Good day everyone and welcome to the ASE Conference Call. For the duration of presentation, all lines will be placed in listen-only mode. A question-and-answer session will follow after the main presentation. You may register your wish to ask a question by pressing “*” “1” on your telephone keypad. And I would like to hand the call over to Mr. Joseph Tung and I will be standing by for the Q& A session. Mr. Tung you may now begin, thank you.

Thank you. Good morning and good evening everyone. Thank you for attending our Q4 2005 Earning Release Conference Call. And again as a reminder, the presentation is being webcasted. Please go to our website www.aseglobal.com where you can find the presentation. Before I start the presentation, as a reminder all the numbers that are being presented today in the quarter as far as to give comparison, excludes ASE Malaysia camera module operation, which was sold to Flextronics in last October and is therefore treated as discontinued operation. Only the operation’s net profit and loss figure are being presented as a separate item. If you please move to page-3. Look at the sequential comparison of our Q4 performances. We had a very strong Q4, as our consolidate revenue grew 21% sequentially to reach NT $226.4 billion, due to overall stronger than expected demand and stable pricing environment. Gross profit expanded 60% to NT $6.5 billion while operating profit grew 117% to NT $4.2 billion. Spending on non-operating expenses pretax income amounted to NT $3.3 billion. Net income after tax and minority interest grew to NT $2.9 billion after recognizing tax of NT $ 46 million, income from discontinued operation of NT $230 million, and minority interest adjustment of NT $540 million. EPS for the quarter was NT $0.64. Comparing to the previous quarter, Assembly revenue grew 23%, test revenue grew 19% and Module Assembly revenue grew 8%, after taking our ASE Malaysia camera module business. Separately, material revenue grew 61%, as we aggressively ramped up our overseas PBGA substrate operation for 11 million units in September to over 20 million units in December. You know additional rate of both Assembly and Test stay high, at over 95% due to higher volume. ASP was up slightly, due to favorable product mix shift…

Q – Szeho Ng: Hi, Joseph congratulation on a great quarter.

Thank you. Q – Szeho Ng: Yeah, one quick question. Earlier you mentioned your 12-inch Bumping line, it is actually running at around 65 to 75 utilization, is there a low utilization because of you or the demand?

I think, we are in the initial, early stage of wrapping up the Bumping. The fact that there is more to come, we are expecting much more demand starting from March period. And we are actually planning on expanding the 12-inch Bumping capacity and anticipating some of the increased volume from few of our customers in this area. Q – Szeho Ng: Can you share with me, maybe the capacity expansion timeframe for wafer bumping line, for the rest of the year?

Right now, in first quarter we only are looking at about 15 million worth of Bumping CapEx. Q – Szeho Ng: Uh Huh. I see.

For the rest of the year, I think we would need to look at the performance of that operation. Q – Szeho Ng: I see, okay, all right thank you very much.

Thank you.

Thank you, sir. Our next question is coming from Andrew Dicks from the US. Please go ahead. Q – Andrew Dicks: Good evening, a quick question on the PC segment in Q1,, I am wondering if you could characterize demand from both Graphics and Chipset, and how you see that trend throughout the quarter? Thank you.

We are, flip is seeing a bit of inventory adjustment, particularly in the chipset area, but that’s really looking it from our own portfolio per say, and from the forecast from our customers, there seems to be some slowdown in the chipset sector, but it’s not being out of the – since nothing exceptional really is, I think from the PC sector as the whole its still growing within the seasonal pattern. Q – Andrew Dicks: Okay, great, if I could ask one quick follow up on your expected insurance payments, could you talk about what else you expect this year in terms of reimbursement from the fire?

Without giving an exact number, we are aggressively negotiating with the Insurance Company and hopping to have a final settlement by later part of the second quarter. Q – Andrew Dicks: Okay, great thank you very much.

Thank you.

