PR Newswire
REHOVOT, Israel, Nov. 12, 2020 /PRNewswire/ — Nova (Nasdaq: NVMI) today announced financial results for the third quarter 2020, the period ended September 30, 2020.
Business Highlights:
- Record quarterly revenue of $69.5 million, up 32% year-over-year
- GAAP net income of $13.9 million, or $0.48 per diluted share, up 60% year-over-year on a per-share basis
- Non-GAAP net income of $16.5 million, or $0.57 per diluted share, up 43% year-over-year on a per-share basis
- Record quarterly optical standalone revenues, driven by growing demand for Nova’s unique dimensional metrology solutions
- In October, completed a private offering of $200 million of 0% convertible senior notes due 2025
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Revenues |
$69,485 |
$62,586 |
$52,507 |
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Net Income |
$13,896 |
$8,672 |
$8,562 |
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Earnings per Diluted Share |
$0.48 |
$0.30 |
$0.30 |
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Net Income |
$16,511 |
$13,774 |
$11,507 |
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Earnings per Diluted Share |
$0.57 |
$0.48 |
$0.40 |
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Management Comments
“Nova’s outstanding financial results for the quarter exceeded our previous expectations and guidance. These results demonstrate the resilience of our operational model and the strategic value we bring to our customers while they continue developing their next generation technology nodes,” commented Eitan Oppenhaim, President and Chief Executive Officer. “Following our strong operational execution in 2020, we remain confident in our strategy and the value we create, which provide us a solid base to deliver our long-term growth objectives.”
2020 Fourth Quarter Financial Outlook
Management provided an outlook for the fourth quarter, the period ending December 31, 2020. Based on current estimates, management expects:
- $66 million to $73 million in revenue
- $0.32 to $0.43 in diluted GAAP EPS
- $0.45 to $0.56 in diluted non-GAAP EPS
2020 Third Quarter Results
Total revenues for the third quarter of 2020 were $69.5 million, an increase of 11.0% compared with the second quarter of 2020 and an increase of 32.3% compared with the third quarter of 2019.
Gross margin for the third quarter of 2020 was 57.1%, compared with a gross margin of 58.5% in the second quarter of 2020, and compared with a gross margin of 52.4% in the third quarter of 2019.
Operating expenses in the third quarter of 2020 were $24.1 million, compared with $26.3 million in the second quarter of 2020 and compared with $21.0 million in the third quarter of 2019.
On a GAAP basis, the Company reported net income of $13.9 million, or $0.48 per diluted share, in the third quarter of 2020. This is compared with net income of $8.7 million, or $0.30 per diluted share, in the second quarter of 2020, and compared with net income of $8.6 million, or $0.30 per diluted share, in the third 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 long-term liabilities and tax effect of non-GAAP adjustments, the Company reported net income of $16.5 million, or $0.57 per diluted share, in the third quarter of 2020. This is compared with net income of $13.8 million, or $0.48 per diluted share, in the second quarter of 2020, and compared with net income of $11.5 million, or $0.40 per diluted share, in the third quarter of 2019.
Conference Call Information
Nova will host a conference call today, November 12, 2020, 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: 1-888-394-8218
ISRAEL TOLL-FREE Dial-in Number: 1-809-212-883
INTERNATIONAL Dial-in Number: 1-323-701-0225
At:
9 a.m. Eastern Time
6 a.m. Pacific Time
4 p.m. Israel Time
Please reference conference ID: 1420148
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 12, 2020 at 12 p.m. Eastern Time to November 19, 2020 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: 1420148
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 long-term liabilities, tax effect of non-GAAP adjustments and amortization of debt discount and issuance costs, 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.
