Q1 2024 HUYA Inc Earnings Call

In the company's prospectus and other public filings as filed with the U S Securities and Exchange Commission.

The company does not assume any obligation to update any forward looking statements, except as required under applicable law.

Please also note that who yes earnings press release and this Congress call include discussions of unaudited GAAP financial information as well as our updated non-GAAP financial measures <unk> press release contains a reconciliation of the audited non-GAAP measures to the audited most of it there.

Actually comparable GAAP measures with that I'm pleased to turn their culture, our co CEO and SVP. Mr. Huang. Please go ahead.

Huang: Okay. Thank.

Huang: Thank you.

Huang: Hello, everyone. Thank you for joining our unencumbered as of today we.

We are pleased to deliver first quarter results building a house.

This expansion.

Huang: Gross being game related services and a more stable overall revenue trend.

Huang: We also improved our profitability with non-GAAP net income reaching approximately.

Huang: The $92 million.

Huang: With 'twenty 'twenty four off to a good start I'd like to share some details about the year's key strategies and recent developments, including our strategic transformation and commercialization focused.

Huang: Content platform ecology upgrades and technology product.

Huang: <unk>.

Huang: Let me start with an update on our strategic transformation.

Huang: We are making encouraging progress in the commercialization of our game related services.

Huang: Driven by the rapid growth of revenues from game distribution and advertising services as well as in game item sales.

Huang: Our game related services advertising and other revenues, formerly know as advertising and other revenues reached RMB 244 million for the first quarter.

Huang: Representing growth of 137, 6% year over year, and 30.7% quarter over quarter.

Huang: This growth reflects a strong and engaged base of high value camera users on our platform embedded in our new directions potential.

Huang: In terms of game distributions.

Huang: <unk> our coverage to include more games, both upcoming and existing titles.

Huang: Our gamma user tend to have high commercial value potential with users.

Huang: Users average spending level drove we asked distribution channel performing well, particularly in the MMO and LG categories.

Huang: We are also refining our operations to capitalized on their value as we develop a game distribution services.

Huang: In game item sales, we offer a diverse range of popular again props for a growing number of games.

Huang: Additionally, we are expanding our offering of broadcaster customized in game virtual items to help strengthen connections between broadcasters and their fans with regard to game advertising services, we are working with more game companies and carrying out in non <unk>.

Huang: Broadcaster promotion activities and campaigns.

Huang: We are also actively preparing for the.

Huang: Upcoming launch of eagerly weighted TNF mobile game to cease related opportunities in game distribution and promotion.

Huang: In addition to providing rich live streaming content and more comprehensive services related to lift again for our users and theater game studio, we will leverage this game to grow our game related service revenues.

Huang: In addition, I want to point out that we typically recognize revenues from game distribution and in game item sales after revenue sharing with the game companies that is on net basis.

Huang: That means game related services Act true total transaction value is much higher than its revenue gain.

Huang: <unk> related services strong and rapid growth this quarter reinforces our confidence that this business revenue will continue to scale.

Huang: Also as game related services tend to offer higher gross margins this business should.

Huang: Accelerate improvements in our overall gross margin and profitability as its contribution to total revenues increase.

Huang: In the long term lease transformation will not only enhance our revenue mix Bob put also enhanced our revenue scale and profit levels.

Huang: Turning to content platform ecology, strengthening our cooperation with various platforms and products to enhance our platform ecology is a key strategy for us in 2024.

Huang: In the first quarter, we hosted the new year's esports all star event. The incorporation was three other major game live streaming platforms.

Huang: League of legends.

Huang: Of Kings.

Huang: <unk> elite competitions broadcast on multiple live streaming and content platforms.

And he will explain later on how KPMG conducted its audit and finally, we have mark you'll molinaro of Ernst and young present E Y and we will propose to our point E Y as auditors for the fiscal year 2025 under item seven on the agenda.

Before we start some announcements M U nowadays.

Just like last year. This general meeting is a physical one the emergency law that was in place during Covid expired last year, so having a hybrid meeting with remote voting is not possible anymore for ASM as Disposability is not provided for in our articles of association or shareholders happy.

Huang: Opportunity to cast a vote and a voting proxy.

Speaker Change: And the addition of live webcast in English and in Dutch of the entire meeting is available to Dow shareholders, who are connected via the company's website and you were able to register for this as indicated in the convocation of this meeting no picture or sound recording is allowed during this meeting except by the professional photographer we have.

Huang: Allowed today and I would also like to remind you to turn off your.

Cell phone or yes, or muted then when it comes to questions related to the agenda. Following as indicated in the qualification registered shareholders had until two P. M last Monday may six to submit questions in writing via the email address AGM at a S. M Dot com I can inform you that this.

Huang: Used ones and we have therefore prepared for these questions.

Huang: So the more those present in the room can ask questions at the times that what we indicated during the meeting the staff member will walk around with a microphone and if you have a question you can raise your hand.

We will group some agenda items. So that you can ask questions for each block of the relevant agenda items and you know this is to speed things up not to be here at night.

Speaker Change: And the vote on the relevant block will also take place at one time. So if you ask the floor I like to ask you to begin by stating your name and who if any you are representing and in doing so I ask that you not ask more than one question and one round. If there is sufficient time, obviously I will give the opportunity for a second and possibly a third round of questions.

Huang: <unk> questions may be asked in either Dutch or English and the those of you who appreciate it you were able to obtain headphones at the entrance as so to hear simultaneous translation from English to Dutch and vice versa. So during the meeting.

Huang: Questions and answers off during the meeting will be included in the minutes of this meeting.

Huang: And these minutes will be posted as draught shown a S. EMS website within three months and shareholders will then have three months to respond.

Speaker Change: I would also like to inform you about voting there are two ways to cast your vote.

Huang: Those entitled to vote at this meeting can cast their vote using eight voting device.

Speaker Change: With a voting cards and you received it at the registration desk I hope and when you place devoting caught with the gold chip into the keypad and your name appears on the screen you aren't ready to vote.

Speaker Change: If at any time, you have trouble casting your vote. Please raise your hand, so that you may receive assistance in resolving the problem.

Huang: The device and the voting card must be returned or in turned in at the exit of the room.

Huang: When you are.

Huang: Finally exited smoke when you temporarily leave the room once I open to vote, you will have the opportunity to vote. The choices are one two or three choice. One represents four two is against and three is abstention you can change your vote until I close the vote and your last choice made cuts.

Huang: You have also been able to vote by proxy. If you have done that then you have already given your voting instructions to Mr. Michel phone after a notary Mr. From ox will ensure that the voting instructions are carried out then.

Huang: Then for U S proxies issued by New York Registry shareholders. The voting instructions will also be carried out lawfully.

Huang: Yeah.

Huang: As I have explained to you we will work with some vote or voting blocs.

When asked the questions about the relevant voting block in advance and after that votes will be taken on the agenda items in that respective voting block. The voting blocks are defined as follows the first voting block.

Huang: Is items three and four so the annual statement with the remuneration report the adoption of the dividend proposal discharge of members of the Executive Board Supervisory Board. The second voting Bloc is item five and six so that supervisory board renew Mauritian proposal to amend the remuneration.

Huang: <unk> policy for the supervisory board members and the proposal to amend the remuneration of the members of the supervisory board and its committees and item six composition of the supervisory board with reappointment of DJ law Mush and the appointment of Tania Micki and Martin from then bring and then the third voting block which is items seven.

To 11.

Huang: Item seven days the appointment of the auditor for fiscal year 'twenty 'twenty five.

Huang: Then I ate designation of the board of management as the authorized to issue common shares and grant rights to subscribe for ordinary shares and limit or exclude the preemptive rights and item. Nine then the authorization of the board of management to repurchase ordinary shares and ASM item 10 proposal to withdraw.

Huang: Cancel ordinary shares held by a seminar.

Huang: 11 is a proposal to amend the articles of association. That's block three now during each voting block votes may be cast on all resolutions or voting items and at the end of each of that such block I will show you the voting results and for the sake of clarity at the end of the meeting I will show you devoting results for all eyes.

Huang: James on the agenda.

Huang: So the results of the items, which will be voted on will also be posted on the company's website within 15 days.

Huang: That all documents for the meeting were post stood on the company's website on March 26th.

Huang: The complication of the notice that was issued this same day also stated that the full agenda with explanatory notes. The 2023 annual report, including Remuneration report and all other appendices where available for inspection at the company's offices and that ABN Amro Bank N V and stem the U S P.

Huang: He can't attendance card and she was noticed God. We're also posted and scent on the website and for the sake of completeness I also report that the record date is April 15th 2024.

Huang: The total number of issued shares on the record date April 15 was 49 million and 428548.

Huang: There were 213931 shares in treasury on that date, and thus $49 million 214617 shares could be voted on.

Speaker Change: After item to Michele will the notary will communicate to me. The final number of shares that have been registered and that have voting rights in this meeting.

Speaker Change: On this basis I note and conclude that the shareholders have been correctly convened according to the articles of association in legal provisions and that therefore resolutions can be validly passed in this meeting.

Before we start with the report on the financial year 2023, we would like to provide.

Speaker Change: Tentative update on a number of remuneration issues with respect to the executive Board, we had a dialogue with various stakeholders, including a number of our shareholders regarding.

Speaker Change: Regarding item five the adjustment of remuneration policy for the supervisory board. During these discussions several stakeholders ask more information Oleds are also on ECM SaaS remuneration after appointment as C. And also on Benjamin low severance scheme, and the nonfinancial targets applicable to the executive board for FIS.

Speaker Change: School year 2020 full of Cogs.

Speaker Change: All of these issues will come back next year in the remuneration report 2020 fault, but we promised and we understand the questions and therefore promised to address these issues and in part as part of this AGM.

Speaker Change: I would therefore like to give the floor to D. J languished chair of our nomination selection and remuneration Committee to comment on these three issues.

D. J: So D. G go ahead.

D. G: Thank you very much ladies and gentlemen.

D. G: The chairwoman food I will provide you with some details regarding do you.

Sure.

D. G: <unk> CEO, Mr. Benjamin Lu.

D. G: And the second step we have an overview of the remuneration aspects and details of the newly appointed CEO, Mr. Sherman Saga and finally this call.

You can say that the requests are for many of our shareholder which we meet at least regularly at least once a year to provide more transparency on the way the supervisory board. If it's a short term targets for the management Board. We will then disclose the nonfinancial targets for the my name as part of the management Board.

D. G: Short term cash incentive scheme as applicable going forward in 2024.

D. G: This explanation again has been promised before to some of our investors.

D. G: I would call more engagement sessions.

D. G: In February of this year.

D. G: But at that point is Sims performance targets switching process was not completed yet so that's why we give those details today.

On the first slide which is showing up.

Behind me.

D. G: I don't know who's thank.

Speaker Change: Thank you.

Speaker Change: First of all let's let's cover the remuneration aspects related to the departure of a.

Speaker Change: Hello.

Speaker Change: See you.

Speaker Change: Given his departure there they will be there will be of course, no salary increase no long term incentive grants awarded for 2024.

Speaker Change: As far as the short term incentive is comes film measurement will receive a prorated short term incentive.

Speaker Change: Living for the period that you served as CEO in 2000 and for meaningful January 1st until today.

Speaker Change: Furthermore, a bunch of them might will be eligible at the date of his exits which is actually today.

Speaker Change: For an accelerated vesting of the two outstanding long term incentive grants, which you received in 'twenty to 'twenty, two and 2023.

For avoidance of doubt we can also confirm and that was a question that we received also.

Speaker Change: There is no severance in any form paid to Benjamin.

Speaker Change: Lastly, and as previously already communicated that we can confirm that Mr. Lou as accepted to stay and we thank them for that to stay on for three months, but obviously no longer as a member of the management board to support a smooth CEO transition and the game renew on B.

Speaker Change: The board all our thanks for for example.

Speaker Change: As well the game as is remarkable contributions in <unk> 'twenty 'twenty.

Speaker Change: We can go now to slides number two thank you.

Speaker Change: Let me now elaborate on the compensation package of the new incoming CEO, Mr. I'm sad as applicable as of today.

Speaker Change: Proposed compensation has been set in full compliance with our remuneration policy, which has been approved at the AGM on May 15 last year.

Speaker Change: It has also been set taking into considerations the expertise the experience.

Speaker Change: The contribution of the new CEO as well as <unk>.

Speaker Change: Full competitive benchmarking, which has been conducted by a third party external consultant.

Speaker Change: The fixed annual gross salary for me, sometimes inside will be seven in 10-K U.

Speaker Change: No.

The short term incentive Uptown guarantees wanted to represent all of the annual beef and the LTI as a long term incentive targets remains unchanged vis V is current remuneration.

Speaker Change: As to <unk>, 450% of these annual beef, which as you know.

Speaker Change: Is reflective of the U S market practice, given the fact that <unk> previous employment background is in the U S.

Speaker Change: You shouldn't read to relocate to the Netherlands during the summer period on some typical international mobility benefits will be applicable all in line with our management Board remuneration policy.

Yeah.

Speaker Change: Last but not least and that's some details are provided on the following slide which is going to come here last but not least next one please I would like at the request of for many of our shoulder we'd like to spend some time also on explaining the nonfinancial targets for the management.

Speaker Change: <unk> 2024 going forward as far as the short term incentive is concerned.

Speaker Change: As you can see on the slide 10, and I'm not going to cover all the details of those as you can see on this slide. This is a mixed of mainly ESG related targets such as the continuation of a net zero 2025 pathway as.

Speaker Change: As well as a series of people related targets in the domain of leadership development.

Culture.

Speaker Change: Engagements as well as organizational design.

Speaker Change: Also as you know this year visa specific cure in term of use ease of preparation of the European CSR. The reporting and disclosure is one of the targets, which is extremely important issue and another target also ease of safety performance recorded across the <unk>.

Speaker Change: Company.

Speaker Change: Lastly, our company specific targets strategic target I should say the implementation of the new ERP software, namely is S. A peaceful Emma has been added to the STI targets for 'twenty four.

Speaker Change: And you see on the slide behind me is the with the respective width of each of those targets.

Speaker Change: And with that I give you back the mic.

Speaker Change: Putin.

Putin: Okay. Thank you.

Putin: Thank you D D well that this is the interaction and this is not for further discussion now that since you've received lots of questions about this in a couple of months of fat.

