Financial Performance - Hua Hong Semiconductor achieved record annual revenue of US$1,630.8 million in 2021, representing a 69.6% increase compared to 2020[20] - The gross margin for the year was 27.7%, an increase of 3.3 percentage points from the previous year, despite rising raw material costs[20] - Profit attributable to owners of the parent reached US$261.5 million, marking a 162.9% increase year-on-year[20] - The return on equity improved to 9.7%, reflecting a year-on-year increase of 5.5 percentage points[20] - The company reported a significant increase in revenue, achieving a total of $1.2 billion for the fiscal year 2021, representing a year-over-year growth of 25%[59] - Revenue reached an all-time high of US$1,630.8 million, representing a 69.6% increase year-over-year, driven by increased wafer shipments and improved average selling prices[141] - Gross profit increased to US$451.6 million, up 92.3% from 2020, primarily due to improved average selling prices, capacity utilization, and product mix[143] - Profit for the year increased significantly to US$231.0 million from US$33.3 million in 2020, resulting in a net profit margin of 14.2% compared to 3.5% in 2020[151] Production and Capacity - Hua Hong Wuxi's 12-inch production line maintained a utilization rate of over 100%, with wafer-starts exceeding 65,000 per month since October 2021[21] - The company is migrating its technology platforms from 8-inch to 12-inch, enhancing capabilities in Embedded Non-Volatile Memory and Power Device production[21] - The Company aims to expand its 12-inch production line capacity to over 90,000 wafers per month by the end of 2022[24] - The company accelerated capacity expansion for 300 mm production in 2021 to meet strong market demand[117] - The 12-inch production capacity at Hua Hong Wuxi is set to expand, supporting the company's strategy to meet increasing market demand[137] Market and Revenue Segmentation - Revenue from semiconductor wafers accounted for 95.8% of total revenue, amounting to US$1,561.8 million, which represents a 68.5% increase year-on-year[119] - Revenue from systems and fabless companies was US$1,496.8 million, making up 91.8% of total revenue, with an 83.8% year-on-year increase[120] - The largest market for the company was China, generating US$1,205.1 million in revenue, a 93.0% increase year-on-year[121] - eNVM technology revenue grew to US$459.1 million, representing a 37.2% increase year-on-year[122] - Revenue from Logic & RF technology platforms surged by 117.7%, primarily due to the mass production of 12-inch CMOS image sensor products[122] - The company’s revenue from the Consumer Electronics market was US$1,039.3 million, accounting for 63.7% of total revenue, with a year-over-year growth of 74.9%[125] Research and Development - Investment in R&D increased by 30% to $150 million, focusing on advancements in semiconductor technology and new product development[62] - The Company has applied for a total of 6,593 patents in China, obtaining 3,575 domestic and 147 international patents as of the end of 2021[22] - The Company launched the NORD-Flash memory cell, which significantly reduces cell area and won the "2021 Excellent (Technology) Solution Award for Highly Reliable Microcontrollers (MCU)"[23] - The company applied for 618 patents in 2021, bringing its total to over 3,800 granted patents, reflecting its commitment to innovation and technology development[134] Strategic Initiatives - The company is accelerating capacity expansion to address the global chip shortage and sustain growth into 2022[19] - The Company plans to enhance its "8 inch + 12 inch" strategy by increasing R&D investment and developing narrower technology nodes[24] - The Company is focused on creating leading "Advanced Power Discrete" capabilities through innovative device structures and establishing automotive grade processes[24] - A strategic acquisition of a smaller semiconductor firm was completed, valued at $200 million, aimed at enhancing technological capabilities and product offerings[64] - The company plans to expand its market presence in Europe and North America, targeting a 10% market share increase in these regions by 2023[63] Operational Efficiency - Wafer shipments (8-inch wafer equivalent) increased by 51.9% year-over-year, totaling 3,328 thousand wafers in 2021[128] - Capacity utilization for 8-inch wafer equivalent reached 107.5%, up from 92.7% in 2020, indicating strong operational efficiency[127] - Selling and distribution expenses rose by 30.7% to US$10.7 million, mainly due to increased labor expenses[145] - Administrative expenses decreased by 23.8% to US$198.9 million, largely due to reduced research and development expenses[146] Future Outlook - The Company anticipates that 2022 will be a year of accelerated growth and high-quality development[24] - The company provided a positive outlook for 2022, projecting a revenue growth of 20% to $1.44 billion, driven by new product launches and market expansion efforts[61] - The company anticipates a robust performance in 2022, driven by strong global demand for semiconductor components despite expected supply constraints[136] Corporate Governance - The Company held five Board meetings during the year ended 31 December 2021, with all members present at the Audit Committee meetings[90] - The remuneration paid to auditors for audit services was US$0.68 million, and for non-audit services, it was US$0.08 million[87] - The Nomination Committee achieved measurable objectives for board diversity to a large extent, focusing on cultural and educational backgrounds, professional experience, and skills[94] - All Independent Non-Executive Directors confirmed their independence in accordance with the Listing Rules[71] - The Company maintains a website with updates on business developments, corporate governance practices, and shareholder rights[97] - The Board is satisfied that each Director spends sufficient time performing their responsibilities[76] - The Company encourages Shareholders to attend general meetings to enhance accountability and communication regarding strategy and goals[101]
华虹半导体(01347) - 2021 - 年度财报