Year-over-year, second quarter revenue decreased 8.8% while net income and diluted EPS both decreased 25.1%. On a sequential basis, second quarter results represent a 15.4% increase in revenue, and an increase of 35.3% both in net income and in diluted EPS. All figures were prepared in accordance with R.O.C. GAAP on a consolidated basis.
Second quarter results were in-line with the guidance given on April 26. Advanced process technologies (0.13-micron and below) accounted for 53% of wafer revenues with 90-nanometer process technology accounting for 26% and 65- nanometer reaching 3% of total wafer sales. Gross margin was 43%, operating margin was 33%, and net margin increased 5 percentage points to 34% from the previous quarter.
"The recovery of our business, which started in March, has continued through the second quarter, and the momentum is expected to last through the third quarter," said Lora Ho, VP and Chief Financial Officer of TSMC. "Relative to the second quarter, the computer segment shows the strongest growth while the communication and consumer segments' growth will also continue, albeit at a lower pace," said Ho. "Based on our current business outlook, management's expectations for third quarter 2007 performance are as follows":
-- Revenue is expected to be between NT$85 billion and NT$87 billion;
-- Gross profit margin is expected to be between 43% and 45%;
-- Operating profit margin is expected to be between 33% and 35%.
Conference Call & Webcast Notice:
TSMC's quarterly review conference call will be held at 8 a.m. Eastern Time (8 p.m. Taiwan Time) on Thursday, July 26, 2007. The conference call will also be webcast live on the Internet. Investors wishing to access the live webcast should visit TSMC's web site at http://www.tsmc.com at least 15 minutes prior to the broadcast. Instructions will be provided on the web site to facilitate the download and installation of necessary audio applications. Investors without Internet access may listen to the conference call, in listen-only mode, by dialing 1-617-213-8058 in the U.S., 852-3002-1672 in Hong Kong, 65-6823-2164 in Singapore, and 44-207-365-8426 in the U.K. (Password: TSMC). An archived version of the webcast will be available on TSMC's web site for six months following the Company's quarterly review conference call and webcast.
Profile
TSMC (NYSE: TSM) is the world's largest dedicated semiconductor foundry, providing the industry's leading manufacturing capacity, process technology, and the foundry industry's largest portfolio of process- proven libraries, IP, design tools and reference flows. TSMC currently operates two twelve-inch wafer fabs, four eight-inch fabs and one six-inch fab. The Company also operates two eight-inch fabs at its wholly owned subsidiaries, WaferTech in the U.S. and TSMC (Shanghai) Company, Ltd. in China, and has substantial capacity commitments from a joint-venture fab, SSMC, in Singapore. Total managed capacity in 2006 exceeded seven million eight-inch equivalent wafers. TSMC is the first foundry to provide 65-nanometer production capabilities. TSMC's corporate headquarters are in Hsin-Chu, Taiwan. More information about TSMC is available at http://www.tsmc.com .
Safe Harbor Notice:
The statements included in this press release that are not historical in nature are "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. TSMC cautions readers that forward-looking statements are subject to significant risks and uncertainties and are based on TSMC's current expectations. Actual results may differ materially from those contained in such forward-looking statements for a variety of reasons including, among others, risks associated with cyclicality and market conditions in the semiconductor industry; demand and supply for TSMC's foundry manufacturing capacity in particular and for foundry manufacturing capacity in general; intense competition; the failure of one or more significant customers to continue to place the same level of orders with us; TSMC's ability to remain a technological leader in the semiconductor industry; TSMC's ability to manage its capacity; TSMC's ability to obtain, preserve and defend its intellectual property rights; natural disasters and other unexpected events which may disrupt production; and exchange rate fluctuations. Additional information as to these and other risk factors that may cause TSMC's actual results to differ materially from TSMC's forward-looking statements may be found in TSMC's Annual Report on Form 20-F, filed with the United States Securities and Exchange Commission (the "SEC") on April 20, 2007, TSMC's registration statement on Form F-3, filed with the SEC on May 8, 2007, and such other documents as TSMC may file with, or submit to, the SEC from time to time. Except as required by law, we undertake no obligation to update any forward- looking statement, whether as a result of new information, future events, or otherwise.
