SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported): August 4, 2011

UNIVERSAL ELECTRONICS INC.

(Exact name of Registrant as specified in its charter)

Delaware		0-21044		33-0204817
(State or other jurisdiction of incorporation or organization)		(Commission File No.)		(I.R.S. Employer Identification No.)

6101 Gateway Drive
Cypress, California 90630
(Address of principal executive offices, with Zip Code)

(714) 820-1000
(Registrant’s telephone number, including area code):

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o		Written communications pursuant to Rule 425 under the Securities Act

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

 

 

TABLE OF CONTENTS

Item 2.02 Results of Operations and Financial Condition		1
Item 9.01 Financial Statements and Exhibits		1
SIGNATURES		2
INDEX TO EXHIBITS		3
EXHIBIT 99.1

Item 2.02		Results of Operations and Financial Condition

On August 4, 2011, Universal Electronics Inc. (“UEI”) is issuing a press release and holding a conference call regarding its financial results for the second quarter 2011. A copy of the press release is furnished as Exhibit 99.1 to this report.

Pursuant to General Instruction B2 of Form 8-K, the information contained in Exhibit 99.1 will be deemed furnished, and not “filed,” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, as amended, except as expressly set forth by specific reference in any such filing, or subject to the liabilities of that Section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.

In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, UEI provides non-GAAP or Adjusted Pro Forma information in the press release as additional information for its operating results. References to Adjusted Pro Forma information are to non-GAAP pro forma measures. These measures are not in accordance with, or an alternative for, GAAP and may be different from non-GAAP measures used by other companies. UEI’s management believes that this presentation of Adjusted Pro Forma financial information provides useful information to management and investors regarding certain additional financial and business trends relating to its financial condition and results of operations. In addition, management uses these measures for reviewing the financial results of UEI and for budget planning purposes.

Item 9.01		Financial Statements and Exhibits

(c) Exhibits. The following exhibit is furnished with this report.

	99.1			Press Release of Universal Electronics Inc. dated August 4, 2011.

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 thereunto duly authorized.

INDEX TO EXHIBITS

Exhibit Number				Description
	99.1			Press Release dated August 4, 2011

Exhibit 99.1

Contacts: Paul Arling (UEI) 714.820.1000
Becky Herrick (IR Agency) 415.433.3777

Universal Electronics Reports Second Quarter 2011 Financial Results

CYPRESS, CA — August 4, 2011 — Universal Electronics Inc. (UEI), (NASDAQ: UEIC) reported financial results for the three and six months ended June 30, 2011.

Paul Arling, UEI’s Chairman and CEO, stated: “During the second quarter of 2011, UEI posted strong revenue of $121.7 million and delivered 35% growth in adjusted pro forma EPS compared to the same period last year. These results reflect our ability to gain share in a challenging market. However, forecasts have indicated a difficult environment is expected for the remainder of the year. We anticipate this will have an impact on consumer electronics spending, which affects both our Business and Consumer Categories.”

“Our leadership position in the global marketplace, our broad range of products and technologies that address multiple markets, and our solid financial foundation has served us well over our history. Even in the face of this turbulent economy, we expect to become stronger than ever. We will continue to invest in innovation to ensure we grow along with the many changing options and features in home entertainment devices and content, as well as invest in regions with promising market growth. There are significant market opportunities available to us, and today we are better positioned than ever to capitalize on them.”

Financial Results for the Three Months Ended June 30: 2011 Compared to 2010

•

Net sales were $121.7 million, compared to $78.9 million.

	•		Business Category revenue was $111.1 million, compared to $67.3 million. The Business Category contributed 91% of total net sales, compared to 85%.
	•		Consumer Category revenue was $10.6 million, compared to $11.6 million. The Consumer Category contributed 9% of total net sales, compared to 15%.

