Diodes Incorporated Reports Record First Quarter Fiscal 2022 Financial Results
Diodes reported a record revenue of $482.1 million for Q1 2022, marking a 16.7% increase year-over-year. The company achieved a GAAP gross profit of $196.7 million, with a gross margin of 40.8%, up 720 basis points from last year. Net income reached $72.7 million, or $1.59 per share, reflecting an 82.8% improvement year-over-year. Diodes plans to acquire an onsemi wafer fabrication facility, enhancing future growth. The company anticipates revenue around $500 million in Q2 2022.
- Record revenue of $482.1 million, +16.7% YoY and +0.4% QoQ.
- Record gross profit of $196.7 million, +41.9% YoY.
- Record gross margin of 40.8% (+720 basis points YoY).
- Record net income of $72.7 million (+82.8% YoY).
- Record non-GAAP EPS of $1.75 (+88.2% YoY).
- Strengthened customer relationships and design win momentum.
- Proposed acquisition of onsemi facility to increase capacity.
- Net cash flow was negative $60.8 million due to debt repayments and capital expenditures.
- EBITDA decreased from $139.0 million in Q4 2021 to $118.2 million in Q1 2022.
- COVID-related lockdowns in China impacted operational capacity.
Achieves Record Revenue for 6th Consecutive Quarter and Record Gross Margin of
First Quarter Highlights
- Announced the proposed acquisition of the onsemi wafer fabrication facility, which is expected to close in late second quarter of 2022;
-
Revenue was a record
, increasing 16.7 percent from$482.1 million in the first quarter 2021 and 0.4 percent from$413.1 million in the fourth quarter 2021;$480.2 million -
GAAP gross profit was a record
, increasing 41.9 percent from$196.7 million in the first quarter 2021 and 3.1 percent from$138.6 million in the fourth quarter 2021;$190.7 million - GAAP gross profit margin was a record 40.8 percent, an increase of 720 basis points from the 33.6 percent in the first quarter 2021 and 110 basis points from the 39.7 percent in the fourth quarter 2021;
-
GAAP net income was a record
, compared to$72.7 million in the first quarter 2021 and$39.5 million in the fourth quarter 2021;$65.5 million -
Non-GAAP adjusted net income was a record
, compared to$80.3 million in the first quarter 2021 and$42.0 million in the fourth quarter 2021;$73.3 million -
GAAP EPS was a record
per diluted share, an 82.8 percent improvement from the$1.59 per diluted share in the first quarter 2021 and a 11.2 percent increase compared to$0.87 per diluted share in the fourth quarter 2021;$1.43 -
Non-GAAP EPS was a record
per diluted share, an 88.2 percent improvement from the$1.75 per diluted share in the prior year quarter and a 9.4 percent increase from the$0.93 per diluted share last quarter;$1.60 -
Excluding
, net of tax, of non-cash share-based compensation expense, both GAAP and non-GAAP earnings per share would have increased by$6.4 million per diluted share;$0.14 -
EBITDA was
, or 24.5 percent of revenue, compared to$118.2 million , or 19.8 percent of revenue, in the first quarter 2021 and$81.7 million , or 28.9 percent of revenue, in the fourth quarter 2021; and$139.0 million -
Achieved cash flow from operations of
and$72.3 million of free cash flow, including$33.8 million of capital expenditures. Net cash flow was a negative$38.5 , including the pay down of$60.8 million of debt, capital expenditures and a deposit on the proposed acquisition of the onsemi facility.$67.6 million
Commenting on the results, Dr.
“Our strong revenue and margin performance continues to be driven by records achieved in the automotive end market, which reached
“Looking forward, we are well positioned with a global manufacturing footprint, including the proposed addition of the onsemi
First Quarter 2022
Revenue for first quarter 2022 was a record
GAAP gross profit for the first quarter 2022 was a record
GAAP operating expenses for first quarter 2022 were
First quarter 2022 GAAP net income was a record
First quarter 2022 non-GAAP adjusted net income was a record
The following is an unaudited summary reconciliation of GAAP net income to non-GAAP adjusted net income and per share data, net of tax (in thousands, except per share data):
Three Months Ended | |||
GAAP net income | $ |
72,691 |
|
GAAP diluted earnings per share | $ |
1.59 |
|
Adjustments to reconcile net income to non-GAAP net income: | |||
Amortization of acquisition-related intangible assets |
|
3,156 |
|
Acquisition-related costs |
|
218 |
|
Non-cash mark-to-market investment adjustments |
|
4,245 |
|
Non-GAAP net income | $ |
80,310 |
|
Non-GAAP diluted earnings per share | $ |
1.75 |
|
Note: Throughout this release, we refer to “net income attributable to common stockholders” as “net income.”
