zk1211729.htm


SECURITIES AND EXCHANGE COMMISSION
 
WASHINGTON, D.C. 20549
 
FORM 6-K
 
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
 
For the month of July 2012
 
_______________________
 
SILICOM LTD.
(Translation of Registrant’s name into English)
 
_______________________
 
8 Hanagar St., P.O.Box 2164, Kfar-Sava 44425, Israel
(Address of Principal Executive Offices)
 
_______________________
 
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:         
 
Form 20-F þ   Form 40-F o
 
Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:           
 
Yes o   Noþ
 
 
 

 
 
This report on Form 6-K is incorporated by reference into all effective registration statements filed by the Registrant under the Securities Act of 1933.
 
 
 

 
 
Signature
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
SILICOM  Ltd.
 
 
(Registrant)
 
 
 
By:
/s/ Eran Gilad  
    Eran Gilad  
    CFO  
       
Dated:  July 23,  2012
 
 
 

 
 
 


FOR IMMEDIATE RELEASE

EARNINGS RELEASE

SILICOM REPORTS $10.4M REVENUES,
$0.34 NON-GAAP EPS IN Q2 2012

- Company Beginning To Benefit From “Big Data” Phenomenon;
  SETAC Patent Widens Company’s Competitive Advantage -

KFAR SAVA, Israel, July 23, 2012 -- Silicom Ltd. (NASDAQ: SILC, TASE: SILC), an industry-leading provider of high-performance server/appliances networking solutions, today reported its financial results for the second quarter and first half ended June 30, 2012.
 
Financial Results
 
Q2 2012: Revenues for the second quarter increased by 11% to $10.4 million from $9.4 million in the second quarter of 2011.
 
On a GAAP basis, reported net income totalled $2.3 million, or $0.33 per basic and diluted share, up 16% from $2.0 million, or $0.28 per diluted share ($0.29 per basic share) in the second quarter of 2011.
 
On a non-GAAP basis, which excludes non-cash share-based compensation, as described and reconciled below, net income totalled $2.4 million, or $0.34 per diluted and basic share. This is up 14% compared with net income totalled $2.1 million, or $0.30 per diluted and basic share in the second quarter of 2011.
 
H1 2012: Revenues for the first half of 2012 increased by 11% to $20.5 million from $18.5 million in the first half of 2011.
 
On a GAAP basis, reported net income for the period totalled $4.3 million, $0.61 per basic and diluted share, up 14% from $3.7 million, or $0.53 per diluted share ($0.54 per basic share) in the first half of 2011.
 
On a non-GAAP basis, which excludes non-cash share-based compensation, as described and reconciled below, net income for the period totalled $4.5 million, or $0.63 per diluted share ($0.64 per basic share). This is up 12% compared with $4.0 million, or $0.56 per diluted share ($0.58 per basic share) in the first six months of 2011.
 
Cash Position: As of June 30, 2012, the Company’s cash, cash equivalents, bank deposits and marketable securities totalled $52.9 million, or $7.63 per outstanding share, up $1.6 million compared with the end of the first quarter, and up $3.7 million compared with the end of 2011.
 
 
 

 
 
Comments of Management
 
Commenting on the results, Shaike Orbach, President and CEO, said, “The second quarter was another period of steady financial growth and strategic progress that is broadening our leadership in all of our target markets. During the quarter, we announced our first big win with an emerging Big Data player, an important achievement that positions us ideally in this exploding market segment. Late in June, we received a patent for our SETAC concept, giving us exclusivity on a product line that is becoming increasingly recognized as a crucial component in the manufacture of next-generation network appliances.
 
“In general, we are benefiting from one of the IT industry’s strongest-ever forces: the phenomenal growth in the volume of data being stored, transported and used by business and consumers throughout the world. As storage and networking players struggle to keep on top of this tsunami of data, they need higher capacity, higher performance solutions, and they are turning increasingly to our ‘high-octane’ connectivity products as critical enablers, especially in ‘cloud’ and virtualized environments. Therefore, the growth in data is leading to the growth of all of our target markets, creating the possibility for more tenders, design wins, new applications and new implementations of existing applications. Since our history shows that we have consistently won more than our fair share of these opportunities, we believe that we are poised for continued strong growth in our sales and profits over the long term.”
 
##
 
Conference Call Details
 
Silicom’s Management will host an interactive conference today, July 23rd, at 9am Eastern Time (6am Pacific Time, 4pm Israel Time) to review and discuss the results.
 
To participate, please call one of the following teleconferencing numbers. Please begin placing your calls at least 10 minutes before the conference call commences. If you are unable to connect using the toll-free numbers, try the international dial-in number.
 
