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Amkor Technology's (AMKR) CEO Steve Kelley on Q1 2016 Results - Earnings Call Transcript

Q1 2016 Earnings Conference Call

April 27, 2016 05:00 PM ET

Executives

Steve Kelley - President and CEO

Joanne Solomon - CFO

Greg Johnson - Senior Director of Finance and IR

Analysts

Randy Abrams - Credit Suisse

Suji De Silva - Topeka

Sidney Ho - Deutsche Bank

Atif Malik - Citigroup

Ana Goshko - Bank of America Merrill Lynch

Umesh Bhandary - Jefferies

David Duley - Steelhead Security

Sean Dixon - Bradford & Marzec

Operator

Good day ladies and gentlemen and welcome to the Amkor Technology First Quart 2016 Earnings Conference Call. My name is Michelle and I will be your conference facilitator today. At this time all participants are in a listen only mode. After the speakers remarks we will conduct a question and answer session. As a reminder this conference is being recorded.

I would now like to turn the call over to Greg Johnson Senior Director of Finance and Investor Relation. Mr. Johnson please go ahead.

Greg Johnson

Thank you, Michelle, and good afternoon, everyone. Joining me today are Steve Kelley, our President and Chief Executive Officer and Joanne Solomon, our Chief Financial Officer.

Our earnings press release was filed with the SEC this afternoon and is available on our website. During this conference call, we will use non-GAAP financial measures and you can find the reconciliation to the U.S. GAAP equivalent at our website. These non-GAAP measures include combining J-Devices financial results for certain periods prior to their consolidations.

We will also make forward-looking statements about our expectations for Amkor's future performance based on the environment as we currently see it. And statements about the impact of the earth quakes in Japan at our ongoing recovery efforts.

Of course, actual results could be different. Please refer to our press release and other SEC filings for information on risk factors, uncertainties and exceptions that could cause actual results to differ materially from these expectations. Please note that the financial results discussed today are preliminary and final data will be included in our Form 10-Q.

And now, I would like to turn the call over to Steve.

Steve Kelley

Good afternoon, and thanks for joining the call. Today, I'll discuss our first quarter results, our second quarter outlook, and the status of our key growth initiatives.

First quarter revenue of nearly $870 million was well about the high end of our guidance. We benefited from better than expected demand in Japan and strengthen high end android smart phone market.

On the combined basis with J-Devices revenues were flat sequentially. Year-on-year combined revenues were down 9% due to a weaker demand environment particularly in the communication space. This lower revenue were the break even financial results.

Looking ahead we see improved demand across most end markets. Unfortunately we do not expect to realize meaningful revenue growth in Q2 due to temporary disruption stepping from the recent earth quakes in Japan.

Our Kumamoto factory was damaged in the earthquakes and is currently operating on a limited basis. Repair work is being expedited and we expect to ramp to full operational capacity over the next 11 weeks. We are working closely with our customer base to minimize disruption during the recovery period.

I have been impressed with the speed and professionalism of our team in Japan. The constructive approach taken by our customers and the support provided by the world wide Amkor Manufacturing team.

The entire supply chain is working together to ensure a speedy recovery.

We were relieved that only few of our employees suffered minor injuries during the earth quakes. Others are on Kyushu island were unfortunate and we extend our condolences to those who were seriously impacted by this natural disaster.