PR Newswire | May 6, 2021 08:03AM EDT

05/06 07:00 CDT

Nova Reports Record First Quarter 2021 Results REHOVOT, Israel, May 6, 2021

REHOVOT, Israel, May 6, 2021 /PRNewswire/ -- Nova(Nasdaq: NVMI) today announced financial results for the first quarter ended March 31, 2021.

First Quarter 2021 Highlights:

* Record quarterly revenue of $84.1 million, up 38% year over year * Record GAAP net income of $17.6 million, or $0.60 per diluted share, up 46% year over year on a per-share basis * Record Non-GAAP net income of $20.5 million, or $0.70 per diluted share, up 37% year over year on a per-share basis * Record service revenue, led by installed base functionality expansions and productivity upgrades * Record product bookings driven by continued diversification across geographies, fabrication technologies and customers

GAAP Results ($K)

Q1 2021Q4 2020Q1 2020

Revenues $84,133$76,303$61,022

Net Income $17,616$13,657$11,682

Earnings per Diluted Share$0.60 $0.47 $0.41

NON-GAAP Results ($K)

Q1 2021Q4 2020Q1 2020

Net Income $20,485$15,872$13,481

Earnings per Diluted Share$0.70 $0.55 $0.47

A reconciliation between GAAP operating results and non-GAAP operating resultsis provided following the financial statements that are part of this release.Non-GAAP results exclude amortization of acquired intangible assets,stock-based compensation expenses, expense related to a transaction made by afinancial institution without Company authorization, facilities transitioncosts, revaluation of operating lease liabilities, amortization of debtdiscount and issuance costs and tax effect of non-GAAP adjustment.

Management Comments

"Nova delivered a strong growth quarter, outperforming our guidance and achieving revenue and profit records. Our remarkable results were driven by the proliferation of our advanced solutions across customers, segments and technology nodes," commented Eitan Oppenhaim, President and Chief Executive Officer. "Our differentiated portfolio, honed by our commitment to innovation, continues to strengthen our market position as we address increasingly complex technical transitions to new generations of semiconductors. The achievements this quarter mark another successful milestone in our growth trajectory for this year, as we expand our market presence and deploy our new leading-edge technologies."

2021 Second Quarter Financial Outlook

Management provided an outlook for the second quarter, the period ending June 30, 2021. Based on current estimates, management expects:

* $84 million to $92 million in revenue * $0.51 to $0.64 in diluted GAAP EPS * $0.64 to $0.77 in diluted non-GAAP EPS

2021 First Quarter Results

Total revenues for the first quarter of 2021 were $84.1 million, an increase of 10%, compared with the fourth quarter of 2020 and an increase of 38% compared with the first quarter of 2020.

Gross margin for the first quarter of 2021 was 57%, compared with a gross margin of 55% in the fourth quarter of 2020, and compared with a gross margin of 56% in the first quarter of 2020.

Operating expenses in the first quarter of 2021 were $28.2 million, compared with $25.5 million in the fourth quarter of 2020 and compared with $21.5 million in the first quarter of 2020.

On a GAAP basis, the Company reported net income of $17.6 million, or $0.60 per diluted share, in the first quarter of 2021. This is compared with net income of $13.7 million, or $0.47 per diluted share, in the fourth quarter of 2020, and compared with net income of $11.7 million, or $0.41 per diluted share, in the first quarter of 2020.

On a non-GAAP basis, which excludes amortization of acquired intangible assets, stock-based compensation expenses, a one-time expense related to a transaction made by a financial institution without Company authorization, facilities transition costs, revaluation of operating lease liabilities, amortization of debt discount and issuance costs and tax effect of non-GAAP adjustment, the Company reported net income of $20.5million, or $0.70 per diluted share, in the first quarter of 2021. This is compared with net income of $15.9 million, or $0.55 per diluted share, in the fourth quarter of 2020, and compared with net income of $13.5 million, or $0.47 per diluted share, in the first quarter of 2020.

Conference Call Information

Nova will host a conference call today, May 6, 2021, at 9 a.m. Eastern Time, to discuss the financial results and outlook. To attend the conference call, please dial one of the following teleconferencing numbers. Please begin by placing your calls five minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.

U.S. TOLL-FREE Dial-in Number: 1-800-289-0438 ISRAEL TOLL-FREE Dial-in Number: 1-809-212-883INTERNATIONAL Dial-in Number: 1-323-794-2423

At:9 a.m. Eastern Time6 a.m. Pacific Time4 p.m. Israel Time

Please reference conference ID: 3276680

The conference call will also be webcast live from a link on Nova's website at https://www.novami.com/investors/events/.

