Sat, Jul 19, 2003 - Page 11 News List

ProMOS expects profit by year's end

BLOOMBERG

ProMOS Technologies Inc's (茂德科技) second-quarter loss narrowed by two-thirds, prompting the nation's No. 2 maker of computer-memory chips to forecast profit for the remainder of the year as prices improve.

ProMOS's net loss in the three months ended June 30 narrowed to NT$492 million (US$14 million), derived by subtracting first-quarter from first-half earnings released by the company, a venture between Germany's Infineon Technologies AG and Mosel Vitelic Inc (茂矽).

Increasing output at a new factory that uses Infineon technology are expected to help end two quarters of losses as demand for personal computers improves, ProMOS said.

The company and Munich-based Infineon were the first to build plants that make 12-inch wafers, which more than double the number of chips that can be made from standard wafers and may trim costs by a third.

"ProMOS's 12-inch plant is one of the most advanced in the world," said Johnny Lin, an analyst with Yuanta Core Pacific Securities (元大京華證券).

ProMOS also is getting a 30 percent premium on new chips that few rivals can make, he said.

ProMOS's new factory is operating profitably, company vice president Albert Lin (林育中) said yesterday.

The company is one of the first to make so-called DDR400 memory chips, which help speed the operation of PCs powered by new semiconductors introduced earlier this year by Intel Corp, the world's biggest chipmaker.

ProMOS shares rose NT$1, or 6.2 percent, to NT$17.20 on the TAIEX yesterday, bringing the stock's gain this year to 79 percent.

Shares of Nanya Technology Corp (南亞科技), ProMOS's larger rival, dropped NT$0.20, or 0.7 percent, to NT$27.20.

The spot price of the benchmark 256-megabit, 266-megahertz double-data-rate dynamic random-access memory chip rose to US$4.30 yesterday from US$3.61 on June 30, according to Dramexchange.com, an online marketplace for the semiconductors in Taipei.

Many analysts say US$4 is the break-even point for most makers.

"If prices can stay above US$4, all the suppliers in Taiwan should make profits in the second half," Johnny Lin said.

The price is still less than half the peak of US$8.88 on Nov. 4. ProMOS last posted a quarterly profit in the fourth quarter.

For the first half of this year, ProMOS said it had a net loss of NT$1.5 billion, without providing a year-ago comparison.

The company said in its e-mail statement the loss was less than the NT$2 billion it expected.

"The general economic situation is better than it was last year," Albert Lin said.

ProMOS had a loss of NT$1.4 billion in the second quarter of last year.

Mosel, whose chairman Hu Hung-chiu (胡洪九) is also chairman of ProMOS, yesterday said last year's net loss narrowed by a fifth to NT$15.3 billion from NT$19.8 billion in 2001.

Trading of the company's shares was halted in May after it failed to report last year's and this year's first-quarter results on time. The company still hasn't posted results for the first quarter.

This story has been viewed 3060 times.
TOP top