UNITED MICROELECTRONICS CORPORATION
AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
WITH REPORT OF INDEPENDENT ACCOUNTANTS
FOR THE SIX-MONTH PERIODS ENDED
JUNE 30, 2015 AND 2014
Address: No. 3 Li-Hsin Road II, Hsinchu Science Park, Hsinchu City, Taiwan, R.O.C.
Telephone: 886-3-578-2258
The reader is advised that these consolidated financial statements have been prepared originally in Chinese. In the event of a conflict between these financial statements and the original Chinese version or difference in interpretation between the two versions, the Chinese language financial statements shall prevail.
1
REVIEW REPORT OF INDEPENDENT ACCOUNTANTS
English Translation of a Report Originally Issued in Chinese
To United Microelectronics Corporation
We have reviewed the accompanying consolidated balance sheets ofUnited Microelectronics Corporation and subsidiaries (collectively, the “Company”) as ofJune 30, 2015 and 2014, the related consolidated statements of comprehensive income for the three-month and six-month periods ended June 30, 2015 and 2014 and consolidated statements of changes in equity and cash flows for the six-month periods ended June 30, 2015 and 2014. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to issue the review report based on our reviews. Certain investments, which were accounted for under the equity method based on the financial statements of the investees, were reviewed by other independent accountants. Our reviews, insofar as it related to the investments accounted for under the equity method balances of NT$4,026 million and NT$4,477 million, which represented 1.22% and 1.47% of the total consolidated assets as of June 30, 2015 and 2014, respectively, the related shares of investment income from the associates and joint ventures in the amount of NT$(12) million, NT$28 million, NT$(21) million and NT$44 million, which represented (0.23)%, 0.72%, (0.22)% and 0.86% of the consolidated income from continuing operations before income tax for the three-month and six-month periods ended June 30, 2015 and 2014, respectively, and the related shares of other comprehensive income from the associates and joint ventures amounted to NT$(594) million, NT$428 million, NT$(385) million and NT$697 million, which represented 128.81%, 12.48%, (11.50)% and 8.04% of the consolidated total comprehensive income, for the three-month and six-month periods ended June 30, 2015 and 2014, respectively, are based solely on the reports of other independent accountants.
We conducted our reviews in accordance with the Statements of Auditing Standards No. 36, “Review of Financial Statements” of the Republic of China. A review is limited primarily to applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the consolidated financial statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our reviews and the reports of other independent accountants, we are not aware of any material modifications or adjustments that should be made to the consolidated financial statements referred to above in order for them to be in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standards No. 34, “Interim Financial Reporting” which is endorsed by Financial Supervisory Commission of the Republic of China.
ERNST & YOUNG
Taiwan
Republic of China
July 29, 2015
Notice to Readers
The accompanying consolidated financial statements are intended only to present the consolidated financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to review such consolidated financial statements are those generally accepted and applied in the Republic of China.
2
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
June 30, 2015, December 31, 2014 and June 30, 2014 (June 30, 2015 and 2014 are unaudited) | ||||||||
(Expressed in Thousands of New Taiwan Dollars) | ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| As of | ||||
Assets |
| Notes |
| June 30, |
| December 31, |
| June 30, |
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
| 6(1) |
| $ 64,046,049 |
| $ 45,701,335 |
| $ 49,634,263 |
Financial assets at fair value through profit or loss, current |
| 6(2), 12(7) |
| 824,567 |
| 740,129 |
| 879,894 |
Available-for-sale financial assets, current |
| 6(5), 12(7) |
| - |
| - |
| 2,729,361 |
Notes receivable |
|
|
| 66,749 |
| 126,141 |
| 86,353 |
Accounts receivable, net |
| 6(3) |
| 21,147,913 |
| 22,207,271 |
| 21,464,004 |
Accounts receivable-related parties, net |
| 7 |
| 220,835 |
| 36,022 |
| 66,033 |
Other receivables |
|
|
| 738,340 |
| 658,409 |
| 739,169 |
Current tax assets |
|
|
| 31,564 |
| 34,480 |
| 31,127 |
Inventories, net |
| 6(4) |
| 16,045,110 |
| 15,242,232 |
| 13,843,940 |
Prepayments |
|
|
| 2,307,304 |
| 2,003,269 |
| 2,326,771 |
Non-current assets held for sale |
| 6(25) |
| - |
| 6,978,991 |
| - |
Other current assets |
|
|
| 3,792,418 |
| 3,134,870 |
| 6,572,944 |
Total current assets |
|
|
| 109,220,849 |
| 96,863,149 |
| 98,373,859 |
|
|
|
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
|
|
|
Financial assets at fair value through profit or loss, noncurrent |
| 6(2), 12(7) |
| 120,705 |
| 45,232 |
| 103,086 |
Available-for-sale financial assets, noncurrent |
| 6(5), 12(7) |
| 23,517,528 |
| 24,362,104 |
| 22,336,669 |
Financial assets measured at cost, noncurrent |
| 6(6) |
| 3,835,105 |
| 3,833,006 |
| 3,739,459 |
Investments accounted for under the equity method |
| 6(7) |
| 11,001,776 |
| 9,237,713 |
| 9,184,605 |
Property, plant and equipment |
| 6(8), 8 |
| 167,959,867 |
| 166,690,243 |
| 157,001,865 |
Intangible assets |
| 6(9) |
| 4,448,984 |
| 4,532,938 |
| 4,648,904 |
Deferred tax assets |
| 6(22) |
| 1,824,986 |
| 2,244,810 |
| 2,502,928 |
Prepayment for equipment |
|
|
| 3,289,420 |
| 1,063,353 |
| 1,231,627 |
Refundable deposits |
| 8 |
| 2,425,899 |
| 1,145,843 |
| 1,215,363 |
Other assets-others |
|
|
| 3,610,499 |
| 3,227,257 |
| 3,460,066 |
Total non-current assets |
|
|
| 222,034,769 |
| 216,382,499 |
| 205,424,572 |
|
|
|
|
|
|
|
|
|
Total assets |
|
|
| $ 331,255,618 |
| $ 313,245,648 |
| $ 303,798,431 |
|
|
|
|
|
|
|
|
|
(continued) |
3
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
June 30, 2015, December 31, 2014 and June 30, 2014 (June 30, 2015 and 2014 are unaudited) | ||||||||
(Expressed in Thousands of New Taiwan Dollars) | ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| As of | ||||
Liabilities and Equity |
| Notes |
| June 30, |
| December 31, |
| June 30, |
Current liabilities |
|
|
|
|
|
|
|
|
Short-term loans |
| 6(10), 8 |
| $ 1,397,000 |
| $ 6,250,754 |
| $ 7,953,800 |
Financial liabilities at fair value through profit or loss, current |
| 6(11), 12(7) |
| 7,440 |
| 42,354 |
| 3,805 |
Notes and accounts payable |
|
|
| 6,469,936 |
| 6,167,339 |
| 6,852,560 |
Other payables |
|
|
| 12,499,656 |
| 12,421,152 |
| 17,827,089 |
Payables on equipment |
|
|
| 9,298,479 |
| 10,478,714 |
| 7,193,457 |
Dividends payable |
| 6(15) |
| 6,939,322 |
| - |
| 125,063 |
Current tax liabilities |
|
|
| 2,135,553 |
| 2,540,688 |
| 978,346 |
Liabilities directly associated with non-current assets held for sale |
| 6(25) |
| - |
| 5,594,850 |
| - |
Current portion of long-term liabilities |
| 6(12), 6(13) |
| 3,937,173 |
| 3,774,986 |
| 7,798,397 |
Other current liabilities |
|
|
| 800,896 |
| 835,239 |
| 946,934 |
Total current liabilities |
|
|
| 43,485,455 |
| 48,106,076 |
| 49,679,451 |
|
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
|
|
Bonds payable |
| 6(12) |
| 41,467,101 |
| 24,977,820 |
| 24,975,764 |
Long-term loans |
| 6(13), 8 |
| 9,280,004 |
| 8,423,470 |
| 6,946,691 |
Deferred tax liabilities |
| 6(22) |
| 1,848,491 |
| 2,161,014 |
| 2,713,407 |
Net defined benefit liabilities, noncurrent |
|
|
| 3,838,506 |
| 3,825,490 |
| 3,809,028 |
Guarantee deposits |
|
|
| 470,757 |
| 451,906 |
| 365,925 |
Other liabilities-others |
| 9(4) |
| 6,482,817 |
| 291,021 |
| 195,424 |
Total non-current liabilities |
|
|
| 63,387,676 |
| 40,130,721 |
| 39,006,239 |
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
| 106,873,131 |
| 88,236,797 |
| 88,685,690 |
|
|
|
|
|
|
|
|
|
Equity attributable to the parent company |
|
|
|
|
|
|
|
|
Capital |
| 6(15), 6(16) |
|
|
|
|
|
|
Common stock |
|
|
| 127,514,409 |
| 127,252,078 |
| 127,063,143 |
Capital collected in advance |
|
|
| 66,920 |
| 50,970 |
| - |
Additional paid-in capital |
| 6(12), 6(15), 6(16) |
|
|
|
|
|
|
Premiums |
|
|
| 37,233,394 |
| 37,145,022 |
| 37,079,810 |
Treasury stock transactions |
|
|
| 1,498,033 |
| 1,255,514 |
| 1,230,880 |
The differences between the fair value of the consideration paid or received from acquiring ordisposing subsidiaries and the carrying amounts of the subsidiaries |
|
|
| 348,342 |
| 348,342 |
| 348,342 |
Recognize changes in subsidiaries’ ownership |
|
|
| 23,656 |
| 563 |
| - |
Share of changes in net assets of associates and joint ventures accounted for using equity method |
|
|
| 113,387 |
| 91,238 |
| 82,278 |
Employee stock options |
|
|
| 22,333 |
| 166,268 |
| 219,233 |
Stock options |
|
|
| 1,572,121 |
| - |
| - |
Other |
|
|
| 598,885 |
| 440,932 |
| 440,932 |
Retained earnings |
| 6(15) |
|
|
|
|
|
|
Legal reserve |
|
|
| 7,725,978 |
| 6,511,844 |
| 6,511,844 |
Unappropriated earnings |
|
|
| 38,250,542 |
| 37,827,179 |
| 30,350,043 |
Other components of equity |
|
|
|
|
|
|
|
|
Exchange differences on translation of foreign operations |
|
|
| (2,966,426) |
| (899,979) |
| (5,247,278) |
Unrealized gains or losses on available-for-sale financial assets |
|
|
| 10,299,912 |
| 13,272,691 |
| 15,257,688 |
Treasury stock |
| 6(15) |
| (1,626,759) |
| (2,303,609) |
| (2,365,246) |
Total equity attributable to the parent company |
|
|
| 220,674,727 |
| 221,159,053 |
| 210,971,669 |
|
|
|
|
|
|
|
|
|
Non-controlling interests |
| 6(15) |
| 3,707,760 |
| 3,849,798 |
| 4,141,072 |
Total equity |
|
|
| 224,382,487 |
| 225,008,851 |
| 215,112,741 |
|
|
|
|
|
|
|
|
|
Total liabilities and equity |
|
|
| $ 331,255,618 |
| $ 313,245,648 |
| $ 303,798,431 |
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of the consolidated financial statements. |
4
English Translation of Consolidated Financial Statements Originally Issued in Chinese | |||||||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | |||||||||
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||||||
For the three-month and six-month periods ended June 30, 2015 and 2014 | |||||||||
(Expressed in Thousands of New Taiwan Dollars, Except for Earnings per Share) | |||||||||
|
|
|
|
|
|
|
|
|
|
|
| For the three-month periods ended June 30, | For the six-month periods ended June 30, | ||||||
| Notes |
| 2015 | 2014 | 2015 | 2014 | |||
Operating revenues | 6(17), 7, 14 |
|
|
|
|
|
|
|
|
Sales revenues |
|
| $ 37,316,186 |
| $ 35,120,293 |
| $ 74,516,342 |
| $ 65,948,569 |
Less: Sales returns and discounts |
|
| (588,793) |
| (78,987) |
| (1,082,532) |
| (160,544) |
Net sales |
|
| 36,727,393 |
| 35,041,306 |
| 73,433,810 |
| 65,788,025 |
Other operating revenues |
|
| 1,284,161 |
| 828,045 |
| 2,227,388 |
| 1,774,911 |
Net operating revenues |
|
| 38,011,554 |
| 35,869,351 |
| 75,661,198 |
| 67,562,936 |
Operating costs | 6(4), 6(14), 6(16) |
|
|
|
|
|
|
|
|
Costs of goods sold |
|
| (28,595,363) |
| (27,008,369) |
| (56,247,766) |
| (52,063,266) |
Other operating costs |
|
| (692,709) |
| (654,172) |
| (1,534,841) |
| (1,391,482) |
Operating costs |
|
| (29,288,072) |
| (27,662,541) |
| (57,782,607) |
| (53,454,748) |
Gross profit |
|
| 8,723,482 |
| 8,206,810 |
| 17,878,591 |
| 14,108,188 |
Realized sale profit (loss) |
|
| - |
| 289 |
| - |
| 289 |
Gross profit-net |
|
| 8,723,482 |
| 8,207,099 |
| 17,878,591 |
| 14,108,477 |
Operating expenses | 6(14), 6(16), 6(18) |
|
|
|
|
|
|
|
|
Sales and marketing expenses |
|
| (929,869) |
| (1,097,156) |
| (1,974,356) |
| (1,930,734) |
General and administrative expenses |
|
| (918,512) |
| (857,004) |
| (1,871,525) |
| (1,704,770) |
Research and development expenses |
|
| (3,015,364) |
| (3,325,778) |
| (5,931,687) |
| (6,660,630) |
Subtotal |
|
| (4,863,745) |
| (5,279,938) |
| (9,777,568) |
| (10,296,134) |
Net other operating income and expenses | 6(19) |
| 16,694 |
| (10,404) |
| (125,920) |
| 45,053 |
Operating income |
|
| 3,876,431 |
| 2,916,757 |
| 7,975,103 |
| 3,857,396 |
Non-operating income and expenses |
|
|
|
|
|
|
|
|
|
Other income | 6(20) |
| 202,232 |
| 229,596 |
| 276,327 |
| 355,202 |
Other gains and losses | 6(20), 6(26), 14 |
| 1,257,219 |
| 882,054 |
| 1,588,758 |
| 1,275,817 |
Finance costs | 6(20) |
| (157,809) |
| (302,353) |
| (272,543) |
| (457,501) |
Share of profit or loss of associates and joint ventures | 6(7), 14 |
| (8,537) |
| 131,629 |
| 33,269 |
| 96,248 |
Exchange gain, net | 12 |
| 10,860 |
| - |
| - |
| 18,484 |
Exchange loss, net | 12 |
| - |
| (3,620) |
| (66,408) |
| - |
Subtotal |
|
| 1,303,965 |
| 937,306 |
| 1,559,403 |
| 1,288,250 |
Income from continuing operations before income tax |
|
| 5,180,396 |
| 3,854,063 |
| 9,534,506 |
| 5,145,646 |
Income tax expense | 6(22), 14 |
| (635,356) |
| (528,337) |
| (1,076,994) |
| (709,113) |
Net income |
|
| 4,545,040 |
| 3,325,726 |
| 8,457,512 |
| 4,436,533 |
Other comprehensive income (loss) | 6(21) |
|
|
|
|
|
|
|
|
Items that may be reclassified subsequently to profit or loss |
|
|
|
|
|
|
|
|
|
Exchange differences on translation of foreign operations |
|
| (1,150,768) |
| (1,465,584) |
| (2,041,596) |
| (21,502) |
Unrealized gain (loss) on available-for-sale financial assets |
|
| (3,279,163) |
| 1,144,416 |
| (2,662,104) |
| 3,553,893 |
Share of other comprehensive income (loss) of associates and joint ventures which may be reclassified subsequently to profit or loss | 6(7) |
| (596,273) |
| 352,467 |
| (417,581) |
| 703,151 |
Income tax related to items that may be reclassified subsequently to profit or loss | 6(22) |
| 20,279 |
| 71,646 |
| 8,258 |
| (2,317) |
Total other comprehensive income (loss), net of tax |
|
| (5,005,925) |
| 102,945 |
| (5,113,023) |
| 4,233,225 |
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) |
|
| $ (460,885) |
| $ 3,428,671 |
| $ 3,344,489 |
| $ 8,669,758 |
|
|
|
|
|
|
|
|
|
|
Net income attributable to: |
|
|
|
|
|
|
|
|
|
Stockholders of the parent |
|
| $ 4,600,375 |
| $ 3,482,421 |
| $ 8,580,285 |
| $ 4,662,119 |
Non-controlling interests |
|
| (55,335) |
| (156,695) |
| (122,773) |
| (225,586) |
|
|
| $ 4,545,040 |
| $ 3,325,726 |
| $ 8,457,512 |
| $ 4,436,533 |
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss) attributable to: |
|
|
|
|
|
|
|
|
|
Stockholders of the parent |
|
| $ (368,719) |
| $ 3,636,320 |
| $ 3,541,059 |
| $ 8,897,032 |
Non-controlling interests |
|
| (92,166) |
| (207,649) |
| (196,570) |
| (227,274) |
|
|
| $ (460,885) |
| $ 3,428,671 |
| $ 3,344,489 |
| $ 8,669,758 |
|
|
|
|
|
|
|
|
|
|
Earnings per share (NTD) | 6(23) |
|
|
|
|
|
|
|
|
Earnings per share-basic |
|
| $ 0.37 |
| $ 0.28 |
| $ 0.68 |
| $ 0.37 |
Earnings per share-diluted |
|
| $ 0.35 |
| $ 0.28 |
| $ 0.66 |
| $ 0.37 |
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of the consolidated financial statements. |
5
English Translation of Consolidated Financial Statements Originally Issued in Chinese | |||||||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||
UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | |||||||||||||||||||||||
For the six-month periods ended June 30, 2015 and 2014 | |||||||||||||||||||||||
(Expressed in Thousands of New Taiwan Dollars) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Equity Attributable to the Parent Company |
|
|
|
| ||||||||||||||||
|
| Capital |
|
| Retained Earnings |
| Other Components of Equity |
|
|
|
|
|
|
| |||||||||
| Notes |
| Common Stock |
| Collected in |
| Additional |
| Legal Reserve |
| Unappropriated |
| Exchange Differences on Translation of Foreign Operations |
| Unrealized Gain or Loss on Available-for-Sale Financial Assets |
| Treasury Stock |
| Total |
| Non- |
| Total Equity |
Balance as of January 1, 2014 | 6(15) |
| $ 126,920,817 |
| $ 25,682 |
| $ 45,326,454 |
| $ 5,248,824 |
| $ 27,189,160 |
| $ (5,271,199) |
| $ 11,046,696 |
| $ (2,365,246) |
| $ 208,121,188 |
| $ 4,319,988 |
| $ 212,441,176 |
Appropriation and distribution of 2013 retained earnings | 6(15) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Legal reserve |
|
| - |
| - |
| - |
| 1,263,020 |
| (1,263,020) |
| - |
| - |
| - |
| - |
| - |
| - |
Cash dividends |
|
| - |
| - |
| - |
| - |
| (125,063) |
| - |
| - |
| - |
| (125,063) |
| - |
| (125,063) |
Cash paid from additional paid-in capital | 6(15) |
| - |
| - |
| (6,128,094) |
| - |
| - |
| - |
| - |
| - |
| (6,128,094) |
| - |
| (6,128,094) |
Net income in the first half of 2014 | 6(15) |
| - |
| - |
| - |
| - |
| 4,662,119 |
| - |
| - |
| - |
| 4,662,119 |
| (225,586) |
| 4,436,533 |
Other comprehensive income (loss), net of tax in the first half of 2014 | 6(15), 6(21) |
| - |
| - |
| - |
| - |
| - |
| 23,921 |
| 4,210,992 |
| - |
| 4,234,913 |
| (1,688) |
| 4,233,225 |
Total comprehensive income (loss) |
|
| - |
| - |
| - |
| - |
| 4,662,119 |
| 23,921 |
| 4,210,992 |
| - |
| 8,897,032 |
| (227,274) |
| 8,669,758 |
Share-based payment transaction | 6(15), 6(16) |
| 142,326 |
| (25,682) |
| 5,933 |
| - |
| - |
| - |
| - |
| - |
| 122,577 |
| - |
| 122,577 |
Convertible bonds repurchased | 6(12) |
| - |
| - |
| 48,756 |
| - |
| - |
| - |
| - |
| - |
| 48,756 |
| - |
| 48,756 |
Share of changes in net assets of associates and joint ventures accounted for using equity method |
|
| - |
| - |
| 55,841 |
| - |
| - |
| - |
| - |
| - |
| 55,841 |
| - |
| 55,841 |
Changes in subsidiaries' ownership | 6(15) |
| - |
| - |
| 92,585 |
| - |
| (113,153) |
| - |
| - |
| - |
| (20,568) |
| 59,572 |
| 39,004 |
Decrease in non-controlling interests | 6(15) |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| (11,214) |
| (11,214) |
Balance as of June 30, 2014 | 6(15) |
| $ 127,063,143 |
| $ - |
| $ 39,401,475 |
| $ 6,511,844 |
| $ 30,350,043 |
| $ (5,247,278) |
| $ 15,257,688 |
| $ (2,365,246) |
| $ 210,971,669 |
| $ 4,141,072 |
| $ 215,112,741 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2015 | 6(15) |
| $ 127,252,078 |
| $ 50,970 |
| $ 39,447,879 |
| $ 6,511,844 |
| $ 37,827,179 |
| $ (899,979) |
| $ 13,272,691 |
| $ (2,303,609) |
| $ 221,159,053 |
| $ 3,849,798 |
| $ 225,008,851 |
Appropriation and distribution of 2014 retained earnings | 6(15) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Legal reserve |
|
| - |
| - |
| - |
| 1,214,134 |
| (1,214,134) |
| - |
| - |
| - |
| - |
| - |
| - |
Cash dividends |
|
| - |
| - |
| - |
| - |
| (6,939,322) |
| - |
| - |
| - |
| (6,939,322) |
| - |
| (6,939,322) |
Net income in the first half of 2015 | 6(15) |
| - |
| - |
| - |
| - |
| 8,580,285 |
| - |
| - |
| - |
| 8,580,285 |
| (122,773) |
| 8,457,512 |
Other comprehensive income (loss), net of tax in the first half of 2015 | 6(15), 6(21) |
| - |
| - |
| - |
| - |
| - |
| (2,066,447) |
| (2,972,779) |
| - |
| (5,039,226) |
| (73,797) |
| (5,113,023) |
Total comprehensive income (loss) |
|
| - |
| - |
| - |
| - |
| 8,580,285 |
| (2,066,447) |
| (2,972,779) |
| - |
| 3,541,059 |
| (196,570) |
| 3,344,489 |
Share-based payment transaction | 6(15), 6(16) |
| 262,331 |
| 15,950 |
| 255,259 |
| - |
| - |
| - |
| - |
| 676,850 |
| 1,210,390 |
| - |
| 1,210,390 |
Embedded conversion options derived from convertible bonds | 6(12) |
| - |
| - |
| 1,572,121 |
| - |
| - |
| - |
| - |
| - |
| 1,572,121 |
| - |
| 1,572,121 |
Share of changes in net assets of associates and joint ventures accounted for using equity method |
|
| - |
| - |
| 22,148 |
| - |
| - |
| - |
| - |
| - |
| 22,148 |
| - |
| 22,148 |
Changes in subsidiaries' ownership | 6(15) |
| - |
| - |
| 23,093 |
| - |
| (3,466) |
| - |
| - |
| - |
| 19,627 |
| 154,932 |
| 174,559 |
Decrease in non-controlling interests | 6(15) |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| (100,400) |
| (100,400) |
Others |
|
| - |
| - |
| 89,651 |
| - |
| - |
| - |
| - |
| - |
| 89,651 |
| - |
| 89,651 |
Balance as of June 30, 2015 | 6(15) |
| $ 127,514,409 |
| $ 66,920 |
| $ 41,410,151 |
| $ 7,725,978 |
| $ 38,250,542 |
| $ (2,966,426) |
| $ 10,299,912 |
| $ (1,626,759) |
| $ 220,674,727 |
| $ 3,707,760 |
| $ 224,382,487 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of the consolidated financial statements. | |||||||||||||||||||||||
6
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
For the six-month periods ended June 30, 2015 and 2014 | ||||
(Expressed in Thousands of New Taiwan Dollars) | ||||
|
|
|
|
|
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Cash flows from operating activities: |
|
|
|
|
Net income before tax |
| $ 9,534,506 |
| $ 5,145,646 |
Adjustments to reconcile net income before tax to net cash provided by operating activities: |
|
|
|
|
Depreciation |
| 21,033,063 |
| 18,971,528 |
Amortization |
| 909,268 |
| 827,380 |
Bad debt expense (reversal) |
| (182,668) |
| 72,465 |
Net gain of financial assets and liabilities at fair value through profit or loss |
| (165,778) |
| (47,529) |
Interest expense |
| 236,503 |
| 432,214 |
Interest revenue |
| (163,522) |
| (260,258) |
Dividend revenue |
| (112,805) |
| (94,944) |
Share-based payment |
| 1,130 |
| 1,267 |
Share of profit of associates and joint ventures |
| (33,269) |
| (96,248) |
Gain on disposal of property, plant and equipment |
| (82,255) |
| (53,398) |
Gain on disposal of non-current assets held for sale |
| (41,203) |
| - |
Gain on disposal of investments |
| (1,508,388) |
| (1,159,030) |
Impairment loss on financial assets |
| 479,044 |
| 163,211 |
Impairment loss on non-financial assets |
| 225,530 |
| - |
Gain on reacquisition of bonds |
| - |
| (13,944) |
Exchange gain on financial assets and liabilities |
| (216,718) |
| (23,430) |
Exchange loss on long-term liabilities |
| - |
| 326 |
Amortization of deferred income |
| (18,881) |
| (20,890) |
Income and expense adjustments |
| 20,359,051 |
| 18,698,720 |
Changes in operating assets and liabilities: |
|
|
|
|
Financial assets and liabilities at fair value through profit or loss |
| (27,058) |
| (203,828) |
Notes receivable and accounts receivable |
| 840,193 |
| (4,915,724) |
Other receivables |
| (109,167) |
| 8,160 |
Inventories |
| (572,008) |
| 128,072 |
Prepayments |
| (372,070) |
| (929,899) |
Other current assets |
| (742,043) |
| (4,641,756) |
Notes and accounts payable |
| 138,663 |
| (547,549) |
Other payables |
| 1,055,520 |
| 1,236,847 |
Other current liabilities |
| (219,345) |
| 107,391 |
Net defined benefit liabilities |
| 13,016 |
| 11,243 |
Other liabilities-others |
| 243,471 |
| (663) |
Cash generated from operations |
| 30,142,729 |
| 14,096,660 |
Interest received |
| 162,657 |
| 220,981 |
Dividend received |
| 229,118 |
| 218,931 |
Interest paid |
| (535,055) |
| (421,859) |
Income tax paid |
| (1,670,918) |
| (202,191) |
Net cash provided by operating activities |
| 28,328,531 |
| 13,912,522 |
|
|
|
|
|
(continued) |
7
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
For the six-month periods ended June 30, 2015 and 2014 | ||||
(Expressed in Thousands of New Taiwan Dollars) | ||||
|
|
|
|
|
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Cash flows from investing activities: |
|
|
|
|
Acquisition of financial assets at fair value through profit or loss |
| $ (77,650) |
| $ (60,036) |
Proceeds from disposal of financial assets at fair value through profit or loss |
| - |
| 22,292 |
Acquisition of available-for-sale financial assets |
| (2,562,094) |
| (115,422) |
Proceeds from disposal of available-for-sale financial assets |
| 727,910 |
| 1,630,929 |
Acquisition of financial assets measured at cost |
| (94,823) |
| (464,359) |
Proceeds from disposal of financial assets measured at cost |
| - |
| 477,596 |
Acquisition of investments accounted for under the equity method |
| (60,000) |
| (121,016) |
Proceeds from disposal of investments accounted for under the equity method |
| - |
| 74,378 |
Proceeds from capital reduction and liquidation of investments |
| 9,688 |
| 35,257 |
Acquisition of subsidiaries (net of cash acquired) |
| 414,958 |
| - |
Disposal of subsidiaries |
| (834,955) |
| (15,617) |
Acquisition of property, plant and equipment |
| (26,926,609) |
| (14,161,448) |
Proceeds from disposal of property, plant and equipment |
| 54,960 |
| 251,973 |
Proceeds from disposal of non-current assets held for sale |
| 641,866 |
| - |
Increase in refundable deposits |
| (1,388,698) |
| (34,525) |
Decrease in refundable deposits |
| 102,255 |
| 106,293 |
Acquisition of intangible assets |
| (693,046) |
| (603,179) |
Cash inflow from combination |
| 1,583 |
| - |
Increase in other assets-others |
| (577,583) |
| (274,378) |
Decrease in other assets-others |
| 6,859 |
| 118,915 |
Net cash used in investing activities |
| (31,255,379) |
| (13,132,347) |
Cash flows from financing activities: |
|
|
|
|
Increase in short-term loans |
| 9,549,918 |
| 8,866,950 |
Decrease in short-term loans |
| (13,429,862) |
| (5,531,578) |
Proceeds from bonds issued |
| 18,424,800 |
| 5,000,000 |
Bonds issuance costs |
| (83,036) |
| (5,090) |
Redemption of bonds |
| - |
| (10,306,392) |
Proceeds from long-term loans |
| 3,827,160 |
| 1,000,000 |
Repayments of long-term loans |
| (3,483,650) |
| (1,255,964) |
Increase in guarantee deposits |
| 34,930 |
| 65,877 |
Decrease in guarantee deposits |
| (5,047) |
| (21,389) |
Increase in other financial liabilities |
| 6,107,635 |
| - |
Exercise of employee stock options |
| 289,413 |
| 121,310 |
Treasury stock sold to employees |
| 677,017 |
| - |
Change in non-controlling interests |
| 69,406 |
| 38,261 |
Net cash provided by (used in) financing activities |
| 21,978,684 |
| (2,028,015) |
Effect of exchange rate changes on cash and cash equivalents |
| (1,218,210) |
| 51,425 |
Net increase (decrease) in cash and cash equivalents |
| 17,833,626 |
| (1,196,415) |
Cash and cash equivalents at beginning of period |
| 46,212,423 |
| 50,830,678 |
Cash and cash equivalents at end of period |
| $ 64,046,049 |
| $ 49,634,263 |
|
|
|
|
|
Investing activities partially paid by cash: |
|
|
|
|
Cash paid for acquiring property, plant and equipment |
|
|
|
|
Increase in property, plant and equipment |
| $ 25,710,265 |
| $ 14,654,162 |
Add: Payable at beginning of period |
| 10,742,203 |
| 6,700,743 |
Less: Effect of disposal of subsidiaries |
| (127,297) |
| - |
Less: Payable at end of period |
| (9,398,562) |
| (7,193,457) |
Cash paid |
| $ 26,926,609 |
| $ 14,161,448 |
|
|
|
|
|
The accompanying notes are an integral part of the consolidated financial statements. |
8
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
For the Six-Month Periods Ended June 30, 2015 and 2014
(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)
1. HISTORY AND ORGANIZATION
United Microelectronics Corporation (UMC) was incorporated in Republic of China (R.O.C.) in May 1980 and commenced operations in April 1982. UMC is a full service semiconductor wafer foundry, and provides a variety of services to satisfy customer needs. UMC’s ordinary shares were publicly listed on the Taiwan Stock Exchange (TWSE) in July 1985 and its American Depositary Shares (ADSs) were listed on the New York Stock Exchange (NYSE) in September 2000.
2. DATE AND PROCEDURES OF AUTHORIZATION OF FINANCIAL STATEMENTS FOR ISSUE
The consolidated financial statements of UMC and its subsidiaries (the “Company”) were authorized for issue in accordance with a resolution of the Board of Directors’ meeting on July 29, 2015.
3. NEWLY ISSUED OR REVISED STANDARDS AND INTERPRETATIONS
A. The Company adopted the International Financial Reporting Standard (IFRS) , International Accounting Standard (IAS) and Interpretations developed by the International Financial Reporting Interpretation Committee (IFRIC) issued, revised or amended by International Accounting Standard Board (IASB) which have been endorsed by Financial Supervisory Commission (FSC) and effective on January 1, 2015 (collectively referred to as “2013 edition of TIFRSs” (TIFRSs)). The effects of adopting TIFRSs on the Company’s consolidated financial statements are summarized as below:
(1) IFRS 3 “Business Combinations”
Under the amendment,IFRS 3 “Business Combinations” (IFRS 3) (as revised in 2008) does not apply to contingent consideration that arose from business combinations whose acquisition dates precede the application of IFRS 3 (as revised in 2008). Furthermore, the amendment limits the scope of the measurement choices for non-controlling interest. Only the components of non-controlling interests that are present ownership interests that entitle their holders to a proportionate share of the entity’s net assets, in the event of liquidation could be measured at either fair value or at the present ownership instruments’ proportionate share of the acquiree’s identifiable net assets. Othercomponents of non-controlling interest are measured at their acquisition date fair value.
9
The amendment also requires an entity in a business combination to account for the replacement of the acquiree’s share-based payment transactions (when the acquirer is not obliged to do so) as new share-based payment awards in the post-combination financial statements.
Outstanding share-based payment transactions that the acquirer does not exchange for its share-based payment transactions: if vested — they are part of non-controlling interest; if unvested — they are measured at market based value as if granted at acquisition date, and allocated between NCI and post-combination expense.
