Delaware (State of incorporation) | 23-1722724 (I.R.S. Employer Identification Number) |
Title of Each Class | Name of Each Exchange on Which Registered | |||
Common Stock, $0.001 par value | The NASDAQ Global Select Market |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | Emerging growth company o |
(Do not check if a smaller reporting company) |
Page | ||
Item 1. | Business |
• | Designing and developing innovative packaging and test technologies; |
• | Offering a broad portfolio of cost-effective solutions and services; |
• | Focusing on strategic end markets that offer solid growth potential; |
• | Cultivating long-standing relationships with our customers, which include many of the world’s leading semiconductor companies; |
• | Collaborating with customers, original equipment manufacturers (“OEMs”) and equipment and material suppliers; |
• | Developing a competitive cost structure with disciplined capital investment; |
• | Building expertise in high-volume manufacturing processes and developing a reputation for high quality and solid execution and |
• | Providing a geographically diverse operating base, with research and development, engineering support and production capabilities at various facilities in China, Japan, Korea, Malaysia, the Philippines, Portugal and Taiwan. |
• | An increasing demand for mobile and internet-connected devices, including the world-wide adoption of “smart” phones, tablets and other consumer electronic devices that can access the internet and provide multimedia capabilities. |
• | An increase in mobility and connectivity capabilities and growing digital content driving demand for new broadband wired and wireless networking equipment. |
• | The proliferation of semiconductor devices into well-established end products such as automotive systems due to increased use of electronics for safety, navigation, fuel efficiency, emission reduction and entertainment systems. |
• | An overall increase in the semiconductor content within electronic products to provide greater functionality and higher levels of performance. |
• | The growth of advanced System-in-Package ("SiP") modules where multiple semiconductor and other electronic components with different functionalities are combined into a single package. The increasing demand for miniaturization and higher functionality at competitive cost is driving the adoption of advanced SiP in new products. Advanced SiPs are the primary vehicle for package-level integration, which allow customers to combine ICs from different silicon nodes and different foundries. |
• | First, we are increasing our revenue in markets other than smartphones and tablets, such as automotive, which now drives approximately 26% of Amkor's total revenue. Revenue from these markets tends to be more stable, with less pronounced highs and lows from year to year. Sales in these other markets now account for 57% of our overall revenue, up from 47% in 2015, prior to the acquisition of J-Devices. |
• | Second, we are expanding our customer base in the smartphone and tablet market, primarily by engaging with fabless companies in Greater China. This allows us to more fully utilize our existing assets and broadens our participation in all tiers of the mobile device market. |
• | Third, we continue to make share gains in the iOS and high-end Android ecosystems, leveraging our expertise in advanced SiP, MEMS and other advanced packages to expand our content in flagship phones. |
• | Finally, we are focused on building and utilizing manufacturing lines which support multiple customers, and increasing factory utilization through more sophisticated planning processes and more intensive efficiency improvement activities. |
• | Offering capacity to absorb large orders and accommodate quick turn-around times; |
• | Obtaining favorable pricing on materials and equipment, where possible, by using our purchasing power and leading industry position; |
• | Qualifying production of customer devices at multiple manufacturing sites to mitigate the risks of supply disruptions and |
• | Providing capabilities and solutions for customer-specific requirements. |
For the Year Ended December 31, | ||||||||||||||||||||
2017 | 2016 | 2015 | ||||||||||||||||||
(In millions, except percentage of net sales) | ||||||||||||||||||||
Advanced Products | $ | 1,950 | 46.6 | % | $ | 1,680 | 43.1 | % | $ | 1,433 | 49.7 | % | ||||||||
Mainstream Products | 2,236 | 53.4 | % | 2,214 | 56.9 | % | 1,452 | 50.3 | % | |||||||||||
Total net sales | $ | 4,186 | 100.0 | % | $ | 3,894 | 100.0 | % | $ | 2,885 | 100.0 | % |
• | Wafer-level CSP packages (also known as fan-in wafer-level packages) do not utilize a package carrier. The bumped wafer is singulated into individual die, and the wafer-level package is then attached directly to the system board. Wafer-level CSP offers one of the lowest total system costs, enabling higher semiconductor content while leveraging the smallest form factor and one of the highest performing, most reliable, semiconductor package platforms on the market today. We have seen significant growth in our wafer-level CSP business, driven largely by mobile communications. Applications for wafer-level CSP include power management, transceivers, sensors, wireless charging, codecs, and specialty silicon for new or unique functionality. |
• | Wafer-level fan-out packages (also known as low-density fan-out packages) are utilized for ICs where the die surface area is too small to accommodate all of the bond pads. The fan-out package enlarges the bondable surface area by building a border around the die using low-cost molding compound. Wafer-level CSP and wafer-level fan-out are complementary technologies. Customers can choose between the two package types as their die sizes shrink or grow. With our recent acquisition of Nanium, we are now a leader in low-density fan-out technology. |
• | Silicon Wafer Integrated Fan-out Technology ("SWIFT", also known as high-density fan-out) replaces a laminate substrate with a thinner structure. SWIFT solutions enable very thin, very small products combining application processors, memory, baseband and other peripheral ICs. |
2017 | 2016 | 2015 | ||||||
End Market Distribution Data (an approximation including representative devices and applications based on a sampling of our largest customers): | ||||||||
Communications (smart phones, tablets, handheld devices) | 43 | % | 42 | % | 53 | % | ||
Automotive, industrial and other (driver assist, infotainment, safety, performance) | 26 | % | 26 | % | 13 | % | ||
Computing (data center, PC/laptops, infrastructure, storage) | 18 | % | 18 | % | 22 | % | ||
Consumer (televisions, set-top boxes, personal electronics) | 13 | % | 14 | % | 12 | % | ||
Total net sales | 100 | % | 100 | % | 100 | % |
• | technical competence; |
• | quality; |
• | price; |
• | breadth of packaging and test services offered, including turnkey services; |
• | new package and test design, technology innovation and implementation; |
• | cycle times; |
• | customer service and |
• | available capacity and ability to invest in capacity, geographic location and scale of manufacturing. |
Item 1A. | Risk Factors |
• | fluctuation in demand for semiconductors and conditions in the semiconductor industry generally, as well as by specific customers, such as inventory reductions by our customers impacting demand in key markets; |
• | our ability to achieve our major growth objectives, including: transitioning second-wave customers to advanced packages; expanding our sales to customers in Greater China and, in particular, in the mid-level and entry-level tiers of the mobile device market; and increasing our share of the automotive market; |
• | changes in our capacity and capacity utilization rates; |
• | changes in average selling prices which can occur quickly due to the absence of long-term agreements on price; |
• | changes in the mix of the semiconductor packaging and test services that we sell; |
• | the development, transition and ramp to high volume manufacture of more advanced silicon nodes and evolving wafer, packaging and test technologies, may cause production delays, lower manufacturing yields and supply constraints for new wafers and other materials; |
• | absence of backlog, the short-term nature of our customers’ commitments, double bookings by customers and deterioration in customer forecasts and the impact of these factors, including the possible delay, rescheduling and cancellation of large orders, or the timing and volume of orders relative to our production capacity; |
• | changes in costs, quality, availability and delivery times of raw materials, components and equipment; |
• | changes in labor costs to perform our services; |
• | wage inflation and fluctuations in commodity prices, including gold, copper and other precious metals; |
• | the timing of expenditures in anticipation of future orders; |
• | changes in effective tax rates; |
• | the availability and cost of financing; |
• | intellectual property transactions and disputes; |
• | high leverage and restrictive covenants; |
• | warranty and product liability claims and the impact of quality excursions and customer disputes and returns; |
• | costs associated with legal claims, indemnification obligations, judgments and settlements; |
• | international events, such as the United Kingdom's vote to leave the European Union, political instability, civil disturbances or environmental or natural events, such as earthquakes like the recent ones in Japan, that impact our operations; |
• | pandemic illnesses that may impact our labor force and our ability to travel; |
• | costs of acquisitions and divestitures and difficulties integrating acquisitions; |
• | our ability to attract and retain qualified personnel to support our global operations; |
• | fluctuations in foreign exchange rates; |
• | fluctuations in our manufacturing yields; |
• | our ability to penetrate new end markets or expand our business in existing end markets; |
• | dependence on key customers or concentration of customers in certain end markets, such as mobile communications and automotive and |
• | restructuring charges, asset write-offs and impairments. |
• | changes in consumer demand resulting from deteriorating conditions in local economies; |
• | regulations and policies imposed by U.S. or foreign governments, such as tariffs, customs, duties and other restrictive trade barriers, antitrust and competition, tax, currency and banking, privacy, labor, environmental, health and safety; |
• | laws, rules, regulations and policies within China and other countries that may favor domestic companies over non-domestic companies, including customer- or government-supported efforts to promote the development and growth of local competitors; |
• | the payment of dividends and other payments by non-U.S. subsidiaries may be subject to prohibitions, limitations or taxes in local jurisdictions; |
• | fluctuations in currency exchange rates, particularly with the recent acquisition of J-Devices; |
• | political and social conditions, and the potential for civil unrest, terrorism or other hostilities; |
• | disruptions or delays in shipments caused by customs brokers or government agencies; |
• | difficulties in attracting and retaining qualified personnel and managing foreign operations, including foreign labor disruptions; |
• | difficulty in enforcing contractual rights and protecting our intellectual property rights; |
• | potentially adverse tax consequences resulting from tax laws in the U.S. and in foreign jurisdictions in which we operate and |
• | local business and cultural factors that differ from our normal standards and practices, including business practices that we are prohibited from engaging in by the Foreign Corrupt Practices Act and other anti-corruption laws and regulations. |
• | their desire to realize higher utilization of their existing packaging and test capacity, especially during downturns in the semiconductor industry; |
• | their unwillingness to disclose proprietary technology; |
• | their possession of more advanced packaging and test technologies and |
• | the guaranteed availability of their own packaging and test capacity. |
• | make it more difficult for us to satisfy our obligations with respect to our indebtedness, including our obligations under our indentures to purchase notes tendered as a result of a change in control of Amkor; |
• | increase our vulnerability to general adverse economic and industry conditions; |
• | limit our ability to fund future working capital, capital expenditures, research and development and other business opportunities, including joint ventures and acquisitions; |
• | require us to dedicate a substantial portion of our cash flow from operations to service payments of interest and principal on our debt, thereby reducing the availability of our cash flow to fund future working capital, capital expenditures, research and development expenditures and other general corporate requirements; |
• | increase the volatility of the price of our common stock; |
• | limit our flexibility to react to changes in our business and the industry in which we operate; |
• | place us at a competitive disadvantage to any of our competitors that have less debt; |
• | limit, along with the financial and other restrictive covenants in our indebtedness, among other things, our ability to borrow additional funds; |
• | limit our ability to refinance our existing indebtedness, particularly during periods of adverse credit market conditions when refinancing indebtedness may not be available under interest rates and other terms acceptable to us or at all and |
• | increase our cost of borrowing. |
• | we may face delays in the design and implementation of the system; |
• | the cost of the systems may exceed our plans and expectations and |
• | disruptions resulting from the implementation or integration of the systems may impact our ability to process transactions and delay shipments to customers, impact our results of operations or financial condition or harm our control environment. |
• | increasing the scope, geographic diversity and complexity of our operations; |
• | conforming an acquired company's standards, practices, systems and controls with our operations; |
• | increasing complexity from combining recent acquisitions of an acquired business; |
• | unexpected losses of key employees or customers of an acquired business; other difficulties in the assimilation of acquired operations, technologies or products and |
• | diversion of management and other resources from other parts of our operations and adverse effects on existing business relationships with customers. |
• | use a significant portion of our available cash; |
• | issue equity securities, which may dilute the ownership of current stockholders; |
• | incur substantial debt; |
• | incur or assume known or unknown contingent liabilities and |
• | incur large, immediate accounting write offs and face antitrust or other regulatory inquiries or actions. |
• | our future financial condition, results of operations and cash flows; |
• | general market conditions for financing; |
• | volatility in fixed income, credit and equity markets and |
• | economic, political and other global conditions. |
• | discontinue the use of certain processes or cease to provide the services at issue, which could curtail our business; |
• | pay substantial damages; |
• | develop non-infringing technologies, which may not be feasible or |
• | acquire licenses to such technology, which may not be available on commercially reasonable terms or at all. |
• | contaminants in the manufacturing environment; |
• | human error; |
• | equipment malfunction; |
• | changing processes to address environmental requirements; |
• | defective raw materials or |
• | defective plating services. |
Item 1B. | Unresolved Staff Comments |
Item 2. | Properties |
Approximate Facility Size (Square Feet) | ||||||||
Owned | Leased | Total | ||||||
China (1) | 1,317,000 | — | 1,317,000 | |||||
Japan | 1,687,000 | 525,000 | 2,212,000 | |||||
Korea | 2,979,000 | — | 2,979,000 | |||||
Malaysia (1) | 385,000 | — | 385,000 | |||||
Philippines (2) | 661,000 | 658,000 | 1,319,000 | |||||
Portugal | 498,000 | — | 498,000 | |||||
Taiwan | 864,000 | — | 864,000 | |||||
Total all facilities | 8,391,000 | 1,183,000 | 9,574,000 |
(1) | Land is leased. |
(2) | As a result of foreign ownership restrictions in the Philippines, the land is leased. A portion of the land we lease is owned by realty companies in which we own a 40% interest. |
Item 3. | Legal Proceedings |
Item 4. | Mine Safety Disclosures |
Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
High | Low | ||||||
2017 | |||||||
First Quarter | $ | 11.59 | $ | 9.41 | |||
Second Quarter | 12.33 | 9.77 | |||||
Third Quarter | 11.06 | 8.38 | |||||
Fourth Quarter | 11.57 | 10.05 | |||||
2016 | |||||||
First Quarter | $ | 6.14 | $ | 4.13 | |||
Second Quarter | 6.44 | 5.37 | |||||
Third Quarter | 9.72 | 5.60 | |||||
Fourth Quarter | 12.32 | 9.19 |
Period | Total Number of Shares Purchased (a) | Average Price Paid Per Share ($) | Total Number of Shares Purchased as part of Publicly Announced Plans or Programs (b) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs ($) (b) | ||||||
October 1-October 31 | — | $ | — | — | $ | 91,586,032 | ||||
November 1-November 30 | 5,750 | 11.39 | — | 91,586,032 | ||||||
December 1-December 31 | — | — | — | 91,586,032 | ||||||
Total | 5,750 | $ | 11.39 | — |
(a) | Represents shares of common stock surrendered to us to satisfy tax withholding obligations associated with the vesting of restricted shares issued to employees. |
(b) | Our Board of Directors previously authorized the repurchase of up to $300.0 million of our common stock, $150.0 million in August 2011 and $150.0 million in February 2012, exclusive of any fees, commissions or other expenses. During 2016 and 2017, we made no common stock purchases, and at December 31, 2017, approximately $91.6 million was available pursuant to the stock repurchase program. |
(1) | The preceding Stock Performance Graph is not deemed filed with the SEC and shall not be incorporated by reference in any of our filings under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing. |
For the Year Ended December 31 | |||||||||||||||||||||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | ||||||||||||||||||
Amkor Technology, Inc. | $ | 100.00 | $ | 144.55 | $ | 167.42 | $ | 143.37 | $ | 248.77 | $ | 236.98 | |||||||||||
S&P 500 | 100.00 | 132.39 | 150.51 | 152.59 | 170.84 | 208.14 | |||||||||||||||||
PHLX Semiconductor | 100.00 | 130.15 | 167.68 | 156.67 | 208.23 | 292.66 |
Item 6. | Selected Financial Data |
For the Year Ended December 31 | |||||||||||||||||||
2017 (f) | 2016 (g) | 2015 (g) | 2014 (e) | 2013 (h) | |||||||||||||||
(In thousands, except per share data) | |||||||||||||||||||
Income Statement Data: | |||||||||||||||||||
Net sales | $ | 4,186,497 | $ | 3,893,635 | $ | 2,884,603 | $ | 3,129,440 | $ | 2,956,450 | |||||||||
Gross profit (a) | 757,273 | 695,477 | 479,265 | 552,822 | 544,513 | ||||||||||||||
Gain on sale of real estate (b) | (108,109 | ) | — | — | — | — | |||||||||||||
Operating income | 401,313 | 293,940 | 164,839 | 221,460 | 232,109 | ||||||||||||||
Loss on debt retirement (c) | 4,835 | — | 9,560 | 757 | 12,330 | ||||||||||||||
Income tax expense (d) | 38,982 | 47,853 | 28,035 | 33,845 | 22,646 | ||||||||||||||
Equity in earnings of J-Devices (e) | — | — | 14,016 | 31,007 | 9,452 | ||||||||||||||
Net income (a) (e) | 264,888 | 167,304 | 53,893 | 133,240 | 110,793 | ||||||||||||||
Net income attributable to Amkor | 260,706 | 164,190 | 51,098 | 129,739 | 108,432 | ||||||||||||||
Net income attributable to Amkor per common share: | |||||||||||||||||||
Basic | $ | 1.09 | $ | 0.69 | $ | 0.22 | $ | 0.56 | $ | 0.58 | |||||||||
Diluted | $ | 1.09 | $ | 0.69 | $ | 0.22 | $ | 0.55 | $ | 0.50 | |||||||||
Other Financial Data: | |||||||||||||||||||
Depreciation and amortization | $ | 581,940 | $ | 555,186 | $ | 494,200 | $ | 464,706 | $ | 410,346 | |||||||||
Payments for property, plant and equipment | 550,943 | 650,038 | 537,975 | 681,120 | 566,256 | ||||||||||||||
Balance Sheet Data: | |||||||||||||||||||
Cash and cash equivalents | $ | 596,364 | $ | 549,518 | $ | 523,172 | $ | 449,946 | $ | 610,442 | |||||||||
Working capital | 289,081 | 404,035 | 299,296 | 497,358 | 541,480 | ||||||||||||||
Total assets | 4,521,509 | 4,092,086 | 4,026,428 | 3,633,918 | 3,426,166 | ||||||||||||||
Non-current liabilities, including debt | 1,468,941 | 1,683,021 | 1,790,708 | 1,803,879 | 1,771,422 | ||||||||||||||
Total Amkor stockholders’ equity | 1,667,328 | 1,383,588 | 1,200,286 | 1,114,748 | 952,608 |
(a) | In January 2015, we reached a resolution to a patent license dispute and entered into a settlement agreement. During 2014 and 2013 we recorded charges of $75.3 million and $10.0 million, respectively, to cost of sales and $13.7 million and $1.8 million, respectively, to interest expense relating to this patent license dispute. |
(b) | In May 2017, we sold the land and buildings comprising our K1 factory for $142.4 million which resulted in a pre-tax gain of $108.1 million |
(c) | In July 2017, we recorded a loss on debt retirement of $4.4 million relating to the partial early repayment of our 6.625% Senior Notes due 2021. During 2015, we recorded a loss on debt retirement of $8.9 million relating to the early repayment of our 7.375% Senior Notes due May 2018. During 2013, we exchanged debt for shares of our common stock and a cash payment and recorded a charge of $11.6 million. |
(d) | In 2017, income tax expense includes an estimated net tax benefit of $41.6 million primarily due to the reversal of a valuation allowance on certain U.S. deferred tax assets as a result of the enactment of the Tax Act. |
(e) | On June 30, 2014, we sold 100% of the shares of our then wholly-owned subsidiary in Japan to J-Devices, our then unconsolidated equity-method joint venture in Japan. Subsequent to June 30, 2014, the results of the divested entity are included in J-Devices' financial results and in our corresponding equity in earnings of J-Devices. We recognized a net gain on the sale of $9.2 million in other (income) expense, net. In addition, J-Devices recognized a gain on the |
