<PAGE> 1
Exhibit 99.1
News
Release
Amkor Technology Reports Second Quarter Results
BUSINESS EXPECTED TO STRENGTHEN IN SECOND HALF OF YEAR
West Chester, PA. -- August 2, 2000 -- Amkor Technology, Inc. (Nasdaq: AMKR),
the world's largest provider of contract semiconductor packaging and test
services, reported financial results for the second quarter ended June 30, 2000.
Revenues were $547 million, up 22 percent from $450 million in the second
quarter of 1999. Assembly & test revenues were $463 million compared with $380
million in the second quarter of last year. Wafer fab revenues were $84 million
compared with $70 million in the second quarter of 1999.
Net income before the amortization of goodwill and acquired intangibles was $51
million, or $0.33 per share, compared with $16 million, or $0.13 per share, for
the year-ago period. Including amortization of goodwill and acquired intangibles
net income was $31 million, or $0.20 per share, compared with $12 million, or
$0.10 per share, for the second quarter of 1999. (See Note on Financial
Presentation)
There were 158 million weighted average shares outstanding on a fully diluted
basis for the second quarter of 2000 compared with 118 million weighted average
fully diluted shares outstanding in the year-ago period. The increase
principally relates to the private placement of common stock in April 2000, the
issuance of convertible debt and the conversion of convertible subordinated
notes.
The gross margin for the second quarter of 2000 rose to 22.7% from 19.6% in Q1
'00 and 14.8% in Q2 '99. The increase in second quarter gross margin reflects
the positive impact of Amkor's May 1, 2000 acquisition of the K1, K2 & K3
factories from Anam Semiconductor (ASI).
Operating income rose sharply to $72 million from $29 million in the second
quarter of 1999.
Second quarter EBITDA more than doubled, to $150 million from $68 million in Q2
'99. We have calculated EBITDA as earnings before income taxes; equity in income
(loss) of affiliates; foreign currency gain or loss; interest expense, net;
depreciation and amortization. EBITDA is a common measure used by investors to
evaluate a company's ability to service debt. EBITDA is not defined by generally
accepted accounting principles.
Assembly unit shipments rose 34% over the year-ago quarter and 2% over the first
quarter of 2000. High end (advanced leadframe and laminate) products represented
62% of packaging and test revenues for the second quarter of 2000, compared to
59% in Q2 '99.
-more-
<PAGE> 2
Wafer fab sales reflected continued strong demand, primarily from Texas
Instruments for digital signal processor wafers. The Anam foundry averaged
approximately 24,000 wafer starts per month during the second quarter, as the
fab continued to ramp toward a planned capacity of 30,000 wafers per month by
the end of 2000.
For the first six months of 2000, revenues rose 27% to $1.1 billion from $870
million in the first six months of 1999. Net income before the amortization of
goodwill and acquired intangibles was $98 million, or $0.67 per share, compared
to $35 million, or $0.30 per share, for the year-ago period. Including
amortization of goodwill and acquired intangibles net income was $68 million, or
$0.47 per share, compared with $30 million, or $0.26 per share, for the first
six months of 1999. EBITDA more than doubled, to $265 million from $129 million
for the first six months of 1999.
"Our effective tax rate decreased to 15% in the second quarter, due to higher
levels of profitability in entities that are subject to tax holidays," said Mr.
Joyce. "We expect our tax rate to remain in the 15% - 17% range in the third and
fourth quarters of 2000."
"This was a difficult quarter in some respects, but a very positive one in
others," said John Boruch, Amkor's President. "In early May, we accomplished a
critical strategic goal when we completed the acquisition of K1, K2 and K3. This
transaction gives Amkor direct ownership of all our assembly and test factories,
and should significantly enhance the profitability of our core operating
business and provide substantial additional cash flow.
"K1, 2 & 3 have already been substantially integrated into Amkor's operating
system, and the gross margin pickup is immediate," said Ken Joyce, Chief
Financial Officer. "Prior to the acquisition, revenue from K1, 2 & 3 was subject
to a contractual gross margin that in 1999 averaged approximately 11.5%. By
contrast, for the period during Q2 2000 that we owned K1, 2 & 3, the gross
margin for these three factories was more than 29%, and this was after deducting
$9 million in goodwill and acquired intangibles in connection with the
acquisition. We presently expect consolidated gross margin to be approximately
25% in the third quarter, principally reflecting a full quarter's benefit of
this acquisition."
