Asml Holding Nv · EURONEXT:ASML
Asml Holding Nv — Shareholder Meeting (April 2022)
60 slides from Asml Holding Nv's shareholder meeting presentation, Apr 29, 2022
Slide 1: Annual General Meeting
Annual General Meeting Veldhoven, the Netherlands April 29, 2022 Public
Slide 2: Forward looking statements
Forward looking statements This document and related presentation contains statements that are forward-looking, including statements with respect to expected trends, including trends in end markets and technology industry and business environment trends, rising business costs, outlook and expected f
Slide 3: Agenda
Agenda Of the Annual General Meeting of ASML Holding N.V. (the “Company”), to be held on Friday 29 April 2022 at 14.00 hrs. CET 1. Opening 2. Overview of the Company’s business, financial situation and sustainability (non-voting) April 29, 2022 Page 3 Public
Slide 4: Financials
Financials Roger Dassen, Executive Vice President and CFO April 29, 2022 Public
Slide 5: 2021 Highlights
2021 Highlights Full Year 2021 Net sales €18.6 billion ASML delivered a sales growth of 33%, reflecting the continued strong Net system sales €13.7 billion global demand for a digital infrastructure Installed Base €5 billion Management1 Gross Margin 52.7% EUV lithography Net income €5.9 billion • EU
Slide 6: Total net sales € million by End-use
Total net sales € million by End-use Installed Base Management1 Logic Memory As of January 1, 2018, ASML has adopted the new Revenue Recognition Standard (ASC 606) and Lease Standard (ASC 842). The comparative 2017 numbers presented above have not been adjusted to reflect these changes in accounting
Slide 7: Net system sales breakdown (Yearly)
Net system sales breakdown (Yearly) 1 2021 total system sales €13,653 million 2020 total system sales €10,317 million 1 2021: Excluding EMEA region which represents negative 1% as we bought back two unused systems previously sold to a customer, which we counted for as a revenue reversal. January Apr
Slide 8: Consolidated statements of operations € million
Consolidated statements of operations € million Year on Year 2017 2018 2019 2020 2021 Net sales 8,963 10,944 11,820 13,979 18,611 Gross profit 4,020 5,029 5,280 6,798 9,809 Gross margin % 44.9 46.0 44.7 48.6 52.7 Other income 1 96 — — — 214 R&D costs (1,260) (1,576) (1,968) (2,201) (2,547) SG&A cost
Slide 9: Consolidated statements of cash flows € million
Consolidated statements of cash flows € million Year on Year 1 Free cash flow, which is a non-GAAP measure, is defined as net cash provided by (used in) operating activities minus purchases of Property, plant and equipment and intangible assets), see US GAAP Consolidated Financial Statements. Januar
Slide 10: Consolidated balance sheets € million
Consolidated balance sheets € million Year on Year January April 19, 2022 29, 2022 Page 10 These numbers have been prepared in accordance with US GAAP. Numbers have been rounded for readers' conven ience. Public
Slide 11: Q1 2022 results and business view
Q1 2022 results and business view Q1 2022 Net sales €3.5 billion • We continue to see that the demand for our systems is higher than our current production capacity Net system sales €2.3 billion • We accommodate our customers through offering high-productivity Installed Base €1.2 billion upgrades an
Slide 12: Capital return to shareholders
Capital return to shareholders • Paid total dividends of €1.4 billion, consisting of FY2020 final dividend and FY2021 interim dividend, and purchased €8.6 billion of shares in 2021 • ASML intends to declare a total dividend in respect of 2021 of €5.50 per ordinary share. Recognizing the interim divi
Slide 13: Industry developments
Industry developments Peter Wennink, President and CEO April 29, 2022 Public
Slide 14: Our world continues to change
Our world continues to change April 29, 2022 Page 14 Public
Slide 15: The future will be all about distributed computing
The future will be all about distributed computing Public network Bringing the cloud closer to devices at the edge Privacy Performance Personalization Cloud Edge cloud On device Private networks Source: Ziad Asghar, Qualcomm, “Qualcomm AI leading the way with distributed intelligence, Embedded vison
Slide 16: The electronics industry just keeps going
The electronics industry just keeps going There are an estimated 40 billion connected devices in use today Roughly 5 for every person on the planet (7.8 billion people) In ten years, this number is expected to grow to 350 billion That’s 41 per person (assuming population growth to 8.5 billion) …gene
Slide 17: Countries push for technological sovereignty
Countries push for “technological sovereignty” Biden doubles down on a $50 billion plan to invest in chips Fortune (April 2021) EU aims to be independent chip power with 20% global share Nikkei Nikkei (March (March 2021) 2021) South Korea joins global chipmaking race with $450 billion spending plan
Slide 18: Semi end markets expected to grow 7% longer-term
Semi end markets expected to grow 7% longer-term Smartphone (B$) Consumer electronics (B$) Personal computing (B$) +6.7% +2.6% 210 +7.8% 155 116 161 98 100 119 110 132 155 160 69 120 115 144 102 109 113 108 106 48 64 66 67 70 83 78 93 86 76 87 43 43 48 36 35 15 16 17 18 19 20 21 22 23 24 25 26 27 28
