Vanguard International Semiconductor Corp (世界先進), a supplier of power management chips, yesterday raised its capital expenditure for this year by 70 percent to NT$8.5 billion (US$304.09 million), as it prepared early for next year’s capacity expansion because of longer equipment delivery times.
The Hsinchu-based chipmaker initially planned to spend NT$5 billion on new facilities and equipment this year, up 41 percent from last year’s capital expenditure of NT$3.45 billion.
The upgraded capital spending does not include the purchase of an older fab from AU Optronics Corp (AUO, 友達光電) for NT$905 million, Vanguard said, adding that the fab has a monthly capacity of 40,000 8-inch wafers.
Photo: Grace Hung, Taipei Times
“Constant increases in wafer demand from customers have given us clearer order visibility than in the past. We expect the company’s factory utilization rate to be very high throughout 2021,” Vanguard chairman Fang Leuh (方略) told investors in a teleconference.
“Given the supply-demand imbalance, some customers have booked orders in advance to ensure that our capacity can support them next year,” Fang said.
Asked about the possibility of acquiring a less advanced 6-inch fab, Fang said that the company would clinch a deal as long as the fab has a reasonable price and a good location.
Memorychip maker Macronix International Co (旺宏) is expected to sell a 6-inch fab in Hsinchu.
Vanguard said that its expansion plan aims to address increases in customer demand in the mid to long term, as the chip shortage is expected to extend into next year.
Customers must pay a deposit and prepay to acquire new 8-inch wafer capacity, given the expense of the equipment and the hefty depreciation costs, the chipmaker added.
The prepayments would help safeguard Vanguard’s gross margin and curb increases in depreciation costs, it said.
Much of this year’s capital spending would be used to add 8,000 8-inch wafers per month at a Taoyuan fab later this year and an additional 16,000 wafers per month there in the first half of next year.
For the whole of this year, the chipmaker expects a mild increase in capacity over last year.
Vanguard, which made about 60 percent of its revenue from power management ICs last quarter, yesterday gave positive guidance for this quarter, fueled by resilient demand from display driver ICs used in TVs and PCs.
Revenue this quarter is expected to increase 11 percent sequentially, or up to NT$10.2 billion from NT$9.18 billion last quarter.
The chipmaker based its expectations on a 5 percent price hike from last quarter and a 5 percent increase in capacity, primarily at its Singaporean fab.
Gross margin this quarter is to improve to between 39 percent and 41 percent, from 38.1 percent last quarter, the chipmaker said.
In the January-to-March quarter, Vanguard saw its net profit surge 46.36 percent to NT$2.21 billion from NT$1.55 billion last year. On a quarterly basis, net profit increased 21.43 percent from NT$1.82 billion in the fourth quarter of last year.
Earnings per share climbed to NT$1.34 last quarter, compared with NT$1.1 in the previous quarter and NT$0.89 a year earlier.
Gross margin also improved to 38.1 percent last quarter, up from 31 percent in the same period last year and 37.4 percent three months ago.
The Financial Supervisory Commission (FSC) yesterday fined Citibank Taiwan Ltd (花旗台灣) NT$10 million (US$357,194) and DBS Bank Taiwan (星展台灣) NT$6 million for breaches of the nation’s anti-money laundering (AML) regulations. The NT$10 million fine is the highest penalty that it has imposed on a domestic bank, the commission said. Citibank Taiwan failed to set up a sound mechanism for evaluating clients’ risk of money laundering and for detecting suspicious transactions, Banking Bureau Deputy Director-General Huang Kuang-hsi (黃光熙) told a news conference in New Taipei City. The bank based its AML policies on those of its US-based parent company, Citigroup Inc, but the policies
The rise of the cryptocurrency dogecoin has reached a new level after the token was used to pay for a lunar satellite launch. SpaceX, Elon Musk’s commercial rocket firm, is to embark on a moon voyage next year carrying a so-called cubesat — a mini-satellite used for space research — from Geometric Energy Corp that has been paid for entirely in dogecoin. The development is the latest twist in the saga over the digital token, which started as a joke in 2013, but is now a dominating Internet meme and sitting on a 21,000 percent rally in the past year. Musk has
CAPACITY EXPANSION: Construction of the site, which is to be the firm’s first mRNA production facility outside of Europe, is to begin this year and likely finish in 2023 COVID-19 vaccine maker BioNTech SE yesterday said it would build a Southeast Asia headquarters and manufacturing site in Singapore to produce hundreds of millions of messenger RNA (mRNA)-based vaccines per year. Construction of the site would start this year, and it could become operational by 2023, the German company said in a statement. “With this planned mRNA production facility, we will increase our overall network capacity, and expand our ability to manufacture and deliver our mRNA vaccines and therapies to people around the world,” BioNTech chief executive Ugur Sahin said. The vaccine produced by BioNTech jointly with Pfizer Inc of
COMPETITIVE: The chip designer is offering an annual compensation of NT$1.5 million to NT$2 million, in addition to cash and stock bonuses to attract workers MediaTek Inc (聯發科), the world’s biggest designer of 5G handset chips, is stepping up its recruitment drive this year, with plans to hire more than 2,000 engineers specializing in core technologies, including 5G, wireless communication and artificial intelligence (AI). That would be double from the more than 1,000 people it hired on average in the past few years, as the Hsinchu-based company looks to boost growth this year and beyond. It also comes as the company plans to launch a new 5G chip, Dimensity 2000 series, which supports mmWave technology and sub-6-gigahertz technology, at the end of this year. That would be