聯華電子 (UMC) 2014 Q1 法說會逐字稿

Welcome everyone to UMC's 2014 First Quarter Earnings Conference Call.

歡迎大家參加聯華電子 2014 年第一季獲利電話會議。

All lines have been placed on mute to prevent background noise.

所有線路均已靜音，以防止背景噪音。

After the presentation, there will be a question-and-answer session.

演講結束後，將進行問答環節。

Please follow the instructions given at that time, if you would like to ask a question.

如果您想提問，請按照當時給出的說明進行操作。

For your information, this conference call is now being broadcasted live over the Internet.

供您參考，本次電話會議現透過網路進行現場直播。

A webcast replay will be available within an hour after the conference is finished.

會議結束後一小時內將提供網路直播重播。

Please visit our website www.umc.com, under the Investor Relations, Investor Events section.

請造訪我們的網站 www.umc.com，位於「投資者關係」、「投資者活動」部分。

And now, I would like to introduce Mr. Bowen Huang, Head of Investor Relations at UMC.

現在，我想介紹一下聯華電子投資者關係主管黃博文先生。

Mr. Huang, you may begin.

黃先生，您可以開始了。

Thank you, and welcome to UMC's conference call for the first quarter of 2014.

謝謝您，歡迎參加聯華電子 2014 年第一季的電話會議。

I am joined by Mr. Po Wen Yen, the CEO of UMC and Mr. Chi Tung Liu, the CFO of UMC.

與我一同出席的還有聯電執行長鮑文彥先生和聯華電子財務長劉志東先生。

In a moment, we will see our CFO present the first quarter financial results, followed by our CEO's key message to address UMC's main area of focus and the UMC's second quarter 2014 guidance.

稍後，我們將看到我們的財務長介紹第一季的財務業績，然後是我們的執行長針對 UMC 主要關注領域的關鍵訊息以及 UMC 2014 年第二季的指導。

Once our CEO and CFO complete their remarks, there will be a Q&A section.

一旦我們的執行長和財務長完成發言，就會有問答部分。

UMC's quarterly financial reports are available at our website www.umc.com, under the Investor Relations, Financial Release section.

UMC 的季度財務報告可在我們的網站 www.umc.com 的投資者關係、財務發布部分查閱。

During this conference call, we will make forward-looking statements based on management's current expectation and beliefs.

在本次電話會議中，我們將根據管理層目前的期望和信念做出前瞻性陳述。

These forward-looking statements are subject to a number of risk and uncertainties that could cause actual results to differ materially, including the risks that may be beyond the Company's control.

這些前瞻性陳述受到許多風險和不確定性的影響，可能導致實際結果出現重大差異，包括可能超出公司控制範圍的風險。

For these risks, please refer to UMC's filings with the SEC in the US and the ROC securities authorities.

對於這些風險，請參閱聯華電子向美國 SEC 和中華民國證券監管機構提交的文件。

I would now like to introduce UMC's CFO, Mr. Chi Tung Liu to discuss UMC's first quarter 2014 business results.

現在我想介紹聯電財務長劉志東先生來討論聯華電子2014年第一季的業績。

Thank you, Bowen.

謝謝你，鮑文。

For the first quarter of 2014, revenue was TWD31.69 billion with a gross margin around 18.6% and operating margin of 3%.

2014年第一季營收為新台幣316.9億元，毛利率約18.6%，營業利益率為3%。

The net income attributable to the stockholders of the parent was TWD1.18 billion and the earnings per ordinary shares were TWD0.09.

歸屬於母公司股東的淨利為新台幣11.8億元，每股普通股收益為新台幣0.09元。

Now, I would like to go through our financial PowerPoint files, which has been posted on our IR website.

現在，我想瀏覽一下我們的財務 PowerPoint 文件，該文件已發佈在我們的 IR 網站上。

If you refer to page 3, you can see that there is the operating results summary.

如果你查看第3頁，你可以看到有運行結果摘要。

For first quarter of 2014, our capacity utilization rate was 81% and the wafer shipment was 1,258 million, 8-inch equivalent wafers.

2014年第一季度，我們的產能利用率為81%，晶圓出貨量為12.58億片8吋等效晶圓。

For the cash on hand, currently it stands around TWD53.9 billion.

目前手頭現金約539億新台幣。

On the following page, we can see a quarter-over-quarter comparison.

在下一頁中，我們可以看到季度環比的比較。

Revenue grow 3.2% to TWD31.69 billion and gross margin was TWD5.9 billion, and operating income is TWD941 million.

營收成長3.2%至新台幣316.9億元，毛利率為新台幣59億元，營業收入為新台幣9.41億元。

And for the net income is TWD1.11 billion so again EPS is TWD0.09 per share.

由於淨利潤為新台幣 11.1 億，因此每股 EPS 為新台幣 0.09 元。

In terms of year-over-year comparison, revenue growth 14.1% and operating -- gross margin rose 31.4% to TWD5.9 billion.

與去年同期相比，營收成長 14.1%，營業毛利率成長 31.4%，達到 59 億新台幣。

And at the same time, operating expenses also grow around 20% to TWD5 billion.

同時，營運費用也成長了 20% 左右，達到 50 億新台幣。

So same time last year, we had this bargain purchase gains in the non-operating item, around TWD7.2 billion and for this year, we don't have that.

去年同一時間，我們在非經營項目中獲得了大約 72 億新台幣的討價還價採購收益，而今年我們沒有了。

So the net income is around TWD1.11 billion.

因此淨利潤約為新台幣11.1億元。

And for balance sheet highlight on page 6. Other than TWD53.9 billion cash, we also have total assets close to $10 billion or TWD301 billion in total assets.

第6頁的資產負債表重點是，除了539億新台幣的現金外，我們還有接近100億美元的總資產，即總資產3,010億新台幣。

On page 7 is the operating segments breakdown.

第 7 頁是營運部門細分。

For our new business, we have reported a better performance in the first quarter of 2014 with a revenue of almost TWD3 billion and the net income loss has narrowed down to TWD219 million.

新業務方面，2014年第一季業績較好，營收近30億新台幣，淨利虧損收窄至2.19億新台幣。

On page 8, our ASP in Q1 declined roughly 3% to 4% in first quarter.

在第 8 頁，我們第一季的平均售價下降了大約 3% 到 4%。

On page 9, in terms of our geographic breakdown, Asia grew to 45% of the total revenue and North America declined to 45% from 47% in the previous quarter.

在第 9 頁，就地理細分而言，亞洲佔總收入的比例增長至 45%，北美則從上一季的 47% 下降至 45%。

On page 10, IDM continued to shrink as a percentage of total revenue.

在第10頁，IDM佔總收入的百分比持續下降。

It's now around 8% of our total sales in Q1 2014.

目前約占我們 2014 年第一季總銷售額的 8% 左右。

Communication is still our largest sales breakdown by application on page 11, which represent around 46% of the total pie and consumer stayed unchanged around 31%.

通訊仍然是第 11 頁上按應用劃分的最大銷售細分，佔總銷售額的 46% 左右，而消費者則保持在 31% 左右不變。

We continued to have expansion in the leading edge revenue pool.

