Sees Front-end Sales Improvement
Takes Impairment Charge for NuTool Operation Restructuring and
Write-off for TCP Group Realignment
Press release (PDF):
http://hugin.info/132090/R/1031653/165713.pdf
BILTHOVEN, The Netherlands - January 27, 2006 --- ASM International N.V. (Nasdaq: ASMI and Euronext Amsterdam: ASM) today updated the guidance for its Fourth Quarter 2005 Operating Results that was presented in ASMI's third quarter press release, dated October 27, 2005.
ASMI confirms that fourth quarter sales from its Front-end, or wafer processing, segment increased significantly from the third quarter level and reached the highest level for any three-month period in 2005. In line with the Company's prior guidance, total year Front-end sales are approximately at the same level as reported for 2004.
ASMI's first priority is to bring Front-end operations to profitability. The company reiterates that its three established Front-end businesses - epitaxy, vertical furnaces, and PECVD - which together account for roughly 90% of Front-end sales, all have positive earnings from operations on an annual basis. As part of its primary focus on the profitability of the Front-end operations, the Company has decided to make immediate adjustments in its NuTool and Transistor Capacitor Product Groups.
Regarding its NuTool copper plating, planarization and Electrochemical Mechanical Deposition (ECMD(TM)) processes operation, ASMI announces that it will significantly reduce ASM NuTool to a small operation, focusing on process and intellectual property development with the intention of licensing these technologies in the future. In connection with the restructuring of ASM NuTool, ASMI will record an impairment charge for goodwill, a write-off of certain assets, the recognition of contractual obligations and settlement charges with former NuTool shareholders, in the amount of approximately € 42 million. Of this charge, € 37 million will be recorded in the fourth quarter of 2005 and € 5 million in the first quarter of 2006. The charge will be primarily non-cash: € 36 million. Of the remainder, € 3 million will be in ASMI common shares and € 3 million in cash.
In order to more closely align ASMI operations with current market demands, ASMI will also consolidate the wafer handling platforms it is using in its Transistor Capacitor Product Group, which includes ASMI's atomic layer deposition processes ALD and its companion PEALD(TM). In the fourth quarter of 2005, ASMI will record a charge of approximately € 7 million in write off of certain assets and recognition of outstanding purchase commitments, relating to this consolidation. Of this charge, € 6 million will be non-cash.
ASMI is developing atomic layer deposition, which is a major technology at a crucial stage in its product life cycle, beginning to migrate from R&D to pilot lines and high volume manufacturing environments in the semiconductor industry, while finding new applications in expanded fields of nanotechnology, into the fourth core product category in ASMI's technology portfolio.
The Company will provide further details on the restructuring of ASM NuTool and other matters discussed in this release when ASMI reports 2005 consolidated operating results on Tuesday, February 21, 2006.

Note: The amounts mentioned above are unaudited and may be subject to change.