PLAINVIEW, NY -- (Marketwired) -- 11/02/17 --
Third Quarter 2017 Highlights:
- Revenues of $131.9 million, compared with $85.5 million in the same period last year
- GAAP net loss of $21.9 million, or $0.47 per share
- Non-GAAP net income of $4.3 million, or $0.09 per diluted share
Veeco Instruments Inc. (NASDAQ: VECO) today announced financial results for its third fiscal quarter ended September 30, 2017. Results are reported in accordance with U.S. generally accepted accounting principles ("GAAP") and are also reported adjusting for certain items ("Non-GAAP"). A reconciliation between GAAP and Non-GAAP operating results is provided at the end of this press release.
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U.S. dollars in millions, except per share data
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GAAP Results Q3 '17 Q3 '16
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Revenue $131.9 $85.5
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Net income (loss) ($21.9) ($69.6)
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Diluted earnings (loss) per share ($0.47) ($1.78)
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---------------
Non-GAAP Results Q3 '17 Q3 '16
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Net income (loss) $4.3 ($1.8)
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Operating income (loss) $6.8 ($0.2)
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Diluted earnings (loss) per share $0.09 ($0.05)
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"The third quarter of 2017 marked the first full quarter of Veeco and Ultratech on a combined basis. Sales in the quarter were driven by increased shipments of our MOCVD tools and backlog has continued to build. Also during the quarter, we formally released our new MOCVD system, the EPIK® 868, which provides a lower-cost and higher-productivity solution for our customers," commented John R. Peeler, Chairman and Chief Executive Officer. "The integration of Ultratech into Veeco is proceeding extremely well with many key milestones now behind us, including the complete integration of our sales and support organizations. As a result, we are even stronger than before, with the right staff in each region, focused on driving improved results for our business and customers."
Guidance and Outlook
The following guidance is provided for Veeco's fourth quarter 2017:
- Revenue is expected to be in the range of $135 million to $155 million
- GAAP net loss is expected to be in the range of ($15) million to ($8) million
- Non-GAAP operating income is expected to be in the range of $5 million to $12 million
- GAAP earnings (loss) per share are expected to be in the range of ($0.33) to ($0.17)
- Non-GAAP earnings (loss) per share are expected to be in the range of $0.00 to $0.16
Please refer to the tables at the end of this press release for further details.
Conference Call Information
A conference call reviewing these results has been scheduled for today, November 2, 2017 starting at 5:00pm ET. To join the call, dial 800-263-0877 (toll free) or 323-701-0225 and use passcode 7119567. The call will also be webcast live on the Veeco website at ir.veeco.com. A replay of the webcast will be made available on the Veeco website beginning at 8:00pm ET this evening. We will post an accompanying slide presentation to our website prior to the beginning of the call.
About Veeco
Veeco (NASDAQ: VECO) is a leading manufacturer of innovative semiconductor process equipment. Our proven MOCVD, lithography, laser annealing, ion beam and single wafer etch & clean technologies play an integral role in producing LEDs for solid-state lighting and displays, and in the fabrication of advanced semiconductor devices. With equipment designed to maximize performance, yield and cost of ownership, Veeco holds technology leadership positions in all these served markets. To learn more about Veeco's innovative equipment and services, visit www.veeco.com.
Forward-looking Statements
To the extent that this news release discusses expectations or otherwise makes statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include the risks discussed in the Business Description and Management's Discussion and Analysis sections of Veeco's Annual Report on Form 10-K for the year ended December 31, 2016 and in our subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and press releases. Veeco does not undertake any obligation to update any forward-looking statements to reflect future events or circumstances after the date of such statements.