Putin: This year the parties have behind Us the company.

Putin: Skating already shared with you now I would like to continue with the agenda and with the first substantive agenda item. He first substantive agenda item concerns T. A report for the fiscal year 'twenty. Three this is an item for discussion and it consists of agenda items, two a and two b. So two parts you'll start.

Speaker Change: To aid this as you report on our fiscal year 2023.

Speaker Change: But as Stuart mentioned terrible that's report on that yet, but they will also play an explanation on it.

Speaker Change: And before the what management will do so I ask hey, Kathy the supervisory board I would like to make some comments about the last fiscal year.

Kathy: Thank you for the thinking was that a year to be proud of for S. M.

Kathy: It was a difficult here in the semiconductor market.

Kathy: Several of our customers put investments on hold nevertheless, as in previous years a S. M was able to grow its sales.

Kathy: <unk> is a performance.

Kathy: Outperformed the market he focused on spring thing ASM intention to three almost a view of its medium and long term growth plans.

Kathy: He supervisory board and the management, often discussed turnkey isn't as opportunities in the areas of customers' products technologies and talent attraction and retention in a quieter market like tier two tier three it was important to improve the supply chain and find ticket balance between working capital and.

Kathy: Inventories also given the costs of our materials and therefore, a recurring theme in our discussions with E Tech Committee and the board of management.

Kathy: Part a is for IC potestas involved in various investments from R&D to lead to large scale expansions in Korea, and Arizona that ASM announced last year, we discussed.

Current geopolitical tensions and increasingly stringent export controls.

Kathy: I can set from the U S.

Kathy: Regulatory changes and other developments.

Kathy: He said he and sustainability. We're also frankly need discussed at meetings of the audit Committee and the supervisory board as a whole.

Kathy: He also went into a sustainability innovation.

Kathy: These are important because ASM is highly dependent on its customers and value chain to be able to reduce its scope three emissions.

Kathy: Moreover, we paid a lot of attention to diversity and inclusion with new higher targets in terms of a more balanced distribution of men and women.

Kathy: The organization and the culture of ACM. This also includes talent management and attracting good talents.

Kathy: But also retaining them.

Kathy: Talent retention development and advancement of these employees as a man myself T supply support we also met very sad talents.

Kathy: All of us to hear what is going on and how they see ASM.

Kathy: In conclusion, the supervisory board looks back on a very successful and supplying here.

Kathy: For all that she expressed how things to the board of management, The Executive Committee and of course add to all of the year. Some colleagues now I would like to give the floor to Benjamin now chairman of the ex U S export in CEO and after this Paul Farrell CFO and member of the Board of management will say something about the companies S. T policy Benjamin piece.

Benjamin Lu: Afternoon to everybody and I just wanted to start off by acknowledging I mean, all our policy.

Unknown Executive: Pauline for her very kind introduction at the beginning thank.

Unknown Executive: Thank you very much Colin.

Unknown Executive: I will give a report on what we have done in 2023 and also tried to give you an outlook of 'twenty 'twenty four and beyond.

Speaker Change: How do I control this.

Speaker Change: So just the cautionary statement, we can move on to the next slide.

Speaker Change: So you know my report will be broken up into a six spots.

Speaker Change: A couple of key messages that I would like to share a review.

Speaker Change: And then we look into a little bit of details on 2023.

Speaker Change: And then we proceed to Oh, Okay, what does the outlook for 2024 looks like.

Speaker Change: And then we will expand on what we are doing in terms of ESG and a very important topic for US is of course the people a topic that will be following the ESG and finally, a little bit longer term on what the midterm brings for ASM.

Speaker Change: So 2023, just to repeat what Pauline as mentioned I think it was still a and another successful year for us It was not an easy year. It was a difficult year.

Speaker Change: We grew at 13% at constant currency, but quite a number of our peers actually recorded negative growth simply because the industry was going to have inventory correction and investments were held back but I think we managed to excel and outperform the market by growing.

Speaker Change: 10%.

Speaker Change: We also have continued to invest and increase our head count by about 7% and this was necessary in a difficult year, because we know the subsequent years, we're going to expect a significant growth and we need to be prepared for that.

Speaker Change: And similarly, you know are we continue with our people transformation strategy, along four pillars, which I will share with you later on.

Speaker Change: At the at the heart of ASM people is what really matters Pearland is what really matters and we need to continue to build on that.

Speaker Change: Sustainability, one of the things that we are especially proud of is the last year, we had our net zero 2035 targets validated a very fine.

Speaker Change: By the SB Ti and we were actually the first in the <unk>.

Speaker Change: Industry or to have done that so right now and starting from this year, it's execution and we are putting all the plans together.

Speaker Change: One big opportunity for us going forward of course is the inflection from a you know the finfet transistor architecture integrate all the Valentine's just architecture.

Speaker Change: That is going to present, a significant benefits, especially for the type of equipment that we produce and we do expect that the transition to a gate all around this is going to loss again, just like the finfet transition for the next 10 to 12 years, So theres a lot of opportunities in front of us.

Speaker Change: AI is now pretty much a big buzzword I think all of US are hearing about it to some extent also impacted by it.

Speaker Change: We are very actually enthusiastic about this I think we are very well positioned for some of the AI applications.

Speaker Change: That will come as our customers start to manufacture more and more AI related semiconductor components.

And we look at you know how are we going to make sure that we have enough capacity in all the way until our midterm target of 23, seven so we have already taken that into consideration and I must say a review of some of the expansion investments that we have done but as of today, we are quite confident that we have.

Speaker Change: Now have capacity to make sure that we can deliver on the high end of our 22007 midterm target.

Speaker Change: Next.

Speaker Change: So maybe let's dive into 2023.

Speaker Change: So 2023 again was a tough year for the semiconductor industry. After very significant growth in 2022, I think when you look at semiconductor chip sales it was probably down by more than 10%. If you look at the market that we play in with wafer fab equipment and he was kind of flat maybe a slight negative but we are taking.

Speaker Change: It's more flat than negative and against that you know basically what we will see is that there was a slowdown in leading edge.

Speaker Change: Logic and foundry investments memory was down and I will show you in another chart, but this was compensated by the older legacy or mature not the investment which will help to prop up the overall market.

Speaker Change: One bright spot for US was the silicon carbide epitaxy business. This was an acquisition that we did of an Italian company called L. P and that's showing up now a lot of our good results in fact.

Speaker Change: Probably triple the head count there because of the demand and a significant amount of work that we have to do and you know we gave a target to the market that we would see.

Speaker Change: Significantly increased revenue to at least 130 million euros, which we exceeded that.

Speaker Change: So we are now in a very good position and also to continue growing.

When the market comes back.

Supply chain constraints, maybe again to repeat what Pauline has mentioned that you know since the end of 'twenty, one the whole industry and actually many other industries have been constrained by the supply chain, but we all see things.

Speaker Change: Things are improving.

Speaker Change: And except for certain specialty materials I think.

Speaker Change: The market has by and large a normalize and we are or we have during the last two years done a lot of work to make sure that when the ramp in the semiconductor industry comes again, we are prepared so we have done a lot of work to try to mitigate any of us next.

Speaker Change: Okay.

Speaker Change: And in 'twenty to 'twenty, three we continue to invest especially in R&D and again I will come back to this is a slide that we show you our which are the areas that we have been investing a big part of it is actually in our R&D infrastructure, we had to do that because.

Speaker Change: The opportunities in front of US. This is just a huge and our customers are pulling us to do a more and more.

Speaker Change: We are again for the manufacturing of capacity part of it or we completed the expansion of our manufacturing facility in Singapore, which is basically responsible for 80% to 85% of our total output. So you know we have now everything in place and we also have kicked off.

Speaker Change: And the expansion in Korea, 100 million expansion, which is now under construction that was also a triple the amount of manufacturing space that we have in Korea and double the amount of fall in this space that we have in Korea that facility or that construction should be completed by sometime in the first half of 'twenty.

Speaker Change: 25.

We also announced we haven't stopped the work yet, but we announced a 300 million your expansion are in.

Speaker Change: In Scottsdale in the in the U S that is going to be our flagship facility in North America.

Speaker Change: And we are all are eagerly looking forward to that we're in the process now of working through the design of the permits and so on and hopefully we'll be able to start the construction soon but that will be a major addition, as far as our R&D and to some extent pilot manufacturing capabilities.

Speaker Change: Capabilities are concerned.

Speaker Change: The net zero 2035 targets I've, just mentioned that AR and the thing that makes US proud is that we were the first in the industry and we wanted to make sure that we are you know I'll be very transparent with our targets.

Speaker Change: We are of course very glad that after a lot of work. This has been validated by science based target initiative.

Speaker Change: And then in terms of people, we continue to build on our culture.

Speaker Change: The core values that we can innovate we deliver and we have supplemented this actually ever seen to.

Speaker Change: 2022 with the cold behaviors of accountability collaboration and empowerment and that we have put there was sort of a special focus on inclusion equity and diverse diversity I think that comes hand in hand with the values that we believe in and we are working towards.

Speaker Change: Increasing you know for example, whether it's gender diversity or various diversity within the company next.

So a snapshot.

Speaker Change: So 'twenty to 'twenty three.

Speaker Change: The seventh consecutive year of double digit growth and we grew at 13%. So you can click on one thing.

Speaker Change: Yeah.

Speaker Change: Okay. So we grew at 13%.

Speaker Change: The probably negative aspect of last year's market was the drop in our memory sales I think there was a drop of a probably greater than 40% of in terms of investments by the customers, but nevertheless, the memory segment is a smaller part of our our business and this was more than compensated by a one.

Speaker Change: He called the the key Gulf or the significant growth in the mature logic and foundry.

Speaker Change: And also legacy type chips, which is in power analog et cetera that more than compensated for the drop and the resulting in our ability to continue growing.

Speaker Change: A pretty tough year in 2023.

Speaker Change: <unk>.

Speaker Change: So snapshot again financial performance I think here you can see you know our revenue was a record profit.

Speaker Change: Profitability, whether it's in terms of operating profit free cash flow they were all up.

Speaker Change: What do you call a profit a record levels and as you know due to our I would say, a better mix and especially quite some business coming in from China.

Speaker Change: We also achieve a very good gross margin.

Speaker Change: <unk>.

Speaker Change: Here, maybe to share some of the new technology is that you know is going to help us continue to drive the business.

Speaker Change: One of course is a method of LD. So just just to recap two of the biggest plays that we do is in the ALJ equipment and silicon epitaxy equipment and a O D a council.

Speaker Change: More than half of our total equipment sales. So it's a it's a major part of our business.

Speaker Change: And we are going into a metal L. D and you know an opportunity is now are just in front of us with the transition from copper in tungsten and tamale. So we are heavily engaged with our customers and in fact that we already have secured some initial wins. So that's going to help us over the next couple of years.

Speaker Change: Silicon epitaxial something that if I look at where we came from let's just say 10 years ago, we probably had a low single digit type of market share at the end of last year. We were above 20, and we are on track and we are confident that we will reach a 30% market share by the time we finished.

Speaker Change: 2025, so we are making significant gains in the silicon epitaxy market and again this will be another.

Speaker Change: Key driver for us over the next couple of years and we are winning because we have and we offer a.

Speaker Change: The most competitive our technology.

Speaker Change: Technology that is available on the market today.

<unk>.

Speaker Change: A little bit on.

Speaker Change: The awards that we got from our customers. So as usual with all three because customers are we are we get daily awards, but this is a lot.

Speaker Change: Actually we are we'll be getting the award in June even though its published before 2023, we are especially proud that with Intel we want to get the highest level of award which is outstanding.

Speaker Change: We are one of only two equipment suppliers that we'll be getting that award and it's primarily based on the support and technology that has differentiated us from some of our competitors.

Speaker Change: In the same vein, we are very proud that for the first time.

Speaker Change: In Asia, we have been awarded.

Speaker Change: Best Company to work for one of the best companies to work for and one of the most carrying companies I think this is a testament to some of the work that we've been doing over the last four years in terms of our values.

Speaker Change: A week here and I really am very proud of this H All awards that we got for Asia ex.

Speaker Change: Just a quick snapshot so ASI has been growing over the years. So many years ago. We were number 12 under W. F E. We got to a number seven in 2022 and last year, we move up one more notch. So we are now the sixth biggest Wi Fi equipment supplier in the world, which means also.

Speaker Change: That you know we are now to some extent a view.

<unk> as a major supplier by all of the key semiconductor companies.

Speaker Change: Next.

Speaker Change: A little bit on the index return compared to the AVX and to our Sox, which is the semiconductor index I think we have done Ralph ourselves over the last couple of years and here I would like to maybe add a comment.

Speaker Change: Of course, we have done very well and Napoleon was very kind to to.

Speaker Change: I will say that it was because of me as it is not it's not really just me, it's the entire team and especially the employees of the company everybody has put in and contribute that and this is the reason why we have this kind of results.

Speaker Change: Next.

Speaker Change: Outlook for 'twenty 'twenty four next.

Speaker Change:

Speaker Change: Talk about a little bit earlier this is happening all around us whether it's large language models, whether it's generative AI, but I think you know we also seeing are being adopted implemented with autonomous driving US. We are also seeing our edge devices starting to have AI functionality, whether it's smartphones.

Speaker Change: Were those Pcs I think those will be coming out in the second half of this year now overall I think we are going to see a are you being a significant driver of growth for the semiconductor industry and our view is that we are still very much at the beginning this has a long way to go and that will be good for the semiconductor industry and to some.

Speaker Change: Extended especially for ASM, because we play in the leading edge type of technology and a lot of the AI chips components are manufactured at the leading edge next.

Speaker Change: Something that we showed already sometime back in September last year at our Investor Day, we are quite bullish that by a <unk> 2027.

Speaker Change: All logic devices are at least at least 30% of them will have some kind of AI functionality.

Speaker Change: This is going to help drive a again a lot of advances and also capacity to be added as far as leading edge logic and foundry.

Speaker Change: Manufacturing of chips or concern.

Speaker Change: <unk>.

Speaker Change: Something which I alluded to in 'twenty.

Speaker Change: Slide 23.

Speaker Change: Gate, all around or the inflection forget all about is very important for us because this is where the most advanced technology and semiconductor has been played out and you know this is like it's a little bit technical but just to give you a preview I'll show you what are the opportunities that are ahead of us and there are many many opportunities both.

