AEM Holdings *Official* (SGX:AWX)

[Shion]

Analysts continue to like AEM's prospects following Intel news; UOBKH initiates 'buy'​

https://www.theedgesingapore.com/ca...ects-following-intel-news-uobkh-initiates-buy
Analysts from Maybank Securities and UOB Kay Hian are remaining positive on AEM Holdings after Intel announced that its 18A process node is six months ahead of schedule. The node is expected to be manufacturing ready by the 2HFY2024.

“This should help Intel regain manufacturing leadership. Intel said research and development (R&D) for the node is on or ahead of milestones, imbuing confidence it can begin manufacturing on this node in 2024,” says Maybank Securities analyst Lai Gene Lih.

Lai has kept his “buy” call on AEM with an unchanged target price of $6.34 on the back of the news.

“As we expect Intel to continue to be a sizeable AEM customer, we believe this news has long-term positive implications for Intel’s dominance and market share, and for demand for AEM’s equipment,” he adds.

Furthermore, Lai is upbeat on AEM’s outlook as he sees the company riding on Intel’s spending plans.

“We see the 2022 ramp-up of HDMI and HST test handlers as part of a capital expenditure (capex) replacement cycle within Intel. This means equipment demand from back-end capacity expansion - which follows front-end capacity additions – remains “untapped” and should underpin prospects in coming years,” he writes in his report on April 27.

As Intel builds up its front-end capacity across the US and Europe to reduce its chipmaking reliance on Asia, AEM is set to benefit from the trend as its back-end capacity will be required, adds Lai.

The company could also benefit from the equipment shipment around 2HFY2023 from Intel’s new Penang plant. The plant should begin operations in early FY2024, he continues.

On the potential supply disruptions arising from the Russia-Ukraine war, AEM has not seen any material direct impact from the war yet. It has, however, sought to mitigate risks by building up its inventory to ensure that there are enough supplies for future deliveries.

“AEM provides strong synergies like field-service capabilities and manufacturing scale for the high-tech companies that it acquires,” says Lai.

“Over time, we expect increasing contributions from non-Intel revenue sources,” he adds.

Upside swing factors include revenue growth from securing new customers, or via increased orders from its existing customers.

Synergistic and accretive acquisitions, as well as positive customer-related news flow are also potential catalysts to AEM’s share price.

Meanwhile, order cancellations, delays, lower-than-expected earnings, emerging technology from its rivals, are all downside risks to AEM.

UOB Kay Hian starts AEM at ‘buy’

UOB Kay Hian analyst Clement Ho has initiated “buy” on AEM Holdings with a target price of $5.60.

The target price implies 15.6x of AEM’s FY2022 earnings.

“Our valuation is at a premium to the Singapore peer average forward P/E of 10.1x. More direct competitors listed in the US and Japan trade at an average of 18.8x forward earnings,” Ho writes in an April 29 report.

Like Maybank’s Lai, Ho is positive on AEM as Intel’s March IDM 2.0 strategy is “a major bet that future demand and profitability lie in the packaging of modular dies (or chips)”.

These chips, which are also known as “tiles”, can squeeze in more computing in a single package.

“Driving towards that goal, Intel intends to build new fabrication plants (fabs) for these new ‘tiled’ chips, and is expected to outsource the production of certain modules. Existing capacity has also been earmarked for the foundry services market,” says Ho.

In addition, Intel’s decision to maintain old fabrication plants and build new ones will allow AEM to enjoy a steady demand for its consumables and services. The new fabs will lead to more orders for test equipment.

AEM’s acquisition of CEI will also lead to “meaningful” cost savings at around $5.6 million to $9.0 million a year as AEM can in-source some of its production activities to the latter.

“At the entity level, CEI is expected to also contribute $4.0 million a year of incremental net profit to the overall group. We believe our estimates are conservative as we have not factored in further upside from capacity expansion in CEI’s box-build business,” Ho writes.

In his estimates, Ho has not yet factored in new customers “from whom AEM expects more meaningful contributions from 2022 onwards”.

Shares in AEM closed 1 cent higher or 0.21% up at $4.82 on May 4.

