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Amkor Technology Releases Financial Results for the Fourth Quarter and Full Year 2013

February 13, 2014

Amkor Technology, a provider of semiconductor packaging and test services, announced financial results for the fourth quarter ended December 31, 2013, with net sales of $755 million, net income of $41 million and earnings per diluted share of $0.18.

In a release on February 10, the Company noted that for the full year 2013, Amkor reported net sales of $2.96 billion, net income of $109 million and earnings per diluted share of $0.50.

"2013 was a very good year for Amkor," said Steve Kelley, Amkor's president and chief executive officer. "Revenues grew by 7 percent to nearly $3 billion, a new record for the company. Gross margin improved by 160 basis points, and earnings per share increased 20 percent."

Selected financial information for the fourth quarter 2013 is as follows:

-Net sales: $755 million, down 2 percent from $768 million in the prior quarter, and up 4 percent from $723 million in the fourth quarter of 2012

-Gross margin of 19.9 percent, compared to adjusted gross margin of 19.7 percent in the prior quarter, and adjusted gross margin of 18.4 percent in the fourth quarter of 2012

-Net income of $41 million, compared to adjusted net income of $35 million in the prior quarter, and adjusted net income of $27 million in the fourth quarter of 2012

-Earnings per diluted share of $0.18, compared to adjusted earnings per diluted share of $0.15 in the prior quarter, and adjusted earnings per diluted share of $0.13 in the fourth quarter of 2012

Selected financial information for the full year 2013 is as follows:

-Net sales: $2.96 billion, up 7 percent from $2.76 billion in 2012

-Adjusted gross margin: 18.8 percent, compared to 17.2 percent in 2012

-Adjusted net income: $119 million, compared to $94 million in 2012

-Adjusted earnings per diluted share: $0.54, compared to $0.45 in 2012

The adjusted gross margin, adjusted net income and adjusted earnings per diluted share information presented above excludes loss contingency charges relating to our pending patent license litigation and are non-GAAP measures. The loss contingency charges are $56 million ($52 million, net of tax) in 2012 and $11 million ($10 million, net of tax) in 2013. Selected operating data for all periods discussed above, and a reconciliation to the comparable GAAP measures, are included in a section below before the financial statements.

"We delivered solid fourth quarter results with sales at the mid- point of our guidance, and gross margin and earnings per share at the high end," said Joanne Solomon, Amkor's executive vice president and chief financial officer. "Sales were down 2 percent sequentially as we saw the expected seasonal declines in the consumer and computing markets. Gross margin of 19.9 percent was consistent with the third quarter."

Cash and cash equivalents were $610 million, and total debt was $1.7 billion, at December 31, 2013.

Business Outlook

"Historically, the first quarter is our weakest quarter of the year, and 2014 fits that pattern," said Kelley. "We expect that first quarter revenues will be down 11 percent sequentially, mostly due to seasonality, but also because of continuing weakness in the high-end of the mobile device market. For the full year, we see sequential growth in the second quarter, followed by a strong second half tied to the launch of flagship mobile devices."

Based upon currently available information, we have the following expectations for the first quarter 2014:

-Net sales of $650 million to $700 million, down 7 percent to 14 percent from the prior quarter

-Gross margin of 14 percent to 17 percent

-Net income of ($5 million) to $17 million, or ($0.02) per basic share to $0.08 per diluted share

-Full year 2014 capital expenditures of around $450 million

Amkor is a provider of semiconductor packaging and test services.

More Information:

www.amkor.com

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