UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6‑K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a‑16 OR 15d‑16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

Report on Form 6‑K dated August 19, 2020

Commission File Number:  1‑13546

 

STMicroelectronics N.V.

(Name of Registrant)

WTC Schiphol Airport

Schiphol Boulevard 265

1118 BH Schiphol Airport

The Netherlands

(Address of Principal Executive Offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20‑F or Form 40‑F:

Form 20‑F Form 40‑F

Indicate by check mark if the registrant is submitting the Form 6‑K in paper as permitted by Regulation S‑T Rule 101(b)(1):

Yes No 

Indicate by check mark if the registrant is submitting the Form 6‑K in paper as permitted by Regulation S‑T Rule 101(b)(7):

Yes No 

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3‑2(b) under the Securities Exchange Act of 1934:

Yes No

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3‑2(b):  82‑ __________

 

Enclosure: A press release dated August 19, 2020 announcing that STMicroelectronics has posted its IFRS 2020 Semi Annual Accounts, and the STMicroelectronics N.V. Semi Annual IFRS Report 2020.

 

 


 

 

 

 


 

Contents

 

1.

CORPORATE OVERVIEW

 

3

 

1.1.

History and development of STMicroelectronics

 

3

 

1.2.

Strategy and objectives

 

3

 

1.3.

Organizational structure

 

4

 

1.4.

Products and activities

 

4

 

1.5.

Sales, Marketing and Distribution

 

5

 

1.6.

Research & Development

 

5

 

1.7.

Sustainability

 

6

2.

REPORT OF THE MANAGING BOARD

 

7

 

2.1.

Business overview

 

7

 

2.2.

Segment information

 

8

 

2.3.

Liquidity and financial position

 

9

 

2.4.

Business and financial outlook

 

12

 

2.5.

Other developments

 

13

 

2.6.

Related party transactions

 

14

 

2.7.

Financial Risk Management

 

14

 

2.8.

Business risk information

 

15

 

2.9.

Auditor’s involvement

 

16

3.

INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (“SEMI ANNUAL
FINANCIAL STATEMENTS”)

 

17

 

3.1.

Consolidated income statement

 

17

 

3.2.

Consolidated statement of comprehensive income

 

18

 

3.3.

Consolidated statement of financial position

 

19

 

3.4.

Consolidated statement of changes in equity

 

20

 

3.5.

Consolidated statement of cash flows

 

22

 

3.6.

Notes to the consolidated financial statements

 

23

 

 

3.6.1.

Corporate information

 

23

 

 

3.6.2.

Basis of preparation

 

24

 

 

3.6.3.

Significant accounting policies

 

24

 

 

3.6.4.

Critical accounting estimates and judgements

 

25

 

 

3.6.5.

Revenues

 

26

 

 

3.6.6.

Segment information

 

28

 

 

3.6.7.

Property, plant and equipment and intangible assets

 

29

 

 

3.6.8.

Business Combination

 

30

 

 

3.6.9.

Goodwill

 

30

 

 

3.6.10.

Other financial assets and financial liabilities

 

31

 

 

3.6.11.

Leases

 

40

 

 

3.6.12.

Inventories

 

41

 

 

3.6.13.

Cash and cash equivalents

 

41

 

 

3.6.14.

Equity

 

42

 

 

3.6.15.

Provisions for restructuring

 

44

 

 

3.6.16.

Expenses by nature

 

45

 

 

3.6.17.

Other income / expenses

 

45

 

 

3.6.18.

Earnings per share

 

47

 

 

3.6.19.

Related-party transactions

 

47

 

 

3.6.20.

Contingencies, claims and legal proceedings

 

47

 

 

3.6.21.

Subsequent events

 

49

4.

SOLE MEMBER OF THE MANAGING BOARD’S STATEMENT

 

50

5.

ABOUT STMICROELECTRONICS

 

51

 

 

 

 

 

 

 

 

STMicroelectronics Semi Annual Report 2020  

Contents      2

 

 


 

1.

Corporate overview

 

1.1.

History and development of STMicroelectronics

STMicroelectronics N.V. was formed and incorporated in 1987 as a result of the combination of the semiconductor business of SGS Microelettronica (then owned by Società Finanziaria Telefonica (S.T.E.T.), an Italian corporation) and the non-military business of Thomson Semiconducteurs (then owned by the former Thomson-CSF, now Thales, a French corporation). We completed our initial public offering in December 1994 with simultaneous listings on the Bourse de Paris (now known as “Euronext Paris”) and the New York Stock Exchange (“NYSE”). In 1998, we also listed our shares on the Borsa Italiana S.p.A. (“Borsa Italiana”).

We operated as SGS-Thomson Microelectronics N.V. until May 1998, when we changed our name to STMicroelectronics N.V. We are organized under the laws of The Netherlands, with our corporate legal seat in Amsterdam, The Netherlands, and our head offices at WTC Schiphol Airport, Schiphol Boulevard 265, 1118 BH Schiphol, The Netherlands. Our telephone number there is +31-20-654-3210. Our headquarters and operational offices are managed through our wholly owned subsidiary, STMicroelectronics International N.V., and are located at 39 Chemin du Champ des Filles, 1228 Plan-les-Ouates, Geneva, Switzerland. Our main telephone number there is +41-22-929-2929. Our agent for service of process in the United States related to our registration under the U.S. Securities Exchange Act of 1934, as amended, is Corporation Service Company (CSC), 80 State Street, Albany, New York, 12207. Our operations are also conducted through our various subsidiaries, which are organized and operated according to the laws of their country of incorporation, and consolidated by STMicroelectronics N.V.

 

1.2.

Strategy and objectives

We are a global semiconductor leader, serving over 100,000 customers across a broad range of markets: automotive, industrial, personal electronics, and communications equipment, computers and peripherals. We develop industry-leading technologies that allow us to provide products and solutions that meet and exceed the needs and expectations of our customers now and into the future.

Our strategy focuses on long-term value creation for the Company and its affiliated enterprises and takes into account the short-, medium- and longer-term evolution of the markets we serve and the environment and opportunities we see.

We are focused on application areas which are expected to experience solid growth rates driven by broad, long-term trends in electronic systems. Key for us among these trends are Smart Mobility, power and energy applications, Internet of Things (“IoT”) and 5G. These trends require enablers such as autonomous systems, robotics, securely connected machines and personal devices, electrification of automobiles and infrastructure, advanced communications equipment and networks and more power efficient systems. These enablers drive in turn the demand for the electronic components we develop and manufacture.

Our products are used in a wide variety of applications for the four end-markets we address: automotive, industrial, personal electronics and communications equipment, computers and peripherals. For the automotive and industrial markets we address a wide customer base, particularly in industrial, with a broad and deep product portfolio. In personal electronics and communications equipment, computers and peripherals, we have a selective approach both in terms of the customers we serve, as well as in the technologies and products we offer.