(f) | On May 22, 2017, we completed the purchase of Nanium. Their financial results have been included in our Consolidated Financial Statements from the date of acquisition. |
(g) | We increased our investment in J-Devices to 60% in 2013 and to 100% on December 30, 2015 through the exercise of additional options. As a result, our accounting for J-Devices changed from the equity method to the consolidation method effective December 30, 2015. Our balance sheet data as of December 31, 2015 reflects the consolidation of J-Devices. We began consolidating the operating results of J-Devices in 2016. We recognized a net loss of $13.5 million in other (income) expense, net in connection with the acquisition in 2015. The net loss resulted from a loss of $29.6 million related to the release of certain accumulated foreign currency translation adjustments related to J-Devices, offset by a gain of $16.1 million related to the step-up to fair value of our previous investments in J-Devices. |
(h) | On July 31, 2013, we completed the purchase of Amkor Technology Malaysia Sdn. Bhd. Their financial results have been included in our Consolidated Financial Statements from the date of acquisition. |
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
For the Year Ended December 31 | ||||||||
2017 | 2016 | 2015 | ||||||
Net sales | 100.0 | % | 100.0 | % | 100.0 | % | ||
Materials | 36.4 | % | 37.2 | % | 36.6 | % | ||
Labor | 15.6 | % | 15.3 | % | 15.1 | % | ||
Other manufacturing costs | 29.9 | % | 29.6 | % | 31.7 | % | ||
Gross margin | 18.1 | % | 17.9 | % | 16.6 | % | ||
Operating income | 9.6 | % | 7.5 | % | 5.7 | % | ||
Income before income taxes and equity in earnings of unconsolidated affiliate | 7.3 | % | 5.5 | % | 2.4 | % | ||
Net income attributable to Amkor | 6.2 | % | 4.2 | % | 1.8 | % |
Change | |||||||||||||||||||||||||
2017 | 2016 | 2015 | 2017 over 2016 | 2016 over 2015 | |||||||||||||||||||||
(In thousands, except percentages) | |||||||||||||||||||||||||
Net sales | $ | 4,186,497 | $ | 3,893,635 | $ | 2,884,603 | $ | 292,862 | 7.5 | % | $ | 1,009,032 | 35.0 | % |
Change | |||||||||||||||||||
2017 | 2016 | 2015 | 2017 over 2016 | 2016 over 2015 | |||||||||||||||
(In thousands, except percentages) | |||||||||||||||||||
Gross profit | $ | 757,273 | $ | 695,477 | $ | 479,265 | $ | 61,796 | $ | 216,212 | |||||||||
Gross margin | 18.1 | % | 17.9 | % | 16.6 | % | 0.2 | % | 1.3 | % |
Change | |||||||||||||||||||||||||
2017 | 2016 | 2015 | 2017 over 2016 | 2016 over 2015 | |||||||||||||||||||||
(In thousands, except percentages) | |||||||||||||||||||||||||
Selling, general and administrative | $ | 297,455 | $ | 284,331 | $ | 232,409 | $ | 13,124 | 4.6 | % | $ | 51,922 | 22.3 | % |
Change | |||||||||||||||||||||||||
2017 | 2016 | 2015 | 2017 over 2016 | 2016 over 2015 | |||||||||||||||||||||
(In thousands, except percentages) | |||||||||||||||||||||||||
Research and development | $ | 166,614 | $ | 117,206 | $ | 82,017 | $ | 49,408 | 42.2 | % | $ | 35,189 | 42.9 | % |
Change | |||||||||||||||||||||||||
2017 | 2016 | 2015 | 2017 over 2016 | 2016 over 2015 | |||||||||||||||||||||
(In thousands, except percentages) | |||||||||||||||||||||||||
Interest expense, including related party | $ | 85,554 | $ | 84,637 | $ | 86,376 | $ | 917 | 1.1 | % | $ | (1,739 | ) | (2.0 | )% | ||||||||||
Foreign currency (gain) loss, net | 11,823 | (3,592 | ) | (7,849 | ) | 15,415 | >(100)% | 4,257 | (54.2 | )% | |||||||||||||||
Other (income) expense, net | 66 | (2,262 | ) | 18,400 | 2,328 | >100% | (20,662 | ) | >(100)% | ||||||||||||||||
Total other expense, net | $ | 97,443 | $ | 78,783 | $ | 96,927 | $ | 18,660 | 23.7 | % | $ | (18,144 | ) | (18.7 | )% |
Change | |||||||||||||||||||
2017 | 2016 | 2015 | 2017 over 2016 | 2016 over 2015 | |||||||||||||||
(In thousands, except percentages) | |||||||||||||||||||
Income tax expense | $ | 38,982 | $ | 47,853 | $ | 28,035 | $ | (8,871 | ) | $ | 19,818 | ||||||||
Effective tax rate | 12.8 | % | 22.2 | % | 41.3 | % |
For the Year Ended December 31 | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Operating activities | $ | 618,267 | $ | 729,402 | $ | 584,975 | |||||
Investing activities | (454,832 | ) | (589,427 | ) | (514,990 | ) | |||||
Financing activities | (124,886 | ) | (112,179 | ) | 2,613 |
For the Year Ended December 31 | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Net cash provided by operating activities | $ | 618,267 | $ | 729,402 | $ | 584,975 | |||||
Payments for property, plant and equipment | (550,943 | ) | (650,038 | ) | (537,975 | ) | |||||
Proceeds from sale of and insurance recovery for property, plant and equipment | 141,530 | 60,801 | 6,945 | ||||||||
Free cash flow | $ | 208,854 | $ | 140,165 | $ | 53,945 |
Payments Due for Year Ending December 31, | |||||||||||||||||||||||||||
Total | 2018 | 2019 | 2020 | 2021 | 2022 | Thereafter | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||
Total debt | $ | 1,365,533 | $ | 123,848 | $ | 173,649 | $ | 326,649 | $ | 210,649 | $ | 530,738 | $ | — | |||||||||||||
Scheduled interest payment obligations (1) | 255,162 | 66,274 | 63,516 | 51,689 | 40,197 | 33,486 | — | ||||||||||||||||||||
Purchase obligations (2) | 143,902 | 131,860 | 2,244 | 1,863 | 1,592 | 1,591 | 4,752 | ||||||||||||||||||||
Operating lease obligations | 109,826 | 26,439 | 21,740 | 13,694 | 10,530 | 8,468 | 28,955 | ||||||||||||||||||||
Severance obligations (3) | 153,735 | 15,190 | 13,594 | 12,248 | 11,061 | 9,971 | 91,671 | ||||||||||||||||||||
Settlement payments (4) | 38,750 | 38,750 | — | — | — | — | — | ||||||||||||||||||||
Total contractual obligations | $ | 2,066,908 | $ | 402,361 | $ | 274,743 | $ | 406,143 | $ | 274,029 | $ | 584,254 | $ | 125,378 |
(1) | Scheduled interest payment obligations were calculated using stated coupon rates for fixed-rate debt and interest rates applicable at December 31, 2017, for variable-rate debt. |
(2) | Represents off-balance sheet purchase obligations for capital expenditures and long-term supply contracts outstanding at December 31, 2017. |
(3) | Represents estimated benefit payments for our Korean subsidiary severance plan. |
(4) | Represents settlement payments for patent license litigation. At December 31, 2017, the total obligation is $38.8 million of which $37.8 million is a current liability and $1.0 million will be imputed into interest over time. |
• | $43.4 million of foreign pension plan obligations, for which the timing and actual amount of impact on our future cash flow is uncertain. |
• | $29.0 million net liability associated with unrecognized tax benefits. Due to the uncertainty regarding the amount and the timing of any future cash outflows associated with our unrecognized tax benefits, we are unable to reasonably estimate the amount and period of ultimate settlement, if any, with the various taxing authorities. |
• | One-time transition tax: Further information is required to substantiate the underlying data supporting foreign earnings and profits, foreign tax credits, and amounts held in liquid and illiquid assets at various measurement |
• | Remeasurement of deferred tax assets and liabilities: Further analysis is required to calculate the impact on the related account balances including the impact of complex new provisions which include the Base Erosion Anti-abuse Tax and Global Intangible Low-Taxed Income (“GILTI”), designed to subject certain foreign earnings to U.S. tax. |
• | Valuation allowances: We have assessed whether valuation allowance analyses for deferred tax assets are affected by various aspects of the Tax Act (for example one-time transition tax, GILTI, new categories of foreign tax credits). Since we have recorded provisional amounts related to the provisions of the Tax Act, any corresponding determination of the need for a change in a valuation allowance is also provisional. |
• | significant under-performance relative to expected historical or projected future operating results; |
• | significant changes in the manner of our use of the asset; |
• | significant negative industry or economic trends and |
• | our market capitalization relative to net book value. |
Item 7A. | Quantitative and Qualitative Disclosures about Market Risk |
2018 | 2019 | 2020 | 2021 | 2022 | Total | Fair Value | |||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||
Fixed rate debt | $ | 17,393 | $ | 10,649 | $ | 130,649 | $ | 210,649 | $ | 530,738 | $ | 900,078 | $ | 919,405 | |||||||||||||
Average interest rate | 0.7 | % | 0.8 | % | 3.5 | % | 6.3 | % | 6.3 | % | 5.7 | % | |||||||||||||||
Variable rate debt | $ | 106,455 | $ | 163,000 | $ | 196,000 | $ | — | $ | — | $ | 465,455 | $ | 466,227 | |||||||||||||
Average interest rate | 2.9 | % | 3.8 | % | 3.6 | % | — | % | — | % | 3.5 | % | |||||||||||||||
Total debt maturities | $ | 123,848 | $ | 173,649 | $ | 326,649 | $ | 210,649 | $ | 530,738 | $ | 1,365,533 | $ | 1,385,632 |
Item 8. | Financial Statements and Supplementary Data |
Page | |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands, except per share data) | |||||||||||
Net sales | $ | 4,186,497 | $ | 3,893,635 | $ | 2,884,603 | |||||
Cost of sales | 3,429,224 | 3,198,158 | 2,405,338 | ||||||||
Gross profit | 757,273 | 695,477 | 479,265 | ||||||||
Selling, general and administrative | 297,455 | 284,331 | 232,409 | ||||||||
Research and development | 166,614 | 117,206 | 82,017 | ||||||||
Gain on sale of real estate | (108,109 | ) | — | — | |||||||
Total operating expenses | 355,960 | 401,537 | 314,426 | ||||||||
Operating income | 401,313 | 293,940 | 164,839 | ||||||||
Interest expense | 83,839 | 79,668 | 81,407 | ||||||||
Interest expense, related party | 1,715 | 4,969 | 4,969 | ||||||||
Other (income) expense, net | 11,889 | (5,854 | ) | 10,551 | |||||||
Total other expense, net | 97,443 | 78,783 | 96,927 | ||||||||
Income before taxes and equity in earnings of unconsolidated affiliate | 303,870 | 215,157 | 67,912 | ||||||||
Income tax expense | 38,982 | 47,853 | 28,035 | ||||||||
Income before equity in earnings of unconsolidated affiliate | 264,888 | 167,304 | 39,877 | ||||||||
Equity in earnings of J-Devices | — | — | 14,016 | ||||||||
Net income | 264,888 | 167,304 | 53,893 | ||||||||
Net income attributable to noncontrolling interests | (4,182 | ) | (3,114 | ) | (2,795 | ) | |||||
Net income attributable to Amkor | $ | 260,706 | $ | 164,190 | $ | 51,098 | |||||
Net income attributable to Amkor per common share: | |||||||||||
Basic | $ | 1.09 | $ | 0.69 | $ | 0.22 | |||||
Diluted | $ | 1.09 | $ | 0.69 | $ | 0.22 | |||||
Shares used in computing per common share amounts: | |||||||||||
Basic | 238,937 | 237,416 | 236,850 | ||||||||
Diluted | 239,651 | 238,034 | 237,170 |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Net income | $ | 264,888 | $ | 167,304 | $ | 53,893 | |||||
Other comprehensive income (loss), net of tax: | |||||||||||
Adjustments to unrealized components of defined benefit pension plans | 5,165 | 2,563 | 1,100 | ||||||||
Foreign currency translation | 11,092 | 5,783 | (146 | ) | |||||||
Equity interest in J-Devices' other comprehensive income (loss) | — | — | 29,433 | ||||||||
Total other comprehensive income (loss) | 16,257 | 8,346 | 30,387 | ||||||||
Comprehensive income | 281,145 | 175,650 | 84,280 | ||||||||
Comprehensive income attributable to noncontrolling interests | (4,182 | ) | (3,114 | ) | (2,795 | ) | |||||
Comprehensive income attributable to Amkor | $ | 276,963 | $ | 172,536 | $ | 81,485 |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands, except per share data) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 596,364 | $ | 549,518 | |||
Restricted cash | 2,000 | 2,000 | |||||
Accounts receivable, net of allowances of $6,946 and $9,902, respectively | 692,287 | 563,107 | |||||
Inventories | 326,492 | 267,990 | |||||
Other current assets | 33,727 | 27,081 | |||||
Total current assets | 1,650,870 | 1,409,696 | |||||
Property, plant and equipment, net | 2,695,065 | 2,564,648 | |||||
Goodwill | 25,036 | 24,122 | |||||
Restricted cash | 4,487 | 3,977 | |||||
Other assets | 146,051 | 89,643 | |||||
Total assets | $ | 4,521,509 | $ | 4,092,086 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Short-term borrowings and current portion of long-term debt | $ | 123,848 | $ | 35,192 | |||
Trade accounts payable | 569,085 | 487,430 | |||||
Capital expenditures payable | 294,258 | 144,370 | |||||
Accrued expenses | 374,598 | 338,669 | |||||
Total current liabilities | 1,361,789 | 1,005,661 | |||||
Long-term debt | 1,240,581 | 1,364,638 | |||||
Long-term debt, related party | — | 75,000 | |||||
Pension and severance obligations | 182,216 | 166,701 | |||||
Other non-current liabilities | 46,144 | 76,682 | |||||
Total liabilities | 2,830,730 | 2,688,682 | |||||
Commitments and contingencies (Note 17) | |||||||
Amkor stockholders’ equity: | |||||||
Preferred stock, $0.001 par value, 10,000 shares authorized, designated Series A, none issued | — | — | |||||
Common stock, $0.001 par value, 500,000 shares authorized, 285,129 and 284,479 shares issued, and 239,184 and 238,665 shares outstanding, respectively | 285 | 284 | |||||
Additional paid-in capital | 1,903,357 | 1,895,089 | |||||
Accumulated deficit | (42,851 | ) | (303,557 | ) | |||
Accumulated other comprehensive income (loss) | 22,519 | 6,262 | |||||
Treasury stock, at cost, 45,945 and 45,814 shares, respectively | (215,982 | ) | (214,490 | ) | |||
Total Amkor stockholders’ equity | 1,667,328 | 1,383,588 | |||||
Noncontrolling interests in subsidiaries | 23,451 | 19,816 | |||||
Total equity | 1,690,779 | 1,403,404 | |||||
Total liabilities and equity | $ | 4,521,509 | $ | 4,092,086 |
Additional Paid- In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Amkor Stockholders' Equity | Noncontrolling Interest in Subsidiaries | Total Equity | ||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | ||||||||||||||||||||||||||||||||||||
Shares | Par Value | Shares | Cost | ||||||||||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||||||||||||
Balance at December 31, 2014 | 282,231 | $ | 282 | $ | 1,878,810 | $ | (518,845 | ) | $ | (32,471 | ) | (45,604 | ) | $ | (213,028 | ) | $ | 1,114,748 | $ | 14,701 | $ | 1,129,449 | |||||||||||||||
Net income | — | — | — | 51,098 | — | — | — | 51,098 | 2,795 | 53,893 | |||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | 30,387 | — | — | 30,387 | — | 30,387 | |||||||||||||||||||||||||||
Treasury stock acquired through surrender of shares for tax withholding | — | — | — | — | — | (115 | ) | (730 | ) | (730 | ) | — | (730 | ) | |||||||||||||||||||||||
Issuance of stock through share-based compensation plans | 493 | 1 | 930 | — | — | — | — | 931 | — | 931 | |||||||||||||||||||||||||||
Share-based compensation | — | — | 3,852 | — | — | — | — | 3,852 | — | 3,852 | |||||||||||||||||||||||||||
Subsidiary dividends paid to noncontrolling interests | — | — | — | — | — | — | — | — | (246 | ) | (246 | ) | |||||||||||||||||||||||||
Balance at December 31, 2015 | 282,724 | $ | 283 | $ | 1,883,592 | $ | (467,747 | ) | $ | (2,084 | ) | (45,719 | ) | $ | (213,758 | ) | $ | 1,200,286 | $ | 17,250 | $ | 1,217,536 | |||||||||||||||
Net income | — | — | — | 164,190 | — | — | — | 164,190 | 3,114 | 167,304 | |||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | 8,346 | — | — | 8,346 | — | 8,346 | |||||||||||||||||||||||||||
Treasury stock acquired through surrender of shares for tax withholding | — | — | — | — | — | (95 | ) | (732 | ) | (732 | ) | — | (732 | ) | |||||||||||||||||||||||
Issuance of stock through share-based compensation plans | 1,755 | 1 | 8,246 | — | — | — | — | 8,247 | — | 8,247 | |||||||||||||||||||||||||||
Share-based compensation | — | — | 3,251 | — | — | — | — | 3,251 | — | 3,251 | |||||||||||||||||||||||||||
Subsidiary dividends paid to noncontrolling interests | — | — | — | — | — | — | — | — | (548 | ) | (548 | ) | |||||||||||||||||||||||||
Balance at December 31, 2016 | 284,479 | $ | 284 | $ | 1,895,089 | $ | (303,557 | ) | $ | 6,262 | (45,814 | ) | $ | (214,490 | ) | $ | 1,383,588 | $ | 19,816 | $ | 1,403,404 | ||||||||||||||||
Net income | — | — | — | 260,706 | — | — | — | 260,706 | 4,182 | 264,888 | |||||||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | 16,257 | — | — | 16,257 | — | 16,257 | |||||||||||||||||||||||||||
Treasury stock acquired through surrender of shares for tax withholding | — | — | — | — | — | (131 | ) | (1,492 | ) | (1,492 | ) | — | (1,492 | ) | |||||||||||||||||||||||
Issuance of stock through share-based compensation plans | 650 | 1 | 3,123 | — | — | — | — | 3,124 | — | 3,124 | |||||||||||||||||||||||||||
Share-based compensation | — | — | 5,145 | — | — | — | — | 5,145 | — | 5,145 | |||||||||||||||||||||||||||
Subsidiary dividends paid to noncontrolling interests | — | — | — | — | — | — | — | — | (547 | ) | (547 | ) | |||||||||||||||||||||||||
Balance at December 31, 2017 | 285,129 | $ | 285 | $ | 1,903,357 | $ | (42,851 | ) | $ | 22,519 | (45,945 | ) | $ | (215,982 | ) | $ | 1,667,328 | $ | 23,451 | $ | 1,690,779 |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | 264,888 | $ | 167,304 | $ | 53,893 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | 581,940 | 555,186 | 494,200 | ||||||||
Gain on sale of real estate | (108,109 | ) | — | — | |||||||
Amortization of deferred debt issuance costs and premiums | 1,235 | 1,403 | 1,665 | ||||||||
Deferred income taxes | (42,998 | ) | (1,746 | ) | (697 | ) | |||||
Equity in earnings of unconsolidated affiliate | — | — | (14,016 | ) | |||||||
Loss on debt retirement | 4,835 | — | 9,560 | ||||||||
Loss (gain) on disposal of fixed assets, net | (2,648 | ) | 1,390 | 1,190 | |||||||
Share-based compensation | 5,145 | 3,251 | 3,852 | ||||||||
Loss from acquisition of J-Devices | — | — | 13,501 | ||||||||
Proceeds from insurance recovery for property, plant and equipment | — | (15,166 | ) | — | |||||||
Other, net | (8,143 | ) | 2,858 | 4,014 | |||||||
Changes in assets and liabilities, net of acquisitions: | |||||||||||
Accounts receivable | (118,353 | ) | (29,126 | ) | 122,840 | ||||||
Inventories | (54,195 | ) | (28,397 | ) | 27,677 | ||||||
Other current assets | (2,473 | ) | 1,124 | (3,309 | ) | ||||||
Other assets | (458 | ) | 1,037 | 333 | |||||||
Trade accounts payable | 67,574 | 48,581 | (48,368 | ) | |||||||
Accrued expenses | 35,525 | 56,465 | (42,042 | ) | |||||||
Pension and severance obligations | 23,881 | 1,625 | (7,321 | ) | |||||||
Other non-current liabilities | (29,379 | ) | (36,387 | ) | (31,997 | ) | |||||
Net cash provided by operating activities | 618,267 | 729,402 | 584,975 | ||||||||
Cash flows from investing activities: | |||||||||||
Payments for property, plant and equipment | (550,943 | ) | (650,038 | ) | (537,975 | ) | |||||
Proceeds from sale of property, plant and equipment | 141,530 | 45,635 | 6,945 | ||||||||
Proceeds from insurance recovery for property, plant and equipment | — | 15,166 | — | ||||||||
Acquisition of business, net of cash acquired | (43,771 | ) | — | 22,577 | |||||||
Investment in J-Devices | — | — | (12,908 | ) | |||||||
Disposition of business to J-Devices, net of cash transferred | — | — | 8,355 | ||||||||
Other investing activities | (1,648 | ) | (190 | ) | (1,984 | ) | |||||
Net cash used in investing activities | (454,832 | ) | (589,427 | ) | (514,990 | ) | |||||
Cash flows from financing activities: | |||||||||||
Proceeds from revolving credit facilities | 75,000 | 125,000 | 290,000 | ||||||||
Payments of revolving credit facilities | — | (255,000 | ) | (150,000 | ) | ||||||
Proceeds from short-term debt | 77,781 | 49,131 | — | ||||||||
Payments of short-term debt | (70,236 | ) | (49,500 | ) | — | ||||||
Proceeds from issuance of long-term debt | 223,976 | 46,000 | 400,000 | ||||||||
Payments of long-term debt | (405,269 | ) | (32,078 | ) | (537,030 | ) | |||||
Payments of long-term debt, related party | (17,837 | ) | — | — | |||||||
Payments of capital lease obligations | (5,340 | ) | (2,543 | ) | — | ||||||
Payment of deferred consideration for purchase of facility | (3,890 | ) | — | — | |||||||
Proceeds from issuance of stock through share-based compensation plans | 3,124 | 8,247 | 931 | ||||||||
Other financing activities | (2,195 | ) | (1,436 | ) | (1,288 | ) | |||||
Net cash (used in) provided by financing activities | (124,886 | ) | (112,179 | ) | 2,613 | ||||||
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash | 8,807 | 351 | — | ||||||||
Net increase in cash, cash equivalents and restricted cash | 47,356 | 28,147 | 72,598 | ||||||||
Cash, cash equivalents and restricted cash, beginning of period | 555,495 | 527,348 | 454,750 | ||||||||
Cash, cash equivalents and restricted cash, end of period | $ | 602,851 | $ | 555,495 | $ | 527,348 | |||||
Supplemental disclosures of cash flow information: | |||||||||||
Cash paid during the period for: | |||||||||||
Interest | $ | 83,808 | $ | 86,777 | $ | 96,227 | |||||
Income taxes | 61,878 | 32,174 | 35,084 | ||||||||
Non-cash investing and financing activities: | |||||||||||
Property, plant and equipment included in capital expenditures payable | 294,912 | 146,080 | 242,980 | ||||||||
Equipment acquired through capital lease | 929 | 6,358 | — |
1. | Description of Business and Summary of Significant Accounting Policies |
• | Designing and developing innovative packaging and test technologies; |
• | Offering a broad portfolio of cost-effective solutions and services; |
• | Focusing on strategic end markets that offer solid growth potential; |
• | Cultivating long-standing relationships with our customers, which include many of the world’s leading semiconductor companies; |
• | Collaborating with customers, original equipment manufacturers ("OEMs") and equipment and material suppliers; |
• | Developing a competitive cost structure with disciplined capital investment; |
• | Building expertise in high-volume manufacturing processes and developing a reputation for high quality and solid execution and |
• | Providing a geographically diverse operating base, with research and development, engineering support and production capabilities at various facilities throughout China, Japan, Korea, Malaysia, the Philippines, Portugal and Taiwan. |
Land use rights | 50 to 90 years |
Buildings and improvements | 10 to 40 years |
Machinery and equipment | 2 to 7 years |
Software and computer equipment | 3 to 5 years |
Furniture, fixtures and other equipment | 4 to 10 years |