我們繼續擴大領先的收入池。

65 nanometer now is 31% of the total revenue, 2% more than the previous quarter of 29%.

65奈米現在佔總營收的31%，比上一季的29%增加了2個百分點。

And 40 nanometers still stay above 20% in Q1 2014.

而40奈米在2014年第一季仍維持在20%以上。

On page 13, we have quarterly capacity breakdown and we see a mild increase in the first quarter of 2014, partially offset by the fewer working days in February.

在第 13 頁上，我們列出了季度產能明細，我們發現 2014 年第一季產能略有成長，部分被 2 月工作日減少所抵銷。

In quarter two, we will see the capacity increase continue or resume and to [about 1.6 million] wafers per quarter in second quarter of 2014.

在第二季度，我們將看到產能持續增加或恢復，並在 2014 年第二季達到每季約 160 萬片晶圓。

And finally, our capital expenditure plan stay unchanged at current budget of $1.1 billion to $1.3 billion, stay unchanged.

最後，我們的資本支出計畫保持不變，目前預算為 11 億至 13 億美元，保持不變。

And this is the summary of our results for first quarter of 2014 and more details are available in the report, which has been posted on our website.

這是我們 2014 年第一季業績的摘要，更多詳細資訊請參閱我們網站上發布的報告。

I will now turn the call over to Mr. Yen, CEO of UMC.

我現在將電話轉給聯華電子執行長顏先生。

Thank you, Chi Tung.

謝謝你，池東。

Hello, everyone.

大家好。

I would like to update to everyone UMC's first quarter operating results.

我想向大家介紹聯華電子第一季的經營業績。

In the first quarter of 2014, UMC recorded TWD28.71 billion in revenue from the foundry segment with operating margin from foundry operations of 4%.

2014年第一季度，聯華電子代工業務營收達287.1億元新台幣，代工業務利潤率為4%。

Wafer shipments reached [1,258 million] 8-inch equivalent wafers.

晶圓出貨量達到[12.58億]8吋等效晶圓。

In a seasonally quiet quarter, UMC's first quarter of 2014 foundry performance exceeded guidance, driven by continuous chip demand that brought overall capacity utilization to 81%.

在季節性淡季中，聯華電子 2014 年第一季的代工業績超出了預期，這得益於持續的晶片需求，使整體產能利用率達到 81%。

Growth was led by the computing sector.

成長由計算行業帶動。

As a result, contribution from 65 nanometer and below technologies represented 51% of sales, including 20% from 40 nanometer.

因此，65 奈米及以下技術的貢獻佔銷售額的 51%，其中 40 奈米技術佔 20%。

From 28 nanometer, our communication and consumer customers continued to be encouraged by our sustained yield improvement.

從 28 奈米開始，我們的持續良率提高繼續鼓舞我們的通訊和消費客戶。

While the average 28 nanometer yields had strong stable performance, the continuous rise in our peak wafer yields will be a convincing factor for customers to enter pilot production in the coming months.

雖然28奈米平均良率表現強勁，但晶圓峰值良率的持續上升將成為客戶在未來幾個月進入試生產的一個令人信服的因素。

UMC also continues to focus on capturing fast growing opportunities and further expanding our market share in China.

聯華電子也繼續專注於抓住快速成長的機會並進一步擴大我們在中國的市場份額。

Recently, UMC hosted its 2014 China Technology Forum in Shanghai to demonstrate our manufacturing excellence and comprehensive coverage of semiconductor applications.

近日，聯華電子在上海舉辦了2014中國技術論壇，展示我們卓越的製造能力和對半導體應用的全面覆蓋。

With 20 years of pure play foundry experience, our technology leadership in logic and specialty solutions will help us gain additional design wins in the Chinese fabless industry.

憑藉 20 年的純晶圓代工經驗，我們在邏輯和專業解決方案方面的技術領先地位將幫助我們在中國無晶圓廠產業中獲得更多設計勝利。

For the second quarter of 2014, UMC will benefit from the continued growth in semiconductor -- in customer demand, especially from the communication segment.

2014年第二季度，聯華電子將受益於半導體領域客戶需求的持續成長，尤其是通訊領域的需求。

We expect increased wafer shipments and higher capacity utilization rates to drive better profitability.

我們預計晶圓出貨量的增加和產能利用率的提高將推動獲利能力的提高。

At the leading-edge, 40 nanometer demand continues to show strength while 28 nanometer business is gaining momentum.

在前沿，40 奈米需求持續表現強勁，而 28 奈米業務正在蓄勢待發。

We are confident that our engineering team's steady progress in 28 nanometer yield enhancement activities will help UMC to capture key business and achieve strategic goals in the near future.

我們相信，我們的工程團隊在28奈米良率提升活動中的穩步進展將有助於聯華電子在不久的將來抓住關鍵業務並實現戰略目標。

We will continue to execute and take the necessary steps to propel our future growth.

我們將繼續執行並採取必要的步驟來推動我們未來的成長。

In the long run, we will further strengthen our technology solutions and service quality to enhance shareholder returns.

長遠來看，我們將進一步強化技術解決方案與服務質量，提升股東回報。

Now, please allow me sometimes to summarize the recent highlights in Chinese.

現在，請允許我有時用中文總結一下最近的亮點。

(spoken in Chinese).

（用中文說）。

I have finished my remarks, and now let me go over second quarter 2014 guidance.

我的發言已經結束，現在讓我回顧 2014 年第二季的指導。

The foundry segment wafer shipments to show an increase of low-teens percentage range.

代工部門晶圓出貨量顯示出低十幾%的百分比增幅。

Foundry segment ASP in US dollars will remain flat.

代工部門以美元計算的平均售價將維持不變。

UMC's foundry segment's gross profit margin will be in the mid-20% range.

聯華電子代工部門的毛利率將在20%左右。

Capacity utilization rate for foundry segment will be at high-80% range.

代工領域的產能利用率將高達80%。

2014 CapEx for foundry segment will be in the range of $1.1 billion to $1.3 billion.

2014 年代工領域的資本支出將在 11 億美元至 13 億美元之間。

The guidance for new business segment's revenue to be approximately TWD3 billion and operating loss to be approximately [TWD0.05 billion].

新業務部門營收指引約新台幣30億元，營業虧損約[0.5億元新台幣]。

That concludes my comments.

我的評論到此結束。

We are now ready for questions.

我們現在準備好提問了。

Operator, please open the lines up.

接線員，請打開線路。

Thank you.

謝謝。

Thank you.

謝謝。

Ladies and gentlemen, we will now begin our question-and-answer session.

女士們先生們，我們現在開始問答環節。

(Operator Instructions).

（操作員說明）。

Dan Heyler, Bank of America.

丹·海勒，美國銀行。

Thanks, good afternoon gentlemen.

謝謝，先生們下午好。

I had a few housekeeping questions.

我有一些家政問題。

I wanted to ask what's your total capacity -- year-end capacity is expected to be and if you can give out how much of the net capacity is for 28 nanometer?

