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Published: 2022-05-09 16:15:57 ET

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EX-99.1 2 veco-20220509xex99d1.htm EX-99.1

EXHIBIT 99.1

VEECO REPORTS FIRST QUARTER 2022 FINANCIAL RESULTS

First Quarter 2022 Highlights:

●

Revenues of $156.4 million, compared with $133.7 million in the same period last year

●

GAAP net income of $13.3 million, or $0.24 per diluted share, compared with $2.5 million, or $0.05 per diluted share in the same period last year

●

Non-GAAP net income of $21.7 million, or $0.38 per diluted share, compared with $12.6 million, or $0.25 per diluted share in the same period last year

Plainview, N.Y., May 9, 2022 -- Veeco Instruments Inc. (Nasdaq: VECO) today announced financial results for its first quarter ended March 31, 2022. Results are reported in accordance with U.S. generally accepted accounting principles (“GAAP”) and are also reported adjusting for certain items (“Non-GAAP”). A reconciliation between GAAP and Non-GAAP operating results is provided at the end of this press release.

U.S. Dollars in millions, except per share data


	1st Quarter
GAAP Results	Q1 '22		Q1 '21
Revenue	$	156.4	$	133.7
Net income	$	13.3	$	2.5
Diluted earnings per share	$	0.24	$	0.05


	1st Quarter
Non-GAAP Results	Q1 '22		Q1 '21
Operating income	$	24.7	$	16.1
Net income	$	21.7	$	12.6
Diluted earnings per share	$	0.38	$	0.25

“Veeco is experiencing healthy demand for our products and we delivered solid first quarter results above the midpoint of our guidance, with revenue growing 17% from the first quarter last year,” commented Bill Miller, Veeco’s Chief Executive Officer. “Consistent with our growth strategy, sales in both our Semiconductor and Compound Semiconductor markets increased 50% over the same time period.”

“While facing industry-wide cost increases and supply chain disruptions related to inbound material lead times, logistics and labor, the Veeco United team is working diligently to meet our customers’ increasing demands. Looking at the full year, we are on pace to deliver on our 2022 revenue target.”

Guidance and Outlook

The following guidance is provided for Veeco’s second quarter 2022:

●

Revenue is expected in the range of $150 million to $170 million

●

GAAP diluted earnings per share are expected in the range of $0.05 to $0.19

●

Non-GAAP diluted earnings per share are expected in the range of $0.22 to $0.34

Conference Call Information

A conference call reviewing these results has been scheduled for today, May 9, 2022 starting at 5:00pm ET. To join the call, dial 1-888-220-8451 (toll free) or 1-646-828-8193 and use passcode 9557580. Participants may also access a live webcast of the call by visiting the investor relations section of Veeco's website at ir.veeco.com. A replay of the webcast will be made available on the Veeco website that evening. We will post an accompanying slide presentation to our website prior to the beginning of the call.

About Veeco

Veeco (NASDAQ: VECO) is an innovative manufacturer of semiconductor process equipment. Our proven ion beam, laser annealing, lithography, MOCVD, and single wafer etch & clean technologies play an integral role in the fabrication and packaging of advanced semiconductor devices. With equipment designed to optimize performance, yield and cost of ownership, Veeco holds leading technology positions in the markets we serve. To learn more about Veeco’s systems and service offerings, visit www.veeco.com.

