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15 March 2007


Aixtron’s 23% revenue growth in 2006 drives return to profitability

Deposition equipment maker Aixtron AG of Aachen, Germany has reported revenues of €171.7m for 2006, up 23% on 2005’s €139.4m. This was boosted by fourth-quarter revenue of €63.1m, up a massive 54% on Q3’s €40.9m.

The firm says the rise is due to a more positive market environment for semiconductor equipment, the expanded range (following the integration of atomic layer deposition and chemical vapor deposition equipment maker Genus Inc, acquired in March 2005), and improving demand for newly launched MOCVD products .

Of total revenues, by region, a dominant 79% came from Asia (up from 74% in 2005), 13% from Europe (down from 16%), and just 8% from the USA (down from 10%). By applications, 44% came from LEDs (especially in Asia), 32% from silicon, 5% for consumer/optoelecronics, and 19% from displays and other applications.

President and CEO Paul Hyland recalls that Aixtron’s aim at the beginning of 2006 was to reduce its dependency on revenues from compound semiconductor applications. From 82% of revenues in 2004 and 58% in 2005, this was 56% in 2006 (based on 19% growth in revenue to €97m for compounds), as silicon-related revenues have grown from just 1% of total revenues in 2004 to 23% in 2005 (boosted by the Genus acquisition) and now 27% in 2006 (to €46.1m).

The increased revenues, plus the review of costs and operating practices, yielded net income of €5.9m, compared to its target of break-even and a net loss of €53.5m in 2005.

Equipment order intake was €178m (up 57% on €113.6m in 2005). For compound semiconductors it was €136.8m (up 79%), reflecting a significant mid-year rise in demand from LED end-application markets, as well as current confidence in the sector and customers’ positive response to new products launched at the end of 2005 (comprising a third of all orders). Equipment orders for silicon were €41.2m (up 11%), based on robust demand for CVD equipment for memory applications. Although demand for silicon systems has historically been more volatile than demand for compounds, demand for traditional CVD technology has been relatively stable for five quarters now, says Hyland.

While order intake for compounds will be more muted in early 2007, says Hyland, Aixtron believes that 2007 revenues will remain at a healthy level both for the compound and silicon semiconductor applications. With equipment order backlog at the end of 2006 at €85.1m (up 75% on €48.6m at the end of 2005), for fiscal 2007 Hyland expects revenue of €190-200m and a profit of €15-16m.