EX-99.1 2 a14-11916_1ex99d1.htm EX-99.1

EXHIBIT 99.1

 

   NEWS

 

FOR IMMEDIATE RELEASE

 

VEECO REPORTS FIRST QUARTER 2014 FINANCIAL RESULTS

 

Plainview, NY, May 5, 2014 — Veeco Instruments Inc. (Nasdaq: VECO) announced its financial results for the first quarter ended March 31, 2014.  Veeco reports its results on a U.S. generally accepted accounting principles (“GAAP”) basis, and also provides results excluding certain items.  Please refer to the attached table for details of the reconciliation between GAAP operating results and Non-GAAP operating results.

 

Veeco’s first quarter GAAP results include a one-time gain of $29 million from the reversal of Synos acquisition related contingency accruals since we determined that the post-closing milestones necessary to trigger such contingency payments were not expected to be achieved.

 

GAAP Results ($M except per share data)

 

 

 

Q1 ‘14

 

Q1 ‘13

 

Revenues

 

$

90.8

 

$

61.8

 

Net income (loss)

 

$

19.2

 

$

(10.1

)

Per share income (loss)

 

$

0.48

 

$

(0.26

)

 

Non-GAAP Results ($M except per share data)

 

 

 

Q1 ‘14

 

Q1 ‘13

 

Adjusted EBITA

 

$

(2.7

)

$

(15.7

)

Net income (loss)

 

$

(2.4

)

$

(7.5

)

Per share income (loss)

 

$

(0.06

)

$

(0.19

)

 

“Veeco’s first quarter top and bottom line performance improved meaningfully from the fourth quarter of last year,” commented John R. Peeler, Chairman and Chief Executive Officer. “We delivered $91 million in revenue, up 24% from the fourth quarter of 2013, driven primarily by an increase in LED & Solar revenue to $71 million ($64 million in MOCVD).  First quarter 2014 Data Storage revenues were $20 million, up from $17 million in the fourth quarter of 2013.  EBITA loss was $3 million, significantly improved from last quarter’s loss, benefiting from higher volume, an improvement in gross margins to 37%, and lower operating spending.  As forecasted, our investments in next generation products and in our growth businesses caused cash to decline modestly during the quarter. Yet our cash and investments balance remains strong at $483 million.”

 

Peeler continued, “Veeco’s first quarter 2014 orders improved by 21% from the fourth quarter of 2013 to $103 million, the highest level we have reported in nearly two years. This increase was driven by a 59% sequential improvement in MOCVD orders to $83 million, which represents the highest amount booked since the third quarter of 2011. Orders were received from top LED customers throughout Asia and elsewhere.” First quarter 2014 Data Storage and MBE orders each declined from the fourth quarter of 2013, to $15 million and $5 million, respectively.

 

Second Quarter 2014 Guidance and Outlook

 

Veeco’s second quarter 2014 revenue is currently forecasted to be between $87 million and $97 million. Earnings per share are currently forecasted to be between ($0.46) to ($0.36) on a GAAP basis, and ($0.23) to ($0.14) on a non-GAAP basis. Please refer to the attached financial table for more details.

 

Peeler commented, “After a long downturn in our MOCVD business, LED fab utilization rates have improved to high levels at most key accounts and LED adoption is happening faster than many had expected. Our customers are

 


 

also reporting better market demand for LED backlighting products. It is encouraging to see that our leading customers are beginning to place orders for capacity expansions.  We currently anticipate that Veeco’s second quarter 2014 orders will be similar to or better than first quarter orders. Yet, the timing and magnitude of key customer expansions could cause MOCVD orders to be lumpy and somewhat unpredictable on a quarterly basis, and we lack the visibility to see into the second half of the year.  We continue to invest in MOCVD product and technology development to further improve our customers’ cost of ownership and manufacturing capability.”

 

Peeler concluded “We are pleased to have made progress improving Veeco’s profitability and remain focused on our strategy to turn around our performance: 1) developing and launching game-changing new products that enable cost effective LED lighting, flexible OLED encapsulation and other emerging technologies; 2) improving customer cost of ownership as well as our gross margins; 3) driving process improvement initiatives to make us more efficient; and 4) lowering expenses.”

 

Conference Call Information

 

A conference call reviewing these results has been scheduled for 5:00pm today. To join the call, dial 1-888-601-3862 (toll free) or 1-913-981-5524 and use passcode 5588173. The call will also be webcast live on the Veeco website at www.veeco.com. A replay of the call will be available beginning at 8:00pm tonight through 8:00pm ET on May 19, 2014 at 888-203-1112 or 719-457-0820, using passcode 5588173, and on the Veeco website.

 

We will post an accompanying slide presentation to our website prior to the beginning of the call.

