<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 3, 2000
- -------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): January 24, 2000
DSP GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
0-23006 94-2683643
(Commission File Number) (I.R.S. Employer Identification No.)
3120 SCOTT BOULEVARD, SANTA CLARA, CA 95054
(Address of Principal Executive Offices) (Zip Code)
408/986-4300
(Registrant's Telephone Number, Including Area Code)
With a copy to:
Bruce Alan Mann, Esq.
Morrison & Foerster LLP
425 Market Street
San Francisco, CA 94105
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<PAGE>
ITEM 5. OTHER EVENTS.
The press release of DSP Group, Inc., dated January 24, 2000,
attached and filed herewith as Exhibit 99.1, is incorporated herein by
reference. The press release announced DSP Group's (i) financial results for
the fourth quarter ended December 31, 1999 and (ii) approval of a two-for-one
stock split in the form of a dividend. The dividend will be payable on March
1, 2000 to stockholders of record as of February 16, 2000.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
c. Exhibits
<TABLE>
<CAPTION>
Exhibit No. Description
- ---------- -----------
<S> <C>
99.1 Press release of DSP Group, Inc., dated January 24, 2000.
</TABLE>
2
<PAGE>
SIGNATURES
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 hereunto duly authorized.
DSP GROUP, INC.
Date: February 3, 2000 By: /s/ MOSHE ZELNIK
----------------
Moshe Zelnik
Vice President, Finance,
Chief Financial Officer
and Secretary
3
<PAGE>
DSP GROUP, INC. REPORTS FINANCIAL RESULTS
FOR FOURTH QUARTER 1999
AND ANNOUNCES A TWO-FOR-ONE STOCK SPLIT
- - ALL-TIME RECORD HIGH REVENUES - $25,973,000.
- - ALL-TIME RECORD HIGH EPS (EXCLUDING ONE-TIME GAINS) - $0.50
SANTA CLARA, CALIFORNIA -- January 24, 2000 -- DSP Group, Inc. (NASDAQ:
DSPG) today announced its financial results for the fourth quarter ended
December 31, 1999.
Fourth quarter revenues were $25,973,000, an increase of 84%, compared
to $14,117,000 in the same quarter of 1998. Total revenues for 1999 were
$76,433,000, an increase of 20% compared to $63,850,000 during 1998.
Net income for the fourth quarter was $33,918,000, an increase of 878%,
compared to $3,468,000 for the comparable quarter of 1998. Earnings per share
were $2.46 (diluted), an increase of 583% compared to $0.36 in the fourth
quarter of 1998. Net income for 1999 was $54,579,000, an increase of 279%
over the net income of $14,415,000 in 1998. Earnings per share for 1999 were
$4.29, an increase of 198% above earnings per share of $1.44 during the same
period of 1998.
Results for the fourth quarter and annual 1999 include one-time capital
gains of $47,151,000 and $58,931,000, respectively, resulting from the public
offering and from the sale of shares of DSP Group's affiliate, AudioCodes
Ltd, in the fourth quarter and annual 1999. These one-time gains are included
under "Other income (expense)" in the Company's statements of income. DSP
Group still holds approximately 2.9 Million of AudioCodes' shares which
represent approximately 15% of the outstanding shares.
Excluding the effect of the one-time capital gains, pro-forma net income
for the fourth quarter and annual 1999 were $6,867,000 or $0.50 (diluted) per
share and $16,948,000 or $1.33 (diluted) per share, respectively, compared to
$ 3,468,000 or $ 0.36 (diluted) per share and $ 13,600,000 or $ 1.36
(diluted) per share in the equivalent periods in 1998.
<PAGE>
During 1999, the company significantly increased its research and development
and sales and marketing expenses to support its new product introductions.
These expense increases, which were undertaken to build future revenues
resulted in a decreased operating income compared to 1998.
During the fourth quarter of 1999, a major international corporation
signed a licensing agreement with DSP Group, for its PalmDSPCore-Registered
Trademark-.
Eli Ayalon, President and CEO of DSP Group stated, "We are very pleased
with the fourth quarter 1999 results. We managed to increase our EPS by 39%
(excluding the one time gain) over the fourth quarter of 1998, despite an
increase of 55% in R&D and 102% in sales & marketing expenses compared to the
fourth quarter of 1998."
The Company Board has approved a two-for-one stock split in the form of
a 100% stock dividend payable to stockholders of record as of February 16,
2000. The dividend will be payable on March 1, 2000 to shareholders of record
as of February 16, 2000.
