SMIC Reports 2012 First Quarter Results

All currency figures stated in this report are in US Dollars unless stated otherwise.

The financial statement amounts in this report are determined in accordance with US GAAP.

SHANGHAI, May 10, 2012 /PRNewswire-Asia/ -- Semiconductor Manufacturing International Corporation (NYSE: SMI; SEHK: 981) ("SMIC" or the "Company"), one of the leading semiconductor foundries in the world, today announced its consolidated results of operations for the three months ended March 31, 2012. 

First Quarter 2012 Highlights:

• Revenue up by 14.9% to $332.7 million in 1Q12 from $289.6 million in 4Q11 and down by 10.2% compared to 1Q11.
• Gross margin was 12.0% in 1Q12 compared to -7.4% in 4Q11 primarily due to higher utilization and cost saving actions in 1Q12.
• Net cash flow from operations decreased to $35.8 million in 1Q12 from $84.7 million in 4Q11 mainly due to VAT refund in 2011 Q4.
• Loss attributable to Semiconductor Manufacturing International Corporation was $ 42.8 million in 1Q12, compared to loss of $165.2 million in 4Q11.
• Diluted EPS was $(0.08) per ADS.

Second Quarter 2012 Guidance:

The following statements are forward looking statements which are based on current expectations and which involve risks and uncertainties, some of which are set forth under "Safe Harbor Statements" below.

• Revenue is expected to increase between 19% and 21%.
• Gross margin is expected to range from 19% to 22%.
• Operating expenses excluding foreign exchange differences are expected to range from $101 million to $104 million.

Dr. Tzu-Yin Chiu, Chief Executive Officer, commented, "In the first quarter of 2012, our revenue grew 15% sequentially; in the second quarter of 2012, our revenue is guided to increase between 19 and 21%; and into the second half of this year, we target continued growth. This ongoing momentum is primarily due to various new product ramp-ups for connectivity chips, mobile phones and set-top boxes, and is also attributable to increased demand for some of our existing products. Apart from macro reasons, the increase in demand and utilization is also driven by performance improvements."

"Our China revenue continues to grow along with China's semiconductor market. In the first quarter of 2012, our China revenue grew 9.5% quarter over quarter, equivalent to about 32.5% of our total revenue in the first quarter of 2012."

"We have successfully obtained two major loans in the first quarter of 2012. First, we obtained a $268 million loan facility in February, and second, a $600 million syndicated loan in March. These credit arrangements have helped us achieve a healthier capital structure, and show that both policy and commercial banks recognize our potential."

"We are excited about the growth prospects of the coming quarters and are expecting continued order momentum for both new and existing products, across various applications, from our leading global and Chinese customers."

Conference Call / Webcast Announcement

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The call will be webcast live with audio at http://www.smics.com/eng/investors/ir_presentations.php, or at http://www.media-server.com/m/p/mmjw93d2.

An archived version of the webcast, along with an electronic copy of this news release will be available on the SMIC website for a period of 12 months following the webcast.

For a complete version of "SMIC Reports 2012 First Quarter Results" including financial tables, please go to the following link: http://www.prnasia.com/sa/attachment/2012/05/20120510180725162914.pdf

About SMIC

Semiconductor Manufacturing International Corporation ("SMIC"; NYSE: SMI; SEHK: 981) is one of the leading semiconductor foundries in the world and the largest and most advanced foundry in Mainland China, providing integrated circuit (IC) foundry and technology services at 0.35-micron to 40-nanometer. Headquartered in Shanghai, China, SMIC has a 300mm wafer fabrication facility ("fab") and three 200mm wafer fabs in its Shanghai mega-fab, two 300mm wafer fabs in its Beijing mega-fab, a 200mm wafer fab in Tianjin, and a 200mm fab under construction in Shenzhen. SMIC also has customer service and marketing offices in the U.S., Europe, Japan, and Taiwan, and a representative office in Hong Kong. In addition, SMIC manages and operates a 300mm wafer fab in Wuhan owned by Wuhan Xinxin Semiconductor Manufacturing Corporation.

For more information, please visit www.smics.com.

Safe Harbor Statements

(Under the Private Securities Litigation Reform Act of 1995)

This press release contains, in addition to historical information, "forward-looking statements" within the meaning of the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements, including statements under "Second Quarter 2012 Guidance" are based on SMIC's current assumptions, expectations and projections about future events. SMIC uses words like "believe," "anticipate," "intend," "estimate," "expect," "project" and similar expressions to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements are necessarily estimates reflecting the best judgment of SMIC's senior management and involve significant risks, both known and unknown, uncertainties and other factors that may cause SMIC's actual performance, financial condition or results of operations to be materially different from those suggested by the forward-looking statements including, among others, risks associated with cyclicality and market conditions in the semiconductor industry, the downturn in the global economy and the impact on China's economy, intense competition, timely wafer acceptance by SMIC's customers, timely introduction of new technologies, SMIC's ability to capture growth opportunities in China, supply and demand for semiconductor foundry services, industry overcapacity, shortages in equipment, components and raw materials, orders or judgments from pending litigation, availability of manufacturing capacity and financial stability in end markets.

Investors should consider the information contained in SMIC's filings with the U.S. Securities and Exchange Commission (SEC), including its annual report on 20-F filed with the SEC on April 27, 2012, especially in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections, and such other documents that SMIC may file with the SEC or The Hong Kong Stock Exchange Limited ("SEHK") from time to time, including on Form 6-K. Other unknown or unpredictable factors also could have material adverse effects on SMIC's future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this press release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this press release. Except as required by law, SMIC undertakes no obligation and does not intend to update any forward-looking statement, whether as a result of new information, future events or otherwise.

SMIC has filed with the U.S. Securities and Exchange Commission its annual report on Form 20-F for the year ended December 31, 2011. The annual report is available on our website at www.smics.com. In addition, all SMIC ADR holders have the ability, upon request, to receive a hard copy of our complete audited financials free of charge.

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