Warm welcome from my end. Here is what we are going to cover today. First, we touch the key achievements of the past year. Cornelia Ballwießer provides more details on the financials. Finally, I will give an outlook for 2025. After that, we will be happy to answer your questions as usual. Let's go through the highlights. First, we managed to execute our high order book, resulting in record sales of EUR 446 million, an increase of 46.6% compared to 2023. Second important message, we have significantly grown profitability and with that reached a completely new level of earnings for SUSS. We already exceeded our previous planned targets for 2025, which were sales of EUR 400 million and EBIT margin of 15%.
Changes compared to the full year 2023 in detail: gross profit margin increased by 5.9 percentage points, EBIT margin up by 7.7 percentage points, and order intake slightly increased by 0.8%. I will go into this in more detail in the following pages. As already outlined in our conference call in mid-January, we achieved a record order intake of EUR 147.5 million in last year's Q4. This development was driven by our strategic global customers in both divisions, particularly in our photomask and bonding business, and for our UV projection scanners. Demand for our coaters continued to improve after a strong Q3. Book-to-bill ratio finally came in at 0.95. Our operations team continued to push forward in the Q4 and enabled quarterly sales of over EUR 150 million for the first time in the history of SUSS .
That was a major accomplishment and resulted in building far more tools than ever before. I've already mentioned the significant improvement in profitability. We achieved a higher gross profit and EBIT margins mainly due to favorable product and customer mix and overall business volume. Let's now move on with our two segments, starting with Advanced Backend Solutions . As we were able to execute many orders for the initial AI-related capacity ramp-up, our bonding business, and especially our temporary bonders, debonders, and cleaners were the main growth drivers. Bonding sales more than tripled compared to the previous year. In contrast, sales in our coating and imaging business were below the 2023 figures as demand was quite weak in the first quarters. In both cases, however, demand improved notably in the second half of the year, which helped us in this year in 2025.
The higher sales volume and related economies of scale, as well as favorable product mix, supported us in improving our gross profit margin by 6 percentage points to 42.2% and our EBIT margin even by 9.8 percentage points to 19.2%. Let's continue with our photomask business segment. As often mentioned and expected, orders from Chinese customers normalized in 2024. In our photomask business, orders from China decreased by EUR 15.8 million. The good news is that all other regions almost compensated for this development. The order book remains well filled at around EUR 157 million. This ensures a very high capacity utilization in 2025 and is the basis for continuing our growth path in this segment. Sales went up by 46.5% year on year to EUR 131 million. Two years ago, in 2022, sales were still at EUR 49 million. This is an amazing development in my view.
We are growing profitability here as the increase in gross profit margin to 36.1% and the EBIT margin to 20.7% demonstrates. Now an update for our new production site in Taiwan. I am doing this today on behalf of our board colleague, Thomas Rohe, who is currently on site in Taiwan, monitoring the progress of the project. He has nevertheless dialed into this call, and he will be available for questions later in the Q&A session. In November last year, we announced that we had signed a long-term lease for this new building. In the meantime, progress is being made. Our team is already on site to streamline all tasks. As you can see from the real pictures on the left and the rendering on the right, the building will combine state-of-the-art cleanroom manufacturing facilities with modern office and meeting spaces.
I think this will be a great place to work. The official opening of the new Zhubei plant is scheduled for the end of October 2025. So far, we are on track to meet this ambitious schedule. I would like to hand over to Cornelia for more information on our financial results.
Thank you, Burkhardt. I welcome all of you also from my side. On this chart, there are some key messages. I, as Burkhardt already presented some of these financials, try to focus on relevant additional information. There has been much discussion about whether we can compensate for the normalized demand from China over all orders from China, followed by EUR 41.4 million compared to the previous year. Yes, we are able to compensate for this. At year-end, there was even a slight increase versus 2023. Gross profit margin and EBIT margin benefited from a favorable product and customer mix and was volume-driven, as already said. EBIT also benefited from a decline in our OPEX ratio to 22.8% of sales, a decrease of 2.5 percentage points.
