GlobalWafers Inc (環球晶圓), the world’s No. 3 silicon wafer supplier, on Tuesday said that revenue would regain growth momentum this year, driven by a rebound in the automotive sector and 5G smartphones, as well as emerging technologies such as artificial intelligence (AI).
“We believe 2021 will be better than 2020,” GlobalWafers chairwoman Doris Hsu (徐秀蘭) told a virtual investors’ conference.
“We expect customer inventories to have a less negative impact on demand in 2021,” Hsu said. “We believe wafer demand is strong and high, and our production loading is good.”
Photo: CNA
The mega trends of 5G, AI, electric vehicles and digitization would continue to fuel semiconductor demand this year, Hsu said.
Signs point to positive developments in the industry this year, she said.
That is why GlobalWafers plans to proceed with the tender offer for Siltronic AG to expand capacity, she said.
The deal is expected to close in the second half of this year, following regulatory clearance, GlobalWafers said.
The company has received approvals from antitrust bodies in Australia, Germany and the US.
GlobalWafers said that an improvement in product portfolios would also help fuel revenue growth and enhance profitability this year, after its 300mm fab in South Korea began production early this year.
The Hsinchu-based company’s revenue last year fell 4.7 percent to NT$55.36 billion (US$1.96 billion), from NT$58.09 billion in 2019, as the COVID-19 pandemic curbed demand for smartphones and automobiles.
Net profit slid 3.9 percent to NT$13.1 billion last year, compared with NT$13.64 billion in 2019, while earnings per share fell to NT$30.11 from NT$31.35.
Gross margin rose to 39.7 percent — a new high — from 39 percent a year earlier.
Taiwan Ratings Corp (中華信評) assigned GlobalWafers “twAA-” long-term and “twA-1+” short-term issuer credit ratings and gave the company a stable outlook.
The acquisition of Germany-based Siltronic, when completed, could improve GlobalWafers’ position in the global raw semiconductor wafer market to No. 2 in terms of revenue, Taiwan Ratings said.
That meant GlobalWafers’ market share would rise to about 27 percent, up from 15 percent last year and close to that of the Japan-based market leader, Shin-Etsu Chemical Co, the ratings agency said.
More importantly, GlobalWafers would narrow its technology gap with leading players by gaining more exposure in advanced wafers and technological enhancement, it said.
“GlobalWafers could strengthen its market position and profitability, despite a surge in debt for integrating Siltronic,” the local arm of Standard & Poor’s Global Ratings said.
However, its relatively inferior technology positioning compared with the Japanese firm and high product concentration would limit GlobalWafers’ competitive position, Taiwan Ratings said, adding that Shin-Etsu has a well-established reputation and has consistent quality.
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