ENTG - Earnings call transcript Q4 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to Entegris Fourth Quarter 2021 Earnings Release Conference Call. Today’s call is being recorded. At this time, I would like to turn the call over to Mr. Bill Seymour, VP of Investor Relations. Please go ahead, sir.

Bill Seymour

everyone. morning, Good announced and we results our for Earlier year the XXXX. quarter full fourth today, financial

Before I statements. comments and projected today a we in that of actual will listeners begin, number statements. materially include would results like the could some from and forward-looking forward-looking risks These differ involve remind statements uncertainties, to those our

to that we Additional by the On SEC. report and annual Regulation our most information regarding recent disclaimer the G. the these on this as in refer with risks quarterly information and non-GAAP we reports slide uncertainties Please presentation. defined filed financial measures SEC refer is will contained in the to have subsequent the in also call,

on the entegris.com. page website a at our IR can news on You find as reconciliation of table well today’s release, as

are On call hand I’ll Loy, the With and our the CFO. our Greg today Bertrand call Graves that, over Bertrand. to CEO;

Bertrand Loy

all. I our fourth of throughout start which Entegris. operating and in you challenging will record year what very by morning I our in especially XXXX faced with achieved I the environment pleased for am that the to proud saying quarter off we extremely another of Thank good team year. cuts Bill, light results, am

quarter, were fourth million year-on-year grew XX% XX% the During sales sequentially. $XXX and

Our impacted team year. driven the fighting non-GAAP year-over-year. industry margin of growth increased and XX% to we growth us was large through up was quarter that significantly our our sales as exceeded stronger and robust chain and $X.XX fourth successfully hurdles across EPS last EBITDA supply in of results solutions. expectations all parts by These were XX% many and from for benefitted three divisions products record demand over of

and of up we significant of Looking delivered achieved All XXXX, growth margin strong experienced record year three at top in expansion $X.X line the XXXX. billion sales our divisions XX%. full

advanced deposition solutions semiconductor driven ecosystem. the filtration, increasing materials, semiconductor large to of across Our year and other our leading wins with edge the part outperformance edge, position like and areas in by was for importance applications customers liquid in strong our selective

our Wrapping results modestly to Aramus for for addition with pressures. COVID up further XXXX, XX% vaccines And margins EBITDA, solutions, solutions are increased, gross focused biologics. interest strong XXXX for showcase during up we used the million. the the non-GAAP exceeded and due leverage up model financial bags looking use our once related of $XX for the albeit in In non generating COVID-XX But again these cost XX% to ahead, semiconductor stages COVID with we high-purity year-on-year. EPS

in return On buybacks. shareholders capital, debt. allocated During million of million million in R&D. we top our million net $XXX XXXX, that of we included million $XXX XXX And of which repaid in in dividends $XXX to we and reinvestment business CapEx of XXX and

year. social was corporate XXXX Our the for another responsibility highlight program

goal scholarships of Some of and contributed publishing date, the include on to CSR with in Entegris report, investing women from Foundation, To our to additional the our by and $X million the providing is fund, than Entegris annual to million STEM accomplishments scholarships XXXX. first $X communities. internships million contributing has which underrepresented $XX focused STEM more individuals an

our our year point of Board to to our silver, ratings on we and ESG our EcoVadis an of of MSCI increased almost the an to of XXXX During from XX%, way Directors diverse score rating And percentage of rating. our the well XX%. A to view, members increased goal

already our business, M&A front, of migrated On we Precision BASF's have platform. acquisition which the SAP the to completed we Microchemicals

served process are us These as two XXX% allows the We supply years, managed we global advantages on in which operations our of well, end-to-end effectively visibility. have optimization have complex running one very of past currently instance SAP, single tuck-in and acquisitions of SAP, pending CMC leads recent our across to of effectively great this for very future obviously acquisition a provides risks then chain integrated Materials. platform. me which foundation CMC integration of into our Materials, global our all the With greater

As long operational respect tremendous I its CMC its excellence. announced Technology, and reputation Materials for transaction, said, had team this for we we have when

potential We are our our of this to relationships, customers. very enhance create transaction excited value expand customer markets, for our about served the meaningfully and new

year As accretive approximately expect we be following a model unit to reminder, the a resilient with non-GAAP to of revenue. the combined earnings company transaction significantly And business will have the in XX% driven first close.

