ChipMOS TECHNOLOGIES [NASDAQ: IMOS] Investor Update May, 2013

Transcription

1 ChipMOS TECHNOLOGIES [NASDAQ: IMOS] Investor Update May, 213

2 Safe Harbor Notice Certain statements contained in this presentation may be viewed as forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual performance, financial condition or results of operations of the Company to be materially different from any future performance, financial condition or results of operations implied by such forward- looking statements. Further information regarding these risks, uncertainties and other factors is included in the Company most recent Annual Report on Form 2-F filed with the U.S. Securities and Exchange Commission (the SEC ) and in the Company s other filings with the SEC. Financial figures contained in this presentation have been converted from NT$ to US$ using an exchange rate of US$1. = NT$29.81 as of March 29,

3 ChipMOS - Leader in Outsourced Semiconductor Assembly and Testing (OSAT) ChipMOS is uniquely positioned to take advantage of the ever-changing dynamics and technological advances in the industry 1 Leadership Position in OSAT Market 2 Key Player in Rapidly Growing LCD Outsourcing Market 3 Robust Technology Roadmap with Multiple Growth Vectors 4 Seasoned Management Team with Deep Industry Experience 5 Strong Revenue Growth and Attractive Margins 6 Healthy Balance Sheet with Strong Cash Flow Generation 7 Strong Dedication to Drive Shareholder Value 3

4 Operations Overview Overview Headquarters: Hsinchu, Taiwan Ticker Symbol: NASDAQ: IMOS Market Cap (1) : US$48.8MM Cash/Cash Equivalents (2) : US$31.4MM Employees (2) : 5,626 Manufacturing Footprint in China & Taiwan Shanghai, China ChipMOS Shanghai Hsinchu, Taiwan ChipMOS Taiwan & ThaiLin Tainan, Taiwan ChipMOS Taiwan Memory LCD Driver Gold & Cu Bumping, Mixed-Signal Testing Assembly Testing & Assembly Testing Assembly Taiwan Shanghai ThaiLin (1) As of May 15, 213 (2) As of March 31, 213 4

5 Our History and Key Milestones % of Revenue from Commodity DRAM 1% 5% Listing Taiwan subsidiary onto local exchange market Set up 12 Gold Bumping, Cu Pillar & MCB Bumping and WLCSP line 16% 13% Acquired LCD assets of SiliconWare (SPIL) SPIL becomes a strategic shareholder of ChipMOS Acquired 1% of ChipMOS Taiwan 22 Set up Shanghai subsidiary Acquired Chantek & ThaiLin 21 Became the first Taiwanese semiconductor testing and packaging company listed on the Nasdaq exchange 2 Started TCP package for LCD driver semiconductor and 12" wafer assembly and testing business 1997 Founded in

6 High-Growth End-Market Focus Focus on specialty end markets Leading-edge turn-key solutions for high-growth applications Focused core technology drives innovation and cost-savings for customers ChipMOS Core Technology Revenue Breakdown for Q1, 213 Logic/Mixed-Signal By Manufacturing Segments By Products LCD Driver Core Technology DRAM LCD Driver 23.8% Bumping 19.4% Package Test 16.4% Assembly 31.6% Wafer Sort 8.8% LCD Driver 23.8% Bumping 19.4% Logic/Mixed Signal 7.5% SRAM 2.1% Niche DRAM 16.1% Flash 17.9% Commodity DRAM 13.2% Flash (NOR/NAND) 6

7 Full Service Provider in Key End Markets Offer turn-key solutions for core technology product segments Dedicated OSAT capacity and strategically focused on collaboration-driven growth Leverage current partnerships to capture new customers Targeting mixed-signal and MEMS for expansion Services Provided Bumping /RDL Wafer Testing Assembly/Packaging Product Testing Key End Markets Product Offering LCD Driver u u u u Flash u u u u DRAM Under Development u u u Logic/Mixed Signal u u u u 7

