Sino-American Silicon Products Inc. (5483) Earnings Call Transcript & Summary

Welcome to SAS' First Half 2024 Earning Conference Call. I'm CW Lee, SAS Vice President as well as company's Spokesman. We also have Doris Hsu, Chairperson and the CEO in this call. First off, Doris will give us the executive comments and then I will make a brief presentation of group structure and the industry overview and the 2024 first half financial performance. I will address the FAQ we recently received and Doris will answer the questions raised in the open Q&A session. [Operator Instructions]. Please note that some information during our discussion today will consist of forward-looking statements, which are applied throughout the call and this presentation. These are subject to significant risks and uncertainties. Actual results or trends could differ materially from our forecast. Please refer to the safe harbor notice in our presentation, Page 1, disclaimer. Now I would like to turn the call over to Doris for executive comments. Doris, please.

Thank you, CW. Good afternoon, ladies and gentlemen. Thank you again very much for joining Sino-American Silicon''s earnings call of Q2 2024. If you have already downloaded our material from the website, please, could you please turn to Page 4, our financial highlights. The first half 2024 was a very good 6 months for Sino-American Silicon, for SAS. SAS overall performance in the first half 2024 was very good. It is consolidated revenue, net profit and EPS of these 3 factors achieved the second highest level on record in the first half of 2024. So SAS overall performance in the first half '24 was very good. In Q2 2024, SAS recorded total revenue of TWD 19.9 billion, which is Q-o-Q growth around 1%. And this is our third highest ever over the same period. Our first half 2024 revenue was TWD 39.6 billion. This is the second highest record of SAS overall over the same period. The growth of first half was contributed mainly from Actron, AWSC and TSC, these 3 companies' strong performance in the first half. Later on, I will share a little bit more details of the 3 companies' performance. SAS overall gross margin in Q2 was 32% and first half was 31.7%. And our second quarter gross margin increased by around 0.5% Q-o-Q. And this again was mainly driven by group companies like Actron, AWSC and TSC's good performance. In addition, GlobalWafers, which is the biggest company in SAS Group, also overall performance in first half '24 was okay, especially on the gross profit margin, net profit margin and ROEs from these 3 aspects. As always, GWC's performance on overall profitability is always one of the very best ones among the peers. In the first half 2024, same as the past, surpassed GWC overall profitability performance especially on gross profit margin, net profit margin and ROE are still one of the best among all the peers. So GWC's stable contribution from profitability is one of the key factors for SAS first half overall performance as well. In Page 5, please. Please move to Page 5. So moving on to Page 5. SAS overall net profit margin in the second quarter 2024 was 17.8% net profit margin. In the full H1, our net profit margin was 18.9% and SAS EPS for the whole H1 was TWD 6.35 per share. So I want to make a quick update on our overall dividend payout as well. SAS will distribute a cash dividend of total TWD 8.8 per share in 2023. The first half is TWD 3.5 per share, in the second half will be TWD 5.3 per share. This represents a payout ratio of [ 51.8% ] for 2023, and this is completely consistent with our dividend payout policy. We will pay out second half 2023's dividend, which is TWD 5.3 per share on August 23, just for your information. And please move to Page 6 for the renewable energy overview. Let me provide more insight about renewable energy sector. In order to achieve the net 0 target by 2050, which is the goal for the whole world, most of the companies in the world. A total of 35 terawatt of renewable energy facility will be required globally. 35 terawatt will be needed to achieve the net 0 goal by 2050. This corresponds to substantial investment into the sector in the next 2 decades. Based on the latest world energy investment report by IEA, International Energy Agency, global energy investment is expected to exceed USD 3 trillion for the first time this year, 2024, USD 3 trillion. That's the worldwide energy investment will be made this year. And among this USD 3 trillion, USD 2 trillion out of USD 3 trillion will be allocated to clean energy technologies and infrastructure. And this number is expected to further increase in the next several years. So I think energy industry, this is definitely a very important and a very good business segment for the whole world. Page 7, please. Page 7, I would like to share an overview of SAS and also update a little bit about SAS overall business strategy. SAS is a company with very extensive global footprint, spanning across semiconductor, automotive, electronics, renewable energies and even chemicals. Over the past few decades, we've already built up an increasingly balanced and diversified business portfolio by