TAIPEI, Feb. 7, 2020 /PRNewswire/ -- ASE Technology Holding Co., Ltd. (TAIEX: 3711, NYSE: ASX) ("We", "ASEH", or the "Company") was established following the completion of the merger between Advanced Semiconductor Engineering, Inc. ("ASE") and Siliconware Precision Industries Co., Ltd. on April 30, 2018. ASE is the Company's predecessor entity; therefore, the financial results of the Company for periods before merger are prepared under the assumption that the Company owned 100% shareholdings of ASE at the very beginning. The financial results before April 30, 2018 reflect the operations of ASE and its subsidiaries prior to the establishment of the Company. The financial results after April 30, 2018 reflect combined operations following the completion of the merger. As a result, the Company's financial results of annual period may not be comparable. ASEH, the leading provider of semiconductor manufacturing services in assembly and test, today reported unaudited net revenues[1] of NT$116,023 million for 4Q19, up by 2% year-over-year and down by 1% sequentially. Net income attributable to shareholders of the parent for the quarter totaled NT$6,383 million, up from a net income attributable to shareholders of the parent of NT$5,446 million in 4Q18 and up from a net income attributable to shareholders of the parent of NT$5,734 million in 3Q19. Basic earnings per share for the quarter were NT$1.50 (or US$0.098 per ADS), compared to basic earnings per share of NT$1.28 for 4Q18 and basic earnings per share of NT$1.35 for 3Q19. Diluted earnings per share for the quarter were NT$1.47 (or US$0.096 per ADS), compared to diluted earnings per share of NT$1.24 for 4Q18 and diluted earnings per share of NT$1.33 for 3Q19.

For the full year of 2019, the Company reported net revenues of NT$413,182 million and net income attributable to shareholders of the parent of NT$16,850 million.  Basic earnings per share for the full year of 2019 were NT$3.96 (or US$0.257 per ADS). Diluted earnings per share for the full year of 2019 were NT$3.86 (or US$0.250 per ADS).

RESULTS OF OPERATIONS

4Q19 Results Highlights – Consolidated

  • Net revenue contribution from packaging operations, testing operations, EMS operations and others, each represented approximately 46%, 10%, 42% and 2%, respectively, of total net revenues for the quarter.
  • Cost of revenue was NT$96,174 million for the quarter, down from NT$98,449 million in 3Q19.
    • Raw material cost totaled NT$58,101 million for the quarter, representing 50% of total net revenues.
    • Labor cost totaled NT$13,535 million for the quarter, representing 12% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$11,642 million for the quarter.
  • Gross margin increased 0.8 percentage points to 17.1% in 4Q19 from 16.3% in 3Q19.
  • Operating margin was 7.5% in 4Q19 compared to 7.1% in 3Q19.
  • In terms of non-operating items:
    • Net interest expense was NT$895 million.
    • Net foreign exchange gain of NT$1,634 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$693 million.
    • Net gain on equity-method investments was NT$156 million.
    • Other net non-operating expenses of NT$325 million were primarily attributable to miscellaneous expenses. Total non-operating expenses for the quarter were NT$123 million.
  • Income before tax was NT$8,582 million for 4Q19, compared to NT$7,721 million in 3Q19. We recorded income tax expenses of NT$1,779 million for the quarter, compared to NT$1,501 million in 3Q19.
  • In 4Q19, net income attributable to shareholders of the parent was NT$6,383 million, compared to net income attributable to shareholders of the parent of NT$5,446 million in 4Q18 and net income attributable to shareholders of the parent of NT$5,734 million in 3Q19.
  • Our total number of shares outstanding at the end of the quarter was 4,329,883,632, including treasury stock owned by our subsidiaries. Our 4Q19 basic earnings per share of NT$1.50 (or US$0.098 per ADS) were based on 4,255,172,625 weighted average numbers of shares outstanding in 4Q19. Our 4Q19 diluted earnings per share of NT$1.47 (or US$0.096 per ADS) were based on 4,284,201,158 weighted average number of shares outstanding in 4Q19.

4Q19 Results Highlights – ATM[2]

  • Cost of revenues was NT$53,590 million for the quarter, up by 1% sequentially.
    • Raw material cost totaled NT$18,734 million for the quarter, representing 27% of total net revenues.
    • Labor cost totaled NT$11,934 million for the quarter, representing 17% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$10,990 million for the quarter.
  • Gross margin increased 1.0 percentage points to 22.7% in 4Q19 from 21.7% in 3Q19.
  • Operating margin was 10.6% in 4Q19 compared to 9.4% in 3Q19.

