REHOVOT, Israel, May 11, 2023
/PRNewswire/ -- Nova (Nasdaq: NVMI) today announced financial
results for the first quarter ended March
31, 2023.
First Quarter 2023 Highlights:
- Quarterly revenue of $132.2
million, down 1% year over year
- GAAP net income of $34.6 million,
or $1.09 per diluted share, up 2%
year over year on a per-share basis, exceeding management guidance
of $0.77 to $0.98
- Non-GAAP net income of $39.1
million, or $1.23 per diluted
share, down 5% year over year on a per-share basis, exceeding
management guidance of $0.93 to
$1.14
- Significant improvement in blended gross margin, driven by
record software revenues and a favorable product mix
- Record bookings for materials metrology, including VERAFLEX,
METRION, and ELIPSON platforms
GAAP Results (K)
|
Q1
2023
|
Q4
2022
|
Q1
2022
|
Revenues
|
$132,193
|
$151,238
|
$133,957
|
Net Income
|
$34,627
|
$36,098
|
$34,162
|
Earnings per Diluted
Share
|
$1.09
|
$1.14
|
$1.07
|
Non-GAAP Results (K)
|
Q1
2023
|
Q4
2022
|
Q1
2022
|
Net Income
|
$39,075
|
$40,778
|
$41,487
|
Earnings per Diluted
Share
|
$1.23
|
$1.28
|
$1.30
|
A
reconciliation between GAAP operating results
and non-GAAP operating results
is provided following the financial statements
included in this release. See also "Use of Non-GAAP Adjusted
Financial Measures" section.
Management Comments
"Nova's performance in the first quarter displays resilience
amidst a challenging industry environment. Our excellent
profitability attests to the exceptional value our portfolio offers
to customers and to the agility of our operational model," said
Gaby Waisman, President and CEO.
"We're encouraged by the record bookings for our materials
metrology solutions and believe our positioning in this strategic
domain is a growth engine for years to come. As our industry charts
a path forward, navigating a host of global volatile conditions, we
at Nova remain focused on our strategic plans and infrastructure
investments that will enable our long-term growth."
2023 Second Quarter Financial Outlook
Management provided an outlook for the second quarter, the
period ending June 30, 2023. Based on
current estimates, management expects:
- $117 million to $125 million in revenue
- $0.75 to $0.89 in diluted GAAP EPS
- $0.92 to $1.06 in diluted non-GAAP EPS
2023 First Quarter Results
Total revenues for the first quarter of
2023 were $132.2 million, a decrease
of 13% compared with the fourth quarter of 2022
and a decrease of 1% compared with the first quarter of 2022.
Gross margin in the first quarter of 2023 was 58%,
compared with 55% in the fourth quarter of 2022 and
56% in the first quarter of 2022.
Operating expenses in the first quarter of 2023 were
$41.5 million, compared with
$45.5 million in the fourth quarter
of 2022 and $37.6 million in the
first quarter of 2022.
On a GAAP basis, the Company reported net income of $34.6 million, or $1.09 per diluted share, in the first quarter of
2023. This is compared with net income of $36.1 million, or $1.14 per diluted share, in the fourth quarter of
2022, and net income of $34.2
million, or $1.07 per diluted
share, in the first quarter of 2022.
On a non-GAAP basis, the Company reported net income of
$39.1 million, or $1.23 per diluted share, in the first
quarter of
2023. This is compared with net income
of $40.8 million, or $1.28 per diluted share, in the
fourth quarter of 2022, and net income of $41.5 million, or $1.30 per diluted share, in the first quarter of
2022.
Conference Call Information
Nova will host a conference call today, May 11, 2023, at 8:30 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: 1-844-826-3035
ISRAEL TOLL-FREE Dial-in
Number: 1-80-921-3284
INTERNATIONAL Dial-in Number:
1-412-317-5195
At:
8:30 a.m. Eastern Time
5:30 a.m. Pacific
Time
3:30 p.m. Israel
Time
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 11, 2023, at 11:30 a.m. Eastern Time until May 18, 2023, 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:
1-412-317-6671
Replay Pin Number:
10177465
A replay will also be available for 90 days on Nova's website
link at https://www.novami.com/investors/events/.
