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
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 of
foreign operations and unrealized gains or losses on financial
assets measured at fair value through other comprehensive
income |
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 operations
before 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 operations
before 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 shares
outstanding (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.
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