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UMC Reports Third Quarter 2020 Results

·17 min read

3Q20 operating income grew 22% QoQ

Company posts 3Q20 net income of NT$9.11 billion or NT$0.75 EPS

Third Quarter 2020 Overview1:

  • Revenue: NT$44.87 billion (US$1.54 billion)

  • Gross margin: 21.8%; Operating margin: 15.9%

  • Revenue from 28nm: 14%

  • Capacity utilization rate: 97%

  • Net income attributable to stockholders of the parent: NT$9.11 billion (US$313 million)

  • Earnings per share: NT$0.75; earnings per ADS: US$0.129

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 2020.

Third quarter consolidated revenue was NT$44.87 billion, compared to NT$44.39 billion in 2Q20 and up 18.9% YoY from NT$37.74 billion in 3Q19. Consolidated gross margin for 3Q20 was 21.8%. Net income attributable to the stockholders of the parent was NT$9.11 billion, with earnings per ordinary share of NT$0.75.

Jason Wang, co-president of UMC, said, "During the third quarter, consolidated operating margin reached 15.9%, while utilization rate remained firm at 97%. Wafer shipments reached 2.25 million 8-inch equivalent wafers. During Q3, work-from-home and home schooling trends continued to contribute to stable end market demand for applications in wireless connectivity, power management ICs used in smartphones as well as high speed interface I/O controllers found in computing devices. In addition to demand stability across various end markets, our 28nm revenue grew QoQ as customer product tape outs continued throughout the quarter. Moving forward, we expect to see a sustained increase in the number of 28nm tape outs, which will further diversify our 28nm exposure to end markets and customers."

Co-president Wang continued, "Looking into the fourth quarter, demand from consumer and computer related applications will lead to a minor increase in wafer shipments, propelled by ongoing work-from-home initiatives and home schooling. Furthermore, we have seen an uptick in semiconductor demand due to more silicon content in particular applications such as newly deployed 5G smartphones, IoT devices and other consumer products. Therefore, the current industry landscape appears to show favorable supply and demand dynamics towards foundry; hence, UMC will pursue a delicate balance in strengthening our customer relationships while securing interests for our shareholders to ensure our long term growth."

Summary of Operating Results

Operating Results

(Amount: NT$ million)

3Q20

2Q20

QoQ %
change

3Q19

YoY %
change

Operating Revenues

44,870

44,386

1.1

37,738

18.9

Gross Profit

9,769

10,257

(4.8

)

6,433

51.9

Operating Expenses

(5,508

)

(5,677

)

(3.0

)

(5,131

)

7.4

Net Other Operating Income and Expenses

2,872

1,266

126.9

1,207

137.9

Operating Income

7,133

5,846

22.0

2,509

184.3

Net Non-Operating Income and Expenses

2,074

818

153.4

(532

)

-

Net Income Attributable to Stockholders of the Parent

9,106

6,681

36.3

2,929

210.9

EPS (NT$ per share)

0.75

0.55

0.25

(US$ per ADS)

0.129

0.095

0.043

Operating revenues in 3Q20 remained flat at NT$44.87 billion. Revenue contribution from 40nm and below technologies increased to 37%. Gross profit declined 4.8% QoQ to NT$9.77 billion, or 21.8% of revenue. Operating expenses declined 3.0% to NT$5.51 billion. Net other operating income increased 126.9% to NT$2.87 billion, which included the sale of Nexpower Technology Corporation’s manufacturing plant, leading to an operating income of NT$7.13 billion. Net non-operating income was NT$2.07 billion. Net income attributable to stockholders of the parent grew 36.3% QoQ to NT$9.11 billion.

Earnings per ordinary share for the quarter was NT$0.75. Earnings per ADS was US$0.129. The basic weighted average number of outstanding shares in 3Q20 was 12,107,651,452, compared with 12,193,149,897 shares in 2Q20 and 11,708,239,978 shares in 3Q19. The diluted weighted average number of outstanding shares was 12,179,561,492 in 3Q20, compared with 12,262,774,432 shares in 2Q20 and 13,049,025,428 shares in 3Q19. The fully diluted share count as of September 30, 2020 was approximately 12,294,281,000. On September 30, 2020, UMC sold 105 million treasury shares acquired from the 21th share buy-back programs to its employees.

