Nova Announces $15.2m Revenues and $2.7m Net Income in the Fourth Quarter of 2009
Profitability Swings From $5.4 Million Net Loss in 2008 to $2.6 Million Net Income in 2009; Company Expects Significant Increase in Revenues and Profitability in 2010
REHOVOT, Israel, February 17, 2010 /PRNewswire-FirstCall/ -- Nova Measuring Instruments Ltd. (Nasdaq: NVMI), provider of leading edge stand alone metrology and the market leader of integrated metrology solutions to the semiconductor process control market, today reported its 2009 fourth quarter and full year financial results.
Highlights for the Fourth Quarter of 2009
- Revenues of $15.2 million, up 34% sequentially and 145% from the fourth
quarter of 2008
- Gross margin of 49%, up from 48% in the third quarter of 2009 and 22%
in the fourth quarter of 2008
- Record quarterly GAAP net income of $2.7 million or $0.13 per diluted
share
- $2.1 million positive operating cash flow
- Record quarterly bookings
Highlights for full year 2009 results
- Revenues of $39.3 million
- Gross margin of 45%, up from 33% in 2008
- Reduced operating expenses by 24% versus 2008
- GAAP net income of $2.6 million, or $0.13 per diluted share
- Significantly increased market share in all served markets
2009 Fourth Quarter Results
Total revenues for the fourth quarter of 2009 were $15.2 million, an increase of 145% relative to the fourth quarter of 2008, and an increase of 34% relative to the third quarter of 2009.
Gross margin for the fourth quarter of 2009 was 49%, compared with 22% in the fourth quarter of 2008 and 48% in the third quarter of 2009.
Operating expenses in the fourth quarter of 2009 were $4.7 million, compared with $4.4 million in the fourth quarter of 2008 and $4.0 million in the third quarter of 2009.
On a GAAP basis, the Company reported quarterly net income of $2.7 million in the fourth quarter of 2009, or $0.13 per diluted share. This compares to a GAAP net loss of $1.6 million, or $0.08 per share, for the fourth quarter of 2008, and a net income of $1.7 million, or $0.08 per diluted share, for the third quarter of 2009.
On a non-GAAP basis, which excludes stock-based compensation and other charges, the Company reported quarterly net income of $2.8 million in the fourth quarter of 2009, or $0.13 per diluted share. This compares with a non-GAAP net loss of $2.3 million, or $0.12 per share, in the fourth quarter of 2008, and non-GAAP net income of $1.8 million, or $0.09 per diluted share, in the third quarter of 2009.
The company generated $2.1 million in cash from operating activities during the fourth quarter of 2009.
2009 Full Year Results
Total revenues for 2009 were $39.3 million, as compared with total revenues of $39.0 million for 2008.
Gross margin in 2009 was 45%, as compared to 33% in 2008.
Operating expenses in 2009 were $15.1 million, as compared with $20.0 million in 2008.
On a GAAP basis, the Company reported $2.6 million net income in 2009, or $0.13 per diluted share, as compared to a net loss of $5.4 million, or $0.28 per share, in 2008.
On a non-GAAP basis, which excludes stock-based compensation and other charges, the company reported net income of $3.1 million, or $0.15 per diluted share, for 2009. This compares with a non-GAAP net loss of $4.2 million, or $0.22 per share, in 2008.
During 2009, the company used $1.8 million in cash flow for operating activities, as compared to $3.3 million cash flow used for operating activities in 2008.
Total cash reserves at the end of 2009 were $19.0 million, a decrease of $0.9 million compared to the end of 2008. On February 9, 2010, the company completed a follow-on offering of approximately 4.4 million shares. Including approximately $17 million net proceeds from the offering, the Company's cash reserves increased to about $36 million.
Management Comments
"Fourth quarter results showed a significant sequential improvement and a very strong finish for the year as a whole," commented Gabi Seligsohn, President and CEO of Nova. "As a result of our market share gains and improved business model, we were able to increase our annual revenues while the overall industry shrank by approximately 50% year over year. In parallel, we improved our products gross margins while reducing our operating expenses by 24% versus 2008, achieving a 7% net profit margin for the year."
"Looking forward, we expect further growth to be driven by the improving industry fundamentals as well as the disruptive nature of our technology which is expanding our fab footprint and displacing traditional metrology techniques. While the pace of growth will require some increase in operating expenses in 2010, we expect to be able to grow profits faster than revenues, leading to an expansion of our net profit margin compared to 2009."
Guidance for year 2010
The company's guidance for 2010 is revenues of $58-$63 million and net profitability of 10%-14%.
The Company will host a conference call today, February 17, 2010, at 10:00am ET. To participate, please dial in the US: 1-800-994-4498; or internationally: +972-3-918-0650. A recording of the call will be available on Nova's website, within 24 hours following the end of the call.
In addition, the conference call will also be webcast live from a link on Nova's website at http://www.nova.co.il.
This press release provides financial measures that exclude non-cash charges for stock-based compensation, inventory write-off and impairment charges 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 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.
