Investor Presentation

Transcription

1 Investor Presentation May 2018 PASSION. INNOVATION. PERFORMANCE

2 Cautionary Statement Regarding Forward-Looking Statements This presentation includes statements that constitute 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. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are in some cases beyond our control. 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 presentation also involve risks and uncertainties summarized under the heading Risk Factors in Nova s most recent Annual Report on Form 20-F for the year ended December 31, 2017 filed with the Securities and Exchange Commission on February 28, These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Any forward-looking statements contained in this presentation are made as of the presentation date and Nova Measuring Instruments Ltd. is under no obligation to revise or update these forward-looking statements. This following presentation includes financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP). 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. Nova's earning release, including a presentation of the most directly comparable financial measures calculated and presented in accordance with GAAP and a reconciliation of each GAAP to non-gaap financial measure discussed in the presentation is available at the Investors section of the company s website. Certain of the information contained herein concerning economic trends and performance is based upon or derived from information provided by third party consultants and other industry sources. We have not independently verified and cannot assure the accuracy of any data obtained by or from these sources. 2 2

3 WHO NOVA Key Facts DUAL-LISTED NASDAQ / TASE EMPLOYEES 650 METROLOGY Dimensions & Materials TECHNOLOGIES Optical & X-Ray R&D SITES USA & Israel Cash Reserves $150M 2017 PROFITABLE GROWTH Revenues $222M - 35% EPS Growth (non-gaap) 76% 3

4 WHY NOVA Success Tied to Fundamentals Revenue $222M $112M $149M E Operating Expenses $45M $59M $69M E Operating Income Diversified portfolio Differentiated technology o o o X-ray & Optical Dimensions & Materials Coupling HW & SW Customers partnership o Development to Manufacturing o Joint development programs Innovative in disruptive technologies $14M $22M $63M Solid financial model Non GAAP financials E

5 HOW NOVA Innovative Technology Optical/XPS Tool Optical/X-Ray Dimensions/Materials Parameters SW Solutions Physical & Mathematical based Fleet Big Data Management Hybrid Schemes X-Ray XPS + XRF Materials Properties Film Thickness Optical InSitu, Integrated, SA Critical Dimensions Thin Film Unique Complementary Technology 5

6 HOW NOVA Growth Track Record Solid Growth Drivers 18% CAGR (5 Years) $222M Q Highlights $121M $149M $164M Q4 $57M Q3 $54M $123M Record revenues Record profit Diversification: Q2 $56M *Q2 $60M Memory 50% ( %) China 40% ( %) Q1 $54M Q1 $63M * Based on Q guidance 6

7 WHAT NOVA Holistic Approach - Offering Services 20%-25% Dimensions Offering Software 8%-10% Target 45%-50% 20%-25% Materials 7

8 Cluster NOVA Interlacing HW & SW solutions Fleet Management Performance control Open to Hybrid Reference CMP Train and Validate Lithography Inline Monitor Deposition ETCH Retrain Physical Models NOVA MARS Complementary Models - NOVAFit 8

9 Semiconductor Growth Drivers Cycles of Evolution Connected World Mobile Internet Internet of Places Connectivity 2000 Semi Market - $200B Capital Intensity - 17% Source: Gartner & Company Internal Mobility 2010 Semi Market - $300B Capital Intensity - 20% 2017 $400B 2025 Productivity Semi Market - $500-$600B Capital Intensity - 25% 9

10 Healthy Industry Demand Cloud 5G Data Centers IoT Industry 4.0 Blockchain Smart City Network Infrastructure Semi Growth Connected Sensors Smartphones Wearables AI Mobile Devices Automotive AR/ VR Drones Demand for improvement all semi segments High performance Less power More storage Reduced cost 10

11 Metrology Intensity Intensity Growth Beyond Demand LOGIC / FOUNDRIES 70%-100% growth Planar FinFet Nano-Wires Growing Complexity = Growing Intensity Scaled Devices Complex Structures 3D Dimensional Profiles Planar NAND VNAND Gen-1 VNAND Gen-x Materials Properties Multiple Parameters Thin Layers * Per 10K Wafer Start 11 DRAM Gen-1 DRAM Gen-X DRAM Gen-Y Complexity Complex transitions - Environment rich in opportunities DRAM / FLASH 30%-50% growth

12 From Nova200 to Nova300 Revenues $300M Inorganic PC > $50M M&A Materials Metrology $200M $100M Organic $300M Services Dimensional Metrology Target Share Gains SAM/TAM Expansion Disruptive Innovation Market Growth Executed Nova200 Plan Targeting $300M Organically 12

13 Market Exposure Exposed to High End Nodes Exposed to Growing Steps Segment Exposure -2% 0% 2% 4% 6% 8% 10% 12% CMP 12.0% Etch 7.3% 40% Memory Leading-edge Nodes Deposition Lithography 4.9% 2.1% 12% 34% 88% 66% 60% Foundry 2014 Trailing-edge Nodes 2017 WFE CAGR Target Model Advanced Nodes Major Growth Trailing Nodes Sustainable Growth Exposed to Most Growing Segments Segment Diversification 13

14 Customer Exposure Customer Mix Customer Mix UMC 9% Samsung 9% Other 18% 2014 GF 25% TSMC 39% Other 26% Samsung 27% 2017 TSMC 23% Hynix 10% GF 14% Target Model Segment Balance 4 Large Customers Memory Growth Foundry Leadership Foundry Exposure 2 major customers Memory Growth 4 major customers 14

15 Regional Exposure Regional Mix Regional Mix China 4% USA 24% Other 14% China 21% USA 15% Other 5% 2014 Taiwan % Korea 30% Target Model 30% China 3 Large Territories Korea 11% Taiwan 29% Heavy Taiwan Exposure Diversified Territory Mix 15

16 Gaining Share in Growing Markets Addressable Market Market Share Growth +16% $750M $1200M 19% +27% 24% 30% Target Model Unique Value $500M Displacing Other Metrology Emerging Applications Disruptive Innovation E Target Model Expanding TAM Disruptive solutions Gaining Market Share in core metrology markets 16

17 Financial Model Gross Margin [%] Operating Margin [%] 59% 28% 7% 87% 15% 55% E Nova300 Model 56%-59% E Nova300 Model 26%-29% Non GAAP financials 17

18 FUTURE NOVA Future Growth Revenue Growth [$M] $222 Organic growth outperforming industry Inorganic growth > $50M revenues Unique differentiated offering $96 Disruptive innovation $20 $58 New emerging metrology markets Solid operational model E Revenue Doubled Every 5 Years 18

19 THANK YOU PASSION. INNOVATION. PERFORMANCE