• | One-time transition tax: Further information is required to substantiate the underlying data supporting foreign earnings and profits, foreign tax credits, and amounts held in liquid and illiquid assets at various measurement dates. Changes to our provisional estimates and further analysis could impact our judgments, elections and assertions. |
• | Remeasurement of deferred tax assets and liabilities: Further analysis is required to calculate the impact on the related account balances including the impact of complex new provisions which include the Base Erosion Anti-abuse Tax and Global Intangible Low-Taxed Income (“GILTI”), designed to subject certain foreign earnings to U.S. tax. |
• | Valuation allowances: We have assessed whether valuation allowance analyses for deferred tax assets are affected by various aspects of the Tax Act (for example one-time transition tax, GILTI, new categories of foreign tax credits). |
2. | New Accounting Standards |
For the Year Ended December 31, 2017 | |||||||||||
As Reported | New Revenue Standard Adjustment (Estimate) | As Adjusted (Estimate) | |||||||||
(In thousands, except per share data) | |||||||||||
Income Statement: | |||||||||||
Net sales | $ | 4,186,497 | $ | 24,000 | $ | 4,210,497 | |||||
Cost of sales | 3,429,224 | 17,000 | 3,446,224 | ||||||||
Net income | 264,888 | 5,000 | 269,888 | ||||||||
Net income attributable to Amkor per common share: | |||||||||||
Basic | 1.09 | 0.02 | 1.11 | ||||||||
Diluted | 1.09 | 0.02 | 1.11 |
For the Year Ended December 31, 2016 | |||||||||||
As Previously Reported | New Revenue Standard Adjustment (Estimate) | As Adjusted (Estimate) | |||||||||
(In thousands, except per share data) | |||||||||||
Income Statement: | |||||||||||
Net sales | $ | 3,893,635 | $ | 36,000 | $ | 3,929,635 | |||||
Cost of sales | 3,198,158 | 21,000 | 3,219,158 | ||||||||
Net income | 167,304 | 11,000 | 178,304 | ||||||||
Net income attributable to Amkor per common share: | |||||||||||
Basic | 0.69 | 0.05 | 0.74 | ||||||||
Diluted | 0.69 | 0.04 | 0.73 |
December 31, 2017 | |||||||||||
As Reported | New Revenue Standard Adjustment (Estimate) | As Adjusted (Estimate) | |||||||||
(In thousands) | |||||||||||
Balance Sheet: | |||||||||||
Accounts receivable, net | $ | 692,287 | $ | 106,000 | $ | 798,287 | |||||
Inventories | 326,492 | (113,000 | ) | 213,492 | |||||||
Accrued expenses | 374,598 | (48,000 | ) | 326,598 | |||||||
Accumulated deficit | (42,851 | ) | 31,000 | (11,851 | ) |
3. | Acquisitions |
(In thousands) | |||
Fair value of consideration transferred: | |||
Cash | $ | 105,391 | |
Fair value of our previously held equity interest in J-Devices | 160,087 | ||
Total | $ | 265,478 | |
Recognized amounts of identifiable assets acquired and liabilities assumed: | |||
Cash | $ | 127,968 | |
Accounts receivable | 180,177 | ||
Inventory | 42,502 | ||
Other current assets | 2,363 | ||
Property, plant and equipment | 230,319 | ||
Other assets | 9,268 | ||
Short-term borrowings and current portion of long-term debt | (36,770 | ) | |
Other current liabilities | (251,405 | ) | |
Long-term debt | (18,885 | ) | |
Pension obligations | (22,250 | ) | |
Other non-current liabilities | (21,218 | ) | |
Total identifiable net assets | 242,069 | ||
Goodwill | 23,409 | ||
Total | $ | 265,478 |
For the Year Ended December 31 | |||||||
2015 | 2014 | ||||||
(unaudited) | (unaudited) | ||||||
(In thousands, except per share data) | |||||||
Net sales | $ | 3,696,495 | $ | 4,051,076 | |||
Net income | 88,190 | 153,049 | |||||
Net income attributable to Amkor | 85,394 | 149,548 | |||||
Basic earnings per share | 0.36 | 0.65 | |||||
Diluted earnings per share | 0.36 | 0.63 |
4. | Share-Based Compensation Plans |
Number of Shares (In thousands) | Weighted-Average Exercise Price per Share | Weighted-Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (In thousands) | ||||||||
Outstanding at December 31, 2016 | 2,443 | $ | 6.93 | ||||||||
Granted | 2,900 | 9.97 | |||||||||
Exercised | (469) | 6.66 | |||||||||
Forfeited or expired | (122) | 5.12 | |||||||||
Outstanding at December 31, 2017 | 4,752 | $ | 8.86 | 7.51 | $ | 6,403 | |||||
Fully vested at December 31, 2017 and expected to vest thereafter | 4,632 | $ | 8.83 | 7.46 | $ | 6,369 | |||||
Exercisable at December 31, 2017 | 1,733 | $ | 7.17 | 4.75 | $ | 5,455 |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Expected life (in years) | 5.7 | 6.5 | 5.8 | ||||||||
Risk-free interest rate | 1.9 | % | 1.5 | % | 1.8 | % | |||||
Volatility | 43 | % | 48 | % | 45 | % | |||||
Dividend yield | — | — | — | ||||||||
Weighted-average grant date fair value per option granted | $ | 4.24 | $ | 2.89 | $ | 3.14 |
Number of Shares (In thousands) | Weighted- average Grant Date Fair Value (Per Share) | |||||
Nonvested at December 31, 2016 | 145 | $ | 5.02 | |||
Awards granted | 224 | 10.06 | ||||
Awards vested | (181 | ) | 5.93 | |||
Awards forfeited | — | — | ||||
Nonvested at December 31, 2017 | 188 | 10.15 |
5. | Other Income and Expense |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Interest income | $ | (3,215 | ) | $ | (1,326 | ) | $ | (2,539 | ) | ||
Foreign currency (gain) loss, net | 11,823 | (3,592 | ) | (7,849 | ) | ||||||
Loss on debt retirement | 4,835 | — | 9,560 | ||||||||
Loss from acquisition of J-Devices (Note 3) | — | — | 13,501 | ||||||||
Other (income) expense, net | (1,554 | ) | (936 | ) | (2,122 | ) | |||||
Total other (income) expense, net | $ | 11,889 | $ | (5,854 | ) | $ | 10,551 |
6. | Income Taxes |
(In thousands) | |||
One-time transition tax before credits | $ | 162,750 | |
Tax credits | (128,395 | ) | |
Remeasure deferred tax assets | 36,794 | ||
Release valuation allowance | (112,703 | ) | |
Net impact of the Tax Act | $ | (41,554 | ) |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
United States | $ | 14,935 | $ | (12,385 | ) | $ | (39,684 | ) | |||
Foreign | 288,935 | 227,542 | 107,596 | ||||||||
Income before taxes and equity in earnings of unconsolidated affiliate | $ | 303,870 | $ | 215,157 | $ | 67,912 |
For the Year Ended December 31 | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Current: | |||||||||||
Federal | $ | — | $ | — | $ | — | |||||
State | 11 | 22 | 11 | ||||||||
Foreign | 81,969 | 49,577 | 28,721 | ||||||||
81,980 | 49,599 | 28,732 | |||||||||
Deferred: | |||||||||||
Federal | (36,943 | ) | — | — | |||||||
State | (4,611 | ) | — | — | |||||||
Foreign | (1,444 | ) | (1,746 | ) | (697 | ) | |||||
(42,998 | ) | (1,746 | ) | (697 | ) | ||||||
Income tax expense | $ | 38,982 | $ | 47,853 | $ | 28,035 |
For the Year Ended December 31 | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
U.S. federal tax at 35% | $ | 106,354 | $ | 75,305 | $ | 23,769 | |||||
State taxes, net of federal benefit | 2,193 | 836 | 2,622 | ||||||||
Foreign income taxed at different rates | (51,412 | ) | (17,907 | ) | (11,756 | ) | |||||
Foreign exchange (loss) gain | 29,756 | (1,127 | ) | (5,680 | ) | ||||||
Change in valuation allowance | (4,703 | ) | (7,362 | ) | 18,259 | ||||||
Adjustments related to prior years | 3,329 | (2,648 | ) | (912 | ) | ||||||
U.S. tax reform (the Tax Act) | (41,554 | ) | — | — | |||||||
Income tax credits generated | (7,296 | ) | (40,301 | ) | (1,919 | ) | |||||
Repatriation of foreign earnings and profits | 719 | 25,604 | 91 | ||||||||
Expiration of net operating losses and credits | 166 | 15,092 | 74 | ||||||||
Non-deductible loss on acquisition of J-Devices (Note 3) | — | — | 4,725 | ||||||||
Other | 1,430 | 361 | (1,238 | ) | |||||||
Income tax expense | $ | 38,982 | $ | 47,853 | $ | 28,035 |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Deferred tax assets: | |||||||
Net operating loss carryforwards | $ | 53,130 | $ | 111,899 | |||
Income tax credits | 23,998 | 41,900 | |||||
Property, plant and equipment | 35,479 | 21,860 | |||||
Accrued liabilities | 68,091 | 68,563 | |||||
Receivable | 32,719 | — | |||||
Unrealized foreign exchange loss | 1,924 | 531 | |||||
Other | 12,682 | 14,583 | |||||
Total deferred tax assets | 228,023 | 259,336 | |||||
Valuation allowance | (83,338 | ) | (165,367 | ) | |||
Total deferred tax assets net of valuation allowance | 144,685 | 93,969 | |||||
Deferred tax liabilities: | |||||||
Property, plant and equipment | 15,754 | 20,407 | |||||
Deferred gain | 939 | 2,655 | |||||
Unrealized foreign exchange gain | 8,383 | 990 | |||||
Other | 4,566 | 4,836 | |||||
Total deferred tax liabilities | 29,642 | 28,888 | |||||
Net deferred tax assets | $ | 115,043 | $ | 65,081 | |||
Recognized as: | |||||||
Other assets | 117,608 | 66,831 | |||||
Other non-current liabilities | (2,565 | ) | (1,750 | ) | |||
Total | $ | 115,043 | $ | 65,081 |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Valuation allowance: | |||||||
U.S. | $ | 43,719 | $ | 164,479 | |||
Portugal | 39,009 | — | |||||
Other | 610 | 888 | |||||
Total valuation allowance | $ | 83,338 | $ | 165,367 |
December 31, | |||||||||
2017 | 2016 | Expiration | |||||||
(In thousands) | |||||||||
U.S. Federal NOL’s | $ | 220,445 | $ | 292,715 | 2021-2037 | ||||
U.S. State NOL’s | 121,095 | 138,218 | 2018-2036 | ||||||
Foreign NOL’s | 2,967 | 3,378 | 2018-2025 |
For the Year Ended December 31 | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Balance at January 1 | $ | 23,149 | $ | 23,332 | $ | 12,670 | |||||
Additions based on tax positions related to the current year | 1,419 | 1,822 | 12,727 | ||||||||
Additions for tax positions of prior years | 2,661 | 689 | 3,341 | ||||||||
Reductions for tax positions of prior years | (1 | ) | (2,589 | ) | (4,815 | ) | |||||
Reductions from lapse of statutes of limitations | (17 | ) | (105 | ) | (591 | ) | |||||
Balance at December 31 | $ | 27,211 | $ | 23,149 | $ | 23,332 |
7. | Earnings Per Share |
For the Year Ended December 31 | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands, except per share data) | |||||||||||
Net income attributable to Amkor | $ | 260,706 | $ | 164,190 | $ | 51,098 | |||||
Income allocated to participating securities | — | — | (59 | ) | |||||||
Net income available to Amkor common stockholders | $ | 260,706 | $ | 164,190 | $ | 51,039 | |||||
Weighted-average shares outstanding — basic | 238,937 | 237,416 | 236,850 | ||||||||
Effect of dilutive securities: | |||||||||||
Stock options and restricted share awards | 714 | 618 | 320 | ||||||||
Weighted-average shares outstanding — diluted | 239,651 | 238,034 | 237,170 | ||||||||
Net income attributable to Amkor per common share: | |||||||||||
Basic | $ | 1.09 | $ | 0.69 | $ | 0.22 | |||||
Diluted | 1.09 | 0.69 | 0.22 |
For the Year Ended December 31 | ||||||||
2017 | 2016 | 2015 | ||||||
(In thousands) | ||||||||
Stock options and restricted share awards | 3,445 | 1,135 | 1,858 |
8. | Factoring of Accounts Receivable |
9. | Inventories |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Raw materials and purchased components | $ | 213,649 | $ | 173,035 | |||
Work-in-process | 112,843 | 94,955 | |||||
Total inventories | $ | 326,492 | $ | 267,990 |
10. | Property, Plant and Equipment |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Land | $ | 224,894 | $ | 240,719 | |||
Land use rights | 26,845 | 26,845 | |||||
Buildings and improvements | 1,384,846 | 1,362,007 | |||||
Machinery and equipment | 4,938,291 | 4,483,523 | |||||
Software and computer equipment | 200,500 | 205,969 | |||||
Furniture, fixtures and other equipment | 15,722 | 21,313 | |||||
Construction in progress | 104,910 | 87,037 | |||||
Total property, plant and equipment | 6,896,008 | 6,427,413 | |||||
Less accumulated depreciation and amortization | (4,200,943 | ) | (3,862,765 | ) | |||
Total property, plant and equipment, net | $ | 2,695,065 | $ | 2,564,648 |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Depreciation expense | $ | 580,172 | $ | 552,989 | $ | 492,458 |
11. | Goodwill |
Goodwill | |||
(In thousands) | |||
Balance at December 31, 2015 | $ | 23,409 | |
Translation adjustment | 713 | ||
Balance at December 31, 2016 | $ | 24,122 | |
Translation adjustment | 914 | ||
Balance at December 31, 2017 | $ | 25,036 |
12. | Accrued Expenses |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Payroll and benefits | $ | 134,785 | $ | 117,636 | |||
Deferred revenue and customer advances | 63,196 | 65,653 | |||||
Income taxes payable | 56,664 | 37,961 | |||||
Accrued settlement costs | 37,783 | 35,304 | |||||
Accrued severance plan obligations (Note 14) | 15,190 | 14,053 | |||||
Accrued interest | 11,873 | 13,046 | |||||
Other accrued expenses | 55,107 | 55,016 | |||||
Total accrued expenses | $ | 374,598 | $ | 338,669 |
13. | Debt |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Debt of Amkor Technology, Inc.: | |||||||
Senior secured credit facilities: | |||||||
$200 million revolving credit facility, LIBOR plus 1.25%-1.75%, due December 2019 (1) | $ | — | $ | — | |||
Senior notes: | |||||||
6.625% Senior notes, due June 2021 (2) | 200,000 | 400,000 | |||||
6.375% Senior notes, due October 2022 | 524,971 | 524,971 | |||||
Debt of subsidiaries: | |||||||
Amkor Technology Korea, Inc.: | |||||||
$75 million revolving credit facility, foreign currency funding-linked base rate plus 1.60%, due June 2018 (3) | 75,000 | — | |||||
Term loan, LIBOR plus 2.70%, due December 2019 | 55,000 | 55,000 | |||||
Term loan, foreign currency funding-linked base rate plus 1.32%, due May 2020 | 150,000 | 150,000 | |||||
Term loan, fixed rate at 3.70%, due May 2020 (4) | 120,000 | — | |||||
Term loan, fund floating rate plus 1.60%, due June 2020 (5) | 86,000 | 86,000 | |||||
Term loan, LIBOR plus 2.60%, due May 2018 (4) | — | 120,000 | |||||
Term loan, foreign currency funding-linked base rate plus 1.33%, due May 2020 (3) | — | 80,000 | |||||
J-Devices Corporation: | |||||||
Short-term term loans, variable rates (6) | 30,455 | 22,230 | |||||
Term loans, fixed rate at 0.53%, due April 2018 | 6,744 | 19,460 | |||||
Term loan, fixed rate at 0.86%, due June 2022 (7) | 39,933 | — | |||||
Term loan, fixed rate at 0.60%, due July 2022 (8) | 8,430 | — | |||||
Other: | |||||||
Revolving credit facility, TAIFX plus a bank-determined spread, due November 2020 (Taiwan) (9) | 20,000 | 20,000 | |||||
Term loan, LIBOR plus 1.80%, due December 2019 (China) (10) | 49,000 | — | |||||
1,365,533 | 1,477,661 | ||||||
Less: Unamortized premium and deferred debt costs, net | (1,104 | ) | (2,831 | ) | |||
Less: Short-term borrowings and current portion of long-term debt | (123,848 | ) | (35,192 | ) | |||
Long-term debt (including related party) | $ | 1,240,581 | $ | 1,439,638 |
(1) | Our $200.0 million senior secured revolving credit facility has a letter of credit sub-limit facility of $25.0 million. Principal is payable at maturity. The availability for the revolving credit facility is based on the amount of our eligible accounts receivable. As of December 31, 2017, we had availability of $199.4 million under this facility, after reduction of $0.6 million of outstanding standby letters of credit. |
(2) | In July 2017, we redeemed $200.0 million aggregate principal amount of the outstanding $400.0 million of our 6.625% Senior Notes due 2021 ("Notes"), which included $17.5 million held by a related party. In accordance with the terms of the indenture governing the Notes, the redemption price was 101.656% of the principal amount |
(3) | In April 2017, we decreased the revolving credit facility from $100.0 million to $75.0 million. Principal is payable at maturity, which was extended in June 2017 for one year to June 2018. In April 2017, we borrowed $75.0 million on this facility and repaid the outstanding balance of $80.0 million on our term loan due May 2020. |
(4) | In May 2017, we entered into a $120.0 million term loan agreement to repay the $120.0 million term loan due in 2018. The new term loan agreement extended the maturity date to 2020 and changed the interest rate to a fixed rate. Principal is payable at maturity. |
(5) | In May 2015, we entered into a term loan agreement pursuant to which we may borrow up to $150.0 million for capital expenditures. Principal is payable at maturity. As of December 31, 2017, $64.0 million was available to be borrowed. |
(6) | We entered into various short-term loans which mature semiannually. Principle is payable in monthly installments. As of December 31, 2017, $6.2 million was available to be drawn. |
(7) | In June 2017, we entered into a ¥5.0 billion term loan agreement for capital expenditures. Principal is payable in quarterly installments of ¥250.0 million. In June 2017, we borrowed ¥5.0 billion. |
(8) | In July 2017, we entered into a ¥1.0 billion term loan agreement for capital expenditures. Principal is payable in quarterly installments of ¥50.0 million. In July 2017, we borrowed ¥1.0 billion. |
(9) | In November 2015, we entered into a $39.0 million revolving credit facility. Principal is payable at maturity. As of December 31, 2017, $19.0 million was available to be drawn. |
(10) | In December 2016, we entered into a $50.0 million term loan agreement. Principal is payable in semiannual installments of $0.5 million, with the remaining balance due at maturity. In January 2017, we borrowed $50.0 million. |
December 31, | |||||
2017 | 2016 | ||||
Amkor Technology, Inc.: | |||||
$200 million revolving credit facility, LIBOR plus 1.25%-1.75%, due December 2019 | — | % | — | % | |
Amkor Technology Korea, Inc.: | |||||
$75 million revolving credit facility, foreign currency funding-linked base rate plus 1.60%, due June 2018 | 4.01 | % | — | % | |
Term loan, LIBOR plus 2.60%, due May 2018 | — | % | 3.49 | % | |
Term loan, LIBOR plus 2.70%, due December 2019 | 4.02 | % | 3.54 | % | |
Term loan, foreign currency funding-linked base rate plus 1.32%, due May 2020 | 4.06 | % | 3.58 | % | |
Term loan, foreign currency funding-linked base rate plus 1.33%, due May 2020 | — | % | 3.59 | % | |
Term Loan, fund floating rate plus 1.60%, due June 2020 | 3.29 | % | 2.79 | % | |
J-Devices Corporation: | |||||
Short-term credit facilities, variable rates | 0.22 | % | 0.32 | % | |
Amkor Technology Taiwan Ltd.: | |||||
Revolving credit facility, TAIFX plus a bank-determined spread, due November 2020 | 3.18 | % | 2.78 | % | |
Amkor Assembly & Test (Shanghai) Co., Ltd.: | |||||
Term loan, LIBOR plus 1.80%, due December 2019 | 3.16 | % | — | % |
Total Debt | |||
(In thousands) | |||
Payments due for the year ending December 31, | |||
2018 | $ | 123,848 | |
2019 | 173,649 | ||
2020 | 326,649 | ||
2021 | 210,649 | ||
2022 | 530,738 | ||
Total debt | $ | 1,365,533 |
For the Year Ended December 31 | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Balance at January 1 | $ | 136,396 | $ | 143,151 | $ | 146,880 | |||||
Provision of severance benefits | 11,714 | 6,746 | 21,088 | ||||||||
Severance payments | (11,787 | ) | (9,429 | ) | (15,021 | ) | |||||
Foreign currency (gain) loss | 17,597 | (4,072 | ) | (9,796 | ) | ||||||
Balance at December 31 | 153,920 | 136,396 | 143,151 | ||||||||
Payments remaining with the National Pension Fund | (185 | ) | (182 | ) | (192 | ) | |||||
Total accrued severance plan obligations at December 31 | 153,735 | 136,214 | 142,959 | ||||||||
Less current portion of accrued severance plan obligations (Note 12) | 15,190 | 14,053 | 14,306 | ||||||||
Non-current portion of accrued severance plan obligations | $ | 138,545 | $ | 122,161 | $ | 128,653 |
For the Year Ended December 31 | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Change in projected benefit obligation: | |||||||
Projected benefit obligation at January 1 | $ | 131,416 | $ | 109,695 | |||
Service cost | 33,823 | 33,854 | |||||
Interest cost | 4,067 | 3,641 | |||||
Benefits paid | (15,183 | ) | (8,499 | ) | |||
Actuarial (gain) loss | (1,387 | ) | (2,801 | ) | |||
Effects of curtailment | 573 | — | |||||
Settlement | (2,496 | ) | (1,165 | ) | |||
Foreign exchange (gain) loss | 7,653 | (3,309 | ) | ||||
Projected benefit obligation at December 31 | 158,466 | 131,416 | |||||
Change in plan assets: | |||||||
Fair value of plan assets at January 1 | 91,471 | 76,042 | |||||
Actual gain (loss) on plan assets | 8,559 | 2,876 | |||||
Employer contributions | 28,073 | 25,114 | |||||
Settlement | (2,496 | ) | (1,165 | ) | |||
Benefits paid | (15,183 | ) | (8,499 | ) | |||
Foreign exchange gain (loss) | 5,301 | (2,897 | ) | ||||
Fair value of plan assets at December 31 | 115,725 | 91,471 | |||||
Funded status of the Plans at December 31 | $ | (42,741 | ) | $ | (39,945 | ) |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Amounts recognized in the Consolidated Balance Sheets consist of: | |||||||
Prepaid benefit cost (included in non-current assets) | $ | 656 | $ | — | |||
Accrued benefit liability (included in pension and severance obligations) | (43,397 | ) | (39,945 | ) | |||
Net amount recognized at year end | $ | (42,741 | ) | $ | (39,945 | ) |
Prior Service Cost | Actuarial Net Gain (Loss) | Total | |||||||||
(In thousands) | |||||||||||
Balance at December 31, 2015 | $ | 560 | $ | (1,985 | ) | $ | (1,425 | ) | |||
Amortization included in net periodic pension cost | 22 | 73 | 95 | ||||||||
Net gain (loss) arising during period | — | 2,468 | 2,468 | ||||||||
Adjustments to unrealized components of defined benefit pension plan included in other comprehensive income (loss) | 22 | 2,541 | 2,563 | ||||||||
Balance at December 31, 2016 | 582 | 556 | 1,138 | ||||||||
Amortization included in net periodic pension cost | 21 | 69 | 90 | ||||||||
Net gain (loss) arising during period | — | 5,075 | 5,075 | ||||||||
Adjustments to unrealized components of defined benefit pension plan included in other comprehensive income (loss) | 21 | 5,144 | 5,165 | ||||||||
Balance at December 31, 2017 | $ | 603 | $ | 5,700 | $ | 6,303 | |||||
Estimated amortization of cost to be included in 2018 net periodic pension cost | $ | 1 | $ | (147 | ) | $ | (146 | ) |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Plans with underfunded or non-funded projected benefit obligation: | |||||||
Aggregate projected benefit obligation | $ | 119,708 | $ | 131,416 | |||
Aggregate fair value of plan assets | 76,313 | 91,471 | |||||
Plans with underfunded or non-funded accumulated benefit obligation: | |||||||
Aggregate accumulated benefit obligation | 53,720 | 49,285 | |||||
Aggregate fair value of plan assets | 18,970 | 16,811 |
For the Year Ended December 31 | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Components of net periodic pension cost and total pension expense: | |||||||||||