About Nova
Nova is a leading innovator and key provider of material,
optical and chemical metrology solutions for advanced process
control 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 developing and
producing the most advanced semiconductor devices. Nova's unique
capability to deliver innovative 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 worldwide. Additional information may be found on
Nova's website link - https://www.novami.com/.
Nova is traded on the Nasdaq and TASE, Nasdaq ticker symbol
NVMI.
Use of Non-GAAP Adjusted Financial Measures
This press release provides financial measures that exclude
amortization of acquired intangible assets, acquisition-related
expenses, inventory step-up and contingent consideration
revaluation, stock-based compensation expenses, 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.
Forward-Looking Statements
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 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 differ
materially 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: increased information technology security threats and
sophisticated computer crime; foreign political and economic risks
including supply-chain difficulties; regulations that could
restrict our operations such as economic sanctions and export
restrictions; changes in U.S. trade policies; indirect effects of
the Russia – Ukraine conflict; market instability including
inflation and recessionary pressures; risks related to doing
business with China; catastrophic
events such as the outbreak of COVID-19; inability to protect our
intellectual property; open source technology exposure; failure to
compete effectively or to respond to rapid technological changes;
consolidation in our industry; difficulty in predicting 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; difficulty in
integrating current or future acquisitions; lengthy sales cycle and
customer delays in orders; political, economic and military
instability in Israel including
related to the potential changes to the judicial system; 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, 2022, filed with the
Securities and Exchange Commission on February 28, 2023. These factors are updated from
time to time through the filing of reports and registration
statements with the Securities and Exchange Commission. Nova Ltd.
does not assume any obligation to update the forward-looking
information contained in this press release.
NOVA LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars
in thousands) - (Unaudited)
|
As of
|
|
March
31,
|
December
31,
|
ASSETS
|
2023
|
2022
|
Current
assets
|
|
|
Cash and cash
equivalents
|
96,075
|
111,121
|
Short-term
interest-bearing bank deposits
|
113,562
|
95,305
|
Marketable
securities
|
179,761
|
167,073
|
Trade accounts
receivable, net
|
100,985
|
109,320
|
Inventories
|
137,096
|
116,600
|
Other current
assets
|
21,639
|
13,527
|
Total current
assets
|
649,118
|
612,946
|
Non-current
assets
|
|
|
Marketable
securities
|
154,825
|
153,462
|
Interest-bearing bank
deposits and restricted cash
|
5,998
|
2,083
|
Deferred tax
assets
|
21,656
|
20,097
|
Operating lease
right-of-use assets
|
43,968
|
44,885
|
Property plant and
equipment, net
|
56,821
|
55,886
|
Intangible assets,
net
|
42,969
|
43,586
|
Goodwill
|
49,585
|
49,009
|
Other long-term
assets
|
1,997
|
2,151
|
Total non-current
assets
|
377,819
|
371,159
|
Total
assets
|
1,026,937
|
984,105
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
Current
liabilities
|
|
|
Trade accounts
payable
|
43,092
|
42,732
|
Deferred
revenues
|
30,238
|
30,543
|
Operating lease
current liabilities
|
5,974
|
5,968
|
Other current
liabilities
|
56,426
|
54,825
|
Total current
liabilities
|
135,730
|
134,068
|
Non-current
liabilities
|
|
|
Convertible senior
notes, net
|
196,710
|
196,394
|
Operating lease
long-term liabilities
|
41,932
|
43,697
|
Long-term deferred tax
liability
|
12,065
|
12,190
|
Other long-term
liabilities
|
11,206
|
10,793
|
Total non-current
liabilities
|
261,913
|
263,074
|
Shareholders'
equity
|
629,294
|
586,963
|
Total liabilities
and shareholders' equity
|
1,026,937
|
984,105
|
NOVA LTD.