8 Increased Outsourcing and Consolidation Favor ChipMOS IDMs have been accelerating outsourcing back-end testing and assembly processes to OSAT at an increasing rate OSATs historically serviced overflow capacity from IDMs, foundries and fabless design houses Recent consolidation in the OSAT industry has resulted in fewer competitors in our target markets, such as gold bumping and TCP/COF (US$ in Billion) OSAT Market Revenue Forecast Worldwide Total Packaging and Test Revenue CAGR E: 7.8% Outsourcing Revenue (OSAT) CAGR E: 6.% Outsourcing Rate % 49.9% 51.1% 51.8% 53.% 53.2% 43.4% 43.5% 44.2% 45.2% A 27A 28A 29A 21A 211A 212E 213E 214E 215E Gold Bumping Gold Bumping & TCP/COF Industry Consolidation MEGIC MEGIC AMCT % 9% 8% 7% 6% 5% 4% 3% 2% 1% % Year TCP/COF WAE Acquired by ChipMOS Source: Gartner 8

9 Business Strategy Drives Higher Margins and Customer Engagement Consistent and superior EBITDA margins Efficiency in scale and diversification allows efficient use of various equipment => high utilization % Limited competition allows for better price/margin protection and cost rationalization Efficient management of capital allocation and product mix shift to improve utilization rates and margins Deep customer relationships with leading IDMs and semiconductor companies in core business areas We are aligning our technology roadmap with customers and expanding capacity accordingly 4.% 35.% 3.% 25.% 2.% 15.% 1.% 5.%.% EBITDA Margin Trends (21-212) (1)(2)(3) ChipMOS OSAT Players Memory Players LCDD Players 34.4% 32.1% 3.1% 13.9% 33.7% 31.6% 28.2% 28.4% 17.8% 11.6% 12.5% 11.2% Selected Top Customers (1) ASE, Amkor, Chipbond, Powertech and SPIL (2) Hynix, Macronix, Micron, Nanya, Powerchip, Sandisk, Spansion and Winbond (3) Himax, Ilitek, MagnaChip, Novatek, Raydium, Renesas and ROHM 9

10 Industry Dynamics Drive Strong LCD Products Demand Bigger Screen Development of LCD Applications Past 19 Present 46 Wider Applications Touch Screen Module Revenue Forecast (US$ in Billion) 35 CAGR=27.4% A 211A 212E 213E 214E 215E 216E LCD driver IC market driven by strong consumer demand in LCD TV and display devices Wider applications of LCD in electronic products High resolution and function integration Digital broadcasting makes people go to LCD TV The small/medium-size driver IC market has been strongly driven by: Larger screen size Higher definition requirements Touch screen features for smartphone displays Total touch screen module revenue will reach $16 billion in 212 and grow at a CAGR of 27.4% till 216 Source: Display Search 1

11 Significant Presence in the Rapidly Growing LCD Market ChipMOS now is one of two major players in the LCD bumping and test/assembly market Poised to gain more market share as industry consolidation continues with few established players High technological and scale barrier to potential entrants Focused investment in expanding capacity and technological advancement Continuing to expand 12 capacity ChipMOS LCDD Sales (29 - Q1 13) (US$ in Million) Q1'12 Q1'13 ChipMOS LCDD Capacity (29 - Q1 13) Yield of COF/COG > 99% Technology developments in display driver can be leveraged to be used in mixed signal, MEMs product areas (Million Unit) 2,5 2, 1,5 1, , 5 1, , , Q1'12 Q1'13 11

12 Future Technology Roadmap Currently building out capacity to capture market share for high-performance products used in growing end markets, such as smartphones, tablets and highresolution display screens Fine pitch 12 wafers for LCD driver Flip chip for memory and mixed-signal products WLCSP/RDL for E-compass / Magnetometer and NOR products High-margin integrated packages such as stacked-die, multi-chip, SiP packages, etc. Technology Roadmap 12" LCDD 12" Copper Plating Wafer Level Chip Scale Packaging Low Density NOR E - Compass / AKM Magnetometer Logic / Mixed - Signal SiP Stud Bump FC BGA Flip Chip Assembly FC QFN FC (Pillar) CSP

13 Expansive IP Portfolio Actively growing a global intellectual property bank to safeguard technology Customer collaboration strategy enhances technological innovation and patent development platform Utilizing a patent monetization plan to derive value from non-core processes Patent Portfolio Growth by Year FY '6 FY '7 FY '8 FY '9 FY '1 FY '11 FY '12 Taiwan China United States (1) Total patents count includes3 patents held outside of either Taiwan, China or the United States 13

14 Our Long-Term Business Strategy and Outlook Disciplined Financial Management - Controlled capex spend - Efficient utilization of FCF to improve capital structure - Cash dividends to shareholders Financial Business Continue Growth Strategy - LCD Driver - MEMS - Mixed-signal - Specialty memory Improve Operational Efficiency - Leverage different technologies efficiently across various applications Operational Technology Maintain Technological Edge - Focus on advanced technological innovation and migration => 12 and copper capabilities 14

