Interim / Quarterly Report • Aug 8, 2013
Interim / Quarterly Report
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| in 1 million | Q2 / 2013 | Q2/2012 | Change | 6M/2013 | 6M/2012 | Change |
|---|---|---|---|---|---|---|
| Continuing operations | ||||||
| Order entry | 36.7 | 41.4 | -11.4 % | 71.6 | 80.4 | -10.9 % |
| Order backlog as of 06 / 30 | -- | -- | -- | 102.5 | 107.2 | -4.4 % |
| Total sales | 24.9 | 36.3 | -31.4 % | 55.0 | 67.5 | -18.5 % |
| Sales margin | -36.5% | 1.7 % | -38.2 %-points | -21.1% | 0.6 % | -21.7 %-points |
| Gross profit | -0.5 | 13.6 | -- | 6.8 | 24.9 | -72.7 % |
| Gross margin | -2.0% | 37.5 % | -39.5 %-points | 12.4% | 36.9 % | -24.5 %-points |
| Cost of sales | 25.4 | 22.7 | 11.9 % | 48.2 | 42.6 | 13.1 % |
| R&D costs | 3.1 | 2.0 | 55.0 % | 5.3 | 4.4 | 20.5 % |
| Continuing operations | ||||||
| EBITDA | -9.3 | 3.3 | -- | -11.1 | 4.8 | -- |
| EBITDA margin | -37.3% | 9.1 % | -46.4 %-points | -20.2% | 7.1 % | -27.3 %-points |
| EBIT | -11.7 | 1.6 | -- | -15.0 | 1.5 | -- |
| EBIT margin | -47.0% | 4.4 % | -51.4 %-points | -27.3% | 2.2 % | -29.5 %-points |
| Earnings after tax | -9.1 | 0.6 | -- | -11.6 | 0.4 | -- |
| Earnings per share (in 3) basic | -0.48 | 0.03 | -- | -0.61 | 0.02 | -- |
| Continuing and discontinued operations |
||||||
| Earnings after tax | -9.1 | 0.6 | -- | -11.6 | 1.9 | -- |
| Earnings per share (in 3) basic | -0.48 | 0.03 | -- | -0.61 | 0.10 | -- |
| Balance sheet and cash flow | ||||||
| Equity | -- | -- | -- | 114.9 | 122.3 | -6.1 % |
| Equity ratio | -- | -- | -- | 69.3% | 60.4 % | 8.9 %-points |
| Return on equity | -7.9% | 0.5 % | -8.4 %-points | -10.1% | 0.3 % | -10.4 %-points |
| Balance sheet total | -- | -- | -- | 165.9 | 202.5 | -18.1 % |
| Net cash | -- | -- | -- | 19.5 | 30.1 | -35.2 % |
| Free cash flow(1) | -5.2 | -7.4 | -- | -12.4 | -7.1 | -- |
| Further key figures | ||||||
| Investments (2) | 0.8 | 1.9 | -57.9 % | 1.8 | 2.5 | -28.0 % |
| Investment ratio | 3.2% | 5.2 % | -2.0 %-points | 3.3% | 3.7 % | -0.4 %-points |
| Depreciation(3) | 2.3 | 1.8 | 27.8 % | 3.9 | 3.3 | 18.2 % |
| Employees as of 06 / 30 | -- | -- | -- | 680 | 689 | -1.3 % |
After several consecutive quarters of negative economic growth, the eurozone experienced increased economic activity in the second quarter of 2013. Market researchers are looking forward confidently toward the second half of 2013. Rising exports and a modest revival in domestic demand are the first signs of an economic recovery in the eurozone. The prerequisite for a sustainable return to a growth trajectory is the absence of new crises in Europe.
Despite initial signs of an economic recovery, we remain in a challenging economic environment.With respect to order entry, we look back on a positive second quarter of 2013.We were able to record new orders of EUR 36.7 million, thus within our estimated range for the quarter.
On the orders side,there is positive news from the second quarter. In April 2013, we received an order from a leading American integrated device manufacturer (IDM) for a latest-generation laser ablations stepper.The order underscores the increasing significance of this technology for the advanced packaging market. Previously, identically designed tools were delivered to another IDM and a major Asian outsourced assembly and test foundry (OSAT). The ELP300 stepper platform, for wafer sizes between 200 and 300mm, employs an excimer laser and is designed for high-volume manufacturing.Using this laser technology,microstructures can be produced directly on the substrate while avoiding conventional lithographic and etching processes.Aside from the cost advantages of the production process,the system also satisfies the requirements of the latest semiconductor packaging processes. The process is particularly environmentally friendly since etching with toxic chemicals can be avoided through the direct removal of material.
In the second quarter of 2013, order entry rose slightly from the previous quarter. Orders of EUR 36.7 million were recorded, corresponding to an increase of approximately 5 percent from the previous quarter. This represented a decline of approximately 11 percent from the previous year (Q2 2012: EUR 41.4 million). Sales declined from the corresponding quarter of the previous year to EUR 24.9 million (Q2 2012: EUR 36.3 million). The reason for this was the deferment of sales into the second half of the year.Despite the weak second quarter,the sales forecast for the full year remains unchanged.
Considering the entire first half of the year, there was a slight change in order entry. In the first half of 2012, order entry was EUR 80.4 million and, in the first half of 2013, it totaled EUR 71.6 million. Sales of EUR 55.0 million in the first half of the year could not match the level of the previous year and were 18.5 percent below the corresponding figure in the previous year (H1 2012: EUR 67.5 million). The order backlog as of June 30, 2013,thus amounted to EUR 102.5 million (June 30, 2012: EUR 107.2 million).
The gross profit margin for SUSS MicroTec Group declined in the first half of the year to 12.4 percent (H1 2012: 36.9 percent). The reasons for this were the negative gross profit margin in the Substrate Bonder division and a lower gross margin in the Lithography division. The main reasons for this are the shift in product mix from 300mm systems to 200mm tools and the still below average margin of SUSS MicroTec Photonic Systems.
Earnings before interest and taxes (EBIT) of EUR -15.0 million were lower than the EUR 1.5 million of the previous year. EBIT for the first half of 2013 included an extraordinary effect of EUR -6.0 million for refocusing the Permanent Bonding product line.As a result,this extraordinary write-down was EUR 0.8 million lower than originally expected. The extraordinary effect primarily included value adjustments for demonstration equipment and inventories and capitalized development costs from the years prior to 2008. EBIT in the first half of 2012 included one-time currency effects of EUR -0.4 million.This resulted from the settlement of Company-internal foreign currency credits of SUSS MicroTec AG to SUSS MicroTec, Inc. in connection with the acquisition of Tamarack Scientific in March 2012.As a result, adjusted EBIT for the first half of 2013 was EUR -9.0 million (previous year: EUR 1.9 million).
Frank Averdung Chief Executive Officer
Michael Knopp Chief Financial Officer
Earnings after taxes (EAT) for continuing operations amounted to EUR -11.6 million, compared to EUR 0.4 million in the previous year. Earnings after taxes (EAT) amounted to EUR -11.6 million for continuing and discontinued operations, compared to EUR 1.9 million in the previous year. This includes a tax-free amount in 2012 of EUR 1.5 million,which resulted from the sale of the Test Systems division in 2010. Basic earnings per share (EPS) from continuing and discontinued operations amounted to EUR -0.61 (previous year: EUR 0.10).
Cash flow from operating activities was EUR -10.6 million, compared to EUR -4.5 million in the previous year. Free cash flow, excluding the effects of M&A activities and securities purchases and sales, totaled EUR -12.4 million in the first half of the year (previous year: EUR -7.1 million). As of June 30, 2013,the SUSS MicroTec Group therefore had cash and interest-bearing securities of EUR 23.5 million (June 30, 2012: EUR 43.9 million). The net cash position of EUR 19.5 million was lower than the EUR 32,3 million as of December 31, 2012 (June 30, 2012: EUR 30.1 million).
Given the order backlog and the current economic outlook, we continue to project sales of approximately EUR 150 million and a negative EBIT within the range of EUR -10 million to EUR -15 million for the entire 2013 fiscal year.
For the third quarter of 2013, we expect order entry within the range of EUR 30 – 40 million.
Garching,Germany, August 2013
Frank Averdung Michael Knopp Chief Executive Officer Chief Financial Officer
In April 2013, SUSS MicroTec has received a purchase order for its latest generation laser ablation stepper from a leading US-American IDM (Integrated Device Manufacturer). This important sale re-states the increasing importance of this technology in advanced packaging, adding to the recent shipments of the same platform to another IDM and a major Asian OSAT (Outsourced Assembly and Test Foundry). This ELP300 Excimer laser platform is designed for high volume manufacturing and processing of wafer sizes between 200 and 300mm, employing Excimer laser technology to directly create microstructures in lieu of traditional photolithography and wet etch approaches. The advantage of this system is the ability to not only address the challenges in manufacturing next generation semiconductor packages,but also address a means to lower manufacturing costs. This technology is environment friendly as it eliminates the need for wet etching process steps utilizing toxic materials. Shipment of this system is scheduled for Q4 2013.