Net profit amounted to EUR 110.3 million and included earnings after taxes from continued operations of EUR 52.1 million, as well as the result from discontinued operations of EUR 58.3 million, which is the sale of our MicroOptics business. Net cash position with EUR 122 million is strong. Free cash flow in total was EUR 96.1 million, thereof EUR 25.3 million from continuing operations. Investments increased by EUR 3 million to EUR 7.6 million, which is still quite low. This number is expected to increase in 2025 as we plan to invest approximately EUR 20 million in our new fab in Taiwan. In total, CapEx volume is expected to be roughly EUR 30 million. Based on the strong business performance, SUSS proposes to increase the dividend by 50% to EUR 0.30 per share. This would represent approximately 23% of free cash flow from continuing operations.
On this page, I would like to show order intake, sales, gross profit margin, and EBIT margin after have developed over the four quarters. Two things I'd like to highlight. Even though there should be no reason for seasonality in our business, the Q4 really was particularly strong in all key figures. We managed to complete many tools, and our customers were happy to receive these in December. EBIT benefited from the very high business volume. Many customers also placed additional orders to secure production and delivery slots in 2025. Profitability throughout the four quarters was at a high level. The gross profit margin was always at least 39%, and the EBIT margin at least 15%. This shows that given a certain volume of business and focusing on larger customers, we are able to deliver very stable results.
On this chart, you can see this development a little bit deeper in terms of our two segments. Our segment, Advanced Backend Solutions , achieved gross profit margins of at least 40% in all four quarters. In the fourth quarter, EBIT margin was able to mark a high at 25.7%, driven by the very high business volume. Photomask Solutions had a soft first quarter in terms of gross profit margin with only 32.9%, followed by three quarters in a row with at least 37%. EBIT margin in total was better than in Advanced Backend Solutions , as in three out of four quarters, and we were able to pass the 20% margin mark. This page provides some additional background on the segment's performance for the full fiscal year 2024. Advanced Backend Solutions , we were able to exceed the very high order intake of 2023.
AI-related orders for our temporary bonding solutions and our UV projection scanner in 2024 were more or less at the level of the previous year. Orders for our coating systems improved in the second half of the year. Growth in this segment amounted to EUR 100 million, which is an increase of 46.6% year on year, mainly driven by executing the high amount of AI-related bonding orders. Gross profit margin improved by 6.0 percentage points and EBIT margin by 9.8 percentage points. In the Photomask Solutions segment, order intake, as Burkhardt said, was almost at the 2023 level, even with a reduction in order intake from Chinese customers. The order book is still well filled and provides high visibility and capacity utilization in 2025. We succeeded in realizing the sales growth of 46.5% by increasing the number of slots for photomask tools, additional staff, and shortening lead times.
Gross profit margin and EBIT margin both benefited from strong product and customer mix and the very high business volume as well. Let us now take a closer look on order intake. Please note all the three years are adjusted for the MicroOptics order intake, meaning they include only the continuing operations. Order intake amounted to EUR 423.7 million in 2024, an increase of 0.8% compared to the strong previous year. Book-to-bill ratio was 0.95. At the right side, you can see a breakdown of our order intake by region. Asia-Pacific continues to be the strongest driver of our business with a 78% share of global order intake, and Taiwan is our most important market here. Here, let's move on to the balance sheet development. Here, total assets increased by EUR 131.2 million.
Main driver for this increase were the current assets, which went up by EUR 128.9 million compared to year-end 2023. On the one hand, inventories grew by roughly EUR 47 million. In general, the rise in our business volume has led to an increase in inventories. In addition, contract assets rose by EUR 24 million. On the other hand, current assets were reduced by the derecognition of asset held for sales in the amount of roughly EUR 34 million as a result of the MicroOptics sale. Cash and cash equivalents increased by EUR 98 million, in particular driven by the divestment of our MicroOptics business with an extraordinary cash inflow of EUR 75 million in the first quarter. It is also supported by a strong free cash flow from continuing operations.
On the next slide here, you can see due to the high net income in the amount of EUR 101 million, our equity position has been strengthened. The retained earnings increased by EUR 105 million, equity amounts to around EUR 280 million. Our equity ratio is now at 55.9%, which is a very solid number for a growing technology company. Non-current liabilities increased by around EUR 12 million, mainly due to higher deferred tax liabilities and provisions. The current liabilities increased by EUR 16 million compared to year-end 2023. Contractual liabilities went up EUR 10.7 million, tax liabilities by EUR 8.8 million, other financial liabilities also by EUR 8.7 million, and trade payables by EUR 4.4 million. This increase was partly offset by the derecognition of liabilities associated with assets held for sale in the amount of EUR 13 million. Just to add this here, you cannot see it in the balance sheet right now.
