Kulicke and Soffa Industries, Inc. (KLIC) Earnings Call Transcript & Summary

The meeting will please come to order. I am Peter Kong, Chairman of the Board of Directors. I would like to welcome you to our 60th stockholders' meeting as a public company. Before proceeding with the business of the meeting, I need to make a few administrative announcements. I would like to point out that the audio portion of this meeting is being broadcast live over the Internet at our website, www.kns.com, so to help our listeners. If anyone should have a question during the question-and-answer session later in the meeting, please use the microphone, which will be available in the audience. In addition, an audio recording will be made of the entire meeting, including any questions or comments that you may have. The audio recording will be available at our website for a limited time following this meeting. I also want to point out that in addition to historical statements, remarks and comments today may include forward-looking statements, which are covered by the safe harbor provisions of the 1995 Private Securities Litigation Reform Act. Actual results may turn out significantly better or worse than indicated by any forward-looking statements made this afternoon. For a more complete discussion of the risks associated with the operations of K&S, please refer to the company's SEC filings, especially to the 10-K for the year ending October 2, 2021. I would now like to introduce the other members of the Board of Directors of the company. Dr. Fusen E. Chen, who is also the President and Chief Executive Officer; Mr. Chin-Hu Lim; Mr. Gregory F. Milzcik; Mr. Jon A. Olson; Mr. David Jeffrey Richardson; Ms. Mui Sung Yeo. I now call on Ms. Waters, the Secretary of the company, for the required formal announcements.

Mr. Chairman, I present a copy of the notice of Internet availability of the meeting and proxy statement, the proxy card and the annual report. I also present an affidavit as to the mailing on January 14, 2022, of the notice of Internet availability to each person who was a stockholder of record on December 6, 2021, the record date for the meeting. The notice of meeting called this meeting for 1:00 p.m. on March 3, 2022, at Kulicke and Soffa Industries, Inc. 23A Serangoon North Avenue 5, #01-01, Singapore 554369 for the purposes of electing directors, ratifying the appointment of PricewaterhouseCoopers LLP as independent registered public accountants for the 2022 fiscal year, a nonbinding vote on executive compensation, and transacting such other business as may properly come before the meeting. I have a complete list of stockholders entitled to vote at this meeting. The list is available for inspection by the stockholders during the meeting for the purposes of the meeting.

The affidavit of mailing and the attachments thereto will be filed with the minutes of the meeting. As Chairman of the meeting, I appoint Peter Descovich as Judge of Election. If you are acting as a proxy for a stockholder, please file your written proxy with the Secretary if you have not already done so. If you desire to speak at the meeting, when I recognize you, please rise and give your name and state whether you are a stockholder or hold a proxy. If you hold a proxy, please give the name of your principal. The Judge of Election has informed me that there is a quorum present. Our custom has been to dispense with the reading of the minutes of the last annual meeting. Unless there is a request that the minutes of last year's meeting be read, I will move on to the 3 matters submitted to a vote of the shareholders, as outlined by Ms. Waters. We will defer voting until all of the matters are properly before the meeting and ready for voting. The Board of Directors has nominated Peter T. Kong for reelection and Jon A. Olson for election at the annual meeting to serve until the 2026 Annual Meeting and until their successors have been duly elected and qualified. The second order of business is the appointment of PricewaterhouseCoopers LLP as the company's independent registered public accountants. The Audit Committee of the Board appointed PricewaterhouseCoopers LLP as the company's independent registered public accountants for fiscal 2022. As you know, PricewaterhouseCoopers LLP has served as company's independent registered public accounting firm for the last fiscal year. I would like to introduce Mohd Saiful Saroni of PricewaterhouseCoopers LLP. If any shareholder has any questions of PricewaterhouseCoopers LLP, they can be raised during the question-and-answer period. The third order of business is an advisory vote to approve on a nonbinding basis the overall compensation of the company's named executive officers. If there is no discussion, we can now proceed to the voting on the matters before the meeting. As has been customary, we will vote on all matters by ballot. I'll now ask any stockholder who has not voted online via telephone or has not mailed in or delivered a proxy or who wishes to change a previous proxy vote or who wishes to vote in person to raise his or her hand so that the Secretary can give you a ballot. While we're waiting for the report of the Judge of Election, I would like to ask Dr. Fusen Chen, our President and CEO, to make a few remarks.

Since joining K&S in 2016, the organization has fundamentally evolved. We are now in a much stronger position to accelerate market expansion, increase profitability and increase sustainable value for our customers and investors. Over the last 5 years, this evolution has focused within 3 key areas, which I would like to briefly outline. First, we focus on enhancing our relationship position -- leadership position. Although we enjoy dominant shares in many existing markets, there were several adjacent opportunities, including LED lighting, power semiconductor and the leading-edge logic market, which were underserved. We have made a meaningful share gain within this specific area and continue to drive targeted investments to further expand our leadership position over the long term. Next, we successfully enhanced our organizational cultures to better drive success. The increased accountability and ownership at the employee, business unit and the corporate level has better enabled the organization to resolve challenges, course-correct it when necessary and improve the success rate of new initiatives. Today, we have several specific teams who are delivering innovative solutions that directly solve challenges facing our largest and the most influential customers. The last priority area was to expand and grow new high potential market, which can benefit from our long established strength in high-speed motion control, metrology, vision system, ultrasonic and material handling. These efforts have provided meaningful access into high-growth emerging applications such as silicon photonics, electric vehicle battery assembly and also advanced displays. We are very focused on executing and look forward to sharing updates with the investors on this key growth driver over the coming quarters. Today is a very exciting time, and the future is very bright for K&S. Our core business and the portfolio of new solutions are expanding and increasing alignment with fundamental long-term technology transition in the automotive, semiconductor and the display market. Over the coming quarters, we look forward to demonstrating our ability to create and deliver shareholder value. Thank you. That concludes my comments.

Thanks, Fusen. Now as has been customary, we're happy to entertain any questions you might have. I ask that each person who has a question to please use the microphone and get his or her name and state whether he or she is a stockholder or a proxy holder. If there are no further questions, I'm advised that the Judge of Election has completed the count of the votes and delivered the report to the Secretary. The Secretary will announce the results as reflected in the Judge's report.

The Judge's report shows 54,774,691 shares of common stock present in person and/or present by proxy, which the Judge has certified to be a quorum of the outstanding common stock on all matters presented to the meeting. The Judge's report further shows that sufficient votes were cast for the election of Peter T. Kong and Jon A. Olson for the ratification of the appointment of PricewaterhouseCoopers LLP and for approval, on a nonbinding basis, the overall compensation of the company's named executive officers.

In accordance with the results certified by the Judge of Election, I hereby declare that Peter T. Kong and Jon A. Olson have been elected directors for the term for which they were nominated, that the appointment of PricewaterhouseCoopers LLP as independent registered public accountants for their 2022 fiscal year has been ratified, and that the shareholders have approved on a nonbinding basis the overall compensation of the company's named executive officers. I order that the report of the Judge of Election be filed with the minutes of the meeting. The meeting is now adjourned. On behalf of all the directors, officers and employees, I thank all of you for attending the meeting.