About Nova
Nova Measuring Instruments Ltd. develops, produces and markets advanced integrated and stand alone metrology solutions for the semiconductor manufacturing industry. Nova is traded on the NASDAQ & TASE under the symbol NVMI. The Company's website is http://www.nova.co.il.
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 trends, demand for our products, expected deliveries, transaction, expected revenues, operating results, earnings 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. These risks and other factors include but are not limited to: unanticipated consequences of the global economic crisis, our dependency on a single integrated process control product line; the highly cyclical nature of the markets we target; 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; risks associated with our dependence on a single manufacturing facility; our ability to expand our manufacturing capacity or marketing efforts to support our future growth; our dependency on a small number of large customers and small number of suppliers; risks related to our intellectual property; changes in customer demands for our products; new product offerings from our competitors; changes in or an inability to execute our business strategy; unanticipated manufacturing or supply problems; changes in tax requirements; changes in customer demand for our products; risks related to currency fluctuations; 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 31,2008 filed with the Securities and Exchange Commission on March 30, 2009. 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.
NOVA MEASURING INSTRUMENTS LTD.
CONSOLIDATED BALANCE SHEET
(U.S. dollars in thousands)
As of December 31,
2009 2008
CURRENT ASSETS
Cash and cash equivalents 9,861 19,325
Short-term interest-bearing bank deposits 8,607 97
Trade accounts receivable 11,545 2,783
Inventories 3,949 6,862
Other current assets 1,728 1,086
35,690 30,153
LONG-TERM ASSETS
Long-term interest-bearing bank deposits 561 544
Other Long-term assets 142 157
Severance pay funds 2,368 2,141
3,071 2,842
FIXED ASSETS, NET 2,163 2,796
Total assets 40,924 35,791
CURRENT LIABILITIES
Trade accounts payable 3,715 3,480
Deferred income 1,671 2,385
Other current liabilities 5,237 4,042
10,623 9,907
LONG-TERM LIABILITIES
Liability for employee severance pay 3,168 3,152
Deferred income 183 351
Other long-term liability 35 40
3,386 3,543
SHAREHOLDERS' EQUITY 26,915 22,341
Total liabilities and shareholders' equity 40,924 35,791
NOVA MEASURING INSTRUMENTS LTD.
QUARTERLY CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except per share data)
Three months ended
December 31, September 30, December 31,
2009 2009 2008
REVENUES
Product sales 12,646 8,717 3,028
Services 2,594 2,677 3,200
15,240 11,394 6,228
COST OF REVENUES
Product sales 5,399 3,699 1,643
Inventory write-off and
inventory purchase
commitments losses -- -- 550
Services 2,445 2,191 2,696
7,844 5,890 4,889
GROSS PROFIT 7,396 5,504 1,339
OPERATING EXPENSES
Research & Development
expenses, net 2,049 1,850 2,223
Sales & Marketing expenses 2,025 1,523 1,390
General & Administration
expenses 659 594 738
4,733 3,967 4,351
OPERATING PROFIT (LOSS) 2,663 1,537 (3,012)
Interest income, net 31 153 75
Gain on short-term
investments -- -- 1,366
NET INCOME (LOSS) FOR THE
PERIOD 2,694 1,690 (1,571)
Net income (loss) per
share:
Basic 0.14 0.09 (0.08)
Diluted 0.13 0.08 (0.08)
Shares used for
calculation of net income
(loss) per share:
Basic 19,717 19,417 19,378
Diluted 21,173 19,942 19,378
NOVA MEASURING INSTRUMENTS LTD.
YEAR TO DATE CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except per share data)
Year ended December 31,
2009 2008
REVENUES
Product sales 29,639 25,673
Services 9,679 13,296
39,318 38,969
COST OF REVENUES
Product sales 12,732 12,527
Inventory write-off and inventory purchase
commitments losses -- 1,400
Services 8,999 12,059
21,731 25,986
GROSS PROFIT 17,587 12,983
OPERATING EXPENSES
Research & Development expenses, net 6,865 8,606
Sales & Marketing expenses 6,014 7,503
General & Administration expenses 2,240 3,199
Impairment loss on equipment related to
Hypernex assets and liabilities
acquisition -- 633
15,119 19,941
OPERATING PROFIT (LOSS) 2,468 (6,958)
Interest income, net 163 171
Gain on short-term investments -- 1,366
NET INCOME (LOSS) FOR THE YEAR 2,631 (5,421)
Net income (loss) per share:
Basic 0.14 (0.28)
Diluted 0.13 (0.28)
Shares used for calculation of net income
(loss) per share:
Basic 19,473 19,369
Diluted 20,089 19,369
NOVA MEASURING INSTRUMENTS LTD.