(Management Report and Tables Follow)
2Q07 Quarterly Management Report July 26, 2007
Topics in This Report
-- Revenue Analysis
-- Capacity
-- Profit & Expense Analysis
-- Financial Condition Review
-- Cash Flow & CapEx
-- Recap of Recent Important Events & Announcements
Operating Results Review:
Summary:
(Amounts are on consolidated 2Q07 1Q07 2Q06 QoQ YoY
basis and are in NT$ billion
except noted otherwise)
EPS (NT$ per common share)
(US$ per ADR unit) 0.96 0.71 1.29 35.3% (25.1%)
0.15 0.11 0.20 -- --
Consolidated Net Sales 74.92 64.90 82.12 15.4% (8.8%)
Gross Profit 32.18 24.61 42.50 30.8% (24.3%)
Gross Margin 43.0% 37.9% 51.8% -- --
Operating Expense (7.45) (6.73) (7.18) 10.6% 3.8%
Non-Operating Items 3.29 2.19 0.95 50.2% 246.7%
Net Income 25.48 18.84 34.00 35.3% (25.1%)
Net Profit Margin 34.0% 29.0% 41.4% -- --
Wafer Shipment
(kpcs 8 inch-equiv.) 1,856 1,566 1,869 18.5% (0.7%)
Remarks:
The second quarter diluted earnings per share were NT$0.96, representing a 25.1% decrease over the same period last year and a 35.3% sequential increase from the previous quarter. The consolidated operating results of 2Q07 are summarized below:
Second quarter net sales were NT$75 billion, a decline of 8.8% compared to net sales of NT$82 billion for the same period a year ago and an increase of 15.4% compared to net sales of NT$65 billion in the prior quarter.
Gross profit for 2Q07 was NT$32 billion, which represents a year-over-year decrease of 24.3% and a quarter-over-quarter increase of 30.8%. Second quarter gross margin was 43%, higher than the 37.9% gross margin reported in the first quarter of 2007.
Operating expenses were NT$7.4 billion or 10% of the net sales. The combined result from non-operating income and long-term investments was a gain of NT$3.3 billion.
Consolidated net income attributable to shareholders of the parent company was NT$25 billion, down 25.1% from a year ago level and up 35.3% from the previous quarter. Net profit margin was 34% for 2Q07.
I. Revenue Analysis
I . Wafer Sales Analysis
By Application 2Q07 1Q07 2Q06
Computer 29% 30% 30%
Communication 44% 42% 44%
Consumer 18% 17% 20%
Industrial/Others 6% 7% 5%
Memory 3% 4% 1%
By Technology 2Q07 1Q07 2Q06
65nm and below 3% 1% --
90nm 26% 22% 24%
0.11/0.13um 24% 26% 25%
0.15/0.18um 30% 30% 32%
0.25/0.35um 12% 15% 14%
0.50um+ 5% 6% 5%
By Customer
Type 2Q07 1Q07 2Q06
Fabless/System 68% 65% 72%
IDM 32% 35% 28%
By Geography 2Q07 1Q07 2Q06
North America 74% 77% 77%
Asia Pacific 13% 11% 10%
Europe 9% 7% 9%
Japan 4% 5% 4%
Revenue Analysis:
Second quarter consolidated net sales came in at the high end of our expectation to reach NT$75 billion.
Businesses from the three main applications recovered from the inventory correction. On a sequential basis, revenues from communication and consumer applications both increased by 25%, while revenues from computer applications increased by 13%.
Revenues from 65nm and 90nm accounted for 3% and 26% of total wafer sales, respectively, higher than that in the previous quarter. Revenues from advanced technologies (0.13-micron and below) accounted for 53% of total wafer sales, up four percentage points from the first quarter of 2007.
Revenues from IDM customers accounted for 32% of total wafer sales during the quarter, compared to 35% in the previous quarter.
Geographically, revenues from North America accounted for 74% of total wafer sales. Meanwhile, sales from Asia Pacific, Europe and Japan accounted for 13%, 9% and 4% of wafer sales, respectively.
II . Capacity
Fab / (Wafe size) 1Q07 2Q07 3Q07 4Q07 2007
(A) (A) (F) (F) (F)
Fab-2 (6")(Note 1) 257 257 273 273 1,060
Fab-3 (8") 259 262 267 269 1,057
Fab-5 (8") 144 155 163 166 627
Fab-6 (8") 245 255 274 279 1,053
Fab-8 (8") 239 239 260 265 1,004
Fab-12 (12")(Note 2) 169 180 198 221 768
Fab-14 (12")(Note 2) 103 113 154 176 546
WaferTech (8") 104 105 106 106 419
TSMC (Shanghai) (8") 90 94 99 106 389
TSMC total capacity
(8"equiv. Kpcs) 1,836 1,913 2,113 2,237 8,099
SSMC (8") 53 55 56 61 226
Total managed capacity
(8" equiv. Kpcs) 1,890 1,967 2,169 2,298 8,325
Note: 1. Figures represent number of 6" wafers. Conversion to
8"-equivalent wafers is by dividing this number by 1.78
2. Figures represent number of 12" wafers. Conversion to
8"-equivalent wafers is by multiplying this number by 2.25
Capacity:
Total TSMC managed capacity was 1,967K 8-inch equivalent wafers in 2Q07, 4% higher than 1Q07. TSMC managed capacity in 3Q07 will increase by 10% sequentially to reach 2,169K 8-inch equivalent wafers.