Together with our customers we enable smarter driving by making vehicles safer, more environmentally friendly and more connected. We enable smart industry helping to make factories and workplaces more efficient, more flexible and safer. We enable smarter homes and cities making houses, buildings and city infrastructure more efficient, more convenient and more secure. We help make everything more intelligent, more connected and more secure. In doing this we ensure that ST is found everywhere microelectronics make a positive and innovative contribution to people’s lives. By getting more from technology to get more from life, ST stands for life.augmented.

 

 

 

STMicroelectronics Semi Annual Report 2020  

Corporate Overview      3

 

 


 

 

1.3.

Organizational structure

We are organized in a matrix structure with geographic regions interacting with product lines, both supported by shared technology and manufacturing operations and by central functions, designed to enable us to be closer to our customers and to facilitate communication among the R&D, production, marketing and sales organizations.

While STMicroelectronics N.V. is our parent company, we conduct our global business through STMicroelectronics International N.V. and also conduct our operations through service activities from our subsidiaries. We provide certain administrative, human resources, legal, treasury, strategy, manufacturing, marketing and other overhead services to our consolidated subsidiaries pursuant to service agreements for which we recover the cost.

 

1.4.

Products and activities

We are a global independent semiconductor company that designs, develops, manufactures and markets a broad range of products, including discrete and general purpose components, application-specific integrated circuits (“ASICs”), full-custom devices and semi-custom devices and application-specific standard products (“ASSPs”) for analog, digital and mixed-signal applications.

Our diverse product portfolio benefits from a unique, strong foundation of proprietary and differentiated leading-edge technologies. We use all of the prevalent function-oriented process technologies, including complementary metal-on silicon oxide semiconductors (“CMOS”), bipolar and non-volatile memory technologies. In addition, by combining basic processes, we have developed advanced systems-oriented technologies that enable us to produce differentiated and application-specific products, including our pioneering fully depleted silicon-on-insulator (“FD-SOI”) technology offering superior performance and power efficiency compared to bulk CMOS, bipolar CMOS technologies (“Bi-CMOS”) and radio frequency silicon-on-insulator (“RF-SOI”) for mixed-signal and high-frequency applications, as well as a combination of Bipolar, CMOS and DMOS (“BCD”) and vertically integrated power (“VIPower”) technologies for smart power applications, silicon carbide (“SiC”) and gallium-nitride (“GaN”) for high-efficiency systems, Micro-Electro-Mechanical Systems (“MEMS”) technologies for sensors and Actuators, embedded memory technologies for our microcontrollers and differentiated Imaging Technologies for our imaging solutions.

Our reportable segments are as follows:

 

Automotive and Discrete Group (ADG), comprised of dedicated automotive ICs (both digital and analog), and discrete and power transistor products for all market segments.

 

Analog, MEMS and Sensors Group (AMS), comprised of low-power high-end analog ICs (both custom and general purpose) for all markets, smart power products for Industrial, Computer and personal electronics markets, Touch Screen Controllers, Low Power Connectivity solutions (both wireline and wireless) for IoT, power conversion products, metering solutions for Smart Grid, specialized imaging sensors and modules, and all MEMS products for sensors or Actuators.

 

Microcontrollers and Digital ICs Group (MDG), comprised of general purpose and secure microcontrollers, EEPROM memories, Digital ASICs, Aerospace and Defense products including components for microwave and millimeter wave.

For the computation of the segments’ internal financial measurements, we use certain internal rules of allocation for the costs not directly chargeable to the segments, including cost of sales, selling, general and administrative expenses and a part of research and development expenses. In compliance with the our internal policies, certain costs are not allocated to the segments, but reported in “Others”. Those include impairment, restructuring charges and other related closure costs, management reorganization expenses, unused capacity charges, including reduced manufacturing activity due to COVID-19, phase-out and start-up costs of certain manufacturing facilities, certain one-time corporate items, strategic and special research and development programs or other corporate-sponsored initiatives, including certain corporate-level operating expenses, patent claims and litigations and certain other miscellaneous charges. In addition, depreciation and

 

 

STMicroelectronics Semi Annual Report 2020  

Corporate Overview      4

 

 


 

amortization expense is part of the manufacturing costs allocated to the segments and is neither identified as part of the inventory variation nor as part of the unused capacity charges; therefore, it cannot be isolated in the costs of goods sold. Finally, R&D grants are allocated to the segments proportionally to the incurred R&D expenses on the sponsored projects.

 

1.5.

Sales, Marketing and Distribution

Our sales and marketing is organized by a combination of country/area coverage and key accounts coverage with the primary objective of accelerating sales growth and gaining market share, particularly with regards to: strengthening the effectiveness of the development of our global and major local accounts; boosting demand creation through an enhanced focus on geographical coverage with strong technical expertise, supported in the mass market by our distribution channel and local initiatives; and establishing regional sales and marketing teams that are fully aligned with our strategic end-markets: automotive, industrial, personal electronics and communications equipment, computers and peripherals.

We have three regional sales organizations reporting to a global head of Sales & Marketing: Americas; Asia Pacific; and EMEA. Our regional sales organizations have a similar structure to enhance coordination in global strategy alignment and go-to-market activities. The sales and marketing teams are strongly focused on profitable revenue growth and business performance as well as on fostering demand, expanding the customer base, maximizing market share, developing new product-roadmaps and providing the best technical support in the field for our customers. The sales and marketing activities are supported by system marketing, product marketing, application labs, field application engineers and quality engineers.

 

1.6.

Research & Development

Since our formation, we have maintained a solid commitment to innovation.  About one-sixth of our employees work in R&D on product design/development and technology and, in 2019, we spent approximately 12.6% of our net revenues on R&D. Our innovations in semiconductor technology as well as in hardware and software contribute to the creation of successful products that generate value for us and our customers. Our complete design platforms, including a large selection of IP and silicon-proven models and design rules, enable the fast development of products designed to meet customer expectations in terms of reliability, quality, competitiveness in price and time-to-market. Through our R&D efforts, we contribute to making our customers’ products more efficient, more appealing, more reliable and safer. Our technology R&D strategy is based on the development of differentiated technologies, allowing for a unique offer in terms of new products and enabling new applications opportunities.

We draw on a rich pool of chip fabrication technologies, including advanced CMOS, FD-SOI, RF-SOI, specialized imaging, embedded non-volatile memories, mixed-signal, analog, MEMS, Smart power, SiC and GaN processes. This is well embedded in our strong packaging technologies portfolio such as high pin count BGA, Wafer level packaging, highly integrated sensor packages and leadframe package power products. We combine both front-end and back-end manufacturing and technology R&D under the same organization to ensure a smooth flow of information between our R&D and manufacturing organizations. We leverage significant synergies and shared activities between our product groups to cross-fertilize them. We also use silicon foundries, especially for advanced CMOS beyond the 28 nm node that we do not plan to manufacture nor develop internally.

