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华虹半导体(01347.HK):2Q22销售均价持续提升 特色工艺具竞争优势

Hua Hong Semiconductor (01347.HK): the average sales price of 2Q22 continues to improve, and the characteristic process has a competitive advantage.

中金公司 ·  Aug 13, 2022 00:00  · Researches

2Q22 revenue / gross margin exceeds previous guidance

Hua Hong Semiconductor announced 2Q22 results: the company's 2Q22 single-quarter revenue of US $621 million, YoY+79.4%,QoQ+4.4%, slightly exceeded the previous performance guidance of US $615 million; gross profit margin of 33.6% GI YoYao8.8pptJOQ QoQQ 6.7ppt, exceeding the previous performance guidance of 28% to 29%; and the net profit of its parent was US $83.93 million, YoY+90.4%,QoQ-18.5%. The increase in the average wafer selling price has led to an increase in revenue and gross profit margin in the current quarter, but the company's net profit has declined due to the devaluation of the RMB.

Trend of development

In terms of wafer size, the company's 2Q22 8-inch revenue is $354 million per quarter, YoY+35.1%,QoQ+6.4%, gross profit is 44.2%, and YoY+35.1%,QoQ+6.4%, gross profit is 44.2%. The 12-inch revenue is $267 million, and the YoY+217.1%,QoQ+1.8%, gross profit is 19.6%. The increase in the average wafer selling price has led to a significant increase in 8-inch and 12-inch gross profit margins.

According to the technology platform, the company's 2Q22 single-quarter embedded non-volatile memory accounts for 28.2% of revenue, and discrete devices account for 30.5% of revenue, which is still the company's two main process platforms; benefiting from the growth in demand for NOR Flash and power management products, revenue from independent non-volatile memory, simulation and power management increased by 279.8% and 133.0% year-on-year, growing rapidly.

The company's 2Q22 single-quarter operating expenses of 71 million US dollars, the increase in YoY+54.0%,QoQ-6.1%, labor expenses and the reduction of government R & D subsidies increased operating expenses compared with the same period last year, but declined month-on-month due to the reduction of bonuses. Other losses of US $57 million were mainly due to large losses on foreign currency exchange in the quarter.

The company's 2Q22 capital expenditure was $112 million in a single quarter, mainly for 12-inch plants. As of 2Q22, the company has a 12-inch production capacity of 65,000 tablets per month. Management expects the remaining 30,000 tablets / monthly production capacity to be fully released by the end of the year.

The company expects 3Q22 to generate revenue of about $625 million a quarter and a gross profit margin of 33 to 34 per cent. Because of the competitive advantages of the company's five characteristic process platforms, the company's 2Q22 revenue from consumer electronics products remains at a high level, and the management believes that the characteristic process will continue to make the company's performance resilient.

Profit forecast and valuation

We basically left the company's profit forecast unchanged, forecasting revenue growth of 56.3% to US $25.49 billion and net profit of 32.9% to US $347,400 million in 2023. The company's current stock price corresponds to 2022 1.4x/1.2x 2023. We keep the company's outperform industry rating unchanged and the target price unchanged at HK $36, which is based on 1.9xP/B in 2022, which is 37.7% upside from the current level.

Risk

The trend of average sales price is lower than expected; capacity utilization is lower than expected; risk of epidemic spread

The translation is provided by third-party software.


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