AUGUST 7--DALSA Corp. (Waterloo, ON, Canada; www.dalsa.com), a global supplier of digital imaging products and platforms and a provider of semiconductor products and services, reported its second-quarter financial results for the period ended June 30, 2003. Total revenues for the quarter was $32.7 million, a 2.1% increase from $32.0 million in the second quarter last year and a 2.2% decrease compared to the first quarter of 2003. Net income was $2.3 million or $0.14 per share as compared to net income of $3.4 million or $0.25 per share in the second quarter of 2002. Due to the rapid appreciation of the Canadian dollar relative to the US dollar, the company recorded a foreign exchange pre-tax expense of $1.3 million in the quarter compared to a $0.8 million expense in the second quarter of last year. To mitigate some of the risk of exposure to currency fluctuations in the second half of 2003, the company purchased forward exchange contracts during the quarter.
Standard product revenues were $31.5 million compared to $29.6 million in the second quarter of last year and $31.3 million in the first quarter of 2003. The growth in standard product sales is due mainly to semiconductor business, which realized a $2.1 million or 18.7% increase (excluding inter-segment sales) compared to the same period last year and a $0.2 million or 1.8% increase compared to the first quarter of 2003. Both the semiconductor-business and the digital-imaging-business revenues increased quarter over quarter on a units sold basis. Despite the strengthening of the Canadian dollar, total backlog for the company (excluding intersegment sales) increased from $36.6 million at the end of the first quarter to $38.7 million at the end of the second quarter.
"Unit sales are increasing across the company, and our business is sound. We are well positioned to benefit from the recovery of the semiconductor market," comments Savvas Chamberlain, CEO of DALSA Corp. "Unit sales in our digital-imaging business have increased sequentially by quarter and we expect this growth to continue through 2003. Forecasts in our semiconductor business continue to improve for 2003, with a book-to-bill ratio greater than 1.0 in the second quarter. Companywide, our order backlog has once again increased, which is a strong indicator of improvement in customer sentiment in the semiconductor and electronics markets."
R&D expenses, net of government grants and investment tax credits, were $4.4 million (13.4% of total revenue) in the current quarter as compared to $3.9 million (12.1% of total revenue) in the second quarter of last year. The company's guidelines for spending on R&D are 14% to 16% of total revenues.