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ASE Technology Holding Co., Ltd. Reports Unaudited Consolidated Financial Results for the Second Quarter of 2021

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TAIPEI, Taiwan, R.O.C., July 29, 2021 /PRNewswire/ -- ASE Technology Holding Co., Ltd. (TAIEX: 3711, NYSE: ASX) ("We", "ASEH", or the "Company"), the leading provider of semiconductor manufacturing services in assembly and test, today reported unaudited net revenues[1] of NT$126,926 million for 2Q21, up by 18% year-over-year and up by 6% sequentially. Net income attributable to shareholders of the parent for the quarter totaled NT$10,338 million, up from a net income attributable to shareholders of the parent of NT$6,937 million in 2Q20 and up from a net income attributable to shareholders of the parent of NT$8,477 million in 1Q21. Basic earnings per share for the quarter were NT$2.40 (or US$0.171 per ADS), compared to NT$1.63 for 2Q20 and NT$1.97 for 1Q21. Diluted earnings per share for the quarter were NT$2.30 (or US$0.164 per ADS), compared to NT$1.60 for 2Q20 and NT$1.92 for 1Q21. We have completed the identification of the difference between the cost of the investment and our share of the net fair value of Asteelflash's identifiable assets and liabilities in 2Q21; therefore, we retrospectively adjusted the amounts for 1Q21. Such adjustments included an increase of NT$397 million to total assets, an increase of NT$507 million to total liabilities and a decrease of NT$110 million to shareholders' equity as of March 31, 2021. The revaluation resulted in an increase of NT$119 million to inventory cost, depreciation, amortization, income tax benefit and non-controlling interest for 1Q21.

RESULTS OF OPERATIONS

2Q21 Results Highlights – Consolidated

  • Net revenue contribution from packaging operations, testing operations, EMS operations and others, each represented approximately 51%, 9%, 39% and 1%, respectively, of total net revenues for the quarter.

  • Cost of revenue was NT$102,122 million for the quarter, up from NT$97,584 million in 1Q21.

  • Gross margin increased 1.2 percentage points to 19.5% in 2Q21 from 18.3% in 1Q21.

  • Operating margin was 10.4% in 2Q21, compared to 9.1% in 1Q21.

  • In terms of non-operating items:

  • Income before tax was NT$13,344 million for 2Q21, compared to NT$11,180 million in 1Q21. We recorded income tax expenses of NT$2,648 million for the quarter, compared to NT$2,451 million in 1Q21.

  • In 2Q21, net income attributable to shareholders of the parent was NT$10,338 million, compared to NT$6,937 million in 2Q20 and NT$8,477 million in 1Q21.

  • Our total number of shares outstanding at the end of the quarter was 4,382,932,382, including treasury stock owned by our subsidiaries. Our 2Q21 basic earnings per share of NT$2.40 (or US$0.171 per ADS) were based on 4,309,821,394 weighted average numbers of shares outstanding in 2Q21. Our 2Q21 diluted earnings per share of NT$2.30 (or US$0.164 per ADS) were based on 4,362,634,153 weighted average number of shares outstanding in 2Q21.

2Q21 Results Highlights – ATM[2]

  • Cost of revenues was NT$58,778 million for the quarter, up by 5% sequentially.

  • Gross margin increased 1.2 percentage points to 25.6% in 2Q21 from 24.4% in 1Q21.

  • Operating margin was 15.0% in 2Q21, compared to 13.4% in 1Q21.

2Q21 Results Highlights – EMS

  • Cost of revenues for the quarter was NT$44,678 million, up by 2% sequentially.

  • Gross margin increased 0.7 percentage points to 9.1% in 2Q21 from 8.4% in 1Q21.

  • Operating margin was 2.6% in 2Q21, compared to 2.5% in 1Q21.

LIQUIDITY AND CAPITAL RESOURCES

  • Capital expenditures in 2Q21 totaled US$611 million, of which US$450 million were used in packaging operations, US$116 million in testing operations, US$39 million in EMS operations and US$6 million in interconnect materials operations and others.

  • As of June 30, 2021, total unused credit lines amounted to NT$276,357 million.

  • Current ratio was 1.30 and net debt to equity ratio was 0.60 as of June 30, 2021.

  • Total number of employees was 103,164 as of June 30, 2021, compared to 101,785 as of March 31, 2021.

BUSINESS REVIEW

Customers
ATM CONSOLIDATED BASIS

  • Our five largest customers together accounted for approximately 43% of our total net revenues in 2Q21, compared to 44% in 1Q21. Two customers each accounted for more than 10% of our total net revenues in 2Q21 individually.

  • Our top 10 customers contributed 55% of our total net revenues both in 2Q21 and 1Q21.

  • Our customers that are integrated device manufacturers or IDMs accounted for 31% of our total net revenues both in 2Q21 and 1Q21.