Our new production site in Taiwan will cause an increase in total assets by roughly EUR 40 million because of the new site and our leasing contract with this new site. Yeah, that's it on the balance sheet. Now, let us talk a little bit about our ESG efforts and the ESG report. I would like to inform you about our progress in our ESG activities. ESG, as you know, stands for Environmental, Social, and Governance. In 2024, we worked hard on the new ESG report based on the European Sustainability Reporting Standards, shortly ESRS. We have invested a lot of time and effort in this project. The application of the ESRS was supposed to become a legal requirement for Germany in 2024, but the law was not passed due to the dissolution of the coalition.
However, our report already complies with the ESRS, even though its application in Germany for 2024 is voluntary. The report offers a lot more information and is now roughly 150 pages long. To be honest, the fact that non-financial reporting exceeds financial reporting is certainly something that needs to be reviewed. Just to mention, in Denmark, the CSRD reports were already mandatory for 2024. The reports are much shorter than in Germany. This tells a lot about German sorrowfulness. Currently, the EU Commission is working on some simplifications and reducing the requirements. I would like to emphasize that the efforts we have put into this project were helping to push the ESG topics. The reporting is, in my opinion, overdone. This brings me to three topics we really focus on.
In 2024, we have defined three non-financial KPIs we are looking at on a regular basis over the year. These KPIs are part of our group-wide control system. It is CO2 emissions of Scope 1 and 2, employee engagement score, and the compliance trainings, the participation rate, the compliance trainings. All of these KPIs developed positively in 2024. Compared to 2023, the CO2 emissions in Scope 1 and 2 were down significantly in absolute terms. In 2023, it was 4,144 tons. You can see there is really a big success here on this point. Especially the switch to renewable helped our Scope 2 emissions. Overall, energy consumption on Scope 1 was also lower. However, we did not fully meet our target in 2024. We were with 74 tons, that's 5.2%, slightly above the target value as we could not completely source renewable energy in Taiwan.
For 2025, we expect emissions to increase. The main driver will be the increase in business volume and the fact that we cannot switch to 100% green energy in Taiwan. We also rolled out our quarterly employee engagement score. It tracks the likelihood of employees' recommendation of SUSS as an employer. In 2024, the score was 38%. For 2025, we want to bring the score to 50%. Lastly, our trainings on compliance. Here we achieved 98% in 2024. Of course, our target is at 100%. The deviation of two percentage points results mainly from onboarding new employees in the last weeks of the fiscal year. They will attend or already did attend the trainings in early 2025. We aim to cover 100% of employees in 2025 again. With that, I hand back to you, Burkhardt.
Thanks, Cornelia. A lot of numbers, but very good numbers.
I hope you also enjoy the new form and shape, how we present this with great transparency in our new corporate templates. Now let's move on with the outlook 2025, which I guess is the most important news in our annual report today. First of all, how did we come to our sales expectation? Starting point and the base is our order book as of December 31, which amounted to roughly EUR 428 million. The vast majority of this number, let's assume around EUR 410 million, is expected to be executed in 2025. In addition, thanks to shorter lead times and our increased flexibility in our operations setup, we will have open manufacturing slots in the second half of 2025, especially for our Advanced Backend Solutions .
This means that we can still fill our production plan in H2 with additional orders, which we are collecting as we speak until the end of the first half of 2025. In our budget, we have included a revenue contribution of EUR 60 million-EUR 100 million from this. If we combine both elements, we get to a sales guidance of EUR 470 million-EUR 510 million as a range. This means we clearly plan to continue our growth trajectory in 2025. The midpoint of the sales range, EUR 490 million, would represent growth of 10% compared to 2024. We expect the gross profit margin to stabilize in the 2025 financial year. The product and customer mix that led to the significant increase in the margin in 2024 is likely to be of a similar quality in the 2025 financial year.
Meanwhile, a positive volume effect will be offset by one-off expenses for setting up the new production site in Zhubei, Taiwan. Taking all factors into account, we expect the gross profit margin to be in the range of 39%-41% in the financial year 2025, after 40% in 2024. In terms of EBIT, we expect positive momentum from higher sales volume and the associated economies of scale. At the same time, our growth transformation will have a greater impact in 2025. While we anticipate an increase in R&D and selling expenses that will be roughly proportional to sales growth, we expect administrative expenses to increase further. The main drivers here are IT projects, such as the preparations for the migration of our ERP system to S/4HANA, and the implementation of a new consolidation and reporting solution, ESG projects, and the rising expenses for recruiting and personnel.
