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Nova Reports Record Third Quarter 2021 Results
[November 04, 2021]

Nova Reports Record Third Quarter 2021 Results


REHOVOT, Israel, Nov. 4, 2021 /PRNewswire/ -- Nova (Nasdaq: NVMI) today announced record financial results for the third quarter of 2021, the period ended September 30, 2021.

Third Quarter 2021 Highlights:

  • Record quarterly revenue of $112.7 million, up 62% year over year
  • Record GAAP net income of $30.3 million, or $1.02 per diluted share, up 113% year over year on a per-share basis
  • Record non-GAAP net income of $34.5 million, or $1.16 per diluted share, up 104% year over year on a per-share basis
  • Record materials metrology revenue driven by expanded product portfolio and new logic penetration
  • Continuous adoption of the NovaPRISM® standalone platform across segments and customers

GAAP Results ($K)






Q3 2021

Q2 2021

Q3 2020

Revenues

$112,713

$97,746

$69,485

Net Income

$30,335

$22,924

$13,869

Earnings per Diluted Share

$1.02

$0.77

$0.48


NON-GAAP Results ($K)


Q3 2021

Q2 2021

Q3 2020

Net Income

$34,546

$26,886

$16,511

Earnings per Diluted Share

$1.16

$0.90

$0.57

A reconciliation between GAAP operating results and non-GAAP operating results is provided following the financial statements that are part of this release. See also "Use of Non-GAAP Adjusted Financial Measures" section.

Management Comments

"We remain confident in our strategy and the long-term value we create for our customers as they move towards production of next-generation devices across all technologies and segments. With the global surge in demand and the commensurate challenges to production capacity, our technology value continues to resonate strongly with a wide range of customers. This was demonstrated in the third quarter by several  selection wins and by the successful proliferation of our industry-leading technologies," commented Eitan Oppenhaim, President and Chief Executive Officer. "The increasing demand for our innovative portfolio along with the current market demand, paves us the way to another outperformance year in 2021 and builds a solid momentum towards 2022."

2021 Fourth Quarter Financial Outlook

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

  • $113 million to $123 million in revenue
  • $0.78 to $0.96 in diluted GAAP EPS
  • $0.94 to $1.12 in diluted non-GAAP EPS

2021 Third Quarter Results

Total revenues for the third quarter of 2021 were $112.7 million, an increase of 15% compared with the second quarter of 2021 and an increase of 62% compared with the third quarter of 2020.

Gross margin in the third quarter of 2021 was 58%, compared with 57% in the second quarter of 2021 and 57% in the third quarter of 2020.

Operating expenses in the third quarter of 2021 were $29.7 million, compared with $28.7 million in the second quarter of 2021 and $24.1 million in the third quarter of 2020.

On a GAAP basis, the Company reported net income of $30.3 million, or $1.02 per diluted share, in the third quarter of 2021. This is compared with net income of $22.9 million, or $0.77 per diluted share, in the second quarter of 2021, and net income of $13.9 million, or $0.48 per diluted share, in the third quarter of 2020.

On a non-GAAP basis, the Company reported net income of $34.5 million, or $1.16 per diluted share, in the third quarter of 2021. This is compared with net income of $26.9 million, or $0.90 per diluted share, in the second quarter of 2021, and net income of $16.5 million, or $0.57 per diluted share, in the third quarter of 2020.

Conference Call Information

Nova will host a conference call today, November 4, 2021, at 8:30 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: 1-855-327-6837
ISRAEL TOLL-FREE Dial-in Number: 1-809-458-327
INTERNATIONAL Dial-in Number: 1-631-891-4304

At:
8:30 a.m. Eastern Time
5:30 a.m. Pacific Time
2:30 p.m. Israel Time
Please reference conference ID: 10016821

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 November 4, 2021 at 11:30 a.m. Eastern Time to November 11, 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: 10016821

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 Nova website link - https://www.novami.com/.

Nova is traded on the Nasdaq & TASE, Nasdaq ticker symbol NVMI.

Use of Non-GAAP Adjusted Financial Measures

This press release provides financial measures that exclude amortization of acquired intangible assets, stock-based compensation expenses, 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.