Total managed capacity for year 2007 is expected to be 8,325K 8-inch equivalent wafers, up 18% from 7,062K 8-inch equivalent wafers in year 2006.
III. Profit & Expense Analysis
III - 1. Gross Profit Analysis
(In NT billions) 2Q07 1Q07 2Q06
COGS 42.7 40.3 39.6
Depreciation 17.9 18.5 16.5
Other MFG Cost 24.8 21.8 23.1
Gross Profit 32.2 24.6 42.5
Gross Margin 43.0% 37.9% 51.8%
Gross Profit Analysis:
Consolidated gross profit for the second quarter 2007 was NT$32 billion, or 43% of net sales, up from a gross profit of NT$25 billion, or 37.9% of net sales, in the previous quarter. Second quarter gross margin improved by 5.1 percentage points primarily due to higher capacity utilization and lower depreciation expenses, offset slightly by a lower average selling price.
III - 2. Operating Expenses *
(In NT billions) 2Q07 1Q07 2Q06
Total Operating Exp. 7.45 6.73 7.18
SG&A 3.15 2.79 3.08
Research &
Development 4.30 3.94 4.10
* Certain prior period amounts have been reclassified to conform with
current period presentation.
Operating Expenses:
Total operating expenses for 2Q07 were NT$7.4 billion, compared to NT$6.7 billion in the prior quarter. Total operating expenses represented 10% of net sales, down slightly from 10.4% in first quarter of 2007.
Research and development expenditures increased by NT$359 million sequentially, largely due to increased R&D spending on 45nm and 32nm related projects.
SG&A expenses were NT$3.1 billion for the quarter, an increase of NT$354 million quarter-over-quarter, mainly due to higher level of business activities.
III - 3. Non-Operating Items
(In NT millions) 2Q07 1Q07 2Q06
Non-Operating Income/(Exp.) 2,802 1,830 299
Net Interest Income/(Exp.) 1,338 1,162 924
Other Non-Operating 1,464 668 (625)
L-T Investments 488 361 650
SSMC 233 70 471
Others 255 291 179
Total Non-Operating Items 3,290 2,191 949
Non-Operating Items:
Combined result from non-operating income and long-term investments was a gain of NT$3.3 billion for second quarter of 2007.
Compared to 1Q07, higher non-operating income was mainly due to higher interest income, an increase in mark-to-market adjustment on certain marketable securities, and lawsuit settlement received from SMIC.
Net investment income increased slightly to reach NT$488 million in the quarter, reflecting improved operating performance at SSMC.
IV. Financial Condition Review
IV - 1. Liquidity Analysis
(Selected Balance Sheet Items)
(In NT billions) 2Q07 1Q07 2Q06
Cash & Marketable Securities 233.1 217.4 211.6
Accounts Receivable - Trade 37.1 33.1 38.0
Inventory 24.0 22.3 20.1
Total Current Assets 304.6 286.1 279.7
Accounts Payable 28.2 19.2 27.5
Current Portion of Bonds Payable 4.5 4.5 2.5
Accrued Cash Dividend & Profit
Sharing 82.1 0.0 65.2
Accrued Liabilities and Others 17.6 21.4 15.1
Total Current Liabilities 132.4 45.1 110.3
Current Ratio (x) 2.3 6.3 2.5
Net Working Capital 172.2 241.0 169.4
Liquidity Analysis:
Total cash and marketable securities increased by NT$16 billion in the second quarter of 2007, mainly due to free cash flows generated during the quarter. As a result, TSMC ended the quarter with NT$305 billion in total current assets, compared to NT$286 billion at the end of the previous quarter.
Total current liabilities were NT$132 billion at the end of the quarter, compared to NT$45 billion at the end of the previous quarter. The increase was mainly due to NT$ 77.5 billion and NT$4.6 billion payables accrued for cash dividends and employee bonuses, respectively.
As a result, net working capital decreased to NT$172 billion with a current ratio of 2.3.
IV - 2. Receivable/Inventory Days 2Q07 1Q07 2Q06
Days of Receivable 44 47 44
Days of Inventory 52 52 47
Receivable/Inventory Days Trend:
Days of receivable were 44 days in 2Q07, compared to 47 days in the previous quarter.
