Summary of Semiconductor Manufacturing International Corporation Q4 performance meeting: Q1 guidance, production capacity, capital expenditure

What are the factors affecting the Q1 guidelines? Focus on improving effective production capacity? 5 billion what about capital expenditure? Let's take a look.$SMIC (00981.HK)$How do executives respond at Q4 performance meeting

[key points]

1. Goal:Q1 revenue is expected to grow by 15% qu 17% month-on-month, and gross profit margin is expected to be 36% 32% 38%. Revenue growth is expected to be better than the industry average in 2022, and capital expenditure is expected to be US $5 billion.

two。 Products:The production capacity gathers 8-inch expansion, 12-inch mature process and FinFET diversification.

3. Expand production:The two projects in Beijing and Shenzhen are expected to be put into production by the end of the year, and the planned capacity increase for the whole year will exceed 2021.

[QA Q & A]

The Q1:Q1 guidelines expect revenue to grow by 15% muri 17% month-on-month, how much of this comes from pricing and volume, and is the price trend expected to continue to rise after Q1, or will it start to level off?

A1: we don't exactly comment on wafer pricing, we use ASP as the standardized price parameter for the whole company.We hope that the average ASP growth will be more than 10%, and we will see a 6.5% increase in total wafers in terms of quantity.With regard to price trends, we will see higher price increases in the next few quarters.

The gross profit margin of Q2:Q1 guidelines is 36% Mui 38%, slightly higher than last year's 31%. How should we model this?

A2:Q1 's forecast does have a gross margin of 36% per cent, 38 per cent.The modeling takes into account two factors, depreciation and supply chain.We have considered the additional depreciation of capital expenditure that has expanded over the past three years. The new Capex will be depreciated at Q3 and Q4. With regard to the potential of the market and the supply chain, we are still on the entity list, and although we will encounter many difficulties, we know that we can maintain normal operation at this time.

Q3: what measures can be taken to ensure high capacity utilization in the context of rapid capacity growth? Where does the main demand come from?

A3: the production capacity is mainly focused on three points, 18 inches: at present, there are not many colleagues in the world to expand production by 8 inches, but the company focuses on the copper and aluminum production process of 0.13-0.18 microns, mainly doing power IC, which is in great demand. For example, the mobile phone uses BCD technology, the technology of the company is also improving, and the demand for 8-inch MCU is also relatively large.

Due to the late construction of the 212in mature process, the basic model of the 90-22nm equipment is the same, and we can convert it in this range. For example, 50nm can do 45nm, but the process steps are different, so capacity allocation needs some flexibility. At present, the main production capacity is 40 and 55nm. 40nm is the most out of stock in the market so far this year, with a large demand of 55.

3FinFET: the company started relatively late, and there are many application platforms and customers. In the case of relatively small production capacity, the development of diversification is better, and diversification can ensure full utilization.

Q4: does the 5 billion capital expenditure this year take into account factors such as late delivery? This year's capacity growth translates into effective production capacity, how much will it actually increase?

A4:Equipment delay has been considered. The part of 5 billion that buys new land and delivery rooms is pretty sure there will be no delay.Some devices are delayed (especially for small companies), but not all of them. In 2021, the lowest forecast is 10, 000 for 12 inches and 45, 000 for 8 inches, which actually exceeds this figure. The equivalent of 8 inches is a little more than 100000.This year's growth will exceed this number, and it is expected to be between 13 and 150000 pieces, calculated on the basis of the shipping capacity reached. This year, production capacity is more concentrated in the nodes with complex processes, with high prices and more profit growth.

How to adjust capital expenditure dynamically if supply exceeds demand in Q5R28 and 40nm?

A5: we have been very careful to observe the direction of the market, our customers are complex, there are a large number of customers, and we will be more flexible. The proportion of each product is relatively small, and the application and process can be switched freely. We have made great efforts to avoid the capacity loss caused by capacity conversion, and have made a different capacity platform at each node.Worry about 28 and 40nm, our production capacity only accounts for a small share, will not significantly affect the surplus of the entire market, and the company's node expansion capacity is less than 10% of customer demand.

Do you have any plans for Q6 12-inch production expansion?

A6: we do not cut according to Moore's Law, our Capex is the result of consultation with the customer, and all nodes have increments. However, the efficiency or utilization of different products in a factory is not good. When we build new capacity, we will build the same process nodes in different areas to standardize to solve this problem.In Shenzhen, we hope to take the high-voltage drive of large, medium and small panels as the main product.Shenzhen will also do verification on the platforms set up in Beijing and Shanghai, where some orders from the two places will be transferred when the market fluctuates.

To learn more, click to watch Semiconductor Manufacturing International Corporation's 2021Q4 performance call.

377K Views