f20fa_072312.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM 20-F/A
(Mark One)
| |
[ ]
|
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|
OR
|
|
[X] |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
For the fiscal year ended December 31, 2011
|
OR
|
|
[ ] |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
For the transition period from ________________ to ________________
|
OR
| |
[ ]
|
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
Date of event requiring this shell company report ________________
|
Commission file number: 000-51847
HIMAX TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)
Not Applicable
(Translation of Registrant’s name into English)
CAYMAN ISLANDS
(Jurisdiction of incorporation or organization)
NO. 26, ZIH LIAN ROAD
SINSHIH DISTRICT, TAINAN CITY 74148
TAIWAN, REPUBLIC OF CHINA
(Address of principal executive offices)
Jackie Chang
Chief Financial Officer
Telephone: +886-2-2370-3999
E-mail: jackie_chang@himax.com.tw
Facsimile: +886-2-2314-0877
10F, No. 1, Xiangyang Road
Taipei 10046
Taiwan, Republic of China
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
|
Title of each class
|
Name of each exchange on which registered
|
|
Ordinary Shares, par value $0.3 per ordinary share
|
The Nasdaq Global Select Market Inc.*
|
| |
|
|
*
|
Not for trading, but only in connection with the listing on the Nasdaq Global Select Market, Inc. of American Depositary Shares representing such Ordinary Shares
|
Securities registered or to be registered pursuant to Section 12(g) of the Act: None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report. 349,279,556 Ordinary Shares.
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. [ ] Yes [X] No
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. [ ] Yes [X] No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [X] Yes [ ] No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer [ ] Accelerated filer [X] Non-accelerated filer [ ]
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
U.S. GAAP [X] International Financial Reporting Standards as issued by the International Accounting Standards Board [ ]Other [ ]
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. [ ] Item 17 [ ] Item 18
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [ ] Yes [X] No
EXPLANATORY NOTE
We are filing this Amendment No. 3 to our Annual Report on Form 20-F for the fiscal year ended December 31, 2011, which we filed with the Securities and Exchange Commission on May 1, 2012, for the sole purpose of adding auditor name and signature on Report of Independent Registered Public Accounting Firm as below.
No other changes have been made to our Annual Report on Form 20-F. This Amendment No. 3 does not reflect events that have occurred after the May 1, 2012 filing date of our Annual Report on Form 20-F, or modify or update the disclosures therein, except to reflect the amendment described above.
HIMAX TECHNOLOGIES, INC.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
The Board of Directors and Stockholders
Himax Technologies, Inc.:
We have audited the accompanying consolidated balance sheets of Himax Technologies, Inc. (a Cayman Island Company) and subsidiaries as of December 31, 2010 and 2011, and the related consolidated statements of income, comprehensive income, equity and cash flows for each of the years in the three-year period ended December 31, 2011. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statements presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Himax Technologies, Inc. and subsidiaries as of December 31, 2010 and 2011, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2011, in conformity with U. S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Himax Technologies, Inc.’s internal control over financial reporting as of December 31, 2011, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated April 26, 2012 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
/S/ KPMG
Taipei, Taiwan (the Republic of China)
April 26, 2012
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
December 31, 2010 and 2011
(in thousands of US dollars)
| |
|
December 31,
|
|
| |
|
2010
|
|
|
2011
|
|
|
Assets
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$ |
96,842 |
|
|
|
106,164 |
|
|
Investments in marketable securities available-for-sale
|
|
|
8,632 |
|
|
|
165 |
|
|
Accounts receivable, less allowance for doubtful accounts, sales returns and discounts of $17,180 and $15,888 at December 31, 2010 and 2011, respectively
|
|
|
80,212 |
|
|
|
101,280 |
|
|
Accounts receivable from related parties, less allowance for sales returns and discounts of $138 and $83 at December 31, 2010 and 2011, respectively
|
|
|
95,964 |
|
|
|
79,833 |
|
|
Inventories
|
|
|
117,988 |
|
|
|
112,985 |
|
|
Deferred income taxes
|
|
|
11,977 |
|
|
|
16,217 |
|
|
Restricted cash and cash equivalents
|
|
|
58,500 |
|
|
|
84,200 |
|
|
Prepaid expenses and other current assets
|
|
|
15,809 |
|
|
|
14,865 |
|
|
Total current assets
|
|
|
485,924 |
|
|
|
515,709 |
|
| |
|
|
|
|
|
|
|
|
|
Investment securities, including securities measured at fair value of $5,196 and $5,080 at December 31, 2010 and 2011, respectively
|
|
|
24,622 |
|
|
|
24,506 |
|
|
Equity method investments
|
|
|
869 |
|
|
|
439 |
|
|
Property, plant and equipment, net
|
|
|
47,561 |
|
|
|
57,150 |
|
|
Deferred income taxes
|
|
|
24,729 |
|
|
|
13,649 |
|
|
Goodwill
|
|
|
26,846 |
|
|
|
26,846 |
|
|
Intangible assets, net
|
|
|
6,674 |
|
|
|
4,494 |
|
|
Restricted marketable securities
|
|
|
172 |
|
|
|
1,266 |
|
|
Other assets
|
|
|
2,223 |
|
|
|
919 |
|
| |
|
|
133,696 |
|
|
|
129,269 |
|
|
Total assets
|
|
$ |
619,620 |
|
|
|
644,978 |
|
See accompanying notes to consolidated financial statements.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Continued)
December 31, 2010 and 2011
(in thousands of US dollars, except share and per share data)
| |
|
December 31, |
|
| |
|
2010
|
|
|
2011
|
|
|
Liabilities and Equity
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Short-term debt
|
|
$ |
57,000 |
|
|
|
84,200 |
|
|
Accounts payable
|
|
|
115,922 |
|
|
|
134,353 |
|
|
Income taxes payable
|
|
|
9,125 |
|
|
|
3,644 |
|
|
Deferred income taxes
|
|
|
96 |
|
|
|
- |
|
|
Other accrued expenses and other current liabilities
|
|
|
23,605 |
|
|
|
23,163 |
|
|
Total current liabilities
|
|
|
205,748 |
|
|
|
245,360 |
|
|
Income taxes payable
|
|
|
133 |
|
|
|
- |
|
|
Accrued pension liabilities
|
|
|
168 |
|
|
|
319 |
|
|
Deferred income taxes
|
|
|
1,215 |
|
|
|
836 |
|
|
Other liabilities
|
|
|
5,380 |
|
|
|
3,405 |
|
|
Total liabilities
|
|
|
212,644 |
|
|
|
249,920 |
|
| |
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
Himax Technologies, Inc. stockholders’ equity:
|
|
|
|
|
|
|
|
|
|
Ordinary shares, US$0.3 par value, 1,000,000,000 shares authorized; 353,842,764 shares issued and outstanding at December 31, 2010; 356,699,482 shares issued and 349,279,556 shares outstanding at December 31, 2011
|
|
|
106,153 |
|
|
|
107,010 |
|
|
Additional paid-in capital
|
|
|
100,291 |
|
|
|
103,051 |
|
|
Treasury shares, at cost (nil and 7,419,926 ordinary shares at December 31, 2010 and December 31, 2011, respectively)
|
|
|
- |
|
|
|
(4,502 |
) |
|
Accumulated other comprehensive income
|
|
|
1,204 |
|
|
|
166 |
|
|
Unappropriated retained earnings
|
|
|
198,230 |
|
|
|
187,712 |
|
|
Total Himax Technologies, Inc. stockholders’ equity
|
|
|
405,878 |
|
|
|
393,437 |
|
|