On April 30 2013, the Company has received a purchase order from an Asian customer for several Mask Aligner systems for production of CMOS image sensors.The customer already owns multiple Mask Aligners, Bond Aligners, Substrate Bonders as well as Coaters and Developers produced by SU-SS MicroTec. The Company is one of the preferred suppliers of this customer. Delivery of the tools started in May 2013 and is expected to be finalized by Q3 this year.
The strategic cooperation with the Cornell NanoScale Science & Technology Facility (CNF), a university nanofab based in North America, has started already in 2011. As part of the cooperation, CNF has developed and tested new processes and technologies on SUSS MicroTec equipment, which included enhanced contact aligner tool sets and a Gamma spray coater. The lithography equipment included two specialized mask aligner toolsets for the SUSS MA/BA6 aligner: Substrate Conformal Imprinting Lithography (SCIL), a technology developed by SUSS MicroTec in conjunction with a customer, and MO Exposure Optics, a patented technique developed by SUSS MicroTec's subsidiary SUSS MicroOptics.This unique illumination technology extends the performance of standard lithography processes. The additionally provided Gamma coater cluster is used to support all resist processing operations at CNF.
According to a study by the ifo Institute,the real gross domestic product of the eurozone decreased by 0.3% in the first quarter of 2013, thus declining for the sixth consecutive quarter. In the second quarter of this year,however, a slight recovery in real economic activity is expected,namely an improvement of approximately 0.1%. In the following two quarters, economic growth should accelerate slightly (+0.2% and +0.3%, respectively). The reasons cited for this are rising exports and a moderate upturn in domestic demand.Nevertheless,the fiscal consolidation measures and debt relief efforts of many companies and financial institutions are expected to slow down the recovery in some EU member countries. Overall, market researchers are viewing the outlook for the near future with cautious optimism.
The announcement by the Federal Reserve Bank that it might end its program of quantitative easing earlier than planned – in particular,this would mean an end to massive bond purchases – stimulated renewed nervousness in the financial markets in May. Since then, bond investors have increasingly withdrawn investments from US bonds. In addition,the international stock markets have responded in the interim with significant price volatility. Overall, the German stock market has cooled down since reaching a high for the DAX at the end of May 2013 and the DAX has once again moved slightly lower.
On January 2, 2013, the SUSS MicroTec share began the current fiscal year at a closing price of 1 8.85. Over the course of January 2013, our share price was able to climb to 1 10.00 once again. By mid-February, the price of the SUSS MicroTec share had moved slightly lower. After publication of preliminary figures for the 2012 fiscal year and the announcement of a restrained outlook for the full year in 2013,the share price responded with a significant drop.This trend was broken briefly with the announcement of an important customer order in the area of 3D integration on March 28, 2013. Following this report,the price rose sharply and the share was able to conclude the first quarter with an overall increase of one percent, corresponding to a closing price of 1 8.91. During the second quarter,the share declined, accompanied by relatively low trading volumes and continuing high volatility, closing the second quarter at a price of 1 7.88.This corresponds to a loss of approximately 11% since the beginning of the year.By contrast,the TecDAX and Semiconductor Index of the Deutsche Börse AG rose in the first half of the year, achieving gains of 12 and 3%,respectively.
The average daily trading volume of SUSS MicroTec shares on all German stock exchanges in the first half of 2013 amounted to approximately 92,800 shares (H1 2012: average daily trading volume of approximately 152,000 shares).
On June 19, 2013,the ordinary Shareholders'Meeting was held at the Haus der BayrischenWirtschaft (House of the Bavarian Economy) in Munich. In total,more than 80 shareholders, shareholder and bank representatives, and guests accepted the Company's invitation to the event in Munich.As a result, 26.9% of the Company's equity capital was present at the Shareholders'Meeting.
In addition to the decision about the appropriation of retained earnings and the discharge from liability for the Management Board and the Supervisory Board, the authorization to repurchase treasury shares and the creation of authorized capital were on the agenda.The shareholders of the Company approved all of the resolution proposals presented by the Management Board and the Supervisory Board at this year's ordinary Shareholders'Meeting.
In his report,Chief Executive Officer Frank P.Averdung discussed the key developments and results of the past fiscal year and the first quarter of 2013 and confirmed the outlook for the entire 2013 fiscal year. His remarks focused on strengthening and expanding the core Lithography division.
SUSS MicroTec Share Performance in 2013 (SUSS MicroTec share price on January 2, 2013: 3 8.85)
of SUSS MicroTec AG
Order entry for the first half of 2013 totaled 1 71.6 million after 1 80.4 million in 2012. Sales of 155.0 million in the first half of the year could not match the level of the previous year and were 18.5% below the corresponding figure in the previous year (H1 2012: 167.5 million). The order backlog as of June 30, 2013, thus amounted to 1102.5 million (June 30, 2012:1 107.2 million).
Earnings before interest and taxes (EBIT) of 1-15.0 million were much lower than the 11.5 million of the previous year. EBIT for the first half of 2013 included an extraordinary effect of 1-6.0 million for refocusing the Permanent Bonding product line. The extraordinary effect primarily included value adjustments for demonstration equipment and inventories as well as capitalized development costs from the years prior to 2008. EBIT in the first half of 2012 included one-time currency effect of 1-0.4 million. This resulted from the settlement of Company-internal foreign currency credits of SUSS MicroTec AG to SUSS MicroTec, Inc. in connection with the acquisition of Tamarack Sientific in March 2012. As a result, adjusted EBIT for the first half of 2013 was 1-9.0 million (previous year: 11.9 million).
In the first half of 2013, all regions except for Europe recorded a decline in order entry compared to the previous year:The region of Europe recorded an increase of approximately 38%, North America a drop of approximately 31%,Japan a drop of 40%, and Rest of Asia a decline of approximately 17%.
Regional sales displayed significant declines in the first half in all regions, except for Rest of Asia.While the region of North America recorded a decline of approximately 35%, Europe reported a decline of 9%, and sales in Japan fell by approximately 71%. Only the region of Rest of Asia recorded a slight increase in sales of approximately 2% compared to the previous year.
Sales by Region in 3 million
H1 2012 H1 2013
The Lithography division comprises the development,manufacture, and sale of the Mask Aligner,Developer, and Coater product lines, as well as laser technology and UV projection lithography. These product lines are developed and produced in Germany at the locations in Garching and Sternenfels and in the USA in Corona, California.
The Lithography division recorded a decline in order entry and sales in the first six months of the 2013 fiscal year. Order entry of 148.6 million was 9.3% below its total of 153.6 million a year earlier.Division sales in the first half of 2013 amounted to 137.1 million after 149.2 million in the first half of the previous year.The gross profit margin declined from 43.4% to 30.0%. The main reasons for this are the shift in product mix from 300mm systems to 200mm tools and the still below average margin of SUSS MicroTec Photonic Systems. The segment EBIT decreased because of the low sales level as well as the lower margins from 110.2 million to 10.2 million.
The Substrate Bonder division comprises the development,production, and sale of the Substrate (Wafer) Bonder product line and is located at our site in Sternenfels (Germany).
In the first half of the year,the Substrate Bonder division recorded a significant increase in order entry,reaching 117.2 million after 17.2 million in the previous year's period.However, sales declined from 18.8 million in the previous year to 16.6 million.The gross profit margin dropped significantly from -8.6% to -134.3%.Division earnings were correspondingly lower,falling to 1-14.5 million (H1 2012: 1-6.1 million).Weak earnings resulted from continued high research and development costs and additional demands from several customer-oriented projects in the first half of 2013. Results from the second quarter of 2013 also include an extraordinary effect of 16.0 million from refocusing the Permanent Bonding product line.
H1 2012 H1 2013
The Photomask Equipment division comprises the development, manufacture, and sale of the HMx, ASx, MaskTrack, and MaskTrack Pro product lines. The development and production of specialized systems for the cleaning and processing of photomasks for the semiconductor industry are also conducted at the Sternenfels site in Germany.
The Photomask Equipment division recorded lower order entry of 13.4 million in the first half of 2013 (H1 2012: 117.2 million) as well as higher division sales of 19.2 million (H1 2012: 17.4 million). The gross profit margin in this division rose from 21.2% to 25.1%. Accordingly, division earnings improved to 1-0.2 million in the first half of 2013 (H1 2012: 1-1.3 million).
