UMC reported that its Q3 revenue increased 11.4 percent year-over-year and 23.6 percent sequentially to $952 million (31 billion New Taiwanese dollars) while net income rose 7.5 percent year-over-year and 88 percent sequentially to $283 million (9.23 billion NT).

UMC chairman and CEO, Dr. Jackson Hu, noted in a statement, “We had an excellent quarter for Q3, 2007. Our overall performance exceeded our guidance, including revenue, gross margin, operating margin, wafer shipment, loading, and other key indicators.”

“'Certainly the strong seasonal demand in Q3 was a main contributor. In the meantime, we must also point out that although revenue was impressive, it did not reach historical highs due to pricing pressure in both matured 8-inch and advanced 12-inch processes. This is a clear indication that there is too much competition within our industry. On the other hand, UMC continues to reconstruct its balance sheet to improve capital utilization and ROE. In Q3, we completed Taiwan's largest ever capital reduction plan by canceling 30 percent of UMC's outstanding shares, while returning (57.4 billion NT) to shareholders. Our cash position after the capital reduction remains very healthy,” he continued.

Looking ahead to next year, Hu said, “CAPEX for 2008 will be significantly reduced relative to 2007 for the following reasons: (1) We have found ways of enhancing productivity for certain critical and capital intensive equipment, (2) Our capacity expansion is mainly focused on converting capacity from older generations to more advanced processes. From now on, increasing profitability will be UMC's number one business objective. However, this goal will not happen overnight. A solid beginning will be the implementation of a disciplined CAPEX strategy.”

By: DocMemory
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