EMS BASIS

  • Our five largest customers together accounted for approximately 70% of our total net revenues in 2Q21, compared to 73% in 1Q21. One customer accounted for more than 10% of our total net revenues in 2Q21.

  • Our top 10 customers contributed 78% of our total net revenues in 2Q21, compared to 80% in 1Q21.

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 https://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 presentation. 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 presentation. 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 2020 Annual Report on Form 20-F filed on April 6, 2021.

Supplemental Financial Information

Consolidated Operations


2Q/21

1Q/21

2Q/20

EBITDA (NT$ Millions)

27,350

24,867

22,488


ATM Consolidated Operations


2Q/21

1Q/21

2Q/20

Net Revenues (NT$ Millions)

78,988

73,767

69,516

Revenues by Application




Communication

50%

50%

54%

Computing

14%

14%

14%

Automotive, Consumer & Others

36%

36%

32%

Revenues by Type




Bumping, Flip Chip, WLP & SiP

33%

34%

38%

Wirebonding

42%

40%

35%

Discrete and Others

8%

9%

7%

Testing

15%

15%

18%

Material

2%

2%

2%

Capacity & EBITDA




CapEx (US$ Millions)*

570

460

424

EBITDA (NT$ Millions)

24,671

22,566

20,037

Number of Wirebonders

29,056

27,574

24,667

Number of Testers

6,001

5,862

5,790


EMS Operations


2Q/21

1Q/21

2Q/20

Net Revenues (NT$ Millions)

49,154

47,693

39,709

Revenues by End Application




Communication

39%

39%

46%

Computing & Storage

10%

7%

12%

Consumer

28%

33%

28%

Industrial

16%

14%

10%

Automotive

5%

5%

3%

Others

2%

2%

1%

Capacity




CapEx (US$ Millions)*

39

11

70

* 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 six months ended


Jun. 30

2021


Mar. 31

2021[3]


Jun. 30

2020


Jun. 30

2021


Jun. 30

2020

Net revenues:










Packaging

64,149


59,033


53,622


123,182


105,235

Testing

11,676


11,130


12,690


22,806


24,253

EMS

49,147


47,684


39,703


96,831


72,424

Others

1,954


1,623


1,534


3,577


2,994

Total net revenues

126,926


119,470


107,549


246,396


204,906











Cost of revenues

(102,122)


(97,584)


(88,740)


(199,706)


(169,941)

Gross profit

24,804


21,886


18,809


46,690


34,965











Operating expenses:










Research and development

(5,076)


(4,769)


(4,837)


(9,845)


(9,446)

Selling, general and administrative

(6,554)


(6,209)


(5,545)


(12,763)


(11,029)

Total operating expenses

(11,630)


(10,978)


(10,382)


(22,608)


(20,475)

Operating income

13,174


10,908


8,427


24,082


14,490











Net non-operating (expenses) income:










Interest expense - net

(569)


(572)


(771)


(1,141)


(1,664)

Foreign exchange gain (loss)

1,057


(224)


718


833


394

Gain (loss) on valuation of financial assets
and liabilities

(1,050)


391


(17)


(659)


169

Gain (loss) on equity-method investments

219


149


105


368


66

Others

513


528


417


1,041


661

Total non-operating income (expenses)

170


272


452


442


(374)

Income before tax

13,344


11,180


8,879


24,524


14,116











Income tax expense

(2,648)


(2,451)


(1,646)


(5,099)


(2,821)

Income from continuing operations and
before non-controlling interest

10,696


8,729


7,233


19,425


11,295

Non-controlling interest

(358)


(252)


(296)


(610)


(459)











Net income attributable to
shareholders of the parent

10,338


8,477


6,937


18,815


10,836











Per share data:










Earnings (losses) per share










– Basic

NT$2.40


NT$1.97


NT$1.63


NT$4.37


NT$2.54

– Diluted

NT$2.30


NT$1.92


NT$1.60


NT$4.25


NT$2.49











Earnings (losses) per equivalent ADS










– Basic

US$0.171


US$0.139


US$0.109


US$0.310


US$0.170

– Diluted

US$0.164


US$0.135


US$0.107


US$0.302


US$0.166











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

4,362,634


4,357,714


4,273,770


4,363,749


4,279,072











FX (NTD/USD)

28.03


28.30


29.94


28.17


29.97

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 six months ended


Jun. 30

2021


Mar. 31

2021


Jun. 30

2020


Jun. 30

2021


Jun. 30

2020

Net revenues:










Packaging

65,936


61,545


55,732


127,481


109,332

Testing

11,677


11,131


12,693


22,808


24,259

Direct Material

1,372


1,044


1,051


2,416


2,065

Others

3


47


40


50


69

Total net revenues

78,988


73,767


69,516


152,755


135,725











Cost of revenues

(58,778)


(55,760)


(54,434)


(114,538)


(107,309)

Gross profit

20,210


18,007


15,082


38,217


28,416











Operating expenses:










Research and development

(3,829)


(3,697)


(3,777)


(7,526)


(7,425)

