3Q22 operating income doubles YoY; 22/28 revenue contribution reaches 25%

Third Quarter 2022 Overview1:

  • Revenue: NT$75.39 billion (US$2.38 billion)
  • Gross margin: 47.3%; Operating margin: 40.0%
  • Revenue from 22/28nm: 25%
  • Capacity utilization rate: 100%+
  • Net income attributable to shareholders of the parent: NT$27 billion (US$851 million)
  • Earnings per share: NT$2.19; earnings per ADS: US$0.345

United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) (“UMC” or “The Company”), a leading global semiconductor foundry, today announced its consolidated operating results for the third quarter of 2022.

Third quarter consolidated revenue was NT$75.39 billion, increasing 4.6% QoQ from NT$72.06 billion in 2Q22. Compared to a year ago, 3Q22 revenue grew 34.9% YoY from NT$55.91 billion in 3Q21. Consolidated gross margin for 3Q22 reached 47.3%. Net income attributable to the shareholders of the parent was NT$27 billion, with earnings per ordinary share of NT$2.19.

Jason Wang, co-president of UMC, said, “In the third quarter, our results benefited from product mix optimization and a more favorable exchange rate, while fab capacity remained fully utilized. Despite softening demand in consumer end markets, strengths in certain wireless communications areas drove further expansion in our 22/28nm business, which accounted for 25% of overall third-quarter revenue and lifted wafer average selling price. We believe our industry-leading position in OLED display driver ICs will continue to drive growth for our 22/28nm technologies amid growing adoption of OLED panels in smartphones and other end devices. We also saw sustained momentum in our automotive business during the quarter, and we intend to pursue more collaboration opportunities with existing and potential automotive customers.”

Co-president Wang said, “Moving into the fourth quarter, we expect to face headwinds amid demand weakness, impacted by factors including the inflationary environment and Ukraine war. While UMC will not be immune to the inventory correction affecting the industry, we will work closely with our customers as they adjust to current market conditions. At the same time, we will continue to deliver differentiated technology processes to enable customers’ product pipelines. We have revised the company’s 2022 capital expenditure down to US$3 billion, but our capacity expansions in Tainan and Singapore are still progressing as planned in order to meet long-term supply commitments. Despite near-term turbulences, the structural story of increasing silicon content driven by the rise of 5G, AIoT, and EV remains intact. With our comprehensive technology offering, focus on manufacturing excellence, and resilient financial structure, UMC will further increase our exposure to strong growth markets and consolidate our specialty technology leadership.”

Co-president Wang added, “In terms of corporate sustainability, UMC made steady progress towards our goals across all three areas of ESG. Going into 2023, we will accelerate carbon emissions reduction efforts by proactively seeking ways to lower emissions associated with wafer manufacturing and products footprint, working with partners to address emissions from the value chain, as well as investing in net-zero technologies as we strive for net zero by 2050.”

Summary of Operating Results

Operating Results

(Amount: NT$ million)

3Q22

 

2Q22

 

QoQ % change

3Q21

 

YoY % change

Operating Revenues

75,392

 

72,055

 

4.6

 

55,907

 

34.9

 

Gross Profit

35,664

 

33,472

 

6.5

 

20,544

 

73.6

 

Operating Expenses

(6,794

)

(6,706

)

1.3

 

(6,636

)

2.4

 

Net Other Operating Income and Expenses

1,287

 

1,398

 

(8.0

)

1,227

 

4.9

 

Operating Income

30,157

 

28,164

 

7.1

 

15,135

 

99.3

 

Net Non-Operating Income and Expenses

2,189

 

(2,586

)

-

 

4,317

 

(49.3

)

Net Income Attributable to Shareholders of the Parent

26,996

 

21,327

 

26.6

 

17,460

 

54.6

 

EPS (NT$ per share)

2.19

 

1.74

 

 

1.43

 

 

        (US$ per ADS)

0.345

 

0.274

 

 

0.225

 

 

Third quarter operating revenues increased by 4.6% sequentially to NT$75.39 billion which was partially lifted due to a better product mix as well as favorable foreign exchange rate. Revenue contribution from 40nm and below technologies represented 42% of wafer revenue. Gross profit grew 6.5% QoQ to NT$35.66 billion, or 47.3% of revenue. Operating expenses grew 1.3% to NT$6.79 billion. Net other operating income declined to NT$1.29 billion. Net non-operating income totaled NT$2.19 billion. Net income attributable to shareholders of the parent amounted to NT$27 billion.