Noncontrolling interests
|
|
|
1,098 |
|
|
|
1,621 |
|
|
Total equity
|
|
|
406,976 |
|
|
|
395,058 |
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity
|
|
$ |
619,620 |
|
|
|
644,978 |
|
See accompanying notes to consolidated financial statements.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Years ended December 31, 2009, 2010 and 2011
(in thousands of US dollars, except per share data)
| |
|
Year Ended December 31, |
|
| |
|
2009
|
|
|
2010
|
|
|
2011
|
|
| |
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
Revenues from third parties, net
|
|
$ |
245,075 |
|
|
|
304,068 |
|
|
|
374,788 |
|
|
Revenues from related parties, net
|
|
|
447,306 |
|
|
|
338,624 |
|
|
|
258,233 |
|
| |
|
|
692,381 |
|
|
|
642,692 |
|
|
|
633,021 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
|
|
|
550,556 |
|
|
|
507,647 |
|
|
|
507,449 |
|
|
Research and development
|
|
|
71,364 |
|
|
|
76,426 |
|
|
|
79,042 |
|
|
General and administrative
|
|
|
16,346 |
|
|
|
18,770 |
|
|
|
17,095 |
|
|
(Recovery of ) bad debt expense
|
|
|
218 |
|
|
|
(8,788 |
) |
|
|
(1,541 |
) |
|
Sales and marketing
|
|
|
10,360 |
|
|
|
13,279 |
|
|
|
14,368 |
|
|
Total costs and expenses
|
|
|
648,844 |
|
|
|
607,334 |
|
|
|
616,413 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
43,537 |
|
|
|
35,358 |
|
|
|
16,608 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non operating income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
766 |
|
|
|
607 |
|
|
|
556 |
|
|
Gains (losses) on sale of marketable securities, net
|
|
|
(87 |
) |
|
|
296 |
|
|
|
350 |
|
|
Equity in losses of equity method investees
|
|
|
(89 |
) |
|
|
(410 |
) |
|
|
(349 |
) |
|
Foreign currency exchange gains (losses), net
|
|
|
(510 |
) |
|
|
(899 |
) |
|
|
466 |
|
|
Interest expense
|
|
|
(3 |
) |
|
|
(182 |
) |
|
|
(455 |
) |
|
Other income (loss), net
|
|
|
111 |
|
|
|
524 |
|
|
|
(368 |
) |
| |
|
|
188 |
|
|
|
(64 |
) |
|
|
200 |
|
|
Earnings before income taxes
|
|
|
43,725 |
|
|
|
35,294 |
|
|
|
16,808 |
|
|
Income tax expense
|
|
|
7,915 |
|
|
|
6,228 |
|
|
|
7,301 |
|
|
Net income
|
|
|
35,810 |
|
|
|
29,066 |
|
|
|
9,507 |
|
|
Net loss attributable to noncontrolling interests
|
|
|
3,840 |
|
|
|
4,140 |
|
|
|
1,199 |
|
|
Net income attributable to Himax Technologies, Inc. stockholders
|
|
$ |
39,650 |
|
|
|
33,206 |
|
|
|
10,706 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per ordinary share attributable to Himax Technologies, Inc. stockholders
|
|
$ |
0.11 |
|
|
|
0.09 |
|
|
|
0.03 |
|
|
Diluted earnings per ordinary share attributable to Himax Technologies, Inc. stockholders
|
|
$ |
0.11 |
|
|
|
0.09 |
|
|
|
0.03 |
|
|
Basic earnings per ADS attributable to Himax Technologies, Inc. stockholders
|
|
$ |
0.21 |
|
|
|
0.19 |
|
|
|
0.06 |
|
|
Diluted earnings per ADS attributable to Himax Technologies, Inc. stockholders
|
|
$ |
0.21 |
|
|
|
0.19 |
|
|
|
0.06 |
|
See accompanying notes to consolidated financial statements.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Years ended December 31, 2009, 2010 and 2011
(in thousands of US dollars)
| |
|
Year Ended December 31, |
|
| |
|
2009
|
|
|
2010
|
|
|
2011
|
|
| |
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$ |
35,810 |
|
|
|
29,066 |
|
|
|
9,507 |
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gains (losses) on securities, not subject to income tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized holding gains (losses) on available-for-sale marketable securities arising during the period
|
|
|
(193 |
) |
|
|
1,511 |
|
|
|
(305 |
) |
|
Reclassification adjustment for realized losses (gains) included in net income
|
|
|
87 |
|
|
|
(296 |
) |
|
|
(350 |
) |
|
Foreign currency translation adjustments, not subject to income tax
|
|
|
463 |
|
|
|
210 |
|
|
|
128 |
|
|
Net unrecognized actuarial loss, net of tax of $(18), $(54) and $(125) in 2009, 2010 and 2011, respectively
|
|
|
(22 |
) |
|
|
(203 |
) |
|
|
(573 |
) |
|
Comprehensive income
|
|
|
36,145 |
|
|
|
30,288 |
|
|
|
8,407 |
|
|
Comprehensive loss attributable to noncontrolling interests
|
|
|
3,823 |
|
|
|
4,118 |
|
|
|
1,261 |
|
|
Comprehensive income attributable to Himax Technologies, Inc. stockholders
|
|
$ |
39,968 |
|
|
|
34,406 |
|
|
|
9,668 |
|
See accompanying notes to consolidated financial statements.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Years ended December 31, 2009, 2010 and 2011
(in thousands of US dollars and shares, except per share data)
| |
|
Ordinary shares
|
|
|
Additional
|
|
|
Treasury shares
|
|
|
Accumulated
other
|
|
|
Unappropriated
|
|
|
Total Himax
Technologies, Inc.
|
|
|
|
|
|
|
|
| |
|
Shares
|
|
|
Amount
|
|
|
paid-in
capital
|
|
|
Shares
|
|
|
Amount
|
|
|
comprehensive
income (loss)
|
|
|
retained
earnings
|
|
|
stockholders’
equity
|
|
|
Noncontrolling
interests
|
|
|
Total
Equity
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2009
|
|
|
380,239 |
|
|
$ |
114,072 |
|
|
|
124,446 |
|
|
|
- |
|
|
|
- |
|
|
|
(314 |
) |
|
|
224,967 |
|
|
|
463,171 |
|
|
|
6,835 |
|
|
|
470,006 |
|
|
Shares acquisition
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(26,251 |
) |
|
|
(36,462 |
) |
|
|
- |
|
|
|
- |
|
|
|
(36,462 |
) |
|
|
- |
|
|
|
(36,462 |
) |
|
Shares retirement
|
|
|
(26,251 |
) |
|
|
(7,875 |
) |
|
|
(28,587 |
) |
|
|
26,251 |
|
|
|
36,462 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Restricted stock vested
|
|
|
4,024 |
|
|
|
1,207 |
|
|
|
(1,207 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Share-based compensation expenses
|
|
|
- |
|
|
|
- |
|
|
|
8,181 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
8,181 |
|
|
|
372 |
|
|
|
8,553 |
|
|
New shares issued by subsidiary
|
|
|
- |
|
|
|
- |
|
|
|
(207 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(207 |
) |
|
|
1,234 |
|
|
|
1,027 |
|
|
Sale (purchase) of subsidiary shares to (from) noncontrolling interests
|
|
|
- |
|
|
|
- |
|
|
|
285 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
285 |
|
|
|
1 |
|
|
|
286 |
|
|
Dilution gain of equity method investments
|
|
|
- |
|
|
|
- |
|
|
|
13 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
13 |
|
|
|
- |
|
|
|
13 |
|
|
Net unrecognized actuarial loss, net of tax of $(18)
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(41 |
) |
|
|
- |
|
|
|
(41 |
) |
|
|
19 |
|
|
|
(22 |
) |
|
Unrealized holding losses on available-for-sale marketable securities
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(105 |
) |
|
|
- |
|
|
|
(105 |
) |
|
|
(1 |
) |
|
|
(106 |
) |
|
Foreign currency translation adjustments
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
464 |
|
|
|
- |
|
|
|
464 |
|
|
|
(1 |
) |
|
|
463 |
|
|
Declaration of cash dividends, $0.150 per share
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(55,496 |
) |
|
|
(55,496 |
) |
|
|
- |
|
|
|
(55,496 |
) |
|
Net income (loss)
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
39,650 |
|
|
|
39,650 |
|
|
|
(3,840 |
) |
|
|
35,810 |
|
|
Balance at December 31, 2009
|
|
|
358,012 |
|
|
|
107,404 |
|
|
|
102,924 |
|
|
|
- |
|
|
|
- |
|
|
|
4 |
|
|
|
209,121 |
|
|
|
419,453 |
|
|
|
4,619 |
|
|
|
424,072 |
|
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Consolidated Statements of Equity (Continued)
Years ended December 31, 2009, 2010 and 2011
(in thousands of US dollars and shares, except per share data)
| |
|
Ordinary shares
|
|
|
Additional
|
|
|
Treasury shares
|
|
|
Accumulated
other
|
|
|
Unappropriated
|
|
|
Total Himax
Technologies, Inc.
