Brad Miller - Director, IR Dirk Chen - CFO

Ladies and gentlemen, thank you for standing by, and welcome to the Q4 2013 GigaMedia Limited Earnings Conference Call. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. (Operator Instructions) I must advise you that this conference is being recorded today, Friday, 11th of April, 2014. I would now like to hand the call over to Mr. Brad Miller. Thank you, sir. Please go ahead.

Thank you. This is Brad Miller, Investor Relations Director of GigaMedia. Welcome to our conference call to discuss GigaMedia’s fourth quarter and full year 2013 financial results. With me today is Dirk Chen, our CFO. Now unfortunately, our CEO, Collin Hwang has caught a springtime [bug throwing] (ph) something and unfortunately he won't be able to join the call today, but he will be with us next month when we do our 1Q results. Before we begin, I would like to remind you that a number of forward-looking statements will be made during this conference call. Forward-looking statements are any statements that are not historical facts. These forward-looking statements are based on the current expectations of GigaMedia and there can be no assurance that such expectations will prove to be correct. Because forward-looking statements involve risks and uncertainties, GigaMedia’s actual results could differ materially from these statements. Information about factors that could cause, and in some cases have caused, such differences can be found in GigaMedia’s Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission in April 2013. This presentation is being made on April 11, 2014, in Taiwan. The content of this presentation contains time-sensitive information that is accurate only as of the time hereof. If any portion of this presentation is rebroadcast, retransmitted or redistributed at a later date, GigaMedia will not be reviewing or updating the material that is contained therein. After today’s prepared remarks, we will again go into Q&A session where we'll respond to questions that we’ve taken by email and also take live questions today. With that, let me read the prepared remarks that Collin normally reads. Today, I'll provide first an update on what we are doing to grow GigaMedia and then I'll turn to look at some financial…

Thank you. We will now begin the question-and-answer session. (Operator Instructions)

Operator, while we’re waiting for any potential questions, we have received some questions by email. So let me start with that. An investor has asked, it’s a following question. Can you estimate how much R&D spending will increase going forward to support growth plans that you have? So let me turn this over to Dirk for his comments.

Okay. Thanks Brad. Hi, everyone. For [again] (ph) I think our company right now is focused on browser and mobile game rather than PC games. And do not foresee but to develop mobile games across different end to develop the PC game. And in 2014, we estimate that R&D cost is about $2 million to $2.5 million, which is going up about 5% from 2013.

Okay. Thanks Dirk.

(Operator Instructions)

Okay, operator we another question received by email here. Could you give us some more color on your new hire, Dane Wu, our new Chief Strategy Officer? What does he find so appealing about GigaMedia? So again I’ll let our CFO, Dirk to have a few comments on this?

Okay. Thank. I think incumbency, we have released today Mr. Wu joined us. Mr. Wu has so many years in game industry. And we hired him to help us solving games and also develop our web connection with game [online] (ph). I think these two things so far for GigaMedia and business is so important. So I believe Mr. Wu join us, that will give us more momentum to develop our game business where in line with our game developing strategy going forward.

Okay. Thanks, Dirk. Just to reiterate, I think he has a lot of connections which will prove to be very helpful for us in developing relationships with other companies and game sourcing. And what he finds appealing about GigaMedia, I think GigaMedia games business is very much a clean sweep at this point. We have a lot of resources. We have a plan -- a growth plan in place that I think he find appealing. And we have very talented team. As I said before, I think we have more talent in our games business than at any point in the past. Operator, any additional questions?

We do have a question from the line of [Tim] (ph). Please go ahead.

Yes, one quick question with the cash balance seen above the current share price than the share price being well below the book value, would it make sense at this point to do a buyback until we at least get the equilibrium there?

Thanks very much for your question. I think in terms of buyback, it's something that we had looked at in the past and we’ve considered this in the past. We continue to look at it. But I think at the moment our priority is to use cash to grow our business. In the past, we've looked at a number of opportunities to use our cash and strategic transactions to grow the company and we may continue to do that. But if we reach a point where we are certain that our cash gives us more than enough flexibility to execute our growth plans then I think we’ll give more priority to a buyback. I think we are just not at that point right now. But it’s certainly something that we keep in mind and that we do hear this from time to time from investors. So thanks very much for that.

Okay. Thank you. It sounds like a plan.

(Operator Instructions)

Okay. Operator, a final question that we have by email. What trends do you see in gaming that give you confidence in your strategy? I think our strategy -- our growth strategy, social casino games and mobile/browser games is really developed based on the trends in the gaming market right now. As you know and as we've pointed out in the past, the PC games business is in the time the whole market is in decline. So we are very focused on social casino games and browser/mobile games. Browser/mobile games, is how people prefer to play games right now. Most games the casual games of course, there are some games that would require higher computing power and you really want to sit on the PC to play a big MMO. But by and large, the casual games, people like to play them on mobile devices. So we are very focused on that. We are off to a good start in that. And in the social casino games, we like that factor because these games tend to be very steady and they have very high ARPU compared to other types of games. So we are looking forward to launching our social casino games platforms and we’ll have a lot more details to share on that as we go forward. Operator, any additional questions?

There are no additional questions as of and now sir.

Okay, Operator, I think that’s all we have for today. Thank you very much everyone. For further information about GigaMedia, or if you have questions and would like to contact the company, please visit our website at gigamedia.com. That concludes today’s call. Thank you all very much for joining us.

Ladies and gentlemen, that does conclude our conference for today. Thank you for participating. You may all disconnect.