ASML Holding N.V. (ASML) (NASDAQ:ASML) (Amsterdam:ASML) today publishes 2012 third-quarter results.
- Q3 2012 sales and profit are within guidance
- ASML reaches merger agreement with Cymer (see separate press release)
| Q3 2012 | Q2 2012 | ||||
| Net sales | 1,229 | 1,228 | |||
| ...of which service and field option sales | 229 | 243 | |||
| New systems sold (units) | 32 | 42 | |||
| Used systems sold (units) | 8 | 2 | |||
| Net bookings, excluding EUV | 831 | 949 | |||
| Net bookings, excluding EUV (units) | 33 | 43 | |||
| ASP of booked systems, excluding EUV | 25.2 | 22.1 | |||
| Systems backlog, excluding EUV | 1,340 | 1,503 | |||
| Systems backlog, excluding EUV (units) | 48 | 55 | |||
| Gross margin | 43.2 | 43.2 | |||
| End-quarter cash and cash equivalents and short-term investments | 6,159 | 2,702 | |||
| Net income | 275 | 292 | |||
| EPS (in euro) | 0.65 | 0.71 | |||
| (Figures in millions of euros unless otherwise indicated) |
For the fourth quarter of 2012, ASML expects net sales of about EUR 1 billion, gross margin of about 41 percent, R&D costs at EUR 155 million and SG&A costs at EUR 64 million.
Third-Quarter 2012 Highlights- To date we have shipped more than 170 TWINSCAN NXT:1950i systems, our most advanced immersion scanner. More than 45 of these are capable of imaging 230 wafers per hour, and more than 90 immersion systems have exposed more than 1 million wafers within the last 12 months, underlining the robustness of ASML immersion systems to support double patterning.
- Our 6 pre-production EUV systems, called NXE:3100, have exposed more than 23,000 wafers at customer sites with good overlay and imaging performance, enabling semiconductor device recipe development and confirmation of infrastructure progress.
- The successor system, the NXE:3300B, has shown overlay and imaging in a full-field single exposure within customer requirements. We continue to make progress on improving the productivity of the systems currently limited by the EUV light source.
- For further details on EUV, see our separate press release today, 17 October 2012, regarding our merger agreement with Cymer.
All transactions under these programs are published on ASML’s website ( www.asml.com/investors) on a weekly basis. The share buyback programs may be suspended, modified or discontinued at any time.
About ASML ASML is one of the world's leading providers of lithography systems for the semiconductor industry, manufacturing complex machines that are critical to the production of integrated circuits or chips. Headquartered in Veldhoven, the Netherlands, ASML is traded on Euronext Amsterdam and NASDAQ under the symbol ASML. ASML has more than 8,200 employees on payroll (expressed in full time equivalents), serving chip manufacturers in more than 55 locations in 16 countries. More information about our company, our products and technology, and career opportunities is available on our website: www.asml.com Investor and Media Conference Call A conference call for investors and media will be hosted by CEO Eric Meurice and CFO Peter Wennink at 15:00 PM Central European Time / 09:00 AM Eastern U.S. time. Dial-in numbers are: in the Netherlands + 31 10 29 44 290 and the US +1 212 444 0481 (US participants will have to quote the following confirmation code when dialing into the conference: 8424295). To listen to the conference call, access is also available via www.asml.com A replay of the Investor and Media Call will be 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 standard generally accepted in the United States. Quarterly US GAAP consolidated statements of operations, consolidated statements of cash flows and consolidated balance sheets, and a reconciliation of net income and equity from US GAAP to IFRS as adopted by the EU are available on www.asml.com In addition to reporting financial figures in accordance with US GAAP, ASML also reports financial figures in accordance with IFRS for statutory purposes. The most significant differences between US GAAP and IFRS that affect ASML concern the capitalization of certain product development costs, the accounting of share-based payment plans, the accounting of income taxes and the accounting of reversal of inventory write-downs. ASML’s quarterly IFRS consolidated income statement, consolidated statement of cash flows, consolidated statement of financial position and a reconciliation of net income and equity from US GAAP to IFRS are available on www.asml.com The consolidated balance sheets of ASML Holding N.V. as of September 30, 2012, the related consolidated statements of operations and consolidated statements of cash flows for the quarter ended September 30, 2012 as presented in this press release are unaudited.Regulated Information
