PR Newswire | Oct 28, 2021 02:45AM EDT

Results for the Third Quarter of 2021

10/28 01:45 CDT

ASE Technology Holding Co., Ltd. Reports Unaudited Consolidated Financial Results for the Third Quarter of 2021 TAIPEI, Taiwan, R.O.C., Oct. 28, 2021

TAIPEI, Taiwan, R.O.C., Oct. 28, 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$150,665 million for 3Q21, up by 22% year-over-year and up by 19% sequentially. Net income attributable to shareholders of the parent for the quarter totaled NT$14,176 million, up from a net income attributable to shareholders of the parent of NT$6,712 million in 3Q20 and up from a net income attributable to shareholders of the parent of NT$10,338 million in 2Q21. Basic earnings per share for the quarter were NT$3.29 (or US$0.236 per ADS), compared to NT$1.57 for 3Q20 and NT$2.40 for 2Q21. Diluted earnings per share for the quarter were NT$3.20 (or US$0.230 per ADS), compared to NT$1.54 for 3Q20 and NT$2.30 for 2Q21.

RESULTS OF OPERATIONS

3Q21 Results Highlights - Consolidated

* Net revenue contribution from packaging operations, testing operations, EMS operations and others, each represented approximately 49%, 9%, 41% and 1%, respectively, of total net revenues for the quarter. * Cost of revenue was NT$119,881 million for the quarter, up from NT$102,122 million in 2Q21.

- Raw material cost totaled NT$73,552 million for the quarter, representing 49% of total net revenues.- Labor cost totaled NT$16,955 million for the quarter, representing 11% of total net revenues. - Depreciation, amortization and rental expenses totaled NT$12,710 million for the quarter.

* Gross margin increased 0.9 percentage points to 20.4% in 3Q21 from 19.5% in 2Q21. * Operating margin was 12.2% in 3Q21, compared to 10.4% in 2Q21. * In terms of non-operating items:

- Net interest expense was NT$562 million.- Net foreign exchange gain of NT$66 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$349 million.- Net gain on equity-method investments was NT$414 million.- Other net non-operating income of NT$479 million was primarily attributable to miscellaneous income. Total non-operating income for the quarter was NT$48 million.

* Income before tax was NT$18,474 million for 3Q21, compared to NT$13,344 million in 2Q21. We recorded income tax expenses of NT$3,630 million for the quarter, compared to NT$2,648 million in 2Q21. * In 3Q21, net income attributable to shareholders of the parent was NT$14,176 million, compared to NT$6,712 million in 3Q20 and NT$10,338 million in 2Q21. * Our total number of shares outstanding at the end of the quarter was 4,388,414,582, including treasury stock owned by our subsidiaries. Our 3Q21 basic earnings per share of NT$3.29 (or US$0.236 per ADS) were based on 4,314,088,250 weighted average numbers of shares outstanding in 3Q21. Our 3Q21 diluted earnings per share of NT$3.20 (or US$0.230 per ADS) were based on 4,370,715,418 weighted average number of shares outstanding in 3Q21.

3Q21 Results Highlights - ATM[2]

* Cost of revenues was NT$65,378 million for the quarter, up by 11% sequentially.

- Raw material cost totaled NT$24,441 million for the quarter, representing 27% of total net revenues.- Labor cost totaled NT$14,512 million for the quarter, representing 16% of total net revenues.- Depreciation, amortization and rental expenses totaled NT$11,615 million for the quarter.

* Gross margin increased 1.8 percentage points to 27.4% in 3Q21 from 25.6% in 2Q21. * Operating margin was 17.3% in 3Q21, compared to 15.0% in 2Q21.

3Q21 Results Highlights - EMS

* Cost of revenues for the quarter was NT$55,244 million, up by 24% sequentially.

- Raw material cost totaled NT$48,978 million for the quarter, representing 80% of total net revenues.- Labor cost totaled NT$2,337 million for the quarter, representing 4% of total net revenues.- Depreciation, amortization and rental expenses totaled NT$886 million for the quarter.

* Gross margin increased 0.5 percentage points to 9.6% in 3Q21 from 9.1% in 2Q21. * Operating margin was 4.3% in 3Q21, compared to 2.6% in 2Q21.

LIQUIDITY AND CAPITAL RESOURCES

* Capital expenditures in 3Q21 totaled US$468 million, of which US$294 million were used in packaging operations, US$101 million in testing operations, US$60 million in EMS operations and US$13 million in interconnect materials operations and others. * As of September 30, 2021, total unused credit lines amounted to NT$261,539 million. * Current ratio was 1.35 and net debt to equity ratio was 0.71 as of September 30, 2021. * Total number of employees was 104,471 as of September 30, 2021, compared to 103,164 as of June 30, 2021.

Business Review

Customers

ATM CONSOLIDATED BASIS

* Our five largest customers together accounted for approximately 44% of our total net revenues in 3Q21, compared to 43% in 2Q21. Two customers each accounted for more than 10% of our total net revenues in 3Q21 individually. * Our top 10 customers contributed 55% of our total net revenues both in 3Q21 and 2Q21. * Our customers that are integrated device manufacturers or IDMs accounted for 31% of our total net revenues both in 3Q21 and 2Q21.

