Science-Based Industrial Park, Hsin-Chu, Taiwan, July 27, 1999 - Taiwan Semiconductor Manufacturing Company Ltd. (TAIEX: 2330, NYSE: TSM), ("TSMC" or the "Company") announced today its audited financial results for the second quarter of 1999. Net sales for the second quarter of 1999 amounted to NT$17,232 million, net income totaled NT$6,022 million, and earnings per share were NT$0.8 based on the current 7,548 million shares outstanding. For the six months ended June 30, 1999, net sales were NT$29,733 million and net income was NT$10,112 million. With a total of 7,548 million shares outstanding, earnings per share for the first half-year of 1999 were NT$1.34.
Mr. YC Huang, Spokesman for TSMC, explained that since WaferTech's orders are all provided by TSMC and sales revenues are all collected through TSMC, the Company decided to adopt a new accounting method to depict the real situation. Starting in May, 1999, TSMC recognizes 100% of WaferTech's revenue, instead of accounting only the sales commission from WaferTech, which was the case until April, 1999. WaferTech's total sales revenue of NT$1,416 million for the six months ended June 30, 1999, are included in TSMC's income statement for the second quarter of 1999, while the first quarter income statement will not be restated using the new method. Mr. Huang stated that under the new accounting method, sales revenues are higher and gross margins are lower, while net impact on TSMC's net income and EPS is none.
Mr. YC Huang pointed out that as a result of continued growth in the IC market, the Company's capacity was fully utilized in the second quarter of 1999. The unit shipment of 8-inch equivalent wafers (including WaferTech) reached a record high of 422 thousand units in the second quarter this year. In terms of sales breakdown by techonlogy, wafers using 0.25um or more advanced technology accounted for 21% of total billing in the second quarter compared to no shipment in the same period of 1998. In addition, investment loss decreased significantly due to better operating results of some of the TSMC affiliates. In summary, net income for the second quarter of 1999 rose 60.3% and net sales increased 48.5% over the same period of 1998.
On a sequential basis, net sales and net income for the second quarter of 1999 increased 37.9% and 47.3%, respectively, over the first quarter of 1999.