ZHUHAI, China, November 4, 2014 /PRNewswire/ — Actions Semiconductor Co., Ltd. (Nasdaq: ACTS) (“Actions Semiconductor” or “the Company”), one of China’s leading fabless semiconductor companies that provides comprehensive portable multimedia and mobile internet system-on-a-chip (SoC) solutions for portable consumer electronics, today reported its financial results for the third quarter ended September 30, 2014.

All financial results are reported on a U.S. GAAP basis.

Revenue for the third quarter of 2014 was $13.1 million, as compared to revenue of $12.0 million for the second quarter of 2014, and $16.9 million for the third quarter of 2013.

Net loss attributable to Actions Semiconductor’s shareholders for the third quarter of 2014 was $9.2 million or $0.137 per basic and diluted American Depositary Share (“ADS”). This compares to net loss attributable to Actions Semiconductor’s shareholders of $3.5 million or $0.050 per basic and diluted ADS, for the second quarter of 2014, and net loss attributable to Actions Semiconductors shareholders of $0.2 million or $0.002 per basic and diluted ADS, for the third quarter of 2013.

Actions Semiconductor reported gross margin of 14.6% for the third quarter of 2014, compared to gross margin of 18.4% for the second quarter of 2014, and 33.2% for the third quarter of 2013. Gross margin was impacted by fierce competition in the tablet market and a net inventory write-down that reduced margin by nearly 7%. The Company ended the third quarter with $161.3 million in cash and cash equivalents, together with time deposits, trading securities and marketable securities, current and non-current.

Since the share repurchase program commenced in 2007, the Company has invested approximately $78.9 million in repurchasing its ADSs and ordinary shares, including $25.0 million representing the equivalent of 10.0 million ADSs repurchased through a Dutch auction tender offer in September 2014. As of September 30, 2014, the equivalent of approximately 33.7 million ADSs were repurchased.

“In the third quarter of 2014, revenue came in toward the low end of our expectations, primarily due to a supply shortage of 8-inch wafers for multimedia products from our foundry. Competition in the worldwide tablet market remained intense, keeping selling prices and margins low. Lower gross margin, combined with mask expenses related to our new application processor enabled by 28nm process technology and expenses related to our Dutch auction tender offer contributed to the loss for the quarter,” stated Dr. Zhenyu Zhou, CEO of Actions Semiconductor.

“Shipments of dual-core solutions accounted for the majority of tablet shipments during the quarter, and we saw a twofold increase in shipments of quad-core solutions, indicative of the accelerated migration from dual-core to quad-core solutions in the overseas tablet market. We expect another sequential increase in shipments in the fourth quarter, although challenging conditions in the tablet market will persist for the next few quarters.

“As we approach the end of 2014, we believe we are through the most challenging period in our tablet business and are preparing to harvest our investments in 28nm process technology and 64-bit architecture in the year ahead. We recently launched our first 28nm OWL series chipset, the ATM7059, which will target the branded and whitebox tablet market and Over-the-top (“OTT”) set-top box market, with a 64-bit solution to be launched before year end. We also see strong potential in the Bluetooth boombox market, especially our Bluetooth 4.0 solutions, which we expect to be a major revenue driver in 2015 following the launch of our RF and audio processing integrated single chip SoC for Bluetooth boomboxes and headphones,” Dr. Zhou concluded.

Business Outlook

The following statements are based upon management’s current expectations. These statements are forward-looking, and actual results may differ materially. The Company undertakes no obligation to update these statements.

Based on current market trends, the Company expects revenue in the fourth quarter of 2014 to be in the range of $14.0 to $16.0 million. The Company expects a sequential improvement in shipments in the fourth quarter of 2014, although challenging conditions in the tablet market will continue to impact revenue and margins in the near term.