Earnings per ordinary share for the quarter was NT$2.19. Earnings per ADS was US$0.345. The basic weighted average number of outstanding shares in 3Q22 was 12,305,516,644, compared with 12,283,479,334 shares in 2Q22 and 12,206,292,756 shares in 3Q21. The diluted weighted average number of outstanding shares was 12,635,661,561 in 3Q22, compared with 12,553,373,552 shares in 2Q22 and 12,411,100,649 shares in 3Q21. The fully diluted shares counted on September 30, 2022 were approximately 12,679,025,000.

Detailed Financials Section

Operating revenues increased to NT$75.39 billion. COGS increased 3.0% to NT$39.73 billion, which included 3.9% sequential increase in other manufacturing costs. Gross profit grew 6.5% QoQ to NT$35.66 billion. Operating expenses increased 1.3% QoQ to NT$6.79 billion, as Sales & Marketing grew 15.9% to NT$1.06 billion while R&D was up 3.0% QoQ to NT$3.30 billion, representing 4.4% of revenue. Net other operating income was NT$1.29 billion. In 3Q22, operating income grew 7.1% QoQ to NT$30.16 billion.

COGS & Expenses

(Amount: NT$ million)

 

3Q22

 

2Q22

 

QoQ % change

 

3Q21

 

YoY % change

Operating Revenues

 

75,392

 

72,055

 

4.6

 

55,907

 

34.9

COGS

 

(39,728)

 

(38,583)

 

3.0

 

(35,363)

 

12.3

Depreciation

 

(9,622)

 

(9,616)

 

0.1

 

(9,900)

 

(2.8)

Other Mfg. Costs

 

(30,106)

 

(28,967)

 

3.9

 

(25,463)

 

18.2

Gross Profit

 

35,664

 

33,472

 

6.5

 

20,544

 

73.6

Gross Margin (%)

 

47.3%

 

46.5%

 

 

 

36.8%

 

 

Operating Expenses

 

(6,794)

 

(6,706)

 

1.3

 

(6,636)

 

2.4

G&A

 

(2,428)

 

(2,579)

 

(5.9)

 

(2,119)

 

14.6

Sales & Marketing

 

(1,061)

 

(915)

 

15.9

 

(1,212)

 

(12.5)

R&D

 

(3,304)

 

(3,209)

 

3.0

 

(3,303)

 

0.0

Expected Credit Impairment Loss

 

(1)

 

(3)

 

(75.8)

 

(2)

 

(68.6)

Net Other Operating Income & Expenses

 

1,287

 

1,398

 

(8.0)

 

1,227

 

4.9

Operating Income

 

30,157

 

28,164

 

7.1

 

15,135

 

99.3

Net non-operating income in 3Q22 was NT$2.19 billion, primarily reflecting NT$1.29 billion in exchange gain and a NT$0.78 billion in net investment gain.

