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To: PaulW who wrote (38495)	1/22/1999 3:09:00 PM
From: DiViT	Read Replies (3) \| Respond to of 50808

Taiwan chip giant predicts boom By Reuters Special to CNET News.com January 22, 1999, 9:00 a.m. PT The head of Taiwan's microchip powerhouse painted an upbeat picture for the semiconductor industry today, saying a boom cycle is coming after three sluggish years. Taiwan Semiconductor Manufacturing chairman Morris Chang said he expected more than 10 percent growth in the semiconductor industry worldwide following what he described as a "slaughter" of microchip prices from 1996 to 1998. "[This year] is going to be different. 1999 is very encouraging," Chang told a news conference. "That slaughter I think is over." The global semiconductor industry, which declined about 10 percent in 1998, has bottomed out and will enjoy healthy growth in 1999 and 2000, Chang said. He added 2001 was too far away to predict. Chang said he was equally optimistic about the prospects for Taiwan Semiconductor, a global leader in made-to-order "foundry" chipmaking. "I am just as optimistic about my company as what I say about the whole industry. I believe both revenue and earning will show growth from last year's levels," Chang said. Analysts concurred the semiconductor industry was bottoming out, but said a 10 percent growth may be too ambitious. "The semiconductor industry is definitely recovering and the future prospect, especially in 2000, looks great," said Nomura Securities' electronics analyst Chris Hsieh. SBC Warburg Dillon Read Securities' semiconductor analyst Tony Tseng said he expected zero percent growth for 1999 before a more dramatic rebound in 2000. "To use a fashionable term in the semiconductor industry, visibility is still not good," Tseng said. Preliminary results showed Taiwan Semiconductor's 1998 net profit stood at T$15.34 billion (US$477 million), a 14.6 percent decline compared to T$17.96 billion in 1997. Taiwan Semiconductor's full-year 1998 sales nonetheless rose 14.3 percent to T$50.233 billion, compared to T$43.936 billion in 1997. Chang said his firm's sales and profit in the first quarter will exceed those in the fourth quarter and capital spending would pick up rapidly later in 1999 and 2000 following the 1998 shrinkage. Chang said his recent sale of about 22 percent of his Taiwan Semiconductor equity stake was due to personal financial planning, rather than a lack of confidence.