Detailed Financials Section

COGS & Expenses

(Amount: NT$ million)

3Q20

2Q20

QoQ %
change

3Q19

YoY %
change

Operating Revenues

44,870

44,386

1.1

37,738

18.9

COGS

(35,101

)

(34,129

)

2.8

(31,305

)

12.1

Depreciation

(10,911

)

(10,544

)

3.5

(10,707

)

1.9

Other Mfg. Costs

(24,190

)

(23,585

)

2.6

(20,598

)

17.4

Gross Profit

9,769

10,257

(4.8

)

6,433

51.9

Gross Margin (%)

21.8

%

23.1

%

17.1

%

Operating Expenses

(5,508

)

(5,677

)

(3.0

)

(5,131

)

7.4

G&A

(1,614

)

(1,537

)

4.9

(1,344

)

20.1

Sales & Marketing

(1,009

)

(929

)

8.7

(970

)

4.1

R&D

(3,314

)

(3,203

)

3.5

(2,813

)

17.8

Expected Credit
Impairment Gain
(Loss)

429

(8

)

-

(4

)

-

Net Other Operating
Income & Expenses

2,872

1,266

126.9

1,207

137.9

Operating Income

7,133

5,846

22.0

2,509

184.3

Operating revenues remained relatively flat at NT$44.87 billion. COGS increased 2.8% QoQ to NT$35.10 billion, which included low single digit increases in both depreciation and other manufacturing costs. Gross profit declined by 4.8% to NT$9.77 billion, partly due to the appreciation of the NT dollar. Operating expenses declined 3% QoQ to NT$5.51 billion, as sales and marketing expenses rose 8.7% QoQ to NT$1.01 billion. G&A expenses grew 4.9% to NT$1.61 billion. R&D expenses increased 3.5% sequentially to NT$3.31 billion, representing 7.4% of 3Q20 operating revenues. Net other operating income increased to NT$2.87 billion. In 3Q20, operating income increased 22.0% QoQ to NT$7.13 billion.

Non-Operating Income and Expenses

(Amount: NT$ million)

3Q20

2Q20

3Q19

Non-Operating Income and Expenses

2,074

818

(532

)

Net Interest Income and Expenses

(314

)

(307

)

(503

)

Net Investment Gain and Loss

3,944

1,643

736

Exchange Gain and Loss

259

(411

)

(752

)

Other Gain and Loss

(1,815

)

(107

)

(13

)

Net non-operating income in 3Q20 was NT$2.07 billion, mainly resulting from NT$3.94 billion in net investment gain and NT$259 million in exchange gain, which was partly offset by NT$1.82 billion in other losses and NT$314 million in net interest expense.

Cash Flow Summary

(Amount: NT$ million)

For the 3-Month
Period Ended
Sep. 30, 2020

For the 3-Month
Period Ended
Jun. 30, 2020

Cash Flow from Operating Activities

18,538

16,403

Net income before tax

9,207

6,664

Depreciation & Amortization

12,170

12,248

Expected credit impairment (gain) loss

(429

)

8

Share of profit of associates and joint
ventures

(2,778

)

(914

)

Income tax (paid) received

(229

)

505

Changes in working capital & others

597

(2,108

)

Cash Flow from Investing Activities

(5,686

)

(7,877

)

Acquisition of PP&E

(6,707

)

(4,270

)

Proceeds from disposal of PP&E

1,720

14

Acquisition of intangible assets

(815

)

(448

)

Decrease (increase) in other financial
assets

281

(2,979

)

Others

(165

)

(194

)

Cash Flow from Financing Activities

(13,652

)

(2,947

)

Bank loans

(4,716

)

9,483

Redemption of bonds

-

(11,203

)