QUARTERLY CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Three months ended
December 31, September 30, December 31,
2009 2009 2008
CASH FLOW - OPERATING ACTIVITIES
Net income (loss) for the period 2,694 1,690 (1,571)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Depreciation and amortization 347 311 315
Impairment loss on equipment -- -- 10
Amortization of deferred
stock-based compensation 118 130 114
Decrease in liability for employee
termination benefits, net (187) (2) (61)
Gain on short-term investments -- -- (1,366)
Net recognized losses on
investments -- 4 49
Decrease (increase) in trade
accounts receivables (5,943) (622) 2,465
Decrease in inventories 749 790 759
Decrease (increase) in other
current and long term
assets (555) 45 40
Increase (decrease) in trade
accounts payables
and other long-term liabilities 2,198 (662) (452)
Increase (decrease) in other
current liabilities 1,769 1,039 (253)
Increase (decrease) in short and
long term deferred income 913 (857) (740)
Net cash from (used in) operating
activities 2,103 1,866 (691)
CASH FLOW - INVESTMENT ACTIVITIES
Decrease (increase) in short-term
interest-bearing
bank deposits (8,560) -- 21
Decrease in short-term investments -- 4,595 8,586
Proceeds (investments) in long-term
interest-bearing bank deposits (36) (2) 2,928
Additions to fixed assets (303) (72) (40)
Net cash from (used in) investment
activities (8,899) 4,521 11,495
CASH FLOW - FINANCING ACTIVITIES
Shares issued under employee
share-based plans 1,111 142 --
Net cash from investment activities 1,111 142 --
Increase (decrease) in cash and
cash equivalents (5,685) 6,529 10,804
Cash and cash equivalents -
beginning of period 15,546 9,017 8,521
Cash and cash equivalents - end of
period 9,861 15,546 19,325
NOVA MEASURING INSTRUMENTS LTD.
YEAR TO DATE CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Year ended December 31,
2009 2008
CASH FLOW - OPERATING ACTIVITIES
Net income (loss) for the year 2,631 (5,421)
Adjustments to reconcile net income (loss) to
net cash used in operating activities:
Depreciation and amortization 1,254 1,320
Impairment loss on equipment -- 643
Amortization of deferred stock-based
compensation 454 556
Increase (decrease) in liability for employee
termination benefits, net (159) 33
Gain on short-term investments -- (1,366)
Net recognized losses on investments -- 66
Decrease (increase) in trade accounts
receivables (8,762) 6,363
Decrease in inventories 2,695 1,330
Decrease (increase) in other current and long
term assets (421) 247
Decrease (increase) in trade accounts payables
and other long term liabilities 234 (4,013)
Increase (decrease) in other current liabilities 1,169 (3,371)
Increase (decrease) in short and long term
deferred income (882) 339
Net cash used in operating activities (1,787) (3,274)
CASH FLOW - INVESTMENT ACTIVITIES
Increase in short-term interest-bearing bank (8,510) (97)
deposits
Increase in short-term and long-term investments -- 32
Proceeds from held to maturity securities -- 3,701
Proceeds from (investments in) long-term
interest-bearing bank deposits and long-term
investments (17) 4,571
Additions to fixed assets (403) (944)
Net cash from (used in) investment activities (8,930) 7,263
CASH FLOW - FINANCING ACTIVITIES
Shares issued under employee share-based plans 1,253 12
Net cash from financing activities 1,253 12
Increase (decrease) in cash and cash equivalents (9,464) 4,001
Cash and cash equivalents - beginning of year 19,325 15,324
Cash and cash equivalents - end of year 9,861 19,325
NOVA MEASURING INSTRUMENTS LTD.
DISCLOSURE OF NON-GAAP NET INCOME (LOSS)
(U.S. dollars in thousands, except per share data)
Three months ended
December 31, September 30, December 31,
2009 2009 2008
GAAP Net income (loss) for the
period 2,694 1,690 (1,571)
Non-GAAP Adjustments:
Stock based compensation expenses 118 130 114
Inventory write-off and inventory
purchase commitments losses -- -- 550
Gain on short term investments -- -- (1,366)
Non-GAAP Net income (loss) for the
period 2,812 1,820 (2,273)
Non-GAAP net income (loss) per
share:
Basic 0.14 0.09 (0.12)
Diluted 0.13 0.09 (0.12)
Shares used for calculation of
non-GAAP net income (loss) per
share:
Basic 19,717 19,417 19,378
Diluted 21,173 19,942 19,378
Year ended December 31,
2009 2008
GAAP Net (income) loss for the year 2,631 (5,421)
Non-GAAP Adjustments:
Stock based compensation expenses 454 556
Inventory write-off and inventory
purchase commitments losses -- 1,400
Impairment loss on equipment related to
Hypernex assets and liabilities
acquisition -- 633
Gain on short term investments -- (1,366)
Non-GAAP Net income (loss) for the year 3,085 (4,198)
Non-GAAP net income (loss) per share:
Basic 0.16 (0.22)
Diluted 0.15 (0.22)
Shares used for calculation of non-GAAP
net income (loss) per share
Basic 19,473 19,369
Diluted 20,089 19,369
Company Contact: Investor relations Contacts:
Dror David, Chief Financial Officer Ehud Helft / Kenny Green
Nova Measuring Instruments Ltd. CCG Investor Relations
Tel: +972-8-938-7505 Tel: +1-646-201-9246
E-mail: [email protected] E-mail: [email protected]
http://www.nova.co.il
SOURCE Nova Measuring Instruments Ltd
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