2Q20 outlook stable; company prioritizes medical related ICs shipments amid COVID-19

First Quarter 2020 Overview1:

  • Revenue: NT$42.27 billion (US$1.40 billion)
  • Gross margin: 19.2%
  • Foundry operating margin: 8.2%
  • Foundry capacity utilization rate: 93%
  • Net income attributable to stockholders of the parent: NT$2.21 billion (US$73 million)
  • Earnings per share: NT$0.19; earnings per ADS: US$0.031

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 2020.

First quarter consolidated revenue was NT$42.27 billion, up 1.0% QoQ from NT$41.85 billion in 4Q19 and up 29.7% YoY from NT$32.58 billion in 1Q19. Consolidated gross margin for 1Q20 was 19.2%. Net income attributable to the stockholders of the parent was NT$2.21 billion, with earnings per ordinary share of NT$0.19.

SC Chien, co-president of UMC, said, “In the first quarter, foundry revenue grew 1.0% QoQ to NT$42.27 billion, leading to a foundry operating margin of 8.2%. Utilization rate increased slightly to 93%, bringing wafer shipments to 2.15 million 8-inch equivalent wafers, primarily attributed to display driver demand in consumer and communication devices. The demand in consumer ICs partially reflected work-from-home initiatives adopted in many areas around the world to combat the spread of COVID-19. As this pandemic continues to impact populations across the globe, UMC has given priority to all wafer manufacturing of medical related ICs so that hospitals and care centers receive the equipment they need in the shortest time possible in order to deal with the coronavirus. We will continue to commit all resources within our means to accelerate the shipments of healthcare-related ICs in the universal fight against COVID-19.”

Co-president Chien further commented, “Looking into the second quarter of 2020, despite significantly higher levels of uncertainty caused by the COVID-19 pandemic, current outlook indicates slightly higher wafer demand, mainly supported by inventory replenishment across computer peripheral and consumer electronics end markets. We will continue to monitor market dynamics; meanwhile we anticipate a surge in the number of customer 28nm tape outs in the first half of 2020. While we strive to maintain the business momentum attained during the first quarter, UMC’s corporate strategy of delivering a high dividend payout ratio remains intact. In Q1, our Board of Directors proposed to distribute a cash dividend of approximately NT$0.75 per share, subject to shareholder approval during the annual shareholder meeting (AGM). We will also continue to strengthen our financial structure while gaining additional market share by executing on our technology development and corporate strategy. As the world navigates the COVID-19 situation, UMC is committed to the philosophy of “employee care, environmental focus and public service” while furthering sustainable development and corporate social responsibility. We will confront this challenge together with our employees, shareholders, and suppliers. We also deeply appreciate the efforts of all the front line professionals confronting this pandemic and will continue to support our communities in Taiwan and abroad.”

Summary of Operating Results

Operating Results

(Amount: NT$ million)

1Q20

4Q19

QoQ % change

1Q19

YoY % change

Operating Revenues

42,268

 

41,849

 

1.0

 

32,583

 

29.7

 

Gross Profit

8,122

 

6,968

 

16.6

 

2,262

 

259.1

 

Operating Expenses

(5,722

)

(6,165

)

(7.2

)

(4,932

)

16.0

 

Net Other Operating Income and Expenses

1,014

 

1,215

 

(16.5

)

1,073

 

(5.5

)

Operating Income (Loss)

3,414

 

2,018

 

69.2

 

(1,597

)

-

 

Net Non-Operating Income and Expenses

(2,592

)

946

 

-

 

1,247

 

-

 

Net Income Attributable to Stockholders of the Parent

2,207

 

3,837

 

(42.5

)

1,201

 

83.7

 

EPS (NT$ per share)

0.19

 

0.33

 

 

0.10

 

 

(US$ per ADS)

0.031

 

0.055

 

 

0.017

 

 

Operating revenues in 1Q20 increased 1.0% to NT$42.27 billion, including NT$42.27 billion from the foundry segment. Revenue contribution from 40nm and below technologies increased to 34%. Gross profit increased 16.6% quarterly to NT$8.12 billion, or 19.2% of revenue. Operating expenses declined 7.2% to NT$5.72 billion. Net other operating income declined 16.5% to NT$1.01 billion, leading to an operating income of NT$3.41 billion. Net non-operating expenses was NT$2.59 billion, including NT$1.97 billion in net investment loss. Net income attributable to stockholders of the parent was NT$2.21 billion.

