Q2 2021 EARNINGS PRESENTATION · 2021. 7. 27. · Q2 2021 EARNINGS PRESENTATION 28th July 2021 1. Disclaimer 2 The information contained in this presentation is provided for informational

Q2 2021 EARNINGS

PRESENTATION28th July 2021

1

Disclaimer

2

The information contained in this presentation is provided for

informational purpose only, and should not be relied upon for the

purpose of making any investment or for any other purpose.

Some of the information used in preparing this presentation was

obtained from third parties or public sources. The information

contained in this presentation has not been independently verified.

No representation or warranty, expressed or implied, is made as to,

and no reliance should be placed on, the fairness, reasonableness,

accuracy, completeness or correctness of such information or

opinions contained herein. It is not the intention to provide, and you

may not rely on this presentation as providing, a complete or

comprehensive analysis of our financial or trading position or

prospects. The information and opinions contained in this

presentation are provided as at the date of this presentation and are

subject to change without notice and will not be updated to reflect

any developments which may occur after the date of this

presentation.

All statements, other than statements of historical facts included in

this presentation, are or may be forward-looking statements.

Forward-looking statements include, but are not limited to, those

using words such as “seek”, “expect”, “anticipate”, “estimate”,

“believe”, “intend”, “project”, “plan”, “strategy”, “forecast” and similar

expressions or future or conditional verbs such as “will”, “would”,

“should”, “could”, “may” and “might”.

These forward-looking statements reflect the Company’s current

expectations, beliefs, hopes, intentions or strategies regarding the

future and assumptions in light of currently available information.

Such forward-looking statements are not guarantees of future

performance or events and involve known or unknown risks and

uncertainties. Accordingly, actual results may differ materially from

information contained in the forward-looking statements as a result

of a number of factors. You should not place undue reliance on

such forward-looking statements, and the Company does not

undertake any obligation to update publicly or revise any forward-

looking statements. No statement in this presentation is intended to

be or may be construed as a profit forecast.

We also do not undertake any obligation to provide you with access

to any additional information or to update this presentation or any

additional information or to correct any inaccuracies in this

presentation or any additional information which may become

apparent.

This presentation does not constitute an offer or invitation to

purchase or subscribe for any shares and no part of it shall form the

basis of or be relied upon in connection with any contract,

commitment or investment decision in relation thereto.

Key Highlights

Financial Performance

Q&A

AGENDA

3

Outlook

4

KEY HIGHLIGHTS

Strategic Focus on Long-term Profitability

Superior Operational and Fulfilment Execution

Strong Performance from Advanced Packaging

Q2 2021 Group Key Highlights

5

FINANCIAL PERFORMANCE

6

Q2 2021 Group Financial ResultsRevenue Exceeded Guidance and Bookings Better than Expected

7

HK$732m

Net Profit

Revenue

US$667m

40.6%

Gross

Margin

Bookings

US$943m

Cash and Bank

DepositsBacklog

US$1.49b

1,009 943

1,952

559667

1,226

0

500

1,000

1,500

2,000

2,500

Q1 2021 Q2 2021 1H 2021

US

D’M

Bookings Revenue

Q2 / 1H 2021 Group Financial PerformanceRecord 1H Revenue and Bookings

8

Record backlog of US$1.49b

1H21 strong revenue performance driven by:

- Acceleration of CAPEX plans and expansion of capacity

investments

- Long-term secular trends (HPC, automotive electrification, 5G)

- Broad-based demand fuelled by reopening of major economies

Better than expected 1H21 Group bookings driven by:

- Automotive, Consumer and Industrial applications more than

doubling HoH

Q2 Group revenue exceeded guidance

Sequential improvement in GM – Q3 2020 to Q2 2021

528

732

1,261

-

200.0

400.0

600.0

800.0

1,000.0

1,200.0

1,400.0

1,600.0

1,800.0

Q1 2021 Q2 2021 1H 2021

HK

D’M

Net Profit 1 including share of results from Advanced Assembly Materials International Limited (AAMI), a joint-venture, commencing from the beginning of 2021

