UNITED MICROELECTRONICS CORPORATION
AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
WITH REPORT OF INDEPENDENT ACCOUNTANTS
FOR THE NINE-MONTH PERIODS ENDED
SEPTEMBER 30, 2018 AND 2017
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
To United Microelectronics Corporation
Introduction
We have reviewed the accompanying consolidated balance sheets ofUnited Microelectronics Corporation and subsidiaries (collectively, the “Company”)as of September 30, 2018 and 2017, the related consolidated statements of comprehensive income for the three-month and nine-month periods ended September 30, 2018 and 2017 and consolidated statements of changes in equity and cash flows for the nine-month periods ended September 30, 2018 and 2017,and notes to the consolidated financial statements, including the summary of significant accounting policies (together “the consolidated financial statements”). Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with theRegulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” as endorsed and became effective by Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on theseconsolidated financial statements based on our reviews.
Scope of Review
We conducted our reviews in accordance with Statement of Auditing Standards No. 65, “Review of Financial Information Performed by the Independent Auditor of the Entity” of the Republic of China. A review ofconsolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance withauditing standards generally accepted in the Republic of China and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our reviewsand the review reports of other independent accountants (please refer to theOther Matterparagraphof our report), nothing has come to our attention that causes us to believe that the accompanyingconsolidated financial statements do not present fairly, in all material respects, the consolidated financial position of theCompany and its subsidiaries as of September 30, 2018 and 2017,theirconsolidated financial performance for the three-month and nine-month periods ended September 30, 2018 and 2017, and cash flows for the nine-month periods ended September 30, 2018 and 2017, in accordance with theRegulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” as endorsed and became effective by Financial Supervisory Commission of the Republic of China.
2
Emphasis of Matter – Applying for New Accounting Standards
We draw attention to Note 3 of the consolidated financial statements, which describestheCompany and its subsidiaries applied for the International Financial Reporting Standard 9, “Financial Instruments” and 15, “Revenue from Contracts with Customers” starting from January 1, 2018, and elected not to restate the consolidated financial statements for prior periods. Our conclusion is not modified in respect of this matter.
Other Matter – Making Reference to the Reviews of Other Independent Accountants
Our review, insofar as it related to the investments accounted for under the equity method balances of NT$9,875 million and NT$8,480 million, which represented 2.65% and 2.21% of the total consolidated assets as ofSeptember 30, 2018 and 2017, respectively, the related shares of investment income from the associates and joint ventures in the amount of NT$17 million, NT$197 million, NT$364 million and NT$156 million, which represented 2.09%, 6.89%, 7.63% and 2.58% of the consolidated income from continuing operations before income tax for the three-month and nine-month periods endedSeptember 30, 2018 and 2017, respectively, and the related shares of other comprehensive income from the associates and joint ventures in the amount of NT$(54) million, NT$171 million, NT$84 million and NT$1,311 million, which represented 3.92%, 12.26%, 1.30% and 47.32% of the consolidated total comprehensive income for the three-month and nine-month periods endedSeptember 30, 2018 and 2017, respectively, are based solely on the reports of other independent accountants.
/s/ Chiu, Wan-Ju
/s/ Hsu, Hsin-Min
Ernst & Young, Taiwan
October 24, 2018
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.
3
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
September 30, 2018, December 31,2017 and September 30, 2017 (September 30, 2018 and 2017 are unaudited) | ||||||||
(Expressed in Thousands of New Taiwan Dollars) | ||||||||
As of | ||||||||
Assets | Notes | September 30, 2018 | December 31, 2017 | September 30, 2017 | ||||
Current assets | ||||||||
Cash and cash equivalents | 6(1) | $ 81,520,158 | $ 81,674,572 | $ 69,938,407 | ||||
Financial assets at fair value through profit or loss, current | 6(2), 12(7) | 422,326 | 716,918 | 844,078 | ||||
Contract asset, current | 6(21) | 338,096 | - | - | ||||
Notes receivable | 6,533 | 6,283 | 17,897 | |||||
Accounts receivable, net | 6(3) | 25,268,851 | 20,876,417 | 22,391,461 | ||||
Accounts receivable-related parties, net | 7 | 334,598 | 91,065 | 200,273 | ||||
Other receivables | 1,273,498 | 1,175,307 | 1,022,240 | |||||
Current tax assets | 31,463 | 507,871 | 606,441 | |||||
Inventories, net | 6(4) | 17,588,556 | 18,257,500 | 17,102,326 | ||||
Prepayments | 11,626,693 | 13,209,550 | 11,106,044 | |||||
Other current assets | 1,742,809 | 2,645,003 | 1,480,280 | |||||
Total current assets | 140,153,581 | 139,160,486 | 124,709,447 | |||||
Non-current assets | ||||||||
Financial assets at fair value through profit or loss, noncurrent | 6(2), 12(7) | 12,508,679 | 191,005 | 173,400 | ||||
Financial assets at fair value through other comprehensive income, noncurrent | 6(5), 12(7) | 11,722,990 | - | - | ||||
Available-for-sale financial assets, noncurrent | 6(6), 12(7) | - | 20,636,332 | 21,055,861 | ||||
Financial assets measured at cost, noncurrent | 6(7) | - | 2,218,472 | 2,530,440 | ||||
Investments accounted for under the equity method | 6(8), 7 | 12,028,943 | 10,976,940 | 10,967,948 | ||||
Property, plant and equipment | 6(9), 8 | 177,716,434 | 205,741,681 | 207,366,990 | ||||
Intangible assets | 6(10), 7 | 3,206,651 | 3,787,509 | 3,872,587 | ||||
Deferred tax assets | 6(26) | 6,621,333 | 6,071,582 | 6,159,208 | ||||
Prepayment for equipment | 1,282,147 | 286,090 | 1,336,900 | |||||
Refundable deposits | 8 | 2,775,848 | 1,903,041 | 2,090,029 | ||||
Other noncurrent assets-others | 8 | 4,652,623 | 3,126,024 | 3,910,223 | ||||
Total non-current assets | 232,515,648 | 254,938,676 | 259,463,586 | |||||
Total assets | $ 372,669,229 | $ 394,099,162 | $ 384,173,033 | |||||
(continued) |
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
September 30, 2018, December 31,2017 and September 30, 2017 (September 30, 2018 and 2017 are unaudited) | ||||||||
(Expressed in Thousands of New Taiwan Dollars) | ||||||||
As of | ||||||||
Liabilities and Equity | Notes | September 30, 2018 | December 31, 2017 | September 30, 2017 | ||||
Current liabilities | ||||||||
Short-term loans | 6(11), 6(28) | $ 14,817,804 | $ 25,445,540 | $ 22,669,606 | ||||
Financial liabilities at fair value through profit or loss, current | 6(12), 12(7) | - | - | 22,361 | ||||
Hedging financial liabilities, current | 4, 6(13), 12(7) | 64,315 | - | - | ||||
Contract liabilities, current | 6(21) | 1,978,822 | - | - | ||||
Notes and accounts payable | 6,885,729 | 6,535,570 | 6,607,930 | |||||
Other payables | 7 | 12,145,915 | 12,962,286 | 11,652,851 | ||||
Payables on equipment | 2,585,508 | 4,671,802 | 5,228,337 | |||||
Current tax liabilities | 2,096,528 | 4,097,568 | 3,956,473 | |||||
Current portion of long-term liabilities | 6(14), 6(15), 6(28), 8, 12(7) | 5,509,780 | 27,363,822 | 26,074,195 | ||||
Other current liabilities | 6(17), 6(18), 7 | 5,349,106 | 6,984,482 | 6,144,829 | ||||
Total current liabilities | 51,433,507 | 88,061,070 | 82,356,582 | |||||
Non-current liabilities | ||||||||
Bonds payable | 6(14), 6(28), 12(7) | 38,788,603 | 23,675,861 | 18,280,865 | ||||
Long-term loans | 6(15), 6(28), 8, 12(7) | 28,670,385 | 29,643,284 | 34,075,042 | ||||
Deferred tax liabilities | 6(26) | 1,941,263 | 1,631,705 | 1,741,119 | ||||
Net defined benefit liabilities, noncurrent | 4,118,683 | 4,138,519 | 3,958,437 | |||||
Guarantee deposits | 6(28) | 484,491 | 469,491 | 467,561 | ||||
Other noncurrent liabilities-others | 6(17), 6(28), 9(6) | 34,674,331 | 32,441,648 | 28,856,240 | ||||
Total non-current liabilities | 108,677,756 | 92,000,508 | 87,379,264 | |||||
Total liabilities | 160,111,263 | 180,061,578 | 169,735,846 | |||||
Equity attributable to the parent company | ||||||||
Capital | 6(19) | |||||||
Common stock | 124,243,187 | 126,243,187 | 126,243,187 | |||||
Additional paid-in capital | 4, 6(14), 6(19) | |||||||
Premiums | 36,278,383 | 36,862,383 | 36,862,383 | |||||
Treasury stock transactions | 1,737,113 | 1,753,028 | 1,753,028 | |||||
The differences between the fair value of the consideration paid or received from | 573,336 | 573,336 | 578,538 | |||||
acquiring or disposing subsidiaries and the carrying amounts of the subsidiaries | ||||||||
| ||||||||
Share of changes in net assets of associates and joint ventures accounted for using equity | 99,204 | 97,482 | 90,304 | |||||
method | ||||||||
Employee stock options | 58,087 | - | - | |||||
Stock options | 1,515,297 | 1,572,121 | 1,572,121 | |||||
Other | 8,553 | - | - | |||||
Retained earnings | 6(19) | |||||||
Legal reserve | 10,865,280 | 9,902,407 | 9,902,407 | |||||
Unappropriated earnings | 53,865,375 | 38,163,492 | 37,273,125 | |||||
Other components of equity | ||||||||
Exchange differences on translation of foreign operations | (6,251,427) | (5,715,585) | (4,630,460) | |||||
Unrealized gains or losses on financial assets measured at fair value through other | (8,360,617) | - | - | |||||
comprehensive income | ||||||||
Unrealized gains or losses on available-for-sale financial assets | - | 8,347,962 | 8,465,998 | |||||
Gains or losses on hedging instruments | (51,452) | - | - | |||||
Treasury stock | 6(19), 6(20) | (2,515,594) | (4,719,037) | (4,719,037) | ||||
Total equity attributable to the parent company | 212,064,725 | 213,080,776 | 213,391,594 | |||||
Non-controlling interests | 6(19) | 493,241 | 956,808 | 1,045,593 | ||||
Total equity | 212,557,966 | 214,037,584 | 214,437,187 | |||||
Total liabilities and equity | $ 372,669,229 | $ 394,099,162 | $ 384,173,033 | |||||
The accompanying notes are an integral part of the consolidated financial statements. |
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 nine-month periods ended September 30, 2018 and 2017 | |||||||||
(Expressed in Thousands of New Taiwan Dollars, Except for Earnings per Share) | |||||||||
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| For the three-month periods ended September 30, |
| For the nine-month periods ended September 30, | ||||
| Notes |
| 2018 |
| 2017 |
| 2018 |
| 2017 |
Operating revenues | 6(21), 7, 14 |
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Sales revenues |
|
| $ 37,778,845 |
| $ 36,772,830 |
| $ 109,666,034 |
| $ 109,763,527 |
Less: Sales returns and discounts |
|
| (363,723) |
| (366,603) |
| (881,377) |
| (1,300,433) |
Net sales |
|
| 37,415,122 |
| 36,406,227 |
| 108,784,657 |
| 108,463,094 |
Other operating revenues |
|
| 1,971,534 |
| 1,291,974 |
| 6,950,713 |
| 4,190,938 |
Net operating revenues |
|
| 39,386,656 |
| 37,698,201 |
| 115,735,370 |
| 112,654,032 |
Operating costs | 4, 6(4), 6(16), 6(20), |
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Costs of goods sold |
|
| (31,386,204) |
| (30,215,361) |
| (94,099,641) |
| (89,031,107) |
Other operating costs |
|
| (1,078,825) |
| (890,582) |
| (3,396,928) |
| (2,862,827) |
Operating costs |
|
| (32,465,029) |
| (31,105,943) |
| (97,496,569) |
| (91,893,934) |
Gross profit |
|
| 6,921,627 |
| 6,592,258 |
| 18,238,801 |
| 20,760,098 |
Operating expenses | 4, 6(16), 6(20), 6(22), |
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Sales and marketing expenses |
|
| (987,158) |
| (1,070,084) |
| (2,999,223) |
| (3,290,012) |
General and administrative expenses |
|
| (1,385,189) |
| (990,294) |
| (3,484,232) |
| (3,075,537) |
Research and development expenses |
|
| (3,328,898) |
| (3,343,194) |
| (9,280,121) |
| (10,580,051) |
Subtotal |
|
| (5,701,245) |
| (5,403,572) |
| (15,763,576) |
| (16,945,600) |
Net other operating income and expenses | 6(17), 6(23), 14 |
| 1,215,052 |
| 440,400 |
| 3,910,732 |
| 852,976 |
Operating income |
|
| 2,435,434 |
| 1,629,086 |
| 6,385,957 |
| 4,667,474 |
Non-operating income and expenses |
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Other income |
|
| 667,980 |
| 517,224 |
| 1,135,366 |
| 748,465 |
Other gains and losses | 6(24), 7 |
| (770,641) |
| 399,630 |
| (425,354) |
| 1,178,627 |
Finance costs | 6(24) |
| (736,016) |
| (661,009) |
| (2,144,110) |
| (1,812,595) |
Share of profit or loss of associates and joint ventures | 6(8), 14 |
| 193,182 |
| 204,834 |
| 480,333 |
| 196,334 |
Bargain purchase gain |
|
| - |
| - |
| - |
| 5,130 |
Exchange gain, net | 12 |
| - |
| 775,701 |
| - |
| 1,065,828 |
Exchange loss, net | 12 |
| (961,416) |
| - |
| (661,022) |
| - |
Subtotal |
|
| (1,606,911) |
| 1,236,380 |
| (1,614,787) |
| 1,381,789 |
Income from continuing operations before income tax |
|
| 828,523 |
| 2,865,466 |
| 4,771,170 |
| 6,049,263 |
Income tax benefit (expense) | 6(26), 14 |
| (631,665) |
| (401,548) |
| 872,022 |
| (610,689) |
Net income |
|
| 196,858 |
| 2,463,918 |
| 5,643,192 |
| 5,438,574 |
Other comprehensive income (loss) | 4, 6(25) |
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Items that will not be reclassified subsequently to profit or loss |
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Unrealized gains or losses on financial assets at fair value through other |
|
| 356,337 |
| - |
| 1,591,531 |
| - |
Gains or losses on hedging instruments which will not be reclassified |
|
| (64,315) |
| - |
| (64,315) |
| - |
Share of other comprehensive income (loss) of associates and joint ventures |
|
| (254,124) |
| - |
| (123,975) |
| - |
Income tax related to items that will not be reclassified subsequently | 6(26) |
| 50,550 |
| - |
| 90,436 |
| - |
Items that may be reclassified subsequently to profit or loss |
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Exchange differences on translation of foreign operations |
|
| (1,646,056) |
| 49,496 |
| (643,428) |
| (4,883,304) |
Unrealized gain (loss) on available-for-sale financial assets |
|
| - |
| (1,245,136) |
| - |
| 824,833 |
Share of other comprehensive income of associates and joint ventures which |
|
| (9,232) |
| 138,369 |
| 4,365 |
| 1,368,902 |
Income tax related to items that may be reclassified subsequently | 6(26) |
| (593) |
| (10,655) |
| (14,418) |
| 20,853 |
Total other comprehensive income (loss), net of tax |
|
| (1,567,433) |
| (1,067,926) |
| 840,196 |
| (2,668,716) |
Total comprehensive income (loss) |
|
| $ (1,370,575) |
| $ 1,395,992 |
| $ 6,483,388 |
| $ 2,769,858 |
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Net income attributable to: |
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Stockholders of the parent |
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| $ 1,720,426 |
| $ 3,472,656 |
| $ 8,779,603 |
| $ 7,857,683 |
Non-controlling interests |
|
| (1,523,568) |
| (1,008,738) |
| (3,136,411) |
| (2,419,109) |
|
|
| $ 196,858 |
| $ 2,463,918 |
| $ 5,643,192 |
| $ 5,438,574 |
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Comprehensive income attributable to: |
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Stockholders of the parent |
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| $ 278,817 |
| $ 2,401,503 |
| $ 9,734,386 |
| $ 5,289,744 |
Non-controlling interests |
|
| (1,649,392) |
| (1,005,511) |
| (3,250,998) |
| (2,519,886) |
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| $ (1,370,575) |
| $ 1,395,992 |
| $ 6,483,388 |
| $ 2,769,858 |
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Earnings per share (NTD) | 6(27) |
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Earnings per share-basic |
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| $ 0.14 |
| $ 0.28 |
| $ 0.73 |
| $ 0.64 |
Earnings per share-diluted |
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| $ 0.13 |
| $ 0.26 |
| $ 0.67 |
| $ 0.60 |
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The accompanying notes are an integral part of the consolidated financial statements. |
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||||||||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||||||||||||||||||||||||
UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||||||||||||||||||||||||||
For the nine-month periods ended September 30, 2018 and 2017 | ||||||||||||||||||||||||||
(Expressed in Thousands of New Taiwan Dollars) | ||||||||||||||||||||||||||
Equity Attributable to the Parent Company | ||||||||||||||||||||||||||
Capital |
| Retained Earnings | Other Components of Equity | |||||||||||||||||||||||
Notes | Common Stock | Additional | Legal Reserve | Unappropriated | Exchange Differences on Translation of Foreign Operations | Unrealized Gains or Losses on Financial Assets Measured at Fair Value through Other Comprehensive Income | Unrealized Gains or Losses on Available-for-Sale Financial Assets | Gains or Losses on hedging Instruments | Treasury Stock | Total | Non- | Total Equity | ||||||||||||||
Balance as of January 1, 2017 | 6(19) | $ 126,243,187 | $ 40,997,092 | $ 9,070,841 | $ 38,584,335 | $ 63,437 | $ - | $ 6,340,040 | $ - | $ (4,719,037) | $ 216,579,895 | $ 2,161,729 | $ 218,741,624 | |||||||||||||
Appropriation and distribution of 2016 retained earnings | 6(19) | |||||||||||||||||||||||||
Legal reserve | - | - | 831,566 | (831,566) | - | - | - | - | - | - | - | - | ||||||||||||||
Cash dividends | - | - | - | (6,112,159) | - | - | - | - | - | (6,112,159) | - | (6,112,159) | ||||||||||||||
Net income for the nine-month ended September 30, 2017 | 6(19) | - | - | - | 7,857,683 | - | - | - | - | - | 7,857,683 | (2,419,109) | 5,438,574 | |||||||||||||
Other comprehensive income (loss), net of tax for the nine-month ended September 30, 2017 | 6(19), 6(25) | - | - | - | - | (4,693,897) | - | 2,125,958 | - | - | (2,567,939) | (100,777) | (2,668,716) | |||||||||||||
Total comprehensive income (loss) | - | - | - | 7,857,683 | (4,693,897) | - | 2,125,958 | - | - | 5,289,744 | (2,519,886) | 2,769,858 | ||||||||||||||
Share of changes in net assets of associates and joint ventures accounted for | - | (19,910) | - | - | - | - | - | - | - | (19,910) | - | (19,910) | ||||||||||||||
The differences between the fair value of the consideration paid or received from acquiring | 6(19) | - | (128,848) | - | - | - | - | - | - | - | (128,848) | (1,099,544) | (1,228,392) | |||||||||||||
Changes in subsidiaries' ownership | 6(19) | - | - | - | (905,107) | - | - | - | - | - | (905,107) | 171,159 | (733,948) | |||||||||||||
Adjustments for dividends subsidiaries received from parent company | - | 8,040 | - | - | - | - | - | - | - | 8,040 | - | 8,040 | ||||||||||||||
Others | 6(19) | - | - | - | (1,320,061) | - | - | - | - | - | (1,320,061) | 2,332,135 | 1,012,074 | |||||||||||||
Balance as of September 30, 2017 | 6(19) | $ 126,243,187 | $ 40,856,374 | $ 9,902,407 | $ 37,273,125 | $ (4,630,460) | $ - | $ 8,465,998 | $ - | $ (4,719,037) | $ 213,391,594 | $ 1,045,593 | $ 214,437,187 | |||||||||||||
Balance as of January 1, 2018 | 6(19) | $ 126,243,187 | $ 40,858,350 | $ 9,902,407 | $ 38,163,492 | $ (5,715,585) | $ - | $ 8,347,962 | $ - | $ (4,719,037) | $ 213,080,776 | $ 956,808 | $ 214,037,584 | |||||||||||||
Impact of retroactive applications | 3, 6(19) | - | - | - | 17,969,706 | 3,052 | (9,867,013) | (8,347,962) | - | - | (242,217) | 1,597 | (240,620) | |||||||||||||
Adjusted balance as of January 1, 2018 | 6(19) | 126,243,187 | 40,858,350 | 9,902,407 | 56,133,198 | (5,712,533) | (9,867,013) | - | - | (4,719,037) | 212,838,559 | 958,405 | 213,796,964 | |||||||||||||
Appropriation and distribution of 2017 retained earnings | 6(19) | |||||||||||||||||||||||||
Legal reserve | - | - | 962,873 | (962,873) | - | - | - | - | - | - | - | - | ||||||||||||||
Cash dividends | - | - | - | (8,557,023) | - | - | - | - | - | (8,557,023) | - | (8,557,023) | ||||||||||||||
Net income for the nine-month ended September 30, 2018 | 6(19) | - | - | - | 8,779,603 | - | - | - | - | - | 8,779,603 | (3,136,411) | 5,643,192 | |||||||||||||
Other comprehensive income (loss), net of tax for the nine-month ended September 30, 2018 | 6(19), 6(25) | - | - | - | 21,655 | (538,894) | 1,523,474 | - | (51,452) | - | 954,783 | (114,587) | 840,196 | |||||||||||||
Total comprehensive income (loss) | - | - | - | 8,801,258 | (538,894) | 1,523,474 | - | (51,452) | - | 9,734,386 | (3,250,998) | 6,483,388 | ||||||||||||||
Share-based payment transaction | 4, 6(20) | - | 575,913 | - | - | - | - | - | - | 2,203,443 | 2,779,356 | - | 2,779,356 | |||||||||||||
Treasure stock acquired | 6(19) | - | - | - | - | - | - | - | - | (3,129,182) | (3,129,182) | - | (3,129,182) | |||||||||||||
Treasury stock cancelled | 6(19) | (2,000,000) | (1,129,182) | - | - | - | - | - | - | 3,129,182 | - | - | - | |||||||||||||
Share of changes in net assets of associates and joint ventures accounted for | - | 1,722 | - | 17,078 | - | (17,078) | - | - | - | 1,722 | - | 1,722 | ||||||||||||||
Changes in subsidiaries' ownership | 6(19) | - | - | - | (475,311) | - | - | - | - | - | (475,311) | (279,907) | (755,218) | |||||||||||||
Adjustments for dividends subsidiaries received from parent company | - | 11,442 | - | - | - | - | - | - | - | 11,442 | - | 11,442 | ||||||||||||||
Others | 6(19) | - | (48,272) | - | (1,090,952) | - | - | - | - | - | (1,139,224) | 3,065,741 | 1,926,517 | |||||||||||||
Balance as of September 30, 2018 | 6(19) | $ 124,243,187 | $ 40,269,973 | $ 10,865,280 | $53,865,375 | $ (6,251,427) | $ (8,360,617) | $ - | $ (51,452) | $ (2,515,594) | $ 212,064,725 | $ 493,241 | $ 212,557,966 | |||||||||||||
The accompanying notes are an integral part of the consolidated financial statements. |
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
For the nine-month periods ended September 30, 2018 and 2017 | ||||
(Expressed in Thousands of New Taiwan Dollars) | ||||
For the nine-month periods ended September 30, | ||||
2018 | 2017 | |||
Cash flows from operating activities: | ||||
Net income before tax | $ 4,771,170 | $ 6,049,263 | ||
Adjustments to reconcile net income before tax to net cash provided by operating activities: | ||||
Depreciation | 38,056,356 | 38,266,689 | ||
Amortization | 1,578,412 | 1,605,261 | ||
Expected credit loss | 843 | 429 | ||
Net loss (gain) of financial assets and liabilities at fair value through profit or loss | 532,756 | (512,638) | ||
Interest expense | 2,076,262 | 1,738,190 | ||
Interest income | (534,811) | (226,037) | ||
Dividend income | (600,555) | (522,428) | ||
Share-based payment | 575,355 | - | ||
Share of (profit) loss of associates and joint ventures | (480,333) | (196,334) | ||
Gain on disposal of property, plant and equipment | (125,126) | (49,229) | ||
Gain on disposal of other assets | - | (6,601) | ||
Gain on disposal of investments | (12,570) | (1,298,553) | ||
Impairment loss on financial assets | - | 695,876 | ||
Exchange loss (gain) on financial assets and liabilities | 1,286,014 | (1,789,721) | ||
Bargain purchase gain | - | (5,130) | ||
Amortization of deferred government grants | (2,894,256) | (834,190) | ||
Income and expense adjustments | 39,458,347 | 36,865,584 | ||
Changes in operating assets and liabilities: | ||||
Financial assets and liabilities at fair value through profit or loss | 499,426 | 332,574 | ||
Contract assets | (211,076) | - | ||
Notes receivable and accounts receivable | (3,321,818) | 66,808 | ||
Other receivables | 22,642 | (138,667) | ||
Inventories | 578,144 | (347,144) | ||
Prepayments | (307,901) | (710,128) | ||
Other current assets | 1,051,385 | (1,172,063) | ||
Contract fulfillment costs | (266,109) | - | ||
Contract liabilities | (1,969,523) | - | ||
Notes and accounts payable | 331,295 | (137,934) | ||
Other payables | (1,090,831) | (780,298) | ||
Other current liabilities | 273,691 | 1,766,087 | ||
Net defined benefit liabilities | (19,835) | (10,458) | ||
Other noncurrent liabilities-others | 3,240 | (209,250) | ||
Cash generated from operations | 39,802,247 | 41,574,374 | ||
Interest received | 462,509 | 216,392 | ||
Dividend received | 715,384 | 584,617 | ||
Interest paid | (1,316,387) | (1,184,494) | ||
Income tax paid | (851,396) | (1,615,308) | ||
Net cash provided by operating activities | 38,812,357 | 39,575,581 | ||
(continued) |
English Translation of Consolidated Financial Statements Originally Issued in Chinese | ||||
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES | ||||
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
For the nine-month periods ended September 30, 2018 and 2017 | ||||
(Expressed in Thousands of New Taiwan Dollars) | ||||
For the nine-month periods ended September 30, | ||||
2018 | 2017 | |||
Cash flows from investing activities: | ||||
Acquisition of financial assets at fair value through profit or loss | $ (531,762) | $ (71,388) | ||
Proceeds from disposal of financial assets at fair value through profit or loss | 653 | - | ||
Acquisition of available-for-sale financial assets | - | (864,428) | ||
Proceeds from disposal of available-for-sale financial assets | - | 1,846,831 | ||
Acquisition of financial assets measured at cost | - | (14,470) | ||
Acquisition of investments accounted for under the equity method | (840,000) | (204,280) | ||
Increase in prepayment for investments | - | (9,590) | ||
Proceeds from capital reduction and liquidation of investments | 113 | 2,034,965 | ||
Acquisition of property, plant and equipment | (15,229,219) | (33,275,050) | ||
Proceeds from disposal of property, plant and equipment | 152,521 | 78,115 | ||
Increase in refundable deposits | (1,523,556) | (90,338) | ||
Decrease in refundable deposits | 662,200 | 202,271 | ||
Acquisition of intangible assets | (546,727) | (923,905) | ||
Government grants related to assets acquisition | 6,996,355 | 1,899,096 | ||
Increase in other noncurrent assets-others | (27,654) | (25,476) | ||
Decrease in other noncurrent assets-others | 821 | 35,593 | ||
Net cash used in investing activities | (10,886,255) | (29,382,054) | ||
Cash flows from financing activities: | ||||
Increase in short-term loans | 17,281,109 | 34,965,854 | ||
Decrease in short-term loans | (27,750,312) | (31,937,548) | ||
Proceeds from bonds issued | - | 8,300,000 | ||
Bonds issuance costs | - | (9,510) | ||
Redemption of bonds | (7,500,000) | (7,500,000) | ||
Proceeds from long-term loans | 58,500 | 11,867,402 | ||
Repayments of long-term loans | (894,991) | (4,577,410) | ||
Increase in guarantee deposits | 45,838 | 181,166 | ||
Decrease in guarantee deposits | (115,039) | (3,385) | ||
Cash dividends | (8,557,312) | (6,112,036) | ||
Treasury stock acquired | (3,129,182) | - | ||
Treasury stock sold to employees | 2,204,000 | - | ||
Acquisition of subsidiaries | - | (1,228,392) | ||
Change in non-controlling interests | 596,100 | 1,944 | ||
Net cash (used in) provided by financing activities | (27,761,289) | 3,948,085 | ||
Effect of exchange rate changes on cash and cash equivalents | (319,227) | (1,782,186) | ||
Net (decrease) increase in cash and cash equivalents | (154,414) | 12,359,426 | ||
Cash and cash equivalents at beginning of period | 81,674,572 | 57,578,981 | ||
Cash and cash equivalents at end of period | $ 81,520,158 | $ 69,938,407 | ||
The accompanying notes are an integral part of the consolidated financial statements. |
UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
For theNine-Month Periods EndedSeptember 30, 2018 and 2017
(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 onOctober 24, 2018.
