DELAWARE | 000-29472 | 23-1722724 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
99.1 | Text of Press Release dated April 27, 2016, which is furnished (not filed) herewith. |
AMKOR TECHNOLOGY, INC. | ||||
By: | /s/ Joanne Solomon | |||
Joanne Solomon | ||||
Executive Vice President and Chief Financial Officer | ||||
Exhibit | Description | |
99.1 | Text of Press Release dated April 27, 2016, which is furnished (not filed) herewith. |
News Release |
• | Net sales $869 million |
• | Gross margin 14.1% |
• | Net income and earnings per diluted share at breakeven |
• | Includes consolidation of J-Devices' operating results for the first time |
• | Automotive revenues of $220 million in Q1, up 7% sequentially and 6% year-over-year on a combined basis with J-Devices |
GAAP Results | Q1 2016 | Q4 2015 | Q1 2015 |
($ in millions, except per share data) | |||
Net sales | $869 | $671 | $743 |
Gross margin | 14.1% | 15.3% | 18.2% |
Net income (loss) | ($1) | ($10) | $29 |
Earnings per diluted share | $— | ($0.04) | $0.12 |
Non-GAAP Results* | Q1 2016 | Q4 2015 | Q1 2015 |
($ in millions, except per share data) | |||
Net sales | $869 | $671 | $743 |
Gross margin | 14.1% | 15.3% | 18.2% |
Net income (loss) | ($1) | $4 | $29 |
Earnings per diluted share | $— | $0.02 | $0.12 |
EBITDA | $155 | $131 | $184 |
Adjusted EBITDA | $155 | $145 | $184 |
• | Net sales of $850 million to $900 million, down 2% to up 4% from the prior quarter |
• | Gross margin of 10% to 13% |
• | Net loss of $11 million to $33 million, or ($0.04) to ($0.14) per share |
• | Full year 2016 capital expenditures of around $650 million, unchanged from our previous forecast |
Q1 2016 | Q4 2015 | Q1 2015 | |||||||||
Net Sales Data: | |||||||||||
Net sales (in millions): | |||||||||||
Advanced products* | $ | 356 | $ | 333 | $ | 373 | |||||
Mainstream products** | 513 | 338 | 370 | ||||||||
Total net sales | $ | 869 | $ | 671 | $ | 743 | |||||
Packaging services | 82 | % | 85 | % | 85 | % | |||||
Test services | 18 | % | 15 | % | 15 | % | |||||
Net sales from top ten customers | 67 | % | 64 | % | 60 | % | |||||
Packaged units (in millions): | |||||||||||
Advanced products* | 941 | 1,196 | 1,188 | ||||||||
Mainstream products** | 3,048 | 2,492 | 2,671 | ||||||||
Total packaged units | 3,989 | 3,688 | 3,859 | ||||||||
End Market Distribution Data (an approximation including representative devices and applications based on a sampling of our largest customers): | |||||||||||
Communications (smart phones, tablets, handheld devices, wireless LAN) | 42 | % | 54 | % | 57 | % | |||||
Automotive, industrial and other (infotainment, safety, performance, comfort) | 25 | % | 15 | % | 11 | % | |||||
Consumer (televisions, set top boxes, gaming, portable media, digital cameras) | 16 | % | 12 | % | 12 | % | |||||
Networking (servers, routers, switches) | 10 | % | 11 | % | 11 | % | |||||
Computing (PCs, hard disk drives, printers, peripherals, servers) | 7 | % | 8 | % | 9 | % | |||||
Total | 100 | % | 100 | % | 100 | % | |||||
Gross Margin Data: | |||||||||||
Net sales | 100.0 | % | 100.0 | % | 100.0 | % | |||||
Cost of sales: | |||||||||||
Materials | 37.5 | % | 35.8 | % | 36.7 | % | |||||
Labor | 16.2 | % | 15.8 | % | 14.2 | % | |||||
Other manufacturing | 32.2 | % | 33.1 | % | 30.9 | % | |||||
Gross margin | 14.1 | % | 15.3 | % | 18.2 | % |
Non-GAAP Financial Measures Reconciliation: | |||||||||||
Q1 2016 | Q4 2015 | Q1 2015 | |||||||||
(in millions, except per share amounts) | |||||||||||
Net income (loss) attributable to Amkor | $ | (1 | ) | $ | (10 | ) | $ | 29 | |||
Plus: Net loss on acquisition of J-Devices, net of tax | — | 14 | — | ||||||||
Non-GAAP net income (loss) | $ | (1 | ) | $ | 4 | $ | 29 | ||||
Earnings per diluted share | $ | — | $ | (0.04 | ) | $ | 0.12 | ||||
Plus: Net loss on acquisition of J-Devices per diluted share, net of tax | — | 0.06 | — | ||||||||
Non-GAAP earnings per diluted share | $ | — | $ | 0.02 | $ | 0.12 |
Non-GAAP Financial Measures Reconciliation: | |||||||||||
Q1 2016 | Q4 2015 | Q1 2015 | |||||||||
(in millions) | |||||||||||
EBITDA Data: | |||||||||||
Net income (loss) attributable to Amkor | $ | (1 | ) | $ | (10 | ) | $ | 29 | |||
Plus: Interest expense | 17 | 18 | 25 | ||||||||
Plus: Income tax expense | 2 | 1 | 6 | ||||||||
Plus: Depreciation & amortization | 137 | 122 | 124 | ||||||||
EBITDA | $ | 155 | $ | 131 | $ | 184 | |||||
Plus: Net loss on acquisition of J-Devices | — | 14 | — | ||||||||
