KULICKE & SOFFA INDUSTRIES INC
0000056978
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Singapore
0000056978
2024-05-01
2024-05-01
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2024-05-01
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________________________
FORM
8-K
____________________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported):
May 1, 2024
____________________________________________________
KULICKE AND SOFFA INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
____________________________________________________
Pennsylvania 000-00121 23-1498399
(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
23A Serangoon North Avenue 5
,
#01-01
,
Singapore
554369
1005 Virginia Dr.
,
Fort Washington
,
PA
19034
(Address of Principal Executive Offices and Zip Code)
Registrant's telephone number, including area code: (
215
)
784-6000
N/A
(Former Name or Former Address, if Changed Since Last Report)
____________________________________________________
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (
see
General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, Without Par Value KLIC The Nasdaq Global Market
Indicate by check mark whether the registrant is an emerging growth company as
defined in Rule 405 of the Securities Act of 1933 ((s)230.405 of this chapter)
or Rule 12b-2 of the Securities Exchange Act of 1934 ((s)240.12b-2 of this
chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has
elected not to use the extended transition period for complying with any new
or revised financial accounting standards provided pursuant to Section 13(a)
of the Exchange Act.
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Item 2.02 Results of Operations and Financial Condition.
On May 1, 2024, Kulicke and Soffa Industries, Inc. (the "Company") issued a
press release with respect to its financial results for its second fiscal
quarter ended March 30, 2024. A copy of this press release is furnished as
Exhibit 99.1 to this report, and is incorporated by reference into this Item
2.02 as if fully set forth herein.
The information in this report, furnished under "Item 2.02 Results of
Operations and Financial Condition," shall not be deemed "filed" for purposes
of Section 18 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), nor shall it be deemed incorporated by reference in any
filing under the Securities Act of 1933, as amended, or the Exchange Act,
except as shall be expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
99.1 Press Release dated May 1, 2024
104 Inline XBRL for the cover page of this Current Report on Form 8K.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
KULICKE AND SOFFA INDUSTRIES, INC.
Date: May 1, 2024 By: /s/ LESTER WONG
Name: Lester Wong
Title: Executive Vice President and Chief Financial Officer
(principal financial officer and principal accounting officer)
Exhibit 99.1
Kulicke & Soffa Pte. Ltd.
23A Serangoon North Ave 5
Singapore 554369
+65 6880-9600 main
Co. Regn. No. 199902120H
Kulicke and Soffa Industries, Inc.
1005 Virginia Drive
Fort Washington, PA 19034 USA
+1-215-784-6000 main
www.kns.com
Kulicke & Soffa Reports Second Quarter 2024 Results
Focuses on Operational Efficiency; Increases Repurchase Activity
Singapore - May 1, 2024
-
Kulicke and Soffa Industries, Inc.
(NASDAQ: KLIC) ("Kulicke & Soffa," "K&S," "our," or the "Company"), today
announced financial results of its second fiscal quarter ended March 30, 2024.
The Company reported second quarter net revenue of $172.1 million, net loss of
$102.7 million, representing EPS of $(1.83) per fully diluted share, and
non-GAAP net loss of $53.2 million, representing non-GAAP EPS of $(0.95) per
fully diluted share.
As announced on March 11, 2024, the Company had anticipated pre-tax charges,
including impairments, relating to the cancellation of Project W (the
"Project"), to be in the range of $110 million and $130 million (the "Expected
Range") and to be incurred primarily in the second fiscal quarter 2024. Based
on the actual second fiscal quarter 2024 financial results, the pre-tax
charges, including impairments, were below the Expected Range at $105.5
million.
Quarterly Results - U.S. GAAP
Change vs. Change vs.
Fiscal Q2 2024 Fiscal Q2 2023 Fiscal Q1 2024
Net Revenue $172.1 million down 0.5% up 0.5%
Gross Margin 9.6% down 3900 bps down 3710 bps
Loss from Operations $(105.2) million down 932.6% down 6311.2%
Operating Margin (61.1)% down 6840 bps down 6210 bps
Net Loss $(102.7) million down 782.7% down 1204.9%
Net Margin (59.7)% down 6840 bps down 6510 bps
EPS - Diluted $(1.83) down 803.8% down 1243.8%
Quarterly Results - Non-GAAP
Change vs. Change vs.
