Huatian Technology (002185) Annual Report and First Quarterly Report Review: Pressure on Performance Improvement and Cost Control and Advanced Packaging to Be Breakthrough
Financial report: On April 30, 2019, the company disclosed its 2018 annual report.
During the reporting period, the company realized income from main operations 71.
22 ppm, an increase of 1 per year.
60%; operating profit 4.
880,000 yuan, a decrease of 22 a year.
31%; net profit attributable to mother 3.
90 ‰, a decrease of 21 per year.
27%; non-net profit attributable to mother 3.
08 million yuan, a decrease of 27 a year.
33%; net cash flow from operating activities11.
33 ppm, an increase of 25 per year.
40%; basic profit income is 0.
18 yuan / share, a decrease of 21 per year.
30%; estimated average return on net assets is 7.
07%, a decrease of 2 from last year.
Comment: Company profile: The company is a domestic integrated circuit packaging and testing leader, and its industrial scale ranks among the top ten in the global integrated circuit packaging and testing industry.
In the 2018 annual report, the revenue share of integrated circuits and LEDs was 96.
30% and 3.
70%, domestic and foreign revenue share is 42.
30% and 57.
The semiconductor cycle is down, customer demand is the highest, LED-driven main business has grown slightly, and rising costs have dragged down net profit.
In 2018, integrated circuits achieved revenue of 68.
58 ppm, a reduction of 0 per year.
42%, gross profit margin 16.
73%, a decrease of 1 from the previous year.
46 averages; LED realized revenue 2.
64 ppm, an increase of 114 per year.
17%, gross profit margin 5.
77%, an increase of 3 from the previous year.
The product structure improved, and the scale of advanced packaging business further expanded.
In 2018, the company completed a total of 267 integrated circuit packages.
2.4 billion, down 5 years ago.
40%, wafer-level integrated circuit package volume 56.
400,000 tablets, an increase of 17 in ten years.
51%, the proportion of wafer-level integrated circuit packaging increased significantly, and product structure improved.Bumps, WLP and other advanced packaging capacity have been further increased, and the conditions and capabilities for accepting bulk orders have passed the reviews of major mainstream companies such as Huawei, Apple, Samsung, OPPO, VIVO, Xiaomi, etc., and some products have been supplied by customersgoods.
北京夜生活 R & D funding has increased steadily, and R & D for advanced packaging technologies has continued.
R & D funding in 20183.
8.4 billion, accounting for 5 of the revenue.
39%, ranking 2017 (5.
04%) increased steadily.
FPGA + FLASH multi-chip packaging to achieve mass production; millimeter-wave radar chip silicon-based fan-out packaging into small-scale production; wafer-level bump technology to achieve mass production of 16/14 nanometer chip chips; 3DNAND 8-layer packaging technology,XWFN packaging technology, automotive electronics insertable flanking QFN technology, and F-BAR filter packaging technology have entered small-scale production.
Acquired Unisem 58.
94% of shares in circulation, perfecting the industrial layout.
The settlement was completed on January 18, 2019, and a total of approximately 4 Unisem shares were acquired.
2.9 billion shares, accounting for 58 of Unisem’s outstanding shares.
Unisem company provides three integrated circuit packaging bases in Ipoh, Perak, Malaysia, Chengdu, China and Batam, India. It has advanced packaging technologies and production capabilities such as bumps, SiP, FC, MEMS, etc. The packaged products are mainly in the RF and automotive electronics fieldsEuropean and American customers account for more than 60% of their revenue.
The acquisition further improved the company’s economic layout.
Promote the construction of Nanjing Advanced Packaging and Testing Industrial Base, Baoji Lead Frame and Packaging and Testing Equipment Industrial Base projects.
The main body of the Nanjing Advanced Packaging and Testing Industrial Base is expected to be completed by the end of 2019. As long as the equipment is installed, the layout of East China will be improved.
It is expected that the construction of the Baoji Lead Frame and Packaging and Testing Equipment Industry Base in 2019 will complete the construction of the project. It must have production conditions to meet the needs of the parent company and its subsidiary Huatian Xi’an for lead frames and reduce the company’s overall cost.
The rights issue will supplement working capital and improve the financial structure.
The total amount of funds to be raised from the rights issue public offering of securities shall not exceed US $ 1.7 billion, after deducting the issuance expenses, it shall not exceed US $ 800 million to supplement the working capital and not exceed US $ 900 million to repay the remaining debt.
The performance of the first quarter of 2019 is not good, and there is some pressure to achieve the expected goals.
In the first quarter of 2019, the company realized operating income of 17.
11 ‰, a decrease of 11 per year.
24%; net profit attributable to mother is 0.
17 trillion, a reduction of 79 a year.
51%; realized non-net profit attributable to mothers 83.
One million yuan, a year reduction of 98.
Non-recurring gains and losses are mainly income government subsidies.
The company’s production target for 2019 is $ 7.8 billion in revenue. The poor performance in the first quarter overlaps with the downside factors of the semiconductor market cycle. The target achieved has some pressure.
Investment suggestion: The semiconductor boom will decline in 2019, and there is a certain pressure on the company’s maximum production capacity to increase. It will take a certain amount of time to advance the volume of advanced packaging technology. Long-term attention is recommended.
Risk warning: trade war escalation risk; downside risk of industry prosperity; risk of rising costs; risk of intensified industry competition; less-than-expected risk of technological development; exchange rate risk