Diodes Incorporated Reports Record Fourth Quarter and Fiscal 2021 Financial Results
Diodes Incorporated (DIOD) reported record financial results for the fourth quarter and fiscal year ended December 31, 2021. Fourth quarter revenue reached $480.2 million, up 37% year-over-year, while GAAP gross profit was $190.7 million, yielding a gross margin of 39.7%. Annual revenue totaled $1.81 billion, representing a 46.9% increase, with GAAP EPS at $5.00, a 166% improvement. The company anticipates first-quarter 2022 revenue of approximately $480 million, plus or minus 3%, suggesting resilience against typical seasonal declines.
- Record fourth quarter revenue of $480.2 million, up 37% year-over-year.
- Annual revenue reached $1.81 billion, a 46.9% increase compared to 2020.
- GAAP EPS for the year was a record $5.00, up 166% from the previous year.
- Achieved record gross profit of $670 million in 2021, increasing 55.5% year-over-year.
- EBITDA for the fourth quarter was $139 million, or 28.9% of revenue.
- GAAP net income decreased 4.3% sequentially from the third quarter.
- Fourth quarter non-GAAP adjusted EPS decreased 8.8% from the prior quarter.
Achieves Record Gross Margin of
Fourth Quarter and Recent Highlights
-
Revenue was a record
, increasing 37.0 percent from$480.2 million in the fourth quarter 2020 and 1.9 percent from$350.4 million in the third quarter 2021;$471.4 million -
GAAP gross profit was a record
, increasing 55.4 percent from$190.7 million in the fourth quarter 2020 and 5.2 percent from$122.7 million in the third quarter 2021;$181.2 million - GAAP gross profit margin was a record 39.7 percent, an increase of 470 basis points from the 35.0 percent in the fourth quarter 2020 and 130 basis points from the 38.4 percent in the third quarter 2021;
-
GAAP net income was
, compared to$65.5 million in the fourth quarter 2020 and$29.7 million in the third quarter 2021;$68.4 million -
Non-GAAP adjusted net income was a record
, compared to$73.3 million in the fourth quarter 2020 and$37.3 million in the third quarter 2021;$67.3 million -
GAAP EPS was
per diluted share, a 142 percent improvement from the$1.43 per diluted share in the fourth quarter 2020 and a 4.7 percent decrease compared to$0.59 per diluted share in the third quarter 2021;$1.50 -
Non-GAAP EPS was a record
per diluted share, a 116 percent improvement from the$1.60 per diluted share in the prior year quarter and an 8.8 percent increase from the$0.74 per diluted share last quarter;$1.47 -
Excluding
, net of tax, of non-cash share-based compensation expense, both GAAP and non-GAAP earnings per share would have increased by$6.5 million per diluted share;$0.14 -
EBITDA was a record
, or 28.9 percent of revenue, compared to$139.0 million , or 19.2 percent of revenue, in the fourth quarter 2020 and$67.1 million , or 24.3 percent of revenue, in the third quarter 2021; and$114.5 million -
Achieved cash flow from operations of
and$77.6 million of free cash flow, including$22.5 million of capital expenditures. Net cash flow was a positive$55.0 .$82.0 million
Year 2021 Highlights
-
Revenue grew to a record
, an increase of 46.9 percent over the$1.81 billion in 2020;$1.23 billion -
GAAP gross profit was a record
, a 55.5 percent increase from$670.4 million in the prior year;$431.1 million - GAAP gross profit margin improved 200 basis points to 37.1 percent from 35.1 percent in 2020;
-
GAAP operating income increased 105.4 percent to a record
, or 15.3 percent of revenue, compared to$276.0 million , or 10.9 percent of revenue, in 2020;$134.3 million -
GAAP net income was a record
, an increase of 133 percent from the$228.8 million last year;$98.1 million -
Non-GAAP adjusted net income was a record
, an increase of 93.3 percent from the$237.2 million in 2020;$122.7 million -
GAAP EPS was a record
per diluted share, a 166 percent improvement from the$5.00 per diluted share in 2020;$1.88 -
Non-GAAP EPS was a record
per diluted share, a 120 percent improvement from the$5.18 per diluted share in 2020;$2.35 -
Excluding
, net of tax, non-cash share-based compensation expense, both GAAP net income and non-GAAP adjusted net income would have increased by$26.2 million per diluted share;$0.57 -
EBITDA improved 82.1 percent to a record
, or 24.1 percent of revenue, compared to$434.6 million , or 19.4 percent of revenue in 2020; and$238.6 million -
Achieved a record
cash flow from operations and a record$338.5 million of free cash flow, including$197.3 million of capital expenditures, or 7.8 percent of revenue. Net cash flow was a positive$141.2 million , which includes the pay down of$46.3 million of long-term debt.$152.6 million
Commenting on the results, Dr.
