ASE Technology Holding Co., Ltd. Reports Unaudited Consolidated Financial Results for the First Quarter of 2019
TAIPEI, Taiwan, R.O.C., April 30, 2019 /PRNewswire/ -- ASE Technology Holding Co., Ltd. (TAIEX: 3711, NYSE: ASX) ("We", "ASEH", or the "Company") was established following the completion of the merger between Advanced Semiconductor Engineering, Inc. ("ASE") and Siliconware Precision Industries Co., Ltd. on April 30, 2018. ASE is the Company's predecessor entity; therefore, the financial results of the Company for periods before merger are prepared under the assumption that the Company owned 100% shareholdings of ASE at the very beginning. The financial results after April 30, 2018, including both 1Q19 and 4Q18, reflect full quarters of combined operations following the completion of the merger. The financial results before April 30, 2018 reflect the operations of ASE and its subsidiaries prior to the establishment of the Company. As a result, the Company's financial results for 1Q19 and 4Q18 may not be comparable to that for 1Q18. ASEH, the leading provider of semiconductor manufacturing services in assembly and test, today reported unaudited net revenues([1]) of NT$88,861 million for 1Q19, up by 37% year-over-year and down by 22% sequentially. Net income attributable to shareholders of the parent for the quarter totaled NT$2,043 million, down from a net income attributable to shareholders of the parent of NT$2,096 million in 1Q18 and down from a net income attributable to shareholders of the parent of NT$5,446 million in 4Q18. Basic earnings per share for the quarter were NT$0.48 (or US$0.031 per ADS), compared to adjusted basic earnings per share of NT$0.49 for 1Q18 and basic earnings per share of NT$1.28 for 4Q18. Diluted earnings per share for the quarter were NT$0.46 (or US$0.030 per ADS), compared to adjusted diluted earnings per share of NT$0.48 for 1Q18 and diluted earnings per share of NT$1.24 for 4Q18.
RESULTS OF OPERATIONS
1Q19 Results Highlights -- Consolidated
-- Net revenue contribution from packaging operations, testing operations,
EMS operations and others, each represented approximately 50%, 10%, 39%
and 1%, respectively, of total net revenues for the quarter.
-- Cost of revenue was NT$77,476 million for the quarter, down from
NT$95,344 million in 4Q18.
-- Raw material cost totaled NT$43,928 million for the quarter,
representing 49% of total net revenues.
-- Labor cost totaled NT$11,931 million for the quarter, representing
13% of total net revenues.
-- Depreciation, amortization and rental expenses totaled NT$11,572
million for the quarter.
-- Gross margin decreased 3.6 percentage points to 12.8% in 1Q19 from 16.4%
in 4Q18.
-- Operating margin was 2.6% in 1Q19 compared to 7.5% in 4Q18.
-- In terms of non-operating items:
-- Net interest expense was NT$966 million.
-- Net foreign exchange loss of NT$180 million was primarily
attributable to the appreciation of U.S. dollar against NT dollar.
-- Gain on valuation of financial assets and liabilities was NT$1,556
million.
-- Net loss on equity-method investments was NT$154 million.
-- Other net non-operating incomes of NT$86 million were primarily
attributable to miscellaneous incomes. Total non-operating incomes
for the quarter were NT$342 million.
-- Income before tax was NT$2,635 million for 1Q19, compared to NT$7,235
million in 4Q18. We recorded income tax expenses of NT$405 million for
the quarter, compared to NT$1,342 million in 4Q18.
-- In 1Q19, net income attributable to shareholders of the parent was
NT$2,043 million, compared to net income attributable to shareholders of
the parent of NT$2,096 million in 1Q18 and net income attributable to
shareholders of the parent of NT$5,446 million in 4Q18.
-- Our total number of shares outstanding at the end of the quarter was
4,322,625,732, including treasury stock owned by our subsidiaries. Our
1Q19 basic earnings per share of NT$0.48 (or US$0.031 per ADS) were
based on 4,249,572,979 weighted average numbers of shares outstanding in
1Q19. Our 1Q19 diluted earnings per share of NT$0.46 (or US$0.030 per
ADS) were based on 4,255,559,025 weighted average number of shares
outstanding in 1Q19.
1Q19 Results Highlights -- ATM([2])
-- Cost of revenues was NT$45,933 million for the quarter, down by 8%
sequentially.
-- Raw material cost totaled NT$15,281 million for the quarter,
representing 28% of total net revenues.
-- Labor cost totaled NT$10,493 million for the quarter, representing
19% of total net revenues.
