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Note 24. Disclosures about segments and related information

The Company organizes its activities in two operating segments, Front-end and Back-end. Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Executive Officer ('CEO'), which is the chief operating decision maker.

The Front-end segment manufactures and sells equipment used in wafer processing, encompassing the fabrication steps in which silicon wafers are layered with semiconductor devices. The segment is a product driven organizational unit comprised of manufacturing, service, and sales operations in Europe, the United States, Japan, South Korea and Southeast Asia.

The Back-end segment manufactures and sells equipment and materials used in assembly and packaging, encompassing the processes in which silicon wafers are separated into individual circuits and subsequently assembled, packaged and tested. The segment is organized in ASM Pacific Technology Ltd, in which the Company holds a substantial share of 39.75% interest, whilst the remaining shares are listed on the Stock Exchange of Hong Kong. The segment’s main operations are located in Hong Kong, the People’s Republic of China, Singapore, Malaysia and Germany.

The Back-end segment remains reported as a separate segment since the cease of control per March 15, 2013. Since that date the segment is reported as an equity method investment as the CEO reviews this information as part of his CODM package.

Accordingly, the asset and profit/loss information regarding the operations that comprise the segment are disclosed. The full financial results are reviewed by the CODM, the external reporting of the segment are on an equity method investment basis. The total of all segments' financial amounts are reconciled to the corresponding amounts reported in the consolidated financial statements, eliminations are reflected in the reconciling column for amounts reported in excess of those amounts reflected in the consolidated financial statements.

Segment performance is evaluated by the Company's management based on US GAAP net earnings or loss which in certain respect is measured differently from net income or loss reported by the Company in its consolidated financial statements, which are based on IFRS, as adopted by the EU. For a reconciliation between IFRS and US GAAP see Note 31.

Year ended December 31, 2013
Front-endBack-end 100%Deconsolidated and discontinuedReconciliation from US GAAP to IFRSTotal
Net sales to unaffiliated customers451,9911,051,376(1,051,376)451,991
Gross profit176,160307,618(307,618)(8)176,152
Result from operations44,70466,352(66,352)21744,921
Interest income904272(272)904
Interest expense(2,553)(2,082)2,082459(2,094)
Foreign currency exchange gains (losses), net(9,004)847(847)(9,004)
Result from investments(377,863)9,532(368,331)
Income tax expense(9,484)(11,308)11,308574(8,910)
Net earnings discontinued operations1,402,5961,402,596
Net earnings (loss)24,56554,081970,65410,7821,060,082
Allocation of net earnings (loss)
Shareholders of the parent1,062,675
Non-controlling interest(2,593)
Capital expenditures and purchase of intangible assets11,07234,003(34,003)(21,848)(10,776)
Depreciation and amortization19,41541,066(41,066)10,41629,831
Cash and cash equivalents312,437149,313(149,313)312,437
Capitalized goodwill11,421(949)10,472
Other intangible assets5,637902(902)55,59261,229
Investments and associates278943,675943,953
Other identifiable assets277,800599,709(599,709)1,201279,001
Total assets607,573749,924193,75256,1141,607,363
Total debt65,105(65,105)
Headcount in full-time equivalents 11,50314,400(14,400)1,503
  1. Headcount includes those employees with a fixed contract, and is exclusive of temporary workers.
Year ended December 31, 2014
Front-endBack-end 100%DiscontinuedReconciliation from US GAAP to IFRSTotal
Net sales to unaffiliated customers545,6041,386,776(1,386,776)545,604
Gross profit234,999492,137(492,137)279235,278
Result from operations90,535209,439(209,439)2,83993,374
Interest income1,5831,583
Interest expense(2,312)(11,745)11,745(960)(3,272)
Foreign currency exchange gains (losses), net26,43926,439
Result on investments and associates(278)38,91078139,413
Income tax expense(17,569)(43,728)43,728(1,808)(19,377)
Net earnings discontinued operations3,1573,157
Net earnings (loss)98,398153,966(115,056)4,009141,317
Capital expenditures and purchase of intangible assets39,67830,992(30,992)14,34654,024
Depreciation and amortization21,22240,416(40,416)11,78633,008
Cash and cash equivalents385,777275,431(275,431)385,777
Capitalized goodwill12,10443,076(43,076)(949)11,155
Other intangible assets3,96066,617(66,617)61,25465,214
Investments and associates1,092,0978511,092,948
Other identifiable assets332,995755,106(755,106)1,081334,076
Total assets734,8361,140,230(48,133)62,2371,889,170
Total debt247,608(247,608)
Headcount in full-time equivalents 11,63515,946(15,946)1,635
  1. Headcount includes those employees with a fixed contract, and is exclusive of temporary workers.

There are no inter-segment transactions, other than charges for management services, which are based on actual cost. The accounting policies used to measure the net earnings and total assets in each segment are consistent to those used in the Consolidated financial statements. The measurement methods used to determine reported segment earnings are consistently applied for all periods presented. There were no asymmetrical allocations to segments.

Geographical information is summarized as follows:

EuropeUnited States of AmericaJapanSouth KoreaTaiwanOther AsiaCorporateConsolidated
Year ended December 31, 2013
Net sales73,110131,20933,772110,55978,20425,137451,991
Long-lived assets2,87124,42915,1123,8686310,1444456,531
Year ended December 31, 2014
Net sales94,518177,00662,48293,59581,14336,860545,604
Long-lived assets6,76233,88115,59811,6675111,2532479,236

Long-lived assets for the years ended December 31, 2012, 2013 and 2014 consist of the Company’s property, plant and equipment.

For geographical reporting, net sales are attributed to the geographic location in which the customer's facilities are located.

Welcome to our 2014 Corporate reporting site

ASMI has a dual listing on Nasdaq (North America) and Euronext (the Netherlands). Our full 2014 Annual report is prepared in accordance with International Financial Reporting Standards ('IFRS'), as endorsed by the European Union and can be viewed online conveniently. We also file the Annual report on Form 20-F with the US Securities and Exchange Commission, which is available as a PDF. All our 2014 reports can be downloaded quickly and easily.

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STATUTORY
ANNUAL REPORT 2014

Our Statutory annual report provides a comprehensive overview of company developments in 2014. It has been prepared in accordance with International Financial Reporting Standards ('IFRS') as endorsed by the European Union.

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ANNUAL REPORT ON
FORM 20-F 2014

Form 20-F 2014, which is compiled based on US GAAP, has been filed with the Securities and Exchange Commission. It may contain information additional to the Statutory annual report.

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CR REPORT
2014

Our goal is to create better products and add value to the company, our stakeholders and society at large in a responsible, sustainable manner. Our CS report covers all aspects of our efforts to manage our business responsibly.

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REMUNERATION
REPORT 2014

The Remuneration report 2014 provides a breakdown
of our Management Board and Supervisory Board remuneration.

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RECONCILIATION
US GAAP-IFRS 2014

With dual listing in North America and the Netherlands, we report in US GAAP and IFRS. This document outlines the main differences for ASMI relating to US GAAP and IFRS.

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