“Additionally, gross margin expanded 610 basis points from the first quarter of 2021, the first full quarter after completing the
“With full year revenue of
Fourth Quarter 2021
Revenue for fourth quarter 2021 was a record
GAAP gross profit for the fourth quarter 2021 was a record
GAAP operating expenses for fourth quarter 2021 were
Fourth quarter 2021 GAAP net income was
Fourth quarter 2021 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 |
|
|
|
GAAP diluted earnings per share |
|
|
|
Adjustments to reconcile net income to non-GAAP net income: | |||
Amortization of acquisition-related intangible assets | 3,329 |
|
|
Acquisition-related costs | 435 |
|
|
LSC investments related | 13,461 |
|
|
Gain on sale of manufacturing subsidiary | (9,446 |
) |
|
Non-GAAP net income |
|
|
|
Non-GAAP diluted earnings per share |
|
|
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 fourth quarter 2021 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 fourth quarter 2021 was a record
For fourth quarter 2021, 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 Company’s 2021 annual audit by its independent registered public accounting firm. As such, these results are subject to revision until the Company files its Form 10-K for the year ending
Business Outlook
Purchase accounting adjustments related to 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 first quarter of 2022, we expect revenue to increase to approximately
DIODES is a trademark of
DIODES INCORPORATED AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except per share data) |
||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||
2021 |
|
2020 |
|
|
|
2021 |
|
2020 |
||||||||||
Net sales | $ |
480,171 |
|
$ |
350,370 |
|
$ |
1,805,162 |
|
$ |
1,229,215 |
|
||||||
Cost of goods sold |
|
289,480 |
|
|
227,673 |
|
|
1,134,802 |
|
|
798,094 |
|
||||||
Gross profit |
|
190,691 |
|
|
122,697 |
|
|
670,360 |
|
|
431,121 |
|
||||||
Operating expenses | ||||||||||||||||||
Selling, general and administrative |
|
70,951 |
|
|
52,829 |
|
|
257,710 |
|
|
185,067 |
|
||||||
Research and development |
|
30,096 |
|
|
24,819 |
|
|
119,200 |
|
|
94,288 |
|
||||||
Amortization of acquisition-related intangible assets |
|
4,077 |
|
|
4,012 |
|
|
16,216 |
|
|
16,261 |
|
||||||
Loss (gain) on disposal of fixed assets |
|
177 |
|
|
214 |
|
|
246 |
|
|
106 |
|
||||||
Other operating expense |
|
(601 |
) |
|
1,067 |
|
|
1,003 |
|
|
1,067 |
|
||||||
Total operating expense |
|
104,700 |
|
|
82,941 |
|
|
394,375 |
|
|
296,789 |
|
||||||
Income from operations |
|
85,991 |
|
|
39,756 |
|
|
275,985 |
|
|
134,332 |
|
||||||
Other income (expense) | ||||||||||||||||||
Interest income |
|
788 |
|
|
487 |
|
|
3,139 |
|
|
1,066 |
|
||||||
Interest expense |
|
(1,193 |
) |
|
(4,019 |
) |
|
(7,491 |
) |
|
(11,662 |
) |
||||||
Foreign currency loss, net |
|
(1,123 |
) |
|
(3,671 |
) |
|
(2,107 |
) |
|
(9,814 |
) |
||||||
Unrealized gain on investments |
|
13,180 |
|
|
2,083 |
|
|
28,018 |
|
|
2,083 |
|
||||||
Other income |
