Nova Announces 2012 Second Quarter Results
REHOVOT, Israel, July 31, 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 2012 second quarter results.
Highlights for the Second Quarter of 2012
- Quarterly revenues of $27.1 million, up 20% over the first quarter of 2012
- Blended gross margin of 54%
- GAAP Net income of $3.7 million, or $0.14 per diluted share
- Non-GAAP Net income of $5.4 million, or $0.20 per diluted share
- Positive cash flow from operations of $4.5 million
Management Comments
"Our results during the second quarter exceeded the high end of our revenues and earnings per share guidance," said Gabi Seligsohn, President and CEO of Nova. "Our ability to outperform the industry during the quarter is attributed to our strong position in the market segments that are experiencing the highest demand, and which are facing the most challenging process yield requirements.
"The need for additional foundry capacity and yield improvement at 28nm continued to drive strong demand for our solutions. Looking ahead, we expect process control to continue to account for a higher share of overall capital expenditures as foundries are planning a move to 20nm, 14nm and beyond, with associated process complexity and yield requirements. We also believe that these manufacturing and development complexities will continue to drive foundry customers towards buying fully configured tools with significant software content.
"We are able to fully capitalize on current demand because we invested aggressively in 28nm technology three years ago and followed with good execution. We have already announced several wins for the more advanced process nodes and enjoy good traction with our recently announced products as well", Mr. Seligsohn noted. "In addition, during the past several months, we have identified additional areas in which we plan to further invest, in order to remain at the forefront of this dynamic industry. Our strong relationships and track record of execution, combined with a further ramp in research and development expenses during the second half of the year, will position us for future growth, while also remaining solidly profitable."
2012 Third Quarter Guidance
For the third quarter of 2012, management expects revenues of $23.0-$25.5 million, with operating margins of 3%-10%, and with GAAP diluted earnings per share of $0.02-$0.10.
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 $0.04-$0.12 for the third quarter of 2012.
2012 Second Quarter Results
Total revenues for the second quarter of 2012 were $27.1 million, a decrease of 9% relative to the second quarter of 2011, and an increase of 20% relative to the first quarter of 2012.
Gross margin for the second quarter of 2012 was 54%, compared with 58% in the second quarter of 2011 and 56% in the first quarter of 2012.
Operating expenses in the second quarter of 2012 were $9.9 million, compared with $8.2 million in the second quarter of 2011 and $9.3 million in the first quarter of 2012.
On a GAAP basis, the company reported net income of $3.7 million, or $0.14 per diluted share, in the second quarter of 2012. This compares to a net income of $9.2 million, or $0.34 per diluted share, in the second quarter of 2011, and a net income of $2.7 million, or $0.10 per diluted share, in the first quarter of 2012.
On a Non-GAAP basis, which excludes deferred income tax expenses and stock based compensation expenses, the company reported net income of $5.4 million, or $0.20 per diluted share, in the second quarter of 2012. This compares to a net income of $9.4 million, or $0.35 per diluted share, in the second quarter of 2011, and a net income of $4.1 million, or $0.15 per diluted share, in the first quarter of 2012.
Total cash reserves at the end of the second quarter of 2012 were $90.5 million.
The Company will host a conference call today, July 31, 2012, at 9:00am ET. To participate, please dial in the US: 1 877 280 2342; or internationally: +972 3 763 0145 or 1 646 254 3367. 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://ir.nova.co.il/webcast.
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 provides financial measures that exclude non-cash charges for stock-based compensation and deferred income taxes expenses 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; 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; cyber security risks; risks related to open source technologies; 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, 2011 filed with the Securities and Exchange Commission on March 28, 2012. 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.
NOVA MEASURING INSTRUMENTS LTD.
