ChipMOS REPORTS SECOND QUARTER 2018 RESULTS
Q2'18 Highlights (as compared to Q1'18):
-- Net Revenue Grows 12% to US$147.6 Million Compared to US$131.8 Million
-- Gross Profit Improves to US$24.2 Million Compared to US$19.2 Million
-- Gross Margin Increases to 16.4% Compared to 14.6%
-- Cash Dividend of NT$0.30 Per Common Share or Approximately US$0.20 Per
ADS Approved by Shareholders
-- Capital Reduction Plan Approved by Shareholders and Taiwan's Competent
Authority; NT$1.50 Per Common Share Will Be Returned to Shareholders or
Approximately US$0.99 Per ADS, With a 15% Reduction of the Total
Outstanding Common Shares and ADSs
HSINCHU, Taiwan, Aug. 9, 2018 /PRNewswire-FirstCall/ -- ChipMOS TECHNOLOGIES INC. ("ChipMOS" or the "Company") (Taiwan Stock Exchange: 8150 and NASDAQ: IMOS), an industry leading provider of outsourced semiconductor assembly and test services ("OSAT"), today reported unaudited consolidated financial results for the second quarter ended June 30, 2018. All U.S. dollar figures cited in this press release are based on the exchange rate of NT$30.43 against US$1.00 as of June 29, 2018.
All the figures were prepared in accordance with Taiwan-International Financial Reporting Standards ("Taiwan-IFRS").
Net revenue for the second quarter of 2018 was NT$4,491.6 million or US$147.6 million, an increase of 12.0% from NT$4,010.9 million or US$131.8 million in the first quarter of 2018 and a decrease of 1.1% from NT$4,541.2 million or US$149.2 million for the same period in 2017.
Net profit attributable to equity holders of the Company for the second quarter of 2018 was NT$124.1 million or US$4.1 million, and NT$0.15 or US$0.005 per basic common share and NT$0.14 or US$0.005 per diluted common share, as compared to net profit attributable to equity holders of the Company for the first quarter of 2018 of NT$22.8 million or US$0.7 million, and NT$0.03 or US$0.001 per basic common share and NT$0.03 or US$0.001 per diluted common share, and compared to net profit attributable to equity holders of the Company in the second quarter of 2017 of NT$321.4 million or US$10.6 million, and NT$0.38 or US$0.01 per basic common share and NT$0.38 or US$0.01 per diluted common share. Net earnings for the second quarter of 2018 were US$0.10 per diluted ADS, compared to US$0.02 per diluted ADS for the first quarter of 2018 and US$0.25 per diluted ADS in the second quarter of 2017. Net profit in the second quarter of 2018 reflects the adverse impact of higher depreciation and withholding expenses.
S.J. Cheng, Chairman and President of ChipMOS, said, "This was a strong quarter for us as we delivered on our financial goals and efforts to increase shareholder value. We achieved 12% revenue growth in Q2 compared to Q1 and improved our gross margin to 16.4% from 14.6% in the prior quarter. Based on capacity constraints and market demand we raised our DDIC prices in May. DDIC demand growth is expected to continue through the second half of 2018 led by gold bumping and mixed-signal testing and assembly services related to new, narrow bezel, full screen smartphone models, among other areas. We continue to manage our capacity levels closely in support of growth areas, including 12" fine pitch chip-on-film and TDDI, where revenue grew in the double digits compared to Q1 to represent in the high single digit of our total Q2 revenue. TDDI test programs require up to 3 times the test time of regular DDIC test programs, putting our capacity at an even higher premium as customers seek to secure the needed support for their expected growth. We are also encouraged by growth in our flash assembly and test business, which is benefiting from diverse demand drivers, including IoT, smart speakers and gaming products. As a result, our flash business revenue grew more than 15% in Q2 compared to Q1, and represented nearly 23% of total Q2 revenue. Overall, we think the rest of the year can be quite positive as we benefit from our growth strategy and improved capital structure."
Silvia Su, Vice President of Finance and Accounting, commented, "We held our operating expenses in check as we carefully manage our resources and operating structure in support of the higher demand levels we are seeing. Our focus on expense controls, along with increased demand and our DDIC price increase in May, helped us improve gross margin to 16.4% in Q2. We expect to see further improvement in gross margin as we move through 2018 based on current market conditions. We ended the second quarter with a balance of cash and cash equivalents of US$134.2 million, and a net debt balance of US$141.4 million with a net debt to equity ratio of 23.3%. This is after CapEx of $32.1 million in the second quarter, the majority of which was invested in expanding our LCD driver capacity to meet customer demand levels, mainly for DDIC test and 12" fine pitch chip-on-film. Our balance sheet is allowing us to reward shareholders through the issuance of cash dividend and a capital return related to our 2018 Capital Reduction plan. The dividend and the 2018 Capital Reduction plan have been approved by shareholders and Taiwan's Competent Authority, with distributions expected in the fourth quarter of 2018."
