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Diodes Incorporated Reports Third Quarter 2017 Financial Results

 Achieves Another Quarter of Record Revenue and Gross Profit; Sets a New Record for Operating Income

Diodes Incorporated (Nasdaq: DIOD), a leading global manufacturer and supplier of high-quality application specific standard products within the broad discrete, logic, analog and mixed-signal semiconductor markets, today reported its financial results for the third quarter ended September 30, 2017.

Third Quarter Highlights

  • Revenue was a record $285.2 million, an increase of 8.0 percent from the $264.2 million in the second quarter 2017 and an increase of 13.8 percent from the $250.7 million in the third quarter 2016;
  • GAAP gross profit was a record $96.3 million, including $2.7 million of KFAB closure costs, and non-GAAP gross profit was $99.0 million. This compares to $90.1 million in the second quarter 2017 and $80.6 million in the third quarter 2016; 
  • GAAP gross profit margin was 33.8 percent, and non-GAAP gross profit margin was 34.7 percent. This compares GAAP gross profit margin of 34.1 percent in the second quarter 2017 and 32.2 percent in the third quarter 2016;
  • GAAP income from operations was $23.7 million, or 8.3 percent of revenue. Non-GAAP adjusted income from operations (which excludes intangible asset amortization costs and KFAB shutdown costs) was a record $35.2 million, or 12.3 percent of revenue, compared to $29.9 million, or 11.3 percent, last quarter and $25.5 million, or 10.2 percent, in the year ago quarter;
  • GAAP net income was $14.5 million, or $0.29 per diluted share, compared to $13.2 million, or $0.26 per diluted share, in the second quarter 2017 and $10.6 million, or $0.21 per diluted share, in the third quarter 2016;
  • Non-GAAP adjusted net income was $22.6 million, or $0.45 per diluted share, compared to $17.8 million, or $0.36 per diluted share, in the second quarter 2017 and $15.1 million, or $0.30 per diluted share, in the third quarter 2016;
  • Excluding $3.2 million, net of tax, of non-cash share-based compensation expense, both GAAP and non-GAAP diluted earnings per share would have increased by $0.06 per diluted share; and
  • Achieved $40.9 million of cash flow from operations, and $2.9 million free cash flow, including $38.0 million of capital expenditures. Net cash flow was a negative ($65.4) million, which includes the pay down of $75.2 million of long-term debt.

Commenting on the results, Dr. Keh-Shew Lu, President and Chief Executive Officer, stated, “Diodes achieved another quarter of record results, setting new highs on revenue, gross profit and operating income. Our growth continued to be broad-based across all regions and end markets. We also achieved record revenue in our computing and communications end markets, complemented by 30 percent year-over-year growth in both automotive and industrial. In fact, our automotive end market reached a record 8 percent of revenue, which is even more notable considering the higher revenue base. Revenue from Pericom also continued to grow from the high level achieved last quarter, with solid margin contribution as we integrate these products into our complete customer offerings.

“Additionally, continued improvements in product mix and utilization across our facilities resulted in non-GAAP gross margin close to our target model of 35 percent in the quarter. We have completed wafer manufacturing at our KFAB facility and remain on track to return the property to the landlord by November 15th. Consistent with our focus on driving increased profitability and expanding shareholder value, we recently established new long-term financial targets, which includes gross margin of 40 percent and operating margin of 20 percent. As a result of the strategic actions we have taken over the past few years, we have positioned the business to drive significant earnings expansion, serving as the basis for introducing these increased targets.

“Our business is also generating a significant amount of cash. We plan to continue allocating cash toward reducing our long-term debt, while also maintaining the flexibility to support our future expansion initiatives, potential strategic acquisitions as well as our existing share buyback program. Looking forward, we are well positioned to benefit from our solid operating leverage to deliver increased profitability and shareholder value.”