EMS BASIS

* Our five largest customers together accounted for approximately 74% of our total net revenues in 3Q21, compared to 70% in 2Q21. One customer accounted for more than 10% of our total net revenues in 3Q21. * Our top 10 customers contributed 81% of our total net revenues in 3Q21, compared to 78% in 2Q21.

About ASE Technology Holding Co., Ltd.

ASEH isthe 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, breakthroughinnovations, 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 moreinformation, 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

3Q/21 2Q/21 3Q/20

EBITDA (NT$ Millions)32,65527,35023,230

ATM Consolidated Operations

3Q/21 2Q/21 3Q/20

Net Revenues (NT$ Millions) 90,09278,98871,820

Revenues by Application

Communication 51% 50% 53%

Computing 15% 14% 14%

Automotive, Consumer & Others34% 36% 33%

Revenues by Type

Bumping, Flip Chip, WLP & SiP36% 33% 37%

Wirebonding 39% 42% 37%

Discrete and Others 8% 8% 8%

Testing 15% 15% 17%

Material 2% 2% 1%

Capacity & EBITDA

CapEx (US$ Millions)* 407 570 362

EBITDA (NT$ Millions) 28,58824,67119,775

Number of Wirebonders 29,94329,05625,117

Number of Testers 6,149 6,001 5,715

EMS Operations

3Q/21 2Q/21 3Q/20

Net Revenues (NT$ Millions)61,12749,15453,137

Revenues by End Application

Communication 38% 39% 40%

Computing & Storage 10% 10% 6%

Consumer 33% 28% 40%

Industrial 12% 16% 9%

Automotive 5% 5% 4%

Others 2% 2% 1%

Capacity

CapEx (US$ Millions)* 60 39 52

*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 nine months ended

Sep. 30 Jun. 30 Sep. 30 Sep. 30 Sep. 30 2021 2021 2020 2021 2020

Net revenues:

Packaging 73,996 64,149 56,172 197,178 161,407

Testing 13,416 11,676 12,351 36,222 36,604

EMS 61,116 49,147 53,126 157,947 125,550

Others 2,137 1,954 1,546 5,714 4,540

Total net revenues 150,665 126,926 123,195 397,061 328,101



Cost of revenues (119,881)(102,122)(103,475)(319,586)(273,416)

Gross profit 30,784 24,804 19,720 77,475 54,685



Operating expenses:

Research and (5,495) (5,076) (4,926) (15,340) (14,372) development

Selling, general and (6,863) (6,554) (5,653) (19,626) (16,682) administrative

Total operating (12,358) (11,630) (10,579) (34,966) (31,054) expenses

Operating income 18,426 13,174 9,141 42,509 23,631



Net non-operating (expenses) income:

Interest expense - net(562) (569) (660) (1,703) (2,324)

Foreign exchange gain 66 1,057 561 899 955 (loss)

Gain (loss) on (349) (1,050) (1,008) valuation of financial (406) (237) assets and liabilities

Gain (loss) on equity-method 414 219 277 782 343 investments

Others 479 513 101 1,520 762

Total non-operating 48 170 (127) 490 (501) income (expenses)

Income before tax 18,474 13,344 9,014 42,999 23,130



Income tax expense (3,630) (2,648) (1,797) (8,729) (4,618)

Income from continuing operations and 14,844 10,696 7,217 34,270 18,512 before non-controlling interest

Non-controlling (668) (358) (505) (1,278) (964) interest



Net income attributable to shareholders of the 14,176 10,338 6,712 32,992 17,548 parent



Per share data:

Earnings (losses) per share

- Basic NT$3.29 NT$2.40 NT$1.57 NT$7.66 NT$4.12

- Diluted NT$3.20 NT$2.30 NT$1.54 NT$7.43 NT$4.01



Earnings (losses) per equivalent ADS

- Basic US$0.236 US$0.171 US$0.107 US$0.546 US$0.276

- Diluted US$0.230 US$0.164 US$0.105 US$0.530 US$0.269



Number of weighted average shares used in 4,370,7154,362,6344,281,1154,370,3124,284,010diluted EPS calculation (in thousands)



FX (NTD/USD) 27.79 28.03 29.46 28.04 29.80

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 nine months ended

Sep. 30 Jun. 30 Sep. 30 Sep. 30 Sep. 30 2021 2021 2020 2021 2020

Net revenues:

Packaging 75,221 65,936 58,417 202,702 167,749

Testing 13,416 11,677 12,351 36,224 36,610

Direct Material 1,429 1,372 1,020 3,845 3,085

Others 26 3 32 76 101

Total net revenues 90,092 78,988 71,820 242,847 207,545



Cost of revenues (65,378)(58,778)(57,280)(179,916)(164,589)

Gross profit 24,714 20,210 14,540 62,931 42,956



Operating expenses:

Research and development (4,254) (3,829) (3,827) (11,780) (11,252)

Selling, general and (4,829) (4,554) (3,904) (13,775) (12,099) administrative

Total operating expenses (9,083) (8,383) (7,731) (25,555) (23,351)

Operating income 15,631 11,827 6,809 37,376 19,605



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 nine months ended

Sep. 30 Jun. 30 Sep. 30 Sep. 30 Sep. 30 2021 2021 2020 2021 2020

Net revenues:

Total net revenues 61,127 49,154 53,137 157,974 125,573



Cost of revenues (55,244)(44,678)(47,990)(143,604)(113,648)

Gross profit 5,883 4,476 5,147 14,370 11,925



Operating expenses:

Research and development (1,270) (1,274) (1,126) (3,641) (3,194)

Selling, general and (1,955) (1,929) (1,695) (5,622) (4,392) administrative

Total operating expenses (3,225) (3,203) (2,821) (9,263) (7,586)

Operating income 2,658 1,273 2,326 5,107 4,339



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

As of Sep. As of Jun. 30, 2021 30, 2021



Current assets:

Cash and cash equivalents 53,419 52,987

Financial assets - current 4,133 4,492

Notes and accounts receivable 108,156 88,644

Inventories 77,830 75,869

Others 16,695 15,369

Total current assets 260,233 237,361



Financial assets - non-current & Investments - equity 20,915 19,982 method

Property plant and equipment 252,384 244,861

Right-of-use assets 10,321 9,842

Intangible assets 77,283 78,254

Others 29,331 21,557

Total assets 650,467 611,857



Current liabilities:

Short-term borrowings 36,610 40,460

Current portion of bonds payable & Current 6,539 8,563 portion of long-term borrowings

Notes and accounts payable 83,060 70,893

Others 66,417 62,778

Total current liabilities 192,626 182,694



Bonds payable 48,498 48,474

Long-term borrowings[3] 137,015 106,124

Other liabilities 21,489 20,060

Total liabilities 399,628 357,352



Equity attributable to shareholders of the 235,186 238,993 parent

Non-controlling interests 15,653 15,512

Total liabilities & shareholders' equity 650,467 611,857





Current Ratio 1.35 1.30

Net Debt to Equity Ratio 0.71 0.60

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

For the three months ended For the nine months ended

Sep. 30 Jun. 30 Sep. 30 Sep. 30 Sep. 30

2021 2021 2020 2021 2020

Cash Flows from OperatingActivities:

Profit before income tax 18,474 13,344 9,014 42,999 23,130

Depreciation & amortization 13,864 13,460 13,022 40,454 38,495

Other operating activities (17,298) (8,573) (8,550) (34,430) (14,686)items

Net cash generated from 15,040 18,231 13,486 49,023 46,939operating activities

Cash Flows from InvestingActivities:

Net payments for property, (20,294) (18,440) (12,297) (52,787) (42,489)plant and equipment

Other investment activities (348) (1,259) (156) (1,812) 1,540items

Net cash used in investing (20,642) (19,699) (12,453) (54,599) (40,949)activities

Cash Flows from FinancingActivities:

Total net proceeds from 25,319 (16,640) 12,412 28,279 7,401(repayment of) borrowings

Dividends paid (18,083) - (8,521) (18,083) (8,521)

Other financing activities (854) (1,022) (5,917) (263) (6,178)items

Net cash generated from(used in) financing 6,382 (17,662) (2,026) 9,933 (7,298)activities

Foreign currency exchange (348) (1,666) 243 (2,476) (1,350)effect

Net increase (decrease) in 432 (20,796) (750) 1,881 (2,658)cash and cash equivalents

Cash and cash equivalents at 52,987 73,783 58,223 51,538 60,131the beginning of period

Cash and cash equivalents at 53,419 52,987 57,473 53,419 57,473the end of period

Cash and cash equivalents inthe consolidated balance 53,419 52,987 55,814 53,419 55,814sheet

Cash and cash equivalentsincluded in disposal groups - - 1,659 - 1,659held for sale

[1] All financial information presented in this press release is unaudited,consolidated and prepared in accordance with Taiwan-IFRS (InternationalFinancial Reporting Standards as endorsed for use in the R.O.C.). Suchfinancial information is generated internally by us and has not been subjectedto the same review and scrutiny, including internal auditing procedures andaudit by our independent auditors, to which we subject our audited consolidatedfinancial statements, and may vary materially from the audited consolidatedfinancial information for the same period. Any evaluation of the financialinformation presented in this press release should also take into account ourpublished audited consolidated financial statements and the notes to thosestatements. In addition, the financial information presented is notnecessarily indicative of our results of operations for any future period.

[2] ATM stands for Semiconductor Assembly, Testing and Material.

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

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

View original content: https://www.prnewswire.com/news-releases/ase-technology-holding-co-ltd-reports-unaudited-consolidated-financial-results-for-the-third-quarter-of-2021-301410615.html

SOURCE ASE Technology Holding Co., Ltd.