3. NEWLY ISSUED OR REVISED STANDARDS AND INTERPRETATIONS
A.The Company applied International Financial Reporting Standards, International Accounting Standards, and Interpretations issued, revised or amended which are recognized by Financial Supervisory Commission (“FSC”) and become effective for annual periods beginning on or after January 1, 2018. The nature and the impact of each new standard and amendment have no material effect on the Company. Apart from the potential impact of the standards and interpretations which is described below, all other standards and interpretations have no material impact on the Company’s financial position and performance.
(1) IFRS 9 “Financial Instruments”
IFRS 9 “Financial Instruments” (IFRS 9) replaced IAS 39 “Financial Instruments: Recognition and Measurement” (IAS 39) for annual periods beginning on or after January 1, 2018, which resulted impact on all three aspects of the accounting for financial instruments: classification and measurement; impairment; and hedge accounting.
(2) IFRS 15 “Revenue from Contracts with Customers” with its Amendment “Clarifications to IFRS 15 Revenue from Contracts with Customers”
The core principle of IFRS 15 “Revenue from Contracts with Customers” (IFRS 15) is that revenue is recognized 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.
(3) The Company elected to adopt the standards using the modified retrospective method recognizing the cumulative effect of initially applying IFRS 9 and IFRS 15 at January 1, 2018, not to restate the consolidated financial statements for thenine-month period ended September 30, 2017. The Company’s consolidated financial statements for thenine-month period ended September 30, 2017 were prepared in accordance with IAS 39, IAS 18 and related interpretations issued, revised or amended.
The impact on assets, liabilities and equity at the date of initial application of IFRS 9 and IFRS 15are as below:
IFRS 9
a. Financial assets measured at cost
The Company elected to designate certain of these financial assets as financial assets measured at fair value through other comprehensive income (FVOCI) and the others as financial assets measured at fair value through profit or loss (FVTPL) at the date of initial application. In accordance with the requirement of IFRS 9, these financial assets must be measured at fair value.
b. Available-for-sale financial assets
In accordance with the requirement of IFRS 9, the Company elected to designate equity instruments that are not held for trading as financial assets measured at FVOCI and classified the remaining financial assets as financial assets measured at FVTPL.
c. Impairment of financial assets
Under IFRS 9, impairment assessment is not required for equity instruments. Therefore, as the Company elected to classify certain equity investments as financial assets measured at FVOCI, the Company reclassified the related accumulated impairment loss from retained earnings to other component of equity at the date of initial application. The expected credit losses for accounts receivable or contract assets that result from transactions within the scope of IFRS 15 are evaluated by applying the simplified approach. The aforementioned impairment evaluation requirement differs from the current incurred loss model and which had no material effect on the Company.
IFRS 15
Prior to adopting IFRS 15, the Company recognized revenue upon the delivery of the wafers to carriers approved by the customers, at which point in time, the title and risk of loss for the wafers were transferred to the customers. Consideration received from customers prior to the Company having satisfied its performance obligation were accounted for as advance receipts as a component of other current liabilities. In accordance with the requirements of IFRS 15, the Company recognizes revenue as the Company satisfies its performance obligations to customers. For certain contracts that do not provide the Company unconditional rights to the consideration, the Company recognizes revenue and contract assets as it satisfies its performance obligation over time. Consideration received from customers prior to the Company having satisfied its performance obligation are accounted for as contract liabilities and the associated costs incurred to fulfill the contracts are recognized on the consolidated balance sheets as contract fulfillment costs within other current assets. In accordance with the requirement of IFRS 15, allowance for sales returns and discounts are presented as refund liabilities, different from its current presentation as a contra-account to accounts receivable.
The impact on assets, liabilities and equity as of January 1, 2018 were as follows:
|
|
|
|
|
|
|
|
| ||
Items |
| Carrying Amounts as of December 31, 2017 |
| Adjustments Arising from Initial Application |
| Adjusted Carrying Amounts as of January 1, 2018 |
| Descriptions | ||
| IFRS 9 |
| IFRS 15 | |||||||
Contract assets, current |
| $- |
| $- |
| $129,042 |
| $129,042 |
| a. |
Accounts receivable, net |
| 20,876,417 |
| - |
| 983,438 |
| 21,859,855 |
| a. b. |
Accounts receivable-related parties, net |
| 91,065 |
| - |
| 2,733 |
| 93,798 |
| b. |
Inventories, net |
| 18,257,500 |
| - |
| (102,800) |
| 18,154,700 |
| a. |
Other current assets |
| 2,645,003 |
| - |
| 120,799 |
| 2,765,802 |
| a. |
Financial assets at fair value through profit or loss, noncurrent |
| 191,005 |
| 12,449,226 |
| - |
| 12,640,231 |
| c. |
Financial assets at fair value through other comprehensive income, noncurrent |
| - |
| 10,131,459 |
| - |
| 10,131,459 |
| d. |
Available-for-sale financial assets, noncurrent |
| $20,636,332 |
| $(20,636,332) |
| $- |
| $- |
| c.d. |
Financial assets measured at cost, noncurrent |
| 2,218,472 |
| (2,218,472) |
| - |
| - |
| c.d. |
Investments accounted for under the equity method |
| 10,976,940 |
| (25,997) |
| - |
| 10,950,943 |
| e. |
Deferred tax assets |
| 6,071,582 |
| 42,388 |
| (1,489) |
| 6,112,481 |
| a. c. d. |
Total effect on assets |
|
|
| $(257,728) |
| $1,131,723 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contract liabilities, current |
| $- |
| $- |
| $3,951,414 |
| $3,951,414 |
| a. |
Current tax liabilities |
| 4,097,568 |
| - |
| 1,611 |
| 4,099,179 |
| a. |
Other current liabilities |
| 6,984,482 |
| - |
| (2,861,466) |
| 4,123,016 |
| a. b. |
Deferred tax liabilities |
| 1,631,705 |
| 23,093 |
| (37) |
| 1,654,761 |
| a. c. |
Total effect on liabilities |
|
|
| $23,093 |
| $1,091,522 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retained earnings |
| $48,065,899 |
| $17,930,334 |
| $39,372 |
| $66,035,605 |
| a. c. d. e. |
Other components of equity |
| 2,632,377 |
| (18,211,155) |
| (768) |
| (15,579,546) |
| a. b. c. d. e. |
Non-controlling interests |
| 956,808 |
| - |
| 1,597 |
| 958,405 |
| a. |
Total effect on equity |
|
|
| $(280,821) |
| $40,201 |
|
|
|
|
a. After adopting IFRS 15, the aforementioned changes in revenue recognition resulted in an increase in current contract assets amounted to NT$129 million, a decrease in net accounts receivable amounted to NT$11 million, a decrease in net inventories amounted to NT$103 million, an increase in other current assets amounted to NT$121 million, a decrease in deferred tax assets amounted to NT$1 million, an increase in current contract liabilities amounted to NT$3,951 million, an increase in current tax liabilities amounted to NT$2 million, a decrease in other current liabilities amounted to NT$3,859 million, a decrease in deferred tax liabilities amounted to NT$37 thousand, an increase in retained earnings amounted to NT$39 million, a decrease in other components of equity amounted to NT$0.3 million and an increase in non-controlling interests amounted to NT$2 million.
b. After adopting IFRS 15, the aforementioned change in the presentation of the Company’s allowance for sales returns and discounts led to an increase in net accounts receivable amounted to NT$994 million, an increase in net accounts receivable-related parties amounted to NT$3 million, an increase in other current liabilities amounted to NT$997 million and a decrease in other components of equity amounted to NT$0.5 million.
c. The Company reclassified certain noncurrent available-for-sale financial assets amounted to NT$10,738 million and certain noncurrent financial assets measured at cost amounted to NT$1,955 million as financial assets measured at fair value through profit and loss in accordance with the requirements of IFRS 9 resulting in an increase in noncurrent financial assets at fair value through profit or loss amounted to NT$12,449 million, an increase in deferred tax assets amounted to NT$37 million, an increase in deferred tax liabilities amounted to NT$23 million, an increase in retained earnings amounted to NT$3,521 million and a decrease in other components of equity amounted to NT$3,750 million.
d. The Company reclassified noncurrent available-for-sale financial assets that are not held for trading amounted to NT$9,898 million and certain noncurrent financial assets measured at cost amounted to NT$263 million as financial assets measured at fair value through other comprehensive income in accordance with the requirements of IFRS 9 resulting in an increase in noncurrent financial assets at fair value through other comprehensive income amounted to NT$10,131 million, an increase in deferred tax assets amounted to NT$5 million, an increase in retained earnings amounted to NT$12,899 million and a decrease in other components of equity amounted to NT$ 12,924 million.
e. With the adoption of IFRS 9 by associates accounted for using equity method, the corresponding adjustments made by the Company resulting in a decrease in investments accounted for using equity method amounted to NT$26 million, an increase in retained earnings amounted to NT$1,511 million and a decrease in other components of equity amounted to NT$1,537 million.
The following table shows the amount affected in the current period by the application of IFRS 15 as compared to IAS 18:
|
|
| |||||
|
| As ofSeptember 30, 2018 | |||||
Items |
| Amounts in accordance with IFRS 15 |
| Effect |
| Amounts in accordance with accounting policies for prior periods | |
Contract assets, current |
| $338,096 |
| $(338,096) |
| $- | |
Accounts receivable, net |
| 25,268,851 |
| (1,025,143) |
| 24,243,708 | |
Accounts receivable-related parties, net |
| 334,598 |
| (1,278) |
| 333,320 | |
Inventories, net |
| 17,588,556 |
| 124,833 |
| 17,713,389 | |
Other current assets |
| 1,742,809 |
| (157,109) |
| 1,585,700 | |
Deferred tax assets |
| 6,621,333 |
| (1,194) |
| 6,620,139 | |
Total effect on assets |
|
|
| $(1,397,987) |
|
| |
Contract liabilities, current |
| $1,978,822 |
| $(1,978,822) |
| $- | |
Other current liabilities |
| 5,349,106 |
| 596,806 |
| 5,945,912 | |
Deferred tax liabilities |
| 1,941,263 |
| 4,645 |
| 1,945,908 | |
Total effect on liabilities |
|
|
| $(1,377,371) |
|
| |
|
|
|
|
|
|
| |
Additional paid-in capital |
| $40,269,973 |
| $108 |
| $40,270,081 | |
Retained earnings |
| 64,730,655 |
| (23,072) |
| 64,707,583 | |
Other components of equity |
| (14,663,496) |
| 3,266 |
| (14,660,230) | |
Non-controlling interests |
| 493,241 |
| (918) |
| 492,323 | |
Total effect on equity |
|
|
| $(20,616) |
|
| |
|
|
|
|
|
|
| |
|
| For the three-month period endedSeptember 30, 2018 | |||||
Items |
| Amounts in accordance with IFRS 15 |
| Effect |
| Amounts in accordance with accounting policies for prior periods | |
Operating revenue |
| $39,386,656 |
| $30,920 |
| $39,417,576 | |
Operating costs |
| (32,465,029) |
| 9,166 |
| (32,455,863) | |
Operating expenses |
| (5,701,245) |
| (28,505) |
| (5,729,750) | |
Income tax expense (benefit) |
| (631,665) |
| (5,672) |
| (637,337) | |
Total effect on income and expenses |
|
|
| $5,909 |
|
| |
|
|
|
|
|
|
| |
|
| For the nine-month period endedSeptember 30, 2018 | |||||
Items |
| Amounts in accordance with IFRS 15 |
| Effect |
| Amounts in accordance with accounting policies for prior periods | |
Operating revenue |
| $115,735,370 |
| $39,577 |
| $115,774,947 | |
Operating costs |
| (97,496,569) |
| 70,841 |
| (97,425,728) | |
Operating expenses |
| (15,763,576) |
| (84,499) |
| (15,848,075) | |
Income tax expense (benefit) |
| 872,022 |
| (8,940) |
| 863,082 | |
Total effect on income and expenses |
|
|
| $16,979 |
|
| |
B. Standards issued byInternational Accounting Standards Board (IASB) which are endorsed by FSC, but not yet adopted by the Company are listed below:
|
|
|
|
|
No. |
| The projects of Standards or Interpretations |
| Effective for annual periods beginning on or after |
IFRS 16 |
| Leases |
| January 1, 2019 |
IFRIC 23 |
| Uncertainty Over Income Tax Treatments |
| January 1, 2019 |
IAS 28 |
| Long-term Interests in Associates and Joint Ventures |
| January 1, 2019 |
IFRS 9 |
| Financial Instruments – Prepayment Features with Negative Compensation |
| January 1, 2019 |
|
| Improvements to International Financial Reporting Standards (2015 - 2017 cycle) |
|
|
IFRS 3 |
| Business Combinations |
| January 1, 2019 |
IFRS 11 |
| Joint Arrangements |
| January 1, 2019 |
IAS 12 |
| Income Taxes |
| January 1, 2019 |
IAS 23 |
| Borrowing Costs |
| January 1, 2019 |
IAS 19 |
| Employee Benefits |
| January 1, 2019 |
The potential effects of adopting the standards or interpretations issued by IASB and endorsed by FSC on the Company’s financial statements in future periods are summarized as below:
(4) IFRS 16 “Leases”
The new standard requires lessees to account for all leases under a single on-balance sheet model (subject to certain exemptions). Lessor accounting still uses the dual classification approach: operating lease and finance lease.
(5) IFRIC 23 “Uncertainty Over Income Tax Treatments”
The Interpretation clarifies application of recognition and measurement requirements in IAS 12 “Income Taxes” when there is uncertainty over income tax treatments.
(6) IAS 28“Investment in Associates and Joint Ventures” (Amendment)
The amendment clarifies that an entity applies IFRS 9 to long-term interests in an associate or joint venture that form part of the net investment in the associate or joint venture before it appliesIAS 28 “Investments in Associates and Joint Ventures” (IAS 28), and in applying IFRS 9, does not take account of any adjustments that arise from applying IAS 28.
(7) IFRS 9 “Financial Instruments” (Amendment)
The amendment allows financial assets with prepayment features that permit or require a party to a contract either to pay or receive reasonable compensation for the early termination of the contract, to be measured at amortised cost or at fair value through other comprehensive income.
(8) IAS 12 “Income Taxes”
The amendments clarify that an entity shall recognize the income tax consequences of dividends in profit or loss, other comprehensive income or equity according to where the entity originally recognized those past transactions or events.
(9) IAS 19 “Employee Benefits” (Amendment)
The amendments clarify that when a change in a defined benefit plan is made (such as amendment, curtailment or settlement, etc.), the entity should use the updated assumptions to remeasure its net defined benefit liability or asset.
The abovementioned standards and interpretations issued by IASB and endorsed by FSC so that they are applicable for annual periods beginning on or after January 1, 2019. The Company is currently evaluating the potential impact of the aforementioned standards and interpretations listed (4) ~ (9) to the Company’s financial position and performance, and the related impact will be disclosed when the evaluation is completed.
C. Standards issued by IASB but not yet endorsed by FSC (the effective dates are to be determined by FSC) are listed below:
No. |
| The projects of Standards or Interpretations |
| Effective for annual periods beginning on or after |
IFRS 10 and IAS 28 |
| Sale or Contribution of Assets between an Investor and its Associate or Joint Venture |
| To be determined by IASB |
IFRS 17 |
| Insurance Contracts |
| January 1, 2021 |
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:
(10)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” (IFRS 10) and IAS 28, 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 venture. IFRS 10 requires full profit or loss recognition on the loss of control of a 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 “Business Combinations” (IFRS 3) between an investor and its associate or joint venture is recognized in full. IFRS 10 was also amended so that the gain 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 effective date of this amendment has been deferred indefinitely, but early adoption is allowed.
The Company is currently evaluating the potential impact of the aforementioned standards and interpretations listed (10) 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) and IAS 34 “Interim Financial Reporting” which is endorsed and become effective by FSC.
(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 year ended December 31, 2017. For the principles of consolidation, please refer to Note 4(3) of the Company’s consolidated financial statements for the year ended December 31, 2017.
b. The consolidated entities are as follows:
As ofSeptember 30, 2018, December 31, 2017 andSeptember 30, 2017
|
|
|
|
|
|
| ||||
|
|
|
|
|
| Percentage of ownership (%) As of | ||||
Investor |
| Subsidiary |
| Business nature |
| September 30, 2018 |
| December 31, 2017 |
| September30, 2017 |
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) |
| Venture capital |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| UMC NEW BUSINESS INVESTMENT CORP. (NBI) |
| Investment holding |
| - |
| 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 venture capital |
| 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 |
| SINO PARAGON LIMITED |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
UMC |
| BEST ELITE INTERNATIONAL LIMITED (BE) |
| Investment holding |
| 100.00 |
| 96.66 |
| 96.32 |
UMC, FORTUNE and TLC |
| NEXPOWER TECHNOLOGY CORP. (NEXPOWER) |
| Sales and manufacturing of solar power batteries |
| 93.36 |
| 87.06 |
| 87.06 |
UMC and FORTUNE |
| WAVETEK MICROELECTRONICS CORPORATION (WAVETEK) |
| Sales and manufacturing of integrated circuits |
| 78.47 |
| 78.47 |
| 78.47 |
UMC CAPITAL CORP. |
| UMC CAPITAL (USA) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
TLC |
| SOARING CAPITAL CORP. |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
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 |
| 100.00 |
| 100.00 |
UMC INVESTMENT (SAMOA) LIMITED |
| UMC (BEIJING) LIMITED |
| Marketing support activities |
| - |
| 100.00 |
| 100.00 |
FORTUNE |
| TERA ENERGY DEVELOPMENT CO., LTD. (TERA ENERGY) |
| Energy technical services |
| 100.00 |
| - |
| - |
FORTUNE |
| UNISTARS CORP. (UNISTARS) |
| High brightness LED packages |
| 83.69 |
| - |
| - |
NBI |
| TERA ENERGY |
| Energy technical services |
| - |
| 100.00 |
| 100.00 |
NBI |
| UNISTARS |
| High brightness LED packages |
| - |
| 83.69 |
| 82.76 |
TERA ENERGY |
| EVERRICH ENERGY INVESTMENT (HK) LIMITED (EVERRICH-HK) |
| Investment holding |
| 100.00 |
| 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 |
| 100.00 |
OMNI |
| ECP VITA PTE. LTD. |
| Insurance |
| 100.00 |
| 100.00 |
| 100.00 |
OMNI |
| UMC TECHNOLOGY JAPAN CO., LTD. |
| Semiconductor manufacturing technology development and consulting services |
| 100.00 |
| 100.00 |
| 100.00 |
WAVETEK |
| WAVETEK MICROELECTRONICS INVESTMENT (SAMOA) LIMITED (WAVETEK-SAMOA) |
| Investment holding |
| 100.00 |
| 100.00 |
| 100.00 |
WAVETEK- SAMOA |
| WAVETEK MICROELECTRONICS CORPORATION (USA) |
| Sales and marketing service |
| 100.00 |
| 100.00 |
| 100.00 |
NEXPOWER |
| SOCIALNEX ITALIA 1 S.R.L. |
| Photovoltaic power plant |
| 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 |
| 98.14 |
| 100.00 |
| 100.00 |
HEJIAN |
| UNITEDDS SEMICONDUCTOR (SHANDONG) CO., LTD. |
| Integrated circuits design services |
| 100.00 |
| 100.00 |
| 100.00 |
UNITED MICROCHIP CORPORATION and HEJIAN |
| UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. (USC) |
| Sales and manufacturing of integrated circuits |
| 65.22 |
| 51.02 |
| 51.02 |
(4) Other Significant Accounting Policies
Apart from the accounting policies which are described below, the same accounting policies have been applied in the Company’s consolidated financial statements for the nine-month period ended September 30, 2018 as those applied in the Company’s consolidated financial statements for the year ended December 31, 2017 and the three-month period ended March 31, 2018. For the summary of other significant accounting policies, please refer to Note 4 of the Company’s consolidated financial statements for the year ended December 31, 2017 and the three-month period ended March 31, 2018.
a. Cash flow hedges
The Company manages exposures arising from the foreign currency exchange risk. With the adoption of IFRS 9 on January 1, 2018, the Company designates a hedging relationship between the hedging instrument and the hedged item with the existence of an economic relationship and determines the hedge ratio to meet the hedge effectiveness. The Company designates certain hedging instruments to partially hedge the foreign currency exchange rate risks associated with certain highly probable forecast transactions. The separate component of equity associated with the hedged item is adjusted to the lower of the following (in absolute amounts):
(i) the cumulative gain or loss on the hedging instrument from inception of the hedge; and
(ii) the cumulative change in fair value (present value) of the expected future cash flows on the hedged item from inception of the hedge
The portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is recognized in other comprehensive income, whereas the ineffective portion of the change in the fair value of the hedging instrument is recognized directly in profit or loss. If a hedge of a forecast transaction subsequently results in the recognition of a non-financial asset or a non-financial liability, the associated gains or losses that were recognized in other comprehensive income are removed from equity and included in the initial cost of the asset or liability.
The Company prospectively discontinues hedge accounting only when the hedging relationship ceases to meet the qualifying criteria; for instance when the hedging instrument expires or is sold, terminated or exercised.
b. Share-Based Payment Transactions
The cost of equity-settled transactions between the Company and its employees is measured at the fair value using an appropriate pricing model by reference to the market price of the equity instruments on the grant date.
The cost of equity-settled transactions is recognized, together with a corresponding increase in other capital reserves in equity, over the periods in which the performance and/or service conditions are being fulfilled. The cumulative expense recognized for equity-settled transactions at each reporting date reflects the extent to which the vesting period has passed and the Company’s best estimate of the quantity of equity instruments that will ultimately vest. The charge to profit or loss for a period represents the movement in cumulative expense recognized between the beginning and the end of that period.
No expense will be recognized for awards that do not ultimately vest, except for equity-settled transactions for which vesting is conditional upon a market or non-vesting condition. These are treated as vested irrespective of whether the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied.
Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified, if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee as measured at the date of modification.
Where an equity-settled award is cancelled, it is treated as if it fully vests on the date of cancellation, and any expense not yet recognized for the award is recognized immediately. This includes any award where non-vesting conditions within the control of either the entity or the employee are not met. However, if a new award substitutes for the cancelled award and is designated as a replacement award on the date that it is granted, the cancelled and new awards are treated as if they were a modification of the original award.
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 nine-month period endedSeptember 30, 2018 as those applied in the Company’s consolidated financial statements for the year ended December 31, 2017. For significant accounting judgments, estimates and assumptions, please refer to Note 5 of the Company’s consolidated financial statements for the year ended December 31, 2017.
