UMC Reports Fourth Quarter 2012 Results

Company to enhance advanced processes and long-term competitiveness

(PRNewswire) —

Fourth Quarter 2012 Overview[Note 1]:

  • Revenue: declined 8.5% QoQ to NT$26.09 billion (US$898.66 million)
  • Gross margin: 16.8%; operating margin: 3.7%
  • Capacity utilization: 80%
  • Net income: NT$1.17 billion (US$40.41 million)
  • Earnings per share: NT$0.09; earnings per ADS: US$0.016

Note 1: 

Unless otherwise stated, all financial figures discussed in this announcement are prepared in accordance with ROC GAAP, which differ in some material respects from generally accepted accounting principles in the United States.  They are un-audited, unconsolidated, and represent comparisons among the three-month period ending Dec 31, 2012, the three-month period ending Sep 30, 2012, and the equivalent three-month period that ended Dec 31, 2011.  For all 4Q12 results, New Taiwan Dollar (NT$) amounts have been converted into U.S. Dollars at the Dec 31, 2012 exchange rate of NT$29.03 per U.S. Dollar.

United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) ("UMC" or "The Company"), a leading global semiconductor foundry, today announced its unconsolidated operating results for the fourth quarter of 2012.

Revenue was NT$26.09 billion, an 8.5% quarter-over-quarter decrease from NT$28.53 billion in 3Q12, and a 6.8% year-over-year increase from NT$24.43 billion in 4Q11.  Gross margin was 16.8%, operating margin was 3.7%, net income was NT$1.17 billion, and earnings per ordinary share were NT$ 0.09.  In 2012, revenue for the full year was NT$106.00 billion, with NT$9.08 billion operating income, NT$7.92 billion net income and NT$0.63 earnings per share.

Mr. Po-Wen Yen, UMC's newly appointed CEO, said, "In 4Q 2012, both UMC's revenue and gross profit were in line with expectations.  Quarter-over-quarter revenue decline was primarily attributed to decreased wafer shipments.  A total of 1.07 million 8-inch equivalent wafers were shipped, with overall capacity utilization at 80%.  Due to the impact from declining wafers shipments and currency appreciation, gross margin for the quarter was 16.8%.  Revenue contribution from 40nm continued its sequential increase to 15%, reaching our internal target."

CEO Yen continued, "As industry competition intensifies, the bar has been raised with regard to customer expectations for leading-edge technology products' time to market and foundry service flexibility.  As UMC's newly appointed CEO, my first priority is to enhance R&D for advanced processes.  In order to realize maximum benefits from our R&D efforts, we will increase internal resources while leverage outside collaboration so that we may effectively integrate R&D with manufacturing to ensure timely delivery of key projects.  For example, UMC's FinFET development began in 2010, and was bolstered in 2012 through a cooperative licensing agreement with IBM for their fundamental FinFET technology.  Our FinFET development team has since been making good progress.  Meanwhile, UMC recently demonstrated the world's first TSV-enabled 3DIC chip stacking technology developed under an open ecosystem collaboration.  The 3DIC, developed with an OSAT partner, reached a major milestone by passing package-level reliability assessment.  This successful collaboration reaffirms our strong commitment to elevating technology capabilities in order to fulfill the promise of providing high value-added services to customers.  UMC's operating results can be further enhanced through management's team effort to increase capacity, control cost, and expand our customer base.   Although UMC's 28nm ramp has been slower than anticipated, we remain dedicated to advanced technology development and timely capacity deployment to serve our customers' needs.  Equally important is our customers' unwavering commitment to bringing their new and existing 28nm products to fruition at UMC."      

CEO Yen added, "In the short-term, we continue to see elevated demand uncertainty from customers, along with supply chain inventory that will need additional time to digest.  When demand recovers, we are optimistic about the growth momentum from the strong mobile communications segment.  2013 is a critical year for UMC to demonstrate continuous success. In addition to acquiring Hejian Technology's operation, which will help UMC expand in the China market and broaden the company's operating scale, we will continue to invest appropriate capex to further our advanced process R&D and expand leading-edge capacity.  These endeavors will help expedite company growth and strengthen competitiveness to enhance UMC and its customers' overall value while increasing shareholders' equity."  

Summary of Operating Results

Operating Results

(Amount: NT$ million)

4Q12

3Q12

QoQ %
change

4Q11

YoY %
change

Revenue

26,088

28,525

(8.5)

24,425

6.8

Gross Profit

4,372

6,850

(36.2)

4,550

(3.9)

Operating Expenses

(3,409)

(3,238)

5.3

(3,710)

(8.1)

Operating Income

963

3,612

(73.3)

840

14.6

Non-Operating Income

391

83

371.1

149

162.4

Net Income

1,173

2,417

(51.5)

980

19.7

EPS   (NT$ per share)

0.09

0.19


0.08


         (US$ per ADS[Note 2])

0.016

0.033


0.014


Note 2: One ADS represents five Taiwan-listed ordinary shares.


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