- 8 May 2006 -

Veeco scores multiple orders in Taiwan for GaNzilla

Veeco Instruments Inc. has received several multi-unit orders for its GaNzilla II MOCVD system from several key Taiwanese manufacturers of HB-LEDs. Customers who have placed multi-unit orders during the first quarter of 2006 include Huga Optotech Inc., Highlink Technology Corp. and Epitech Technology Corp.

Piero Sferlazzo, VP, GM of Veeco’s MOCVD operations commented, “The GaNzilla II’s leading productivity, high yields and material quality for GaN-based LEDs has resulted in Veeco’s continued success. We believe that Veeco gained market share during the fourth quarter and continues to do so in the beginning of 2006. In addition to these multi-unit orders for new GaNzilla IIs, Veeco also has sold several GaNzilla I reactor upgrade kits which allow our customers to increase the performance of their installed base to results on par with our latest GaNzilla II systems.”

Veeco believes that its GaNzilla II is the most advanced platform currently available for cost-effective, high throughput GaN production of blue, green and UV LEDs and blue spectrum lasers.

Veeco Instruments also announced that it has made a strategic investment in the development of a new Physical Vapor Deposition (PVD) technology with Fluens Corporation of Billerica, MA, USA. They plan jointly to develop a next-generation process for high-rate deposition of aluminium oxide for data storage applications.

Earlier, Veeco Instruments announced its financial results for the first quarter ended March 31, 2006. Edward H. Braun, Veeco's Chairman and CEO, commented, "We are pleased to report solid first quarter Veeco performance. Our revenues for the first quarter were in line with guidance, while orders, gross margins, and EBITA were all up significantly compared to the prior year and guidance.

"First quarter orders increased to $126.7 m, up 28% from the first quarter of 2005, and up 23% sequentially from the fourth quarter of 2005," added Mr. Braun. "Strong orders were driven by double-digit market growth in data storage and in high brightness LED and wireless. Data storage orders were a record $70.4 m, up 55% from the prior year, and HB-LED/wireless orders were $24.3 m, up 74% from the prior year, reflecting market growth in embedded storage in consumer electronics, investment in perpendicular recording, and the beginning of HB-LED backlighting of flat panel TVs. We see continued market acceptance for new Veeco products in our Process Equipment and Metrology segments."

Veeco's revenues for the first quarter of 2006 and 2005 were $93.9 m. First quarter 2006 operating income was $1.6 m, compared with an operating loss of ($1.9) m in the first quarter of 2005. Veeco's first quarter 2006 EBITA was $5.7 m compared to $2.6 m in the first quarter of last year. First quarter net loss was ($0.2) m, compared to a loss of ($4.7) m in the first quarter of 2005.

Veeco's first quarter book-to-bill ratio was 1.35 to 1.00.

Web: www.veeco.com