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KULICKE & SOFFA INDUSTRIES INC0000056978falseSingapore00000569782023-05-032023-05-030000056978dei:OtherAddressMember2023-05-032023-05-03

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 3, 2023 
____________________________________________________
KULICKE AND SOFFA INDUSTRIES, INC.
(Exact name of registrant as specified in its charter) 
 ____________________________________________________ 
Pennsylvania   000-00121   23-1498399
(State or Other Jurisdiction
of Incorporation)
  (Commission File Number)   (I.R.S. Employer
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 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§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. ☐



Item 2.02     Results of Operations and Financial Condition.
On May 3, 2023, Kulicke and Soffa Industries, Inc. (the “Company”) issued a press release with respect to its financial results for its second fiscal quarter ended April 1, 2023. 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
104 Inline XBRL for the cover page of this Current Report on Form 8‑K.




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 3, 2023 By: /s/ LESTER WONG  
  Name: Lester Wong  
  Title: Executive Vice President and Chief Financial Officer
(principal financial officer and principal accounting
officer)
     


EX-99.1 2 ex991q22023.htm EX-99.1 Document

Exhibit 99.1
logoa02a01a01a48a.jpg
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 2023 Results
Improved Fiscal Second Half Demand Anticipated
Singapore – May 3, 2023 – Kulicke and Soffa Industries, Inc. (NASDAQ: KLIC) (“Kulicke & Soffa,” “K&S” or the “Company”), today announced financial results of its second fiscal quarter ended April 1, 2023. The Company reported second quarter net revenue of $173.0 million, net income of $15.0 million, representing EPS of $0.26 per fully diluted share, and non-GAAP net income of $21.9 million, representing non-GAAP EPS of $0.38 per fully diluted share.

Quarterly Results - U.S. GAAP
   
Fiscal Q2 2023
 
Change vs.
Fiscal Q2 2022
Change vs.
Fiscal Q1 2023
Net Revenue $173.0 million down 55% down 1.8%
Gross Profit $84.1 million down 58.3% down 5.2%
Gross Margin 48.6% down 390 bps down 170 bps
Income from Operations $12.6 million down 90.3% up 6.8%
Operating Margin 7.3% down 2640 bps up 60 bps
Net Income $15.0 million down 87.1% up 2.7%
Net Margin 8.7% down 2150 bps up 40 bps
EPS – Diluted $0.26 down 86% up 4%

Quarterly Results - Non-GAAP
 
Fiscal Q2 2023
 
Change vs.
Fiscal Q2 2022
Change vs.
Fiscal Q1 2023
Income from Operations $20.4 million down 84.9% up 1%
Operating Margin 11.8% down 2340 bps up 30 bps
Net Income $21.9 million down 82% up 0.5%
Net Margin 12.7% down 1890 bps up 30 bps
EPS – Diluted $0.38 down 80.5% up 2.7%
A reconciliation between the GAAP and non-GAAP adjusted results is provided in the financial tables included in this release. See also the “Use of non-GAAP Financial Results” section.


1


Fusen Chen, Kulicke & Soffa's President and Chief Executive Officer, stated, "We remain very focused on supporting technology transitions within the advanced display, advanced packaging and automotive markets through several high-profile customer engagements and broadening adoption of our emerging solutions. Additionally, we have experienced an uptick in customer interest and quote activity related to our high-volume markets."

Second Quarter Fiscal 2023 Financial Highlights
•Net revenue of $173.0 million.
•Gross margin of 48.6%.
•Net income of $15.0 million or $0.26 per share; non-GAAP net income of $21.9 million or $0.38 per share.
•GAAP cash from operations of $86.9 million; Adjusted free cash flow of $62.7 million
•Cash, cash equivalents, and short-term investments were $734.1 million as of April 1, 2023.
•The Company repurchased a total of 0.1 million shares of common stock at a cost of $5.0 million.

Third Quarter Fiscal 2023 Outlook
The Company currently expects net revenue in the third fiscal quarter of 2023 ending July 1, 2023 to be approximately $190 +/- $20 million, GAAP EPS to be approximately $0.23 +/- 10%, and non-GAAP EPS to be approximately $0.32 +/- 10%.

Fusen Chen commented, "We continue to expand market access and align on new, high-growth opportunities, while diversifying our end-market exposure. Past market expansion efforts have improved our trough-level performance and have better enhanced our long-term ability to create and deliver value to shareholders. While the rate of near-term growth will be governed by industry inventory levels and macro dynamics, we continue to anticipate gradual demand improvement across our portfolio over the coming quarters.”

During its second fiscal quarter the Company completed its acquisition of Advanced Jet Automation Co., Ltd., including the material business and assets formerly owned by its affiliate, Samurai Spirit Inc., a leading developer and manufacturer of high-precision micro-dispensing equipment and solutions in Taiwan.

