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Amkor Technology Reports Financial Results for the Fourth Quarter and Full Year 2020

Nachrichtenquelle: Business Wire (engl.)
08.02.2021, 22:03  |  137   |   |   

Amkor Technology, Inc. (NASDAQ: AMKR), a leading provider of semiconductor packaging and test services, today announced financial results for the fourth quarter and full year ended December 31, 2020.

“Better than expected demand for smartphone and automotive products drove fourth quarter revenue up 16% year on year to a record $1.37 billion,” said Giel Rutten, Amkor’s president and chief executive officer. “For full year 2020, we delivered record revenue of $5.05 billion, an increase of nearly $1 billion over 2019. Demand for advanced packages, particularly advanced SiP, drove strong growth in the consumer, communications and computing end markets.”

“High utilization drove gross margin over 20%, and operating income margin reached 11.6% in the fourth quarter. The improved profitability and continued spending discipline resulted in record annual EPS of $1.40,” said Megan Faust, Amkor’s executive vice president and chief financial officer. “In 2020, free cash flow doubled from 2019 to a record $221 million. We also further strengthened our balance sheet by lowering our blended borrowing rate and paying down approximately $300 million in debt, ending the year with all-time low net debt of $322 million.”

Results

Q4 2020 (1)

Q3 2020

Q4 2019 (2)

2020 (1)

2019 (3)

 

($ in millions, except per share amounts)

Net sales

$1,371

$1,354

$1,178

$5,051

$4,053

Gross margin

20.3%

17.8%

18.9%

17.8%

16.0%

Operating income

$159

$127

$118

$457

$233

 

 

 

 

 

Net income attributable to Amkor

$127

$92

$99

$338

$121

Earnings per diluted share

$0.52

$0.38

$0.41

$1.40

$0.50

EBITDA (4)

$288

$255

$244

$960

$756

Annual free cash flow (4)

 

 

 

$221

$104

Net debt (4)

 

 

 

$322

$549

(1)

 

Q4 and full year 2020 net income includes a $20 million discrete income tax benefit, or $0.08 per diluted share, primarily related to changes in the valuation of certain deferred tax assets.

(2)

 

Q4 2019 net income includes a $4 million discrete income tax benefit, or $0.01 per diluted share, primarily related to changes in the valuation of certain deferred tax assets.

(3)

 

Full year 2019 net income includes an $8 million charge, or $0.03 per share, related to the early redemption of $525 million of senior notes due 2022 and a net $11 million discrete income tax charge, or $0.05 per diluted share, related to changes in the valuation of certain deferred tax assets.

(4)

 

EBITDA, free cash flow and net debt are non-GAAP measures. The reconciliations to the comparable GAAP measures are included below under “Selected Operating Data.”

At December 31, 2020, total cash and short-term investments was $832 million, and total debt was $1.154 billion.

Business Outlook

“We expect the first quarter to be another strong quarter, with revenue projected to be 15% above the first quarter of 2020, driven by continued recovery in automotive and better than seasonal demand for smartphones,” said Rutten. “We see 2021 as another good growth year for Amkor as 5G deployment, high performance computing, IoT wearables and recovery in automotive are all expected to drive strong demand for our services.”

First quarter 2021 outlook (unless otherwise noted):

  • Net sales of $1.27 billion to $1.37 billion
  • Gross margin of 17% to 20%
  • Net income of $70 million to $118 million, or $0.29 to $0.48 per diluted share
  • Full year 2021 capital expenditures to be around $700 million

Conference Call Information

Amkor will conduct a conference call on Monday, February 8, 2021, at 5:00 p.m. Eastern Time. This call may include material information not included in this press release. This call is being webcast and can be accessed at Amkor’s website: www.amkor.com. You may also access the call by dialing 1-877-407-4019 or 1-201-689-8337. A replay of the call will be made available at Amkor’s website or by dialing 1-877-660-6853 or 1-201-612-7415 (conference ID 13715048). The webcast is also being distributed over NASDAQ OMX’s investor distribution network to both institutional and individual investors. Institutional investors can access the call via NASDAQ OMX’s password-protected event management site, Street Events (www.streetevents.com).