|
11,153 |
|
|
1,434 |
|
|
17,551 |
|
|
4,336 |
|
||||||
Total other income (expense) |
|
22,805 |
|
|
(3,686 |
) |
|
39,110 |
|
|
(13,991 |
) |
||||||
Income before income taxes and noncontrolling interest |
|
108,796 |
|
|
36,070 |
|
|
315,095 |
|
|
120,341 |
|
||||||
Income tax provision |
|
42,487 |
|
|
6,015 |
|
|
78,807 |
|
|
21,112 |
|
||||||
Net income |
|
66,309 |
|
|
30,055 |
|
|
236,288 |
|
|
99,229 |
|
||||||
Less: net (income) loss attributable to noncontrolling interest |
|
(796 |
) |
|
(320 |
) |
|
(7,525 |
) |
|
(1,141 |
) |
||||||
Net income attributable to common stockholders | $ |
65,513 |
|
$ |
29,735 |
|
$ |
228,763 |
|
$ |
98,088 |
|
||||||
Earnings per share attributable to common stockholders: | ||||||||||||||||||
Basic | $ |
1.46 |
|
$ |
0.60 |
|
$ |
5.11 |
|
$ |
1.92 |
|
||||||
Diluted | $ |
1.43 |
|
$ |
0.59 |
|
$ |
5.00 |
|
$ |
1.88 |
|
||||||
Number of shares used in computation: | ||||||||||||||||||
Basic |
|
45,018 |
|
|
49,340 |
|
|
44,772 |
|
|
51,004 |
|
||||||
Diluted |
|
45,942 |
|
|
50,418 |
|
|
45,781 |
|
|
52,133 |
|
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 | $ |
65,513 |
|
|||||||||||
Diluted earnings per share (Per-GAAP) | $ |
1.43 |
|
|||||||||||
Adjustments to reconcile net income to non-GAAP net income: | ||||||||||||||
Amortization of acquisition-related intangible assets | 4,077 |
|
(748 |
) |
|
|
3,329 |
|
||||||
Acquisition-related costs | 551 |
(116 |
) |
|
435 |
|
||||||||
LSC investments related | (13,181 |
) |
26,642 |
|
|
13,461 |
|
|||||||
Gain on sale of manufacturing subsidiary | (9,446 |
) |
- |
|
|
(9,446 |
) |
|||||||
Restructuring costs | - |
- |
|
|
- |
|
||||||||
Non-GAAP | $ |
73,292 |
|
|||||||||||
Diluted shares used in computing earnings per share |
|
45,942 |
|
|||||||||||
Non-GAAP diluted earnings per share | $ |
1.60 |
|
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 | $ |
29,735 |
|
|||||||||||||
Diluted earnings per share (Per-GAAP) |
|
0.59 |
|
|||||||||||||
Adjustments to reconcile net income to non-GAAP net income: | ||||||||||||||||
Amortization of acquisition-related intangible assets | 4,012 |
(742 |
) |
|
3,270 |
|
||||||||||
Acquisition-related financing costs | 3,277 |
|
(721 |
) |
|
2,556 |
|
|||||||||
Acquisition-related costs | 306 |
1,397 |
59 |
|
(290 |
) |
|
1,472 |
|
|||||||
LSC investments related | (2,143 |
) |
429 |
|
|
(1,714 |
) |
|||||||||
Restructuring Cost | 2,471 |
(462 |
) |
|
2,009 |
|
||||||||||
Non-GAAP | $ |
37,328 |
|
|||||||||||||
Diluted shares used in computing earnings per share |
|
50,418 |
|
|||||||||||||
Non-GAAP diluted earnings per share | $ |
0.74 |
|
Note: Included in GAAP and non-GAAP adjusted net income was approximately
DIODES INCORPORATED AND SUBSIDIARIES RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME (in thousands, except per share data) (unaudited) |
||||||||||||||
For the twelve months ended |
||||||||||||||
Operating Expenses | Other Income (Expense) | Income Tax Provision | Net Income | |||||||||||
