UMC Reports First Quarter 2019 Results

Date : 04/24/2019 @ 10:20AM
Source : Business Wire
Stock : United Microelectronics Corp. (New) (UMC)
Quote : 2.12  0.0 (0.00%) @ 1:00AM

UMC Reports First Quarter 2019 Results

United Microelectron (NYSE:UMC)
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2 Months : From Apr 2019 to Jun 2019

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Company posts EPS of NT$0.10 in 1Q19;

Board of Directors approves 100% cash dividend payout to shareholders

First Quarter 2019 Overview1:

  • Revenue: NT$32.58 billion (US$1.06 billion)
  • Gross margin: 6.9%
  • Foundry revenue from 28nm: 10%; Foundry operating margin: -4.6%
  • Foundry capacity utilization rate: 83%
  • Net income to stockholders of the parent: NT$1.20 billion (US$39 million)
  • Earnings per share: NT$0.10; earnings per ADS: US$0.016

United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) (“UMC” or “The Company”), a leading global semiconductor foundry, today announced its consolidated operating results for the first quarter of 2019.

First quarter consolidated revenue was NT$32.58 billion, down 8.3% QoQ from NT$35.52 billion in 4Q18 and declined 13.1% YoY from NT$37.50 billion in 1Q18. Consolidated gross margin for 1Q19 was 6.9%. Net income attributable to stockholders of the parent was NT$1.20 billion, with earnings per ordinary share of NT$0.10.

Jason Wang, co-president of UMC, said, “In the first quarter, foundry revenue declined 8.3% QoQ to NT$32.56 billion, leading to a foundry operating loss of 4.6%. Utilization rate was 83%, bringing wafer shipments to 1.61 million 8-inch equivalent wafers. Although overall wafer demand declined during the first quarter, we observed stable wafer shipments from the wireless communications segment, solidified by smartphone related components such as display, RF, application processor and baseband modem. We continue to build on our promise of building shareholder value, and in Q1 our Board of Directors proposed to distribute a cash dividend of approximately NT$0.58 per share, subject to shareholder approval during the annual shareholder meeting (AGM).”

Co-president Wang further commented, “Entering the second quarter of 2019, UMC will sustain its energy on its continuing transformation, which will allow us to best take advantage of improving wafer demand within wired and wireless communication segments, with smartphones, networking, and display related products currently seeing better than expected conditions. Going forward, our strategy to stay focused on developing existing logic and specialty solutions across numerous technology platforms will help us enhance our market relevance to secure future business and expand our presence in the IC industry. We are confident that by continuing to responsibly execute our technology development, capacity expansion and customer service, we can bring optimal value to the company, its shareholders, and employees.”

Summary of Operating Results

Operating Results (Amount: NT$ million)   1Q19   4Q18   QoQ %change   1Q18   YoY %change Operating Revenues 32,583   35,517   (8.3)   37,497   (13.1) Gross Profit 2,262 4,601 (50.8) 4,642 (51.3) Operating Expenses (4,932) (6,396) (22.9) (4,850) 1.7 Net Other Operating Income and Expenses 1,073 1,206 (11.0) 977 9.8 Operating Income (Loss) (1,597) (589) 171.3 769 - Net Non-Operating Income and Expenses 1,247 (1,998) - 1,088 14.6

Net Income (Loss) Attributable to Stockholders of theParent

1,201 (1,707) - 3,400 (64.7)

EPS (NT$ per share)

0.10 (0.14) 0.28

(US$ per ADS)

0.016   (0.023)       0.045    

Operating revenues in 1Q19 declined 8.3% to NT$32.58 billion, including NT$32.56 billion from the foundry segment. Revenue contribution from 40nm and below technologies was 30%. Gross profit fell 50.8% to NT$2.26 billion, or 6.9% of revenue. Operating expenses declined 22.9% to NT$4.93 billion. Net other operating income was NT$1.07 billion, leading to an operating loss of NT$1.60 billion. Net non-operating income was NT$1.25 billion. Net income attributable to stockholders of the parent was NT$1.20 billion.

