Annual Reports  >  2014  >  Financial Highlights > Financial Status and Operating Results
Financial Status and Operating Results
繁中

Financial Status

Consolidated

Unit: NT$ thousands

Item

2014

2013

Difference

%

Current Assets

626,566,787

358,486,654

268,080,133

75%

Long-term Investments (Note 1)

30,051,544

89,183,810

(59,132,266)

-66%

Property, Plant and Equipment

818,198,801

792,665,913

25,532,888

3%

Intangible Assets

13,531,510

11,490,383

2,041,127

18%

Other Assets (Note 2)

6,785,203

11,228,217

(4,443,014)

-40%

Total Assets

1,495,133,845

1,263,054,977

232,078,868

18%

Current Liabilities

201,014,777

189,777,934

11,236,843

6%

Noncurrent Liabilities

248,443,321

225,501,958

22,941,363

10%

Total Liabilities

449,458,098

415,279,892

34,178,206

8%

Capital Stock

259,296,624

259,286,171

10,453

0%

Capital Surplus

55,989,922

55,858,626

131,296

0%

Retained Earnings

704,512,664

518,193,152

186,319,512

36%

Others

25,749,291

14,170,306

11,578,985

82%

Equity Attributable to Shareholders of the Parent

1,045,548,501

847,508,255

198,040,246

23%

Total Equity

1,045,675,747

847,775,085

197,900,662

23%

Note 1: Long-term investments consist of noncurrent available-for-sale financial assets, financial assets carried at cost and investments accounted for using equity method.
Note 2: Other assets consist of deferred income tax assets, refundable deposits, and other noncurrent assets

Analysis of Deviation over 20%

The increase in current assets was mainly due to increase in cash and cash equivalents, available-for-sale financial assets and notes and accounts receivable in 2014.
The decrease in long-term investments was mainly due to reclassification of available-for-sale financial assets to current assets in 2014.
The decrease in other assets was mainly due to decrease in refundable deposits and deferred income tax assets.
The increase in retained earnings, equity attributable to shareholders of the parent and total equity was mainly due to net income of 2014, partially offset by distribution of 2013 earnings.
The increase in others was mainly due to increase in currency exchange differences arising from translation of foreign operations in 2014.

Major Impact on Financial Position

The above deviations had no major impact on TSMC’s financial position.

Future Plan on Financial Position: Not applicable.

Unconsolidated

Unit: NT$ thousands

Item

2014

2013

Difference

%

Current Assets

370,949,497

257,623,763

113,325,734

44%

Long-term Investments (Note 1)

242,390,122

165,545,159

76,844,963

46%

Property, Plant and Equipment

796,684,361

770,443,494

26,240,867

3%

Intangible Assets

8,996,810

7,069,456

1,927,354

27%

Other Assets (Note 2)

4,023,634

7,897,131

(3,873,497)

-49%

Total Assets

1,423,044,424

1,208,579,003

214,465,421

18%

Current Liabilities

178,261,092

187,195,744

(8,934,652)

-5%

Noncurrent Liabilities

199,234,831

173,875,004

25,359,827

15%

Total Liabilities

377,495,923

361,070,748

16,425,175

5%

Capital Stock

259,296,624

259,286,171

10,453

0%

Capital Surplus

55,989,922

55,858,626

131,296

0%

Retained Earnings

704,512,664

518,193,152

186,319,512

36%

Others

25,749,291

14,170,306

11,578,985

82%

Total Equity

1,045,548,501

847,508,255

198,040,246

23%

Note 1: Long-term investments consist of financial assets carried at cost and investments accounted for using equity method.
Note 2: Other assets consist of deferred income tax asset, refundable deposits, and other noncurrent assets.

Analysis of Deviation over 20%

The increase in current assets was mainly due to increase in cash and cash equivalents, receivables from related parties and inventories in 2014.
The increase in long-term investment was mainly due to increase in investments accounted for using equity method in 2014.
The increase in intangible assets was mainly due to increase in technology license fees in 2014.
The decrease in other assets was mainly due to decrease in refundable deposits and deferred income tax assets.
The increase in retained earnings and total equity was mainly due to net income of 2014, partially offset by distribution of 2013 earnings.
The increase in others was mainly due to increase in currency exchange differences arising from translation of foreign operations in 2014.

Major Impact on Financial Position

The above deviations had no major impact on TSMC’s financial position.

Future Plan on Financial Position: Not applicable.