deploying an active investment strategy as well as leveraging our ability to identify high potential companies to invest. In the semiconductor and automotive electronics segments, we have already formed strategic alliance, both upstream and downstream. As of today, SAS has already built a competitive industry ecosystem. And GWC global footprint and semiconductor network continue to fill the whole Group's growth. On renewable energy front, SAS is highly focused on sustainable energy and has transitioned from a pure manufacturer into a one-stop renewable energy solution provider. That's a very important new position for SAS. In the past 43 years, SAS used to be a pure manufacturer. But starting from a couple of years ago, we started making the transition. Our goal is to transit to make SAS reposition ourselves from a pure manufacturer into a solution provider, which will be a renewable energy solution provider to the industry. We partner extensively with our key group companies to mutually expand the scope of operations. And this strong synergy will lead to further growth of [Technical Difficulty] that chart illustrates the outstanding performance of our affiliates. As of the first half of 2024, the Y-o-Y revenue growth has been quite impressive ranging from 53% to almost 200% compared to last year. In fact, not only in 2024, these key affiliates companies have been demonstrating a seller trajectory. And CW later on will further elaborate the success track record of these companies later. Okay. Next, please turn to Page 8 and 9, GlobalWafers. I think GlobalWafers overall performance in first half 2024, it's very obvious that Q1 '24 was the bottom of this cycle, semiconductor cycle. GlobalWafers revenue very clearly in Q4 was the bottom and starting from the second quarter already bottomed out and slightly increased much better than Q1 2024. There are 2 challenges for GlobalWafers in the second quarter. The first challenge was the earthquake on April 3. And that one not only the 7.1 magnitude earthquake on April 3, but also followed by more than 1,000 aftershocks. All of those shocks caused a lot of trouble to GlobalWafers. That was the first challenge for GlobalWafers in the second quarter this year. The second challenge for GlobalWafers was the cyberattack on June 12. And fortunately, we navigated all the challenges smoothly, and we restored all the operation swiftly. Despite the earthquake impact and also the cyberattack, GlobalWafers overall performance in the first half remains as good as before from profitability viewpoint, especially from gross margin, net margin, profit and also ROE from these 3 fronts, from these 3 aspects, GlobalWafers performance was still one of the top performers among all the peers in this year as well. The only weak point for GlobalWafers in the first half is revenue growth. It looks like GlobalWafers 2024 first half revenue drop, which is much higher than the original expectation, what we anticipated earlier. But the main reason for this is because 2023 GlobalWafers revenue in 2023 was still all-time high. And GlobalWafers revenue was one of the very, very few companies in 2023, among all the silicon wafer peers companies that reached another record high. So SAS 2023 revenue was record high. So that was why when we compare with last year, the other peers Y-o-Y the drop looks same as GlobalWafers, but as a matter of fact, GlobalWafers overall revenue performance compared with others, no specific difference. So that's our overall performance profitability-wise, we're doing okay revenue-wise because of the inventory correction was lasting longer than our expectation. So the overall revenue performance was not as good as our original expectation. That's GlobalWafers. Page 11 is ESG and corp governance. Let me elaborate a little bit about our corp governance performance in our efforts for this. For the 10th and the 6th consecutive years, SAS and GlobalWafers have been awarded top 5% among all the listed companies in Taiwan for the corp governance evaluation result. So we are very honored and very happy to have this result, and we keep working on this. In addition to very good corp governance evaluation result, in 2023, we once again received the honor from Commonwealth Magazine as one of the top 100 companies ranking, actually, we're ranking the 6th in terms of revenue among 72 semiconductor companies in Taiwan. And we are ranked as the 24th in terms of net profit among 1,350 manufacturers in Taiwan. Our Board, and also this year for the Board composition, we have some further improvement. Our Board now consists of over 1/3 of independent directors, and with rigorous annual evaluations, we will continue to prioritize our corp governance and transparency and also our accountability in our corp governance efforts. So in general, I think the first half 2024 SAS overall performance was very good. And GWC was good in from profitability's viewpoint. But from revenue's viewpoint, is it was lower than our original expectation. This concludes my comments for now. And I would like to pass this over to CW to share further details with you. Thank you very much. CW, please.