-- Depreciation, amortization and rental expenses totaled NT$10,970
million for the quarter.
-- Gross margin decreased 6.3 percentage points to 15.5% in 1Q19 from 21.8%
in 4Q18.
-- Operating margin was 2.9% in 1Q19 compared to 9.8% in 4Q18.
1Q19 Results Highlights -- EMS
-- Cost of revenues for the quarter was NT$32,029 million, down by 31%
sequentially.
-- Raw material cost totaled NT$28,702 million for the quarter,
representing 82% of total net revenues.
-- Labor cost totaled NT$1,417 million for the quarter, representing 4%
of total net revenues.
-- Depreciation, amortization and rental expenses totaled NT$484
million for the quarter.
-- Gross margin decreased to 8.4% in 1Q19 from 9.1% in 4Q18.
-- Operating margin increased to 2.1% in 1Q19 from 4.3% in 4Q18.
LIQUIDITY AND CAPITAL RESOURCES
-- Capital expenditures in 1Q19 totaled US$239 million, of which US$156
million were used in packaging operations, US$72 million in testing
operations, US$8 million in EMS operations and US$3 million in
interconnect materials operations and others.
-- As of March 31, 2019, total unused credit lines amounted to NT$207,722
million.
-- Current ratio was 1.23 and net debt to equity ratio was 0.58 as of March
31, 2019.
-- Total number of employees was 90,370 as of March 31, 2019, compared to
93,891 as of December 31, 2018.
BUSINESS REVIEW
Customers
ATM CONSOLIDATED BASIS
-- Our five largest customers together accounted for approximately 47% of
our total net revenues in 1Q19, compared to 41% in 4Q18. One customer
accounted for more than 10% of our total net revenues in 1Q19.
-- Our top 10 customers contributed 60% of our total net revenues for the
quarter, compared to 56% in 4Q18.
-- Our customers that are integrated device manufacturers or IDMs accounted
for 35% of our total net revenues both in 1Q19 and in 4Q18.
EMS BASIS
-- Our five largest customers together accounted for approximately 75% of
our total net revenues in 1Q19, compared to 82% in 4Q18. One customer
accounted for more than 10% of our total net revenues in 1Q19.
-- Our top 10 customers contributed 87% of our total net revenues during
the quarter in 1Q19, compared to 91% in 4Q18.
About ASE Technology Holding Co., Ltd.
ASEH is the leading provider of semiconductor manufacturing services in assembly and test. The Company develops and offers complete turnkey solutions covering front-end engineering test, wafer probing and final test, as well as IC packaging, materials and electronic manufacturing services through USI with superior technologies, breakthrough innovations, and advanced development programs. With advanced technological capabilities and a global presence spanning Taiwan, China, South Korea, Japan, Singapore, Malaysia and Mexico as well as the United States and Europe, ASEH has established a reputation for reliable, high quality products and services. For more
information, please visit our website at http://www.aseglobal.com.
Safe Harbor Notice:
This press release contains "forward-looking statements" within the meaning of Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended. Although these forward-looking statements, which may include statements regarding our future results of operations, financial condition or business prospects, are based on our own information and information from other sources we believe to be reliable, you should not place undue reliance on these forward-looking statements, which apply only as of the date of this press release. The words "anticipate," "believe," "estimate," "expect," "intend," "plan" and similar expressions, as they relate to us, are intended to identify these forward-looking statements in this press release. These forward-looking statements are necessarily estimates reflecting the best judgment of our senior management and our actual results of operations, financial condition or business prospects may differ materially from those expressed or implied by the forward-looking statements for reasons including, among others, risks associated with cyclicality and market conditions in the semiconductor or electronic industry; changes in our regulatory environment, including our ability to comply with new or stricter environmental regulations and to resolve environmental liabilities; demand for the outsourced semiconductor packaging, testing and electronic manufacturing services we offer and for such outsourced services generally; the highly competitive semiconductor or manufacturing industry we are involved in; our ability to introduce new technologies in order to remain competitive; international business activities; our business strategy; our future expansion plans and capital expenditures; the strained relationship between the Republic of China and the People's Republic of China; general economic and political conditions; the recent shift in United States trade policies; possible disruptions in commercial activities caused by natural or human-induced disasters; fluctuations in foreign currency exchange rates; and other factors. For a discussion of these risks and other factors, please see the documents we file from time to time with the Securities and Exchange Commission, including the 2018 Annual Report on Form 20-F filed on April 26, 2019.
