Diodes Incorporated Reports Fourth Quarter and Fiscal 2018

Diodes Incorporated Reports Fourth Quarter and Fiscal 2018 Financial Results


DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except per share data)

	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
		2018			2017			2018			2017
NET SALES	$	314,446		$	268,430		$	1,213,989		$	1,054,204

COST OF GOODS SOLD		200,247			172,051			778,713			697,428

Gross profit		114,199			96,379			435,276			356,776

OPERATING EXPENSES
Selling, general and administrative		44,419			45,678			176,197			168,590
Research and development		21,487			19,662			86,286			77,877
Amortization of acquisition-related intangible assets		4,488			4,700			18,351			18,798
Impairment of fixed assets		-			218			390			2,211
Restructuring		-			4,029			206			10,137
Other operating (income) expense		(55	)		(415	)		(636	)		(246	)
Total operating expenses		70,339			73,872			280,794			277,367

Income from operations		43,860			22,507			154,482			79,409

OTHER INCOME (EXPENSE)
Interest income		547			483			1,978			1,475
Interest expense		(2,282	)		(2,955	)		(9,901	)		(13,448	)
Foreign currency loss, net		(317	)		(1,261	)		(3,701	)		(7,995	)
Other income		1,031			2,022			7,104			3,150
Total other expense		(1,021	)		(1,711	)		(4,520	)		(16,818	)

Income before income taxes and noncontrolling interest		42,839			20,796			149,962			62,591

INCOME TAX PROVISION		12,830			50,674			44,556			62,325

NET INCOME (LOSS)		30,009			(29,878	)		105,406			266

Less: NET INCOME attributable to noncontrolling interest		(490	)		(773	)		(1,385	)		(2,071	)

NET INCOME (LOSS) attributable to common stockholders	$	29,519		$	(30,651	)	$	104,021		$	(1,805	)

EARNINGS (LOSS) PER SHARE attributable to common stockholders
Basic	$	0.59		$	(0.62	)	$	2.09		$	(0.04	)
Diluted	$	0.58		$	(0.62	)	$	2.04		$	(0.04	)

Number of shares used in computation
Basic		50,221			49,391			49,841			48,824
Diluted		50,929			49,391			50,935			48,824

Note: Throughout this release, we refer to “net income attributable to common stockholders” as “net income.”


DIODES INCORPORATED AND SUBSIDIARIES
RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME
(in thousands, except per share data)
(unaudited)

For the three months ended December 31, 2018:

	Operating Expenses	Income Tax Provision		Net Income
Per-GAAP				$	29,519

Diluted earnings per share (Per-GAAP)				$	0.58

Adjustments to reconcile net income to non-GAAP net income:

M&A

Pericom					2,619

Amortization of acquisition-related intangible assets	3,193	(574	)

Others					1,059

Amortization of acquisition-related intangible assets	1,295	(236	)

Non-GAAP				$	33,197

Diluted shares used in computing earnings per share					50,929

Non-GAAP diluted earnings per share				$	0.65

Note: Included in GAAP and non-GAAP net income was approximately $3.8 million, net of tax, non-cash share-based compensation expense. Excluding share-based compensation expense, both GAAP and non-GAAP diluted earnings per share would have improved by $0.07 per share.


DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME – Cont.
(in thousands, except per share data)
(unaudited)

For the three months ended December 31, 2017:

	COGS	Operating Expenses		Income Tax Provision		Net Income
Per-GAAP						$	(30,651	)

Diluted loss per share (Per-GAAP)						$	(0.62	)

Adjustments to reconcile net loss to non-GAAP net income:

M&A

Pericom							2,530

Amortization of acquisition-related intangible assets		3,086		(556	)

KFAB							2,554

Restructuring		4,029		(1,410	)

Impairment of fixed assets	-	(125	)	44

Loss on sale of assets		25		(9	)

Others							47,177

Amortization of acquisition-related intangible assets		1,614		(345	)

Impact of Tax Cuts And Jobs Act				45,908

Non-GAAP						$	21,610

Diluted shares used in computing earnings per share							50,926

Non-GAAP diluted earnings per share						$	0.42

Note: Included in GAAP and non-GAAP adjusted net income was approximately $3.0 million, net of tax, non-cash share-based compensation expense. Excluding share-based compensation expense, both GAAP and non-GAAP adjusted diluted earnings per share would have improved by $0.06 per share.


DIODES INCORPORATED AND SUBSIDIARIES
RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME
(in thousands, except per share data)
(unaudited)

For the twelve months ended December 31, 2018:

	Operating Expenses	Income Tax Provision		Net Income
Per-GAAP				$	104,021

Diluted earnings per share (Per-GAAP)				$	2.04

Adjustments to reconcile net income to non-GAAP net income:

M&A

Pericom					10,430

Amortization of acquisition-related intangible assets	12,719	(2,289	)

KFAB					194

Restructuring	206	(12	)

Others					6,616

Amortization of acquisition-related intangible assets	5,632	(1,030	)

Officer retirement	2,550	(536	)

Non-GAAP				$	121,261

Diluted shares used in computing earnings per share					50,935

Non-GAAP diluted earnings per share				$	2.38

Note: Included in GAAP and non-GAAP adjusted net income was approximately $15.0 million, net of tax, non-cash share-based compensation expense, excluding officer severance. Excluding share-based compensation expense, both GAAP and non-GAAP adjusted diluted earnings per share would have improved by $0.29 per share.


DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME – Cont.
(in thousands, except per share data)
(unaudited)

For the twelve months ended December 31, 2017:

	COGS	Operating Expenses	Income Tax Provision		Net Income
Per-GAAP					$	(1,805	)

Diluted Loss per share (Per-GAAP)					$	(0.04	)

Adjustments to reconcile net loss to non-GAAP net income:

M&A

Pericom						10,282

Retention costs		353	(124	)

Amortization of acquisition-related intangible assets		12,260	(2,207	)

KFAB						9,588

Restructuring		10,137	(3,548	)

Shut-down related costs	2,722		(953	)

Impairment of fixed assets		1,868	(654	)

Loss on sale of assets		25	(9	)

Others						51,056

Amortization of acquisition-related intangible assets		6,538	(1,390	)

Impact of Tax Cuts And Jobs Act			45,908

Non-GAAP					$	69,121

Diluted shares used in computing earnings per share						50,340

Non-GAAP diluted earnings per share					$	1.37

Note: Included in GAAP and non-GAAP adjusted net income was approximately $12.1 million, net of tax, non-cash share-based compensation expense. Excluding share-based compensation expense, both GAAP and non-GAAP adjusted diluted earnings per share would have improved by $0.24 per share.

ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE

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