FORT WASHINGTON, Pa., Aug 04, 2010 (BUSINESS WIRE) -- Kulicke & Soffa Industries, Inc. (NASDAQ: KLIC) ("K&S" or the "Company")today announced results for its third fiscal quarter ended July 3, 2010. This press release contains both GAAP results and non-GAAP measures.

For its third fiscal quarter of 2010, the Company reported net revenue of $221.3 million and net income of $49.1 million, or $0.65 per diluted share. On a non-GAAP basis* for its third quarter, the Company reported net income of $55.6 million, or $0.74 per diluted share.

Quarterly GAAP Results
						Change vs.			Change vs.
			Fiscal Q3 2010			Fiscal Q3 2009**			Fiscal Q2 2010**
Net Revenue			$221.3 million			325%			44%
Gross Profit			$99.2 million			404%			46%
Gross Margin			44.8%			706 basis points			77 basis points
Income from Operations			$50.1 million			N/M ***			115%
Operating Margin			22.6%			5,043 basis points			746 basis points
Net Income			$49.1 million			N/M ***			132%
Net Margin			22.2%			5,149 basis points			843 basis points
EPS - Diluted			$0.65			N/M ***			132%
Quarterly Non-GAAP Measures*
						Change vs.			Change vs.
			Fiscal Q3 2010			Fiscal Q3 2009**			Fiscal Q2 2010**
Gross Profit			$99.2 million			403%			46%
Gross Margin			44.8%			700 basis points			76 basis points
Income from Operations			$55.1 million			N/M ***			98%
Operating Margin			24.9%			4,756 basis points			681 basis points
Net Income			$55.6 million			N/M ***			104%
Net Margin			25.1%			4,821 basis points			746 basis points
EPS - Diluted			$0.74			N/M ***			106%

* Non-GAAP measures exclude: equity-based compensation; amortization of intangibles; restructuring; Switzerland pension plan curtailment; non-cash interest expense; net tax settlement expense (benefit) and other tax adjustments; and related tax effects on non-GAAP adjustments (see reconciliations of GAAP results to Non-GAAP measures in the following financial schedules).

** As adjusted for ASC No. 470.20, Debt, Debt With Conversion Options.

*** Not meaningful as comparable period was a loss.

Commenting on the results, Scott Kulicke, Chief Executive Officer, said, "In the June quarter our operations team did a terrific job ramping up production in response to the unprecedented customer demand we are currently experiencing. As a result, we were able to beat our revenue guidance, deliver strong financial performance and demonstrate the strength of our business model.

"Our equipment business grew almost 50% over the March quarter, driven by continued demand from both IDM and subcontractor customers, and across all application spaces. Especially noteworthy were ball bonder shipments for LED applications, which almost doubled over the March quarter, and heavy wire wedge bonder shipments which were up about 50% over the March quarter. We're also starting to see increasing demand from the memory segment. Lastly, the industry's transition to copper continues to be a strong driver of demand, and of our rising market share.

"Last month we commented that we had seen some volatility in our order book as one of our customers had pushed out some deliveries originally scheduled for the September quarter. I'm happy to report that that customer quickly reversed course and pulled some of those machines back into the quarter and that, as we predicted, we easily sold the rest of those delivery slots to other customers eager for capacity.

"We believe it is important for investors to understand that some volatility in our order book is normal, and does not detract from our confidence, based on orders already in hand, for both the September and December quarters. We expect September quarter revenue to be in the $250 million to $260 million range, and, while it is too early to provide December quarter guidance, we can say that we expect that quarter's revenue to be about comparable to September.

"Finally, let me point out that 2010's profitability and cash generation is allowing us to make significant improvements to our capital structure. When coupled with ball bonder market share expansion, continued penetration into the LED market, ongoing strength in the wedge bonder market and initial orders for our iStack die bonder, K&S has a solid foundation for ongoing success."

Key Product Trends

 

• Ball bonder units and revenue were up approximately 50% over the March quarter.
  • Continued strong demand for the K&S copper solution; ball bonders configured for copper remain at approximately 60% of all ball bonder shipments.
  • LED ball bonder shipments almost doubled over March quarter levels.
• Heavy wire wedge bonder demand continued to increase, with sales approximately 50% over the March quarter; further incremental demand is anticipated through the September quarter.
• Our recently launched die bonder product continues to gain customer acceptance.

