UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

 
FORM 8-K

 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

 
Date of Report (Date of earliest event reported):  April 28, 2008
 
VEECO INSTRUMENTS INC.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction
of incorporation)	 	0-16244
(Commission
File Number)	 	11-2989601
(IRS Employer
Identification No.)	

100 Sunnyside Boulevard, Suite B, Woodbury, New York 11797
(Address of principal executive offices, including zip code)	
 
(516) 677-0200
(Registrant’s telephone number, including area code)
 
Not applicable
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
o                   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o                   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o                   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o                   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
Section 2 - Financial Information
 
Item 2.02   Results of Operations and Financial Condition.
 
On April 28, 2008, Veeco issued a press release announcing its financial results for the quarter ended March 31, 2008 .  In connection with the release and the related conference call, Veeco posted a presentation relating to its first quarter 2008 financial results on its website (www.veeco.com).  Copies of the press release and presentation are furnished as Exhibit 99.1 and Exhibit 99.2 to this report.
 
The information in this report, including the exhibits, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, nor shall it be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
 
Section 9 - Financial Statements and Exhibits
 
Item 9.01   Financial Statements and Exhibits.
 
(d)           Exhibits .

Exhibit	 	Description	
 	 	 	
99.1	 	Press release issued by Veeco Instruments Inc. dated April 28, 2008.	
 	 	 	
99.2	 	Veeco Q1 2008 Financial Data Presentation dated April 28, 2008.	
 
2

 
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 hereunto duly authorized.

 	VEECO INSTRUMENTS INC.	
 	 	
April 28, 2008	By:	 /s/ Gregory A. Robbins	
 	 	
 	 	Gregory A. Robbins	
 	 	Senior Vice President and General Counsel	
 
3

 
EXHIBIT INDEX

Exhibit	 	Description	
 	 	 	
99.1	 	Press release issued by Veeco Instruments Inc. dated April 28, 2008.	
 	 	 	
99.2	 	Veeco Q1 2008 Financial Data Presentation dated April 28, 2008.	
 
4

EXHIBIT 99.1

	NEWS	

Veeco Instruments Inc., Terminal Drive, Plainview,  NY 11803 Tel. 1 516-677-0200 Fax. 1 516-677-0380
 
FOR IMMEDIATE RELEASE
Financial Contact: Debra Wasser, SVP Investor Relations & Corporate Communications, 1 516-677-0200 x1472
Media Contact:  Fran Brennen, Senior Director Marcom, 1 516-677-0200 x1222
 
VEECO ANNOUNCES FIRST QUARTER 2008 FINANCIAL RESULTS
 
Plainview, NY, April 28, 2008 — Veeco Instruments Inc. (Nasdaq: VECO) today announced its financial results for the first quarter ended March 31, 2008. Veeco reports its results on a generally accepted accounting principles (“GAAP”) basis, and also provides results excluding certain items.  Investors should refer to the attached table for details of the reconciliation of GAAP operating income to earnings excluding certain items.
 
Veeco will host a conference call reviewing these results at 5:00 pm EDT today at 1-877-723-9511 (toll free) or 1-719-325-4791.  The call will also be webcast live on the Veeco website at http://www.veeco.com.  A replay of the call will be available beginning at 8:00pm EDT through midnight on May 13, 2008 at 888-203-1112 or 719-457-0820, using passcode 3406596, or on the Veeco website. Please also see the Veeco website for a slide presentation reviewing financial data.
 
First Quarter 2008 Highlights
·                   Revenue was $102.3 million, in line with Veeco’s guidance of $98-$105 million;
·                   Bookings were $109.3 million, in line with Veeco’s guidance of $105-$112 million;
·                   Net loss was ($1.6) million, or ($0.05) per share, compared to net income of $0.3 million, or $0.01 per share, last year. The current quarter net loss includes a restructuring and asset impairment charge of $3.2 million principally related to the consolidation and relocation of Veeco’s Corporate headquarters in the first quarter.
·                   Veeco’s earnings per share, excluding certain items, was $0.09 compared to earnings per share of $0.10 last year, ahead of Veeco’s guidance of $0.00-$0.06 per share.
 