Fiscal Q2 2024 Fiscal Q2 2023 Fiscal Q1 2024
Loss from Operations $(50.2) million down 345.9% down 560.5%
Operating Margin (29.2)% down 4100 bps down 3560 bps
Net Loss $(53.2) million down 342.8% down 413.6%
Net Margin (30.9)% down 4360 bps down 4080 bps
EPS - Diluted $(0.95) down 350% down 416.7%
A reconciliation between the GAAP and non-GAAP adjusted results is provided in
the financial tables included at the end of this press release. See also the
"Use of non-GAAP Financial Results" section of this press release.
1
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Fusen Chen, Kulicke & Soffa's President and Chief Executive Officer, stated,
"Despite a shifting Advanced Display market, we remain nimble and efficiency
focused. We are preparing for broader Ball Bonder demand recovery and have
reallocated Advanced Display resources to support growing demand and activity
within Thermocompression and Advanced Dispense. We look forward to achieve new
customer and market adoption milestones over the coming quarters."
During its recently completed quarter, the Company's Ball Bonder revenue has
grown by more than 50% over the same period in the prior fiscal year. K&S is
preparing to further ramp its Ball Bonder supply chain and production
activities, in support of General Semiconductor recovery, which includes
fulfilling a sizeable order from a fast-growing Assembly and Test customer of
1,000 RAPID" Pro systems, as announced earlier today.
Second Quarter Fiscal 2024 Financial Highlights
.
Net revenue of $172.1 million.
.
Gross margin of 9.6%.
Gross margin includes a one-time charge of $57.3 million of certain inventory
write down adjustments and purchase order cancellation charges of $2.8
million, substantially due to, and as previously anticipated by, the
cancellation of Project W.
.
Net loss of $102.7 million or $(1.83) per share; non-GAAP net loss of $53.2
million or $(0.95) per fully diluted share.
In addition to the inventory write-down adjustments, net loss also includes a
one-time impairment charge of $44.5 million on long-lived assets related to
the cancellation of Project W and employee termination benefits of $2.9
million.
.
GAAP cash flow from operations of $(20.1) million; Adjusted free cash flow of
$(26.7) million.
.
Cash, cash equivalents, and short-term investments were $634.7 million as of
March 30, 2024.
.
The Company repurchased a total of 0.8 million shares of common stock at a
cost of $37.3 million.
Third Quarter Fiscal 2024 Outlook
K&S currently expects net revenue in the third quarter of fiscal 2024 ending
June 29, 2024 to be approximately $180 million +/- $10 million, GAAP diluted
EPS to be approximately $0.17 +/- 10%, and non-GAAP diluted EPS to be
approximately $0.30 +/- 10%.
A reconciliation between the GAAP and non-GAAP financial outlook is provided
in the financial tables included at the end of this press release.
Earnings Conference Webcast
A webcast to discuss these results will be held on May 2, 2024, begi
nning at 8:00 am EDT.
The live webcast link, supplemental earnings presentation, and archived
webcast will be available at
investor.kns.com
. To access the audio-only portion of the live webcast, parties may call
+1-877-407-8037, or internationally, +1-201-689-8037.
An audio-only replay of the webcast will also be available approximately one
hour after the completion of the live call by calling +1-877-660-6853, or
internationally, +1-201-612-7415 and referencing access code 13743539.
2
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Use of Non-GAAP Financial Results
In addition to U.S. GAAP ("GAAP") results, this press release also contains
the following non-GAAP financial results: income from operations, operating
margin, net income, net margin, net income per fully diluted share and
adjusted free cash flow. The Company's non-GAAP results exclude amortization
related to intangible assets acquired through business combinations, costs
associated with restructuring and severance, equity-based compensation,
acquisition and integration costs, impairment relating to assets acquired
through business combinations, long-lived asset impairment relating to
business cessation or disposal, impairment relating to equity investments,
income tax expense/benefit arising from discrete tax items triggered by
acquisition, disposal of business (both via a sale or an abandonment),
restructuring and significant changes in tax laws, gain/loss on disposal of
business, as well as tax benefits or expenses associated with the foregoing
non-GAAP items. The non-GAAP adjustments may or may not be infrequent or
nonrecurring in nature, but are a result of periodic or non-core operating
activities. These non-GAAP measures are consistent with the way management
analyzes and assesses the Company's operating results. The Company believes
these non-GAAP measures enhance investors' understanding of the Company's
underlying operational performance, as well as their ability to compare the
Company's period-to-period financial results and the Company's overall
performance to that of its competitors.
