UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington,
DC 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
OF THE SECURITIES EXCHANGE ACT OF 1934
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GENESIS MICROCHIP INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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To Our Stockholders,
Fiscal 2006 marked a year of strong revenue and earnings growth
for Genesis, as the flat-panel TV and LCD monitor markets
continued their expansion, with Genesis continuing to enjoy
solid market share. This past year, Genesis invested significant
resources in the development of our Digital TV controller
solutions in order to meet customer demand for highly integrated
products with unparalleled video quality. This investment in our
future technology portfolio complements the integrated advanced
TV solutions that we currently offer to the world’s largest
consumer electronics manufacturers.
Revenues increased a strong 32 percent from fiscal 2005 to
$269.5 million. More significantly, the company’s
flat-panel TV revenues increased 81 percent. In our monitor
business, revenues increased 7 percent, despite the
continued price pressure in that area of our business. We
shipped a total of 62.6 million controllers, an increase of
37 percent in unit shipments over our fiscal year 2005, and
a new record for Genesis. The continued shift in our mix of
revenue towards our TV products, along with a diligent effort
towards managing product costs drove a gross margin increase
from 38.6 percent to 43.2 percent in 2006. We actively
managed our spending, and as a result, operating expenses
decreased as a percentage of revenue. We returned to
profitability, delivering net income of $18.4 million
dollars in fiscal 2006 as compared to a net loss of
$9.4 million in fiscal 2005. We closed the year with a
strong balance sheet, with $185.4 million in cash and
short-term investments and no debt.
We extended our leadership in the display industry by continuing
our focus on innovation and integration. A vital part of our
strategy is the development of new products that deliver the
industry’s best display quality, while at the same time
offering advanced integration to increase performance,
functionality, and to reduce our customers’ product costs.
To that end, we introduced several new products during the year.
PurVIEW
HDtm
marked the Company’s entry into the HD Digital TV market.
The Company introduced Cortez Advanced and Cortez Plus, new
additions to our widely adopted Cortez family, featuring true
10-bit performance, the
next generation of
Faroudja®
video processing and support for 1080p displays. We also
launched the Oak family of controllers which offers
DCDi®
by Faroudja video processing and our unique
ACM-3Dtm
color management technologies for multi-function LCD monitors
(MFMs) and LCD TVs. Additionally we introduced the gm5766, a
low-cost, memoryless controller in the Phoenix family that
features true six axis color controls to address the mainstream
and performance LCD monitor markets. And finally, with the
introduction of the gm7746, a high resolution LCD panel timing
controller for 8 and
10-bit, true HD
resolution TV panels and WUXGA monitor panels, the Company
widened its portfolio of addressable markets.
| While a strong product portfolio gives Genesis a distinct competitive advantage, we know that the bottom line is driven by how well we take care of our customers. Our technical staff members are regular fixtures at our customers’ facilities, and truly share in the responsibility of launching their newest products into production. I am very proud to announce that one of these customers, Philips Electronics, bestowed Genesis with the Supplier of the Year award in recognition of our outstanding support. Our customers cite our in-country support and design expertise as key factors in their decision to use Genesis as their primary display controller supplier. | |
| Building on our strong relationships with five of the world’s largest LCD TV manufacturers and our 2006 design-cycle momentum, I believe that Genesis is well-positioned for continued growth in the highly competitive flat-panel TV and LCD monitor markets. I firmly believe our broad portfolio of display controller solutions, combined with our solid top-tier customer relationships and our improved financial performance, position Genesis to remain the leader in our key markets. |
 Elias Antoun President and CEO |
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