Days of inventory remained flat at 52 days.
IV - 3. Debt Service
(In NT billions) 2Q07 1Q07 2Q06
Cash & Marketable Securities 233.1 217.4 211.6
Interest-Bearing Debt 26.3 26.2 27.2
Net Cash Reserves 206.8 191.2 184.4
Debt Service:
As a result of the free cash flows generated during the quarter, net cash reserves -- defined as the excess of cash and short-term marketable securities over interest-bearing debt -- increased by NT$16 billion to reach NT$207 billion in 2Q07.
V. Cash Flow & CapEx
V - 1. Cash Flow Analysis
(In NT billions) 2Q07 1Q07 2Q06
Net Income 25.5 18.8 34.0
Depreciation & Amortization 19.6 20.3 17.9
Other Op Sources/(Uses) (10.4) (1.0) (1.5)
Total Op Sources/(Uses) 34.7 38.1 50.4
Capital Expenditure (25.3) (14.0) (21.4)
Marketable Financial Instruments 15.8 3.5 (7.8)
Other Investing Sources/(Uses) (0.7) (2.9) (1.1)
Net Investing Sources/(Uses) (10.2) (13.4) (30.3)
Repayment of Bonds Payable 0.0 (2.5) 0.0
Other Financing Sources/(Uses) (0.5) (0.3) 0.1
Net Financing Sources/(Uses) (0.5) (2.8) 0.1
Net Cash Position Changes 24.0 21.9 20.2
Exchange Rate Changes & Others (0.9) 0.6 (0.0)
Ending Cash Balance 163.4 140.3 141.5
Summary of Cash Flow:
During second quarter of 2007, TSMC generated NT$35 billion in cash from operating activities, mainly from net income of NT$25 billion and depreciation & amortization of NT$20 billion, offset in part by the change in net working capital.
Net cash used in investment activities totaled NT$10 billion, mainly due to capital expenditures of NT$25 billion, partially offset by an NT$16 billion in net proceeds from the disposition of marketable financial instruments.
Net cash used in financing activities was NT$1 billion during the quarter.
As a result, TSMC ended the quarter with a cash balance of NT$163 billion, NT$23 billion higher than in 1Q07.
V - 2. Operating and Free Cash Flows
For the chart of V - 2. Operating and Free Cash Flows, please refer to http://www.tsmc.com/uploadfile/ir/quarterly/index_charts.pdf .
Operating and Free Cash Flows:
TSMC continues to generate strong operating cash flows and free cash flows. Cash flows generated from operating activities were NT$35 billion. Free cash flows, defined as the excess of operating cash flows over capital expenditures, totaled NT$9 billion in 2Q07, compared to NT$24 billion generated in the previous quarter, mainly due to higher level of capital expenditures in 2Q07.
V - 3. Capital Expenditures
(In US$ Million) 2Q07 1Q07 YTD
TSMC 747 419 1,166
XinTec and GUC 13 3 16
TSMC Shanghai & WaferTech 4 2 6
Other TSMC Subsidiaries 2 0 2
Total TSMC 766 424 1,190
Capital Expenditures:
Capital expenditures for TSMC consolidated group totaled US$766 million during the quarter. Most of the spending was for the purchase of 12-inch production equipment.
For year 2007, total capital expenditures for TSMC consolidated group is expected to be in the range of US$2.6 billion to US$2.8 billion, unchanged from our previous guidance.
VI. Recap of Recent Important Events & Announcements
-- TSMC Announces Winners of Second TSMC Outstanding Student Research
Award (2007/06/29)
-- TSMC Announces Active Accuracy Assurance Initiative (2007/06/04)
-- TSMC Unveils Reference Flow 8.0 to Address 45nm Design Challenges
(2007/06/04)
-- AMD Chooses TSMC 65nm Process for GPU Product Line (2007/05/22)
-- TSMC Successfully Completes Secondary Offering of 240 Million ADSs
Priced at US$10.68 Per Share (2007/05/18)
-- TSMC and Spansion Sign Joint Development Agreement to Expand MirrorBit
Technology Applicability at 40nm and Below (2007/05/15)
-- TSMC Board Approves Expansion of 45 Nanometer Capacity (2007/05/08)
-- TSMC Shareholders Approve NT$3.0 Cash and 0.5% Stock Dividend
(2007/05/07)
* Please visit TSMC's Web site ( http://www.tsmc.com ) for details about these and other announcements.
