Benchmark Electronics Reports Results for the Quarter Ended June 30, 2012

26 Jul, 2012, 07:00 ET from Benchmark Electronics, Inc.

ANGLETON, Texas, July 26, 2012 /PRNewswire/ -- Benchmark Electronics, Inc. (NYSE: BHE), a leading integrated contract manufacturing provider, today announced financial results for the second quarter which ended June 30, 2012.

Second Quarter 2012 Results

                                                               Three Months Ended  

June 30,  

March 31,  

June 30,  

2012

2012

2011

Net Sales (in millions)  

$630

$593

$586

Net Income (in millions)  

$14

$6

$15

Net Income – non-GAAP (in millions)  

$18

$14

$15

Diluted EPS  

$0.24

$0.10

$0.24

Diluted EPS – non-GAAP  

$0.32

$0.25

$0.25

Operating margin (%)  

2.9%

1.3%

2.4%

Operating margin – non-GAAP (%)  

3.7%

3.0%

2.5%

Second Quarter 2012 Highlights

  • Revenue of $630 million increased 6% and 8%, respectively, over Q1 of 2012 and Q2 of 2011.
  • Non-GAAP diluted earnings per share of $0.32 increased 28% over both Q1 of 2012 and Q2 of 2011.
  • Operating margin for the second quarter was 3.7% excluding restructuring and Thailand flood related charges of $5 million.
  • Thailand flood related charges of $5 million consist of costs directly attributable to the Thailand flood which are expected to be recovered from insurance in subsequent periods.
  • Cash flows provided by operating activities for Q2 2012 were approximately $41 million.
  • Cash and long-term investments balance was $297 million at June 30, 2012. Long-term investments consist of $16 million of auction rate securities.
  • Accounts receivable was $458 million at June 30, 2012; calculated days sales outstanding were 65 days compared to 72 days at March 31, 2012.
  • Inventory was $388 million at June 30, 2012; inventory turns improved to 6.0 times from 5.5 at March 31, 2012 and 5.5 at June 30, 2011.
  • Repurchases of common shares for the second quarter totaled $19 million or 1.4 million shares.

President and CEO Gayla J. Delly commented, "We are very pleased with the solid execution of our team for the second quarter in a weakening environment. Notably, our revenue and margin improvements were achieved while supporting numerous program ramps from previous quarters' bookings as well as the ongoing Thailand recovery efforts. Looking forward, the second quarter business development efforts provided strong bookings which is meaningful as these upcoming program launches together with the programs recently introduced will drive positive momentum in the face of a challenging macro environment."

Second Quarter Industry Sector Update

The following table sets forth revenue by industry sector for the quarters ended June 30, 2012, March 31, 2012 and June 30, 2011.

June 30,

  March 31,

June 30,

2012

2012

2011

Computers and related products  for business enterprises       

31%

31%

28%

Industrial control equipment    

26%

27%

28%

Telecommunications equipment  

25%

25%

23%

Medical devices  

10%

9%

10%

Testing and instrumentation products  

8%

8%

11%

Third Quarter 2012 Outlook

  • Revenue between $595 and $625 million
  • Diluted earnings per share between $0.27 and $0.32 (excluding restructuring and Thailand flood related charges)

Conference Call Details

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.

About Benchmark Electronics, Inc.

Benchmark Electronics, Inc. provides integrated manufacturing, design and engineering services to original equipment manufacturers of computers and related products for business enterprises, medical devices, industrial control equipment (which includes equipment for the aerospace and defense industry), testing and instrumentation products, and telecommunication equipment. Benchmark's global operations include 21 facilities in nine countries. Benchmark's Common Shares trade on the New York Stock Exchange under the symbol BHE.

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.

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. Our forward-looking statements may be deemed to include, among other things, the statement "these upcoming program launches together with the programs recently introduced will drive positive momentum in the face of a challenging macro environment", our sales and diluted earnings per share (excluding special items) guidance for the third quarter of 2012, as well as other statements, express or implied, concerning: the potential recovery of insurance proceeds; 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. 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, 2011, in its other filings with the Securities and Exchange Commission and in its press releases.

