Net non-operating income during 2Q08 was NT$120 million. Gains on the disposal of investments were NT$524 million, including a gain from the sale of MediaTek shares for NT$414 million. Net investment losses were NT$575 million, which included a NT$731 million loss from valuation of ProMos shares. Net foreign exchange gains were NT$103 million, which include NT$36 from foreign exchange gains and NT$67 million from hedging gains.
Non-operating Income (Expenses)
(Amount: NT$ million) 2Q08 1Q08 2Q07
Net Non-operating Income (Exp.) 120 71 4,182
Net Interest Income (Expense) 160 116 349
Net Investment Income (Loss) (575) (278) 760
Gain on Disposal of Investment 524 652 2,634
Exchange Gain (Loss) 36 (718) (46)
Others (25) 299 485
Net cash outflow was NT$4.22 billion in 2Q08. Cash inflow from operations was NT$8.8 billion in 2Q08. The investing cash outflow primarily reflects the NT$2.49 billion of CAPEX in 2Q08. Free cash flow (Note 2) for 2Q08 was NT$6.31 billion. The NT$10.5 billion of financing cash outflow is mainly for the repayment of unsecured corporate bonds. Over the next 12 months, we expect to repay US$15 million in short-term loans.
Note 2: Free cash flow = Operating cash flow - Capital expenditures
Cash Flow Summary
For the 3-Month For the 3-Month
Period Ended Period Ended
(Amount: NT$ million) Jun. 30, 2008 Mar. 31, 2008
Cash Flow from Operations 8,799 9,455
Net Income (Loss) 2,397 206
Depreciation & Amortization 9,404 9,605
Changes in working capital (3,403) 314
Others 401 (670)
Cash Flow from Investing (2,489) (5,362)
Capital Expenditures (2,488) (5,685)
Others (1) 323
Cash Flow from Financing (10,503) (11,763)
Redemption of bonds (10,500) (12,217)
Others (3) 454
Effect of Exchange Rate (24) (148)
Net Cash Flow (4,217) (7,818)
Cash and cash equivalents decreased to NT$25.42 billion during 2Q08, which was mainly due to the cash outflow for capacity expansion and repayment of corporate bonds. The increase in notes and accounts receivable primarily reflected the upward trend of the business in 2Q08. The increase in inventory came from the increase of work-in-process wafers and finished goods.
Current Assets
(Amount: NT$ billion) 2Q08 1Q08 2Q07
Cash & Cash Equivalents 25.42 29.63 77.06
Notes & Accounts Receivable 14.79 12.78 14.15
Days Sales Outstanding 50 50 49
Inventory 12.31 11.09 10.91
Avg. Inventory Turnover 56 51 48
Total Current Assets 58.37 60.06 113.73
Total liabilities decreased to NT$36.48 billion in 2Q08. The decrease was primarily due to the NT$10.5 billion bonds repayment but offset by NT$9.38 billion of dividends payable. UMC's Debt to Equity ratio was 18% at the end of 2Q08.
Liabilities
(Amount: NT$ billion) 2Q08 1Q08 2Q07
Total Current Liabilities 25.22 26.92 54.92
Accounts Payable 4.62 4.50 4.96
Short-term Credit / Bonds 0.46 10.96 23.02
Others 20.14 11.46 26.94
Long-term Liabilities 7.54 7.50 7.49
Total Liabilities 36.48 38.02 66.01
Debt to Equity 18% 17% 23%
