AEM Holdings AWX has reported earnings of $43.9 million in 2HFY2022, down 30% y-o-y while earnings for the full year grew by 38% y-o-y to $126.8 million.
Revenue for the 2HFY2022 was down 11.6% to $330 million. Meanwhile, the company recorded highest annual revenue at $870.5 million for FY2022, up 53.9% y-o-y. This exceeds its revenue guidance for the full year of between $820 million and $850 million on the back of strong demand from existing and new customers.
AEM’s Test Cell Solutions segment grew 57% y-o-y to an all-time high of $682.7 million in FY2022, spurred by a strong ramp in demand by its key customer for both equipment and consumables. This demand was driven in part by a pull-in from 2023 for capacity needs.
Gross profit for 2HFY2022 stood at $107.4 million, down 11% y-o-y while the gross profit for the full year grew 47% to $273 million.
Gross profit margin decreased from 33% in FY2021 to 31% in FY2022 mainly due to increasing cost pressure from supply chain challenges and product mix.
Research and development (R&D) expenses increased to $23.1 million, approximately 2.7% of revenue. AEM has stepped up its investment in R&D activities and capabilities to stay ahead of competition, although the R&D expenses as a percentage of revenue has decreased due to the significantly higher revenue in FY2022 as compared to FY2021.
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The company is investing in longer dated, non-cancellable purchase orders, equivalent to $280 million. As a result, it recorded an increase in inventories from to $367.7 million as at Dec 31.
On the other hand, cash and cash equivalents were reduced from $216.2 million as at end December 2021 to S$127.8 million as at end of last year.
AEM has proposed a final dividend of 3.6 cents per share. Together with the interim dividend of 6.7 cents per share, the total dividend for FY2022 is 10.3 cents per share.
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Given the limited visibility and anticipated volatility within the industry, AEM is providing a target revenue guidance for FY2023 of $500 million, which may be revised as second half visibility becomes clearer.
Its CEO Chandran Nair says the company realises that 2023 will have its share of challenges that will require agility in its operational capabilities. “The deep engagements with our customers give us confidence that our Test 2.0 vision is required for them to meet the challenges emerging from their next generation products, which will result in secular growth for AEM,” he adds.
Shares in AEM closed at an unchanged $3.38 on Feb 24.
