Fri, Sep 25, 2015 - Page 13 News List

GlobalWafers foresees tough fourth quarter

By Lisa Wang  /  Staff reporter, in HSINCHU

GlobalWafers Co Ltd (環球晶圓), the world’s sixth-largest silicon wafer supplier, said that next quarter would be a tougher-than-expected period as uncertainty about the macroeconomy continues to weigh on consumer spending on electronics.

Consumers are tightening their purse strings amid speculation that the US Federal Reserve could raise key interest rates by the end of this year, even though the Feb kept its rates at a record low at a policy meeting earlier this month, the company said.

“We only saw a few early orders from customers in the DRAM and automotive segments. Originally we thought other customers would follow suit, but that did not happen,” GlobalWaters chairperson Doris Hsu (徐秀蘭) told a media briefing on the eve of the company’s debut on the Taipei Exchange today at a price of NT$61.5 per share.

A month ago, customers had indicated that they would place orders earlier than usual, helping GlobalWafers to better weather the weak fourth quarter, Hsu said.

“Now, customers are much more cautious [about ordering] for the fourth quarter. Economic uncertainty remains,” Hsu said. “Some [customers] have postponed shipments as softer-than-expected end demand has caused inventory to be slightly above [normal levels].”

GlobalWafers’ customers include Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), United Microelectronics Co (UMC, 聯電), Infineon Technologies AG and Micron Technology Inc.

The company expects the correction to be brief. It would take about one quarter for customers to adjust their inventory, paving the way for a recovery in the first quarter of next year, Hsu said.

For GlobalWafers, the impact from the industry slowdown would be relatively minor due to its broad product lineup, she said.

Analysts’ revenue forecasts of NT$15 billion (US$451 million) this year would be fair and achievable, Hsu said.

The company posted revenue of NT$15.55 billion last year.

Factory utilization at its 8-inch and 12-inch wafer fabs would bet more than 90 percent next quarter, while production lines for smaller wafer manufacturing would be at about 80 percent, she said.

Average selling prices would be little changed next quarter, she said.

Hsu said GlobalWafers is seeking merger-and-acquisition targets to expand its technology portfolio and to expand capacity.

“Our factory utilization has been running at a very high level, which will limit our future growth,” Hsu said.

The firm would seek to solve the problem either via mergers and acquisitions, or by building a new 12-inch plant next year, she said.

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