ASAT Holdings Announces Financial Results for the Fourth Quarter and Fiscal Year 2008; Revenue For July 2009 Quarter Expected To Rise Approximately 30 Percent Sequentially
PR Newswire, July 31, 2008 Thursday 11:00 AM GMT
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HONG KONG and MILPITAS, Calif., July 31 /PRNewswire-FirstCall/ -- ASAT Holdings Limited(OTC:ASTTY.OB)(BULLETIN BOARD: ASTTY.OB) , a global provider of semiconductor package design, assembly and test services, today announced financial results for the fourth quarter and fiscal 2008, ended April 30, 2008.
(Logo: http://www.newscom.com/cgi-bin/prnh/20080325/AQTU023LOGO )
Net revenue for the fourth quarter of fiscal 2008 was $36.2 million compared with $41.8 million in the previous quarter. Fourth quarter net loss of $8.8 million, or a net loss of $0.20 per American Depositary Share (ADS), compares with a net loss of $5.0 million, or a net loss of $0.12 per ADS in the third quarter. Included in the fourth quarter net loss were reorganization charges of approximately $19,000 related to completing the move of the Company's manufacturing operations to China. Net loss in the third quarter included charges of approximately $149,000 in similar expenses.
"Our fourth quarter revenue declined due to a combination of factors. These included the economic uncertainty that impacted many of our customers resulting in an inventory correction, and a seasonally slower period in our industry," said Kei Hong Chua, chief financial officer of ASAT Holdings Limited.
Additional Fourth Quarter Results |
-- Net sales for assembly were $35.5 million |
-- Net sales for test were $0.7 million |
-- Capital expenditures were $2.0 million |
-- Cash and cash equivalents at the end of the quarter were $6.0 million |
Fiscal 2008 Financial Results |
Net revenue for fiscal 2008 was $156.0 million, compared with net revenue of $164.9 million in fiscal 2007. Fiscal 2008 net loss was $24.7 million, or a net loss of $0.59 per ADS. This compares with a net loss of $35.0 million, or a net loss of $0.83 per ADS, in the prior fiscal year. The net loss for both fiscal years reflects the ADS ratio change from 5 ordinary shares per ADS to 15 ordinary shares per ADS, effective December 26, 2006.
"Our improved fiscal 2008 results, including higher gross margin, reduced operating expenses and lower net loss, reflect the positive impact our lower- cost Dongguan facility is having on our financial performance as compared with fiscal 2007," said Tung Lok Li, acting chief executive officer of ASAT Holdings Limited. "With the move to Dongguan completed and the cost savings in place, we are focused on driving revenue growth in fiscal 2009. In addition, we have secured additional financing, which we will leverage to drive this top-line improvement."
New Financing
The Company recently closed on two new financing facilities totaling approximately US$14 million. These funds are in addition to the original facility that is still in place through September 2008.
"We are pleased to have secured these new sources of financing. The funds will be used to support our expected growth in fiscal 2009," said Kei Hong Chua, chief financial officer of ASAT Holdings Limited. "The new financing consists of one facility of RMB 60 million that includes an approximately US$5 million credit line and US$4 million that is backed by pledged assets. The second facility is a US$5 million line that is also backed by pledged assets. In addition, we continue to work towards the renewal of our existing US$20 million facility."
While the Company believes the renewal of existing facilities is likely, there can be no assurance that it will be obtained, and if such financing is not obtained for any reason there may be questions regarding the Company's ability to continue as a going concern.
First Quarter Fiscal 2009 Outlook
"In recent months we have focused our sales efforts on increasing revenue from our top customers, which we believe offer the quickest route to growing revenue," said Mr. Li. "We are making very good progress on this strategy, and currently believe that for the July quarter revenue growth will be up approximately 30 percent sequentially."
Conference Call and Webcast on July 31, 2008 at 8:30 a.m. ET
ASAT Holdings is scheduled to hold a conference call to discuss the financial results and other financial matters today at 8:30 a.m. ET/5:30 a.m. PT. To access the call, dial (480) 248-5081. A replay of the call will be available until August 7, 2008. To access the replay, dial (303) 590-3030. The passcode is 3904866. A live webcast of the call will also be available via the investor relations section of the Company's website at http://www.asat.com/ .
