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SMIC Reports Q4

SHANGHAI — Semiconductor Manufacturing International Corporation (NYSE: SMI; SEHK: 981) (“SMIC” or the “Company”), one of the leading semiconductor foundries in the world, today announced its consolidated results of operations for the three months ended December 31, 2010.

Fourth Quarter 2010 Highlights:

  • Revenue up by 0.4% to $411.8 million in 4Q10 from $410.1 million in 3Q10 and up by 23.6% compared to 4Q09.
  • Gross margin was 23.9% in 4Q10 compared to 24.5% in 3Q10 primarily due to an increase in other manufacturing costs.
  • Net cash flow from operations has increased to $248.6 million in 4Q10 from $125.2 million in 3Q10.
  • Income attributable to holders of ordinary shares was US$68.6 million in 4Q10, compared to income of US$30.4 million in 3Q10.
  • Diluted EPS was $0.13 per ADS.
  • First Quarter 2011 Guidance:

    The following statements are forward looking statements which are based on current expectation and which involve risks and uncertainties, some of which are set forth under “Safe Harbor Statements” below.

  • Revenue is expected to decline between 6% to 9%.
  • Gross margin is expected to range from 18% to 20%.
  • Operating expenses excluding foreign exchange differences are expected to range $82 million to $86 million.
  • 2011 capital expenditures to be around $1 billion.
  • Commenting on the quarterly results, Dr. David NK Wang, President and Chief Executive Officer of SMIC remarked, “2010 was a year of achievement for SMIC. First, I am pleased to report that SMIC continued to be profitable for the third consecutive quarter, and has achieved its first profitable year, at both operational and net income levels, after 5 years of loss. I would like to thank SMIC employees for their efforts, which resulted in enhanced customer relations, successful advanced technology ramp-up, and overall effective execution. Second, we recorded historical high annual revenue of more than $1.55 billion for 2010, representing a year-over-year growth of 45.2%. Fourth quarter gross margin of 24% exceeded our guidance. Thus we achieved 20% gross margin for the full year of 2010, which is the highest gross margin performance achieved since after the year of IPO. Furthermore, we received various awards in 2010, recognizing our high-level of performance and service as well as improvements; 5 of these came from our top 10 customers. We are gaining momentum in engaging with key customers on both legacy and advanced technology. All of this shows we have made significant progress compared to 12 months ago. We have confidence that our momentum will continue through 2011 and onwards.

    “In summary, we achieved a profitable 2010, successful 65-nanometer ramp up thus far, improved operations and overall customer relationships. We continue to focus on sustainable profitability for the long-term. In the near term we continue to ramp up 65/55-nanometer and to bring our 45/40-nanometer into production by the end of 2011. With our planned build up, we target to outgrow the foundry industry in 2011, and we look forward, with our strategy and execution to deliver sustainable value to our shareholders.”

    {complink 12815|Semiconductor Manufacturing International Corp. (SMIC)}

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