 

 

STMicroelectronics Semi Annual Report 2020  

Corporate Overview      5

 

 


 

We have advanced R&D centers which offer us a significant advantage in quickly and cost effectively introducing products. Furthermore, we have established a strong culture of partnerships and through the years have created a network of strategic collaborations with key customers, suppliers, competitors, and leading universities and research institutes around the world. We also play leadership roles in numerous projects running under the European Union’s IST (Information Society Technologies) programs. We also participate in certain R&D programs established by the EU, individual countries and local authorities in Europe (primarily in France and Italy).

 

1.7.

Sustainability

Sustainability has been a guiding principle for ST for more than 25 years. In line with our vision to be everywhere microelectronics make a positive contribution to people’s lives, sustainability is deeply embedded in all of our activities. We believe that sustainability is fundamental to our business, brings new opportunities, improves efficiency, reduces risks and secures long-term profitability. It also brings benefits to our employees and our external stakeholders. Our approach to sustainability is expressed in our Code of Conduct, our policies and in our sustainability strategy.

At the heart of our sustainability strategy is an unceasing focus on what really matters for us and our stakeholders. We identify the most material topics for our stakeholders and their impacts on our business by carrying out an extensive materiality exercise every three to four years. For each material topic identified, we define a specific ambition and long-term goal. The related programs and performance indicators are presented throughout our sustainability report we publish each year and which is available at: www.st.com/company-reports.

We are included in many of the main sustainability indices, such as Dow Jones World and Europe Sustainability Indices, FTSE4Good and Ethibel, and recognized by CDP for our environmental management. In addition, as a member of the Responsible Business Alliance (RBA), we participate in the collective efforts of the industry to find solutions to our global sustainability challenges. We have been a signatory of the UN Global Compact since 2000. Our sustainability programs are aligned with its ten principles and contribute to ten of the 17 UN Sustainable Development Goals.

Further information on ST’s Sustainability approach can be found at: www.st.com/st-approach-to-sustainability.

 

 

 

 

STMicroelectronics Semi Annual Report 2020  

Corporate Overview      6

 

 


 

2.

Report of the Managing Board

 

2.1.

Business overview

The total available market is defined as the “TAM”, while the serviceable available market, the “SAM”, is defined as the market for products sold by us (which consists of the TAM and excludes major devices such as Microprocessors (“MPUs”), Dynamic random-access memories (“DRAMs”), optoelectronics devices, Flash Memories and the Wireless Application Specific market products such as Baseband and Application Processor).

Based on the data published by World Semiconductor Trade Statistics (WSTS), semiconductor industry revenues increased in the first half of 2020 on a year-over-year basis by approximately 6.0% for the TAM and 0.9% for the SAM to reach approximately $208 billion and $93 billion, respectively.

Our first half 2020 was impacted by a weak demand environment, especially in Automotive, as well as some continuing operational and logistics challenges due to governmental regulations related to the COVID-19 outbreak that started in the first quarter of 2020. During the second quarter of 2020, we returned to normal operations, supporting our customers’ demand and continuing to ensure the health and safety of our employees.

Our effective average exchange rate for the first half of 2020 was $1.11 for €1.00 compared to $1.15 for €1.00 for the first half of 2019.

Our first half 2020 revenues amounted to $4,318 million, a 1.6% increase on a year-over-year basis. By product group and year-over-year, the first half of 2020 ADG revenues were down 17.2% mainly due to Automotive and, to a lower extent, to Power Discrete. AMS revenues increased 18.4%, on strong growth in Imaging and, to a lower extent in Analog. MDG revenues increased 12.3% entirely driven by Microcontrollers.

Our first half 2020 gross margin reached 32.4% of revenues, representing a decrease of 140 basis points compared to the prior year period mainly due to higher unloading charges and usual price pressure.

Combined selling, general and administrative (SG&A) and research and development (R&D) expenses decreased to $1,135 million for the first half of 2020, compared to $1,141 million in the prior year period, positively impacted by favorable currency effects, partially offset by increased R&D activities.

In the first half of 2020, other income and expenses increased to a net income of $45 million, compared to a net income of $43 million in the prior year period, mainly due to higher income from R&D funding and higher gain on sale of non-current assets, partially offset by non-recurring expenses associated with the COVID-19 pandemic.

Operating profit in the first half of 2020 decreased by $27 million to $309 million compared to $336 million in the prior year period.

Combined finance income and costs resulted in a net income of $87 million in the first half of 2020, compared to a net cost of $116 million in the first half of 2019, and reflect in both periods the fair value measurement of convertible bonds. The first half of 2020 amount includes a net gain of $93 million for the fair value adjustment of outstanding convertible bond embedded options (compared to a net loss of $114 million in the first half of 2019).

Our Free Cash Flow (non GAAP measure) increased to positive $141 million in the first half of 2020 compared to negative $134 million in the year-ago period, mainly due to higher cash from operating activities and lower payment for purchase of tangible and intangible assets.

 

 

STMicroelectronics Semi Annual Report 2020  

Report of the Managing Board      7

 

 


 

 

2.2.

Segment information

We design, develop, manufacture and market a broad range of products, including discrete and standard commodity components, application-specific integrated circuits, full-custom devices and semi-custom devices and application-specific standard products for analog, digital and mixed-signal applications. In addition, we further participate in the manufacturing value chain of Smartcard products, which includes the production and sale of both silicon chips and Smartcards.

Our reportable segments are as follows:

 

Automotive and Discrete Group (ADG), comprised of dedicated automotive ICs (both digital and analog), and discrete and power transistor products for all market segments.

 

Analog, MEMS and Sensors Group (AMS), comprised of low-power high-end analog ICs (both custom and general purpose) for all markets, smart power products for Industrial, Computer and personal electronics markets, Touch Screen Controllers, Low Power Connectivity solutions (both wireline and wireless) for IoT, power conversion products, metering solutions for Smart Grid, specialized imaging sensors and modules, and all MEMS products for sensors or Actuators.

 

Microcontrollers and Digital ICs Group (MDG), comprised of general purpose and secure microcontrollers, EEPROM memories, Digital ASICs, Aerospace and Defense products including components for microwave and millimeter wave.

For the computation of the segments’ internal financial measurements, we use certain internal rules of allocation for the costs not directly chargeable to the segments, including cost of sales, selling, general and administrative expenses and a part of research and development expenses. In compliance with our internal policies, certain costs are not allocated to the segments, but reported in “Others”. Those include impairment, restructuring charges and other related closure costs, management reorganization expenses, unused capacity charges, including reduced manufacturing activity due to COVID-19, phase-out and start-up costs of certain manufacturing facilities, certain one-time corporate items, strategic and special research and development programs or other corporate-sponsored initiatives, including certain corporate-level operating expenses, patent claims and litigations and certain other miscellaneous charges. In addition, depreciation and amortization expense is part of the manufacturing costs allocated to the segments and is neither identified as part of the inventory variation nor as part of the unused capacity charges; therefore, it cannot be isolated in the costs of goods sold. Finally, R&D grants are allocated to the segments proportionally to the incurred R&D expenses on the sponsored projects.

