UMC Reports Fourth Quarter 2019 Results

First Quarter of 2020 Outlook & Guidance

Quarter-over-Quarter Guidance:

  • Wafer Shipments: To remain flat
  • ASP in USD: To remain flat
  • Profitability: Gross profit margin will be in the mid-teens % range
  • Foundry Segment Capacity Utilization: around 90%
  • 2020 CAPEX for Foundry Segment: US$1 billion

Recent Developments / Announcements

Feb 4, 2020

UMC Leads all Semi Foundries with CDP “Leadership Level” Designation on Global Climate Change Assessment

Feb 3, 2020

UMC Announces 14nm certification on Mentor’s Calibre Eco Fill Flow

Jan 20, 2020

eMemory and UMC Qualify NeoFuse IP on the Foundry’s 28nm High Voltage Process

Dec 2, 2019

UMC Announces 22nm Technology Readiness Following Silicon Validation

Nov 18, 2019

Faraday and UMC Collaborate to Launch a Complete Set of 22nm Fundamental IP

Oct 30, 2019

UMC 3Q 2019 Financial Results

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

Conference Call / Webcast Announcement

Wednesday, February 5, 2020

Time: 5:00 PM (Taipei) / 4:00 AM (New York) / 09:00 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 4Q19 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 mature and advanced IC production with a focus on Specialty Technologies to serve 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 high volume 28nm High-K/Metal Gate technology, volume production 14nm FinFET, 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 12 wafer fabs are strategically located throughout Asia and are able to produce more than 700,000 wafers per month. The company employs approximately 19,000 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.

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 December 31, 2019
Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)
 
 

December 31, 2019

US$

NT$

%

Assets
Current assets
Cash and cash equivalents

3,175

95,492

25.8%

Notes & Accounts receivable, net

855

25,729

7.0%

Inventories, net

722

21,715

5.9%

Other current assets

360

10,821

2.8%

Total current assets

5,112

153,757

41.5%

 
Non-current assets
Funds and investments

1,375

41,362

11.2%

Property, plant and equipment

4,999

150,374

40.6%

Right-of-use assets

276

8,292

2.2%

Other non-current assets

545

16,402

4.5%

Total non-current assets

7,195

216,430

58.5%

Total assets

12,307

370,187

100.0%

 
Liabilities
Current liabilities
Short-term loans

399

12,015

3.2%

Payables

934

28,083

7.6%

Current portion of long-term liabilities

824

24,796

6.7%

Other current liabilities

260

7,820

2.1%

Total current liabilities

2,417

72,714

19.6%

 
Non-current liabilities
Bonds payable

621

18,688

5.1%

Long-term loans

971

29,200

7.9%

Lease liabilities, noncurrent

182

5,461

1.5%

Other non-current liabilities

1,227

36,910

9.9%

Total non-current liabilities

3,001

90,259

24.4%

Total liabilities

5,418

162,973

44.0%

 
Equity
Equity attributable to the parent company
Capital

3,909

117,576

31.8%

Additional paid-in capital

1,315

39,550

10.7%

Retained earnings, exchange differences on translation of
foreign operations, unrealized gains or losses on financial
assets measured at fair value through other comprehensive
income and gains or losses on hedging Instruments

1,655

49,798

13.4%

Treasury stock

(4)

(120)

(0.0%)

Total equity attributable to the parent company

6,875

206,804

55.9%

Non-controlling interests

14

410

0.1%

Total equity

6,889

207,214

56.0%

Total liabilities and equity

12,307

370,187

100.0%

Note:New Taiwan Dollars have been translated into U.S. Dollars at the December 31, 2019 exchange rate of NT $30.08 per U.S. Dollar.
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES
Consolidated Condensed Statements of Comprehensive Income
Figures in Millions of New Taiwan Dollars (NT$) 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

December 31, 2019

December 31, 2018

Chg.

December 31, 2019

September 30, 2019

Chg.