"Our ownership of K1, 2 & 3 has also had a dramatic impact on EBITDA, and we
expect full year 2000 EBITDA to increase substantially from 1999 levels,"
continued Mr. Joyce.
"As we indicated in our June 27th news release, revenues for the quarter were
around $30M below plan," said Mr. Boruch. "We attribute about a third of this
variance to advanced wafer capacity limitations at some of our customer
locations. Latest data indicates that wafer availability for these customers is
improving.
-more-
<PAGE> 3
The remaining variance to plan is due to the combined impact of the wafer
production shift out of chipsets by one of our largest customers and the loss of
business in our P3 factory due to a laminate contamination issue. The
contamination issue has been resolved and we are in a re-qualification process,
which will take several months."
"Our outlook for the third quarter of 2000 calls for revenue to increase 10% to
12% over Q2 '00," said Mr. Joyce.
"The good news is that demand for advanced packaging technology is getting
stronger," said Mr. Boruch. "We are designed into a number of key customer
programs where Amkor's advanced technology is creating solutions that meet
critical performance needs. In the area of Internet infrastructure, our high
performance SBGA package has been widely accepted as a primary package of choice
by many customers. This package family has also been widely designed into
high-end entertainment equipment using advanced microprocessors. In support of
leading edge analog applications, our MicroLeadFrame package family is beginning
a steep production ramp up. Fast growth in the high end ASICS and FPGA markets
are driving up demand for our Tape and Flex BGAs."
"Our System-in-package (SiP) initiative is progressing very well and holds
exciting promise for 2001 and beyond," said Mr. Boruch. "We are in developmental
or production stages on several SiP programs, including MultiMedia cards, RF
Power amplifiers modules, fingerprint sensor modules and high-speed Internet
switch modules. We are encouraged by the number of new opportunities presented
by quality customers and expect significant production increases over the next
several quarters".
"Amkor's VisionPak technology represents an attractive solution for integrating
CMOS vision sensors into a reliable and cost effective package. We believe this
packaging technology will either be adopted by, or help enable, a broad range of
vision-related applications over the next few years. The forecast is very strong
and production capability is being expanded rapidly," continued Mr. Boruch.
"The recent acquisition of Integra Technologies significantly expands our test
resources and capabilities, particularly with respect to test development and
conversion," said Mr. Boruch. "We have revamped our worldwide test organization
to provide additional focus to our goal of providing 'one stop shopping' for our
customers. Amkor is a very large test service provider.
-more-
<PAGE> 4
Our test floors in the Philippines and Korea encompass more than 200,000 square
feet of test space and over 500 test systems. Amkor is also one of the leaders
in offering massive parallel testing providing our customers with significant
cost reduction opportunities. We see enormous opportunities in test and we are
committed to capitalizing on them. Our current strong growth forecasts for test
services is an indication that our focus is achieving positive results".
NOTE ON FINANCIAL PRESENTATION
For the three months ended June 30, 2000, amortization of goodwill and acquired
intangibles consists of (1) $15 million of amortization of goodwill and other
acquisition-related intangibles, which amount is included in cost of sales; and
(2) $5 million of amortization of the difference between the cost of our equity
investment in ASI and our share of the underlying net assets, which amount is
included in our equity income of investees. For the six months ended June 30,
2000, the above amortization was $21 million and $9 million, respectively.
This news release contains forward-looking statements - such as (1) our
expectation that our tax rate will remain in the 15% - 17% range in the third
and fourth quarters of 2000; (2) our expectations that the acquisition of K1, 2
& 3 should significantly enhance the profitability of our core operating
business and provide substantial additional cash flow; (3) our expectation that
gross margin will be approximately 25% in the third quarter of 2000; (4) our
expectation that full year 2000 EBITDA will increase substantially from 1999
levels; (5) our belief that wafer availability is improving, and that die
support will strengthen in the second half of the year ; (6) our expectation
that Q3 '00 revenue will increase by 10% to 12% over Q2 '00; (7) our expectation
that our system-in-package initiative will result in significant production
increases over the next several quarters; and (8) our belief that our VisionPak
technology will either be adopted by, or help enable, a broad range of
vision-related applications over the next few years; - that involve risks and
uncertainties. Actual results could differ materially from anticipated results
for a variety of reasons, including increased competition; declines in average
selling prices; the absence of backlog and the timing and volume of orders
relative to production capacity; reliance on a small group of principal
customers; dependence on raw material and equipment suppliers; difficulties in
managing growth; and the results of ASI on an equity method of accounting basis.
