Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - ONTO INNOVATION INC. | a8-kq42012.htm |
 | Nanometrics Incorporated 1550 Buckeye Drive Milpitas, CA 95035 | Tel: 408.545.6000 Fax: 408.232.5910 www.nanometrics.com |
Investor Relations Contact: | Company Contact: |
Claire McAdams | Ronald Kisling, CFO |
Headgate Partners LLC | Nanometrics Incorporated |
530.265.9899, 530.265.9699 fax | 408.545.6143, 408.521.9490 fax |
email: claire@headgatepartners.com | email: rkisling@nanometrics.com |
Nanometrics Reports Fourth Quarter and Full Year 2012 Financial Results
MILPITAS, Calif., February 4, 2013 - Nanometrics Incorporated (NASDAQ: NANO), a leading provider of advanced process control metrology and inspection systems, today announced financial results for its fourth quarter and full year ended December 29, 2012.
Fourth Quarter Highlights
• | Increased penetration at major foundry customers, which together comprised 26% of product sales; |
• | Adoption of our Atlas® optical critical dimension (OCD) metrology at multiple customers for development and pilot line production of 3D memory devices; |
• | New tool-of-record selections of the UniFire system for advanced wafer scale packaging applications at multiple foundry and memory customers; |
• | Multiple Spark and UniFire systems placed for advanced lithography cluster control for inspection and metrology; and |
• | $3.5 million in stock repurchases of 250,000 shares. |
GAAP Results | |||||||||||||||||||||
Q4 2012 | Q3 2012 | Q4 2011 | FY 2012 | FY2011 | |||||||||||||||||
Revenues | $ | 30,270 | $ | 43,938 | $ | 45,277 | $ | 182,881 | $ | 230,061 | |||||||||||
Gross Profit | $ | 11,951 | $ | 22,152 | $ | 20,710 | $ | 83,928 | $ | 122,101 | |||||||||||
Income (Loss) from Operations | $ | (6,538 | ) | $ | 3,614 | $ | (528 | ) | $ | 5,478 | $ | 45,766 | |||||||||
Net Income (Loss) | $ | (3,647 | ) | $ | 1,903 | $ | (532 | ) | $ | 4,465 | $ | 28,685 | |||||||||
Earnings (Loss) per Diluted Share | $ | (0.16 | ) | $ | 0.08 | $ | (0.02 | ) | $ | 0.19 | $ | 1.22 | |||||||||
Non-GAAP Results | |||||||||||||||||||||
Q4 2012 | Q3 2012 | Q4 2011 | FY 2012 | FY2011 | |||||||||||||||||
Gross Profit | $ | 12,597 | $ | 22,781 | $ | 21,120 | $ | 86,477 | $ | 123,178 | |||||||||||
Income loss from Operations | $ | (5,696 | ) | $ | 4,436 | $ | 3,815 | $ | 8,803 | $ | 51,927 | ||||||||||
Net Income (Loss) | $ | (3,112 | ) | $ | 2,425 | $ | 2,315 | $ | 5,276 | $ | 32,695 | ||||||||||
Earnings (Loss) per Diluted Share | $ | (0.13 | ) | $ | 0.10 | $ | 0.10 | $ | 0.22 | $ | 1.39 | ||||||||||
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.
Commenting on the company's results, president and chief executive officer Dr. Timothy J. Stultz said, “In 2012 we focused on and accomplished several important objectives. We shipped and recognized revenue on our first 450mm Atlas systems, significantly increased our penetration of the foundry segment, continued to expand our installed base of UniFire systems across multiple leading customers, achieved initial penetration of the Spark system into several sites, and strengthened our position at every one of our key strategic customer accounts.
"While our year-on-year decline in revenues was primarily driven by the decline in memory spending and weakness in the LED and bare wafer silicon end markets, we did achieve significant growth in revenues to foundry customers and we had another strong year of Atlas OCD sales. Our focus today is investing in the future growth of the company with leading-edge products developed in close collaboration with the largest device manufacturers in the world. While industry conditions remain soft in the near term, we currently see encouraging signs for a substantial improvement in industry spending plans for the second half of 2013. We believe the investments we are making today will drive incremental revenue growth and allow us to outperform the industry when spending recovers."
