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Nova Reports Fourth Quarter and Full Year 2020 Results
[February 18, 2021]

Nova Reports Fourth Quarter and Full Year 2020 Results


REHOVOT, Israel, Feb. 18, 2021 /PRNewswire/ -- Nova (Nasdaq: NVMI) today announced financial results for the fourth quarter and full year 2020.

Fourth Quarter 2020 Highlights:

  • Quarterly record revenue of $76.3 million, up 18% year-over-year
  • GAAP net income of $13.7 million, or $0.47 per diluted share, up 9% year-over-year on a per-share basis
  • Non-GAAP net income of $15.9 million, or $0.55 per diluted share, up 8% year-over-year on a per-share basis
  • Initial revenues recognized from multiple customers for Nova ELIPSON™, a newly launched materials metrology solution
  • Record quarterly materials metrology revenue, driven by expansion into leading Logic and Foundry customers

Full Year 2020 Highlights:

  • Record annual revenue of $269.4 million, up 20% year-over-year
  • GAAP net income of $47.9 million, or $1.65 per diluted share, up 35% year-over-year on a per-share basis
  • Non-GAAP net income of $59.6 million, or $2.06 per diluted share, up 30% year-over-year on a per-share basis

 





GAAP Results ($K)


Q4 2020

Q3 2020

Q4 2019

FY 2020

FY 2019

Revenues

$76,303

$69,485

$64,625

$269,396

$224,909

Net Income

$13,657

$13,896

$12,385

$47,907

$35,171

Earnings per Diluted Share

$0.47

$0.48

$0.43

$1.65

$1.23

NON-GAAP Results ($K)


Q4 2020

Q3 2020

Q4 2019

FY 2020

FY 2019

Net Income

$15,872

$16,511

$14,561

$59,638

$45,523

Earnings per Diluted Share

$0.55

$0.57

$0.51

$2.06

$1.59


 

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, stock-based compensation expenses, expense related to a transaction made by a financial institution without Company authorization, facilities transition costs, revaluation of operating lease liabilities, amortization of debt discount and issuance costs and tax effect of non-GAAP adjustment.

Management Comments

"Our robust fourth quarter financial results concluded a record year for Nova, demonstrating the company's growing agility and outstanding execution capabilities," commented Eitan Oppenhaim, President and Chief Executive Officer. "This was a firm conclusion to a well-performed year during which we continued to innovate and expand our differentiated portfolio to support our customers' new generation of devices. Our resilience amid the pandemic, led by our global teams, drove our strong performance throughout the year. With our new enhanced product offering and solid market position, we enter 2021 with substantial momentum to continue our growth across customers and territories."

2021 First Quarter Financial Outlook

Management provided an outlook for the first quarter, the period ending March 31, 2021. Based on current estimates, management expects:

  • $76 million to $83 million in revenue
  • $0.41 to $0.53 in diluted GAAP EPS
  • $0.55 to $0.66 in diluted non-GAAP EPS

2020 Fourth Quarter Results

Total revenues for the fourth quarter of 2020 were $76.3 million, an increase of 9.8% compared with the third quarter of 2020 and an increase of 18.1% compared with the fourth quarter of 2019.

Gross margin for the fourth quarter of 2020 was 55.5%, compared with a gross margin of 57.1% in the third quarter of 2020, and compared with a gross margin of 53.6% in the fourth quarter of 2019.

Operating expenses in the fourth quarter of 2020 were $25.5 million, compared with $24.1 million in the third quarter of 2020 and compared with $20.1 million in the fourth quarter of 2019.

On a GAAP basis, the Company reported net income of $13.7 million, or $0.47 per diluted share, in the fourth quarter of 2020. This is compared with net income of $13.9 million, or $0.48 per diluted share, in the third quarter of 2020, and compared with net income of $12.4 million, or $0.43 per diluted share, in the fourth quarter of 2019.

On a non-GAAP basis, which excludes amortization of acquired intangible assets, stock-based compensation expenses, one-time expense related to a transaction made by a financial institution without Company authorization, facilities transition costs, revaluation of operating lease liabilities, amortization of debt discount and issuance costs and tax effect of non-GAAP adjustment, the Company reported net income of $15.9 million, or $0.55 per diluted share, in the fourth quarter of 2020. This is compared with net income of $16.5 million, or $0.57 per diluted share, in the third quarter of 2020, and compared with net income of $14.6 million, or $0.51 per diluted share, in the fourth quarter of 2019.

