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United States
Securities and Exchange Commission
Washington, D.C. 20549
Form 6-K
Report of Foreign Private Issuer Pursuant to Rule
13a-16 or 15d-16 of the Securities Exchange Act of 1934
For the quarter ended December 31, 1999
Commission File Number 000-27811
CHARTERED SEMICONDUCTOR MANUFACTURING LTD
(Exact name of registrant as specified in its charter)
Not Applicable
(Translation of registrant's name into English)
Republic of Singapore
(Jurisdiction of incorporation or organization)
60 Woodlands Industrial Park D
Street 2, Singapore 738406
(65) 362-2838
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
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Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
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If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b). Not applicable.
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TABLE OF CONTENTS:
1. Other Events
On January 21, 2000 in Singapore, the Company announced its earnings for
the fourth quarter and year ended December 31, 1999. A copy of the Company's
press release dated January 21, 2000, is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
2. Exhibits
99.1 Press release of the Company dated January 21, 2000.
2
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunder duly organized.
Date: January 24, 2000
CHARTERED SEMICONDUCTOR
MANUFACTURING LTD
By: /s/ CHIA SONG HWEE
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Name: Chia Song Hwee
Title: Chief Financial Officer
S-1
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EXHIBIT INDEX
99.1 Press release of the Company dated January 21, 2000.
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FOR IMMEDIATE RELEASE
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CONTACTS:
MEDIA INVESTORS
Rita Srinivasan Larry James
65.360.4368 1.408.941.1110
[email protected] [email protected]
Maggie Tan Barbara Kalkis
65.360.4705 Maestro Public Relations
[email protected] 1.408.996.9975
[email protected]
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CHARTERED SEMICONDUCTOR REPORTS RECORD REVENUES IN
1999 YEAR-END RESULTS
FOURTH QUARTER RESULTS MARK RETURN TO PROFITABILITY
ADDITION OF CAPACITY WILL BE ACCELERATED TO ACCOMMODATE SURGE IN WAFER DEMAND
SINGAPORE -- JANUARY 21, 2000 -- Chartered Semiconductor Manufacturing
(Nasdaq:CHRT and SGX:CHARTERED) has announced record net revenues for its fiscal
year ended December 31, 1999, and significant net revenue growth for its fourth
quarter. The Company reported annual net revenues of $694.3 million for 1999, an
increase of 64% over annual net revenues of $422.6 million reported for 1998.
Fourth-quarter net revenues were $216.2 million, up 104% from $106.0 million in
net revenues from the same quarter a year ago. Net revenues, including our share
of the minority-owned joint-venture company, were $707.6 million for 1999 and
$228.9 million for the fourth-quarter 1999, resulting in growth rates of 67%
year-over-year and 116% quarter-over-quarter.
The 1999 earnings per American Depositary Share (ADS) and earnings per share
(EPS) on a fully diluted basis were a loss of $0.32 and a loss of $0.03
respectively, compared with a loss of $2.42 and a loss of $0.24 respectively in
1998. The fourth-quarter 1999 earnings per ADS and EPS on a fully diluted basis
were $0.18 and $0.02 respectively, compared with a loss of $0.78 and a loss of
$0.08 respectively in the same quarter a year ago.
Fourth-quarter 1999 net income of $22.1 million (which included a non-cash
stock-based compensation charge of $8.0 million and several fourth-quarter items
totaling a credit of $10.2 million) reflected an improvement of $99.2 million
from negative $77.2 million in the fourth-quarter 1998. For the fourth-quarter
1999, higher volume of shipments, improved utilization of capacity and
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higher average selling prices drove the gross profit to $71.4 million, or 33% of
net revenue, from a negative $6.4 million, or negative 6% of net revenue in the
same quarter a year ago. The fourth-quarter 1998 net loss included a $31.8
million charge associated with the termination of a development program and a
non-cash stock-based compensation credit of $0.7 million.
Net loss for 1999 was $32.6 million, an improvement of $166.2 million over 1998.
As a result of higher volume of shipments and improved capacity utilization,
gross profit for 1999 improved to $167.2 million, or 24% of net revenue, from
negative $17.0 million, or negative 4% of net revenue, in 1998. The 1999 net
loss included a $20.1 million non-cash stock-based compensation charge and a
$6.5 million charge associated with the termination of a development program.
The 1998 net loss included a $31.8 million charge associated with the
termination of a development program and a $2.8 million non-cash stock-based
compensation credit.
In 1999, the Company increased its research and development (R&D) investment by
36% to $58.9 million due principally to expenses for the development of 0.25um
and 0.18um process technologies, as well as other advanced processes.
