Earnings Release

2Q FY2014 Earnings Release Conference Q&A

  • What are the order forecasts for the October to December 2013 quarter and the January to March 2014 quarter, including trends by individual applications and regions?

    The general direction that we anticipate is for SPE orders to remain at about the same levels as in the previous quarter. We also do not expect substantial changes in the breakdown by application. With regard to individual regions, we expect investment in Japan and the US to increase.

  • What are the relative strengths of orders by product types?

    Investment in new fab began in this second half of the year, and as a result thermal processing systems account for a larger portion. Also, cleaning systems are growing significantly.

  • Orders are expected to remain strong, but which final products will be the drivers in 2014?

    Demand for mobile terminals and tablets, particularly high-end devices, will continue to drive development of state-of-the-art logic technology and investment in equipment. With regard to memory, demand for high-end mobile devices will drive the volume of mobile DRAM and NAND, and we expect investment in equipment to remain brisk.

  • What is the forecast for the wafer fab equipment (WFE) market in 2014?

    In 2014, we expect the market to grow by about 10% and to be in the $32 billion to $33 billion range.

  • Do you expect TEL's sales and market share to grow at rates higher than the market averages in 2014?

    As the WFE market grows, we aim to achieve growth in sales and market share at levels higher than the market. As customers start to bring new plants online, we expect sales of thermal processing systems and improvement in our share of the cleaning systems market to boost growth. Etch systems seem to be a little behind, but we are hoping to catch up as quickly as possible.

  • When will STT-MRAM be a driver of orders and equipment investment?

    We expect that STT-MRAM will be adopted to replace some embedded DRAM in logic, in 2016.

  • What is the merger schedule with AMAT?

    The closing is expected for the mid to the second half of 2014, but we hope to implement it as soon as possible, in the summer of next year or even earlier.

  • Calculation shows a premium of 6%, isn't that too low?

    As the merger is business integration from equal positions with shares as 100% of the consideration, we do not believe that it is appropriate to make a simple comparison with a cash acquisition.

  • Are there any issues that TEL wants to resolve prior to completing the merger?

    First, we will review our policies relating to PV. Second, we will consider raising efficiency by consolidating sites and other actions. Third, with regard to personnel, as business is currently growing we will implement appropriate placement of personnel without taking any actions that will lower morale such as terminating employees. Fourth, we will strengthen and increase our original technologies.

  • There was no mention of PV in the merger press release. Have there been any agreements with AMAT concerning PV?

    We are unable to discuss the specifics until the merger.

  • The new integrated company will be listed on the foreign section of the Tokyo Stock Exchange. What are management's intentions concerning removal from TOPIX and other stock indexes?

    Under the current rules, the new company will be treated as a foreign stock and will be removed from TOPIX. We would like to remain in TOPIX, and we plan to discuss whether this is possible with the Tokyo Stock Exchange in the future. Since capital markets are now global, we hope that the Tokyo Stock Exchange will adopt a positive attitude towards examining its policy of including only domestic stocks in indexes, unlike indexes in other countries. With this business integration, we hope to receive support from the Tokyo Stock Exchange with regard to new forms of growth by Japanese firms as global leaders.