Speaker Change: In LD and in Epitaxy, which are the two main products that we have we look at the new interconnect metals, we look at selective deposition processes and we look at embedded functionality. All of this will require more L. D. More epitaxy and this is really going to help us drive the business in <unk>.

Speaker Change: So the business over the next couple of years that's.

A little bit on the general market. So if you look at 'twenty two 'twenty three 'twenty four I mean, the market the Wi Fi market, which is where we play and was generally flat so even for this year.

Speaker Change: Consensus is that the market is generally going to be a flat, maybe a little bit of growth.

Speaker Change: But the positioning is that 'twenty 'twenty four is going to be positioned as a goofy or for 'twenty 'twenty five onwards, and if we look at the tag insights and they've gotten a industry.

Speaker Change: The specific type of forecast. It in fact is showing that there will be significant growth coming in 'twenty five 'twenty six.

Speaker Change: And that's one of the reasons why we also need to be prepared for the growth and one of the reasons why we continue to invest both in infrastructure and also in our people.

Speaker Change: <unk>.

Speaker Change: This is a slide where I tried to explain to you. What we are doing in terms of expansion. So if you look at Korea, we had groundbreaking in May last year, and we have started construction of our new facility, which is next to our existing facility, which will triple the amount of manufacturing space.

Speaker Change: And double the amount of R&D space, both are solely required because we are expanding very quickly in Korea.

Speaker Change: And then we look at the U S. You know, we had an event to kick it off.

Speaker Change: With a $300 million investment and we were very fortunate that we could tie.

Speaker Change: This together with the visit of Dutch Prime Minister.

Speaker Change: Mark water. So he attended together with the Minister Mickey advancing so he was a great event for us and as I said, we are now in the process of finalizing design and permits and hope to be able to start construction soon.

Speaker Change: In Japan, we actually already expanded in previous years, but last year. What we did was we made the office we renovated office just to improve the working environment for our employees because the office or so so becoming them too crowded and we have to reorganize and rearranged.

Speaker Change: Singapore, the our expansion of the second manufacturing floor, which is a major preparation for us for 2025 and beyond.

Speaker Change: The Netherlands in Taiwan, what we did was we are you know create that training centers demo centers for our equipment, both in Taiwan and also here in the Netherlands here in Armenia.

Speaker Change: And what is not shown here with the acquisition of our let's say L. P E business in Italy, we also.

Speaker Change: Renovate that expanded.

Speaker Change: The demo and process lab that we had in cattaneo. So that is now a much more I would say the professional and presentable and we have had a lot of customers go to therefore demo work and then also for process development book. So that's what we have been doing in terms of R&D and manufacturing as we go into.

The rest of this year and also into next year as and when we see that there will be additional necessity to expand that's what we will do because organic growth that is probably the first pillar of our capital allocation policy next.

Speaker Change: And a little bit on the E. Zpass. So you know we do not believe it not just setting targets. We wanted to take action we are firm believers in at all.

Speaker Change: What we need to do as far as the climate environment is concerned. So we have done a materiality assessments with our various stakeholders and with this we have now prioritize what we need to do which is shown on the right of this chart and of course, we are fully subscribed and follow the five as D. G goals are in our that also listed.

Speaker Change: Here, which is clean energy et cetera. So that's what we focus our efforts on and in terms of the priorities of course climate.

Speaker Change: One of them, but it goes beyond that and we look at for example.

Speaker Change: What we do as far as developing our people.

Speaker Change: You know as far as the supply chain is concern living wage, which is something that we are part of our because we already in 2021, well one of the.

Speaker Change: Leading advocates with the responsible business alliance and <unk>.

Speaker Change: Now we have a task force that is in the I'll be looking at that and we are waiting for their guidelines.

Speaker Change: And making sure of course that health and safety.

Speaker Change: The priority for all of our employees.

Speaker Change: Thanks.

Pauline mentioned, a little bit about the ESG ratings, and we are actually very enthusiastic and proud of what we achieve I think in the CDP a rating.

Last year for the first time that we have achieve AA minus.

Speaker Change: And you know we are.

Speaker Change: Our rank among these are the top especially in our industry of area. If you look at sustaining.

Speaker Change: We have improved so significantly and we are actually number one in our peer group and.

Speaker Change: Number three in the wider industry group some of this.

Speaker Change: We are very proud of and it's not just the right things, but I think it's a recognition of the efforts and the the resources that we have put in to make sure that we do a good job as far as ESG is concerned.

Speaker Change: Next.

Speaker Change: Net zero 2035 targets as I've mentioned, our we got our targets validated by S. P. T. I lost you in July and since then we have been putting together all the different plants.

Speaker Change: That is going to help us get there one of the things that we are oh, which even before the targets were validated which we have really set for ourselves was to get the renewable electricity are 100% by end of 2024 and as of last year. We were at 88%. We are confident that we will get there.

Speaker Change: A 100% by end of this year.

Speaker Change: We also launched the climate or we publish our climate transition plan in March this year as a result of all the work that we needed to do.

Speaker Change: And then maybe a last but not least so we are building new facilities in Korea and later on in Arizona as well both of them are designed to gold standards as far as environmental Friendliness is concern and that's something that we will continue to do all new infrastructure will be.

Speaker Change: Mental friendly.

Speaker Change: Next.

Speaker Change: Supply chain, that's something that we also did quite a lot of work in 2023, whether it's you know getting the oh suppliers to do the I'll be your assessment. So that we can understand what is the race.

Speaker Change: Getting our suppliers to disclose them.

Speaker Change: Let's say climate.

Speaker Change: Action According to a CDP a responsible minerals are making sure that our suppliers use certified.

Speaker Change: Smelters and refineries.

Speaker Change: And we have been engaging strongly with all suppliers. This actually started a media you know sometime I would say in 2021.

Speaker Change: We are in 2022 for the first time, a gave a supplier award to.

Speaker Change: Two suppliers that have performed well for environmental reasons, we call. It a prism award twenty-twenty towards the first 2022 was the second year and we will continue to do that to acknowledge and recognize our suppliers who do a good job in this area next.

Speaker Change: Our people and the people transformation strategy is at the core of what we need to do over the next couple of years I think a lot of us know that I'm in.

The semiconductor industry one of the biggest bottlenecks that will happen over the next couple of years is stellar.

Speaker Change: And of course, there are various initiate these are both by the government.

Speaker Change: The combination of private and government that's trying to address that by the end of the day I think as corporations. We also need to do our part and we on our part have identified the populace. One of course is talent how do we acquire how do we grow our talent.

Speaker Change: We also need to focus on as the company goes to become a four to 5 billion Euro company by 2027, how do we scale up and the next thing that you know we need to focus on the.

Speaker Change: The semiconductor industry is changing changing very quickly how do we have an agile organization, that's able to respond to all the different changes that may come in front of us and last but not least we continue on our cultural journey, which we have started a couple of years ago trying to live our values and making sure that we all model to behave.

Speaker Change: Is that a necessary to create a one United S M.

Yes.

Speaker Change: Some key people facts and a as I said in 2023, even though it was a tougher year for the semiconductor industry, we still hired quite some people in fact, we increased head count by about 7% and B. How you get the 730 <unk> people are we.

Speaker Change: We of course as part of our inclusion in equity and diversity focus have hired more females and this will continue we have a target a 425.

Speaker Change: So our target for beyond and we are actively working towards that the other area that I think is of no noteworthy is if we look at the number of nationalities represented in S. M. A you know that has increased we now have 66 different nationalities working within the company and we also felt that if you look at the average removed.

Speaker Change: And of the employees. This has increased significantly from 99000 to 111000.

Speaker Change: Thanks.

Speaker Change: We are committed to building.

Speaker Change: The culture in our in our ASM. This journey has started already a couple of years ago, but we are accelerating that and again the core values that we can innovate we deliver underpinned by the Oh, I would say the model behaviors of accountability and empowerment and and collaboration.

Speaker Change: This actually helps us to drive employee engagement and underpinning some of this values and also the behaviors of course include that inclusion of equity and diversity and on the employee engagement part I think you know we are we have.

Speaker Change: Very clear signals from our employees that they want to have their voices heard in a pulse survey that we did last year, we had a 94% participation rate, which is really really high by industry standards and we are proud and happy that our employees are willing to speak up and let us know what is what needs to be improved.

Speaker Change: And how we can make the company better.

Next.

Speaker Change: Last but not least the midterm guidance and priorities. So the strategy of the company hasn't change.

Speaker Change: We show this for the first time in 2021 at the Investor Day in September and are by and large you know the.

Speaker Change: The strategic objectives of the company.

Speaker Change: With the strategic enablers remain the same of course, that's a you know as the market develops you know every year, there's a little bit of tweaking here and there, but if you look at the longer term. The strategy is intact and we are focusing on the right things next.

Speaker Change: Just another shot show that digital transformation is going to drive.

Speaker Change: The semiconductor business significantly grow the business significantly over the next couple of years and the often mention a number is that the.

Speaker Change: The amount of all the revenue for semiconductor chips are wall hit one trillion U S dollars by the end of the decade a.

Speaker Change: Last year it was probably in the mid 500 billion. So you'll see a significant growth over the next six to seven years next.

Speaker Change: And these are the targets that we have openly disclose and shared with all of the shareholders and also the investment community.

Speaker Change: Next year, we expect to be between three to $3 6 billion, which actually represents a 16% to 21% growth. If you compare that to 2020, where we are coming from and in 2027, and we expect and are confident that we will be between $4 billion to $5 billion, which is 11% to 16%.

Speaker Change: Compound annual growth rate.

Speaker Change: Compared to 2022, we are working diligently towards these targets and we are actually barring any massive.

Speaker Change: Changes in the market, we are confident that we will get there.

Speaker Change: Thanks.

Speaker Change: Again, the key takeaways.

Speaker Change: For all our shareholders 2023 was a I would say a pretty difficult year, but we still managed to grow 13%.

Speaker Change: We have increased our head count despite the difficult yet because we need to be prepared and talent is a major issue for the whole semiconductor industry our people transformation.

Speaker Change: Strategy continues through the four key pillars.

Speaker Change: We continue to focus on our sustainability after having had our net zero 'twenty five targets validated last year.

Speaker Change: Inflection a four to a form of Finfet gate, all around is providing us with a lot of opportunities to further grow the company.

Speaker Change: AI is a big buzzword today, it's going to be a big driver for the semiconductor industry and we are well positioned for that.

Speaker Change: And last but not least we have done Oh, we have taken steps to ensure that when the ramp comes probably starting from next year, we have enough capacity and we are well prepared.

Speaker Change: To do that next.

Speaker Change: And.

Speaker Change: This being my last E.

Speaker Change: E. G M. I would also like to say a couple of words.

Speaker Change: The last four years.

Speaker Change: It has been probably the privilege of my life to have been able to lead a S. M. I think I'm very on it.

Speaker Change: And I had great colleagues and also employees they have managed to grow the company to where we are today.

Speaker Change: But I also want to thank all the shareholders for your kind support over the last couple of years.

And as I transition to a sham I cannot be more happy that it will be in very capable hands and in fact, if I look at where the market is going to be over the next couple of years I'm more than confident that he is going to bring S. N to even greater heights. So once again I want to thank all of you for your support the last four years.

Speaker Change: It very much.

Speaker Change: [noise]. Thank you Benjamin they moving Paul.

Unknown Executive: He went from you.

Unknown Executive: Yeah.

Speaker Change: Sorry, so maybe a few more words on the on our sustainability policy that was as for maybe in addition to what Benjamin already S. As illustrated there just now.

Speaker Change: On the governance of course Supervisory Board Audit Committee is very much involved in overseeing what what we're doing.

Speaker Change: The management board being presence here of course take a lot of initiative and priority in making sure that.

Speaker Change: We drive for a sustainable value creation and long term for the company.

Speaker Change: And do you have a sustainability board and the company with Representatives from from business end to end global functions. So that's how we manage it I think a key pillar in the E part issues aren't net zero 2035 targets Benjamin talks about that so no need to repeat that.

Speaker Change: I think on the S. It's the people agenda that the Benjamin talked about and in particular you of course.

Speaker Change: Building, a diverse and inclusive culture, where we put a lot of emphasis on and all the chi of course being in Antigua and an ethical moral company with good two good behaviors. That's also where we believe we need to set the right tone at the top which we are.

Speaker Change: We I think all that will do and then last but not least we are putting a lot of effort. In this she is a D you're reporting which will become our in place. It from them from next year, we have a team.

Speaker Change: We are progressing well you might have seen in our annual report already this year that we've added quite a few no financial indicators and that's all let's say progress towards becoming fully compliant on the.

Speaker Change: On the one she has a deep and decent almost also have seen now for the third year in a row from old mistaken limited assurance.

Speaker Change: Through our external auditor KPMG.

Anything I leave it to that.

Speaker Change: Sure.

Thanks, a lot Paul.

Speaker Change: Who's done hand in hand.

Speaker Change: Right, ladies and gentlemen, this means that we will move to agenda to be which is the corporate governance structure in compliance with the Dutch corporate governance code in December 2022, an update of the corporate governance code was published by the corporate governance monitoring Committee, which I chair and in line with the monitoring committee's.

Speaker Change: Station ASM included the chapters of the 'twenty to 'twenty three annual report describing the corporate governance structure in compliance with the corporate governance code on the agenda Chapter 13.1 contains an explanation of corporate governance at ASM, including an explanation of the various bodies of the company sent their rights and obligations.

Speaker Change: <unk> for example, the role of the Supervisory board to the General meeting the management Board and the executive meeting on discussed sorry, Executive Committee I discussed as well as the relationship between the various bodies and in chapter 30 fault, we discuss compliance with the corporate governance code and we explained why we deviate from the code set.

Speaker Change: Certain matters and in summary.

Speaker Change: This concern that delegation by the supervisory board of contact with the internal auditor to the audit Committee. The majority of Supervisory Board members are members of the audit Committee and the committee is the most financially literate. However, it is guaranteed and the audit committee charter that the internal auditor may always escalate method.

Speaker Change: To me as the chair of the Supervisory Board.

Speaker Change: And for that same reason the internal auditor reports to the CFO ASM believes the CFO is best equipped to oversee internal audit and for the same reason the audit committee rather than the supervisory board maintains contact with the external auditor and the audit Committee therefore brace the auditor on its performance.

