Performance of South Korean Semiconductor and Display Equipment Industries Show Positive Results

As domestic foreign semiconductor element and display panel industries are aggressively extending their production lines this year, equipment industries are also receiving positive effects. 

South Korea’s top equipment business Semes’s accumulated sales until October Surpassed $864 million (1 trillion KRW), and it is expected that this year’s sales for WONIK IPS, KC Tech, Jusung Engineering will also be higher compared to last year’s.

However as prices of D-RAM continue to decrease, industries predict that semiconductor element industries’ investments next year will be smaller than this year’s. 

Industries also predict that performance for equipment industries hereafter will slow down because most of major equipment industries’ balances from contracts that they obtained are smaller compared to about same time last year. Equipment industries are focusing on how much investments from 3D-NAND Flash, 10-nano System LSI, and display will cancel out decreased amount of investments from D-RAM facilities.

According to quarterly reports that were submitted by major equipment industries to Financial Supervisory Service on the 30th, accumulated sales of 3rd quarter for Semes, WONIK IPS, SFA, KC Tech, AP System, Jusung Engineering, DMS, and Top Engineering increased 20% compared to 3rd quarter of last year.

It was essential that there were many investments from semiconductor element industries. In this year, completion of SK Hynix’s new M14 facilities, 1st step of Samsung Electronics’ investments into D-RAM 17 Line, supplement investments into 3D-NAND Flash factories in Xi’an took place. 

Foundry businesses such as TSMC and Global Foundry (GF) also increased amount of investments by introducing 14/16-nano FinFET Processing. Display panel industries also aggressively extended their facilities based on Chinese industries. South Korean industries carried out investments to supplement and extend China’s Gen.8 LCD factories and South Korea’s small flexible OLED Lines.

Semes, which had made sales of $774 million (895.9 billion KRW) until 3rd quarter, already surpassed $864 (1 trillion KRW) in sales by end of October. This is the first time Semes’s yearly sales exceeded $864 million, and Semes became the first one out of South Korean equipment industries to exceed that number in yearly sales. 

Semes’s major product is cleaning equipment for semiconductor and its major customer is Samsung Electronics’ Semiconductor Business Department. WONIK IPS’s major products are plating equipment for semiconductor and dry etching equipment for display and it made $423 million (490.4 billion KRW) accumulated sales in 3rd quarter that is 38.1% higher compared to 3rd quarter of 2014. It also greatly benefited from Samsung Electronics’ Semiconductor Business Department. 

In case of KC Tech, although its sales in Chemical Mechanical Polishing (CMP) are similar compared to last year’s sales, sales for cleaning equipment for display have greatly increased.

Jusung Engineering’s sales greatly increased as its Space Divided Plasma (SDP) Plating System that was developed by Jusung Engineering last year is applied to SK Hynix’s mass-production lines.

AP System made a remarkable performance this year as its accumulated sales in 3rd quarter increased 109.7% compared to last year’s 3rd quarter due to increased investments from South Korean and Chinese display industries into OLED. 

AP System’s major product is Excimer Laser Annealing (ELA) equipment. It is used to crystallize a-Si (amorphous Silicon) with laser and it is recognized as a equipment that is required when polycrystalline silicon-based Thin Film Transistor (TFT), which is OLED’s board, is produced. In addition, accumulated sales in 3rd quarter for all of DMS, Top Engineering and others increased more than 20% compared to last year’s 3rd quarter.

“It seems that many of South Korean equipment industries’ sales and operating profit this year will be greatly improved.” said a person from this industry. “However as amount of investment for D-RAM facilities will become smaller next year compared to this year, contracts for 3D-NAND Flash and OLED Display will affect performance.”

Staff Reporter Han, Jooyeop | [email protected]