6. CONTENTS OF SIGNIFICANT ACCOUNTS
(1) Cash andCash Equivalents
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Cash on hand |
| $6,566 |
| $4,360 |
| $4,189 |
Checking and savings accounts |
| 34,403,374 |
| 21,699,357 |
| 17,373,386 |
Time deposits |
| 38,327,692 |
| 50,711,803 |
| 43,251,557 |
Repurchase agreements collateralized by government and corporate bonds |
| 8,782,526 |
| 9,259,052 |
| 9,309,275 |
Total |
| $81,520,158 |
| $81,674,572 |
| $69,938,407 |
(2) Financial Assets at Fair Value through Profit or Loss
|
|
| ||||
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 (Note) |
| September 30, 2017 (Note) |
Financial assets mandatorily measured at fair value through profit or loss |
|
|
|
|
|
|
Common stocks |
| $7,497,522 |
|
|
|
|
Preferred stocks |
| 3,388,420 |
|
|
|
|
Funds |
| 1,795,919 |
|
|
|
|
Convertible Bonds |
| 223,768 |
|
|
|
|
Forward contracts |
| 25,376 |
|
|
|
|
Subtotal |
| $12,931,005 |
|
|
|
|
Designated financial assets at fair value through profit or loss |
|
|
|
|
|
|
Convertible bonds |
|
|
| $213,180 |
| $228,250 |
|
|
|
|
|
|
|
Financial assets held for trading |
|
|
|
|
|
|
Common stocks |
|
|
| 434,630 |
| 541,233 |
Preferred stocks |
|
|
| 228,508 |
| 195,975 |
Funds |
|
|
| - |
| 49,874 |
Option |
|
|
| 31,605 |
| - |
Forward exchange contracts |
|
|
| - |
| 2,146 |
Subtotal |
|
|
| 694,743 |
| 789,228 |
Total |
|
|
| $907,923 |
| $1,017,478 |
|
|
|
|
|
|
|
Current |
| $422,326 |
| $716,918 |
| $844,078 |
Noncurrent |
| 12,508,679 |
| 191,005 |
| 173,400 |
Total |
| $12,931,005 |
| $907,923 |
| $1,017,478 |
On June 29, 2018, the Board of Directors of UMC resolved to exercise the call option of ajoint venture agreement betweenFUJITSU SEMICONDUCTOR LIMITED (FSL) and UMC. Upon obtaining R.O.C. government authority’s approval of the investment application, the Company anticipates that its investment could reachNT$15.1 billion foracquiring remaining shares of MIE FUJITSU SEMICONDUCTOR LIMITED (MIFS) from the other stockholder on January 1, 2019, representing ownership interest of 84.1% and making MIFS a wholly-owned subsidiary of the Company. The change of the fair value for the call option is recorded in profit or loss.
Note: The Company adopted IFRS 9 on January 1, 2018. The Company elected not to restate prior periods in accordance with the transition provision in IFRS 9. Please refer to Note 6(6) and Note 6(7) for available-for-sale financial assets, non-current and financial assets measured at cost, non-current, respectively as of December 31, 2017 andSeptember 30, 2017.
(3) Accounts Receivable, Net
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Accounts receivable |
| $25,303,369 |
| $21,910,146 |
| $24,577,517 |
Less: allowance for sales returns and discounts |
| - |
| (994,151) |
| (2,096,309) |
Less: loss allowance |
| (34,518) |
| (39,578) |
| (89,747) |
Net |
| $25,268,851 |
| $20,876,417 |
| $22,391,461 |
Aging analysis of accounts receivable, net:
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Neither past due nor impaired |
| $20,600,635 |
| $15,496,207 |
| $17,852,109 |
Past due but not impaired: |
|
|
|
|
|
|
≤ 30 days |
| 3,605,016 |
| 4,268,772 |
| 3,020,061 |
31 to 60 days |
| 521,452 |
| 444,401 |
| 678,459 |
61 to 90 days |
| 214,107 |
| 138,178 |
| 344,397 |
91 to 120 days |
| 121,933 |
| 124,332 |
| 259,058 |
≥ 121 days |
| 205,708 |
| 404,527 |
| 237,377 |
Subtotal |
| 4,668,216 |
| 5,380,210 |
| 4,539,352 |
Total |
| $25,268,851 |
| $20,876,417 |
| $22,391,461 |
Movement on individually evaluated loss allowance:
|
| For the nine-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Beginning balance |
| $39,578 |
| $86,595 |
Net charge for the period |
| (5,060) |
| 3,152 |
Ending balance |
| $34,518 |
| $89,747 |
The collection periods for third party domestic sales and third party overseas sales were month-end 30~60 days and net 30~120 days, respectively.
The impairment losses assessed individually as ofSeptember 30, 2018 and 2017 primarily at an amount equal to lifetime expected credit losses 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 | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Raw materials |
| $3,403,274 |
| $2,354,410 |
| $2,182,402 |
Supplies and spare parts |
| 3,244,081 |
| 3,007,669 |
| 2,942,208 |
Work in process |
| 9,628,330 |
| 11,492,450 |
| 10,951,912 |
Finished goods |
| 1,312,871 |
| 1,402,971 |
| 1,025,804 |
Total |
| $17,588,556 |
| $18,257,500 |
| $17,102,326 |
a. For the three-month periods endedSeptember 30, 2018 and 2017, the Company recognized NT$31,386 million and NT$30,215 million, respectively, in operating cost, of which NT$245 million and NT$807 million were related to write-down of inventories. For the nine-month periods endedSeptember 30, 2018 and 2017, the Company recognized NT$94,100 million and NT$89,031 million, respectively, in operating cost, of which NT$800 million and NT$1,360 million were related to write-down of inventories.
b. None of the aforementioned inventories were pledged.
(5) Financial Assets at Fair Value through Other Comprehensive Income, Non-Current
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 (Note) |
| September 30, 2017 (Note) |
Equity instruments |
|
|
|
|
|
|
Common stocks |
| $11,490,995 |
|
|
|
|
Preferred stocks |
| 231,995 |
|
|
|
|
Total |
| $11,722,990 |
|
|
|
|
Note: The Company adopted IFRS 9 on January 1, 2018. The Company elected not to restate prior periods in accordance with the transition provision in IFRS 9. Please refer to Note 6(6) and Note 6(7) for available-for-sale financial assets, non-current and financial assets measured at cost, non-current , respectively as of December 31, 2017 andSeptember 30, 2017.
(6) Available-For-Sale Financial Assets, Non-Current
|
| As of | ||
|
| December 31, 2017 |
| September 30, 2017 |
Common stocks |
| $17,653,513 |
| $18,193,054 |
Preferred stocks |
| 1,865,410 |
| 1,851,108 |
Funds |
| 1,117,409 |
| 1,011,699 |
Total |
| $20,636,332 |
| $21,055,861 |
(7) Financial Assets Measured at Cost, Non-Current
|
| As of | ||
|
| December 31, 2017 |
| September 30, 2017 |
Common stocks |
| $473,134 |
| $481,569 |
Preferred stocks |
| 1,657,388 |
| 1,959,670 |
Funds |
| 87,950 |
| 89,201 |
Total |
| $2,218,472 |
| $2,530,440 |
Since these financial assets mostly consist of non-publicly traded stocks and private venture funds, for which the fair values cannot be reliably measured due to lack of sufficient financial information available, the Company measures these financial assets at cost.
(8) Investments Accounted For Under the Equity Method
a. Details of investments accounted for under the equity method are as follows:
|
|
| ||||||||||
|
| As of | ||||||||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 | ||||||
Investee companies |
| Amount |
| Percentage of ownership or voting rights |
| Amount |
| Percentage of ownership or voting rights |
| Amount |
| Percentage of ownership or voting rights |
Listed companies |
|
|
|
|
|
|
|
|
|
|
|
|
CLIENTRON CORP. |
| $245,969 |
| 22.39 |
| $265,327 |
| 22.39 |
| $262,081 |
| 22.39 |
FARADAY TECHNOLOGY CORP. (FARADAY) (Note A) |
| 1,514,149 |
| 13.78 |
| 1,669,693 |
| 13.78 |
| 1,683,526 |
| 13.94 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Unlisted companies |
|
|
|
|
|
|
|
|
|
|
|
|
WINAICO SOLAR PROJEKT 1 GMBH (Note B) |
| - |
| 50.00 |
| - |
| 50.00 |
| - |
| 50.00 |
MTIC HOLDINGS PTE. LTD. |
| 69,173 |
| 45.44 |
| 50,743 |
| 45.44 |
| 76,917 |
| 45.44 |
YUNG LIINVESTMENTS, INC. |
| 36,385 |
| 45.16 |
| 42,173 |
| 45.16 |
| 90,019 |
| 45.16 |
WINAICO IMMOBILIEN GMBH (Note B) |
| - |
| 44.78 |
| - |
| 44.78 |
| - |
| 44.78 |
UNITECH CAPITAL INC. |
| 651,276 |
| 42.00 |
| 732,267 |
| 42.00 |
| 680,330 |
| 42.00 |
TRIKNIGHT CAPITAL CORPORATION |
| 1,562,617 |
| 40.00 |
| 894,809 |
| 40.00 |
| 812,195 |
| 40.00 |
HSUN CHIEH INVESTMENT CO., LTD. |
| 4,447,493 |
| 36.49 |
| 3,930,434 |
| 36.49 |
| 3,960,330 |
| 36.49 |
YANN YUAN INVESTMENT CO., LTD. |
| $2,967,495 |
| 30.87 |
| $2,810,625 |
| 30.87 |
| $2,765,477 |
| 30.87 |
HSUN CHIEH CAPITAL CORP. |
| 173,367 |
| 30.00 |
| 176,911 |
| 30.00 |
| 181,355 |
| 30.00 |
VSENSE CO., LTD. |
| 72,987 |
| 28.63 |
| 78,294 |
| 28.63 |
| 79,901 |
| 28.63 |
UNITED LED CORPORATION HONG KONG LIMITED |
| 177,562 |
| 25.14 |
| 216,707 |
| 25.14 |
| 241,157 |
| 25.14 |
TRANSLINK CAPITAL PARTNERS I, L.P. (Note C) |
| 110,470 |
| 10.38 |
| 108,925 |
| 10.38 |
| 101,937 |
| 10.38 |
SHANDONG HUAHONG ENERGY INVEST CO., INC. (SHANDONG HUAHONG)(Note B) |
| - |
| - |
| - |
| 50.00 |
| - |
| 50.00 |
CTC CAPITAL PARTNERS I, L.P. |
| - |
| - |
| 32 |
| 31.40 |
| 32,723 |
| 31.40 |
Total |
| $12,028,943 |
|
|
| $10,976,940 |
|
|
| $10,967,948 |
|
|
Note A: Beginning from June 2015, the Company accounts for its investment in FARADAY as an associate given the fact that the Company obtained the ability to exercise significant influence over FARADAY through representation on its Board of Directors.
Note B: SHANDONG HUAHONG, WINAICO SOLAR PROJEKT 1 GMBH and WINAICO IMMOBILIEN GMBH are joint ventures to the Company.
Note C: The Company follows international accounting practices in equity accounting for limited partnerships and 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$1,760 million, NT$1,935 million and NT$1,946 million, as of September 30, 2018, December 31, 2017 and September 30, 2017, respectively. The fair value of these investments were NT$2,009 million, NT$2,142 million and NT$1,629 million, as of September 30, 2018, December 31, 2017 and September 30, 2017, respectively.
Certain investments accounted for under the equity method were reviewed by other independent accountants. Shares of profit or loss of these associates and joint ventures amounted toNT$17 million, NT$197 million, NT$364 million and NT$156 million for the three-month and nine-month periods ended September 30, 2018 and 2017, respectively. Share of other comprehensive income (loss) of these associates and joint ventures amounted toNT$(54) million, NT$171 million, NT$84 million and NT$1,311 million for the three-month and nine-month periods ended September 30, 2018 and 2017, respectively. The balances of investments accounted for under the equity method wereNT$9,875million,NT$8,998 million and NT$8,480 million as ofSeptember 30, 2018,December 31, 2017 and September 30, 2017,respectively.
None of the aforementioned associates and joint ventures were pledged.
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 nine-month periods ended September 30, 2018 and 2017 were NT$1 million, NT$(0)million, NT$8 million and NT$60 million, respectively,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 periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Income(loss)from continuing operations |
| $193,182 |
| $204,834 |
Income(loss)from discontinued operationsafter income tax |
| - |
| - |
Other comprehensive income (loss) |
| (224,949) |
| 131,115 |
Total comprehensive income (loss) |
| $(31,767) |
| $335,949 |
|
| For the nine-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Income(loss)from continuing operations |
| $480,333 |
| $116,086 |
Income(loss)from discontinued operationsafter income tax |
| - |
| 80,248 |
Other comprehensive income (loss) |
| (93,802) |
| 1,271,288 |
Total comprehensive income (loss) |
| $386,531 |
| $1,467,622 |
(ii) The aggregate amount of the Company’s share of its joint ventures that are accounted for using the equity method were nil for the three-month and nine-month periods endedSeptember 30, 2018 and 2017.
c. One of UMC’s associates, HSUN CHIEH INVESTMENT CO., LTD., held 441 million shares of UMC’s stock as ofSeptember 30, 2018, December 31, 2017 and September 30, 2017. Another associate, YANN YUAN INVESTMENT CO., LTD., held 172 million shares of UMC’s stock as ofSeptember 30, 2018,December 31, 2017 and September 30, 2017.
(9) Property, Plant and Equipment
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Land |
| $1,314,402 |
| $1,314,402 |
| $1,314,402 |
Buildings |
| 20,196,577 |
| 21,112,807 |
| 20,980,018 |
Machinery and equipment |
| 147,087,224 |
| 160,497,062 |
| 166,395,709 |
Transportation equipment |
| 16,973 |
| 18,751 |
| 20,205 |
Furniture and fixtures |
| 1,931,123 |
| 2,038,816 |
| 2,079,852 |
Leasehold improvement |
| 4,618 |
| 4,353 |
| 6,906 |
Construction in progress and equipment awaiting inspection |
| 7,165,517 |
| 20,755,490 |
| 16,569,898 |
Net |
| $177,716,434 |
| $205,741,681 |
| $207,366,990 |
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, 2018 |
| $1,314,402 |
| $38,073,660 |
| $826,268,919 |
| $75,782 |
| $7,675,798 |
| $52,557 |
| $20,761,439 |
| $894,222,557 |
Additions |
| - |
| - |
| - |
| - |
| - |
| - |
| 11,667,816 |
| 11,667,816 |
Disposals |
| - |
| (51,504) |
| (1,854,826) |
| (11,090) |
| (32,704) |
| - |
| - |
| (1,950,124) |
Transfers and reclassifications |
| - |
| 408,898 |
| 24,550,183 |
| 3,221 |
| 326,499 |
| 2,050 |
| (25,263,730) |
| 27,121 |
Exchange effect |
| - |
| (161,749) |
| 946,443 |
| (145) |
| (16,341) |
| 736 |
| 5,941 |
| 774,885 |
As of September 30, 2018 |
| $1,314,402 |
| $38,269,305 |
| $849,910,719 |
| $67,768 |
| $7,953,252 |
| $55,343 |
| $7,171,466 |
| $904,742,255 |
|
| Land |
| Buildings |
| Machinery and equipment |
| Transportation equipment |
| Furniture and fixtures |
| Leasehold improvement |
| Construction in progress and equipment awaiting inspection |
| Total |
As of January 1, 2017 |
| $1,314,402 |
| $37,042,323 |
| $785,442,975 |
| $78,314 |
| $6,826,957 |
| $69,245 |
| $45,048,631 |
| $875,822,847 |
Additions |
| - |
| - |
| - |
| - |
| - |
| - |
| 20,914,841 |
| 20,914,841 |
Disposals |
| - |
| - |
| (1,916,769) |
| (5,774) |
| (28,327) |
| - |
| - |
| (1,950,870) |
Transfers and reclassifications |
| - |
| 936,608 |
| 49,207,932 |
| 4,266 |
| 827,865 |
| 1,529 |
| (48,789,917) |
| 2,188,283 |
Exchange effect |
| - |
| (376,133) |
| (9,339,330) |
| (839) |
| (26,656) |
| (2,745) |
| (597,708) |
| (10,343,411) |
As of September 30, 2017 |
| $1,314,402 |
| $37,602,798 |
| $823,394,808 |
| $75,967 |
| $7,599,839 |
| $68,029 |
| $16,575,847 |
| $886,631,690 |
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, 2018 |
| $- |
| $16,960,853 |
| $665,771,857 |
| $57,031 |
| $5,636,982 |
| $48,204 |
| $5,949 |
| $688,480,876 |
Depreciation |
| - |
| 1,150,336 |
| 36,501,464 |
| 4,621 |
| 398,201 |
| 1,734 |
| - |
| 38,056,356 |
Disposals |
| - |
| (50,164) |
| (1,815,637) |
| (11,011) |
| (18,049) |
| - |
| - |
| (1,894,861) |
Transfers and reclassifications |
| - |
| 299 |
| (3,187) |
| - |
| 2,888 |
| - |
| - |
| - |
Exchange effect |
| - |
| 11,404 |
| 2,368,998 |
| 154 |
| 2,107 |
| 787 |
| - |
| 2,383,450 |
As ofSeptember 30, 2018 |
| $- |
| $18,072,728 |
| $702,823,495 |
| $50,795 |
| $6,022,129 |
| $50,725 |
| $5,949 |
| $727,025,821 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Land |
| Buildings |
| Machinery and equipment |
| Transportation equipment |
| Furniture and fixtures |
| Leasehold improvement |
| Construction in progress and equipment awaiting inspection |
| Total |
As of January 1, 2017 |
| $- |
| $15,612,462 |
| $629,903,740 |
| $56,356 |
| $5,198,998 |
| $61,938 |
| $5,949 |
| $650,839,443 |
Depreciation |
| - |
| 1,121,592 |
| 36,767,157 |
| 4,206 |
| 371,864 |
| 1,870 |
| - |
| 38,266,689 |
Disposals |
| - |
| - |
| (1,914,362) |
| (5,774) |
| (28,125) |
| - |
| - |
| (1,948,261) |
Transfers and reclassifications |
| - |
| - |
| (3,277) |
| 1,587 |
| 1,690 |
| - |
| - |
| - |
Exchange effect |
| - |
| (111,274) |
| (7,754,159) |
| (613) |
| (24,440) |
| (2,685) |
| - |
| (7,893,171) |
As ofSeptember 30, 2017 |
| $- |
| $16,622,780 |
| $656,999,099 |
| $55,762 |
| $5,519,987 |
| $61,123 |
| $5,949 |
| $679,264,700 |
Please refer to Note 8 for property, plant and equipment pledged as collateral.
(10)Intangible Assets
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Goodwill |
| $15,188 |
| $15,188 |
| $15,188 |
Software |
| 575,457 |
| 410,712 |
| 409,076 |
Patents and technology license fees |
| 1,715,143 |
| 2,102,561 |
| 2,209,616 |
Others |
| 900,863 |
| 1,259,048 |
| 1,238,707 |
Net |
| $3,206,651 |
| $3,787,509 |
| $3,872,587 |
Cost:
|
| Goodwill |
| Software |
| Patents and technology license fees |
| Others |
| Total |
As of January 1, 2018 |
| $15,188 |
| $1,080,726 |
| $4,687,751 |
| $3,565,705 |
| $9,349,370 |
Additions |
| - |
| - |
| 214,278 |
| 480,273 |
| 694,551 |
Disposals |
| - |
| (343,613) |
| - |
| (918,923) |
| (1,262,536) |
Reclassifications |
| - |
| 419,769 |
| - |
| - |
| 419,769 |
Exchange effect |
| - |
| (9,733) |
| (303,584) |
| (0) |
| (313,317) |
As of September30, 2018 |
| $15,188 |
| $1,147,149 |
| $4,598,445 |
| $3,127,055 |
| $8,887,837 |
|
| Goodwill |
| Software |
| Patents and technology license fees |
| Others |
| Total |
As of January 1, 2017 |
| $15,188 |
| $903,993 |
| $4,534,340 |
| $3,429,640 |
| $8,883,161 |
Additions |
| - |
| 2,932 |
| 39,002 |
| 854,208 |
| 896,142 |
Disposals |
| - |
| (56,334) |
| - |
| (903,176) |
| (959,510) |
Reclassifications |
| - |
| 191,241 |
| - |
| - |
| 191,241 |
Exchange effect |
| - |
| (8,048) |
| 110,641 |
| 5 |
| 102,598 |
As of September 30, 2017 |
| $15,188 |
| $1,033,784 |
| $4,683,983 |
| $3,380,677 |
| $9,113,632 |
Accumulated Amortization and Impairment:
|
| Goodwill |
| Software |
| Patents and technology license fees |
| Others |
| Total |
As of January 1, 2018 |
| $- |
| $670,014 |
| $2,585,190 |
| $2,306,657 |
| $5,561,861 |
Amortization |
| - |
| 250,399 |
| 346,701 |
| 838,459 |
| 1,435,559 |
Disposals |
| - |
| (343,613) |
| (55) |
| (918,924) |
| (1,262,592) |
Exchange effect |
| - |
| (5,108) |
| (48,534) |
| 0 |
| (53,642) |
As of September 30, 2018 |
| $- |
| $571,692 |
| $2,883,302 |
| $2,226,192 |
| $5,681,186 |
|
| Goodwill |
| Software |
| Patents and technology license fees |
| Others |
| Total |
As of January 1, 2017 |
| $- |
| $433,537 |
| $2,143,372 |
| $2,217,949 |
| $4,794,858 |
Amortization |
| - |
| 251,617 |
| 363,106 |
| 827,192 |
| 1,441,915 |
Disposals |
| - |
| (56,334) |
| - |
| (903,176) |
| (959,510) |
Exchange effect |
| - |
| (4,112) |
| (32,111) |
| 5 |
| (36,218) |
As of September 30, 2017 |
| $- |
| $624,708 |
| $2,474,367 |
| $2,141,970 |
| $5,241,045 |
The amortization amounts of intangible assets are as follows:
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Operating costs |
| $210,514 |
| $204,848 |
Operating expenses |
| $248,116 |
| $242,962 |
|
| For the nine-monthperiods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Operating cost |
| $556,393 |
| $599,514 |
Operating expense |
| $879,166 |
| $842,401 |
(11)Short-Term Loans
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Unsecured bank loans |
| $7,365,132 |
| $19,159,298 |
| $17,093,638 |
Unsecured other loans |
| 7,452,672 |
| 6,286,242 |
| 5,575,968 |
Total |
| $14,817,804 |
| $25,445,540 |
| $22,669,606 |
|
| For the nine-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Interest rates applied |
| 0.00%~4.35% |
| 0.00%~4.35% |
The Company’s unused short-term lines of credit amounted to NT$72,681 million, NT$62,057 million and NT$60,322 million as of September 30, 2018, December 31, 2017 and September 30, 2017, respectively.
(12)Financial Liabilities at Fair Value through Profit or Loss, Current
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Forward contracts |
| $- |
| $- |
| $22,361 |
(13) Hedging financial liabilities, current
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Cash flow hedges-Forward exchange contracts |
| $64,315 |
| $- |
| $- |
The company designates certain forward exchange contracts to partially hedge foreign currency exchange rate risks associated with a certain highly probable forecast transaction, the purchase of remaining outstanding shares of MIFS in JPY.
The following tables summarize the information relating to the hedges for foreign currency exchange risk as of September 30, 2018
Hedging Instruments |
| Contract Amount |
| Maturity |
| Change in fair value used for measuring ineffectiveness for the period |
|
|
| ||||
Forward exchange contracts |
| Buy JPY 10,000 million |
| 2018.09.05~2018.12.13 |
| $64,315 |
Hedged Items |
| Change in fair value used for measuring ineffectiveness |
| Cash flow hedge reserve |
|
| |||
Cash flow hedges-forecast transactions |
| $(64,315) |
| $(64,315) |
As of December 31, 2017 and September 30, 2017: None.
(14)Bonds Payable
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Unsecured domestic bonds payable |
| $23,700,000 |
| $31,200,000 |
| $25,800,000 |
Unsecured convertible bonds payable |
| 18,196,332 |
| 18,196,332 |
| 18,196,332 |
Less: Discounts on bonds payable |
| (608,954) |
| (878,701) |
| (961,449) |
Total |
| 41,287,378 |
| 48,517,631 |
| 43,034,883 |
Less: Current portion |
| (2,498,775) |
| (24,841,770) |
| (24,754,018) |
Net |
| $38,788,603 |
| $23,675,861 |
| $18,280,865 |
A. UMC issued domestic unsecured corporate bonds. The terms and conditions of the bonds were as follows:
Term |
| Issuance date |
| Issued amount |
| Coupon rate |
| Repayment |
Seven-year |
| In early June 2012 |
| NT$2,500 million |
| 1.63% |
| Interest will be paid annually and the principal will be repayable in June 2019 upon maturity. |
Five-year |
| In mid-March 2013 |
| NT$7,500 million |
| 1.35% |
| Interest will be paid annually and the principal has been fully repaid in mid-March 2018. |
Seven-year |
| In mid-March 2013 |
| NT$2,500 million |
| 1.50% |
| Interest will be paid annually and the principal will be repayable in March 2020 upon maturity. |
Seven-year |
| In mid-June 2014 |
| NT$2,000 million |
| 1.70% |
| Interest will be paid annually and the principal will be repayable in June 2021 upon maturity. |
Ten-year |
| In mid-June 2014 |
| NT$3,000 million |
| 1.95% |
| Interest will be paid annually and the principal will be repayable in June 2024 upon maturity. |
Five-year |
| In late March 2017 |
| NT$6,200 million |
| 1.15% |
| Interest will be paid annually and the principal will be repayable in March 2022 upon maturity. |
Seven-year |
| In late March 2017 |
| NT$2,100 million |
| 1.43% |
| Interest will be paid annually and the principal will be repayable in March 2024 upon maturity. |
Five-year |
| In early October 2017 |
| NT$2,000 million |
| 0.94% |
| Interest will be paid annually and the principal will be repayable in October 2022 upon maturity. |
Seven-year |
| In early October 2017 |
| NT$3,400 million |
| 1.13% |
| Interest will be paid annually and the principal will be repayable in October 2024 upon maturity. |
B. On May 18, 2015, UMC issued SGX-ST listed currency linked zero coupon convertible bonds. The terms and conditions of the bonds were 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 TWSE, 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 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: 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. The conversion price was NT$14.8157 per share onSeptember 30, 2018.
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%.