Further information on risk factors that could affect the outcome of the events
set forth in these statements and that would affect the company's operating
results and financial condition is detailed in the company's filings with the
Securities and Exchange Commission, including the Report on Form 10-Q for the
fiscal quarter ended March 31, 2000.
-more-
<PAGE> 5
ABOUT AMKOR
Amkor Technology, Inc. is the world's largest provider of contract
microelectronics manufacturing solutions. The company offers semiconductor
companies and electronics OEMs a complete set of micro-electronics manufacturing
services including deep submicron wafer fabrication, wafer probe testing, IC
packaging design, assembly & testing, burn-in, characterization and reliability
testing. More information on Amkor Technology, Inc. is available from the
company's SEC filings and on Amkor's web site, http://www.amkor.com.
Contact:
Jeffrey Luth Ken Jensen
VP Investor Relations Director, Marketing Communications
610-431-9600 ext. 5613 480-821-2408 ext. 5130
[email protected] [email protected]
(tables to follow)
<PAGE> 6
AMKOR TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
June 30, June 30,
(unaudited) (unaudited)
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net revenues $ 547,036 $ 449,925 $ 1,101,847 $ 869,882
Cost of revenues--including purchases from ASI 407,441 379,133 847,221 735,918
Amortization of goodwill & other acquired intangibles 15,266 4,029 21,454 4,626
----------- ----------- ----------- -----------
Total cost of revenues 422,707 383,162 868,675 740,544
----------- ----------- ----------- -----------
Gross profit 124,329 66,763 233,172 129,338
----------- ----------- ----------- -----------
Operating expenses:
Selling, general and administrative 47,058 35,017 89,129 65,123
Research and development 4,872 2,843 8,243 5,094
----------- ----------- ----------- -----------
Total operating expenses 51,930 37,860 97,372 70,217
----------- ----------- ----------- -----------
Operating income 72,399 28,903 135,800 59,121
----------- ----------- ----------- -----------
Other (income) expense:
Interest expense, net 29,428 10,799 44,857 12,434
Foreign currency loss 1,756 98 2,592 404
Other expense(income), net (322) 2,006 2,038 3,628
----------- ----------- ----------- -----------
Total other expense 30,862 12,903 49,487 16,466
----------- ----------- ----------- -----------
Income before income taxes and equity in income of investees 41,537 16,000 86,313 42,655
Provision for income taxes (6,230) (4,480) (15,186) (12,210)
Equity in loss of investees (4,371) 0 (3,035) 0
----------- ----------- ----------- -----------
Net income $ 30,936 $ 11,520 $ 68,092 $ 30,445
=========== =========== =========== ===========
Per Share Data:
Basic net income per common share $ 0.21 $ 0.10 $ 0.49 $ 0.26
=========== =========== =========== ===========
Diluted net income per common share $ 0.20 $ 0.10 $ 0.47 $ 0.26
=========== =========== =========== ===========
Shares used in computing basic net income
per common share 148,530 118,131 139,701 117,995
=========== =========== =========== ===========
Shares used in computing diluted net income
per common share 157,617 118,396 148,078 118,289
=========== =========== =========== ===========
</TABLE>
<PAGE> 7
AMKOR TECHNOLOGY, INC.