Earnings Conference Call Details
A conference call to discuss these results will be held on May 4, 2023, beginning at 8:00am EDT. To access the conference call, interested parties may call +1-877-407-8037 or internationally +1-201-689-8037. A live webcast link and supplemental earnings presentation will also be available at investor.kns.com.

A replay will be available from approximately one hour after the completion of the call through May 11, 2023 by calling toll-free +1-877-660-6853 or internationally +1-201-612-7415 and using the replay ID number of 13734621. A webcast replay will also be available at investor.kns.com.

Use of Non-GAAP Financial Results
In addition to U.S. 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 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, impairment relating to equity investments, income tax expense arising from discrete tax items triggered by acquisition, 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.
2


Management uses both U.S. 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 available GAAP to non-GAAP financial measure discussed in this press release is contained in the financial tables at the end of this press release.

Management has not reconciled its outlook for non-GAAP Diluted EPS to Diluted EPS for Q3F23 as it does not provide guidance on the reconciling items between Diluted EPS and non-GAAP Diluted EPS, as a result of the uncertainty regarding, and the potential variability of, these items. The actual amount of such reconciling items could have a significant impact on our non-GAAP Diluted EPS and, accordingly, a reconciliation of Diluted EPS to non-GAAP Diluted EPS for Q3F23 is not available without unreasonable effort.
 
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 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. 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 effects of the COVID-19 pandemic and macroeconomic headwinds on our business, our ability to develop, manufacture and gain market acceptance of new products, and the other factors listed or discussed in our Annual Report on Form 10-K for the fiscal year ended October 1, 2022, filed on November 17, 2022, 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.


Contacts:
Kulicke and Soffa Industries, Inc.
Joseph Elgindy
Finance
P: +1-215-784-7518
3


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
April 1, 2023 April 2, 2022 April 1, 2023 April 2, 2022
Net revenue $ 173,021  $ 384,282  $ 349,254  $ 845,170 
Cost of sales 88,929  182,572  176,456  420,222 
Gross profit 84,092  201,710  172,798  424,948 
Operating expenses:
Selling, general and administrative 33,063  33,937  73,563  71,487 
Research and development 35,999  37,281  70,507  70,450 
Amortization of intangible assets 1,563  1,151  2,957  2,434 
Acquisition-related costs 334  —  441  — 
Restructuring 504  —  879  126 
Total operating expenses 71,463  72,369  148,347  144,497 
Income from operations 12,629  129,341  24,451  280,451 
Other income (expense):
Interest income 8,000  470  14,559  941 
Interest expense (32) (97) (66) (137)
Income before income taxes 20,597  129,714  38,944  281,255 
Income tax expense 5,556  13,713  9,314  31,648 
Net income $ 15,041  $ 116,001  $ 29,630  $ 249,607 
Net income per share:
Basic $ 0.27  $ 1.89  $ 0.52  $ 4.03 
Diluted $ 0.26  $ 1.86  $ 0.51  $ 3.97 
Cash dividends declared per share $ 0.19  $ 0.17  $ 0.38  $ 0.34 
Weighted average shares outstanding:
Basic 56,684  61,482  56,868  61,934 
Diluted 57,577  62,435  57,739  62,907 
  Three months ended Six months ended
Supplemental financial data: April 1, 2023 April 2, 2022 April 1, 2023 April 2, 2022
Depreciation and amortization $ 6,542  $ 5,224  $ 12,155  $ 10,563 
Capital expenditures 17,383  3,384  33,034  6,260 
Equity-based compensation expense:
Cost of sales 323  308  631  534 
Selling, general and administrative 3,731  3,296  8,598  7,252 
Research and development 1,325  1,092  2,671  2,222 
Total equity-based compensation expense $ 5,379  $ 4,696  $ 11,900  $ 10,008 

