STATS ChipPAC Reports Fourth Quarter and Full Year 2009 Results

SINGAPORE--1/28/2010, UNITED STATES--(Marketwire - January 28, 2010) - STATS ChipPAC Ltd. ("STATS ChipPAC" or the "Company") (SGX-ST: STATSChP), a leading semiconductor test and advanced packaging service provider, today announced results for the fourth quarter and full year 2009.

Tan Lay Koon, President and Chief Executive Officer of STATS ChipPAC, said, "We delivered another strong quarter with significant improvement in profitability. Revenue for fourth quarter of 2009 increased by 21.6% over the corresponding quarter a year ago and by 1.3% over prior quarter to $394.7 million. Revenue for the full year 2009 of $1,325.7 million decreased by 20.0% over prior year. Our fourth quarter revenue growth reflected continued recovery in the semiconductor industry. As a result of higher savings realized from our cost reduction efforts and richer product mix, profitability for the quarter significantly improved over corresponding quarter a year ago and prior quarter."

Net income for fourth quarter of 2009 was $33.8 million or $0.02 of net income per diluted ordinary share, compared to net loss of $22.1 million or $0.01 of net loss per diluted ordinary share in the corresponding quarter a year ago and net income of $25.1 million or $0.01 of net income per diluted ordinary share in the prior quarter. Net income for the full year 2009, including restructuring charges of $16.1 million, was $10.1 million or $0.00 of net income per diluted ordinary share, compared to net income of $25.7 million or $0.01 of net income per diluted ordinary share in 2008.

John Lau, Chief Financial Officer of STATS ChipPAC, said, "Our gross margin in the fourth quarter of 2009 was 21.2% compared to 11.6% in the corresponding quarter a year ago and 20.2% in the prior quarter. Operating margin for fourth quarter of 2009 was 11.4% of revenue compared to (4.1)% in the corresponding quarter a year ago and 9.4% in the prior quarter. Capital spending in the fourth quarter and full year of 2009 was $76.2 million and $159.2 million or 19.3% and 12.0% of revenue compared to $22.4 million and $239.0 million or 6.9% and 14.4%, respectively, in the prior year. Capital spending increased in the fourth quarter of 2009 as we invested in additional capacity in wafer packaging and flip chip bumping ahead of anticipated ramp. We ended the fourth quarter of 2009 with record cash, cash equivalent and marketable securities of $368.1 million and debt of $458.0 million, compared to $352.8 million and $473.5 million, respectively, as of the fourth quarter of 2008."

Forward-looking Statements

Certain statements in this release are forward-looking statements that involve a number of risks and uncertainties that could cause actual events or results to differ materially from those described in this release. Factors that could cause actual results to differ include, but are not limited to, deterioration in general business and economic conditions and the state of the semiconductor industry; prevailing market conditions; demand for end-use applications products such as communications equipment, consumer and multi-applications and personal computers; decisions by customers to discontinue outsourcing of test and packaging services; level of competition; our reliance on a small group of principal customers; our continued success in technological innovations; customer credit risks; possible future application of push-down accounting; pricing pressures, including declines in average selling prices; intellectual property rights disputes and litigation; our ability to control operating expenses; our substantial level of indebtedness and access to credit markets; our ability to generate cash; potential impairment charges; availability of financing; adverse tax and other financial consequences if the taxing authorities do not agree with our interpretation of the applicable tax laws; classification of the Company as a passive foreign investment company; our ability to develop and protect our intellectual property; rescheduling or canceling of customer orders; changes in our product mix; our capacity utilization; delays in acquiring or installing new equipment; limitations imposed by our financing arrangements which may limit our ability to maintain and grow our business; returns from research and development investments; changes in customer order patterns; shortages in supply of key components; disruption of our operations; loss of key management or other personnel; defects or malfunctions in our testing equipment or packages; changes in environmental laws and regulations; our ability to meet specific conditions imposed for the continued listing or delisting of our ordinary shares under the Singapore Exchange Securities Trading Limited ("SGX-ST"); exchange rate fluctuations; regulatory approvals for further investments in our subsidiaries; majority ownership by Temasek Holdings (Private) Limited ("Temasek") that may result in conflicting interests with Temasek and our affiliates; unsuccessful acquisitions and investments in other companies and businesses; labor union problems in South Korea; uncertainties of conducting business in China and changes in laws, currency policy and political instability in other countries in Asia; natural calamities and disasters, including outbreaks of epidemics and communicable diseases; and other risks described from time to time in the Company's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F dated March 9, 2009. You should not unduly rely on such statements. We do not intend, and do not assume any obligation, to update any forward-looking statements to reflect subsequent events or circumstances.

