Included in fourth quarter 2016 GAAP net income and non-GAAP adjusted net income was approximately $0.8 million, net of tax, of non-cash share-based compensation expense. Excluding share-based compensation expense, both GAAP EPS and non-GAAP adjusted EPS would have increased by $0.02 per share for fourth quarter 2016, $0.06 for third quarter 2016, and $0.05 for fourth quarter 2015.
EBITDA (a non-GAAP measure), which represents earnings before net interest expense, income tax, depreciation and amortization, for fourth quarter 2016, was $29.2 million, compared to $42.5 million for third quarter 2016 and $16.6 million for fourth quarter 2015. For a reconciliation of GAAP net income to EBITDA, see the table near the end of this release for further details.
For fourth quarter 2016, net cash provided by operating activities was $49.8 million. Net cash flow was $27.3 million, including the stock repurchase. Free cash flow was $38.3 million, which includes $11.5 million of capital expenditures.
As of December 31, 2016, the Company had approximately $278 million in cash, cash equivalents and short-term investments, long-term debt totaled approximately $415 million, and working capital was approximately $547 million.
During the fourth quarter, Diodes returned approximately $18.0 million of cash to stockholders by repurchasing approximately 691,196 shares of common stock under its previously announced share repurchase program. From the beginning of the share repurchase program in November 2015, Diodes has purchased a total of approximately 1,157,206 shares for an aggregate purchase price of $29 million, representing approximately 2 percent of shares outstanding.
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 Annual Report on Form 10-K for the year ending December 31, 2016.
Dr. Lu concluded, “For the first quarter of 2017, we expect revenue to range between $220 million and $240 million, or down 5.2 to up 3.4 percent sequentially, reflecting typical seasonality as well as a one month impact from the KFAB fire. We expect gross margin to be 28.5 percent, plus or minus 1 percent. Non-GAAP operating expenses, which are GAAP operating expenses adjusted for retention costs and amortization of acquisition-related intangible assets, are expected to be approximately 25.0 percent of revenue, plus or minus 1 percent. We expect other expense to be approximately $4.3 million which includes $1.5 million of KFAB cleanup and repair cost. Our income tax rate is expected to be 29 percent, plus or minus 3 percent. Shares used to calculate diluted EPS for the first quarter are anticipated to be approximately 50.4 million. Please note that purchase accounting adjustments for Pericom and previous acquisitions of $4.2 million after tax are not included in these non-GAAP estimates.”
As previously mentioned, Diodes’ KFAB facility will cease operations late in the third quarter 2017 with production moved to other Diodes’ wafer fabs and external foundries and the premises vacated by November 15, 2017. The pre-tax closure costs are expected to be $10 million to $12 million in 2017 with approximately $1.1 million in first quarter 2017. These shutdown costs have not been included in the above estimates.
Diodes will host a conference call on Tuesday, February 14, 2017 at 4:00 p.m. Central Time (5:00 p.m. Eastern Time) to discuss its fourth quarter and fiscal 2016 financial results. Investors and analysts may join the conference call by dialing 1-855-232-8957 and providing the confirmation code 53437196. International callers may join the teleconference by dialing 1-315-625-6979 and enter 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 February 21, 2017 at midnight Central Time. The replay number is 1-855-859-2056 with a pass code of 53437196. 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 http://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 is located in Plano, Texas 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.