RESULTS OF OPERATIONS
1Q17 Results Highlights -- Consolidated
- Net revenue contribution from packaging operations, testing operations, EMS operations, substrates sold to third parties and others, each represented approximately 45%, 10%, 44%, 1% and 0%, respectively, of total net revenues for the quarter.
- Cost of revenue was NT$54,573 million for the quarter, down from NT$61,751 million in 4Q16.
- Raw material cost totaled NT$31,285 million for the quarter, representing 47% of total net revenues
- Labor cost totaled NT$8,857 million for the quarter, representing 13% of total net revenues.
- Depreciation, amortization and rental expenses totaled NT$6,937 million for the quarter.
- Gross margin decreased 1.9 percentage points to 18.0% in 1Q17 from 19.9% in 4Q16.
- Operating margin was 7.9% in 1Q17 compared to 10.5% in 4Q16.
- In terms of non-operating items:
- Net interest expense was NT$435 million.
- Net foreign exchange gain of NT$2,891 million was primarily attributable to the depreciation of the U.S. dollar against the NT dollar.
- Loss on valuation of financial assets and liabilities was NT$3,964 million.
- Net loss on equity-method investments was NT$162 million, including NT$54 million of the share of loss from our investment in Siliconware Precision Industries Co., Ltd.
- Other net non-operating income of NT$299 million were primarily related to miscellaneous income. Total non-operating expenses for the quarter was NT$1,371 million.
- Income before tax was NT$3,857 million for 1Q17, compared to NT$9,669 million in 4Q16. We recorded income tax expenses of NT$886 million for the quarter, compared to NT$1,274 million in 4Q16.
- In 1Q17, net income attributable to shareholders of the parent was NT$2,569 million, compared to net income attributable to shareholders of the parent of NT$3,882 million in 1Q16 and net income attributable to shareholders of the parent of NT$7,965 million in 4Q16.
- Our total number of shares outstanding at the end of the quarter was 8,273,546,046, including treasury stock owned by our subsidiaries. Our 1Q17 basic earnings per share of NT$0.33 (or US$0.054 per ADS) were based on 7,700,388,418 weighted average number of shares outstanding in 1Q17. Our 1Q17 diluted earnings per share of NT$0.30 (or US$0.047 per ADS) were based on 7,931,316,437 weighted average number of shares outstanding in 1Q17.
1Q17 Results Highlights -- IC ATM[2]
- Cost of revenues was NT$29,550 million for the quarter, down by 7% sequentially.
- Raw material cost totaled NT$8,698 million for the quarter, representing 23% of total net revenues
- Labor cost totaled NT$7,750 million for the quarter, representing 20% of total net revenues.
- Depreciation, amortization and rental expenses totaled NT$6,454 million for the quarter.
- Gross margin decreased 3.8 percentage points to 23.0% in 1Q17 from 26.8% in 4Q16.
- Operating margin was 10.4% in 1Q17 compared to 14.7% in 4Q16.
1Q17 Results Highlights -- EMS
- Cost of revenues for the quarter was NT$26,249 million, down by 15% sequentially.
- Raw material cost totaled NT$22,631 million for the quarter, representing 77% of total net revenues.
- Labor cost totaled NT$1,097 million for the quarter, representing 4% of total net revenues.
- Depreciation, amortization and rental expenses totaled NT$502 million for the quarter.
- Gross margin increased to 10.6% in 1Q17 from 10.4% in 4Q16.
- Operating margin increased to 4.2% in 1Q17 from 4.8% in 4Q16.
LIQUIDITY AND CAPITAL RESOURCES
- Capital expenditures in 1Q17 totaled US$155 million, of which US$120 million were used in packaging operations, US$31 million in testing operations, US$3 million in EMS operations and US$1 million in interconnect materials operations.
- As of March 31, 2017, total unused credit lines amounted to NT$183,034 million.
- Current ratio was 1.38 and net debt to equity ratio was 0.30 as of March 31, 2017.
- Total number of employees was 66,164 as of March 31, 2017, compared to 66,711 as of December 31, 2016.
Business Review
Packaging Operations[3]
- Gross margin for our packaging operations during the quarter was 20.7%, down by 3.4 percentage points from 4Q16.
- Capital expenditures for our packaging operations amounted to US$120 million for the quarter, of which US$78 million were used in purchases of wafer bumping and flip chip packaging equipment, and US$42 million were used in purchase of common equipment, SiP equipment and wirebond packaging equipment.
Testing Operations
- Depreciation, amortization and rental expense associated with our testing operations amounted to NT$1,759 million during the quarter, up from NT$1,806 million in 4Q17.
- Gross margin for our testing operations amounted to 33.4% during the quarter, down by 5.0 percentage points from 4Q16.
- Capital expenditures for our testing operations amounted to US$31 million during the quarter.