Service cost | $ | 33,823 | $ | 33,854 | $ | 12,481 | |||||
Interest cost | 4,067 | 3,641 | 2,954 | ||||||||
Expected return on plan assets | (4,537 | ) | (3,788 | ) | (3,330 | ) | |||||
Amortization of prior service cost | 30 | 35 | 34 | ||||||||
Recognized actuarial (gain) loss | 84 | 94 | 91 | ||||||||
Net periodic pension cost | 33,467 | 33,836 | 12,230 | ||||||||
Curtailment loss | 574 | — | — | ||||||||
Settlement (gain) loss | 383 | 128 | 27 | ||||||||
Total pension expense | $ | 34,424 | $ | 33,964 | $ | 12,257 |
For the Year Ended December 31 | ||||||||
2017 | 2016 | 2015 | ||||||
Discount rate for determining net periodic pension cost | 3.1 | % | 3.3 | % | 4.2 | % | ||
Discount rate for determining benefit obligations at December 31 | 3.2 | % | 3.1 | % | 3.3 | % | ||
Rate of compensation increase for determining net periodic pension cost | 3.8 | % | 3.9 | % | 4.7 | % | ||
Rate of compensation increase for determining benefit obligations at December 31 | 3.8 | % | 3.8 | % | 3.9 | % | ||
Expected rate of return on plan assets for determining net periodic pension cost | 4.9 | % | 5.0 | % | 6.2 | % |
Allocation | ||||||||
Debt | Equity | Other | ||||||
Japan defined benefit plan | 60 | % | 37 | % | 3 | % | ||
Korea defined benefit plan | 40 | % | 50 | % | 10 | % | ||
Philippine defined benefit plan | 40 | % | 56 | % | 4 | % |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Cash and cash equivalents (Level 1) | $ | 1,098 | $ | 10,419 | |||
Equity securities | |||||||
U.S. securities (Level 1) | 16,854 | 12,602 | |||||
Foreign securities (Level 1) | 16,826 | 8,825 | |||||
Foreign mutual funds (Level 1) | 22,193 | 12,718 | |||||
55,873 | 34,145 | ||||||
Debt securities | |||||||
U.S. government bonds (Level 1) | 2,188 | 2,859 | |||||
U.S. government bonds (Level 2) | 830 | — | |||||
U.S. corporate bonds (Level 1) | 2,144 | 1,980 | |||||
U.S. corporate bonds (Level 2) | 5 | — | |||||
Foreign government bonds (Level 1) | 5,211 | 11,001 | |||||
Foreign government bonds (Level 2) | 6,270 | 7,727 | |||||
Foreign corporate bonds (Level 1) | 520 | — | |||||
Foreign corporate bonds (Level 2) | 3,058 | 1,693 | |||||
Foreign treasury notes (Level 1) | 4,686 | — | |||||
Foreign mutual funds (Level 1) | 8,787 | 10,044 | |||||
33,699 | 35,304 | ||||||
Foreign guaranteed investment contracts (Level 2) | 14,138 | 2,445 | |||||
Taiwan retirement fund (Level 1) | 10,094 | 8,972 | |||||
Other (Level 1) | 584 | — | |||||
Other (Level 2) | 239 | 186 | |||||
Total fair value of pension plan assets | $ | 115,725 | $ | 91,471 |
Payments | |||
(In thousands) | |||
2018 | $ | 6,288 | |
2019 | 7,516 | ||
2020 | 9,538 | ||
2021 | 11,602 | ||
2022 | 14,143 | ||
2023 to 2027 | 107,557 |
15. | Accumulated Other Comprehensive Income (Loss) |
Defined Benefit Pension | Foreign Currency Translation | Total | |||||||||
(In thousands) | |||||||||||
Balance at December 31, 2015 | $ | (1,425 | ) | $ | (659 | ) | $ | (2,084 | ) | ||
Other comprehensive income (loss) before reclassifications | 2,468 | 5,783 | 8,251 | ||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 95 | — | 95 | ||||||||
Other comprehensive income (loss) | 2,563 | 5,783 | 8,346 | ||||||||
Balance at December 31, 2016 | $ | 1,138 | $ | 5,124 | $ | 6,262 | |||||
Other comprehensive income (loss) before reclassifications | 5,075 | 11,092 | 16,167 | ||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 90 | — | 90 | ||||||||
Other comprehensive income (loss) | 5,165 | 11,092 | 16,257 | ||||||||
Balance at December 31, 2017 | $ | 6,303 | $ | 16,216 | $ | 22,519 |
16. | Fair Value Measurements |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
Cash equivalent money market funds (Level 1) | $ | 121,627 | $ | 39,548 | |||
Restricted cash money market funds (Level 1) | 2,000 | 2,000 |
December 31, 2017 | December 31, 2016 | ||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||
(In thousands) | |||||||||||||||
Senior notes (Level 1) | $ | 745,943 | $ | 723,867 | $ | 954,765 | $ | 922,140 | |||||||
Revolving credit facilities and term loans (Level 2) | 639,689 | 640,562 | 551,793 | 552,690 | |||||||||||
Total financial instruments | $ | 1,385,632 | $ | 1,364,429 | $ | 1,506,558 | $ | 1,474,830 |
17. | Commitments and Contingencies |
For the Year Ended December 31 | |||
(In thousands) | |||
2018 | $ | 26,439 | |
2019 | 21,740 | ||
2020 | 13,694 | ||
2021 | 10,530 | ||
2022 | 8,468 | ||
Thereafter | 28,955 | ||
Total future minimum lease payments | $ | 109,826 |
18. | Business Segments, Customer Concentrations and Geographic Information |
• | We are managed under a functionally-based organizational structure with the head of each function reporting directly to the CODM; |
• | We assess performance, including incentive compensation, based on consolidated operating performance and financial results; |
• | Our CODM allocates resources and makes other operating decisions based on specific customer business opportunities and |
• | We have an integrated process for the design, development and manufacturing services we provide to all of our customers. We also have centralized sales and administrative functions. |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Advanced Products | $ | 1,950,340 | $ | 1,679,529 | $ | 1,432,493 | |||||
Mainstream Products | 2,236,157 | 2,214,106 | 1,452,110 | ||||||||
Total net sales | $ | 4,186,497 | $ | 3,893,635 | $ | 2,884,603 |
For the Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(In thousands) | |||||||||||
Japan | $ | 1,208,822 | $ | 1,158,318 | $ | 372,810 | |||||
Asia Pacific (excluding Japan) | 827,061 | 627,177 | 609,409 | ||||||||
Europe, Middle East and Africa | 536,552 | 487,584 | 489,842 | ||||||||
Total foreign countries | 2,572,435 | 2,273,079 | 1,472,061 | ||||||||
United States | 1,614,062 | 1,620,556 | 1,412,542 | ||||||||
Total net sales | $ | 4,186,497 | $ | 3,893,635 | $ | 2,884,603 |
December 31, | |||||||
2017 | 2016 | ||||||
(In thousands) | |||||||
China | $ | 528,739 | $ | 500,319 | |||
Japan | 246,223 | 245,233 | |||||
Korea | 1,131,271 | 1,130,147 | |||||
Malaysia | 47,922 | 36,248 | |||||
Philippines | 309,425 | 313,885 | |||||
Portugal | 64,578 | — | |||||
Taiwan | 356,174 | 326,614 | |||||
Other foreign countries | 216 | 243 | |||||
Total foreign countries | 2,684,548 | 2,552,689 | |||||
United States | 10,517 | 11,959 | |||||
Total property, plant and equipment, net | $ | 2,695,065 | $ | 2,564,648 |
For the Quarter Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2017 (c) | Sept. 30, 2017 | June 30, 2017 (a) | Mar. 31, 2017 | Dec. 31, 2016 | Sept. 30, 2016 | June 30, 2016 | Mar. 31, 2016 | ||||||||||||||||||||||||
(In thousands, except per share data) | |||||||||||||||||||||||||||||||
Net sales | $ | 1,148,423 | $ | 1,135,027 | $ | 989,447 | $ | 913,600 | $ | 1,021,613 | $ | 1,086,014 | $ | 917,326 | $ | 868,682 | |||||||||||||||
Gross profit | 225,494 | 216,638 | 172,235 | 142,906 | 227,187 | 213,800 | 131,606 | 122,884 | |||||||||||||||||||||||
Operating income (b) | 110,128 | 98,237 | 168,293 | 24,655 | 126,689 | 114,615 | 30,542 | 22,094 | |||||||||||||||||||||||
Income tax (benefit) expense | (12,782 | ) | 18,752 | 32,573 | 439 | 18,534 | 24,086 | 3,360 | 1,873 | ||||||||||||||||||||||
Net income (loss) | 101,943 | 55,630 | 116,459 | (9,144 | ) | 101,202 | 61,141 | 5,366 | (405 | ) | |||||||||||||||||||||
Net income (loss) attributable to Amkor | 100,770 | 54,435 | 115,507 | (10,006 | ) | 100,263 | 60,089 | 4,713 | (875 | ) | |||||||||||||||||||||
Net income (loss) attributable to Amkor per common share: | |||||||||||||||||||||||||||||||
Basic | $ | 0.42 | $ | 0.23 | $ | 0.48 | $ | (0.04 | ) | $ | 0.42 | $ | 0.25 | $ | 0.02 | $ | — | ||||||||||||||
Diluted | $ | 0.42 | $ | 0.23 | $ | 0.48 | $ | (0.04 | ) | $ | 0.42 | $ | 0.25 | $ | 0.02 | $ | — |
(a) | In May 2017, we completed the purchase of Nanium. Nanium's financial results have been included in our Consolidated Financial Statements from the date of acquisition. |
(b) | In May 2017, we sold the land and buildings comprising our K1 factory for $142.4 million which resulted in a pre-tax gain of $108.1 million. |
(c) | In the fourth quarter of 2017, net income includes an estimated net tax benefit of $41.6 million primarily due to the reversal of a valuation allowance on certain U.S. deferred tax assets as a result of the enactment of the Tax Act. |
Balance at Beginning of Period | Additions (Credited) Charged to Expense | Write-offs | (a) Other | Balance at End of Period | ||||||||||||
(In thousands) | ||||||||||||||||
Deferred tax asset valuation allowance: | ||||||||||||||||
Year ended December 31, 2015 | $ | 149,847 | 18,507 | (248 | ) | (1 | ) | $ | 168,105 | |||||||
Year ended December 31, 2016 | $ | 168,105 | 7,729 | (15,091 | ) | 4,624 | $ | 165,367 | ||||||||
Year ended December 31, 2017 | $ | 165,367 | (116,917 | ) | (489 | ) | 35,377 | $ | 83,338 |
(a) | Column represents adjustments to the deferred tax asset valuation allowance established as part of the purchase accounting related to Amkor's acquisition of Nanium in 2017 and adjustments directly through stockholders’ equity for changes in accumulated other comprehensive income (loss) related to our foreign defined benefit pension plans and the adoption of ASU 2016-09 on July 1, 2016. |
Item 9. | Changes In and Disagreements with Accountants on Accounting and Financial Disclosure |
Item 9A. | Controls and Procedures |
Item 9B. | Other Information |
Item 10. | Directors, Executive Officers and Corporate Governance |
Item 11. | Executive Compensation |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
(a) Number of Securities to be Issued Upon Exercise of Outstanding Options (In thousands) | (b) Weighted Average Exercise Price of Outstanding Options | (c) Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column(a) (In thousands) | |||||||
Equity compensation plan approved by stockholders (1) | 4,752 | $ | 8.86 | 8,024 | |||||
Equity compensation plans not approved by stockholders | — | — | — | ||||||
Total equity compensation plans | 4,752 | 8,024 |
(1) | As of December 31, 2017, a total of 8.0 million shares were reserved for issuance under the 2007 Plan. Shares available for issuance under our 2007 Plan can be granted pursuant to stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares. |
Item 13. | Certain Relationships and Related Transactions, and Director Independence |
Item 14. | Principal Accountant Fees and Services |
Item 15. | Exhibits and Financial Statement Schedules |
Item 16. | Form 10-K Summary |
By: | /s/ Stephen D. Kelley | |
Stephen D. Kelley President and Chief Executive Officer | ||
Date: | February 23, 2018 |
Name | Title | Date | ||
/s/ Stephen D. Kelley | President and Chief Executive Officer | February 23, 2018 | ||
Stephen D. Kelley | ||||
/s/ Megan Faust | Corporate Vice President and Chief Financial Officer | February 23, 2018 | ||
Megan Faust | ||||
/s/ James J. Kim | Executive Chairman | February 23, 2018 | ||
James J. Kim | ||||
/s/ John T. Kim | Executive Vice Chairman | February 23, 2018 | ||
John T. Kim | ||||
/s/ Susan Y. Kim | Director | February 23, 2018 | ||
Susan Y. Kim | ||||
/s/ Douglas Alexander | Director | February 23, 2018 | ||
Douglas Alexander | ||||
/s/ Roger A. Carolin | Director | February 23, 2018 | ||
Roger A. Carolin |
Name | Title | Date | ||
/s/ Winston J. Churchill | Director | February 23, 2018 | ||
Winston J. Churchill | ||||
/s/ MaryFrances McCourt | Director | February 23, 2018 | ||
MaryFrances McCourt | ||||
/s/ Robert R. Morse | Director | February 23, 2018 | ||
Robert R. Morse | ||||
/s/ John F. Osborne | Director | February 23, 2018 | ||
John F. Osborne | ||||
/s/ David N. Watson | Director | February 23, 2018 | ||
David N. Watson | ||||
/s/ James W. Zug | Director | February 23, 2018 | ||
James W. Zug |
Incorporated by Reference | Filed Herewith | ||||||||||||
Exhibit Number | Exhibit Description | Form | Period Ending | Exhibit | Filing Date | ||||||||
2.1 | 10-Q | 6/30/04 | 2.3 | 8/6/04 | |||||||||
3.1 | S-1 | 3.1 | 10/6/97 | ||||||||||
3.2 | S-1 | 3.1 | 4/8/98 | ||||||||||
3.3 | 10-K | 12/31/13 | 3.3 | 2/28/14 | |||||||||
4.1 | S-1/A | 4.1 | 3/31/98 | ||||||||||
4.2 | 8-K | 4.1 | 5/20/11 | ||||||||||
4.3 | 8-K | 10.1 | 5/20/11 | ||||||||||
4.4 | 8-K | 4.1 | 9/21/12 | ||||||||||
10.1 | S-1/A | 10.1 | 3/31/98 | ||||||||||
10.2 | 10-Q | 6/30/08 | 10.1 | 8/7/08 | |||||||||
10.3 | 10-K | 12/31/05 | 10.2 | 3/16/06 | |||||||||
10.4 | 10-Q | 6/30/08 | 10.2 | 8/7/08 | |||||||||
10.5 | 14A | 4/5/12 | |||||||||||
10.6 | 10-Q | 6/30/12 | 10.3 | 8/2/12 | |||||||||
10.7 | 10-Q | 6/30/12 | 10.4 | 8/2/12 | |||||||||
10.8 | 14A | 4/5/12 | |||||||||||
10.9 | 10-Q | 3/31/07 | 10.4 | 5/4/07 | |||||||||
10.10 | 8-K | 10.1 | 4/1/09 | ||||||||||
10.11 | 8-K | 10.1 | 7/2/12 |
Incorporated by Reference | Filed Herewith | ||||||||||||
Exhibit Number | Exhibit Description | Form | Period Ending | Exhibit | Filing Date | ||||||||
10.12 | 8-K | 10.1 | 12/24/14 | ||||||||||
10.13 | 8-K | 10.4 | 5/27/10 | ||||||||||
10.14 | 8-K | 10.1 | 11/27/12 | ||||||||||
10.15 | 8-K | 10.2 | 11/27/12 | ||||||||||
10.16 | 10-K | 12/31/13 | 10.28 | 2/28/14 | |||||||||
10.17 | 10-Q | 6/30/13 | 10.7 | 8/2/13 | |||||||||
10.18 | 8-K | 10.1 | 5/3/13 | ||||||||||
10.19 | 8-K | 10.1 | 5/10/13 | ||||||||||
10.20 | 10-Q | 6/30/13 | 10.3 | 8/2/13 | |||||||||
10.21 | 10-Q | 9/30/15 | 10.1 | 10/30/15 | |||||||||
10.22 | 10-Q | 3/31/16 | 10.1 | 5/5/16 | |||||||||
10.23 | 10-Q | 3/30/15 | 10.3 | 4/30/15 | |||||||||
10.24 | 10-Q | 6/30/16 | 10.1 | 8/8/16 | |||||||||
10.25 | 10-Q | 9/30/16 | 10.1 | 11/4/16 | |||||||||
10.26 | 8-K | 10.1 | 3/3/17 | ||||||||||
10.27 | 10-Q | 3/31/17 | 10.2 | 5/5/17 |
Incorporated by Reference | Filed Herewith | ||||||||||||
Exhibit Number | Exhibit Description | Form | Period Ending | Exhibit | Filing Date | ||||||||
10.28 | 10-Q | 3/31/17 | 10.3 | 5/5/17 | |||||||||
10.29 | 10-Q | 3/31/17 | 10.4 | 5/5/17 | |||||||||
10.30 | 8-K | 10.1 | 5/5/17 | ||||||||||
10.31 | 8-K | 10.2 | 5/5/17 | ||||||||||
12.1 | X | ||||||||||||
21.1 | X | ||||||||||||
23.1 | X | ||||||||||||
31.1 | X | ||||||||||||
31.2 | X | ||||||||||||
32.1 | X | ||||||||||||
101.INS | XBRL Instance Document | X | |||||||||||
101.SCH | XBRL Taxonomy Extension Schema Document | X | |||||||||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | X | |||||||||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | X | |||||||||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | X | |||||||||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | X |
Year Ended December 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||
(In thousands) | |||||||||||||||||||
Earnings | |||||||||||||||||||
Income before taxes and equity in earnings of unconsolidated affiliate | $ | 303,870 | $ | 215,157 | $ | 67,912 | $ | 136,078 | $ | 123,987 | |||||||||
Interest expense | 84,290 | 83,233 | 84,713 | 107,688 | 103,027 | ||||||||||||||
Amortization of capitalized interest | 494 | — | — | — | — | ||||||||||||||
Amortization of deferred debt issuance costs and premiums | 1,235 | 1,403 | 1,662 | 2,237 | 2,880 | ||||||||||||||
Interest portion of rent (1) | 16,029 | 14,592 | 8,171 | 9,502 | 7,947 | ||||||||||||||
$ | 405,918 | $ | 314,385 | $ | 162,458 | $ | 255,505 | $ | 237,841 | ||||||||||
Fixed Charges | |||||||||||||||||||
Interest expense | $ | 84,290 | $ | 83,233 | $ | 84,713 | $ | 107,688 | $ | 103,027 | |||||||||
Capitalized interest | 52 | 4,686 | 10,079 | 6,912 | 1,740 | ||||||||||||||
Amortization of debt issuance costs and premiums | 1,235 | 1,403 | 1,662 | 2,237 | 2,880 | ||||||||||||||
Interest portion of rent (1) | 16,029 | 14,592 | 8,171 | 9,502 | 7,947 | ||||||||||||||
$ | 101,606 | $ | 103,914 | $ | 104,625 | $ | 126,339 | $ | 115,594 | ||||||||||
Ratio of earnings to fixed charges | 4.0 | 3.0 | 1.6 | 2.0 | 2.1 |
(1) | Represents one-third of total rent expense, which we believe is a reasonable estimate of the interest component of rent expense. |
Subsidiary | Jurisdiction of Organization | |
Amkor Advanced Technology Taiwan, Inc. | Taiwan | |
Amkor Assembly & Test (Shanghai) Co., Ltd. | China | |
Amkor Technology Euroservices, S.A.S. | France | |
Amkor Technology Holding, B.V. | Netherlands | |
Amkor Technology Holding, B.V., Germany (A Branch of a Netherlands Company) | Germany | |
Amkor Technology Korea, Inc. | Korea | |
Amkor Technology Limited | Cayman Islands | |
Amkor Technology Malaysia Sdn. Bhd. | Malaysia | |
Amkor Technology Philippines, Inc. (A Branch of a Singapore Company) | Philippines | |
Amkor Technology Singapore Investment Pte. Ltd. | Singapore | |
Amkor Technology Singapore Holding Pte. Ltd. | Singapore | |
Amkor Technology Taiwan Ltd. | Taiwan | |
Amkor Worldwide Services LLC | Delaware | |
ATEP - Amkor Technology Portugal, S.A. | Portugal | |
Guardian Assets, Inc. | Delaware | |
J-Devices Corporation | Japan | |
Unitive International Ltd. | Curacao |
/s/ Stephen D. Kelley | |
By: | Stephen D. Kelley |
Title: | President and Chief Executive Officer |
Date: | February 23, 2018 |
/s/ Megan Faust | |
By: | Megan Faust |
Title: | Corporate Vice President and Chief Financial Officer |
Date: | February 23, 2018 |
/s/ Stephen D. Kelley | |
By: | Stephen D. Kelley |
Title: | President and Chief Executive Officer |
Date: | February 23, 2018 |
/s/ Megan Faust | |
By: | Megan Faust |
Title: | Corporate Vice President and Chief Financial Officer |
Date: | February 23, 2018 |
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Document and Entity Information - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Feb. 16, 2018 |
Jun. 30, 2017 |
|
Document and Entity Information [Abstract] | |||
Entity Registrant Name | AMKOR TECHNOLOGY, INC. | ||
Entity Central Index Key | 0001047127 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 239,373,301 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 988.4 |
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 264,888 | $ 167,304 | $ 53,893 |
Other comprehensive income (loss), net of tax: | |||
Adjustments to unrealized components of defined benefit pension plans | 5,165 | 2,563 | 1,100 |
Foreign currency translation | 11,092 | 5,783 | (146) |
Equity interest in J-Devices' other comprehensive income (loss) | 0 | 0 | 29,433 |
Total other comprehensive income (loss) | 16,257 | 8,346 | 30,387 |
Comprehensive income | 281,145 | 175,650 | 84,280 |
Comprehensive income attributable to noncontrolling interests | (4,182) | (3,114) | (2,795) |
Comprehensive income attributable to Amkor | $ 276,963 | $ 172,536 | $ 81,485 |
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance | $ 6,946 | $ 9,902 |
Preferred stock designated Series A, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock designated Series A, shares authorized (in shares) | 10,000 | 10,000 |
Preferred stock designated Series A, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 500,000 | 500,000 |
Common stock, shares issued (in shares) | 285,129 | 284,479 |
Common stock, shares outstanding (in shares) | 239,184 | 238,665 |
Treasury stock, shares | 45,945 | 45,814 |
Description of Business and Summary of Significant Accounting Policies |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Description of Business and Summary of Significant Accounting Policies | Description of Business and Summary of Significant Accounting Policies Description of Business Amkor is one of the world’s leading providers of outsourced semiconductor packaging and test services. Amkor pioneered the outsourcing of semiconductor packaging and test services through a predecessor corporation in 1968, and over the years we have built a leading position by:
Basis of Presentation Our Consolidated Financial Statements include the accounts of Amkor Technology, Inc. and our subsidiaries (“Amkor”). Our Consolidated Financial Statements reflect the elimination of all significant inter-company accounts and transactions. On December 30, 2015, we increased our investment in J-Devices to 100% (Note 3). As a result, our accounting for J-Devices changed from the equity method to the consolidation method effective December 30, 2015. The operating results of J-Devices were consolidated beginning in 2016. On May 22, 2017, we completed the purchase of Nanium, S.A. ("Nanium"). Nanium's financial results have been included in our Consolidated Financial Statements from the date of acquisition (Note 3). Our investments in variable interest entities in which we are the primary beneficiary are consolidated. We reflect the remaining portion of variable interest entities and foreign subsidiaries that are not wholly owned as noncontrolling interests. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates, including those related to acquisitions, revenue recognition, income taxes, inventory, long lived assets and contingencies. These estimates are based on management’s best knowledge of current events, historical experience, actions that we may undertake in the future and on various other assumptions that are believed to be reasonable under the circumstances. As a result, actual results could differ materially from these estimates and assumptions. Certain prior year amounts have been reclassified to conform to current year presentation. Consolidation of Variable Interest Entities We have variable interests in certain Philippine realty corporations in which we have a 40% ownership. We lease land and buildings in the Philippines from these entities and we are the primary beneficiary of these arrangements. As of December 31, 2017, the combined book value of the assets and liabilities associated with these Philippine realty corporations included in our Consolidated Balance Sheet was $16.9 million and $0.4 million, respectively. The impact of consolidating these variable interest entities on our Consolidated Statements of Income was not significant, and other than our lease payments, we have not provided any significant assistance or other financial support to these variable interest entities for the years ended December 31, 2017, 2016 or 2015. The creditors of the Philippine realty corporations have no recourse to our general credit. Foreign Currency Translation The U.S. dollar is the functional currency of our subsidiaries other than J-Devices, and the foreign currency asset and liability amounts at these subsidiaries are remeasured into U.S. dollars at end-of-period exchange rates, except for nonmonetary items which are remeasured at historical rates. Foreign currency income and expenses are remeasured at daily exchange rates, except for expenses related to balance sheet amounts which are remeasured at historical exchange rates. Exchange gains and losses arising from remeasurement of foreign currency-denominated monetary assets and liabilities are included in other (income) expense, net in the period in which they occur. The Japanese Yen is the functional currency of J-Devices. The asset and liability amounts of J-Devices are translated into U.S. dollars at end-of-period exchange rates. Income and expenses are translated into U.S. dollars at average exchange rates in effect during the period. The resulting translation adjustments are reported as a component of accumulated other comprehensive income in the stockholders’ equity section of the balance sheet. Assets and liabilities denominated in a currency other than the functional currency are remeasured into the functional currency prior to translation into U.S. dollars, and the resulting transaction exchange gains or losses are included in other expense (income) in the period in which they occur. Risks and Concentrations The semiconductor industry is characterized by rapid technological change, competitive pricing pressures and cyclical market patterns. Our financial results are affected by a wide variety of factors, including general economic conditions worldwide, economic conditions specific to the semiconductor industry, the timely implementation of new package and test technologies, the ability to safeguard patents and intellectual property in a rapidly evolving market and reliance on materials and equipment suppliers. In addition, the semiconductor market has historically been cyclical and subject to significant economic downturns at various times. Our profitability and ability to generate cash from operations is principally dependent upon demand for semiconductors, the utilization of our capacity, semiconductor package mix, the average selling price of our services, our ability to manage our capital expenditures and our ability to control our costs including labor, material, overhead and financing costs. A significant portion of our revenues is concentrated with a small group of customers (Note 18). The loss of a significant customer, a business combination among customers, a reduction in orders or decrease in price from a significant customer or disruption in any of our significant strategic partnerships or other commercial arrangements could have a material adverse effect on our business, liquidity, results of operations, financial condition and cash flows. Financial instruments, for which we are subject to credit risk, consist principally of accounts receivable and cash and cash equivalents. With respect to accounts receivable, we mitigate our credit risk by selling primarily to well-established companies, performing ongoing credit evaluations and making frequent contact with customers. In addition, we may utilize non-recourse factoring to mitigate credit risk when considered appropriate. We have historically mitigated our credit risk with respect to cash and cash equivalents through diversification of our holdings into various high quality money market funds and bank deposit accounts. At December 31, 2017, our cash and cash equivalents were maintained in various U.S. and foreign bank operating and time deposit accounts and invested in U.S. money market funds. Contingencies and Litigation We may be subject to certain legal proceedings, lawsuits and other claims, as discussed in Note 17. We accrue for a loss contingency, including legal proceedings, lawsuits, pending claims and other legal matters, when we conclude that the likelihood of a loss is probable and the amount of the loss can be reasonably estimated. When the reasonable estimate of the loss is within a range of amounts, and no amount in the range constitutes a better estimate than any other amount, we accrue for the amount at the low end of the range. We adjust our accruals from time to time as we receive additional information, but the loss we incur may be significantly greater than or less than the amount we have accrued. We disclose loss contingencies if we believe they are material and there is at least a reasonable possibility that a loss has been incurred. Attorney fees related to legal matters are expensed as incurred. Cash and Cash Equivalents We consider all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Our cash and cash equivalents are maintained in various U.S. and foreign bank operating and time deposit accounts and invested in U.S. money market funds. Restricted Cash Restricted cash, current, consists of short-term cash equivalents used to collateralize our daily banking services. Restricted cash, non-current, mainly consists of collateral to fulfill foreign trade compliance requirements. Inventories Inventories are stated at the lower of cost and net realizable value. Cost is principally determined by standard cost or the weighted moving average method, both of which approximate actual cost. We review and set our standard costs as needed, but at a minimum on an annual basis. We reduce the carrying value of our inventories for the cost of inventory we estimate is excess and obsolete based on the age of our inventories. When a determination is made that the inventory will not be utilized in production or is not saleable, it is written-off. Other Current Assets Other current assets consist principally of prepaid assets and an investment in government securities by a foreign subsidiary to satisfy local regulatory requirements, which is recorded at amortized cost. Property, Plant and Equipment Property, plant and equipment are stated at cost. Depreciation is calculated by the straight-line method over the estimated useful lives of depreciable assets which are as follows:
Cost and accumulated depreciation for property retired or disposed of are removed from the accounts, and any resulting gain or loss is included in earnings. Expenditures for maintenance and repairs are charged to expense as incurred. We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Recoverability of a long-lived asset group to be held and used in operations is measured by a comparison of the carrying amount to the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset group. If such asset group is considered to be impaired, the impairment loss is measured as the amount by which the carrying amount of the asset group exceeds its fair value. Long-lived assets to be disposed of are carried at the lower of cost or fair value less the costs of disposal. Goodwill Goodwill is recorded when the cost of an acquisition exceeds the fair value of the net tangible and identifiable intangible assets acquired. We review goodwill for impairment annually during the fourth quarter of each year and whenever events or changes in circumstances indicate that an impairment may exist. Impairment losses are recorded when the carrying amount of the reporting unit exceeds its fair value. Other Assets Other assets consist principally of deferred tax assets and refundable security deposits. Fair Value Measurements We apply fair value accounting for assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring or nonrecurring basis. We define fair value as the price that would be received from selling an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. See Note 16 for further discussion of fair value measurements. Revenue Recognition We recognize revenue from our packaging and test services, net of value-added or other similar taxes, when there is evidence of an arrangement, delivery has occurred or services have been rendered, fees are fixed or determinable and collectibility is reasonably assured. Generally, these criteria are met and revenue is recognized upon shipment or, in some cases, customer acceptance. If the revenue recognition criteria are not met, we defer the revenue. Deferred revenue generally results from two types of transactions: contractual invoicing at interim points in the packaging and test process prior to shipment of the finished product and customer advances for supply agreements with customers where we commit capacity in exchange for customer prepayment of services. These prepayments are deferred and recorded as customer advances within accrued expenses and other non-current liabilities. We generally do not take ownership of customer-supplied semiconductor wafers. Title and risk of loss remains with the customer for these materials at all times. Accordingly, the cost of the customer-supplied materials is not included in our Consolidated Financial Statements. An allowance for sales credits is recorded as a reduction to sales and accounts receivable during the period of sale such that accounts receivable is reported at its estimated net realizable value. The allowance for sales credits is an estimate of the future credits we will issue for billing adjustments primarily for invoicing corrections and miscellaneous customer claims and is estimated based upon recent credit issuance, historical experience and specific identification of known or expected sales credits at the end of the reporting period. Additionally, provisions are made for doubtful accounts when there is doubt as to the collectibility of accounts receivable. The allowance for doubtful accounts is recorded as bad debt expense and is classified as selling, general and administrative expense. The allowance for doubtful accounts is based upon specific identification of doubtful accounts considering the age of the receivable balance, the customer’s historical payment history and current credit worthiness as well as specific identification of any known or expected collectibility issues. Historically, our allowance for doubtful accounts has been immaterial. Shipping and Handling Fees and Costs Amounts billed to customers for shipping and handling are presented in net sales. Costs incurred for shipping and handling are included in cost of sales. Research and Development Costs Research and development expenses include costs attributable to the conduct of research and development programs primarily related to the development of new package designs or technologies and improving the efficiency and capabilities of our existing production processes. Such costs include salaries, payroll taxes, employee benefit costs, materials, supplies, depreciation and maintenance of research equipment, services provided by outside contractors and the allocable portions of facility costs such as rent, utilities, insurance, repairs and maintenance, depreciation and general support services. All costs associated with research and development are expensed as incurred. Income Taxes Income taxes are accounted for using the asset and liability method. Under this method, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis as well as for net operating loss and tax credit carryforwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided for those deferred tax assets for which it is more likely than not that the related tax benefits will not be realized. We monitor on an ongoing basis our ability to utilize our deferred tax assets and whether there is a need for a related valuation allowance. In evaluating our ability to recover our deferred tax assets in the jurisdictions from which they arise, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies and results of recent operations. For most of our U.S. and foreign deferred tax assets, we consider it more likely than not that we will have sufficient taxable income to allow us to realize these deferred tax assets. However, in the event taxable income falls short of current expectations, we may need to establish a valuation allowance against such deferred tax assets. ASC 740, Accounting for Income Taxes, requires companies to recognize the effect of tax law changes in the period of enactment even though the effective date for most provisions is for tax years beginning after December 31, 2017. Given the significance of the Tax Act, the SEC staff issued Staff Accounting Bulletin No. 118, which allows registrants to record provisional amounts during a one year “measurement period” similar to that used when accounting for business combinations. However, the measurement period is deemed to have ended earlier when the registrant has obtained, prepared and analyzed the information necessary to finalize its accounting. During the measurement period, impacts of the law are expected to be recorded at the time a reasonable estimate for all or a portion of the effects can be made, and provisional amounts can be recognized and adjusted as information becomes available, prepared or analyzed. We have reported provisional amounts for the income tax effects of the Tax Act for which the accounting is incomplete but a reasonable estimate could be determined. There were no specific impacts of the Tax Act that could not be reasonably estimated. Our estimate of the impact of the Tax Act may be adjusted throughout the allowable measurement period as we collect additional information, prepare and analyze the information and evaluate any regulatory guidance or clarifications. Our review is expected to include:
We recognize in our Consolidated Financial Statements the impact of an income tax position, if that position is more likely than not of being sustained on audit, based on the technical merits of the position. Related interest and penalties are classified as income taxes in the financial statements. See Note 6 for more information regarding unrecognized income tax benefits. |
New Accounting Standards |
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New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
New Accounting Standards | New Accounting Standards Recently Adopted Standards In July 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-11, Inventory - Simplifying the Measurement of Inventory (Topic 330). ASU 2015-11 requires inventory to be subsequently measured using the lower of cost and net realizable value, thereby eliminating the market value approach. Net realizable value is defined as the “estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation.” ASU 2015-11 is effective for reporting periods beginning after December 15, 2016 and is applied prospectively. We adopted ASU 2015-11 at January 1, 2017. The adoption of ASU 2015-11 did not have a significant impact on our financial statements or disclosure. In January 2017, the FASB issued ASU 2017-04, Intangible - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment. ASU 2017-04 simplifies the goodwill impairment test by eliminating the second step of the current two-step impairment test. ASU 2017-04 is effective for interim and annual goodwill impairment tests in fiscal years beginning after December 15, 2019 and is applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We adopted ASU 2017-04 at January 1, 2017. The adoption of ASU 2017-04 did not have a significant impact on our financial statements or disclosure. Recently Issued Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 is based on the principle that revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and changes in judgments. ASU 2014-09 permits the use of either full retrospective or modified retrospective methods of adoption. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which defers the effective date by one year to December 15, 2017, for interim and annual reporting periods beginning after that date. In March, April, May and December 2016, the FASB issued ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20, respectively, which provide supplemental guidance and clarification to ASU 2014-09. In September 2017, the FASB issued ASU 2017-13, which provides supplemental guidance and clarification to ASU 2014-09. The new standard will result in a change to the timing of revenue recognition, whereby revenue will be recognized "over time" as services are performed rather than at a "point in time", generally upon shipment. The new standard will also result in an increase in accounts receivables, net and a related decrease in inventories, deferred revenues and accumulated deficit. We will adopt the standard using the full retrospective method to adjust each prior reporting period presented. We are in the process of finalizing the impact that this new standard will have on our consolidated financial statements and disclosure; however, we expect the following impacts to our reported results:
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). ASU 2016-02 requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use asset and a corresponding lease liability. For finance leases the lessee would recognize interest expense and amortization of the right-of-use asset, and for operating leases the lessee would recognize a straight-line lease expense. ASU 2016-02 is effective for reporting periods beginning after December 15, 2018 using a modified retrospective approach. Early adoption is permitted. In September 2017 and January 2018, the FASB issued ASU 2017-13 and ASU 2018-01, respectively, which provide supplemental guidance and clarification to ASU 2016-02. We are currently evaluating the impact that this guidance may have on our financial statements and disclosure. In March 2017, the FASB issued ASU 2017-07, Compensation – Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 requires that the service cost component of net periodic pension costs be presented in the same line item as other compensation costs and all other components of net periodic pension costs to be presented in the statement of income as nonoperating expenses. ASU 2017-07 is effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. We will use the amounts previously disclosed within the prior year financial statements as a practical expedient for retrospective presentation within the consolidated statements of income. ASU 2017-07 will not have a material impact to our financial statements upon adoption. In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Act. ASU 2018-02 is effective for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. Adoption of this ASU should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act is recognized. We are currently evaluating the impact that this guidance may have on our financial statements and disclosure. |
Acquisitions |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions | Acquisitions Acquisition of Nanium On May 22, 2017, we completed the purchase of 100% of the shares of Nanium, a provider of wafer-level fan-out semiconductor packaging solutions. We allocated the purchase price to the assets acquired and liabilities assumed based on their estimated fair values on the date of acquisition. We did not record goodwill as a result of the acquisition. Step-acquisition of J-Devices On December 30, 2015, through the exercise of additional options, we increased our ownership interest in J-Devices from 65.7% to 100% for a purchase price of $105.4 million. As a result, our accounting for J-Devices changed from the equity method to the consolidation method effective December 30, 2015. The operating results of J-Devices were consolidated beginning in 2016. The acquisition of the remaining interest expands our presence in Japan and our business worldwide by capitalizing on our leadership position in the automotive market. Since there were no material transactions from December 30, 2015 to December 31, 2015, and for the convenience of reporting the acquisition for accounting purposes, December 31, 2015 was designated as the acquisition date. The following table summarizes the consideration transferred to acquire J-Devices and the amounts of identifiable assets acquired and liabilities assumed at the acquisition date:
The goodwill is attributable to the workforce of J-Devices, as well as cost savings and synergies expected from combining the operations of J-Devices. It is not deductible for tax purposes. As a result of obtaining control over J-Devices, our previously held equity interest of 65.7% was remeasured to fair value, resulting in a gain of $16.1 million. Additionally, our previously held equity interest in J-Devices' accumulated foreign currency translation adjustments was released upon consolidation of J-Devices, resulting in a loss of $29.6 million. The combined net loss of $13.5 million was recognized in other (income) expense, net (Note 5) in our Consolidated Financial Statements. The fair value of our previously held equity interest in J-Devices was estimated by applying an income approach using the discounted cash flow method. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 fair value measurement. Key assumptions include our estimates of J-Devices’ financial projections, a terminal value based on its expected long-term growth rate and a discount rate based on the weighted-average cost of capital of comparable companies. The following unaudited pro forma consolidated results of operations have been prepared as if the acquisition of J-Devices had occurred on January 1, 2014. The pro forma results include adjustments related to alignment to our accounting policies, the effect of fair value adjustments on property, plant and equipment and the related income tax effect. We also eliminated inter-company activity between the parties in the consolidated results. The pro forma results include the activities that are nonrecurring and not representative of future activities, including the gain of $16.2 million from reversal of a deferred tax asset valuation allowance and the gain of $12.6 million from release of accumulated foreign currency translation adjustments associated with merging our subsidiary into J-Devices in 2014, offset by the loss on acquisition of J-Devices of $13.5 million in 2014. This pro forma data is presented for informational purposes only and does not purport to be indicative of the results of future operations or of the results that would have occurred had the 2015 acquisition taken place on January 1, 2014. The pro forma information does not include any potential revenue enhancements, cost synergies or other operating efficiencies that could result from the acquisition.