Benchmark Electronics, Inc. and Subsidiaries

 

Reconciliation of GAAP to Non-GAAP Financial Results (Amounts in Thousands, Except Per Share Data) (UNAUDITED)

Three Months Ended June 30,

Six Months Ended June 30,

2012

2011

2012

2011

Income from operations (GAAP)

$

18,268

$

14,166

$

26,093

$

29,947

Restructuring charges

286

480

250

480

Thailand flood related charges

4,658

14,876

Non-GAAP income from operations

$

23,212

$

14,646

$

41,219

$

30,427

Net income (GAAP)

$

13,580

$

14,701

$

19,178

$

29,214

Restructuring charges, net of tax

287

477

161

477

Thailand flood related charges

4,373

13,375

Non-GAAP net income

$

18,240

$

15,178

$

32,714

$

29,691

Earnings per share: (GAAP)

    Basic

$

0.24

$

0.24

$

0.34

$

0.48

    Diluted

$

0.24

$

0.24

$

0.33

$

0.48

Earnings per share: (Non-GAAP)

    Basic

$

0.32

$

0.25

$

0.57

$

0.49

    Diluted

$

0.32

$

0.25

$

0.57

$

0.49

Weighted average shares used in calculating

     earnings per share:

    Basic

56,963

60,159

57,223

60,537

    Diluted

57,198

60,567

57,599

61,125

 

 

Benchmark Electronics, Inc. and Subsidiaries

 

Consolidated Statements of Income (Amounts in Thousands, Except Per Share Data) (UNAUDITED)

Three Months Ended

June 30,

Six Months Ended

June 30,

2012

2011

2012

2011

Net sales

$

630,031

$

585,549

$

1,223,448

$

1,123,861

Cost of sales

584,040

547,798

1,136,949

1,048,486

Gross profit

45,991

37,751

86,499

75,375

Selling, general and administrative expenses

22,779

23,105

45,280

44,948

Restructuring charges

286

480

250

480

Thailand flood related charges

4,658

14,876

Income from operations

18,268

14,166

26,093

29,947

Other income (expense):

Interest income

231

443

609

847

Interest expense

(322)

(331)

(647)

(663)

Other

(448)

731

(82)

296

Total other income (expense), net

(539)

843

(120)

480

Income before income taxes

17,729

15,009

25,973

30,427

Income tax expense

4,149

308

6,795

1,213

Net income

$

13,580

$

14,701

$

19,178

$

29,214

Denominator for basic earnings per share - weighted average number of common shares outstanding during the period

 

 

56,963

 

 

60,159

 

 

57,223

 

 

60,537

Incremental common shares attributable to restricted shares and the exercise of outstanding equity instruments

 

 

235

 

 

408

 

 

376

 

 

588

Denominator for diluted earnings per share

57,198

60,567

57,599

61,125

 

Earnings per share:

           Basic

$

0.24

$

0.24

$

0.34

$

0.48

           Diluted

$

0.24

$

0.24

$

0.33

$

0.48

 

Benchmark Electronics, Inc. and Subsidiaries

 

Condensed Consolidated Balance Sheet June 30, 2012 (Amounts in Thousands) (UNAUDITED)

Assets

Current assets:

Cash and cash-equivalents

$

280,812

Accounts receivable, net

457,969

Inventories, net

387,665

Other current assets

74,722

Total current assets

1,201,168

Long-term investments

15,729

Property, plant and equipment, net

168,483

Other assets, net

69,665

Goodwill, net

37,912

Total assets

$

1,492,957

Liabilities and Shareholders' Equity

Current liabilities:

Current installments of capital lease obligations

$

458

Accounts payable

277,042

Accrued liabilities

66,488

Total current liabilities

343,988

Capital lease obligations, less current installments

10,361

Other long-term liabilities

22,169

Shareholders' equity

1,116,439

Total liabilities and shareholders' equity

$

1,492,957

SOURCE Benchmark Electronics, Inc.



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