Earnings per ordinary share for the quarter was NT$0.10. Earnings per ADS was US$0.016. The basic weighted average number of outstanding shares in 1Q19 was 11,908,706,645, compared with 12,111,826,935 shares in 4Q18 and 12,202,773,078 shares in 1Q18. The diluted weighted average number of outstanding shares was 13,238,181,278 in 1Q19, compared with 12,111,826,935 shares in 4Q18 and 13,457,161,259 shares in 1Q18. The fully diluted share count on March 31, 2019 was approximately 13,453,794,000. On March 31, 2019, UMC held 200 million treasury shares acquired from the 17th share buy-back program.

Detailed Financials Section

COGS & Expenses (Amount: NT$ million)   1Q19   4Q18  

QoQ %change

  1Q18   YoY %change Operating Revenues   32,583   35,517   (8.3)   37,497   (13.1) COGS (30,321) (30,916) (1.9) (32,855) (7.7) Depreciation (10,497) (10,228) 2.6 (11,815) (11.2) Other Mfg. Costs (19,824) (20,688) (4.2) (21,040) (5.8) Gross Profit 2,262 4,601 (50.8) 4,642 (51.3) Gross Margin (%) 6.9% 13.0% 12.4% Operating Expenses (4,932) (6,396) (22.9) (4,850) 1.7 G&A (1,236) (1,339) (7.7) (1,017) 21.5 Sales & Marketing (889) (903) (1.6) (909) (2.2) R&D (2,807) (3,745) (25.0) (2,924) (4.0) Expected Credit Losses - (409) (100.0) - -

Net Other Operating

Income & Expenses

1,073 1,206 (11.0) 977 9.8

Operating Income(Loss)

  (1,597)   (589)   171.3   769   -

Operating revenues decreased 8.3% to NT$32.58 billion. COGS declined 1.9% to NT$30.32 billion, as depreciation increased 2.6% to NT$10.50 billion while other manufacturing costs declined 4.2% to NT$19.82 billion. Gross profit was NT$2.26 billion. Operating expenses declined 22.9% to NT$4.93 billion, which included a 25% decrease in R&D expense to NT$2.81 billion and a 7.7% decline in General and Administrative (G&A) expense. R&D expense represented 8.6% of 1Q19 operating revenues and net other operating income was NT$1.07 billion. Overall, the company realized an operating loss of NT$1.60 billion.

Non-Operating Income and Expenses (Amount: NT$ million)   1Q19   4Q18   1Q18 Non-Operating Income and Expenses   1,247   (1,998)   1,088 Net Interest Income and Expenses (473) (438) (529) Net Investment Gain and Loss 1,228 (1,859) 582 Exchange Gain and Loss 507 304 1,021 Other Gain and Loss   (15)   (5)   14

Net non-operating income in 1Q19 was NT$1.25 billion, primarily resulting from NT$1.23 billion in net investment gain and NT$507 million in exchange gain, partly offset by NT$473 million in net interest expense.

Cash Flow Summary

(Amount: NT$ million)  

For the 3-MonthPeriod EndedMar. 31, 2019

 

For the 3-MonthPeriod EndedDec. 31, 2018

Cash Flow from Operating Activities   8,183   12,123 Net loss before tax (350) (2,587) Depreciation & Amortization 12,380 12,414 Expected credit losses - 409

Net loss (gain) of financial assetsand liabilities at FVTPL

(1,032) 635

Share of profit or loss of associates andjoint ventures

(196) 1,148

Exchange gain on financial assetsand liabilities

(554) (68) Changes in working capital (1,339) 1,319 Interest paid (215) (905) Other (511) (242) Cash Flow from Investing Activities (5,683) (4,613) Acquisition of PP&E (5,563) (4,361) Acquisition of intangible assets (530) (292) Other 410 40 Cash Flow from Financing Activities 2,180 (5,724) Bank loans 2,463 (2,863) Treasury stock acquired (331) (3,019) Other 48 158 Effect of Exchange Rate 396 356 Net Cash Flow   5,076   2,142

Cash inflow from operating activities was NT$8.18 billion. CAPEX from foundry segment was NT$5.75 billion leading in free cash flow of NT$2.43 billion. Cash inflow from financing activities totaled NT$2.18 billion, including NT$2.46 billion cash inflow from bank loans and NT$331 million payment of treasury share buyback. Net cash inflow in 1Q19 was NT$5.08 billion. Over the next 12 months, the company expects to repay NT$1.56 billion in bank loans.