Conference Call Details

Actions Semiconductor’s third quarter of fiscal year 2014 teleconference and webcast is scheduled to begin at 8:00 a.m. Eastern Time, on Tuesday, November 4, 2014. To participate in the live call, analysts and investors should dial 1-888-427-9419 (within U.S.) or 1-719-325-2463 (outside U.S.) at least ten minutes prior to the call. The conference ID number is 2795511. Actions Semiconductor will also offer a live and archived webcast of the conference call, accessible from the “Investor Relations” section of the Company’s website at www.actions-semi.com. An audio replay of the call will be available to investors through November 14, 2014 by dialing 1-888-203-1112 (within U.S.) or 1-719-457-0820 (outside U.S.) and entering access code 2795511.

About Actions Semiconductor

Actions Semiconductor is one of China’s leading fabless semiconductor companies that provides comprehensive portable multimedia and mobile internet system-on-a-chip (SoC) solutions for portable consumer electronics. Actions Semiconductor products include SoCs, firmware, software, solution development kits, as well as detailed specifications of other required components. Actions Semiconductor also provides total product and technology solutions that allow customers to quickly introduce new portable consumer electronics to the mass market in a cost effective way. The Company is headquartered in Zhuhai, China, with offices in Shanghai, Shenzhen, Hong Kong and Taipei. For more information, please visit the Actions Semiconductor website at http://www.actions-semi.com.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

Statements contained in this release that are not historical facts are forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements concerning the outlook for its new products enabled by 28nm process technology and 64-bit CPU for tablets and high-end OTT set-top boxes and new RF and audio processing integrated single chip SoC for Bluetooth boomboxes, customer acceptance of the Actions Semiconductors new products and corresponding increases in market share, Actions Semiconductor’s belief that it is through the most challenging period in its tablet business and is positioned to capture some upside from its new products and Actions Semiconductor’s future expectations with respect to revenue. Actions Semiconductor uses words like “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project” and similar expressions to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements are estimates reflecting current assumptions, expectations and projections about future events and involve significant risks, both known and unknown, uncertainties and other factors that may cause Actions Semiconductor’s actual performance, financial condition or results of operations to be materially different from those suggested by the forward-looking statements including, among others, customers’ cancellation or modification of their orders; our failure to accurately forecast demand for our products; the loss of, or a significant reduction in orders from, any of our significant customers; fluctuations in our operating results; our inability to develop and sell new products; defects in or failures of our products; the expense and uncertainty involved in our customer design-win efforts; the financial viability of the distributors of our products; consumer demand; worldwide economic and political conditions; fluctuations in our costs to manufacture our products; our reliance on third parties to manufacture, test, assemble and ship our products; our ability to retain and attract key personnel; our ability to compete with our competitors; and our ability to protect our intellectual property rights and not infringe the intellectual property rights of others. Other factors that may cause our actual results to differ from those set forth in the forward-looking statements contained in this press release and that may affect our prospects in general are described in our filings with the Securities and Exchange Commission, including our most recently filed Forms F-1, 20-F and 6-Ks. Other unknown or unpredictable factors also could have material adverse effects on Actions Semiconductor’s future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this press release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this press release. Except as required by law, Actions Semiconductor undertakes no obligation and does not intend to update or revise any forward-looking statement to reflect subsequent events or changed assumptions or circumstances.

Investor Contacts:

Elaine Ketchmere, CFA

Ally Xie, CA, CPA

Compass Investor Relations

Semiconductor

eketchmere@compass-ir.com

investor.relations@actions-semi.com

+1-310-528-3031

+86-756-3392353*1018

ACTIONS SEMICONDUCTOR CO., LTD.

CONSOLIDATED CONDENSED BALANCE SHEETS

(in thousands of U.S. dollars)

At September 30,

At June 30,

At December 31,

2014

2014

2013

(unaudited)

(unaudited)

(audited)

ASSETS

Current assets:

Cash and cash equivalents

78,520

60,888

53,263

Time deposit

161

327

327

Restricted deposits

38,985

32,463

27,181

Marketable securities

43,520

79,664

126,607

Trading securities

74

74

74

Accounts receivable, net of allowance for doubtful accounts of $379, $185 and $nil
as of September 30,2014, June 30, 2014 and December 31, 2013 respectively

