Konfoong Materials International Co.Ltd(300666)
Financial statement report of 2021
During the reporting period, the financial department of Konfoong Materials International Co.Ltd(300666) (hereinafter referred to as “the company”) conducted financial accounting in strict accordance with the accounting standards for business enterprises, enterprise accounting system and accounting law. The annual financial statements prepared by the company were audited by Lixin Certified Public Accountants (special general partnership) and issued a standard unqualified audit report (xksbz [2022] No. zf10586). The financial statements of 2021 are reported as follows:
1、 Main financial indicators and their changes
1. Main accounting data and financial indicators
Unit: RMB
20212020 year-on-year increase or decrease 2019
Operating income (yuan) 159391265291116654263409 36.64% 82496479118
Net profit attributable to shareholders of listed companies
Run (yuan) 1066267382814716858370 – 27.55% 6418598625
Deduction attributable to shareholders of listed companies
Net profit of non recurring profit and loss (yuan) 76171693936064962547 25.59% 3376433484
Net cash flow from operating activities
Amount (yuan): 10290671842 -4554100528 325.96% 9462870441
Basic earnings per share: 29.67 yuan / share
Diluted earnings per share (yuan / share) 0.47 0.66 – 28.79% 0.29
Weighted average return on net assets: 8.77%, 17.15% – 8.38%, 9.95%
Year end 2021 year end 2020 year end increase or decrease over the previous year year end 2019 year end
Total assets (yuan) 290143634037237150281146 22.35% 146564289928
Net capital attributable to shareholders of listed companies
Output (yuan) 145671217889107711017719 35.24% 682640963
2、 Analysis of the company’s main business and operating conditions
(I) main business
The company’s main business is the R & D, production and sales of sputtering targets of ultra-high purity metal materials and key parts of semiconductor industry equipment, including aluminum targets, titanium targets, tantalum targets, copper targets and various ultra-high purity metal alloy targets. These products are mainly used in the physical vapor deposition (PVD) process of VLSI chips, liquid crystal panels and thin film Cecep Solar Energy Co.Ltd(000591) battery manufacturing, Used for preparing electronic thin film materials. At present, the company’s products are mainly used in semiconductors, flat panel displays and Cecep Solar Energy Co.Ltd(000591) batteries. In the field of high-purity metal targets for VLSI, the company has successfully broken the monopoly pattern of American and Japanese Multinationals and filled the gap in China’s electronic material industry. The key parts of the equipment machine in the semiconductor industry include precision parts made of metal, ceramics, resin and other materials through complex processes. They are mainly used in the machine of semiconductor chip and liquid crystal panel production line, covering application fields such as PVD, CVD, etching, ion implantation and industrial Siasun Robot&Automation Co.Ltd(300024) and so on. At present, China’s semiconductor industry urgently needs the localization of manufacturing equipment, Realizing the localization of parts and components is a national strategy to ensure the safety and healthy development of the industrial chain.
(II) main products
1. Ultra high purity aluminum target sputtering target
Ultra high purity aluminum and its alloys are one of the most widely used thin film materials for semiconductor chip wiring. In its application field, the manufacturing of VLSI chip requires the highest metal purity of sputtering target, which is usually more than 999995% (5n5). The metal purity of aluminum target for flat panel display and Cecep Solar Energy Co.Ltd(000591) battery is slightly lower, which is more than 99.999% (5N) and 99.995% (4n5) respectively.
At present, the aluminum targets produced by the company have been widely used in semiconductor chips, flat panel displays, Cecep Solar Energy Co.Ltd(000591) batteries and other fields. 2. Ultra high purity titanium sputtering target and ring
Ultra high purity titanium is one of the widely used barrier film materials in VLSI chips. Titanium ring is used in 130-55nm process and matched with ultra-high purity titanium target. Its main function is to achieve better film performance and higher integration requirements. At present, the titanium targets and rings produced by the company are mainly used in the field of VLSI chip manufacturing.