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(Expressed in Millions of New Taiwan Dollars (NTD) and U.S. Dollars
(USD)) (1)
March 31, 2007
June 30, 2007 (audited) (unaudited)
ASSETS USD NTD % NTD %
Current Assets
Cash and Cash Equivalents $4,991 $163,391 25.6 $140,274 23.0
Investments in Marketable
Financial Instruments 2,129 69,685 10.9 77,096 12.7
Accounts Receivable - Trade 1,132 37,054 5.8 33,094 5.4
Inventories, Net 735 24,045 3.8 22,259 3.7
Other Current Assets 319 10,464 1.7 13,356 2.2
Total Current Assets 9,306 304,639 47.8 286,079 47.0
Long-Term Investments 1,379 45,153 7.1 52,185 8.6
Property, Plant and Equipment 23,434 767,100 120.3 734,182 120.6
Less: Accumulated Depreciation (15,351) (502,495) -78.8 (483,834) -79.5
Property, Plant and
Equipment, Net 8,083 264,605 41.5 250,348 41.1
Other Assets 705 23,037 3.6 20,159 3.3
Total Assets $19,473 $637,434 100.0 $608,771 100.0
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current Liabilities
Short-Term Bank Loans $3 $99 -- $79 --
Accounts Payables 341 11,157 1.8 10,129 1.7
Payables to Contractors and
Equipment Suppliers 520 17,010 2.7 9,094 1.5
Accrued Expenses and Other
Current Liabilities 3,035 99,365 15.5 21,101 3.4
Current Portion of Bonds
Payable and Long-Term
liabilities 146 4,782 0.8 4,714 0.8
Total Current Liabilities 4,045 132,413 20.8 45,117 7.4
Bonds Payable 382 12,500 2.0 12,500 2.1
Other Long-Term Liabilities 570 18,649 2.9 19,415 3.2
Total Liabilities 4,997 163,562 25.7 77,032 12.7
Shareholders' Equity
Attributable to Shareholders
of the Parent
Capital Stock 8,072 264,235 41.5 258,330 42.4
Capital Surplus 1,641 53,726 8.4 54,231 8.9
Retained Earnings 4,705 154,010 24.2 215,963 35.5
Treasury Stock (28) (918) -0.1 (918) -0.2
Others (5) (167) -0.1 1,020 0.2
Total Equity Attributable
to Shareholders of the
Parent 14,385 470,886 73.9 528,626 86.8
Minority Interest 91 2,986 0.4 3,113 0.5
Total Shareholders' Equity 14,476 473,872 74.3 531,739 87.3
Total Liabilities &
Shareholders' Equity $19,473 $637,434 100.0 $608,771 100.0
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(Expressed in Millions of New Taiwan Dollars (NTD) and U.S. Dollars
(USD)) (1)
June 30, 2006
(audited) QoQ YoY
ASSETS NTD % Amount % Amount %
Current Assets
Cash and Cash
Equivalents $141,452 23.8 $23,117 16.5 $21,939 15.5
Investments in
Marketable Financial
Instruments 70,139 11.8 (7,411) -9.6 (454) (0.6)
Accounts Receivable -
Trade 37,969 6.4 3,960 12.0 (915) -2.4
Inventories, Net 20,051 3.4 1,786 8.0 3,994 19.9
Other Current Assets 10,079 1.7 (2,892) (21.6) 385 3.8
Total Current
Assets 279,690 47.1 18,560 6.5 24,949 8.9
Long-Term Investments 42,778 7.2 (7,032) -13.5 2,375 5.6
Property, Plant and
Equipment 681,123 114.7 32,918 4.5 85,977 12.6
Less: Accumulated
Depreciation (429,993) -72.4 (18,661) 3.9 (72,502) 16.9
Property, Plant and
Equipment, Net 251,130 42.3 14,257 5.7 13,475 5.4
Other Assets 20,145 3.4 2,878 14.3 2,892 14.4
Total Assets $593,743 100.0 $28,663 4.7 $43,691 7.4
LIABILITIES AND
SHAREHOLDERS' EQUITY
Current Liabilities
Short-Term Bank Loans $-- -- $20 24.4 $99 --
Accounts Payables 10,282 1.7 1,028 10.2 875 8.5
Payables to
Contractors and
Equipment Suppliers 17,214 2.9 7,916 87.1 (204) -1.2
Accrued Expenses and
Other Current
Liabilities 80,300 13.6 78,264 370.9 19,065 23.7
Current Portion of
Bonds Payable and
Long-Term liabilities 2,505 0.4 68 1.4 2,277 90.8
Total Current
Liabilities 110,301 18.6 87,296 193.5 22,112 20.0
Bonds Payable 17,000 2.9 -- 0.0 (4,500) -26.5
Other Long-Term
Liabilities 18,943 3.1 (766) (3.9) (294) (1.6)
Total Liabilities 146,244 24.6 86,530 112.3 17,318 11.8
Shareholders' Equity
Attributable to
Shareholders of the
Parent
Capital Stock 258,234 43.5 5,905 2.3 6,001 2.3
Capital Surplus 53,822 9.1 (505) (0.9) (96) -0.2
Retained Earnings 136,723 23.0 (61,953) (28.7) 17,287 12.6
Treasury Stock (918) -0.1 -- 0.0 -- --
Others (1,029) -0.2 (1,187) -116.3 862 -83.8
Total Equity
Attributable to
Shareholders of
the Parent 446,832 75.3 (57,740) (10.9) 24,054 5.4
Minority Interest 667 0.1 (127) (4.1) 2,319 347.7
Total Shareholders'
Equity 447,499 75.4 (57,867) (10.9) 26,373 5.9
Total Liabilities &
Shareholders' Equity $593,743 100.0 $28,663 4.7 $43,691 7.4
Note: (1) Amounts in New Taiwan dollars have been translated into
U.S. dollars at the rate of NT$32.735 as of June 30, 2007.