This press release, the US GAAP consolidated financial statements and the IFRS consolidated financial statements published on www.asml.com comprise regulated information within the meaning of the Dutch Financial Markets Supervision Act ( Wet op het financieel toezicht). Forward Looking Statements “Safe Harbor” Statement under the US Private Securities Litigation Reform Act of 1995: the matters discussed in this document may include forward-looking statements, including statements made about our outlook, including expected sales trends, expected shipments of tools, productivity of our tools, purchase commitments, IC unit demand, financial results, expected gross margin and expenses, statements about our co-investment program including potential funding commitments in connection with that program and statements about our buy-back program. These forward looking statements are subject to risks and uncertainties including, but not limited to: economic conditions, product demand and semiconductor equipment industry capacity, worldwide demand and manufacturing capacity utilization for semiconductors (the principal product of our customer base), including the impact of general economic conditions on consumer confidence and demand for our customers’ products, competitive products and pricing, the impact of manufacturing efficiencies and capacity constraints, the continuing success of technology advances and the related pace of new product development and customer acceptance of new products, our ability to enforce patents and protect intellectual property rights, the risk of intellectual property litigation, availability of raw materials and critical manufacturing equipment, trade environment, changes in exchange rates, available cash, distributable reserves for dividend payments and share repurchases, risks associated with our co-investment program, including whether the 450mm and EUV research and development programs will be successful and ASML’s ability to hire additional workers as part of the 450mm and EUV development programs, our ability to successfully complete acquisitions, including the Cymer transaction or the expected benefits of the Cymer transaction 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.The foregoing risk list of factors is not exhaustive. You should consider carefully the foregoing factors and the other risks and uncertainties that affect the business of ASML described in the risk factors included in ASML's Annual Report on Form 20-F and other documents filed by ASML from time to time with the SEC. ASML disclaims any obligation to update the forward-looking statements contained herein.
Important information for Investors and Stockholders This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. The proposed Cymer transaction will be submitted to the stockholders of Cymer for their consideration. In connection with the proposed Cymer transaction, Cymer will file a proxy statement with the SEC and ASML will file a registration statement on Form F-4 with additional information concerning the transaction, including a proxy statement/prospectus. CYMER STOCKHOLDERS ARE ADVISED TO READ THESE DOCUMENTS CAREFULLY (WHEN THEY BECOME AVAILABLE) AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. The proxy statement, the registration statement, ASML’s Annual Report on Form 20-F and ASML’s subsequent reports filed or furnished to the SEC and other documents containing other important information about Cymer and ASML filed or furnished to the SEC (when they become available) may be read and copied at the SEC’s public reference room located at 100 F Street, N.E., Washington, D.C. 20549. Information on the operation of the Public Reference Rooms may be obtained by calling the SEC at 1-800-SEC-0330. The SEC also maintains a website, www.sec.gov, from which any electronic filings made by ASML may be obtained without charge. In addition, investors and