JCET Will Continuously Focus on R&D and Resource Investment, Preparing for Future Market Growth

Q1 2023 Financial Summary：

• Revenue was RMB 5.86 billion.
• Generated RMB 1.23 billion cash from operations. With net capex investments of RMB 0.81 billion, free cash flow for the quarter was RMB 0.42 billion.
• Net profit was RMB 0.11 billion. Earnings per share was RMB 0.06.

Shanghai, China, April 25, 2023 - JCET Group (SSE: 600584), a leading global provider of integrated circuit (IC) manufacturing and technology services, today announced its financial results for the first quarter of 2023. According to the financial report, in Q1 2023 JCET achieved revenue of RMB 5.86 billion, and net profit of RMB 0.11 billion.

Consumer electronics demand has been weak causing chip companies to accumulate high inventory levels and face increasing market pressure. In order to actively and effectively respond to market changes, JCET continuously invests in high-performance, advanced packaging technology, and in fields with continuously growing demand such as automotive electronics, industrial electronics, and high-performance computing, to prepare for a new round of application demand growth.

In recent years, JCET focused on technology development and has achieved HVM of advanced packaging technologies such as system level (SiP), wafer level, and 2.5D/3D. In Q1 2023, the proportion of advanced packaging revenue in the company's revenue continuously exceeded 60%, becoming the "ballast stone" for the company's development. JCET invested RMB 1.31 billion in R&D in 2022, a year-on-year increase of 10.7%; in the first quarter of this year, R&D investment was RMB 0.31 billion, accounting for 5.3% of revenue. JCET has made breakthroughs in the field of chiplet technology, achieving ultra-large high-density fan-out flip chip heterogeneous integration of multiple chips in packages as large as 102mm x 102mm. It is also supported with a complete set of turnkey services from design to production, providing excellent microsystem integration solutions for high-performance computing applications.

 In the field of automotive electronics, the company accelerates the R&D of advanced packaging technologies related to electric vehicles and autonomous driving with high-reliability standards, as well as the development of next-generation power device modules and other products, enhancing the differentiated competitiveness of advanced technologies and services and implementing them at their factories. In Q1 2023, the revenue of automotive electronics continued to grow with a year-on-year increase of 144%.

In 2023, JCET will maintain a reasonable level of growth in total capital expenditure, expanding production capacity to meet customer needs, while actively expanding the company's investment in R&D, infrastructure, technological innovation, and factory automation upgrades.

Mr. Li Zheng, CEO of JCET said, “The combination of several factors has resulted in a sustained downturn in the semiconductor market. Although the short-term performance is under pressure, JCET will continuously adhere to the strategy of promoting international and domestic business, increase investment in cutting-edge technology and resources, and focus on higher-level packaging technologies such as automotive electronic chips and diversified solutions for chiplet. The company will carry out forward-looking infrastructure, R&D, and strategic production capacity expansion, accelerate the product development and market promotion mechanisms centered on intelligent solutions, explore market demand with greater potential for future development, and provide high-quality production technology services to global customers.”

For more information, please refer to the JCET Q1 2023 Report.