4Q19 Results Highlights – EMS

  • Cost of revenues for the quarter was NT$44,443 million, cost of revenues percentage remained the same as 3Q19.
    • Raw material cost totaled NT$ 39,250 million for the quarter, representing 81% of total net revenues.
    • Labor cost totaled NT$1,526 million for the quarter, representing 3% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$511 million for the quarter.
  • Gross margin was 8.9% both in 4Q19 and 3q19.
  • Operating margin decreased to 3.2% in 4Q19 from 4.1% in 3Q19.

2019 Full-Year Results Highlights – Consolidated

  • Net revenues for the full year of 2019 amounted to NT$413,182 million, up by 11% from 2018. The revenue contribution from packaging operations, testing operations, EMS operations and others ,each represented approximately 48%, 10%, 40% and 2%, respectively, of total net revenues for the year.
  • Cost of revenue for the year of 2019 was NT$348,871 million, compared with NT$309,929 million in 2018.
    • Raw material cost totaled NT$203,505 million for the year, representing 49% of total net revenues.
    • Labor cost totaled NT$51,179 million for the year, representing 12% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$46,218 million for the year.
  • Gross margin decreased 0.9 percentage points to 15.6% in 2019 from 16.5% in 2018.
  • Operating margin decreased to 5.7% in 2019 from 7.2% in 2018.
  • Total non-operating expenses for the year was NT$164 million, compared to total non-operating income of NT$5,400 million for 2018.
  • Income before tax was NT$23,362 million for 2019. We recognized an income tax expense of NT$5,309 million for the year.
  • In 2019, net income attributable to shareholders of the parent amounted to NT$16,850 million, compared with a net income attributable to shareholders of the parent of NT$25,262 million in 2018.
  • Our total number of shares outstanding at the end of the year was 4,329,883,632, including treasury stock owned by our subsidiaries. Our 2019 basic earnings per share of NT$3.96 (or US$0.257 per ADS) were based on 4,251,964,317 weighted average numbers of shares outstanding in 2019. Our 2019 diluted earnings per share of NT$3.86 (or US$0.250 per ADS) were based on 4,262,766,456 weighted average number of shares outstanding in 2019.

2019 Full-Year Results Highlights – ATM

  • Cost of revenues for the full year of 2019 was NT$201,210 million, compared with NT$175,274 million in 2018.
    • Raw material cost totaled NT$68,539 million for the year, representing 27% of total net revenues.
    • Labor cost totaled NT$45,187 million for the year, representing 18% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$43,717 million for the year.
  • Gross margin decreased to 19.9% in 2019 from 21.1% in 2018.
  • Operating margin decreased to 7.6% in 2019 from 9.5% in 2018.

2019 Full-Year Results Highlights – EMS

  • Cost of revenues was NT$151,234 million, up by 10% from 2018.
    • Raw material cost totaled NT$134,793 million for the year, representing 81% of total net revenues.
    • Labor cost totaled NT$5,763 million for the year, representing 4% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$1,959 million for the year.
  • Gross margin decreased to 8.8% in 2019 from 9.4% in 2018.
  • Operating margin decreased to 2.9% in 2019 from 3.7% in 2018.

LIQUIdiTY AND CAPITAL RESOURCES

  • Capital expenditures in 4Q19 totaled US$457 million, of which US$227 million were used in packaging operations, US$205 million in testing operations, US$18 million in EMS operations and US$7 million in interconnect materials operations and others.
  • For the full year of 2019, we spent US$1,575 million for capital expenditures, including US$798 million in packaging operations, US$689 million in testing operations, US$69 million in EMS operations and US$19 million in interconnect materials operations and others.
  • As of December 31, 2019, total unused credit lines amounted to NT$225,418 million.
  • Current ratio was 1.33 and net debt to equity ratio was 0.73 as of December 31, 2019.
  • Total number of employees was 96,528 as of December 31, 2019, compared to 94,675 as of September 30, 2019.

BUSINESS REVIEW

Customers

ATM CONSOLIDATED BASIS

  • Our five largest customers together accounted for approximately 47% of our total net revenues in 4Q19, compared to 46% in 3Q19. One customer accounted for more than 10% of our total net revenues in 4Q19.
  • Our top 10 customers contributed 59% of our total net revenues in 4Q19, compared to 58% in 3Q19.
  • Our customers that are integrated device manufacturers or IDMs accounted for 30% of our total net revenues in 4Q19, compared to 33% in 3Q19.

EMS BASIS

  • Our five largest customers together accounted for approximately 80% of our total net revenues in 4Q19, compared to 82% in 3Q19. One customer accounted for more than 10% of our total net revenues in 4Q19.
  • Our top 10 customers contributed 90% of our total net revenues both in 4Q19 and 3Q19.