US: 1 888 668 9141
 
UK: 0 800-917-5108
 
ISRAEL: 03 918 0609
 
INTERNATIONAL:  +972 3 918 0609
 
At: 9:00am Eastern Time, 6:00am Pacific Time, 4:00pm Israel Time
 
For those unable to listen to the live call, a replay of the call will be available for three months from the day after the call under the investor relations section of Silicom’s website.
 
##
 
Non-GAAP Financial Measures
 
This release, including the financial tables below, presents other financial information that may be considered "non-GAAP financial measures" under Regulation G and related reporting requirements promulgated by the Securities and Exchange Commission as they apply to our company. These non-GAAP financial measures exclude compensation expenses in respect of options granted to directors, officers and employees. Non-GAAP financial measures should be evaluated in conjunction with, and are not a substitute for, GAAP financial measures. The tables also present the GAAP financial measures, which are most comparable to the non-GAAP financial measures as well as reconciliation between the non-GAAP financial measures and the most comparable GAAP financial measures. The non-GAAP financial information presented herein should not be considered in isolation from or as a substitute for operating income, net income or per share data prepared in accordance with GAAP.
 
 
 

 
 
About Silicom
 
Silicom Ltd. is an industry-leading provider of high-performance networking solutions designed to increase the throughput and availability of networking appliances and server-based systems.
 
Silicom’s large and growing base of OEM customers includes most of the market-leading players in the areas of WAN Optimization, Security and other mission-critical gateway applications. Silicom’s products include a variety of multi-port 1/10 Gigabit Ethernet server adapters, innovative internal and external BYPASS solutions and advanced Smart adapters, including SSL encryption solutions and Redirector adapters.
 
In addition, Silicom's patented new SETAC (Server To Appliance Converter) product family is a unique solution that enables standard servers to be configured as network appliances with high-density front networking ports and no-hassle port modularity.
 
For more information, please visit: www.silicom.co.il.
 
Statements in this press release which are not historical data are forward-looking statements which involve known and unknown risks, uncertainties, or other factors not under the Company's control, which may cause actual results, performance, or achievements of the Company to be materially different from the results, performance, or other expectations implied by these forward-looking statements. These factors include, but are not limited to, those detailed in the Company's periodic filings with the Securities and Exchange Commission. The Company disclaims any duty to update such statements.
 
Company Contact:
Eran Gilad, CFO
Silicom Ltd.
Tel: +972-9-764-4555
E-mail: erang@silicom.co.il
Investor relations contact:
Kenny Green / Ehud Helft
CCG Israel Investor Relations
Tel: +1 646 201 9246
E-mail : silicom@ccgisrael.com 

-- FINANCIAL TABLES FOLLOW --
 
 
 

 

Silicom Ltd. Consolidated Balance Sheets
 
(US$ thousands)
 
   
June 30,
2012
   
December 31,
2011
 
Assets
           
             
Current assets
           
Cash and cash equivalents
  $ 7,200     $ 11,483  
Short-term bank deposits
    6,527       5,010  
Marketable securities
    5,782       9,027  
Accounts receivables: Trade, net
    9,116       8,613  
Accounts receivables: Other
    1,234       1,597  
Inventories
    11,605       11,173  
Deferred tax assets
    47       48  
Total current assets
    41,511       46,951  
                 
Marketable securities
    33,347       23,667  
Assets held for employees’ severance benefits
    1,280       1,275  
Deferred tax assets
    134       135  
Property, plant and equipment, net
    1,026       837  
                 
Total assets
  $ 77,298     $ 72,865  
                 
Liabilities and shareholders' equity                
             
Current liabilities
           
Trade accounts payable
  $ 4,054     $ 3,978  
Other accounts payable and accrued expenses
    2,339       2,460  
Total current liabilities
    6,393       6,438  
                 
Liability for employees’ severance benefits
    2,158       2,153  
                 
Total liabilities
    8,551       8,591  
                 
Shareholders' equity
               
Ordinary shares and additional paid-in capital
    35,479       35,265  
Treasury shares
    (38 )     (38 )
Retained earnings
    33,306       29,047  
Total Shareholders' equity
    68,747       64,274  
Total liabilities and shareholders' equity
  $ 77,298     $ 72,865  
 
 
 

 

Silicom Ltd. Consolidated
Statements of Operations

(US$ thousands, except for share and per share data)
 
