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1998 Second
Quarter Financial Reports |
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Taiwan Semiconductor Manufacturing Company
Ltd. Announces
Second Quarter Results for the Period
Ended
June 30, 1998 |
| Hsin-Chu, Taiwan, R. O. C., July 20, 1998;
Taiwan Semiconductor Manufacturing Company Ltd. (TAIEX: 2330,
NYSE: TSM), ("TSMC" or "the Company") the
world's largest dedicated semiconductor foundry company, announced
today the results of its operations for the second quarter ended
June 30, 1998. All figures were prepared in accordance with
generally accepted accounting principles in Taiwan. |
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| 2Q 98 Year-over-Year Financial Highlights |
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Net sales increased 25.0%
to NT$11,601 million. |
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Operating income and net income for
the period increased 37.2% to NT$3,773 million and 6.1%
to NT$3,758 million, respectively. |
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Diluted earnings per share in the second
quarter of 1998 rose to NT$0.62 from NT$0.59 in the second
quarter of 1997, an increase of 6.1%. |
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| SECOND QUARTER RESULTS: YEAR-OVER-YEAR
COMPARISON |
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Net Sales: |
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Net sales in the second quarter of
1998 totaled NT$11,601 million, an increase of 25.0% from
the same period a year ago, due to both increased unit
sales of 8" equivalent wafers and a higher average
selling price (ASP). Unit sales of 8" equivalent
wafers increased by 5.3% to 276.6K units in the second
quarter of 1998 from 262.6K units in the second quarter
of 1997. The ASP rose 22.7% to NT$38.1k in the second
quarter of 1998 from NT$31.1k in the second quarter of
1997. However in US dollar terms, the ASP increased only
2.7% as the New Taiwan dollar fell from the weighted average
rate of NT$27.7 to NT$33.07 per US dollar. |
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Gross Margins: |
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The gross margin in the second quarter
of 1998 improved slightly from 42.2% in the second quarter
of 1997 to 45.3% mainly due to the higher ASP that helped
offset lower capacity utilization levels.
Operating Expenses:
Operating expenses in the second quarter of 1998 increased
27.4% from the same period a year ago to NT$1,484 million
due to higher R&D costs and overhead expenses, as
well as increased preliminary investment expense in
Fab 6 located in the Tainan Science-Based Industrial
Park. Sales and marketing costs were NT$283 million,
nearly unchanged from the same period a year ago. The
increase in operating expenses was well contained compared
to the growth in sales and operating margins rose to
32.5% in the second quarter of 1998 from 29.6% in the
second quarter of 1997.
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Non-Operating Income/Expenses: |
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Non-operating income declined by 26.7%
in the second quarter of 1998 to NT$166 million from NT$227
million in the second quarter of 1997 due to less investment
income. The investment loss for the quarter was NT$777
million mainly as a result of losses at Vanguard International
Semiconductor (VISC) and WaferTech. Non-operating expenses
were also sharply higher for the second quarter of 1998
due to an increase in interest expense of NT$267 million
as a result of the issuance of US$350 million EuroDollar
Convertible Bonds (ECB) in July1997. |
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Income Tax: |
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Income tax credit for the quarter rose
24% from NT$707 million in the second quarter of 1997
to NT$877 million mainly due to a higher adjustment of
the original tax provision made in 1997 as well as higher
capital expenditure and investments during the second
quarter of 1998. |
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Net Income: |
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Net income increased 6.1% to NT$3,758
million in the second quarter of 1998, and diluted earnings
per share were NT$0.62, up from NT$0.59 in 1997. |
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| 2Q 98 Sequential Financial
Highlights |
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Net sales fell 26.3% to
NT$11,601 million from NT$15,736 million. |
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Operating income and net income declined
43.8% and 45.9%, respectively. |
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Earnings per share also fell 45.9%
to NT$0.62 from NT$1.15 in 1Q 98. |
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| SECOND QUARTER RESULTS: SEQUENTIAL
COMPARISON |
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| Company Description: |
| Founded in 1987, TSMC is the
first and largest semiconductor foundry company in the world.
The company is based in Taiwan's "Silicon Valley",
the Hsin-Chu Science-Based Industrial Park, and is dedicated
to providing manufacturing services for advanced integrated
circuits to fabless design houses and integrated device manufacturers
(IDM). The company operates two 6" wafer fabs and three
8" wafer fabs offering a comprehensive set of IC fabrication
processes, including processes to manufacture CMOS logic, mixed
mode, volatile and non-volatile memory and BiCMOS chips. In
mid-1996, TSMC began construction on the first-ever, pure-play
foundry in the US, WaferTech, in Camas, Washington, - a $1.2
billion joint venture. Production at WaferTech commenced in
June 1998, one month ahead of schedule. Fab 6 and 7 will be
located in the new Tainan Science-Based Industrial Park in Taiwan.
Corporate Headquarters:
Taiwan Semiconductor Manufacturing Company Ltd.
No. 121, Park Avenue III, Hsin-Chu Science-Based Industrial
Park
Hsin-Chu, Taiwan, R. O. C.
Tel: 886/3/578-0221
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Investor Relations
