Guido Pickert – Director-Investor Relations & Communications Martin Goetzeler – President, Chairman-Management Board & CEO Wolfgang Breme – Chief Financial Officer & Executive Vice President

Sumant Wahi – Redburn Ltd. Chetan Udeshi – JPMorgan Securities PlC Tammy Qiu – Joh. Berenberg, Gossler & Co. Jed E. Dorsheimer – Canaccord Genuity, Inc. Janardan N. Menon – Liberum Capital Ltd. Jürgen Wagner – MainFirst Youssef Essaegh – Barclays Capital Securities Ltd. Christian Rath – HSBC Trinkaus & Burkhardt AG Thomas M. Becker – Commerzbank AG Malte Schaumann – Warburg Research Patrick J. Ho – Stifel, Nicolaus & Co. Andrew Huang – Sterne, Agee & Leach, Inc.

Ladies and gentlemen, welcome to AIXTRON’s Q1 2014 Results Conference Call. Please note that today’s call is being recorded. Let me now hand you over to Mr. Guido Pickert, Director of Investor Relations at AIXTRON, for opening remarks and introductions.

Thank you, Operator. Let me start by welcoming you all to the Q1 2014 results call of AIXTRON SE. Thank you for attending today’s call. My name is Guido Pickert, Director of Investor Relations and Corporate Communications at AIXTRON SE. I would like to welcome our President and CEO, Martin Goetzeler, as well as our Executive Vice President and CFO, Wolfgang Breme. As the operator indicated, this call is being recorded by AIXTRON and is considered copyright material. As such, it cannot be recorded or rebroadcast without expressed permission. Your participation in this call implies your consent to this recording. As with previous conference calls, I trust that all participants have our results presentation slides, page two of which contains the usual Safe Harbor statement. I will therefore not read it out loud, but would like to point out that it applies throughout this conference call. You may also wish to have a look at our latest IR presentation, which includes additional information on AIXTRON’s markets and its technologies, and is available on our website. Additionally, you may also wish to have a look at our interactive Annual Report 2013, it offers additional services such as a quick analyzer for key figures or a download center in which you can compose your individual PDF report or download financial tables in Excel format. This call is not being immediately presented via webcast or any other medium. However, we will place an audio file of the recording or a transcript on our website after the call. I would now like to hand you over to Martin Goetzeler, AIXTRON’s President and CEO, for opening remarks. Martin?

Thank you, Guido. And thank you all for joining the AIXTRON 2014 first quarter results conference call. Let me start by making some general comments before handing over to Wolfgang, who will go into the greater depth on the finances. I will then wrap up with our near-term outlook. During our 2013 annual results call on February 21, we shared with you our expectation that the major short-term driver for our business would be the speed of adoption of LEDs within general lighting. We also expressed our view that the faster that adoption, the quicker LED producers would have to expand production and acquire MOCVD equipment from the lights of ourselves. We also stated that due to our limited order visibility, it was very difficult for us to predict the exact timing and extent of such a pickup. The good news is that the adoption of LEDs for general lighting purposes is gaining further momentum. Having been at Light+Building in Frankfurt and talking to many industry players, it is clear that LED will be the dominating light source in the near future. Basically almost all newly developed fixtures are equipped with semiconductor based light sources. And there are further signs that we have seen the bottom of the current LED equipment cycle. For a start, sentiment among customers is improving a strong growth in the LED market for general lighting price-demand and at the same time profitability is improving. As you can see on slide three, we generated €43.9 million in revenues in Q1, which is 9% above the same quarter last year. The slight in positive was order intake, which came in at €37.7 million in Q1, which was the highest level achieved on a quarterly basis in over two years. Backlog, increased by 10% to €64.2 million compared to the 2014 opening backlog of €58.1 million. But I do caution that revenues and orders are still at low level. In terms of profitability, we generated an operating loss in Q1, 2014, of minus €10.9 million, which was lower sequentially and year-on-year was €12.6 million in Q4 and minus €76.3 million in Q1, 2013. Of course, we’re continuing to implement the 5-Point-Program. We initiated a year ago, which will provide the basis for return to sustainable profitability for AIXTRON. For now, let me hand you over to Wolfgang for a more detailed overview of our Q1, 2014 results.