shareholders may obtain copies of the documents filed with or furnished to the SEC upon oral or written request without charge. Requests may be made in writing by regular mail at the following address: De Run 6501, 5504 DR, Veldhoven, The Netherlands, Attention: Manager Investor Relations. Cymer and ASML and their respective directors, executive officers and employees and other persons may be deemed to be participants in the solicitation of proxies in respect of the transaction. Information regarding Cymer's directors and executive officers and their ownership of Cymer common stock is available in Cymer’s proxy statement for its 2012 meeting of stockholders, as filed with the SEC of Schedule 14A on April 11, 2012. Information about ASML's directors and executive officers and their ownership of ASML ordinary shares is available in its Annual Report on Form 20-F for the year ended December 31, 2011 and will be available in the joint proxy statement/prospectus (when available). Other information regarding the interests of such individuals as well as information regarding Cymer's and ASML's directors and officers will be available in the proxy statement/prospectus when it becomes available. These documents can be obtained free of charge from the sources indicated above.| ASML - Summary U.S. GAAP Consolidated Statements of Operations 1,2 | ||||||||
| Three months ended, | Nine months ended, | |||||||
| Sep 30, | Sep 25, | Sep 30, | Sep 25, | |||||
| 2012 | 2011 | 2012 | 2011 | |||||
| (in millions EUR, except per share data) | ||||||||
| Net system sales | 1,000.3 | 1,273.2 | 3,035.1 | 3,891.2 | ||||
| Net service and field option sales | 228.5 | 185.3 | 673.3 | 548.9 | ||||
| Total net sales | 1,228.8 | 1,458.5 | 3,708.4 | 4,440.1 | ||||
| Total cost of sales | 697.8 | 845.1 | 2,123.4 | 2,487.1 | ||||
| Gross profit | 531.0 | 613.4 | 1,585.0 | 1,953.0 | ||||
| Research and development costs | 143.8 | 149.8 | 433.7 | 439.9 | ||||
| Selling, general and administrative costs | 69.7 | 56.3 | 179.8 | 161.6 | ||||
| Income from operations | 317.5 | 407.3 | 971.5 | 1,351.5 | ||||
| Interest income (expense), net | (2.5) | 2.2 | (2.8) | 5.9 | ||||
| Income before income taxes | 315.0 | 409.5 | 968.7 | 1,357.4 | ||||
| Provision for income taxes | (40.3) | (54.3) | (120.1) | (175.1) | ||||
| Net income | 274.7 | 355.2 | 848.6 | 1,182.3 | ||||
| Basic net income per ordinary share | 0.65 | 0.84 | 2.05 | 2.75 | ||||
| Diluted net income per ordinary share | 3 | 0.65 | 0.84 | 2.03 | 2.73 | |||
| Weighted average number of ordinary shares used in computing per share amounts (in millions): | ||||||||
| Basic | 422.5 | 421.9 | 414.6 | 429.2 | ||||
| Diluted | 3 | 425.7 | 425.3 | 417.6 | 432.8 | |||
| ASML - Ratios and Other Data 1,2 | ||||||||
| Three months ended, | Nine months ended, | |||||||
| Sep 30, | Sep 25, | Sep 30, | Sep 25, | |||||
| 2012 | 2011 | 2012 | 2011 | |||||
| (in millions EUR, except otherwise indicated) | ||||||||
| Gross profit as a percentage of net sales | 43.2 | 42.1 | 42.7 | 44.0 | ||||
| Income from operations as a percentage of net sales | 25.8 | 27.9 | 26.2 | 30.4 | ||||
| Net income as a percentage of net sales | 22.4 | 24.4 | 22.9 | 26.6 | ||||
| Income taxes as a percentage of income before income taxes | 12.8 | 13.2 | 12.4 | 12.9 | ||||
| Shareholders’ equity as a percentage of total assets | 65.2 | 46.2 | 65.2 | 46.2 | ||||
| Sales of systems (in units) | 40 | 55 | 136 | 181 | ||||
| Average selling price of system sales (EUR millions) | 25.0 | 23.2 | 22.3 | 21.5 | ||||
| Value of systems backlog excluding EUV (EUR millions) | 1,340 | 1,994 | 1,340 | 1,994 | ||||
| Systems backlog excluding EUV (in units) | 48 | 74 | 48 | 74 | ||||
| Average selling price of systems backlog excluding EUV (EUR millions) | 27.9 | 26.9 | 27.9 | 26.9 | ||||
| Value of booked systems excluding EUV (EUR millions) | 831 | 514 | 2,645 | 2,199 | ||||
| Net bookings excluding EUV (in units) | 33 | 23 | 112 | 97 | ||||
| Average selling price of booked systems excluding EUV (EUR millions) | 25.2 | 22.4 | 23.6 | 22.7 | ||||
| Number of payroll employees in FTEs | 8,203 | 7,848 | 8,203 | 7,848 | ||||
| Number of temporary employees in FTEs | 2,027 | 2,050 | 2,027 | 2,050 | ||||
| ASML - Summary U.S. GAAP Consolidated Balance Sheets 1,2 | ||||||||
| Sep 30, | Dec 31, | |||||||