(See the reconciliation tables of GAAP net income to non-GAAP adjusted net income near the end of this release for further details.)
Included in first quarter 2022 GAAP net income and non-GAAP adjusted net income was approximately
EBITDA (a non-GAAP measure), which represents earnings before net interest expense, income tax, depreciation and amortization, in first quarter 2022 was
For first quarter 2022, net cash provided by operating activities was
Balance Sheet
As of
The results announced today are preliminary and unaudited, as they are subject to the Company finalizing its closing procedures and completion of the quarterly review by its independent registered public accounting firm. As such, these results are subject to revision until the Company files its Form 10-Q for the quarter ending
Business Outlook
Amortization of acquisition-related intangible assets of
Conference Call
Diodes will host a conference call on
Additionally, this conference call will be broadcast live over the Internet and can be accessed by all interested parties on the Investors’ section of Diodes' website at http://www.diodes.com. To listen to the live call, please go to the investors’ section of Diodes’ website and click on the conference call link at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those unable to participate during the live broadcast, a replay will be available shortly after the call on Diodes' website for approximately 90 days.
About
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: Any statements set forth above that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such statements include statements containing forward-looking words such as “expect,” “anticipate,” “aim,” “estimate,” and variations thereof, including without limitation statements, whether direct or implied, regarding expectations of that for the second quarter of 2022, we expect revenue to be approximately
The Diodes logo is a registered trademark of
DIODES INCORPORATED AND SUBSIDIARIES |
||||||||
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS |
||||||||
(unaudited) |
||||||||
(in thousands, except per share data) |
||||||||
Three Months Ended |
||||||||
|
||||||||
2022 |
|
2021 |
||||||
Net sales | $ |
482,123 |
|
$ |
413,121 |
|
||
Cost of goods sold |
|
285,426 |
|
|
274,485 |
|
||
Gross profit |
|
196,697 |
|
|
138,636 |
|
||
Operating expenses | ||||||||
Selling, general and administrative |
|
71,443 |
|
|
58,676 |
|
||
Research and development |
|
28,677 |
|
|
27,659 |
|
||
Amortization of acquisition-related intangible assets |
|
3,862 |
|
|
4,023 |
|
||
Other operating expense |
|
(343 |
) |
|
888 |
|
||
Total operating expense |
|
103,639 |
|
|
91,246 |
|
||
Income from operations |
|
93,058 |
|
|
47,390 |
|
||
Other (expense) income | ||||||||
Interest income |
|
826 |
|
|
768 |
|
||
Interest expense |
|
(1,114 |
) |
|
(2,864 |
) |
||
Foreign currency loss, net |
|
1,721 |
|
|
(1,279 |
) |
||
Unrealized (loss) gain on investments |
|
(5,548 |
) |
|
3,655 |
|
||
Other income |
|
1,876 |
|
|
2,317 |
|
||
Total other (expense) income |
|
(2,239 |
) |
|
2,597 |
|
||
Income before income taxes and noncontrolling interest |
|
90,819 |
|
|
49,987 |
|
||
Income tax provision |
|
16,646 |
|
|
9,434 |
|
||
Net income |
|
74,173 |
|
|
40,553 |
|
||
Less net (income) loss attributable to noncontrolling interest |
|
(1,482 |
) |
|
(1,101 |
) |
||
Net income attributable to common stockholders | $ |
72,691 |
|
$ |
39,452 |
|
||
Earnings per share attributable to common stockholders: | ||||||||
Basic | $ |
1.61 |
|
$ |
0.89 |
|
||
Diluted | $ |
1.59 |
|
$ |
0.87 |
|
||
Number of shares used in earnings per share computation: | ||||||||
Basic |
|
45,104 |
|
|
44,408 |
|
||
Diluted |
|
45,844 |
|
|
45,243 |
|
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 |
||||||||||
Operating Expenses |
Other Income (Expense) |
Income Tax Provision |
Net Income | |||||||
Per-GAAP | $ |
72,691 |
||||||||
Diluted earnings per share (Per-GAAP) |
|
1.59 |
||||||||
Adjustments to reconcile net income to non-GAAP net income: | ||||||||||
Amortization of acquisition-related intangible assets | 3,862 |
(706 |
) |
|
3,156 |
|||||
Acquisition-related costs | 275 |
(57 |
) |
|
218 |
|||||
Non-cash mark-to-market investment adjustments | 5,548 |
(1,303 |
) |
|
4,245 |
|||||
Non-GAAP | $ |
80,310 |
||||||||
Diluted shares used in computing earnings per share |
|
45,844 |
||||||||
Non-GAAP diluted earnings per share | $ |
1.75 |
Note: Included in GAAP and non-GAAP net income was approximately
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 |
