14
M A N AGE ME N T RE P O RT - P ERFO RM A N C E A N D O U T LO O K
PERFORMANCE IN 2020
The average exchange rate of USD to DKK during 2020
BALANCE SHEET
STATEMENT OF CASH FLOWS
was 3% lower than the average rate in 2019. Approxi-
Asetek’s total assets at December 31, 2020 were $71.4
Net cash provided by operating activities was $11.4 million
PROFIT AND LOSS
mately 77% of the Company’s operating expense in 2020
million, compared with $54.1 million at the end of 2019.
in 2020 ($8.9 million provided in 2019). The increase
Total revenue for 2020 was $72.8 million, representing
was denominated in DKK (78% in 2019), resulting in an
The principal components of this change include: trade
from 2019 was principally due to increased net income in
growth of 34% from 2019 ($54.3 million). Sealed loop
unfavorable impact to operating expense in 2020 when
receivables increased by $10.0 million as a result of a 78%
2020, partly offset by growth in receivables and inventory
cooling unit shipments for 2020 totalled 1.2 million, a
compared with 2019.
increase in fourth quarter 2020 revenue compared with
associated with higher operating volumes.
34% increase over 2019 (895 thousand). Average Selling Prices (ASP) for the year 2020 decreased to $53.91 from $57.88 in 2019. Gross margin increased to 47.0% in 2020 from 42.3% in 2019. The above fluctuations reflect increased demand in the Gaming and Enthusiast market and Asetek’s business model transition. Shipments under
Adjusted EBITDA was $15.6 million in 2020, compared with $6.2 million in 2019. Adjusted EBITDA in 2020 represents operating income of $10.9 million, plus depreciation of $3.8 million, plus share-based compensation of $0.9 million.
the same period of prior year; cash and cash equivalents increased by $2.6 million due to net income growth partly offset by share repurchases; intangibles increased by $1.3 million from a business acquisition during the year. In November 2020, the Company acquired JMH Gallows Pound Technologies Ltd., a UK-based developer
Cash used by investing activities was $4.8 million, related to additions to intangible assets and purchase of property and equipment. The increase from prior year is principally due to the previously mentioned $1.4 million business acquisition and purchase of equipment for data center manufacturing ($1.8 million used in 2019).
the new model have lower ASPs as Asetek moves to de-
Foreign currency transactions in 2020 resulted in a $1.4
of hardware and software technology and owners of the
livering only the principal core technology with improved
million loss ($0.2 million gain in 2019).
UltimateGameTech brand, for a sum of GBP 1 million
Cash used by financing activities was $5.1 million in 2020,
(approximately $1.4 million).
including $6.4 million for the repurchase of Asetek’s com-
margins, while the customer adds their unique features with ancillary components. In 2020, total operating expense was $23.3 million, a 6.0% increase from 2019 ($22.0 million), reflecting investment in the Company’s infrastructure. During 2020, Asetek increased staffing by 35% to support revenue growth.
Income tax expense of $0.2 million in 2020 decreased from 2019 ($2.1 million) due to increased utilization of
Total liabilities increased by $8.8 million in 2020, resulting
deferred tax assets during the year.
principally from growth in operating volumes and related
Asetek's total comprehensive income was $11.6 million for 2020, compared with total comprehensive loss of $1.1 million in 2019. Comprehensive income included a positive
Legal cost incurred associated with defense of existing
$2.4 million translation adjustment in 2020 (negative
IP and securing new IP was $2.4 million in 2020 ($2.7
$0.4 million in 2019).
incentive compensation for employees. Trade payables, accrued compensation and employee benefits, and accrued liabilities increased by $5.9 million and $1.7 million, and $1.4 million respectively. The increase in trade payables is also partly the result of
million). Fiscal year 2019 operating expense included an
the Company's proactive management of suppliers and
offset of $0.8 million for settlements awarded to Asetek in
timing of payments.
patent infringement lawsuits. Share-based compensation cost associated with warrants and options issued to employees was $0.9 million in 2020 ($1.1 million).
L I Q UI D CO OLI NG DO N E RIGHT
mon shares and $0.8 million for payments on capitalized leases. The Company also paid down its line of credit by $0.3 million. These effects were partly offset by $2.4 million received for shares issued on options exercised by employees ($0.6 million used in 2019). Net increase in cash and cash equivalents was $2.6 million in 2020, compared with increase of $5.9 million in 2019.