Thank you, Martin, and hello to everyone on the call. Let me start with our income statement on Slide 4. On a quarterly basis, revenues for Q1 came in at €43.9 million, which was slightly below the €51.1 million we generated in the previous quarter, but 9% above the €40.2 million we achieved in the same period last year. Equipment revenues for the first quarter of this year was €32.1 million, representing 73% of total revenues with the remaining 27% coming from spares and service. This breakdown of revenues was similar to the first quarter last year. The largest market for our equipment is LEDs, which comprised 73% of revenues in Q1. The next largest market is silicon equipment for the production of DRAM memory chip. On a regional basis, 79% of total revenues in the first three months of 2014 were generated by sales to customers in Asia, with Europe representing 17%, and the United States 4%. On the earning side, the net result for the first quarter was a loss of €11.8 million, which is an improvement on the €76 million loss generated during the same quarter in 2013, and the €14.8 million loss for the previous quarter. These losses are directly related to the low sales volumes, particularly in our core market for LED manufacturing equipment. Gross profit in Q1 amounted to €10.8 million which represents a 25% gross margin. That is much improved over the same quarter last year when our gross margin was negative due to inventory write-down and other restructuring costs. Q1 gross margin, however, is impacted by a less favorable product mix. Operating cost for the first three months of 2014, a €21.7 million were down 24% on the same quarter last year. This is largely a reflection of our cost optimization program, which we launched as part of our 5-Point-Program plan and can be seen more clearly in the various line items. Selling expenses for Q1 decreased year-on-year by 43% to €3.9 million. At the same time, general and admin expenses fell by 6% to €5.1 million, while R&D cost dropped by 17% to €13.7 million. This ongoing cost optimization program means that we have significantly lowered our fixed cost base. Before going to the balance sheet, let me say something about order intake. Q1 orders came in at €37.7 million, which was slightly ahead of the previous quarter’s €37.1 million, but substantially ahead of the same quarter last year, when orders were €29.9 million. This is the fourth quarter of sequential growth in orders, which is a good sign for the future. Our order backlog at the end of Q1 was €64.2 million, which was 10% higher than the start of this year, which was €58.1 million. Let’s now move to the next slide, which shows our balance sheet. Despite the weak results, AIXTRON still has a strong balance sheet with no financial debt and equity ratio of 82%, and cash and cash equivalents, including cash deposits totaling €292 million. Of this amount, €159 million was invested in other financial assets, which is cash on deposits with the maturity of more than 90 days. Our cash position is down slightly from the end of last year; the last year’s €306.3 million and it’s a reflection of our operating losses in the first quarter, as well as tax and restructure related payments accrued in 2013, which is also reflected in our free cash flow of minus €13.8 million. There has been no other material changes in the balance sheet since year-end. Total current assets at €152.8 million, a very similar trend to the €152.7 million from the end of 2013. Current liabilities increased over the same period, but only slightly from €95.4 million to €97.8 million. The most notable change within this category was trade payables, which increased from €13.5 million to €17.1 million over the last three months, reflecting additional R&D and working process requirements. In summary, we remained well-positioned with a strong balance sheet and an increasingly robust and flexible operating business. We will remain vigilant in terms of our working capital going forward and we will continue to optimize our operating costs. With that, let me pass it back to Martin.

Thank you, Wolfgang. As I said earlier, we are seeing a slight pick-up in demand for equipment from LED manufacturers, but that pick-up is not strong enough for us to change our guidance for 2014. The last few years have been tough for AIXTRON, but I’m confident that we will emerge from this down-cycle in a stronger position than when we went in. There are two reasons for this. First and foremost, AIXTRON has a solid and well-designed technology offering and a strong local footprint in all of our customer markets. Secondly, the implementation of our 5-Point-Program with its focus on customer benefit, better utilization of our technology and product portfolio, process improvement, attention to clearly defined financial targets, and the strengthening of AIXTRON’s management and corporate culture, means that we are better able to meet the opportunities and challenges that come our way. AIXTRON’s most immediate growth opportunities in LEDs and it is starting to feel as if another tipping point for LED adoption within general lighting is imminent. Prices of LEDs have halved over the last 24 months and 60 watts replacements bulbs are now available at reasonable prices in most major markets. In Germany, are some 60 watt equivalence are selling for as low as €9.99, and in the U.S., Home Depot is currently selling a 60 watt Cree replacement LED below $10, and market research firms assuming enormous growth in the LED market in the coming years. According to the market research firm IHS from December 2013, the market for general lighting LEDs is expected to grow from €495 million shipped units in 2013 to €3.6 billion shipped units in 2020. The consultancy firm McKinsey estimates that by 2016, nearly half of the world’s spending on lighting will be on LED luminance. Let me emphasize that AIXTRON has solid relationships into key LED suppliers and that we will launch our next-generation LED – MOCVD solution in the second half of this year, representing a very competitive technology offering. We not only believe that AIXTRON is well positioned in LEDs, but also thanks to our continuing investment in R&D that we also have a sustainable opportunities in the silicon and organic semiconductor technologies, as well as in compound semiconductors, for example, for power electronics. As Wolfgang mentioned, we have a solid balance sheet with no debt and €292 million in cash at the end of Q1, as well as a robust business model, which will allow us to become profitable as equipment and spares demand volumes reach €250 million or more. Ladies and gentlemen, we continue to execute on our strategy and are confident in the positioning of the company in its various target markets. We do, however, recognize the risk in the market, thus we will remain focused on increasing our process efficiencies and on tightly managing the cost in line with our 5-Point-Program. Those measures are part of our road map to return to sustainable profitability. With that, I’ll pass it back to Guido before we take some questions.