我想問一下你們的總產能是多少，預計年底產能是多少，能否透露28奈米的淨產能是多少？

Yes, our total capacity for 2014 for 28 nanometer will be increased from 10k per month now to 12k per month in the 4Q 2014 and so far we don't have plan for expanding the capacity strength.

是的，我們2014年28奈米的總產能將從現在的每月1萬片增加到2014年第四季的每月1.2萬片，到目前為止我們還沒有擴大產能強度的計畫。

10k now to, you said, 15k by year end?

你說現在10k到年底15k？

Yes, 12,000 per month in 4Q end of this year.

是的，今年第四季末每月 12,000。

Okay, and when would you expect 28 nanometer to contribute say 3% of sales, when could you achieve the 3 percentage point of sales contribution of 28 nanometer wafer?

好吧，你預期什麼時候28奈米會貢獻3%的銷售額，什麼時候才能達到28奈米晶圓3個百分點的銷售額貢獻？

Yes.

是的。

Our 28 nanometer is progressing well and we expect our 28 nanometer will represent 1% of total sales in 2Q of 2014.

我們的 28 奈米進展順利，我們預計 28 奈米將佔 2014 年第二季總銷售額的 1%。

And then what's the target for the fourth quarter then does that kind of get to 5% by the end of the year then?

那麼第四季的目標是多少，到年底會達到5%嗎？

That would be a reasonable scenario right now.

現在這將是一個合理的情況。

Yes, we also expect to see more than 5% of revenue from 28 nanometers in 4Q 2014.

是的，我們也預期 2014 年第四季將有超過 5% 的收入來自 28 奈米。

Okay, excellent.

好的，非常好。

And then I also want to ask a few questions about 40 nanometer.

然後我還想問幾個關於40奈米的問題。

SMIC has also talked about demand for 40 as they enter that market.

中芯國際也談到了進入該市場時對 40 的需求。

So it looks as well there is increased competition.

所以看起來競爭也越來越激烈。

What do you think the contribution of 40 nanometer should be by year end?

您認為到年底40奈米的貢獻應該是多少？

I guess, right now it's running at about 20% of sales.

我猜，現在它的銷量大約佔銷售額的 20%。

So does that increase the contribution to sales throughout the year, will that increase to less percentage of sales by year end?

那麼，這是否會增加對全年銷售額的貢獻，到年底會減少銷售額的百分比嗎？

Yes, our 40 nanometer revenue contribution will be around 20% in 2Q this year and I would expect it will be around December through the end of this year.

是的，我們的 40 奈米收入貢獻將在今年第二季達到 20% 左右，我預計將在 12 月左右到今年年底。

Okay.

好的。

So it's growing pretty much in line with your overall business.

因此，它的成長與您的整體業務非常一致。

What areas are driving 40 nanometer?

哪些領域正在推動 40 奈米技術的發展？

Is it migration from 65 or are there other new product areas coming in that you're noticing on 40, because again as I said it seems as though there is definitely more competition in that space?

是從 65 遷移而來，還是您注意到 40 上有其他新產品領域出現，因為正如我所說，該領域似乎肯定存在更多競爭？

I'm wondering what's driving the growth there?

我想知道是什麼推動了那裡的成長？

Yes, I think a part of it is a technology transition from 65 to 40 nanometer, but mostly it's we engage more customers' base to gain more business on 40 nanometer worldwide.

是的，我認為其中一部分是從 65 奈米到 40 奈米的技術過渡，但最主要的是我們吸引了更多的客戶群，以在全球範圍內獲得更多 40 奈米業務。

If you are taking some share, what areas do you think you're taking share, which specific segments and products?

如果你正在獲取一些份額，你認為你正在哪些領域中獲取份額，哪些特定的細分市場和產品？

I think it's still the communication and you're talking about specialty, or what is -- mainly on communication and consumer area.

我認為這仍然是溝通，你談論的是專業，或者是什麼——主要是在溝通和消費領域。

Okay.

好的。

Chi Tung, I guess I wanted to get some of the depreciation numbers for the second and third quarters, if you could, what you're anticipating.

Chi Tung，我想我想獲得第二季和第三季的一些折舊數據，如果可以的話，您的預期是多少。

I know you haven't changed CapEx.

我知道你沒有改變資本支出。

I'm just wondering if -- I want to make sure that we have the current numbers for depreciation.

我只是想知道是否 - 我想確保我們擁有當前的折舊數字。

Yes.

是的。

For this year, it's going to be less than [10%] increase for full year.

今年，全年增幅將低於 [10%]。

And quarter one, showed low-single-digit increase over the previous quarter, and then the rest of 2Q, 3Q just linear.

第一季較上一季呈現低個位數成長，然後第二季、第三季的其餘時間只是線性成長。

Okay, maybe just a final observation that there has obviously been a very broad pickup, inventory has been [variable] across the supply chain and every foundry is seeing a pickup for your above seasonal second quarter.

好吧，也許只是最後一個觀察結果，即明顯出現了非常廣泛的回升，整個供應鏈的庫存一直在[變化]，每個代工廠都看到了上述季節性第二季度的回升。

Do you anticipate looking to the third and fourth quarters, should we see things track more seasonality again after above seasonal second quarter?

您是否預計第三季和第四季度，我們是否應該看到在第二季以上季節性之後，事情會再次追蹤更多的季節性？

Or there are certain areas where you think you could grow faster than seasonality and if so what would those drivers be for second half?

或者，您認為在某些領域的成長速度可以快於季節性因素，如果是這樣，下半年的驅動因素是什麼？

We currently do not have enough visibility on our second half of 2014 foundry business.

目前我們對 2014 年下半年的代工業務還沒有足夠的了解。

Okay, thank you.

好的謝謝。

Thank you.

謝謝。

Randy Abrams, Credit Suisse.

蘭迪·艾布拉姆斯，瑞士信貸。

Thank you.

謝謝。

The first question I wanted to ask on the gross margin where you are guiding to mid-20s for second quarter in the foundry and it looks like a few point above where you reached last year, again maybe talk about the mix or some of the factors that look like it's lifting a bit your margins versus what you did last year.

我想問的第一個問題是關於鑄造廠第二季度毛利率為 20 多歲的目標，看起來比去年達到的水平高出幾個點，也許再次談論一下組合或一些因素與去年相比，看起來你的利潤有提高。

Well, the higher the better, right?

嗯，越高越好，對嗎？

Yes, I know it's good news.

是的，我知道這是個好消息。

I think nothing really hit on the parameters.

我認為沒有什麼真正影響參數。

I think same time last year we had some less in 8-inch wafers.

我想去年同期我們的 8 吋晶圓產量有所減少。

We probably are -- so I think, the OpEx number, the operating margins will reflect that and for gross margin, we don't really see any major difference compared to Q4.

我們可能是——所以我認為，營運支出數字、營業利潤率將反映出這一點，而就毛利率而言，與第四季度相比，我們並沒有真正看到任何重大差異。

Okay fair enough.

好吧，很公平。

And for the sales, if you can give a bit more color, you mentioned 40 tracking similar to average.

