Exhibit 99.1
[LETTERHEAD KULICKE & SOFFA]
[LOGO] Kulicke & Soffa
NEWS for Immediate Release
Kulicke & Soffa Reports Preliminary Results for Fiscal Year 2002
A conference call to discuss these results will be held today beginning at 9:00
AM EST. Interested participants may call 416-695-5259 for the teleconference or
log on to www.kns.com for the audio feed.
Willow Grove, PA--November 15, 2002--Kulicke & Soffa Industries, Inc. (Nasdaq:
KLIC) today announced preliminary financial results for its fourth quarter and
fiscal year ended September 30, 2002.
During the fourth quarter the Company performed its annual goodwill impairment
test required under the provisions of SFAS Statement 142 "Goodwill and Other
Intangible Assets." The results of this annual test indicated that goodwill
related to its Test and Hub Blade reporting units was impaired. The Company
estimates that this non-cash impairment charge will be approximately $74.3
million. The amount could be subject to adjustment pending finalization of the
calculation.
Revenue for the fourth quarter ended September 30, 2002 was $122.2 million. The
fourth quarter 2002 net loss of $195.0 million or $3.95 per fully diluted share
included charges for resizing of $6.3 million, other severance charges of $5.0
million recorded in SG&A, and non-cash asset impairment charges of $101.0
million including $74.3 million of estimated goodwill impairment. Additionally,
in the fourth quarter the Company recorded a non-cash valuation allowance on
U.S. net operating loss carry forwards and other tax credits of $65.3 million.
For the full year ended September 30, 2002, revenue was $464.7 million. The net
loss for the year ended September 30, 2002 of $274.1 million or $5.57 per fully
diluted share included charges for resizing of $19.7 million, other severance
charges of $5.0 million recorded in SG&A, and non-cash asset impairment charges
of $105.9 million, including $74.3 million of estimated goodwill impairment.
Additionally, in the fourth quarter the Company recorded a non-cash valuation
allowance on U.S. net operating loss carry forwards and other tax credits of
$65.3 million.
In the fourth quarter ended September 30, 2002, as part of the income tax
provision for the period, the Company recorded a non-cash charge of $65.3
million, or $1.32 per fully diluted share, through the establishment of a
valuation allowance against its deferred tax asset consisting primarily of U.S.
net operating loss carry forwards. The valuation allowance is in accordance with
generally accepted accounting principles which require the assessment of the
Company's performance and other relevant factors when determining the need for a
valuation allowance. Factors such as recent losses are given substantially more
weight than forecasts of future profitability. Until the Company
utilizes these U.S. operating loss carry forwards, the income tax provision will
reflect modest levels of foreign taxation.
The Company completed the year with $111.3 million in cash, cash equivalents and
short term maturities.
Net bookings for fiscal year 2002 were $470.0 million including $110.0 million
in the September quarter. Backlog at September 30, 2002 was $54.0 million
compared to $49.0 million as of September 30, 2001 and $66.0 million at the end
of the third fiscal quarter of 2002.
C. Scott Kulicke, chairman and chief executive officer, stated, "The non-cash
charges that we recorded this quarter are reflective of nearly two years of
progressively weakening industry conditions and will not have an impact on
future operations. Our near term priorities are to focus on cash flow and to
return K&S to profitability, while continuing to provide our customers with
leading edge products and services."
He continued, "Our guidance for the first fiscal quarter of 2003 ending December
31, 2002 is for revenue of $95.0 million to $105.0 million."
Kulicke & Soffa is the world's leading supplier of semiconductor assembly and
test interconnect equipment, materials and technology. Assembly solutions
combine wire bonding equipment with bonding wire and capillaries. Test
interconnect solutions include standard and vertical probe cards; ATE interface
assemblies and ATE boards for wafer testing; and test sockets and contactors for
all types of packages. Kulicke & Soffa's web site address is www.kns.com.
Caution Concerning Forward Looking Statements
This press release contains forward-looking statements which are found in
various places throughout the press release. While these forward-looking
statements represent our judgments and future expectations concerning the
development of 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,
those listed or discussed in Kulicke & Soffa Industries' 2001 Annual Report on
Form 10-K and: 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 cost
savings will not be achieved; the volatility in the demand for semiconductors
and our products and services; 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 other key
factors that could adversely affect our businesses and financial performance
contained in past and future filings and reports, including those with the SEC.
