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UMC Reports Third Quarter 2019 Results

TAIPEI, Taiwan--(BUSINESS WIRE)--

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

United 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

 

Operating revenues in 3Q19 grew 4.7% to NT$37.74 billion, including NT$37.73 billion from the foundry segment. Revenue contribution from 40nm and below technologies slightly increased to 38%. Gross profit increased 13.8% quarterly to NT$6.4 billion, or 17.1% of revenue. Operating expenses declined 8.0% to NT$5.13 billion. Net other operating income declined to NT$1.21 billion, leading to an operating income of NT$2.51 billion. Net non-operating expense was NT$532 million. Net income attributable to stockholders of the parent was NT$2.93 billion.

Earnings per ordinary share for the quarter was NT$0.25. Earnings per ADS was US$0.040. The basic weighted average number of outstanding shares in 3Q19 was 11,708,239,978, compared with 11,817,657,562 shares in 2Q19 and 12,053,892,152 shares in 3Q18. The diluted weighted average number of outstanding shares was 13,049,025,428 in 3Q19, compared with 13,079,662,179 shares in 2Q19 and 13,354,955,886 shares in 3Q18. The fully diluted share count on September 30, 2019 was approximately 13,065,104,000.

Detailed Financials Section

COGS & Expenses

(Amount: NT$ million)

3Q19

2Q19

QoQ %
change

3Q18

YoY %
change

Operating Revenues

37,738

36,031

4.7

39,387

(4.2)

COGS

(31,305)

(30,379)

3.1

(32,465)

(3.6)

Depreciation

(10,707)

(11,424)

(6.3)

(11,549)

(7.3)

Other Mfg. Costs

(20,598)

(18,955)

8.7

(20,916)

(1.5)

Gross Profit

6,433

5,652

13.8

6,922

(7.1)

Gross Margin (%)

17.1%

15.7%

 

17.6%

 

Operating Expenses

(5,131)

(5,578)

(8.0)

(5,702)

(10.0)

G&A

(1,344)

(1,251)

7.5

(1,386)

(2.9)

Sales & Marketing

(970)

(953)

1.8

(987)

(1.8)

R&D

(2,813)

(2,787)

0.9

(3,329)

(15.5)

Expected Credit Losses

(4)

(587)

(99.4)

-

100.0

Net Other Operating

Income & Expenses

1,207

1,687

(28.4)

1,215

(0.6)

Operating Income

2,509

1,761

42.5

2,435

3.0

Operating revenues grew 4.7% to NT$37.74 billion. COGS increased 3.1% to NT$31.31 billion, as depreciation declined 6.3% to NT$10.71 billion while other manufacturing costs increased 8.7% to NT$20.60 billion primarily due to higher wafer shipments. Gross profit grew 13.8% to NT$6.43 billion. Operating expenses declined 8.0% to NT$5.13 billion. R&D expense represented 7.5% of 3Q19 operating revenues and net other operating income was NT$1.21 billion. In 3Q19, the company realized an operating income of NT$2.51 billion.

Non-Operating Income and Expenses

(Amount: NT$ million)

3Q19

2Q19

3Q18

Non-Operating Income and Expenses

(532)

(617)

(1,606)

Net Interest Income and Expenses

(503)

(497)

(507)

Net Investment Gain and Loss

736

69

(126)

Exchange Gain and Loss

(752)

(182)

(961)

Other Gain and Loss

(13)

(7)

(12)

Net non-operating expense in 3Q19 was NT$532 million, mainly resulting from NT$752 million in exchange loss and NT$503 million in net interest expense, partly offset by NT$736 million in net investment gain.

