ASE Technology Holding Co., Ltd. Reports Unaudited Consolidated Financial Results for the Third Quarter of 2021

Rhea-AI Summary

ASE Technology Holding Co. reported 3Q21 net revenues of NT$150,665 million, marking a 22% year-over-year and 19% sequential increase. Net income for shareholders rose to NT$14,176 million from NT$6,712 million in 3Q20. The basic earnings per share reached NT$3.29, up from NT$1.57 a year earlier. Gross margin improved to 20.4%, and operating margin increased to 12.2%. The company incurred capital expenditures totaling US$468 million, focusing on packaging and testing operations. The top five customers accounted for 44% of total revenues.

Positive

• Net revenues increased by 22% year-over-year.
• Net income attributable to shareholders rose to NT$14,176 million.
• Basic earnings per share improved to NT$3.29.

Negative

• Cost of revenue increased to NT$119,881 million, up from NT$102,122 million in 2Q21.
• Raw material costs constituted 49% of total net revenues.

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 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 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)	32,655	27,350	23,230

ATM Consolidated Operations

	3Q/21	2Q/21	3Q/20
Net Revenues (NT$ Millions)	90,092	78,988	71,820
Revenues by Application
Communication	51%	50%	53%
Computing	15%	14%	14%
Automotive, Consumer & Others	34%	36%	33%
Revenues by Type
Bumping, Flip Chip, WLP & SiP	36%	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)	28,588	24,671	19,775
Number of Wirebonders	29,943	29,056	25,117
Number of Testers	6,149	6,001	5,715

EMS Operations

	3Q/21	2Q/21	3Q/20
Net Revenues (NT$ Millions)	61,127	49,154	53,137
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 2021		Jun. 30 2021		Sep. 30 2020		Sep. 30 2021		Sep. 30 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 development	(5,495)		(5,076)		(4,926)		(15,340)		(14,372)
Selling, general and administrative	(6,863)		(6,554)		(5,653)		(19,626)		(16,682)
Total operating expenses	(12,358)		(11,630)		(10,579)		(34,966)		(31,054)
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 (loss)	66		1,057		561		899		955
Gain (loss) on valuation of financial assets and liabilities	(349)		(1,050)		(406)		(1,008)		(237)
Gain (loss) on equity-method investments	414		219		277		782		343
Others	479		513		101		1,520		762
Total non-operating income (expenses)	48		170		(127)		490		(501)
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 before non-controlling interest	14,844		10,696		7,217		34,270		18,512
Non-controlling interest	(668)		(358)		(505)		(1,278)		(964)
Net income attributable to shareholders of the parent	14,176		10,338		6,712		32,992		17,548
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 diluted EPS calculation (in thousands)	4,370,715		4,362,634		4,281,115		4,370,312		4,284,010
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 2021		Jun. 30 2021		Sep. 30 2020		Sep. 30 2021		Sep. 30 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 administrative	(4,829)		(4,554)		(3,904)		(13,775)		(12,099)
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 2021		Jun. 30 2021		Sep. 30 2020		Sep. 30 2021		Sep. 30 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 administrative	(1,955)		(1,929)		(1,695)		(5,622)		(4,392)
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. 30, 2021						As of  Jun. 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   method			20,915				19,982
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 portion of long-term borrowings			6,539				8,563
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 parent			235,186				238,993
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 Operating Activities:
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 items		(17,298)		(8,573)		(8,550)		(34,430)		(14,686)
Net cash generated from operating activities		15,040		18,231		13,486		49,023		46,939
Cash Flows from Investing Activities:
Net payments for property, plant and equipment		(20,294)		(18,440)		(12,297)		(52,787)		(42,489)
Other investment activities items		(348)		(1,259)		(156)		(1,812)		1,540
Net cash used in investing activities		(20,642)		(19,699)		(12,453)		(54,599)		(40,949)
Cash Flows from Financing Activities:
Total net proceeds from (repayment of) borrowings		25,319		(16,640)		12,412		28,279		7,401
Dividends paid		(18,083)		-		(8,521)		(18,083)		(8,521)
Other financing activities items		(854)		(1,022)		(5,917)		(263)		(6,178)
Net cash generated from (used in) financing activities		6,382		(17,662)		(2,026)		9,933		(7,298)
Foreign currency exchange effect		(348)		(1,666)		243		(2,476)		(1,350)
Net increase (decrease) in cash and cash equivalents		432		(20,796)		(750)		1,881		(2,658)
Cash and cash equivalents at the beginning of period		52,987		73,783		58,223		51,538		60,131
Cash and cash equivalents at the end of period		53,419		52,987		57,473		53,419		57,473
Cash and cash equivalents in the consolidated balance sheet		53,419		52,987		55,814		53,419		55,814
Cash and cash equivalents included in disposal groups held for sale		-		-		1,659		-		1,659

 

[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.

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

 

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.

FAQ

What were ASE Technology Holding's 3Q21 earnings results on the ASX?

ASE Technology reported a net income of NT$14,176 million with basic earnings per share of NT$3.29.

How did ASE Technology's net revenues perform in 3Q21 on the ASX?

Net revenues for ASE Technology in 3Q21 were NT$150,665 million, up 22% year-over-year.

What was the gross margin for ASE Technology in 3Q21 on the ASX?

The gross margin for ASE Technology in 3Q21 increased to 20.4%.

What are the capital expenditures for ASE Technology in 3Q21 on the ASX?

ASE Technology's capital expenditures in 3Q21 totaled US$468 million.