(15)Long-Term Loans
a. Details of long-term loans as of September 30, 2018, December 31, 2017 and September 30, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
| As of |
|
| ||||
Lenders |
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
| Redemption |
Secured Long-Term Loan from Mega International Commercial Bank (1) |
| $1,000 |
| $4,000 |
| $5,000 |
| 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 (2) |
| 6,560 |
| 8,200 |
| 8,746 |
| Effective July 3, 2017 to July 5, 2021. 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 (1) |
| - |
| 16,853 |
| 22,471 |
| 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. |
Secured Long-Term Loan from Taiwan Cooperative Bank (2) |
| 6,851 |
| 10,276 |
| 11,418 |
| 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 (3) |
| 9,368 |
| 13,382 |
| 14,721 |
| 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 Long-Term Loan from Taiwan Cooperative Bank (4) |
| $3,435 |
| $4,724 |
| $5,153 |
| Effective August 10, 2015 to August 10, 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) |
| 86,216 |
| 95,135 |
| 98,108 |
| Effective October 19, 2015 to October 19, 2025. Interest-only payment for the first year. Principal is repaid in 37 quarterly payments with monthly interest payments. |
Secured Long-Term Loan from Taiwan Cooperative Bank (6) |
| 1,033 |
| 1,476 |
| 1,624 |
| Effective October 28, 2015 to April 28, 2020. Interest-only payment for the first half year. Principal is repaid in 17 quarterly payments with monthly interest payments. |
Secured Long-Term Loan from Taiwan Cooperative Bank (7) |
| 3,123 |
| 4,165 |
| 4,512 |
| Effective November 20, 2015 to November 20, 2020. Interest-only payment for the first year. Principal is repaid in 17 quarterly payments with monthly interest payments. |
Secured Long-Term Loan from KGI Bank |
| 58,500 |
| - |
| - |
| Effective June 28, 2018 to February 23, 2023. Interest-only payment for the first year. Principal is repaid in 9 semi-annual payments with monthly interest payments. |
Unsecured Long-Term Loan from Bank of Taiwan |
| 300,000 |
| 300,000 |
| 300,000 |
| Repayable quarterly from March 23, 2019 to December 23, 2021 with monthly interest payments. |
Unsecured Syndicated Loans from Bank of Taiwan and 7 others |
| 747,900 |
| 1,246,500 |
| 1,246,500 |
| Repayable semi-annually from February 6, 2017 to February 6, 2020 with monthly interest payments. |
Unsecured Long-Term Loan from Mega International Commercial Bank |
| 118,589 |
| 474,356 |
| 592,945 |
| Repayable quarterly from October 4, 2015 to October 4, 2018 with monthly interest payments. |
Unsecured Long-Term Loan from E. Sun Bank |
| - |
| - |
| 55,555 |
| Repayable quarterly from December 24, 2015 to December 24, 2017 with monthly interest payments. |
Unsecured Long-Term Loan from Taiwan Cooperative Bank |
| - |
| - |
| 237,500 |
| Repayable quarterly from March 24, 2016 to December 24, 2017with monthly interest payments. |
Secured Syndicated Loans from China Development Bank and 6 others |
| 30,341,081 |
| 29,989,811 |
| 30,294,933 |
| Effective October 20, 2016 to October 20, 2024. Interest-only payment for the first and the second year. Principal is repaid in 13 semi-annual payments with semi-annual interest payments. |
Unsecured Revolving Loan from CTBC Bank(Note) |
| $- |
| $- |
| $2,500,000 |
| Settlement due on January 25, 2021 with monthly interest payments. |
Subtotal |
| 31,683,656 |
| 32,168,878 |
| 35,399,186 |
|
|
Less: Administrative expenses from syndicated loans |
| (2,266) |
| (3,542) |
| (3,967) |
|
|
Less: Current portion |
| (3,011,005) |
| (2,522,052) |
| (1,320,177) |
|
|
Total |
| $28,670,385 |
| $29,643,284 |
| $34,075,042 |
|
|
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Interest Rates |
| 0.99%~5.20% |
| 0.99%~4.66% |
Note: UMC entered into a 5-year loan agreement with CTBC Bank, effective from January 25, 2016. 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, January 25, 2021. As of September 30, 2018, December 31, 2017 and September 30, 2017, the unused line of credit were NT$2.5 billion, NT$2.5 billion and nil, respectively.
b. Please refer to Note 8 for property, plant and equipment pledged as collateral for long- term loans.
(16)Post-Employment Benefits
a. Defined contribution plan
The employee pension plan under the Labor Pension Act of the R.O.C. (the Act) is a defined contribution plan. Pursuant to the plan, UMC and its domestic subsidiaries make monthly contributions of 6% based on each individual employee’s salary or wage to employees’ pension accounts. Pension benefits for employees of the Singapore branch and subsidiaries overseas were provided in accordance with the local regulations. A total of NT$341 million, NT$324 million, NT$1,006 million and NT$938 million were contributed by the Company for the three-month and nine-month periods ended September 30, 2018 and 2017, 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 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 a pension fund supervisory committee. The pension fund is managed by the government’s designated authorities and therefore is not included in the Company’s consolidated financial statements. Pension cost for an interim period is calculated on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior financial year. For the three-month and nine-month periods ended September 30, 2018 and 2017, total pension expenses of NT$17 million, NT$20 million, NT$52 million and NT$60 million, respectively, were recognized by the Company.
(17)Deferred Government Grants
|
|
| ||||
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Beginning balance |
| $14,595,546 |
| $9,297,371 |
| $9,297,371 |
Arising during the period |
| 6,996,355 |
| 6,755,920 |
| 1,899,096 |
Recorded in profit or loss: |
|
|
|
|
|
|
Other operating income |
| (2,894,256) |
| (1,469,616) |
| (834,190) |
Exchange effect |
| (539,940) |
| 11,871 |
| (94,960) |
Ending balance |
| $18,157,705 |
| $14,595,546 |
| $10,267,317 |
|
|
|
|
|
|
|
Current |
| $3,833,287 |
| $2,821,467 |
| $1,936,696 |
Noncurrent |
| 14,324,418 |
| 11,774,079 |
| 8,330,621 |
Total |
| $18,157,705 |
| $14,595,546 |
| $10,267,317 |
The significant government grants related to equipment acquisitions received by the Company are amortized as income over the useful lives of related equipment, and recorded in the net other operating income and expenses.
(18)Refund Liabilities
|
| As of September 30, 2018 |
Refund liabilities |
| $1,233,259 |
Under IFRS 15, the Company’s allowance for sales returns and discounts are presented as refund liabilities as a component of other current liabilities, different from its prior presentation as a contra-account to accounts receivable.
(19)Equity
a. Capital stock:
i. UMC had 26,000 million common shares authorized to be issued as of September 30, 2018, December 31, 2017 and September 30, 2017, of which 12,424 million shares, 12,624 million shares and 12,624 million shares were issued as of September 30, 2018, December 31, 2017 and September 30, 2017, respectively, each at a par value of NT$10.
ii. UMC had 143 million, 144 million and 144 million ADSs, which were traded on the NYSE as of September 30, 2018, December 31, 2017 and September 30, 2017, respectively. The total number of common shares of UMC represented by all issued ADSs were 717 million shares, 721 million shares and 721 million shares as of September 30, 2018, December 31, 2017 and September 30, 2017, respectively. One ADS represents five common shares.
iii. On August 27, 2018, UMC cancelled 200 million shares of treasury stock, which were repurchased during the period from March 12 to May 4, 2018, for the purpose of maintaining UMC’s credit and stockholders’ rights and interests.
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 nine-month periods ended September 30, 2018 and 2017 are as follows:
For the nine-month period ended September 30, 2018
(In thousands of shares)
Purpose |
| As of January 1, 2018 |
|
Increase |
|
Decrease |
| As of September 30, 2018 |
For transfer to employees |
| 400,000 |
| - |
| 200,000 |
| 200,000 |
To maintain UMC’s credit and stockholders’ rights and interests |
| - |
| 200,000 |
| 200,000 |
| - |
|
| 400,000 |
| 200,000 |
| 400,000 |
| 200,000 |
For the nine-month period ended September 30, 2017
(In thousands of shares)
Purpose |
| As of January 1, 2017 |
|
Increase |
|
Decrease |
| As of September 30, 2017 |
For transfer toemployees |
| 400,000 |
| - |
| - |
| 400,000 |
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 number of shares of treasury stock that UMC held as of September 30, 2018, December 31, 2017 and September 30, 2017, did not exceed the limit.
iii. In compliance with Securities and Exchange Law of the R.O.C., treasury stock held by the parent company 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 September 30, 2018, December 31, 2017 and September 30, 2017, UMC’s subsidiary, FORTUNE VENTURE CAPITAL CORP., held 16 million shares of UMC’s stock. The closing price on September 30, 2018, December 31, 2017 and September 30, 2017, were NT$16.15, NT$14.20 and NT$15.00, 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’s 5 in 1 merger.
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 taxes.
ii. Making up loss for preceding years.
iii. Setting aside 10% for legal reserve, except for when accumulated legal reserve has reached UMC’s paid-in capital.
iv. Appropriating or reversing special reserve by government officials or other regulations.
v. The remaining, plus the previous year’s unappropriated earnings, shall be distributed according to the distribution plan proposed by the Board of Directors according to the dividend policy and submitted to the stockholders’ meeting for approval.
Because UMC conducts business in a capital intensive industry and continues to operate in its growth phase, the dividend policy of UMC shall be determined pursuant to factors such as the investment environment, its funding requirements, domestic and overseas competitive landscape and its capital expenditure forecast, as well as stockholders’ interest, balancing dividends and UMC’s long-term financial planning. The Board of Directors shall propose the distribution plan and submit it to the stockholders’ meeting every year. The distribution of stockholders’ dividend shall be allocated as cash dividend in the range of 20% to 100%, and stock dividend in the range of 0% to 80%.
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 debit balance of exchange differences on translation of foreign operations, 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 deficits.
The distribution of earnings for 2017 and 2016 was approved by the stockholders’ meeting held on June 12, 2018 and June 8, 2017, respectively. The details of distribution are as follows:
|
| Appropriation of earnings (in thousand NT dollars) |
| Cash dividend per share (NT dollars) | ||||
|
| 2017 |
| 2016 |
| 2017 |
| 2016 |
Legal reserve |
| $962,873 |
| $831,566 |
|
|
|
|
Cash dividends |
| 8,557,023 |
| 6,112,159 |
| $0.70 |
| $0.50 |
The aforementioned 2017 and 2016distributions approved by stockholders’ meeting were consistent with the resolutions of meeting of Board of Directors held onMarch 7, 2018 and February 22, 2017.
The cash dividend per share for 2017 was adjusted to NT$0.71164307 per share according to the resolution of the Board of Directors’ meeting on June 12, 2018. The adjustment was made for the decrease in outstanding common shares due to the share repurchase program.
Please refer to Note 6(22) for information on the employees’ compensation and remuneration to directors.
d. Non-controlling interests:
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Beginning balance |
| $956,808 |
| $2,161,729 |
Impact of retroactive applications |
| 1,597 |
| - |
Adjusted beginning balance |
| 958,405 |
| 2,161,729 |
Attributable to non-controlling interests: |
|
|
|
|
Net loss |
| (3,136,411) |
| (2,419,109) |
Other comprehensive income (loss) |
| (114,587) |
| (100,777) |
The differences between the fair value of the consideration paid or received from acquiring or disposing subsidiaries and the carrying amounts of the subsidiaries |
| - |
| (1,099,544) |
Changes in subsidiaries’ ownership |
| (279,907) |
| 171,159 |
Others |
| 3,065,741 |
| 2,332,135 |
Ending balance |
| $493,241 |
| $1,045,593 |
(20)Share-Based Payment
In order to attract, retain talents and reward the employees for their productivity and loyalty, the Company carried out a compensation plan to offer 200 million shares of treasury stock to employees in August 2018. The compensation cost of the shared-based payment is measured at the fair value based on the difference between the closing quoted market price of the shares at grant date and the cash received from employees. The closing quoted market price of the Company’s shares on the grant date was NT$16.95 per share. For the stocks vested on the date of grant, the Company recognizes the entire compensation cost on the grant date, while for the stocks with requisite service conditions to vest at the end of one or two-years from the date of grant, the Company recognizes the compensation cost on a straight-line basis over the period in which the services conditions are fulfilled, together with a corresponding increase in other capital reserves in equity. As such, for the three-month and nine-month periods ended September 30, 2018, total compensation expenses of NT$575 million and NT$575 million, respectively, were recognized by the Company.
(21)Operating Revenues
a. Disaggregation of revenue
i. By operating segments
|
| For the three-month period ended September 30, 2018 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Contract revenue from customers |
| $39,328,727 |
| $59,854 |
| $39,388,581 |
| $(1,925) |
| $39,386,656 |
|
|
|
|
|
|
|
|
|
|
|
The timing of revenue recognition: |
|
|
|
|
|
|
|
| ||
The revenue recognized at a point in time |
| $38,209,497 |
| $59,854 |
| $38,269,351 |
| $(1,925) |
| $38,267,426 |
The revenue recognized over time |
| 1,119,230 |
| - |
| 1,119,230 |
| - |
| 1,119,230 |
Total |
| $39,328,727 |
| $59,854 |
| $39,388,581 |
| $(1,925) |
| $39,386,656 |
|
| For the nine-month period ended September 30, 2018 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Contract revenue from customers |
| $115,532,965 |
| $218,559 |
| $115,751,524 |
| $(16,154) |
| $115,735,370 |
|
|
|
|
|
|
|
|
|
|
|
The timing of revenue recognition: |
|
|
|
|
|
|
|
| ||
The revenue recognized at a point in time |
| $111,322,363 |
| $218,559 |
| $111,540,922 |
| $(16,154) |
| $111,524,768 |
The revenue recognized over time |
| 4,210,602 |
| - |
| 4,210,602 |
| - |
| 4,210,602 |
Total |
| $115,532,965 |
| $218,559 |
| $115,751,524 |
| $(16,154) |
| $115,735,370 |
ii. By geography
|
| For the three-month period ended September 30, 2018 | ||||||||||||||
|
| Taiwan |
| Singapore |
| China (includes Hong Kong) |
| Japan |
| USA |
| Europe |
| Others |
| Total |
Contract revenue from customers |
| $14,688,146 |
| $5,805,252 |
| $4,823,514 |
| $1,620,403 |
| $5,546,143 |
| $4,039,275 |
| $2,863,923 |
| $39,386,656 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The timing of revenue recognition: |
|
|
|
|
|
|
|
|
|
|
|
| ||||
The revenue recognized at a point in time |
| $14,676,677 |
| $5,790,666 |
| $4,014,927 |
| $1,619,431 |
| $5,541,445 |
| $3,761,372 |
| $2,862,908 |
| $38,267,426 |
The revenue recognized over time |
| 11,469 |
| 14,586 |
| 808,587 |
| 972 |
| 4,698 |
| 277,903 |
| 1,015 |
| 1,119,230 |
Total |
| $14,688,146 |
| $5,805,252 |
| $4,823,514 |
| $1,620,403 |
| $5,546,143 |
| $4,039,275 |
| $2,863,923 |
| $39,386,656 |
|
| For the nine-month period ended September 30, 2018 | ||||||||||||||
|
| Taiwan |
| Singapore |
| China (includes Hong Kong) |
| Japan |
| USA |
| Europe |
| Others |
| Total |
Contract revenue from customers |
| $41,321,445 |
| $19,457,272 |
| $15,036,171 |
| $3,989,963 |
| $17,342,917 |
| $10,330,463 |
| $8,257,139 |
| $115,735,370 |
The timing of revenue recognition: |
|
|
|
|
|
|
|
|
|
|
|
| ||||
The revenue recognized at a point in time |
| $41,198,069 |
| $19,431,391 |
| $11,705,571 |
| $3,984,890 |
| $17,325,302 |
| $9,624,165 |
| $8,255,380 |
| $111,524,768 |
The revenue recognized over time |
| 123,376 |
| 25,881 |
| 3,330,600 |
| 5,073 |
| 17,615 |
| 706,298 |
| 1,759 |
| 4,210,602 |
Total |
| $41,321,445 |
| $19,457,272 |
| $15,036,171 |
| $3,989,963 |
| $17,342,917 |
| $10,330,463 |
| $8,257,139 |
| $115,735,370 |
|
| For the three-month period ended September 30, |
| For the nine-month period ended September 30, |
|
| 2017 |
| 2017 |
Net sales |
|
|
|
|
Sale of goods |
| $36,406,227 |
| $108,463,094 |
Other operating revenues |
|
|
|
|
Royalty |
| 3,894 |
| 6,817 |
Mask tooling |
| 692,926 |
| 2,432,298 |
Others |
| 595,154 |
| 1,751,823 |
Net operating revenues |
| $37,698,201 |
| $112,654,032 |
Note: The Company adopted IFRS 15 on January 1, 2018. The Company elected not to restate prior periods in accordance with the transition provision in IFRS 15.
b. Contract balances
i. Contract assets, current
|
| As of |
|
| |||
|
| September 30, 2018 |
| January 1, 2018 |
| Differences | |
Sales of goods and services |
| $338,096 |
| $129,042 |
| $209,054 | |
As ofSeptember 30, 2018, the Company has an unconditional right to receive the consideration in the contract of to NT$126 million and transferred to accounts receivables at the reporting date.
ii. Contract liabilities, current
|
| As of |
|
| |||
|
| September 30, 2018 |
| January 1, 2018 |
| Differences | |
Sales of goods and services |
| $1,978,822 |
| $3,951,414 |
| $(1,972,592) | |
As ofSeptember 30, 2018, NT$3,697 million included in the current contract liability balance at the beginning of the period was recognized as revenue during the period.
c. The Company’s transaction price allocated to unsatisfied performance obligations amounted to NT$3,288 million as ofSeptember 30, 2018, which will be recognized as revenue no later than 2020. An estimate of the transaction price would not include any estimated amounts of variable consideration that are constrained.
d. Asset recognized from the cost to fulfil a contract with customer
As ofSeptember 30, 2018, the Company recognized the cost to fulfil a non-recurring engineering contract and cost for joint technology development that are eligible for capitalization as assets amounted to NT$387 million.
(22)Operating Costs and Expenses
The Company’s employee benefit, depreciation and amortization expenses are summarized as follows:
|
| For the three-month periods endedSeptember 30, | ||||||||||
|
| 2018 |
| 2017 | ||||||||
|
| Operating costs |
| Operating expenses |
| Total |
| Operating costs |
| Operating expenses |
| Total |
Employee benefit expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Salaries |
| $4,662,541 |
| $2,171,653 |
| $6,834,194 |
| $4,170,336 |
| $1,726,044 |
| $5,896,380 |
Labor and healthinsurance |
| 238,079 |
| 110,657 |
| 348,736 |
| 225,703 |
| 97,456 |
| 323,159 |
Pension |
| 271,624 |
| 86,907 |
| 358,531 |
| 259,410 |
| 84,627 |
| 344,037 |
Other employee benefit expenses |
| 72,214 |
| 23,594 |
| 95,808 |
| 70,372 |
| 28,251 |
| 98,623 |
Depreciation |
| 11,740,362 |
| 683,438 |
| 12,423,800 |
| 12,139,551 |
| 810,056 |
| 12,949,607 |
Amortization |
| 250,324 |
| 252,733 |
| 503,057 |
| 232,687 |
| 265,596 |
| 498,283 |
|
| For the nine-month periods endedSeptember 30, | ||||||||||
|
| 2018 |
| 2017 | ||||||||
|
| Operating costs |
| Operating expenses |
| Total |
| Operating costs |
| Operating expenses |
| Total |
Employee benefit expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Salaries |
| $13,325,703 |
| $5,553,092 |
| $18,878,795 |
| $12,335,317 |
| $5,195,822 |
| $17,531,139 |
Labor and healthinsurance |
| 681,075 |
| 282,200 |
| 963,275 |
| 668,990 |
| 291,637 |
| 960,627 |
Pension |
| 806,335 |
| 251,234 |
| 1,057,569 |
| 752,205 |
| 245,298 |
| 997,503 |
Other employee benefit expenses |
| 205,261 |
| 66,798 |
| 272,059 |
| 176,904 |
| 69,366 |
| 246,270 |
Depreciation |
| 35,952,147 |
| 1,978,729 |
| 37,930,876 |
| 35,790,644 |
| 2,375,089 |
| 38,165,733 |
Amortization |
| 650,457 |
| 927,955 |
| 1,578,412 |
| 683,710 |
| 921,551 |
| 1,605,261 |
According to UMC’s Articles of Incorporation, the employees’ compensation and directors’ remuneration shall be distributed in the following order:
UMC shall allocate no less than 5% of profit as employees’ compensation and no more than 0.1% of profit as directors’ compensation for each profitable fiscal year after offsetting any cumulative losses. The aforementioned employees’ compensation will be distributed in shares or cash. The employees of UMC’s subsidiaries who fulfill specific requirements stipulated by the Board of Directors may be granted such compensation. Directors may only receive compensation in cash. UMC may, by a resolution adopted by a majority vote at a meeting of the Board of Directors attended by two-thirds of the total number of directors, distribute the aforementioned employees’ and director’s compensation and report to the stockholders’ meeting for such distribution.
The Company estimates the amounts of the employees’ compensation and remuneration to directors and recognizes them in the profit or loss during the periods when earned for the nine-month periods ended September 30, 2018 and 2017. The Board of Directors estimated the amount by taking into consideration the Articles of Incorporation, government regulations and industry averages. If the Board of Directors resolves to distribute employee compensation through stock, the number of stock distributed is calculated based on total employee compensation divided by the closing price of the day before the Board of Directors meeting. If the Board of Directors subsequently modifies the estimates significantly, the Company will recognize the change as an adjustment in the profit or loss in the subsequent period. The difference between the estimation and the resolution of the stockholders’ meeting will be recognized in profit or loss in the subsequent year.
The distributions of employees’ compensation and remuneration to directors for 2017 and 2016 were reported to the stockholders’ meeting on June 12, 2018 and June 8, 2017, respectively. The details of distribution are as follows:
|
| 2017 |
| 2016 |
Employees’ compensation – Cash |
| $1,032,324 |
| $930,551 |
Directors’ remuneration |
| 11,452 |
| 9,714 |
The aforementioned 2017 and 2016 employees’ compensation and remuneration to directors reported during the stockholders’ meeting were consistent with the resolutions of meeting of Board of Directorsheld on March 7, 2018 andFebruary 22, 2017.
Information relevant to the aforementioned employees’ compensation and remuneration to directors can be obtained from the “Market Observation Post System” on the website of the TWSE.