Cash Flow Summary

(Amount: NT$ million)

For the 3-Month
Period Ended

Sep. 30, 2019

For the 3-Month
Period Ended

Jun. 30, 2019

Cash Flow from Operating Activities

(3,080)

12,268

Net income before tax

1,977

1,144

Depreciation & Amortization

12,050

12,185

Expected credit losses

4

587

Share of profit of associates and

joint ventures

(109)

(201)

Income tax paid

(99)

(135)

Changes in working capital & others

(16,903)

(1,312)

Cash Flow from Investing Activities

(3,968)

(4,188)

Acquisition of PP&E

(3,550)

(3,904)

Acquisition of intangible assets

(732)

(247)

Others

314

(37)

Cash Flow from Financing Activities

4,137

(6,467)

Bank loans

11,168

(1,197)

Redemption of bonds

-

(2,500)

Treasury stock acquired

-

(2,641)

Cash dividends

(6,914)

-

Others

(117)

(129)

Effect of Exchange Rate

(692)

10

Net Cash Flow

(3,603)

1,623

Beginning balance

90,356

88,738

Changes in non-current assets held for sale

2

(5)

Ending balance

86,755

90,356

In 3Q19, the company set aside an amount of JPY 54.4 billion as other current assets in order to complete the acquisition of USJC. As a result, cash outflow from operating activities was NT$3.08 billion. Free cash outflow was NT$7.27 billion due to the PP&E spending of NT$3.55 billion and NT$732 million in the acquisition of intangible assets. Cash inflow from financing activities totaled NT$4.14 billion, primarily from NT$11.17 billion in bank loans, partly offset by NT$6.91 billion in the payment of cash dividends. Net cash outflow in 3Q19 was NT$3.60 billion. Over the next 12 months, the company expects to repay NT$3.13 billion in bank loans.

Current Assets

(Amount: NT$ billion)

3Q19

2Q19

3Q18

Cash and Cash Equivalents

86.76

90.36

81.52

Notes & Accounts Receivable

23.41

24.39

25.61

Days Sales Outstanding

58

60

61

Inventories, net

19.99

19.63

17.59

Days of Inventory

58

58

50

Total Current Assets

163.49

150.51

140.15

Cash and cash equivalents decreased to NT$86.76 billion. Days of inventory remained at 58 days.

Liabilities

(Amount: NT$ billion)

3Q19

2Q19

3Q18

Total Current Liabilities

70.33

77.06

51.43

Notes & Accounts Payable

6.63

6.91

6.89

Short-Term Credit / Bonds

40.08

39.43

20.33

Payable on Equipment

3.00

2.60

2.59

Dividends Payable

-

6.92

-

Other

20.62

21.20

21.62

Long-Term Credit / Bonds

55.23

45.39

67.46

Long-Term Investment Liabilities

20.17

20.83

20.16

Total Liabilities

169.00

167.84

160.11

Debt to Equity

82%

83%

75%

Current liabilities decreased to NT$70.33 billion. Total liabilities increased to NT$169.00 billion, leading to a debt to equity ratio of 82%.

Analysis of Revenue2 for Foundry Segment

Revenue Breakdown by Region

Region

3Q19

2Q19

1Q19

4Q18

3Q18

North America

33%

31%

32%

38%

34%

Asia Pacific

59%

59%

57%

51%

52%

Europe

6%

7%

7%

8%

11%

Japan

2%

3%

4%

3%

3%

Revenue from Asia Pacific remained at 59%, while revenue contribution from North American customers climbed to 33%. Revenue from Europe and Japan was 6% and 2%, respectively.

Revenue Breakdown by Geometry

Geometry

3Q19

2Q19

1Q19

4Q18

3Q18

14nm and below

0%

0%

0%

1%

5%

14nm<x<=28nm

12%

13%

10%

10%

13%

28nm<x<=40nm

26%

24%

20%

23%

22%

40nm<x<=65nm

14%

14%

14%

13%

12%

65nm<x<=90nm

12%

12%

12%

11%

10%

90nm<x<=0.13um

11%

14%

15%

13%

11%

0.13um<x<=0.18um

13%

12%

15%

15%

14%

0.18um<x<=0.35um

9%

8%

11%

11%

10%

0.5um and above

3%

3%

3%

3%

3%

Revenue contribution from 28nm was 12% while 40nm business represented 26% of sales.

Revenue Breakdown by Customer Type

Customer Type

3Q19

2Q19

1Q19

4Q18

3Q18

Fabless

92%

93%

94%

92%

93%

IDM

8%

7%

6%

8%

7%

Revenue from fabless customers decreased to 92% of revenue.