Treasury stock acquired

(477

)

(1,201

)

Treasury stock sold to employees

1,678

-

Cash dividends

(9,765

)

-

Others

(372

)

(26

)

Effect of Exchange Rate

(233

)

(873

)

Net Cash Flow

(1,033

)

4,706

Beginning balance

99,872

95,166

Ending balance

98,839

99,872

In 3Q20, cash inflow from operating activities was NT$18.54 billion. Cash outflow from investing activities totaled NT$5.69 billion, which included NT$7.42 billion in capital expenditure, resulting in free cash flow of NT$11.12 billion. Cash outflow from financing activities totaled NT$13.65 billion, primarily from NT$9.77 billion in the distribution of cash dividend and NT$4.72 billion in the repayment of bank loans, offset by NT$1.68 billion in the sale of treasury stock to employees. Net cash outflow in 3Q20 was NT$1.03 billion. Over the next 12 months, the company expects to repay NT$6.83 billion in bank loans.

Current Assets

(Amount: NT$ billion)

3Q20

2Q20

3Q19

Cash and Cash Equivalents

98.84

99.87

86.76

Notes & Accounts Receivable

26.96

27.26

23.41

Days Sales Outstanding

55

57

58

Inventories, net

22.86

23.34

19.99

Days of Inventory

60

61

58

Total Current Assets

163.48

167.96

163.49

Cash and cash equivalents decreased to NT$98.84 billion. Days of inventory decreased to 60 days.

Liabilities

(Amount: NT$ billion)

3Q20

2Q20

3Q19

Total Current Liabilities

59.15

65.11

70.33

Notes & Accounts Payable

7.70

8.56

6.63

Short-Term Credit / Bonds

16.40

17.32

40.08

Payables on Equipment

7.38

3.22

3.00

Dividends Payable

-

9.77

-

Other

27.67

26.24

20.62

Long-Term Credit / Bonds

49.46

53.50

55.23

Long-Term Investment Liabilities

20.14

19.69

20.17

Total Liabilities

147.33

158.34

169.00

Debt to Equity

67

%

76

%

82

%

Current liabilities decreased to NT$59.15 billion, mainly from NT$9.77 billion in the payment of cash dividends and NT$0.92 billion from the decline in short-term credit/bonds. Total liabilities declined to NT$147.33 billion, leading to a debt to equity ratio of 67%.

Analysis of Revenue2

Revenue Breakdown by Region

Region

3Q20

2Q20

1Q20

4Q19

3Q19

North America

30

%

31

%

29

%

30

%

33

%

Asia Pacific

57

%

55

%

56

%

55

%

59

%

Europe

6

%

5

%

6

%

6

%

6

%

Japan

7

%

9

%

9

%

9

%

2

%

Revenue from Asia Pacific rose to 57% as business from North America declined to 30% of sales. Business from Europe rose to 6% while contribution from Japan decreased to 7%.

Revenue Breakdown by Geometry

Geometry

3Q20

2Q20

1Q20

4Q19

3Q19

14nm and below

0

%

0

%

0

%

0

%

0

%

14nm<x<=28nm

14

%

13

%

9

%

10

%

12

%

28nm<x<=40nm

23

%

23

%

25

%

22

%

26

%

40nm<x<=65nm

19

%

16

%

16

%

16

%

14

%

65nm<x<=90nm

10

%

13

%

15

%

18

%

12

%

90nm<x<=0.13um

11

%

11

%

11

%

11

%

11

%

0.13um<x<=0.18um

13

%

13

%

13

%

12

%

13

%

0.18um<x<=0.35um

8

%

8

%

8

%

8

%

9

%

0.5um and above

2

%

3

%

3

%

3

%

3

%

Revenue contribution from 28nm increased to 14% while 40nm business remained unchanged at 23% of sales.

Revenue Breakdown by Customer Type

Customer Type

3Q20

2Q20

1Q20

4Q19

3Q19

Fabless

88

%

88

%

88

%

87

%

92

%

IDM

12

%

12

%

12

%

13

%

8

%

Revenue from fabless customers stayed at 88% of revenue.

