ASE Technology Holding Co., Ltd. Reports Unaudited Consolidated Financial Results for the Fourth Quarter and Full Year of 2020

Taipei, Taiwan, R.O.C., Feb. 4, 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$148,877 million for 4Q20, up by 28% year-over-year and up by 21% sequentially. Net income attributable to shareholders of the parent for the quarter totaled NT$10,044 million, up from a net income attributable to shareholders of the parent of NT$6,383 million in 4Q19 and up from a net income attributable to shareholders of the parent of NT$6,712 million in 3Q20. Basic earnings per share for the quarter were NT$2.35 (or US$0.163 per ADS), compared to basic earnings per share of NT$1.50 for 4Q19 and basic earnings per share of NT$1.57 for 3Q20. Diluted earnings per share for the quarter were NT$2.30 (or US$0.160 per ADS), compared to diluted earnings per share of NT$1.47 for 4Q19 and diluted earnings per share of NT$1.54 for 3Q20.

For the full year of 2020, the Company reported net revenues of NT$476,978 million and net income attributable to shareholders of the parent of NT$27,593 million. Basic earnings per share for the full year of 2020 were NT$6.47 (or US$0.438 per ADS). Diluted earnings per share for the full year of 2020 were NT$6.31 (or US$0.427 per ADS).

RESULTS OF OPERATIONS

4Q20 Results Highlights – Consolidated

  • Net revenue contribution from packaging operations, testing operations, EMS operations and others, each represented approximately 39%, 7%, 53% and 1%, respectively, of total net revenues for the quarter.
  • Cost of revenue was NT$125,578 million for the quarter, up from NT$103,475 million in 3Q20.
    • Raw material cost totaled NT$83,398 million for the quarter, representing 56% of total net revenues.
    • Labor cost totaled NT$14,586 million for the quarter, representing 10% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$11,618 million for the quarter.
  • Gross margin decreased 0.3 percentage points to 15.7% in 4Q20 from 16.0% in 3Q20.
  • Operating margin was 7.6% in 4Q20, compared to 7.4% in 3Q20.
  • In terms of non-operating items:
    • Net interest expense was NT$592 million.
    • Net foreign exchange gain of NT$51 million was primarily attributable to the depreciation of U.S. dollar against New Taiwan dollar.
    • Gain on valuation of financial assets and liabilities was NT$165 million.
    • Net gain on equity-method investments was NT$169 million.
    • Other net non-operating income of NT$1,565 million was primarily attributable to gain on revaluation of disposal subsidiary and miscellaneous income. Total non-operating income for the quarter was NT$1,358 million.
  • Income before tax was NT$12,604 million for 4Q20, compared to NT$9,014 million in 3Q20. We recorded income tax expenses of NT$1,839 million for the quarter, compared to NT$1,797 million in 3Q20.
  • In 4Q20, net income attributable to shareholders of the parent was NT$10,044 million, compared to net income attributable to shareholders of the parent of NT$6,383 million in 4Q19 and net income attributable to shareholders of the parent of NT$6,712 million in 3Q20.
  • Our total number of shares outstanding at the end of the quarter was 4,350,675,482, including treasury stock owned by our subsidiaries. Our 4Q20 basic earnings per share of NT$2.35 (or US$0.163 per ADS) were based on 4,271,639,652 weighted average numbers of shares outstanding in 4Q20. Our 4Q20 diluted earnings per share of NT$2.30 (or US$0.160 per ADS) were based on 4,295,951,077 weighted average number of shares outstanding in 4Q20.

4Q20 Results Highlights – ATM[2]

  • Cost of revenues was NT$56,274 million for the quarter, down by 2% sequentially.
    • Raw material cost totaled NT$18,249 million for the quarter, representing 25% of total net revenues.
    • Labor cost totaled NT$12,641 million for the quarter, representing 17% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$10,808 million for the quarter.
  • Gross margin increased 2.4 percentage points to 22.6% in 4Q20 from 20.2% in 3Q20.
  • Operating margin was 11.0% in 4Q20, compared to 9.5% in 3Q20.

4Q20 Results Highlights – EMS

  • Cost of revenues for the quarter was NT$72,153 million, up by 50% sequentially.
    • Raw material cost totaled NT$64,985 million for the quarter, representing 82% of total net revenues.
    • Labor cost totaled NT$1,852 million for the quarter, representing 2% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$681 million for the quarter.
  • Gross margin decreased 0.9 percentage points to 8.8% in 4Q20 from 9.7% in 3Q20.
  • Operating margin was both 4.4% in 4Q20 and in 3Q20.