Management uses both GAAP metrics as well as these non-GAAP metrics to
evaluate the Company's operating and financial results. Non-GAAP financial
measures may not provide information that is directly comparable to that
provided by other companies in the Company's industry, as other companies in
the industry may calculate non-GAAP financial results differently. In
addition, there are limitations in using non-GAAP financial measures because
the non-GAAP financial measures are not prepared in accordance with GAAP, may
be different from non-GAAP financial measures used by other companies and
exclude expenses that may have a material impact on the Company's reported
financial results. The presentation of non-GAAP items is meant to supplement,
but not substitute for, GAAP financial measures or information. The Company
believes the presentation of non-GAAP results in combination with GAAP results
provides better transparency to the investment community when analyzing
business trends, providing meaningful comparisons with prior period
performance and enhancing investors' ability to view the Company's results
from management's perspective. A reconciliation of each non-GAAP financial
measure to the most directly comparable GAAP measure discussed in this press
release is contained in the financial tables at the end of this press release.
3
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About Kulicke & Soffa
Founded in 1951, Kulicke & Soffa specializes in developing cutting-edge
semiconductor and electronics assembly solutions enabling a smart and more
sustainable future. Our ever-growing range of products and services supports
growth and facilitates technology transitions across large-scale markets, such
as advanced display, automotive, communications, compute, consumer, data
storage, energy storage and industrial.
Caution Concerning Results, Forward-Looking Statements and Certain Risks
Related to our Business
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. While these forward-looking statements
represent our judgments and future expectations concerning our business,
including the importance and competitiveness of our advanced display products
and other emerging technology transitions, 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 continued review of the impact of the cancellation of the
Project on our business, our ability to repurpose assets deployed or developed
for the Project to other parts of our business, our ability to seek potential
recourse, claims and remedies arising from the cancellation of the Project,
the persistent macroeconomic headwinds on our business, actual or potential
inflationary pressures, interest rate and risk premium adjustments, falling
customer sentiment, or economic recession caused directly or indirectly by
geopolitical tensions, our ability to develop, manufacture and gain market
acceptance of new products, our ability to operate our business in accordance
with our business plan and the other factors listed or discussed in our Annual
Report on Form 10-K for the fiscal year ended September 30, 2023, filed on
November 16, 2023, 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.
Contact:
Kulicke and Soffa Industries, Inc.
Joseph Elgindy
Finance
P: +1-215-784-7518
4
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KULICKE AND SOFFA INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except per share and employee data)
(Unaudited)
Three months ended Six months ended
March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023
Net revenue $ 172,074 $ 173,021 $ 343,263 $ 349,254
Cost of sales 155,603 88,929 246,896 176,456
Gross profit 16,471 84,092 96,367 172,798
Operating expenses:
Selling, general and administrative 35,185 33,063 75,231 73,563
Research and development 37,704 35,999 74,514 70,507
Impairment charges 44,472 - 44,472 -
Amortization of intangible assets 1,325 1,563 2,672 2,957
Acquisition-related costs - 334 - 441
Restructuring 2,940 504 2,940 879
Total operating expenses 121,626 71,463 199,829 148,347
(Loss) / Income from operations (105,155) 12,629 (103,462) 24,451
