JCET Accelerates Technology Upgrades and Transformation in 2022, Maintaining a Leading Edge in High Value-added Applications

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Mar 30, 2023, 08:08 ET

Q4 2022 Financial Highlights:

Revenue was RMB 8.98 billion, an increase of 4.6% year-on-year.
Generated RMB 1.63 billion cash from operations. With net capex investments of RMB 1.24 billion, free cash flow for the quarter was RMB 0.39 billion.
Net profit was RMB 0.78 billion.
Earnings per share was RMB 0.44, as compared to RMB 0.49 in Q4 2021.

Full Year 2022 Financial Highlights:

Revenue was RMB 33.76 billion, an increase of 10.7% year-on-year. A record high in the company's history.
Generated RMB 6.01 billion cash from operations. With net capex investments of RMB 3.81 billion, free cash flow was RMB 2.20 billion.
Net profit was RMB 3.23 billion, a record high in the company's history.
Earnings per share was RMB 1.82, as compared to RMB 1.72 in 2021.

SHANGHAI, March 30, 2023 /PRNewswire/ -- JCET Group (SSE: 600584), a leading global provider of integrated circuit (IC) manufacturing and technology services, today announced its full year financial results for the year ended December 31, 2022. According to the financial report, in 2022 JCET achieved revenue of RMB 33.76 billion, an increase of 10.7% year-on-year, and net profit attributable to owners of the parent of RMB 3.23 billion, an increase of 9.2% year-on-year.

In 2022, JCET's pioneering efforts in advanced packaging and testing technology and manufacturing continued to yield results. The company has honed its core technological capabilities through in-depth collaboration with global customers, forming a differentiating competitive advantage. The company's XDFOI™ high-density multi-dimensional heterogeneous integration chiplet technologies have entered the stage of high volume manufacturing (HVM). The company now provides multiple customers with HVM advanced packaging solutions for 4D millimeter-wave radar. During the reporting period, the profit and revenue contributed by high-performance, high-density system-level packaging technology and fan-out wafer-level packaging technology showed solid growth year-on-year. The revenue share of high-value-added products such as computing electronics and automotive electronics also continued to grow. Revenue from automotive electronics increased by 85% year-on-year in 2022, while computing electronics increased by 46% year-on-year. The company gained more test businesses in areas such as 5G RF, automotive chips, high-performance computing chips, and related business attributing to a revenue increase of 25% year-on-year. Over the past three years, the company has achieved positive free cash flow for 13 consecutive quarters through continuous improvement in profitability and asset structure, improvement in cash flow capacity, and a decrease in its asset-to-liability ratio.

Always being customer-centric, JCET has comprehensively and continuously improved its production and service quality and has been highly recognized by customers and other parties around the world. At the same time, the company continues to optimize its production capacity structure and actively meet customers' medium and long-term needs. The construction of the Microelectronics Wafer-level Microsystems Integration High-end Manufacturing Project has steadily progressed. In order to further strengthen the product research and development capabilities in the field of cutting-edge technology, the company completed an increase of capital to RMB 1 billion for its wholly-owned subsidiary, JCET Management Co., Ltd. The construction of an Industry 4.0 intelligent new plant in the company's South Korea factory has been completed, and the Singapore factory has achieved a series of automated production and technological upgrades.

Mr. Li Zheng, CEO of JCET said, "In 2022, the company overcame adverse external factors such as shrinking demand in the end consumer market, and completed new technology developments in the fields of automotive electronics, high-performance computing, and other fields as well as the HVM of new products from several world-renowned customers, laying a solid foundation for the company's high-quality development in the future. Since the fourth quarter of 2022, the downward pressure on consumer markets such as mobile phones has remained significant, and the global IC industry is still in a typical downward cycle. JCET is actively utilizing its flexible global layout and the adjustment period in which revenue and profit margins are under short-term pressure to accelerate the active transformation of back-end chip manufacturing processes to high performance, as well as the automation and intelligent upgrade of production lines, to provide sufficient preparation for the global market recovery in the near future, and a new round of application demand growth."

For more information, please refer to the JCET FY2022 Report.

About JCET Group

JCET Group is the world's leading integrated-circuit manufacturing and technology services provider, offering a full range of turnkey services that include semiconductor package integration design and characterization, R&D, wafer probe, wafer bumping, package assembly, final test and drop shipment to vendors around the world.

