SMIC(00981)2022-02-11 00:30Financial Data and Key Metrics Changes - In Q4 2021, the company achieved a record revenue of 5.443 billion, a year-over-year increase of 39.3% [5] - The operating margin for 2021 was 25.6%, up 17.6 percentage points year-over-year, while the net margin attributable to the company was 31.3%, up 13 percentage points year-over-year [5][6] Business Line Data and Key Metrics Changes - The company reported significant growth in mature technology platforms, particularly in high-voltage drivers, microcontrollers, ultra-low power logic, and specialty memory, which saw the fastest revenue growth [9][10] - The company added a monthly capacity of 100,000 wafers, equivalent to eight-inch wafers, and completed the main structure of the Beijing project in October 2021 [9] Market Data and Key Metrics Changes - The semiconductor industry faced a chip shortage in 2021, driven by structural incremental growth from industry upgrades and increased demand for remote connectivity due to the pandemic [7][8] - The company noted that while overall demand outstripped production capacity, some application areas experienced a slowdown in demand [3][8] Company Strategy and Development Direction - The company aims to dynamically balance existing and incremental demand while filling structural gaps in the supply chain, emphasizing compliance and deep integration into the global supply chain [3][4] - In 2022, the company plans to continue its capital expenditure at a peak level, with an estimated capital expenditure of over 36.1 billion, with total liabilities of 6.8 billion [4] - The company has maintained a negative net debt-to-equity ratio of 38% [5] Q&A Session Summary Question: What are the advantages and pricing trends for 2022? - Management discussed a forecasted revenue growth of 15% to 17% for Q1 2022, with ASP expected to increase due to a shift towards more advanced technologies [14][15] Question: How will the entity list impact production and future expansion? - The entity list has significantly impacted production operations, but the company has managed to maintain operational continuity through close collaboration with suppliers [21] Question: What measures are in place to ensure high capacity utilization amid rapid growth? - The company is focusing on flexible production capabilities across different nodes and maintaining a diverse product platform to adapt to market demands [29][30] Question: What is the expected depreciation pressure in relation to capacity expansion? - Management indicated that depreciation is expected to increase, but efforts are being made to balance this with revenue growth and margin stability [34][35]