Speaker Change: Yeah.

Speaker Change: The updated code requires an organization wide diversity and inclusiveness policy, which actually should have been adopted in 2023.

Speaker Change: Adopted that's in February of this year.

Speaker Change: And it's.

Speaker Change: Two months behind.

Speaker Change: The code requires the chairman of the supervisory board should provide advice chat. The supervisory board have discussed this in the past, but had concluded at the time that it did not think it was necessary given the limited size of the supervisory board and on officially D and it's our chairman and fulfill their role.

Speaker Change: Advice chat given ASM growth. However, in the proposed expansion of the supervisory board from six to seven members of the Supervisory Board decided earlier this year after having discussed it again to formally appoint Mr. Lam mush as if I suggest so.

Speaker Change: On the more formal note and then I will now give you the opportunity here in the audience to ask questions about agenda item to report on the 2023 fiscal year I would like to remind you to ask a maximum of one question at a time.

Speaker Change: And.

Speaker Change: We have two.

Microphones in.

Speaker Change: The pathway. So if you can stand up and walk to the Mic you can do so if you.

I cannot.

Speaker Change: Walk up to the Mic we have another microphone that can come to you. So I would like to give the floor to who.

Speaker Change: In order to the interpreter.

Speaker Change: Okay.

They can automate a inaudible to D and temperature my apologies.

Speaker Change: It's been a heel blame me anything thought he could belong extra shall I say hip but.

Speaker Change: So in summary.

Speaker Change: Return on my shares is 5000%.

There is nobody else, who has that 5000% I acquire those shares a long time ago I never did anything with it and the return on those chassis as 5000%. It's the best performing share in the Netherlands, and I think.

Speaker Change: That's you're very happy.

Speaker Change: With me, stating this at the beginning I'm also very happy that in the Netherlands, We have a family run business called Heineken and we are very happy that Heineken is still in the Netherlands, and I'm really trying to get them extra stepping into the latest James bond movie together with that hotel to promote Heinekens here, a point zero and really make.

Speaker Change: A very popular drink the same applies to a semi.

Speaker Change: Because it was found it a long time ago I think Chuck.

Speaker Change: Built what his father created.

Speaker Change: And Benjamin low really put the turbo on it and his name is very very modest which is all nice.

Speaker Change: He is the engine.

Speaker Change: The company and the Great thing is we're moving from Asian regions, two African regions and I think there's a lot to do and at this moment not a lot is going on in the field of research that we've noticed in this country that people.

Speaker Change: Well, if you want people to stay there you need to have employment, there and a nice working climbing so and also the climate in general So a nice research lab or in Africa would be nice because the climate is not doing really well and we need forests and also ASM will benefit from stability.

Speaker Change: And we now have a very weird combination of Russia, China, North Korea, and Iran that is completely disrupting the world and they use terrorist groups for that especially Hamas.

Speaker Change: In Gaza.

Speaker Change: And this leads to a weird a dangerous situation also in the Netherlands. So it's very important that you with your powerful companies and network that you do something about it you can provide stability and regions. Because this is required for further growth.

Speaker Change: And what I have been missing here.

Speaker Change: Had not received an answer to my question was the actual value is of this company.

Speaker Change: And.

In the Netherlands, we say that we want a 50% are people from outside we have people.

Speaker Change: But a lot of experience in I T and cybercrime wouldn't it be great that you can send one of the people that work for you to sit in government because we don't have a lot of competent people in our government.

Speaker Change: So they could use your expertise.

Speaker Change: Yeah, we we ask one question at a time I actually wrote down several questions from your side Mr. For taken so that we can give the opportunity to other shale well. The good news here is that I have to leave pretty soon and so the number of questions is limited at this time and then of course I agree. So upon my leave I know you will not have.

Speaker Change: To answer my questions anymore, but I have a lot of positive feedback as well. This is my last one I don't think as semi is doing a lot of sponsoring in that and that's not in the van Gogh Museum et cetera, but with such great results as a company. It is important that our ASM has excellent sponsorships in the Netherlands and abroad.

Unknown Executive: So these are my questions and comments. Thank you Mr. Fagan.

Fagan: Yes, a couple of those are suggestions I think so thank you very much for those compliments and suggestions and congratulations on your share return of 5000% I think more people are happy about that you talk about employment in Africa, and a suggestion on N a S.

Speaker Change: Forrest in Africa, I think it's not the first time that you have commented on that I'm afraid, we don't have an answer to that yet, but we will include your suggestion you talk about stability in the world and a value of a semi is.

Speaker Change: Round 30 billion some slightly above do you have a friendly suggestion that people behind this stable shoot for government, but you do realize that they won't be able to sit on the board here right well you. They can choose our delegate people from their network.

Speaker Change: I completely agree with you Mr. Reagan that we should urge people with a certain expertise to do something to stand up and go into politics and stand for election, and you know if that is your point I I wholeheartedly agree with you.

Pal farhan: Sponsoring I would like to give the floor to Pal farhan.

Pal farhan: Correct.

Pal farhan: In the Netherlands, we might even have zero sponsoring so if it's there it's not big.

Pal farhan: In several countries that we operate in on a smaller scale, we do gets back to the community by initiatives that were founded by employees. They do charity work. We tried to do that here, which is different from sponsoring I understand but its still giving back to the community right and we believe it.

It's very important that our employees contribute to that and ourselves as well.

Pal farhan: Nevertheless, sponsoring is on the agenda and I do agree with you that we need to review the sponsoring policy, if you're a big company.

Pal farhan: Then if you're a big then you need to also return to the community Big time.

Speaker Change: Other questions. Yes go ahead.

Speaker Change: And the Lady over at the other microphone. Thank you Jarrod and Stephanie class since the BDO investors for sustainable development, we present ATP, we represent 80% of institutional investors with 600 million that's quite a large number.

A S. M is a great example for VB deal over the past years, and I'm going to assume that with the new people onboard ASM is going to continue what it is has been doing.

Speaker Change: Our company is not an isolated object it influences its environment and the environment influences. The company in a company is part of the chain the value chain and cannot be considered and cannot exist without the chain.

Speaker Change: This is the starting point for the analysis.

Speaker Change: When it comes to our risks and.

Speaker Change: Opportunities bio diversity is one of the biggest risks according to VB deal, we would like to compliment ASML with the fact that it's doing many good things for net zero for the climate, but biodiversity has Oh. This is the same attention.

Speaker Change: Critical raw materials are essential in the value chain of E S and they come from mines and processing. These materials has a huge impact on man.

Speaker Change: Environment and community.

Speaker Change: But to what extent.

Speaker Change: Does a S M.

Speaker Change: Measure or include this in the value chain and to what extent is a S. M willing to face those risks and act on those risk or does a S. M.

Speaker Change: Consider this.

Part of the.

Speaker Change: Well, we we do value. It's a poll please can I get.

Speaker Change: These questions to you.

Speaker Change: Well first of all.

Speaker Change: Biodiversity, we drafted a policy we've published this policy so it's very important to us as well.

Speaker Change: I think it's important to also understand the context that we operate in we are a company.

With a low manufacturing number we produce.

Speaker Change: Produce slightly.

Speaker Change: Less than a thousand if we don't have huge buildings huge.

Speaker Change: Factories, so that would have a huge impact on biodiversity in the environment you put those locations and I think the largest part of our impact on biodiversity comes from emissions that take place in the value chain for the benefit of the manufacturing of materials and.

Speaker Change: Our own equipment.

Speaker Change: And we addressed that through our net zero 2035 target.

Speaker Change: So that's what we focus on <unk> and <unk>.

Speaker Change: Indirectly, we contribute to guy diversity and also secondly to know is Benjamin talked about some expansions are amongst which in the U S. One of the things that we did there for the first time is our biodiversity assessment, we had never done that before and the results are.

At our shared with.

Speaker Change: The development company and will be included in the further development of the facility that we are building that self also from that perspective.

Speaker Change: We tried to take into account as much as possible biodiversity.

Speaker Change: Then the critical raw materials.

What is important here is that we have a policy in place.

Speaker Change: So from our suppliers, we expect them to work with our certified refineries and foundries to be able to supply to us. So indirectly we have attention for that as well.

Speaker Change: From a direct perspective, we might not be doing that are sufficiently especially because of overall capacity. So we have a close connection to our tier one suppliers.

So we visit them, we have direct audits with them about further down the supply chain not so much but it has our attention in the future to do it more but through the certification system, we try to achieve.

Speaker Change: That also manufacturing of raw materials that this happens in a environmentally friendly manner.

Speaker Change: Who's next.

Speaker Change: Yeah.

Andrea: My name is Andrea and hopeful for Mega investment management and I have a question on the Dutch tax governance code a S. M. Me has signed this code and I would like to ask whether a semi will fully report.

According to this culture of country by country tax report. Thank you. That's again a question for our CFO.

CFO: Yes. It is correct. We signed this particular code and on almost all accounts we operate in line with this code. So we have a tax strategy we have no.

CFO: Artificial construction to mitigate tax are to evade tax in any way whatsoever paying Texas is an operational commercial activity in the countries that we operate in we really try to really followed the intention of the code while we do not comply with is the country by country.

CFO: Reporting and the reason for that is that.

We try and we Havent found that way yet we tried to strike a balance between transparency, but also not giving away competitive and commercially sensitive information for certain countries.

CFO: We only have one product deposition and in other countries. We have only one big customer. So if we were to report country by country revenue FTE profit before tax et cetera, then basically it provides a lot of competitive information that we do not wish to share. So we really too.

CFO: Why to look into how we can deal with that in the best way possible. We havent found that answer yet we're working on that.

Speaker Change: Any other questions on this item.

Speaker Change: Okay.

Speaker Change: My name is.

Speaker Change: Oh from hunting European investors Phebe.

Phebe: My question is this one a S. M has a market leading position in a L. D. A.

Phebe: If you look at underlying then you were also leading in logic and foundry and memory you wish to expand further.

Phebe: My first question.

Phebe: If you look at recent development in our.

Phebe: By Lab research can you say something about the latest competition developments in logic and foundry and on top of that.

Phebe: In contrast to other bigger players who have less big portfolio.

Phebe: Portfolio and chip tools can you say anything about or to what extent. This is a disadvantage to you. Thank you.

Phebe: Yeah.

Speaker Change: So I mean, I guess I'm being a smaller company are competing against very large competitors you know some of them ICD 10 times our size, but I think if you look at the what we have done over the last four years or last couple of years not just the last four years, we have been able to you know.

Speaker Change: All compete despite our small size and the main reason for that is you know we put a lot of focus on innovation and technology. So if you look at the a O D. As you mentioned there.

Speaker Change: That is something that is now becoming more and more important as we go into the more advanced nodes and we have been able to you know a let's say carve out a fairly significant market share for ourselves compared to our three largest competitors and of course, we do understand that our largest competitors are going to come after us because it's a very attractive.

Speaker Change: Fast growing market.

Speaker Change: We remain confident that given the focus the emphasis that.

Speaker Change: We have on innovation and R&D.

And also the efforts that we have put in to ensure that we work together closely with our customers, we will be able to maintain that kind of market share and in some areas. For example in memory, where we are a smaller player perhaps even to increase our market share. So we are confident of being able to.

Speaker Change: Hold them a whole lot a whole lot of our competitors.

That's helpful.

Speaker Change: Follow up question.

Speaker Change: Yes. So if you look at transition to Mali to what extent is that an advantage for lab research, where they're coming from and looking at the product offering.

So again I won't I won't actually I'll just answer this quickly and then I would actually like my my colleague he Shang ER to ER to be able to add onto that none of the transition tamale opens up an opportunity for us.

He Shang: It's an area, where we were not playing in the POS are in no way of copper in tungsten. So when these transitions to Bali.

He Shang: And they have to do the deposition very much are using LD. It is something which is incremental to the market that we ever be serving but you know maybe you shouldn't be you can also add your comments.

Speaker Change: I think on the question that was asked earlier about sustainability.

Speaker Change: And we actually have developed Molly metal L D to actually reduce energy usage of chips, so by going to Mali, we've actually been able to reduce the resistance of metal, which actually reduces the energy uses of chips, which helps sustainability from that point of view. So we have been.

Being successful in bringing this technology and this is the first time is what the chairman has mentioned this is the first time that we enter the metal L. D market and we entered this market with our with molybdenum and we see that for all devices, a three D NAND DRAM and logic they will use this metal.

Speaker Change: Actually in new era, that's happening right now in metal deposition.

Speaker Change: Thank you Shannon.

Speaker Change: Because if you're doing can we then move on to the next item on the agenda, one more question or two even right.

Speaker Change: We have other opportunities for questions by the way. So just don't Okay. You can hold your horses, if you want.

Bastian: My name is Bastian rock mumps for at value Fendt, a question and.

Bastian: If you look at your targets if you look beyond 'twenty seven.

Bastian: One of your biggest drivers before short form fourth most important product is a L D.

Bastian: And you you benefit from the increasing number of layers in the leading edge foundry breeder.

Bastian: Prediction.

Bastian: If you look at the penetration at the moment of ILD in the in the leading edge foundry production.

Bastian: How big is that now and how far can it.

Bastian: Cannot keep on increasing.

Speaker Change: That's my question.

Speaker Change: Ah Buster and I think this is a you know we we will not address this directly because there will be a competitive information. So what we have always said is if you look at our overall market share. It is at least 55% Disney as logic and foundry combined with memory now our hour.

Speaker Change: Market share in logic and foundry are substantially higher because we have a smaller market share in a in a memory. So I think you know if you look at our you know what will happen there as far as the first of all the transition to get all of them, that's going to add more layers in terms of logic and foundry.

Speaker Change: The applications, but at the same time memory is also advancing and will require memorial delays. So as far as we are projecting a reading that you know the additional layers and coupled with a certain amount of investment in the 27, that's going to lead us to that four to 5 billion.

Speaker Change: You know so any kind of target that we have set for ourselves and are based on current view unless there's something that changes dramatically. We are actually confident that we will get there.

Speaker Change: One small follow up maybe if you look beyond the 27 do you see this trend continuing with more.

Speaker Change: Layers and for a L D.

