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Technology Stocks : Kulicke and Soffa -- Ignore unavailable to you. Want to Upgrade?

To: HoodBuilder who wrote (2129)	11/18/1997 8:29:00 PM
From: Darin	Respond to of 5482

To All, Read and smile!! Kulicke sees Delco venture profitable in 98 By Richard Melville BOCA RATON, Fla., Nov 18 (Reuters) - Kulicke & Soffa Industries Inc (Nasdaq:KLIC - news) expects its ''flip chip'' venture with the Delco Electronics unit of General Motors Corp's (NYSE:GM - news) Hughes Electronics Corp (NYSE:GMH - news) to turn profitable in 1998, the company's top executive said Tuesday. At SoundView Financial's Technology Outlook conference, chairman and chief executive Scott Kulicke said the venture, which is seeking to commercialize a Delco- developed technology for chip connections, has received its first production order and is negotiating a licensing pact for the technology. "We expect it to go positive in 1998," Kulicke said. Flip chip technology refers to a process under which chip connections are done using small bumps of solder rather than wires. The name is derived from the fact that the solder is applied to the top of the chips, which are put in place upside- down to make the connections. The production order and pending licensing pact are both with European companies, Kulicke said. Kulicke said the company has worked through all the problems associated with rollout of its 8000-series of wire bonders for chip production and by March 1998 will complete a switch in production and sales to the new-generation machines. That schedule reflects a delay of about two months due to manufacture processing issues that arose during initial field testing earlier this year, he said. ''While we were going through that, we were unwilling to put more machines out to customers,'' Kulicke said. The company has a backlog of orders for the new machines from Motorola Inc (NYSE:MOT - news), Advanced Micro Devices Inc (NYSE:AMD - news) and others, he said. In early October, Kulicke & Soffa warned investors that earnings for the December quarter, its fiscal first, would likely be below estimates because many orders it took in the fourth quarter were not scheduled for delivery until late in the winter, after the close of the December quarter. Kulicke said problems in Asia were not hurting business at the semiconductor equipment maker and the company's customers continued to express confidence in their outlook. In 1996, Kulicke & Soffa posted losses in its June and September quarters when several Asian customers temporarily stopped ordering equipment. ''The obvious question is are (Asian customers) losing confidence now, and to a customer they have said 'No,''' he said. ''There have been no discussions about (order) stretchouts and no sliding deliveries.'' Kulicke said most of the company's Asian customers are subcontractors whose revenues from chip processing tasks are dollar-denominated, which insulates them in the short run from the crisis. ''In the short run, the currency crisis works to their favor, because their costs are in local currency and their sales are in dollars,'' he said.