Non-Operating Income and Expenses

(Amount: NT$ million)

 

3Q22

 

2Q22

 

3Q21

Non-Operating Income and Expenses

 

2,189

 

(2,586)

 

4,317

Net Interest Income and Expenses

 

139

 

(163)

 

(367)

Net Investment Gain and Loss

 

780

 

(3,675)

 

4,534

Exchange Gain and Loss

 

1,293

 

1,361

 

164

Other Gain and Loss

 

(23)

 

(109)

 

(14)

In 3Q22, cash inflow from operating activities was NT$39.70 billion. Cash outflow from investing activities amounted to NT$21.42 billion, which included NT$23.13 billion in capital expenditure, resulting in free cash flow of NT$16.56 billion. Cash outflow from financing reached NT$26.69 billion, primarily from a NT$37.45 billion payment as cash distributed from additional paid- in capital partially offset by a NT$14.44 billion from the increase in deposits-in. Net cash outflow in 3Q22 totaled NT$3.07 billion. Over the next 12 months, the company expects to repay NT$ 4.43 billion in bank loans.

Cash Flow Summary

(Amount: NT$ million)

 

For the 3-Month Period Ended

Sep.30, 2022

 

For the 3-Month Period Ended Jun. 30, 2022

Cash Flow from Operating Activities

 

39,696

 

 

35,091

 

Net income before tax

 

32,346

 

 

25,578

 

Depreciation & Amortization

 

11,195

 

 

11,107

 

Share of loss (profit) of associates and

joint ventures

 

(328

)

 

2,027

 

Income tax paid

 

(652

)

 

(2,913

)

Changes in working capital & others

 

(2,865

)

 

(708

)

Cash Flow from Investing Activities

 

(21,419

)

 

(11,716

)

Decrease in financial assets measured

at amortized cost

 

2,070

 

 

103

 

Acquisition of PP&E

 

(22,466

)

 

(10,907

)

Acquisition of intangible assets

 

(1,080

)

 

(815

)

Others

 

57

 

 

(97

)

Cash Flow from Financing Activities

 

(26,688

)

 

(13,423

)

Bank loans

 

(473

)

 

(11,615

)

Redemption of bonds

 

(1,031

)

 

(2,484

)

Increase in deposits-in

 

14,441

 

 

864

 

Cash distributed from additional paid- in capital

 

(37,446

)

 

-

 

Others

 

(2,179

)

 

(188

)

Effect of Exchange Rate

 

5,337

 

 

1,601

 

Net Cash Flow

 

(3,074

)

 

11,553

 

Beginning balance

 

183,723

 

 

172,170

 

Ending balance

 

180,649

 

 

183,723

Cash and cash equivalents slightly decreased to NT$180.65 billion. Days of inventory increased by 4 days to 66 days.

Current Assets

(Amount: NT$ billion)

 

3Q22

 

2Q22

 

3Q21

Cash and Cash Equivalents

 

180.65

 

183.72

 

113.11

Notes & Accounts Receivable

 

44.84

 

42.88

 

32.99

Days Sales Outstanding

 

53

 

51

 

51

Inventories, net

 

30.10

 

27.34

 

23.15

Days of Inventory

 

66

 

62

 

59

Total Current Assets

 

266.95

 

265.78

 

211.60

Current liabilities decreased to NT$108.01 billion, mainly from the reduction of in other as company distributed cash from additional paid-in capital to shareholders during Q3. Long-term credit/bonds increased to NT$46.15 billion. Total liabilities decreased to NT$204.21 billion, leading to a debt to equity ratio of 65%.

Liabilities

(Amount: NT$ billion)

 

3Q22

2Q22

 

3Q21

Total Current Liabilities

 

108.01

 

 

131.81

 

 

84.55

 

Notes & Accounts Payable

 

10.04

 

 

9.95

 

 

8.26

 

Short-Term Credit / Bonds

 

12.19

 

 

13.22

 

 

24.26

 

Payables on Equipment

 

19.40

 

 

11.60

 

 

6.72

 

Other

 

66.38

 

 

97.04

 

 

45.31

 

Long-Term Credit / Bonds

 

46.15

 

 

45.70

 

 

51.09

 

Long-Term Investment Liabilities

 

4.26

 

 

8.50

 

 

8.14

 

Total Liabilities

 

204.21

 

 

216.51

 

 

171.19

 

Debt to Equity

 

65

%

 

76

%

 

66

%

Analysis of Revenue2

Revenue from Asia-Pacific declined to 62% while business from North America was 23% of sales. Business from Europe was 9% while contribution from Japan increased to 6%.