Regional Market Dynamics
The addition of new customers in Europe marked the region as the Company's
fastest growing geographical sales area. Together with increased wafer demand in
the United States -- the Company's largest region -- Chartered's
quarter-over-quarter and year-over-year performance saw significant growth.
Including our share of the minority-owned joint-venture company, 1999 revenues
in Europe totaled $95.2 million, versus 1998 revenues of $6.9 million; North
America revenues totaled $484.5 million in 1999, while 1998 revenues for the
region totaled $265.4 million. In Japan, 1999 revenues rose to $20.3 million
from $5.0 million in 1998. The Asia-Pacific region saw a reduction in revenues
to $107.6 million in 1999 from $145.3 million in 1998. The lower revenue in
Asia-Pacific reflects the Company's strategic shift away from commodity chips to
a sharper focus on systems-level technologies and communications market
requirements.
"We believe our strategy to support industry innovators requiring systems-level
solutions and our focus on specific market segments are responsible for our
overall revenue growth," said Barry Waite, president and CEO of Chartered. "This
strategy manifested itself most notably in Europe with its high concentration of
companies with communications and systems expertise."
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Average Selling Prices and Wafer Demand
Average selling prices (ASPs) also showed marked improvement in the
fourth-quarter 1999 as the Company was able to increase shipments of wafers with
a higher mix of advanced technology. Average selling prices increased 37% from
$825 per wafer in the fourth-quarter 1998 to $1131 per wafer in the
fourth-quarter 1999. Average selling prices increased by 4% from $961 per wafer
in 1998 to $999 per wafer in 1999. Adjusted to exclude the terminated print-head
business, ASPs increased 26% from the fourth quarter of 1998 to the fourth
quarter of 1999 and 2% from 1998 to 1999.
The combined factors of new customers and increased wafer demand spurred wafer
shipments from 439,700 in 1998 to 695,300 wafers in 1999, an increase of 255,600
or 58%. Wafer shipments in the fourth quarter totaled 191,200 -- an increase of
62,700 wafers, or 49%, over shipments of 128,500 in the same period a year ago.
Capacity Ramp Acceleration
Based on the current semiconductor market outlook and customer demand for
Chartered's services, the Company intends to double manufacturing capacity from
approximately 700,000 wafers per year to 1.4 million wafers by the end of 2001.
The accelerated capacity plan involves a two-phased approach that is intended to
provide ongoing additional capacity expansion. First, the Company plans to
increase capacity within its existing production facilities. The existing
clean-room in Fab 2 will be expanded and the subfloor areas in Fab 1 and Fab 3
will be converted into manufacturing floors. The expected increased efficiencies
realized by maximizing current space utilization will result in the capability
to produce approximately 20,000 additional eight-inch wafers per month -- about
the same output of some fabrication facilities. Capacity in year 2000 is
expected to be approximately 970,000 eight-inch equivalent wafers.
During the 2000 fiscal year, Chartered plans to break ground for the
construction of a new eight-inch wafer fabrication facility. The new facility is
expected to have a production capacity of approximately 60,000 eight-inch wafers
per month and is expected to be capable of fabricating wafers with 0.15um and
smaller process geometries. The cost of construction and equipment in the new
facility is currently estimated at approximately $2.1 billion. First wafer
output at the new facility is expected to occur in mid-2001.
To support its plan for accelerated capacity growth, the Company has raised its
year 2000 estimate of total capital expenditures for itself and its
joint-venture fabrication facilities to approximately $1.4 billion. This
represents an increase of 102% over its 1999 capital expenditures.
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Summarizing highlights of the year, Barry Waite said, "Chartered has established
itself as a top-tier foundry through its focus on systems-level technologies
supporting industry innovators. Going forward, our customers and partners have
high expectations of Chartered's support capabilities. Our results show that we
are making solid steps in the right direction. We will continue to invest in
technology, capacity and the right skills to enhance Chartered's role as a
long-term, premier pure-play foundry."
ABOUT CHARTERED
Chartered Semiconductor Manufacturing (Nasdaq:CHRT and SGX:CHARTERED) is one of
the world's leading independent foundries providing wafer fabrication services.
Guided by the tenets of trust, service, partnership, advanced technology and
stability, the Company aims to provide world-class semiconductor foundry
services that enable customers to create and deliver market-leading system-level
solutions. Chartered operates five fabrication facilities that serve
high-growth, technologically advanced applications such as communications and
networking. Headquartered in Singapore, Chartered employs approximately 3800
people at its 12 locations in North America, Asia and Europe.
Chartered completed its global initial public offering in October 1999 and is
traded in the United States on Nasdaq and in Singapore on the Singapore Exchange
(SGX). The Company reported 1999 revenues of US $694.3 million.
