Homepage
PR Newswire
eAGM 30 Oct 2020@9am
(click to pre-register)
MM AR is out today.
(click to read)
After a lengthy development and testing period, MMUS recently received customer qualification for a family of ultra-critical parts used in the semiconductor wafer-fabrication process. Because the qualification was based on the high quality and competitive cost of our products, we have never felt more positive about MMUS’ prospects. Indeed, our team there has worked tirelessly to develop MMUS as an elite supplier for critical parts for semiconductor wafer-fabrication.
Ultimately, we believe only a handful of suppliers to the semiconductor industry will possess the capabilities to meet the increasingly stringent requirements required for manufacturing nano-level device geometries. The Group’s goal is to become a leading Next Generation Supplier to our customers. This strong focus on customers and the great work by our people should enable the Group to maintain a healthy gross profit margin. In FY2020, our gross profit margin was relatively steady at 53.4% despite the challenging conditions. We plan to continue working to strengthen this key measure of our focus on the customer, competitive strength, and the value our work creates.
Valuation of property, plant and equipment
During the year, the Company carried out a review of the recoverable amount of MMUS’s property, plant and equipment, in view of its loss-making position.
--------------------------------------------------------------------------
I quoted 2 parts of today AR:
1. MMUS breakthru after lengthy development and testing with its semicon customer
2. MMUS is loss-making aka until today, MMUS had and had been reporting losses year after year
Looking back into history.
MMUS was brought by Chris during a crisis many years ago.
At that time, MM board make it very clear that the only way they could approve the purchase of a loss-making business is Chris handling MMUS personally aka MMUS will be Chris baby and Chris will be accountable to grow it into a profitable assets for Micro-Mechanics instead of a liability.
Other than initial investment, Chris had continuously pour in a few rounds of capital in order to get MMUS to a viable operating condition. $$$ keep pumping in.
Not just $$$ but Chris himself had to fulfill his promise of baby-sitting MMUS.
Chris devoted a lot of his precious time working with MMUS to iron out all the teething issues.
At that time, Chris like MMUS because MMUS has a great listing of clients which potentially will open up market opportunities for MM's flagship products (hint: not MMUS products).
The idea is simple. MM had a strong foothold in Semicon. By leveraging MMUS client list, MM would be able to sell it's product and hence grow its business beyond semicon.
After a try, Chris realised that it's not so simple. The synergy only works in semicon but not other industry. Painfully, Chris had made a change in the sales strategy and decided to remain status quo in all industry except semicon.
This strategy unfortunately still does not stop the bleed, otherwise you won't see the current situation that MMUS is still loss making.
Granted, semicon customer is more willing to accept MMUS product, however, a lot of capital is required to maintain the sales revenue.
It's a loss making business.
Of course, we must be fair to Chris. He had tried his best.
We had to understand that MM profit margin (before acquisition of MMUS) was excellent but its revenue could only grow with the growth in semicon industry.
The organic growth would be too slow for satisfaction (despite the excellent profit. imagine the capital investment for MMUS is return as cash dividend to shareholders)
Chris idea of leveraging MMUS to branch out of semicon is a great idea.
MMUS was purchased during a crisis and its a calibrated - relatively small purchase - is to cap the risk of investment turn sour makes a lot of sense.
Moving forward, let's see what Chris can do.
Stay home and stay safe, everyone.
(click to pre-register)
MM AR is out today.
(click to read)
After a lengthy development and testing period, MMUS recently received customer qualification for a family of ultra-critical parts used in the semiconductor wafer-fabrication process. Because the qualification was based on the high quality and competitive cost of our products, we have never felt more positive about MMUS’ prospects. Indeed, our team there has worked tirelessly to develop MMUS as an elite supplier for critical parts for semiconductor wafer-fabrication.
Ultimately, we believe only a handful of suppliers to the semiconductor industry will possess the capabilities to meet the increasingly stringent requirements required for manufacturing nano-level device geometries. The Group’s goal is to become a leading Next Generation Supplier to our customers. This strong focus on customers and the great work by our people should enable the Group to maintain a healthy gross profit margin. In FY2020, our gross profit margin was relatively steady at 53.4% despite the challenging conditions. We plan to continue working to strengthen this key measure of our focus on the customer, competitive strength, and the value our work creates.
Valuation of property, plant and equipment
During the year, the Company carried out a review of the recoverable amount of MMUS’s property, plant and equipment, in view of its loss-making position.
--------------------------------------------------------------------------
I quoted 2 parts of today AR:
1. MMUS breakthru after lengthy development and testing with its semicon customer
2. MMUS is loss-making aka until today, MMUS had and had been reporting losses year after year
Looking back into history.
MMUS was brought by Chris during a crisis many years ago.
At that time, MM board make it very clear that the only way they could approve the purchase of a loss-making business is Chris handling MMUS personally aka MMUS will be Chris baby and Chris will be accountable to grow it into a profitable assets for Micro-Mechanics instead of a liability.
Other than initial investment, Chris had continuously pour in a few rounds of capital in order to get MMUS to a viable operating condition. $$$ keep pumping in.
Not just $$$ but Chris himself had to fulfill his promise of baby-sitting MMUS.
Chris devoted a lot of his precious time working with MMUS to iron out all the teething issues.
At that time, Chris like MMUS because MMUS has a great listing of clients which potentially will open up market opportunities for MM's flagship products (hint: not MMUS products).
The idea is simple. MM had a strong foothold in Semicon. By leveraging MMUS client list, MM would be able to sell it's product and hence grow its business beyond semicon.
After a try, Chris realised that it's not so simple. The synergy only works in semicon but not other industry. Painfully, Chris had made a change in the sales strategy and decided to remain status quo in all industry except semicon.
This strategy unfortunately still does not stop the bleed, otherwise you won't see the current situation that MMUS is still loss making.
Granted, semicon customer is more willing to accept MMUS product, however, a lot of capital is required to maintain the sales revenue.
It's a loss making business.
Of course, we must be fair to Chris. He had tried his best.
We had to understand that MM profit margin (before acquisition of MMUS) was excellent but its revenue could only grow with the growth in semicon industry.
The organic growth would be too slow for satisfaction (despite the excellent profit. imagine the capital investment for MMUS is return as cash dividend to shareholders)
Chris idea of leveraging MMUS to branch out of semicon is a great idea.
MMUS was purchased during a crisis and its a calibrated - relatively small purchase - is to cap the risk of investment turn sour makes a lot of sense.
Moving forward, let's see what Chris can do.
Stay home and stay safe, everyone.
![[Image: original_super-cute-merry-christmas-penguin-card.jpg]](https://cdn.notonthehighstreet.com/fs/58/fb/c24a-a4a5-4ef8-a862-df1e1e7a0e89/original_super-cute-merry-christmas-penguin-card.jpg)