Recent Highlights
-- Chartered announced the extension of its joint development efforts with IBM to include 32nm bulk CMOS technology. The joint collaboration has enabled Chartered to accelerate its technology roadmap for leading-edge manufacturing solutions, spanning four major generations of advanced process technology, including 90nm, 65nm, 45nm and 32nm logic processes.
-- Chartered announced the re-denomination, from Singapore dollars to US dollars, of the terms of the call option it had entered into in March 2006. The modification results in the 2006 Option being denominated in the Company's functional currency.
Review and Outlook
"As we move into the second quarter, we are seeing resumption of growth across several of our customers and applications. Based on current demand levels from our customers, we are expecting wafer shipments to grow approximately 15 percent sequentially and translate to a utilization rate of approximately 77 % for the second quarter, an improvement of seven percentage points over the previous quarter. However, primarily as a result of lower shipment of 90nm wafers to the computer sector, we expect Chartered revenues and revenues including our share of SMP to be essentially flat sequentially," said Chia Song Hwee, President & CEO of Chartered.
The outlook for second quarter 2007 is as follows:
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1Q 2007 2Q 2007 Guidance
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Actual Midpoint and range Sequential change
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Revenues $323.8M $323M, +/- $6M Down 2% to Up 2%
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Revenues including
Chartered's share
of SMP $345.3M $345M, +/- $7M Down 2% to Up 2%
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ASP (a) $1,071 $922, +/- $20 Down 12% to Down 16%
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ASP including
Chartered's share
of SMP (a) $1,051 $914, +/- $25 Down 11% to Down 15%
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Utilization 70% 77%, +/- 3% -
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Gross profit (loss) $71.6M $67M, +/- $6M -
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Net income (loss)
(b) $5.3M $0M, +/- $5M -
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Basic earnings
(loss) per ADS (c) $0.01 $(0.01), +/- $0.02 -
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(a) Eight-inch equivalent wafers.
(b) Net income includes the negative profit impact from losses
attributable to minority interest, which was $4.3 million in first
quarter 2007, and is projected to be approximately $3.0 million in
second quarter 2007.
(c) Basic earnings (loss) per ADS is computed by deducting from net
income or adding to net (loss) the accretion to redemption value of
the convertible redeemable preference shares, projected to be
approximately $2.4 million in second quarter 2007.
CEO Closing Comments
"It is encouraging that wafer shipments are expected to see a double-digit sequential growth in the second quarter, indicating that the industry is on track for recovery. However, we do have the challenge of lower 90nm shipments to the computer sector, which dominated our leading-edge shipments in the past two quarters, impacting our revenue growth in the second quarter. Barring any severe macroeconomic issues which are difficult to predict, we continue to expect growth for the foundry industry in the second half of the year, driven primarily by seasonal strength as well as the continuing depletion of excess inventory across the semiconductor supply chain. We are executing slightly ahead of our schedule at 65nm and now expect to start commercial shipments in the second quarter. In the same quarter, we expect our revenue contribution from 65nm, including revenues from both SOI and bulk technologies, to be approximately five percent of our total business base revenues," said Chia.
Webcast Conference Call Today
Chartered will be discussing its first quarter 2007 and second quarter 2007 outlook on a conference call today, April 27, 2007, at 8:30 a.m. Singapore time (US time 5:30 p.m. PT/8:30 p.m. ET, Thursday, April 26, 2007). A webcast of the conference call will be available to all interested parties on Chartered's Web site at www.charteredsemi.com, under Investor Relations, or at http://ir.charteredsemi.com.
Mid-Quarter Guidance
The Company provides a guidance update midway through each quarter. For second quarter 2007, the Company anticipates issuing its mid-quarter guidance update, via news release, on Friday, June 8, 2007, Singapore time.
APPENDIX A
US GAAP Reconciliation Table
In order to provide investors additional information regarding the
company's financial results as determined in accordance with US GAAP,
in this report Chartered also provides information on its total
business base revenues, which include the Company's share of Silicon
Manufacturing Partners ("Revenues including Chartered's share of
SMP"). SMP is a minority-owned joint-venture company and under US
GAAP reporting, SMP revenues are not consolidated into Chartered's
revenues ("Revenues"). References to revenues including Chartered's
share of SMP in this report are therefore not in accordance with US
GAAP. To ensure clarity, the tables below provide a reconciliation.
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1Q 2006 4Q 2006 1Q 2007 2Q 2007
Actual Actual Actual Guidance
Midpoint
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Revenues (d) $355.2M $339.1M $323.8M $323M
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Chartered's share of SMP revenues $30.9M $24.6M $21.5M $22M
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Revenues including Chartered's
share of SMP $386.1M $363.7M $345.3M $345M
======================================================================
ASP (e) $1,089 $1,135 $1,071 $922
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ASP of Chartered's share of SMP
revenues (e) $992 $895 $817 $814
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ASP including Chartered's share
of SMP (e) $1,080 $1,115 $1,051 $914
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(d) Determined in accordance with US GAAP.
(e) Eight-inch equivalent wafers.