by approvals that expect competitive once States, satisfy and certain close will in the the United of conditions, and On to objection half all X. antitrust to transaction we the waiting CMC the foreign date CMC the any laws expired was point, shareholders approval second on to continue last mandatory on XXXX, shareholders the the We Materials, and set closing including of customary antitrust without vote U.S. approve period March the week, laws. and transaction for for acquisition, the

the so after addition, immediately focus we ground hit to In running can have the planning, we on close. integration started

period up has will analyzing platform. the During be to time team's as you their and And CMC’s of the areas and model. identify businesses. of Actively two our to a of various of No great as businesses been CMC operate our of candidates and deal respective sale. sign differentiated point. today of we spending separate portfolio our on unit the operating will made assess term execution long as combined business continue between until to in for driven of revenue course, parts know, performance highly fit close, strength final synergies, XXXX, showcase potential Wrapping determination the completely excellent strategic Entegris this closing final

enough, the of I of cannot resilience, dedication, last I proud the chain issues, supply how our and and grateful given throughout say perseverance year, am I persistent As team. said

semiconductor XXXX very well demand industry The driven few. and digitalization, Looking the tested responded expected IoT, computing all ahead smartphones, performance name just and bolstered was given is circumstances. this high ecosystem to of in by chip demand semi XXXX, market to remain industry reverse by to high a CapEx, strong, accelerated and

ease, be will persist lingering will supply COVID And likely the where demand. industry for they will XXXX most to expected issues we chain the inefficiencies. expect as expect to induced supply year result the another some XXXX a of the struggle are meet strong of We degree chain to while

our business, from at in to Looking XX%. we XXXX growth to our range sales expect XX%

laid Let CapEx me our XX%. unpack start given on up the that for approximately unit we will XXXX, To expect the market our be position And full strong year you. for based mix memory and in analyst we the to market logic approximately the points, day. we expect wins during our X X and new by recent what outperform to out with consistent points nodes,

the two Microchemicals Precision growth continued business. sciences little the from our bit acquisition BASF points life of high impact than of In addition, we expect a business and bag in more purity growth

continue of in be I line the to expect Entegris. and target this in CMC $X.XX. does to to an impact We for In time clear, also EBITDA expect EPS pending we is with achieve guidance a acquisition. just full To exciting model the non-GAAP flow excess be our include the not year through summary, provided XXXX from

relevance We at the continues have of to in has our never higher. increased and and conviction been levels, for chain the secular be products the value in our demand semiconductor record growth solutions market,

for around key no will of we to will set architectures built laid materials capabilities And we of architectures. new per complex. And great purity transitions these because be a addition, enablers out, translate process have expanding Entegris is chip have and this content into be of as materials steadily wafer. much more device becoming the you Entegris, are pace strong. for the news, This logic memory unique In know, and both continue as

in Finally, And to times. incredible work they Entegris. the the I want take Entegris once for confidence moment thank such again, thank to and in the teams for around place our a customers grit world trust and dynamic their

Greg. me the to call Greg? turn Now let

Greg Graves

Bertrand, everyone. Thank good and morning you,

record fourth Entegris. another quarter year Our capped off for

sales both and and year-over-year sequentially. million, QX $XXX Our XX GAAP basis XX.X% guidance points our sequentially. margins XX% up non-GAAP up up in above were gross were and XX%

For chain the over COVID more volume driven which gross just the supply margins full well the year, leverage, offset related XXXX headwinds inefficiencies. up documented and than by from XX% versus were

and both margin We a on non-GAAP GAAP basis expect in be XX.X% QX. gross to approximately

We will items assets, included XX and amortization were from non-GAAP Non-GAAP throughout in transaction expenses XXXX. QX million operating costs. and also for $XXX all the approximately of intangible improve other expect million in $XXX QX of year operating and XX% gross million. of margins GAAP be expenses were

$XXX was year-on-year XXX million to over and XX% of and the basis approximately $XXX was revenue. in margin for XXXX. up up compared QX $XXX over XX% will GAAP million to income income Non-GAAP million million. $XXX non-GAAP expenses be operating operating operating will QX QX be million was million of up expenses EBITDA XX% expect or $XXX adjusted sequentially. operating EBITDA $XXX revenue XX% We over and points million year to was GAAP $XXX XX%