Overall, we expect an EBIT margin in the range of 15%-17%. I can assure you that we remain ambitious and are fully focused on implementing our strategy 2030 to achieve further substantial improvements. In essence, we are focusing on innovative solutions for leading customers in the semiconductor industry, which we will manufacture in small series. We expect this focus to improve the scalability of our business model with further growth and higher profitability. We will provide more information on our mid and long-term ambitions at a Capital Markets Day, which we are planning on November 17th, 2025. Please make a note of this date in your calendar already today. Those interested can also combine the CMD with a visit to Semicon Europe in Munich, which starts one day later on November 18th. Finally, a few insights into how we expect our two segments to develop.
Let's start again with Advanced Backend Solutions . Here we expect to grow at a mid-single-digit rate year on year based on the order book and the current market demand. As we anticipate a minor change in our product and customer mix and higher R&D expenses, the gross profit margin and EBIT margin are expected to decline slightly. Regarding the current market demand, we expect a higher demand for our imaging systems, especially for our UV projection scanners, which is qualified for the CoWoS process, as you know. The improved situation in the coating business is expected to continue, for example, driven by OSAT and foundry customers. In bonding systems, a slight decline in order intake is realistic, as follow-up orders cannot keep the pace with the initial order volumes of the past two years due to large capacity ramp-ups, especially at the HBM players. Let's move on to Photomask Solutions .
Based on the strong order book of EUR 157 million at year-end 2024, we expect sales growth in the range of 10%-20%. Higher sales volume and a better product and customer mix is expected to positively impact gross profit and EBIT margins. Order intake in 2025 can be slightly below 2024 level due to the ongoing normalized demand from China. Additional momentum from the launch of our new high-end and mid-end cleaner line, which are both planned for 2026, is anticipated towards the end of 2025, at the earliest if we receive early orders and further orders for those systems. We are now happy to answer your questions.
Thank you very much for the presentation, and we will now move on to the Q&A session. For a dynamic conversation, we kindly ask you to ask questions in person via the audio line.
To do so, click on the raise your hand button. If you have dialed in by phone, please use the key combination star nine followed by star six. If you do not have the opportunity to speak freely, you can also place your question in our chat box. We received some raised hands, and Mr. Kuhn, you should be able to speak now.
Good afternoon. I hope you can hear me.
Yes.
Fantastic. Thank you. Starting with the order intake, Q1 is almost done, two or three working days remaining. Is it realistic to assume that, let's say, the lower end of your sales guidance is almost achieved with the order momentum or maybe a little broader? What recent order trends have you seen over the first three months of the year?
Yeah, please forgive us that we do not comment on Q1 developments, but so much to that, it would be unrealistic to expect order entry levels we experience in the Q4 of the year. We are more kind of operating closer to the range of the third quarter. That is kind of what we could indicate.
That is a solid indication already. Maybe on, let's say, profitability, you mentioned the growth and the transformation investments that you plan this year. Looking at the implied OpEx, is there cost components, for example, for IT projects that you would define as non-recurring, i.e., could we expect some moderation then in 2026, or is that all costs that will, let's say, sustainably come on top?
Hello. No, these costs are more or less non-recurring items. Of course, in the long run, our cost level will increase a little bit.
For 2025, there are really one-time effects in it for different reasons, especially for IT and digitalization projects. Could you roughly quantify those effects? Roughly, I would say regarding IT, EUR 3 million or EUR 4 million. There are some other projects. I would say in total, we will have extra costs in next year, EUR 4 million-EUR 7 million for transformation.
Perfect. Thanks a lot. One more question on, let's say, current capacities and plant capacities with the new fab in Taiwan. I guess in Photomask, you are now with the sales guidance for this year operating relatively close to capacity. What about the other tool categories? Where do you plan, or let's say, how flexible can you build up capacity and shift between the different categories? What would you expect in terms of growth by category, let's say, over the next two to three years?
Okay. Yeah, Thomas Rohe speaking and answering. Thank you for the question. Capacity, I would say concerning Photomask, we are really, I think, well, yes, not at the limit of the capacity, but the capacity is really in line with the order intake right now. Concerning all other business units and product lines, we have the capacity to even grow further. We have also a capacity to handle orders which are coming in right now, even this year. We also have the capacity to even grow further. With the new fab in Taiwan, we have also a spare area, which we can even increase for the next year. This is really giving us a very good position to, yes, support our growth ambitions for the next years. The shift between the sites is also something which we are already doing. This is nothing new.