Forward-Looking Statements

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 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: catastrophic events such as the outbreak of COVID-19; increased information technology security threats and sophisticated computer crime; foreign political and economic risks; changes in U.S. trade policies; inability to protect intellectual property; open source technology exposure; failure to compete effectively or to respond to the rapid technological changes; consolidation in our industry; difficulty to predict the length and strength of any downturn or expansion period of the market we target; factors that adversely affect the pricing and demand for our product lines; dependency on a small number of large customers; dependency on a single manufacturing facility per product line; dependency on a limited number of suppliers; lengthy sales cycle and customer delays in orders; political, economic, and military instability in Israel; risks related to our convertible notes; currency fluctuations; and quarterly fluctuations in our operating results. 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, 2020 filed with the Securities and Exchange Commission on March 1, 2021. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Nova Ltd. does not assume any obligation to update the forward-looking information contained in this press release.

 

 

NOVA LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

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



As of

ASSETS

September 30,

2021

December 31,

2020

Current assets



Cash and cash equivalents

72,127

232,304

Short-term interest-bearing bank deposits

258,970

191,567

Marketable securities

78,889

-

Trade accounts receivable, net

64,630

63,314

Inventories

73,390

61,734

Other current assets

10,056

9,782

Total current assets

558,062

558,701

Non-current assets



Marketable securities

120,940

-

Interest-bearing bank deposits

3,536

2,547

Restricted interest-bearing bank deposits

1,750

1,476

Deferred tax assets

5,117

2,869

Other long-term assets

571

462

Severance pay funds

1,253

1,281

Operating lease right-of-use assets

28,570

29,109

Property and equipment, net

32,791

34,168

Intangible assets, net

3,336

5,059

Goodwill

20,114

20,114

Total non-current assets

217,978

97,085

Total assets

776,040

655,786

 Liabilities and shareholders' Equity



Current liabilities



Convertible senior notes, net

181,962

-

Trade accounts payable

29,008

24,096

Deferred revenues

31,910

4,717

Operating lease current liabilities

4,153

3,703

Other current liabilities

35,754

28,418

Total current liabilities

282,787

60,934

Non-current liabilities



Convertible senior notes, net

-

178,808

Accrued severance pay

3,745

3,719

Operating lease long-term liabilities

31,039

31,905

Other long-term liability

9,923

8,882

Total non-current liabilities

44,707

223,314

Shareholders' equity

448,546

371,538

Total liabilities and shareholders' equity

776,040

655,786

 

 

NOVA LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

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



Three months ended
September 30,

Nine months ended
September 30,


2021

2020

2021

2020

Revenues:





Products

92,552

54,757

237,128

147,579

Services

20,161

14,728

57,464

45,514

Total revenues

112,713

69,485

294,592

193,093

Cost of revenues

47,475

29,828

125,480

82,493

Gross profit

65,238

39,657

169,112

110,600

Operating expenses:





Research and development, net

15,858

12,957

45,717

37,262

Sales and marketing

9,145

7,406

28,117

21,232

General and administrative

4,135

3,141

11,062

11,505

Amortization of acquired intangible assets

574

625

1,723

1,877

Total operating expenses

29,712

24,129

86,619

71,876

Operating income

35,526

15,528

82,493

38,724

Financing income (expense), net

(889)

846

(1,615)

2,261

Income before tax on income

34,637

16,374

80,878

40,985

Income tax expenses

4,302

2,478

10,003

6,735

Net income for the period

30,335

13,896

70,875

34,250






Earnings per share:





Basic

1.07

0.49

2.50

1.22

Diluted

1.02

0.48

2.39

1.18






Shares used for calculation of earnings per share
 (in thousands):





Basic

28,429

28,168

28,316

28,080

Diluted

29,858

29,020

29,660

28,933


 

 


NOVA LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

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



Three months ended
September 30,

Nine months ended
September 30,


2021

2020

2021

2020

Cash flows from operating activities:





Net income

$ 30,335

$  13,896

$   70,875

$  34,250

Adjustments to reconcile net income to net cash provided by
operating activities:





     Depreciation of property and equipment

1,619

1,474

4,794

4,303

     Amortization of intangible assets

574

625

1,723

1,877

     Amortization of premium and accretion of discount on 
     marketable securities, net

570

-

853

-

     Amortization of debt discount and issuance costs

1,069

-

3,154

-

     Share-based compensation

2,642

1,946

6,992

4,718

     Net effect of exchange rate fluctuation

(63)

(618)

(51)

(397)

Changes in assets and liabilities:





     Trade accounts receivables, net

(6,423)