 

[Shion]

AEM Q1 profit more than triples to $40.8m on record quarterly revenue​

https://www.straitstimes.com/busine...n-triples-to-408m-on-record-quarterly-revenue
SINGAPORE (THE BUSINESSS TIMES) - Semiconductor equipment maker AEM Holdings on Thursday (May 5) reported $40.8 million in net profit for its first quarter ended Mar 31, 2022, more than tripling from its $13.3 million profit recorded for the year-ago period.

The increase in net profit comes on the back of a record quarterly revenue of $261.9 million, which the electronic-services provider said was the highest in the group's history, up from $80.2 million a year ago.

Revenue growth was mainly driven by the strong uptake in the group's new-generation equipment and tools, and the consolidation of its subsidiary CEI, which the group acquired in H1 2021, AEM said.

Earnings per share stood at 13.1 cents in Q1 2022, a 172.9 per cent year-on-year increase from 4.8 cents in Q1 2021.

AEM said it has raised the group's revenue guidance for the full financial year to between $700 million and $750 million.

The group highlighted that today's new normal continues to create a "strong demand environment" for semiconductor chips for mission-critical applications. It intends to leverage industry trends and strengthen its capabilities to support next-generation applications through "superior" testing solutions, on top of investing in research and development.

AEM's chief executive officer Chandran Nair said: "We remain optimistic about our business prospects and strive to expand our market presence globally. While the growth in semiconductor test content provides positive momentum, we continue to remain mindful of the supply chain challenges and the geopolitical situation."

 

[Shion]

CGS-CIMB slashes AEM's TP by over 40% on fears of order deferments​

https://www.theedgesingapore.com/ca...lashes-aems-tp-over-40-fears-order-deferments
CGS-CIMB Research analysts William Tng and Izabella Tan have retained their “add” call on AEM Holdings as they see the company’s strength in system-level testing (handlers and complete testing solutions) as “intact”.

“[AEM’s] long-term prospects remain strong,” Tng and Tan write in their Oct 14 report.

However, the analysts have slashed their target price on the counter to $3.76 from $6.54 previously on the back of fears of order deferments.

Amid the news of US restricting exports of chips to China as well as reports of possible job cuts at AEM’s major customer Intel, AEM’s share price plunged by 21.5% to $3.25 on Oct 13 from $4.14 on Oct 7.

The potential loss of the China market, in terms of how much of Intel’s data centre-related (DC-related) chips could be affected by the sales ban, is a concern, the analysts note.

With AEM’s expansion plan on track, with its Penang plant expansion expected to come online between end-October to early-November 2022 and Intel’s new multi-phased expansion in Penang expected to begin production in early 2024, Intel has leeway to defer its orders for test handlers (THs) from AEM.

“We assume that such a deferment could occur over the FY2023 – FY2024 [ended Dec 31] and hence cut our sales assumptions for AEM by 6.7%-7.1%, leading to [a] 11.2%-11.8% decrease in our earnings per share (EPS) forecasts,” Tng and Tan write.

In their view, if the semiconductor industry is headed for decline in the FY2023, AEM’s valuations could revert to its six-year (FY2017- FY2022) average P/E multiple of 8.0x.

“However, we opine that AEM’s patented TH technology warrants some premium. Hence, we now value AEM at 9.7x (0.5 standard deviations or s.d. above its six-year average) on our reduced FY2023 EPS forecast given possible order deferments,” the analysts write. “Previously we used 14.9x (+2 s.d. above its six-year average).”

To them, stronger-than-expected orders from AEM’s major customer and earlier-than-expected success in securing orders from other potential customers are re-rating catalysts to its share price. On the other hand, delivery delays and the loss of its sole supplier status which will negatively affect AEM’s profitability, are downside risks.

On Oct 14, AEM lifted its revenue guidance for the FY2022 to between $820 million and $850 million from its previous guidance of $670 million to $720 million on the back of increased demand from its new and existing customers.

Shares in AEM closed 7 cents lower or 2.2% down at $3.11 on Oct 17.