Thank you, Martin and Wolfgang. Before we take the questions, I could ask everyone again to limit your questions to maximum of two each time. This will allow everyone to have a – a chance to have their questions answered. Thank you. Operator, we will now take the questions.

Thank you, gentlemen. Let me now open the conference call for the Q&A session. (Operator Instructions) And the first question comes from Sumant Wahi from Redburn. May we have your question please? Sumant Wahi – Redburn Ltd.: Hi, gentlemen, good afternoon. Thanks for taking my question. I just had two quick ones. One, I suppose I’m just trying to understand the sort of reasoning behind introducing a new tool in the second half of this year. I’m just wondering, whether – I mean, previously you haven’t done so because – or my read has been that the market hasn’t been strong enough, so there is no point in introducing a new tool. Should we see this as a sign of you assuming or being more optimistic about demand into the second half of this year? And then I have a quick follow-up, which is increasingly the discussion at least has been around the manufacturing capability of Chinese and Taiwanese customers of yours. And I’m just wondering, what is your latest view on in terms of the knowledge base of these customers comparing them to the Koreans and the Europeans? In essence, what I’m trying to understand is, has that reduced your addressable market to a certain extent because of the over capacity there or not?

Okay. Thanks for your questions. First of all on this new tool, you know this to introduce a new tool is quite a process, it takes a couple of years, so the plan for introducing a new is not really related to any cycle in certain industries, in our case, it’s not related right now to this lighting cycle. It was basically decided couple of years ago. And that was not exactly clear when the lighting cycle will pick-up. So it’s not really – this is not related, so it’s a long-term decision or medium-term decision to come up with a new tool. And in the past basically, we can say, every four years basically we came out with a new tool. The second question, I wasn’t – I’m not quite sure what your question really was about, because you – on one side you focused on the capabilities and then at the end you ended up with the capacity. So I wasn’t so sure if I got the question really right. I will try to answer that from a capability point of view. My impression is when I visit these customers and also talk to the industry players that the gap between the Chinese players and also the leaders in this industry is closing. I think it’s not closed yet, but it’s closing, and therefore, there is still a gap, but it’s reducing and it’s coming down year-by-year. Sumant Wahi – Redburn Ltd.: I guess, the reasoning of that question is that if there is –Chinese customers are still further away from – then the overcapacity, which was built in China and Taiwan probably wouldn’t be material from an LED lighting perspective. But if they are closing the gap, I’m assuming that the peak of demand you could see in terms of your tools would actually reduce, because the overcapacity in China would start getting utilized for LED lighting specifically rather than medium brightness LED’s.

I would answer that question. The capacity in China which is today for LED production is growingly also used for LED lighting. There is no question that the growth today in China or in the capacity utilization primarily comes from the lighting. And as you know, many of the downstream products also in the lighting area are produced in China. So lot of the LEDs for these – the chips for these fixtures and also lamps also come from China. So that has clearly an implication and then there we see a relationship. Sumant Wahi – Redburn Ltd.: Thank you.

The next question comes from Chetan Udeshi from JPMorgan. May we have your question please? Chetan Udeshi – JPMorgan Securities PlC: Yeah, hi. Thanks for taking my question. I just wanted to understand, you do sound incrementally more positive in the same category. You are saying that things are improving incrementally. I mean, compared to last quarter how does that make you feel about a potential improvement in sales and orders over this year? Do you think there is chance that second half could be more stronger than first half, or you think the visibility is still limited on that? I mean, this is specifically related to the LED equipment. And secondly, can you update us on the progress on OLED and also ALD? I mean, one of your peers will not – I mean – and Europe has been reporting strong ALD sales. And I just wanted to understand, how is AIXTRON seeing in terms of ALD market. Thanks.