(2) IAS 34 “Interim Financial Reporting”
The amendment clarifies that if users of an entity's interim financial report have access to the most recent annual financial report of that entity, it is unnecessary for the notes to an interim financial report to provide relatively insignificant updates to the information that was reported in the notes in the most recent annual financial report. Furthermore, the amendment requires additional disclosures of financial instruments and contingent liabilities/assets.
(3) IFRS 7 “Financial Instruments: Disclosures”
The amendment emphasizes the interaction between quantitative and qualitative disclosures and the nature and extent of risks associated with financial instruments so that users of financial statements will have a better understanding.
(4) IFRS 7 “Financial Instruments: Disclosures” (Amendment)
The amendment requires additional quantitative and qualitative disclosures relating to transfers of financial assets, when financial assets are derecognized in their entirety, but the entity has a continuing involvement in them, or when financial assets are not derecognized in their entirety.
(5) IFRS 10 “Consolidated Financial Statements”
IFRS 10“Consolidated Financial Statements”(IFRS 10) replaces the portion of IAS 27“Consolidated and Separate Financial Statements” (IAS 27)that addresses the accounting for consolidated financial statements and the former Standing Interpretations Committee (SIC) - 12 “Consolidation-Special Purpose Entities”. The changes introduced by IFRS 10 primarily relate to the elimination of the perceived inconsistency between IAS 27 and SIC-12 by introducing a new integrated control model. That is,IFRS 10 primarily relates to whether to consolidate another entity, but does not change how an entity is consolidated.
10
(6) IFRS 11 “Joint Arrangements”
IFRS 11“Joint Arrangements” replaces IAS 31“Interests in Joint Ventures” and SIC-13 “Jointly Controlled Entities-Non-Monetary Contributions by Venturers”. The changes introduced by IFRS 11 primarily relate to increase comparability within IFRSs by removing the choice for accounting for jointly controlled entities under the proportionate consolidation method, so that the structure of the arrangement is no longer the most important factor when determining the classification as a joint operation or a joint venture (an investment classified as a joint venture is accounted for in accordance with IAS 28 “Investments in Associates and Joint Ventures” (IAS 28)), which then determines the accounting.
(7) IFRS 12 “Disclosures of Interests in Other Entities”
IFRS 12“Disclosures of Interests in Other Entities”primarily integrates and makes consistent the disclosure requirements for subsidiaries, joint arrangements, associates and unconsolidated structured entities and present those requirements in a single IFRS.
(8) IFRS 13 “Fair Value Measurement”
IFRS 13“Fair Value Measurement” (IFRS 13)primarily relates to defining fair value, setting out in a single IFRS framework for measuring and disclosing fair values to reduce complexity and improve consistency in applying fair value measurement. However, IFRS 13 does not change existing requirements in other IFRSs as to when the fair value measurement or related disclosure is required.
(9) IAS 19 “Employee Benefits” (Revised)
The revision includes: (1)For defined benefit plans, the ability to defer the recognition of actuarial gains and losses (i.e., the corridor approach) has been removed. Actuarial gains and losses will be recognized in other comprehensive income as they occur. (2)Amounts recorded in profit or loss are limited to current and past service costs, gains or losses on settlements, and net interest income (expense) on the pension asset or liability. (3)New disclosures include quantitative information about the sensitivity of the defined benefit obligation to reasonably possible changes in each significant actuarial assumption. (4)Termination benefits will be recognized at the earlier of when the offer of termination cannot be withdrawn, or when the related restructuring costs are recognized under IAS 37“Provisions, Contingent Liabilities and Contingent Assets”.
(10)IAS 1 “Presentation of Financial Statements”
The amendment clarifies that an entity will present an analysis of other comprehensive income for each component of equity, either in the statement of changes in equity or in the notes to the financial statements.
11
(11)Presentation of Items of Other Comprehensive Income (Amend IAS 1 “Presentation of Financial Statements”)
The amendments to IAS 1 change the grouping of items presented in other comprehensive income. Items that would be reclassified (or recycled) to profit or loss at certain points in the future would be presented separately from items that will never be reclassified.
(12)IAS 34 “Interim Financial Reporting”
The amendment clarifies the requirements in IAS 34 relating to segment information for total assets and liabilities for each reportable segment to enhance consistency with the requirements in IFRS 8 “Operating Segments”. Besides, total assets and liabilities for a particular reportable segment need to be disclosed only when the amounts are regularly provided to the chief operating decision maker and there has been a material change in the total amount disclosed in the entity’s previous annual financial statements for that reportable segment.
(13)IFRS 10 “Consolidated Financial Statements” (Amendment)
The amendments related to Investment Entities provide an exception to the consolidation requirements in IFRS 10 and require investment entities to account for particular subsidiaries at fair value through profit or loss, rather than consolidating them. The amendments also set out disclosure requirements for investment entities.
The Company has evaluated the impact of the aforementioned standards and interpretations listed (1) ~ (13) to the Company’s financial position and performance and determined that there is no material impact. And, the Company has made necessary disclosures in accordance with the aforementioned standards and interpretations.
12
B. Standards issued by IASB but not yet endorsed by FSC (the effective dates are to be determined by FSC):
|
|
|
|
|
No. |
| The projects of Standards or Interpretations |
| Effective for annual periods beginning on or after |
IAS36 |
| Impairment of Assets |
| January 1, 2014 |
IFRIC 21 |
| Levies |
| January 1, 2014 |
IAS 39 |
| Novation of Derivatives and Continuation of Hedge Accounting |
| January 1, 2014 |
IAS 19 |
| Defined Benefit Plans: Employee Contributions |
| July 1, 2014 |
|
| Improvements to International Financial Reporting Standards (2010-2012 cycle) |
|
|
IFRS 2 |
| Share-based Payment |
| July 1, 2014 |
IFRS 3 |
| Business Combinations |
| July 1, 2014 |
IFRS 8 |
| Operating Segments |
| July 1, 2014 |
IFRS 13 |
| Fair Value Measurement |
| - |
IAS 16 |
| Property, Plant and Equipment |
| July 1, 2014 |
IAS 24 |
| Related Party Disclosures |
| July 1, 2014 |
IAS 38 |
| Intangible Assets |
| July 1, 2014 |
|
| Improvements to International Financial Reporting Standards (2011-2013 cycle) |
|
|
IFRS 1 |
| First-time Adoption of International Financial Reporting Standards |
| - |
IFRS 3 |
| Business Combinations |
| July 1, 2014 |
IFRS 13 |
| Fair Value Measurement |
| July 1, 2014 |
IAS 40 |
| Investment Property |
| July 1, 2014 |
IFRS 14 |
| Regulatory Deferral Accounts |
| January 1, 2016 |
IFRS 11 |
| Accounting for Acquisitions of Interests in Joint Operations |
| January 1, 2016 |
IAS 16 and IAS 38 |
| Clarification of Acceptable Methods of Depreciation and Amortization |
| January 1, 2016 |
IFRS 15 |
| Revenue from Contracts with Customers |
| January 1, 2017 |
IAS 16 and IAS 41 |
| Agriculture: Bearer Plants |
| January 1, 2016 |
IFRS 9 |
| Financial Instruments |
| January 1, 2018 |
IAS 27 |
| Equity Method in Separate Financial Statements |
| January 1, 2016 |
IFRS 10 and IAS 28 |
| Sale or Contribution of Assets between an Investor and its Associate or Joint Venture |
| January 1, 2016 |
|
| Improvements to International Financial Reporting Standards (2012 - 2014 cycle) |
|
|
IFRS 5 |
| Non-current Assets Held for Sale and Discontinued Operations |
| January 1, 2016 |
IFRS 7 |
| Financial Instruments: Disclosures |
| January 1, 2016 |
IAS 19 |
| Employee Benefits |
| January 1, 2016 |
IAS 34 |
| Interim Financial Reporting |
| January 1, 2016 |
IAS 1 |
| Disclosure Initiative |
| January 1, 2016 |
IFRS 10, IFRS 12 and IAS 28 |
| Investment Entities: Applying the Consolidation Exception |
| January 1, 2016 |
13
The potential effects of adopting the standards or interpretations issued by IASB but not yet endorsed by FSC on the Company’s financial statements in future periods are summarized as below:
(14)IAS 36 “Impairment of Assets” (Amendment)
This amendment relates to the amendment issued in May 2011 and requires entities to disclose the recoverable amount of an asset (including goodwill) or a cash-generating unit (CGU) when an impairment loss has been recognized or reversed during the period. The amendment also requires detailed disclosure of how the fair value less costs of disposal has been determined when an impairment loss has been recognized or reversed, including valuation techniques used, level of fair value hierarchy of assets and key assumptions used in the measurements. The amendment is effective for annual periods beginning on or after January 1, 2014.
(15)IFRIC 21 “Levies”
This interpretation provides guidance on when to recognize a liability for a levy imposed by a government (both for levies that are accounted for in accordance with IAS 37 “Provisions, Contingent Liabilities and Contingent Assets” and those where the timing and amount of the levy is certain). The interpretation is effective for annual periods beginning on or after January 1, 2014.
(16)IAS 39 “Financial Instruments: Recognition and Measurement” (Amendment) - Novation of Derivatives and Continuation of Hedge Accounting
Under the amendment, there would be no need to discontinue hedge accounting if a hedging derivative was novated, provided certain criteria are met. The interpretation is effective for annual periods beginning on or after January 1, 2014.
14
(17)IFRS 8 “Operating Segments”
The amendments require an entity to disclose the judgments made by management in applying the aggregation criteria to operating segments. The amendments also clarify that an entity shall only provide reconciliations of the total of the reportable segments’ assets to the entity’s assets if the segment assets are reported regularly to the Chief Operating Decision Maker (CODM). The amendment is effective for annual periods beginning on or after July 1, 2014.
(18)IFRS 13 “Fair Value Measurement”
The amendment to the Basis for Conclusions of IFRS 13 clarifies that when deleting paragraph B5.4.12 of IFRS 9 Financial Instruments and paragraph AG79 of IAS 39 Financial Instruments: Recognition and Measurement as consequential amendments from IFRS 13 Fair Value Measurement, the IASB did not intend to change the measurement requirements for short-term receivables and payables.
(19)IAS 24 “Related Party Disclosures”
The amendment clarifies that an entity providing key management personnel services to the reporting entity or to the parent of the reporting entity is a related party of the reporting entity. The amendment is effective for annual periods beginning on or after July 1, 2014.
(20)IFRS 13 “Fair Value Measurement”
The amendment clarifies that paragraph 52 of IFRS 13 includes a scope exception for measuring the fair value of a group of financial assets and financial liabilities on a net basis. The objective of this amendment is to clarify that this portfolio exception applies to all contracts within the scope of IAS 39 Financial Instruments: Recognition and Measurement or IFRS 9 Financial Instruments, regardless of whether they meet the definitions of financial assets or financial liabilities as defined in IAS 32 Financial Instruments: Presentation. The amendment is effective for annual periods beginning on or after July 1, 2014.
(21)IFRS 11 “Accounting for Acquisitions of Interests in Joint Operations” (Amendment)
The amendments to IFRS 11 require that the relevant principles on business combinations accounting in IFRS 3 and other standards should be applied in accounting for the acquisition of an interest in a joint operation in which the activity constitutes a business. The amendments are applicable to both the acquisition of the initial interest in a joint operation with an existing business and the acquisition of an additional interestin the same joint operation. However, a previously held interest is not remeasured when the acquisition of an additional interest in the same joint operation results in retaining joint control. Transactions between an investor and a joint operation under common control are also excluded. The amendment is effective for annual periods beginning on or after January 1, 2016 with earlier application permitted. The impact that adoption of the new amendment will have on our financial position and results of operation will be dependent upon the specific terms of any applicable future acquisition of joint arrangements.
15
(22)IAS 16 and IAS 38 “Clarification of Acceptable Methods of Depreciation and Amortisation” (Amendment)
The amendment to IAS 16, “Property, Plant and Equipment” (IAS 16) clarifies that depreciation of an item of property, plant and equipment based on revenue generated by using the asset is not appropriate. The amendment to IAS 38, “Intangible Assets” establishes a rebuttable presumption that amortization of an intangible asset based on revenue generated by using the asset is inappropriate. The presumption may only be rebutted in certain limited circumstances where the intangible asset is expressed as a measure of revenue; or where it can be demonstrated that revenue and the consumption of the economic benefits of the intangible asset are highly correlated. The amendment is effective for annual periods beginning on or after January 1, 2016 with earlier application permitted.
(23)IFRS 15 “Revenue from Contracts with Customers”
The core principle of IFRS 15 is that revenue is recognised to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. IFRS 15 establishes a five-step model that will apply to revenue earned from a contract with a customer (with limited exceptions), regardless of the type of revenue transaction or the industry. Extensive disclosures will be required, including disaggregation of total revenue; information related to performance obligations; changes in contract asset and liability account balances between periods and key judgments and estimates. The standard will apply to annual periods beginning on or after January 1, 2017 with early adoption is permitted.
(24)IFRS 9 “Financial Instruments”
The IASB has issued the final version of IFRS 9, which combines classification and measurement, the expected credit loss impairment model and hedge accounting. The standard will replace IAS 39 Financial Instruments: Recognition and Measurement and all previous versions of IFRS 9 which introduced new classification and measurement requirements (in 2009 and 2010) and a new hedge accounting model (in 2013). The final completed version of IFRS 9 requires the followings: (1)Classification and measurement: Financial assets are measured at amortized cost, fair value through profit or loss, or fair value through other comprehensive income, based on both the entity’s business model for managing the financial assets and the financial asset’s contractual cash flow characteristics. Financial liabilities are measured at amortized cost or fair value through profit or loss. Furthermore there is requirement that “own credit risk” adjustments are not recognized in profit or loss. (2) Impairment: Expected credit loss model is used to evaluate impairment. Entities are required to recognize either 12-month or lifetime expected credit losses, depending on whether there has been a significant increase in credit risk since initial recognition. (3) Hedge accounting: Hedge accounting is more closely aligned with risk management activities and hedge effectiveness is measured based on the hedge ratio. The new standard is effective for annual periods beginning on or after January 1, 2018.
16
(25)IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and Joint Ventures” - Sale or Contribution of Assets between an Investor and its Associate or Joint Ventures (Amendment)
The amendments address the inconsistency between the requirements in IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures, in dealing with the loss of control of a subsidiary that is contributed to an associate or a joint venture. IAS 28 restricts gains and losses arising from contributions of non-monetary assets to an associate or a joint venture to the extent of the interest attributable to the other equity holders in the associate or joint ventures. IFRS 10 requires full profit or loss recognition on the loss of control of the subsidiary. IAS 28 was amended so that the gain or loss resulting from the sale or contribution of assets that constitute a business as defined in IFRS 3 between an investor and its associate or joint venture is recognized in full. IFRS 10 was also amended so that the gains or loss resulting from the sale or contribution of a subsidiary that does not constitute a business as defined in IFRS 3 between an investor and its associate or joint venture is recognized only to the extent of the unrelated investors’ interests in the associate or joint venture. The amendment is effective for annual periods beginning on or after January 1, 2016.
(26)IAS 1 “Presentation of Financial Statements”- “Disclosure Initiative” (Amendment):
The amendments (1) clarify that an entity must not reduce the understandability of its financial statements by obscuring material information with immaterial information or by aggregating material items that have different natures or functions. The amendments reemphasize that, when a standard requires a specific disclosure, the information must be assessed to determine whether it is material and, consequently, whether presentation or disclosure of that information is warranted, (2) clarify that specific line items in the statement(s) of profit or loss and OCI and the statement of financial position may be disaggregated, and how an entity shall present additional subtotals, (3) clarify that entities have flexibility as to the order in which they present the notes to financial statements, but also emphasize that understandability and comparability should be considered by an entity when deciding on that order, (4) removing the examples of the income taxes accounting policy and the foreign currencyaccounting policy, as these were considered unhelpful in illustrating what significant accounting policies could be, and (5) clarify that the share of OCI of associates and joint ventures accounted for using the equity method must be presented in aggregate as a single line item, classified between those items that will or will not be subsequently reclassified to profit or loss. The amendment is effective for annual periods beginning on or after January 1, 2016.
17
The Company is currently evaluating the potential impact of the aforementioned standards and interpretations listed (14) ~ (26) to the Company’s financial position and performance, and the related impact will be disclosed when the evaluation is completed.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(1) Statement of Compliance
The Company’s consolidated financial statements were prepared in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers (Regulations), IFRSs, IASs, IFRIC and SIC, which are endorsed by FSC, and IAS34.
(2) Basis of Preparation
The consolidated financial statements have been prepared on a historical cost basis, except for financial instruments measured at fair value.
(3) General Description of Reporting Entity
a. Principles of consolidation
The same principles of consolidation have been applied in the Company’s consolidated financial statements as those applied in the Company’s consolidated financial statements for the three-month period ended March 31, 2015. For the principles of consolidation, please refer to Note 4, (3) of the Company’s consolidated financial statements for the three-month period ended March 31, 2015.
b. The consolidated entities are as follows:
As of June 30, 2015, December 31, 2014 and June 30, 2014
|
|
|
|
|
| Percentage of ownership (%) | ||||
|
|
|
|
|
| as of | ||||
Investor |
| Subsidiary |
| Business nature |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
UMC |
| UMC GROUP (USA) |
| IC Sales |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| UNITED MICROELECTRONICS (EUROPE) B.V. |
| Marketing support activities |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| UMC CAPITAL CORP. |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| GREEN EARTH LIMITED (GE) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| TLC CAPITAL CO., LTD. (TLC) |
| New business investment |
| 100.00 |
| 100.00 |
| 100.00 |
18
|
|
|
|
|
| Percentage of ownership (%) | ||||
|
|
|
|
|
| as of | ||||
Investor |
| Subsidiary |
| Business nature |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
UMC |
| UMC NEW BUSINESS INVESTMENT CORP. (NBI) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| UMC INVESTMENT (SAMOA) LIMITED |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| FORTUNE VENTURE CAPITAL CORP. (FORTUNE) |
| Consulting and planning for investment in new business |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| UMC GROUP JAPAN |
| IC Sales |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| UMC KOREA CO., LTD. |
| Marketing support activities |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| OMNI GLOBAL LIMITED (OMNI) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| BEST ELITE INTERNATIONAL LIMITED (BE) |
| Investment holding |
| 86.88 |
| 86.88 |
| 86.88 |
UMC |
| WAVETEK MICROELECTRONICS CORPORATION (WAVETEK) |
| GaAs Foundry service |
| 77.74 |
| 81.53 |
| 81.53 |
UMC |
| NEXPOWER TECHNOLOGY CORP. (NEXPOWER) |
| Sales and manufacturing of solar power batteries |
| 44.16 |
| 44.16 |
| 44.16 |
FORTUNE |
| UNITRUTH INVESTMENT CORP. (UNITRUTH) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
FORTUNE |
| NEXPOWER |
| Sales and manufacturing of solar power batteries |
| 5.99 |
| 5.99 |
| 5.99 |
FORTUNE |
| WAVETEK |
| GaAs Foundry service |
| 0.45 |
| - |
| - |
FORTUNE |
| TOPCELL SOLAR INTERNATIONAL CO., LTD. (TOPCELL) |
| Sales and manufacturing of solar power cell |
| - |
| 26.04 |
| 26.04 |
19
|
|
|
|
|
| Percentage of ownership (%) | ||||
|
|
|
|
|
| as of | ||||
Investor |
| Subsidiary |
| Business nature |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
UNITRUTH |
| NEXPOWER |
| Sales and manufacturing of solar power batteries |
| 2.25 |
| 2.25 |
| 2.25 |
UNITRUTH |
| WAVETEK |
| GaAs Foundry service |
| 0.28 |
| - |
| - |
UNITRUTH |
| TOPCELL |
| Sales and manufacturing of solar power cell |
| - |
| 1.03 |
| 1.03 |
UMC CAPITAL CORP. |
| UMC CAPITAL (USA) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
UMC CAPITAL CORP. |
| ECP VITA PTE. LTD. |
| Insurance |
| 100.00 |
| 100.00 |
| 100.00 |
TLC |
| SOARING CAPITAL CORP. |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
TLC |
| NEXPOWER |
| Sales and manufacturing of solar power batteries |
| 5.87 |
| 5.87 |
| 5.87 |
TLC |
| TOPCELL |
| Sales and manufacturing of solar power cell |
| - |
| 2.37 |
| 2.37 |
SOARING CAPITAL CORP. |
| UNITRUTH ADVISOR (SHANGHAI) CO., LTD. |
| Investment holding and advisory |
| 100.00 |
| 100.00 |
| 100.00 |
GE |
| UNITED MICROCHIP CORPORATION |
| Investment holding |
| 100.00 |
| - |
| - |
UMC INVESTMENT (SAMOA) LIMITED |
| UMC (BEIJING) LIMITED |
| Marketing support activities |
| 100.00 |
| 100.00 |
| 100.00 |
NBI |
| TERA ENERGY DEVELOPMENT CO., LTD. (TERA ENERGY) |
| Energy Technical Services |
| 100.00 |
| 100.00 |
| 100.00 |
NBI |
| UNISTARS CORP. |
| High brightness LED packages |
| 78.72 |
| 78.72 |
| 78.72 |
NBI |
| TOPCELL |
| Sales and manufacturing of solar power cell |
| - |
| 62.38 |
| 62.38 |
20
|
|
|
|
|
| Percentage of ownership (%) | ||||
|
|
|
|
|
| as of | ||||
Investor |
| Subsidiary |
| Business nature |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
TERA ENERGY |
| EVERRICH ENERGY INVESTMENT (HK) LIMITED (EVERRICH-HK) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
TERA ENERGY |
| TERA ENERGY USA INC. |
| Solar project |
| - |
| 100.00 |
| 100.00 |
TERA ENERGY |
| SMART ENERGY ENTERPRISES LIMITED |
| Investment holding |
| - |
| 100.00 |
| 100.00 |
EVERRICH-HK |
| EVERRICH (SHANDONG) ENERGY CO., LTD. |
| Solar engineering integrated design services |
| 100.00 |
| 100.00 |
| 100.00 |
OMNI |
| UNITED MICROTECHNOLOGY CORPORATION (NEW YORK) |
| Research and development |
| 100.00 |
| 100.00 |
| 100.00 |
OMNI |
| UNITED MICROTECHNOLOGY CORPORATION (CALIFORNIA) |
| Research and development |
| 100.00 |
| 100.00 |
| - |
WAVETEK |
| WAVETEK MICROELECTRONICS INVESTMENT (SAMOA) LIMITED (WAVETEK-SAMOA) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
WAVETEK |
| WAVETEK MICROELECTRONICS INVESTMENT (HK) LIMITED |
| Investment holding |
| - |
| - |
| 100.00 |
WAVETEK- SAMOA |
| WAVETEK MICROELECTRONICS CORPORATION (USA) |
| Sales and marketing service |
| 100.00 |
| 100.00 |
| 100.00 |
NEXPOWER |
| NPT HOLDING LIMITED |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
NEXPOWER |
| SOCIALNEX ITALIA 1 S.R.L. |
| Photovoltaic power plant |
| 100.00 |
| 100.00 |
| 100.00 |
21
|
|
|
|
|
| Percentage of ownership (%) | ||||
|
|
|
|
|
| as of | ||||
Investor |
| Subsidiary |
| Business nature |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
NPT HOLDING LIMITED |
| NLL HOLDING LIMITED |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
BE |
| INFOSHINE TECHNOLOGY LIMITED (INFOSHINE) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
INFOSHINE |
| OAKWOOD ASSOCIATES LIMITED (OAKWOOD) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
OAKWOOD |
| HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. (HEJIAN) |
| Sales and manufacturing of integrated circuits |
| 100.00 |
| 100.00 |
| 100.00 |
HEJIAN |
| UNITEDDS SEMICONDUCTOR (SHANDONG) CO., LTD. |
| Integrated circuits design services |
| 100.00 |
| 100.00 |
| 100.00 |
HEJIAN |
| UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. (USC) (Note A) |
| Sales and manufacturing of integrated circuits |
| 33.33 |
| - |
| - |
Note A: In reference to UMC’s 3-way agreement with Xiamen Municipal People’sGovernment and FUJIAN ELECTRONICS & INFORMATION GROUP described in Note 9(4), the Company invested RMB 0.6 billion in USC and acquired control of the Board of Directors in January 2015. Since the Company obtained control over USC, it was included as a consolidated entity.
22
(4) The same accounting policies have been applied in the Company’s consolidated financial statements for the six-month period ended June 30, 2015 as those applied in the Company’s consolidated financial statements for three-month period ended March 31, 2015. For the summary of other significant accounting policies, please refer to Note 4 of the Company’s consolidated financial statements for three-month period ended March 31, 2015.
5. SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS
The same significant accounting judgments, estimates and assumptions have been applied in the Company’s consolidated financial statements for the six-month period ended June 30, 2015 as those applied in the Company’s consolidated financial statements for the three-month period ended March 31, 2015. For significant accounting judgments, estimates and assumptions, please refer to Note 5 of the Company’s consolidated financial statements for the three-month period ended March 31, 2015.
6. CONTENTS OF SIGNIFICANT ACCOUNTS
(1) Cash and Cash Equivalents
|
| As of |
| ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 | |
Cash on hand |
| $3,785 |
| $3,878 |
| $3,545 | |
Checking and savings accounts |
| 16,307,164 |
| 10,389,664 |
| 9,102,370 | |
Time deposits |
| 40,622,741 |
| 30,782,070 |
| 37,304,794 | |
Repurchase agreements collateralized by government bonds and corporate bonds |
| 7,112,359 |
| 4,525,723 |
| 3,223,554 | |
Total |
| $64,046,049 |
| $45,701,335 |
| $49,634,263 | |
(2) Financial Assets at Fair Value through Profit or Loss
|
| As of |
| ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 | |
Designated financial assets at fair value through profit or loss |
|
|
|
|
|
| |
Convertible bonds |
| $222,604 |
| $150,550 |
| $103,086 | |
|
|
|
|
|
|
| |
Financial assets held for trading |
|
|
|
|
|
| |
Listed stocks |
| 325,329 |
| 246,183 |
| 481,213 | |
Corporate bonds |
| 385,183 |
| 388,628 |
| 398,681 | |
Forward exchange contracts |
| 12,156 |
| - |
| - | |
Subtotal |
| 722,668 |
| 634,811 |
| 879,894 | |
Total |
| $945,272 |
| $785,361 |
| $982,980 | |
|
|
|
|
|
|
| |
Current |
| $824,567 |
| $740,129 |
| $879,894 | |
Noncurrent |
| 120,705 |
| 45,232 |
| 103,086 | |
Total |
| $945,272 |
| $785,361 |
| $982,980 |
23
(3) Accounts Receivable, Net
|
| As of |
| ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 | |
Accounts receivable |
| $22,109,018 |
| $23,307,624 |
| $22,575,829 | |
Less: allowance for sales returns and discounts |
| (870,374) |
| (828,029) |
| (467,405) | |
Less: allowance for doubtful accounts |
| (90,731) |
| (272,324) |
| (644,420) | |
Net |
| $21,147,913 |
| $22,207,271 |
| $21,464,004 |
Aging analysis of account receivables:
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Neither past due nor impaired |
| $17,924,093 |
| $17,067,173 |
| $18,451,062 |
Past due but not impaired: |
|
|
|
|
|
|
≤ 30 days |
| 2,359,484 |
| 4,409,411 |
| 2,407,970 |
31 to 60 days |
| 423,859 |
| 313,494 |
| 192,536 |
61 to 90 days |
| 271,978 |
| 230,086 |
| 397,705 |
91 to 120 days |
| 142,744 |
| 32,858 |
| 3,875 |
> 120 days |
| 25,755 |
| 154,249 |
| 10,856 |
Subtotal |
| 3,223,820 |
| 5,140,098 |
| 3,012,942 |
Total |
| $21,147,913 |
| $22,207,271 |
| $21,464,004 |
Movement on allowance for individually evaluated doubtful accounts:
|
| For the six-month periods endedJune 30, | ||
|
| 2015 |
| 2014 |
Beginning balance |
| $272,324 |
| $574,421 |
Net charge for the period |
| (181,593) |
| 69,999 |
Ending balance |
| $90,731 |
| $644,420 |
24
The terms for third party domestic sales were net 30~60 days, while the collection periods for third party overseas sales were month end 30~60 days.
The impairment losses assessed individually as ofJune 30, 2015 and 2014 primarily resulted from the financial difficulties of the counter trading parties and the amounts recognized were the difference between the carrying amount of the accounts receivable and the present value of expected collectable amounts. The Company has no collateral with respect to those accounts receivables.
(4) Inventories, Net
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Raw materials |
| $2,351,020 |
| $2,136,306 |
| $1,960,713 |
Supplies and spare parts |
| 1,925,704 |
| 1,627,687 |
| 1,553,403 |
Work in process |
| 10,436,172 |
| 10,204,855 |
| 8,898,315 |
Finished goods |
| 1,332,214 |
| 1,273,384 |
| 1,431,509 |
Total |
| $16,045,110 |
| $15,242,232 |
| $13,843,940 |
a. Forthe three-month periods ended June 30, 2015 and 2014, the Company recognized NT$28,595 million and NT$27,008 million, respectively, in operating cost, of which NT$494 million loss was as a result of the net realized value of inventory being lower than its cost and NT$147 million wasrelated to gains recognized when the circumstances that caused the net realizable value of inventory to be lower than its cost no longer existed. For the six-month periods ended June 30, 2015 and 2014, the Company recognized NT$56,248 million and NT$52,063 million, respectively, in operating cost, of which NT$615 million loss was as a result of the net realized value of inventory being lower than its cost and NT$128 million wasrelated to gains recognized when the circumstances that caused the net realizable value of inventory to be lower than its cost no longer existed.
b. Inventories were not pledged.
(5) Available-For-Sale Financial Assets
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Common stocks |
| $22,200,614 |
| $23,510,084 |
| $24,659,837 |
Preferred stocks |
| 1,042,280 |
| 781,148 |
| 277,200 |
Depositary receipts |
| 196,430 |
| - |
| - |
Funds |
| 78,204 |
| 70,872 |
| 128,993 |
Total |
| $23,517,528 |
| $24,362,104 |
| $25,066,030 |
|
|
|
|
|
|
|
Current |
| $- |
| $- |
| $2,729,361 |
Noncurrent |
| 23,517,528 |
| 24,362,104 |
| 22,336,669 |
Total |
| $23,517,528 |
| $24,362,104 |
| $25,066,030 |
25
UMC issued bonds that were exchangeable at any time on or after January 1, 2010 and prior to November 22, 2014, for common stocks originallyowned and classified as available-for-sale financial assets, noncurrent. Therefore,thesecommon stocks were classified as current assets since the exchangeable date. The bonds matured on December 2, 2014 and UMC redeemed all the remaining bonds.
(6) Financial Assets Measured at Cost, Non-current
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Common stocks |
| $595,772 |
| $602,429 |
| $612,520 |
Preferred stocks |
| 3,102,927 |
| 3,100,211 |
| 2,998,892 |
Funds |
| 136,406 |
| 130,366 |
| 128,047 |
Total |
| $3,835,105 |
| $3,833,006 |
| $3,739,459 |
Since these financial assets mostly consist of non-publicly traded stocks and private venture funds, for which the fair value cannot be reliably measured due to lack of sufficient financial information available, the Company measures these financial assets at cost.