Revenue Breakdown by Region

Region

 

3Q22

 

 

2Q22

 

 

1Q22

 

 

4Q21

 

 

3Q21

 

North America

 

23

%

 

22

%

 

22

%

 

21

%

 

22

%

Asia Pacific

 

62

%

 

65

%

 

64

%

 

66

%

 

65

%

Europe

 

9

%

 

8

%

 

8

%

 

7

%

 

7

%

Japan

 

6

%

 

5

%

 

6

%

 

6

%

 

6

%

Revenue contribution from 22/28nm grew to 25% of the wafer revenue, while 40nm contribution was 17% of sales.

Revenue Breakdown by Geometry

Geometry

 

3Q22

 

 

2Q22

 

 

1Q22

 

 

4Q21

 

 

3Q21

 

14nm and below

 

0

%

 

0

%

 

0

%

 

0

%

 

0

%

14nm<x<=28nm

 

25

%

 

22

%

 

20

%

 

20

%

 

19

%

28nm<x<=40nm

 

17

%

 

18

%

 

18

%

 

18

%

 

18

%

40nm<x<=65nm

 

18

%

 

19

%

 

19

%

 

19

%

 

19

%

65nm<x<=90nm

 

8

%

 

7

%

 

8

%

 

8

%

 

8

%

90nm<x<=0.13um

 

12

%

 

12

%

 

12

%

 

12

%

 

12

%

0.13um<x<=0.18um

 

10

%

 

12

%

 

13

%

 

13

%

 

13

%

0.18um<x<=0.35um

 

8

%

 

8

%

 

7

%

 

7

%

 

8

%

0.5um and above

 

2

%

 

2

%

 

3

%

 

3

%

 

3

%

Revenue from fabless customers accounted for 83% of revenue.

Revenue Breakdown by Customer Type

Customer Type

 

3Q22

 

 

2Q22

 

 

1Q22

 

 

4Q21

 

 

3Q21

 

Fabless

 

83

%

 

86

%

 

87

%

 

86

%

 

86

%

IDM

 

17

%

 

14

%

 

13

%

 

14

%

 

14

%

Revenue from the communication segment represented 45%, while business from computer applications decreased to 14%. Business from consumer applications was 27% as other segments increased to 14% of revenue.

Revenue Breakdown by Application (1)

Application

 

3Q22

 

 

2Q22

 

 

1Q22

 

 

4Q21

 

 

3Q21

 

Computer

 

14

%

 

16

%

 

17

%

 

17

%

 

17

%

Communication

 

45

%

 

45

%

 

45

%

 

46

%

 

46

%

Consumer

 

27

%

 

27

%

 

26

%

 

26

%

 

27

%

Others

 

14

%

 

12

%

 

12

%

 

11

%

 

10

%

(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, WLAN. Communication consists of handset components, broadband, 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

Blended average selling price (ASP) grew in 3Q22.

(To view blended ASP trend, please click here for 3Q22 ASP)

Shipment and Utilization Rate3

Wafer shipments decreased 1% QoQ to 2,597K in the third quarter, while quarterly capacity grew to 2,539K. Overall utilization rate in 3Q22 remained above 100%.

Wafer Shipments

 

3Q22

2Q22

1Q22

4Q21

3Q21

Wafer Shipments (8” K equivalents)

2,597

2,622

2,513

2,546

2,503

 

Quarterly Capacity Utilization Rate

 

3Q22

2Q22

1Q22

4Q21

3Q21

Utilization Rate

100%+

100%+

100%+

100%+

100%+

Total Capacity (8” K equivalents)

2,539

2,528

2,420

2,419

2,383

Capacity4

Overall capacity in the third quarter increased to 2,539K 8-inch equivalent wafers. Capacity will grow in the fourth quarter of 2022 to 2,543K 8-inch equivalent wafers, reflecting the capacity expansion taking place at 8N.

