ASMVF - ASMPT Limited (ASMVF) Q1 2024 Earnings Call Transcript

2024-04-24 04:55:23 ET

ASMPT Limited (ASMVF)

Q1 2024 Earnings Conference Call

April 23, 2024 8:30 PM ET

Company Participants

Romil Singh – Head-Investor Relations

Robin Gerard Ng Cher Tat – Group Chief Executive Officer

Katie Xu – Senior Vice President and Group Chief Financial Officer

Conference Call Participants

Gokul Hariharan – JPMorgan

Donnie Teng – Nomura

Dylan Liu – Morgan Stanley

Leping Huang – Huatai Securities

Simon Woo – Bank of America Merrill Lynch

Presentation

Romil Singh

All right, since time is 8:31, good morning and good evening, ladies and gentlemen. This is Romil here from the Investor Relations team and I will be the moderator for today’s call. On behalf of ASMPT Limited, let me welcome all of you to The Group’s Investor Conference Call for the First Quarter of 2024 and we would like to thank you for your interest and your continued support in the company. Please note that all participants will be on listen-only mode when the management is presenting. We will start the Q&A only after the management has gone through the entire presentation. During the Q&A session, priority will be given to the covering analysts.

As part of our standard disclaimer, please do note that during this conference call there may be forward-looking statements with respect to the company’s business and financial conditions. Such forward-looking statements could involve known and unknown uncertainties and risks that could cause actual results, performance and events to differ materially from those expressed or implied during this conference call. For your reference, the investor relations presentation for our recent results is available on our website. On today’s call, we have the Group Chief Executive Officer, Robin; and the Group Chief Financial Officer, Katie. Robin will cover the Group’s key highlights, outlook and the guidance for second quarter, while Katie will provide details on the financial performance. And then we will open the floor for Q&A.

So with that, let me hand the time over to Robin now.

Robin Gerard Ng Cher Tat

Thank you, Rom. Good morning and good evening to everyone today. It is a pleasure to have you all on our earnings conference call for the first quarter of 2024. Before we begin, let me take this opportunity to share some thoughts on the overall macro environment and some key highlights of our business. The macroeconomic environment continues to present challenges. While the slow recovery of the Chinese economy continues, there have been dynamic and often rapidly evolving geopolitical conflicts that have rolled markets. Coupled with stubborn inflationary pressure and the more recent sphere of interest rate hikes, overall consumer sentiment remained weak, trickling down and causing tepid electronics demand. Against this backdrop, our unique and broad based portfolio shielded us to a certain extent as our two segments follow different cycles.

For the first quarter, ASMPT delivered revenue at a midpoint of guidance with a higher revenue proportion from our SMT business. Our broad based portfolio serves diverse end markets. And this continued to be an advantage for us because weakness in some end markets can at times be compensated by strength in others. For this quarter, the Group’s automotive applications continued to form the highest proportion of our overall Group revenue. Revenue from SMT’s automotive application also grew compared with the previous quarter despite softness in the overall automotive market.

As for SEMI, its automotive solution benefitted owing to exposure to certain specialized technology areas of the supply chain, such as power and silicon carbide modules and smart headlamps for high-end vehicles. An important development for the Group in the first quarter was a book-to-bill ratio that moved above one after seven quarters. Bookings for the Group grew in the first quarter as both business segments had higher bookings when compared to the previous quarter. SEMI’s booking growth was also due to a low base effect. SMT bookings grew quarter-on-quarter and began stabilizing after softening in the second half of 2023, mainly due to automotive and industrial end markets.

The Group bookings growth in the first quarter was mostly propelled by strong demand for its advanced packaging, or AP solutions, with both SEMI and SMT contributing strongly to Group AP’s booking. The Group’s interconnect solutions, including thermal compression bonding, hybrid bonding and flip chip high precision die-bonding were mainly driven by AI, together with SMT’s system in package or SIP tools this contributed strongly to Group’s AP bookings in the first quarter.

Let me share more about the progress of our AP solutions, which have the highest growth potential under our portfolio. Undoubtedly, advanced packaging continues to be a bright spot for the Group. We strongly believe that the Group has the industry’s most comprehensive suite of AP solutions that serve a diverse range of applications. Moreover, we are deeply embedded in the supply chain of major generative AI and high performance computing customers, and hence are in a commanding position to capitalize on the growing demand from an increasing range of such applications....

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