Siliconware Precision Industries Reports a 5.1% Quarter-over-Quarter Decline in Revenues Resulting in Earnings per Share of NT$ 0.36 or Earnings per ADS of US$ 0.06 for Fourth Quarter 2010

TAICHUNG, Jan. 26, 2011 /PRNewswire-Asia-FirstCall/ -- Siliconware Precision Industries Co., Ltd. ("SPIL" or the "Company") (Taiwan Stock Exchange: 2325; Nasdaq: SPIL) today announced that its consolidated sales revenues for the fourth quarter of 2010 were NT$15,479 million, which represented a 5.1% decline in revenues compared to the third quarter of 2010 and a 11.7% decline in revenues compared to the fourth quarter of 2009. SPIL reported a net income of NT$1,114 million for the fourth quarter of 2010, compared with a net income of NT$1,490 million and a net income of NT$4,303 million for the third quarter of 2010 and the fourth quarter of 2009, respectively.

Diluted earnings per ordinary share for this quarter was NT$0.36, and diluted earnings per ADS was US$0.06.

All figures were prepared in accordance with R.O.C. GAAP on a consolidated basis.

Operating results review:

• For the fourth quarter of 2010, net revenues from IC packaging were NT$14,098 million and represented 91% of total net revenues. Net revenues from testing operations were NT$1,381 million and represented 9% of total net revenues.
• Cost of goods sold was NT$13,272 million, representing a decrease of 5.1% compared to the third quarter of 2010 and a decrease of 5.2% compared to the fourth quarter of 2009.
  • Raw materials costs were NT$7,295 million for the fourth quarter of 2010, and represented 47.1% of total net revenues, whereas raw materials costs were NT$7,941 million and represented 48.7% of total net revenues for the third quarter of 2010.
  • The accrued expenses of bonuses to employees accounted for under cost of goods sold totaled NT$87 million.   
• Gross profit was NT$2,207 million for the fourth quarter of 2010, representing a gross margin of 14.3%, which increased from a gross margin of 14.2% for the third quarter of 2010 and was down from 20.1% for the fourth quarter of 2009.   
• Total operating expenses for the fourth quarter of 2010 were NT$985 million, which included selling expenses of NT$157 million, administrative expenses of NT$408 million and R&D expenses of NT$420 million. Total operating expenses represented 6.4% of total net revenues for the fourth quarter of 2010.
  • The accrued expenses of bonuses to employees, directors and supervisors accounted for under operating expenses totaled NT$33 million. 
• Operating income was NT$1,222 million for the fourth quarter of 2010, representing an operating margin of 7.9%, which decreased from 9.6% for the third quarter of 2010 and decreased from 14.6% for the fourth quarter of 2009.
• Non-operating items:
  • Our net currency exchange loss of NT$46 million for the fourth quarter of 2010 was mainly due to depreciation of our US dollar denominated asset as a result of a depreciation in the foreign currency exchange rate of the US dollar against NT dollar, our reporting currency.  
• Net income before tax was NT$1,194 million for the fourth quarter of 2010, which decreased from a net income before tax of NT$1,479 million for the third quarter of 2010 and decreased from a net income before tax of NT$4,640 million for the fourth quarter of 2009.
• Income tax expense was NT$80 million for the fourth quarter of 2010, compared with income tax credit of NT$11 million for the third quarter of 2010 and income tax expense of NT$338 million for the fourth quarter of 2009.
• Net income was NT$1,114 million for the fourth quarter of 2010, which decreased from a net income of NT$1,490 million for the third quarter of 2010 and decreased from a net income of NT$4,303 million for the fourth quarter of 2009.
• Total number of shares outstanding was 3,133 million shares as of Dec 31,2010. Diluted earnings per ordinary share for this quarter was NT$0.36, or US$0.06 per ADS. 

Capital expenditure and balance sheet highlight:

• Our cash balances totaled NT$15,519 million as of Dec 31, 2010 from NT$11,820 million as of Sept 30, 2010, and NT$19,615 million as of Dec 31, 2009. 
• Capital expenditures for the fourth quarter of 2010 totaled NT$5,127 million, which included NT$3,757 million for packaging equipment and NT$1,370 million for testing equipment.
• Total depreciation expenses for the fourth quarter of 2010 totaled NT$2,241 million, which included NT$1,736 million was from packaging operations and NT$505 million from testing operations.

