Taiwan's TSMC Posts 229 Percent Q4 Profit Jump

STOCKHOLM (01/27/2000) - Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC), the world's largest dedicated contract semiconductor manufacturer, today reported a massive 229 percent jump in net income for its fourth quarter compared to the same period a year ago.

Net income for the quarter, ended Dec. 31, 1999, surged to NT$8.31 billion (US$270 million), or NT$1.08 per diluted common share, as compared to NT$2.52 billion and NT$0.33, respectively, for the fourth quarter of fiscal 1998.

Meanwhile, revenue rose 104 percent to NT$23.69 billion from NT$11.63 billion in the year ago period, TSMC said in a statement.

However, investors today remained lukewarm to the stock following a recent run in the company's share price. TSMC's share price on the Taiwan Stock Exchange closed today's trading at NT$208, up NT$2 on the day. In early afternoon trading on the New York Stock Exchange today, however, TSMC's American depository receipts (ADRs) were down to almost US$59 from US$63.25 yesterday.

TSMC said that fourth-quarter net income per ADR reached 17 cents, matching a consensus estimate from four analysts polled by First Call/Thomson Financial.

The quarter's revenue surge was mainly due to increased capacity and a better utilization rate, associated with recovery from the aftermath of the massive earthquake that rocked Taiwan in September last year, the Hsinchu, Taiwan-based company said.

For the full fiscal year 1999, ended Dec. 31, TSMC reported net income of NT$24.6 billion, an increase of 60 percent over the NT$15.3 billion it posted for 1998. Revenue rose by a more modest 46 percent from NT$50.2 billion in 1998 to NT$73.1 billion last year.

In a separate statement issued today, TSMC Chairman Morris Chang said that IBM Corp. had approached TSMC to propose joint-development of next-generation 0.13 micron process technology. According to Chang, however, TSMC turned IBM down, preferring to develop its own technology. IBM together with Infineon Technologies AG today announced a similar arrangement with TSMC's crosstown arch-rival United Microelectronics Corp. [See "IBM, Infineon, United Micro Team on Semiconductors," Jan. 27.]A so-called foundry service provider, TSMC manufactures chips according to its customers' designs. The company does not sell any products under its own name, but is a contract manufacturer for many of the world's major chip vendors.

TSMC, in Hsinchu, Taiwan, can be reached via the Web at http://www.tsmc.com.tw/.

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