 

[Shion]

AEM reports 3QFY2022 earnings of $32.2 million, up 38.3%​

https://www.theedgesingapore.com/capital/results/aem-reports-3qfy2022-earnings-322-million-383
Semiconductor tester AEM Holdings has reported earnings of $32.2 million for 3QFY2022, up 38.3 y-o-y. Revenue in the same period was up 41% to $206.1 million.

With these 3Q numbers, the company’s earnings for 9MFY2022 has increased by 117.6% y-o-y to $115.3 million, on the back of a 120.6% increase in revenue to $746.6 million.

AEM attributes the growth in top and bottom line were achieved on the back of a volume ramp up from new and existing customers for its system level testing handlers. Contributions from CEI, which AEM acquired in March 2021, helped too.

According to AEM, the industry is entering “an interesting time” with near term recessionary concerns counter-balanced with unprecedented mid-term government-backed capital investments globally.

“While we remain cognizant of near-term risks given the recessionary concerns, we believe that the mid- to long-term outlook remains strong,” says CEO Chandran Nair.

“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.

“Given our success with our key customer and recent program wins with new customers, we continue to invest in R&D to release industry-leading Test 2.0 platforms. We also remain diligent in managing our costs and production efficiency,” he adds.

AEM shares closed at $3.35 on Nov 4, up 3.72% for the day, but down 36.07% year to date.

 

[Shion]

CGS-CIMB sees AEM's 'possible recovery' from 2HFY2023 and potential earnings recovery for FY2024​

https://www.theedgesingapore.com/ca...very-2hfy2023-and-potential-earnings-recovery
CGS-CIMB Research analysts William Tng and Izabella Tan have kept their “add” call on AEM Holdings AWX -2.01% as they see a potential earnings recovery to happen for the company in the FY2024. However, they estimate that the company’s earnings per share (EPS) for the FY2023 will decline by 29.3% y-o-y.
In their March 17 report, the analysts have also kept their target price unchanged at $3.86 after shares in the company fell by 18.3% to $2.76 on March 1, just days after its FY2022 results were announced on Feb 24. Before the announcement, AEM’s shares were trading at around $3.38.

“Our TP is based on 9.5x FY2024 P/E, 0.5 standard deviations (s.d.) above its six-year average given its sole supplier status with its major customer,” write Tng and Tan.

For the FY2022 ended Dec 31, 2022, AEM’s earnings stood at $126.8 million, 38% lower y-o-y. While the company’s FY2022 stood at its highest annual figure at $870.5 million, exceeding its full-year revenue guidance, its target revenue guidance of $500 million for the FY2023 was deemed conservative.

On the share price decline, Tng and Tan believe that the market has priced in a weaker performance for the FY2023. At its current share price of $2.99, AEM’s shares are currently trading at 7.35x of Tng and Tan’s FY2024 earnings per share (EPS) forecast, or 7.0% below its six-year average of 7.9x.

In FY2023, Tng and Tan remain fairly positive on AEM’s prospects, believing that its management will “oversee its costs diligently” given the industry slowdown in the year.

The analysts add that AEM’s legal and professional fees should decline “significantly” in the FY2023. The company had seen a $15.9 million increase in its legal and professional fees in the FY2022 that came from the arbitration involving its US entities in February 2022 and from the IT security breach in September 2022.

Despite the conservative revenue outlook in FY2023, Tng and Tan see a possible recovery happening for the company from the 2HFY2023 onwards. At its briefing, AEM’s management said that its revenue guidance of $500 million may be revised as visibility for its 2HFY2023 becomes clearer.

It added that revenue for the semiconductor industry could possibly rebound between the 2HFY2023 and early FY2024. Its growth trajectory may even reach the US$1 trillion ($1.34 trillion) mark by the 2030s driven by high performance computing, artificial intelligence, electrification of vehicles, and 5G communications, note the analysts.

“Management thinks that these customers’ revenue could possibly double in FY2023 versus FY2022 and is optimistic that there could be secular growth opportunities from these customers in FY2024 and beyond,” write Tng and Tan.

To them, stronger-than-expected orders from AEM’s major customer and an earlier-than-expected success in securing orders from other potential customers are re-rating catalysts while delivery delays and the loss of the sole supplier status for its major customer, which would negatively affect AEM’s profitability, are downside risks.