39.6%Gross

Margin 40.6% 40.1%

1

552681

1,233

-

200

400

600

800

1,000

1,200

1,400

1,600

1,800

Q1 2021 Q2 2021 1H 2021

HK

D’M

Segment Profit

Strong Q2 bookings for mainstream die and wire bonding tools, and

advanced packaging panel-level ECD tools

Q2 Revenue trends:

IC/D: Dominated by mainstream die and wire bonders and test

handlers

Opto: Strong demand for general lighting. More Mini LED

customers adopting HVM deployment and continued engagement

with Micro LED customers

CIS: Slight but encouraging QoQ improvement underpinned by

broad and favourable customer mix

Q2 GM improved YoY due to higher volume, capacity utilization,

increased productivity and effects from Group’s strategic initiatives

Three consecutive quarters of revenue and profit growth

Q2 / 1H 2021 Semiconductor Solutions Segment PerformanceScaled External Manufacturing Capacity to Capture Strong Demand

9

685

553

1,238

349408

756

0

200

400

600

800

1,000

1,200

1,400

Q1 2021 Q2 2021 1H 2021

US

D’M

Bookings Revenue

44.0%Gross

Margin 43.8% 43.9%

Q2 GM registered significant YoY growth due to favourable product

mix, increased volume and utilisation, and positive effects from

strategic initiatives

Q2 revenue grew QoQ for mainstream high-end placement tools

Printing tools experienced increased demand on the back of key

customer wins

Q2 revenue grew QoQ for advanced packaging tools, including

highly accurate SiP tools

Two quarters of record bookings

Sharp improvement in Q2 GM

Q2 / 1H 2021 SMT Solutions Segment PerformanceRecord Bookings

10

325390

714

211259

470

0

100

200

300

400

500

600

700

800

Q1 2021 Q2 2021 1H 2021

US

D’M

Bookings Revenue

165

314

479

-

100

200

300

400

500

600

Q1 2021 Q2 2021 1H 2021

HK

D’M

Segment Profit

32.2%Gross

Margin 35.5% 34.0%

Key partner to industry leading customersWe Serve Industry-Leading Semiconductor and Electronics Manufacturers Across the Globe

Top 5 customers accounted for only 14.4% of Group 1H 2021

revenue reflecting high degree of diversity

1H 2021 Segment Revenue Contribution

(by geography)

11

Top customers include leading

companies in:

• Integrated Device Manufacturers (IDMs)

• Outsourced Semiconductor Assembly and Test

vendors (OSATs)

• High-Density Substrate

• Automotive component

• EMS

• Telecommunication and Information Technology

• LED

• Camera module

Europe12%

Americas8%

Taiwan7%

Korea5%

Thailand4%

Malaysia4%

Japan2%

Vietnam2%

Philippines1%

Singapore1%

Others1%

China53%

Key End-Market ApplicationsGrowing Demand Across Several End-Market Applications

Computers

Consumer

Communication

Industrial

Automotive

OthersPersonal Computers

Servers

Datacenters

HPC

Other Computers

TV

Wearables

Audio devices

Video devices

Gaming consoles

Other Consumers

Mobile Phones

Wired Infrastructure

Wireless Infrastructure

EV Charging

Smart Factories

Smart Offices

Other Industrial

Visual Sensors

Infotainment

LIDAR Sensors

5G communications

Entertainment

Platforms

Medical Devices

Aerospace

Others

Others (Spares)*Revenue mix is based on management’s best estimates.

**Others include revenue from spares, services or contribution and other applications that cannot be meaningfully identified.