Current Assets (Amount: NT$ billion)   1Q19   4Q18   1Q18 Cash and Cash Equivalents   88.74   83.66   77.14 Notes & Accounts Receivable 22.99 23.88 25.01 Days Sales Outstanding 66 64 56 Inventories, net 18.87 18.20 17.14 Days of Inventory 56 53 49 Total Current Assets   146.80   141.19   136.42

Cash and cash equivalents increased to NT$88.74 billion. Days of inventory increased three days to 56 days.

Liabilities (Amount: NT$ billion)   1Q19   4Q18   1Q18 Total Current Liabilities   52.64   49.90   72.57 Notes & Accounts Payable 6.78 6.80 7.00 Short-Term Credit / Bonds 23.35 18.23 40.00 Payable on Equipment 2.95 4.01 2.97 Other 19.56 20.86 22.60 Long-Term Credit / Bonds 64.98 67.08 52.61 Long-Term Investment Liabilities 20.99 20.41 20.90 Total Liabilities 164.32 158.07 169.35 Debt to Equity   78%   77%   78%

Current liabilities increased to NT$52.64 billion. Total liabilities increased to NT$164.32 billion, leading to a debt to equity ratio of 78%.

Analysis of Revenue2 for Foundry Segment

Revenue Breakdown by Region Region   1Q19   4Q18   3Q18   2Q18   1Q18 North America   32%   38%   34%   37%   42% Asia Pacific   57%   51%   52%   51%   47% Europe   7%   8%   11%   9%   8% Japan   4%   3%   3%   3%   3%

Revenue from Asia Pacific increased to 57%, while contribution from North American customers declined to 32%. Revenue from Europe and Japan was 7% and 4%, respectively.

Revenue Breakdown by Geometry Geometry   1Q19   4Q18   3Q18   2Q18   1Q18 14nm and below   0%   1%   5%   3%   2% 14nm<x<=28nm   10%   10%   13%   15%   12% 28nm<x<=40nm   20%   23%   22%   26%   30% 40nm<x<=65nm   14%   13%   12%   12%   13% 65nm<x<=90nm   12%   11%   10%   7%   6% 90nm<x<=0.13um   15%   13%   11%   11%   11% 0.13um<x<=0.18um   15%   15%   14%   13%   13% 0.18um<x<=0.35um   11%   11%   10%   10%   10% 0.5um and above   3%   3%   3%   3%   3%

Revenue contribution from 28nm remained flat at 10% as 40nm business accounted for 20% of sales.

Revenue Breakdown by Customer Type Customer Type   1Q19   4Q18   3Q18   2Q18   1Q18 Fabless   94%   92%   93%   92%   92% IDM   6%   8%   7%   8%   8%

Revenue from fabless customers increased to 94% of revenue.

Revenue Breakdown by Application (1) Application   1Q19   4Q18   3Q18   2Q18   1Q18 Computer   15%   15%   19%   16%   14% Communication   48%   44%   43%   47%   47% Consumer   29%   30%   28%   28%   29% Others   8%   11%   10%   9%   10%

The communication segment increased to 48% of sales, while revenue from consumer applications was 29%. Computer related applications remained at 15% 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 1Q19 decreased slightly.

(To view ASP trend, visit http://www.umc.com/english/investors/1Q19_ASP_trend.asp)

Shipment and Utilization Rate3 for Foundry Segment

Wafer Shipments     1Q19   4Q18   3Q18   2Q18   1Q18 Wafer Shipments(8” K equivalents)   1,611   1,711   1,804   1,846   1,747   Quarterly Capacity Utilization Rate     1Q19   4Q18   3Q18   2Q18   1Q18 Utilization Rate   83%   88%   94%   97%   94% Total Capacity(8” K equivalents)   1,937   1,958   1,938   1,918   1,858

In 1Q19, wafer shipments decreased 5.8% to 1,611K. Quarterly capacity declined 1.1% QoQ to 1,937K, resulting in an overall utilization rate of 83%.

