Kulicke & Soffa Reports Fourth Quarter and Fiscal Year 2013 Results

  Kulicke & Soffa Reports Fourth Quarter and Fiscal Year 2013 Results

Business Wire

SINGAPORE -- November 7, 2013

Kulicke and Soffa Industries, Inc. (NASDAQ: KLIC) (“Kulicke & Soffa”, “K&S” or
the “Company”) today announced results for its fourth quarter and fiscal year
ended September28, 2013.


Quarterly Results
                          Fiscal Q4           Change vs.          Change vs.
                      2013             Fiscal Q4        Fiscal Q3
                                              2012                2013
Net Revenue            $173.6           (35.5)%          23.0%
                          million
Gross Profit           $80.7 million    (34.4)%          22.4%
Gross Margin           46.5%            80 bps           (20) bps
Income from               $34.5 million       (50.9)%             83.1%
Operations
Operating Margin       19.9%            (620) bps        650 bps
Net Income                $29.5 million       (56.1)%             56.4%
Net Margin             17.0%            (800) bps        360 bps
EPS – Diluted          $0.39            (56.7)%          56%
                                                                  

Bruno Guilmart, Kulicke & Soffa's President and Chief Executive Officer, said,
“For the most part, the fourth quarter developed as expected, but was a lot
more dynamic than we anticipated. Demand has rebounded in our wedge bonder
business and remained solid for our ball bonders, especially for our copper
solutions. During the quarter, we ramped production through our flexible and
efficient manufacturing model, and continued to drive overall profitability
and free cash flow generation for the Company.”

Fourth Quarter Fiscal 2013 Key Product Trends

  *Ball bonder equipment net revenue increased 24.5% over the June quarter.
  *80.2% of ball bonder equipment was sold as copper capable.
  *Wedge bonder equipment net revenue increased 95.5% over the June quarter.

Fiscal Year 2013 Financial Highlights

  *Net revenue of $534.9 million.
  *Gross margin of 46.2%.
  *Net income was $59.4 million or $0.78 per share.
  *Cash, cash equivalents and investments were $525.0 million as at September
    28, 2013.

First Quarter Fiscal 2014 Outlook

The Company expects net revenue in the first fiscal quarter of 2014 ending
December 28, 2013 to be approximately $70 million to $80 million.

Looking forward, Bruno Guilmart commented, “Our organization’s collective
expertise continues to allow K&S to optimize performance in periods of both
rapid expansion and contraction. We remain confident as we continue to build
on to our market leading positions within both our equipment and expendable
tools portfolios. As an example, we released several new core products during
the September quarter. Over the next week we plan to ship the first alpha
version of our advanced packaging solution to a key strategic customer for
evaluation. We are excited about this progress and we will keep the market
updated on future developments.”

Earnings Conference Call Details

A conference call to discuss these results will be held today, November 7,
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 investor.kns.com.

A replay will be available from approximately one hour after the completion of
the call through November 14, 2013 by calling toll-free +1-877-660-6853 or
internationally +1-201-612-7415 and using the replay ID number of 421598. A
webcast replay will also be available at investor.kns.com.

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.
(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, 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 Commission. Kulicke and 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 28,  September 29,   September 28,  September
                                                                   29,
                   2013            2012            2013            2012
Net revenue:
Equipment          $  156,479      $  252,785      $  472,567      $ 727,082
Expendable Tools   17,129         16,381         62,371         63,941    
Total net          173,608         269,166         534,938         791,023
revenue
                                                                   
Cost of sales:
Equipment          86,066          139,479         261,270         397,210
Expendable Tools   6,856          6,703          26,723         26,423    
Total cost of      92,922          146,182         287,993         423,633
sales
                                                                   
Gross profit:
Equipment          70,413          113,306         211,297         329,872
Expendable Tools   10,273         9,678          35,648         37,518    
Total gross        80,686         122,984        246,945        367,390   
profit
                                                                   
Operating
expenses:
Selling, general
and                28,072          31,029          108,401         110,966
administrative
Research and       15,377          17,369          61,620          63,446
development
Amortization of
intangible         2,292           2,295           9,175           9,178
assets
Restructuring      401            1,959          1,943          4,574     
Total operating    46,142         52,652         181,139        188,164   
expenses
                                                                   
Income from
operations:
Equipment          30,344          67,046          52,991          165,791
Expendable Tools   4,200          3,286          12,815         13,435    
Total income       34,544          70,332          65,806          179,226
from operations
                                                                   