| 2012 | 2011 | |||||||
| (in millions EUR) | ||||||||
| ASSETS | ||||||||
| Cash and cash equivalents | 4 | 5,118.8 | 2,731.8 | |||||
| Short-term investments | 1,040.0 | - | ||||||
| Accounts receivable, net | 326.8 | 880.6 | ||||||
| Finance receivables, net | 221.6 | 78.9 | ||||||
| Current tax assets | 36.6 | 32.1 | ||||||
| Inventories, net | 1,920.0 | 1,624.6 | ||||||
| Deferred tax assets | 111.0 | 120.7 | ||||||
| Other assets | 235.0 | 238.1 | ||||||
| Total current assets | 9,009.8 | 5,706.8 | ||||||
| Finance receivables, net | 44.7 | - | ||||||
| Deferred tax assets | 38.3 | 38.7 | ||||||
| Other assets | 304.9 | 307.3 | ||||||
| Goodwill | 145.9 | 146.0 | ||||||
| Other intangible assets, net | 7.2 | 8.4 | ||||||
| Property, plant and equipment, net | 1,036.9 | 1,053.6 | ||||||
| Total non-current assets | 1,577.9 | 1,554.0 | ||||||
| Total assets | 10,587.7 | 7,260.8 | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current liabilities | 2,301.8 | 2,233.0 | ||||||
| Long-term debt | 747.3 | 733.8 | ||||||
| Deferred and other tax liabilities | 215.2 | 176.7 | ||||||
| Provisions | 8.7 | 10.0 | ||||||
| Accrued and other liabilities | 409.0 | 663.1 | ||||||
| Total non-current liabilities | 1,380.2 | 1,583.6 | ||||||
| Total liabilities | 3,682.0 | 3,816.6 | ||||||
| Shareholders’ equity | 4 | 6,905.7 | 3,444.2 | |||||
| Total liabilities and shareholders’ equity | 10,587.7 | 7,260.8 | ||||||
| ASML - Summary U.S. GAAP Consolidated Statements of Cash Flows 1,2 | ||||||||
| Three months ended, | Nine months ended, | |||||||
| Sep 30, | Sep 25, | Sep 30, | Sep 25, | |||||
| 2012 | 2011 | 2012 | 2011 | |||||
| (in millions EUR) | ||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net income | 274.7 | 355.2 | 848.6 | 1,182.3 | ||||
| Adjustments to reconcile net income to net cash flows from operating activities: | ||||||||
| Depreciation and amortization | 36.7 | 43.0 | 143.1 | 125.1 | ||||
| Impairment | 1.7 | 9.2 | 2.8 | 9.8 | ||||
| Loss on disposal of property, plant and equipment | 0.5 | 0.3 | 2.0 | 2.2 | ||||
| Share-based payments | 4.9 | 4.0 | 13.7 | 8.8 | ||||
| Allowance for doubtful receivables | 0.5 | (0.9) | 0.8 | 0.3 | ||||
| Allowance for obsolete inventory | 31.0 | 14.3 | 108.0 | 37.2 | ||||
| Deferred income taxes | 25.6 | (3.9) | 47.9 | 35.6 | ||||
| Changes in assets and liabilities | 113.7 | (83.0) | (207.9) | 536.8 | ||||
| Net cash provided by operating activities | 489.3 | 338.2 | 959.0 | 1,938.1 | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Purchase of property, plant and equipment | (50.2) | (79.8) | (136.2) | (207.2) | ||||
| Purchase of intangible assets | - | - | (3.3) | - | ||||
| Purchase of available for sale securities | (440.0) | - | (1,290.0) | - | ||||
| Maturity of available for sale securities | 250.0 | - | 250.0 | - | ||||
| Net cash used in investing activities | (240.2) | (79.8) | (1,179.5) | (207.2) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Dividend paid | - | - | (188.9) | (172.6) | ||||
| Purchase of shares | (25.2) | (173.7) | (269.7) | (539.4) | ||||
| Net proceeds from issuance of shares | 4 | 3,046.5 | 2.5 | 3,067.0 | 26.1 | |||
| Deposits from customers | - | - | - | (150.0) | ||||
| Repayment of debt | (0.7) | (0.6) | (2.1) | (1.9) | ||||
| Tax benefit from share-based payments | 1.5 | - | 1.6 | - | ||||
| Net cash provided by (used in) financing activities | 3,022.1 | (171.8) | 2,607.9 | (837.8) | ||||
| Net cash flows | 3,271.2 | 86.6 | 2,387.4 | 893.1 | ||||
| Effect of changes in currency rates on cash | (4.2) | 9.4 | (0.4) | (4.8) | ||||
| Net increase in cash and cash equivalents | 3,267.0 | 96.0 | 2,387.0 | 888.3 | ||||
| ASML - Quarterly Summary U.S. GAAP Consolidated Statements of Operations 1,2 | ||||||||||
| Three months ended, | ||||||||||
| Sep 30, | Jul 1, | Apr 1, | Dec 31, | Sep 25, | ||||||
| 2012 | 2012 | 2012 | 2011 | 2011 | ||||||
| (in millions EUR, except per share data) | ||||||||||
| Net system sales | 1,000.3 | 984.8 | 1,050.0 | 992.7 | 1,273.2 | |||||
| Net service and field option sales | 228.5 | 242.9 | 201.9 | 218.2 | 185.3 | |||||
| Total net sales | 1,228.8 | 1,227.7 | 1,251.9 | 1,210.9 | 1,458.5 | |||||
| Total cost of sales | 697.8 | 697.3 | 728.3 | 714.5 | 845.1 | |||||
| Gross profit | 531.0 | 530.4 | 523.6 | 496.4 | 613.4 | |||||
