SMIC to upgrade facilities in profit hunt

Semiconductor Manufacturing International Corp (SMIC) said yesterday that it plans to significantly boost its capital spending this year to upgrade its current facilities in an effort to improve competitiveness and return to profit.

David Wang, the newly appointed chief executive of China's largest contract chip maker, said the company plans capital spending of $335 million this year, up 76 percent from $189.9 million last year. He said SMIC aims to maintain its gross margin at double digits throughout 2010 and outpace the chip foundry market's average 20 percent growth this year.

Founded in 2000, SMIC is the largest foundry in the mainland and gets significant support from the Chinese government, which has long been trying to build up its high-value-added technology industries.