Other income (expense):
Interest income 8,848 8,000 18,747 14,559
Interest expense (18) (32) (40) (66)
(Loss) / Income before income taxes (96,325) 20,597 (84,755) 38,944
Income tax expense 6,355 5,556 8,632 9,314
Net (loss) / income $ (102,680) $ 15,041 $ (93,387) $ 29,630
Net (loss) / income per share:
Basic $ (1.83) $ 0.27 $ (1.66) $ 0.52
Diluted $ (1.83) $ 0.26 $ (1.66) $ 0.51
Cash dividends declared per share $ 0.20 $ 0.19 $ 0.40 $ 0.38
Weighted average shares outstanding:
Basic 56,154 56,684 56,402 56,868
Diluted 56,154 57,577 56,402 57,739
Three months ended Six months ended
Supplemental financial data: March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023
Depreciation and amortization $ 6,967 $ 6,542 $ 14,952 $ 12,155
Capital expenditures 3,846 17,383 7,379 33,034
Equity-based compensation expense:
Cost of sales 363 323 722 631
Selling, general and administrative 4,103 3,731 9,783 8,598
Research and development 1,766 1,325 3,584 2,671
Total equity-based compensation expense $ 6,232 $ 5,379 $ 14,089 $ 11,900
As of
March 30, 2024 April 1, 2023
Number of employees 2,925 3,089
5
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KULICKE AND SOFFA INDUSTRIES, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
As of
March 30, 2024 September 30, 2023
ASSETS
CURRENT ASSETS
Cash and cash $ 359,748 $ 529,402
equivalents
Short-term 275,000 230,000
investments
Accounts and other receivable, net of allowance for 194,819 158,601
doubtful accounts of $49 and $49, respectively
Inventories, net 180,541 217,304
Prepaid expenses and 40,309 53,751
other current assets
TOTAL CURRENT 1,050,417 1,189,058
ASSETS
Property, plant and 65,003 110,051
equipment, net
Operating 36,653 47,148
right-of-use assets
Goodwill 89,082 88,673
Intangible 27,139 29,357
assets, net
Deferred 18,101 31,551
tax assets
Equity 2,254 716
investments
Other assets 10,058 3,223
TOTAL ASSETS $ 1,298,707 $ 1,499,777
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable 51,487 49,302
Operating lease 7,021 6,574
liabilities
Accrued expenses and other 90,126 103,005
current liabilities
Income taxes 17,102 22,670
payable
TOTAL CURRENT 165,736 181,551
LIABILITIES
Deferred tax 36,377 37,264
liabilities
Income taxes 36,647 52,793
payable
Operating lease 34,307 41,839
liabilities
Other 13,463 11,769
liabilities
TOTAL 286,530 325,216
LIABILITIES
SHAREHOLDERS' EQUITY
Common stock, 584,626 577,727
no par value
Treasury (794,193) (737,214)
stock, at cost
Retained 1,239,956 1,355,810
earnings
Accumulated other (18,212) (21,762)
comprehensive loss
TOTAL SHAREHOLDERS' $ 1,012,177 $ 1,174,561
EQUITY
TOTAL LIABILITIES AND $ 1,298,707 $ 1,499,777
SHAREHOLDERS' EQUITY
6
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KULICKE AND SOFFA INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three months ended Six months ended
March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023
Net cash (used in)/provided $ (20,148) $ 1,820 $ (27,479) $ 86,936
by operating activities
Net cash provided by/ (used 3,429 (147,283) (57,112) (186,197)
in) investing activities
Net cash used in (47,672) (16,681) (85,796) (72,911)
financing activities
Effect of exchange rate changes (521) 633 733 5,737
on cash and cash equivalents
Changes in cash and (64,912) (161,511) (169,654) (166,435)
cash equivalents
Cash and cash equivalents, 424,660 550,613 529,402 555,537
beginning of period
Cash and cash equivalents, $ 359,748 $ 389,102 $ 359,748 $ 389,102
end of period
Short-term 275,000 345,000 275,000 345,000
investments
Total cash, cash equivalents $ 634,748 $ 734,102 $ 634,748 $ 734,102
and short-term investments
7
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Reconciliation of U.S. GAAP
to Non-GAAP Income from Operations and Operating Margin
(In thousands, except percentages)
(Unaudited)
Three months ended
March 30, 2024 April 1, 2023 December 30, 2023
Net revenue $ 172,074 $ 173,021 $ 171,189
U.S. GAAP income from operations (105,155) 12,629 1,693
U.S. GAAP operating margin (61.1) % 7.3 % 1.0 %
Pre-tax non-GAAP items:
Amortization related to intangible assets 1,325 1,563 1,347
