July 30, 2013

Nanometrics Reports Second Quarter 2013 Financial Results

MILPITAS, Calif., July 30, 2013 (GLOBE NEWSWIRE) -- Nanometrics Incorporated (Nasdaq:NANO), a leading provider of advanced process control metrology and inspection systems, today announced financial results for its second quarter ended June 29, 2013.

Second Quarter Highlights

  • Order received from a leading pure-play foundry in Asia for an Atlas® II system with NanoDiffract® OCD (optical critical dimension) software for 20nm pilot production
  • Qualification of multiple UniFire™ systems by a new pure-play foundry customer at multiple global fab locations, addressing through-silicon-via metrology for advanced 3D packaging as well as critical front-end-of-line topography control for 20nm devices;
  • Receipt of multiple IMPULSE® orders for the fan-out of integrated metrology control of critical layer etch processes for the first phase of the 20nm ramp at a leading pure-play foundry; and
  • NanoDiffract OCD software selected by a leading memory customer for the 2014 upgrade of their global fleet of IMPULSE integrated metrology modules, in support of high-volume production of 2X/2Y DRAM and 1X/1Y NAND devices.
 
GAAP Results
       
  Q2 2013 Q1 2013 Q2 2012
       
Revenues  $ 34,552  $ 24,552  $ 53,181
       
Gross Profit  $ 14,480  $ 10,486  $ 24,759
       
Income (Loss) from Operations  $ (6,156)  $ (9,603)  $ 4,296
       
Net Income (Loss)  $ (4,566)  $ (5,582)  $ 4,506
       
Earnings (Loss) per Diluted Share  $ (0.20)  $ (0.24)  $ 0.19
       
 
Non-GAAP Results
       
  Q2 2013 Q1 2013 Q2 2012
       
Gross Profit  $ 15,127  $ 11,144  $ 25,396
       
Income (Loss) from Operations  $ (5,314)  $ (8,747)  $ 5,128
       
Net Income (Loss)  $ (4,023)  $ (5,032)  $ 3,079
       
Earnings (Loss) per Diluted Share  $ (0.17)  $ (0.22)  $ 0.13

A reconciliation between GAAP operating results and non-GAAP operating results is provided following the financial statements that are part of this release and on the investor page of our website. Non-GAAP results for all periods presented exclude the impact of amortization of acquired intangible assets and certain discrete tax items.

Commenting on the company's results, president and chief executive officer Dr. Timothy J. Stultz said, "Increased spending by our largest customers and resumption of investments in memory devices led to 41% growth in revenues -- and a doubling in product sales -- over the previous quarter. During the second quarter we also saw meaningful progress against a number of our strategic objectives, including increased adoption of our leading-edge products by pure-play foundry customers. Looking forward, we continue to see improvement in our business outlook, growth in second half revenues over the first half, and an optimistic outlook for 2014 driven by investments in emerging technologies and increasing capacity across all device types."

Second Quarter 2013 Summary

Revenues for the second quarter of 2013 were $34.6 million, up 41% from $24.6 million in the first quarter of 2013 and down 35% from $53.2 million in the second quarter of 2012.  Gross margin was 41.9% compared to 42.7% in the prior quarter and 46.6% in the year-ago period. The operating loss was $6.2 million compared to an operating loss of $9.6 million in the prior quarter and operating income of $4.3 million in the year-ago period. The net loss was $4.6 million or $0.20 per share, compared to a net loss of $5.6 million or $0.24 per share in the prior quarter and net income of $4.5 million or $0.19 per diluted share in the second quarter of 2012.

On a non-GAAP basis, which excludes the impact of amortization of acquired intangible assets, gross margin was 43.8% compared to 45.4% in the prior quarter and 47.8% in the year-ago period. The operating loss was $5.3 million, compared to an operating loss of $8.7 million in the prior quarter and operating income of $5.1 million in the second quarter of 2012. The non-GAAP net loss, which also adjusts for the income tax effect of non-GAAP adjustments as well as discrete tax items, was $4.0 million or $0.17 per share, compared to a net loss of $5.0 million or $0.22 per share in the prior quarter and net income of $3.1 million or $0.13 per diluted share in the second quarter of 2012.