The Others division comprises Micro-optics activities at the Hâuterive, Switzerland, location, the C4NP business, as well as the costs for central Group functions that generally cannot be attributed to the main divisions. Ownership of the Micro-optics business was boosted to 100% in the first half of 2012. In this way,the company, which commands important enabling technologies, was even more closely tied to SUSS MicroTec.
At 12.0 million, division sales hardly changed from the previous year. Order entry remained at 12.4 million, the same as in the first half of 2012. Division earnings of 1-0.4 million improved significantly from 1-1.3 million in the previous year.
In the first half of 2013, sales of the SUSS MicroTec Group totaled 155.0 million,or18.5% less than in the first half of 2012 (167.5 million). EBIT in the first half of 2013 amounted to 1-15.0 million. In the first half of 2012, SUSS MicroTec still managed to achieve EBIT of 11.5 million. EBIT in the first half of 2013 was impacted by value adjustments and additional provisions of 16.0 million, which were formed in connection with the refocusing of the Permanent Bonding product line. In the previous year, a"profit from discontinued operations"of 11.5 million was recorded,reflecting retroactive proceeds from the sale of the Test business.
As in previous quarters, the largest sales driver was the Lithography division,which resulted in sales of 137.1 million and an EBIT of 10.2 million.The Lithography division thus contributed approximately 67% of Group sales. In the first half of the previous fiscal year, the SUSS MicroTec Group's Lithography division generated sales of 149.2 million and an EBIT of 110.2 million. In the previous year,the Lithography division accounted for almost 73% of Group sales.
In the first half of 2013, sales in the Substrate Bonder division totaled approximately 16.6 million.As of June 30, 2013,the EBIT of the Substrate Bonder division amounted to 1-14.5 million.This includes extraordinary expenses of 16.0 million,which accrued in connection with the refocusing of the Permanent Bonding product line. For this, value adjustments of 14.6 million on capitalized development costs,demonstration equipment,and other inventories as well as provisions of 11.4 million for commitments received and other agreements were formed. Without these extraordinary expenses,the EBIT of the Substrate Bonder division would have come to 1-8.5 million. In the first half of 2012, this division achieved EBIT of 1-6.1 million with sales of 18.8 million. In the first half of 2013,the Photomask Equipment division generated sales of 19.3 million,after generating sales of 17.4 million in the previous year's period. In the first half of 2013,the Photomask Equipment division's EBIT was slightly negative at 1-0.2 million. In the first half of 2012, EBIT of 1-1.3 million was achieved.
The cost of sales included write-downs of 12.0 million on capitalized development costs. This amount also included extraordinary write-downs of 11.2 million on capitalized development costs of the Substrate Bonder division, which were carried out in connection with the refocusing of the Permanent Bonding product line. In the first half of 2012, write-downs of 11.3 million on capitalized development costs were recognized. In both 2013 and 2012, only minor capitalizations in the five-digit range were carried out. Following extraordinary write-downs, capitalized development costs of the Substrate Bonder division had a book value of zero. The remaining book value of approximately 11.0 million as of June 30, 2013 is entirely attributable to the Lithography division.
The gross profit decreased by 118.1 million compared with the previous year's period, amounting to 16.8 million in the first half of 2013.The gross profit margin declined from 36.9% in the same period of the previous year to 12.4%. The gross profit in the first half of 2013 was impacted by extraordinary expenses of 14.7 million,which were accrued in connection with the refocusing of the Permanent Bonding product line. Without these extraordinary expenses,the gross profit in the first half of 2013 would have amounted to approximately 111.5 million, corresponding to a gross profit margin adjusted for extraordinary effects of 20.9%.The low gross profit margin is primarily attributable to a relatively high sales share for the Substrate Bonder division,which – also adjusted for extraordinary effects – led to another large negative gross profit in the first half of 2013. The sales of SUSS MicroTec Photonic Systems (previously Tamarack), which are allocated to the Lithography division, also generated a slightly negative gross profit. In addition,much lower margins were recorded for the Coater product line in the first half of 2013, while the gross profit margins of the Mask Aligner product line remained constant at higher than 40%. The gross profit margin in the Photomask Equipment division improved slightly in the first half of 2013 compared with the previous year's period.
It was possible to further reduce administration and selling costs through the systematic and continued implementation of the cost-saving program. Overall, administration and selling costs of 116.2 million were incurred,representing an expense ratio of 29.5% relative to sales generated. In the same period of the previous year, corresponding costs of 118.1 million were recorded, representing approximately 26.7% of sales generated.
Research and development costs totaled 15.3 million in the first half of 2013, compared with 14.4 million in the same period of the previous year.The amount includes extraordinary expenses of 11.3 million, which accrued in connection with the refocusing of the Permanent Bonding product line.
Other operating income of 11.7 million consisted primarily of foreign currency gains.During the corresponding period of the previous year,other operating income similarly recognized 11.7 million of primarily foreign currency gains.Other operating expenses of 11.9 million primarily comprised foreign currency losses. In addition, lump-sum value adjustments were recognized here on customer receivables,which have been due for more than a year. In the first half of 2012,other operating expenses of 12.6 million resulted primarily from foreign currency losses.
The financial result for the first half of 2013 amounted to 10.2 million, reflecting interest income, interest expenses, and gains from the sale of securities.The financial result of 10.1 million in the previous year's period resulted primarily from interest income and expenses.
In the first half of 2013, tax income of 13.2 million was recognized. This resulted in a consolidated tax rate that significantly deviated from the average consolidated tax rate of approximately 28%.This development is essentially due to the fact that it was not possible to recognize deferred tax assets for the losses incurred by foreign subsidiaries. In the previous year,tax expense of 11.3 million was recognized.
As a result of the sale of the Test Systems business on January 28, 2010, a total of 12.5 million of the purchase price was placed in escrow. Release was dependent on certain conditions that SUSS MicroTec had to fulfill after the transaction. At the beginning of 2012, the escrow accounts reported a remaining amount of 11.5 million. On January 27, 2012 (24 months after the conclusion of the purchase contract), the relevant conditions were deemed fulfilled.The amount of 11.5 million was released to SUSS MicroTec AG in February 2012 and recognized with effect on net income. In the previous year,the income was recognized under"profit from discontinued operations."
The SUSS MicroTec Group's net cash position – the balance from cash and cash equivalents, interest-bearing securities, and financial liabilities – fell by approximately 112.8 million when compared with December 31, 2012,to approximately 119.5 million.
Before consideration of securities purchases and sales as well as acquisitions of subsidiaries, free cash flow was negative in the first half of the year at 1-12.4 million. One reason for this was negative cash flow from operating activities of 1-10.6 million. Another reason was negative cash flow from investing activities of 1-1.8 million. In the first half of 2012, free cash flow was also negative at 1-7.1 million.
Cash flow from operating activities was primarily impacted by negative operating income. The SUSS MicroTec Group also recorded an increase in inventories, particularly of tools, which had already been delivered to customers but for which final acceptance was still outstanding. In addition, inventories of demonstration equipment in the Lithography division increased slightly. The purchase of inventories resulted in the outflow of approximately 18.1 million in cash and cash equivalents.An offsetting factor was a reduction in trade receivables by approximately 16.7 million, which resulted from both the Lithography and Substrate Bonder divisions and was attributable to lower sales in the first half of 2013. It was possible to increase the amount of customer down payments in the first half of 2013, leading to inflows of approximately 13.3 million. However, this positive effect was offset by the high tax payments of all Group companies,which summed up to approximately 11.0 million in
the first half of 2013, as well as lower trade payables as of the reporting date, which led to a cash outflow of approximately 12.0 million. In the first half of 2013, total cash flow from operating activities was 1-10.6 million.
Cash flow from investing activities totaled 1-1.8 million, excluding investments in securities and the acquisition of subsidiaries.The largest capital expenditure items in the first half of 2013 involved various renovations and expansions of the Sternenfels facility,the acquisition of business and office equipment,and the purchase of administrative software. In addition, a cleanroom was completed in the newly leased building of Suss MicroOptics S.A.,Hauterive (Switzerland),which required capital expenditure of approximately 10.8 million in the first half of 2013.
Cash flow from financing activities reflected the repayment of a bank loan and the reduction of other financial liabilities.
Besides cash and cash equivalents of 19.3 million (December 31, 2012:125.2 million) and securities of 114.1 million (December 31, 2012: 111.4 million), the Group had credit and guarantee lines of 18.0 million as of the half-year reporting date, which were predominantly secured in line with banking practice and were not bound to financial covenants. The utilization of these credit lines amounted to 12.4 million as of the half-year reporting date and primarily related to down payment guarantees for customer down payments.Thus,the Group has sufficient funds at its disposal to finance the operational business.
