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| Photo: Hynix Semiconductor Inc., the world's second-largest manufacturer of memory chips, said Thursday its fourth-quarter net loss more than doubled. | ||
Hynix Semiconductor Inc., the world's second-largest manufacturer of memory chips, said Thursday its fourth-quarter net loss more than doubled amid falling prices and weakness in the South Korean won.
Hynix has racked up five straight quarters of red ink amid a long price slump in the semiconductor industry that has also hit rivals such as Samsung Electronics Co. German memory-chip maker Qimonda AG declared bankruptcy last month.
Creditors for Icheon, South Korea-based Hynix announced a plan in December to provide the company with 800 billion won in new capital to help it overcome a cash squeeze.
Hynix lost 1.33 trillion won ($964.27 million) in the three months ended Dec. 31, the company said in a statement. Hynix posted a net loss of 469 billion won a year earlier.
Sales during the quarter fell 36 percent to 1.21 trillion won from 1.73 trillion won a year earlier.
Hynix announced in December that it would slash the pay of top officials, reduce its executive ranks, encourage workers to quit voluntarily and make all employees take two weeks of unpaid leave between January and April this year to trim costs.
Hynix manufactures both NAND flash and DRAM, or dynamic random access memory, chips. NAND chips are used in digital devices such as music players and cameras, while DRAM chips are used mostly in personal computers.
The company said that DRAM prices fell 43 percent from the third quarter, while NAND prices dropped 18 percent.
Semiconductor manufacturers have been hurt by a prolonged decline in prices for both kinds of chips due to oversupply. The global economic slowdown has also reduced demand for the consumer electronics that the chips help power.
Samsung, the world's largest memory chip manufacturer, last month reported its first ever quarterly net deficit, losing 20 billion won in the fourth quarter as the global economic slump hit prices and demand for mainstay products.
Hynix said a key factor behind the size of its net loss was weakness in the South Korean won combined with the company's "high level of dollar-denominated outstanding debt."
The South Korean won was one of the world's worst-performing currencies last year, falling nearly 26 percent against the dollar. A weak won increases the costs of servicing foreign debt.
For all of 2008, Hynix recorded a net loss of 4.36 trillion won compared with a net profit of 346.3 billion the year before, the company said in a regulatory filing. Sales fell 23 percent to 6.5 trillion won.
So far creditors have provided Hynix with half of a promised 500 billion won in new loans, according to company spokeswoman Park Seong-ae. Hynix raised an additional 324 billion won through a share offering, she said. The share offering was part of the plan worked out by creditors in December.
By Kelly Olsen(AP)