Adjusted EBITDA | $ | 155 | $ | 145 | $ | 184 |
For the Three Months Ended March 31, | |||||||
2016 | 2015 | ||||||
(In thousands, except per share data) | |||||||
Net sales | $ | 868,682 | $ | 742,875 | |||
Cost of sales | 745,798 | 607,928 | |||||
Gross profit | 122,884 | 134,947 | |||||
Selling, general and administrative | 73,635 | 62,942 | |||||
Research and development | 27,155 | 18,026 | |||||
Total operating expenses | 100,790 | 80,968 | |||||
Operating income | 22,094 | 53,979 | |||||
Interest expense | 16,192 | 23,777 | |||||
Interest expense, related party | 1,242 | 1,242 | |||||
Other (income) expense, net | 3,192 | (498 | ) | ||||
Total other expense, net | 20,626 | 24,521 | |||||
Income before taxes and equity in earnings of unconsolidated affiliate | 1,468 | 29,458 | |||||
Income tax expense | 1,873 | 5,999 | |||||
Income (loss) before equity in earnings of unconsolidated affiliate | (405 | ) | 23,459 | ||||
Equity in earnings of J-Devices | — | 6,238 | |||||
Net income (loss) | (405 | ) | 29,697 | ||||
Net income attributable to noncontrolling interests | (470 | ) | (916 | ) | |||
Net income (loss) attributable to Amkor | $ | (875 | ) | $ | 28,781 | ||
Net income (loss) attributable to Amkor per common share: | |||||||
Basic | $ | — | $ | 0.12 | |||
Diluted | $ | — | $ | 0.12 | |||
Shares used in computing per common share amounts: | |||||||
Basic | 237,025 | 236,708 | |||||
Diluted | 237,025 | 237,424 |
March 31, 2016 | December 31, 2015 | ||||||
(In thousands) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 413,465 | $ | 523,172 | |||
Restricted cash | 2,000 | 2,000 | |||||
Accounts receivable, net of allowances | 537,745 | 526,143 | |||||
Inventories | 237,000 | 238,205 | |||||
Other current assets | 29,363 | 27,960 | |||||
Total current assets | 1,219,573 | 1,317,480 | |||||
Property, plant and equipment, net | 2,616,227 | 2,579,017 | |||||
Goodwill | 20,840 | 19,443 | |||||
Restricted cash | 2,222 | 2,176 | |||||
Other assets | 100,292 | 104,346 | |||||
Total assets | $ | 3,959,154 | $ | 4,022,462 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Short-term borrowings and current portion of long-term debt | $ | 26,183 | $ | 76,770 | |||
Trade accounts payable | 407,698 | 434,222 | |||||
Capital expenditures payable | 199,944 | 242,980 | |||||
Accrued expenses | 306,285 | 264,212 | |||||
Total current liabilities | 940,110 | 1,018,184 | |||||
Long-term debt | 1,433,426 | 1,435,269 | |||||
Long-term debt, related party | 75,000 | 75,000 | |||||
Pension and severance obligations | 176,631 | 167,197 | |||||
Other non-current liabilities | 88,820 | 101,679 | |||||
Total liabilities | 2,713,987 | 2,797,329 | |||||
Stockholders’ equity: | |||||||
Preferred stock | — | — | |||||
Common stock | 283 | 283 | |||||
Additional paid-in capital | 1,884,397 | 1,883,592 | |||||
Accumulated deficit | (461,025 | ) | (460,150 | ) | |||
Accumulated other comprehensive income (loss) | 17,804 | (2,084 | ) | ||||
Treasury stock | (213,877 | ) | (213,758 | ) | |||
Total Amkor stockholders’ equity | 1,227,582 | 1,207,883 | |||||
Noncontrolling interests in subsidiaries | 17,585 | 17,250 | |||||
Total equity | 1,245,167 | 1,225,133 | |||||
Total liabilities and equity | $ | 3,959,154 | $ | 4,022,462 |
For the Three Months Ended March 31, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ | (405 | ) | $ | 29,697 | ||
Depreciation and amortization | 137,136 | 124,387 | |||||
Other operating activities and non-cash items | (3,944 | ) | (9,525 | ) | |||
Changes in assets and liabilities | 5,311 | 20,465 | |||||
Net cash provided by operating activities | 138,098 | 165,024 | |||||
Cash flows from investing activities: | |||||||
Payments for property, plant and equipment | (198,788 | ) | (106,149 | ) | |||
Proceeds from sale of property, plant and equipment | 121 | 3,254 | |||||
Investment in J-Devices | — | (12,908 | ) | ||||
Other investing activities | (472 | ) | (322 | ) | |||
Net cash used in investing activities | (199,139 | ) | (116,125 | ) | |||
Cash flows from financing activities: | |||||||
Borrowings under revolving credit facilities | — | 30,000 | |||||
Payments under revolving credit facilities | (40,000 | ) | — | ||||
Payments of short-term debt | (11,901 | ) | — | ||||
Payments of long-term debt | (4,204 | ) | (35,000 | ) | |||
Payments for debt issuance costs | (156 | ) | — | ||||
Payments for capital lease obligations | (401 | ) | — | ||||