3. Ultra high purity tantalum target and ring
In the advanced copper process VLSI chip, ultra-high tantalum is the barrier film material. Tantalum and tantalum rings are necessary barrier film materials in the advanced manufacturing process of 90-5nm, because when applied in the most cutting-edge chip manufacturing process, tantalum target and its rings are the cutting-edge products with the highest technical difficulty in target manufacturing and the highest quality consistency requirements. Previously, tantalum targets and rings used in advanced manufacturing processes were only produced by a few multinational companies in the United States and Japan. In particular, the production technology of tantalum ring is extremely demanding. At present, only Konfoong Materials International Co.Ltd(300666) , Honeywell and Nippon mining have mastered the core technology of producing this product. In recent years, with the explosive growth of high-end chip demand, the demand for tantalum targets and rings has increased significantly, and the global supply chain is extremely tight.
At present, the tantalum targets produced by the company are mainly used in the field of VLSI.
4. Ultra high purity copper targets and rings
Ultra high purity copper, copper manganese and copper aluminum alloy targets are one of the most widely used thin film materials of leading semiconductor conductive layer at present. In its application field, the manufacturing of VLSI chip requires the highest metal purity of sputtering target, which is usually more than 999999% (6N). The metal purity of copper target for flat panel display and Cecep Solar Energy Co.Ltd(000591) battery is slightly lower, which is more than 99.999% (5N) and 99.995% (4n5) respectively. Copper and copper alloys as conductive layers are usually used in the leading chips of 90-3nm technology nodes. In particular, the manufacturing of copper manganese alloy target is very difficult. At present, only Konfoong Materials International Co.Ltd(300666) , Honeywell and rikuang have mastered the core technology of producing this product. In recent years, with the explosive growth of high-end chip demand, the demand for copper manganese alloy targets has increased significantly, and the global supply chain is extremely tight. The copper and copper alloy targets produced by the company are mainly used in the manufacturing of VLSI chips and flat panel displays.
5. Spare parts
Semiconductor devices such as VLSI chips PVD, CVD and etcher are composed of various precision parts. These parts mainly include transmission cavity, reaction cavity, chamber, ring assembly, cavity shield, protective disc, cooling arm, heater, gas distributor head, gas buffer sector, etc; Materials include metals (stainless steel, aluminum alloy, titanium alloy), non metals (ceramics, quartz, silicon, polymer materials), etc; The manufacturing process includes ultra precision machining, diffusion welding, argon arc welding, vacuum brazing, surface treatment, anodic oxidation, plasma spraying, thermal spraying, special coating, super purification and cleaning, etc. In the advanced chip manufacturing process, various precision parts and components, as well as retaining ring and pad for CMP, are widely used as consumables. The parts and components have high technical requirements for precision manufacturing technology of metal materials and special surface treatment technology. At present, the parts and components produced by the company are mainly used in the field of VLSI chips.
6. Other products
In addition to the above ultra-high purity metal targets and parts products, other products produced by the company include tungsten titanium targets, nickel targets, cobalt targets, chromium targets and other types of sputtering targets, as well as metal evaporating materials, carbon fiber composite components for LCD and other products. (III) main business models
1. Procurement mode
The company formulates a specific purchase plan according to the sales order and production plan, calculates the specific purchase quantity in combination with the existing inventory, purchase cycle, in transit time and other factors of main raw materials, and ensures a certain safety inventory. For the procurement of main raw materials, the company has established a stable raw material supply channel, formed a long-term and stable strategic partnership with major suppliers, and implemented procurement according to the formulated procurement plan; For the purchase of other raw materials, the company usually selects 2-3 qualified suppliers, establishes multiple supply channels, determines the suppliers after inquiry, and purchases and stores them in time. For Japanese suppliers, the company mainly purchases directly through its wholly-owned subsidiary, Japan Jiangfeng, and Japan Jiangfeng purchases high-purity metal raw materials from Mitsubishi Chemical’s comprehensive trading agency.
2. Production mode
As most of the end users of the company are world-class chip manufacturing enterprises, and each customer has unique technical characteristics and quality requirements, the company adopts a customized production mode according to the personalized needs of customers. The products developed and produced are different in material, composition, shape, size, performance parameters and many other aspects. The company’s production has the characteristics of “multi variety and small batch”. In the early stage of product R & D and design, the company should invest a lot of energy in communicating technology, quality and performance with end customers. When the products pass the customer evaluation, the production department will formulate the production plan according to the order after receiving the customer order from the sales department, and implement the production mode of “production based on sales”.
