ASML Holding (ASML) 6-K Current report (foreign)

Exhibit 99.3

ASML — Summary U.S. GAAP Consolidated Statements of Operations^1,4

	Three months ended,						Twelve months ended,
(in thousands EUR, except per share data)	Dec 31, 2007			Dec 31, 2008			Dec 31, 2007			Dec 31, 2008
Net system sales		834,857			380,466			3,351,281			2,516,762
Net service and field option sales		120,063			113,354			416,904			436,916
Total net sales		954,920			493,820			3,768,185			2,953,678
Cost of sales		565,306			454,830			2,218,526			1,938,164
Gross profit on sales		389,614			38,990			1,549,659			1,015,514
Research and development costs, net of credits		129,313			127,471			486,141			516,128
Amortization of in process R&D		—			—			23,148			—
Selling, general and administrative costs		56,897			46,712			225,668			212,341
Income (loss) from operations		203,404			(135,193	)		814,702			287,045
Interest income		5,494			4,965			33,451			22,599
Income (loss) from operations before income taxes		208,898			(130,228	)		848,153			309,644
(Provision for) benefit from income taxes		(16,356	)		42,204			(177,152	)		12,726
Net income (loss)		192,542			(88,024	)		671,001			322,370
Basic net income (loss) per ordinary share		0.44			(0.20	)		1.45			0.75
Diluted net income (loss) per ordinary share		0.43	3		(0.20	) 3		1.41	2,3		0.74	3
Number of ordinary shares used in computing per share amounts (in thousands):
Basic		439,317			431,989			462,406			431,620
Diluted		444,569	3		431,989	3		485,643	2,3		434,205	3

ASML — Ratios and Other Data^1,4

	Three months ended,							Twelve months ended,
	Dec 31, 2007			Dec 31, 2008				Dec 31, 2007			Dec 31, 2008
Gross profit as a % of net sales		40.8			7.9				41.1			34.4
Income (loss) from operations as a % of net sales		21.3			(27.4	)			21.6			9.7
Net income (loss) as a % of net sales		20.2			(17.8	)			17.8			10.9
Shareholders’ equity as a % of total assets		46.4			50.5				46.4			50.5
Income taxes as a % of income before income taxes		(7.8	)		(32.4	)			(20.9	)		4.1
Sales of systems total (in units)		55			25				260			151
ASP of systems sales (EUR million)		15.2			15.2				12.9			16.7
Value of backlog systems total (EUR million)		1,697			755				1,697			755
Backlog systems total (in units)		89			41				89			41
ASP of backlog systems (EUR million)		19.1			18.4				19.1			18.4
Value of booked systems total (EUR million)		803			127				2,970			1,569
Net bookings total (in units)		54			13				186			103
ASP of booked systems (EUR million)		14.9			9.8				16.0			15.2
Number of payroll employees		6,582			6,930				6,582			6,930
Number of temporary employees		1,725			1,329		��		1,725			1,329

ASML — Summary U.S. GAAP Consolidated Balance Sheets^1,4

(in thousands EUR)	Dec 31, 2007		Dec 31, 2008
ASSETS
Cash and cash equivalents		1,271,636		1,109,184
Accounts receivable, net		637,975		469,498
Current tax assets		—		87,560
Inventories, net		1,102,210		999,150
Deferred tax assets, short-term		78,395		71,780
Other current assets		234,529		236,077
Total current assets		3,324,745		2,973,249
Deferred tax assets		141,032		148,133
Other assets		59,991		119,227
Goodwill		128,271		131,453
Other intangible assets, net		38,195		26,692
Property, plant and equipment, net		380,894		540,640
Total assets		4,073,128		3,939,394
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities		1,326,757		1,051,402
Long-term debt		602,016		647,091
Deferred tax liabilities		245,415		209,699
Provisions, long-term		—		15,495
Other liabilities		7,936		26,938
Total liabilities		2,182,124		1,950,625
Shareholders’ equity		1,891,004		1,988,769
Total liabilities and shareholders’ equity		4,073,128		3,939,394