John R. Peeler, Veeco’s Chief Executive Officer, commented, “We are pleased to report in-line revenues and better than expected earnings due to our restructuring and cost containment efforts and better than anticipated gross margins, up sequentially from 37.9% to 41.7%.  We are on track to improve Veeco’s performance on both the top and bottom line in 2008.”
 
“Veeco’s LED & Solar Process Equipment business reported revenues of $42.1 million and EBITA of $8.6 million, now representing our largest segment at 41% of revenues.  These results were significantly improved both on a year-over-year and sequential basis. In Data Storage Process Equipment, while we reported a weak revenue quarter as expected, our bookings increased to over $40 million, driven by increased capital expenditures and technology spending by key hard drive customers. We also reported a sequential recovery in the profitability of our Metrology business. Bookings in Metrology were weak due to slow scientific research/industrial spending which impacted our instruments products, and continued semiconductor industry softness.”

 
First Quarter 2008 Summary
 
Veeco’s revenue for the first quarter of 2008 was $102.3 million, compared to $99.2 million in the first quarter of 2007. First quarter 2008 operating income was $0.1 million, which includes the previously noted $3.2 million in restructuring and asset impairment charges, compared with operating income of $1.7 million in the first quarter of 2007.  Veeco’s first quarter 2008 earnings before interest, taxes and amortization excluding certain charges (EBITA) was $5.3 million, compared to $5.6 million last year.  First quarter 2008 net loss was ($1.6) million, or ($0.05) per share, compared to net income of $0.3 million, or $0.01 per share, in the first quarter of 2007. Excluding restructuring, asset impairment and amortization expenses and using a 35% tax rate in both periods, first quarter 2008 earnings per share were $0.09, compared to $0.10 in 2007.
 
Outlook
 
The Company forecasts second quarter 2008 revenues to be in the range of $102-$110 million.  Veeco’s earnings per share is currently forecasted to be between $(0.02) – $0.07 on a GAAP basis, and earnings per share are currently forecasted to be between $0.05 to $0.11 on a non-GAAP basis (excluding amortization of $2.0 million and using a 35% tax rate). Veeco currently expects that its second quarter 2008 bookings will be greater than the first quarter, with a range of $110-$118 million.  The Company currently anticipates sequential bookings increases in the LED & Solar Process Equipment and Metrology segments. For the full year, Veeco reaffirms its guidance of revenue growth at a minimum of 10% to $440 million.
 
About Veeco
 
Veeco Instruments Inc. manufactures enabling solutions for customers in the HB-LED, solar, data storage, semiconductor, scientific research and industrial markets. We have leading technology positions in our three businesses: LED & Solar Process Equipment, Data Storage Process Equipment, and Metrology Instruments. Veeco’s manufacturing and engineering facilities are located in New York, New Jersey, California, Colorado, Arizona and Minnesota. Global sales and service offices are located throughout the U.S., Europe, Japan and APAC.  http://www.veeco.com
 
To the extent that this news release discusses expectations or otherwise makes statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include the risks discussed in the Business Description and Management’s Discussion and Analysis sections of Veeco’s Annual Report on Form 10-K for the year ended December 31, 2007 and in our subsequent
quarterly reports on Form 10-Q, current reports on Form 8-K and press releases.  Veeco does not undertake any obligation to update any forward-looking statements to reflect future events or circumstances after the date of such statements.
 
- financial tables attached-

 
Veeco Instruments Inc. and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)

 	 	Three months ended	 	
 	 	March 31,	 	
 	 	2008	 	2007	 	
 	 	 	 	 	 	
Net sales	 	$	102,307	 	$	99,166	 	
Cost of sales	 	59,681	 	55,471	 	
Gross profit	 	42,626	 	43,695	 	
 	 	 	 	 	 	
Operating expenses:	 	 	 	 	 	
Selling, general and administrative expense	 	22,628	 	22,806	 	
Research and development expense	 	14,726	 	15,389	 	
Amortization expense	 	1,956	 	3,909	 	
Restructuring expense	 	2,875	 	—	 	
Asset impairment charge	 	285	 	—	 	
Other expense (income), net	 	4	 	(147	)	
 	 	 	 	 	 	
