ASE Technology Holding Co., Ltd. Reports Unaudited Consolidated Financial Results for the Third Quarter of 2020
TAIPEI, Taiwan, R.O.C., Oct. 30, 2020 /PRNewswire/ -- ASE Technology Holding Co., Ltd. (TAIEX: 3711, NYSE: ASX) ("We", "ASEH", or the "Company"), the leading provider of semiconductor manufacturing services in assembly and test, today reported unaudited net revenues[1] of NT$123,195 million for 3Q20, up by 5% year-over-year and up by 15% sequentially. Net income attributable to shareholders of the parent for the quarter totaled NT$6,712 million, up from a net income attributable to shareholders of the parent of NT$5,734 million in 3Q19 and down from a net income attributable to shareholders of the parent of NT$6,937 million in 2Q20. Basic earnings per share for the quarter were NT$1.57 (or US$0.107 per ADS), compared to basic earnings per share of NT$1.35 for 3Q19 and basic earnings per share of NT$1.63 for 2Q20. Diluted earnings per share for the quarter were NT$1.54 (or US$0.105 per ADS), compared to diluted earnings per share of NT$1.33 for 3Q19 and diluted earnings per share of NT$1.60 for 2Q20.
RESULTS OF OPERATIONS
3Q20 Results Highlights - Consolidated
-- Net revenue contribution from packaging operations, testing operations,
EMS operations and others, each represented approximately 46%, 10%, 43%
and 1%, respectively, of total net revenues for the quarter.
-- Cost of revenue was NT$103,475 million for the quarter, up from
NT$88,740 million in 2Q20.
-- Raw material cost totaled NT$62,860 million for the quarter,
representing 51% of total net revenues
-- Labor cost totaled NT$13,725 million for the quarter, representing
11% of total net revenues
-- Depreciation, amortization and rental expenses totaled NT$11,878
million for the quarter.
-- Gross margin decreased 1.5 percentage points to 16.0% in 3Q20 from 17.5%
in 2Q20.
-- Operating margin was 7.4% in 3Q20, compared to 7.8% in 2Q20.
-- In terms of non-operating items:
-- Net interest expense was NT$660 million.
-- Net foreign exchange gain of NT$561 million was primarily
attributable to the depreciation of U.S. dollar against New Taiwan
dollar.
-- Loss on valuation of financial assets and liabilities was NT$406
million.
-- Net gain on equity-method investments was NT$277 million.
-- Other net non-operating income of NT$101 million were primarily
attributable to miscellaneous incomes. Total non-operating expenses
for the quarter were NT$127 million.
-- Income before tax was NT$9,014 million for 3Q20, compared to NT$8,879
million in 2Q20. We recorded income tax expenses of NT$1,797 million for
the quarter, compared to NT$1,646 million in 2Q20.
-- In 3Q20, net income attributable to shareholders of the parent was
NT$6,712 million, compared to net income attributable to shareholders of
the parent of NT$5,734 million in 3Q19 and net income attributable to
shareholders of the parent of NT$6,937 million in 2Q20.
-- Our total number of shares outstanding at the end of the quarter was
4,338,531,132, including treasury stock owned by our subsidiaries. Our
3Q20 basic earnings per share of NT$1.57 (or US$0.107 per ADS) were
based on 4,265,546,050 weighted average numbers of shares outstanding in
3Q20. Our 3Q20 diluted earnings per share of NT$1.54 (or US$0.105 per
ADS) were based on 4,281,115,585 weighted average number of shares
outstanding in 3Q20.
3Q20 Results Highlights - ATM[2]
-- Cost of revenues was NT$57,280 million for the quarter, up by 5%
sequentially.
-- Raw material cost totaled NT$20,102 million for the quarter,
representing 28% of total net revenues.
-- Labor cost totaled NT$12,104 million for the quarter, representing
17% of total net revenues.
-- Depreciation, amortization and rental expenses totaled NT$11,198
million for the quarter.
