Sustained High Growth In Performance In The First Half Of 2021 The ...

On the evening of August 26th, Xinhai Technology released its performance report for the first half of 2021. The company realized sales revenue of 274.5826 million yuan, an increase of 72.26% over the same period last year. It realized 46.7327 million yuan of non-net profit belonging to shareholders of listed companies, up 15.72% over the same period last year. Net profit belonging to shareholders of listed companies in the first half of 2021 was 47.3489 million yuan, up 4.82% over the same period last year. After excluding the influence factors that have nothing to do with daily operation, the deduction of non-net profit belonging to shareholders of listed companies in the first half of 2021 was 70.3483 million yuan, an increase of 74.19% over the same period last year.

The impact of the epidemic has been diluted, not only the momentum of performance growth.

Founded in September 2003, as a full signal chain IC design enterprise integrating sensing, computing, control and connection, Xinhai Technology is the only integrated circuit design enterprise driven by analog signal chain and MCU platform among the domestic listed enterprises, and it is also one of the few integrated circuit design enterprises with the overall solution of the Internet of things.

The track where Xinhai Technology is located has a broad market space and prospects. According to the report of IC Insights, the global signal chain chip market is expected to reach 11.8 billion US dollars in 2023, and the global MCU market is expected to reach 23.9 billion US dollars in 2022.

In recent years, Xinhai science and technology has developed rapidly. Last year, Xinhai science and technology benefited from the influence of the epidemic pulling the demand for infrared temperature guns and other epidemic prevention materials, and the sales of infrared temperature measurement chips and modules increased rapidly, resulting in a high growth in the annual performance of 2020.

Due to the special reasons of the epidemic, it is generally believed that the performance growth driven by epidemic factors may not be sustainable in the long term, but in the first half of 2021, Xinhai Technology continued eight years of high-quality growth and delivered a gratifying answer. In addition, the results of the second quarter of 2021 announced at the same time by Xinhai Technology also continued to show an increasing trend. The revenue of Xinhai Technology in the second quarter was 170.986 million yuan, an increase of 65.83% over the same period last year; the month-on-month increase was 65.05%; and the non-net profit deducted by shareholders of listed companies in the second quarter of 2021 was 35.351 million yuan, an increase of 33.08% over the same period last year, and an increase of 210.60% over the same period last year.

Core Sea Technology's three major product line business adhering to the bright performance in 2020, multi-point flowering has made rapid breakthroughs and growth.

Specifically, health measurement AIOT chip business, due to the continuous growth of demand for health measurement equipment, AIoT equipment, etc., sales in the first half of the year totaled 112.7195 million yuan, an increase of 125.17% over the same period last year.

With the demand for medical infrared temperature measurement slowing down, and driven by the continuous growth of the demand for chips such as industrial measurement, pressure touch, smart home perception and analog AFE, the sales of analog signal chain chips totaled 51.5873 million yuan in the first half of the year, which increased by 196.05% over the same period last year (excluding the influence of infrared temperature measurement chip products in the first half of 2020).

Due to the rapid growth in communications and computers, mobile phones, industrial control, new energy management and other fields, the sales of MCU chips in the first half of the year totaled 106.6479 million yuan, an increase of 208.14% over the same period last year.

MCU has a strong momentum in many markets.

The growth of product line business is inseparable from Xinhai Technology to grasp the market space and continue to layout and expand new application markets. During the reporting period, the demand of Xinhai Technology continued to grow in many aspects, such as MCU, analog signal chain, full protocol fast charging chip application, health measurement AIOT and so on.

Among them, in terms of MCU products, the category of MCU products of Xinhai Technology continues to be rich, and 8-bit MCU maintains rapid growth in PD fast charging, e-cigarette, personal care, TWS headphones and other application fields.

It is particularly worth mentioning that the high-performance 32-bit MCU of Xinhai Technology began mass production in the first quarter of 2021, and achieved rapid growth in communications and computers (such as PC, optical modules, etc.), mobile phones, industrial control (motor control, industrial instruments, electrical equipment, sensors, etc.), lithium management in new energy, high-end consumption (such as wearable devices, high-end e-cigarettes, etc.), automotive central control, health and many other fields. Among them, in the computer application market, a number of special chips have been introduced, which are used in power supply, data interface, embedded control, human-computer interaction, and began to ship in batches.

With years of rich experience in signal chain, MCU and AIOT markets and stable and reliable product quality, in the first half of 2021, Xinhai Technology has continuously made new achievements in market expansion in many application fields, such as health measurement, TWS headphones, sensor applications, industrial testing and industrial control, vehicle navigation, optical modules, etc., and has reached cooperation with a number of high-quality industrial customers, and the product application fields have been continuously broadened.

Automotive chip is one of the markets deeply affected by the shortage of semiconductors in this round. Due to the shortage of MCU used in ESP (Electronic Stability Control system) and ECU (Electronic Control Unit), global automobile companies have been shut down one after another.

There are great gaps and challenges in domestic automotive chips, and automotive chips have gradually become the main "sticking neck" link in the development of China's automotive industry. Domestic MCU manufacturers, including Xinhai Technology, have launched the automotive market one after another. MCU, the first automotive gauge-level signal chain of Xinhai Technology, has successfully passed the AEC-Q100 certification, has been introduced into the new product design of automotive front-loading enterprises, and has been selected into the 2021 automotive electronic chip innovation product list, indicating that Xinhai's product reliability and quality have reached a new level.