(23)Net Other Operating Income and Expenses
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Net rental loss from property |
| $(49,583) |
| $(48,202) |
Gain on disposal of property, plant and equipment |
| 41,040 |
| 30,909 |
Government grants |
| 1,295,565 |
| 453,281 |
Others |
| (71,970) |
| 4,412 |
Total |
| $1,215,052 |
| $440,400 |
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Net rental loss from property |
| $(131,954) |
| $(117,229) |
Gain on disposal of property, plant and equipment |
| 125,126 |
| 49,229 |
Government grants |
| 3,977,189 |
| 886,661 |
Others |
| (59,629) |
| 34,315 |
Total |
| $3,910,732 |
| $852,976 |
(24)Non-Operating Income and Expenses
a. Other gains and losses
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Gain (loss)on valuation of financial assets and liabilities at fair value through profit or loss |
| $(797,076) |
| $133,023 |
Impairment loss on financial assets |
|
|
|
|
Available-for-sale financial assets, noncurrent |
| - |
| (167,411) |
Financial assets measured at cost, noncurrent |
| - |
| (132,344) |
Gain ondisposal of investments |
| - |
| 537,966 |
Others |
| 26,435 |
| 28,396 |
Total |
| $(770,641) |
| $399,630 |
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Gain (loss) on valuation of financial assets and liabilities at fair value through profit or loss |
| $(532,756) |
| $512,638 |
Impairment loss on financial assets |
|
|
|
|
Available-for-sale financial assets, noncurrent |
| - |
| (563,532) |
Financial assets measured at cost, noncurrent |
| - |
| (132,344) |
Gainon disposal of investments |
| 12,570 |
| 1,298,553 |
Others |
| 94,832 |
| 63,312 |
Total |
| $(425,354) |
| $1,178,627 |
b. Finance costs
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Interest expenses |
|
|
|
|
Bonds payable |
| $172,692 |
| $181,699 |
Bank loans |
| 452,424 |
| 412,872 |
Others |
| 72,126 |
| 36,165 |
Financial expenses |
| 38,774 |
| 30,273 |
Total |
| $736,016 |
| $661,009 |
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Interest expenses |
|
|
|
|
Bonds payable |
| $537,535 |
| $566,781 |
Bank loans |
| 1,324,250 |
| 1,135,136 |
Others |
| 214,477 |
| 36,273 |
Financial expenses |
| 67,848 |
| 74,405 |
Total |
| $2,144,110 |
| $1,812,595 |
(25)Components of Other Comprehensive Income (Loss)
|
|
| ||||||||
|
| For the three-month period ended September 30, 2018 | ||||||||
|
| 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 will not be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
|
|
Unrealized gains or losses on financial assets at fair value through other comprehensive income |
| $356,337 |
| $- |
| $356,337 |
| $(2,054) |
| $354,283 |
Gains or losses on hedging instruments which will not be reclassified subsequently to profit or loss |
| (64,315) |
| - |
| (64,315) |
| 12,863 |
| (51,452) |
Share of other comprehensive income (loss) of associates and joint ventures which will not be reclassified subsequently to profit or loss |
| (254,124) |
| - |
| (254,124) |
| 39,741 |
| (214,383) |
Items that may be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
|
|
Exchange differences on translation of foreign operations |
| (1,646,056) |
| - |
| (1,646,056) |
| (326) |
| (1,646,382) |
Share of other comprehensive income (loss) of associates and joint ventures which may be reclassified subsequently to profit or loss |
| (9,232) |
| - |
| (9,232) |
| (267) |
| (9,499) |
Total other comprehensive income (loss) |
| $(1,617,390) |
| $- |
| $(1,617,390) |
| $49,957 |
| $(1,567,433) |
|
| For the three-month period ended September 30, 2017 | ||||||||
|
| 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 |
| $49,496 |
| $- |
| $49,496 |
| $2,042 |
| $51,538 |
Unrealized gain (loss) on available-for-sale financial assets |
| (948,288) |
| (296,848) |
| (1,245,136) |
| (5,314) |
| (1,250,450) |
Share of other comprehensive income (loss) of associates and joint ventures which may be reclassified subsequently to profit or loss |
| 146,878 |
| (8,509) |
| 138,369 |
| (7,383) |
| 130,986 |
Total other comprehensive income (loss) |
| $(751,914) |
| $(305,357) |
| $(1,057,271) |
| $(10,655) |
| $(1,067,926) |
|
|
| ||||||||
|
| For the nine-month period ended September 30, 2018 | ||||||||
|
| 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 will not be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
|
|
Remeasurement of defined-benefit plan |
| $- |
| $- |
| $- |
| $21,635 |
| $21,635 |
Unrealized gains or losses on financial assets at fair value through other comprehensive income |
| 1,591,531 |
| - |
| 1,591,531 |
| 21,241 |
| 1,612,772 |
Gains or losses on hedging instruments which will not be reclassified subsequently to profit or loss |
| (64,315) |
| - |
| (64,315) |
| 12,863 |
| (51,452) |
Share of other comprehensive income (loss) of associates and joint ventures which will not be reclassified subsequently to profit or loss |
| (123,975) |
| - |
| (123,975) |
| 34,697 |
| (89,278) |
Items that may be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
|
|
Exchange differences on translation of foreign operations |
| $(643,836) |
| $408 |
| $(643,428) |
| $(13,970) |
| $(657,398) |
Share of other comprehensive income (loss) of associates and joint ventures which may be reclassified subsequently to profit or loss |
| 17,262 |
| (12,897) |
| 4,365 |
| (448) |
| 3,917 |
Total other comprehensive income (loss) |
| $776,667 |
| $(12,489) |
| $764,178 |
| $76,018 |
| $840,196 |
|
|
| ||||||||
|
| For the nine-month period ended September 30, 2017 | ||||||||
|
| 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 |
| $(4,883,304) |
| $- |
| $(4,883,304) |
| $38,860 |
| $(4,844,444) |
Unrealized gain (loss) on available-for-sale financial assets |
| 1,380,406 |
| (555,573) |
| 824,833 |
| 19,495 |
| 844,328 |
Share of other comprehensive income (loss) of associates and joint ventures which maybe reclassified subsequently to profit or loss |
| 1,266,637 |
| 102,265 |
| 1,368,902 |
| (37,502) |
| 1,331,400 |
Total other comprehensive income (loss) |
| $(2,236,261) |
| $(453,308) |
| $(2,689,569) |
| $20,853 |
| $(2,668,716) |
(26)Income Tax
a. The major components of income tax expense for the three-month and nine-month periods ended September 30, 2018 and 2017 were as follows:
i. Income tax expense recorded in profit or loss
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Current income tax expense (benefit): |
|
|
|
|
Current income tax charge |
| $247,282 |
| $409,678 |
Adjustments in respect of current income tax of prior periods |
| 1,965 |
| - |
Deferred income tax expense (benefit): |
|
|
|
|
Deferred income tax related to origination and reversal of temporary differences |
| 213,723 |
| (69,103) |
Deferred income tax related to recognition andderecognition of tax losses and unused tax credits |
| (571,189) |
| 35,116 |
Deferred income tax arising from write-down or reversal of write-down of deferred tax assets |
| 739,884 |
| 25,857 |
Income tax benefit recorded in profit or loss |
| $631,665 |
| $401,548 |
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Current income tax expense (benefit): |
|
|
|
|
Current income tax charge |
| $456,498 |
| $2,218,331 |
Adjustments in respect of current income tax of prior periods |
| (1,115,637) |
| (365,241) |
Deferred income tax expense (benefit): |
|
|
|
|
Deferred income tax related to origination and reversal of temporary differences |
| 1,335,101 |
| (1,276,841) |
Deferred income tax related to recognition andderecognition of tax losses and unused tax credits |
| (2,581,674) |
| (71,179) |
Deferred income tax related to changes in tax rates |
| (848,223) |
| - |
Adjustment of prior year’s deferred income tax |
| (2,820) |
| 9,093 |
Deferred income tax arising from write-down or reversal of write-down of deferred tax assets |
| 1,884,733 |
| 96,526 |
Income tax benefit recorded in profit or loss |
| $(872,022) |
| $610,689 |
ii. Income tax related to components of other comprehensive income (loss)
Items that will not be reclassified subsequently to profit or loss:
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Unrealized gains or losses on financial assets at fair value through other comprehensive income |
| $(2,054) |
| $- |
Gains or losses on hedging instruments which will not be reclassified subsequently to profit or loss |
| 12,863 |
| - |
Share of other comprehensive income (loss) of associates and joint ventures which will not be reclassified subsequently to profit or loss |
| 39,741 |
| - |
Incometax related to items that will not be reclassified subsequently to profit or loss |
| $50,550 |
| $- |
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Unrealizedgains or losses on financial assets at fair value through other comprehensive income |
| $8,714 |
| $- |
Gains or losses on hedging instruments which will not be reclassified subsequently to profit or loss |
| 12,863 |
| - |
Share of other comprehensive income (loss) of associates and joint ventures which will not be reclassified subsequently to profit or loss |
| 39,741 |
| - |
Deferred income tax related to changes in tax rates |
| 29,118 |
| - |
Income tax related to items that will not be reclassified subsequently to profit or loss |
| $90,436 |
| $- |
Items that may be reclassified subsequently to profit or loss:
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Exchange differences on translation of foreign operations |
| $(326) |
| $2,042 |
Unrealized loss (gain) on available-for-sale financial assets |
| - |
| (5,314) |
Share of other comprehensive income (loss) of associates and joint ventures which may be reclassified subsequently to profit or loss |
| (267) |
| (7,383) |
Income tax related to items that may be reclassified subsequently |
| $(593) |
| $(10,655) |
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Exchange differences on translation of foreign operations |
| $(16,758) |
| $38,860 |
Unrealized loss (gain) on available-for-sale financial assets |
| - |
| 19,495 |
Share of other comprehensive income (loss) of associates and joint ventures which may be reclassified subsequently to profit or loss |
| (4,895) |
| (37,502) |
Deferred income tax related to changes in tax rates |
| 7,235 |
| - |
Income tax related to items that may be reclassified subsequently |
| $(14,418) |
| $20,853 |
iii. Deferred income tax charged directly to equity
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Adjustments of changes in net assets of associates and joint ventures accounted for using equity method |
| $- |
| $(2) |
Deferred income tax related to changes in tax rates |
| - |
| - |
Total |
| $- |
| $(2) |
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Adjustments of changes in net assets of associates and joint ventures accounted for using equity method |
| $- |
| $(2) |
Deferred income tax related to changes in tax rates |
| (56,759) |
| - |
Total |
| $(56,759) |
| $(2) |
b. The Company is subject to taxation in Taiwan and other foreign jurisdictions. As of September 30, 2018, income tax returns of UMC and its subsidiaries in Taiwan have been examined by the tax authorities through 2014, while in other foreign jurisdictions, relevant tax authorities have completed the examination through 2010.
c. According to the amendments to the R.O.C. Income Tax Act, effective from 2018, the corporate income tax rate is raised from 17% to 20%, and the 10% undistributed earnings tax is lowered to 5%.
(27)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 company by the weighted-average number of ordinary shares outstanding during the year. The reciprocal stockholdings held by subsidiaries are deducted from the computation of weighted-average number of shares outstanding.
|
| For the three-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Net income attributable to the parent company |
| $1,720,426 |
| $3,472,656 |
Weighted-average number of ordinary shares for basic earnings per share (thousand shares) |
| 12,053,892 |
| 12,208,240 |
Earnings per share-basic (NTD) |
| $0.14 |
| $0.28 |
|
| For the nine-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Net income attributable to the parent company |
| $8,779,603 |
| $7,857,683 |
Weighted-average number of ordinary shares for basic earnings per share (thousand shares) |
| 12,101,201 |
| 12,208,240 |
Earnings per share-basic (NTD) |
| $0.73 |
| $0.64 |
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 company would be also adjusted for the interest and other income or expenses derived from any underlying dilutive share equivalents, such as convertible bonds. For employees’ compensation 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.
|
| For the three-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Netincome attributable to the parent company |
| $1,720,426 |
| $3,472,656 |
Effectof dilution |
|
|
|
|
Unsecured convertible bonds |
| 71,021 |
| 72,208 |
Income attributable to stockholders of the parent |
| $1,791,447 |
| $3,544,864 |
Weighted-average number of common stocks for basic earnings per share (thousand shares) |
| 12,053,892 |
| 12,208,240 |
Effectof dilution |
|
|
|
|
Employees’ compensation |
| 57,464 |
| 39,013 |
Unsecured convertible bonds |
| 1,243,600 |
| 1,193,935 |
Weighted-average number of common stocks after dilution (thousand shares) |
| 13,354,956 |
| 13,441,188 |
|
|
|
|
|
Dilutedearnings per share (NTD) |
| $0.13 |
| $0.26 |
|
| For the nine-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Net income attributable to the parent company |
| $8,779,603 |
| $7,857,683 |
Effect ofdilution |
|
|
|
|
Unsecured convertible bonds |
| 211,979 |
| 215,526 |
Incomeattributable to stockholders of the parent |
| $8,991,582 |
| $8,073,209 |
Weighted-average number of common stocks for basic earnings per share (thousand shares) |
| 12,101,201 |
| 12,208,240 |
Effect ofdilution |
|
|
|
|
Employees’ compensation |
| 74,835 |
| 54,098 |
Unsecured convertible bonds |
| 1,243,600 |
| 1,193,935 |
Weighted-average number of common stocks after dilution (thousand shares) |
| 13,419,636 |
| 13,456,273 |
|
|
|
|
|
Dilutedearnings per share (NTD) |
| $0.67 |
| $0.60 |
(28)Reconciliation of Liabilities Arising from Financing Activities
For the nine-month period ended September 30, 2018:
|
|
|
|
|
| Non-cash changes |
|
| ||
Items |
| As of January 1, 2018 |
| Cash Flows |
| Foreign exchange |
| Others (Note) |
| As of September 30, 2018 |
Short-term loans |
| $25,445,540 |
| $(10,469,203) |
| $(370,226) |
| $211,693 |
| $14,817,804 |
Long-term loans (current portion included) |
| 32,165,336 |
| (836,491) |
| 351,270 |
| 1,275 |
| 31,681,390 |
Bonds payable (current portion included) |
| 48,517,631 |
| (7,500,000) |
| - |
| 269,747 |
| 41,287,378 |
Guarantee deposits (current portion included) |
| 564,576 |
| (69,201) |
| 25,421 |
| - |
| 520,796 |
Other financial liabilities-noncurrent |
| 20,486,119 |
| - |
| (610,627) |
| 287,052 |
| 20,162,544 |
Note: Other non-cash changes mainly consisted of amortization of short-term loans, bonds payable and other financial liabilities-noncurrent using the EIR method.
For the nine-month period ended September 30, 2017: Not applicable.
7. RELATED PARTY TRANSACTIONS
The following is a summary of transactions between the Company and related parties during the financial reporting periods:
(1) Name and Relationship of Related Parties
Name of related parties |
| Relationship with the Company |
FARADAY TECHNOLOGY CORP. and its Subsidiaries |
| Associate |
JINING SUNRICH SOLARENERGY CORPORATION |
| Joint venture’s subsidiary |
SILICON INTEGRATED SYSTEMS CORP. |
| The Company’s director |
SUBTRON TECHNOLOGY CO., LTD. |
| Subsidiary’s supervisor |
PHOTRONICS DNP MASK CORPORATION |
| Other related parties |
TRIKNIGHT CAPITAL CORPORATION |
| Associate |
(2) Significant related party transactions
a. Operating transactions
Operating revenues
|
| For the three-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Associates |
| $484,916 |
| $304,010 |
Joint ventures |
| 13 |
| 3,118 |
Others |
| 11,390 |
| 5,129 |
Total |
| $496,319 |
| $312,257 |
|
| For the nine-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Associates |
| $990,056 |
| $1,136,946 |
Joint ventures |
| 4,290 |
| 9,307 |
Others |
| 20,488 |
| 17,667 |
Total |
| $1,014,834 |
| $1,163,920 |
Accounts receivable, net
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Associates |
| $324,322 |
| $84,839 |
| $198,780 |
Joint ventures |
| - |
| 1,051 |
| 1,021 |
Others |
| 10,276 |
| 7,908 |
| 4,003 |
Total |
| 334,598 |
| 93,798 |
| 203,804 |
Less: Allowance for sales returns and discounts |
| - |
| (2,733) |
| (3,531) |
Net |
| $334,598 |
| $91,065 |
| $200,273 |
The sales price to the above related parties was determined through mutual agreement in reference to market conditions. The collection periods for domestic sales to related parties were month-end 30~60 days, while the collection periods for overseas sales was net 30~60 days.
Refund liabilities (within current liabilities-others)
|
| As of September 30, 2018 |
Associates |
| $1,218 |
Others |
| 61 |
Total |
| $1,279 |
b. Significant asset transactions
Acquisition of intangible assets
|
| Purchase price | ||
|
| For the three-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Associates |
| $24,628 |
| $69,321 |
|
| Purchase price | ||
|
| For the nine-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Associates |
| $131,630 |
| $242,260 |
Acquisition of investments accounted for under the equity method
|
| Trading Volume (In thousands of shares) |
| Transaction underlying |
| Purchase price |
|
|
|
| For the three-month periods ended September 30, 2018 | ||
Associates |
| - |
| None |
| $- |
|
| Trading Volume (In thousands of shares) |
| Transaction underlying |
| Purchase price |
|
|
|
| For the nine-month periods ended September 30, 2018 | ||
Associates |
| 84,000 |
| Stock |
| $840,000 |
For the three-month and nine-month periods ended September 30, 2017: None.
Disposal of financial assets
For the three-month and nine-month periods ended September 30, 2018: None.
|
|
|
|
|
| For the three-month period ended September 30, 2017 | ||
|
| Trading Volume (In thousands of shares) |
| Transaction underlying |
| Disposal amount |
| Disposal (loss) gain |
Others |
| - |
| None |
| $- |
| $- |
|
|
|
|
|
| For the nine-month period ended September 30, 2017 | ||
|
| Trading Volume (In thousands of shares) |
| Transaction underlying |
| Disposal amount |
| Disposal (loss) gain |
Others |
| 6,489 |
| ASIA PACIFICMICROSYSTEMS, INC. |
| $50,745 |
| $(13,753) |
c. Others
Mask expenditure
|
| For the three-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Others |
| $408,590 |
| $382,786 |
|
| For the nine-month periods ended September 30, | ||
|
| 2018 |
| 2017 |
Others |
| $1,242,619 |
| $495,510 |
Other payables of mask expenditure
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Others |
| $536,398 |
| $580,789 |
| $461,860 |
d. Key management personnel compensation
|
| For the three-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Short-term employee benefits |
| $196,162 |
| $104,868 |
Post-employment benefits |
| 2,494 |
| 728 |
Termination benefits |
| - |
| 6,957 |
Share-based payment |
| 272,542 |
| 17 |
Others |
| 148 |
| 68 |
Total |
| $471,346 |
| $112,638 |
|
| For the nine-month periods endedSeptember 30, | ||
|
| 2018 |
| 2017 |
Short-term employee benefits |
| $335,034 |
| $263,399 |
Post-employment benefits |
| 3,937 |
| 2,593 |
Termination benefits |
| - |
| 6,957 |
Share-based payment |
| 272,575 |
| 52 |
Others |
| 288 |
| 227 |
Total |
| $611,834 |
| $273,228 |
8. ASSETS PLEDGED AS COLLATERAL
As of September 30, 2018, December 31, 2017 and September 30, 2017
|
|
|
|
|
|
| ||||
|
| Amount |
|
|
|
| ||||
|
| As of |
|
|
|
| ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
| Party to which asset(s) was pledged |
| Purpose of pledge |
Refundable Deposits (Bank deposit and Time deposit) |
| $960,042 |
| $972,827 |
| $1,145,933 |
| Customs |
| Customs duty guarantee |
Refundable Deposits (Time deposit) |
| 237,358 |
| 246,008 |
| 257,075 |
| Science Park Administration |
| Collateral for land lease |
Refundable Deposits (Time deposit) |
| 19,579 |
| 20,991 |
| - |
| Science Park Administration |
| Collateral for dormitory lease |
Refundable Deposits (Time deposit) |
| 800 |
| 800 |
| - |
| Science Park Administration |
| Industry-university cooperative research project performance guarantees |
Refundable Deposits (Time deposit) |
| $37,084 |
| $37,084 |
| $37,084 |
| Liquefied Natural Gas Business Division, CPC Corporation, Taiwan |
| Energy resources guarantee |
Refundable Deposits (Time deposit) |
| 1,000,000 |
| - |
| - |
| Bank of China |
| Bank performance guarantee |
Buildings |
| 5,849,150 |
| 6,083,976 |
| 5,649,678 |
| Taiwan Cooperative Bank and Secured Syndicated Loans from China Development Bank and 6 others |
| Collateral for long-term loans |
Machinery and equipment |
| 27,142,213 |
| 32,428,768 |
| 33,881,009 |
| Taiwan Cooperative Bank, Mega International Commercial Bank andSecured Syndicated Loans from China Development Bank and 6 others |
| Collateral for long-term loans |
Other noncurrent assets |
| 308,412 |
| 323,001 |
| 323,933 |
| Secured Syndicated Loans from China Development Bank and 6 others |
| Collateral for long-term loans |
Total |
| $35,554,638 |
| $40,113,455 |
| $41,294,712 |
|
|
|
|
9. SIGNIFICANT CONTINGENCIES AND UNRECOGNIZED CONTRACT COMMITMENTS
(1) As of September 30, 2018, amounts available under unused letters of credit for importing machinery and equipment was NT$0.5 billion.
(2) As of September 30, 2018,the Company entrust financial institutes to open performance guaranteeamounted toNT$1.6 billion.
(3) The Company entered into several patent license agreements and development contracts of intellectual property for a total contract amount of approximately NT$11.8 billion. As of September 30, 2018, the portion of royalties and development fees not yet recognized was NT$0.9 billion.
(4) The Company entered into several construction contracts for the expansion of its operations. As of September 30, 2018, these construction contracts amounted to approximately NT$2.8 billion and the portion of the contracts not yet recognized was approximately NT$0.8 billion.
(5) The Company entered into several operating lease contracts for land and office. These renewable operating leases will expire in various years through 2038. Future minimum lease payments under those leases are as follows:
Year |
|
| As of September 30, 2018 |
2018 |
|
| $103,235 |
2019 |
|
| 375,492 |
2020 |
|
| 370,773 |
2021 |
|
| 357,377 |
2022 |
|
| 361,572 |
2023 and thereafter |
|
| 3,212,462 |
Total |
|
| $4,780,911 |
(6) The Board of Directors of UMC resolved in October 2014 to participate in a 3-way agreement with Xiamen Municipal People’s Government and FUJIAN ELECTRONIC & INFORMATION GROUP to form a company which will focus on 12’’ wafer foundry services. As of September 30, 2018, the Company obtained R.O.C. government authority’s approval for the investment and invested RMB 8.3 billion in USC, representing ownership interest of 65.22%. Furthermore, based on the agreement, UMC is committed to repurchase from the other investors’ investments in USC at their original investment cost plus interest, beginning from the seventh year following the last instalment payment made by the other investors. Accordingly, the Company recognizes non-controlling interests as required by IFRS 10 during the reporting period. At the end of each reporting period, the Company recognizes a financial liability for its commitment to the other investors in accordance with IFRS 9, at the same time derecognizing the non-controlling interests. Any difference between the financial liability and the non-controlling interests balance is recognized in equity.
(7) On July 1, 2016, INTERNATIONAL BUSINESS MACHINES CORPORATION (IBM) filed a complaint in the United States District Court for the Southern District of New York accusing that UMC did not pay the technology license fees in accordance with the technology license agreement and claimed US$10 million with interest of 12% per annum. UMC is appealing an unfavorable judgment issued on September 15, 2017 by the United States District Court of Southern District of New York for the subject matter. The Company does not expect material adverse financial impact resulting from this claim.
(8) In 2017, the Taichung District Prosecutors Office requested the local court to impose a fine to UMC based on the allegation of misappropriation of trade secret of MICRON TECHNOLOGY INC. (“MICRON”). In addition, MICRON filed a civil lawsuit against UMC with the District Court of Northern District of California for the similar cause. On January 12, 2018, UMC filed counterclaims against MICRON with the Fuzhou Intermediate People’s Court against, among others, MICRON (XI’AN) CO., LTD. and MICRON (SHANGHAI) TRADING CO. for patent infringement. On July 3, 2018, the Fuzhou Intermediate People’s Court issued a ruling against the aforementioned two defendant companies, ruling that the two defendants must immediately cease to manufacture, sell, and import products that infringe the patent rights of UMC. The lawsuit filed by UMC is still on trial.
10. SIGNIFICANT DISASTER LOSS
None.
11. SIGNIFICANT SUBSEQUENT EVENTS
None.
12. OTHERS
(1) Categories of financial instruments
|
| As of | ||||
Financial Assets |
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Non-derivative financial instruments |
|
|
|
|
|
|
Financial assets at fair value through profit or loss |
| $12,905,629 |
| $876,318 |
| $1,015,332 |
Financial assets at fair value through other comprehensive income |
| 11,722,990 |
| - |
| - |
Available-for-sale financial assets |
| - |
| 20,636,332 |
| 21,055,861 |
Financialassets measured at cost |
| - |
| 2,218,472 |
| 2,530,440 |
Financial assets measured at amortized cost |
|
|
|
|
|
|
Cash and cash equivalents (excludes cash on hand) |
| 81,513,592 |
| 81,670,212 |
| 69,934,218 |
Receivables |
| 26,883,480 |
| 22,149,072 |
| 23,631,871 |
Refundable deposits |
| 2,775,848 |
| 1,903,041 |
| 2,090,029 |
Other financial assets, current |
| 1,585,700 |
| 2,645,003 |
| 1,480,280 |
Subtotal |
| 112,758,620 |
| 108,367,328 |
| 97,136,398 |
Derivative financial instruments |
|
|
|
|
|
|
Financial assets at fair value through profit or loss |
| 25,376 |
| 31,605 |
| 2,146 |
Total |
| $137,412,615 |
| $132,130,055 |
| $121,740,177 |
|
| As of | ||||
FinancialLiabilities |
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Non-derivative financial instruments |
|
|
|
|
|
|
Financial liabilities measured at amortized cost |
|
|
|
|
|
|
Short-term loans |
| $14,817,804 |
| $25,445,540 |
| $22,669,606 |
Payables |
| 21,723,753 |
| 24,274,413 |
| 23,595,876 |
Guarantee deposits (current portion included) |
| 520,796 |
| 564,576 |
| 639,946 |
Bonds payable (current portion included) |
| 41,287,378 |
| 48,517,631 |
| 43,034,883 |
Long-term loans(current portion included) |
| 31,681,390 |
| 32,165,336 |
| 35,395,219 |
Other financial liabilities-noncurrent |
| 20,162,544 |
| 20,486,119 |
| 20,342,777 |
Subtotal |
| 130,193,665 |
| 151,453,615 |
| 145,678,307 |
Derivative financial instruments |
|
|
|
|
|
|
Financial liabilities at fair value through profit or loss |
| - |
| - |
| 22,361 |
Hedging financial liabilities |
| 64,315 |
| - |
| - |
Total |
| $130,257,980 |
| $151,453,615 |
| $145,700,668 |
(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, 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.
(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 manage 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. The Company designates certain forward currency contracts as cash flow hedges to hedge its exposure to foreign currency exchange risk associated with certain highly probable forecast transactions. On the basis of assessment, the Company expects that the value of forward currency exchange contracts and the value of the hedged transactions will changesystematically in opposite directions in foreign exchange rates. Hedge ineffectiveness in these hedging relationships mainly arises from the counterparties’ credit risk, impacting the fair value movements of the hedging instruments and hedged items. No other sources of ineffectiveness emerged from these hedging relationships. 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 nine-month periods ended September 30, 2018 and 2017 decrease/increase by NT$1,132 million and NT$230 million, respectively. When RMB strengthens/weakens against USD by 10%, the profit for the nine-month periods ended September 30, 2018 and 2017 increase/decrease by NT$2,855 million and NT$3,493 million, respectively. When NTD strengthens/weakens against JPY by 10%, the other comprehensive income for the nine-month periods ended September 30, 2018 and 2017 increase/decrease by NT$272 million and nil.
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(11), 6(14) and 6(15) for the range of interest rates 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 nine-month periods ended September 30, 2018 and 2017 to decrease/increase by NT$35 million and NT$44 million, respectively.
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 equity investments are classified as financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income, 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 of listed companies could increase/decrease the Company’s profit for the nine-month periods ended September 30, 2018 and 2017 by NT$204 million and NT$37 million, respectively. A change of 5% in the price of the aforementioned financial assets at fair value through other comprehensive income of listed companies could increase/decrease the Company’s other comprehensive income for the nine-month period ended September 30, 2018 by NT$400 million. A change of 5% in the price of the aforementioned available-for-sale financial instruments of listed companies could increase/decrease the Company’s other comprehensive income for the nine-month period ended September 30, 2017 by NT$505 million.
(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 September 30, 2018, December 31, 2017 and September 30, 2017, accounts receivable from the top ten customers represent 53%, 54% and 58% of the total accounts receivables of the Company, respectively. The credit concentration risk of other accounts receivables is insignificant.