Kulicke & Soffa Industries is under no obligation to (and expressly disclaims
any such obligations to) update or alter its forward-looking statements whether
as a result of new information, future events or otherwise.
# # #
Company Contact: Nancy R. Kyle, 215-784-6436, 215-784-6167 fax, nkyle@kns.com
CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share and employee data)
(Unaudited)
Three months ended Twelve months ended
September 30, September 30,
------------------------------------- -------------------------------------
2001 2002 (1) 2001 2002 (1)
---------------- ---------------- --------------- -----------------
Net revenue $ 117,791 $ 122,170 $ 555,003 $ 464,660
Cost of sales 93,027 94,348 392,604 365,799
---------------- ---------------- --------------- -----------------
Gross profit 24,764 27,822 162,399 98,861
---------------- ---------------- --------------- -----------------
Selling, general and administrative 33,352 37,933 141,751 139,134
Research and development, net 13,106 13,672 62,727 52,948
Resizing 3,257 6,274 4,966 19,661
Asset impairment - 26,704 - 31,594
Goodwill impairment (2) - 74,295 - 74,295
Amortization of goodwill and intangibles 6,762 2,423 22,810 9,864
Purchased in-process research and development - - 11,709 -
---------------- ---------------- --------------- -----------------
Loss from operations (31,713) (133,479) (81,564) (228,635)
Interest, net (2,941) (4,595) (5,535) (14,929)
Other income 9 2,000 8,368 2,010
---------------- ---------------- --------------- -----------------
Loss before income taxes (34,645) (136,074) (78,731) (241,554)
Income taxes (3) (10,372) 58,931 (21,643) 32,561
---------------- ---------------- --------------- -----------------
Loss before cumulative effect of
change in accounting principle (24,273) (195,005) (57,088) (274,115)
Cumulative effect of change in accounting
principle, net of tax - - (8,163) -
---------------- ---------------- --------------- -----------------
Net loss $ (24,273) $(195,005) $ (65,251) $(274,115)
================ ================ =============== =================
Net loss per share:
Basic $ (0.50) $ (3.95) $ (1.34) $ (5.57)
================ ================ =============== =================
Diluted $ (0.50) $ (3.95) $ (1.34) $ (5.57)
================ ================ =============== =================
Weighted average shares outstanding:
Basic 49,010 49,362 48,877 49,217
Diluted 49,010 49,362 48,877 49,217
September 30,
-------------------------------------
Additional financial data: 2001 2002
--------------- -----------------
Backlog of orders $ 49,000 $ 54,000
Number of employees 3,710 3,297
(1) Reflects the adoption of SFAS 142 "Goodwill and Other Intangible Assets"
(2) Based on preliminary estimate of Goodwill Impairment.
(3) Includes Valuation Allowance on U.S. Net Operating Loss Carry Forwards of
$65.3 million.
KULICKE & SOFFA INDUSTRIES, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
(In thousands)
(Unaudited)
Fiscal 2002:
Packaging Advanced
Equipment Materials Packaging Test
Quarter ended September 30, 2002: Segment Segment Segment Segment Corporate Consolidated
----------- ----------- ----------- ----------- ----------- --------------
Net revenue $ 45,754 $ 42,899 $ 4,995 $ 28,522 $ - $ 122,170
Cost of sales 34,945 31,375 5,874 22,154 - 94,348
----------- ----------- ----------- ----------- ----------- --------------
Gross profit 10,809 11,524 (879) 6,368 - 27,822
Operating costs 22,528 9,804 4,848 13,099 3,749 54,028
Resizing costs (1,283) (569) 8,616 (185) (305) 6,274
Goodwill impairment (1) - 2,295 - 72,000 - 74,295
Asset impairment - 1,394 8,402 - 16,908 26,704
----------- ----------- ----------- ----------- ----------- --------------
Income (loss) from operations $ (10,436) $ (1,400) $ (22,745) $ (78,546) $ (20,352) $ (133,479)
=========== =========== =========== =========== =========== ==============
Twelve months ended September 30, 2002:
Net revenue $ 169,469 $ 157,176 $ 23,317 $ 114,698 $ - $ 464,660