Moving to line. the operating below

our mix. the Our than rate in income of guidance was XX.X% by GAAP driven quarter, XX% and part tax geographic non-GAAP less for favorable higher

per both year any of impact full Non-GAAP the be tax clear, X% of tax potential per the XXXX, To diluted GAAP share reform typically rate have to tax rate the purposes, non-GAAP year-over-year, the tax first has approximately rate XX% It's share. year. from $X.XX lowest $X.XX guidance. that modeling noting and up worth sequentially. For the GAAP we not assumed for XX%. be expect EPS we and was quarter EPS in was XX% QX our

primarily up sales for and QX XX% division, cleans were sequentially. million X% was deposition selective by performance driven by our chemistries. advanced to etch Turning of formulated materials, $XXX and Growth year-over-year SCEM

filtration, especially for product strong sequentially. MC driven impacted the not OEM and versus driven by volumes. was in the XX% $XXX in sales The impact primarily sales up for higher XXXX was benefitted year. QX a driven across construction, inventory advanced for margin quarter, XX% purification, QX all by liquid by in and higher fluid XX% Growth customers. and taken quarter. the Year-on-year As constraints sequentially. SCEM a strongest Adjusted strong was handling. our MC year increase recur was new from million of growth AMH and referenced increase strong XX% chain were most in million the QX and margin year-over-year demand of in activity supply adjustment memory volume in the X% gas fab in of was XXXX, for from up logic margin by driven valuation nodes QX for year Adjusted also in up from we SCEM that sequential wafer filtration by last margin significant and in and operating year-over-year $XXX last for The primarily traction discrete was last lines was XX% MC did and the handling which in were operating up and during improvement the sequentially, strong volumes. of quarter, XXXX.

for $XXX Free higher margin primarily addition, $XXX was for In AMH XXX cash slightly products million $XXX operating was full volumes. sales full million Fourth was over QX flow driven significantly by AMH sequentially. the to cash $XX operations quarter margin growth XXXX. contributed during of million million points and up was and basis year. The the from was Aramus XX%, in in AMH for up improvement the and Adjusted year. flow year-over-year

flow be customer XXXX to support future we was what we with XXXX capacity protect Taiwan. spending. for our outlined approximately invest our support choice $XXX for $XXX chain. $XXX is new peak in in expected million in XXXX supply cash expect growth Our day, year free with overall and CapEx reflects facility the for spend new full capital million was $XX our total to Consistent to year demand the for and quarter in million, and to CapEx CapEx analyst in million. the our working to in

for XX approximately shares. our distributed million $XX million we of QX repurchased our and quarterly we During dividend

to share. when said we maintaining announced we CMC increased we we XX% buyback program, recently are our suspending quarterly per acquisition we have dividend, As the but Materials, our share of are which $X.XX

for QX to range sales outlook, from we $XXX our to $XXX expect million. million Now

share colleagues I forward year forward questions. great Entegris would share. another to to We open Entegris will to $X.XX also $X.XX In to non-GAAP like for the summary, closing up to to and team and per in expect like GAAP we I a opportunity to to CMC my XXXX. year say now new EPS we would acquisition Operator, the $X.XX this in entire gratitude to EPS our team. and look XXXX to $X.XX be per record look the take express be for to welcoming

Operator

Toshiya the Thank our you. Sachs. take Hari We from Instructions] [Operator Goldman question will first with

Your line Please open. is go ahead.

Toshiya Hari

outlook. so your Thank question XXXX on much I taking my year. for my strong ask about Good morning. first as and wanted a to you congratulations very question Bertrand,

somewhere to market more you starts wafer up differentiate that be your mentioned for is you an the follow-up. I on in that be perhaps be CapEx market of MSI do outperformance product You business? to for hoping which which expect to And the that unpack for range And side importantly, a you areas then expect was X% expectation could your to between little your basis. organic X% the XX%. segments the the drivers? noted Can have bit I us you a quick biggest and you

Bertrand Loy

Toshiya. Yes, good morning

it's going XXXX. So the blend industry the with XX% indeed, into

be We are expecting digits. we in And now, in MSI are mid-to-high XXXX. thinking the to the CapEx to right about single mid-teens for be

of some five we those our outperformance why The products this be timing is logic mostly node that's in be memory. our new of something really outperformance range recently early and of outperformance three in will a most needs of expect about of products and both discussing, have driven by And been new transitions. timing driving of by with December. transitions still the day in more that we to be transitions will of we've as the that's that during those analyst points you that know that function customers. So that of confirmed The to many we

to the be mentioned had in platforms for those chemistries here I in advanced will do to our strongly we bag we be question, you our outperformance you And most liquid continue XXXX the contribute edge will But to ones outside offering semiconductor And three semi, a said the mean, It in growth it second as leading and products well. part. our XXXX. the new purity of be and surprise grow materials deposition So all will filters. applications. high expect about to selective of we point expect Toshiya? a our

