ASML Q1 Profit Surges 62% As Margins, Sales Grow

(RTTNews) - Dutch semiconductor equipment maker ASML Holding NV (ASML) reported Wednesday a profit for the first quarter that surged 62 percent from last year, reflecting improved margins and double-digit sales growth, which came in line with guidance. However, the company forecast slightly lower sales and gross margins for the second quarter.

"Our first-quarter net sales came in as guided at 1.65 billion euros, driven by continued strong DRAM memory segment sales in combination with higher foundry segment sales. Our gross margin rose to 47.2 percent, a reflection of product mix as well as better utilization of our production facilities, which was partly offset by unfavorable foreign exchange effects," ASML President and CEO Peter Wennink said in a statement.

The company reported net income of 402.7 million euros or 0.93 euro per share for the first quarter, sharply higher than 249.1 million euros or 0.56 euro per share in the prior-year quarter. In accordance with IFRS, quarterly net income climbed to 470.0 million euros from 283.3 million euros last year.

Total net sales for the quarter increased 17.9 percent to 1.65 billion euros from 1.40 billion euros in the same quarter last year, with net system sales improving to 1.25 billion euros from last year's 1.03 billion euros.

The company sold 47 litho systems in the quarter, up from 40 in the previous year. However, net booking value declined to 1.03 billion euros from 1.07 billion euros last year.

Operating margin for the quarter expanded 860 basis points to 27.6 percent from last year as gross margin improved 360 basis points to 47.2 percent and lower expenses.

Looking ahead to the second quarter, ASML projects net sales of around 1.6 billion euros and a gross margin of around 45 percent.

"Our Q2 guidance of around 1.6 billion euros of net sales confirms our earlier expectation that the first half of 2015 will be stronger than the second half of 2014. In memory, our Q1 sales and order book suggest that sales to the DRAM segment will stay healthy in 2015, although more weighted to the first half of the year. In logic, we expect stable sales throughout 2015," Wennink added.

ASML added it models an annual revenue opportunity of 10 billion euros by 2020 and a potential tripling of earnings per share by the end of this decade, thereby creating significant value for all stakeholders.

The company also expects to continue to return excess cash to its shareholders through dividends that are stable or growing and regularly timed share buybacks in line with its policy. ASML has proposed to again increase dividend by 15 percent to 0.70 euro per ordinary share, which will be discussed at the AGM on April 22.

ASML closed Tuesday's regular trading session at $99.97, down $0.88 on a volume of 1.09 million shares. In the past 52-week period, the stock has been trading in a range of $79.66 to $111.40.

The stock fell 1.17 percent in Amsterdam on Tuesday to close at 94.05 euros.