Universal Display Corporation, enabling energy-efficient displays and lighting with its UniversalPHOLED  technology and materials, today announced its results for the fourth quarter and year ended December 31, 2013.

For the full year 2013, the Company reported revenues of $146.6 million, up 76% compared to revenues of $83.2 million for 2012. Operating income rose to $38.2 million for the year, up 180% from $13.7 million in 2012. The Company reported net income of $74.1 million, or $1.59 per diluted share, for the full year 2013, compared to net income of $9.7 million, or $0.21 per diluted share, for 2012. The 2013 net income included a total deferred income tax benefit of $41.4 million, which included $59.4 million for the release of income tax valuation allowances offset by the recording of a deferred income tax provision of $17.9 million subsequent to the release. Excluding those items, adjusted net income was $32.6 million, or $0.70 per adjusted diluted share.

“Universal Display delivered another strong quarter of profitability and ended 2013 with superior year-over-year growth, translating into record revenues and earnings,” said Sidney D. Rosenblatt, Executive Vice President and Chief Financial Officer of Universal Display. “Across the Company, we have been building momentum for profitable growth. A significant milestone was reached in 2013 with the commercial adoption of our green emissive dopants and green hosts. We continue to expand our IP and materials portfolio, while also pursuing new avenues of opportunity including single layer barrier encapsulation and organic vapor jet printing (OVJP) technologies. These long-term projects are in their early stages, but we believe they hold promise. We are also optimistic about the prospects for growing our business and enabling energy efficient OLED products as we continue to improve our materials, broaden our product portfolio, deepen our customer relationships, and foster developmental activity. Looking ahead to 2014, these factors and the growing OLED market give us confidence in our upward trajectory as we build shareholder value.”

Fourth Quarter Results

Revenues for the fourth quarter of 2013 were $49.5 million compared to revenues of $28.1 million in the same quarter of 2012. Growth in fourth quarter revenues was led by a 153% increase in material sales, which rose to $25.5 million, up from $10.1 million in the fourth quarter of 2012, reflecting strong volume growth in green emitter and host material sales. Royalty and license fees were $23.1 million in the fourth quarter of 2013 compared to $15.4 million in the same quarter of 2012. The Company recognized $20 million in SDC licensing revenue in the fourth quarter of 2013, up from $15 million in the same quarter of 2012.

Operating expenses for the fourth quarter of 2013 were $30.1 million compared to $19.8 million in the same quarter of 2012. Cost of materials for the fourth quarter of 2013 were $7.7 million compared to $0.7 million in the fourth quarter of 2012, reflecting an increase in the quantity of material shipped and changes in product mix.

The Company reported operating income of $19.4 million for the fourth quarter of 2013, compared to $8.4 million for the fourth quarter of 2012. Net income for the fourth quarter of 2013 was $57.9 million, or $1.24 per diluted share, compared to $5.4 million, or $0.12 per diluted share, for the fourth quarter of 2012. Net income for the fourth quarter of 2013 included a total deferred income tax benefit of $41.4 million, which included $59.4 million for the release of income tax valuation allowances offset by the recording of a deferred income tax provision of $17.9 million subsequent to the release. Excluding the net effect of those items, adjusted net income for the fourth quarter of 2013 was $16.5 million, or $0.35 per adjusted diluted share.

Full Year 2013 Results

For the full year 2013, the Company reported revenues of $146.6 million, a 76% increase from the $83.2 million generated in 2012. Material sales for 2013 were $95.7 million, a 115% increase from $44.5 million in 2012. Operating income was $38.2 million compared to $13.7 million in 2012. The Company reported net income of $74.1 million, or $1.59 per diluted share for the full year of 2013, compared to $9.7 million, or $0.21 per diluted share for 2012. Net income for the year 2013 included the aforementioned net income tax items of $41.4 million. Excluding these items, adjusted net income was $32.6 million, or $0.70 per adjusted diluted share.

The Company’s balance sheet remained strong, with cash and cash equivalents and short-term investments of $272.6 million as of December 31, 2013. For the full year 2013, the Company generated $45.0 million in operating cash flow, compared to $17.8 million of operating cash flow in 2012.

2014 Guidance

Although the OLED industry is still at an early stage where many variables can have a material impact on its growth, and the Company thus caveats its financial guidance accordingly, the Company believes that its revenues will be in the range of $190 million to $205 million for fiscal 2014.