中芯国际(00981) - 2024 Q2 - 季度业绩

Performance Overview This section provides a comprehensive summary of SMIC's Q2 2024 financial performance, Q3 guidance, and management's strategic outlook Key Financial Highlights for Q2 2024 SMIC reported unaudited Q2 2024 results, showing sequential growth in revenue and gross profit, but a year-over-year decline in gross margin | Metric | Q2 2024 (million USD) | Q1 2024 (million USD) | Q2 2023 (million USD) | | :--- | :--- | :--- | :--- | | Sales Revenue | 1,901.3 | 1,750.2 | 1,560.4 | | Gross Profit | 265.1 | 239.7 | 316.5 | | Gross Margin | 13.9% | 13.7% | 20.3% | Q3 2024 Performance Guidance The company anticipates sequential revenue growth and an improved gross margin for the third quarter of 2024 - The company estimates sequential quarterly revenue growth of 13% to 15%[2] - Gross margin is expected to be in the range of 18% to 20%[2] Management Commentary Management noted Q2 performance exceeded guidance, emphasizing the company's continued focus on wafer manufacturing and strategic future planning - The company's Q2 sales revenue was $1.9 billion, a sequential increase of 9%, exceeding guidance[3] - Shipments exceeded 2.11 million 8-inch wafer equivalents, a sequential increase of 18%[3] - Average selling price decreased by 8% sequentially due to changes in product mix[3] - The company will continue to deeply cultivate wafer manufacturing, arranging its current layout from a future perspective, embracing both opportunities and challenges[3] Conference Call / Webcast Details Details for the Q2 2024 earnings conference call and webcast on August 9, 2024, including registration and replay information, are provided - Conference call/webcast date: Friday, August 9, 2024, 8:30 AM - 9:30 AM[4] - Online webcast and conference call registration links are provided[4] - Replay will be available on the official website for 12 months approximately one hour after the conference[4] Company Information This section details SMIC's position as a leading global foundry and includes important disclaimers regarding forward-looking statements and associated risks About SMIC SMIC is a leading global integrated circuit foundry and China's largest, offering 8-inch and 12-inch wafer foundry services with manufacturing and marketing bases worldwide - SMIC is one of the world's leading integrated circuit wafer foundries and the leader in integrated circuit manufacturing in mainland China[5] - The company possesses leading process manufacturing capabilities, capacity advantages, and comprehensive services, providing 8-inch and 12-inch wafer foundry and technical services to global customers[5] - Headquartered in Shanghai, China, with multiple 8-inch and 12-inch wafer fabs in Shanghai, Beijing, Tianjin, and Shenzhen, and marketing offices in the United States, Europe, Japan, and Taiwan, China[5] Forward-Looking Statements This announcement contains forward-looking statements based on current expectations, subject to significant known and unknown risks in the semiconductor industry and geopolitical factors - This announcement may contain forward-looking statements made based on SMIC's current assumptions, expectations, beliefs, plans, objectives, and forecasts regarding future events or performance[6] - There are significant known and unknown risks, uncertainties, and other factors that could cause SMIC's actual results, financial condition, or operating results to differ materially from those contained in the forward-looking statements[6] - Risk factors include semiconductor industry cycles and market conditions, intense competition, introduction of new technologies, mass production capabilities, shortages of equipment/spare parts/raw materials/software/service