(million EUR) 2007 Full Year 2006 Full Year 2005 Full Year 2006 2007 Revenues 214.8 171.7 139.4 25% Gross profi t 85.0 63.4 34.7 34%
Gross margin, % revenues 40% 37% 25% 3 p.p
EBIT 20.6 5.7 -52.7 261%
EBIT, % revenues 10% 3% -38% 7 p.p
Net result 17.3 5.9 -53.5 193%
Net result, % revenues 8% 3% -38% 5 p.p
Net result per share – basic (EUR) 0.20 0.07 -0.65 186%
Net result per share – diluted (EUR) 0.19 0.07 -0.65 171%
Free cash fl ow 22.3 15.6 -15.2 43%
Equipment Order Intake 247.7 178.0 113.6 39%
68 percent, of AIXTRON’s total revenues in 2007 (2006: 56 percent; 2005: 58 percent) were generated from sales of compound semiconductor equipment. For silicon semi- conductor deposition equipment, customer demand for mainly NAND-Flash and DRAM- production systems decreased slightly, considering the volatility experienced by the market, by EUR 4.4m or 9 percent to EUR 41.7m. Revenues related to the sales of silicon semicon- ductor equipment accounted for 19 percent of total revenues in 2007, a relative decrease from 27 percent in 2006 (2005: 23 percent) resulting mainly from the disproportionate compound semiconductor equipment revenue growth in 2007.
Equipment sales generated 87 percent of revenues in 2007, compared to 83 percent in 2006 (2005: 81 percent). The remaining revenues were generated by sales of spare parts and service. Revenues by Technology 2007 Full Year 2006 Full Year 2005 Full Year 2006 2007
mil. EUR % mil. EUR % mil. EUR % mil. EUR %
Revenues 214.8 100 171.7 100 139.4 100 43.1 25
of which from sale of silicon semiconductor equipment
41.7 19 46.1 27 32.7 23 -4.4 -9
of which from sale of compound semi- conductor equipment and other equipment (OVPD®, SiC)
145.2 68 97.0 56 80.7 58 48.2 50
of which other revenues (service, spare parts, etc.)
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Consolidated fi nancial statements Notes to the consolidated fi nancial statemant
81 percent of the Company’s revenues in 2007 were generated in Asia. Asia was also the company’s biggest market in 2006 (79 percent) and 2005 (74 percent):
Revenues by Region
5.1.2. Cost Structure and other income
2007 Full Year 2006 Full Year 2005 Full Year 2006 2007
mil. EUR % mil. EUR % mil. EUR % mil. EUR %
Asia 174.1 81 135.2 79 103.0 74 38.9 29 Europe 18.8 9 22.3 13 22.1 16 -3.5 -16 USA 21.9 10 14.2 8 14.3 10 7.7 54 Total 214.8 100 171.7 100 139.4 100 43.1 25 In percent of Revenues 2007 Full Year 2006 Full Year 2005 Full Year 2006 2007
mil. EUR % mil. EUR % mil. EUR % mil. EUR %
Cost of Sales 129.8 60 108.2 63 104.7 75 21.6 20
Operating Costs 64.4 30 57.7 34 87.4 63 6.7 12
Selling expenses 27.2 13 23.4 14 27.8 20 3.8 16
General and adminis- tration expenses 16.0 7 17.3 10 18.0 13 -1.2 -7 Research and development costs 26.5 12 23.9 14 30.5 22 2.6 11 Other operating income 6.6 3 8.5 4 5.6 3 -1.9 -22 Other operating expenses 1.3 1 1.6 1 2.9 2 -0.3 -19 Goodwill impairment 0.0 0 0.0 0 13.8 10 0.0 n.m.
Cost of Sales
Driven by higher revenues, cost of sales increased by 20 percent from EUR 108.2m in 2006 to EUR 129.8m in 2007 (2005: EUR 104.7m). However, cost of sales relative to revenue decreased by 3 percentage points in 2007 as compared to 2006, to 60 percent, after decreasing in 2006 12 percentage points (2005: 75 percent).
The relatively small increase in the absolute level of cost of sales, relative to a 25 percent year on year increase in revenue in 2007, was due to a different product-mix with a higher revenue element from our latest generation platform based deposition equipment that partially offset the negative effects of the US-Dollar / Euro exchange rate difference. Impairment charges resulting from the 2005 Genus, Inc. acquisition, and impairment charges on inventories, intangible assets and expenses for the creation of restructuring accruals, amounting to EUR 7.5m, were incurred in 2005. There were no material impair- ment charges in 2006 and 2007.
Operating Costs and other Operating Income
Operating costs increased by 12 percent, disproportionally lower than the revenue growth of 25 percent to EUR 64.4m in 2007 (2006: EUR 66.2m; 2005: EUR 93.0m), due to higher R&D and Selling expenses and reduced Grant Income, only partially offset by lower admin- istrative expenses. No goodwill impairment expenses were incurred in 2007 or 2006 (2005: EUR 13.8m).
Selling, general and administrative (SG&A) expenses
Selling, general and administrative (SG&A) total expenses totaled EUR 43.2m in 2007, a 6 percent increase compared to EUR 40.7m in 2006 (2005: EUR 45.8m).
Selling expenses in 2007 amounted to EUR 27.2m, an increase of 16 percent compared to EUR 23.4m in 2006 (2005: EUR 27.8m). This increase was due to higher variable selling expenses such as; Sales Commissions and higher Warranty expenses, both driven by high- er revenue levels. Selling costs relative to revenues decreased from 14 percent in 2006 to 13 percent in 2007 (2005: 20 percent)
Administrative expenses in 2007 totaled EUR 16.2m (2006: EUR 17.3m; 2005: EUR 18.0m). Administrative expenses decreased by 6 percent in 2007 in comparison to 2006 mainly due to reduced legal consultancy and auditing fees. Administrative costs relative to revenues decreased from 10 percent in 2006 to 8 percent in 2007 (2005: 13 percent)
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Consolidated fi nancial statements Notes to the consolidated fi nancial statemant
Research and Development costs
R&D costs totaled EUR 26.5m in 2007, an increase of EUR 2.6m, or 11 percent, compared to EUR 23.9m in 2006 (2005: EUR 30.5m). The increase in R&D expense in 2007 compared to 2006 was largely due to increased development activities and the consequent 15 per- cent increase in headcount of temporary and permanent staff, increased material costs and depreciation charges year on year. However, the ratio of R&D costs to revenues de- creased in 2007 to 12 percent, compared to 14 percent in 2006 (2005: 22 percent).
Personnel Costs
With the number of global employees at 609 at year end 2007, an increased headcount by 43 employees compared to year end 2006 (566 employees), personnel expenses amounted to EUR 45.0m in 2007, an increase of 7 percentage points in comparison to EUR 42.0m in 2006 (2005: EUR 41.1m). The increase in 2007, as compared to 2006, primarily refl ected additional headcount in R&D and Engineering, required to support a higher volume system output and an increased number of R&D projects and additionally, a higher actual performance related compensation element.