First of all, I think regarding the question about, what will happen going forward, I think I have made it clear that, we are seeing a slight pick-up in demand for equipment from LED manufacturers. But that pick-up is not strong enough for us to change our guidance for 2014. And if we look at the current situation in the LED lighting, it’s clearly something which we are following very closely. I have, I think, mentioned several times in this call that we – differently to the TV cycle that the lighting cycle we see different, because we will not have – we are not addressing one application, but we are addressing several applications like, for example, street lighting, residential lighting, commercial lighting or architectural lighting. And depending on the different traditional technologies, which were used in the past, inflection points differ by the way also regionally and that’s why we think about several inflection points here. So the question is really – and right now we are basing our thoughts on this model, which was created by McKinsey, which is today our basis. And we are really adjusting it every quarter if we feel that there are changes to this model. And if you look at these different inflection points and some actually inflections already happened like, for example, in the architectural lighting area, then it’s really important to see, do they move closer to each other or are they basically spread our longer cycle. And depending on this basically the demand of MOCVD tools will be, let’s say, a little bit steeper or will be actually smoother and more sustainable. This is the question we have to answer and we are following every quarter. But it’s very difficult for us right now to give a detailed answer. But the other – and I think good news is that the LED lighting cycle or the LED lighting demand will be significantly higher than, for example, for the TV. Your second question regarding the progress on OLED and ALD. Let me first of all touch on OLED. We started over the last couple of months our R&D tool and we are right now in the situation that we do customer demos. We still have also development work, but we are really working very closely with our customer base in order to show the benefits in COO and also in throughput and also throughput time by the way in our tools. And on the other side we are working on Gen8, which really give us major benefits or it gives our customers major benefits by using our technology, which is scaling it up. And here we work also with an automation specialist to create a demo tool to show to the key customers the benefits of the technology. So this is as we speak work-in-progress. And we are in basically continuous contact with the team, but also with the customers in order to see where we are. On the ALD side, I think you know that we focus here on the memory customers in silicon. We are qualified at one customer. And right now, we are still in qualification to other customer’s; one for DRAM and the other one for flash. The cycles here and the investments clearly depend also on investment targets of our customers. Well there can also some ups and downs between the quarters, but in general, I think we are here on the right track. And we are closely working with the customer base. Chetan Udeshi – JPMorgan Securities PlC: Okay. Or maybe one follow-up if I could, on the new tool which you plan to launch in second half, I mean, would it be able for – I mean would you be able to ship that tool in second half or would there be some lead-time between when you launch and when customers evaluate or accept the tool or qualify the tool or have you been sending this tool for qualifications to customer already? Thanks.

Our plans are to ship tools in the second half. Chetan Udeshi – JPMorgan Securities PlC: Thank you.

The next question comes from Tammy Qiu from Berenberg Bank. Please, it’s your turn now. Tammy Qiu – Joh. Berenberg, Gossler & Co.: Hi, thank you for taking my question. So firstly, I will like to understand a little bit about Chinese situation here, because now you’re having Samsung signed agreement with some of the Chinese lighting product vendor. And then you have Samsung working with (indiscernible). So going forward, how do you see in terms of industrial would shape out? Is Chinese will be the foundry of everybody? So therefore, Chinese will be majority of the demand for MOCVD tools? And I have a short follow-up.

I would consider, let’s say, we agree that there will be some major tier 1 players in the market and I will not define right now the region, but I would say there will be a couple also in Greater China, no question. We will have a significant share of the world capacity. So there will be some – as you mentioned, some foundry activity as well in this marketplace, I agree. Tammy Qiu – Joh. Berenberg, Gossler & Co.: And, how specifically into China, how do you think of the Chinese player in sense of shipping their product overseas? Because historically – because of the IT issue they have they can’t really ship that much to overseas but how do you see that going forward?

I would say that what we see right now that many of the players in China also work on this topic and addressing this topic, and therefore, I think there will be also found solution going forward. Tammy Qiu – Joh. Berenberg, Gossler & Co.: Okay, thanks. And also a housekeeping question on your cash balance. Do you have any plan for capital allocation i.e. return more cash for shareholders given your cash balance has accumulated?

I would like to answer that question. We had this capital increase in October and there we clearly stated that this is an – this capital we would like to raise for the future investments in our really key technologies going forward and that’s not just LED but also for power of areas in silicon but also for OLED. And therefore, we are seeing that as a basis for the future growth. And on the other side, if you compare our cash situation with an industry average, I think we are not so far off from the average. So this is something which in the semiconductor industry is quite usual. Tammy Qiu – Joh. Berenberg, Gossler & Co.: Okay. So, if I am not right, correct me. There is no short term plan for extra cash return, right?