|
|
|
|
|
|
|
|
| |
|
Shares
|
|
|
Amount
|
|
|
paid-in
capital
|
|
|
Shares
|
|
|
Amount
|
|
|
comprehensive
income (loss)
|
|
|
retained
earnings
|
|
|
stockholders’
equity
|
|
|
Noncontrolling
interests
|
|
|
Total
Equity
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares acquisition
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(7,708 |
) |
|
|
(10,755 |
) |
|
|
- |
|
|
|
- |
|
|
|
(10,755 |
) |
|
|
- |
|
|
|
(10,755 |
) |
|
Shares retirement
|
|
|
(7,708 |
) |
|
|
(2,312 |
) |
|
|
(8,443 |
) |
|
|
7,708 |
|
|
|
10,755 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Restricted stock vested
|
|
|
3,539 |
|
|
|
1,061 |
|
|
|
(1,061 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Share-based compensation expenses
|
|
|
- |
|
|
|
- |
|
|
|
6,219 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
6,219 |
|
|
|
92 |
|
|
|
6,311 |
|
|
New shares issued by subsidiary
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
353 |
|
|
|
353 |
|
|
Sale (purchase) of subsidiary shares to (from) noncontrolling interests
|
|
|
- |
|
|
|
- |
|
|
|
652 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
652 |
|
|
|
152 |
|
|
|
804 |
|
|
Net unrecognized actuarial loss, net of tax of $(54)
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(201 |
) |
|
|
- |
|
|
|
(201 |
) |
|
|
(2 |
) |
|
|
(203 |
) |
|
Unrealized holding gains on available-for-sale marketable securities
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,193 |
|
|
|
- |
|
|
|
1,193 |
|
|
|
22 |
|
|
|
1,215 |
|
|
Foreign currency translation adjustments
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
208 |
|
|
|
- |
|
|
|
208 |
|
|
|
2 |
|
|
|
210 |
|
|
Declaration of cash dividends, $0.125 per share
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(44,097 |
) |
|
|
(44,097 |
) |
|
|
- |
|
|
|
(44,097 |
) |
|
Net income (loss)
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
33,206 |
|
|
|
33,206 |
|
|
|
(4,140 |
) |
|
|
29,066 |
|
|
Balance at December 31, 2010
|
|
|
353,843 |
|
|
|
106,153 |
|
|
|
100,291 |
|
|
|
- |
|
|
|
- |
|
|
|
1,204 |
|
|
|
198,230 |
|
|
|
405,878 |
|
|
|
1,098 |
|
|
|
406,976 |
|
See accompanying notes to consolidated financial statements.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Consolidated Statements of Equity (Continued)
Years ended December 31, 2009, 2010 and 2011
(in thousands of US dollars and shares, except per share data)
| |
|
Ordinary shares
|
|
|
Additional
|
|
|
Treasury shares
|
|
|
Accumulated
other
|
|
|
Unappropriated
|
|
|
Total Himax
Technologies, Inc.
|
|
|
|
|
|
|
|
| |
|
Shares
|
|
|
Amount
|
|
|
paid-in
capital
|
|
|
Shares
|
|
|
Amount
|
|
|
comprehensive
income (loss)
|
|
|
retained
earnings
|
|
|
stockholders’
equity
|
|
|
Noncontrolling
interests
|
|
|
Total
Equity
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares acquisition
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
(7,534 |
) |
|
|
(4,627 |
) |
|
|
- |
|
|
|
- |
|
|
|
(4,627 |
) |
|
|
- |
|
|
|
(4,627 |
) |
|
Shares retirement
|
|
|
(114 |
) |
|
|
(34 |
) |
|
|
(91 |
) |
|
|
114 |
|
|
|
125 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Restricted stock vested
|
|
|
2,971 |
|
|
|
891 |
|
|
|
(891 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Share-based compensation expenses
|
|
|
- |
|
|
|
- |
|
|
|
4,124 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
4,124 |
|
|
|
66 |
|
|
|
4,190 |
|
|
New shares issued by subsidiary
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
53 |
|
|
|
53 |
|
|
Sale (purchase) of subsidiary shares to (from) noncontrolling interests
|
|
|
- |
|
|
|
- |
|
|
|
(382 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(382 |
) |
|
|
1,665 |
|
|
|
1,283 |
|
|
Net unrecognized actuarial loss, net of tax of $(125)
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(546 |
) |
|
|
- |
|
|
|
(546 |
) |
|
|
(27 |
) |
|
|
(573 |
) |
|
Unrealized holding loss on available-for-sale marketable securities
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(620 |
) |
|
|
- |
|
|
|
(620 |
) |
|
|
(35 |
) |
|
|
(655 |
) |
|
Foreign currency translation adjustments
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
128 |
|
|
|
- |
|
|
|
128 |
|
|
|
- |
|
|
|
128 |
|
|
Declaration of cash dividends, $0.060 per share
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(21,224 |
) |
|
|
(21,224 |
) |
|
|
- |
|
|
|
(21,224 |
) |
|
Net income (loss)
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
10,706 |
|
|
|
10,706 |
|
|
|
(1,199 |
) |
|
|
9,507 |
|
|
Balance at December 31, 2011
|
|
|
356,700 |
|
|
$ |
107,010 |
|
|
|
103,051 |
|
|
|
(7,420 |
) |
|
|
(4,502 |
) |
|
|
166 |
|
|
|
187,712 |
|
|
|
393,437 |
|
|
|
1,621 |
|
|
|
395,058 |
|
See accompanying notes to consolidated financial statements.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Years ended December 31, 2009, 2010 and 2011
(in thousands of US dollars)
| |
|
Year Ended December 31,
|
|
| |
|
2009
|
|
|
2010
|
|
|
2011
|
|
| |
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$ |
35,810 |
|
|
|
29,066 |
|
|
|
9,507 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
13,795 |
|
|
|
13,626 |
|
|
|
12,795 |
|
|
Bad debt expense
|
|
|
218 |
|
|
|
- |
|
|
|
- |
|
|
Share-based compensation expenses
|
|
|
8,553 |
|
|
|
6,311 |
|
|
|
4,190 |
|
|
Loss on disposal of property and equipment
|
|
|
43 |
|
|
|
34 |
|
|
|
121 |
|
|
Gain on disposal of equity method investment
|
|
|
- |
|
|
|
- |
|
|
|
(313 |
) |
|
Loss (gain) on disposal of marketable securities, net
|
|
|
87 |
|
|
|
(296 |
) |
|
|
(350 |
) |
|
Unrealized loss (gain) on conversion option
|
|
|
- |
|
|
|
(320 |
) |
|
|
934 |
|
|
Interest income from amortization of discount on investment in corporate bonds
|
|
|
- |
|
|
|
(52 |
) |
|
|
(170 |
) |
|
Equity in losses of equity method investees
|
|
|
89 |
|
|
|
410 |
|
|
|
349 |
|
|
Deferred income tax expense
|
|
|
1,448 |
|
|
|
4,481 |
|
|
|
6,492 |
|
|
Inventories write downs
|
|
|
13,622 |
|
|
|
10,557 |
|
|
|
9,138 |
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
(13,686 |
) |
|
|
(14,782 |
) |
|
|
(21,068 |
) |
|
Accounts receivable from related parties
|
|
|
(33,685 |
) |
|
|
41,306 |
|
|
|
16,181 |
|
|
Inventories
|
|
|
14,401 |
|
|
|
(60,777 |
) |
|
|
(4,135 |
) |
|
Prepaid expenses and other current assets
|
|
|
(2,300 |