Our 52-53 week fiscal year ends on the Sunday nearest and prior to December 31. Our fiscal quarters end on a Sunday and are generally thirteen weeks in length. Our fourth quarter of 2009 and fiscal year 2009 ended on December 27, 2009, while our fourth quarter of 2008 and fiscal year 2008 ended on December 28, 2008. References to "US GAAP" are to Generally Accepted Accounting Principles as practiced in the United States of America and references to "$" are to the lawful currency of the United States of America.

About STATS ChipPAC Ltd.

STATS ChipPAC Ltd. is a leading service provider of semiconductor packaging design, assembly, test and distribution solutions in diverse end market applications including communications, digital consumer and computing. With global headquarters in Singapore, STATS ChipPAC has design, research and development, manufacturing or customer support offices in 10 different countries. STATS ChipPAC is listed on the SGX-ST. Further information is available at www.statschippac.com. Information contained in this website does not constitute a part of this release.

                            STATS ChipPAC Ltd.
              Condensed Consolidated Statements of Operations
      (In thousands of U.S. Dollars, except share and per share data)
                                (Unaudited)

                           Three Months Ended       Twelve Months Ended
                        ------------------------  ------------------------
                        December 28, December 27, December 28, December 27,
                           2008         2009         2008         2009
                        ----------   -----------  -----------  -----------
Net revenues            $  324,613   $   394,734  $ 1,658,188  $ 1,325,685
Cost of revenues          (286,812)     (311,195)  (1,383,797)  (1,117,308)
                        ----------   -----------  -----------  -----------
Gross profit                37,801        83,539      274,391      208,377

Operating expenses:
  Selling, general and
   administrative           28,959        24,689      118,337       95,516
  Research and
   development               8,441        13,918       37,825       43,358
  Restructuring charges     13,760             -       19,790       16,072
  Equipment impairment           -             -       21,091            -
  Accelerated share-based
   compensation                  -             -        1,562            -
                        ----------   -----------  -----------  -----------
    Total operating
     expenses               51,160        38,607      198,605      154,946
                        ----------   -----------  -----------  -----------

Operating income (loss)    (13,359)       44,932       75,786       53,431
Other income
 (expenses), net            (8,999)       (6,438)     (26,464)     (38,693)
                        ----------   -----------  -----------  -----------
Income (loss) before
 income taxes              (22,358)       38,494       49,322       14,738
Income tax benefit
 (expense)                     378        (3,245)     (19,172)      (3,712)
                        ----------   -----------  -----------  -----------
Net income (loss)          (21,980)       35,249       30,150       11,026
Less: Net income
 attributable to the
 noncontrolling
 interest                     (169)       (1,414)      (4,448)        (973)
                        ----------   -----------  -----------  -----------
Net income (loss)
 attributable to
 STATS ChipPAC Ltd.     $  (22,149)  $    33,835  $    25,702  $    10,053
                        ==========   ===========  ===========  ===========

Net income (loss) per
 ordinary share
 attributable to
 STATS ChipPAC Ltd.:
  Basic                 $    (0.01)  $      0.02  $      0.01  $      0.00
  Diluted               $    (0.01)  $      0.02  $      0.01  $      0.00

Ordinary shares (in
 thousands) used in
 per ordinary share
 calculation:
  Basic                  2,202,192     2,202,218    2,143,934    2,202,218
  Diluted                2,202,192     2,202,236    2,146,249    2,202,230

