ACMSH(688082)2025-03-18 14:57Summary of the Conference Call for Shengmei Shanghai Company Overview - Shengmei Shanghai has been impacted by the new U.S. entity list regulations, which include the company and its subsidiaries in mainland China and South Korea. However, the company believes it can manage the effects on its operations and maintain stable sales to overseas customers [3][4]. Financial Performance - In 2024, Shengmei Shanghai reported revenue of 5.618 billion RMB, a year-on-year increase of 44.48%, with a shipment volume of 6.931 billion RMB. The net profit attributable to shareholders was 1.153 billion RMB, up 23.6% [3][5][13]. - The company achieved a gross profit of 3.745 billion RMB, with a gross margin of 48.86%. The net profit after excluding share-based payment expenses was 1.444 billion RMB, reflecting a growth of 35.48% [5][13]. - As of the end of 2024, total assets were 12.128 billion RMB, with cash and cash equivalents amounting to 2.775 billion RMB [5][13]. Business Segments - Shengmei Shanghai's business is primarily driven by three product lines: cleaning, plating, and CD packaging. The revenue from single-wafer cleaning and semi-critical cleaning equipment grew by 55.18% to 4.057 billion RMB, accounting for 72.22% of total revenue [3][6]. - Revenue from plating aluminum tubes and other front-end equipment increased by 20.97% to 1.137 billion RMB, representing 20.24% of total revenue. Advanced packaging and other back-end equipment revenue rose by 26.85% to 423 million RMB, making up 7% of total revenue [6]. Market Position and Growth - Shengmei Shanghai estimates its addressable market size at approximately 18 billion USD. The semiconductor wafer fabrication equipment market in mainland China is projected to grow by 12% in 2024, reaching 38 billion USD [3][7]. - The company’s growth rate significantly exceeds the industry average, with a projected revenue growth of 44% in 2024 [7]. Innovations and Product Development - The company has made breakthroughs in advanced packaging, securing orders for four wafer-level packaging devices and launching three panel-level packaging devices suitable for GPU and HBM packaging [3][9]. - Shengmei Shanghai's new R&D and manufacturing center in Lingang is expected to be operational by June 2025, enhancing operational efficiency and supply chain autonomy [3][11]. Future Outlook - For 2025, Shengmei Shanghai anticipates annual operating performance between 6.5 billion and 7.1 billion RMB, driven by original innovation and differentiated technology [3][12]. - The company plans to continue investing in R&D, with an allocation of 838 million RMB in 2024, representing 14% of revenue, and a 27% increase year-on-year [3][14]. Customer Base and Market Expansion - The number of customers for plating and aluminum tube equipment has increased from nine at the end of 2023 to 17 by the end of 2024, indicating strong customer expansion [15]. - New customer acquisitions are expected to contribute to revenue in the second half of the year, with further growth anticipated in the following year [17]. Competitive Landscape - Shengmei Shanghai maintains confidence in its technology and market position despite competition from Japanese manufacturers introducing similar products. The company views this as a positive development for the industry [25][26]. - The company emphasizes the importance of maintaining an open market for fair competition among domestic and international suppliers [26][27]. Conclusion - Shengmei Shanghai is well-positioned to navigate regulatory challenges while capitalizing on significant growth opportunities in the semiconductor equipment market, driven by innovation, a diversified product portfolio, and a strong customer base [3][4][12].