Malaysian Pacific Industries Bhd. · MYX:MPI
Malaysian Pacific Industries Bhd — Q3 FY2021 Earnings Presentation
58 slides from Malaysian Pacific Industries Bhd's earnings presentation, October 2021
Slide 1: Investor Presentation Q3 FY2021
1 M A L A Y S I A N P A C I F I C I N D U S T R I E S B E R H A D I N V E S T O R P R E S E N T A T I O N Q 3 F Y 2 0 2 1 ( J a n - M a r ’ 2 1 ) INVESTOR RELATIONS CONTACT Rohit Kumar +605 5262333 extn 8497 [email protected] Malaysian Pacific Industries Berhad
Slide 2: Table of Content
1 2 TABLE OF INTRODUCTION CONTENT 2 CORPORATE OVERVIEW 3 BUSINESS OVERVIEW 4 SUSTAINABILITY 5 GROWTH DRIVERS 6 FINANCIALS & SUMMARY
Slide 3: Business overview: MPI, a member of the Hong Leong Group
3 Business overview MPI – A MEMBER OF THE HONG LEONG GROUP Hong Leong Group and MPI • The Hong Leong Group was established over 50 years ago and is one of The Hong Leong Group the largest conglomerates in Asia One of the Largest Conglomerates in Malaysia • Carsem and Dynacraft are operating companie
Slide 4: Quarterly Snapshot
4 Quarterly Snapshot KEY FIGURES – Q3 FY21 Revenue (US$ million) PAT growth 129 240% vs Q3 FY20 Revenue growth EPS 44% 37.55c vs Q3 FY20 Net Cash (RM million) CAPEX growth 927 >100% vs Q3 FY20 Malaysian Pacific Industries Berhad
Slide 5: Investment highlights
5 Investment highlights STRONG FUNDAMENTALS DELIVERING INDUSTRY LEADING RESULTS Revenue (US$ million) PAT (RM million) Net cash increase by 351 236 15% YTD* FY21 YTD* FY21 YTD FY21 vs YTD FY20 Revenue growth PAT growth Equity-Debt Ratio 24% 92% 100:0 YTD FY21 vs YTD FY20 YTD FY21 vs YTD FY20 Q2 FY21
Slide 6: Business Outlook
6 Business Outlook MPI will continue to benefit from • Long term technology drivers – in particular, RF (5G) in Asia, and power (SiC, GaN) & automotive (electrification, sensors, safety) across US, EU • Localization driven demand trends in China • Positioning of reliable supply center for US & EU, b
Slide 7: Table of Content
1 7 TABLE OF INTRODUCTION CONTENT 2 CORPORATE OVERVIEW 3 BUSINESS OVERVIEW 4 SUSTAINABILITY 5 GROWTH DRIVERS 6 FINANCIALS & SUMMARY
Slide 8: Journey & Capabilities
8 Milestones Carsem One of the most JOURNEY & CAPABILITIES trusted OSAT Power Management 5G 5G TEST partners globally - CuClip Technology for Cloud Server Farms RF – Smartphone Thin & Multi-Die MLP – Small & Thin Sensors TVS SiC tech X3 for Mobile Market Sensors Sensors for Automotive For RF & power
Slide 9: Board of Directors
9 Board of Directors YBHG DATUK KWEK LENG SAN MANUEL ZARAUZA MS LIM TAU KIEN CHAIRMAN; Non-Executive/ GROUP MANAGING DIRECTOR/ Non-Executive Director/ Independent Non-Independent Non-Independent • Appointed to BoD of MPI in Jul 1990, and as GMD of • Over 25 years of experience across various • Has b
Slide 10: Management team
10 Management team Many years of consolidated experience in the industry MANUEL ZARAUZA, GROUP MANAGING DIRECTOR, MPI Over 25 years of manufacturing sector experience; Previously with Siemens, Osram Opto Semiconductors, and Seoul Semiconductor ERIC CHEAH, CFO, MPI INDERJEET SINGH, GM, CARSEM S-SITE,
Slide 11: Table of Content
1 11 TABLE OF INTRODUCTION CONTENT 2 CORPORATE OVERVIEW 3 BUSINESS OVERVIEW 4 SUSTAINABILITY 5 GROWTH DRIVERS 6 FINANCIALS & SUMMARY
Slide 12: Supply Chain & Business Model
12 Supply Chain & Business Model CARSEM’S PACKAGING & TESTING SERVICES FORM A VITAL PART OF SEMICONDUCTOR VALUE CHAIN IC backend Boxing/ PCB manu- SMT SMT End Mask IC frontend production module/ System design IC Design facturing Assembly Assembly customer production production (Assembly & system (ba
Slide 13: Wide Portfolio