ASAT Holdings Limited
ASAT Holdings Limited is a global provider of semiconductor package design, assembly and test services. With 20 years of experience, the Company offers a definitive selection of semiconductor packages and world-class manufacturing lines. ASAT's advanced package portfolio includes standard and high thermal performance ball grid arrays, leadless plastic chip carriers, thin array plastic packages, system-in-package and flip chip. ASAT was the first company to develop moisture sensitive level one capability on standard leaded products. Today the Company has operations in the United States, Asia and Europe. For more information, visit http://www.asat.com/ .
Safe Harbor
This news release contains statements and information that involve risks, uncertainties and assumptions. These statements and information constitute "forward-looking statements" within the meaning of federal securities laws including Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended. Such forward-looking statements, including statements regarding expected revenues, liquidity and financial position in our fiscal quarter, our manufacturing capacity and cost structure, our operational efficiencies, our relocation and reorganization costs, our customer retention, growth and expectations, our continuation as a going concern and our capital needs, involve known and unknown risks, uncertainties, assumptions and other factors that could cause the actual performance, financial condition or results of operations of ASAT Holdings Limited to differ materially from those expressed or implied in any forward-looking statement. Investors are cautioned that actual events and results could differ materially from those contained in these statements as a result of a variety of factors, including whether an active trading market in the Company's ADSs will develop or be maintained on the OTC Bulletin Board or any other trading market, obtaining future financing, conditions in the overall semiconductor market and economy, our progress in ramping the new China facility, acceptance and demand for the Company's products and services, continued operational efficiencies, customer retention, growth and expectations, operational and technological risks and revisions to the preliminary unaudited financial results which may occur during preparation of financial statements and disclosures and the preparation of the Company's quarterly report on Form 6-K and annual report on Form 20-F. The risks, uncertainties and other factors also include, among others, our ability to successfully implement our diversification strategy and our long- term growth strategy, our ability to continue to realize operational efficiencies and improvements to our cost structure, our ability to obtain future financing, the risk that an active trading market in the Company's American Depositary Shares will not develop or be maintained on the OTC Bulletin Board or any other trading market, and those risks, uncertainties, assumptions and other factors stated in the section entitled "Risk Factors" in our Annual Report on Form 20-F filed with the United States Securities and Exchange Commission on October 15, 2007 and the section entitled "Risk Factors" in our current reports on Form 6-K filed with the United States Securities and Exchange Commission containing quarterly financial information. The forward-looking statements in this release reflect the current beliefs and expectations of the Company as of this date, and the Company undertakes no obligation to update these projections and forward-looking statements to reflect actual results or events or circumstances that occur after the date of this news release.
Revenue Breakdown by Market Segment |
Three Months Ended |
April 30, 2008 January 31, 2008 |
Market Segment % of Net Revenues % of Net Revenues |
(Unaudited) |
Communications 50 48 |
Automotive/Industrial & Other 16 14 |
Consumer 14 16 |
PC/Computing 20 22 |
Revenue Breakdown by Region |
Three Months Ended |
April 30, 2008 January 31, 2008 |
Region % of Net Revenues % of Net Revenues |
(Unaudited) |
United States 85 85 |
Europe 4 4 |
Asia 11 11 |
Revenue Breakdown by Customer Type |
Three Months Ended |
April 30, 2008 January 31, 2008 |
Customer Type % of Net Revenues % of Net Revenues |
(Unaudited) |
Fabless 80 84 |
IDM 20 16 |
Summary financial data follows |
ASAT Holdings Limited |
Condensed Consolidated Statements of Operations |
