Major tech firms turn in improved results

  • Business
  • Thursday, 30 Jan 2003

THREE of Singapore's biggest high-tech companies reported better-than-expected December quarter results yesterday but forecast challenging conditions ahead. 

State-controlled contract chipmaker Chartered Semiconductor Manufacturing Ltd and semiconductor testing and packaging company ST Assembly Test Services Ltd both narrowed their losses in the final quarter of 2002. 

The results, capping two years of trauma in the global computer chip market, came a day after the world's top contract maker of electronic chips, Taiwan Semiconductor Manufacturing Co (TSMC), posted a 43% slide in fourth-quarter net earnings. 

Chartered, which ranks a distant third behind TSMC and United Micro Electronics Corp in the global market for made-to-order chips, reported a fourth-quarter net loss of US$108.7mil, down from a loss of US$127.2mil in the year-ago period. Revenue, at US$107.9mil, was up 42% from a year earlier but down 17% on the third quarter. 

The company forecast weak demand for the first half of 2003, and said it planned to slash capital spending on new plant and equipment this year to about US$275mil, down from the already sharply reduced level of US$420mil in 2002. 

Computer audio equipment maker Creative Technology Ltd posted a smaller second-quarter profit on lower revenues from a year earlier, and said it would delist its shares from the Nasdaq exchange but keep them on the Singapore bourse. 

Net income of Creative in its second quarter, ended Dec 31, 2002, came in at US$18.9mil, compared with US$26.3mil a year earlier. Excluding items from its acquisition of 3Dlabs, Creative made a profit of US$23.3mil in the latest quarter. 

Revenues rose to US$230.9mil from US$249.5mil a year earlier. But Creative warned of a 26% to 35% slump in third-quarter sales as consumer spending remained sluggish. 

“We are concerned about the lagging economies in the US and Europe, and the uncertainty in the market caused by the Iraqi situation,” Craig McHugh, the president of Creative Labs Inc, the group's US unit, told analysts in a conference call. 

ST Assembly, part of the government-owned Singapore Technologies group, posted a smaller net loss of US$23.6mil for its 2002 fourth quarter compared with a loss of US$47mil a year earlier. 

The company, which has now posted two years of consecutive quarterly losses, saw net revenue rise 112% to US$71.9mil in the latest quarter from US$33.9mil in the final quarter of 2001, but still below the US$93mil peak in 2000. 

ST Assembly said it expected modest growth to continue into this year.  

“Based on current outlook, we expect revenues in the first quarter of 2003 to be about 5% higher than the fourth quarter (2002),” the company said in a statement. – Reuters  

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