[1] All financial information
presented in this press release is
unaudited, consolidated and prepared
in accordance with Taiwan-IFRS
(International Financial Reporting
Standards as endorsed for use in the
R.O.C.). Such financial information
is generated internally by us and
has not been subjected to the same
review and scrutiny, including
internal auditing procedures and
audit by our independent auditors,
to which we subject our audited
consolidated financial statements,
and may vary materially from the
audited consolidated financial
information for the same period.
Any evaluation of the financial
information presented in this press
release should also take into
account our published audited
consolidated financial statements
and the notes to those statements.
In addition, the financial
information presented is not
necessarily indicative of our
results of operations for any future
period.
[2] ATM stands for Semiconductor
Assembly, Testing and Material.
[3] Per share data for the three
months ended March 31, 2018 has been
retrospective adjusted to reflect
the impact from the joint share
exchange agreement.
Supplemental Financial Information
Consolidated Operations
1Q/19
4Q/18
1Q/18
EBITDA (NT$ Millions) 16,523 21,082 11,893
---
ATM Consolidated Operations
1Q/19
4Q/18
1Q/18
Net Revenues (NT$ Millions) 54,371 64,120 37,072
---
Revenues by Application
---
Communication 53% 52% 46%
---
Computer 13% 14% 13%
---
Automotive, Consumer & Others 34% 34% 41%
---
Revenues by Type
---
Bumping, Flip Chip, WLP & SiP 34% 33% 26%
---
Wirebonding 40% 39% 47%
---
Discrete and Others 8% 9% 9%
---
Testing 16% 17% 15%
---
Material 2% 2% 3%
---
Capacity & EBITDA
---
CapEx (US$ Millions)* 231 237 202
---
EBITDA (NT$ Millions) 14,620 18,271 10,393
---
Number of Wirebonders 25,033 25,172 16,015
---
Number of Testers 4,857 4,822 3,801
---
EMS Operations
1Q/19
4Q/18
1Q/18
---
Net Revenues
(NT$
Millions) 34,959 50,745 28,691
Revenues by End Application
---
Communication 29% 32% 42%
---
Computer &
Storage 13% 10% 17%
---
Consumer 38% 44% 24%
---
Industrial 14% 10% 9%
---
Automotive 5% 4% 7%
---
Others 1% 0% 1%
---
Capacity
---
CapEx (US$
Millions)* 8 11 7
---
* Capital expenditure excludes building construction costs.
ASE Technology Holding Co., Ltd.
Summary of Consolidated Statement of Comprehensive Income Data
(In NT$ millions, except per share data)
(Unaudited)
For the three months ended
Mar. 31
Dec. 31
Mar. 31
2019 2018 2018
Net revenues:
Packaging 43,857 51,149 29,368
Testing 8,951 10,919 5,679
EMS 34,947 50,736 28,686
Others 1,106 1,224 1,233
Total net revenues 88,861 114,028 64,966
Cost of revenues (77,476) (95,344) (54,578)
Gross profit 11,385 18,684 10,388
Operating expenses:
Research and
development (3,955) (4,293) (2,775)
Selling, general and
administrative (5,137) (5,818) (3,297)
Total operating
expenses (9,092) (10,111) (6,072)
Operating income 2,293 8,573 4,316
Net non-operating (expenses) income:
Interest expense -net (966) (923) (357)
Foreign exchange gain
(loss) (180) (311) 502
Gain (loss) on
valuation of
financial assets and
liabilities 1,556 140 (379)
Gain (loss) on equity-
method investments (154) 6 (444)
Others 86 (250) 138
Total non-operating
income (expenses) 342 (1,338) (540)
Income before tax 2,635 7,235 3,776
Income tax expense (405) (1,342) (1,420)
Income from continuing
operations and 2,230 5,893 2,356
before noncontrolling interest
Noncontrolling
interest (187) (447) (260)
Net income attributable to
shareholders of the
parent 2,043 5,446 2,096
===
Per share data[3]:
Earnings (losses) per share
- Basic
NT$0.48
NT$1.28
NT$0.49
- Diluted
NT$0.46
NT$1.24
NT$0.48
Earnings (losses) per equivalent ADS
- Basic
US$0.031
US$0.083
US$0.034
- Diluted
US$0.030
US$0.081
US$0.032
Number of weighted
average shares used
in 4,255,559 4,254,978 4,336,571
diluted EPS calculation (in
thousands)
FX (NTD/USD) 30.77 30.79 29.33
ASE Technology Holding Co., Ltd.