Financial Highlights

 

• Revenue increased 44% sequentially, exceeding previous guidance by $16.3 million.
• GAAP operating margin was 22.6%, or 24.9% on a non-GAAP basis.
• GAAP net income was $49.1 million, up $27.9 million from the previous quarter.
• GAAP diluted EPS was $0.65, up $0.37 from the previous quarter.
• Continuing operations generated $27.7 million of net cash.
• Completed redemption of $49.0 million in Convertible Subordinated Notes due June 30, 2010 using cash on hand.
• Net revenue for the September quarter is expected to be in the $250 million to $260 million range, revenue of this magnitude is anticipated to follow in December.

Earnings Conference Call Details

A conference call to discuss these results will be held tomorrow, August 5, 2010 beginning at 9:00 am (ET). To access the conference call, interested parties may call (877) 407-8037 or (201) 689-8037, or log on to Investor Events for listen-only mode. A replay will be available approximately one hour after the completion of the call by calling toll-free (877) 660-6853 or internationally (201) 612-7415 and using the following replay access codes: 5521 (account number) and 353660 (replay ID number). A replay will also be available on the K&S website at Investor Events . The replay will be available via phone and website for a limited time.

Discussion of Non-GAAP Measures

This press release contains non-GAAP measures as a supplement to the consolidated financial results presented in accordance with GAAP. The Company believes certain non-GAAP measures provide investors with an additional, useful perspective on the Company's performance as seen through the eyes of management. Management uses non-GAAP measures along with GAAP financial results for: analyzing the performance of the Company's businesses; strategic and tactical decision making; and determining compensation. The Company does not consider non-GAAP measures to be a substitute for, or superior to, financial results presented in accordance with GAAP. All of the non-GAAP measures included herein are reconciled to the most directly comparable GAAP results in the following financial statements. These non-GAAP measures may be calculated differently from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on a comprehensive set of accounting rules or principles and some of the adjustments reflect the exclusion of items that are recurring and will be reflected in the Company's GAAP financial results for the foreseeable future.

Exclusions from GAAP Results

The Company excludes the following from its GAAP results in presenting non-GAAP measures:

- Equity-based compensation expenses The Company recognizes the fair value of its equity-based compensation in expense. Equity-based compensation consists of common stock, stock options and performance-based, market-based and time-based restricted stock granted under the Company's equity compensation plans. Equity-based compensation is a non-cash expense that can vary significantly in amount from period to period.

- Other The exclusion of certain other non-GAAP amounts allows for improved comparisons of the Company's results to both prior periods and other companies. The Company excludes the following other items from non-GAAP measures as these items are not reflective of the performance of the Company's ongoing businesses:

 

• Amortization of intangibles
• Restructuring
• Impairment of goodwill
• Switzerland pension plan curtailment
• Gain on extinguishment of debt
• Non-cash interest expense
• Net tax settlement expense (benefit) and other tax adjustments

- Tax Adjustment Non-GAAP measures are tax adjusted using the GAAP tax rate associated with each quarterly period. The tax rate is calculated by dividing each quarter's GAAP tax expense (benefit), adjusted for discrete quarterly items, by the GAAP operating income (loss) for that quarter. Non-GAAP year-to-date measures are calculated by summing the associated quarterly non-GAAP measures, without further tax adjustments.

Non-GAAP Measures

The specific non-GAAP measures included herein are gross profit, gross margin, net income (loss), net margin, and earnings per share ("EPS"). The Company calculates these measures as follows:

--Adjusted Gross Profit and Adjusted Gross Margin K&S non-GAAP adjusted gross profit and adjusted gross margin exclude the effect of equity-based compensation expense recorded within cost of sales.

--AdjustedNet Income (Loss), Adjusted Net Margin and Adjusted EPS K&S non-GAAP adjusted net income (loss) and adjusted EPS exclude equity-based compensation; amortization of intangibles; restructuring; impairment of goodwill; Switzerland pension curtailment plan; gain on extinguishment of debt; non-cash interest expense; net tax settlement expense (benefit) and other tax adjustments; and related tax effects on non-GAAP adjustments.

