Staying Resilient Amid Economic Uncertainty 1H 2020 Group Profitability Improved Year-on-Year
Highlights
First Half of 2020
- Group revenue of US$991.6
million improved by 5.9% over the same period last year and decreased by 10.5% compared to the
second half of last year - Group net profit of HK$390.8
million increased 119.2% as compared with the first six-month period of last year; and decreased 12.0% compared to the second six-month period of last year - Group earnings per share of HK$0.95
for the first half of 2020 - Semiconductor Solutions Segment
revenue of US$473.3 million increased 16.6% over the first six-month period of
last year and decreased 4.5% compared to the second six-month period of last
year - Materials Segment revenue of
US$125.7 million improved 15.6% over the first six-month period of last year
and fell by 3.2% compared to the second half of last year - SMT Solutions Segment revenue
of US$392.6 million decreased 6.9% and 18.7% over the first six-month period and the
second six-month period of last year, respectively - 1H new Group order bookings of US$1.14 billion increased
7.4% and 19.0% over the first and second six-month periods of last year,
respectively - Group order backlog was US$ 799.9 million as of 30 June 2020
- 1H Book-to-Bill Ratio was 1.15
Second Quarter of 2020
- Group revenue of US$ 557.4
million increased 27.8 % and 19.5%
over the preceding quarter and the same period
last year,
respectively - Group net profit of HK$365.4
million increased 1,341.5% and 421.8% over the preceding quarter and the same
period last year, respectively - Group earnings per share of
HK$0.89 for the second quarter 2020 - Group operating profits of HK$495.8
million increased 241.1% and 95.8% over the preceding quarter and the same
period last year, respectively - Semiconductor Solutions Segment
revenue of US$279.0 million increased 43.0% and 33.8% over the preceding quarter
and over the same period last year, respectively - Materials Segment revenue of
US$ 74.2 million increased 43.2% and 28.2% over the preceding quarter
and over the same period last year, respectively - SMT Solutions Segment revenue
of US$204.2 million increased 8.0% and 2.2% over the preceding quarter and
the same period last year , respectively - Q2 new Group order bookings of US$ 472.0 million decreased 29.4% and 21.6% over the preceding
quarter and over the same
period last year, respectively. - Cash
and bank deposits of HK$3.59 billion as of 30 June 2020
ASM Pacific Technology Limited (“ASM PT ” / the “Group”) (Stock code: 0522) today announced
its interim results for the six months ended 30 June 2020. Despite challenging first half of 2020 with the
global economy going through a steep economic downturn triggered by the COVID-19
pandemic and the lockdowns instituted in multiple
countries , as well as
headwinds posed by the US-China trade tension, ASMPT had been resilient and was
able to achieve YoY growth in revenue and profit, with the help of factors
including 5G
infrastructure built up, localization of the China semiconductor supply chain and strong
position of the Group in Advanced Packaging.
ASMPT reported a revenue of US$991.6 million during first half this year
(2019 1H: US$927.3 million) . The Group’s consolidated profit after
taxation for the period was HK$390.8 million (2019 1H: HK$178.3 million). Basic earnings per share for the period amounted to HK$0.95 (2019 1H:
HK$0.44).
Group
bookings for the first half of the year amounted to US$1.14 billion,
representing an increase of 7.4% compared to the first half of last year (YoY).
The book-to-bill ratio for the first six months of this year came in at 1.15. The Group ended the first half with a Backlog
of US$799.9 million.
Mr. Robin Ng, Chief Executive Officer of ASM PT , said, ” We have navigated global macro-economic headwinds relatively well,
but with t he
COVID-19 pandemic and ongoing geopolitical tensions continuing to be
disruptive, uncertainties remain. One thing is clear — the rapid
transformation of global workforce and industry norms have added to overall trends that point toward a future increasingly in need of more
digital capabilities and features. These include: increased telecommuting use,
a huge thirst for high performance computing & data centres, 5G
infrastructure buildup, localization of China’s semiconductor supply chain, and
– across multiple industries – an increasingly wider and more complex range of
requirements for digitally-driven capabilities. I am pleased that ASMPT is very
well placed to help meet these burgeoning requirements . ”
ASMPT saw an
increase in revenue recorded from customers from the Mobility, Communications
and Information Technology segments. Optoelectronics and Power Management
segments also turned in a very strong revenue performance for the first half of
2020 versus the first half 2019. Last but not least,
Advanced Packaging also delivered excellent results for billing performance in
the first half of 2020 compared to the first half of 2019 .
In light of ongoing
economic headwinds , the Group had
undertaken a series of Group-wide initiatives to control cost including a Group-wide
salary freeze, tight headcount control and close monitoring on discretionary
spending. The Group’s solid balance sheet provides the foundation to withstand this
period of economic uncertainty and beyond .