 

About Veeco

 

Veeco’s process equipment solutions enable the manufacture of LEDs, flexible OLEDs, solar cells, power electronics, hard drives, MEMS and wireless chips.  We are the market leader in MOCVD, MBE, Ion Beam and other advanced thin film process technologies.  Our high performance systems drive innovation in energy efficiency, consumer electronics and network storage and allow our customers to maximize productivity and achieve lower cost of ownership.  For information on our company, products and worldwide service and support, please visit www.veeco.com.

 

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, 2013 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 Contacts:

 

 

 

Investor Relations:

Media:

Debra Wasser 516-677-0200 x1472

Jeffrey Pina 516-677-0200 x1222

dwasser@veeco.com

jpina@veeco.com

 


 

Veeco Instruments Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)

 

 

 

For the three months ended

 

 

 

March 31,

 

 

 

2014

 

2013

 

 

 

 

 

 

 

Net sales

 

$

90,841

 

$

61,781

 

Cost of sales

 

57,064

 

39,229

 

Gross profit

 

33,777

 

22,552

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Selling, general and administrative

 

21,667

 

19,648

 

Research and development

 

19,768

 

20,737

 

Amortization

 

2,903

 

856

 

Restructuring

 

392

 

531

 

Total operating expenses

 

44,730

 

41,772

 

Other operating, net

 

(212

)

404

 

Changes in contingent consideration

 

(29,368

)

—

 

Operating income (loss)

 

18,627

 

(19,624

)

Interest income (expense), net

 

164

 

192

 

Income (loss) before income taxes

 

18,791

 

(19,432

)

Income tax provision (benefit)

 

(369

)

(9,361

)

Net income (loss)

 

$

19,160

 

$

(10,071

)

 

 

 

 

 

 

Income (loss) per common share:

 

 

 

 

 

Basic:

 

 

 

 

 

Income (loss)

 

$

0.49

 

$

(0.26

)

 

 

 

 

 

 

Diluted:

 

 

 

 

 

Income (loss)

 

$

0.48

 

$

(0.26

)

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

Basic

 

39,177

 

38,716

 

Diluted

 

39,937

 

38,716

 

 


 

Veeco Instruments Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands)

 

 

 

March 31,

 

December 31,

 

 

 

2014

 

2013

 

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

214,682

 

$

210,799

 

Short-term investments

 

267,402

 

281,538

 

Restricted cash

 

764

 

2,738

 

Accounts receivable, net

 

50,720

 

23,823

 

Inventories

 

52,073

 

59,726

 

Prepaid expenses and other current assets

 

28,767

 

23,303

 

Deferred income taxes

 

10,796

 

11,716

 

Total current assets

 

625,204

 

613,643

 

 

 

 

 

 

 

Property, plant and equipment at cost, net

 

86,912

 

89,139

 

Goodwill

 

91,348

 

91,348

 

Deferred income taxes

 

397

 

397

 

Intangible assets, net

 

111,814

 

114,716

 

Other assets

 

38,882

 

38,726

 

Total assets

 

$

954,557

 

$

947,969

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

28,293

 

$

35,755

 

Accrued expenses and other current liabilities

 

38,065

 

51,084

 

Customer deposits and deferred revenue

 

41,171

 

34,754

 

Income taxes payable

 

5,538

 

6,149

 

Deferred income taxes

 

159

 

159

 

Current portion of long-term debt

 

296

 

290

 

Total current liabilities

 

113,522

 

128,191

 

 

 

 

 

 

 

Deferred income taxes

 

26,325

 

28,052

 

Long-term debt

 

1,771

 

1,847

 

Other liabilities

 

498

 

9,649

 

Total liabilities

 

142,116

 

167,739

 

 

 

 

 

 

 

Equity

 

812,441

 

780,230

 

 

 

 

 

 

 

Total liabilities and equity

 

$

954,557

 

$

947,969

 

 


 

Veeco Instruments Inc. and Subsidiaries

Reconciliation of GAAP to non-GAAP results

(In thousands, except per share data)

(Unaudited)

 

 

 

For the three months ended

 

 

 

March 31,

 

 

 

2014

 

2013

 

Adjusted EBITA

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

18,627

 

$

(19,624

)

 

 

 

 

 

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

Amortization

 

2,903

 

856

 

Equity-based compensation

 

4,722

 

2,579

 

Restructuring

 

392

 

531

 

Changes in contingent consideration

 

(29,368

)

—

 

Earnings before interest, income taxes and amortization excluding certain items (“Adjusted EBITA”)

 

$

(2,724

)

$

(15,658

)

 

 

 

 

 

 

Non-GAAP Net Income (Loss)

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) (GAAP basis)

 

$

19,160

 

$

(10,071

)

 

 

 

 

 

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

Amortization

 

2,903

 

856

 

Equity-based compensation

 

4,722

 

2,579

 

Restructuring

 

392

 

531

 

Changes in contingent consideration

 

(29,368

)

—

 

Income tax effect of non-GAAP adjustments

 

(192

)

(1,372

)(1)

 

 

 

 

 

 

Non-GAAP net income (loss)

 

$

(2,383

)

$

(7,477

)

 

 

 

 

 

 

Non-GAAP earnings (loss) per diluted share excluding certain items (“Non-GAAP EPS”)

 

$

(0.06

)

$

(0.19

)

 

 

 

 

 

 

Diluted weighted average shares outstanding

 

39,177

 

38,716

 

 

(1) The Company utilized the with and without method to determine the income tax effect of non-GAAP adjustments.