Capacity4 for Foundry Segment

Total capacity in the first quarter totaled 1,937K 8-inch equivalent wafers. We expect second quarter capacity to increase by approximately 2.7% QoQ to 1,989K 8-inch equivalent wafers, mainly attributed to the ongoing expansion efforts at HJ.

Annual Capacity in

thousands of wafers

    Quarterly Capacity in

thousands of wafers

FAB   Geometry(um)   2018   2017   2016   2015     FAB   2Q19E   1Q19   4Q18   3Q18 WTK   6"   3.5 – 0.45   396   422   423   421 WTK   93   91   93   93 Fab 8A   8"   0.5 – 0.25   825   825   827   813 Fab 8A   207   204   207   207 Fab 8C   8"   0.35 – 0.11   383   357   348   347 Fab 8C   109   106   108   92 Fab 8D   8"   0.13 – 0.09   347   341   342   341 Fab 8D   90   89   90   86 Fab 8E   8"   0.5 – 0.18   418   418   419   418 Fab 8E   105   103   105   105 Fab 8F   8"   0.18 – 0.11   431   417   401   388 Fab 8F   108   107   108   108 Fab 8S   8"   0.18 – 0.11   372   347   336   335 Fab 8S   93   92   93   93 HJ   8"   0.5 – 0.11   771   753   750   667 HJ   224   201   194   194 Fab 12A   12"   0.13 – 0.014   997   970   885   793 Fab 12A   250   246   250   250 Fab 12i   12"   0.13 – 0.040   555   537   584   572 Fab 12i   144   141   144   144 USCXM   12"   0.040 – 0.028   183   97   9   - USCXM   51   50   51   51 Total(1)   7,673   7,304   6,983   6,617 Total   1,989   1,937   1,958   1,938 YoY Growth Rate   5%   5%   6%   5%        

(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$1.0 billion

CAPEX spending in 1Q19 was US$186 million. Full year 2019 CAPEX is budgeted for US$1.0 billion.

Second Quarter of 2019 Outlook & Guidance

Quarter-over-Quarter Guidance:

  • Wafer Shipments: To increase by 6-7%
  • ASP in USD: To increase by 3%
  • Profitability: Gross profit margin will be in the low teens % range
  • Foundry Segment Capacity Utilization: mid-80% range
  • 2019 CAPEX for Foundry Segment: US$1.0 billion

Recent Developments / Announcements

Mar. 6, 2019

UMC Board of Directors Announces Proposals for its Annual Shareholders Meeting

Jan. 29, 2019

UMC 4Q 2018 Financial Results

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

Conference Call / Webcast Announcement

Wednesday, April 24, 2019

Time: 5:00 PM (Taipei) / 5:00 AM (New York) / 10:00 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 1Q19 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 that provides advanced IC production for 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 world-class 28nm High-K/Metal Gate technology, 14nm FinFET volume production, 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 11 wafer fabs are strategically located throughout Asia and are able to produce over 600,000 wafers per month. The company employs more than 20,000 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 March 31, 2019 Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)       March 31, 2019 US$ NT$ % Assets Current assets Cash and cash equivalents 2,880 88,738 23.7% Financial assets at fair value through profit or loss, current 18 552 0.2% Notes & Accounts receivable, net 746 22,992 6.1% Inventories, net 613 18,874 5.1% Other current assets 507 15,640 4.1% Total current assets 4,764 146,796 39.2%   Non-current assets Funds and investments 1,209 37,255 10.0% Property, plant and equipment 5,447 167,823 44.9% Right-of-use assets 277 8,548 2.3% Other non-current assets 446 13,716 3.6% Total non-current assets 7,379 227,342 60.8% Total assets 12,143 374,138 100.0%   Liabilities Current liabilities Short-term loans 545 16,798 4.5% Payables 728 22,417 6.0% Current portion of long-term liabilities 213 6,553 1.8% Other current liabilities 222 6,877 1.8% Total current liabilities 1,708 52,645 14.1%   Non-current liabilities Bonds payable 1,184 36,471 9.8% Long-term loans 925 28,505 7.6% Lease liabilities, noncurrent 180 5,539 1.5% Other non-current liabilities 1,336 41,164 10.9% Total non-current liabilities 3,625 111,679 29.8% Total liabilities 5,333 164,324 43.9%   Equity Equity attributable to the parent company Capital 3,935 121,243 32.4% Additional paid-in capital 1,304 40,164 10.8%