| Research and development costs | 143.8 | 144.6 | 145.3 | 150.4 | 149.8 | |||||
| Selling, general and administrative costs | 69.7 | 54.7 | 55.4 | 56.3 | 56.3 | |||||
| Income from operations | 317.5 | 331.1 | 322.9 | 289.7 | 407.3 | |||||
| Interest income (expense), net | (2.5) | (0.9) | 0.6 | 1.5 | 2.2 | |||||
| Income before income taxes | 315.0 | 330.2 | 323.5 | 291.2 | 409.5 | |||||
| Provision for income taxes | (40.3) | (38.3) | (41.5) | (6.5) | (54.3) | |||||
| Net income | 274.7 | 291.9 | 282.0 | 284.7 | 355.2 | |||||
| Basic net income per ordinary share | 0.65 | 0.71 | 0.68 | 0.69 | 0.84 | |||||
| Diluted net income per ordinary share | 3 | 0.65 | 0.71 | 0.68 | 0.68 | 0.84 | ||||
| Weighted average number of ordinary shares used in computing per share amounts (in millions): | ||||||||||
| Basic | 422.5 | 409.5 | 411.8 | 415.6 | 421.9 | |||||
| Diluted | 3 | 425.7 | 412.7 | 415.0 | 419.0 | 425.3 | ||||
| ASML - Quarterly Summary Ratios and other data 1,2 | ||||||||||
| Three months ended, | ||||||||||
| Sep 30, | Jul 1, | Apr 1, | Dec 31, | Sep 25, | ||||||
| 2012 | 2012 | 2012 | 2011 | 2011 | ||||||
| (in millions EUR, except otherwise indicated) | ||||||||||
| Gross profit as a percentage of net sales | 43.2 | 43.2 | 41.8 | 41.0 | 42.1 | |||||
| Income from operations as a percentage of net sales | 25.8 | 27.0 | 25.8 | 23.9 | 27.9 | |||||
| Net income as a percentage of net sales | 22.4 | 23.8 | 22.5 | 23.5 | 24.4 | |||||
| Income taxes as a percentage of income before income taxes | 12.8 | 11.6 | 12.8 | 2.3 | 13.2 | |||||
| Shareholders’ equity as a percentage of total assets | 65.2 | 49.8 | 48.8 | 47.4 | 46.2 | |||||
| Sales of systems (in units) | 40 | 44 | 52 | 41 | 55 | |||||
| Average selling price of system sales (EUR millions) | 25.0 | 22.4 | 20.2 | 24.2 | 23.2 | |||||
| Value of systems backlog excluding EUV (EUR millions) | 1,340 | 1,503 | 1,598 | 1,733 | 1,994 | |||||
| Systems backlog excluding EUV (in units) | 48 | 55 | 56 | 71 | 74 | |||||
| Average selling price of systems backlog excluding EUV (EUR millions) | 27.9 | 27.3 | 28.5 | 24.4 | 26.9 | |||||
| Value of booked systems excluding EUV (EUR millions) | 831 | 949 | 865 | 710 | 514 | |||||
| Net bookings excluding EUV (in units) | 33 | 43 | 36 | 37 | 23 | |||||
| Average selling price of booked systems excluding EUV (EUR millions) | 25.2 | 22.1 | 24.0 | 19.2 | 22.4 | |||||
| Number of payroll employees in FTEs | 8,203 | 8,010 | 7,986 | 7,955 | 7,848 | |||||
| Number of temporary employees in FTEs | 2,027 | 1,860 | 1,833 | 1,935 | 2,050 | |||||
| ASML - Quarterly Summary U.S. GAAP Consolidated Balance Sheets 1,2 | ||||||||||
| Sep 30, | Jul 1, | Apr 1, | Dec 31, | Sep 25, | ||||||
| 2012 | 2012 | 2012 | 2011 | 2011 | ||||||
| (in millions EUR) | ||||||||||
| ASSETS | ||||||||||
| Cash and cash equivalents | 4 | 5,118.8 | 1,851.8 | 2,953.4 | 2,731.8 | 2,838.1 | ||||
| Short-term investments | 1,040.0 | 850.0 | - | - | - | |||||
| Accounts receivable, net | 326.8 | 631.7 | 761.2 | 880.6 | 811.8 | |||||
| Finance receivables, net | 221.6 | 122.3 | 78.8 | 78.9 | 116.2 | |||||
| Current tax assets | 36.6 | 23.6 | 15.6 | 32.1 | 1.0 | |||||
| Inventories, net | 1,920.0 | 1,721.2 | 1,607.6 | 1,624.6 | 1,455.8 | |||||
| Deferred tax assets | 111.0 | 123.4 | 117.3 | 120.7 | 129.9 | |||||
| Other assets | 235.0 | 235.2 | 233.2 | 238.1 | 248.8 | |||||
| Total current assets | 9,009.8 | 5,559.2 | 5,767.1 | 5,706.8 | 5,601.6 | |||||
| Finance receivables, net | 44.7 | - | - | - | - | |||||
| Deferred tax assets | 38.3 | 40.1 | 38.0 | 38.7 | 48.4 | |||||
| Other assets | 304.9 | 290.5 | 318.0 | 307.3 | 248.4 | |||||
| Goodwill | 145.9 | 150.2 | 141.5 | 146.0 | 139.2 | |||||
| Other intangible assets, net | 7.2 | 8.6 | 10.1 | 8.4 | 9.7 | |||||
| Property, plant and equipment, net | 1,036.9 | 1,169.2 | 1,124.6 | 1,053.6 | 1,060.3 | |||||
| Total non-current assets | 1,577.9 | 1,658.6 | 1,632.2 | 1,554.0 | 1,506.0 | |||||
| Total assets | 10,587.7 | 7,217.8 | 7,399.3 | 7,260.8 | 7,107.6 | |||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
| Current liabilities | 2,301.8 | 2,075.0 | 2,091.6 | 2,233.0 | 2,030.9 | |||||
| Long-term debt | 747.3 | 741.8 | 736.8 | 733.8 | 733.1 | |||||
| Deferred and other tax liabilities | 215.2 | 205.1 | 193.8 | 176.7 | 184.6 | |||||
| Provisions | 8.7 | 9.5 | 9.4 | 10.0 | 10.1 | |||||