As at 4.33pm, shares in AEM are trading 6 cents lower or 2.01% down at $2.93.

 

[hound297]

千防万防，家贼难防。

 

[yslvlys]

Wow must be serious fraud?

 

[Shion]

Sias presses AEM for more details on inventory shortfall, financial impact​

https://www.straitstimes.com/busine...tails-on-inventory-shortfall-financial-impact

SINGAPORE - The Securities Investors Association (Singapore), or Sias, is pressing AEM Holdings for more details on an inventory shortfall that is expected to hit the semiconductor equipment maker’s fourth-quarter earnings.

The shortfall, first disclosed on Jan 14, is estimated to be between $17.9 million and $25.1 million. It was caused by human error in transactions with AEM’s enterprise resource planning system, the company said on Jan 22, adding that its fourth-quarter 2023 profit before tax would be adjusted.

In an e-mail to AEM’s chief executive Chandran Nair and its board on Jan 23, Sias president David Gerald called on the company to “clearly state” the potential financial impact on earnings for the full year ending Dec 31, 2023.

“Can the board (and) management confirm that there are no other discrepancies in the group’s financial statements and financial position?” he questioned, also asking if shareholders can still rely on unaudited financial statements for the six months ended June 30.

Mr Gerald also called for more details on the reasons for the internal stock-taking exercise through which the shortfall was discovered.

“For example, was it a routine exercise or were there any whistle-blowing reports, negative findings from the internal audit or did the group face challenges in fulfilling customers’ orders? When was the board and management first informed of the shortfall?” he questioned.

He also asked what level of oversight was provided by the audit committee after the discovery of the shortfall, and how it concluded that the shortfall was the result of human error.

Mr Gerald further queried when AEM’s audit committee will complete its review of the company’s stock monitoring processes and systems.

“When was the last time the internal audit assessed the risk management controls and procedures pertaining to inventories? What proactive steps are being taken to prevent the recurrence of similar situations in the future?” he asked.

Other questions posed by Mr Gerald were:
- How does the overstatement or shortfall in inventories affect the remuneration (including cash bonuses, stock options etc) of senior executives?
- Can management also provide greater clarity on how the shortfall in inventories may affect operations, such as the order fulfilment schedule or the onboarding of new customers?
- Does the audit committee intend to carry out a comprehensive review of the adequacy of the group’s internal controls?
- Can the board elaborate on the measures and protocol in place to enforce accountability within the group?

“Your kind response to our questions above will help your shareholders to understand the issues better. We should also be happy to discuss the above questions,” Mr Gerald told AEM’s management in his e-mail.

AEM shares ended Jan 23 at $2.91, up $0.06 or 2.1 per cent. THE BUSINESS TIMES

 

[manutd168]

Broke 52 week lows yesterday……waiting for $2 durians ……but plenty of time as market awaits FY results due only end month…… meanwhile the silence from the insiders is deafening……..

Now $1.83

 

[TehSi99]

Now $1.83

Wah. Low gets lower.
Still a steal or gg?

 

[manutd168]

Wah. Low gets lower.
Still a steal or gg?

I buy 100 shares only
Just to beo it daily

 

[Shion]

AEM Holdings 1QFY2025 profit before tax down 71.3% q-o-q to $3.8 mil​

https://www.theedgesingapore.com/ca...ngs-1qfy2025-profit-tax-down-713-q-o-q-38-mil

AEM Holdings has reported a profit before tax of $3.8 million for the 1QFY2025 ended March 31, 2025, down 71.3% q-o-q. This was however higher than the $2.7 million profit before tax reported in 1QFY2024.

The group reported a revenue of $86.03 million for the quarter, a 35.1% q-o-q decrease for 1QFY2025.

The group’s profit before tax margin for 1QFY2025 came in at 4.4%.

AEM says that the sequential drop in revenue reflects the pull-in of orders by one of the group’s customers from FY2025 into 2H2024.

The reduction of revenue was counteracted by the group’s success in moving into high volume manufacturing at its major new AI/ High-Performance Compute (HPC) anchor customer.