-financial tables attached-
Veeco Instruments Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
(unaudited)
Three months ended Nine months ended
September 30, September 30,
2017 2016 2017 2016
---------- ---------- --------- ---------
Net sales $ 131,872 $ 85,482 $ 341,324 $ 238,842
Cost of sales 78,811 52,027 215,344 141,991
---------- ---------- --------- ---------
Gross profit 53,061 33,455 125,980 96,851
---------- ---------- --------- ---------
Operating expenses, net: 40.24%
Research and development 24,061 19,892 57,669 63,545
Selling, general, and
administrative 29,771 18,396 71,574 58,230
Amortization of intangible
assets 12,500 5,261 21,722 15,785
Restructuring 5,010 1,798 9,605 3,993
Acquisition costs 783 - 16,277 -
Asset impairment 2 56,035 1,139 69,662
Other, net (140) 795 (228) 884
---------- ---------- --------- ---------
Total operating expenses, net 71,987 102,177 177,758 212,099
---------- ---------- --------- ---------
Operating income (loss) (18,926) (68,722) (51,778) (115,248)
Interest income (expense),
net (4,748) 260 (12,368) 713
---------- ---------- --------- ---------
Income (loss) before income
taxes (23,674) (68,462) (64,146) (114,535)
Income tax expense (benefit) (1,790) 1,136 (24,969) 2,677
---------- ---------- --------- ---------
Net income (loss) $ (21,884) $ (69,598) $ (39,177) $(117,212)
========== ========== ========= =========
Income (loss) per common
share:
Basic $ (0.47) $ (1.78) $ (0.91) $ (2.99)
Diluted $ (0.47) $ (1.78) $ (0.91) $ (2.99)
Weighted average number of
shares:
Basic 46,941 39,131 43,100 39,193
Diluted 46,941 39,131 43,100 39,193
Veeco Instruments Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
September 30, December 31,
2017 2016
------------- --------------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 235,268 $ 277,444
Short-term investments 85,853 66,787
Accounts receivable, net 113,795 58,020
Inventories 113,681 77,063
Deferred cost of sales 17,594 6,160
Prepaid expenses and other current assets 36,396 16,034
------------- --------------
Total current assets 602,587 501,508
Property, plant and equipment, net 84,403 60,646
Intangible assets, net 383,596 58,378
Goodwill 308,529 114,908
Deferred income taxes 2,528 2,045
Other assets 25,263 21,047
------------- --------------
Total assets $ 1,406,906 $ 758,532
============= ==============
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 53,716 $ 22,607
Accrued expenses and other current
liabilities 65,728 33,201
Customer deposits and deferred revenue 107,636 85,022
Income taxes payable 4,171 2,311
Current portion of long-term debt - 368
------------- --------------
Total current liabilities 231,251 143,509
Deferred income taxes 46,268 13,199
Long-term debt 272,825 826
Other liabilities 11,033 6,403
------------- --------------
Total liabilities 561,377 163,937
Total stockholders' equity 845,529 594,595
------------- --------------
Total liabilities and stockholders'
equity $ 1,406,906 $ 758,532
============= ==============
Veeco Instruments Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Data
(in thousands, except per share amounts)
(unaudited)
Non-GAAP Adjustments
------------------------------------
Share-Based
Three months ended September 30, 2017 GAAP Compensation Amortization Other Non-GAAP
---------------------------------------------- ---------- ------------ ------------ ---------- ----------
Net sales $ 131,872 $ 131,872
Gross profit 53,061 740 1,954 55,755
Gross margin 40.2% 42.3%
Research and development 24,061 (849) 23,212
Selling, general, and administrative and Other 29,631 (3,714) (195) 25,722
Net income (loss) (21,884) 6,170 12,500 7,504 4,290
Income (loss) per common share:
Basic $ (0.47) $ 0.09
Diluted (0.47) 0.09
Weighted average number of shares:
Basic 46,941 47,107
Diluted 46,941 47,327
Veeco Instruments Inc. and Subsidiaries
Other Non-GAAP Adjustments
(in thousands)
(unaudited)
Three months ended September 30, 2017
-----------------------------------------------------------------
Restructuring 4,143
Acquisition related 783
Release of inventory fair value step-up associated with the
Ultratech purchase accounting 1,856
Depreciation of PP&E fair value step-up associated with the
Ultratech purchase accounting 293
Asset impairment 2
Non-cash interest expense 2,754
Non-GAAP tax adjustment * (2,327)
----------
Total Other 7,504
* - The 'with or without' method is utilized to determine the income tax
effect of all non-GAAP adjustments.
These tables include financial measures adjusted for the impact of certain
items; these financial measures are therefore not calculated in accordance
with U.S. generally accepted accounting principles ("GAAP"). These Non-GAAP
financial measures exclude items such as: share-based compensation expense;
charges relating to restructuring initiatives; non-cash asset impairments;
certain other non-operating gains and losses; and acquisition-related items
such as transaction costs, non-cash amortization of acquired intangible
assets, and incremental transaction-related compensation.