13 Wide Portfolio COMPREHENSIVE TURNKEY PACKAGING & TEST SERVICES ACROSS KEY APPLICATIONS Automotive System in Quad Flat Package MLP Small Outline IC Package (SiP) (QFP) Industrial Transient Voltage Power Management Consumer & MEMS & Sensors Copper Clip Flip Chip Suppressor (TVS) (SiC, GaN, GaN on C
Slide 14: Geographic footprint
14 Geographic footprint BROAD GEOGRAPHIC PRESENCE, SERVING A GLOBAL CUSTOMER BASE CARSEM NORTH AMERICA CARSEM EUROPE CARSEM S. KOREA CARSEM SUZHOU, CHINA CARSEM JAPAN CARSEM TAIWAN CARSEM IPOH, MALAYSIA DYNACRAFT INDUSTRIES, S-SITE, M-SITE PENANG, MALAYSIA LEGEND Manufacturing plants & Sales offices
Slide 15: Production facilities
15 Production facilities CARSEM MANUFACTURING SITES & BUSINESS UNITS Carsem (M-Site, Ipoh) ▪Floor Space: 436K sq.ft. (40,500 sq. m.) SOIC MICRO MSU ▪Workforce: 2,135 employees Automotive & Consumer ▪GM: Sharon Ko Carsem (S-Site, Ipoh) ▪Floor Space: 640K sq.ft. (60,000 sq. m.) PMG MLP TEST ▪Workforce
Slide 16: Production facilities: floor space expansion
16 Production facilities FOOR SPACE EXPANSION FOR PIPELINE, COMMITMENTS & BUSINESS GROWTH CHINA MALAYSIA • 2nd Phase Level 2 Carsem Suzhou to be completed by • Adding 121K Sq. ft of production floor space in Ipoh (M Q3 CY2021 – Additional 50K Sq. ft. site) to cater to increasing demands • Scouting f
Slide 17: Table of Content
1 17 TABLE OF INTRODUCTION CONTENT 2 CORPORATE OVERVIEW 3 BUSINESS OVERVIEW 4 SUSTAINABILITY 5 GROWTH DRIVERS 6 FINANCIALS & SUMMARY
Slide 18: UN Sustainable Development Goals
18 UN Sustainable Development Goals FOLLOWING MPI’s SUSTAINABILITY STRATEGIES & INITIATIVES, WE CONTRIBUTE TO FOLLOWING SDGs Quality Education Industry, Innovation & Infrastructure • Promote learning opportunities for employees • MPI’s core business helps improve essential • With our business in tec
Slide 19: Economic – Environmental – Social (EES) Aspects
19 Economic – Environmental – Social (EES) Aspects WE HAVE IDENTIFIED EES ASPECTS CRUCIAL TO OUR BUSINESSES Product management and innovation, coupled with supply chain development, are our top priorities to make this goal a success Our environment stewardship is working towards achieving energy eff
Slide 20: Energy & Water Management
20 Energy & Water Management ENERGY CONSUMPTION & NET WATER SAVINGS INDEX REDUCED BY 10% & 7% YoY RESPECTIVELY Continuous reduction in energy consumption by investing Successful execution of water conservation in energy reduction activities programmes helping reduce water consumption Malaysian Pacif
Slide 21: Waste Management
21 Waste Management ZERO LANDFILL WASTE MPI – Hazardous disposal channel • Fewer hazardous wastes were being generated & no landfill disposal • Reasonably consistent recovery trend in hazardous disposal channel for MPI • Focused continuous improvement programs to reduce the waste • Committed to cont
Slide 22: Corporate Social Responsibility (CSR)
22 Corporate Social Responsibility (CSR) ASSISTING WIDER COMMUNITY Carsem carried out CSR activity by distributing 100,000 facemasks starting with employees and their families, then to frontliners and deprived section of society: • Medical personnel in various clinics & hospitals • Perak Police • Cu
Slide 23: Environmental Social Governance (ESG)
23 Environmental Social Governance (ESG) PROACTIVE & STRINGENT ADDRESSAL OF ESG MATTERS WITH WHISTLEBLOWING POLICY IN PLACE Ensuring safe living environment for our employees’ safety Strict compliance with Government SOPs Certificate of Hostel Satisfactory outcome of MITI’s periodic enforcement chec
Slide 24: Environmental Social Governance (ESG)