Our comprehensive portfolio covers a wide spectrum of semiconductor applications such as mobile, communication, compute, consumer, automotive, and industrial, through advanced wafer-level packaging, 2.5D/3D, System-in-Package, and reliable flip chip and wire bonding technologies. JCET Group has two R&D centers in China and Korea, six manufacturing locations in China, Korea, and Singapore, and sales centers around the world, providing close technology collaboration and efficient supply-chain manufacturing to our global customers.

CONSOLIDATED BALANCE SHEET (Audited)		RMB in millions

	Dec 31, 2022	Dec 31, 2021
ASSETS
Current assets
Currency funds	2,459	2,761
Trading financial assets	4,316	2,670
Derivative financial assets	18	5
Accounts receivable	3,689	4,271
Receivables financing	59	28
Prepayments	110	183
Other receivables	61	77
Inventories	3,152	3,193
Assets classified as held for sale	0	99
Other current assets	279	130
Total current assets	14,143	13,417
Non-current assets
Long-term receivables	40	38
Long-term equity investments	765	770
Other equity investments	440	418
Investment properties	89	93
Fixed assets	19,517	18,424
Construction in progress	807	661
Right-of-use assets	578	622
Intangible assets	483	447
Goodwill	2,210	2,023
Long-term prepaid expenses	28
Deferred tax assets	247	185
Other non-current assets	61	1
Total non-current assets	25,265	23,682
Total assets	39,408	37,099

LIABILITIES AND EQUITY	Dec 31, 2022	Dec 31, 2021
Current liabilities
Short-term borrowings	1,174	2,193
Derivative financial liabilities	0	2
Notes payable	339	579
Accounts payable	4,634	5,298
Contract liabilities	214	458
Employee benefits payable	984	1,062
Taxes and surcharges payable	210	235
Other payables	378	414
Liabilities classified as held for sale	0	45
Current portion of long-term liabilities	3,096	1,052
Other current liabilities	4	3
Total current liabilities	11,033	11,341
Non-current liabilities
Long-term borrowings	2,721	3,751
Lease liabilities	562	568
Long-term employee benefits payable	14	20
Deferred income	340	337
Deferred tax liabilities	40	82
Other non-current liabilities	55	0
Total non-current liabilities	3,732	4,758
Total liabilities	14,765	16,099
Equity
Paid-in capital	1,780	1,780
Capital reserves	15,080	14,984
Accumulated other comprehensive income	400	(281)
Surplus reserves	229	174
Unappropriated profit	7,154	4,334
Total equity attributable to owners of the parent	24,643	20,991
Minority shareholders	0	9
Total equity	24,643	21,000
Total liabilities and equity	39,408	37,099