Forward-looking Statements

This press release contains “forward-looking statements”, within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, as amended, that are based on management’s expectations, estimates, projections and assumptions. Words such as “expects,” “anticipates,” “plans,” “believes,” “scheduled,” “estimates” and variations of these words and similar expressions are intended to identify forward-looking statements. Forward-looking statements include, but are not limited to, those regarding anticipated growth and trends in our businesses and markets, industry outlooks and demand drivers, our investment and growth strategies, our development of new products and technologies, our business outlook for current and future periods, the impact of the COVID-19 pandemic, our ongoing transformation initiative and the effects thereof on our operations and financial results; and other statements that are not historical facts. These statements and their underlying assumptions are subject to risks and uncertainties and are not guarantees of future performance. Factors that could cause actual results to differ materially from those expressed or implied by such statements include, without limitation: the level of demand for our products; global economic and industry conditions; the effects of regional or global health epidemics, including the effects of the COVID-19 pandemic on the Company’s operations and on those of our customers and suppliers; global trade issues, including the ongoing trade disputes between the U.S. and China, and changes in trade and export license policies; our dependency on third-party suppliers and outsourcing partners; the timing of customer orders; our ability to develop, deliver and support new products and technologies; our ability to expand our current markets, increase market share and develop new markets; the concentrated nature of our customer base; our ability to obtain and protect intellectual property rights in key technologies; our ability to achieve the objectives of operational and strategic initiatives and attract, motivate and retain key employees; the variability of results among products and end-markets, and our ability to accurately forecast future results, market conditions, and customer requirements; the impact of our indebtedness, including our convertible senior notes and our capped call transactions; and other risks and uncertainties described in our SEC filings on Forms 10-K, 10-Q and 8-K, and from time-to-time in our other SEC reports. All forward-looking statements speak only to management’s expectations, estimates, projections and assumptions as of the date of this press release or, in the case of any document referenced herein or incorporated by reference, the date of that document. The Company does not undertake any obligation to update or publicly revise any forward-looking statements to reflect events, circumstances or changes in expectations after the date of this press release.

-financial tables attached-

Veeco Contacts:

Investors:Anthony Bencivenga (516) 252-1438abencivenga@veeco.com

Media:Kevin Long (516) 714-3978klong@veeco.com

Veeco Instruments Inc. and Subsidiaries
Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)
(unaudited)


	Three months ended March 31,
	2022		2021
Net sales	$	156,426	$	133,714
Cost of sales		90,413		78,800
Gross profit		66,013		54,914
Operating expenses, net:
Research and development		24,117		21,844
Selling, general, and administrative		22,894		20,255
Amortization of intangible assets		2,504		3,354
Other operating expense (income), net		(19)		46
Total operating expenses, net		49,496		45,499
Operating income		16,517		9,415
Interest expense, net		(2,803)		(6,623)
Income before income taxes		13,714		2,792
Income tax expense (benefit)		384		298
Net income	$	13,330	$	2,494

Income per common share:
Basic	$	0.27	$	0.05
Diluted	$	0.24	$	0.05

Weighted average number of shares:
Basic		49,614		48,624
Diluted		65,285		53,050

Veeco Instruments Inc. and Subsidiaries
Condensed Consolidated Balance Sheets

(in thousands)


	March 31,		December 31,
	2022		2021
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	127,624	$	119,747
Restricted cash		688		725
Short-term investments		103,277		104,181
Accounts receivable, net		99,479		109,609
Contract assets		25,602		18,293
Inventories		179,066		170,858
Prepaid expenses and other current assets		34,214		25,974
Total current assets		569,950		549,387
Property, plant and equipment, net		104,128		99,743
Operating lease right-of-use assets		27,800		28,813
Intangible assets, net		31,401		33,905
Goodwill		181,943		181,943
Deferred income taxes		1,639		1,639
Other assets		3,503		3,546
Total assets	$	920,364	$	898,976

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	56,154	$	44,456
Accrued expenses and other current liabilities		80,920		79,752
Customer deposits and deferred revenue		61,893		63,136
Income taxes payable		1,633		1,860
Current portion of long-term debt		20,096		—
Total current liabilities		220,696		189,204
Deferred income taxes		4,780		4,792
Long-term debt		253,840		229,438
Long-term operating lease liabilities		32,410		32,834
Other liabilities		5,068		5,080
Total liabilities		516,794		461,348

Total stockholders’ equity		403,570		437,628
Total liabilities and stockholders’ equity	$	920,364	$	898,976

Note on Reconciliation Tables

The below tables include financial measures adjusted for the impact of certain items; these financial measures are therefore not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These Non-GAAP financial measures exclude items such as: share-based compensation expense; charges relating to restructuring initiatives; non-cash asset impairments; certain other non-operating gains and losses; and acquisition-related items such as transaction costs, non-cash amortization of acquired intangible assets, and certain integration costs.