ASML — Summary U.S. GAAP Consolidated Statements of Cash Flows^1,4

	Three months ended,						Twelve months ended,
(in thousands EUR)	Dec 31, 2007			Dec 31, 2008			Dec 31, 2007			Dec 31, 2008
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)		192,542			(88,024	)		671,001			322,370
Depreciation and amortization		28,965			36,282			126,344			120,384
Impairment charges		874			20,546			9,022			22,742
Loss on disposals of property, plant and equipment		1,638			1,603			14,210			5,430
Share-based payments		6,164			3,173			16,506			13,535
Allowance for doubtful debts		(1,889	)		153			(178	)		(160	)
Allowance for obsolete inventory		28,980			85,777			79,592			139,628
Deferred income taxes		46,186			(2,708	)		106,403			(34,155	)
Income taxes payable		(38,485	)		(91,441	)		(74,428	)		(158,277	)
Change in assets and liabilities		(185,056	)		(102,797	)		(247,461	)		(150,751	)
Net cash provided by (used in) operating activities		79,919			(137,436	)		701,011			280,746
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment		(53,964	)		(71,060	)		(179,152	)		(259,770	)
Proceeds from sale of property, plant and equipment		1,656			—			5,011			—
Purchases of intangible assets		—			—			—			(35	)
Acquisition of subsidiary (net of cash acquired)		—			—			(188,011	)		—
Net cash used in investing activities		(52,308	)		(71,060	)		(362,152	)		(259,805	)
CASH FLOWS FROM FINANCING ACTIVITIES
Capital repayment		(1,011,857	)		—			(1,011,857	)		—
Purchase of shares in conjunction with conversion rights of bond holders and stock options		(203,602	)		—			(359,856	)		(87,605	)
Dividend paid		—			—			—			(107,841	)
Net proceeds from issuance of shares and stock options		22,801			6,509			63,307			11,475
Net proceeds from issuance of bonds		(35	)		—			593,755			—
Excess tax benefits (deficiencies) from stock options		1,944			(1,883	)		9,006			2,144
Redemption and/or repayment of debt		(7,843	)		(1,131	)		(9,718	)		(2,411	)
Net cash provided by (used in) financing activities		(1,198,592	)		3,495			(715,363	)		(184,238	)
Net cash flows		(1,170,981	)		(205,001	)		(376,504	)		(163,297	)
Effect of changes in exchange rates on cash		(2,610	)		1,192			(7,717	)		845
Net decrease in cash & cash equivalents		(1,173,591	)		(203,809	)		(384,221	)		(162,452	)

ASML — Quarterly Summary U.S. GAAP Consolidated Statements of Operations^1,4

	Three months ended,
	Dec 31,			Mar 30,			Jun 29,		Sep 28,			Dec 31,
(in millions EUR, except per share data)	2007			2008			2008		2008			2008
Net system sales		834.8			820.0			725.6		590.7			380.5
Net service and field option sales		120.1			99.2			118.6		105.8			113.3
Total net sales		954.9			919.2			844.2		696.5			493.8
Cost of sales		565.3			545.6			506.7		431.1			454.8
Gross profit on sales		389.6			373.6			337.5		265.4			39.0
Research and development costs, net of credits		129.3			128.3			130.2		130.2			127.5
Selling, general and administrative costs		56.9			57.3			56.4		51.9			46.7
Income (loss) from operations		203.4			188.0			150.9		83.3			(135.2	)
Interest income		5.5			4.2			6.4		7.1			5.0
Income (loss) from operations before income taxes		208.9			192.2			157.3		90.4			(130.2	)
(Provision for) benefit from income taxes		(16.4	)		(47.1	)		34.7		(17.1	)		42.2
Net income (loss)		192.5			145.1			192.0		73.3			(88.0	)
Basic net income (loss) per ordinary share		0.44			0.34			0.45		0.17			(0.20	)
Diluted net income (loss) per ordinary share3		0.43			0.33			0.44		0.17			(0.20	)
Number of ordinary shares used in computing per share amounts (in thousands):
Basic		439,317			431,600			431,221		431,672			431,989
Diluted3		444,569			434,959			434,585		434,491			431,989