Revenue Breakdown by Application (1)

Application

3Q20

2Q20

1Q20

4Q19

3Q19

Computer

13

%

14

%

13

%

13

%

13

%

Communication

54

%

51

%

54

%

54

%

54

%

Consumer

24

%

24

%

24

%

24

%

26

%

Others

9

%

11

%

9

%

9

%

7

%

Revenue from the communication segment increased to 54%, while business from computer applications declined to 13%. Business from consumer applications remained unchanged at 24% as other segments decreased to 9%.

(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

Blended average selling price (ASP) increased slightly in 3Q20.

(To view blended ASP trend, please click here for 3Q20 ASP)

Shipment and Utilization Rate3

Wafer Shipments

3Q20

2Q20

1Q20

4Q19

3Q19

Wafer Shipments
(8" K equivalents)

2,254

2,218

2,148

2,042

1,806

Quarterly Capacity Utilization Rate

3Q20

2Q20

1Q20

4Q19

3Q19

Utilization Rate

97

%

98

%

93

%

92

%

91

%

Total Capacity
(8" K equivalents)

2,308

2,291

2,278

2,237

2,004

In 3Q20, wafer shipments increased 1.6% QoQ to 2,254K, while quarterly capacity rose 0.7% QoQ to 2,308K. As a result, the overall utilization rate in 3Q20 was 97%.

Capacity4

Annual Capacity in
thousands of wafers

Quarterly Capacity in
thousands of wafers

FAB

Geometry
(um)

2019

2018

2017

2016

FAB

4Q20E

3Q20

2Q20

1Q20

WTK

6"

3.5 – 0.45

370

396

422

423

WTK

93

93

93

92

Fab 8A

8"

0.5 – 0.25

825

825

825

827

Fab 8A

201

201

201

200

Fab 8C

8"

0.35 – 0.11

436

383

357

348

Fab 8C

113

113

113

112

Fab 8D

8"

0.13 – 0.09

359

347

341

342

Fab 8D

93

93

93

92

Fab 8E

8"

0.5 – 0.15

426

418

418

419

Fab 8E

113

113

113

112

Fab 8F

8"

0.18 – 0.11

434

431

417

401

Fab 8F

122

122

122

121

Fab 8S

8"

0.18 – 0.11

372

372

347

336

Fab 8S

93

93

93

93

Fab 8N

8"

0.5 – 0.11

831

771

753

750

Fab 8N

230

230

230

228

Fab 12A

12"

0.13 – 0.014

997

997

970

885

Fab 12A

261

261

261

260

Fab 12i

12"

0.13 – 0.040

595

555

537

584

Fab 12i

160

160

155

154

Fab 12X

12"

0.040 – 0.028

203

183

97

9

Fab 12X

57

56

53

52

Fab 12M

12"

0.090 – 0.040

98

-

-

-

Fab 12M

98

98

98

97

Total(1)

8,148

7,673

7,304

6,983

Total

2,311

2,308

2,291

2,278

YoY Growth Rate

6

%

5

%

5

%

6

%

Total capacity in the third quarter totaled 2,308K 8-inch equivalent wafers. We foresee fourth quarter capacity will grow to 2,311K 8-inch equivalent wafers, mainly reflecting capacity increase at Fab 12X.

(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. Total capacity figures are expressed in 8-inch equivalent wafers.

Capital Expenditure by Year - in US$ billion

Year

2019

2018

2017

2016

2015

CAPEX

$

0.6

$

0.7

$

1.4

$

2.8

$

1.9

2020 CAPEX Plan

8"

12"

Total

15

%

85

%

US$1.0 billion

CAPEX spending in 3Q20 was US$252 million, leading to a total of US$540 million in capital expenditure investment during the first nine months of 2020. Full year 2020 CAPEX is budgeted at US$1.0 billion.