-- Gross margin decreased 1.5 percentage points to 20.2% in 3Q20 from 21.7%
in 2Q20.
-- Operating margin was 9.5% in 3Q20, compared to 10.4% in 2Q20.
3Q20 Results Highlights - EMS
-- Cost of revenues for the quarter was NT$47,990 million, up by 33%
sequentially.
-- Raw material cost totaled NT$42,621 million for the quarter,
representing 80% of total net revenues.
-- Labor cost totaled NT$1,540 million for the quarter, representing 3%
of total net revenues.
-- Depreciation, amortization and rental expenses totaled NT$551
million for the quarter.
-- Gross margin increased 0.3 percentage points to 9.7% in 3Q20 from 9.4%
in 2Q20.
-- Operating margin increased to 4.4% in 3Q20 from 3.1% in 2Q20.
LIQUIdiTY AND CAPITAL RESOURCES
-- Capital expenditures in 3Q20 totaled US$415 million, of which US$288
million were used in packaging operations, US$73 million in testing
operations, US$52 million in EMS operations and US$2 million in
interconnect materials operations and others.
-- As of September 30, 2020, total unused credit lines amounted to
NT$255,582 million.
-- Current ratio was 1.33 and net debt to equity ratio was 0.75 as of
September 30, 2020.
-- Total number of employees was 97,259 as of September 30, 2020, compared
to 95,448 as of June 30, 2020.
Business Review
Customers
ATM consolidated Basis
-- Our five largest customers together accounted for approximately 48% of
our total net revenues in 3Q20, compared to 50% in 2Q20. Three customers
each accounted for more than 10% of our total net revenues in 3Q20
individually.
-- Our top 10 customers contributed 60% of our total net revenues in 3Q20,
compared to 61% in 2Q20.
-- Our customers that are integrated device manufacturers or IDMs accounted
for 30% of our total net revenues in 3Q20, compared to 29% in 2Q20.
EMS Basis
-- Our five largest customers together accounted for approximately 83% of
our total net revenues in 3Q20, compared to 78% in 2Q20. One customer
accounted for more than 10% of our total net revenues in 3Q20.
-- Our top 10 customers contributed 90% of our total net revenues in 3Q20,
compared to 89% in 2Q20.
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 2019 Annual Report on Form 20-F filed on March 31, 2020.
Supplemental Financial Information
Consolidated Operations
3Q/20
2Q/20
3Q/19
EBITDA (NT$ Millions) 23,230 22,488 21,214
---
ATM Consolidated Operations
3Q/20
2Q/20
3Q/19
Net Revenues (NT$ Millions) 71,820 69,516 67,901
---
Revenues by Application
---
Communication 53% 54% 53%
---
Computer 14% 14% 14%
---
Automotive, Consumer & Others 33% 32% 33%
---
Revenues by Type
---
Bumping, Flip Chip, WLP & SiP 37% 38% 35%
---
Wirebonding 37% 35% 37%
---
Discrete and Others 8% 7% 9%
---
Testing 17% 18% 17%
---
Material 1% 2% 2%
---
Capacity & EBITDA
---
CapEx (US$ Millions)* 362 424 413
---
EBITDA (NT$ Millions) 19,775 20,037 18,312
---
Number of Wirebonders 25,117 24,667 25,008
---
Number of Testers 5,715 5,790 5,254
---
EMS Operations
3Q/20
2Q/20
3Q/19
Net Revenues (NT$ Millions) 53,137 39,709 50,599
Revenues by End Application
---
Communication 40% 46% 36%
---
Computer & Storage 6% 12% 9%
---
Consumer 40% 28% 41%
---
Industrial 9% 10% 9%
---
Automotive 4% 3% 4%
---
Others 1% 1% 1%
---
Capacity
---
CapEx (US$ Millions)* 52 70 23
---
* 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 For the nine months ended
Sep. 30
Jun. 30
Sep. 30
Sep. 30
Sep. 30