Speaker Change: Thank you have a you know that's that's not all of you, but if you just look at what's going to happen as far as the technology Road map is concerned so beyond 2027.

Speaker Change: All around will come in the other let's say variations. For example are you know at the end of the decade, maybe you might see see fab, which is one on top of the other and all of those are all just going to add to even more LD layers, so without giving any kind of projection because that should probably come in the next investor day, we think that.

Speaker Change: The growth in terms of layers as the technology becomes more and more advanced that will continue.

Speaker Change: Thank you.

Speaker Change: It's a wholesale haynesville for classroom.

Speaker Change: MS Klassen, our one for you and then I propose that we move to items three and four thank you chair Stephanie class N V D L. A.

Bold wage was already a topic in presentation livable wage.

Stephanie Klassen: It's not a topic for own employees, but obviously down further down in the supply chain. You have said that you were waiting for the results of an initiative for livable wage what are you waiting for in which steps. It's Asia I'm then going to take.

Stephanie Klassen: Again, you know sensor 2021 we have been advocates of living Bates with D. A.

Stephanie Klassen: <unk> business Alliance.

Stephanie Klassen: And I think that has finally taken shape what they have done is they have created a living wage possibles.

Stephanie Klassen: And of course, we give our inputs into what should be the guidelines of what should be in their guidelines, which they are going.

Stephanie Klassen: Going to would you say are preparing and hopefully publishing soon so one of the things that we are waiting for is to look at exactly what will be in their guidelines I mean, we provide input, but we don't via the guideline. So once that is all we're going to use that as the basis of not just as you correctly mentioned Stephanie not just for you.

Stephanie Klassen: Internal purpose, but also how can we use that guideline to work together with our suppliers I think that's important because you are absolutely correct living wage is not just in the SMB issue. It's also in the value chain and specifically our supplies.

And then also fall for now I'm looking at supply chain, yes, exactly so predominantly in the supply chain yes.

Speaker Change: Okay for the sake of time, let's move on to items, three and four on the agenda, which means first voting block three and four and after item four I will give you again the opportunity to ask questions on both agenda items and also to KPMG that will make a presentation in a moment.

Speaker Change: Agenda item three beat but fish.

Speaker Change: Yes. This is the notary I now get the final number of registered shares.

Speaker Change: That has a voting right in this meeting and that number is.

Speaker Change: A 38 million further in 'twenty 1463.

Correct.

Speaker Change: Okay. The next item is a three which is a.

Speaker Change: Voting item with three shop items. So three a remuneration report 2023 and overview of the implementation of the remuneration policy can be found in the remuneration report included in the annual report 2023. These can be found on pages 153 to $1 66 of the annual.

Speaker Change: Report 2023 as also mentioned in the agenda.

Speaker Change: And we have an explanation.

Speaker Change: And by the chair of the MSR Committee, Mr. Languish D Jay over to you.

Speaker Change: Thank you Mrs too. Thank you. Thanks, again, ladies and gentlemen, I will now take you through the highlights of the remuneration report for 2023.

Speaker Change: I mean, she's a minimal already indicated. This report is included clean included in his entire T. E. In is Sim 'twenty two 'twenty three annual report from page 153, two pitch 166 of course, he and I will just give you a few highlights, but if you need more.

Speaker Change: As you can read through to the full report.

Speaker Change: This report fully complies with the Dutch Civil code.

Speaker Change: The principal are set out in the Dutch corporate governance code.

Speaker Change: In accordance with the Dutch Civil code, we ask you the general meeting to cast an advisory vote on the remuneration report to 'twenty to 'twenty three.

Speaker Change: Allow me to remind you that the current remuneration policy for the management Board on which the remuneration report for 2023 is based was adopted the bodies of general meeting on May 15 2023.

Speaker Change: Lets look through the various elements of the remuneration report on the base salary first in 'twenty three.

Speaker Change: The base salary of Mr. Measurement rule, our CEO has been increased by 10% justify of course by the excellent performance, which has been illustrated before.

Speaker Change: Generally in line with the market movement that we've seen in the Netherlands, following a period of inflation as well as generally in line with the average increase for E. S M employees.

Speaker Change: In the Netherlands.

Speaker Change: This did bring his annual base salary from around 671 in Q2 738 cube.

Speaker Change: As far as Mr. Wagner and our CFO base salary is concerned the increase has been by 5% in 'twenty to 'twenty, three which did bring his base salary from around 530, 8-K, you who seek to 565 kill you.

Speaker Change: And the base salary of Mr. Evesham insider as CTO has also been increased with 5% in 'twenty three which brought these base for 600 key U S. Dollar to 630 key U S dollar.

Speaker Change: Now, let's take a closer look at our variable compensation is a very valuable remuneration elements of the premix.

Speaker Change: Namely the short term cash yearly incentive and the long term share incentive which is as you know delivered.

Speaker Change: And there was a form of performance here.

Speaker Change: As far as yes, Ti short term caching send TV consumed the payout level is based on one hand on the achievement of financial targets.

Speaker Change: Each have a weight of 75% of the nominal total.

Speaker Change: And on the other hand on 25% nonfinancial targets.

Speaker Change: These nonfinancial targets, all ESG related and strategy read it.

All targets are set annually by supervisory board.

Speaker Change: Yesterday I target as percentage of annual base salary is set at a 125% for the CEO, Mr. Lou and at 80% target level for the CFO, Mr. Avi, Oregon as well as for the city you Mr. I'm Sad.

Speaker Change: The maximum attainable level is under an 87, 5% of base salary.

Speaker Change: Of this salary salary for the CEO and the 120% of base salary for both the CFO undersea to you.

Speaker Change: It will of course not be a surprise to you that given the strong performance year that we ever recorded in 'twenty three for E. S. M. All management Board members have shown an over achievement on four out of the six pre defined as tier targets.

Two nonfinancial targets have been realized on target or slightly below targets.

Speaker Change: I wanted to see also the district Advisory Board did apply downward adjustments of the overall outcome on the nonfinancial targets based upon their assessment of the realization of our critical nonfinancial targets.

Speaker Change: The total outcomes Tito resulted in an overall over achievements of 137% of target payments for all three management Board members.

Speaker Change: Last but not least the long term share incentive program, which as I said before is performance based I mean, yes. He is performance based and paid in shares.

Speaker Change: He says you know a multiyear valuable payments, which is delivered via performance shares which become unconditional.

Speaker Change: After a period of three years over which the performance is measured.

Speaker Change: And which are subject to a two years all being period B. After this period of three years. So in total five years.

The unconditional award is a result of the realization of the following two targets.

Speaker Change: First of all revenue growth.

Speaker Change: Which is measured vis vis the market and the market performance is trucked vis vis vis who's a public indicator.

Speaker Change: And second second kept the average EBIT versus a preset object to you which is determined by the supervisory board.

Speaker Change: Based on the achievement of the performance criteria and 2023.

Speaker Change: Vesting for 2021 the grants in 'twenty 'twenty four is.

Speaker Change: <unk> hundred and 35% for both to see you.

Speaker Change: And for the CFO Corie.

Speaker Change: Corresponding for the CEO to 500 786, excuse me 5786 shares.

Speaker Change: And for this year for 20 915 shares.

Speaker Change: There was no vesting of performance share for the CTO given these date of appointment and the applicable three years vesting period.

Speaker Change: Furthermore.

Speaker Change: Following the amount of shares conditional to performance.

Again as measured over the coming three years.

Speaker Change: I've been granted to the three management board members in 'twenty three.

Speaker Change: One targeted value with it.

Three years vesting period, ending in 2007.

Speaker Change: And in line with our remuneration policy.

In terms of members Mr. Lou feel at that time received at 40 54, four I'm, sorry, 4052 shares representing roughly one 3 million Yahoo.

Speaker Change: Mr. Javier again received 20 580 shares represent.

Speaker Change: Representing 84.

Speaker Change: Hey.

Speaker Change: 847, K you sorry for my hesitation and Mr. I'm sorry, the city you received 8039 shares representing roughly 2 million 600057 shares.

It has to be mentioned that as of the 2020 feet Grant.

Speaker Change: Local or related I'm, sorry relative total shareholder return, which is a performance indicator measuring the return to the shareholders as compared to a basket of comparable company. This indicator has been added to the two already existing performance measures.

Speaker Change: This third measure is set up as a modifier of a multiplier that can impact positively or negatively the total achievements.

Speaker Change: By plus 35%, if we are measuring and over achievements and negatively by minus 35%. Each in three years from now we record them under achievements.

Speaker Change: Last but not least I will I would like to give you some color on the so called CEO pay ratio as you know is the ratio of this your remuneration and the average remuneration of all of those are employees is calculated in trucks.

Speaker Change: Called the payer issue by dividing the Ceo's remuneration by the average remuneration of all employees.

Speaker Change: Yes M CEO pay ratio is relatively stable.

Speaker Change: Moving from 27 in 'twenty two to 31 in 'twenty three.

Speaker Change: I want also to mention that this ratio is rather at the low end.

Of the range when you compare to other comparable E R.

Speaker Change: Listed companies.

And with that I would like to turn back the microphone to you Mrs.

Speaker Change: This is to you.

Thank you D V for me Sir for this presentation.

Speaker Change: Uh Huh Intermune.

Speaker Change: I'll kind of half one.

Ladies and gentlemen, I would like to inform you that the general meeting although I felt in this are in line with article two.

Speaker Change: One.

135 should be a paragraph two of these are just two of codes and this will be and it's I think voting.

Speaker Change: I can then this adoption of yeah, and you reported 23. The annual report has been there and check and well all the kids as a proof by taking he and I would like to give the floor to a kick and key to that is an explanation.

Speaker Change: And to comment on the answer.

Speaker Change: Statements.

KPMG: Oh good afternoon. My name is kind of cross that finish line and on the external auditors KPMG responsible for the audit of these nice taken himself S. M.

KPMG: This is my fourth year.

Speaker Change: As a responsible partner off kicking he and take it and he is now the honest of Ace and priority and I guess I would like to take this opportunity to give you further explanation of our audit of M. S amps financial statements for the attention ninety-three.

Speaker Change: But before I do so.

Speaker Change: I would first like to say a few words about the complete research into the yeah.

Speaker Change: Yeah.

Speaker Change: Answers to questions from mandatory tests.

Speaker Change: And this results from settlement with the U S regulator I deeply regret that be showing off the answers well safe to take place within our organization. This shouldn't have happened.

Speaker Change: I apologize for this on behalf of the company at myself Huh.

Speaker Change: We have properly investigated the coffees.

Speaker Change: And has taken several measures based on this to prevent this from happening in the future.

Speaker Change: Shareholders I would like to confirm that a person he was not involved.

Speaker Change: This also applies to all five other audit I T and his key partners involved in the audit.

Speaker Change: In Q2, that's regulations.

Speaker Change: C. G D var privacy, Ruth I cannot say anything about the outcome of the investigation regarding the other team members taking he.

Speaker Change: Hassan sanction to everyone involved.

Speaker Change: Hum.

Speaker Change: Left kagan. She since then kicking G has also taken remedial measures based on the investigation, including actively monitoring the correctness of tests as well as re testing of individuals involved.

Speaker Change: We have a very robust quality system, including evaluating audit work in the audit team.

Speaker Change: Listen this fact and the experience and quality of our team I fully supports the quality of the work performed.

Speaker Change: And about.

Speaker Change: Our audit opinion.

Speaker Change: Housing sector so I.

Speaker Change: I would now like to talk about the ticket twenty-three audits of S. M.

Speaker Change: This presentation, followed us structure of our statement as included on pages $90 59 to 266 of the annual report.

Speaker Change: Next slide.

Speaker Change: Our opinions now.

Speaker Change: On the first of March 'twenty 'twenty, four we issued an unqualified audit opinion.

Speaker Change: And in brief this means that the financial statements.

Speaker Change: He sent a true in fact here.

Speaker Change: Without any material that mistakes.

Speaker Change: So the annual report.

Speaker Change: Hey, Eric.

Speaker Change: Clear and fast view of the situation then the audited anti issued an unqualified opinion on the nonfinancial.

Speaker Change: All sectors.

Speaker Change: And this is what he he only pages to 51 two to one to 63 of the annual report firsthand materiality any planning files. When you take into account what is known as much reality and briefly consider something to be material is the extent of MS statements is such that.

Speaker Change: <unk> recently effects here.

Speaker Change: Decisions as users of the financial statements.

Speaker Change: Oh Wow.

Speaker Change: A majority of it.

Speaker Change: 33 million euros have been used for the audit of S. M. Stefan Schulz statements, which is four points to 87% of the pretax income normalized mainly 40 universal of a previous write down of is tricky.

Speaker Change: Oh identify discrepancies above one 465 million tourists to management and to the supervisory board.

Now the risk analysis, we conduct our audience using a risk analysis the focus on those areas, where the risk of Orissa that is intentional.

Speaker Change: Now our intentional there.

Speaker Change: Ara C.

Speaker Change: Or misstatements is the biggest enhancer statements in our risk assessment exactly included fraud risk, Texas related to farm financing reporting it in proper preparation of assets.

Speaker Change: The risks.

Speaker Change: To I T and some security and then the noncompliance with laws and regulations, including trade restrictions.

Speaker Change: Then the internal controls.

Speaker Change: Control environment, including culture and design.

Speaker Change: And also clients related risks and contingency risks.

Speaker Change: We discussed that such risks and you're on the team so that they can remain alert to new insights and developments.

Speaker Change: Together with our specialists such as <unk> auditors climate and forensic specialists, we evaluate all of these sectors indicate the risk of a material misstatement.

Speaker Change: Yeah.

Speaker Change: What is our audits.

Speaker Change: Approach.

Speaker Change: Pardon me for instance of efficiency to choose which activities, we performed essentially and Fitch Martin Luckily because of the setup of the financial organization and the shared service center presence in Singapore.

Speaker Change: We plan and execute an almost complete central audits, which resulted in the fact that we perform detailed audit work on 91% of all assets and 85% of the total revenue.

Speaker Change: This means that we do central audit work.

Speaker Change: The main operations in Japan, Korea, the Netherlands, Singapore and the Americas.

Speaker Change: I mean, the separations that primarily through the audit work at the shared service center as well as using work performed by local KPMG auditors.

Speaker Change: In addition, let me use the engagement of the non KPMG auditors of S. M. P T.

