Veeco: Fiscal 1Q12 Financial Results

Veeco Instruments Inc. announced its financial results for the first quarter ended March 31, 2012.

Veeco reports its results on a U.S. GAAP basis, and also provides results excluding certain items. Please refer to the attached table for details of the reconciliation between GAAP operating results and Non-GAAP operating results. All results presented herein are for Veeco’s Continuing Operations.

First Quarter 2012 Results
John R. Peeler, Veeco’s CEO, commented: "We are executing well during the downturn in MOCVD demand. Veeco’s first quarter revenue reached the top of our guidance at $140 million. Adjusted EBITA and non-GAAP earnings per share were $25 million and $0.49, respectively, on strong performance on the gross margin line and good expense management."

Veeco generated about $42 million in cash flow from operations, ending the quarter with $524 million in cash and short term investments. First quarter LED & Solar revenues were $96 million, including $82 million in MOCVD and $14 million in MBE. Data Storage revenues were $44 million.

"As anticipated, we experienced a weak bookings environment in Q1, with total orders of approximately $113 million," continued Peeler. "LED & Solar orders totaled $85 million, with $70 million in MOCVD and $15 million in MBE. MOCVD orders increased 19% sequentially, with system orders from customers in Korea, China, Taiwan, Japan and North America. MBE orders increased 71% sequentially on production orders from wireless customers. Data Storage bookings declined 62% sequentially to $29 million as customer consolidation activity temporarily stalled capacity investments."

Veeco’s book-to-bill ratio was 0.81 to 1 and quarter-end backlog was $305 million.

Second Quarter 2012 Guidance and Outlook
Veeco’s second quarter 2012 revenue is currently forecasted to be between $120 million and $145 million. Earnings per share are currently forecasted to be between $0.20 to $0.40 on a GAAP basis, and $0.29 to $0.48 on a non-GAAP basis. Please refer to the attached financial table for more details.

Peeler commented: "I am proud of our team’s ability to execute, stay nimble and deliver solid profitability in a tough year. We are experiencing growth in our Data Storage and MBE businesses, as well as in Services across all of our technologies. Veeco is focused on keeping our infrastructure lean and discretionary costs low, while at the same time developing next-generation technology solutions to drive future growth. We are on track to deliver 2012 revenue of $500-600 million."

Peeler continued: "While MOCVD bookings grew modestly in the first quarter, we have not yet seen a clear inflection in customer buying patterns. LED customers remain cautious about capacity investment plans and it is still unclear when the MOCVD market will recover. Some positive signs are emerging, including increasing tool utilization rates in Korea, Taiwan and China, and a pick-up in customer quoting activity."

"Overall, we are seeing positive trends in LED lighting – lower prices, more LED lamp products, and heightened consumer awareness. LED manufacturers are focused on how to position their businesses for growth as LEDs become the dominant lighting technology. Despite the business decline in 2012, we firmly believe that the future MOCVD market opportunity will be larger than what we have experienced so far. With leading market share, strong LED customer relationships, technology leadership, and lowest cost of ownership production systems, Veeco is poised for substantive long term growth in LED lighting," concluded Peeler.