UMC Reports Third Quarter 2014 Results

 

(1) Computer consists of ICs such as CPU, GPU, HDD controllers, DVD/CD-RW control ICs, PC chipset, audio codec, keyboard controller, monitor scaler, USB, I/O chipset. Communication consists of handset components, broadband, WLAN, bluetooth, Ethernet, LAN, DSP, etc. Consumer consists of ICs used for DVD players, DTV, STB, MP3/MP4, flash controller, game consoles, DSC, smart cards, toys, etc.


[2] Revenue in this section represents wafer sales

Blended ASP Trend for Foundry Segment

Blended average selling price (ASP) remained flat in 3Q14.
(To view ASP trend, visit http://www.umc.com/english/investors/3Q14_ASP_trend.asp)

Shipment and Utilization Rate[3] for Foundry Segment

Wafer shipments increased 2.5% quarterly to 1,462K in 3Q14, bringing overall utilization rate to 93%.

Wafer Shipments


3Q14

2Q14

1Q14

4Q13

3Q13

Wafer Shipments

1,462

1,426

1,258

1,236

1,329

(8" K equivalents)


Quarterly Capacity Utilization Rate


3Q14

2Q14

1Q14

4Q13

3Q13

Utilization Rate

93%

90%

81%

79%

87%

Total Capacity

1,586

1,597

1,563

1,560

1,548

(8" K equivalents)

 

[3] Utilization Rate = Quarterly Wafer Out / Quarterly Capacity

Capacity[4] for Foundry Segment

Capacity during the third quarter was 1,586K 8-inch equivalent wafers. The difference of 11K 8-inch equivalent wafers during 3Q14 compared to 2Q14 was primarily due to the change in capacity profile at Fab8D and the capacity upgrades at Fab12i. Fourth quarter¡¦s estimated capacity will be approximately 1,577K 8-inch equivalent wafer, the net result of 28nm capacity expansion at Fab12A with current capacity upgrades at Fab12i.

Annual Capacity in

thousands of wafers


Quarterly Capacity in

thousands of wafers

FAB

Geometry
(um)

2013

2012

2011

2010


FAB

4Q14E

3Q14

2Q14

1Q14

Fab6A

6"

3.5 - 0.45

448

481

538

588


Fab6A

113

113

113

111

Fab8A

8"

0.5 - 0.25

813

815

813

816


Fab8A

204

204

204

201

Fab8C

8"

0.35 - 0.11

347

360

359

366


Fab8C

87

87

87

86

Fab8D

8"

0.13 - 0.09

382

371

364

314


Fab8D

86

86

93

94

Fab8E

8"

0.5 - 0.18

418

449

469

410


Fab8E

105

105

105

103

Fab8F

8"

0.18 - 0.11

388

389

388

388


Fab8F

98

98

98

96

Fab8S

8"

0.18 - 0.11  

335

348

307

304


Fab8S

84

84

84

83

Fab8N

8"

0.5 -0.13    

469

-

-

-


Fab8N

140

140

140

126

Fab12A

12"

0.18 - 0.028

651

579

501

374


Fab12A

180

174

174

171

Fab12i

12"

0.13 - 0.040

550

537

530

454


Fab12i

135

145

147

145

Total (1)  

6,107

5,514

5,322

4,791


Total

1,577

1,586

1,597

1,563

YoY Growth Rate

11%

4%

11%

4%



2010~2012 figures account for UMC parent company only.


(1) One 6-inch wafer is converted into 0.5625(6 2 /8 2 ) 8-inch equivalent wafer; one 12-inch wafer is converted into 2.25(12 2 /8 2 ) 8-inch equivalent wafers. Capacity total figures are expressed in 8-inch equivalent wafers.

CAPEX for Foundry Segment

The foundry capital expenditure for 2014 will be US$1.3 billion . Spending during the first nine months of 2014 in the foundry segment was US$885 million .

Capital Expenditure by Year- in US$ billion

Year

2013

2012

2011

2010

2009

CAPEX

$1.10

$1.70

$1.60

$1.80

$0.55


2009~2012 figures account for UMC parent company only.

