Hynix predicts big jump in profit.
Hynix Semiconductor Inc., the world's third-largest maker of computer memory chips, forecast that its net profit will rise 30 percent next year on increasing demand for chips after this year earning its first annual profit since 1999, Bloomberg News reported Wednesday.
Net income next year will rise to $1.7 billion, from $1.3 billion this year, according to a regulatory filing by the company, which is based in Icheon, South Korea. Hynix posted a $2 billion loss last year.
It's crucial for Hynix to stay profitable and amass cash. The company, with a computer memory chip plant in west Eugene and memory chip plants in South Korea, needs to spend heavily on technology to keep up with rivals.
Hynix has said it plans next year to build a plant that uses newer technology to make chips out of wafers measuring 12 inches in diameter, and boost production of dynamic random access memory chips - or DRAM - by 40 percent.
The company hasn't said where it would build that plant, but some analysts suspect that it would be in South Korea. However, the company has land next to its 900-employee west Eugene DRAM plant that could accommodate an additional factory.
After piling up losses of $10 billion over four years and averting bankruptcy through a creditor-led bailout, Hynix has sold assets to focus on making computer memory chips, a global market that researcher Gartner Inc. forecasts will surge 49 percent this year and 12 percent in 2005, to $29.4 billion.
``Hynix has been doing very well in the last few quarters,'' said Andrew Norwood, a semiconductor analyst at Gartner in London. ``We are looking for a good 2004'' for computer memory chips, he said.
As consumers and businesses replace the computers they bought in 2000 and 2001, Hynix plans to boost its sales of DRAM chips by 24 percent this year, the company said.
The forecasts were contained in a regulatory filing about the sale of Hynix's nonmemory business to a Citigroup Inc. private equity fund.
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|Title Annotation:||Business; The company was in the black this year for the first time since 1999|
|Publication:||The Register-Guard (Eugene, OR)|
|Date:||Jun 10, 2004|
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