| Accrued and other liabilities | 409.0 | 590.9 | 755.7 | 663.1 | 864.7 | |||||
| Total non-current liabilities | 1,380.2 | 1,547.3 | 1,695.7 | 1,583.6 | 1,792.5 | |||||
| Total liabilities | 3,682.0 | 3,622.3 | 3,787.3 | 3,816.6 | 3,823.4 | |||||
| Shareholders’ equity | 4 | 6,905.7 | 3,595.5 | 3,612.0 | 3,444.2 | 3,284.2 | ||||
| Total liabilities and shareholders’ equity | 10,587.7 | 7,217.8 | 7,399.3 | 7,260.8 | 7,107.6 | |||||
| ASML - Quarterly Summary U.S. GAAP Consolidated Statements of Cash Flows 1,2 | ||||||||||
| Three months ended, | ||||||||||
| Sep 30, | Jul 1, | Apr 1, | Dec 31, | Sep 25, | ||||||
| 2012 | 2012 | 2012 | 2011 | 2011 | ||||||
| (in millions EUR) | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||
| Net income | 274.7 | 291.9 | 282.0 | 284.7 | 355.2 | |||||
| Adjustments to reconcile net income to net cash flows from operating activities: | ||||||||||
| Depreciation and amortization | 36.7 | 56.8 | 49.6 | 40.1 | 43.0 | |||||
| Impairment | 1.7 | 1.1 | - | 2.5 | 9.2 | |||||
| Loss on disposal of property, plant and equipment | 0.5 | 1.2 | 0.3 | 1.2 | 0.3 | |||||
| Share-based payments | 4.9 | 4.4 | 4.4 | 3.6 | 4.0 | |||||
| Allowance for doubtful receivables | 0.5 | 0.1 | 0.2 | 0.5 | (0.9) | |||||
| Allowance for obsolete inventory | 31.0 | 53.4 | 23.6 | 23.0 | 14.3 | |||||
| Deferred income taxes | 25.6 | 0.7 | 21.6 | 27.6 | (3.9) | |||||
| Changes in assets and liabilities | 113.7 | (335.5) | 13.9 | (250.8) | (83.0) | |||||
| Net cash provided by operating activities | 489.3 | 74.1 | 395.6 | 132.4 | 338.2 | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||
| Purchase of property, plant and equipment | (50.2) | (38.8) | (47.2) | (93.8) | (79.8) | |||||
| Purchase of intangible assets | - | - | (3.3) | - | - | |||||
| Purchase of available for sale securities | (440.0) | (850.0) | - | - | - | |||||
| Maturity of available for sale securities | 250.0 | - | - | - | - | |||||
| Net cash used in investing activities | (240.2) | (888.8) | (50.5) | (93.8) | (79.8) | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||
| Dividend paid | - | (188.9) | - | - | - | |||||
| Purchase of shares | (25.2) | (108.8) | (135.7) | (161.1) | (173.7) | |||||
| Net proceeds from issuance of shares | 4 | 3,046.5 | 4.2 | 16.3 | 8.0 | 2.5 | ||||
| Repayment of debt | (0.7) | (0.7) | (0.7) | (0.7) | (0.6) | |||||
| Tax benefit from share-based payments | 1.5 | - | 0.1 | - | - | |||||
| Net cash provided by (used in) financing activities | 3,022.1 | (294.2) | (120.0) | (153.8) | (171.8) | |||||
| Net cash flows | 3,271.2 | (1,108.9) | 225.1 | (115.2) | 86.6 | |||||
| Effect of changes in currency rates on cash | (4.2) | 7.3 | (3.5) | 8.9 | 9.4 | |||||
| Net increase (decrease) in cash and cash equivalents | 3,267.0 | (1,101.6) | 221.6 | (106.3) | 96.0 | |||||
Principles of consolidation
The consolidated financial statements include the financial statements of ASML Holding N.V. and all of its subsidiaries and the variable interest entities in which ASML is the primary beneficiary (together referred to as “ASML” or the “Company”). Subsidiaries are all entities over which ASML has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. All intercompany profits, balances and transactions have been eliminated in the consolidation. Use of estimates The preparation of ASML’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities on the balance sheet dates, and the reported amounts of revenue and expenses during the reported periods. Actual results could differ from those estimates. Recognition of revenues In general, ASML recognizes revenue when all four revenue recognition criteria are met: persuasive evidence of an arrangement exists; delivery has occurred or services have been rendered; seller’s price to buyer is fixed or determinable; and collectability is reasonably assured. At ASML, this policy generally results in revenue recognition from the sale of a system upon shipment. The revenue from the installation of a system is generally recognized upon completion of that installation at the customer site. Each system undergoes, prior to shipment, a "Factory Acceptance Test" in ASML’s cleanroom facilities, effectively replicating the operating conditions that will be present on the customer's site, in order to verify whether the system will meet its standard