Revenue Breakdown by Application (1)

Application

3Q19

2Q19

1Q19

4Q18

3Q18

Computer

13%

14%

15%

15%

19%

Communication

54%

52%

48%

44%

43%

Consumer

26%

28%

29%

30%

28%

Others

7%

6%

8%

11%

10%

The communication segment grew to 54% of revenue, while revenue from consumer applications declined to 26%. Computer related applications represented 13% of revenue.

(1) Computer consists of ICs such as CPU, GPU, HDD controllers, DVD/CD-RW control ICs, PC chipset, audio codec, keyboard controller, monitor scaler, USB, I/O chipset. Communication consists of handset components, broadband, WLAN, bluetooth, Ethernet, LAN, DSP, etc. Consumer consists of ICs used for DVD players, DTV, STB, MP3/MP4, flash controller, game consoles, DSC, smart cards, toys, etc.

Blended ASP Trend for Foundry Segment

Blended average selling price (ASP) in 3Q19 slightly increased.

(To view ASP trend, visit http://www.umc.com/english/investors/3Q19_ASP_trend.asp)

Shipment and Utilization Rate3 for Foundry Segment

Wafer Shipments

 

3Q19

2Q19

1Q19

4Q18

3Q18

Wafer Shipments
(8” K equivalents)

1,806

1,730

1,611

1,711

1,804

 

Quarterly Capacity Utilization Rate

 

3Q19

2Q19

1Q19

4Q18

3Q18

Utilization Rate

91%

88%

83%

88%

94%

Total Capacity
(8” K equivalents)

2,004

1,970

1,937

1,958

1,938

In 3Q19, wafer shipments grew 4.4% to 1,806K. Quarterly capacity increased 1.7% QoQ to 2,004K, resulting in an overall utilization rate of 91%.

Capacity4 for Foundry Segment

Total capacity in the third quarter reached 2,004K 8-inch equivalent wafers. We foresee that fourth quarter capacity will grow to 2,237K 8-inch equivalent wafers, representing a sequential increase of 11.6% mainly due to the acquisition of USJC (Fab 12M) and the continuous capacity expansion at Fab 8N.

Annual Capacity in

thousands of wafers

 

Quarterly Capacity in

thousands of wafers

FAB

Geometry
(um)

2018

2017

2016

2015

 

FAB

4Q19E

3Q19

2Q19

1Q19

WTK

6"

3.5 – 0.45

396

422

423

421

 

WTK

93

93

93

91

Fab 8A

8"

0.5 – 0.25

825

825

827

813

 

Fab 8A

207

207

207

204

Fab 8C

8"

0.35 – 0.11

383

357

348

347

 

Fab 8C

111

111

109

106

Fab 8D

8"

0.13 – 0.09

347

341

342

341

 

Fab 8D

90

90

90

89

Fab 8E

8"

0.5 – 0.18

418

418

419

418

 

Fab 8E

111

107

105

103

Fab 8F

8"

0.18 – 0.11

431

417

401

388

 

Fab 8F

110

110

108

107

Fab 8S

8"

0.18 – 0.11

372

347

336

335

 

Fab 8S

93

93

93

92

Fab 8N

8"

0.5 – 0.11

771

753

750

667

 

Fab 8N

218

208

205

201

Fab 12A

12"

0.13 – 0.014

997

970

885

793

 

Fab 12A

250

250

250

246

Fab 12i

12"

0.13 – 0.040

555

537

584

572

 

Fab 12i

155

155

144

141

Fab 12X

12"

0.040 – 0.028

183

97

9

-

 

Fab 12X

51

51

51

50

Total(1)

7,673

7,304

6,983

6,617

 

Fab 12M

98

-

-

-

YoY Growth Rate

5%

5%

6%

5%

 

Total

2,237

2,004

1,970

1,937

(1) One 6-inch wafer is converted into 0.5625 (62/82) 8-inch equivalent wafer; one 12-inch wafer is converted into 2.25 (122/82) 8-inch equivalent wafers. Capacity total figures are expressed in 8-inch equivalent wafers.