Financial Performance

Consolidated

Unit: NT$ thousands

Item

2014

2013

Difference

(%)

Net Revenue

762,806,465

597,024,197

165,782,268

28%

Cost of Revenue

385,100,646

316,057,820

69,042,826

22%

Gross Profit before Realized (Unrealized) Gross Profit on Sales to Associates

377,705,819

280,966,377

96,739,442

34%

Realized (Unrealized) Gross Profit on Sales to Associates

28,556

(20,870)

49,426

NM (Note)

Gross Profit

377,734,375

280,945,507

96,788,868

34%

Operating Expenses

80,842,944

71,563,234

9,279,710

13%

Other Operating Income and Expenses, Net

(1,001,138)

47,090

(1,048,228)

-2,226%

Income from Operations

295,890,293

209,429,363

86,460,930

41%

Non-operating Income and Expenses

6,207,253

6,057,759

149,494

2%

Income before Income Tax

302,097,546

215,487,122

86,610,424

40%

Income Tax Expenses

38,316,677

27,468,185

10,848,492

39%

Net Income

263,780,869

188,018,937

75,761,932

40%

Other Comprehensive Income, Net of Income Tax

11,834,164

16,352,248

(4,518,084)

-28%

Total Comprehensive Income for the Year

275,615,033

204,371,185

71,243,848

35%

Total Net Income Attributable to Shareholders of the Parent

263,898,794

188,146,790

75,752,004

40%

Total Comprehensive Income Attributable to Shareholders of the Parent

275,717,141

204,505,782

71,211,359

35%

Note: NM stands for non-meaningful.

Analysis of Deviation over 20%

Increase in net revenue: The increase was mainly due to higher wafer shipments in 2014. Furthermore, the introduction of 20-nanometer and higher share of 28-nanometer sales contributed to a higher average selling price.
Increase in cost of revenue: The increase was mainly due to higher sales.
Increase in gross profit before realized (unrealized) gross profit on sales to associates and gross profit: The increase was mainly due to higher capacity utilization in 2014.
Increase in realized (unrealized) gross profit on sales to associates: The increase was mainly due to lower sales to associates in the fourth quarter 2014.
Decrease in other operating income and expenses, net: The decrease was mainly due to impairment loss on noncurrent assets held for sale and property, plant and equipment recognized in 2014.
Increase in income from operations: The increase was mainly due to gross profit increased at a higher rate than the increase in operating expenses.
Increase in income before income tax: The increase was mainly due to higher income from operations.
Increase in income tax expenses: The increase was mainly due to higher taxable income and increase in income tax on unappropriated earnings in 2014.
Increase in net income and total net income attributable to shareholders of the parent: The increase was mainly due to higher income before income tax.
Decrease in other comprehensive income, net of income tax: The decrease was mainly due to changes in fair value of available-for-sale financial assets, partially offset by currency exchange differences arising from translation of foreign operations in 2014.
Increase in total comprehensive income for the year and total comprehensive income attributable to shareholders of the parent: The increase was mainly due to higher net income in 2014.

Sales Volume Forecast and Related Information

For additional details, please refer to “ Letter to Shareholders” of this Annual Report.

Major Impact on Financial Performance

The above deviations had no major impact on TSMC’s financial performance.

Future Plan on Financial Performance: Not applicable.

Unconsolidated

Unit: NT$ thousands

Item

2014

2013

Difference

(%)

Net Revenue

757,152,389

591,087,600

166,064,789

28%

Cost of Revenue

390,272,233

319,407,163

70,865,070

22%

Gross Profit before Realized (Unrealized) Gross Profit on Sales to Subsidiaries and Associates

366,880,156

271,680,437

95,199,719

35%

Realized (Unrealized) Gross Profit on Sales to Subsidiaries and Associates

31,547

(35,577)

67,124

NM (Note)

Gross Profit

366,911,703

271,644,860

95,266,843

35%

Operating Expenses

76,261,094

66,924,354

9,336,740

14%

Other Operating Income and Expenses, Net

9,049

(66,614)

75,663

NM (Note)

Income from Operations

290,659,658

204,653,892

86,005,766

42%

Non-operating Income and Expenses

10,363,505

11,062,658

(699,153)

-6%

Income before Income Tax

301,023,163

215,716,550

85,306,613

40%

Income Tax Expenses

37,124,369

27,569,760

9,554,609

35%

Net Income

263,898,794

188,146,790

75,752,004

40%

Other Comprehensive Income, Net of Income Tax

11,818,347

16,358,992

(4,540,645)

-28%

Total Comprehensive Income for the Year

275,717,141

204,505,782

71,211,359

35%

Note: NM stands for non-meaningful.