Annual Capacity in thousands of wafers

 

 

Quarterly Capacity in thousands of wafers

FAB

Geometry (um)

2021

2020

2019

2018

 

 

FAB

4Q22E

3Q22

2Q22

1Q22

WTK

6"

 

5 – 0.15

 

329

 

371

 

370

 

396

 

 

WTK

 

6"

 

85

 

85

 

84

 

82

8A

8"

 

3 – 0.11

 

755

 

802

 

825

 

825

 

 

8A

 

8"

 

192

 

192

 

192

 

189

8C

8"

 

0.35 – 0.11

 

459

 

452

 

436

 

383

 

 

8C

 

8"

 

115

 

115

 

115

 

113

8D

8"

 

0.18 – 0.09

 

380

 

371

 

359

 

347

 

 

8D

 

8"

 

103

 

103

 

103

 

101

8E

8"

 

0.6 – 0.14

 

457

 

449

 

426

 

418

 

 

8E

 

8"

 

118

 

118

 

118

 

116

8F

8"

 

0.18 – 0.11

 

514

 

485

 

434

 

431

 

 

8F

 

8"

 

138

 

138

 

138

 

136

8S

8"

 

0.18 – 0.11

 

408

 

373

 

372

 

372

 

 

8S

 

8"

 

111

 

111

 

111

 

109

8N

8"

 

0.5 – 0.11

 

917

 

917

 

831

 

771

 

 

8N

 

8"

 

245

 

242

 

235

 

231

12A

12"

 

0.13 – 0.014

 

1,070

 

1,044

 

997

 

997

 

 

12A

 

12"

 

301

 

301

 

301

 

267

12i

12"

 

0.13 – 0.040

 

641

 

628

 

595

 

555

 

 

12i

 

12"

 

164

 

164

 

164

 

162

12X

12"

 

0.080 – 0.022

 

284

 

217

 

203

 

183

 

 

12X

 

12"

 

80

 

80

 

78

 

77

12M

12"

 

0.13 – 0.040

 

395

 

391

 

98

 

-

 

 

12M

 

12"

 

110

 

110

 

110

 

108

Total(1)

 

9,453

 

9,188

 

8,148

 

7,673

 

 

Total

 

2,543

 

2,539

 

2,528

 

2,420

YoY Growth Rate

 

3%

 

13%

 

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. Total capacity figures are expressed in 8-inch equivalent wafers.

CAPEX

CAPEX spending in 3Q22 totaled US$764 million. 2022 cash-based CAPEX budget will be US$3.0 billion.

Capital Expenditure by Year - in US$ billion

Year

2021

2020

2019

2018

2017

CAPEX

 

$ 1.8

 

$ 1.0

 

$ 0.6

 

$ 0.7

 

$ 1.4

2022 CAPEX Plan

8"

12"

Total

10%

 

90%

 

US$3.0 billion

Fourth Quarter 2022 Outlook & Guidance

Quarter-over-Quarter Guidance:

  • Wafer Shipments: To decrease by approximately 10%
  • ASP in USD: To remain flat
  • Gross Profit Margin: Will be in the low-40% range
  • Capacity Utilization: 90%
  • 2022 CAPEX: US$3.0 billion

Recent Developments / Announcements

Aug. 24, 2022

UMC and Cadence Collaborate on Analog/Mixed-Signal Flow for 22ULP/ULL Process Technologies

Sep. 13, 2022

Avalanche Technology and UMC Announce 22nm Production of High-Density MRAM-Based Devices for Aerospace Applications

