Published:
Kulicke & Soffa Announces First Fiscal Quarter Results
A Conference Call to Discuss These Results Will be Held Today Beginning at 9:00 AM EST. Interested Participants May Call 877-407-8037 for the Teleconference or Log on to http://www.kns.com/investors/events for Listen-Only Mode.
Kulicke & Soffa Industries, Inc. (K&S)
(NASDAQ: KLIC) today announced financial results for its first fiscal
quarter ended December 31, 2005.
Net revenue for the first fiscal quarter ended December 31, 2005 was $228.1
million, compared to $116.3 million in the comparable year-ago quarter.
This revenue growth was driven by the Company's equipment segment, which
was up 42% sequentially and 311% from a year ago, due to strong demand
across a broad customer base for its new Maxum Ultra wire bonder.
Diluted earnings per share during the first fiscal quarter were $0.38,
compared to a loss per share of $0.14 in the year-ago quarter and diluted
earnings per share of $0.19 in the quarter ended September 30, 2005. The
financial results for the three months ended December 31, 2005 include
stock-based compensation expense from stock options of $1.5 million, or
$0.02 per diluted share. As previously communicated, the Company began
recording stock-based compensation expense during the first fiscal quarter.
Stock-based compensation expense was not recorded in any prior period.
Also, during the quarter the Company sold certain intellectual property and
distribution rights to an off-shore subsidiary. This sale, along with
increased earnings in the U.S. resulted in incremental state income taxes
and alternative minimum taxes of $2.6 million during the quarter ended
December 31, 2005 that are not expected to reoccur through the rest of this
fiscal year.
Scott Kulicke, chairman and chief executive officer of K&S, commented on
the December quarter, "Demand for all of our products was strong in the
December quarter, but especially for our wire bonders. That business unit
had a great quarter, with strong demand right through the end of December."
First Quarter Review and Highlights
Corporate Strategy
-- As separately announced today, the Company has entered into definitive
agreements to sell its wafer test assets to SV Probe PTE, Ltd. and its
package test assets to Investcorp Technology Ventures II, L.P., allowing
the Company to narrow its focus on its core businesses -- semiconductor
assembly equipment and materials.
Technology & Manufacturing
-- The K&S Maxum Ultra is typically exceeding the 10% productivity gains
that were targeted for this model. The throughput is measured in "packages
wire bonded per hour," which provides customers a direct measurement of the
improved factory output of the Maxum Ultra, relative to its competition.
-- The new Maxum Elite model (replacing the K&S Nutek) was adopted by
several customers as their new "bonder of record." The increased
productivity and the new features associated with this model provide
customers leading-edge cost of ownership and competitive advantages in the
assembly of low lead count packages.
-- Several customers are adopting the new AT Premier wafer bumper for
assembly of non-wire bonded packages. This new K&S product mechanically
adds gold bumps to semiconductor wafers, which is often more cost effective
than traditional plating methods and represents an opportunity for
incremental growth for K&S.
Key Product Trends
-- The customer transition to the new Maxum Ultra model is more rapid
than planned. The Maxum Ultra model accounted for 25% of the wire bonders
shipped by the Company during the September quarter and 63% of the wire
bonders shipped during the December quarter. The percentage of Maxum Ultra
shipments will rise again in the March quarter.
-- Wire unit volumes for the first quarter grew 38% over the same quarter
of the previous year.
Financial Review
-- Sales of $228.1 million are the highest since the March 2004 quarter.
Revenue grew by $46.1 million or 25.4% from the prior quarter.
-- Gross Profit Margin improved to 31.1% in the first quarter from 28.4%
in the prior quarter, primarily from the significant sales increase in the
equipment segment.
-- Additional information regarding the sale of the Company's Test
business segment will be provided in our 10-Q filing.
Business Summary
Mr. Kulicke concluded, "Including revenues from our Test segment, our
guidance for the March quarter is for revenue to be $180 million, plus or
minus about 5%. Excluding revenues from our Test segment, our revenue
expectations for the March quarter are expected to be $158 million, plus or
minus about 5%."
About Kulicke & Soffa
Kulicke & Soffa (NASDAQ: KLIC) is the world's leading supplier of
semiconductor wire bonding assembly equipment. We believe K&S is the only
major supplier to the semiconductor assembly industry that provides
customers with semiconductor assembly equipment along with the
complementing packaging materials that contact the surface of the
customer's semiconductor devices. The ability to provide these assembly
related products is unique to Kulicke & Soffa, and allows us to develop
system solutions to the new technology challenges inherent in assembling
and packaging next-generation semiconductor devices. Kulicke & Soffa's web
site address is http://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 our future revenue, operating
expenses, profitability, cash flows, introduction and customer adoption of
new products, sale of the Company's test assets and performance, and
projected continued demand for our products. 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 of
failure to successfully manage our operations; the risk that anticipated
orders may not materialize or that orders received may be postponed or
canceled, generally without charges; the risk that anticipated sales of the
test businesses will not be achieved; the volatility in the demand for
semiconductors and our products and services; the risk that we may not be
able to develop and manufacture new products and product enhancements on a
timely and cost effective basis; acts of terrorism and violence; overall
global economic conditions; 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; potential instability in foreign capital markets;
and the factors listed or discussed in Kulicke and Soffa Industries, Inc.
