Micronic Group, Third Quarter Report, July 1 - September 30, 2001.

Micronic Shows Strong Order Intake In Weak Market Micronic Group, Third Quarter Report, July 1 - September 30, 2001. Täby, Sweden, October 23, 2001 - Micronic Laser Systems AB (Stockholm Exchange's "Attract 40 list": MICR) is at the forefront in semiconductor and display laser pattern generators for the production of photomasks to the worldwide electronics industry. Micronic today announces its third quarter results. (Figures in brackets relate to the period July 1 - September 30, 2000, if not otherwise stated.) · Net sales during the quarter amounted to MSEK 102 (162) · Result after financial items was a loss of MSEK -49 (profit 39) · Order intake amounted to MSEK 213 (139) · Closing order book at end of quarter of MSEK 458 (365) · The total number of employees was 325 (260) at the end of the quarter "Against a backdrop of continued weakness and pessimisms in the semiconductor market segment, we are happy to report strong booking in the display and multi purpose segments", said Sven Löfquist, president and CEO of Micronic Laser Systems. Key events in third quarter · Four scientists at Micronic have received the SEMI award (Semiconductor Equipment and Materials International) for their breakthrough contributions to laser pattern generation technology. Micronic is the first European company to receive the North American SEMI award for advancement of semiconductor manufacturing technology. The price was shared with scientists from Etec (an Applied Materials company). · Micronic has received one order for a MP80-system for electronic packaging application. Furthermore one customer has ordered two LRS11000 TFT-systems for manufacturing of advanced TFT-LCD photomasks. · · An extraordinary General Meeting of shareholders was held on July 13. The meeting decided to issue convertible subordinate debentures of MSEK 320 to ASML Holding N.V. The debenture is interest free and can be converted to one million shares in Micronic, at a conversion price of SEK 320 per share during a period up to July 31, 2004. The debenture relates to a strategic alliance between ASML and Micronic. If fully converted into shares ASML will hold a shareholder capital position and voting power of 4,9%. ASML has subscribed for the convertible subordinate debenture and the payment has been made to Micronic. Markets and Micronic products Semiconductors Semiconductor manufacturers continue to focus on high-end technology. At the same time the industry accelerate cost reduction in manufacturing by decommissioning of older production lines. The Sigma7100 and Omega6600 systems fit well into the customers needs. By optimizing the use of laser tools they will increase the mask-shop efficiency while controlling capital expenditure. The Micronic products are ideally positioned to take full advantage of both technology purchases as they occur today and capacity purchases, as they will occur in the market upturn. Displays Display manufacturers are working to improve productivity and introduce new technology, which leads to requirements for more advanced photomasks. To meet this demand Micronic´s customers are investing in new advanced laser pattern generators. Multi Purpose The market for electronic packaging is evolving rapidly with new advanced wafer scale packaging technology. This leads to an increasing market for Micronic´s MP80 pattern generator, with potential high volumes. However, the currently weak semiconductor market makes the customers cautious with investments. ASML activities During the quarter Micronic, together with ASML, has conducted a joint market research to understand the interest in and needs for direct write applications. The study has shown a long term potential for maskless lithography based on the unique SLM-technology (spatial light modulator) developed by Micronic. Key figures Order intake, invoiced sales and order backlog Order intake in the third quarter amount to MSEK 213 (139), consisting of three new systems and service. From one customer Micronic has received a record order for two LRS11000 TFT-systems for advanced TFT- LCD photomasks, of which one system will be delivered during the fourth quarter while the second system will be delivered within the first half year in 2002. In the multi purpose segment Micronic has received an order for a MP80 system. Closing order book amounted to MSEK 458 (365). Net sales for the period amounted to MSEK 102 (162), which included one Omega system and service. Operating costs Operating costs for the quarter, including change of work in progress, amounted to MSEK 145 (125). These costs include cost of sales MSEK 66, R&D MSEK 54 and G&A MSEK 25. Cost of sales, MSEK 66, include material cost, labour cost, production overhead and allocated administration costs. The R&D cost amounted to MSEK 54, which is at a slightly lower level than previous quarters this year. The activities are mainly concentrated on the development of the Sigma system. Property The expansion of Micronic´s facilities in Täby is completed. The new production facility has been in operation since June. Micronic is evaluating the final financing of the facilities. Profitability The quarterly result after financial items was a loss of MSEK 49 (profit 39). Earnings per share The total number of shares in issue is 19,100,583. After full dilution, including warrants net after withdrawals, the company will have 20,793,733 shares in issue. Each share has a par value of SEK 1. Earnings per share, after tax and full dilution, were a loss of SEK 1,62 (profit of 1,42). Personnel The total number of employees decreased during the quarter from 330 to 325. The number of employees in Sweden was reduced by 9 while outside Sweden the number of employees rose by 4 to 53 during the quarter. The increase is aimed at enhancing the customer support and service as our installed base continues to expand. Capital expenditure The net capital expenditure during the period, MSEK 32 (12), relates to investments in the parent company's property, MSEK 15, and intangible assets, MSEK 17. Cash-flow, liquid funds and financial position The Group has a good financial position at the end of the quarter. The closing balance of liquid funds at the end of the third quarter was MSEK 422 (415), an increase by MSEK 103 since the beginning of the year (increase by 332), excluding an unutilized overdraft facility. The closing equity ratio was 51 (71) %. Operations have consumed MSEK -94 (-98). Funds tied up in working capital (liquid funds excluded) have increased by MSEK 30 (-120). Capital expenditure in fixed assets amounts to MSEK 124 (33). External funds supplied amount to MSEK 320 (462), which is payment for the convertible subordinate debenture from ASML. Future outlook The semiconductor industry´s capital expenditure recovery has become even more unpredictable as the political and economical uncertainties have increased. Signs of recovery in the photomask market has not occurred. Micronic and its customers are significantly affected during these sharp downturns due to the derivative effects in the industry´s food chain. The visibility for 2002 is for the moment low as the US market is revising their CAPEX budgets on a quarterly basis and the budget process for the Japanese fiscal year 2002, beginning in April, has just started. In the semiconductor market the demand for photomasks for 250 nm technology and above is very limited while demand at and below 180 nm remains, although at a low level. In the display segment the utilization is still high which is a positive indicator. We foresee that major companies will make careful and limited technology purchases for 130 nm node in advance of an eventual capacity ramp up. With the high degree of uncertainties in the market, risks for push outs of shipment planned in the fourth quarter cannot be excluded. At the same time, the high quality photomasks generated by Micronic´s products has opened up opportunities for additional orders that can be converted into shipments during the fourth quarter. Based on the above, the assessment made by the board is that net sales will be in line with last year, and that Micronic will report a positive net margin for the full year. Miscellaneous Accounting rules and calculation methods are the same as in the Annual Report 2000. The calculation method for year 2000 has been updated according to note in reported Financial statements. This interim report has not been subject to examination by the company's auditors. Future reports October 1 - December 31, 2001 February 12, 2002 Täby, October 23, 2001 Micronic Laser Systems AB (publ.) Sven Löfquist, President and CEO. For further information, please contact: Sven Löfquist, CEO Tel: +46-8-638 52 00 e-mail: sven.lofquist@micronic.se ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2001/10/23/20011023BIT00400/bit0002.doc The full report http://www.waymaker.net/bitonline/2001/10/23/20011023BIT00400/bit0002.pdf The full report