(Yicai Global) Feb. 5 -- Shares of Semiconductor Manufacturing International Corporation tumbled after China’s biggest chipmaker said “risks and uncertainties” surround its earnings guidance for this year because of US sanctions.

SMIC [HKG: 0981] ended down 10.3 percent in Hong Kong today at HKD24.50 (USD3.16), while its Shanghai-listed stock [SHA: 688981] lost 4.8 percent to CNY52.06 (USD8.04).

“Looking to 2021, as SMIC was placed on the US Entity List, the company is restricted from procuring related US items or technologies; so, there are risks and uncertainties to our annual forecasts,” Chief Financial Officer Gao Yonggang said in a statement to accompany the release of the company’s fourth-quarter and annual earnings results yesterday.

Shanghai-based SMIC forecasts “mid-to-high single digit percentage growth” in revenue this year, Gao said, compared with a 24.5 percent gain to USD3.9 billion last year. Net profit more than tripled to USD716 million in 2020.

“The forecast we give today assumes that operational continuity is not significantly adversely affected,” Gao said. “Export license application processes must be followed, they take time and will face uncertainty.”

The firm said in December that it had been added to the US commerce department’s so-called Entity List, a catalog of firms barred from doing business with American companies without special permission. The move would stunt its development and ability to build advanced 10-nanometer and under processes, SMIC said at the time.

SMIC expects revenue to increase between 5 percent and 9 percent this quarter from the fourth-quarter of 2020. In the first half, income could tally about USD2.1 billion.

The company is cutting costs. It expects to spend USD4.3 billion this year, mostly on technologies above 28 nanometers, and the remainder on smaller chips, as well as a new joint venture project in Beijing. Last year’s capital expenditure stood at USD6.7 billion.

In the fourth quarter ended Dec. 31, the chipmaker almost doubled net profit to CNY1.3 billion on rising sales and prices, it said in a filing to the Shanghai Stock Exchange. Some profit drivers were government projects and increasing income from joint ventures and financial assets, it added.

Under International Financial Reporting Standards, last quarter’s revenue was USD981.1 million, compared with USD839.4 million a year earlier. Profit attributable to the company was USD716 million, a threefold increase on a yearly basis.

Editor: Emmi Laine, Xiao Yi