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ASMI plans expansion as it sees more interest in chips

Stock MarketsSep 28, 2021 18:38
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© Reuters.

By Anait Miridzhanian

(Reuters) -Dutch semiconductor equipment maker ASM International plans to step up innovation and production, it said on Tuesday, predicting the digitalisation of everyday life would drive a big increase in the usage of chips.

Groups like ASMI and peers ASML and BESI are benefiting from global demand for semiconductors used in products ranging from cars to computers and smartphones.

The firm, which makes equipment used to deposit atom-thin layers of material on computer chips during their manufacturing process, said it was planning to expand sites in Finland, the United States and South Korea.

It also said it would expand its manufacturing facility in Singapore with an aim to make it production-ready by early 2023.

ASMI did not say how much it would spend on the expansion.

"There could be sovereign government efforts that might add further investments but that's something that is still in the works, nothing has been fully confirmed yet", Chief Executive Benjamin Loh said during the company's first investor day.

To tackle a chip shortage that has exposed its dependence on Asia, the European Union is pushing for multibillion-dollar investments to double its share of global chip production over the next decade.

Chief Financial Officer Paul Verhagen also said ASMI was scanning the market for merger and acquisition opportunities.

The firm forecast annual revenue of 2.8-3.4 billion euros ($3.3-4.0 billion) by 2025, up from 1.3 billion euros in 2020, with a gross margins of 46%-50% between 2021 and 2025.

It also raised its third-quarter order intake guidance to over 600 million euros from 510-530 million previously, boosted by strong demand in the logic and foundry sector.

ASMI, which reduced greenhouse gas emissions by 15% between 2016 and 2020, is aiming for net zero emissions by 2035 and to use 100% renewable electricity by 2024.

The company expects fourth-quarter revenue to be higher than in the third if there are no new supply chain issues, adding that in October it will have a better view.

($1 = 0.8537 euros)

ASMI plans expansion as it sees more interest in chips
 

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