CONSOLIDATED BALANCE SHEET
(U.S. dollars in thousands)
As of As of
June 30, December 31,
2012 2011
CURRENT ASSETS
Cash and cash equivalents 20,408 18,716
Short-term interest-bearing bank deposits 68,029 66,247
Held to maturity securities 1,549 1,582
Trade accounts receivable 17,520 13,402
Inventories 16,067 9,608
Deferred income tax assets 349 2,500
Other current assets 1,920 1,173
125,842 113,228
LONG-TERM ASSETS
Long-term interest-bearing bank deposits 545 545
Other long-term assets 314 291
Severance pay funds 3,068 2,885
3,927 3,721
FIXED ASSETS, NET 6,523 5,998
TOTAL ASSETS 136,292 122,947
CURRENT LIABILITIES
Trade accounts payable 13,212 8,305
Deferred income 4,092 2,172
Other current liabilities 7,556 8,082
24,860 18,559
LONG-TERM LIABILITIES
Liability for employee severance pay 3,982 3,851
Deferred income 63 611
Other long-term liability 17 20
4,062 4,482
SHAREHOLDERS' EQUITY 107,370 99,906
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY 136,292 122,947
NOVA MEASURING INSTRUMENTS LTD.
QUARTERLY CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except per share data)
Three months ended
June 30, March 31, June 30,
2012 2012 2011
REVENUES
Products 22,070 18,767 24,989
Services 4,980 3,835 4,658
27,050 22,602 29,647
COST OF REVENUES
Products 9,150 7,195 9,698
Services 3,324 2,829 2,833
12,474 10,024 12,531
GROSS PROFIT 14,576 12,578 17,116
OPERATING EXPENSES
Research and Development expenses,
net 5,893 5,581 4,516
Sales and Marketing expenses 3,048 2,881 2,778
General and Administration
expenses 972 842 945
9,913 9,304 8,239
OPERATING PROFIT 4,663 3,274 8,877
INTEREST INCOME, NET 339 409 286
INCOME BEFORE INCOME TAXES 5,002 3,683 9,163
INCOME TAX EXPENSES 1,278 946 --
NET INCOME FOR THE PERIOD 3,724 2,737 9,163
Earnings per share:
Basic 0.14 0.10 0.35
Diluted 0.14 0.10 0.34
Shares used for calculation of earnings
per share:
Basic 26,610 26,541 26,250
Diluted 27,299 27,234 27,176
NOVA MEASURING INSTRUMENTS LTD.
YEAR TO DATE CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except per share data)
Six months ended
June 30, June 30,
2012 2011
REVENUES
Product sales 40,837 48,907
Services 8,815 8,909
49,652 57,816
COST OF REVENUES
Product sales 16,345 18,896
Services 6,153 5,568
22,498 24,464
GROSS PROFIT 27,154 33,352
OPERATING EXPENSES
Research & Development expenses, net 11,474 9,483
Sales & Marketing expenses 5,929 5,489
General & Administration expenses 1,814 1,674
19,217 16,646
OPERATING PROFIT 7,937 16,706
INTEREST INCOME, NET
748 505
INCOME BEFORE INCOME TAXES
8,685 17,211
INCOME TAX EXPENSES 2,224 --
NET INCOME FOR THE PERIOD 6,461 17,211
Net income per share:
Basic 0.24 0.66
Diluted 0.24 0.64
Shares used for calculation of net income per
share:
Basic 26,575 26,105
Diluted 27,269 27,014
NOVA MEASURING INSTRUMENTS LTD.
