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BILTHOVEN, THE NETHERLANDS, February 18, 2003 - ASM International N.V. (NASDAQ: ASMI and Euronext Amsterdam: ASM) reported today its final 2002 fourth quarter and full year results.
The net loss for the fourth quarter of 2002 amounted to € 6.7 million or € 0.14 diluted net loss per share, compared to a net loss of € 9.0 million or € 0.18 diluted net loss per share for the same period in 2001. Net losses for the year 2002 were € 29.9 million or € 0.61 diluted net loss per share, compared to net earnings of € 6.1 million or € 0.12 diluted net earnings per share for the year 2001.
Net sales
Net sales for the fourth quarter of 2002 amounted to € 137.3 million, an increase of 30.4% compared to net sales for the same period last year of € 105.3 million and 1.9 % below the sales level of the third quarter of 2002.
Net sales for the year 2002, totaled € 518.8 million, 7.5% lower than the net sales of
€ 561.1 million for the year 2001. Net sales of wafer processing equipment (Front-end segment) amounted to € 266.9 million, a decrease of 20.7% compared to 2001 and represented 51.4% of total net sales. Net sales of assembly and packaging equipment and materials (Back-end segment) amounted to € 251.9 million, an increase of 12.2% compared to 2001 ( or 18.3% growth when calculated in HK$, the reporting currency of our Back-end operations ). Back-end represents 48.6% of consolidated ASMI net sales.
€ 561.1 million for the year 2001. Net sales of wafer processing equipment (Front-end segment) amounted to € 266.9 million, a decrease of 20.7% compared to 2001 and represented 51.4% of total net sales. Net sales of assembly and packaging equipment and materials (Back-end segment) amounted to € 251.9 million, an increase of 12.2% compared to 2001 ( or 18.3% growth when calculated in HK$, the reporting currency of our Back-end operations ). Back-end represents 48.6% of consolidated ASMI net sales.
The market for semiconductor equipment is still impacted by the severe downturn in the industry, which started late 2000. This has resulted in low capital spending by semiconductor manufacturers, in particular for capacity-driven purchases. Despite this decline in capacity-driven demand, ASMI has seen a continued interest and orders for new technology and 300mm systems in 2002, in particular for Front-end operations, which benefited from design-in wins at top-tier customers. Sales in Back-end grew primarily due to customer interest in ASMI's new generation wire bonders and other equipment resulting in market share gains. Overall, the increased order activity and customer demand has resulted in a growth of sales levels in the second half of 2002 as compared to the first half of 2002 and the second half of 2001, while sales levels in the first half of 2001 were still benefiting from the relative high backlog at the end of 2000.
Operations
The consolidated gross profit margin for the year 2002 amounted to 36.8% of net sales, 3.0 percentage points below the gross profit margin of 39.8% of net sales for the year 2001. The gross profit margin for the fourth quarter of 2002 was 37.1% of net sales, 1.0 percentage point below the 38.1% gross profit margin realized in the third quarter of 2002. The gross profit margin for Front-end decreased 6.9 percentage points from 39.1% of net sales in 2001 to 32.2% of net sales in 2002, and the Back-end gross profit margin increased 0.8 percentage points from 40.8% of net sales in 2001 to 41.6% of net sales in 2002. The decrease in gross margin for Front-end is the result of lower sales volumes, low margins on new technology shipments for 300mm systems, which were approximately 52% of our 2002 net sales, and the impact of a lower exchange rate of the US dollar in 2002 as compared to 2001. The increase in gross profit margin for Back-end is the result of the higher sales volume in 2002 compared to 2001.
Selling, general and administrative expenses decreased 3.1% from € 111.9 million in 2001 to € 108.4 million in 2002. As a percentage of net sales, selling, general and administrative expenses increased to 20.9% for 2002 from 19.9% for the year 2001. In the fourth quarter of 2002 selling, general and administrative expenses were € 28.8 million, slightly above the € 28.6 million in expenses for the third quarter of 2002. Included in the fourth quarter 2002 were expenses amounting to € 2.5 million related to relocation of Back-end production facilities from Hong Kong to the mainland of China.
Research and development expenses increased from € 79.7 million or 14.2% of net sales in 2001 to € 88.3 million or 17.0% of net sales in 2002. In the fourth quarter of 2002 research and development expenses were € 24.5 million, compared to € 21.0 million in the fourth quarter of 2001, due to expenses related to the development of the Company's Rapid Thermal Processing and 300mm vertical furnace programs in its Front-end operations and bonus programs in its Back-end operations. The Company continued to keep the research and development expenses at a high level despite the market circumstances and concentrated its investments in research and development on equipment and product solutions for the next generations of semiconductor devices.
Amortization of goodwill. As of January 1, 2002 ASMI adopted SFAS 142 "Goodwill and Other Intangible Assets." This new accounting standard requires that goodwill not be amortized, but rather tested at least annually for impairment. Consequently, ASMI stopped amortizing goodwill as of January 1, 2002. No impairment loss was recorded upon adoption of SFAS 142. The Company also tested goodwill for impairment at December 31, 2002, and concluded that goodwill was not impaired. Amortization of goodwill for the full year 2001 amounted to € 7.6 million and for the fourth quarter of 2001 € 1.9 million.
Earnings (loss) from operations amounted to a loss of € 6.0 million in 2002 compared to earnings of € 24.3 million in 2001. In the fourth quarter of 2002, the Company realized a net loss from operations of € 2.4 million compared to a net loss from operations of € 10.0 million in the fourth quarter of 2001.