Balance Sheet Strength

At June 29, 2013, Nanometrics had $86.3 million in cash, cash equivalents and marketable securities and $143.5 million in working capital.  Stockholders' equity, excluding intangible assets, was $183.8 million, or $7.93 per share based on 23.2 million shares outstanding at quarter end.

Business Outlook

Management expects total revenues for the third quarter of 2013 to be in the range of $36 to $40 million, with GAAP gross margin in the range of 41% to 45%, non-GAAP gross margin in the range of 43% to 47%, and operating expenses up $0.2 to $0.9 million from the second quarter.  Management expects the third quarter GAAP net loss to be $0.16 to $0.05 per share and the non-GAAP net loss to be $0.14 to $0.03 per share.

Conference Call Details

A conference call to discuss second quarter 2013 results will be held today at 4:30 p.m. EDT (1:30 p.m. PDT). To participate in the conference call, the dial-in numbers are (877) 374-4041 for domestic callers and (253) 237-1156 for international callers. A live and recorded webcast and supplemental financial information will be made available on the investor page of the Nanometrics website at www.nanometrics.com.

Use of Non-GAAP Financial Information

Financial results such as non-GAAP gross profit, gross margin, operating income, net income, and net income per share, which exclude certain expenses, charges and special items, were not prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP). Management uses non-GAAP financial results, which exclude acquisition-related expenses such as amortization of acquired intangibles and transaction costs, asset impairments, restructuring charges, legal settlements, certain discrete tax items and the impact of the timing of the approval of elections related to tax treatment of certain foreign subsidiaries, and other unusual and infrequent items to evaluate the company's ongoing performance and to enable comparison to other periods that did not include these unusual and infrequent items. The company believes the presentation of non-GAAP results is useful to investors for analyzing ongoing business trends, comparing performance to prior periods, and enhancing the investor's ability to view the company's results from management's perspective. A table presenting a reconciliation of GAAP results to non-GAAP results is included at the end of this press release and is available on the investor page of the Nanometrics website at www.nanometrics.com.

About Nanometrics

Nanometrics is a leading provider of advanced, high-performance process control metrology and inspection systems used primarily in the fabrication of semiconductors and other solid-state devices, such as data storage components and discretes including high-brightness LEDs and power management components. Nanometrics' automated and integrated metrology systems measure critical dimensions, device structures, overlay registration, topography and various thin film properties, including film thickness as well as optical, electrical and material properties. The company's process control solutions are deployed throughout the fabrication process, from front-end-of-line substrate manufacturing, to high-volume production of semiconductors and other devices, to advanced wafer-scale packaging applications. Nanometrics' systems enable advanced process control for device manufacturers, providing improved device yield at reduced manufacturing cycle time, supporting the accelerated product life cycles in the semiconductor market. The company maintains its headquarters in Milpitas, California, with sales and service offices worldwide. Nanometrics is traded on NASDAQ Global Select Market under the symbol NANO. Nanometrics' website is http://www.nanometrics.com.

Forward Looking Statements

This press release contains forward-looking statements including, but not limited to, statements included in the quotation from management and statements included in the business outlook section, such as the statements regarding future financial results, including revenue, margins and profitability, customer spending and future levels of business. These forward-looking statements may also be identified by words such as "expect," "anticipate," "believe," "estimate," "forecasts," "looking forward" "plan," "predict," "see," "view," and similar terms. Although Nanometrics believes that the expectations reflected in the forward-looking statements are reasonable, actual results could differ materially from these expectations due to a variety of factors, including economic conditions, levels of industry spending, shifts in the timing of customer orders and product shipments, market adoption rates, changes in product mix and changes in operating expenses. For additional information and considerations regarding the risks faced by Nanometrics, see its annual report on Form 10-K for the year ended December 29, 2012 as filed with the Securities and Exchange Commission on March 12, 2013, as well as other periodic reports filed with the SEC from time to time. Nanometrics disclaims any obligation to update information contained in any forward-looking statement.  