•		Adjusted pro forma gross margins were 28.9%, compared to gross margins of 34.8%.
•		Adjusted pro forma operating expenses were $25.6 million, compared to operating expenses of $20.1 million.
•		Adjusted pro forma operating income was $9.6 million, compared to operating income of $7.3 million.
•		Adjusted pro forma net income was $7.1 million, or $0.46 per diluted share, compared to net income of $4.8 million, or $0.34 per diluted share.
•		At June 30, 2011, cash and cash equivalents was $37.9 million.

Financial Results for the Six Months Ended June 30: 2011 Compared to 2010

•		Net sales were $227.5 million, compared to $150.3 million.
•		Adjusted pro forma gross margins were 27.7%, compared to gross margins of 32.9%.
•		Adjusted pro forma operating expenses were $50.0 million, compared to operating expenses of $39.5 million.
•		Adjusted pro forma net income was $9.7 million, or $0.63 per diluted share, compared to net income of $6.6 million, or $0.47 per diluted share.

Financial Outlook

For the third quarter of 2011, the company expects net sales to range between $121 million and $127 million, compared to $79.0 million in the third quarter of 2010. Adjusted pro forma earnings per diluted share for the third quarter of 2011 are expected to range from $0.47 to $0.57, compared to earnings per diluted share of $0.34 in the third quarter of 2010.

For the full 2011 year, the company expects net sales to range between $470 million and $490 million, compared to $331.8 million in 2010. Adjusted pro forma earnings per diluted share for 2011 are expected to range from $1.75 to $1.95, compared to adjusted pro forma earnings per diluted share of $1.27 in 2010.

Conference Call Information

UEI’s management team will hold a conference call today, Thursday, August 4, 2011 at 4:30 p.m. ET / 1:30 p.m. PT, to discuss its second quarter 2011 earnings results, review the quarterly activity and answer questions. To access the call in the U.S. please dial 877-655-6895 and for international calls dial 706-758-0299 approximately 10 minutes prior to the start of the conference. The conference ID is 83606169. The conference call will also be broadcast live over the Internet and available for replay for one year at www.uei.com. In addition, a replay of the call will be available via telephone for two business days, beginning two hours after the call. To listen to the replay, in the U.S., please dial 855-859-2056 and internationally, 404-537-3406. Enter access code 83606169.

Use of Non-GAAP Financial Metrics

Non-GAAP gross margins, Non-GAAP operating expenses, and Non-GAAP net income and earnings per share are supplemental measures of the company’s performance that are not required by, and are not presented in accordance with GAAP. The non-GAAP information does not substitute for any performance measure derived in accordance with GAAP. Non-GAAP gross profit is defined as gross profit excluding charges related to the write-up of inventory and depreciation related to the acquisition. Non-GAAP operating expenses is defined as cash operating expenses excluding acquisition costs, amortization of intangibles and other employee related restructuring costs. Non-GAAP net income is net income from operations excluding the aforementioned items. A reconciliation of Non-GAAP financial results to GAAP results is included at the end of this press release.

About Universal Electronics Inc.

Founded in 1986, Universal Electronics Inc. (UEI) is the global leader in wireless control technology for the connected home. UEI designs, develops, and delivers innovative solutions that enable consumers to control entertainment devices, digital media, and home systems. The company’s broad portfolio of patented technologies and database of infrared control software have been adopted by many Fortune 500 companies in the consumer electronics, subscription broadcast, and computing industries. UEI sells and licenses wireless control products through distributors and retailers under the One For All^® brand name. For additional information, please visit our website at www.uei.com.

Safe Harbor Statement

This press release contains forward-looking statements that are made pursuant to the Safe-Harbor provisions of the Private Securities Litigation Reform Act of 1995. Words and expressions reflecting something other than historical fact are intended to identify forward-looking statements. These forward-looking statements involve a number of risks and uncertainties, including the benefits anticipated by the Company due to continued innovation of products and technologies; new markets growth; the Company’s ability to gain market share; general economic conditions; and other factors described in the Company’s filings with the U.S. Securities and Exchange Commission. The actual results that the Company achieves may differ materially from any forward looking statement due to such risks and uncertainties. The Company undertakes no obligations to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.

