SILTERRA ANNOUNCES ROBUST THIRD QUARTER REVENUE
Strong Third Quarter Sets Pace For Annual Revenue Record 

Kulim, Malaysia (October 21, 2004) – Silterra Malaysia Sdn. Bhd., a leading semiconductor wafer foundry, reported fiscal third quarter sales revenue of US$42.4 million. The result was the second highest quarter ever and corresponds to an increase of 146 percent over the year ago quarter. 

Sales for the third quarter, which ended on September 25, 2004, decreased by 11 percent sequentially from the record set in Q2 2004. Silterra’s total sales revenue reached US$127.2 million for the first nine months in 2004. 

“We had a good quarter considering the softening demand in the industry. On a year-over-year basis, we have performed significantly better in all of the key financial and operational metrics,” said Bruce Gray, president, chief operating officer and interim CEO for Silterra. “Our gross margin was better, and we have shipped more wafers at better prices.” 

Wafer shipments were 77 percent higher than Q3 2003 and 16 percent lower than the prior quarter. The blended average selling price (ASP) was 39 percent higher year-over-year and 5 percent better sequentially as the result of a richer product mix. Silterra’s ASP has increased steadily for the last five quarters and is at its highest level since Q4 2002. 

Gray added: “Our execution has been good and our business plan is sound as demonstrated by the fourth consecutive quarter of positive EBITDA. That said, the outlook for the fourth quarter is still unclear as customers have been scaling back their requirement in an effort to reduce channel inventory.” 

Asian customers accounted for 55 percent of total revenue during the quarter, eclipsing those from North America, which had a 45 percent share, for the first time in Silterra’s history. This trend is expected to continue into 2005. 

Silterra’s R&D programs are beginning to contribute to the company’s success. The company’s portfolio of leading edge high voltage process technologies, designed for high growth consumer products such as mobile telephone and digital television, have begun volume production this year. Its advanced 0.13-micron technology, being jointly developed with IMEC of Belgium, is on schedule and initial wafers have already been processed in the Kulim factory. Silterra plans to start running prototypes using the all-copper process on its newly installed equipment in Kulim starting Q1 of 2005 and pilot production is expected to begin in mid-2005. 



About Silterra Malaysia Sdn. Bhd.:

Silterra Malaysia Sdn. Bhd. is a leading semiconductor wafer foundry that provides advanced foundry standard CMOS logic, high-voltage and mixed-signal/RF technologies. The company’s wafer fab has a designed capacity of 40,000 eight-inch wafers per month. Silterra, which is committed to world-class service and environmental friendliness, received Notable Mention in the Malaysian Prime Minister’s Hibiscus Award competition for Environmental Performance in 2003. The company is ISO 9001:2000 and ISO 14001 certified. Silterra’s headquarters and factory are located in Kulim, Malaysia, and has offices in San Jose (California), Scottsdale (Arizona), Hsinchu (Taiwan) and Munich (Germany). For additional information on Silterra or its services, please visit  www.silterra.com.