About Amkor

Amkor Technology, Inc. is one of the world’s largest providers of outsourced semiconductor packaging and test services. Founded in 1968, Amkor pioneered the outsourcing of IC packaging and test, and is now a strategic manufacturing partner for the world’s leading semiconductor companies, foundries and electronics OEMs. Amkor’s operational base includes production facilities, product development centers and sales and support offices located in key electronics manufacturing regions in Asia, Europe and the USA. For more information visit www.amkor.com.

AMKOR TECHNOLOGY, INC.

Selected Operating Data

 

 

 

 

 

 

 

 

 

 

 

Q4 2020

 

Q3 2020

 

Q4 2019

 

2020

 

2019

Net Sales Data:

 

 

 

 

 

 

 

 

 

Net sales (in millions):

 

 

 

 

 

 

 

 

 

Advanced products (1)

$

868

 

 

$

899

 

 

$

667

 

 

$

3,202

 

 

$

2,111

 

Mainstream products (2)

503

 

 

455

 

 

511

 

 

1,849

 

 

1,942

 

Total net sales

$

1,371

 

 

$

1,354

 

 

$

1,178

 

 

$

5,051

 

 

$

4,053

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Packaging services

85

%

 

86

%

 

84

%

 

85

%

 

83

%

Test services

15

%

 

14

%

 

16

%

 

15

%

 

17

%

 

 

 

 

 

 

 

 

 

 

Net sales from top ten customers

61

%

 

63

%

 

65

%

 

65

%

 

63

%

 

 

 

 

 

 

 

 

 

 

End Market Distribution Data:

 

 

 

 

 

 

 

 

 

Communications (handheld devices, smartphones, tablets)

46

%

 

43

%

 

37

%

 

41

%

 

38

%

Consumer (connected home, set-top boxes, televisions, visual imaging, wearables)

19

%

 

25

%

 

24

%

 

24

%

 

18

%

Automotive, industrial and other (driver assist, infotainment, performance, safety)

19

%

 

17

%

 

25

%

 

20

%

 

27

%

Computing (datacenter, infrastructure, PC/laptops, storage)

16

%

 

15

%

 

14

%

 

15

%

 

17

%

Total

100

%

 

100

%

 

100

%

 

100

%

 

100

%

 

 

 

 

 

 

 

 

 

 

Gross Margin Data:

 

 

 

 

 

 

 

 

 

Net sales

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

Cost of sales:

 

 

 

 

 

 

 

 

 

Materials

44.6

%

 

46.9

%

 

42.6

%

 

45.5

%

 

40.0

%

Labor

12.9

%

 

12.8

%

 

13.9

%

 

13.4

%

 

16.0

%

Other manufacturing

22.2

%

 

22.5

%

 

24.6

%

 

23.3

%

 

28.0

%

Gross margin

20.3

%

 

17.8

%

 

18.9

%

 

17.8

%

 

16.0

%

 

(1) Advanced products include flip chip and wafer-level processing and related test services

(2) Mainstream products include wirebond packaging and related test services

AMKOR TECHNOLOGY, INC.
Selected Operating Data

In this press release, we refer to EBITDA, which is not defined by U.S. GAAP. We define EBITDA as net income before interest expense, income tax expense and depreciation and amortization. We believe EBITDA to be relevant and useful information to our investors because it provides additional information in assessing our financial operating results. Our management uses EBITDA in evaluating our operating performance, and our ability to service debt, and our ability to fund capital expenditures and pay dividends. However, EBITDA has certain limitations in that it does not reflect the impact of certain expenses on our consolidated statements of income, including interest expense, which is a necessary element of our costs because we have borrowed money in order to finance our operations, income tax expense, which is a necessary element of our costs because taxes are imposed by law, and depreciation and amortization, which is a necessary element of our costs because we use capital assets to generate income. EBITDA should be considered in addition to, and not as a substitute for, or superior to, operating income, net income or other measures of financial performance prepared in accordance with U.S. GAAP. Furthermore our definition of EBITDA may not be comparable to similarly titled measures reported by other companies. Below is our reconciliation of EBITDA to U.S. GAAP net income.

