Nova (NVMI) 6-K Current report (foreign)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF 

THE SECURITIES EXCHANGE ACT OF 1934

For the month of November 2019

Commission File No.: 000-30668

NOVA MEASURING INSTRUMENTS LTD.

(Translation of registrant’s name into English)

5 David Fikes Street, Rehovot

P.O.B 266

Israel

 (Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. 

Form 20-F ☒    Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____ 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____ 

Attached hereto and incorporated by way of reference herein is a press release issued by the Registrant and entitled: “Nova Reports Third Quarter 2019 Results”.

The GAAP financial statements tables included in the press release attached hereto are hereby incorporated by reference into the Registrant’s registration statements on Form S-8, filed with the Securities and Exchange Commission on the following dates: November 5, 2007 (File No. 333-147140); October 25, 2012 (File No. 333-184585), March 6, 2015 (File No. 333-202550); and August 25, 2017 (File No. 333-220158).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. 

	NOVA MEASURING INSTRUMENTS LTD.
	(Registrant)
Date: November 7, 2019	By:	/s/ Dror David
		Dror David
		Chief Financial Officer

Company Contact: Dror David, Chief Financial Officer Nova Measuring Instruments Ltd. Tel: +972-73-229-5760 E-mail: info@novami.com  www.novami.com Investor Relations Contact: Miri Segal MS-IR LLC Tel: +917-607-8654 E-mail: msegal@ms-ir.com

Company Press Release

Nova Reports Third Quarter 2019 Results

Rehovot, Israel, November 7, 2019 - Nova (Nasdaq: NVMI) today announced financial results for the third quarter 2019, the period ended September 30, 2019.

Third Quarter 2019 Highlights:

• Quarterly revenue of $52.5 million, meeting guidance of $46 million to $54 million.

• GAAP net income of $8.6 million, or $0.30 per diluted share, exceeding guidance of $0.11 to $0.24 per share

• Non-GAAP net income of $11.5 million, or $0.40 per diluted share, exceeding guidance of $0.20 to $0.34 per share

• Accelerated deliveries to leading edge Foundry to support expansion of its most advanced technology node

• Balanced revenue contribution across segments, geographies and customers

GAAP Results ($K)
	Q3 2019	Q2 2019	Q3 2018
Revenues	$52,507	$51,120	$63,571
Net Income	$8,562	$6,468	$13,310
Earnings per Diluted Share	$0.30	$0.23	$0.46
NON-GAAP Results ($K)
	Q3 2019	Q2 2019	Q3 2018
Net Income	$11,507	$9,007	$15,080
Earnings per Diluted Share	$0.40	$0.32	$0.52

A reconciliation between GAAP operating results and non-GAAP operating results is provided following the financial statements that are part of this release. Non-GAAP results exclude amortization of acquired intangible assets, stock-based compensation expenses, facilities transition costs, revaluation of long-term liabilities and tax effect of non-GAAP adjustments.

Management Comments

"We are pleased with our performance during the third quarter of the year despite the varying market conditions. Based on our focused efforts to execute our plans, revenues came in at the high end of the guidance, while profitability exceeded the guidance range,” commented Eitan Oppenhaim, President and Chief Executive Officer. “Our solid performance during different industry cycles is a result of our technology differentiation, operational efficiency and growing exposure to leading customers from all segments. Following our continuous investment in innovative development, the company is well positioned to capitalize on multiple opportunities once markets resume growth."

2019 Fourth Quarter Financial Outlook

Management provided an outlook for the fourth quarter, the period ending December 31, 2019. Based on current estimates, management expects:

• $56 million to $62 million in revenue

• $0.32 to $0.42 in diluted GAAP EPS

• $0.40 to $0.50 in diluted non-GAAP EPS

2019 Third Quarter Results

Total revenues for the third quarter of 2019 were $52.5 million, an increase of 3% compared to the second quarter of 2019 and decrease of 17% compared to the third quarter of 2018.

Gross margin for the third quarter of 2019 was 52%, compared to a gross margin of 55% in the second quarter of 2019, and compared to the gross margin of 59% in the third quarter of 2018.