2005 Annual report on Form 10-K and our other filings with the Securities
and Exchange Commission. Kulicke & Soffa Industries 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 STATEMENT OF OPERATIONS
(In thousands, except per share and employee data)
(Unaudited)
Three months ended
December 31,
---------
2004 2005
--------- ---------
Net revenue $ 116,321 $ 228,100
Cost of sales 89,943 157,223
--------- ---------
Gross profit 26,378 70,877
--------- ---------
Selling, general and administrative 22,073 27,933
Research and development, net 8,878 12,179
Gain on sale of assets (1) (1,875) -
Amortization of intangible assets 2,194 -
--------- ---------
Operating expense 31,270 40,112
--------- ---------
Income (loss) from operations (4,892) 30,765
Interest income 449 712
Interest expense (846) (958)
--------- ---------
Income (loss) before income tax (5,289) 30,519
Provision for income taxes 1,902 5,218
--------- ---------
Net Income (loss) $ (7,191) $ 25,301
========= =========
Net income (loss) per share:
Basic $ (0.14) $ 0.49
Diluted $ (0.14) $ 0.38
Weighted average shares outstanding:
Basic 51,237 52,044
Diluted 51,237 68,239
Stock-based compensation expense
included in amounts above:
Cost of sales $ - $ 142
Selling, general and administrative - 1,017
Research and development, net - 341
--------- ---------
Total stock-based compensation expense $ - $ 1,500
========= =========
Three months ended
December 31,
---------
Additional financial data: 2004 2005
--------- ---------
Depreciation and amortization $ 7,012 $ 4,173
Capital expenditures $ 2,978 $ 2,965
Backlog of orders $ 58,000 $ 73,000
Number of employees 3,236 $ 3,512
Note: (1) The Gain on sale of assets is mainly comprised of a gain on the
sale of land and building in Gilbert, Arizona of $1,497
thousand.
KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEET
(In thousands)
(Unaudited)
September 30, December 31,
2005 2005
--------- ---------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 79,455 $ 84,320
Restricted cash 1,381 10,255
Short-term investments 14,533 7,222
Accounts and notes receivable
(less allowance for doubtful accounts:
9/30/05 - $3,257; 12/31/05 - $3,102) 143,575 179,520
Inventories, net 54,744 62,926
Prepaid expenses and other current assets 10,267 14,117
Deferred income taxes 1,605 1,567
--------- ---------
TOTAL CURRENT ASSETS 305,560 359,927
Property, plant and equipment, net 45,132 44,372
Goodwill 29,684 29,684
Other assets 6,120 5,835
--------- ---------
TOTAL ASSETS $ 386,496 $ 439,818
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Current portion of long term debt $ 10,119 $ 9,970
Accounts payable 59,448 80,523
Accrued expenses 32,748 32,018
Income taxes payable 17,196 20,615
--------- ---------
TOTAL CURRENT LIABILITIES 119,511 143,126
Long term debt 270,000 270,000
Other liabilities 6,389 6,610
Deferred taxes 22,344 23,207
--------- ---------
TOTAL LIABILITIES 418,244 442,943
--------- ---------
Commitments and contingencies - -
SHAREHOLDERS' EQUITY (DEFICIT)
Common stock, without par value 218,426 221,305
Accumulated deficit (243,994) (218,692)
Accumulated other comprehensive loss (6,180) (5,738)
--------- ---------
TOTAL SHAREHOLDERS' EQUITY (DEFICIT) (31,748) (3,125)
--------- ---------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY (DEFICIT) $ 386,496 $ 439,818
========= =========
KULICKE & SOFFA INDUSTRIES, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
(In thousands)
(Unaudited)
Fiscal 2006:
Packaging
Three months ended Equipment Materials Test
December 31, 2005: (1) Segment Segment Segment Consolidated
-------- -------- -------- --------
Net revenue $120,672 $ 83,960 $ 23,468 $228,100
Cost of sales 68,760 70,486 17,977 157,223
-------- -------- -------- --------
Gross profit 51,912 13,474 5,491 70,877
Operating costs 20,351 7,011 12,750 40,112
-------- -------- -------- --------
Income (loss) from operations $ 31,561 $ 6,463 $ (7,259) $ 30,765
======== ======== ======== ========
Fiscal 2005:
Packaging
Three months ended Equipment Materials Test
December 31, 2004: (1) Segment Segment Segment Consolidated
-------- -------- -------- --------
Net revenue $ 29,349 $ 64,018 $ 22,954 $116,321
Cost of sales 17,326 51,252 21,365 89,943
-------- -------- -------- --------
Gross profit 12,023 12,766 1,589 26,378
Operating costs 13,613 7,372 12,160 33,145
Gain on sale of assets (2) (378) - (1,497) (1,875)
-------- -------- -------- --------
Income (loss) from operations $ (1,212) $ 5,394 $ (9,074) $ (4,892)
======== ======== ======== ========
Notes: (1) Beginning with the three months ended December 31, 2005, the
company is no longer including "Corporate and Other" as a
business segment. Operating costs previously allocated to
this segment, which primarily consisted of general corporate
expenses, have been allocated to the company's three remaining
business segments. The business segments information for the
three months ended December 31, 2004 have also been modified
to reflect this change.
(2) The Gain on sale of assets is mainly comprised of a gain on
the sale of land and building in Gilbert, Arizona of $1,497
thousand.
Distributed by Market Wire
Copyright © 2008, MarketWire
Copyright © 2008, NewsBlaze,
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