2014 CAPEX Plan

8"

12"

Total

12%

88%

US$ 1.3 billion

 

[4] Estimated capacity numbers are based on calculated maximum output rather than designed capacity . The actual capacity numbers may differ depending upon equipment delivery schedules, pace of migration to more advanced process technologies, and other factors affecting production ramp-up.

Fourth Quarter of 2014 Outlook & Guidance

Quarter-over-Quarter Guidance:

  • Foundry Segment Wafer Shipment: To decrease by approximately 3%
  • Foundry Segment ASP in US$: To increase by approximately 1%
  • Foundry Segment Profitability: Gross margin will be in the mid-20 percentage range
  • Foundry Segment Capacity Utilization: Approximately 90%
  • Expect to recognize approximately US$50mn from Fujitsu for 40nm licensing fee
  • Guidance to New Business Segment: Revenue to be approximately NT$2.5bn and net loss attributable to UMC parent company to be approximately NT$400mn

Recent Developments / Announcements

Please visit UMC's website for further details regarding the above announcements

Conference Call / Webcast Announcement

Wednesday, October 29, 2014

Time:   5:00 PM ( Taipei ) / 5:00 AM ( New York ) / 09:00 AM ( London )

Dial-in numbers and Access Codes:

USA Toll Free:     

1-800 871-3110, 1-888 700-7397

Taiwan Number:     

02-2192-8016

Other Areas:   

+886-2-2192-8016



Access Code: 

UMC

A live webcast and replay of the 3Q14 results announcement will be available at http://www.umc.com   under the "Investors / Events" section.

About UMC

UMC (NYSE: UMC, TWSE: 2303) is a leading global semiconductor foundry that provides advanced technology and manufacturing for applications spanning every major sector of the IC industry. UMC¡¦s robust foundry solutions allow chip designers to leverage the company¡¦s leading-edge processes, which include 28nm poly-SiON and gate-last High-K/Metal Gate technology, mixed signal/RFCMOS, and a wide range of specialty technologies. Production is supported through 10 wafer manufacturing facilities that include two advanced 300mm fabs; Fab 12A in Taiwan and Singapore -based Fab 12i. Fab 12A consists of Phases 1-4 which are in production for customer products down to 28nm. Construction has been completed for Phases 5&6, with future plans for Phases 7&8. The company employs over 15,000 people worldwide and has offices in Taiwan , mainland China , Europe , Japan , Korea, Singapore , and the United States . UMC can be found on the web at http://www.umc.com

Note from UMC Concerning Forward-Looking Statements

Some of the statements in the foregoing announcement are forward looking within the meaning of the U.S. Federal Securities laws, including statements about future outsourcing, wafer capacity, technologies, business relationships and market conditions. Investors are cautioned that actual events and results could differ materially from these statements as a result of a variety of factors, including conditions in the overall semiconductor market and economy; acceptance and demand for products from UMC; and technological and development risks. Further information regarding these and other risks is included in UMC¡¦s filings with the U.S. Securities and Exchange Commission, including its registration statements and reports on Forms F-1, F-3, F-6 and 20-F and 6-K, in each case as amended. UMC does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

Safe Harbor Statements

This release contains forward-looking statements.  These statements constitute "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995.  You can identify these forward-looking statements by use of words such as "strategy," "expects," "continues," "plans," "anticipates," "believes," "will," "estimates," "intends," "projects," "goals," "targets" and other words of similar meaning.  You can also identify them by the fact that they do not relate strictly to historical or current facts.