(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 September 30, 2018 | ||||||||
|
| Less than 1 year |
| 2 to 3 years |
| 4 to 5 years |
| > 5 years |
| Total |
Non-derivative financial liabilities |
|
|
|
|
|
|
|
|
|
|
Short-term loans |
| $14,873,085 |
| $- |
| $- |
| $- |
| $14,873,085 |
Payables |
| 20,986,750 |
| - |
| - |
| 106,601 |
| 21,093,351 |
Guarantee deposits |
| 36,305 |
| 13,973 |
| 30,580 |
| 439,938 |
| 520,796 |
Bonds payable |
| 2,985,938 |
| 23,205,788 |
| 8,506,918 |
| 8,594,758 |
| 43,293,402 |
Long-term loans |
| 4,472,060 |
| 9,644,761 |
| 15,413,967 |
| 8,850,434 |
| 38,381,222 |
Other financial liabilities |
| 843 |
| - |
| 17,345,840 |
| 4,336,692 |
| 21,683,375 |
Total |
| $43,354,981 |
| $32,864,522 |
| $41,297,305 |
| $22,328,423 |
| $139,845,231 |
|
|
|
|
|
|
|
|
|
|
|
Derivative financialliabilities |
|
|
|
|
|
|
|
|
|
|
Hedginginstruments- Forward exchangecontracts |
|
|
|
|
|
|
|
|
|
|
Net settlement -outflow |
| $(64,315) |
| $- |
| $- |
| $- |
| $(64,315) |
|
|
|
|
|
|
|
|
|
|
|
|
| As of December 31, 2017 | ||||||||
|
| Less than 1 year |
| 2 to 3 years |
| 4 to 5 years |
| > 5 years |
| Total |
Non-derivativefinancial liabilities |
|
|
|
|
|
|
|
|
|
|
Short-term loans |
| $25,622,430 |
| $- |
| $- |
| $- |
| $25,622,430 |
Payables |
| 23,807,378 |
| - |
| - |
| 104,755 |
| 23,912,133 |
Guarantee deposits |
| 95,085 |
| 14,071 |
| 29,876 |
| 425,544 |
| 564,576 |
Bonds payable |
| 26,321,530 |
| 5,564,967 |
| 10,590,265 |
| 8,689,971 |
| 51,166,733 |
Long-term loans |
| 3,855,962 |
| 8,728,249 |
| 13,397,515 |
| 13,450,444 |
| 39,432,170 |
Other financial liabilities |
| - |
| - |
| 13,402,849 |
| 8,935,552 |
| 22,338,401 |
Total |
| $79,702,385 |
| $14,307,287 |
| $37,420,505 |
| $31,606,266 |
| $163,036,443 |
|
|
|
|
|
|
|
|
|
|
|
|
| As of September 30, 2017 | ||||||||
|
| Less than 1 year |
| 2 to 3 years |
| 4 to 5 years |
| > 5 years |
| Total |
Non-derivativefinancial liabilities |
|
|
|
|
|
|
|
|
|
|
Short-term loans |
| $22,861,569 |
| $- |
| $- |
| $- |
| $22,861,569 |
Payables |
| 22,932,397 |
| - |
| - |
| 106,758 |
| 23,039,155 |
Guarantee deposits |
| 172,385 |
| 13,989 |
| 30,350 |
| 423,222 |
| 639,946 |
Bonds payable |
| 26,182,293 |
| 5,470,089 |
| 8,506,749 |
| 5,244,661 |
| 45,403,792 |
Long-term loans |
| 2,671,823 |
| 8,665,756 |
| 14,339,389 |
| 17,791,281 |
| 43,468,249 |
Other financial liabilities |
| - |
| - |
| 13,370,785 |
| 8,914,175 |
| 22,284,960 |
Total |
| $74,820,467 |
| $14,149,834 |
| $36,247,273 |
| $32,480,097 |
| $157,697,671 |
Derivative financial liabilities |
|
|
|
|
|
|
|
|
|
|
Forward exchangecontracts |
|
|
|
|
|
|
|
|
|
|
Gross settlement |
|
|
|
|
|
|
|
|
|
|
Inflow |
| $422,645 |
| $- |
| $- |
| $- |
| $422,645 |
Outflow |
| (424,724) |
| - |
| - |
| - |
| (424,724) |
Net |
| (2,079) |
| - |
| - |
| - |
| (2,079) |
Net settlement -outflow |
| (20,282) |
| - |
| - |
| - |
| (20,282) |
Total |
| $(22,361) |
| $- |
| $- |
| $- |
| $(22,361) |
(6) Foreign currency risk management
UMC entered into forward exchange contracts for hedging the exchange rate risk arising from the net monetary assets or liabilities denominated in foreign currency. The details of forward exchange contracts entered into by UMC are summarized as follows:
As of September 30, 2018
Type |
| Notional Amount |
| Contract Period |
Forward exchange contracts |
| Sell USD 96 million |
| September 4, 2018~ October 9, 2018 |
As of December 31, 2017: None.
As of September 30, 2017
Type |
| Notional Amount |
| Contract Period |
Forward exchange contracts |
| Sell USD 206 million |
| September 19, 2017~ October 12, 2017 |
(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 hierarchy by 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.
a. Assets and liabilities measured and recorded at fair value on a recurring basis:
|
| As of September 30, 2018 | ||||||
|
| Level 1 |
| Level 2 |
| Level 3 |
| Total |
Financial assets: |
|
|
|
|
|
|
|
|
Financial assets at fair valuethrough profit or loss, current |
| $367,009 |
| $55,317 |
| $- |
| $422,326 |
Financial assets at fair valuethrough profit or loss, noncurrent |
| 4,181,431 |
| 42,652 |
| 8,284,596 |
| 12,508,679 |
Financial assets at fair value through other comprehensive income, noncurrent |
| 7,996,582 |
| - |
| 3,726,408 |
| 11,722,990 |
Financial liabilities: |
|
|
|
|
|
|
|
|
Hedgingfinancial liabilities, current |
| - |
| 64,315 |
| - |
| 64,315 |
|
|
|
|
|
|
|
|
|
|
| As of December 31, 2017 | ||||||
|
| Level 1 |
| Level 2 |
| Level 3 |
| Total |
Financial assets: |
|
|
|
|
|
|
|
|
Financial assets at fair valuethrough profit or loss, current |
| $663,138 |
| $22,175 |
| $31,605 |
| $716,918 |
Financial assets at fair valuethrough profit or loss, noncurrent |
| 174,760 |
| 16,245 |
| - |
| 191,005 |
Available-for-sale financial assets, noncurrent |
| 10,959,194 |
| - |
| 9,677,138 |
| 20,636,332 |
|
|
| ||||||
|
| As of September 30, 2017 | ||||||
|
| Level 1 |
| Level 2 |
| Level 3 |
| Total |
Financial assets: |
|
|
|
|
|
|
|
|
Financial assets at fair valuethrough profit or loss, current |
| $787,082 |
| $56,996 |
| $- |
| $844,078 |
Financial assets at fair valuethrough profit or loss, noncurrent |
| 173,400 |
| - |
| - |
| 173,400 |
Available-for-sale financial assets, noncurrent |
| 10,493,756 |
| - |
| 10,562,105 |
| 21,055,861 |
Financial liabilities: |
|
|
|
|
|
|
|
|
Financialliabilities at fair value through profit or loss, current |
| - |
| 22,361 |
| - |
| 22,361 |
Fair values of financial assets at fair value through profit or loss, financial assets at fair value through other comprehensive income and available-for-sale financial assets that are categorized into level 1 are based on the quoted market prices in active markets. 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 a 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.To measure fair values, if the lowest level input that is significant to the fair value measurement is directly or indirectly observable, then the financial assets are classified as Level 2 of the fair value hierarchy, otherwise as level 3.
During the nine-month periods ended September 30, 2018 and 2017, 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:
|
| Financial assets at fair value through profit or loss |
| Financial assets at fair value through comprehensive income (loss) | ||||||||||||
|
| Option |
| Common stock |
| Preferred stock |
| Funds |
| Total |
| Common stock |
| Preferred stock |
| Total |
As of January 1, 2018 |
| $31,605 |
| $3,832,537 |
| $2,994,294 |
| $1,183,940 |
| $8,042,376 |
| $3,350,694 |
| $233,326 |
| $3,584,020 |
Recognized in profit (loss) |
| (31,605) |
| (309,808) |
| (25,174) |
| 75,239 |
| (291,348) |
| - |
| - |
| - |
Recognized in other comprehensive income (loss) |
| - |
| - |
| - |
| - |
| - |
| 143,719 |
| (1,331) |
| 142,388 |
Acquisition |
| - |
| 113,332 |
| 569,583 |
| 525,595 |
| 1,208,510 |
| - |
| - |
| - |
Disposal |
| - |
| (83,953) |
| (221,237) |
| - |
| (305,190) |
| - |
| - |
| - |
Return of capital |
| - |
| (22,954) |
| - |
| - |
| (22,954) |
| - |
| - |
| - |
Transfer to Level 3 |
| - |
| 22,050 |
| - |
| - |
| 22,050 |
| - |
| - |
| - |
Transfer out of Level 3 |
| - |
| (442,138) |
| - |
| - |
| (442,138) |
| - |
| - |
| - |
Exchange effect |
| - |
| 16,391 |
| 45,754 |
| 11,145 |
| 73,290 |
| - |
| - |
| - |
As of September 30, 2018 |
| $- |
| $3,125,457 |
| $3,363,220 |
| $1,795,919 |
| $8,284,596 |
| $3,494,413 |
| $231,995 |
| $3,726,408 |
|
| Available-for-sale financial assets | ||||||
|
| Common stock |
| Funds |
| Preferred stock |
| Total |
As ofJanuary 1, 2017 |
| $7,687,752 |
| $942,296 |
| $1,203,589 |
| $9,833,637 |
Recognized in profit (loss) |
| (184,112) |
| (58,360) |
| - |
| (242,472) |
Recognized in othercomprehensive income (loss) |
| 209,805 |
| 15,128 |
| (31,859) |
| 193,074 |
Acquisition |
| 169,905 |
| 148,549 |
| 414,834 |
| 733,288 |
Disposal |
| (149,789) |
| - |
| - |
| (149,789) |
Transfer to Level 3 |
| 87,850 |
| - |
| 311,288 |
| 399,138 |
Transfer out of Level 3 |
| (95,887) |
| - |
| - |
| (95,887) |
Exchange effect |
| (26,226) |
| (35,914) |
| (46,744) |
| (108,884) |
As of September 30, 2017 |
| $7,699,298 |
| $1,011,699 |
| $1,851,108 |
| $10,562,105 |
Recognized as part of profit (loss) above, the profit (loss) from financial assets still held by the Company as of September 30, 2018 and 2017 was NT$(165) million and NT$(242) million.
Recognized as part of other comprehensive income (loss) above, the income from financial assets still held by the Company as of September 30, 2018 and 2017 was NT$142million and NT$189 million, respectively.
The Company’s policy to recognize the transfer into and out of fair value hierarchy levels is based on the event or changes in circumstances that caused the transfer.
Significant unobservable inputs of fair value measurement in Level 3 fair value hierarchy were as follow:
As of September 30, 2018 | ||||||||||
Category of equity securities |
| Valuation technique |
| Significant unobservable inputs |
| Quantitative information |
| Interrelationship between inputs and fair value |
| Sensitivity analysis of interrelationship between inputs and fair value |
Unlisted stock |
| Market Approach |
| Discount for lack ofmarketability |
| 15%~50% |
| The greater degree of lack ofmarketability, the lower the estimated fair value is determined. |
| A change of 5% in the discount for lack of marketability of the aforementioned fair values of unlisted stocks could decrease/increase the Company’s profit or loss and other comprehensive income (loss) for the nine-month period ended September 30, 2018 by NT$349 million and by NT$263 million, respectively. |
As of September 30, 2017 | ||||||||||
Category of equity securities |
| Valuation technique |
| Significant unobservable inputs |
| Quantitative information |
| Interrelationship between inputs and fair value |
| Sensitivity analysis of interrelationship between inputs and fair value |
Unlisted stock |
| Market Approach |
| Discount for lack ofmarketability |
| 20%~50% |
| The greater degree of lack ofmarketability, the lower the estimated fair value is determined. |
| A change of 5% in the discount for lack of marketability of the aforementioned fair values of unlisted stocks could decrease/increase the Company’s other comprehensive income (loss) for the nine-month period ended September 30, 2017 by NT$475 million. |
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 payable is estimated by the market price or using a valuation model. The model uses market-based observable inputs including share price, volatility, credit spread and risk-free interest 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 guarantee deposits approximate their carrying amount due to their maturities within one year.
As of September 30, 2018
|
|
|
| Fair value measurements during reporting period using |
|
| ||||
Items |
| Fair value |
| Level 1 |
| Level 2 |
| Level 3 |
| Carrying amount |
Bonds payables (current portion included) |
| $42,129,376 |
| $23,950,473 |
| $18,178,903 |
| $- |
| $41,287,378 |
Long-term loans (current portion included) |
| 31,681,390 |
| - |
| 31,681,390 |
| - |
| 31,681,390 |
As of December 31, 2017
|
|
|
| Fair value measurements during reporting period using |
|
| ||||
Items |
| Fair value |
| Level 1 |
| Level 2 |
| Level 3 |
| Carrying amount |
Bonds payables (current portion included) |
| $49,342,714 |
| $31,422,772 |
| $17,919,942 |
| $- |
| $48,517,631 |
Long-term loans (current portion included) |
| 32,165,336 |
| - |
| 32,165,336 |
| - |
| 32,165,336 |
As of September 30, 2017
|
|
|
| Fair value measurements during reporting period using |
|
| ||||
Items |
| Fair value |
| Level 1 |
| Level 2 |
| Level 3 |
| Carrying amount |
Bonds payables (current portion included) |
| $43,952,311 |
| $26,049,928 |
| $17,902,383 |
| $- |
| $43,034,883 |
Long-term loans (current portion included) |
| 35,395,219 |
| - |
| 35,395,219 |
| - |
| 35,395,219 |
(8) Significant assets and liabilities denominated in foreign currencies
|
| ||||||||||
| As of | ||||||||||
| September 30, 2018 |
| December 31, 2017 | ||||||||
| Foreign Currency (thousand) |
| Exchange Rate |
| NTD (thousand) |
| Foreign Currency (thousand) |
| Exchange Rate |
| NTD (thousand) |
Financial Assets |
|
|
|
|
|
|
|
|
|
|
|
Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD | $1,441,953 |
| 30.48 |
| $43,950,737 |
| $1,703,079 |
| 29.72 |
| $50,609,425 |
JPY | 15,821,153 |
| 0.2674 |
| 4,230,577 |
| 5,914,143 |
| 0.2627 |
| 1,553,244 |
EUR | 3,694 |
| 35.30 |
| 130,387 |
| 2,818 |
| 35.27 |
| 99,394 |
SGD | 28,934 |
| 22.26 |
| 644,072 |
| 29,696 |
| 22.22 |
| 659,865 |
RMB | 5,452,588 |
| 4.41 |
| 24,062,271 |
| 2,499,747 |
| 4.55 |
| 11,368,839 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD | 233,024 |
| 30.48 |
| 7,102,577 |
| 154,761 |
| 29.73 |
| 4,601,061 |
JPY | 8,810,411 |
| 0.2674 |
| 2,355,904 |
| 9,150,629 |
| 0.2627 |
| 2,403,870 |
SGD | 10,422 |
| 22.26 |
| 231,995 |
| - |
| - |
| - |
RMB | 49,734 |
| 4.41 |
| 219,476 |
| - |
| - |
| - |
Financial Liabilities |
|
|
|
|
|
|
|
|
|
|
|
Monetary items |
|
|
|
|
|
|
|
|
|
|
|
USD | $310,455 |
| 30.58 |
| $9,493,816 |
| $576,458 |
| 29.83 |
| $17,195,765 |
JPY | 3,245,775 |
| 0.2715 |
| 881,229 |
| 3,252,323 |
| 0.2668 |
| 867,720 |
EUR | 4,341 |
| 35.70 |
| 154,992 |
| 3,696 |
| 35.84 |
| 132,475 |
SGD | 41,171 |
| 22.44 |
| 923,872 |
| 32,498 |
| 22.40 |
| 727,952 |
RMB | 15,104,450 |
| 4.46 |
| 67,411,163 |
| 15,618,686 |
| 4.60 |
| 71,814,722 |
|
|
|
|
|
|
|
|
|
|
|
|
The exchange gain or loss from monetary financial assets and liabilities |
|
|
|
|
|
|
|
|
|
|
|
USD |
|
|
|
| 524,566 |
|
|
|
|
| (751,616) |
JPY |
|
|
|
| (52,604) |
|
|
|
|
| 44,587 |
EUR |
|
|
|
| 10,751 |
|
|
|
|
| 1,816 |
SGD |
|
|
|
| 4,088 |
|
|
|
|
| 15,703 |
RMB |
|
|
|
| (1,147,770) |
|
|
|
|
| 2,255,067 |
Other |
|
|
|
| (53) |
|
|
|
|
| 348 |
|
|
| ||||
|
| As of | ||||
|
| September 30, 2017 | ||||
|
| Foreign Currency (thousand) |
| Exchange Rate |
| NTD (thousand) |
Financial Assets |
|
|
|
|
|
|
Monetary items |
|
|
|
|
|
|
USD |
| $1,629,819 |
| 30.23 |
| $49,273,018 |
JPY |
| 5,223,030 |
| 0.2677 |
| 1,398,436 |
EUR |
| 5,143 |
| 35.49 |
| 182,527 |
SGD |
| 42,135 |
| 22.25 |
| 937,502 |
RMB |
| 1,537,373 |
| 4.54 |
| 6,975,061 |
|
|
|
|
|
|
|
Non-Monetary items |
|
|
|
|
|
|
USD |
| 156,421 |
| 30.25 |
| 4,731,735 |
JPY |
| 11,656,934 |
| 0.2678 |
| 3,121,727 |
Financial Liabilities |
|
|
|
|
|
|
Monetary items |
|
|
|
|
|
|
USD |
| $670,172 |
| 30.35 |
| $20,339,734 |
JPY |
| 3,184,042 |
| 0.2719 |
| 865,741 |
EUR |
| 1,886 |
| 35.99 |
| 67,876 |
SGD |
| 40,469 |
| 22.43 |
| 907,739 |
RMB |
| 14,585,730 |
| 4.59 |
| 66,904,747 |
|
|
|
|
|
|
|
The exchange gain or loss from monetary financial assets and liabilities |
|
|
|
|
|
|
USD |
|
|
|
|
| (587,909) |
JPY |
|
|
|
|
| 31,715 |
EUR |
|
|
|
|
| 3,857 |
SGD |
|
|
|
|
| 12,481 |
RMB |
|
|
|
|
| 1,605,201 |
Other |
|
|
|
|
| 483 |
(9) Significant intercompany transactions among consolidated entities forthe nine-month periods ended September 30, 2018 and 2017 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.
The Company’s strategy, which is unchanged for the reporting periods, is to maintain a reasonable ratio in order to raise capital with reasonable cost. The debt to capital ratios as ofSeptember 30, 2018, December 31, 2017 andSeptember 30, 2017 were as follows:
|
| As of | ||||
|
| September 30, 2018 |
| December 31, 2017 |
| September 30, 2017 |
Total liabilities |
| $160,111,263 |
| $180,061,578 |
| $169,735,846 |
Less: Cash and cash equivalents |
| (81,520,158) |
| (81,674,572) |
| (69,938,407) |
Net debt |
| 78,591,105 |
| 98,387,006 |
| 99,797,439 |
Total equity |
| 212,557,966 |
| 214,037,584 |
| 214,437,187 |
Total capital |
| 291,149,071 |
| $312,424,590 |
| $314,234,626 |
Debt to capital ratios |
| 26.99% |
| 31.49% |
| 31.76% |
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 the nine-month period endedSeptember 30, 2018: Please refer to Attachment 2.
b. Endorsement/Guarantee provided to others for the nine-month period endedSeptember 30, 2018: Please refer to Attachment 3.
c. Securities held as ofSeptember 30, 2018 (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 thenine-month period endedSeptember 30, 2018: 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 forthe nine-month period endedSeptember 30, 2018: Please refer to Attachment 6.
f. Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock forthe nine-month period endedSeptember 30, 2018: 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 forthe nine-month period endedSeptember 30, 2018: 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 ofSeptember 30, 2018: Please refer to Attachment 9.
i. Names, locations and related information of investees as ofSeptember 30, 2018 (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),carrying amount 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: Please refer to Attachment 1, Attachment 2, Attachment 3, Attachment 5 and Attachment 8.
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 of September 30, 2018, the Company had the following segments: wafer fabrication and new business. The operating segment information was prepared according to the accounting policies described in Note 4. 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).
Reportable segment information for thethree-month and nine-month periods endedSeptember 30, 2018 and 2017 were as follows:
|
| For the three-month period ended September 30, 2018 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Net revenue from external customers |
| $39,328,727 |
| $57,929 |
| $39,386,656 |
| $- |
| $39,386,656 |
Net revenue from sales among intersegments |
| - |
| 1,925 |
| 1,925 |
| (1,925) |
| - |
Segment net income (loss), net of tax |
| 207,607 |
| (91,453) |
| 116,154 |
| 80,704 |
| 196,858 |
Capital expenditure |
| 5,612,233 |
| - |
| 5,612,233 |
| - |
| 5,612,233 |
Depreciation |
| 12,432,730 |
| 37,458 |
| 12,470,188 |
| - |
| 12,470,188 |
Share of profit or loss of associates and joint ventures |
| 112,478 |
| - |
| 112,478 |
| 80,704 |
| 193,182 |
Income tax expense (benefit) |
| 631,053 |
| 612 |
| 631,665 |
| - |
| 631,665 |
|
| For the three-month period ended September 30, 2017 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Net revenue from external customers |
| $37,612,366 |
| $85,835 |
| $37,698,201 |
| $- |
| $37,698,201 |
Net revenue from sales among intersegments |
| - |
| 5,274 |
| 5,274 |
| (5,274) |
| - |
Segment net income (loss), net of tax |
| 2,488,497 |
| (64,478) |
| 2,424,019 |
| 39,899 |
| 2,463,918 |
Capital expenditure |
| 7,286,484 |
| 1,742 |
| 7,288,226 |
| - |
| 7,288,226 |
Depreciation |
| 12,935,174 |
| 53,274 |
| 12,988,448 |
| - |
| 12,988,448 |
Share of profit or loss of associates and joint ventures |
| 155,300 |
| 9,635 |
| 164,935 |
| 39,899 |
| 204,834 |
Income tax expense (benefit) |
| 401,909 |
| (361) |
| 401,548 |
| - |
| 401,548 |
|
| For the nine-month period ended September 30, 2018 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Net revenue from external customers |
| $115,532,965 |
| $202,405 |
| $115,735,370 |
| $- |
| $115,735,370 |
Net revenue from sales among intersegments |
| - |
| 16,154 |
| 16,154 |
| (16,154) |
| - |
Segment net income (loss), net of tax |
| 5,678,113 |
| (472,109) |
| 5,206,004 |
| 437,188 |
| 5,643,192 |
Capital expenditure |
| 15,229,219 |
| - |
| 15,229,219 |
| - |
| 15,229,219 |
Depreciation |
| 37,922,850 |
| 133,506 |
| 38,056,356 |
| - |
| 38,056,356 |
Share of profit or loss of associates and joint ventures |
| 66,389 |
| (23,244) |
| 43,145 |
| 437,188 |
| 480,333 |
Income tax expense (benefit) |
| (870,857) |
| (1,165) |
| (872,022) |
| - |
| (872,022) |
|
| For the nine-month period ended September 30, 2017 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination |
| Consolidated |
Net revenue from external customers |
| $112,405,269 |
| $248,763 |
| $112,654,032 |
| $- |
| $112,654,032 |
Net revenue from sales among intersegments |
| - |
| 12,146 |
| 12,146 |
| (12,146) |
| - |
Segment net income (loss), net of tax |
| 5,524,912 |
| (550,704) |
| 4,974,208 |
| 464,366 |
| 5,438,574 |
Capital expenditure |
| 33,270,198 |
| 4,852 |
| 33,275,050 |
| - |
| 33,275,050 |
Depreciation |
| 38,089,017 |
| 177,672 |
| 38,266,689 |
| - |
| 38,266,689 |
Share of profit or loss of associates and joint ventures |
| (260,271) |
| (7,761) |
| (268,032) |
| 464,366 |
| 196,334 |
Income tax expense (benefit) |
| 611,616 |
| (927) |
| 610,689 |
| - |
| 610,689 |
|
| As of September 30, 2018 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination (Note) |
| Consolidated |
Segment assets |
| $371,491,269 |
| $1,613,797 |
| $373,105,066 |
| $(435,837) |
| $372,669,229 |
Segment liabilities |
| $158,958,306 |
| $1,244,434 |
| $160,202,740 |
| $(91,477) |
| $160,111,263 |
|
| As of December 31, 2017 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination (Note) |
| Consolidated |
Segment assets |
| $392,370,323 |
| $3,030,057 |
| $395,400,380 |
| $(1,301,218) |
| $394,099,162 |
Segment liabilities |
| $178,362,985 |
| $1,700,045 |
| $180,063,030 |
| $(1,452) |
| $180,061,578 |
|
| As of September 30, 2017 | ||||||||
|
| Wafer Fabrication |
| New Business |
| Subtotal |
| Adjustment and Elimination (Note) |
| Consolidated |
Segment assets |
| $382,448,702 |
| $3,138,655 |
| $385,587,357 |
| $(1,414,324) |
| $384,173,033 |
Segment liabilities |
| $168,048,600 |
| $1,689,603 |
| $169,738,203 |
| $(2,357) |
| $169,735,846 |
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.
