Slide 1: Earnings Conference Call 4/25/11
Earnings Conference Call 4/25/11
Slide 2: Introduction
Introduction Debra A. Wasser, SVP, Investor Relations
Slide 3: Safe Harbor Statement
Safe Harbor Statement To the extent that this presentation discusses expectations or otherwise makes statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made.
Slide 4: Q1 2011 Strong Performance Across the Board
Q1 2011 Strong Performance Across the Board See reconciliation to GAAP at end of presentation $ Millions Revenue declined 15% from the record Q4 ‘10 results, as expected, but increased 89% from Q1 ‘10 GAAP EPS was $1.25 and non-GAAP EPS was $1.33 Gross margin was 51% Results in-line with guidance Re
Slide 5: Q1 2011 Revenue & EBITA Performance by Segment
Q1 2011 Revenue & EBITA Performance by Segment Data Storage $40M Down 4% sequentially but up 72% from Q1‘10 Total Revenue: $255M LED & Solar $215M Down 17% sequentially but up 93% from Q1‘10 MOCVD at $204M ($M) Q1 ‘11 Q1 ‘10 Adj EBITA $74 $28 ($M) Q1 ‘11 Q1 ‘10 Adj EBITA $12 $3 See reconciliation to
Slide 6: Q1 2011 Bookings Performance by Segment
Q1 2011 Bookings Performance by Segment Data Storage $33M Down 22% sequentially but up 24% year-over-year Total Bookings: $231M LED & Solar $198M Down 22% sequentially and 6% year-over-year primarily due to timing of customer deposits for MOCVD systems. MOCVD remains strong at $186M Book to Bill = .
Slide 7: Q1 2011 Bookings Highlights
Q1 2011 Bookings Highlights Data Storage $33M 15 customers placed MOCVD orders China strength continues – Lattice Power, Shanghai Epilight, Nantong Tongfang, Smartlighting, Shandong Huaguang, United LED & others Key customer wins in US, Taiwan and Korea Continued to penetrate new accounts and gain s
Slide 8: Q1 2011 P&L Highlights
Q1 2011 P&L Highlights See reconciliation to GAAP at end of presentation ($ millions except GM) Q1’11 Q1’10 Q4’10 Revenues $254.7 $134.8 $300.0 Gross Profit 129.3 56.7 152.8 Gross Margin 50.8% 42.1% 50.9% Operating Income 79.7 25.2 100.9 GAAP Net Income 53.1 22.8 96.7 Non-GAAP Net Income 56.6 17.6 6
Slide 9: Strong Balance Sheet & Cash Generation in Q1 2011
Strong Balance Sheet & Cash Generation in Q1 2011 03/31/2011 12/31/2010 Cash & Short-term Investments* $779.0 $715.4 Accounts Receivable 94.0 150.5 Inventory 121.3 108.5 Fixed Assets, Net 49.0 42.3 Total Assets 1,163.0 1,148.0 Long-term Debt (including current portion) 97.6 104.0 Equity 823.9 762.5
Slide 10: Business Update and Q2 Guidance
Business Update and Q2 Guidance John R. Peeler, CEO
Slide 11: China Update: Establishing a Domestic LED Value Chain
China Update: Establishing a Domestic LED Value Chain National goal to achieve long-term sustainable economic growth Reduce pollution, lower energy consumption, become more energy efficient & increase domestic demand LED lighting: Key opportunity to cultivate green & sustainable industries Part of N
Slide 12: Veeco's China Opportunity Just Beginning
Veeco’s China Opportunity Just Beginning China central and local governments are providing incentives to establish LED manufacturing capacity throughout China MOCVD equipment subsidies (~$1.5M), tax breaks and land grants; regional competition A number of LED Manufacturers plan to invest without per
Slide 13: Veeco CTC Opens to Support Customer Training Requirements
Veeco CTC Opens to Support Customer Training Requirements Goal: Train Hundreds of Engineers to Use Veeco MOCVD Systems China Training Center, Shanghai, China Veeco Becoming “Supplier of Choice” to Chinese Companies
Slide 14: Evolving LED Market Dynamics in Asia