These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual performance, financial condition or results of operations of UMC to be materially different from what is stated or may be implied in such forward-looking statements.  Investors are cautioned that actual events and results could differ materially from those statements as a result of a number of factors including, but not limited to: (i) our dependence upon the frequent introduction of new services and technologies based on the latest developments in our industry; (ii) the intensely competitive semiconductor, communications, consumer electronics and computer industries and markets; (iii) the risks associated with international global business activities; (iv) our dependence upon key personnel; (v) general economic and political conditions; (vi) possible disruptions in commercial activities caused by natural and human-induced events and disasters, including terrorist activity, armed conflict and highly contagious diseases; (vii) reduced end-user purchases relative to expectations and orders; and (viii) fluctuations in foreign currency exchange rates.  Further information regarding these and other risks is included in UMC's  filings with the U.S. Securities and Exchange Commission, including its registration statements and reports on Form F-1, F-3, F-6 and 20-F and 6-K, in each case as amended. UMC does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

The financial statements included in this release are prepared and published in accordance with TIFRSs recognized by Financial Supervisory Commission in the ROC, which is different from IFRSs issued by the International Accounting Standards Board. Investors are cautioned that there may be significant differences between TIFRSs and IFRSs. In addition, TIFRSs and IFRSs differ in certain significant respects from ROC GAAP and US GAAP.

This presentation is not an offer of securities for sale in the United States . Securities may not be offered or sold in the United States absent registration or an exemption from registration. Any public offering of securities to be made in the United States will be made by means of a prospectus that may be obtained from the issuer or selling security holder and that will contain detailed information about the company and management, as well as financial statements.

- FINANCIAL TABLES TO FOLLOW -

  

                UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES   

   Consolidated Condensed Balance Sheet

As of   September 30, 2014

  Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)














September 30, 2014


US$


NT$


%

Assets






Current assets






  Cash and cash equivalents

1,406


42,744


14.2%

  Financial assets at fair value through profit or loss, current

21


649


0.2%

  Available-for-sale financial assets, current

72


2,190


0.7%

  Notes & Accounts receivable, net

721


21,932


7.3%

  Inventories, net

471


14,310


4.8%

  Other current assets

328


9,977


3.3%

    Total current assets

3,019


91,802


30.5%







Non-current assets






  Funds and investments

1,093


33,236


11.0%

  Property, plant and equipment

5,343


162,474


54.0%

  Other non-current assets

437


13,310


4.5%

    Total non-current assets

6,873


209,020


69.5%

Total assets

9,892


300,822


100.0%







Liabilities






Current liabilities






  Short-term loans

233


7,075


2.4%

  Financial liabilities at fair value through profit or loss, current

0


8


0.0%

  Payables

963


29,271


9.7%

  Current portion of long-term liabilities

269


8,188


2.7%

  Other current liabilities

29


902


0.3%

    Total current liabilities

1,494


45,444


15.1%







Non-current liabilities






  Bonds payable

821


24,977


8.3%

  Long-term loans

231


7,008


2.4%

  Other non-current liabilities

230


7,001


2.3%

    Total non-current liabilities

1,282


38,986


13.0%

    Total liabilities

2,776


84,430


28.1%







Equity






Equity attributable to the parent company






Capital

4,184


127,248


42.3%

Additional paid-in capital

1,296


39,418


13.1%

Retained earnings, unrealized gain or loss on available-for-sale
    financial assets and exchange differences on translation of
    foreign operations

1,587


48,244


16.0%

Treasury stock

(78)


(2,365)


(0.8%)

     Total equity attributable to the parent company

6,989


212,545


70.6%

Non-controlling interests

127


3,847


1.3%

     Total equity

7,116


216,392


71.9%

Total liabilities and equity

9,892


300,822


100.0%







Note: New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2014 exchange rate of NT
$30.41 per U.S. Dollar.

All figures are prepared in accordance with TIFRSs.

  

UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES

Consolidated Condensed Statements of Comprehensive Income

Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)

Except Per Share and Per ADS Data










































Year over Year Comparison


Quarter over Quarter Comparison


Three-Month Period Ended




Three-Month Period Ended




September 30, 2014


September 30, 2013


%


September 30, 2014


June 30, 2014


%


US$


NT$


US$


NT$


Chg.


US$


NT$


US$


NT$


Chg.

Net operating revenues

1,158


35,214


1,099


33,407


5.4%


1,158


35,214


1,180


35,869


(1.8%)

Operating costs

(909)


(27,655)


(858)


(26,070)


6.1%


(909)


(27,655)


(910)


(27,662)


(0.0%)

Gross profit

249


7,559


241


7,337


3.0%


249


7,559


270


8,207


(7.9%)


21.5%


21.5%


22.0%


22.0%




21.5%


21.5%


22.9%


22.9%



Operating expenses




















  - Sales and marketing expenses

(32)


(957)


(26)


(778)


23.0%


(32)


(957)


(36)


(1,097)


(12.8%)

  - General and administrative expenses

(28)


(845)


(28)


(854)


(1.1%)


(28)


(845)


(28)


(857)


(1.4%)

  - Research and development expenses

(114)


(3,468)


(107)


(3,262)


6.3%


(114)


(3,468)


(110)


(3,326)


4.3%

      Subtotal

(174)


(5,270)


(161)


(4,894)


7.7%


(174)


(5,270)


(174)


(5,280)


(0.2%)

Net other operating income and expenses

(20)


(602)


(1)


(48)


100.0%


(20)


(602)


(0)


(10)


100.0%

Operating income

55


1,687


79


2,395


(29.6%)


55


1,687


96


2,917


(42.2%)


4.8%


4.8%


7.2%


7.2%




4.8%


4.8%


8.1%


8.1%























Net non-operating income and expenses

43


1,305


51


1,561


(16.4%)


43


1,305


31


937


39.3%

Income from continuing operations before income tax

98


2,992


130


3,956


(24.4%)


98


2,992


127


3,854


(22.4%)


8.5%


8.5%


11.8%


11.8%




8.5%


8.5%


10.7%


10.7%























Income tax expense

(13)


(413)


(19)


(590)


(30.0%)


(13)


(413)


(18)


(528)


(21.8%)

Net income

85


2,579


111


3,366


(23.4%)


85


2,579


109


3,326


(22.5%)


7.3%


7.3%


10.1%


10.1%




7.3%


7.3%


9.3%


9.3%























Other comprehensive income (loss)

(50)


(1,501)


(74)


(2,249)


(33.3%)


(50)


(1,501)


4


103


-





















Total comprehensive income

35


1,078


37


1,117


(3.5%)


35


1,078


113


3,429


(68.6%)





















    Net income attributable to:




















Stockholders of the parent

96


2,916


114


3,476


(16.1%)


96


2,916


115


3,482


(16.3%)

Non-controlling interests

(11)


(337)


(3)


(110)


100.0%


(11)


(337)


(6)


(156)


100.0%





















    Comprehensive income attributable to:




















Stockholders of the parent

45


1,372


41


1,255


9.3%


45


1,372


120


3,636


(62.3%)

Non-controlling interests

(10)


(294)


(4)


(138)


100.0%


(10)


(294)


(7)


(207)


42.0%





















Earnings per share-basic

0.008


0.23


0.009


0.28




0.008


0.23


0.009


0.28



Earnings per ADS (2)

0.038


1.15


0.046


1.40




0.038


1.15


0.046


1.40



Weighted average number of shares




















outstanding (in millions)



12,501




12,460






12,501




12,489























Notes:




















(1) New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2014 exchange rate of NT $30.41 per U.S. Dollar.

All figures are prepared in accordance with TIFRSs.

(2) 1 ADS equals 5 common shares.

 

UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES

Consolidated Condensed Statements of Comprehensive Income

Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)

Except Per Share and Per ADS Data














For the Three-Month Period Ended


For the Nine-Month Period Ended


September 30, 2014


September 30, 2014


US$


NT$


%


US$


 NT$ 


%

Net operating revenues                                   

1,158


35,214


100.0%


3,380


102,777


100.0%

Operating costs

(909)


(27,655)


(78.5%)


(2,668)


(81,110)


(78.9%)

Gross profit

249


7,559


21.5%


712


21,667


21.1%

























Operating expenses












  - Sales and marketing expenses

(32)


(957)


(2.7%)


(95)


(2,888)


(2.8%)

  - General and administrative expenses

(28)


(845)


(2.4%)


(84)


(2,549)


(2.5%)

  - Research and development expenses

(114)


(3,468)


(9.9%)


(333)


(10,129)


(9.9%)

      Subtotal

(174)


(5,270)


(15.0%)


(512)


(15,566)


(15.2%)

Net other operating income and expenses

(20)


(602)


(1.7%)


(18)


(557)


(0.5%)

Operating income

55


1,687


4.8%


182


5,544


5.4%













Net non-operating income and expenses

43


1,305


3.7%


86


2,594


2.5%

Income from continuing operations before income tax

98


2,992


8.5%


268


8,138


7.9%

























Income tax expense

(13)


(413)


(1.2%)


(37)


(1,122)


(1.1%)

Net income 

85


2,579


7.3%


231


7,016


6.8%













Other comprehensive income (loss)

(50)


(1,501)


(4.2%)


90


2,731


2.7%













Total comprehensive income

35


1,078


3.1%


321


9,747


9.5%













    Net income attributable to:












Stockholders of the parent

96


2,916


8.3%


249


7,578


7.4%

Non-controlling interests

(11)


(337)


(1.0%)


(18)


(562)


(0.6%)













    Comprehensive income attributable to:












Stockholders of the parent

45


1,372


3.9%


338


10,269


10.0%

Non-controlling interests

(10)


(294)


(0.8%)


(17)


(522)


(0.5%)













Earnings per share-basic

0.008


0.23




0.020


0.61



Earnings per ADS (2)

0.038


1.15




0.100


3.05















Weighted average number of shares
     outstanding (in millions)



12,501






12,490















Notes:












(1) New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2014 exchange rate of NT $30.41 per U.S. Dollar.

All figures are prepared in accordance with TIFRSs.

(2) 1 ADS equals 5 common shares.

 

UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES

Consolidated Condensed Statement of Cash Flows

For The Nine-Month Period Ended September 30, 2014

 Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)







USD


NTD


Cash flows from operating activities :





    Net income before tax

268


8,138


    Depreciation & Amortization

986


29,994


    Impairment loss on financial assets

8


257


    Impairment loss on non-financial assets

20


597


    Gain on disposal of investments

(57)


(1,739)


    Changes in notes & accounts receivable

(167)


(5,084)


    Changes in other current assets

(158)


(4,796)


    Changes in assets, liabilities and others

(47)


(1,415)


Net cash provided by operating activities

853


25,952







Cash flows from investing activities :





    Acquisition of available-for-sales financial assets

(5)


(167)


    Proceeds from disposal of available-for-sale financial assets

72


2,199


    Acquisition of financial assets measured at cost

(24)


(747)


    Proceeds from sale of financial assets measured at cost

22


674


    Acquisition ofinvestments accounted for under the equity method

(4)


(121)


    Acquisition of property, plant and equipment

(889)


(27,029)


    Proceeds from disposal of property, plant and equipment 

8


253


    Acquisition of intangible assets

(29)


(871)


    Others

(0)


(7)


Net cash used in investing activities

(849)


(25,816)







Cash flows from financing activities :





    Increase in short-term loans

78


2,364


    Proceeds from bonds issued

164


5,000


    Redemption of bonds

(339)


(10,306)


    Proceeds from long-term loans

60


1,824


    Repayments of long-term loans

(57)


(1,735)


    Cash dividends and cash paid from additional paid-in capital

(206)


(6,253)


    Others

14


419


Net cash used in financing activities

(286)


(8,687)







Effect of exchange rate changes on cash and cash equivalents

16


464


Net decrease in cash and cash equivalents

(266)


(8,087)







Cash and cash equivalents at beginning of period

1,672


50,831







Cash and cash equivalents at end of period

1,406


42,744












Note: New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2014 exchange rate of NT $30.41 per U.S. Dollar.

All figures are prepared in accordance with TIFRSs.



Contacts:

Bowen Huang / David Wong
UMC, Investor Relations
+886-2-2658-9168, ext. 16900
Email Contact / Email Contact

SOURCE United Microelectronics Corporation

Contact:
United Microelectronics Corporation
Web: http://www.umc.com/english/investors/3Q14_ASP_trend.asp



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