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED AND SUBSIDIARIES
Unaudited Consolidated Condensed Income Statements
For the Three Months Ended June 30, 2007, March 31, 2007,
and June 30, 2006
(Expressed in Millions of New Taiwan Dollars (NTD) and U.S. Dollars
(USD) (1)
Except for Per Share Amounts and Shares Outstanding)
Q2 2007 Q1 2007
USD NTD % NTD %
Net Sales $2,261 $74,918 100.0 $64,897 100.0
Cost of Sales (1,290) (42,738) -57.0 (40,287) -62.1
Gross Profit 971 32,180 43.0 24,610 37.9
Operating Expenses
Research and Development
Expenses (4) (130) (4,301) -5.7 (3,942) -6.1
General and Administrative
Expenses (4) (65) (2,151) -2.9 (1,902) -2.9
Sales and Marketing Expenses (4) (30) (994) -1.4 (889) -1.4
Total Operating Expenses (225) (7,446) -10.0 (6,733) -10.4
Income from Operations 746 24,734 33.0 17,877 27.5
Non-Operating Income, Net 85 2,802 3.7 1,830 2.8
Investment Gains 15 488 0.7 361 0.6
Income before Income Tax 846 28,024 37.4 20,068 30.9
Income Tax (Expenses) Benefits (73) (2,394) -3.2 (1,107) -1.7
Net Income Before Cumulative
Effect of Changes in Accounting
Principles 773 25,630 34.2 18,961 29.2
Cumulative Effect of Changes in
Accounting Principles (Net of
Tax) -- -- -- -- --
Net Income 773 25,630 34.2 18,961 29.2
Minority Interest (4) (146) -0.2 (122) -0.2
Net Income Attributable to
Shareholders of
the Parent 769 25,484 34.0 18,839 29.0
Earnings per Share - Diluted $0.03 $0.96 -- $0.71 --
Earnings per ADR - Diluted (2) $0.15 $4.82 -- $3.57 --
Weighted Average Outstanding
Shares - Diluted ('M) (3) -- 26,409 -- 26,406 --
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED AND SUBSIDIARIES
Unaudited Consolidated Condensed Income Statements
For the Three Months Ended June 30, 2007, March 31, 2007,
and June 30, 2006
(Expressed in Millions of New Taiwan Dollars (NTD) and U.S. Dollars
(USD) (1)
Except for Per Share Amounts and Shares Outstanding)
Q2 2006 QoQ YoY
NTD % Amount % Amount %
Net Sales $82,118 100.0 $10,021 15.4 ($7,200) -8.8
Cost of Sales (39,620) -48.2 (2,451) 6.1 (3,118) 7.9
Gross Profit 42,498 51.8 7,570 30.8 (10,318) -24.3
Operating Expenses
Research and Development
Expenses (4) (4,096) -5.0 (359) 9.1 (205) 5.0
General and
Administrative Expenses
(4) (2,086) -2.5 (249) 13.1 (65) 3.1
Sales and Marketing
Expenses (4) (993) -1.3 (105) 11.7 (1) 0.1
Total Operating Expenses (7,175) -8.8 (713) 10.6 (271) 3.8
Income from
Operations 35,323 43.0 6,857 38.4 (10,589) -30.0
Non-Operating Income, Net 299 0.4 972 53.1 2,503 835.4
Investment Gains 650 0.8 127 35.4 (162) -24.8
Income before Income Tax 36,272 44.2 7,956 39.6 (8,248) -22.7
Income Tax (Expenses)
Benefits (2,281) -2.8 (1,287) 116.2 (113) 5.0
Net Income Before
Cumulative Effect of
Changes in Accounting
Principles 33,991 41.4 6,669 35.2 (8,361) -24.6
Cumulative Effect of
Changes in Accounting
Principles (Net of Tax) -- -- -- -- -- --
Net Income 33,991 41.4 6,669 35.2 (8,361) -24.6
Minority Interest 11 0.0 (24) 19.9 (157) --
Net Income Attributable to
Shareholders of
the Parent 34,002 41.4 6,645 35.3 (8,518) -25.1
Earnings per Share -
Diluted $1.29 -- $0.25 35.3 -$0.32 -25.1
Earnings per ADR - Diluted
(2) $6.44 -- $1.26 35.3 -$1.62 -25.1
Weighted Average
Outstanding Shares -
Diluted ('M) (3) 26,394 -- -- -- -- --
Note:
(1) Amounts in New Taiwan dollars have been translated into U.S.