We did it in the last year where we, or the year before already in November 2023, when we shifted the bonder line, the bonder system from Germany to Taiwan and then vice versa. This is also something which we can do and which we are doing to level out the capacity and the utilization.
Okay, thank you. Very last question on the two, let's say, future growth projects or two of them, wafer cleaning and hybrid bonding. Could you provide us an update on those two, please?
Yeah, wafer cleaning is, of course, a new product segment we are entering. There we are in a phase that we are kind of in a closure of the development and starting to have a better tool available towards the end of the year, which then also can be tested by customers.
That still is a lower volume tool, but a high volume production tool is in close pursuit. That is well on track to be evaluated towards the end of the year. The hybrid bonding, as you know, we are rolling out products as we speak. We have a Die-to-Wafer hybrid bonder to be launched in the next quarter. This is just a couple of weeks from now, which is the first one which can be positioned in a production environment. We are on track with the execution there. It is more the question of, are customers ready to deploy hybrid bonding, especially in the memory space? That is still out for debate when this is actually happening. We are still targeting volume sales in the timeframe of 2027. In that sense, our timeline has not changed.
Thank you very much.
Thank you for your questions, Mr. Kuhn. We now move on to Ms. Jenkins. Ms. Jenkins, you should be able to speak now.
Hi, can you hear me okay?
Yes.
Yeah. Hi, guys. Thanks for taking my questions. My first is just kind of, we've seen recent news around a potential moderation of CoWoS capacity additions at TSMC and also potentially a mix shift to their SOIC technology kind of in line with potentially NVIDIA's Rubin GPU moving to hybrid bonding. I was just kind of wondering what kind of you thought of this and also kind of what you expected in terms of CoWoS demand in the next few years. Thank you.
Madeleine, thanks for your question. That's a good one. Of course, we are working very close with the leading company engaged in CoWoS versions and variants.
In the last few months, demand, at least for the tools we supply into this process, went up quite significantly. We started this effect already seeing this effect in the Q4 last year where we started getting larger orders. This continues also throughout this quarter. In contrast to what sometimes is seen in the press, at least demand for our solutions, and we are only providing a few machines in this very complex process, look pretty good. As a matter of fact, as we speak, scaling up our, especially the UV projection scanner production in Taiwan with the multiple of the capacity we had before.
Okay, that's very helpful. Thank you. Just a quick follow-up. I saw in your annual report, you're saying demand for China in advanced back-end solutions is down quite a lot. I think it was like 30%.
What's driving that reduction in orders last year? Just if you could give me some color, that would be very helpful. Thank you.
I think China is, and this is also covered, of course, by other companies, is normalizing across a broader base. That affects us equally in Photomask, but also in back-end business. Larger companies reported on that, that they see a normalization towards a 20% level of their share. While I think this is a bit conservative, we still see slightly higher levels, but we agree to this trend that it's reducing. The effects have multiple reasons. There's also a saturation effect going on after a few years of heavy spending, you could even say hoarding of semiconductor fab-related equipment, but also, of course, saturation of installing those capacities.
I think it's wise not to go in with similar China's more than a year ago, and we started to materialize as of the second half of last year. This is no surprise to us. It was anticipated, but we still have very strong business links in China, and we want to maintain it.
Okay, thank you.
Thank you. We move on to Veysel Taze. You should be able to place your question now. Yes, you are unmuted, but we can't hear you. Try again, maybe. We move on to our next participant. This is someone from Apus Capital . You should be able to speak now.
Yes, hello. Good afternoon. Hello. You can hear me. Yes. First, congratulations to the great presentation. The charts are much, much better than in history. Much more information.
First question regarding the actual maybe discussion yesterday heating up against with statements about Microsoft and Baidu. Any comments from your customers how they see the development of the AI market and also the development of the HBM market? Coming back to a further earlier question, it looks even that the demand for HBMs is increasing with the next generations of NVIDIA's chips. Rubin needs more in my eyes. Any maybe direction, any maybe you can say from your view about the actual further maybe concerns that there could over-investments and that the market could slow down? Any comments from your customers would be helpful.