Thank you, Doris. Next, let me introduce SAS company overview. Please turn to Page 13. To optimize our mutually beneficial group synergies, we leverage our critical resources allocation across key group companies in terms of global network, sales channel and the management expertise. We empower respective global companies to elaborate their strategic vision and to drive their growth momentum. We currently have 5 major consolidated group companies. First one is GlobalWafers, the third largest and the largest non-Japanese wafer manufacturer globally, operates 18 sites across 9 countries with the most comprehensive product portfolio in the wafer industry and better flexibility and the advantage of local supply. GlobalWafers is customers' preferred partner in mitigating the challenges of geopolitical in today's world. Actron is a leading automotive electronics supplier and the global largest automotive [indiscernible] low, loss styled and the [indiscernible] supplier with over 50% and 70% market share, respectively. Next is AWSC, Advanced Wireless Semiconductor Company, is the second largest GaAs foundry company with more than 20% market share, it's power amplifier widely applied in satellite and cell phones. Next is TSC, Taiwan Specialty Chemicals, is one of only 4 semiconductor grade, high purity [indiscernible] mass products in world, a specialty chemical used in semiconductor manufacturing process. Following verification among customers in Taiwan and overseas, the business is expected to grow further. Lastly, sustainable energy solution provider provides a renewable solution to group companies and the end customer is service. In partners with companies in the green energy transition and the ESG trend by assisting with renewable solutions. SAS strategical network, we embrace more promising companies to enlarge our ecosystems and are passionate in embedding the [ heating ] champions. Page 14. Moving forward to group revenue breakdown, we are dedicated investing in 2 companies with competitive positioning and compatibility with our core strengths. SAS investment have become a growing catalysts, building on the solid presence of GlobalWafers. With more affiliate join the SAS Group, we have diversified our business scope, establishing and increasing balanced and diversified business portfolio. With further consolidation of group companies into SAS financial statements, including TSC in August of 2021, AWSC in June 2022 and Actron in October 2023, their revenue share has grown from 0.2% in 2021 to 16.9% in first half 2024. The growth of these affiliates is expected to drive continued future growth not only but also bring sustainable growth to the SAS group as a whole. On Page 15, furthermore. We are iconic conglomerate with a footprint spanning across semiconductor, automotive, electronics and the renewable energy sectors. Through a strategic partnership, we have established a strong competitive position in the semiconductor industry. Our key advantages, including our global capacity, extensive network and diverse product portfolio, silicon, compound semiconductors, specialty gases and the chemical filters continue to drive substantial growth. We have developed a competitive semiconductor and automotive electronics industry chain from materials to IC design, manufacturing, assembly and testing. This approach not only expands our operational scale, but also strengthen our group competitiveness within the industry. Our product applications are deeply embedded in a day-to-day life as well as the next-generation technologies, including artificial intelligence, et cetera. Page 16, in addition to semiconductor and the related materials, SAS footprint also covers renewable energy with the sales of wind, hydro and solar energy to clients in semiconductor industry as well as the SAS group's internal consumption. We focus on sustainable profitability through comprehensive control over the entire value chain in renewable energy sector from material manufacturing to energy generation and solutions. Additionally, through strategic expansion, we established a one-stop energy solution to customers by integrating energy trading and the storage capabilities. As announced in early July, SAS just signed a 10-year green power supply agreement with customers. This not only underscores our dedication to providing renewable energy solutions, but also serves as a testament to the trust and the confidence our customers have in our capabilities. Given renewable energy becoming indispensable factor worldwide, SAS aa reliable and forward-thinking energies provider will continue to partner with our customers in assisting them to satisfy the green energy requirements for future collaboration and sustainable growth. Next page. The success of our investment strategy continues to be demonstrated by the impressive results of our key group companies. SAS group companies, including Actron, TSC and AWSC have delivered robust and impressive results. In first half 2024, group affiliates, Actron and TSC all delivered impressive operational result. Actron revenue has been growing for 3 consecutive years with a first half 2024 revenue reaching TWD 3.68 billion, 53% Y-o-Y. About AWSC. As of Q2 '24, AWSC has achieved 5 conservative quarters of revenue growth, with the first half revenue TWD 2.59 billion, nearly matching the entire 2023 revenue with an impressive nearly 200% Y-o-Y. TSC is set to be listed on the Taipei Exchange later this year with the first half revenue, surpassing TWD 400 million, doubling compared to the same period last year. Next, let's move to industry overview. Please turn to Page 19. In order to achieve a net 0 target by 2050, a total of 35 terawatt of renewable capacity will be required globally, representing a roughly 10% CAGR from 2023 through 2050. This renewable capacity is expected to account for 81% of the energy mix by 2050. We have already seen investment ramping up with global energy investment expected to exceed USD 3 trillion for the first time this year, among which USD 2 trillion will be allocated to green energy technology and infrastructure with a balanced mix in areas such as renewable power, grid and storage, energy efficiency and end use. On Page 20, current spending trend only addressed 2/3 of the investment need to achieve the target tripled renewable energy capacity by 2030. To close the gap, an additional USD 500 billion is required annually from now to 2030. In order to meet the COP28 goals, global clean energy investment would need to be doubled by 2030, and even quadrupling in emerging markets and developing economies outside China. Page 21. In Taiwan, our energy transition policy targets to become new career free and generate 15.5% electricity from renewable sources by next year comparing to 9.5% of electricity from renewable sourcing in 2023. The long-term goal is to reach net zero carbon emission by 2050 with 60% to 70% energy generated coming from renewable sources. As of June 2024, Taiwan has sold a total of 19.6 gigawatt renewable energy capacity with solar PV accounted for nearly 70% equal to 13.4 gigawatts. SAS will catch current growth of renewable energy demand around the world, including Taiwan, cell-related products, such as solar module cell and/or wind, solar, green power and extend the renewable energy business to the world. Let's turn to Page 22. Moving on to the semiconductor side, the market is expected to experience significant growth and reached USD 1 trillion in market size by the end of 2030, represented a 6.8 CAGR advancement in various sectors contribute to a semiconductor market growth. Among these verticals, computing and data storage, wireless communications and automotive electronics are among the largest growth contributor, underpinned by trends such as AI, autonomous driving and 5G technology. Next page, Page 23. On capacity side, AI processing and the relevant applications are driving the demand and development of high-performing chips, which leads to robust expansion of global semiconductor fab capacity. Globally, the semiconductor fab capacity is expected to increase by 6% to 7% per year until 2027, [ 18.7 ] million wafer per month. GlobalWafers as the #3 semiconductor wafer supply with complete various wafer product solution with fab expansion in coming 3 years. We believe it's a great chance to expand our business scale in various application worldwide, especially in 300-millimeter and 200-millimeter wafer. Let's move to our 2024 first half result. Page 25 and 26 are our second quarter and first half initial highlights. As Doris mentioned earlier, our Q2 revenue was TWD 19.9 billion, which represented a Q-o-Q growth of 1% and was our third highest ever over the same period. First half revenue totaled TWD 39.6 billion, which was 4% Y-o-Y decline but still the second highest record well as over the same period. EPS Q2 was TWD 2.94 per share. First half EPS reached to TWD 6.35 per share. EBITDA margin was at 30.9% and 33% for second quarter and first half. ROE was 14.3% and 15.6%. ROA was 5.8% and 7.4%. From Page 27 to 31 are a summary trend of our revenue, gross profit, operating income, net profit and EPS. As you can see, our results show a big improvement in the past 4 to 5 years. SAS Group continued to persuade further improvement going forward. Page 32 and 33 are our income statement and the balance sheet. Cash and cash equivalents is TWD 50 billion. Some deposits in bank held for 3 months or more and restricted cash, we need to move to other asset items which accounts TWD 41.5 billion. Inventory showed a similar amount versus the previous quarter. Shareholder equity increased to TWD 107 billion versus TWD 88 billion in previous quarter or TWD 82 billion in 2023. For ESG, next page, from 35 to 38 since given time is limited, I skip. Next. For the performance of GlobalWafers, I skip this one too.