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

Conference Call / Webcast Announcement

Wednesday, October 26, 2022

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 3Q22 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 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 approximately 850,000 8-inch equivalent wafers per month. The company employs approximately 20,000 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 financial results for the third quarter of 2022; the expected wafer shipment and ASP; the anticipated annual budget; capex strategies; environmental protection goals and water management strategies; impact of foreign currency exchange rates; expected foundry capacities; the ability to obtain new business opportunities; and information under the heading “Third Quarter of 2022 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 risk factors 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 September 30, 2022 Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)    

September 30, 2022

US$

NT$

%

Assets Current assets Cash and cash equivalents

5,692

180,649

34.8

%

Accounts receivable, net

1,413

44,842

8.6

%

Inventories, net

948

30,102

5.8

%

Other current assets

357

11,352

2.2

%

Total current assets

8,410

266,945

51.4

%

  Non-current assets Funds and investments

1,951

61,938

11.9

%

Property, plant and equipment

4,698

149,119

28.7

%

Right-of-use assets

249

7,903

1.5

%

Other non-current assets

1,056

33,489

6.5

%

Total non-current assets

7,954

252,449

48.6

%

Total assets

16,364

519,394

100.0

%

  Liabilities Current liabilities Short-term loans

7

217

0.0

%

Payables

2,155

68,415

13.2

%

Current portion of long-term liabilities

377

11,975

2.3

%

Other current liabilities

864

27,402

5.3

%

Total current liabilities

3,403

108,009

20.8

%

  Non-current liabilities Bonds payable

727

23,082

4.4

%

Long-term loans

727

23,063

4.4

%

Lease liabilities, noncurrent

166

5,284

1.0

%

Other non-current liabilities

1,411

44,767

8.7

%

Total non-current liabilities

3,031

96,196

18.5

%

Total liabilities

6,434

204,205

39.3

%

  Equity Equity attributable to the parent company Capital

3,933

124,821

24.0

%

Additional paid-in capital

336

10,668

2.1

%

Retained earnings and other components of equity

5,649

179,321

34.5

%

Total equity attributable to the parent company

9,918

314,810

60.6

%

Non-controlling interests

12

379

0.1

%

Total equity

9,930

315,189

60.7

%

Total liabilities and equity

16,364

519,394

100.0

%

  Note:New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2022 exchange rate of NT $31.74 per U.S. Dollar. UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES Consolidated Condensed Statements of Comprehensive Income Figures in Millions of New Taiwan Dollars (NT$) 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

September 30, 2022

September 30, 2021

Chg.

September 30, 2022

June 30, 2022

Chg.

US$

NT$

US$

NT$

%

US$

NT$

US$

NT$

%

Operating revenues

2,375

 

75,392

 

1,761

 

55,907

 

34.9

%

2,375

 

75,392

 

2,270

 

72,055

 

4.6

%

Operating costs

(1,251

)

(39,728

)

(1,114

)

(35,363

)

12.3

%

(1,251

)

(39,728

)

(1,215

)

(38,583

)

3.0

%

Gross profit

1,124

 

35,664

 

647

 

20,544

 

73.6

%

1,124

 

35,664

 

1,055

 

33,472

 

6.5

%

47.3

%

47.3

%

36.8

%

36.8

%

47.3

%

47.3

%

46.5

%

46.5

%

Operating expenses - Sales and marketing expenses

(33

)

(1,061

)

(38

)

(1,212

)

(12.5

%)

(33

)

(1,061

)

(29

)

(915

)

15.9

%

- General and administrative expenses

(77

)

(2,428

)

(67

)

(2,119

)

14.6

%

(77

)

(2,428

)

(82

)

(2,579

)

(5.9

%)

- Research and development expenses

(104

)

(3,304

)

(104

)

(3,303

)

0.0

%

(104

)

(3,304

)

(101

)

(3,209

)

3.0

%

- Expected credit impairment loss

(0

)

(1

)

(0

)

(2

)

(68.6

%)

(0

)

(1

)

(0

)

(3

)

(75.8

%)

Subtotal

(214

)

(6,794

)

(209

)

