Chartered: Sales slip sequentially, sees weaker 3Q

July 21, 2006 – Singapore foundry Chartered Semiconductor Manufacturing said revenues were $364.8 million, up 88% in 2Q06 compared with a year ago, and up about 3% from the prior quarter, helped by “significant growth in the consumer sector.” Net income totaled $12.3 million, down from $25.3 million in 1Q06 but reversing a $67.1 million loss in 2Q05.

Wafer shipments in 2Q06 rose 2.7% from the prior quarter to 327,000 wafers, a 60.4% increase from a year ago. Average selling price was $1089/wafer, flat with the first quarter. Capacity utilization also was the same as 1Q06 (82%), and much higher than the same period a year ago (65%).

For 3Q06, Chartered projects revenues flat to slightly down, in a range of $356-$368 million, and profits of $6-$16 million. Utilization rates are expected to slow down slightly as well, to 75%, with a 5% increase in overall capacity.

The foundry sees weakness in the third quarter, with customers concerned about inventories due to softer-than-usual seasonality in end markets, although the company said that weakness would be partially offset by new business, such as the ramp of AMD’s newest microprocessors. “We do see the general market weakness slowing our overall growth plan for this year,” noted Chia Song Hwee, president and CEO of Chartered. Revenues are expected to be flat with 2Q, because of softness in the consumer sector, primarily due to a decline in revenues from video game devices, noted George Thomas, SVP and CFO.


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