Veeco Instruments Inc. · NASDAQ:VECO
Veeco Instruments — Merriman Investor Summit 2009
25 slides from Veeco Instruments's conference presentation, Nov 10, 2009
Slide 1: Merriman Investor Summit 2009
Merriman Investor Summit 2009 Deb Wasser, SVP Investor Relations November 10, 2009
Slide 2: Driving the Clean-Tech Revolution
Driving the Clean-Tech Revolution Designs and manufactures Process Equipment and Metrology instruments Focused on the LED & Solar markets 20+ years of experience in thin film deposition Broad IP - over 300 patents Headquartered in Plainview, New York 1,030 employees LTM Revenue of $344 million Exper
Slide 3: Investment Highlights
Investment Highlights Leading equipment supplier for large and multi-year high-growth LED & Solar market opportunity Well positioned to capitalize on current market leadership Deep industry know-how in complex thin film deposition process Significant operating leverage Proven execution track record
Slide 4: Veeco Business Snapshot
Veeco Business Snapshot 5-10% 5-10% >70% CIGS >25% LED Market Growth Rate* #1 or #2 - large share “nanotech tools” #1 equipment supplier for TFMH manufacturing for Hard Drives #1 or #2 Veeco Market Position Atomic Force Microscopes, Stylus & Optical Profilers Ion Beam Etch & Deposition, DLC, PVD, Sa
Slide 5: Focused on High-Growth Clean-Tech Markets
Focused on High-Growth Clean-Tech Markets Bookings ($ in Millions) LED & Solar: 79% Data Storage 34% LED & Solar 29% Metrology 37% Total = $402 2007 Data Storage 22% LED & Solar 54% Metrology 24% Total = $99 3Q 2009 Revenue ($ in Millions) Aligning R&D, Talent and Resources to LED & Solar Opportunit
Slide 6: LED Market is in Early Stages of Phenomenal Growth
LED Market is in Early Stages of Phenomenal Growth 2009–2013 CAGR 2009–2013 CAGR: 32% Mobile: 5% Auto: 16% Signs: 4% Other: 13% LED Market Forecast ($ in Billions) General LED Lighting Represents a Substantial Incremental Upside Lighting: 48% LCD: 122% Analysts forecast approx. $1B MOCVD¹ market in
Slide 7: "The Next Big Thing" is Happening Now – LED-TV
“The Next Big Thing” is Happening Now – LED-TV All major players are investing LG, Samsung, Sony, Sharp, Visio, Toshiba Significant penetration set to occur in 2010 Design & Brand Differentiation High contrast ratio (>3,000,000:1) Color gamut > 105% Power savings LCD-TV market forecasted to grow at
Slide 8: LED Lighting is at the Cusp of Mass Market Adoption
CFL Incandescent Fluorescent CFL Incandescent Fluorescent LED Lighting is at the Cusp of Mass Market Adoption in $120B Illumination Market Sources: Philips Color Kinetics & DOE, Freedonia MOCVD Critical to Drive Down Cost and Improve Brightness Efficiency White LED Cost White LED Efficiency LED Effi
Slide 9: Complex Thin Deposition Process–High Barriers to Entry
Complex Thin Deposition Process–High Barriers to Entry MOCVD is the Critical Process in LED Manufacturing Complex process Extreme precision levels Very high temperature Specialized in deposition of compound semiconductor materials (GaN, AsP) Critical process “Know how” and application expertise Not
Slide 10: Competitive Advantage in MOCVD - Lowest Cost of Ownership Platform
Competitive Advantage in MOCVD - Lowest Cost of Ownership Platform One of two major suppliers with ~30% market share Veeco K465 provides highest throughput 40-120% advantage No cleaning or parts change between runs No particle buildup above wafer Excellent uniformity and repeatability Seamless trans
Slide 11: Veeco Customers Include Over 80% of Key LED Manufacturers
Veeco Customers Include Over 80% of Key LED Manufacturers Japan North America / Europe Shipped Over 200 MOCVD Systems for High Brightness LED Applications Veeco “supplier of choice” for major Korean TV manufacturer Other key accounts in Korea, China and US making backlighting production buys Veeco i
Slide 12: CIGS Emerging as Best High Efficiency, Low Cost Solar Manufacturing Technology
