Hynix Semiconductor Inc lost 5 trillion won (US$3.8 billion) last year, a bigger-than-expected shortfall that may step up pressure on creditors to sell the world's third-biggest chipmaker to rival Micron Technology Inc.
The loss was 900 million won more than the 4.1 trillion won forecast by 19 analysts polled by IBES International Inc. Sales fell by half, to 4 trillion won from 8.9 trillion won, the company said in a statement.
PHOTO: AFP
Company officials said they expect a first-quarter net profit as chip prices rebound. Yet the unexpectedly large loss may prompt creditors, who provided two multibillion-dollar rescue packages last year, to accept Micron's latest offer, reported to be about US$4 billion.
"Hynix needs new money to invest in its technology if it is to survive on its own," said Lee Jae-hyun, who manages 100 billion won (US$76 million) at KEB Commerz Investment Trust Management. "I don't think creditors are willing to do that."
Chipmakers, including Micron, lost money last year when personal computer makers slashed orders for components as they suffered the first sales decline in history. The market for memory chips shrank by two-thirds to US$11 billion.
Hynix Chief Executive Officer Park Chong-sup said last month that the company would need 1 trillion won and more debt restructuring to survive if creditors rejected Micron's offer.
Creditors insisted the loss won't hamper efforts to secure an agreement with Micron. "It doesn't affect the negotiations," said Chung Hyung-ryang, head of corporate credit risk at Korea Exchange Bank.
Hynix, which last earned a profit in the third quarter of 2000, a year in which it lost 2.4 trillion won, said it earned 110 billion won in operating profit during the first two months of 2002. It didn't provide a net profit figure, however, or explain why operating profit rose.
Chief Operating Officer Sang Park said rising chip prices mean it will earn a profit this year. "If we achieve sales of 5 trillion won and chip prices stay above US$3.20, we won't have any cash-flow problems," he said.
Falling costs could also help: interest-bearing debt halved to 6.25 trillion won from 11.5 trillion won at the end of 2000, leaving Hynix with a debt-to-equity ratio of 126 percent.
Hynix earmarked 1.3 trillion won of capital spending for 2002, compared with 300 billion won in 2001, and 3 trillion won for 2003, Park said.
ROLLER-COASTER RIDE: More than five earthquakes ranging from magnitude 4.4 to 5.5 on the Richter scale shook eastern Taiwan in rapid succession yesterday afternoon Back-to-back weather fronts are forecast to hit Taiwan this week, resulting in rain across the nation in the coming days, the Central Weather Administration said yesterday, as it also warned residents in mountainous regions to be wary of landslides and rockfalls. As the first front approached, sporadic rainfall began in central and northern parts of Taiwan yesterday, the agency said, adding that rain is forecast to intensify in those regions today, while brief showers would also affect other parts of the nation. A second weather system is forecast to arrive on Thursday, bringing additional rain to the whole nation until Sunday, it
CONDITIONAL: The PRC imposes secret requirements that the funding it provides cannot be spent in states with diplomatic relations with Taiwan, Emma Reilly said China has been bribing UN officials to obtain “special benefits” and to block funding from countries that have diplomatic ties with Taiwan, a former UN employee told the British House of Commons on Tuesday. At a House of Commons Foreign Affairs Committee hearing into “international relations within the multilateral system,” former Office of the UN High Commissioner for Human Rights (OHCHR) employee Emma Reilly said in a written statement that “Beijing paid bribes to the two successive Presidents of the [UN] General Assembly” during the two-year negotiation of the Sustainable Development Goals. Another way China exercises influence within the UN Secretariat is
LANDSLIDES POSSIBLE: The agency advised the public to avoid visiting mountainous regions due to more expected aftershocks and rainfall from a series of weather fronts A series of earthquakes over the past few days were likely aftershocks of the April 3 earthquake in Hualien County, with further aftershocks to be expected for up to a year, the Central Weather Administration (CWA) said yesterday. Based on the nation’s experience after the quake on Sept. 21, 1999, more aftershocks are possible over the next six months to a year, the agency said. A total of 103 earthquakes of magnitude 4 on the local magnitude scale or higher hit Hualien County from 5:08pm on Monday to 10:27am yesterday, with 27 of them exceeding magnitude 5. They included two, of magnitude
Taiwan’s first drag queen to compete on the internationally acclaimed RuPaul’s Drag Race, Nymphia Wind (妮妃雅), was on Friday crowned the “Next Drag Superstar.” Dressed in a sparkling banana dress, Nymphia Wind swept onto the stage for the final, and stole the show. “Taiwan this is for you,” she said right after show host RuPaul announced her as the winner. “To those who feel like they don’t belong, just remember to live fearlessly and to live their truth,” she said on stage. One of the frontrunners for the past 15 episodes, the 28-year-old breezed through to the final after weeks of showcasing her unique