TAIPEI, Taiwan, April 29, 2016 /PRNewswire/ -- Advanced Semiconductor Engineering, Inc. (TAIEX: 2311, NYSE: ASX) ("We", "ASE", or the "Company"), the world's largest independent provider of packaging and testing services, today reported unaudited net revenues[1] of NT$62,371 million for the first quarter of 2016 (1Q16), down by 4% year-over-year and down by 17% sequentially.  Net income attributable to shareholders of the parent for the quarter totaled NT$4,163 million, down from a net income attributable to shareholders of the parent of NT$4,469 million in 1Q15 and down from a net income attributable to shareholders of the parent of NT$4,990 million in 4Q15.  Basic earnings per share for the quarter were NT$0.54 (or US$0.082 per ADS), compared to basic earnings per share of NT$0.58 for 1Q15 and NT$0.65 for 4Q15. Diluted earnings per share for the quarter were NT$0.43 (or US$0.065 per ADS), compared to diluted earnings per share of NT$0.56 for 1Q15 and NT$0.63 for 4Q15.

[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.

RESULTS OF OPERATIONS

1Q16 Results Highlights – Consolidated

  • Net revenue contribution from packaging operations, testing operations, EMS operations, substrates sold to third parties and others, each represented approximately 45%, 10%, 40%, 1% and 4%, respectively, of total net revenues for the quarter.
  • Cost of revenue was NT$50,922 million for the quarter, down from NT$62,279 million in 4Q15.
    • Raw material cost totaled NT$27,357 million during the quarter, representing 44% of total net revenues.
    • Labor cost totaled NT$8,284 million during the quarter, representing 13% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$7,010 million during the quarter.
  • Gross margin increased 0.8 percentage points to 18.4% in 1Q16 from 17.6% in 4Q15.
  • Operating margin was 8.3% in 1Q16 compared to 9.0% in 4Q15.
  • In terms of non-operating items:
    • Net interest expense was NT$527 million.
    • Net foreign exchange gain of NT$881 million was primarily attributable to the depreciation of the U.S. dollar against the NT dollar.
    • Loss on valuation of financial assets and liabilities was NT$360 million.
    • Net gain on equity-method investments was NT$385 million, including NT$401 million of the share of profit from our investment in Siliconware Precision Industries Co., Ltd.
    • Other net non-operating income of NT$71 million was primarily related to miscellaneous income. Total non-operating income for the quarter were NT$450 million.
  • Income before tax was NT$5,656 million for 1Q16, compared to NT$6,572 million in 4Q15. We recorded income tax expenses of NT$1,318 million during the quarter, compared to NT$1,260 million in 4Q15.
  • In 1Q16, net income attributable to shareholders of the parent was NT$4,163 million, compared to net income attributable to shareholders of the parent of NT$4,469 million for 1Q15 and net income attributable to shareholders of the parent of NT$4,990 million for 4Q15.
  • Our total number of shares outstanding at the end of the quarter was 7,918,272,896, including treasury stock owned by our subsidiaries. Our 1Q16 basic earnings per share of NT$0.54 (or US$0.082 per ADS) were based on 7,649,385,595 weighted average number of shares outstanding in 1Q16. Our 1Q16 diluted earnings per share of NT$0.43 (or US$0.065 per ADS) were based on 8,293,276,666 weighted average number of shares outstanding in 1Q16.

1Q16 Results Highlights – IC ATM[2]

  • Cost of revenues was NT$27,711 million for the quarter, down by 3% sequentially.
    • Raw material cost totaled NT$8,086 million during the quarter, representing 23% of total net revenues.
    • Labor cost totaled NT$7,194 million during the quarter, representing 20% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$6,379 million during the quarter.
  • Gross margin decreased 4.0 percentage points to 22.0% in 1Q16 from 26.0% in 4Q15.
  • Operating margin was 9.1% in 1Q16 compared to 13.8% in 4Q15.

[2] ATM stands for Semiconductor Assembly, Testing and Material.