Evolving LED Market Dynamics in Asia Reports of significant improvement in luminous efficiency from Taiwan’s LED epitaxy factories Ex: Formosa Epitaxy recently achieved 150 lm/W for 45mil Blue LED chip Taiwan’s Epistar, Formosa Epitaxy and GPI: utilization rates are rising rapidly and they are becom
Slide 15: MaxBright: Fast Adoption by Key Customers
MaxBright™: Fast Adoption by Key Customers As planned, shipped three 4-chamber systems in Q1 Received multiple orders from leading accounts in Korea, Taiwan, China 3 of the top Taiwanese LED makers have placed MaxBright P.O.s Currently planning to ship 4-8 MaxBright systems in Q2 Very strong pipelin
Slide 16: Other Business Updates
Other Business Updates Solar Shipped CIGS tools to customers in Korea and China...process acceptance underway 2/11: Veeco receives $4.8M DOE grant for FastLine™ technology 4/11: DOE granted $58M to CNSE PVMI project Veeco to be key equipment partner for CIGS flexible tools NYS matching funds will he
Slide 17: Q2 2011 Revenue and Earnings Guidance
Q2 2011 Revenue and Earnings Guidance Revenue $255-285M Gross Margins ~50% Operating Spending $54-55M (19-22%) Adjusted EBITA 30-32% GAAP EPS $1.08-$1.32 Non-GAAP EPS $1.20-$1.45 See reconciliation to GAAP at end of presentation
Slide 18: Q2 2011 Order Outlook
Q2 2011 Order Outlook Currently forecast Veeco’s Q2 orders at 25% or more above Q1 level and we have visibility to continued strength through Q3: Extremely strong levels of quoting activity Fast adoption of MaxBright and continued purchases of market-leading K465i China’s commitment to LED for solid
Slide 19: Reaffirming Full Year 2011 Outlook
Expect 2011 to be a solid year for MOCVD tool demand (BLU and lighting) Veeco opportunity to continue to gain share with most productive MOCVD systems CIGS Solar business will begin to deliver revenue in 2011 as we ship tools to key customers Data Storage business outlook remains favorable with stro
Slide 20: Q&A Session
Q&A Session
Slide 21: Q1 2011 Income Statement
Q1 2011 Income Statement 2011 2010 Net sales 254,676 $ 134,750 $ Cost of sales 125,344 78,010 Gross profit 129,332 56,740 Operating expenses (income): Selling, general and administrative 23,933 17,726 Research and development 24,582 12,956 Amortization 1,135 1,237 Restructuring - (179) Other, net 13
Slide 22: Q1 2011 Balance Sheet
Q1 2011 Balance Sheet March 31, December 31, 2011 2010 (Unaudited) ASSETS Current assets: Cash and cash equivalents 276,837 $ 245,132 $ Short-term investments 426,025 394,180 Restricted cash 76,117 76,115 Accounts receivable, net 94,041 150,528 Inventories, net 121,342 108,487 Prepaid expenses and o
Slide 23: Q1 2011 Reconciliation
Q1 2011 Reconciliation 2011 2010 Adjusted EBITA Operating income 79,669 $ 25,175 $ Adjustments: Amortization 1,135 1,237 Equity-based compensation 3,098 1,866 Restructuring - (179) (1) 83,902 $ 28,099 $ Non-GAAP Net Income Net income from continuing operations (GAAP basis) 53,083 $ 22,825 $ Non-GAAP
Slide 24: Q2 2011 Guidance
Q2 2011 Guidance LOW HIGH Adjusted EBITA Operating income 70,952 $ 86,452 $ Adjustments: Amortization 1,454 1,454 Equity-based compensation 3,818 3,818 76,224 $ 91,724 $ Non-GAAP Net Income Net income from continuing operations (GAAP basis) 46,250 $ 56,792 $ Non-GAAP adjustments: Amortization 1,454
Slide 25: Q1 2011 Segment Information
Q1 2011 Segment Information 2011 2010 LED & Solar Bookings 198,265 $ 211,663 $ Revenues 214,698 $ 111,505 $ Operating income 72,272 $ 27,095 $ Amortization 714 796 Equity-based compensation 977 467 Adjusted EBITA 73,963 $ 28,358 $ Data Storage Bookings 32,615 $ 26,372 $ Revenues 39,978 $ 23,245 $ Op
Slide 26: Earnings Conference Call 4/25/11
Earnings Conference Call 4/25/11