Operating expenses in the third quarter of 2019 were $21.0 million, compared with $21.3 in the second quarter of 2019 and compared with $21.7 million in the third quarter of 2018.

On a GAAP basis, the company reported net income of $8.6 million, or $0.30 per diluted share, in the third quarter of 2019. This is compared with $6.5 million, or $0.23 per diluted share, in the second quarter of 2019, and compared with net income of $13.3 million, or $0.46 per diluted share, in the third quarter of 2018.

On a non-GAAP basis, which exclude amortization of acquired intangible assets, stock-based compensation expenses, facilities transition costs, revaluation of long-term liabilities and tax effect of non-GAAP adjustments, the company reported net income of $11.5 million, or $0.40 per diluted share, in the third quarter of 2019. This is compared with net income of $9.0 million, or $0.32 per diluted share, in the second quarter of 2019, and compared with net income of $15.1 million, or $0.52 per diluted share, in the third quarter of 2018.

 

Conference Call Information

Nova will host a conference call today, November 7, 2019, at 9 a.m. Eastern Time, to discuss the financial results and outlook. To attend the conference call, please dial one of the following teleconferencing numbers. Please begin by placing your calls five minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.

U.S. Dial-in Number: 1-800-239-9838

ISRAEL Dial-in Number: 1-809-212-883

INTERNATIONAL Dial-in Number: 1-323-794-2551

At:

9 a.m. Eastern Time

6 a.m. Pacific Time

4 p.m. Israeli Time

Please reference conference ID 6009704

 

The conference call will also be webcast live from a link on Nova's website at http://ir.novami.com.

A replay of the conference call will be available from November 7, 2019 at 12 p.m. Eastern Time to November 14, 2019 at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:

Replay Dial-in TOLL-FREE 1-844-512-2921 

TOLL/INTERNATIONAL 1-412-317-6671

Replay Pin Number: 6009704

A replay will also be available for 90 days on Nova's website at http://ir.novami.com.

About Nova: Nova is a leading innovator and key provider of metrology solutions for advanced process control used in semiconductor manufacturing. Nova delivers continuous innovation by providing state-of-the-art high-performance metrology solutions for effective process control throughout the semiconductor fabrication lifecycle. Nova’s product portfolio, which combines high- precision hardware and cutting-edge software, provides its customers with deep insight into the development and production of the most advanced semiconductor devices. Nova’s unique capability to deliver innovative X-ray and Optical solutions enable its customers to improve performance, enhance product yields and accelerate time to market. Nova acts as a partner to semiconductor manufacturers from its offices around the world. Additional information may be found at www.novami.com.

Nova is traded on the NASDAQ & TASE under the symbol NVMI.

This press release provides financial measures that exclude amortization of acquired intangible assets, stock-based compensation expenses, facilities transition costs, revaluation of long-term liabilities and tax effect of non-GAAP adjustments and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Nova's performance because they reflect our operational results and enhances management's and investors' ability to evaluate Nova's performance before charges or benefits considered by management to be outside Nova's ongoing operating results. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management believes that it is in the best interest of its investors to provide financial information that will facilitate comparison of both historical and future results and allows greater transparency to supplemental information used by management in its financial and operational decision making. A reconciliation of each GAAP to non-GAAP financial measure discussed in this press release is contained in the accompanying financial tables.

This press release contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995 relating to future events or our future performance, such as statements regarding, but are not limited to, anticipated growth opportunities and projections about our business and its future revenues, expenses and profitability. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied in those forward-looking statements. Factors that may affect our results, performance, circumstances or achievements include, but are not limited to, the following: our dependency on three product lines; our dependency on a small number of large customers and small number of suppliers; the highly cyclical and competitive nature of the markets we target and we operate in; our inability to reduce spending during a slowdown in the semiconductor industry; our ability to respond effectively on a timely basis to rapid technological changes; our dependency on PEMs; risks related to exclusivity obligations and non-limited liability that may be included in our commercial agreements and arrangements; our ability to retain our competitive position despite the ongoing consolidation in our industry; risks related to our dependence on our manufacturing facilities; risks related to changes in our order backlog; risks related to efforts to complete and integrate current and/or future acquisitions; risks related to the worldwide financial instabilities; risks related to our intellectual property; new product offerings from our competitors; unanticipated manufacturing or supply problems; risks related to government programs we participate in; risks related to taxation; changes in customer demand for our products; risks related to currency fluctuations; risks related to technology security threats and changes in privacy laws; risks related to acquisitions we may pursue and risks related to our operations in Israel. We cannot guarantee future results, levels of activity, performance or achievements. The matters discussed in this press release also involve risks and uncertainties summarized under the heading “Risk Factors” in Nova’s Annual Report on Form 20-F for the year ended December 31, 2018 filed with the Securities and Exchange Commission on February 28, 2019. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Nova Measuring Instruments Ltd. does not assume any obligation to update the forward-looking information contained in this press release.