4,520

5,196

5,782

Amount due from a related party

1,032

737

1,301

Amount due from an equity method investee

46

43

38

Inventories, net of inventory written-down of $3,747, $2,845 and $1,558 as of
September 30, 2014, June 30, 2014 and December 31, 2013 respectively

22,806

27,216

20,278

Prepaid expenses and other current assets

3,563

3,831

3,972

Income tax recoverable

154

85

67

Dividend receivable

425

Deferred tax assets

848

809

416

Total current assets

194,229

211,758

239,306

Investments in equity method investees

27,061

26,992

17,843

Other investments

15,639

15,625

15,648

Marketable securities

16,067

17,139

Rental deposits

55

61

61

Property, plant and equipment, net

31,183

30,886

31,896

Land use right

1,545

1,530

1,588

Acquired intangible assets, net

17,684

19,115

12,218

Deposit paid for acquisition of intangible assets

430

489

145

Deferred tax assets

85

89

99

TOTAL ASSETS

287,911

322,612

335,943

LIABILITIES AND EQUITY

Current liabilities:

Accounts payable

5,170

7,267

6,016

Accrued expenses and other current liabilities

9,680

9,521

6,127

Short-term bank loans

33,500

34,500

35,500

Other liabilities

1,728

1,698

1,362

Income tax payable

49

49

49

Deferred tax liabilities

108

339

343

Total current liabilities

50,235

53,374

49,397

Other liabilities

229

412

Deferred tax liabilities

958

988

3,589

Total liabilities

51,422

54,362

53,398

Equity:

Ordinary shares

1

1

1

Additional paid-in capital

63,017

63,012

63,001

Treasury Stock

(70,170)

(45,055)

(44,119)

Accumulated other comprehensive income

38,919

36,327

40,734

Retained earnings

204,754

213,997

222,959

Total Actions Semiconductor Co., Ltd. shareholders’ equity

236,521

268,282

282,576

Non-controlling interest

(32)

(32)

(31)

Total equity

236,489

268,250

282,545

TOTAL LIABILITIES AND EQUITY

287,911

322,612

335,943

ACTIONS SEMICONDUCTOR CO., LTD.

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS

(in thousands of U.S. dollars, except per share amounts)

Three months ended

Three months ended

Nine months ended

Nine months ended

September 30,

September 30,

September 30,

September 30,

2014

2013

2014

2013

(unaudited)

(unaudited)

(unaudited)

(unaudited)

Revenues:

System-on-a-chip products

13,084

16,830

36,317

51,710

Semiconductor product testing services

27

54

81

106

Total revenues

13,111

16,884

36,398

51,816

Cost of revenues:

System-on-a-chip products

(11,188)

(11,248)

(29,633)

(34,246)

Semiconductor product testing services

(11)

(27)

(38)

(45)

Total cost of revenues

(11,199)

(11,275)

(29,671)

(34,291)

Gross profit

1,912

5,609

6,727

17,525

Other operating income

30

501

659

653

Operating expenses:

Research and development

(10,667)

(6,547)

(24,057)

(19,909)

General and administrative

(3,130)

(2,133)

(7,954)

(6,217)

Selling and marketing

(556)

(447)

(1,574)

(1,443)

Total operating expenses

(14,353)

(9,127)

(33,585)

(27,569)

Loss from operations

(12,411)

(3,017)

(26,199)

(9,391)

Other income (expenses)

846

187

(1,651)

1,557

Dividend income from an other investment

423

493

Interest income

2,029

2,926

7,912

9,117

Interest expense

(87)

(128)

(383)

(352)

(Loss) income before income taxes, equity in net income (loss) of
equity method investees and non-controlling interest

(9,623)

(32)

(19,898)

1,424

Income tax credit (expense)

353

(197)

1,459

(295)

Equity in net income (loss) of equity method investees

27

77

234

(182)

Net (loss) income

(9,243)

(152)

(18,205)

947

Add: Net loss attributable to non-controlling interest

1

Net (loss) income attributable to Actions Semiconductor Co., Ltd.

(9,243)

(152)

(18,205)

948

Net (loss) income attributable to Actions Semiconductor Co., Ltd.