對於銷售情況，如果您能提供更多信息，您提到了 40 個與平均值類似的跟踪。

Is there any difference across the end market goals and as a whole if you take the 12 inch versus the 8 inch peaks, if one is picking up more than the other?

如果採用 12 吋和 8 吋峰值，如果其中一個比另一個獲得更多，那麼最終市場目標和整體是否有任何差異？

So, yes, from the -- for the 2Q 2014, our 8 inch wafers' capacity will be kind of full and for 12 inch, what we see from now is -- will be a low-80 percentage utilization rate.

所以，是的，從 2014 年第二季開始，我們的 8 吋晶圓產能將達到滿載，而對於 12 吋晶圓，我們現在看到的利用率將是 80% 左右。

Okay and by application?

好的，透過申請？

By application, communication will be strongest growth in base band and Wi-Fi and driver ICs, and both on the ISP.

按應用程式來看，通訊將在基頻、Wi-Fi 和驅動器 IC 以及 ISP 上成長最為強勁。

And for computers, the NAND and touch and hard disk drive ICs will strengthen.

對於電腦而言，NAND、觸控和硬碟 IC 將增強。

And in consumer, the power management ICs will be from -- increased.

在消費領域，電源管理 IC 將會增加。

Okay.

好的。

And for 8-inch where you're now going to be full by second quarter, how are you looking at your capacity base?

對於 8 吋產品，您現在將在第二季實現滿載，您如何看待您的產能基礎？

Is that an area to -- or do you see a need to expand some of your existing fabs or look for new capacity or how do you see position, if you see demand continue to come in on 8 inch?

這是一個領域嗎？或者您認為需要擴大一些現有的晶圓廠或尋找新的產能，或者如果您看到 8 英寸的需求繼續增加，您如何看待位置？

We are continuously doing debottlenecking across our 8-inch wafer fabs and at the same time, our newly acquired Chinese fab presents some new capacity inflows.

我們正在不斷消除8吋晶圓廠的瓶頸，同時，我們新收購的中國晶圓廠帶來了一些新的產能流入。

So their capacity is shooting from I think previously it was 41k, 42k and now it's 45k, 46k at least.

所以他們的容量是從我認為以前是 41k、42k 到現在至少是 45k、46k。

So, if necessary, there's still space again for 8-inch wafer fab expansion.

因此，如果有必要，8吋晶圓廠仍有擴建空間。

Okay, great.

好的，太好了。

The final question I wanted to ask on the next node.

我想在下一個節點問的最後一個問題。

It's probably a little early to think about it, but for the -- you have the IBM license for 20/14, the next node.

現在考慮這個可能還為時過早，但是對於 - 您擁有 20/14 下一個節點的 IBM 許可證。

How do you see the license now where it looks like Samsung and GlobalFoundries are moving more toward, as Samsung at least licensing GlobalFoundries, so do you have options, is the campaign I guess shifting toward Samsung driving the technology and you have options to license that or is it, it's still your plan for at least second -- I think your IBM deal goes even through 10 nanometer, how do you see that progressing?

您如何看待現在的許可，看起來三星和格羅方德正在朝著更趨向的方向發展，因為三星至少向格羅方德提供許可，所以您有選擇嗎？我猜是轉向三星推動技術，您可以選擇授權該技術或是，這仍然是您至少第二次的計劃——我認為您與 IBM 的交易甚至會涉及 10 奈米，您認為進展如何？

Our 14-nanometer FinFET technology will be -- I think we actually work with our customers, we align with our customers and we'll be available for customer take off.

我們的 14 奈米 FinFET 技術將——我認為我們實際上與我們的客戶合作，我們與客戶保持一致，我們將為客戶的起飛做好準備。

We are targeting by the end of this year and I like to elaborate it a little bit more from three aspects.

我們的目標是今年年底，我想從三個方面詳細闡述。

First is we leverage the module technology from IBM as you just addressed and from 20 nanometer down to the 10 nanometer FinFET JV program.

首先，我們利用您剛才提到的 IBM 模組技術，從 20 奈米一直到 10 奈米 FinFET 合資計畫。

The JV program, we actually sent our R&D engineer to there to join the development.

JV項目，我們實際上派了我們的研發工程師去那裡參與開發。

Second, we also use the third-party secularization vehicle to major position UMC (inaudible) level, and also to identifying UMC's target sweet spot to accelerate UMC's learning curve in the early stage.

其次，我們也利用第三方世俗化工具來主要定位聯電（聽不清楚）層面，並確定聯電的目標最佳點，以加速聯電早期的學習曲線。

And further, we also align with our customers to enhance the test vehicle.

此外，我們還與客戶合作來增強測試車輛。

This is to expedite our 14 nanometer FinFET technology platform and to fill the requirements of 14 FinFET product performance from our customers.

這是為了加快我們的14奈米FinFET技術平台的發展，並滿足客戶對14奈米FinFET產品性能的要求。

So that is -- I will conclude the -- we enhance our 14 nanometer FinFET development methodology.

因此，我將總結一下，我們增強了 14 奈米 FinFET 開發方法。

Okay, great.

好的，太好了。

Thanks for the detail.

謝謝你的詳細資料。

Andrew Lu, Barclays.

安德魯·盧，巴克萊銀行。

Thank you.

謝謝。

(spoken in Chinese).

（用中文說）。

For the second quarter guidance the gross margin is (inaudible) Operating expenses (spoken in Chinese).

對於第二季的指導，毛利率是（聽不清楚）營運費用（用中文說）。

(spoken in Chinese).

（用中文說）。

(spoken in Chinese).

（用中文說）。

We're talking about operating profit margin.

我們談論的是營業利潤率。

We don't really have a number for -- similarly past utilization rate.

我們確實沒有一個類似的過去利用率的數字。

However, this quarter, we -- our guidance is mid-20% for gross margin and operating expenses will be slightly higher than that in first quarter of 2014.

然而，本季度，我們的毛利率指引為 20% 左右，營運費用將略高於 2014 年第一季。

And for the rest of the year, operating expenses probably will stay in 10% range of revenue.

今年剩餘時間裡，營運費用可能會保持在收入的 10% 範圍內。

And we are still in the IBM JV alliance for technology [FinFET] development and at the end of this year, that project will be concluded and we will be able to take some R&D expenses because of that.

我們仍在 IBM 技術 [FinFET] 開發合資企業聯盟中，到今年年底，該專案將結束，我們將能夠因此承擔一些研發費用。

And if everything goes well, we don't see any reason why our operating profit margin will be different compared to a few years back right, when we had similar capacity utilization rates.

如果一切順利，我們看不出有任何理由可以解釋為什麼我們的營業利潤率會與幾年前（當時我們的產能利用率相似）有所不同。

Chi Tung, you just mentioned operating expenses will be higher than the first quarter, would the percentage increase more than the revenue increase or less than the revenue increase?

季東，您剛才提到營業費用會比第一季更高，這個百分比的增幅會高於收入增幅還是低於收入增幅？

Should be less than the revenue increase.