Thank you sir for your question. Our next question is coming from Shilus Justley (phonetics) from Singapore. Please go ahead.

Hi, Joseph very good quarter.

Thank you.

Congratulations. Wanted to understand that given the widespread and well documented shortages particularly in the Testing space, have you seen any changes in the business models the way Company operate, particularly from the customers point of view, have you seen any changes in the risk sharing in this environment to the extent of pay-for-pay type of commitments are any participation in the CapEx by the customers?

Well I think it’s the continuous effort from our part, try to mitigate the risk associated with the test operation, if you know this is the very capital intensive business and has very high operating leverage. Utilization of our capacity is really a key of everything. So, in this front we are trying very hard to kind of different kind of models with our customers including sharing the capacity expansion or sometimes we ask customers to confine some of that and also cases where we actually buy some Testers and confine it to our customer for them to use the testers themselves, while we charge them the Tested hours. There are various ways of managing that. I think at this point, we have to find a mutually beneficial way to go with our customer on Test capacity.

Do you have seen any success in terms of pay-for-pay kind of agreements with the customers?

Not to the extend of pay-go-pay 25.18, but we do want to have – we want to be far more certain about that, whatever business that we are taking on, should have a longer term nature instead of just a short order, before we make any purchase addition on any new Testers.

And how do you ensure this that the customer commits the volumes for the longer term?

I don’t think we can ever ensure, but you know through the close working relationship with our customers, I think we can have fairly good idea, on how we run the business desk and if we felt one time, we will be the more care for the expect and that’s may not be to the benefit of our customer.

Okay, one last question that quarter before last, you had alluded to the fact that all the Engineering Wafers and the Testing Wafers, you would aspire to have premium pricing, firstly have you succeeded and if so, if you could quantify what kind of premium you are able to generate?

If you turn around, first of all, I think the effort is the successful one is been shown in our expansion in our margin. And of course, there will be some business needs to be felled if cannot rise our prices on what services that we provide. By and large I think the effort was a successful one and if it is ending on the worst, sometimes the prices can be raised by two times or even three times.

Okay, thank you.

Yeah.

Thank you, sir. Our next question is coming from Timothy S. Cohen (phonetics) . Please go ahead. Q – Timothy Cohen: Hi guys, actually I had two. First of all, I have in my notes that back in 2004, you said about $220 million in cash, CapEx and I believe at time that added roughly 10% to 15% year-over-year capacity, your guiding CapEx in ’06 about one quarter of that level, and I am wondering what the equivalent capacity that would be for that spending? A – Freddie Liu: As is the rule of the thumb, these dollar investment increases to 60% of revenue - annual revenue, so adding a $50 million gaining about $30 million revenue. Q – Timothy Cohen: Okay, But, I guess where I am going with this is given that the pricing for Testers has come down pretty significantly, can you add a number for $50 million, that is comparable to a number, a couple of years ago, that you could have added for $200 million?

Capacity wise? Q – Timothy Cohen: Yes.

I don’t have that number I think a quarter of the investments will remain in the same capacity as-. Q – Timothy Cohen: Yeah, I am just kind of wondering whether you getting more bank for you bucks, so CapEx is going down by a lot, relative to what you spent in 2004, but I am wondering whether you can had add a level of capacity that’s roughly comparable or atleast close to what you added in 2004? A – Freddie Liu: Well, not as close to what we added on the quarter in this progress, but I think that the testing time actually get longer, and so you may tamper off with the pricing plan, as you could. But, we do care more extension of final of this quarter. So, we do get well for it. Q – Timothy Cohen: I got you, okay. Thanks for it and then I guess that the question is, two more things, the number one; have you seen any cancellations, we heard about some cancellations in the handset world and certainly in the chipset world for some other outside vendors and I am wondering whether you have seen any cancellations, I mean I also wanted to ask about die bank and that sort of thing? A – Freddie Liu: No, not so much as cancellations, there are ofcourse fluctuations in the business volume from expected customers, but no cancellations from our part. Q – Timothy Cohen: And then how about the die bank inventories? A – Freddie Liu: I think, may be in the Chipset the die-bank is bit longer, but other than that everything else is a bit stable. Q – Timothy Cohen: So, you generally not worried about any end market except for Chipset? A – Freddie Liu: Even for Chipset, we are not that worried. I think we still within the manageable level, although it is a bit longer than what we used to see, before. Q – Timothy Cohen: I see, okay, thank a lot. A – Freddie Liu: Thank you.