Noncurrent assets totaled 1 38.6 million as of the half-year reporting date and were thus 11.3 million higher than on December 31, 2012.The amount of deferred tax assets,which were capitalized in connection with ongoing losses at the German companies, accounted for most of this increase.By contrast,the book value of intangible assets declined by 12.4 million to 15.1 million in the first half of 2013. In part,the decline resulted from writedowns,which came to approximately 11.5 million and were offset by new investments of only 10.3 million. It also reflects extraordinary write-downs of approximately 11.2 million on capitalized development costs in the Substrate Bonder division. Ongoing investments in tangible assets amounted to approximately 11.5 million, including capital expenditure for the installation of a cleanroom at Suss MicroOptics S.A., Hauterive (Switzerland), which entailed additional acquisition costs of 10.8 million in the first half of 2013.The remaining investments involved renovation and expansion of the facility in Sternenfels and the acquisition of business and office equipment. An offsetting factor was the depreciation of tangible assets totaling 11.2 million.
Current assets of the Group decreased by 115.8 million from 1143.1 million (December 31, 2012) to 1127.3 million as of the half-year reporting date.
The negative cash flow generated in the first half of the year and the acquisition of securities led to a sharp decline in the level of cash and cash equivalents,which still amounted to 19.4 million as of June 30, 2013 (after 125.2 million as of December 31, 2012). However,the portfolio of securities increased in the first half of 2013 by 12.7 million to 114.1 million as of the half-year reporting date. In the first six months of the current fiscal year, securities were acquired for approximately 115.0 million with available cash and cash equivalents. Securities valued at approximately 110.0 million reached their maturity date in this half of the year and were redeemed. Securities valued at approximately 12.0 million were sold before reaching their maturity date. The securities recognized consist of corporate and government bonds as well as commercial paper.
Trade receivables also declined significantly by 17.9 million to 113.9 million, reflecting relatively low sales in the first half of the year. The decline resulted from the Lithography and Substrate Bonder divisions, which generated relatively low sales in the first half of 2013.
By contrast, reported inventories increased further as of June 30, 2013.As of the half-yearreporting date,the gross amount of inventories totaled 1102.9 million, approximately 17.5 million higher than as of December 31, 2012.The sharp increase is almost exclusively attributable to the high inventory of tools, which had already been delivered to end customers but for which final acceptance (and therefore revenue recognition) was still outstanding. However, the inventories of materials, supplies, and unfinished goods declined as of December 31, 2012. Similarly, the value adjustments made for inventory have increased significantly from the end of the previous year, totaling approximately 116.7 million as of June 30, 2013 (after 113.3 million as of December 31, 2012). Of this amount, approximately 19.3 million (December 31, 2012:16.7 million) was attributable to write-downs for demonstration equipment.The additional value adjustments include extraordinary expenses of 13.5 million,which were recognized in connection with the refocusing of the Permanent Bonding product line.
The rise in other assets from 11.7 million as of December 31, 2012 to 12.9 million resulted primarily from much higher VAT receivables, which arose due to the reporting date.
The shareholders' equity of the SUSS MicroTec Group has decreased since December 31, 2012 by 112.3 million to 1114.9 million. The equity ratio declined from 71.1% to 69.3%.
With the purchase agreement datedMay 14,2012,SUSS MicroTec AG acquired 15% of the shares of Suss MicroOptics S.A., Hauterive (Switzerland), thereby boosting its majority stake from 85% to 100%. The fixed purchase price totaled CHF 1.35 million and was paid in May 2012. Aside from the fixed purchase price, a variable purchase price was agreed with the sellers. It will be paid between 2013 and 2015.The variable purchase price amounts to approximately CHF 0.45 million (nominal); corresponding provisions were recognized as liabilities. In accordance with IAS 27,the acquisition was recognized as an equity transaction.The difference in amount between the total purchase price of CHF 1.8 million and the lower book value of the acquired minority shares came to approximately 10.8 million and was recognized under consolidated capital surplus.
Additional details about the development of consolidated equity are presented in the consolidated statement of shareholders' equity.
Noncurrent liabilities declined by 10.2 million from 111.0 million to 110.8 million. The decline resulted from a slight reduction in pension provisions, other provisions, and lower financial debt. However, deferred tax liabilities and other financial liabilities have increased slightly.
In the first half of 2013, current liabilities similarly declined by 11.9 million to 140.3 million. In part, other financial liabilities decreased by 10.8 million to 16.0 million because lower commitments for bonuses were recognized due to the reporting date. In addition,trade payables fell by 12.1 million to 14.8 million. Furthermore, a decline in tax liabilities by 10.7 million to 10.4 million was recognized because the companies of the SUSS MicroTec Group made tax payments of 11.0 million in the first half of 2013. However,the level of customer down payments, which amounted to approximately 120.9 million as of June 30, 2013 (compared with 117.6 million as of December 31, 2012), increased.As of June 30, 2012 the down payment level was higher by 19.4 million.
As of June 30, 2013, the Group had 680 employees within the individual companies (June 30, 2012: 689 employees).
Global activities in the field of high technology yield general and current risks for the Company.The Management Board has taken appropriate measures for the purpose of monitoring risks in order to identify developments that may threaten the continued existence of the SUSS MicroTec Group early on. The risk management system has long been a component of corporate management for the purpose of recognizing and controlling risks, and for meeting legal requirements.
In risk monitoring, a fundamental distinction is made between general business and industry risks, operating risks, and financial market risks.
The Company identifies general business risks as underlying political and economic conditions, cyclical market fluctuations and developments,market positioning, and dependence on the expertise of individuals. These risks are described in the Company's most recent Annual Report in the corresponding Risk Report section.
There were no substantial changes to the risks and opportunities outlined in the most recent Annual Report during the first half of the current fiscal year.
SUSS MicroTec regards operating risks as those which have an impact on the Group's assets and earnings position as a result of potentially necessary write-downs in the consolidated statement of financial position due to the difficult economic environment. Pricing pressure and legal risks, in particular liability risks, represent additional operating risks. Each of these risk types was outlined in detail in the most recent Annual Report. In addition, reference was made to the subdued development in the Substrate Bonder division, where further losses are expected. Furthermore, the last Annual Report discussed the loss situation to date at Tamarack Scientific, Inc.,Corona (now: SUSS MicroTec Photonic Systems Inc.).
In the first half of 2013, the earnings position of the Substrate Bonder division continued to deteriorate.Therefore, in the second quarter of 2013, SUSS MicroTec took appropriate measures and decided to reposition the Substrate Bonder division.With the ad hoc announcement on May 7, 2013, SUSS MicroTec announced its decision to focus the Permanent Bonding product line on MEMS and LED applications.The Company will continue its policy of concentrating on the Temporary Bonding product line.With this step, the Company takes into account the technological advancement of the product portfolio and the market development in recent years.
The repositioning of the Substrate Bonder division is primarily intended to drive its future growth. However, the risk remains that the Substrate Bonder division in the current configuration will produce losses on a continuing basis. Positive earnings will presumably only be achievable in this division through a combination of much higher order entry and higher quantities produced per tool type. If SUSS MicroTec does not achieve sustainable success with the recently decided repositioning of the division, additional measures will need to be taken in order to end the loss situation at the Substrate Bonder division over the long term.
In March 2012, SUSS MicroTec acquired 100% of the shares in Tamarack Scientific, Inc.,Corona (USA).The UV projection lithography devices and laser microstructuring systems developed by Tamarack (now: SUSS MicroTec Photonic Systems Inc.) offer SUSS MicroTec the possibility of expanding its own productrange. SUSS MicroTec expects that,given the technologies developed by SUSS MicroTec Photonic Systems, it will be possible to approach more customers, especially in the area of advanced packaging, 3D integration, and MEMS as well as tap into new businesses. However, so far the earnings development at the newly acquired company has been subdued.The expected volume of new orders for the products at SUSS MicroTec Photonic Systems have not yet materialized. In addition, the company produced a slightly negative gross profit with the sales generated until now.The risk exists that earnings of the Lithography division,to which the new products are allocated,will also be impacted by a negative contribution to earnings by SUSS MicroTec Photonic Systems in the coming periods.The break-even sales level of the SUSS MicroTec Group could be negatively affected by the integration of the new company on a continuing basis. Nevertheless, SUSS MicroTec continues to assume a successful, albeit delayed, integration of photonic systems technology into the existing product portfolio and is targeting an improvement in margins.
Regarding other operating risks, there were no substantial changes to the risks and opportunities outlined in the 2012 Annual Report in the first half of 2013.
At the SUSS MicroTec Group, financial market risks encompass credit risks, liquidity risks, and market price risks.The 2012 Annual Report provided an extensive description of these risks.
No substantial changes to these risks and opportunities occurred in the first half of the year.
No risks that threaten the Company's existence were identified within the Group in the first half of the 2013 fiscal year.The continued existence of the Company was at no time endangered from a material assets and liquidity point of view.