Proceeds from the issuance of stock through share-based compensation plans | — | 574 | |||||
Payments of tax withholding for restricted shares | (119 | ) | (230 | ) | |||
Payments of subsidiary dividends to noncontrolling interests | (135 | ) | — | ||||
Net cash used in financing activities | (56,916 | ) | (4,656 | ) | |||
Effect of exchange rate fluctuations on cash and cash equivalents | 8,250 | — | |||||
Net increase (decrease) in cash and cash equivalents | (109,707 | ) | 44,243 | ||||
Cash and cash equivalents, beginning of period | 523,172 | 449,946 | |||||
Cash and cash equivalents, end of period | $ | 413,465 | $ | 494,189 |
• | there can be no assurance that our recovery from the recent earthquakes in Japan will occur as quickly as expected, or that the actual costs and financial impact will be consistent with our current expectations, for example due to additional earthquakes, shortages in labor or supplies for repairs or operations, increased inventory or repair costs, shortages in customer materials, changes in customer preferences, demand or loadings, or delays or shortfalls in insurance payments; |
• | there can be no assurance regarding when our new K5 facility in Korea will be fully utilized, or that the actual scope, costs, timeline or benefits of the project will be consistent with our current expectations; |
• | the highly unpredictable nature and cyclicality of the semiconductor industry; |
• | timing and volume of orders relative to production capacity and the inability to achieve high capacity utilization rates, control costs and improve profitability; |
• | volatility of consumer demand, double booking by customers and deterioration in forecasts from our customers for products incorporating our semiconductor packages, including any slowdown in demand or changes in customer forecasts for smartphones or other mobile devices and generally soft end market demand for electronic devices; |
• | delays, lower manufacturing yields and supply constraints relating to wafers, particularly for advanced nodes and related technologies; |
• | dependence on key customers and the impact of changes in our market share and prices for our services with those customers; |
• | the performance of our business, economic and market conditions, the cash needs and investment opportunities for the business, the need for additional capacity and facilities to service customer demand and the availability of cash flow from operations or financing; |
• | the effect of the global economy on credit markets, financial institutions, customers, suppliers and consumers, including the uncertain macroeconomic environment; |
• | the highly unpredictable nature and costs of litigation and other legal activities and the risk of adverse results of such matters and the impact of other legal proceedings; |
• | changes in tax rates and taxes as a result of changes in U.S. or foreign tax law, the jurisdictions in which our income is determined to be earned and taxed, the outcome of tax audits and tax ruling requests, our ability to realize deferred tax assets and the expiration of tax holidays; |
• | curtailment of outsourcing by our customers; |
• | our substantial indebtedness and restrictive covenants; |
• | failure to realize sufficient cash flow or access to other sources of liquidity to fund capital expenditures; |
• | the effects of an economic slowdown in major economies worldwide, particularly the recent slowdown in China; |
• | disruptions in our business or deficiencies in our controls resulting from the integration of newly acquired operations, particularly J-Devices, or the implementation and security of, and changes to, our enterprise resource planning, factory shop floor systems and other management information systems; |
• | economic effects of terrorist attacks, military conflict and natural disasters such as the recent earthquakes in Japan; |
• | competition, competitive pricing and declines in average selling prices; |
• | fluctuations in manufacturing yields; |
• | dependence on international operations and sales and exchange rate fluctuations; |
• | dependence on raw material and equipment suppliers and changes in raw material and precious metal costs, including any disruptions in the supply chain resulting from the recent earthquakes in Japan; |
• | dependence on key personnel; |
• | enforcement of and compliance with intellectual property rights; |
• | environmental and other governmental regulations; and |
• | technological challenges. |