Thank you, sir. Our next question is coming from Mari Hoshimi from the US. Please go ahead. Q – Mari Hoshini: Hi, this is the follow up to your comments regarding chipset, helping me understand is that a primarily in the end market or does it extend into the graphic as the inventory build up, and then I think you are added a significant amount of substrate capacity, what was it based on – is it just, you are looking at your customers build rate or bidding even in ’06, and you are adding capacity to the extend that your forecast are increasing especially in a Graphic, Chipset area?

In terms of substrate I think what we have in mind is to continue to increase our self-supply ratio, as I mentioned right now we are only supplying roughly 35% of our own consumption. And I think, we are – we like to rise this ratio to about 60% by the yearend, and with that I think there will be – we also want to expand our business in the sense that to go for some direct sales to other customers as well to – may be not do assembling with us, either. And the first part of your question is? Q – Mari Hoshini: The first part of the question going back to your comments that regarding increasing inventory or even die-bank for a chipset, is that primarily from a computing end market or does it extend into the graphics as well?

I think we were just referring to chipset, and I think as I mentioned earlier on, what we are seeing is the PC sector seems to be performing with the normal seasonal pattern, where as the first and second quarter were typically slower season for PC and we are merely looking at our own portfolio, customer portfolio looking as your forecast to die-bank situation and we are not trying to say that – we are referring to the PC sector as a whole. We are only looking at our own portfolio, I think what we are seeing could be the result of some market share shift among different players, in the PC sector. Q – Mari Hoshini: Sure, and to that extent are you seeing continual improvement in the forecast for some of your Graphic customers especially, with the new game console coming out, we are hearing that there may be some bottleneck down the supply chain and I am trying to understand or get some more color as to what extent is bottleneck is impacting your orders?

Our shipment for game console remains pretty stable, steady at this point. As far as we know, we are actually not seeing any inventory powered up in the channel itself. Q – Mari Hoshini: Okay, understood. And then going back to the question that was asked earlier regarding incremental dollars of Test CapEx is that serve to assume that test equivalent ASP has come down significantly compared to 2004, therefore, you should be getting more number of Testers for the same dollar of Test CapEx? A – Freddie Liu: Very tough, first, numbers of testers, yes, I think that is right, because Test time took a longer these days, so it is no necessary get higher conflict. Q – Mari Hoshini: I understood, if so … A – Freddie Liu: For a Tester price size come down, so if you comment is correct. Q – Mari Hoshini: Yes, yes, for same dollar of Test CapEx, you are getting more Testers from your vendors primarily because to the seculars trend of lower Test, Test equivalent ASP. A – Freddie Liu: Yeah, and?

I think he is more dollar for, more performance out of the dollar disk. Q – Mari Hoshini: Yeah, understood thank you.

Thank you.

Thank you, sir. Our next question is coming from Sir Franklin. Please go ahead, thank you.

Hi, good evening Joseph, my first question is can you may be share with us in terms of – may be the capital intensity or incremental efficiency improvement for heavy dollar of such a investment you have, may be on the margin side or revenue side? A – Freddie Liu: On the asset of PBGA is more like a dollar-to-dollar kind of ratio. Is that question?

For the substrate investment? A – Freddie Liu: Yes.

In other words, every dollar you continue to get one dollar of revenue?

Yes.

How about for the internal sourcing and how would that help your margin in terms of your substrate investments?