Earnings per ordinary share for the quarter was NT$0.19. Earnings per ADS was US$0.031. The basic weighted average number of outstanding shares in 1Q20 was 11,782,936,260, compared with 11,708,869,140 shares in 4Q19 and 11,908,706,645 shares in 1Q19. The diluted weighted average number of outstanding shares was 13,087,825,472 in 1Q20, compared with 13,073,000,039 shares in 4Q19 and 13,238,181,278 shares in 1Q19. The fully diluted share count on March 31, 2020 was approximately 13,103,904,000.

Detailed Financials Section

COGS & Expenses

(Amount: NT$ million)

1Q20

4Q19

QoQ % change

1Q19

YoY % change

Operating Revenues

42,268

 

41,849

 

1.0

 

32,583

 

29.7

 

COGS

(34,146

)

(34,881

)

(2.1

)

(30,321

)

12.6

 

Depreciation

(11,124

)

(11,069

)

0.5

 

(10,497

)

6.0

 

Other Mfg. Costs

(23,022

)

(23,812

)

(3.3

)

(19,824

)

16.1

 

Gross Profit

8,122

 

6,968

 

16.6

 

2,262

 

259.1

 

Gross Margin (%)

19.2

%

16.7

%

 

6.9

%

 

Operating Expenses

(5,722

)

(6,165

)

(7.2

)

(4,932

)

16.0

 

G&A

(1,543

)

(1,603

)

(3.7

)

(1,236

)

24.8

 

Sales & Marketing

(1,040

)

(996

)

4.3

 

(889

)

17.0

 

R&D

(3,185

)

(3,453

)

(7.8

)

(2,807

)

13.5

 

Expected Credit Impairment Gain (Loss)

46

 

(113

)

-

 

-

 

100.0

 

Net Other Operating Income & Expenses

1,014

 

1,215

 

(16.5

)

1,073

 

(5.5

)

Operating Income (Loss)

3,414

 

2,018

 

69.2

 

(1,597

)

-

 

Operating revenues grew 1.0% QoQ to NT$42.27 billion. COGS declined 2.1% to NT$34.15 billion, as other manufacturing costs declined 3.3% to NT$23.02 billion due to flattish depreciation of NT$11.12 billion. Gross profit grew 16.6% to NT$8.12 billion. Operating expenses decreased 7.2% to NT$5.72 billion. R&D expenses fell 7.8% sequentially to NT$3.19 billion, representing 7.5% of 1Q20 operating revenues. Sales & Marketing expenses were up 4.3% to NT$1.04 billion. Net other operating income was NT$1.01 billion. In 1Q20, operating income totaled NT$3.41 billion.

Non-Operating Income and Expenses

(Amount: NT$ million)

1Q20

4Q19

1Q19

Non-Operating Income and Expenses

(2,592

)

946

 

1,247

 

Net Interest Income and Expenses

(368

)

(468

)

(473

)

Net Investment Gain and Loss

(1,974

)

1,064

 

1,228

 

Exchange Gain and Loss

(148

)

188

 

507

 

Other Gain and Loss

(102

)

162

 

(15

)

Net non-operating expenses in 1Q20 was NT$2.59 billion, resulting from NT$1.97 billion in net investment loss, NT$368 million in net interest expense and NT$148 million in exchange loss.