||||||||||||||
COGS | Operating Expenses |
Other Income (Expense) |
Income Tax Provision |
Net Income | ||||||||||
Per-GAAP | $ |
39,452 |
|
|||||||||||
Diluted earnings per share (Per-GAAP) |
|
0.87 |
|
|||||||||||
Adjustments to reconcile net income to non-GAAP net income: | ||||||||||||||
Amortization of acquisition-related intangible assets | 4,024 |
(744 |
) |
|
3,280 |
|
||||||||
Acquisition-related costs | 1,908 |
(400 |
) |
|
1,508 |
|
||||||||
Non-cash mark-to-market investment adjustments | (3,655 |
) |
731 |
|
|
(2,924 |
) |
|||||||
Restructuring Cost | 820 |
(123 |
) |
|
697 |
|
||||||||
Non-GAAP | $ |
42,013 |
|
|||||||||||
Diluted shares used in computing earnings per share |
|
45,243 |
|
|||||||||||
Non-GAAP diluted earnings per share | $ |
0.93 |
|
Note: Included in GAAP and non-GAAP adjusted net income was approximately
ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE
The Company’s financial statements present net income and earnings per share that are calculated using accounting principles generally accepted in
Detail of non-GAAP adjustments
Amortization of acquisition-related intangible assets – The Company excluded this item, including amortization of developed technologies and customer relationships. The fair value of the acquisition-related intangible assets is amortized using straight-line methods which approximate the proportion of future cash flows estimated to be generated each period over the estimated useful life of the applicable assets. The Company believes that exclusion of this item is appropriate because a significant portion of the purchase price for its acquisitions was allocated to the intangible assets that have short lives and exclusion of the amortization expense allows comparisons of operating results that are consistent over time for both the Company’s newly acquired and long-held businesses. In addition, the Company excluded this item because there is significant variability and unpredictability among companies with respect to this expense.
Acquisition related costs – The Company excluded expenses associated with the acquisition of
Non-cash mark-to-market investment adjustments – The Company excluded market to market adjustments on various equity related investments, including certain LSC equity investments. The Company believes this is not reflective of the ongoing operations and exclusion of this provides investors an enhanced view of the Company’s operating results.
Restructuring costs – The Company has recorded restructuring charges related to the shutdown and relocation of one of our assembly and test facilities located in
CASH FLOW ITEMS
Free cash flow (FCF) (Non-GAAP)
FCF for the first quarter of 2022 is a non-GAAP financial measure, which is calculated by subtracting capital expenditures from cash flow from operations. For the first quarter of 2022, FCF was
CONSOLIDATED RECONCILIATION OF NET INCOME TO EBITDA
EBITDA represents earnings before net interest expense, income tax provision, depreciation and amortization. Management believes EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties, such as financial institutions in extending credit, in evaluating companies in our industry and provides further clarity on our profitability. In addition, management uses EBITDA, along with other GAAP and non-GAAP measures, in evaluating our operating performance compared to that of other companies in our industry. The calculation of EBITDA generally eliminates the effects of financing, operating in different income tax jurisdictions, and accounting effects of capital spending, including the impact of our asset base, which can differ depending on the book value of assets and the accounting methods used to compute depreciation and amortization expense. EBITDA is not a recognized measurement under GAAP, and when analyzing our operating performance, investors should use EBITDA in addition to, and not as an alternative for, income from operations and net income, each as determined in accordance with GAAP. Because not all companies use identical calculations, our presentation of EBITDA may not be comparable to similarly titled measures used by other companies. For example, our EBITDA takes into account all net interest expense, income tax provision, depreciation and amortization without taking into account any amounts attributable to noncontrolling interest. Furthermore, EBITDA is not intended to be a measure of free cash flow for management’s discretionary use, as it does not consider certain cash requirements such as tax and debt service payments.