For more information, visit the company's website, www.charteredsemi.com.
Investor updates can be viewed at www.charteredsemi.com/investor.htm.
This news release contains forward-looking statements, as defined in the safe
harbor provisions of the United States Private Securities Litigation Reform Act
of 1995. These forward-looking statements -- including without limitation
statements relating to capacity acceleration, capital expenditures, and the
construction of a new facility more particularly described under the heading
"Capacity Ramp Acceleration" -- reflect the Company's current views with respect
to future events and financial performance. These statements are subject to
certain risks and uncertainties, which could cause actual results to differ
materially from historical results or those anticipated. For example, changes in
the market outlook, customer demand, delays in the delivery of equipment and
regulatory issues could affect our capacity acceleration plans, including the
construction of the new facility. Although the Company believes the expectations
reflected in such forward-looking statements are based upon reasonable
assumptions, it can give no assurance that its expectations will be attained. In
addition, a description of certain other risks and uncertainties which could
cause actual results to differ materially from those indicated in the
forward-looking statements can be found in the section captioned "Risk Factors"
in the Company's prospectus dated October 29, 1999. The Company undertakes no
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
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CHARTERED SEMICONDUCTOR MANUFACTURING LTD
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS OF US DOLLARS, EXCEPT PER SHARE DATA)
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<CAPTION>
Three Months Ended Twelve Months Ended
December 31, December 31,
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1998 1999 1998 1999
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(unaudited) (unaudited) (audited) (unaudited)
<S> <C> <C> <C> <C>
Net revenue 105,969 216,233 422,622 694,258
Cost of revenue 112,363 144,849 439,668 527,023
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Gross profit (loss) (6,394) 71,384 (17,046) 167,235
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Operating expenses:
Research and development 9,495 22,433 43,419 58,894
Fab start-up costs - 8,442 1,455 8,442
Sales and marketing 9,451 4,622 31,872 34,359
General and administrative 14,523 12,143 37,389 44,619
Costs incurred on termination of development
program 31,776 - 31,776 6,500
Stock-based compensation (723) 7,956 (2,780) 20,094
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Total operating expenses 64,522 55,596 143,131 172,908
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Operating income (loss) (70,916) 15,788 (160,177) (5,673)
Other income (expense) (5,989) 893 (28,964) (32,298)
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Income (loss) before income taxes (76,905) 16,681 (189,141) (37,971)
Income tax benefit (expense) (245) (2,092) (865) (2,131)
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Income (loss) before minority interest (77,150) 14,589 (190,006) (40,102)
Minority interest - 7,483 - 7,483
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Net income (loss) (77,150) 22,072 (190,006) (32,619)
Other comprehensive income (loss) - - (8,794) -
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Comprehensive income (loss) (77,150) 22,072 (198,800) (32,619)
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Net income (loss) per ordinary share:
Basic (0.08) 0.02 (0.24) (0.03)
Diluted (0.08) 0.02 (0.24) (0.03)
Shares used in per share calculation (in millions)
Basic 985 1,182 785 1,035
Diluted 985 1,217 785 1,035
Net income (loss) per ADS:
Basic (0.78) 0.19 (2.42) (0.32)
Diluted (0.78) 0.18 (2.42) (0.32)
ADSs used in per share calculation (in millions)
Basic 98 118 78 104
Diluted 98 122 78 104
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CHARTERED SEMICONDUCTOR MANUFACTURING LTD
CONSOLIDATED BALANCE SHEET
(IN THOUSANDS US DOLLARS, EXCEPT PER SHARE DATA)
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<CAPTION>
As of
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December 31, December 31,
1998 1999
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(audited) (unaudited)
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Assets
Cash and cash equivalent 99,619 544,996
Accounts receivable 83,988 141,226
Inventories 29,476 33,619
Other current assets 10,149 9,946
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Total current assets 223,232 729,787
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Property, plant and equipment, net 981,970 1,282,106
Other non-current assets 116,308 121,015
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Total assets 1,321,510 2,132,908
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LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable 31,359 152,401
Current installments of long-term debt 49,046 119,991
Bank overdrafts 3,082 -
Accrued operating expenses 84,918 127,147
Other current liabilities 41,728 35,686
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Total current liabilities 210,133 435,225
Obligations under capital leases, excluding
current installments 13,414 7,822
Long-term debt, excluding current installments 419,545 423,668
Other liabilities 77,172 67,279
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Total liabilities 720,264 933,994
Minority interest - 57,164
Shareholder's equity 601,246 1,141,750
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Total liabilities and shareholders' equity 1,321,510 2,132,908
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