These Non-GAAP financial measures may be different from Non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. By excluding these items, Non-GAAP financial measures are intended to facilitate meaningful comparisons to historical operating results, competitors’ operating results, and estimates made by securities analysts. Management is evaluated on key performance metrics including Non-GAAP Operating income (loss), which is used to determine management incentive compensation as well as to forecast future periods. These Non-GAAP financial measures may be useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. In addition, similar Non-GAAP financial measures have historically been reported to investors; the inclusion of comparable numbers provides consistency in financial reporting. Investors are encouraged to review the reconciliation of the Non-GAAP financial measures used in this news release to their most directly comparable GAAP financial measures.

Reconciliation of GAAP to Non-GAAP Financial Data (Q1 2022)

(in thousands)
(unaudited)


				Non-GAAP Adjustments
				Share-Based
Three months ended March 31, 2022	GAAP			Compensation	Amortization	Other		Non-GAAP
Net sales	$	156,426						$	156,426
Gross profit		66,013		938		534			67,485
Gross margin		42.2	%						43.1	%
Operating expenses		49,496		(3,543)	(2,504)	(691)			42,758
Operating income		16,517		4,481	2,504	1,225	^		24,727
Net income		13,330		4,481	2,504	1,387	^		21,702

^	- See table below for additional details.

Other Non-GAAP Adjustments (Q1 2022)

(in thousands)
(unaudited)


Three months ended March 31, 2022
Transition expenses related to San Jose expansion project	$	1,165
Depreciation of PP&E fair value step-up associated with the Ultratech purchase accounting		60
Subtotal		1,225
Non-cash interest expense		237
Non-GAAP tax adjustment *		(75)
Total Other	$	1,387

*	- The ‘with or without’ method is utilized to determine the income tax effect of all Non-GAAP adjustments.

Net Income per Common Share (Q1 2022)

(in thousands, except per share amounts)
(unaudited)


	Three months ended March 31, 2022
	GAAP		Non-GAAP
Numerator:
Net income	$	13,330	$	21,702
Interest expense associated with convertible notes		2,544		2,467
Net income available to common shareholders	$	15,874	$	24,169

Denominator:
Basic weighted average shares outstanding		49,614		49,614
Effect of potentially dilutive share-based awards		1,208		1,208
Dilutive effect of 2023 Convertible Senior Notes		—		504
Dilutive effect of 2025 Convertible Senior Notes		5,521		5,521
Dilutive effect of 2027 Convertible Senior Notes ⁽¹⁾		8,942		6,771
Diluted weighted average shares outstanding		65,285		63,618

Net income per common share:
Basic	$	0.27	$	0.44
Diluted	$	0.24	$	0.38

⁽¹⁾ - The non-GAAP incremental dilutive shares includes the impact of the Company’s capped call transaction issued concurrently with our 2027 Notes, and as such, an effective conversion price of $18.46 is used when determining incremental shares to add to the dilutive share count. The GAAP incremental dilutive shares does not include the impact of the Company’s capped call transaction, and as such, an effective conversion price of $13.98 is used when determining incremental shares to add to the dilutive share count.

Reconciliation of GAAP to Non-GAAP Financial Data (Q1 2021)

(in thousands, except per share amounts)
(unaudited)


				Non-GAAP Adjustments
				Share-based
Three months ended March 31, 2021		GAAP		Compensation	Amortization	Other		Non-GAAP
Net sales	$	133,714						$	133,714
Gross profit		54,914		495		32			55,441
Gross margin		41.1	%						41.5	%
Operating expenses		45,499		(2,742)	(3,354)	(73)			39,330
Operating income		9,415		3,237	3,354	105	^		16,111
Net income		2,494		3,237	3,354	3,544	^		12,629

Income per common share:
Basic	$	0.05						$	0.26
Diluted		0.05							0.25
Weighted average number of shares:
Basic		48,624							48,624
Diluted ⁽¹⁾		53,050							50,880

^	- See table below for additional details.