NANOMETRICS INCORPORATED
CONSOLIDATED BALANCE SHEETS
(In thousands except share amounts)
(Unaudited)
     
   As of Jun 29,   As of Dec 29, 
  2013 2012
     
ASSETS    
Current assets:    
Cash and cash equivalents   $ 39,102  $ 62,915
Marketable securities  47,162  46,993
Accounts receivable, net of allowances of $174 and $82, respectively  32,191  21,388
Inventories   39,248  39,659
Inventories-delivered systems   2,444  2,274
Prepaid expenses and other   8,221  7,492
Deferred income tax assets   15,083  8,593
Total current assets   183,451  189,314
     
Property, plant and equipment, net   43,831  43,213
Goodwill  11,255  11,352
Intangible assets, net   9,226  10,980
Deferred income tax assets  3,582  3,671
Other assets   680  924
Total assets   $ 252,025  $ 259,454
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Current liabilities:    
Accounts payable   $ 8,630  $ 6,398
Accrued payroll and related expenses   5,466  6,670
Deferred revenue   11,847  8,485
Other current liabilities   8,929  7,822
Income taxes payable   244  424
Current portion of debt obligations   4,846  928
Total current liabilities   39,962  30,727
     
Deferred revenue  3,459  4,307
Income taxes payable  2,280  2,135
Other long-term liabilities   2,070  2,140
Debt obligations  --   4,374
Total liabilities   47,771  43,683
     
Stockholders' equity:    
Common stock, $0.001 par value, 47,000,000 shares authorized; 23,186,957 and 23,250,429, respectively, issued and outstanding   23  23
Additional paid-in capital   238,939  238,326
Accumulated deficit   (33,998)  (23,850)
Accumulated other comprehensive income  (710)  1,272
Total stockholders' equity   204,254  215,771
Total liabilities and stockholders' equity   $ 252,025  $ 259,454
 
NANOMETRICS INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except per share amounts)
(Unaudited)
         
  Three Months Ended Six Months Ended
  Jun 29, Jun 30, Jun 29, Jun 30,
  2013 2012 2013 2012
Net revenues:        
Products   $ 26,533  $ 41,556  $ 39,612  $ 89,414
Service   8,019  11,625  19,492  19,259
Total net revenues   34,552  53,181  59,104  108,673
         
Costs of net revenues:        
Cost of products   14,832  22,627  22,792  47,446
Cost of service   4,593  5,158  10,041  10,128
Amortization of intangible assets  647  637  1,305  1,274
Total costs of net revenues   20,072  28,422  34,138  58,848
Gross profit   14,480  24,759  24,966  49,825
         
Operating expenses:        
Research and development   8,321  7,644  15,768  15,120
Selling   6,613  7,041  13,545  14,252
General and administrative   5,507  5,583  11,019  11,664
Amortization of intangible assets   195  195  393  387
Total operating expenses  20,636  20,463  40,725  41,423
Income (loss) from operations   (6,156)  4,296  (15,759)  8,402
         
Other income (expense):        
Interest income   20  33  45  85
Interest expense   (205)  (264)  (431)  (533)
Other expense, net   (637)  (49)  (597)  (224)
Total other expense, net   (822)  (280)  (983)  (672)
         
Income (loss) before income taxes   (6,978)  4,016  (16,742)  7,730
Provision for (benefit from) income taxes   (2,412)  (490)  (6,594)  1,521
Net income (loss)  $ (4,566)  $ 4,506  $ (10,148)  $ 6,209
         
Net income (loss) per share:        
Basic   $ (0.20)  $ 0.19  $ (0.44)  $ 0.27
Diluted   $ (0.20)  $ 0.19  $ (0.44)  $ 0.26
         
Shares used in per share calculation:        
Basic   23,138  23,395  23,240  23,372
Diluted   23,138  23,877  23,240  23,924
 
NANOMETRICS INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
     
  Six-month period ended
  June 29, June 30,
  2013 2012
Cash flows from operating activities:    
Net income (loss)  $ (10,148)  $ 6,209
Reconciliation of net income (loss) to net cash provided by (used in) operating activities:    
Depreciation and amortization 4,268 3,857
Stock-based compensation 3,208 3,054
Excess tax benefit from equity awards 367 (814)
Loss on disposal of fixed assets 10 134
Inventory write down 2,764 1,740
Deferred income taxes (6,657) 995
Changes in fair value of contingent consideration 1,000 9
Changes in assets and liabilities:    
Accounts receivable (11,095) (11,141)
Inventories (4,121) (1,475)
Inventories- delivered systems (170) (229)
Prepaid expenses and other (109) (1,798)
Accounts payable, accrued and other liabilities 1,566 (3,060)
Deferred revenue 2,548 4,222
Income taxes payable (389) 466
Net cash provided by (used in) operations (16,958) 2,169
     
Cash flows from investing activities:    
Maturities of marketable securities  22,788  -- 
Escrow payment received related to acquisition of Nanda  --   508
Purchases of marketable securities  (23,454)  (13,764)
Purchase of property, plant and equipment  (1,970)  (2,635)
Net cash used in investing activities  (2,636)  (15,891)
     
Cash flows from financing activities:    
Payments of contingent consideration  (216)  (198)
Repayments of debt obligations  (456)  (374)
Proceeds from sale of shares under employee stock option and purchase plans  2,858  2,632
Excess tax benefit from equity awards  (367)  814
Taxes paid on net issuance of stock awards  (86)  (16)
Repurchases of common stock  (5,000)  (4,960)
Net cash used in financing activities  (3,267)  (2,102)
Effect of exchange rate changes on cash and cash equivalents  (952)  115
Net decrease in cash and cash equivalents  (23,813)  (15,709)
Cash and cash equivalents, beginning of period  62,915  97,699
Cash and cash equivalents, end of period  $ 39,102  $ 81,990
               
NANOMETRICS INCORPORATED
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(In thousands, except per share amounts)
(Unaudited)
               
               
  Three Months Ended   Six Months Ended
  Jun 29, Mar 30, Jun 30,   Jun 29, Jun 30,  
  2013 2013 2012   2013 2012  
Reconciliation of GAAP gross profit to non-GAAP gross profit              
GAAP gross profit  $ 14,480  $ 10,486  $ 24,759    $ 24,966  $ 49,825  
Non-GAAP adjustments:              
 Amortization of intangible assets   647  658  637    1,305  $ 1,274  
 Non-GAAP gross profit   $ 15,127  $ 11,144  $ 25,396    $ 26,271  $ 51,099  
               
Reconciliation of GAAP operating income (loss) to non-GAAP operating income (loss)              
GAAP operating income (loss)  $ (6,156)  $ (9,603)  $ 4,296    $ (15,759)  $ 8,402  
Non-GAAP adjustments:              
 Amortization of intangible assets included in cost of revenues   647  658  637    1,305  1,274  
 Amortization of intangible assets included in operating expenses   195  198  195    393  387  
 Total non-GAAP adjustments to operating income (loss)   842  856  832    1,698  1,661  
 Non-GAAP operating income (loss)   $ (5,314)  $ (8,747)  $ 5,128    $ (14,061)  $ 10,063  
               
Reconciliation of GAAP net income (loss) to non-GAAP net income (loss)              
GAAP net income (loss)  $ (4,566)  $ (5,582)  $ 4,506    $ (10,148)  $ 6,209  
Non-GAAP adjustments:              
 Total non-GAAP adjustments to non-GAAP operating income (loss)   842  856  832    1,698  1,661  
 Income tax effect of non-GAAP adjustments   (299)  (306)  (304)    (608)  (607)  
 Discrete tax adjustment   --   --   (1,955) (a)  --   (1,300) (a)
 Non-GAAP net income (loss)   $ (4,023)  $ (5,032)  $ 3,079    $ (9,058)  $ 5,963  
               
GAAP net income (loss) per diluted share  $ (0.20)  $ (0.24)  $ 0.19    $ (0.44)  $ 0.26  
               
Non-GAAP net income (loss) per diluted share  $ (0.17)  $ (0.22)  $ 0.13    $ (0.39)  $ 0.25  
               
Shares used in diluted income per share calculation  23,138  23,341  23,877    23,240  23,924  
               
               
(a) Reflects the tax benefit for certain first quarter foreign losses related to entity classification elections that were approved by the IRS in the second quarter. The tax benefit of these first quarter losses was recorded as a decrease to the second quarter tax provision on a GAAP basis.
CONTACT: Investor Relations Contact:

         Claire McAdams

         Headgate Partners LLC

         530.265.9899, 530.265.9699 fax

         email: claire@headgatepartners.com



         Company Contact:

         Ronald Kisling, CFO

         Nanometrics Incorporated

         408.545.6143, 408.521.9490 fax

         email: rkisling@nanometrics.com

company logo

Source: Nanometrics Incorporated

News Provided by Acquire Media


Close window | Back to top

Copyright 2014 Nanometrics