ASML expects sales growth in 2019
despite challenging environment and proposes to raise dividend by
50%
VELDHOVEN, the Netherlands, January 23, 2019
- ASML Holding N.V. (ASML) today publishes its 2018 fourth-quarter
and full-year results.
-
Q4 net sales of EUR 3.1 billion, net income of
EUR 788 million, gross margin 44.3 percent
-
ASML has signed a Memorandum of Understanding
with Nikon to settle patent dispute
-
2018 net sales of EUR 10.9 billion, net income
EUR 2.6 billion
-
Due to a fire at a supplier, the expected impact
on Q1 2019 sales is around EUR 300 million, which is expected to be
largely recovered in Q2
-
ASML expects Q1 2019 net sales of around EUR 2.1
billion and a gross margin around 40 percent
-
ASML proposes a 50 percent dividend increase to
EUR 2.10 per share
(Figures in millions of euros unless
otherwise indicated) |
Q3 2018 |
Q4 2018 |
FY 2017 3 |
FY 2018 |
Net sales |
2,776 |
3,143 |
8,963 |
10,944 |
...of which Installed Base Management sales 1 |
695 |
719 |
2,538 |
2,685 |
|
|
|
|
|
New lithography systems sold (units) |
51 |
58 |
173 |
207 |
Used lithography systems sold (units) |
2 |
6 |
24 |
17 |
|
|
|
|
|
Net bookings 2
|
2,200 |
1,587 |
9,358 |
8,181 |
|
|
|
|
|
Gross profit |
1,336 |
1,393 |
4,020 |
5,029 |
Gross margin (%) |
48.1 |
|
44.3 |
|
44.9 |
|
46.0 |
|
|
|
|
|
|
Net income |
680 |
788 |
2,067 |
|
2,592 |
EPS (basic; in euros) |
1.60 |
1.87 |
4.81 |
6.10 |
|
|
|
|
|
End-quarter cash and cash equivalents and short-term
investments |
2,948 |
4,034 |
3,288 |
4,034 |
(1) Installed Base Management sales equals our net
service and field option sales.
(2) Net bookings do not include High NA EUV
orders. Q3 bookings include 1 EUV system shipped in Q4 to
collaborative Research Center (imec). This system is not
recognized in revenue.
(3) As of January 1, 2018, ASML has adopted the
new Revenue Recognition Standard (ASC 606) and Lease Standard (ASC
842). The comparative numbers have been adjusted to reflect these
changes in accounting policies.
Numbers have been rounded for readers'
convenience. A complete summary of US GAAP Consolidated Statements
of Operations is published on www.asml.com
CEO Statement
"Our fourth-quarter sales came in above expectations to wrap up a
record 2018 in terms of sales and profitability. The past year was
also crucially successful in terms of technology innovation,
fueling our growth in the coming years. During Q4, we received five
EUV orders. We have customer demand for 30 EUV systems in 2019 and
these shipments will include the first volume production systems to
DRAM memory customers. We expect that chips produced on our EUV
scanners will start to become available to consumers and
enterprises in 2019.
With regards to the markets that we serve, our
customers responded late in Q4 to slowing demand in their
end-markets by delaying deliveries of some of our litho systems
from the first half of 2019 into the second half, in order to
balance supply and demand. For the full year, the Logic segment is
expected to be the growth driver, remaining on track to invest
strongly in technology transitions and production capacity for our
customers' most advanced nodes, which will drive demand for our EUV
and immersion systems. In addition, we continue to see solid demand
for shipments to China. Taken together, we reiterate that we see
market demand that supports yet another sales growth year for ASML
in 2019, with a significantly stronger second half versus the first
half. We see a similar pattern in our gross margins, with lower
margins expected in the first half of 2019, and we expect to
increase to our longer-term trend line by the end of the year.
Despite some uncertainty in the current
environment, we remain confident about our sales and profit targets
for 2020 and beyond, as we communicated at our Investor Day in
November, underlined by a proposal of a 50 percent increase in our
dividend," said ASML President and Chief Executive Officer Peter
Wennink.
Nikon settlement
ASML has signed a Memorandum of Understanding with
Nikon to settle its legal dispute over alleged patent infringements
that were initiated by Nikon. Therefore, ASML has recorded a
provision in its 2018 accounts. This has a negative impact of EUR
131 million on gross margin in 2018.
Q4 2018 Product and Business Highlights
-
In our DUV lithography business, the TWINSCAN
NXT:2000i ramp-up continued. We achieved a record level
time-to-maturity at Memory customers. We reached a high level of
reliability within two months after install, compared with
six months for the previous generation.
-
ASML successfully introduced three new options
for the TWINSCAN XT:860M KrF scanner, aimed to increase the
productivity for both thick and regular resist applications. For
the latter, more than 6,000 wafers per day were successfully
demonstrated at a customer site.
-
For 3D NAND customers utilizing warped wafers,
we delivered the first upgrades with an Advanced Wafer Clamping
System (AWACS) to increase the range of wafer deformation that can
be processed on both the XT and NXT platforms.