1Q16 Results Highlights – EMS

  • Cost of revenues for the quarter was NT$22,781 million, down by 38% sequentially.
    • Raw material cost totaled NT$19,310 million during the quarter, representing 78% of total net revenues.
    • Labor cost totaled NT$1,089 million during the quarter, representing 4% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$667 million during the quarter.
  • Gross margin increased to 8.1% in 1Q16 from 7.3% in 4Q15.
  • Operating margin decreased to 1.5% in 1Q16 from 2.7% in 4Q15.

LIQUIDITY AND CAPITAL RESOURCES

  • Capital expenditures in 1Q16 totaled US$115 million, of which US$62 million were used for packaging, US$47 million for testing, US$2 million for EMS and US$4 million for interconnect materials.
  • As of March 31, 2016, total unused credit lines amounted to NT$173,204 million.
  • Current ratio was 1.25 and net debt to equity ratio was 0.41 as of March 31, 2016.
  • Total number of employees was 63,357 as of March 31, 2016, compared to 65,789 as of December 31, 2015.

BUSINESS REVIEW

Packaging Operations[3]

  • Gross margin for our packaging operations during the quarter was 19.1%, down by 4.4 percentage points from 4Q15.
  • Capital expenditures for our packaging operations amounted to US$62 million during the quarter, of which US$30 million were used for purchases of wafer bumping and flip chip packaging equipment and US$28 million for common equipment purchases, including SiP equipment purchases, and US$4 million for wirebond packaging specific purposes.

[3] IC packaging services include module assembly services.

Testing Operations

  • Depreciation, amortization and rental expense associated with our testing operations amounted to NT$1,681 million during the quarter, up from NT$1,676 million in 4Q15.
  • In 1Q16, gross margin for our testing operations was 32.9%, down by 4.7 percentage point from the previous quarter.
  • Capital expenditures for our testing operations amounted to US$47 million during the quarter

EMS Operations

  • In 1Q16, gross margin for our EMS operations was 8.1%, up by 0.8 percentage points from the previous quarter.
  • Capital expenditures for our EMS operations amounted to US$2 million during the quarter.

Substrate Operations

  • PBGA substrate manufactured by ASE amounted to NT$2,270 million during the quarter, up by NT$289 million, or by 15% from 4Q15. Of the total output of NT$2,270 million, NT$892 million was from sales to external customers.
  • Gross margin for substrate operations was 16.9% during the quarter, up by 3.9 percentage points from 4Q15.
  • In 1Q16, our internal substrate manufacturing operations supplied 31% (by value) of our total substrate requirements.

Customers

IC ATM CONSOLIDATED BASIS

  • Our five largest customers together accounted for approximately 35% of our total net revenues in 1Q16, compared to 37% in 4Q15. One customer accounted for more than 10% of our total net revenues in 1Q16.
  • Our top 10 customers contributed 51% of our total net revenues during the quarter, compared to 54% in 4Q15.
  • Our customers that are integrated device manufacturers, or IDMs, accounted for 35% of our total net revenues during the quarter, compared to 33% in 4Q15.

EMS BASIS

  • Our five largest customers together accounted for approximately 77% of our total net revenues in 1Q16, compared to 85% in 4Q15. One customer accounted for more than 10% of our total net revenues in 1Q16.
  • Our top 10 customers contributed 89% of our total net revenues during the quarter, compared to 92% in 4Q15.

OUTLOOK

Based on our current business outlook and exchange rate assumptions, management projects overall performance for the second quarter of 2016 to be as follows:

  • IC ATM business will approach 4Q15 levels, driven by a moderate recovery while SiP business remains seasonally soft;
  • IC ATM gross margin should see meaningful improvement from 1Q16, but could be a bit lower than 4Q15;
  • EMS business should decline moderately on a quarter over quarter basis;
  • EMS gross margin should be similar with 1Q16 levels.

About ASE, Inc.

ASE, Inc. is the world's largest independent provider of packaging services and testing services, including front-end engineering testing, wafer probing and final testing services.  With advanced technological capabilities and a global presence spanning Taiwan, China, Korea, Japan, Singapore, Malaysia and the United States, ASE, Inc. 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, including statements regarding our future results of operations and business prospects.  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. Our actual results of operations, financial condition or business prospects may differ materially from those expressed or implied in these forward-looking statements for a variety of reasons, including 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 global economic crisis; 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 our 2014 Annual Report on Form 20-F filed on March 18, 2015.