Fourth Quarter 2020 Outlook & Guidance

Quarter-over-Quarter Guidance:

  • Wafer Shipments: To increase by 1-2%

  • ASP in USD: To increase by 1%

  • Gross Profit Margin: To remain flat

  • Capacity Utilization: mid-90% range

  • 2020 CAPEX: US$1 billion

Recent Developments / Announcements

Oct 29, 2020

UMC and US Department of Justice Reach Plea Agreement on Trade Secret Case

Jul 29, 2020

UMC 2Q20 Financial Results

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

Conference Call / Webcast Announcement

Thursday, October 29, 2020

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 3Q20 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 high quality IC production with a focus on both logic and specialty technologies to serve every major sector of the electronics industry. UMC’s comprehensive technology and manufacturing solutions include logic/RF, embedded high voltage, embedded flash, RFSOI/BCD and IATF-16949 automotive manufacturing certification for all its manufacturing facilities. UMC operates 12 fabs that are strategically located throughout Asia with a maximum capacity of more than 750,000 8-inch equivalent wafers per month. The company employs approximately 19,500 people worldwide, with offices in Taiwan, China, United States, Europe, Japan, Korea and Singapore. For more information, please visit: http://www.umc.com.

Safe Harbor Statements

This press release contains 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. These forward-looking statements include, but are not limited to, statements regarding anticipated sales for first quarter; product releases and market shares; opportunities in the 5G and IoT markets; anticipated wafer demands in market segments; execution of corporate strategies; repayment of bank loans; expected foundry capacities; the ability to obtain new business opportunities; and information under the heading "First Quarter of 2020 Outlook and Guidance."

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, including its Annual Report on Form 20-F. 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.

- FINANCIAL TABLES TO FOLLOW -

UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES

Consolidated Condensed Balance Sheet

As of September 30, 2020

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

September 30, 2020

US$

NT$

%

Assets

Current assets

Cash and cash equivalents

3,397

98,839

26.8

%

Notes & Accounts receivable, net

926

26,959

7.3

%

Inventories, net

786

22,863

6.2

%

Other current assets

509

14,816

4.1

%

Total current assets

5,618

163,477

44.4

%

Non-current assets

Funds and investments

1,617

47,041

12.8

%

Property, plant and equipment

4,559

132,662

36.0

%

Right-of-use assets

272

7,901

2.2

%

Other non-current assets

588

17,163

4.6

%

Total non-current assets

7,036

204,767

55.6

%

Total assets

12,654

368,244

100.0

%

Liabilities

Current liabilities

Short-term loans

260

7,572

2.1

%

Payables

1,196

34,806

9.5

%

Current portion of long-term liabilities

303

8,826

2.4

%

Other current liabilities

274

7,947

2.1

%

Total current liabilities

2,033

59,151

16.1

%

Non-current liabilities

Bonds payable

574

16,690

4.5

%

Long-term loans

1,126

32,767

8.9

%

Lease liabilities, noncurrent

178

5,184

1.4

%

Other non-current liabilities

1,152

33,537

9.1

%

Total non-current liabilities

3,030

88,178

23.9

%

Total liabilities

5,063

147,329

40.0

%

Equity

Equity attributable to the parent company

Capital

4,269

124,224

33.7

%

Additional paid-in capital

1,474

42,903

11.7

%

Retained earnings and other components of equity

1,847

53,754

14.6

%

Treasury stock

(4

)

...

(120

)

(0.0

%)

Total equity attributable to the parent company

7,586

220,761

60.0

%

Non-controlling interests

5

154

0.0

%

Total equity

7,591

220,915

60.0

%

Total liabilities and equity

12,654

368,244

100.0

%

Note:New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2020 exchange rate of NT $29.10 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, 2020

September 30, 2019

Chg.

September 30, 2020

June 30, 2020

Chg.

