Veeco Instruments Inc. (Nasdaq: VECO) tumbled 43 percent ahead of Friday's bell after it announced preliminary results for the third quarter, and downwardly revised fourth quarter expectations. Its COO is also leaving.
Shares in the company, which makes equipment for the optical telecommunications, data storage, and semiconductor markets, were down 44.53 to 58 on the Island ECN.
Third quarter earnings are now expected to be in the range of 18 to 22 cents a share, lower than the company's prior guidance of 38 to 42 cents a share. First Call was expecting a profit of 40 cents a share. Sales for the third quarter were $93 million, 7 percent above the prior year third quarter, but below company expectations of $104 million.
Veeco's orders for the third quarter were about $175 million, up 32 percent sequentially from the second quarter and 100 percent from the prior year. Half of Veeco's third quarter bookings were from optical telecommunication customers.
Lower sales and earnings were the result of Veeco's recently acquired CVC division, which had a $7 million sales shortfall, causing a 15 cent reduction in earnings per share. Higher costs also came from the transfer of Veeco's Virginia ion beam deposition (IBD) operations to the company's New York facility effective September 30th.
The company said it is taking corrective actions, including restructuring the CVC management team and downsizing of CVC's operations to better reflect the current order rate.
The company also revised its fourth quarter forecast. It now sees fourth quarter 2000 sales will be about $110 million, with earnings in the range of 32 to 37 cents a share. First Call was expecting earnings of 67 cents a share.
For 2001, revenues are expected to be about $570 million with forecasted earnings in the range of $2.40 to $2.50 per share. These revised forecasts are supported by a significant backlog and strong customer acceptance of products, the company said.
Christine B. Whitman, President and Chief Operating Officer, has resigned to pursue other interests. Whitman, who joined Veeco in May when CVC was acquired by Veeco, will continue as a consultant to the Company to assist with a smooth transition. She has also resigned from her position as a member of the Veeco Board of Directors. CEO Edward H. Braun will also act as president.
Veeco will release complete financial results on October 26.