Amkor Technology Reports Financial Results for the First Quarter

Amkor Technology Reports Financial Results for the First Quarter 2018

* Advanced products include flip chip and wafer-level processing and related test services
** Mainstream products include wirebond packaging and related test services

In the press release above we provide EBITDA, which is not defined by U.S. GAAP. We define EBITDA as net income before interest expense, income tax expense and depreciation and amortization. We believe EBITDA to be relevant and useful information to our investors because it provides additional information in assessing our financial operating results. Our management uses EBITDA in evaluating our operating performance, our ability to service debt and our ability to fund capital expenditures. However, EBITDA has certain limitations in that it does not reflect the impact of certain expenses on our consolidated statements of income, including interest expense, which is a necessary element of our costs because we have borrowed money in order to finance our operations, income tax expense, which is a necessary element of our costs because taxes are imposed by law, and depreciation and amortization, which is a necessary element of our costs because we use capital assets to generate income. EBITDA should be considered in addition to, and not as a substitute for, or superior to, operating income, net income or other measures of financial performance prepared in accordance with U.S. GAAP. Furthermore our definition of EBITDA may not be comparable to similarly titled measures reported by other companies. Below is our reconciliation of EBITDA to U.S. GAAP net income.


Non-GAAP Financial Measure Reconciliation:
	Q1 2018		Q4 2017			Q1 2017
	(in millions)
EBITDA Data:
Net income	$	10	$	101		$	(14	)
Plus: Interest expense	20		20			22
Plus: Income tax expense (benefit)	2		(14		)	(1		)
Plus: Depreciation & amortization	143		147			142
EBITDA	$	175	$	254		$	149


AMKOR TECHNOLOGY, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

	For the Three Months Ended March 31,
	2018			2017
	(In thousands, except per share data)
Net sales	$	1,025,319		$	899,284
Cost of sales	867,548			763,050
Gross profit	157,771			136,234
Selling, general and administrative	80,723			76,282
Research and development	40,929			41,568
Total operating expenses	121,652			117,850
Operating income	36,119			18,384
Interest expense	20,011			21,254
Interest expense, related party	—			1,242
Other (income) expense, net	3,432			11,181
Total other expense, net	23,443			33,677
Income (loss) before taxes	12,676			(15,293		)
Income tax expense (benefit)	2,481			(1,325		)
Net income (loss)	10,195			(13,968		)
Net income attributable to non-controlling interests	(651		)	(818		)
Net income (loss) attributable to Amkor	$	9,544		$	(14,786	)

Net income (loss) attributable to Amkor per common share:
Basic	$	0.04		$	(0.06	)
Diluted	$	0.04		$	(0.06	)

Shares used in computing per common share amounts:
Basic	239,214			238,685
Diluted	239,816			238,685


AMKOR TECHNOLOGY, INC. CONSOLIDATED BALANCE SHEETS (Unaudited)

	March 31, 2018			December 31, 2017
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	495,183		$	596,364
Restricted cash	2,000			2,000
Accounts receivable, net of allowances	734,953			798,264
Inventories	228,611			213,649
Other current assets	30,837			33,727
Total current assets	1,491,584			1,644,004
Property, plant and equipment, net	2,727,878			2,695,065
Goodwill	26,546			25,036
Restricted cash	3,661			4,487
Other assets	142,041			139,796
Total assets	$	4,391,710		$	4,508,388
LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings and current portion of long-term debt	$	105,451		$	123,848
Trade accounts payable	527,910			569,085
Capital expenditures payable	223,312			294,258
Accrued expenses	311,408			330,868
Total current liabilities	1,168,081			1,318,059
Long-term debt	1,240,141			1,240,581
Pension and severance obligations	191,180			182,216
Other non-current liabilities	45,234			47,823
Total liabilities	2,644,636			2,788,679

Stockholders’ equity:
Preferred stock	—			—
Common stock	285			285
Additional paid-in capital	1,905,666			1,903,357
Accumulated deficit	(4,359		)	(13,903		)
Accumulated other comprehensive income (loss)	37,571			22,519
Treasury stock	(216,038		)	(215,982		)
Total Amkor stockholders’ equity	1,723,125			1,696,276
Non-controlling interests in subsidiaries	23,949			23,433
Total equity	1,747,074			1,719,709
Total liabilities and equity	$	4,391,710		$	4,508,388


AMKOR TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

	For the Three Months Ended March 31,
	2018			2017
	(In thousands)
Cash flows from operating activities:
Net income (loss)	$	10,195		$	(13,968	)
Depreciation and amortization	142,509			141,816
Other operating activities and non-cash items	(4,734		)	(9,653		)
Changes in assets and liabilities	(339		)	(15,518		)
Net cash provided by operating activities	147,631			102,677
Cash flows from investing activities:
Payments for property, plant and equipment	(230,603		)	(88,285		)
Proceeds from sale of property, plant and equipment	342			1,835
Other investing activities	656			(2,492		)
Net cash used in investing activities	(229,605		)	(88,942		)
Cash flows from financing activities:
Proceeds from short-term debt	—			13,275
Payments of short-term debt	(17,352		)	(14,073		)
Proceeds from issuance of long-term debt	—			50,000
Payments of long-term debt	(6,220		)	(3,295		)
Payment of deferred consideration for purchase of facility	—			(3,890		)
Payments of capital lease obligations	(808		)	(913		)
Other financing activities	455			(356		)
Net cash provided by (used in) financing activities	(23,925		)	40,748
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash	3,892			10,259
Net increase (decrease) in cash, cash equivalents and restricted cash	(102,007		)	64,742
Cash, cash equivalents and restricted cash, beginning of period	602,851			555,495
Cash, cash equivalents and restricted cash, end of period	$	500,844		$	620,237

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