) |
|
|
(1,590 |
) |
|
|
951 |
|
|
Accounts payable
|
|
|
34,360 |
|
|
|
27,843 |
|
|
|
18,431 |
|
|
Income taxes payable
|
|
|
(880 |
) |
|
|
(5,793 |
) |
|
|
(5,616 |
) |
|
Other accrued expenses and other current liabilities
|
|
|
2,452 |
|
|
|
4,767 |
|
|
|
(2,092 |
) |
|
Other liabilities
|
|
|
(697 |
) |
|
|
2,840 |
|
|
|
(1,897 |
) |
|
Net cash provided by operating activities
|
|
|
73,630 |
|
|
|
57,631 |
|
|
|
43,448 |
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of property and equipment
|
|
|
(10,592 |
) |
|
|
(7,172 |
) |
|
|
(18,859 |
) |
|
Proceeds from disposal of property and equipment
|
|
|
25 |
|
|
|
- |
|
|
|
7 |
|
|
Purchase of available-for-sale marketable securities
|
|
|
(34,248 |
) |
|
|
(34,976 |
) |
|
|
(17,490 |
) |
|
Disposal of available-for-sale marketable securities
|
|
|
39,263 |
|
|
|
33,443 |
|
|
|
25,834 |
|
|
Disposal of equity method investment
|
|
|
- |
|
|
|
- |
|
|
|
371 |
|
|
Purchase of investment securities
|
|
|
- |
|
|
|
(7,524 |
) |
|
|
- |
|
|
Purchase of equity method investments
|
|
|
(663 |
) |
|
|
(906 |
) |
|
|
- |
|
|
Refund from (increase in) refundable deposits
|
|
|
(217 |
) |
|
|
298 |
|
|
|
34 |
|
|
Increase in other assets
|
|
|
(7 |
) |
|
|
(684 |
) |
|
|
- |
|
|
Pledge of restricted cash, cash equivalents and marketable securities
|
|
|
(1,002 |
) |
|
|
(78 |
) |
|
|
(94 |
) |
|
Purchase of intangible assets
|
|
|
(100 |
) |
|
|
- |
|
|
|
- |
|
|
Net cash used in investing activities
|
|
|
(7,541 |
) |
|
|
(17,599 |
) |
|
|
(10,197 |
) |
See accompanying notes to consolidated financial statements.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Continued)
Years ended December 31, 2009, 2010 and 2011
(in thousands of US dollars)
| |
|
Year Ended December 31, |
|
| |
|
2009
|
|
|
2010
|
|
|
2011
|
|
| |
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
Distribution of cash dividends
|
|
$ |
(55,496 |
) |
|
|
(44,097 |
) |
|
|
(21,224 |
) |
|
Proceeds from disposal of subsidiary shares to noncontrolling interests by Himax Technologies Limited
|
|
|
529 |
|
|
|
1,011 |
|
|
|
17 |
|
|
Proceeds from disposal of subsidiary shares to noncontrolling interests by Himax Imaging, Inc.
|
|
|
- |
|
|
|
- |
|
|
|
3,224 |
|
|
Purchase of subsidiary shares from noncontrolling interests
|
|
|
(243 |
) |
|
|
(207 |
) |
|
|
(1,958 |
) |
|
Pledge of restricted cash, cash equivalents and marketable securities (for borrowing of short-term debt)
|
|
|
- |
|
|
|
(57,500 |
) |
|
|
(26,700 |
) |
|
Proceeds from issuance of new shares by subsidiaries
|
|
|
1,027 |
|
|
|
353 |
|
|
|
53 |
|
|
Payments to repurchase ordinary shares
|
|
|
(36,596 |
) |
|
|
(10,755 |
) |
|
|
(4,627 |
) |
|
Proceeds from borrowing of short-term debt
|
|
|
80,000 |
|
|
|
217,000 |
|
|
|
277,200 |
|
|
Repayment of short-term debt
|
|
|
(80,000 |
) |
|
|
(160,000 |
) |
|
|
(250,000 |
) |
|
Net cash used in financing activities
|
|
|
(90,779 |
) |
|
|
(54,195 |
) |
|
|
(24,015 |
) |
|
Effect of foreign currency exchange rate changes on cash and cash equivalents
|
|
|
414 |
|
|
|
81 |
|
|
|
86 |
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
(24,276 |
) |
|
|
(14,082 |
) |
|
|
9,322 |
|
|
Cash and cash equivalents at beginning of year
|
|
|
135,200 |
|
|
|
110,924 |
|
|
|
96,842 |
|
|
Cash and cash equivalents at end of year
|
|
$ |
110,924 |
|
|
|
96,842 |
|
|
|
106,164 |
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid during the year for:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
|
|
$ |
3 |
|
|
|
170 |
|
|
|
490 |
|
|
Income taxes
|
|
$ |
7,652 |
|
|
|
8,329 |
|
|
|
6,326 |
|
See accompanying notes to consolidated financial statements.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
December 31, 2009, 2010 and 2011
|
Note 1.
|
Background, Principal Activities and Basis of Presentation
|
Background
Himax Technologies, Inc. is a holding company located in the Cayman Islands. Following is general information about Himax Technologies, Inc.’s subsidiaries:
| |
|
|
|
Jurisdiction of
|
|
Percentage of
Ownership
December 31,
|
|
|
Subsidiary
|
|
Main activities
|
|
Incorporation
|
|
2010
|
|
|
2011
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
Himax Technologies Limited
|
|
IC design and sales
|
|
ROC
|
|
|
100.00 |
% |
|
|
100.00 |
% |
|
Himax Technologies Korea Ltd. (formerly Himax Technologies Anyang Limited)
|
|
Sales
|
|
South Korea
|
|
|
100.00 |
% |
|
|
100.00 |
% |
|
Himax Semiconductor, Inc. (formerly Wisepal Technologies, Inc.)
|
|
IC design and sales
|
|
ROC
|
|
|
100.00 |
% |
|
|
100.00 |
% |
|
Himax Technologies (Samoa), Inc.
|
|
Investments
|
|
Samoa
|
|
|
100.00 |
% |
|
|
100.00 |
% |
|
Himax Technologies (Suzhou), Co., Ltd.
|
|
Sales
|
|
PRC
|
|
|
100.00 |
% |
|
|
100.00 |
% |
|
Himax Technologies (Shenzhen), Co., Ltd.
|
|
Sales
|
|
PRC
|
|
|
100.00 |
% |
|
|
100.00 |
% |
|
Himax Display, Inc.
|
|
IC design, manufacturing and sales
|
|
ROC
|
|
|
87.96 |
% |
|
|
88.02 |
% |
|
Integrated Microdisplays Limited
|
|
IC design and sales
|
|
Hong Kong
|
|
|
87.96 |
% |
|
|
88.02 |
% |
|
Himax Display US Corp.
|
|
Investments
|
|
Delaware, USA
|
|
|
- |
|
|
|
88.02 |
% |
|
Himax Analogic, Inc.
|
|
IC design and sales
|
|
ROC
|
|
|
75.11 |
% |
|
|
75.10 |
% |
|
Himax Imaging, Inc.
|
|
Investments
|
|
Cayman Islands
|
|
|
93.37 |
% |
|
|
100.00 |
% |
|
Himax Imaging, Ltd.
|
|
IC design and sales
|
|
ROC
|
|
|
93.37 |
% |
|
|
89.69 |
% |
|
Himax Imaging Corp.
|
|
IC design
|
|
California, USA
|
|
|
93.37 |
% |
|
|
100.00 |
% |
|
Argo Limited
|
|
Investments
|
|
Cayman Islands
|
|
|
100.00 |
% |
|
|
100.00 |
% |
|
Tellus Limited
|
|
Investments
|
|
Cayman Islands
|
|
|
100.00 |
% |
|
|
100.00 |
% |
|
Himax Media Solutions, Inc.
|
|
TFT-LCD television and monitor chipset operations
|
|
ROC
|
|
|
78.11 |
% |
|
|
78.25 |
% |
|
Himax Media Solutions (Hong Kong) Limited
|
|
Investments
|
|
Hong Kong
|
|
|
78.11 |
% |
|
|
78.25 |
% |
|
Harvest Investment Limited
|
|
Investments
|
|
ROC
|
|
|
100.00 |
% |
|
|
100.00 |
% |
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
Since March 2006, Himax Technologies, Inc.’s ordinary shares have been quoted on the NASDAQ Global Market under the symbol “HIMX” in the form of ADSs and two ordinary shares represent one ADS effect from August 10, 2009. See Note15 (a) as further described.