Non-GAAP Financial Measures Reconciliation:

 

 

 

 

 

 

 

 

 

 

Q4 2020

 

Q3 2020

 

Q4 2019

 

2020

 

2019

 

(in millions)

EBITDA Data:

 

 

 

 

 

 

 

 

 

Net income

$

127

 

 

$

93

 

 

$

100

 

 

$

340

 

 

$

123

 

Plus: Interest expense

15

 

 

16

 

 

17

 

 

64

 

 

72

 

Plus: Income tax expense

13

 

 

16

 

 

1

 

 

46

 

 

37

 

Plus: Depreciation & amortization

133

 

 

130

 

 

126

 

 

510

 

 

524

 

EBITDA

$

288

 

 

$

255

 

 

$

244

 

 

$

960

 

 

$

756

 

In this press release, we refer to free cash flow, which is not defined by U.S. GAAP. We define free cash flow as net cash provided by operating activities less payments for property, plant and equipment, plus proceeds from the sale of and insurance recovery for property, plant and equipment, if applicable. We believe free cash flow to be relevant and useful information to our investors because it provides them with additional information in assessing our liquidity, capital resources and financial operating results. Our management uses free cash flow in evaluating our liquidity, and our ability to service debt, and our ability to fund capital expenditures and pay dividends. However, free cash flow has certain limitations, including that it does not represent the residual cash flow available for discretionary expenditures since other, non-discretionary expenditures, such as mandatory debt service, are not deducted from the measure. The amount of mandatory versus discretionary expenditures can vary significantly between periods. This measure should be considered in addition to, and not as a substitute for, or superior to, other measures of liquidity or financial performance prepared in accordance with U.S. GAAP, such as net cash provided by operating activities. Furthermore, our definition of free cash flow may not be comparable to similarly titled measures reported by other companies. Below is our reconciliation of free cash flow to U.S. GAAP net cash provided by operating activities.

Non-GAAP Financial Measures Reconciliation:

 

 

 

 

2020

 

 

2019

 

 

(in millions)

Free Cash Flow Data:

 

 

 

Net cash provided by operating activities

$

770

 

 

 

$

564

 

 

Less: Purchases of property, plant and equipment

(553

)

 

 

(472

)

 

Plus: Proceeds from sale of and insurance recovery for property, plant and equipment

4

 

 

 

12

 

 

Free cash flow

$

221

 

 

 

$

104

 

 

AMKOR TECHNOLOGY, INC.
Selected Operating Data

This press release also includes net debt, which is not defined by U.S. GAAP. We define net debt as total debt as reported on the consolidated balance sheet less the sum of cash and cash equivalents, and short term investments. We believe net debt to be relevant and useful information to our investors because it provides them with additional information in assessing our capital structure, financial leverage, and our ability to reduce debt and to fund investing and financing activities. This measure should be considered in addition to, and not as a substitute for, or superior to, total debt, prepared in accordance with U.S. GAAP. Furthermore, our definition of net debt may not be comparable to similarly titled measures reported by other companies.

Non-GAAP Financial Measure Reconciliation:

 

 

 

 

2020

 

 

2019

 

 

(in millions)

Net Debt Data:

 

 

 

Total Debt

$

1,154

 

 

 

$

1,450

 

 

Less: Cash and Cash Equivalents

(698

)

 

 

(895

)

 

Less: Short-term Investments

(134

)

 

 

(6

)

 

Net Debt

$

322

 

 

 

$

549

 

 

AMKOR TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

 

 

For the Three Months Ended
December 31,

 

For the Year Ended
December 31,

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

(In thousands, except per share data)

Net sales

$

1,371,041

 

 

 

$

1,178,464

 

 

 

$

5,050,589

 

 

 

$

4,052,650

 

 

Cost of sales

1,092,540

 

 

 

955,480

 

 

 

4,149,775

 

 

 

3,403,211

 

 