ATTACHMENT 1 (Significant intercompany transactions between consolidated entities) | ||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||
For the nine-month period ended September 30, 2018 | ||||||||||||||
Related party | Counterparty | Relationship with the Company | Transactions | |||||||||||
No. | Account | Amount | Collection periods | Percentage of consolidated operating | ||||||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP (USA) | 1 | Sales | $43,416,250 | Net 60 days | 38% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP (USA) | 1 | Accounts receivable | 6,928,503 | - | 2% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP JAPAN | 1 | Sales | 3,046,577 | Net 60 days | 3% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP JAPAN | 1 | Accounts receivable | 732,362 | - | 0% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | 1 | Sales | 1,036,687 | Net 30 days | 1% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | 1 | Accounts receivable | 24,661 | - | 0% | |||||||
1 | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | UMC GROUP (USA) | 3 | Sales | 483,536 | Net 60 days | 0% | |||||||
1 | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | UMC GROUP (USA) | 3 | Accounts receivable | 87,980 | - | 0% | |||||||
2 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP (USA) | 3 | Sales | 246,337 | Net 60 days | 0% | |||||||
2 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP (USA) | 3 | Accounts receivable | 38,798 | - | 0% | |||||||
2 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP JAPAN | 3 | Sales | 181,558 | Net 60 days | 0% | |||||||
2 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP JAPAN | 3 | Accounts receivable | 49,128 | - | 0% | |||||||
For the nine-month period ended September 30, 2017 | ||||||||||||||
Related party | Counterparty | Relationship with the Company | Transactions | |||||||||||
No. | Account | Amount | Collection periods | Percentage of consolidated operating | ||||||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP (USA) | 1 | Sales | $45,035,480 | Net 60 days | 40% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP (USA) | 1 | Accounts receivable | 8,650,956 | - | 2% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP JAPAN | 1 | Sales | 3,264,022 | Net 60 days | 3% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UMC GROUP JAPAN | 1 | Accounts receivable | 495,713 | - | 0% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | 1 | Sales | 698,130 | Net 30 days | 1% | |||||||
0 | UNITED MICROELECTRONICS CORPORATION | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | 1 | Accounts receivable | 4,881,503 | - | 1% | |||||||
1 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP (USA) | 3 | Sales | 160,371 | Net 60 days | 0% | |||||||
1 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP (USA) | 3 | Accounts receivable | 39,990 | - | 0% | |||||||
1 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP JAPAN | 3 | Sales | 159,078 | Net 60 days | 0% | |||||||
1 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UMC GROUP JAPAN | 3 | Accounts receivable | 39,789 | - | 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 in reference to 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. | ||||||||||||||
Note 5: UMC authorized technology licenses to its subsidiary, UNITED SEMICONDUCTOR (XIAMEN) CO., LTD., in the amount of US$0.35 billion which was recognized as deferred revenue. | ||||||||||||||
Since it was a downstream transaction, the deferred revenue would be realized over time. |
ATTACHMENT 2 (Financing provided to others for the nine-month period ended September 30, 2018) | ||||||||||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||||||||||||||||
UNITED MICROELECTRONICS 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 | Loss allowance |
| Limit of financing amount for individual counter-party (Note2) | Limit of total financing amount (Note2) | |||||||||||||||||
Item | Value | |||||||||||||||||||||||||||||||
0 | UNITED MICROELECTRONICS CORPORATION | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | Other receivables - related parties | YES | $10,119,360 | $6,096,000 | $- | 2.05%~2.61% | The need for short-term financing | $- | Business turnover | $- | None | $- | $21,206,473 | $84,825,890 | ||||||||||||||||
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 | Loss allowance |
| Limit of financing amount for individual counter-party (Note3) | Limit of total financing amount (Note3) | |||||||||||||||||
Item | Value | |||||||||||||||||||||||||||||||
1 | TERA ENERGY DEVELOPMENT CO., LTD. | TIPPING POINT ENERGY COC PPA SPE-1,LLC | Other receivables | No | $2,384 | $2,384 | $2,384 | 9.00% | Needs for operation | $2,384 | - | $2,384 | None | $- | $2,384 | $68,023 | ||||||||||||||||
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 shall not exceed 10% of the lender's net assets value as of the period. | ||||||||||||||||||||||||||||||||
Limit of total financing amount shall not exceed 40% of the Company’s net asset value. | ||||||||||||||||||||||||||||||||
Note 3: Limit of financing amount for individual counter-party shall not exceed 10% 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 latest financial statements of lender. |
ATTACHMENT 3 (Endorsement/Guarantee provided to others for the nine-month period ended September 30, 2018) | ||||||||||||||||||||
(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) | Maximum balance for the period | 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 | Ending balance | Actual amount | Amount of collateral guarantee/endorsement | |||||||||||||||
0 | UNITED MICROELECTRONICS | NEXPOWER TECHNOLOGY CORP. | 3 | $95,429,126 | $1,700,000 | $1,700,000 | $747,900 | $- | 0.80% | $95,429,126 | ||||||||||
0 | UNITED MICROELECTRONICS | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | 3 | 95,429,126 | 14,081,760 | 14,081,760 | 13,842,504 | - | 6.64% | 95,429,126 | ||||||||||
0 | UNITED MICROELECTRONICS | SOCIALNEX ITALIA 1 S.R.L. | 3 | 95,429,126 | 19,917 | - | - | - | - | 95,429,126 | ||||||||||
HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | ||||||||||||||||||||
No. | Endorsor/Guarantor | Receiving party | Limit of guarantee/endorsement amount for receiving party (Note 8) | Maximum balance for the period | Percentage of accumulated guarantee amount to net assets value from the latest financial statement | Limit of total guarantee/endorsement amount (Note 8) | ||||||||||||||
Company name |
| Releationship | Ending balance | Actual amount | Amount of collateral guarantee/endorsement | |||||||||||||||
1 | HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | 6 | $10,046,791 | $8,964,706 | $8,964,706 | $4,413,993 | $- | 40.15% | $10,046,791 | ||||||||||
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 with which it does business. | ||||||||||||||||||
2. A company in which the public company directly and indirectly holds more than 50% of the voting shares. | ||||||||||||||||||
3. A company that directly and indirectly holds more than 50 % of the voting shares in the public company. | ||||||||||||||||||
4. A company in which the public company holds, directly or indirectly, 90% or more of the voting shares. | ||||||||||||||||||
5. A company that fulfills its contractual obligations by providing mutual endorsements/guarantees for another company in the same industry or for joint builders for purposes of undertaking a construction project. | ||||||||||||||||||
6. A company that all capital contributing shareholders make endorsements/ guarantees for their jointly invested company in proportion to their shareholding percentages. | ||||||||||||||||||
7. Companies in the same industry provide among themselves joint and several security for a performance guarantee of a sales contract for pre-construction homes pursuant to the Consumer Protection Act for each other. | ||||||||||||||||||
Note 3: The amount of endorsements/guarantees shall not exceed 45% of the net worth of endorsor/guarantor; and the ceilings on the amount of endorsements/guarantees for any single entity are as follows: | ||||||||||||||||||
1. The amount of endorsements/guarantees for any single entity shall not exceed 45% of net worth of endorsor/guarantor. | ||||||||||||||||||
2. The amount of endorsements/guarantees 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 endorsements/guarantees that the Company as a whole is permitted to make shall not exceed 45% of the Company's net worth, and the aggregate amount of | ||||||||||||||||||
endorsements/guarantees for any single entity shall not exceed 45% of the Company's net worth. | ||||||||||||||||||
Note 4: Limit of total guarantee/endorsement amount shall not exceed 45% of UMC's net assets value as of September 30, 2018. | ||||||||||||||||||
Note 5: On December 24, 2014, the board of directors resolved to provide endorsement to NEXPOWER TECHNOLOGY CORP.'s syndicated loan from banks including Bank of Taiwan for the amount up to NT$1,700 million. | ||||||||||||||||||
As of September 30, 2018, actual amount provided was NT$748 million. | ||||||||||||||||||
Note 6: On Feburary 22, 2017, the board of directors resolved to guarantee UNITED SEMICONDUCTOR (XIAMEN) CO., LTD.'s syndicated loan from banks including China Development Bank in the amount up to USD 310 million. | ||||||||||||||||||
On March 7, 2018, the board of directors resolved to increase the endorsement amounted to USD 152 million. Total endorsement amount is up to USD 462 million. | ||||||||||||||||||
As of September 30, 2018, actual amount provided was NT$13,843 million. | ||||||||||||||||||
Note 7: On April 26, 2017, the board of directors resolved that UMC directly provided guarantee to SOCIALNEX ITALIA 1 S.R.L., NEXPOWER TECHNOLOGY CORP.'s subsidiary, in the amount up to EUR 558 thousand on June 20, 2017. | ||||||||||||||||||
The guarantee to SOCIALNEX ITALIA 1 S.R.L. ended in August , 2018. | ||||||||||||||||||
Note 8: Limit of total endorsed/guaranteed amount shall not exceed 45% of HEJIAN TECHNOLOGY (SUZHOU) CO., LTD.'s net assets value as of September 30, 2018. | ||||||||||||||||||
The amount of endorsements/guarantees for any single entity shall not exceed 45% of net worth of HEJIAN TECHNOLOGY (SUZHOU) CO., LTD.'s net assets value as of September 30, 2018. | ||||||||||||||||||
The aggregate amount of endorsements/guarantees that the Company as a whole is permitted to make shall not exceed 45% of the Company's net worth, and the aggregate amount of | ||||||||||||||||||
endorsements/guarantees for any single entity shall not exceed 45% of the Company's net worth. |
ATTACHMENT 4 (Securities held as of September 30, 2018) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
UNITED MICROELECTRONICS CORPORATION | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | ACTION ELECTRONICS CO., LTD. | - | Financial assets at fair value through profit or loss, current | 18,182 | $131,639 | 6.56 | $131,639 | None | ||||||||||
Stock | PIXART IMAGING, INC. | - | Financial assets at fair value through profit or loss, current | 1,600 | 180,800 | 1.18 | 180,800 | None | ||||||||||
Stock | KING YUAN ELECTRONICS CO., LTD. | - | Financial assets at fair value through profit or loss, current | 2,675 | 54,570 | 0.22 | 54,570 | None | ||||||||||
Stock | PIXTECH, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 9,883 | - | 17.63 | - | None | ||||||||||
Stock | UNITED FU SHEN CHEN TECHNOLOGY CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 17,511 | - | 15.75 | - | None | ||||||||||
Stock | HOLTEK SEMICONDUCTOR INC. | - | Financial assets at fair value through profit or loss, noncurrent | 24,644 | 1,951,825 | 10.90 | 1,951,825 | None | ||||||||||
Stock | OCTTASIA INVESTMENT HOLDING INC. | - | Financial assets at fair value through profit or loss, noncurrent | 6,692 | 210,086 | 9.29 | 210,086 | None | ||||||||||
Stock | UNITED INDUSTRIAL GASES CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 16,680 | 1,295,762 | 7.66 | 1,295,762 | None | ||||||||||
Stock | AMIC TECHNOLOGY CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 5,627 | - | 4.71 | - | None | ||||||||||
Stock | SUBTRON TECHNOLOGY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 12,521 | 112,687 | 4.38 | 112,687 | None | ||||||||||
Stock | KING YUAN ELECTRONICS CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 20,483 | 417,847 | 1.68 | 417,847 | None | ||||||||||
Stock | EPISTAR CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 10,715 | 371,810 | 0.98 | 371,810 | None | ||||||||||
Stock | TOPOINT TECHNOLOGY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 1,315 | 24,791 | 0.82 | 24,791 | None | ||||||||||
Stock | PROMOS TECHNOLOGIES INC. | - | Financial assets at fair value through profit or loss, noncurrent | 324 | - | 0.72 | - | None | ||||||||||
Stock-Preferred stock | TONBU, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 938 | - | - | - | None | ||||||||||
Stock-Preferred stock | AETAS TECHNOLOGY INC. | - | Financial assets at fair value through profit or loss, noncurrent | 1,166 | - | - | - | None | ||||||||||
Stock-Preferred stock | TA SHEE GOLF & COUNTRY CLUB | - | Financial assets at fair value through profit or loss, noncurrent | 0 | 25,200 | - | 25,200 | None | ||||||||||
Stock | SILICON INTEGRATED SYSTEMS CORP. | The Company's director | Financial assets at fair value through other comprehensive income, noncurrent | 110,356 | 1,109,075 | 19.70 | 1,109,075 | None | ||||||||||
Stock | UNIMICRON HOLDING LIMITED | - | Financial assets at fair value through other comprehensive income, noncurrent | 20,000 | 633,984 | 17.00 | 633,984 | None | ||||||||||
Stock | MIE FUJITSU SEMICONDUCTOR LIMITED | - | Financial assets at fair value through other comprehensive income, noncurrent | 18,447 | 2,215,834 | 15.87 | 2,215,834 | None | ||||||||||
Stock | UNIMICRON TECHNOLOGY CORP. | - | Financial assets at fair value through other comprehensive income, noncurrent | 196,136 | 3,932,527 | 13.03 | 3,932,527 | None | ||||||||||
Stock | ITE TECH. INC. | - | Financial assets at fair value through other comprehensive income, noncurrent | 13,960 | 471,847 | 8.66 | 471,847 | None | ||||||||||
Stock | NOVATEK MICROELECTRONICS CORP. | - | Financial assets at fair value through other comprehensive income, noncurrent | 16,445 | 2,483,133 | 2.70 | 2,483,133 | None | ||||||||||
Stock-Preferred stock | MTIC HOLDINGS PTE. LTD. | - | Financial assets at fair value through other comprehensive income, noncurrent | 12,000 | 231,995 | - | 231,995 | None | ||||||||||
ATTACHMENT 4 (Securities held as of September 30, 2018) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | DARCHUN VENTURE CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 1,782 | $6,378 | 19.65 | $6,378 | None | ||||||||||
Stock | SOLARGATE TECHNOLOGY CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 957 | 0 | 15.94 | 0 | None | ||||||||||
Stock | TRONC-E CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 1,800 | 5,382 | 15.93 | 5,382 | None | ||||||||||
Stock | CENTERA PHOTONICS INC. | - | Financial assets at fair value through profit or loss, noncurrent | 2,500 | 9,400 | 11.41 | 9,400 | None | ||||||||||
Stock | EVERGLORY RESOURCE TECHNOLOGY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 2,500 | 18,375 | 10.23 | 18,375 | None | ||||||||||
Stock | ADVANCE MATERIALS CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 11,910 | 66,218 | 8.67 | 66,218 | None | ||||||||||
Stock | WIN WIN PRECISION TECHNOLOGY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 3,150 | 22,050 | 6.93 | 22,050 | None | ||||||||||
Stock | RISELINK VENTURE CAPITAL CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 1,754 | 14,545 | 6.67 | 14,545 | None | ||||||||||
Stock | ACT GENOMICS HOLDINGS CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 4,600 | 17,577 | 6.54 | 17,577 | None | ||||||||||
Stock | LICO TECHNOLOGY CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 6,609 | 0 | 5.32 | 0 | None | ||||||||||
Stock | ACTI CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 1,968 | 11,551 | 5.31 | 11,551 | None | ||||||||||
Stock | PARAWIN VENTURE CAPITAL CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 1,662 | 2,244 | 5.00 | 2,244 | None | ||||||||||
Stock | TAIWAN AULISA MEDICAL DEVICES TECHNOLOGIES, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 800 | 5,576 | 4.97 | 5,576 | None | ||||||||||
Stock | WALTOP INTERNATIONAL CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 654 | 1,432 | 4.43 | 1,432 | None | ||||||||||
Stock | MERIDIGEN BIOTECH CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 3,838 | 24,600 | 4.34 | 24,600 | None | ||||||||||
Stock | EXCELLENCE OPTOELECTRONICS INC. | - | Financial assets at fair value through profit or loss, noncurrent | 6,374 | 109,631 | 3.72 | 109,631 | None | ||||||||||
Stock | SOLID STATE SYSTEM CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 3,000 | 69,000 | 3.71 | 69,000 | None | ||||||||||
Stock | SUBTRON TECHNOLOGY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 10,059 | 90,529 | 3.52 | 90,529 | None | ||||||||||
Stock | ANIMATION TECHNOLOGIES INC. | - | Financial assets at fair value through profit or loss, noncurrent | 265 | - | 3.16 | - | None | ||||||||||
Stock | TOPOINT TECHNOLOGY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 4,907 | 92,494 | 3.08 | 92,494 | None | ||||||||||
Stock | DAWNING LEADING TECHNOLOGY INC. | - | Financial assets at fair value through profit or loss, noncurrent | 5,550 | 16,651 | 2.42 | 16,651 | None | ||||||||||
Stock | MOBILE DEVICES INC. | - | Financial assets at fair value through profit or loss, noncurrent | 261 | - | 1.96 | - | None | ||||||||||
Stock | WIESON TECHNOLOGIES CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 1,141 | 5,591 | 1.71 | 5,591 | None | ||||||||||
Stock | ALL-STARS XMI LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 7 | 201,599 | 1.37 | 201,599 | None | ||||||||||
Stock | CRYSTALWISE TECHNOLOGY INC. | - | Financial assets at fair value through profit or loss, noncurrent | 2,114 | 34,239 | 1.29 | 34,239 | None | ||||||||||
ATTACHMENT 4 (Securities held as of September 30, 2018) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | PRIMESENSOR TECHNOLOGY INC. | - | Financial assets at fair value through profit or loss, noncurrent | 434 | $690 | 1.06 | $690 | None | ||||||||||
Stock | NORATECH PHARMACEUTICALS, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 1,000 | 10,610 | 0.95 | 10,610 | None | ||||||||||
Stock | TAIWANJ PHARMACEUTICALS CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 582 | 4,219 | 0.85 | 4,219 | None | ||||||||||
Stock | POWERTEC ENERGY CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 9,930 | 38,825 | 0.75 | 38,825 | None | ||||||||||
Stock | FUSHENG PRECISION CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 700 | 112,000 | 0.59 | 112,000 | None | ||||||||||
Stock | QUASER MACHINE TOOLS, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 200 | 11,460 | 0.50 | 11,460 | None | ||||||||||
Stock | FORTEMEDIA, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 21 | 2 | 0.02 | 2 | None | ||||||||||
Fund | TRANSLINK CAPITAL PARTNERS IV, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | 0 | 45,720 | - | 45,720 | None | ||||||||||
Stock-Preferred Stock | EJOULE INTERNATIONAL LIMITED | - | Financial assets at fair value through profit or loss, noncurrent | 23,909 | 182,880 | - | 182,880 | None | ||||||||||
Stock-Preferred Stock | FLOADIA CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 2 | 84,210 | - | 84,210 | None | ||||||||||
Stock-Preferred Stock | CEREBREX, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 1 | 55,860 | - | 55,860 | None | ||||||||||
Stock-Preferred Stock | FORTEMEDIA, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 311 | 430 | - | 430 | None | ||||||||||
Stock | SHIN-ETSU HANDOTAI TAIWAN CO., LTD. | - | Financial assets at fair value through other comprehensive income, noncurrent | 10,500 | 644,595 | 7.00 | 644,595 | None | ||||||||||
Stock | UNITED MICROELECTRONICS CORP. | Parent company | Financial assets at fair value through other comprehensive income, noncurrent | 16,079 | 259,672 | 0.13 | 259,672 | None | ||||||||||
TLC CAPITAL CO., LTD. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Fund | EVERYI CAPITAL ASIA FUND, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | $109,081 | 18.18 | $109,081 | None | ||||||||||
Stock | WINKING ENTERTAINMENT LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 6,433 | 211,749 | 17.53 | 211,749 | None | ||||||||||
Stock | BEAUTY ESSENTIALS INTERNATIONAL LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 150,500 | 128,443 | 13.99 | 128,443 | None | ||||||||||
Fund | OAK HILL OPPORTUNITIES FUND, SEGREGATED PORTFOLIO | - | Financial assets at fair value through profit or loss, noncurrent | 9 | 261,913 | 9.00 | 261,913 | None | ||||||||||
Stock | ACTI CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 2,252 | 13,217 | 6.08 | 13,217 | None | ||||||||||
Stock | EXCELLENCE OPTOELECTRONICS INC. | - | Financial assets at fair value through profit or loss, noncurrent | 8,529 | 146,700 | 4.98 | 146,700 | None | ||||||||||
Stock | EVERGLORY RESOURCE TECHNOLOGY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 1,200 | 8,820 | 4.91 | 8,820 | None | ||||||||||
Stock | ADVANCE MATERIALS CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 6,039 | 33,575 | 4.39 | 33,575 | None | ||||||||||
Fund | TRANSLINK CAPITAL PARTNERS III, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | 167,168 | 4.24 | 167,168 | None | ||||||||||
ATTACHMENT 4 (Securities held as of September 30, 2018) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
TLC CAPITAL CO., LTD. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | SUNDIA MEDITECH GROUP | - | Financial assets at fair value through profit or loss, noncurrent | 779 | $11,729 | 3.23 | $11,729 | None | ||||||||||
Stock | WIESON TECHNOLOGIES CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 1,829 | 8,960 | 2.74 | 8,960 | None | ||||||||||
Fund | H&QAP GREATER CHINA GROWTH FUND, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | 9,916 | 2.67 | 9,916 | None | ||||||||||
Stock | ALL-STARS XMI LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 6 | 172,799 | 1.17 | 172,799 | None | ||||||||||
Stock | SIMPLO TECHNOLOGY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 1,422 | 298,010 | 0.77 | 298,010 | None | ||||||||||
Stock | TXC CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 1,978 | 67,647 | 0.64 | 67,647 | None | ||||||||||
Stock | POWERTEC ENERGY CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 6,470 | 25,297 | 0.49 | 25,297 | None | ||||||||||
Convertible bonds | DAFENG TV LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 1,700 | 176,375 | - | 176,375 | None | ||||||||||
Stock-Preferred stock | YOUJIA GROUP LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 2,685 | 49,609 | - | 49,609 | None | ||||||||||
Stock-Preferred stock | ALO7 LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 2,377 | 230,879 | - | 230,879 | None | ||||||||||
Stock-Preferred stock | ADWO MEDIA HOLDINGS LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 5,332 | - | - | - | None | ||||||||||
Stock-Preferred stock | IMO, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 8,519 | - | - | - | None | ||||||||||
Stock-Preferred stock | HIGHLANDER FINANCIAL GROUP CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 26,499 | 188,684 | - | 188,684 | None | ||||||||||
Stock-Preferred stock | X2 POWER TECHNOLOGIES LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 35,819 | 128,659 | - | 128,659 | None | ||||||||||
Stock-Preferred stock | GAME VIDEO LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 279 | 83,892 | - | 83,892 | None | ||||||||||
Stock-Preferred stock | CLOUD MOMENT (CAYMAN) INC. | - | Financial assets at fair value through profit or loss, noncurrent | 359 | 15,854 | - | 15,854 | None | ||||||||||
Stock-Preferred stock | PLAYNITRIDE INC. | - | Financial assets at fair value through profit or loss, noncurrent | 1,739 | 145,927 | - | 145,927 | None | ||||||||||
Stock-Preferred stock | EJOULE INTERNATIONAL LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 35,863 | 274,320 | - | 274,320 | None | ||||||||||
Stock-Preferred stock | TURNING POINT LASERS LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 2,000 | 60,960 | - | 60,960 | None | ||||||||||
UMC CAPITAL CORP. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Convertible bonds | SWIFTSTACK, INC. | - | Financial assets at fair value through profit or loss, current | - | USD | 792 | - | USD | 792 | None | ||||||||
Convertible bonds | CLOUDWORDS, INC. | - | Financial assets at fair value through profit or loss, current | - | USD | 190 | - | USD | 190 | None | ||||||||
Convertible bonds | GLYMPSE, INC. | - | Financial assets at fair value through profit or loss, noncurrent | - | USD | 573 | - | USD | 573 | None | ||||||||
Capital | TRANSLINK MANAGEMENT III, L.L.C. | - | Financial assets at fair value through profit or loss, noncurrent | - | USD | 637 | 14.33 | USD | 637 | None | ||||||||
Fund | TRANSLINK CAPITAL PARTNERS IV, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | USD | 4,138 | 11.70 | USD | 4,138 | None | ||||||||
ATTACHMENT 4 (Securities held as of September 30, 2018) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
UMC CAPITAL CORP. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Fund | TRANSLINK CAPITAL PARTNERS III, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | USD | 14,828 | 11.47 | USD | 14,828 | None | ||||||||
Stock | OCTTASIA INVESTMENT HOLDING INC. | - | Financial assets at fair value through profit or loss, noncurrent | 7,035 | USD | 7,246 | 9.76 | USD | 7,246 | None | ||||||||
Stock | ALL-STARS SP IV LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 7 | USD | 7,296 | 5.03 | USD | 7,296 | None | ||||||||
Fund | TRANSLINK CAPITAL PARTNERS II, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | USD | 1,920 | 4.53 | USD | 1,920 | None | ||||||||
Fund | OAK HILL OPPORTUNITIES FUND, SEGREGATED PORTFOLIO | - | Financial assets at fair value through profit or loss, noncurrent | 4 | USD | 3,819 | 4.00 | USD | 3,819 | None | ||||||||
Fund | SIERRA VENTURES XI, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | USD | 1,534 | 1.76 | USD | 1,534 | None | ||||||||
Fund | STORM VENTURES FUND V, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | USD | 2,626 | 1.69 | USD | 2,626 | None | ||||||||
Stock | ALL-STARS XMI LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 7 | USD | 6,614 | 1.37 | USD | 6,614 | None | ||||||||
Stock | ACHIEVE MADE INTERNATIONAL LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 80 | USD | 47 | 0.57 | USD | 47 | None | ||||||||
Stock | CIPHERMAX, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 95 | - | - | - | None | ||||||||||
Stock-Preferred stock | ACHIEVE MADE INTERNATIONAL LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 2,644 | USD | 4,683 | - | USD | 4,683 | None | ||||||||
Stock-Preferred stock | CNEX LABS, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 3,052 | USD | 10,924 | - | USD | 10,924 | None | ||||||||
