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TSMC chairman expects better prospects in 2010

TSMC chairman expects better prospects in 2010

Taipei, Jan. 28 (CNA) The production value of the global semiconductor industry is expected to increase by 29 percent in 2010, the founding chairman of Taiwan Semiconductor Manufacturing Company Ltd. (TSMC) said Thursday.
The growth will be higher than the anticipated annual growth rate of 18 percent of the global semiconductor sector, Morris Chang added in his company's investor presentation.
Chang's prediction was seen as more optimistic than one made by the Industrial Technology Research Institute of the Industrial Economics and Knowledge Center, which anticipated that the industry's output in 2010 will grow by NT$661.82 billion (US$20.7 billion) , or 16.1 percent.
Chang also forecast that the worldwide personal computer market will expand by 14 percent in 2010, while an annual growth rate of 12 percent is expected in the cellphone market and a 7 percent annual growth rate in the consumer electronics market.
TSMC has assessed that its consolidated revenue will be between NT$89 billion (US$28.2 billion) aand NT$91 billion in the first quarter of the year, marking a quarterly drop of between 1.18 percent and 3.35 percent.
Chang attributed the predicted decline to the low season effect.
The Q1 gross margin is expected to be between 46.5 percent and 48.5 percent, while the operating margin for the quarter will be between 35 percent and 37 percent, TSMC predicted.
Due to strong demand outlook for advanced process technologies, the company's capital expenditure in 2010 will reach around NT$153.47 billion (US$4.8 billion) , registering a growth of nearly 80 percent from the previous year's NT$85.37 billion (US$2.67 billion) , according to TSMC, the world's largest contract semiconductor maker.
In the company's Q4 performance report released earlier in the day, TSMC solicited consolidated revenue of NT$92.09 billion, a net income of NT$32.67 billion and diluted earnings per share of NT$1.25 for the last quarter of 2009.
On a year-to-year basis, the Q4 revenue increased 42.6 percent while net income grew 162.5 percent and diluted EPS rose 162.7 percent, according to the report.
Gross margin for the quarter was 48.5 percent, the operating margin was 36.5 percent and the net margin was 35.5 percent, the report said.
The gains were attributed to a continued improvement in wafer sales with computer-related applications growing strongly and consumer-related applications declining seasonally, the report said.
(By Chang Chien-chung and Elizabeth Hsu)