 

NOTE - This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States (“GAAP”), and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on adjusted EBITA, which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes adjusted EBITA reports baseline performance and thus provides useful information.

 


 

Veeco Instruments Inc. and Subsidiaries

Segment Bookings, Revenues, and Reconciliation

of Operating Income (Loss) to Adjusted EBITA

(In thousands)

(Unaudited)

 

 

 

For the three months ended

 

 

 

March 31,

 

 

 

2014

 

2013

 

LED & Solar

 

 

 

 

 

Bookings

 

$

87,138

 

$

42,714

 

 

 

 

 

 

 

Revenues

 

$

70,755

 

$

42,307

 

 

 

 

 

 

 

Operating income (loss)

 

$

26,576

 

$

(12,887

)

Amortization

 

2,579

 

532

 

Equity-based compensation

 

2,173

 

710

 

Restructuring

 

164

 

423

 

Changes in contingent consideration

 

(29,368

)

—

 

Adjusted EBITA

 

$

2,124

 

$

(11,222

)

 

 

 

 

 

 

Data Storage

 

 

 

 

 

Bookings

 

$

15,437

 

$

27,692

 

 

 

 

 

 

 

Revenues

 

$

20,086

 

$

19,474

 

 

 

 

 

 

 

Operating income (loss)

 

$

(1,899

)

$

(129

)

Amortization

 

324

 

324

 

Equity-based compensation

 

699

 

130

 

Restructuring

 

228

 

50

 

Adjusted EBITA

 

$

(648

)

$

375

 

 

 

 

 

 

 

Unallocated Corporate

 

 

 

 

 

Operating income (loss)

 

$

(6,050

)

$

(6,608

)

Equity-based compensation

 

1,850

 

1,739

 

Restructuring

 

—

 

58

 

Adjusted EBITA

 

$

(4,200

)

$

(4,811

)

 

 

 

 

 

Total

 

 

 

 

 

Bookings

 

$

102,575

 

$

70,406

 

 

 

 

 

 

 

Revenues

 

$

90,841

 

$

61,781

 

 

 

 

 

 

 

Operating income (loss)

 

$

18,627

 

$

(19,624

)

Amortization

 

2,903

 

856

 

Equity-based compensation

 

4,722

 

2,579

 

Restructuring

 

392

 

531

 

Changes in contingent consideration

 

(29,368

)

—

 

Adjusted EBITA

 

$

(2,724

)

$

(15,658

)

 


 

Veeco Instruments Inc. and Subsidiaries

Reconciliation of GAAP to non-GAAP results

(In thousands, except per share data)

(Unaudited)

 

 

 

Guidance for

 

 

 

the three months ending
June 30, 2014

 

 

 

LOW

 

HIGH

 

Adjusted EBITA

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

$

(19,120

)

$

(15,148

)

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

Amortization

 

2,931

 

2,931

 

Equity-based compensation

 

5,340

 

5,340

 

Restructuring

 

663

 

663

 

 

 

 

 

 

 

Earnings before interest, income taxes and amortization excluding certain items (“Adjusted EBITA”)

 

$

(10,186

)

$

(6,214

)

 

 

 

 

 

 

Non-GAAP Net Income

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) (GAAP basis)

 

$

(18,234

)

$

(14,424

)

 

 

 

 

 

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

Amortization

 

2,931

 

2,931

 

Equity-based compensation

 

5,340

 

5,340

 

Restructuring

 

663

 

663

 

Income tax effect of non-GAAP adjustments

 

104

 

(81

)(1)

 

 

 

 

 

 

Non-GAAP net income (loss)

 

$

(9,196

)

$

(5,571

)

 

 

 

 

 

 

Non-GAAP earnings per diluted share excluding certain items (“Non-GAAP EPS”)

 

$

(0.23

)

$

(0.14

)

 

 

 

 

 

 

Diluted weighted average shares outstanding

 

39,720

 

39,720

 

 

(1) The Company utilizes the with and without method to determine the income tax effect of non-GAAP adjustments.

 

NOTE - This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States (“GAAP”), and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on adjusted EBITA, which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes adjusted EBITA reports baseline performance and thus provides useful information.