Analysis of Deviation over 20%

Increase in net revenue: The increase was mainly due to higher wafer shipments in 2014. Furthermore, the introduction of 20-nanometer and higher share of 28-nanometer sales contributed to a higher average selling price.
Increase in cost of revenue: The increase was mainly due to higher sales.
Increase in gross profit before realized (unrealized) gross profit on sales to associates and gross profit: The increase was mainly due to higher capacity utilization in 2014.
Increase in realized (unrealized) gross profit on sales to subsidiaries and associates: The increase was mainly due to lower sales to subsidiaries and associates in the fourth quarter 2014.
Increase in other operating income and expenses, net: The increase was mainly due to higher net gain on disposal of property, plant and equipment in 2014.
Increase in income from operations: The increase was mainly due to gross profit increased at a higher rate than the increase in operating expenses.
Increase in income before income tax: The increase was mainly due to higher income from operations.
Increase in income tax expenses: The increase was mainly due to higher taxable income and increase in income tax on unappropriated earnings in 2014.
Increase in net income: The increase was mainly due to higher income before income tax.
Decrease in other comprehensive income, net of income tax: The decrease was mainly due to higher share of other comprehensive loss of subsidiaries and associates, partially offset by currency exchange differences arising from translation of foreign operations in 2014.
Increase in total comprehensive income: The increase was mainly due to higher net income in 2014.

Sales Volume Forecast and Related Information
For additional details, please refer to “Letter to Shareholders” of this Annual Report.

Major Impact on Financial Performance
The above deviations had no major impact on TSMC’s financial performance.

Future Plan on Financial Performance: Not applicable.

Cash Flow

Consolidated

Unit: NT$ thousands

Cash Balance 12/31/2013

Net Cash Provided by Operating Activities in 2014

Net Cash Used in Investing and Financing Activities in 2014

Cash Balance 12/31/2014

Remedy for Liquidity Shortfall

Investment Plan

Financing Plan

242,695,447

421,523,731

(305,770.149)

358.449,029

None

None

Analysis of Cash Flow

NT$421.5 billion net cash generated by operating activities: mainly from net income and depreciation and amortization expenses.
NT$282.4 billion net cash used in investing activities: primarily for capital expenditures.
NT$23.4 billion net cash used in financing activities: primarily for payment of cash dividends, partially offset by receipt of guarantee deposits and increase in short-term loans.

Remedial Actions for Liquidity Shortfall:
As a result of positive operating cash flows and cash on-hand, remedial actions are not required.

Cash Flow Projection for Next Year: Not applicable.

Unconsolidated

Unit: NT$ thousands

Cash Balance 12/31/2013

Net Cash Provided by Operating Activities in 2014

Net Cash Used in Investing and Financing Activities in 2014

Cash Balance 12/31/2014

Remedy for Liquidity Shortfall

Investment Plan

Financing Plan

146,438,768

410,511,003

(372,090,539)

184,859,232

None

None

Analysis of Cash Flow

NT$410.5 billion net cash generated by operating activities: mainly from net income and depreciation and amortization expenses.
NT$279.8 billion net cash used in investing activities: primarily for capital expenditures.
NT$92.3 billion net cash used in financing activities: primarily for payment of cash dividends and acquisition of interests in subsidiaries, partially offset by receipt of guarantee deposits and increase in short-term loans.

Remedial Actions for Liquidity Shortfall:
As a result of positive operating cash flows and cash on-hand, remedial actions are not required.

Cash Flow Projection for Next Year: Not applicable.

Major Capital Expenditures and Impact on Financial and Business

Unit: NT$ thousands

Plan Actual or Planned Source of Capital

Total Amount as of 12/31/2014

Actual Use of Capital

2014

2013

Production Facilities, R&D and Production Equipment Cash flow generated from operations and issuance of corporate bonds

569,407,844

285,585,579

283,822,265

Others

Cash flow generated from operations

6,726,957

2,954,449

3,772,508

Total

 

576,134,801

288,540,028

287,594,773

Based on capital expenditures listed above and projected for 2015, it is estimated that TSMC’s annual production capacity will increase by approximately 1.06 million 12-inch equivalent wafers in 2015.

Long-term Investment Policy and Results

TSMC’s long-term investments, accounted for under the equity method, were all made for strategic purposes. However, when an investment is no longer of strategic value it may be considered a financial investment. In 2014, the investment gain from these investments amounted to NT$9,292,150 thousand (NT$3,949,674 thousand on a consolidated basis), mainly from the contribution of mobile computing products. For future investments, TSMC will continue to focus on strategic purposes through prudent assessments.