Operating income	 	152	 	1,738	 	
 	 	 	 	 	 	
Interest expense, net	 	892	 	819	 	
Gain on extinguishment of debt	 	—	 	(738	)	
 	 	 	 	 	 	
(Loss) income before income taxes and noncontrolling interest	 	(740	)	1,657	 	
 	 	 	 	 	 	
Income tax provision	 	919	 	1,494	 	
Noncontrolling interest	 	(76	)	(130	)	
Net (loss) income	 	$	(1,583	)	$	293	 	
 	 	 	 	 	 	
(Loss) income per common share:	 	 	 	 	 	
Net (loss) income per common share	 	$	(0.05	)	$	0.01	 	
Diluted net (loss) income per common share	 	$	(0.05	)	$	0.01	 	
 	 	 	 	 	 	
Weighted average shares outstanding	 	31,161	 	30,899	 	
Diluted weighted average shares outstanding	 	31,161	 	31,281	 	

 
Veeco Instruments Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)

 	 	March 31,	 	December 31,	 	
 	 	2008	 	2007	 	
 	 	(Unaudited)	 	 	 	
ASSETS	 	 	 	 	 	
Current assets:	 	 	 	 	 	
Cash and cash equivalents	 	$	114,429	 	$	117,083	 	
Accounts receivable, net	 	76,753	 	75,207	 	
Inventories, net	 	105,169	 	98,594	 	
Prepaid expenses and other current assets	 	7,739	 	8,901	 	
Deferred income taxes	 	2,929	 	2,649	 	
Total current assets	 	307,019	 	302,434	 	
 	 	 	 	 	 	
Property, plant and equipment, net	 	65,661	 	66,142	 	
Goodwill	 	100,898	 	100,898	 	
Other assets, net	 	58,382	 	59,860	 	
Total assets	 	$	531,960	 	$	529,334	 	
 	 	 	 	 	 	
LIABILITIES AND SHAREHOLDERS’ EQUITY	 	 	 	 	 	
Current liabilities:	 	 	 	 	 	
Accounts payable	 	$	38,101	 	$	36,639	 	
Accrued expenses	 	55,883	 	60,201	 	
Deferred profit	 	4,330	 	3,250	 	
Income taxes payable	 	2,066	 	2,278	 	
Current portion of long-term debt	 	25,418	 	25,550	 	
Total current liabilities	 	125,798	 	127,918	 	
 	 	 	 	 	 	
Deferred income taxes	 	4,351	 	3,712	 	
Long-term debt	 	120,987	 	121,035	 	
Other non-current liabilities	 	3,026	 	1,978	 	
 	 	 	 	 	 	
Noncontrolling interest	 	938	 	1,014	 	
 	 	 	 	 	 	
Shareholders’ equity	 	276,860	 	273,677	 	
Total liabilities and shareholders’ equity	 	$	531,960	 	$	529,334	 	

 
Veeco Instruments Inc. and Subsidiaries
Reconciliation of operating income to earnings excluding certain items
(In thousands, except per share data)
(Unaudited)

 	 	Three months ended	 	
 	 	March 31,	 	
 	 	2008	 	2007	 	
 	 	 	 	 	 	
Operating income	 	$	152	 	$	1,738	 	
 	 	 	 	 	 	
Adjustments:	 	 	 	 	 	
 	 	 	 	 	 	
Amortization expense	 	1,956	 	3,909	 	
Restructuring expense	 	2,875	(1)	—	 	
Asset impairment charge	 	285	(2)	—	 	
 	 	 	 	 	 	
Earnings before interest, income taxes and amortization excluding certain items (“EBITA”)	 	5,268	 	5,647	 	
 	 	 	 	 	 	
Interest expense, net	 	892	 	819	 	
Gain on extinguishment of debt	 	—	 	(738	)(3)	
Adjustment to exclude gain on extinguishment of debt	 	—	 	738	 	
 	 	 	 	 	 	
