AMEC says net profit rose 108% last year

Shanghai-based AMEC, the largest semiconductor equipment maker on the Chinese mainland, more than doubled its net profit last year, it said on Friday.

AMEC, or Advanced Micro-Fabrication Equipment Inc, attributed the growth to orders from top integrated circuit makers, the company listed on the SSE STAR Market said. 

Net profit in 2019 jumped 108 percent to hit 189 million yuan (US$27 million), the high-end of the company’s expectations of between 176 million yuan and 192 million yuan. AMEC’s revenue was 1.95 billion yuan last year, a 19 percent growth year on year.

The market still has great potential with new demands such as wearable computing, smart home appliances, autonomous driving, robots, 3D displays and new-technology LED displays, it said. Meanwhile, it had orders for 5-nanometer chips from top memory chip makers, the company said.

Chips with smaller sizes of transistors, such as 7-nanometer and 5-nanometer, represent the world’s most advanced technology.

The company is going to be a “world-class semiconductor firm within a decade,” AMEC’s CEO Gerald Yin said. 

Orders and market demand are “generally good” this year, Yin said. 

However, the market is still dominated by tech giants in Europe, America and Japan, such as Lam Research, Tokyo Electron and Applied Materials, AMEC said in its annual report statement.

Last year, the company invested 425 million yuan in research and development, or 21.8 percent of its total revenue.

The company is expected to generate net profit of 255 million yuan this year and 335 million yuan in 2021, with a high growth rate despite an uncertain economy and the effect of the COVID-19 outbreak, Huatai Securities said. 

AMEC has “core high-tech assets” in China, which brings it investment value, Huatai said.

In the long term, the semiconductor industry has opportunities, though it faces the short-term challenges of the US-China trade dispute, Bill Lu, Asia semiconductor analyst with UBS, said previously.

On Friday, AMEC jumped 5.33 percent to close at 161.00 yuan, compared with a 0.66 percent gain in the Shanghai stock index.