應小於收入增幅。

So the Op margin improvement should be larger than gross margin improvement?

那麼營運利潤率的改善應該大於毛利率的改善嗎？

Correct, yes.

正確，是的。

My second question is 28 nanometer breakdown.

我的第二個問題是28奈米擊穿。

By Q4, earlier CEO mentioned, it will be over 5% contribution by Q4.

到第四季度，先前執行長提到，到第四季貢獻將超過 5%。

Do we have kind of a portion of what percentage will be High-k/metal gate and what percentage will be probably Poly/SiON?

我們是否知道高 k/金屬閘極的比例是多少，多晶矽/SiON 的比例是多少？

For 4Q, I would say we are targeting that all 28 nanometer High-k/metal gate version (inaudible)Poly SiON version from the revenue.

對於第四季度，我想說我們的目標是所有 28 奈米高 k/金屬閘極版本（聽不清楚）聚 SiON 版本的收入。

Largely exceed or slightly over?

大大超過還是稍微超過？

Slightly over.

有點過了。

Thank you.

謝謝。

And last question is for next year what's our plan on 28 expansion?

最後一個問題是，明年我們的 28 擴展計劃是什麼？

Earlier you mentioned it will be (inaudible) by the end of this year, how about next year -- by the end of next year, what kind of capacity we will have for 28 nanometer?

之前您提到今年年底（聽不清楚），明年怎麼樣——到明年年底，我們將擁有什麼樣的 28 奈米產能？

We will take a relative approach on capacity expansion on this 28 nanometer capacity.

在這個28奈米產能上我們會採取相對的方式進行產能擴張。

So we will have economies of scale for 28 nanometer capacity like we built for 65 nanometer in the past years.

因此，我們將擁有 28 奈米產能的規模經濟，就像我們過去幾年為 65 奈米產能打造的那樣。

No numbers?

沒有數字嗎？

No numbers.

沒有數字。

Bill Lu, Morgan Stanley.

比爾‧盧，摩根士丹利。

Hi, good afternoon.

嗨，下午好。

A follow-up on Andrew's question, I don't know if my math is right I did it very quickly, but assuming you to get to say 5% or 6% of revenues for 28 nanometer, your capacity is 12,000 wafers a month.

安德魯的問題的後續，我不知道我的數學是否正確，我做得很快，但假設你說 28 奈米佔收入的 5% 或 6%，你的產能是每月 12,000 片晶圓。

That's basically saying that it's going to be all utilized by the end of the year, is that right?

這基本上是說到年底就會全部用完，對嗎？

Not right.

不對。

We still have some buffer capacity for 28 nanometer.

對於28奈米我們還有一定的緩衝能力。

Besides, we do have some flexibility between 40 nanometer and 28 nanometer.

此外，我們在 40 奈米到 28 奈米之間確實有一定的靈活性。

So it's a little bit fuzzy, if you will, right now in terms of, if you will, 28 nanometer capacities.

所以，如果你願意的話，現在就 28 奈米容量而言，它有點模糊。

Okay, I missed a bit.

好吧，我錯過了一點。

So if you look at the 28 and compare that to the 40 or 65, if you look at 40 as an example, it got to about 20% of revenues.

因此，如果你看一下 28 歲的人，並將其與 40 歲或 65 歲的人進行比較，如果你以 40 歲為例，它約佔收入的 20%。

As you look forward, obviously not now, but a couple of years, do you think 28 could be that big?

當你展望未來時，顯然不是現在，而是幾年後，你認為 28 會那麼大嗎？

I think there are some differences, 28 you'd ramp probably a little bit slower than you did 40 yet it looks like the demand overall for 28 is staying pretty strong in the near-term.

我認為存在一些差異，28 的成長速度可能會比 40 慢一點，但短期內 28 的整體需求似乎仍然相當強勁。

How do you think about that?

您對此有何看法？

I will expect our 28 nanometer revenue share or if we -- because that 28 nanometer is a long life node and it will be also a strong node.

我預計我們的 28 奈米收入份額或如果我們——因為 28 奈米是一個長壽命節點，而且它也將是一個強大的節點。

So, we believe that the 28 nanometer business will be very fruitful for UMC according to our current engagement with our customers.

因此，根據我們目前與客戶的接觸，我們相信28奈米業務對於聯電將是非常有成效的。

Okay, great.

好的，太好了。

It sounds like you're pretty bullish on 28.

看來你對 28 相當看好。

And then just a clarification, it sounds like in the second quarter, 8-inch is going to grow faster than 12-inch and yet you're saying that ASP is flattish.

然後澄清一下，聽起來第二季 8 英寸的增長速度將快於 12 英寸，但你卻說 ASP 持平。

So is that because you got a bit of 28 and 40 is growing, and that's improving the 12-inch ASP or how do I think about that?

那麼，這是因為 28 英寸和 40 英寸的面積正在增長，從而提高了 12 英寸的 ASP，還是我對此有何看法？

That's pretty much right, and also some of the (inaudible) growth at the beginning of the year were not repeated in the second quarter given that (inaudible).

這是非常正確的，而且考慮到這一點（聽不清楚），年初的一些（聽不清楚）成長在第二季也沒有重複。

Got it.

知道了。

Sorry and just circling back to 28, one last question, how many customers do you think you will have at 28 by the end of the year?

抱歉，回到 28 號，最後一個問題，您認為到今年年底您 28 號時會有多少客戶？

We are currently -- we have more than 20 customers engaged and more than 40 products (inaudible) in 28 nanometer.

目前，我們有 20 多家客戶參與，並有 40 多種 28 奈米產品（聽不清楚）。

Okay great, thank you very much.

好的，太好了，非常感謝。

Thank you.

謝謝。

Dan Heyler, Bank of America.

丹·海勒，美國銀行。

Hi, guys.

嗨，大家好。

I just wanted to follow-up a little bit on the -- your early stages of 28, but once by next year if you hit a bigger level of ramp from just a small 10k.

我只是想對你 28 歲的早期階段進行一些跟進，但是明年如果你從 10k 的小成績達到更大的斜坡水平。

How do you -- how can you possibly take meaningful share in terms of number one, the massive scale disadvantage you have relative to TSMC?

相對於台積電，您在規模上存在巨大劣勢，您如何在第一方面獲得有意義的份額？

Number two, there is GlobalFoundries, there is Samsung and there is even SMIC trying to make a run at that business.

第二，格羅方德 (GlobalFoundries)、三星 (Samsung)，甚至中芯國際 (SMIC) 也試圖進軍這項業務。

So I just wonder how confident you are and what your strategy is to really be able to do much in 28 nanometer this late in the game given how small your scale is going to be?

所以我只是想知道，考慮到你們的規模有多小，你們有多大的信心以及你們的策略是什麼，以便在這個遊戲的後期真正能夠在 28 奈米技術上做很多事情？

Our 28 nanometer technology offering, we are especially the High-k/metal gate version, UMC is one of the two.

我們的 28 奈米技術產品，特別是 High-k/金屬閘極版本，UMC 是其中之一。

We can offer that gate loss High-k/metal gate technology.