CAPEX for Foundry Segment

Capital Expenditure by Year - in US$ billion

Year

2018

  2017

2016

2015

2014

CAPEX

$ 0.7

$ 1.4

$ 2.8

$ 1.9

$ 1.4

2019 CAPEX Plan

8"

12"

Total

25%

75%

US$700 million

CAPEX spending in 3Q19 was US$134 million, leading to US$452 million in capital expenditure for the first three quarters of 2019. Full year 2019 CAPEX budget will be revised to US$700 million.

Fourth Quarter of 2019 Outlook & Guidance

Quarter-over-Quarter Guidance:

  • Wafer Shipments: To increase by 10%
  • ASP in USD: To remain flat
  • Profitability: Gross profit margin will be in the mid-teens % range
  • Foundry Segment Capacity Utilization: Close to 90%
  • 2019 CAPEX for Foundry Segment: US$700 million

Recent Developments / Announcements

Please visit UMC’s website for further details regarding the above announcements

Conference Call / Webcast Announcement

Wednesday, October 30, 2019

Time: 5:00 PM (Taipei) / 5:00 AM (New York) / 09:00 AM (London)

Dial-in numbers and Access Codes:
USA Toll Free: 1-866 836-0101
Taiwan Number: 02-2192-8016
Other Areas: +886-2-2192-8016

Access Code: UMC

A live webcast and replay of the 3Q19 results announcement will be available at

www.umc.com under the “Investors / Events” section.

About UMC

UMC (NYSE: UMC, TWSE: 2303) is a leading global semiconductor foundry. The company provides mature and advanced IC production with a focus on Specialty Technologies to serve applications spanning every major sector of the electronics industry. UMC’s comprehensive foundry solutions enable chip designers to leverage the company’s sophisticated technology and manufacturing, which include high volume 28nm High-K/Metal Gate technology, volume production 14nm FinFET, specialty process platforms specifically developed for AI, 5G and IoT applications and the automotive industry’s highest-rated AEC-Q100 Grade-0 manufacturing capabilities for the production of ICs found in vehicles. UMC’s 12 wafer fabs are strategically located throughout Asia and are able to produce more than 700,000 wafers per month. The company employs approximately 19,500 people worldwide, with offices in Taiwan, China, Europe, Japan, Korea, Singapore, and the United States. UMC can be found on the web at http://www.umc.com.

Note from UMC Concerning Forward-Looking Statements

Some of the statements in the foregoing announcement are forward-looking within the meaning of the U.S. Federal Securities laws, including statements about introduction of new services and technologies, future outsourcing, competition, wafer capacity, business relationships and market conditions. Investors are cautioned that actual events and results could differ materially from these statements as a result of a variety of factors, including conditions in the overall semiconductor market and economy; acceptance and demand for products from UMC; and technological and development risks. Further information regarding these and other risks is included in UMC’s filings with the U.S. Securities and Exchange Commission. UMC does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

Safe Harbor Statements

This release contains forward-looking statements. These statements constitute “forward-looking” statements within the meaning of Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended, and as defined in the United States Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by use of words such as “strategy,” “expects,” “continues,” “plans,” “anticipates,” “believes,” “will,” “estimates,” “intends,” “projects,” “goals,” “targets” and other words of similar meaning. You can also identify them by the fact that they do not relate strictly to historical or current facts.

These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual performance, financial condition or results of operations of UMC to be materially different from what is stated or may be implied in such forward-looking statements. Investors are cautioned that actual events and results could differ materially from those statements as a result of a number of factors including, but not limited to: (i) dependence upon the frequent introduction of new services and technologies based on the latest developments in the industry in which UMC operates; (ii) the intensely competitive semiconductor, communications, consumer electronics and computer industries and markets; (iii) the risks associated with international business activities; (iv) dependence upon key personnel; (v) general economic and political conditions; (vi) possible disruptions in commercial activities caused by natural and human-induced events and disasters, including natural disasters, terrorist activity, armed conflict and highly contagious diseases; (vii) reduced end-user purchases relative to expectations and orders; and (viii) fluctuations in foreign currency exchange rates. Further information regarding these and other risks is included in UMC’s filings with the United States Securities and Exchange Commission. All information provided in this release is as of the date of this release and are based on assumptions that UMC believes to be reasonable as of this date, and UMC does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

The financial statements included in this release are prepared and published in accordance with Taiwan International Financial Reporting Standards, or TIFRSs, recognized by the Financial Supervisory Commission in the ROC, which is different from International Financial Reporting Standards, or IFRSs, issued by the International Accounting Standards Board. Investors are cautioned that there may be significant differences between TIFRSs and IFRSs. In addition, TIFRSs and IFRSs differ in certain significant respects from generally accepted accounting principles in the ROC and generally accepted accounting principles in the United States.

