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Nova Reports Record Results for First Quarter 2017
[May 09, 2017]

Nova Reports Record Results for First Quarter 2017


REHOVOT, Israel, May 9, 2017 /PRNewswire/ -- 

Nova (Nasdaq: NVMI), a leading innovator and a key provider of metrology solutions for advanced process control used in semiconductor manufacturing, today reported record financial results for the first quarter 2017, the period ended March 31, 2017.

First Quarter 2017 Highlights:

  • Record quarterly revenue of $54.4 million, up 8% sequentially and 60% year-over-year, above guidance of $50 to $54 million
  • GAAP net income of $13.4 million, or $0.48 per diluted share, up 60% sequentially and 336% year-over-year on a per-share basis, exceeding guidance of $0.31 to $0.39 per share
  • Non-GAAP net income of $14.1 million, or $0.50 per diluted share, up 19% sequentially and 212% year-over-year on a per-share basis, exceeding guidance of $0.37 to $0.45 per share
  • Record quarterly revenue from Integrated Metrology solutions
  • Record quarterly bookings from 3D-NAND

 



GAAP Results ($K)


Q1 2017

Q4 2016

Q1 2016

Revenues

$54,430

$50,212

$34,056

Net Income

$13,403

$8,364

$2,905

Earnings per Diluted Share

$0.48

$0.30

$0.11

NON-GAAP Results ($K)


Q1 2017

Q4 2016

Q1 2016

Net Income

$14,115

$11,719

$4,450

Earnings per Diluted Share

$0.50

$0.42

$0.16


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 amortization of acquired intangible assets, net adjustments of deferred tax assets and stock-based compensation expenses.

Management Comments

"Nova continued to perform well this quarter, setting new business and financial records that demonstrate our growing competitive strength across the market segments we serve," commented Eitan Oppenhaim, President and Chief Executive Officer of Nova. "Growing demand for our unique value proposition, which is becoming a key enabler for our customers' transition to the most advanced products, enabled us to achieve these outstanding milestones. Nova's solid start for the year, along with the second quarter guidance, supports our outlook for another strong year, in which we continue to effectively execute the Company's growth plans and expand our position within leading edge customers."

2017 Second Quarter Financial Outlook

Management provided an outlook for the second quarter, the period ending June 30, 2017. Based on current estimates, management expects:

  • $52 million to $56 million in revenue
  • $0.32 to $0.39 in diluted GAAP EPS
  • $0.38 to $0.46 in diluted non-GAAP EPS

2017 First Quarter Results

Total revenues for the first quarter of 2017 were $54.4 million, a sequential increase of 8% compared to the fourth quarter of 2016, and a year-over-year increase of 60% relative to the first quarter of 2016.

Gross margin for the first quarter of 2017 was 60%, compared sequentially with gross margin of 56% in the fourth quarter of 2016, and compared with gross margin of 54% in the first quarter of 2016.

Operating expenses in the first quarter of 2017 were $17.7 million. This is compared with $17.4 million in the fourth quarter of 2016 and compared with $15.7 million in the first quarter of 2016.

On a GAAP basis, the company reported net income of $13.4 million, or $0.48 per diluted share, in the first quarter of 2017. This is compared with $8.4 million, or $0.30 per diluted share, in the fourth quarter of 2016, and compared with net income of $2.9 million, or $0.11 per diluted share, in the first quarter of 2016.

On a non-GAAP basis, which excludes amortization of acquired intangible assets, net adjustments of deferred tax assets and stock-based compensation expenses, the company reported net income of $14.1 million, or $0.50 per diluted share, in the first quarter of 2017. This is compared with net income of $11.7 million, or $0.42 per diluted share, in the fourth quarter of 2016, and compared with net income of $4.5 million, or $0.16 per diluted share, in the first quarter of 2016.

Total cash reserves at March 31, 2017 were $115.8 million, compared to $91.7 million at December 31, 2016.