Third Quarter 2017

Revenue for third quarter 2017 was $285.2 million, an increase of 8.0 percent from the $264.2 million in the second quarter 2017 and an increase of 13.8 percent from $250.7 million in third quarter 2016. Revenue in the quarter increased sequentially reflecting continued strength across all of the Company’s target end markets and geographies.

GAAP gross profit for third quarter 2017 was $96.3 million, or 33.8 percent of revenue, including approximately $2.7 million of KFAB closure costs. Non-GAAP gross profit was $99.0 million, or 34.7 percent of revenue, excluding these costs. This compares to GAAP gross profit of $90.1 million, or 34.1 percent of revenue, in the second quarter 2017 and $80.6 million, or 32.2 percent of revenue, in the third quarter 2016.  The increase in gross profit margin was due primarily to continued improvements in product mix and utilization, combined with another strong quarter in North America and Europe as well as the Pericom business.

GAAP operating expenses for third quarter 2017 were $72.6 million, or 25.5 percent of revenue, and $63.9 million, or 22.4 percent of revenue, on a non-GAAP basis, which excludes $4.7 million of amortization of acquisition-related intangible asset expenses, $2.0 million of KFAB restructuring charges and $2.0 million for the impairment of fixed assets. GAAP operating expenses in the second quarter 2017 were $66.3 million, or 25.1 percent of revenue, and $59.8 million, or 22.6 percent of revenue, on a non-GAAP basis.  

Third quarter 2017 GAAP net income was $14.5 million, or $0.29 per diluted share, compared to $13.2 million, or $0.26 per diluted share, in second quarter 2017 and $10.6 million, or $0.21 per share, in third quarter 2016.

Third quarter 2017 non-GAAP adjusted net income was $22.6 million, or $0.45 per diluted share, which excluded, net of tax, $3.8 million of non-cash acquisition-related intangible asset amortization costs, $3.1 million of KFAB restructuring and closure costs and $1.3 million of fixed asset impairment charges. This compares to non-GAAP adjusted net income of $17.8 million, or $0.36 per diluted share, in second quarter 2017 and $15.1 million, or $0.30 per diluted share, in third quarter 2016. 

The following is an unaudited summary reconciliation of GAAP net income to non-GAAP adjusted net income and per share data, net of tax (in thousands, except per share data):

    Three Months Ended
    September 30, 2017
GAAP net income     $14,450
GAAP diluted earnings per share     $0.29
Adjustments to reconcile net income to non-GAAP net income:    
M&A Activities    
     Pericom     2,530
Amortization of acquisition-related intangible assets 2,530  
     KFAB    
Restructuring 1,325  
Shut-down related costs 1,769  
Impairment of fixed assets 1,295  
     Others     1,265
Amortization of acquisition-related intangible assets 1,265  
Non-GAAP net income     $22,634
Non-GAAP diluted earnings per share     $0.45

(See the reconciliation tables of GAAP net income to non-GAAP adjusted net income near the end of this release for further details).

Included in third quarter 2017 GAAP net income and non-GAAP adjusted net income was approximately $3.2 million, net of tax, of non-cash share-based compensation expense. Excluding share-based compensation expense, both GAAP earnings per share (“EPS”) and non-GAAP adjusted EPS would have increased by $0.06 per share for third quarter 2017, $0.07 for second quarter 2017 and $0.06 for third quarter 2016.

EBITDA (a non-GAAP measure), which represents earnings before net interest expense, income tax, depreciation and amortization, for third quarter 2017, was $46.8 million, compared to $45.8 million for second quarter 2017 and $42.5 million for third quarter 2016. For a reconciliation of GAAP net income to EBITDA, see the table near the end of this release for further details.

For third quarter 2017, net cash provided by operating activities was $40.9 million. Net cash flow was a negative ($65.4) million, including the $75.2 million long-term debt pay down. Free cash flow (a non-GAAP measure) was $2.9 million, which includes $38.0 million of capital expenditures.