Supplemental Financial Information

IC ATM Consolidated Operations

Amounts in NT$ Millions

1Q/16

4Q/15

1Q/15

Net Revenues

35,543

38,406

38,605

Revenues by Application




Communication

51%

55%

55%

Computer

12%

12%

11%

Automotive, Consumer & Others

37%

33%

34%

Packaging Operations

Amounts in NT$ Millions             

1Q/16

4Q/15

1Q/15

Net Revenues

28,597

31,121

31,546

Revenues by Packaging Type




Advanced Packaging

29%

33%

33%

IC Wirebonding

62%

58%

58%

Discrete and Others

9%

9%

9%

Capacity




CapEx (US$ Millions)*

62

64

67

Number of Wirebonders

15,629

15,568

15,772

Testing Operations

Amounts in NT$ Millions           

1Q/16     

4Q/15     

1Q/15     

Net Revenues

5,995

6,356

6,180

Revenues by Testing Type




Final test

78%

77%

74%

Wafer sort

18%

19%

21%

Engineering test

4%

4%

5%

Capacity




CapEx (US$ Millions)*

47

18

52

Number of Testers

3,453

3,435

3,339

EMS Operations

Amounts in NT$ Millions          

1Q/16     

4Q/15

1Q/15

Net Revenues

24,788

39,347

28,344

Revenues by End Application




Communication

51%

64%

47%

Computer

19%

15%

17%

Consumer

15%

11%

18%

Industrial

7%

5%

11%

Automotive

7%

4%

6%

Others

1%

1%

1%

Capacity




CapEx (US$ Millions)*

2

5

16

* Capital expenditure excludes building construction costs.

Advanced Semiconductor Engineering, Inc.

Summary of Consolidated Statement of Comprehensive Income Data

(In NT$ millions, except per share data)

(Unaudited)


For the three months ended



Mar. 31

2016


Dec. 31

2015


Mar. 31

2015


Net revenues:







Packaging

28,036


29,093


29,321


Testing

5,995


6,356


6,180


Direct Material

892


798


861


EMS

24,749


39,301


28,300


Others

2,699


-


-


Total net revenues

62,371


75,548


64,662









Cost of revenues

(50,922)


(62,279)


(52,349)


Gross profit

11,449


13,269


12,313









Operating expenses:







Research and development

(2,608)


(2,814)


(2,547)


Selling, general and administrative

(3,635)


(3,654)


(3,474)


Total operating expenses

(6,243)


(6,468)


(6,021)


Operating income

5,206


6,801


6,292









Net non-operating (expenses) income:







Interest expense - net

(527)


(538)


(526)


Foreign exchange gain (loss)

881


428


540


Gain (loss) on valuation of financial assets

 and liabilities

 

(360)


 

(722)


 

(969)


Gain (loss) on equity-method investments

385


424


4


Others

71


179


165


Total non-operating income (expenses)

450


(229)


(786)


Income before tax

5,656


6,572


5,506









Income tax expense

(1,318)


(1,260)


(856)


Income from continuing operations and

before noncontrolling interest

4,338


5,312


4,650


Noncontrolling interest

(175)


(322)


(181)









Net income attributable to

shareholders of the parent

 

4,163


 

4,990


 

4,469









Per share data:







Earnings (losses) per share







– Basic

NT$0.54


NT$0.65


NT$0.58


– Diluted

  NT$0.43


  NT$0.63


  NT$0.56









Earnings (losses) per equivalent ADS







– Basic

 US$0.082


 US$0.100


 US$0.092


– Diluted

 US$0.065


 US$0.097


 US$0.089









Number of weighted average shares used in

diluted EPS calculation (in thousands)

8,293,277


7,840,049


7,868,151









Exchange rate (NT$ per US$1)

33.07


32.55


31.52










Advanced Semiconductor Engineering, Inc.