我們可以提供閘極損耗高 k/金屬閘極技術。

And so we have achieved meaningful progress and in the yield enhancement and we expect we will enter the raised production in the coming several months.

因此，我們在產量提高方面取得了有意義的進展，我們預計我們將在未來幾個月內提高產量。

So we haven't seen overcapacity on 28 nanometer.

所以我們還沒看到28奈米產能過剩。

The major thing is, you think you're probably the -- as far as a second source goes, you think you are in a leading position relative to GlobalFoundries, is that what you're saying?

最重要的是，你認為你可能是 - 就第二個消息來源而言，你認為你相對於 GlobalFoundries 處於領先地位，是你的意思嗎？

Do you think you're ahead of GlobalFoundries as a second source for High-k/metal gate last?

您認為作為 High-k/金屬閘極的第二個供應商，您是否領先格羅方德 (GlobalFoundries)？

Yes.

是的。

Again as I mentioned you have to acknowledge that we are only one -- there are only two companies that can offer High-k/metal gate version.

正如我再次提到的，您必須承認我們只是一家——只有兩家公司可以提供高 k/金屬閘極版本。

And we believe we're in a pretty good position to becoming a more stronger position in -- second source.

我們相信，我們處於非常有利的位置，可以在第二個來源方面變得更強大。

Po, correct me if I'm wrong, Samsung has said they also have now gate last as well, and GlobalFoundries I understand is also offering High-k/metal gate gate last as well, am I mistaken?

Po，如果我錯了，請糾正我，三星表示他們現在也有後柵極，據我了解 GlobalFoundries 也提供高 k/金屬柵極最後柵極，我是否弄錯了？

I don't comment on our competitors' -- their strategy.

我不會評論我們競爭對手的策略。

So you disagree, you think you're the only provider of High-k/metal gate, and that's how you plan to take share.

所以你不同意，你認為你是High-k/金屬閘極的唯一提供者，這就是你打算如何分享份額的方式。

On the second part in terms of scale and efficiency, so to take share I guess maybe explain there will be -- will you need to be pricing-driven or would you pursue more of a specialty area where you would focus your capabilities in certain areas or pricing or a combination of things?

第二部分是規模和效率，所以為了分享，我想也許會解釋一下——你是否需要定價驅動，或者你會追求更多的專業領域，將你的能力集中在某些領域或定價或綜合因素？

Maybe just elaborate for us why someone would use UMC versus their current supplier.

也許只是為我們詳細說明為什麼有人會使用聯華電子而不是他們當前的供應商。

So as I just mentioned, we will also focus on our specialty technology offering.

正如我剛才提到的，我們也將專注於我們的專業技術產品。

So again, we are very -- we have very comprehensive specialty technology platform and a pretty good position in many areas.

再說一遍，我們擁有非常全面的專業技術平台，並且在許多領域都擁有相當好的地位。

For example, high voltage areas and driver areas.

例如，高壓區域和驅動區域。

So we are pretty confident on -- engage more business in that specific technologies.

因此，我們非常有信心——讓更多的業務參與特定技術。

No, is it probably specific to 28 nanometer node though?

不，它可能特定於 28 奈米節點嗎？

So as you have mentioned, we are in a good position in terms of High-k, metal gate and we also have many customers engaged already in the pipeline who are waiting for us to (inaudible) for 28 nanometer business, which including specialty purpose as well.

正如您所提到的，我們在 High-k、金屬閘極方面處於有利位置，我們還有許多已經在籌備中的客戶正在等待我們（聽不清楚）28 奈米業務，其中包括特殊用途以及。

So for the time being, we're fully confident and like, as you mentioned earlier, we're likely to take aggressive efforts on the 28 nanometer, but of course it will depend on the customer adoption rate.

因此，目前我們完全有信心，正如您之前提到的，我們可能會在 28 奈米上採取積極的努力，但這當然取決於客戶的採用率。

Steven Pelayo, HSBC.

史蒂文‧佩拉約，匯豐銀行。

Most of my questions are answered, but I guess a follow-up there.

我的大部分問題都得到了解答，但我想還有後續行動。

If you want to be aggressive at 28 nanometer and you want to have 65 nanometer like economies of scale, it makes me have to ask you about CapEx next year especially if you're only adding roughly 2k more of 28 nanometer this year for the current $1.2 billion in CapEx.

如果你想在 28 奈米上積極進取，並且想要擁有像 65 奈米那樣的規模經濟，那麼我必須向你詢問明年的資本支出，特別是如果你今年只為當前的 28 奈米增加大約 2,000 個的話資本支出12 億美元。

If you want big 65 nanometer like economies of scale, it would suggest a lot higher CapEx next year.

如果您想要像 65 奈米那樣的規模經濟，那麼明年的資本支出就會高得多。

So any thoughts on reconciling your comment about aggressive capacity expansion for 28 nanometer versus CapEx plan?

那麼，對於協調您對 28 奈米積極產能擴張與資本支出計劃的評論有何想法？

A lot of money spent this year is for equipment delivery next year.

今年花的很多錢都是為了明年的設備交付。

So roughly you can use [$120 million to $130 million] as a cost 1k, 28 nanometer capacity.

因此，粗略地說，您可以使用[1.2億至1.3億美元]作為成本1k、28奈米的容量。

So the money we spend this year roughly speaking is equal to about 10k.

所以我們今年花的錢大概是1萬左右。

Now, it won't be all delivery this year.

現在，今年不會全部交貨。

Okay.

好的。

I'm just curious, so last question, what kind of scale do you need in 28 nanometer to have around corporate average that gross margin in that node?

我只是很好奇，所以最後一個問題是，28 奈米需要多大的規模才能在該節點獲得接近公司平均的毛利率？

Do you need to have 20k worth or 30k?

你需要2萬還是3萬？

I have no idea.

我不知道。

Can you help us understand what kind of scale you'd need?

您能幫助我們了解您需要什麼樣的規模嗎？

As I mentioned earlier, the 28 nanometer will be long life and strong node.

正如我之前提到的，28奈米將是長壽命和強節點。

So we'll align with our customers their demand forecast and of course it also depends on UMC's technology and (inaudible) revenues.

因此，我們將與客戶的需求預測保持一致，當然這也取決於聯華電子的技術和（聽不清楚）收入。

So, we're looking for longer range in that.

因此，我們正在尋找更長的射程。

So, all economies of scale we just tell about -- we'll reach the 65 nanometer's range something like that.

因此，我們剛才談到的所有規模經濟——我們將達到類似 65 奈米的範圍。

Okay, let me ask the question another way.

好吧，讓我換個方式問這個問題。

You said in the fourth quarter, you were thinking about something more than 5% of revenues coming from 28 nanometer.

您說在第四季度，您考慮超過 5% 的收入來自 28 奈米。

If you're running that amount of wafers, I don't know if it's probably 5k to 10k per month, somewhere in that range -- 7k to 10k per month depending on whatever ASP you all use.