These Non-GAAP financial measures may be different from Non-GAAP financial
measures used by other companies. Non-GAAP financial measures should not be
considered a substitute for, or superior to, measures of financial
performance prepared in accordance with GAAP. By excluding these items,
Non-GAAP financial measures are intended to facilitate meaningful
comparisons to historical operating results, competitors' operating
results, and estimates made by securities analysts. Management is evaluated
on key performance metrics including Non-GAAP Operating Income (loss),
which is used to determine management incentive compensation as well as to
forecast future periods. These Non-GAAP financial measures may be useful to
investors in allowing for greater transparency of supplemental information
used by management in its financial and operational decision-making. In
addition, similar Non-GAAP financial measures have historically been
reported to investors; the inclusion of comparable numbers provides
consistency in financial reporting. Investors are encouraged to review the
reconciliation of the Non-GAAP financial measures used in this news release
to their most directly comparable GAAP financial measures.
Veeco Instruments Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Data
(in thousands, except per share amounts)
(unaudited)
Non-GAAP Adjustments
-----------------------------------
Three months ended
September 30, Share-based
2016 GAAP Compensation Amortization Other Non-GAAP
------------------ -------- ------------ ------------ -------- ---------
Net sales $ 85,482 $ 85,482
Gross profit 33,455 607 355 34,417
Gross margin 39.1% 40.3%
Research and
development 19,892 (993) 18,899
Selling, general,
and
administrative
and Other 19,191 (2,143) (1,368) 15,680
Net income (loss) (69,598) 3,743 5,261 58,831 (1,763)
Income (loss) per
common share:
Basic $ (1.78) $ (0.05)
Diluted (1.78) (0.05)
Weighted average
number of shares:
Basic 39,131 39,131
Diluted 39,131 39,131
Veeco Instruments Inc. and Subsidiaries
Other Non-GAAP Adjustments
(in thousands)
(unaudited)
Three months ended September 30, 2016
---------------------------------------------------------------
Asset impairment 56,035
Restructuring 1,798
Acquisition related 63
Accelerated depreciation 355
Pension termination 1,305
Non-GAAP tax adjustment * (725)
-----------
Total Other 58,831
* - The 'with or without' method is utilized to determine the income tax
effect of all non-GAAP adjustments.
These tables include financial measures adjusted for the impact of certain
items; these financial measures are therefore not calculated in accordance
with U.S. generally accepted accounting principles ("GAAP"). These Non-GAAP
financial measures exclude items such as: share-based compensation expense;
charges relating to restructuring initiatives; non-cash asset impairments;
certain other non-operating gains and losses; and acquisition-related items
such as transaction costs, non-cash amortization of acquired intangible
assets, and incremental transaction-related compensation.
These Non-GAAP financial measures may be different from Non-GAAP financial
measures used by other companies. Non-GAAP financial measures should not be
considered a substitute for, or superior to, measures of financial
performance prepared in accordance with GAAP. By excluding these items, Non-
GAAP financial measures are intended to facilitate meaningful comparisons to
historical operating results, competitors' operating results, and estimates
made by securities analysts. Management is evaluated on key performance
metrics including Non-GAAP Operating Income (loss), which is used to
determine management incentive compensation as well as to forecast future
periods. These Non-GAAP financial measures may be useful to investors in
allowing for greater transparency of supplemental information used by
management in its financial and operational decision-making. In addition,
similar Non-GAAP financial measures have historically been reported to
investors; the inclusion of comparable numbers provides consistency in
financial reporting. Investors are encouraged to review the reconciliation
of the Non-GAAP financial measures used in this news release to their most
directly comparable GAAP financial measures.
Veeco Instruments Inc. and Subsidiaries
Reconciliation of GAAP Net Income (loss) to Non-GAAP Operating Income
(loss)
(in thousands)
(unaudited)
Three months Three months
ended ended
September 30, September 30,
2017 2016
-------------- --------------
GAAP Net income (loss) $ (21,884) $ (69,598)
Share-based compensation 6,170 3,743
Amortization 12,500 5,261
Restructuring 4,143 1,798
Acquisition related 783 63
Release of inventory fair value step-up
associated with the Ultratech purchase
accounting 1,856 -
Depreciation of PP&E fair value step-up
associated with the Ultratech purchase
accounting 293 -
Accelerated depreciation - 355
Asset impairment 2 56,035
Pension termination - 1,305
Interest (income) expense 4,748 (260)
Income tax expense (benefit) (1,790) 1,136
------------------------------
Non-GAAP Operating Income (loss) $ 6,821 $ (162)
==============================
This table includes financial measures adjusted for the impact of certain
items; these financial measures are therefore not calculated in accordance
with U.S. generally accepted accounting principles ("GAAP"). These Non-GAAP
financial measures exclude items such as: share-based compensation expense;
charges relating to restructuring initiatives; non-cash asset impairments;
certain other non-operating gains and losses; and acquisition-related items
such as transaction costs, non-cash amortization of acquired intangible
assets, and incremental transaction-related compensation.