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(U.S. dollars in thousands) – (Unaudited) |
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Current assets |
|||||
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Cash and cash equivalents |
32,713 |
31,748 |
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Short-term interest-bearing bank deposits |
200,676 |
154,533 |
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Trade accounts receivable |
41,097 |
51,603 |
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Inventories |
62,063 |
48,362 |
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Other current assets |
11,899 |
17,122 |
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348,448 |
303,368 |
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Non-current assets |
|||||
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Interest-bearing bank deposits |
2,824 |
2,813 |
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Restricted interest-bearing bank deposits |
2,000 |
2,000 |
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Deferred tax assets |
5,282 |
4,554 |
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Severance pay funds |
1,197 |
1,210 |
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Right of-use assets |
29,508 |
28,256 |
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Property and equipment, net |
32,491 |
30,566 |
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Intangible assets, net |
5,684 |
7,562 |
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Goodwill |
20,114 |
20,114 |
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99,100 |
97,075 |
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447,548 |
400,443 |
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Current liabilities |
|||||
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Trade accounts payable |
22,733 |
20,706 |
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Deferred revenues |
3,791 |
2,256 |
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Operating lease current liabilities |
2,391 |
2,236 |
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Other current liabilities |
26,303 |
21,751 |
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55,218 |
46,949 |
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Non-current liabilities |
|||||
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Accrued severance pay |
2,139 |
2,120 |
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Operating lease long-term liabilities |
31,875 |
31,077 |
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Other long-term liability |
6,616 |
5,758 |
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40,630 |
38,955 |
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351,700 |
314,539 |
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447,548 |
400,443 |
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(U.S. dollars in thousands, except per share data) – (Unaudited) |
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Revenues: |
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Products |
54,757 |
38,723 |
147,579 |
120,185 |
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Services |
14,728 |
13,784 |
45,514 |
40,099 |
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Total revenues |
69,485 |
52,507 |
193,093 |
160,284 |
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Cost of revenues: |
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Products |
20,732 |
16,342 |
55,922 |
48,446 |
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Services |
9,096 |
8,672 |
26,571 |
24,651 |
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Total cost of revenues |
29,828 |
25,014 |
82,493 |
73,097 |
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39,657 |
27,493 |
110,600 |
87,187 |
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Operating expenses: |
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Research and development expenses, net |
12,957 |
10,548 |
37,262 |
34,786 |
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Sales and marketing expenses |
7,406 |
7,156 |
21,232 |
20,943 |
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General and administrative expenses |
3,141 |
2,658 |
11,505 |
7,564 |
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Amortization of acquired intangible assets |
625 |
657 |
1,877 |
1,969 |
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Total operating expenses |
24,129 |
21,019 |
71,876 |
65,262 |
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15,528 |
6,474 |
38,724 |
21,925 |
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Financing income, net |
846 |
887 |
2,261 |
2,252 |
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16,374 |
7,361 |
40,985 |
24,177 |
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Income tax expenses |
2,478 |
(1,201) |
6,735 |
1,391 |
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13,896 |
8,562 |
34,250 |
22,786 |
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Basic |
0.49 |
0.31 |
1.22 |
0.82 |
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Diluted |
0.48 |
0.30 |
1.18 |
0.80 |
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Basic |
28,168 |
27,826 |
28,080 |
27,935 |
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Diluted |
29,020 |
28,474 |
28,933 |
28,599 |
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(U.S. dollars in thousands) – (Unaudited) |
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Cash flows from operating activities: |
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13,896 |
8,562 |
34,250 |
22,786 |
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Adjustments to reconcile net income to net cash |
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Depreciation and amortization |
2,447 |
3,842 |
7,133 |
9,312 |
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Share-based compensation |
1,946 |
1,364 |
4,718 |
3,662 |
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Change in deferred tax assets, net |
(182) |
(410) |
(728) |
(754) |
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Change in accrued severance pay, net |
4 |
25 |
32 |
52 |
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Change in trade accounts receivable |
3,360 |
1,024 |
10,506 |
6,477 |
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Change in inventories |
(6,582) |
(1,332) |
(15,052) |
(9,187) |