(6,636

)

2.4

%

(214

)

(6,794

)

(212

)

(6,706

)

1.3

%

Net other operating income and expenses

40

 

1,287

 

39

 

1,227

 

4.9

%

40

 

1,287

 

44

 

1,398

 

(8.0

%)

Operating income

950

 

30,157

 

477

 

15,135

 

99.3

%

950

 

30,157

 

887

 

28,164

 

7.1

%

40.0

%

40.0

%

27.1

%

27.1

%

40.0

%

40.0

%

39.1

%

39.1

%

  Net non-operating income and expenses

69

 

2,189

 

136

 

4,317

 

(49.3

%)

69

 

2,189

 

(81

)

(2,586

)

-

 

Income from continuing operations   before income tax

1,019

 

32,346

 

613

 

19,452

 

66.3

%

1,019

 

32,346

 

806

 

25,578

 

26.5

%

42.9

%

42.9

%

34.8

%

34.8

%

42.9

%

42.9

%

35.5

%

35.5

%

  Income tax expense

(158

)

(5,004

)

(66

)

(2,100

)

138.3

%

(158

)

(5,004

)

(129

)

(4,088

)

22.4

%

Net income

861

 

27,342

 

547

 

17,352

 

57.6

%

861

 

27,342

 

677

 

21,490

 

27.2

%

36.3

%

36.3

%

31.0

%

31.0

%

36.3

%

36.3

%

29.8

%

29.8

%

  Other comprehensive income (loss)

137

 

4,336

 

(12

)

(370

)

-

 

137

 

4,336

 

(118

)

(3,749

)

-

 

  Total comprehensive income (loss)

998

 

31,678

 

535

 

16,982

 

86.5

%

998

 

31,678

 

559

 

17,741

 

78.6

%

  Net income attributable to:   Shareholders of the parent

851

 

26,996

 

550

 

17,460

 

54.6

%

851

 

26,996

 

672

 

21,327

 

26.6

%

  Non-controlling interests

10

 

346

 

(3

)

(108

)

-

 

10

 

346

 

5

 

163

 

111.6

%

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

987

 

31,332

 

538

 

17,090

 

83.3

%

987

 

31,332

 

554

 

17,578

 

78.2

%

  Non-controlling interests

11

 

346

 

(3

)

(108

)

-

 

11

 

346

 

5

 

163

 

111.6

%

  Earnings per share-basic

0.069

 

2.19

 

0.045

 

1.43

 

0.069

 

2.19

 

0.055

 

1.74

 

Earnings per ADS (2)

0.345

 

10.95

 

0.225

 

7.15

 

0.345

 

10.95

 

0.274

 

8.70

 

Weighted average number of shares outstanding (in millions)

12,306

 

12,206

 

12,306

 

12,283

 

    Notes: (1) New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2022 exchange rate of NT $31.74 per U.S. Dollar. (2) 1 ADS equals 5 common shares. UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES Consolidated Condensed Statements of Comprehensive Income Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$) Except Per Share and Per ADS Data  

For the Three-Month Period Ended

For the Nine-Month Period Ended

September 30, 2022

September 30, 2022

US$

NT$

%

US$

NT$

%

Operating revenues

2,375

 

75,392

 

100.0

%

6,644

 

210,870

 

100.0

%

Operating costs

(1,251

)

(39,728

)

(52.7

%)

(3,599

)

(114,230

)

(54.2

%)

Gross profit

1,124

 

35,664

 

47.3

%

3,045

 

96,640

 

45.8

%

    Operating expenses - Sales and marketing expenses

(33

)

(1,061

)

(1.4

%)

(102

)

(3,230

)

(1.5

%)

- General and administrative expenses

(77

)

(2,428

)

(3.2

%)

(228

)

(7,235

)

(3.4

%)

- Research and development expenses

(104

)

(3,304

)

(4.4

%)

(301

)

(9,547

)

(4.5

%)