(7) Investments Accounted For Under the Equity Method
a. Details of investments accounted for under the equity method are as follows:
|
|
As of | ||||||
|
| June 30, 2015 |
| December 31, 2014 | ||||
Investee companies |
| Amount |
| Percentage of ownership or voting rights |
| Amount |
| Percentage of ownership or voting rights |
List company |
|
|
|
|
|
|
|
|
FARADAYTECHNOLOGYCORP. (FARADAY)(Note A) |
| $2,719,694 |
| 13.80 |
| $- |
| - |
|
|
|
|
|
|
|
|
|
Unlisted companies |
|
|
|
|
|
|
|
|
MOS ART PACK CORP. (MAP) (Note B) |
| 238,373 |
| 72.98 |
| 238,373 |
| 72.98 |
UNITED LIGHTING OPTO-ELECTRONIC INC.(UNITED LIGHTING) (Note C) |
| 9,586 |
| 55.25 |
| 9,586 |
| 55.25 |
26
|
|
As of | ||||||
|
| June 30, 2015 |
| December 31, 2014 | ||||
Investee companies |
| Amount |
| Percentage of ownership or voting rights |
| Amount |
| Percentage of ownership or voting rights |
SHANDONG HUAHONG ENERGY INVEST CO., INC. (SHANDONG HUAHONG) (Note D) |
| $697,802 |
| 50.00 |
| $731,565 |
| 50.00 |
WINAICO SOLAR PROJEKT 1 GMBH (Note D) |
| 31,383 |
| 50.00 |
| 35,532 |
| 50.00 |
LIST EARN ENTERPRISE INC. |
| 10,442 |
| 49.00 |
| 10,660 |
| 49.00 |
MTIC HOLDINGS PTE. LTD. |
| 92,444 |
| 45.44 |
| 105,872 |
| 45.44 |
YUNG LI INVESTMENTS, INC. |
| 318,477 |
| 45.16 |
| 219,157 |
| 45.16 |
MEGA MISSION LIMITED PARTNERSHIP |
| 1,974,086 |
| 45.00 |
| 2,052,269 |
| 45.00 |
WINAICO IMMOBILIEN GMBH (Note D) |
| 224,443 |
| 44.78 |
| 256,064 |
| 44.78 |
UNITECH CAPITAL INC. |
| 686,393 |
| 42.00 |
| 682,191 |
| 42.00 |
HSUN CHIEH INVESTMENT CO., LTD. |
| 3,339,329 |
| 36.49 |
| 3,749,009 |
| 36.49 |
CTC CAPITAL PARTNERS I, L.P. |
| 167,432 |
| 31.40 |
| 183,681 |
| 31.40 |
VSENSE CO., LTD. |
| 105,497 |
| 28.63 |
| - |
| - |
TRANSLINK CAPITAL PARTNERS III, L.P. |
| 194,438 |
| 27.29 |
| 199,443 |
| 29.29 |
UNITED LED CORPORATION HONG KONG LIMITED |
| 519,366 |
| 25.14 |
| 518,495 |
| 29.03 |
ACHIEVE MADE INTERNATIONAL LTD. |
| 113,422 |
| 23.32 |
| 121,567 |
| 23.32 |
TRANSLINK CAPITAL PARTNERS I, L.P. (Note E) |
| 99,169 |
| 10.38 |
| 124,249 |
| 10.38 |
Total |
| $11,001,776 |
|
|
| $9,237,713 |
|
|
27
|
|
|
| As of | ||||
|
|
|
| June 30, 2014 | ||||
Investee companies |
|
|
|
|
| Amount |
| Percentage of ownership or voting rights |
Unlisted companies |
|
|
|
|
|
|
|
|
MAP (Note B) |
|
|
|
|
| $238,373 |
| 72.98 |
UNITED LIGHTING (Note C) |
|
|
|
|
| 9,586 |
| 55.25 |
SHANDONG HUAHONG (Note D) |
|
|
|
|
| 702,259 |
| 50.00 |
WINAICO SOLAR PROJEKT 1 GMBH (Note D) |
|
|
|
|
| 42,719 |
| 50.00 |
ACHIEVE MADE INTERNATIONAL LTD. |
|
|
|
|
| 112,566 |
| 49.38 |
LIST EARN ENTERPRISE INC. |
|
|
|
|
| 9,820 |
| 49.00 |
MTIC HOLDINGS PTE. LTD. |
|
|
|
|
| 149,106 |
| 45.44 |
YUNG LI INVESTMENTS, INC. |
|
|
|
|
| 276,185 |
| 45.16 |
MEGA MISSION LIMITED PARTNERSHIP |
|
|
|
|
| 1,953,754 |
| 45.00 |
WINAICO IMMOBILIEN GMBH (Note D) |
|
|
|
|
| 281,882 |
| 44.78 |
UNITECH CAPITAL INC. |
|
|
|
|
| 766,542 |
| 42.00 |
HSUN CHIEH INVESTMENT CO., LTD. |
|
|
|
|
| 3,710,226 |
| 36.49 |
UC FUND II |
|
|
|
|
| 3,909 |
| 35.45 |
CTC CAPITAL PARTNERS I, L.P. |
|
|
|
|
| 201,450 |
| 31.40 |
TRANSLINK CAPITAL PARTNERS III, L.P. (Note E) |
|
|
|
|
| 109,088 |
| 29.29 |
UNITED LED CORPORATION HONG KONG LIMITED |
|
|
|
|
| 513,156 |
| 29.03 |
TRANSLINK CAPITAL PARTNERS I, L.P. (Note E) |
|
|
|
|
| 103,984 |
| 10.38 |
Total |
|
|
|
|
| $9,184,605 |
|
|
28
Note A: After FARADAY re-elected its board members through the shareholders' meeting in June 2015, UMC holds two seats out of nine Board of Directors and UMC’s chairman of board also serves as FARADAY’s chairman of the board. Based on IFRS, the investment in FARADAY shall be accounted under equity method since UMC has significant influence over FARADAY.
Note B: On March 10, 2011, MAP filed for liquidation through a decision at its stockholders’ meeting. The liquidation has not been completed as of June 30, 2015.
Note C: On June 19, 2012, UNITED LIGHTING filed for liquidation through a decision at its stockholders’ meeting. The liquidation has not been completed as of June 30, 2015.
Note D: The Company uses the equity method to account for its investment in SHANDONG HUAHONG, WINAICO SOLAR PROJEKT 1 GMBH and WINAICO IMMOBILIEN GMBH, which are joint ventures.
Note E: The Company follows international accounting practices in equity accounting for limited partnerships because no equivalent type of business exists domestically. Therefore, the Company uses the equity method to account for these investees.
The carrying amount of investments accounted for using the equity method for which there are published price quotations amounted to NT$2,180 million, nil and nil, as of June 30, 2015, December 31, 2014 and June 30, 2014, respectively. The fair value of these investments were NT$2,166 million, nil, and nil, as of June 30, 2015, December 31, 2014 and June 30, 2014, respectively.
Certain investments accounted for under the equity method were reviewed by other independent accountants. Shares of investment income (loss) from these associates and joint ventures amounted to NT$(12) million,NT$28 million,NT$(21)million and NT$44million for thethree-month and six-momthperiodsendedJune 30, 2015 and 2014, respectively. Share of other comprehensive income from these associates and joint ventures amounted to NT$(594) million, NT$428 million, NT$(385)million and NT$697million for thethree-month and six-month periods endedJune 30, 2015 and 2014, respectively. The balances of investments accounted for under the equity method were NT$4,026 million, NT$4,537 million and NT$4,477million as ofJune 30, 2015, December 31, 2014 and June 30, 2014, respectively.
No investment accounted for using the equity method was pledged.
29
b. Financial information of associates and joint ventures:
There is no individually significant associate or joint venture for the Company. When an associate or a joint venture is a foreign operation, and the functional currency of the foreign entity is different from the Company, an exchange difference arising from translation of the foreign entity will be recognized in other comprehensive income(loss). Such exchange differences recognized in other comprehensive income (loss) in the financial statements for the three-month and six-month periods endedJune 30, 2015 were respectively NT$(20) million and NT$(81) million, which were not included in the following table.
(i) The aggregate amount of the Company’s share of its associates that are accounted for using the equity method was as follows:
|
| For the three-month period endedJune 30, 2015 |
| For the six-month period endedJune 30, 2015 |
Net income (loss) |
| $(14,565) |
| $52,049 |
Other comprehensive loss |
| (539,497) |
| (299,900) |
Total comprehensive loss |
| $(554,062) |
| $(247,851) |
(ii) The Company began to use the equity method to account for its investments in SHANDONG HUAHONG, WINAICO SOLAR PROJEKT 1 GMBH and WINAICO IMMOBILIEN GMBH, on January 7, 2011, December 7, 2011 and March 31, 2013, respectively. The aggregate amount of the Company’s share of its joint ventures that are accounted for using the equity method was as follows:
|
| For the three-month period endedJune 30, 2015 |
| For the six-month period endedJune 30, 2015 |
Net income (loss) |
| $6,028 |
| $(18,780) |
Other comprehensive loss |
| (31,464) |
| (31,464) |
Total comprehensive loss |
| $(25,436) |
| $(50,244) |
c. One of UMC’s associate, HSUN CHIEH INVESTMENT CO., LTD., held 441 million shares of UMC’s stock as of June 30, 2015, December 31, 2014 and June 30, 2014. Another associate,MEGA MISSION LIMITED PARTNERSHIP, held 35 million shares, 29 million shares and nil share of UMC’s stock as of June 30, 2015, December 31, 2014 and June 30, 2014, respectively.
30
(8) Property, Plant and Equipment
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Land |
| $1,314,402 |
| $1,314,402 |
| $1,915,066 |
Buildings |
| 12,294,460 |
| 12,955,815 |
| 13,218,940 |
Machinery and equipment |
| 124,110,363 |
| 119,069,687 |
| 122,670,143 |
Transportation equipment |
| 14,690 |
| 14,630 |
| 14,102 |
Furniture and fixtures |
| 928,328 |
| 942,520 |
| 1,101,291 |
Leasehold improvement |
| 10,485 |
| 12,210 |
| 961,113 |
Construction in progress and equipment awaiting inspection |
| 29,287,139 |
| 32,380,979 |
| 17,121,210 |
Net |
| $167,959,867 |
| $166,690,243 |
| $157,001,865 |
Cost:
|
| Land |
| Buildings |
| Machinery and equipment |
| Transportation equipment |
| Furniture and fixtures |
| Leasehold improvement |
| Construction in progress and equipment awaiting inspection |
| Total |
As of January 1, 2015 |
| $1,314,402 |
| $25,837,548 |
| $662,490,428 |
| $67,683 |
| $5,359,909 |
| $68,280 |
| $32,380,979 |
| $727,519,229 |
Additions |
| - |
| - |
| - |
| - |
| - |
| - |
| 21,984,849 |
| 21,984,849 |
Acquired in busiiness combination |
| - |
| - |
| 123,124 |
| - |
| 31,009 |
| - |
| 210 |
| 154,343 |
Disposals |
| - |
| - |
| (1,058,700) |
| (809) |
| (35,390) |
| - |
| - |
| (1,094,899) |
Transfers and reclassifications |
| - |
| 9,279 |
| 26,175,678 |
| 2,699 |
| 148,033 |
| - |
| (24,967,404) |
| 1,368,285 |
Exchange effect |
| - |
| (126,318) |
| (3,439,202) |
| (356) |
| (10,985) |
| (1,251) |
| (111,495) |
| (3,689,607) |
As ofJune 30, 2015 |
| $1,314,402 |
| $25,720,509 |
| $684,291,328 |
| $69,217 |
| $5,492,576 |
| $67,029 |
| $29,287,139 |
| $746,242,200 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Land |
| Buildings |
| Machinery and equipment |
| Transportation equipment |
| Furniture and fixtures |
| Leasehold improvement |
| Construction in progress and equipment awaiting inspection |
| Total |
As of January 1, 2014 |
| $1,925,691 |
| $25,846,909 |
| $630,966,729 |
| $66,554 |
| $5,285,463 |
| $1,800,921 |
| $19,368,388 |
| $685,260,655 |
Additions |
| - |
| - |
| - |
| - |
| - |
| - |
| 12,406,599 |
| 12,406,599 |
Disposals |
| (10,625) |
| - |
| (1,878,073) |
| - |
| (26,260) |
| (2,880) |
| - |
| (1,917,838) |
Transfers andreclassifications |
| - |
| (388,515) |
| 16,054,430 |
| 1,227 |
| 165,984 |
| 61,910 |
| (14,691,533) |
| 1,203,503 |
Exchange effect |
| - |
| 1,343 |
| (25,588) |
| (72) |
| 139 |
| (59) |
| 37,756 |
| 13,519 |
As of June 30, 2014 |
| $1,915,066 |
| $25,459,737 |
| $645,117,498 |
| $67,709 |
| $5,425,326 |
| $1,859,892 |
| $17,121,210 |
| $696,966,438 |
31
Accumulated Depreciation and Impairment:
|
| Land |
| Buildings |
| Machinery and equipment |
| Transportation equipment |
| Furniture and fixtures |
| Leasehold improvement |
| Construction in progress and equipment awaiting inspection |
| Total |
As of January 1, 2015 |
| $- |
| $12,881,733 |
| $543,420,741 |
| $53,053 |
| $4,417,389 |
| $56,070 |
| $- |
| $560,828,986 |
Depreciation |
| - |
| 578,124 |
| 20,280,169 |
| 2,329 |
| 170,858 |
| 1,583 |
| - |
| 21,033,063 |
Impairment Loss |
| - |
| - |
| 225,530 |
| - |
| - |
| - |
| - |
| 225,530 |
Disposals |
| - |
| - |
| (1,014,486) |
| (618) |
| (35,390) |
| - |
| - |
| (1,050,494) |
Transfers and reclassifications |
| - |
| (305) |
| 1,389 |
| - |
| 20,533 |
| - |
| - |
| 21,617 |
Exchange effect |
| - |
| (33,503) |
| (2,732,378) |
| (237) |
| (9,142) |
| (1,109) |
| - |
| (2,776,369) |
As of June 30, 2015 |
| $- |
| $13,426,049 |
| $560,185,965 |
| $54,527 |
| $4,564,248 |
| $56,544 |
| $- |
| $578,282,333 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Land |
| Buildings |
| Machinery and equipment |
| Transportation equipment |
| Furniture and fixtures |
| Leasehold improvement |
| Construction in progress and equipment awaiting inspection |
| Total |
As of January 1, 2014 |
| $- |
| $12,167,522 |
| $505,795,974 |
| $51,507 |
| $4,136,774 |
| $755,978 |
| $- |
| $522,907,755 |
Depreciation |
| - |
| 601,342 |
| 18,044,692 |
| 2,175 |
| 177,271 |
| 146,048 |
| - |
| 18,971,528 |
Disposals |
| - |
| - |
| (1,867,371) |
| - |
| (25,002) |
| (2,880) |
| - |
| (1,895,253) |
Transfers and reclassifications |
| - |
| (526,946) |
| 489,565 |
| (36) |
| 34,908 |
| (320) |
| - |
| (2,829) |
Exchange effect |
| - |
| (1,121) |
| (15,505) |
| (39) |
| 84 |
| (47) |
| - |
| (16,628) |
As of June 30, 2014 |
| $- |
| $12,240,797 |
| $522,447,355 |
| $53,607 |
| $4,324,035 |
| $898,779 |
| $- |
| $539,964,573 |
During the six-month period ended June 30, 2015, UMC determined the machinery and equipment would not be utilized any longer due to physical damage. Therefore, UMC recorded an impairment loss of NT$226 million , the carrying value of this asset.
a. The amounts of total interest expense before capitalization of borrowing costs were NT$389 million and NT$590 million for thesix-month periods endedJune 30, 2015 and 2014, respectively. Details of capitalized borrowing costs are as follows:
|
| For thesix-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Buildings |
| $35,122 |
| $51,590 |
Machinery and equipment |
| 109,210 |
| 106,020 |
Others |
| 7,695 |
| 360 |
Total interest capitalized |
| $152,027 |
| $157,970 |
|
|
|
|
|
Interest rates applied |
| 1.35%~2.10% |
| 1.44%~2.21% |
b. Please refer to Note 8 for property, plant and equipment pledged as collateral.
32
(9) Intangible Assets
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Goodwill |
| $15,188 |
| $7,791 |
| $50,863 |
Software |
| 230,387 |
| 215,998 |
| 142,739 |
Patents and technology license fees |
| 2,790,392 |
| 3,021,788 |
| 3,191,389 |
Others |
| 1,413,017 |
| 1,287,361 |
| 1,263,913 |
Net |
| $4,448,984 |
| $4,532,938 |
| $4,648,904 |
Cost:
|
| Goodwill |
| Software |
| Patents and technology license fees |
| Others |
| Total |
As of January 1, 2015 |
| $7,791 |
| $490,744 |
| $4,229,744 |
| $2,904,499 |
| $7,632,778 |
Additions |
| - |
| - |
| 259 |
| 599,646 |
| 599,905 |
Acquired in busiiness combination |
| 7,397 |
| 330 |
| 11,023 |
| - |
| 18,750 |
Disposals |
| - |
| (137,709) |
| - |
| (437,444) |
| (575,153) |
Reclassifications |
| - |
| 83,966 |
| (259) |
| - |
| 83,707 |
Exchange effect |
| - |
| (1,800) |
| (29,474) |
| (11) |
| (31,285) |
As of June 30, 2015 |
| $15,188 |
| $435,531 |
| $4,211,293 |
| $3,066,690 |
| $7,728,702 |
|
|
|
|
|
|
|
|
|
|
|
|
| Goodwill |
| Software |
| Patents and technology license fees |
| Others |
| Total |
As of January 1, 2014 |
| $50,863 |
| $432,462 |
| $4,155,667 |
| $2,110,088 |
| $6,749,080 |
Additions |
| - |
| - |
| 8,500 |
| 585,410 |
| 593,910 |
Disposals |
| - |
| (83,887) |
| - |
| (77,644) |
| (161,531) |
Reclassifications |
| - |
| 38,230 |
| - |
| (61,700) |
| (23,470) |
Exchange effect |
| - |
| 297 |
| 117 |
| (1) |
| 413 |
As ofJune 30, 2014 |
| $50,863 |
| $387,102 |
| $4,164,284 |
| $2,556,153 |
| $7,158,402 |
33
|
| Goodwill |
| Software |
| Patents and technology license fees |
| Others |
| Total |
As of January 1, 2015 |
| $- |
| $274,746 |
| $1,207,956 |
| $1,617,138 |
| $3,099,840 |
Amortization |
| - |
| 69,183 |
| 221,463 |
| 473,985 |
| 764,631 |
Disposals |
| - |
| (137,709) |
| - |
| (437,444) |
| (575,153) |
Exchange effect |
| - |
| (1,076) |
| (8,518) |
| (6) |
| (9,600) |
As of June 30, 2015 |
| $- |
| $205,144 |
| $1,420,901 |
| $1,653,673 |
| $3,279,718 |
|
|
|
|
|
|
|
|
|
|
|
|
| Goodwill |
| Software |
| Patents and technology license fees |
| Others |
| Total |
As of January 1, 2014 |
| $- |
| $259,210 |
| $754,898 |
| $995,325 |
| $2,009,433 |
Amortization |
| - |
| 67,425 |
| 218,926 |
| 436,260 |
| 722,611 |
Disposals |
| - |
| (83,887) |
| - |
| (77,644) |
| (161,531) |
Reclassifications |
| - |
| 1,398 |
| - |
| (61,700) |
| (60,302) |
Exchange effect |
| - |
| 217 |
| (929) |
| (1) |
| (713) |
As of June 30, 2014 |
| $- |
| $244,363 |
| $972,895 |
| $1,292,240 |
| $2,509,498 |
The amortization amounts of intangible assets are as follows:
|
| For thethree-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Operating cost |
| $128,094 |
| $127,866 |
Operating expense |
| $271,383 |
| $255,412 |
|
| For thesix-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Operating cost |
| $259,489 |
| $255,316 |
Operating expense |
| $505,142 |
| $467,295 |
The carrying amounts of significant technology license fees obtained by the Company were NT$2,642 million, NT$2,858 million and NT$3,015 million as of June 30, 2015, December 31, 2014 and June 30, 2014, respectively. The remaining amortization periods were 7~8 years, 7~8 years and 8~9 years, respectively.
34
(10)Short-term Loans
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Unsecured bank loans |
| $1,397,000 |
| $6,250,754 |
| $7,953,800 |
|
| For thesix-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Interest rates applied |
| 0.61%~2.75% |
| 0.57%~2.45% |
a. The Company’s unused short-term lines of credits amounted to NT$20,446 million, NT$19,650 million and NT$17,872 million as ofJune 30, 2015, December 31, 2014 and June 30, 2014, respectively.
b. Please refer to Note 8 for property, plant and equipment pledged as collateral for short- term loans.
(11)Financial Liabilities at Fair Value through Profit or Loss, Current
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Forward exchange contracts |
| $7,440 |
| $42,354 |
| $- |
Derivatives embedded in exchangeable bonds |
| - |
| - |
| 3,805 |
Total |
| $7,440 |
| $42,354 |
| $3,805 |
35
(12)Bonds Payable
|
| As of | ||||
|
| June 30,2015 |
| December 31, 2014 |
| June 30,2014 |
Unsecured domestic bonds payable |
| $25,000,000 |
| $25,000,000 |
| $25,000,000 |
Unsecured exchangeable bonds payable |
| - |
| - |
| 3,710,580 |
Unsecured convertible bonds payable |
| 18,196,332 |
| - |
| - |
Less: Discounts on bonds payable |
| (1,729,231) |
| (22,180) |
| (88,817) |
Total |
| 41,467,101 |
| 24,977,820 |
| 28,621,763 |
Less: Current or exchangeable portion due within one year |
| - |
| - |
| (3,645,999) |
Net |
| $41,467,101 |
| $24,977,820 |
| $24,975,764 |
A. On December 2, 2009, UMC issued SGX-ST listed zero coupon exchangeable bonds. The terms and conditions of the bonds are as follows:
a. Issue Amount: US$127.2 million
b. Period: December 2, 2009 ~ December 2, 2014 (Maturity date)
c. Redemption:
i. UMC may redeem the bonds, in whole or in part, after 12 months of the issuance and prior to the maturity date, at the principal amount of the bonds with an interest calculated at the rate of -0.5% per annum (the Early Redemption Price) if the closing price of the ordinary shares of Unimicron Technology Corporation (Unimicron) on the TWSE, translated into U.S. dollars at the prevailing exchange rate, for a period of 20 consecutive trading days, the last of which occurs not more than 10 days prior to the date upon which notice of such redemption is published, is at least 130% of the exchange price then in effect translated into U.S. dollars at the rate of NTD 32.197=USD 1.00.
36
ii. UMC may redeem the bonds, in whole, but not in part, at the Early Redemption Price if at least 90% in principal amount of the bonds has already been exchanged, redeemed or purchased and cancelled.
iii. UMC may redeem all, but not part, of the bonds, at the Early Redemption Price at any time, in the event of certain changes in the R.O.C.’s tax rules which would require UMC to gross up for payments of principal, or to gross up for payments of interest or premium.
iv. All, or any portion, of the bonds would be redeemable in U.S. dollars at the option of bondholders on December 2, 2011 at 99% of the principal amount.
v. Bondholders have the right to require UMC to redeem all or any portion of the bonds at the Early Redemption Price if the ordinary shares of the exchanged securities are officially delisted on the TWSE for a period of five consecutive trading days.
vi. In the event that a change of control as defined in the indenture of the bonds occurs to UMC or Unimicron, the bondholders shall have the right to require UMC to redeem the bonds, in whole or in part, at the Early Redemption Price.
d. Terms of Exchange
i. Underlying Securities: Ordinary shares of Unimicron
ii. Exchange Period: The bonds are exchangeable at any time on or after January 1, 2010 and prior to November 22, 2014, into Unimicron ordinary shares; provided, however, that if the exercise date falls within 5 business days from the beginning of, and during, any closed period, the right of the exchanging holder of the bonds to vote with respect to the shares it receives will be subject to certain restrictions.
iii. Exchange Price and Adjustment: The exchange price was originally NT$51.1875 per share, determined on the basis of a fixed exchange rate ofNTD 32.197=USD 1.00. The exchange price will be subject to adjustments upon the occurrence of certain events set out in the indenture.
37
e. Redemption on the Maturity Date:
The bonds matured on December 2, 2014, and UMC redeemed the bonds at 97.53% of the principal amount. The principal amount of the redeemed bonds was US$127.2 million.
B. On December 2, 2009, UMC issued SGX-ST listed zero coupon exchangeable bonds. The terms and conditions of the bonds are as follows:
a. Issue Amount: US$80 million
b. Period: December 2, 2009 ~ December 2, 2014 (Maturity date)
c. Redemption:
i. UMC may redeem the bonds, in whole or in part, after 12 months of the issuance and prior to the maturity date, at the principal amount of the bonds with an interest calculated at the rate of -0.5% per annum (the Early Redemption Price) if the closing price of the ordinary shares of Novatek Microelectronics Corp., Ltd. (Novatek) on the TWSE, translated into U.S. dollars at the prevailing exchange rate, for a period of 20 consecutive trading days, the last of which occurs not more than 10 days prior to the date upon which notice of such redemption is published, is at least 130% of the exchange price then in effect translated into U.S. dollars at the rate of NTD 32.197=USD 1.00.
ii. UMC may redeem the bonds, in whole, but not in part, at the Early Redemption Price if at least 90% in principal amount of the bonds has already been exchanged, redeemed or purchased and cancelled.
iii. UMC may redeem all, but not part, of the bonds, at the Early Redemption Price at any time, in the event of certain changes in the R.O.C.’s tax rules which would require UMC to gross up for payments of principal, or to gross up for payments of interest or premium.
iv. All, or any portion, of the bonds would be redeemable in U.S. dollars at the option of bondholders on December 2, 2011 at 99% of the principal amount.
v. Bondholders have the right to require UMC to redeem all or any portion of the bonds at the Early Redemption Price if the ordinary shares of the exchanged securities are officially delisted on the TWSE for a period of five consecutive trading days.
vi. In the event that a change of control as defined in the indenture of the bonds occurs to UMC or Novatek, the bondholders shall have the right to require UMC to redeem the bonds, in whole or in part, at the Early Redemption Price.
38
d. Terms of Exchange
i. Underlying Securities: Ordinary shares of Novatek
ii. Exchange Period: The bonds are exchangeable at any time on or after January 1, 2010 and prior to November 22, 2014, into Novatek ordinary shares; provided, however, that if the exercise date falls within 5 business days from the beginning of, and during, any closed period, the right of the exchanging holder of the bonds to vote with respect to the shares it receives will be subject to certain restrictions.
iii. Exchange Price and Adjustment: The exchange price was originally NT$108.58 per share, determined on the basis of a fixed exchange rate of NTD 32.197=USD 1.00. The exchange price will be subject to adjustments upon the occurrence of certain events set out in the indenture.
e. Exchange of the Bonds
As of December 31, 2013, certain bondholders have exercised their rights to exchange their bonds with the total principal amount of US$77 million into Novatek shares. Gains from disposal of investments and gains from exchange of bonds from bondholders exercising exchange rights during the year ended December 31, 2013 amounted NT$1,137 million, and were recognized as non-operating income and expenses.
f. Early Redemption of the Bonds:
Since over 90% principal amount of the bonds has already been exchanged, UMC redeemed the bonds in whole at the Early Redemption Price on July 22, 2013. The remaining principal amount of the redeemed bonds was US$3 million. UMC recognized a gain of NT$45 million from the redemption as non-operating income and expenses.
C. On May 24, 2011, UMC issued SGX-ST listed currency linked zero coupon convertible bonds. The terms and conditions of the bonds are as follows:
a Issue Amount: US$500 million
b. Period: May 24, 2011 ~ May 24, 2016 (Maturity date)
c. Redemption:
i. UMC may redeem the bonds, in whole or in part, after 3 years of the issuanceand prior to the maturity date, at the principal amount of the bonds with an interest calculated at the rate of -0.25% per annum (the Early Redemption Amount) if the closing price of UMC’s ADS on the New York Stock Exchange, for a period of 20 out of 30 consecutive ADS trading days, the last of which occurs not more than 5 ADS trading days prior to the date upon which notice of such redemption is published, is at least 130% of the conversion price. The Early Redemption Price will be converted into NTD based on the Fixed Exchange Rate (NTD 28.846=USD 1.00), and this fixed NTD amount will be converted using the prevailing rate at the time of redemption for payment in USD.
39
ii. UMC may redeem the bonds, in whole, but not in part, at the Early Redemption Amount if at least 90% in principal amount of the bonds has already been converted, redeemed or repurchased and cancelled.
iii. UMC may redeem all, but not part, of the bonds, at the Early Redemption Amount at any time, in the event of certain changes in the R.O.C.’s tax rules which would require UMC to gross up for payments of principal, or to gross up for payments of interest or premium.
iv. All or any portion of the bonds will be redeemable at Early Redemption Amount at the option of bondholders on May 24, 2014 at 99.25% of the principal amount.
v. Bondholders have the right to require UMC to redeem all of the bonds at the Early Redemption Amount if UMC’s ADS cease to be listed or admitted for trading on the New York Stock Exchange, or UMC’s ordinary shares cease to be listed on the Taiwan Stock Exchange.
vi. In the event that a change of control as defined in the indenture of the bonds occurs to UMC, the bondholders shall have the right to require UMC to redeem the bonds, in whole but not in part, at the Early Redemption Amount.
d. Terms of Conversion
i. Underlying Securities: ADS of UMC
ii. Conversion Period: The bonds are convertible at any time on or after July 4, 2011 and prior to May 14, 2016, into UMC’s ADS; provided, however, that if the exercise date falls within 8 business days from the beginning of, and during, any closed period, the right of the converting holder of the bonds to vote with respect to the ADS it receives will be subject to certain restrictions.
iii. Conversion Price and Adjustment: The conversion price was originally USD 3.77 per ADS, determined on the basis of a Fixed Exchange Rate of NTD 28.846=USD 1.00. The conversion price will be subject to adjustments upon the occurrence of certain events set out in the indenture.
40
e. Early Redemption of the Bonds:
UMC redeemed bonds with principal amount of US$324 million as requested by investors on May 27, 2014. The associated convertible rights were deemed cancelled and the consideration paid for the early redemption was fully allocated to the liability components. UMC adjusted the carrying amount of the liability components to reflect actual consideration paid and recognized a loss amount to NT$194 million as non-operating income and expenses. UMC reclassified cancelled convertible rights of NT$441 million from additional paid in capital – stock options to additional paid in capital – others.
As bondholders’ redemption and UMC’s repurchases of bonds from open market in prior year amounted to US$466 million, which represented over 90% principal being redeemed; therefore, UMC redeemed the remaining bonds in whole at the Early Redemption Price on June 27, 2014. The principal amount of the redeemed bonds was US$34 million. UMC recognized a gain of NT$15 million from the redemption as non-operating income and expense.
In accordance with IAS 32, the value of the conversion right of the convertible bonds was determined at issuance and recognized in additional paid-in capital – stock options amounting to NT$680 million, after reduction of issuance costs amounting to NT$3 million. The effective interest rate on the liability component of the convertible bonds was determined to be 0.82%.
D. In early June, 2012, UMC issued a five-year and a seven-year domestic unsecured corporate bonds amounting to NT$10,000 million, with a face value of NT$1 million per unit. The five-year domestic unsecured corporate bond was issued in the amount of NT$7,500 million. Interest will be paid annually at a rate of 1.43%, and the principal will be repayable in June 2017 upon maturity. The seven-year domestic unsecured corporate bond was issued in the amount of NT$2,500 million. Interest will be paid annually at a rate of 1.63%, and the principal will be repayable in June 2019 upon maturity.
E. In mid-March, 2013, UMC issued five-year and seven-year domestic unsecured corporate bonds amounting to NT$10,000 million, with a face value of NT$1 million per unit. The five-year domestic unsecured corporate bond was issued in the amount of NT$7,500 million. Interest will be paid annually at a rate of 1.35%, and the principal will be repayable in March 2018 upon maturity. The seven-year domestic unsecured corporate bond was issued in the amount of NT$2,500 million. Interest will be paid annually at a rate of 1.50%, and the principal will be repayable in March 2020 upon maturity.
F. In mid-June, 2014, UMC issued seven-year and ten-year domestic unsecured corporatebonds amounting to NT$5,000 million, with a face value of NT$1 million per unit. The seven-year domestic unsecured corporate bond was issued in the amount of NT$2,000 million. Interest will be paid annually at a rate of 1.70%, and the principal will be repayable in June 2021 upon maturity. The ten-year domestic unsecured corporate bond was issued in the amount of NT$3,000 million. Interest will be paid annually at a rate of 1.95%, and the principal will be repayable in June 2024 upon maturity.
41
G. On May 18, 2015, UMC issued SGX-ST listed currency linked zero coupon convertible bonds. The terms and conditions of the bonds are as follows:
a Issue Amount: US$600 million
b. Period: May 18, 2015 ~ May 18, 2020 (Maturity date)
c. Redemption:
i. UMC may redeem the bonds, in whole or in part, after 3 years of the issuance and prior to the maturity date, at the principal amount of the bonds with an interest calculated at the rate of -0.25% per annum (the Early Redemption Amount) if the closing price of the ordinary shares of UMC on the TSE, for a period of 20 out of 30 consecutive trading days, the last of which occurs not more than 5 days prior to the date upon which notice of such redemption is published, is at least 125% of the conversion price. The Early Redemption Price will be converted into NTD based on the Fixed Exchange Rate (NTD 30.708=USD 1.00), and this fixed NTD amount will be converted using the prevailing rate at the time of redemption for payment in USD.
ii. UMC may redeem the bonds, in whole, but not in part, at the Early Redemption Amount if at least 90% in principal amount of the bonds has already been converted, redeemed or repurchased and cancelled.
iii. UMC may redeem all, but not part, of the bonds, at the Early Redemption Amount at any time, in the event of certain changes in the R.O.C.’s tax rules which would require UMC to gross up for payments of principal, or to gross up for payments of interest or premium.
iv. All or any portion of the bonds will be redeemable at Early Redemption Amount at the option of bondholders on May 18, 2018 at 99.25% of the principal amount.
v. Bondholders have the right to require UMC to redeem all of the bonds at the Early Redemption Amount if UMC’s ordinary shares cease to be listed on theTaiwan Stock Exchange.
vi. In the event that a change of control as defined in the indenture of the bonds occurs to UMC, the bondholders shall have the right to require UMC to redeem the bonds, in whole but not in part, at the Early Redemption Amount.
42
d. Terms of Conversion
i. Underlying Securities: Ordinary shares of UMC
ii. Conversion Period: The bonds are convertible at any time on or after June 28, 2015 and prior to May 8, 2020, into UMC ordinary shares; provided, however, that if the exercise date falls within 5 business days from the beginning of, and during, any closed period, the right of the converting holder of the bonds to vote with respect to the shares it receives will be subject to certain restrictions.
iii. Conversion Price and Adjustment: The conversion price was originally NT$17.50 per share. The conversion price will be subject to adjustments upon the occurrence of certain events set out in the indenture.
e. Redemption on the Maturity Date: On the maturity date, UMC will redeem the bonds at 98.76% of the principal amount unless, prior to such date:
i. UMC shall have redeemed the bonds at the option of UMC, or the bonds shall have been redeemed at option of the bondholder;
ii. The bondholders shall have exercised the conversion right before maturity; or
iii. The bonds shall have been redeemed or repurchased by UMC and cancelled.
In accordance with IAS 32, the value of the conversion right of the convertible bonds was determined at issuance and recognized in additional paid-in capital – stock options amounting to NT$1,894 million, after reduction of issuance costs amounting to NT$9 million. The effective interest rate on the liability component of the convertible bonds was determined to be 2.03%.