Per-GAAP | $ |
228,763 |
|
|||||||||||
Diluted earnings per share (Per-GAAP) | $ |
5.00 |
|
|||||||||||
Adjustments to reconcile net income to non-GAAP net income: | ||||||||||||||
Amortization of acquisition-related intangible assets | 16,216 |
(2,974 |
) |
|
13,242 |
|
||||||||
Acquisition-related costs | 2,816 |
(591 |
) |
|
2,225 |
|
||||||||
LSC investments related | (28,018 |
) |
29,609 |
|
|
1,591 |
|
|||||||
Gain on sale of manufacturing subsidiary | (9,446 |
) |
- |
|
|
(9,446 |
) |
|||||||
Restructuring costs | 961 |
(144 |
) |
|
817 |
|
||||||||
Non-GAAP | $ |
237,192 |
|
|||||||||||
Diluted shares used in computing earnings per share |
|
45,781 |
|
|||||||||||
Non-GAAP diluted earnings per share | $ |
5.18 |
|
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 twelve months ended |
|||||||||||||||
COGS | Operating Expenses | Other Income (Expense) | Income Tax Provision | Net Income | |||||||||||
Per-GAAP | $ |
98,088 |
|
||||||||||||
Diluted earnings per share (Per-GAAP) | $ |
1.88 |
|
||||||||||||
Adjustments to reconcile net income to non-GAAP net income: | |||||||||||||||
Amortization of acquisition-related intangible assets | 16,261 |
(2,991 |
) |
|
13,270 |
|
|||||||||
Acquisition-related financing costs | 9,395 |
|
(2,064 |
) |
|
7,331 |
|
||||||||
Acquisition-related costs | 306 |
2,521 |
59 |
|
(520 |
) |
|
2,366 |
|
||||||
Restructuring Cost | 2,471 |
(462 |
) |
|
2,009 |
|
|||||||||
Board-member retirement costs | 1,705 |
(358 |
) |
|
1,347 |
|
|||||||||
LSC investments related | (2,143 |
) |
429 |
|
|
(1,714 |
) |
||||||||
Non-GAAP | $ |
122,697 |
|
||||||||||||
Diluted shares used in computing earnings per share |
|
52,133 |
|
||||||||||||
Non-GAAP diluted earnings per share | $ |
2.35 |
|
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
LSC investments related – The Company excluded market to market adjustments and the associated tax on certain LSC equity investments. The Company has also excluded certain taxes related to integration and restructuring activities within certain
Gain on sale of manufacturing subsidiary – The Company excluded gains associated with the sale of a manufacturing subsidiary. The transaction closed in
Restructuring costs – The Company has recorded restructuring charges related to the shutdown and relocation of one of our assembly and test facilities located in
Board member retirement costs – The Company excluded expenses in connection with the retirement of a member of the Company’s board of directors. The Company modified that director’s unvested RSU grants to vest upon his retirement. The shares subject to the modified grants will be released to that board member as if they were vesting under the original vesting timeline. In connection with this modification the Company recorded additional expense of approximately
CASH FLOW ITEMS
Free cash flow (FCF) (Non-GAAP)
FCF for the fourth quarter of 2021 is a non-GAAP financial measure, which is calculated by subtracting capital expenditures from cash flow from operations. For the fourth quarter of 2021, 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 | Twelve Months Ended | |||||||||||