2020 2020 2019 2020 2019
Net revenues:
Packaging 56,172 53,622 53,804 161,407 145,263
Testing 12,351 12,690 11,493 36,604 30,729
EMS 53,126 39,703 50,584 125,550 117,055
Others 1,546 1,534 1,676 4,540 4,112
Total net revenues 123,195 107,549 117,557 328,101 297,159
Cost of revenues (103,475) (88,740) (98,449) (273,416) (252,697)
Gross profit 19,720 18,809 19,108 54,685 44,462
Operating expenses:
Research and development (4,926) (4,837) (4,906) (14,372) (13,376)
Selling, general and
administrative (5,653) (5,545) (5,817) (16,682) (16,265)
Total operating expenses (10,579) (10,382) (10,723) (31,054) (29,641)
Operating income 9,141 8,427 8,385 23,631 14,821
Net non-operating
(expenses) income:
Interest expense -net (660) (771) (866) (2,324) (2,741)
Foreign exchange gain
(loss) 561 718 12 955 (508)
Gain (loss) on valuation
of financial assets and
liabilities
(406) (17) (19) (237) 2,339
Gain on equity-method
investments 277 105 148 343 108
Others 101 417 61 762 761
Total non-operating
income (expenses) (127) 452 (664) (501) (41)
Income before tax 9,014 8,879 7,721 23,130 14,780
Income tax expense (1,797) (1,646) (1,501) (4,618) (3,530)
Income from continuing
operations and 7,217 7,233 6,220 18,512 11,250
before noncontrolling
interest
Noncontrolling interest (505) (296) (486) (964) (783)
Net income attributable
to
shareholders of the
parent 6,712 6,937 5,734 17,548 10,467
Per share data:
Earnings (losses) per
share
- Basic
NT$1.57
NT$1.63
NT$1.35
NT$4.12
NT$2.46
- Diluted
NT$1.54
NT$1.60
NT$1.33
NT$4.01
NT$2.40
Earnings (losses) per
equivalent ADS
- Basic
US$0.107
US$0.109
US$0.087
US$0.276
US$0.159
- Diluted
US$0.105
US$0.107
US$0.085
US$0.269
US$0.155
Number of weighted
average shares used in 4,281,115 4,273,770 4,261,515 4,284,010 4,256,985
diluted EPS calculation
(in thousands)
FX (NTD/USD) 29.46 29.94 31.17 29.80 30.99
ASE Technology Holding Co., Ltd.
Summary of Consolidated Statement of Comprehensive Income Data - ATM
(In NT$ millions, except per share data)
(Unaudited)
For the three months ended For the nine months ended
Sep. 30
Jun. 30
Sep. 30
Sep. 30
Sep. 30
2020 2020 2019 2020 2019
Net revenues:
Packaging 58,417 55,732 55,163 167,749 147,980
Testing 12,351 12,693 11,495 36,610 30,732
Direct Material 1,020 1,051 1,211 3,085 3,055
Others 32 40 32 101 100
Total net revenues 71,820 69,516 67,901 207,545 181,867
Cost of revenues (57,280) (54,434) (53,193) (164,589) (147,620)
Gross profit 14,540 15,082 14,708 42,956 34,247
Operating expenses:
Research and
development (3,827) (3,777) (3,894) (11,252) (10,351)
Selling, general and
administrative (3,904) (4,081) (4,401) (12,099) (12,262)
Total operating
expenses (7,731) (7,858) (8,295) (23,351) (22,613)
Operating income 6,809 7,224 6,413 19,605 11,634
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 For the nine months ended
Sep. 30
Jun. 30
Sep. 30
Sep. 30
Sep. 30
2020 2020 2019 2020 2019
Net revenues:
Total net revenues 53,137 39,709 50,599 125,573 117,091
Cost of revenues (47,990) (35,979) (46,105) (113,648) (106,791)
Gross profit 5,147 3,730 4,494 11,925 10,300
Operating expenses:
Research and
development (1,126) (1,085) (1,042) (3,194) (3,107)
Selling, general and
administrative (1,695) (1,403) (1,353) (4,392) (3,853)
Total operating
expenses (2,821) (2,488) (2,395) (7,586) (6,960)
Operating income 2,326 1,242 2,099 4,339 3,340
ASE Technology Holding Co., Ltd.