Balance Sheet

As of September 30, 2017, the Company had approximately $214 million in cash, cash equivalents and short-term investments, long-term debt (including the current portion) totaled approximately $326 million, and working capital was approximately $476 million.

The results announced today are preliminary, as they are subject to the Company finalizing its closing procedures and customary quarterly review by the Company's independent registered public accounting firm. As such, these results are subject to revision until the Company files its Form 10-Q for the quarter ending September 30, 2017.

Business Outlook

Dr. Lu concluded, “We expect typical seasonality for the fourth quarter of 2017 with revenue to range between $260 million and $280 million, or down 8.9 to 1.8 percent sequentially or up 12.0 to 20.6 percent year-over-year. We expect GAAP gross margin to be 34.9 percent, plus or minus 1 percent, and non-GAAP gross margin to be 35.0 percent, plus or minus 1 percent. Non-GAAP operating expenses, which are GAAP operating expenses adjusted for KFAB closure costs and retention costs and amortization of acquisition-related intangible assets, are expected to be approximately 23.5 percent of revenue, plus or minus 1 percent. We expect interest expense to be approximately $3.0 million. Our income tax rate is expected to be 29.0 percent, plus or minus 3 percent, and shares used to calculate diluted EPS for the fourth quarter are anticipated to be approximately 50.8 million.” Please note that purchase accounting adjustments of $3.9 million, after tax, for Pericom and previous acquisitions plus KFAB closure costs of $3.8 million are not included in these non-GAAP estimates.

Conference Call

Diodes will host a conference call on Tuesday, November 7, 2017 at 4:00 p.m. Central Time (5:00 p.m. Eastern Time) to discuss its third quarter 2017 financial results. Investors and analysts may join the conference call by dialing 1-855-232-8957 and providing the confirmation code 1689671. International callers may join the teleconference by dialing 1-315-625-6979 and entering the same confirmation code at the prompt. A telephone replay of the call will be made available approximately two hours after the call and will remain available until November 14, 2017 at midnight Central Time. The replay number is 1-855-859-2056 with a pass code of 1689671. International callers should dial 1-404-537-3406 and enter the same pass code at the prompt. Additionally, this conference call will be broadcast live over the Internet and can be accessed by all interested parties on the Investors’ section of Diodes' website at www.diodes.com. To listen to the live call, please go to the Investors’ section of Diodes’ website and click on the conference call link at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those unable to participate during the live broadcast, a replay will be available shortly after the call on Diodes' website for approximately 60 days.

About Diodes Incorporated

Diodes Incorporated (Nasdaq: DIOD), a Standard and Poor’s SmallCap 600 and Russell 3000 Index company, is a leading global manufacturer and supplier of high-quality application specific standard products within the broad discrete, logic, analog and mixed-signal semiconductor markets. Diodes serves the consumer electronics, computing, communications, industrial, and automotive markets. Diodes’ products include diodes, rectifiers, transistors, MOSFETs, protection devices, function-specific arrays, single gate logic, amplifiers and comparators, Hall-effect and temperature sensors, power management devices, including LED drivers, AC-DC converters and controllers, DC-DC switching and linear voltage regulators, and voltage references along with special function devices, such as USB power switches, load switches, voltage supervisors, and motor controllers. Diodes’ corporate headquarters and Americas’ sales office are located in Plano, Texas and Milpitas, California. Design, marketing, and engineering centers are located in Plano; Milpitas; Taipei, Taiwan; Taoyuan City, Taiwan; Zhubei City, Taiwan; Manchester, England; and Neuhaus, Germany. Diodes’ wafer fabrication facilities are located in Kansas City, Missouri and Manchester, with an additional facility located in Shanghai, China. Diodes has assembly and test facilities located in Shanghai, Jinan, Chengdu, and Yangzhou, China, as well as in Hong Kong, Neuhaus and Taipei. Additional engineering, sales, warehouse, and logistics offices are located in Taipei; Hong Kong; Manchester; Shanghai; Shenzhen, China; Seongnam-si, South Korea; and Munich, Germany, with support offices throughout the world.

