Nova Announces 2014 Second Quarter Results
REHOVOT, Israel, July 30, 2014 /PRNewswire/ -- Nova Measuring Instruments (Nasdaq: NVMI), a leading innovator and a key provider of optical metrology solutions for advanced process control used in semiconductor manufacturing, today reported 2014 second quarter results.
Business Highlights:
- Continued delivery to the most advanced nodes for 20/16/14nm product lines
- Successful V2600 Through-Silicon-Via evaluation yielded first order from a leading Logic and Memory customer in Asia
- Expanding presence with new integrated metrology wins
- Multiple evaluations and orders for 10nm R&D lines
- Multiple evaluations at memory customers for V-NAND applications
- Software products gaining traction with orders for both Hybrid Metrology and Fleet Management solutions
Financial Highlights:
- Quarterly revenues of $32.8 million, up 17% from $28.1 million a year ago
- Revenue for the six months ended June 30, 2014 of $67.5 million, up 21% from $55.5 million in the same period a year ago
- Quarterly gross margin of 54%, compared with 55% a year ago
- Quarterly net income of $5.7 million, up 103% from $2.8 million a year ago
- Net income for the six months ended June 30, 2014 of $12.1 million, up 133% from $5.2 million in the same period a year ago
- Total cash reserves of $114.1 million as of June 30, 2014, and no debt
- Initiated previously-announced $12 million share repurchase program
| GAAP Results ($K) |
||||||
| Q2 2014 |
Q1 2014 |
Q2 2013 |
||||
| Revenues |
$32,785 |
$34,660 |
$28,124 |
|||
| Net Income |
$5,694 |
$6,398 |
$2,803 |
|||
| Earnings per Diluted Share |
$0.20 |
$0.23 |
$0.10 |
|||
| NON-GAAP Results ($K) |
||||||
| Q2 2014 |
Q1 2014 |
Q2 2013 |
||||
| Net Income |
$6,108 |
$6,929 |
$3,779 |
|||
| Earnings per Diluted Share |
$0.22 |
$0.25 |
$0.14 |
|||
A reconciliation between GAAP operating results and non-GAAP operating results is provided following the financial statements that are part of this release. Non-GAAP results exclude adjustments of deferred tax assets, stock based compensation expenses, income from insurance claim and loss related to equipment and inventory damage.
Management Comments
"We posted solid results for the quarter with strong net income at the high end of our guidance, delivering on an efficient operating model that maximizes our ongoing investments and guarantees our future growth. In fact, our net income for the first six months of 2014 exceeded our net income for the entire year of 2013", commented Eitan Oppenhaim, President and CEO of Nova. "During the quarter, we continued to strengthen our position in the market segments we are serving, despite the challenging conditions that our customers are facing. We are well positioned to capitalize on their expansions as they move to the next technology nodes."
"The use of Optical Metrology is expanding rapidly as the semiconductor industry continues its technology transition to advanced 3D structures such as V-NAND and FinFET, further broadening the opportunity available to us. We are currently being evaluated in multiple projects with our broad portfolio of products, including our next generation Optical CD tools. We expect these initiatives, along with new technology directions that we are pursuing, to have a substantial impact on our future performance."
Second Quarter 2014 Results
Total revenues for the second quarter of 2014 were $32.8 million, an increase of 17% relative to the second quarter of 2013, and a decrease of 5% relative to the first quarter of 2014.
Gross margin for the second quarter of 2014 was 54%, compared with 55% in the second quarter of 2013 and 51% in the first quarter of 2014.
Operating expenses in the second quarter of 2014 were $12.0 million, same as in the second quarter of 2013 and compared with $11.4 million in the first quarter of 2014.
On a GAAP basis, the company reported net income of $5.7 million, or $0.20 per diluted share, in the second quarter of 2014. This compares to a net income of $2.8 million, or $0.10 per diluted share, in the second quarter of 2013, and a net income of $6.4 million, or $0.23 per diluted share, in the first quarter of 2014.
