Benchmark Electronics, Inc.
Sales revenue for the year ended December 31, 2005 was $2.3 billion, a 12.8% increase from $2.0 billion in the previous year. Net income for the year ended December 31, 2005 was $80.6 million, compared to $71.0 million for the prior year. Diluted earnings per share was $1.88 for the year ended December 31, 2005, compared to $1.67 per share in the prior year.
"We continued to execute well throughout the fourth quarter and full year of 2005 resulting in a year of record revenues and earnings. We fully expect our momentum and level of execution to continue into 2006 and beyond," stated Benchmark's President and CEO Cary T. Fu.
Fourth Quarter 2005 Financial Highlights
* Operating margin for the fourth quarter was 4.65%.
* Cash flows provided by operating activities for the fourth quarter was
$15 million.
* Cash and short-term investments balance at December 31, 2005 of
$327 million.
* No debt outstanding.
* Accounts receivable balance at December 31, 2005 of $366 million;
calculated days sales outstanding were 53 days.
* Inventory of $362 million at December 31, 2005; inventory turns were
6.4 times.
First Quarter and Full Year 2006 Guidance
Revenues for the first quarter of 2006 are expected to be between $590 million and $615 million. Diluted earnings per share for the first quarter are expected to be between $0.50 and $0.54, excluding restructuring charges and the impact of stock-based compensation expenses.
Revenues for the full year 2006 are expected to be between $2.47 billion and $2.54 billion. Diluted earnings per share for 2006 are expected to between $2.11 and $2.17, excluding restructuring charges and the impact of stock-based compensation expenses.
During 2006, the Company will continue to expand our low-cost capacity while realigning and further strengthening our global footprint to support continued business opportunities. Restructuring charges associated with these re-alignment efforts, primarily related to the closure of our UK facility, are estimated to be in the range of $3.5 million to $4.5 million pre-tax during 2006. The actual timing of such charges has yet to be determined, although it is expected that the majority of these charges will be recorded in the first half of 2006.
Benchmark currently expects fiscal year 2006 GAAP earnings per share to be $2.00 to $2.05 per diluted share which includes an estimated $0.06 - $0.07 per diluted share associated with restructuring charges to be incurred and $0.05 per share for stock-based compensation to be expensed in fiscal year 2006 under new accounting guidelines, SFAS 123R.
Forward-Looking Statements
This news release contains certain forward-looking statements within the scope of the Securities Act of 1933 and the Securities Exchange Act of 1934. The words "expect," "estimate," "anticipate," "predict," and similar expressions, and the negatives of such expressions, are intended to identify forward-looking statements. Although Benchmark believes that these statements are based upon reasonable assumptions, such statements involve risks, uncertainties and assumptions, including but not limited to industry and economic conditions, customer actions and the other factors discussed in Benchmark's Form 10-K for the year ended December 31, 2004 and its other filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated.
Benchmark Electronics, Inc. is in the business of manufacturing electronics and provides its services to original equipment manufacturers of computers and related products for business enterprises, medical devices, industrial control equipment, testing and instrumentation products, and telecommunication equipment. Benchmark's global operations include facilities in eight countries. Benchmark's Common Shares trade on the New York Stock Exchange under the symbol BHE.
A conference call hosted by Benchmark management will be held today at 10:00 a.m. (Central time) to discuss the financial results of the Company and its future outlook. This call will be broadcast via the Internet and may be accessed by logging on to our website at http://www.bench.com/.
Benchmark Electronics, Inc. and Subsidiaries
Consolidated Statements of Income
(Amounts in Thousands, Except Per Share Data)
(UNAUDITED)
Three Months Ended Year Ended
December 31, December 31,
2005 2004 2005 2004
Net sales $625,374 $524,232 $2,257,225 $2,001,340
Cost of sales 580,307 484,489 2,095,623 1,847,573
Gross profit 45,067 39,743 161,602 153,767
Selling, general and
administrative expenses 16,015 15,504 62,322 61,108
Income from operations 29,052 24,239 99,280 92,659
Other income (expense):
Interest expense (92) (154) (330) (1,705)
Other 2,176 596 6,864 3,199
Total other income, net 2,084 442 6,534 1,494
Income before income
taxes 31,136 24,681 105,814 94,153
Income tax expense 6,481 4,474 25,225 23,162
Net income $24,655 $20,207 $80,589 $70,991
Denominator for basic
earnings per share --
weighted average number
of common shares
outstanding during the
period 41,990 41,407 41,788 41,134
Incremental common shares
attributable to exercise
of outstanding dilutive
options 904 1,213 1,065 1,331
Denominator for diluted
earnings per share 42,894 42,620 42,853 42,465
Earnings per share:
Basic $0.59 $0.49 $1.93 $1.73
Diluted $0.57 $0.47 $1.88 $1.67
Benchmark Electronics, Inc. and Subsidiaries
Condensed Consolidated Balance Sheet
December 31, 2005
(Amounts in Thousands)
(UNAUDITED)
Assets
Current assets:
Cash and cash-equivalents $110,845
Short-term investments 215,960
Accounts receivable, net 365,568
Inventories, net 361,554
Other current assets 30,579
Total current assets 1,084,506
Property, plant and equipment, net 94,140
Other assets, net 6,784
Goodwill, net 112,978
Total assets $1,298,408
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $371,887
Other current liabilities 66,256
Total current liabilities 438,143
Other long-term liabilities 14,146
Shareholders' equity 846,119
Total liabilities and shareholders' equity $1,298,408
SOURCE: Benchmark Electronics, Inc.
CONTACT: Gayla J. Delly, Chief Financial Officer of Benchmark
Electronics, Inc., +1-979-849-6550
Web site: http://www.bench.com/