Fourth Quarter 2012 Summary
Revenues for the fourth quarter of 2012 were $30.3 million, down 31% from $43.9 million in the third quarter and down 33% from $45.3 million in the fourth quarter of 2011. Gross margin was 39.5% compared to 50.4% in the prior quarter and 45.7% in the year-
| Nanometrics Incorporated 1550 Buckeye Drive Milpitas, CA 95035 | Tel: 408.545.6000 Fax: 408.232.5910 www.nanometrics.com |
ago period. The operating loss was $6.5 million compared to operating income of $3.6 million in the prior quarter and an operating loss of $0.5 million in the year-ago period. The net loss was $3.6 million or $0.16 per share, compared to net income of $1.9 million or $0.08 per diluted share in the prior quarter and a net loss of $0.5 million or $0.02 per share in the fourth quarter of 2011.
On a non-GAAP basis, which excludes the impact of amortization of acquired intangible assets and certain other items, gross margin was 41.6% compared to 51.8% in the prior quarter and 46.6% in the year-ago period. The decline in gross margin was primarily driven by lower factory utilization as well as an increase in warranty and other manufacturing costs. The non-GAAP operating loss was $5.7 million, compared to non-GAAP operating income of $4.4 million in the prior quarter and $3.8 million in the fourth quarter of 2011. The non-GAAP net loss was $3.1 million or $0.13 per share, compared to non-GAAP net income of $2.4 million or $0.10 per diluted share in the prior quarter and $2.3 million or $0.10 per diluted share in the third quarter of 2011.
Full Year 2012 Summary
Revenues were $182.9 million, down 21% from a record $230.1 million in 2011. Gross margin declined to 45.9% from 53.1%, and operating income was $5.5 million compared to $45.8 million in 2011. Net income was $4.5 million or $0.19 per share, compared to $28.7 million or $1.22 per diluted share in 2011.
On a non-GAAP basis, gross margin declined to 47.3% from 53.5%, and operating income was $8.8 million compared to $51.9 million in 2011. Non-GAAP net income was $5.3 million or $0.22 per diluted share, compared to $32.7 million or $1.39 per diluted share in 2011.
Balance Sheet Strength
At December 29, 2012, Nanometrics had $109.9 million in cash, cash equivalents and marketable securities and $159.4 million in working capital. Stockholders' equity, excluding intangible assets, was $194.2 million, or $8.35 per share based on 23.3 million shares outstanding at year end.
Business Outlook
Management forecasts continued declines in spending by its largest customers in the first quarter of 2013, with total revenues expected to be in the range of $24 to $28 million. Management expects GAAP gross margin in the range of 34% to 41%, non-GAAP gross margin in the range of 35% to 42%, and operating expenses to increase between $2.0 and $3.1 million from the fourth quarter. The expected increase in operating expenses is primarily due to incremental R&D and applications investments in support of customer engagements at leading edge device nodes. Management expects the first quarter GAAP net loss to be in the range of $0.27 to $0.35 per share and the non-GAAP net loss to be in the range of $0.25 to $0.33 per share.
Conference Call Details
A conference call to discuss fourth quarter and full year 2012 results will be held today at 4:30 p.m. EST (1:30 p.m. PST). 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 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, 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, high-brightness LEDs, data storage devices and solar photovoltaics. Nanometrics' automated and integrated systems address numerous process control applications, including critical dimension and film thickness measurement, device topography, defect inspection, overlay registration, and analysis of various other film properties such as optical, electrical and material characteristics. 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 device manufacturers to improve yields, increase productivity and lower their manufacturing costs. 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.