On a Non-GAAP basis, which excludes deferred income tax expenses, stock based compensation expenses, income from insurance claim and loss related to equipment and inventory damage, the company reported net income of $6.1 million, or $0.22 per diluted share, in the second quarter of 2014. This compares to a net income of $3.8 million, or $0.14 per diluted share, in the second quarter of 2013, and a net income of $6.9 million, or $0.25 per diluted share, in the first quarter of 2014.
Conference Call Information
Nova will host a conference call on Wednesday, July 30, 2014 at 8:30 a.m. Eastern Time, to discuss the second quarter results and future outlook, along with its guidance for the third quarter of 2014.
To attend the conference call, please dial one of the following teleconferencing numbers. Please begin by placing your calls 5 minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.
U.S. Dial-in Number: 1-866-290-0920
ISRAEL Dial-in Number: 1809-24-6064
INTERNATIONAL Dial-in Number: 1-913-312-0422
At:
8:30 a.m. Eastern Time
5:30 a.m. Pacific Time
3:30 p.m. Israeli Time
The conference call will also be webcast live from a link on Nova's website at http://ir.novameasuring.com. For those unable to participate in the conference call, there will be a replay available from a link on Nova's website at http://ir.novameasuring.com.
About Nova: Nova Measuring Instrument Ltd. delivers continuous innovation by providing advanced optical metrology solutions for the semiconductor manufacturing industry. Deployed with the world's largest integrated-circuit manufacturers, Nova's products deliver state-of-the-art, high-performance metrology solutions for effective process control throughout the semiconductor fabrication lifecycle. Nova's product portfolio, which combines high-precision hardware and cutting-edge software, supports the development and production of the most advanced devices in today's high-end semiconductor market. Nova's technical innovation and market leadership enable customers to improve process performance, enhance products' yields and accelerate time to market. Nova acts as a partner to semiconductor manufacturers from its offices around the world. Additional information may be found at www.novameasuring.com.
Nova is traded on the NASDAQ & TASE under the symbol NVMI.
This press release provides financial measures that exclude non-cash charges for stock-based compensation expenses, deferred income taxes expenses, income from insurance claim and loss related to equipment and inventory damage and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Nova's performance because they reflect our operational results and enhances management's and investors' ability to evaluate Nova's performance before charges or benefits considered by management to be outside Nova's ongoing operating results.
The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management believes that it is in the best interest of its investors to provide financial information that will facilitate comparison of both historical and future results and allows greater transparency to supplemental information used by management in its financial and operational decision making. A reconciliation of each GAAP to non-GAAP financial measure discussed in this press release is contained in the accompanying financial tables.
