ASML - Summary IFRS Consolidated Statements of Operations¹

	Three months ended,						Twelve months ended,
	Dec 31, 2004			Dec 31, 2005			Dec 31, 2004			Dec 31, 2005
(Amounts in thousands EUR)
Net system sales		709,839			456,016			2,174,908			2,227,678
Net service sales		75,323			91,853			290,469			301,289
Net sales		785,162			547,869			2,465,377			2,528,967
Cost of sales		477,748			358,259			1,563,046			1,583,189
Gross profit on sales		307,414			189,610			902,331			945,778
Research costs		81,589			58,893			355,621			247,217
Research credits		(6,413	)		(3,336	)		(21,961	)		(16,692	)
Selling, general and administrative expenses		52,801			48,182			204,409			205,334
Restructuring expenses		-			-			(5,862	)		-
Total expenses		127,977			103,739			532,207			435,859
Operating income		179,437			85,871			370,124			509,919
Financial income/(expense), net		(4,565	)		(11,671	)		(16,073	)		(49,368	)
Income before income taxes		174,872			74,200			354,051			460,551
Provision for income taxes		(67,192	)		(16,863	)		(127,100	)		(127,725	)
Net income		107,680			57,337			226,951			332,826

ASML - Summary IFRS Consolidated Balance Sheets¹

	Dec 31,		March 27,		June 26,		Sep 25,		Dec 31,
	2004		2005		2005		2005		2005
(Amounts in thousands EUR)
ASSETS
Cash and cash equivalents		1,228,130		1,319,651		1,544,078		1,699,763		1,904,609
Accounts receivable, net		503,153		483,898		485,352		403,489		302,572
Inventories, net		717,688		728,378		695,330		653,098		777,200
Other current assets		230,346		223,768		211,583		210,705		199,651
Total current assets		2,679,317		2,755,695		2,936,343		2,967,055		3,184,032
Deferred tax asset		202,279		212,970		208,965		198,461		208,984
Other assets		27,840		30,266		30,932		36,882		31,873
Intangible assets		31,818		45,882		69,519		85,986		98,545
Property, plant and equipment		303,691		310,316		306,919		292,799		278,581
Total assets		3,244,945		3,355,129		3,552,678		3,581,183		3,802,015
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities		813,141		765,667		776,784		765,463		1,419,982
Convertible subordinated bonds		802,810		708,059		749,169		758,034		293,091
Long term debt and deferred liabilities		236,213		313,805		338,102		316,914		267,971
Shareholders’ equity		1,392,781		1,567,598		1,688,623		1,740,772		1,820,971
Total liabilities and Shareholders’ equity		3,244,945		3,355,129		3,552,678		3,581,183		3,802,015

1.) All figures are unaudited.

ASML - Summary IFRS Consolidated Statements of Cash Flows¹

	Three months ended,						Twelve months ended
	Dec 31, 2004			Dec 31, 2005			Dec 31, 2004			Dec 31, 2005
(Amounts in thousands EUR)	EUR			EUR			EUR			EUR
CASH FLOWS FROM OPERATING ACTIVITIES
Net income		107,680			57,337			226,951			332,826
Depreciation and amortization		20,774			43,685			93,144			122,589
Change in tax assets and liabilities		63,977			(38	)		114,359			142,674
Change in assets and liabilities		(240,442	)		136,125			(183,187	)		211,795
Net cash provided by operating activities		(48,011	)		237,109			251,267			809,884
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures		(28,607	)		(51,604	)		(75,535	)		(172,427	)
Disposals		1,609			8,794			15,136			13,235
Net cash used in investing activities		(26,998	)		(42,810	)		(60,399	)		(159,192	)
Net cash provided by operating and
investing activities		(75,009	)		194,299			190,868			650,692
CASH FLOWS FROM FINANCING ACTIVITIES
Redemption and/or repayment of loans		(331	)		(307	)		(1,159	)		(12,949	)
Proceeds from share issuance		1,077			5,530			20,030			15,828
Net cash provided by financing activities		746			5,223			18,871			2,879
Net cash flow		(74,263	)		199,522			209,739			653,571
Effect of changes in exchange rates on cash		(13,366	)		5,324			(9,418	)		22,908
Net increase in cash and cash equivalents		(87,629	)		204,846			200,321			676,479