Stock-Preferred stock | GLYMPSE, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 1,349 | USD | 1,699 | - | USD | 1,699 | None | ||||||||
Stock-Preferred stock | ATSCALE, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 6,255 | USD | 8,066 | - | USD | 8,066 | None | ||||||||
Stock-Preferred stock | INEDA SYSTEMS, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 18,419 | USD | 5,045 | - | USD | 5,045 | None | ||||||||
Stock-Preferred stock | SENSIFREE LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 276 | USD | 487 | - | USD | 487 | None | ||||||||
Stock-Preferred stock | APPIER HOLDINGS, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 52 | USD | 2,115 | - | USD | 2,115 | None | ||||||||
Stock-Preferred stock | DCARD HOLDINGS LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 27,819 | USD | 4,247 | - | USD | 4,247 | None | ||||||||
Stock-Preferred stock | NEXTINPUT, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 3,866 | USD | 1,325 | - | USD | 1,325 | None | ||||||||
Stock-Preferred stock | SHOCARD, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 517 | USD | 424 | - | USD | 424 | None | ||||||||
Stock-Preferred stock | GCT SEMICONDUCTOR, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 175 | USD | 52 | - | USD | 52 | None | ||||||||
Stock-Preferred stock | FORTEMEDIA, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 12,241 | USD | 2,897 | - | USD | 2,897 | None | ||||||||
Stock-Preferred stock | SIFOTONICS TECHNOLOGIES CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 3,500 | USD | 6,889 | - | USD | 6,889 | None | ||||||||
Stock-Preferred stock | NEVO ENERGY, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 4,980 | - | - | - | None | ||||||||||
Stock-Preferred stock | TRILLIANT HOLDINGS, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 4,000 | USD | 5,781 | - | USD | 5,781 | None | ||||||||
ATTACHMENT 4 (Securities held as of September 30, 2018) (Excluding subsidiaries, associates and joint ventures) | ||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||
UMC CAPITAL CORP. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock-Preferred stock | SWIFTSTACK, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 2,855 | USD | 1,763 | - | USD | 1,763 | None | ||||||||
Stock-Preferred stock | NEXENTA SYSTEMS, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 6,555 | USD | 159 | - | USD | 159 | None | ||||||||
Stock-Preferred stock | CLOUDWORDS, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 9,461 | USD | 4,501 | - | USD | 4,501 | None | ||||||||
Stock-Preferred stock | ZYLOGIC SEMICONDUCTOR CORP. | - | Financial assets at fair value through profit or loss, noncurrent | 750 | - | - | - | None | ||||||||||
Stock-Preferred stock | WISAIR, INC. | - | Financial assets at fair value through profit or loss, noncurrent | 173 | - | - | - | None | ||||||||||
Stock-Preferred stock | EAST VISION TECHNOLOGY LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 2,770 | - | - | - | None | ||||||||||
Stock-Preferred stock | SENSIFREE LTD. | - | Prepayments for investments | - | USD | 565 | - | NA | None | |||||||||
TERA ENERGY DEVELOPMENT CO., LTD. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | TIAN TAI PHOTOELECTRICITY CO., LTD. | - | Financial assets at fair value through profit or loss, noncurrent | 375 | $3,750 | 1.18 | $3,750 | None | ||||||||||
NEXPOWER TECHNOLOGY CORP. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Stock | PACIFIC-GREEN INTEGRATED TECHNOLOGY INC. | - | Financial assets at fair value through profit or loss, noncurrent | 54 | $- | 18.00 | $- | None | ||||||||||
SINO PARAGON LIMITED | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ | Shares as collateral | ||||||||||
Fund | SPARKLABS GLOBAL VENTURES FUND I, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | $83,813 | 11.13 | $83,813 | None | ||||||||||
Fund | SPARKLABS KOREA FUND II, L.P. | - | Financial assets at fair value through profit or loss, noncurrent | - | 32,711 | 9.94 | 32,711 | None | ||||||||||
UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | ||||||||||||||||||
September 30, 2018 | ||||||||||||||||||
Type of securities | Name of securities | Relationship | Financial statement account | Units (thousand)/ bonds/ shares (thousand) | Carrying amount | Percentage of ownership (%) | Fair value/ Net assets value | Shares as collateral (thousand) | ||||||||||
Fund | LANHOR FUND | - | Financial assets at fair value through profit or loss, noncurrent | - | RMB | 49,734 | 9.71 | RMB | 49,734 | None |
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 nine-month period ended September 30, 2018) | |||||||||||||||||||||||||||||||||||
(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 | GREEN EARTH LIMITED | Investments accounted for under the equity method | Purchase of newly issued shares | Subsidaries | 420,000 | $9,243,073 | 557,000 | $16,689,894 |
| - | $- | $- | $- | 977,000 | $18,806,169 | ||||||||||||||||||||
Stock | TRIKNIGHT CAPITAL CORPORATION | Investments accounted for under the equity method | Purchase of newly issued shares | Associate | 84,000 | 894,809 | 84,000 | 840,000 | - | - | - | - | 168,000 | 1,562,617 | |||||||||||||||||||||
Note 1 : The amounts of beginning and ending balances of investments accounted for under the equity method include adjustments under the equity method. | |||||||||||||||||||||||||||||||||||
Note 2 : The ending balance includes share of loss of associates and joint ventures of $(3,727,365) thousand, retained earnings adjustment under equity method of $(2,155,223) thousand and exchange differences on translation offoreign operations adjustment under equity method of $(1,244,210) thousand. | |||||||||||||||||||||||||||||||||||
Note 3 : The ending balance includes share of loss of associates and joint ventures of $(158,192) thousand,and cash dividends $(14,000)thousand . | |||||||||||||||||||||||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | |||||||||||||||||||||||||||||||||||
Type of securities | Name of the securities | Financial statement account | Counter-party | Relationship | Beginning balance | Addition(Note 3) | Disposal | Ending balance | |||||||||||||||||||||||||||
Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Units (thousand)/ bonds/ | Amount | Cost | Gain (Loss) | Units (thousand)/ bonds/ | Amount | ||||||||||||||||||||||||||
Stock | MOTECH INDUSTRIES, INC. | Financial assets at fair value through profit or loss, noncurrent | Open market | - | - | $- | 21,998 | $338,776 | 21,998 | $300,414 | $338,776 | $(38,362) | - | $- | |||||||||||||||||||||
Note 1 : The amounts of beginning and ending balances of financial assets at fair value through profit or loss, noncurrent are recorded at the prevailing market prices. | |||||||||||||||||||||||||||||||||||
Note 2 : The disposal cost represents historical cost. | |||||||||||||||||||||||||||||||||||
Note 3 : As of July 1, 2018, UMC NEW BUSINESS INVESTMENT CORP. was merged with FORTUNE VENTURE CAPITAL CORP. (FORTUNE) and FORTUNE is the surviving company. FORTUNE get the stock of MOTECH INDUSTRIES, INC. from merging. | |||||||||||||||||||||||||||||||||||
GREEN EARTH LIMITED | |||||||||||||||||||||||||||||||||||
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 MICROCHIP CORPORATION | Investments accounted for under the equity method | Purchase of newly issued shares | Subsidaries | 410,050 |
| $9,008,924 | 564,000 | $16,896,828 | - | $- | $- | $- | 974,050 | $18,779,499 | ||||||||||||||||||||
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 loss of associates and joint ventures of $(3,726,820) thousand, retained earnings adjustment under equity method of $(2,155,223) thousand and exchange differences on translation offoreign operations adjustment under equity method of $(1,244,210) thousand. | |||||||||||||||||||||||||||||||||||
UNITED MICROCHIP 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 | ||||||||||||||||||||||||||
Capital | UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | Investments accounted for under the equity method | Purchase of newly issued shares | Associate | - | $8,807,847 | - | $16,825,071 | - | $- | $- | $- | - | $18,501,682 | |||||||||||||||||||||
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 loss of associates and joint ventures of $(3,731,803) thousand, retained earnings adjustment under equity method of $(2,155,223) thousand and exchange differences on translation offoreign operations adjustment under equity method of $(1,244,210) thousand. | |||||||||||||||||||||||||||||||||||
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 nine-month period ended September 30, 2018) | ||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||||||||
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 | ||||||||||||
None | ||||||||||||||||||||||||
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 nine-month period ended September 30, 2018) | ||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | ||||||||||||||||||||||
Names of properties | Transaction date | Date of original acquisition | Carrying amount | Transaction amount | Status of proceeds collection | Gain (Loss) from disposal | Counter-party | Relationship | Reason of disposal | Price reference | Other commitments | |||||||||||
None | ||||||||||||||||||||||
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 nine-month period ended September 30, 2018) | |||||||||||||||||||||||||
(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 | $43,416,250 | 43 | % | Net 60 days | N/A | N/A | $6,928,503 | 30 | % | ||||||||||||||
UMC GROUP JAPAN | Subsidiary | Sales | 3,046,577 | 3 | % | Net 60 days | N/A | N/A | 732,362 | 3 | % | ||||||||||||||
UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | Subsidiary | Sales | 1,036,687 | 1 | % | Net 30 days | N/A | N/A | 24,661 | 0 | % | ||||||||||||||
FARADAY TECHNOLOGY CORPORATION | Associate | Sales | 667,897 | 1 | % | Month-end 60 days | N/A | N/A | 168,706 | 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 CORPORATION | Parent company | Purchases | USD | 1,414,443 | 98 | % | Net 60 days | N/A | N/A | USD | 227,313 | 98 | % | ||||||||||||
UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | Associate | Purchases | USD | 15,138 | 1 | % | Net 60 days | N/A | N/A | USD | 2,898 | 1 | % | ||||||||||||
HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | Associate | Purchases | USD | 8,227 | 1 | % | Net 60 days | N/A | N/A | USD | 1,278 | 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 CORPORATION | Parent company | Purchases | JPY | 10,742,790 | 94 | % | Net 60 days | N/A | N/A | JPY | 2,729,326 | 94 | % | ||||||||||||
HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | Associate | Purchases | JPY | 633,220 | 6 | % | Net 60 days | N/A | N/A | JPY | 183,805 | 6 | % | ||||||||||||
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 | RMB | 53,239 | 3 | % | Net 60 days | N/A | N/A | RMB | 8,792 | 2 | % | ||||||||||||
FARADAY TECHNOLOGY CORPORATION | Associate | Sales | RMB | 47,452 | 3 | % | Net 45 days | N/A | N/A | RMB | 20,955 | 6 | % | ||||||||||||
UMC GROUP JAPAN | Associate | Sales | RMB | 39,276 | 2 | % | Net 60 days | N/A | N/A | RMB | 11,133 | 3 | % | ||||||||||||
UNITED SEMICONDUCTOR (XIAMEN) 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 | RMB | 105,263 | 8 | % | Net 60 days | N/A | N/A | RMB | 19,936 | 8 | % |
ATTACHMENT 9 (Receivables from related parties with amounts exceeding the lower of NT$100 million or 20 percent of capital stock as of September 30, 2018) | ||||||||||||||||||||||
(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 | Loss allowance | ||||||||||||||||||
Counter-party | Relationship | Notes receivable |
| Accounts |
| Other receivables |
| Total | Amount |
| Collection status | |||||||||||
UMC GROUP (USA) | Subsidiary | $- | $6,928,503 | $10 | $6,928,513 | 8.47 | $- | Collection in | $3,100,793 | $- | ||||||||||||
UMC GROUP JAPAN | Subsidiary | - | 732,362 | - | 732,362 | 5.84 | 67,214 | Collection in | - | - | ||||||||||||
UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | Subsidiary | - | 24,661 | 23,319 | 47,980 | 0.57 | 32,700 | Collection in | - | - | ||||||||||||
FARADAY TECHNOLOGY CORPORATION | Associate | - | 168,706 | 93 | 168,799 | 7.71 | - | Collection in | 19,697 | - | ||||||||||||
ATTACHMENT 10 (Names, locations and related information of investee companies as of September 30, 2018) (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 September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
UMC GROUP (USA) | USA | IC Sales | USD | 16,438 | USD | 16,438 | 16,438 | 100.00 | $1,731,626 | $78,141 | $78,141 | ||||||||||||||
UNITED MICROELECTRONICS (EUROPE) B.V. | The Netherlands | Marketing support activities | USD | 5,421 | USD | 5,421 | 9 | 100.00 | 140,833 | 1,886 | 1,886 | ||||||||||||||
UMC CAPITAL CORP. | Cayman Islands | Investment holding | USD | 81,500 | USD | 81,500 | 71,663 | 100.00 | 3,761,830 | 168,410 | 162,351 | ||||||||||||||
GREEN EARTH LIMITED | Samoa | Investment holding | USD | 977,000 | USD | 420,000 | 977,000 | 100.00 | 18,806,169 | (3,727,365) | (3,727,365) | ||||||||||||||
TLC CAPITAL CO., LTD. | Taipei City, Taiwan | Venture capital | 4,610,000 | 5,450,000 | 387,600 | 100.00 | 4,295,875 | 27,591 | 27,591 | ||||||||||||||||
UMC NEW BUSINESS INVESTMENT CORP. | Taipei City, Taiwan | Investment holding | - | 5,900,000 | - | - | - | (218,697) | (218,697) | Note | |||||||||||||||
UMC INVESTMENT (SAMOA) LIMITED | Samoa | Investment holding | USD | 1,520 | USD | 1,520 | 1,520 | 100.00 | 42,589 | 213 | 213 | ||||||||||||||
FORTUNE VENTURE CAPITAL CORP. | Taipei City, Taiwan | Consulting and planning for venture capital | 4,160,053 | 4,160,053 | 462,000 | 100.00 | 5,388,782 | (353,767) | (365,209) | ||||||||||||||||
UMC GROUP JAPAN | Japan | IC Sales | JPY | 60,000 | JPY | 60,000 | 1 | 100.00 | 248,795 | 22,503 | 22,503 | ||||||||||||||
UMC KOREA CO., LTD. | Korea | Marketing support activities | KRW | 550,000 | KRW | 550,000 | 110 | 100.00 | 20,390 | 851 | 851 | ||||||||||||||
OMNI GLOBAL LIMITED | Samoa | Investment holding | USD | 4,300 | USD | 4,300 | 4,300 | 100.00 | 569,182 | 37,003 | 37,003 | ||||||||||||||
SINO PARAGON LIMITED | Samoa | Investment holding | USD | 2,600 | USD | 2,600 | 2,600 | 100.00 | 119,530 | 13,071 | 13,071 | ||||||||||||||
BEST ELITE INTERNATIONAL LIMITED | British Virgin Islands | Investment holding | USD | 309,102 | USD | 309,102 | 664,966 | 100.00 | 22,744,021 | 191,274 | 182,097 | ||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION | Hsinchu County, Taiwan | Sales and manufacturing of integrated circuits | 1,707,482 | 1,707,482 | 126,230 | 77.74 | 353,206 | (195,273) | (151,803) | ||||||||||||||||
MTIC HOLDINGS PTE. LTD. | Singapore | Investment holding | SGD | 12,000 | SGD | 12,000 | 12,000 | 45.44 | 69,173 | (6,044) | 216,324 | ||||||||||||||
NEXPOWER TECHNOLOGY CORP. | Taichung City, Taiwan | Sales and manufacturing of solar power batteries | 5,956,791 | 5,777,225 | 33,998 | 47.75 | 107,952 | (239,429) | (106,824) | ||||||||||||||||
UNITECH CAPITAL INC. | British Virgin Islands | Investment holding | USD | 21,000 | USD | 21,000 | 21,000 | 42.00 | 651,276 | (232,485) | (97,644) | ||||||||||||||
TRIKNIGHT CAPITAL CORPORATION | Taipei City, Taiwan | Investment holding | 1,680,000 | 840,000 | 168,000 | 40.00 | 1,562,617 | (395,480) | (158,192) | ||||||||||||||||
HSUN CHIEH INVESTMENT CO., LTD. | Taipei City, Taiwan | Investment holding | 336,241 | 336,241 | 168,973 | 36.49 | 4,447,493 | 1,412,373 | 514,938 | ||||||||||||||||
YANN YUAN INVESTMENT CO., LTD. | Taipei City, Taiwan | Investment holding | 2,300,000 | 2,300,000 | 46,000 | 30.87 | 2,967,495 | 290,355 | 89,640 | ||||||||||||||||
FARADAY TECHNOLOGY CORPORATION | Hsinchu City, Taiwan | Design of application-specific integrated circuit | 38,918 | 38,918 | 34,240 | 13.78 | 1,514,149 | (332,986) | (45,872) | ||||||||||||||||
Note:As of July 1, 2018, UMC NEW BUSINESS INVESTMENT CORP. was merged with FORTUNE VENTURE CAPITAL CORP.(FORTUNE) and FORTUNE is the surviving company. |
ATTACHMENT 10 (Names, locations and related information of investee companies as of September 30, 2018) (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 September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
TERA ENERGY DEVELOPMENT CO., LTD. | Hsinchu City, Taiwan | Energy Technical Services | $100,752 | $- | 18,655 | 100.00 | $82,050 | $2,539 | $(698) | Note | |||||||||||||||
UNISTARS CORPORATION | Hsinchu County, Taiwan | High brightness LED packages | 606,980 | - | 46,168 | 83.69 | 51,429 | (32,007) | (8,033) | Note | |||||||||||||||
NEXPOWER TECHNOLOGY CORP. | Taichung City, Taiwan | Sales and manufacturing of solar power batteries | 1,688,630 | 1,578,630 | 23,827 | 33.46 | 75,655 | (239,429) | (84,426) | ||||||||||||||||
WINAICO IMMOBILIEN GMBH | Germany | Solar project | EUR | 5,900 | EUR | - | 5,900 | 32.78 | - | (384,658) | - | Note | |||||||||||||
UNITED LED CORPORATION HONG KONG LIMITED | Hongkong | Investment holding | USD | 22,500 | USD | - | 22,500 | 25.14 | 177,562 | (136,803) | (11,147) | Note | |||||||||||||
CLIENTRON CORP. | Xinbei City, Taiwan | Thin client | 283,439 | 308,580 | 14,247 | 22.39 | 245,969 | 76,526 | 15,365 | ||||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION | Hsinchu County, Taiwan | Sales and manufacturing of integrated circuits | 8,856 | 8,856 | 1,194 | 0.73 | 5,299 | (195,273) | (1,436) | ||||||||||||||||
Note:As of July 1, 2018, UMC NEW BUSINESS INVESTMENT CORP. was merged with FORTUNE VENTURE CAPITAL CORP.(FORTUNE) and FORTUNE is the surviving company. |
TLC CAPITAL CO., LTD. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
SOARING CAPITAL CORP. | Samoa | Investment holding | USD | 900 | USD | 900 | 900 | 100.00 | $16,668 | $764 | $764 | ||||||||||||||
YUNG LI INVESTMENTS, INC. | Taipei City, Taiwan | Investment holding | 59,125 | 59,125 | 5,913 | 45.16 | 36,385 | (12,037) | (5,436) | ||||||||||||||||
HSUN CHIEH CAPITAL CORP. | Samoa | Investment holding | USD | 6,000 | USD | 6,000 | 6,000 | 30.00 | 173,367 | (26,203) | (7,861) | ||||||||||||||
VSENSE CO., LTD. | Taipei City, Taiwan | Medical devices, measuring equipment, reagents and consumables | 95,916 | 95,916 | 4,251 | 28.63 | 72,987 | (18,706) | (5,355) | ||||||||||||||||
NEXPOWER TECHNOLOGY CORP. | Taichung City, Taiwan | Sales and manufacturing of solar power batteries | 888,019 | 828,019 | 8,645 | 12.14 | 27,451 | (239,429) | (18,510) | ||||||||||||||||
UMC CAPITAL CORP. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
UMC CAPITAL (USA) | USA | Investment holding | USD | 200 | USD | 200 | 200 | 100.00 | USD | 545 | USD | 9 | USD | 9 | |||||||||||
TRANSLINK CAPITAL PARTNERS I, L.P. | Cayman Islands | Investment holding | USD | 4,036 | USD | 4,036 | - | 10.38 | USD | 3,624 | USD | (475) | USD | (39) | |||||||||||
ATTACHMENT 10 (Names, locations and related information of investee companies as of September 30, 2018) (Not including investment in Mainland China) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
UMC NEW BUSINESS INVESTMENT CORP.(Note) | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
TERA ENERGY DEVELOPMENT CO., LTD. | Hsinchu City, Taiwan | Energy Technical Services | $- | $190,752 | - | - | $- | $2,539 | $3,237 | ||||||||||||||||
UNISTARS CORPORATION | Hsinchu County, Taiwan | High brightness LED packages | - | 606,980 | - | - | - | (32,007) | (18,916) | ||||||||||||||||
WINAICO IMMOBILIEN GMBH | Germany | Solar project | EUR | - | EUR | 5,900 | - | - | - | (384,658) | - | ||||||||||||||
UNITED LED CORPORATION HONG KONG LIMITED | Hongkong | Investment holding | USD | - | USD | 22,500 | - | - | - | (136,803) | (23,244) | ||||||||||||||
Note:As of July 1, 2018, UMC NEW BUSINESS INVESTMENT CORP. was merged with FORTUNE VENTURE CAPITAL CORP.(FORTUNE) and FORTUNE is the surviving company. | |||||||||||||||||||||||||
TERA ENERGY DEVELOPMENT CO., LTD. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
EVERRICH ENERGY INVESTMENT (HK) LIMITED | Hongkong | Investment holding | USD | 1,092 | USD | 1,092 | 1,092 | 100.00 | $44,539 | $5,056 | $5,056 | ||||||||||||||
WINAICO SOLAR PROJEKT 1 GMBH | Germany | Solar project | EUR | 1,120 | EUR | 1,120 | 1,120 | 50.00 | - | (46,991) | - | ||||||||||||||
WINAICO IMMOBILIEN GMBH | Germany | Solar project | EUR | 2,160 | EUR | 2,160 | 2,160 | 12.00 | - | (384,658) | - | ||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
WAVETEK MICROELECTRONICS INVESTMENT (SAMOA) LIMITED | Samoa | Investment holding | USD | 1,200 | USD | 1,200 | 1,200 | 100.00 | $1,792 | $(5,284) | $(5,284) | ||||||||||||||
WAVETEK MICROELECTRONICS INVESTMENT (SAMOA) LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
WAVETEK MICROELECTRONICS CORPORATION (USA) | USA | Sales and marketing service | USD | 60 | USD | 60 | 60 | 100.00 | $2,532 | $141 | $141 | ||||||||||||||
NEXPOWER TECHNOLOGY CORP. | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
SOCIALNEX ITALIA 1 S.R.L. | Italy | Photovoltaic power plant | EUR | 3,637 | EUR | 3,637 | - | 100.00 | $126,302 | $1,289 | $1,289 | ||||||||||||||
ATTACHMENT 10 (Names, locations and related information of investee companies as of September 30, 2018) (Not including investment in Mainland China) | |||||||||||||||||||||||||
(Amount in thousand; Currency denomination in NTD or in foreign currencies) | |||||||||||||||||||||||||
BEST ELITE INTERNATIONAL LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
INFOSHINE TECHNOLOGY LIMITED | British Virgin Islands | Investment holding | USD | 354,000 | USD | 354,000 | - | 100.00 | $23,082,214 | $195,344 | $195,344 | ||||||||||||||
INFOSHINE TECHNOLOGY LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
OAKWOOD ASSOCIATES LIMITED | British Virgin Islands | Investment holding | USD | 354,000 | USD | 354,000 | - | 100.00 | $23,082,214 | $195,344 | $195,344 | ||||||||||||||
OMNI GLOBAL LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
UNITED MICROTECHNOLOGY CORPORATION (NEW YORK) | USA | Research & Development | USD | 950 | USD | 950 | 0 | 100.00 | $30,662 | $(56) | $(56) | ||||||||||||||
UNITED MICROTECHNOLOGY CORPORATION (CALIFORNIA) | USA | Research & Development | USD | 1,000 | USD | 1,000 | 0 | 100.00 | 33,776 | 1,964 | 1,964 | ||||||||||||||
ECP VITA PTE. LTD. | Singapore | Insurance | USD | 9,000 | USD | 9,000 | 9,000 | 100.00 | 510,292 | 35,633 | 35,633 | ||||||||||||||
UMC TECHNOLOGY JAPAN CO., LTD. | Japan | Semiconductor manufacturing technology development and consulting services | JPY | 35,000 | JPY | 35,000 | 4 | 100.00 | 8,875 | (185) | (185) | ||||||||||||||
GREEN EARTH LIMITED | |||||||||||||||||||||||||
Investee company | Address | Main businesses and products | Initial Investment | Investment as of September 30, 2018 | Net income (loss) of investee company | Investment income (loss) recognized | Note | ||||||||||||||||||
Ending balance |
| Beginning balance | Number of shares (thousand) |
| Percentage of ownership |
| Carrying amount | ||||||||||||||||||
UNITED MICROCHIP CORPORATION | Cayman | Investment holding | USD | 974,050 | USD | 410,050 | 974,050 | 100.00 | $18,779,499 | $(3,726,820) | $(3,726,820) |
ATTACHMENT 11 (Investment in Mainland China as of September 30, 2018) | |||||||||||||||||||||||||||||||||||
(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 amount | Accumulated inward remittance of earnings as of | |||||||||||||||||||||||||
Outflow |
| Inflow | Net income (loss) of investee company | ||||||||||||||||||||||||||||||||
UNITRUTH ADVISOR (SHANGHAI) CO., LTD. | Investment Holding and advisory |
| $24,384 | (ii)SOARING CAPITAL CORP. |
| $24,384 | $- | $- |
| $24,384 | $829 | 100.00% | $829 | $16,404 | $- | ||||||||||||||||||||
SHANDONG HUAHONG ENERGY INVEST CO., INC. | Invest new energy business |
| 1,323,900 | (i) |
| 41,453 | - | - |
| 41,453 | (5,549) | - | - | - | - | ||||||||||||||||||||
JINING SUNRICH SOLAR ENERGY CORP. | To construct, operate, and maintain solar power plant |
| 1,235,640 | (iii)SHANDONG HUAHONG ENERGY INVEST CO., INC. |
| 637,946 | - | - |
| 637,946 | (5,296) | - | - | - | - | ||||||||||||||||||||
EVERRICH (SHANDONG) ENERGY CO., LTD. | Solar engineering integrated design services |
| 22,860 | (ii)EVERRICH ENERGY INVESTMENT (HK) LIMITED |
| 22,860 | - | - |
| 22,860 | 5,137 | 100.00% | 5,137 | 33,395 |
| 123,779 | |||||||||||||||||||
UNITED LED CORPORATION | Research, manufacturing and sales in LED epitaxial wafers |
| 2,560,320 | (ii)UNITED LED CORPORATION HONG KONG LIMITED |
| 617,220 | - | - |
| 617,220 |
| (131,525) | 25.14% |
| (33,067) |
| 169,428 | - | |||||||||||||||||
HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | Sales and manufacturing of integrated circuits |
| 14,143,727 | (ii)OAKWOOD ASSOCIATES LIMITED |
| 9,421,429 | - | - |
| 9,421,429 |
| 176,763 | 98.14% |
| 170,704 |
| 21,909,852 | - | |||||||||||||||||
UMC (BEIJING) LIMITED | Marketing support activities | - | (ii)UMC INVESTMENT |
| 15,240 | - | - |
| 15,240 | (424) | - | (424) | - | - | |||||||||||||||||||||
UNITEDDS SEMICONDUCTOR (SHANDONG) CO., LTD. | Design support of integrated circuits |
| 132,390 | (iii)HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. | - | - | - | - |
| 1,169 | 98.14% |
| 1,421 |
| 176,577 | - | |||||||||||||||||||
UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. | Sales and manufacturing of integrated circuits |
| 56,035,365 | (ii)UNITED MICROCHIP CORPORATION and (iii)HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. |
| 12,291,609 |
| 17,120,555 | - |
| 29,412,164 |
| (7,766,549) | 64.95% |
| (4,797,456) |
| 24,148,673 | - | ||||||||||||||||
Accumulated investment in Mainland China as of | Investment amounts authorized by Investment Commission, MOEA | Upper limit on investment | |||||||||||||||||||||||||||||||||
$40,192,696 | $51,475,142 | $127,238,835 | |||||||||||||||||||||||||||||||||
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: | ||||||||||||||||||||||||||||||||||
The investment income (loss) were determined based on the following basis: | |||||||||||||||||||||||||||||||||||
(i) The financial report was reviewed by an international certified public accounting firm in cooperation with an R.O.C. accounting firm. | |||||||||||||||||||||||||||||||||||
(ii) The financial statements were reviewed by the auditors of the parent company. | |||||||||||||||||||||||||||||||||||
(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, an equity investee. The investment has been approved by the Investment Commission, MOEA | ||||||||||||||||||||||||||||||||||
in the total amount of US$383,569 thousand. As of September 30, 2018, the amount of investment has been all remitted. | |||||||||||||||||||||||||||||||||||
Note 5 : | The investment to UNITED SEMICONDUCTOR (XIAMEN) CO., LTD. (USCXM) from HEJIAN TECHNOLOGY (SUZHOU) CO., LTD. and indirectly invested in USCXM via investment in GREEN EARTH LIMITED. | ||||||||||||||||||||||||||||||||||
The consent to invest in USCXM's investment has been approved by the Investment Commission, MOEA in the total amount of US$1,260,658 thousand. As of September 30, 2018, the amount of investment US$1,222,356 thousand has been remitted. | |||||||||||||||||||||||||||||||||||
Note 6 : | The liquidation of UMC (BEIJING) LIMITED was completed as of June 20, 2018. |