Hsinchu, Taiwan, August 20, 2008 — ChipMOS TECHNOLOGIES (Bermuda) LTD. ("ChipMOS" or the "Company") (NASDAQ: IMOS) today reported unaudited consolidated financial results for the second quarter ended June 30, 2008. All U.S. dollar figures in this release are based on the exchange rate of NT$30.36 against US$1.00 as of June 30, 2008.

Net revenue on a US GAAP basis for the second quarter of 2008 was NT$4,817.1 million or US$158.7 million, an increase of 0.8% from NT$4,779.0 million or US$157.4 million in the first quarter of 2008 and a decrease of 17.4% from NT$5,833.5 million or US$192.1 million for the same period in 2007. Under US GAAP, the gross margin for the second quarter of 2008 was 7.2%, compared to 9.1% for the first quarter of 2008 and 27.6% for the same period in 2007.

Net loss on a US GAAP basis for the second quarter of 2008 was NT$674.5 million or US$22.2 million, and NT$8.04 or US$0.26 per basic common share, compared to net income of NT$209.0 million or US$6.9 million, and NT$2.49 or US$0.08 per basic common share, for the first quarter of 2008. Net income under US GAAP includes non-cash gains for changes in the fair value of the embedded derivative liabilities of NT$31.3 million or US$1.0 million and amortization of discount on convertible notes of NT$85.5 million or US$2.8 million for the second quarter of 2008 and non-cash gains for changes in the fair value of the embedded derivative liabilities of NT$129.6 million or US$4.3 million and amortization of discount on convertible notes of NT$86.7 million or US$2.9 million for the first quarter of 2008. Excluding the above special items regarding non-cash gains for changes in the fair value of the embedded derivative liabilities and the convertible notes, non-GAAP adjusted net loss for the second quarter of 2008 was NT$620.3 million or US$20.4 million, and NT$7.40 or US$0.24 per basic common share, compared to non-GAAP adjusted net income of NT$166.1 million or US$5.5 million, and NT$1.98 or US$0.07 per basic common share in the first quarter of 2008.

The unaudited consolidated financial results of ChipMOS for the second quarter ended June 30, 2008 included the financial results of ChipMOS TECHNOLOGIES INC., ChipMOS Japan Inc., ChipMOS U.S.A., Inc., ChipMOS TECHNOLOGIES (H.K.) Limited, MODERN MIND TECHNOLOGY LIMITED and its wholly-owned subsidiary ChipMOS TECHNOLOGIES (Shanghai) LTD., and ThaiLin Semiconductor Corp.

S.J. Cheng, Chairman and Chief Executive Officer of ChipMOS, said, "We are pleased to report that our revenue in the second quarter was within our stated guidance. Gross margin in the second quarter of 2008 declined as compared to the first quarter of 2008 primarily due to lower capacity utilization in memory final testing and price erosion of our DRAM business. Flash revenues declined 7% quarter over quarter and contributed to around 29% of our total revenue in Q2, down from 32% in the previous quarter. In a more positive light, among our flash sector, Mask ROM revenues were up 10% quarter over quarter and contributed to 7% of flash revenue. Mixed-signal revenues were also up 11% quarter over quarter and contributed to 8% of our total revenue. Revenues from our LCD driver IC increased 3% in the second quarter of 2008 compared to the first quarter of 2008, reflecting a brief recovery in demand from our customers. DRAM revenues remained relatively flat, up 1% in the second quarter of 2008 compared to the previous quarter."

S.K. Chen, Chief Financial Officer of ChipMOS, said, "Our CapEx in the second quarter was US$15.2 million, which was down from US$26.2 million in the first quarter of 2008. In July, we received the final approval from Shanghai government to cut down our capital investment obligation before end of this year to US$130 million. We have completed our obligation by investing the remaining US$7.5 million of investment commitment in early August. Combining our cash position and undrawn credit lines provided by banks, we have more than sufficient financial resources to face the debt due in 2008. There is no urgent need for The Company to raise additional fund in any form from the market."

Third Quarter 2008 Outlook

Mr. Cheng continued, "The overall DRAM market visibility in following quarters remains limited. We do not anticipate the recovery of our DRAM business due to weaker than expected PC demand. We remain cautious on the LCD market due to weak seasonal demand. However, we still notice better demands from our customers in Q4 as compared to Q3. In addition, gold bumping business will maintain its growth momentum in the second half due to new customer programs. Mask ROM and mixed-signal revenues should continue to grow with the increase in demands from customers. Considering the overall market situation among our product segments, we currently expect that Q3 revenue to be in the range of approximately US$149 million to US$159 million, which is down 6% to flat as compared to Q2, and gross margin to be in the range of 2.5% to 5.5%. In the current down cycle, we are strongly confident in our ability to maintain healthy operations and we plan to continue our disciplined capital expenditures and to strictly focus on cost savings and customer expansion."

Investor Conference Call / Webcast Details

ChipMOS will review detailed second quarter 2008 results on Wednesday, August 20, 2008 at 7:00PM ET (7:00AM, August 21, Taiwan time). The conference call-in number is 1-201-689-8562. A live webcast of the conference call will be available at ChipMOS' website at http://www.chipmos.com/. The playback will be available in 2 hours after the conclusion of the conference call and will be accessible by dialing 1-201-612-7415. The account number to access the replay is 3055 and the confirmation ID number is 291371.

About ChipMOS TECHNOLOGIES (Bermuda) LTD.:
ChipMOS (http://www.chipmos.com/) is a leading independent provider of semiconductor testing and assembly services to customers in Taiwan, Japan, and the U.S. With advanced facilities in Hsinchu and Southern Taiwan Science Parks in Taiwan and Shanghai, ChipMOS and its subsidiaries provide testing and assembly services to a broad range of customers, including leading fabless semiconductor companies, integrated device manufacturers and independent semiconductor foundries.

Forward-Looking Statements

Certain statements contained in this announcement may be viewed as "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual performance, financial condition or results of operations of the Company to be materially different from any future performance, financial condition or results of operations implied by such forward-looking statements. Further information regarding these risks, uncertainties and other factors is included in the Company's most recent Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission (the "SEC") and in the Company's other filings with the SEC.

Use of Non-GAAP Information

Readers are reminded that non-GAAP numbers contained in this announcement are merely a supplement to, and not a replacement for, the GAAP financial measures. These non-GAAP numbers should be read in conjunction with the US GAAP financial measures. It should be noted as well that the non-GAAP information provided in this announcement may be different from the non-GAAP information provided by other companies.

 

 

Contacts:
In Taiwan
Dr. S.K. Chen
ChipMOS TECHNOLOGIES (Bermuda) LTD.
+886-6-507-7712
s.k._chen@chipmos.com

In the U.S.
Joseph Villalta
The Ruth Group
+1-646-536-7003
jvillalta@theruthgroup.com