Key Ratios and
 Information:
Gross Margin                  11.6%         21.2%        16.5%        15.7%
Operating Expenses
 as a % of Revenue            15.7%          9.8%        11.9%        11.7%
Operating Margin              (4.1)%        11.4%         4.6%         4.0%

Depreciation &
 Amortization,
 including
 Amortization of Debt
 Issuance Costs         $   68,376   $    67,169  $   286,428  $   268,349
Capital Expenditures    $   22,441   $    76,223  $   239,020  $   159,222



                            STATS ChipPAC Ltd.
                  Condensed Consolidated Balance Sheets
                      (In thousands of U.S. Dollars)

                                                 December 28,  December 27,
                                                    2008          2009
                                                 -----------   -----------
                                                               (Unaudited)
ASSETS
Current assets:
  Cash, cash equivalents and marketable
   securities                                    $   337,230   $   351,195
  Accounts receivable, net                           139,520       208,766
  Inventories                                         60,717        61,859
  Other current assets                                33,841        52,215
                                                 -----------   -----------
    Total current assets                             571,308       674,035

  Marketable securities                               15,587        16,929
  Property, plant and equipment, net               1,216,342     1,115,497
  Investment in equity investee                        9,001         7,743
  Goodwill and intangible assets                     595,894       591,125
  Other non-current assets *                          38,931        21,611
                                                 -----------   -----------
    Total assets                                 $ 2,447,063   $ 2,426,940
                                                 -----------   -----------

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Accounts and other payables                    $   148,931   $   182,704
  Other current liabilities                          152,836       103,394
  Short-term debts                                    76,953       224,786
                                                 -----------   -----------
    Total current liabilities                        378,720       510,884
Long-term debts                                      396,500       233,181
Other non-current liabilities                         64,144        59,329
                                                 -----------   -----------
    Total liabilities                                839,364       803,394
                                                 -----------   -----------
STATS ChipPAC Ltd. shareholders' equity            1,548,657     1,564,669
                                                 -----------   -----------
Noncontrolling interest                               59,042        58,877
                                                 -----------   -----------
    Total liabilities and equity                 $ 2,447,063   $ 2,426,940
                                                 -----------   -----------

* Includes $1.0 million and $0.4 million of non-current restricted cash as
  of December 28, 2008 and December 27, 2009, respectively.



                            STATS ChipPAC Ltd.
                      Other Supplemental Information
                                (Unaudited)

                                                 4Q 2008  3Q 2009  4Q 2009
Net Revenues by Product Line
Packaging - laminate                                55.0%    59.4%    56.7%
Packaging - leaded                                  18.0%    14.4%    15.2%
Test and other services                             27.0%    26.2%    28.1%
                                                 -------  -------  -------
                                                   100.0%   100.0%   100.0%
                                                 =======  =======  =======
Net Revenues by End User Market
Communications                                      48.2%    48.6%    48.8%
Personal Computers                                  21.8%    18.2%    17.7%
Consumer, Multi-applications and Others             30.0%    33.2%    33.5%
                                                 -------  -------  -------
                                                   100.0%   100.0%   100.0%
                                                 =======  =======  =======
Net Revenues by Region
United States of America                            69.0%    72.4%    65.5%
Europe                                               8.3%     4.9%     8.3%
Asia                                                22.7%    22.7%    26.2%
                                                 -------  -------  -------
                                                   100.0%   100.0%   100.0%
                                                 =======  =======  =======

Number of Testers                                    977      973      962
Number of Wirebonders                              4,684    4,554    4,538

Overall Equipment Utilization Rate                    48%      60%      64%

Contact Information: Investor Relations Contact: Tham Kah Locke Vice President of Corporate Finance Tel: (65) 6824 7788 Fax: (65) 6720 7826 email: Media Contact: Lisa Lavin Deputy Director of Corporate Communications Tel: (208) 867 9859 email: