UMC Reports Third Quarter 2019 Results

UMC fully acquires USJC, which will enhance company’s market share by 10%
3Q19 EPS jumps 67% QoQ to NT$0.25 per share  Third Quarter 2019 Overview1:

  • Revenue: NT$37.74 billion (US$1.22 billion)
  • Gross margin: 17.1%
  • Foundry revenue from 28nm: 12%; Foundry operating margin: 6.9%
  • Foundry capacity utilization rate: 91%
  • Net income attributable to stockholders of the parent: NT$2.93 billion (US$94 million)
  • Earnings per share: NT$0.25; earnings per ADS: US$0.040

TAIPEI, Taiwan — (BUSINESS WIRE) — October 30, 2019United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) (“UMC” or “The Company”), a leading global semiconductor foundry, today announced its consolidated operating results for the third quarter of 2019.

Third quarter consolidated revenue was NT$37.74 billion, up 4.7% QoQ from NT$36.03 billion in 2Q19 and down 4.2% YoY from NT$39.39 billion in 3Q18. Consolidated gross margin for 3Q19 was 17.1%. Net income attributable to stockholders of the parent was NT$2.93 billion, with earnings per ordinary share of NT$0.25.

Jason Wang, co-president of UMC, said, “In the third quarter, foundry revenue grew 4.8% QoQ to NT$37.73 billion, leading to a foundry operating margin of 6.9%. Utilization rate increased to 91%, bringing wafer shipments to 1.81 million 8-inch equivalent wafers. The increase in wafer demand was primarily driven by inventory restocking in the wireless communication markets, which included products such as WiFi, RF switch and power management ICs. On October 1st, UMC also completed the full acquisition of MIFS, a 300mm fab based in Japan that is currently manufacturing 90nm, 65nm and 40nm products. The fab, which fits our specialty technology focus and long term growth projections, has been renamed United Semiconductor Japan Co., Ltd. (USJC). USJC will increase our foundry market share, provide business synergies and benefit from economies of scale while broadening UMC’s comprehensive specialty and logic technologies to serve Japanese and international customers.”

Co-president Wang further commented, “Looking to the fourth quarter, based on customers’ forecasts, the overall business outlook appears to remain firm primarily due to sustained wafer demand from new product deployment across communications and computing market segments. These product rollouts include RF ICs and OLED driver ICs found in 5G smartphones and power management ICs designed into computing and solid-state drive applications. We expect these product releases to enable UMC to further gain market share in 5G wireless devices as well as in non-volatile memory applications. We will continue to pursue our corporate strategy of focusing on business expansion in mature specialty and logic technologies while delivering world-class service to our customers. With UMC’s economy of scale and our core strength in foundry technologies, we look forward to securing new business opportunities by delivering a variety of differentiated manufacturing solutions in the semiconductor industry.”

Summary of Operating Results

Operating Results

(Amount: NT$ million)

3Q19

2Q19

QoQ %
change

3Q18

YoY %
change

Operating Revenues

37,738

36,031

4.7

39,387

(4.2)

Gross Profit

6,433

5,652

13.8

6,922

(7.1)

Operating Expenses

(5,131)

(5,578)

(8.0)

(5,702)

(10.0)

Net Other Operating Income and Expenses

1,207

1,687

(28.4)

1,215

(0.6)

Operating Income

2,509

1,761

42.5

2,435

3.0

Net Non-Operating Income and Expenses

(532)

(617)

(13.9)

(1,606)

(66.9)

Net Income Attributable to Stockholders of the Parent

2,929

1,740

68.3

1,720

70.2

EPS (NT$ per share)

0.25

0.15

 

0.14

 

(US$ per ADS)

0.040

0.024

 

0.023

 


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