This release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. Any public offering of securities to be made in the United States will be made by means of a prospectus that may be obtained from the issuer or selling security holder and that will contain detailed information about the company and management, as well as financial statements.

- FINANCIAL TABLES TO FOLLOW -

UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES 

  Consolidated Condensed Balance Sheet

As of September 30, 2019

 Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)

 
 September 30, 2019
US$ NT$ %
Assets
Current assets
 Cash and cash equivalents

2,797

86,755

23.2%

 Notes & Accounts receivable, net

755

23,412

6.3%

 Inventories, net

644

19,990

5.3%

 Other current assets

1,074

33,333

8.9%

    Total current assets

5,270

163,490

43.7%

 
Non-current assets      
 Funds and investments

1,301

40,361

10.8%

 Property, plant and equipment

4,802

148,946

39.8%

 Right-of-use assets

260

8,074

2.2%

 Other non-current assets

425

13,173

3.5%

    Total non-current assets

6,788

210,554

56.3%

Total assets

12,058

374,044

100.0%

 
Liabilities
Current liabilities      
 Short-term loans

531

16,483

4.4%

 Payables

734

22,763

6.1%

 Current portion of long-term liabilities

761

23,599

6.3%

 Other current liabilities

241

7,480

2.0%

    Total current liabilities

2,267

70,325

18.8%

 
Non-current liabilities      
 Bonds payable

602

18,687

5.0%

 Long-term loans

1,178

36,543

9.8%

 Lease liabilities, noncurrent

170

5,258

1.4%

 Other non-current liabilities

1,231

38,187

10.2%

    Total non-current liabilities

3,181

98,675

26.4%

    Total liabilities

5,448

169,000

45.2%

 
Equity
Equity attributable to the parent company      
 Capital

3,780

117,243

31.3%

 Additional paid-in capital

1,269

39,360

10.5%

 Retained earnings, exchange differences on translation of 
    foreign operations, unrealized gains or losses on financial 
    assets measured at fair value through other comprehensive
    income and gains or losses on hedging Instruments

1,552

48,156

12.9%

 Treasury stock

(4)

(120)

(0.0%)

    Total equity attributable to the parent company

6,597

204,639

54.7%

Non-controlling interests

13

405

0.1%

    Total equity

6,610

205,044

54.8%

Total liabilities and equity

12,058

374,044

100.0%

 
           
Note:New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2019 exchange rate of NT $31.02 per U.S. Dollar.

 

 UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES

 Consolidated Condensed Statements of Comprehensive Income

 Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)

 Except Per Share and Per ADS Data

 
Year over Year Comparison Quarter over Quarter Comparison
Three-Month Period Ended Three-Month Period Ended
September 30, 2019 September 30, 2018 Chg. September 30, 2019 June 30, 2019 Chg.
US$ NT$ US$ NT$ % US$ NT$ US$ NT$ %
Operating revenues

1,217

37,738

1,270

39,387

(4.2%)

1,217

37,738

1,162

36,031

4.7%

Operating costs

(1,010)

(31,305)

(1,047)

(32,465)

(3.6%)

(1,010)

(31,305)

(980)

  

(30,379)

3.1%

Gross profit

207

6,433

223

6,922

(7.1%)

207

6,433

182

5,652

13.8%

17.1%

17.1%

17.6%

17.6%

17.1%

17.1%

15.7%

15.7%

Operating expenses
  - Sales and marketing expenses

(31)

(970)

(32)

(987)

(1.8%)

(31)

(970)

(31)

  

(953)