Selected Operation Data
Q2'18 Q1'18
----- -----
Revenue by segment
Testing 27.6% 28.8%
Assembly 26.2% 26.5%
LCD Driver 28.9% 27.1%
Bumping 17.3% 17.6%
CapEx US$32.1 million US$41.5 million
Testing 38.3% 29.3%
Assembly 6.0% 8.1%
LCD Driver 46.7% 55.0%
Bumping 9.0% 7.6%
Depreciation and amortization
expenses US$27.7 million US$26.7 million
Utilization by segment
Testing 80% 79%
Assembly 64% 61%
LCD Driver 81% 78%
Bumping 70% 65%
Overall 74% 71%
Condensed consolidated
statements of cash flows Period ended Period ended
Jun. 30, 2018 Jun. 30, 2017
US$ million US$ million
----------- -----------
Net cash generated from (used
in) operating activities 48.2 101.0
Net cash generated from (used
in) investing activities (103.3) (44.5)
Net cash generated from (used
in) financing activities (75.0) 58.1
Net increase (decrease) in
cash and cash equivalents (130.1) 114.6
Effect of exchange rate
changes on cash 0.2 0.6
Cash and cash equivalents at
beginning of period 264.1 248.8
Cash and cash equivalents at
end of period 134.2 364.0
Investor Conference Call / Webcast Details
ChipMOS will host two conference calls on Thursday, August 9, 2018 to discuss the Company's financial results for the second quarter of 2018.
1. Date: Thursday, August 9, 2018
Time: 4:00PM Taiwan (4:00AM New York)
Dial-In: +886-2-21928016
Password: 659165#
Replay Starting 2 Hours After Live Call Ends:
www.chipmos.com.tw
Language: Mandarin
2. Date: Thursday, August 9, 2018
Time: 8:00PM Taiwan (8:00AM New York)
Dial-In: +1-201-689-8562
Password: 13681835
Replay Starting 2 Hours After Live Call Ends:
+1-412-317-6671, with ID 13681835
Webcast of Live Call and Replay: www.chipmos.com
Language: English
About ChipMOS TECHNOLOGIES INC.:
ChipMOS TECHNOLOGIES INC. ("ChipMOS" or the "Company") (Taiwan Stock Exchange: 8150 and NASDAQ: IMOS) (http://www.chipmos.com) is an industry leading provider of outsourced semiconductor assembly and test services. With advanced facilities in Hsinchu Science Park, Hsinchu Industrial Park and Southern Taiwan Science Park in Taiwan, ChipMOS provide assembly and test services to a broad range of customers, including leading fabless semiconductor companies, integrated device manufacturers and independent semiconductor foundries.
Forward-Looking Statements
This press release may contain certain forward-looking statements. These forward-looking statements may be identified by words such as 'believes,' 'expects,' 'anticipates,' 'projects,' 'intends,' 'should,' 'seeks,' 'estimates,' 'future' or similar expressions or by discussion of, among other things, strategy, goals, plans or intentions. These statements may include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance. Actual results may differ materially in the future from those reflected in forward-looking statements contained in this document, due to various factors. Further information regarding these risks, uncertainties and other factors are included in the Company's most recent Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission (the "SEC") and in the Company's other filings with the SEC.
About Non-Generally Accepted Accounting Principles ("Non-GAAP") Financial Measures
To supplement the consolidated financial results presented in accordance with the Taiwan-IFRS, ChipMOS uses non-GAAP free cash flow, non-GAAP earnings before interest, taxes, depreciation and amortization ("EBITDA") and non-GAAP net debt to equity ratio in this press release. The non-GAAP free cash flow represents operating profit plus depreciation, amortization and interest income and less capital expenditures, interest expense, income tax expense and dividend. The non-GAAP EBITDA represents operating profit plus depreciation and amortization. The non-GAAP net debt to equity ratio represents the ratio of net debt, the sum of debt less cash and cash equivalent, divided by equity attributable to equity holders of the Company. These non-GAAP financial measures may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently.
The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with the Taiwan-IFRS.
ChipMOS considers the use of non-GAAP free cash flow, non-GAAP EBITDA and non-GAAP net debt to equity ratio provides useful information to management to manage the Company's business and make financial and operational decisions and also to the investors to understand and evaluate the Company's business and operating performance. For more information on these non-GAAP financial measures, please refer to the table captioned "Reconciliations of Non-GAAP Measures to the Nearest Comparable GAAP Measures" in this press release.
