02.08.2001
UMC's Jan. 2001 revenue exceeds expectations

• UMC (2303 'Lian Dian') reported Jan 2001 revenue at NT$9.5b, up 56% YoY and down 7.6% MoM.

• The company indicated in 4Q00 that it expected flat pricing and a less aggressive 8-inch fab capacity ramping schedule. In Jan.2001, the company also faced the Chinese New Year holiday, and the annual maintenance shut down. Taking these factors into consideration, we believe that actual utilization came in at above 90% during Jan. This decline was smaller than the QoQ utilization decline of 10-15% that the company had previously predicted for 1Q01.

• Reports in the local press indicate that UMC has increased memory production to fill capacity.

• Since we do not see TSMC's (2330 'Tai Ji Dian') warning of a further industry slowdown during 1Q01 as an isolated case, we expect UMC to face deteriorating utilization for the remainder of the quarter.

LindaLiu@Primasia.com +886-[0]2-2547-8867