Nova Announces 2011 Fourth Quarter and Full Year Results
REHOVOT, Israel, February 15, 2012 /PRNewswire/ --
Nova Measuring Instruments Ltd. (Nasdaq: NVMI), provider of leading edge stand alone metrology and the market leader of integrated metrology solutions to the semiconductor process control market, today reported its 2011 fourth quarter and full year results.
Highlights for the Fourth Quarter of 2011
- Quarterly revenues of $19.2 million
- Gross margin of 55%
- Operating margin of 12%
- GAAP Net income of $5.0 million, or $0.18 per diluted share (including $2.5 million income related to the creation of a deferred income tax asset)
- Non-GAAP Net income of $3.0 million, or $0.11 per diluted share
- Positive cash flow from operating activities of $3.9 million
Highlights for the Full Year of 2011
- Record revenues of $102.8 million, up 19% year over year
- Gross margin of 56%
- Operating margin of 24%
- GAAP Net income of $28.1 million, or $1.04 per diluted share (including $2.5 million income related to the creation of a deferred income tax asset)
- Non-GAAP Net income of $27.1 million, or $1.00 per diluted share
- Positive operating cash flow of $25.1 million
- Total cash reserves at a record level of $87.1 million
Management Comments
"2011 was the best year in our history. It was a third consecutive year of outgrowing the industry, a year in which we crossed the $100 million revenue mark for the first time, generating a net income of more than $27 million and increasing our cash by more than $22 million", said Gabi Seligsohn, President and CEO of Nova. "Fourth quarter revenues were at the high end of our guidance, and profitability exceeded our expectations as a result of a favorable product mix and our success in controlling immediate expenses. In addition, the accounting rules required us to establish a deferred income tax asset as a result of establishing a pattern of profitability, and our fourth quarter net income included a $2.5 million tax benefit."
"We began to see a pickup in bookings early in the fourth quarter, which accelerated as the quarter progressed and we have continued to see a positive trend in the early part of the first quarter. As a result, we ended the year with a very significant improvement in our backlog compared to the end of the third quarter and have entered 2012 with improved visibility. Looking at the opportunities that lie ahead, we are planning to invest the necessary resources to continue and enable our long term growth trajectories. The focus over the last few years on aggressive product development, operational excellence and strong customer presence is what brought us to where we stand today. This focus will continue into the future as we adapt our strategy to the company size we have become, in order to support our long term growth plans."
"After several years of focusing on new customer penetrations, we are benefitting from repeat orders in stand alone solutions and they accounted for a significant proportion of our business in 2011. During the year, we introduced three new products into the field for which we are also receiving repeat orders from multiple customers, a strong indication that we have executed well on our product road map. Our bookings also indicate that we are well-positioned in the high end technology nodes, with most of the orders focused on 28nm and below and with recent wins including 11nm and 14nm process development activities with leading edge customers".
2012 First Quarter Guidance
For the first quarter of 2012, management expects revenues of $20.5-$23.0 million, with operating margins of 6%-13%, and with GAAP diluted earnings per share of $0.04-$0.09.
On a Non-GAAP basis, which excludes adjustments of deferred income tax assets and stock based compensation expenses, management expects diluted earnings per share of $0.07-$0.13 for the first quarter of 2012.
2011 Fourth Quarter Results
Total revenues for the fourth quarter of 2011 were $19.2 million, a decrease of 29% relative to the fourth quarter of 2010, and 26% relative to the third quarter of 2011.
Gross margin for the fourth quarter of 2011 was 55%, compared with 57% in the fourth quarter of 2010 and 55% in the third quarter of 2011.
Operating expenses in the fourth quarter of 2011 were $8.3 million, compared with $8.0 million in the fourth quarter of 2010 and $8.4 million in the third quarter of 2011.