Summary of Consolidated Statement of Comprehensive Income Data – IC ATM

(In NT$ millions, except per share data)

(Unaudited)


For the three months ended



Mar. 31

2016


Dec. 31

2015


Mar. 31

2015


Net revenues:







Packaging

28,597


31,121


31,546


Testing

5,995


6,356


6,180


Direct Material

931


910


861


Others

20


19


18


Total net revenues

35,543


38,406


38,605









Cost of revenues

(27,711)


(28,429)


(28,610)


Gross profit

7,832


9,977


9,995









Operating expenses:







Research and development

(1,922)


(2,081)


(1,909)


Selling, general and administrative

(2,688)


(2,583)


(2,540)


Total operating expenses

(4,610)


(4,664)


(4,449)


Operating income

3,222


5,313


5,546









Net non-operating (expenses) income:







Interest expense - net

(604)


(584)


(530)


Foreign exchange gain (loss)

834


364


532


Gain (loss) on valuation of financial assets and liabilities

 

(261)


 

(622)


 

(1,129)


Gain (loss) on equity-method investments

1,431


1,333


616


Others

124


336


195


Total non-operating income (expenses)

1,524


827


(316)


Income before tax

4,746


6,140


5,230









Income tax expense

(529)


(1,099)


(709)


Income from continuing operations and

before noncontrolling interest

4,217


5,041


4,521


Noncontrolling interest

(54)


(51)


(52)









Net income attributable to

shareholders of the parent

 

4,163


 

4,990


 

4,469









Advanced Semiconductor Engineering, Inc.

Summary of Consolidated Statement of Comprehensive Income Data – EMS

(In NT$ millions, except per share data)

(Unaudited)


For the three months ended



Mar. 31

2016


Dec. 31

2015


Mar. 31

2015


Net revenues:







Total net revenues

24,788


39,347


28,344









Cost of revenues

(22,781)


(36,473)


(26,079)


Gross profit

2,007


2,874


2,265









Operating expenses:







Research and development

(710)


(760)


(661)


Selling, general and administrative

(920)


(1,038)


(914)


Total operating expenses

(1,630)


(1,798)


(1,575)


Operating income

377


1,076


690









Net non-operating (expenses) income:







Total non-operating income (expenses)

78


(64)


216


Income before tax

455


1,012


906









Income tax expense

(81)


(170)


(156)


Income from continuing operations and

before noncontrolling interest

374


842


750


Noncontrolling interest

(108)


(269)


(130)









Net income attributable to

shareholders of the parent

 

266


 

573


 

620


 

Advanced Semiconductor Engineering, Inc.

Summary of Consolidated Balance Sheet Data

(In NT$ millions)

(Unaudited)



As of Mar. 31, 2016


 

As of Dec. 31, 2015










Current assets:








Cash and cash equivalents



45,070



55,251


Financial assets – current



3,971



3,864


Notes and accounts receivable



40,528



44,931


Inventories



44,224



48,972


Others



3,210



3,715


Total current assets



137,003

 



156,733

 










Financial assets – non current & Investments – equity method



 

51,985



 

38,347


Property plant and equipment



147,234



149,997


Intangible assets



11,861



11,889


Prepaid lease payments



2,458



2,556


Others



5,949



5,766


Total assets



356,490



365,288










Current liabilities:








Short-term borrowings and short-term bills payable



34,154



36,983


Current portion of bonds payable



14,482



14,686


Current portion of long-term borrowings & capital lease obligations



 

1,356



 

2,157


Notes and accounts payable



28,907



34,139


Others



30,530



32,537


Total current liabilities



109,429

 



120,502

 










Bonds payable



32,582



23,740


Long-term borrowings & capital lease obligations



36,089



42,795


Other liabilities



9,653



9,831


Total liabilities



187,753

 



196,868

 


Shareholders of the parent



158,016



156,916










Noncontrolling interest



10,721



11,504


Total liabilities & shareholders' equity



356,490



365,288


















Current Ratio



1.25



1.30


Net Debt to Equity



0.41



0.36










 

IR Contact:

Michelle Jao, Manager
mjao@iselabs.com
Tel: +1.510.687.2481
http://www.aseglobal.com

Grace Teng, Manager
grace_teng@aseglobal.com
Tel: +886.2.6636.5678


 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/advanced-semiconductor-engineering-inc-reports-unaudited-consolidated-financial-results-for-the-first-quarter-of-2016-300259976.html

SOURCE Advanced Semiconductor Engineering, Inc.

Copyright 2016 PR Newswire

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