ASML - Quarterly Summary IFRS Consolidated Statements of Operations¹

	Three months ended,
	Dec 31,			March 27,			June 26,			Sep 25,			Dec 31,
	2004			2005			2005			2005			2005
(Amounts in millions EUR)
Net system sales		709.8			632.1			680.6			459.0			456.0
Net service sales		75.3			52.6			82.7			74.2			91.9
Net sales		785.1			684.7			763.3			533.2			547.9
Cost of sales		477.7			414.4			467.3			343.3			358.3
Gross profit on sales		307.4			270.3			296.0			189.9			189.6
Research costs, net of credits		75.2			64.9			54.8			55.3			55.6
Selling, general and administrative expenses		52.8			52.2			55.8			49.1			48.1
Total expenses		128.0			117.1			110.6			104.4			103.7
Operating income		179.4			153.2			185.4			85.5			85.9
Financial income/(expense), net		(4.5	)		(12.0	)		(11.5	)		(14.2	)		(11.7	)
Income before Income taxes		174.9			141.2			173.9			71.3			74.2
Provision for income taxes		(67.2	)		(40.3	)		(50.9	)		(19.7	)		(16.9	)
Net income		107.7			100.9			123.0			51.6			57.3

ASML - Notes to the Summary IFRS Consolidated Financial Statements

Basis of Presentation

ASML has prepared the accompanying summary consolidated financial statements in accordance with International Financial Reporting Standards (“IFRS”) in order to satisfy European Union requirements applicable to companies quoted on a European Stock Exchange. Further disclosures, as required under IFRS in annual reports and interim reporting (IAS 34), are not included. The accompanying consolidated financial statements are stated in thousands of euros (“EUR”), except otherwise indicated.

ASML intends to continue publishing U.S. GAAP financial statements, as has been its historical practice.

Principles of consolidation

The accompanying consolidated financial statements include the accounts of ASML Holding N.V. and all of its majority-owned subsidiaries. All inter-company profits, transactions and balances have been eliminated in the consolidation.

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; the 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 and the revenue from the installation of a system 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 premises.

The fair value of installation services provided to the customers is initially deferred and is recognized when the installation is completed. Sales from service contracts are recognized when performed. Revenue from prepaid service contracts is recognized over the life of the contract.

Use of estimates

The preparation of ASML’s consolidated financial statements in conformity with IFRS 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.

Pensions

Under IFRS, ASML applies IAS 19, “Employee benefits”, in accounting for its multi-employer defined benefit plans. In accordance with IAS 19, ASML accounts for its multi-employer defined benefit plan as if it were a defined contribution plan as the pension union managing the plan is not able to provide ASML with sufficient information to enable ASML to account for the plan as a defined benefit plan.

ASML - Reconciliation U.S. GAAP - IFRS¹

Net income	Three months ended,						Twelve months ended,
	Dec 31, 2004			Dec 31, 2005			Dec 31, 2004			Dec 31, 2005
(Amounts in thousands EUR)
Net income under U.S. GAAP		108,637			51,621			235,460			311,464
Share Based Payments (see Note 1)		(957	)		197			(8,509	)		(9,435	)
Capitalization of development costs (see Note 2)		-			10,504			-			51,814
Convertible bonds (see Note 3)		-			(4,985	)		-			(21,017	)
Net income under IFRS		107,680			57,337			226,951			332,826

Shareholders’ Equity

	Dec 31, 2004		Dec 31, 2005		Dec 31, 2004		Dec 31, 2005
(Amounts in thousands EUR)
Shareholders’ equity under U.S. GAAP		1,391,602		1,711,837		1,391,602		1,711,837
Share Based Payments (see Note 1)		1,179		2,100		1,179		2,100
Capitalization of development costs (see Note 2)		-		51,815		-		51,815
Convertible subordinated bonds (see Note 3)		-		55,219		-		55,219
Shareholders’ equity under IFRS		1,392,781		1,820,971		1,392,871		1,820,971

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 accounts for stock option plans using the intrinsic value method in accordance with APB 25 “Accounting for stock issued to employees” and provides pro forma disclosure of the impact of the fair value method on net income and earnings per share in accordance with SFAS 123 “Accounting for stock based compensation”.

Note 2 Capitalization of development costs

Under IFRS, ASML applies IAS 38, “Intangible Assets” beginning from January 1, 2005. During the second half of 2004, ASML made changes to its administrative systems in order to provide sufficient information to comply with IFRS beginning from January 1, 2005. Sufficient reliable information relating to development costs under IFRS before January 1, 2005 is not available. Under IAS 38, capitalized development costs 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 2, “Accounting for Research and Development Costs”. In accordance with SFAS 2, ASML charges costs relating to research and development to operating expense as incurred.

Note 3 Convertible subordinated bonds

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 bonds. The equity component relates to the grant of a conversion option to shares to the holder of the bond.

The liability component creates a financial liability that is measured at amortized cost which results in additional interest charges.

Under U.S. GAAP, ASML accounts for its convertible bonds as a liability at the principal amount outstanding.

"Safe Harbor" Statement under the U.S. Private Securities Litigation Reform Act of 1995: the matters discussed in this document may include forward-looking statements that 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), competitive products and pricing, manufacturing efficiencies, new product development, ability to enforce patents, the outcome of intellectual property litigation, availability of raw materials and critical manufacturing equipment, trade environment, and other risks indicated in the risk factors included in ASML’s Annual Report on Form 20-F and other filings with the U.S. Securities and Exchange Commission.