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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: robert b furman who wrote (201)	10/31/2001 2:48:55 PM
From: Proud_Infidel	Respond to of 25522

Bob, ReJust how do define bleeding edge equipment? or is that a freudian slip? LOL Re:Speaking of slipping - I sure let 33-ish slip out of my fingers And we all thank you:-) Brian

To: robert b furman who wrote (201)	11/1/2001 8:10:47 AM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Taiwan's DRAM Companies Incur Heavy Losses, Face Downgrade Pressure November 1, 2001 (TAIPEI) -- The spot price of the 128Mb DRAM chip fell below US$1 to rest at US$0.8, dashing hopes that the price will rebound in the fourth quarter of this year. Among Taiwan's DRAM companies that have compiled financial projections, Powerchip Semiconductor Corp. and ProMos Technologies Inc. have lowered their financial forecasts for the second time by widening full-year losses to NT$7.5 billion and NT$6.5 billion, respectively. Observers predict Nanya Technology Corp. and Vanguard International Semiconductor Corp. will follow suit before long. DRAM firms are expected to incur losses in excess of NT$5 billion, and possibly as high as NT$10 billion. Nanya Technology lost NT$7.5 billion during the first three quarters, meeting the adjusted losses target. Observers think it increasingly possible that the company will further cut its financial projection soon to expand full-year losses to NT$9 billion at least, second only to Mosel Vitelic Inc. Mosel Vitelic expects to lose more than NT$10 billion in 2001. Nanya Technology is expected to announce its second financial projection cut in November. Institutional investors are beginning to worry that mounting losses may put Nanya Technology in danger of a liquidity crunch. Nanya has responded by saying that the company will raise funds of NT$6 billion next year after receiving banks' syndicated loans of around NT$10 billion, in an attempt to scale up the company's cash position. In line with the 40 percent tumble in DRAM prices in the third quarter, local DRAM companies reported a steep drop in their financial results for the period. Vanguard said it lost NT$2.9 billion before tax, while its after-tax losses hit NT$4.95 billion, equivalent to NT$2.25 a share. As the after-tax losses in the first three quarters has reached 90 percent of the target of NT$5.5 billion in its first downwards-adjusted projection, Vanguard is expected to further scale down its operational goal in November. Powerchip Semiconductor lost NT$3.2 billion before tax, and NT$4.83 billion after tax, equivalent to losses per share of NT$2.12. Nanya Technology predicted year-to-September losses of NT$7.5 billion, after suffering a loss of NT$3 billion in the third quarter alone. ProMos Technologies estimated losses of NT$2.4 billion for the third quarter. After studying the performance of local DRAM firms, Taiwan Ratings Corp., the local affiliate of Standard & Poor's, warned that local DRAM companies would face tightening liquidity and might see their credit ratings downgraded before demand for chips recovers, unless the chip glut was resolved or leading DRAM companies opted out of the market. Taiwan Ratings used Mosel Vitelic as an example, noting that the company will face a crucial challenge next January and June if it fails to raise funds to pay off its maturing corporate bonds at that time. A high-level executive in the rating company said the success of DRAM companies depended on their expertise in research and development, their capacity for achieving economies of scale, their dominance in the market, and their strong capital structure. Taiwan's DRAM companies score indifferently in some of these respects. Most Taiwan DRAM companies lack the ability to conduct R&D on their own, and rely heavily on technology transfer from overseas chipmakers. The foundation on which local DRAM companies stand is so weak that a decision by their foreign partners to quit chip production would give them a heavy blow. Furthermore, compared with the 60 percent combined market share seized by Samsung Electronics Co., Ltd., Micron Technology Inc. and Hynix Semiconductor Inc., each local DRAM firm has an individual global share of less than 5 percent. Local DRAM companies also lack the sound balance sheets and adequate cash positions that give other chipmakers a reserve to enable them to weather the quick up-and-down cycles in the semiconductor industry. Taiwan Ratings warns that local DRAM companies will face a continuing cash drain if DRAM prices continue to fall. In particular, Mosel Vitelic is skating on thin ice, as its capital has been continuing to flow out, its maturing long-term debt amounts to NT$8.06 billion, and its corporate bonds will mature next January and June. (NT$34.50 = US$1) Related story: Contract 128Mb DRAM Price Drops Below US$1.50 (Commercial Times, Taiwan)