Kulicke & Soffa Industries, Inc. (NASDAQ: KLIC) ("K&S" or the "Company") today announced results for its fourth quarter and fiscal year ended September 29, 2012.

Quarterly Results
    Change vs.   Change vs.
    Fiscal Q4 2012   Fiscal Q4 2011   Fiscal Q3 2012
Net Revenue   $269.2 million   49.2%   5.3%
Gross Profit $123.0 million 48.6% 0.4%
Gross Margin   45.7%   (20) bps   (220) bps
Income from Operations $70.3 million 210.0% (7.8%)
Operating Margin   26.1%   1,350 bps   (380) bps
Net Income $67.3 million 3,418.9% (1.3%)
Net Margin   25.0%   2,390 bps   (170) bps
EPS - Diluted   $0.89   2,866.7%   (1.1%)
 

Bruno Guilmart, Kulicke & Soffa's President and Chief Executive Officer, said, "The fourth quarter ended a very strong year for K&S with results at the high-end of our guidance. We are succeeding in a challenging market due to our multi-segment leadership, flexible manufacturing strategy, R&D strength, free cash flow generation and our improving, debt-free balance sheet. We were able to achieve record annual net income of $160.6 million due to the operating leverage we have created in our business combined with a favorable product mix."

Fourth Quarter Fiscal 2012 Key Product Trends

  • Ball bonder equipment net revenue increased 7.0% over the June quarter.
  • 84.5% of ball bonder equipment was sold as copper capable bonders.
  • Wedge bonder equipment net revenue increased 20.8% from the June quarter.

Fiscal Year 2012 Financial Highlights

  • Net revenue of $791.0 million.
  • Gross margin of 46.4%.
  • Net income of $160.6 million or $2.13 per share.
  • Total cash and short-term investments were $440.2 million on September 29, 2012, a $59.5 million increase from the prior quarter ended June 30, 2012.

First Quarter Fiscal Year 2013 Outlook

The Company expects net revenue in the typically seasonally slower fiscal first quarter of 2013 ending December 29, 2012, to be approximately $95 million to $115 million.

Looking forward, Bruno Guilmart commented, "We are confident in the near and long-term prospects for our business. Structural improvements we previously implemented give us an added advantage in navigating periods of fluctuating demand. These improvements include our corporate-wide cost containment program and our now debt-free balance sheet. We also continue to benefit from our flexible manufacturing strategy and strong product offerings. In addition to maintaining a disciplined operations strategy, we are pursuing opportunities that will position us for growth."

Earnings Conference Call Details

A conference call to discuss these results will be held today, November 8, 2012, 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 www.kns.com/investors/events.

A replay will be available from approximately one hour after the completion of the call through November 15, 2012 by calling toll-free +1-877-660-6853 or internationally +1-201-612-7415 and using the replay ID number of 401769. A webcast replay will also be available at www.kns.com/investors/events.

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 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, our improving balance sheet, 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. 2011 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   Twelve months ended
September 29,   October 1, September 29,   October 1,
  2012     2011     2012     2011  
 
Net revenue:
Equipment $ 252,785 $ 161,225 $ 727,082 $ 759,331
Expendable Tools   16,381       19,146     63,941     71,070  
Total net revenue 269,166 180,371 791,023 830,401
 
Cost of sales:
Equipment 139,479 89,350 397,210 412,914
Expendable Tools   6,703     8,275     26,423     29,578  
Total cost of sales 146,182 97,625 423,633 442,492
 
Gross profit:
Equipment 113,306 71,875 329,872 346,417
Expendable Tools   9,678     10,871     37,518     41,492  
Total gross profit   122,984     82,746     367,390     387,909  
 
Operating expenses:
Selling, general and administrative 31,029 40,471 110,966 138,273
Research and development 17,369 16,821 63,446 65,135
Amortization of intangible assets 2,295 2,386 9,178 9,549
Restructuring   1,959     377     4,574     4,892  
Total operating expenses   52,652     60,055     188,164     217,849  
 
 
Income from operations:
Equipment 67,046 18,908 165,791 156,786
Expendable Tools   3,286     3,783     13,435     13,274  
Total income from operations 70,332 22,691 179,226 170,060
 
Other income (expense):
Interest income 182 202 833 648
Interest expense - (241 ) (633 ) (965 )
Interest expense: non-cash   (1 )   (1,886 )   (5,175 )   (7,315 )
 