(USD in thousands, except share data) |
For the three months ended April 30, 2008, |
January 31, 2008 and April 30, 2007, and |
For the year ended April 30, 2008 |
and April 30, 2007 |
Three Months Ended Year Ended |
April 30, January 31, April 30, April 30, April 30, |
2008 2008 2007 2008 2007 |
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Audited)* |
Net Sales 36,228 41,764 35,985 155,961 164,853 |
Cost of sales |
(Note A) 34,399 36,783 33,399 138,683 149,927 |
Gross profit 1,829 4,981 2,586 17,278 14,926 |
Operating expenses: |
Selling, |
general and |
administrative 4,411 4,157 5,794 18,940 22,065 |
Research and |
development 505 519 475 2,034 2,218 |
Reorganization |
expenses (Note B) 19 149 682 392 2,473 |
Facilities and |
relocation charges - - 89 - 3,047 |
Total operating |
expenses 4,935 4,825 7,040 21,366 29,803 |
Income/(loss) from |
operations (3,106) 156 (4,454) (4,088) (14,877) |
Other (expenses)/ |
income, net (901) (111) (397) (722) 643 |
Interest expense: - |
- amortization |
of deferred |
charges (739) (773) (858) (3,245) (3,705) |
- third |
parties (3,943) (4,092) (4,013) (16,281) (15,837) |
Loss before |
income taxes (8,689) (4,820) (9,722) (24,336) (33,776) |
Income tax |
expense |
(Note C) (98) (130) (1,264) (339) (1,264) |
Net loss (8,787) (4,950) (10,986) (24,675) (35,040) |
Other comprehensive |
loss: |
Foreign currency |
translation 18 9 22 61 39 |
Comprehensive |
loss (8,769) (4,941) (10,964) (24,614) (35,001) |
Net loss applicable |
to ordinary |
shareholders: |
Net loss (8,787) (4,950) (10,986) (24,675) (35,040) |
Preferred |
shares: |
Cumulative |
preferred |
share |
dividends (507) (507) (497) (2,028) (1,990) |
Accretion of |
preferred |
shares (433) (411) (339) (1,591) (1,232) |
Net loss |
applicable to |
ordinary |
shareholders: (9,727) (5,868) (11,822) (28,294) (38,262) |
Basic and diluted |
loss per ADS |
(Note D): |
Basic and |
diluted: |
Net loss (0.20) (0.12) (0.25) (0.59) (0.83) |
Basic and diluted |
weighted average |
number of ADSs |
outstanding |
(Note D) 49,722,587 48,723,339 46,695,972 48,306,653 46,119,881 |
Basic and diluted |
loss per |
ordinary share: |
Basic and |
diluted: |
Net loss (0.01) (0.01) (0.02) (0.04) (0.06) |
Basic and diluted |
weighted average |
number of |
ordinary shares |
out- |
standing 745,838,798 730,850,088 700,439,575 724,599,796 691,798,216 |
Note A: Includes $(67) thousand, $79 thousand and $1,356 thousand inventory (reversal)/write-down in the three months ended April 30, 2008, January 31, 2008 and April 30, 2007, respectively. Includes $861 thousand and $1,611 thousand inventory write-down for the year ended April 30, 2008 and April 30, 2007 respectively.
Note B: Includes charges of $19 thousand, $149 thousand and $682 thousand associated with headcount reductions in the three months ended April 30, 2008, January 31, 2008 and April 30, 2007, respectively. The charge for this quarter is primarily related to the headcount reductions of the Company's US employees; while the charges for other periods are primarily relate to the headcount reductions of the Company's Hong Kong employees.
Note C: The amount for the fiscal period of 2008 mainly represents provision for the US Income Tax, the PRC Enterprise Income Tax and the Hong Kong Profits Tax. The amount for the period ended April 30, 2007 represents provision for the Hong Kong Profits Tax concerning a tax dispute for the fiscal year 2000.
Note D: On December 8, 2006, the Company announced an intention to change the ADS ratio from 5 ordinary shares per 1 ADS to 15 ordinary shares per 1 ADS, representing the equivalent of a 1-for-3 reverse split. The new ADS ratio had taken effect at the close of business on December 22, 2006 and the new ADS ratio had in place at beginning of the next business day on December 26, 2006. The basic and diluted loss per ADS has been prepared on the number of ADS after the reverse share split.
* Extracted from the audited financial statements |
ASAT Holdings Limited |
Condensed Consolidated Balance Sheets |
(USD in thousands) |
As of April 30, 2008, January 31, 2008 and April 30, 2007 |
April 30, January 31, April 30, |
2008 2008 2007 |
(Unaudited) (Unaudited) (Audited)* |
ASSETS |
Current assets: |
Cash and cash equivalents 6,011 12,264 7,325 |
Current portion of restricted cash - 900 900 |
Accounts receivable, net 17,540 18,505 17,704 |
Inventories 15,112 15,599 13,270 |
Prepaid expenses and other current |