Wafer costs are allocated to the segments based on actual cost. From time to time, with respect to specific technologies, wafer costs are allocated to segments based on market price.

Please refer to note 3.6.6 of the Semi Annual Financial Statements for further information.

 

 

STMicroelectronics Semi Annual Report 2020  

Report of the Managing Board      8

 

 


 

 

2.3.

Liquidity and financial position

We maintain a significant cash position and a low debt-to-equity ratio, which provide us with adequate financial flexibility. As in the past, our cash management policy is to finance our investment needs mainly with net cash generated from operating activities.

During the first half of 2020, our net cash decreased by $807 million, mainly due to net investments in short-term deposits of $685 million reported as net cash used in investing activities.

The components of our cash flow for the comparable periods are set forth below:

 

 

 

(unaudited)

 

In millions of USD

 

June 27,

2020

 

 

June 29,

2019

 

Net cash from operating activities

 

 

959

 

 

 

842

 

Net cash used in investing activities

 

 

(1,480

)

 

 

(952

)

Net cash from / (used in) financing activities

 

 

(282

)

 

 

26

 

Effect of change in exchange rates

 

 

(4

)

 

 

(3

)

Net cash increase (decrease)

 

 

(807

)

 

 

(87

)

 

Net cash from operating activities

Net cash from operating activities is the sum of (i) net income adjusted for non-cash items and (ii) changes in net working capital. The net cash from operating activities for the first half of 2020 was $959 million, increasing compared to $842 million in the first half of 2019, mainly due to higher net income and more favorable change in the net working capital.

Net cash used in investing activities

Investing activities used $1,480 million of cash in the first half of 2020, mainly as a result of net investments in short-term deposits of $685 million, payments for tangible assets, net of proceeds, for a total of $578 million and investment in intangible assets for $186 million of which the largest part is related to the capitalization of development costs.

Net cash from (used in) financing activities

Financing activities used $282 million in the first half of 2020, compared to positive $26 million in the first half of 2019, and consisted mainly of $125 million repurchase of common stock and $90 million dividends paid to stockholders.

 

 

STMicroelectronics Semi Annual Report 2020  

Report of the Managing Board      9

 

 


 

Free cash flow (non GAAP measure)

Free Cash Flow, which is a non GAAP measure, is defined as (i) net cash from operating activities plus (ii) net cash used in investing activities, excluding payment for purchases of (and proceeds from matured) marketable securities, and net investment in short-term deposits, which are considered as temporary financial investments. The result of this definition is ultimately net cash from operating activities plus payment for purchase (and proceeds from sale) of tangible, intangible and financial assets, proceeds received in the sale of businesses and cash paid for business acquisitions. We believe Free Cash Flow, a non GAAP measure, provides useful information for investors and management because it measures our capacity to generate cash from our operating and investing activities to sustain our operations. Free Cash Flow is not a GAAP measure and does not represent total cash flow since it does not include the cash flows generated by or used in financing activities. Free Cash Flow reconciles with the net cash increase (decrease) by including the payment for purchase of (and proceeds from matured) marketable securities and net investment in short-term deposits, the net cash from (used in) financing activities and the effect of changes in exchange rates. In addition, our definition of Free Cash Flow may differ from definitions used by other companies. Our Free Cash Flow is derived from the US GAAP Consolidated Statement of Cash Flows, which differs from the Consolidated Statement of Cash Flows under IFRS. A reconciliation with the Consolidated Statement of Cash Flows under IFRS is provided in the table below:

 

In millions of USD

 

June 27,

2020

 

 

June 29,

2019

 

Net cash from operating activities as reported

 

 

959

 

 

 

842

 

Excluding US GAAP/IFRS differences:

 

 

 

 

 

 

 

 

Payment for withholding tax on vested shares

 

 

6

 

 

 

4

 

Payment for leases

 

 

(28

)

 

 

(28

)

Other

 

 

(1

)

 

 

 

Net cash from operating activities adjusted

 

 

936

 

 

 

818

 

 

 

 

 

 

 

 

 

 

Net cash used in investing activities as reported

 

 

(1,480

)

 

 

(952

)

Excluding:

 

 

 

 

 

 

 

 

Payment for purchase and proceeds from matured marketable securities and

   net investment in short-term deposits

 

 

685

 

 

 

 

Payment for purchase and proceeds from sale of tangible, intangible assets,

   payment for business acquisitions (1)

 

 

(795

)

 

 

(952

)

Free Cash Flow (non GAAP measure)

 

 

141

 

 

 

(134

)

 

 

(1)

Reflects the total of the following line items reconciled with our Consolidated Statement of Cash Flows relating to investing activities: Payment for purchase of tangible assets, Proceeds from sale of tangible assets, Payment for purchase of intangible assets, Payment for purchase of financial assets, Proceeds from sale of financial assets, Proceeds received in sale of businesses, Payment for business acquisitions, net of cash and cash equivalents acquired.

Our free cash flow was positive $141 million for the first half of 2020, compared to negative $134 million for the first half of 2019.

 

 

STMicroelectronics Semi Annual Report 2020  

Report of the Managing Board      10

 

 


 

Net Financial Position (non GAAP measure)

Our Net Financial Position represents the difference between our total liquidity and our total financial debt. Our total financial resources include cash and cash equivalents, restricted cash, short-term deposits and quoted debt securities; our total financial debt includes interest-bearing loans and borrowings, including current portion, as represented in our consolidated statement of financial position. Net Financial Position is not a GAAP measure but we believe it provides useful information for investors and management because it gives evidence of our global position either in terms of net indebtedness or net cash by measuring our capital resources based on cash and cash equivalents, restricted cash, short-term deposits and quoted debt securities and the total level of our financial indebtedness. In addition, our definition of Net Financial Position may differ from definitions used by other companies and therefore comparability may be limited. Our Net Financial Position is derived from our US GAAP Consolidated Balance Sheets, which differs from the Consolidated Statement of Financial Position under IFRS. A reconciliation with the Consolidated Statement of Financial Position under IFRS is provided in the table below:

 

In millions of USD

 

June 27,

2020

 

 

December 31,

2019

 

Cash and cash equivalents

 

 

1,800

 

 

 

2,597

 

Restricted cash

 

 

 

 

 

10

 

Short-term deposits

 

 

687

 

 

 

4

 

Government bonds issued by the U.S. Treasury

 

 

134

 

 

 

133

 

Total liquidity

 

 

2,621

 

 

 

2,744

 

Funding program loans from European Investment Bank

 

 

(678

)

 

 

(706

)

Dual tranche senior unsecured convertible bonds

 

 

(1,371

)

 

 

(1,351

)

Other funding programs and other long-term loans

 

 

 

 

 

(12

)

Total financial debt as reported

 

 

(2,049

)

 

 

(2,069

)

US GAAP/IFRS differences on dual tranche senior unsecured convertible

   bonds valuation

 

 

(2

)

 

 

(3

)

Total financial debt adjusted

 

 

(2,051

)

 

 

(2,072

)

Net financial position (non GAAP measure)

 

 

570

 

 

 

672

 

 

Our Net Financial Position as of June 27, 2020 was a net cash position of $570 million, decreasing compared to the net cash position of $672 million at December 31, 2019.