24 Environmental Social Governance (ESG) ANTI-BRIBERY AND CORRUPTION POLICY & MANAGEMENT SYSTEM Received SIRIM certification for implementing Anti-Bribery Management Systems complying with ISO 37001:2016, MS ISO 37001:2016 Malaysian Pacific Industries Berhad
Slide 25: Table of Content
1 25 TABLE OF INTRODUCTION CONTENT 2 CORPORATE OVERVIEW 3 BUSINESS OVERVIEW 4 SUSTAINABILITY 5 GROWTH DRIVERS 6 FINANCIALS & SUMMARY
Slide 26: Macroeconomic Landscape
26 Macroeconomic Landscape MPI excels even in challenging macro environment Covid, Trade war, uncertainties – Brexit, rise in raw materials costs, Forex fluctuations! Malaysian Pacific Industries Berhad
Slide 27: Industry Dynamics
27 Industry Dynamics MPI IS GROWING AT A RECORD PACE, DRIVEN BY STRONG MARKET DEMAND MPI REVENUE (US$ million) Semiconductor growth is driven by favorable trends… ✓ Global Semiconductor Industry grew 18% in Q3 FY21 YoY and 4% against Q2 FY21 - Semiconductor Industry Association ✓ Green technology is
Slide 28: Growth Strategy
28 Growth Strategy OUR LONG TERM VISION IS TO BE THE LEADING OSAT FOR AUTOMOTIVE, DRIVEN BY 4 STRATEGY TENETS Sales Technology • Strategic sales across application & geography • Investing in 5G testing, SiC, MEMS sensors segments • Advanced packaging – inorganic options for modules/ 3D printing/ des
Slide 29: Sales – Revenue Composition
29 Sales – Revenue Composition GROWTH ACROSS APPLICATIONS, WITH AUTO & INDUSTRIAL SEGMENTS GAINING SHARE AUTOMOTIVE CONSUMER & COMMUNICATIONS • 5G and IoT are unlocking multitude of use • Automotive remains strategic focus despite cases – smart cities, healthcare, etc. current slowdown (Covid impact
Slide 30: Sales – Customer Relations
30 Sales – Customer Relations CONTINUOUS INVESTMENT IN CUSTOMER RELATIONS; POTENTIAL FOR FURTHER EXPANSION IN US & EU Automotive Industrial Consumer NORTH AMERICA ASIA Driving applications Driving applications EUROPE S. KOREA Driving applications SUZHOU, CHINA JAPAN CARSEM TAIWAN Despite lots of hol
Slide 31: Sales – Pipeline
31 Sales – Pipeline DESPITE EXTERNAL CHALLENGES, CARSEM’s PIPELINE IS GROWING STEADILY Built customer confidence and reliability by Competitive pricing strategy to increase market delivering within timelines despite Covid-19 share challenges NEW PROJECT INTRODUCTIONS (#) Advanced R&D Infrastructure
Slide 32: Sales – Competitive advantages
32 Sales – Competitive advantages UNREPLICABLE NO DEBT, SUBSTANTIAL QUALITY STANDARDS & CASH ADVANCED R&D INFRASTRUCTURE OFFERINGS IN PROFITABLE COMPANY GROWTH AREAS INVESTMENT IN 49 YEARS IN SERVICE AUTOMATION Carsem’s competitive advantages Malaysian Pacific Industries Berhad
Slide 33: Technology – Automotive Segment
33 Technology – Automotive Segment INNOVATING IN LINE WITH STRATEGY TO BE GLOBALLY PREFERRED OSAT PARTNER FOR AUTOMOTIVE Major trends impacting semiconductor demand (Mobility disruptions) Electrification Autonomy Connectivity Novel battery technologies, growth of electrical Surge in autonomous drivi
Slide 34: Technology – Industrial Segment
34 Technology – Industrial Segment EXPANDING PORTFOLIO ALIGNED WITH TRENDS IN ADVANCED PACKAGING & TESTING FOR POWER Major trends impacting semiconductor demand Industry 4.0 Big Data Higher performing devices with greater functionality driving models that enable More servers with high power & high e
Slide 35: Technology – Consumer/Communications Segment
35 Technology – Consumer/ Communications Segment TAPPING INTO THE 5G REVOLUTION THROUGH ROBUST CUSTOM OFFERINGS Major trends impacting semiconductor demand 5G IoT High data rates, massive connectivity and ultra-low latency, catalyzing Need for combining functionalities – security, connectivity & mic
Slide 36: Technology – Immediate Focus: SiC