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. Such statements include statements containing forward-looking words such as “expect,” “anticipate,” “sets the stage,” “continuing,” “working diligently to,” “position the Company for,” “aim,” “estimate,” and variations thereof, including without limitation statements, whether direct or implied, regarding expectations of revenue growth, market share gains and increase in gross profits in 2017 and beyond; that for the fourth quarter of 2017, we expect revenue to range between $260 million and $280 million, or down 8.8 to 1.8 percent sequentially; that we expect non-GAAP gross margin to be 35.0 percent, plus or minus 1 percent; that non-GAAP operating expenses, which are GAAP operating expenses adjusted for KFAB closure costs, retention costs and amortization of acquisition-related intangible assets, are expected to be approximately 23.5 percent of revenue, plus or minus 1 percent; that we expect interest expense to be approximately $3.0 million; that our income tax rate is expected to be 29.0 percent, plus or minus 1 percent; and that shares used to calculate diluted EPS for the fourth quarter are anticipated to be approximately 50.8 million. Potential risks and uncertainties include, but are not limited to, such factors as: the risk that such expectations may not be met; the risk that the expected benefits of acquisitions may not be realized or that integration of acquired businesses, such as Pericom, may not continue as rapidly as we anticipate; the risk that we may not be able to maintain our current growth strategy or continue to maintain our current performance, costs and loadings in our manufacturing facilities; the risk that we may not be able to increase our automotive or other revenue and market share; risks of domestic and foreign operations, including excessive operation costs, labor shortages, higher tax rates and our joint venture prospects; the risk that we may not continue our share repurchase program; the risks of cyclical downturns in the semiconductor industry and of changes in end-market demand or product mix that may affect gross margin or render inventory obsolete; the risk of unfavorable currency exchange rates; the risk that our future outlook or guidance may be incorrect; the risks of global economic weakness or instability in global financial markets; the risks of trade restrictions, tariffs or embargoes; the risk of breaches of our information technology systems; and other information including the “Risk Factors” detailed from time to time in Diodes’ filings with the United States Securities and Exchange Commission.

Recent news releases, annual reports and SEC filings are available at the Company’s website: www.diodes.com. Written requests may be sent directly to the Company, or they may be e-mailed to: diodes-fin@diodes.com.

Company Contact:
Diodes Incorporated
Laura Mehrl
Director of Investor Relations
P: 972-987-3959
E: laura_mehrl@diodes.com

Investor Relations Contact:
Shelton Group
Leanne Sievers
President, Investor Relations
P: 949-224-3874
E: lsievers@sheltongroup.com

             
DIODES INCORPORATED AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share data)

             
    Three Months Ended     Nine Months Ended
   

September 30,

    September 30,
      2017       2016         2017       2016  
NET SALES     285,247       250,694         785,774       710,077  
                   
COST OF GOODS SOLD     188,900       170,071         525,377       490,417  
                   
Gross profit     96,347       80,623         260,397       219,660  
                   
OPERATING EXPENSES                  
Selling, general and administrative     43,525       38,321         122,912       119,165  
Research and development     20,379       17,088         58,215       52,247  
Amortization of acquisition-related intangible assets     4,694       5,117         14,098       15,379  
Impairment of fixed assets     1,993       -         1,993       -  
Restructuring     2,039       -         6,108       -  
Other operating expenses     -       144         169       184  
Total operating expenses     72,630       60,670         203,495       186,975  
                   
Income from operations     23,717       19,953         56,902       32,685  
                   
OTHER INCOME (EXPENSES)                  
Interest income     389       321         992       1,075  

Interest expense

Foreign currency loss, net

   

(3,561)

(1,312)

     

(3,684)

(1,439)

       

(10,493)

(6,734)

     

(9,880)

(2,045)

 
Other income     597       480         1,128       551  
Total other expenses     (3,887)       (4,322)         (15,107)       (10,299)  
                   