At June 27, 2020, our financial debt was $2,049 million, composed of (i) $876 million of current portion of long-term debt and (ii) $1,173 million of long-term debt. The breakdown of our total financial debt included: (i) $1,371 million in the senior unsecured convertible bonds issued in 2017 and (ii) $678 million in European Investment Bank loans (the “EIB Loans”).

The EIB Loans are comprised of three long-term amortizing credit facilities as part of our R&D funding programs. The first, signed in 2010, is a €350 million multi-currency loan to support our industrial and R&D programs. It was drawn mainly in U.S. dollars for an amount of $321 million and only partially in Euros for an amount of €100 million, of which $55 million remained outstanding as of June 27, 2020. The second, signed in 2013, is a €350 million multi-currency loan which also supports our R&D programs. It was drawn in U.S. dollars for an amount of $471 million, of which $118 million is outstanding as of June 27, 2020. The third, signed in August 2017 is a €500 million loan in relation to R&D and capital expenditure investments in the European Union. It was fully drawn in Euros corresponding to $505 million outstanding as of June 27, 2020. Additionally, on February 2020, we entered in a new €500 million facility agreement with EIB to support R&D and Capex programs in Italy and France, undrawn as at June 27, 2020.

On July 3, 2017, we issued $1,500 million in principal amount of dual tranche senior unsecured convertible bonds (Tranche A for $750 million and Tranche B for $750 million), due 2022 and 2024, respectively. Tranche A bonds were issued at 101.265% as zero-coupon bonds while Tranche B bonds were issued at par and bear a 0.25% per annum nominal interest, payable semi-annually. The conversion price at issuance was $20.54, equivalent to a 37.5% premium on both tranches, which corresponds to 9,737 equivalent shares per each $200,000 bond par value. The bonds are convertible by the

 

 

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bondholders or are callable by the issuer upon certain conditions, on a net-share settlement basis, except if the issuer elects a full-cash or full-share conversion as an alternative settlement. The net proceeds from the bond offering were $1,502 million, after deducting issuance costs. The call option available to us for the early redemption of Tranche A was exercised in July 2020. We intend to settle Tranche A bonds upon conversion on a net share basis, by redeeming through cash the $750 million principal amount and by settling the residual consideration through the delivery of shares.

Our long-term debt contains standard conditions but does not impose minimum financial ratios. Committed credit facilities amounted to $1.1 billion as of June 27, 2020, including the new €500 million long-term line signed with the EIB in the first half of 2020, undrawn as at June 27, 2020.

Our current ratings with the three major rating agencies that report on us on a solicited basis, are as follows: S&P: “BBB” with stable outlook; Moody’s: “Baa3” with stable outlook; Fitch: “BBB” with stable outlook.

 

2.4.

Business and financial outlook

We expect net revenues for the full year 2020 to be in the range of about $9.25 to $9.65 billion.

Our policy is to modulate our capital spending according to the evolution of the semiconductor market. Based on current market visibility and its evolution, based on the capability to recover from COVID-19, the combination of new products, customer demand in 2020 and ongoing strategic initiatives, we confirm our capital investment in 2020 to approximately $1.2 billion. A portion of this capital expenditure will be devoted to support strategic initiatives: (i) in Agrate, Italy the construction of a new 300 mm fab to support next generation mixed signal, IGBT and power technologies; (ii) R&D for GaN power technologies in Tours 200 mm and prototyping for GaN RF devices in Catania 150 mm and (iii) investments for Silicon Carbide. These include the kick-off of substrates activities, following the Norstel acquisition. In addition to our strategic initiatives, our main capital investment in front-end is in (i) our 300 mm fab in Crolles, optimizing existing infrastructure to support production ramp up on our main runner technologies; (ii) mix evolution, and a few selected programs of capacity growth and infrastructure preparation in some of our most advanced 200 mm fabs. The most important 2020 capital investments for our back-end facilities are expected to be: (i) capacity growth on certain package families, including the SiC technology, next generation Imaging sensor technologies and new generation of Intelligent Power Modules (IPM) for Automotive and Industrial applications; (ii) modernization and rationalization of package lines targeting cost savings benefits; and (iii) specific investments in the areas of factory automation, quality, environment and energy savings. In addition, we will invest in overall capacity adjustment in final testing and wafers probing (EWS) to support demand and a changed product mix as well as invest in quality, safety, maintenance, productivity and cost savings in both 150 mm, 200 mm front-end fabs and back-end plants.

We will continue to invest to support revenues growth and new products introduction, taking into consideration factors such as trends in the semiconductor industry and capacity utilization. We expect to need significant financial resources in the coming years for capital expenditures and for our investments in manufacturing and R&D. We plan to fund our capital requirements from cash provided by operating activities, available funds and support from third parties, and may have recourse to borrowings under available credit lines and, to the extent necessary or attractive based on market conditions prevailing at the time, the issuance of debt, convertible bonds or additional equity securities. A substantial deterioration of our economic results, and consequently of our profitability, could generate a deterioration of the cash generated by our operating activities. Therefore, there can be no assurance that, in future periods, we will generate the same level of cash as in prior years to fund our capital expenditure plans for expanding/upgrading our production facilities, our working capital requirements, our R&D and manufacturing costs.

 

 

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We believe that we have the financial resources needed to meet our currently projected business requirements for the next twelve months, including capital expenditures for our manufacturing activities, working capital requirements, approved dividend payments and the repayment of our debts in line with their maturity dates.

 

2.5.

Other developments

On July 28, 2020, we launched and priced a $1.5 billion dual-tranche offering of new convertible bonds. The Bonds were launched in two $750 million tranches, one with a maturity of 5 years (47.5% conversion premium, negative 1.12% yield to maturity, 0% coupon) and the other with a maturity of 7 years (52.5% conversion premium, negative 0.63% yield to maturity, 0% coupon). Under the terms of the Bonds, we can satisfy the conversion rights either in cash or shares, or a combination of the two, at our selection. Proceeds from the issuance of the Bonds will be used for general corporate purposes, including the early redemption of the outstanding $750 million convertible bond due 2022. The issuance of the new Bonds occurred on August 4, 2020.

On July 28, 2020, we also announced the issuance of a redemption notice to inform bondholders that we will redeem all of the Tranche A bonds issued in July 2017 at their principal amount on August 27, 2020. We intend to settle the bonds through the payment of cash for the principal amount and the residual consideration through the delivery of shares. For such delivery of shares in connection with the net share settlement, we will use existing shares held as treasury shares as of June 27, 2020.