43
(13)Long-Term Loans
a. Details of long-term loans as of June 30, 2015, December 31, 2014 and June 30, 2014 are as follows:
|
| As of |
|
| ||||
Lenders |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
| Redemption |
Secured Long-Term Loan from Mega International Commercial Bank (1) |
| $65,748 |
| $80,358 |
| $94,969 |
| Effective August 1, 2012 to August 1, 2017. Interest-only payment for the first year. Principal is repaid in 17 quarterly payments with monthly interest payments. |
Secured Long-Term Loan from Mega International Commercial Bank (2) |
| 14,000 |
| 16,000 |
| 17,000 |
| Effective November 21, 2013 to November 21, 2018. Interest-only payment for the first year. Principal is repaid in 17 quarterly payments with monthly interest payments. |
Secured Long-Term Loan from Mega International Commercial Bank (3) |
| - |
| - |
| 493,176 |
| Repayable quarterly from June 30, 2011 to June 30, 2016. Principal is repaid in 17 quarterly payments withmonthly interest payments. |
Secured Long-Term Loan from Taiwan Cooperative Bank (1) |
| 70,118 |
| 87,647 |
| 105,176 |
| Effective May 25, 2012 to May 25, 2017. Interest-only payment for the first year. Principal is repaid in 17 quarterly payments with monthly interest payments. |
Secured Long-Term Loan from Taiwan Cooperative Bank (2) |
| 59,529 |
| - |
| - |
| Effective January 10, 2013 to January 10, 2018. Interest-only payment for the first year. Principal is repaid in 17 quarterly payments with monthly interest payments. |
Secured Long-Term Loan from Taiwan Cooperative Bank (3) |
| 73,029 |
| 84,265 |
| 70,000 |
| Effective July 10, 2013 to July 10, 2018. Interest-only payment for the first year. Principal is repaid in 17 quarterly paymentswith monthly interest payments. |
44
|
|
|
|
|
|
|
|
|
|
| As of |
|
| ||||
Lenders |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
| Redemption |
Secured Long-Term Loan from Taiwan Cooperative Bank (4) |
| $19,410 |
| $- |
| $- |
| Effective February 13, 2015 to February 13, 2020. Interest-only payment for the first year. Principal is repaid in 17 quarterly payments with monthly interest payments. |
Secured Long-Term Loan from Taiwan Cooperative Bank (5) |
| 22,750 |
| - |
| - |
| Effective April 28, 2015 to April 28, 2020. Interest-only payment for the first year. Principal is repaid in 17 quarterly payments with monthly interest payments. |
Secured Syndicated Loans from Bank of Taiwan and 7 others |
| - |
| 1,385,000 |
| 1,385,000 |
| Repayable semi-annually from February 7, 2015 to February 7, 2016 with monthly interest payments. |
Secured Syndicated Loans from Taiwan Cooperative Bank and 5 others |
| - |
| 150,000 |
| 300,000 |
| Repayable semi-annually from October 25, 2010 to April 25, 2015 with monthly interest payments. |
Unsecured Long-Term Loan from Bank of Taiwan |
| 3,000,000 |
| 2,700,000 |
| 900,000 |
| Repayable quarterly from October 31, 2015 to July 31, 2017 with monthly interest payments. |
Unsecured Syndicated Loans from Bank of Taiwan and 7 others |
| 1,385,000 |
| - |
| - |
| Repayable semi-annually from February 6, 2017 to February 6, 2020 with monthly interest payments. |
Unsecured Long-Term Loan from Mega International Commercial Bank (1) |
| 615,385 |
| 1,230,769 |
| 1,846,154 |
| Repayable quarterly from December 28, 2012 to December 28, 2015 with monthly interest payments. |
Unsecured Long-Term Loan from Mega International Commercial Bank (2) |
| 1,000,000 |
| 300,000 |
| 300,000 |
| Repayable quarterly from October 4, 2015 to October 4, 2018 with monthly interest payments. |
45
|
|
|
|
|
|
|
|
|
|
| As of |
|
| ||||
Lenders |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
| Redemption |
Unsecured Long-Term Loan from E. Sun Bank |
| $500,000 |
| $500,000 |
| $500,000 |
| Repayable quarterly from December 24, 2015 to December 24, 2017 with monthly interest payments. |
Unsecured Long-Term Loan from Taiwan Cooperative Bank |
| 1,400,000 |
| 1,000,000 |
| 1,000,000 |
| Repayable quarterly from March 24, 2016 to December 24, 2017with monthly interest payments. |
Unsecured Revolving Loan fromCTBC Bank (Note A) |
| 2,000,000 |
| 1,000,000 |
| 1,500,000 |
| Settlement due on August 30, 2016 with monthly interest payments. |
Unsecured Revolving Loan from Chang Hwa Commercial Bank (Note B) |
| 2,000,000 |
| 2,666,667 |
| 1,000,000 |
| Repayable quarterly from December 29, 2014 to December 29, 2016 with monthly interest payments. |
Unsecured Revolving Loan from China Development Industrial Bank (Note C) |
| 1,000,000 |
| 1,000,000 |
| - |
| Settlement due on December 29, 2019 with monthly interest payments. |
Secured Long-Term Loan from Bank of Taiwan |
| - |
| - |
| 808,403 |
| Effective July 13, 2011 to July 13, 2016. Interest-only payment for the first year. Principal is repaid in 16 quarterly paymentswithmonthly interest payments. |
Secured Long-Term Loan from First Commercial Bank (1) |
| - |
| - |
| 232,500 |
| Effective December 31, 2010 to December 31, 2015. Interest-only payment for the first year. Principal is repaid in 8 semi-annual payments withmonthly interest payments. |
Secured Long-Term Loan from First Commercial Bank (2) |
| - |
| - |
| 100,000 |
| Effective June 24, 2011 to June 24, 2016. Interest-only payment for the first year. Principal is repaid in 8 semi-annual payments withmonthly interest payments. |
46
|
|
|
|
|
|
|
|
|
|
| As of |
|
| ||||
Lenders |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
| Redemption |
Secured Long-Term Loan from First Commercial Bank (3) |
| $- |
| $- |
| $50,000 |
| Bullet repayment on May 16, 2015 withmonthly interest payments. |
Secured Long-Term Loan from First Commercial Bank (4) |
| - |
| - |
| 400,000 |
| Bullet repayment on June 27, 2015 withmonthly interest payments. |
Subtotal |
| 13,224,969 |
| 12,200,706 |
| 11,102,378 |
|
|
Less: Administrative expenses from syndicated loans |
| (7,792) |
| (2,250) |
| (3,289) |
|
|
Less: Current portion |
| (3,937,173) |
| (3,774,986) |
| (4,152,398) |
|
|
Total |
| $9,280,004 |
| $8,423,470 |
| $6,946,691 |
|
|
|
|
|
| For the six-month period ended June 30, 2015 |
| For the six-month period ended June 30, 2014 |
Interest Rates |
|
|
| 1.25%~2.95% |
| 1.23%~2.51% |
Note A: UMC entered into a 5-year loan agreement with CTBC Bank, effective from August 30, 2011. The agreement offered UMC a revolving line of credit of NT$2.5 billion starting from the first use of the loan to the expiration date of the agreement, August 30, 2016. As of June 30, 2015, December 31, 2014 and June 30, 2014, the unused line of credit were NT$0.5 billion, NT$1.5 billion and NT$1.0 billion, respectively.
Note B: UMC entered into a 5-year loan agreement with Chang Hwa Commercial Bank, effective from December 29, 2011. The agreement offered UMC a revolving line of credit of NT$3 billion. This line of credit will be reduced starting from the end of the third year after the first use and every three months thereafter, with a total of nine adjustments. The expiration date of the agreement is December 29, 2016. As of June 30, 2015, December 31, 2014 and June 30, 2014, the unused line of credit were nil, nil and NT$2 billion, respectively.
47
Note C: UMC entered into a 5-year loan agreement withChina Development Industrial Bank, effective from September 25, 2014. The agreement offered UMC a revolving line of credit of NT$2 billion. This line of credit will be reduced starting from the end of the second year after the first use and every twelve months thereafter, with a total of four adjustments. The expiration date of the agreement is December 29, 2019. As of June 30, 2015 and December 31, 2014, the unused line of credit were both NT$1 billion.
b. Please refer to Note 8 for property, plant and equipment pledged as collateral for long- term loans.
(14)Post-Employment Benefits
a. Defined contribution plan
The Labor Pension Act of the R.O.C. (the Act) which became effective on July 1, 2005 is a defined contribution plan. Employees can elect to continue to apply the relevant pension rules under the Labor Standards Law of the R.O.C., or to apply the pension rules under the Act and maintain the seniority achieved under the Labor Standards Law. Under the Act, the monthly contributions percentage shall not be less than 6% of these employees’ monthly wages. The Company and its domestic subsidiaries have been making monthly contributions of 6% based on each individual employee’s salary or wage to employees’ pension accounts beginning July 1, 2005. Based on the Act, a total of NT$155 million, NT$147 million, NT$310 million, and NT$291 million were contributed by the Company for thethree-month and six-month periods ended June 30, 2015 and 2014, respectively. Pension benefits for employees of the Singapore branch, and other subsidiaries overseas were provided in accordance with the local regulations, and during thethree-month and six-month periods ended June 30, 2015 and 2014, the Company made total contributions of NT$130 million, NT$110 million, NT$265 million and NT$214 million, respectively.
b. Defined benefit plan
The employee pension plan mandated by the Labor Standards Act of the R.O.C. is a defined benefit plan. The pension benefits are disbursed based on the units of service years and the average monthly salary prior to retirement according to the Labor Standards Act. Two units per year are awarded for the first 15 years of services while one unit per year is awarded after the completion of the 15th year and the total units will not exceed 45 units. The Company contributes an amount equivalent to 2% of the employees’ total salaries and wages on a monthly basis to the pension fund deposited with the Bank of Taiwan under the name of an administered pension fund committee. For the three-month and six-month periods ended June 30, 2015 and 2014, total pension expenses of NT$26 million, NT$28 million, NT$53 million and NT$57 million, respectively, were recognized by the Company.
48
(15)Equity
a. Capital stock:
i. UMC had 26,000 million common shares authorized to be issued as of June 30, 2015, December 31, 2014 and June 30, 2014, of which 12,751 million shares, 12,725 million shares and 12,706 million shares were issued as of June 30, 2015, December 31, 2014 and June 30, 2014, respectively, each at a par value of NT$10.
ii. UMC had 137 million, 150 million and 166 million ADSs, which were traded on the NYSE as of June 30, 2015, December 31, 2014 and June 30, 2014, respectively. The total number of common shares of UMC represented by all issued ADSs were 683 million shares, 749 million shares and 832 million shares as of June 30, 2015, December 31, 2014 and June 30, 2014, respectively. One ADS represents five common shares.
iii. Among the employee stock options issued by UMC on June 19, 2009, 28 million options had been exercised during the six-month period ended June 30, 2015, of which the issuance process for 21 million shares has been approved by the authority, and the share registry has been updated as of June 30, 2015. The remaining 7 million shares were still pending for authorization as of June 30, 2015, thus, they were classified as Capital collected in advance.
iv. Among the employee stock options issued by UMC on June 19, 2009, 12 million options were exercised during the six-month period ended June 30, 2014. The issuance process was completed through the authority.
v. On May 14, 2015 and December 30, 2014, UMC sold 60 million shares and 5 million shares of treasury stock to employees, which were repurchased during the period from March 15 to May 6, 2013, for the purpose of transferring to employees.
b. Treasury stock:
i. UMC carried out treasury stock program, and repurchased its shares from the centralized securities exchange market. The purpose for repurchase, and changes in treasury stock during the six-month periods ended June 30, 2015 and 2014 are as follows:
49
For the six-month period ended June 30, 2015
(In thousands of shares)
Purpose |
| As of January 1, 2015 |
|
Increase |
|
Decrease |
| As of June 30, 2015 |
For transfer to employees |
| 194,510 |
| - |
| 60,286 |
| 134,224 |
For the six-month period ended June 30, 2014
(In thousands of shares)
Purpose |
| As of January 1, 2014 |
|
Increase |
|
Decrease |
| As of June 30, 2014 |
For transfer to employees |
| 200,000 |
| - |
| - |
| 200,000 |
ii. According to the Securities and Exchange Law of the R.O.C., the total shares of treasury stock shall not exceed 10% of UMC’s issued stock, and the total purchase amount shall not exceed the sum of the retained earnings, additional paid-in capital-premiums and realized additional paid-in capital. As such, the maximum number of shares of treasury stock that UMC could hold as of June 30, 2015 and 2014, were 1,275 million shares and 1,271 million shares, with the maximum payments of NT$78,650 million and NT$75,962 million, respectively.
iii. In compliance with Securities and Exchange Law of the R.O.C., treasury stock should not be pledged, nor should it be entitled to voting rights or receiving dividends. Stock held by subsidiaries is treated as treasury stock. These subsidiaries have the same rights as other stockholders except for subscription to new stock issuance and voting rights.
iv. As of June 30, 2015, December 31, 2014 and June 30, 2014, UMC’s subsidiary, FORTUNE VENTURE CAPITAL CORP., held 16 million shares of UMC’s stock. The closing price on June 30, 2015, December 31, 2014 and June 30, 2014, were NT$13.05, NT$14.75 and NT$14.95, respectively.
v. UMC’s subsidiary, FORTUNE VENTURE CAPITAL CORP., held shares of UMC’s stock through acquiring shares of UNITED SILICON INC. in 1997, and these shares were converted to UMC’s stock in 2000 as a result of the Company’s5 in 1 merger.
50
c. Retained earnings and dividend policies:
According to UMC’s Articles of Incorporation, current year’s earnings, if any, shall be distributed in the following order:
i. Payment of all taxes and dues;
ii. Offset prior years’ operation losses;
iii. Appropriate 10% of the remaining amount after deducting items (i) and (ii) as a legal reserve;
iv. Appropriate or reverse special reserve in accordance with relevant laws or regulations, and
v. Appropriate 0.1% of the remaining amount after deducting items (i), (ii), (iii) and (iv) as directors’ remuneration; and
vi. After deducting items (i), (ii), (iii) and (iv) above from the current year’s earnings, no less than 5% of the remaining amount together with the prior years’ unappropriated earnings is to be allocated as employee bonus, which will be settled through issuance of new shares of UMC, or cash. Employees of UMC’s subsidiaries, meeting certain requirements determined by the Board of Directors, are also eligible for the employee stock bonus.
vii. The distribution of the remaining portion, if any, will be recommended by the Board of Directors and resolved in the stockholders’ meeting.
The policy for dividend distribution should reflect factors such as the current and future investment environment, funding requirements, domestic and international competition and capital budgets; as well as the benefit of stockholders, stock dividend equilibrium and long-term financial planning. The Board of Directors shall make the distribution proposal annually and present it at the stockholders’ meeting. UMC’s Articles of Incorporation further provide that at least 20% of the dividends must be paid in the form of cash. Accordingly, no more than 80% of the dividends to stockholders, if any, may be paid in the form of stock dividends.
Based on Article 235-1 of Company Act revised on May 20, 2015, the Company shall distribute a portion of current year’s profit as employees’ compensation after offsetting the cumulative losses, if any. The aforementioned employees’ compensation distributed in the form of shares or in cash shall be resolved by a majority vote at a meeting of board of directors attended by two-thirds of the total number of directors and reported at the stockholders’ meeting. The Company will revise the Articles of Incorporation in accordance with the revised Company Act before June 30, 2016. The employees’ compensation for 2015 will be determined based on the revisedArticles of Incorporation and reported at the stockholders’ meeting.
51
According to the regulations of Taiwan FSC, UMC is required to appropriate a special reserve in the amount equal to the sum of debit elements under equity, such as unrealized loss on financial instruments and negative cumulative translation adjustment, at every year-end. Such special reserve is prohibited from distribution. However, if any of the debit elements is reversed, the special reserve in the amount equal to the reversal may be released for earnings distribution or offsetting accumulated deficit.
The Company estimates the amounts of the employee bonus and remuneration to directors and recognizes them in the profit or loss during the periods earned for the six-month periods ended June 30, 2015 and 2014. The Board of Directors estimated the amount by taking into consideration UMC’s Articles of Incorporation, government regulations and industry averages. If the board subsequently modifies the estimates significantly, UMC will recognize the change as an adjustment in the profit or loss in the same period. The difference between the estimation and the resolution of the stockholders’ meeting will be recognized in profit or loss in the subsequent year. Upon stockholders’ approval, the number of shares distributed as share dividends is calculated based on the total approved bonus amount divided by the closing price one day prior to the approved date with the consideration of the impacts of ex-right/ex-dividend.
The distributions of cash dividend, employee bonus and directors’ remuneration for 2014 and 2013 were approved through the stockholders’ meeting held on June 9, 2015 and June 11, 2014, respectively. The details of distribution are as follows:
|
| 2014 |
| 2013 |
Cash dividend |
| NT$0.55 per share |
| NT$0.01 per share |
Employee bonus – Cash (in thousand NT$) |
| 1,458,956 |
| 1,162,656 |
Directors’ remuneration (in thousand NT$) |
| 10,812 |
| 11,746 |
The stockholders’ meeting held on June 11, 2014 resolved a cash distribution of NT$6,128 million from additional paid-in capital, at approximately NT$0.49 per share.
The aforementioned 2014 and 2013 employee bonuses and remuneration to directorsapproved during stockholders’ meeting, were consistent with the resolutions of meeting of Board of Directors held on March 18, 2015 and April 16, 2014.
52
The aforementioned cash dividend for 2014 increased the outstanding common stock as a result of newly issued shares to settle employee stock options exercised and the treasury shares that the Company transferred to employees. The distribution adjusted to NT$0.54969673 per share according to the resolution of the Board of Directors’ meeting held on June 17, 2015.
Information on the aforementioned employee bonus and remuneration to directors and supervisors can be obtained from the “Market Observation Post System” on the website of the TWSE.
d. Non-controlling interests:
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Balance as of January 1 |
| $3,849,798 |
| $4,319,988 |
Attributable to non-controlling interests: |
|
|
|
|
Net loss |
| (122,773) |
| (225,586) |
Other comprehensive income (loss) |
| (73,797) |
| (1,688) |
Changes in subsidiaries’ ownership |
| 154,932 |
| 59,572 |
Decrease in non-controlling interests |
| (100,400) |
| (11,214) |
Balance as of June 30 |
| $3,707,760 |
| $4,141,072 |
(16)Employee Stock Options
On May 12, 2009, the Company was authorized by the Securities and Futures Bureau of the FSC, to issue employee stock options with a total number of 500 million units each. Each unit entitled an optionee to subscribe to 1 share of the Company’s common stock. Settlement upon the exercise of the options would be made through the issuance of new shares by the Company. The exercise prices of the options were set at the closing prices of the Company’s common stock on the dates of grant. The contractual lives were 6 years and an optionee might exercise the options in accordance with certain schedules as prescribed by the plans after 2 years from the dates of grant. Detailed information relevant to the employee stock options is disclosed as follows:
Date of grant | Total number of options granted (in thousands) | Total number of options outstanding as of June 30, 2015 (in thousands) | Shares available to option holders as of June 30, 2015 (in thousands) | Exercise price (NT$) |
June 19, 2009 | 300,000 | - | - | $10.40 |
Total | 300,000 | - | - |
|
53
a. A summary of the Company’s stock option plan and related information for the six-month periods ended June 30, 2015 and 2014 is as follows:
|
| For thesix-month periods ended June 30, | ||||||||||
|
| 2015 |
| 2014 | ||||||||
|
| Options (in thousands) |
| Shares available to option holders (in thousands) |
| Weighted- average exercise price per share (NTD) |
| Options (in thousands) |
| Shares available to option holders (in thousands) |
| Weighted- average exercise price per share (NTD) |
Outstanding at beginning of period |
| 48,729 |
| 48,729 |
| $10.40 |
| 87,768 |
| 87,768 |
| $10.40 |
Exercised |
| (27,828) |
| (27,828) |
| $10.40 |
| (11,665) |
| (11,665) |
| $10.40 |
Forfeited |
| (469) |
| (469) |
| $10.40 |
| (221) |
| (221) |
| $10.40 |
Expired |
| (20,432) |
| (20,432) |
| $10.40 |
| - |
| - |
| $10.40 |
Outstanding at end of period |
| - |
| - |
| $10.40 |
| 75,882 |
| 75,882 |
| $10.40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Exercisable at end of period |
| - |
| - |
| $10.40 |
| 71,283 |
| 71,283 |
| $10.40 |
b. All employee stock options expired as of June 30, 2015, therefore, both total number of options outstanding and shares available to option holders were zero.
The weighted-average share price at the date of exercise of employee stock options for the six-month periods ended June 30, 2015 and 2014 were NT$14.95 and NT$12.77, respectively.
c. The options granted between January 1, 2004 and December 31, 2007 have all been vested before the transition date to TIFRS (January 1, 2012) and there has not been any modification to the stock option plan. Effective 2008, the compensation expenses related to the Company’s compensatory employee stock option plan were calculated based on fair value. The compensation expenses for the three-month and six-month periods ended June 30, 2015 and 2014 were NT$1 million, NT$0.4 million, NT$1 million and NT$1 million, respectively.
The fair value of the options outstanding as of June 30, 2015 and 2014 were estimated at the date of grant using the Black-Scholes options pricing model with the following weighted-average assumptions. The factors after the adoption of IFRS 2 “Share-basedPayment” to account for share-based payments were as follows:
Items |
| Factors |
Expected dividend yields |
| 1.98% |
Volatility factors of the expected market price of the Company’s common stock |
| 40.63% |
Risk-free interest rate |
| 1.01% |
Weighted-average expected life | 3.16~5.03 years |
54
The aforementioned expected volatility reflects that the assumption that the historical volatility over a period similar to the life of the option is indicative of future trends. The expected option life is based on the historical data of periods for previously granted options. The expected dividend yield is based on historical dividend yield. The risk-free interest rate is based on average interest rate for Taiwan Government Bond over a period similar to the life of the option. The estimates used to calculate the fair value of employee stock option cannot predict future events that are likely to occur or the final amounts employees will benefit from these options. In addition, future events will not affect the reasonableness of the initial calculation for fair value for the stock options. The compensation expenses for the stock options will be adjusted annually for the changes in expected forfeiture rates, with the effects recognized in the current period.
(17)Operating Revenues
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Net sales |
|
|
|
|
Sale of goods |
| $36,727,393 |
| $35,041,306 |
Other operating revenues |
|
|
|
|
Royalty |
| 2,778 |
| - |
Mask tooling |
| 1,052,381 |
| 713,747 |
Others |
| 229,002 |
| 114,298 |
Net operating revenues |
| $38,011,554 |
| $35,869,351 |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Net sales |
|
|
|
|
Sale of goods |
| $73,433,810 |
| $65,788,025 |
Other operating revenues |
|
|
|
|
Royalty |
| 12,172 |
| 2,703 |
Mask tooling |
| 1,860,173 |
| 1,395,481 |
Others |
| 355,043 |
| 376,727 |
Net operating revenues |
| $75,661,198 |
| $67,562,936 |
55
(18)Operating Costs and Expenses
The Company’s personnel, depreciation and amortization expenses are summarized as follows:
|
| For the three-month periods endedJune 30, | ||||||||||
|
| 2015 |
| 2014 | ||||||||
|
| Operating costs |
| Operating expenses |
| Total |
| Operating costs |
| Operating expenses |
| Total |
Personnel expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Salaries |
| $3,747,237 |
| $1,535,680 |
| $5,282,917 |
| $3,383,114 |
| $1,329,288 |
| $4,712,402 |
Labor and health insurance |
| 198,061 |
| 78,637 |
| 276,698 |
| 193,173 |
| 74,409 |
| 267,582 |
Pension |
| 236,221 |
| 74,969 |
| 311,190 |
| 216,565 |
| 69,013 |
| 285,578 |
Other personnel expenses |
| 54,494 |
| 16,199 |
| 70,693 |
| 48,280 |
| 14,003 |
| 62,283 |
Depreciation |
| 10,118,559 |
| 588,005 |
| 10,706,564 |
| 8,943,679 |
| 564,854 |
| 9,508,533 |
Amortization |
| 157,037 |
| 314,832 |
| 471,869 |
| 148,026 |
| 279,271 |
| 427,297 |
|
| For the six-month periods endedJune 30, | ||||||||||
|
| 2015 |
| 2014 | ||||||||
|
| Operating costs |
| Operating expenses |
| Total |
| Operating costs |
| Operating expenses |
| Total |
Personnel expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Salaries |
| $7,673,174 |
| $3,141,038 |
| $10,814,212 |
| $6,760,716 |
| $2,705,097 |
| $9,465,813 |
Labor and health insurance |
| 411,292 |
| 163,917 |
| 575,209 |
| 388,983 |
| 155,378 |
| 544,361 |
Pension |
| 476,717 |
| 157,393 |
| 634,110 |
| 426,226 |
| 135,893 |
| 562,119 |
Other personnel expenses |
| 108,788 |
| 38,728 |
| 147,516 |
| 93,053 |
| 27,817 |
| 120,870 |
Depreciation |
| 19,850,065 |
| 1,151,294 |
| 21,001,359 |
| 17,835,802 |
| 1,109,951 |
| 18,945,753 |
Amortization |
| 317,380 |
| 591,888 |
| 909,268 |
| 310,816 |
| 516,564 |
| 827,380 |
56
(19)Net Other Operating Income and Expenses
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Net rental loss from property |
| $(13,448) |
| $(5,782) |
Gain (Loss) on disposal of property, plant and equipment |
| 30,142 |
| (4,622) |
Total |
| $16,694 |
| $(10,404) |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Net rental loss from property |
| $(23,848) |
| $(8,345) |
Gain on disposal of property, plant and equipment |
| 82,255 |
| 53,398 |
Impairment loss of property, plant and equipment |
| (225,530) |
| - |
Others |
| 41,203 |
| - |
Total |
| $(125,920) |
| $45,053 |
(20)Non-Operating Income and Expenses
a. Other income
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Interest income |
|
|
|
|
Bank deposits |
| $70,785 |
| $130,834 |
Others |
| 18,642 |
| 5,146 |
Dividend income |
| 112,805 |
| 93,616 |
Total |
| $202,232 |
| $229,596 |
57
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Interest income |
|
|
|
|
Bank deposits |
| $136,399 |
| $247,677 |
Others |
| 27,123 |
| 12,581 |
Dividend income |
| 112,805 |
| 94,944 |
Total |
| $276,327 |
| $355,202 |
b. Other gains and losses
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Gain on valuation of financial assets and liabilities at fair value through profit or loss |
|
|
|
|
Designated financial assets at fair value through profit or loss |
| $- |
| $831 |
Financial assets held for trading |
| - |
| 32,132 |
Forward exchange contract |
| 78,466 |
| - |
Loss on valuation of financial assets and liabilities at fair value through profit or loss |
|
|
|
|
Designated financial assets at fair value through profit or loss |
| (2,968) |
| - |
Financial assets held for trading |
| (39,545) |
| - |
Embedded derivative financial liabilities |
| - |
| (979) |
Impairment loss |
|
|
|
|
Available-for-sale financial assets, noncurrent |
| (415,954) |
| (70,692) |
Gain on disposal of investments |
| 1,318,691 |
| 792,027 |
Other gains and losses |
| 318,529 |
| 128,735 |
Total |
| $1,257,219 |
| $882,054 |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Gain on valuation of financial assets and liabilities at fair value through profit or loss |
|
|
|
|
Designated financial assets at fair value through profit or loss |
| $- |
| $4,888 |
Financial assets held for trading |
| 49,357 |
| 44,264 |
Forward exchange contract |
| 122,017 |
| - |
Loss on valuation of financial assets and liabilities at fair value through profit or loss |
|
|
|
|
Designated financial assets at fair value through profit or loss |
| (5,596) |
| - |
Embedded derivative financial liabilities |
| - |
| (1,623) |
Impairment loss |
|
|
|
|
Available-for-sale financial assets, noncurrent |
| (479,044) |
| (71,972) |
Financial assets measured at cost, noncurrent |
| - |
| (91,239) |
Gain on disposal of investments |
| 1,508,388 |
| 1,159,030 |
Other gains and losses |
| 393,636 |
| 232,469 |
Total |
| $1,588,758 |
| $1,275,817 |
58
c. Finance costs
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Interest expenses |
|
|
|
|
Bonds payable |
| $80,360 |
| $227,784 |
Bank loans |
| 55,078 |
| 57,207 |
Others |
| 25 |
| (84) |
Financial expenses |
| 22,346 |
| 17,446 |
Total |
| $157,809 |
| $302,353 |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Interest expenses |
|
|
|
|
Bonds payable |
| $126,807 |
| $319,540 |
Bank loans |
| 109,636 |
| 112,651 |
Others |
| 60 |
| 23 |
Financial expenses |
| 36,040 |
| 25,287 |
Total |
| $272,543 |
| $457,501 |
(21)Components of Other Comprehensive Income (Loss)
|
| For the three-month period ended June 30, 2015 | ||||||||
|
| Arising during the period |
| Reclassification adjustments during the period |
| Other comprehensive income (loss), before tax |
| Income tax effect |
| Other comprehensive income (loss), net of tax |
Items that may be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
|
|
Exchange differences on translation of foreign operations |
| $(1,150,768) |
| $- |
| $(1,150,768) |
| $6,824 |
| $(1,143,944) |
Unrealized gain (loss) on available-for-sale financial assets |
| (2,698,905) |
| (580,258) |
| (3,279,163) |
| 8,231 |
| (3,270,932) |
Share of other comprehensive income (loss) of associates and joint ventures which maybe reclassified subsequently to profit or loss |
| (596,273) |
| - |
| (596,273) |
| 5,224 |
| (591,049) |
Total other comprehensive income (loss) |
| $(4,445,946) |
| $(580,258) |
| $(5,026,204) |
| $20,279 |
| $(5,005,925) |
59
|
| For the three-month period ended June 30, 2014 | ||||||||
|
| Arising during the period |
| Reclassification adjustments during the period |
| Other comprehensive income (loss), before tax |
| Income tax effect |
| Other comprehensive income (loss), net of tax |
Items that may be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
|
|
Exchange differences on translation of foreign operations |
| $(1,464,715) |
| $(869) |
| $(1,465,584) |
| $57,970 |
| $(1,407,614) |
Unrealized gain (loss) on available-for-sale financial assets |
| 1,735,516 |
| (591,100) |
| 1,144,416 |
| 9,171 |
| 1,153,587 |
Share of other comprehensive income (loss) of associates and joint ventures which maybe reclassified subsequently to profit or loss |
| 353,194 |
| (727) |
| 352,467 |
| 4,505 |
| 356,972 |
Total other comprehensive income (loss) |
| $623,995 |
| $(592,696) |
| $31,299 |
| $71,646 |
| $102,945 |
|
| For the six-month period ended June 30, 2015 | ||||||||
|
| Arising during the period |
| Reclassification adjustments during the period |
| Other comprehensive income (loss), before tax |
| Income tax effect |
| Other comprehensive income (loss), net of tax |
Items that may be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
|
|
Exchange differences on translation of foreign operations |
| $(2,041,596) |
| $- |
| $(2,041,596) |
| $18,160 |
| $(2,023,436) |
Unrealized gain (loss) on available-for-sale financial assets |
| (1,952,679) |
| (709,425) |
| (2,662,104) |
| (15,456) |
| (2,677,560) |
Share of other comprehensive income (loss) of associates and joint ventures which maybe reclassified subsequently to profit or loss |
| (417,581) |
| - |
| (417,581) |
| 5,554 |
| (412,027) |
Total other comprehensive income (loss) |
| $(4,411,856) |
| $(709,425) |
| $(5,121,281) |
| $8,258 |
| $(5,113,023) |
60
|
| For the six-month period ended June 30, 2014 | ||||||||
|
| Arising during the period |
| Reclassification adjustments during the period |
| Other comprehensive income (loss), before tax |
| Income tax effect |
| Other comprehensive income (loss), net of tax |
Items that may be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
|
|
Exchange differences on translation of foreign operations |
| $(20,633) |
| $(869) |
| $(21,502) |
| $58,223 |
| $36,721 |
Unrealized gain (loss) on available-for-sale financial assets |
| 4,513,713 |
| (959,820) |
| 3,553,893 |
| (49,887) |
| 3,504,006 |
Share of other comprehensive income (loss) of associates and joint ventures which maybe reclassified subsequently to profit or loss |
| 703,878 |
| (727) |
| 703,151 |
| (10,653) |
| 692,498 |
Total other comprehensive income (loss) |
| $5,196,958 |
| $(961,416) |
| $4,235,542 |
| $(2,317) |
| $4,233,225 |
61
(22)Income Tax
a. The major components of income tax expense for thethree-month and six-month periods ended June 30, 2015 and 2014 were as follows:
i. Income tax expense recorded in profit or loss
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Current income tax expense (benefit): |
|
|
|
|
Current income tax charge |
| $879,146 |
| $539,404 |
Adjustments in respect of current income tax of prior periods |
| (162,000) |
| (517,289) |
Deferred income tax expense (benefit): |
|
|
|
|
Deferred income tax expense (benefit) related to origination and reversal of temporary differences |
| (405,531) |
| (687) |
Deferred income tax related to recognition and derecognition of tax losses and unused tax credits |
| 339,272 |
| 1,325,893 |
Adjustment of prior year’s deferred income tax |
| 5,280 |
| 307,681 |
Deferred tax expense arising from write-down or reversal of write-down of deferred tax assets |
| (20,811) |
| (1,126,665) |
Income tax expense recorded in profit or loss |
| $635,356 |
| $528,337 |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Current income tax expense (benefit): |
|
|
|
|
Current income tax charge |
| $1,449,129 |
| $761,089 |
Adjustments in respect of current income tax of prior periods |
| (168,096) |
| (517,366) |
Deferred income tax expense (benefit): |
|
|
|
|
Deferred income tax expense (benefit) related to origination and reversal of temporary differences |
| (737,763) |
| (43,603) |
Deferred income tax related to recognition and derecognition of tax losses and unused tax credits |
| 534,145 |
| 1,337,456 |
Adjustment of prior year’s deferred income tax |
| 5,280 |
| 307,678 |
Deferred tax expense arising from write-down or reversal of write-down of deferred tax assets |
| (5,701) |
| (1,136,141) |
Income tax expense recorded in profit or loss |
| $1,076,994 |
| $709,113 |
62
ii. Income tax relating to components of other comprehensive income
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Exchange differences on translation of foreign operations |
| $6,824 |
| $57,970 |
Unrealized gain on available-for-sale financial assets |
| 8,231 |
| 9,171 |
Share of other comprehensive income of associates and joint ventures which may be reclassified subsequently to profit or loss |
| 5,224 |
| 4,505 |
Income tax related to items that may be reclassified subsequently to profit or loss |
| $20,279 |
| $71,646 |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Exchange differences on translation of foreign operations |
| $18,160 |
| $58,223 |
Unrealized loss on available-for-sale financial assets |
| (15,456) |
| (49,887) |
Share of other comprehensive income of associates and joint ventures which may be reclassified subsequently to profit or loss |
| 5,554 |
| (10,653) |
Income tax related to items that may be reclassified subsequently to profit or loss |
| $8,258 |
| $(2,317) |
iii. Deferred income tax charged directly to equity
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Temporary differences arising from the initial recognition of the equity component separately from the liability component |
| $(322,001) |
| $82,723 |
Adjustments of changes in net assets of associates and joint ventures accounted for using equity method |
| 479 |
| (2,295) |
Income tax charged directly to equity |
| $(321,522) |
| $80,428 |
63
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Temporary differences arising from the initial recognition of the equity component separately from the liability component |
| $(322,001) |
| $83,185 |
Adjustments of changes in net assets of associates and joint ventures accounted for using equity method |
| 479 |
| (2,294) |
Income tax charged directly to equity |
| $(321,522) |
| $80,891 |
b. A reconciliation between income tax expense and income before tax at UMC’s applicable tax rate was as follows:
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Income before tax |
| $9,534,506 |
| $5,145,646 |
At UMC’s statutory income tax rate of 17% |
| 1,620,866 |
| 874,760 |
Adjustments in respect of current income tax of prior periods |
| (168,096) |
| (517,366) |
Net change in loss carry-forward and investment tax credits |
| 181,852 |
| 187,566 |
Tax effect of deferred tax assets/liabilities |
| (37,364) |
| 280,875 |
Tax effect of non-taxable income and not-deductible expenses: |
|
|
|
|
Tax exempt income |
| (851,998) |
| (91,016) |
Investment gain |
| (347,108) |
| (241,810) |
Dividend income |
| (13,962) |
| (12,785) |
Others |
| 143,503 |
| 109,543 |
Basic tax |
| 1,241 |
| - |
Estimated 10% income tax on unappropriated earnings |
| 398,580 |
| - |
Effect of different tax rates applicable to UMC and its subsidiaries |
| (7,669) |
| (10,874) |
Taxs withheld in other jurisdictions |
| - |
| 15,099 |
Others |
| 157,149 |
| 115,121 |
Income tax expense recorded in profit or loss |
| $1,076,994 |
| $709,113 |
64
c. The Company is subject to taxation in Taiwan and other foreign jurisdictions. As of June 30, 2015, income tax returns of UMC and its subsidiaries in Taiwan have been examined by the tax authorities through 2012 and 2011, respectively, while in other foreign jurisdictions, relevant tax authorities have completed the examination through 2009. UMC has applied for a recheck of the 2012 and 2011 tax returns to the competent tax collection authorities as UMC disagreed with the decision made in the tax assessment notices.
d. Imputation credit information
|
| As of | ||||
|
| June 30,2015 |
| December 31,2014 |
| June 30,2014 |
Balances of imputation credit amounts |
| $2,555,904 |
| $1,332,236 |
| $1,289,048 |
The expected creditable ratio for 2014 and the actual creditable ratio for 2013 were 6.75% and 4.78%, respectively.
e. UMC’s earnings generated in the year ended December 31, 1997 and prior years have been fully appropriated.