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||
Net income (per-GAAP) | $ |
65,513 |
$ |
29,735 |
$ |
228,763 |
$ |
98,088 |
||||
Plus: | ||||||||||||
Interest expense, net |
|
405 |
|
3,532 |
|
4,352 |
|
10,596 |
||||
Income tax provision |
|
42,487 |
|
6,015 |
|
78,807 |
|
21,112 |
||||
Depreciation and amortization |
|
30,572 |
|
27,802 |
|
122,656 |
|
108,845 |
||||
EBITDA (non-GAAP) | $ |
138,977 |
$ |
67,084 |
$ |
434,578 |
$ |
238,641 |
||||
DIODES INCORPORATED AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (in thousands) |
|||||||
2021 |
2020 |
||||||
(unaudited) | (audited) | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ |
363,599 |
|
$ |
268,065 |
|
|
Restricted Cash |
|
3,219 |
|
|
52,464 |
|
|
Short-term investments |
|
6,542 |
|
|
6,142 |
|
|
Accounts receivable, net of allowances of |
|
358,496 |
|
|
320,061 |
|
|
Inventories |
|
348,622 |
|
|
307,062 |
|
|
Prepaid expenses and other |
|
107,194 |
|
|
70,193 |
|
|
Total current assets |
|
1,187,672 |
|
|
1,023,987 |
|
|
Property, plant and equipment, net |
|
582,079 |
|
|
530,815 |
|
|
Deferred income tax |
|
21,256 |
|
|
57,841 |
|
|
|
149,890 |
|
|
158,331 |
|
||
Intangible assets, net |
|
94,550 |
|
|
110,591 |
|
|
Other long-term assets |
|
159,048 |
|
|
97,892 |
|
|
Total assets | $ |
2,194,495 |
|
$ |
1,979,457 |
|
|
Liabilities | |||||||
Current liabilities: | |||||||
Line of credit | $ |
18,068 |
|
$ |
140,563 |
|
|
Accounts payable |
|
221,254 |
|
|
168,045 |
|
|
Accrued liabilities |
|
184,649 |
|
|
160,117 |
|
|
Income tax payable |
|
29,682 |
|
|
19,177 |
|
|
Current portion of long-term debt |
|
17,381 |
|
|
21,860 |
|
|
Total current liabilities |
|
471,034 |
|
|
509,762 |
|
|
Long-term debt, net of current portion |
|
265,574 |
|
|
288,179 |
|
|
Deferred tax liabilities |
|
32,230 |
|
|
34,598 |
|
|
Other long-term liabilities |
|
122,933 |
|
|
130,795 |
|
|
Total liabilities |
|
891,771 |
|
|
963,334 |
|
|
Commitments and contingencies | |||||||
Stockholders' equity | |||||||
Preferred stock - par value shares issued or outstanding |
|
- |
|
|
- |
|
|
Common stock - par value authorized; 45,017,774 and 44,276,194, issued and outstanding at |
|
36,195 |
|
|
35,692 |
|
|
Additional paid-in capital |
|
471,649 |
|
|
449,598 |
|
|
Retained earnings |
|
1,116,809 |
|
|
888,046 |
|
|
9,259,858 shares held at |
|
(336,894 |
) |
|
(335,910 |
) |
|
Accumulated other comprehensive loss |
|
(50,517 |
) |
|
(73,606 |
) |
|
Total stockholders' equity |
|
1,237,242 |
|
|
963,820 |
|
|
Noncontrolling interest |
|
65,482 |
|
|
52,303 |
|
|
Total equity |
|
1,302,724 |
|
|
1,016,123 |
|
|
Total liabilities and stockholders' equity | $ |
2,194,495 |
|
$ |
1,979,457 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20220208006266/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:
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