STMicroelectronics's market cap, dividends, sales and earnings in 2020

  •   DEHOUI Lionel

STMicroelectronics is a company that operates in the field of electronics and more specifically in the field of semiconductors. The group is recognised as one of the leaders in the global semiconductor market. It deals with more than 100,000 customers and thousands of partners around the world. In addition, in the financial year 2020, the company experienced growth in its business. Here are the details of the results for the year.

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STMicroelectronics's market cap, dividends, sales and earnings in 2020

Q4-2020 results ahead of expectations

In the fourth quarter of 2020, STMicroelectronics' net sales reached $3.24 billion, compared to $2.75 billion in the same period last year. This represents growth of 17.5% (year-on-year). Year-on-year, the company reported increased net sales in all product groups except the RF Communications subgroup (formerly Digital Integrated Circuits).

Year-on-year, net sales to Retail and OEM customers increased by 11.4% and 19.8% respectively. On a sequential basis, Q4-2020 net sales were up 21.3%. It was 580 basis points above the high end of the company's forecast range.

On a sequential basis, all product groups experienced an increase in net sales, except for the RF Communications sub-group. In Q4-2020, the company's gross margin was $1.25 billion. It increased by 16.0% year-on-year. Gross margin as a percentage of sales fell by 50 basis points to 38.8%.

For the quarter, the group recorded a net profit of $582 million (or $0.63 per share) after dilution. Operating income was $657 million, compared to $460 million in Q4-2019. Operating income increased by 42.7% year-on-year. The operating margin increased by 360 basis points (year-on-year) to 20.3% of net sales from 16.7% a year earlier.

 

Performance by Product Group in Q4-2020

For the fourth quarter of 2020 as a whole, STMicroelectronics recorded revenue growth in both automotive and discrete power products. Automotive and discrete products (ADG) saw operating income fall 16.4% to $94 million. The operating margin was 9.9%, down from 12.2% a year earlier.

In Q4-2020, revenue also increased in Analog, MEMS and Sensors (AMS). This upward trend is also observed in the operating result. It amounted to 402 million dollars, up 42.9% compared to the same period last year. The operating margin was 28.3%, compared to 25.9% in Q4-2019.

Microcontrollers and Digital Integrated Circuits (DICs) saw an increase in sales. However, sales in RF Communications declined. Operating income increased by 46.4% to $174 million. The operating margin was 20.3%, compared to 16.0% a year earlier.

 

Performance of financial indicators in fiscal year 2020

For the full twelve months of fiscal 2020, STMicroelectronics reported net sales of $10.22 billion, compared to $9.57 billion in the previous year. This is an increase of 6.9% year-on-year. Gross profit reached $3,789 billion, compared to $3,696 billion in 2019, a growth of 2.5%.

Gross margin as a percentage of sales declined 160 basis points year-over-year to 37.1% in 2020, compared to 38.7% in 2019. For the full year under review, the microelectronics and semiconductor components maker posted operating income of $1.32 billion, compared with $1.2 billion a year earlier. This represents an increase of 9.9%.

The operating margin increased by 30 basis points to 12.9% in 2020 from 12.6% in the previous year. For the year 2020, the group's net income was $1.11 billion, compared to $1.03 billion in 2019. It is up 7.2% over the one-year period.

Diluted earnings per share increased by 5.3% to $1.20 in 2020, compared to $1.14 at 31 December 2019.

 

Cash flow at the end of 2020

In the fourth quarter of 2020, STMicroelectronics' capital expenditures are estimated at $381 million (net of proceeds from divestitures). For the full year 2020, capital expenditures were $1.28 billion. In Q4-2019, net capital expenditure is estimated at $236 million.

At the end of Q4-2020, inventories were $1.84 billion, compared to $1.69 billion in the same period last year. In the final quarter of 2020, net cash provided by operating activities was $922 million, up from $775 million a year earlier.

Free cash flow (a non-U.S. GAAP measure) was $512 million in Q4 2020, compared to $461 million in Q4 2019. At the end of December 2020, the group had a net financial position (non-U.S. GAAP measure) of $1.1 billion, compared to $662 million at 26 September 2020.

The company's financial resources were $3.72 billion at 31 December 2020. As of the same date, its total financial debt is estimated at USD 2.62 billion.

 

STMicroelectronics Dividend and Market Capitalization in 2020

The STMicroelectronics group is one of the companies that regularly pays dividends to its shareholders. The dividend distributed by the semiconductor manufacturer for the financial year 2020 is 0.24 euro per share.

Moreover, the company is listed on the Paris Stock Exchange on the Euronext market. In 2020, its market capitalisation was EUR 34.39 billion.

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