ChipMOS(IMOS) - 2021 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company achieved a record full year revenue of NT$ 27.4 billion, representing a 19.1% increase in 2021 compared to 2020 [6] - Gross margin increased by 460 basis points to 26.5% in 2021 [6] - Net earnings reached NT$ 6.96 per share in 2021, a 113.5% increase from NT$ 3.26 in 2020 [6][18] - Q4 2021 revenue was NT$ 6,791 million, a decrease of 5.2% compared to Q3 2021 [14][15] - Q4 gross margin was 26.0%, down from 27.3% in Q3 2021 [15] Business Line Data and Key Metrics Changes - Assembly represented 27% of Q4 revenue, testing accounted for over 21%, and wafer bumping made up about 20% [8] - Memory products represented about 40% of total Q4 revenue, with a year-over-year increase of 2% [9] - Driver IC-related product revenue was about 49.5% of total Q4 revenue, up 15% in 2021 [11] - Total DDIC revenue increased by over 13% year-over-year, with COF revenue representing about 44% of total DDIC revenue for 2021 [12] Market Data and Key Metrics Changes - Revenue from automotive and industrial applications increased to 17.5% of Q4 revenue, growing around 80% in 2021 compared to 2020 [12] - DRAM revenue represented about 16% of total Q4 revenue, down 14.3% compared to Q3 2021 but up 2% year-over-year [9] - Flash revenue grew significantly by 33.6% in 2021, with NOR increasing more than 45% [10] Company Strategy and Development Direction - The company is strategically extending new DDIC high-end test capacity to meet strong demand, particularly from OLED and automotive applications [22] - The company plans to offset seasonality in Q1 with flat to slightly up segment revenue, expecting growth in DRAM and NAND [22] - The Board approved a dividend of NT$ 4.3 per common share, reflecting the company's focus on building shareholder value [23] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for Q1 2022, citing healthy customer demand and supply chain conditions [22] - The company anticipates a 4% capacity increase in Q1 2022 and a total of 16% to 17% for the year [27] - Management noted that the automotive and industrial applications are expected to continue as multi-year growth drivers [33] Other Important Information - Total assets at the end of Q4 2021 were NT$ 42,523 million, with total liabilities of NT$ 18,137 million [18] - Free cash flow for the year was NT$ 956 million, down from NT$ 1,559 million in 2020 [19] Q&A Session Summary Question: Insights on better memory visibility of DRAM and Flash in Q1 2022 - Management noted that rush orders from customers for commodity DRAM contributed to better visibility, and they expect high single-digit year-over-year revenue growth company-wide in 2022 [27] Question: Details on niche DRAM in 2022 - Niche DRAM customers have reserved capacity from specific wafer foundries, and the exit of Korean DRAM players from the DDR3 & DDR4 market is beneficial for the supply chain in Taiwan [29] Question: CapEx and depreciation for 2022 - CapEx for 2022 is expected to be about 20% of annual revenue, excluding planned expenses for green energy and future expansion [30] - Depreciation is expected to increase by about 3% to 4% quarterly [30]