specifications and any additional technical and performance criteria agreed with the customer, if any. A system is shipped, and revenue is recognized, only after all specifications are met and customer sign-off is received or waived. In case not all specifications are met and the remaining performance obligation is not essential to the functionality of the system but is substantive rather than inconsequential or perfunctory, a portion of the sales price is deferred. Although each system's performance is re-tested upon installation at the customer's site, ASML has never failed to successfully complete installation of a system at a customer’s premises.The main portion of ASML’s revenue is derived from contractual arrangements with its customers that have multiple deliverables, which mainly include the sale of our systems, installation and training services and prepaid extended and enhanced (optic) warranty contracts. For each of the specified deliverables ASML determines the selling price by using either vendor specific objective evidence (‘VSOE’), third party evidence (‘TPE’) or by best estimate of the selling price (‘BESP’). When the Company is unable to establish relative selling price using VSOE or TPE, the Company uses BESP in its allocation of arrangement consideration. The total arrangement consideration is allocated at inception of the arrangement to all deliverables on the basis of their relative selling price. The revenue relating to the undelivered elements of the arrangements is deferred at their relative selling prices until delivery of these elements. Revenue from installation and training services is recognized when the services are completed. Revenue from prepaid extended and enhanced (optic) warranty contracts is recognized over the term of the contract.
Foreign currency risk management The Company uses the euro as its invoicing currency in order to limit the exposure to foreign currency movements. Exceptions may occur on a customer by customer basis. To the extent that invoicing is done in a currency other than the euro, the Company is exposed to foreign currency risk. It is the Company’s policy to hedge material transaction exposures, such as forecasted sales and purchase transactions and accounts receivable and payable. The Company hedges these exposures through the use of foreign exchange contracts. As of September 30, 2012, shareholders’ equity includes EUR 1.7 million loss (net of taxes: EUR 1.5 million loss; December 31, 2011: EUR 4.4 million loss) representing the total anticipated loss to be charged to sales, and EUR 5.0 million loss (net of taxes: EUR 4.5 million loss; December 31, 2011: EUR 10.3 million gain) to be charged to cost of sales, which will offset the EUR equivalent of foreign currency denominated forecasted sales and purchase transactions.ASML – Reconciliation U.S. GAAP – IFRS 1,2
| Net income | Three months ended, | Nine months ended, | |||||||||
| Sep 30, | Sep 25, | Sep 30, | Sep 25, | ||||||||
| 2012 | 2011 | 2012 | 2011 | ||||||||
| (in millions EUR) | |||||||||||
| Net income based on U.S. GAAP | 274.7 | 355.2 | 848.6 | 1,182.3 | |||||||
| Development expenditures (see Note 1) | 49.0 | (8.6) | 123.7 | (28.0) | |||||||
| Share-based payments (see Note 2) | 0.2 | (0.4) | 0.4 | (0.6) | |||||||
| Reversal of write-downs (see Note 3) | (0.4) | (1.8) | 6.8 | 1.2 | |||||||
| Income taxes (see Note 4) | (0.9) | 5.7 | 2.0 | 22.1 | |||||||
| Net income based on IFRS | 322.6 | 350.1 | 981.5 | 1,177.0 | |||||||
| Shareholders’ equity | Sep 30, | Jul 1, | Apr 1, | Dec 31, | Sep 25, | ||||||
| 2012 | 2012 | 2012 | 2011 | 2011 | |||||||
| (in millions EUR) | |||||||||||
| Shareholders’ equity based on U.S. GAAP | 6,905.7 | 3,595.5 | 3,612.0 | 3,444.2 | 3,284.2 | ||||||
| Development expenditures (see Note 1) | 356.6 | 308.7 | 267.3 | 233.0 | 205.8 | ||||||
| Share-based payments (see Note 2) | 4.1 | 4.0 | 3.7 | 2.7 | 1.1 | ||||||
| Reversal of write-downs (see Note 3) | 14.0 | 14.4 | 6.5 | 7.2 | 3.8 | ||||||
| Income taxes (see Note 4) | 35.0 | 36.4 | 31.4 | 32.7 | 28.5 | ||||||
| Equity based on IFRS | 7,315.4 | 3,959.0 | 3,920.9 | 3,719.8 | 3,523.4 | ||||||
Under U.S. GAAP, ASML applies ASC 730, “Research and Development”. In accordance with ASC 730, ASML charges costs relating to research and development to operating expense as incurred.
