FRANKFURT (Reuters) - Aixtron's new chief executive laid out a strategy focused on returning to profit and wrestling back leadership of the global market for LED chip-making equipment from U.S. rival Veeco Instruments.
The German company swung from a profit in 2011 to a net loss of 103.2 million euros ($132.9 million) last year as orders from customers making light-emitting diode (LED) chips for televisions and lighting equipment dried up.
Though finance chief Wolfgang Breme said at Aixtron's annual shareholder meeting on Thursday that a weak economy had made customers hesitant to invest in production capacity last year, CEO Martin Goetzeler said that not all of the company's problems could be blamed on the market downturn.
Goetzeler, who took the helm in March, said Aixtron rushed to launch a new product in China, the world's biggest market, to take advantage of subsidies and consequently suffered costly and reputation-damaging quality problems.
"We resolved the majority of the problems, and open issues are being systematically addressed," he said.
Aixtron is now taking a number of measures to cut costs and return to profit, including a 20 percent cut to staffing levels in Germany. It will also define clear targets for group sales, operating profit, free cashflow and return on capital employed.
The company plans to rely more on standardized products for modular designs rather than customizing solutions for individual customers and will seek to improve its customer service by appointing technically experienced key account managers.
Shares in Aixtron fell 3.6 percent to 12.40 euros by 1204 GMT, underperforming Germany's TecDAX index, which was down 1.9 percent.
"We welcome the program," Equinet analyst Adrian Pehl said. "But in any case, Aixtron will continue to struggle to preserve cash this year and, longer-term, to win back market share from main rival Veeco."
(Reporting by Victoria Bryan and Maria Sheahan; Editing by David Goodman)
Sen. Baldwin: First Amendment Applies To Institutions of Faith, ‘But I Don’t Think It Extends Far Beyond That’ | Matt Vespa
White House: We Aren't Going to Comment on Murder of Kate Steinle By 7-Time Felon Illegal Alien | Katie Pavlich