EX-99.29 9 a74913ex99-29.txt EXHIBIT 99.29 1 EXHIBIT 99.29 Diodes Incorporated FOR IMMEDIATE RELEASE Diodes, Inc. Reports Second Quarter 2001 Results Westlake Village, California, July 31, 2001 -- Diodes Incorporated (Nasdaq: DIOD), a leading manufacturer and supplier of high quality discrete semiconductors, primarily to the communications, computing, industrial, consumer electronics and automotive industries, today reported financial results for the second quarter ended June 30, 2001. Revenues for the second quarter were $21.0 million, a decrease of 36% as compared to $32.6 million for the comparable quarter in 2000. Net income for the same period decreased 88% to $525,000, as compared to $4.3 million for the three months ended June 30, 2000. Diluted earnings per share were $0.06 for the second quarter of 2001, a decrease of 87% as compared to $0.46 per diluted share for the same period last year. For the first six months of 2001, the Company earned $1.0 million, or $0.12 per diluted share, on revenues of $46.7 million, compared to net income of $7.5 million, or $0.81 per diluted share, on revenues of $60.0 million for the same period in 2000. Commenting on the Company's financial results, C. H. Chen, President and Chief Executive Officer of Diodes, said, "In the second quarter, Diodes has continued to be challenged by one of the deepest, most rapid downturns in the history of the semiconductor industry. This turbulent market environment adversely impacted our sales, margins and product mix. I am pleased to report that management has taken swift and decisive action to adjust our cost structure and manage our working capital, such that the Company was able to report our forty-fifth consecutive quarter of profitability. "Diodes has maintained our strategic focus on those issues we believe will drive our success over the next industry cycle. This includes maintaining our world-class customer service orientation, expanding our sales organization to reach markets such as Europe and mainland China, forming mutually beneficial alliances with industry leaders and developing new devices that apply innovative technology to solve our customers' needs." Second Quarter Highlights: Forty-fifth consecutive quarter of profitability with Q2 EPS of $0.06 Appointment of European sales manager Restructured balance sheet increases financial flexibility The Company's gross profit margin was 19.3% in the second quarter, as compared to 16.0% in the prior quarter and 32.2% in the second quarter of 2000. This decrease as compared to the prior year reflects reduced capacity utilization of the Company's manufacturing assets at both FabTech and Diodes-China and significant pricing pressure in all markets. "Since becoming aware of the magnitude of this correction at the end of last year, Diodes has continued to look at every area of our organization for opportunities to adjust costs and increase efficiencies. We also made progress in reducing fixed costs and improving manufacturing yields at our wafer foundry. As a result, despite a sequential drop in market demand, we were able to improve our gross margin by over 3 percentage points," said Chen. SG&A expenses were reduced by $1.8 million to 16.4% of net sales in the quarter compared to 16.2% in the second quarter of 2000, reflecting significant cost-saving initiatives to bring overhead expenses in-line with a reduced revenue base. 36 2 "During the second quarter, demand in North America remained weak, as distributors and OEM's continued to reduce inventory levels following several quarters of aggressive ordering to support what proved to be overly optimistic growth forecasts. By contrast, unit demand in the Asian market increased in Q2, but was accompanied by severe pricing pressures and a product shift towards lower-margin devices. We believe that there are some structural forces that are likely to create a more normalized demand picture by the end of the year, but given the significant uncertainty as to the timing of this event, we continue to manage for these contingencies." "Even during this challenging period, Diodes has continued to maintain or increase market share, while laying the groundwork to penetrate new markets in geographic regions that we believe will be key to our future growth. We are pleased with our rapid progress in building a sales organization capable of winning customers in Europe. In addition, Diodes is forming a Hong Kong sales subsidiary that will facilitate entry into the China market. Most importantly, we have continued to build our research and development capability and new product pipeline, so as to develop devices that will deliver unique value to our customers and support sustainable, high margin programs. This is part of our strategy to position Diodes as a technology leader in discrete markets," said Chen. Chen noted that Diodes generated cash flow from operations of $4.2 million in the first half of this year, in part attributable to a 25% decrease of inventories to $23.9 million from $31.8 million at the beginning of this year. In addition, the Company recently renegotiated payment terms on $10 million of the note assumed as part of the FabTech wafer foundry purchase from Lite-On Semiconductor Corp. (LSC), from 12 months to 36 months, reducing the current portion of this debt by $7.5 million. "With the existing credit facility, we believe the Company has sufficient liquidity to meet our foreseeable requirements," Chen concluded. Join us for our conference call to be broadcast live at 9:00 am PDT (12 noon EDT) today, available via webcast at the investor section of Diodes' website at: www.diodes.com. About Diodes Incorporated Diodes, Inc. (Nasdaq: DIOD) is a leading manufacturer and supplier of high-quality discrete semiconductor products, serving the communications, computer, industrial, consumer electronics and automotive markets. The Company operates two Far East subsidiaries, Diodes-China (QS-9000 & ISO-14001 certified) in Shanghai and Diodes-Taiwan (ISO-9000 certified) in Taipei. Diodes-China's manufacturing focus is on surface-mount devices destined for wireless devices, notebook computers, pagers, PCMCIA cards and modems, among others. Diodes-Taiwan is our Asia-Pacific sales, logistics and distribution center. The Company's newly acquired 5" wafer foundry, Diodes-FabTech (QS-9000 certified), specializes in Schottky products and is located just outside Kansas City, Missouri. The Company's ISO-9000 corporate sales, marketing, engineering and logistics headquarters is located in Southern California. For further information, visit the Company's website at http://www.diodes.com. Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: Any statements set forth above that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Potential risks and uncertainties include, but are not limited to, such factors as fluctuations in product demand, the introduction of new products, the Company's ability to maintain customer and vendor relationships, technological advancements, impact of competitive products and pricing, growth in targeted markets, risks of foreign operations, and other information detailed from time to time in the Company's filings with the United States Securities and Exchange Commission. Source: Diodes Incorporated CONTACT: Crocker Coulson, Partner, Coffin Communications Group; (818) 789-0100 e-mail: crocker.coulson@coffincg.com or Carl Wertz, Chief Financial Officer, Diodes, Inc.; (805) 446-4800 Recent news releases, annual reports, and SEC filings are available at the Company's website: http://www.diodes.com. Written requests may be sent directly to the Company, or they may be e-mailed to: diodes-fin@diodes.com. CONSOLIDATED CONDENSED INCOME STATEMENT and BALANCE SHEET FOLLOWS 37 3 DIODES INCORPORATED AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, ------------------------------- ------------------------------- 2000 2001 2000 2001 ------------ ------------ ------------ ------------ NET SALES $ 32,600,000 $ 21,001,000 $ 60,037,000 $ 46,749,000 Cost of Goods Sold 22,111,000 16,957,000 41,111,000 38,584,000 ------------ ------------ ------------ ------------ Gross profit 10,489,000 4,044,000 18,926,000 8,165,000 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 5,270,000 3,453,000 9,812,000 6,637,000 ------------ ------------ ------------ ------------ Income from operations 5,219,000 591,000 9,114,000 1,528,000 OTHER INCOME (EXPENSE) Interest income 143,000 69,000 195,000 136,000 Interest expense (372,000) (570,000) (588,000) (1,310,000) Other 40,000 220,000 46,000 123,000 ------------ ------------ ------------ ------------ (189,000) (281,000) (347,000) (1,051,000) Income before income taxes and minority interest 5,030,000 310,000 8,767,000 477,000 INCOME TAX BENEFIT (PROVISION) (535,000) 260,000 (1,027,000) 689,000 ------------ ------------ ------------ ------------ Income before minority interest 4,495,000 570,000 7,740,000 1,166,000 MINORITY INTEREST IN JOINT VENTURE EARNINGS (175,000) (45,000) (280,000) (119,000) ------------ ------------ ------------ ------------ NET INCOME $ 4,320,000 $ 525,000 $ 7,460,000 $ 1,047,000 ============ ============ ============ ============ EARNINGS PER SHARE Basic $ 0.54 $ 0.06 $ 0.93 $ 0.13 Diluted $ 0.46 $ 0.06 $ 0.81 $ 0.12 ============ ============ ============ ============ WEIGHTED AVERAGE SHARES OUTSTANDING Basic 8,072,885 8,143,318 8,029,413 8,139,501 Diluted 9,340,505 8,896,326 9,250,361 8,970,250 ============ ============ ============ ============
38 4 DIODES INCORPORATED AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEET ASSETS
DECEMBER 31, JUNE 30, 2000 2001 ------------ ------------ (UNAUDITED) CURRENT ASSETS Cash $ 4,476,000 $ 2,867,000 Accounts receivable Customers 19,723,000 19,267,000 Related parties 615,000 1,467,000 Other 26,000 -- ------------ ------------ 20,364,000 20,734,000 Less allowance for doubtful receivables 311,000 250,000 ------------ ------------ 20,053,000 20,484,000 Inventories 31,788,000 23,939,000 Deferred income taxes, current 4,387,000 4,382,000 Prepaid expenses and other current assets 686,000 912,000 ------------ ------------ Total current assets 61,390,000 52,584,000 PROPERTY, PLANT AND EQUIPMENT, at cost, net of accumulated depreciation and amortization 45,129,000 47,569,000 DEFERRED INCOME TAXES, non-current 616,000 2,173,000 OTHER ASSETS Goodwill, net 5,318,000 5,463,000 Other 497,000 459,000 ------------ ------------ TOTAL ASSETS $112,950,000 $108,248,000 ============ ============
39 5 DIODES INCORPORATED AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEET LIABILITIES AND STOCKHOLDERS' EQUITY
DECEMBER 31, JUNE 30, 2000 2001 ------------ ------------ (UNAUDITED) CURRENT LIABILITIES Line of credit $ 7,750,000 $ 8,055,000 Accounts payable Trade 10,710,000 6,234,000 Related parties 1,008,000 2,713,000 Accrued liabilities 8,401,000 5,472,000 Income taxes payable 1,370,000 329,000 Current portion of long-term debt Related party 11,049,000 3,240,000 Other 3,811,000 3,550,000 ------------ ------------ Total current liabilities 44,099,000 29,593,000 LONG-TERM DEBT, net of current portion Related party 2,500,000 10,000,000 Other 13,497,000 14,314,000 ------------ ------------ MINORITY INTEREST IN JOINT VENTURE 1,601,000 1,720,000 STOCKHOLDERS' EQUITY Class A convertible preferred stock - par value $1.00 per share; 1,000,000 shares authorized; no shares issued and outstanding -- -- Common stock - par value $0.66 2/3 per share; 30,000,000 shares authorized; 9,201,704 and 9,222,205 shares issued and outstanding at December 31, 2000 and June 30, 2001, respectively 6,134,000 6,148,000 Additional paid-in capital 7,143,000 7,224,000 Retained earnings 39,758,000 41,031,000 ------------ ------------ 53,035,000 54,403,000 Less: Treasury stock -- 1,075,672 shares of common stock, at cost 1,782,000 1,782,000 ------------ ------------ Total stockholders' equity 51,253,000 52,621,000 ------------ ------------ TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $112,950,000 $108,248,000 ============ ============
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