1H 2021 Revenue Mix*

12

1H 2021 Group Billing Application TrendsAll Three End Applications Witnessed Significant HoH and YoY Growth

13

▪ Demand for wearables, gaming consoles, conventional fine pitch RGB displays and general lighting

driving growth

▪ Closely engaging key customers in Mini LED

▪ Continued rebound, driven by automotive electrification (in particular, Mainland China) and general

recovery of the Automotive sector

▪ Strong growth in discrete and power management applications from SEMI solutions segment

▪ Strong growth fueled by broad based demand for automation and control devices in varied application,

including smart grids and EV charging infrastructure

Automotive

Industrial

Consumer

13

Strong Advanced Packaging Performance from Broadening Customer Base

14

Revenue contribution crossed $1B over 3-year period

(2H18 - 1H21)

Panel-level ECD tools maintained dominant position with

tier-1 high density interconnect substrate suppliers

Strong demand for SMT SiP tools

The Group's diverse AP portfolio spans wafer-level to die-level high-accuracy placement tools and SiP placement

tools, addressing a broad range of packaging technologies (2.5D, 3D-IC, Fan-in, Fan-out Wafer-Level and SiP)

1H21 booking exceeded ~80% of FY2020’s booking

DEK Galaxy

Silicon

Interposer

FIREBIRDNUCLEUS NEXXSIPLACE TX

SeriesLaser1205

X-PU

High Bandwidth

Memory

Wafer Level Mold

Underfill (Protects Integrated Wafer)

Selected examples of our Advanced Packaging solutions

1.6

0.60.4

0.81.0

0.81.2 1.3 1.3

0.7

1.3

0.8

0.30.5

1.3

0.41.1

1.31.4

0.7 2.0

FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 1H2021

Interim Dividend Final Dividend

32% 53% 61% 53% 59% 53% 36% 49% 132% 68%

Dividend policy of consistent annual dividend payout ratio of around 50% (consistent with average dividend payout ratio 2011-2020)

15

FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20

Dividend Payout (%)

1H 21

1H 2021 DividendsYoY Increase of ~86%

Div

ide

nd

Pe

r S

ha

re

(HK

D)

Annual

Dividend

Payout

OUTLOOK

16

Financial OutlookQ3 2021 Revenue Guidance Supported by Record Backlog

17

Q3 2021 Revenue Outlook

USD 730m to USD 780m

2H 2021 revenue to remain strong

18

FINANCIAL APPENDIX

391

287 299

575528

0

100

200

300

400

500

600

700

FY2017 FY2018 FY2019 FY2020 1H 2021

Shareholders’ Equity

(USD’M)

1,456

1,5531,494

1,7021,745

1,300

1,350

1,400

1,450

1,500

1,550

1,600

1,650

1,700

1,750

1,800

FY2017 FY2018 FY2019 FY2020 1H 2021

Cash and Bank Deposit

(USD’M)

Capital Expenditure

(USD’M)

Net Working Capital (USD’M),

as a percentage of sales

1,252

9411,149 1,221 1,239

56%

38%

56% 56%

0%

10%

20%

30%

40%

50%

60%

-100

100

300

500

700

900

1,100

1,300

1,500

FY2017 FY2018 FY2019 FY2020 1H 2021

19

Group Balance Sheet Highlights

Results of the Group’s former Materials Segment have been deconsolidated since 29 December 2020. Commencing first quarter of 2021, its contributions have been equity accounted for in the Group’s performance.

82104

88

50

130

20

40

60

80

100

120

FY2017 FY2018 FY2019 FY2020 1H 2021

Group Balance Sheet Highlights

241

260272

260 256

170

190

210

230

250

270

290

2017 2018 2019 2020 1H 2021(Annualised)

Cash Conversion Cycle1 (Days)

0

100

200

300

400

500

600

700

800

900

1,000

2017 2018 2019 2020 1H 2021

US

D’M

Inventory1

0

100

200

300

400

500

600

700

800

2017 2018 2019 2020 1H 2021

US

D’M

Accounts Receivable1

1 Excludes contribution from Material Segment from FY2020 onwards, which has been deconsolidated and equity accounted for since 29 December 2020.

20

21

Q&A

THANK YOU