Selling, general and administrative

(4,554)


(4,392)


(4,081)


(8,946)


(8,195)

Total operating expenses

(8,383)


(8,089)


(7,858)


(16,472)


(15,620)

Operating income

11,827


9,918


7,224


21,745


12,796











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 six months ended


Jun. 30

2021


Mar. 31

2021[3]


Jun. 30

2020


Jun. 30

2021


Jun. 30

2020

Net revenues:










Total net revenues

49,154


47,693


39,709


96,847


72,436











Cost of revenues

(44,678)


(43,682)


(35,979)


(88,360)


(65,658)

Gross profit

4,476


4,011


3,730


8,487


6,778











Operating expenses:










Research and development

(1,274)


(1,097)


(1,085)


(2,371)


(2,068)

Selling, general and administrative

(1,929)


(1,738)


(1,403)


(3,667)


(2,697)

Total operating expenses

(3,203)


(2,835)


(2,488)


(6,038)


(4,765)

Operating income

1,273


1,176


1,242


2,449


2,013











ASE Technology Holding Co., Ltd.

Summary of Consolidated Balance Sheet Data

(In NT$ millions)

(Unaudited)




As of Jun. 30, 2021


As of Mar. 31, 2021[3]






Current assets:





Cash and cash equivalents


52,987


73,783

Financial assets – current


4,492


5,114

Notes and accounts receivable


88,644


81,726

Inventories


75,869


66,949

Others


15,369


14,629

Total current assets


237,361


242,201






Financial assets – non-current & Investments – equity

method


19,982


19,168

Property plant and equipment


244,861


237,908

Right-of-use assets


9,842


9,067

Intangible assets


78,254


78,810

Others


21,557


19,472

Total assets


611,857


606,626






Current liabilities:





Short-term borrowings


40,460


41,186

Current portion of bonds payable & Current portion of
long-term borrowings


8,563


8,133

Notes and accounts payable


70,893


62,059

Others


62,778


56,472

Total current liabilities


182,694


167,850






Bonds payable


48,474


48,457

Long-term borrowings[4]


106,124


124,247

Other liabilities


20,060


20,078

Total liabilities


357,352


360,632






Equity attributable to shareholders of the parent


238,993


229,671

Non-controlling interests


15,512


16,323

Total liabilities & shareholders' equity


611,857


606,626











Current Ratio


1.30


1.44

Net Debt to Equity Ratio


0.60


0.61

ASE Technology Holding Co., Ltd.

Summary of Consolidated Cash Flow Statements

(In NT$ millions)

(Unaudited)




For the three months ended


For the six months ended



Jun. 30


Mar. 31


Jun. 30


Jun. 30


Jun. 30


2021

2021[3]

2020

2021

2020

Cash Flows from Operating Activities:











Profit before income tax


13,344


11,180


8,879


24,524


14,116

Depreciation & amortization


13,460


13,130


12,785


26,590


25,472

Other operating activities items


(8,573)


(8,559)


(1,659)


(17,132)


(6,135)

Net cash generated from operating
activities


18,231


15,751


20,005


33,982


33,453

Cash Flows from Investing Activities:











Net payments for property, plant
and equipment


(18,440)


(14,053)


(16,587)


(32,493)


(30,192)

Other investment activities items


(1,259)


(205)


1,902


(1,464)


1,697

Net cash used in investing activities


(19,699)


(14,258)


(14,685)


(33,957)


(28,495)

Cash Flows from Financing Activities:











Total net proceeds from
(repayment of) borrowings


(16,640)


19,600


(18,900)


2,960


(5,011)

Other financing activities items


(1,022)


1,613


(457)


591


(262)

Net cash generated from (used in)
financing activities


(17,662)


21,213


(19,357)


3,551


(5,273)

Foreign currency exchange effect


(1,666)


(461)


(1,569)


(2,127)


(1,593)

Net increase (decrease) in cash and
cash equivalents


(20,796)


22,245


(15,606)


1,449


(1,908)

Cash and cash equivalents at the
beginning of period


73,783


51,538


73,829


51,538


60,131

Cash and cash equivalents at the end
of period


52,987


73,783


58,223


52,987


58,223


[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.

[3] We have completed the identification of the difference between the cost of the investment and our share of the net fair value of Asteelflash's identifiable assets and liabilities in 2Q21; therefore, we retrospectively adjusted the amounts for 1Q21. Such adjustments included an increase of NT$397 million to total assets, an increase of NT$507 million to total liabilities and a decrease of NT$110 million to shareholders' equity as of March 31 2021. The revaluation resulted in an increase of NT$119 million to inventory cost, depreciation, amortization, income tax benefit and non-controlling interest for 1Q21.

[4] Long-term borrowings include long-term loans and bills payable.

Investor Relations Contact:
ir@aseglobal.com
Tel: +886.2.6636.5678
http://www.aseglobal.com

Cision
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SOURCE ASE Technology Holding Co., Ltd.