| Nanometrics Incorporated 1550 Buckeye Drive Milpitas, CA 95035 | Tel: 408.545.6000 Fax: 408.232.5910 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 revenue, margins, profitability, opportunities, areas of market growth, customer demand and product adoption. These forward-looking statements may also be identified by words such as “expect,” “anticipate,” “believe,” “estimate,” “forecasts,” “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, our ability to implement supply cost reductions, and increased 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 31, 2011 as filed with the Securities and Exchange Commission, 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 1550 Buckeye Drive Milpitas, CA 95035 | Tel: 408.545.6000 Fax: 408.232.5910 www.nanometrics.com |
NANOMETRICS INCORPORATED
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
(Unaudited)
As of Dec 29, | As of Dec 31, | ||||||||
2012 | 2011 | ||||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | $ | 62,915 | $ | 97,699 | |||||
Marketable securities | 46,993 | — | |||||||
Accounts receivable, net of allowances of $82 and $117, respectively | 21,388 | 29,289 | |||||||
Inventories | 39,659 | 52,260 | |||||||
Inventories-delivered systems | 2,274 | 1,637 | |||||||
Prepaid expenses and other | 7,492 | 8,119 | |||||||
Deferred income tax assets | 8,593 | 12,406 | |||||||
Total current assets | 189,314 | 201,410 | |||||||
Property, plant and equipment, net | 43,213 | 35,521 | |||||||
Goodwill | 11,352 | 11,990 | |||||||
Intangible assets, net | 10,980 | 14,394 | |||||||
Deferred income tax assets, non-current | 3,671 | 2,864 | |||||||
Other assets | 924 | 1,042 | |||||||
Total assets | $ | 259,454 | $ | 267,221 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 6,398 | $ | 7,975 | |||||
Accrued payroll and related expenses | 5,897 | 8,837 | |||||||
Deferred revenue | 8,485 | 5,788 | |||||||
Other current liabilities | 7,822 | 16,709 | |||||||
Income taxes payable | 424 | 707 | |||||||
Current portion of debt obligations | 928 | 765 | |||||||
Total current liabilities | 29,954 | 40,781 | |||||||
Deferred revenue, non-current | 4,307 | 4,547 | |||||||
Income taxes payable, non-current | 2,135 | 2,401 | |||||||
Other non - current liabilities | 2,140 | 2,813 | |||||||
Debt obligations, net of current portion | 4,374 | 6,687 | |||||||
Total liabilities | 42,910 | 57,229 | |||||||
Stockholders’ equity: | |||||||||
Common stock, $0.001 par value, 47,000,000 shares | |||||||||
authorized; 23,250,429 and 23,182,771, respectively, | |||||||||
issued and outstanding | 23 | 23 | |||||||
Additional paid-in capital | 239,099 | 236,735 | |||||||
Accumulated deficit | (23,850 | ) | (28,315 | ) | |||||
Accumulated other comprehensive income | 1,272 | 1,549 | |||||||
Total stockholders’ equity | 216,544 | 209,992 | |||||||
Total liabilities and stockholders’ equity | $ | 259,454 | $ | 267,221 | |||||
| Nanometrics Incorporated 1550 Buckeye Drive Milpitas, CA 95035 | Tel: 408.545.6000 Fax: 408.232.5910 www.nanometrics.com |
NANOMETRICS INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended | Twelve Months Ended | ||||||||||||||||
Dec 29, | Dec 31, | Dec 29, | Dec 31, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||||
Net revenues: | |||||||||||||||||
Products | $ | 22,099 | $ | 36,725 | $ | 143,827 | $ | 194,774 | |||||||||
Service | 8,171 | 8,552 | 39,054 | 35,287 | |||||||||||||
Total net revenues | 30,270 | 45,277 | 182,881 | 230,061 | |||||||||||||
Costs of net revenues: | |||||||||||||||||
Cost of products | 12,654 | 19,717 | 75,878 | 88,579 | |||||||||||||
Cost of service | 5,019 | 4,440 | 20,526 | 18,304 | |||||||||||||