  As of
April 1, 2023 April 2, 2022
Number of employees 3,089  3,445 

4


KULICKE AND SOFFA INDUSTRIES, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
As of
April 1, 2023 October 1, 2022
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 389,102  $ 555,537 
Short-term investments 345,000  220,000 
Accounts and other receivable, net of allowance for doubtful accounts of $0 and $0, respectively 169,140  309,323 
Inventories, net 224,159  184,986 
Prepaid expenses and other current assets 61,472  62,200 
TOTAL CURRENT ASSETS 1,188,873  1,332,046 
Property, plant and equipment, net 110,680  80,908 
Operating right-of-use assets 44,908  41,767 
Goodwill 98,893  68,096 
Intangible assets, net 39,892  31,939 
Deferred tax assets 32,157  25,572 
Equity investments 5,433  5,397 
Other assets 3,206  2,874 
TOTAL ASSETS $ 1,524,042  $ 1,588,599 
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES    
Accounts payable 54,851  67,311 
Operating lease liabilities 7,271  6,766 
Accrued expenses and other current liabilities 112,301  134,541 
Income taxes payable 21,328  40,063 
TOTAL CURRENT LIABILITIES 195,751  248,681 
Deferred tax liabilities 36,180  34,037 
Income taxes payable 52,537  64,634 
Operating lease liabilities 39,557  34,927 
Other liabilities 16,320  11,670 
TOTAL LIABILITIES 340,345  393,949 
SHAREHOLDERS' EQUITY    
Common stock, no par value 567,031  561,684 
Treasury stock, at cost (719,619) (675,800)
Retained earnings 1,349,736  1,341,666 
Accumulated other comprehensive loss (13,451) (32,900)
TOTAL SHAREHOLDERS' EQUITY $ 1,183,697  $ 1,194,650 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,524,042  $ 1,588,599 
5


KULICKE AND SOFFA INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
  Three months ended Six months ended
  April 1, 2023 April 2, 2022 April 1, 2023 April 2, 2022
Net cash provided by operating activities $ 1,820  $ 73,135  $ 86,936  $ 169,009 
Net cash (used in) / provided by investing activities (147,283) 134,172  (186,197) 141,461 
Net cash used in financing activities (16,681) (186,987) (72,911) (211,064)
Effect of exchange rate changes on cash and cash equivalents 633  (1,357) 5,737  (1,741)
Changes in cash and cash equivalents (161,511) 18,963  (166,435) 97,665 
Cash and cash equivalents, beginning of period 550,613  441,490  555,537  362,788 
Cash and cash equivalents, end of period $ 389,102  $ 460,453  $ 389,102  $ 460,453 
Short-term investments 345,000  230,000  345,000  230,000 
Total cash, cash equivalents and short-term investments $ 734,102  $ 690,453  $ 734,102  $ 690,453 


6


Reconciliation of U.S. GAAP
to Non-GAAP Income from Operations and Operating Margin
(In thousands, except percentages)
(Unaudited)
  Three months ended
April 1, 2023 April 2, 2022 December 31, 2022
Net revenue $ 173,021  $ 384,282  $ 176,233 
U.S. GAAP income from operations 12,629  129,341  11,822 
U.S. GAAP operating margin 7.3  % 33.7  % 6.7  %
Pre-tax non-GAAP items:
Amortization related to intangible assets acquired through business combination- selling, general and administrative 1,563  1,151  1,394 
Restructuring 504  —  375 
Equity-based compensation 5,379  4,696  6,521 
Acquisition-related costs
334  —  107 
Non-GAAP income from operations $ 20,409  $ 135,188  $ 20,219 
Non-GAAP operating margin 11.8  % 35.2  % 11.5  %

7


Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income 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
April 1, 2023 April 2, 2022 December 31, 2022
Net revenue $ 173,021  $ 384,282  $ 176,233 
U.S. GAAP net income 15,041  116,001  14,589 
U.S. GAAP net margin 8.7  % 30.2  % 8.3  %
Non-GAAP adjustments:
Amortization related to intangible assets acquired through business combination- selling, general and administrative 1,563  1,151  1,394 
Restructuring 504  —  375 
Equity-based compensation 5,379  4,696  6,521 
Acquisition-related costs 334  —  107 
Net income tax benefit on non-GAAP items (892) (385) (1,218)
Total non-GAAP adjustments $ 6,888  $ 5,462  $ 7,179 
Non-GAAP net income $ 21,929  $ 121,463  $ 21,768 
Non-GAAP net margin 12.7  % 31.6  % 12.4  %
U.S. GAAP net income per share:
Basic 0.27  1.89  0.26 
Diluted(a)
0.26  1.86  0.25 
Non-GAAP adjustments per share:(b)
Basic 0.12  0.09  0.13 
Diluted 0.12  0.09  0.12 
Non-GAAP net income per share:
Basic $ 0.39  $ 1.98  $ 0.39 
Diluted(c)
$ 0.38  $ 1.95  $ 0.37 
Weighted average shares outstanding:
Basic 56,684  61,482  57,051 
Diluted 57,577  62,435  57,729 
(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, 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.

8


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
April 1,
2023
April 2,
2022
December 31,
2022
U.S. GAAP net cash provided by operating activities $ 86,936  $ 73,135  $ 85,116 
Expenditures for property, plant and equipment (24,515) (5,658) (13,878)
Proceeds from sales of property, plant and equipment 235  119  — 
Non-GAAP adjusted free cash flow 62,656  67,596  71,238 

9