Yes, good questions, Johannes. Thanks for the praise. A lot of work went into the reporting, so it's nice to be recognized. In the question you're asking, there's of course the billion-dollar question, which is very hard to see.
I mean, you also watched the GTC with Jensen Huang for NVIDIA. There are new chip generations coming out which have 100x of the processing power, and demand for AI, I think, will remain strong. We have two effects here. One is the saturation of and getting those lines into yield and into volume. We installed multiple lines at those players in the past quarters, and we still do so. This is not ending. These lines, of course, have to produce output first. We do see somewhat a slowdown, but I would say it's just a pause to absorb in the capacity because, as you all know, HBM was heavily under-invested in terms of capacity. This had to be compensated. We are busy with that. We see continuous orders also coming in, just not at the level we experienced the last five quarters before.
It keeps going. It will always be an absorption, then another sprint. I think this is by far not over yet. We are confident that this will continue. I mean, luckily, we are not solely depending on HBM. There are many other products we have going in different applications. Often SUSS is being reduced to an HBM bonder player only, but of course, we have much more in our portfolio.
Great, thanks. Maybe a question to the new product versions of mask cleaner and also the UV scanner. Maybe how much that you have even a mid-class solution now for the mask cleaner. This could be additional, maybe opens your additional market opportunities.
More important, if I look especially to the gross margin of the Photomask business, which has a clear maybe gap to your back-end solution, how much maybe with the new versions there's a chance that you can close up a little bit this gap because of a new construction you mentioned before, which is maybe better maybe sales to cost relations than you had before.
Yeah, indeed, we have high expectations for the mid-end cleaner, which is currently under development. That addresses particularly the needs of customers who are non-EUV customers, but who have been buying our high-end equipment before, which is kind of overkill for the application. The mid-end cleaner addresses cleaning needs between 30 and 70 nanometers, so more the mature semiconductor processes. Indeed, has a much different cost price point. Therefore, we want to really address this field.
We have a mid-end cleaner, but this is coming to age and almost end of life. This is a new version, a modular version, which deploys many of the higher-end features, but in a modular way, where we can address mid-range applications much better. We see a lot of interest already now while this machine is still under development. There is a big replacement need also for aging installed base machines, not only in China, but across the world. This will be, I think, a quite interesting new product which will be available soon. UV scanner, that is of course to broaden the applications. There we have a roadmap in improving the overlay accuracy, but also the overall cost structure because also our existing UV scanner has a very established bill of materials.
We do really a redesign of that one with a few more innovation steps coming in the next one to three years to also find more customers in this product segment beyond and above CoWoS applications.
Could maybe this is a new, so not only the mid-range, it is also a new high-range mask cleaner. Could it also be a help maybe to bring this margin of the Photomask segment higher or is it from the different kind of business, from maybe less own work, more parts you buy from outside, given that there is this huge difference between the back-end and the gross margin of the masking, the Photomask business?
Yeah, indeed. The new high-end version we are working on, that is the MaskTrack Smart, which is becoming ready in the next few quarters, is exactly addressing what you said, Johannes.
It will have a better margin structure while offering additional features and having kind of a more value-priced approach. That one, I think, will contribute to further margin improvements. If you look closely at the margin of the Photomask business, especially last year, it has greatly improved. As a standalone segment, this one looks actually really, really good compared to previous years. We do not want to stop there. We want to, of course, make sure that our high market share is also represented in a decent margin.
Maybe a question to Cornelia. We did not discuss or see a chart about working capital and working capital in relation to revenue. Are you here at your target or do you see ways to improve this ratio and therefore maybe increase the free cash flow further?
Yeah, thank you for your question.
Of course, our target is to improve in terms of working capital. As you can see in the figures, working capital increased in 2024, especially in the Q4 because we pushed our tools and had revenue recognition, but at the same time, contract assets went up. Inventories are a little bit too high, and we are working on this.
Thanks a lot.
We thank you for your questions, and we move on to our next participant, Ms. Winkler. You should be able to speak now and place your question.
Hello everyone, and thank you for taking my question. Following up on the demand environment for temporary bonders you mentioned earlier, and you also mentioned during your prelim call, that you see a more even distribution for bonding solutions, not only related to AI.
Could you elaborate for what applications and from what regions these orders are coming from?
