JCET Continues Solid Growth Momentum in Q1 2022

Continued Optimization of Product Portfolio and Focus on High Value-Added Applications

Q1 2022 Financial Highlights：

Revenue was RMB 8.14 billion,an increase of 21.2% year on year. A record high first quarter in the company's history.

Generated RMB 1.64 billion cash from operations,an increase of 36.1% year on year. With net capex investments of RMB 0.87 billion,free cash flow for the quarter was RMB 0.77 billion.

Net profit was RMB 0.86 billion,a record high first quarter in the company's history.

Earnings per share was RMB 0.48,as compared to RMB 0.24 in Q1 2021.

SHANGHAI,April 30,2022 -- Today,JCET (SSE: 600584),a leading global provider of integrated circuit (IC) manufacturing and technology services,announced its financial results for the first quarter of 2022. The financial report shows that the company had a positive start in 2022,achieving revenue of RMB 8.14 billion in the first quarter,up 21.2% year-on-year,and net profit of RMB 0.86 billion,both record high first quarter in the company's history.

As IC back-end manufacturing technology continues to develop in the direction of high density and low power consumption,various IC packaging solutions provide higher added value to the semiconductor industry. JCET managed well the market fluctuations and challenges by continuously optimizing its product portfolio and focusing on high value-added applications. JCET improved its market competitiveness,which was widely recognized and affirmed by customers.

JCET proactively took various preventive solutions and control measures to protect its employees' health and safety and maintain operation continuity under the current Covid-19 situation. In addition,JCET took corporate social responsibility actions and was involved deeply in local community anti-pandemic activities through charitable donations and other means. These activities contributed to our local communities and supported economic growth.

"The growth of demand for market innovation will drive the steady growth of IC back-end manufacturing market in the coming years," said Mr. Li Zheng,Chief Executive Officer of JCET. "JCET is focusing on high value-added market application areas such as automotive electronics,power devices,and high-performance computing. This will expand our technology advantages and mass production competitive advantages that we accumulated over the years in the fields of high-density wire bond package,system-in-package,wafer level packaging,high-reliability discrete devices,etc. We strive to overcome the market fluctuations and supply chain uncertainties under the current Covid-19 pandemic situation. JCET will continue to provide high-quality production and technology services to our customers." Mr. Li Zheng added "JCET announced the implementation of an equity incentive plan for employees for the first time in the company's 19 years of history. The plan will drive sustainable growth,secure shareholders' interests,and motivate our employees. With the strong support from our customers,shareholders,and partners,we have a high sense of responsibility and strong confidence for the company's future development."

For more information,please refer to the JCET Q1 FY2022 report.

CONSOLIDATED BALANCE SHEET (Unaudited)

RMB in millions

Mar 31,2022

Dec 31,2021

ASSETS

Current assets

Currency funds

2,512

2,761

Trading financial assets

3,290

2,670

Derivative financial assets

2

5

Accounts receivable

3,945

4,271

Receivables financing

36

28

Prepayments

242

183

Other receivables

77

77

Inventories

3,264

3,193

Assets classified as held for sale

99

Other current assets

84

130

Total current assets

13,452

13,417

Non-current assets

Long-term receivables

37

38

Long-term equity investments

765

770

Other equity investments

448

418

Investment properties

92

93

Fixed assets

18,297

18,424

Construction in progress

574

661

Right-of-use assets

588

622

Intangible assets

432

447

Goodwill

2,014

2,023

Deferred tax assets

187

185

Other non-current assets

1

1

Total non-current assets

23,435

23,682

Total assets

36,887

37,099

LIABILITIES AND EQUITY

Mar 31,2021

Current liabilities

Short-term borrowings

1,633

2,193

Derivative financial liabilities

6

2

Notes payable

527

579

Accounts payable

4,893

5,298

Contract liabilities

453

458

Employee benefits payable

872

1,062

Taxes and surcharges payable

273

235

Other payables

375

414

Liabilities classified as held for sale

45

Current portion of long-term liabilities

1,256

1,052

Other current liabilities

3

3

Total current liabilities

10,291

11,341

Non-current liabilities

Long-term borrowings

3,791

3,751

Bonds payable

Lease liabilities

528

568

Long-term payables

Long-term employee benefits payable

19

20

Deferred income

338

337

Deferred tax liabilities

99

82

Total non-current liabilities

4,775

4,758

Total liabilities

15,066

16,099

Equity

Paid-in capital

1,780

1,780

Capital reserves

14,986

14,984

Accumulated other comprehensive income

(314)