Other income
(expense):
Interest income    254             182             883             833
Interest expense   (20         )   —               (21         )   (633      )
Interest
expense:           —              (1          )   —              (5,175    )
non-cash
                                                                   
Income from
operations         34,778          70,513          66,668          174,251
before income
taxes
Provision for      5,247          3,231          7,310          13,671    
income taxes
Net income         $  29,531      $  67,282      $  59,358      $ 160,580 
                                                                   
Net income per
share:
Basic              $  0.39        $  0.91        $  0.79        $ 2.17    
Diluted            $  0.39        $  0.89        $  0.78        $ 2.13    
                                                                   
Weighted average
shares
outstanding:
Basic              75,279          74,116          75,132          73,887
Diluted            76,565          75,942          76,190          75,502

                                                
                   Three months ended              Twelve months ended
                   September 28,  September 29,   September 28,  September
                                                                   29,
Supplemental       2013            2012            2013            2012
financial data:
Depreciation and   $  4,187        $  4,615        $  18,489       $  17,265
amortization
Capital            11,215          1,757           17,172          6,902
expenditures
Equity-based
compensation
expense:
Cost of sales      20              86              295             312
Selling, general
and                2,049           1,575           8,457           6,602
administrative
Research and       480            461            1,918          1,777     
development
Total
equity-based       $  2,549       $  2,122       $  10,670      $  8,691  
compensation
expense
                                                                             
                                                                             
                   As of
                   September 28,   September 29,
                   2013            2012
Backlog of         $  52,100       $  90,000
orders
Number of          2,164           2,936
employees

                                               
KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
                                                 
                                                 As of
                                                 September 28,  September 29,
                                                 2013            2012
ASSETS
CURRENT ASSETS
Cash and cash equivalents                        $  521,788      $  440,244
Short-term investments                           3,252           —
Accounts and notes receivable, net of
allowance for doubtful accounts of $504 and      162,714         188,986
$937 respectively
Inventories, net                                 38,135          58,994
Prepaid expenses and other current assets        24,012          21,577
Deferred income taxes                            4,487          3,515       
TOTAL CURRENT ASSETS                             754,388         713,316
                                                                 
Property, plant and equipment, net               47,541          28,441
Goodwill                                         41,546          41,546
Intangible assets                                11,209          20,387
Other assets                                     8,310          11,919      
TOTAL ASSETS                                     $  862,994     $  815,609  
                                                                 
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable                                 $  37,030       $  57,231
Accrued expenses and other current liabilities   38,868          57,946
Income taxes payable                             1,504          8,192       
TOTAL CURRENT LIABILITIES                        77,402          123,369
                                                                 
Built-to-suit liability                          19,396          —
Deferred income taxes                            40,709          37,875
Other liabilities                                8,822          10,698      
TOTAL LIABILITIES                                146,329        171,942     
                                                                 
SHAREHOLDERS' EQUITY
Common stock, no par value                       467,525         455,122
Treasury stock, at cost                          (46,356     )   (46,356     )
Accumulated income                               291,878         232,520
Accumulated other comprehensive income           3,618          2,381       
TOTAL SHAREHOLDERS' EQUITY                       $  716,665     $  643,667  
                                                                 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY       $  862,994     $  815,609  

                                              
KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
                                                 
                 Three months ended              Twelve months ended
                 September 28,  September 29,   September 28,  September 29,
                 2013            2012            2013            2012
Net cash
provided by      $  26,644       $  59,321       $  94,824       $  183,969
operations
Net cash used
in               —              (29         )   —              (1,498      )
discontinued
operations
Net cash
provided by      26,644          59,292          94,824          182,471
operating
activities
Net cash used
in investing
activities,      (14,467     )   (1,757      )   (15,114     )   (15,386     )
continuing
operations
Net cash
provided by
(used in)
financing        865             1,834           1,733           (105,138    )
activities,
continuing
operations
Effect of
exchange rate
changes on       253            178            101            109         
cash and cash
equivalents
Changes in
cash and cash    13,295          59,547          81,544          62,056
equivalents
Cash and cash
equivalents,     508,493        380,697        440,244        378,188     
beginning of
period
Cash and cash
equivalents,     $  521,788     $  440,244     $  521,788     $  440,244  
end of period
                                                                 
Short-term
investments &    3,252          —              3,252          —           
restricted
cash
Total cash,
cash
equivalents,
restricted       $  525,040     $  440,244     $  525,040     $  440,244  
cash and
short-term
investments

Contact:

Kulicke & Soffa
Joseph Elgindy
Investor Relations & Strategic Planning
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