US$

NT$

US$

NT$

%

US$

NT$

US$

NT$

%

Operating revenues

1,542

44,870

1,297

37,738

18.9

%

1,542

44,870

1,525

44,386

1.1

%

Operating costs

(1,206

)

(35,101

)

(1,076

)

(31,305

)

12.1

%

(1,206

)

(35,101

)

(1,173

)

(34,129

)

2.8

%

Gross profit

336

9,769

221

6,433

51.9

%

336

9,769

352

10,257

(4.8

%)

21.8

%

21.8

%

17.1

%

17.1

%

21.8

%

21.8

%

23.1

%

23.1

%

Operating expenses

- Sales and marketing expenses

(35

)

(1,009

)

(33

)

(970

)

4.1

%

(35

)

(1,009

)

(32

)

(929

)

8.7

%

- General and administrative expenses

(56

)

(1,614

)

(46

)

(1,344

)

20.1

%

(56

)

(1,614

)

(53

)

(1,537

)

4.9

%

- Research and development expenses

(114

)

(3,314

)

(97

)

(2,813

)

17.8

%

(114

)

(3,314

)

(110

)

(3,203

)

3.5

%

- Expected credit impairment gain (loss)

15

429

(0

)

(4

)

-

15

429

(0

)

(8

)

-

Subtotal

(190

)

(5,508

)

(176

)

(5,131

)

7.4

%

(190

)

(5,508

)

(195

)

(5,677

)

(3.0

%)

Net other operating income and expenses

99

2,872

41

1,207

137.9

%

99

2,872

44

1,266

126.9

%

Operating income

245

7,133

86

2,509

184.3

%

245

7,133

201

5,846

22.0

%

15.9

%

15.9

%

6.7

%

6.7

%

15.9

%

15.9

%

13.2

%

13.2

%

Net non-operating income and expenses

71

2,074

(18

)

(532

)

-

71

2,074

28

818

153.4

%

Income from continuing operations
before income tax

316

9,207

68

1,977

365.6

%

316

9,207

229

6,664

38.2

%

20.5

%

20.5

%

5.2

%

5.2

%

20.5

%

20.5

%

15.0

%

15.0

%

Income tax expenses

(6

)

(197

)

(1

)

(39

)

405.4

%

(6

)

(197

)

(21

)

(613

)

(67.9

%)

Net income

310

9,010

67

1,938

364.8

%

310

9,010

208

6,051

48.9

%

20.1

%

20.1

%

5.1

%

5.1

%

20.1

%

20.1

%

13.6

%

13.6

%

Other comprehensive income (loss)

47

1,390

20

591

135.5

%

47

1,390

109

3,178

(56.2

%)

Total comprehensive income (loss)

357

10,400

87

2,529

311.3

%

357

10,400

317

9,229

12.7

%

Net income attributable to:

Stockholders of the parent

313

9,106

101

2,929

210.9

%

313

9,106

230

6,681

36.3

%

Non-controlling interests

(3

)

(96

)

(34

)

(991

)

(90.2

%)

(3

)

(96

)

(22

)

(630

)

(84.6

%)

Comprehensive income (loss) attributable to:

Stockholders of the parent

361

10,497

122

3,540

196.5

%

361

10,497

339

9,859

6.5

%

Non-controlling interests

(4

)

(97

)

(35

)

(1,011

)

(90.4

%)

(4

)

(97

)

(22

)

(630

)

(84.6

%)

Earnings per share-basic

0.026

0.75

0.009

0.25

0.026

0.75

0.019

0.55

Earnings per ADS (2)

0.129

3.75

0.043

1.25

0.129

3.75

0.095

2.75

Weighted average number of shares

outstanding (in millions)

12,108

11,708

12,108

12,193

Notes:

(1) New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2020 exchange rate of NT $29.10 per U.S. Dollar.

(2) 1 ADS equals 5 common shares.

