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Chip makers see mixed results

Chip makers see mixed results

The world’s largest semiconductor manufacturers have released mixed financial results for 2002 and, with the exception of a weak first quarter, predict that the market to pick up again this year.

The world's largest contract chip maker, Taiwan Semiconductor Manufacturing (TSMC), has reported fourth-quarter net sales of $US2.02 billion, up 24.2 per cent on the same period in 2001. Net income for the fourth quarter, however, was down 43.4 per cent to $US125 million from $US221.12 million a year earlier.

The drop in net income was the result of increased expenditures on research and development and investment losses, TSMC said.

The world’s second largest chip maker, United Microelectronics (UMC), managed to turn a profit during 2002, reversing heavy losses suffered by the company in 2001.

UMC reported net profit of $US204.6 million on net sales of $US1.9 billion for the year ended December 31, 2002, compared with losses of $US92 million on sales of $US1.86 billion in 2001.

For the fourth quarter of 2002, UMC reported net revenue of $US504 million, up 25.8 percent on the same period one year earlier. The company saw fourth-quarter net income hit $US28.5 million, compared to a loss of $US109 million during the final quarter of 2001.

Strong demand for chips made using a 130-nanometer process technology accounted for 6 percent of UMC's fourth-quarter revenue, the company said. The number refers to the size of the smallest feature that can be created on a chip.

Meanwhile, a recovery seemed on the cards for the third-largest outsourced chip manufacturer, Chartered Semiconductor Manufacturing, following a dismal fiscal 2001. Revenues had been rising steadily through 2002, but a significant dip in revenue in the fourth quarter of its 2002 financial year took a considerable toll on the company’s results.

The company posted revenues of $US107.9 million for the fourth quarter ended December 31, 2002, 17 per cent lower than in the third quarter.

Chartered President & Chief Executive Officer, Chia Song Hwee, said that the market continued to be very challenging in 2002. Expectations for revenue growth had been wiped out by the poor fourth quarter.

For the year 2002, Chartered recorded revenue of $US449.2 million, 2.9 per cent down on 2001's $US462.7 million.

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