| This press release contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995 relating to future events or our future performance, such as statements regarding trends, demand for our products, expected deliveries, transaction, expected revenues, operating results, earnings and profitability. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied in those forward looking statements. These risks and other factors include but are not limited to: our dependency on two product lines; our dependency on a small number of large customers and small number of suppliers; the highly cyclical nature of the markets we target; our inability to reduce spending during a slowdown in the semiconductor industry; our ability to respond effectively on a timely basis to rapid technological changes; our dependency on PEM; risks related to exclusivity obligations and non-limited liability that may be included in our commercial agreements and arrangements; our ability to retain our competitive position despite the ongoing consolidation in our industry; risks related to our dependence on a single manufacturing facility; risks related to the extremely competitive market we are operation in; risks related to changes in our order backlog; risks related to the financial, political and environmental instabilities in Asia; risks related to our intellectual property; new product offerings from our competitors; unanticipated manufacturing or supply problems; changes in tax requirements; changes in customer demand for our products; risks related to currency fluctuations and risks related to our operations in Israel. We cannot guarantee future results, levels of activity, performance or achievements. The matters discussed in this press release also involve risks and uncertainties summarized under the heading "Risk Factors" in Nova's Annual Report on Form 20-F for the year ended December 31, 2013 filed with the Securities and Exchange Commission on February 28, 2014. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Nova Measuring Instruments Ltd. does not assume any obligation to update the forward-looking information contained in this press release. |
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| Company Contact: |
Investor Relations Contacts: |
||||||
| Dror David, Chief Financial Officer |
Hayden/ MS-IR LLC |
||||||
| Nova Measuring Instruments Ltd. |
Miri Segal |
||||||
| Tel: +972-73-229-5833 |
Tel: +917-607-8654 |
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| E-mail: [email protected] |
E-mail: [email protected] |
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| Or |
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| David Fore |
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| Tel: +206-395-2711 |
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| E-mail: [email protected] |
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| (Tables to Follow) |
|||||||
| NOVA MEASURING INSTRUMENTS LTD. |
||||
| As of |
As of |
|||
| 2014 |
2013 |
|||
| CURRENT ASSETS |
||||
| Cash and cash equivalents |
19,899 |
17,542 |
||
| Short-term interest-bearing bank deposits |
91,536 |
79,552 |
||
| Available for sale securities |
1,873 |
1,845 |
||
| Trade accounts receivable |
26,104 |
27,947 |
||
| Inventories |
18,790 |
18,118 |
||
| Deferred income tax assets |
186 |
137 |
||
| Other current assets |
3,996 |
3,922 |
||
| 162,384 |
149,063 |
|||
| LONG-TERM ASSETS |
||||
| Long-term interest-bearing bank deposits |
750 |
750 |
||
| Other long-term assets |
208 |
230 |
||
| Severance pay funds |
1,773 |
1,852 |
||
| 2,731 |
2,832 |
|||
| FIXED ASSETS, NET |
10,261 |
10,382 |
||
| TOTAL ASSETS |
175,376 |
162,277 |
||
| CURRENT LIABILITIES |
||||
| Trade accounts payable |
12,095 |
15,599 |
||
| Deferred income |
5,670 |
3,420 |
||
| Other current liabilities |
11,839 |
11,448 |
||
| 29,604 |
30,467 |
|||
| LONG-TERM LIABILITIES |
||||
| Liability for employee severance pay |
2,776 |
2,798 |
||
| Deferred income |
421 |
341 |
||
| Other long-term liability |
6 |
7 |
||
| 3,203 |
3,146 |
|||
| SHAREHOLDERS' EQUITY |
142,569 |
128,664 |
||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY |
175,376 |
162,277 |
||
| NOVA MEASURING INSTRUMENTS LTD. |
|||||
| Three months ended |
|||||
| June 30, |
March 31, |