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

1,391

41,849

1,181

35,517

17.8%

1,391

41,849

1,255

37,738

10.9%

Operating costs

(1,159)

(34,881)

(1,028)

(30,916)

12.8%

(1,159)

(34,881)

(1,041)

(31,305)

11.4%

Gross profit

232

6,968

153

4,601

51.4%

232

6,968

214

6,433

8.3%

16.7%

16.7%

13.0%

13.0%

16.7%

16.7%

17.1%

17.1%

Operating expenses
- Sales and marketing expenses

(33)

(996)

(30)

(903)

10.4%

(33)

(996)

(32)

(970)

2.8%

- General and administrative expenses

(53)

(1,603)

(44)

(1,339)

19.7%

(53)

(1,603)

(45)

(1,344)

19.2%

- Research and development expenses

(115)

(3,453)

(125)

(3,745)

(7.8%)

(115)

(3,453)

(94)

(2,813)

22.7%

- Expected credit losses

(4)

(113)

(14)

(409)

(72.5%)

(4)

(113)

(0)

(4)

2,903.5%

Subtotal

(205)

(6,165)

(213)

(6,396)

(3.6%)

(205)

(6,165)

(171)

(5,131)

20.2%

Net other operating income and expenses

40

1,215

40

1,206

0.7%

40

1,215

40

1,207

0.6%

Operating income (loss)

67

2,018

(20)

(589)

-

67

2,018

83

2,509

(19.6%)

4.8%

4.8%

(1.7%)

(1.7%)

4.8%

4.8%

6.7%

6.7%

 
Net non-operating income and expenses

32

946

(66)

(1,998)

-

32

946

(17)

(532)

-

Income (loss) from continuing operations
before income tax

99

2,964

(86)

(2,587)

-

99

2,964

66

1,977

49.9%

7.1%

7.1%

(7.3%)

(7.3%)

7.1%

7.1%

5.2%

5.2%

 
Income tax benefit (expense)

6

191

(14)

(413)

-

6

191

(2)

(39)

-

Net income (loss)

105

3,155

(100)

(3,000)

-

105

3,155

64

1,938

62.8%

7.5%

7.5%

(8.4%)

(8.4%)

7.5%

7.5%

5.1%

5.1%

 
Other comprehensive income (loss)

(51)

(1,538)

4

110

-

(51)

(1,538)

20

591

-

 
Total comprehensive income (loss)

54

1,617

(96)

(2,890)

-

54

1,617

84

2,529

(36.0%)

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

128

3,837

(57)

(1,707)

-

128

3,837

97

2,929

31.0%

  Non-controlling interests

(23)

(682)

(43)

(1,293)

(47.3%)

(23)

(682)

(33)

(991)

(31.2%)

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

76

2,291

(53)

(1,608)

-

76

2,291

118

3,540

(35.3%)

  Non-controlling interests

(22)

(674)

(43)

(1,282)

(47.5%)

(22)

(674)

(34)

(1,011)

(33.4%)

 
Earnings per share-basic

0.011

0.33

(0.005)

(0.14)

0.011

0.33

0.008

0.25

Earnings per ADS (2)

0.055

1.65

(0.023)

(0.70)

0.055

1.65

0.042

1.25

Weighted average number of shares
outstanding (in millions)

11,709

12,112

11,709

11,708

 
 
Notes:
(1) New Taiwan Dollars have been translated into U.S. Dollars at the December 31, 2019 exchange rate of NT $30.08 per U.S. Dollar.
(2) 1 ADS equals 5 common shares.
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES
Consolidated Condensed Statements of Comprehensive Income
Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)
Except Per Share and Per ADS Data
 

For the Three-Month Period Ended

For the Twelve-Month Period Ended

December 31, 2019

December 31, 2019

US$

NT$

%

US$

NT$

%

Operating revenues

1,391

41,849

100.0%

4,927

148,202

100.0%

Operating costs

(1,159)

