Asml Holding Nv · EURONEXT:ASML
Asml Holding Nv — Q3 2006 Earnings Presentation
26 slides from Asml Holding Nv's earnings presentation, Oct 18, 2006
Slide 1: 2006 Third Quarter Results
2006 Third Quarter Results October 18, 2006
Slide 2: Safe Harbor
Safe Harbor “Safe Harbor” Statement under the U.S. Private Securities Litigation Reform Act of 1995: the matters discussed in this document may include forward-looking statements that are subject to risks and uncertainties including, but not limited to: economic conditions, product demand and semico
Slide 3: Agenda
Agenda z Market z Q3 2006: Execution and accomplishments z Q3 2006: Shipment and bookings review z Financial summary z Q4 2006: Outlook z Share buyback z ASML’s drivers for growth / Slide 3
Slide 4: Market
Market GY / Slide 4 ys ASML
Slide 5: Semiconductor Growth Forecast 2006-2007
Semiconductor Growth Forecast 2006-2007 External analysts forecast for 2007 same as 2006 level Semiconductor revenue forecast 2006 & 2007 Consensus: 8.8% 9.0% WSTS (Aug 06) 7.8% 2006 10.2% VLSI Research (Aug 06) 2.2% 8.1% 2007 SIA (Aug 06) 9.8% 11.0% Semico (Sept 06) 11.5% 7.0% ML (June 06) 4.7% 10.
Slide 6: Semiconductor Industry Forecast
Semiconductor Industry Forecast 2005 2006 2007 IC Unit (B) 115 138 150 Growth rate year over year 9% 19% 9% Capex ($B) $51 $59 $57 Growth rate year over year 0% 15% -2% Wafer Fab Equipment Sales ($B) $25 $31 $30 Growth rate year over year -8% 26% -3% Litho Equipment for IC production ($B) $5.0 $6.7
Slide 7: Growth from multiple independent segments
Growth from multiple independent segments Each segment with its own investment cycle Flash shrink - 12 to 15 Shrink for new month investment cycle functionality and cost per function - 12 to 24 month investment cycle R&D Flash DRAM – follows Flash investment cycle by approx 12 months IDM Other Memor
Slide 8: On balance 2007 is going to be a stable year
On balance 2007 is going to be a stable year THE DOWN FORCES THE UP FORCES z Semiconductor unit forecast z 2007 semi unit projection at single coming down digit growth z Growing Inventory of ICs in z Utilization at levels allowing some channels additional Capex z Investments are high as % of z Curre
Slide 9: Q3 2006: Execution and accomplishments
Q3 2006: Execution and accomplishments / Slide 9
Slide 10: Q3 2006: Robust execution
Q3 2006: Robust execution Growth z Revenues of € 958 million up 80% versus a year ago, strongest quarterly sales in history of the company z Increased market share by winning new 300mm fab opportunities Profitability z Operating profit of € 239 million or 25% of net sales, up more than threefold ver
Slide 11: Q3 2006: Technology accomplishments
Q3 2006: Technology accomplishments Solid progress on immersion products z Shipped 7 TWINSCAN XT:1700i in Q3, bringing the total to 15 systems capable of 45nm IC volume production z As of Q3 2006, 4 immersion tools are shipped to Japan z Fast learning about immersion through feedback from 28 immersi
Slide 12: Q3 2006: Shipment and bookings review
Q3 2006: Shipment and bookings review Good shipment quarter with record quarterly revenue z Shipped 71 systems with ASP of € 12.1 million up from € 11.7 million in Q2 2006 due to higher percentage of new ArF systems z Shipped 59 new systems with ASP of € 13.8 million, an increase from € 13.7 million
Slide 13: Financial summary
Financial summary GY / Slide 13 ys ASML
Slide 14: Revenues
Total revenues M€ 3000 2,529 2,465 2500 548 1,959 785 958 2000 Q4 Revenues 1,543 533 820 Q3 1500 611 526 Q2 763 942 1000 351 Q1 370 616 500 609 329 685 629 318 453 179 0 2002 2003 2004 2005 2006 / Slide 14
Slide 15: Revenue breakdown: Q3 2006