Gross profit

278,501

 

 

 

222,984

 

 

 

900,814

 

 

 

649,439

 

 

Selling, general and administrative

78,219

 

 

 

71,828

 

 

 

302,842

 

 

 

278,631

 

 

Research and development

41,103

 

 

 

32,771

 

 

 

140,727

 

 

 

137,638

 

 

Total operating expenses

119,322

 

 

 

104,599

 

 

 

443,569

 

 

 

416,269

 

 

Operating income

159,179

 

 

 

118,385

 

 

 

457,245

 

 

 

233,170

 

 

Interest expense

14,707

 

 

 

16,673

 

 

 

64,168

 

 

 

71,587

 

 

Other (income) expense, net

4,828

 

 

 

1,132

 

 

 

6,395

 

 

 

1,773

 

 

Total other expense, net

19,535

 

 

 

17,805

 

 

 

70,563

 

 

 

73,360

 

 

Income before taxes

139,644

 

 

 

100,580

 

 

 

386,682

 

 

 

159,810

 

 

Income tax expense

12,679

 

 

 

764

 

 

 

46,183

 

 

 

37,182

 

 

Net income

126,965

 

 

 

99,816

 

 

 

340,499

 

 

 

122,628

 

 

Net income attributable to noncontrolling interests

(291

)

 

 

(669

)

 

 

(2,361

)

 

 

(1,740

)

 

Net income attributable to Amkor

$

126,674

 

 

 

$

99,147

 

 

 

$

338,138

 

 

 

$

120,888

 

 

 

 

 

 

 

 

 

 

Net income attributable to Amkor per common share:

 

 

 

 

 

 

 

Basic

$

0.52

 

 

 

$

0.41

 

 

 

$

1.40

 

 

 

$

0.50

 

 

Diluted

$

0.52

 

 

 

$

0.41

 

 

 

$

1.40

 

 

 

$

0.50

 

 

Shares used in computing per common share amounts:

 

 

 

 

 

 

 

Basic

242,333

 

 

 

240,384

 

 

 

241,509

 

 

 

239,725

 

 

Diluted

243,356

 

 

 

241,146

 

 

 

242,248

 

 

 

240,122

 

 

AMKOR TECHNOLOGY, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

 

December 31,

 

2020

 

 

2019

 

 

(In thousands)

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

698,002

 

 

 

$

894,948

 

 

Restricted cash

1,007

 

 

 

610

 

 

Short-term investments

133,769

 

 

 

6,348

 

 

Accounts receivable, net of allowances

962,643

 

 

 

850,753

 

 

Inventories

297,293

 

 

 

220,602

 

 

Other current assets

40,218

 

 

 

28,272

 

 

Total current assets

2,132,932

 

 

 

2,001,533

 

 

Property, plant and equipment, net

2,566,002

 

 

 

2,404,850

 

 

Operating lease right of use assets

147,236

 

 

 

148,549

 

 

Goodwill

27,325

 

 

 

25,976

 

 

Restricted cash

3,188

 

 

 

2,974

 

 

Other assets

145,628

 

 

 

111,733

 

 

Total assets

$

5,022,311

 

 

 

$

4,695,615

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

Current liabilities:

 

 

 

Short-term borrowings and current portion of long-term debt

$

149,007

 

 

 

$

144,479

 

 

Trade accounts payable

636,434

 

 

 

571,054

 

 

Capital expenditures payable

181,339

 

 

 

77,044

 

 

Accrued expenses

349,207

 

 

 

267,226

 

 

Total current liabilities

1,315,987

 

 

 

1,059,803

 

 

Long-term debt

1,005,339

 

 

 

1,305,755

 

 

Pension and severance obligations

159,610

 

 

 

176,971

 

 

Long-term operating lease liabilities

84,420

 

 

 

91,107

 

 

Other non-current liabilities

102,996

 

 

 

71,740

 

 

Total liabilities

2,668,352

 

 

 

2,705,376

 

 

 

 

 

 

Amkor stockholders’ equity:

 

 

 

Preferred stock

 

 

 

 

 

