GigaMedia (US:GIGM)2021-04-28 16:00Revenue and Profitability - Operating revenues in 2020 increased by 3.5% to US$6.875 million from US$6.645 million in 2019, despite a decline in mobile game revenues[191] - Gross profit for 2020 was US$3.919 million, with a gross profit margin of 57.0%, up from 53.9% in 2019[192] - The company experienced a loss from operations of US$2.152 million in 2020, an improvement from a loss of US$3.015 million in 2019[193] - Revenues from a specific PC-based sports game increased by 126.8% to US$2.7 million in 2020, driven by revitalization efforts[191] Operating Expenses - Total operating expenses decreased by 8.0% to US$6.071 million in 2020, following a 20.9% decrease in 2019[193] - Product development and engineering expenses in 2020 were US$1.327 million, reflecting an 11.9% increase from US$1.186 million in 2019[193] - Selling and marketing expenses decreased by 18.9% to US$1.618 million in 2020 from US$1.995 million in 2019, due to enhanced marketing efficiency[195] - General and administrative expenses remained stable at US$3.121 million in 2020, comparable to 2019[195] Cash Flow and Investments - The net cash used in operating activities in 2020 was approximately US$2.1 million, with cash collected from customers amounting to US$6.5 million[203] - The net cash used in investing activities in 2020 was US$10.1 million, primarily for the purchase of a convertible note of Aeolus[204] - The company maintained cash, cash equivalents, and restricted cash of US$46.0 million at the end of 2020, down from US$58.3 million in 2019[203] - The company has zero bank borrowing as of December 31, 2020, and has established strong relationships with financial institutions for potential credit lines[200] Research and Development - The company invested US$1.3 million in developing its own offerings in 2020, continuing a trend of increasing investment in product development[189] - The company incurred US$1.3 million in research and development activities in 2020, up from US$1.2 million in 2019[209] Future Plans and Strategy - The company is transitioning its game portfolio from PC-based formats to browser/mobile games to capitalize on growth trends in the digital entertainment industry[211] - The company plans to adjust capital expenditures based on cash flow from operations and market conditions for 2021[206] Non-Operating Income - In 2020, the company recognized non-operating income of US$0.9 million, a decrease of 36.7% from US$1.4 million in 2019, primarily due to a drop in interest income to US$613 thousand from US$1.5 million[198] Capital Expenditures - The gross capital expenditures for 2020 were US$32 thousand, primarily for software and computer hardware equipment[206] - The company has a legal reserve of approximately US$1.5 million as of December 31 for the years 2018, 2019, and 2020[207]