ASM INTERNATIONAL NV ANNOUNCES SECOND QUARTER 2022 RESULTS
July 20, 2022, 6:00 p.m. CET
ASM International NV (Euronext Amsterdam: ASM) today reports its second quarter 2022 operating results (unaudited).
Record orders and revenue in Q2 with continued revenue growth expected for the rest of the year
|millions of euros||Q2 2021||Q1 2022||Q2 2022|
|% change year-on-year as published / at constant exchange rates||73% / 86%||72% / 65%||83% / 73%|
|% change year-on-year as published / at constant exchange rates||20% / 29%||31% / 25%||36% / 30%|
|Gross margin %||48.1%||47.8%||47.5%|
|Operating profit margin %||28.7%||27.7%||26.4%|
|Share in the result of investments in associates (excluding amortization of intangible assets resulting from the sale of the ASMPT investment in 2013)||19.3||23.7||26.9|
|Amortization of intangible assets (resulting from the sale of the ASMPT stake in 2013)||(3.0)||(3.2)||(3.4)|
|Normalized net income (excluding amortization of intangible assets resulting from the sale of the ASMPT stake in 2013 and income from the sale of ASMPT shares)||111.4||145.7||163.8|
- Record new orders of €943 million for the second quarter of 2022 increased by 73% at constant currencies compared to the same period last year (83% on a reported basis).
- Year-over-year revenue growth for the second quarter of 2022 was 30% at constant currencies (36% reported).
- The gross profit margin of 47.5% in the second quarter of 2022 was slightly lower than 48.1% in the same quarter last year, which had a stronger mix.
- Second quarter 2022 operating result improved from €118 million last year to €148 million this year, driven again by strong revenue growth, which was partly offset by an increase in operating expenses.
- Normalized net income for the second quarter of 2022 amounted to 164 million euros and includes a translation gain of 26 million euros compared to a translation loss of 2 million euros in Q2 2021 and a translation gain of 9 million euros in Q1 2022.
“ASM again had a very strong quarter, with record orders, revenue and results,” said Benjamin Loh, President and CEO of ASM International. “In the second quarter, revenue increased by 30% at constant exchange rates to 560 million euros, at the upper end of the guided range of 540 to 570 million euros, because our team, in working closely with suppliers and customers, again demonstrated strong execution in the face of continued challenging supply chain conditions.
While parts of the semiconductor end markets, primarily PCs and smartphones, have recently slowed due to weakening macroeconomic trends, overall demand for wafer fabrication equipment remains strong and diverse. Our order intake jumped 73% at constant exchange rates to reach a new record of 943 million euros in the second quarter. Our orders were boosted by strong spending on new nodes in the logic/foundry segment and our recent gains in memory, particularly for filling ALD gaps in 3D-NAND and the continued adoption of HKMG in DRAM.
R&D and general and administrative expenses increased further in the second quarter as we continue to invest in the growth of our business and prepare for significantly higher expected revenue levels, as evidenced by increases in orders. At the same time, operating profit improved by 25% and free cash flow stood at a good level of 121 million euros in Q2.
Finally, we are very pleased with the recent announcement that we have entered into an agreement to acquire LPE, which will add another high growth business to ASM’s portfolio.
Supply chain conditions improved at a slower pace than expected and as a result are expected to remain challenging in the third quarter. For the third quarter, at constant exchange rates, we expect sales of 570 to 600 million euros. Supported by a record backlog, we continue to expect our sales to improve in the second half compared to the first half. Assuming an improvement in the supply situation towards the end of the year, we expect fourth quarter revenues to be higher than third quarter. As supply constraints will limit the extent to which our shipments increase in the second half of the year, we expect our order backlog to remain at a high level at the end of 2022.
We remain confident of exceeding previously communicated expectations for the increase in the percentage of mid to high teens for wafer fabrication equipment expenditure (WFE) in 2022, although growth in WFE this year is likely will be more towards the lower end of this range due to industry. – supply chain constraints.
LPE ACQUISITION AGREEMENT
On July 18, 2022, ASM announced an agreement to acquire all outstanding shares of LPE SpA (“LPE”), a manufacturer of epitaxial reactors for silicon carbide (SiC) and silicon, based in Italy. The acquisition will complement ASM’s leadership position in silicon epitaxy solutions for the power electronics, analog and wafer markets with LPE’s offering of SiC epitaxy tools advances.
ASM will finance the transaction using a combination of cash and equity, representing an enterprise value of €425 million, on a cash and debt-free basis, as of the closing date. An additional amount of up to €100 million will be paid in the form of an earn-out based on certain performance measures over a period of two years after closing of the transaction. Price supplements must be paid exclusively in cash.
The transaction is subject to FDI and antitrust approvals in a limited number of countries and other customary closing conditions which are expected to be satisfied by the long close date of November 10, 2022. Additional Reference is made to the press release issued on July 18, 2022.
INTERIM FINANCIAL REPORT
ASM International NV (Euronext Amsterdam: ASM) also publishes today its interim financial report for the six-month period ended June 30, 2022.
This report includes an interim report from the Management Board and condensed interim consolidated financial statements prepared in accordance with IAS 34 (Interim Financial Reporting). The interim financial report includes regulated information within the meaning of the Dutch Financial Market Supervision Act (“Wet op het Financieel Toezicht”) and is available in full on our website www.asm.com.
About ASM International
ASM International NV, headquartered in Almere, The Netherlands, and its subsidiaries design and manufacture processing equipment and solutions to produce semiconductor devices for wafer processing, and have facilities in the United States United States, Europe and Asia. The ordinary shares of ASM International are listed on the Euronext Amsterdam Stock Exchange (symbol ASM). For more information, visit the ASM website at www.asm.com
Caution Regarding Forward-Looking Statements: All matters discussed in this press release, except for historical data, are forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. These include, but are not limited to, economic conditions and trends in the semiconductor industry in general and the timing of industry cycles in particular, currency fluctuations, corporate transactions, funding and liquidity issues, success of restructurings, timing of large orders, market acceptance of new products, competitive factors, litigation involving intellectual property, shareholders or other issues, business disruptions and economic risks due to natural disasters, terrorist activities, armed conflicts or political instability, changes in import/export regulations, epidemics and other risks indicated in the Company’s reports and financial statements. The Company undertakes no obligation and does not intend to update or revise any forward-looking statements to reflect future developments or circumstances.
This press release contains inside information within the meaning of Article 7(1) of the European Market Abuse Regulation.
ASM International will host the quarterly results conference call and webcast on Thursday, July 21, 2022 at 3:00 p.m. CET.
Conference call participants must pre-register using this link to receive the dial-in numbers and a personal PIN code needed to access the conference call.
A simultaneous audio webcast and replay will be available on www.asm.com/investors/webcasts-presentations/2022/second-quarter-earnings.