The Board of Directors of HOLTEK approved the financial results of Q3 2005

October 19, 2005

The Board of Directors of Holtek today approved the financial results of Q3 2005.

Accumulated sales from January to September 2005 were NT$ 2,700 million, showing an 8% decrease compared with the sales of the same period in 2004. Mainly due to the product mix towards MCU shipment and the enhancement of R&D, the average gross margin of the period from January to September 2005 was 41.8 %, higher than 39.4% of same period in 2004；the pre-tax earnings were amounting to NT$660 million, representing an 9% increase YOY, and the accumulated earning after tax were amounting to NT$634 million, also showing an 8% increase YOY. As a result, the earnings per share for the period from January to September 2005 were NT$ 3.20 for pre-tax and NT$ 3.08 for after-tax based on the current outstanding shares. The accumulated earnings per share of NT$3.08 consists of NT$0.5 in Q1, NT$1.16 in Q2 and NT$1.42 in Q3.

The breakdowns of each product line were 40% of the total sales for standard MCU ICs, 29% of the total sales for consumer ICs, 11% of the total sales for PC peripheral ICs, 7% of the total sales for memory ICs, 6% of the total sales for communication ICs, and 7% of the total sales for other ICs. The standard MCU ICs accounted for 40% of the total sales for the period from January to September 2005 compared to 33% of the total sales in the same period 2004. Additionally, together with the sales of embedded MCU ICs, the total MCU sales had reached to 56% of the total sales for the period from January to September 2005.

Holtek would continuously focus on the research and development of MCU products in order to offer the customers with better quality, lower cost and more competitive products；and in turn, to extend the fields of applications and gain more market shares in the future. Besides the extensive sales efforts made in Taiwan and China, Holtek would further extend the sales network to Europe, America, Japan and Korea,…etc and expand MCU application fields to the variety of high-end products such as home appliance, automobile, health care, meter controls and PC peripherals. Finally, how to create Holek's long-term value and continuously enhance competitiveness would be always the goal of Holek's management team.