JCET's Global Manufacturing Strategy Produces Records for Revenue and Profit in Q3

JCET Group

2020/11/3 12:35

AsiaNet 86383

SHANGHAI, Oct. 30, 2020 /PRNewswire=KYODO JBN/ --

Q3 2020 Financial Highlights:

• Revenue was RMB 6.79 billion. On a comparable basis, taking into account

the accounting change in revenue recognition, it was an increase of 11.2%

year on year (see note).

• Generated RMB 1.48 billion cash from operations, up 171.3% year on year.

With net capex investments of RMB 0.69 billion, free cash flow for the

quarter was RMB 0.79 billion.

• Net profit was RMB 0.40 billion, a record high in the company's history.

• Earnings per share was RMB 0.25, as compared to RMB 0.05 in Q3 2019.

Note: During the reporting period, we optimized the business model for the

purchase and sale of certain packaged products, of which JCET Group no longer

bears the general inventory risk on the main raw materials. In accordance with

PRC GAAP, both revenue and costs of goods sold were recorded on the net basis

and decreased by RMB 1.05 billion respectively. This change had no impact on

the company's net profit. Assuming that revenue was still recognized by the

gross method (should be recorded on the net basis according to PRC GAAP), it

would be RMB 7.84 billion, an increase of 11.2% over the same period last year.

JCET Group Co., Ltd. (Shanghai Stock Exchange code: 600584), a world leading

provider of semiconductor microsystem integration packaging and testing

services announced financial results for the third quarter 2020, ended

September 30, 2020. Revenue was RMB 6.79 billion and net profit was RMB 0.40

billion, showing steady revenue growth and continued improvement in

profitability. JCET has achieved revenue of RMB 18.76 billion and net profit of

RMB 0.76 billion through the first three quarters, both representing record

highs for the company.

JCET has continued to grow its strategic partnerships with global industry

leading semiconductor manufacturers by accelerating the growth of high volume

production capacity of advanced assembly and test processes and engaging in

robust market strategies. These initiatives have led to improvements in key

financial metrics.

Mr. Li Zheng, Chief Executive Officer of JCET Group, said, "By expanding the

integration of the resources in each of our worldwide operations, we have

accelerated the growth of our production capacity for devices designed for key

applications in the 5G, high-performance computing and high-end storage

markets. Additionally, the technical services capabilities of each of our

global factories have been enhanced significantly due to the continued

improvements driven by our company's world-class management team."

Ms. Janet Chou, Chief Financial Officer of JCET Group, said, "With strong

execution and operational discipline, JCET delivered record profit in the third

quarter of 2020. We remain committed to driving profitable growth and cash

generation. Given the improved liquidity position and healthier balance sheet,

we will continue to invest in critical technologies to strengthen our core

competencies."

About JCET Group:

JCET Group is a leading global semiconductor system integration packaging and

test provider, offering a full range of turnkey services that include

semiconductor package integration design and characterization, R&D, wafer

probe, wafer bumping, package assembly, final test and drop shipment to vendors

around the world.

Our comprehensive portfolio covers a wide spectrum of semiconductor

applications such as mobile, communication, compute, consumer, automotive and

industry etc., through advanced wafer level packaging, 2.5D/3D,

System-in-Packaging, and reliable flip chip and wire bonding technologies. JCET

Group has two R&D centers in China and Korea, six manufacturing locations in

China, Korea and Singapore, and sales centers around the world, providing close

technology collaboration and efficient supply-chain manufacturing to customers

in China and around the world.

CONSOLIDATED BALANCE SHEET (Unaudited)		RMB in millions

	As of
ASSETS	Sep 30, 2020		Dec 31, 2019
Current assets
Currency funds	2,248		2,569
Derivative financial assets	3		4
Accounts receivable	3,851		3,350
Receivables financing	85		68
Prepayments	201		188
Other receivables	11		11
Inventories	3,138		2,731
Current portion of non-current assets	56		137
Other current assets	194		501
Total current assets	9,787		9,559
Non-current assets
Long-term receivables	30		40
Long-term equity investments	941		972
Other equity investments	491		517
Investment properties	97		100
Fixed assets	17,970		17,799
Construction in progress	1,176		1,664
Intangible assets	556		587
Goodwill	2,159		2,214
Long-term prepaid expenses	0		1
Deferred tax assets	124		128
Other non-current assets	1		1
Total non-current assets	23,545		24,023
Total assets	33,332		33,582

CONSOLIDATED BALANCE SHEET (CONTINUED) (Unaudited)		RMB in millions

	As of
LIABILITIES AND EQUITY	Sep 30, 2020		Dec 31, 2019
Current liabilities
Short-term borrowings	5,797		9,098
Derivative financial liabilities	42		161
Notes payable	487		958
Accounts payable	5,212		4,618
Receipts in advance	0		113
Contract liabilities	30		0
Employee benefits payable	777		586
Taxes and surcharges payable	116		53
Other payables	217		235
Current portion of long-term liabilities	2,510		1,827
Total current liabilities	15,188		17,649
Non-current liabilities
Long-term borrowings	2,680		1,585
Bonds payable	1,022		0
Long-term payables	714		1,216
Long-term employee benefits payable	2		1
Deferred income	365		337
Deferred tax liabilities	158		156
Total non-current liabilities	4,941		3,295
Total liabilities	20,129		20,944
Equity
Paid-in capital	1,603		1,603
Surplus reserves	10,242		10,242
Accumulated other comprehensive income	232		429
Specialized reserves	122		122
Unappropriated profit	994		231
Total equity attributable to owners of the parent	13,193		12,627
Minority shareholders	10		11
Total equity	13,203		12,638
Total liabilities and equity	33,332		33,582

