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OLED Q4 CC notes

Q4 CC notes - 

- Q4 Revenue $49.5M, EPS 0.35/sh2013 Revenue $146.6M, EPS 0.70/shCash $272.6M at EOY, up $45M in 2013 vs. $17.8M in 2012.

- 2014 Revenue guidance is $190-$205M, which includes a $50M Samsung royalty payment. They are forecasting materials revenue will grow 50% in 2014, based primarily on capacity growth in 2H2014.

- OLED discussions have heated up in Japan and China.

- Material breakdown, due to expected seasonal declines vs Q3.Green emitter - $11.6M vs. $13.6MGreen host - $9.3M vs. $11.2MRed emitter - $2.8M vs. $3.4M

- The revenue beat versus the tight Q4 range given in November was across the board, materials and license fees. 

- The Konica License Agreement was a standard, post-Samsung agreement, with an up-front component and royalties.

- Re-iterated GM's of 40-50% on host and 70-80% on emitters, expect those to be maintained throughout 2014, do not see any meaningful impact from volume discounts.

- Did not answer a question on whether their green materials were in Samsung's wearables.

- Expect R&D to move 15% higher, even though there was a greater quarterly bump in Q4.

- Answered a question about new customers by saying nothing has changed, but highlighted they are expecting 50% materials growth in 2014.

- There has been No Change and No Impact with regard to the adverse patent ruling in November, it has not even been discussed by their customers.

- They have 15-20 customers today in varying volumes. They have no updates on progress with blue or with customers adopting new materials. There is a lot of customer interest in the existing green materials.

- Said lighting revenues would be less than 10% of 2014 revenues, which is different than their comments prior that it was 5% of revenue.

- Said all the TV's are currently from prototype lines, so too early to tell what material usage will be for TV's versus mobile. 

- No new uses for the growing cash balance.

- Did not have an answer for backplane upgrades at Samsung.

- Said $1.5M of the increase in non-Samsung license revenue was a Seiko/Epson upfront fee that was moved to current revenue since they are not proceeding with their plans. The remainder is the portion of license fees built into material prices.

- Said capacity additions at their customers is where the revenue growth in the forecast is coming from, primarily in 2H2014. They are not forecasting new materials in their guidance.


Ron Mertens
Thanks Cooters. By the way -

Thanks Cooters. By the way - the $50 Samsung payment is a license fee and not royalties.

In the context of the notes

In the context of the notes they are the same thing, it is a $50M fixed license payment in lieu of variable royalties. In no context is it $50, which will barely buy you a cheap hooker. :)

Ron Mertens
Er, sorry for the $50. But I

Er, sorry for the $50. But I think that that's the exact difference between royalties and license fees, no? A license fee is fix while royalties are calculated as a portion of actual sales.

Kyulux - Hyperfluoresence OLED emittersKyulux - Hyperfluoresence OLED emitters