Kulicke & Soffa Reports Fourth Quarter and Fiscal Year 2012 Results

Kulicke & Soffa Reports Fourth Quarter and Fiscal Year 2012 Results

SINGAPORE--(BUSINESS WIRE)-- Kulicke & Soffa Industries, Inc. (NAS: 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 (NAS: 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