-
Our Applications portfolio has continued to see
strong adoption in all segments. Highlights include significant
adoption of our Yieldstar 375 at Memory manufacturing customers and
the introduction of new technologies from our Brion and HMI product
groups that together result in substantial OPC model accuracy
improvements.
-
In our EUV business, we have announced the
NXE:3400C, specified at 170 wafers per hour and with >90 percent
availability. The system will be available to our customers in the
second half of 2019.
Outlook
Due to a fire at one of our suppliers of
electronics components and modules (as announced in a press release
on December 3, 2018), work in progress and part of the inventory
was lost. Due to the integral cycle time of around one quarter for
these modules, we expect ASML's first-quarter sales to be
negatively impacted by approximately EUR 300 million, which we
expect to largely recover in Q2, with the remainder expected to be
recovered in the second half of 2019.
For the first quarter of 2019, ASML expects net
sales of around EUR 2.1 billion, and a gross margin around 40
percent. R&D costs of around EUR 480 million, and SG&A
costs of around EUR 130 million. Our target effective annualized
tax rate is around 14 percent.
Dividend Proposal
ASML will submit a proposal to the 2019 Annual General Meeting of
Shareholders to declare a dividend in respect of 2018 of EUR 2.10
per ordinary share (for a total amount of approximately EUR 0.9
billion), compared with a dividend of EUR 1.40 per ordinary share
paid in respect of 2017.
Update Share Buyback Program
As part of ASML's financial policy to return excess cash to
shareholders through dividends and regularly timed share buybacks,
in January 2018 ASML announced its intention to purchase up to EUR
2.5 billion of shares to be executed within the 2018-2019 time
frame. ASML intends to cancel these shares after repurchase, with
the exception of up to 2.4 million shares, which will be used to
cover employee share plans.
Through December 31, 2018, ASML has acquired
7 million shares under this program for a total consideration of
EUR 1.1 billion.
The current program may be suspended, modified or
discontinued at any time. All transactions under this program are
published on ASML's website (www.asml.com/investors) on a weekly
basis.
Media
Relations Contacts |
Investor
Relations Contacts |
Monique
Mols, phone +31 6 5284 4418 |
Skip
Miller, phone +1 480 235 0934 |
Lucas van
Grinsven, phone +31 6 1019 9532 |
Marcel
Kemp, phone +31 40 268 6494 |
Brittney
Wolff Zatezalo, phone +1 408 483 3207 |
Craig
DeYoung, phone +852 2295 1168 |
Quarterly Video Interview, Press Conference and
Investor and Media Conference Call
With this press release, ASML has published a video interview in
which CEO Peter Wennink discusses the Q4 and Full Year results and
2019 outlook, which can be viewed on www.asml.com.
CEO Peter Wennink and CFO Roger Dassen will host a
press conference in Veldhoven on January 23, 2019 at 11:00 Central
European Time, which will be webcast live on www.asml.com.
A conference call for investors and media will be
hosted by CEO Peter Wennink and CFO Roger Dassen on January 23,
2019 at 15:00 Central European Time / 09:00 U.S. Eastern Time. To
register for the call and receive dial-in information, go to
www.asml.com/qresultscall. Listen-only access is also available via
www.asml.com.
About ASML
ASML is one of the world's leading manufacturers of chip-making
equipment. Our vision is a world in which semiconductor technology
is everywhere and helps to tackle society's toughest challenges. We
contribute to this goal by creating products and services that let
chipmakers define the patterns that integrated circuits are made
of. We continuously raise the capabilities of our products,
enabling our customers to increase the value and reduce the cost of
chips. By helping to make chips cheaper and more powerful, we help
to make semiconductor technology more attractive for a larger range
of products and services, which in turn enables progress in fields
such as healthcare, energy, mobility and entertainment. ASML is a
multinational company with offices in more than 60 cities in 16
countries, headquartered in Veldhoven, the Netherlands. We employ
more than 23,000 people on payroll and flexible contracts
(expressed in full time equivalents). ASML is traded on Euronext
Amsterdam and NASDAQ under the symbol ASML. More information about
ASML, our products and technology, and career opportunities is
available on www.asml.com.
US GAAP and IFRS Financial Reporting
ASML's primary accounting standard for quarterly earnings releases
and annual reports is US GAAP, the accounting principles generally
accepted in the United States of America. Quarterly US GAAP
consolidated statements of operations, consolidated statements of
cash flows and consolidated balance sheets are available on
www.asml.com.
The consolidated balance sheets of ASML Holding
N.V. as of December 31, 2018, the related consolidated
statements of operations and consolidated statements of cash flows
for the quarter and twelve months ended December 31, 2018 as
presented in this press release are unaudited.
In addition to reporting financial figures in
accordance with US GAAP, ASML also reports financial figures in
accordance with International Financial Reporting Standards as
adopted by the European Union ("IFRS") for statutory purposes. The
most significant differences between US GAAP and IFRS that affect
ASML concern the capitalization of certain product development
costs and the accounting of income taxes.
2018 Annual Reports
ASML will publish its 2018 Integrated Report based on US GAAP and
its 2018 Integrated Report based on IFRS on February 6, 2019. The
reports will be published on our website at www.asml.com.