Earnings excluding certain items before income taxes	 	4,376	 	4,828	 	
 	 	 	 	 	 	
Income tax provision at 35%	 	1,532	 	1,690	 	
Noncontrolling interest, net of income tax provision at 35%	 	(49	)	(85	)	
 	 	 	 	 	 	
Earnings excluding certain items	 	$	2,893	 	$	3,223	 	
 	 	 	 	 	 	
Earnings excluding certain items per diluted share	 	$	0.09	 	$	0.10	 	
 	 	 	 	 	 	
Diluted weighted average shares outstanding	 	31,301	 	31,281	 	

(1)	During the first quarter of 2008, the Company recorded a restructuring charge of $2.9 million, consisting of $2.6 million of costs	
associated with the consolidation and relocation of the lease for our Corporate headquarters, and $0.3 million of personnel  severance costs.	
 	
(2)	During the first quarter of 2008, the Company recorded a $0.3 million asset impairment charge related to fixed asset write-offs	
associated with the consolidation and relocation of our Corporate headquarters.	
 	
(3)	During the first quarter of 2007, the Company repurchased $56.0 million aggregate principal amount of its 4.125% convertible	
subordinated notes. As a result of these repurchases, the Company recorded a gain from the early extinguishment of debt in the	
amount of $0.7 million.	
 	 	
NOTE - The above reconciliation is intended to present Veeco’s operating results, excluding certain items and providing income taxes at a 35% statutory rate. This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States, and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on EBITA, which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes EBITA reports baseline performance and thus provides useful information.	

 
Veeco Instruments Inc. and Subsidiaries
Segment Revenues, Bookings, and Reconciliation
of Operating Income (Loss) to EBITA
(In millions)
(Unaudited)

 	 	Three months ended	 	
 	 	March 31,	 	March 31,	 	
 	 	2008	 	2007	 	
LED & Solar Process Equipment	 	 	 	 	 	
Bookings	 	$	38.7	 	$	36.4	 	
Revenues	 	42.1	 	22.4	 	
 	 	 	 	 	 	
Operating income (loss)	 	8.1	 	(0.5	)	
Amortization expense	 	0.5	 	2.3	 	
EBITA	 	8.6	 	1.8	 	
 	 	 	 	 	 	
Data Storage Process Equipment	 	 	 	 	 	
Bookings	 	40.6	 	32.3	 	
Revenues	 	24.1	 	35.7	 	
 	 	 	 	 	 	
Operating (loss) income	 	(2.6	)	1.4	 	
Amortization expense	 	1.0	 	1.0	 	
Restructuring expense	 	0.1	 	—	 	
EBITA	 	(1.5	)	2.4	 	
 	 	 	 	 	 	
Metrology	 	 	 	 	 	
Bookings	 	30.0	 	37.2	 	
Revenues	 	36.1	 	41.1	 	
 	 	 	 	 	 	
Operating income	 	1.2	 	3.6	 	
Amortization expense	 	0.4	 	0.4	 	
Restructuring expense	 	0.2	 	—	 	
EBITA	 	1.8	 	4.0	 	
 	 	 	 	 	 	
Unallocated Corporate	 	 	 	 	 	
Operating loss	 	(6.6	)	(2.8	)	
Amortization expense	 	0.1	 	0.2	 	
Restructuring expense	 	2.6	 	—	 	
Asset impairment charge	 	0.3	 	—	 	
EBITA	 	(3.6	)	(2.6	)	
 	 	 	 	 	 	
Total	 	 	 	 	 	
Bookings	 	109.3	 	105.9	 	
Revenues	 	102.3	 	99.2	 	
 	 	 	 	 	 	
Operating income	 	0.1	 	1.7	 	
Amortization expense	 	2.0	 	3.9	 	
Restructuring expense	 	2.9	 	—	 	
Asset impairment charge	 	0.3	 	—	 	
EBITA	 	$	5.3	 	$	5.6	 	

