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Kulicke & Soffa Reports First Quarter 2013 Results

SINGAPORE--(BUSINESS WIRE)-- Kulicke and Soffa Industries, Inc. (NASDAQ: KLIC) ("Kulicke & Soffa", "K&S" or the "Company") today announced results for its first fiscal quarter ended December 29, 2012.

Quarterly Results

Fiscal Q1 2013

    Change vs.

Fiscal Q1 2012

    Change vs.

Fiscal Q4 2012

Net Revenue     $114.0 million     (5.0%)     (57.6%)
Gross Profit     $51.5 million     (6.8%)     (58.1%)
Gross Margin     45.2%     (90) bps     (50) bps
Income from Operations     $4.2 million     (66.0%)     (94.0%)
Operating Margin     3.7%     (660) bps     (2,240) bps
Net Income     $3.6 million     (57.6%)     (94.6%)
Net Margin     3.2%     (390) bps     (2,180) bps
EPS — Diluted     $0.05     (54.5%)     (94.4%)

Bruno Guilmart, Kulicke & Soffa's President and Chief Executive Officer, said, "The first fiscal quarter's revenue came in at the higher end of our guidance range. The pullback from the prior quarter reflects the high degree of seasonality in our business, with the December quarter traditionally the weakest of the fiscal year. We planned for the decline and took appropriate actions at the beginning of the quarter to accelerate our cost- containment programs. As a result, we reduced our operating expenses by 10% compared to the prior quarter, further strengthened our balance sheet and maintained a strong gross margin."

First Quarter Fiscal 2013 Key Product Trends

  • Ball bonder equipment net revenue decreased 64.5% over the September quarter.
  • 74.8% of ball bonder equipment was sold as copper capable bonders.
  • Wedge bonder equipment net revenue decreased 23% from the September quarter.

First Quarter Fiscal 2013 Financial Highlights

  • Net revenue of $114.0 million.
  • Gross margin of 45.2%.
  • Net income was $3.6 million or $0.05 per share.
    • Net income was reduced by $1.8 million of adjustments related to the Company's RISC (Research Incentive Scheme for Companies) grant.
    • Without this item net income would have been $5.4 million or $0.07 per share.
  • Total cash and short-term investments were $494.2 million on December 29, 2012, a $53.9 million increase from the prior quarter ended September 29, 2012.

Second Quarter Fiscal Year 2013 Outlook

The Company expects net revenue in the second fiscal quarter of 2013 ending March 30, 2013 to be approximately $90 million to $100 million.

Looking forward, Bruno Guilmart commented, "We expect our business to improve as we move through the fiscal year based on normal market seasonality combined with the ongoing copper transition. In general, we normally gain increased visibility from customers after the Chinese New Year Holiday. We remain confident in our long-term business prospects given the strength of our existing equipment portfolio and development pipeline, our market leadership positions, and our strong balance sheet."

Earnings Conference Call Details

A conference call to discuss these results will be held today, January 29, 2013, beginning at 8:00 am (EST). To access the conference call, interested parties may call +1-877-407-8037 or internationally +1-201-689-8037. The call will also be available by live webcast at

A replay will be available from approximately one hour after the completion of the call through February 5, 2013 by calling toll-free +1-877-660-6853 or internationally +1-201-612-7415 and using the replay ID number of 407421. A webcast replay will also be available at

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 wedge bonding 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. (

Caution Concerning Results and 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 our future revenue, sustained, increasing, continuing or strengthening demand for our products, the continuing transition from gold to copper wire bonding, replacement demand, our research and development efforts, our ability to identify and realize new growth opportunities and our ability to control costs. 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; the volatility in the demand for semiconductors and our products and services; a slowdown of transition from gold to copper wire bonding by our customers and the industry, 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, which may be associated with a substantial non-U.S. customer and supplier base and substantial non-U.S. manufacturing operations; and the factors listed or discussed in Kulicke and Soffa Industries, Inc. 2012 Annual Report on Form 10-K and our other filings with the Securities and Exchange CommissionKulicke & 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.