The risk management system described in the 2012 Annual Report continued to be used in the first half of 2013.
No material events requiring disclosure occurred after the end of the interim reporting period.
In the first half of 2013 and the 2012 fiscal year, there were no material transactions with related parties subject to the disclosure requirements of IAS 24.
The business environment in which SUSS MicroTec operates is influenced by regional and global economic conditions as well as industry developments. The following forecast report provides an explanation of internal and external factors that both the Company and leading market and industry observers regard as essential for the development of the Company.
Although the development of the world economy continues to be disappointing, initial positive signs of a global recovery are evident, according to an OECD study.The reason for this development is the robust economic situation in the USA and in various emerging economies,which has offset the deepening recession in the eurozone.The greatest risk factor for a further recovery of the global and European economy is a renewed escalation of the euro crisis. If this does not materialize, the outlook for Europe is very positive. After a weak half of the year during the winter period, the economy is expect to rebound significantly in the second quarter of 2013. In the current year,the real gross domestic product is expected to decline by 0.6%, reflecting the lower base level at the beginning of the year. For 2014,the ifo Institute forecasts renewed growth of approximately 1.4%.An increase in worldwide gross domestic product of 2.9% is assumed for 2013. A further acceleration of economic growth is expected for 2014.
The German economy also got off to a comparatively weak start in 2013. Uncertainty about future economic development has reduced demand by domestic investors and consumers, while exports to the eurozone dropped significantly. In the spring months, the economy regained momentum so that, all in all, the real gross domestic product will probably grow by 0.6% in 2013. Since the overall environment for the German economy remains favorable, a renewed acceleration of growth of 1.9% is anticipated in 2014 in comparison with 2013.
The semiconductor industry is characterized by phases of significant reluctance to invest,which follow cycles with high levels of investment. In 2012, the semiconductor market shrank by approximately 2% to a volume of about US\$ 295 billion. For 2013, the market research institutes IDC and iSuppli expect renewed growth in this sector. The growth rates are expected to remain between 3.5% and 6.4%. However, it should be observed here that the estimates of the market research institutes as of the beginning of 2012 have ultimately deviated significantly from the actual market developments. Therefore, the reliability of the forecast in a relatively volatile market should be viewed as minimal. Minor instability in the global economy or even limited regional events could lead to substantial deviations from projections. Nevertheless, within the context of the expected global economic recovery, the demand for electronic devices should continue to grow this year and lead to increased order entry and sales in the semiconductor sector.
According to the SEMI industry association,the semiconductor equipment industry should see significant growth in investment in 2014 after two restrained years. In 2013, an annual increase in sales of 1.9% is expected for front end equipment. However,the market should experience 24% annual growth already in 2014.
For the specialty area of back end-assembly and packaging,which is particularly relevant for SUSS MicroTec, SEMI anticipates a sales decline of 17.2% in 2013, with renewed growth of 13.7% in 2014. However, according to a study by Gartner (June 2013),the area of wafer-level packaging and assembly will grow by 7.9% in 2013 and by 26.7% in 2014. For all other sectors in the semiconductor industry, such as wafer fab equipment, test equipment, and capital equipment, Gartner is assuming a decline in 2013, but expects renewed growth in 2014.
The market for microelectromechanical systems (MEMS) has been driven by mobile applications in smartphones and tablet computers for some time.According to estimates from Gartner, approximately 1.7 billion smartphones and 120 million tablet computers were sold worldwide in 2012. For 2013, a market volume of approximately 1.8 billion smartphones and 202 million tablet computers is expected. However, the PC market is stagnating or regressing and is expected to reach a unit volume of approximately 300 million sold devices in 2013. Nevertheless, not only unit volume growth but also the electronic contents of the individual mobile devices are growing steadily. Currently, the Yole market research institute counts up to 25 sensors per smartphone. These include MEMS acceleration sensors, MEMS gyroscopes, electronic compasses,MEMS microphones and micro speakers, as well as MEMS switches or MEMS resonators. In the future, these will be supplemented by pressure, humidity, and temperature sensors as well as MEMS autofocus,MEMS touchscreens, or MEMS joysticks. The possible applications of these micro tools currently seem boundless. Biochemical detectors and gas sensors are already being contemplated.
However, in interpreting market figures it should be noted that the equipment market in this segment is not growing as quickly as the MEMS market itself.This is due to the fact that the higher degree of productivity of the systems enables an ever-increasing number of MEMS components to be produced per tool.
Aside from the MEMS market, advanced packaging /waferlevel packaging is the most important area of activity for SUSS MicroTec. According to the Yole market research institute, more than 80% of investments in the mid end in 2012 were used for so-called bumping technologies. For wafer-level packaging (advanced packaging),researchers from Yole Développement are forecasting an average annual growth rate of approximately 12% for the period from 2010 to 2016.
Market expectations for 3D integration and wafer-level packaging have not significantly changed since the publication of the 2012 Annual Report. According to a study by the Yole Développement market research institute,the equipment market for wafer-level packaging and 3D integration should achieve average annual growth of 28% by 2017. SUSS MicroTec is active in this sector with its solutions for temporary and permanent bonding. In March 2013, the Company received the first order from an Asian customer for the initial delivery of tools for pilot serial production in 3D integration.
In the market for compound semiconductors, SUSS MicroTec focuses on the growth segment of light-emitting diodes (LEDs) and, with its product solutions, is particularly targeting manufacturers of high-end light-emitting diodes, i.e. high brightness (HB) and ultra-high brightness (UHB) LEDs. SUSS MicroTec is actively involved in the latest generations of technology,which specifically require thin wafer handling. Following the weak years of 2010 – 2013,renewed growth is expected for the LED industry in 2014.Currently,the relatively high procurement costs for LEDs are the primary obstacle for comprehensive use, for example for street lighting. In the future, the topic of general lighting – and here the experts agree – will gain substantial significance not last of all due to rising demands for energy efficiency and luminous efficacy.
Along with the further expansion of the innovative product portfolio, important measures were taken in the first half of 2013 to secure SUSS MicroTec's future. These include, for example, the purchase of the property at the Garching site.With that acquisition,the Company is ensuring not only lease savings, but also a high degree of operational flexibility in view of Company-specific requirements for the property, and is making a clear commitment to production in Garching.
In addition, given the unsatisfactory earnings situation for the Permanent Bonding product line, the Company has decided to refocus the line, emphasizing MEMS and LED applications.With this step, the Company takes into account the technological advancement of the product portfolio and the market development in recent years. In connection with these measures, in the second quarter of 2013 the Company undertook a value adjustment totaling approximately 16.0 million,which primarily accrues to capitalized development costs from the years prior to 2008 and no longer needed demonstration tools and other inventories. The growth of the Substrate Bonder division will be determined in the future primarily by the Temporary Bonding product line, which already has been able to achieve initial successes in the market.The contribution to sales of the Permanent Bonding product line will initially be approximately at the previous year's level.As a result,the Substrate Bonder division is well positioned to benefit from expected growth in the coming years in the 3D IC, MEMS, and LED key markets.
Given the order backlog and the current economic outlook, we project sales of approximately 1150 million and negative EBIT within the range of 1-10 million to 1-15 million for the entire 2013 fiscal year.
For the third quarter of 2013, we expect order entry within the range of 130 – 40 million.
This Interim Report contains information and forecasts that refer to the future developments of the SUSS MicroTec Group and its companies.The forecasts are assessments that the Company has made based on all of the information available to it at the present time. Should the assumptions on which these forecasts are based not occur or the risks – as addressed in the risk report – arise, the actual results may deviate from those currently expected.
