UMC Reports Fourth Quarter 2014 Results

Full-year 2014 foundry revenue up 10%, operating profit increased 74% YoY

(PRNewswire) —

Fourth Quarter 2014 Overview[1]:

  • Revenue: NT$37.24 billion (US$1.18 billion)
  • Gross margin: 27.4%; operating margin: 12.2%
  • Foundry revenue from advanced nodes: 7% from 28nm, 21% from 40nm
  • Foundry capacity utilization rate: 93%
  • Net income attributable to the stockholders of the parent: NT$4.56 billion (US$144 million)
  • Earnings per share: NT$0.36; earnings per ADS: US$0.057

United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) ("UMC" or "The Company"), a leading global semiconductor foundry, today announced its consolidated operating results for the fourth quarter of 2014.

Fourth quarter consolidated revenue was NT$37.24 billion, a 5.7% quarterly increase from NT$35.21 billion in 3Q14 and a 21.2% annual increase from NT$30.72 billion in 4Q13. 4Q14 consolidated gross margin was 27.4%, with operating margin at 12.2%. Net income attributable to the stockholders of the parent was NT$4.56 billion, with earnings per ordinary share of NT$0.36. For 2014, full year revenue was NT$140.01 billion, with NT$10.08 billion in operating income, NT$12.14 billion net income attributable to the stockholders of the parent and NT$0.97 earnings per share.

Mr. Po-Wen Yen, CEO of UMC, said, "In the fourth quarter, foundry revenue grew 3.7% sequentially to NT$34.74 billion. This figure includes a one-time 40nm licensing fee from Fujitsu, lifting gross and operating margins to 30.2% and 14.6%, respectively. Overall capacity utilization rate remained at 93%, bringing shipments to 1.43 million 8-inch equivalent wafers. Our 28nm technologies represented 7% of our foundry revenue in 4Q14. Shipments from our 28nm gate-last, High-K Metal Gate process exceeded that of 28nm poly-SiON wafers. Excluding the Fujitsu 40nm licensing fee, UMC's 2014 foundry operating profit grew 74% from the previous year. This rise in profitability was mainly driven by double-digit percentage growth in wafer shipments and partly due to the rapid production ramp of 28nm, which accounted for 3% of total 2014 revenue. Our collaborative technology efforts with our partners will enable UMC to deliver additional manufacturing solutions to fulfill new product specs, strengthening our position in the IC supply chain to take advantage of the continued momentum in market demand."

CEO Yen continued, "The Taiwan government authorities recently approved UMC's application to invest in a 12" joint venture fab in Xiamen, China. This investment will create opportunities for UMC to benefit from China's enormous chip requirements by bringing us closer to the Chinese semiconductor supply chain. The cooperation highlights UMC's differentiated approach of global expansion, proven through Singapore's Fab12i and SuZhou's Fab8N successfully achieving economy of scale while mitigating customer risks via geographic diversification. While we expand production sites worldwide, we are also focusing on continuous organic growth by deploying additional capacity at our Tainan site. As such, we will budget 2015 CAPEX for approximately US$1.8 billion. Our 2015 CAPEX illustrates our strong commitment to meet customers' requirements and gain additional market share through efficient execution and strategic alliances. UMC's global expansion efforts, driven by manufacturing excellence, will strengthen customer services with increased operating scale to enhance corporate financial earnings and deliver long-term returns to our shareholders."

Summary of Operating Results

Operating Results

(Amount: NT$ million)

  4Q14

  3Q14

QoQ %
change

 4Q13

YoY %
change

Net Operating Revenues

37,235

35,214

5.7

30,719

21.2

Gross Profit

10,186

7,559

34.8

5,557

83.3

Operating Expenses

(5,672)

(5,270)

7.6

(5,317)

6.7

Net Other Operating Income and Expenses

18

(602)

-

(46)

-

Operating Income

4,532

1,687

168.6

194

2,236.1

Net Non-Operating Income and Expenses

843

1,305

(35.4)

889

(5.2)

Net Income Attributable to the Stockholders of the Parent

4,563

2,916

56.5

749

509.2

EPS   (NT$ per share)

0.36

0.23


0.06


         (US$ per ADS)

0.057

0.036


0.009



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