Well first we have in to – our substrate operation has seen very significant improvement, as you can see the gross margin on the substrate that we billed, came up about 6% in quarter three to about 25% in quarter four, and that expanded margin along with the increase of a self-supply ratio will certainly be blended into our overall margin, for improvement.

Right, as you are increasing your internal self-sufficiency ratio, does that mean by the end of the year on absolute term, your outsourcing of substrate would be down? A – Freddie Liu: The percentage of our sourcing will certainly be down and depends on the overall volume that we are doing for the year – the absolute amount could change as well.

Right, in terms of, since there are two substrate would you be expanding into that area? A – Freddie Liu: Well, I don’t think this going to be on priority. I think with our internal substrate ramp up, our internal demand would be given preference, given priority. Because it will do help our pricing part of our business. So we do not allow the possibility of supplying, some of the substrate with the DSO maker.

Okay, thank you.

Thank you, sir for your question. Our next question is coming from Mr. K.H. Chung (phonetics) from Taiwan. Please go ahead. Q – Chung: My question has been answered, thank you.

Thank you, sir. And our next question is coming from Andrew Tai (phonetics) from the UK. Please go ahead.

Thank you. I just wanted to get a feel from you on the potential for further overall gross margin improvement, because I saw you’ve been surprised by your Q1 guidance, the gross margin seem to be vary resilient. And I just wondering whether that was because you had achieved lot of your efficiency agreement to head a schedule, whether you felt that there were, in addition to increase in self efficiency ratio for substrate, so there was more realm on yield and improvement there, to would actually drive our overall gross margin by the end of the year? A – Freddie Liu: Yes, I think there is still further room for improvement in our margin, I think we will continue to look at, well of first of all, that the higher the self-supply ratio we have on substrate, the better the margins we will get. As far as we have a profitable Material Operation, so at the current time we only supplying 35% of our own substrate, as we continue to raise that ratio, of course there is going to be further contribution to the overall margin. We are continuously keeping our CapEx under very tight control aiming at continuously bringing down depreciation expense as the percentage of our revenue, so we came up. I have some margin improvement from that end as well, and we are also looking very aggressively on managing our operating expenses, which has been lower in terms of potential sales consequently on that part I think my goal, our goal is to bring it down to from currently over 9% to above 7.5 % to 8% by the year end. So, we will be attacking our cost from all fronts and try to further expand our margin. Bear in mind, we, right now the Assembly Margin that we have the gross margin is at 21% and the Test Margin is 40% at this point. But if you look at our historical peak, we have 25% for Assembly Margin and over 45% with Test Margin and we are certainly moving very aggressively toward reaching that historical level by the margin.

Is that something you feel is within your grasp within this year? A – Freddie Liu: We certainly try very hard to reach that.

Right, what would be you gave us sort of the revenue generation ratio as a dollar Test CapEx? What it is for Assembly? A – Freddie Liu: Each dollar on investment can generate $1.00 or $1.60 of revenue.

Right, and what is the overall 2005, self-sufficiency rates here, 35 or that was just for the fourth quarter for substrate? A – Freddie Liu: As the fourth quarter, the overall I think, roughly 30%.

Right and just on the Test side, do you, are you able to show us just what the operating margin was there? Sure I look if the substrate in a work portion of the operating expenses which allocated to that side?

Proportion for what?

The operating expenses, you just gave gross margin?

We have over 40% gross margin of about 30% of the operating margin.

Got it, and I just wanted to finish by asking about the chipset issue, I think what people are concerned about the absence of Intel from the lower end desktop chipset market is a created a bit of feast for the third party chipset suppliers and whether this is going to come to an end and then you partly address by saying a new adjustment appears to be normal. I was wondering if you looked at that issue with the sort of expected return of some point of in this market, in some fashion would basically just reduce the pie of these people have been feeding on, whether that was going to be an issue for your Q2, Q3 at some point?

