BE Semiconductor Industries N.V. ("the Company" or "Besi") (Euronext: BESI), a leading manufacturer of assembly equipment for the semiconductor industry, today announced its financial results for the second quarter ended June 30, 2008.
Key Highlights for Second Quarter 2008
• Revenue up 25.3% vs. Q1-2008 due primarily to strong customer demand for flip chip and multi chip die bonding equipment and delivery of packaging equipment orders from Q1
• Orders up 13.7% from Q1-2008 mainly due to significant die bonding and thin film solar plating orders
• Gross margin increased to 35.0% from 33.6% in Q1-2008 principally due to higher die bonding and singulation system margins
• Ongoing cost control efforts lead to decline in operating expenses to € 13.8 million vs. € 14.2 million in Q1-2008 (-3%) and € 16.9 million in Q2-2007 (-18%)
• Higher shipments and gross margins and lower operating expenses increased operating income to € 2.5 million vs. operating loss of € 1.8 million in Q1-2008, in spite of 4% decline (approximately € 0.5 million) in average USD/EUR rate in Q2 vs. Q1
• Execution of Dragon I program and production transfer to Asia offsets declining USD/EUR rate
• Return to profitability in Q2 with net profit of € 2.2 million up from net loss of € 2.1 million in Q1-2008 and € 4.7 million in Q2-2007
• Slowing global economy, customer caution and difficult assembly market conditions expected to limit third quarter performance

Six Month Results 2008/2007
For the first half year 2008, Besi’s revenue was € 83.6 million as compared to € 86.7 million in the first half of 2007. Despite lower revenue in the first half of 2008, operating income for the first half of 2008 was € 0.7 million as compared to an operating loss of € 4.0 million in the first half of 2007, primarily due to cost reductions realized from the June 2007 Dragon I restructuring plan and the absence of restructuring charges in the first half of 2008 in comparison to the first half of 2007 (€ 3.3 million). For the first half year 2008, Besi had a net profit of € 0.1 million, or nil per share as compared to a net loss of € 3.2 million, or € 0.10 per share in the first half of 2007.

Comments
Richard W. Blickman, President and Chief Executive Officer of the Company, commented: “We are very pleased with our progress this quarter in the face of a very difficult environment for the global economy, the semiconductor equipment industry and for Euro based suppliers. With the improvement in our profit this quarter as compared to Q1, Besi returned to a break even level of profitability for the first half of 2008 despite a 4% year over year revenue decline and decrease in the value of the USD.
Our revenue, bookings and income were all above our quarterly guidance. Revenue growth this quarter benefitted from strong customer demand for our flip chip and multi chip die bonding equipment reflecting our leading market positions in both product offerings. Bookings benefitted from strong demand for die bonding and molding equipment including a € 3.4 million order for 12 Evo multi chip die bonders as well as a € 4.2 million order for thin film plating systems for solar cell production received by our Meco subsidiary. In addition, results were also positively influenced by the continued reduction in our quarterly operating expenses (down 3% as compared to the first quarter and 18% compared to the second quarter of 2007).
Further, we continue to benefit from our June 2007 Dragon I organizational restructuring and production transfer to Asia which achieved in excess of € 6 million in annual cost savings. Savings from Dragon I have enabled us to offset the 13% decline in the average value of the USD versus the Euro (approximately € 4 million pre tax) in the first half of 2008 versus the first half of 2007.
From a market perspective, the Company is still confronted with strong headwinds currently in the form of a slowing global economy, customer caution in adding assembly capacity in the face of an uncertain economic environment and intense price competition facing Euro based equipment suppliers. Such factors are expected to limit Besi’s third quarter financial performance.”

Outlook
Based on its June 30, 2008 backlog and feedback from customers, Besi expects that its revenue and orders will decrease by 15-20% in the third quarter of 2008 as compared to the € 46.5 million and € 44.8 million, respectively, achieved in the second quarter of 2008. Besi expects that its gross margins will range between 35-37% (assuming no further deterioration in the value of the US dollar versus the Euro) as compared to 35% realized in the second quarter of 2008. In addition, operating expenses are expected to be approximately equal to the € 13.8 million reported in the second quarter of 2008. Capital expenditures are forecast to be approximately € 2.3 million as compared to € 2.6 million in the second quarter of 2008.
Investor Conference Call Besi will host a conference call and audio webcast (log on via www.besi.com) to discuss its operating results for the second quarter ended June 30, 2008 on Thursday, July 31, 2008 at 4:00 p.m. Continental European Time (3:00 p.m. London Time, 10:00 a.m. New York Time).