Benchmark Electronics, Inc.
"We delivered yet another quarter of strong performance despite continued component constraints in the supply chain, which impacted our revenues and inventory levels in the first quarter," said Cary T. Fu, the Company's Chief Executive Officer. "We achieved record new program bookings during the quarter which are expected to provide a solid foundation for future growth, generating estimated annual revenue at full production of $300 million to $375 million."
First Quarter 2010 Financial Highlights -- Operating margin for the first quarter was 3.7% on a GAAP basis and 4.0%, excluding restructuring charges. -- Cash flows provided by operating activities for the first quarter were approximately $6 million. -- Cash and long-term investments balance was $446 million at March 31, 2010. Long-term investments consist of $45 million of auction rate securities. -- Accounts receivable was $408 million at March 31, 2010; calculated days sales outstanding were 64 days. -- Inventory was $362 million at March 31, 2010; inventory turns were 5.8 times. -- Repurchases of common shares for the first quarter totaled $18 million or 0.9 million shares. -- Previously announced restructuring initiatives in the Americas were completed during the first quarter and resulted in restructuring charges of approximately $1.7 million related to capacity reduction and severance costs. Second Quarter 2010 Outlook
Sales for the second quarter of 2010 are expected to range from $600 million to $630 million. Diluted earnings per share for the second quarter, excluding restructuring charges, are expected to be between $0.31 and $0.34.
Non-GAAP Financial Measures
This press release includes financial measures for earnings and earnings per share that exclude certain items and therefore are not in accordance with generally accepted accounting principles (GAAP). A detailed reconciliation between the GAAP results and results excluding special items (non-GAAP) is included at the end of this press release. By disclosing this non-GAAP information, management intends to provide investors with additional information to further analyze the company's performance and underlying trends. Management utilizes a measure of net income and earnings per share on a non-GAAP basis that excludes certain items to better assess operating performance and to help investors compare our results with our previous guidance.
The non-GAAP information included in this press release is not necessarily comparable to non-GAAP information of other companies. Non-GAAP information should not be viewed as a substitute for, or superior to, net income or other data prepared in accordance with GAAP as measures of our profitability or liquidity. Users of this financial information should consider the types of events and transactions for which adjustments have been made.
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. Our forward-looking statements may be deemed to include, among other things, the statement "we achieved record new program bookings during the quarter which are expected to provide a solid foundation for future growth, generating estimated annual revenue at full production of $300 million to $375 million", and our sales and diluted earnings per share (excluding restructuring charges) guidance for the second quarter of 2010, as well as other statements, express or implied, concerning: future operating results or the ability to generate sales, income or cash flow; and Benchmark's business and growth strategies, including expected internal growth and performance goals. 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, and customer actions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated.
All forward-looking statements included in this release are based upon information available to Benchmark as of the date of this release, and Benchmark assumes no obligation to update any such forward-looking statements. Persons are advised to consult further disclosures on related subjects in Benchmark's Form 10-K for the year ended December 31, 2009, in its other filings with the Securities and Exchange Commission and in its press releases.
Benchmark Electronics, Inc. provides integrated electronics manufacturing, design and engineering 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 23 facilities in ten 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 am (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 www.bench.com.
Benchmark Electronics, Inc. and Subsidiaries Reconciliation of GAAP to Non-GAAP Financial Results (Amounts in Thousands, Except Per Share Data) (UNAUDITED) Three Months Ended March 31, 2010 2009 ---- ---- Income from operations (GAAP) $21,132 $10,172 Restructuring charges 1,697 1,130 Non-GAAP income from operations $22,829 $11,302 ======= ======= Net income (GAAP) $18,250 $9,238 Restructuring charges, net of tax 847 1,056 Non-GAAP net income $19,097 $10,294 ======= ======= Earnings per share: (GAAP) Basic $0.29 $0.14 Diluted $0.29 $0.14 Earnings per share: (Non-GAAP) Basic $0.30 $0.16 Diluted $0.30 $0.16 Weighted average shares used in calculating earnings per share: Basic 63,403 65,097 Diluted 63,957 65,261 Benchmark Electronics, Inc. and Subsidiaries Consolidated Statements of Income (Amounts in Thousands, Except Per Share Data) (UNAUDITED) Three Months Ended March 31, 2010 2009 ---- ---- Net sales $571,905 $496,767 Cost of sales 526,560 465,131 ------- ------- Gross profit 45,345 31,636 Selling, general and administrative expenses 22,516 20,334 Restructuring charges and integration costs 1,697 1,130 ----- ----- Income from operations 21,132 10,172 Other income (expense): Interest income 367 839 Interest expense (339) (351) Other (371) (396) ---- ---- Total other income (expense), net (343) 92 ---- --- Income before income taxes 20,789 10,264 Income tax expense 2,539 1,026 Net income $18,250 $9,238 ======= ====== Denominator for basic earnings per share - weighted average number of common shares outstanding during the period 63,403 65,097 Incremental common shares attributable to restricted shares and the exercise of outstanding equity instruments 554 164 --- --- Denominator for diluted earnings per share 63,957 65,261 ====== ====== Earnings per share: Basic $0.29 $0.14 ===== ===== Diluted $0.29 $0.14 ===== ===== Benchmark Electronics, Inc. and Subsidiaries Condensed Consolidated Balance Sheet March 31, 2010 (Amounts in Thousands) (UNAUDITED) Assets ------ Current assets: Cash and cash-equivalents $400,568 Accounts receivable, net 407,717 Inventories, net 361,962 Other current assets 46,505 ------ Total current assets 1,216,752 Long-term investments 45,209 Property, plant and equipment, net 126,763 Other assets, net 57,495 Goodwill, net 37,912 ------ Total assets $1,484,131 ========== Liabilities and Shareholders' Equity Current liabilities: Current installments of capital lease obligations $314 Accounts payable 296,664 Accrued liabilities 59,717 ------ Total current liabilities 356,695 Capital lease obligations, less current installments 11,302 Other long-term liabilities 24,230 Shareholders' equity 1,091,904 --------- Total liabilities and shareholders' equity $1,484,131 ==========
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SOURCE: Benchmark Electronics, Inc.
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