Amkor Technology Reports Financial Results for the Third Quarter

Amkor Technology Reports Financial Results for the Third Quarter 2023

(1) Advanced products include flip chip, memory and wafer-level processing and related test services.
(2) Mainstream products include all other wirebond packaging and related test services.

In this press release, we refer to 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, and our ability to service debt, and our ability to fund capital expenditures and pay dividends. 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:
(in millions)	Q3 2023		Q2 2023		Q3 2022
EBITDA Data:
Net income	$	133	$	64	$	306
Plus: Interest expense		13		14		15
Plus: Income tax expense		29		9		4
Plus: Depreciation & amortization		158		158		156
EBITDA	$	333	$	245	$	481

AMKOR TECHNOLOGY, INC. CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data) (Unaudited)

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2023			2022			2023			2022
Net sales	$	1,821,793		$	2,083,691		$	4,751,254		$	5,185,375
Cost of sales		1,539,040			1,662,463			4,087,210			4,189,662
Gross profit		282,753			421,228			664,044			995,713
Selling, general and administrative		73,020			67,947			216,551			213,774
Research and development		43,135			33,994			135,870			109,835
Total operating expenses		116,155			101,941			352,421			323,609
Operating income		166,598			319,287			311,623			672,104
Interest expense		13,001			14,879			43,522			43,620
Other (income) expense, net		(8,777	)		(5,692	)		(24,212	)		(18,829	)
Total other expense, net		4,224			9,187			19,310			24,791
Income before taxes		162,374			310,100			292,313			647,313
Income tax expense		28,923			3,643			49,194			44,159
Net income		133,451			306,457			243,119			603,154
Net income attributable to non-controlling interests		(837	)		(376	)		(868	)		(1,632	)
Net income attributable to Amkor	$	132,614		$	306,081		$	242,251		$	601,522

Net income attributable to Amkor per common share:
Basic	$	0.54		$	1.25		$	0.99		$	2.46
Diluted	$	0.54		$	1.24		$	0.98		$	2.45

Shares used in computing per common share amounts:
Basic		245,740			244,744			245,571			244,581
Diluted		247,129			246,094			247,080			246,015

AMKOR TECHNOLOGY, INC. CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited)

	September 30, 2023			December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	735,733		$	959,072
Short-term investments		439,002			281,964
Accounts receivable, net of allowances		1,411,393			1,365,504
Inventories		477,935			629,576
Other current assets		61,579			65,123
Total current assets		3,125,642			3,301,239
Property, plant and equipment, net		3,321,467			3,135,614
Operating lease right of use assets		129,515			171,163
Goodwill		18,888			21,517
Restricted cash		3,950			3,334
Other assets		135,387			188,890
Total assets	$	6,734,849		$	6,821,757
LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings and current portion of long-term debt	$	149,890		$	143,813
Trade accounts payable		827,854			899,164
Capital expenditures payable		233,603			146,602
Short-term operating lease liability		43,830			70,991
Accrued expenses		346,913			401,841
Total current liabilities		1,602,090			1,662,411
Long-term debt		947,227			1,088,521
Pension and severance obligations		88,326			93,540
Long-term operating lease liabilities		59,004			75,745
Other non-current liabilities		160,103			201,839
Total liabilities		2,856,750			3,122,056

Stockholders’ equity:
Preferred stock		—			—
Common stock		292			291
Additional paid-in capital		2,005,026			1,996,344
Retained earnings		2,061,596			1,874,644
Accumulated other comprehensive income (loss)		1,839			16,699
Treasury stock		(222,065	)		(219,226	)
Total Amkor stockholders’ equity		3,846,688			3,668,752
Non-controlling interests in subsidiaries		31,411			30,949
Total equity		3,878,099			3,699,701
Total liabilities and equity	$	6,734,849		$	6,821,757

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

	For the Nine Months Ended September 30,
	2023			2022
Cash flows from operating activities:
Net income	$	243,119		$	603,154
Depreciation and amortization		472,396			455,679
Other operating activities and non-cash items		30,717			(20,396	)
Changes in assets and liabilities		(50,045	)		(492,673	)
Net cash provided by operating activities		696,187			545,764
Cash flows from investing activities:
Payments for property, plant and equipment		(511,654	)		(575,502	)
Proceeds from sale of property, plant and equipment		1,580			2,691
Payments for short-term investments		(491,056	)		(364,274	)
Proceeds from sale of short-term investments		71,159			26,202
Proceeds from maturities of short-term investments		267,393			274,452
Other investing activities		(34,319	)		(86,785	)
Net cash used in investing activities		(696,897	)		(723,216	)
Cash flows from financing activities:
Proceeds from revolving credit facilities		370,000			80,000
Payments of revolving credit facilities		(370,000	)		(80,000	)
Proceeds from short-term debt		20,712			29,711
Payments of short-term debt		(14,632	)		(21,662	)
Proceeds from issuance of long-term debt		—			250,000
Payments of long-term debt		(104,952	)		(183,493	)
Payments of finance lease obligations		(48,409	)		(26,938	)
Payments of dividends		(55,328	)		(36,725	)
Other financing activities		(1,801	)		(4,152	)
Net cash (used in) provided by financing activities		(204,410	)		6,741
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash		(17,603	)		(33,491	)
Net decrease in cash, cash equivalents and restricted cash		(222,723	)		(204,202	)
Cash, cash equivalents and restricted cash, beginning of period		962,406			831,521
Cash, cash equivalents and restricted cash, end of period	$	739,683		$	627,319

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