华虹半导体(01347) - 2023 - 年度业绩

Financial Performance - Revenue for the year ended December 31, 2023, reached $2.5 billion, representing a 15$500 million, driven by higher sales and improved operational efficiency[7] - The company's gross margin improved to 30%, up from 28% in the previous year, due to cost optimization and higher production yields[7] - Revenue for 2023 was US$2,286.1 million, a decrease of 7.7$449.9 million in 2023, up from US$280.0 million in 2022[13] - EPS increased to 0.345 in 2023 from 0.201 in 2022[13] - Revenue decreased by 7.7$2,286.1 million in 2023 due to lower average selling prices[123] - Gross profit declined by 42.3% to US$487.1 million, impacted by decreased selling prices and increased depreciation costs[125] - Net profit margin dropped to 5.5$126.4 million[133] Capital Expenditures and Investments - Capital expenditures for the year amounted to $1.2 billion, primarily allocated to the expansion of manufacturing facilities in Wuxi[7] - The company issued 407.75 million RMB shares, which were listed and began trading on the STAR Market on August 7, 2023[9] - Hua Hong Semiconductor's Wuxi subsidiary saw its registered capital increase from$1.8 billion to approximately $2.54 billion following a capital injection[7] - The company's total assets grew by 18$6.8 billion, supported by increased investments in new technologies and market expansion[7] - The Hua Hong Manufacturing Project was launched with an investment of US$6.7 billion for a new 12-inch production line with a monthly capacity of 83,000 wafers[15] - The company commenced construction of a 12-inch production line in Wuxi with a total investment of US$6.7 billion, targeting a monthly capacity of 83,000 wafers[119] - Formation of a joint venture (Wuxi Phase II project) with an investment of US$880.38 million, US$1,169.82 million, US$1,165.8 million, and US$804 million by the Company, HHGrace, China IC Fund II, and Wuxi Xi Hong Guo Xin, respectively, totaling US$4.02 billion in registered capital[185] Research and Development - Research and development expenses for the year totaled$300 million, representing 12% of total revenue, focusing on advanced semiconductor technologies[7] - The company filed 672 patent applications in 2023, bringing the cumulative number of granted invention patents to 4,427[120] - The company focuses on specialty technologies including Embedded/Standalone Non-Volatile Memory, Power Discrete, Analog & PM, and Logic & RF[13] Production Capacity and Shipments - The company achieved an annual shipment of 4.103 million wafers in 2023[15] - Monthly capacity (8-inch equivalent) expanded to 391,000 wafers by the end of 2023[15] - Hua Hong Wuxi reached a monthly capacity of 94,500 wafers, covering IC process nodes from 90 nm to 65/55 nm[15] - Capacity utilization for 8-inch wafer equivalent was 94.3%, a decrease of 13.1% compared to 2022[113] - Wafer shipments increased by 0.4% year-on-year, reaching 4,103 thousand wafers[114] - The company expanded 12-inch capacity and technology, diversifying the product mix of "Specialty IC + Power Discrete"[115] Market and Revenue Segmentation - 95.4% of revenue was generated from semiconductor wafers, with a year-on-year decrease of 8.2%[107] - Revenue from systems and fabless companies accounted for 92.3%, a decrease of 7.0% compared to 2022[108] - Europe revenue increased by 17.5% year-on-year, reaching US$134.76 million[109] - Power discrete revenue grew by 16.5$673.395 million[112] - Automotive electronics revenue maintained year-to-year double-digit growth, driven by mass production of automotive-grade chip products[116] - Power discrete business maintained growth despite market challenges, with a record high number of new products introduced for automotive, electric vehicle, and industrial sectors[117] Corporate Governance and Board Activities - The Board held 10 meetings during the year ended 31 December 2023, with attendance records for each Director provided[60] - The Company has three Independent Non-Executive Directors, representing more than one-third of the Board, ensuring compliance with Listing Rules 3.10 and 3.10A[50] - The Remuneration Committee met on 10 August 2023 to discuss the vesting of options under the Company's share option scheme[67] - The Nomination Committee met on 9 November 2023 to discuss remuneration policy and salary competitiveness[69] - The Company arranged Directors' and Officers' liabilities insurance to cover potential legal actions arising from corporate activities[59] - All Directors participated in continuous professional development, including reading materials and attending training courses[65] - The Board ensures independent views through mechanisms such as independence assessments and communication between the Chairman and Independent Non-Executive Directors[51][53] - The Company complied with the Corporate Governance Code during the year ended 31 December 2023[43] - The Board is responsible for approving material transactions, quarterly results, and internal control systems[49] - The Chairman and President roles are separate, with the Chairman focusing on corporate strategy and the President managing day-to-day operations[57][58] Risk Management and Internal Controls - The company's risk management objective is to identify, assess, and manage risks to reduce their impact and maintain control[96] - The internal control system aims to evaluate the effectiveness of operating activities, reliability of financial reports, and compliance with laws[97] - The company has established a "three-line model" for risk management, covering business supervision, internal audit, and risk monitoring[99] Shareholder Communication and Investor Relations - The company's shareholders' communication policy ensures equal and timely access to information for shareholders[83] - The company organizes roadshows and on-site visits to promote investor understanding of its business[88] - The company's Board diversity policy considers talents, skills, regional experience, gender, age, and other qualities[76] Audit and Financial Reporting - The remuneration paid to auditors for audit services in 2023 was $0.75 million, and for