Hello everyone. Welcome to Chroma's 2018 first quarter earnings conference call. All lines have been placed on mute to prevent background noise. After the presentation, there will be a question and answer session. Please follow the instructions given by the operator.
if you would like to ask a question.
Okay.
Okay. Sorry. Well, I forgot to release the mute key. Well, earnings release conference call. presentation. Q&A. Welcome everyone. This is Paul Ying from Chroma for the 2018 first quarter earnings release conference call. In this conference call, I'm going to conduct in English for the presentation, and afterwards, welcome to give your questions in either Chinese, Mandarin, or English, and we will take the question and answering in the opposite, same kind of language. Let's start it with the first quarter earnings release. We have already sent those presentation material on the website at 2:00 this afternoon. Please welcome to go to the website to grab those presentation material. Please go to the slide number 10, and this is the very first page for the first quarter consolidated income statement.
In this page, you can clearly see that the total top line for Chroma consolidated numbers is approximately TWD 3.5 billion. Compared to the last year first quarter, this is a 25% growth. If you look at the detail of those top line, you can see that, for the testing and equipment business, this is a double-digit growth, which is at 12%, and it's pretty satisfied by the top management. Secondly, if you look at the consolidated sales of MAS, you can also see that, compared to the last year first quarter, TWD 80 million, we make approximately TWD 600 million at first quarter of this year, and this is almost 6.5 times compared to last year. In there, you can see that also the product mix has changed simply because the MAS portion of the sales revenue increase.
We have slightly decrease in the gross margin ratio. But I think for the gross margin, we growth like a 14%, which is also very satisfied by the top management. For OPEX, we have a little bit higher and if you look at the operating income for the consolidated financial statements, we can see that this is a 16% for the OP margin and also a 20% growth compared to last year. Overall, if we look at the net income from the consolidated page, you can see that we make a 50% growth from last year first quarter, TWD 282 million to TWD 422 million. This is represent a basic EPS TWD 1.06, which is a very good performance we think. If we look at the next page, which is the highlight for the balance sheet.
We also can see that we maintain a very high level of the cash and the short-term investment, which approximately TWD 6.8 billion at the end of the first quarter. If we look at the ROE, return of equity, for the first quarter end, this is a 12%. This is the beginning of the year, so we do believe that we can improve quarter by quarter to like the 20% last year. If we look at the cash flow from the operation, which is a positive, and free cash flow, although this is a negative number, but basically it's value due to, we put a big chunk of our free cash on the investment account. Basically, it's all in the monetary market and very short-term and fixed rated for the return. It's a risk-free kind of investment.
This is for the highlight for the balance sheet for the consolidated financial statement. Let's look into the first quarter for the parent company operation. You can see in the slide number 12. The sales revenue is approximately TWD 1.97 billion. This is a 4% down on a quarter-over-quarter base, but this is a 10% growth on a year-over-year base. If you look at the bar chart, you can easily see that the last year, it's a pretty traditional kind of seasonality. First quarter low, second quarter kind of ramping up, and the third quarter to the peak, and fourth quarter down to approximately the average of the year.
We start off with a growth compared to last year's first quarter already, the gross margin still maintaining 52%, which is pretty satisfied by the management, and also in the target range of between 50% and up. For the operating margin, for the parent company, it is 21%. We do think this is very good. Net income, reaching that TWD 431 million, this is a 51% down quarter-over-quarter, and this is also a 50% growth on a year-over-year. For the first quarter, the sales revenue growth, compared to last year's first quarter, is mainly coming from the turn-key solutions. This is represented at 2 times or 2.4 times growth compared to last year. For the next page, on the slide number 13, you can see that this is a parent-only income statement.
In here, you can see that the gross margin, we still maintained 52%. OPEX, compared to last quarter, which is the fourth quarter of last year, this is a decrease. Mainly due to the fourth quarter normally is the highest point of the OPEX spending before the year-end closing. Compared to last year, we have slightly increase in the G&A and also R&D expenses. Mainly it is from the salary increase. Every year, we put the salary increase into consideration due to our last year's performance and also the market response. For these few years, at least two, three years already, we normally have a pay raise approximately 4%-6%. That is where we are for those increase in the OPEX. Another reason for that is the sum of the activity for the sales revenue.
Due to the sales top line increase, we were going to pay more, like commissions and trade fees and that. That is the part of the reason for the G&A increase. For the non-operating, you also can see that due to the demands growth and also the very steady earnings from the new material, this is a very strong growth for the non-operating income. Another reason is for the Forex exchange loss. Last year, we pretty much suffered from a bit on the exchange loss, this year we do not have that kind of effect anymore. That is pretty much the income before tax. If you look at the income tax for the first quarter of 2018, it is exceptionally high. Due to two reasons.
One is the nominal tax rate for Taiwan government just released that they are going to be increased from 17%-20%, that is one of the reasons. With that reason, our accumulated tax effect on those income tax assets, that will be also only be changed, also the tax rate will be changed. That increase. Those effects will be refreshed on the first quarter, this quarter, of 2018, this quarter only. Along with this year, for the future quarters, this effect will be kind of diluted and even to, we believe, we used to expect our tax rate in the nominal tax rate at 17%, the effective tax rate for Chroma will be like 14%-15%. For the 20% nominal tax rate, in that kind of situations, we are going to change that to estimations to somewhere between 17%-18%.
We do believe this year the effective tax rate will be in that way to change to 17%-18%. The first quarter of this year will be an accumulated effect and adjusting only for this quarter. The net income, again, is TWD 431 million and represent TWD 1.06. This is for the fourth quarter, for the financial statements. For the balance sheet highlight, were pretty similar to the consolidated one. You can see that we still maintaining the cash and the short-term investment at the TWD 2.9 billion level, and the return on equity is 13%, and the return on assets is approximately 9%. Cash flow from the operations is positive, which is TWD 230 million.
Free cash flow on first quarter, due to the increase for the spending on the inventory purchasing, procurement, and also putting the additional cash into the investment items, that makes the free cash flow pretty much in negative. Operating highlights. If you look at slide number 16, you can see that on a quarter-over-quarter base, our first quarter top line TWD 1.978 billion is a 4% drop compared to last quarter, which is the fourth quarter of last year. If we look at the same quarter on a year-over-year base, you can see that we still grow like 10% and mainly growing from the turn-key solution area. If we turn to slide number 17, you can see here that the breakdown of the consolidated entities, which is Chroma, AT, and MAS, and New Material.
You can easily see from here that for the quarter-over-quarter, we drop like 10% on the test and measurement and related system and the product. For the MAS, here we have a drop of 69% compared to last quarter. Compared to the last year first quarter, this is a 6.5 times of growth. New Material still maintaining the same kind of level. Up and down by 10%-15%, due to the changes of the copper wire from the gold wire to copper wire. The profitability of the New Material still maintaining the same and bringing profit back every quarter and every year. In here, again, on a quarter-over-quarter base, this is a 34% drop, compared to last year same quarter, this is a 25% growth. For the 2018 guideline, we didn't change any of our points to the 2018.
In the first quarter, again, the growth driver for the consolidated sales are coming from the Chroma testing equipment business and MAS. For the Chroma testing equipment business, we're growing like 13%, MAS is growing 6.5 times big. The turn-key solution is the key driver for the parent company sales growth in the first quarter, and this is a 241% growth on year-over-year base. For the 2018, we still guide that we're going to continuous growing. Basically coming from the following parts. The first one is the EV still remaining strong. The demand for the high power and the testing and related EV components. The second one is the growth from the semiconductor and photonic testing solutions. The third one is the MAS and turn-key solutions. We're expecting it still will be growing and outperform last year.
Well, for the MAS, I think our expectation will be, at least we're going to double the first quarter numbers for the second quarter, I think. Well, this is my presentation, and I'm taking any questions from anyone.
Yes. Thank you, Paul. We are now in question and answer session. If you have any questions, please press 01 on your telephone keypad, and you will enter queue. After you are announced, please ask your questions. If you find that your question has been answered before it is your turn to speak, just please press 02 to cancel your question. Please press 01 if you would like to ask questions. Thank you. The first one to ask questions, Patrick Chen, Nomura. Go ahead, please.
Paul, hello. Also, hello to everyone. I can quickly ask two questions. The first is to confirm that you just said that MAS in Q2 will be twice as much as in Q1. This is the first question. The second question is, I know that the guidance for the whole year has not changed. Compared to when we gave this guidance about two months ago, have you observed any changes in the key business? [Foreign language]
第一个问题，MAS 在第二季，确实我们获利来说，它的表现应该很不错。我们刚才 guide 的，我们预计大概会比至少两倍，跟第一季比较。至于其他的部分，我想我们并没有做不一样的预期。我们还是 maintain 在今年初对今年度的这个预期，就是我们刚才提到的。
感谢您。
不客气。
We have questions from Jerry Su from Credit Suisse. Go ahead please.
抱歉，Jennifer 你好。我想问一下，第一个就是，第一季的时候，你的 semi 的 revenue 其实季比季还成长 34%。能不能谈一下 semi optronics 这个 segment，第一季成长动能是什么？因为我在想，可能之前你们出了一些 3D sensing 的东西，那 strength 是不是连续到第一季，那未来的展望怎么样？尤其是可能整个 supply chain，第一季度看起来比较弱，不知道你们有观察到什么东西。第二个问题就是关于 EV 的部分，刚好提到 EV 今年还是会继续增温，但是看起来好像第一季的 turn-key 的状况也还不错。包括对 turn-key 这个 segment，今年刚好提到说会比去年好，可是能不能再给一点 color 说大概 magnitude 会怎么样？谢谢。
Hi Jerry, this is Jennifer. [Foreign language] the first question, I think for semi first quarter, I think mainly come from our ATE system. As you know, in semiconductor sector, we have three sections: ATE system, SLT, and photonics, which is 3D sensing parts. The first quarter, I think the biggest chunk actually comes from the ATE systems. We mostly cover those China low-end type of SLP. Moving forward to next three quarters regarding to semiconductors, I know everyone were interested about the 3D sensing progress this year. Our forecast will be mainly in second and third quarters. We also have another driver, which comes from SLT. I think recently we received a new request from NBR as well as Avago for wireless products.
For EV turn-key, I think turn-key projects, we already delivered the first batching orders in the first quarter. That's why we highlight the first quarter, the major growth comes from turn-key, which increased by 241%. That is because that was delivered. We also have another few projects will be coming out in the second half.
EV turn-key 全年的话，有没有什么新的 guidance？
Turn-key [Foreign language]
Right.
Basically, last time we mentioned the order on hand is at least a billion turn-key TWD, which is already exceeds last year TWD 950 million.
所以现在看起来还是超过1 billion。
Turn-key 通常不太会改变，因为基本上那是 order 一定 receive。
那想回过头来，刚刚讲到 3D sensing 的部分，如果说第二季、第三季是旺季的话，不知道你这个出货的，能不能稍微谈一下出货的地区，大家比较关心的可能就是
我先说明一下，基本上我们没有什么所谓的specific产品出货淡旺季，因为我们是一个客制化产品公司，所以我们不可能每一个quarter都做全部的产品，因为基本上接单生产，按照客户想要交货的schedule。只是说，如果大家比较curious的到3D sensing这部分的话，主要的交货时间也是大概second quarter。今年我们3D sensing的order，基本上跟上次的guidance是没有改变的。今年的supplier基本上有三个，其中有一些supplier是去年，其实他的拉货时间也是从去年交到今年，另外一个supplier是新刚加入的。
所以你的意思是说，今年的交货主要就是以新的supplier为主。
对，新的客人。
OK。
但还有一些客人还没有交完。
那这几个新增的客户，他的 pull in 的机台的量，如果跟你们去年的 base 来比的话，不知道您看这个是不是会有比较大幅的增长，还是差不多，还是会少很多呢？
今年我们的forecast，针对部分，我们还是希望说跟去年，维持去年差不多的水准。但是因为我们去年是两个growth，在semiconductor有两个subsector growth，然后一个sector slightly down，今年是三个sector看起来都会比去年好。对，只是每一个sector好多少的问题。
好，了解。好，谢谢。
谢谢。
Ladies and gentlemen, we are now in question and answer session. If you would like to ask questions, please press 01 on your telephone keypad. Thank you. Right now, we are having Steve Hu ang from Yuanta Research . Please go ahead.
Hi，Paul，Jennifer，你们好。Hello，可以听到我声音吗？
可以。
好，就想请教一下，刚刚有提到母公司的有效税率，我们之前是估15到16%，那现在进到今年我们going forward就是看17到18%。然后我想请教Paul，有没有合并报表的一个税务的guidance呢？
您说合并。
合并。
合并很难嘛，因为主要是这样的，我们parent很容易，是因为parent只有台湾营运的这个base，那除了因为台湾现在没有什么tax deduction，所以大概就是17%这个名目税率上下一点点。可是所有合并新南的个体里面，你去看所有海外的据点，包括中国大陆，包括日本、韩国、美国、欧洲，没有一个比台湾税率低的，所以有效税率会比它高，但是每一个proportion会不一样，所以这个部分要盖一个很明确的税率的难度很高。但是如果说你把以前过往的这些数字拿起来看的话，大概还是在20%上下。那现在什么问题？就说因为我们现在名目税率要提升3个百分点，那Chroma的parent company还是最主要的货币的来源，所以大概就这样子浮上去，最起码大概再加2个百分点到2.5个百分点大概都不会过。
加2到2.5个percentage。因为第一季我们合并的角度来看的话，它大概是将近27%，但是如果说for reference的话，大概可能是22到23之间，是一个合理的假设。
Steve 你有做功课，但是如果你去看 stand alone 的话，我们第一季的税率大概高到 21% 左右。所以你看这中间其实就是有一个差异。那最主要的调整的依据跟它的来源，也都是因为 parent company 的税率调整。还有我刚才提到的，就是说第一季的税率是因为我们必须要去累计调整以前的延损的税率，比如说 income tax assets 的这个部分的税率，那 forward 在第一季的时候显现。所以当第二季、第三季，我们慢慢按每一季都要按照 20% 去计算，这个税率这个因素就会被 even 掉。
OK。
回到我刚才提到，就是说从parent company的观点来看，我们认为20%的这个名目税率，大概我们的有效税率可能是在17、18左右。
了解。
第一季是一个exceptional的因素，所以不能够第一季单季考虑。
第二个问题想请教一下 Paul，因为我记得上一次力积电的黄董在法说上有提到，我们这个 MAS 它的 margin 跟以前比起来有一个算长足的进步，因为我们做的东西又更高端。那我可不可以请教一下，MAS 这一块的 gross margin，就是如果我们做 assumption 的话，您觉得在什么 range 会是比较合理的？就以前是多少，现在大概是多少这样子，这样的进步大概是长什么样子。
Steve，我们现在还是以40%上下作为一个reference。因为基本上我有几个考量，它虽然说往前做，那只是说让它的营收变大而已。可是你知道自动化这个industry，它的gross margin大部分也是在那个range。那虽然说有时候会比较高，那可能是based on它各个single project算是一个negotiation所产生的一个outcome。但是我们不能用比如说单一个project比较好，我们要看整体的project加起来gross margin range，所以我们还是会guide大概around 40% above or minus。
就是 up and down，但是 average 大概是在 40%。
对，因为去年我们之前也说过，有部分的是因为collect之前的这个down payment，不是down payment，就是尾款啊。所以会让客人觉得或是投资者觉得说是gross margin增加，其实不是。
那个就是额外的。
对，可是因为这种完工比例法本来就不同时间点的collection。
Mm-hmm.
那你如果加起来，你就会觉得gross margin变高。
了解。那我们刚刚有提到说一些semiconductor跟MAS，刚刚Paul提到MAS第二季我们会觉得是两倍，就是说100% growth at least，这个是MAS，因为两倍有些人可能会误会是200%，actually就是100% increase from Q1嘛。
[Foreign language], double of Q1 sales.
然后像 Jennifer 你刚刚有提到几个，快速提过去，我想再跟您做多一点了解。就是说刚刚有提到 MAS Q2 会是 strength，然后你有提到 SLT 跟 3D sensing 在 Q2 也会 strong，这个是您刚刚有提到的。
我先说明一下，MAS基本上针对整个consumer sales，我们根据季报，因为我们当然是没有办法盖每一个business entities，那我们的best way we can guide to investors，现在大概就是给MAS我们目前的看法，这个sector基本上年末就不太，大概就在那个range。
Right.
那 MAS 的 sales in second quarter versus first quarter 就是 double。那下半年的话，它还是有些 order on deliver, on schedule。针对 SLP 的部分，还有 3D sensing 部分。3D sensing 我们只是说主要交在 second quarter，但是我们其实很难给 exact，譬如说 second quarter 比较多吗，或三 Q 比较多，基本上还是看客人拉货的速度。我们是客制化产品，我们其实没有办法很 exactly project 一个量，告诉客人 exact 是 50 台，在哪个月份。
是 说 ， 呃 ，3D sensing-
3D sensing 的区间，这是 best way we can comment。但是我们没有办法 comment 说，我告诉你说 micro is set, peak season，然后 second quarter 就已经比较多，这个是我们没有办法 control 的。
3D sensing 在 Q2 over Q1 会 有 一 个 比 较 明 显 的 growth，这 样 子 就 对 了 。
我觉得，我其实已经讲很明了，基本上 first quarter 没有 deliver 太多的 3D sensing，主要交付是 second、third quarter。
OK。
那 fourth quarter 有没有的话，我们并没有说 fourth quarter 没有。
OK。
对，但是我们现在的project比较多，现在看起来比较多排的schedule就是second、third quarter。This is best way we can describe。那并不代表整个sensing就会弱，因为我们刚刚也有讲，我们还有SLP，今年也是比去年好。
那我们来提到SLP的话，像您刚刚在QA里面有提到说你们跟Avago有签一个NDA，然后这一块您刚刚有说今年也是从Q2开始会——
不是，不好意思，maybe 是我自己讲不清楚。基本上我们最近针对 SLP 的 driver 是买去 Avago 跟 Nvidia。
NVDA [Foreign language].
因为这两个他们今年都有，Avago 今年我之前有提过 replacement request。另外 Nvidia 他们有新的晶片需要做 upgrade 的测试机台。
OK。
但这个东西没有一定的，它是 rolling forward。
了解，了解，了解。好，这样很清楚。那我最后一个问题是比较long term的，想请教二位，就是说我们发现在power相关的一些产品我们都蛮有优势的，像是电动车也好，像是3D sensing，甚至是一些洁净能源的Mini LED、solar。那我想请教，最近我们政府在推动风电，它其实也是跟power相关，那这一块不晓得我们有没有相关的投资或研发，在风力发电这种测试上面。
这个部分，现在是最热门的topic，没有错的，譬如说替代能源的，还有未来能源的这种政策。我们是power的专家没有错，这个部分我们在比较小的power部分我们是有solution，那我们的客户也有在专攻这一块的。我知道风电现在其实是市场上一个很hot topic，但是我们不觉得说在这一块，我们会take off，然后变得是多好多好，因为这个都是我们平常就有在做的事情。
好，谢谢 Paul。
你现在的customer里面就有做风电的这些supplier。
了解，了解。好，谢谢 Paul，谢谢 Jennifer。
不客气，谢谢。
[Foreign language]. Right now we're having Sharon Chu from Morgan Stanley. Go ahead, please.
Hi Paul、Jennifer，你们好。我有一个问题关于这个test instrument的AT、ATS segment。这个business过去两年呈现一个非常好的成长，都有high teens的成长。你们有提到说其实今年EV这个segment还是非常强劲的成长，那我想要请教一下，今年这个EV的成长性可以支撑这个segment，还是有差不多跟过去两年的成长率吗？或者是在这个segment你们有看到其他比较大的growth driver在今年吗？谢谢。
Hi Sharon。这个部分应该还是非常solid的一个成长。这个部分看起来趋势是不会停下来的。我们对这个部分还算蛮有信心的。
了解。那除了EV相关的成长性之外的话，在这个power testing，就是这个core testing instrument里面，有看到其他的今年比较大的driver吗？
我问一下他。
这一块其实 keep us very busy right now。光是 EV 的产业，如果你下去细分的话，其实它里面成长的动能还蛮多的。但是除了这个之外，其实另外这些所谓我们比较 legacy 的这些 product 跟它的使用，甚至包括像现在这种，譬如说像这个 tested component 的这种 hot topic，它也是我们的对象。所以像这些大概都会让整个 power electronic solution 会很热地一直往前走，所以我们对这一块还蛮有信心的。
了解。那另外就是在EV这块的成长性，从客户的区域别来看的话，可以大概给我们一个breakdown，就是多少来自于中国，多少来自于overseas？
基本上我觉得touching什么是我们比较一个solo growth或steady growth的一个factors。我觉得因为我们一连续三年都是teens growth，这是一个outstanding performance。那今年是不是能再维持teens，这还要再看整个市场的针对EV market或high power这个progress的状况。我们过去在没有teens growth的时候，还是蛮稳健的成长。那如果要再breakdown到细分subcategory，到底是哪个sector在成长，还是要看后续的分析，哪一个industry，比如说这种元件、测爆机这一类的产品，还是power device这边growth比较多，这我们还要再后续的分析才有办法看出来今年的driver是什么。那今年整个EV market来说的话，我觉得我们还是有growth，最主要是电池。除了电动车的testing之外，再来就是battery cell的销售。我们在first time quarter earnings call的时候，我们已经有带出说今年我们整个turn-key解决方案主要的driver，从battery cell来说的话，大致上只有三成左右是跟Chinese maker，基本上有大概over 50%都是non-Chinese。所以你要怎么分呢？如果turn-key的话是像这样，那如果你要把它lump起来，就含所有跟power相关的东西来说，我们还是会认为当然是China的比重会比较多，因为基本上蛮多power device或power component都是在中国生产的。
好，谢谢，这是我的问题。谢谢。
谢谢。
Ladies and gentlemen, please press zero one on your keypad if you would like to ask questions. Thank you. Please press zero one on your keypad if you would like to ask questions. Thank you. Right now, we are having Jerry Su, Credit Suisse. Go ahead, please.
Paul、Jennifer，一个follow-up question，上次有提到韩国这边好像要设一个子公司，跟当地的一些伙伴进行EV相关的合作。不知道这部分进行得怎么样，今年什么时候可以看到一些营收的贡献？谢谢。
养小孩也没有那么快就可以走路，然后上学。所以我们大概在今年年初的时候就正式设立了，3月的时候就把人从台湾派到韩国去。现在整个office人也不多，但是因为我们在韩国其实本来就有供应商，本来也有operation，所以现在就近去管理。那至于说营收的贡献的话，我们现在是看到手上有一些backlogs，但是到底是不是要让韩国去承接这个订单，我们还在考虑。不过基本上我们现在已经可以看到有结果出来了。
谢谢。
不客气。
Next, we are having Arthur Lai from Citi. Go ahead, please.
Hi，Paul 跟 Jennifer，我是 Citi 的 Arthur Lai。请问现在声音清楚吗？
可以，谢谢。
OK，谢谢。我有两个问题，第一个问题是有关于国际的业者目前的动态的。就是说，我们看美国的同业跟日本的同业，他们最近年报完之后都说整个市场因为汽车型手机不太好，让他们也不太好。但是我们刚刚听完公司管理层的那些判断之后发现，好像 semi 这边三个 driver 都是成长的。那能不能够请你们跟我们分享一下，是因为你们的 market 刚好在 ascend 呢，还是说你们是 gain 的 share？这是我第一个问题，谢谢。
你是指哪个产品？Sorry。Semi 吗？
我是指听说 semi 的，像 ATE，像 Teradyne 跟 Advantest，他们市场最近都没有盖得很好，他们都是说汽车型手机。你说。
我说一下，基本上我们AT从去年年初开始，我们有further upgrade到300到400MHz。所以我们从去年开始到今年为止，主要是gaining market share，主要是针对low-end的市场。过去客人可能在测试这种比较low-end range的时候，必须要买一个高阶的产品去测试这个SOC。因为自从我们往上做一阶之后，我们就是gaining一些中国在developing的semiconductor，我们目前看起来市场还是pretty much active。所以他们基本上就把这个机台shift到我们身上。另外部分来说，最近大家也了解我们公司比较擅长在power测试上面，包含半导体类，所以大家最近比较喜欢。举一个集中的产品typical list，那像Bitcoin这种东西，它最主要的晶片那就是MCU。那MCU它基本上是一个power management，所以它需要我们在power这边算是蛮擅长。所以我们基本上也给你一些market share from this type of晶片。那另外一部分当然就是中国比较低阶的SOC。所以一开始，我们今年在看这个ATE市场的时候，应该讲说我们做比较niche market，所以我们目前还是这一块ATE机台，今年compare我们的forecast还是outperform，better than we expect。那3D sensing我刚刚已经comment过，然后SOC来说的话，最主要还是针对一些比较niche的requirement，比如说Avago它有niche一个replacement的一个机台的需求，还有就是一些Nvidia，还有新的stack出来，它现在已经approach我们，针对一些新的它的晶片要launch，需要加一些新的机台。这些算是一个比较大项的highlight在SOC。那当然不是说SOC我们就只有这些客人，当然还有我们civilian的一些客人，比如像MediaTek，或者是一些Qualcomm，这些可能今年不是主要的driver，但是还是会有贡献。
好，谢谢，非常感谢，有帮助。我的第二个问题就是生意太好之后产生的问题，因为我们最近听一些其他像半导体的设备厂商的call，他们提到说像螺旋，这个什么linear motor，还有一些螺杆这些的，事实上交期都很长，有一些短期缺货的状况，不知道公司这边有没有也面临到相同的状况，那公司要如何去面临这个问题？谢谢，那我就没有问题了。
没有。我觉得 this is explain why our inventory increase。就是我们大概一开始，因为我们针对这种客人的 requirement，我们基本上在去年就要开始做一些备料，没有办法等现在。虽然我们这种量不多，但是还是我们已经有，其实从去年开始，我们就已经觉得这些比较 critical 产品的交期有变长，我们其实在过去一直都有在备货，所以我觉得当然就是我刚刚讲的，就是为什么我们存货增加的原因。
基本上没有这个，我们目前没有这种问题。
我们目前没有这样的问题。刚Jennifer有提到，其实我们在从去年大概下半年、年中时候，我们就开始做紧急的备料，然后就开始做其他料的准备。所以刚才提到，这是我们inventory会增加的一个原因。那另外一个就是说，我们是典型少量多样，所以我们其实在对材料替代料的部分，我们本来就有我们自己的strategy，所以针对这个，譬如说真的是太长的话，我们完全是以不会影响到我们整个生产跟交货为目的，然后去做管理的。所以这一块，我们起码到现在为止，大概还不担心。
了解。那个Paul，不好意思，我再问你一个小问题，我看到那个AR days事实上上升到101天，往87天，那是我们应该怎么想这个事情呢？就是说之前87天是因为有客户预付了很多款，所以下来了吗？哪一个会是比较我们在看的时候的一个常态的指标？
针对AR的部分，AR的天数，尤其在第一季的时候，大概通常还是会上升一些，不过因为通常第一季大概就是slow season。那我们自己比较更注重的，大概还是在overdue的这个追踪。那目前为止，没有看到任何的异状。所以我们的产品，我想你也很清楚，就是说我们因为是客制化的产品，其实就是说烂在账上没什么好处的，因为除了我们，当然没有谁能够去做任何的维修，或者是后续的任何的服务。
了解。好，谢谢，没有问题了。
谢谢。
As a reminder, please press 01 if you would like to ask question. Please press 01 if you would like to ask a question. Thank you. There seems to be no further question at this point. I'm going to hand it over to CFO Paul Ying for closing comment. Paul, please go ahead.
[Foreign language]. Well, thanks for your time, and you also can see that the first quarter we have a very good start, although we still expect that the 2018 will be enjoying a pretty traditional seasonality. We also are expecting the second quarter we have a better result. Thanks for your time, and until next time. Thank you. Bye bye.
Yeah, thank you, Paul. We thank you for your participation in Chroma's conference. There will be a webcast replay within an hour. Please visit www.chroma.com.tw under the investor relations section. You may now disconnect. Thank you.