Earning First Take : 1Q22 Net profit increased 57% y-o-y, ahead of market consensus
- 1Q22 net profit increased 57% y-o-y to HK$5.3bn , ahead of the market consensus by 31.5%
- The outstanding performance is due to the robust growth experienced in the automotive and the Advanced Packaging
- Semiconductor solutions and SMT solutions’ margins expand 0.68ppt and 3.31ppt y-o-y
- Expect share price support in the near term
What’s New
– ASM Pacific (522 HK) announced its 1Q22 results before Hong Kong market open today.
– Revenue maintained a strong growth at 21.5% y-o-y to HK$ 5.3bn in 1Q22, in line with management guidance.
– Booking growth declined to 10.0% y-o-y, ahead of the market consensus.
– Segment-wise, Semiconductor solutions revenue increased by 8.8% y-o-y to HK$ 2.9bn, SMT solutions revenue resumed growth of 42.4% y-o-y to HK$ 23.3 bn.
– Semiconductor solutions and SMT solutions’ margins increased 0.68ppt and 3.31ppt y-o-y in 1Q22
– Net profit grew 57.1% y-o-y to HK$ 830.2m, ahead of the market consensus by 31.5%, EPS was HK$ 2.02.
– The Group expects 2Q22 revenue to be between HK$5.2 bn to HK$5.8 bn, representing growth of 5.8% y-o-y at the mid-point.
Our View:
– The profit beat market consensus by 31.5%. The outstanding performance is due to the robust growth experienced in the automotive and the strong demand for Advanced Packaging Tools and the margin expansion of the group.
– We expect the growth in the automotive and industrial market of the semiconductor industry to remain strong growth in 2022 due to supply tightness and strong end-market demand.
– We expect the Advanced Packaging growth momentum to remain strong driven by the demanding requirements for ultra-fine pitch Mini LED RGBs and increasingly advanced SiP requirements for consumer and communication applications.
– Long-term outlook remains intact due to the persistently strong Capex investment in the semiconductor industry despite the market sentiment impacted by the recent lockdown due to the Omicron outbreak.
– We expect near-term share price support owing to 1Q profit ahead of the market consensus and management’s 2Q22 revenue guidance in line with market consensus.
– We currently rate BUY on the counter with TP at HK$138.0.