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Change in other current and long-term assets |
484 |
(7,180) |
5,223 |
(4,600) |
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Change in trade accounts payable |
1,362 |
1,700 |
2,027 |
(426) |
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Change in other current and long-term liabilities |
2,227 |
3,247 |
4,530 |
(1,332) |
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Change in short term deferred revenues |
2,626 |
(1,599) |
1,535 |
(269) |
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|
21,588 |
9,243 |
54,174 |
25,721 |
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Cash flow from investment activities: |
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Change in short-term and long-term interest-bearing bank |
(13,161) |
(6,040) |
(46,154) |
35 |
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Purchase of property and equipment |
(1,713) |
(7,928) |
(4,873) |
(15,621) |
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(14,874) |
(13,968) |
(51,027) |
(15,586) |
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Cash flows from financing activities: |
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Purchases of treasury shares |
– |
– |
(2,549) |
(7,159) |
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Shares issued upon exercise of options |
114 |
95 |
367 |
367 |
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|
114 |
95 |
(2,182) |
(6,792) |
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|
6,828 |
(4,630) |
965 |
3,343 |
|||
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25,885 |
32,850 |
31,748 |
24,877 |
|||
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32,713 |
28,220 |
32,713 |
28,220 |
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(U.S. dollars in thousands, except percentage and per share data) – (Unaudited) |
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GAAP gross profit |
39,657 |
36,601 |
27,493 |
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Stock-based compensation expenses * |
414 |
279 |
277 |
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Facilities transition costs |
– |
– |
220 |
|||
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Non-GAAP gross profit |
40,071 |
36,880 |
27,990 |
|||
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|
57% |
58% |
52% |
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|
58% |
59% |
53% |
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GAAP operating income |
15,528 |
10,315 |
6,474 |
|||
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Stock-based compensation expenses * |
1,946 |
1,454 |
1,364 |
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Amortization of acquired intangible assets |
625 |
626 |
657 |
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One-time expense related to a transaction made by a |
– |
3,000 |
– |
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Facilities transition costs |
– |
– |
888 |
|||
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Non-GAAP operating income |
18,099 |
15,395 |
9,383 |
|||
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22% |
16% |
12% |
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|
26% |
25% |
18% |
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GAAP net income |
13,896 |
8,672 |
8,562 |
|||
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Stock-based compensation expenses * |
1,946 |
1,454 |
1,364 |
|||
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Amortization of acquired intangible assets |
625 |
626 |
657 |
|||
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One-time expense related to a transaction made by a |
– |
3,000 |
– |
|||
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Facilities transition costs |
– |
– |
888 |
|||
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Revaluation of long-term liabilities |
161 |
594 |
362 |
|||
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Tax effect of non-GAAP adjustments |
(117) |
(572) |
(326) |
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Non-GAAP net income |
16,511 |
13,774 |
11,507 |
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GAAP basic earnings per share |
0.49 |
0.31 |
0.31 |
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Non-GAAP basic earnings per share |
0.59 |
0.49 |
0.41 |
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GAAP diluted earnings per share |
0.48 |
0.30 |
0.30 |
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Non-GAAP diluted earnings per share |
0.57 |
0.48 |
0.40 |
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Shares used for calculation of earnings per share: |
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Basic |
28,168 |
28,039 |
27,826 |
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Diluted |
29,020 |
28,888 |
28,474 |
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* Stock-based compensation expenses for the three months ended September 30, 2020 included in – Cost of revenues products – 259; Cost of revenues services – 155; Research and development expenses, net – 713; Sales and marketing expenses – 409; General and administrative expenses – 410
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(Unaudited) |
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Estimated GAAP net income per diluted share |
0.32 |
0.43 |
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Estimated non-GAAP items: |
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Stock-based compensation expenses |
0.09 |
0.09 |
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Amortization of acquired intangible assets |
0.02 |
0.02 |
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Amortization of debt discount and issuance costs |
0.03 |
0.03 |
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Tax effect of non-GAAP adjustments |
(0.01) |
(0.01) |
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Estimated non-GAAP net income per diluted share |
0.45 |
0.56 |
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Dror David, Chief Financial Officer |
Miri Segal |
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Nova Measuring Instruments Ltd. |
MS-IR LLC |
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Tel: +972-73-229-5760 |
Tel: +917-607-8654 |
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E-mail: [email protected] |
E-mail: [email protected] |
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SOURCE Nova