Conference Call Information

Nova will host a conference call today, May 9, 2017, at 9 a.m. Eastern Time, to discuss the financial results and future outlook. To attend the conference call, please dial one of the following teleconferencing numbers. Please begin by placing your calls five 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: 1-888-437-9364
ISRAEL Dial-in Number: 1 80 924 6042
INTERNATIONAL Dial-in Number: 1-719-325-2236
At:
9 a.m. Eastern Time
6 a.m. Pacific Time
4 p.m. Israeli Time

Please reference conference ID 6912093

The conference call will also be webcast live from a link on Nova's website at http://ir.novameasuring.com.

A replay of the conference call will be available from May 9, 2017 at 12 p.m. Eastern Time to May 16, 2017 at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:

Replay Dial-in TOLL-FREE   1-844-512-2921
Replay Dial-in TOLL/INTERNATIONAL   1-412-317-6671

Replay Pin Number:  6912093

A replay will also be available for 90 days on Nova's website at http://ir.novameasuring.com.

About Nova: Nova delivers continuous innovation by providing advanced 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 charges for amortization of acquired intangible assets, net adjustment of deferred tax assets and stock-based compensation 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, but are not limited to, anticipated growth opportunities and projections about our business and its future revenues, expenses 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. Factors that may affect our results, performance, circumstances or achievements include, but are not limited to, the following: our dependency on three product lines; our dependency on a small number of large customers and small number of suppliers; the highly cyclical and competitive nature of the markets we target and we operate in; 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 ability to recognize the benefits of ReVera acquisition and risks that the acquisition may disrupt current plans and operations and impact relationships with customers, distributors and suppliers; our dependency on PEMs; 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 our manufacturing facilities; risks related to changes in our order backlog; risks related to efforts to complete and integrate current and/or future acquisitions; risks related to the worldwide financial instabilities; risks related to our intellectual property; new product offerings from our competitors; unanticipated manufacturing or supply problems; risks related to government programs we participate in; risks related to taxation; changes in customer demand for our products; risks related to currency fluctuations, risks related to acquisitions we may pursue 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, 2016 filed with the Securities and Exchange Commission on March 3, 2017. 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.

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands) - (Unaudited)



As of

ASSETS


March 31,


December 31,


2017

2016

Current assets






   Cash and cash equivalents


24,423


20,406


   Short-term interest-bearing bank deposits


90,624


70,546


   Trade accounts receivable


38,239


42,626


   Inventories


30,812


29,260


   Other current assets


4,647


5,068








Total current assets


188,745


167,906








Long-term assets






   Long-term interest-bearing bank deposits


750


750


   Deferred tax assets


2,769


3,020


   Severance pay funds


1,494


1,425


   Property and equipment, net


9,505


10,017


   Identifiable intangible assets, net


14,721


15,361


   Goodwill


20,114


20,114








Total long-term assets


49,353


50,687








Total assets


238,098


218,593








LIABILITIES AND SHAREHOLDER'S EQUITY

Current liabilities






   Trade accounts payable


16,591


16,501


   Deferred revenues


6,466


4,072


   Other current liabilities


19,747


18,461








Total current liabilities


42,804


39,034








Long-term liabilities






   Deferred tax liabilities


252


1,094


   Liability for employee severance pay


2,519


2,418


   Other long-term liabilities


1,464


1,330








Total long-term liabilities


4,235


4,842








Shareholders' equity 


191,059


174,717








Total liabilities and shareholders' equity 


238,098


218,593


 

 

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except per share data) - (Unaudited)



Three months ended


March 31,


March 31,

2017

2016





Revenues:




Products

43,516


24,262

Services

10,914


9,794

Total revenues

54,430


34,056





Cost of revenues:




Products 

15,120


9,861

Services

6,450


5,665

Total cost of revenues

21,570


15,526





Gross profit 

32,860


18,530





Operating expenses:




Research and development expenses, net 

9,275


7,908

Sales and marketing expenses

6,088


5,367

General and administration expenses

1,657


1,810

Amortization of acquired intangible assets

640


636

Total operating expenses

17,660


15,721





Operating income

15,200


2,809

Financing income, net

415


469





Income before tax on income

15,615


3,278





Income tax expenses 

2,212


373





Net income for the period

13,403


2,905





Earnings per share:




Basic

0.49


0.11

Diluted

0.48


0.11





Shares used for calculation of earnings per share:








Basic

27,467


27,116

Diluted

28,148


27,351





 

 

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands) - (Unaudited)



