Elite Material (2383) Q3 2024 earnings summary

Executive summary

• Net consolidated revenue for 3Q24 reached NT$17.5 billion, up 13.0% sequentially and 47.1% year-over-year, setting a quarterly record high.

• Net income attributable to shareholders was NT$2.52 billion, up 3.3% from 2Q24 and 24% from 3Q23; diluted EPS was NT$7.30, also a record high.

• For 1Q-3Q24, revenue was NT$45.8 billion, up 61% year-over-year, with net income of NT$6.93 billion, up 98% year-over-year; EPS was NT$20.14, all record highs for the period.

• Significant expansion in both domestic and international markets, with China and other countries contributing the majority of revenue.

• Basic EPS for Q3 2023 was NT$7.30, up from NT$6.04 in Q3 2022; nine-month EPS was NT$20.14, up from NT$10.50.

Financial highlights

• 3Q24 gross margin was 27.0%, down 0.4pp sequentially and 3.2pp year-over-year; operating margin was 18.1%, down 0.8pp sequentially and 3.0pp year-over-year.

• 3Q24 net margin was 14.4%, compared to 15.8% in 2Q24 and 17.0% in 3Q23.

• 1Q-3Q24 gross margin was 27.7%, up 0.7pp year-over-year; operating margin was 18.8%, up 1.6pp; net margin was 15.1%, up 2.8pp.

• Cash and cash equivalents at September 30, 2023, were NT$13.6 billion, up from NT$9.26 billion at year-end 2022.

• Total assets increased to NT$70.17 billion as of September 30, 2023, from NT$53.43 billion at year-end 2022.

Outlook and guidance

• High-end CCL market expected to grow at 26% CAGR (2024-2026), outpacing the overall CCL market at 9% CAGR; EMC expects to outgrow the high-end segment.

• Capacity expansion planned, with total laminate capacity to reach 5.8M sheets/month and prepreg 14.7M meters/month by 2025.

• Ongoing expansion projects in Malaysia and China, with significant capital expenditures planned.

• New IFRS standards to be adopted in 2027 will enhance financial statement structure and comparability.

• Management expects no material impact from upcoming accounting standard changes.