UMC's February Revenue Hits 11-Month Low

Taipei, March 10, 2011 (CENS)--United Microelectronics Corp. (UMC) saw its revenue for February decline to a 11-month low of NT$9 billion (US$300 million at US$1:NT$30) as a result of long Chinese New Year holidays in the month and the appreciation of the New Taiwan dollar against the U.S. dollar.

However, the February revenue represented a 4.32% increase from the same month of last year. In the first two months this year, the company scored total revenue of NT$18.5 billion (US$617 million), a gain of 7.53% year on year.

Although the February revenue was down 5.43% from a month earlier, the decline pace is slower than the 6-7% range expected by market insiders. Industry executives estimated the company's monthly revenue would return to the NT$10 billion (US$333 million) mark in March due to the slower-than-expected decline rate in February.

They projected the company's revenue for the first quarter at NT$28-28.5 billion (US$933.3-950 million), contracting around 10% from a quarter earlier. The decline rate could shrink to the 6-8% range if the exchange-rate factor is excluded.

UMC's estimated earlier that the company's wafer shipments for the first quarter would drop 5% at worst, suggesting business is not lukewarm as it was in the same quarter over past years. Average selling price, they estimated, would slip 1-5% this quarter if the exchange rate is not taken into account. The average capacity utilization at the company's factories is likely to remain at north of 90% and gross margin is estimated to stay above 25%.

Chip-making equipment suppliers pointed out that UMC's 300mm wafer factories using 65/55nm processes have been running at full capacity, its factories offering 40nm process have come on stream, and capacity utilization rate at its 200mm wafer factories is likely to run high in March.

Industry executives estimated the company revenue for the second quarter to improve from the first quarter, and expected its March revenue to increase from the previous two months.