Speaker Change: That's part of our audit work on the item investment in social.

Speaker Change: We are a huge.

Speaker Change: Online the recorded work all of the relevant local I'll, just say Hong Kong for the auditor of EE and BT and they shouldn't we had several calls and virtual meetings and discuss their local or that approach as long as identified significant risks.

Speaker Change: This year. They also physically visited the operations and where applicable the local all the teams in Singapore, Italy and Korea.

Speaker Change: Oh local auditors, who performed work for the audit of the consolidated financial statements.

Speaker Change: For that work.

In accordance with our inspections and under our supervision.

Speaker Change: Next slide please.

So now for instance, compliance with laws and regulations, specifically with respect to fraud, and noncompliance with laws and regulations. They performed several specific activities.

Speaker Change: A summary of these can be found in the audit report on pages 61 to 62 and $2 63.

Speaker Change: Internal control now in the audit I mean look at the quality of internal control at ethnicity organizations.

Speaker Change: Just on the question of whether and which in turn the control isn't relevant to us and so I don't even make use of it Jeremy the audit and tour.

Speaker Change: Control risks in March.

Speaker Change: It is therefore, not a matter of expressing an opinion on the effectiveness of internal controls as a help the nature and scope of the identified opportunities for improvement unlimited anti mainly in processing preference enter our documentation of internal controls.

Speaker Change: Then he worked on the I T and information security for our audits the considering the risks of material misstatements due to cyber risks.

Speaker Change: I took note of what S. M has thrown up came through cyber security as long as no kids any saga incidents.

And we.

Speaker Change: Well, we enforced our I T specialists.

Speaker Change: So performed work I mentioned process regarding backup and recovery procedures.

Speaker Change: And from this virtually concluded.

Speaker Change: That there were no findings that had a material impact on the financial statements and our our audit approach.

Speaker Change: Then climate risks.

Speaker Change: Management has.

Speaker Change: I'll say that the impact of climate on business operations as part of its strategy and internal controls you have been able to read more about this in the transaction of the annual report.

Speaker Change: He asked determinant.

Speaker Change: They recognize the risks could also have a potential material impact on the financial statements.

Speaker Change: Based on the work they performed they have determined that climate related risks do without a material impact on the financial statements, including an evaluation of fixed assets.

Finally, the key points of our audit.

Speaker Change: That's also included in our statement of pages down 63, and 264 is identified two key issues. This year are consistent with prior year. He has identified a key issue related to recognition.

Speaker Change: And this is due to the financial impact and is nationally.

Speaker Change: Uh huh.

Speaker Change: And a specific situation related to delineation risk includes the assumed fraud risks that management Liberty fails to fully account for revenue. Secondly, also consistent with prior year. He has identified a key issue related to capitalizing development costs is included this as a key issue considering this and they came back and.

Speaker Change: He estimates involved as well as see the complexity related to estimating to what extent.

Specific criteria unmatched to capitalized development costs.

Speaker Change: No.

Speaker Change: We have no particular teeth in these two key points.

Speaker Change: The 'twenty to 'twenty two.

He item regarding the purchase of LTE and devaluation in the allocation of the estimate estimated value Tinder U S. It is no longer applicable this year as it related to the specific circulation intense 822.

Speaker Change: After all the other test sensitivity for we are currently preparing this anti they'll they discuss it there briefly.

Speaker Change: The audit committee expecting approach and scope to be in line with last year.

Speaker Change: So this is my presentation. Thank you for your attention and confidence and of course I'm ready to answer any questions. You may have missed the SGR I would like to hand, the floor back to you. Thank you Mr. Yang.

Speaker Change: Yeah.

Speaker Change: Excellent.

Speaker Change: So gather the points there.

Speaker Change: C C and first of all this is the profile for a different purpose and there's a proposal for it.

Mr. Yang: Second off to find 75 USA.

Mr. Yang: For each ordinary share is higher than he didn't take out for 2032.

Mr. Yang: Rich Ross and then kill point 50 U S.

Mr. Yang: One said the clarity different until be made available on 22 may 2024.

Mr. Yang: So that won't be the payment dates for the different.

Mr. Yang: As the next item I'll get you the opportunity to ask questions about I can three.

First of all I had.

Mr. Yang: For the discharge and this consists of two voting items.

Mr. Yang: First of all start with Sandy wants management, well that in accordance with article 34 of the articles of association. It is proposed to the general meeting that the minutes of the parts management be discharge of liability for any policy pursuit by them and taking the three M.

Mr. Yang: Insofar as the policy is evident from the 10 to 23 <unk> financial statements.

Mr. Yang: And have all of that then I can foggy constancia discharge of the I'm slightly surprised he bought it they sell St corners in article 13 paragraph four of the Artisan Association. It is proposed to.

Mr. Yang: The general meeting that the months of the surprise support be discharged from liability for the exercise of the submission of the policies pursued by the U.

Mr. Yang: That's a fresh bonds in fiscal year, 'twenty, three and now I'll give you the floor.

Mr. Yang: Now you'll have the opportunity to ask questions about agenda items, three and four that is taken off the oh.

Alterra: Alterra answered then.

Speaker Change: I can 40 this tragedy.

Speaker Change: I represent he had T cell, our investor a cessation Navy.

Well I can say that.

Speaker Change: The cash that the company wants to have in the past as fans of million now. It has increased there have been increased to $600 million.

Speaker Change: It has already increased to six 7 million.

Speaker Change: As if nothing happens this year daily $850 million, but if you look at the minimum of cash you have to look at the developments of <unk>.

Speaker Change: S M that so much of duty.

Speaker Change: I still expect there.

Speaker Change: In terms of Ah Ah Cassia can you expect more of that.

Speaker Change: And buybacks or do you think that the dividends can be increased this is there a logic question I will take the other question that I saw in the room.

Speaker Change: And well maybe Paul you can answer this question about he ketchup assertion that they'll slip also buyback of shares now Hello.

Unknown Executive: I'm representing value fund I'm, a long term investor synthetic and I'm very satisfied.

Paul Farrell: Yeah.

Unknown Executive: First of all the many thanks for the last four years. It was amazing great achievement to this great company. Thank you very much.

Unknown Executive: And of course each of them are good.

Speaker Change: Good luck for the future and.

Speaker Change: For the 2027 targets of 5 billion euros sales is quite amazing.

Speaker Change: First question about the evaluation tools are at the balance sheet is in 2023. It was a record high 80 billion euros. So my question is what is the amount of the percentage of that amount of 80 million euros is for the next generation.

1.4 nanometer gate all around.

Speaker Change: And my second question is about the Richardson development cost.

Speaker Change: Capitalization of the development cost if you look at the last couple of years. It was in the low turkeys. If you look at the percentage of the gross R&D amount.

Speaker Change: This water in 2024, it was above 40%.

Speaker Change: Do you expect for the coming years to go many things.

Speaker Change: Hardly degradation.

Speaker Change: Many thanks for these questions Jim perhaps you couldn't do that first of all due to the cash buffer question and perhaps you can take the other question around the gate all around in the R&D capitalization.

Unknown Executive: This is Paul.

Unknown Executive: Exxon they launch.

Unknown Executive: I will answer in Dutch so indeed, we have a capital allocation policy and priority one is focusing growth internal growth. So that's capital investment in R&D and.

Unknown Executive: Mne opportunist, so that's priority one.

Unknown Executive: Two is a strong balance sheet and that's where the 600 million comes from showing our midterm guidance until 2027, we've said.

Unknown Executive: That these targets will be kept so around the 600 million, we do not have an update on that despite the fact that that was further growth from 3.0 to three six.

Unknown Executive: So we left that 600.

Unknown Executive: It is a question whether it will be raised in the future and we will report on that in the future. If this changes.

Unknown Executive: During one of the Investor days.

Speaker Change: And a final remark I think this year, we increased dividend by 10% amongst others for reasons that you yourself indicated and we also increased shy share buyback to $150 million. So there is.

Speaker Change: And upward movement, if you will.

Speaker Change: Based on this strong cash performance, we had in 2023.

Speaker Change: Yeah.

Speaker Change: And maybe you can say something about that R&D capitalization and development cost. Yes. If you look back on the past few years than nine out of 10 times they know that.

Speaker Change: Waters, where 35% to 40% of the gross development.

Speaker Change: Spendings that we do they are capitalized.

Speaker Change: There can be an outlier slightly more slightly less.

Speaker Change: Depending on the focus on that particular year or quarter, but most years or for one whole year, you end at the 35% to 40% and I don't see that changing when it comes to amortization of costs are you.

Speaker Change: You will see them increase from Q2 compared to the past because of a number of products that were recently remember developed for gate all around.

Speaker Change: Are now transitioning into mass production and therefore, we will start RMR gestation of that capitalized development cost is that sufficient or do you need more explanation.

Speaker Change: Evaluation costs.

Speaker Change: Oh evaluation tools Asia, Mr or anything you can say about that.

Speaker Change: Nexgen gateway around evaluation tools for our next generation of gate all around.

Speaker Change: With Gittler own the generation right now is two nanometer and the next generation would be 1.4, it's going to take maybe three to four years to achieve that so right now we're actually in the first stages of working with our customers on the evolution tools for 1.4 nanometer.

Speaker Change: As you know that okay, we already are.

Speaker Change: Present in L D.

Speaker Change: And we expect that they evaluate our evaluation tools for the next generation gates around going to be us.

Speaker Change: Good or maybe even higher than for the next generation.

Yeah on the lack of discipline and the other questions on these items.

Speaker Change: If not then it's time to vote on the first floating blocking in the audience you can vote using the voting device and you can now vote by selecting your choice. So you can push the buttons, one two and three corresponding to the choices one four against two and <unk>.

Speaker Change: <unk> three and the last choice made counts and we have some light.

Speaker Change: Let's start with item three a remuneration report 2023 and I now open the vote.

Speaker Change: Just a few seconds left.

Speaker Change: Your choice.

Speaker Change: And I hereby close the vote.

Speaker Change: Then we proceed by voting on three adoption of the annual accounts I now open the vote.

Speaker Change: A few seconds left.

Speaker Change: Vote is closed then we will now proceed to the vote on <unk>.

Speaker Change: Mm three C adoption of dividend proposal I open the vote.

Speaker Change: A couple of seconds left.

Speaker Change: Vote is closed then item for a discharge of the members of the executive Board and I open the vote.

Speaker Change: A couple of seconds.

Speaker Change: Yeah.

Speaker Change: The voting is closed and then finally you can cast your vote on item four b discharge of the members of supervisory Board and I now open the vote.

Speaker Change: A few seconds left.

Speaker Change: And I hereby close the voting. So this concludes the first voting bloc I hereby close the voting for this voting block. The voting results. They are about to see include the vote cast by proxy and the votes cast in the room today the voting results can be seen.

Right here in front of Us and I conclude that all proposals have been adopted with a large majority.

Speaker Change: And many things for that we now move to the second routing block items five and six we will first discuss these fares.

Speaker Change: First and after the end of I item six you will have the opportunity to ask questions again then.

Speaker Change: Item five remuneration of the supervisory board consists of two voting items Hello first explain briefly in Dutch what these items and then give the floor to my colleague DDA languished for a detailed explanation.

Speaker Change: Five a proposal to amend the remuneration policy for the supervisory board.

I'm, sorry, the new remuneration policy for the supervisory board and the <unk>.

DDA: Proposed policy was posted on the website and I refer to that and it was created and came about after dialogues with stakeholders and is presented to the general meeting on the recommendation of the supervisory Board and also on the recommendation of the and as a committee within it and then five b is that changed it.

DDA: The remuneration of the members of the supervisory board and its committees and in the dialogue with stakeholders.

DDA: It was also a just discussed an adjustment of the remuneration of the members of the supervisory board and it is.

DDA: Proposed by the board to make certain changes to the remuneration is set out in the agenda and the agenda item five b with retroactive effect from January 1st 2024, and empty meeting does not vote in favor of this item. The current remuneration will continue to apply the Jay can.

Speaker Change: You go ahead gena items, five and five b. Thank you.

Speaker Change: Thank you Mrs to absolutely, let's move now to.

Speaker Change: If you're okay to the proposed adjustment to Dear Supervisory board remuneration policy.

Speaker Change: As we know the current remuneration policy for the Supervisory Board was adopted by the general meeting as of May 16, 22.

Speaker Change: It is proposed by the supervisory board to update his policy for the supervisory Board.

Speaker Change: <unk>, which we will which will be then applicable for the next four years in view of a couple of considerations first of all.

Speaker Change: Given the fast evolution of our ASM the company needs to ensure it's competitive ability to attract I caliber supervisory board members with broad skill sets and broad background in these very high growth environment.

Speaker Change: Furthermore, the nature of the role as significantly changed over the last couple of years, we've an increase complexity and increased size for the company and increased visibility for our company.

Speaker Change: I would like just to remind that four years ago is market cap grew.

Speaker Change: <unk> when it entered the Ericsson that grew from 5 billion. Initially 5 billion Euro to now close to 30 billion Euro which is positioning is sim.

Speaker Change: And off of the <unk> index.

Speaker Change: In addition to this evolution.

Speaker Change: We have performed very recently you benchmark helps to buy are conducted I will say by your wheelie Stillwell's Watson, which is an executive well known reward consultants.

Speaker Change: And these benchmark.

Speaker Change: This was primarily based upon a Dutch AIA expire group comparable to your Sim in the sense that we considered only two tier border companies since we want to compare with the similar structured company in term of corporate governance.

Speaker Change: On the following slide.

Speaker Change: You will see first domain proposed policy change concerning the following items first we are proposing to remove the cap on the travel allowances, which is currently set at 10000 European Euro for Continental travel in 'twenty. So then your pure for Intercontinental.

Speaker Change: Travel.

Speaker Change: Second we would like to introduce in order to give flexibility for the board to manage unplanned events.

Speaker Change: We would like to introduce a fee of 2500 Europa additional meeting in excess of two hours above the regular cadence of the supervisory board or its committee in case of special business circumstances, and after a prior approval by the chair of the Supervisory Board.

Speaker Change:

Speaker Change: We would like also first to introduce the option to establish other committees, depending on the need of the company and in particular potentially with Technology Committee.

Speaker Change: In addition, the proposal has been submitted to the general meeting to increase the fees for the supervisory Board member and its committees.