Toshiya Hari

Greg. is Thank perhaps Yes, question that And you on for one my Bertrand. gross for response, margin, second I for do. then one

above. missed of obviously came Revenue this, what key in were but if Sorry, drivers in some significantly I beat? QX the the

extent I'm takes, volume QX, think expectations of then the cost in of inflation, lot would a you helpful? negative And you So if guessing XXXX I'm to gross and mix, you. would that pricing side. on discuss perspective. there's super from that and Thank on that, sure could perhaps else, the a volume, the was puts helpful? about going to terms be positive But higher anything if on speak the about there can but side, how margin be the balance for and

Greg Graves

Yes.

that we But on then So as all initially inefficiencies volumes well, those driver. quarter, you're was for we not mix we, of by I were sort gross as mean, things. additional didn't margin. you our experience the to as mean, given offset right. the of mean, expected. higher number as That I the continue volume offset certainly And supply to chain material inputs. the a had, mentioned, primary able we we of the and good helped was I was we us

our XXXX expectation XX.X%. into go margin is we As for QX

there be certainly for we improving margin XX%. mix it. volumes will into year the a higher full drivers expect Our The is primary and as the expectation play

more number facing creating in is continue We’re that of enough. we a pricing not for the bit hiding selective on to that have might experience side, supply then -- related a overcome to specifically, as we Bertrand raw And headwind inefficiencies that. categories well. us expect there's we're And no increases comment COVID. little are things of fact Things labor on and want absenteeism we'll related implemented material do like chain headwinds we bit little Pricing, around be we them. to input able to the but a

Bertrand Loy

XXXX. until of And the in that which increases, cost later see for improvement measures we some Greg in the don't a were transient close increases drawing the probably was in at in you, bigger I that the permanent think in of steady trying a and of to with the margins we of price between to was expect targeted and was and is XXXX. taking to what look offset the through with input picture previous increases we consistent call Yes, those to that's process that appropriate that benefits take mentioned pass nature, what more

Greg Graves

I I we were stability just I headwinds, pleased mean, XXXX, basis year. mean had fair I for summarize when at of the the would or sure. with quarter Every plus look of or by we year, was share XX%. margin. didn't margin and through saying of the overall, experience I our the minus XX about pretty points we the

well, type performed And I view impact the sort I catastrophic team a negatively avoided But a that margin so mean, at things any state don't all. is of quarter. really would of we XX that major kind in steady our margin

I So good about good it XXXX. about move as and said quite overall capabilities into our we feel felt operational

Toshiya Hari

back potential a depreciation more Taiwan, depreciation dynamic? increase that the in And creep should the year? you're the of on sorry, higher expect investments of in the Or XX, throughout making to we is XX that

Greg Graves

for will this this we operating more the we’ll sure. the of those I creep mean, improvement year, headwinds to that’s XXXX. in XXXX why the into won't year And depreciation XXXX. investment excuse, because depreciation it come that higher margin higher margin will in as yes, and result play levels especially Or until a the than in Taiwan EBITDA see Then significant XXXX. related any facility from of XXXX,

Toshiya Hari

helpful. Very so you Thank much.

Operator

question We'll Sidney take from Ho Bank. at our Deutsche next

is Please line ahead. go Your open.

Sidney Ho

that. all my congratulations I’ll and team. the add Thanks to

you revenue have in Every on for Or supply able the net you pushed million? mentioned cap is you've from you different follow the just strong expect chain these talking previous chain revenue in demand details. on out? all quarter, get update Can roughly will I is supply about customers seen what up question. us to give a semi the an have question there $XX demand. exiting the a Thanks from the demand the satisfy company of just do First outlook supplier? year Last the you very

Bertrand Loy

Yes, and that reduced the constrained so strong we the the Sidney, I products think, for demand a for actual we between the difference finish obviously, have significantly for demand products. add in with QX on unconstrained demand

issues So permanently going behind we in chain obviously lingering focused to limitations chain goal a And be we supply a of supply are to but there's number XXXX, issues. put us, the of with very still guidance chain full QX our half some those to guidance. lingering first taken And the legal account and see that obviously we expect into in supply of impact in year have XXXX.

