Slide 1: Q2 2010 Highlights Earnings Conference Call 7/26/10
Q2 2010 Highlights Earnings Conference Call 7/26/10
Slide 2: Introduction: Deb Wasser, SVP, Investor Relations
Introduction: Deb Wasser, SVP, Investor Relations
Slide 3: Safe Harbor Statement
Safe Harbor Statement To the extent that this presentation discusses expectations or otherwise make 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. T
Slide 4: John Peeler, CEO
John Peeler, CEO
Slide 5: Q2 2010 – Record Performance Across the Board
Q2 2010 – Record Performance Across the Board Revenue increased 55% from Q1 ’10 and was up ~ 250% from prior year GAAP EPS was $1.20 and non-GAAP EPS was $1.01 * See reconciliation to GAAP at end of Presentation $ Millions $253.0 $68.4 $52.4 -$14.7 -$6.4 $72.0 -$50 $0 $50 $100 $150 $200 $250 $300 Re
Slide 6: Q2'10 Revenue Performance by Segment
Q2’10 Revenue Performance by Segment LED & Solar $186M, up 66% sequentially and 482% Y-O-Y MOCVD Revenues $175M, shipped 81 systems Data Storage $35M, up 54% sequentially and 103% Y-O-Y Metrology $32M, up 11% sequentially and 40% Y-O-Y EBITA improved both sequentially and Y-O-Y in all 3 businesses $
Slide 7: Q2'10 Bookings Performance by Segment
Q2’10 Bookings Performance by Segment LED & Solar $260M, up 23% sequentially and 362% Y-O-Y Data Storage $50M, up 90% sequentially and 159% Y-O-Y Metrology $37M, up 22% sequentially and 59% Y-O-Y B to B = 1.37; Backlog record ~$597M $260M $37M $50M Total: $347M 75.0% 14.0% 11.0% LED/Solar Data Stora
Slide 8: Q2 2010 Bookings Highlights
Q2 2010 Bookings Highlights LED & Solar - $260M $251M MOCVD a new record: penetrated new accounts and gained share 17 customers placed MOCVD orders – all regions – NA, Europe, Taiwan, Korea, Japan Accelerating China orders Continued customer focus on TV and desktop backlighting – plus general illumi
Slide 9: Positive LED Market Trends Continue – The Expanding Universe of LED Manufacturers
Positive LED Market Trends Continue – The Expanding Universe of LED Manufacturers Taiwan Japan North America / Europe Selling to >80% of LED manufacturers worldwide, Veeco holds a market share in excess of 40% and growing 2010 Ship plan includes 35+ LED manufacturers – 2x larger customer list than 2
Slide 10: China MOCVD Subsidies Primarily Focused on Key LED Centers
China MOCVD Subsidies Primarily Focused on 7 Key LED Centers We estimate opportunity for several hundred MOCVD units and over $500M in subsidies 2010-2011 Customers anticipate continued investment into 2012 LED-Focused Investment Programs Often subsidizing equipment buying by multiple companies Many
Slide 11: Additional Financial Highlights, Dave Glass, CFO
Additional Financial Highlights Dave Glass, CFO
Slide 12: P&L Highlights
P&L Highlights 26.0 (14.7) 52.4 GAAP Net Income (Loss) 32.8 (6.4) 68.4 EBITA (Loss) $29.1 ($12.6) $63.8 Operating Income (Loss) 43.1% 33.9% 45.0% Gross Margin 70.3 24.4 113.8 Gross Profit $163.2 $72.0 $253.0 Revenues Q1’10 Q2’09 Q2’10 ($M except GM) See reconciliation to GAAP at end of presentation
Slide 13: Q2 '10 Segment Performance
MOCVD was the overwhelming driver for growth in bookings, revenue & EBITA but Data Storage and Metrology saw strong growth as well Q2 ‘10 Segment Performance 29% 22% 89% 23% Change 32.8 68.4 55% 163.2 253.0 267.8 347.0 Veeco Total -3.1 -3.8 Unallocated Corporate 2.9 3.4 11% 28.5 31.7 29.8 36.5 Metro
Slide 14: Top Line Growth and OPEX Management Drives Record Profitability
Veeco Top Line Growth and OPEX Management Drives Record Profitability 29-31% $52-53M (17-18%) 46-47% $290-315M Q3 ’10F 27% $48M (19%) 45% $253M Q2’10 20% 17% EBITA% $40M (24%) $43M (30%) Operating Spending 43% 45% GM $163M $146M Revenue Q1’10 Q4’09 See reconciliation to GAAP at end of presentation C
Slide 15: Q3 2010 Guidance
Q3 2010 Guidance Revenue $290M-$315M GAAP EPS $1.55-1.82 per share Non-GAAP EPS $1.23-1.43 per share (utilizing 35% tax rate) Note: Share Count 44 Million
Slide 16: Q3 2010 Business Conditions and Outlook
Q3 2010 Business Conditions and Outlook Veeco begins third quarter with a record backlog of nearly $600M Approximately $490M LED & Solar, $78M Data Storage and $29M Metrology LED & Solar business patterns remain strong MOCVD quoting activity remains extremely strong and is similar to what we have be
Slide 17: Summary – John Peeler
Summary – John Peeler Strong Q2’10 Performance and Q3’10 Outlook LED Business Strength Continues: Anticipate another strong Q3 ’10 MOCVD bookings quarter: business conditions remain strong Veeco focused on meeting Q3’10 MOCVD ship target ~100 systems; goal to build capacity for >120 by Q4’10 Next ge
Slide 18: Q&A Session
Q&A Session
Slide 19: Back-Up
Back-Up
Slide 20: Aligning R&D, Talent and Resources to LED & Solar Opportunity
Aligning R&D, Talent and Resources to LED & Solar Opportunity Focused on High-Growth Clean-Tech Markets Bookings ($ in Millions) LED & Solar: 75% Source: Veeco filings Note: Numbers presented may reflect rounding adjustments and consequently totals may not appear to sum $53 $99 $226 $262 $268 $347 $
Slide 21: Consolidated Statement of Operations
31,506 41,683 31,497 43,506 Diluted 31,506 39,283 31,497 39,761 Basic Weighted average shares outstanding: $ (1.13) $ 1.88 $ (0.47) $ 1.20 Diluted $ (1.13) $ 2.00 $ (0.47) $ 1.32 Basic Income (loss) per common share attributable to Veeco: $ (35,582) $ 78,437 $ (14,680) $ 52,393 Net income (loss) att
Slide 22: Consolidated Balance Sheet
$ 605,372 $ 806,366 Total liabilities and equity 359,059 472,015 Equity 107,195 102,763 Total non-current liabilities 1,192 411 Other liabilities 100,964 102,352 Long-term debt 5,039 - Deferred income taxes 139,118 231,588 Total current liabilities 212 220 Current portion of long-term debt 829 14,14
Slide 23: Reconciliation of operating income (loss) to earnings excluding certain items
NOTE - The above reconciliation is intended to present Veeco's operating results, excluding certain items and providing income taxes at a 35% statutory rate. This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States, an
Slide 24: Reconciliation of operating income (loss) to EBITA by segment
** Refer to footnotes on 'Reconciliation of operating income (loss) to earnings (loss) excluding certain items' for further details. $ (16,042) $ 101,179 $ (6,369) $ 68,367 EBITA (loss)** 304 - 304 - Asset impairment charge 1,526 - - - Inventory write-off 6,375 (179) 1,944 - Restructuring 3,553 5,12