Principal Activities
Himax Technologies, Inc. and subsidiaries (collectively, the Company) designs, develops and markets semiconductors that are critical components of flat panel displays. The Company’s principal products are display drivers for large-sized thin film transistor liquid crystal displays (TFT-LCD) panels, which are used in desktop monitors, notebook computers and televisions, and display drivers for small-and medium-sized TFT-LCD panels which are used in mobile handsets, and consumer electronics products such as tablet PCs, netbook computers (with a display size of typically less than 10 inches), digital cameras, mobile gaming devices, portable DVD players, digital photo frame and car navigation displays. The Company also offers display drivers for panels using OLED technology and LTPS technology. In addition, the Company is expanding its product offerings to include non-driver products such as timing controllers, touch controller ICs, TFT-LCD television and monitor chipsets, LCOS projector solutions, power management ICs, CMOS image sensors, wafer level optics products, infinitely color technology and 2D to 3D conversion solutions. The Company’s customers are TFT-LCD panel manufacturers, mobile device module manufacturers and television makers.
Basis of Presentation
The accompanying consolidated financial statements of the Company have been prepared in conformity with US generally accepted accounting principles (“US GAAP”).
|
Note 2.
|
Summary of Significant Accounting Policies
|
|
|
(a)
|
Principles of Consolidation
|
The accompanying consolidated financial statements include the accounts and operations of the Himax Technologies, Inc. and all of its majority owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions relating to the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the useful lives of property, plant and equipment and intangible assets; allowances for doubtful accounts and sales returns; the valuation of derivatives, deferred income tax assets, property, plant and equipment, inventory, share-based compensation and potential impairment of intangible assets, goodwill, marketable securities and other investment securities and liabilities for employee benefit obligations, and income tax uncertainties and other contingencies.
|
|
(c)
|
Cash and Cash Equivalents
|
The Company considers all highly liquid investments purchased with an original maturity of three months or less at the time of purchase to be cash equivalents. As of December 31, 2010 and 2011, the Company had $77,500 thousand and $72,000 thousand of cash equivalents, respectively, in US dollar denominated time deposits with original maturities of less than three months. As of December 31, 2011, cash in the amount of $40,200 thousand and time deposits in the amount of $44,000 thousand had been pledged as collateral for short term debts which would be released within one year and are therefore excluded from cash and cash equivalents for purposes of the consolidated statements of cash flows.
|
|
(d)
|
Investment Securities
|
Investment securities as of December 31, 2010 and 2011 consist of investments in marketable securities, investments in non-marketable equity securities and corporate bond. All of the Company’s investments in debt and marketable equity securities are classified as available-for-sale securities and are reported at fair value.
Available-for-sale securities, which mature or are expected to be sold in one year, are classified as current assets. Unrealized holding gains and losses, net of related taxes on available for sale securities are excluded from earnings and reported as a separate component of equity in accumulated other comprehensive income (loss) until realized. Realized gains and losses from the sale of available for sale securities are determined on a specific identification basis.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
Conversion option in the Company’s investment in corporate convertible bonds are separated from the corporate bonds and accounted for separately as the economic characteristics and risks of the corporate bonds and the conversion options are not closely related, a separate instrument with the same terms as the conversion options would meet the definition of a derivative, and the combined instrument is not measured at fair value. Changes in the fair value of the separated conversion options are recognized immediately in earnings.
Premiums and discounts on the corporate bonds are amortized over the life of the bonds as an adjustment to yield using the effective-interest method and are included in the interest income in the accompanying consolidated statements of income.
The cost of the securities sold is computed based on the moving average cost of each security held at the time of sale.
As of December 31, 2010 and 2011, the Company had $172 thousand and $1,266 thousand, respectively, of restricted marketable securities, consisting of negotiable certificate of deposits and New Taiwan dollar (NT$) and US dollar denominated time deposits with original maturities of more than three months, which had been pledged as collateral for customs duties and guarantees for government grants.
In April 2009, the FASB issued FSP FAS 115-2 and FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments (included in FASB ASC Topic 320, Investments—Debt and Equity Securities), which amends the recognition guidance for other-than-temporary impairments (OTTI) of debt securities and expands the financial statement disclosures for OTTI on debt and equity securities. When an other-than-temporary impairment has occurred, the amount of the other-than-temporary impairment recognized in earnings depends on whether a company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss. If a company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, the other-than-temporary impairment is recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. If a company does not intend to sell the security and it is not more likely than not that a company will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, the other-than-temporary impairment is separated into the amount representing the credit loss and the amount related to all other factors. The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings. The amount of the total other-than-temporary impairment related to other factors is recognized in other comprehensive income, net of applicable income taxes.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
The Company adopted the FSP in 2009, which had no impact on the Company’s consolidated earnings or consolidated financial position.
Investments in non-marketable equity securities in which the Company does not have the ability to exercise significant influence over the operating and financial policies of the investee are stated at cost. Dividends, if any, are recognized into earnings when received.
Equity investments in entities where the Company has the ability to exercise significant influence over the operating and financial policy decisions of the investee, but does not have a controlling financial interest in the investee, are accounted for using the equity method. The Company’s share of the net income or net loss of an investee is recognized in earnings from the date the significant influence commences until the date that significant influence ceases. The difference between the cost of an investment and the amount of underlying equity in net assets of an investee at investment date was amortized over useful life of related assets.
A decline in value of a security below cost that is deemed to be other than temporary a result in an impairment to reduce the carrying amount to fair value. To determine whether any impairment is other-than-temporary, management considers all available information relevant to the collectability of the security, including past events, current conditions, and reasonable and supportable forecasts, when developing estimates of cash flows to be collected. Evidence considered in this assessment includes the reasons for the impairment, the severity and duration of the impairment, changes in value subsequent to year-end, forecasted performance of the investee, and the general market condition in the geographic area or industry the investee operates in.
|
|
(e)
|
Allowance for Doubtful Accounts
|
An allowance for doubtful accounts is provided based on a review of collectability of accounts receivable on a monthly basis. In establishing the required allowance, management considers the historical collection experience, current receivable aging and the current trend in the credit quality of the Company’s customers. Management reviews its allowance for doubtful accounts quarterly. Account balance is charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
Inventories primarily consist of raw materials, work-in-process and finished goods awaiting final assembly and test, and are stated at the lower of cost or market value. Cost is determined using the weighted-average method. For work-in-process and manufactured inventories, cost consists of the cost of raw materials (primarily fabricated wafer and processed tape), direct labor and an appropriate proportion of production overheads. The Company also writes down excess and obsolete inventories to their estimated market value based upon estimations about future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional future inventory write-down may be required that could adversely affect the Company’s operating results. Once written down, inventories are carried at this lower amount until sold or scrapped. If actual market conditions are more favorable, the Company may have higher operating income when such products are sold. Sales to date of such products have not had a significant impact on the Company’s operating income.
|
|
(g)
|
Property, Plant and Equipment
|
Property, plant and equipment consists primarily of land purchased as the construction site of the Company’s new headquarters, and machinery and equipment used in the design and development of products, and is stated at cost. Depreciation on building and machinery and equipment commences when the asset is ready for its intended use and is calculated on the straight-line method over the estimated useful lives of related assets which range as follows: building 25 years, building improvements 4 to 16 years, machinery 4 to 6 years, research and development equipment 4 to 6 years, office furniture and equipment 3 to 7 years, others 2 to 10 years. Leasehold improvements are amortized on a straight line basis over the shorter of the lease term or the estimated useful life of the asset. Software is amortized on a straight line basis over the estimated useful lives ranging from 2 to 6 years.
Goodwill is an asset representing the future economic benefits arising from other assets acquired in the business combination of the Company’s acquisition of Himax Semiconductor, Inc. (formerly Wisepal Technologies, Inc.) in 2007 that are not individually identified and separately recognized. Goodwill is reviewed for impairment at least annually. Impairment testing for goodwill is done at a reporting unit level. A reporting unit is an operating segment or one level below an operating segment (also known as a component). A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available, and segment management regularly reviews the operating results of that component.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
The goodwill impairment test is a two-step test. Under the first step, the fair value of the reporting unit is compared with its carrying value (including goodwill). If the fair value of the reporting unit is less than its carrying value, an indication of goodwill impairment exists for the reporting unit and the Company must perform step two of the impairment test (measurement). Under step two, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of that goodwill. The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation, in accordance with ASC 805 (SFAS No. 141), Business Combinations. The residual fair value after this allocation is the implied fair value of the reporting unit goodwill. If the fair value of the reporting unit exceeds its carrying value, step two does not need to be performed.
