TSMC 2002 Fourth Quarter Report

January 28,2003 - Taiwan Semiconductor Manufacturing Company Ltd. (TAIEX: 2330, NYSE: TSM) (TSMC) today announced its financial results for the fourth quarter of 2002. Net sales for the fourth quarter, ended December 31, 2002, reached NT$41,154 million, while net income totaled NT$2,553 million. Earnings per share for the fourth quarter of 2002 were NT$0.13 based on the current 18,580,700 thousand weighted average outstanding shares.

For fiscal year 2002, ended December 31, the Company's net sales were NT$160,961 million and net income reached NT$21,610 million. Earnings per share for the full year of 2002 were NT$1.14.

TSMC Spokesperson Mr. Harvey Chang said fourth quarter 2002 net sales grew 3.3% over the third quarter, with some fourth quarter revenues attributable to third quarter inventory. The Company’s utilization rate for the fourth quarter decreased to 61% from 79 % in the third quarter. Net income declined 19.2% in the same period.

Compared to the fourth quarter of 2001, TSMC’s net sales for the fourth quarter of 2002 grew 24.2%, while net income decreased 43.4%. Earnings per share for the fourth quarter of 2002 were NT$0.13, representing a 44.4 percent decrease from NT$ 0.24 for the fourth quarter of 2001.

Mr. Harvey Chang noted that the Company’s book-to-bill ratio was above 1.0 in both November and December 2002, indicating a steady growth in orders. This is in line with guidance made during the third quarter 2002 investor conference, whereby TSMC anticipates revenue growth will return in the second quarter of 2003.

TSMC’s 2002 audited financial results are subject to approval by the TSMC Board of Directors.

TSMC’s 2002 fourth quarter results: (Unit: NT$million, except for EPS)

TSMC’s 2002 results: (Unit: NT$million, except for EPS)