2020 Full Year Results

Total revenues for 2020 were $269.4 million, an increase of 19.8% compared to total revenues of $224.9 million for 2019.

Gross margin in 2020 was 56.8%, compared with gross margin of 54.2% in 2019.

Operating expenses in 2020 were $97.4 million, compared with operating expenses of $85.4 in 2019.

On a GAAP basis, the Company reported net income of $47.9 million, or $1.65 per diluted share, in 2020. This is compared with a net income of $35.2 million, or $1.23 per diluted share, in 2019.

On a non-GAAP basis, which excludes amortization of acquired intangible assets, stock-based compensation expenses, one-time expense related to a transaction made by a financial institution without Company authorization, facilities transition costs, revaluation of operating lease liabilities, amortization of debt discount and issuance costs and tax effect of non-GAAP adjustment, the Company reported net income of $59.6 million, or $2.06 per diluted share, in 2020. This is compared with net income of $45.5 million, or $1.59 per diluted share, in 2019.

Conference Call Information

Nova will host a conference call today, February 18, 2021, at 9 a.m. Eastern Time, to discuss the financial results and 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. TOLL-FREE Dial-in Number: 1-866-548-4713
ISRAEL TOLL-FREE Dial-in Number: 1-809-212-883
INTERNATIONAL Dial-in Number: 1-323-794-2093

At:
9 a.m. Eastern Time
6 a.m. Pacific Time
4 p.m. Israel Time
Please reference conference ID: 1340079

The conference call will also be webcast live from a link on Nova's website at https://www.novami.com/investors/events/.

A replay of the conference call will be available from February 18, 2021 at 12 p.m. Eastern Time to February 25, 2021 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: 1340079

A replay will also be available for 90 days on Nova's website at https://www.novami.com/investors/events/.

About Nova: Nova is a leading innovator and key provider of metrology solutions for advanced process control used in semiconductor manufacturing. Nova delivers continuous innovation by providing 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, provides its customers with deep insight into the development and production of the most advanced semiconductor devices. Nova's unique capability to deliver innovative x-ray and optical solutions enables its customers to improve performance, enhance product 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.novami.com.

Nova is traded on the NASDAQ & TASE under the symbol NVMI.

This press release provides financial measures that exclude amortization of acquired intangible assets, stock-based compensation expenses, expense related to a transaction made by a financial institution without Company authorization, facilities transition costs, revaluation of operating lease liabilities, amortization of debt discount and issuance costs and tax effect of non-GAAP adjustment, as applicable, 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 enhance 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 allow 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 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 worldwide financial and economic instabilities, including the implications of the ongoing novel coronavirus (COVID-19) pandemic; 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 technology security threats, including data breaches, cyberattacks and system disruptions, and changes in privacy laws; 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, 2019 filed with the Securities and Exchange Commission on March 12, 2020. 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 December 31,

ASSETS


2020


2019

Current assets





Cash and cash equivalents


232,304


31,748

Short-term interest-bearing bank deposits


191,567


154,533

Trade accounts receivable, net


63,314


51,603

Inventories


61,734


48,362

Other current assets


9,782


16,685






Total current assets


558,701


302,931






Non-current assets





Interest-bearing bank deposits


2,547


2,813

Restricted interest-bearing bank deposits


1,476


2,000

Deferred tax assets


2,869


4,554

Other long-term assets


462


437

Severance pay funds


1,281


1,210

Operating lease right-of-use assets


29,109


28,256

Property and equipment, net


34,168


30,566

Intangible assets, net


5,059


7,562

Goodwill


20,114


20,114






Total non-current assets


97,085


97,512






Total assets


655,786


400,443






 LIABILITIES AND SHAREHOLDERS' EQUITY 





Current liabilities





Trade accounts payable


24,096


20,706

Deferred revenues


4,717


2,256

Operating lease current liabilities


3,703


2,777

Other current liabilities


28,418


20,493






Total current liabilities


60,934


46,232






Non-current liabilities





Convertible senior notes, net


178,808


-

Accrued severance pay


3,719


3,294

Operating lease long-term liabilities


31,905


30,536

Other long-term liability


8,882


5,842






Total non-current liabilities


223,314


39,672






Shareholders' equity


371,538


314,539






Total liabilities and shareholders' equity


655,786


400,443

 

