Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, is set to dole out bonuses averaging NT$1.249 million (US$44,767) to its 57,000 employees after posting record net profits in 2021.
Bonus plan approved
A board meeting held on Tuesday approved a plan for TSMC to distribute a total of about NT$71.2 billion in performance and profit-sharing bonuses after its net profit reached a new high of NT$596.54 billion in 2021, up 15.2 percent from a year earlier, with earnings per share at NT$23.01, compared with NT$19.97 a year earlier.
According to TSMC, out of the NT$71.2 billion, NT$35.61 billion in performance bonuses were issued following each quarter of 2021, with the remaining NT$35.61 billion in profit sharing bonuses set to be handed out in July 2022.
To attract and retain talent, TSMC said that the board meeting had also greenlit another plan for the company to issue 1.387 million shares as 2021 employee-restricted stock awards (RSAs), which will link employee compensation with shareholders’ interests and the company’s environmental, social, and governance (ESG) achievements.
Share buyback
In an attempt to offset dilution caused by the issuance of restricted shares to the company’s employees, TSMC said it would launch a share buyback program to repurchase 1.387 million shares from the open market starting from Wednesday and lasting until April 15.
It is TSMC’s first share buyback scheme since 2008, when the chipmaker bought back 283,000 shares between Aug. 13 and Oct. 12.
This time, TSMC said it would buy back shares at a price range between NT$444 and NT$960.
New capital spending plan
In addition, the board meeting approved a capital appropriation plan for TSMC to spend about US$20.94 billion or some NT$555 billion to install and upgrade the firm’s high-end technology capacity, enhance mature and specialty processes, and improve advanced packaging and testing.
TSMC said the newly approved capital appropriation would also be spent on fab construction and the installation of fab facility systems.
In addition, some of the funding will be directed toward research & development capital investments and sustaining capital expenditures from the second quarter to the fourth quarter of this year.
To meet growing global demand, TSMC announced in an investor conference held in mid-January that it plans to spend US$40 billion to US$44 billion in capital expenditure in 2022, a new record high, greatly exceeding 2021’s total of US$30.04 billion.
The massive capital expenditure in 2022 will be used in developing the advanced 2 nanometer, 3nm, 5nm and 7nm processes, as well as specialty processes and photomasking technologies.
The 5nm process is the latest technology that TSMC has put into commercial production, and mass production of the 3nm and 2nm is scheduled for the second half of this year and 2025, respectively.
Cash dividends
TSMC said the board meeting approved a project for the company to issue NT$2.75 in per-share cash dividends for the company’s earnings in the fourth quarter of last year, when its earnings per share stood at NT$6.41, a new quarterly high on the back of strong demand for emerging technologies such as 5G applications, high performance computing devices, the Internet of Things and automotive electronics.
The ex-dividend date is scheduled for June 16 before the cash dividends are issued on July 14, TSMC said.
Meanwhile, the board also agreed a plan for TSMC to sell up to NT$60 billion worth unsecured bonds in Taiwan as well as up to US$1 billion in unsecured bonds on Taiwan’s international bond market.
The proceeds from the bond sales will used to finance the company’s capacity expansion and pollution prevention related expenditures, the chipmaker said.
Source: Focus Taiwan News Channel