CEO statement and outlook
"On March 30, ASML provided an update to the market on expected Q1 2020 results, primarily related to the COVID-19 impact. We announced in our press release that we expected revenue in the first quarter to be between €2.4 billion and €2.5 billion, with a gross margin between 45% and 46%, and that impacted revenue was expected to shift to subsequent quarters in 2020.
"Our first-quarter sales came in at €2.44 billion, which is within the range that we announced in our update. The gross margin came in at 45.1%, at the lower end of our updated guidance due to delayed revenue from field upgrades. We shipped four EUV systems in the quarter but we were only able to recognize revenue for two systems, for reasons mentioned in our press release of March 30, 2020. Our Q1 net bookings were strong and came in at €3.1 billion, including €1.5 billion of EUV systems (11), which shows continued strong demand for EUV.
"The demand outlook is currently unchanged and we have not encountered any push-outs or cancellations this year. Despite the challenging circumstances, to date we have been able to continue ASML’s operations. Our order intake is strong. Many of the investments made by our customers are strategic and support their long-term plans. However, in light of the current risks and uncertainties related to COVID-19, we decided to refrain from giving guidance for Q2 and for the full year 2020. There is significant uncertainty about how the current COVID-19 crisis will impact the global GDP development, end markets, our manufacturing capability and supply chain.
"Our primary goal is to ensure, as best as we can, that our colleagues and their families stay safe. Our second goal is to ensure that we continue to serve our customers and to secure the delivery of our product roadmap, including the continuity of our supply. It is very encouraging to see the creativity, resilience and dedication at ASML and the industry overall," said ASML President and Chief Executive Officer Peter Wennink.
Final dividend proposal and share buyback program update
ASML intends to declare a total dividend for 2019 of €2.40 per ordinary share, consisting of an interim dividend of €1.05 per ordinary share, paid in November 2019, and a final dividend payment of €1.35 per ordinary share, as will be proposed to shareholders at the Annual General Meeting (AGM) scheduled for April 22, 2020.
As part of its financial policy to return excess cash to its shareholders through growing annualized dividends and regularly timed share buybacks, in January 2020 ASML announced a new three-year share buyback program, to be executed within the 2020–2022 time frame. As part of this program ASML intends to purchase shares up to €6 billion, which includes a total of up to 0.4 million shares to cover employee share plans. ASML intends to cancel the remainder of the shares repurchased.
On March 30, 2020 ASML announced that, due to the uncertainties arising from COVID-19, ASML decided not to execute any share buybacks in Q2 2020. This decision follows the pause in the execution of the program in the first quarter of the year, after having already performed share buybacks under this program for an amount of approximately €507 million. The three-year share buyback program remains in place.
Quarterly video interview, investor and media conference call
With this press release, ASML has published a video interview in which CFO Roger Dassen discusses the Q1 2020 results and the impact of the COVID-19 outbreak on our business. This can be viewed on www.asml.com.
A conference call for investors and media will be hosted by CEO Peter Wennink and CFO Roger Dassen on April 15, 2020 at 15:00 Central European Time / 09:00 US Eastern Time. Details can be found on our
website.