Cash Flow Summary

(Amount: NT$ million)

For the 3-Month Period Ended Mar. 31, 2020

For the 3-Month Period Ended Dec. 31, 2019

Cash Flow from Operating Activities

14,732

 

37,533

 

Net income before tax

822

 

2,964

 

Depreciation & Amortization

12,497

 

12,775

 

Expected credit impairment loss (gain)

(46

)

113

 

Share of loss (profit) of associates and joint ventures

847

 

(642

)

Income tax paid

(151

)

(52

)

Changes in working capital & others

763

 

22,375

 

Cash Flow from Investing Activities

(9,111

)

(17,844

)

Acquisition of subsidiaries

-

 

(12,801

)

Acquisition of PP&E

(3,631

)

(3,502

)

Acquisition of intangible assets

(453

)

(935

)

Increase in other financial assets

(5,114

)

-

 

Others

87

 

(606

)

Cash Flow from Financing Activities

(5,849

)

(9,716

)

Bank loans

(2,563

)

(9,551

)

Redemption of bonds

(2,500

)

-

 

Cash dividends

-

 

3

 

Others

(786

)

(168

)

Effect of Exchange Rate

(98

)

(1,238

)

Net Cash Flow

(326

)

8,735

 

Beginning balance

95,492

 

86,755

 

Changes in non-current assets held for sale

-

 

2

 

Ending balance

95,166

 

95,492

 

In 1Q20, cash inflow from operating activities was NT$14.73 billion. Cash outflow from investing activities totaled NT$9.11 billion, which included NT$3.96 billion in capital expenditure, resulting in free cash flow of NT$10.77 billion. Cash outflow from financing activities totaled NT$5.85 billion, primarily from NT$2.56 billion in the repayment of bank loans and NT$2.50 billion in redemption of bonds. Net cash outflow in 1Q20 was NT$326 million. Over the next 12 months, the company expects to repay NT$4.74 billion in bank loans.

Current Assets

(Amount: NT$ billion)

1Q20

4Q19

1Q19

Cash and Cash Equivalents

95.17

95.49

88.74

Notes & Accounts Receivable

28.57

25.73

22.99

Days Sales Outstanding

59

54

66

Inventories, net

22.13

21.72

18.87

Days of Inventory

59

55

56

Total Current Assets

159.60

153.76

146.80

Cash and cash equivalents decreased slightly to NT$95.17 billion. Days of inventory increased to 59 days.

Liabilities

(Amount: NT$ billion)

1Q20

4Q19

1Q19

Total Current Liabilities

61.10

 

72.71

 

52.64

 

Notes & Accounts Payable

8.92

 

8.88

 

6.78

 

Short-Term Credit / Bonds

25.35

 

36.81

 

23.35

 

Payables on Equipment

2.78

 

3.03

 

2.95

 

Other

24.05

 

23.99

 

19.56

 

Long-Term Credit / Bonds

47.75

 

47.89

 

64.98

 

Long-Term Investment Liabilities

19.89

 

20.09

 

20.99

 

Total Liabilities

149.64

 

162.97

 

164.32

 

Debt to Equity

71

%

79

%

78

%

Current liabilities declined to NT$61.10 billion. Total liabilities decreased to NT$149.64 billion, leading to a debt to equity ratio of 71%.

Analysis of Revenue2 for Foundry Segment

Revenue Breakdown by Region

Region

1Q20

4Q19

3Q19

2Q19

1Q19

North America

29

%

30

%

33

%

31

%

32

%

Asia Pacific

56

%

55

%

59

%

59

%

57

%

Europe

6

%

6

%

6

%

7

%

7

%

Japan

9

%

9

%

2

%

3

%

4

%

Revenue from Asia Pacific increased to 56%, while revenue contribution from North American customers declined to 29%. Revenue from Japan remained at 9% while European business stayed at 6%.

Revenue Breakdown by Geometry

Geometry

1Q20

4Q19

3Q19

2Q19

1Q19

14nm and below

0

%

0

%

0

%

0

%

0

%

14nm<x<=28nm

9

%

10

%

12

%

13

%

10

%

28nm<x<=40nm

25

%

22

%

26

%

24

%

20

%

40nm<x<=65nm

16

%

16

%

14

%

14

%

14

%

65nm<x<=90nm

15

%

18

%

12

%

12

%

12

%

90nm<x<=0.13um

11

%

11

%

11

%

14

%

15

%

0.13um<x<=0.18um

13

%

12

%

13

%

12

%

15

%

0.18um<x<=0.35um

8

%

8

%

9

%

8

%

11

%

0.5um and above

3

%

3

%

3

%

3

%

3

%

Revenue contribution from 28nm declined to 9% while 40nm business represented 25% of sales.