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Share-Based Compensation Plans |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Compensation Plans | Share-Based Compensation Plans Our share-based compensation is measured at fair value and expensed over the service period (generally the vesting period). The amount of compensation expense to be recognized is adjusted for an estimated forfeiture rate which is based on historical data. For the years ended December 31, 2017, 2016 and 2015, we recognized share-based compensation attributable to stock options and restricted shares of $5.1 million, $3.3 million and $3.9 million, respectively, primarily in selling, general and administrative expenses. The corresponding deferred income tax benefits for stock options or restricted shares is $2.4 million for 2017 and zero for 2016 and 2015. Equity Incentive Plan Amended and Restated 2007 Equity Incentive Plan. The Amended and Restated 2007 Equity Incentive Plan, (the “2007 Plan”) provides for the grant of the following types of incentive awards: (i) stock options, (ii) restricted stock, (iii) restricted stock units, (iv) stock appreciation rights, (v) performance units and performance shares and (vi) other stock or cash awards. Those eligible for awards include employees, directors and consultants who provide services to Amkor and its subsidiaries. The 2007 Plan is effective through 2027 and can be terminated at the discretion of the Board of Directors. There were originally 17.0 million shares of our common stock reserved for issuance under the 2007 Plan and at December 31, 2017 there were 8.0 million shares available for grant. Stock options Stock options are generally granted with an exercise price equal to the market price of the stock at the date of grant. Substantially all of the options granted are exercisable pursuant to a one to four year vesting schedule and the term of the options granted is no longer than ten years. Upon option exercise, we may issue new shares of common or treasury stock. In order to calculate the fair value of stock options at the date of grant, we use the Black-Scholes option pricing model. Expected volatilities are based on historical performance of our stock. We also use historical data to estimate the timing and amount of option exercises and forfeitures within the valuation model. The expected term of the options is based on evaluations of historical and expected future employee exercise behavior and represents the period of time that options granted are expected to be outstanding. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The following table summarizes our stock option activity for the year ended December 31, 2017:
The following assumptions were used to calculate the weighted-average fair values of the options granted:
Total unrecognized compensation expense from stock options was $9.6 million as of December 31, 2017, which is expected to be recognized over a weighted-average period of approximately 3.0 years beginning January 1, 2017. Restricted Shares We grant restricted shares to directors and employees under the 2007 Plan. Restricted shares granted to directors vest on the earlier of the one year anniversary of the grant date or the date of the next annual meeting of stockholders. All other restricted shares vest ratably over four years, with 6.25% of the shares vesting in equal quarterly installments such that 100% of the shares will become vested on the fourth anniversary of the award, subject to the recipient’s continued employment with us on the applicable vesting dates. In addition, provided that the restricted shares have not been forfeited earlier, for certain grants, the restricted shares will vest upon the recipient’s death or disability, or upon a change in control of Amkor. The value of the restricted shares is determined based on the fair market value of the underlying shares on the date of the grant and is recognized ratably over the vesting period. Upon vesting of restricted stock awards, we may issue new shares of common or treasury stock. The following table summarizes our restricted share activity for the year ended December 31, 2017:
Total unrecognized compensation cost from restricted shares was $1.5 million as of December 31, 2017, which is expected to be recognized over a weighted-average period of approximately 2.8 years beginning January 1, 2017. |
Other Income and Expense |
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Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income and Expense | Other Income and Expense Other income and expense consists of the following:
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Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes On December 22, 2017, the Tax Act was signed into law. The Tax Act reduced the corporate tax rate from 35% to 21%, included a one-time transition tax on unremitted foreign earnings and profits applicable for our fiscal year ended December 31, 2017 and limited tax deductions for interest expense for periods beginning January 1, 2018 which caused a release of valuation allowance. In 2017, we recognized a net benefit for the impact of the Tax Act with components as follows:
In accordance with SEC staff issued Staff Accounting Bulletin No. 118, we have not finalized our accounting and have made a provisional estimate of the impacts of the Tax Act. (See Note 1). Geographic sources of income (loss) before taxes and equity in earnings of unconsolidated affiliate are as follows:
The provision for income taxes includes current federal, state and foreign taxes payable and those deferred because of temporary differences between the financial statement and the tax bases of assets and liabilities. The components of the provision (benefit) for income taxes are as follows:
The reconciliation between the U.S. federal statutory income tax rate of 35% and our income tax expense is as follows:
The change in valuation allowance, excluding the impact of the Tax Act, for 2017, 2016 and 2015 is primarily the result of changes in net operating loss and tax credit carryforwards for which no tax expense or benefit has been recognized. The benefit of foreign income taxed at different rates has increased as foreign income before tax has increased. In 2016, we recognized taxable income and associated foreign income tax credits from the repatriation of foreign earnings and profits in connection with the merger of our Japanese subsidiaries. In 2015, we recognized a loss in connection with our increased ownership interest in J-Devices which is not deductible for income tax purposes. The following is a summary of the components of our deferred tax assets and liabilities:
Valuation allowance against deferred tax assets consist of the following:
U.S. deferred tax assets and liabilities were remeasured down to the new U.S. federal tax rate of 21% as a result of the Tax Act. In connection with our acquisition of Nanium, we acquired a receivable which resulted in the creation of a deferred tax asset. The decrease in our valuation allowance included the reversal of the valuation allowance against most of our U.S. deferred tax assets in connection with the Tax Act offset by the valuation allowance against the deferred tax assets of our Portuguese deferred tax assets, acquired in 2017. As a result of certain capital investments, export commitments and employment levels, income from operations in Korea, Malaysia, the Philippines, Singapore and Taiwan was subject to reduced income tax rates and, in some cases, was exempt from income taxes. We recognized $6.2 million, $5.6 million and $3.3 million in tax benefits as a result of the tax holidays in 2017, 2016 and 2015, respectively. The benefit of the tax holidays on diluted earnings per share was approximately $0.03, $0.02 and $0.01 for 2017, 2016 and 2015, respectively. Our net operating loss carryforwards (“NOL’s”) are as follows:
We monitor on an ongoing basis our ability to utilize our deferred tax assets and whether there is a need for a related valuation allowance. In evaluating our ability to recover our deferred tax assets in the jurisdictions from which they arise, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies and results of recent operations. For most of our U.S. and foreign deferred tax assets, we consider it more likely than not that we will have sufficient taxable income to allow us to realize these deferred tax assets. In prior years, the deferred tax assets along with the U.S. federal and state net operating losses available for carryforward have been fully reserved with valuation allowances. During the fourth quarter of 2017, we determined it was more likely than not that we will have sufficient taxable income to allow us to realize most of our U.S. deferred tax assets, including a substantial portion of our U.S. net operating loss carryforward. Our evaluation considered, among other factors, limitations on the deductibility of interest expense in connection with the Tax Act. At December 31, 2017, a portion of our U.S. federal net operating loss carryforward continues to be reserved with a valuation allowance due to an estimate of the net operating loss carryforward not expected to be realized due to GILTI, due to ownership change limitations from a prior year acquisition as well as certain state net operating loss carryforwards expected to expire unused. Our ability to utilize our U.S. net operating loss carryforwards may be limited in the future if we experience an ownership change as defined by the Internal Revenue Code. At December 31, 2017, we have various tax credits available to be carried forward including U.S. foreign income tax credits totaling $12.6 million which expire in 2026. The deferred tax assets associated with the U.S. foreign income tax credits expected to expire unused have been fully reserved with a valuation allowance. Income tax credits generated by certain of our foreign subsidiaries in 2017, 2016 and 2015 have been recognized in our income tax provision. As a result of the deemed repatriation provision of the Tax Act, U.S. income taxes have been provided on approximately $1.1 billion of the undistributed earnings of our foreign subsidiaries at December 31, 2017. However, we have not provided foreign withholding taxes or state income taxes on the undistributed earnings of our foreign subsidiaries, over which we have sufficient influence to control the distribution of such earnings and have determined that substantially all such earnings have been reinvested indefinitely. These earnings could become subject to foreign withholding tax if they are remitted as dividends. We estimate that repatriation of these foreign earnings would generate withholding taxes and state income taxes of approximately $80.5 million. We operate in and file income tax returns in various U.S. and foreign jurisdictions which are subject to examination by tax authorities. We have tax returns that are open to examination in various jurisdictions for tax years 2010-2017. The open years contain matters that could be subject to differing interpretations of applicable tax laws and regulations related to the amount and/or timing of income, deductions and tax credits. There can be no assurance that the outcome of examinations will be favorable. Our unrecognized tax benefits are subject to change as examinations of specific tax years are completed in the respective jurisdictions. Current examinations include our 2012 and 2013 Philippine income tax returns, 2013-2015 Portuguese income tax returns, and 2010-2014 Malaysian income tax returns. A reconciliation of the beginning and ending gross amount of unrecognized tax benefits is as follows:
The net increase in our unrecognized tax benefits was $4.1 million from December 31, 2016 to December 31, 2017. The increases were primarily related to income attribution and income characterization. At December 31, 2017, all of our gross unrecognized tax benefits would reduce our effective tax rate, if recognized. The liability related to our unrecognized tax benefits is $24.8 million as of December 31, 2017, and is reported as a component of other non-current liabilities. The unrecognized tax benefits presented in the table above also include positions that have reduced deferred tax assets. The balance of accrued and unpaid interest and penalties is $4.2 million as of December 31, 2017 and is included as a component of other non-current liabilities in connection with our unrecognized tax benefits. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share Basic earnings per share (“EPS”) is computed by dividing net income attributable to Amkor common stockholders by the weighted-average number of common shares outstanding during the period. The weighted-average number of common shares outstanding includes restricted shares held by retirement eligible recipients and is reduced for treasury stock. Diluted EPS is computed on the basis of the weighted-average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period. Dilutive potential common shares include outstanding stock options and unvested restricted shares. The following table summarizes the computations of basic and diluted EPS:
The following table summarizes the potential shares of common stock that were excluded from diluted EPS, because the effect of including these potential shares was anti-dilutive:
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Factoring of Accounts Receivable |
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Factoring of Accounts Receivable [Abstract] | |
Factoring of Accounts Receivable | Factoring of Accounts Receivable In certain foreign locations, we use non-recourse factoring arrangements with third party financial institutions to manage our working capital and cash flows. Under this program, we sell receivables to a financial institution for cash at a discount to the face amount. As part of the factoring arrangements, we perform certain collection and administrative functions for the receivables sold. For the year ended December 31, 2017 and 2016, we sold accounts receivable totaling $611.2 million and $574.1 million, respectively, net of discounts and fees of $4.6 million and $2.5 million, respectively. |
Inventories |
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Inventories | Inventories Inventories consist of the following:
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Property, Plant and Equipment |
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Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment consist of the following:
The following table summarizes our depreciation expense:
We had $46.9 million and $44.8 million of costs for our factory and research and development facility in Korea ("K5") in construction in progress as of December 31, 2017 and 2016, respectively. As part of our plan to consolidate factory operations in Korea, we sold the land and buildings comprising our K1 factory in May 2017 for $142.4 million. We received 10% of the sale price at signing in November 2016 and the balance at closing, at which time we recognized a pre-tax gain of $108.1 million. |
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Goodwill | Goodwill Changes in the carrying amount of goodwill are as follows:
Goodwill relates to the increase in our ownership interest in J-Devices to 100% on December 30, 2015 (Note 3). No goodwill impairment has been identified in any of the years presented. |
Accrued Expenses |
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Accrued Expenses | Accrued Expenses Accrued expenses consist of the following:
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Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt Short-term borrowings and long-term debt consist of the following:
Our foreign debt is generally collateralized by the land, buildings and equipment in the respective locations. The carrying value of the collateral exceeds the carrying amount of the debt. Interest Rates Interest is payable semiannually on our senior notes and quarterly or monthly on our other fixed- and variable-rate debt. Refer to the table above for the interest rates on our fixed-rate debt and to the table below for the interest rates on our variable-rate debt.
Compliance with Debt Covenants The debt of Amkor Technology, Inc. is structurally subordinated in right of payment to all existing and future debt and other liabilities of our subsidiaries. The agreements governing our indebtedness contain a number of affirmative and negative covenants which restrict our ability to pay dividends and could restrict our operations. We have never paid a dividend to our stockholders and we do not have any present plans for doing so. We were in compliance with all of our covenants at December 31, 2017 and 2016. Maturities
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Pension and Severance Plans |
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Defined Benefit Plan [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension and Severance Plans | Pension and Severance Plans Korean Severance Plan Our subsidiary in Korea maintains an unfunded severance plan that covers certain employees that were employed prior to August 1, 2015. To the extent eligible employees are terminated, our subsidiary in Korea would be required to make lump-sum severance payments on behalf of these eligible employees for service provided prior to August 1, 2015. Factors used to determine severance benefits include employees' length of service, seniority and rate of pay. The employees' length of service and seniority are fixed as of July 31, 2015. The employees' rate of pay is adjusted to the rate of pay at the time of termination. Accrued severance benefits are estimated assuming all eligible employees were to terminate their employment at the balance sheet date. Our contributions to the National Pension Plan of the Republic of Korea are deducted from accrued severance benefit liabilities. On August 1, 2015, our subsidiary in Korea began sponsoring a defined benefit pension plan and a defined contribution plan. Existing employees at that time were given the option of choosing either a defined benefit pension plan or a defined contribution plan for their future benefits and new employees since that date are enrolled in a defined contribution plan. The changes to the balance of our accrued severance plan obligations are as follows:
Foreign Defined Benefit Pension Plans Our subsidiaries in Japan, Korea, Malaysia, the Philippines and Taiwan sponsor defined benefit plans (the “Plans”). Charges to expense are based upon actuarial analyses. The following table summarizes the changes to the Plans’ benefit obligations, fair value of the Plans’ assets and the funded status of the Plans at December 31, 2017 and 2016:
The accumulated benefit obligation as of December 31, 2017 and 2016 was $113.6 million and $94.5 million, respectively. The following table summarizes, by component, the change in accumulated other comprehensive income (loss), net of tax related to our Plans:
Information for pension plans with benefit obligations in excess of plan assets is as follows:
The following table summarizes total pension expense:
As a result of the adoption of a defined benefit pension plan in Korea beginning on August 1, 2015, and the acquisition of J-Devices on December 30, 2015, our net periodic pension cost has increased from the prior period. The following table summarizes the weighted-average assumptions used in computing the net periodic pension cost and projected benefit obligations:
The measurement date for determining the Plans’ assets and benefit obligations is December 31, each year. Discount rates are generally derived from yield curves constructed from high-quality corporate or foreign government bonds, for which the timing and amount of cash outflows approximate the estimated payouts. The expected rate of return assumption is based on weighted-average expected returns for each asset class. Expected returns reflect a combination of historical performance analysis and the forward-looking views of the financial markets and include input from our actuaries. We have no control over the direction of our investments in our defined benefit plans in Taiwan as the local Labor Standards Law Fund mandates such contributions into a cash account balance at the Bank of Taiwan. Our defined benefit pension plan in Malaysia is a non-funded plan, and as such, no asset exists related to this plan. Our investment strategies for our defined benefit plans in Japan, Korea and the Philippines, are based on long-term, sustained asset growth through low to medium risk investments. The current rate of return assumption targets are based on asset allocation strategies as follows:
The fair value of our pension plan assets, by asset category utilizing the fair value hierarchy as discussed in Note 16, is as follows:
The Taiwan retirement fund category of our plan assets represents accounts that our subsidiaries in Taiwan have in a government labor retirement fund in the custody of the Bank of Taiwan. The accounts earn a minimum guaranteed rate of return and are invested in a mix of cash, domestic and foreign equity securities and domestic and foreign debt securities. We expect to make contributions of approximately $23 million during 2018. We closely monitor the funded status of the Plans with respect to legislative requirements. We intend to make at least the minimum contribution required by law each year. The estimated future benefit payments related to our foreign defined benefit plans are as follows:
Defined Contribution Plans We sponsor defined contribution plans in Korea, Malaysia, Taiwan and the U.S. Total defined contribution expense was $10.4 million, $8.8 million and $8.6 million for 2017, 2016 and 2015, respectively. |
Accumulated Other Comprehensive Income (Loss) |
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Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The following table reflects the changes in accumulated other comprehensive income (loss), net of tax:
Amounts reclassified out of accumulated other comprehensive income (loss) are included as a component of net periodic pension cost (Note 14) or other (income) expense, net. |
Fair Value Measurements |
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Fair Value Measurements | Fair Value Measurements The accounting framework for determining fair value includes a hierarchy for ranking the quality and reliability of the information used to measure fair value, which enables the reader of the financial statements to assess the inputs used to develop those measurements. The fair value hierarchy consists of three tiers as follows: Level 1, defined as quoted market prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, model-based valuation techniques for which all significant assumptions are observable in the market or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3, defined as unobservable inputs that are not corroborated by market data. The fair values of cash, accounts receivable, trade accounts payable, capital expenditures payable, and certain other current assets and accrued expenses approximate carrying values because of their short-term nature. The carrying value of certain other non-current assets and liabilities approximates fair value. Our assets and liabilities recorded at fair value on a recurring basis include cash equivalent money market funds and restricted cash money market funds. We also review goodwill for impairment annually during the fourth quarter of each year. Cash equivalent money market funds and restricted cash money market funds are invested in U.S. money market funds and various U.S. and foreign bank operating and time deposit accounts, which are due on demand or carry a maturity date of less than three months when purchased. No restrictions have been imposed on us regarding withdrawal of balances with respect to our cash equivalents as a result of liquidity or other credit market issues affecting the money market funds we invest in or the counterparty financial institutions holding our deposits. Money market funds are valued using quoted market prices in active markets for identical assets. Recurring fair value measurements consist of the following:
We also measure certain assets and liabilities, including property, plant and equipment and goodwill, at fair value on a nonrecurring basis. We measure the fair value of our debt for disclosure purposes. The following table presents the fair value of financial instruments that are not recorded at fair value on a recurring basis:
The estimated fair value of our senior notes is based primarily on quoted market prices reported on or near the respective balance sheet dates. The estimated fair value of our revolving credit facilities and term loans is calculated using a discounted cash flow analysis, which utilizes market based assumptions including forward interest rates adjusted for credit risk. |
Commitments and Contingencies |
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Commitments and Contingencies | Commitments and Contingencies We generally warrant that our services will be performed in a professional and workmanlike manner and in compliance with our customers’ specifications. We accrue costs for known warranty issues. Historically, our warranty costs have been immaterial. Legal Proceedings We are involved in claims and legal proceedings and may become involved in other legal matters arising in the ordinary course of our business. We evaluate these claims and legal matters on a case-by-case basis to make a determination as to the impact, if any, on our business, liquidity, results of operations, financial condition or cash flows. Although the outcome of these matters is uncertain, we believe that the ultimate outcome of these claims and proceedings, individually and in the aggregate, will not have a material adverse impact to us. Our evaluation of the potential impact of these claims and legal proceedings on our business, liquidity, results of operations, financial condition or cash flows could change in the future. Settlement of Patent License Litigation Under the terms of a January 2015 patent license litigation settlement, Amkor agreed to pay a total of $155.0 million in 16 equal quarterly recurring payments commencing in the first quarter of 2015, and continuing through the fourth quarter of 2018. During the three months ended December 31, 2014, we recorded a pre-tax charge of $87.1 million, of which $75.3 million was charged to cost of sales and $11.8 million was charged to interest expense. This charge reflected the aggregate amount due under the settlement agreement, net of amounts previously reserved. At December 31, 2017, the remaining amount we owe under our settlement agreement was $38.8 million. The liability is recorded in accrued expenses (Note 12) in our Consolidated Financial Statements. We will also charge $1.0 million of the amount owed to interest expense over the remaining term of the arrangement. Leases Future minimum lease payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year are:
Rent expense was $48.1 million, $43.8 million and $24.5 million for 2017, 2016 and 2015, respectively. In order to provide packaging and test services, we purchase materials under various long-term supply contracts. Future minimum payments to be made under these contracts for the period 2018 through 2028 are $18.3 million. |
Business Segments, Customer Concentrations and Geographic Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segments, Customer Concentrations and Geographic Information | Business Segments, Customer Concentrations and Geographic Information We operate as a single operating segment as managed by our Chief Executive Officer, who is considered our chief operating decision maker ("CODM"). The CODM bears the ultimate responsibility for, and is actively engaged in, the allocation of resources and the evaluation of our operating and financial results. We have concluded that we have a single operating segment based on the following:
Net sales by product group consist of the following:
Net sales by region based on customer headquarters location consist of the following:
One customer accounted for 14.3%, 15.8%, and 11.0% of net sales in 2017, 2016 and 2015, respectively. A second customer accounted for 12.7% and 14.4% of net sales in 2016 and 2015, respectively. Net sales for our second customer were below 10% in 2017. Property, plant and equipment, net, based on physical location, consist of the following:
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Quarterly Results (Unaudited) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Results (Unaudited) | Quarterly Results (unaudited) The following table sets forth our consolidated unaudited financial data for the last eight quarters ended December 31, 2017. We believe that we have included all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of our selected quarterly data. The calculation of basic and diluted per share amounts for each quarter is based on the weighted-average shares outstanding for that period; consequently, the sum of the quarters may not necessarily be equal to the full year basic and diluted net income per share.