- FINANCIAL TABLES FOLLOW BELOW -
ChipMOS TECHNOLOGIES INC.
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Three Months Ended Jun. 30, Mar. 31, 2018 and Jun. 30, 2017
Figures in Millions of U.S. dollars (USD) (1)
Except for Per Share Amounts and Weighted Average Shares Outstanding
Three months ended
------------------
Jun. 30, 2018 Mar. 31, 2018 Jun. 30, 2017
------------- ------------- -------------
USD USD USD
--- --- ---
Revenue 147.6 131.8 149.2
Cost of revenue (123.4) (112.6) (119.3)
------ ------ ------
Gross profit 24.2 19.2 29.9
---- ---- ----
Research and development expenses (8.2) (7.1) (8.0)
Sales and marketing expenses (0.5) (0.4) (0.4)
General and administrative expenses (4.0) (4.3) (7.7)
Other operating income (expenses), net 2.1 1.1 1.0
--- --- ---
Operating profit 13.6 8.5 14.8
---- --- ----
Non-operating income (expenses), net 2.1 (6.9) (1.9)
--- ---- ----
Profit (loss) before tax 15.7 1.6 12.9
Income tax benefit (expense) (11.6) (0.9) (2.3)
----- ---- ----
Profit (loss) for the period 4.1 0.7 10.6
=== === ====
Other comprehensive income (loss)
Exchange differences on translation of foreign
operations (0.9) 1.7 1.0
Unrealized gain (loss) on valuation of equity
instruments at fair value through other
comprehensive income 0.5 0.4 -
Share of other comprehensive income (loss) of
associates and joint ventures accounted for
using equity method (0.0) 0.0 -
Income tax effect (0.1) (0.1)
Total other comprehensive income (loss) (0.5) 2.0 1.0
---- --- ---
Total comprehensive income (loss) 3.6 2.7 11.6
=== === ====
Profit (loss) attributable to the Company -
basic 4.1 0.7 10.6
=== === ====
Earnings (loss) per share attributable to the
Company -basic 0.005 0.001 0.01
Earnings (loss) per ADS equivalent - basic 0.10 0.02 0.25
==== ==== ====
Weighted average shares outstanding (in
thousands) -basic 849,672 849,571 845,206
======= ======= =======
Profit (loss) attributable to the Company -
diluted 4.1 0.7 10.6
=== === ====
Earnings (loss) per share attributable to the
Company -diluted 0.005 0.001 0.01
===== ===== ====
Earnings (loss) per ADS equivalent - diluted 0.10 0.02 0.25
==== ==== ====
Weighted average shares outstanding (in
thousands) -diluted 857,028 854,443 852,649
======= ======= =======
Note:
(1) All U.S. dollar figures in this release are based on the exchange rate of NT$30.43 against US$1.00 as of Jun. 29, 2018. The convenience
translation should not be construed as representations that the NT dollar amounts have been, or could be in the future be, converted into US dollars
at this or any other exchange rate.
ChipMOS TECHNOLOGIES INC.
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Three Months Ended Jun. 30, Mar. 31, 2018 and Jun. 30, 2017
Figures in Millions of NT dollars (NTD)
Except for Per Share Amounts and Weighted Average Shares Outstanding
Three months ended
------------------
Jun. 30,
2018 Mar. 31, 2018 Jun. 30, 2017
--------- ------------- -------------
NTD NTD NTD
--- --- ---
Revenue 4,491.6 4,010.9 4,541.2
Cost of revenue (3,756.4) (3,426.8) (3,630.8)
-------- -------- --------
Gross profit 735.2 584.1 910.4
----- ----- -----
Research and development expenses (249.5) (215.8) (244.6)
Sales and marketing expenses (13.9) (11.0) (13.2)
General and administrative expenses (120.9) (132.2) (235.7)
Other operating income (expenses), net 63.2 32.4 31.7
---- ---- ----
Operating profit 414.1 257.5 448.6
----- ----- -----
Non-operating income (expenses), net 62.9 (207.8) (56.4)
---- ------ -----
Profit (loss) before tax 477.0 49.7 392.2
Income tax benefit (expense) (352.9) (26.9) (70.8)
------ ----- -----
Profit (loss) for the period 124.1 22.8 321.4
===== ==== =====
Other comprehensive income (loss)
Exchange differences on translation of (25.3) 50.9 33.1
foreign operations
Unrealized gain (loss) on valuation of 14.1 11.3 -
equity instruments at fair value through
other comprehensive income
Share of other comprehensive income (0.8) (0.9) -
(loss) of associates and joint ventures
accounted for using equity method
Income tax effect (2.8) (1.4) -
---- ---- ---
Total other comprehensive income (loss) (14.8) 59.9 33.1
----- ---- ----
Total comprehensive income (loss) 109.3 82.7 354.5
===== ==== =====
Profit (loss) attributable to the Company - 124.1 22.8 321.4
basic
===
Earnings (loss) per share attributable to the 0.15 0.03 0.38
Company - basic
===
Earnings (loss) per ADS equivalent - basic 2.92 0.54 7.61
==== ==== ====
Weighted average shares outstanding (in 849,672 849,571 845,206
thousands) - basic
===
Profit (loss) attributable to the Company - 124.1 22.8 321.4
diluted
===
Earnings (loss) per share attributable to the 0.14 0.03 0.38
Company - diluted
===
Earnings (loss) per ADS equivalent - diluted 2.90 0.53 7.54
==== ==== ====
Weighted average shares outstanding (in 857,028 854,443 852,649
thousands) - diluted
===
ChipMOS TECHNOLOGIES INC.