dollars at the weighted average rate of NTD33.142 for the second
quarter of 2007.
(2) 1 ADR equals 5 ordinary shares.
(3) Total diluted weighted average outstanding shares were 26,394M
shares for 2Q06 after the retroactive adjustments for stock dividends
and stock bonus.
(4) Certain prior period balances have been reclassified to conform to
the current period presentation.
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED AND SUBSIDIARIES
Audited Consolidated Condensed Income Statements
For the Six Months End June 30, 2007 and 2006
(Expressed in Millions of New Taiwan Dollars (NTD) and U.S. Dollars (USD)
(1)
Except for Per Share Amounts and Shares Outstanding)
For The Six Months Ended June 30
2007
USD NTD %
Net Sales $4,235 $139,815 100.0
Cost of Sales (2,515) (83,025) -59.4
Gross Profit 1,720 56,790 40.6
Operating Expenses
Research and Development Expenses (4) (250) (8,243) -5.9
General and Administrative Expenses(4) (123) (4,053) -2.9
Sales and Marketing Expenses (4) (56) (1,883) -1.3
Total Operating Expenses (429) (14,179) -10.1
Income from Operations 1,291 42,611 30.5
Non-Operating Income, Net 140 4,632 3.3
Investment Gains 26 849 0.6
Income before Income Tax 1,457 48,092 34.4
Income Tax (Expenses) Benefits (106) (3,501) -2.5
Net Income before Cumulative Effect
of Changes in Accounting Principles 1,351 44,591 31.9
Cumulative Effect of Changes in
Accounting Principles (Net of Tax) 0 0 0.0
Net Income 1,351 44,591 31.9
Minority Interest (9) (268) -0.2
Net Income Attributable to
Shareholders of the Parent 1,342 44,323 31.7
Earnings per Share - Diluted $0.05 $1.68 --
Earnings per ADR - Diluted (2) $0.25 $8.39 --
Weighted Average Outstanding Shares -
Diluted ('M) (3) -- 26,409 --
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED AND SUBSIDIARIES
Audited Consolidated Condensed Income Statements
For the Six Months End June 30, 2007 and 2006
(Expressed in Millions of New Taiwan Dollars (NTD) and U.S. Dollars (USD)
(1)
Except for Per Share Amounts and Shares Outstanding)
For The Six Months Ended June 30
2006 YoY
NTD % Amount %
Net Sales $159,968 100.0 ($20,153) -12.6
Cost of Sales (79,743) -49.8 (3,282) 4.1
Gross Profit 80,225 50.2 (23,435) -29.2
Operating Expenses
Research and Development
Expenses (4) (7,936) -5.0 (307) 3.9
General and Administrative
Expenses (4) (3,950) -2.5 (103) 2.6
Sales and Marketing Expenses (4) (2,114) -1.3 231 -10.9
Total Operating Expenses (14,000) -8.8 (179) 1.3
Income from Operations 66,225 41.4 (23,614) -35.7
Non-Operating Income, Net 1,716 1.1 2,916 170.0
Investment Gains 1,250 0.8 (401) -32.1
Income before Income Tax 69,191 43.3 (21,099) -30.5
Income Tax (Expenses) Benefits (4,136) -2.6 635 -15.3
Net Income before Cumulative
Effect of Changes in Accounting
Principles 65,055 40.7 (20,464) -31.5
Cumulative Effect of Changes in
Accounting Principles (Net of
Tax) 1,607 1.0 (1,607) 100.0
Net Income 66,662 41.7 (22,071) -33.1
Minority Interest (53) -0.1 (215) 403.9
Net Income Attributable to
Shareholders of the Parent 66,609 41.6 (22,286) -33.5
Earnings per Share - Diluted $2.52 -- -$0.85 -33.5
Earnings per ADR - Diluted (2) $12.62 -- -$4.23 -33.5
Weighted Average Outstanding
Shares - Diluted ('M) (3) 26,394 -- -- --
Note:
(1) Amounts in New Taiwan dollars have been translated into U.S. dollars
at the weighted average rate of NTD 33.015 for six months ended June
30, 2007.