 

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

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



Three months ended

December 31,


Year ended

December 31,


2020


2019


2020


2019









Revenues:








Products

61,741


47,015


209,320


167,200

Services

14,562


17,610


60,076


57,709

Total revenues

76,303


64,625


269,396


224,909









Cost of revenues:








Products

22,633


18,854


78,555


67,300

Services

11,347


11,138


37,918


35,789

Total cost of revenues

33,980


29,992


116,473


103,089









Gross profit

42,323


34,633


152,923


121,820









Operating expenses:








Research and development, net

15,753


9,722


53,015


44,508

Sales and marketing

8,089


7,270


29,321


28,213

General and administrative

1,009


2,502


12,514


10,066

Amortization of acquired intangible assets

626


656


2,503


2,625

Total operating expenses

25,477


20,150


97,353


85,412









Operating income

16,846


14,483


55,570


36,408









Financing income (expense), net

(1,335)


826


926


3,078









Income before tax on income

15,511


15,309


56,496


39,486









Income tax expenses

1,854


2,924


8,589


4,315









Net income for the period

13,657


12,385


47,907


35,171









Earnings per share:








Basic

0.49


0.44


1.71


1.26

Diluted

0.47


0.43


1.65


1.23









Shares used for calculation of earnings per share

 (in thousands):








Basic

28,146


27,965


28,097


27,895

Diluted

28,999


28,689


28,950


28,574

 

 


NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

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



Three months ended

December 31,


Year ended

December 31,


2020


2019


2020


2019

Cash flows from operating activities:








Net income for the period

13,657


12,385


47,907


35,171









Adjustments to reconcile net income to net cash

provided by operating activities:








Depreciation and amortization

2,596


1,086


9,729


10,398

Share-based compensation

2,231


1,430


6,949


5,092

Net effect of exchange rate fluctuation

(1,187)


(106)


(1,584)


(510)

Amortization of debt discount and issuance costs

868


-


868


-

Change in deferred tax assets, net

535


73


(193)


(681)

Change in accrued severance pay, net

162


100


354


470

Change in trade accounts receivable

(22,217)


(4,549)


(11,711)


1,928

Change in inventories

(1,219)


1,669


(16,271)


(7,518)

Change in other current and long-term assets

1,655


(1,561)


6,878


(6,161)

Change in trade accounts payable

1,228


2,117


3,255


1,691

Change in other current and long-term liabilities

7,241


4,190


11,611


2,540

Change in short term deferred revenues

926


(1,459)


2,461


(1,728)









Net cash provided by operating activities

6,476


15,375


60,253


40,692









Cash flow from investment activities:








Change in short-term and long-term interest-bearing bank
deposits

10,125


(4,392)


(36,016)


(4,181)

Purchase of property and equipment

(1,570)


(5,648)


(6,443)


(21,269)









Net cash provided by (used in) investment activities

8,555


(10,040)


(42,459)


(25,450)









Cash flows from financing activities:








Proceeds from the issuance of convertible senior notes,
net of issuance costs

193,588


-


193,588


-

Purchases of treasury shares

(10,000)


-


(12,549)


(7,159)

Shares issued upon exercise of options

-


125


367


492









Net cash provided by (used in) financing activities

183,588


125


181,406


(6,667)









Effect of exchange rate fluctuations on cash and cash
equivalents

972


68


1,356


296









Increase in cash and cash equivalents

199,591


5,528


200,556


8,871

Cash and cash equivalents – beginning of period

32,713


26,220


31,748


22,877

Cash and cash equivalents – end of period

232,304


31,748


232,304


31,748









 

 

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


December 31,

2020


September 30,

2020


December 31,

2019

GAAP gross profit

42,323


39,657


34,633

Stock-based compensation expenses *

415


414


269

Non-GAAP gross profit

42,738


40,071


34,902

GAAP gross margin as a percentage of revenues

55%


57%


54%

Non-GAAP gross margin as a percentage of revenues

56%


58%


54%







GAAP operating income

16,846


15,528


14,483

Stock-based compensation expenses *

2,231


1,946


1,430

Amortization of acquired intangible assets

626


625


656

One-time income related to a transaction made by a
financial institution without Company authorization

(2,850)


