AEM reports higher revenue, net profit for Q3 2022

AEM Holdings reported a 41 per cent jump in Q3 2022 revenue to S$206 million, from S$146 million a year prior, in a bourse filing on Friday (Nov 4).

Net profit for the quarter grew in tandem, up 38.3 per cent to S$32.2 million, from S$23.3 million in the previous year. The topline and bottomline growth were driven by a ramp-up in volume from new and existing customers of AEM’s systems-level testing handlers and peripheral tools. Contributions from CEI, acquired in March 2021, also powered the semiconductor testing company’s growth.

The company is investing in a longer-dated purchase order backed programme of about S$280 million, resulting in an increase of inventories from S$204.9 million as of Dec 31, 2021 to S$322.5 million as of Sep 30, 2022. Cash and cash equivalents have also reduced to S$153.6 million as of Sep 30, 2022, from S$216.2 million as of Dec 31, 2021.

Revenue guidance for FY2022 is maintained between S$820 million and S$850 million on the back of strong demand from customers.

The semiconductor industry is encountering near-term recessionary concerns, as government-backed capital investments have surged. With the investments into next-generation semiconductor nodes and advance packaging technologies, AEM believes that these new developments will require new test methodologies that the company can support.

The migration to the new test methodologies will drive capital expenditure from AEM’s customers as well as come with a higher percentage of test consumables which the company has been investing in.

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“While we remain cognizant of near-term risks given the recessionary concerns, we believe that the mid- to long-term outlook remains strong. Our conviction is further strengthened by customers’ feedback and their confidence in placing our solutions in the critical path of their next-generation product launches,” said Chandran Nair, chief executive officer, AEM.

Shares of AEM closed S$0.12 or 3.7 per cent higher at S$3.35 on Friday.