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of Jun. 30, Mar. 31, 2018 and Jun. 30, 2017
Figures in Millions of U.S. dollars (USD) (1)
Jun. 30, 2018 Mar. 31, 2018 Jun. 30, 2017
-------------
ASSETS USD USD USD
------ --- --- ---
Current assets
Cash and cash equivalents 134.2 219.8 364.0
Accounts and notes receivable, net 142.7 119.9 116.2
Inventories 59.2 58.6 63.5
Other current assets 17.5 16.3 9.7
Total current assets 353.6 414.6 553.4
----- ----- -----
Non-current assets
Financial assets at fair value through profit or loss 0.4 0.4 -
Financial assets at fair value through other 3.8 3.3 -
comprehensive income
Non-current financial assets carried at cost - - 0.7
Investments accounted for using equity method 135.2 139.1 115.2
Property, plant & equipment 520.7 516.4 480.5
Other non-current assets 11.5 12.3 11.5
---- ---- ----
Total non-current assets 671.6 671.5 607.9
----- ----- -----
Total assets 1,025.2 1,086.1 1,161.3
======= ======= =======
LIABILITIES AND EQUITY
----------------------
LIABILITIES
-----------
Current liabilities
Short-term bank loans - 34.4 59.6
Accounts payable and payables to contractors and 44.1 41.4 49.1
equipment suppliers
Long-term bank loans, current portion 24.5 70.5 70.4
Long-term lease obligations payable, current portion 0.4 0.4 0.4
Other current liabilities 73.8 56.7 86.3
Total current liabilities 142.8 203.4 265.8
----- ----- -----
Non-current liabilities
Long-term bank loans 250.3 246.6 281.7
Long-term lease obligations payable 0.4 0.5 0.8
Other non-current liabilities 24.8 24.4 23.4
---- ---- ----
Total non-current liabilities 275.5 271.5 305.9
----- ----- -----
Total liabilities 418.3 474.9 571.7
----- ----- -----
EQUITY
------
Capital stock - common stock 291.2 291.2 291.4
Capital surplus 206.4 206.5 206.8
Retained earnings 137.9 142.3 127.2
Other equity interest 4.5 4.3 (2.7)
Treasury stock (33.1) (33.1) (33.1)
----- ----- -----
Equity attributable to equity holders of the Company 606.9 611.2 589.6
Total equity 606.9 611.2 589.6
----- ----- -----
Total liabilities and equity 1,025.2 1,086.1 1,161.3
======= ======= =======
Note:
(1) All U.S. dollar figures in this release are based on the exchange rate of NT$30.43 against US$1.00 as of
Jun. 29, 2018. The convenience translation should not be construed as representations that the NT dollar
amounts have been, or could be in the future be, converted into US dollars at this or any other exchange rate.
ChipMOS TECHNOLOGIES INC.
