Semiconductor Manufacturing International Corp. (SMI)

[*MARINE 1*]

* Q4 sales seen down 25-29 percent vs Q3

* Q4 utilization rate seen falling to 60-80 pct

BEIJING, Oct 30 (Reuters) - Semiconductor Manufacturing International Corp (SMI.N: Quote, Profile, Research, Stock Buzz) (0981.HK: Quote, Profile, Research, Stock Buzz), China's top contract chip maker, said on Thursday fourth-quarter revenues and utilisation rates would fall sharply from the previous quarter.

SMIC, which lags sector leaders TSMC (2330.TW: Quote, Profile, Research, Stock Buzz) (TSM.N: Quote, Profile, Research, Stock Buzz) and UMC (2303.TW: Quote, Profile, Research, Stock Buzz) in the made-to-order microchip market, had earlier posted a smaller-than-forecast third-quarter net loss, but said the fourth quarter would be worse. [ID:nHKG72054]

Chief Executive Richard Chang told a conference call that fourth-quarter revenue was likely to drop 25-29 percent from the third quarter. "So far, we still see some last-minute orders to come in for the fourth quarter ... (but) we'd like to play conservatively," he said.

Capacity utilisation is expected to fall to 60-80 percent in the fourth quarter, Chang said. Utilisation, a key indicator for the wafer manufacturer, edged down to 90.5 percent in the third quarter from 94.1 percent a year earlier.

The global tech industry is facing a slowing economy that is taking a toll on consumer spending on computers, cellphones and flat-screen TVs, all products that use microchips.

Chang said revenues in the 2009 first quarter would be flat from the current fourth quarter.

Shanghai-based SMIC posted a $30.3 million loss for the third quarter and said it would hold back on capacity expansion for now until the visibility of end-customer demand becomes clearer.

Taiwan's UMC, the world's No.2 contract chip maker, on Wednesday posted its first quarterly net loss in seven years as it booked investment losses and slower demand hurt chip sales and prices.

TSMC is due to report its quarterly earnings later on Thursday. (Reporting by Michael Wei; editing by Ian Geoghegan)