support, intellectual property litigation, macroeconomic conditions, currency exchange rate fluctuations, and geopolitical risks[6] Operating Performance Analysis This section presents a detailed breakdown of SMIC's Q2 2024 operating results, including revenue, capacity, shipments, utilization, and capital expenditures Q2 2024 Operating Performance Summary Key operating results for Q2 2024 are detailed, including revenue, gross profit, operating profit, net profit, gross margin, EPS, wafer shipments, and utilization rates | Metric (thousand USD) | Q2 2024 | Q1 2024 | QoQ Change | Q2 2023 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 1,901,276 | 1,750,176 | 8.6% | 1,560,396 | 21.8% | | Gross Profit | 265,093 | 239,704 | 10.6% | 316,500 | -16.2% | | Operating Profit | 87,140 | 2,406 | 3,521.8% | 79,798 | 9.2% | | Profit for the Period | 172,262 | 63,515 | 171.2% | 464,171 | -62.9% | | Gross Margin | 13.9% | 13.7% | | 20.3% | | | Earnings Per Share (Basic) | $0.02 | $0.01 | | $0.05 | | | Wafer Shipments (8-inch wafer equivalents) | 2,111,880 | 1,794,891 | 17.7% | 1,403,121 | 50.5% | | Capacity Utilization Rate | 85.2% | 80.8% | | 78.3% | | - The increase in sales revenue was primarily due to higher wafer shipments in Q2 2024[8] Revenue Analysis A detailed breakdown of Q2 2024 revenue by region, service type, wafer application, and wafer size highlights China and consumer electronics as key contributors, with 12-inch wafers dominating Revenue by Region | Region | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | China | 80.3% | 81.6% | 79.6% | | United States | 16.0% | 14.9% | 17.6% | | Eurasia | 3.7% | 3.5% | 2.8% | Revenue by Service Type | Service Type | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Wafer | 92.9% | 93.0% | 90.5% | | Other | 7.1% | 7.0% | 9.5% | Wafer Revenue by Application | Application | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Smartphones | 32.0% | 31.2% | 26.8% | | Computers & Tablets | 13.3% | 17.5% | 23.8% | | Consumer Electronics | 35.6% | 30.9% | 26.5% | | Interconnected & Wearables | 11.0% | 13.2% | 11.9% | | Industrial & Automotive | 8.1% | 7.2% | 11.0% | Wafer Revenue by Size | Size | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | 8-inch Wafer | 26.4% | 24.4% | 25.3% | | 12-inch Wafer | 73.6% | 75.6% | 74.7% | Capacity, Shipments, and Utilization Rate Monthly capacity, wafer shipments, and capacity utilization rate all increased sequentially, indicating market demand recovery and improved production efficiency - Monthly capacity increased from 814,500 8-inch wafer equivalents in Q1 2024 to 837,000 8-inch wafer equivalents in Q2 2024[10] Shipments and Capacity Utilization Rate | Metric (8-inch wafer equivalents) | Q2 2024 | Q1 2024 | QoQ Change | Q2 2023 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Wafer Shipments | 2,111,880 | 1,794,891 | 17.7% | 1,403,121 | 50.5% | | Capacity Utilization Rate | 85.2% | 80.8% | | 78.3% | | Capital Expenditure Summary Q2 2024 capital expenditure remained stable at $2,251.5 million, reflecting ongoing investments in capacity expansion and technological upgrades - Capital expenditure for Q2 2024 was $2,251.5 million[12] - Capital expenditure for Q1 2024 was $2,235.4 million[12] Detailed Financial Analysis This section offers an in-depth examination of SMIC's Q2 2024 financial metrics, covering gross profit, operating expenses, other income, EBITDA, liquidity, and cash flow Gross Profit Analysis Q2 2024 gross profit increased 10.6% sequentially but decreased 16.2% year-over-year, with a gross margin of 13.9%, slightly up from the previous quarter | Metric (thousand USD) | Q2 2024 | Q1 2024 | QoQ Change | Q2 2023 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Cost