(Tables to Follow)

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands) -(Unaudited)

	As of
	September 30, 2019		December 31, 2018
ASSETS
Current assets
Cash and cash equivalents		26,220		22,877
Short-term interest-bearing bank deposits		152,916		152,951
Trade accounts receivable		47,054		53,531
Inventories		50,143		41,786
Other current assets		15,561		10,961
Total current assets		291,894		282,106
Long-term assets
Long-term interest-bearing bank deposits		2,000		2,000
Deferred tax assets		4,627		3,873
Severance pay funds		1,185		1,394
Property and equipment, net		25,914		13,756
Identifiable intangible assets, net		8,227		10,187
Operating lease right-of-use assets		25,415		-
Goodwill		20,114		20,114
Total long-term assets		87,482		51,324
Total assets		379,376		333,430
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Trade accounts payable		18,589		19,015
Deferred revenues		3,715		3,984
Operating lease current liabilities		3,620		-
Other current liabilities		20,340		25,079
Total current liabilities		46,264		48,078
Long-term liabilities
Liability for employee severance pay		2,097		2,254
Operating lease long-term liabilities		25,199		-
Other long-term liabilities		5,180		2,358
Total long-term liabilities		32,476		4,612
Shareholders' equity		300,636		280,740
Total liabilities and shareholders’ equity		379,376		333,430

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 (U.S. dollars in thousands, except per share data) - (Unaudited)

	Three months ended					Nine months ended
	September 30, 2019			September 30, 2018		September 30, 2019		September 30, 2018
Revenues:
Products		38,723			48,953		120,185		144,922
Services		13,784			14,618		40,099		43,140
Total revenues		52,507			63,571		160,284		188,062
Cost of revenues:
Products		16,342			17,615		48,446		53,586
Services		8,672			8,489		24,651		24,952
Total cost of revenues		25,014			26,104		73,097		78,538
Gross profit		27,493			37,467		87,187		109,524
Operating expenses:
Research and development expenses, net		10,548			11,886		34,786		34,961
Sales and marketing expenses		7,156			7,016		20,943		20,689
General and administrative expenses		2,658			2,162		7,564		6,526
Amortization of acquired intangible assets		657			653		1,969		1,960
Total operating expenses		21,019			21,717		65,262		64,136
Operating income		6,474			15,750		21,925		45,388
Financing income, net		887			872		2,252		1,806
Income before tax on income		7,361			16,622		24,177		47,194
Income tax expenses (income)		(1,201	)		3,312		1,391		7,971
Net income for the period		8,562			13,310		22,786		39,223
Earnings per share:
Basic		0.31			0.47		0.82		1.40
Diluted		0.30			0.46		0.80		1.36
Shares used for calculation of earnings per share:
Basic		27,826			28,047		27,935		27,980
Diluted		28,474			28,777		28,599		28,761

NOVA MEASURING INSTRUMENTS LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands) - (Unaudited)