Well I think there is always some market share movements among every factor, I think what we need to do is try to expand our customer base as much as possibility to include all the major players in particular sectors, so that we can mitigate our risk of fluctuation.

Okay. Thank you.

Thank you.

Thank you sir. Our question is coming from Hong Sheng (phonetics) from Taiwan, please go ahead.

Hi, Could you give some about gross margin for material operation in Q1 or may be even Q2? A – Freddie Liu: I think we had a very, very significant jump from 6% to 25% and in Q1 or in Q2, I think we will look very hard to maintain at that level.

Okay thanks. A – Freddie Liu: Thank you.

Thank you, Mr Shag that concludes your question. Thank you, our next question it is coming from David Wu from the U.S, please go ahead.

Yes good morning. Can you answer, two questions for you, can talk a little bit of your communications customers you have fairly large handset guys like Freescale and Qualcomm in the top ten, a typically dip in Q1 and it sounded like relative to the chipset. The chipset people they are going do better, are they indicating that business will be flat and then I had also got a bunch of communication related chip, wafers companies in the U.S. who are complaining about tightness in backend assembly and test supply and I was wondering with the dip in Q1 why would they still be saying that?

Actually in the communication factor from our operation we don’t have to see this. As a information the revenue reduction that we see in 1st quarter is for around high single digits but off that drop about 2% to 3% of the drop was due to a currency fluctuation particularly the NT appreciation and so if we net that out whatever the revenue drop that we were seeing in quarter 4 was actually resulted from last working day that we have that quarter. If you look at the daily loading that we have, it is actually stayed clearly flat from fourth quarter.

So in and since if you have a dip in your PC chips at guys there must be an increase in the consumer communication segment. Is that said what you are trying to say?

I was saying that relatively speaking the PC sector seems to be performing along with the season pattern, whereas communication and consumers seems too stronger than the normal seasonal pattern.

For the first quarter that we have this time around is actually a stronger first quarter than the fourth quarter? So that help us some may have felt pretty optimistic about the full year.

Got It, I see what you are saying. The complain out here is that the flip chip, it’s capacity is very tight, how is flip chip doing at your side?

Actually the loading of flip chip is not yet fully loaded from our side rather the standard PBGA allowed actually some of the legacy outages fluctuate in full capacity.

Oh! I see. Okay thank you.

Thank you.

Thank you sir for your questions. Our next question is coming from Theodore Teo from Hong Kong. Please go ahead. Q – Theodore Teo: I just want to ask on test. Is it still accurate to judge the incremental increase in testing revenues from your CapEx, given that you have increased the component leasing and the consignment you are talking about so if not then how are we supposed to understand test revenue growth going forward from here?

Well I wont think we want to be still hung up on the CapEx number we have, as we mentioned before, what we have budgeted here is based on the business trend that we have and the forecast that we are getting from our customers at this very moment, now it will be a dynamic kind of process as we continue to watch very closely on what kind of forecast that we are getting, what kind of the deposits are we getting from our customer and then the CapEx number will be adjusted accordingly. Q – Theodore Teo: But is it fair to say that the, because there is the element of using and consigning the $50 million CapEx proprietarily reflect the increase in test revenue space from this ASE.

We would certainly try to get as many, as much consignment as possible, so in that regard I think your assessment to be correct. Q – Theodore Teo: Thanks and one question on wafer sorting, the percentage of wafer sorting increased on the quarter I am just wondering how what is the ongoing trend regards to wafer sort, given ASEs strategy as a whole in terms of wafer sort.

Well not looking too far out, I think atleast in quarter 1 and may be into quarter 2 we are seeing pretty stable wafer sort business in terms of volume. Q – Theodore Teo: Thank you.

Thank you,

Thank you, sir our next questions is coming Pramodh Sharma, from Hong Kong. Please go ahead. Q – Pramodh Sharma: Thank you congratulations Joseph, I have a couple of questions, first one is on with this $200 million CapEx for the substrate, what will be the capacity by end of the year?

