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Asat Holdings Ltd · 6-K · For 12/10/02

Filed On 12/10/02 9:13am ET   ·   SEC File 0-30842   ·   Accession Number 1021408-2-15039

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  As Of               Filer                 Filing     As/For/On Docs:Pgs              Issuer               Agent

12/10/02  Asat Holdings Ltd                 6-K        12/10/02    1:24                                     Donnell..Financial/NY/FA

Report of a Foreign Private Issuer   ·   Form 6-K
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 1: 6-K         Report of a Foreign Private Issuer                  HTML    182K

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  Form 6-K  
 
 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 6-K
 
Report of Foreign Issuer
 
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
 
For the Quarter Ended October 31, 2002
 
 
ASAT Holdings Limited
(Exact name of Registrant as specified in its Charter)
 
14th Floor
138 Texaco Road
Tsuen Wan, New Territories
Hong Kong
(Address of Principal Executive Offices)
 
 
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
 
Form 20-F  x                                Form 40-F
 
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
 
Yes  ¨                                                  No  x
 
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-                .
 

 
This report on Form 6-K consists of (i) a press release reporting the financial results for the second quarter of fiscal year 2003, ended October 31, 2002; (ii) a press release dated November 14, 2002 reporting the appointment of Jeffrey M. Dumas as senior vice president and general counsel; (iii) a press release dated November 25, 2002 reporting ASAT’s officers’ and directors’ intent to purchase stock; and (iv) a press release dated December 9, 2002 reporting the appointment of Robert J. Gange as senior vice president and chief financial officer.

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ASAT Holdings Ltd. Reports 16 Percent Sequential
Revenue Growth in Fiscal Q2 2003
 
Achieves Third Consecutive Quarter of Double-Digit Revenue Increases;
Significantly Improves EBITDA
 
HONG KONG and FREMONT, Calif. – Nov. 19, 2002 – ASAT Holdings Limited (Nasdaq: ASTT), a global provider of semiconductor package design, assembly and test, today announced financial results for its second quarter of fiscal 2003, ended Oct. 31, 2002.
 
Second quarter net revenues were $40.7 million, up 16.0 percent from $35.1 million reported in the first quarter of fiscal 2003, and up 50.2 percent from $27.1 million in revenues reported in the same period a year ago.
 
Net loss in the second quarter was $3.9 million, or a loss of $0.03 per American Depository Share (ADS). This compares with a net loss of $62.4 million, or a net loss of $0.47 per ADS in the first quarter and a net loss of $49.5 million, or a net loss of $0.37 per ADS in the same period a year ago. The first quarter’s net loss included before tax charges of $59.2 million for asset impairment and $3.0 million to write down inventories. Excluding these charges, the net loss was $10.0 million or $0.07 per ADS.
 
EBITDA in the second quarter increased significantly to $5.4 million compared with $804,000 in the first quarter and an EBITDA loss of $5.5 million in the same period a year ago.
 
“We have posted three consecutive quarters of double-digit revenue growth, having successfully executed on our strategy to re-engage former customers, add new customers and broaden our relationships with existing customers,” said Harry R. Rozakis, chief executive officer of ASAT Holdings. “Our corporate financial position continues to improve, with profit margins and EBITDA increasing significantly. The ASAT team is executing on the Peak Performance Initiatives we introduced earlier this year, and our second quarter results demonstrate the benefits of both our aggressive cost reduction programs as well as our ability to increase revenue.
 
“Demand has accelerated for our newer packaging technologies, including the diversified Leadless Plastic Chip Carrier family and chip scale packages, with particular interest coming from wireless communications, power management and consumer markets,” said Mr. Rozakis.
 
The company continued to strengthen its management team by adding Mohan Kirloskar as vice president of applications engineering, design and product development; and John Myers to lead European sales efforts as the new vice president and general manager of ASAT GmbH, ASAT
 
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ASAT Holdings Reports Q2 2003 Financial Results
  
Page 2 of 6
 
Holdings European operations. ASAT also recently announced the appointment of Jeffrey Dumas as senior vice president and corporate counsel.
 
Financial Highlights
Net revenues from assembly services were $37.1 million, an increase of 17.0 percent sequentially; revenues from test services were $3.6 million, an increase of 5.9 percent sequentially. Assembly revenue was 91 percent of total revenue; test revenue was 9 percent of total revenue. The top 10 customers in the second quarter accounted for 78 percent of total revenue compared with 82 percent in the prior quarter.
 
The communications market remained the company’s largest revenue contributor in Q2 at 62 percent of revenues. The consumer segment was 17 percent of revenues, personal computers were 4 percent and the remaining 17 percent was made up of industrial, automotive and other sectors.
 
Gross profit in Q2 was $6.0 million or a gross margin of 14.7 percent. This compares with a gross loss of $3.6 million in Q1 including an inventory charge of $3.0 million. Excluding the charge, the gross loss for Q1 was $573,000.
 
Second quarter SG&A and R&D expenses were $7.2 million, or 17.7 percent of net revenues, compared with $8.5 million, or 24 percent of net revenues in the first quarter. The decrease was attributed to cost reductions as part of ASAT’s Peak Performance Initiatives.
 
Depreciation in the second quarter was $6.6 million compared with $9.8 million in the first quarter. Depreciation decreased by $3.2 million principally as a result of the asset impairment charge taken in the first quarter.
 
Cash at the end of the second quarter was $25.7 million, $1.5 million of which the company set aside in restricted cash as a bank deposit for securing a standby letter of credit associated with our operating lease of a production facility in the People’s Republic of China. Cash available for operations at the end of the second quarter was $24.2 million. Capital expenditures in the quarter were $2.1 million compared with $2.5 million in the first quarter.
 
Assembly utilization rates increased to 67 percent in the second quarter compared with 46 percent in Q1, after the write off of and impairment charges related to certain fixed assets. Test utilization rates were 53 percent compared with 43 percent in Q1.
 
Total headcount at the end of Q2 was approximately 1,320.
 
Outlook and Guidance
In the third quarter of fiscal 2003, ending Jan. 31, 2003, ASAT expects:
 
 
•
 
Revenue to be flat to minus 5 percent
 
•
 
Net loss per ADS of $0.03 to $0.04
 
•
 
EBITDA of $4.0 million to $4.5 million
 
- more -

 
ASAT Holdings Reports Q2 2003 Financial Results
  
Page 3 of 6
 
Second Quarter 2003 Financial Results Conference Call
ASAT Holdings second quarter fiscal 2003 financial results conference call will be held today, Nov. 19, at 8:30 a.m. ET. To participate in the call, dial (312) 470-0008. You will need to reference the pass code: ASAT. A replay of the call will be available starting one hour after the completion of the call until Dec. 3, 2002. To access the replay, please dial (402) 998-1580. A webcast of the conference call will be available at www.asat.com.
 
About ASAT Holdings Limited
ASAT Holdings Limited is a leading global provider of semiconductor package design, assembly and test services. With almost 15 years of experience, the Company offers a broad selection of package types including ball grid array, leadless plastic chip carrier, thin array plastic package and flip chip. ASAT is the first company to develop Moisture Sensitive Level One capability on standard leaded products. The company has operations in the United States, Asia and Europe. ASAT, Inc., exclusive distributor of ASAT Holdings’ services in the United States, is located at 46335 Landing Parkway, Fremont, CA 94538, phone (510) 249-1222, fax (510) 249-9105. For more information, visit www.asat.com.
 
Safe Harbor Statement
This news release contains “forward-looking statements” within the meaning of Section 27A of the United States Securities Act of 1933 and Section 21E of the United States Exchange Act of 1934. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause the actual performance, financial condition or results of operations of ASAT Holdings to differ materially from any future such matters expressed or implied by the statements. Investors are cautioned that actual events and results could differ materially from these statements as a result of a variety of factors, including conditions in the overall semiconductor market and economy, acceptance and demand for products and services of ASAT Holdings, and technological and development risks. The risks, uncertainties and other factors include, among others, those 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 June 28, 2002. The projections and forward-looking statements in this release reflect the current belief of ASAT Holdings as of this date. ASAT Holdings undertakes no obligation to update these projections and forward-looking statements for events or circumstances that occur after the date of this news release.
 
Contacts:
       
Stan Baumgartner
     
Jim Fanucchi
Chief Financial Officer
     
Stapleton Communications Inc.
Hong Kong
     
Palo Alto, CA
852-2439-8788
     
650-470-4237
stan_baumgartner@asathk.com
     
jim@stapleton.com
 
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ASAT Holdings Reports Q2 2003 Financial Results
  
Page 4 of 6
 
Revenue Breakdown by Market Segment
 
      
Three Months Ended
      
    
Market Segment
     
% of Net Revenues
     
% of Net Revenues
Communications
     
62
     
64
Consumer
     
17
     
15
PC/Computing
     
4
     
3
Industrial, Automotive & Other
     
17
     
18
 
Revenue Breakdown by Region
 
      
Three Months Ended
      
    
Region
     
% of Net Revenues
     
% of Net Revenues
United States
     
78
     
92
Europe
     
20
     
7
Asia
     
2
     
1
 
Revenue Breakdown by Customer Type
 
      
Three Months Ended
      
    
Customer Type
     
% of Net Revenues
     
% of Net Revenues
Fabless
     
44
     
48
IDM
     
56
     
52
 
Summary financial data follows:
 
 
 
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ASAT Holdings Reports Q2 2003 Financial Results
  
Page 5 of 6
 
ASAT Holdings Limited
Consolidated Statements of Operations
(USD in thousands, except share data)
Quarter Ended October 31, 2002, July 31, 2002 and October 31, 2001
 
    
Three Months Ended
     
Six Months Ended
  
    
    
    
    
    
 
    
(Unaudited)
     
(Unaudited)
     
(Unaudited)
     
(Unaudited)
     
(Unaudited)
  
Net Sales
   
 
40,719
 
   
 
35,098
 
   
 
27,052
 
   
 
75,817
 
   
 
52,078
 
Total cost of sales (Note 1)
   
 
34,753
 
   
 
38,678
 
   
 
37,327
 
   
 
73,431
 
   
 
71,145
 
    
  
  
  
  
Gross profit (loss)
   
 
5,966
 
   
 
(3,580
)
   
 
(10,275
)
   
 
2,386
 
   
 
(19,067
)
    
  
  
  
  
Operating expenses:
                                             
Selling, general and administrative
   
 
5,848
 
   
 
6,971
 
   
 
7,712
 
   
 
12,819
 
   
 
15,814
 
Research and development
   
 
1,314
 
   
 
1,500
 
   
 
1,702
 
   
 
2,814
 
   
 
3,242
 
Reorganization expenses
   
 
—  
 
   
 
128
 
   
 
485
 
   
 
128
 
   
 
2,317
 
Impairment of construction in progress (Note 4)
   
 
—  
 
   
 
—  
 
   
 
4,500
 
   
 
—  
 
   
 
4,500
 
Impairment of property, plant and equipment (Note 3)
   
 
—  
 
   
 
59,189
 
   
 
—  
 
   
 
59,189
 
   
 
—  
 
Assets written off in relation to ASAT SA
   
 
—  
 
   
 
—  
 
   
 
24,285
 
   
 
—  
 
   
 
24,285
 
    
  
  
  
  
Total operating expenses
   
 
7,162
 
   
 
67,788
 
   
 
38,684
 
   
 
74,950
 
   
 
50,158
 
    
  
  
  
  
Loss from operations
   
 
(1,196
)
   
 
(71,368
)
   
 
(48,959
)
   
 
(72,564
)
   
 
(69,225
)
Other income, net
   
 
551
 
   
 
351
 
   
 
770
 
   
 
902
 
   
 
1,642
 
Interest expense:
                                             
—  amortization of deferred charges
   
 
(233
)
   
 
(233
)
   
 
(228
)
   
 
(466
)
   
 
(458
)
—  third parties
   
 
(3,293
)
   
 
(2,851
)
   
 
(3,362
)
   
 
(6,144
)
   
 
(6,724
)
    
  
  
  
  
Loss before income taxes
   
 
(4,171
)
   
 
(74,101
)
   
 
(51,779
)
   
 
(78,272
)
   
 
(74,765
)
Income tax benefit
   
 
294
 
   
 
11,671
 
   
 
2,284
 
   
 
11,965
 
   
 
4,932
 
    
  
  
  
  
Net loss
   
 
(3,877
)
   
 
(62,430
)
   
 
(49,495
)
   
 
(66,307
)
   
 
(69,833
)
    
  
  
  
  
EBITDA (Note 2)
   
 
5,439
 
   
 
804
 
   
 
(5,465
)
   
 
6,243
 
   
 
(13,851
)
    
  
  
  
  
Depreciation and amortization
   
 
6,635
 
   
 
9,848
 
   
 
10,224
 
   
 
16,483
 
   
 
20,272
 
    
  
  
  
  
Net loss per ADS:
                                             
Basic:
                                             
Net loss
   
$
(0.03
)
   
$
(0.47
)
   
$
(0.37
)
   
$
(0.50
)
   
$
(0.52
)
    
  
  
  
  
Basic weighted average number of ADS outstanding
   
 
133,789,400
 
   
 
133,789,400
 
   
 
133,862,373
 
   
 
133,789,400
 
   
 
133,895,558
 
    
  
  
  
  
Net loss per ordinary share:
                                             
Basic:
                                             
Net loss
   
$
(0.01
)
   
$
(0.09
)
   
$
(0.07
)
   
$
(0.10
)
   
$
(0.10
)
    
  
  
  
  
Basic weighted average number of ordinary shares outstanding
   
 
668,947,000
 
   
 
668,947,000
 
   
 
669,311,864
 
   
 
668,947,000
 
   
 
669,477,788
 
    
  
  
  
  
 
Note 1:
   
Includes provision for inventory writedown in the amount of $4,000, $3,007 and $270 respectively for the October 2001, July 2002 and October 2002 quarters.
Note 2:
   
EBITDA is defined as Loss from operations plus depreciation and amortization plus specific charges and inventory write-down except inventory write-down for October 2002 quarter. $ 270 inventory write-down in October 2002 quarter were not added back to EBIDTA as those were within normal operations.
Note 3:
   
Represents $59,189 non-cash charge for the write-off and impairment related to cetain property, plant and equipment in the July 2002 quarter.
Note 4:
   
Specific charge incurred for nonrecoverable & unutilized architectural costs related to former China location.

ASAT Holding Reports Q2 2003 Financial Results
  
Page 6 of 6
 
ASAT Holdings Limited
Consolidated Balance Sheets (Unaudited)
(USD in thousands)
As at October 31, 2002, July 31, 2002 and October 31, 2001
 
    
    
    
 
ASSETS
                     
Current assets:
                     
Cash and cash equivalents
   
24,160
 
   
31,732
 
   
52,700
 
Accounts receivable, net
   
23,164
 
   
17,362
 
   
11,536
 
Inventories
   
9,644
 
   
7,964
 
   
11,133
 
Prepaid expenses and other current assets
   
5,675
 
   
4,820
 
   
5,419
 
    
  
  
Total current assets
   
62,643
 
   
61,878
 
   
80,788
 
Restricted Cash (Note