(OT) Genesis Microchip Comments On Impact of Taiwan Earthquake
TORONTO--(BUSINESS WIRE)--Sept. 28, 1999--Genesis Microchip (Nasdaq:GNSS) used today's annual shareholder meeting to answer questions about the impact of last week's earthquake in central Taiwan.
"First, we are deeply concerned about the people of Taiwan," said Paul M. Russo, Genesis Chairman and CEO. "We have a number of employees originally from Taiwan -- plus we have sales reps there -- and though our people are safe, we are worried about some of their family members."
The Sept. 21 earthquake and subsequent aftershocks have affected the entire fabless semiconductor industry, as has been widely reported by industry analysts and the media. The majority of Genesis's chip products are manufactured in Taiwan by UMC and TSMC.
"We believe there will be a temporary disruption in the supply of some of our products in the near term," said Russo, "which may adversely affect both the current (September) quarter as well as the December quarter. But we still expect the current (September) sequential revenue and earnings numbers to modestly exceed those of the previous (June) quarter."
Russo added a number of significant customers are located in Taiwan and they may delay receiving chip products because of issues at their own assembly lines. The company also believes the earthquake may delay some of the new Taiwanese LCD panel plants from coming online and producing LCD modules, which would continue to constrain the growth of the overall flat-panel LCD monitor market in the near term.
"The bottom line is, we believe there will be some short-term negative impact on our business as a result of the earthquake," Russo said. "But we don't anticipate these problems to affect business beyond 1999."
Statements in this press release discussing the potential impact of the Taiwanese earthquake on the business of the Company and its suppliers and customers, including statements about the Company's future financial results, contain "forward-looking" information within the meaning of the United States securities laws that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Specifically, the delay in the supply of the company's products may continue beyond the December quarter, revenue this quarter may not exceed the prior quarter, customers may delay receiving chip products longer than the company anticipates, the overall flat panel market may be constrained to a greater extent than the company now believes, and the company's business may be negatively impacted beyond 1999. Other risks and uncertainties that may negatively impact the company's business include, without limitation, the growth rate of the markets into which the Company sells its products; market acceptance of and demand for the products of the Company and those of the Company's customers; unanticipated delays or problems in the introduction of the Company's products; the Company's ability to introduce new products in accordance with OEM design requirements and design cycles; new product announcements or product introductions by the Company and the Company's competitors; availability and cost of manufacturing sources for the Company's products; supply constraints for components incorporated into the Company's customers' products; changes in the mix of sales to OEMs and distributors; incorrect forecasting of future revenues; the volume of orders that are received and can be filled in a quarter; the rescheduling or cancellation of orders by customers; costs associated with protecting the Company's intellectual property; changes in product mix; changes in product costs and pricing; and currency exchange rate fluctuations. These and other important risk factors are more fully detailed in the Company's SEC filings. Statements contained herein are made as of the date hereof and the company assumes no responsibility for updating such information.
Genesis Microchip Inc. (Nasdaq:GNSS) -- an ISO9001-registered company -- designs, produces and markets highly integrated semiconductors for flat panel displays, home theater equipment, projection systems, video workstation gear and dozens of other applications. You can find Genesis chips in products from Acer, Apple Computer, Daewoo, Dell, Fujitsu, IBM, In Focus Systems, Hitachi, LG Electronics, Mitsubishi, NEC, Philips, Samsung, SGI, Sharp, Sony, Tatung, ViewSonic and more than 200 other companies.
In May 1999, Genesis Microchip merged with Paradise Electronics to broaden its flat-panel enabling technology with Paradise's mixed-signal integrated circuits. Genesis is headquartered in Thornhill, Ontario, Canada, while its U.S. subsidiaries are located in San Jose and Mountain View, California. Further information is available at: genesis-microchip.com.
CONTACT:
Shelton Communications Group
Cathy Grittner/Vickie Gorton, 972/239-5119
or
Genesis Microchip Inc.
Eric Erdman, 905/889-5400
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