Singapore chipmaker looking up


Singapore's exports are up for April, but only slightly to the United States, with shipments to China jumping 69 percent

By Alex Frew McMillan

SINGAPORE (CNN) -- Chartered Semiconductor Manufacturing Ltd. said on Tuesday that it expects sales growth for the quarter now running to be significantly faster.

The world's third-largest contract chip foundry also anticipates less of a loss than before.

Singapore-based Chartered predicts its net loss will be $105 million to $107 million for the second quarter, better than its earlier forecast of $113 million to $116 million.

It now expects sales to rise 40 percent for the second quarter, which runs through June. It had previously forecast sales to grow 25 percent.

March order burst continued

Chartered credited a speed up in orders that started in late March. That has continued, Chia Song Hwee, the company's chief financial officer, explained in a release.

"We are seeing strength this quarter across a wide number of customers, particularly those in our communications and computer segments," he added.

Analysts expect the chip industry to recover from last year, which the industry cites as its worst-ever performance. But the recovery may be slow.

Chartered typically gives a mid-quarter estimate of its performance. But the improved outlook led it to shift the scheduled date up from June 4.

The company had total sales of $84.4 million in the first quarter, implying total sales of around $118 million for the second. Its results are still slated for release on July 19.

City's exports rising fast to China

A better outlook for major tech exporters such as Chartered would suggest that recession-locked Singapore may be on the mend.

Exports from Singapore rose 6.4 percent in April, with shipments to China jumping an impressive 69 percent.

The city state appears to becoming less dependent on its largest market, with shipments to the United States up just 1.2 percent.

Chartered stock is up 2.4 percent at S$4.32 on Tuesday morning, driving Singapore's Straits Times index ahead to the tune of 0.38 percent, to 1,731.07 by mid-morning. That's on a day most Asian markets are posting losses.

Chartered is the third-largest contract chip maker in the world, behind Taiwan Semiconductor Manufacturing Co. (TSMC) and United Microelectronics, both based in Taiwan.