Yeah, of course, the biggest application area is indeed the AI space, so there's no doubt about that. We have other applications. Any application where wafer thinning is required is basically a target application for our temporary bonders because that is happening across the industry. That is happening in silicon carbide. It is happening in various other markets. It is not solely focused on that. However, AI was the biggest boost we experienced last year. It is difficult to keep running on that level. Therefore, we are very actively looking for additional application fields and are quite happy that we have a broader portfolio to compensate with other products, which is quite a benefit. Does it answer your question, Nicole?
Yes, thank you. Very clear.
Another one on your P&L, I've noticed that the R&D expenses and percentage of sales dropped by more than two percentage points. Could you give us some more background to the under-proportional growth, especially keeping in mind that you're still in developing of the wafer cleaner, for example, and the mid-end mask cleaner? Should we expect this as a normalized run rate, or what are the reasons for that?
In R&D, we have, especially in the Q4, more R&D projects than we have usually over the month and time. Our level of R&D expenses will increase a little bit over time, yes, also in future.
Okay.
Nicole, you were asking around the R&D ratio, right? Yes, exactly. Yeah, okay. One driver, Thomas, you can answer.
Yeah, one comment. The ratio goes a little bit down, correct? The absolute number goes up.
This is simply due to the reason that we cannot speed up with the R&D extension as we want to, mainly because we were really hiring a lot of people. We went up with our R&D expense, but not at the speed that we planned initially. In the end, you can expect that we go up with our percentage rise in the future, depending on the rate how we find people, but also how we find external companies to support us in our R&D roadmaps.
Okay, well understood. Yes. Maybe also on the CapEx expectations, the EUR 20 million earmarked for the Taiwan site, how much of this is geared towards clean room facilities and how much to office meeting spaces? Can you give us a percentage range here?
At the beginning, I do not have a really clear percentage why. It's for sure mainly the most money goes into the clean room and also the infrastructure for the clean room because this is two floors which we really build up as a complete clean room there in Taiwan. I do not have the percentage really by hand right now. Perhaps you can really read it up later.
Okay, perfect. Thanks a lot.
Welcome.
Thank you. We move on to our last participant with a question so far. Mr. Schaumann, you should be able to speak now.
Yes, good afternoon. First question is on the OpEx. Firstly, you had a quite unusually strong surge in the last quarter of the year coming from lower 20s per quarter in Q1 to Q3 to more than EUR 32 million in Q4.
Maybe you can elaborate a bit more on the background. Then secondly, the indication for the one-off increase in the OpEx this year, does that only affect 2025 or that carryover in 2026 and then phase away only later years, or will these projects be more or less finished by the end of the year?
Hello, thank you for your question. Yes, OpEx in the fourth quarter are roughly EUR 9 million higher than in the other quarters. There are some non-recurring items or special or extraordinary expenses for bonus provisions and special payments for all the SUSS employees worldwide because we wanted our employees to participate in the success of this outstanding year. It is around EUR 4-EUR 4.2 million. In addition, roughly EUR 1.5 million in higher R&D expenses in the Q4. The rest spread across various topics, for example, IT or maintenance activities at our locations.
Yes, there will be some project costs, especially IT, because we are at the start of many of our IT initiatives that will spill over into 2026.
The one-off character is it's not very short-term one-off, so it will potentially carry on for a while. Especially the big IT projects, yes. A quick one on China. Do you expect a further headwind from further declining demand from China, or would you say that as you experienced the slowdown since a year or so that the current demand should prove to be more or less stable?
It's always difficult to project the future, but I think corrections took place. Of course, we need to watch the geopolitical space, but nothing hampers us to do business in China at the current state following the new rules.
We do not see any signals of further decline, except of course the photomask business, which already has settled in. We try to counter that also with having this mid-end cleaner available soon because I think this will, especially in China, trigger quite some interest.
Yeah, okay, thanks. Then again on HBM, sorry for that. I mean, looking at the technology roadmap provided by NVIDIA, I mean, we are going to see kind of a pretty significant step up in HBM content in the Rubin Ultra, which is scheduled to launch in the second half of 2027. Do you think that would kind of give the temporary bond market a new push then maybe next year, or is that too early to tell, or do you have no real opinion on that? Any thoughts from your side on that would be appreciated.
Yeah, as you know, wafer thinning needs you need for all generations of HBM. As I said, a large installed base is being processed right now. I can't tell once that peaked out in serving this extra demand. That's very hard to guess. I said several times before, I do expect further waves once the line capacity is being fully utilized. We still see a lot of installation activities taking place. We see those lines not running at peak capacity yet. There is still some room. Once that room is exhausted, I would expect new orders also to us.