Retained earnings, exchange differences on translation offoreign operations, unrealized gains or losses on financial

assets measured at fair value through other comprehensiveincome and gains or losses on hedging Instruments

1,638 50,470 13.5% Treasury stock (82) (2,516) (0.7%) Total equity attributable to the parent company 6,795 209,361 56.0% Non-controlling interests 15 453 0.1% Total equity 6,810 209,814 56.1% Total liabilities and equity 12,143 374,138 100.0%                 Note:New Taiwan Dollars have been translated into U.S. Dollars at the March 31, 2019 exchange rate of NT $30.81 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 March 31, 2019 March 31, 2018 Chg. March 31, 2019 December 31, 2018 Chg. US$ NT$ US$ NT$ % US$ NT$ US$ NT$ % Operating revenues 1,058 32,583 1,217 37,497 (13.1%) 1,058 32,583 1,153 35,517 (8.3%) Operating costs (985) (30,321) (1,066) (32,855) (7.7%) (985) (30,321) (1,004) (30,916) (1.9%) Gross profit 73 2,262 151 4,642 (51.3%) 73 2,262 149 4,601 (50.8%) 6.9% 6.9% 12.4% 12.4% 6.9% 6.9% 13.0% 13.0% Operating expenses - Sales and marketing expenses (29) (889) (30) (909) (2.2%) (29) (889) (29) (903) (1.6%) - General and administrative expenses (40) (1,236) (33) (1,017) 21.5% (40) (1,236) (43) (1,339) (7.7%) - Research and development expenses (91) (2,807) (95) (2,924) (4.0%) (91) (2,807) (122) (3,745) (25.0%) - Expected credit losses - - - - - - - (13) (409) (100.0%) Subtotal (160) (4,932) (158) (4,850) 1.7% (160) (4,932) (207) (6,396) (22.9%) Net other operating income and expenses 35 1,073 32 977 9.8% 35 1,073 39 1,206 (11.0%) Operating income (loss) (52) (1,597) 25 769 - (52) (1,597) (19) (589) 171.3% (4.9%) (4.9%) 2.1% 2.1% (4.9%) (4.9%) (1.7%) (1.7%)   Net non-operating income and expenses 41 1,247 35 1,088 14.6% 41 1,247 (65) (1,998) -

Income (loss) from continuing operationsbefore income tax

 

(11) (350) 60 1,857 - (11) (350) (84) (2,587) (86.5%) (1.1%) (1.1%) 5.0% 5.0% (1.1%) (1.1%) (7.3%) (7.3%)   Income tax benefit (expense) 14 443 38 1,173 (62.3%) 14 443 (13) (413) - Net income (loss) 3 93 98 3,030 (96.9%) 3 93 (97) (3,000) - 0.3% 0.3% 8.1% 8.1% 0.3% 0.3% (8.4%) (8.4%)   Other comprehensive income (loss) 117 3,614 (7) (234) - 117 3,614 3 110 3,185.5%   Total comprehensive income (loss) 120 3,707 91 2,796 32.6% 120 3,707 (94) (2,890) -   Net income (loss) attributable to:   Stockholders of the parent 39 1,201 110 3,400 (64.7%) 39 1,201 (55) (1,707) -   Non-controlling interests (36) (1,108) (12) (370) 199.0% (36) (1,108) (42) (1,293) (14.3%)   Comprehensive income (loss) attributable to:   Stockholders of the parent 156 4,813 102 3,158 52.4% 156 4,813 (52) (1,608) -   Non-controlling interests (36) (1,106) (11) (362) 205.5% (36) (1,106) (42) (1,282) (13.7%)   Earnings per share-basic 0.003 0.10 0.009 0.28 0.003 0.10 (0.005) (0.14) Earnings per ADS (2) 0.016 0.50 0.045 1.40 0.016 0.50 (0.023) (0.70)

Weighted average number of sharesoutstanding (in millions)

