Financial Performance - For the six months ended June 30, 2022, the company's revenue was $2,101 million, representing a 6.0% increase compared to $1,982 million in the same period of 2021[10]. - Gross profit for the same period was $350.8 million, a 31.0% increase from $267.8 million year-over-year[10]. - Operating profit surged to $119.9 million, reflecting a significant increase of 652.9% from $15.9 million in the prior year[10]. - Profit attributable to the company's owners reached $85.1 million, marking an 818.8% increase compared to $9.3 million in the same period last year[10]. - The gross margin improved to 16.7%, up from 13.5%, an increase of 3.2 percentage points[9]. - Revenue for the six months ended June 30, 2022, was $2,101,326 thousand, an increase of 6.0% compared to $1,982,056 thousand in the same period of 2021[51]. - Gross profit for the same period was $350,839 thousand, up from $267,776 thousand, reflecting a significant increase in profitability[51]. - Operating profit surged to $119,936 thousand, compared to $15,929 thousand in the prior year, indicating strong operational performance[51]. - Net profit for the period reached $85,486 thousand, a substantial increase from $7,880 thousand in the previous year[53]. - Basic earnings per share rose to 1.23 cents, compared to 0.14 cents in the same period last year, demonstrating improved shareholder value[51]. Revenue Sources - The smartphone component market remained the largest revenue source, with a 26.6% increase in revenue compared to the same period last year[14]. - Revenue from the smartphone segment increased by 26.6% to $613.8 million, driven by strong demand for high-end smartphones[19]. - Revenue from the networking infrastructure market decreased by 19.1% due to chip supply shortages[14]. - Revenue from the electric vehicle market increased by 12.3%, driven by rising demand for electric vehicles[14]. - Revenue from the electric vehicle segment increased by 12.3% to $72.0 million, reflecting growing demand in the market[20]. - The United States contributed $969,903 thousand to revenue, a 21.5% increase from $798,125 thousand in 2021[83]. - Customer A contributed $773,619 thousand, a substantial increase of 48.5% from $520,989 thousand in the previous year[85]. Expenses and Costs - Distribution costs and selling expenses decreased by 9.8% to $46 million, attributed to the sale of Linksys shares[24]. - Administrative expenses decreased by 11.0% from $91 million for the six months ended June 30, 2021, to $81 million for the same period in 2022, primarily due to the sale of Linksys equity[25]. - R&D expenses increased by 3.8% from $131 million for the six months ended June 30, 2021, to $136 million for the same period in 2022, mainly due to investments in 5G AIoT and wireless charger product development[26]. - The total cost of goods sold, including inventory impairment, was $1,213,514 thousand for the six months ended June 30, 2022, compared to $1,194,621 thousand in 2021, reflecting a slight increase[96]. - The company incurred a total tax expense of $22,095 thousand for the six months ended June 30, 2022, compared to $5,992 thousand in the same period of 2021, indicating a higher tax burden[98]. Cash Flow and Assets - Cash and cash equivalents increased from $769 million as of December 31, 2021, to $854 million as of June 30, 2022[31]. - Total assets as of June 30, 2022, were $4,833,138 thousand, down from $5,006,664 thousand at the end of 2021[54]. - Inventory increased from $982 million as of December 31, 2021, to $1,123 million as of June 30, 2022, primarily due to overall business expansion[36]. - Trade receivables decreased from $1,033 million as of December 31, 2021, to $780 million as of June 30, 2022, mainly due to seasonal factors in the business[37]. - Total liabilities decreased to $2,459,023 thousand from $2,611,081 thousand, reflecting improved financial health[55]. Strategic Focus and Future Outlook - The company plans to strategically focus on the electric vehicle market, anticipating strong demand from major customers[17]. - The company expects the smartphone market to remain a significant revenue contributor despite a projected decrease in shipments in the second half of 2022[17]. - The company aims to explore new applications for interconnect solutions and other products in the electric vehicle sector[17]. - The company will collaborate with brand companies to create new market opportunities in the smart home sector following the divestment of Linksys[17]. - The company plans to continue expanding its market presence, particularly in the semi-finished products sector, which is primarily produced in China and Vietnam[79]. - The company is considering strategic acquisitions to enhance its product offerings, with a budget of $300 million earmarked for potential deals[191]. Employee and Shareholder Information - The total employee benefits expenses for the six months ended June 30, 2022, amounted to $399 million, compared to $368 million for the same period in 2021[44]. - The company had approximately 52,988 employees as of June 30, 2022, a decrease from 57,527 employees as of December 31, 2021[44]. - The company did not declare any interim dividends for the six months ended June 30, 2022[46]. - The company has implemented stock incentive plans to attract and retain talent[44]. - The company is evaluating new stock incentive plans that comply with listing rules[44]. Financial Risk Management - The company has adopted a prudent foreign exchange hedging policy to mitigate foreign exchange risks[45]. - The company has no significant contingent liabilities or guarantees that could materially affect its financial condition as of June 30, 2022[41]. - The group maintains a cautious liquidity risk management strategy, ensuring sufficient cash and committed credit facilities to meet obligations[67]. - The group has a rolling forecast for liquidity needs to ensure sufficient cash is available to meet operational requirements[67]. Corporate Governance - The board of directors has adhered to the corporate governance code and principles applicable to the company, with no significant deviations reported[180]. - The audit committee, consisting of three independent non-executive directors, reviewed the unaudited interim financial information for the six months ended June 30, 2022[184]. - All directors confirmed compliance with the standard code of conduct regarding securities trading for the six months ended June 30, 2022[181].
FIT HON TENG(06088) - 2022 - 中期财报