Next, let's move to Q&A session. First off, I would like to address both the questions we have received from investors recently and those we anticipate will be raised. First question is about reinvestment company performance regarding update overall status and the whether further growth in [indiscernible]. I think I have explained in the previous explanation. Through our investment in reinvestment company, we have strengthened our business presence in the renewable energy, semiconductor and automotive sector solidifying our position. This essential industry are integral to daily life and infrastructure, energy and technology. We believe this synergy will continue to expand, providing sustainable growth momentum. We will carefully evaluate our shareholding strategy when the timing is appropriate. Next question is about the renewable energy business update and outlook. As you know, energy has become a critical component of national security and global track, making a transition to renewable energy is inevitable as the evidence by policies worldwide. Future product must not only be high quality and affordable, but also low carbon. We have observed favorable industrial tailwind recently due to the potential imposition of U.S. tariffs on imports from China and Southeast Asia, which might provide an opportunity for Taiwan to benefit. SAS holds significant advantage in the renewable energy sector through vertical integration across the solar energy value chain on sales and margin manufacturing to power plant development and operations and maintenance. We have also ventured into green energy sales. Our strength lie in our exceptional management capability, extensive industry experience, strong profitability and broad sales channels. These factors could create opportunities for us to enhance our competitive position. Also some questions for our investment company. I think I will skip this one because I had just explained in previous slide. One question regarding with the Actron that he is asking why, the reason why our Actron first half revenue is higher than first half '23, but EPS was less than first half '23? There was a onetime nonoperating income result in Q2 '23, total first half '23 EPS become TWD 4.94 per share result that was TWD 0.59 higher than this year, first quarter, TWD 4.35. But if we take a look at gross margin first half this year was TWD 1 billion, it's around 84% higher than last year, same period, TWD 577 million. I think, yes, I will stop here. That is my response to your question. Now I would like to turn it over to Doris for the Q&A section. [Operator Instructions]