The company has mastered the core technology in the production of high-purity metals and sputtering targets, formed a complete business process including grain orientation control, material welding, precision processing, product testing, cleaning and packaging, and independently organized production and implemented flexible production management through rational allocation of machinery and equipment and production resources.
3. Sales model
As the downstream customers such as VLSI, flat panel display and Cecep Solar Energy Co.Ltd(000591) battery have strict requirements on the product quality and performance index of sputtering target, there is a strict supplier and product certification mechanism in the high-purity sputtering target industry. After the initial contact with potential customers, the company needs to go through the certification procedures such as supplier preliminary evaluation, product quotation, sample testing, small batch trial, stability testing, etc. before it can become a qualified supplier and supply goods in batches.
The company’s sales model with customers includes direct selling and agency sales model. Under the direct selling mode, after the company and its specific products have passed the customer certification and evaluation, the customer will place monthly or quarterly orders to the company, and the company will deliver goods to the customer according to the agreed delivery date. The agency mode of the company refers to the mode that the Japanese end customers of the company purchase products from the company through well-known companies such as the comprehensive trading company under Mitsubishi Chemical. This mode is more common in Japanese manufacturing enterprises. Its business process is that the final customer first signs a purchase contract with the comprehensive trading company, and then the comprehensive trading company signs a contract with the company. The company delivers goods to the warehouse designated by the comprehensive trading company according to the contract requirements, and the comprehensive trading company pays the goods to the company. After the establishment of Jiangfeng, a wholly-owned subsidiary of the company, the Japanese end customers of the company can also purchase directly from the company through Jiangfeng, Japan.
The current business model adopted by the company is determined according to the raw material supply of target products, production process and the market competition pattern of the industry in which the company is located. There is no significant change in the reporting period. During the reporting period, the company’s main business has been focused on the R & D, production and sales of high-purity sputtering targets. It is expected that the company’s business model will not change significantly in the future.
(IV) main performance drivers
Sputtering target is an essential raw material for electronics and information industry, liquid crystal display, optics and other industries, and then widely used in automotive electronics, smart phones, tablet computers, household appliances, microscopes, camera lenses and other terminal consumption fields. Therefore, the sputtering target industry is not easy to be affected by accidental or sudden factors, and can fully share the broad market of downstream industrial applications. With the continuous expansion and rapid development of terminal applications, strong consumer demand is conducive to driving the continuous expansion of sputtering target market. The company is mainly engaged in the R & D, production and sales of high-purity sputtering targets. Its main products are various high-purity sputtering targets, including aluminum targets, titanium targets, tantalum targets and copper targets, as well as semiconductor equipment parts. The company will seize market opportunities, continue to strengthen R & D and innovation, strive to improve the progressiveness, quality and cost performance of product technology, enhance market development and customer service capabilities, and improve operating revenue and net profit, Strive to become a world-class semiconductor material enterprise.
(V) main operating conditions during the reporting period
During the reporting period, the company achieved operating income of 15939127 million yuan, an increase of 36.64% over the same period of last year; The net profit attributable to shareholders of listed companies after deducting non recurring profits and losses was 761717 million yuan, a year-on-year increase of 25.59%; The net profit attributable to shareholders of listed companies was 1066267 million yuan, a decrease of 27.55% over the same period of last year. The main business conditions of the company are as follows:
1. More kinds of ultra-high purity metal sputtering targets applied in the advanced manufacturing process have been evaluated by customers and batch orders have been obtained
During the reporting period, significant progress was made in product market promotion. More types of targets such as ultra-high purity tantalum targets and rings, ultra-high purity copper and copper manganese alloy passed the evaluation of world-class customers, and the procurement volume continued to increase. In particular, the procurement volume of tantalum targets in TSMC, Hynix, Semiconductor Manufacturing International Corporation(688981) and other important customers increased significantly