— Tables Follow —

UNIVERSAL ELECTRONICS INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share-related data)
(Unaudited)

		June 30,				December 31,
		2011				2010
ASSETS
Current assets:
Cash and cash equivalents		$	37,900			$	54,249
Accounts receivable, net			87,733				86,304
Inventories, net			76,497				65,402
Prepaid expenses and other current assets			2,855				2,582
Deferred income taxes			6,195				5,896
Total current assets			211,180				214,433
Property, plant, and equipment, net			78,395				78,097
Goodwill			31,033				30,877
Intangible assets, net			34,358				35,994
Other assets			5,365				5,464
Deferred income taxes			7,479				7,806
Total assets		$	367,810			$	372,671
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	59,705			$	56,086
Notes payable			20,600				35,000
Accrued sales discounts, rebates and royalties.			6,135				7,942
Accrued income taxes			2,283				5,873
Accrued compensation			29,681				30,634
Deferred income taxes			49				—
Other accrued expenses			12,682				13,295
Total current liabilities			131,135				148,830
Long-term liabilities:
Deferred income taxes			11,547				11,369
Income tax payable			1,212				1,212
Other long-term liabilities			5				56
Total liabilities			143,899				161,467
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value, 5,000,000 shares authorized; none issued or outstanding			—				—
Common stock, $0.01 par value, 50,000,000 shares authorized; 21,029,169 and 20,877,248 shares issued on June 30, 2011 and December 31, 2010, respectively			210				209
Paid-in capital			170,788				166,940
Accumulated other comprehensive income (loss)			3,704				(489	)
Retained earnings			142,018				134,070
			316,720				300,730
Less cost of common stock in treasury, 6,048,261 and 5,926,071 shares on June 30, 2011 and December 31, 2010, respectively			(92,809	)			(89,526	)
Total stockholders’ equity			223,911				211,204
Total liabilities and stockholders’ equity		$	367,810			$	372,671

UNIVERSAL ELECTRONICS INC.
CONSOLIDATED INCOME STATEMENTS
(In thousands, except per share amounts)
(Unaudited)

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2011				2010				2011				2010
Net sales		$	121,746			$	78,892			$	227,458			$	150,268
Cost of sales			86,802				51,467				164,935				100,779
Gross profit			34,944				27,425				62,523				49,489
Research and development expenses			3,157				2,488				6,414				5,257
Selling, general and administrative expenses			23,477				17,621				45,264				34,229
Operating income			8,310				7,316				10,845				10,003
Interest (expense) income, net			(69	)			17				(154	)			100
Other (expense) income, net			(384	)			(21	)			(418	)			22
Income before provision for income taxes			7,857				7,312				10,273				10,125
Provision for income taxes			(1,736	)			(2,535	)			(2,325	)			(3,512	)
Net income		$	6,121			$	4,777			$	7,948			$	6,613
Earnings per share:
Basic		$	0.41			$	0.35			$	0.53			$	0.48
Diluted		$	0.40			$	0.34			$	0.52			$	0.47
Shares used in computing earnings per share:
Basic			15,025				13,601				15,000				13,650
Diluted			15,407				13,929				15,395				14,011

