China-based pure-play foundry Semiconductor Manufacturing International (SMIC) has reported revenues grew 6.4% on year to a record high of US$3.1 billion in 2017. Net profits, however, declined 52% from 2016 levels to US$180 million.

SMIC decided not to distribute any dividend for 2017, when the company generated earnings per ADS of US$0.04.

An increase in wafer shipments led to the 6.4% revenue increase in 2017, SMIC said. The foundry shipped a total of about 4.31 million 8-inch equivalent wafers in 2017, up 8.9% from 3.96 million units in 2016. Despite the shipment growth, SMIC's wafer ASP fell to US$719 from US$736 in 2016.

Meanwhile, 45nm and more advanced process technologies as a proportion of company revenues climbed to 28.8% in 2017 from 24% in 2016. In particular, SMIC continued, revenues from 28nm grew to account for a record-high 8% of the foundry's total wafer revenues in 2017.

SMIC's gross margin slid to 23.9% in 2017 from 29.2% in 2016, due mainly to rising depreciation costs and lower capacity utilization rates.

SMIC posted profits of US$124.9 million from operations for 2017, down from US$339.2 million in 2016. The company disclosed its R&D expenses grew 34.2% on year to US$427.1 million in 2017 while other expenses also increased.

For 2018, SMIC is targeting high single-digit revenue growth with a 10-20% gross margin. The company also approved its capex plan for 2018 under which US$1.9 billion will be spent for its foundry operations compared with US$2.4 billion in 2017.