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of Jun. 30, Mar. 31, 2018 and Jun. 30, 2017
Figures in Millions of NT dollars (NTD)
Jun. 30, 2018 Mar. 31, 2018 Jun. 30, 2017
-------------
ASSETS NTD NTD NTD
------ --- --- ---
Current assets
Cash and cash equivalents 4,082.6 6,688.5 11,078.3
Accounts and notes receivable, net 4,341.9 3,647.8 3,536.1
Inventories 1,800.3 1,785.1 1,931.5
Other current assets 534.3 496.0 294.2
----- ----- -----
Total current assets 10,759.1 12,617.4 16,840.1
-------- -------- --------
Non-current assets
Financial assets at fair value through profit or loss 11.8 11.9 -
Financial assets at fair value through other comprehensive
income 114.7 100.6 -
Non-current financial assets carried at cost - - 20.9
Investments accounted for using equity method 4,114.0 4,231.0 3,506.0
Property, plant & equipment 15,844.2 15,714.6 14,619.8
Other non-current assets 351.6 374.3 350.6
----- ----- -----
Total non-current assets 20,436.3 20,432.4 18,497.3
-------- -------- --------
Total assets 31,195.4 33,049.8 35,337.4
======== ======== ========
LIABILITIES AND EQUITY
----------------------
LIABILITIES
-----------
Current liabilities
Short-term bank loans - 1,046.6 1,814.7
Accounts payable and payables to contractors and equipment
suppliers 1,341.8 1,261.2 1,494.5
Long-term bank loans, current portion 747.3 2,144.0 2,142.0
Long-term lease obligations payable, current portion 11.6 12.0 11.4
Other current liabilities 2,244.9 1,725.5 2,624.8
Total current liabilities 4,345.6 6,189.3 8,087.4
------- ------- -------
Non-current liabilities
Long-term bank loans 7,616.7 7,502.9 8,571.1
Long-term lease obligations payable 12.0 15.0 24.1
Other non-current liabilities 755.1 744.1 712.7
----- ----- -----
Total non-current liabilities 8,383.8 8,262.0 9,307.9
------- ------- -------
Total liabilities 12,729.4 14,451.3 17,395.3
-------- -------- --------
EQUITY
------
Capital stock - common stock 8,859.8 8,861.4 8,866.8
Capital surplus 6,281.2 6,284.2 6,293.8
Retained earnings 4,196.4 4,328.7 3,870.0
Other equity interest 136.2 131.8 (80.9)
Treasury stock (1,007.6) (1,007.6) (1,007.6)
-------- -------- --------
Equity attributable to equity holders of the Company 18,466.0 18,598.5 17,942.1
Total equity 18,466.0 18,598.5 17,942.1
-------- -------- --------
Total liabilities and equity 31,195.4 33,049.8 35,337.4
======== ======== ========
RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE GAAP MEASURES
(Figures in Millions of U.S. dollars (USD))
The table below sets forth a reconciliation of our operating profit to non-GAAP free cash
flow for the periods indicated:
Three months ended
------------------
Jun. 30, 2018 Mar. 31, 2018 Jun. 30, 2017
------------- ------------- -------------
USD USD USD
--- --- ---
Operating profit 13.6 8.5 14.8
Add: Depreciation 27.7 26.7 23.3
Interest income 0.4 0.3 0.5
Less: Capital
expenditures (32.1) (41.5) (45.9)
Interest expense (1.2) (1.3) (1.6)
Income tax expense (11.6) (0.9) (2.3)
Non-GAAP free cash flow (3.2) (8.2) (11.2)
==== ==== =====
The table below sets forth a reconciliation of our operating profit to non-GAAP
EBITDA for the periods indicated:
Three months ended
------------------
Jun. 30, 2018 Mar. 31, 2018 Jun. 30, 2017
------------- ------------- -------------
USD USD USD
--- --- ---
Operating profit 13.6 8.5 14.8
Add: Depreciation 27.7 26.7 23.3
Non-GAAP EBITDA 41.3 35.2 38.1
==== ==== ====
The table below sets forth a calculation of our non-GAAP net debt to equity ratio for the periods
indicated:
Jun. 30, 2018 Mar. 31, 2018 Jun. 30, 2017
------------- ------------- -------------
USD USD USD
--- --- ---
Short-term
bank loans - 34.4 59.6
Long-term bank
loans 274.8 317.1 352.1
(including
current
portion)
Long-term
lease
obligations
payable 0.8 0.9 1.2
(including
current
portion)
Less: Cash and
cash
equivalents (134.2) (219.8) (364.0)
------ ------ ------
Net debt 141.4 132.6 48.9
----- ----- ----
Equity
attributable
to equity
holders of the
Company 606.9 611.2 589.6
----- ----- -----
Net debt to
equity ratio 23.3% 21.7% 8.3%
==== ==== ===
Contacts:
In Taiwan In the U.S.
--------- -----------
Dr. G.S. Shen David Pasquale
ChipMOS TECHNOLOGIES INC. Global IR Partners
+886-3-5668877 +1-914-337-8801
g.s._shen@chipmos.com dpasquale@globalirpartners.com
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SOURCE ChipMOS TECHNOLOGIES INC.
