Chartered delays Fab 7 ramp, plans to make it 300-mm in 2002

Chartered delays Fab 7 ramp, plans to make it 300-mm in 2002
SINGAPORE -- Chartered Semiconductor Manufacturing Pte. Ltd. today announced it was delaying the start up of its new Fab 7 here and reworking the plan to turn the facility into a 300-mm wafer fab instead of a 200-mm plant.

The 300-mm fab is now expected to begin pilot production in the middle of 2002, about a year later than the original 200-mm plan. Chartered also said it lowered its previous plans for capital spending and equity investments in joint ventures by 20% to $1.2 billion in 2001 because of slower growth in silicon foundry demand. However, the planned investments are still higher than Chartered's $911 million expenditures in 2000.

Chartered, the world's third largest pure-play silicon foundry, lowered its near-term growth outlook after posting record revenues of $318.7 million in the fourth quarter. Those revenues were 4% higher than $305.6 million in the third quarter of 2000 but 47.4% greater than $216.2 million in Q4 1999. Chartered's Q4 net income was $77.4 million vs. $22.1 million in the period a year ago and $71.6 million in Q3 of 2000.

The Singapore foundry company said it is now setting its operating plans for 2001 "on a considerably more cautious outlook" compared to its previous guidance for investors last year. Chartered said it expects foundry revenues to be depressed in the first half of 2001 as customers adjust inventory levels, with growth resuming in the third and fourth quarter this year.

For 2001, Chartered is projecting revenue growth of 12-18% from 2000, which the company's sales reached $1.13 billion--a 63.4% increase from $694.3 million in 1999. The company's net income for 2000 was $244.8 million vs. a net loss of $32.6 million in 1999.

Chartered said it is expecting an average utilization of fab capacity this year to in the mid-80 percentage range, compared to 102% in 2000. Including its lower capital spending plans, Chartered's capacity level in 2001 is expected to be 25% higher than 2000.

Until recently, Chartered officials were planning to increase the company's production capacity by 44% in 2001 to 1.4 million eight-inch equivalent wafers from 926,700 in 2000. Chartered shipped 695,300 processed wafers in 1999.

Chartered said it shipped 244,300 eight-inch equivalent eight-inch wafers in the fourth quarter of 2000, an increase of 27.8% from 191,200 in Q4 of 1999. The average selling price of processed wafers grew 18% to $1,304 in the fourth quarter from $1,108 in Q4 1999 (excluding the terminated print-head business), Chartered said.

In the fourth quarter, Chartered's capacity utilization was 94% vs. 104% in the period a year ago and 103% in the third quarter of 2000.