In 2009 and 2010, management determined that the Company in essence only had one reporting unit for purposes of testing goodwill for impairment, which was the enterprise as a whole. Management performs the annual impairment review of goodwill at October 31, and when a triggering event occurs between annual impairment tests. Consequently, the market value based on the quoted market price of the Company’s shares was excess of the Company’s equity book value on the date of first step of the assessment in 2009 and 2010. Therefore, management concluded that the Company’s goodwill was not impaired in 2009 and 2010.
As further described in Note 2(s) below, in 2011 the Company changed its internal reporting such that the Company now has two operating, which are also reportable segments. The Company has determined that three of the components in Segment Driver IC are economically similar and is deemed a single reporting unit. As a result, the Company has five reporting units which are Driver IC, LCOS micro-displays, CMOS image sensors and wafer level optics, Chipsets for TVs and Monitors, and Others..
Management assigned the Company’s assets and liabilities to each reporting unit based on either specific identification or by using judgment for the remaining assets and liabilities that are not specific to a reporting unit. Goodwill has been assigned solely to Driver IC reporting unit because on that reporting unit is expected to benefit from the synergies of the business combination. Therefore, only Driver IC reporting unit is tested for goodwill impairment.
For Driver IC reporting unit in 2011, management compared the carrying value of Driver IC reporting unit, inclusive of assigned goodwill, to its respective fair value—step 1 of the two-step impairment test.
The discounted cash flow (DCF) method is used by management in applying the income approach to determine the fair value of each of the Company’s reporting units. Significant assumptions inherent in the valuation method for goodwill are employed and included, but are not limited to, prospective financial information, terminal value, and discount rates.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
When performing income approach for each reporting unit, the Company incorporates the use of projected financial information and a discount rate that are developed using market participant based assumptions. The cash-flow projections are based on five-year financial forecasts developed by management that include revenue projections, capital spending trends, and investment in working capital to support anticipated revenue growth, which are regularly and reviewed by management. The selected discount rate considers the risk and nature of the respective reporting unit’s cash flows and the rates of return market participants would require to invest their capital in reporting units.
In order to determine the reasonableness of the fair values of the reporting units, management performed a reconciliation of the aggregate fair values of the reporting units to the Company’s market capitalization based on the quoted market price of Himax’s ordinary shares, adjusted for an appropriate control premium. Management believes the control premium represents the additional amount that a buyer would be willing to pay to obtain a controlling voting interest in the Company as a result of the ability to take advantage of synergies and other benefits. To determine an appropriate control premium, references were made to recent and comparable merger and acquisition transactions in the SIC code 367X- Semiconductors and Related Technology industry.
Based on management’s assessments, the estimated fair value of the Driver IC reporting unit exceeded its carrying amount at October 31, 2011. Therefore, management concluded that goodwill was not impaired, and step two of the goodwill impairment test under FASB ASC Topic 350 was not necessary. In addition, no triggering events occurred between annual impairment test dates.
Acquired intangible assets include patents, developed technology and customer relationship assets at December 31, 2010 and 2011. Intangible assets are amortized on a straight-line basis over the following estimated useful lives: patents 5 to 15 years, technology 5 to 7 years and customer relationship 7 years.
|
|
(j)
|
Impairment of Long-Lived Assets
|
The Company’s long-lived assets, which consist of property, plant and equipment and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is assessed by a comparison of the carrying amount of an asset to its estimated undiscounted future cash flows expected to be generated. If the carrying amount of an asset exceeds such estimated cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds its estimated fair value. Management generally determines fair value based on the estimated discounted future cash flows expected to be generated by the asset.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
The Company recognizes revenue from product sales when persuasive evidence of an arrangement exists, the product has been delivered, the price is fixed and determinable and collection is reasonably assured. The Company uses a binding purchase order as evidence of an arrangement. Management considers delivery to occur upon shipment provided title and risk of loss has passed to the customer based on the shipping terms, which is generally when the product is shipped to the customer from the Company’s facilities or the outsourced assembly and testing house. In some cases, title and risk of loss does not pass to the customer when the product is received by them. In these cases, the Company recognizes revenue at the time when title and risk of loss is transferred, assuming all other revenue recognition criteria have been satisfied. These cases include several inventory locations where the Company manages inventories for its customers, some of which inventories are at customer facilities. In such cases, revenue is not recognized when products are received at these locations; rather, revenue is recognized when customers take the inventories from the location for their use.
The Company records a reduction to revenue and accounts receivable by establishing a sales discount and return allowance for estimated sales discounts and product returns at the time revenue is recognized based primarily on historical discount and return rates. However, if sales discount and product returns for a particular fiscal period exceed historical rates, management may determine that additional sales discount and return allowances are required to properly reflect the Company’s estimated remaining exposure for sales discounts and product returns.
Sales taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from revenues in the consolidated statements of income.
Under the Company’s standard terms and conditions of sale, products sold are subject to a limited product quality warranty. The Company may receive warranty claims outside the scope of the standard terms and conditions. The Company provides for the estimated cost of product warranties at the time revenue is recognized based primarily on historical experience and any specifically identified quality issues.
|
|
(m)
|
Research and Development and Advertising Costs
|
The Company’s research and development and advertising expenditures are charged to expense as incurred. Advertising expenses for the years ended December 31, 2009, 2010 and 2011, were $21 thousand, $161 thousand and $59 thousand, respectively.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
The Company recognizes government grants to fund research and development expenditures as a reduction of research and development expense in the accompanying consolidated statements of income based on the percentage of actual qualifying expenditures incurred to date to the most recent estimate of total expenditures for which they are intended to be compensated.
|
|
(n)
|
Employee Retirement Plan
|
The Company has established an employee noncontributory defined benefit retirement plan (the “Defined Benefit Plan”) covering full-time employees in the ROC which were hired by the Company before January 1, 2005.
The Company records annual amounts relating to its pension and postretirement plans based on calculations that incorporate various actuarial and other assumptions including discount rates, mortality, assumed rates of return, compensation increases, and turnover rates. Management reviews its assumptions on an annual basis and makes modifications to the assumptions based on current rates when it is appropriate to do so. The effect of modifications to those assumptions is recorded in accumulated other comprehensive income and amortized to net periodic cost over future periods using the corridor method. Management believes that the assumptions utilized in recording its obligations under its plans are reasonable based on its experience and market conditions.
The Company adopted the measurement date provisions of ASC 715 (SFAS No. 158), Compensation-Retirement Benefits, as of December 31, 2008 which required plan assets and benefit obligations be measured as of the date of the Company’s fiscal year-end statement of financial position which are consistent with the Company’s prior policies and the adoption of the measurement provisions of ASC 715 (SFAS No. 158) did not impact the consolidated financial statements.
The Company has adopted a defined contribution plan covering full-time employees in the ROC (the “Defined Contribution Plan”) beginning July 1, 2005 pursuant to ROC Labor Pension Act. Pension cost for a period is determined based on the contribution called for in that period. Substantially all participants in the Defined Benefit Plan have been provided the option of continuing to participate in the Defined Benefit Plan, or to participate in the Defined Contribution Plan on a prospective basis from July 1, 2005. Accumulated benefits attributed to participants that elect to change plans are not impacted by their election.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the carrying amounts of existing assets and liabilities in the financial statements and their respective tax bases, and operating loss and tax credit carry-forward. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recorded for deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized.
