12/06 21:22
Chartered May Stick to Forecast in Mid-Quarter Report Card
By Linus Chua
quote.bloomberg.com
Singapore, Dec. 7 (Bloomberg) -- Chartered Semiconductor Manufacturing Ltd. may paint a brighter outlook on business when it provides an update for the fourth-quarter next week, although its forecast of a loss isn't expected to change, investors said.
The third-largest maker of chips to other companies' designs is expected to stick to an October estimate of a loss of 95 cents to 97 cents on each American depositary receipt for the three months ending Dec. 31, investors say. Chartered will provide the update on Wednesday through a news release.
Chartered's outlook is crucial to many investors who want an idea of how sales are doing, and how much of production equipment is in use. Prospects of more orders helped Chartered shares gain more than 40 percent in two months, making them the fourth-best performer on Singapore's benchmark Straits Times Index.
``Investors are predicting Chartered will have some good news for them but we can't be too aggressive after the magnitude of the gain,'' said Ian Lui, the chief investment officer of Allianz Asset Management Co. in Singapore, who manages S$1 billion in stocks, including Chartered shares. ``The outlook may be more optimistic, but to what extent, no one knows.''
Still, some investors are betting that the slump in the semiconductor business this year, which manufacturers say is the worst in the industry's history, may have ended.
Yesterday, Intel Corp. boosted its forecast for fourth- quarter sales, as stronger-than-expected holiday buying lifts demand for the biggest computer-chipmaker's newest Pentium 4 processors. Intel buys chips from Chartered.
Intel's rival Advanced Micro Devices Inc. also raised its forecast for fourth-quarter sales and reiterated it will return to profit in the second quarter of next year. Sales of AMD's new Athlon XP processor, introduced on Oct. 9, have been ``robust,'' the company said.
Semiconductor Sales
Worldwide chip sales are expected to fall 31 percent this year to $141 million. In 2002, revenue may expand 6.3 percent, followed by a 21 percent surge in each of the next two years, the Semiconductor Industry Association said this week.
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