of Sales | 1,636,183 | 1,510,472 | 8.3% | 1,243,896 | 31.5% | | Depreciation and Amortization | 701,547 | 630,824 | 11.2% | 526,817 | 33.2% | | Other Manufacturing Costs | 934,636 | 879,648 | 6.3% | 717,079 | 30.3% | | Gross Profit | 265,093 | 239,704 | 10.6% | 316,500 | -16.2% | | Gross Margin | 13.9% | 13.7% | | 20.3% | | Depreciation and Amortization Depreciation and amortization expenses for Q2 2024 were $797,166 thousand, up 6.9% sequentially and 21.4% year-over-year, reflecting continuous fixed asset investments | Metric (thousand USD) | Q2 2024 | Q1 2024 | QoQ Change | Q2 2023 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Depreciation and Amortization | 797,166 | 745,537 | 6.9% | 656,452 | 21.4% | Operating Expense Analysis Q2 2024 operating expenses decreased 25.0% sequentially, primarily due to a significant increase in other operating income, while general and administrative expenses rose due to new factory setup costs | Metric (thousand USD) | Q2 2024 | Q1 2024 | QoQ Change | Q2 2023 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Operating Expenses | 177,953 | 237,298 | -25.0% | 236,702 | -24.8% | | Research and Development Expenses | 180,748 | 188,110 | -3.9% | 177,633 | 1.8% | | General and Administrative Expenses | 160,630 | 116,378 | 38.0% | 106,436 | 50.9% | | Selling and Marketing Expenses | 9,737 | 9,043 | 7.7% | 9,307 | 4.6% | | Impairment Loss on Financial Assets, Net | (1,025) | 1,014 | Not Applicable | (414) | 147.6% | | Other Operating Income | (172,137) | (77,247) | 122.8% | (56,260) | 206.0% | - The increase in general and administrative expenses in Q2 2024 was primarily due to increased new factory setup costs[13] - The change in other operating income was mainly due to government funding recognized in the current quarter[14] Other Income, Net Other income, net, for Q2 2024 was $99,875 thousand, up 38.7% sequentially, mainly influenced by fair value changes in financial assets, with fluctuating interest income and share of associate profits | Metric (thousand USD) | Q2 2024 | Q1 2024 | QoQ Change | Q2 2023 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Other Income, Net | 99,875 | 72,007 | 38.7% | 415,946 | -76.0% | | Interest Income | 142,233 | 164,110 | -13.3% | 192,612 | -26.2% | | Finance Costs | (71,742) | (66,725) | 7.5% | (48,384) | 48.3% | | Exchange Gains | 4,933 | 4,178 | 18.1% | (4,744) | Not Applicable | | Other Gains/(Losses), Net | 7,287 | (4,886) | Not Applicable | 242,597 | -97.0% | | Share of Profits/(Losses) of Associates and Joint Ventures | 17,164 | (24,670) | Not Applicable | 33,865 | -49.3% | - The change in other gains/(losses), net, was primarily due to fair value changes in financial assets recognized as fair value through profit or loss[14] EBITDA Q2 2024 EBITDA was $1,055,923 thousand, a significant sequential increase of 19.1% but a 12.0% year-over-year decrease, with the EBITDA margin rising to 55.5% | Metric (thousand USD) | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Profit for the Period | 172,262 | 63,515 | 464,171 | | Finance Costs | 71,742 | 66,725 | 48,384 | | Depreciation and Amortization | 797,166 | 745,537 | 656,452 | | Income Tax Expense | 14,753 | 10,898 | 31,573 | | EBITDA | 1,055,923 | 886,675 | 1,200,580 | | Profit Margin | 9.1% | 3.6% | 29.7% | | EBITDA Margin | 55.5% | 50.7% | 76.9% | Liquidity Total current assets and liabilities decreased, cash and cash equivalents significantly reduced, and liquidity ratios declined but remained healthy | Metric (thousand USD) | Q2 2024 | Q1 2024 | | :--- | :--- | :--- | | Total Current Assets | 11,220,062 | 13,001,438 | | Total Current Liabilities | 7,539,539 | 8,144,558 | | Cash and Cash Equivalents | 3,694,277 | 