Ichor (ICHR)2023-02-24 14:21Financial Performance - Revenue for 2022 was 1,096.9 million in 2021, representing a growth of approximately 16.7%[19] - Net income for 2022 was 70.9 million in 2021, reflecting a growth of about 2.7%[19] - Total capital expenditures in 2022 were 20.8 million (1.9% of sales) in 2021[24] Market Position and Strategy - The company aims to grow its market share within existing customers by leveraging specialized engineering talent and early collaboration, targeting a broader range of process tools[25] - The acquisition of IMG Companies in November 2021 expanded the company's product offerings and customer base, including entry into medical and aerospace sectors[27] - The company has established long-standing relationships with top-tier customers, including Lam Research, Applied Materials, and ASML, which are critical for competitive positioning[22] - The semiconductor capital equipment market is cyclical, and the company has structured its business to minimize fixed costs, allowing for growth in net income at a higher rate than sales during growth periods[24] - The company is actively engaging with new customers in various sectors, including those considering outsourcing their gas and chemical delivery needs[28] - The semiconductor equipment market is highly concentrated, with five companies accounting for over 70% of all process tool revenues[37] - In 2022, the two largest customers, Lam Research and Applied Materials, accounted for a combined 79% of sales[37] Innovation and Development - As of December 30, 2022, the engineering team consisted of approximately 90 engineers and designers, enhancing the company's product development capabilities[46] - The company has established an ESG council to support sustainable practices and community involvement, with a five-year roadmap initiated in 2022[58] - As of December 30, 2022, the company had 59 granted patents and 67 pending patent applications, indicating a strong focus on intellectual property[50] - The company is focused on improving manufacturing process efficiency to reduce cycle times and costs, enhancing profitability and product attractiveness[29] - The average order-to-delivery cycle time for manufacturing a gas delivery system can be as little as 20 to 30 days[40] Operations and Manufacturing - The company operates ISO 9001 certified manufacturing locations and adheres to strict design tolerances and specifications[41] - The company utilizes just-in-time stocking programs to manage component inventories and respond to changing customer requirements[44] - Approximately 2,280 full-time employees and 700 contract or temporary workers were employed as of December 30, 2022, supporting operational flexibility[53] Financial Management and Risks - Total indebtedness as of December 30, 2022, was 7.5 million payable within the next 12 months[209] - The interest rate on outstanding debt is based on the Bloomberg Short-Term Bank Yield Index, with a hypothetical 100 basis point change resulting in a $3.0 million change to annual interest expense[209] - The company does not expect foreign currency exchange rate fluctuations to materially affect its results, as most sales and supplier arrangements are in U.S. dollars[207] - Operating expenses may be subject to fluctuations due to foreign currency exchange rates, particularly in currencies such as the Singapore dollar and euro[208] - The company has not engaged in foreign currency hedging transactions, and foreign currency transaction gains and losses have not been material to financial statements[208] - The company has not used derivative financial instruments to manage interest rate risk exposure[209] Compliance and Environmental - The company believes it operates in substantial compliance with environmental regulations, but future compliance costs could be significant[206] - There are no known environmental investigations, lawsuits, or claims against the company at this time[206] Investor Relations - The company maintains a variety of information available on its Investor Relations website, including annual and quarterly reports[60] - The SEC maintains a site with reports and information regarding issuers that file documents electronically[61]