Summary of Consolidated Balance Sheet Data
(In NT$ millions)
(Unaudited)
As of Sep. 30,
2020 As of Jun. 30, 2020
Current
assets:
Cash and
cash
equivalents 55,814 58,223
Financial
assets -
current 5,993 5,483
Notes and
accounts
receivable 86,718 73,763
Inventories 62,948 50,649
Others 22,167 14,395
Total
current
assets 233,640 202,513
Financial
assets -
non-
current &
Investments
- equity
method
14,279 12,950
Property
plant and
equipment 230,938 238,757
Right-of-
use assets 8,346 9,091
Intangible
assets 76,383 77,154
Others 17,964 18,127
Total assets 581,550 558,592
Current
liabilities:
Short-term
borrowings 34,099 45,814
Current
portion of
bonds
payable &
Current
portion of
long-term
borrowings[3]
13,708 11,366
Notes and
accounts
payable 71,515 54,400
Others 56,152 61,045
Total
current
liabilities 175,474 172,625
Bonds
payable 49,249 39,263
Long-term
borrowings[4] 122,097 115,518
Other
liabilities 17,187 17,251
Total
liabilities 364,007 344,657
Equity
attributable
to
shareholders
of the
parent 205,510 200,409
Non-
controlling
interests 12,033 13,526
Total
liabilities
&
shareholders'
equity 581,550 558,592
Current
Ratio 1.33 1.17
Net Debt to
Equity
Ratio 0.75 0.72
ASE Technology Holding Co., Ltd.
Summary of Consolidated Cash Flow Statements
(In NT$ millions)
(Unaudited)
For the three months ended For the nine months ended
Sep. 30
Jun. 30
Sep. 30
Sep. 30
Sep. 30
2020 2020 2019 2020 2019
Cash Flows from
Operating Activities:
Profit before income
tax 9,014 8,879 7,721 23,130 14,780
Depreciation &
amortization 13,022 12,785 12,610 38,495 37,822
Other operating
activities items (8,550) (1,659) (7,252) (14,686) (11,883)
Net cash generated
from operating
activities 13,486 20,005 13,079 46,939 40,719
Cash Flows from
Investing Activities:
Net payments for
property, plant and
equipment (12,297) (16,587) (18,771) (42,489) (39,100)
Other investment
activities items (156) 1,902 488 1,541 2,464
Net cash used in
investing activities (12,453) (14,685) (18,283) (40,948) (36,636)
Cash Flows from
Financing Activities:
Total net proceeds
from (repayment of)
debts 12,412 (18,900) 26,553 7,401 20,860
Dividends paid (8,521) (10,623) (8,521) (10,623)
Other financing
activities items (5,917) (457) (3,356) (6,178) (4,404)
Net cash generated
from (used in)
financing activities (2,026) (19,357) 12,574 (7,298) 5,833
Foreign currency
exchange effect 243 (1,569) (1,240) (1,351) (214)
Net increase
(decrease) in cash
and cash equivalents (750) (15,606) 6,130 (2,658) 9,702
Cash and cash
equivalents at the
beginning of period 58,223 73,829 55,090 60,131 51,518
Cash and cash
equivalents at the
end of period 57,473 58,223 61,220 57,473 61,220
Cash and cash
equivalents in the
consolidated balance
sheet 55,814 58,223 61,220 55,814 61,220
Cash and cash
equivalents included
in disposal groups
held for sale 1,659 1,659
[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] Current portion of long-term
borrowings include long-term loans
and notes payable.
[4] Long-term borrowings include
long-term loans and bills payable.
Investor Relations Contact:
ir@aseglobal.com
Tel: +886.2.6636.5678
http://www.aseglobal.com
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SOURCE ASE Technology Holding Co., Ltd.