June 30, |
|||
| REVENUES |
|||||
| Products |
26,015 |
28,776 |
22,419 |
||
| Services |
6,770 |
5,884 |
5,705 |
||
| 32,785 |
34,660 |
28,124 |
|||
| COST OF REVENUES |
|||||
| Products |
11,050 |
12,797 |
9,342 |
||
| Services |
4,139 |
4,140 |
3,449 |
||
| 15,189 |
16,937 |
12,791 |
|||
| GROSS PROFIT |
17,596 |
17,723 |
15,333 |
||
| OPERATING EXPENSES |
|||||
| Research and Development expenses, net |
7,152 |
6,901 |
7,567 |
||
| Sales and Marketing expenses |
3,505 |
3,406 |
2,968 |
||
| General and Administration expenses |
1,316 |
1,064 |
1,472 |
||
| 11,973 |
11,371 |
12,007 |
|||
| OPERATING PROFIT |
5,623 |
6,352 |
3,326 |
||
| INTEREST INCOME, NET |
202 |
175 |
246 |
||
| INCOME BEFORE INCOME TAXES |
5,825 |
6,527 |
3,572 |
||
| INCOME TAX EXPENSES |
131 |
129 |
769 |
||
| NET INCOME FOR THE PERIOD |
5,694 |
6,398 |
2,803 |
||
| Earnings per share: |
|||||
| Basic |
0.21 |
0.23 |
0.10 |
||
| Diluted |
0.20 |
0.23 |
0.10 |
||
| Shares used for calculation of earnings per share: |
|||||
| Basic |
27,592 |
27,432 |
27,121 |
||
| Diluted |
28,138 |
27,890 |
27,419 |
||
| NOVA MEASURING INSTRUMENTS LTD. |
|||
| Six months ended |
|||
| June 30, 2014 |
June 30, 2013 |
||
| REVENUES |
|||
| Product |
54,791 |
44,760 |
|
| Services |
12,654 |
10,789 |
|
| 67,445 |
55,549 |
||
| COST OF REVENUES |
|||
| Product sales |
23,847 |
18,421 |
|
| Services |
8,279 |
7,029 |
|
| 32,126 |
25,450 |
||
| GROSS PROFIT |
35,319 |
30,099 |
|
| OPERATING EXPENSES |
|||
| Research and Development expenses, net |
14,053 |
15,066 |
|
| Sales and Marketing expenses |
6,911 |
6,192 |
|
| General and Administration expenses |
2,380 |
2,591 |
|
| 23,344 |
23,849 |
||
| OPERATING PROFIT |
11,975 |
6,250 |
|
| INTEREST INCOME, NET |
377 |
376 |
|
| INCOME BEFORE INCOME TAXES |
12,352 |
6,626 |
|
| INCOME TAX EXPENSES |
260 |
1,428 |
|
| NET INCOME FOR THE PERIOD |
12,092 |
5,198 |
|
| Net income per share: |
|||
| Basic |
0.44 |
0.19 |
|
| Diluted |
0.43 |
0.19 |
|
| Shares used for calculation of net income per share: |
|||
| Basic |
27,512 |
26,988 |
|
| Diluted |
27,983 |
27,278 |
|
| NOVA MEASURING INSTRUMENTS LTD. |
|||||
| Three months ended |
|||||
| June 30, |
March 31, |
June 30, |
|||
| CASH FLOW – OPERATING ACTIVITIES |
|||||
| Net income for the period |
5,694 |
6,398 |
2,803 |
||
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||
| Depreciation and amortization |
972 |
902 |
846 |
||
| Loss related to inventory damage |
- |
- |
148 |
||
| Amortization of deferred stock-based compensation |
472 |
522 |
624 |
||
| Increase (decrease) in liability for employee termination benefits, net |
74 |
(26) |
66 |
||
| Deferred income taxes |
(58) |
9 |
713 |
||
| Decrease (increase) in trade accounts receivables |
(3,898) |
5,741 |
(712) |
||
| Decrease(increase) in inventories |
688 |
(1,360) |
583 |
||
| Decrease (increase) in other current and long term assets |
257 |
(717) |
841 |
||
| Decrease in trade accounts payables and other long-term liabilities |
(2,456) |
(1,049) |
(147) |
||
| Increase (decrease) in other current liabilities |
(787) |
1,233 |
(504) |
||
| Increase (decrease) in short and long term deferred income |
1,247 |
1,083 |
(1,793) |
||
| Net cash provided by operating activities |
2,205 |
12,736 |
3,468 |
||
| CASH FLOW – INVESTMENT ACTIVITIES |
|||||
| Increase in short-term interest-bearing bank deposits |
(1,943) |
(10,041) |
(6,317) |
||
| Investment in short-term available for sale securities |
(19) |
1 |
- |
||
| Proceeds from insurance claim |
- |
- |
219 |
||
| Additions to fixed assets |
(1,228) |
(525) |
(1,042) |
||
| Net cash used in investment activities |
(3,190) |
(10,565) |
(7,140) |
||
| CASH FLOW – FINANCING ACTIVITIES |
|||||
| Purchases of treasury shares |
(1,103) |
- |
- |
||
| Shares issued under employee share-based plans |
