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Hoya to construct photomask facility

Flat-panel enterprise * Photomasks are plates made of glass on which circuitry patterns are burnt. * Hoya is building the plant in anticipation of increased demand by flat-panel display makers, which use photomasks to make LCDs. * Hoya's first-quarter net income was a record ?9.8bn.

Hoya Corp, the world's largest supplier of glass plates to the semiconductor industry, will build a new plant in Taiwan to make a component known as a photomask, which is used to produce liquid-crystal displays.

The plant is aimed at making photomasks for companies in Taiwan that are increasing flat-screen production and comes as Hoya's plant in western Japan runs at full capacity, with demand exceeding supply, Hoya spokesman Naoji Ito said in an interview.

Timing and financial details haven't been decided, Ito said.

Tokyo-based Hoya's move places the company's photomask operations closer to suppliers of personal computers and televisions as they replace bulky cathode-ray tube monitors with slimmer space-saving flat screens.

About 60 percent of the world's notebook computers are made in Taiwan and China.

"Flat-panel demand is strong," said Tetsuya Wadaki, an analyst at Nomura Securities Co. "Hoya is strengthening the business, and that's clearly a positive move."

Hoya says it has 60 percent of the market for LCD photomasks, which are used by companies such as South Korea's Samsung Electronics Co and Japan's Sharp Corp.

Photomasks are glass plates containing patterns of a microchip's circuitry, which are burnt onto a silicon wafer by shining light through the mask. In the case of LCDs, circuitry patterns are burnt onto glass.

Flat-panel sales are expected to grow at an annual rate of about 19 percent until 2007 as flat-screen TVs replace CRT models, according to market researcher DisplaySearch.

Last month, AU Optronics Corp (友達光電), the world's fourth-largest maker of flat-panel displays, said it will spend US$2.3 billion on a factory to produce television-sized LCDs. Samsung Electronics, the world's biggest LCD maker, also said last month it will increase spending on new LCD plants and equipment this year.

"Overall, demand is strong," Ito said. "Taiwanese companies especially are increasing spending to a greater extent than the Japanese and Koreans."

Optical devices for electronic products, a product category including glass plates for makers of semiconductors and LCDs, accounted for 47 percent of Hoya's sales in the fiscal first quarter ended June 30.

Hoya's first-quarter net income surged 43 percent to a record ¥9.8 billion (US$84 million), aided by higher sales to chipmakers.

Sales rose 4.4 percent to ¥63.9 billion compared with the year-ago period.
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