Garching,Germany, August 6, 2013
The Management Board
Frank Averdung Michael Knopp
Chief Executive Officer Chief Financial Officer
for SUSS MicroTec AG
| in 1 thousand | 04/01/2013 – 06/30/2013 |
04/01/2012 – 06/30/2012 |
01/01/2013 – 06/30/2013 |
01/01/2012 – 06/30/2012 |
|---|---|---|---|---|
| Sales | 24,928 | 36,304 | 55,023 | 67,512 |
| Cost of sales | -25,416 | -22,673 | -48,211 | -42,596 |
| Gross profit | -488 | 13,631 | 6,812 | 24,916 |
| Selling costs | -4,280 | -5,103 | -8,729 | -9,555 |
| Research and development costs | -3,095 | -1,977 | -5,327 | -4,366 |
| Administration costs | -3,581 | -4,506 | -7,500 | -8,495 |
| Other operating income | 636 | 951 | 1,657 | 1,680 |
| Other operating expenses | -875 | -1,413 | -1,900 | -2,639 |
| Analysis of net income from operations (EBIT) | ||||
| EBITDA (Earnings before Interest and Taxes, Depreciation and Amortization) |
-9,315 | 3,340 | -11,055 | 4,812 |
| Depreciation and amortization of tangible assets, intangible assets and investments in subsidiaries |
-2,368 | -1,757 | -3,932 | -3,271 |
| Net income from operations (EBIT) | -11,683 | 1,583 | -14,987 | 1,541 |
| Financial income | 212 | 245 | 350 | 465 |
| Financial expense | -92 | -138 | -182 | -361 |
| Financial result | 120 | 107 | 168 | 104 |
| Profit or loss from continuing operations before taxes | -11,563 | 1,690 | -14,819 | 1,645 |
| Income taxes | 2,436 | -1,090 | 3,172 | -1,290 |
| Profit or loss from continuing operations | -9,127 | 600 | -11,647 | 355 |
| Profit or loss from discontinued operations (after taxes) | 0 | 0 | 0 | 1,507 |
| Net profit or loss | -9,127 | 600 | -11,647 | 1,862 |
| Thereof equity holders of SUSS MicroTec | -9,127 | 596 | -11,647 | 1,832 |
| Thereof minority interests | 0 | 4 | 0 | 30 |
| Earnings per share (undiluted) | ||||
| Basic earnings per share from continuing operations in 1 | -0.48 | 0.03 | -0.61 | 0.02 |
| Basic earnings per share from discontinued operations in 1 | 0.00 | 0.00 | 0.00 | 0.08 |
| Earnings per share (diluted) | ||||
| Basic earnings per share from continuing operations in 1 | -0.48 | 0.03 | -0.61 | 0.02 |
| Basic earnings per share from discontinued operations in 1 | 0.00 | 0.00 | 0.00 | 0.08 |
| in 1 thousand | 01/01/2013 –06/30/2013 | 01/01/2012 –06/30/2012 |
|---|---|---|
| Net profit or loss | -11,647 | 1,862 |
| Items that will not be reclassified to profit and loss | ||
| Remeasurements on defined benefit pension plans | 5 | -2 1) |
| Other comprehensive income after tax for items that will not be reclassified to profit and loss |
5 | -2 |
| Items that will be reclassified subsequently to profit and loss | ||
| Fair value fluctuations of available for sale securities | -233 | 94 |
| Foreign currency adjustment | -616 | 1,183 |
| Cash flow hedges | 134 | -105 |
| Deferred taxes | 28 | -29 |
| Other comprehensive income after tax for items that will be reclassified to profit and loss | -687 | 1,143 |
| Total income and expenses recognized in equity | -682 | 1,141 |
| Total income and expenses reported in the reporting period | -12,329 | 3,003 |
| Thereof equity holders of SUSS MicroTec | -12,329 | 2,966 |
| Thereof minority interests | 0 | 39 |
1) Since January 1, 2013,the SUSS MicroTec Group applies IAS 19 (revised). This change in accounting policy was recognised retrospectively and comparatives 2012 have been restated. The impacts resulting from the adjustment are described in the selected explanatory notes (Point 3.2).
| in 1 thousand Ass ets |
06/30/2013 | 12/31/2012 |
|---|---|---|
| Non-current assets | 38,647 | 37,325 |
| Intangible assets | 5,145 | 7,504 |
| Goodwill | 15,410 | 15,394 |
| Tangible assets | 12,280 | 12,068 |
| Tax refund claims | 80 | 80 |
| Other assets | 567 | 773 |
| Deferred tax assets | 5,165 | 1,5061) |
| Current assets | 127,275 | 143,088 |
| Inventories | 86,182 | 82,179 |
| Trade receivables | 13,940 | 21,758 |
| Other financial assets | 474 | 547 |
| Securities | 14,121 | 11,394 |
| Tax refund claims | 230 | 295 |
| Cash and cash equivalents | 9,385 | 25,192 |
| Other assets | 2,943 | 1,723 |
| Total assets | 165,922 | 180,413 |
1) Since January 1, 2013,the SUSS MicroTec Group applies IAS 19 (revised). This change in accounting policy was recognised retrospectively and comparatives 2012 have been restated. The impacts resulting from the adjustment are described in the selected explanatory notes (Point 3.2).
| EQUITY in 1 thousand | 06/30/2013 | 12/31/2012 | ||
|---|---|---|---|---|
| Equity | 114,863 | 127,193 | ||
| Total equity attributable to shareholders of SUSS MicroTec AG | 114,863 | 127,193 | ||
| Subscribed capital | 19,116 | 19,116 | ||
| Reserves | 98,296 | 109,944 | ||
| Accumulated other comprehensive income | -2,549 | -1,867 1) | ||
| Minority interests | 0 | 0 | ||
| Non-current liabilities | 10,761 | 11,039 | ||
| Pension plans and similar commitments | 3,930 | 4,119 1) | ||
| Provisions | 113 | 296 | ||
| Financial debt | 3,795 | 3,981 | ||
| Other financial liabilities | 2,754 | 2,577 | ||
| Deferred tax liabilities | 169 | 66 | ||
| Current liabilities | 40,298 | 42,181 | ||
| Provisions | 3,416 | 3,602 | ||
| Tax liabilities | 352 | 1,050 | ||
| Financial debt | 194 | 288 | ||
| Other financial liabilities | 5,977 | 6,815 | ||
| Trade payables | 4,754 | 6,862 | ||
| Other liabilities | 25,605 | 23,564 | ||
| Total liabilities and shareholders' equity | 165,922 | 180,413 |
1) Since January 1, 2013,the SUSS MicroTec Group applies IAS 19 (revised). This change in accounting policy was recognised retrospectively and comparatives 2012 have been restated. The impacts resulting from the adjustment are described in the selected explanatory notes (Point 3.2).
| in 1 thousand | 01/01/2013 –06/30/2013 | 01/01/2012 –06/30/2012 |
|---|---|---|
| Net profit or loss (after taxes) | -11,647 | 1,862 |
| Amortization of intangible assets | 2,711 | 2,285 |
| Depreciation of tangible assets | 1,221 | 986 |
| Profit or loss on disposal of intangible and tangible assets | -6 | 0 |
| Profit on disposal of available-for-sale securities | -70 | 0 |
| Change of reserves on inventories | 4,160 | 2,634 |
| Change of reserves for bad debts | 645 | 129 |
| Non-cash income from the reversal of provisions | -9 | 0 |
| Other non-cash effective income and expenses | 142 | 212 |
| Acquisition costs Tamarack | 0 | 242 |
| Gain from subsequent purchase price payment Test business | 0 | -1,507 |
| Change in inventories | -8,072 | -16,656 |
| Change in trade receivables | 6,743 | 5,289 |
| Change in other assets | -876 | -959 |
| Change in pension provisions | -189 | 87 |
| Change in trade payables | -2,042 | 7 |
| Change in other liabilities and other provisions | 250 | 405 |
| Change of deferred taxes | -3,556 | 453 |
| Cash flow from operating activities | -10,595 | -4,531 |
| SuSS MicroTec AG | Financial Report | 027 |
|---|---|---|
| in 1 thousand | 01/01/2013 –06/30/2013 | 01/01/2012 –06/30/2012 |
|---|---|---|
| Disbursements for tangible assets | -1,478 | -1,978 |
| Disbursements for intangible assets | -331 | -549 |
| Purchases of current available-for-sale securities | -5,986 | -14,875 |
| Proceeds from redemption of available-for-sale securities | 3,097 | 4,031 |
| Proceeds from subsequent selling price for Test business | 0 | 1,507 |
| Payments for purchase of Tamarack | 0 | -5,426 |
| Cash flow from investing activities | -4,698 | -17,290 |
| Repayment of bank loans | -180 | -180 |
| Change in current bank liabilities | -94 | -196 |
| Change in other financial debt | -6 | -277 |
| Payments for purchase of shares in SUSS MicroOptics | 0 | -1,126 |
| Proceeds from exercise of subscription rights | 0 | 18 |
| Cash flow from financing activities | -280 | -1,761 |
| Adjustments to funds caused by exchange-rate fluctuations | -234 | 146 |
| Change in cash and cash equivalents | -15,807 | -23,436 |
| Funds at beginning of the year | 25,192 | 37,036 |
| Funds at end of the period | 9,385 | 13,600 |
| Cash flow from operating activities includes | ||
| Interest paid during the period | 96 | 114 |
| Interest received during period | 287 | 555 |
| Tax paid during the period | 980 | 7,010 |
| Tax refunds during the period | 0 | 0 |
| Additional | ||||
|---|---|---|---|---|
| in 1 thousand | Subscribed capital | paid-in capital | Earnings reserve | Retained earnings |
| As of January 01, 2012 | 19,101 | 98,383 | 433 | 2,799 |
| Adjustments1) | ||||
| As of January 01, 2012 (adjusted) | 19,101 | 98,383 | 433 | 2,799 |
| Net loss | 1,832 | |||
| Total income and expenses recognized in equity | ||||
| Total comprehensive income | 1,832 | |||
| Issuance of subscription rights | 15 | 4 | ||
| Purchase of SMO shares | -773 | |||
| As of June 30, 2012 | 19,116 | 97,614 | 433 | 4,631 |
| As of January 01, 2013 | 19,116 | 97,614 | 433 | 11,896 |
| Adjustments1) | ||||
| As of January 01, 2013 (adjusted) | 19,116 | 97,614 | 433 | 11,896 |
| Net loss | -11,647 | |||
| Total income and expenses recognized in equity | ||||
| Total comprehensive income | -11,647 | |||
| As of June 30, 2013 | 19,116 | 97,614 | 433 | 249 |
1) Since January 1, 2013,the SUSS MicroTec Group applies IAS 19 (revised). This change in accounting policy was recognised retrospectively and
comparatives 2012 have been restated.