DSP Group, Inc. is a leader in the development and marketing of
high-performance, cost-effective digital signal processing cores used in a
wide range of applications for industries such as wireless communications,
telephony and personal computing. By combining its DSP core technology with
its advanced speech processing algorithms, DSP Group also delivers a wide
range of enabling application-specific ICs, such as ICs for fully featured
Integrated Digital Telephony, for 900 MHz Spread Spectrum wireless telephony
products and for IP telephony applications
Statements contained in this release concerning the Companies ability to
meet its goals for the year 2000 may constitute forward-looking statements.
These statements involve certain risks and uncertainties such as acceptance
of the company's new products by existing OEM customers and potential
customers, the ability of the company to produce its new products at
competitive costs, the volume and timing of product orders and the number and
timing of new licensing agreements.
Additional information is available on the World Wide Web at
www.dspg.com. This press release is also available through the company's News
on Call fax service, which can be reached at (800) 758-5804, company code
112025. For more information, please contact Michael Cohen, DSP Group, Santa
Clara, CA. (408) 986-4300.
# # #
PalmDSPCore is a registered trademark of DSP Group, Inc.
<PAGE>
DSP GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Year Ended
December 31, December 31,
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Product sales $ 19,923 $ 9,302 $ 57,397 $ 49,252
Licensing, royalties and other 6,050 4,815 19,036 14,598
-------- ------- -------- --------
Total revenues 25,973 14,117 76,433 63,850
Cost of revenues:
Product sales 11,506 5,304 33,051 29,002
Licensing, royalties and
Other 49 71 155 426
-------- ------- -------- --------
Total cost of revenues 11,555 5,375 33,206 29,428
-------- ------- -------- --------
Gross profit 14,418 8,742 43,227 34,422
Operating expenses:
Research and development 4,402 2,847 15,404 10,181
Sales and marketing 2,801 1,388 9,309 5,222
General and administrative 1,698 1,103 5,511 4,632
Total operating expenses 8,901 5,338 30,224 20,035
-------- ------- -------- --------
Operating income 5,517 3,404 13,003 14,387
Other income (expense):
Interest and other income 2,254 1,026 6,048 3,810
Interest expense and other (70) (57) (232) (189)
Gain on sale of marketable
Equity security --- --- --- 1,086
Equity in income of equity method
investees, net 789 248 2,475 125
Capital gain 47,151 --- 58,931 ---
-------- ------- -------- --------
Income before provision for
Income taxes 55,641 4,621 80,225 19,219
Provision for income taxes 21,723 1,153 25,646 4,804
-------- ------- -------- --------
Net income $ 33,918 $ 3,468 $ 54,579 $ 14,415
-------- ------- -------- --------
-------- ------- -------- --------
Net income per share:
Basic $ 2.70 $ 0.37 $ 4.65 $ 1.48
Diluted $ 2.46 $ 0.36 $ 4.29 $ 1.44
Shares used in per
Share computations:
Basic 12,543 9,401 11,734 9,768
Diluted 13,803 9,587 12,721 10,016
</TABLE>
<PAGE>
DSP GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
<TABLE>
<CAPTION>
December 31, December 31,
1999 1998
---- ----
<S> <C> <C>
ASSETS
Current Assets:
Cash, cash equivalents and
marketable securities $ 161,371 $ 66,989
Accounts receivable, net 10,435 5,721
Inventories 3,283 2,182
Deferred income taxes 1,707 1,374
Other accounts receivable 1,362 1,608
--------- --------
Total current assets 178,158 77,874
Property and equipment, net 6,948 4,236
Other investments, net of accumulated
amortization 18,433 1,834
Other assets 1,250 135
Severance pay fund 1,390 864
Deferred income taxes -- 848
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Total Assets $ 206,179 $ 85,791
--------- --------
--------- --------
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 6,079 $ 2,360
Other current liabilities 8,332 6,841
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Total current liabilities 14,411 9,201
Long term liabilities
Accrued severance pay 1,431 895
Deferred income taxes 6,380 --
Stockholders' equity:
Common stock 12 9
Additional paid-in capital 119,163 75,610
Retained earnings 64,782 12,129
Less cost of treasury stock --- (12,053)
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Total stockholders' equity 183,957 75,695
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Total liabilities and
Stockholders' equity $ 206,179 $ 85,791
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</TABLE>