Okay. Yes. This is Doris again. So let me start from the first question, market price and technology trend solar industry. Market price is fluctuate. I mean if you are talking about the world's market price, China market price keeps dropping. But outside of China, some countries like U.S. price remained very flat, but Europe is very, very bad as well. So let me put it this way that you can separate the whole world into 2 categories. One is that some selective market, that means that there is some special tariffs for China or China-related companies products. And that kind of country's market price will be very different, will be much higher, like U.S. and Taiwan. Both the U.S. and Taiwan are China cell or China cell cannot be using both Taiwan and U.S. So for Taiwan and U.S. market prices flat and actually is a little bit decreasing, but for the country like Germany, China and South Asia countries, actually, the price is very, very bad right now. So market price, in general, solar market price has not improved much, bases still remain very weak. Technology-wise, right now, for silicon-based, I think the technology is a tough comp, but it should be M12, it's not M10, it should be bigger than that. And even the dimension is even bigger than ordinary M12. On top of this, actually, some companies have already started working some other material, including [indiscernible] junction, that's another choice. The mainstream right now is still [ Topcon ]. And okay, next is that was the latest view on wind power. I think especially for Taiwan, we need wind power because we don't have enough space for solar power. So wind power is needed. But right now, the round 3.1 wind power price is too high in the market, still very high. It's not affordable for many companies, many industries, still a little bit too challenging. But SAS is still working on the wind power because no matter what we need to, we need to be able to secure enough green power for SAS and GWC all the group companies and also for many of our customers. So that's why SAS will be still working on wind power, although the price right now is still too high. I think government have already noticed this critical issue, the pricing issue. So maybe there will be some policy change like that some local content. This specific criteria, maybe will be relapsed a little bit, but there is no firm decision yet for the wind power. In general, I think our Round 3-1 and 3-2 will be needed if Taiwan want to reach net 0 by 2050, I think we need wind power, without wind power, it will be very difficult for Taiwan to really reach net 0. So demand is there. But price-wise, cost-wise, wind power is way too high right now. Okay. And next is, that's PIGC's question, asking about that some questions specific questions. The first one is why SAS consolidated gross profit margin still 0.5% higher than Q1? No, it's not for any write-off, it's not for that specific one-off issue. I think the main reason is because we have some we have some special reserves for employee bonus that kind of be but whenever your profit final profit. I mean it's not the group consolidated profit, it's for the BU itself. If your profit is lower, then your bonus reserve will be lower and your bonus received next year will be lower as well. As I answered to a previous question, actually, solar price is very tough. And as you know in Taiwan, it's not only solar products price is tough, but also the demand is very weak. Not so many solar new projects ongoing right now. So that's why I think if we check solar BU's profitability only, actually it's weak, it's not as good as last year. So that was why we have to lower our reserve for '23, and that's one of the reasons that it will be a little bit better. Okay. So the third question, if we are talking about solar only, our gross margin is below 10%. It's still positive, but it still is below 10%, but it's positive. Our solar-only business is still positive, but it's below 10%, gross margin-wise. Yes. Next page, please. The second question, sorry, I missed the second one. Please back to previous question. The second one is talking about GlobalWafers. GlobalWafers Q2 OpEx was higher. That's because GlobalWafers Q2 OpEx higher was because of more expenses in R&D as well. Yes, our expansion fee, we were talking about, that's OpEx, yes. So we have some expansion. So that's part of the reason that OpEx is increasing and Actron, AWC's expenses also increased total for TWD 400 million increase. Why second quarter's overall expenses less than TWD 200 million? Okay. I think when I said the bonus adjustment, bonus reserve adjustment, I was talking about COGS bonus adjustment. That's for operators and direct ITOs. And also another portion is OpEx because as sales, R&D and also the Board for expenses, for bonus, for remuneration, those fees will be included in OpEx. So that's one of the main reasons. Okay. Next question, please [Foreign Language]. Okay. Next is elaborate TSC strength. TSC will be IPO very soon, we are working on this. And the strength of TSC that we explained that there are not that many companies in Taiwan, chemical gas company who really can produce specialty chemical, specialty gas for advanced material. So a very unique strength for TSC is their R&D and production technology for specialty gas. Please understand it's not specialty chemical. It's gas. Gas is more critical than chemical. Both of these are very critical, but guess it's very hard to mention that the first strength is the uniqueness of TSC is the capability to manage and develop and produce specialty gas. This is the first strength. And the second strength is that TSC team, the team has very good knowledge for global chemical logistic arrangement, it's very complicated. It's much more complicated than shipping wafers to globally. I mean, shipping chemical gas globally, this is so much more critical than the first one. So because of these special launches in know-how, they are providing a lot of support to oversee customers to ship the wafer, should ship the gas to overseas customer. That's the second strength. And the third strength is they have very good connection in terms of the leverage with SAS Group's semiconductor network, they have very good access with almost all of the semiconductor companies, especially for those advanced ones. So that's the third strength for TSC. And of course, another strength is that TSC has 3 business categories, 3 sources of their revenue. The #1 is self production. The second one is the global logistics support. And the third one is that they also import some good material from oversea and to resell to Taiwan's customer. That's a very special service capability because you need to have very special storage for chemical gas storage capability, and you need to know how to handle various kind of specialty gas and TSC has this capability as well. So that's why they can grow their overall revenue much better than if you have everything produced by yourself. So those are the strengths of TSC.