Note 2 Share-based Payments Under IFRS, ASML applies IFRS 2, “Share-based Payments” beginning from January 1, 2004. In accordance with IFRS 2, ASML records as an expense the fair value of its share-based payments with respect to stock options and stock granted to its employees after November 7, 2002. Under IFRS, at period end a deferred tax asset is computed on the basis of the tax deduction for the share-based payments under the applicable tax law and is recognized to the extent it is probable that future taxable profit will be available against which these deductible temporary differences will be utilized. Therefore, changes in the Company’s share price do affect the deferred tax asset at period-end and result in adjustments to the deferred tax asset. As of January 1, 2006, ASML applies ASC 718 “Compensation- Stock Compensation” which requires companies to recognize the cost of employee services received in exchange for awards of equity instruments based upon the grant-date fair value of those instruments. ASC 718’s general principle is that a deferred tax asset is established as the Company recognizes compensation costs for commercial purposes for awards that are expected to result in a tax deduction under existing tax law. Under U.S. GAAP, the deferred tax recorded on share-based compensation is computed on the basis of the expense recognized in the financial statements. Therefore, changes in the Company’s share price do not affect the deferred tax asset recorded in the Company’s financial statements. Note 3 Reversal of write-downs Under IFRS, ASML applies IAS 2 (revised), “Inventories”. In accordance with IAS 2, reversal of a prior period write-down as a result of a subsequent increase in value of inventory should be recognized in the period in which the value increase occurs.Under U.S. GAAP, ASML applies ASC 330 “Inventory”. In accordance with ASC 330 reversal of a write-down is prohibited as a write-down creates a new cost basis.
Note 4 Income taxes Under IFRS, ASML applies IAS 12, “Income Taxes” beginning from January 1, 2005. In accordance with IAS 12 unrealized net income resulting from intercompany transactions that are eliminated from the carrying amount of assets in consolidation give rise to a temporary difference for which deferred taxes must be recognized in consolidation. The deferred taxes are calculated based on the tax rate applicable in the purchaser’s tax jurisdiction. Under U.S. GAAP, the elimination of unrealized net income from intercompany transactions that are eliminated from the carrying amount of assets in consolidation give rise to a temporary difference for which prepaid taxes must be recognized in consolidation. Contrary to IFRS, the prepaid taxes under U.S. GAAP are calculated based on the tax rate applicable in the seller’s rather than the purchaser’s tax jurisdiction. “Safe Harbor” Statement under the US Private Securities Litigation Reform Act of 1995: the matters discussed in this document may include forward-looking statements, including statements made about our outlook, including expected sales trends, expected shipments of tools, productivity of our tools, purchase commitments, IC unit demand, financial results, expected gross margin and expenses, statements about our co-investment program including potential funding commitments in connection with that program and statements about our buy-back program. These forward looking statements are subject to risks and uncertainties including, but not limited to: economic conditions, product demand and semiconductor equipment industry capacity, worldwide demand and manufacturing capacity utilization for semiconductors (the principal product of our customer base), including the impact of general economic conditions on consumer confidence and demand for our customers’ products, competitive products and pricing, the impact of manufacturing efficiencies and capacity constraints, the continuing success of technology advances and the related pace of new product development and customer acceptance of new products, our ability to enforce patents and protect intellectual property rights, the risk of intellectual property litigation, availability of raw materials and critical manufacturing equipment, trade environment, changes in exchange rates, available cash, distributable reserves for dividend payments and share repurchases, risks associated with our co-investment program, including whether the 450mm and EUV research and development programs will be successful and ASML’s ability to hire additional workers as part of the 450mm and EUV development programs, our ability to successfully complete acquisitions 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.1 These financial statements are unaudited.
2 Numbers have been rounded. 3 The calculation of diluted net income per ordinary share assumes the exercise of options issued under ASML stock option plans and the issue of shares under ASML share plans for periods in which exercises or issues would have a dilutive effect. The calculation of diluted net income per ordinary share does not assume exercise of such options or issue of shares when such exercises or issue would be anti-dilutive. 4 The Q3 2012 balance includes an amount of EUR 3,016.1 million related to the customer co-investment program, which will be returned to shareholders (excluding participating customers) via a synthetic buyback in Q4 2012.