(34,881)

(83.3%)

(4,218)

(126,887)

(85.6%)

Gross profit

232

6,968

16.7%

709

21,315

14.4%

 
 
Operating expenses
- Sales and marketing expenses

(33)

(996)

(2.4%)

(127)

(3,808)

(2.6%)

- General and administrative expenses

(53)

(1,603)

(3.8%)

(181)

(5,436)

(3.6%)

- Research and development expenses

(115)

(3,453)

(8.3%)

(394)

(11,860)

(8.0%)

- Expected credit losses

(4)

(113)

(0.3%)

(23)

(703)

(0.5%)

Subtotal

(205)

(6,165)

(14.8%)

(725)

(21,807)

(14.7%)

Net other operating income and expenses

40

1,215

2.9%

172

5,182

3.5%

Operating income

67

2,018

4.8%

156

4,690

3.2%

 
Net non-operating income and expenses

32

946

2.3%

35

1,046

0.7%

Income from continuing operations
before income tax

99

2,964

7.1%

191

5,736

3.9%

 
 
Income tax benefit

6

191

0.4%

13

393

0.2%

Net income

105

3,155

7.5%

204

6,129

4.1%

 
Other comprehensive income (loss)

(51)

(1,538)

(3.7%)

113

3,409

2.3%

 
Total comprehensive income (loss)

54

1,617

3.8%

317

9,538

6.4%

 
Net income attributable to:
  Stockholders of the parent

128

3,837

9.2%

323

9,708

6.6%

  Non-controlling interests

(23)

(682)

(1.7%)

(119)

(3,579)

(2.5%)

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

76

2,291

5.5%

437

13,132

8.9%

  Non-controlling interests

(22)

(674)

(1.7%)

(120)

(3,594)

(2.5%)

 
Earnings per share-basic

0.011

0.33

0.027

0.82

Earnings per ADS (2)

0.055

1.65

0.136

4.10

 
Weighted average number of shares
outstanding (in millions)

11,709

11,785

 
Notes:
(1) New Taiwan Dollars have been translated into U.S. Dollars at the December 31, 2019 exchange rate of NT $30.08 per U.S. Dollar.
(2) 1 ADS equals 5 common shares.
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES
Consolidated Condensed Statement of Cash Flows
For The Twelve-Month Period Ended December 31, 2019
Figures in Millions of New Taiwan Dollars (NT$) and U.S. Dollars (US$)
 

US$

NT$

Cash flows from operating activities :
Net income before tax

191

5,736

Depreciation & Amortization

1,642

49,390

Expected credit losses

23

703

Share of profit of associates and joint ventures

(38)

(1,147)

Income tax paid

(21)

(619)

Changes in working capital & others

28

841

Net cash provided by operating activities

1,825

54,904

 
Cash flows from investing activities :
Acquisition of subsidiaries (net of cash acquired)

(426)

(12,801)

Acquisition of property, plant and equipment

(549)

(16,518)

Acquisition of intangible assets

(81)

(2,444)

Others

3

81

Net cash used in investing activities

(1,053)

(31,682)

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

(33)

(994)

Redemption of bonds

(83)

(2,500)

Proceeds from long-term loans

381

11,450

Repayments of long-term loans

(252)

(7,573)

Cash dividends

(230)

(6,911)

Treasury stock acquired

(99)

(2,972)

Others

(12)

(367)

Net cash used in financing activities

(328)

(9,867)

 
Effect of exchange rate changes on cash and cash equivalents

(51)

(1,525)

Net increase in cash and cash equivalents

393

11,830

 
Cash and cash equivalents at beginning of period

2,782

83,662

 
Cash and cash equivalents at end of period

3,175

95,492

 
 
Note: New Taiwan Dollars have been translated into U.S. Dollars at the December 31, 2019 exchange rate of NT $30.08 per U.S. Dollar.
 

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