A replay of the conference call will be available from May 6, 2021 at 12 p.m. Eastern Time to May 13, 2021 at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:

Replay Dial-in TOLL-FREE: 1-844-512-2921 Replay Dial-in TOLL/INTERNATIONAL: 1-412-317-6671Replay Pin Number: 3276680

A replay will also be available for 90 days on Nova's website at https://www.novami.com/investors/events/.

About Nova:Nova is a leading innovator and key provider of metrology solutions for advanced process control used in semiconductor manufacturing. Nova delivers continuous innovation by providing state-of-the-art high-performance metrology solutions for effective process control throughout the semiconductor fabrication lifecycle. Nova's product portfolio, which combines high-precision hardware and cutting-edge software, provides its customers with deep insight into the development and production of the most advanced semiconductor devices. Nova's unique capability to deliver innovative x-ray and optical solutions enables its customers to improve performance, enhance product yields and accelerate time to market. Nova acts as a partner to semiconductor manufacturers from its offices around the world. Additional information may be found at www.novami.com.

Nova is traded on the NASDAQ & TASE under the symbol NVMI.

This press release provides financial measures that exclude amortization of acquired intangible assets, stock-based compensation expenses, expense related to a transaction made by a financial institution without Company authorization, facilities transition costs, revaluation of operating lease liabilities, amortization of debt discount and issuance costs and tax effect of non-GAAP adjustment, as applicable, 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 enhance management's and investors' ability to evaluate Nova's performance before charges or benefits 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 allow 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.

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, but are not limited to, anticipated growth opportunities and projections about our business and its future revenues, expenses 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. Factors that may affect our results, performance, circumstances or achievements include, but are not limited to, the following: catastrophic events such as the outbreak of COVID-19; increased information technology security threats and sophisticated computer crime; foreign political and economic risks; changes in U.S. trade policies; inability to protect intellectual property; open source technology exposure; failure to compete effectively or to respond to the rapid technological changes; consolidation in our industry; difficulty to predict the length and strength of any downturn or expansion period of the market we target; factors that adversely affect the pricing and demand for our product lines; dependency on a small number of large customers; dependency on a single manufacturing facility per product line; dependency on a limited number of suppliers; lengthy sales cycle and customer delays in orders; political, economic, and military instability in Israel; risks related to our convertible notes; currency fluctuations; and quarterly fluctuations in our operating results. 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, 2020 filed with the Securities and Exchange Commission on March 1, 2021. 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.

(Tables to Follow)

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands) - (Unaudited)

As of

March 31, December 31,ASSETS 2021 2020

Current assets

Cash and cash equivalents 208,758 232,304

Short-term interest-bearing bank deposits 246,096 191,567

Trade accounts receivable, net 59,820 63,314

Inventories 66,141 61,734

Other current assets 10,435 9,782

Total current assets 591,250 558,701

Non-current assets

Interest-bearing bank deposits 3,425 2,547

Restricted interest-bearing bank deposits 1,750 1,476

Deferred tax assets 3,467 2,869

Other long-term assets 443 462

Severance pay funds 1,251 1,281

Operating lease right-of-use assets 29,055 29,109

Property and equipment, net 33,138 34,168

Intangible assets, net 4,484 5,059

Goodwill 20,114 20,114

Total non-current assets 97,127 97,085

Total assets 688,377 655,786

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities

Trade accounts payable 24,586 24,096

Deferred revenues 13,738 4,717

Operating lease current liabilities 3,867 3,703

Other current liabilities 31,741 28,418

Total current liabilities 73,932 60,934

Non-current liabilities

Convertible senior notes, net 179,842 178,808

Accrued severance pay 3,651 3,719

Operating lease long-term liabilities 30,827 31,905

Other long-term liability 9,378 8,882

Total non-current liabilities 223,698 223,314

Shareholders' equity 390,747 371,538

Total liabilities and shareholders' equity 688,377 655,786

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except per share data) - (Unaudited)

Three months ended

March 31,

2021 2020

Revenues:

Products 66,283 45,725

Services 17,850 15,297

Total revenues 84,133 61,022

Cost of revenues:

Products 25,232 18,040

Services 10,971 8,640

Total cost of revenues 36,203 26,680

Gross profit 47,930 34,342

Operating expenses:

Research and development, net 14,518 11,683

Sales and marketing 9,540 6,563

General and administrative 3,539 2,589

Amortization of acquired intangible assets 575 626

Total operating expenses 28,172 21,461

Operating income 19,758 12,881

Financing income, net 424 1,028

Income before tax on income 20,182 13,909

Income tax expenses 2,566 2,227

Net income for the period 17,616 11,682

Earnings per share:

Basic 0.62 0.42

Diluted 0.60 0.41

Shares used for calculation of earnings per share

(in thousands):

Basic 28,214 27,902

Diluted 29,306 28,760

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands) - (Unaudited)

Three months ended

March 31,

2021 2020

Cash flows from operating activities:

Net income $ 17,616 $ 11,682

Adjustments to reconcile net income to net cash provided by operatingactivities:

Depreciation of property and equipment 1,579 1,410

Amortization of intangible assets 575 626

Amortization of debt discount and issuance costs 1,034 -

Share-based compensation 2,222 1,318

Net effect of exchange rate fluctuation 362 399

Changes in assets and liabilities:

Trade accounts receivables, net 3,494 (3,440)

Inventories (4,417) (1,448)

Other current and long-term assets (1,162) 3,693

Deferred tax assets, net (598) (201)

Operating lease right-of-use assets 406 254

Trade accounts payables 439 (2,255)

Deferred revenues 9,021 346

Operating lease liabilities (1,266) (923)

Other current and long-term liabilities 3,718 2,411

Accrued severance pay, net (38) 18

Net cash provided by operating activities 32,985 13,890

Cash flows from investment activities:

Increase in short-term and long-term interest-bearing bank deposits (55,805) (7,629)

Purchase of property and equipment (488) (2,270)

Net cash used in investing activities (56,293) (9,899)

Cash flows from financing activities:

Purchases of treasury shares - (14)

Proceeds from exercise of options - 111

Net cash provided by financing activities - 97

Effect of exchange rate fluctuations on cash and cash equivalents (238) (305)

Increase (decrease) in cash and cash equivalents (23,546) 3,783

Cash and cash equivalents - beginning of year 232,304 31,748

Cash and cash equivalents - end of year $ 208,758 $ 35,531

NOVA MEASURING INSTRUMENTS LTD.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(U.S. dollars in thousands, except percentage and per share data) - (Unaudited)

Three months ended

March 31, December 31, March 31,

2021 2020 2020

GAAP gross profit 47,930 42,323 34,342

Stock-based compensation expenses * 418 415 256

Non-GAAP gross profit 48,348 42,738 34,598

GAAP gross margin as a percentage of revenues 57% 55% 56%

Non-GAAP gross margin as a percentage of revenues 57% 56% 57%

GAAP operating income 19,758 16,846 12,881

Stock-based compensation expenses * 2,222 2,231 1,318

Amortization of acquired intangible assets 575 626 626

One-time income related to a transaction made by a - (2,850) -financial institution without Company authorization

Non-GAAP operating income 22,555 16,853 14,825

GAAP operating margin as a percentage of revenues 23% 22% 21%

Non-GAAP operating margin as a percentage of 27% 22% 24%revenues

GAAP net income 17,616 13,657 11,682

Stock-based compensation expenses * 2,222 2,231 1,318

Amortization of acquired intangible assets 575 626 626

Amortization of debt discount and issuance costs 1,034 868 -

One-time income related to a transaction made by a - (2,850) -financial institution without Company authorization

Revaluation of operating lease liabilities (860) 1,364 (66)

Tax effect of non-GAAP adjustments (102) (24) (79)

Non-GAAP net income 20,485 15,872 13,481

GAAP basic earnings per share 0.62 0.49 0.42

Non-GAAP basic earnings per share 0.73 0.56 0.48

GAAP diluted earnings per share 0.60 0.47 0.41

Non-GAAP diluted earnings per share 0.70 0.55 0.47

Shares used for calculation of earnings per share

(in thousands):

Basic 28,214 28,146 27,902

Diluted 29,306 28,999 28,760

* Stock-based compensation expenses for the three months ended March 31, 2021 included in - Cost of revenues products - 250; Cost of revenues services - 168; Research and development expenses, net - 843; Sales and marketing expenses - 501; General and administrative expenses - 460

NOVA MEASURING INSTRUMENTS LTD.

SUPPLEMENTAL INFORMATION - RECONCILIATION OF SECOND QUARTER 2021

GAAP TO NON-GAAP GUIDANCE

(Unaudited)

Low High

Estimated GAAP net income per diluted share 0.51 0.64

Estimated non-GAAP items:

Stock-based compensation expenses 0.09 0.09

Amortization of acquired intangible assets 0.02 0.02

Amortization of debt discount and issuance costs 0.03 0.03

Tax effect of non-GAAP adjustments (0.01) (0.01)

Estimated non-GAAP net income per diluted share 0.64 0.77

Company Contact:Dror David, Chief Financial Officer Investor Relations Contact:Nova Measuring Instruments Ltd. Miri Segal MS-IR LLCTel: +972-73-229-5760 Tel: +917-607-8654E-mail: info@novami.com E-mail: msegal@ms-ir.com https://www.novami.com/

Logo - https://mma.prnewswire.com/media/1446151/Nova_Logo.jpg

View original content: http://www.prnewswire.com/news-releases/nova-reports-record-first-quarter-2021-results-301285430.html

SOURCE Nova