Net interest and other financial income (expenses) increased to a net expense of
€ 10.4 million in 2002 compared to a net expense of € 1.0 million in 2001. For the fourth quarter of 2002 the net expense was € 3.6 million compared to a net expense of € 0.7 million in the fourth quarter of 2001. The increase in net expense in 2002 was the result of increased borrowings and the full impact of the Company's US$ 115.0 million 5% convertible notes, issued in November 2001, amortization of debt issuance costs related to these convertible notes, and a foreign exchange loss as a result of the changes in foreign exchanges rates between the Euro, the US dollar, the Hong Kong dollar and the Japanese yen in 2002, compared to a small foreign exchange gain in 2001.
€ 10.4 million in 2002 compared to a net expense of € 1.0 million in 2001. For the fourth quarter of 2002 the net expense was € 3.6 million compared to a net expense of € 0.7 million in the fourth quarter of 2001. The increase in net expense in 2002 was the result of increased borrowings and the full impact of the Company's US$ 115.0 million 5% convertible notes, issued in November 2001, amortization of debt issuance costs related to these convertible notes, and a foreign exchange loss as a result of the changes in foreign exchanges rates between the Euro, the US dollar, the Hong Kong dollar and the Japanese yen in 2002, compared to a small foreign exchange gain in 2001.
Bookings and backlog
New orders received in the fourth quarter of 2002 amounted to € 99.6 million, 34.6% lower than the € 152.2 million level of new orders received in the third quarter of 2002. The backlog at the end of December 2002 amounted to € 142.9 million, a decrease of 20.9% compared to backlog of € 180.6 million at the end of September 2002. For the full year of 2002, new orders received were € 529.1 million and the book-to-bill ratio was 1.02. Of the backlog at December 31, 2002, € 109.9 million pertains to Front-end operations and € 33.0 million pertains to Back-end operations.
Banking |facilities
In December 2002, ASMI renewed a multicurrency revolving credit facility with a consortium of banks in the amount of € 70.0 million, consisting of two facilities of
€ 35.0 million with terms of 12 and 18 months, respectively. At December 31, 2002 ASMI had drawn € 10.0 million under this facility, which is available to support the Front End operations of our Group. At year-end ASMI had a total of € 94.5 million in undrawn bank facilities available for use in its Front-end operations and € 48.7 for use in the Back-end operations
€ 35.0 million with terms of 12 and 18 months, respectively. At December 31, 2002 ASMI had drawn € 10.0 million under this facility, which is available to support the Front End operations of our Group. At year-end ASMI had a total of € 94.5 million in undrawn bank facilities available for use in its Front-end operations and € 48.7 for use in the Back-end operations
Outlook
Uncertain market and economic conditions and the lack of visibility in the semiconductor industry make projections for 2003 difficult, if not impossible. In the short term the Company intends to focus on strict cost control and reducing headcount where feasible in its Front-end operations while maintaining a leading position in both its Front-end and Back-end operations.
The Company believes that the increased order activity and design-in wins at top-tier customers for new technology equipment it experienced during 2002 is the result of its strong commitment to research and development in leading edge technology. ASMI believes that it is increasingly well positioned to substantially benefit from the next industry recovery in both the Front-end segment and the Back-end segment of the semiconductor equipment market.
ASM INTERNATIONAL CONFERENCE CALL
ASM International will host an investor conference call and web cast on
WEDNESDAY, FEBRUARY 19, 2002 at
9:00 a.m. US Eastern time
15:00 Continental European time.
The teleconference dial-in numbers are as follows:
United States: 800.450.0788
International: +1 612.332.0820
The teleconference will be available for digitized replay from 2:15 p.m. (U.S. Eastern time) on Wednesday, February 19th until Friday, February 21st at 11:59 p.m. (U.S. Eastern time). The replay numbers are:
United States: 800.475.6701
International +1 320.365.3844.
In both cases, the following access code is required: 670426.
A simultaneous audio web cast will be accessible at www.asm.com and www.companyboardroom.com.
About ASM
ASM International N.V., based in Bilthoven, the Netherlands, is a global company servicing one of the most important and demanding industries in the world. The Company possesses a strong technology base, state-of-the-art manufacturing facilities, a competent and qualified workforce and a highly trained, strategically distributed support network. ASM International and its subsidiaries design and manufacture equipment and materials used to produce semiconductor devices. ASM International and its subsidiaries provide production solutions for wafer processing (Front-end segment) as well as assembly and packaging (Back-end segment) through facilities in the United States, Europe, Japan and Asia. ASM International's common stock trades on NASDAQ (symbol ASMI) and the Euronext Amsterdam Stock Exchange (symbol ASM). For more information, visit ASMI's website at http://www.asm.com.
Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995: All matters discussed in this statement, except for any historical data, are forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. These include, but are not limited to, economic conditions and trends in the semiconductor industry generally and the duration of the current industry downturn specifically, currency fluctuations, the timing of significant orders, market acceptance of new products, competitive factors, litigation involving intellectual property, shareholder and other issues, commercial and economic disruption due to terrorist activity, armed conflict or political instability and other risks indicated in the company's filings from time to time with the U.S. Securities and Exchange Commission, including, but not limited to, the company's report on Form 20-F and Form 6-K as filed.
***Please use the following link to view the press release including financial results:***