11,909 12,203 11,909 12,112     Notes: (1) New Taiwan Dollars have been translated into U.S. Dollars at the March 31, 2019 exchange rate of NT $30.81 per U.S. Dollar. (2) 1 ADS equals 5 common shares.   UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES Consolidated Condensed Statements of Comprehensive Income Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$) Except Per Share and Per ADS Data           For the Three-Month Period Ended For the Three-Month Period Ended March 31, 2019 March 31, 2019 US$ NT$ % US$ NT$ % Operating revenues 1,058 32,583 100.0% 1,058 32,583 100.0% Operating costs (985) (30,321) (93.1%) (985) (30,321) (93.1%) Gross profit 73 2,262 6.9% 73 2,262 6.9%     Operating expenses - Sales and marketing expenses (29) (889) (2.7%) (29) (889) (2.7%) - General and administrative expenses (40) (1,236) (3.8%) (40) (1,236) (3.8%) - Research and development expenses (91) (2,807) (8.6%) (91) (2,807) (8.6%) Subtotal (160) (4,932) (15.1%) (160) (4,932) (15.1%) Net other operating income and expenses 35 1,073 3.3% 35 1,073 3.3% Operating loss (52) (1,597) (4.9%) (52) (1,597) (4.9%)   Net non-operating income and expenses 41 1,247 3.8% 41 1,247 3.8% Loss from continuing operations

before income tax

(11) (350) (1.1%) (11) (350) (1.1%)     Income tax benefit 14 443 1.4% 14 443 1.4% Net income 3 93 0.3% 3 93 0.3%   Other comprehensive income (loss) 117 3,614 11.1% 117 3,614 11.1%   Total comprehensive income (loss) 120 3,707 11.4% 120 3,707 11.4%   Net income (loss) attributable to:   Stockholders of the parent 39 1,201 3.7% 39 1,201 3.7%   Non-controlling interests (36) (1,108) (3.4%) (36) (1,108) (3.4%)   Comprehensive income (loss) attributable to:   Stockholders of the parent 156 4,813 14.8% 156 4,813 14.8%   Non-controlling interests (36) (1,106) (3.4%) (36) (1,106) (3.4%)   Earnings per share-basic 0.003 0.10 0.003 0.10 Earnings per ADS (2) 0.016 0.50 0.016 0.50   Weighted average number of shares

outstanding (in millions)

11,909 11,909                           Notes: (1) New Taiwan Dollars have been translated into U.S. Dollars at the March 31, 2019 exchange rate of NT $30.81 per U.S. Dollar. (2) 1 ADS equals 5 common shares.   UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES Consolidated Condensed Statement of Cash Flows For The Three-Month Period Ended March 31, 2019 Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)   US$ NT$ Cash flows from operating activities : Net loss before tax (11) (350) Depreciation & Amortization 402 12,380 Net gain of financial assets and liabilities at fair value through profit or loss (33) (1,032) Exchange gain on financial assets and liabilities (18) (554) Changes in notes & accounts receivable 27 831 Changes in other payables (33) (1,020) Changes in assets, liabilities and others (68) (2,072) Net cash provided by operating activities 266 8,183   Cash flows from investing activities : Acquisition of property, plant and equipment (181) (5,563) Acquisition of intangible assets (17) (530) Others 14 410 Net cash used in investing activities (184) (5,683)   Cash flows from financing activities : Increase in short-term loans 113 3,467 Proceeds from long-term loans 24 748 Repayments of long-term loans (57) (1,752) Treasury stock acquired (11) (331) Others 2 48 Net cash provided by financing activities 71 2,180   Effect of exchange rate changes on cash and cash equivalents 12 396 Net increase in cash and cash equivalents 165 5,076   Cash and cash equivalents at beginning of period 2,715 83,662   Cash and cash equivalents at end of period 2,880 88,738           Note: New Taiwan Dollars have been translated into U.S. Dollars at the March 31, 2019 exchange rate of NT $30.81 per U.S. Dollar.  

1 Unless 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 March 31, 2019, the three-month period ending December 31, 2018, and the equivalent three-month period that ended March 31, 2018. For all 1Q19 results, New Taiwan Dollar (NT$) amounts have been converted into U.S. Dollars at the March 31, 2019 exchange rate of NT$ 30.81 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.

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

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