UNIVERSAL ELECTRONICS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

		Six months Ended
		June 30,
		2011				2010
Cash provided by operating activities:
Net income		$	7,948			$	6,613
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			8,588				3,079
Provision for doubtful accounts			237				747
Provision for inventory write-downs			2,099				1,450
Deferred income taxes			645				33
Tax benefit from exercise of stock options and vested restricted stock			374				109
Excess tax benefit from stock-based compensation			(344	)			(103	)
Shares issued for employee benefit plan			396				375
Stock-based compensation			2,085				2,532
Changes in operating assets and liabilities:
Accounts receivable			262				3,872
Inventories			(11,409	)			(6,368	)
Prepaid expenses and other assets			(78	)			307
Accounts payable and accrued expenses			(2,514	)			2,992
Accrued income taxes			(3,696	)			(1,909	)
Net cash provided by operating activities			4,593				13,729
Cash (used for) provided by investing activities:
Term deposit			—				49,246
Acquisition of property, plant, and equipment			(5,554	)			(3,041	)
Acquisition of intangible assets			(513	)			(749	)
Net cash (used for) provided by investing activities			(6,067	)			45,456
Cash used for financing activities:
Payment of debt			(14,400	)			—
Proceeds from stock options exercised			1,212				257
Treasury stock purchased			(3,500	)			(7,308	)
Excess tax benefit from stock-based compensation			344				103
Net cash used for financing activities			(16,344	)			(6,948	)
Effect of exchange rate changes on cash			1,469				(2,415	)
Net (decrease) increase in cash and cash equivalents			(16,349	)			49,822
Cash and cash equivalents at beginning of period			54,249				29,016
Cash and cash equivalents at end of period		$	37,900			$	78,838

Supplemental Cash Flow Information — We had net income tax payments of $6.4 million and $5.6 million during the six months ended June 30, 2011 and 2010, respectively. We had interest payments of $0.2 million and $0 during the six months ended June 30, 2011 and 2010, respectively.

UNIVERSAL ELECTRONICS INC.
RECONCILIATION OF ADJUSTED PRO FORMA FINANCIAL RESULTS
(In thousands)
(Unaudited)

		Three Months Ended												Three Months Ended
		June 30, 2011												June 30, 2010
										Adjusted												Adjusted
		GAAP				Adjustments				Pro Forma				GAAP				Adjustments				Pro Forma
Net sales		$	121,746			$	—			$	121,746			$	78,892			$	—			$	78,892
Cost of sales (1)			86,802				(277	)			86,525				51,467				—				51,467
Gross profit			34,944				277				35,221				27,425				—				27,425
Research and development expenses			3,157				—				3,157				2,488				—				2,488
Selling, general and administrative expenses (2)			23,477				(1,026	)			22,451				17,621				—				17,621
Operating income			8,310				1,303				9,613				7,316				—				7,316
Interest (expense) income, net			(69	)			—				(69	)			17				—				17
Other (expense) income, net			(384	)			—				(384	)			(21	)			—				(21	)
Income before provision for income taxes			7,857				1,303				9,160				7,312				—				7,312
Provision for income taxes (3)			1,736				296				2,032				2,535				—				2,535
Net income		$	6,121			$	1,007			$	7,128			$	4,777			$	—			$	4,777
Earnings per share diluted		$	0.40			$	0.06			$	0.46			$	0.34			$	—			$	0.34

		Six Months Ended												Six Months Ended
		June 30, 2011												June 30, 2010
										Adjusted												Adjusted
		GAAP				Adjustments				Pro Forma				GAAP				Adjustments				Pro Forma
Net sales		$	227,458			$	—			$	227,458			$	150,268			$	—			$	150,268
Cost of sales (1)			164,935				(554	)			164,381				100,779				—				100,779
Gross profit			62,523				554				63,077				49,489				—				49,489
Research and development expenses			6,414				—				6,414				5,257				—				5,257
Selling, general and administrative expenses (2)			45,264				(1,659	)			43,605				34,229				—				34,229
Operating income			10,845				2,213				13,058				10,003				—				10,003
Interest (expense) income, net			(154	)			—				(154	)			100				—				100
Other (expense) income, net			(418	)			—				(418	)			22				—				22
Income before provision for income taxes			10,273				2,213				12,486				10,125				—				10,125
Provision for income taxes (3)			2,325				441				2,766				3,512				—				3,512
Net income		$	7,948			$	1,772			$	9,720			$	6,613			$	—			$	6,613
Earnings per share diluted		$	0.52			$	0.11			$	0.63			$	0.47			$	—			$	0.47