Slide 19: Market opportunities support another 10 years of growth
Market opportunities support another 10 years of growth Drivers 2020 2025 2030 CAGR Systems: New and existing technology nodes Litho, in all segments will continue to be the Metrology & ~11%* main driver for our system revenue for Inspection litho and metrology & inspection ~10.3B€ Installed Growing
Slide 20: The chip industry is setting the bar higher and higher
The chip industry – including ASML – is setting the bar higher and higher April 29, 2022 Page 20 Public
Slide 21: ASML's roadmap supports the industry's growth and innovation
ASML’s roadmap supports the industry’s growth and relentless innovation EUV DUV High-NA Affordable scaling and yield Metrology, inspection, April 29, 2022 and patterning control Page 21 Public
Slide 22: DUV addresses numerous market segments
DUV addresses numerous market segments April 29, 2022 Page 22 Source: ASML Public
Slide 23: EUV adoption enabled by maturity of the platform
EUV adoption enabled by maturity of the platform in high volume manufacturing We intend to bring EUV availability to >95% and increase wafer/day output by >50% by 2025 April 29, 2022 Page 23 Public
Slide 24: Our next-gen High-NA systems are coming together in Veldhoven
Our next-gen High-NA systems are now coming together in Veldhoven We expect to have our first early-access system available in H1 2023 April 29, 2022 Page 24 Public
Slide 25: Planning for growth
Planning for growth Update in Q4 2022 • Unprecedented demand is exceeding our capacity. • We are actively working to significantly expand our capacity together with our supply chain partners. • We are investigating the feasibility of increasing our annual capacity to 90 EUV and 600 DUV units by 2025
Slide 26: ESG Sustainability strategy
ESG Sustainability strategy Based on 9 themes April 29, 2022 Page 26 Public
Slide 27: Growth in numbers of employees worldwide
Growth in numbers of employees worldwide (end year) US Europe Asia 2020: 5,710 2020: 14,715 2020: 6,050 2021: 6,180 2021: 18,4101 2021: 7,430 (incl. NL: 16,860) Total worldwide 2020: 28,0751 2021: 32,0201 122 nationalities 18% female 1 including Berliner Glas April 29, 2022 Slide 27 In FTE (Full Tim
Slide 28: Agenda
Agenda 2. Overview of the Company’s business, financial situation and sustainability (non-voting) April 29, 2022 Page 28 Public
Slide 29: Agenda
Agenda 3a. Advisory vote on the remuneration report for the Board of Management and the Supervisory Board for the financial year 2021 (Voting Item) April 29, 2022 Page 29 Public
Slide 30: Remuneration Report 2021 (1/3)
Remuneration Report 2021 (1/3) • The Remuneration Report 2021 for the BoM and SB complies with the revised EU Shareholder Rights Directive. • It contains a report on the implementation of the 2021 Remuneration Policy for the BoM (as adopted by the General Meeting on April 29, 2021, effective per Jan
Slide 31: Remuneration Report 2021 (2/3)
Remuneration Report 2021 (2/3) STI payout over 2021 has been 134.5% of target (80%), hence 107.6% of base salary April 29, 2022 Page 31 Public
Slide 32: Remuneration Report 2021 (3/3)
Remuneration Report 2021 (3/3) LTI payout over performance period 2019-2020-2021 has been 180.3% of target (90.2% of max) April 29, 2022 Page 32 Public
Slide 33: Agenda
Agenda 3a. Advisory vote on the remuneration report for the Board of Management and the Supervisory Board for the financial year 2021 (Voting Item) April 29, 2022 Page 33 Public
Slide 34: Agenda
Agenda 3b. Proposal to adopt the financial statements of the Company for the financial year 2021, as prepared in accordance with Dutch law (Voting item) April 29, 2022 Page 34 Public
Slide 35: Independent auditor's report
Independent auditor’s report IFRS Financial statements — Auditor’s report on consolidated and parent company financial statements Materiality of EUR 210 million — Our opinion: unqualified — 3.0% of 2021 income before — Financial statements give a true and fair income taxes view and are in accordance
Slide 36: Agenda
Agenda 3b. Proposal to adopt the financial statements of the Company for the financial year 2021, as prepared in accordance with Dutch law (Voting item) April 29, 2022 Page 36 Public
Slide 37: Agenda
Agenda 3c. Clarification of the Company’s reserves and dividend policy (non-voting) April 29, 2022 Page 37 Public
Slide 38: Agenda
Agenda 3d. Proposal to adopt a dividend in respect of the financial year 2021 (non-voting) April 29, 2022 Page 38 Public
Slide 39: Agenda
Agenda 4a. Proposal to discharge the members of the Board of Management from liability for their responsibilities in the financial year 2021 (Voting item) April 29, 2022 Page 39 Public
Slide 40: Agenda
Agenda 4b. Proposal to discharge the members of the Supervisory Board from liability for their responsibilities in the financial year 2021(Voting item) April 29, 2022 Page 40 Public
Slide 41: Agenda
Agenda 5. Proposal to approve the number of shares for the Board of Management (Voting item) April 29, 2022 Page 41 Public
Slide 42: Agenda
Agenda 6. Proposal to amend the Remuneration Policy for the Board of Management (Voting item) April 29, 2022 Page 42 Public
Slide 43: Why an update to the policy?