Right now this is not planned. Tammy Qiu – Joh. Berenberg, Gossler & Co.: Okay. Thank you very much. That’s all my questions.

The next question comes from Jed Dorsheimer from Canaccord. May we have your question, please? Jed E. Dorsheimer – Canaccord Genuity, Inc.: Yes. Thanks for taking my question. I guess, just around the new tool that you plan to ship in the back-half. In terms of – are you sampling – I guess, my first question is, one, are you sampling with customers beyond a single region? I believe it was based in to China, but I am wondering if you’ve begun sampling outside of China and then I have a follow-up question.

We are sampling right now in Greater China. Jed E. Dorsheimer – Canaccord Genuity, Inc.: Okay. And then, maybe, if you could help us better understand the cost of ownership or the cost structure that this tool may help change for you? One of the challenges as we look at the markets and some of the concerns has been the reduction. I think was roughly 35% reduction in selling prices of your tools in the marketplace whether that was as a result of your doing or your competitors doing? The prices have come down during the last downturn, and so those economics don’t seem to be changing in the market. So I am wondering, as you look at this new tool that you introduced, do you feel confident that the cost structure is such that you can return to sort of a previous cycle’s margin profile for AIXTRON?

Yeah, thank you for that question. These new tools are clearly they have a couple of major advantages. It’s not just about additional capacity; it’s also about throughput cost of ownership in total. And what normally happens when you introduce a new tool, you basically share the benefits of both, of these cost of ownership with your customer base, so at the end of the day, you get a higher price or higher margin and the customer gets the better cost of ownership, so that in total both has a real win-win situation. Jed E. Dorsheimer – Canaccord Genuity, Inc.: Great. Thank you.

The next question comes from Janardan Menon from Liberum. May we have your question, please? Janardan N. Menon – Liberum Capital Ltd.: Yeah, hi, thanks for taking the question. I’m just wondering, we have been waiting for quite a few quarters probably more than quarters running to years waiting for the order pick-up to come our way. Based on your current conversations with customers, what exactly is the kind of reason they are giving currently for not placing the orders or what is your understanding of what they are waiting to see, is it high levels of profitability or is it more confidence in the trajectory of lighting demand, what is the tipping factor? And if you could just qualify that answer by, separately by Korea, Taiwan, China, that will be great, but if not, at least general answer? My second question is just shortfall of – the inventory carrying of the older tools that you were talking about previously, has that completely gone out of the system right now, and if so, will that reflect in any kind of improvement in your gross margin going forward?

Now let me answer the second question first. I think when we introduce a new tool it’s clear that we are – that we from the beginning also work on right design to cost in order to create the right cost margin and in order to get back basically to profitable growth. And that’s one of the focus areas when we introduced new tool. So it’s clear that when you introduce that you continue to work on these kind of cost reduction activities. So that should contribute positively. Secondly, on your question, first of all, I think you remember and I am now going back really the two years when – or three years when we had this up-tick coming from TV and also from the Chinese subsidy program, clearly at that point in time a lot of overcapacity was created. But don’t forget over those eight quarters we also sold. It’s not that we didn’t sell – also our competitors also. We added capacity every quarter but at much lower level, that’s true. And at the same time we had to reduce the overcapacity from those purchases a couple of years ago. What did also happen, what we see is basically that in this cycle 2010-2011, we saw orders of 50 units or even more, currently also because of the station. And maybe, also a little bit to be more cautious customers still order but they don’t order 50 but they order – currently they order more like 4 or 12 units at one time. So it’s at a lower level. Going forward, it’s difficult always to predict what will happen. But I think some customers also look into the new tools. Others are working still on upgrades. So there are many reasons why some investments might not have happened. But we have to see how things are moving over the next year. Janardan N. Menon – Liberum Capital Ltd.: Just on a follow-up on that. I mean, is there sufficient reason to be confident that we will get the order up-tick or can the customer base generally keep ordering four, five tools here and there, and adequately serve the additional demand that’s coming their way if its stays at these kind of levels? I mean is that a theoretical possibility that we could go on for more than a year or two years just with modest additions?

I mean, if you look at lighting cycle, which we have quite a good view on this and the demand coming from this at a certain point, but we don’t know the timing and the extent. You should see some pick-up, that’s what we expect. Janardan N. Menon – Liberum Capital Ltd.: Okay. Thank you very much.