Summary of Consolidated Statement of Comprehensive Income Data -- ATM
(In NT$ millions, except per share data)
(Unaudited)
For the three months ended
Mar. 31
Dec. 31
Mar. 31
2019 2018 2018
Net revenues:
Packaging 44,488 52,068 30,313
Testing 8,951 10,920 5,679
Direct Material 900 1,093 1,050
Others 32 39 30
Total net revenues 54,371 64,120 37,072
Cost of revenues (45,933) (50,158) (29,371)
Gross profit 8,438 13,962 7,701
Operating expenses:
Research and
development (3,043) (3,349) (1,865)
Selling, general and
administrative (3,841) (4,306) (2,418)
Total operating
expenses (6,884) (7,655) (4,283)
Operating income 1,554 6,307 3,418
ASE Technology Holding Co., Ltd.
Summary of Consolidated Statement of Comprehensive Income Data -- EMS
(In NT$ millions, except per share data)
(Unaudited)
For the three months ended
Mar. 31
Dec. 31
Mar. 31
2019 2018 2018
Net revenues:
Total net revenues 34,959 50,745 28,691
Cost of revenues (32,029) (46,135) (25,991)
Gross profit 2,930 4,610 2,700
Operating expenses:
Research and
development (940) (967) (926)
Selling, general and
administrative (1,252) (1,463) (832)
Total operating
expenses (2,192) (2,430) (1,758)
Operating income 738 2,180 942
ASE Technology Holding Co., Ltd.
Summary of Consolidated Balance Sheet Data
(In NT$ millions)
(Unaudited)
As of Mar. 31 ,
2019 As of Dec. 31 , 2018
Current assets:
Cash and cash equivalents 59,317 51,518
Financial assets - current 11,099 13,802
Notes and accounts
receivable 63,391 79,481
Inventories 45,369 46,688
Others 9,657 10,070
Total current assets 188,833 201,559
Financial assets --non
current & Investments --
equity
method 13,285 12,555
Property plant and equipment 212,639 214,593
Right-of-use assets 10,531
Intangible assets 79,630 80,216
Prepaid lease payments 10,765
Others 20,404 13,683
Total assets 525,322 533,371
Current liabilities:
Short-term borrowings 49,207 43,264
Current portion of long-
term borrowings 17,197 10,779
Notes and accounts payable 43,095 56,884
Others 43,523 45,372
Total current liabilities 153,022 156,299
Bonds payable 16,987 16,986
Long-term borrowings 112,038 127,119
Other liabilities 17,378 12,297
Total liabilities 299,425 312,701
Shareholders of the parent 207,766 203,023
Noncontrolling interest 18,131 17,647
Total liabilities &
shareholders' equity 525,322 533,371
Current Ratio 1.23 1.29
Net Debt to Equity 0.58 0.60
ASE Technology Holding Co., Ltd.
Summary of Consolidated Cash Flow Statements
(In NT$ millions)
(Unaudited)
For the three months ended
Mar. 31
Dec. 31 Mar. 31
2019 2018 2018
Cash Flows from Operating
Activities:
Profit before income tax 2,635 7,235 3,776
Depreciation & amortization 12,575 12,220 7,232
Other operating activities
items 813 (920) (2,276)
Net cash generated from
operating activities 16,023 18,535 8,732
Cash Flows from Investing
Activities:
Net payments for property,
plant (8,878) (9,993) (5,547)
and equipment
Other investment activities
items 2,750 (6,230) (3,993)
Net cash used in investing
activities (6,128) (16,223) (9,540)
Cash Flows from Financing
Activities:
Total net repayment of debts (3,172) (10,208) (504)
Other financing activities
items (157) 3,255 (1,585)
Net cash used in financing
activities (3,329) (6,953) (2,089)
Foreign currency exchange
effect 1,233 824 (35)
Net increase (decrease) in cash 7,799 (3,817) (2,932)
and cash equivalents
Cash and cash equivalents at
the beginning of period 51,518 55,335 46,078
Cash and cash equivalents at
the 59,317 51,518 43,146
end of period
IR Contact:
Iris Wu, Senior Manager
US contact:
Grace Teng, Manager
iris.wu@asetechholding.com
Echo Lin, Senior Associate
grace_teng@aseglobal.com
Tel: +886.2.6636.5678
echo.lin@asetechholding.com
Tel: +886.2.6636.5678
http://www.aseglobal.com
+1.510.687.2491
View original content:http://www.prnewswire.com/news-releases/ase-technology-holding-co-ltd-reports-unaudited-consolidated-financial-results-for-the-first-quarter-of-2019-300840336.html
SOURCE ASE Technology Holding Co., Ltd.