36 Technology–Immediate Focus SiC - UNLOCKING RF & POWER APPLICATIONS ✓ New high thermal conductivity and high operating temperature materials (pressure & pressure-less Ag Benefits of SiC over sintered paste, Cu nano paste) CARSEM previous gen materials ✓Wider bandgap, – via a dedicated materials IN
Slide 37: Technology – Future Focus
37 Technology–Future Focus BUILDING/ ACQUIRING CAPABILITIES FOR TECHNOLOGY & VALUE CHAIN UPGRADE MODULE/ SiP • Development focus on Front End Module/ SIP, and Custom SIP • Targeting several applications - 3G/ 4G/ 5G (FEM inside mobile phones), Consumer, Automotive, and Industrial • Aggressively look
Slide 38: Technology – Future Focus
38 Technology–Future Focus BUILDING/ ACQUIRING CAPABILITIES FOR TECHNOLOGY & VALUE CHAIN UPGRADE Design House • Looking to acquire a design house to introduce more Silicon Carbide technologies • System level circuit design for all the microelectronic devices In House NiPdAu Post Mold Plating • Devel
Slide 39: Technology – Carsem Technology Center
39 Technology – Carsem Technology Center DEDICATED TECHNOLOGY CENTER TO DRIVE INNOVATION & TECHNOLOGY DEVELOPMENT CARSEM TECHNOLOGY CENTER (CTC) – 4M APPROACH TO R&D MATERIAL METHODOLOGY • Materials lab, • Process development • Design & Simulation • Total Patents: 32 granted, 6 pending MACHINE MAN (
Slide 40: Quality & Productivity Focus
40 Quality & Productivity Focus INVESTING IN AUTOMATION & INDUSTRY4.0 TO ACHIEVE ZERO DEFECTS & HIGH PRODUCTIVITY GOALS End Game – Smart factory MPI CAPEX (RM million) Examples of Automation initiatives Vision capability improvement to screen Lights-off Factory - Automated Guided 5G Testing - Rack &
Slide 41: Quality & Productivity Focus: certifications
41 Quality & Productivity Focus CERTIFIED ON INDUSTRY’S LEADING PERFORMANCE PARAMETERS ESD Control ISO 14001:2015 Applicable to Design, Assembly, Testing Environmental Management System & Finishing of semiconductor component implemented in compliance IATF 16949:2016 Sony Green Partner Program Design
Slide 42: People – Employer of Choice
42 People – Employer of Choice ATTRACTING & RETAINING THE BEST TALENT IS AT THE CORE OF MPI’s VALUES We empower our people through We continue to care for our A strong value proposition to ownership and leadership employees & provide development become an employer of choice capabilities opportunitie
Slide 43: People – Caring for our Employees
43 People – Caring for our Employees COVID-19 VACCINATION FOR OUR EMPLOYEES AT CARSEM SUZHOU EMPLOYEE • Active fulfillment of our social responsibility – we organized vaccination & guidance for employees CARE • This is to build a safe Carsem by ensuring good health & wellness of our employees BUSINE
Slide 44: People – Caring for our Employees
44 People – Caring for our Employees CORONA VIRUS PRECAUTIONS AT OUR FACILITIES IN LINE WITH GOVERNMENT GUIDELINES Temperature check, hand sanitizer & face mask provided at entry Disinfected common area 3X/day Disinfecting buses 4 times a day Disinfecting production area 30 mins Social distancing of
Slide 45: Awards & Recognitions
45 Awards & Recognitions QUALITY & PEOPLE The Most Socially Responsible Enterprise in 2020 Suzhou Industrial Park Management Committee Asia’s Best Employer 2020 Excellent Supplier Silan Microelectronics Brands Award World HRD Congress Malaysian Pacific Industries Berhad
Slide 46: Table of Content
1 46 TABLE OF INTRODUCTION CONTENT 2 CORPORATE OVERVIEW 3 BUSINESS OVERVIEW 4 SUSTAINABILITY 5 GROWTH DRIVERS 6 FINANCIALS & SUMMARY
Slide 47: Financial highlights
