July 30, 2014 - Veeco Instruments Inc. announced its financial results for the second quarter ended June 30, 2014. Veeco reports its results on a U.S. generally accepted accounting principles ("GAAP") basis, and also provides results excluding certain items.
"Veeco achieved $95 million in revenues, up 5% from the first quarter of 2014, and an adjusted EBITA loss of $7 million," commented John R. Peeler, Chairman and Chief Executive Officer. "The Company ended the quarter with a cash balance of $485 million, up $2 million from the prior quarter."
"Our second quarter 2014 orders were $104 million, up when compared with the first quarter of 2014," continued Peeler. "We continue to see positive trends in the LED market, including strong LED chip demand, very high LED fab utilization rates and solid customer quoting activity. First half 2014 MOCVD orders were up nearly 80% from the first half of last year. We had several significant wins during the quarter from LED customers in China and Korea who selected Veeco MOCVD equipment for their capacity expansions. Orders for MOCVD, Data Storage and MBE in the second quarter of 2014 were $75 million, $23 million and $6 million, respectively."
Third Quarter 2014 Guidance
Veeco's third quarter 2014 revenue is currently forecasted to be between $92 million and $100 million. Earnings per share is currently forecasted to be between ($0.43) to ($0.34) on a GAAP basis, and ($0.15) to ($0.07) on a non-GAAP basis. Please refer to the attached financial table for more details. GAAP guidance includes the impact of a planned $2.6 million restructuring charge related to the Company's business and facility streamlining activities this quarter. Note that, starting in the current quarter, Veeco will report adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA), rather than adjusted earnings before interest, taxes and amortization (adjusted EBITA), as its primary non-GAAP earnings measurement.
Business Update and Outlook
"MOCVD business conditions have improved from last year, but we have seen no sustained improvement in our other businesses. We have been working to streamline our business operations and reduce our expense structure, enabling investments in high growth opportunities such as LED and OLED display," commented Peeler. "These activities are planned through the rest of 2014, and are expected to result in an approximately 10% reduction in operating expenses as we exit 2014."
"LED market trends remain favorable, as indicated by our MOCVD first half order and revenue patterns. While quarterly MOCVD order patterns are lumpy, we see solid growth ahead. We currently expect orders in the second half of fiscal 2014 to be better than the first half, driven primarily by growth in MOCVD. We remain focused on delivering improved results by: 1) developing and launching game-changing new products that enable cost effective LED lighting, flexible OLED display encapsulation and other emerging technologies; 2) improving customer cost of ownership as well as our gross margins; 3) driving process improvement initiatives to make us more efficient; and 4) lowering expenses. It is our goal to get the Company back to double-digit adjusted EBITDA profitability by 2015 through a combination of improved business conditions, execution on our growth initiatives, a more streamlined Veeco, and lower operating expenses."