2020 Full-Year Results Highlights – Consolidated

  • Net revenues for the full year of 2020 amounted to NT$476,978 million, up by 15% from 2019. The revenue contribution from packaging operations, testing operations, EMS operations and others ,each represented approximately 46%, 10%, 43% and 1%, respectively, of total net revenues for the year.
  • Cost of revenue for the year of 2020 was NT$398,994 million, compared with NT$348,871 million in 2019.
    • Raw material cost totaled NT$240,568 million for the year, representing 50% of total net revenues.
    • Labor cost totaled NT$55,226 million for the year, representing 12% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$46,861 million for the year.
  • Gross margin increased 0.7 percentage points to 16.3% in 2020 from 15.6% in 2019.
  • Operating margin increased to 7.3% in 2020 from 5.7% in 2019.
  • Total non-operating income for the year was NT$857 million, compared to total non-operating expenses of NT$164 million for 2019.
  • Income before tax was NT$35,734 million for 2020. We recognized an income tax expense of NT$6,457 million for the year.
  • In 2020, net income attributable to shareholders of the parent amounted to NT$27,593 million, compared with a net income attributable to shareholders of the parent of NT$16,850 million in 2019.
  • Our total number of shares outstanding at the end of the year was 4,350,675,482, including treasury stock owned by our subsidiaries. Our 2020 basic earnings per share of NT$6.47 (or US$0.438 per ADS) were based on 4,265,732,121 weighted average numbers of shares outstanding in 2019. Our 2020 diluted earnings per share of NT$6.31 (or US$0.427 per ADS) were based on 4,288,633,865 weighted average number of shares outstanding in 2020.

2020 Full-Year Results Highlights – ATM

  • Cost of revenues for the full year of 2020 was NT$220,863 million, compared with NT$201,210 million in 2019.
    • Raw material cost totaled NT$75,768 million for the year, representing 27% of total net revenues.
    • Labor cost totaled NT$48,747 million for the year, representing 17% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$44,126 million for the year.
  • Gross margin increased to 21.2% in 2019 from 19.9% in 2019.
  • Operating margin increased to 9.8% in 2019 from 7.6% in 2019.

2020 Full-Year Results Highlights – EMS

  • Cost of revenues was NT$185,802 million, up by 23% from 2019.
    • Raw material cost totaled NT$164,287 million for the year, representing 80% of total net revenues.
    • Labor cost totaled NT$6,152 million for the year, representing 3% of total net revenues.
    • Depreciation, amortization and rental expenses totaled NT$2,210 million for the year.
  • Gross margin increased to 9.2% in 2020 from 8.8% in 2019.
  • Operating margin increased to 3.8% in 2020 from 2.9% in 2019.

LIQUIDITY AND CAPITAL RESOURCES

  • Capital expenditures in 4Q20 totaled US$379 million, of which US$296 million were used in packaging operations, US$60 million in testing operations, US$19 million in EMS operations and US$4 million in interconnect materials operations and others.
  • For the full year of 2020, we spent US$1,699 million for capital expenditures, including US$1,108 million in packaging operations, US$422 million in testing operations, US$157 million in EMS operations and US$12 million in interconnect materials operations and others.
  • As of December 31, 2020, total unused credit lines amounted to NT$275,181 million.
  • Current ratio was 1.30 and net debt to equity ratio was 0.65 as of December 31, 2020.
  • Total number of employees was 101,981 as of December 31, 2020, compared to 97,259 as of September 30, 2020.

BUSINESS REVIEW

Customers

ATM CONSOLIDATED BASIS

  • Our five largest customers together accounted for approximately 43% of our total net revenues in 4Q20, compared to 48% in 3Q20. Two customers each accounted for more than 10% of our total net revenues in 4Q20 individually.
  • Our top 10 customers contributed 55% of our total net revenues in 4Q20, compared to 60% in 3Q20.
  • Our customers that are integrated device manufacturers or IDMs accounted for 32% of our total net revenues in 4Q20, compared to 30% in 3Q20.

EMS BASIS

  • Our five largest customers together accounted for approximately 86% of our total net revenues in 4Q20, compared to 83% in 3Q20. One customer accounted for more than 10% of our total net revenues in 4Q20.
  • Our top 10 customers contributed 90% of our total net revenues both in 4Q20 and 3Q20.

 

[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.