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Schedule II - Valuation and Qualifying Accounts |
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Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule II - Valuation and Qualifying Accounts | SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS
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Description of Business and Summary of Significant Accounting Policies (Policies) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||
Description of Business | Amkor is one of the world’s leading providers of outsourced semiconductor packaging and test services. Amkor pioneered the outsourcing of semiconductor packaging and test services through a predecessor corporation in 1968, and over the years we have built a leading position by:
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Basis of Presentation | Basis of Presentation Our Consolidated Financial Statements include the accounts of Amkor Technology, Inc. and our subsidiaries (“Amkor”). Our Consolidated Financial Statements reflect the elimination of all significant inter-company accounts and transactions. On December 30, 2015, we increased our investment in J-Devices to 100% (Note 3). As a result, our accounting for J-Devices changed from the equity method to the consolidation method effective December 30, 2015. The operating results of J-Devices were consolidated beginning in 2016. On May 22, 2017, we completed the purchase of Nanium, S.A. ("Nanium"). Nanium's financial results have been included in our Consolidated Financial Statements from the date of acquisition (Note 3). Our investments in variable interest entities in which we are the primary beneficiary are consolidated. We reflect the remaining portion of variable interest entities and foreign subsidiaries that are not wholly owned as noncontrolling interests. |
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Use of Estimates | The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates, including those related to acquisitions, revenue recognition, income taxes, inventory, long lived assets and contingencies. These estimates are based on management’s best knowledge of current events, historical experience, actions that we may undertake in the future and on various other assumptions that are believed to be reasonable under the circumstances. As a result, actual results could differ materially from these estimates and assumptions. |
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Consolidation of Variable Interest Entities | Consolidation of Variable Interest Entities We have variable interests in certain Philippine realty corporations in which we have a 40% ownership. We lease land and buildings in the Philippines from these entities and we are the primary beneficiary of these arrangements. As of December 31, 2017, the combined book value of the assets and liabilities associated with these Philippine realty corporations included in our Consolidated Balance Sheet was $16.9 million and $0.4 million, respectively. The impact of consolidating these variable interest entities on our Consolidated Statements of Income was not significant, and other than our lease payments, we have not provided any significant assistance or other financial support to these variable interest entities for the years ended December 31, 2017, 2016 or 2015. The creditors of the Philippine realty corporations have no recourse to our general credit. |
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Foreign Currency Translation | Foreign Currency Translation The U.S. dollar is the functional currency of our subsidiaries other than J-Devices, and the foreign currency asset and liability amounts at these subsidiaries are remeasured into U.S. dollars at end-of-period exchange rates, except for nonmonetary items which are remeasured at historical rates. Foreign currency income and expenses are remeasured at daily exchange rates, except for expenses related to balance sheet amounts which are remeasured at historical exchange rates. Exchange gains and losses arising from remeasurement of foreign currency-denominated monetary assets and liabilities are included in other (income) expense, net in the period in which they occur. The Japanese Yen is the functional currency of J-Devices. The asset and liability amounts of J-Devices are translated into U.S. dollars at end-of-period exchange rates. Income and expenses are translated into U.S. dollars at average exchange rates in effect during the period. The resulting translation adjustments are reported as a component of accumulated other comprehensive income in the stockholders’ equity section of the balance sheet. Assets and liabilities denominated in a currency other than the functional currency are remeasured into the functional currency prior to translation into U.S. dollars, and the resulting transaction exchange gains or losses are included in other expense (income) in the period in which they occur. |
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Risks and Concentrations | Risks and Concentrations The semiconductor industry is characterized by rapid technological change, competitive pricing pressures and cyclical market patterns. Our financial results are affected by a wide variety of factors, including general economic conditions worldwide, economic conditions specific to the semiconductor industry, the timely implementation of new package and test technologies, the ability to safeguard patents and intellectual property in a rapidly evolving market and reliance on materials and equipment suppliers. In addition, the semiconductor market has historically been cyclical and subject to significant economic downturns at various times. Our profitability and ability to generate cash from operations is principally dependent upon demand for semiconductors, the utilization of our capacity, semiconductor package mix, the average selling price of our services, our ability to manage our capital expenditures and our ability to control our costs including labor, material, overhead and financing costs. A significant portion of our revenues is concentrated with a small group of customers (Note 18). The loss of a significant customer, a business combination among customers, a reduction in orders or decrease in price from a significant customer or disruption in any of our significant strategic partnerships or other commercial arrangements could have a material adverse effect on our business, liquidity, results of operations, financial condition and cash flows. Financial instruments, for which we are subject to credit risk, consist principally of accounts receivable and cash and cash equivalents. With respect to accounts receivable, we mitigate our credit risk by selling primarily to well-established companies, performing ongoing credit evaluations and making frequent contact with customers. In addition, we may utilize non-recourse factoring to mitigate credit risk when considered appropriate. We have historically mitigated our credit risk with respect to cash and cash equivalents through diversification of our holdings into various high quality money market funds and bank deposit accounts. At December 31, 2017, our cash and cash equivalents were maintained in various U.S. and foreign bank operating and time deposit accounts and invested in U.S. money market funds. |
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Contingencies and Litigation | Contingencies and Litigation We may be subject to certain legal proceedings, lawsuits and other claims, as discussed in Note 17. We accrue for a loss contingency, including legal proceedings, lawsuits, pending claims and other legal matters, when we conclude that the likelihood of a loss is probable and the amount of the loss can be reasonably estimated. When the reasonable estimate of the loss is within a range of amounts, and no amount in the range constitutes a better estimate than any other amount, we accrue for the amount at the low end of the range. We adjust our accruals from time to time as we receive additional information, but the loss we incur may be significantly greater than or less than the amount we have accrued. We disclose loss contingencies if we believe they are material and there is at least a reasonable possibility that a loss has been incurred. Attorney fees related to legal matters are expensed as incurred. |
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Cash and Cash Equivalents | Cash and Cash Equivalents We consider all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Our cash and cash equivalents are maintained in various U.S. and foreign bank operating and time deposit accounts and invested in U.S. money market funds. |
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Restricted Cash | Restricted Cash Restricted cash, current, consists of short-term cash equivalents used to collateralize our daily banking services. Restricted cash, non-current, mainly consists of collateral to fulfill foreign trade compliance requirements. |
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Inventories | Inventories Inventories are stated at the lower of cost and net realizable value. Cost is principally determined by standard cost or the weighted moving average method, both of which approximate actual cost. We review and set our standard costs as needed, but at a minimum on an annual basis. We reduce the carrying value of our inventories for the cost of inventory we estimate is excess and obsolete based on the age of our inventories. When a determination is made that the inventory will not be utilized in production or is not saleable, it is written-off. |
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Other Current Assets | Other Current Assets Other current assets consist principally of prepaid assets and an investment in government securities by a foreign subsidiary to satisfy local regulatory requirements, which is recorded at amortized cost. |
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Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are stated at cost. Depreciation is calculated by the straight-line method over the estimated useful lives of depreciable assets which are as follows:
Cost and accumulated depreciation for property retired or disposed of are removed from the accounts, and any resulting gain or loss is included in earnings. Expenditures for maintenance and repairs are charged to expense as incurred. We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Recoverability of a long-lived asset group to be held and used in operations is measured by a comparison of the carrying amount to the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset group. If such asset group is considered to be impaired, the impairment loss is measured as the amount by which the carrying amount of the asset group exceeds its fair value. Long-lived assets to be disposed of are carried at the lower of cost or fair value less the costs of disposal. |
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Goodwill | Goodwill Goodwill is recorded when the cost of an acquisition exceeds the fair value of the net tangible and identifiable intangible assets acquired. We review goodwill for impairment annually during the fourth quarter of each year and whenever events or changes in circumstances indicate that an impairment may exist. Impairment losses are recorded when the carrying amount of the reporting unit exceeds its fair value. |
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Other Assets | Other Assets Other assets consist principally of deferred tax assets and refundable security deposits. |
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Fair Value Measurements | Fair Value Measurements We apply fair value accounting for assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring or nonrecurring basis. We define fair value as the price that would be received from selling an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. See Note 16 for further discussion of fair value measurements. |
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Revenue Recognition | Revenue Recognition We recognize revenue from our packaging and test services, net of value-added or other similar taxes, when there is evidence of an arrangement, delivery has occurred or services have been rendered, fees are fixed or determinable and collectibility is reasonably assured. Generally, these criteria are met and revenue is recognized upon shipment or, in some cases, customer acceptance. If the revenue recognition criteria are not met, we defer the revenue. Deferred revenue generally results from two types of transactions: contractual invoicing at interim points in the packaging and test process prior to shipment of the finished product and customer advances for supply agreements with customers where we commit capacity in exchange for customer prepayment of services. These prepayments are deferred and recorded as customer advances within accrued expenses and other non-current liabilities. We generally do not take ownership of customer-supplied semiconductor wafers. Title and risk of loss remains with the customer for these materials at all times. Accordingly, the cost of the customer-supplied materials is not included in our Consolidated Financial Statements. An allowance for sales credits is recorded as a reduction to sales and accounts receivable during the period of sale such that accounts receivable is reported at its estimated net realizable value. The allowance for sales credits is an estimate of the future credits we will issue for billing adjustments primarily for invoicing corrections and miscellaneous customer claims and is estimated based upon recent credit issuance, historical experience and specific identification of known or expected sales credits at the end of the reporting period. Additionally, provisions are made for doubtful accounts when there is doubt as to the collectibility of accounts receivable. The allowance for doubtful accounts is recorded as bad debt expense and is classified as selling, general and administrative expense. The allowance for doubtful accounts is based upon specific identification of doubtful accounts considering the age of the receivable balance, the customer’s historical payment history and current credit worthiness as well as specific identification of any known or expected collectibility issues. Historically, our allowance for doubtful accounts has been immaterial. |
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Shipping and Handling Fees and Costs | Shipping and Handling Fees and Costs Amounts billed to customers for shipping and handling are presented in net sales. Costs incurred for shipping and handling are included in cost of sales. |
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Research and Development Costs | Research and Development Costs Research and development expenses include costs attributable to the conduct of research and development programs primarily related to the development of new package designs or technologies and improving the efficiency and capabilities of our existing production processes. Such costs include salaries, payroll taxes, employee benefit costs, materials, supplies, depreciation and maintenance of research equipment, services provided by outside contractors and the allocable portions of facility costs such as rent, utilities, insurance, repairs and maintenance, depreciation and general support services. All costs associated with research and development are expensed as incurred. |
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Income Taxes | Income Taxes Income taxes are accounted for using the asset and liability method. Under this method, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis as well as for net operating loss and tax credit carryforwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided for those deferred tax assets for which it is more likely than not that the related tax benefits will not be realized. We monitor on an ongoing basis our ability to utilize our deferred tax assets and whether there is a need for a related valuation allowance. In evaluating our ability to recover our deferred tax assets in the jurisdictions from which they arise, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies and results of recent operations. For most of our U.S. and foreign deferred tax assets, we consider it more likely than not that we will have sufficient taxable income to allow us to realize these deferred tax assets. However, in the event taxable income falls short of current expectations, we may need to establish a valuation allowance against such deferred tax assets. ASC 740, Accounting for Income Taxes, requires companies to recognize the effect of tax law changes in the period of enactment even though the effective date for most provisions is for tax years beginning after December 31, 2017. Given the significance of the Tax Act, the SEC staff issued Staff Accounting Bulletin No. 118, which allows registrants to record provisional amounts during a one year “measurement period” similar to that used when accounting for business combinations. However, the measurement period is deemed to have ended earlier when the registrant has obtained, prepared and analyzed the information necessary to finalize its accounting. During the measurement period, impacts of the law are expected to be recorded at the time a reasonable estimate for all or a portion of the effects can be made, and provisional amounts can be recognized and adjusted as information becomes available, prepared or analyzed. We have reported provisional amounts for the income tax effects of the Tax Act for which the accounting is incomplete but a reasonable estimate could be determined. There were no specific impacts of the Tax Act that could not be reasonably estimated. Our estimate of the impact of the Tax Act may be adjusted throughout the allowable measurement period as we collect additional information, prepare and analyze the information and evaluate any regulatory guidance or clarifications. Our review is expected to include:
We recognize in our Consolidated Financial Statements the impact of an income tax position, if that position is more likely than not of being sustained on audit, based on the technical merits of the position. Related interest and penalties are classified as income taxes in the financial statements. See Note 6 for more information regarding unrecognized income tax benefits. We monitor on an ongoing basis our ability to utilize our deferred tax assets and whether there is a need for a related valuation allowance. In evaluating our ability to recover our deferred tax assets in the jurisdictions from which they arise, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies and results of recent operations. For most of our U.S. and foreign deferred tax assets, we consider it more likely than not that we will have sufficient taxable income to allow us to realize these deferred tax assets. |
Description of Business and Summary of Significant Accounting Policies (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||
Property Plant and Equipment Policy | Depreciation is calculated by the straight-line method over the estimated useful lives of depreciable assets which are as follows:
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New Accounting Standards (Tables) |
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New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | We are in the process of finalizing the impact that this new standard will have on our consolidated financial statements and disclosure; however, we expect the following impacts to our reported results:
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Acquisitions (Tables) |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Consideration Transferred and Identifiable Assets and Liabilities Assumed | The following table summarizes the consideration transferred to acquire J-Devices and the amounts of identifiable assets acquired and liabilities assumed at the acquisition date:
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Schedule of Pro Forma Information | The pro forma information does not include any potential revenue enhancements, cost synergies or other operating efficiencies that could result from the acquisition.
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Share-Based Compensation Plans (Tables) |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of all common stock option activity | The following table summarizes our stock option activity for the year ended December 31, 2017:
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Assumptions used in valuing the weighted average fair values of the options granted | The following assumptions were used to calculate the weighted-average fair values of the options granted:
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Restricted share activity | The following table summarizes our restricted share activity for the year ended December 31, 2017:
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Other Income and Expense (Tables) |
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Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Nonoperating Income (Expense) | Other income and expense consists of the following:
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Income Taxes (Tables) |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Income before Income Tax, Domestic and Foreign | Geographic sources of income (loss) before taxes and equity in earnings of unconsolidated affiliate are as follows:
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Schedule of Components of Income Tax Expense (Benefit) | The components of the provision (benefit) for income taxes are as follows:
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Schedule of Effective Income Tax Rate Reconciliation | The reconciliation between the U.S. federal statutory income tax rate of 35% and our income tax expense is as follows:
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Schedule of Income Tax Expense (Benefit) Impact of Tax Cuts and Jobs Act of 2017 | In 2017, we recognized a net benefit for the impact of the Tax Act with components as follows:
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Schedule of Deferred Tax Assets and Liabilities | The following is a summary of the components of our deferred tax assets and liabilities:
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Summary of Operating Loss Carryforwards | Our net operating loss carryforwards (“NOL’s”) are as follows:
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Schedule of Unrecognized Tax Benefits Rollforward | A reconciliation of the beginning and ending gross amount of unrecognized tax benefits is as follows:
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Summary of Valuation Allowance | Valuation allowance against deferred tax assets consist of the following:
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Earnings Per Share (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of basic and diluted earnings per share | The following table summarizes the computations of basic and diluted EPS:
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Antidilutive effect of potential shares of common stock that were excluded from diluted earnings per share | The following table summarizes the potential shares of common stock that were excluded from diluted EPS, because the effect of including these potential shares was anti-dilutive:
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Inventories (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Inventories consist of the following:
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Property, Plant and Equipment (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Property, plant and equipment | Property, plant and equipment consist of the following:
The following table summarizes our depreciation expense:
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Goodwill (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||
Schedule of Goodwill | Changes in the carrying amount of goodwill are as follows:
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Accrued Expenses (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summarized Accrued expenses | Accrued expenses consist of the following:
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Debt (Tables) |
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Short term Borrowings And Long term Debt | Short-term borrowings and long-term debt consist of the following:
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Schedule of Interest Rates | Refer to the table above for the interest rates on our fixed-rate debt and to the table below for the interest rates on our variable-rate debt.
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Schedule of Maturities of Long-term Debt | Maturities
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Pension and Severance Plans (Tables) |
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Dec. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Defined Benefit Plan [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Accrued Severance Obligation | The changes to the balance of our accrued severance plan obligations are as follows:
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Schedule of Changes in Projected Benefit Obligations and Fair Value of Plan Assets | The following table summarizes the changes to the Plans’ benefit obligations, fair value of the Plans’ assets and the funded status of the Plans at December 31, 2017 and 2016:
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Schedule of Amounts Recognized in Balance Sheet |
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Schedule of Amounts Recognized in Other Comprehensive Income (Loss) | The following table summarizes, by component, the change in accumulated other comprehensive income (loss), net of tax related to our Plans:
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Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets | Information for pension plans with benefit obligations in excess of plan assets is as follows:
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Components of net periodic pension cost | The following table summarizes total pension expense:
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Schedule of Assumptions Used | The following table summarizes the weighted-average assumptions used in computing the net periodic pension cost and projected benefit obligations:
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Schedule of Allocation of Plan Assets | The current rate of return assumption targets are based on asset allocation strategies as follows:
The fair value of our pension plan assets, by asset category utilizing the fair value hierarchy as discussed in Note 16, is as follows:
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Schedule of Expected Benefit Payments | The estimated future benefit payments related to our foreign defined benefit plans are as follows:
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Accumulated Other Comprehensive Income (Loss) (Tables) |
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table reflects the changes in accumulated other comprehensive income (loss), net of tax:
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Fair Value Measurements (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Valuation of money market funds and restricted cash using quoted market prices in active markets for identical assets | Recurring fair value measurements consist of the following:
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Financial instruments that are not recorded at fair value | The following table presents the fair value of financial instruments that are not recorded at fair value on a recurring basis:
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Commitments and Contingencies (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year are:
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Business Segments, Customer Concentrations and Geographic Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from External Customers by Products and Services | Net sales by product group consist of the following:
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Net sales by country, and property, plant and equipment by physical location | Net sales by region based on customer headquarters location consist of the following:
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Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country | Property, plant and equipment, net, based on physical location, consist of the following:
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Quarterly Results (Unaudited) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Financial Information | The following table sets forth our consolidated unaudited financial data for the last eight quarters ended December 31, 2017. We believe that we have included all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of our selected quarterly data. The calculation of basic and diluted per share amounts for each quarter is based on the weighted-average shares outstanding for that period; consequently, the sum of the quarters may not necessarily be equal to the full year basic and diluted net income per share.