Regulated Information
This press release contains inside information within the meaning
of Article 7(1) of the EU Market Abuse Regulation.
Forward Looking Statements
This document contains statements relating to certain projections,
business trends and other matters that are forward-looking,
including statements with respect to expected trends and outlook,
bookings, expected financial results and trends, including expected
sales, EUV and DUV revenue, gross margin, R&D and SG&A
expenses, and target effective annualized tax rate for the first
quarter of 2019, and expected financial results and trends for the
full year 2019, including the expectation for continued growth in
sales in 2019, with a stronger second half versus the first half,
annual revenue opportunity in 2020 and growth potential through
2025, sales and profit targets for 2020, trends in DUV systems
revenue and Holistic Lithography and installed based management
revenues, expected industry trends and expected trends in the
business environment, including continued solid demand for
shipments to China, expectations with respect to margins in 2019,
including the expected recovery to historic levels by year end
statements with respect to the commitment of customers to insert
EUV into volume manufacturing by ordering systems, statements with
respect to roadmap acceleration, including the introduction of
higher productivity systems in 2019 (including the expected
shipment of NXE:3400C and expected timing thereof) and the expected
benefits, statements with respect to the logic segment expected to
be a growth driver, including its expected investment in technology
transitions and production capacity for advanced nodes, ASML's
commitment to volume manufacturing and secure system performance,
shipments, and support for volume manufacturing, including
availability, progress supporting EUV ramp and improving
consistency, productivity, and production and service capability
enabling required volume as planned, including expected shipments
(including expected EUV shipments in 2019 and expected
availability of chips produced by EUV scanners to customers in
2019), statements with respect to the expected benefits of the
introduction of the new DUV system and expected demand for such
system, the expected benefits of the introduction of technologies
from ASML's Brion and HMI product groups, the expected benefits of
the new options for the TWINSCAN XT:860M KrF scanner and of the
Advanced Wafer Clamping System (AWACS), the expected negative
impact of the fire at one of ASML's suppliers on sales, including
the expected recovery timeline, shrink being a key industry driver
supporting innovation and providing long-term industry growth,
technology innovation driving growth in the next years, Holistic
Lithography enabling affordable shrink and delivering value to
customers, DUV, EUV and Application products providing unique value
drivers for ASML and its customers, the expected continuation of
Moore's law and that EUV will continue to enable Moore's law and
drive long term value for ASML well into the next decade, the
intention to continue to return excess cash to shareholders
through growing dividends and regularly timed share buybacks
in line with ASML's policy, statements with respect to the proposed
dividend for the 2019 Annual General Meeting of Shareholders and
the share repurchase plan for 2018-2019, including the intention to
use certain shares to cover employee share plans and cancel the
rest of the shares upon repurchase, and statements with respect to
the expected impact of accounting standards. You can generally
identify these statements by the use of words like "may", "will",
"could", "should", "project", "believe", "anticipate", "expect",
"plan", "estimate", "forecast", "potential", "intend", "continue",
"targets", "commits to secure" and variations of these words or
comparable words. These statements are not historical facts, but
rather are based on current expectations, estimates, assumptions
and projections about the business and our future financial results
and readers should not place undue reliance on them.
Forward-looking statements do not guarantee future performance and
involve risks and uncertainties. These risks and uncertainties
include, without limitation, economic conditions, product demand
and semiconductor equipment industry capacity, worldwide demand and
manufacturing capacity utilization for semiconductors, including
the impact of general economic conditions on consumer confidence
and demand for our customers' products, competitive products and
pricing, the impact of any manufacturing efficiencies and capacity
constraints, performance of our systems, the continuing success of
technology advances and the related pace of new product development
and customer acceptance of and demand for new products including
EUV and DUV, the number and timing of EUV and DUV systems shipped
and recognized in revenue, timing of EUV orders and the risk of
order cancellation or push out, EUV production capacity, delays in
EUV systems production and development and volume production by
customers, including meeting development requirements for volume
production, demand for EUV systems being sufficient to result in
utilization of EUV facilities in which ASML has made significant
investments, potential inability to recover as planned or at all
from the negative sales impact of the fire at one of our suppliers,
potential inability to successfully integrate acquired businesses
to create value for our customers, our ability to enforce patents
and protect intellectual property rights, the outcome of
intellectual property litigation, availability of raw materials,
critical manufacturing equipment and qualified employees, trade
environment, changes in exchange rates, changes in tax rates,
available cash and liquidity, our ability to refinance our
indebtedness, distributable reserves for dividend payments and
share repurchases, results of the share repurchase plan and other
risks indicated in the risk factors included in ASML's Annual
Report on Form 20-F and other filings with the US Securities and
Exchange Commission. These forward-looking statements are made only
as of the date of this document. We do not undertake to update or
revise the forward-looking statements, whether as a result of new
information, future events or otherwise.
Link to Press Release
Link to Consolidated Financial Statements
This
announcement is distributed by West Corporation on behalf of West
Corporation clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: ASML Holding via Globenewswire
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