(2) 1 ADR equals 5 ordinary shares.
(3) Total diluted weighted average outstanding shares were 26,394M shares
for the six months ended June 30, 2006 after the retroactive
adjustments for stock dividends and stock bonus.
(4) Certain prior period balances have been reclassified to conform to
the current period presentation.
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED AND SUBSIDIARIES
Consolidated Condensed Statements of Cash Flows
For the Six Months Ended June 30, 2007 and for the Three Months Ended
June 30, 2007, March 31, 2007, and June 30, 2006
(Expressed in Millions of New Taiwan Dollars (NTD) and U.S. Dollars
(USD)) (1)
Six Months 2007 2Q 2007 1Q 2007 2Q 2006
(Audited) (Unaudited)(Unaudited)(Unaudited)
USD NTD NTD NTD NTD
Cash Flows from
Operating
Activities:
Net Income $1,342 $44,323 $25,484 $18,839 $34,002
Net Income
Attributable to
Minority Interest 8 268 146 122 (11)
Depreciation &
Amortization 1,208 39,867 19,616 20,251 17,888
Deferred Income Tax (18) (601) 371 (972) 860
Equity in Earnings
of Equity Method
Investees, Net (26) (849) (488) (361) (650)
Changes in Working
Capital & Others (306) (10,119) (10,384) 265 (1,698)
Net Cash Provided
by Operating
Activities 2,208 72,889 34,745 38,144 50,391
Cash Flows from
Investing
Activities:
Acquisitions of:
Marketable
Financial
Instruments (910) (30,030) (14,234) (15,796) (39,850)
Investments
Accounted for
Using Equity
Method -- -- -- -- (48)
Property, Plant
and Equipment (1,190) (39,303) (25,345) (13,959) (21,391)
Financial Assets
Carried at Cost (13) (430) (218) (212) (168)
Proceeds from
Disposal or
maturity of:
Marketable
Financial
Instruments 1,492 49,272 30,013 19,259 32,075
Investments
Accounted for
Using Equity
Method -- -- -- -- --
Property, Plant
and Equipment -- 11 10 1 (215)
Financial Assets
Carried at Cost -- 14 0 14 --
Others (93) (3,101) (383) (2,717) (653)
Net Cash Used
In Investing
Activities (714) (23,567) (10,157) (13,410) (30,250)
Cash Flows from
Financing
Activities:
Increase (Decrease)
in Guarantee
Deposits (24) (806) (418) (388) 139
Proceeds from
Exercise of Stock
Options 9 297 175 122 209
Bonus Paid to
Directors and
Supervisors (9) (286) (286) -- (257)
Repayment of Long-
Term Bonds Payable (76) (2,500) -- (2,500) (2)
Cash Dividends Paid
for Common Stock -- -- -- -- --
Cash Bonus Paid to
Employees -- -- -- -- --
Others (1) (26) 2 (28) (15)
Net Cash Provided by
(Used in) Financing
Activities (101) (3,321) (527) (2,794) 74
Net Increase in Cash
and Cash Equivalents 1,393 46,001 24,061 21,940 20,215
Effect of Exchange
Rate Changes
and Others (13) (447) (944) 497 (14)
Cash and Cash
Equivalents at
Beginning of Period 3,569 117,837 140,274 117,837 121,251
Cash and Cash
Equivalents at
End of Period $4,949 $163,391 $163,391 $140,274 $141,452
Note: (1) Amounts in New Taiwan dollars have been translated into U.S.
dollars at the weighted average rate of NTD33.015 for the six
months ended June 30, 2007.
CONTACT
Elizabeth Sun / Harrison Hsueh / Julie Wei
Investor Relations Division
TSMC
Tel: +886-3-568-2085/ 2088/ 2086
Email:
Email Contact
Taiwan Semiconductor Manufacturing Company Limited
Web site:
http://www.tsmc.com/
http://www.tsmc.com/uploadfile/ir/quarterly/index_charts.pdf/