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 2019 Annual Report on Form 20-F filed on March 31, 2020.

Supplemental Financial Information

Consolidated Operations


4Q/20

3Q/20

4Q/19

EBITDA (NT$ Millions)

26,130

23,230

22,543

ATM Consolidated Operations


4Q/20

3Q/20

4Q/19

Net Revenues (NT$ Millions)

72,752

71,820

69,287

Revenues by Application




Communication

52%

53%

54%

Computing

14%

14%

16%

Automotive, Consumer & Others

34%

33%

30%

Revenues by Type




Bumping, Flip Chip, WLP & SiP

35%

37%

38%

Wirebonding

39%

37%

36%

Discrete and Others

9%

8%

7%

Testing

15%

17%

17%

Material

2%

1%

2%

Capacity & EBITDA




CapEx (US$ Millions)*

359

362

439

EBITDA (NT$ Millions)

21,822

19,775

20,052

Number of Wirebonders

26,461

25,117

25,004

Number of Testers

5,680

5,715

5,402

EMS Operations


4Q/20

3Q/20

4Q/19

Net Revenues (NT$ Millions)

79,149

53,137

48,762

Revenues by End Application




Communication

45%

40%

43%

Computing & Storage

4%

6%

11%

Consumer

39%

40%

32%

Industrial

8%

9%

10%

Automotive

3%

4%

4%

Others

1%

1%

0%

Capacity




CapEx (US$ Millions)*

19

52

18

* 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

2020


Sep. 30

2020


Dec. 31

2019


Dec. 31

2020


Dec. 31

2019


Net revenues:











Packaging

57,260


56,172


53,653


218,667


198,916


Testing

10,667


12,351


11,930


47,271


42,659


EMS

79,141


53,126


48,734


204,691


165,789


Others

1,809


1,546


1,706


6,349


5,818


Total net revenues

148,877


123,195


116,023


476,978


413,182













Cost of revenues

(125,578)


(103,475)


(96,174)


(398,994)


(348,871)


Gross profit

23,299


19,720


19,849


77,984


64,311













Operating expenses:











Research and development

(4,929)


(4,926)


(5,020)


(19,301)


(18,396)


Selling, general and administrative

(7,124)


(5,653)


(6,124)


(23,806)


(22,389)


Total operating expenses

(12,053)


(10,579)


(11,144)


(43,107)


(40,785)


Operating income

11,246


9,141


8,705


34,877


23,526













Net non-operating income (expenses):











Interest expense - net

(592)


(660)


(895)


(2,916)


(3,636)


Foreign exchange gain (loss)

51


561


1,634


1,006


1,126


Gain (loss) on valuation of financial assets 
  and liabilities

 

165


 

(406)


 

(693)


 

(72)


 

1,646


Gain on equity-method investments

169


277


156


512


264


Others

1,565


101


(325)


2,327


436


Total non-operating income (expenses)

1,358


(127)


(123)


857


(164)


Income before tax

12,604


9,014


8,582


35,734


23,362













Income tax expense

(1,839)


(1,797)


(1,779)


(6,457)


(5,309)


Income from continuing operations and
   before non-controlling interest

10,765


7,217


6,803


29,277


18,053


Non-controlling interest

(721)


(505)


(420)


(1,684)


(1,203)













Net income attributable to
   shareholders of the parent

 

10,044


 

6,712


 

6,383


 

27,593


 

16,850













Per share data:











Earnings per share











– Basic

NT$2.35


NT$1.57


NT$1.50


NT$6.47


NT$3.96


– Diluted

NT$2.30


NT$1.54


NT$1.47


NT$6.31


NT$3.86













Earnings per equivalent ADS











– Basic

US$0.163


US$0.107


US$0.098


US$0.438


US$0.257


– Diluted

US$0.160


US$0.105


US$0.096


US$0.427


US$0.250













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

4,295,951


4,281,115


4,284,201


4,288,634


4,262,766













FX (NTD/USD)

28.78


29.46


30.54


29.54


30.88


 

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

2020


Sep. 30

2020


Dec. 31

2019


Dec. 31

2020


Dec. 31

2019


Net revenues:











Packaging

60,825


58,417


56,093


228,574


204,073


Testing

10,667


12,351


11,932


47,277


42,664


Direct Material

1,229


1,020


1,228


4,314


4,283


Others

31


32


34


132


134


Total net revenues

72,752


71,820


69,287


280,297


251,154













Cost of revenues

(56,274)


(57,280)


(53,590)


(220,863)