ASML — Quarterly Summary Ratios and other data^1,4

	Three months ended,
	Dec 31,			Mar 30,			Jun 29,		Sep 28,			Dec 31,
	2007			2008			2008		2008			2008
Gross profit as a % of net sales		40.8			40.6			40.0		38.1			7.9
Income (loss) from operations as a % of net sales		21.3			20.5			17.9		12.0			(27.4	)
Net income (loss) as a % of net sales		20.2			15.8			22.7		10.5			(17.8	)
Shareholders’ equity as a % of total assets		46.4			44.5			49.7		50.3			50.5
Income taxes as a % of income before income taxes		(7.8	)		(24.5	)		22.1		(18.9	)		(32.4	)
Sales of systems total (in units)		55			50			39		37			25
ASP of system sales (EUR million)		15.2			16.4			18.6		16.0			15.2
Value of backlog systems total (EUR million)		1,697			1,167			1,106		1,028			755
Backlog systems total (in units)		89			65			59		53			41
ASP of backlog systems (EUR million)		19.1			18.0			18.8		19.4			18.4
Value of booked systems total (EUR million)		803			312			632		498			127
Net bookings total (in units)		54			26			33		31			13
ASP of booked systems (EUR million)		14.9			12.0			19.2		16.1			9.8
Number of payroll employees		6,582			6,765			6,821		6,907			6,930
Number of temporary employees		1,725			1,686			1,649		1,610			1,329

ASML — Summary U.S. GAAP Consolidated Balance Sheets^1,4

	Dec 31,		Mar 30,		Jun 29,		Sep 28,		Dec 31,
(in millions EUR)	2007		2008		2008		2008		2008
ASSETS
Cash and cash equivalents		1,271.6		1,397.1		1,360.9		1,313.0		1,109.2
Accounts receivable, net		638.0		741.5		516.9		543.5		469.5
Current tax assets		—		—		—		—		87.6
Inventories, net		1,102.2		1,152.0		1,130.2		1,134.0		999.1
Deferred tax assets, short-term		78.4		71.1		69.8		82.8		71.8
Other current assets		234.5		267.6		262.2		261.4		236.1
Total current assets		3,324.7		3,629.3		3,340.0		3,334.7		2,973.3
Deferred tax assets		141.0		135.8		157.7		139.4		148.1
Other assets		60.0		85.7		39.3		81.3		119.2
Goodwill		128.3		119.7		119.8		129.2		131.5
Other intangible assets, net		38.2		32.5		30.1		28.8		26.7
Property, plant and equipment, net		380.9		401.4		458.1		503.1		540.6
Total assets		4,073.1		4,404.4		4,145.0		4,216.5		3,939.4
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities		1,326.8		1,562.3		1,247.3		1,273.0		1,051.4
Long-term debt		602.0		615.3		591.6		596.7		647.1
Deferred tax liabilities		245.4		261.5		227.0		215.2		209.7
Provisions, long-term		—		—		—		—		15.5
Other liabilities		7.9		7.1		18.5		8.8		26.9
Total liabilities		2,182.1		2,446.2		2,084.4		2,093.7		1,950.6
Shareholders’ equity		1,891.0		1,958.2		2,060.6		2,122.8		1,988.8
Total liabilities and shareholders’ equity		4,073.1		4,404.4		4,145.0		4,216.5		3,939.4

ASML — Summary U.S. GAAP Consolidated Statements of Cash Flows^1,4

	Three months ended,
	Dec 31,			Mar 30,			Jun 29,			Sep 28,			Dec 31,
(in millions EUR)	2007			2008			2008			2008			2008
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)		192.5			145.1			192.0			73.3			(88.0	)
Depreciation and amortization		29.0			29.0			26.5			28.6			36.3
Impairment charges		0.9			1.5			0.1			0.6			20.5
Loss on disposals of property, plant and equipment		1.6			1.1			1.3			1.4			1.6
Share-based payments		6.2			3.6			3.1			3.7			3.2
Allowance for doubtful debts		(1.9	)		0.5			(0.6	)		(0.2	)		0.2
Allowance for obsolete inventory		29.0			20.8			11.8			21.3			85.8
Deferred income taxes		46.2			20.6			(54.5	)		2.4			(2.7	)
Income taxes payable		(38.5	)		1.2			(59.7	)		(8.4	)		(91.5	)
Change in assets and liabilities		(185.1	)		43.9			10.0			(101.8	)		(102.8	)
Net cash provided by (used in) operating activities		79.9			267.3			130.0			20.9			(137.4	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment		(54.0	)		(55.0	)		(65.5	)		(68.3	)		(71.1	)
Proceeds from sale of property, plant and equipment		1.7			—			—			—			—
Net cash used in investing activities		(52.3	)		(55.0	)		(65.5	)		(68.3	)		(71.1	)
CASH FLOWS FROM FINANCING ACTIVITIES
Capital repayment		(1,011.9	)		—			—			—			—
Purchase of shares in conjunction with conversion rights of bond holders and stock options		(203.6	)		(87.6	)		—			—			—
Dividend paid		—			—			(107.4	)		(0.4	)		—
Net proceeds from issuance of shares and stock options		22.8			3.0			0.5			1.4			6.5
Excess tax benefits (deficiencies) from stock options		1.9			—			6.0			(1.9	)		(1.9	)
Redemption and/or repayment of debt		(7.8	)		—			—			(1.3	)		(1.1	)
Net cash provided by (used in) financing activities		(1,198.6	)		(84.6	)		(100.9	)		(2.2	)		3.5
Net cash flows		(1,171.0	)		127.7			(36.4	)		(49.6	)		(205.0	)
Effect of changes in exchange rates on cash		(2.6	)		(2.2	)		0.2			1.7			1.2
Net increase (decrease) in cash & cash equivalents		(1,173.6	)		125.5			(36.2	)		(47.9	)		(203.8	)