⁽¹⁾ - The non-GAAP incremental dilutive shares includes the impact of the Company’s capped call transaction issued concurrently with our 2027 Notes, and as such, no incremental shares are added to the dilutive share count in periods in which the average stock price per share is below $18.46. The GAAP incremental dilutive shares does not include the impact of the Company’s capped call transaction, and as such, incremental shares are added to the dilutive share count in periods in which the average stock price per share is above $13.98, and the Company is in a net income position. The average stock price for the three months ended March 31, 2021 was $20.80, and therefore 0.8 million shares were included in the non-GAAP diluted share count, and 2.9 million shares were included in the GAAP diluted share count related to the 2027 Notes.

Other Non-GAAP Adjustments (Q1 2021)

(in thousands)
(unaudited)


Three months ended March 31, 2021
Depreciation of PP&E fair value step-up associated with the Ultratech purchase accounting	$	96
Other		9
Subtotal		105
Non-cash interest expense		3,514
Non-GAAP tax adjustment *		(75)
Total Other	$	3,544

*	- The ‘with or without’ method is utilized to determine the income tax effect of all Non-GAAP adjustments.

Reconciliation of GAAP Net Income to Non-GAAP Operating Income (Q1 2022 and 2021)

(in thousands)
(unaudited)


	Three months ended		Three months ended
	March 31, 2022		March 31, 2021
GAAP Net income	$	13,330	$	2,494
Share-based compensation		4,481		3,237
Amortization		2,504		3,354
Transition expenses related to San Jose expansion project		1,165		—
Depreciation of PP&E fair value step-up associated with the Ultratech purchase accounting		60		96
Interest (income) expense, net		2,803		6,623
Income tax expense (benefit)		384		298
Other		—		9
Non-GAAP Operating income	$	24,727	$	16,111

Reconciliation of GAAP to Non-GAAP Financial Data (Q2 2022)

(in millions, except per share amounts)

(unaudited)


						Non-GAAP Adjustments
Guidance for the three months ending						Share-based
June 30, 2022	GAAP					Compensation	Amortization	Other	Non-GAAP
Net sales	$	150	-	$	170				$	150	-	$	170
Gross profit		58	-		67	1	—	1		60	-		69
Gross margin		38%	-		39%					40%	-		41%
Operating expenses		51	-		53	(4)	(3)	(1)		44	-		46
Operating income		6	-		13	5	3	1		15	-		22
Net income	$	3	-	$	10	5	3	1	$	12	-	$	19

Income per diluted common share	$	0.05	-	$	0.19				$	0.22	-	$	0.34

Income per Diluted Common Share (Q2 2022)

(in millions, except per share amounts)
(unaudited)


Guidance for the three months ending June 30, 2022	GAAP					Non-GAAP
Numerator:
Net income	$	3	-	$	10	$	12	-	$	19
Interest expense associated with convertible notes		—			1		2			2
Net income available to common shareholders	$	3	-	$	11	$	14	-	$	21

Denominator:
Basic weighted average shares outstanding		49			49		49			49
Effect of potentially dilutive share-based awards		2			2		2			2
Dilutive effect of 2023 Convertible Senior Notes		—			—		—			—
Dilutive effect of 2025 Convertible Senior Notes		—			—		6			6
Dilutive effect of 2027 Convertible Senior Notes ⁽¹⁾		—			9		7			7
Diluted weighted average shares outstanding		51			60		64			64

Net income per common share:
Income per diluted common share	$	0.05	-	$	0.19	$	0.22	-	$	0.34

Reconciliation of GAAP Net Income to Non-GAAP Operating Income (Q2 2022)

(in millions)
(unaudited)


Guidance for the three months ending June 30, 2022
GAAP Net income	$	3	-	$	10
Share-based compensation		5	-		5
Amortization		3	-		3
Interest expense, net		3	-		3
Other		1	-		1
Non-GAAP Operating income	$	15	-	$	22

Note: Amounts may not calculate precisely due to rounding.