The next question comes from Jürgen Wagner MainFirst. Please, it’s your turn now. Jürgen Wagner – MainFirst: Yes. Good afternoon. Actually a follow-up question on the ASP question before, in your current orders what trends do you see? And also in the past you provided the split of the order backlog, and the order intake regarding LEDs you mentioned that for sale, could you give us that also for the intake and order backlog? And you mentioned the OpEx being down in Q1, you saw that. How should we model that going forward? And actually I would have a follow-up on the R&D split. And then, I have three questions, sorry.

Starting with your last question, and I’m not sure on the first question that Guido has to support me with what we showed in the past. But regarding your last question, I think we communicated that €100 million is a target number which we have in mind and this is primarily reflected in the €60 million R&D which we communicated I think regularly. And if you consider that I think you will end up close to €100 million. Currently, we are running a little bit lower, but I also mentioned that R&D can always go back and forth a little bit because we also buy some of the R&D work. And then there can be some volatility in this cost position. So overall, we said, based on our business model, €250 million sales, 40% gross margin will allow us for €100 million OpEx in order to break-even. That was the logic we used and we did not change that. Jürgen Wagner – MainFirst: And out of €60 million R&D what is the split between OLED, LED and other silicon at the moment?

This is something we right now don’t publish. And I would appreciate if you have an understanding that we don’t share this information right now. Jürgen Wagner – MainFirst: Okay.

Regarding the – maybe, Guido you mentioned that on backlog on OLED, because that was...

Sure. Hello, Jordon. Backlog, we have more than 50% share of LED related equipment, orders in there, and the orders that we have received were also majority of LED related equipments. So more than 50% for both inline with our sales where we had this time – where we did have this time a stronger LED-related parts and they’ll be more than 70%. But this is as you know fluctuating from quarter-to-quarter depending on the order pattern, and this is again showing – represented part of our product mix related comments that we had on margin. Jürgen Wagner – MainFirst: Okay. And then can you say anything on ASP?

No, we haven’t published anything on that. Jürgen Wagner – MainFirst: Okay, all right. Thank you.

Thank you. Operator: The next question comes from Edwin Mok from Needham. Please, it’s your turn now. Edwin Mok – Needham & Co. LLC: Hi. Thanks for taking my questions. My first question is regarding gross margin. What happened last quarter? Why did it dropped down to 25%? And because I think you mentioned mix, but was there any color or incremental information around what mix share has impacted that? And as we look forward, how do you kind of think about gross margin? Do you think gross margin going to stay with this range until your revenue pick-up, or is that other things you can guys do to improve gross margin? And I have a follow-up. Thank you.

Hi, Edwin, Wolfgang here. If we take a look at our gross margins, of course, I mean it’s driven by the product mix not only this, but also a mix of shipment revenues and final acceptance revenues, which usually final acceptance revenues usually have a much higher gross margin and we have seen a change in mix, this is what we mean. In the previous quarters we had higher final acceptance revenues than in the first quarter. Coming back to the forward-looking gross margin, of course, as Martin mentioned before. We are targeting gross margins with our new product line, which are within our historical range. So the target would be there that we come back to gross margins of around 40%, which is part of our break even modeling going forward. Edwin Mok – Needham & Co. LLC: Okay. Great. Actually, that was very helpful. And then a full question on demand. So, I guess, a two-part question, right? We’ve heard pick-up in LED demand and high utilization rate, but we haven’t seen order improve much at this point. Is it possible that you’re – I mean, and we’ve heard, both you as well as your prime competitor talk about potential launching new product sometime this year, right? Is it possible that your customer just want to wait for the new product given that they know that’s going to be the new product come out that has probably better cost structure, better performance and therefore they don’t want to place the order for the tools right now, until that comes out? And assuming you launched your officially announced new product like you suggest on the second half of this year, right, what kind of cycle time do you think customer will need to qualify that tool, and then actually place high volume production to order, any kind of color on that?

So, considering your first question, the new tool clearly will deliver lower total cost of ownership. And therefore, it’s clear that we cannot say that it’s – it does not have an impact on their decision. So we have to consider that as part of our decision making but it’s clear that our customers also look into this tool and with every generation you get an additional productivity and also as I mentioned reduction in total cost of ownership and that’s clearly has an impact on the investment plan. But how much and to what extent is difficult for me to answer. How long is the qualification? I think three months average this is maybe a good number, could be a little bit more but about three months average is maybe the right number. Okay? Edwin Mok – Needham & Co. LLC: Great, thank you.

Thank you.