CONSOLIDATED INCOME STATEMENT (Audited)		RMB in millions, except share data

	Three months ended		Year ended
	Dec 31, 2022	Dec 31, 2021	Dec 31, 2022	Dec 31, 2021
Revenue	8,984	8,585	33,762	30,502
Less: Cost of sales	7,688	6,882	28,010	24,887
Taxes and surcharges	20	19	90	77
Selling expenses	42	49	184	194
Administrative expenses	95	299	900	1,042
Research and development expenses	333	326	1,313	1,186
Finance expenses	137	29	126	206
Including: Interest expenses	64	43	207	313
Interest income	10	4	31	37
Add: Other income	53	35	191	170
Investment income / (loss)	63	16	128	315
Including: Income / (loss) from investments in associates and joint ventures	1	(291)	(5)	(6)
Gain / (loss) on the net position hedging	0	11	0	0
Gain / (loss) on changes in fair value of financial assets/liabilities	3	(12)	(37)	(12)
Credit impairment (loss is expressed by "-")	17	9	34	23
Asset impairment (loss is expressed by "-")	(131)	(216)	(257)	(268)
Gain / (loss) on disposal of assets	6	2	48	32
Operating profit / (loss)	680	826	3,246	3,170
Add: Non-operating income	2	12	47	18
Less: Non-operating expenses	1	7	2	18
Profit / (loss) before income taxes	681	831	3,291	3,170
Less: Income tax expenses	(98)	(13)	60	210
Net profit / (loss)	779	844	3,231	2,960
Classified by continuity of operations
Profit / (loss) from continuing operations	779	844	3,231	2,960
Classified by ownership	0
Net profit / (loss) attributable to owners of the parent	779	843	3,231	2,958
Net profit / (loss) attributable to minority shareholders	0	1	0	2
Add: Unappropriated profit at beginning of period	6,430	3,544	4,334	1,518
Less: Extract statutory surplus accumulation	55	53	55	53
Cash dividends payable	0	0	356	89
Unappropriated profit at end of period (attributable to owners of the parent）	7,154	4,334	7,154	4,334
Other comprehensive income, net of tax	(151)	(120)	680	(197)
Comprehensive income attributable to owners of the parent	(151)	(120)	680	(197)
Comprehensive income not be reclassified to profit or loss	7	(14)	(7)	(13)
Remeasurement gains or losses of a defined benefit plan	1	(2)	1	(1)
Change in the fair value of other equity investments	6	(12)	(8)	(12)
Comprehensive income to be reclassified to profit or loss	(158)	(106)	687	(184)
Comprehensive income using the equity method that may be reclassified to profit or loss	0	0	0	(21)
Cash flow hedge reserve	23	10	(4)	2
Exchange differences of foreign currency financial statements	(181)	(116)	691	(165)
Total comprehensive income	628	724	3,911	2,763
Including:
Total comprehensive income attributable to owners of the parent	628	723	3,911	2,761
Total comprehensive income attributable to minority shareholders	0	1	0	2
Earnings per share
Basic earnings per share	0.44	0.49	1.82	1.72
Diluted earnings per share	0.43	0.49	1.81	1.72

CONSOLIDATED CASH FLOW STATEMENT (Audited)				RMB in millions

	Three months ended		Year ended
	Dec 31, 2022	Dec 31, 2021	Dec 31, 2022	Dec 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from the sale of goods and the rendering of services	11,033	9,611	36,233	32,445
Receipts of taxes and surcharges refunds	34	49	307	389
Other cash receipts relating to operating activities	103	30	321	237
Total cash inflows from operating activities	11,170	9,690	36,861	33,071
Cash payments for goods and services	8,458	6,031	25,604	20,445
Cash payments to and on behalf of employees	1,019	937	4,275	4,265
Payments of all types of taxes and surcharges	(152)	19	543	608
Other cash payments relating to operating activities	213	68	427	324
Total cash outflows from operating activities	9,538	7,055	30,849	25,642
Net cash flows from operating activities	1,632	2,635	6,012	7,429
CASH FLOWS FROM INVESTING ACTIVITIES
Cash receipts from returns of investments	4,151	3,281	12,701	6,133
Cash receipts from investment income	33	20	89	33
Net cash receipts from disposal of fixed assets, intangible assets and other long-term assets	(3)	10	107	271
Net cash receipts from disposal of subsidiaries and other business units	0	0	30	0
Other cash receipts relating to investing activities	0	10	0	10
Total cash inflows from investing activities	4,181	3,321	12,927	6,447
Cash payments to acquire fixed assets, intangible assets and other long-term assets	1,236	1,345	3,924	4,358
Cash payments for investments	4,300	4,029	14,361	8,405
Total cash outflows from investing activities	5,536	5,374	18,285	12,763
Net cash flows from investing activities	(1,355)	(2,053)	(5,358)	(6,316)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash proceeds from investments by others	0	0	0	4,965
Cash receipts from borrowings	2,255	2,524	5,216	7,153
Other cash receipts relating to financing activities	0	(347)	0	0
Total cash inflows from financing activities	2,255	2,177	5,216	12,118
Cash repayments for debts	2,523	3,099	5,053	11,613
Cash payments for distribution of dividends or profit and interest expenses	29	26	524	392
Including: Dividends or profit paid to non-controlling shareholders of subsidiaries	0	3	0	3
Other cash payments relating to financing activities	(71)	(166)	687	605
Total cash outflows from financing activities	2,481	2,959	6,264	12,610
Net cash flows from financing activities	(226)	(782)	(1,048)	(492)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	(10)	(17)	84	(25)
NET INCREASE IN CASH AND CASH EQUIVALENTS	41	(217)	(310)	596
Add: Cash and cash equivalents at beginning of period	2,412	2,980	2,763	2,167
CASH AND CASH EQUIVALENTS AT END OF PERIOD	2,453	2,763	2,453	2,763