(201,210)


Gross profit

16,478


14,540


15,697


59,434


49,944













Operating expenses:











Research and development

(3,882)


(3,827)


(4,001)


(15,133)


(14,352)


Selling, general and administrative

(4,594)


(3,904)


(4,330)


(16,692)


(16,592)


Total operating expenses

(8,476)


(7,731)


(8,331)


(31,825)


(30,944)


Operating income

8,002


6,809


7,366


27,609


19,000














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

2020


Sep. 30

2020


Dec. 31

2019


Dec. 31

2020


Dec. 31

2019


Net revenues:











Total net revenues

79,149


53,137


48,762


204,723


165,853













Cost of revenues

(72,153)


(47,990)


(44,443)


(185,802)


(151,234)


Gross profit

6,996


5,147


4,319


18,921


14,619













Operating expenses:











Research and development

(1,073)


(1,126)


(1,063)


(4,267)


(4,170)


Selling, general and administrative

(2,460)


(1,695)


(1,703)


(6,852)


(5,556)


Total operating expenses

(3,533)


(2,821)


(2,766)


(11,119)


(9,726)


Operating income

3,463


2,326


1,553


7,802


4,893













ASE Technology Holding Co., Ltd.

Summary of Consolidated Balance Sheet Data

(In NT$ millions)

(Unaudited)


As of Dec. 31, 2020


As of  Sep. 30, 2020









Current assets:








Cash and cash equivalents



51,538




55,814

Financial assets – current



4,894




5,993

Notes and accounts receivable



91,834




86,718

Inventories



61,988




62,948

Others



14,347




22,167

Total current assets



224,601




233,640









Financial assets – non-current & Investments – equity

  method



 

17,041




 

14,279

Property plant and equipment



233,207




230,938

Right-of-use assets



8,621




8,346

Intangible assets



80,930




76,383

Others



19,460




17,964

Total assets



583,860




581,550









Current liabilities:








Short-term borrowings



34,598




34,099

Current portion of bonds payable & Current portion of 
    long-term borrowings[3]



 

11,220




 

13,708

Notes and accounts payable



73,268




71,515

Others



53,456




56,152

Total current liabilities



172,542




175,474









Bonds payable



49,254




49,249

Long-term borrowings[4]



108,170




122,097

Other liabilities



19,637




17,187

Total liabilities



349,603




364,007









Equity attributable to shareholders of the parent



218,635




205,510

Non-controlling interests



15,622




12,033

Total liabilities & shareholders' equity



583,860




581,550

















Current Ratio



1.30




1.33

Net Debt to Equity Ratio



0.65




0.75

_____________________

[3] Current portion of long-term borrowings include long-term loans and notes payable.

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

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



2020

2020

2019

2020

2019

Cash Flows from Operating Activities:












Profit before income tax


12,604


9,014


8,582


35,734


23,362


Depreciation & amortization


12,764


13,022


12,645


51,259


50,467


Other operating activities items


2,767


(8,550)


10,357


(11,919)


(1,526)


Net cash generated from operating
   activities


28,135


13,486


31,584


75,074


72,303


Cash Flows from Investing Activities:












Net payments for property, plant 
  and equipment


(15,139)


(12,297)


(17,261)


(57,628)


(56,361)


Other investment activities items


(4,859)


(156)


(682)


(3,319)


1,782


Net cash used in investing activities


(19,998)


(12,453)


(17,943)


(60,947)


(54,579)


Cash Flows from Financing Activities:












Total net proceeds from (repayment
  of) debts


(15,686)


12,412


(5,119)


(8,285)


15,741


Dividends paid


-


(8,521)


-


(8,521)


(10,623)


Other financing activities items


989


(5,917)


(7,213)


(5,189)


(11,617)


Net cash used in financing activities


(14,697)


(2,026)


(12,332)


(21,995)


(6,499)


Foreign currency exchange effect


625


243


(2,398)


(725)


(2,612)


Net increase (decrease) in cash
    and cash equivalents


(5,935)


(750)


(1,089)


(8,593)


8,613


Cash and cash equivalents at the
    beginning of period


 

55,814


58,223


61,220


60,131


51,518


Cash and cash equivalents at the
    end of period


49,879


57,473


60,131


51,538


60,131


Cash and cash equivalents in the
    consolidated balance sheet


51,538


55,814


60,131


51,538


60,131


Cash and cash equivalents included in
    disposal groups held for sale


(1,659)


1,659


-


-


-
















 

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.

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