	Three months ended						Nine months ended
	September 30, 2019			September 30, 2018			September 30, 2019			September 30, 2018
Cash flows from operating activities:
Net income for the period		8,562			13,310			22,786			39,223
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		3,842			2,000			9,312			5,534
Amortization of deferred stock-based compensation		1,364			1,254			3,662			3,081
Decrease (increase) in liability for employee termination benefits, net		25			(18	)		52			(53	)
Deferred tax assets, net		(410	)		(188	)		(754	)		(745	)
Decrease (increase) in trade accounts receivable		1,024			(4,998	)		6,477			(7,079	)
Increase in inventories		(1,332	)		(768	)		(9,187	)		(8,004	)
Decrease (increase) in other current assets		(7,180	)		(2,505	)		(4,600	)		1,069
Increase (decrease) in trade accounts payable		1,700			(925	)		(426	)		1,866
Increase (decrease) in other current liabilities and other long-term liabilities		3,247			(496	)		(1,332	)		(7,594	)
Decrease in short term deferred revenues		(1,599	)		(3,233	)		(269	)		(4,083	)
Net cash provided by operating activities		9,243			3,433			25,721			23,215
Cash flow from investment activities:
Decrease (increase) in short-term and long-term interest-bearing bank deposits		(6,040	)		*(5,761	)		35			*(24,410	)
Additions to property and equipment		(7,928	)		(683	)		(15,621	)		(1,779	)
Net cash used in investment activities		(13,968	)		*(6,444	)		(15,586	)		*(26,189	)
Cash flows from financing activities:
Purchases of treasury shares		-			-			(7,159	)		-
Shares issued under employee stock-based plans		95			56			367			294
Net cash provided by (used in) financing activities		95			56			(6,792	)		294
Increase (decrease) in cash and cash equivalents and restricted cash		(4,630	)		*(2,955	)		3,343			*(2,680	)
Cash and cash equivalents and restricted cash – beginning of period		32,850			*28,722			24,877			*28,447
Cash and cash equivalents and restricted cash – end of period		28,220			*25,767			28,220			*25,767
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheet
Cash and cash equivalents		26,220			23,767			26,220			23,767
Restricted cash included in Long-term interest-bearing bank deposits		2,000			2,000			2,000			2,000
Total cash, cash equivalents, and restricted cash		28,220			25,767			28,220			25,767
*reclassified

NOVA MEASURING INSTRUMENTS LTD.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(U.S. dollars in thousands, except percentage and per share data) - (Unaudited)

	Three months ended
	September 30, 2019			June 30, 2019			September 30, 2018
GAAP gross profit		27,493			28,110			37,467
Stock-based compensation expenses (1)		277			222			283
Facilities transition costs (2)		220			271			-
Non-GAAP gross profit		27,990			28,603			37,750
GAAP gross margin as a percentage of revenues		52	%		55	%		59	%
Non-GAAP gross margin as a percentage of revenues		53	%		56	%		59	%
GAAP operating income		6,474			6,775			15,750
Stock-based compensation expenses (1)		1,364			1,086			1,254
Amortization of acquired intangible assets		657			656			653
Facilities transition costs (2)		888			827			-
Non-GAAP operating income		9,383			9,344			17,657
GAAP operating margin as a percentage of revenues		12	%		13	%		25	%
Non-GAAP operating margin as a percentage of revenues		18	%		18	%		28	%
GAAP net income		8,562			6,468			13,310
Stock-based compensation expenses (1)		1,364			1,086			1,254
Amortization of acquired intangible assets		657			656			653
Facilities transition costs (2)		888			827			-
Revaluation of long-term liabilities		362			295			-
Tax effect of non-GAAP adjustments		(326	)		(325	)		(137	)
Non-GAAP net income		11,507			9,007			15,080
GAAP basic earnings per share		0.31			0.23			0.47
Non-GAAP basic earnings per share		0.41			0.32			0.54
GAAP diluted earnings per share		0.30			0.23			0.46
Non-GAAP diluted earnings per share		0.40			0.32			0.52
Shares used for calculation of earnings per share:
Basic		27,826			27,869			28,047
Diluted		28,474			28,564			28,777

(1) Stock-based compensation expenses for the three months ended September 30, 2019 included in – Cost of revenues products - 161; Cost of revenues services - 116; Research and development expenses, net – 534; Sales and marketing expenses – 296; General and administrative expenses – 257.

(2) Facilities transition costs for the three months ended September 30, 2019 included in – Cost of revenues products - 144; Cost of revenues services - 76; Research and development expenses, net – 295; Sales and marketing expenses – 110; General and administrative expenses – 264.