Startling News about Korea!
A quote from Bob Akins during the Cymer cc:
(transcript by ScottMcI on MF, a tip of the hat for his hard work)
<<Akins: Ok, well you've probably seen some of the same reports that we have, and while we were at SEMICON Korea we certainly got more and more input that there are numerous very serious negotiations going on between Korean chipmakers and tool suppliers - all tool suppliers - including the lithography tool suppliers. So the main issue now is how can they continue to take delivery of tools that they need and not necessarily have to pay for them
instantaneously. And I think that that's a very interesting subject.>>
<<* In reality, the delivery of those tools and shipments have never stopped*>>
<<It has been continuing on its original trajectory and there is no deviation from that. But the terms and conditions associated with those deliveries will be changing, and it opens up a new area of competitiveness, obviously, and market share battle between in this case the stepper manufacturers.>>
OH HO! I have no reason to think that Akins is stating anything except complete truth, and, if so, it changes the entire Asian scenario. You'd need to be very careful to consider how a company, which is delivering product to Korea right now, is treating receivables on its earnings statement. This clearly leverages the future impact of the Korean economy on the earnings of such businesses. In other words, it will increase the effect of Korea's solvency on earnings.
Anyone who's doing this is lending money to companies that can't meet their current operating obligations. If "delivery . . . is continuing in its original trajectory" is accurate, it means no slowdown in deliveries to Korea, which means these folks aren't taking Korean sales off the books, as everyone has assumed. Rather, sales to Korea are actually GROWING right now. The companies are in a "double-or-nothing" mode. Either their earnings are still actually increasing, or else they are going to show a double loss by delivering product which won't ever be paid-for.
So you'd have to think that semi equipment issues are going to be horrendously volatile, moreso than currently anticipated, based on whether or not the Korean (and to a smaller degree other Asian) economy recovers as hoped this year. A good recovery will send these stocks through the roof. Another round of bad news and it's going to be worse than presently anticipated.
I haven't seen a WORD about this anywhere else, certainly not from analysts, who treat their projections as if semi equip. co's with Korean exposure are just going to lose 50% of their Korean revenues this year.
Also in the conference call, Akins said that practically the only operating DUV scanners are in Japanese companies right now. This would seem to bode well for the future of the big Japanese semi's, all of which are taking enormous earnings hits right now. |
