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 October 26, 2015, 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 October 26, 2015, which is furnished (not filed) herewith. |
News Release |
• | Net sales $734 million |
• | Gross margin 17.2% |
• | Net income $28 million |
• | Earnings per diluted share $0.12 |
GAAP Results | |||||
Q3 2015 | Q2 2015 | Q3 2014 | |||
($ in millions, except per share data) | |||||
Net sales | $734 | $737 | $813 | ||
Gross margin | 17.2% | 15.6% | 18.8% | ||
Net income* | $28 | $10 | $47 | ||
Earnings per diluted share* | $0.12 | $0.04 | $0.20 |
• | Net sales of $660 million to $710 million, down 3% to 10% from the prior quarter |
• | Gross margin of 13% to 17% |
• | Net loss of $4 million to net income of $12 million, or ($0.02) to $0.05 per share |
Q3 2015 | Q2 2015 | Q3 2014 | ||||||||||||
Net Sales Data: | ||||||||||||||
Net sales (in millions): | ||||||||||||||
Advanced products* | $ | 365 | $ | 362 | $ | 411 | ||||||||
Mainstream products** | 369 | 375 | 402 | |||||||||||
Total net sales | $ | 734 | $ | 737 | $ | 813 | ||||||||
Packaging services | 85 | % | 85 | % | 86 | % | ||||||||
Test services | 15 | % | 15 | % | 14 | % | ||||||||
Net sales from top ten customers | 61 | % | 62 | % | 60 | % | ||||||||
Packaged units (in millions): | ||||||||||||||
Advanced products* | 1,305 | 1,275 | 1,012 | |||||||||||
Mainstream products** | 2,750 | 2,703 | 3,545 | |||||||||||
Total packaged units | 4,055 | 3,978 | 4,557 | |||||||||||
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) | 55 | % | 56 | % | 56 | % | ||||||||
Automotive, industrial and other (infotainment, safety, performance, comfort) | 13 | % | 12 | % | 11 | % | ||||||||
Consumer (televisions, set top boxes, gaming, portable media, digital cameras) | 12 | % | 12 | % | 13 | % | ||||||||
Networking (servers, routers, switches) | 12 | % | 11 | % | 11 | % | ||||||||
Computing (PCs, hard disk drives, printers, peripherals, servers) | 8 | % | 9 | % | 9 | % | ||||||||
Total | 100 | % | 100 | % | 100 | % | ||||||||
Gross Margin Data: | ||||||||||||||
Net sales | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||
Cost of sales: | ||||||||||||||
Materials | 36.8 | % | 37.2 | % | 37.5 | % | ||||||||
Labor | 14.9 | % | 15.7 | % | 14.1 | % | ||||||||
Other manufacturing | 31.1 | % | 31.5 | % | 29.6 | % | ||||||||
Gross margin | 17.2 | % | 15.6 | % | 18.8 | % | ||||||||
Earnings per Share Data: | ||||||||||||||
Net income attributable to Amkor common stockholders - basic and diluted | $ | 28 | $ | 10 | $ | 47 | ||||||||
Weighted average shares outstanding - basic | 237 | 237 | 236 | |||||||||||
Effect of dilutive securities: | ||||||||||||||
Stock options and restricted share awards | — | — | 1 | |||||||||||
Weighted average shares outstanding - diluted | 237 | 237 | 237 | |||||||||||
Net income attributable to Amkor per common share: | ||||||||||||||
Basic | $ | 0.12 | $ | 0.04 | $ | 0.20 | ||||||||
Diluted | $ | 0.12 | $ | 0.04 | $ | 0.20 |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
(In thousands, except per share data) | |||||||||||||||
Net sales | $ | 734,362 | $ | 812,824 | $ | 2,213,959 | $ | 2,276,327 | |||||||
Cost of sales | 607,762 | 659,607 | 1,837,314 | 1,843,576 | |||||||||||
Gross profit | 126,600 | 153,217 | 376,645 | 432,751 | |||||||||||
Selling, general and administrative | 54,232 | 61,600 | 173,609 | 191,698 | |||||||||||
Research and development | 21,073 | 16,437 | 59,119 | 59,561 | |||||||||||
Total operating expenses | 75,305 | 78,037 | 232,728 | 251,259 | |||||||||||
Operating income | 51,295 | 75,180 | 143,917 | 181,492 | |||||||||||
Interest expense | 17,695 | 23,780 | 64,317 | 70,039 | |||||||||||
Interest expense, related party | 1,243 | 1,243 | 3,727 | 3,727 | |||||||||||
Other (income) expense, net | (11,576 | ) | (9,626 | ) | (4,784 | ) | (15,289 | ) | |||||||
Total other expense, net | 7,362 | 15,397 | 63,260 | 58,477 | |||||||||||
Income before taxes and equity in earnings of unconsolidated affiliate | 43,933 | 59,783 | 80,657 | 123,015 | |||||||||||
Income tax expense | 16,568 | 14,985 | 27,198 | 32,425 | |||||||||||
Income before equity in earnings of unconsolidated affiliate | 27,365 | 44,798 | 53,459 | 90,590 | |||||||||||
Equity in earnings of J-Devices | 1,656 | 3,372 | 15,460 | 29,169 | |||||||||||
Net income | 29,021 | 48,170 | 68,919 | 119,759 | |||||||||||
Net income attributable to noncontrolling interests | (847 | ) | (1,073 | ) | (2,386 | ) | (2,508 | ) | |||||||
Net income attributable to Amkor | $ | 28,174 | $ | 47,097 | $ | 66,533 | $ | 117,251 | |||||||
Net income attributable to Amkor per common share: | |||||||||||||||
Basic | $ | 0.12 | $ | 0.20 | $ | 0.28 | $ | 0.51 | |||||||
Diluted | $ | 0.12 | $ | 0.20 | $ | 0.28 | $ | 0.50 | |||||||
Shares used in computing per common share amounts: | |||||||||||||||
Basic | 236,888 | 236,337 | 236,813 | 228,733 | |||||||||||
Diluted | 236,974 | 237,509 | 237,168 | 236,672 |
