UMC Reports Fourth Quarter 2014 Results

In 4Q14, foundry business grew 3.7% sequentially to NT$34.74 billion, including a one-time Fujitsu 40nm licensing fee, while New Business segment posted revenue of NT$2.52 billion, leading to consolidated revenue of NT$37.24 billion, up 5.7% from 3Q14. On a consolidated base, gross profit increased 34.8% to NT$10.19 billion, or 27.4% of revenue. Operating income grew 168.6% sequentially to NT$4.53 billion, or 12.2% of revenue. Net income attributable to the stockholders of the parent in 4Q14 was NT$4.56 billion, up 56.5% compared to NT$2.92 billion in 3Q14.

Earnings per ordinary share for the quarter were NT$0.36. Earnings per ADS were US$0.057. The basic weighted average number of outstanding shares in 4Q14 was 12,509,658,059, compared with 12,500,808,739 shares in 3Q14 and 12,476,082,332 shares in 4Q13. The diluted weighted average number of outstanding shares was 12,620,712,149 in 4Q14, compared with 12,582,502,645 shares in 3Q14 and 13,243,379,446 shares in 4Q13. The fully diluted share count on December 31, 2014 was approximately 12,779,034,000. On December 31, 2014, UMC held 195 million treasury shares acquired from the 15th share buy-back programs.

Detailed Financials Section

Foundry revenue increased 3.7% from 4Q14 to NT$34.74 billion, which included a Fujitsu 40nm licensing fee, while New Business posted NT$2.52 billion, which led to total revenue of NT$37.24 billion. Operating expenses increased 7.6% to NT$5.67 billion, partly due to a 17.5% rise in sales and marketing that included higher IP and mask expenses. Research and development expenses increased 1.9% to NT$3.54 billion or 9.5% of operating revenues. Net operating income was NT$4.53 billion.

COGS & Expenses

(Amount: NT$ million)

4Q14

3Q14

QoQ %
change

4Q13

YoY %
change

Net Operating Revenues

37,235

35,214

5.7

30,719

21.2

COGS

(27,049)

(27,655)

(2.2)

(25,162)

7.5

   Depreciation

(8,495)

(8,483)

0.1

(7,939)

7.0

   Other Mfg. Costs

(18,554)

(19,172)

(3.2)

(17,223)

7.7

Gross Profit

10,186

7,559

34.8

5,557

83.3

Gross Margin (%)

27.4%

21.5%


18.1%


Operating Expenses

(5,672)

(5,270)

7.6

(5,317)

6.7

   G&A

(1,013)

(845)

19.9

(826)

22.6

   Sales & Marketing

(1,124)

(957)

17.5

(906)

24.1

   R&D

(3,535)

(3,468)

1.9

(3,585)

(1.4)

Net Other Operating

Income & Expenses

18

(602)

-

(46)

-

Operating Income

4,532

1,687

168.6

194

2,236.1


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