The next question comes from Youssef Essaegh from Barclays. May we have your question, please? Please, your line is open now. Youssef Essaegh – Barclays Capital Securities Ltd.: Hello, can you hear me? Hello.

We can hear you. Yes, we can hear you.

Yes, we can hear you, Youssef Youssef Essaegh – Barclays Capital Securities Ltd.: Hey, sorry about that. Youssef from Barclays here. Few years ago you started working with some of your customers in order to implement the manufacturing process or improve it. And can you tell us if you’re still doing that work now and if you feel that the experience something successful? And if overall, your customers especially will win in consumer leisure have – or are still improving their capital efficiency? Thank you.

I assume you’re referring the first question to our supply chain program, and it’s true that we continuously work on this. Actually, we finalized all our conceptual work in the first quarter and we are now in the process of implementing it and peculiar goal here is and the primary goal for us is two things; one, is to reduce the cycle time of our shipments; and secondly, it’s clear that also the importance of our purchasing organization we will significantly increase and therefore also have some changes in that organization. So these are the two major topics we’re addressing here which will at the end also lead us into a number of benefits not just on the cost side. The second question was related to – yeah, that’s whenever we have a view and forecast on the market. We clearly consider that there is a continuous improvement on the yield side of existing tools. There is no question that this is an ongoing activity, but it’s clear that, the older the tools are, the slower the productivity pace will be. But nevertheless, we see that even on older tools with upgrades and new ideas some customers also try to extend the life of this equipment. But that’s at a certain point limited. So, I would say if you are two generations behind, then customers normally start to think also about the next generation. Youssef Essaegh – Barclays Capital Securities Ltd.: Thank you very much.

The next question comes from Christian Rath, HSBC. May we have your question, please? Christian Rath – HSBC Trinkaus & Burkhardt AG: Hey, yes, good afternoon. Just one question probably on what you just said. Given the €12 million revenues you had from the service business and these upgrade packages, I mean, what happens to this if you implement the new tool generation? I mean, can you continue with this run rate, will it drop sharply, will it go up? Thank you.

Actually the service and spares business for me is part of 5-Point-Program and as you see some increase in the last year, but it is clear that this will be also going forward, a major focus of our activities, particularly, if you think about times even longer out when we are behind the lighting cycle. So, we have to establish a really strong service and spares business and that’s what we are working on. I cannot say that it will grow every quarter. But on the other side there is a high focus now in organization in order to work with the customers to improve the situation and create win-win situation. Christian Rath – HSBC Trinkaus & Burkhardt AG: Okay. Thanks.

The next question comes from Thomas Becker from Commerzbank. Please, it’s your turn now. Thomas M. Becker – Commerzbank AG: Yes. Thank you for squeezing me in. just two quick questions. First of all, about China, and your footprint in China, could you please tell a little bit about your, let’s say, structure and how much forces do you have on the ground? Let’s assume, that we will see some order momentum from China, so how are you ready to catch that business? And follow-up from one of my colleagues, this question was asked earlier, with respect to let’s call it the inventory overhang or the tools you had on stock, will that be gone when we enter the second half? And when the new tool is introduced, should we still expect that there are some tools sitting, let’s say, on the balance sheet and the inventory that has to be sold, I mean, all the generations?

Okay. Thank you for your questions. The first question I will answer, second question Wolfgang will touch. Overall, I think if you look also at China and I think the general market, but also particularly in China as mentioned, we see the market sentiment improving. And in terms of new orders, our timing will be important. So the question is how urgently will customers need additional capacity? What is their installed base? Our customers focusing on next-gen tools are on short-term expansions. All these expansions will impact the order intake. And we are in close discussions with the customers. And this is important for China. As I mentioned in previous calls, we are now much closer to the customers, particularly in China, the technical key account managers have brought up the tool performance and increased the onsite support. We have delivered also our tools to several customers who have not bought from us before for testing and qualification. And I can say it was a good result. In addition, we will launch now the next generation tool which is also a competitive technology. So therefore I am convinced that we are in a much better – much better prepared now than a year ago.

Hello, Becker. A short comment from my side; on the inventory, of course we have worked hard over the last one-and-a-half, two years to reduce our inventory which resulted from, let’s say a late reaction to the market downturn some time ago. And we have made significant progress in that respect. And if you look in our balance sheet at the moment, we have a working capital which is now more inline with the actual business and we are of course targeting to keep those ratios. And as Mr. Goetzeler said before, we have worked hard also on reducing our cycle times. And we are clearly targeting here a higher inventory turns going forward in order to lower the risks which go along with the forecast production. Thomas M. Becker – Commerzbank AG: All right. Probably a follow-up to China, could you share a number, how much feet you have on the ground in China with respect onsite services?