On July 16, we announced the signature of two M&A agreements related to the acquisitions of the entire share capital of Ultra Wide Band specialist BeSpoon and of the cellular IoT connectivity assets of Riot Micro. After closing of the two transactions, subject to customary regulatory approvals, we will further strengthen our offer for wireless connectivity and, in particular, the roadmap for our STM32 microcontrollers and secure MCUs.

On June 17, we held our Annual General Meeting of Shareholders (AGM) in Schiphol, the Netherlands. The main resolutions, approved by the Shareholders, were:

 

 

The adoption of the Company's statutory annual accounts for the year ended December 31, 2019, prepared in accordance with International Financial Reporting Standards (IFRS). The 2019 statutory annual accounts were filed with the Dutch Authority for the Financial Markets (AFM) on March 25, 2020 and are posted on the Company’s website (www.st.com) and on the AFM’s website (www.afm.nl);

 

The distribution of a cash dividend of $0.168 per outstanding share of the Company’s common stock, to be distributed in quarterly installments of $0.042 in each of the second, third and fourth quarters of 2020 and first quarter of 2021;

 

The authorization to the Supervisory Board to consider during September 2020 to increase such authorized dividend up to a maximum of $0.24 per outstanding share of the Company’s common stock;

 

The appointment of Ms. Ana de Pro Gonzalo as member of the Supervisory Board, for a three-year term expiring at the 2023 AGM, in replacement of Ms. Martine Verluyten whose mandate expired at the end of the 2020 AGM;

 

The appointment of Mr. Yann Delabrière as member of the Supervisory Board, for a three-year term expiring at the 2023 AGM, in replacement of Mr. Jean-Georges Malcor whose mandate expired at the end of the 2020 AGM;

 

The reappointment, for a three-year term expiring at the 2023 AGM, of the following members of the Supervisory Board: Ms. Heleen Kersten and Messrs. Alessandro Rivera, Frédéric Sanchez and Maurizio Tamagnini;

 

The adoption of the Company’s remuneration policy for the members of the Supervisory Board, in line with recent changes in Dutch corporate law and the EU’s shareholder rights directive; and

 

 

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The re-appointment of EY as external auditor for the 2020, 2021, 2022 and 2023 financial years.

Following the conclusion of the AGM, the members of the Supervisory Board appointed Mr. Maurizio Tamagnini as the Chairman and Mr. Nicolas Dufourcq as the Vice-Chairman of the Supervisory Board, respectively, for a 3-year term to expire at the end of the 2023 AGM.

On May 12, we announced the publication of our 2020 Sustainability Report.

On April 7, we closed the acquisition of a majority stake in French Gallium Nitride (GaN) innovator Exagan. The transaction was funded with available cash.

 

2.6.

Related party transactions

Please refer to note 3.6.19 of the Semi Annual Financial Statements.

 

2.7.

Financial Risk Management

We are exposed to changes in financial market conditions in the normal course of business due to our operations in different foreign currencies and our ongoing investing and financing activities. Market risk is the uncertainty to which future earnings or asset/liability values are exposed due to operating cash flows denominated in foreign currencies and various financial instruments used in the normal course of operations. The major financial risks to which we are exposed are the foreign exchange risks related to the fluctuations of the U.S. dollar exchange rate compared to the Euro and the other major currencies in which costs are incurred, the variation of the interest rates and the risks associated to the investments of our available cash. We have established policies, procedures and internal processes governing our management of market risks and the use of financial instruments to manage our exposure to such risks. See note 3.6.10.4 of the Semi Annual Financial Statements for further information.

Our financial risk management is carried out by a central treasury department (Corporate Treasury). Additionally, a Treasury Committee, chaired by our CFO, steers treasury activities and ensures compliance with our corporate policies. Treasury activities are thus regulated by our policies, which define procedures, objectives and controls. The policies focus on the management of financial risk in terms of exposure to market risk, credit risk and liquidity risk. Treasury controls are subject to internal audits. Most treasury activities are centralized, with any local treasury activities subject to oversight from Corporate Treasury. Corporate Treasury identifies, evaluates and hedges financial risks in close cooperation with our operating units. It provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, price risk, credit risk, use of derivative financial instruments, and investments of excess liquidity. The majority of cash and cash equivalents is held in U.S. dollars and Euros and is placed with financial institutions rated at least a single “A” long-term rating from two of the major rating agencies, meaning at least A3 from Moody’s Investor Service and A- from Standard & Poor’s and Fitch Ratings, or better. These ratings are closely and continuously monitored in order to manage exposure to the counterparty’s risk. Hedging transactions are performed only to hedge exposures deriving from operating, investing and financing activities conducted in the normal course of business.

The Semi Annual Financial Statements do not include all financial risk management information and disclosures required in the annual financial statements; they should be read in conjunction with the Group’s annual consolidated financial statements as at December 31, 2019. There have been no changes in the risk management department or in any risk management policies since year end.

Foreign exchange risk

We conduct our business on a global basis in various major international currencies. As a result, we are exposed to adverse movements in foreign currency exchange rates, primarily with respect to the Euro. Foreign exchange risk mainly arises from recognized assets and liabilities at our subsidiaries and future commercial transactions.

 

 

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Cash flow and fair value interest rate risk

Our interest rate risk arises from long-term borrowings. Borrowings issued at variable rates expose us to cash flow interest rate risk. Borrowings issued at fixed rates expose us to fair value interest rate risk.

Credit risk

We select banks and/or financial institutions that operate with the Group based on the criteria of long-term rating from at least two major rating agencies and keeping a maximum outstanding amount per instrument with each bank not to exceed 20% of the total.

We monitor the creditworthiness of our customers to which we grant credit terms in the normal course of business. If certain customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set based on internal and external ratings in accordance with limits set by management. The utilization of credit limits is regularly monitored.

Liquidity risk

Prudent liquidity risk management includes maintaining sufficient cash equivalents and marketable securities, the availability of funding from committed credit facilities and the ability to close out market positions. Our objective is to maintain a significant cash position and a low debt-to-equity ratio, which ensures adequate financial flexibility. Our liquidity management policy is to finance our investments with net cash generated from operating activities.

 

2.8.

Business risk information

Our risk appetite depends on the nature of risks. We determine, on a regular basis, the amount of risk we are willing to eliminate, mitigate, pursue or retain, depending on associated expected rewards, opportunities and cost of risk optimization.