Revenue Breakdown by Customer Type

Customer Type

1Q20

4Q19

3Q19

2Q19

1Q19

Fabless

88

%

87

%

92

%

93

%

94

%

IDM

12

%

13

%

8

%

7

%

6

%

Revenue from fabless customers was 88% of revenue.

Revenue Breakdown by Application (1)

Application

1Q20

4Q19

3Q19

2Q19

1Q19

Computer

13%

13%

13%

14%

15%

Communication

54%

54%

54%

52%

48%

Consumer

24%

24%

26%

28%

29%

Others

9%

9%

7%

6%

8%

Revenue from communication remained flat at 54%, while business from consumer applications and computing peripherals remained unchanged at 24% and 13% respectively.

(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 1Q20 declined slightly.

(To view ASP trend, visit http://www.umc.com/english/investors/1Q20_ASP_trend.asp)

Shipment and Utilization Rate3 for Foundry Segment

Wafer Shipments

 

1Q20

4Q19

3Q19

2Q19

1Q19

Wafer Shipments (8” K equivalents)

2,148

 

2,042

 

1,806

 

1,730

 

1,611

 

 

Quarterly Capacity Utilization Rate

 

1Q20

4Q19

3Q19

2Q19

1Q19

Utilization Rate

93

%

92

%

91

%

88

%

83

%

Total Capacity (8” K equivalents)

2,278

 

2,237

 

2,004

 

1,970

 

1,937

 

In 1Q20, wafer shipments increased 5.2% QoQ to 2,148K, while quarterly capacity rose 1.8% QoQ to 2,278K. As a result, the overall utilization rate in 1Q20 was 93%.

Capacity4 for Foundry Segment

Total capacity in the first quarter reached 2,278K 8-inch equivalent wafers. We expect that second quarter capacity will grow to 2,291K 8-inch equivalent wafers, mainly reflecting the capacity de-bottlenecking efforts at Fab 12A, Fab 12i and Fab 8N.

Annual Capacity in thousands of wafers

 

Quarterly Capacity in thousands of wafers

FAB

Geometry (um)

2019

2018

2017

2016

 

FAB

2Q20E

1Q20

4Q19

3Q19

WTK

6"

3.5 – 0.45

370

 

396

 

422

 

423

 

 

WTK

93

92

93

93

Fab 8A

8"

0.5 – 0.25

825

 

825

 

825

 

827

 

 

Fab 8A

201

200

207

207

Fab 8C

8"

0.35 – 0.11

436

 

383

 

357

 

348

 

 

Fab 8C

113

112

111

111

Fab 8D

8"

0.13 – 0.09

359

 

347

 

341

 

342

 

 

Fab 8D

93

92

90

90

Fab 8E

8"

0.5 – 0.18

426

 

418

 

418

 

419

 

 

Fab 8E

113

112

111

107

Fab 8F

8"

0.18 – 0.11

434

 

431

 

417

 

401

 

 

Fab 8F

122

121

110

110

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

228

218

208

Fab 12A

12"

0.13 – 0.014

997

 

997

 

970

 

885

 

 

Fab 12A

261

260

250

250

Fab 12i

12"

0.13 – 0.040

595

 

555

 

537

 

584

 

 

Fab 12i

155

154

155

155

Fab 12X

12"

0.040 – 0.028

203

 

183

 

97

 

9

 

 

Fab 12X

53

52

51

51

Fab 12M

12"

0.090 – 0.040

98

 

-

 

-

 

-

 

 

Fab 12M

98

97

98

-

Total(1)

8,148

 

7,673

 

7,304

 

6,983

 

 

Total

2,291

2,278

2,237

2,004

YoY Growth Rate

6

%

5

%

5

%

6

%

 

 

 

 

 

 

(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

 

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 1Q20 was US$131 million. 2020 CAPEX is budgeted at US$1.0 billion.

