Audit: SilTerra advised to reduce wafer scrap rate, operating expenses


The SilTerra Malaysia plant in Kulim Hi-Tech Park in Kedah.

KUALA LUMPUR; SilTerra Malaysia Sdn Bhd is advised to reduce the rate of wafer scrap and take proactive action to cut operating expenses and the production of loss-making products to increase the company’s profits.

According to the Auditor General’s Report 2019 Series 2 released today, semiconductor wafer productions involved high operating expenses, causing SilTerra to incur losses.

The report revealed that SilTerra’s financial position was less stable with accumulated losses increased to RM1.832 billion until 2020 mainly due to the depreciation of processing equipment assets.

The audit analysis on SilTerra financial performance found that throughout the company’s nine years of operation, only four years, from 2013 to 2016, recorded profits while the remaining five years suffered losses.

These losses have led to Khazanah Nasional Bhd planning to sell SilTerra as the company’s shareholders equity remained negative since 2006, amounting to RM24 million.

"The selling of SilTerra (to Dagang Nexchange Bhd) on March 31, 2021 by Khazanah has an impact on the nation’s interest.

"This is because SilTerra has many advantages and is the only company that has the expertise to produce world-class semiconductor wafer owned by the country,” it said.

It said that overall, SilTerra has achieved its founding objectives and sales and marketing were effective because most of the revenue came from overseas.

However, it said among the matters that needed attention are the management of key performance indicators (KPIs), semiconductor wafer manufacturing implementation and business receivables management as it is categorised as inefficient.

There are weaknesses in the management of receivables collection as well as non-compliant reminder methods that contributed to the problem.

SilTerra’s business receivables amounted to RM105.59 million (52 companies) in 2017, RM145.17 million (72 companies) in 2018, RM150.21 million (122 companies) in 2019 and RM119.05 million (127 companies) in 2020.

"SilTerra has identified this weakness and took the necessary precautions to move forward,” it said.

The audit found that all three KPIs set achieved over 90 per cent of the target in 2017 but in 2018 and 2019, only one out of the total four KPIs set achieved over 90 per cent target, which is equivalent to 25 per cent of annual achievement.

Meanwhile, three out of four KPIs set in 2020 achieved over 90 per cent of the target. - Bernama

.

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights
   

Next In Business News

MIDA, MEDEF ink MoU on collaborative efforts
Car sales revved up in September as curbs lifted
German-based H&R to invest RM200mil in speciality plant in Perak
IOI Investment offers to purchase US$600m debt notes
Straits Energy Resources unit to acquire RM14.5mil oil tanker
RAM: Edra Solar’s debt service capacity to be strong
Moody's assigns first-time ratings to Hibiscus; outlook stable
Moody’s upbeat on IOI outlook, riding on earnings’ growth, higher CPO prices
ACO partners EV Connection to install electric vehicle fast-charging station
Gamuda unit acquires Binh Duong land for development project

Others Also Read


Vouchers