(23)Earnings Per Share
a. Earnings per share-basic
Basic earnings per share amounts are calculated by dividing the net income for the year attributable to ordinary equity holders of the parent entity by the weighted average number of ordinary shares outstanding during the year. The reciprocal shareholdings held by subsidiaries are deducted from the computation of weighted-average number ofshares outstanding.
65
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Net profit attributable to the parent company |
| $4,600,375 |
| $3,482,421 |
Weighted-average number of ordinary shares for basic earnings per share (thousand shares) |
| 12,572,497 |
| 12,489,096 |
Earnings per share-basic (NTD) |
| $0.37 |
| $0.28 |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Net profit attributable to the parent company |
| $8,580,285 |
| $4,662,119 |
Weighted-average number of ordinary shares for basic earnings per share (thousand shares) |
| 12,549,507 |
| 12,484,536 |
Earnings per share-basic (NTD) |
| $0.68 |
| $0.37 |
b. Earnings per share-diluted
Diluted earnings per share is calculated by taking basic earnings per share plus the effect of additional common shares that would have been outstanding if the dilutive share equivalents had been issued. The net income attributable to ordinary equity holders of the parent would be also adjusted for the interest and other income or expenses derived from any underlying dilutive share equivalents, such as convertible bonds. For employee bonus that may be distributed in shares, the number of shares to be distributed is taken into consideration assuming the distribution will be made entirely in shares when calculating diluted earnings per share. Additionally, the dilutive effect of outstanding employee options generally should be reflected in diluted earnings per share by application of treasury stock method. The “assumed proceeds” include the exercise price of the options and the average measured but unrecognized compensation expense during the period.
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Net income attributable to the parent company |
| $4,600,375 |
| $3,482,421 |
Effect of dilution |
|
|
|
|
Unsecured convertible bonds |
| 33,555 |
| - |
Income attributable to the Company’s stockholders |
| $4,633,930 |
| $3,482,421 |
Weighted average number of common stocks for basic earnings per share (thousand shares) |
| 12,572,497 |
| 12,489,096 |
Effect of dilution |
|
|
|
|
Employee bonus |
| 137,376 |
| 100,337 |
Employee stock options |
| 3,603 |
| 18,428 |
Unsecured convertible bonds |
| 509,068 |
| - |
Weighted average number of common stocks after dilution (thousand shares) |
| 13,222,544 |
| 12,607,861 |
|
|
|
|
|
Diluted earnings per share (NTD) |
| $0.35 |
| $0.28 |
66
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Net income attributable to the parent company |
| $8,580,285 |
| $4,662,119 |
Effect of dilution |
|
|
|
|
Unsecured convertible bonds |
| 33,555 |
| - |
Income attributable to the Company’s stockholders |
| $8,613,840 |
| $4,662,119 |
Weighted average number of common stocks for basic earnings per share (thousand shares) |
| 12,549,507 |
| 12,484,536 |
Effect of dilution |
|
|
|
|
Employee bonus |
| 151,240 |
| 109,511 |
Employee stock options |
| 7,505 |
| 16,809 |
Unsecured convertible bonds |
| 255,940 |
| - |
Weighted average number of common stocks after dilution (thousand shares) |
| 12,964,192 |
| 12,610,856 |
|
|
|
|
|
Diluted earnings per share (NTD) |
| $0.66 |
| $0.37 |
(24) Business Combinations
Business combinations ofWAVETEK MICROELECTRONICS CORPORATION (WAVETEK) and EPITRON TECHNOLOGY INC. (EPITRON)
In order to integrate research and development resources, reduce operating cost and improve operating performance, WAVETEK’s Board of Directors (WAVETEK, one of the Company’s subsidiaries) resolved to merge with EPITRON on January 26, 2015. Every 3.333 shares of EPITRON was exchanged for one share of WAVETEK. WAVETEK was the surviving companyand the merger date was April 1, 2015.
The fair values of the identifiable assets and liabilities ofEPITRON as of the date of acquisition were:
67
|
| Fair value recognised on acquisition |
Assets |
|
|
Cash and cash equivalents |
| $1,583 |
Inventories |
| 2,275 |
Property, plant and equipment |
| 154,343 |
Intangible assets |
| 11,353 |
Other assets-others |
| 2,416 |
Others |
| 8,832 |
|
| 180,802 |
Liabilities |
|
|
Current portion of long-term liabilities |
| (19,655) |
Long-term loans |
| (65,806) |
Others |
| (2,083) |
|
| (87,544) |
Total identifiable net assets |
| $93,258 |
Goodwill of EPITRON was as follow: |
|
|
|
| Fair value recognised on acquisition |
Consideration Transferred |
| $100,655 |
Less: Fair value of identifiable net assets |
| (93,258) |
Goodwill |
| $7,397 |
If the combination had taken place at the beginning of 2015, revenue from continuing operations would have been NT$75,661 million and the profit before tax from continuing operations for the Company would have been NT$9,518 million for the six-month period ended June 30, 2015.
Consideration Transferred: |
|
|
The fair value of newly issued stocks |
| $100,655 |
|
|
|
Cash flows analysis of acquisition: |
|
|
|
| For the six-month period ended June 30, 2015 |
Cash Consideration |
| $- |
Net cash acquired from the subsidiary |
| 1,583 |
Net cash inflows from acquisition |
| $1,583 |
68
(25)Non-Current Assets Held For Sale (Disposal Group)
TOPCELL SOLAR INTERNATIONAL CO., LTD. (TOPCELL)
In order to integrate resources and reduce operating cost by improving operating performance and expanding economies of scale, TOPCELL’s Board of Directors (TOPCELL, one of the Company’s subsidiaries) resolved to offer a merger with MOTECH INDUSTRIES, INC. (MOTECH) on December 26, 2014. Six shares of TOPCELL were exchanged for one share of MOTECH. MOTECH was the surviving company and the merger date was June 1, 2015. TOPCELL’s assets and liabilities had been reclassified tonon-current assets held for sale as a disposal group on December 31, 2014. This disposal group was classified under new business segment.
Assets and liabilities reclassified to non-current assets held for sale as a disposal group mainly consisted of:
|
|
| As of |
|
|
| December 31,2014 |
Assets |
|
|
|
Cash and cash equivalents |
|
| $511,088 |
Notes and accounts receivable |
|
| 758,839 |
Other receivable |
|
| 77,579 |
Inventories |
|
| 823,249 |
Prepayments |
|
| 325,605 |
Non-current assets held for sale |
|
| 600,663 |
Property, plant and equipment |
|
| 3,821,601 |
Others |
|
| 60,367 |
|
|
| 6,978,991 |
Liabilities |
|
|
|
Short-term loans |
|
| (2,807,292) |
Notes and accounts payable |
|
| (623,501) |
Other payables |
|
| (217,350) |
Payables on equipment |
|
| (158,537) |
Current portion of long-term liabilities |
|
| (1,164,878) |
Other current liabilities |
|
| (205,530) |
Long-term loans |
|
| (417,762) |
|
|
| (5,594,850) |
Net carrying amount of the disposal group |
|
| $1,384,141 |
69
(26)Deconsolidation of Subsidiary
TOPCELL SOLAR INTERNATIONAL CO., LTD. (TOPCELL)
In order to integrate resources and reduce operating cost by improving operating performance and expanding economies of scale, TOPCELL’s Board of Directors (TOPCELL, one of the Company’s subsidiaries) resolved to offer a merger with MOTECH INDUSTRIES, INC. (MOTECH) on December 26, 2014. Six shares of TOPCELL were exchanged for one share of MOTECH. MOTECH was the surviving company and the merger date was June 1, 2015. TOPCELL’s assets and liabilities had been reclassified to non-current assets held for sale as a disposal group on December 31, 2014. This disposal group was classified under new business segment. The Company derecognized therelated assets and liabilities of TOPCELL on June 1, 2015.
a. TOPCELL’s derecognized assets and liabilities mainly consisted of:
|
|
Assets |
|
Cash and cash equivalents | $834,955 |
Notes and accounts receivable | 855,927 |
Other reveivables | 60,638 |
Inventories | 495,726 |
Prepayments | 231,288 |
Property, plant and equipment | 3,862,129 |
Others | 106,714 |
| 6,447,377 |
Liabilities |
|
Short-term loans | (3,488,700) |
Notes and accounts payable | (409,244) |
Other payables | (197,259) |
Payables on equipment | (127,297) |
Current portion of long-term liabilities | (810,878) |
Other current liabilities | (10,107) |
Long-term loans | (176,470) |
| (5,219,955) |
Net carrying amount of the disposal group | $1,227,422 |
b. Consideration received and gain recognized from the transaction:
|
|
|
Stock received-MOTECH |
| $1,495,023 |
Less: Netassets of the subsidiary deconsolidated |
| (1,227,422) |
Add: Non-Controlling Interests |
| 100,400 |
Less: Goodwill |
| (43,072) |
Gain on disposal of the shares of subsidiary |
| $324,929 |
Gain on disposal of the shares of subsidiary for the six-month period ended June 30, 2015 was recognized as non-operating income and expenses in the consolidated statement of comprehensive income.
70
c. Analysis of net cash outflow arising from deconsolidation of the subsidiary
|
|
|
Cash received |
| $- |
Net cash of subsidiary derecognized |
| (834,955) |
Net cash flow from deconsolidation |
| $(834,955) |
ALLIANCE OPTOTEK CORP. (ALLIANCE)
In order to integrate resources and expand operations to improve operating performance and industrial competitiveness, ALLIANCE’s Board of Directors (ALLIANCE, one of the Company’s subsidiaries) resolved merger with WIESON TECHNOLOGIES CO., LTD. (WIESON) on January 23, 2014. WIESON was the surviving company and the mergerdate was June 3, 2014. ALLIANCE’s assets and liabilities had been reclassified to non-current assets held for sale as a disposal group on January 23, 2014 until the Company derecognized the related assets and liabilities of ALLIANCE on June 3, 2014.
a. ALLIANCE’s derecognized assets and liabilities mainly consisted of:
|
|
Assets |
|
Cash and cash equivalents | $15,617 |
Notes and accounts receivable | 14,239 |
Inventories | 24,165 |
Property, plant and equipment | 6,669 |
Others | 6,418 |
| 67,108 |
Liabilities |
|
Payables | (22,984) |
Others | (120) |
| (23,104) |
Net carrying amount of the disposal group | $44,004 |
b. Consideration received and gain recognized from the transaction:
|
|
|
Stock received-WIESON |
| $32,148 |
Less: Netassets of the subsidiary deconsolidated |
| (44,004) |
Add: Non-Controlling Interests |
| 11,214 |
Amounts transferred from other comprehensive income to profit |
| 869 |
Gain on disposal of the shares of subsidiary |
| $227 |
Gain on disposal of the shares of subsidiary for the six-month period ended June 30, 2014 was recognized as non-operating income and expenses in the consolidated statement of comprehensive income.
c. Analysis of net cash outflow arising from deconsolidation of the subsidiary
|
|
|
Cash received |
| $- |
Net cash of subsidiary derecognized |
| (15,617) |
Net cash flow from deconsolidation |
| $(15,617) |
71
7. RELATED PARTY TRANSACTIONS
(1) Significant related party transactions
a. Operating transaction
Operating revenues
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Associates |
| $212,780 |
| $- |
Joint ventures |
| 3,499 |
| 36,137 |
Other related parties (Note A) |
| 2,489 |
| 36,425 |
Total |
| $218,768 |
| $72,562 |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Associates |
| $212,780 |
| $120 |
Joint ventures |
| 7,047 |
| 39,554 |
Other related parties (Note A) |
| 2,955 |
| 42,888 |
Total |
| $222,782 |
| $82,562 |
Note A: Transactions with other related parties are primarily from the operating transactions with SILICON INTEGRATED SYSTEMS CORP. (SIS). The amounts for the three-month and six-month periods ended June 30, 2015 and 2014 were NT$2 million, NT$36 million , NT$3 million and NT$43 million, respectively.
Accounts receivable, net
|
| As of | ||||
|
| June 30,2015 |
| December 31,2014 |
| June 30,2014 |
Associates |
| $222,145 |
| $- |
| $- |
Joint ventures |
| 1,156 |
| 18,164 |
| 38,555 |
Other related parties (Note B) |
| 504 |
| 18,127 |
| 27,604 |
Total |
| 223,805 |
| 36,291 |
| 66,159 |
Less:Allowance for sales returns and discounts |
| (2,970) |
| (269) |
| (126) |
Net |
| $220,835 |
| $36,022 |
| $66,033 |
Note B: Balances of other related parties are accounts receivables primarily from SIS. As of June 30, 2015, December 31, 2014 and June 30, 2014, the balances were NT$1 million, NT$17 million and NT$28 million, respectively.
The sales price to the above related parties was determined through mutual agreement based on the market rates. The collection periods for domestic sales to related parties were month-end 45~60 days, while the term for overseas sales was net 60 days.
72
b. Significant asset transactions
Acquired of intangible assets
|
| Purchase price | ||
|
| For the three-monthperiodendedJune 30, 2015 |
| For the six-month period endedJune 30, 2015 |
Associates |
| $14,459 |
| $14,459 |
Disposal of available-for-sale financial assets, noncurrent
|
|
|
|
|
| For the three-monthperiod ended June 30, 2015 | ||
|
| Transaction Amounts (In thousands of shares) | Transaction underlying |
| Disposal amount |
| Disposal gain | |
Associates |
| 336 |
| DRAMEXCHANGE INC. TECH. |
| $5,400 |
| $2,346 |
|
|
|
|
|
| For the six-monthperiod ended June 30, 2015 | ||
|
| Transaction Amounts (In thousands of shares) | Transaction underlying |
| Disposal amount |
| Disposal gain | |
Associates |
| 336 |
| DRAMEXCHANGE INC. TECH. |
| $5,400 |
| $2,346 |
c. Key management personnel compensation
|
| For the three-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Short-term employee benefits |
| $66,594 |
| $68,736 |
Post-employment benefits |
| 647 |
| 871 |
Share-based payment |
| 5,433 |
| (49) |
Others |
| 139 |
| 115 |
Total |
| $72,813 |
| $69,673 |
|
| For the six-month periods ended June 30, | ||
|
| 2015 |
| 2014 |
Short-term employee benefits |
| $132,679 |
| $129,184 |
Post-employment benefits |
| 1,350 |
| 2,015 |
Termination benefits |
| - |
| 1,029 |
Share-based payment |
| 5,442 |
| (2) |
Others |
| 255 |
| 232 |
Total |
| $139,726 |
| $132,458 |
73
8. ASSETS PLEDGED AS COLLATERAL
As of June 30, 2015, December 31, 2014 and June 30, 2014
|
|
Amount |
|
|
|
| ||||
|
| As of |
|
|
|
| ||||
|
| June 30, 2015 |
| December 31,2014 |
| June 30, 2014 |
| Party to which asset(s) was pledged |
| Purpose of pledge |
Refundable Deposits (Time deposit) |
| $815,119 |
| $815,119 |
| $815,079 |
| Customs |
| Customs duty guarantee |
Refundable Deposits (Time deposit) |
| 190,755 |
| 158,094 |
| 156,658 |
| Science Park Administration |
| Collateral for land lease |
Refundable Deposits (Time deposit) |
| 51,432 |
| 53,202 |
| 52,800 |
| Liquefied Natural Gas Business Division, CPC Corporation, Taiwan |
| Energy resources guarantee |
Refundable Deposits (Time deposit) |
| 870 |
| 870 |
| 870 |
| National Pingtung University of Science and Technology |
| Guarantee for engineering project |
Refundable Deposits (Time deposit) |
| 357 |
| 357 |
| 357 |
| National Pei-men Senior High School |
| Guarantee for engineering project |
Refundable Deposits (Time deposit) |
| 286 |
| 1,246 |
| 1,246 |
| Bureau of Energy, Ministry of Economic Affairs |
| Energy resources guarantee |
Refundable Deposits (Time deposit) |
| - |
| - |
| 1,110 |
| Hsinchu Kuang-Fu high school |
| Cooperative education |
Land |
| - |
| - |
| 600,664 |
| First Commercial Bank |
| Collateral for long-term loans |
Buildings |
| - |
| 1,074,856 |
| 1,117,976 |
| Syndicated Loans from Bank of Taiwan and 7 others and Syndicated Loans from Taiwan Cooperative Bank and 5 others |
| Collateral for long-term loans |
Machinery and equipment |
| 492,926 |
| 4,764,493 |
| 6,016,046 |
| Bank of Taiwan, Cooperative Bank, First Commercial Bank, Mega International Commercial Bank, Syndicated Loans from Bank of Taiwan and 7 others and Syndicated Loans from Taiwan Cooperative Bank and 5 others |
| Collateral for long-term and short-term loans |
Furniture and fixtures |
| - |
| 36,217 |
| 56,713 |
| Syndicated Loans from Bank of Taiwan and 7 others and Syndicated Loans from Taiwan Cooperative Bank and 5 others |
| Collateral for long-term loans |
Construction in progress and equipment awaiting inspection |
| - |
| - |
| 1,267 |
| Bank of Taiwan, First Commercial Bank and Mega International Commercial Bank |
| Collateral for long-term loans |
Total |
| $1,551,745 |
| $6,904,454 |
| $8,820,786 |
|
|
|
|
74
9. SIGNIFICANT CONTINGENCIES AND UNRECOGNIZED CONTRACT COMMITMENTS
(1) The Company entered into several patent license agreements and development contracts of intellectual property for a total contract amount of approximately NT$14 billion. As ofJune 30, 2015, the portion of royalties and development fees not yet recognized is NT$1.4 billion.
(2) The Company entered into several construction contracts for the expansion of its factory premise. As ofJune 30, 2015, these construction contracts amounted to approximately NT$24.9 billion and the portion of the contracts not yet recognized is approximately NT$14.5 billion.
(3) The Company entered into several operating lease contracts for land and office. These renewable operating leases will expire in various years through 2034. Future minimum lease payments under those leases are as follows:
Year |
|
|
| As of June 30, 2015 |
2015 |
|
|
| $191,702 |
2016 |
|
|
| 354,432 |
2017 |
|
|
| 314,358 |
2018 |
|
|
| 258,061 |
2019 |
|
|
| 258,562 |
2020 and thereafter |
|
|
| 2,917,318 |
Total |
|
|
| $4,294,433 |
(4) The Board of Directors of UMC resolved to participate in a 3-way agreement with Xiamen Municipal People’s Government and FUJIAN ELECTRONICS & INFORMATION GROUP to form a company which will focus on 12’’ wafer foundry services. Based on the agreement, UMC will submit an investment application with R.O.C. government authorities for approval to invest in the company established by Xiamen Municipal People’s Government and FUJIAN ELECTRONICS & INFORMATION GROUP. The Company anticipates that its investment could reach approximately US$1.4 billion in the next five years, with instalment funding starting in 2015. On December 31, 2014, UMC obtained R.O.C. government authority’s approval of the investment application for US$0.7billion (including indirect investment). In January 2015, the Company invested RMB 0.6billion and obtained the control over United Semiconductor (XIAMEN) CO., LTD. by acquiring more than half of the seats of the Board of Directors.Furthermore, according to the agreement, UMC recognized a financial liability as other liabilities-others, for repurchase from Xiamen Municipal People’s Government and FUJIAN ELECTRONICS & INFORMATION GROUP their investments in the company at their original investment cost plus interest, beginning from the seventh year following the last instalment payment made by Xiamen Municipal People’s Government and FUJIAN ELECTRONICS & INFORMATION GROUP. However, as stipulated in the agreement, in the event that the regulation of Taiwan does not allow UMC to become the sole owner of the company, UMC will not acquire 10% of Xiamen Municipal People’s Government and FUJIAN ELECTRONICS & INFORMATION GROUP’s investment.
75
10. SIGNIFICANT DISASTER LOSS
None.
11. SIGNIFICANT SUBSEQUENT EVENTS
None.
12. OTHERS
(1) Categories of financial instruments
|
| As of | ||||
Financial Assets |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
Non-derivative financial instruments |
|
|
|
|
|
|
Financial assets at fair value through profit or loss |
|
|
|
|
|
|
Designated financial assets at fair value through profit or loss |
| $222,604 |
| $150,550 |
| $103,086 |
Financial assets held for trading |
| 710,512 |
| 634,811 |
| 879,894 |
Subtotal |
| 933,116 |
| 785,361 |
| 982,980 |
Available-for-sale financial assets |
| 23,517,528 |
| 24,362,104 |
| 25,066,030 |
Financial assets measured at cost |
| 3,835,105 |
| 3,833,006 |
| 3,739,459 |
Loans and receivables |
|
|
|
|
|
|
Cash and cash equivalents (excludes cash on hand) |
| 64,042,264 |
| 45,697,457 |
| 49,630,718 |
Receivables |
| 22,173,837 |
| 23,027,843 |
| 22,355,559 |
Refundable deposits |
| 2,425,899 |
| 1,145,843 |
| 1,215,363 |
Other financial assets, current |
| 3,792,418 |
| 3,134,870 |
| 6,571,717 |
Subtotal |
| 92,434,418 |
| 73,006,013 |
| 79,773,357 |
Derivative financial instruments |
|
|
|
|
|
|
Financial liabilities at fair value through profit or loss |
|
|
|
|
|
|
Forward exchange contracts |
| 12,156 |
| - |
| - |
Total |
| $120,732,323 |
| $101,986,484 |
| $109,561,826 |
|
|
|
|
| ||
|
|
|
|
|
76
|
| As of | ||||
Financial Liabilities |
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
Non-derivative financial instruments |
|
|
|
|
|
|
Financial liabilities at amortized cost |
|
|
|
|
|
|
Short-term loans |
| $1,397,000 |
| $6,250,754 |
| $7,953,800 |
Payables |
| 35,307,476 |
| 29,172,157 |
| 31,998,169 |
Capacity deposit (current portion included) |
| 65,561 |
| 70,200 |
| 86,419 |
Bonds payable (current portion included) |
| 41,467,101 |
| 24,977,820 |
| 28,621,763 |
Long-term loans (current portion included) |
| 13,217,177 |
| 12,198,456 |
| 11,099,089 |
Other financial liabilities-noncurrent |
| 5,975,870 |
| - |
| - |
Subtotal |
| 97,430,185 |
| 72,669,387 |
| 79,759,240 |
Derivative financial instruments |
|
|
|
|
|
|
Financial liabilities at fair value through profit or loss |
|
|
|
|
|
|
Forwardexchangecontracts |
| 7,440 |
| 42,354 |
| - |
Embedded derivative financial liabilities in exchangeable bonds |
| - |
| - |
| 3,805 |
Subtotal |
| 7,440 |
| 42,354 |
| 3,805 |
Total |
| $97,437,625 |
| $72,711,741 |
| $79,763,045 |
(2) Financial risk management objectives and policies
The Company’s risk management objectives are to manage the market risk, credit risk and liquidity risk related to its operating activities. The Company identifies measures and manages the aforementioned risks based on policy and risk preference.
The Company has established appropriate policies, procedures and internal controls for financial risk management. Before entering into significant financial activities, due approval process by the Board of Directors and Audit Committee must be carried out based on related protocols and internal control procedures. The Company complies with its financial risk management policies at all times.
77
(3) Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risks comprise currency risk, interest rate risk, and other price risk (such as equity price risk).
Foreign currency risk
The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s operating activities (when revenue or expense is denominated in a different currency from the Company’s functional currency) and the Company’s net investments in foreign subsidiaries.
The Company applies natural hedges on the foreign currency risk arising from purchases or sales, and utilizes spot or forward exchange contracts to avoid foreign currency risk and the net effect of the risks related to monetary financial assets and liabilities is minor. The notional amounts of the foreign currency contracts are the same as the amount of the hedged items. In principle, the Company does not carry out any forward exchange contracts for uncertain commitments. Furthermore, as net investments in foreign subsidiaries are for strategic purposes, they are not hedged by the Company.
The foreign currency sensitivity analysis of the possible change in foreign exchange rates on the Company’s profit is performed on significant monetary items denominated in foreign currencies as of the end of the reporting period. When NTD strengthens/ weakens against USD by 10%, the profit for the six-month periods ended June 30, 2015 and 2014 decreases/increases by NT$769 million and increases/decreases NT$67 million, respectively.
Interest rate risk
The Company is exposed to interest rate risk arising from borrowing at floating interest rates. All of the Company’s bonds have fixed interest rates and are measured at amortized cost. As such, changes in interest rates would not affect the future cash flows. On the other hand, as the interest rates of the Company’s short-term and long-term bank loans are floating, changes in interest rates would affect the future cash flows but not the fair value. Please refer to Note 6(10), 6(12) and 6(13) for the range of interest rate of the Company’s bonds and bank loans.
At the reporting dates, a change of 10 basis points of interest rate in a reporting period could cause the profit for the six-month periods ended June 30, 2015 and 2014 to decrease/increase by NT$7 million and NT$10 million, respectively.
78
Equity price risk
The Company’s listed and unlisted equity securities are susceptible to market price risk arising from uncertainties about future performance of equity markets. The Company’s listed equity investments are classified as financial assets at fair value through profit or loss and available-for-sale financial assets, while unlisted equity securities are classified as available-for-sale financial assets which are subsequently measured using a valuation model and financial assets measured at cost.
The sensitivity analysis for the equity instruments is based on the change in fair value as of the reporting date. A change of 5% in the price of the aforementioned financial assets at fair value through profit or loss could increase/decrease the Company’s profit for the six-month periods ended June 30, 2015 and 2014 by NT$16 million and NT$24 million, respectively. A change of 5% in the price of the aforementioned available-for-sale financial instrument could increase/decrease the Company’s other comprehensive income for the six-month periods ended June 30, 2015 and 2014 by NT$1,174 million and NT$1,249 million, respectively.
(4) Credit risk management
The Company only trades with approved and creditworthy third parties. Where the Company trades with third parties which have less favorable financial positions, it will request collateral from them. It is the Company’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition, notes and accounts receivable balances are monitored on an ongoing basis, which consequently minimizes the Company’s exposure to bad debts.
The Company mitigates the credit risks from financial institutions by limiting its counter parties to only reputable domestic or international financial institutions with good credit standing and spreading its holdings among various financial institutions. The Company’s exposure to credit risk arising from the default of counter-parties is limited to the carrying amount of these instruments.
As of June 30, 2015, December 31, 2014 and June 30, 2014, accounts receivables from the top ten customers represent 59%, 57% and 51% of the total accounts receivables of the Company, respectively. The credit concentration risk of other accounts receivables is insignificant.
79
(5) Liquidity risk management
The Company’s objectives are to maintain a balance between continuity of funding and flexibility through the use of cash and cash equivalents, bank loans and bonds.