3,360

(1,316)

10,506

     Inventories

(2,245)

(6,582)

(12,493)

(15,052)

     Other current and long-term assets

(276)

484

(884)

5,223

     Deferred tax assets, net

(534)

(182)

(2,248)

(728)

     Operating lease right-of-use assets

374

352

1,191

956

     Trade accounts payables

2,527

1,362

4,898

2,027

     Deferred revenues

18,319

2,626

27,193

1,535

     Operating lease liabilities

117

(865)

(1,068)

(1,255)

     Other current and long-term liabilities

4,027

3,050

8,332

5,622

     Accrued severance pay, net

(1)

42

54

192

Net cash provided by operating activities

52,631

20,970

111,999

53,777

Cash flows from investment activities:





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

(15,335)

(13,139)

(68,679)

(46,141)

Investment in marketable securities

(107,261)

-

(208,727)

-

Proceed from sales and maturities of marketable securities

6,521

-

7,721

-

Purchase of property and equipment

(760)

(1,713)

(2,566)

(4,873)

Net cash used in investing activities

(116,835)

(14,852)

(272,251)

(51,014)

Cash flows from financing activities:





Purchases of treasury shares

-

-

-

(2,549)

Proceeds from exercise of options

11

114

11

367

Net cash used in financing activities

11

114

11

(2,182)

Effect of exchange rate fluctuations on cash and cash equivalents

30

596

64

384

Decrease in cash and cash equivalents 

(64,163)

6,828

(160,177)

965

Cash and cash equivalents - beginning of period

136,290

25,885

232,304

31,748

Cash and cash equivalents - end of period

$ 72,127

$  32,713

$ 72,127

$  32,713

 

 

NOVA LTD.
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(U.S. dollars in thousands, except percentage and per share data) - (Unaudited)



Three months ended



September 30,
2021

June 30,
2021

September 30,
2020

GAAP gross profit

65,238

55,944

39,657

Stock-based compensation expenses *

557

382

414

Non-GAAP gross profit

65,795

56,326

40,071

GAAP gross margin as a percentage of revenues

58%

57%

57%

Non-GAAP gross margin as a percentage of revenues

58%

58%

58%

GAAP operating income

35,526

27,209

15,528

Stock-based compensation expenses *

2,642

2,128

1,946

Amortization of acquired intangible assets

574

574

625

Non-GAAP operating income

38,742

29,911

18,099

GAAP operating margin as a percentage of revenues

32%

28%

22%

Non-GAAP operating margin as a percentage of revenues

34%

31%

26%

GAAP net income

30,335

22,924

13,896

Stock-based compensation expenses *

2,642

2,128

1,946

Amortization of acquired intangible assets

574

574

625

Amortization of debt discount and issuance costs

1,069

1,051

-

Revaluation of operating lease liabilities

217

554

161

Tax effect of non-GAAP adjustments

(291)

(345)

(117)

Non-GAAP net income

34,546

26,886

16,511





GAAP basic earnings per share

1.07

0.81

0.49

Non-GAAP basic earnings per share

1.22

0.95

0.59





GAAP diluted earnings per share

1.02

0.77

0.48

Non-GAAP diluted earnings per share

1.16

0.90

0.57





Shares used for calculation of earnings per share
(in thousands):




Basic

28,429

28,304

28,168

Diluted

29,858

29,815

29,020






* Stock-based compensation expenses for the three months ended September 30, 2021 included in – Cost of revenues - 557; Research and development expenses, net – 1,025; Sales and marketing expenses – 476; General and administrative expenses – 584


 

 

NOVA LTD.
SUPPLEMENTAL INFORMATION - RECONCILIATION OF FOURTH QUARTER 2021
GAAP TO NON-GAAP GUIDANCE

(Unaudited)





Low

High

Estimated GAAP net income per diluted share

0.78

0.96

Estimated non-GAAP items:



Stock-based compensation expenses

0.11

0.11

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)

(0.01)

Estimated non-GAAP net income per diluted share

0.94

1.12

 

Company Contact:
Dror David, Chief Financial Officer
Tel: +972-73-229-5760
E-mail: [email protected]  
Nova website link - https://www.novami.com/

Investor Relations Contact:
Miri Segal MS-IR LLC
Tel: +917-607-8654
E-mail:  [email protected]

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/nova-reports-record-third-quarter-2021-results-301416368.html

SOURCE Nova


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