Its Test Cell Solutions (TCS) segment saw a 46.9% revenue decline q-o-q primarily driven by the pull-in of orders by one of the group’s customers from FY2025 to the 4Q2024 for inventory management purposes.

Contract Manufacturing, which accounts for 37.7% of the group’s revenue in 1QFY2025, decreased slightly by 2.7% q-o-q.

At the end of March, the group’s net assets were valued at $492.4 million, up $0.1 million from the previous quarter.

The group’s cash and cash equivalents stood at $42.23 million, down 3.5% y-o-y.

The group’s revenue guidance for 1HFY2025 is maintained at $155 million to $170 million, despite the uncertainty created by the current tariff situation.

AEM says that it remains confident in its long-term growth prospects and its differentiation in thermal technology, which is a critical enabler for testing AI/HPC devices and chiplet-based advanced packages.

Shares in AEM Holdingsclosed 5 cents higher or 4.31% up at $1.21 on May 13.

 

[TehSi99]

AEM Holdings 1QFY2025 profit before tax down 71.3% q-o-q to $3.8 mil​

https://www.theedgesingapore.com/ca...ngs-1qfy2025-profit-tax-down-713-q-o-q-38-mil

AEM Holdings has reported a profit before tax of $3.8 million for the 1QFY2025 ended March 31, 2025, down 71.3% q-o-q. This was however higher than the $2.7 million profit before tax reported in 1QFY2024.

The group reported a revenue of $86.03 million for the quarter, a 35.1% q-o-q decrease for 1QFY2025.

The group’s profit before tax margin for 1QFY2025 came in at 4.4%.

AEM says that the sequential drop in revenue reflects the pull-in of orders by one of the group’s customers from FY2025 into 2H2024.

The reduction of revenue was counteracted by the group’s success in moving into high volume manufacturing at its major new AI/ High-Performance Compute (HPC) anchor customer.

Its Test Cell Solutions (TCS) segment saw a 46.9% revenue decline q-o-q primarily driven by the pull-in of orders by one of the group’s customers from FY2025 to the 4Q2024 for inventory management purposes.

Contract Manufacturing, which accounts for 37.7% of the group’s revenue in 1QFY2025, decreased slightly by 2.7% q-o-q.

At the end of March, the group’s net assets were valued at $492.4 million, up $0.1 million from the previous quarter.

The group’s cash and cash equivalents stood at $42.23 million, down 3.5% y-o-y.

The group’s revenue guidance for 1HFY2025 is maintained at $155 million to $170 million, despite the uncertainty created by the current tariff situation.

AEM says that it remains confident in its long-term growth prospects and its differentiation in thermal technology, which is a critical enabler for testing AI/HPC devices and chiplet-based advanced packages.

Shares in AEM Holdingsclosed 5 cents higher or 4.31% up at $1.21 on May 13.

Thanks for sharing.

I have enough losses investing in such Sg listed stocks. Many are cmi in the end.

 

[Shion]

AEM Holdings CEO Amy Leong to be replaced by CTO Samer Kabbani​

https://www.theedgesingapore.com/ne...s-ceo-amy-leong-be-replaced-cto-samer-kabbani

Amy Leong, CEO of AEM Holdings, has resigned, having served just one year in this role.

Samer Kabbani, currently president and chief technology officer of the company, will take over with effect from Monday, July 28.

In an SGX filing, AEM says Leong is leaving her role because of "board-led leadership realignment for growth."

AEM's chairman, since 2011, is Loke Wai San, whose investment firm Novos Tellus was a key investor in AEM.

Leong took over from previous CEO Chandran Nair, who served as the CEO between July 2020 and June 2024.

Kabbani has been with the company since Sept 2020 and has led the company's next-generation test technology roadmap.

He was previously executive vice president at Advantest and Astronics Test Systems, respectively.

As described in AEM's website, Kabbani "is a prolific innovator with more than 30 registered patents in areas of advanced thermal management, photoresist processing, factory automation, and vision alignment and inspection."

AEM shares closed at $1.72 on July 25, up 1.78%, following a higher price target call by DBS amid an overall bullish market.

From an earlier target price of $1.50, Amanda Tan and Ling Lee Keng of DBS now rate this counter as worth $2.10.