Powerchip Semiconductor Manufacturing (6770) Q2 2024 earnings summary

Executive summary

• Revenue for the six months ended June 30, 2024 was NT$21,943 million, down 2% year-over-year; net loss was NT$2,397 million compared to net income of NT$804 million in the prior year period.

• Gross margin declined to 10% from 18% year-over-year, reflecting higher cost of revenue and increased operating expenses.

• Operating loss for the six months was NT$3,300 million, compared to operating income of NT$268 million a year ago.

• Cash and cash equivalents at June 30, 2024 were NT$31,074 million, down from NT$45,432 million at June 30, 2023.

• The company’s financial statements received an unqualified review for 2024; 2023 results were qualified due to unreviewed non-significant subsidiaries.

Financial highlights

• Operating revenue for Q2 2024 was NT$11,123 million, nearly flat year-over-year.

• Net loss for Q2 2024 was NT$1,958 million, compared to net income of NT$617 million in Q2 2023.

• Basic loss per share for the six months was NT$(0.58), compared to earnings per share of NT$0.20 in the prior year period.

• Cash flow from operations for the six months was NT$2,225 million, a turnaround from negative NT$557 million in the prior year.

• Capital expenditures for property, plant, and equipment were NT$12,151 million in the first half of 2024.

Outlook and guidance

• Management expects to reach the carbon fee threshold in 2024, but the financial impact is not yet estimable due to pending regulations.

• The company continues to monitor the impact of new and upcoming IFRS standards, with no material effect expected from those adopted in 2024.