Weathering
COVID-19 Effect
With
the outbreak of COVID-19 in early part of this year, the Group formed a Group
BCP (“Business Continuity Plan”) Committee to steer its global efforts in managing
the COVID-19 situation. The Committee’s efforts have ensured that the Group is in
compliance with local authorities’ guidelines and restrictions while helping at the same time, as a responsible corporate citizen,
the communities in which it operates fight the outbreak.
In
its principal manufacturing facilities in China, effectively 100% of employees have
returned to work after the lifting of various travel restrictions that had been
imposed since the extended Chinese New Year holiday period. The Group has
recovered a big portion of lost capacity in Q1 through productivity improvement
and working overtime.
By
the middle of May 2020, its Malaysia factory had returned to full production
workforce. The Singapore government gradually re-opened business from 2 June
2020 and its workforce in Singapore continued to be on the alert to the evolving situation . In both locations, production capacity has been restored to normal
levels. In countries in Europe and the USA where the Group has operations, there are various types of restrictions and stay-in-shelter orders . The Group managed to continue its
business operations through a combination of flexible work arrangements.
Segment Highlights
During the second
quarter of this year, billings of the Semiconductor Solutions Segment amounted
to US$279.0 million, representing increases of 43.0% and 33.8% for QoQ and YoY
respectively. Billings of the Semiconductor Solutions Segment for the first six
months of this year were US$473.3 million, representing an increase of 16.6%
against the same period a year ago.
The Q2 segment billings strong YoY
growth was underpinned by Advanced Packaging, Optoelectronics and IC/Discrete
segments. CIS had experienced YoY decline mainly due to the soft demand for
smartphones and also the high base compared to the previous year. The advanced
packaging deposition tools for RDL (redistribution layer) and copper build-up
applications from NEXX had delivered strong billings growth compared to the
same period last year. The on-going market ramp for the High Performance
Computing applications continue to drive the strong performance from NEXX.
Other than NEXX, the traditional wire bonders and die bonders delivered
relatively strong YoY Q2 revenue growth despite challenging business
environment.
New
order bookings for the Semiconductor Solutions Segment in the second quarter
were US$226.9 million. For the first six months
of this year, the Semiconductor Solutions Segment achieved new order bookings
of US$536.5 million, representing a significant increase of 14.2% comparing to
the same period last year. On the YoY basis, Q2 segment bookings saw a slight decrease of 8.1%,
despite the confluence of the pandemic and trade war dampening the overall
business sentiment.
The Semiconductor Solutions Segment
achieved gross margins of 42.9% and 42.2% during the second quarter and the
first half of this year, respectively, which represented improvements of 211 bps
and 219 bps YoY, respectively. The gross
margin for first half was driven mainly by higher volume effect, positive
results from our productivity drive, product mix and continuous cost reductions
in our manufacturing operations .
Over the first six months of this year, bookings of
the Materials Segment amounted to US$167.3 million. This was an improvement of 59.3%
against the corresponding period of last year. The first half bookings for
Materials Segment was a record. Billings of the Materials Segment for the
six-month period amounted to US$125.7 million, representing an increase of 15.6%
comparing to the same period a year ago.
The Materials Segment achieved gross margins of 16.9%
and 13.5% during the second quarter and the first half of this year,
respectively, representing improvements of 546 bps and 250 bps YoY respectively.
The gross margin improvement of Materials Segment was underpinned by higher volume effect and discontinuation
of the loss-making Molded Interconnect Substrate business in 2020.
During the six-month period, billings of the SMT
Solutions Segment were US$392.6 million, representing a decrease of 6.9% YoY. The Segment gross margins of 31.3% and 31.8% during the second
quarter and the first half of this year respectively were impacted by the
decline in revenue for Automotive and Industrial applications market and the relatively
larger China customer base that the Group served this year compared to last
year.
” The International
Monetary Fund revised their global full year 2020 growth projections downwards
during their June 2020 review, from -3.0% to -4.9%. For the second half of
2020, the threat of another wave of COVID-19 infections and continued fallout
from worsening US-China tensions will remain major concerns globally. We
anticipate revenue for Q3 2020 to be in the range of US$480 million to US$560
million which takes into account subdued demand for Automotive and weakness in
Eurozone demand.
Despite these
uncertainties, we expect continued demand from Chinese manufacturers to
localize their supply chains, accelerated deployment of 5G infrastructure and
good progress the Group is making on capturing new market opportunities such as
Advanced Packaging, Silicon Photonics, Industrial Internet of Things, mini and
micro LED solutions, Power semiconductors and Industry 4.0 solutions to help
deliver long term sustainable value to our shareholders . “ Mr. Ng concluded.