如果你運行這麼多的晶圓，我不知道它是否可能是每月 5k 到 10k，在這個範圍內的某個地方 - 每月 7k 到 10k，這取決於你使用的 ASP。

Is that a breakeven gross margin level?

這是損益兩平的毛利率水準嗎？

Is that a breakeven operating margin level?

這是損益兩平的營業利潤水準嗎？

Can you help me understand how it scales with the amount of wafers you need to breakeven at 28 nanometer versus then actually getting to kind of corporate average gross margin?

您能否幫助我了解它如何隨著您在 28 奈米技術上實現盈虧平衡所需的晶圓數量與實際達到的企業平均毛利率的關係而變化？

Sure.

當然。

It's largely spent on (inaudible)more than anything else.

它主要花在（聽不清楚）上，而不是其他任何事情。

So if we can fully utilize the capacity ring sales of 28 nanometers and we definitely will be breakeven -- above breakeven for the operating level.

因此，如果我們能夠充分利用28奈米的產能環銷售，我們肯定會實現損益兩平——高於營運水準的損益平衡。

Okay, great.

好的，太好了。

Thank you very much.

非常感謝。

Thank you.

謝謝。

Gokul Hariharan, JPMorgan.

戈庫爾·哈里哈蘭，摩根大通。

Hi, thanks for taking my question.

您好，感謝您提出我的問題。

Another quick question on 8-inch capacity tightness as well as potential conversion to 12 inch basically 90 nanometer or 65 nanometer.

另一個關於 8 英寸產能緊張以及向 12 英寸（基本上是 90 奈米或 65 奈米）的潛在轉換的快速問題。

What is the trend that you guys are seeing in some of your major products, especially like driver IC, in terms of potential conversion to 12-inch wafer size maybe end of this year or early next year?

你們在一些主要產品中看到的趨勢是什麼，特別是驅動IC，在今年年底或明年初可能轉換為12英寸晶圓尺寸方面？

Thanks.

謝謝。

For the driver IC, we do see the growing market transition from 8 inch to 12 inch, but it is -- we think it quite depends on demand situation, and we do see a very pressurized demand situation recently.

對於驅動IC，我們確實看到市場從8英寸向12英寸的轉變不斷增長，但我們認為這很大程度上取決於需求情況，而且我們最近確實看到了非常緊張的需求情況。

I don't have a clear picture now on how much of that transition from 8 inch to 12 inch.

我現在還不清楚從 8 英寸到 12 英寸的轉變有多大。

Maybe I ask it in a different way.

也許我會以不同的方式問它。

Is it something that you're actively encouraging clients to do, one?

這是您積極鼓勵客戶做的事情嗎？

And second, is it something that is only applicable for very high volume kind of products, like high-mix low-volume kind of products, are they like (inaudible) even some of the driver IC stuff, is it still going to be staying at 8-inch for a much longer period of time, even though there is a significant shortage or tightness of 8-inch capacity?

其次，它是否只適用於非常高產量的產品，例如高混合低產量的產品，它們是否像（聽不清）甚至某些驅動器 IC 的東西，它是否仍會保留儘管8英寸產能嚴重短缺或緊張，但仍會在更長的時間內保持8英寸的生產？

We are (inaudible), yes.

我們是（聽不清楚），是的。

And it depends on how our customers' demand and it will be quite based on customers' demand situation.

這取決於我們客戶的需求如何，並且很大程度取決於客戶的需求情況。

Okay, all right.

好吧，好吧。

Lastly, one follow-up on the new -- the solar and other businesses.

最後是新業務的後續行動—太陽能和其他業務。

How should we think about the profitability trend, based on your guidance it looks like the losses are expanding a little bit again in Q2?

我們應該如何看待獲利趨勢，根據您的指導，第二季虧損似乎再次擴大了一點？

Is it something where we will see some kind of limited losses coming through in second half of the year or is it fully dependent on market dynamics in the solar market?

我們是否會在下半年看到某種有限的損失，還是完全取決於太陽能市場的市場動態？

There are several positive one-off events in the first quarter caused the loss to be smaller, but we just assume regular market conditions for second quarter, of course hopefully the end result will be better than our forecast.

第一季有幾個一次性的正面事件導致損失較小，但我們只是假設第二季的市場狀況正常，當然希望最終結果會比我們的預測更好。

So it shouldn't be too much difference compared to Q2 or Q1 in terms of the new business operations.

因此，就新業務營運而言，與第二季或第一季相比，應該不會有太大差異。

Okay.

好的。

So that loss is still going to be at that kind of a pretty steady run rate.

因此，這種損失仍將保持相當穩定的運行速度。

Okay, all right.

好吧，好吧。

Thanks.

謝謝。

Roland Shu, Citigroup.

羅蘭舒，花旗集團。

Hi, Chi Tung and Po Wen.

嗨，志同和博文。

I think the first question of mine is that you talked about the 14 nanometer is going to taping off in end of this year.

我想我的第一個問題是，您談到 14 奈米將在今年年底流片。

So when are you going to mass production for this 14 nanometer?

那麼這個14奈米甚麼時候量產呢？

This is my first question.

這是我的第一個問題。

Thank you.

謝謝。

Yes, let me clarify it a little bit.

是的，讓我稍微澄清一下。

What I just meant is our 14-nanometer FinFET technology will be available for customer tapeout by the end of this year.

我剛才的意思是，我們的 14 奈米 FinFET 技術將於今年底可供客戶流片。

We expect that -- we expect the -- (inaudible) in the next year, 2015.

我們預期──我們預期──（聽不清楚）明年，也就是 2015 年。

So that means that mass production definitely will be much later in -- next year 2015?

那麼這意味著量產肯定會晚得多——明年2015年？

Yes.

是的。

Okay.

好的。

But you have the specific timeline on the mass production for 14 nanometer?

但你有14奈米量產的具體時間表嗎？

So far, we still need to align with our customers.

到目前為止，我們仍然需要與客戶保持一致。

Since again, this is a very dynamic demand situation.

再說一遍，這是一個非常動態的需求狀況。

I cannot comment on that for the moment.

我暫時無法對此發表評論。

Okay, thank you.

好的謝謝。

My second question is about your China business or China investments.

我的第二個問題是關於您的中國業務或中國投資。

I know you are investing in the Hejian and Hejian is expanding their 8-inch capacity.

我知道你們正在投資河間，河間正在擴大他們的8吋產能。

How about your plan to invest 12-inch capacity in China?

您在中國投資12吋產能的計畫如何？

Do you have any kind of business plan in the near-term?

您近期有什麼商業計劃嗎？

We currently do not have any plans to invest 12-inch in China and we will follow the Taiwan regulation.

我們目前沒有計劃在大陸投資12英寸，我們會遵循台灣的規定。

If there is any change in the regulation and also opportunity, of course we will be looking to that.

如果法規和機會有任何變化，我們當然會注意。

Okay, thank you.

好的謝謝。

So how about Hejian.

那麼河間呢？

I think the Hejian -- I think the -- what's their capacity now and what's the ultimate capacity going forward?