** Refer to footnotes on Reconciliation of operating income to earnings excluding certain items

Exhibit 99.2

	Q1 ’08 Financial Data April 28, 2008	

	©2008 Veeco Instruments Inc 042808 Investor Slides 2 $30 $39 $40 $24 $42 $36 First Quarter Segment Results LED & Solar Process Equipment Data Storage Process Equipment Metrology LED & Solar Process Equipment Data Storage Process Equipment Metrology (41%) (24%) (35%) (36%) (37%) (27%) Q1 08 Revenues ($M) $102 Million Q1 08 Bookings ($M) $109 Million	

	©2008 Veeco Instruments Inc 042808 Investor Slides 3 Q1 2008 Financials ($M except EPS) * Excludes $4.8M inventory write-off associated with restructuring. Reported gross margin is 33% ** See reconciliation to GAAP at end of presentation Q4 ’07 $114.9 $106.8 38%* ($8.6) $4.1 $0.07 Q1 ’07 $105.9 $99.2 44% $1.7 $5.6 $0.10 Q1 ’08 $109.3 $102.3 42% $0.2 $5.3 $0.09 Orders Revenues Gross Margin Operating Income (Loss) EBITA** EPS (Non-GAAP)** • In-line revenues and better than expected earnings due to restructuring and cost-containment • Better than anticipated Gross Margins, up 380 basis points sequentially	

	©2008 Veeco Instruments Inc 042808 Investor Slides 4 Q1 Segment Data: Y/Y and Sequential Highlights 4.1 5.6 5.3 EBITA 37.9% 44.1% 41.7% Gross Margin 114.9 105.9 109.3 Bookings 106.8 99.2 102.3 Revenues Total (2.4) (2.6) (3.6) Unallocated Corporate (1.5) 4.0 1.8 EBITA 39.3% 49.4% 46.6% Gross Margin 36.6 37.2 30.0 Bookings 35.8 41.1 36.1 Revenues Metrology 2.8 2.4 (1.5) EBITA 34.9% 41.6% 35.3% Gross Margin 35.8 32.3 40.6 Bookings 37.3 35.7 24.1 Revenues Data Storage Process Equipment 5.2 1.8 8.6 EBITA 39.8% 38.2% 41.0% Gross Margin 42.5 36.4 38.7 Bookings 33.7 22.4 42.1 Revenues LED/Solar Process Equipment Q4 2007 Q1 2007 Q1 2008 ($ millions)	

	©2008 Veeco Instruments Inc 042808 Investor Slides 5 2008 “Recovery Year” Goal is revenue growth at a minimum of 10% to $440M Operating spending forecasted to decline as a percentage of sales (38% in ’07 to 36-37% ’08) Continued focus on gross margin improvements: – Better than anticipated GMs in Q1 (41.7% vs. guidance of 39%)... anticipate continued GM improvements in 2H ‘08s – Driving margin improvement independent of volume • Better pricing • Global supply chain initiatives • Outsourcing Cost containment focus so that spending does not get ahead of revenue growth . . . continued improvements in expense structure	

	©2008 Veeco Instruments Inc 042808 Investor Slides 6 Veeco’s 2008 Growth Outlook ~$440M ~10% $402M TOTAL $157-160M ~5-7% $150M Metrology $137-143M ~0-5% $136M Data Storage Process Equipment $140-145M ~20-25% $116M LED & Solar Process Equipment 2008 Revenue Range 2008 Revenue Growth Range* 2007 Revenue * Based upon end market industry forecasts (Strategy Analytics, IDC) and Veeco Estimates	

	©2008 Veeco Instruments Inc 042808 Investor Slides 7 Q2 ’08 Guidance Q2 ‘08 Revenues $102-$110 million Q2 ‘08 Earnings ($0.02)-$0.07 per share GAAP Non-GAAP EPS $0.05 - $0.11 excluding amortization of $2.0 million, using a 35% tax rate Q2 ‘08 Orders $110-$118 million	

	©2008 Veeco Instruments Inc 042808 Investor Slides 8 Gross Margin Improvement Model >5% 11 - 14% 3-5% 5.1% 2.7% 3.8% EBITA (%) 36-37% 32 - 34% 36-38% 36.5% 37.6% 34.1% Operating Expenses 42% 45-46% 41% 41.7% 40% 37.9% TOTAL 52% 46% 46.6% 44.1% 39.3% Metrology 43% 39% 39.0% 38.1% 37.2% Process Equipment Gross Margin > $440M $125-130M $102-$110M $102.3M $402M $106.8M Revenue 2008 Target Peak Quarter Q2’08 F Q1’08 2007 Full Year Q4 2007 Anticipate higher Q2 spending levels due to raises, additional hiring in LED & Solar PE	