The table below summarizes the maturity profile of the Company’s financial liabilities based on the contractual undiscounted payments and contractual maturity:
|
| As of June 30, 2015 | ||||||||
|
| Less than 1 year |
| 2 to 3 years |
| 4 to 5 years |
| > 5 years |
| Total |
Non-derivative financial liabilities |
|
|
|
|
|
|
|
|
|
|
Short-term loans |
| $1,409,734 |
| $- |
| $- |
| $- |
| $1,409,734 |
Payables |
| 35,149,358 |
| - |
| - |
| 100,083 |
| 35,249,441 |
Capacity deposits |
| 6,180 |
| 59,381 |
| - |
| - |
| 65,561 |
Bonds payable |
| 433,311 |
| 15,614,287 |
| 23,483,324 |
| 5,264,660 |
| 44,795,582 |
Long-term loans |
| 4,129,761 |
| 7,380,550 |
| 2,226,607 |
| 3,828 |
| 13,740,746 |
Other financial liabilities -noncurrent |
| - |
| - |
| - |
| 6,750,111 |
| 6,750,111 |
Total |
| $41,128,344 |
| $23,054,218 |
| $25,709,931 |
| $12,118,682 |
| $102,011,175 |
|
|
|
|
|
|
|
|
|
|
|
Derivative financial liabilities |
|
|
|
|
|
|
|
|
|
|
Forward exchange contracts |
|
|
|
|
|
|
|
|
|
|
Inflow |
| $2,008,678 |
| $- |
| $- |
| $- |
| $2,008,678 |
Outflow |
| (2,016,118) |
| - |
| - |
| - |
| (2,016,118) |
Net |
| $(7,440) |
| $- |
| $- |
| $- |
| $(7,440) |
|
|
|
|
|
|
|
|
|
|
|
|
| As of December 31, 2014 | ||||||||
|
| Less than 1 year |
| 2 to 3 years |
| 4 to 5 years |
| > 5 years |
| Total |
Non-derivative financial liabilities |
|
|
|
|
|
|
|
|
|
|
Short-term loans |
| $6,299,905 |
| $- |
| $- |
| $- |
| $6,299,905 |
Payables |
| 28,816,995 |
| - |
| - |
| 104,952 |
| 28,921,947 |
Capacity deposits |
| - |
| 70,200 |
| - |
| - |
| 70,200 |
Bonds payable |
| 622,936 |
| 8,197,725 |
| 10,339,221 |
| 7,818,618 |
| 26,978,500 |
Long-term loans |
| 3,947,580 |
| 7,528,391 |
| 1,144,247 |
| - |
| 12,620,218 |
Total |
| $39,687,416 |
| $15,796,316 |
| $11,483,468 |
| $7,923,570 |
| $74,890,770 |
|
|
| ||||||||
|
| As of December 31, 2014 | ||||||||
|
| Less than 1 year |
| 2 to 3 years |
| 4 to 5 years |
| > 5 years |
| Total |
Derivative financial liabilities |
|
|
|
|
|
|
|
|
|
|
Forward exchange contracts |
|
|
|
|
|
|
|
|
|
|
Inflow |
| $3,249,080 |
| $- |
| $- |
| $- |
| $3,249,080 |
Outflow |
| (3,291,434) |
| - |
| - |
| - |
| (3,291,434) |
Net |
| $(42,354) |
| $- |
| $- |
| $- |
| $(42,354) |
80
|
| As of June 30, 2014 | ||||||||
|
| Less than 1 year |
| 2 to 3 years |
| 4 to 5 years |
| > 5 years |
| Total |
Non-derivative financial liabilities |
|
|
|
|
|
|
|
|
|
|
Short-term loans |
| $8,006,748 |
| $- |
| $- |
| $- |
| $8,006,748 |
Payables |
| 31,934,609 |
| - |
| - |
| - |
| 31,934,609 |
Capacity deposits |
| - |
| 86,419 |
| - |
| - |
| 86,419 |
Bonds payable |
| 4,143,891 |
| 8,251,350 |
| 10,410,221 |
| 7,883,618 |
| 30,689,080 |
Long-term loans |
| 4,304,505 |
| 6,483,744 |
| 663,656 |
| - |
| 11,451,905 |
Total |
| $48,389,753 |
| $14,821,513 |
| $11,073,877 |
| $7,883,618 |
| $82,168,761 |
(6) Foreign currency risk management
UMC entered into forward exchange contracts for hedging the exchange rate risk arising from the net assets or liabilities denominated in foreign currency. The details of forward exchange contracts entered into by UMC are summarized as follows:
As of June 30, 2015
Type |
| Notional Amount |
| Contract Period |
Forward exchange contracts |
| Sell USD 169 million |
| June 5, 2015~August 6, 2015 |
81
(7) Fair value of financial instruments
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability, or in the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1— Quoted (unadjusted) market prices in active markets for identical assets or liabilities;
Level 2— Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable;
Level 3— Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
For assets and liabilities that are recognized in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchyby re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
82
a. Assets and liabilities measured and recorded at fair value on a recurring basis:
|
| As of June 30, 2015 | ||||||
|
| Level 1 |
| Level 2 |
| Level 3 |
| Total |
Financial assets: |
|
|
|
|
|
|
|
|
Financial assets at fair value through profit or loss, current |
| $710,512 |
| $114,055 |
| $- |
| $824,567 |
Financial assets at fair value through profit or loss, noncurrent |
| - |
| 120,705 |
| - |
| 120,705 |
Available-for-sale financial assets, noncurrent |
| 15,928,802 |
| 159,690 |
| 7,429,036 |
| 23,517,528 |
Financial liabilities: |
|
|
|
|
|
|
|
|
Financial liabilities at fair value through profit or loss, current |
| - |
| 7,440 |
| - |
| 7,440 |
|
| As of December 31, 2014 | ||||||
|
| Level 1 |
| Level 2 |
| Level 3 |
| Total |
Financial assets: |
|
|
|
|
|
|
|
|
Financial assets at fair value through profit or loss, current |
| $634,811 |
| $105,318 |
| $- |
| $740,129 |
Financial assets at fair value through profit or loss, noncurrent |
| - |
| 45,232 |
| - |
| 45,232 |
Available-for-sale financial assets, noncurrent |
| 18,174,030 |
| 170,922 |
| 6,017,152 |
| 24,362,104 |
Financial liabilities: |
|
|
|
|
|
|
|
|
Financial liabilities at fair value through profit or loss, current |
| - |
| 42,354 |
| - |
| 42,354 |
|
| As of June 30, 2014 | ||||||
|
| Level 1 |
| Level 2 |
| Level 3 |
| Total |
|
|
|
|
|
|
|
|
|
Financial assets: |
|
|
|
|
|
|
|
|
Financial assets at fair value through profit or loss, current |
| $879,894 |
| $- |
| $- |
| $879,894 |
Available-for-sale financial assets, current |
| 2,729,361 |
| - |
| - |
| 2,729,361 |
Financial assets at fair value through profit or loss, noncurrent |
| - |
| 103,086 |
| - |
| 103,086 |
Available-for-sale financial assets, noncurrent |
| 18,185,680 |
| 181,973 |
| 3,969,016 |
| 22,336,669 |
Financial liabilities: |
|
|
|
|
|
|
|
|
Financial liabilities at fair value through profit or loss, current |
| - |
| 3,805 |
| - |
| 3,805 |
83
Fair values of financial assets at fair value through profit or loss and available-for-sale financial assets that are categorized into level 1 are based on the quoted market prices in active market. If there is no active market, the Company estimates the fair value by using the market method valuation techniques based on parameters such as recent fund raising activities, valuation of similar companies, individual company’s development, market conditions and other economic indicators. If there are restrictions on the sale or transfer of an available-for-sale financial asset, which are a characteristic of the asset, the fair value of the asset will be determined based on similar but unrestricted financial assets’ quoted market price with appropriate discounts for the restrictions.
TheCompany issued exchangeable bonds which contain a compound derivative instrument, comprising the exchange option with a fixed foreign exchange rate feature and a call option. The compound derivative instrument is classified as liabilities carried at fair value through profit or loss. The derivatives are fair valued using a valuation model. The valuation model uses the market-based observable inputs including share price, volatility, credit spread, and swap rates.
During the six-month periods ended June 30, 2015 and 2014, there were no significant transfers between Level 1 and Level 2 fair value measurements.
Reconciliations for fair value measurement in Level 3 fair value hierarchy were as follows:
|
| Available-for-sale financial assets | ||||||
|
| Common stock |
| Funds |
| Preferred stock |
| Total |
As of January 1, 2015 |
| $5,236,004 |
| $- |
| $781,148 |
| $6,017,152 |
Recognized in profit (loss) |
| (7,774) |
| - |
| - |
| (7,774) |
Recognized in other comprehensive income (loss) |
| 129,033 |
| - |
| 3,367 |
| 132,400 |
Acquisition |
| 1,670,176 |
| 10,324 |
| 268,645 |
| 1,949,145 |
Disposal |
| (20,962) |
| - |
| - |
| (20,962) |
Transfer to Level 3 |
| 14,854 |
| - |
| - |
| 14,854 |
Transfer out of Level 3 |
| (636,174) |
| - |
| - |
| (636,174) |
Exchange effect |
| (8,565) |
| (160) |
| (10,880) |
| (19,605) |
As of June 30, 2015 |
| $6,376,592 |
| $10,164 |
| $1,042,280 |
| $7,429,036 |
|
|
Available-for-sale financial assets | ||||||
|
| Common stock |
| Funds |
| Preferred stock |
| Total |
As of January 1, 2014 |
| $3,517,733 |
| $- |
| $312,600 |
| $3,830,333 |
Recognized in profit (loss) |
| (69,395) |
| - |
| - |
| (69,395) |
Recognized in other comprehensive income (loss) |
| 309,451 |
| - |
| (35,400) |
| 274,051 |
Acquisition |
| 14,000 |
| - |
| - |
| 14,000 |
Disposal |
| (11,716) |
| - |
| - |
| (11,716) |
Transfer to Level 3 |
| 1,492 |
| - |
| - |
| 1,492 |
Transfer out of Level 3 |
| (69,749) |
| - |
| - |
| (69,749) |
As of June 30, 2014 |
| $3,691,816 |
| $- |
| $277,200 |
| $3,969,016 |
84
Recognized as part of profit (loss) above, the loss from financial assets still held by the Company as of June 30, 2015 and 2014 were NT$8 million and NT$69 million, respectively.
Recognized as part of other comprehensive income (loss) above, the income from financial assets still held by the Company as of June 30, 2015 and 2014 were NT$144 million and NT$295 million, respectively.
Transfers between different levels of fair value hierarchy for the financial assets held by the Company were caused by the occurrence of certain events or the change of environment.
b. Assets and liabilities not recorded at fair value on a recurring basis but for which fair value is disclosed:
The fair value of bonds payables is estimated by the market price or estimated using valuation model. The model uses market-based observable inputs including share price, volatility, credit spread and swap rates. The fair value of long-term loans is determined using discounted cash flow model, based on the Company’s current incremental borrowing rates of similar loans.
The fair values of the Company’s short-term financial instruments including cash and cash equivalents, receivables, refundable deposits, other financial assets-current, short-term loans, payables and capacity deposits approximate their carrying amount due to their maturities within one year.
As of June 30, 2015
|
|
|
| Fair value measurements during reporting period using |
|
| ||||
Items |
| Fair value |
| Level 1 |
| Level 2 |
| Level 3 |
| Book value |
Bonds payables (current portion included) |
| $41,718,487 |
| $41,718,487 |
| $- |
| $- |
| $41,467,101 |
Long-term loans (current portion included) |
| 13,217,177 |
| - |
| 13,217,177 |
| - |
| 13,217,177 |
85
(8) Significant assets and liabilities denominated in foreign currencies
| As of | ||||||||||
| June 30, 2015 |
| December 31, 2014 | ||||||||
| Foreign Currency (thousand) |
| Exchange Rate |
| NTD (thousand) |
| Foreign Currency (thousand) |
| Exchange Rate |
| NTD (thousand) |
Financial Assets |
|
|
|
|
|
|
|
|
|
|
|
Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD | $2,068,663 |
| 30.79 |
| $63,689,144 |
| $1,767,638 |
| 31.56 |
| $55,781,155 |
JPY | 6,858,827 |
| 0.2471 |
| 1,694,879 |
| 8,964,201 |
| 0.2610 |
| 2,340,081 |
EUR | 3,461 |
| 34.11 |
| 118,039 |
| 20,071 |
| 38.30 |
| 768,728 |
SGD | 44,282 |
| 22.89 |
| 1,013,639 |
| 38,173 |
| 23.90 |
| 912,326 |
RMB | 1,579,543 |
| 4.95 |
| 7,821,884 |
| 83,347 |
| 5.08 |
| 423,046 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD | 106,756 |
| 30.80 |
| 3,288,110 |
| 85,296 |
| 31.40 |
| 2,678,468 |
CHF | - |
| - |
| - |
| 1,590 |
| 31.97 |
| 50,829 |
JPY | 5,000,000 |
| 0.2508 |
| 1,254,000 |
| - |
| - |
| - |
|
|
|
|
|
|
|
|
|
|
|
|
Financial Liabilities |
|
|
|
|
|
|
|
|
|
|
|
Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD | 493,943 |
| 30.90 |
| 15,262,837 |
| 648,436 |
| 31.67 |
| 20,535,974 |
JPY | 7,126,357 |
| 0.2549 |
| 1,816,508 |
| 9,918,471 |
| 0.2673 |
| 2,651,207 |
EUR | 4,724 |
| 34.71 |
| 163,993 |
| 20,970 |
| 38.75 |
| 812,579 |
SGD | 49,477 |
| 23.07 |
| 1,141,426 |
| 39,493 |
| 24.08 |
| 950,992 |
RMB | 72,013 |
| 5.00 |
| 360,211 |
| 9,737 |
| 5.13 |
| 49,914 |
|
|
|
|
|
|
|
|
|
|
|
|
The exchange gain or loss from monetary financial assets and liabilities |
|
|
|
|
|
|
|
|
|
|
|
USD |
|
|
|
| (41,185) |
|
|
|
|
| 363,831 |
JPY |
|
|
|
| 74,025 |
|
|
|
|
| (45,899) |
EUR |
|
|
|
| (2,689) |
|
|
|
|
| 38,945 |
SGD |
|
|
|
| (13,996) |
|
|
|
|
| (10,838) |
RMB |
|
|
|
| (6,716) |
|
|
|
|
| 9,521 |
Other |
|
|
|
| (75,847) |
|
|
|
|
| (22,285) |
86
|
|
| As of | ||||||||
|
|
| June 30, 2014 | ||||||||
|
|
|
|
|
|
| Foreign Currency (thousand) |
| Exchange Rate |
| NTD (thousand) |
Financial Assets |
|
|
|
|
|
|
|
|
|
|
|
Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD |
|
|
|
|
|
| $1,863,651 |
| 29.80 |
| $55,530,505 |
JPY |
|
|
|
|
|
| 4,218,911 |
| 0.2883 |
| 1,216,439 |
EUR |
|
|
|
|
|
| 48,425 |
| 40.55 |
| 1,963,636 |
SGD |
|
|
|
|
|
| 35,725 |
| 23.85 |
| 852,044 |
RMB |
|
|
|
|
|
| 95,810 |
| 4.78 |
| 458,447 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD |
|
|
|
|
|
| 88,289 |
| 29.81 |
| 2,631,888 |
CHF |
|
|
|
|
|
| 2,190 |
| 33.45 |
| 73,264 |
|
|
|
|
|
|
|
|
|
|
|
|
Financial Liabilities |
|
|
|
|
|
|
|
|
|
|
|
Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD |
|
|
|
|
|
| 700,762 |
| 29.91 |
| 20,959,784 |
JPY |
|
|
|
|
|
| 4,304,857 |
| 0.2968 |
| 1,277,681 |
EUR |
|
|
|
|
|
| 43,288 |
| 40.97 |
| 1,773,491 |
SGD |
|
|
|
|
|
| 46,760 |
| 24.03 |
| 1,123,648 |
RMB |
|
|
|
|
|
| 12,022 |
| 4.84 |
| 58,128 |
|
|
|
|
|
|
|
|
|
|
|
|
The exchange gain or loss from monetary financial assets and liabilities |
|
|
|
|
|
|
|
|
|
|
|
USD |
|
|
|
|
|
|
|
|
|
| 52,614 |
JPY |
|
|
|
|
|
|
|
|
|
| (27,637) |
EUR |
|
|
|
|
|
|
|
|
|
| 3,204 |
SGD |
|
|
|
|
|
|
|
|
|
| (848) |
RMB |
|
|
|
|
|
|
|
|
|
| (7,599) |
Other |
|
|
|
|
|
|
|
|
|
| (1,250) |
87
(9) Significant intercompany transactions among consolidated entities for the six-month periods ended June 30, 2015 and 2014 are disclosed in Attachment 1.
(10) Capital management
The primary objective of the Company’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratios to support its business and maximize the stockholders’ value. The Company also ensures its ability to operate continuously to provide returns to stockholders and the interests of other related parties, while maintaining the optimal capital structure to reduce costs of capital.
To maintain or adjust the capital structure, the Company may adjust the dividend payment to stockholders, return capital to stockholders, issue new shares or dispose assets to redeem liabilities.
Similar to its peers, the Company monitors its capital based on debt to capital ratio. The ratio is calculated as the Company’s net debt divided by its total capital. The net debt is derived by taking the total liabilities on the consolidated balance sheets minus cash and cash equivalents. The total capital consists of total equity (including capital, additional paid-in capital, retained earnings, other components of equity and non-controlling interests) plus net debt.
88
The Company has maintained the same capital management strategy for thesix-month period ended June 30, 2015 as compared to thesix-month period ended June 30, 2014, which is to maintain a reasonable ratio in order to raise capital with reasonable cost. The debt to capital ratios as of June 30, 2015, December 31, 2014 and June 30, 2014 were as follows:
|
| As of | ||||
|
| June 30, 2015 |
| December 31, 2014 |
| June 30, 2014 |
Total liabilities |
| $106,873,131 |
| $88,236,797 |
| $88,685,690 |
Less: Cash and cash equivalents |
| (64,046,049) |
| (45,701,335) |
| (49,634,263) |
Net debt |
| 42,827,082 |
| 42,535,462 |
| 39,051,427 |
Total equity |
| 224,382,487 |
| 225,008,851 |
| 215,112,741 |
Total capital |
| $267,209,569 |
| $267,544,313 |
| $254,164,168 |
Debt to capital ratios |
| 16.03% |
| 15.90% |
| 15.36% |
13. ADDITIONAL DISCLOSURES
(1) The following are additional disclosures for the Company and its affiliates as required by the R.O.C. Securities and Futures Bureau:
a. Financing provided to others for thesix-month period ended June 30, 2015: Please refer to Attachment 2.
b. Endorsement/Guarantee provided to others for thesix-month period ended June 30, 2015: Please refer to Attachment 3.
c. Securities held as ofJune 30, 2015 (excluding subsidiaries, associates and joint venture): Please refer to Attachment 4.
d. Individual securities acquired or disposed of with accumulated amount exceeding the lower of NT$300 million or 20 percent of the capital stock for thesix-month period ended June 30, 2015: Please refer to Attachment 5.
e. Acquisition of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock for thesix-month period ended June 30, 2015: Please refer to Attachment 6.
89
f. Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock for thesix-month period ended June 30, 2015: Please refer to Attachment 7.
g. Related party transactions for purchases and sales amounts exceeding the lower of NT$100 million or 20 percent of the capital stock for thesix-month period ended June 30, 2015: Please refer to Attachment 8.
h. Receivables from related parties with amounts exceeding the lower of NT$100 million or 20 percent of capital stock as ofJune 30, 2015: Please refer to Attachment 9.
i. Names, locations and related information of investees as ofJune 30, 2015(excluding investment in Mainland China): Please refer to Attachment 10.
j. Financial instruments and derivative transactions: Please refer to Note 12.
(2) Investment in Mainland China
a. Investee company name, main businesses and products, total amount of capital, method of investment, accumulated inflow and outflow of investments from Taiwan, net income (loss) of investee company, percentage of ownership, investment income (loss), book value of investments, cumulated inward remittance of earnings and limits on investment in Mainland China: Please refer to Attachment 11.
b. Directly or indirectly significant transactions through third regions with the investees in Mainland China, including price, payment terms, unrealized gain or loss, and other events with significant effects on the operating results and financial condition: None.
14. OPERATING SEGMENT INFORMATION
The Company determined its operating segments based on business activities with discrete financial information regularly reported through the Company’s internal reporting protocols to the Company’s chief operating decision maker. The Company is organized into business units based on its products and services. As ofJune 30, 2015, the Company had the following segments: wafer fabrication and new business. There were no material differences between the accounting policies, described in Note 4, and those applied by the operating segments. The primary operating activity of the wafer fabrication segment is the manufacture of chips to the design specifications of our customers by using our own proprietary processes and techniques. The Company maintains a diversified customer base across industries, including communication, consumer electronics, computer, memory and others, while continuing to focus on manufacturing for high growth, large volume applications, including networking, telecommunications, internet, multimedia, PCs and graphics. New business segment primarily includes researching, developing, manufacturing, and providing solar energy and new generation light-emitting diode (LED).
90
Reportable segment information for the three-month periods ended June 30, 2015 and 2014 were as follows:
|
| For the three-month period ended June 30, 2015 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Net revenue from external customers |
| $36,513,180 |
| $1,498,374 |
| $38,011,554 |
| $- |
| $38,011,554 |
Net revenue from sales among intersegments |
| 9,910 |
| 330,252 |
| 340,162 |
| (340,162) |
| - |
Segment net income (loss), net of tax |
| 4,673,710 |
| (170,485) |
| 4,503,225 |
| 41,815 |
| 4,545,040 |
Capital expenditure |
| 11,935,053 |
| 372,301 |
| 12,307,354 |
| (273,479) |
| 12,033,875 |
Depreciation |
| 10,506,972 |
| 223,934 |
| 10,730,906 |
| (8,640) |
| 10,722,266 |
Share of profit or loss of associates and joint ventures |
| (57,594) |
| 7,242 |
| (50,352) |
| 41,815 |
| (8,537) |
Income tax expense (benefit) |
| 635,778 |
| (422) |
| 635,356 |
| - |
| 635,356 |
Impairment loss |
| 415,639 |
| 315 |
| 415,954 |
| - |
| 415,954 |
|
| For the three-month period ended June 30, 2014 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Net revenue from external customers |
| $32,547,453 |
| $3,321,898 |
| $35,869,351 |
| $- |
| $35,869,351 |
Net revenue from sales among intersegments |
| 17,920 |
| 2,468 |
| 20,388 |
| (20,388) |
| - |
Segment net income (loss), net of tax |
| 3,544,715 |
| (490,662) |
| 3,054,053 |
| 271,673 |
| 3,325,726 |
Capital expenditure |
| 7,750,880 |
| 133,977 |
| 7,884,857 |
| - |
| 7,884,857 |
Depreciation |
| 8,944,186 |
| 577,112 |
| 9,521,298 |
| - |
| 9,521,298 |
Share of profit or loss of associates and joint ventures |
| (101,618) |
| (38,426) |
| (140,044) |
| 271,673 |
| 131,629 |
Income tax expense |
| 523,015 |
| 5,322 |
| 528,337 |
| - |
| 528,337 |
Impairment loss |
| 69,395 |
| 1,297 |
| 70,692 |
| - |
| 70,692 |
91
Reportable segment information for the six-month periods ended June 30, 2015 and 2014 are as follows:
|
| For the six-month period ended June 30, 2015 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Net revenue from external customers |
| $72,490,733 |
| $3,170,465 |
| $75,661,198 |
| $- |
| $75,661,198 |
Net revenue from sales among intersegments |
| 31,851 |
| 331,104 |
| 362,955 |
| (362,955) |
| - |
Segment net income (loss), net of tax |
| 8,707,102 |
| (513,563) |
| 8,193,539 |
| 263,973 |
| 8,457,512 |
Capital expenditure |
| 26,787,694 |
| 412,394 |
| 27,200,088 |
| (273,479) |
| 26,926,609 |
Depreciation |
| 20,610,365 |
| 431,338 |
| 21,041,703 |
| (8,640) |
| 21,033,063 |
Share of profit or loss of associates and joint ventures |
| (215,206) |
| (15,498) |
| (230,704) |
| 263,973 |
| 33,269 |
Income tax expense (benefit) |
| 1,078,209 |
| (1,215) |
| 1,076,994 |
| - |
| 1,076,994 |
Impairment loss |
| 704,259 |
| 315 |
| 704,574 |
| - |
| 704,574 |
|
| For the six-month period ended June 30, 2014 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Net revenue from external customers |
| $61,244,176 |
| $6,318,760 |
| $67,562,936 |
| $- |
| $67,562,936 |
Net revenue from sales among intersegments |
| 33,415 |
| 4,182 |
| 37,597 |
| (37,597) |
| - |
Segment net income (loss), net of tax |
| 4,757,498 |
| (709,024) |
| 4,048,474 |
| 388,059 |
| 4,436,533 |
Capital expenditure |
| 13,974,411 |
| 187,037 |
| 14,161,448 |
| - |
| 14,161,448 |
Depreciation |
| 17,834,247 |
| 1,137,281 |
| 18,971,528 |
| - |
| 18,971,528 |
Share of profit or loss of associates and joint ventures |
| (250,322) |
| (41,489) |
| (291,811) |
| 388,059 |
| 96,248 |
Income tax expense |
| 705,400 |
| 3,713 |
| 709,113 |
| - |
| 709,113 |
Impairment loss |
| 161,914 |
| 1,297 |
| 163,211 |
| - |
| 163,211 |
|
| As of June 30, 2015 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination (Note) |
| Consolidated |
Segment assets |
| $327,792,100 |
| $7,845,898 |
| $335,637,998 |
| $(4,382,380) |
| $331,255,618 |
Segment liabilities |
| $104,362,218 |
| $2,661,181 |
| $107,023,399 |
| $(150,268) |
| $106,873,131 |
92
|
| As of December 31, 2014 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination (Note) |
| Consolidated |
Segment assets |
| $304,022,185 |
| $13,622,342 |
| $317,644,527 |
| $(4,398,879) |
| $313,245,648 |
Segment liabilities |
| $80,166,502 |
| $8,096,635 |
| $88,263,137 |
| $(26,340) |
| $88,236,797 |
|
| As of June 30, 2014 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination (Note) |
| Consolidated |
Segment assets |
| $293,596,674 |
| $15,878,277 |
| $309,474,951 |
| $(5,676,520) |
| $303,798,431 |
Segment liabilities |
| $80,189,630 |
| $8,519,140 |
| $88,708,770 |
| $(23,080) |
| $88,685,690 |
Note: The adjustment primarily consisted of elimination entries for wafer fabrication segment’s investments in new business segment that was accounted for under the equity method.
