U.S. Markets open in 1 hr 33 mins

Chipmos shares soar on strong 4Q, IPO plans

The Associated Press

Chipmos Technologies Ltd.'s shares jumped Monday after the company reported that its fourth-quarter net income increased and that it plans to spin off a subsidiary into a public company.

The company, based in Taiwan, provides chip testing and assembly services. It plans to list its subsidiary Chipmos Technologies Inc. on the stock market in Taiwan during the second quarter.

Chipmos gave no further details on the subsidiary or its plans for the offering. It also said Monday that it plans to repurchase up to $7.5 million of its shares.

Chairman and CEO S.J. Cheng said the moves reflect management and the board's confidence in the company's financial strength, long-term growth prospects and commitment to increasing shareholder value.

The news came as Chipmos reported that its fourth-quarter net income jumped to $8.7 million, or 30 cents per share, for the quarter that ended Dec. 31. That is compared with $1 million, or 4 cents per share, in the same quarter of the prior year.

Its net revenue increased to $167.6 million from $158.7 million.

Chipmos said it was helped by improved capacity and a shift toward higher-margin opportunities.

The company expects its first-quarter revenue will be 9 to 13 percent lower than the fourth quarter, reflecting a normal seasonal slump. Cheng said that would mark the bottom of the company's revenue for the year and the company expects sequential growth for each quarter in 2013, given anticipated gains in demand and production capacity.

Chipmos expects its 2013 revenue will be higher than the $661.6 million in revenue it delivered in 2012.

Chipmos' shares jumped 74 cents, more than 7 percent, to $11.15 in high volume U.S. trading on the news. They have traded between $8.25 and $19.37 in the past 52 weeks.