No, I think that’s a competitive-information. I would appreciate if you understand that we don’t share it. Thomas M. Becker – Commerzbank AG: Okay. Fair enough. Thank you so much. Thanks you guys.

The next question comes from the Malte Schaumann, Warburg Research. Please, your line is open now. Malte Schaumann – Warburg Research: Yes, good afternoon. The first question is regarding the non-LED business. Given that you had a lot of weaker start in terms of revenues and share of order entries, how do you see that business especially ALD and power semiconductors developing this year? Is there a risk that in the end maybe 2014 revenues will remain below the 2013 figures? And secondly, how do you see your U.S. competitor becoming more competitive potentially in the power semiconductor area with this new tool due for the second half of this year?

On ALD, I think, I made a couple of comments before. I think the – as we mentioned already, we have here – we are qualified in production at one major memory play and then qualification of two others. And I also mentioned that based on this qualification time and also on the investment cycles of these customers, there can be ups and downs and therefore it’s for us clearly something which we are looking into and which we are monitoring. But it’s really something where we also have to meet certain milestones before we can give you a clear indication. In the area of power, I would say the new tools will be an optional or can be an option. On the other side the qualification cycles will be even longer for these processes and many of these customers are now in qualification. So, we are not – I’m not really sure how many was – which immediately to the new technology. Nevertheless, we have to monitor this and to work with our customers. And the point is, maybe being more precise, the reason why it takes, is not to qualify a process, it’s because these power customers, they have to qualify a device, so they are developing basically process and device at the same time and that makes it more complicated Malte Schaumann – Warburg Research: Okay. And we regards to the competition, what – because new tool in that area?

I think, as you know both companies have new tools and we will compete and continue to compete in those areas. Malte Schaumann – Warburg Research: But do you see them or do you expect them to become stronger because I mean you had much greater market share here in the past?

As I mentioned in several calls before I think we always take every competitor very serious and also our non-competitor in this area. So we are monitoring this very tightly. Malte Schaumann – Warburg Research: Okay. Thank you.

The next question comes from Patrick Ho from Stifel, Nicolaus. Please, your line is open now. Patrick J. Ho – Stifel, Nicolaus & Co.: Thank you very much. I just wanted a clarification on your inventory comment. The excess inventory that you’ve been working on, is that completely done? And if not, I guess, how much more time or what kind of duration do you see in terms of finishing off that part of the excess inventory that you’ve been working on for some time?

Hi, Patrick. I am afraid to say, we’re not of course commenting on all details on our inventory. But as I said before we have reached a level of inventory now which we feel it’s appropriate and as you can see now our cash flow of last year we have significantly reduced the inventory over time. So I think we already for whatever future is and most of the inventory issues we had are sorted as I said before. Patrick J. Ho – Stifel, Nicolaus & Co.: Great. Thank you very much.

The next question comes from Andrew Huang from Sterne, Agee. May we have your question, please? Andrew Huang – Sterne, Agee & Leach, Inc.: Thank you. I apologize if this question has been asked already, but I could jump off for a minute. I guess my understanding is that when you look at the tool from Veeco, or the most recent tools in production from Veeco compared to those of AIXTRON. There is this notion that the reactor had to be – AIXTRON reactor had to be cooled down before putting new wafers in there, is this addressed – this kind of downtime issue addressed in the new version of the tool?

The answer is yes. On the other side, I also would like to add that every concept of reactor can be different and you always have certain approaches which gives you other benefits as well as, but to be clear here on your question we can say, yes. Andrew Huang – Sterne, Agee & Leach, Inc.: Great. My second question is with respect to your LED chip customers, when I look at the income statements for a lot of these customers, they’re still not making that much money. And my sense is that, they kind of want to push off equipment purchases for as long as possible before adding new capacity. Do you have any thoughts on their profitability?

I will say the key for us and what we are also following that is that the trend is widened. The trend, I think, is now the majority of our customer base and I also talked to some of my colleagues in Asia over the last couple of days and they actually confirm that as many customers’ trend goes in the right direction. Andrew Huang – Sterne, Agee & Leach, Inc.: Thank you very much.

Thank you.

Thank you. At this time, we’ll have to wrap up the AIXTRON Q1, 2014 earnings call. Thanks for joining us and thanks for your questions. If you have any additional questions, you know where to find us. Please don’t hesitate to contact either IR Manager Andrea Su in California or us here in Germany. Thanks for your interest, and good-bye.