Okay. I think we will move to live questions. [Operator Instructions] Okay. First question comes from Donnie.

Can you hear me?

Yes, please.

So my first question is regarding to the second quarter gross margin. So because I'm not sure about the solar business gross margin in second quarter versus first quarter. Just wondering if the solar business gross margin also increased in the second quarter because, I mean, GlobalWafers gross margin in second quarter was lower. Despite we have ATC, we have AWSC, the gross margin has been improving in the second quarter. So I'm not sure about the solar. Could you elaborate more?

Yes, a quick answer is that yes it's increasing, but the gross margin increasing is not solar itself. In SAS, actually, we have SAS core business, we have solar business and another one, we call others. And that others actually does a very unique business, but we have NDA with our customers so we cannot disclose that what's in purpose, what's the application of that one. But that's a very significant business as well. It's still silicon business and still our is very similar to our ordinary silicon business. But the only difference is that it's not for solar, the end applications for other applications. And that one, we had more revenue from that one in Q2. And also, and that was gross margin is much better than solar. So that was why the combined consolidated gross margin, it is in the second half was better. That was one of the reasons.

How much has been improved in the second quarter in terms of gross margin?

You mean that specific one?

Yes, that specific one or SAS' solar and that specific other business. So overall speaking, what's the gross margin improvement in the second quarter versus first quarter?

Okay. We will double check and Donnie I think we can give you, I need to check the data. So I'll give you, please reach out to CW Lee after the call. He will give you a detailed number.

Understood. But it sounds like there is, I'm not sure whether it's significant, but must be some improvement, right, in the second quarter?

Yes, that's true.

And my second question is regarding to the business target because in the beginning of this year, I think you have already correctly highlighted that this year, the SAS business will be outgrowing GlobalWafers. So wondering if you could give us some quick updates on the business target in the rest of the year for the non-GlobalWafers business?

Yes. For non-GlobalWafers business, I think solar wafer itself is still weak, remain that much growth kind of like flattish H2 versus H1, solar only. This one is flat. And the other business will remain strong. I would say that second half Actron, TSC revenue will be still flat or better than the first half and also AWSC as well. So the second half, I think the main growth will be from GlobalWafers for SAS consolidated because as the GlobalWafers second half revenue will be better than the first one. and that will be the main growth. And GlobalWafers volume is bigger than the other group companies. So when GlobalWafers increased the increase by far will be bigger than the other sites. Yes, a strong second half will remain very strong.