(281)

Surplus reserves

174

174

Unappropriated profit

5,195

4,334

Total equity attributable to owners of the parent

21,821

20,991

Minority shareholders

9

Total equity

21,821

21,000

Total liabilities and equity

36,099

CONSOLIDATED INCOME STATEMENT (Unaudited)

RMB in millions,except share data

Three months ended

Mar 31,2022

Mar 31,2021

Revenue

8,138

6,712

Less: Cost of sales

6,599

5,636

Taxes and surcharges

16

20

Selling expenses

49

49

Administrative expenses

258

230

Research and development expenses

322

258

Finance expenses

23

96

Including: Interest expenses

43

110

Interest income

7

5

Add: Other income

56

41

Investment income / (loss)

12

(2)

Including: Income / (loss) from investments in associates and joint ventures

(5)

(2)

Gain / (loss) on the net position hedging

(2)

Gain / (loss) on changes in fair value of financial assets/liabilities

3

Credit impairment (loss is expressed by "-")

(7)

4

Asset impairment (loss is expressed by "-")

1

(28)

Gain / (loss) on disposal of assets

15

6

Operating profit / (loss)

951

442

Add: Non-operating income

5

Less: Non-operating expenses

2

Profit / (loss) before income taxes

956

440

Less: Income tax expenses

95

53

Net profit / (loss)

861

387

Classified by continuity of operations

Profit / (loss) from continuing operations

861

387

Classified by ownership

Net profit / (loss) attributable to owners of the parent

861

386

Net profit / (loss) attributable to minority shareholders

1

Add: Unappropriated profit at beginning of period

4,334

1,518

Unappropriated profit at end of period (attributable to owners of the parent）

5,195

1,904

Other comprehensive income,net of tax

(32)

47

Comprehensive income attributable to owners of the parent

(32)

47

Comprehensive income not be reclassified to profit or loss

1

Remeasurement gains or losses of a defined benefit plan

1

Comprehensive income to be reclassified to profit or loss

(32)

46

Cash flow hedge reserve

(4)

(10)

Exchange differences of foreign currency financial statements

(28)

56

Total comprehensive income

829

434

Including:

Total comprehensive income attributable to owners of the parent

829

433

Total comprehensive income attributable to minority shareholders

1

Earnings per share

Basic earnings per share

0.48

0.24

Diluted earnings per share

0.48

0.24

CONSOLIDATED CASH FLOW STATEMENT (Unaudited)

RMB in millions

Three months ended

Mar 31,2021

CASH FLOWS FROM OPERATING ACTIVITIES

Cash receipts from the sale of goods and the rendering of services

8,815

7,439

Receipts of taxes and surcharges refunds

115

157

Other cash receipts relating to operating activities

70

51

Total cash inflows from operating activities

9,000

7,647

Cash payments for goods and services

5,845

5,073

Cash payments to and on behalf of employees

1,249

1,128

Payments of all types of taxes and surcharges

187

130

Other cash payments relating to operating activities

79

112

Total cash outflows from operating activities

7,360

6,443

Net cash flows from operating activities

1,640

1,204

CASH FLOWS FROM INVESTING ACTIVITIES

Cash receipts from returns of investments

1,000

Cash receipts from investment income

6

Net cash receipts from disposal of fixed assets,intangible assets and other long-term assets

26

36

Net cash receipts from disposal of subsidiaries and other business units

28

Total cash inflows from investing activities

1,060

36

Cash payments to acquire fixed assets,intangible assets and other long-term assets

899

597

Cash payments for investments

1,650

Total cash outflows from investing activities

2,549

597

Net cash flows from investing activities

(1,489)

(561)

CASH FLOWS FROM FINANCING ACTIVITIES

Cash receipts from borrowings

531

1,623

Other cash receipts relating to financing activities

347

Total cash inflows from financing activities

531

1,970

Cash repayments for debts

746

2,662

Cash payments for distribution of dividends or profit and interest expenses

42

134

Other cash payments relating to financing activities

143

107

Total cash outflows from financing activities

931

2,903

Net cash flows from financing activities

(400)

(933)

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS

(2)

7

NET INCREASE IN CASH AND CASH EQUIVALENTS

(251)

(283)

Add: Cash and cash equivalents at beginning of period

2,763

2,167

CASH AND CASH EQUIVALENTS AT END OF PERIOD

2,512

1,884

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