2) Actuarial valuations of the actuarial gains and losses are only compiled as of December 31 each year. Present amounts exclusively result from adjustments due to exchange-rate fluctuations.
| Equity | Minority interests | Total equity attributable to shareholders of Suss MicroTec AG |
Accumulated other comprehensive income | |||
|---|---|---|---|---|---|---|
| Fair value fluctua tions of available for sale securities |
Cash flow hedges | Foreign currency adjustments |
Remeasurements on defined benefit pension plans |
|||
| 120,393 | 689 | 119,704 | 172 | -226 | -959 | 0 |
| -412 | -412 | -412 | ||||
| 119,981 | 689 | 119,292 | 172 | -226 | -959 | -412 |
| 1,862 | 30 | 1,832 | ||||
| 1,141 | 9 | 1,132 | 67 | -76 | 1,143 | -22) |
| 3,003 | 39 | 2,964 | 67 | -76 | 1,143 | -2 |
| 19 | 19 | |||||
| -1,501 | -728 | -773 | ||||
| 121,501 | 0 | 121,501 | 239 | -302 | 184 | -414 |
| 128,107 | 0 | 128,107 | 179 | -363 | -768 | 0 |
| -915 | -915 | -915 | ||||
| 127,192 | 0 | 127,192 | 179 | -363 | -768 | -915 |
| -11,647 | -11,647 | |||||
| -682 | -682 | -168 | 95 | -614 | 5 2) | |
| -12,329 | 0 | -12,329 | -168 | 95 | -614 | 5 |
| 114,863 | 0 | 114,863 | 11 | -268 | -1,382 | -910 |
| in 1 thousand | Lithography | Substrate Bonder | Photomask Equipment | |||
|---|---|---|---|---|---|---|
| 6M/ 2013 | 6M/ 2012 | 6M/ 2013 | 6M/ 2012 | 6M/ 2013 | 6M/2012 | |
| External Sales | 37,135 | 49,246 | 6,636 | 8,834 | 9,239 | 7,398 |
| Internal Sales | 0 | 0 | 0 | 0 | 0 | 0 |
| Total Sales | 37,135 | 49,246 | 6,636 | 8,834 | 9,239 | 7,398 |
| Result per segment (EBIT) | 185 | 10,168 | -14,497 | -6,071 | -227 | -1,263 |
| Income before taxes | 121 | 10,162 | -14,497 | -6,071 | -230 | -1,264 |
| Significant non-cash items | -380 | -538 | -5,204 | -1,590 | -689 | -392 |
| Segment assets | 77,051 | 86,459 | 31,557 | 35,565 | 12,474 | 15,200 |
| thereof Goodwill | 15,410 | 17,642 | 0 | 0 | 0 | 0 |
| Unallocated assets | ||||||
| Total assets | ||||||
| Segment liabilities | -25,101 | -35,247 | -8,140 | -6,129 | -2,187 | -6,847 |
| Unallocated liabilities | ||||||
| Total liabilities | ||||||
| Depreciation and amortisation | 1,106 | 1,050 | 1,912 | 1,091 | 182 | 306 |
| thereof scheduled | 1,106 | 1,050 | 1,912 | 1,091 | 182 | 306 |
| thereof impairment loss | 0 | 0 | 1,156 | 0 | 0 | 0 |
| Capital expenditure | 268 | 5,442 | 56 | 132 | 121 | 31 |
| Workforce at June 30 | 409 | 411 | 116 | 132 | 103 | 105 |
| in 1 thousand | Sales (continuing operations) Capital expenditure |
Assets (without Goodwill) |
||||||
|---|---|---|---|---|---|---|---|---|
| 6M/ 2013 | 6M/ 2012 | 6M/ 2013 | 6M/ 2012 | 6M/ 2013 | 6M/2012 | |||
| Europe | 16,123 | 17,761 | 1,687 | 2,064 | 90,848 | 104,235 | ||
| North-America | 9,330 | 14,246 | 45 | 5,018 | 21,760 | 22,280 | ||
| Japan | 2,623 | 9,148 | 4 | 0 | 2,448 | 2,774 | ||
| Rest of Asia | 26,947 | 26,357 | 72 | 20 | 2,051 | 1,759 | ||
| Consolidation effects | 0 | 0 | 0 | 0 | 440 | -1,194 | ||
| Total | 55,023 | 67,512 | 1,808 | 7,102 | 117,547 | 129,854 |
| Other | Continuing operations | Discontinued Operations (Test business) |
Consolidation effects | Total | ||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 6M/ 2013 | 6M/2012 | 6M/ 2013 | 6M/ 2012 | 6M/2013 | 6M/ 2012 | 6M/ 2013 | 6M/ 2012 | 6M/ 2013 | 6M/ 2012 | |||||||||||||||||||
| 2,013 | 2,034 | 55,023 | 67,512 | 0 | 0 | - | - | 55,023 | ||||||||||||||||||||
| 2,538 | 4,172 | 2,538 | 4,172 | 0 | 0 | -2,538 | -4,172 | 0 | ||||||||||||||||||||
| 4,551 | 6,206 | 57,561 | 71,684 | 0 | 0 | -2,538 | -4,172 | 55,023 | ||||||||||||||||||||
| -448 | -1,293 | -14,987 | 1,541 | 0 | 1,507 | - | - | -14,987 | ||||||||||||||||||||
| -213 | -1,182 | -14,819 | 1,645 | 0 | 1,507 | - | - | -14,819 | ||||||||||||||||||||
| -78 | 5 | -6,351 | -2,515 | 0 | 0 | - | - | -6,351 | ||||||||||||||||||||
| 11,875 | 10,272 | 132,957 | 147,496 | 0 | 0 | - | - | 132,957 | ||||||||||||||||||||
| 0 | 0 | 15,410 | 17,642 | 0 | 0 | - | - | 15,410 | ||||||||||||||||||||
| 32,965 | ||||||||||||||||||||||||||||
| 165,922 | ||||||||||||||||||||||||||||
| -1,494 | -2,682 | -36,922 | -50,905 | 0 | 0 | - | - | -36,922 | ||||||||||||||||||||
| -14,137 | ||||||||||||||||||||||||||||
| -51,059 | ||||||||||||||||||||||||||||
| 732 | 824 | 3,932 | 3,271 | 0 | 0 | - | - | 3,932 | ||||||||||||||||||||
| 732 | 824 | 3,932 | 3,271 | 0 | 0 | - | - | 3,932 | ||||||||||||||||||||
| 0 | 0 | 1,156 | 0 | 0 | 0 | - | - | 1,156 |
Capital expenditure 268 5,442 56 132 121 31 1,363 1,497 1,808 7,102 0 0 - - 1,808 7,102 Workforce at June 30 409 411 116 132 103 105 52 41 680 689 0 0 - - 680 689
of SUSS MicroTec AG as of June 30, 2013
The consolidated financial statements of SUSS MicroTec AG as of December 31, 2012, have been prepared in accordance with the International Financial Reporting Standards (IFRS) applied by the International Accounting Standards Board (IASB) as of the closing date.The consolidated interim financial statements as of June 30, 2013,which were prepared on the basis of International Accounting Standards (IAS) 34 "Interim Financial Reporting," do not contain all of the necessary information as required for the preparation of the Annual Report and should be read in conjunction with the consolidated financial statements of SUSS MicroTec AG as of December 31, 2012. In the interim financial statements as of June 30, 2013,the same accounting methods were applied as in the consolidated financial statements for the 2012 fiscal year.
All of the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) in effect as of June 30, 2013, have been applied.
