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ASE provides update on remedying toxic dumping

TAIPEI, Taiwan -- Advanced Semiconductor Engineering (ASE, 日月光) announced its latest operating performance results yesterday during an earnings conference, while providing an outline of the company's plans to remedy last year's toxic dumping incident.

ASE CEO Wu Tien-yu (吳田玉) emphasized that the toxic waste water dumping at its Kaohsiung-based K7 plant last year was an isolated instance, and that since the incident the company have been striving to resolve the situation, going above and beyond in commitments towards meeting government guidelines.

In addition to internal reassessing and reforming the company's internal controls, Wu showcased an upcoming central command room that will provide real-time monitoring of all ASE production facilities. Wu stated that the company's expertise in the semiconductor sector will be applied in the establishment of a comprehensive system capable of automated detection of toxic leakage. The company previously relied on manual interpretation and monitoring at the company's numerous manufacturing facilities, which led to missteps in internal communication, Wu said, adding that as the company's new waste water disposal and monitoring systems continue to be refined, a repeat of last year's disaster would be prevented. Wu also welcomed the company's peers in the sector to replicate ASE's systems to minimize environmental impact.

In an attempt to allay public concern, the company said it will publish real-time monitoring statistics for all interested parties, adding that following the conclusion of its internal procedures, external experts will be included in an upcoming assessment conference later this month.

Wu however declined to comment on the fate of the K7 plant, and provided no time table on when the facility might resume production. Wu also stated that since reports of the incident went public, the company has retained the trust and support of its employees, investors, clients and peers in the sector, but acknowledge that ASE must improve its commitment to corporate social responsibility and strive to maintain the interest of the public.

Although the company did not incur tangible losses as a result of the dumping incident, sentiment among its clients has been affected, Wu said. In addition, the closure of the K7 plant is expected to lay a 4 to 5 percent impact to first quarter operating results this year, as the company has been ordered by the government to suspend production of nickel wafers.

Record-high 2013 Results

ASE garnered record high revenues of NT$219.8 billion last year, generating an after-tax net income of NT$16.296 billion on gross profits of margins of 19.5 percent, with earnings-per-share performance rated at NT$2.11.

Meanwhile, institutional investors yesterday expressed an upbeat outlook on the company's progress in transitioning towards producing more advanced system-in-package (SiP) capable of providing solutions for WiFi connectivity and fingerprint reading. The new product line may represent as much as 25 percent of overall revenue this year, according to institutional investors.

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