5,348,718 | | Cash Ratio | 0.5 | 0.7 | | Quick Ratio | 1.1 | 1.3 | | Current Ratio | 1.5 | 1.6 | Cash and Interest-Bearing Debt As of Q2 2024, total cash and cash equivalents decreased, while interest-bearing debt slightly increased, shifting net debt from negative to positive and raising the net debt-to-equity ratio | Metric (thousand USD) | Q2 2024 | Q1 2024 | | :--- | :--- | :--- | | Total Cash and Cash Equivalents | 12,980,458 | 15,385,655 | | Total Interest-Bearing Debt | 10,433,250 | 10,318,871 | | Net Debt | (2,547,208) | (5,066,784) | | Interest-Bearing Debt to Equity Ratio | 33.7% | 33.5% | | Net Debt to Equity Ratio | -8.2% | -16.4% | Cash Flow Summary Net cash from operating activities significantly decreased in Q2 2024, while net cash used in investing activities increased, leading to a larger net decrease in cash and cash equivalents | Metric (thousand USD) | Q2 2024 | Q1 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | 19,275 | 470,022 | | Net Cash Used in Investing Activities | (1,637,666) | (1,328,356) | | Net Cash from Financing Activities | 46,379 | 44,174 | | Net Decrease in Cash and Cash Equivalents | (1,654,441) | (866,340) | Financial Statements This section contains the condensed consolidated statements of profit or loss, financial position, and cash flows for the second quarter of 2024 Condensed Consolidated Statements of Profit or Loss and Other Comprehensive Income Condensed consolidated statements of profit or loss and other comprehensive income for Q2 and Q1 2024 detail revenue, costs, gross profit, expenses, profit, and other comprehensive income items | Metric (thousand USD) | June 30, 2024 (Unaudited) | March 31, 2024 (Unaudited) | | :--- | :--- | :--- | | Revenue | 1,901,276 | 1,750,176 | | Gross Profit | 265,093 | 239,704 | | Operating Profit | 87,140 | 2,406 | | Profit for the Period | 172,262 | 63,515 | | Profit Attributable to Owners of the Company | 164,569 | 71,792 | | Total Comprehensive Income for the Period | 120,977 | (33,853) | Condensed Consolidated Statements of Financial Position Condensed consolidated statements of financial position as of June 30, 2024, and March 31, 2024, present the detailed composition of the company's assets, liabilities, and equity | Metric (thousand USD) | June 30, 2024 (Unaudited) | March 31, 2024 (Unaudited) | | :--- | :--- | :--- | | Total Assets | 47,351,767 | 48,168,813 | | Total Non-Current Assets | 36,131,705 | 35,167,375 | | Total Current Assets | 11,220,062 | 13,001,438 | | Total Equity | 30,969,673 | 30,827,016 | | Total Liabilities | 16,382,094 | 17,341,797 | | Total Current Liabilities | 7,539,539 | 8,144,558 | Condensed Consolidated Statements of Cash Flows Condensed consolidated statements of cash flows for Q2 and Q1 2024 detail cash flow from operating, investing, and financing activities | Metric (thousand USD) | June 30, 2024 (Unaudited) | March 31, 2024 (Unaudited) | | :--- | :--- | :--- | | Net Cash from Operating Activities | 19,275 | 470,022 | | Net Cash Used in Investing Activities | (1,637,666) | (1,328,356) | | Net Cash from Financing Activities | 46,379 | 44,174 | | Net Decrease in Cash and Cash Equivalents | (1,654,441) | (866,340) | | Cash and Cash Equivalents at End of Period | 3,694,277 | 5,348,718 | Corporate Governance This section lists the composition of SMIC's Board of Directors, including executive, non-executive, and independent non-executive members Board of Directors The list of SMIC's Board of Directors includes executive, non-executive, and independent non-executive directors - Executive Director: Liu Xunfeng[22] - Non-Executive Directors: Lu Guoqing, Chen Shanzhi, Yang Luming[22] - Independent Non-Executive Directors: Fan Renda, Liu Ming, Wu Hanming[22]