We are looking at about 60 million units by end of the year, and we are planning on installing about $2 million unit capacity for flip chip substrate. Q – Pramodh Sharma: And on the same business currently say are, you have reached already 25% margin and you are saying that you will be a probably at the same level on the first half of ‘06. What is the maximum margin you can reach on this particular business because this is a new business for you and what you think that maximum margin could be high?

Well, If it is varying reference, there are competitor of our in the same field, getting over 35% margin gross margin. Q – Pramodh Sharma: So, your target will be probably to reach that type of margins on good times.

Well, it is always nice to have a target to exceed your competitor. Q – Pramodh Sharma: Okay and only a wafer insight, could you give us like how many percentage of wafers is coming from the 90 nanometer type of wafer now and in 65 nanometer do you have any problem on the processing or something?

I am sorry I don’t have that information. Q – Pramodh Sharma: Then on segmental outlook for first half of ‘06, could you give us some product categories like where you have seen some strength or where you have seen some weakness, you have given the communications in the consumer is better in the seasonal pattern, what do you think that from productwise?

Well as far as we are concerned we have very actually very little exposure in the wireline business, so most of our communication sector business are in the handset area and we are seeing fairly strong momentum in both GSM 2.5 GS as well as 3G. We actually have from our own portfolio we see even stronger momentum in the wireline part of it, but as I said we have very little exposure at that so, whatever we having it is not very representative of the whole industry. Q – Pramodh Sharma: And then on consumer side you strength is mainly coming from in games console or any other product as well?

I think it is game console and flat panel TV. Q – Pramodh Sharma: Okay the CapEx in 2006 would it be on the frontend loaded like that or it will be evenly spread, any color on that?

CapEx? I think for the material, it could be fairly evenly spreaded, but for assembly and test it will be backend loaded.1 Q – Pramodh Sharma: Okay, thank you very much

Thank you

Thank you, sir. Our next question is coming from Sambark Bachman (phonetics) from the US, pleased go ahead.

Hi good evenings Joseph. Its been several years since you have actually seen margin approach about 40% in your test business, can you talk a little bit more about your testing gross margin improvement and may speak little more in depthly about the drivers behind that?

Well, I think we do have some room to improve our efficiency. At the same time, also, we are trying to reach an agreement with our customer, generally, the risk of investing our capital, test, would be a lower than, the business, borrowing time it has. And then because of the timing of the fund passing, I think we are able to maintain our ASP. So, basically, I think the test market can still be the victim. I think in the past what we have seen is the CapEx, I think the victim whereas the ASPs continues to grow, at this time around, because we are controlling our CapEx. So our depreciation expense would be within a very reasonable level, that’s entirely still be flat. So I think, again, Q4 has been a benchmark for the Company.

Okay, so for example, my question is then is, do you think you might be able to get one another 300 to 500 basis points on your testing side?

Yeah.

Okay. And then how do you see gross margin trending here in Q1 on the test?

I think Q1 will be very similar to Q4. It’s now boosting us very, very slightly. I think as a whole, we are looking at about 1 to 2% growth in a gross margin level Q1 because of the reduced revenue.

Okay. Can you talk a little bit about the margin difference between ASE and ASE Test, just for your testing business, are they pretty comparable right now?

Call me tomorrow.

Okay. How about the in general terms on the packaging side, can you, if I do the math right, I think your packaging gross margin at ASE around, say 20% or so and on ASE test I believe that they are still in the low single digit, can you explain the difference between those right now, why the vast difference?

I think the biggest difference is really from the loading.

Okay, the loading at ASE versus ASE Test.

Yeah.

Okay. And then finally in terms of seasonality, how do you see Q1 revenues trending for the month of January, February, and March?

Well, February will be the lowest month, of course because these are less working days. And then it will rebound a bit 18 in March to be very similar that with the January.