Below is a list of the main risk factors related to the semiconductor industry and specifically related to our operations, which may affect our result and performance and the ability of management to predict the future:

 

Changes in global trade policies, including the adoption and expansion of tariffs and trade barriers, that could affect the macro-economic environment and adversely impact the demand for our products;

 

Uncertain macro-economic and industry trends, which may impact end-market demand for our products;

 

Customer demand that differs from projections;

 

The ability to design, manufacture and sell innovative products in a rapidly changing technological environment;

 

Changes in economic, social, public health, labor, political, or infrastructure conditions in the locations where we, our customers, or our suppliers operate, including as a result of macroeconomic or regional events, military conflicts, social unrest, labor actions, or terrorist activities;

 

Unanticipated events or circumstances, which may impact our ability to execute our plans and/or meet the objectives of our R&D and manufacturing programs, which benefit from public funding;

 

The Brexit vote and the impact of the withdrawal of the U.K. may adversely affect business activity, political stability and economic conditions in the U.K., the Eurozone, the EU and elsewhere. The U.K. withdrawal from the EU took place on January 31, 2020 and the UK majority government is expected to complete Brexit even if no formal withdrawal agreement is in place with the EU by the end of the transition period running until December 31, 2020. The specific terms of the U.K. withdrawal from the EU are still uncertain and while we do not have material operations in the U.K. and have not experienced any material impact from Brexit on our underlying business to date, we cannot predict its future implications;

 

 

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Financial difficulties with any of our major distributors or significant curtailment of purchases by key customers;

 

The loading, product mix, and manufacturing performance of our production facilities and/or our required volume to fulfill capacity reserved with suppliers or third party manufacturing providers;

 

Availability and costs of equipment, raw materials, utilities, third-party manufacturing services and technology, or other supplies required by our operations;

 

The functionalities and performance of our IT systems, which are subject to cybersecurity threats and which support our critical operational activities including manufacturing, finance and sales, and any breaches of our IT systems or those of our customers or suppliers;

 

Theft, loss, or misuse of personal data about our employees, customers, or other third parties, and breaches of global and local privacy legislation, including the EU’s General Data Protection Regulation (“GDPR”);

 

The impact of intellectual property (“IP”) claims by our competitors or other third parties, and our ability to obtain required licenses on reasonable terms and conditions;

 

Changes in our overall tax position as a result of changes in tax rules, new or revised legislation, the outcome of tax audits or changes in international tax treaties which may impact our results of operations as well as our ability to accurately estimate tax credits, benefits, deductions and provisions and to realize deferred tax assets;

 

Variations in the foreign exchange markets and, more particularly, the U.S. dollar exchange rate as compared to the Euro and the other major currencies we use for our operations;

 

The outcome of ongoing litigation as well as the impact of any new litigation to which we may become a defendant;

 

Product liability or warranty claims, claims based on epidemic or delivery failure, or other claims relating to our products, or recalls by our customers for products containing our parts;

 

Natural events such as severe weather, earthquakes, tsunamis, volcano eruptions or other acts of nature, the effects of climate change, health risks and epidemics such as the novel coronavirus COVID-19 in locations where we, our customers or our suppliers operate;

 

Industry changes resulting from vertical and horizontal consolidation among our suppliers, competitors, and customers; and

 

The ability to successfully ramp up new programs that could be impacted by factors beyond our control, including the availability of critical third party components and performance of subcontractors in line with our expectations.

 

2.9.

Auditor’s involvement

The Interim Condensed Consolidated Financial Statements and Interim Report of the Managing Board have not been audited or reviewed by an external auditor.

This report of the Managing Board is dated August 19, 2020.

 

 

 

 

 

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3.

Interim Condensed Consolidated Financial Statements (“Semi Annual Financial Statements”)

The Semi Annual Financial Statements of the Group for the six months ended June 27, 2020, as presented by the Managing Board, have not been audited nor reviewed by an external auditor.

 

3.1.

Consolidated income statement

 

 

 

 

 

(unaudited)

 

 

 

 

 

Six-month period ended

 

In millions of USD, except per share amounts

 

Notes

 

June 27, 2020

 

 

June 29, 2019

 

Sales

 

 

 

 

4,312

 

 

 

4,232

 

Other revenues

 

 

 

 

6

 

 

 

17

 

Total revenues

 

3.6.5

 

 

4,318

 

 

 

4,249

 

Cost of sales

 

3.6.16

 

 

(2,919

)

 

 

(2,815

)

Gross profit

 

 

 

 

1,399

 

 

 

1,434

 

Selling, general and administrative

 

3.6.16

 

 

(534

)

 

 

(548

)

Research and development

 

3.6.16

 

 

(601

)

 

 

(593

)

Other income

 

3.6.17

 

 

76

 

 

 

58

 

Other expenses

 

3.6.17

 

 

(31

)

 

 

(15

)

Operating profit

 

 

 

 

309

 

 

 

336

 

Finance income

 

 

 

 

128

 

 

 

45

 

Finance costs

 

 

 

 

(41

)

 

 

(161

)

Share of profit (loss) of joint ventures

 

 

 

 

 

 

 

1

 

Profit before income tax

 

 

 

 

396

 

 

 

221

 

Income tax expense

 

 

 

 

(21

)

 

 

(40

)

Net profit

 

 

 

 

375

 

 

 

181

 

Attributable to:

 

 

 

 

 

 

 

 

 

 

The equity holders of the parent

 

 

 

 

376

 

 

 

180

 

Non-controlling interests

 

 

 

 

(1

)

 

 

1

 

Net profit

 

 

 

 

375

 

 

 

181

 

Earnings per share attributable to the equity holders of the parent

 

 

 

 

 

 

 

 

 

 

Earnings per share (Basic)

 

3.6.18

 

 

0.42

 

 

 

0.20

 

Earnings per share (Diluted)

 

3.6.18

 

 

0.42

 

 

 

0.20

 

 

The accompanying notes are an integral part of these interim consolidated financial statements

 

 

STMicroelectronics Semi Annual Report 2020  

Semi Annual Financial Statement      17

 

 


 

 

3.2.

Consolidated statement of comprehensive income

 

 

 

(unaudited)

 

 

 

Six-month period ended

 

In millions of USD

 

June 27, 2020

 

 

June 29, 2019

 

Net result

 

 

375

 

 

 

181

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

Items that will not be reclassified to profit or loss

 

 

 

 

 

 

 

 

Re-measurements of employee benefit obligations

 

 

(7

)

 

 

(36

)

Income tax effect

 

 

 

 

 

6

 

Re-measurements of employee benefit obligations, net of tax

 

 

(7

)

 

 

(30

)

Total items that will not be reclassified to profit or loss

 

 

(7

)

 

 

(30

)

 

 

 

 

 

 

 

 

 

Items that may be subsequently reclassified to profit or loss

 

 

 

 

 

 

 

 

Exchange differences on translation of foreign operations

 

 

(11

)

 

 

(14

)

Cash flow hedges

 

 

5

 

 

 

11

 

Income tax effect

 

 

(1

)

 

 

(2

)

Net movement on cash flow hedges

 

 

4

 

 

 

9

 

Changes in fair value of debt instruments at FVOCI

 

 

1

 

 

 

3

 

Income tax effect

 

 

 

 

 

 

Net changes in fair value of debt instruments at FVOCI

 

 

1

 

 

 

3

 

Total items that may be reclassified subsequently to profit or loss

 

 

(6

)

 

 

(2

)

Other comprehensive income (loss), net of tax

 

 

(13

)

 

 

(32

)

 

 

 

 

 

 

 

 

 

Total comprehensive income (loss), net of tax

 

 

362

 

 

 

149

 

 

 

 

 

 

 

 

 

 

Attributable to:

 

 

 

 

 

 

 

 

The equity holders of the parent

 

 

363

 

 

 

148

 

Non-controlling interests

 

 

(1

)

 

 

1

 

Total comprehensive income (loss), net of tax

 

 

362

 

 

 

149

 

 

The accompanying notes are an integral part of these interim consolidated financial statements

 

 

STMicroelectronics Semi Annual Report 2020  

Semi Annual Financial Statement      18

 

 


 

 

3.3.