我認為河間──我認為──他們現在的能力是什麼？未來的最終能力是什麼？

Right now, as I mentioned, it's ranging from previously 42k per month, now to 46k, 47k per month.

現在，正如我所提到的，它的範圍從以前每月 42k，現在到每月 46k、47k。

Ultimately, they want to expand, they can go up to 60,000 if they want to.

最終，他們想要擴大規模，如果他們願意的話，可以增加到 60,000 人。

Okay.

好的。

So that still depends on demand right?

那麼這仍然取決於需求，對嗎？

Yes.

是的。

Okay, thank you.

好的謝謝。

And last question is about your utility cost.

最後一個問題是關於您的公用事業成本。

So, what's the impact to the gross margin if the power price increased by 30% going forward?

那麼，如果未來電價上漲30%，對毛利率有何影響？

We don't do that kind of hypothetical simulation.

我們不做那種假設模擬。

Basically, from May 1st, we will have some utility price [ticking], and there is also impact for our profit margins, less than 1%.

基本上，從5月1日開始，我們會有一些公用事業價格[滴答]，對我們的利潤率也有影響，不到1%。

Less than 1% right?

不到1%吧？

Yes.

是的。

Michael Chou, Deutsche Bank.

麥可週，德意志銀行。

Hi, I have two questions.

你好，我有兩個問題。

One is the follow-up on 28 nanometer, when would you expect you can have profit and gross margin for 28 nanometer?

一是28奈米的後續，你預計28奈米甚麼時候可以有利潤和毛利率？

So Michael, this is a formula we (inaudible) that's also High-k/metal gate for (inaudible).

所以邁克爾，這是我們（聽不清楚）的公式，也是高 k/金屬閘極（聽不清楚）。

So it's very difficult to comment on that.

所以很難對此發表評論。

We mentioned that by year end this year, if all 28 nanometer is fully loaded, then we will be able to breakeven these for the operating level, but with the corporate average it's also a moving target, it's very difficult to comment on that.

我們提到，到今年年底，如果所有28奈米都滿載，那麼我們將能夠在營運水平上實現收支平衡，但隨著企業平均水平的提高，這也是一個不斷變化的目標，很難對此發表評論。

Okay.

好的。

Is it fair to say to -- is it easy for you to reach over 20% gross margin for your 28 nanometer in maybe four to six quarters, is that fair to say that?

公平地說，你們的 28 奈米技術在四到六個季度內達到超過 20% 的毛利率是否容易？這樣說公平嗎？

There is too many variables.

變數太多了。

I mean, potentially there is no reason why 28 nanometer cannot reach our corporate average if every parameter is not(inaudible).

我的意思是，如果每個參數都達不到（聽不清楚），那麼 28 奈米可能沒有理由無法達到我們公司的平均值。

Okay.

好的。

The second question is for currency, what is your currency assumption for Q2 and what was your currency in Q1?

第二個問題是關於貨幣的，您對第二季的貨幣假設是什麼以及第一季的貨幣是什麼？

Q1 was TWD30.35 and Q2 forecast currently is around TWD30.25.

第一季為 TWD30.35，第二季目前預測約為 TWD30.25。

Thank you so much.

太感謝了。

Thank you.

謝謝。

Donald Lu, Goldman Sachs.

唐納德·盧，高盛。

(spoken in Chinese).

（用中文說）。

(spoken in Chinese).

（用中文說）。

(spoken in Chinese).

（用中文說）。

(spoken in Chinese).

（用中文說）。

28 nanometers, we see good returns and there are opportunities.

28奈米，我們看到了良好的回報，也有機會。

UMC is capable financially.

聯電有財力。

So we'll invest aggressively to capture the opportunity.

因此，我們將積極投資以抓住機會。

We don't really have to be limited by our annual cash flow i.e.

我們實際上不必受到年度現金流的限制，即

the cash inflow versus our dividend and (technical difficulty).

現金流入與我們的股息和（技術難度）。

So we would have to -- we do have the resources to invest over the (inaudible) months.

所以我們必須－我們確實有資源在（聽不清楚）幾個月內進行投資。

(spoken in Chinese).

（用中文說）。

That's a [$1 billion] question, right?

這是一個 [10 億美元] 的問題，對吧？

So no one really can tell how long the upside potential stays.

因此，沒有人能真正判斷上行潛力會持續多久。

All we can do is really to continue to enhance our efficiency, debottleneck (inaudible) facility, at the same time, given the rising opportunity in the market, we're putting more resources on the Hejian facility.

我們能做的就是繼續提高我們的效率，消除瓶頸（聽不清楚）設施，同時，鑑於市場機會不斷增加，我們正在河間設施上投入更多資源。

I think that's how we can improve instead of predicting the up end cycle or range will last for how long.

我認為這就是我們如何改進而不是預測上升週期或範圍將持續多久。

(Operator Instructions).

（操作員說明）。

Szeho Ng, BNP.

吳思豪，BNP。

Hi, good afternoon.

嗨，下午好。

After the conclusion of the IBM JV development, should we assume that R&D back to the level of around something like [$2 billion] a quarter level, R&D expenses I mean?

IBM 合資企業開發結束後，我們是否應該假設研發回到大約每季 [20 億美元] 的水平，我的意思是研發費用？

We'll see some minor drop at the end of this year and the beginning of next year.

今年年底和明年初我們會看到一些小幅下降。

It also depends on how we're going to ramp our 14 nanometer R&D project.

它還取決於我們將如何推進 14 奈米研發項目。

So we're working here, we don't know how much yet.

所以我們在這裡工作，我們還不知道有多少。

I see.

我懂了。

So it shouldn't be a sharp decline right, arbitrarily?

所以它不應該是任意的急劇下降，對嗎？

It won't be a sharp decline.

不會大幅下滑。

Thank you for all your questions.

感謝您提出的所有問題。

That concludes today's Q&A session.

今天的問答環節到此結束。

I'll turn things over to UMC Head of Investor Relations for closing remarks.

我將把事情交給聯華電子投資人關係主管做總結發言。

Thank you everyone for joining us today.

感謝大家今天加入我們。

We appreciate your questions today.

我們感謝您今天提出的問題。

Thank you for your valuable time and we will continue to work and to achieve more success on your behalf.

感謝您抽出寶貴的時間，我們將繼續努力，為您取得更大的成功。

And as always, if you have any additional follow-up questions, please feel free to contact UMC at ir@umc.com.

一如既往，如果您有任何其他後續問題，請隨時透過 ir@umc.com 聯繫 UMC。

Have a good day.

祝你有美好的一天。

Bye, bye.

再見。

Ladies and gentlemen, this concludes our conference for the first quarter 2014.

女士們、先生們，我們 2014 年第一季的會議到此結束。

Thank you for your participation in UMC's conference.

感謝您參加聯華電子的會議。

There will be a webcast replay within an hour.

一小時內將進行網路廣播重播。

Please visit www.umc.com under the Investor Relations, Investor Event section.

請造訪 www.umc.com 的「投資者關係」、「投資者活動」部分。

You may now disconnect.

您現在可以斷開連線。

Goodbye.

再見。