(In thousands, except per share and employee data)
    Three months ended
    December 29,   December 31,
      2012       2011  
Net revenue:          
Equipment   $ 99,902     $ 106,149  
Expendable Tools     14,137       13,875  
Total net revenue     114,039       120,024  
Cost of sales:          
Equipment     56,432       59,004  
Expendable Tools     6,082       5,744  
Total cost of sales     62,514       64,748  
Gross profit:          
Equipment     43,470       47,145  
Expendable Tools     8,055       8,131  
Total gross profit     51,525       55,276  
Operating expenses:          
Selling, general and administrative     26,030       25,240  
Research and development     18,253       14,148  
Amortization of intangible assets     2,293       2,295  
Restructuring     744       1,217  
Total operating expenses     47,320       42,900  
Income from operations:          
Equipment     1,745       9,877  
Expendable Tools     2,460       2,499  
Total income from operations     4,205       12,376  
Other income (expense):          
Interest income     174       260  
Interest expense     -       (242 )
Interest expense: non-cash     -       (1,910 )
Income from operations before income taxes     4,379       10,484  
Provision for income taxes     775       1,977  
Net income   $ 3,604     $ 8,507  
Net income per share:          
Basic   $ 0.05     $ 0.12  
Diluted   $ 0.05     $ 0.11  
Weighted average shares outstanding:          
Basic     74,852       73,540  
Diluted     76,209       74,628  
    Three months ended
    December 29,   December 31,
Supplemental financial data:     2012       2011  
Depreciation and amortization   $ 4,802     $ 4,258  
Capital expenditures   $ 1,616     $ 1,498  
Equity-based compensation expense:          
Cost of sales   $ 148     $ 85  
Selling, general and administrative     2,326       1,611  
Research and development     727       403  
Total equity-based compensation expense   $ 3,201     $ 2,099  
    As of
    December 29,   December 31,
      2012       2011  
Backlog of orders   $ 71,000     $ 88,000  
Number of employees     2,609       2,735  
(In thousands)
    December 29,   September 29,
      2012       2012  
Cash and cash equivalents   $ 494,170     $ 440,244  
Restricted cash     2,900       -  

Accounts and notes receivable, net of allowance for doubtful accounts of $1,019 and $937, respectively

    98,715       188,986  
Inventories, net     54,328       58,994  
Prepaid expenses and other current assets     16,018       21,577  
Deferred income taxes     3,522       3,515  
TOTAL CURRENT ASSETS     669,653       713,316  
Property, plant and equipment, net     28,781       28,441  
Goodwill     41,546       41,546  
Intangible assets     18,092       20,387  
Other assets     11,416       11,919  
TOTAL ASSETS   $ 769,488     $ 815,609  
Accounts payable   $ 20,305     $ 57,231  
Accrued expenses and other current liabilities     42,040       57,946  
Income taxes payable     6,817       8,192  
TOTAL CURRENT LIABILITIES     69,162       123,369  
Deferred income taxes     38,007       37,875  
Other liabilities     10,994       10,698  
TOTAL LIABILITIES     118,163       171,942  
Common stock, no par value     458,482       455,122  
Treasury stock, at cost     (46,356 )     (46,356 )
Accumulated income     236,124       232,520  
Accumulated other comprehensive income     3,075       2,381  
TOTAL SHAREHOLDERS' EQUITY     651,325       643,667  




  $ 769,488     $ 815,609  
(In thousands)
    Three months ended
    December 29, 2012   December 31, 2011
Net cash provided by operations   $ 58,494     $ 34,324  
Net cash used in discontinued operations     -       (486 )
Net cash provided by operating activities   $ 58,494     $ 33,838  
Net cash used in investing activities     (4,516 )     (9,982 )
Net cash provided by financing activities     159       1,576  
Effect of exchange rate changes on cash and cash equivalents     (211 )     141  
Changes in cash and cash equivalents   $ 53,926     $ 25,573  
Cash and cash equivalents, beginning of period     440,244       378,188  
Cash and cash equivalents, end of period   $ 494,170     $ 403,761  
Total cash, cash equivalents and short-term investments   $ 494,170     $ 403,761  


Kulicke & Soffa Industries, Inc.
Joseph Elgindy
Investor Relations & Strategic Planning
P: +1-215-784-7518
F: +1-215-784-6180
Global IR Partners
David Pasquale
P: +1-914-337-8801

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