Kulicke & Soffa Reports Exit Costs & Impairments

TL;DR

KULI filing 8-K for exit costs & impairments - watch for financial impact.

AI Summary

Kulicke & Soffa Industries, Inc. filed an 8-K on March 11, 2024, to report on costs associated with exit or disposal activities and material impairments. The filing also includes a Regulation FD Disclosure, indicating important information is being shared publicly. Specific financial details or the nature of the disposal activities were not detailed in the provided excerpt.

Why It Matters

This filing signals potential restructuring or asset write-downs by Kulicke & Soffa, which could impact future financial performance and investor outlook.

Risk Assessment

Risk Level: medium — The filing indicates potential financial restructuring or asset write-downs, which could introduce uncertainty and affect the company's valuation.

Key Players & Entities

• Kulicke & Soffa Industries, Inc. (company) — Registrant
• March 11, 2024 (date) — Filing date and earliest event reported

FAQ

Key Financial Figures

• $110 million — including impairments, in the range of $110 million and $130 million. The pre-tax cash exp
• $130 million — ments, in the range of $110 million and $130 million. The pre-tax cash expenditures include
• $3 million — tures include (i) between approximately $3 million and $5 million of one-time termination
• $5 million — i) between approximately $3 million and $5 million of one-time termination benefits, (ii)
• $8 million — on benefits, (ii) between approximately $8 million and $13 million of contract termination
• $13 million — i) between approximately $8 million and $13 million of contract termination charges, and (i
• $6 million — harges, and (iii) between approximately $6 million and $11 million of other associated cos
• $11 million — i) between approximately $6 million and $11 million of other associated costs. The Company
• $49 million — nt charges of (i) between approximately $49 million and $53 million of inventory write-down
• $53 million — ) between approximately $49 million and $53 million of inventory write-down charges, and (i
• $44 million — charges, and (ii) between approximately $44 million and $48 million of impairment charges r
• $48 million — ) between approximately $44 million and $48 million of impairment charges relating to long-
• $170 m — ontinues to anticipate total revenue of $170 million, +/- $10 million, during the seco
• $10 m — pate total revenue of $170 million, +/- $10 million, during the second fiscal quarter
• $15 million — scal year 2024 revenue by approximately $15 million. The Company intends to refocus its dev

Filing Documents

• klic-20240311.htm (8-K) — 35KB
• 0000056978-24-000042.txt ( ) — 193KB
• klic-20240311.xsd (EX-101.SCH) — 2KB
• klic-20240311_def.xml (EX-101.DEF) — 7KB
• klic-20240311_lab.xml (EX-101.LAB) — 28KB
• klic-20240311_pre.xml (EX-101.PRE) — 17KB
• klic-20240311_htm.xml (XML) — 4KB

05 Cost Associated with Exit or Disposal Activities

Item 2.05 Cost Associated with Exit or Disposal Activities. Previously referred to as Project W, the Company has been engaged with one of its strategic customers (the "Customer") to support the Customer with the development and future mass production of certain technologies relating to advanced display (the "Project"). In connection with the Customer's strategic review of its business, the Customer has informed the Company that it has cancelled the Project. In connection with the foregoing, on March 11, 2024, the Company committed to a plan to cease operational activities and commence wind down activities concerning various aspects of the Project, as a result of which the Company expects to incur pre-tax charges, including impairments, in the range of $110 million and $130 million. The pre-tax cash expenditures include (i) between approximately $3 million and $5 million of one-time termination benefits, (ii) between approximately $8 million and $13 million of contract termination charges, and (iii) between approximately $6 million and $11 million of other associated costs. The Company also expects to incur pre-tax non-cash impairment charges of (i) between approximately $49 million and $53 million of inventory write-down charges, and (ii) between approximately $44 million and $48 million of impairment charges relating to long-lived assets. The Company plans to recognize the non-cash inventory write-down and impairment charges in the second fiscal quarter of 2024, with the remaining cash expenditures to be recognized over the course of fiscal year 2024. The Company expects to complete majority of its wind down activities by the end of fiscal year 2024. The estimates of the charges and expenditures that the Company expects to incur, and the timing thereof, are subject to a number of assumptions and actual amounts may differ materially from estimates.

06 Material Impairments

Item 2.06 Material Impairments. The information set forth above under Item 2.05 is incorporated into this Item 2.06 by reference.

01 Regulation FD Disclosure

Item 7.01 Regulation FD Disclosure. Consistent with the guidance provided by the Company during its earnings call on February 1, 2024, the Company continues to anticipate total revenue of $170 million, +/- $10 million, during the second fiscal quarter of 2024. Additionally, the Company anticipates that the cancellation of the Project will reduce its fiscal year 2024 revenue by approximately $15 million. The Company intends to refocus its development resources towards other growth-centric opportunities supporting technology changes within the Thermo-compression, Vertical Fan-Out, Automotive and Dispense markets over the coming quarters. Additional information regarding the near-term business outlook will be shared on the Company's second fiscal quarter earnings call . The information furnished in this Item 7.01 of this Current Report on Form 8-K shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise be subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing or document. Cautionary Note Regarding Forward-Looking Statements This Current Report on Form 8-K contains statements relating to future events and expectations regarding our future results. These statements are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to a historical or current fact. The words "expect," "anticipate," "intend," and similar expressions, among others, generally identify "forward looking statements," which speak o

View Full Filing

View this 8-K filing on SEC EDGAR