Common stock

289

 

 

 

287

 

 

Additional paid-in capital

1,953,378

 

 

 

1,927,739

 

 

Retained earnings

562,502

 

 

 

234,077

 

 

Accumulated other comprehensive income

27,270

 

 

 

19,115

 

 

Treasury stock

(217,740

)

 

 

(217,479

)

 

Total Amkor stockholders’ equity

2,325,699

 

 

 

1,963,739

 

 

Noncontrolling interests in subsidiaries

28,260

 

 

 

26,500

 

 

Total equity

2,353,959

 

 

 

1,990,239

 

 

Total liabilities and equity

$

5,022,311

 

 

 

$

4,695,615

 

 

AMKOR TECHNOLOGY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

For the Year Ended December 31,

 

2020

 

 

2019

 

 

(In thousands)

Cash flows from operating activities:

 

 

 

Net income

$

340,499

 

 

 

$

122,628

 

 

Depreciation and amortization

510,396

 

 

 

524,177

 

 

Other operating activities and non-cash items

12,594

 

 

 

42,935

 

 

Changes in assets and liabilities

(93,456

)

 

 

(125,890

)

 

Net cash provided by operating activities

770,033

 

 

 

563,850

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

Payments for property, plant and equipment

(553,021

)

 

 

(472,433

)

 

Proceeds from sale of property, plant and equipment

3,819

 

 

 

10,117

 

 

Proceeds from insurance recovery for property, plant and equipment

 

 

 

1,538

 

 

Payments for short-term investments

(535,368

)

 

 

(5,935

)

 

Proceeds from sale of short-term investments

247,081

 

 

 

 

 

Proceeds from maturities of short-term investments

159,015

 

 

 

6,469

 

 

Other investing activities

39,769

 

 

 

(2,245

)

 

Net cash used in investing activities

(638,705

)

 

 

(462,489

)

 

 

 

 

 

Cash flows from financing activities:

 

 

 

Proceeds from revolving credit facilities

312,000

 

 

 

272,700

 

 

Payments of revolving credit facilities

(332,000

)

 

 

(272,700

)

 

Proceeds from short-term debt

86,769

 

 

 

51,434

 

 

Payments of short-term debt

(87,353

)

 

 

(52,635

)

 

Proceeds from issuance of long-term debt

331,033

 

 

 

975,575

 

 

Payments of long-term debt

(648,514

)

 

 

(862,927

)

 

Payments of finance lease obligations

(9,851

)

 

 

(6,574

)

 

Other financing activities

14,197

 

 

 

3,377

 

 

Net cash (used in) provided by financing activities

(333,719

)

 

 

108,250

 

 

 

 

 

 

Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash

6,056

 

 

 

870

 

 

 

 

 

 

Net (decrease) increase in cash, cash equivalents and restricted cash

(196,335

)

 

 

210,481

 

 

Cash, cash equivalents and restricted cash, beginning of period

898,532

 

 

 

688,051

 

 

Cash, cash equivalents and restricted cash, end of period

$

702,197

 

 

 

$

898,532

 

 

Forward-Looking Statement Disclaimer

This press release contains forward-looking statements within the meaning of federal securities laws. All statements other than statements of historical fact are considered forward-looking statements, including all of the statements made under “Business Outlook” above. These forward-looking statements involve a number of risks, uncertainties, assumptions and other factors that could affect future results and cause actual results and events to differ materially from historical and expected results and those expressed or implied in the forward-looking statements, including, but not limited to, the following:

  • health conditions or pandemics, such as Covid-19, impacting labor availability and operating capacity, capital availability, the supply chain and consumer demand for our customers’ products and services;
  • dependence on the highly cyclical, volatile semiconductor industry;
  • industry downturns and declines in global economic and financial conditions;
  • fluctuation in demand for semiconductors and conditions in the semiconductor industry generally, as well as by specific customers, such as inventory reductions by our customers impacting demand in key markets;
  • changes in our capacity and capacity utilization rates and fluctuations in our manufacturing yields;
  • changes in costs, quality, availability and delivery times of raw materials, components and equipment, including any disruption in the supply of certain materials due to regulations and customer requirements, as well as production delays, wage inflation, fluctuations in commodity prices and supply constraints;
  • the development, transition and ramp to high volume manufacture of more advanced silicon nodes and evolving wafer, packaging and test technologies may cause production delays, lower manufacturing yields and supply constraints for new wafers and other materials;
  • absence of backlog, the short-term nature of our customers’ commitments, double bookings by customers and deterioration in customer forecasts and the impact of these factors, including the possible delay, rescheduling and cancellation of large orders, or the timing and volume of orders relative to our production capacity;
  • dependence on key customers or concentration of customers in certain end markets, such as mobile communications and automotive;
  • dependence on international factories and operations and risks relating to our customers’ and vendors’ international operations;
  • laws, rules, regulations and policies imposed by U.S. or other governments, such as tariffs, customs, duties and other restrictive trade barriers, national security, data privacy and cybersecurity, antitrust and competition, tax, currency and banking, labor, environmental, health and safety, and in particular the recent increase in tariffs, customs, duties and other restrictive trade barriers considered or adopted by U.S. and other governments;
  • laws, rules, regulations and policies within China and other countries that may favor domestic companies over non-domestic companies, including customer- or government-supported efforts to promote the development and growth of local competitors;
  • fluctuations in currency exchange rates, particularly the dollar/yen exchange rate for our operations in Japan;
  • competition with established competitors in the packaging and test business, the internal capabilities of integrated device manufacturers and new competitors, including foundries;
  • decisions by our integrated device manufacturer and foundry customers to curtail outsourcing;
  • difficulty achieving high capacity utilization rates due to high percentage of fixed costs;
  • our substantial investments in equipment and facilities to support the demand of our customers;
  • there can be no assurance regarding when our factory and research and development center in Korea will be fully utilized, or that the actual scope, costs, timeline or benefits of the project will be consistent with our expectations;
  • the historical downward pressure on the prices of our packaging and test services;
  • any warranty claims, product return and liability risks, and the risk of negative publicity if our products fail, as well as the risk of litigation incident to our business;
  • our substantial indebtedness and restrictive covenants in the indentures and agreements governing our current and future indebtedness;
  • the possibility that we may decrease or suspend our quarterly dividend;
  • difficulty funding our liquidity needs;
  • our significant severance plan obligations associated with our manufacturing operations in Korea;
  • maintaining an effective system of internal controls;
  • difficulty attracting, retaining or replacing qualified personnel;
  • our continuing development and implementation of changes to, and maintenance and security of, our information technology systems;
  • challenges with integrating diverse operations;
  • any changes in tax laws, taxing authorities not agreeing with our interpretation of applicable tax laws, including whether we continue to qualify for tax holidays, or any requirements to establish or adjust valuation allowances on deferred tax assets;
  • our ability to develop new proprietary technology, protect our proprietary technology, operate without infringing the proprietary rights of others and implement new technologies;
  • natural disasters and other calamities, health conditions or pandemics, political instability, hostilities or other disruptions; and
  • the ability of certain of our stockholders to effectively determine or substantially influence the outcome of matters requiring stockholder approval.

Other important risk factors that could affect the outcome of the events set forth in these statements and that could affect our operating results and financial condition are discussed in the company’s Annual Report on Form 10-K for the year ended December 31, 2019 and in the company’s subsequent filings with the Securities and Exchange Commission made prior to or after the date hereof. Amkor undertakes no obligation to review or update any forward-looking statements to reflect events or circumstances occurring after the date of this press release except as may be required by law.

Amkor Technology Aktie jetzt über den Testsieger (Finanztest 11/2020) handeln, ab 0 € auf Smartbroker.de



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Disclaimer

Amkor Technology Reports Financial Results for the Fourth Quarter and Full Year 2020 Amkor Technology, Inc. (NASDAQ: AMKR), a leading provider of semiconductor packaging and test services, today announced financial results for the fourth quarter and full year ended December 31, 2020. “Better than expected demand for smartphone and …

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