Electronic Materials Division had a good year increasing its operating profit by 30% to £40.1 million. Growth was led by Wafer Fabrication Materials Group while the Semiconductor Packages Group, which has been the focus of considerable investment in recent years, made a contribution for the first time.
Wafer Fabrication Materials Group
Wafer Fabrication Materials Group (WFMG) had an excellent year achieving strong growth in sales and profits despite only a modest expansion in the electronic materials market. The group increased its sputtering target market share, particularly in the USA, Taiwan and Korea and now has over 40% worldwide. This was achieved through technology leadership in advanced targets for 8 inch wafer systems, reduced lead times and a focus on customer service. New target plants are under construction in the UK and Taiwan.
The Alta Group saw strong growth following last year's collapse in the DRAM market and consolidated its position as the world's leading supplier of high purity titanium. During the year Alta's non-titanium materials portfolio expanded to account for 15% of revenues. WFMG is well positioned to meet the demands of emerging 300mm silicon wafer processing technology and has the capacity to provide key new materials, such as copper, tantalum and cobalt, for the next generation of targets.
Assembly Products Group
Profits in Assembly Products Group were flat despite a faster than expected decline in die attach paste sales as customers moved from ceramic to plastic semiconductor packages. However, new low alpha lead and plastic die attach products came through in the second half of the year and a full recovery in this business is now under way.
Spokane had a very successful year driven by the launch of new aluminium based thermal management materials which disperse the heat generated by today's powerful microprocessors. During the year a new 106,000 square foot manufacturing facility for these products was established in Cheney, Washington (some 30 miles from Spokane). Johnson Matthey is one of the world's top three suppliers of thermal plates and heat sinks to the microelectronics industry.
Laminate Products Group
Johnson Matthey Advanced Circuits, Inc. (JMACI) achieved continued sales growth in 1997/98 although profits were flat largely due to tough market conditions in the second half. Telecommunications was the main growth driver with JMACI benefiting from rapid expansion in wireless communications, particularly in the USA, Mexico and Brazil.
The business has invested in a new 65,000 square foot manufacturing facility in Buffalo, Minnesota to serve growing demand, while major modifications are under way at the Hopkins and St. Louis Park plants to meet future capacity and technology needs of JMACI customers.
Major growth in hand-held electronics has fuelled demand for lighter, smaller and faster printed circuit boards (PCBs) which require high density interconnect technology. With its ability to produce boards with high layer counts, complex circuitry and a wide range of via interconnects between layers, JMACI is well positioned to become the number one US based supplier of high technology PCBs.
Semiconductor Packages Group
The Semiconductor Packages Group made good progress in 1997/98 and is the largest supplier of plastic laminate packages (PLPs) to the semiconductor industry outside Japan. The state of the art Chippewa Falls facility rapidly ramped up production of complex, ten layer, thermally enhanced, cavity packages and yields improved significantly. The group is a key PLP supplier to the world's largest microprocessor manufacturer and early in 1998/99 expects to increase market share by qualifying additional customers.
As the industry continues to move toward smaller chips, the next generation of 'flip chip' packages will replace traditional wire bonded formats. This transition requires new technologies. Through its cross-licensing agreement with Kyocera Corporation for advanced high density build up technology, Johnson Matthey is ideally positioned to remain a market leader in PLPs. The group also maintained its leadership position in ultra high layer PCBs for supercomputers.
| RESEARCH AND DEVELOPMENT
EMD's research and development activities, which maintain the division at the leading edge of electronic materials technology, are carried out in facilities at Minneapolis, Spokane, San Diego and Fombell, USA and Naoetsu, Japan. Heat dissipation and transfer is a major challenge for both packaging and components in today's powerful electronic devices. The division has designed a number of novel solutions, including an innovative thermal interface material with oriented, high thermal conductivity fibres in a polymer matrix which is generating much customer interest.
New methods of forming vias are being pioneered at our mass lamination products facility in Minneapolis for the manufacturing of the high density interconnect, multilayer PCBs needed to meet the challenges of speed, size and cost presented by new electronic products.
Modelling techniques are widely used to optimise design and production methodologies for the new generation of 300mm sputtering targets. New chemical production methods have been developed for high purity cobalt, tantalum and copper aimed at future generations of sputtering applications.
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