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(U.S. dollars in thousands, except per
share data) - (Unaudited)
|
Three months
ended
March 31,
|
|
2023
|
2022
|
Revenues:
|
|
|
Products
|
105,331
|
109,912
|
Services
|
26,862
|
24,045
|
Total
revenues
|
132,193
|
133,957
|
Total cost of
revenues
|
54,927
|
59,282
|
Gross
profit
|
77,266
|
74,675
|
Operating
expenses:
|
|
|
Research and
development, net
|
22,968
|
19,129
|
Sales and
marketing
|
13,522
|
12,384
|
General and
administrative
|
5,039
|
6,056
|
Total operating
expenses
|
41,529
|
37,569
|
Operating
income
|
35,737
|
37,106
|
Financing income,
net
|
4,728
|
1,218
|
Income before taxes
on income
|
40,465
|
38,324
|
Income tax
expenses
|
5,838
|
4,162
|
Net income for the
period
|
34,627
|
34,162
|
|
|
|
Earnings per
share:
|
|
|
Basic
|
1.21
|
1.20
|
Diluted
|
1.09
|
1.07
|
|
|
|
Shares used in
calculation of earnings per share
(in thousands):
|
|
|
Basic
|
28,678
|
28,579
|
Diluted
|
31,824
|
31,968
|
NOVA LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
(U.S. dollars in thousands) -
(Unaudited)
|
Three months
ended
March 31,
|
|
2023
|
2022
|
Cash flows from
operating activities:
|
|
|
Net
income
|
34,627
|
34,162
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
Depreciation of property and
equipment
|
2,340
|
2,035
|
Amortization of intangible
assets
|
1,444
|
1,613
|
Amortization of premium and
accretion of discount on marketable securities, net
|
(428)
|
829
|
Amortization of debt
discount and issuance costs
|
316
|
320
|
Share-based
compensation
|
4,394
|
3,860
|
Net effect of exchange rate
fluctuation
|
1,349
|
793
|
Changes in assets and
liabilities:
|
|
|
Trade accounts receivables,
net
|
8,617
|
470
|
Inventories
|
(20,335)
|
(6,898)
|
Other current and long-term
assets
|
(8,231)
|
(15,996)
|
Deferred tax assets,
net
|
(1,937)
|
(2,609)
|
Operating lease right-of-use
assets
|
802
|
912
|
Trade accounts
payables
|
500
|
(1,941)
|
Deferred revenues
|
(313)
|
(744)
|
Operating lease
liabilities
|
(1,645)
|
(806)
|
Other current and long-term
liabilities
|
1,670
|
(3,151)
|
Accrued severance pay,
net
|
(98)
|
61
|
Net cash provided by
operating activities
|
23,072
|
12,910
|
Cash flows from
investment activities:
|
|
|
Acquisition of
subsidiary, net of acquired cash
|
-
|
(78,469)
|
Change in short-term
and long-term interest-bearing bank deposits
|
(23,062)
|
49,632
|
Investment in
marketable securities
|
(53,682)
|
(16,836)
|
Proceeds from maturity
of marketable securities
|
41,892
|
15,770
|
Purchase of property
and equipment
|
(2,758)
|
(3,718)
|
Net cash used in
investing activities
|
(37,610)
|
(33,621)
|
Cash flows from
financing activities:
|
|
|
Purchases of treasury
shares
|
(112)
|
-
|
Net cash used in
financing activities
|
(112)
|
-
|
Effect of exchange rate
fluctuations on cash and cash equivalents
|
(996)
|
(794)
|
Changes in cash and
cash equivalents and restricted cash
|
(15,646)
|
(21,505)
|
Cash and cash
equivalents and restricted cash - beginning of
period
|
111,721
|
126,698
|
Cash and cash
equivalents - end of period