ASML — Notes to the Summary U.S. GAAP Consolidated Financial Statements

Basis of Presentation

ASML follows accounting principles generally accepted in the United States of America (“U.S. GAAP”). Further disclosures, as required under U.S. GAAP in annual reports, are not included in the summary consolidated financial statements. Unless stated otherwise, the accompanying consolidated financial statements are stated in thousands of euros (‘EUR’).

Principles of consolidation

The consolidated financial statements include the accounts of ASML Holding N.V. and all of its majority-owned subsidiaries. Subsidiaries are all entities over which ASML has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. All intercompany profits, balances and transactions have been eliminated in the consolidation.

Use of estimates

The preparation of ASML’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities on the balance sheet dates and the reported amounts of revenue and expense during the reported periods. Actual results could differ from those estimates.

Recognition of revenues

ASML recognizes revenue when all four revenue recognition criteria are met: persuasive evidence of an arrangement exists; delivery has occurred or services have been rendered; seller’s price to the buyer is fixed or determinable; and collectibility is reasonably assured. At ASML, this policy generally results in revenue recognition from the sale of a system upon shipment. The revenue from the installation of a system is generally recognized upon completion of that installation at the customer site. Each system undergoes, prior to shipment, a “Factory Acceptance Test” in ASML’s clean room facilities, effectively replicating the operating conditions that will be present on the customer’s site, in order to verify whether the system will meet its standard specifications and any additional technical and performance criteria agreed with the customer. A system is shipped, and revenue recognized, only after all specifications are met and customer sign-off is received or waived. Although each system’s performance is re-tested upon installation at the customer’s site, ASML has never failed to successfully complete installation of a system at a customer’s premises.

For arrangements containing multiple elements, the revenue relating to the undelivered elements is deferred at estimated fair value until delivery of these elements. Revenue from installation services and service contracts provided to our customers is initially deferred and is recognized when the installation is completed and, in case of service contracts, over the life of those contracts. Revenue from extended and enhanced warranties is recognized in income on a straight-line basis over the contract period. The costs of providing services under extended and enhanced warranties are recognized when they occur.

ASML — Reconciliation U.S. GAAP — IFRS^1,4

Net income

	Three months ended,						Twelve months ended,
(in thousands EUR)	Dec 31, 2007			Dec 31, 2008			Dec 31, 2007			Dec 31, 2008
Net income under U.S. GAAP		192,542			(88,024	)		671,001			322,370
Share-based payments (see Note 1)		(875	)		447			(582	)		(2,562	)
Capitalization of development costs (see Note 2)		20,513			7,219			50,089			62,416
Convertible subordinated notes (see Note 3)		—			—			(6,661	)		—
Income taxes (see Note 4)		8,852			(2,279	)		1,204			(5,360	)
Net income under IFRS		221,032			(82,637	)		715,051			376,864

Shareholders’ equity

	Dec 31,		Mar 30,			Jun 29,			Sep 28,			Dec 31,
(in thousands EUR)	2007		2008			2008			2008			2008
Shareholders’ equity under U.S. GAAP		1,891,004		1,958,159			2,060,575			2,122,848			1,988,769
Share-based payments (see Note 1)		787		(3,420	)		(3,266	)		(7,904	)		(6,539	)
Capitalization of development costs (see Note 2)		138,424		157,900			176,818			193,780			201,717
Income taxes (see Note 4)		8,852		9,186			8,478			5,969			4,794
Shareholders’ equity under IFRS		2,039,067		2,121,825			2,242,605			2,314,693			2,188,741

Notes to the reconciliation from U.S. GAAP to IFRS

Note 1 Share-based Payments

Under IFRS, ASML applies IFRS 2, “Share-based Payments” beginning from January 1, 2004. In accordance with IFRS 2, ASML records as an expense the fair value of its share-based payments with respect to stock options granted to its employees after November 7, 2002.

