Net earnings for the fourth quarter of 2000 amounted to € 31.6 million, or € 0.64 diluted net earnings per share, compared to € 9.9 million or € 0.24 per share for the same quarter of 1999. Net earnings for the year 2000, were € 94.3 million, equaling € 1.94 diluted net earnings per share, compared to € 11.1 million or € 0.29 per share for the year 1999.
Pro-forma Net earnings for the fourth quarter of 2000, before taking effect of a change in an accounting principle (which was the basis on which earlier earnings guidance was given in our third quarter report), amounted to € 31.8 million, or € 0.64 diluted net earnings per share. On the same pro-forma basis Net earnings for the year 2000 were € 99.8 million, equaling € 2.06 diluted net earnings per share.
Net sales
Net sales for the fourth quarter of 2000, after adoption of SAB101, amounted to € 266.9 million, which is a sequential increase of 7% over the third quarter of 2000 and 74% higher than the net sales for the fourth quarter of 1999.
Net sales for the year 2000, after adoption of SAB101, totaled € 935.2 million, 126% higher than the net sales for the year 1999. Net sales of wafer processing equipment amounted to € 379.3 million, an increase of 109% and representing 41% of net sales, while net sales of assembly and packaging equipment and materials amounted to
€ 555.9, a growth of 139% and representing 59% of net sales.
Operations
The Gross profit margin reached 44.6% of net sales for the year 2000, an improvement of almost four percentage-points compared to the year 1999. The gross margin for the fourth quarter of 2000 was 45.6%, a further increase over the gross profit margin realized in the third quarter of 2000 of 45.3%. This improvement was achieved by our back-end operations. Selling, general and administrative costs declined from 20.1% of net sales in 1999 to 15.8% of net sales in 2000. Investments in Research and development increased from € 47.1 million in 1999 to € 73.8 million in 2000, but declined as a percentage of net sales from 11.4% in 1999 to 7.9% in 2000.
Earnings from operations, after amortization of intangible fixed assets, amounted to
€ 56.4 million for the fourth quarter of 2000 and € 191.8 million for the year 2000, or 20.5% of net sales, against 9.5% in 1999. Before amortization of intangible fixed assets, earnings from operations amounted to € 58.4 million for the fourth quarter of 2000 and to € 196.1 million for the year 2000, representing an Operations Margin of 21.9% and 21.0% of net sales respectively.
Bookings and backlog
New orders received in the fourth quarter amounted to € 165 million, 52% lower than the record level of new orders received in the third quarter of 2000. The pressure on new orders was most noticeable in the assembly and packaging market, where cutbacks were already visible from August onwards. Our Back-End group saw a sharp drop-off in new orders starting October 2000. The new orders for the Front-End businesses also declined from their record third quarter levels.
The backlog at the end of December 2000 stood at € 346 million, a decrease of € 102 million, or 23%, compared to the backlog at the end of September 2000. Of this backlog, € 212 million pertains to Front-End and € 134 million to Back-End. The December backlog includes € 14.9 million ( September 2000 : € 15.9 million ) of deferred revenue as a result of the adoption of SAB101.
Outlook
The semiconductor industry is coping with inventory adjustments at its customers, following lower than expected growth in demand for pc’s, cars, communications equipment and other electronic products. As a result, they are adjusting their short-term needs for semiconductor manufacturing and assembly capacity, an adjustment that started in the back-end market but is also now noticeable in the front-end markets. While new orders have declined, we have experienced only a limited number of deferrals and cancellations of previously placed orders, resulting in a reduction of our backlog. Our visibility is, therefore, more limited than it was during the last twelve months.
However, capacity adjustments relate to installed 200mm manufacturing capacity and its related assembly and packaging capacity. Technology driven investments in equipment, including the build-up of 300mm wafer processing equipment, are continuing. We believe that we are excellently placed to benefit from these continued investments with our Atomic Layer Deposition tools, our low-k solutions and our 300mm equipment.
Based on our current view of the markets, we expect continued growth of our relative market shares in 2001 with net sales and net earnings levels approximately equal to the full year 2000. Part of this view is, however, an over-proportional contribution from the second half of this year.
Discussion on SAB 101 and the impact of its adoption on ASM International N.V.
ASM International derives its income from the research, development, manufacturing, marketing and servicing of semiconductor equipment and materials. ASM International recognizes revenue from the sale of its products when the risks and rewards of ownership transfer to its customers, which is generally at the time of shipment, as no significant obligations remain after the product has been shipped.
ASM International prepares its financial statements under accounting principles generally accepted in the United States of America and has adopted new guidance on revenue recognition as is described in Staff Accounting Bulletin (“SAB”) No. 101, issued by the Staff of the Securities and Exchange Commission (“SEC”) in December 1999. The adoption takes effect retroactively from January 1, 2000 with a cumulative adjustment in 2000 for the impact on the results reported in preceding years. As a consequence, the results reported for the fourth quarter 2000 are stated inclusive of the guidance received under SAB101 and the results for the nine months ended September 30, 2000 are adjusted to include the effect of SAB101 on revenue, recognized for that period. To show the impact of the adoption, this release also includes pro-forma results.
The new guidance received under SAB101 on revenue recognition has no impact on the Company’s policy with respect to the sale of spare parts, service and materials. With respect to the recognition of revenue derived from the shipment of equipment SAB101 introduces some additional reference points.
Generally, revenue generated with equipment sales to new customers or with equipment sales to existing customers but with new process specifications or with sales of new equipment is recognized upon final acceptance by the customer.
Revenue generated with other equipment sales continues to be recognized upon shipment, but the fair market value of the revenue that is related to installation of that equipment is deferred until the installation work has been completed.
About ASM
ASM International is headquartered in Bilthoven, the Netherlands. ASM International’s subsidiaries design, develop, manufacture and market equipment and materials used to produce semiconductor devices. ASM International and its subsidiaries provide production solutions for the wafer processing, assembly and packaging segments of the semiconductor equipment market through their facilities in the United States, Europe, Japan and Asia. ASM International’s common shares trade on the NASDAQ National Market under the symbol “ASMI” and on the Euronext Stock Exchange in Amsterdam under the symbol “ASM”. More information on ASM can be found on its website at http://www.asm.com
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Safe Harbor Statement under the US 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 in the semiconductor industry, currency fluctuations, the timing of significant orders, market acceptance of new products, competitive factors, risk factors related to litigation and other risks indicated in filings from time to time with the SEC and Stock Exchange Authorities.
ASM INTERNATIONAL CONFERENCE CALL REMINDER
The Company will hold a teleconference on
TUESDAY, FEBRUARY 13, 2001 at
6:00 a.m. US PACIFIC TIME
9:00 a.m. US EASTERN TIME
14:00 GREENWICH MEAN TIME
15:00 EUROPEAN CONTINENTAL TIME
22:00 HONG KONG TIME
To participate in the teleconference call, dial
United States 800.288.8960
International 612.332.0932
(For international calls, please use the appropriate international prefix to access the United States)
Please call the operator approximately 5-10 minutes prior to the scheduled start time.
A digitized replay of the conference call will be available for listening beginning at 12:30 US Eastern Standard Time, Tuesday, February 13th, and ending at 11:59 P.M., Thursday, February 15th.
To access the replay, dial
United States 800.475.6701
International 320.365.3844
Access Code: 566227
Contact: USA: Mary Jo Dieckhaus +1.212.986.2900
International: Lies Rijnveld +31.30.229.8506
To see the full report, click the following link: ASMI 2000 results.pdf