|
96,075
|
105,193
|
NOVA 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,
2023
|
December
31,
2022
|
March 31,
2022
|
GAAP gross
profit
|
77,266
|
82,421
|
74,675
|
Stock-based
compensation*
|
1,165
|
1,148
|
883
|
Amortization of
acquired intangible assets
|
1,338
|
1,307
|
1,475
|
Acquisition related
inventory step-up
|
-
|
-
|
2,606
|
Non-GAAP gross
profit
|
79,769
|
84,876
|
79,639
|
GAAP gross margin as
a percentage of revenues
|
58 %
|
54 %
|
56 %
|
Non-GAAP gross
margin as a percentage of revenues
|
60 %
|
56 %
|
59 %
|
|
|
|
|
GAAP operating
income
|
35,737
|
36,924
|
37,106
|
Stock-based
compensation*
|
4,394
|
4,381
|
3,860
|
Acquisition-related
inventory step-up
|
-
|
-
|
2,606
|
Acquisition-related
expenses and contingent
consideration
revaluation
|
-
|
(752)
|
1,355
|
Amortization of
acquired intangible assets
|
1,444
|
1,463
|
1,613
|
Non-GAAP operating
income
|
41,575
|
42,016
|
46,540
|
GAAP operating
margin as a percentage of revenues
|
27 %
|
24 %
|
28 %
|
Non-GAAP operating
margin as a percentage of revenues
|
31 %
|
28 %
|
35 %
|
|
|
|
|
GAAP net
income
|
34,627
|
36,098
|
34,162
|
Stock-based
compensation*
|
4,394
|
4,381
|
3,860
|
Acquisition-related
inventory step-up
|
-
|
-
|
2,606
|
Acquisition-related
expenses and contingent
consideration
revaluation
|
-
|
(752)
|
1,355
|
Amortization of
acquired intangible assets
|
1,444
|
1,463
|
1,613
|
Amortization of debt
discount and issuance costs
|
316
|
322
|
320
|
Revaluation of
operating lease liabilities
|
(822)
|
294
|
(546)
|
Tax effect of non-GAAP
adjustments
|
(884)
|
(1,028)
|
(1,883)
|
Non-GAAP net
income
|
39,075
|
40,778
|
41,487
|
|
|
|
|
GAAP basic earnings per
share
|
1.21
|
1.26
|
1.20
|
Non-GAAP basic earnings
per share
|
1.36
|
1.42
|
1.45
|
|
|
|
|
GAAP diluted earnings
per share
|
1.09
|
1.14
|
1.07
|
Non-GAAP diluted
earnings per share
|
1.23
|
1.28
|
1.30
|
|
|
|
|
Shares used for
calculation of earnings per share
(in thousands):
|
|
|
|
Basic
|
28,678
|
28,731
|
28,579
|
Diluted
|
31,824
|
31,737
|
31,968
|
|
|
|
|
|
* Stock-based compensation for the three months ended,
March 31, 2023 included in – Cost of
revenues - 1,165; Research and development, net – 1,784; Sales and
marketing – 847; General and administrative – 598.
NOVA LTD.
SUPPLEMENTAL INFORMATION - RECONCILIATION OF SECOND QUARTER
2023
GAAP TO NON-GAAP GUIDANCE
(Unaudited)
|
Low
|
High
|
Estimated GAAP net
income per diluted share
|
0.75
|
0.89
|
Estimated non-GAAP
items:
|
|
|
Stock-based
compensation
|
0.15
|
0.15
|
Amortization of
acquired intangible assets
|
0.04
|
0.04
|
Amortization of
issuance costs
|
0.01
|
0.01
|
Tax effect of non-GAAP
adjustments
|
(0.03)
|
(0.03)
|
Estimated non-GAAP net
income per diluted share
|
0.92
|
1.06
|
Company Contact:
Dror David, Chief Financial
Officer
Tel: +972-73-229-5760
E-mail -
investors@novami.com
Nova website link - https://www.novami.com/
Investor Relations Contact:
Miri Segal MS-IR LLC
Tel: +917-607-8654
E-mail -
msegal@ms-ir.com
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SOURCE Nova