UMC Reports Second Quarter 2017 Results

Company recognizes revenue contribution from 14nm shipments in 2Q17

Second Quarter 2017 Overview1:

  • Revenue: NT$37.54 billion (US$1.23 billion)
  • Gross margin: 18.0%
  • Foundry revenue from 28nm: 17%; Foundry operating margin: 4.7%
  • Foundry capacity utilization rate: 96%
  • Net income attributable to the stockholders of the parent: NT$2.10 billion (US$69.00 million)
  • Earnings per share: NT$0.17; earnings per ADS: US$0.028

TAIPEI, Taiwan — (BUSINESS WIRE) — July 26, 2017United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) (“UMC” or “The Company”), a leading global semiconductor foundry, today announced its consolidated operating results for the second quarter of 2017.

Second quarter consolidated revenue was NT$37.54 billion, up from NT$37.42 billion in 1Q17 and up 1.5% YoY from NT$37.00 billion in 2Q16. 2Q17 consolidated gross margin was 18.0%. Net income attributable to the stockholders of the parent was NT$2.10 billion, with earnings per ordinary share of NT$0.17.

Jason Wang, newly appointed co-president of UMC, said, “In the second quarter of 2017, UMC’s foundry revenue was NT$37.45 billion. Stable chip demand led to a utilization rate of 96%, bringing wafer shipments to 1.74 million 8-inch equivalents. Gross margin was 18.1%. We experienced robust demand for our mature technologies on both 8” and 12” manufacturing, led by strength in the computing and communication segments.”

President Wang continued, “Looking into the third quarter, demand for our mature technologies remains firm. However, due to a softened outlook for 28nm, we project a sequentially flat quarter. Our 28nm HKMG business has become increasingly vulnerable due to high exposure among a few key customers. As a result, we are seeing the possibility that the decline of our 28nm HKMG business will extend into the second half of 2017.”

Co-president SC Chien added, “Recently, UMC’s board of directors appointed Mr. Jason Wang and I as co-presidents. I will take the lead in fab operations and technology development, while president Wang will be responsible for business management and corporate strategy. We will both implement measures to strengthen our foundry competitiveness in core manufacturing and drive operational efficiencies to enhance financial performance. Our goal is to unlock UMC’s value and lead to positive cash flow.”

Summary of Operating Results

Operating Results
(Amount: NT$ million)     2Q17   1Q17   QoQ %
change
  2Q16   YoY %
change
Net Operating Revenues     37,538   37,418   0.3   36,997   1.5
Gross Profit 6,739 7,428 (9.3 ) 8,285 (18.7 )
Operating Expenses (5,330 ) (6,211 ) (14.2 ) (5,859 ) (9.0 )
Net Other Operating Income and Expenses 259 154 68.2 23 1,026.1
Operating Income (Loss) 1,668 1,371 21.7 2,449 (31.9 )
Net Non-Operating Income and Expenses 448 (304 ) - (650 ) -
Net Income Attributable to Stockholders of the Parent 2,099 2,286 (8.2 ) 2,583 (18.7 )

EPS (NT$ per share)

0.17 0.19 0.21

(US$ per ADS)

    0.028     0.031         0.035      

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