Speaker Change: ASM is engaged on this topic with a significant number of our top shareholders and key investors back in February as with as well as proxy advisers and we received a positive feedback to move forward with these adjustments of the supervisory board remuneration policy and subsequent feet sits.

Speaker Change: Sure.

Speaker Change: Finally.

Speaker Change: And that's illustrated on the chart, which is shown in front of you based upon the benchmarking again, which as I said before has been conducted by released the worse Watson and taking into account that the fees for several position are today at the lowest quartile or even below below versus.

Speaker Change: As a reference group the following adjustments, which you see here are proposed and detailed in the table, which is depicted on the screen I will not comment or numbers, but they will let you just look in this table you have the current Ah.

Speaker Change: Fees, which is awarded by positioning the board being chair or being a committee members.

Speaker Change: On the middle of the charts on the Blue on the Blue part of the charts you have D. A benchmark that we have recorded the media and the 25th percentile of the 75 percentile and on the right hand side. We have a proposal that we are putting forward for your vote.

Speaker Change: The supervisory board I, let you a few minutes to two two to read the members the supervisory bodies asking you to cast your votes on this new policy.

Speaker Change: Which would then be the leader for the next four years absent of any new extraordinary event.

Speaker Change: And this will close.

Speaker Change: My presentation of all have inhibition elements. If you allow me I would like just to conclude them.

Speaker Change: Ghansham I'll use that he's leaving us today or this year, but there is another person who is leaving US is Mr. Stefan <unk> who's sitting on these on these tables the fun.

Speaker Change: Isn't still until today head of global he world. He helped me the board and the committee allot to prepare the old Shaw with investors to convince the investors to prepare this AGM for many years and I would like to thank you Stefan and I learned a lot from you.

Speaker Change: You did a lot to this company and to the management team and I would like to wish you a very happy wise and quiet Mcgwire and then through the retirement. Thank you Stefan.

Speaker Change #100: [noise]. Thank you for your kind words to Stefan which I wholeheartedly Echo.

Speaker Change #100: Now how newsletter method, let's continue now with item six composition of the supervisory Board and this item consists of three agenda items all of which can be felt it on that first six a the proposal to reappoint Mr. Reappoint, Mr. Languish as a member of the Supervisory Board a DTA was appointed for a term of four.

Speaker Change #100: He is on May 18, 2020, and his term therefore expires at the end of this general meeting.

Speaker Change #100: The supervisory board proposes on the recommendation of MSR to reappoint DJ for an additional period of four years, which period will end at the end of the annual general meeting in 2028.

Speaker Change #100: Therefore, the supervisory board has prepared and binding nomination to reappoint him.

Speaker Change #100: His name is current additional position in Korea and described in the agenda.

Speaker Change #100: And then we move to the next two items on the agenda. The proposal to appoint Tania Micki and Martinsville and bring as members of the supervisory board are both present today and they will introduce themselves to you in a moment. The supervisory board has prepared a binding nomination for the appointment of Italian Martinez members of Supervisory Board if you vote in favor both.

Speaker Change #100: We will take effect today and will be for a term of four years, which will end at the end of the annual general meeting in 2028.

Speaker Change #100: The supervisory board is pleased to nominate them today and is confident that they will both be very valuable additions to the supervisory board.

Speaker Change #100: And Tanya.

Speaker Change #100: Was CFO since 2020 and also.

Tanya: Take Ams Board member and also with Echo allowance elder Lasalle with her wealth of financial experience. She has a financial expert also referred to in the corporate governance code I'd like to give the floor to Tanya so that she can briefly introduce herself.

Tanya Lasalle: Yeah go ahead.

Tanya Lasalle: Couponing.

Tanya Lasalle: Good afternoon, ladies and gentlemen, my.

Tania Micki: My name is Tania Micki and it is my honor to be here today.

Tania Micki: D elected on the supervisory board of ASM.

My professional carrier in the last 25 years has covered all aspects of the finance functions such as M&A SG&A finance transformation tax Treasury reality indifferent industries from F. N T. G. Do you have the equipment.

Tania Micki: Manufacturing I'm currently two groups here for chicken ethylene mentioned and Med Tech company listed on the six and the chair of the audit Committee at each L. A leading business school in Switzerland.

Tania Micki: In these two rooms and deeply passionate about leveraging my experience and financial acumen to surf purpose led companies.

Tania Micki: A chicken we are scaling health care innovation to improve People's lives, which is very much in line with what ASM wants to do and empowering next generation through education at THL.

Tania Micki: Similarly, my motivation to join DSM Supervisory board stems from my belief in the transformative power of technology and innovation.

Tania Micki: I believe that ASM stands at the forefront of technological advancement.

Tania Micki: And then allow us to drive progress across different sectors. It is a fast fast paced environment, where innovation is essential for growth and there's nothing more important for me than being at the heart of such innovation driven ecosystems.

Tania Micki: I'm very much looking forward to everything the strategic direction of the company, ensuring highest standards of corporate governance and ethics.

Tania Micki: And safeguarding the interests of shareholders employees and other stakeholders together with the supervisory board.

Speaker Change #104: I'm very proud and honored to join the supervisory board of DSM and I would like to thank once more.

Speaker Change #105: Provisory born in U S shareholders for your trust. Thank you. Thank you Tanya.

Speaker Change #106: And welcome to the S M.

Speaker Change #106: And its herself.

Speaker Change #106: And then the proposal to appoint Mr from them drink as a member of Supervisory Board and I think Martin in this room needs. No introduction. He has been involved with ASML from the very beginning and has contributed immensely to ASML success in recent years as President and C. T O.

Speaker Change #106: It's widely praised for its technological knowledge and experience.

Speaker Change #106: Supervisory board plans to establish aftermarket appointment technology Committee of which obviously Martin will be the chance and this committee will be sparring partner for the executive Board and assist the supervisory board in identifying and assessing our market developments in the field of technology.

Speaker Change #106: We have to assess all of that.

Speaker Change #106: And how we can do that in the best way possible. Obviously, so also here again I would like now to give the floor to Marty for a brief introduction.

Marty: Good afternoon.

Martin: My name is Martin frozen drink.

Marty: And.

Marty: I'm also honored.

Martin: To be nominated and become a member of the supervisory board of ASML.

Martin: ASML.

Martin: You can do that three times, but then you will be punished all I don't think I'll manage.

Martin: Okay. So I worked Ah.

Martin: I a longtime at ASML. So this morning, when I arrived I was I did it.

Martin: My second job throughout.

Martin: Throughout my career, but to be honest at the time that I started out with ASML for.

Martin: For 50% it was in the hand of SMA a S. M. My eye. So you could argue I'm only half.

Martin: Transitioning.

Martin: Right I'm very motivated.

Martin: Why because of the historical context, the success of ASML.

Martin: 40 years, and I think ASM played a very important part so the historical contact but also.

Martin: Context, but more importantly, as well bye.

Martin: As Pauline said the by setting up the technology Committee and I have experience with that with ASML.

Martin: And do you know from meta management perspective, but you know many positive experiences and I've seen.

Martin: That I in this way can contribute to the further rolling out of the air of ASM.

Martin: It's my strategy.

Martin: And looking at the years to come.

Martin:

Martin: I believe.

That I know the roadmap of the customer and from that perspective, I realize that the role of new materials and depositions and.

Martin: Hisham says that it will become more and more important.

Martin: So also for the future I think we can make a huge difference by having the right strategy and I would like to thank you for placing their trust in me.

Speaker Change #109: And I think that is what I have to say.

Speaker Change #110: Many thanks, Martin and a warm welcome to you we're very happy to have you on board for this grade club.

Speaker Change #111: Now then I would like to give the audience the opportunity to ask questions if any on items five and six.

Yes go ahead.

Speaker Change #111: Eric some hanging in on behalf of H E. B, well I don't think that Oh, we surprise you by saying that we're very happy that a S. M can use Martin fallen very weak and I think you as chair and had a great role in convincing Martin two questions.

Speaker Change #111: First of all I am curious if you look at the developments in the field of lithography.

Speaker Change #111: Things are becoming more prominent.

Speaker Change #111: To what extent.

Speaker Change #111: The coming of Martin Sunlen break could be a competitive advantage.

Speaker Change #111: You know now that Alds will come in gradually more important second question is maybe not really fair, but Martin becomes sparring partner for management, but also a supervisory board member. So how is he going to separate these two identities. Thank you.

Speaker Change #112: Your question I think that the first we are very pleased to have a macro vendor break.

Speaker Change #112: Joint join S. M. I think it's very important that this technology the growth of the technology of the future needs are both materials and lithography and his knowledge about the customer and technology would also be helpful to us we think that the the.

Speaker Change #112: The growth of our.

Speaker Change #112: Technology in the future resides a lot on new materials and also on how to integrate those new materials with the patterning films and so on and I think his knowledge of the lithography part of our of patterning would be helpful to for us to develop new materials going forward.

Speaker Change #112: Thank you Thank you announced.

Financings on the on the other half of who calls regarding the other question you know how can you separate your role being on the supervisory board and an advisor to the management well I think it applies to all of US as Supervisors I think this is the big question you know being effective as the supervisor. One day you are an adviser to the management.

Speaker Change #112: <unk> brought in the next day, you're supervising and then you'll have to approve certain matters or not and you're also the employee or so there are different roles to play in this is always a field of tension that you know we live with every day is a supervisor it will not be different from Mr. Fountain drink compared to other supervisory I would like to leave it.

Speaker Change #112: That if you do not mind as long as Mr. From the brain Hasnt been officially appointed I don't think it's necessary that he will explain how haim will go about it if you don't mind well no I <unk>. Please do not consider it as an attack on Mr from them break no I do not consider it.

Speaker Change #113: No because he was explicitly mentioned is aspiring partner and yeah, but we all are we all are.

Speaker Change #113: We are all sparring partners and we actually providers and employers that's you know being a supervisor.

Speaker Change #114: Any other questions.

Speaker Change #114: No.

Speaker Change #114: You now have the opportunity to cast your vote on items five and six you have a few seconds to vote.

Speaker Change #114: For item on the agenda again choice one for two against abstained three.

Speaker Change #115: Your last choice made will count I will share the voting results immediately let's start with item five a proposal to amend the remuneration policy for supervisory Board and I now open the vote.

Speaker Change #115: His seconds.

Speaker Change #115: I now close devote.

Speaker Change #115: Then item five b proposal to a Mandarin minarik and of the members of supervisory board and its committees and our open the vote.

Speaker Change #115: Few seconds left.

Speaker Change #115: And the voting is closed and then you may now vote on six a proposal to reappoint missile ambush is a member of supervisory board vote is open.

In the second.

Speaker Change #115: Voting is closed and then you may now vote on item six b proposal to appoint Mr. Mickey as member of the Supervisory Board and I open the vote now.

Speaker Change #116: His seconds left.

Speaker Change #116: And I now close the vote and finally, you may vote on item six see proposed to appoint Mr. Fernand brink is a member of the supervisory board and I can open the voting.

Speaker Change #116: A few seconds left.

Speaker Change #117: And voting is closed. So this is the end of the second voting bloc I hereby close the voting for this voting block and the results. We're about to see include the votes cast by proxy and votes cast in the room today. So can I have the results place.

Speaker Change #118: Right and again here I conclude that all proposals have been adopted with a large majority.

Speaker Change #118: And then I congratulate my colleagues with their appointment and reappointment Tonya Martin and D. J. Congratulations on your appointment and reappointment that concludes this voting block and we can now go to the last voting block item seven through 11, and again, you'll have the opportunity to ask questions. After item 11.

Speaker Change #118: And then you can vote on all these items seven is the appointment of the auditor of ASM for the financial year 2025.

Speaker Change #118: You have been able to read the explanatory notes, we ask you to agree with appointing a N Y L. L. P auditor as the external auditor for fiscal year, 2025, and I would like to give the floor to the chair of the ASM Audit Committee Stephanie color Golan skirts definitely go ahead.

Speaker Change #118: Place.

Stephanie: Thank you Pauline <unk>.

First I would like to extend my gratitude to KPMG philosophy as orders for their contributions to our audit committee meetings and a professional collaboration during 2023.

Stephanie: As explained during last year's AGM 2024 will be Kpmg's last year as external auditor of ASM due to the mandatory rotation. After 10 years. Therefore, we as audit Committee.

Stephanie: <unk> selection committee together with management for the tender offer new auditor.

Stephanie: We sent out a request for proposals had several onsite meetings in attendance presentation of the three odd firms that participated in the tender.

Stephanie: We raised several questions to offense subsequently, we made a comparison taking into account.

Stephanie: Experience financial is G and other knowledge qualifications the relevant science approach to what's the audit technical considerations and price. We also cleared the independents checks of each firm.

Stephanie: After a careful process. The selection committee concluded that Anthony Young Accountants LLP was the most suitable for ASM going forward.

Stephanie: Therefore, the audit committee made a recommendation to the supervisory board.

Stephanie: To nominate Anthony Young Accountants, LLP with marquee on Montana S Z partner as our new Auditor for financial year 2025.

Stephanie: The SAP supervisory board subsequently.

Stephanie: Nominated Anthony Young for appointment by the G. M. Today, Maggie honest present today to answer any questions. You may have when pulling open the floor for questions later at the end of the block.

Stephanie: Subject to the general meeting approve it today Anson Yao will commence work this year to and smooth and to ensure a smooth transition when it takes over the baton from KPMG in 2025, and audit Committee, we look forward to a fruitful effective and pleasant collaboration with anthem here. Thank you.

Quemoy feel bank.

Stephanie: Many things says Stephanie and I welcome you at.

Stephanie: The company I will now move on to agenda item eight and that is the designation of the year, but management has come to embody tasha are now sheriff's into contracts to subscribe for ordinary shares and to restrict arcs include.

Stephanie: Excellent preemptive rights.

Stephanie: Well at this point is also on the agenda. It consists of two agenda items and heals alternate separately.

Stephanie: I'd make a S. C designation of imports mentioned as the competent body to issue common shares ordinary shares and grant rights to subscribe ordinary shares in accordance with article 501 in five and six of the articles of association. It is proposed that he channel meeting designate a bunch management as the body of ASM, that's subject to the profile of this rash.

Stephanie: Your board is authorized to issue.

Stephanie: Our near sure I conclude great prices, great partner shares for a period of 18 months from the day of the meeting.