Revenue breakdown: Q3 2006 Value per type Value per technology i-line Other systems 8% 7% KrF ArF TWINSCAN 28% 64% 93% TWINSCAN Others units ArF KrF i-line Units 53 18 26 25 20 Value per region Value per end-use Taiwan IDM Europe 15% 19% 10% Korea 38% Memory U.S. 62% Foundry 22% ROW Japan China 19%
Slide 16: Profit & Loss statement M€
Profit & Loss statement M€ Q2 06 Q3 06 YTD Net sales 942 958 2,530 Gross profit 381 391 1,023 Gross margin % 40.4% 40.8% 40.5% R&D costs 92 100 280 SG&A costs 51 51 153 Operating income 238 239 591 Operating income % 25.2% 25.0% 23.4% Net income 167 172 419 Net income % 17.7% 17.9% 16.6% Numbers hav
Slide 17: Key financial trends 2005 - 2006
Key financial trends 2005 - 2006 Profit & Loss Statement M€ Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Units 39 47 51 72 71 Sales 533 548 629 942 958 Gross profit 197 204 252 381 391 Gross margin % 37.0% 37.3% 40.0% 40.4% 40.8% R&D 80 82 87 92 100 SG&A 48 47 50 51 51 Operating income 69 75 114 238 239 Operating
Slide 18: Cash flow M€
Cash flow M€ Q2 06 Q3 06 YTD Net income 167 172 419 Depreciation and amortization 21 30 72 Changes in tax assets and liabilities 65 62 74 Effects of changes in inventories 12 72 (81) Effects of changes in other assets and 65 (334) (371) liabilities Cash flow from operations 330 2 113 Cash flow from
Slide 19: Balance sheet as of Oct 1, 2006 M€
Balance sheet as of Oct 1, 2006 M€ ASSETS June 2006 Oct 2006 Cash and cash equivalents 1,731 44 % 1,581 41 % Accounts receivable, net 540 14 % 675 17 % Inventories, net 916 23 % 837 22 % Other assets 167 4% 194 5% Tax assets 273 7% 267 7% Fixed assets 308 8% 301 8% TOTAL ASSETS 3,935 100% 3,855 100%
Slide 20: Backlog as of Oct 1, 2006
Backlog as of Oct 1, 2006 New Systems Used Systems Total Backlog Backlog Backlog Units 143 8 151 Value M€ 2,099 M€ 27 M€ 2,126 ASP M€ 14.7 M€ 3.4 M€ 14.1 • 74 % of unit backlog carry Q4 ‘06 + Q1 ‘07 shipment dates • Q3 net bookings of 95 systems with a value € 1,193 million including 88 new tools wi
Slide 21: Backlog: litho units and value
Backlog: litho units and value 200 2500 Used systems 180 New systems 160 Backlog value 2000 Backlog value M€ 140 Backlog units 120 1500 100 80 1000 60 40 500 20 0 0 Jun 03 Sep 03 Jun 04 Dec 03 Sep 04 Jun 05 Dec 04 Sep 05 Jun 06 Dec 05 Sep 06 Mar 03 Mar 04 Mar 05 Mar 06 / Slide 21
Slide 22: Backlog lithography per Oct 1, 2006
Backlog lithography per Oct 1, 2006 Total value € 2,126 million Value per type Value per technology TWINSCAN I-line ArF dry 97% 9% 50 % KrF Other systems ArF immersion 22% 3% 19 % Value per region Value per end-use Europe Taiwan 20% Memory 6% 58% IDM U.S. Korea 22% 27% 23% Singapore China 10% Japan
Slide 23: Q4 2006: Outlook
Q4 2006: Outlook z Bookings expected to remain high at 65 units with additional upside potential reflecting two drivers: need for production capacity in segments other than flash and an increase in ASML’s market share z Shipment of 69 systems expected in Q4 z ASP for new system shipments expected to
Slide 24: Share buy back
Share buy back z Repurchased 40.4 million shares through share buyback program and in conjunction with convertible bond redemption z After bond redemption the amount of outstanding shares is reduced by 8.4 million shares z ASML is near its net cash target of € 1 billion z ASML reiterates its commitm
Slide 25: ASML's drivers for growth
ASML’s drivers for growth z Growing needs for Lithography per node: z More tools for more layers z Higher ASP to address complexity z ASML continues to grow its worldwide market share as Technology leadership is fueled by R&D strength and scale z Five industry segments work together resulting in mil
Slide 26: Commitment
L SAA kz A Y t n 5) itm m m O C Yy