15 Management Team with Deep Industry Experience Shih-Jye (SJ) CHENG Chairman & CEO 28 Years of industry experience Former head of the back-end operation of Mosel Former Chairman of Chantek Former Chairman of AMCT Former Director of Ultima Electronics Corp Business Administration MS from Saginaw Valley State University Dr. Shou-Kang (SK) CHEN - CFO 24 Years of industry experience IR officer, head of the finance division, and former head of strategy development, and head of the quality lab in the firm Mining and petroleum engineering BS, Ph.D. and M.S. from the School of Mining, Metallurgy, Material Science of National Cheng Kung University Li-Chun LI COO 3 Years of industry experience Former VP of the product engineering group of Mosel and ProMOS Former VP of product development of Mosel Electrical Engineering BS from the University of California, Berkeley Dr. David WANG VP of Strategy & IR 3 Years of industry experience Former VP of Fibera Former Senior Director at Lam Research Former IBM's Microelectronics Senior Engineer/ Manager M.S. Ph.D from the University of Michigan and Science BS from Fu Jen University Lafair CHO President of ThaiLin Steve CHENG President of U.S. Carl LEI President of Shanghai 19 Years of industry experience Former VP of ThaiLin Former VP of the memory production, deputy assistant VP of the IC testing of ChipMOS Former manager of production material control of Mosel Industrial Management MS from National Cheng Kung University 13 Years of industry experience Former Finance and Administration Director of ChipMOS U.S.A. Business Banking and Insurance BS from Feng Chia University 18 Years of industry experience Former deputy director of Backend Operation of ProMOS Former product manager of Mosel Bachelor's degree from Feng Chia University 15

16 Financial Highlights 16

17 Strong Growth and Attractive Margins Revenue EBITDA (US$ in Million) Utilization Rate Q1'12 Q1'13 (US$ In Million) (1) Q1'12 Q1'13 EBITDA Margin 9% 8% 7% 6% 5% 4% 3% 2% 1% % 53.% 73.6% 74.7% 76.% 73.2% 75.3% Q1'12 Q1'13 4% 3% 2% 1% % 32.1% 33.7% 31.6% 29.5% 3.7% 11.7% Q1'12 Q1'13 (1) Excluded recovery of allowance of doubtful receivables of US$91.1 million and sales of damage claim of US$35.2 million. (2) The financial information of were prepared in accordance with the US GAAP and those of were prepared in accordance with the IFRSs. 17

18 Financial Snapshot Income Statement Q4 212 Q1 213 Net Revenue (US$ MM) $163.3 $148.3 Gross Margin (%) 15.8% 13.9% Expenses: SG&A (US$ MM) $6.1 $5.5 R&D (US$ MM) $4.1 $4.1 EBITDA (US$ MM) $48.5 $45.5 EPS (US$) - diluted $.25 $.41 EPS (US$) - basic $.26 $.42 18

19 Optimal Use of Capital Drives Healthy Balance Sheet (US$ In Million) (61.6) Free Cash Flow (1) Q1'12 Q1'13 (US$ In Million) CAPEX Q1'12 Q1'13 (US$ In Million) Debt / Cash debt cash /31/29 12/31/21 12/31/211 12/31/212 3/31/212 3/31/213 (1) Excluded recovery of allowance of doubtful receivables of US$91.1 million and sales of damage claim of US$35.2 million. (2) The financial information of were prepared in accordance with the US GAAP and those of were prepared in accordance with the IFRSs. 19

20 Business Outlook (as of May 16, 213) The Company expects 2Q13 revenue to be increased by approximately 1% to 14%, as compared to 1Q13. ChipMOS continues to expect that 1Q13 revenue will be the trough for the year, followed by sequential growth in each quarter of 213, with FY13 revenue coming in higher than FY12. The Company expects 2Q13 gross margin on a consolidated basis to be in the range of approximately 14% to 18%. The Company anticipates depreciation and amortization expenses for 2Q13 to be approximately US$29 million. Operating expenses are expected to be approximately 6% to 7% of revenues in 2Q13. The Company projects CapEx spending to be approximately US$32 million in 2Q13, with CapEx spending for the full year 213 to be approximately US$1 million. Common shares at the end of 2Q13 are expected to be approximately 29 million. 2