	©2008 Veeco Instruments Inc 042808 Investor Slides 9 Veeco Balance Sheet December 31, 2007 March 31, 2008 $273.7 $276.9 Shareholder’s Equity 146.6 146.4 Long-Term Debt (including current portion) 529.3 532.0 Total Assets 66.1 65.7 Fixed Assets 174.5 181.2 Working Capital $117.1 $114.4 Cash and Investments (in millions)	

	©2008 Veeco Instruments Inc 042808 Investor Slides 10 Safe Harbor Statement To the extent that this presentation discusses expectations or otherwise make statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include the risk factors discussed in the Business Description and Management's Discussion and Analysis sections of Veeco's Annual Report on Form 10-K for the year ended December 31, 2007 and subsequent Quarterly Reports on Form 10-Q and current reports on Form 8-K. Veeco does not undertake any obligation to update any forward-looking statements to reflect future events or circumstances after the date of such statements. In addition, this presentation includes non-GAAP financial measures. For GAAP reconciliation, please refer to the reconciliation section in this presentation as well as Veeco’s financial press releases and 10-K and 10-Q filings available on www.veeco.com.	

	©2008 Veeco Instruments Inc 042808 Investor Slides 11 Back-Up and Reconciliation Slides	

	©2008 Veeco Instruments Inc 042808 Investor Slides 12 Q1 ’08 Veeco Reconciliation Table 31,281 31,301 Diluted weighted average shares outstanding $0.10 $0.09 Earnings excluding certain items per diluted share $3,223 $2,893 Earnings excluding certain items (85) (49) Noncontrolling interest, net of income tax provision at 35% 1,690 1,532 Income tax provision at 35% 4,828 4,376 Earnings excluding certain items before income taxes 738 - Adjustment to exclude gain on extinguishment of debt (738) - Gain on extinguishment of debt 819 892 Interest expense, net 5,647 5,268 Earnings before interest, income taxes and amortization excluding certain items ("EBITA") - 285 Asset impairment charge - 2,875 Restructuring expense 3,909 1,956 Amortization expense Adjustments: $1,738 $152 Operating income 2007 2008 (1) (2) (3) Three months ended March 31, NOTE - The above reconciliation is intended to present Veeco's operating results, excluding certain items and providing income taxes at a 35% statutory rate. This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States, and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on EBITA, which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes EBITA reports baseline performance and thus provides useful information. 1. During the first quarter of 2008, the Company recorded a restructuring charge of $2.9 million, consisting of $2.6 million of costs associated with the consolidation and relocation of the lease for our Corporate headquarters, and $0.3 million of personnel severance costs. 2. During the first quarter of 2008, the Company recorded a $0.3 million asset impairment charge related to fixed asset write-offs associated with the consolidation and relocation of our Corporate headquarters. 3. During the first quarter of 2007, the Company repurchased $56.0 million aggregate principal amount of its 4.125% convertible subordinated notes. As a result of these repurchases, the Company recorded a gain from the early extinguishment of debt in the amount of $0.7 million.	