Amortization of intangible assets | 646 | 410 | 2,549 | 1,077 | |||||||||||||
Total costs of net revenues | 18,319 | 24,567 | 98,953 | 107,960 | |||||||||||||
Gross profit | 11,951 | 20,710 | 83,928 | 122,101 | |||||||||||||
Operating expenses: | |||||||||||||||||
Research and development | 7,289 | 5,978 | 29,585 | 23,290 | |||||||||||||
Selling | 5,897 | 6,461 | 26,457 | 27,019 | |||||||||||||
General and administrative | 5,107 | 6,143 | 21,632 | 22,901 | |||||||||||||
Amortization of intangible assets | 196 | 156 | 776 | 625 | |||||||||||||
Legal settlement | — | 2,500 | — | 2,500 | |||||||||||||
Total operating expenses | 18,489 | 21,238 | 78,450 | 76,335 | |||||||||||||
Income (loss) from operations | (6,538 | ) | (528 | ) | 5,478 | 45,766 | |||||||||||
Other income (expense): | |||||||||||||||||
Interest income | 20 | 49 | 133 | 220 | |||||||||||||
Interest expense | (245 | ) | (326 | ) | (1,040 | ) | (1,336 | ) | |||||||||
Other, net | 393 | 83 | 48 | (66 | ) | ||||||||||||
Total other income (expense), net | 168 | (194 | ) | (859 | ) | (1,182 | ) | ||||||||||
Income (loss) before income taxes | (6,370 | ) | (722 | ) | 4,619 | 44,584 | |||||||||||
Provision (benefit) for income taxes | (2,723 | ) | (190 | ) | 154 | 15,899 | |||||||||||
Net income (loss) | $ | (3,647 | ) | $ | (532 | ) | $ | 4,465 | $ | 28,685 | |||||||
Net income (loss) per share: | |||||||||||||||||
Basic | $ | (0.16 | ) | $ | (0.02 | ) | $ | 0.19 | $ | 1.26 | |||||||
Diluted | $ | (0.16 | ) | $ | (0.02 | ) | $ | 0.19 | $ | 1.22 | |||||||
Shares used in per share calculation: | |||||||||||||||||
Basic | 23,408 | 23,074 | 23,358 | 22,743 | |||||||||||||
Diluted | 23,408 | 23,074 | 23,845 | 23,480 | |||||||||||||
| Nanometrics Incorporated 1550 Buckeye Drive Milpitas, CA 95035 | Tel: 408.545.6000 Fax: 408.232.5910 www.nanometrics.com |
NANOMETRICS INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Twelve-month Period Ended | |||||||
Dec 29, 2012 | Dec 31, 2011 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 4,465 | $ | 28,685 | |||
Reconciliation of net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 9,811 | 6,488 | |||||
Stock-based compensation | 5,890 | 4,473 | |||||
Excess tax benefit from equity awards | (910 | ) | (3,915 | ) | |||
Loss on disposal of fixed assets | 303 | 113 | |||||
Inventory write down | 1,845 | 1,916 | |||||
Deferred taxes | 2,752 | 3,770 | |||||
Change in the fair value of contingent payments to Zygo Corporation | 327 | 413 | |||||
Changes in assets and liabilities: | |||||||
Accounts receivable | 7,733 | 16,172 | |||||
Inventories | 1,383 | (12,169 | ) | ||||
Inventories-delivered systems | (758 | ) | 446 | ||||
Prepaid expenses and other | 1,114 | (4,747 | ) | ||||
Accounts payable, accrued and other liabilities | (13,538 | ) | 4,241 | ||||
Deferred revenue | 2,472 | 3,088 | |||||
Income taxes payable | 346 | 5,054 | |||||
Net cash provided by operations | 23,235 | 54,028 | |||||
Cash flows from investing activities: | |||||||
Purchase of Nanda's net assets, net of cash received | — | (23,912 | ) | ||||
Escrow payment received related to acquisition of Nanda | 508 | — | |||||
Sales of marketable securities | 3,000 | — | |||||
Maturities of marketable securities | 8,336 | — | |||||
Purchases of marketable securities | (58,647 | ) | — | ||||
Purchase of property, plant and equipment | (4,990 | ) | (2,755 | ) | |||
Net cash used in investing activities | (51,793 | ) | (26,667 | ) | |||
Cash flows from financing activities: | |||||||
Payments to Zygo Corporation related to acquisition | (300 | ) | (432 | ) | |||
Repayments of debt obligations | (2,211 | ) | (2,571 | ) | |||