QUARTERLY CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Three months ended
June 30, March 31, June 30,
2012 2012 2011
CASH FLOW - OPERATING ACTIVITIES
Net income for the period 3,724 2,737 9,163
Adjustments to reconcile net
income to net cash
provided by operating
activities:
Depreciation and amortization 577 577 377
Amortization of deferred
stock-based compensation 409 420 272
Increase (decrease) in liability
for employee
termination benefits, net (41) (10) 203
Deferred income taxes 1,241 910 --
Decrease (increase) in trade
accounts receivables 971 (5,089) (4,835)
Increase in inventories (3,282) (3,604) (2,240)
Increase in other current and
long term assets (122) (531) (33)
Increase (decrease) in trade
accounts payables
and other long-term liabilities 1,170 3,737 (667)
Decrease in other current
liabilities (375) (241) (502)
Increase in short and long term
deferred income 212 1,160 5,266
Net cash provided by operating
activities 4,484 66 7,004
CASH FLOW - INVESTMENT
ACTIVITIES
Decrease (increase) in
short-term interest-bearing
bank deposits (10,150) 8,368 (9,426)
Proceeds from (investments in)
short-term held to
maturity securities 87 (54) (1,186)
Additions to fixed assets (679) (573) (539)
Net cash provided by (used in)
investment activities (10,742) 7,741 (11,151)
CASH FLOW - FINANCING ACTIVITIES
Shares issued under employee
share-based plans
and exercise of warrants 72 71 225
Net cash provided by financing
activities 72 71 225
Increase (decrease) in cash and
cash equivalents (6,186) 7,878 (3,922)
Cash and cash equivalents -
beginning of period 26,594 18,716 14,986
Cash and cash equivalents - end
of period 20,408 26,594 11,064
NOVA MEASURING INSTRUMENTS LTD.
YEAR TO DATE CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Six months ended
June 30, June 30,
2012 2011
CASH FLOW - OPERATING ACTIVITIES
Net income for the period 6,461 17,211
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,154 739
Amortization of deferred stock-based
compensation 829 538
Increase (decrease) in liability for employee
termination benefits, net (51) 197
Deferred income taxes 2,151 --
Increase in trade accounts receivables (4,118) (6,513)
Increase in inventories (6,886) (3,509)
Increase in other current and long term assets (653) (1,116)
Increase in trade accounts payables and other
long term liabilities 4,907 1,996
Increase (decrease) in other current
liabilities (616) 176
Increase in short and long term deferred
income 1,372 5,639
Net cash provided by operating activities 4,550 15,358
CASH FLOW - INVESTMENT ACTIVITIES
Increase in short-term interest-bearing bank
deposits (1,782) (29,729)
Proceeds from (investments in) short-term held
to maturity securities 33 (1,186)
Additions to fixed assets (1,252) (1,215)
Net cash used in investment activities (3,001) (32,130)
CASH FLOW - FINANCING ACTIVITIES
Shares issued under employee share-based plans 143 2,442
Net cash provided by financing activities 143 2,442
Increase (decrease) in cash and cash
equivalents 1,692 (14,330)
Cash and cash equivalents - beginning of
period 18,716 25,394
Cash and cash equivalents - end of period 20,408 11,064
DISCLOSURE OF NON-GAAP NET INCOME
(U.S. dollars in thousands, except per share data)
Three months ended
June 30, March 31, June 30,
2012 2011 2011
GAAP Net income for the period 3,724 2,737 9,163
Non-GAAP Adjustments:
Stock based compensation expenses 409 420 272
Deferred income taxes expenses 1,241 910 --
Non-GAAP Net income for the period 5,374 4,067 9,435
Non-GAAP Net income per share:
Basic 0.20 0.15 0.36
Diluted 0.20 0.15 0.35
Shares used for calculation of
Non-GAAP net income per share:
Basic 26,610 26,541 26,250
Diluted 27,299 27,234 27,176
Six months ended
June 30, June 30,
2012 2011
GAAP Net income for the period 6,461 17,211
Non-GAAP Adjustments:
Stock based compensation expenses 829 538
Deferred income taxes expenses 2,151 --
Non-GAAP Net income for the period 9,441 17,749
Non-GAAP Net income per share:
Basic 0.36 0.66
Diluted 0.35 0.64
Shares used for calculation of Non-GAAP net
income per share:
Basic 26,575 26,105
Diluted 27,269 27,014
Company Contact:
Dror David, Chief Financial Officer
Nova Measuring Instruments Ltd.
Tel: +972-73-229-5833
E-mail: [email protected]
http://www.nova.co.il
Investor Relations Contacts:
Ehud Helft / Kenny Green
CCG Investor Relations
Tel: +1-646-201-9246
E-mail: [email protected]
SOURCE Nova Measuring Instruments Ltd
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