On a GAAP basis, the company reported net income of $5.0 million, or $0.18 per diluted share, in the fourth quarter of 2011, including $2.5 million income related to the creation of a deferred tax asset. This compares to a net income of $7.5 million, or $0.28 per diluted share, in the fourth quarter of 2010, and a net income of $5.9 million, or $0.22 per diluted share, in the third quarter of 2011.
On a Non-GAAP basis, which excludes benefit from income taxes and stock based compensation expenses, the company reported net income of $3.0 million, or $0.11 per diluted share, in the fourth quarter of 2011. This compares to a net income of $7.8 million, or $0.29 per diluted share, in the fourth quarter of 2010, and a net income of $6.4 million, or $0.23 per diluted share, in the third quarter of 2011.
The company generated $3.9 million in cash from operating activities during the fourth quarter of 2011.
2011 Full Year Results
Total revenues for 2011 were $102.8 million, compared to total revenues of $86.6 million for 2010.
Gross margin in 2011 was 56%, compared to 55% in 2010.
Operating expenses in 2011 were $33.3 million, as compared with $25.6 million in 2010.
On a GAAP basis, the company reported net income $28.1 million in 2011, or $1.04 per diluted share, including $2.5 million income related to the creation of a deferred tax asset. This compares to a net income of $22.2 million, or $0.86 per diluted share, in 2010.
On a Non-GAAP basis, which excludes benefit from income taxes and stock based compensation expenses, the company reported net income $27.1 million in 2011, or $1.00 per diluted share. This compares to a net income of $22.9 million, or $0.89 per diluted share, in 2010.
During 2011, the company generated $25.1 million in cash flow from operating activities, as compared to $25.8 million cash flow generated from operating activities in 2010.
Total cash reserves at the end of 2011 were $87.1 million, an increase of $25.5 million compared to the end of 2010.
The Company will host a conference call today, February 15, 2012, at 9:30am ET. To participate, please dial in the US: 1 877 249 9037; or internationally: +972-3-721 9510 / +1 646 254 3364. A recording of the call will be available on Nova's website, within 24 hours following the end of the call. In addition, a presentation to accompany the conference call will be available together with a live webcast of the conference call. This will be accessible from a link on Nova's website at http://www.nova.co.il.
This press release provides financial measures that exclude non-cash charges for stock-based compensation and benefit from income taxes 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.
About Nova
Nova Measuring Instruments Ltd. develops, produces and markets advanced integrated and stand alone metrology solutions for the semiconductor manufacturing industry. Nova is traded on the NASDAQ & TASE under the symbol NVMI. The Company's website is http://www.nova.co.il.
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; 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 OEM suppliers; our ability to retain our competitive position despite the ongoing consolidation in our industry; risks associated with our dependence on a single manufacturing facility; our ability to expand our manufacturing capacity or marketing efforts to support our future growth; our dependency on a small number of large customers and small number of suppliers; our dependency on our key employees; 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; changes in customer demands for our products; new product offerings from our competitors; changes in or an inability to execute our business strategy; 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 31,2010 filed with the Securities and Exchange Commission on March 30, 2011. 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.
(Tables to Follow)
NOVA MEASURING INSTRUMENTS LTD.
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands)
As of As of
December 31, December 31,
2011 2010
CURRENT ASSETS
Cash and cash equivalents 18,716 25,394
Short-term interest-bearing bank deposits 66,247 35,562
Held to maturity securities 1,582 --
Trade accounts receivable 13,402 13,162
Inventories 9,608 10,849
Deferred income tax assets 2,500 --
Other current assets 1,173 1,736
113,228 86,703
LONG-TERM ASSETS
Long-term interest-bearing bank deposits 545 631
Other long-term assets 291 163
Severance pay funds 2,885 2,786
3,721 3,580
FIXED ASSETS, NET 5,998 3,094
Total assets 122,947 93,377
CURRENT LIABILITIES
Trade accounts payable 8,305 9,956
Deferred income 2,172 3,397
Other current liabilities 8,082 7,908
18,559 21,261
LONG-TERM LIABILITIES
Liability for employee severance pay 3,851 3,709
Deferred income 611 --
Other long-term liability 20 23
4,482 3,732
SHAREHOLDERS' EQUITY 99,906 68,384
Total liabilities and shareholders' equity 122,947 93,377
NOVA MEASURING INSTRUMENTS LTD.