About Kulicke & Soffa

Kulicke & Soffa (NASDAQ: KLIC) is a global leader in the design and manufacture of semiconductor and LED assembly equipment. As a pioneer in this industry, K&S has provided customers with market leading packaging solutions for decades. In recent years, K&S has expanded its product offerings through strategic acquisitions, adding die and wedge bonders and a broader range of expendable tools to its core ball bonding products. Combined with its extensive expertise in process technology, K&S is well positioned to help customers meet the challenges of assembling the next-generation semiconductor and LED devices. (www.kns.com)

Caution Concerning Forward Looking Statements

In addition to historical statements, this press release contains statements relating to future events and our future results. These statements are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, and include, but are not limited to, statements that relate to increasing, continuing or strengthening demand for our products, and our future growth, revenue, profitability and cash flow. While these forward-looking statements represent our judgments and future expectations concerning our business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to: the risk that customer orders already received may be postponed or canceled, generally without charges; the risk that anticipated customer orders may not materialize; the risk that our suppliers may not be able to meet our demands on a timely basis during periods of historically high demand for our products; the volatility in the demand for semiconductors and our products and services; volatile global economic conditions, which could result in, among other things, sharply lower demand for products containing semiconductors and for the Company's products, and disruption of capital and credit markets; the risk of failure to successfully manage our operations; acts of terrorism and violence;risks, such as changes in trade regulations, currency fluctuations, political instability and war, associated with a substantial foreign customer and supplier base and substantial foreign manufacturing operations;and the factors listed or discussed in Kulicke and Soffa Industries, Inc. 2009 Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission. Kulicke & Soffa Industries, Inc is under no obligation to (and expressly disclaims any obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.

KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share and employee data)
(Unaudited)
		Three months ended								Nine months ended
		June 27,				July 3,				June 27,				July 3,
		2009 *				2010				2009 *				2010
Net revenue:
Equipment		$	37,544			$	202,185			$	78,180			$	450,135
Expendable Tools			14,532				19,069				36,544				53,372
Total net revenue			52,076				221,254				114,724				503,507
Cost of sales:
Equipment			25,612				114,169				54,833				258,780
Expendable Tools			6,795				7,901				18,249				21,398
Total cost of sales			32,407				122,070				73,082				280,178
Gross profit:
Equipment			11,932				88,016				23,347				191,355
Expendable Tools			7,737				11,168				18,295				31,974
Total gross profit			19,669				99,184				41,642				223,329
Operating expenses:
Selling, general and administrative			18,537				31,015				61,534				81,332
Research and development			12,264				14,686				40,922				41,827
Amortization of intangible assets			2,783				2,386				8,311				7,160
Restructuring			567				1,045				9,730				1,650
Impairment of goodwill			-				-				2,709				-
Total operating expenses			34,151				49,132				123,206				131,969
Income (loss) from operations:
Equipment			(16,861	)			46,768				(81,869	)			81,809
Expendable Tools			2,379				3,284				305				9,551
Total income (loss) from operations			(14,482	)			50,052				(81,564	)			91,360
Other income (expense):
Interest income			75				104				1,022				290
Interest expense			(363	)			(385	)			(1,196	)			(1,106	)
Interest expense: non-cash			(1,648	)			(1,768	)			(4,918	)			(5,235	)
Gain on extinguishment of debt			-				-				3,965				-
Income (loss) from continuing operations, before tax			(16,418	)			48,003				(82,691	)			85,309
Benefit for income taxes			(1,156	)			(1,080	)			(13,314	)			(772	)
Income (loss) from continuing operations, net of tax			(15,262	)			49,083				(69,377	)			86,081
Income from discontinued operations, net of tax			-				-				22,727				-
Net income (loss)		$	(15,262	)		$	49,083			$	(46,650	)		$	86,081
Income (loss) per share from continuing operations:
Basic		$	(0.25	)		$	0.69			$	(1.14	)		$	1.22
Diluted		$	(0.25	)		$	0.65			$	(1.14	)		$	1.15
Income per share from discontinued operations:
Basic		$	-			$	-			$	0.37			$	-
Diluted		$	-			$	-			$	0.37			$	-
Net income (loss) per share:
Basic		$	(0.25	)		$	0.69			$	(0.77	)		$	1.22
Diluted		$	(0.25	)		$	0.65			$	(0.77	)		$	1.15
Weighted average shares outstanding:
Basic			61,220				70,131				60,908				69,873
Diluted			61,220				74,960				60,908				74,494
		Three months ended								Nine months ended
		June 27,				July 3,				June 27,				July 3,
Supplemental financial data (continuing operations):		2009				2010				2009				2010
Depreciation and amortization		$	4,893			$	4,336			$	15,608			$	13,258
Capital expenditures		$	1,053			$	1,265			$	4,399			$	3,371
Equity-based compensation expense:
Cost of sales		$	40			$	44			$	39			$	140
Selling, general and administrative			499				1,231				248				3,218
Research and development			237				334				475				1,064
Total equity-based compensation expense		$	776			$	1,609			$	762			$	4,422
										As of
										June 27,				July 3,
										2009				2010
Backlog of orders										$	38,000			$	264,000
Number of employees											2,144				2,953		(1)
* As adjusted for ASC No. 470.20, Debt, Debt With Conversion Options.
(1) - Increase primarily due to manufacturing headcount

KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
			October 3,					July 3,
			2009 *					2010
ASSETS
CURRENT ASSETS
Cash and cash equivalents			$	144,560				$	162,840
Restricted cash				281					226
Accounts and notes receivable, net of allowance for doubtful accounts of $1,378 and $507, respectively				95,779					151,583
Inventories, net				41,489					68,833
Prepaid expenses and other current assets				11,566					13,956
Deferred income taxes				1,786					1,783
TOTAL CURRENT ASSETS				295,461					399,221
Property, plant and equipment, net				36,046					29,715
Goodwill				26,698					26,698
Intangible assets				48,656					41,497
Other assets				5,774					9,347
TOTAL ASSETS			$	412,635				$	506,478
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long term debt			$	48,964				$	-
Accounts payable				39,908					80,326
Accrued expenses and other current liabilities				32,576					38,197
Income taxes payable				1,612					894
TOTAL CURRENT LIABILITIES				123,060					119,417
Long term debt				92,217					96,861
Deferred income taxes				16,282					16,864
Other liabilities				10,273					9,330
TOTAL LIABILITIES				241,832					242,472
SHAREHOLDERS' EQUITY
Common stock, no par value				413,092					420,370
Treasury stock, at cost				(46,356	)				(46,356	)
Accumulated deficit				(197,812	)				(111,731	)
Accumulated other comprehensive income				1,879					1,723
TOTAL SHAREHOLDERS' EQUITY				170,803					264,006
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY			$	412,635				$	506,478
* As adjusted for ASC No. 470.20, Debt, Debt With Conversion Options.

KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
		Three months ended								Nine months ended
		June 27, 2009				July 3, 2010				June 27, 2009				July 3, 2010
Net cash provided by (used in) continuing operations		$	(11,412	)		$	27,658			$	(41,245	)		$	67,977
Net cash used in discontinued operations			(481	)			(582	)			(1,699	)			(1,488	)
Net cash provided by (used in) operating activities		$	(11,893	)		$	27,076			$	(42,944	)		$	66,489
Net cash provided by (used in) investing activities, continued operations			(1,005	)			(1,275	)			(52,894	)			642
Net cash provided by (used in) investing activities, discontinued operations			-				-				149,857				(1,838	)
Net cash provided by (used in) investing activities		$	(1,005	)		$	(1,275	)		$	96,963			$	(1,196	)
Net cash provided by (used in) financing activities, continued operations			51				(47,304	)			(84,304	)			(47,121	)
Effect of exchange rate changes on cash and cash equivalents			(73	)			262				40				108
Changes in cash and cash equivalents		$	(12,920	)		$	(21,241	)		$	(30,245	)		$	18,280
Cash and cash equivalents, beginning of period			127,607				184,081				144,932				144,560
Cash and cash equivalents, end of period		$	114,687			$	162,840			$	114,687			$	162,840
Short-term investments & restricted cash			2,598				226				2,598				226
Total cash, cash equivalents, restricted cash and short-term investments		$	117,285			$	163,066			$	117,285			$	163,066

KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS - SUMMARY
COMPARISON OF GAAP RESULTS TO NON-GAAP MEASURES
(In thousands, except share amounts)
(Unaudited)
		Three months ended				Three months ended			Nine months ended				Nine months ended
		June 27,				July 3,			June 27,				July 3,
		2009 *				2010			2009 *				2010
		(GAAP results)
Net revenue		$	52,076			$	221,254		$	114,724			$	503,507
Gross profit			19,669				99,184			41,642				223,329
Income (loss) from operations			(14,482	)			50,052			(81,564	)			91,360
Income (loss) from continuing operations, net of tax			(15,262	)			49,083			(69,377	)			86,081
Weighted average shares outstanding
Basic			61,220				70,131			60,908				69,873
Diluted			61,220				74,960			60,908				74,494
Income (loss) per share from continuing operations
Basic		$	(0.25	)		$	0.69			(1.14	)		$	1.22
Diluted		$	(0.25	)		$	0.65		$	(1.14	)		$	1.15
		(Non-GAAP measures)
Net revenue		$	52,076			$	221,254		$	114,724			$	503,507
Gross profit			19,709				99,228			41,681				223,469
Income (loss) from operations			(11,802	)			55,092			(59,286	)			104,592
Income (loss) from continuing operations, net of tax			(12,010	)			55,643			(59,533	)			104,050
Weighted average shares outstanding, continuing operations
Basic			61,220				70,131			60,908				69,873
Diluted			61,220				74,960			60,908				74,494
Income (loss) per share from continuing operations
Basic		$	(0.20	)		$	0.79		$	(0.98	)		$	1.48
Diluted		$	(0.20	)		$	0.74		$	(0.98	)		$	1.39
* As adjusted for ASC No. 470.20, Debt, Debt With Conversion Options.

KULICKE & SOFFA INDUSTRIES, INC.
OPERATING RESULTS BY BUSINESS SEGMENT - SUMMARY
COMPARISON OF GAAP RESULTS TO NON-GAAP MEASURES
(In thousands)
(Unaudited)
								Expendable
			Equipment					Tools
			Segment					Segment				Consolidated
Fiscal 2010:
Three months ended July 3, 2010
			(GAAP results)
Net revenue			$	202,185				$	19,069			$	221,254
Gross profit				88,016					11,168				99,184
Income from operations				46,768					3,284				50,052
			(Non-GAAP measures)
Net revenue			$	202,185				$	19,069			$	221,254
Gross profit				88,051					11,177				99,228
Income from operations				50,486					4,606				55,092
Nine months ended July 3, 2010
			(GAAP results)
Net revenue			$	450,135				$	53,372			$	503,507
Gross profit				191,355					31,974				223,329
Income from operations				81,809					9,551				91,360
			(Non-GAAP measures)
Net revenue			$	450,135				$	53,372			$	503,507
Gross profit				191,467					32,002				223,469
Income from operations				91,631					12,961				104,592
Fiscal 2009:
Three months ended June 27, 2009
			(GAAP results)
Net revenue			$	37,544				$	14,532			$	52,076
Gross profit				11,932					7,737				19,669
Income (loss) from operations				(16,861	)				2,379				(14,482	)
			(Non-GAAP measures)
Net revenue			$	37,544				$	14,532			$	52,076
Gross profit				11,962					7,747				19,709
Income (loss) from operations				(15,686	)				3,884				(11,802	)
Nine months ended June 27, 2009
			(GAAP results)
Net revenue			$	78,180				$	36,544			$	114,724
Gross profit				23,347					18,295				41,642
Income (loss) from operations				(81,869	)				305				(81,564	)
			(Non-GAAP measures)
Net revenue			$	78,180				$	36,544			$	114,724
Gross profit				23,412					18,269				41,681
Income (loss) from operations				(66,378	)				7,092				(59,286	)

KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
RECONCILIATION OF GAAP RESULTS TO NON-GAAP MEASURES
(In thousands, except share amounts)
(Unaudited)
		Three months ended							Three months ended							Nine months ended							Nine months ended
		June 27,				% of Revenue			July 3,				% of Revenue			June 27,				% of Revenue			July 3,				% of Revenue
		2009 *							2010							2009 *							2010
Net revenue (GAAP results)		$	52,076						$	221,254						$	114,724						$	503,507
Net revenue (Non-GAAP measures)			52,076							221,254							114,724							503,507
Gross profit (GAAP results)			19,669			37.8	%			99,184			44.8	%			41,642			36.3	%			223,329			44.4	%
- Equity-based compensation expense			40							44							39							140
Gross profit (Non-GAAP measures)			19,709			37.8	%			99,228			44.8	%			41,681			36.3	%			223,469			44.4	%
Income (loss) from operations (GAAP results)			(14,482	)		-27.8	%			50,052			22.6	%			(81,564	)		-71.1	%			91,360			18.1	%
- Amortization of intangibles			2,783							2,386							8,311							7,160
- Restructuring			567							1,045							9,730							1,650
- Impairment of goodwill			-							-							2,709							-
- Equity-based compensation expense			776							1,609							762							4,422
- Switzerland pension plan curtailment			(1,446	)						-							(1,446	)						-
- Tax settlement expense			-							-							2,212							-
Income (loss) from operations (Non-GAAP measures)			(11,802	)		-22.7	%			55,092			24.9	%			(59,286	)		-51.7	%			104,592			20.8	%
Income (loss) from continuing operations, net of tax (GAAP results)			(15,262	)		-29.3	%			49,083			22.2	%			(69,377	)		-60.5	%			86,081			17.1	%
- Total non-GAAP adjustments to income (loss) from continuing operations			2,680							5,040							22,278							13,232
- Gain on extinguishment of debt			-							-							(3,965	)						-
- Non cash interest expense			1,648							1,768							4,918							5,235
- Net tax settlement benefit and other tax adjustments			(1,047	)						-							(13,201	)						-
- Tax effect of non-GAAP adjustments			(29	)						(248	)						(186	)						(498	)
Income (loss) from continuing operations, net of tax (Non-GAAP measures)			(12,010	)		-23.1	%			55,643			25.1	%			(59,533	)		-51.9	%			104,050			20.7	%
Weighted average shares outstanding (GAAP & Non-GAAP)
Basic			61,220							70,131							60,908							69,873
Diluted			61,220							74,960							60,908							74,494
Income (loss) per share from continuing operations (GAAP results)
Basic		$	(0.25	)					$	0.69						$	(1.14	)					$	1.22
Diluted		$	(0.25	)					$	0.65						$	(1.14	)					$	1.15
Adjustments to net income (loss) per share
Basic		$	0.05						$	0.10						$	0.16						$	0.26
Diluted		$	0.05						$	0.09						$	0.16						$	0.24
Income (loss) per share from continuing operations (Non-GAAP measures)
Basic		$	(0.20	)					$	0.79						$	(0.98	)					$	1.48
Diluted		$	(0.20	)					$	0.74						$	(0.98	)					$	1.39
* As adjusted for ASC No. 470.20, Debt, Debt With Conversion Options.