Proceeds from sale of shares under the employee stock option and purchase plans | 4,686 | 7,186 | |||||
Excess tax benefit from equity awards | 910 | 3,915 | |||||
Taxes paid on net issuance of stock awards | (617 | ) | (126 | ) | |||
Repurchase of common stock | (8,504 | ) | (4,257 | ) | |||
Net cash provided by (used in) financing activities | (6,036 | ) | 3,715 | ||||
Effect of exchange rate changes on cash and cash equivalents | (190 | ) | 163 | ||||
Net increase (decrease) in cash and cash equivalents | (34,784 | ) | 31,239 | ||||
Cash and cash equivalents, beginning of period | 97,699 | 66,460 | |||||
Cash and cash equivalents, end of period | $ | 62,915 | $ | 97,699 | |||
| Nanometrics Incorporated 1550 Buckeye Drive Milpitas, CA 95035 | Tel: 408.545.6000 Fax: 408.232.5910 www.nanometrics.com |
NANOMETRICS INCORPORATED
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended | Twelve Months Ended | ||||||||||||||||||||
Dec 29, | Sep 29, | Dec 31, | Dec 29, | Dec 31, | |||||||||||||||||
2012 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||
Reconciliation of GAAP gross profit to non-GAAP gross profit | |||||||||||||||||||||
GAAP gross profit | $ | 11,951 | $ | 22,152 | $ | 20,710 | $ | 83,928 | $ | 122,101 | |||||||||||
Non-GAAP adjustments: | |||||||||||||||||||||
Amortization of intangible assets | 646 | 629 | 410 | 2,549 | 1,077 | ||||||||||||||||
Non-GAAP gross profit | $ | 12,597 | $ | 22,781 | $ | 21,120 | $ | 86,477 | $ | 123,178 | |||||||||||
Reconciliation of GAAP operating income (loss) to non-GAAP operating income (loss) | |||||||||||||||||||||
GAAP operating income (loss) | $ | (6,538 | ) | $ | 3,614 | $ | (528 | ) | $ | 5,478 | $ | 45,766 | |||||||||
Non-GAAP adjustments: | |||||||||||||||||||||
Amortization of intangible assets included in cost of revenues | 646 | 629 | 410 | 2,549 | 1,077 | ||||||||||||||||
Amortization of intangible assets included in operating expenses | 196 | 193 | 156 | 776 | 625 | ||||||||||||||||
Acquisition-related charges | — | — | 1,277 | — | 1,959 | ||||||||||||||||
Legal settlement | — | — | 2,500 | — | 2,500 | ||||||||||||||||
Total non-GAAP adjustments to operating income | 842 | 822 | 4,343 | 3,325 | 6,161 | ||||||||||||||||
Non-GAAP operating income (loss) | $ | (5,696 | ) | $ | 4,436 | $ | 3,815 | $ | 8,803 | $ | 51,927 | ||||||||||
Reconciliation of GAAP net income (loss) to non-GAAP net income (loss) | |||||||||||||||||||||
GAAP net income (loss) | $ | (3,647 | ) | $ | 1,903 | $ | (532 | ) | $ | 4,465 | $ | 28,685 | |||||||||
Non-GAAP adjustments: | |||||||||||||||||||||
Total non-GAAP adjustments to non-GAAP operating income | 842 | 822 | 4,343 | 3,325 | 6,161 | ||||||||||||||||
Income tax effect of non-GAAP adjustments | (307 | ) | (300 | ) | (1,496 | ) | (1,214 | ) | (2,151 | ) | |||||||||||
Discrete tax adjustment | — | — | — | (1,300 | ) | (a) | — | ||||||||||||||
Non-GAAP net income (loss) | $ | (3,112 | ) | $ | 2,425 | $ | 2,315 | $ | 5,276 | $ | 32,695 | ||||||||||
GAAP net income (loss) per diluted share | $ | (0.16 | ) | $ | 0.08 | $ | (0.02 | ) | $ | 0.19 | $ | 1.22 | |||||||||
Non-GAAP net income (loss) per diluted share | $ | (0.13 | ) | $ | 0.10 | $ | 0.10 | $ | 0.22 | $ | 1.39 | ||||||||||
Shares used in diluted income per share calculation | 23,408 | 23,760 | 23,687 | 23,845 | 23,480 | ||||||||||||||||
(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. The discrete tax adjustment for the second quarter also excludes the one-time benefit associated with the recognition of deferred tax assets related to the entity classification elections, resulting in a combined first and second quarter Non-GAAP tax rate of approximately 36.5%.