QUARTERLY CONSOLIDATED STATEMENTS OF OPERA TIONS
(U.S. dollars in thousands, except per share data)
Three months ended
December 31, September 30, December 31,
2011 2011 2010
REVENUES
Product sales 15,273 21,382 22,650
Services 3,919 4,438 4,339
19,192 25,820 26,989
COST OF REVENUES
Products 5,972 8,921 8,842
Services 2,693 2,782 2,765
8,665 11,703 11,607
GROSS PROFIT 10,527 14,117 15,382
OPERATING EXPENSES
Research & Development
expenses, net 4,567 4,627 4,280
Sales & Marketing expenses 2,951 2,933 2,885
General & Administration
expenses 746 809 843
8,264 8,369 8,008
OPERATING PROFIT 2,263 5,748 7,374
INTEREST INCOME, NET 207 189 119
INCOME BEFORE INCOME TAXES 2,470 5,937 7,493
BENEFIT FROM INCOME TAXES 2,500 -- --
NET INCOME FOR THE PERIOD 4,970 5,937 7,493
Net income per share:
Basic 0.19 0.23 0.30
Diluted 0.18 0.22 0.28
Shares used for calculation
of net income
per share:
Basic 26,425 26,334 25,248
Diluted 27,007 27,079 26,762
NOVA MEASURING INSTRUMENTS LTD.
ANNUAL CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except per share data)
Year ended
December 31, December 31,
2011 2010
REVENUES
Product sales 85,562 71,790
Services 17,266 14,830
102,828 86,620
COST OF REVENUES
Product sales 33,789 29,056
Services 11,043 10,148
44,832 39,204
GROSS PROFIT 57,996 47,416
OPERATING EXPENSES
Research & Development expenses, net 18,677 12,445
Sales & Marketing expenses 11,373 10,133
General & Administration expenses 3,229 2,968
33,279 25,546
OPERATING PROFIT 24,717 21,870
INTEREST INCOME, NET 901 305
INCOME BEFORE INCOME TAXES 25,618 22,175
BENEFIT FROM INCOME TAXES 2,500 --
NET INCOME FOR THE YEAR 28,118 22,175
Net income per share:
Basic 1.07 0.91
Diluted 1.04 0.86
Shares used for calculation of net
income per share:
Basic 26,232 24,448
Diluted 26,931 25,692
NOVA MEASURING INSTRUMENTS LTD.
QUARTERLY CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Three months ended
December September December
31, 30, 31,
2011 2011 2010
CASH FLOW - OPERATING ACTIVITIES
Net income for the period 4,970 5,937 7,493
Adjustments to reconcile net income
to net cash
provided by operating activities:
Depreciation and amortization 541 420 259
Amortization of deferred
stock-based compensation 476 421 257
Deferred income taxes (2,500) -- --
Decrease in liability for employee
termination benefits, net (60) (94) (35)
Decrease (increase) in trade
accounts receivables (1,281) 7,554 (639)
Decrease (increase) in inventories 954 1,499 (1,339)
Decrease in other short and long
term assets 85 726 1,620
Increase (decrease) in trade
accounts payables
and other long term liabilities 332 (3,967) 1,313
Increase (decrease) in other
current liabilities 625 (642) 978
Decrease in short and long term
deferred income (287) (5,966) (3,220)
Net cash provided by operating
activities 3,855 5,888 6,687
CASH FLOW - INVESTMENT ACTIVITIES
Increase (decrease) in short-term
interest-bearing bank deposits 8,044 (9,000) 7,666
Increase (decrease) in long-term
interest-bearing bank deposits 86 -- (61)
Proceeds from (Investments in)
short-term held to maturity
securities (482) 86 --
Additions to fixed assets (632) (460) (400)
Net cash provided by (used in)
investment activities 7,016 (9,374) 7,205
CASH FLOW - FINANCING ACTIVITIES
Shares issued under
employee share-based plans 163 104 525
Net cash provided by
financing activities 163 104 525
Increase (decrease) in cash
and cash equivalents 11,034 (3,382) 14,417
Cash and cash equivalents -
beginning of period 7,682 11,064 10,977
Cash and cash equivalents -
and of period 18,716 7,682 25,394
NOVA MEASURING INSTRUMENTS LTD.
