SMIC(HK:00981)2020-09-07 09:42Financial Performance - The company reported total revenue of approximately $1.843 billion, a historical high, representing a year-on-year growth of 26.3%[11] - Net profit attributable to shareholders reached approximately $202 million, a historical high, with a year-on-year increase of 5.6 times[11] - EBITDA was approximately $766 million, reflecting a year-on-year growth of 45.1%[11] - Revenue for the six months ended June 30, 2020, was $1,843,375 thousand, representing a 26.3% increase compared to $1,459,781 thousand for the same period in 2019[12] - Profit attributable to owners of the company for the period was $202,133 thousand, a significant increase of 556.0% from $30,811 thousand in the previous year[12] - The company reported a net profit margin of 9.6%, a substantial improvement from a net loss margin of -0.1% in the previous year[13] - Gross profit increased by 76.5% from $273.2 million to $482.2 million, attributed to changes in product mix, increased wafer shipments, and higher average selling prices[25] - Operating profit turned from a loss of $18.4 million in the previous year to a profit of $112.0 million in the current period[26] - Net profit for the period was $177.0 million, compared to a loss of $1.4 million in the same period last year[27] - The company achieved a basic earnings per share of $0.04, compared to $0.00 in the same period last year[13] Revenue and Sales Growth - Revenue increased by 26.3% from $1,459.8 million in the same period last year to $1,843.4 million, driven by a 19.7% increase in wafer shipments and a rise in average selling price[23] - Wafer shipments rose from approximately 2.4 million 8-inch wafers in the same period last year to 2.8 million 8-inch wafers in the current period[23] - Revenue from mainland China and Hong Kong was $1,177,203 thousand, up from $810,264 thousand in 2019, representing a growth of 45.3%[163] Assets and Liabilities - Total assets increased to $20,388,178 thousand, a 24.0% rise from $16,437,820 thousand at the end of the previous year[12] - Total liabilities grew from $6,240.0 million to $7,210.5 million, primarily due to increased payables for property, plant, and equipment[30] - Total liabilities amounted to $7.21 billion, up from $6.24 billion, reflecting an increase of approximately 15.6%[148] - The company’s borrowings decreased to $1.69 billion from $2.00 billion, a reduction of approximately 15.7%[148] - Cash and cash equivalents increased to $3,130.1 million from $2,238.8 million year-over-year[36] Capital Expenditures and Investments - The company has initiated a new round of capital expenditure plans to enhance core competitiveness and drive continuous growth[11] - Planned capital expenditures for the contract manufacturing business in 2020 are approximately $6.7 billion, primarily for machinery and equipment capacity expansion[38] - The company reported a total of 39,702,165 stock options granted, with 29,562,909 options remaining unexercised as of June 30, 2020[140] Research and Development - Research and development expenses were $324,485 thousand, a slight decrease of 2.4% compared to $332,479 thousand in the prior year[21] - The company has improved its product mix to enhance production efficiency in response to strong demand for mature process applications[95] - The company has entered the customer product verification phase for its second-generation advanced processes[95] Corporate Governance - The board consists of 14 directors, with a mix of executive and independent non-executive members, ensuring diverse governance[104] - The company has adhered to the corporate governance code and internal trading policies throughout the reporting period[102][103] - The audit committee consists of three members, all of whom have never served as executives or employees of the company or its subsidiaries[109] Shareholder and Equity Information - Major shareholders include China Information Communication Technology Group Limited and Datang Telecom Technology Industry Holdings Limited, each holding 15.10% of the company's issued share capital[122] - The company has a total of 5,690,665,932 ordinary shares issued as of June 30, 2020[122] - The company reported a total of 22,763,000 ordinary shares outstanding as of June 30, 2020, compared to 20,227,000 as of December 31, 2019[152] Risk Management and Compliance - The company has not reported any changes in risk management policies since December 31, 2019, indicating stability in its financial risk management approach[161] - The company is committed to compliance with Hong Kong Listing Rules regarding connected transactions, including disclosure and annual review requirements[80] Future Outlook - The company plans to continue its market expansion and invest in new technologies to drive future growth[20] - The company aims for a revenue growth target of 15% to 19% for the full year 2020, despite the impact of COVID-19[95] - The company is focused on maintaining its leadership in integrated circuit manufacturing and is exploring potential mergers and acquisitions to bolster its market position[156]