Income before income taxes and noncontrolling interest     19,830       15,631         41,795       22,386  
                   
INCOME TAX PROVISION     5,052       4,097         11,651       5,941  
                   
NET INCOME     14,778       11,534         30,144       16,445  
                   
Less: NET INCOME attributable to noncontrolling interest     (328)       (886)         (1,298)       (1,778)  
                   
NET INCOME attributable to common stockholders   $ 14,450     $ 10,648       $ 28,846     $ 14,667  
                   
EARNINGS PER SHARE attributable to common stockholders                  
Basic   $ 0.29     $ 0.22       $ 0.59     $ 0.30  
Diluted   $ 0.29     $ 0.21       $ 0.58     $ 0.30  
                   
Number of shares used in computation                  
Basic     49,057       48,814         48,633       48,496  
Diluted     50,416       49,922         50,061       49,565  

Note: Throughout this release, we refer to “net income attributable to common stockholders” as “net income.”

                 
DIODES INCORPORATED AND SUBSIDIARIES
RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME

(in thousands, except per share data)

(unaudited)

 

For the three months ended September 30, 2017:

                 
   

COGS

 

Operating
Expenses

 

Income Tax
Provision

  Net Income
                 
Per-GAAP               $ 14,450
                 
Earnings per share (Per-GAAP)                
Diluted               $ 0.29
                 
Adjustments to reconcile net income to non-GAAP net income:                
                 
M&A Activities                
                 
Pericom                 2,530
                 
Amortization of acquisition-related intangible assets       3,085   (555)    
                 
KFAB                 4,389
                   
Restructuring   -   2,039   (714)      
                   
Shut-down related costs   2,722   -   (953)      
                   
Impairment of fixed assets   -   1,993   (698)      
                   
Others                 1,265
                 
Amortization of acquisition-related intangible assets       1,609   (344)    
                 
Non-GAAP               $ 22,634
                 
    Diluted shares used in computing earnings per share                 50,416
                 
Non-GAAP earnings per share                
    Diluted               $ 0.45

Note:  Included in GAAP and non-GAAP net (loss) income was approximately $3.2 million, net of tax, non-cash share-based compensation expense.  Excluding share-based compensation expense, both GAAP and non-GAAP diluted earnings per share would have improved by $0.06 per share.

             
DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME – Cont.

(in thousands, except per share data)

(unaudited)

 

For the three months ended September 30, 2017:

             
   

Operating
Expenses

 

Income Tax
Provision

  Net Income
             
Per-GAAP           $ 10,648
             
Earnings per share (Per-GAAP)            
Diluted           $ 0.21
             
Adjustments to reconcile net income to non-GAAP net income:            
             
M&A Activities            
             
Pericom             2,980
             
Retention costs   397   (139)    
             
Amortization of acquisition-related intangible assets   3,320   (598)    
             
Others             1,265
             
Amortization of acquisition-related intangible assets   1,797   (372)    
             
Non-GAAP           $ 15,053
             
    Diluted shares used in computing earnings per share             49,922
             
Non-GAAP earnings per share            
    Diluted           $ 0.30

Note:  Included in GAAP and non-GAAP adjusted net income was approximately $2.9 million, net of tax, non-cash share-based compensation expense.  Excluding share-based compensation expense, both GAAP and non-GAAP adjusted diluted earnings per share would have improved by $0.06 per share.

ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE

The Company adjusts United States generally accepted accounting principles (“GAAP”) net income and earnings per share attributable to common stockholders to provide investors a better depiction of the Company’s operating results, allow for a more accurate comparison between the Company’s current and historical operating results and provide a baseline for more informed modeling of future earnings. The Company makes adjustments for inventory acquired, transaction costs, retention costs, amortization of acquisition-related intangible assets and restructuring costs. The Company also excludes these items to evaluate the Company’s operating performance, develop budgets, determine incentive compensation awards and manage cash expenditure. The presentation of the above non-GAAP measures allows investors to review the Company’s results of operations from the same viewpoint as the Company’s management and Board of Directors.  The Company has historically provided similar non-GAAP financial measures to provide investors an enhanced understanding of its operations, facilitate investors’ analyses and comparisons of its current and past results of operations and provide insight into the prospects of its future performance.  The Company also believes the non-GAAP measures are useful to investors because they provide additional information that research analysts use to evaluate semiconductor companies.  These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results and may differ from measures used by other companies.  For example, we do not adjust for any amounts attributable to noncontrolling interest except for one-time non-cash items outside the course of ordinary business, such as impairment of goodwill.  The Company recommends a review of net income on both a GAAP basis and non-GAAP basis be performed to get a comprehensive view of the Company’s results and provides a reconciliation of GAAP net income to non-GAAP adjusted net income.

Detail of non-GAAP adjustments

Retention costs - The Company excluded costs related to employee retention in connection with the Pericom acquisition.   Although these retention costs will be recurring  every quarter until the final retention payment has been made, they are not part of the employees’ normal annual salaries and therefore are being excluded.  The Company believes the exclusion of retention costs related to acquisitions provides investors with a more accurate reflection of costs likely to be incurred in the absence of an unusual event such as an acquisition and facilitates comparisons with the results of other periods that may not reflect such costs.

Amortization of acquisition-related intangible assets – The Company excluded this item, including amortization of developed technologies and customer relationships.  The fair value of the acquisition-related intangible assets, which was recognized through purchase accounting, is amortized using straight-line methods which approximate the proportion of future cash flows estimated to be generated each period over the estimated useful life of the applicable assets.  The Company believes that exclusion of this item is appropriate because a significant portion of the purchase price for its acquisitions was allocated to the intangible assets that have short lives and exclusion of the amortization expense allows comparisons of operating results that are consistent over time for both the Company’s newly acquired and long-held businesses.  In addition, the Company excluded this item because there is significant variability and unpredictability among companies with respect to this expense.

KFAB restructuring – The Company has recorded restructuring charges related to the shutdown and relocation of its wafer fabrication facility located in Lee’s Summit, MO (“KFAB”). These restructuring charges are excluded from management’s assessment of the Company’s operating performance. The Company believes the exclusion of the restructuring charges provides investors an enhanced view of the cost structure of the Company’s operations and facilitates comparisons with the results of other periods that may not reflect such charges or may reflect different levels of such charges.

KFAB shut-down related costs – The Company has recorded shut-down related costs due to the shutdown and relocation of KFAB. These shut-down related costs are excluded from management’s assessment of the Company’s operating performance. The Company believes the exclusion of the shut-down related costs provides investors with a more accurate reflection of the continuing operations of the Company and facilitates comparisons with the results of other periods which may not reflect such costs.

Impairment of fixed assets – The Company has recorded impairment charges related to the shutdown and relocation of KFAB. These impairment charges are excluded from management’s assessment of the Company’s operating performance. The Company believes the exclusion of the impairment charges provides investors with a more accurate reflection of the continuing operations of the Company and facilitates comparisons with the results of other periods which may not reflect such costs.

CASH FLOW ITEMS

Free cash flow (FCF) (Non-GAAP)

FCF for the third quarter of 2017 is a non-GAAP financial measure, which is calculated by subtracting capital expenditures from cash flow from operations.  For the third quarter of 2017, FCF was a $2.9 million ($40.9 million less $38.0 million).  FCF represents the cash and cash equivalents that we are able to generate after taking into account cash outlays required to maintain or expand property, plant and equipment. FCF is important because it allows us to pursue opportunities to develop new products, make acquisitions and reduce debt.