- Expected credit impairment loss

(0

)

(1

)

(0.0

%)

(0

)

(2

)

(0.0

%)

Subtotal

(214

)

(6,794

)

(9.0

%)

(631

)

(20,014

)

(9.4

%)

Net other operating income and expenses

40

 

1,287

 

1.7

%

127

 

4,029

 

1.9

%

Operating income

950

 

30,157

 

40.0

%

2,541

 

80,655

 

38.3

%

  Net non-operating income and expenses

69

 

2,189

 

2.9

%

29

 

916

 

0.4

%

Income from continuing operations   before income tax

1,019

 

32,346

 

42.9

%

2,570

 

81,571

 

38.7

%

    Income tax expense

(158

)

(5,004

)

(6.6

%)

(399

)

(12,673

)

(6.0

%)

Net income

861

 

27,342

 

36.3

%

2,171

 

68,898

 

32.7

%

  Other comprehensive income (loss)

137

 

4,336

 

5.7

%

63

 

2,009

 

0.9

%

  Total comprehensive income (loss)

998

 

31,678

 

42.0

%

2,234

 

70,907

 

33.6

%

  Net income attributable to:   Shareholders of the parent

851

 

26,996

 

35.8

%

2,147

 

68,131

 

32.3

%

  Non-controlling interests

10

 

346

 

0.5

%

24

 

767

 

0.4

%

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

987

 

31,332

 

41.6

%

2,210

 

70,139

 

33.3

%

  Non-controlling interests

11

 

346

 

0.4

%

24

 

768

 

0.3

%

  Earnings per share-basic

0.069

 

2.19

 

0.175

 

5.54

 

Earnings per ADS (2)

0.345

 

10.95

 

0.873

 

27.70

 

  Weighted average number of shares   outstanding (in millions)

12,306

 

12,291

 

  Notes: (1) New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2022 exchange rate of NT $31.74 per U.S. Dollar. (2) 1 ADS equals 5 common shares. UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES Consolidated Condensed Statement of Cash Flows For The Nine-Month Period Ended September 30, 2022 Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)   US$ NT$ Cash flows from operating activities : Net income before tax

2,570

 

81,571

 

Depreciation & Amortization

1,061

 

33,692

 

Share of loss of associates and joint ventures

112

 

3,557

 

Income tax paid

(137

)

(4,333

)

Changes in working capital & others

(301

)

(9,582

)

Net cash provided by operating activities

3,305

 

104,905

 

  Cash flows from investing activities : Decrease in financial assets measured at amortized cost

898

 

28,488

 

Acquisition of property, plant and equipment

(1,392

)

(44,176

)

Acquisition of intangible assets

(73

)

(2,316

)

Others

(12

)

(379

)

Net cash used in investing activities

(579

)

(18,383

)

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

(55

)

(1,759

)

Redemption of bonds

(339

)

(10,763

)

Proceeds from long-term loans

22

 

710

 

Repayments of long-term loans

(367

)

(11,650

)

Increase in guarantee deposits

484

 

15,374

 

Cash distributed from additional paid-in capital

(1,180

)

(37,446

)

Others

(79

)

(2,535

)

Net cash used in financing activities

(1,514

)

(48,069

)

  Effect of exchange rate changes on cash and cash equivalents

302

 

9,574

 

Net increase in cash and cash equivalents

1,514

 

48,027

 

  Cash and cash equivalents at beginning of period

4,178

 

132,622

 

  Cash and cash equivalents at end of period

5,692

 

180,649

 

      Note: New Taiwan Dollars have been translated into U.S. Dollars at the September 30, 2022 exchange rate of NT $31.74 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 September 30, 2022, the three-month period ending June 30, 2022, and the equivalent three-month period that ended September 30, 2021. For all 3Q22 results, New Taiwan Dollar (NT$) amounts have been converted into U.S. Dollars at the September 30, 2022 exchange rate of NT$ 31.74 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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