BILLION DOLLAR CLUB:
TECHNOLOGY EQUIPMENT + TELECOMMUNICATIONS SERVICES
AEM Holdings, which provides testing services for the semiconductor industry, has been on a growth trajectory that has few equals among Singapore-listed companies — vaulting up the Billion Dollar Club rankings by leaps and bounds. AEM achieved a 60.3% CAGR in returns to shareholders, 40% CAGR for profit after tax and a weighted ROE of 41.34%.
Two years ago, AEM Holdings competed in the Centurion Club for companies with a market cap below $1 billion. The following year, with solid growth momentum, AEM was not only promoted to compete in the BDC with companies with a market value of more than $1 billion, it also swept up all three categories in the industry and was also named the overall sector winner.
AEM Holdings has repeated the feat this year, winning the same four awards. And the company added a feather to the cap by coming out as the overall winner in the entire BDC, taking the spot from last year’s winner Top Glove Corp.
In FY2021 ended December, AEM Holdings achieved yet another record year, with earnings of $92.1 million, although down 5.6% y-o-y while revenue was up 9% to $565.5 million, outperforming its FY2021 revenue guidance of between $525 million to $550 million. Recently, the company raised its FY2022 revenue guidance to $820 million and $850 million, even as the broader semiconductor industry braces for a slowdown. In FY2021, AEM Holdings paid out a total dividend of 7.6 cents per share. This includes a final dividend of 5 cents on top of an interim dividend of 2.6 cents.
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According to AEM Holdings, the better numbers were driven by the strong uptake for its new generation of system-level testing handlers, burn-in test handlers, related consumables, and the consolidation of CEI, which was acquired in 1H2021.
In a sign of how the investment community is positive about the company, in August 2021, Temasek Holdings became the largest shareholder of AEM Holdings when it invested $103.1 million via a placement of 26.8 million new shares.
The company adds that 2021 saw continued growth in semiconductor devices used in data infrastructure, automotive, high-performance computing, mobile devices and artificial intelligence. Growth in global demand, fast-changing market needs, supply chain disruptions, and global chip shortage forced AEM to double up its efforts to ensure reliability, on-time delivery and tool availability for its customers, says the company.
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Throughout last year, AEM Holdings was actively growing as it opened sales and application engineering offices in Shanghai, Hsinchu, Costa Rica and San Diego. It also opened additional R&D centres in Penang and San Diego to enhance its technology capabilities. These new centres and the existing R&D centres in Singapore, France and Finland form the core of its innovation efforts and expand the company’s capabilities.
With a more substantial war chest, AEM has been growing via M&A. Most notably, in 2021, it acquired CEI and invested a 43.15% stake in ATECO, a South Korean company specialising in the design and development of memory test handler solutions. With the investment, AEM says it can undertake joint R&D efforts with ATECO to offer advanced solutions to the memory market. “Our acquisitions have given us customer diversity and manufacturing resilience and increased our technology capabilities.”
While the industry is in a downturn, the company is upbeat about its longer-term prospects. “Semiconductors will continue to play a critical role in creating a better world. As the proliferation of semiconductors grows in mission-critical applications, we are committed to providing rigorous and agile testing that integrates with the rapid advancements in technology, assuring reliability, enabling scalability and accelerating progress,” adds AEM.
CENTURION CLUB:
SOFTWARE AND IT SERVICES + TECHNOLOGY EQUIPMENT + TELECOMMUNICATIONS SERVICES
Azeus Systems tops sector and earnings growth; Silverlake Axis and Totm Technologies pick up wins
Azeus Systems, led by executive chairman Lee Wan Lik, has introduced new products and services to help companies conduct AGMs with the pandemic causing disruptions / Photo: The Edge Singapore
Azeus Systems Holdings, led by executive chairman Lee Wan Lik, has been named the overall sector winner for the Centurion Club. It also picked up the growth in the PAT award, with 133.2% CAGR over the three years taken into consideration. The Hong Kong-based company was listed on the Singapore Exchange in 2004 and has made its mark as a global provider of IT products and services over the past three decades.
The company’s flagship product, Convene, is a leading paperless meeting solution used by directors and executives across more than 100 countries. The company claims that Convene has enabled organisations to “promote and uphold governance through a single secure technology platform to manage and conduct formal or structured meetings — physical, remote or hybrid — and streamline the workflows around it”. As a result of the pandemic, Azeus has introduced a virtual AGM solution, Convene AGM, to help companies conduct the annual meetings even with Covid-19 borders closed and safe management restrictions in place.
The company claims to have completed over 100 IT services projects for more than 40 government departments and over 20 projects for the private sector in Hong Kong, many of which are contracts from repeat customers.
Silverlake Axis, another IT firm, is famous for providing systems and services to clients in the financial services industry. Over the years, it has steadily shifted its business model to one that can generate a more significant proportion of recurring income, giving the company better earnings visibility. With a weighted ROE of 25.03%, the company has come out tops for this particular category.
Totm Technologies was named for leading returns for shareholders, with a CAGR of 154.6% achieved over the three years in review. The company provides end-to-end identity management and biometric products, powering digital identity and onboarding solutions. Totm Technologies says its in-house expertise comprises innovators, disruptors and technologists providing best-of-breed, integrated and highly scalable solutions across domains and use-cases such as national ID, automated border control, finance and fintech, healthcare and critical infrastructure access control.
