UMS Holdings Q4 profit surges 166 per cent to S$15.83m on strong semiconductor sales

PRECISION manufacturer UMS Holdings reported a bumper year as strong semiconductor sales buoyed results for the fourth quarter of 2017, as well as for the full year.

Profit attributable to owners of the company for the fourth quarter ended Dec 31, 2017 rocketed 166 per cent to S$15.83 million, on the back of a 13 per cent rise in revenue to S$38.67 million.

For the full year ended Dec 31, 2017, the group recorded a 130 per cent boost in profit to S$52.04 million, on the back of a 56 per cent jump in revenue.

The surge came on the back of improved sales in Q4 2017, UMS said, and a higher proportion of component sales compared to Q4 2016.

Both segments of the group's semiconductor division showed improved results, with sales from its Semiconductor Integrated System division surging 73 per cent to S$87.4 million compared to S$50.5 million from the previous financial year, while component sales increased by 43 per cent to S$73 million from S$50.9 million in FY2016.

The group's US sales also increased 61 per cent from FY2016, while revenue in Malaysia more than tripled to S$6 million from the previous year and revenue marked "others" increased 12 per cent in the period under review.

UMS also benefitted from a 20 per cent decline in depreciation costs, a S$1.9 million gain on disposal of old equipment and a S$0.9 million write-back of past inventory provision.

Despite a dip in sales of 7 per cent compared to Q4 2016, however, UMS said that Singapore remains a major contributor, accounting for more than 60 per cent of the group's total sales in Q4 2017.

Earnings per share rose to 2.95 Singapore cents in Q4 2017, up from a restated 1.26 Singapore cents in the previous year-ago period.

Net asset value per ordinary share stood at 40.10 Singapore cents as at Dec 31, 2017, down slightly from 44.16 Singapore cents from the same period a year ago.

Along with its strong performance, the mainboard-listed company has proposed a final dividend of two Singapore cents per share and a special dividend of one Singapore cent per share.

Looking ahead, UMS expects "another record-breaking" year for the global semiconductor equipment market.

Augmented and virtual reality, artificial intelligence, cloud storage, smart automotive, smart manufacturing and smart medical technology (medtech) are expected to be just some applications driving global demand for semiconductors, UMS said, and are seen to be fuelling a semiconductor "super cycle".

Going forward, UMS will continue to "seek opportunities to diversify its business portfolio" to reduce dependency on its semiconductor segment, the group added.

UMS closed at S$1.14 on Tuesday, down one Singapore cent or 0.87 per cent.