Losses at debt-laden Hynix widen

  • Business
  • Thursday, 14 Aug 2003

SEOUL: Hynix Semiconductor Inc reported yesterday a wider loss for its second quarter, hit by a slump in the price of its bread-and-butter memory chips used in computers, and repeated its commitment to shed non-core assets. 

Analysts are betting that the troubled South Korean company's performance bottomed out in the quarter, although they warned that its attempts to return to health had been put further in doubt due to stiff penalties from US and European Union (EU) authorities for alleged dumping. 

The EU decided on Tuesday to impose definitive anti-dumping duties of 34.8% on shipments of Hynix memory chips after the US Department of Commerce imposed a final import duty of almost 45% in June. 

Hynix, the world’s third largest maker of memory chips, incurred a loss of 527 billion won (US$447.3mil) for the three months ended June 30, compared with a loss of 417.6 billion won a year ago, according to Reuters calculations. Turnover was 778 billion won in the quarter, versus 777.7 billion previously. 

The company only released first-half figures. 

“Demand for DRAM (dynamic random access memory) chips during the second quarter was depressed due to the stagnant economic conditions caused by the Iraq war and the SARS outbreak in China,” Hynix said in a statement. 

Weak personal computer demand caused by the global economic slowdown had forced major chip producers to slash chip prices in the second quarter to push products out the door. 

Debt-laden Hynix has also been seeking to sell its non-memory chip operations to remain competitive.  

Non-memory chips account for some 20% of its total annual sales. – Reuters  

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