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Aixtron admits it will not return to profitability this year

The company has made €51.5m inventory write-downs due to dwindling MOCVD demand
Aixtron SE wrote-down EURO (€) 51.5 million of inventory due to a significantly slower than expected recovery of demand for MOCVD equipment.

The devaluation followed a comprehensive review of inventory held.

This concluded that despite the positive long-term outlook for the LED industry, the existing stock held was inappropriately high in comparison to the current subdued level of demand in the market.

These non-cash effects will lead to a negative operating result of around €78 million in Q3/2012 or €113 million for the first nine months of 2012.

However, for fiscal year 2012, Aixtron expects sequentially stronger fourth quarter revenues, albeit considerably less than previously expected. As a result of the unexpected slower demand recovery, the company will not report a profit in fiscal year 2012.

Aixtron anticipates for fiscal year 2012, that it will achieve full year total revenues of around €220 million. This would be mainly due to the write-offs and the expected negative operating result will be about €125 million.

For fiscal year 2013, the firm's management expects an increase of demand for LED manufacturing equipment. This would be driven by stronger projected demand in the LED lighting market and Aixtron expects to return to profitability during the year.

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