KULICKE & SOFFA INDUSTRIES, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
RECONCILIATION OF GAAP RESULTS TO NON-GAAP MEASURES
(In thousands)
(Unaudited)
									Expendable
		Equipment				% of			Tools				% of
		Segment				Revenue			Segment				Revenue			Consolidated
Fiscal 2010:
Three months ended July 3, 2010
Net revenue (GAAP results)		$	202,185						$	19,069						$	221,254
Net revenue (Non-GAAP measures)			202,185							19,069							221,254
Gross profit (GAAP results)			88,016			43.5	%			11,168			58.6	%			99,184
- Equity-based compensation expense			35							9							44
Gross profit (Non-GAAP measures)			88,051			43.5	%			11,177			58.6	%			99,228
Income from operations (GAAP results)			46,768			23.1	%			3,284			17.2	%			50,052
- Amortization of intangibles			1,814							572							2,386
- Restructuring			626							419							1,045
- Equity-based compensation expense			1,278							331							1,609
Income from operations (Non-GAAP measures)			50,486			25.0	%			4,606			24.2	%			55,092
Nine months ended July 3, 2010
Net revenue (GAAP results)		$	450,135						$	53,372						$	503,507
Net revenue (Non-GAAP measures)			450,135							53,372							503,507
Gross profit (GAAP results)			191,355			42.5	%			31,974			59.9	%			223,329
- Equity-based compensation expense			112							28							140
Gross profit (Non-GAAP measures)			191,467			42.5	%			32,002			60.0	%			223,469
Income from operations (GAAP results)			81,809			18.2	%			9,551			17.9	%			91,360
- Amortization of intangibles			5,442							1,718							7,160
- Restructuring			868							782							1,650
- Equity-based compensation expense			3,512							910							4,422
Income from operations (Non-GAAP measures)			91,631			20.4	%			12,961			24.3	%			104,592
Fiscal 2009:
Three months ended June 27, 2009
Net revenue (GAAP results)		$	37,544						$	14,532						$	52,076
Net revenue (Non-GAAP measures)			37,544							14,532							52,076
Gross profit (GAAP results)			11,932			31.8	%			7,737			53.2	%			19,669
- Equity-based compensation expense			30							10							40
Gross profit (Non-GAAP measures)			11,962			31.9	%			7,747			53.3	%			19,709
Income (loss) from operations (GAAP results)			(16,861	)		-44.9	%			2,379			16.4	%			(14,482	)
- Amortization of intangibles			2,126							657							2,783
- Restructuring			(93	)						660							567
- Equity-based compensation expense			588							188							776
- Switzerland pension plan curtailment			(1,446	)						-							(1,446	)
Income (loss) from operations (Non-GAAP measures)			(15,686	)		-41.8	%			3,884			26.7	%			(11,802	)
Nine months ended June 27, 2009
Net revenue (GAAP results)		$	78,180						$	36,544						$	114,724
Net revenue (Non-GAAP measures)			78,180							36,544							114,724
Gross profit (GAAP results)			23,347			29.9	%			18,295			50.1	%			41,642
- Equity-based compensation expense			65							(26	)						39
Gross profit (Non-GAAP measures)			23,412			29.9	%			18,269			50.0	%			41,681
Income (loss) from operations (GAAP results)			(81,869	)		-104.7	%			305			0.8	%			(81,564	)
- Amortization of intangibles			6,340							1,971							8,311
- Restructuring			7,206							2,524							9,730
- Impairment of goodwill			2,709							-							2,709
- Equity-based compensation expense			682							80							762
- Switzerland pension plan curtailment			(1,446	)						-							(1,446	)
- Tax settlement expense			-							2,212							2,212
Income (loss) from operations (Non-GAAP measures)			(66,378	)		-84.9	%			7,092			19.4	%			(59,286	)

KULICKE & SOFFA INDUSTRIES, INC.
ADJUSTED RETURN ON INVESTED CAPITAL
(In thousands)
(Unaudited)
		Three months ended
		July 3, 2010
Income from operations		$	50,052
Adjustment: Depreciation and amortization (1)			4,336
Adjusted income from operations			54,388
Adjusted income from operations, annualized (4)						$	217,552
Cash, cash equivalents, restricted cash and investments		$	163,066
Adjustment: cash, cash equivalents, restricted cash and investments (2)			(88,066	)
Adjusted cash, cash equivalents and investments						$	75,000
Total assets excluding cash, cash equivalents and investments							343,412
Adjusted total assets							418,412
Total current liabilities		$	119,417
Add: taxes payable (3)			1,552
Adjusted current liabilities							120,969
Adjusted net invested capital						$	297,443
ROIC (4)							73.1	%

(1) Depreciation and amortization are excluded from the ROIC calculation.

(2) Management estimates minimum cash requirement is $75.0 million.

(3) Adjusted current liabilities includes tax liabilities classified as current in prior periods but reclassed to long term liabilities as a result of our adoption of ASC 740.10 during the first quarter of fiscal 2008.

(4) ROIC calculated as adjusted income from operations, annualized through multiplying the current quarter's income from operations by 4, then divided by adjusted net invested capital. Adjusted income from operations is not intended to forecast the Company's future income from operations.

SOURCE: Kulicke & Soffa Industries, Inc.

Kulicke & Soffa Industries, Inc.
Joseph Elgindy
Investor Relations
P: (215) 784-7518
F: (215) 784-6180
jelgindy@kns.com
or
Headgate Partners LLC
Claire E. McAdams
P: (530) 265-9899
F: (530) 265-9699
claire@headgatepartners.com