961 |
1,313 |
599 |
||
| Net cash provided by (used in) financing activities |
(142) |
1,313 |
599 |
||
| Increase (decrease) in cash and cash equivalents |
(1,127) |
3,484 |
(3,073) |
||
| Cash and cash equivalents – beginning of period |
21,026 |
17,542 |
20,872 |
||
| Cash and cash equivalents – end of period |
19,899 |
21,026 |
17,799 |
||
| NOVA MEASURING INSTRUMENTS LTD. |
|||
| Six months ended |
|||
| June 30, 2014 |
June 30, 2013 |
||
| CASH FLOW – OPERATING ACTIVITIES |
|||
| Net income for the period |
12,092 |
5,198 |
|
| Adjustments to reconcile net income to net cash |
|||
| Depreciation and amortization |
1,874 |
1,670 |
|
| Loss related to equipment and inventory damage |
- |
148 |
|
| Amortization of deferred stock-based compensation |
994 |
1,209 |
|
| Increase in liability for employee termination benefits, net |
48 |
55 |
|
| Deferred income taxes |
(49) |
1,322 |
|
| Decrease (increase) in trade accounts receivables |
1,843 |
(2,355) |
|
| Decrease (increase) in inventories |
(672) |
23 |
|
| Decrease (increase) in other current and long term assets |
(460) |
121 |
|
| Decrease in trade accounts payables and |
(3,505) |
(222) |
|
| Increase in other current liabilities |
446 |
840 |
|
| Increase (decrease) in short and long term deferred income |
2,330 |
(1,732) |
|
| Net cash provided by operating activities |
14,941 |
6,277 |
|
| CASH FLOW – INVESTMENT ACTIVITIES |
|||
| Increase in short-term interest-bearing bank deposits |
(11,984) |
(4,332) |
|
| Investment in short-term available for sale securities |
(18) |
- |
|
| Proceeds from insurance claim |
- |
219 |
|
| Additions to fixed assets |
(1,753) |
(1,384) |
|
| Net cash used in investment activities |
(13,755) |
(5,497) |
|
| CASH FLOW – FINANCING ACTIVITIES |
|||
| Purchases of treasury shares |
(1,103) |
- |
|
| Shares issued under employee share-based plans |
2,274 |
1,056 |
|
| Net cash provided by financing activities |
1,171 |
1,056 |
|
| Increase in cash and cash equivalents |
2,357 |
1,836 |
|
| Cash and cash equivalents – beginning of period |
17,542 |
15,963 |
|
| Cash and cash equivalents – end of period |
19,899 |
17,799 |
|
| DISCLOSURE OF NON-GAAP NET INCOME (U.S. dollars in thousands, except per share data) |
|||||
| Three months ended |
|||||
| June 30, |
March 31, |
June 30, |
|||
| 2014 |
2014 |
2013 |
|||
| GAAP Net income for the period |
5,694 |
6,398 |
2,803 |
||
| Non-GAAP Adjustments: |
|||||
| Stock based compensation expenses |
472 |
522 |
624 |
||
| Deferred Income taxes expenses (income) |
(58) |
9 |
713 |
||
| Income from insurance claim |
- |
- |
(509) |
||
| Loss related to equipment and inventory damage |
- |
- |
148 |
||
| Non-GAAP Net income for the period |
6,108 |
6,929 |
3,779 |
||
| Non-GAAP Net income per share: |
|||||
| Basic |
0.22 |
0.25 |
0.14 |
||
| Diluted |
0.22 |
0.25 |
0.14 |
||
| Shares used for calculation of Non-GAAP net income per share: |
|||||
| Basic |
27,592 |
27,432 |
27,121 |
||
| Diluted |
28,138 |
27,890 |
27,419 |
||
| Six months ended |
|||||
| June 30, |
June 30, |
||||
| 2014 |
2013 |
||||
| GAAP Net income for the period |
12,092 |
5,198 |
|||
| Non-GAAP Adjustments: |
|||||
| Stock based compensation expenses |
994 |
1,209 |
|||
| Deferred income taxes expenses (income) |
(49) |
1,322 |
|||
| Income from insurance claim |
- |
(509) |
|||
| Loss related to equipment and inventory damage |
- |
148 |
|||
| Non-GAAP Net income for the period |
13,037 |
7,368 |
|||
| Non-GAAP Net income per share: |
|||||
| Basic |
0.47 |
0.27 |
|||
| Diluted |
0.47 |
0.27 |
|||
| Shares used for calculation of Non-GAAP net income per share: |
|||||
| Basic |
27,512 |
26,988 |
|||
| Diluted |
27,983 |
27,278 |
|||
SOURCE Nova Measuring Instruments Ltd.
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