Okay. Understood. So basically, I mean GlobalWafers will be growing for sure. And Actron and AWSC likely to be growing just maybe magnitude-wise maybe lower than GlobalWafers growth.

Yes, I would say that it's correct. Percentage-wise, maybe percentage-wise, these several companies combined, I mean, Acrtron, AWSC, and TSC coming in solar together combined percentage-wise, the increase will be maybe same as GlobalWafers, but GlobalWafers the total increase amount will be much bigger than the others, solar will be still flat. Solar not much good news.

Wondering if you could rank, if possible, I mean can rank the sales growth momentum in the second half across different companies, if that's possible?

Yes. I think I would say percentage-wise, Actron and GlobalWafers will be #1, momentum-wise will be stronger, and the others will be flat or smaller low single-digit growth, and solar will be flat.

Okay. Because maybe a follow-up here is because I got a feeling like by end of July, it's like lots of automotive semi companies are turning a little bit conservative again. So I'm not sure whether there will be a little bit more incremental negative impact to GlobalWafers 8-inch or smaller diameter business and Actron's business outlook. I mean because I feel the change is very dramatic, particularly from second half of July. So I'm not sure whether there is any sudden changes in terms of the business outlook.

So far, no, not much. And especially, I would like to highlight a very unique point of Actron, you said actually Actron have very good business, supply, both EV and non-EV. and ICE cars. So they supply ICE cars. So I know that the EV right now is very bad. Hybrid is getting better. I see maybe also quite stable right now. And the best for Actron is that they have very good market share for non-EV car as well. So no matter it's EV or non-EV as long as that overall automotive is good. I think Actron overall performance will be okay. And what's even better is that Actron is gaining market share from ultra low loss style and low loss diode. So they are gaining market share right now. So that was why I said that my expectation is that their second half the growth, the momentum will be as good as GlobalWafers or very close with GlobalWafers.

Understood. It's very, very helpful.

[Foreign Language] Okay. Thank you. I think that's all for the question. But I would like to add one more topic, another one. Actually, I've been asked in the past several months because many investors in the market, they know that TSC will be listed very soon. So we were asked SAS, where I myself been asked, Doris, if TSC will go IPO and Actron already a listed company, AWSC is a listed company, GlobalWafers is also a listed company, then why invest SAS, so why not just [indiscernible] to invest in the other company? I think I would like to highlight that SAS is still a very, very good target to invest for the following reasons. #1 is that SAS is currently trading at a very attractive PE multiple, in overall SAS growth rates above average. So this is very, very good and not a very unique point. The SAS dividend payout is always good, very attractive. So that's different from the other company, although all these entities are listed, but SAS, if you invest SAS, that is still very attractive. And the second one is SAS is not only its core competence, core business for also this investment company. But actually, not only AWSC, Actron, TSC, GlobalWafers, not only this for. SAS has several not listed company yet. Those private companies, SAS invests those companies and so many of them will be a superstar very soon, but they are still behind the screen. So investing in SAS means that SAS is taking care of the screening, we try to figure out which companies have good potential to be rising star very soon. So we work together with them and we try to figure out how much synergies we can materialize with this company, A company, B company and C. So investing in SAS mean is that you'll get the early opportunity to enter to those new companies as well. So that's 2 key answers. I always answer to the investors who are asking me the question. And just very recently I have been asked, Doris, how do you think about GlobalWafers? It's now a good timing to invest to buy more GlobalWafers shares? My answer is always, yes, it's definitely the right timing to buy because of the GlobalWafers overall performance and profitability is still as good as before, very stable and percentage-wise, the profitability is still one of the very best amount or in the industry. So right now, it's definitely the right timing to invest GlobalWafers shares as well. So just add these comments. And thank you again, everyone, for your very good question and also thanks for your time with us. And all the questions which we were not able to complete to answer very completely, we will reply to, we'll follow up, we'll give you an e-mail to provide you more detail. We apologize for not being able to provide all information immediately. Thank you again for your time. Thank you, and have a great nice weekend. Thank you.

Thank you.

I conclude the meeting here. Thank you. Bye-bye.