The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits as income tax expense in the consolidated statement of income.
|
|
(p)
|
Foreign Currency Translation and Foreign Currency Transactions
|
The reporting currency of the Company is the United States dollar. The functional currency for the Company and its major operating subsidiaries is the United States dollar. Accordingly, the assets and liabilities of subsidiaries whose functional currency is other than the United States dollar are included in the consolidation by translating the assets and liabilities into the reporting currency (the United States dollar) at the exchange rates applicable at the end of the reporting period. Equity accounts are translated at historical rates. The statements of income and cash flows are translated at the average exchange rates during the year. Translation gains or losses are accumulated as a separate component of equity in accumulated other comprehensive income (loss).
|
|
(q)
|
Earnings Per Ordinary Share
|
Basic earnings per ordinary share is computed using the weighted average number of ordinary shares outstanding during the period. Diluted earnings per ordinary share is computed using the weighted average number of ordinary and diluted ordinary equivalent shares outstanding during the period. Ordinary equivalent shares are ordinary shares that are contingently issuable upon the vesting of unvested restricted share units (RSUs) granted to employees.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
Basic and diluted earnings per ordinary share have been calculated as follows:
| |
|
Year Ended December 31,
|
|
| |
|
2009
|
|
|
2010
|
|
|
2011
|
|
| |
|
|
|
|
|
|
|
|
|
|
Net income attributable to Himax Technologies, Inc. stockholders (in thousands)
|
|
$ |
39,650 |
|
|
|
33,206 |
|
|
|
10,706 |
|
|
Denominator for basic earnings per ordinary share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares outstanding (in thousands)
|
|
|
369,652 |
|
|
|
355,037 |
|
|
|
353,771 |
|
|
Basic earnings per ordinary share attributable to Himax Technologies, Inc. stockholders
|
|
$ |
0.11 |
|
|
|
0.09 |
|
|
|
0.03 |
|
Contingently issuable ordinary shares underlying the unvested RSUs granted to employees are included in the calculation of diluted earnings per ordinary share based on treasury stock method. In 2009, the unvested 612,313 RSUs (represents 1,224,626 ordinary shares) which will vest in 2010 were excluded as their effect would be anti-dilutive. In 2011, the unvested 437,029 RSUs (represents 874,058 ordinary shares) which will vest in 2012 were excluded as their effect would be anti-dilutive.
| |
|
Year Ended December 31,
|
|
| |
|
2009
|
|
|
2010
|
|
|
2011
|
|
| |
|
|
|
|
|
|
|
|
|
|
Net income attributable to Himax Technologies, Inc. stockholders (in thousands)
|
|
$ |
39,650 |
|
|
|
33,206 |
|
|
|
10,706 |
|
|
Denominator for diluted earnings per ordinary share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares outstanding (in thousands)
|
|
|
369,652 |
|
|
|
355,037 |
|
|
|
353,771 |
|
|
Unvested RSUs (in thousands)
|
|
|
577 |
|
|
|
653 |
|
|
|
56 |
|
| |
|
|
370,229 |
|
|
|
355,690 |
|
|
|
353,827 |
|
|
Diluted earnings per ordinary share attributable to Himax Technologies, Inc. stockholders
|
|
$ |
0.11 |
|
|
|
0.09 |
|
|
|
0.03 |
|
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
|
|
(r)
|
Share-Based Compensation
|
The cost of employee services received in exchange for share-based compensation is measured based on the grant-date fair value of the share-based instruments issued. The cost of employee services is equal to the grant-date fair value of shares issued to employees and is recognized in earnings over the service period. Compensation cost also considers the number of awards management believes will eventually vest. As a result, compensation cost is reduced by the estimated forfeitures. The estimate is adjusted each period to reflect the current estimate of forfeitures, and finally, the actual number of awards that vest.
The Company uses the management approach in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company's chief operating decision maker for making operating decisions, allocating resources and assessing performance as the source for determining the Company's reportable segments.
The Company’s chief operating decision maker (“CODM”) has been identified as the Chief Executive Officer, who regularly reviews operating results to make decisions about allocating resources and assessing performance for the Company.
Prior to fiscal year 2011, based on the Company’s internal organization structure and its internal reporting, management determined that the Company did not have any operating segments as that term is defined in ASC 280 (SFAS No. 131), “Segments Reporting”.
Since January 2011, management changed the Company’s internal organization structure and its internal reporting. Consequently, management has determined that the Company now has two operating segments, Driver IC and Non-driver products, which are also reportable segments. This basis of segmentation is applied retrospectively to present segment information for 2009 and 2010.
The CODM assesses the performance of the operating segments based on segment sales and segment profit and loss. There are no intersegment sales in the segment revenues reported to the CODM. Segment profit and loss is determined on a basis that is consistent with how the Company reports operating income (loss) in its consolidated statements of operations. Segment profit (loss) excludes income taxes, interest income and expense, foreign currency exchange gains and losses, equity in the earnings (losses) of affiliates, gains and losses on valuations of financial instruments and sales of investment securities, and other income and expenses.
The Company does not report segment asset information to the Company’s CODM. Consequently, no asset information by segment is presented.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
|
|
(t)
|
Noncontrolling Interests
|
Non-controlling interests are classified in the consolidated statements of income as part of consolidated net income and the accumulated amount of non-controlling interests as part of equity in the consolidated balance sheets. If a change in ownership of a consolidated subsidiary results in loss of control and deconsolidation, any retained ownership interests are re-measured with the gain or loss reported in net earnings.
The effects of changes in the Company’s ownership interests in its subsidiaries on Himax Technologies, Inc. equity are set forth as follows:
| |
|
Year Ended December 31, |
|
| |
|
2009
|
|
|
2010
|
|
|
2011
|
|
| |
|
|
|
|
|
|
|
|
|
|
Net income attributable to Himax Technologies, Inc. stockholders
|
|
$ |
39,650 |
|
|
|
33,206 |
|
|
|
10,706 |
|
|
Transfers (to) from the noncontrolling interests:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in Himax Technologies, Inc.’s paid-in capital for sale of shares of Himax Display, Himax Analogic and Himax Media Solutions
|
|
|
285 |
|
|
|
652 |
|
|
|
(382 |
) |
|
Increase in Himax Technologies, Inc.’s paid-in capital for new shares issued by Himax Display, and Himax Media Solutions
|
|
|
35 |
|
|
|
- |
|
|
|
- |
|
|
Decrease in Himax Technologies, Inc.’s paid-in capital for purchase of new shares issued by Himax Analogic
|
|
|
(242 |
) |
|
|
- |
|
|
|
- |
|
|
Net transfers from noncontrolling interests
|
|
|
78 |
|
|
|
652 |
|
|
|
(382 |
) |
|
Change from net income attributable to Himax Technologies, Inc. stockholders and transfers from noncontrolling interests
|
|
$ |
39,728 |
|
|
|
33,858 |
|
|
|
10,324 |
|
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
|
|
(u)
|
Fair Value Measurements
|
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair values of cash, cash equivalents, accounts receivable, restricted cash and cash equivalents, short-term debt, accounts payable and accrued liabilities approximate their carrying values due to their relatively short maturities. Marketable securities consisting of open-ended bond funds are reported at fair value based on quoted market prices at the reporting date. Marketable securities consisting of time deposits with original maturities more than three months are determined using the discounted present value of expected cash flows. The fair value of the corporate straight bonds was initially determined by subtracting the fair value of the embedded conversion option from the fair value of the combined instrument. The embedded conversion options and the subsequent measurement of the corporate straight bond are reported at fair value based on discounting estimated future cash flows based on the terms and maturity of each instrument and using market interest rates for a similar instrument at the reporting date. Fair values reflect the credit risk of the instrument and include adjustments to take account of the credit risk of the Company and counterparty when appropriate. The fair value of equity method investments and cost method investments have not been estimated as there are no identified events or changes in circumstances that may have significant adverse effects on the carrying value of these investments, and it is not practicable to estimate their fair values.
A fair value hierarchy exists that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:
|
|
(i)
|
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
|
|
|
(ii)
|
Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
|
|
|
(iii)
|
Level 3 inputs are unobservable inputs for the asset or liability.
|
The level in the fair value hierarchy within which a fair measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement in its entirety.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
|
|
(v)
|
Recently Issued Accounting Standards
|
In December 2011, the FASB issued ASU No. 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. ASU 2011-11 requires an entity to disclose information about offsetting and related arrangements to enable users of financial statements to understand the effect of those arrangements on its financial position, and to allow investors to better compare financial statements prepared under U.S. GAAP with financial statements prepared under International Financial Reporting Standards (IFRS). The new standards are effective for annual periods beginning January 1, 2013, and interim periods within those annual periods. Retrospective application is required. The Company will implement the provisions of ASU 2011-11 as of January 1, 2013.