The following new IFRS standards to be applied since January 1, 2013, are relevant for SUSS MicroTec
Amendments to IAS 1 (Presentation of the Financial Statements) Amendments to IAS 19 (Employee Benefits)
The retroactive application of the amended IAS 19 led to the complete recording in the statement of financial position of actuarial losses related to pension provisions, which were recognized with a time lag as of December 31, 2012 using the corridor method. The previous year's figures were adjusted accordingly.
For additional information about specific accounting and measurement methods,please see the consolidated financial statements of SUSS MicroTec AG as of December 31, 2012.
The Group auditor has neither audited nor reviewed the interim financial statements.
The consolidated financial statements include the financial statements of SUSS MicroTec AG and of all material companies over which, independent of the level of its participatory investment, the proprietary company can exercise control (i.e. the control principle).
Compared with the consolidated financial statements as of December 31, 2012,there were no changes to the scope of consolidation.
SUSS MicroTec Group has various credit facilities with national and international banks and insurance companies. The credit and guarantee line of 17.5 million provided by the bank consortium led by BayernLB and with the participation of Deutsche Bank AG and DZ Bank AG remained in effect until March 31, 2013.
As of April 1, 2013, SUSS MicroTec AG and SUSS MicroTec Lithography GmbH concluded new credit agreements with the bank consortium.The new credit agreements resulted in credit and guarantee lines totaling 14.5 million.The new credit lines were granted until further notice and were issued without covenants.Their primary purpose is to serve as backing for down payment guarantees.
SUSS MicroTec AG has decided to reduce the guarantee lines because the previously available lines have by no means been exhausted. As of June 30, credit and guarantee lines of 18.0 million, of which 12.4 million were utilized in the form of guarantees, were available to SUSS MicroTec Group.
The following changes resulted from the initial application of IAS 19 (2011).
The SUSS MicroTec Group maintains defined benefit pension plans in Germany,Japan, and Switzerland.Using the corridor method, actuarial losses of 11,242 thousand were not recognized as of December 31, 2012. Pension plans are discussed in detail in the 2012 Annual Report (Notes to the IFRS consolidated financial statements, Item 22).
SUSS MicroTec AG applied IAS 19 (2011) for the first time retrospectively and adjusted the comparative figures accordingly. In the process,the pension provision as of December 31, 2012 / January 1, 2013 was increased by 11,242 thousand; in exchange,the deferred tax assets increased by 1327 thousand. Accumulated other comprehensive income was adjusted by 1-915 thousand.
As of December 31, 2011 / January 1, 2012,the adjustment amount in accumulated other comprehensive income came to 1-412 thousand.Itresulted from (so far unrecognized) actuarial losses of 1551thousand and corresponding deferred tax assets of 1139 thousand.
The following change results from the new rules in IAS 1:
The items in other comprehensive income must be divided into two categories: Items that are recorded in later periods via the statement of income are disclosed separately from items that remain in other comprehensive income.
SUSS MicroTec AG has provided the necessary information in the statement of comprehensive income and in the statement of changes in equity. The comparative figures were adjusted accordingly.
In May 2013, SUSS MicroTec AG announced a repositioning of the Substrate Bonder division1). The Company decided to focus the Permanent Bonding product line on MEMS and LED applications in order to address the unsatisfactory earnings level so far. The Company will continue its policy of concentrating on the Temporary Bonding product line, which will mainly drive the future growth of the Substrate Bonder division.With this step,the Company takes into account the technological advancement of the product portfolio and the market development in recent years.
In connection with these measures, SUSS MicroTec AG undertook a non-cash value adjustment of approximately 14.6 million,which primarily accrues to capitalized development services from the years prior to 2008 and no longer needed demonstration equipment and other inventories. In addition, provisions of 11.4 million were formed for commitments received and other agreements. As a result, extraordinary expenses for refocusing the Permanent Bonding product line amount to approximately 16.0 million.
The securities held as available for sale recognized in the statement of financial position include – as in the previous year – corporate and government bonds as well as commercial papers with a term of up to three months. The securities have been measured at market prices. Any fluctuations in the market price are recognized in accumulated other comprehensive income and therefore do not affect profit and loss.
Financial expense includes 163 thousand in interest cost from the compounding of noncurrent financial liabilities, which resulted from the acquisitions of Tamarack / USA (100% acquisition) and Suss MicroOptics /Switzerland (15% acquisition) in the 2012 fiscal year.
Other issues influencing assets, liabilities, shareholders'equity,the result for the period,or cash flows and unusual in terms of their nature, magnitude, or frequency did not arise during the interim reporting period.
SUSS MicroTec AG has accordingly implemented the required disclosures in the revised IAS 1 (see the discussion under Point 3.3). No further changes have been made; the remaining presentation of the consolidated financial statements as of June 30, 2013, is analogous to the presentation as of December 31, 2012.
To the extentthat estimatesweremade in the interimreports,themethodologyunderlying the estimates remained fundamentally the same during the fiscal year and in comparison to the previous fiscal year.
In a departure from the approach used at the end of the fiscal year, income tax expense in each interim reporting period is recorded on the basis of the best estimate of the weighted average annual income tax rate which is expected for the entire fiscal year.
SUSS MicroTecAGcurrently assumes thatthe annual income tax ratewill deviate from the expected tax rate of approximately 28%.The primary reason for this is that the losses accrued by foreign subsidiaries cannot be capitalized.
Otherwise there are no changes requiring disclosure which would have a material impact on the current interim reporting period.
During the reporting period, no issuances,repurchases, or repayments occurred involving either bonds or equity securities.
During the reporting period, no dividend was distributed nor was such a distribution proposed.
No material events occurred after the end of the interim reporting period.
There are no contingent receivables.There were no substantial changes in contingent liabilities since the previous reporting date of December 31, 2012.
Basic earnings per share are calculated by dividing the net profit or loss for the period (net of minority interests) by the average number of shares.
In order to calculate diluted earnings per share,the profit orloss for the period attributable to shareholders (net of minority interests) and the weighted average of outstanding shares are adjusted for the impact of all potential dilutive shares.
The following table shows the calculation of the basic and diluted earnings per share:
| in 1 thousand | 6M/ 2013 | 6M/ 2012 |
|---|---|---|
| Profit or loss from continuing operations | -11,647 | 355 |
| Less minority interests | 0 | -30 |
| Profit or loss from continuing operations attributable to shareholders of SUSS MicroTec AG | -11,647 | 325 |
| Weighted average number of outstanding shares | 19,115,538 | 19,101,749 |
| Effect of the (potential) exercise of stock options (number of options) | 0 | 0 |
| Adjusted weighted average number of outstanding shares | 19,115,538 | 19,101,749 |
| Earnings per share in 1 from continuing operations – basic – | -0.61 | 0.02 |
| Earnings per share in 1 from continuing operations – diluted – | -0.61 | 0.02 |
"To the best of our knowledge, and in accordance with the applicable reporting principles,the consolidated interim financial statements give a true and fair view of the assets, liabilities, financial position, and profit or loss of the Group, and the Group Interim Management Report includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal opportunities and risks associated with the expected development of the Group over the remainder of the fiscal year."
Garching,Germany, August 2013
Frank Averdung Michael Knopp Chief Executive Officer Chief Financial Officer
of SUSS MicroTec Group
Holding company Production
Sales Other / Non-operating
(1) in liquidation
| Interim Report 2013 | August 8 |
|---|---|
| Commerzbank TMT Conference, Frankfurt | August 28 |
| Deutsche Bank Technology Conference, Las Vegas | September 10–12 |
| Bankhaus Lampe German Technology Seminar, Zurich | September 13 |
| UBS Best of Germany Conference, New York | September 16–18 |
| UniCredit /Kepler Investment Conference, Munich | September 24–26 |
| Baader Investment Conference, Munich | September 24–26 |
| Nine-month Report 2013 | November 7 |
| German Equity Forum, Frankfurt/Main | November 11–13 |
| Morgan Stanley TMT Conference, Barcelona | November 21 –22 |
| Published by | SUSS MicroTec AG |
|---|---|
| Edited by | Finance, Julia Natterer |
| Investor Relations, Franka Schielke | |
| Concept and design | Whitepark GmbH & Co., Hamburg |
| Photography | Michael Lange, SUSS MicroTec AG |
SUSS MicroTec AG Schleißheimer Straße 90 85748 Garching,Deutschland Phone: +49 (0)89-32007-0 E-mail: [email protected]
Investor Relations Phone: +49 (0)89-32007-161 E-mail: [email protected]
Forward-looking statements: These reports contain forward-looking statements. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements.These statements are based oncurrent plans, estimates, and projections,and should be understood as such. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update any of them in light of new information or future events. Forward-looking statements involve inherent risks and uncertainties.We caution readers that a number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement.
SÜSS MicroTec AG Schleißheimer Straße 90 85748 Garching, Deutschland Phone: +49 (0)89-32007-0 E-mail: [email protected]
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