SMIC Reports 2022 Fourth Quarter Results

All currency figures stated in this report are in US Dollars unless stated otherwise.

The consolidated financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS").

SHANGHAI, Feb. 9, 2023 /PRNewswire/ -- Semiconductor Manufacturing International Corporation (SEHK: 00981; SSE STAR MARKET: 688981) ("SMIC", the "Company" or "we"), one of the leading semiconductor foundries in the world, today announced its consolidated results of operations for the three months ended December 31, 2022.

2022 Fourth Quarter Highlights

• Revenue was $1,621.3 million in 4Q22, compared to $1,907.0 million in 3Q22, and $1,580.1 million in 4Q21.
• Gross profit was $518.7 million in 4Q22, compared to $742.2 million in 3Q22, and $552.8 million in 4Q21.
• Gross margin was 32.0% in 4Q22, compared to 38.9% in 3Q22 and 35.0% in 4Q21.
• Revenue was $7,273.3 million in 2022, an increase of 33.6% YoY from $5,443.1 million in 2021.
• Profit attributable to owners of the Company was $1,817.9 million in 2022, an increase of 6.8% YoY from $1,701.8 million in 2021.

First Quarter 2023 Guidance 

The Company expects (in accordance with IFRS):

• Revenue to decrease by 10% to 12% QoQ.
• Gross margin to range from 19% to 21%.

The Management Comments

In the fourth quarter of 2022, the Company's revenue was $1,621 million, down 15% sequentially, and gross margin was 32%, which were both in line with the Company's guidance and expectation.

According to the unaudited financial results, the Company's revenue for 2022 full year crossed to $7.2 billion, up 34% year-over-year，with annual growth rate of more than 30% for two consecutive years in 2021 and 2022. The gross margin in 2022 increased to 38%, hit a record high. Capital expenditures in 2022 was $6.35 billion. By the end of the year, monthly capacity increased to 714 thousand 8-inch equivalent wafers. The annual capacity utilization rate was 92%. By the end of 2022, SMIC Shenzhen entered into production, SMIC Jingcheng entered into pilot production, SMIC Lingang completed construction of main fab shell, and SMIC Xiqing started the construction. The mass production of SMIC Jingcheng is scheduled to postpone by one to two quarters due to the delay of bottleneck equipment.

Looking forward to 2023, in the first half of the year, the industry cycle is still at the bottom, the impact of external uncertainties is still complex. The Company's first quarter guidance is as follows: revenue is expected to be down 10% to 12% sequentially, and the gross margin is expected to decline to the range from 19% to 21%. Based on the premise that the external environment is relatively stable, for the full year of 2023:

• Revenue is expected to decline by low-teens percentage year-over-year, and the gross margin is expected to be around 20%.
• Depreciation is expected to increase by more than 20% year-over-year, the capital expenditures is expected to maintain roughly flat compared to previous year.
• Incremental monthly capacity by the end of the year is expected to be similar to that of previous year.

During the process of continuous high investments, gross margin is under the pressure of high depreciation. The Company will always target sustained profitability, strive to grasp the pace of capacity expansion to ensure a certain level of gross margin.

To see the complete results including financial tables, please click here: 

https://www.smics.com/uploads/63e4d9b4/Q422_EN.pdf

Date: Friday, February 10, 2023

Time: 8:30 A.M. - 9:30 A.M.

WEBCAST

The call will be webcast live at:

https://edge.media-server.com/mmc/p/rjw8n9xc

CONFERENCE CALL

Please register in advance for the conference call at:

https://register.vevent.com/register/BIf148856846c94545ab37b672b82f4ecf

REPLAY

Recording will be available 1 hour after the event and it will be archived for 12 months.

https://www.smics.com/en/site/company_financialSummary

Semiconductor Manufacturing International Corporation (SEHK: 00981; SSE STAR MARKET: 688981) and its subsidiaries is one of the leading foundries in the world and is the front runner in manufacturing capability, manufacturing scale, and comprehensive service in the Chinese Mainland. SMIC Group provides semiconductor foundry and technology services to global customers on 0.35 micron to FinFET process node technologies. Headquartered in Shanghai, China, SMIC Group has an international manufacturing and service base, with three 8-inch wafer fabrication facilities ("fabs") and four 12-inch fabs in Shanghai, Beijing, Tianjin and Shenzhen, and three 12-inch fabs under construction in Shanghai, Beijing and Tianjin. SMIC Group also has marketing and customer service offices in the U.S., Europe, Japan, and Taiwan, China, and a representative office in Hong Kong, China.

For more information, please visit www.smics.com.

This release contains, in addition to historical information, forward-looking statements. These forward-looking statements are based on SMIC's current assumptions, expectations, beliefs, plans, objectives, and projections about future events or performance. SMIC uses words including but not limited to "believe", "anticipate", "intend", "estimate", "expect", "project", "target", "going forward", "continue", "ought to", "may", "seek", "should", "plan", "could", "vision", "goal", "aim", "aspire", "objective", "schedule", "outlook" and other similar expressions to identify forward looking statements. These forward-looking statements are necessary estimates reflecting judgment of SMIC's senior management and involve significant risks, both known and unknown, uncertainties and other factors that may cause SMIC's actual performance, financial condition or results of operations to be materially different from those suggested by the forward-looking statements including, among others, risks associated with cyclicality and market conditions in the semiconductor industry, intense competition in the semiconductor industry, SMIC's reliance on a small number of customers, timely wafer acceptance by SMIC's customers, timely introduction of new technologies, SMIC's ability to ramp new products into volume, supply and demand for semiconductor foundry services, industry overcapacity, shortages in equipment, components, raw materials and software, availability of manufacturing capacity, financial stability in end markets, orders or judgments from pending litigation, intensive intellectual property litigation in the semiconductor industry, general economic conditions and fluctuations in currency exchange rates.

In addition to the information contained in this release, you should also consider the information contained in our other filings with The Stock Exchange of Hong Kong Limited ("SEHK") and Shanghai Stock Exchange ("SSE") from time to time. Other unknown or unpredictable factors also could have material adverse effects on our future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated or, if no date is stated, as of the date of this release. Except as required by applicable laws, SMIC undertakes no obligation and does not intend to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the possible or actual occurrence of unanticipated events after the date on which such statement is made, whether as a result of new information, future events or otherwise.

To supplement SMIC's consolidated financial results presented in accordance with IFRS, SMIC uses the presentation of non-IFRS financial measures, including EBITDA, EBITDA margin and non-IFRS operating expenses in this release. The presentation of non-IFRS financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with IFRS. These non-IFRS financial measures are not calculated or presented in accordance with, and are not alternatives or substitutes for financial measures prepared in accordance with IFRS, and should be read only in conjunction with the Group's financial measures prepared in accordance with IFRS. The Group's non-IFRS financial measures may be different from similarly-titled non-IFRS financial measures used by other companies.

SMIC believes that use of these non-IFRS financial measures facilitates investors' and management's comparisons to SMIC's historical performance. The Group's management regularly uses these non-IFRS financial measures to understand, manage and evaluate the Group's business and make financial and operational decisions.

The accompanying table has more information and reconciliations of each non-IFRS financial measure to its most directly comparable IFRS financial measure.

Contact:

Investor Relations

+86-21-2081- 2800

[email protected]

SOURCE SMIC