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, 2020

September 30, 2020

US$

NT$

%

US$

NT$

%

Operating revenues

1,542

44,870

100.0

%

4,520

131,525

100.0

%

Operating costs

(1,206

)

(35,101

)

(78.2

%)

(3,553

)

(103,376

)

(78.6

%)

Gross profit

336

9,769

21.8

%

967

28,149

21.4

%

Operating expenses

- Sales and marketing expenses

(35

)

(1,009

)

(2.3

%)

(102

)

(2,978

)

(2.3

%)

- General and administrative expenses

(56

)

(1,614

)

(3.6

%)

(162

)

(4,696

)

(3.5

%)

- Research and development expenses

(114

)

(3,314

)

(7.4

%)

(333

)

(9,702

)

(7.4

%)

- Expected credit impairment gain

15

429

1.0

%

16

468

0.4

%

Subtotal

(190

)

(5,508

)

(12.3

%)

(581

)

(16,908

)

(12.8

%)

Net other operating income and expenses

99

2,872

6.4

%

177

5,152

3.9

%

Operating income

245

7,133

15.9

%

563

16,393

12.5

%

Net non-operating income and expenses

71

2,074

4.6

%

11

299

0.2

%

Income from continuing operations
before income tax

316

9,207

20.5

%

574

16,692

12.7

%

Income tax expense

(6

)

(197

)

(0.4

%)

(14

)

(401

)

(0.3

%)

Net income

310

9,010

20.1

%

560

16,291

12.4

%

Other comprehensive income (loss)

47

1,390

3.1

%

29

854

0.6

%

Total comprehensive income (loss)

357

10,400

23.2

%

589

17,145

13.0

%

Net income attributable to:

Stockholders of the parent

313

9,106

20.3

%

618

17,994

13.7

%

Non-controlling interests

(3

)

(96

)

(0.2

%)

(58

)

(1,703

)

(1.3

%)

Comprehensive income (loss) attributable to:

Stockholders of the parent

361

10,497

23.4

%

643

18,721

14.2

%

Non-controlling interests

(4

)

(97

)

(0.2

%)

(54

)

(1,576

)

(1.2

%)

Earnings per share-basic

0.026

0.75

0.052

1.50

Earnings per ADS (2)

0.129

3.75

0.258

7.50

Weighted average number of shares
outstanding (in millions)

12,108

12,028

Notes:

(1) New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2020 exchange rate of NT $29.10 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, 2020

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

US$

NT$

Cash flows from operating activities :

Net income before tax

574

16,692

Depreciation & Amortization

1,269

36,915

Share of profit of associates and joint ventures

(98

)

(2,846

)

Changes in working capital & others

(38

)

(1,088

)

Net cash provided by operating activities

1,707

49,673

Cash flows from investing activities :

Acquisition of property, plant and equipment

(502

)

(14,608

)

Proceeds from disposal of property, plant and equipment

60

1,757

Acquisition of intangible assets

(59

)

(1,716

)

Increase in other financial assets

(268

)

(7,812

)

Others

(10

)

(295

)

Net cash used in investing activities

(779

)

(22,674

)

Cash flows from financing activities :

Decrease in short-term loans

(147

)

(4,284

)

Redemption of bonds

(471

)

(13,703

)

Proceeds from long-term loans

449

13,070

Repayments of long-term loans

(226

)

(6,583

)

Cash dividends

(336

)

(9,765

)

Treasury stock acquired

(58

)

(1,678

)

Treasury stock sold to employees

58

1,678

Others

(40

)

(1,184

)

Net cash used in financing activities

(771

)

(22,449

)

Effect of exchange rate changes on cash and cash equivalents

(42

)

(1,203

)

Net increase in cash and cash equivalents

115

3,347

Cash and cash equivalents at beginning of period

3,282

95,492

Cash and cash equivalents at end of period

3,397

98,839

Note: New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2020 exchange rate of NT $29.10 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, 2020, the three-month period ending June 30, 2020, and the equivalent three-month period that ended September 30, 2019. For all 3Q20 results, New Taiwan Dollar (NT$) amounts have been converted into U.S. Dollars at the September 30, 2020 exchange rate of NT$ 29.10 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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201029005539/en/

Contacts

Michael Lin / David Wong
UMC, Investor Relations
+ 886-2-2658-9168, ext. 16900
jinhong_lin@umc.com
david_wong@umc.com