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 2018 Annual Report on Form 20-F filed on April 26, 2019.

[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.


Supplemental Financial Information

Consolidated Operations


4Q/19

3Q/19

4Q/18

EBITDA (NT$ Millions)

22,543

21,214

21,082

ATM Consolidated Operations


4Q/19

3Q/19

4Q/18

Net Revenues (NT$ Millions)

69,287

67,901

64,120

Revenues by Application




Communication

54%

53%

52%

Computer

16%

14%

14%

Automotive, Consumer & Others

30%

33%

34%

Revenues by Type




Bumping, Flip Chip, WLP & SiP

38%

35%

33%

Wirebonding

36%

37%

39%

Discrete and Others

7%

9%

9%

Testing

17%

17%

17%

Material

2%

2%

2%

Capacity & EBITDA




CapEx (US$ Millions)*

439

413

237

EBITDA (NT$ Millions)

20,052

18,312

18,271

Number of Wirebonders

25,004

25,008

25,172

Number of Testers

5,402

5,254

4,822

EMS Operations


4Q/19

3Q/19

4Q/18

Net Revenues (NT$ Millions)

48,762

50,599

50,745

Revenues by End Application




Communication

43%

36%

32%

Computer & Storage

11%

9%

10%

Consumer

32%

41%

44%

Industrial

10%

9%

10%

Automotive

4%

4%

4%

Others

0%

1%

0%

Capacity 




CapEx (US$ Millions)*

18

23

11

* 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 year ended


Dec. 31

2019


Sep. 30

2019


Dec. 31

2018


Dec. 31

2019


Dec. 31

2018


Net revenues:











Packaging

53,653


53,804


51,149


198,916


178,308


Testing

11,930


11,493


10,919


42,659


35,903


EMS

48,734


50,584


50,736


165,789


151,890


Others

1,706


1,676


1,224


5,818


4,991


Total net revenues

116,023


117,557


114,028


413,182


371,092













Cost of revenues

(96,174)


(98,449)


(95,344)


(348,871)


(309,929)


Gross profit

19,849


19,108


18,684


64,311


61,163













Operating expenses:











Research and development

(5,020)


(4,906)


(4,293)


(18,396)


(14,963)


Selling, general and administrative

(6,124)


(5,817)


(5,818)


(22,389)


(19,552)


Total operating expenses

(11,144)


(10,723)


(10,111)


(40,785)


(34,515)


Operating income

8,705


8,385


8,573


23,526


26,648













Net non-operating (expenses) income:











Interest expense - net

(895)


(866)


(923)


(3,636)


(3,070)


Foreign exchange gain (loss)

1,634


12


(311)


1,126


(1,016)


Gain (loss) on valuation of financial assets and 
   liabilities

 

(693)


 

(19)


 

140


 

1,646


 

1,990


Gain (loss) on equity-method investments

156


148


6


264


(521)


Others

(325)


61


(250)


436


8,017


Total non-operating income (expenses)

(123)


(664)


(1,338)


(164)


5,400


Income before tax

8,582


7,721


7,235


23,362


32,048













Income tax expense

(1,779)


(1,501)


(1,342)


(5,309)


(5,584)


Income from continuing operations and
   before noncontrolling interest

6,803


6,220


5,893


18,053


26,464


Noncontrolling interest

(420)


(486)


(447)


(1,203)


(1,202)













Net income attributable to 
   shareholders of the parent

 

6,383


 

5,734


 

5,446


 

16,850


 

25,262













Per share data:











Earnings (losses) per share











– Basic

  NT$1.50


  NT$1.35


  NT$1.28


  NT$3.96


  NT$5.95


– Diluted

  NT$1.47


  NT$1.33


  NT$1.24


  NT$3.86


  NT$5.84













Earnings (losses) per equivalent ADS











– Basic

US$0.098


US$0.087


US$0.083


US$0.257


US$0.396


– Diluted

US$0.096


US$0.085


US$0.081


US$0.250


US$0.389













Number of weighted average shares used in
   diluted EPS calculation (in thousands)

4,284,201


4,261,515


4,254,978


4,262,766


4,251,129













FX (NTD/USD)

30.54


31.17


30.79


30.88


30.07


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 year ended


Dec. 31

2019


Sep. 30

2019


Dec. 31

2018


Dec. 31

2019


Dec. 31

2018


Net revenues:











Packaging

56,093


55,163


52,068


204,073


181,675


Testing

11,932


11,495


10,920


42,664


35,905


Direct Material

1,228


1,211


1,093


4,283


4,336


Others

34


32


39


134


134


Total net revenues

69,287


67,901


64,120


251,154


222,050













Cost of revenues

(53,590)


(53,193)


(50,158)


(201,210)


(175,274)


Gross profit

15,697


14,708


13,962


49,944


46,776













Operating expenses:











Research and development

(4,001)


(3,894)


(3,349)


(14,352)


(11,141)


Selling, general and administrative

(4,330)


(4,401)


(4,306)


(16,592)


(14,599)


Total operating expenses

(8,331)


(8,295)


(7,655)


(30,944)


(25,740)


Operating income

7,366


6,413


6,307


19,000


21,036














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 year ended


Dec. 31

2019


Sep. 30

2019


Dec. 31

2018


Dec. 31

2019


Dec. 31

2018


Net revenues:











Total net revenues

48,762


50,599


50,745


165,853


151,921













Cost of revenues

(44,443)


(46,105)


(46,135)


(151,234)


(137,580)


Gross profit

4,319


4,494


4,610


14,619


14,341













Operating expenses:











Research and development

(1,063)


(1,042)


(967)


(4,170)


(3,903)


Selling, general and administrative

(1,703)


(1,353)


(1,463)


(5,556)


(4,771)


Total operating expenses

(2,766)


(2,395)


(2,430)


(9,726)


(8,674)


Operating income

1,553


2,099


2,180


4,893


5,667













ASE Technology Holding Co., Ltd.
Summary of Consolidated Balance Sheet Data
(In NT$ millions)
(Unaudited)


As of Dec. 31, 2019


As of Sep. 30, 2019









Current assets:








Cash and cash equivalents



60,131




61,220

Financial assets – current



4,893




6,583

Notes and accounts receivable



78,948




83,743

Inventories



45,301




48,427

Others



12,728




12,472

Total current assets



202,001




212,445









Financial assets – non current & Investments – equity

  method



 

15,663




 

15,076

Property plant and equipment



232,093




226,302

Right-of-use assets



9,792




9,961

Intangible assets



78,567




79,278

Others



18,538




19,916

Total assets



556,654




562,978









Current liabilities:








Short-term borrowings



37,339




70,896

Current portion of long-term borrowings



5,363




10,017

Notes and accounts payable



56,066




56,385

Others



53,497




49,129

Total current liabilities



152,265




186,427









Bonds payable



36,272




27,223

Long-term borrowings



135,966




113,775

Other liabilities



17,804




17,138

Total liabilities



342,307




344,563

Shareholders of the parent



200,969




201,510









Noncontrolling interest



13,378




16,905

Total liabilities & shareholders' equity



556,654




562,978

















Current Ratio



1.33




1.14









Net Debt to Equity



0.73




0.73

ASE Technology Holding Co., Ltd.
Summary of Consolidated Cash Flow Statements
(In NT$ millions)
(Unaudited)



 

For the three months ended


For the year ended




Dec. 31


Sep. 30


Dec. 31


Dec. 31


Dec. 31



2019

2019

2018

2019

2018

Cash Flows from Operating Activities:












Profit before income tax


8,582


7,721


7,235


23,362


32,048


Depreciation & amortization


12,645


12,610


12,220


50,467


42,689


Other operating activities items


10,356


(7,252)


(605)


(1,526)


(23,662)


Net cash generated from operating activities


31,583


13,079


18,850


72,303


51,075


Cash Flows from Investing Activities:












Net payments for property, plant 
   
and equipment


(17,261)


(18,771)


(9,993)


(56,361)


(40,259)


Other investment activities items


(677)


488


(6,230)


1,787


(89,283)


Net cash used in investing activities


(17,938)


(18,283)


(16,223)


(54,574)


(129,542)


Cash Flows from Financing Activities:












Total net proceeds from (repayment of) debts


(5,123)


26,553


(10,523)


15,737


101,653


Dividends paid


0


(10,623)


0


(10,623)


(10,614)


Other financing activities items


(7,247)


(3,356)


3,255


(11,651)


(7,928)


Net cash generated from (used in) financing activities


(12,370)


12,574


(7,268)


(6,537)


83,111


Foreign currency exchange effect


(2,364)


(1,240)


824


(2,579)


796


Net increase (decrease) in cash 
   
and cash equivalents


(1,089)


6,130


(3,817)


8,613


5,440


Cash and cash equivalents at the beginning of period


61,220


55,090


55,335


51,518


46,078


Cash and cash equivalents at the 
   
end of period


60,131


61,220


51,518


60,131


51,518
















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.


Source: ASE Technology Holding Co., Ltd.