   
Three-month period
   
Six-month period
 
   
ended June 30,
   
ended June 30,
 
   
2012
   
2011
   
2012
   
2011
 
Sales
  $ 10,413     $ 9,357     $ 20,514     $ 18,534  
Cost of sales
    5,989       5,215       11,927       10,412  
Gross profit
    4,424       4,142       8,587       8,122  
                                 
Research and development expenses
    992       1,020       2,083       2,058  
Selling and marketing expenses
    646       669       1,280       1,330  
General and administrative expenses
    530       462       1,062       974  
Total operating expenses
    2,168       2,151       4,425       4,362  
                                 
Operating income
    2,256       1,991       4,162       3,760  
                                 
Financial income, net
    212       151       452       333  
Income before income taxes
    2,468       2,142       4,614       4,093  
Income taxes
    186       168       355       354  
Net income
  $ 2,282     $ 1,974     $ 4,259     $ 3,739  
                                 
Basic income per ordinary share (US$)
  $ 0.33     $ 0.29     $ 0.61     $ 0.54  
                                 
Weighted average number of ordinary
shares used to compute basic income per
share (in thousands)
      6,930         6,890         6,929         6,888  
                                 
Diluted income per ordinary share (US$)
  $ 0.33     $ 0.28     $ 0.61     $ 0.53  
                                 
Weighted average number of ordinary
shares used to compute diluted income per
share (in thousands)
      7,020         7,026         7,021         7,019  
 
 
 

 

Silicom Ltd. Reconciliation of
Non-GAAP Financial Results

 (US$ thousands, except for share and per share data)
 
   
Three-month period
 
   
ended June 30,
 
    2012     2011  
   
GAAP
 (as reported)
   
Adjustments (*)
   
Non-GAAP
   
Non-GAAP
 
Sales
  $ 10,413           $ 10,413     $ 9,357  
Cost of sales
    5,989       4       5,985       5,209  
Gross profit
    4,424               4,428       4,148  
                                 
Research and development expenses
    992       21       971       996  
Selling and marketing expenses
    646       30       616       636  
General and administrative expenses
    530       43       487       417  
Total operating expenses
    2,168               2,074       2,049  
                                 
Operating income
    2,256               2,354       2,099  
                                 
Financial income, net
    212               212       151  
Income before income taxes
    2,468               2,566       2,250  
Income taxes
    186               186       168  
Net income
  $ 2,282             $ 2,380     $ 2,082  
                                 
Basic income per ordinary share (US$)
  $ 0.33             $ 0.34     $ 0.30  
                                 
Weighted average number of ordinary
shares used to compute basic income per
share (in thousands)
      6,930                 6,930         6,890  
                                 
Diluted income per ordinary share (US$)
  $ 0.33             $ 0.34     $ 0.30  
                                 
Weighted average number of ordinary
shares used to compute diluted income per
share (in thousands)
      7,020                 7,020         7,026  
                                 
Total Adjustments
            98                  
 
(*) Adjustments related to share-based compensation expenses according to ASC topic 718 (SFAS 123 (R))
 
 
 

 

Silicom Ltd. Reconciliation of
Non-GAAP Financial Results

 (US$ thousands, except for share and per share data)
 
   
Six-month period
 
   
ended June 30,
 
    2012     2011  
   
GAAP
 (as reported)
   
Adjustments (*)
   
Non-GAAP
   
Non-GAAP
 
Sales
  $ 20,514           $ 20,514     $ 18,534  
Cost of sales
    11,927       8       11,919       10,399  
Gross profit
    8,587               8,595       8,135  
                                 
Research and development expenses
    2,083       42       2,041       2,008  
Selling and marketing expenses
    1,280       60       1,220       1,261  
General and administrative expenses
    1,062       86       976       881  
Total operating expenses
    4,425               4,237       4,150  
                                 
Operating income
    4,162               4,358       3,985  
                                 
Financial income, net
    452               452       333  
Income before income taxes
    4,614               4,810       4,318  
Income taxes
    355               355       354  
Net income
  $ 4,259             $ 4,455     $ 3,964  
                                 
Basic income per ordinary share (US$)
  $ 0.61             $ 0.64     $ 0.58  
                                 
Weighted average number of ordinary
shares used to compute basic income per
share (in thousands)
      6,929                 6,929         6,888  
                                 
Diluted income per ordinary share (US$)
  $ 0.61             $ 0.63     $ 0.56  
                                 
Weighted average number of ordinary
shares used to compute diluted income per
share (in thousands)
      7,021                 7,021         7,019  
                                 
Total Adjustments
            196                  
                                 
(*) Adjustments related to share-based compensation expenses according to ASC topic 718 (SFAS 123 (R))