The following table provides a reconciliation of net income to EBITDA (in thousands, unaudited):
Three Months Ended |
||||||
|
||||||
2022 |
|
2021 |
||||
Net income (per-GAAP) | $ |
72,691 |
$ |
39,452 |
||
Plus: | ||||||
Interest expense, net |
|
288 |
|
2,096 |
||
Income tax provision |
|
16,646 |
|
9,434 |
||
Depreciation and amortization |
|
28,594 |
|
30,675 |
||
EBITDA (non-GAAP) | $ |
118,219 |
$ |
81,657 |
DIODES INCORPORATED AND SUBSIDIARIES |
||||||||
CONSOLIDATED CONDENSED BALANCE SHEETS |
||||||||
(in thousands) |
||||||||
|
|
|
||||||
2022 |
|
2021 |
||||||
(unaudited) | (audited) | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ |
303,295 |
|
$ |
363,599 |
|
||
Restricted Cash |
|
2,710 |
|
|
3,219 |
|
||
Short-term investments |
|
9,241 |
|
|
6,542 |
|
||
Accounts receivable, net of allowances of |
|
362,035 |
|
|
358,496 |
|
||
Inventories |
|
370,045 |
|
|
348,622 |
|
||
Prepaid expenses and other |
|
104,763 |
|
|
107,194 |
|
||
Total current assets |
|
1,152,089 |
|
|
1,187,672 |
|
||
Property, plant and equipment, net |
|
589,915 |
|
|
582,079 |
|
||
Deferred income tax |
|
21,755 |
|
|
21,256 |
|
||
|
147,968 |
|
|
149,890 |
|
|||
Intangible assets, net |
|
90,451 |
|
|
94,550 |
|
||
Other long-term assets |
|
163,284 |
|
|
159,048 |
|
||
Total assets | $ |
2,165,462 |
|
$ |
2,194,495 |
|
||
Liabilities | ||||||||
Current liabilities: | ||||||||
Line of credit | $ |
28,031 |
|
$ |
18,068 |
|
||
Accounts payable |
|
211,365 |
|
|
221,254 |
|
||
Accrued liabilities |
|
167,392 |
|
|
184,649 |
|
||
Income tax payable |
|
45,603 |
|
|
29,682 |
|
||
Current portion of long-term debt |
|
11,102 |
|
|
17,381 |
|
||
Total current liabilities |
|
463,493 |
|
|
471,034 |
|
||
Long-term debt, net of current portion |
|
192,538 |
|
|
265,574 |
|
||
Deferred tax liabilities |
|
32,432 |
|
|
32,230 |
|
||
Other long-term liabilities |
|
116,980 |
|
|
122,933 |
|
||
Total liabilities |
|
805,443 |
|
|
891,771 |
|
||
Commitments and contingencies | ||||||||
Stockholders' equity | ||||||||
Preferred stock - par value |
|
- |
|
|
- |
|
||
Common stock - par value |
|
36,338 |
|
|
36,195 |
|
||
Additional paid-in capital |
|
470,363 |
|
|
471,649 |
|
||
Retained earnings |
|
1,189,500 |
|
|
1,116,809 |
|
||
|
(336,894 |
) |
|
(336,894 |
) |
|||
Accumulated other comprehensive loss |
|
(61,804 |
) |
|
(50,517 |
) |
||
Total stockholders' equity |
|
1,297,503 |
|
|
1,237,242 |
|
||
Noncontrolling interest |
|
62,516 |
|
|
65,482 |
|
||
Total equity |
|
1,360,019 |
|
|
1,302,724 |
|
||
Total liabilities and stockholders' equity | $ |
2,165,462 |
|
$ |
2,194,495 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20220504005968/en/
Company Contact:
Director, IR & Corporate Marketing
P: 408-232-9003
E: Gurmeet_Dhaliwal@diodes.com
Investor Relations Contact:
President, Investor Relations
P: 949-224-3874
E: lsievers@sheltongroup.com
Source:
FAQ
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