	©2008 Veeco Instruments Inc 042808 Investor Slides 13 Q1 2008 Segment Reconciliation March 31, March 31, 2008 2007 LED & Solar Process Equipment Bookings 38.7 $ 36.4 $ Revenues 42.1 22.4 Operating income (loss) 8.1 (0.5) Amortization expense 0.5 2.3 EBITA 8.6 1.8 Data Storage Process Equipment Bookings 40.6 32.3 Revenues 24.1 35.7 Operating (loss) income (2.6) 1.4 Amortization expense 1.0 1.0 Restructuring expense 0.1 - EBITA (1.5) 2.4 Metrology Bookings 30.0 37.2 Revenues 36.1 41.1 Operating income 1.2 3.6 Amortization expense 0.4 0.4 Restructuring expense 0.2 - 1.8 4.0 Unallocated Corporate Operating loss (6.6) (2.8) Amortization expense 0.1 0.2 Restructuring expense 2.6 - Asset impairment charge 0.3 - EBITA (3.6) (2.6) Total Bookings 109.3 105.9 Revenues 102.3 99.2 Operating income 0.1 1.7 Amortization expense 2.0 3.9 Restructuring expense 2.9 - Asset impairment charge 0.3 - EBITA 5.3 $ 5.6 $ ** Refer to footnotes on reconciliation of operating income to earnings excluding certain items Three months ended Segment Revenues, Bookings, and Reconciliation of Operating Income (Loss) to EBITA (In millions, unaudited)	

	©2008 Veeco Instruments Inc 042808 Investor Slides 14 Q2 ‘08 Guidance Reconciliation Table LOW HIGH Operating income $1,000 $4,000 Amortization expense 2,000 2,000 Earnings before interest, income taxes and amortization excluding certain items ("EBITA") 3,000 6,000 Interest expense, net 800 800 Earnings excluding certain items before income taxes 2,200 5,200 Income tax expense at 35% 770 1,820 Noncontrolling interest, net of income tax provision at 35% (65) (65) Earnings excluding certain items $1,495 $3,445 Earnings excluding certain items per diluted share $0.05 $0.11 Diluted weighted average shares outstanding 31,600 31,600 Veeco Instruments Inc. and Subsidiaries Reconciliation of operating (loss) income to earnings excluding certain items (In thousands, except per share data) (Unaudited) Guidance for the Three months ended June 30, 2008 Note: The forecasted income tax expenses for the three months ending June 30, 2008 is $1.0 million for both high end and low end guidance. NOTE: The above reconciliation is intended to present Veeco’s operating results, excluding certain items and providing income taxes at a 35% statutory rate. This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States, and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on EBITA, which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes EBITA reports baseline performance and thus provides useful information.	

	©2008 Veeco Instruments Inc 042808 Investor Slides 15 2007 Segment Data March 31, June 30, September 30, December 31, 2007 2007 2007 2007 LED & Solar Process Equipment Bookings 36.4 $ 36.4 $ 48.7 $ 42.5 $ Revenues 22.4 28.0 31.8 33.7 Operating (loss) income (0.5) 2.8 2.7 4.7 Amortization expense 2.3 1.0 0.5 0.5 EBITA 1.8 3.8 3.2 5.2 Data Storage Process Equipment Bookings 32.3 41.3 32.2 35.8 Revenues 35.7 32.1 31.1 37.3 Operating income (loss) 1.4 0.6 (2.2) (6.4) Amortization expense 1.0 1.0 1.0 1.0 Restructuring expense - - 0.2 2.3 Asset impairment charge - - - 1.1 Inventory write-off - - - 4.8 EBITA 2.4 1.6 (1.0) 2.8 Metrology Bookings 37.2 34.8 37.4 36.6 Revenues 41.1 38.7 34.8 35.8 Operating income (loss) 3.6 (0.6) (0.8) (2.4) Amortization expense 0.4 0.3 0.4 0.3 Restructuring expense - 0.6 0.6 EBITA 4.0 0.3 (0.4) (1.5) Unallocated Corporate Operating loss (2.8) (3.9) (3.9) (4.4) Amortization expense 0.2 0.1 0.1 0.2 Restructuring expense - 0.8 0.3 1.8 EBITA (2.6) (3.0) (3.5) (2.4) Total Bookings 105.9 112.5 118.3 114.9 Revenues 99.2 98.8 97.7 106.8 Operating income (loss) 1.7 (1.1) (4.2) (8.5) Amortization expense 3.9 2.4 2.0 2.0 Restructuring expense - 1.5 0.5 4.7 Asset impairment charge - - - 1.1 Inventory write-off - - - 4.8 EBITA 5.6 $ 2.8 $ (1.7) $ 4.1 $ Three months ended Segment Revenues, Bookings, and Reconciliation of Operating Income (Loss) to EBITA (In millions, unaudited)