Deposition equipment maker Aixtron SE has announced financial report for 2012 that revenue declined by 63% to €227.8m compared with €611m in 2011. But despite the dramatic fall in full-year sales, fourth-quarter revenue of €77.5m was up 25% on Q3/2012’s €62.2m.

Throughout 2012, customers “remained hesitant to add significant LED manufacturing capacity, despite increasingly high utilization rates at some mainline Asian manufacturers,” the firm says. Aixtron describes a “slow recovery of revenues but a virtually flat order intake throughout the year, reflecting a reluctant investment attitude by customers and a continuation of macroeconomic uncertainty. Total order intake in full-year 2012 was €131.4m, down 74% on 2011’s €513.4m. However, orders in second-half 2012 were about 14% higher than first-half 2012. Year-end order backlog stood at €79.4m, 44% lower than the €141m at end-2011 (although a third of this reduction was due to the €19m order backlog adjustment made in Q3/2012).

The second-half order intake development that became clearer in Q3/2012 did not constitute the expected second-half market recovery, and became a catalyst for “a thorough internal review into the company’s immediate outlook”, said the firm. The conclusion of Aixtron’s management, announced in October, was that the objective at the start of the year of remaining EBIT profitable in 2012 was not achievable.

The accompanying risk assessment that was conducted as part of this business review also concluded that the likelihood of “ongoing subdued demand” necessitated the reduction in value of certain work-in-progress assemblies, components and spare parts. The firm had hence executed a significant write-down of €51.5m in inventories in Q3/2012.

The subdued business environment, evident throughout 2012, had a consequent effect on Aixtron’s overall 2012 earnings. Gross profit declined to €0.4m (contrasting sharply with 2011’s €231.4m) and earnings before interest and taxes (EBIT) dived to -€132.3m (compared with a profit of €112.9m in 2011, and worse than the -€125m forecast at the end of October). The firm continues to implement cost-reduction measures, which include both efficiency improvements and cost-reduction measures throughout the organization.

The 2012 net loss of -€145.4m was down considerably on the profit of €79.5m achieved in 2011. Aixtron says that its executive and supervisory boards will propose to its shareholders’ meeting that the 2012 loss should be carried forward, and consequently no dividend for 2012 will be distributed.