Zeev's Turnips Patch-No Politics (ZEEV)

[AKvetch]

Cholan, TSM was not the "last nail", as you put it. UMC is also cutting back on capital equipment purchases. AK
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UMC trims capital spend despite good times' return
By Semiconductor Business News
Jul 30, 2002 (2:30 AM)

URL: http://www.siliconstrategies.com/story/OEG20020730S0001

TAIPEI, Taiwan -- Foundry manufacturer United Microelectronics Corp. (UMC) grew its sales revenue and net profits in the second quarter of 2002 but the company still took the opportunity to announce a trimming of its plans for 2002 capital expenditure from US$1.6 billion forecast in the first quarter to $1.3 billion.

UMC's sales revenue for the second quarter was $554 million up 52.8% from the first quarter of 2002 and up 23.9% from the $362 million of the same quarter in the previous year. UMC made a net profit of $133 million in the second quarter of 2002. This compared with $6 million profit in the previous quarter and a loss of $55 million in the second quarter of 2001.

“We are extremely pleased with our results for the quarter, especially the significant quarter-over-quarter growth in sales that topped our forecast. Clearly, even more important is our return to operating profitability,” said UMC vice chairman and chief executive officer John Hsuan, in a statement.

Hsaun put the booming second quarter sales down to strong demand from the consumer and communications sectors and the fact that the adoption of more advanced technology was having a beneficial effect on average selling prices.

However, UMC still sees only gradual recovery in place, indeed more gradual than previously expected, and so it plans for a cut in 2002 capital expenditure.

The company said that within the revised plan it remains committed to spend in full the amounts originally budgeted for Fab12A capacity expansion and 130-nanometer copper modules. On the other hand, UMC will reduce the amount allocated to increase eight-inch wafer capacity for Fab 8F.

Capacity for the second quarter was 649,000 eight-inch equivalent wafers. UMC currently estimates that in the third quarter of 2002 capacity will reduce to 641,000 eight-inch equivalent wafers, mainly due to a capacity adjustment across fabs. Fab 8C, Fab 8D and Fab 8E equipment will be reshuffled to optimize each fab's productivity, and Fab 8D will be transformed into a full copper production line.

Copyright 2001 © CMP Media Inc.