SUPPLEMENTAL CONSOLIDATED STATEMENTS OF INCOME EXCLUDING
AMORTIZATION OF GOODWILL AND OTHER ACQUISITION-RELATED INTANGIBLES
(in thousands, except per share data)
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
June 30, June 30,
(unaudited) (unaudited)
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net revenues $ 547,036 $ 449,925 $ 1,101,847 $ 869,882
Cost of revenues--including purchases from ASI 407,441 379,133 847,221 735,918
----------- ----------- ----------- -----------
Gross profit 139,595 70,792 254,626 133,964
----------- ----------- ----------- -----------
Operating expenses:
Selling, general and administrative 47,058 35,017 89,129 65,123
Research and development 4,872 2,843 8,243 5,094
----------- ----------- ----------- -----------
Total operating expenses 51,930 37,860 97,372 70,217
----------- ----------- ----------- -----------
Operating income 87,665 32,932 157,254 63,747
----------- ----------- ----------- -----------
Other (income) expense:
Interest expense, net 29,428 10,799 44,857 12,434
Foreign currency loss 1,756 98 2,592 404
Other expense(income), net (322) 2,006 2,038 3,628
----------- ----------- ----------- -----------
Total other expense 30,862 12,903 49,487 16,466
----------- ----------- ----------- -----------
Income before income taxes and equity in income of investees 56,803 20,029 107,767 47,281
Provision for income taxes (6,230) (4,480) (15,186) (12,210)
Equity in income of investees 559 0 5,495 0
----------- ----------- ----------- -----------
Net income $ 51,132 $ 15,549 $ 98,076 $ 35,071
=========== =========== =========== ===========
Per Share Data:
Basic net income per common share $ 0.34 $ 0.13 $ 0.70 $ 0.30
=========== =========== =========== ===========
Diluted net income per common share $ 0.33 $ 0.13 $ 0.67 $ 0.30
=========== =========== =========== ===========
Shares used in computing basic net income
per common share 148,530 118,131 139,701 117,995
=========== =========== =========== ===========
Shares used in computing diluted net income
per common share 157,617 118,396 148,078 118,289
=========== =========== =========== ===========
</TABLE>
The above supplemental consolidated statements of income exclude the effects of
the following:
During the three months and six months ended June 30, 2000, the
amortization of goodwill and other acquired intangibles excluded from
cost of sales was $15.3 million and $21.5 million, respectively.
During the three months and six months ended June 30, 1999, the
amortization of goodwill excluded from cost of sales was $4.0 million
and $4.6 million, respectively.
During the three months and six months ended June 30, 2000, the
amortization of the difference between the cost of our equity
investments and our share of the underlying net assets of ASI excluded
from equity in income of investees was $4.9 million and $8.5 million,
respectively.
<PAGE> 8
AMKOR TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
June 30, December 31,
2000 1999
---- ----
(unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents........................................... $ 136,274 $ 98,045
Short-term investments.............................................. -- 136,595
Accounts receivable --
Trade, net of allowance for doubtful accounts of $2,443......... 264,799 157,281
Due from affiliates............................................. 2,778 6,278
Other........................................................... 6,986 6,469
Inventories......................................................... 93,327 91,465
Other current assets................................................ 23,684 11,117
---------- ----------
Total current assets....................................... 527,848 507,250
---------- ----------
Property, plant and equipment, net....................................... 1,428,187 859,768
---------- ----------
Investments ........................................................... 399,227 63,672
---------- ----------
Other assets:
Due from affiliates................................................. 27,181 27,858
Goodwill ........................................................... 713,163 232,350
Other ........................................................... 286,082 64,191
---------- ----------
1,026,426 324,399
---------- ----------
Total assets............................................... $3,381,688 $1,755,089
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Bank overdraft...................................................... $ 28,169 $ 16,209
Short-term borrowings and current portion of long-term debt......... 73,579 6,465
Trade accounts payable.............................................. 182,036 122,147
Due to affiliates................................................... 37,683 37,913
Accrued expenses.................................................... 104,355 88,577
Accrued income taxes................................................ 45,245 41,587
---------- ----------
Total current liabilities.................................. 471,067 312,898
Long-term debt........................................................... 1,642,076 687,456
Other noncurrent liabilities............................................. 44,585 16,994
---------- ----------
Total liabilities.......................................... 2,157,728 1,017,348
---------- ----------
Commitments and contingencies
Stockholders' Equity:
Common stock........................................................ 152 131
Additional paid-in capital.......................................... 970,087 551,964
Retained earnings................................................... 257,825 189,733
Receivable from stockholder......................................... (3,276) (3,276)
Accumulated other comprehensive income.............................. (828) (811)
---------- ----------
Total stockholders' equity................................. 1,223,960 737,741
---------- ----------
Total liabilities and stockholders' equity................. $3,381,688 $1,755,089
========== ==========
</TABLE>