Why an update to the policy? • It’s been ~5 years since a major policy revision has taken place o Expectations of stakeholders have changed, including the desire for more transparency o ASML has grown significantly in size and scope over this period • The current policy has some limitations related
Slide 44: Further background
Further background • A formal review of the Board of Management Key objectives of the policy review: Remuneration Policy was originally scheduled for 2020, but was postponed due to the COVID-19 Update incentive measures to ensure a continued link with our long- term financial ambitions and key strat
Slide 45: 2022 Remuneration policy of the Board of Management
2022 Remuneration policy of the Board of Management Overview of the proposed new policy and changes • We have developed a policy which reflects the key performance drivers for ASML in the coming years, while being mindful to the external and corporate governance environment in the Netherlands and to
Slide 46: Main implications of the proposed changes
Main implications of the proposed changes • I. Reference Group • II. Short-Term Incentive (STI) • III. Long-Term Incentive (LTI) ❖ The new design enhances our focus on ❖ The new group is more aligned with ASML’s ❖ The new design enhances emphasis on our ASML’s long-term investment and return size an
Slide 47: Stakeholder feedback on the proposed BoM Remuneration Policy - Shareholders
Stakeholder feedback on the proposed BoM Remuneration Policy - Shareholders and Shareholder representatives • Outreach to major shareholders (Top 20), proxy advisors and shareholder interest organizations • Positive feedback about how the Supervisory Board proposes to address the sensitivities with
Slide 48: Stakeholder feedback on the proposed BoM Remuneration Policy – advice Works Council
Stakeholder feedback on the proposed BoM Remuneration Policy – advice Works Council The Works Council took the position that it does not fully support the proposed amendment of the Remuneration Policy. • The Works Council: • understands ASML’s challenges in ensuring that ASML can continue to attract
Slide 49: Stakeholder feedback – response Supervisory Board to Works Council advice
Stakeholder feedback on the proposed BoM Remuneration Policy – response Supervisory Board to advice Works Council • Employee wellbeing: no changes applied to proposed Remuneration Policy and target setting for 2022, as employee wellbeing is already explicitly taken into account in the LTI (employee
Slide 50: Agenda
Agenda 6. Proposal to amend the Remuneration Policy for the Board of Management (Voting item) April 29, 2022 Page 50 Public
Slide 51: Agenda
Agenda 7. Composition of the Board of Management (Discussion items) 7a. Notification of the intended reappointment of Mr. P.T.F.M. Wennink 7b. Notification of the intended reappointment of Mr. M.A. van den Brink 7c. Notification of the intended reappointment of Mr. F.J.M. Schneider-Maunoury 7d. Noti
Slide 52: Agenda
Agenda 8. Composition of the Supervisory Board 8a. Notification of Supervisory Board vacancies (Discussion item) 8b. Opportunities to make recommendations by the General Meeting (Discussion item) 8c. Announcement of the Supervisory Board’s recommendation to reappoint Ms. T.L. Kelly and appoint Mr. A
Slide 53: Agenda
Agenda 9. Proposal to appoint KPMG Accountants N.V. as external auditor for the reporting years 2023 and 2024 (Voting item) April 29, 2022 Page 53 Public
Slide 54: Agenda
Agenda 10. Proposal to appoint Delloitte Accountants B.V, as external auditor for the reporting year 2025 (Voting item) This agenda item has been withdrawn and removed from the agenda April 29, 2022 Page 54 Public
Slide 55: Agenda
Agenda 11. Proposal to amend the Articles of Association of the Company (Voting item) April 29, 2022 Page 55 Public
Slide 56: Agenda
Agenda 12. Proposals to authorize the Board of Management to issue ordinary shares or grant rights to subscribe for ordinary shares, as well as to restrict or exclude the preemption rights accruing to shareholders (Voting items) a) Authorization to issue ordinary shares or grant rights to subscribe
Slide 57: Agenda
Agenda 13. Proposal to authorize the Board of Management to repurchase ordinary shares up to 10% of the issued share capital (Voting item) April 29, 2022 Page 57 Public
Slide 58: Agenda
Agenda 14. Proposal to cancel ordinary shares (Voting item) April 29, 2022 Page 58 Public
Slide 59: Agenda
Agenda 15. Any other business (non-voting) April 29, 2022 Page 59 Public
Slide 60: April 29, 2022 Page 60 Public
April 29, 2022 Page 60 Public