Stephanie: The issuance shall take place there.

Stephanie: At such a price and further on such a terms and conditions and shall be determined set at each issuance by D points mentioned if required Timothy profile of the supervisory Board. This right is limited to a maximum of 10% of the entirety issued ordinary share capital of anthem on the date of this meeting.

Stephanie: Agenda item eight b concerning destination of the part you mentioned I think Arthur body to limit or exclude preemptive rights.

Stephanie: With respect to the issuance of ordinary shares and grant rights to acquire ordinary shares. This agenda item is also a voting item.

Stephanie: And this is the execution of preemptive rights in accordance with article says N fly for the arts of shaken in conjunction with agenda item eight eight he cannot meetings for faster to designate the branch management for a period of 18 months from gave this meeting at the body of the company that subject to the approval of the surprise your board is authorized to limit.

Stephanie: Or exclude the preemptive rights of existing shareholders. If on their shares are issued or rights to subscribe for ordinary shares are granted.

Stephanie: Well, we know arrived at agenda item nine this the authorization of the part of management to repurchase or buyback our shares in ASM in accordance with article eight of one of the artisan education. It is proposed that he cannot meeting subject to the profile of each of pressure board authorizing parts management for a period of 18 months.

Stephanie: The date of this meeting to buyback.

Stephanie: Uh huh.

Stephanie: Our.

Stephanie: But there are authorized to buyback a maximum of 10% of the issued capital on the date of this meeting this may be done at a price of at least equal to none in the value of the shares and at most a price equal to 110% of the average closing price of the share.

Stephanie: According to listing on the Ernest Euronext Amsterdam stock exchange on the five trading days preceding the day of the buyback do not arrive at item 10 of the agenda and this concern Sir you propose to cancel shares ordinary shares are held by ASM in order to optimize S. M.

Stephanie: Kept us factor. This is to have the ability to cancel ordinary shares it holds at anytime it sounds shack capital.

Stephanie: The airports management it with your profile system for IC Board proposes to the general meeting to resolve to cancel all are now sheriff in Asia capital of ASM that avail. The acquired pursuant to the authorization on the agenda item nine insofar as they will not be used our house to cover obligations under the long.

Stephanie: Term share incentive plan for employees and members of the board of management. This ex this cancellation may be carried out in one of them at more tranches.

Stephanie: The number of common shares are a necessity there'll be canceled that will be determined by the.

Stephanie: The board of management subjective foregoing pressure.

Stephanie: Pursuant to the relevant legal obligations there are applications that we throw Kennedy.

Stephanie: That can take place early in two months after the decision to withdraw.

Stephanie: Uh huh.

Stephanie: Before it is publicly announced and disciplined pricing each tranche.

Stephanie: Finally, we arrive at agenda item 11, which is after this last voting item are already part of management and supervisory board propose symantec violence, and the artist agitation by including and.

Stephanie: Okay.

Stephanie: For the members of both studies, who are in the office on or after the date of the execution of the deed of of the artist initiation for he took off periods are they are in office. He believes that include a text of the indication in the ARX vegetation.

Stephanie: And Sir in line these centers fancy for shareholders.

Stephanie: And this can.

Stephanie: It can be done we also.

Stephanie:

Stephanie: I see that many listed companies that include the indication in the wireless they proposed to imagine Duffy articles of association has been made available for inspection at the office of S. M and ABN Amro Bank and he asked if the Dave notice for this meeting it always has been published on that side I know granted the opportunity to ask questions about the agenda items.

Stephanie: Seven through 11 is there anybody who asked the question about these agenda items.

Stephanie: Well. Thank you my name's M life and hassle at.

Stephanie: Investment.

M: Yeah well.

M: Mr. <unk> has said that he Nora Tim's team members of his team. They are included in the exam fraught.

M: And this of course, an important Ah appoints a when reappointing E nty cannot and flatness of pneumonia to give a comment on that.

M: We sent them out it doesn't use his microphone.

Speaker Change #121: Oh. Thank you for this question escaped to clarify this point on any other questions.

Speaker Change #122: Now the questions and then I know that there are no further questions and I would like to ask you too.

Speaker Change #123: Start voting I would like to point out to all of the shareholders. This the LASA voting items and after this I will punish our all the voting icon snail status number seven now.

Speaker Change #124: Yeah, Frank about ski.

Speaker Change #124: Auditor.

Speaker Change #124: Hi.

Speaker Change #124: Probably.

Speaker Change #125: You know other tests are just a few seconds left.

Speaker Change #126: I would like to close early voting now then you may vote on the H E. B C designation of board of management I think Arthur Hispanic issue, our net shares and to grant rights to Sky for ordinary shares and I would like to open the vote on this now.

Speaker Change #126: Right.

Speaker Change #127: I only have a few seconds left now.

Speaker Change #127: I would like to close the vote now and then you have a b designation of the what you mentioned that the offer Spanish ardito limits are.

Speaker Change #127: Ismael settlement fried serve with respect to issue himself on the shelf.

Speaker Change #127: I would like to open votes on this too.

Speaker Change #127: Yeah.

Speaker Change #127: Just a few seconds left.

Speaker Change #128: And glaxo close the vote now in.

Speaker Change #128: And this item 90 authorization of the part of management to buyback shares and I would like to open the vote now on this.

Speaker Change #128: Okay.

Speaker Change #128: Just a few seconds left.

Speaker Change #128: And hereby I would like to close the venture and now he arrived at AR.

Speaker Change #128: Ken This is any proposed to cancel ordinary shares I would like to open the vote now.

Speaker Change #128: I see that most of the votes cast.

Speaker Change #128: Yes.

I would like to close the vote.

Speaker Change #129: Now and finally, you may vote on agenda item 11.

Speaker Change #129: The amendment of the articles of association and I would like to open the vote on that now.

Speaker Change #129: Just a few seconds left.

Speaker Change #130: I would like to close the vote.

Speaker Change #130: Since the end of the third chip I think block I would like to.

Speaker Change #130: Accessible for this I think block arena.

Speaker Change #130: And now see the results of the votes and his second says.

Speaker Change #131: These are the votes cast are based on the proxy and also the thoughts from the room, you'll see the results here on the screen.

Speaker Change #131: You see themselves for seven eight a M P.

Speaker Change #131: And.

Speaker Change #131: What's missing here is tending to 11.

Speaker Change #131: This on the next pages. So here are the.

Speaker Change #131: I can say have been adopted or biologic majority and then the next page.

Speaker Change #131: Here, we have the audience and I can and telephony and tell us are these.

Speaker Change #131: Uh huh.

Speaker Change #131: Yes.

Speaker Change #131: This biologically Cherokee one item Eaton is 100% I don't know whether we achieve.

Speaker Change #131: She is.

Speaker Change #131: In the past already Ross. Thank you for your support for any proposals I essentially all of the.

Speaker Change #131: Agenda item has been adopted now are rife at the any other business item.

Speaker Change #132: Give the floor to anybody for the any other business item.

Speaker Change #133: Thank you Mr Chair.

Stephanie: Stephanie C. Fasten itself. The video I have two questions. Sir leveling is M is an organization of public interest and.

Stephanie C.: This important it's important for the economy and for the Netherlands. According to an OECD study.

Study, the Netherlands are lagging behind and filter flooding at some point to now.

Stephanie C.: What they said and how it is down there.

Stephanie C.: If you talk about loving how can he is infancy on applications. This is why they're being as an important item for us.

Stephanie C.: The list.

Speaker Change #135: Offer memberships of association Sir in the annual report is an exhaustive if not may I ask you to include an exhaustive list next year with all of the orientations.

Speaker Change #135: You know walkways.

Speaker Change #135: Accompanied by a statement.

Speaker Change #135: How you verify whether these organizations work in line with the essence and values of S M and of international organizations and then the second question despite secularity.

Speaker Change #135: Any supply chain or restraints they have been soft.

For the larger party has been set but I would like to come back on three critical raw materials.

Particularity secularity is not so much through for ASM, because he just hurts that you sell about 600 systems per year, but I'm curious to know.

Speaker Change #135: I'll, let you do it and filters for clarity of critical raw materials is not enough for a critical Oh I'm curious you can make any antibiotics in H D. S. M chips are being processed. So this the reason for my question well. Thank you for the questions.

Speaker Change #135: To whom may I give the floor Paul do you want to answer this question.

Unknown Executive: So I think you know it has already been publish in the AR.

Unknown Executive: A new report the list of memberships and the associations that.

Unknown Executive: We interact with you are correct that is not the holders and part of it is because some of these are very minor and very local but we will take into consideration that the requests to publish an exhaustive list in the annual report next year.

Unknown Executive: And then the question of if we got the circularity.

Speaker Change #136: Yes, you most likely know Reed.

Speaker Change #136: Design products on a modular basis to serve as those products, which of course increases our circularity.

Speaker Change #136: We also developed a certain surface solutions because you can complete complete good management of solutions that also help again circularity, because we take back parts, we cleaned them and you put them back into into the into the respective for tools instead of <unk>.

Speaker Change #136: Throwing away and and putting in a new a new airports and I would assume but to be honest I didn't know that we'd also benefits critical raw materials, but I would like to invite maybe ECM to say something if all the let's say servicing of tools that we do spares and service solutions that we.

ECM: If if there's something specific for critical raw materials I'm not sure.

ECM: Can you maybe take that question.

ECM: Yeah, I think if I can add to what you mentioned Paul is that we really look at it too.

ECM: Reuse and Hum.

ECM: The material that we use in our in our deposition equipment. So we have precursors, we have chemicals gases liquids and you name it and we've really tried to recycle that so that's.

ECM: That's really another area that we do.

Two two really helping the recirculation of further raw material, it's not something I'm going to talk too much about but it's really something that's really doing and where we're looking we are very actively working in this area.

ECM: He said it a couple of you tell them all the answer to how to operate the Teva Mr. Chair I didn't get a full answer Este loving I also asked for a thing or a declaration.

ECM: So how do you verify.

ECM: Rather the organization.

ECM: It should work.

ECM: But whether they yeah.

ECM: Axa in accordance with international Air tickets, and our values as to surf hilarity I'm talking about the value chain, it's not about the severity of it some but it's about evil chain. If any other chain. There are not enough raw materials are available then perhaps can it be made.

ECM: And in that case, a S M they'll make the last machine, Sir because then the demand for chips.

ECM: How in future can we deal with the lack of critical raw materials in the full value chain.

We actually don't.

ECM: How can I put it.

ECM: The associations or the bodies there we are.

ECM: A part of our membership of Ah I can I can safely say that they are.

ECM: Well known international organizations. So it's not like we are joined some association in some third world country and you know we are not aware of what they are doing.

ECM: So I think you know in that respect.

ECM: If you would give us the proper.

ECM: Perhaps the you know the requests that we publish them in a more exhaustive list of either our membership and so on I think it will be a quite.

ECM: Evident that look these are not our associations that are you know.

ECM: Perhaps a questionable.

ECM: I think.

ECM: Most of the Oh actually associations in the semiconductor industry. They are quite well known so I think maybe you know less.

Speaker Change #138: Let us look into that and then there's two questions of course, you know please come back to us.

Speaker Change #138: Okay.

Speaker Change #138: I cannot something to Oh, Ben Sherman I think raw materials really not a very big problem for us. The reason I'm, saying this is that in the development of our products, especially in L. D. We're actually developing new compounds using the same material as we soon as we use right now the beauty of failed is that every country is different.

The ratio of the normal material and you form and human too. So you can see is the ratio of the normal precursor that we use right now when you make them in different ratio with them to develop a new material. So that's really the focus of our work on L. D is a very good technique to develop new materials.

Speaker Change #138: With the normal components that we use right now.

Speaker Change #138: Okay.

Speaker Change #138: Metal.

Having said.

Speaker Change #139: So is there any last question I see a one last question.

Speaker Change #139: Yeah.

Speaker Change #139: We'll get some have.

Speaker Change #139: Iraqi Molenaar.

Speaker Change #140: I have a general question.

Speaker Change #140: The semiconductor world.

Speaker Change #140: Alrighty, a new front end at a at Becker and the wafer part and then the 70 part a S.

The hunt and ASM delivers its equipment.

Speaker Change #140: At the front and so that the safer ace MTT delivers its equipment until the back end and this last fair to see that the borders are fake theyre an hour away for laughing molding technology saw a.

Speaker Change #140: Special bonding technologies. So my question is.

Speaker Change #140: Yeah.

Speaker Change #140: Is it working with ASM PTA in this transitional stage or.

Speaker Change #141: Not maybe in the field of R&D sell in brief I would like to know this just from a personal interest.

Speaker Change #141: Chairman.

Speaker Change #141: There.

Speaker Change #141: So.

Chairman: Sorry, you I think you have a deep knowledge of the semiconductor industry.

Chairman: It is actually a very true that we are looking at.

Chairman: Certain technologies the upcoming bringing the fund in the back together in a in a foster today, we look at ASM Pacific still as a financial investment. So it was on our books, but of course, you know we have two board seats. So we know what they do.

Chairman: At this moment I don't think we are doing any form of R&D, a joint collaboration but I will not rule out that possibility as this becomes more and more than twice I take that you know for a long time, where does the finance or the backend it was quite separate especially what they do and what we do because we are in that position, but we do see that.

Chairman: There is potentially as the advanced packaging or what do you call heterogeneous integration develops there may be some possibilities, but there's nothing.

Chairman: That is concrete at this moment.

Speaker Change #143: Okay. Thank you.

Speaker Change #143: Nowadays it more definition.

Speaker Change #144: It's a nice effort looking a question I would like to thank you all are for your presence here and for your confidence in this amazing company and free involvement in ASM and so I would classify action on behalf of all of us for a a drain cure and sabic.

Speaker Change #144: The writer and to help that Sandy ores and present members of the board said that his seat or diminishment anti surprised people are present at this meeting so thank you I know class.

Speaker Change #144: Yeah.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Yeah.

Okay.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Speaker Change #144: Yeah.

Speaker Change #144: Okay.

Speaker Change #144: Okay.

Speaker Change #144: Yeah.

Speaker Change #144: Yeah.

Speaker Change #144: Yeah.

Speaker Change #144: Yeah.

Speaker Change #144: Yeah.

Speaker Change #144: Yeah.