September 30, 2015 | December 31, 2014 | ||||||
(In thousands) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 430,444 | $ | 449,946 | |||
Restricted cash | 2,000 | 2,681 | |||||
Accounts receivable, net of allowances | 410,256 | 469,683 | |||||
Inventories | 208,213 | 223,379 | |||||
Other current assets | 53,858 | 52,259 | |||||
Total current assets | 1,104,771 | 1,197,948 | |||||
Property, plant and equipment, net | 2,284,901 | 2,206,476 | |||||
Investments | 146,639 | 117,733 | |||||
Restricted cash | 2,163 | 2,123 | |||||
Other assets | 109,014 | 111,125 | |||||
Total assets | $ | 3,647,488 | $ | 3,635,405 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Short-term borrowings and current portion of long-term debt | $ | — | $ | 5,000 | |||
Trade accounts payable | 279,260 | 309,025 | |||||
Capital expenditures payable | 221,281 | 127,568 | |||||
Accrued expenses | 251,650 | 258,997 | |||||
Total current liabilities | 752,191 | 700,590 | |||||
Long-term debt | 1,365,376 | 1,450,824 | |||||
Long-term debt, related party | 75,000 | 75,000 | |||||
Pension and severance obligations | 149,952 | 152,673 | |||||
Other non-current liabilities | 101,564 | 125,382 | |||||
Total liabilities | 2,444,083 | 2,504,469 | |||||
Amkor stockholders’ equity: | |||||||
Preferred stock | — | — | |||||
Common stock | 283 | 282 | |||||
Additional paid-in capital | 1,882,529 | 1,878,810 | |||||
Accumulated deficit | (450,429 | ) | (516,962 | ) | |||
Accumulated other comprehensive loss | (32,366 | ) | (32,867 | ) | |||
Treasury stock | (213,576 | ) | (213,028 | ) | |||
Total Amkor stockholders’ equity | 1,186,441 | 1,116,235 | |||||
Noncontrolling interests in subsidiaries | 16,964 | 14,701 | |||||
Total equity | 1,203,405 | 1,130,936 | |||||
Total liabilities and equity | $ | 3,647,488 | $ | 3,635,405 |
For the Nine Months Ended September 30, | |||||||
2015 | 2014 | ||||||
(In thousands) | |||||||
Cash flows from operating activities: | |||||||
Net income | $ | 68,919 | $ | 119,759 | |||
Depreciation and amortization | 371,968 | 340,089 | |||||
Loss on debt retirement | 2,530 | — | |||||
Gain on sale of subsidiary to J-Devices | — | (9,155 | ) | ||||
Other operating activities and non-cash items | (14,752 | ) | (27,811 | ) | |||
Changes in assets and liabilities | (5,299 | ) | (17,214 | ) | |||
Net cash provided by operating activities | 423,366 | 405,668 | |||||
Cash flows from investing activities: | |||||||
Payments for property, plant and equipment | (352,644 | ) | (442,308 | ) | |||
Proceeds from sale of property, plant and equipment | 5,212 | 2,170 | |||||
Cash received (transferred) on sale of subsidiary to J-Devices, net | 8,355 | (15,774 | ) | ||||
Investment in J-Devices | (12,908 | ) | — | ||||
Other investing activities | (869 | ) | (389 | ) | |||
Net cash used in investing activities | (352,854 | ) | (456,301 | ) | |||
Cash flows from financing activities: | |||||||
Borrowings under revolving credit facilities | 180,000 | — | |||||
Payments under revolving credit facilities | (100,000 | ) | — | ||||
Proceeds from issuance of long-term debt | 360,000 | 80,000 | |||||
Payments of long-term debt | (530,000 | ) | (140,000 | ) | |||
Payment of deferred consideration for an acquisition | — | (18,763 | ) | ||||
Proceeds from the issuance of stock through share-based compensation plans | 657 | 5,826 | |||||
Payments of tax withholding for restricted shares | (548 | ) | (1,348 | ) | |||
Payments of subsidiary dividends to noncontrolling interests | (123 | ) | — | ||||
Net cash used in financing activities | (90,014 | ) | (74,285 | ) | |||
Effect of exchange rate fluctuations on cash and cash equivalents | — | 68 | |||||
Net decrease in cash and cash equivalents | (19,502 | ) | (124,850 | ) | |||
Cash and cash equivalents, beginning of period | 449,946 | 610,442 | |||||
Cash and cash equivalents, end of period | $ | 430,444 | $ | 485,592 |
• | there can be no assurance that our new factory and research and development center in Korea will be completed, 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; |
• | the negative impact on economic growth resulting from the action or inaction of the U.S. government relating to federal income tax increases for individuals or corporations, the federal debt ceiling, the federal deficit and government spending restrictions or shutdowns; |
• | 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 additions; |
• | the effects of an economic slowdown in China, the U.S. and other major economies worldwide; |
• | disruptions in our business or deficiencies in our controls resulting from the integration of newly acquired operations 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, natural disasters and military conflict; |
• | 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; |
• | dependence on key personnel; |
• | enforcement of and compliance with intellectual property rights; |
• | environmental and other governmental regulations; and |
• | technological challenges. |