1.8%

  - General and administrative expenses

(43)

(1,344)

(45)

(1,386)

(2.9%)

(43)

(1,344)

(39)

  

(1,251)

7.5%

  - Research and development expenses

(91)

(2,813)

(107)

(3,329)

(15.5%)

(91)

(2,813)

(90)

  

(2,787)

0.9%

  - Expected credit losses

(0)

(4)

              -

              -

100.0%

(0)

(4)

(19)

  

(587)

(99.4%)

      Subtotal

(165)

(5,131)

(184)

(5,702)

(10.0%)

(165)

(5,131)

(179)

  

(5,578)

(8.0%)

Net other operating income and expenses

39

1,207

39

1,215

(0.6%)

39

1,207

54

  

1,687

(28.4%)

Operating income

81

2,509

78

2,435

3.0%

81

2,509

57

1,761

42.5%

6.7%

6.7%

6.2%

6.2%

6.7%

6.7%

4.9%

4.9%

 
Net non-operating income and expenses

(17)

(532)

(51)

(1,606)

(66.9%)

(17)

(532)

(20)

(617)

(13.9%)

Income from continuing operations
   before income tax

64

1,977

27

829

138.7%

64

1,977

37

1,144

72.9%

5.2%

5.2%

2.1%

2.1%

5.2%

5.2%

3.2%

3.2%

 
Income tax expense

(2)

(39)

(21)

(632)

(93.8%)

(2)

(39)

(7)

  

(202)

(80.7%)

Net income

62

1,938

6

197

884.7%

62

1,938

30

942

105.7%

5.1%

5.1%

0.5%

0.5%

5.1%

5.1%

2.6%

2.6%

 
Other comprehensive income (loss)

20

591

(50)

(1,568)

                 -

20

591

24

  

743

(20.5%)

 
Total comprehensive income (loss)

82

2,529

(44)

(1,371)

                 -

82

2,529

54

  

1,685

50.1%

 
    Net income attributable to:
Stockholders of the parent

94

2,929

55

1,720

70.2%

94

2,929

56

  

1,740

68.3%

Non-controlling interests

(32)

(991)

(49)

(1,523)

(35.0%)

(32)

(991)

(26)

  

(798)

24.1%

 
    Comprehensive income (loss) attributable to:
Stockholders of the parent

114

3,540

9

279

1,169.8%

114

3,540

80

  

2,488

42.3%

Non-controlling interests

(32)

(1,011)

(53)

(1,650)

(38.7%)

(32)

(1,011)

(26)

  

(803)

26.0%

 
Earnings per share-basic

0.008

0.25

0.005

0.14

0.008

0.25

0.005

0.15

Earnings per ADS (2)

0.040

1.25

0.023

0.70

0.040

1.25

0.024

0.75

Weighted average number of shares
outstanding (in millions)   

11,708

  

12,054

  

11,708

  

11,818

 
                                       
Notes:
(1) New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2019 exchange rate of NT $31.02 per U.S. Dollar.
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES
Consolidated Condensed Statements of Comprehensive Income
Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)
Except Per Share and Per ADS Data
 
For the Three-Month Period Ended For the Nine-Month Period Ended
September 30, 2019 September 30, 2019
US$ NT$ % US$  NT$  %
Operating revenues

1,217

37,738

100.0%

3,429

106,353

100.0%

Operating costs

(1,010)

(31,305)

(82.9%)

(2,966)

(92,006)

(86.5%)

Gross profit

207

6,433

17.1%

463

14,347

13.5%

 
 
Operating expenses
  - Sales and marketing expenses

(31)

(970)

(2.6%)

(91)

(2,811)

(2.6%)

  - General and administrative expenses

(43)

(1,344)

(3.5%)

(124)

(3,833)

(3.6%)

  - Research and development expenses

(91)

(2,813)

(7.5%)

(271)

(8,407)

(7.9%)

  - Expected credit losses

(0)

(4)

(0.0%)

(19)

(591)

(0.6%)

      Subtotal

(165)

(5,131)

(13.6%)

(505)

(15,642)

(14.7%)

