Nova Reports First Quarter 2016 Financial Results

REHOVOT, Israel, May 4, 2016 /PRNewswire/ -- Nova Measuring Instruments NVMI, a leading innovator and a key provider of metrology solutions for advanced process control used in semiconductor manufacturing, today reported financial results for the first quarter of 2016, the period ended March 31, 2016.

First Quarter 2016 Highlights:

• Revenues of $34.1 million, within guidance ($33-37 million)
• Non-GAAP net income of $4.5 million, or $0.16 per diluted share, at the high end of the guidance ($0.10-$0.17 per diluted share)
• Diversified customer mix yielded four customers contributing more than 10% each to the quarterly revenues, including one leading memory customer
• Selected by the world's leading foundry to deliver Optical and X-ray metrology solutions for multiple process steps at 10/7/5nm technology nodes
• Growing revenues from multiple competitive wins in China

 

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, deferred tax assets adjustments (net), stock-based compensation expenses and acquisition related expenses.

Management Comments

"The first quarter results were in-line with our expectations, with profitability at the higher end of our guidance, reflecting the market dynamics and our ability to adjust accordingly," commented Eitan Oppenhaim, President and Chief Executive Officer of Nova. "As evident by this quarter results, our focus on customer diversification is becoming critically important, as customers adopt different spending cycles, and is a key to our continuous growth. Our goal to expand our portfolio by converging different metrology techniques (X-ray and Optical) is gathering momentum with several customers as we widen our applications' reach beyond CDs to include Film Thickness and Material composition as well."

"A notable recent uptick in bookings supports our expectations that 2016 will be another well-executed year with a stronger second half that will benefit primarily from investment related to next-generation devices," continued Mr. Oppenhaim. "The increase in bookings is already evident, with the recent announcement of more than $20 million in orders received from several Foundry customers in recent weeks, bolstering our confidence in another solid year for Nova."

2016 Second Quarter Financial Outlook

Management provided an outlook for the second quarter, the period ending June 30, 2016. Based on current estimates, management expects:

• $34 million to $38 million in revenue
• $0.08 to $0.15 in diluted non-GAAP EPS
• $0.04 to $0.10 in diluted GAAP EPS

2016 First Quarter Results

Total revenues for the first quarter of 2016 were $34.1 million, a decrease of 15% compared to the fourth quarter of 2015, and an increase of 24% relative to the first quarter of 2015.

Gross margin for the first quarter of 2016 was 54%. This is compared with 52% in the fourth quarter and first quarter of 2015.

Operating expenses in the first quarter of 2016 were $15.7 million, and included $0.6 million of amortization of acquired intangible assets. This is compared with $17.3 million in the fourth quarter of 2015 and compared with $12.1 million in the first quarter of 2015.

On a GAAP basis, the company reported net income of $2.9 million, or $0.11 per diluted share, in the first quarter of 2016. This is compared with net income of $5.2 million, or $0.19 per diluted share, in the fourth quarter of 2015. The company reported net income of $3.0 million, or $0.11 per diluted share, in the first quarter of 2015.

On a Non-GAAP basis, which excludes amortization of acquired intangible assets, adjustments of deferred tax assets net, stock-based compensation expenses and acquisition related expenses the company reported net income of $4.5 million, or $0.16 per diluted share, in the first quarter of 2016. This is compared with net income of $5.3 million, or $0.19 per diluted share, in the fourth quarter of 2015 and compared with net income of $4.0 million, or $0.15 per diluted share, in the first quarter of 2015.

Conference Call Information

Nova will host a conference call that same day, May 4, 2016, at 9:30 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: 1-888-417-8516
ISRAEL Dial-in Number: 1-80-924-5906
INTERNATIONAL Dial-in Number: 1-719-457-2645
At:
9:30 a.m. Eastern Time
6:30 a.m. Pacific Time
4:30 p.m. Israeli Time

Please reference conference ID 1539748

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

About Nova: Nova Measuring Instruments 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 non-cash charges for amortization of acquired intangible assets, deferred tax assets adjustments (net), stock-based compensation expenses and acquisition related 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 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, 2015 filed with the Securities and Exchange Commission on February 29, 2016. 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.

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SOURCE Nova Measuring Instruments