Avino Silver & Gold Mines Ltd.

Good afternoon. This is the Coral School Conference operator. Welcome and thank you for joining the ASM International third quarter 2024 earnings call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Victor Vareno, How to Investor Relations. Please go ahead, sir.

Thank you, operator. Good afternoon and welcome everyone to our Q3 earnings call. I'm joined here today by our CEO, Richie Massad, and our CFO, Paul Verheyen. ASM issued its third quarter 2024 results yesterday at 6 p.m. Central European time. For those of you who have not yet seen the press release, it is available on our website, along with our latest investor presentations. As always, we remind you that this conference call may contain information related to ASM's future business and results, in addition to historical information. For more information on the risk factors related to such forward-looking statements, please refer to our company's press releases and financial reports, which are available on our website. Please further note that reference in this call to profitability numbers will be primarily on an adjusted basis. Details of the acquisition-related PPA expenses can be found in the press release and in the investor presentation. And with that, I will now hand the call over to Hicham Massad, CEO of ASM. Thank you, Victor, and thanks to everyone for attending our third quarter 2024 earnings call. The agenda for today's call is as usual. Paul will first review our third quarter financial results. I will continue with the discussion of the market trends and the outlook, followed by Q&A.

Thank you, HM, and thanks everyone for joining the call. In this third quarter of 2024, our revenue increased to a new quarterly high of €779 million and 26% at constant curve compared to the third quarter of last year. Revenue in the quarter was at the upper end of our guidance of 740 to 780 million euro. Spares and service sales grew by 45% year-on-year at constant currencies. This growth was above trend, including stronger than expected demand from China, and with a relatively strong quarter for our outcome-based services. In Q4, we expect growth to return to a more normal level again. Equipment revenue in the third quarter increased 22% of constant currencies year-on-year and was led by our ALD product line, which accounted for the majority of our equipment sales. By customer segment, revenue in the third quarter was led by memory, followed by foundry, and then logic. Combined logic foundry continued to account for the largest part of revenue and decreased slightly both year-on-year and compared to Q2. Gate all around had again a solid and increased Memory sales continued to grow significantly following the strong order intake in the previous quarter. Memory sales consisted mostly of high bandwidth memory-related DRAM applications, which grew sharply. 3D NAND sales grew strongly versus the low level in the third quarter last year and were stable compared to Q2 and represent the smaller part of our memory sales. Sales in the power analog wafer segments were fairly stable compared to the second quarter. Year-to-date, sales in this segment are down by a significant double-digit percentage. This is compared to the very strong level last year and reflecting the soft demand and inventory corrections in the industrial and automotive end markets. Moving on to the gross margin. In the third quarter, gross margin came at 49.4%, up from 48.9% in Q3-23, explained by mixed effects, including increased sales year-on-year from China which was somewhat higher than expected. For H2, we expect China sales to be below H1 sales as stated before. SG&A expenses increased 1% year-on-year, reflecting our ongoing focus on cost control. For the full year, we expect SG&A to be slightly up compared to 23, excluding the incidental charge of $8.4 million in the second quarter. Net R&D expenses increased by 36% year-on-year and 16% compared to the second quarter, driven by headcount growth as well as higher amortization charges and lower capitalization. As indicated in previous quarters, several development projects are entering the commercial release phase this year, which means amortization of the related capitalized development expenses has started. Also in relation to the completion of these projects, Capitalized development expenses decreased in Q3 because some resources previously allocated to those projects are now being used for a number of months to support the commercial release and must therefore be expensed instead of capitalized. Before, we expect net R&D expense to increase between 15% and 20%. We also booked a one-off gain of €7 million on the divestment of a building in Singapore, recognized as a separate line item other income and not included in operating expense. Including this one-off gain, operating profit margin increased to 28.2% in Q3, up from 25.3% in the same period last year. The one-off gain of €7 million had a positive impact of 0.9% on the operating margin. Below the operating line, results included the currency translation loss of 48 million euro in Q3. This compared to a gain of 16 million euro in Q2 and a gain of 3 million euro in Q3 of last year. These translation results mainly relate to our cash position, which we hold for the largest part in US dollars. Results from investments, which reflect our 25% share of the net earnings from ASMPT decreased €0.7 million in the third quarter, down from €4 million in Q2 and slightly up from €0.4 million in Q3 of last year. Asian PT results were impacted by the continued downturn in the back-end equipment markets. Let's now turn to Asian order intake. In the third quarter, our new orders increased to a strong level of €815 million, up 30% year-on-year at constant currencies. In terms of customer segments, foundry was the largest segment in the third quarter, followed by memory and then logic. Combined logic foundry accounted for more than half of equipment bookings and were up compared to the second quarter. Gate all-around orders were again solid and increased sequentially, with most of the tool orders now for high-volume manufacturing. Mature logic foundry orders were also up sequentially but down compared to last. Memory orders slightly decreased compared to the second quarter, but were still at a very strong level. DRAM orders were roughly similar to the strong level in the second quarter, and again driven by high demand for high-benefit memory applications. 3D NAND orders decreased slightly compared to the second quarter, and were still at a fairly modest level compared to our DRAM orders. Orders in the power analog wafer remained at low level in Q3. Bookings from China dropped somewhat, both year on year and compared to Q2, but were still slightly higher than we anticipated at the start of the quarter. The balance sheet. We ended the quarter with 747 million in cash, up from 637 million the previous quarter. This increase was largely the balance of a very strong free cash flow of 242 million euro in the quarter, partly offset by cash spent on share buybacks. Next to the increased profitability, the free cash flow was primarily driven by lower working capital in the quarter. Days of working capital decreased to a relatively low level of 48 days, down from 64 days at the end of June. Working capital fluctuates from quarter to quarter, and in Q4 we expected to be back in the target range of 55 to 75 days. We spent 13 million euro on capex during the third quarter. Furthermore, we spent 93 million euro on share buybacks during the third quarter. On July 25th, we completed the 150 million euro buyback program that we started last May. Combined with the dividend paid earlier this year, we returned a total of 287 million in cash to our shareholders this year, up from 223 million last year. And with that, I hand the call back to Hisham.