47 Financial highlights Q3 FY21 SNAPSHOT Q3 FY21 Corresponding Revenue Higher by 44% and 40% in USD & RM respectively. REVENUE Sequential Revenue up by 10% in USD & 9% in RM PAT Q3 FY21 PAT 240% Higher against Q3 FY20 & 10% Higher against Q2 FY21. EPS Q3 FY21 EPS 224% Higher at 37.55c Vs 11.59c of Q
Slide 48: Key financial data
48 Key financial data MPI GROUP RESULTS AT A GLANCE Q3 FY21 Q2 FY21 Q3 FY20 Q3 vs Q2 Q3 vs Q3 YTD FY21 YTD FY20 YoY RM mil RM mil RM mil % % RM mil RM mil % Revenue 526.6 483.9 376.3 9% 40% 1,451.1 1,159.1 25% PAT 89.1 81.1 26.2 10% 240% 236.1 123.2 92% PATAMI 74.4 67.0 22.1 11% >100% 196.7 103.9 89
Slide 49: Key financial data
49 Key financial data MPI CREATED ANOTHER ALL TIME HIGH IN REVENUE & PAT IN Q3 FY21 MPI SEQUENTIAL & CORRESPONDING QUARTER GROWTH (Revenue in US$ million, PAT in RM million) • Despite the increase of raw material prices, MPI managed to deliver PAT growth of 240% - YoY (Q3 FY21 over Q3 FY20); and 10%
Slide 50: Cash
50 Cash MPI IS INCHING TOWARDS RM 1 BILLION CASH DESPITE CONTINOUS INVESTMENTS MPI NET CASH (RM million) grew by 15% YoY with 66% higher CAPEX during Q3 FY21 (Jan-Mar ’21) (vs. Q2 FY21 (Oct-Dec ’20)) 284 387 444 547 573 644 677 689 713 761 798 809 826 943 918 927 Jun-16 Dec-16 Jun-17 Dec-17 Jun-18 S
Slide 51: Investments
51 Investments CONTINUING STRATEGIC INVESTMENTS FOCUSING ON SENSORS, 5G TESTING & SILICON CARBIDE • Installing New Machines for Capacity Expansion SZ • Hire more people across the globe to support business CARSEM SITES 5G TESTING operations & sales • Invest in Research & Development to deliver lates
Slide 52: Investments
52 Investments CONSISTENT TECHNOLOGY INVESTMENTS TO REALIZE BUSINESS ASPIRATIONS MPI EBITDA VS CAPEX (RM MIL) SOME KEY INVESTMENT AREAS DURING Q3 FY21 WIFI6 / WIFI6E, both packaging and test RF IC related with 5G phones, Switch, LNA, Dual FEM module MPI CAPEX (RM MIL) Power Management IC, GaN – fast
Slide 53: Statement of Profit or Loss
53 Statement of Profit or Loss Q3FY21 Q3FY20 Changes RM '000 RM '000 % Revenue 526,628 376,289 40% Cost of sales (428,492) (330,023) 30% Gross profit 98,136 46,266 112% Operating expenses (20,084) (16,582) 21% Other operating income 19,416 3,639 434% Profit from operation 97,468 33,323 192% Interest
Slide 54: Statement of Financial Position
54 Statement of Financial Position 31/03/2021 30/06/2020 RM'000 RM'000 Non-current assets Property, plant and equipment 972,145 716,967 Right-of-use assets 39,494 42,921 Investment properties 29,012 29,709 Investments 46 46 1,040,697 789,643 Current Assets Inventories 153,310 117,118 Trade and other
Slide 55: Statement of Financial Position
55 Statement of Financial Position 31/03/2021 30/06/2020 RM'000 RM'000 Equity Share Capital 352,373 352,373 Reserves 1,463,544 1,192,350 Treasury shares (163,816) (163,816) 1,652,101 1,380,907 Non-controlling interests 281,560 238,233 Total Equity 1,933,661 1,619,140 Non-current liabilities Lease li
Slide 56: Summary
56 Summary MPI POSTED A RECORD Q3 FY21 MPI surpassed all time high revenue of Q2 FY21 and increased by 10% in Q3 FY21 YoY growth in Q3 revenue – 44% despite the ongoing tough times and market uncertainty Highest PAT in the history of MPI. A remarkable profitable YoY growth of 240% & QoQ growth of 10
Slide 57: Summary: Outlook Q4 FY21
57 Summary OUTLOOK Q4 FY21 Lingering market uncertainties & difficulties due to Corona Virus situation; Focus on delivering on our commitments despite Covid challenges thereby strengthening reliability The market demand outlook for semiconductor industry is looking favorable in the quarters ahead in
Slide 58: Thank You
58 Thank You Malaysian Pacific Industries Berhad
Malaysian Pacific Industries Berhad — Q3 FY2021 Earnings Presentation on 6ix