assets 5,138 6,679 5,171 |
Total current assets 43,801 53,947 44,370 |
Restricted cash - - 900 |
Property, plant & equipment, net 62,252 65,774 79,582 |
Deferred charges, net 6,367 6,980 5,277 |
Other non-current assets 6,223 5,761 5,008 |
Total assets 118,643 132,462 135,137 |
LIABILITIES AND SHAREHOLDERS' DEFICIT |
Current liabilities: |
Short-term bank facilities 9,392 9,269 3,837 |
Accounts payable 27,908 29,005 25,926 |
Accrued liabilities and other payable 21,315 23,690 22,445 |
Amount due to QPL 3,461 4,312 2,532 |
Current portion of capital lease |
obligations 26 1,596 1,822 |
Total current liabilities 62,102 67,872 56,562 |
Other payable, net of current portion - - 2,086 |
Purchase money loan 9,449 9,323 8,249 |
9.25% senior notes due 2011 150,000 150,000 150,000 |
Capital lease obligations, net of |
current portion 44 48 758 |
Total liabilities 221,595 227,243 217,655 |
Series A Redeemable Convertible |
Preferred Shares 7,303 6,870 5,743 |
Shareholders' deficit: |
Common stock 7,664 7,382 7,114 |
Less: Repurchase of shares at par (71) (71) (71) |
Additional paid-in capital 248,142 248,259 246,072 |
Accumulated deficits (365,867) (357,080) (341,192) |
Accumulated other comprehensive loss (123) (141) (184) |
Total shareholders' deficit (110,255) (101,651) (88,261) |
Total liabilities and shareholders' |
deficit 118,643 132,462 135,137 |
ASAT Holdings Limited |
Condensed Consolidated Statements of Cash Flows |
(USD in thousands) |
For the three months ended April 30, 2008, |
January 31, 2008 and April 30, 2007, and |
For the year ended April 30, 2008 |
and April 30, 2007 |
Three Months Ended Year Ended |
April January April April April |
30, 31, 30, 30, 30, |
2008 2008 2007 2008 2007 |
(Unau- (Unau- (Unau- (Unau- |
dited) dited) dited) dited) (Audited)* |
Operating |
activities: |
Net loss (8,787) (4,950) (10,986) (24,675) (35,040) |
Adjustments |
to reconcile |
net loss to |
net cash |
provided by |
operating |
activities: |
Depreciation and |
amortization: |
Property, plant and |
equipment 5,284 5,428 5,708 22,004 23,328 |
Deferred charges |
and debt discount 739 773 858 3,245 3,705 |
Loss on disposal of |
property, plant and |
equipment 53 - 173 - 173 |
Unrealized foreign |
exchange loss 567 205 - 899 - |
Amortization of stock- |
based compensation 598 75 169 1,044 888 |
Changes in operating assets and |
liabilities: |
Accounts receivable, net 965 532 2,162 164 11,903 |
Restricted cash 900 - 1,520 1,800 1,520 |
Inventories 486 442 1,974 (1,728) 9,939 |
Prepaid expenses and other |
current assets (29) (358) (347) (1,537) 2,913 |
Other non-current assets (462) (615) 49 (1,215) (738) |
Accounts payable (2,013) (147) 305 5,063 (5,728) |
Accrued liabilities |
and other payable (2,375) 994 (2,606) (3,216) 834 |
Amount due to QPL (851) 1,138 (222) 929 (3,294) |
Net cash (used in) |
provided by operating |
activities (4,925) 3,517 (1,243) 2,777 10,403 |
Investing activities: |
Proceeds from disposal of |
property, plant and |
equipment 700 - 146 771 181 |
Acquisition of property, |
plant and equipment (2,036) (2,518) (3,533) (9,073) (17,748) |
Net cash used in |
investing |
activities (1,336) (2,518) (3,387) (8,302) (17,567) |
Financing activities: |
Proceeds from warrant and |
preferred shares |
exercised - - - 1 - |
Repayment of short-term |
bank loan (3,390) (2,156) (5,546) - |
Proceeds from draw |
down of new loan 3,390 7,256 1,304 10,646 3,837 |
Repayment of capital lease |
obligations (4) (76) (443) (940) (2,010) |
Proceeds from stock options |
exercised - - - - 218 |
Proceeds from right |
offering - - - - 490 |
Net cash (used in) |
provided by financing |
activities (4) 5,024 861 4,161 2,535 |
Net (decrease) increase |
in cash and cash |
equivalents (6,265) 6,023 (3,769) (1,364) (4,629) |
Cash and cash equivalents |
at beginning of period 12,264 6,237 11,072 7,325 11,915 |
Effects of foreign exchange |
rates change 12 4 22 50 39 |
Cash and cash equivalents at |
end of period 6,011 12,264 7,325 6,011 7,325 |
Supplemental disclosure of cash |
flow information: |
Cash paid during the period |
for: |
Interest expense 7,129 185 7,014 14,503 14,211 |
Income taxes 289 282 102 877 102 |
* Extracted from the audited financial statements |
CONTACT: Jim Fanucchi of Summit IR Group Inc., +1-408-404-5400, ir@asat.com , for ASAT Holdings Limited
Web site: http://www.asat.com/
SOURCE ASAT Holdings Limited
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