Dutch semiconductor equipment maker ASML Holding NV (ASML) Wednesday reported sharply lower profit in its first quarter as revenues were hurt by a plunge in system sales, despite growth in selling prices. The company also backed its fiscal 2013 forecast of flat sales, and announced up to 1 billion euros of share buyback until the end of 2014.
In addition, the company appointed Chief Financial Officer Peter Wennink as the new Chief Executive Officer as of July 1, succeeding Eric Meurice, whose contract ends next year.
Commenting on the first-quarter results, Meurice said, "We achieved first quarter sales ahead of and gross margin in line with our guidance, and reiterate our expectation for a sales acceleration during the year, with a second quarter markedly stronger than the first quarter and a large second half, leading to expected 2013 full year net sales at a similar level to that of 2012."
In its just concluded first quarter, Veldhoven, the Netherlands-based ASML's net income, on IFRS basis, declined to 155.7 million euros from last year's 317.4 million euros. On U.S. GAAP basis, net income was 96.2 million euros, sharply lower than 282 million euros a year ago.
Gross margin fell to 38.2 percent from 41.8 percent a year ago. Income from operations margin was 12.1 percent, lower than last year's 25.8 percent.
Total net sales fell to 892.1 million euros from last year's 1.25 billion euros mainly due to a 35.5 percent plunge in net system sales.
In the quarter, sales of systems totaled 29 units, lower than 52 units a year ago. Average selling price of system sales, however, increased to 23.3 million euros from last year's 20.2 million euros.
Looking ahead to the second quarter, ASML said it expects net sales of about 1.1 billion euros, and a gross margin of between 41 and 42 percent. The company had earlier expected a slow start in the first quarter, but a recovery was expected in the second quarter and a relatively large second half.
Regarding its leadership succession, the company noted that Wennink will act as interim Chief Financial Officer until a successor has been appointed.
Meurice, who took office as CEO and President in 2004 and is currently on his third term, will be Chairman and act as adviser to the new leadership and the Supervisory Board until the end of his contract on March 31, 2014.
ASML also said that Martin van den Brink will be President and Chief Technology Officer, and Frits van Hout and Frederic Schneider-Maunoury will continue as Executive Vice Presidents.
On Nasdaq, ASML shares closed Tuesday's trading at $67.78, up $1.31 or 1.97 percent.
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