Net other operating income and expenses

39

1,207

3.2%

128

3,967

3.7%

Operating income

81

2,509

6.7%

86

2,672

2.5%

 
Net non-operating income and expenses

(17)

(532)

(1.5%)

3

99

0.1%

Income from continuing operations 
   before income tax

64

1,977

5.2%

89

2,771

2.6%

 
 
Income tax benefit (expense)

(2)

(39)

(0.1%)

7

202

0.2%

Net income

62

1,938

5.1%

96

2,973

2.8%

           
Other comprehensive income (loss)

20

591

1.6%

159

4,947

4.7%

 
Total comprehensive income (loss)

82

2,529

6.7%

255

7,920

7.5%

 
    Net income attributable to:
Stockholders of the parent

94

2,929

7.8%

189

5,871

5.5%

Non-controlling interests

(32)

(991)

(2.7%)

(93)

(2,898)

(2.7%)

 
    Comprehensive income (loss) attributable to:
Stockholders of the parent

114

3,540

9.4%

349

10,841

10.2%

Non-controlling interests

(32)

(1,011)

(2.7%)

(94)

(2,921)

(2.7%)

 
Earnings per share-basic

0.008

0.25

0.016

0.50

Earnings per ADS (2)

0.040

1.25

0.081

2.50

 
Weighted average number of shares
     outstanding (in millions)

11,708

11,811

                       
Notes:
(1) New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2019 exchange rate of NT $31.02 per U.S. Dollar.
(2) 1 ADS equals 5 common shares.

 

UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES
Consolidated Condensed Statement of Cash Flows
For The Nine-Month Period Ended September 30, 2019
 Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)
 
US$ NT$
Cash flows from operating activities :
    Net income before tax

89

2,771

    Depreciation & Amortization

1,180

36,615

    Expected credit losses

19

591

    Share of profit of associates and joint ventures

(16)

(506)

    Income tax paid

(18)

(567)

    Changes in working capital & others

(694)

(21,532)

Net cash provided by operating activities

560

17,372

 
Cash flows from investing activities :
    Acquisition of property, plant and equipment

(420)

(13,017)

    Acquisition of intangible assets

(49)

(1,509)

    Others

23

688

Net cash used in investing activities

(446)

(13,838)

 
Cash flows from financing activities :
    Increase in short-term loans

113

3,493

    Redemption of bonds

(81)

(2,500)

    Proceeds from long-term loans

369

11,459

    Repayments of long-term loans

(81)

(2,518)

    Cash dividends 

(223)

(6,914)

    Treasury stock acquired

(96)

(2,972)

    Others

(6)

(199)

Net cash used in financing activities

(5)

(151)

 
Effect of exchange rate changes on cash and cash equivalents

(9)

(287)

Net increase in cash and cash equivalents

100

3,096

 
Cash and cash equivalents at beginning of period

2,697

83,662

 
Cash and cash equivalents at end of period

2,797

86,758

 
Reconciliation of the balances of cash and cash equivalents at end of period :
Cash and cash equivalents balances on the consolidated balance sheets

2,797

86,755

Cash and cash equivalents included in non-current assets held for sale

0

3

Cash and cash equivalents at end of period

2,797

86,758

 
       
Note: New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2019 exchange rate of NT $31.02 per U.S. Dollar.

 

1Unless otherwise stated, all financial figures discussed in this announcement are prepared in accordance with TIFRSs recognized by Financial Supervisory Commission in the ROC, which is different from IFRSs issued by the International Accounting Standards Board. They represent comparisons among the three-month period ending September 30, 2019, the three-month period ending June 30, 2019, and the equivalent three-month period that ended September 30, 2018. For all 3Q19 results, New Taiwan Dollar (NT$) amounts have been converted into U.S. Dollars at the September 30, 2019 exchange rate of NT$ 31.02 per U.S. Dollar.
2 Revenue in this section represents wafer sales
3 Utilization Rate = Quarterly Wafer Out / Quarterly Capacity
4 Estimated capacity numbers are based on calculated maximum output rather than designed capacity. The actual capacity numbers may differ depending upon equipment delivery schedules, pace of migration to more advanced process technologies, and other factors affecting production ramp-up.

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