Solomon Systech International (2878) H2 2024 earnings summary

Executive summary

• FY2024 revenue fell 25.9% YoY to US$113.4m as shipments declined 12.7% to 293.2m units and average selling prices weakened; attributable profit fell 47.9% to US$10.1m.

• Gross margin improved to 33.5% from 30.3%, while large-display IC revenue and shipments each grew more than 50% YoY.

• Focus remains on electronic paper, automotive displays and differentiated, higher-value ICs, with several products targeted for validation or mass production during 2025.

Financial highlights

• Revenue was US$113.440m versus US$153.151m in 2023; gross profit was US$38.046m versus US$46.338m.

• Profit attributable to owners was US$10.130m versus US$19.443m; basic and diluted EPS were both 0.4 US cents versus 0.8 cents.

• Total expenses rose 6.5% to US$33.7m; R&D costs increased 4.9% to US$18.7m, or 16.5% of sales versus 11.6%.

• Operating cash flow was US$20.039m versus US$37.806m; cash and cash equivalents ended the year at US$104.242m.

Outlook and guidance

• 2025 plans include six- to seven-color electronic-label ICs targeted for mass production in H2, plus electronic-paper learning whiteboards and large color retail signage products entering mass production.

• A mini-LED backlight solution for automotive HUDs is expected to launch in H2 2025; the first automotive-specification integrated driver IC is also scheduled for 2025 mass production.

• P2P high-speed display IC prototypes are expected for validation in Q2 2025; a TFT-LCD human-interface platform is targeted for H2 mass production.

• Pricing pressure and supplier competition are expected to persist; wafer prices are expected to remain stable or decline. More resources are planned for differentiated, higher-value products.