In June 2011, the FASB issued ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. Under this ASU, an entity will have the option to present the components of net income and comprehensive income in either one or two consecutive financial statements. The ASU eliminates the option in U.S. GAAP to present other comprehensive income in the statement of changes in equity. An entity should apply the ASU retrospectively. In December 2011, the FASB decided to defer the effective date of those changes in ASU 2011-05 that relate only to the presentation of reclassification adjustments in the statement of income by issuing ASU 2011-12, Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive income in Accounting Standards Update 2011-05. The Company already presents a separate statement of other comprehensive income following the statement of income.
Reclassifications
Certain prior year amounts have been reclassified to conform to the current year presentation.
|
Note 3.
|
Investments in Marketable Securities Available-for sale
|
Following is a summary of marketable securities as of December 31, 2010 and 2011:
| |
|
December 31, 2010
|
|
| |
|
Aggregate
|
|
|
Gross
Unrealized
Gains
|
|
|
Gross
Unrealized
Losses
|
|
|
Aggregate
Market
Value
|
|
| |
|
(in thousands)
|
|
|
Time deposit with original maturities more than three months
|
|
$ |
150 |
|
|
|
21 |
|
|
|
- |
|
|
|
171 |
|
|
Open-ended bond fund
|
|
|
7,995 |
|
|
|
466 |
|
|
|
- |
|
|
|
8,461 |
|
|
Total
|
|
$ |
8,145 |
|
|
|
487 |
|
|
|
- |
|
|
|
8,632 |
|
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
| |
|
December 31, 2011
|
|
| |
|
Aggregate
Cost
|
|
|
Gross
Unrealized
|
|
|
Gross
Unrealized
Losses
|
|
|
Aggregate
Market
Value
|
|
| |
|
(in thousands)
|
|
|
Time deposit with original maturities more than three months
|
|
$ |
150 |
|
|
|
15 |
|
|
|
- |
|
|
|
165 |
|
|
Open-ended bond fund
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Total
|
|
$ |
150 |
|
|
|
15 |
|
|
|
- |
|
|
|
165 |
|
The Company’s portfolio of available for sale marketable securities by contractual maturity or the expected holding period as of December 31, 2010 and 2011 is due in one year or less.
Information on sales of available for sale marketable securities for the years ended December 31, 2009, 2010 and 2011 is summarized below.
|
Period
|
|
Proceeds
from sales
|
|
|
Gross
realized gains
|
|
|
Gross
realized losses
|
|
| |
|
(in thousands) |
|
| |
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2009
|
|
$ |
39,263 |
|
|
|
179 |
|
|
|
(266 |
) |
|
Year ended December 31, 2010
|
|
$ |
33,443 |
|
|
|
326 |
|
|
|
(30 |
) |
|
Year ended December 31, 2011
|
|
$ |
25,834 |
|
|
|
420 |
|
|
|
(70 |
) |
|
Note 4.
|
Allowance for Doubtful Accounts, Sales Returns and Discounts
|
The activity in the allowance for doubtful accounts, sales returns and discounts for the years ended December 31, 2009, 2010 and 2011 follows:
Allowance for doubtful accounts
|
Period
|
|
Balance at
beginning
of year
|
|
|
Charges
(credits) to
earnings
|
|
|
Amounts
utilized
|
|
|
Balance at
end of
year
|
|
| |
|
(in thousands)
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year ended December 31, 2009
|
|
$ |
25,297 |
|
|
|
218 |
|
|
|
- |
|
|
|
25,515 |
|
|
For the year ended December 31, 2010
|
|
$ |
25,515 |
|
|
|
(8,788 |
) |
|
|
- |
|
|
|
16,727 |
|
|
For the year ended December 31, 2011
|
|
$ |
16,727 |
|
|
|
(1,541 |
) |
|
|
- |
|
|
|
15,186 |
|
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
Allowance for sales returns and discounts
|
Period
|
|
Balance at
beginning
of year
|
|
|
Additions
|
|
|
Amounts
utilized
|
|
|
Balance at
end of
year
|
|
| |
|
(in thousands)
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year ended December 31, 2009
|
|
$ |
162 |
|
|
|
2,391 |
|
|
|
(1,583 |
) |
|
|
970 |
|
|
For the year ended December 31, 2010
|
|
$ |
970 |
|
|
|
4,551 |
|
|
|
(4,930 |
) |
|
|
591 |
|
|
For the year ended December 31, 2011
|
|
$ |
591 |
|
|
|
3,385 |
|
|
|
(3,191 |
) |
|
|
785 |
|
|
Note 5.
|
Equity Method Investments
|
As of December 31, 2010 and 2011, equity method investments consisted of the following:
| |
|
December 31,
|
|
| |
|
2010
|
|
|
2011
|
|
| |
|
Amount
|
|
|
Holding
%
|
|
|
Amount
|
|
|
Holding
%
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Hangzhou Crystal Display Technology Co., Ltd.
|
|
$ |
125 |
|
|
|
30.00 |
|
|
|
- |
|
|
|
- |
|
|
Create Electronic Optical Co., Ltd.
|
|
|
744 |
|
|
|
21.11 |
|
|
|
439 |
|
|
|
21.11 |
|
| |
|
$ |
869 |
|
|
|
|
|
|
|
439 |
|
|
|
|
|
Investments accounted for under the equity method consist of Hangzhou Crystal Display Technology Co., Ltd. (Crystal, newly incorporated in May, 2009) that were purchased in June 2009 and Create Electronic Optical Co., Ltd. (C.E.O.) that were purchased in March 2010. Crystal is LCOS project module company and C.E.O. is a camera module supplier.
The Company disposed of Crystal equity to its other shareholders in June 2011 and resulted in $ 313 thousand gain on disposal of Crystal, which was presented in other income in the accompanying consolidated statement of income.
At investment date, the difference between the carrying amount of the Company’s investment in C.E.O. and the underlying equity in the net assets of C.E.O. was $370 thousand which was resulting from C.E.O.’s identifiable intangible assets and was amortized over 3 years. At the December 31, 2011, the excess of cost of such investment in C.E.O. over the Company’s share of the net assets of C.E.O. was $162 thousand.
As of December 31, 2011, it was not practicable for management to estimate the fair value of the Company’s investments in C.E.O. due to the lack of quoted market price and the inability to estimate the fair value without incurring excessive costs. However, management identified no events or changes in circumstance that may significantly affect the Company’s ability on recovering the carrying values of the investment.
HIMAX TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
December 31, 2009, 2010 and 2011
As of December 31, 2010 and 2011, inventories consisted of the following:
| |
|
December 31,
|
|
| |
|
2010
|
|
|
2011
|
|
| |
|
(in thousands)
|
|
| |
|
|
|
|
|
|
|
Finished goods
|
|
$ |
38,709 |
|
|
|
30,703 |
|
|
Work in process
|
|
|
66,271 |
|
|
|
57,737 |
|
|
Raw materials
|
|
|
12,987 |
|
|
|
24,505 |
|
|
Supplies
|
|
|
21 |
|
|
|
40 |
|
| |
|
$ |
117,988 |
|
|
|
112,985 |
|
Inventory write-downs were $13,622 thousand, $10,557 thousand and $9,138 thousand for the years ended December 31, 2009, 2010 and 2011, respectively, and are included in cost of revenues.
|
Note 7.
|
Intangible Assets, Other than Goodwill
|
| |
|
December 31, 2010
|
|
| |
|
Gross
carrying
amount
|
|
Weighted
average
amortization
period
|
|
Accumulated
amortization
|
|
| |
|
(in thousands)
|
|
| |
|
|
|
|
|
|
|
|
Technology
|
|
$ |
6,339 |
|
7 years
|
|
|
3,609 |
|
|
Customer relationship
|
|
|
8,100 |
|
7 years
|
|
|
4,532 |
|
|
Patents
|
|
|
842 |
|
6 years
|
|
|
466 |