Restructuring and severance 2,940 504 -
Equity-based compensation 6,232 5,379 7,857
Impairment charges 44,472 - -
Acquisition-related costs - 334 -
Non-GAAP income from operations $ (50,186) $ 20,409 $ 10,897
Non-GAAP operating margin (29.2) % 11.8 % 6.4 %
8
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Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income and Non-GAAP Net
Margin and
U.S. GAAP net income per share to Non-GAAP net income per share
(In thousands, except percentages and per share data)
(Unaudited)
Three months ended
March 30, 2024 April 1, 2023 December 30, 2023
Net revenue $ 172,074 $ 173,021 $ 171,189
U.S. GAAP net (loss) / income (102,680) 15,041 9,293
U.S. GAAP net margin (59.7) % 8.7 % 5.4 %
Non-GAAP adjustments:
Amortization related to intangible assets 1,325 1,563 1,347
Restructuring and severance 2,940 504 -
Equity-based compensation 6,232 5,379 7,857
Impairment charges 44,472 - -
Acquisition-related costs - 334 -
Net income tax benefit on non-GAAP items (5,534) (892) (1,516)
Total non-GAAP adjustments $ 49,435 $ 6,888 $ 7,688
Non-GAAP net (loss) / income $ (53,245) $ 21,929 $ 16,981
Non-GAAP net margin (30.9) % 12.7 % 9.9 %
U.S. GAAP net (loss) / income per share:
Basic (1.83) 0.27 0.16
Diluted (1.83) 0.26 0.16
(a)
Non-GAAP adjustments per share:
(b)
Basic 0.88 0.12 0.14
Diluted 0.88 0.12 0.14
Non-GAAP net (loss) / income per share:
Basic $ (0.95) $ 0.39 $ 0.30
Diluted $ (0.95) $ 0.38 $ 0.30
(c)
Weighted average shares outstanding:
Basic 56,154 56,684 56,650
Diluted 56,154 57,577 57,023
(a)
GAAP diluted net earnings per share reflects any dilutive effect of
outstanding restricted stock, but that effect is excluded when calculating
GAAP diluted net loss per share because it would be anti-dilutive.
(b)
Non-GAAP adjustments per share include amortization related to intangible
assets acquired through business combinations, costs associated with
restructuring and severance, acquisition and integration costs, equity-based
compensation expenses, long-lived asset impairment relating to business
cessation or disposal, and income tax effects associated with the foregoing
non-GAAP items.
(c)
Non-GAAP diluted net earnings per share reflects any dilutive effect of
outstanding restricted stock.
9
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Reconciliation of U.S. GAAP Cash provided by Operating Activities
to Non-GAAP Adjusted Free Cash Flow
(In thousands, except percentages)
(unaudited)
Three months ended
March 30, April 1, December 30, 2023
2024 2023
U.S. GAAP net cash (used in)/provided by operating activities $ (20,148) $ 1,820 $ (7,331)
Expenditures for property, plant and equipment (6,571) (10,637) (4,426)
Proceeds from sales of property, plant and equipment - 235 -
Non-GAAP adjusted free cash flow (26,719) (8,582) (11,757)
10
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Reconciliation of U.S. GAAP to Non-GAAP Outlook
(In millions, except per share data)
(Unaudited)
Third quarter of fiscal
2024 ending June 29, 2024
GAAP Outlook Adjustments Non-GAAP Outlook
Net revenue $180 million - $180 million
+/- $10 million +/- $10 million
Operating expenses $79.6 million $7.6 million $72.0 million
+/- 2% B,C +/- 2%
Diluted EPS $0.17 $0.13 $0.30
(1) +/- 10% A, B, C,D +/- 10%
Non-GAAP
Adjustments
A. Equity-based compensation 0.4
- Cost of sales
B. Equity-based compensation - Selling, general 6.3
and administrative and Research and development
C. Amortization related 1.3
to intangible assets
D. Net income tax effect (0.6)
of the above items
(1) GAAP and non-GAAP diluted EPS based on approximately 55.4 million diluted
weighted average shares outstanding.
The tables above reconcile our GAAP to non-GAAP guidance based on the current
outlook. The guidance does not incorporate the impact of any potential
business combinations, divestitures, restructuring activities, strategic
investments and other significant transactions. The timing and impact of such
items are dependent on future events that may be uncertain or outside of our
control.
11
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