Sidney Ho

Greg, comments and the end based that maybe just split of past year, XX this profile years? is follow six which year Bertrand XX, on up does the your so mean normal than loaded just you mentioned, more will typically in be I think revenue five, the kind what back

Greg Graves

Yes, that's correct.

steady should year. point meaningful year. the the maybe throughout at So a you expect We expect fairly don't increase this any seasonality in

steady throughout a So year. the growth expect see to

Sidney Ho

around the the that and given regulatory premium about you are up any combined portfolio the Maybe there it early great. confidence I all Okay, these related but close. process? concern, on a about you perspective, also particularly Thanks. financial deal projection disclosure you as talk question addressing about deal. about countries think we the came about Material understand And follow to the that the how the timing entire you deal? should post for gives CMP pretty obviously, for it's antitrust U.S. looks process Can approval to in Understanding, listed CMC like But you quickly. the of what talk talk is pay the too based probably together

Bertrand Loy

remarks, announced progress we two team also the for in year. And we something vote actually as talked March described said, we which the virtually in becoming that's filing no think, HSR of the the the very to the S-X the complimentary we U.S. we by a teams. I now week. far. so when we along. is date is with prepared And very swing. planning platforms fast. moving we, are pleased Last the I both our received the are shareholders with Sidney, was, clearance transaction you, work mid-December that effective which views last No, focused on And of X, about said last in CMC very competitive of The confirms overlap we very quality evidence that obviously as process our as frankly, integration are week, full set

you to So XXXX. And the joint effective. that I and in of expect position of just transaction be very we teams busy mean, on that half lot speculating. very I I continue speculating, are reason all close because to that why don't to that's going updates And front, to a to second tells be into the the would not of and I'm want be the country by a regulatory in go

Sidney Ho

thank Okay, very much. you

Operator

de Our will from come Kieran Mizuho. next question Brun at

Your line open. is ahead. Please go

Kieran de Brun

morning. Hi, good

your I regional than demand the was tax outlook during rate out think mix. throughout XXXX you you fourth regions mentioned is we during little expected progress to just stronger Can bit a the higher quarter? by sales which your due quarter, parse as region? what Thank you. saw And

Bertrand Loy

ties directly Yes. probably overstatement mean, And the that, region. an is say And heavily by revenue, it really impacted ties profitability, of to pricing. the it the the frankly, intercompany it's I to profitability to

trying stronger region So I one or other was the to revenue from a an wasn't insinuation that perspective. make

Kieran de Brun

Perfect

Bertrand Loy

mean, in mean, XX%. the obviously up on the by but really there. current up Korea year. were quarter, mean, X%, obviously, at, North differences X%. revenue. if I directly mean, through the I America look tax isn't sequential driven was I was was a you rate up all I basis. there Taiwan the

Kieran de Brun

I supply some then bit be SCEM headwinds. and by more a And Great. raw these to seems impacted think little of

in general. If thinking ease us how SCEM and should in you you. we help out specifically Thank about can the that in uplift be just potential throughout year margin XXXX, the parse

Bertrand Loy

talk margin that mentioned, then go front. then exit as and as the I and it level chain XXXX, is all to still XXXX. high a we supply truth divisions I XXXX, if lingering enter dealing different different divisions, during the at about three you look impacted the at want at issues you if to we're we supply a And I back supply But the issues. few add year, industry or impacted were the can on but degrees with mean all as times

But component the most XXXX. think two substrates And facing And still of solutions. will contamination. on as specifically, think is likely a constraint materials for AMH, remain divisions I talked for we've mean chain availability half And SCEM a for has probably availability the the press been I in pinpoint around well. division. availability for in capacity. indeed liquid filters of our our It's year. other some through for the coding be significant about mostly are of us first supply the level micro issues I that will concern. attention then remains the and a That

year. a been So it's again, hard fought

I think our by our supply bit and chain we're add that said not focus systemic entirely supply inefficiencies extremely done it. for improvements behind done woods put as But the very front teams thankful there's your permanently partners margin don't I'm you if chain limitations with a those out and of and be make know the to the to the want of us to well goes the team in on has will why XXXX work but that's I I and anything margin specifically. Greg,

on may You be mute, Greg.

Greg Graves

any more business, any plays improvements it see than to expect in three that is is that plays, -- mix continued business, mix the probably We a within role. of and

which margin, will benefit where see turn expect gross through improvements division, I We to also of in which businesses the the within operational all benefit number have operating a will smaller margin. that XXXX, of

Kieran de Brun

much. very you thank Great,

Operator

And with Patrick the next Ho Stifel. is

go line Please Your open. is ahead.

Patrick Ho

to continuing on challenges the face nature? for the center Thank How you that with still I'm costs passing sure supply you going the to chain, balance same right high, at of Bertrand, How logistic supply pieces the terms very find these moving your a maybe first costs, on do freight are terms while of things you that higher the in now. you lot input off chain much. customers, of in a costs that? of these balance find on that's and do where time,

Bertrand Loy

something It's been XXXX we've obviously, XXXX. very closely that monitoring, through and

view deeper that that a to the a it progressed that year stay. into was mostly to the some that some front. became increases were pricing input XXXX, here we were the And those of transient. that think XXXX, take I And in saw, of early action we price as apparent led increases us on lot in

buying. comes and what to pricing; strategic to doing. been our never an that's products, expect of certain times for later in increases those benefits in what that in lead deliberate very find we have we And, always given We have of we permanent see some in offset it types when again, And XXXX. in did been now we as until said, we're some opportunistic trying probably to XXXX, the for won't commodities the we're of increases price

Patrick Ho

you've that you target day. at guidance It's still below get the Analyst Great, that's percentages of on highlighted your up of helpful. talked through And your XQ your analyst expect kind steadily rise XXXX to maybe as Greg, to just as a the OpEx to Should Day? progress at follow question, kind we're about that we at looking we OpEx. model

Greg Graves

other, third will and second, I lower the than mean, quarter. fourth be OpEx in QX

on really We to investments making R&D. in continue the focus

would we would so like, year. continue but and it up we but the be move increases the through our considerably than as work to to does as certainly year, you point is less do see, we be not move the keep That move but your expect line in goal going it's continued revenue. R&D growing it through And what flat, relatively, hard know, SG&A to we to to can

Patrick Ho

Great, again, congrats. thank you and

Greg Graves

you. Thank

Operator

next We’ll Aleksey go to Yefremov with KeyBanc.

Your line is open. go Please ahead.

Aleksey Yefremov

the in sign is Is chain slower XXXX. there issues ask to morning, in pace I resulting everyone. or transitions any or of no you you. transitions on everything Thank track? the Good about node XXXX supply wanted that are

Bertrand Loy

get attention any transitions see of as on be a customers something of at to risk, those three that five expecting significant delayed Yes, that's watch certainly range performance we paying to were and that good be the but out about by don't we of close should putting and that's and transitions we it's would why a outperformance place something announced what is points a right will question, that if take points And number now time. five, logic to again, obviously be if node would memory three node some of you bit our for.

Aleksey Yefremov

And follow digit for Bertrand. wafer assumption a you this starts Thank mid-single year. up your as

Some you perhaps this I about conservative. in inventory of know be may agree. don't are say half the you if correction, level back it And of some year? could thinking

Bertrand Loy

said I mid-to-high. think I

I views mean, higher bit than this we've on in update a it's about CapEx you our But, the and look, growth. industry of growth mid. terms So restored we've to continued both is typically

We as in that have we have Most visibility, customers growth well the our a high we obviously day, during essentially their fully years. of will of greater of fair industry. XXXX say in think as the semiconductor potential it's the degree to we that conviction as customer’s capacity for committed the analyst secular I have do mentioned, fab

expect very wafer high is us good to healthy to of degree of we a and point levels which So fab should, for utilization, your starts. obviously very lead

accordingly. than we wafer now, if update our is starts. if, And will single for that, our for then projection guidance mid-to-high So digit it's better

Aleksey Yefremov

you. Thank

Operator

We’ll to go Amanda next with Citi. Scarnati

open. is go line Please Your ahead.

Amanda Scarnati

been just just forward? you quantify getting Can your by lagging expectations that you the sort utilization greater how are into Can edge the growth morning. ties edge Good you've going support leading versus what quantify the the of and from growth? on

Bertrand Loy

and not it's we so good in something that Amanda that I Yes, morning, Amanda. track fashion, mean, first, it's

across what I to on to embedded have But fly. make which we up numbers the just try in want want don't question, confirm wafer is, your to sizes. strength seen is I So

business great XXX-millimeter had So a year in XXXX. a

the logic. similar said, a year, and in performance strength expect XXXX. we've as expect across segments all throughout be we memory at of And again We type

but wafers So terms outperformance instance, driven customers outperformance everywhere at produced will expect to and in higher line we logic enjoy be content growth width. count in and transition are driven the greater to XD or we Entegris per Foundry to that expect the will as the NAND wafer by more by in see be of the more lay smaller architectures, for edge leading when

is pretty actually XXXX us, for positive the I setup the across for again, segments. so So, year for think

Amanda Scarnati

the conversations XD please in CMC that then a you part at the you've that for I highlighted on talk that announced deal? And big you've deal, of changed you've the about that? being all talk about driver been strategic the rationale? as past think gaining Can deposition traction since sort NAND. chemicals It's the on of

Bertrand Loy

able I us mean in to and could We Look, terms that think conversations talk to on But we with just the of have potential the combination it's early customers that still with really positive. and two opportunity for independent we the very platform. for been what wafer. growth companies about work between be remember until combined two of say the companies, won't close

be and we've we to includes half provide more expect which we synergies in synergies revenue to transaction after expect a color around As that little closed bit said, XXXX. second we the the of

I'll for patience Amanda. we’ll asking So -- question, you that little with be a of bit

Amanda Scarnati

Certainly, I that. you. Thank appreciate

Operator

Our next Paretosh Berenberg. Misra question comes from at

Please Your go line is ahead. open.

Paretosh Misra

everyone. you. Good Thank morning,

to or sales more local about million the Chinese $XXX companies to landscape talk increasingly had last competitive against restaurant you mostly and Can China competing evolving? probably you seeing million competitors? it's guys year. $XXX still Are the how you So

Bertrand Loy

a we so foreign XX% with us. mostly evolved Yes, for And China competitors. stable is quite now about compete a for very the has meaningfully level mean years. country last really The competitive years. not landscape over at that so number is, of I three

Paretosh Misra

I basis typically, seen you Can Because than year Thanks. much talk before about, that And have I XXX was in year? you think legacy typical points lower saw guess, points. then, about basis about products. XXX what you the deflation that last it

Bertrand Loy

Yes, it's our effectively that well. more for of for lifecycle that the right, to of we the In when pricing last new price also few customers. many erosion. discipline we our as create an But capture introduce, and that to the setting managed we that more practices, over most products strategic been managing than become pricing the that opportunity some in extends the price, we over the cases, years have disciplined to products applies I have think value

price the in past. typically see So would that erosion of didn't that is we see portfolio XXXX, that net the we the in

Paretosh Misra

Got in the and gases? it. your graphite product could discuss for specialty other you SCEM categories business, And last some saw what like one in me, of you

Bertrand Loy

in in SCEM XX% performance really grew all, was the very, deposition materials, in first strong So, very of XXXX driven in which performance by year-on-year.

spite supply situation. gases healthy The in pre-COVID the that recover. mid-to-high and the it's coating to grew in in issues quite Graphite of specialty which Graphite were other of did growth chain But yet. XXXX. were in back in grew we areas mentioning, teens a levels specialty high teens. the it's Graphite, not

was are standpoint. case. a both headwind line teens, the high grew back again standpoint. And our from you longer graphite ago, headwind a two a years margins a no That's top It If the business growth and from margin in go favorable. the

took I during lot think, foundational a XXXX. SCEM lot good So a of work place of in again,

Paretosh Misra

Thanks good for the and everything. with luck Bertrand color,

Bertrand Loy

you. Thank

Operator

will at Research get Mike Partners. Seaport to next We Harrison

is line open. go Your Please ahead.

Mike Harrison

morning. adding seems you in been but good ability shifts manufacturing And the well your wondering, on investments expand update labor. process the line trying I expectations in to I to to be just about an was could capacity with bit based additional wondering give find progressing was you've and capacity. better on if a are in Hi, worse? of the It your little performance, made the of talk maybe some on or you've fairly returns

Bertrand Loy

much capacity. in true of manufacturing finish. it's we that that happened adding throughout to progress almost you're yes, And terms in we how year and Yes, got significant that strong XXXX steady so we right forgot very that has the made

manufacturing added your For most context XX/X at in we XXXX are XXXX, to we Entegris. cells right point jobs now. running And manufacturing about

to output the filtration really the we helpful results. I that We also maximization number kudos And online year second to results smoothly. of came the Once of half of pieces was successfully equipment again, can in liquid Ops And lines. added our obviously product QX particularly teams. see that new the in a focus

are So good as as XXXX we a terms thing place of I start internal in very said in the capacity. we

in few course, strong we the expect a making Analyst the Day. large products strong the demand XXXX will fulfill demand the We be projects expect important Taiwan, us we during for demand, in that we're expect for we to XXXX to demand for is be be very able presented have for required will also add as the capacity and for beyond to investment around that investment of we for focus the XXXX. But required

the work upstreams in a and be but busy XXXX, will as good So too lot well. of upstreams XXXX XXXX by years for our

Mike Harrison

actually question talk capabilities you But million? is you investment investment like about my cost XXX the were Can to expand? don't from this more And additional that you're that than to meaningfully million decision what is pretty the that adding? what is going I you drove XXX but of Well question, be announced is Maybe know a dumb sounds Taiwan other expanding about to if that doubling. size it the facility doubling. that

help us that is? understand why maybe why So

Bertrand Loy

I to I mean, expect a remember first of it's that number across personal need of all, Yes, growth we think bit of we needed strong a lines. because capacity, a these add we and product

So already capacity we U.S. have manufacturing today the significant in

in for second decide presence I so the expand mean, decision. for to to lot opportunities new was then us choice really of be Taiwan, a of and we not sufficient. expect growth for that it is is very natural on Taiwan, a lot And to country clear, that largest us basis The island. the was manufacturing a which

to about And level art level. size goals state than question want the times lead invest the in ambitious manufacturing bring a The mean the between desire better we our cleaner environmental automation, has is to manufacturers so investment. and to our really to also manufacturing And obviously, the the competitors. finally, correlation CapEx I have We to processes. very with and shorten capabilities. it to of do of this goal with be new

water of side. XX% on to consume we be expect we example, for the Just that reusing and the recycling

But that over doubt some investment. that So time. off all no big have upfront level requires I pay obviously of will dividends we of

Mike Harrison

thanks very much. Alright,

Operator

our will We Josh Silverstein question take Research. Wolfe final at from

is open. Your line Please go ahead.

Josh Silverstein

was guys. morning, I facility. going with to Good just Taiwan Thanks. stick the

number. this level You kind Entegris expect XXXX, mentioned that that facility $XXX CapEx about of alone. When XXXX? in then, $XXX that off level? about lines, of ramp revenue year of ramped before the in potentially it stay will facility from up, million to million standalone plus And with the half to at that a CapEx would up how fully Would coming same falling long you that you along mentioned potentially take

Bertrand Loy

do that can want part handle the question? first I the take Greg, of revenue you to part.

Greg. You mute may be on

Greg Graves

I'm what sorry, and can -- revenue mute, I'm part. Yes, the point… just caught first I on the But the -- was

Josh Silverstein

CapEx XXXX? roughly year that would million that I half the spending of facilities No Taiwan the $XXX to slated from just on output expect in the initial remain level know at a you this mix? level kind about is for of facility

Greg Graves

got understand. I I sorry. I'm Yes, sorry, fully it. it. didn't Okay. quite got I

for Taiwan. overall Now that it so year our XXXX is expectation will what our in will be also we is, be spend for spending peak year the CapEx, peak

back the look saw we we when flow our free be in forward, So we XXXX. would levels levels will XXXX that by to expect cash

Bertrand Loy

it when And comes…

Greg Graves

as percentage As a of comes a down. CapEx, revenue

Bertrand Loy

of XXXX. of bulk half up And volume when we the XXXX. high ramping expect place the expect the And we first half the production start second comes revenue qualifications of the to picture, it customer in to to take in

ramp So to XXXX fab expect, this and to XXXX. really into continue

Josh Silverstein

you're deals the potential around around me. quiet know last little being divestitures Got you million But BAS through any while small from transaction. still it. And $XXX kind this you’re like the sort then I would consider bit one process? a bolt-on of asset acquisitions going of

Bertrand Loy

well. at now Materials to think to I strong And to a fair us it's statement that growth would that not as CMC probably think I say one, number for and the the the plan. distraction for CMC be be on organic to applies focus allow right France execute integration

with integration M&A, planning small ground least priority running. Next hit after to the to And ready, very us think at be foreseeable on little time close be to day it's and leave one for the additional to I about will work going future. think really

Josh Silverstein

Thanks, Bertrand. Great.

Operator

quarter answer your today’s as thank And session today’s as conclude fourth you for question release will conference We and XXXX well earnings call. participation. that

disconnect may time You at have great this day. a and

Entegris (ENTG) 1 Feb 222021 Q4 Earnings call transcript