CONSOLIDATED INCOME STATEMENT (Unaudited)					RMB in millions, except share data

	Three months ended			Nine months ended
	Sep 30, 2020	Sep 30, 2019	Sep 30, 2020			Sep 30, 2019
Revenue	6,787	7,047	18,763			16,196
Less: Cost of sales	5,631	6,209	15,863			14,507
Taxes and surcharges	11	9	28			26
Selling expenses	59	71	175			199
Administrative expenses	252	265	687			814
Research and development expenses	277	227	768			576
Finance expenses	179	223	482			657
Including: Interest expenses	131	220	433			589
Interest income	12	7	31			20
Add: Other income	17	31	97			217
Investment income / (loss)	(1)	5	(8)			1
Including: Income / (loss) from investments in a ssociates and joint ventures	(1)	5	(8)			2
Gain / (loss) on the net position hedging	6	0	1			0
Gain / (loss) on changes in fair value of financial assets	28	0	28			0
Credit impairment (loss is expressed by "-")	(1)	2	(7)			(6)
Asset impairment (loss is expressed by "-")	0	(1)	(25)			(15)
Gain / (loss) on disposal of assets	33	7	42			14
Operating profit / (loss)	460	87	888			(372)
Add: Non-operating income	3	0	3			1
Less: Non-operating expenses	10	0	18			4
Profit / (loss) before income taxes	453	87	873			(375)
Less: Income tax expenses	55	10	108			(194)
Net profit / (loss)	398	77	765			(181)
Classified by continuity of operations
Profit / (loss) from continuing operations	398	77	765			(181)
Classified by ownership
Net profit / (loss) attributable to owners of the parent	398	77	764			(182)
Net profit / (loss) attributable to minority shareholders	0	0	1			1
Add: Unappropriated profit at beginning of period	598	(116)	231			143
Less: Other reductions	2	0	2			0
Unappropriated profit at end of period (attributable to owners of the parent)	994	(39)	994			(39)

CONSOLIDATED INCOME STATEMENT (CONTINUED) (Unaudited)				RMB in millions, except share data

	Three months ended		Nine months ended
	Sep 30, 2020	Sep 30, 2019	Sep 30, 2020		Sep 30, 2019
Other comprehensive income, net of tax	(354)	241	(197)		199
Comprehensive income attributable to owners of the parent	(354)	241	(197)		199
Comprehensive income not be reclassified to profit or loss	(10)	0	(10)		0
Change in the fair value of other equity investments	(10)	0	(10)		0
Comprehensive income to be reclassified to profit or loss	(344)	241	(187)		199
Comprehensive income using the equity method	0	0	0		0
Cash flow hedge reserve	(1)	(1)	1		4
Exchange differences of foreign currency financial statements	(343)	242	(188)		195
Total comprehensive income	42	318	567		18
Including:
Total comprehensive income attributable to owners of the parent	42	318	566		17
Total comprehensive income attributable to minority shareholders	0	0	1		1
Earnings per share
Basic earnings per share	0.25	0.05	0.48		(0.11)
Diluted earnings per share	0.25	0.05	0.48		(0.11)

CONSOLIDATED CASH FLOW STATEMENT (Unaudited)				RMB in millions

	Three months ended			Nine months ended
	Sep 30, 2020	Sep 30, 2019	Sep 30, 2020		Sep 30, 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from the sale of goods and the rendering of services	6,468	6,695	19,360		16,651
Receipts of taxes and surcharges refunds	105	139	528		297
Other cash receipts relating to operating activities	244	69	767		277
Total cash inflows from operating activities	6,817	6,903	20,655		17,225
Cash payments for goods and services	4,241	5,200	13,584		12,376
Cash payments to and on behalf of employees	856	911	2,644		2,699
Payments of all types of taxes and surcharges	81	173	313		411
Other cash payments relating to operating activities	159	74	482		377
Total cash outflows from operating activities	5,337	6,358	17,023		15,863
Net cash flows from operating activities	1,480	545	3,632		1,362
CASH FLOWS FROM INVESTING ACTIVITIES
Cash receipts from returns of investments	6	37	6		103
Cash receipts from investment income	0	2	0		2
Net cash receipts from disposal of fixed assets, intangible assets and other long-term assets	38	30	65		45
Other cash receipts relating to investing activities	0	0	0		20
Total cash inflows from investing activities	44	69	71		170
Cash payments to acquire fixed assets, intangible assets and other long-term assets	726	627	2,062		2,157
Total cash outflows from investing activities	726	627	2,062		2,157
Net cash flows from investing activities	(682)	(558)	(1,991)		(1,987)

CONSOLIDATED CASH FLOW STATEMENT (CONTINUED) (Unaudited)				RMB in millions

	Three months ended			Nine months ended
	Sep 30, 2020	Sep 30, 2019	Sep 30, 2020		Sep 30, 2019
CASH FLOWS FROM FINANCING ACTIVITIES
Cash receipts from borrowings	1,418	2,350	9,950		10,843
Other cash receipts relating to financing activities	0	1,103	0		1,880
Total cash inflows from financing activities	1,418	3,453	9,950		12,723
Cash repayments for debts	2,311	3,407	10,452		12,613
Cash payments for distribution of dividends or profit and interest expenses	120	232	425		669
Other cash payments relating to financing activities	206	51	491		766
Total cash outflows from financing activities	2,637	3,690	11,368		14,048
Net cash flows from financing activities	(1,219)	(237)	(1,418)		(1,325)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	(48)	37	(33)		43
NET INCREASE IN CASH AND CASH EQUIVALENTS	(469)	(213)	190		(1,907)
Add: Cash and cash equivalents at beginning of period	2,525	2,512	1,866		4,206
CASH AND CASH EQUIVALENTS AT END OF PERIOD	2,056	2,299	2,056		2,299