Consolidated statement of financial position

 

In millions of USD

 

Notes

 

June 27, 2020

(unaudited)

 

 

December 31,

2019

 

Assets

 

 

 

 

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment

 

3.6.7

 

 

4,386

 

 

 

4,219

 

Goodwill

 

3.6.9

 

 

179

 

 

 

144

 

Intangible assets

 

3.6.7

 

 

1,202

 

 

 

1,191

 

Other non-current financial assets

 

3.6.10.1

 

 

104

 

 

 

57

 

Deferred tax assets

 

 

 

 

428

 

 

 

387

 

Other non-current assets

 

 

 

 

513

 

 

 

414

 

Total non-current assets

 

 

 

 

6,812

 

 

 

6,412

 

Current assets

 

 

 

 

 

 

 

 

 

 

Inventories

 

3.6.12

 

 

1,964

 

 

 

1,693

 

Trade accounts receivable

 

 

 

 

1,170

 

 

 

1,380

 

Other current financial assets

 

3.6.10.1

 

 

226

 

 

 

156

 

Other receivable and assets

 

 

 

 

430

 

 

 

434

 

Short-term deposits

 

 

 

 

687

 

 

 

4

 

Restricted cash

 

 

 

 

 

 

 

10

 

Cash and cash equivalents

 

3.6.13

 

 

1,800

 

 

 

2,597

 

Total current assets

 

 

 

 

6,277

 

 

 

6,274

 

Total assets

 

 

 

 

13,089

 

 

 

12,686

 

Equity

 

 

 

 

 

 

 

 

 

 

Equity attributable to the equity holders of the parent

 

 

 

 

7,245

 

 

 

7,086

 

Non-controlling interests

 

 

 

 

67

 

 

 

68

 

Total equity

 

3.6.14

 

 

7,312

 

 

 

7,154

 

Non-current liabilities

 

 

 

 

 

 

 

 

 

 

Interest-bearing loans and borrowings

 

3.6.10.3

 

 

1,173

 

 

 

1,200

 

Other non-current financial liabilities

 

3.6.10.2

 

 

529

 

 

 

532

 

Employee benefits

 

 

 

 

584

 

 

 

566

 

Deferred tax liabilities

 

 

 

 

51

 

 

 

31

 

Non-current provisions

 

 

 

 

1

 

 

 

1

 

Other non-current liabilities

 

 

 

 

113

 

 

 

94

 

Total non-current liabilities

 

 

 

 

2,451

 

 

 

2,424

 

Current liabilities

 

 

 

 

 

 

 

 

 

 

Interest-bearing loans and borrowings – current portion

 

3.6.10.3

 

 

876

 

 

 

869

 

Trade accounts payable

 

 

 

 

1,079

 

 

 

950

 

Other payables and accrued liabilities

 

 

 

 

355

 

 

 

260

 

Employee benefits – current portion

 

 

 

 

547

 

 

 

572

 

Current provisions

 

 

 

 

13

 

 

 

13

 

Other current financial liabilities

 

3.6.10.2

 

 

387

 

 

 

392

 

Income tax payable

 

 

 

 

69

 

 

 

52

 

Total current liabilities

 

 

 

 

3,326

 

 

 

3,108

 

Total equity and liabilities

 

 

 

 

13,089

 

 

 

12,686

 

 

The accompanying notes are an integral part of these interim consolidated financial statements

 

 

 

 

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3.4.

Consolidated statement of changes in equity

For the six-month period ended June 27, 2020

 

In millions of USD

 

Ordinary

shares

 

 

Capital

surplus

 

 

Treasury

shares

 

 

Other

reserves

 

 

Retained

earnings

 

 

Equity

attributable

to the equity

holders of

the parent

 

 

Non-

controlling

interests

 

 

Total

equity

 

As at January 1, 2020

 

 

1,157

 

 

 

2,189

 

 

 

(328

)

 

 

1,317

 

 

 

2,751

 

 

 

7,086

 

 

 

68

 

 

 

7,154

 

Net profit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

376

 

 

 

376

 

 

 

(1

)

 

 

375

 

Other comprehensive income, net of tax

 

 

 

 

 

 

 

 

 

 

 

(13

)

 

 

 

 

 

(13

)

 

 

 

 

 

(13

)

Total comprehensive income

 

 

 

 

 

 

 

 

 

 

 

(13

)

 

 

376

 

 

 

363

 

 

 

(1

)

 

 

362

 

Transfer of cash flow hedge reserve to inventories

 

 

 

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

2

 

 

 

 

 

 

2

 

Repurchase of common stock

 

 

 

 

 

 

 

 

(125

)

 

 

 

 

 

 

 

 

(125

)

 

 

 

 

 

(125

)

Employee share award scheme, net of tax

 

 

 

 

 

 

 

 

81

 

 

 

70

 

 

 

(81

)

 

 

70

 

 

 

 

 

 

70

 

Dividends

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(151

)

 

 

(151

)

 

 

 

 

 

(151

)

As at June 27, 2020 (unaudited)

 

 

1,157

 

 

 

2,189

 

 

 

(372

)

 

 

1,376

 

 

 

2,895

 

 

 

7,245

 

 

 

67

 

 

 

7,312

 

 

The accompanying notes are an integral part of these interim consolidated financial statements

 

 

STMicroelectronics Semi Annual Report 2020  

Semi Annual Financial Statements      20

 

 


 

For the six-month period ended June 29, 2019

 

In millions of USD

 

Ordinary

shares

 

 

Capital

surplus

 

 

Treasury

shares

 

 

Other

reserves

 

 

Retained

earnings

 

 

Equity

attributable

to the equity

holders of

the parent

 

 

Non-

controlling

interests

 

 

Total

equity

 

As at January 1, 2019

 

 

1,157

 

 

 

2,185

 

 

 

(141

)

 

 

1,221

 

 

 

2,640

 

 

 

7,062

 

 

 

65

 

 

 

7,127

 

Net profit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

180

 

 

 

180

 

 

 

1

 

 

 

181

 

Other comprehensive income, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(32

)

 

 

 

 

 

(32

)

 

 

 

 

 

(32

)

Total comprehensive income

 

 

 

 

 

 

 

 

 

 

 

(32

)

 

 

180

 

 

 

148

 

 

 

1