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Description of Business and Summary of Significant Accounting Policies (Variable Interest Entity) (Details) - Variable Interest Entity, Primary Beneficiary $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2017
USD ($)
| |
Variable Interest Entity [Line Items] | |
Ownership Percentage | 40.00% |
Variable Interest Entity, Consolidated, Carrying Amount, Assets | $ 16.9 |
Variable Interest Entity, Consolidated, Carrying Amount, Liabilities | $ 0.4 |
New Accounting Standards Adjustment for new accounting pronouncement (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Statement: | |||||||||||
Net sales | $ 1,148,423 | $ 1,135,027 | $ 989,447 | $ 913,600 | $ 1,021,613 | $ 1,086,014 | $ 917,326 | $ 868,682 | $ 4,186,497 | $ 3,893,635 | $ 2,884,603 |
Cost of sales | 3,429,224 | 3,198,158 | 2,405,338 | ||||||||
Net income | $ 101,943 | $ 55,630 | $ 116,459 | $ (9,144) | $ 101,202 | $ 61,141 | $ 5,366 | $ (405) | $ 264,888 | $ 167,304 | $ 53,893 |
Basic (in dollars per share) | $ 0.42 | $ 0.23 | $ 0.48 | $ (0.04) | $ 0.42 | $ 0.25 | $ 0.02 | $ 0.00 | $ 1.09 | $ 0.69 | $ 0.22 |
Diluted (in dollars per share) | $ 0.42 | $ 0.23 | $ 0.48 | $ (0.04) | $ 0.42 | $ 0.25 | $ 0.02 | $ 0.00 | $ 1.09 | $ 0.69 | $ 0.22 |
Balance Sheet: | |||||||||||
Accounts receivable, net | $ 692,287 | $ 563,107 | $ 692,287 | $ 563,107 | |||||||
Inventories | 326,492 | 267,990 | 326,492 | 267,990 | |||||||
Accrued expenses | 374,598 | 338,669 | 374,598 | 338,669 | |||||||
(Accumulated deficit) retained earnings | (42,851) | $ (303,557) | (42,851) | (303,557) | |||||||
New Revenue Standard Adjustment (Estimate) | Accounting Standards Update 2014-09 | |||||||||||
Income Statement: | |||||||||||
Net sales | 24,000 | 36,000 | |||||||||
Cost of sales | 17,000 | 21,000 | |||||||||
Net income | $ 5,000 | $ 11,000 | |||||||||
Basic (in dollars per share) | $ 0.02 | $ 0.05 | |||||||||
Diluted (in dollars per share) | $ 0.02 | $ 0.04 | |||||||||
Balance Sheet: | |||||||||||
Accounts receivable, net | 106,000 | $ 106,000 | |||||||||
Inventories | (113,000) | (113,000) | |||||||||
Accrued expenses | (48,000) | (48,000) | |||||||||
(Accumulated deficit) retained earnings | 31,000 | 31,000 | |||||||||
As Adjusted (Estimate) | Accounting Standards Update 2014-09 | |||||||||||
Income Statement: | |||||||||||
Net sales | 4,210,497 | $ 3,929,635 | |||||||||
Cost of sales | 3,446,224 | 3,219,158 | |||||||||
Net income | $ 269,888 | $ 178,304 | |||||||||
Basic (in dollars per share) | $ 1.11 | $ 0.74 | |||||||||
Diluted (in dollars per share) | $ 1.11 | $ 0.73 | |||||||||
Balance Sheet: | |||||||||||
Accounts receivable, net | 798,287 | $ 798,287 | |||||||||
Inventories | 213,492 | 213,492 | |||||||||
Accrued expenses | 326,598 | 326,598 | |||||||||
(Accumulated deficit) retained earnings | $ (11,851) | $ (11,851) |
Acquisitions (Step Acquisition of J-Devices) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||
---|---|---|---|---|---|---|---|
Dec. 30, 2015 |
Dec. 31, 2015 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
May 22, 2017 |
Dec. 29, 2015 |
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Business Acquisition [Line Items] | |||||||
Payments to acquire investment | $ 0 | $ 0 | $ 12,908 | ||||
J-Devices | |||||||
Business Acquisition [Line Items] | |||||||
Ownership Interest (percent) | 65.70% | ||||||
Ownership interest in acquiree (percent) | 100.00% | ||||||
Nanium | |||||||
Business Acquisition [Line Items] | |||||||
Ownership interest acquired (as a percent) | 100.00% | ||||||
J-Devices | |||||||
Business Acquisition [Line Items] | |||||||
Ownership interest in acquiree (percent) | 100.00% | ||||||
Payments to acquire investment | $ 105,400 | ||||||
Equity interest fair value remeasurement gain | $ 16,100 | ||||||
Business combination, step acquisition, foreign currency translation gain (loss) | (29,600) | ||||||
Gain (loss) from acquisition of J-Devices | $ (13,500) |
Acquisitions (Consideration Transferred and Identifiable Assets and Liabilities Assumed) (Details) - USD ($) $ in Thousands |
Dec. 30, 2015 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|---|---|
Recognized amounts of identifiable assets acquired and liabilities assumed: | ||||
Goodwill | $ 25,036 | $ 24,122 | $ 23,409 | |
J-Devices | ||||
Fair value of consideration transferred: | ||||
Cash | $ 105,391 | |||
Fair value of our previously held equity interest in J-Devices | 160,087 | |||
Total | 265,478 | |||
Recognized amounts of identifiable assets acquired and liabilities assumed: | ||||
Cash | 127,968 | |||
Accounts receivable | 180,177 | |||
Inventory | 42,502 | |||
Other current assets | 2,363 | |||
Property, plant and equipment | 230,319 | |||
Other assets | 9,268 | |||
Short-term borrowings and current portion of long-term debt | (36,770) | |||
Other current liabilities | (251,405) | |||
Long-term debt | (18,885) | |||
Pension obligations | (22,250) | |||
Other non-current liabilities | (21,218) | |||
Total identifiable net assets | 242,069 | |||
Goodwill | 23,409 | |||
Total | $ 265,478 |
Acquisitions Pro forma consolidated operating results, nonrecurring activities (Details) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2015
USD ($)
| |
Japanese Subsidiary | |
Business Acquisition, Pro Forma Information, Nonrecurring Activities [Line Items] | |
Reversal of deferred tax asset valuation allowance | $ 16.2 |
Gain on foreign currency translation adjustment | 12.6 |
J-Devices | |
Business Acquisition, Pro Forma Information, Nonrecurring Activities [Line Items] | |
Business combination, pro forma adjustment, net gain (loss) | $ (13.5) |
Acquisitions (Pro Forma Consolidated Results of Operations - J-Devices) (Details) - J-Devices - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Business Acquisition [Line Items] | ||
Net sales | $ 3,696,495 | $ 4,051,076 |
Net income | 88,190 | 153,049 |
Net income attributable to Amkor | $ 85,394 | $ 149,548 |
Basic earnings per share | $ 0.36 | $ 0.65 |
Diluted earnings per share | $ 0.36 | $ 0.63 |
Share-Based Compensation Plans (Weighted Average Fair Value) (Details) - $ / shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Expected life (in years) | 5 years 7 months 28 days | 6 years 5 months 13 days | 5 years 10 months 6 days |
Risk-free interest rate | 1.90% | 1.50% | 1.80% |
Volatility | 43.00% | 48.00% | 45.00% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Weighted-average grant date fair value per option granted | $ 4.24 | $ 2.89 | $ 3.14 |
Other Income and Expense (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Other Income and Expenses [Abstract] | |||
Interest income | $ (3,215) | $ (1,326) | $ (2,539) |
Foreign currency (gain) loss, net | 11,823 | (3,592) | (7,849) |
Loss on debt retirement | 4,835 | 0 | 9,560 |
Loss from acquisition of J-Devices (Note 3) | 0 | 0 | 13,501 |
Other (income) expense, net | (1,554) | (936) | (2,122) |
Total other (income) expense, net | $ 11,889 | $ (5,854) | $ 10,551 |
Income Taxes (Effects of Tax Reform) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | |||
Toll charge before credits | $ 162,750 | ||
Tax credits | (128,395) | ||
Remeasure deferred tax assets | 36,794 | ||
Reverse valuation allowance | (112,703) | ||
Total impact of U.S. tax reform | $ (41,554) | $ 0 | $ 0 |
Income Taxes (Components of income tax expense and income before taxes, by jurisdiction) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Geographic sources of income (loss) before income taxes | |||||||||||
United States | $ 14,935 | $ (12,385) | $ (39,684) | ||||||||
Foreign | 288,935 | 227,542 | 107,596 | ||||||||
Income before taxes and equity in earnings of unconsolidated affiliate | 303,870 | 215,157 | 67,912 | ||||||||
Current: | |||||||||||
Federal | 0 | 0 | 0 | ||||||||
State | 11 | 22 | 11 | ||||||||
Foreign | 81,969 | 49,577 | 28,721 | ||||||||
Current income tax expense (benefit) | 81,980 | 49,599 | 28,732 | ||||||||
Deferred: | |||||||||||
Federal | (36,943) | 0 | 0 | ||||||||
State | (4,611) | 0 | 0 | ||||||||
Foreign | (1,444) | (1,746) | (697) | ||||||||
Deferred income tax expense (benefit) | (42,998) | (1,746) | (697) | ||||||||
Income tax expense | $ (12,782) | $ 18,752 | $ 32,573 | $ 439 | $ 18,534 | $ 24,086 | $ 3,360 | $ 1,873 | $ 38,982 | $ 47,853 | $ 28,035 |
Income Taxes (Reconciliation of effective tax rate) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | |||||||||||
Federal statutory income tax rate (in dollars per share) | 35.00% | 35.00% | 35.00% | ||||||||
Reconciliation between statutory rate and income tax provision | |||||||||||
U.S. federal tax at 35% | $ 106,354 | $ 75,305 | $ 23,769 | ||||||||
State taxes, net of federal benefit | 2,193 | 836 | 2,622 | ||||||||
Foreign income taxed at different rates | (51,412) | (17,907) | (11,756) | ||||||||
Foreign exchange (loss) gain | 29,756 | (1,127) | (5,680) | ||||||||
Change in valuation allowance | (4,703) | (7,362) | 18,259 | ||||||||
Adjustments related to prior years | 3,329 | (2,648) | (912) | ||||||||
U.S. tax reform (the Tax Act) | (41,554) | 0 | 0 | ||||||||
Income tax credits generated | (7,296) | (40,301) | (1,919) | ||||||||
Repatriation of foreign earnings and profits | 719 | 25,604 | 91 | ||||||||
Expiration of net operating losses and credits | 166 | 15,092 | 74 | ||||||||
Non-deductible loss on acquisition of J-Devices (Note 3) | 0 | 0 | 4,725 | ||||||||
Other | 1,430 | 361 | (1,238) | ||||||||
Income tax expense | $ (12,782) | $ 18,752 | $ 32,573 | $ 439 | $ 18,534 | $ 24,086 | $ 3,360 | $ 1,873 | $ 38,982 | $ 47,853 | $ 28,035 |
Income Taxes (Components of deferred tax assets and liabilities) (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Components of Deferred Tax Assets and Liabilities [Abstract] | ||
Net operating loss carryforwards | $ 53,130 | $ 111,899 |
Income tax credits | 23,998 | 41,900 |
Property, plant and equipment | 35,479 | 21,860 |
Accrued liabilities | 68,091 | 68,563 |
Receivable | 32,719 | 0 |
Unrealized foreign exchange loss | 1,924 | 531 |
Other | 12,682 | 14,583 |
Total deferred tax assets | 228,023 | 259,336 |
Valuation allowance | (83,338) | (165,367) |
Total deferred tax assets net of valuation allowance | 144,685 | 93,969 |
Property, plant and equipment | 15,754 | 20,407 |
Deferred gain | 939 | 2,655 |
Unrealized foreign exchange gain | 8,383 | 990 |
Other | 4,566 | 4,836 |
Total deferred tax liabilities | 29,642 | 28,888 |
Other assets | 117,608 | 66,831 |
Other non-current liabilities | (2,565) | (1,750) |
Net deferred tax assets | $ 115,043 | $ 65,081 |
Income Taxes (Tax holidays) (Details) - USD ($) $ / shares in Units, $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | |||
Tax benefit from income tax holiday | $ 6.2 | $ 5.6 | $ 3.3 |
Benefit from income tax holiday on diluted earnings per share (in dollars per share) | $ 0.03 | $ 0.02 | $ 0.01 |
Income Taxes (Valuation allowance) (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Valuation Allowance [Line Items] | ||
Total valuation allowance | $ 83,338 | $ 165,367 |
United States | ||
Valuation Allowance [Line Items] | ||
Total valuation allowance | 43,719 | 164,479 |
Portugal | ||
Valuation Allowance [Line Items] | ||
Total valuation allowance | 39,009 | 0 |
Other | ||
Valuation Allowance [Line Items] | ||
Total valuation allowance | $ 610 | $ 888 |
Income Taxes (Net operating loss carryforwards) (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Loss Carryforwards and other details [Abstract] | ||
Undistributed earnings of foreign subsidiaries | $ 1,100,000 | |
U.S. Federal | ||
Loss Carryforwards and other details [Abstract] | ||
Operating loss carryforwards | 220,445 | $ 292,715 |
Tax credit carryforward | 12,600 | |
U.S. State | ||
Loss Carryforwards and other details [Abstract] | ||
Operating loss carryforwards | 121,095 | 138,218 |
Foreign | ||
Loss Carryforwards and other details [Abstract] | ||
Operating loss carryforwards | 2,967 | $ 3,378 |
Repatriation of earnings estimated tax impact | $ 80,500 |
Income Taxes (Unrecognized tax benefits - rollforward and discussion) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance, beginning of period | $ 23,149 | $ 23,332 | $ 12,670 |
Additions based on tax positions related to the current year | 1,419 | 1,822 | 12,727 |
Additions for tax positions of prior years | 2,661 | 689 | 3,341 |
Reductions for tax positions of prior years | (1) | (2,589) | (4,815) |
Reductions from lapse of statutes of limitations | (17) | (105) | (591) |
Balance, end of period | 27,211 | $ 23,149 | $ 23,332 |
Income tax contingency [Abstract] | |||
Unrecognized tax benefits, period increase (decrease) | 4,100 | ||
Liability for uncertain tax positions | 24,800 | ||
Accrued and unpaid interest and penalties | $ 4,200 |
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Dilutive Securities Adjustments [Line Items] | |||||||||||
Net income attributable to Amkor | $ 100,770 | $ 54,435 | $ 115,507 | $ (10,006) | $ 100,263 | $ 60,089 | $ 4,713 | $ (875) | $ 260,706 | $ 164,190 | $ 51,098 |
Income allocated to participating securities | 0 | 0 | (59) | ||||||||
Net income available to Amkor common stockholders | $ 260,706 | $ 164,190 | $ 51,039 | ||||||||
Weighted-average shares outstanding — basic | 238,937 | 237,416 | 236,850 | ||||||||
Effect of dilutive securities: | |||||||||||
Weighted-average shares outstanding — diluted | 239,651 | 238,034 | 237,170 | ||||||||
Net income attributable to Amkor per common share: | |||||||||||
Basic (in dollars per share) | $ 0.42 | $ 0.23 | $ 0.48 | $ (0.04) | $ 0.42 | $ 0.25 | $ 0.02 | $ 0.00 | $ 1.09 | $ 0.69 | $ 0.22 |
Diluted (in dollars per share) | $ 0.42 | $ 0.23 | $ 0.48 | $ (0.04) | $ 0.42 | $ 0.25 | $ 0.02 | $ 0.00 | $ 1.09 | $ 0.69 | $ 0.22 |
Stock Options and Restricted Share Awards [Member] | |||||||||||
Effect of dilutive securities: | |||||||||||
Stock options and restricted share awards | 714 | 618 | 320 |
Earnings Per Share (Antidilutive) (Details) - shares shares in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Stock Options And Restricted Shares [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Stock options and restricted share awards | 3,445 | 1,135 | 1,858 |
Factoring of Accounts Receivable Factoring of Accounts Receivable (Details) - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Total Factored | ||
Factoring of Accounts Receivable [Line Items] | ||
Accounts Receivable Sold without Recourse | $ 611.2 | $ 574.1 |
Factoring Fees | ||
Factoring of Accounts Receivable [Line Items] | ||
Accounts Receivable Sold without Recourse | $ 4.6 | $ 2.5 |
Inventories (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Inventories | ||
Raw materials and purchased components | $ 213,649 | $ 173,035 |
Work-in-process | 112,843 | 94,955 |
Total inventories | $ 326,492 | $ 267,990 |
Property, Plant and Equipment (Narrative) (Details) - USD ($) $ in Thousands |
1 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
May 31, 2017 |
Nov. 30, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment | $ 6,896,008 | $ 6,427,413 | |||
Proceeds from sale of property, plant and equipment | 141,530 | 45,635 | $ 6,945 | ||
Gain on sale K1 factory | 2,648 | (1,390) | $ (1,190) | ||
Korea | |||||
Property, Plant and Equipment [Line Items] | |||||
Proceeds from sale of property, plant and equipment | $ 142,400 | $ 142,400 | |||
Percentage of proceeds received | 10.00% | ||||
Gain on sale K1 factory | $ 108,100 | $ 108,100 | |||
Construction in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment | 104,910 | 87,037 | |||
Construction in progress | K5 Facility | Korea | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment | $ 46,900 | $ 44,800 |
Goodwill (Details) - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 30, 2015 |
|
Goodwill [Roll Forward] | |||
Beginning Balance | $ 24,122,000 | $ 23,409,000 | |
Goodwill acquired | 713,000 | ||
Translation adjustment | 914,000 | ||
Ending Balance | 25,036,000 | 24,122,000 | |
Goodwill impairment | $ 0 | $ 0 | |
J-Devices | |||
Goodwill [Roll Forward] | |||
Ownership interest in J-Devices (percent) | 100.00% |
Accrued Expenses (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Payables and Accruals [Abstract] | ||
Payroll and benefits | $ 134,785 | $ 117,636 |
Deferred revenue and customer advances | 63,196 | 65,653 |
Income taxes payable | 56,664 | 37,961 |
Accrued settlement costs | 37,783 | 35,304 |
Accrued severance plan obligations (Note 14) | 15,190 | 14,053 |
Accrued interest | 11,873 | 13,046 |
Other accrued expenses | 55,107 | 55,016 |
Total accrued expenses | $ 374,598 | $ 338,669 |
Debt (Maturities) (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Debt Disclosure [Abstract] | ||
2018 | $ 123,848 | |
2019 | 173,649 | |
2020 | 326,649 | |
2021 | 210,649 | |
2022 | 530,738 | |
Total debt | $ 1,365,533 | $ 1,477,661 |
Pension and Severance Plans (Korean Severance Plan) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Deferred Compensation Liability, Current and Noncurrent [Roll Forward] | |||
Total accrued severance plan obligations at December 31 | $ 153,735 | $ 136,214 | $ 142,959 |
Less current portion of accrued severance plan obligations (Note 12) | 15,190 | 14,053 | 14,306 |
Non-current portion of accrued severance plan obligations | 138,545 | 122,161 | 128,653 |
Korean Severance Plan | |||
Deferred Compensation Liability, Current and Noncurrent [Roll Forward] | |||
Balance at January 1 | 136,396 | 143,151 | 146,880 |
Provision of severance benefits | 11,714 | 6,746 | 21,088 |
Severance payments | (11,787) | (9,429) | (15,021) |
Foreign currency (gain) loss | 17,597 | (4,072) | (9,796) |
Balance at the end of year | 153,920 | 136,396 | 143,151 |
Payments remaining with the National Pension Fund | $ (185) | $ (182) | $ (192) |
Pension and Severance Plans (Defined Benefit Plans - Balance Sheet) (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Defined Benefit Plan [Abstract] | ||
Prepaid benefit cost (included in non-current assets) | $ 656 | $ 0 |
Accrued benefit liability (included in pension and severance obligations) | (43,397) | (39,945) |
Net amount recognized at year end | $ (42,741) | $ (39,945) |
Pension and Severance Plans (Changes and Components) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Defined Benefit Plan [Abstract] | |||
Service cost | $ 33,823 | $ 33,854 | $ 12,481 |
Interest cost | 4,067 | 3,641 | 2,954 |
Expected return on plan assets | (4,537) | (3,788) | (3,330) |
Amortization of prior service cost | 30 | 35 | 34 |
Recognized actuarial (gain) loss | 84 | 94 | 91 |
Net periodic pension cost | 33,467 | 33,836 | 12,230 |
Curtailment loss | 574 | 0 | 0 |
Settlement (gain) loss | 383 | 128 | 27 |
Total pension expense | $ 34,424 | $ 33,964 | $ 12,257 |
Pension and Severance Plans (Defined Benefit Plans - Expected future contributions and other disclosures) (Details) $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
Defined Benefit Plan [Abstract] | |
Expected contributions in next fiscal year | $ 23,000 |
Defined Benefit Plan, Estimated Future Benefit Payments [Abstract] | |
2018 | 6,288 |
2019 | 7,516 |
2020 | 9,538 |
2021 | 11,602 |
2022 | 14,143 |
2023 to 2027 | $ 107,557 |
Pension and Severance Plans (Defined Contribution Plans) (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Defined Benefit Plan [Abstract] | |||
Cost recognized | $ 10.4 | $ 8.8 | $ 8.6 |
Fair Value Measurements (Details) - Recurring - Level 1 - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Fair value assets measured on recurring basis | ||
Cash equivalent money market funds (Level 1) | $ 121,627 | $ 39,548 |
Restricted cash money market funds (Level 1) | $ 2,000 | $ 2,000 |
Commitments and Contingencies (Details) $ in Millions |
1 Months Ended | 3 Months Ended | 12 Months Ended |
---|---|---|---|
Jan. 31, 2015
USD ($)
payment
|
Dec. 31, 2014
USD ($)
|
Dec. 31, 2017
USD ($)
|
|
Loss Contingencies [Line Items] | |||
Non-lease long-term supply contract, remaining amount | $ 18.3 | ||
Patent License Litigation | |||
Loss Contingencies [Line Items] | |||
Amount awarded to other party | $ 155.0 | 38.8 | |
Number of quarterly settlement payments | payment | 16 | ||
Litigation settlement, expense | $ 87.1 | ||
Litigation settlement interest | $ 1.0 | ||
Cost of Sales | Patent License Litigation | |||
Loss Contingencies [Line Items] | |||
Litigation settlement, expense | 75.3 | ||
Interest Expense | Patent License Litigation | |||
Loss Contingencies [Line Items] | |||
Litigation settlement, expense | $ 11.8 |
Commitments and Contingencies (Future minimum lease payments) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Commitments and Contingencies Disclosure [Abstract] | |||
2018 | $ 26,439 | ||
2019 | 21,740 | ||
2020 | 13,694 | ||
2021 | 10,530 | ||
2022 | 8,468 | ||
Thereafter | 28,955 | ||
Total | 109,826 | ||
Rent expense | $ 48,100 | $ 43,800 | $ 24,500 |
Quarterly Results (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands |
1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
May 31, 2017 |
Nov. 30, 2016 |
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||
Net sales | $ 1,148,423 | $ 1,135,027 | $ 989,447 | $ 913,600 | $ 1,021,613 | $ 1,086,014 | $ 917,326 | $ 868,682 | $ 4,186,497 | $ 3,893,635 | $ 2,884,603 | ||
Gross profit | 225,494 | 216,638 | 172,235 | 142,906 | 227,187 | 213,800 | 131,606 | 122,884 | 757,273 | 695,477 | 479,265 | ||
Operating income | 110,128 | 98,237 | 168,293 | 24,655 | 126,689 | 114,615 | 30,542 | 22,094 | 401,313 | 293,940 | 164,839 | ||
Income tax (benefit) expense | (12,782) | 18,752 | 32,573 | 439 | 18,534 | 24,086 | 3,360 | 1,873 | 38,982 | 47,853 | 28,035 | ||
Net income (loss) | 101,943 | 55,630 | 116,459 | (9,144) | 101,202 | 61,141 | 5,366 | (405) | 264,888 | 167,304 | 53,893 | ||
Net income (loss) attributable to Amkor | $ 100,770 | $ 54,435 | $ 115,507 | $ (10,006) | $ 100,263 | $ 60,089 | $ 4,713 | $ (875) | $ 260,706 | $ 164,190 | $ 51,098 | ||
Basic (in dollars per share) | $ 0.42 | $ 0.23 | $ 0.48 | $ (0.04) | $ 0.42 | $ 0.25 | $ 0.02 | $ 0.00 | $ 1.09 | $ 0.69 | $ 0.22 | ||
Diluted (in dollars per share) | $ 0.42 | $ 0.23 | $ 0.48 | $ (0.04) | $ 0.42 | $ 0.25 | $ 0.02 | $ 0.00 | $ 1.09 | $ 0.69 | $ 0.22 | ||
Condensed Income Statements, Captions [Line Items] | |||||||||||||
Proceeds from sale of property, plant and equipment | $ 141,530 | $ 45,635 | $ 6,945 | ||||||||||
Gain on sale K1 factory | 2,648 | (1,390) | (1,190) | ||||||||||
Net tax benefit from U.S. tax reform | $ 41,554 | $ 0 | $ 0 | ||||||||||
Korea | |||||||||||||
Condensed Income Statements, Captions [Line Items] | |||||||||||||
Proceeds from sale of property, plant and equipment | $ 142,400 | $ 142,400 | |||||||||||
Gain on sale K1 factory | $ 108,100 | $ 108,100 |
Schedule II - Valuation and Qualifying Accounts (Details) - Valuation Allowance of Deferred Tax Assets - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Balance at Beginning of Period | $ 83,338 | $ 165,367 | $ 168,105 | $ 149,847 |
Additions (Credited) Charged to Expense | (116,917) | 7,729 | 18,507 | |
Write-offs | (489) | (15,091) | (248) | |
Other | 35,377 | 4,624 | (1) | |
Balance at End of Period | $ 83,338 | $ 165,367 | $ 168,105 |
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