In addition, with the help of the core products of high-precision ADC and high-reliability MCU, together with Hongmeng Zhilian and other industry common platforms, enabling AIoT, can connect the products of many home appliance manufacturers and smart hardware companies into a complete intelligent IoT system. In the first half of 2021, we continued to deepen our cooperation with Huawei Hongmeng and launched a Bluetooth solution based on Hongmeng Zhaopin. In terms of project cooperation, 76 reports have been completed, and more than 2 million chips connected to Hongmeng Zhaopin have been shipped during the reporting period.

The investment in R & D and talents has been continuously deepened, and the remarkable results have been recognized.

For semiconductor enterprises, R & D investment and talent reserve and construction are the cornerstones for enterprises to step into the track of rapid development. Xinhai Science and Technology points out that building the delivery ability and technological advancement of the R & D team is the foundation of Xinhai Science and Technology.

Jiwei found that since its inception, Xinhai Science and Technology attaches great importance to product research and development and insists on technological innovation. Since 2018, the company's R & D rate has basically been about 20%, leading in the listed companies of its peers.

In 2020, the R & D expenditure of Xinhai Science and Technology was 74.3915 million yuan, an increase of 45.62% over the same period last year, accounting for 20.51% of the company's operating income, and the number of R & D personnel reached 166, accounting for 64.09% of the company's total employees.

On this basis, in the first half of 2021, Xinhai Technology continued to invest strongly in R & D, reaching 64.0158 million yuan, accounting for 23.31% of revenue and an increase of 100.4% over the same period last year. The number of technical R & D personnel increased to 226, accounting for 69.11% of the company's total employees, an increase of 55.86% over the same period last year.

Continuously consolidate the foundation, for the core sea technology in the technical strength and market expansion blueprint for further considerable development, but also won the unanimous recognition of customers. Core Sea Technology has mastered many core technologies in the field of high-precision ADC and high-reliability MCU, including high-precision ADC design technology, high-reliability MCU design technology, low-temperature drift, high-precision reference technology, Bluetooth application technology, pressure touch technology, fast charging technology, battery charge monitoring technology and so on. Take the lead in providing one-stop solutions based on high-precision ADC, high-performance MCU, measurement algorithm and app, and have been adopted by customers A, Xiaomi and other head customers, becoming Huawei Hongmeng strategic partner.

Xinhai Technology has established a good cooperative relationship with industry benchmarking customers. Taking head customer An as an example, the company has carried out comprehensive cooperation with customer An in the fields of analog signal chain, MCU and health measurement AIOT, with more than ten cooperation projects. In the process of cooperation, fully understand the needs of customers, jointly innovate with customers, enhance differential competitiveness, technical strength and management capabilities have been recognized by customers and become their ecological partners.

Affected by the epidemic, the global semiconductor supply situation continues to deteriorate, but the domestic integrated circuit market demand is still strong. Due to the particularity of the integrated circuit industry, the concentration of wafer and closed test market is very high, single integrated circuit design enterprises often consider factors such as process stability and cost advantages, only individual wafer factories and closed test plants will be selected for cooperation.

In order to ensure the supply of production capacity, Xinhai Technology will strengthen exchanges with wafer manufacturing suppliers, establish a more stable and long-term in-depth cooperative relationship, ensure the long-term supply capacity and competitiveness of products, and alleviate capacity bottlenecks. In the closed test supply side, it has established a long-term and stable cooperative relationship with large closed test factories, actively maintained Synchronize and communication of production plans, effectively promoted the efficient operation of the industrial chain and cost control, and ensured the reliability and stability of products and services, thus ensuring the company's capacity supply and realizing the growth of both revenue and profit.

In the first half of 2021, the company applied for 8 domestic invention patents, obtained 17 domestic invention patents, 17 new utility model patents, 21 domestic utility model patents, 5 new software copyright applications, and 5 software copyright approvals.

By the end of the reporting period, the company had applied for a total of 436 invention patents (including 2 international patents), 145 authorized invention patents (including 2 international patents), 180 utility model patents and 139 authorized utility model patents; a total of 155 software copyrights were applied and 155 software copyrights were authorized.

Under the tide of domestic substitution, industry and automobile become the banner of the future.

Although the scale of China's analog chip market is huge, there is a big gap between the sales volume of domestic analog chips and the import volume. Driven by the trade friction between China and the United States, domestic end customers begin to pay attention to the security and stability of the supply chain and start the replacement of imported chips one after another. Local agents are keen on "domestic substitution" and actively seek cooperation with domestic chip manufacturers.

In the face of the unprecedented opportunity of domestic substitution, China's integrated circuit enterprises are ushering in a golden period of development. Domestic manufacturers represented by Xinhai Technology can cut into the market segment and replace imported products with better service and cost performance. It is expected that the market scale of domestic analog signal chain products and MCU products will continue to grow in the future.

In the first half of 2021, Xinhai Technology, which has blossomed in the field of pan-industrial applications, will focus on the industrial and automotive fields in the future, meet the needs of domestic substitution, cooperate deeply with benchmark manufacturers, and give full play to the synergy of industrial clusters.