Diodes To Cease Operations At Lee's Summit Wafer Fab In Q3 - Quick Facts

(RTTNews) - Diodes Incorporated (DIOD) announced it has been notified that the landlord of its wafer fab in Lee's Summit, Mo. has decided not to renew the lease of the KFAB wafer fabrication plant, which expires on December 31, 2017. KFAB has leased this facility since 1994. Diodes has begun activities to transfer the KFAB wafer manufacturing operations to other Diodes' wafer fabrication plants and external foundries. Total KFAB shutdown costs are expected to be approximately $10 million to $12 million, on a pretax basis, which will be expensed and paid throughout 2017.

The company estimates the quarterly shutdown charges in 2017 to be: approximately $1.1 million ($0.7 million after tax, or approximately $0.01 per share) in first quarter 2017; approximately $1.1 million ($0.7 million after tax, or approximately $0.01 per share) in second quarter 2017; approximately $2.9 million ($1.9 million after tax, or approximately $0.04 per share) in third quarter 2017; and approximately $5.7 million ($3.7 million after tax, or approximately $0.07 per share) in fourth quarter 2017.

Diodes experienced a fire on November 18, 2016 in the wet etch wafer fabrication area at its wafer fab in Lee's Summit, Mo. The fire resulted in a temporary suspension of production. Normal production resumed on January 23, 2017.