non-audit related services was$0.01 million[71] - The Audit Committee held six meetings in 2023, reviewing financial statements, risk management, and internal control systems[74] - The company's Audit Committee is responsible for reviewing financial reporting systems and ensuring the independence of external auditors[73] Workforce and Gender Ratio - The gender ratio of the company's workforce as of 31 December 2023 was 73% male and 27% female[79] Cash Flow and Financial Position - Cash and cash equivalents surged by 178.0% to US$5,585.2 million, primarily due to increased cash inflows[137] - Net cash flows generated from operating activities decreased by 14.5$641.7 million in 2023, primarily due to reduced customer receipts, partially offset by lower payments for materials, maintenance, and payrolls[141] - Net cash flows used in investing activities amounted to US$833.3 million, mainly driven by US$906.6 million in capital investments, offset by US$61.6 million in interest income and US$11.7 million in government grants[142] - Net cash flows generated from financing activities surged by 462.6% to US$3,781.7 million, including US$2,937.0 million from STAR Market share issuance and US$787.9 million from non-controlling interests[143] - Cash and cash equivalents increased by 178.0$5,585.2 million at the end of 2023, up from US$2,008.8 million at the end of 2022[144] Foreign Exchange and Financial Risks - A 5$47.6 million[149] - As of 31 December 2023, interest-bearing bank borrowings denominated in USD amounted to US$1,653.0 million, exposing the company to foreign currency risk[148] Dividends and Shareholder Distribution - The company proposed a final dividend of HK$0.165 per share, totaling approximately US$36.2 million for 2023, subject to shareholder approval[157][166] - As of 31 December 2023, the company had US$314.1 million in distributable reserves available for shareholder distribution[161] Property and Assets - The company's investment property in Shanghai covers 91,563.11 square meters, held under a land use right expiring in 2051[165] Share Options and Equity - The company's share option scheme expired on 1 September 2022, with 21,144,481 shares remaining available for issuance, representing 1.23% of total issued shares[168] - The company granted 30,250,000 share options on 4 September 2015 with an exercise price of HK$6.912 per share, representing a 0$18.400 per share, representing 0.03% of the issued shares as of 31 December 2023[172] - The company granted 500,000 share options on 29 March 2019 with an exercise price of HK$18.400 per share, representing the higher of the closing price on the grant date, the average closing price for the five business days preceding the grant, and the closing price the day before the grant[174] - On 23 December 2019, the company granted 2,482,000 share options with an exercise price of HK$17.952 per share, representing 0.14% of the issued shares as of 31 December 2023[175] - The company listed 407,750,000 ordinary shares on the STAR Market of the Shanghai Stock Exchange on 7 August 2023 at an issue price of RMB52.00 per share, raising a total of RMB21,203,000,000[180][183] - The net proceeds from the STAR Market listing amounted to RMB20,920,677,000 after deducting issuance expenses, with the funds allocated to projects such as Hua Hong Manufacturing (Wuxi) Project and 8-Inch Factory Optimisation and Upgrading Project[183][184] - The company's share options outstanding as of 31 December 2023 totaled 21,421,849, with exercise prices ranging from HK$6.912 to HK$18.400 per share[177] - The company's share options granted in 2015 and 2018 have vesting periods ranging from 4 September 2015 to 23 December 2025, with exercise periods from 4 September 2017 to 23 December 2025[177] - The company's share options granted in 2019 have a vesting period from 23 December 2019 to 22 December 2026, with an exercise period from 23 December 2021 to 22 December 2026[177] - The company's share options granted in 2019 include 500,000 options granted to directors, subject to their acceptance[176] Joint Ventures and Connected Transactions - The joint venture will manufacture and sell integrated circuits and 12-inch (300mm) wafers using 65/55 nm to 40 nm processes[185] - The Company sold semiconductor products to Huahong Group, its subsidiaries, and associates for US$20,578,000 in 2023, with an annual cap of US$21,100,000[190] - The Company purchased wafers and chemicals from Huahong Group, its subsidiaries, and associates for US$19,234,000 in 2023, with an annual cap of US$31,500,000[190] - The Company sold semiconductor products to SAIL, its subsidiaries, and associates for US$357,000 in 2023, with an annual cap of US$2,000,000[190] - HHGrace provided corporate services to Hua Hong Wuxi for RMB145,000,000 (approx. US$20,644,000) in 2023, with an annual cap of RMB145,000,000[191] - Huali Micro leased factory premises from the Company for RMB97,189,000 (approx. US$13,786,000) in 2023, with an annual cap of RMB99,000,000 (approx. US$14,095,000)[191] - The Company leased dormitory premises from Huahong Real Estate for RMB11,504,000 (approx. US$1,631,000) in 2023, with an annual cap of RMB12,700,000 (approx. US$1,808,000)[193] - The Company engaged Huajin Property Management for property management services for RMB3,993,000 (approx. US$567,000) in 2023, with an annual cap of RMB5,700,000 (approx. US$812,000)[193] - HHGrace leased additional dormitory premises from Huahong Real Estate for RMB6,285,000 (approx. US$891,000) in 2023, with an annual cap of RMB7,300,000 (approx. US$1,039,000)[193] - HHGrace entered into a Technology Development Agreement with Huali Micro for a non-exclusive license to use technological know-how for 12-inch wafers with 40 nm processes, with a consideration between RMB110 million and RMB180 million[198] - Huali Micro, 53.85% owned by Huahong Group, is a connected person of the company, making the Technology Development Agreement a connected transaction under Chapter 14A of the Listing Rules[199] - China IC Fund II agreed to subscribe for RMB Shares up to an aggregate subscription amount of RMB3,000,000,000 as part of the RMB Share Issue[200]