Amkor Technology Reports First Quarter Results
Business Is Robust; Outlook Remains Strong for 2000
WEST CHESTER, Pa.--(BUSINESS WIRE)--May 4, 2000--Amkor Technology, Inc. (Nasdaq: AMKR), the world's largest provider of contract semiconductor packaging and test services, cited continued strong demand in reporting financial results for the first quarter ended March 31, 2000.
Total revenues rose 32% to $555 million from $420 million in the first quarter of 1999. Assembly & test revenues rose 34% to $469 million from $351 million in the first quarter of last year. Wafer foundry revenues were $86 million compared with $69 million in the first quarter of 1999.
Operating income more than doubled, to $63.4 million compared with $30.2 million in the first quarter of 1999. First quarter 2000 net income rose sharply to $37.2 million, or $0.27 per share, from $18.9 million, or $0.16 per share, for the first quarter of 1999.
"This was a very satisfying first quarter, as robust business conditions in the semiconductor industry over-rode what is typically a slow start," said John Boruch, Amkor's president. "We have been responding to this healthy industry environment by aggressively building our packaging design and development staff, and by expanding manufacturing capacity."
First quarter assembly unit shipments rose 46% over the year-ago quarter and 4.3% over the fourth quarter of 1999. High end (advanced leadframe and laminate) products were 63% of packaging and test revenues for the first quarter, compared to 59% in the first quarter of 1999.
"Based on aggregate customer forecasts, we believe that our business will continue to strengthen over the course of 2000," continued Mr. Boruch. "We are seeing exceptionally strong forecasted demand for the second half of the year. As we noted earlier this week, the acquisition of K1, K2 and K3 strengthens Amkor's leadership position in semiconductor assembly & test and will enhance the profitability of our core business. We also believe that the strategic investment in Anam Semiconductor presents an outstanding opportunity to capitalize on the increasing value of Anam's wafer foundry operation."
"Anam's wafer foundry is making excellent progress in its expansion program, and has entered the second quarter with a run rate of more than 23,000 wafers per month," said Mr. Boruch. "We expect that the fab will reach its full design capacity of 30,000 wafers per month by the end of 2000. The foundry is focused on the strengthening market for digital signal processors and other communications ICs and is currently producing wafers down to the .18 micron level. In addition to our primary customer - Texas Instruments - foundry customers now include Alcatel, Atmel, Ericsson, NEC and Toshiba."
Ken Joyce, Amkor's Chief Financial Officer, noted, "Investments in technology, fixed assets associated with capacity expansion, increased headcount at the factory level, and the ongoing development of our modules business impacted gross margins in the quarter, which were essentially flat with the fourth quarter of 1999. We expect to realize the benefits of these investments as the year progresses."
"In connection with the acquisition of K1, K2 & K3 and strategic investment in Anam, we issued approximately $259 million of 5% convertible subordinated notes in the first quarter. In April we raised additional financing in support of this transaction with the execution of a $900 million bank debt agreement and, as previously announced, the issuance of $410 million in private equity capital to a group of international investors. Also in April, after a thorough financial and business review, Moody's Investor Service upgraded Amkor's senior implied rating to Ba2 from Ba3, and Standard and Poor's rated Amkor's new $900 million bank package BB while affirming its BB- rating on the company's senior debt," said Mr. Joyce.
"As a result of the goodwill associated with the above transaction, commencing with the second quarter of 2000, we will report per share net earnings before goodwill amortization as a supplement to our traditional financial disclosure," said Mr. Joyce. "In the first quarter of 2000, goodwill amortization was approximately $9.7 million. Amkor presently expects to record approximately $22 million in goodwill amortization for the second quarter of 2000 and approximately $29 million in each of the third and fourth quarters of 2000."
Amkor Technology, Inc. is the world's largest provider of contract microelectronics manufacturing solutions.
Amkor offers semiconductor companies and electronics OEMs a complete set of microelectronic design and manufacturing services, including deep submicron wafer fabrication; wafer probe, characterization and reliability testing; IC packaging design and assembly; multi-chip module design and assembly; and final testing. |