Second Quarter of 2020 Outlook & Guidance

Quarter-over-Quarter Guidance:

  • Wafer Shipments: To increase by 1-2%
  • ASP in USD: To increase by 1-2%
  • Profitability: Gross profit margin will be approximately 20%
  • Foundry Segment Capacity Utilization: mid-90% range
  • 2020 CAPEX for Foundry Segment: US$1 billion

Recent Developments / Announcements

Mar 23, 2020

Faraday’s 28Gbps SerDes IP Now Available on UMC’s 28HPC Process

 

Feb 26, 2020

UMC Board of Directors Announces Proposals for its Annual Shareholders Meeting

 

Feb 5, 2020

UMC 4Q 2019 Financial Results

 

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

Conference Call / Webcast Announcement

Monday, April 27, 2020

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 1Q20 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 on 8" & 12" wafers 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 19,000 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 March 31, 2020

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

   

March 31, 2020

US$

NT$

%

Assets Current assets Cash and cash equivalents

3,148

 

95,166

 

26.4

%

Notes & Accounts receivable, net

945

 

28,569

 

7.9

%

Inventories, net

732

 

22,126

 

6.1

%

Other current assets

454

 

13,734

 

3.9

%

Total current assets

5,279

 

159,595

 

44.3

%

  Non-current assets Funds and investments

1,187

 

35,887

 

10.0

%

Property, plant and equipment

4,669

 

141,151

 

39.2

%

Right-of-use assets

265

 

7,998

 

2.2

%

Other non-current assets

524

 

15,826

 

4.3

%

Total non-current assets

6,645

 

200,862

 

55.7

%

Total assets

11,924

 

360,457

 

100.0

%

  Liabilities Current liabilities Short-term loans

312

 

9,432

 

2.6

%

Payables

912

 

27,584

 

7.7

%

Current portion of long-term liabilities

527

 

15,919

 

4.4

%

Other current liabilities

270

 

8,169

 

2.2

%

Total current liabilities

2,021

 

61,104

 

16.9

%

  Non-current liabilities Bonds payable

618

 

18,688

 

5.2

%

Long-term loans

961

 

29,059

 

8.1

%

Lease liabilities, noncurrent

171

 

5,170

 

1.4

%

Other non-current liabilities

1,179

 

35,616

 

9.9

%

Total non-current liabilities

2,929

 

88,533

 

24.6

%

Total liabilities

4,950

 

149,637

 

41.5

%

  Equity Equity attributable to the parent company Capital

4,043

 

122,224

 

33.9

%

Additional paid-in capital

1,368

 

41,345

 

11.5

%

Retained earnings, exchange differences on translation offoreign operations and unrealized gains or losses on financialassets measured at fair value through other comprehensiveincome

1,565

 

47,302

 

13.1

%

Treasury stock

(4

)

(120

)

(0.0

%)

Total equity attributable to the parent company

6,972

 

210,751

 

58.5

%

Non-controlling interests

2

 

69

 

0.0

%

Total equity

6,974

 

210,820

 

58.5

%

Total liabilities and equity

11,924

 

360,457

 

100.0

%

Note:New Taiwan Dollars have been translated into U.S. Dollars at the March 31, 2020 exchange rate of NT $30.23 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, 2020

March 31, 2019

Chg.

March 31, 2020

December 31, 2019

Chg.

US$ NT$ US$ NT$ % US$ NT$ US$ NT$ % Operating revenues

1,398

 

42,268

 

1,078

 

32,583

 

29.7

%

1,398

 

42,268

 

1,384

 

41,849

 

1.0

%

Operating costs

(1,129

)

(34,146

)

(1,003

)

(30,321

)

12.6

%

(1,129

)

(34,146

)

(1,154

)

(34,881

)

(2.1

%)

Gross profit

269

 

8,122

 

75

 

2,262

 

259.1

%

269

 

8,122

 

230

 

6,968

 

16.6

%

19.2

%

19.2

%

6.9

%

6.9

%

19.2

%

19.2

%

16.7

%

16.7

%

Operating expenses - Sales and marketing expenses

(34

)

(1,040

)

(29

)

(889

)

17.0

%

(34

)

(1,040

)

(33

)

(996

)