CONSOLIDATED RECONCILIATION OF NET INCOME TO EBITDA

EBITDA represents earnings before net interest expense, income tax provision, depreciation and amortization. Management believes EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties, such as financial institutions in extending credit, in evaluating companies in our industry and provides further clarity on our profitability. In addition, management uses EBITDA, along with other GAAP and non-GAAP measures, in evaluating our operating performance compared to that of other companies in our industry. The calculation of EBITDA generally eliminates the effects of financing, operating in different income tax jurisdictions, and accounting effects of capital spending, including the impact of our asset base, which can differ depending on the book value of assets and the accounting methods used to compute depreciation and amortization expense. EBITDA is not a recognized measurement under GAAP, and when analyzing our operating performance, investors should use EBITDA in addition to, and not as an alternative for, income from operations and net income, each as determined in accordance with GAAP. Because not all companies use identical calculations, our presentation of EBITDA may not be comparable to similarly titled measures used by other companies. For example, our EBITDA takes into account all net interest expense, income tax provision, depreciation and amortization without taking into account any attributable to noncontrolling interest. Furthermore, EBITDA is not intended to be a measure of free cash flow for management’s discretionary use, as it does not consider certain cash requirements such as tax and debt service payments.

The following table provides a reconciliation of net income to EBITDA (in thousands, unaudited):

         
    Three Months Ended   Nine Months Ended
    September 30,   September 30,
      2017     2016       2017     2016
                 
Net income (per-GAAP)   $ 14,450   $ 10,648     $ 28,846   $ 14,667
Plus:                
Interest expense, net     3,172     3,363       9,501     8,805
Income tax provision     5,052     4,097       11,651     5,941
Depreciation and amortization     24,096     24,371       71,195     74,731
EBITDA (non-GAAP)   $ 46,770   $ 42,479     $ 121,193   $ 104,144
         
DIODES INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
         
    September 30,   September 30,
      2017       2016  
    (unaudited)   (audited)
CURRENT ASSETS        
Cash and cash equivalents   $ 201,226     $ 247,802  
Short-term investments     12,737       29,842  
Accounts receivable, net     230,460       217,217  
Inventories     211,412       193,483  
Prepaid expenses and other     45,644       44,438  
Total current assets     701,479       732,782  
         
PROPERTY, PLANT AND EQUIPMENT, net     446,052       401,988  
         
DEFERRED INCOME TAXES, non-current     64,129       56,047  
         
OTHER ASSETS        
Goodwill     133,538       129,412  
Intangible assets, net     161,122       174,876  
Other     34,269       33,447  
Total assets   $ 1,540,589     $ 1,528,552  
         
         
CURRENT LIABILITIES        
Accounts payable   $ 111,689     $ 87,600  
Accrued liabilities     94,436       71,562  
Income tax payable     -       11,855  
Current portion of long-term debt     19,067       14,356  
Total current liabilities     225,192       185,373  
         
LONG-TERM DEBT, net of current portion     306,687       413,126  
DEFERRED TAX LIABILITIES - non current     28,617       28,213  
OTHER LONG-TERM LIABILITIES     85,209       81,373  
Total liabilities     645,705       708,085  
         
COMMITMENTS AND CONTINGENCIES        
         
EQUITY        
Diodes Incorporated stockholders' equity        
Preferred stock - par value $1.00 per share; 1,000,000 shares authorized; no shares issued or outstanding            
Common stock - par value $0.66 2/3 per share; 70,000,000 shares authorized; 49,091,693 and 48,219,376 issued and outstanding at September 30, 2017 and December 31, 2016, respectively     33,501       32,919  
Additional paid-in capital     375,134       354,574  
Retained earnings     563,338       530,215  
Treasury stock, at cost, 1,157,206 and 466,010 shares held at December 31,2016 and December 31, 2015, respectively     (29,023)       (29,023)  
Accumulated other comprehensive loss     (89,707)       (112,666)  
Total Diodes Incorporated stockholders' equity     853,243       776,019  
Noncontrolling interest     41,641       44,448  
Total equity     894,884       820,467  
Total liabilities and equity   $ 1,540,589     $ 1,528,552  

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