Income from operations before income taxes 70,513 20,766 174,251 162,428
 
Provision (benefit) for income taxes 3,231 18,854 13,671 34,818
       
Net income $ 67,282   $ 1,912   $ 160,580   $ 127,610  
 
Net income per share:
Basic $ 0.91   $ 0.03   $ 2.17   $ 1.77  
Diluted $ 0.89   $ 0.03   $ 2.13   $ 1.73  
 
Weighted average shares outstanding:
Basic 74,116 72,688 73,887 71,820
Diluted 75,942 74,184 75,502 73,341
 
Three months ended Twelve months ended
September 29, October 1, September 29, October 1,
Supplemental financial data:   2012     2011     2012     2011  
 
Depreciation and amortization $ 4,615 $ 4,487 $ 17,265 $ 17,761
 
Capital expenditures $ 1,757 $ 1,873 $ 6,902 $ 7,688
 
Equity-based compensation expense:
Cost of sales $ 86 $ 54 $ 312 $ 213
Selling, general and administrative 1,575 887 6,602 5,671
Research and development   461     358     1,777     1,328  
Total equity-based compensation expense $ 2,122   $ 1,299   $ 8,691   $ 7,212  
 
As of
September 29, October 1,
  2012     2011  
 
Backlog of orders $ 90,000 $ 103,000
 
Number of employees 2,936 2,866
 
KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
  September 29,   October 1,
  2012     2011  
ASSETS
 
CURRENT ASSETS
Cash and cash equivalents $ 440,244 $ 378,188
Short-term investments - 6,364

Accounts and notes receivable, net of allowance for doubtful accounts of $937 and $2,194, respectively

188,986 138,649
Inventories, net 58,994 73,092
Prepaid expenses and other current assets 21,577 21,897
Deferred income taxes   3,515     1,651  
 
TOTAL CURRENT ASSETS 713,316 619,841
 
Property, plant and equipment, net 28,441 26,501
Goodwill 41,546 41,546
Intangible assets 20,387 29,565
Other assets   11,919     10,938  
 
TOTAL ASSETS $ 815,609   $ 728,391  
 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
CURRENT LIABILITIES
Current portion of long term debt $ - $ 105,224
Accounts payable 57,231 36,321
Accrued expenses and other current liabilities 57,946 43,528
Earnout agreement payable - 14,848
Income taxes payable   8,192     14,261  
 
TOTAL CURRENT LIABILITIES 123,369 214,182
 
Deferred income taxes 37,875 32,065
Other liabilities   10,698     12,267  
 
TOTAL LIABILITIES   171,942     258,514  
 
SHAREHOLDERS' EQUITY
Common stock, no par value 455,122 441,749
Treasury stock, at cost (46,356 ) (46,356 )
Accumulated income 232,520 71,940
Accumulated other comprehensive income   2,381     2,544  
 
TOTAL SHAREHOLDERS' EQUITY   643,667     469,877  
 

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

 $ 815,609   $ 728,391  
 
KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
       
Three months ended Twelve months ended

September 29, 2012

October 1, 2011

September 29, 2012

October 1, 2011

 
Net cash provided by operating activities $ 59,321 $ 50,169 $ 183,969 $ 202,257
Net cash used in discontinued operations   (29 )     (314 )   (1,498 )     (1,861 )
Net cash provided by operating activities $ 59,292 $ 49,855 $ 182,471 $ 200,396
 
Net cash used in investing activities, continuing operations $ (1,757 ) $ (2,049 ) $ (15,386 ) $ (11,106 )
 
Net cash provided by (used in) financing activities 1,834 460 (105,138 ) 9,296
Effect of exchange rate on cash and cash equivalents   178       640     109       1,490  
Changes in cash and cash equivalents $ 59,547 $ 48,906 $ 62,056 $ 200,076
Cash and cash equivalents, beginning of period   380,697       329,282     378,188       178,112  
Cash and cash equivalents, end of period $ 440,244   $ 378,188   $ 440,244   $ 378,188  
 
Short-term investments & restricted cash   -       6,364     -       6,364  
Total cash, cash equivalents, restricted cash and short-term investments $ 440,244     $ 384,552   $ 440,244     $ 384,552  

Kulicke & Soffa Industries, Inc.
Joseph Elgindy
Investor Relations
P: +1-215-784-7518
F: +1-215-784-6180
jelgindy@kns.com
or
Global IR Partners
David Pasquale
P: +1-914-337-8801
klic@globalirpartners.com