-


-

Non-GAAP operating income

16,853


18,099


16,569

GAAP operating margin as a percentage of revenues

22%


22%


22%

Non-GAAP operating margin as a percentage of revenues

22%


26%


26%







GAAP net income

13,657


13,896


12,385

Stock-based compensation expenses *

2,231


1,946


1,430

Amortization of acquired intangible assets

626


625


656

Amortization of debt discount and issuance costs

868


-


-

One-time income related to a transaction made by a
financial institution without Company authorization

(2,850)


-


-

Revaluation of operating lease liabilities

1,364


161


269

Tax effect of non-GAAP adjustments

(24)


(117)


(179)

Non-GAAP net income

15,872


16,511


14,561







GAAP basic earnings per share

0.49


0.49


0.44

Non-GAAP basic earnings per share

0.56


0.59


0.52







GAAP diluted earnings per share

0.47


0.48


0.43

Non-GAAP diluted earnings per share

0.55


0.57


0.51







Shares used for calculation of earnings per share

(in thousands):






Basic

28,146


28,168


27,965

Diluted

28,999


29,020


28,689








* Stock-based compensation expenses for the three months ended December 31, 2020 included in – Cost of revenues
products – 292; Cost of revenues services – 123; Research and development expenses, net – 904; Sales and marketing
expenses – 449; General and administrative expenses – 463

 

 

NOVA MEASURING INSTRUMENTS LTD.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

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



Year ended December 31,


2020


2019

GAAP gross profit

152,923


121,820

Stock-based compensation expenses *

1,364


1,003

Facilities transition costs

-


703

Non-GAAP gross profit

154,287


123,526

GAAP gross margin as a percentage of revenues

57%


54%

Non-GAAP gross margin as a percentage of revenues

57%


55%





GAAP operating income

55,570


36,408

Stock-based compensation expenses *

6,949


5,092

Amortization of acquired intangible assets

2,503


2,625

One-time expense related to a transaction made by a
financial institution without Company authorization,
net

150


-

Facilities transition costs

-


2,329

Non-GAAP operating income

65,172


46,454

GAAP operating margin as a percentage of revenues

21%


16%

Non-GAAP operating margin as a percentage of revenues

24%


21%





GAAP net income

47,907


35,171

Stock-based compensation expenses *

6,949


5,092

Amortization of acquired intangible assets

2,503


2,625

Amortization of debt discount and issuance costs

868


-

One-time expense related to a transaction made by a
financial institution without Company authorization,
net

150


-

Facilities transition costs

-


2,329

Revaluation of operating lease liabilities

2,053


1,410

Tax effect of non-GAAP adjustments

(792)


(1,104)

Non-GAAP net income

59,638


45,523





GAAP basic earnings per share

1.71


1.26

Non-GAAP basic earnings per share

2.12


1.63





GAAP diluted earnings per share

1.65


1.23

Non-GAAP diluted earnings per share

2.06


1.59





Shares used for calculation of earnings per share

(in thousands):




Basic

28,097


27,895

Diluted

28,950


28,574


* Stock-based compensation expenses for the year ended December 31, 2020 included in – Cost of revenues products –
927; Cost of revenues services – 437; Research and development expenses, net – 2,556; Sales and marketing expenses
– 1,531; General and administrative expenses – 1,498


 

 


NOVA MEASURING INSTRUMENTS LTD.

SUPPLEMENTAL INFORMATION - RECONCILIATION OF FISRT QUARTER 2021

GAAP TO NON-GAAP GUIDANCE

(Unaudited)



Low


High

Estimated GAAP net income per diluted share

0.41


0.53

Estimated non-GAAP items:




Stock-based compensation expenses

0.09


0.09

Amortization of acquired intangible assets

0.02


0.02

Amortization of debt discount and issuance costs

0.04


0.04

Tax effect of non-GAAP adjustments

(0.01)


(0.02)

Estimated non-GAAP net income per diluted share

0.55


0.66

 

 

 

Company Contact:
Dror David, Chief Financial Officer
Nova Measuring Instruments Ltd.
Tel: +972-73-229-5760
E-mail: info@novami.com
www.novami.com

Investor Relations Contact:
Miri Segal MS-IR LLC
Tel: +917-607-8654
E-mail: msegal@ms-ir.com

 

 

 

 

 

 

Cision View original content:http://www.prnewswire.com/news-releases/nova-reports-fourth-quarter-and-full-year-2020-results-301230830.html

SOURCE Nova


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