Siliconware Precision Industries Co Ltd (SPIL, 矽品精密), the world’s third-largest chip packager and tester, on Friday reported a 47 percent annual decline in net profit for last quarter, eroded by a spike in financial liabilities.
Net profit plummeted to NT$1.49 billion (US$51.2 million) in the final quarter of last year, from NT$2.83 billion a year earlier.
On a quarterly basis, net profit dipped 34 percent from NT$2.26 billion.
Earnings per share were NT$0.48 in the quarter, the company said in a statement.
The poor performance was due to declining revenue last quarter amid falling prices, a strong New Taiwan dollar and a weaker product mix, SPIL said, adding that a loss of NT$463 million in the fair-value adjustment of its convertible bonds also squeezed its profits.
A 3.82 percent rally in its stock price in the fourth quarter of last year boosted the value of its convertible bonds, or the debt, which led to the fair-value change of financial liabilities, SPIL said.
The company said it consequently saw declines in both its gross margin and operating margin last quarter, with its gross margin falling from 23.6 percent a year earlier and 21.9 percent a quarter earlier to 20.7 percent, and its operating margin falling from 13.7 a year earlier and 12.5 percent a quarter earlier to 10.7 percent.
For the whole of last year, net profit dipped 30.5 percent to NT$6.9 billion, compared with NT$9.93 billion in 2016, hitting the lowest level in four years, SPIL said, adding that earnings per share dropped from NT$3.19 in 2016 to NT$2.11 last year.
Its gross margin last year fell from 22.7 percent in 2016 to 20.1 percent and its operating margin fell from 12.6 percent to 10.4 percent, while total revenue shrank 1.81 percent year-on-year from NT$85.11 billion to NT$83.55 billion, the company said.
SPIL last year allocated NT$12.93 billion for capital expenditure, but the company said it plans to spend more this year to expand capacity and its research and development capability, after its board approved a capital expenditure budget of NT$19.2 billion on Dec. 20 last year.
Separately, SPIL on Tuesday said that trading of its shares would be terminated on April 17 on both the Taiwan Stock Exchange and NASDAQ Composite if shareholders approve a share exchange agreement with Advanced Semiconductor Engineering Inc (ASE, 日月光半導體) during an extraordinary general meeting on Feb. 12.
SPIL shareholders would be paid NT$51.2 per share and their approval would pave the way for its merger with ASE later this year, the company said.
Once the share exchange is completed, SPIL would become a subsidiary of a newly formed ASE Industrial Holding Co (日月光投資控股), the company said, adding that ASE would also become a subsidiary of the holding company and its shares would be delisted from the local stock market as well.
The holding company is expected to launch a stock listing on April 30 on both exchanges, SPIL said.
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