Sat, Jun 15, 2013 - Page 13 News List

SPIL chairman expecting revenues to rise

By Lisa Wang  /  Staff reporter

Siliconware Precision Industries Co (SPIL, 矽品精密), the world’s No. 2 chip packager and tester, yesterday told shareholders that revenue is forecast to increase this year from last year.

Company chairman Bough Lin (林文伯) made the remarks in a letter to shareholders, adding that the expected growth would be driven by increased demand for the company’s advanced chip-packaging and testing services amid the growing popularity of smartphones, tablets and smart TVs.

The company expects to test and package 7 billion chips this year, up 18.64 percent from 5.9 billion chips last year, the company’s yearbook said.

Sales are expected to grow 6.91 percent this year to NT$69.13 billion (US$2.31 billion) from last year’s NT$64.66 billion, with the fastest growth in advanced testing and packaging services, JPMorgan Securities Ltd said in a report yesterday.

The company counts the nation’s largest handset chip designer, MediaTek Inc (聯發科) and the US-based Broadcom Inc and Nvidia Inc among its key customers, JPMorgan said.

“Our wirebonders [for chip packaging] are fully utilized now,” online news site quoted Lin as saying.

Utilization rates of its advanced Flip-Chip chip scale package (FCCSP) equipment and testing equipment are also high, he said.

Commenting on the overall semiconductor industry, Lin said: “[Revenue] in the second half of the year will grow compared with that of the first half ... as Apple and other companies launch new products.”

Increasing shipments of advanced 28-nanometer chips by Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s top contract chipmaker, shows evidence of an upturn in the semiconductor industry, Lin said. TSMC makes chips for Qualcomm, Nvidia and Broadcom.

In addition, strong demand for smartphones and tablets are boosting demand for chips and other high-tech components, he added.

“There are no indications of a slowdown in demand,” Lin said, dismissing recent speculation that a slowdown is to hit the sector later this year.

To cope with rising demand, the Greater Taichung-based company last month decided to raise its capital spending by 32 percent to NT$14.9 billion this year from its previous budget of NT$11.3 billion.

Yesterday, shareholders approved the company’s plan to distribute a NT$1.67 per share cash dividend based on last year’s net profits of NT$5.62 billion, or NT$1.83 per share.

That represented a 4.78 percent dividend yield after SPIL shares closed at NT$34.95 yesterday, down 0.43 percent from Thursday.

JPMorgan analyst Gokul Hariharan downgraded the company’s shares to “neutral” from “overweight,” saying the stock price has factored in stronger-than-expected growth. He also cut the stock’s target price to NT$35.1 from NT$42.

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