IC packaging service:

• Net revenues from IC packaging operations were NT$14,098 million for the fourth quarter of 2010, which represented a decrease of NT$843 million or 5.6% compared to the third quarter of 2010.
• Substrate-based packaging, leadframe-based packaging and wafer bumping & FCBGA accounted for 43%, 27% and 21%, respectively, of total net revenues for the fourth quarter of 2010.
• Capital expenditures for IC packaging operations totaled NT$3,757 million for the fourth quarter of 2010, which included NT$3,579 million for packaging and building construction and NT$178 million for wafer bumping operations.
• As of Dec 31, 2010 we had 6,089 wirebonders installed, of which 142 were added and 370 were disposed in the fourth quarter of 2010.

IC testing service:  

• Net revenues from testing operations were NT$1,381 million for the fourth quarter of 2010, which represented an increase of NT$19 million or 1.4% compared to the third quarter of 2010.
• Capital expenditures for testing operations totaled NT$1,370 million for the fourth quarter of 2010.
• As of Dec 31, 2010 we had 319 testers installed, of which 12 were added and 4 were disposed in the fourth quarter of 2010.

Revenue Analysis

• Breakdown by end applications:

• Breakdown by packaging type:

About SPIL

Siliconware Precision Industries Ltd. ("SPIL")(Nasdaq: SPIL, Taiwan Stock Exchange:2325) is a leading provider of comprehensive semiconductor assembly and test services. SPIL is dedicated to meeting all of its customers' integrated circuit packaging and testing requirements, with turnkey solutions that range from design consultations, modeling and simulations, wafer bumping, wafer probe and sort, package assembly, final test, burn-in, to shipment. Products include advanced leadframe, substrate packages, wafer bumping and FCBGA, which are widely used in personal computers, communications, Internet appliances, cellular phones, digital cameras, cable modems, personal digital assistants and LCD monitors. SPIL supplies services and support to fabless design houses, integrated device manufacturers and wafer foundries globally. For further information, visit SPIL's web site at www.spil.com.tw.

Safe Harbor Statement

The information herein contains forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. We have based these forward-looking statements on our current expectation and projections about future events. Such forward-looking statements are inherently subject to known and unknown risks, uncertainties, assumptions about us and other factors that may cause the actual performance, financial condition or results of operations of SPIL to be materially different from what may be implied by such forward-looking statements. Investors are cautioned that actual events and results could differ materially from those statements as a result of a number of factors, including, among other things:

• the intensely competitive personal computer, communications, consumer ICs and non-commodity memory semiconductor industries and markets;
• cyclical nature of the semiconductor industry;
• risks associated with global business activities;
• non-operating losses due to poor financial performance of some of our investments;
• our dependence on key personnel;
• general economic and political conditions;
• possible disruptions in commercial activities caused by natural and human induced disaster, including terrorist activities and armed conflicts and contagious disease, such as the Severe Acute Respiratory Syndrome;
• fluctuations in foreign currency exchange rates; and
• other risks identified in our annual reports on Form 20-F filed with the U.S. Securities and Exchange Commission each year.

The words "anticipate," "believe," "estimate," "expect," "intend," "plan" and similar expressions, as they relate to us, are intended to identify a number of these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.  In light of these risks, uncertainties and assumptions, the forward-looking events discussed herein might not occur and our actual results could differ materially from those anticipated in these forward-looking statements.

All financial figures discussed herein are prepared pursuant to ROC GAAP on an unaudited consolidated basis. Audited consolidated financial figures will be publicly announced upon the completion of our audit process. The investment gains or losses of our company for the three months ended Dec 31, 2010 reflect our gains or losses attributable to the fourth quarter of 2010 unaudited financial results of several of our investees which are evaluated under the equity method. Neither the unaudited consolidated financial data for our company for the three months ended Dec 31, 2010, nor the unaudited unconsolidated financial data for our company is necessarily indicative of the results that may be expected for any period thereafter.

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