4.3

%

- General and administrative expenses

(52

)

(1,543

)

(41

)

(1,236

)

24.8

%

(52

)

(1,543

)

(53

)

(1,603

)

(3.7

%)

- Research and development expenses

(105

)

(3,185

)

(93

)

(2,807

)

13.5

%

(105

)

(3,185

)

(114

)

(3,453

)

(7.8

%)

- Expected credit impairment gain (loss)

2

 

46

 

-

 

-

 

100.0

%

2

 

46

 

(4

)

(113

)

-

 

Subtotal

(189

)

(5,722

)

(163

)

(4,932

)

16.0

%

(189

)

(5,722

)

(204

)

(6,165

)

(7.2

%)

Net other operating income and expenses

33

 

1,014

 

35

 

1,073

 

(5.5

%)

33

 

1,014

 

41

 

1,215

 

(16.5

%)

Operating income (loss)

113

 

3,414

 

(53

)

(1,597

)

-

 

113

 

3,414

 

67

 

2,018

 

69.2

%

8.1

%

8.1

%

(4.9

%)

(4.9

%)

8.1

%

8.1

%

4.8

%

4.8

%

  Net non-operating income and expenses

(86

)

(2,592

)

41

 

1,247

 

-

 

(86

)

(2,592

)

31

 

946

 

-

 

Income (loss) from continuing operationsbefore income tax

27

 

822

 

(12

)

(350

)

-

 

27

 

822

 

98

 

2,964

 

(72.3

%)

1.9

%

1.9

%

(1.1

%)

(1.1

%)

1.9

%

1.9

%

7.1

%

7.1

%

  Income tax benefit

14

 

408

 

15

 

443

 

(7.7

%)

14

 

408

 

6

 

191

 

113.9

%

Net income

41

 

1,230

 

3

 

93

 

1,228.5

%

41

 

1,230

 

104

 

3,155

 

(61.0

%)

2.9

%

2.9

%

0.3

%

0.3

%

2.9

%

2.9

%

7.5

%

7.5

%

  Other comprehensive income (loss)

(123

)

(3,714

)

120

 

3,614

 

-

 

(123

)

(3,714

)

(51

)

(1,538

)

141.5

%

  Total comprehensive income (loss)

(82

)

(2,484

)

123

 

3,707

 

-

 

(82

)

(2,484

)

53

 

1,617

 

-

 

  Net income attributable to:   Stockholders of the parent

73

 

2,207

 

40

 

1,201

 

83.7

%

73

 

2,207

 

127

 

3,837

 

(42.5

%)

  Non-controlling interests

(32

)

(977

)

(37

)

(1,108

)

(11.9

%)

(32

)

(977

)

(23

)

(682

)

43.3

%

  Comprehensive income (loss) attributable to:   Stockholders of the parent

(54

)

(1,634

)

159

 

4,813

 

-

 

(54

)

(1,634

)

76

 

2,291

 

-

 

  Non-controlling interests

(28

)

(850

)

(36

)

(1,106

)

(23.1

%)

(28

)

(850

)

(23

)

(674

)

26.2

%

  Earnings per share-basic

0.006

 

0.19

 

0.003

 

0.10

 

0.006

 

0.19

 

0.011

 

0.33

 

Earnings per ADS (2)

0.031

 

0.95

 

0.017

 

0.50

 

0.031

 

0.95

 

0.055

 

1.65

 

Weighted average number of shares outstanding (in millions)

11,783

 

11,909

 

11,783

 

11,709

 

Notes: (1) New Taiwan Dollars have been translated into U.S. Dollars at the March 31, 2020 exchange rate of NT $30.23 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, 2020

March 31, 2020

US$

NT$

%

US$

NT$

% Operating revenues

1,398

 

42,268

 

100.0

%

1,398

 

42,268

 

100.0

%

Operating costs

(1,129

)

(34,146

)

(80.8

%)

(1,129

)

(34,146

)

(80.8

%)

Gross profit

269

 

8,122

 

19.2

%

269

 

8,122

 

19.2

%

    Operating expenses - Sales and marketing expenses

(34

)