Cost of sales 142,965 118,080 25,068 79,686 - 365,799
----------- ----------- ----------- ----------- ----------- --------------
Gross profit 26,504 39,096 (1,751) 35,012 - 98,861
Operating costs 84,707 29,146 21,087 51,382 15,624 201,946
Resizing costs 4,781 167 9,720 4,715 278 19,661
Goodwill impairment (1) - 2,295 - 72,000 - 74,295
Asset impairment 2,165 2,874 8,402 1,245 16,908 31,594
----------- ----------- ----------- ----------- ----------- --------------
Income (loss) from operations $ (65,149) $ 4,614 $ (40,960) $ (94,330) $ (32,810) $ (228,635)
=========== =========== =========== =========== =========== ==============
Fiscal 2001:
Packaging Advanced
Equipment Materials Packaging Test
Quarter ended September 30, 2001: Segment Segment Segment Segment Corporate Consolidated
----------- ----------- ----------- ----------- ----------- --------------
Net revenue $ 54,128 $ 29,590 $ 8,215 $ 25,858 $ - $ 117,791
Cost of sales 41,567 22,697 6,986 21,777 - 93,027
----------- ----------- ----------- ----------- ----------- --------------
Gross profit 12,561 6,893 1,229 4,081 - 24,764
Operating costs 21,192 6,269 5,974 15,728 4,057 53,220
Resizing costs 799 2,167 - 270 21 3,257
----------- ----------- ----------- ----------- ----------- --------------
Income (loss) from operations $ (9,430) $ (1,543) $ (4,745) $ (11,917) $ (4,078) $ (31,713)
=========== =========== =========== =========== =========== ==============
Twelve months ended September 30, 2001:
Net revenue $ 249,952 $ 150,945 $ 37,216 $ 116,890 $ - $ 555,003
Cost of sales 166,359 110,570 31,274 84,401 - 392,604
----------- ----------- ----------- ----------- ----------- --------------
Gross profit 83,593 40,375 5,942 32,489 - 162,399
Operating costs 103,386 28,667 25,395 54,169 15,671 227,288
Resizing costs 2,223 2,421 - 270 52 4,966
Purchased in-process research and development - - - 11,709 - 11,709
----------- ----------- ----------- ----------- ----------- --------------
Income (loss) from operations $ (22,016) $ 9,287 $ (19,453) $ (33,659) $ (15,723) $ (81,564)
=========== =========== =========== =========== =========== ==============
(1) Based on preliminary estimate of Goodwill Impairment.
KULICKE & SOFFA INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEET
(In thousands)
(Unaudited)
September 30, September 30,
2001 2002
----------------- ----------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 155,036 $ 89,166
Short-term investments 47,892 22,134
Accounts and notes receivable (less allowance for doubtful
accounts: 9/30/01 - $6,242; 9/30/02 - $6,033) 79,305 89,132
Inventories, net 74,364 50,887
Prepaid expenses and other current assets 9,013 10,508
Deferred income taxes 15,282 16,072
----------------- -----------------
TOTAL CURRENT ASSETS 380,892 277,899
Property, plant and equipment, net 127,952 89,742
Intangible assets, (net of accumulated amortization:
9/30/01 - $9,416; 9/30/02 - $19,230) 103,525 75,509
Goodwill 150,474 87,107 (1)
Other assets 14,583 8,425
----------------- -----------------
TOTAL ASSETS $ 777,426 $ 538,682
================= =================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Debt due within one year $ 753 $ 186
Accounts payable 51,420 55,659
Accrued expenses 48,965 52,581
Income taxes payable 14,399 9,660
----------------- -----------------
TOTAL CURRENT LIABILITIES 115,537 118,086
Long term debt 301,511 300,393
Other liabilities 13,777 14,106
Deferred taxes 8,054 36,774
----------------- -----------------
TOTAL LIABILITIES 438,879 469,359
----------------- -----------------
SHAREHOLDERS' EQUITY
Common stock, without par value 193,058 199,886
Retained earnings / (deficit) 155,012 (119,103)
Accumulated other comprehensive loss (9,523) (11,460)
----------------- -----------------
TOTAL SHAREHOLDERS' EQUITY 338,547 69,323
----------------- -----------------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 777,426 $ 538,682
================= =================
(1) Based on preliminary estimate of Goodwill Impairment.