93
ATTACHMENT 1 (Significant intercompany transactions between consolidated entities) | ||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||
For the six-month period ended June 30, 2015 | ||||||||||||||
Related party | Counterparty | Relationship with the Company | Transactions | |||||||||||
No. | Account | Amount | Terms | Percentage of consolidated operating | ||||||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP (USA) | 1 | Sales | $32,609,557 | Net 60 days | 43% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP (USA) | 1 | Accounts receivable | 7,750,516 | - | 2% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP JAPAN | 1 | Sales | 4,060,991 | Net 60 days | 5% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP JAPAN | 1 | Accounts receivable | 1,521,402 | - | 0% | |||||||
1 | WAVETEK MICROELECTRONICS CORPORATION | UNITED MICROELECTRONICS CORPORATION | 2 | Sales | 327,898 | Net 30 days | 0% | |||||||
1 | WAVETEK MICROELECTRONICS CORPORATION | UNITED MICROELECTRONICS CORPORATION | 2 | Accounts receivable | 118,914 | - | 0% | |||||||
2 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP (USA) | 3 | Sales | 317,403 | Net 60 days | 0% | |||||||
2 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP (USA) | 3 | Accounts receivable | 97,337 | - | 0% | |||||||
For the six-month period ended June 30, 2014 | ||||||||||||||
Related party | Counterparty | Relationship with the Company | Transactions | |||||||||||
No. | Account | Amount | Terms | Percentage of consolidated operating | ||||||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP (USA) | 1 | Sales | $26,795,564 | Net 60 days | 40% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP (USA) | 1 | Accounts receivable | 7,358,265 | - | 2% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP JAPAN | 1 | Sales | 2,587,967 | Net 60 days | 4% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP JAPAN | 1 | Accounts receivable | 1,313,760 | - | 0% | |||||||
Note 1: UMC and its subsidiaries are coded as follows: 1. UMC is coded "0". 2. The subsidiaries are coded consecutively beginning from "1" in the order presented in the table above. | ||||||||||||||
Note 2: Transactions are categorized as follows: 1. The holding company to subsidiary. 2. Subsidiary to holding company. 3. Subsidiary to subsidiary. | ||||||||||||||
Note 3: The sales price to the above related parties was determined through mutual agreement based on the market conditions. | ||||||||||||||
Note 4: The percentage with respect to the consolidated asset/liability for transactions of balance sheet items are based on each item's balance at period-end. | ||||||||||||||
For profit or loss items, cumulative balances are used as basis. |
94
ATTACHMENT 2 (Financing provided to others for the six-month period ended June 30, 2015) | ||||||||||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||||||||||||||||
TERA ENERGY DEVELOPMENT CO., LTD. | ||||||||||||||||||||||||||||||||
Collateral | ||||||||||||||||||||||||||||||||
No. | Lender | Counter-party | Financial statement account | Related Party | Maximum balance for the period | Ending balance | Actual amount provided | Interest rate | Nature of financing | Amount of sales to (purchases from) counter-party | Reason for financing | Allowance for doubtful accounts | Limit of financing amount for individual counter-party (Note2) | Limit of total financing amount (Note2) | ||||||||||||||||||
Item | Value | |||||||||||||||||||||||||||||||
1 | TERA ENERGY DEVELOPMENT CO., LTD. | TIPPING POINT ENERGY COC PPA SPE-1, LLC | Other receivables | No | $2,894 | $2,894 | $2,894 | 9.00% | Need for operating | $2,894 | - | $2,894 | None | $- | $74,314 | $118,903 | ||||||||||||||||
. | ||||||||||||||||||||||||||||||||
NEXPOWER TECHNOLOGY CORPORATION | ||||||||||||||||||||||||||||||||
Collateral | ||||||||||||||||||||||||||||||||
No. | Lender | Counter-party | Financial statement account | Related Party | Maximum balance for the period | Ending balance | Actual amount provided | Interest rate | Nature of financing | Amount of sales to (purchases from) counter-party | Reason for financing | Allowance for doubtful accounts | Limit of financing amount for individual counter-party (Note3) | Limit of total financing amount (Note3) | ||||||||||||||||||
Item | Value | |||||||||||||||||||||||||||||||
1 | NEXPOWER TECHNOLOGY CORPORATION | SOCIALNEX ITALIA 1 S.R.L. | Other receivables - related parties | Yes | $8,578 | $- | $- | 7.00% | Need for operating | $78,265 | - | $- | None | $- | $78,265 | $645,046 | ||||||||||||||||
1 | NEXPOWER TECHNOLOGY CORPORATION | SOCIALNEX ITALIA 1 S.R.L. | Other receivables - related parties | Yes | 6,862 | - | - | 7.00% | The need for short-term financing | - | Business turnover | - | None | - | 80,631 | 645,046 | ||||||||||||||||
Note 1: The parent company and its subsidiaries are coded as follows: | ||||||||||||||||||||||||||||||||
(i) The parent company is coded "0". | ||||||||||||||||||||||||||||||||
(ii) The subsidiaries are coded consecutively beginning from "1" in the order presented in the table above. | ||||||||||||||||||||||||||||||||
Note 2: Limit of financing amount for individual counter-party including guarantee amount shall not exceed 25% of the lender's net assets value as of the period or the needed amount for operation, which is higher. | ||||||||||||||||||||||||||||||||
Limit of total financing amount shall not exceed 40% of the lender's net assets of value as of June 30, 2015. | ||||||||||||||||||||||||||||||||
Note 3: Limit of financing amount for individual counter-party shall not exceed 5% of the lender's net assets value as of the period or the needed amount for operation, which is lower. | ||||||||||||||||||||||||||||||||
Limit of total financing amount shall not exceed 40% of the lender's net assets of value as of June 30, 2015. |
95
ATTACHMENT 3 (Endorsement/Guarantee provided to others for the six-month period ended June 30, 2015) | ||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | ||||||||||||||||||||
No. | Endorsor/Guarantor | Receiving party | Limit of guarantee/endorsement amount for receiving party (Note 3) | Percentage of accumulated guarantee amount to net assets value from the latest financial statement | Limit of total guarantee/endorsement amount (Note 4) | |||||||||||||||
Company name |
| Releationship | Maximum balance for the period | Ending balance | Actual amount | Amount of collateral guarantee/endorsement | ||||||||||||||
0 | UNITED MICROELECTRONICS CORPORATION | NEXPOWER TECHNOLOGY CORPORATION | 3 | $11,033,736 | $3,100,000 | $1,700,000 | $1,385,000 | $- | 0.77% | $44,134,945 | ||||||||||
NEXPOWER TECHNOLOGY CORPORATION | ||||||||||||||||||||
No. | Endorsor/Guarantor | Receiving party | Limit of guarantee/endorsement amount for receiving party (Note 3) | Percentage of accumulated guarantee amount to net assets value from the latest financial statement | Limit of total guarantee/endorsement amount (Note 6) | |||||||||||||||
Company name |
| Releationship | Maximum balance for the period | Ending balance | Actual amount | Amount of collateral guarantee/endorsement | ||||||||||||||
1 | NEXPOWER TECHNOLOGY CORPORATION | SOCIALNEX ITALIA 1 S.R.L. | 2 | $80,631 | $19,137 | $19,137 | $19,137 | $19,137 | 1.19% | $645,046 | ||||||||||
Note 1: The parent company and its subsidiaries are coded as follows: | ||||||||||||||||||||
1. The parent company is coded "0". | ||||||||||||||||||||
2. The subsidiaries are coded consecutively beginning from "1" in the order presented in the table above. | ||||||||||||||||||||
Note 2: According to the "Guidelines Governing the Preparation of Financial Reports by Securities Issuers" issued by the R.O.C. Securities and Futures Bureau,receiving parties should be disclosed as one of the following: | ||||||||||||||||||||
1. A company that has a business relationship with endorsor/guarantor. 2. A subsidary in which endorsor/guarantor holds directly over 50% of equity interest. 3. An investee in which endorsor/guarantor and its subsidiaries hold over 50% of equity interest. 4. An investor which holds directly or indirectly over 50% of equity interest of endorsor/guarantor. 5. A company that has provided guarantees to endorsor/guarantor, and vice versa, due to contractual requirements. 6. An investee in which endorsor/guarantor conjunctly invests with other shareholders, and for which endorsor/guarantor has provided endorsement/guarantee in proportion toits shareholding percentage. | ||||||||||||||||||||
Note 3: The amount of guarantees/endorsements shall not exceed 20% of the net worth of endorsor/guarantor; and the ceilings on the amount of guarantees/endorsements for any single entity are as follows: | ||||||||||||||||||||
1. The amount of guarantees/endorsements for any single entity shall not exceed 5% of net worth of endorsor/guarantor. 2. The amount of guarantees/endorsements for a company which endorsor/guarantor does business with, except the ceiling rules abovementioned shall not exceed the needed amounts arising from business dealings which is the higher | ||||||||||||||||||||
amount of total sales or purchase transactions between endorsor/guarantor and the receiving party. | ||||||||||||||||||||
The aggregate amount of guarantees/endorsements that the Company as a whole is permitted to make shall not exceed 40% of the Company's net worth, and the aggregate amount ofguarantees/endorsements for any single entity | ||||||||||||||||||||
shall not exceed 20% of the Company's net worth. | ||||||||||||||||||||
Note 4: Limit of total guaranteed/endorsed amount shall not exceed 20% of UMC's net assets value as of June 30, 2015. | ||||||||||||||||||||
Note 5: On December 24, 2014, the board of directors resolved to provide endorsement to NEXPOWER TECHNOLOGY CORPORATION's (NEXPOWER) syndicated loan from banks including Bank of Taiwan for the amount up to | ||||||||||||||||||||
NT$1,700 million. | ||||||||||||||||||||
As of June 30, 2015, actual amount provided was NT$1,385 million. | ||||||||||||||||||||
Note 6: Limit of total guaranteed/endorsed amount shall not exceed 40% of NEXPOWER's net assets value as of June 30, 2015. |
96
ATTACHMENT 4 (Securities held as of June 30, 2015) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Bonds | CATHAY FINANCIAL HOLDING CO., LTD. | - | Financial assets at fair value through profit or loss, current | 380 | $385,183 | - | $385,183 | None | ||||||||||
Stock | ACTION ELECTRONICS CO., LTD. | - | Financial assets at fair value through profit or loss, current | 18,182 | 91,638 | 6.44 | 91,638 | None | ||||||||||
Stock | MICRONAS SEMICONDUCTOR HOLDING AG | - | Financial assets at fair value through profit or loss, current | 1,600 | 161,600 | 1.22 | 161,600 | None | ||||||||||
Stock | KING YUAN ELECTRONICS CO., LTD. | - | Financial assets at fair value through profit or loss, current | 2,675 | 72,091 | 0.22 | 72,091 | None | ||||||||||
Stock | SILICON INTEGRATED SYSTEMS CORP. | The Company's director | Available-for-sale financial assets, noncurrent | 120,892 | 767,664 | 19.70 | 767,664 | None | ||||||||||
Stock | UNIMICRON HOLDING LIMITED | - | Available-for-sale financial assets, noncurrent | 20,000 | 646,800 | 17.67 | 646,800 | None | ||||||||||
Stock | UNITED FU SHEN CHEN TECHNOLOGY CORP. | - | Available-for-sale financial assets, noncurrent | 17,511 | - | 15.75 | - | None | ||||||||||
Stock | UNIMICRON TECHNOLOGY CORP. | - | Available-for-sale financial assets, noncurrent | 196,136 | 3,108,756 | 12.75 | 3,108,756 | None | ||||||||||
Stock | HOLTEK SEMICONDUCTOR INC. | - | Available-for-sale financial assets, noncurrent | 25,944 | 1,280,349 | 11.47 | 1,280,349 | None | ||||||||||
Stock | ASIA PACIFIC MICROSYSTEMS, INC. | - | Available-for-sale financial assets, noncurrent | 14,857 | 73,394 | 11.01 | 73,394 | None | ||||||||||
Stock | MIE FUJITSU SEMICONDUCTOR LIMITED | - | Available-for-sale financial assets, noncurrent | 10,000 | 1,254,000 | 9.28 | 1,254,000 | None | ||||||||||
Stock | ITE TECH. INC. | - | Available-for-sale financial assets, noncurrent | 13,960 | 462,075 | 8.84 | 462,075 | None | ||||||||||
Stock | UNITED INDUSTRIAL GASES CO., LTD. | - | Available-for-sale financial assets, noncurrent | 16,680 | 1,340,047 | 7.66 | 1,340,047 | None | ||||||||||
Stock | PROMOS TECHNOLOGIES INC. | - | Available-for-sale financial assets, noncurrent | 164,990 | - | 6.49 | - | None | ||||||||||
Stock | AMIC TECHNOLOGY CORP. | - | Available-for-sale financial assets, noncurrent | 5,627 | - | 4.71 | - | None | ||||||||||
Stock | SUBTRON TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 12,521 | 131,968 | 4.23 | 131,968 | None | ||||||||||
Stock | NOVATEK MICROELECTRONICS CORP. | - | Available-for-sale financial assets, noncurrent | 16,445 | 2,450,243 | 2.70 | 2,450,243 | None | ||||||||||
Stock | KING YUAN ELECTRONICS CO., LTD. | - | Available-for-sale financial assets, noncurrent | 23,158 | 624,100 | 1.94 | 624,100 | None | ||||||||||
Stock | EPISTAR CORP. | - | Available-for-sale financial assets, noncurrent | 10,715 | 441,993 | 0.97 | 441,993 | None | ||||||||||
Stock | TOPOINT TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 1,315 | 33,932 | 0.83 | 33,932 | None | ||||||||||
Stock-Preferred stock | TAIWAN HIGH SPEED RAIL CORP. | - | Available-for-sale financial assets, noncurrent | 30,000 | 300,000 | - | 300,000 | None | ||||||||||
Stock | PIXTECH, INC. | - | Financial assets measured at cost, noncurrent | 9,883 | - | 17.63 | Note | None | ||||||||||
Stock | OCTTASIA INVESTMENT HOLDING INC. | - | Financial assets measured at cost, noncurrent | 6,692 | 196,071 | 9.29 | Note | None | ||||||||||
Stock | EMIVEST AEROSPACE CORP. | - | Financial assets measured at cost, noncurrent | 1,124 | - | 1.50 | Note | None | ||||||||||
Stock-Preferred stock | MTIC HOLDINGS PTE. LTD. | - | Financial assets measured at cost, noncurrent | 12,000 | 263,460 | - | N/A | None | ||||||||||
Stock-Preferred stock | TONBU, INC. | - | Financial assets measured at cost, noncurrent | 938 | - | - | N/A | None |
97
ATTACHMENT 4 (Securities held as of June 30, 2015) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock-Preferred stock | AETAS TECHNOLOGY INC. | - | Financial assets measured at cost, noncurrent | 1,166 | $- | - | N/A | None | ||||||||||
Stock-Preferred stock | TASHEE GOLF & COUNTRY CLUB | - | Financial assets measured at cost, noncurrent | 0 | 60 | - | N/A | None | ||||||||||
Note : The net assets values for unlisted investees classified as "Financial assets measured at cost, noncurrent" were not available as of June 30, 2015. | ||||||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | CLIENTRON CORP. | - | Available-for-sale financial assets, noncurrent | 14,060 | $309,561 | 19.53 | $309,561 | None | ||||||||||
Stock | ACT GENOMICS CO., LTD. | - | Available-for-sale financial assets, noncurrent | 3,600 | 45,000 | 14.17 | 45,000 | None | ||||||||||
Stock | OCULON OPTOELECTRONICS INC. | - | Available-for-sale financial assets, noncurrent | 1,947 | - | 11.73 | - | None | ||||||||||
Stock | BCOM ELECTRONICS INC. | - | Available-for-sale financial assets, noncurrent | 1,572 | 10,886 | 11.73 | 10,886 | None | ||||||||||
Stock | EVERGLORY RESOURCE TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 2,500 | 18,201 | 10.23 | 18,201 | None | ||||||||||
Stock | UWIZ TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 4,530 | 90,102 | 9.14 | 90,102 | None | ||||||||||
Stock | ADVANCE MATERIALS CORP. | - | Available-for-sale financial assets, noncurrent | 11,910 | 109,087 | 8.67 | 109,087 | None | ||||||||||
Stock | AREC INC. | - | Available-for-sale financial assets, noncurrent | 1,109 | 15,080 | 8.34 | 15,080 | None | ||||||||||
Stock | AWISE FIBER TECH.CO.,LTD. | - | Available-for-sale financial assets, noncurrent | 1,519 | 2,628 | 8.31 | 2,628 | None | ||||||||||
Stock | ELE-CON TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 2,530 | 33,270 | 7.83 | 33,270 | None | ||||||||||
Stock | BORA PHARMACEUTICALS CO., LTD. (formerly BORA CORP.) | - | Available-for-sale financial assets, noncurrent | 1,700 | 199,410 | 7.57 | 199,410 | None | ||||||||||
Stock | SHIN-ETSU HANDOTAI TAIWAN CO., LTD. | - | Available-for-sale financial assets, noncurrent | 10,500 | 105,000 | 7.00 | 105,000 | None | ||||||||||
Stock | EXCELLENCE OPTOELECTRONICS INC. | - | Available-for-sale financial assets, noncurrent | 8,529 | 85,291 | 6.62 | 85,291 | None | ||||||||||
Stock | CANDMARK ELECTROPTICS CO., LTD. (formerly CANDMARK ENTERPRISE CO., LTD.) | - | Available-for-sale financial assets, noncurrent | 3,801 | 81,150 | 5.28 | 81,150 | None | ||||||||||
Stock | ACTI CORP. | - | Available-for-sale financial assets, noncurrent | 1,968 | 49,194 | 5.25 | 49,194 | None | ||||||||||
Stock | MERIDIGEN BIOTECH CO., LTD. | - | Available-for-sale financial assets, noncurrent | 3,300 | 66,000 | 5.01 | 66,000 | None | ||||||||||
Stock | ANDES TECHNOLOGY CORP. | - | Available-for-sale financial assets, noncurrent | 1,732 | 97,879 | 4.86 | 97,879 | None | ||||||||||
Stock | LUMITEK CORP. | - | Available-for-sale financial assets, noncurrent | 1,785 | - | 4.81 | - | None | ||||||||||
Stock | AMOD TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 358 | 9,234 | 4.33 | 9,234 | None | ||||||||||
Stock | SOLID STATE SYSTEM CO., LTD. | - | Available-for-sale financial assets, noncurrent | 3,000 | 91,650 | 4.23 | 91,650 | None | ||||||||||
Stock | LUMINESCENCE TECHNOLOGY CORP. | - | Available-for-sale financial assets, noncurrent | 524 | 18,328 | 4.16 | 18,328 | None | ||||||||||
Stock | WALTOP INTERNATIONAL CORP. | - | Available-for-sale financial assets, noncurrent | 1,275 | 9,107 | 4.02 | 9,107 | None | ||||||||||
Stock | MOBILE DEVICES INC. | - | Available-for-sale financial assets, noncurrent | 2,309 | - | 3.96 | - | None |
98
ATTACHMENT 4 (Securities held as of June 30, 2015) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | PRIMESENSOR TECHNOLOGY INC. | - | Available-for-sale financial assets, noncurrent | 1,225 | $5,502 | 3.93 | $5,502 | None | ||||||||||
Stock | DAWNING LEADING TECHNOLOGY INC. | - | Available-for-sale financial assets, noncurrent | 10,133 | 141,862 | 3.78 | 141,862 | None | ||||||||||
Stock | SUBTRON TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 10,129 | 106,757 | 3.43 | 106,757 | None | ||||||||||
Stock | TOPOINT TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 4,907 | 126,596 | 3.08 | 126,596 | None | ||||||||||
Stock | MOTECH INDUSTRIES INC. | - | Available-for-sale financial assets, noncurrent | 11,894 | 435,314 | 2.44 | 435,314 | None | ||||||||||
Stock | SUPERALLOY INDUSTRIAL CO., LTD. | - | Available-for-sale financial assets, noncurrent | 4,603 | 589,153 | 2.31 | 589,153 | None | ||||||||||
Stock | LICO TECHNOLOGY CORP. | - | Available-for-sale financial assets, noncurrent | 2,520 | - | 2.03 | - | None | ||||||||||
Stock | CRYSTALWISE TECHNOLOGY INC. | - | Available-for-sale financial assets, noncurrent | 4,210 | 79,987 | 2.01 | 79,987 | None | ||||||||||
Stock | ALL-STARS XMI LTD. | - | Available-for-sale financial assets, noncurrent | 7 | 212,947 | 1.37 | 212,947 | None | ||||||||||
Stock | WIESON TECHNOLOGIES CO., LTD. | - | Available-for-sale financial assets, noncurrent | 842 | 12,265 | 1.27 | 12,265 | None | ||||||||||
Stock | NIEN MADE ENTERPRISE CO., LTD. | - | Available-for-sale financial assets, noncurrent | 2,698 | 444,012 | 1.19 | 444,012 | None | ||||||||||
Stock | POWERTEC ENERGY CORP. | - | Available-for-sale financial assets, noncurrent | 18,700 | 72,743 | 1.10 | 72,743 | None | ||||||||||
Stock | HIGH POWER OPTOELECTRONICS, INC. | - | Available-for-sale financial assets, noncurrent | 1,530 | - | 0.53 | - | None | ||||||||||
Stock | ASIA PACIFIC MICROSYSTEMS, INC. | - | Available-for-sale financial assets, noncurrent | 475 | 2,344 | 0.35 | 2,344 | None | ||||||||||
Stock | GLOBALWAFERS CO., LTD. | - | Available-for-sale financial assets, noncurrent | 784 | 69,374 | 0.22 | 69,374 | None | ||||||||||
Stock | UNITED MICROELECTRONICS CORP. | Parent company | Available-for-sale financial assets, noncurrent | 16,079 | 209,828 | 0.13 | 209,828 | None | ||||||||||
Stock | DARCHUN VENTURE CORP. | - | Financial assets measured at cost, noncurrent | 3,335 | 33,345 | 19.65 | Note | None | ||||||||||
Stock | GOLDEN TECHNOLOGY VENTURE CAPITAL INVESTMENT CORP. | - | Financial assets measured at cost, noncurrent | 766 | 587 | 10.67 | Note | None | ||||||||||
Stock | RISELINK VENTURE CAPITAL CORP. | - | Financial assets measured at cost, noncurrent | 5,398 | 50,618 | 6.67 | Note | None | ||||||||||
Stock | PARAWIN VENTURE CAPITAL CORP. | - | Financial assets measured at cost, noncurrent | 3,600 | 27,896 | 5.00 | Note | None | ||||||||||
Stock | IBT VENTURE CORP. | - | Financial assets measured at cost, noncurrent | 193 | 450 | 3.81 | Note | None | ||||||||||
Stock | ANIMATION TECHNOLOGIES INC. | - | Financial assets measured at cost, noncurrent | 265 | - | 3.16 | Note | None | ||||||||||
Stock | FIRST INTERNATIONAL TELECOM CORP. | - | Financial assets measured at cost, noncurrent | 4,610 | - | 1.02 | Note | None | ||||||||||
Fund | IGLOBE PARTNERS FUND, L.P. | - | Financial assets measured at cost, noncurrent | - | 12,092 | - | N/A | None | ||||||||||
Stock-Preferred stock | AEVOE INTERNATIONAL LTD. | - | Financial assets measured at cost, noncurrent | 4,170 | 181,286 | - | N/A | None | ||||||||||
Note : The net assets values for unlisted investees classified as "Financial assets measured at cost, noncurrent" were not available as of June 30, 2015. |
99
ATTACHMENT 4 (Securities held as of June 30, 2015) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
TLC CAPITAL CO., LTD. | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Convertible bonds | EASOU HOLDINGS COMPANY LIMITED (formerly YETI GROUP LTD.) | - | Financial assets at fair value through profit or loss, current | - | $101,899 | - | $101,899 | None | ||||||||||
Convertible bonds | WINKING ENTERTAINMENT LTD. | - | Financial assets at fair value through profit or loss, noncurrent | - | 43,705 | - | 43,705 | None | ||||||||||
Convertible bonds | HIGHLANDER FINANCIAL GROUP CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | - | 77,000 | - | 77,000 | None | ||||||||||
Stock | BEAUTY ESSENTIALS INTERNATIONAL LTD. | - | Available-for-sale financial assets, noncurrent | 150,500 | 278,124 | 15.65 | 278,124 | None | ||||||||||
Stock | SUPERALLOY INDUSTRIAL CO., LTD. | - | Available-for-sale financial assets, noncurrent | 9,804 | 1,254,896 | 4.93 | 1,254,896 | None | ||||||||||
Stock | ACTI CORP. | - | Available-for-sale financial assets, noncurrent | 1,500 | 37,500 | 4.00 | 37,500 | None | ||||||||||
Stock | CANDMARK ELECTROPTICS CO., LTD. (formerly CANDMARK ENTERPRISE CO., LTD.) | - | Available-for-sale financial assets, noncurrent | 2,772 | 59,188 | 3.85 | 59,188 | None | ||||||||||
Stock | ASIA PACIFIC MICROSYSTEMS, INC. | - | Available-for-sale financial assets, noncurrent | 4,086 | 20,183 | 3.03 | 20,183 | None | ||||||||||
Stock | WIESON TECHNOLOGIES CO., LTD. | - | Available-for-sale financial assets, noncurrent | 1,775 | 25,849 | 2.67 | 25,849 | None | ||||||||||
Stock | COLAND HOLDINGS LTD. | - | Available-for-sale financial assets, noncurrent | 1,344 | 86,676 | 1.72 | 86,676 | None | ||||||||||
Stock | SIMPLO TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 4,110 | 587,702 | 1.33 | 587,702 | None | ||||||||||
Stock | NIEN MADE ENTERPRISE CO., LTD. | - | Available-for-sale financial assets, noncurrent | 2,698 | 444,012 | 1.19 | 444,012 | None | ||||||||||
Stock | TOPOINT TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 1,859 | 47,956 | 1.17 | 47,956 | None | ||||||||||
Stock | ALL-STARS XMI LTD. | - | Available-for-sale financial assets, noncurrent | 6 | 183,959 | 1.17 | 183,959 | None | ||||||||||
Stock | POWERTEC ENERGY CORP. | - | Available-for-sale financial assets, noncurrent | 18,700 | 72,743 | 1.10 | 72,743 | None | ||||||||||
Stock | TXC CORP. | - | Available-for-sale financial assets, noncurrent | 1,978 | 78,823 | 0.64 | 78,823 | None | ||||||||||
Stock | MONTAGE TECHNOLOGY GLOBAL HOLDINGS, LTD. | - | Available-for-sale financial assets, noncurrent | 125 | 89,516 | 0.41 | 89,516 | None | ||||||||||
Stock | GLOBALWAFERS CO., LTD. | - | Available-for-sale financial assets, noncurrent | 1,084 | 95,906 | 0.31 | 95,906 | None | ||||||||||
Stock | MOTECH INDUSTRIES INC. | - | Available-for-sale financial assets, noncurrent | 1,085 | 39,698 | 0.22 | 39,698 | None | ||||||||||
Stock | CHIPMOS TECHNOLOGIES INC. | - | Available-for-sale financial assets, noncurrent | 1,373 | 56,293 | 0.16 | 56,293 | None | ||||||||||
Stock | CHUNGHWA TELECOM CO., LTD. | - | Available-for-sale financial assets, noncurrent | 2,015 | 198,276 | 0.03 | 198,276 | None | ||||||||||
Stock | KU6 MEDIA CO., LTD. | - | Available-for-sale financial assets, noncurrent | 0.078 | - | 0.00 | - | None | ||||||||||
Stock-Preferred stock | HIGHLANDER FINANCIAL GROUP CO., LTD. | - | Available-for-sale financial assets, noncurrent | 16,663 | 154,000 | - | 154,000 | None | ||||||||||
Stock-Preferred stock | X2 POWER TECHNOLOGIES LIMITED | - | Available-for-sale financial assets, noncurrent | 22,500 | 69,300 | - | 69,300 | None | ||||||||||
Stock | WINKING ENTERTAINMENT LTD. | - | Financial assets measured at cost, noncurrent | 1,461 | 12,996 | - | Note | None | ||||||||||
Stock-Preferred stock | TOUCH MEDIA INTERNATIONAL HOLDINGS | - | Financial assets measured at cost, noncurrent | 7,575 | 293,729 | - | N/A | None | ||||||||||
Stock-Preferred stock | EASOU HOLDINGS COMPANY LIMITED (formerly YETI GROUP LTD.) | - | Financial assets measured at cost, noncurrent | 14,356 | 265,326 | - | N/A | None | ||||||||||
Stock-Preferred stock | WINKING ENTERTAINMENT LTD. | - | Financial assets measured at cost, noncurrent | 4,971 | 198,222 | - | N/A | None | ||||||||||
Stock-Preferred stock | ALO7.COM LTD. | - | Financial assets measured at cost, noncurrent | 2,606 | 183,678 | - | N/A | None | ||||||||||
Stock-Preferred stock | IMO, INC. | - | Financial assets measured at cost, noncurrent | 8,519 | 150,266 | - | N/A | None | ||||||||||
Stock-Preferred stock | YOUJIA GROUP LTD. | - | Financial assets measured at cost, noncurrent | 2,685 | 105,016 | - | N/A | None | ||||||||||
Stock-Preferred stock | ADWO MEDIA HOLDINGS LTD. | - | Financial assets measured at cost, noncurrent | 6,664 | 109,821 | - | N/A | None | ||||||||||
Stock-Preferred stock | IAPPPAY TECHNOLOGY LTD. | - | Financial assets measured at cost, noncurrent | 1,004 | 103,355 | - | N/A | None | ||||||||||
Fund | H&QAP GREATER CHINA GROWTH FUND, L.P. | - | Financial assets measured at cost, noncurrent | - | 24,947 | - | N/A | None | ||||||||||
Note : The net assets values for unlisted investees classified as "Financial assets measured at cost, noncurrent" were not available as of June 30, 2015. |
100
ATTACHMENT 4 (Securities held as of June 30, 2015) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
UNITRUTH INVESTMENT CORP. | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | OCULON OPTOELECTRONICS INC. | - | Available-for-sale financial assets, noncurrent | 1,288 | $- | 7.77 | $- | None | ||||||||||
Stock | BCOM ELECTRONICS INC. | - | Available-for-sale financial assets, noncurrent | 1,030 | 7,130 | 7.68 | 7,130 | None | ||||||||||
Stock | AREC INC. | - | Available-for-sale financial assets, noncurrent | 986 | 13,404 | 7.41 | 13,404 | None | ||||||||||
Stock | UWIZ TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 3,410 | 67,818 | 6.88 | 67,818 | None | ||||||||||
Stock | AWISE FIBER TECH.CO.,LTD. | - | Available-for-sale financial assets, noncurrent | 1,089 | 1,883 | 5.95 | 1,883 | None | ||||||||||
Stock | EXCELLENCE OPTOELECTRONICS INC. | - | Available-for-sale financial assets, noncurrent | 6,374 | 63,739 | 4.94 | 63,739 | None | ||||||||||
Stock | EVERGLORY RESOURCE TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 1,200 | 8,736 | 4.91 | 8,736 | None | ||||||||||
Stock | ADVANCE MATERIALS CORP. | - | Available-for-sale financial assets, noncurrent | 6,039 | 55,311 | 4.39 | 55,311 | None | ||||||||||
Stock | AMOD TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 314 | 8,101 | 3.80 | 8,101 | None | ||||||||||
Stock | ELE-CON TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 1,190 | 15,654 | 3.69 | 15,654 | None | ||||||||||
Stock | CANDMARK ELECTROPTICS CO., LTD. (formerly CANDMARK ENTERPRISE CO., LTD.) | - | Available-for-sale financial assets, noncurrent | 2,037 | 43,497 | 2.83 | 43,497 | None | ||||||||||
Stock | TAIWANJ PHARMACEUTICALS CO., LTD. | - | Available-for-sale financial assets, noncurrent | 1,000 | 21,460 | 2.22 | 21,460 | None | ||||||||||
Stock | WALTOP INTERNATIONAL CORP. | - | Available-for-sale financial assets, noncurrent | 687 | 4,906 | 2.17 | 4,906 | None | ||||||||||
Stock | ACTI CORP. | - | Available-for-sale financial assets, noncurrent | 752 | 18,789 | 2.01 | 18,789 | None | ||||||||||
Stock | LUMITEK CORP. | - | Available-for-sale financial assets, noncurrent | 683 | - | 1.84 | - | None | ||||||||||
Stock | MOBILE DEVICES INC. | - | Available-for-sale financial assets, noncurrent | 300 | - | 0.51 | - | None | ||||||||||
Stock | WIESON TECHNOLOGIES CO., LTD. | - | Available-for-sale financial assets, noncurrent | 266 | 3,866 | 0.40 | 3,866 | None | ||||||||||
Stock | SUPERALLOY INDUSTRIAL CO., LTD. | - | Available-for-sale financial assets, noncurrent | 583 | 74,609 | 0.29 | 74,609 | None | ||||||||||
Stock | HIGH POWER OPTOELECTRONICS, INC. | - | Available-for-sale financial assets, noncurrent | 510 | - | 0.18 | - | None | ||||||||||
Stock | ASIA PACIFIC MICROSYSTEMS, INC. | - | Available-for-sale financial assets, noncurrent | 247 | 1,219 | 0.18 | 1,219 | None | ||||||||||
Stock | NIEN MADE ENTERPRISE CO., LTD. | - | Available-for-sale financial assets, noncurrent | 284 | 46,738 | 0.13 | 46,738 | None | ||||||||||
Stock | CLIENTRON CORP. | - | Available-for-sale financial assets, noncurrent | 80 | 1,761 | 0.11 | 1,761 | None | ||||||||||
Stock | MOTECH INDUSTRIES INC. | - | Available-for-sale financial assets, noncurrent | 469 | 17,173 | 0.10 | 17,173 | None | ||||||||||
101
ATTACHMENT 4 (Securities held as of June 30, 2015) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
UMC CAPITAL CORP. | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Capital | TRANSLINK MANAGEMENT III, L.L.C. | - | Available-for-sale financial assets, noncurrent | - | USD | 49 | 16.00 | USD | 49 | None | ||||||||
Stock | ALL-STARS SP IV LTD. | - | Available-for-sale financial assets, noncurrent | 7 | USD | 6,500 | 6.01 | USD | 6,500 | None | ||||||||
Fund | STORM VENTURES FUND V, L.P. | - | Available-for-sale financial assets, noncurrent | - | USD | 330 | 1.69 | USD | 330 | None | ||||||||
Stock | MOBILE IRON, INC. | - | Available-for-sale financial assets, noncurrent | 1,205 | USD | 7,118 | 1.54 | USD | 7,118 | None | ||||||||
Stock | ALL-STARS XMI LTD. | - | Available-for-sale financial assets, noncurrent | 7 | USD | 6,968 | 1.37 | USD | 6,968 | None | ||||||||
American | CHUNGHWA TELECOM CO., LTD. | - | Available-for-sale financial assets, noncurrent | 200 | USD | 6,378 | 0.03 | USD | 6,378 | None | ||||||||
Stock-Preferred stock | CNEX LABS, INC. | - | Available-for-sale financial assets, noncurrent | 2,495 | USD | 4,350 | - | USD | 4,350 | None | ||||||||
Stock-Preferred stock | GLYMPSE, INC. | - | Available-for-sale financial assets, noncurrent | 1,159 | USD | 4,000 | - | USD | 4,000 | None | ||||||||
Stock-Preferred stock | ATSCALE, INC. | - | Available-for-sale financial assets, noncurrent | 4,374 | USD | 2,500 | - | USD | 2,500 | None | ||||||||
Stock-Preferred stock | INEDA SYSTEMS, INC. | - | Available-for-sale financial assets, noncurrent | 6,545 | USD | 6,000 | - | USD | 6,000 | None | ||||||||
Stock | OCTTASIA INVESTMENT HOLDING INC. | - | Financial assets measured at cost, noncurrent | 7,035 | USD | 7,035 | - | Note | None | |||||||||
Stock | CIPHERMAX, INC. | - | Financial assets measured at cost, noncurrent | 95 | - | - | Note | None | ||||||||||
Stock-Preferred stock | GCT SEMICONDUCTOR, INC. | - | Financial assets measured at cost, noncurrent | 175 | USD | 1,000 | - | N/A | None | |||||||||
Stock-Preferred stock | FORTEMEDIA, INC. | - | Financial assets measured at cost, noncurrent | 12,241 | USD | 5,828 | - | N/A | None | |||||||||
Stock-Preferred stock | SIFOTONICS TECHNOLOGIES CO., LTD. | - | Financial assets measured at cost, noncurrent | 3,500 | USD | 3,000 | - | N/A | None | |||||||||
Stock-Preferred stock | NEVO ENERGY, INC. (formerly SOLARGEN ENERGY INC.) | - | Financial assets measured at cost, noncurrent | 4,980 | USD | 4,980 | - | N/A | None | |||||||||
Stock-Preferred stock | TRILLIANT HOLDINGS, INC. | - | Financial assets measured at cost, noncurrent | 4,000 | USD | 5,000 | - | N/A | None | |||||||||
Stock-Preferred stock | SWIFTSTACK, INC. | - | Financial assets measured at cost, noncurrent | 2,140 | USD | 3,208 | - | N/A | None | |||||||||
Stock-Preferred stock | THISMOMENT, INC. | - | Financial assets measured at cost, noncurrent | 4,064 | USD | 4,008 | - | N/A | None | |||||||||
Stock-Preferred stock | NEXENTA SYSTEMS, INC. | - | Financial assets measured at cost, noncurrent | 3,525 | USD | 4,019 | - | N/A | None | |||||||||
Stock-Preferred stock | ALPINE ANALYTICS, INC. | - | Financial assets measured at cost, noncurrent | 1,749 | USD | 4,500 | - | N/A | None | |||||||||
Stock-Preferred stock | CLOUDWORDS, INC. | - | Financial assets measured at cost, noncurrent | 4,191 | USD | 5,000 | - | N/A | None | |||||||||
Stock-Preferred stock | ZYLOGIC SEMICONDUCTOR CORP. | - | Financial assets measured at cost, noncurrent | 750 | - | - | N/A | None | ||||||||||
Stock-Preferred stock | WISAIR, INC. | - | Financial assets measured at cost, noncurrent | 173 | - | - | N/A | None | ||||||||||
Stock-Preferred stock | EAST VISION TECHNOLOGY LTD. | - | Financial assets measured at cost, noncurrent | 2,770 | - | - | N/A | None | ||||||||||
Stock-Preferred stock | EV2 HOLDINGS, INC. (formerly ENVERV, INC.) | - | Financial assets measured at cost, noncurrent | 1,621 | - | - | N/A | None | ||||||||||
Fund | VENGLOBAL CAPITAL FUND III, L.P. | - | Financial assets measured at cost, noncurrent | - | USD | 651 | - | N/A | None | |||||||||
Fund | TRANSLINK CAPITAL PARTNERS II, L.P. | - | Financial assets measured at cost, noncurrent | - | USD | 2,575 | - | N/A | None | |||||||||
Note : The net assets values for unlisted investees classified as "Financial assets measured at cost, noncurrent" were not available as of June 30, 2015. |