Okay, so turning now February, March, January, excellent, may be just one more, could you just talk about lead times real quickly here from order to delivery, how long are they taking it, and how does that compare to so called normalized lead times.

I don’t think. I don’t see real any changes in lead times except for the equipment delivery.

Okay, thank you very much.

Thank you

Our next question is coming from Sharon Quigley (phonetics) from the US, please go ahead. Hello sir, please go ahead with your question, thank you. Sir, Sharon Quigley just cancelled question. And we have follow-up question from Mari Hoshini from the US, please go ahead.

Yes, Going back to your commentary regarding test gross margin, and how it is been improving especially with in very diligent in terms of adding capacity, what is the difference this time compared to past couple of year that has neither possible for you to keep your capacity addition at the minimum is that your competitors inability to comment and lower prices or is that finally that consensus among your peer group that is dropping ASE for gaining incremental revenue is not going to be a viable solution, and then my second follow up has to do with your profit sharing, any guidance on what the profit sharing for ASE and ASE Test is going to be in 2006?

Profit sharing?

Yes.

At what sense?

Well, you have been historically, you gave a percentage of your revenue in terms of profit sharing or dividend to employees. Any guidance on how it is going to look like in 2006?

There is no comments regarding that. Volume of rebate on the profit contribution side?

Right. But for modeling purposes how should we think about it?

Well, I don’t think you need to model it this year, here because we had lost last year?

Okay, Okay

So there is no staff bonus. And the terms of the I think the test margin, is a combination of many different factors, one the better discipline in the sector is really one of the important factors, After the last counter, all the major players in the field are getting more cautious and expanding the capacity to gain market share, and try to safe guard value, the pricing and we haven’t seen anything, you know contrary to that at this point but also from our own effort I think many different areas that we are looked at and reviewed and tried to act on it, one being that we continue to find ways to improve the OEE of our competitors. Loading is one factor that we looked at but OEE is also a very, very important factor, OEE meaning that the actual utilization, the use time of our testers. So we are, we certainly seeing a lot of efficiency improvement on that, and also as I mentioned before, we used to provide a lot of services for free, particularly some of the engineering test that we do, some of the small orders that we are under take, hoping that those business will eventually turn into mass production. But we are not, we are no longer providing that for free either for the one that we do have the charge on we raise our prices on that, So all in all we want increase the chargeable hours on the particular tester and also the ASP on the chargeable hours as well at the same time so those are the reasons where we can achieve a much better margin now and going forward I think we will continue to work on all these areas trying to continuously improve our margin on test business as well.

Thank you.

Thank you.

Thanks Sir, our next question is coming from Andrew Tai, from the UK, please go ahead, Q – Andrew Tai: Can you tell me what the depreciation charge will be, mechanically this year?

Mechanically? Q – Andrew Tai: Well mechanically, just your result of whatever CapEx you put in I was just wondering if there are any changes or drop offs in depreciations as a results of ending appreciable lives of any existing capacity that, I was wondering what the depreciation charge would be this year?

I think the depreciation will be very flat this year, compared to, you know, from last year, last quarter. Q – Andrew Tai: Right intelligence.

That’s in terms of percentage? Q – Andrew Tai: I am sorry?

In terms of absolute amount. Q – Andrew Tai: Absolute dollars, yeah, okay, so flat on a quarterly basis at the Q4 ‘05 level?

Yeah. Q – Andrew Tai: Okay and then you mentioned that you were looking ASE Test tomorrow but are you in a position to just strip out the portion of test and packaging attributable to the separate listed test company as opposed to the parent in the last quarter.

I am sorry I didn’t get your question. Q – Andrew Tai: I mean that the part that test activity that you do within parent as opposed to the test company and or any split on the packaging side, are you able to just save of the breakdown between test packaging and modules say that you gave for the whole company, whether you can talk about how much is actually coming from ASE Test result?