Under U.S. GAAP, ASML applies SFAS No. 123(R) “Share-Based Payment” which is a revision of SFAS No.123. SFAS 123(R) requires companies to recognize the cost of employee services received in exchange for awards of equity instruments based upon the grant-date fair value of those instruments.

Note 2 Capitalization of development costs

Under IFRS, ASML applies IAS 38, “Intangible Assets”. In accordance with IAS 38, capitalized development expenditures are amortized over the expected useful life of the related product generally ranging between 2 and 3 years. Amortization starts when the developed product is ready for volume production.

Under U.S. GAAP, ASML applies SFAS No. 2, “Accounting for Research and Development Costs”. In accordance with SFAS No. 2, ASML charges costs relating to research and development to operating expense as incurred.

Note 3 Convertible Subordinated Notes

Under IFRS, ASML applies IAS 32 “Financial instruments: Disclosure and presentation” and IAS 39 “Financial instruments: Recognition and measurement” beginning from January 1, 2005. In accordance with IAS 32 and IAS 39, ASML accounts separately for the equity and liability component of its convertible notes (“Split accounting”). The equity component relates to the grant of a conversion option to shares to the holder of the bond. Split accounting results in additional interest charges.

Under U.S. GAAP, ASML accounts for its convertible bonds as a liability at the principal amount outstanding. As of December 31, 2007 ASML has no Convertible Subordinated Notes outstanding.

Note 4 Income taxes

Under IFRS, ASML applies IAS 12, “Income Taxes” beginning from January 1, 2005. In accordance with IAS 12, unrealized net income resulting from intercompany transactions that is eliminated from the carrying amount of assets on consolidation gives rise to a temporary difference for which deferred taxes must be recognized on consolidation. The deferred taxes are calculated based on the tax rate applicable in the purchaser’s tax jurisdiction.

Under U.S. GAAP, the elimination of unrealized net income from intercompany transactions that are eliminated from the carrying amount of assets on consolidation, give rise to a temporary difference for which prepaid taxes must be recognized on consolidation. Contrary to IFRS, the prepaid taxes under U.S. GAAP are calculated based on the tax rate applicable in the seller’s tax jurisdiction.

“Safe Harbor” Statement under the US Private Securities Litigation Reform Act of 1995: the matters discussed in this document may include forward-looking statements, including statements made about our outlook, realization of backlog, IC unit demand, financial results, average sales price, gross margin and expenses. These forward looking statements are subject to risks and uncertainties including, but not limited to: economic conditions, product demand and semiconductor equipment industry capacity, worldwide demand and manufacturing capacity utilization for semiconductors (the principal product of our customer base), including the impact of credit market deterioration on consumer confidence and demand for our customers’ products, competitive products and pricing, manufacturing efficiencies, new product development and customer acceptance of new products, ability to enforce patents and protect intellectual property rights, the outcome of intellectual property litigation, availability of raw materials and critical manufacturing equipment, trade environment, changes in exchange rates and other risks indicated in the risk factors included in ASML’s Annual Report on Form 20-F and other filings with the US Securities and Exchange Commission.

1	All quarterly information in this press release is unaudited.
2	The calculation of diluted net income per ordinary share assumes conversion of our Subordinated Notes as such conversions would have a dilutive effect.
3	The calculation of diluted net income per ordinary share assumes the exercise of options issued under ASML stock option plans as such exercises would have a dilutive effect.
4	As of January 1, 2008 ASML accounts for award credits offered to its customers as part of a volume purchase agreement using the deferred revenue model. Until December 31, 2007 the cost accrual method was used. This change in accounting policy was made because the deferred revenue model better reflects the business rationale. In addition the International Financial Reporting Interpretation Committee concludes in interpretation 13 (IFRIC 13 “Customer Loyalty Programmes”) that the deferred revenue model is the appropriate accounting treatment. Comparative figures for 2007 were adjusted to reflect this change in accounting policy. The impact of this change on equity as per January 1, 2007 amounted to EUR 8.5 million (decrease) and on net income for the year 2007 and the first quarter of 2008 amounted to EUR 8.2 million (decrease) and EUR 0.1 million (increase) respectively.