102
ATTACHMENT 4 (Securities held as of June 30, 2015) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
UMC NEW BUSINESS INVESTMENT CORP. | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | SOLARGATE TECHNOLOGY CORPORATION | - | Available-for-sale financial assets, noncurrent | 957 | $- | 15.94 | $- | None | ||||||||||
Stock | WIN WIN PRECISION TECHNOLOGY CO., LTD. | - | Available-for-sale financial assets, noncurrent | 3,150 | 39,060 | 6.93 | 39,060 | None | ||||||||||
Stock | MOTECH INDUSTRIES, INC. | - | Available-for-sale financial assets, noncurrent | 28,498 | 1,043,043 | 5.85 | 1,043,043 | None | ||||||||||
Stock | LICO TECHNOLOGY CORPORATION | - | Available-for-sale financial assets, noncurrent | 4,089 | - | 3.29 | - | None | ||||||||||
Stock | POWERTEC ENERGY CORPORATION | - | Available-for-sale financial assets, noncurrent | 10,000 | 38,900 | 0.59 | 38,900 | None | ||||||||||
Fund | PAMIRS FUND SEGREGATED PORTFOLIO II | - | Available-for-sale financial assets, noncurrent | - | 68,040 | - | 68,040 | None | ||||||||||
TERA ENERGY DEVELOPMENT CO., LTD. | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | TIAN TAI YI ENERGY CO., LTD. | - | Financial assets measured at cost-noncurrent | 437 | $4,367 | 5.56 | Note | None | ||||||||||
Note : The net assets values for unlisted investees classified as "Financial assets measured at cost, noncurrent" were not available as of June 30, 2015. | ||||||||||||||||||
EVERRICH (SHANDONG) ENERGY CO., LTD. | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Capital | GOLMUD SOLARGIGA ENERGY ELECTRIC POWER CO., LTD. | - | Financial assets measured at cost, noncurrent | - | RMB | 10,000 | 10.00 | Note | None | |||||||||
Note : The net assets values for unlisted investees classified as "Financial assets measured at cost, noncurrent" were not available as of June 30, 2015. | ||||||||||||||||||
NEXPOWER TECHNOLOGY CORPORATION | ||||||||||||||||||
June 30, 2015 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Book value | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | PACIFIC-GREEN INTEGRATED TECHNOLOGY INC. | - | Financial assets measured at cost-noncurrent | 54 | $3,244 | 18.00 | Note | None | ||||||||||
Note : The net assets values for unlisted investees classified as "Financial assets measured at cost, noncurrent" were not available as of June 30, 2015. |
103
ATTACHMENT 5 (Individual securities acquired or disposed of with accumulated amount exceeding the lower of NT$300 million or 20 percent of the capital stock for the six-month period ended June 30, 2015) | |||||||||||||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | |||||||||||||||||||||||||||||||||||
Type of securities | Name of the securities | Financial statement account | Counter-party | Relationship | Beginning balance | Addition | Disposal | Ending balance | |||||||||||||||||||||||||||
Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Cost | Gain (Loss) | Units (thousand)/ bonds/ | Amount | ||||||||||||||||||||||||||
Stock | MIE FUJITSU SEMICONDUCTOR LIMITED | Available-for-sale financial assets, noncurrent | Purchase of newly issued shares | - | - | $- | 10,000 | $1,331,000 | - | $- | $- | $- | 10,000 | $1,254,000 | |||||||||||||||||||||
Stock | WAVETEK MICROELECTRONICS CORPORATION | Investments accounted for under the equity method | Purchase of newly issued shares | Subsidiary | 80,683 | 456,760 | 45,547 | 455,470 | - | - | - | - | 126,230 | 681,665 | |||||||||||||||||||||
Note 1 : The amounts of beginning and ending balances of available for sale financial assets are recorded at the prevailing market prices. The amounts of beginning and ending balances of investments accounted for under the equity method include adjustment under the equity method. | |||||||||||||||||||||||||||||||||||
Note 2 : The ending balance includes share of income of associates and joint ventures of NT$(36,997) thousand, retained earnings adjustment under equity method of NT$(3,794) thousand, additional paid-in capital adjustment under equity method of NT$25,033 thousand,exchange differences on translation of foreign operations adjustment under equity method of NT$(41) thousand, and related party unrealized gain of NT$214,766 thousand. | |||||||||||||||||||||||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | |||||||||||||||||||||||||||||||||||
Type of securities | Name of the securities | Financial statement account | Counter-party | Relationship | Beginning balance | Addition | Disposal | Ending balance | |||||||||||||||||||||||||||
Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Cost | Gain (Loss) | Units (thousand)/ bonds/ | Amount | ||||||||||||||||||||||||||
Stock | TOPCELL SOLAR INTERNATIONAL CO., LTD. | Non-current assets held for sale | MOTECH INDUSTRIES, INC. | - | 71,363 | $367,118 | - | $- | 71,363 | $424,015 | $337,522 | $86,493 | - | $- | |||||||||||||||||||||
Stock | MOTECH INDUSTRIES, INC. | Available-for-sale financial assets, noncurrent | MOTECH INDUSTRIES, INC. | - | - | - | 11,894 | 424,015 | - | - | - | - | 11,894 | 435,314 | |||||||||||||||||||||
Note 1 : The amounts of beginning and ending balances of available for sale financial assets are recorded at the prevailing market prices. The beginning and ending balances of non-current assets held for sale were the lower of book value and the fair value less | |||||||||||||||||||||||||||||||||||
cost to sale. | |||||||||||||||||||||||||||||||||||
Note 2 : The disposal cost was the lower of book value and the fair value less cost to sale. | |||||||||||||||||||||||||||||||||||
Note 3 : On June 1, 2015, TOPCELL SOLAR INTERNATIONAL CO., LTD. was merged with MOTECH INDUSTRIES, INC. (MOTECH) and MOTECH was the surviving company. | |||||||||||||||||||||||||||||||||||
HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | |||||||||||||||||||||||||||||||||||
Type of securities | Name of the securities | Financial statement account | Counter-party | Relationship | Beginning balance | Addition | Disposal | Ending balance | |||||||||||||||||||||||||||
Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Cost | Gain (Loss) | Units (thousand)/ bonds/ | Amount | ||||||||||||||||||||||||||
Capital | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | Investments accounted for under the equity method | Purchase of newly issued shares | Subsidiary | - | $- | - | USD | 100,000 | - | $- | $- | $- | - | USD | 98,489 | |||||||||||||||||||
Note 1 : The amounts of beginning and ending balances of investments accounted for under the equity method include adjustment under the equity method. | |||||||||||||||||||||||||||||||||||
Note 2 : The ending balance includes share of lose of associates and joint ventures of USD (99) thousand, additional paid-in capital adjustment under equity method of USD 6 thousand and exchange differences on translation of foreign operations adjustment | |||||||||||||||||||||||||||||||||||
under equity method of USD (1,418) thousand. | |||||||||||||||||||||||||||||||||||
UMC NEW BUSINESS INVESTMENT CORP. | |||||||||||||||||||||||||||||||||||
Type of securities | Name of the securities | Financial statement account | Counter-party | Relationship | Beginning balance | Addition | Disposal | Ending balance | |||||||||||||||||||||||||||
Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Cost | Gain (Loss) | Units (thousand)/ bonds/ | Amount | ||||||||||||||||||||||||||
Stock | TOPCELL SOLAR INTERNATIONAL CO., LTD. | Non-current assets held for sale | MOTECH INDUSTRIES, INC. | - | 170,931 | $837,934 | - | $- | 170,931 | $1,015,614 | $767,046 | $248,568 | - | $- | |||||||||||||||||||||
Stock | MOTECH INDUSTRIES, INC. | Available-for-sale financial assets, noncurrent | MOTECH INDUSTRIES, INC./Open market | - | - | - | 28,498 | 1,016,060 | - | - | - | - | 28,498 | 1,043,043 | |||||||||||||||||||||
Note 1 : The amounts of beginning and ending balances of available for sale financial assets are recorded at the prevailing market prices. The beginning and ending balances of non-current assets held for sale were the lower of book value and the fair value less | |||||||||||||||||||||||||||||||||||
cost to sale. | |||||||||||||||||||||||||||||||||||
Note 2 : The disposal cost was the lower of book value and the fair value less cost to sale. | |||||||||||||||||||||||||||||||||||
Note 3 : On June 1, 2015, TOPCELL SOLAR INTERNATIONAL CO., LTD. was merged with MOTECH INDUSTRIES, INC. (MOTECH) and MOTECH was the surviving company. Besides, purchased 10 thousands of MOTECH's shares from open market. |
104
ATTACHMENT 6 (Acquisition of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock for the six-month period ended June 30, 2015) | ||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | ||||||||||||||||||||||||
Where counter-party is a related party, details of prior transactions | ||||||||||||||||||||||||
Name of properties | Transaction date | Transaction amount | Payment status | Counter-party | Relationship | Former holder of property | Relationship between former holder and acquirer of property | Date of transaction | Transaction amount | Price reference | Date of acquisition and status of utilization | Other commitments | ||||||||||||
Dormitory | 2015.03.09 | $432,190 | By the construction progress | YIH SHIN CONSTRUCTION CO., LTD. | Third party | N/A | N/A | N/A | N/A | Open Bidding | Employee Dormitory | None | ||||||||||||
UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | ||||||||||||||||||||||||
Where counter-party is a related party, details of prior transactions | ||||||||||||||||||||||||
Name of properties | Transaction date | Transaction amount | Payment status | Counter-party | Relationship | Former holder of property | Relationship between former holder and acquirer of property | Date of transaction | Transaction amount | Price reference | Date of acquisition and status of utilization | Other commitments | ||||||||||||
Fab | 2015.03.20 | RMB 193,000 | By the construction progress | FUJIAN TUNG KANG STEEL CO., LTD. | Third Party | N/A | N/A | N/A | N/A | Open Bidding | Manufacturing purpose | None | ||||||||||||
Fab | 2015.04.10 | RMB 846,545 | By the construction progress | CHINA CONSTRUCTION SECOND ENGINEERING BUREAU LTD. | Third Party | N/A | N/A | N/A | N/A | Open Bidding | Manufacturing purpose | None | ||||||||||||
Fab | 2015.05.18 | RMB 1,745,359 | By the construction progress | L&K ENGINEERING (SUZHOU) CO.,LTD. | Third Party | N/A | N/A | N/A | N/A | Open Bidding | Manufacturing purpose | None |
105
ATTACHMENT 7 (Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock for the six-month period ended June 30, 2015) | ||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||||||
Names of properties | Transaction date | Date of original acquisition | Book value | Transaction amount | Status of proceeds collection | Gain (Loss) from disposal | Counter-party | Relationship | Reason of disposal | Price reference | Other commitments | |||||||||||
None | �� |
106
ATTACHMENT 8 ( Related party transactions for purchases and sales amounts exceeding the lower of NT$100 million or 20 percent of capital stock for the six-month period ended June 30, 2015) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | |||||||||||||||||||||||||
Transactions | Details of non-arm's length transaction | Notes and accounts receivable (payable) | Note | ||||||||||||||||||||||
Counter-party | Relationship | Purchases (Sales) |
| Amount |
| Percentage of total purchases (sales) |
| Term | Unit price |
| Term | Balance | Percentage of total receivables (payable) | ||||||||||||
UMC GROUP (USA) | Subsidiary | Sales | $32,609,557 | 48 | % | Net 60 Days | N/A | N/A | $7,750,516 | 38 | % | ||||||||||||||
UMC GROUP JAPAN | Subsidiary | Sales | 4,060,991 | 6 | % | Net 60 Days | N/A | N/A | 1,521,402 | 7 | % | ||||||||||||||
FARADAY TECHNOLOGY CORPORATION | Associate | Sales | 185,305 | 0 | % | Net 45 Days | N/A | N/A | 201,114 | 1 | % | ||||||||||||||
UMC GROUP (USA) | |||||||||||||||||||||||||
Transactions | Details of non-arm's length transaction | Notes and accounts receivable (payable) | Note | ||||||||||||||||||||||
Counter-party | Relationship | Purchases (Sales) |
| Amount |
| Percentage of total purchases (sales) |
| Term | Unit price |
| Term | Balance | Percentage of total receivables (payable) | ||||||||||||
UNITED MICROELECTRONICS | Parent company | Purchases | USD | 1,047,476 | 99 | % | Net 60 Days | N/A | N/A | USD | 251,440 | 99 | % | ||||||||||||
HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | Associate | Purchases | USD | 10,146 | 1 | % | Net 60 Days | N/A | N/A | USD | 3,160 | 1 | % | ||||||||||||
UMC GROUP JAPAN | |||||||||||||||||||||||||
Transactions | Details of non-arm's length transaction | Notes and accounts receivable (payable) | Note | ||||||||||||||||||||||
Counter-party | Relationship | Purchases (Sales) |
| Amount |
| Percentage of total purchases (sales) |
| Term | Unit price |
| Term | Balance | Percentage of total receivables (payable) | ||||||||||||
UNITED MICROELECTRONICS | Parent company | Purchases | JPY | 15,302,083 | 98 | % | Net 60 Days | N/A | N/A | JPY | 6,050,221 | 98 | % | ||||||||||||
107
ATTACHMENT 8 ( Related party transactions for purchases and sales amounts exceeding the lower of NT$100 million or 20 percent of capital stock for the six-month period ended June 30, 2015) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | |||||||||||||||||||||||||
Transactions | Details of non-arm's length transaction | Notes and accounts receivable (payable) | Note | ||||||||||||||||||||||
Counter-party | Relationship | Purchases (Sales) |
| Amount |
| Percentage of total purchases (sales) |
| Term | Unit price |
| Term | Balance | Percentage of total receivables (payable) | ||||||||||||
UMC GROUP (USA) | Associate | Sales | USD | 10,146 | 7 | % | Net 60 Days | N/A | N/A | USD | 3,160 | 6 | % | ||||||||||||
WAVETEK MICROELECTRONICS CORPORATION | |||||||||||||||||||||||||
Transactions | Details of non-arm's length transaction | Notes and accounts receivable (payable) | Note | ||||||||||||||||||||||
Counter-party | Relationship | Purchases (Sales) |
| Amount |
| Percentage of total purchases (sales) |
| Term | Unit price |
| Term | Balance | Percentage of total receivables (payable) | ||||||||||||
UNITED MICROELECTRONICS | Parent company | Sales | $327,898 | 50 | % | Net 30 Days | N/A | N/A | $118,914 | 56 | % | ||||||||||||||
108
ATTACHMENT 9 (Receivables from related parties with amounts exceeding the lower of NT$100 million or 20 percent of capital stock as of June 30, 2015) | ||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | ||||||||||||||||||||
Ending balance | Turnover rate (times) | Overdue receivables | Amount received in subsequent period | Allowance for doubtful accounts | ||||||||||||||||
Counter-party | Relationship | Notes receivable |
| Accounts receivable |
| Other receivables |
| Total | Amount |
| Collection status | |||||||||
UMC GROUP (USA) | Subsidiary | $- | $7,750,516 | $28 | $7,750,544 | 8.73 | $- | - | $3,617,374 | $8,137 | ||||||||||
UMC GROUP JAPAN | Subsidiary | - | 1,521,402 | 7 | 1,521,409 | 5.96 | 94,185 | Collection in | 481,499 | - | ||||||||||
FARADAY TECHNOLOGY CORPORATION | Associate | - | 201,114 | 13 | 201,127 | 3.69 | - | - | - | - | ||||||||||
WAVETEK MICROELECTRONICS CORPORATION | ||||||||||||||||||||
Ending balance | Turnover rate (times) | Overdue receivables | Amount received in subsequent period | Allowance for doubtful accounts | ||||||||||||||||
Counter-party | Relationship | Notes receivable |
| Accounts receivable |
| Other receivables |
| Total | Amount |
| Collection status | |||||||||
UNITED MICROELECTRONICS | Parent company | $- | $118,914 | $- | $118,914 | 11.00 | $- | - | $- | $- |
109
ATTACHMENT 10 (Names, locations and related information of investee companies as of June 30, 2015) (Not including investment in Mainland China) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
UMC GROUP (USA) | USA | IC Sales | USD | 16,438 | USD | 16,438 | 16,438 | 100.00 | $1,626,056 | $63,927 | $63,927 | ||||||||||||||
UNITED MICROELECTRONICS (EUROPE) B.V. | The Netherlands | Marketing support activities | USD | 5,421 | USD | 5,421 | 9 | 100.00 | 133,512 | 1,192 | 1,192 | ||||||||||||||
UMC CAPITAL CORP. | Cayman Islands | Investment holding | USD | 81,500 | USD | 81,500 | 71,663 | 100.00 | 4,850,152 | 112,681 | 110,703 | ||||||||||||||
GREEN EARTH LIMITED | Samoa | Investment holding | USD | 10,000 | USD | 10,000 | 10,000 | 100.00 | 239,928 | (5,548) | (5,548) | ||||||||||||||
TLC CAPITAL CO., LTD. | Taipei City, Taiwan | New business investment | 6,000,000 | 6,000,000 | 486,150 | 100.00 | 7,296,777 | (20,903) | (20,903) | ||||||||||||||||
UMC NEW BUSINESS INVESTMENT CORP. | Taipei City, Taiwan | Investment holding | 6,000,000 | 6,000,000 | 600,000 | 100.00 | 2,387,585 | 114,798 | 114,798 | ||||||||||||||||
UMC INVESTMENT (SAMOA) LIMITED | Samoa | Investment holding | USD | 1,520 | USD | 1,520 | 1,520 | 100.00 | 45,212 | (656) | (656) | ||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | Taipei City, Taiwan | Consulting and planning for investment in new business | 5,000,053 | 5,000,053 | 458,800 | 100.00 | 6,152,192 | 139,559 | 139,559 | ||||||||||||||||
UMC GROUP JAPAN | Japan | IC Sales | JPY | 60,000 | JPY | 60,000 | 1 | 100.00 | 86,782 | 42,206 | 42,206 | ||||||||||||||
UMC KOREA CO., LTD. | Korea | Marketing support activities | KRW | 550,000 | KRW | 550,000 | 110 | 100.00 | 17,004 | 394 | 394 | ||||||||||||||
OMNI GLOBAL LIMITED | Samoa | Investment holding | USD | 3,000 | USD | 3,000 | 3,000 | 100.00 | 43,359 | (539) | (539) | ||||||||||||||
BEST ELITE INTERNATIONAL LIMITED | British Virgin Islands | Investment holding | USD | 235,089 | USD | 235,089 | 597,682 | 86.88 | 18,759,063 | 1,009,664 | 877,236 | ||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION | Hsinchu City, Taiwan | GaAs Foundry service | 1,252,012 | 1,252,012 | 126,230 | 77.74 | 681,665 | (47,730) | (36,997) | ||||||||||||||||
MTIC HOLDINGS PTE. LTD. | Singapore | Investment holding | SGD | 12,000 | SGD | 12,000 | 12,000 | 45.44 | 92,444 | (5,358) | (8,262) | ||||||||||||||
MEGA MISSION LIMITED PARTNERSHIP | Cayman Islands | Investment holding | USD | 67,500 | USD | 67,500 | - | 45.00 | 1,974,086 | 151,966 | 68,385 | ||||||||||||||
NEXPOWER TECHNOLOGY CORP. | Taichung City, Taiwan | Sales and manufacturing of solar power batteries | 5,331,885 | 5,331,885 | 215,283 | 44.16 | 712,099 | (528,488) | (233,370) | ||||||||||||||||
UNITECH CAPITAL INC. | British Virgin Islands | Investment holding | USD | 21,000 | USD | 21,000 | 21,000 | 42.00 | 686,393 | (7,608) | (3,195) | ||||||||||||||
HSUN CHIEH INVESTMENT CO., LTD. | Taipei City, Taiwan | Investment holding | 336,241 | 336,241 | 134,815 | 36.49 | 3,339,329 | (48,209) | (17,590) | ||||||||||||||||
FARADAY TECHNOLOGY CORP. | Hsinchu City, Taiwan | Design of application-specific integrated circuit | 64,864 | - | 57,067 | 13.80 | 2,179,694 | 265,506 | (2,376) |
110
ATTACHMENT 10 (Names, locations and related information of investee companies as of June 30, 2015) (Not including investment in Mainland China) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
UNITRUTH INVESTMENT CORP. | Taipei City, Taiwan | Investment holding | $800,000 | $800,000 | 132,660 | 100.00 | $1,012,241 | $93,549 | $93,549 | ||||||||||||||||
MOS ART PACK CORP. | Hsinchu City, Taiwan | IC Packaging | 290,000 | 290,000 | 29,000 | 54.45 | 177,849 | - | - | Note 1 | |||||||||||||||
NEXPOWER TECHNOLOGY CORP. | Taichung City, Taiwan | Sales and manufacturing of solar power batteries | 718,930 | 718,930 | 29,194 | 5.99 | 96,565 | (528,488) | (31,646) | ||||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION | Hsinchu City, Taiwan | GaAs Foundry service | 5,454 | - | 735 | 0.45 | 5,220 | (47,730) | (233) | ||||||||||||||||
TOPCELL SOLAR INTERNATIONAL CO., LTD. | Taoyuan City, Taiwan | Sales and manufacturing of solar power cell | - | 1,032,692 | - | - | - | (113,647) | (29,596) | Note 2 | |||||||||||||||
Note 1: On March 10, 2011, MOS ART PACK CORP. (MAP) reached the decesion of liquidation at it's stockholders' meeting. The Company had ceased to recognize investment income of MAP | |||||||||||||||||||||||||
thereafter. | |||||||||||||||||||||||||
Note 2: On June 1, 2015, TOPCELL SOLAR INTERNATIONAL CO., LTD. was merged with MOTECH INDUSTRIES, INC.(MOTECH) and MOTECH is the surviving company. | |||||||||||||||||||||||||
TLC CAPITAL CO., LTD. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
SOARING CAPITAL CORP. | Samoa | Investment holding | USD | 900 | USD | 900 | 900 | 100.00 | $18,421 | $1,566 | $1,566 | ||||||||||||||
LIST EARN ENTERPRISE INC. | Samoa | Investment holding | USD | 309 | USD | 309 | 309 | 49.00 | 10,442 | 87 | 42 | ||||||||||||||
YUNG LI INVESTMENTS, INC. | Taipei City, Taiwan | Investment holding | 240,800 | 280,000 | 24,080 | 45.16 | 318,477 | 120,371 | 54,361 | ||||||||||||||||
CTC CAPITAL PARTNERS I, L.P. | Cayman Islands | Investment holding | USD | 3,079 | USD | 3,872 | - | 31.40 | 167,432 | (83,899) | (26,341) | ||||||||||||||
VSENSE CO., LTD. | Taipei City, Taiwan | Medical devices, measuring equipment, reagents and consumables | 95,916 | - | 4,251 | 28.63 | 105,497 | (15,288) | (785) | ||||||||||||||||
NEXPOWER TECHNOLOGY CORP. | Taichung City, Taiwan | Sales and manufacturing of solar power batteries | 778,019 | 778,019 | 28,601 | 5.87 | 94,603 | (528,488) | (31,003) | ||||||||||||||||
TOPCELL SOLAR INTERNATIONAL CO., LTD. | Taoyuan City, Taiwan | Sales and manufacturing of solar power cell | - | 384,140 | - | - | - | (113,647) | (2,699) | Note | |||||||||||||||
Note: On June 1, 2015, TOPCELL SOLAR INTERNATIONAL CO., LTD. was merged with MOTECH INDUSTRIES, INC. (MOTECH) and MOTECH is the surviving company. | |||||||||||||||||||||||||
UNITRUTH INVESTMENT CORP. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
MOS ART PACK CORP. | Hsinchu City, Taiwan | IC Packaging | $98,690 | $98,690 | 9,869 | 18.53 | $60,524 |
| $- | $- | Note 1 | ||||||||||||||
NEXPOWER TECHNOLOGY CORP. | Taichung City, Taiwan | Sales and manufacturing of solar power batteries | 309,700 | 309,700 | 10,990 | 2.25 | 36,352 | (528,488) | (11,913) | ||||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION | Hsinchu City, Taiwan | GaAs Foundry service | 3,402 | - | 459 | 0.28 | 3,256 | (47,730) | (146) | ||||||||||||||||
TOPCELL SOLAR INTERNATIONAL CO., LTD. | Taoyuan City, Taiwan | Sales and manufacturing of solar power cell | - | 165,272 | - | - | - | (113,647) | (1,168) | Note 2 | |||||||||||||||
Note 1: On March 10, 2011, MOS ART PACK CORP. (MAP) reached the decesion of liquidation at it's stockholders' meeting. The Company had ceased to recognize investment income of MAP | |||||||||||||||||||||||||
thereafter. | |||||||||||||||||||||||||
Note 2: On June 1, 2015, TOPCELL SOLAR INTERNATIONAL CO., LTD. was merged with MOTECH INDUSTRIES, INC. (MOTECH) and MOTECH is the surviving company. |
111
ATTACHMENT 10 (Names, locations and related information of investee companies as of June 30, 2015) (Not including investment in Mainland China) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
UMC CAPITAL CORP. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
UMC CAPITAL (USA) | USA | Investment holding | USD | 200 | USD | 200 | 200 | 100.00 | USD | 493 | USD | (14) | USD | (14) | |||||||||||
ECP VITA PTE. LTD. | Singapore | Insurance | USD | 9,000 | USD | 9,000 | 9,000 | 100.00 | USD | 15,867 | USD | 1,880 | USD | 1,880 | |||||||||||
TRANSLINK CAPITAL PARTNERS III, L.P. | Cayman Islands | Investment holding | USD | 6,000 | USD | 6,000 | - | 27.29 | USD | 6,313 | USD | 440 | USD | 17 | |||||||||||
ACHIEVE MADE INTERNATIONAL LTD. | British Virgin | Internet Content Provider | USD | 11,035 | USD | 11,035 | 2,724 | 23.32 | USD | 5,130 | USD | (821) | USD | (156) | |||||||||||
TRANSLINK CAPITAL PARTNERS I, L.P. | Cayman Islands | Investment holding | USD | 2,498 | USD | 3,382 | - | 10.38 | USD | 3,220 | USD | 2,021 | USD | 168 | |||||||||||
UMC NEW BUSINESS INVESTMENT CORP. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
TERA ENERGY DEVELOPMENT CO., LTD. | Hsinchu City, Taiwan | Energy Technical Services | $230,754 | $230,754 | 31,655 | 100.00 | $278,902 | $(6,547) | $(7,457) | ||||||||||||||||
UNISTARS CORPORATION | Hsinchu County, Taiwan | High brightness LED packages | 477,240 | 477,240 | 33,194 | 78.72 | 116,304 | (44,105) | (34,719) | ||||||||||||||||
UNITED LIGHTING OPTO-ELECTRONIC INC. | Hsinchu City, Taiwan | LED lighting manufacturing and sale | 266,772 | 266,772 | 8,949 | 55.25 | 9,586 | - | - | Note 1 | |||||||||||||||
WINAICO IMMOBILIEN GMBH | Germany | Solar project | EUR | 5,900 | EUR | 5,900 | 5,900 | 32.78 | 163,117 | (8,135) | (3,575) | ||||||||||||||
UNITED LED CORPORATION HONG KONG LIMITED | Hongkong | Investment holding | USD | 22,500 | USD | 22,500 | 22,500 | 25.14 | 519,366 | (47,903) | (13,099) | ||||||||||||||
TOPCELL SOLAR INTERNATIONAL CO., LTD. | Taoyuan City, Taiwan | Sales and manufacturing of solar power cell | - | 3,404,527 | - | - | - | (113,647) | (70,888) | Note 2 | |||||||||||||||
Note 1: On June 19, 2012, UNITED LIGHTING OPTO-ELECTRONIC INC. has filed for liquidation through a decision at its stockholders’ meeting. | |||||||||||||||||||||||||
The Company had ceased to recognize investment income of UNITED LIGHTING OPTO-ElECTRONIC INC. thereafter. | |||||||||||||||||||||||||
Note 2: On June 1, 2015, TOPCELL SOLAR INTERNATIONAL CO., LTD. was merged with MOTECH INDUSTRIES, INC.(MOTECH) and MOTECH is the surviving company. | |||||||||||||||||||||||||
TERA ENERGY DEVELOPMENT CO., LTD. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
EVERRICH ENERGY INVESTMENT (HK) LIMITED | Hongkong | Investment holding | USD | 1,092 | USD | 1,725 | 1,092 | 100.00 | $118,348 | $(244) | $(244) | ||||||||||||||
WINAICO SOLAR PROJEKT 1 GMBH | Germany | Solar project | EUR | 1,120 | EUR | 1,120 | 1,120 | 50.00 | 31,383 | (618) | (309) | ||||||||||||||
WINAICO IMMOBILIEN GMBH | Germany | Solar project | EUR | 2,160 | EUR | 2,160 | 2,160 | 12.00 | 61,326 | (8,135) | 577 | ||||||||||||||
TERA ENERGY USA INC. | USA | Solar project | - | 535 | - | - | - | (7) | (7) | ||||||||||||||||
SMART ENERGY ENTERPRISES LIMITED | Hongkong | Investment holding | - | USD | 0 | - | - | - | (1) | (1) |
112
ATTACHMENT 10 (Names, locations and related information of investee companies as of June 30, 2015) (Not including investment in Mainland China) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
WAVETEK MICROELECTRONICS INVESTMENT (SAMOA) LIMITED | Samoa | Investment holding | USD | 600 | USD | 600 | 600 | 100.00 | $6,476 | $(3,300) | $(3,300) | ||||||||||||||
WAVETEK MICROELECTRONICS INVESTMENT (SAMOA) LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION (USA) | USA | Sales and marketing service | USD | 60 | USD | 60 | 60 | 100.00 | $2,099 | $66 | $66 | ||||||||||||||
NEXPOWER TECHNOLOGY CORPORATION | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
SOCIALNEX ITALIA 1 S.R.L. | Italy | Photovoltaic power plant | EUR | 3,637 | EUR | 3,637 | - | 100.00 | $119,458 | $1,866 | $1,866 | ||||||||||||||
NPT HOLDING LIMITED | Samoa | Investment holding | USD | 0 | USD | 0 | 0 | 100.00 | 0 | - | - | ||||||||||||||
NPT HOLDING LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
NLL HOLDING LIMITED | Samoa | Investment holding | USD | 0 | USD | 0 | 0 | 100.00 | $0 | $- | $- | ||||||||||||||
�� | |||||||||||||||||||||||||
BEST ELITE INTERNATIONAL LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
INFOSHINE TECHNOLOGY LIMITED | British Virgin Islands | Investment holding | USD | 354,000 | USD | 354,000 | - | 100.00 | USD | 344,718 | USD | 32,594 | USD | 32,594 | |||||||||||
INFOSHINE TECHNOLOGY LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
OAKWOOD ASSOCIATES LIMITED | British Virgin Islands | Investment holding | USD | 354,000 | USD | 354,000 | - | 100.00 | USD | 344,718 | USD | 32,594 | USD | 32,594 | |||||||||||
113
ATTACHMENT 10 (Names, locations and related information of investee companies as of June 30, 2015) (Not including investment in Mainland China) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
OMNI GLOBAL LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
UNITED MICROTECHNOLOGY CORPORATION (NEW YORK) | USA | Research & Development | USD | 950 | USD | 950 | 0 | 100.00 | $31,225 | $3 | $3 | ||||||||||||||
UNITED MICROTECHNOLOGY CORPORATION (CALIFORNIA) | USA | Research & Development | USD | 13.50 | - | - | 100.00 | 395 | (21) | (21) | |||||||||||||||
GREEN EARTH LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of June 30, 2015 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Book value | ||||||||||||||||||
UNITED MICROCHIP CORPORATION | Cayman | Investment holding | USD | 50 | - | - | 100.00 | $1,242 | $(309) | $(309) | |||||||||||||||
114
ATTACHMENT 11 (Investment in Mainland China as of June 30, 2015) | |||||||||||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||||||||||
Investee company | Main businesses and products | Total amount of | Method of investment | Accumulated | Investment flows | Accumulated outflow of investment from Taiwan as of | Percentage of ownership | Investment income (loss) recognized | Carrying value as of | Accumulated inward remittance of earnings as of | |||||||||||||||||||||||
Outflow |
|
| Inflow | Net income (loss) of investee company | |||||||||||||||||||||||||||||
UNITRUTH ADVISOR (SHANGHAI) CO., LTD. | Investment Holding and advisory |
(USD | $24,640 | (ii)SOARING COPITAL CORP. |
(USD | $24,640 | $- | $- |
(USD | $24,640 | $1,637 | 100.00% | $1,637 | $15,572 | $- | ||||||||||||||||||
SHANDONG HUAHONG ENERGY INVEST CO., INC. | Invest new energy business |
(RMB | 1,485,600 | (i) |
(USD | 41,888 | - | - |
(USD | 41,888 | (32,762) | 50.00% | (16,381) | 697,802 | - | ||||||||||||||||||
JINING SUNRICH SOLAR ENERGY CORP. | To construct, operate, and maintain solar power plant |
(RMB | 1,386,560 | (iii)SHANDONG HUAHONG ENERGY INVEST CO., INC. |
(USD | 644,644 | - | - |
(USD | 644,644 | (33,196) | 50.00% | (16,598) | 655,157 | - | ||||||||||||||||||
EVERRICH (SHANDONG) ENERGY CO., LTD. | Solar engineering integrated design services |
(USD | 95,480 | (ii)EVERRICH ENERGY INVESTMENT (HK) LIMITED |
(USD | 95,480 | - | - |
(USD | 95,480 | (112) | 100.00% | (112) | 111,402 |
(USD | 101,825 | |||||||||||||||||
UNITED LED CORPORATION | Research, manufacturing and sales in LED epitaxial wafers |
(USD | 2,587,200 | (ii)UNITED LED CORPORATION HONG KONG LIMITED |
(USD | 623,700 | - | - |
(USD | 623,700 |
(RMB | (53,293) | 25.14% |
(RMB | (14,777) |
(RMB | 497,775 | - | |||||||||||||||
HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | Sales and manufacturing of integrated circuits |
(USD | 11,704,000 | (ii)OAKWOOD ASSOCIATES LIMITED |
(USD | 7,240,741 | - | - |
(USD | 7,240,741 |
(USD | 1,001,000 | 86.88% |
(USD | 869,730 |
(USD | 18,007,343 | - | |||||||||||||||
UMC (BEIJING) LIMITED | Marketing support activities |
(USD | 15,400 | (ii)UMC INVESTMENT |
(USD | 15,400 | - | - |
(USD | 15,400 | 69 | 100.00% | 69 | 16,090 | - | ||||||||||||||||||
UNITEDDS SEMICONDUCTOR (SHANDONG) CO., LTD. | Design support of integrated circuits |
(RMB | 148,560 | (iii)HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | - | - | - | - |
(RMB | (6,017) | 86.88% |
(RMB | (5,229) |
(RMB | 111,014 | - | |||||||||||||||||
UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | Sales and manufacturing of integrated circuits |
(RMB | 9,112,779 | (iii)HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | - | - | - | - |
(RMB | (8,849) | 28.96% |
(RMB | (2,565) |
(RMB | 2,636,673 | - | |||||||||||||||||
Accumulated investment in Mainland China as of | Investment amounts authorized by Investment Commission, MOEA | Upper limit on investment | ||||||||||||||||||||||||||||||||
$8,686,493 | $30,728,513 | $132,404,836 | ||||||||||||||||||||||||||||||||
Note 1 : | The methods for engaging in investment in Mainland China include the following: | |||||||||||||||||||||||||||||||||
(i) Direct investment in Mainland China. | ||||||||||||||||||||||||||||||||||
(ii) Indirectly investment in Mainland China through companies registered in a third region. (Please specify the name of the company in third region). | ||||||||||||||||||||||||||||||||||
(iii) Other methods | ||||||||||||||||||||||||||||||||||
Note 2 : | The investment income (loss) recognized in current period: | |||||||||||||||||||||||||||||||||
1. Please specify no investment income (loss) has been recognized due to the investment is still during development stage. | ||||||||||||||||||||||||||||||||||
2. The investment income (loss) were determined based on the following basis: | ||||||||||||||||||||||||||||||||||
(i) The financial report was audited and certified by an international accounting firm in cooperation with an R.O.C. accounting firm. | ||||||||||||||||||||||||||||||||||
(ii) The financial statements certificated by the CPA of the parent company in Taiwan. | ||||||||||||||||||||||||||||||||||
(iii) Others. | ||||||||||||||||||||||||||||||||||
Note 3 : | Initial investment amounts denominated in foreign currencies are translated into New Taiwan Dollars using the spot rates at the financial report date. | |||||||||||||||||||||||||||||||||
Note 4 : | The Company indirectly invested in HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. via investment in BEST ELITE INTERNATIONAL LIMITED (BEST ELITE), an equity investee. The Investment Commission, MOEA has approved to invest US$217,572 thousand in BEST ELITE's preferred stock, invest US$91,984 thousand in BEST ELITE's common stock. As of June 30, 2015, the amount of investment has been remitted. | |||||||||||||||||||||||||||||||||
Note 5 : | UMC (BEIJING) LIMITED have been made in the Investment Commission, MOEA and approved US$3,000 thousand. As of June 30, 2015, the amount of investment US$2,500 thousand has not yet been remitted. | |||||||||||||||||||||||||||||||||
Note 6 : | The consent to invest in UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. (USCXM) have been made by the Investment Commission, MOEA which approved the total investment amount US$710,640 thousand. As of June 30, 2015, the investment amount to USCXM from HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. was US$86,880 thousand, and the rest investment amount US$623,760 thousand has not yet been remitted. | |||||||||||||||||||||||||||||||||
|
115