(1,040

)

(2.5

%)

(34

)

(1,040

)

(2.5

%)

- General and administrative expenses

(52

)

(1,543

)

(3.6

%)

(52

)

(1,543

)

(3.6

%)

- Research and development expenses

(105

)

(3,185

)

(7.5

%)

(105

)

(3,185

)

(7.5

%)

- Expected credit impairment gain

2

 

46

 

0.1

%

2

 

46

 

0.1

%

Subtotal

(189

)

(5,722

)

(13.5

%)

(189

)

(5,722

)

(13.5

%)

Net other operating income and expenses

33

 

1,014

 

2.4

%

33

 

1,014

 

2.4

%

Operating income

113

 

3,414

 

8.1

%

113

 

3,414

 

8.1

%

  Net non-operating income and expenses

(86

)

(2,592

)

(6.2

%)

(86

)

(2,592

)

(6.2

%)

Income from continuing operationsbefore income tax

27

 

822

 

1.9

%

27

 

822

 

1.9

%

    Income tax benefit

14

 

408

 

1.0

%

14

 

408

 

1.0

%

Net income

41

 

1,230

 

2.9

%

41

 

1,230

 

2.9

%

  Other comprehensive income (loss)

(123

)

(3,714

)

(8.8

%)

(123

)

(3,714

)

(8.8

%)

  Total comprehensive income (loss)

(82

)

(2,484

)

(5.9

%)

(82

)

(2,484

)

(5.9

%)

  Net income attributable to:   Stockholders of the parent

73

 

2,207

 

5.2

%

73

 

2,207

 

5.2

%

  Non-controlling interests

(32

)

(977

)

(2.3

%)

(32

)

(977

)

(2.3

%)

  Comprehensive income (loss) attributable to:   Stockholders of the parent

(54

)

(1,634

)

(3.9

%)

(54

)

(1,634

)

(3.9

%)

  Non-controlling interests

(28

)

(850

)

(2.0

%)

(28

)

(850

)

(2.0

%)

  Earnings per share-basic

0.006

 

0.19

 

0.006

 

0.19

 

Earnings per ADS (2)

0.031

 

0.95

 

0.031

 

0.95

 

  Weighted average number of sharesoutstanding (in millions)

11,783

 

11,783

 

Notes: (1) New Taiwan Dollars have been translated into U.S. Dollars at the March 31, 2020 exchange rate of NT $30.23 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, 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

27

 

822

 

Depreciation & Amortization

413

 

12,497

 

Share of loss of associates and joint ventures

28

 

847

 

Changes in working capital & others

19

 

566

 

Net cash provided by operating activities

487

 

14,732

 

  Cash flows from investing activities : Acquisition of property, plant and equipment

(120

)

(3,631

)

Acquisition of intangible assets

(15

)

(453

)

Increase in other financial assets

(169

)

(5,114

)

Others

3

 

87

 

Net cash used in investing activities

(301

)

(9,111

)

  Cash flows from financing activities : Decrease in short-term loans

(84

)

(2,544

)

Redemption of bonds

(83

)

(2,500

)

Proceeds from long-term loans

17

 

500

 

Repayments of long-term loans

(17

)

(519

)

Others

(26

)

(786

)

Net cash used in financing activities

(193

)

(5,849

)

  Effect of exchange rate changes on cash and cash equivalents

(4

)

(98

)

Net decrease in cash and cash equivalents

(11

)

(326

)

  Cash and cash equivalents at beginning of period

3,159

 

95,492

 

  Cash and cash equivalents at end of period

3,148

 

95,166

 

Note: New Taiwan Dollars have been translated into U.S. Dollars at the March 31, 2020 exchange rate of NT $30.23 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 March 31, 2020, the three-month period ending December 31, 2019, and the equivalent three-month period that ended March 31, 2019. For all 1Q20 results, New Taiwan Dollar (NT$) amounts have been converted into U.S. Dollars at the March 31, 2020 exchange rate of NT$ 30.23 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 Wong UMC, Investor Relations + 886-2-2658-9168, ext. 16900 jinhong_lin@umc.com david_wong@umc.com

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