CIGS Emerging as Best High Efficiency, Low Cost Solar Manufacturing Technology CIGS Projected to be the Most Efficient Solar Technology (Cost/Watt Relative to c-Si) CIGS Process Equipment Forecast ($ in M) 2009–2012 CAGR: 74% Source: NREL, Presented at the 33rd IEEE Photovoltaic Specialists Conferen
Slide 13: Veeco is a Key Supplier to CIGS Solar Market
Veeco is a Key Supplier to CIGS Solar Market with Dramatic Growth Opportunity Key Highlights Emerging Solar Customer Universe Components supplier to over 50% of CIGS companies Launched glass and web deposition systems Key systems customers: Global Solar, Daiyang, Group Sat Veeco is well-positioned a
Slide 14: Incremental Growth Upside from Metrology and Data Storage Market Recovery
Incremental Growth Upside from Metrology and Data Storage Market Recovery $0.4M $1.6M Q3’09 EBITA $24.2M $21.7M Q3’09 Revenue Customers Business refocused for profit and growth with new products and lower cost structure Q3 orders remain at trough levels Business restructured for profit through cycle
Slide 15: Outlook and Financials
Veeco Outlook and Financials
Slide 16: Delivering What We Said We Would Do
Delivering What We Said We Would Do GOAL: To Emerge From Downturn in a Position Strength New product traction in all businesses Aligned to customers technology roadmaps Winning business – best order quarter in our history Excellent customer connectivity and relationships Generated cash through the d
Slide 17: Q4 2009 and Full Year Guidance
Q4 2009 and Full Year Guidance* Revenues $120-130 million GAAP EPS $0.22 to $0.31 per share Non-GAAP EPS $0.26 to $0.32 Order Outlook Currently forecast positive book-to-bill in Q409 Full Year ‘09 Outlook Revenue between $353 – $363 Million * Guidance adjusted on 11/09/09 to reflect 5.75M share offe
Slide 18: Substantial Operating Leverage Achieving Near-Term Target Model
Substantial Operating Leverage Achieving Near-Term Target Model Increased variable cost percentage for better performance through industry cycles Greater use of outsourced manufacturing Manufacturing site rationalization (from 8 sites to 4) Simplified organizational structure All 3 business segments
Slide 19: Proceeds from Offering Will Be Used to Bolster Balance Sheet
Proceeds from Offering Will Be Used to Bolster Balance Sheet Pro Forma Capitalization ($ in millions) 139 9 Net Cash 100 100 Total Debt $239 $109 Cash Pro Forma for 5.75M Share Follow-on Sept. 30, 2009 Source: Company filings and Prospectus Supplement dated 10/26/09 Note: Transaction shown net of 4.
Slide 20: Favorable Business Outlook Heading into 2010
Favorable Business Outlook Heading into 2010 Backlog at record level Backlog at end of September $287M; $239M in LED & Solar LED Continue to experience positive business trends in MOCVD High level of demand for K465 MOCVD systems due to industry-leading productivity Executing our manufacturing ramp
Slide 21: Investment Highlights
Investment Highlights Leading equipment supplier for large and multi-year high-growth LED & Solar market opportunity Well positioned to capitalize on current market leadership Deep industry know-how in complex thin film deposition process Significant operating leverage Proven execution track record
Slide 22: [LOGO]
[LOGO]
Slide 23: 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 24: Reconciliation to GAAP Measure Table
Reconciliation to GAAP Measure Table Note: Please see footnotes on the following page. $0.26 $0.32 37,500 37,500 Three months ended Three months ended Three months ended Three months ended Guidance for three (in thousands, except share data) December 31, 2008 March 31, 2009 June 30, 2009 September 3
Slide 25: Reconciliation footnotes
(1) During the fourth quarter of 2008, the Company recorded a restructuring charge of $3.6 million consisting primarily of personnel severance costs and lease-related commitments. (2) During the fourth quarter of 2008, the Company recorded $0.6 million in cost of sales related to the acquisition of