All the test business, yeah we certainly have the numbers but…

Thank you Tai, you may go on with your question. Q – Andrew Tai: That completes my question, I don’t know whether, is there an answer for that one?

Hey, Andrew? Q – Andrew Tai: Yeah.

Freddie here. Q – Andrew Tai: I think testing 20% of the -- 60% to 70% of our testing revenue coming from ASE Test. And very little actual revenues from the company, that is totally at about $5 to $6 US dollars a month. Q – Andrew Tai: Thank you very much.

No more questions Andrew? Q – Andrew Tai: That is it. Thank you very much Freddie.

Thank you sir. Our next question is coming form Pramodh Sharma from Hong Kong. Please go ahead. Q – Pramodh Sharma: I have a follow up question on pricing trends, I guess a couple of quarters back, you started having little bit of pricing power, with that, going forward do you think you’re your pricing power on the assembly side still remain or it has come down a bit?

Well, I think ASP for first and second quarter, think we can give it a stable level, I think we are pretty much done with the pricing adjustment across the, our customers, where now we are maintaining and the pricing environment at this time is pretty stable. Q – Pramodh Sharma: Recently we have seen like gold price have gone up quite sharply, are you able to pass down the cost of the gold down to your customer or it remains, you have to absorb that amount?

You mean gold wire? Q – Pramodh Sharma: Gold wire Yeah.

Yeah, I think we are absorbing most of the talking thing. Q – Pramodh Sharma: And for modeling purposes what is the tax rate you are guiding for the 2006?

10 % Q – Pramodh Sharma: Sorry?

10%. Q – Pramodh Sharma: And any update for China related investments, I think when do you think China government is going to allow that and if they allow what will be your plan?

That’s a million dollar question and I don’t have any reading at this point, but I think in terms of China we do have all the infrastructure ready, we have the land and even the building there, as soon as the government gives us the go ahead we can put the, install the equipment and the capacity there. Q – Pramodh Sharma: It is safe to say that within six months time you can start production in china once you get a go ahead.

Even sooner than that. Q – Pramodh Sharma: Thank you very much.

Thank you.

Thank you sir, we have a follow up question from Andrew Dicks from the US. Please go ahead.

Yeah. Thanks, one quick follow-up, what was your net operating cash flow for Q4, and then one other question, I know you mentioned to Mark that lead times were pretty sooner than normal, could you tell us what those are from a time that a customer typically orders to drop share for delivery, thanks.

You mean, interest margin.

Yeah, do you have a net number with any kind of non-cash charges or anything that you could access and that I could look at the numbers in GAAP, I just was wondering that if you had released a more exact number for net operating cash flow. If you don’t have any idea I can get it from you later.

Yeah. let me get back to you on that.

Okay thanks. And then on the lead-time question, what are those normal lead times in your opinion?

From---?

From the time the customer would come in with a formal order to delivery?

If its manufacturing cycle package, about a week to ten days. Did I answer your question?

You can actually turn you know you could turn that quickly for a customer, right now?

For manufacturing, yes.

Okay. Thanks

Thank you.

Okay. Thank you very much for attending our conference call and this summit. I think we have a very good quarter in quarter 4, and going into 2006 we remain very optimistic about the year, particularly looking at quarter 1, it is stronger than normal first quarter, and that gives us more confident for the whole year. We will continue to maintain our strategy, a profit driven one, rather than a market share driven one, and we will continue to work on our margin, while we believe there is still room for improvement, and hopefully we can successfully execute our strategy going forward, and also on the finance side we will continue to maintain positive free cash flow and continue to improve our financial standing, we are confident that we will have another successful year in 2006. Thank you very much for attending the conference call, and this session will have a replay time of eight days. All right, thank you very much and Happy New Year.

Thank you and that concludes today’s conference call, all lines may disconnect now, and good day to you all. Thank you.

Thank you.