These Non-GAAP financial measures may be different from Non-GAAP financial
measures used by other companies. Non-GAAP financial measures should not be
considered a substitute for, or superior to, measures of financial
performance prepared in accordance with GAAP. By excluding these items, Non-
GAAP financial measures are intended to facilitate meaningful comparisons to
historical operating results, competitors' operating results, and estimates
made by securities analysts. Management is evaluated on key performance
metrics including Non-GAAP Operating Income (loss), which is used to
determine management incentive compensation as well as to forecast future
periods. These Non-GAAP financial measures may be useful to investors in
allowing for greater transparency of supplemental information used by
management in its financial and operational decision-making. In addition,
similar Non-GAAP financial measures have historically been reported to
investors; the inclusion of comparable numbers provides consistency in
financial reporting. Investors are encouraged to review the reconciliation
of the Non-GAAP financial measures used in this news release to their most
directly comparable GAAP financial measures.
Veeco Instruments Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Data
(in millions, except per share amounts)
(unaudited)
Non-GAAP Adjustments
--------------------------------
Guidance for
the three
months ended
December 31, Share-based
2017 GAAP Compensation Amortization Other Non-GAAP
---------------------------- -------------------------------- -------------
Net sales $ 135 - $ 155 135 - 155
Gross profit 52 - 63 1 - - 53 - 64
Gross margin 39% - 41% 39%- 41%
Net income
(loss) $ (15) - $ (8) 5 12 (2) - - 7
Income (loss)
per diluted (0.3 (0.1
common share $ 3) - $ 7) $ - - $0.16
Weighted
average
number of
shares 47 47 47 47
Veeco Instruments Inc. and Subsidiaries
Reconciliation of GAAP Net Income (loss) to Non-GAAP Operating Income
(Loss)
(in millions)
(unaudited)
Guidance for the three months ended December
31, 2017
---------------------------------------------
GAAP Net income (loss) $ (15) - $ (8)
Share-based compensation 5 - 5
Amortization 12 - 12
Restructuring 1 - 1
Acquisition related 1 - 1
Interest expense, net 5 - 5
Income tax expense (benefit) (4) - (4)
----------- -----------
Non-GAAP Operating Income $ 5 - $ 12
=========== ===========
Note: Amounts may not calculate precisely due
to rounding.
These table includes financial measures adjusted for the impact of certain
items; these financial measures are therefore not calculated in accordance
with U.S. generally accepted accounting principles ("GAAP"). These Non-GAAP
financial measures exclude items such as: share-based compensation expense;
charges relating to restructuring initiatives; non-cash asset impairments;
certain other non-operating gains and losses; and acquisition-related items
such as transaction costs, non-cash amortization of acquired intangible
assets, and incremental transaction-related compensation.
These Non-GAAP financial measures may be different from Non-GAAP financial
measures used by other companies. Non-GAAP financial measures should not be
considered a substitute for, or superior to, measures of financial
performance prepared in accordance with GAAP. By excluding these items, Non-
GAAP financial measures are intended to facilitate meaningful comparisons to
historical operating results, competitors' operating results, and estimates
made by securities analysts. Management is evaluated on key performance
metrics including Non-GAAP Operating Income (loss), which is used to
determine management incentive compensation as well as to forecast future
periods. These Non-GAAP financial measures may be useful to investors in
allowing for greater transparency of supplemental information used by
management in its financial and operational decision-making. In addition,
similar Non-GAAP financial measures have historically been reported to
investors; the inclusion of comparable numbers provides consistency in
financial reporting. Investors are encouraged to review the reconciliation
of the Non-GAAP financial measures used in this news release to their most
directly comparable GAAP financial measures.
Veeco Contacts:Investors: Suzanne Schmidt 516-677-0200 x1272 sschmidt@veeco.comMedia: Jeffrey Pina 516-677-0200 x1222 jpina@veeco.com
Source: Veeco Instruments Inc.