Basic (per share)

(0.023)

(0.000)

(0.044)

0.002

Diluted (per share)

(0.023)

(0.000)

(0.044)

0.002

Basic (per ADS)

(0.137)

(0.002)

(0.267)

0.014

Diluted (per ADS)

(0.137)

(0.002)

(0.267)

0.013

Weighted-average shares used in computation:

Basic

403,462,431

413,849,403

409,491,710

412,083,249

Diluted

403,462,431

413,849,403

409,491,710

425,687,178

Weighted-average ADS used in computation :

Basic

67,243,739

68,974,901

68,248,618

68,680,542

Diluted

67,243,739

68,974,901

68,248,618

70,947,863

Note: Share-based compensation recorded in each

expense classification above is as follows:

Research and development

3

68

10

273

General and administrative

1

22

5

54

Selling and marketing

3

14

Cost of revenues

49

ACTIONS SEMICONDUCTOR CO., LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands of U.S. dollars)

Three months ended

Nine months ended

Nine months ended

September 30,

September 30,

September 30,

2014

2014

2013

(unaudited)

(unaudited)

(unaudited)

Operating activities:

Net (loss) income

(9,243)

(18,205)

947

Adjustments to reconcile net (loss) income to net cash provided by

Operating activities:

Depreciation of property, plant and equipment

457

1,462

1,564

Allowance for doubtful accounts receivable

194

379

Amortization of land use right

9

27

27

Amortization and impairment of acquired intangible assets

1,777

4,138

2,557

Utilization of subsidy from local authorities of Zhuhai,
the People’s Republic of China (“PRC”)

(222)

Write down of inventories

902

2,189

583

Gain on disposal of property, plant and equipment

(3)

Loss on disposal of intangible assets

415

Share of net (gain) loss of equity method investees

(27)

(234)

182

Share-based compensation

5

16

390

Deferred taxes

(288)

(3,277)

185

Dividend income from another investment

(423)

(493)

Changes in operating assets and liabilities:

Accounts receivable

510

862

(1,330)

Amount due from a related party

(295)

269

340

Inventories

3,852

(4,858)

(13,748)

Amount due from an equity method investee

(3)

(8)

4

Prepaid expenses and other current assets

325

369

6,852

Accounts payable

(2,158)

(815)

(1,868)

Accrued expenses and other current liabilities

30

(1,350)

(3,399)

Income tax recoverable

(68)

(88)

110

Income tax payable

1

Rental deposit received (paid)

7

5

(16)

Note Receivables

(37)

Dividend received

425

425

Net cash used in operating activities

(3,589)

(18,705)

(7,371)

Investing activities:

Investment in an equity method investee

(9,016)

(3,712)

Proceeds from redemption of marketable securities

57,955

153,277

99,532

Purchase of marketable securities

(4,990)

(53,384)

(82,800)

Proceeds from disposal of property, plant and equipment

1

20

16

Purchase of property, plant and equipment

(307)

(1,090)

(522)

Purchase of intangible assets

(159)

(5,438)

(2,685)

Increase in restricted deposits

(6,165)

(11,885)

(11,199)

Decrease in time deposits

162

162

Deposit paid for acquisition of intangible assets

(349)

(759)

Proceeds from disposal of intangible assets

24

Net cash provided by (used in) investing activities

46,497

72,321

(2,129)

Financing activities:

Advance subsidy from local authorities of Zhuhai, the PRC

232

232

302

Proceeds from exercise of share option and restricted stock unit

757

2,410

2,570

Repurchase of ordinary shares

(25,872)

(28,461)

(3,008)

Raise of short-term bank loans

10,000

5,000

Repayment of short-term bank loans

(1,000)

(12,000)

Net cash (used in) provided by financing activities

(25,883)

(27,819)

4,864

Net increase (decrease) in cash and cash equivalents

17,025

25,797

(4,636)

Cash and cash equivalents at the beginning of the period

60,888

53,263

71,336

Effect of exchange rate changes on cash

607

(540)

1,184

Cash and cash equivalents at the end of the period

78,520

78,520

67,884