Yeah, okay. Thanks.
Thank you. Again, we try to give Veysel Taze the opportunity to place the question. You should be able to speak now. We still can't hear you.
Therefore, we move on to another participant with a question. Mr. Müller, you should be able to speak now and place your question.
Yeah, thank you for taking my question. Just one. You alluded to Q1 order intake being in the order of Q3 last year. I think it was around EUR 85 million. Now, just as a working example, let's assume you have EUR 85 million of orders in the next following quarter, so that's around EUR 340 million. Obviously, let's say the sales are mid-range around EUR 490 million in 2025. It means the order backlog would come down dramatically, probably to levels then. I mean, if I do the math correctly, it would be around EUR 280 million or so order backlog by the end of 2025. Now, where do I want to go with that?
I mean, if you have an order backlog of EUR 280 million by the end of 2025, you might have sales in 2026, obviously depending on many things, but maybe around EUR 400 million. A sharp decline from where we are now. My question is, I mean, you're ramping now. You're ramping costs, especially OpEx costs. I mean, we've seen a sharp increase in Q4. Even on this now, even including Q4 on an elevated level, we see another sharp increase of OpEx costs. I mean, what would happen in 2026 if the sales were to decline to levels of around EUR 400 million? I mean, what would you expect to be able to counterbalance on the cost side, given that you're just increasing costs to kind of stabilize the margins?
These are, of course, many questions. Maybe I have to put in context the Q1 expectations.
I said we're closer towards Q3. I think we still end up above that. A single quarter never makes a full year. We will have an uneven distribution over the year. As you've also seen, I think we showed the data of the last two years, how much variance is there in the quarterly order intake. Often, orders, especially for big ticket items, are pushing over quarter end and then have a relatively large impact. This doesn't give me sleepless nights. We think we can end the year with a higher order intake than you depicted there. The second question is about ramping up and scaling. There probably Thomas can also chip in, but let me take a start here. We are scaling in a very flexible way.
The new site we are moving into actually will improve efficiency because we are consolidating by now more than eight sites we have in Taiwan into a single site. This new site has room for more capacity, but only will be built up in a phased approach. We will only build out as much capacity as we have visibility to not create overcapacity. This can be done in a very smart way. Thirdly, we have really a complete new production planning and a better system in place that we are much, much more flexible how to plan our production. Also in terms of manufacturing headcount, where we can easily switch gears there to adjust for changes in market demand. Having said all that, I expect greater efficiencies.
is why we are running these programs, which yes, costs some money, but will actually save money in the long run and give us much more flexibility. Therefore, I think the risk you were hinting at there, I think, is somewhat under control. Nobody can steer the market, of course. We have to follow what the market does, but we will maintain maximum flexibility. We do have midterm plans to grow further. At which rate we will tell more about towards the end of the year. That is why we invited you all for our Capital Markets Day. One quarter, and I think I said exactly the same a year ago, will not make a year.
Cool. Thank you very much.
Perhaps I may make a short notice also on this.
Burkhardt already said a lot, but concerning the flexibility also in operations, be aware that we really did a little bit of our homework, what we said last CMD. Capital Markets Day that we have flexibility in manufacturing in terms of outsourcing, where we have flexible capacities at suppliers. The second point is we have also really pretty high flexibility with temporary workers right now so that we really can react in a very flexible, very fast way on any downturns, which could be ahead of us, which we do not expect right now.
Thank you.
Thank you. We give Veysel Taze a last try to place the question. You should be able to speak now, and hopefully we will hear you. Unfortunately, this is not the case. We have no more participants with any questions. We come to the end of today's earnings call.
Thank you, everyone, for joining. Your shown interest in SUSS MicroTec and this lively conversation. Should further questions arise at a later time, please feel free to contact Investor Relations. A big thank you also to you, Mr. Frick, Dr. Ballwieser, Dr. Rohe, and Mr. Köpsel. I wish you all the best and a lovely remaining day. With this said, I hand over to Mr. Köpsel for some final remarks.
Yeah, thanks. Just one remark. As addressed, please get in touch if you have any more questions today, tomorrow, or next week, or whenever. Veysel , you can also give me a call later this afternoon. I'm there for you. Bye.