ANNUAL CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Year ended
December 31, December 31,
2011 2010
CASH FLOW - OPERATING ACTIVITIES
Net income for the year 28,118 22,175
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,700 1,260
Amortization of deferred stock-based
compensation 1,435 710
Deferred income taxes (2,500) --
Increase in liability for employee
termination benefits, net 43 108
Increase in trade accounts receivables (240) (1,617)
Increase in inventories (1,056) (7,526)
Increase (decrease) in other short and long
term assets (305) 197
Increase (decrease) in trade accounts
payables and other long term liabilities (1,639) 6,242
Increase in current liabilities 159 2,740
Increase (decrease) in short and long term
deferred income (614) 1,543
Net cash provided by operating activities 25,101 25,832
CASH FLOW - INVESTMENT ACTIVITIES
Increase in short-term interest-bearing bank
deposits (30,685) (26,955)
Investments in short-term held to maturity
securities (1,582) --
Decrease (increase) in long-term
interest-bearing bank deposits 86 (70)
Additions to fixed assets (2,307) (1,565)
Net cash used in investment activities (34,488) (28,590)
CASH FLOW - FINANCING ACTIVITIES
Shares issued under employee share-based
plans and exercise of warrants 2,709 1,323
Shares issued in public offering -- 16,968
Net cash provided by financing activities 2,709 18,291
Increase (decrease) in cash and cash
equivalents (6,678) 15,533
Cash and cash equivalents - beginning of
period 25,394 9,861
Cash and cash equivalents - end of period 18,716 25,394
NOVA MEASURING INSTRUMENTS LTD.
DISCLOSURE OF NON-GAAP NET INCOME
(U.S. dollars in thousands, except per share data)
Three months ended
December 31, September 30, December 31,
2011 2011 2010
GAAP Net income for the period 4,970 5,937 7,493
Non-GAAP Adjustments:
Stock based compensation expenses 476 421 257
Benefit from income taxes (2,500) -- --
Non-GAAP Net income for the period 2,946 6,358 7,750
Non-GAAP Net income per share:
Basic 0.11 0.24 0.31
Diluted 0.11 0.23 0.29
Shares used for calculation of
Non-GAAP net income per share:
Basic 26,425 26,334 25,248
Diluted 27,007 27,079 26,762
Year ended December 31,
2011 2010
GAAP Net income for the year 28,118 22,175
Non-GAAP Adjustments:
Stock based compensation expenses 1,435 710
Benefit from income taxes (2,500) --
Non-GAAP Net income for the year 27,053 22,885
Non-GAAP Net income per share:
Basic 1.03 0.94
Diluted 1.00 0.89
Shares used for calculation of Non-GAAP net
income per share:
Basic 26,232 24,448
Diluted 26,931 25,692
Company Contact:
Dror David, Chief Financial Officer
Nova Measuring Instruments Ltd.
Tel: +972-8-938-7505
http://www.nova.co.il
Investor relations Contacts:
Ehud Helft / Kenny Green
CCG Investor Relations
Tel: +1-646-201-9246
E-mail: [email protected]
E-mail: [email protected]
SOURCE Nova Measuring Instruments Ltd
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