Three months ended


March 31,


March 31,

2017

2016

Cash flows from operating activities:




Net income for the period

13,403


2,905





Adjustments to reconcile net income to net cash

provided by (used in) operating activities:

Depreciation

955


1,285

Amortization of acquired intangible assets

640


636

Amortization of deferred stock-based compensation

663


756

Increase in liability for employee termination benefits, net

32


66

Deferred tax assets, net

(591)


153

Decrease (increase) in trade accounts receivable

4,387


(3,040)

Increase in inventories

(1,575)


(370)

Decrease (increase) in other current and long term assets

421


(347)

Increase (decrease) in trade accounts payable 

90


(3,190)

Increase (decrease) in other current liabilities and other long-term liabilities

1,879


(117)

Increase (decrease) in short and long term deferred revenues 

2,394


(2,957)





Net cash provided by (used in) operating activities

22,698


(4,220)





Cash flow from investment activities:




Increase in short-term interest-bearing bank deposits

(20,078)


(7,030)

Additions to property and equipment

(420)


(577)





Net cash used in investment activities

(20,498)


(7,607)





Cash flows from financing activities-




Shares issued under employee stock-based plans

1,817


292





Net cash provided by financing activities

1,817


292





Increase (decrease) in cash and cash equivalents

4,017


(11,535)

Cash and cash equivalents – beginning of period

20,406


27,733

Cash and cash equivalents – end of period

24,423


16,198

 

 

NOVA MEASURING INSTRUMENTS LTD.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(U.S. dollars in thousands, except percentage and per share data) - (Unaudited)



Three months ended


March 31,

2017


December 31,

2016


March 31,

2016

GAAP cost of revenues

21,570


22,054


15,526

Stock-based compensation in cost of products

(76)


(88)


(96)

Stock-based compensation in cost of services

(66)


(54)


(64)

Non-GAAP cost of revenues

21,428


21,912


15,366







GAAP gross profit

32,860


28,158


18,530

Gross profit adjustments

142


142


160

Non-GAAP gross profit

33,002


28,300


18,690

GAAP gross margin as a percentage of revenues

60%


56%


54%

Non-GAAP gross margin as a percentage of revenues

61%


56%


55%







GAAP operating expenses

17,660


17,377


15,721

Stock-based compensation in research and development

(262)


(247)


(306)

Stock-based compensation in sales and marketing

(165)


(211)


(210)

Stock-based compensation in general and administrative

(94)


(91)


(80)

Amortization of acquired intangible assets

(640)


(636)


(636)

Non-GAAP operating expenses

16,499


16,192


14,489

Non-GAAP operating income

16,503


12,108


4,201

GAAP operating margin as a percentage of revenues

28%


21%


8%

Non-GAAP operating margin as a percentage of revenues

30%


24%


12%







GAAP tax on income

2,212


2,607


373

Deferred tax assets adjustments, net

591


(2,028)


(153)

Non-GAAP tax on income

2,803


579


220







GAAP net income

13,403


8,364


2,905

Amortization of acquired intangible assets

640


636


636

Stock-based compensation expenses

663


691


756

Deferred tax assets adjustments, net

(591)


2,028


153

Non-GAAP net income

14,115


11,719


4,450







GAAP basic earnings per share

0.49


0.31


0.11

Non-GAAP basic earnings per share

0.51


0.43


0.16







GAAP diluted earnings per share

0.48


0.30


0.11

Non-GAAP diluted earnings per share

0.50


0.42


0.16







Shares used for calculation of earnings per share:






Basic

27,467


27,292


27,116

Diluted

28,148


27,704


27,351








 

 

 

Company Contact:

Investor Relations Contacts:

Dror David, Chief Financial Officer

Hayden/ MS-IR LLC

Nova Measuring Instruments Ltd.

Miri Segal

Tel: +972-73-229-5760

Tel: +917-607-8654

E-mail: info@novameasuring.com  

E-mail: msegal@ms-ir.com

www.novameasuring.com

Or


Brett Maas


Tel: +646-536-7331


E-mail: brett@haydenir.com

 

 

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/nova-reports-record-results-for-first-quarter-2017-300453366.html

SOURCE Nova Measuring Instruments Ltd


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