Benchmark Electronics Reports Results For The Quarter Ended June 30, 2013

Jul 25, 2013, 07:00 ET from Benchmark Electronics, Inc.

ANGLETON, Texas, July 25, 2013 /PRNewswire/ -- Benchmark Electronics, Inc. (NYSE: BHE), a leading integrated contract manufacturing provider, today announced financial results for the second quarter which ended June 30, 2013.

Three Months Ended

June 30,

March 31,

June 30,

2013

2013

2012

Net sales (in millions)

$608

$542

$630

Net income (in millions)

$8

$11

$14

Net income – non-GAAP (in millions)

$17

$12

$18

Diluted EPS

$0.16

$0.21

$0.24

Diluted EPS – non-GAAP

$0.31

$0.22

$0.32

Operating margin (%)

2.1

%

2.6

%

2.9

%

Operating margin – non-GAAP (%)

3.5

%

2.7

%

3.7

%

"In the second quarter, we delivered strong performance with revenue and operating margins (non-GAAP) up sequentially from the first quarter of this year," said President and CEO Gayla J. Delly. "While the current macro environment provides limited visibility, we continue to see good long-term opportunities with new and existing customers. Our business development efforts resulted in another quarter of robust bookings, providing a solid foundation for continued growth."

Second Quarter 2013 Highlights

  • Revenue of $608 million increased 12% from Q1 2013.
  • Revenue bookings in Q2 2013 were $135 million to $155 million.
  • During the quarter, we acquired Suntron Corporation for $19 million which includes two sites: Tijuana, Mexico and Phoenix, Arizona.
  • Non-GAAP diluted earnings per share of $0.31 was above our expectations primarily impacted by Q2 revenue strength.
  • Restructuring and integration costs of $6 million are primarily related to severance and asset impairment charges related to the closure of our Brazil manufacturing operations.
  • Asset impairment charge and other of $3 million primarily relates to the impairment of a building classified as "Held for Sale".
  • Cash flows provided by operating activities for Q2 2013 were approximately $11 million. There were no Thailand flood insurance recoveries during Q2 2013 and the recovery process with our insurance carriers is ongoing.
  • Cash and long-term investments balance was $409 million at June 30, 2013.
  • Accounts receivable was $464 million at June 30, 2013; calculated days sales outstanding were 69 days compared to 69 days at March 31, 2013 and 65 days at June 30, 2012.
  • Inventory was $350 million at June 30, 2013; inventory turns were 6.4 times compared to 6.3 at March 31, 2013 and 6.0 at June 30, 2012.
  • Repurchases of common shares for the second quarter totaled $9 million or  520 thousand shares.

Second Quarter Industry Sector Update The following table sets forth revenue by industry sector for the quarters ended June 30, 2013, March 31, 2013 and June 30, 2012.

June 30,

March 31,

June 30,

2013

2013

2012

Computers and related products for business

enterprises

29

%

25

%

31

%

Industrial control equipment

30

30

26

Telecommunication equipment

23

26

25

Medical devices

12

13

10

Testing and instrumentation products

6

6

8

100

%

100

%

100

%

Third Quarter 2013 Outlook

  • Revenue between $590 and $620 million.
  • Diluted earnings per share between $0.28 and $0.32 (excluding restructuring and Thailand flood related items).

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 23 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 statements "while the current macro environment provides limited visibility, we continue to see good long-term opportunities with new and existing customers" and "our business development efforts resulted in another quarter of robust bookings, providing a solid foundation for continued growth", our sales and diluted earnings per share (excluding special items) guidance for the third quarter of 2013, 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, 2012, 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

Six Months Ended

June 30,

June 30,

2013

2012

2013

2012

Income from operations (GAAP)

$

12,783

$

18,268

$

26,776

$

26,093

Restructuring charges and integration costs

5,667

286

6,109

250

Asset impairment charge and other

2,606

-

2,606

-

Thailand flood related charges, net of insurance

-

4,658

-

14,876

Non-GAAP income from operations

$

21,056

$

23,212

$

35,491

$

41,219

Net income (GAAP)

$

8,457

$

13,580

$

19,944

$

19,178

Restructuring charges and integration costs, net of tax

5,541

287

5,945

161

Asset impairment charge and other, net of tax

2,849

-

2,849

-

Thailand flood related charges, net of insurance and tax

-

4,373

-

13,375

Non-GAAP net income

$

16,847

$

18,240

$

28,738

$

32,714

Earnings per share: (GAAP)

Basic

$

0.16

$

0.24

$

0.37

$

0.34

Diluted

$

0.16

$

0.24

$

0.36

$

0.33

Earnings per share: (Non-GAAP)

Basic

$

0.31

$

0.32

$

0.53

$

0.57

Diluted

$

0.31

$

0.32

$

0.52

$

0.57

Weighted-average number of shares used in calculating earnings per share:

Basic

54,207

56,963

54,500

57,223

Diluted

54,500

57,198

54,897

57,599

 

Benchmark Electronics, Inc. and Subsidiaries

Consolidated Statements of Income

(Amounts in Thousands, Except Per Share Data)

(UNAUDITED)

Three months ended

Six Months Ended

June 30,

June 30,

2013

2012

2013

2012

Sales

$

607,522

$

630,031

$

1,149,966

$

1,223,448

Cost of sales

563,155

584,040

1,068,765

1,136,949

Gross profit

44,367

45,991

81,201

86,499

Selling, general and administrative expenses

23,311

22,779

45,710

45,280

Restructuring charges and integration costs

5,667

286

6,109

250

Asset impairment charge and other

2,606

-

2,606

-

Thailand flood related charges, net of insurance

-

4,658

-

14,876

Income from operations

12,783

18,268

26,776

26,093

Interest expense

(463)

(322)

(922)

(647)

Interest income

291

231

705

609

Other expense, net

(501)

(448)

(185)

(82)

Income before income taxes

12,110

17,729

26,374

25,973

Income tax expense

3,653

4,149

6,430

6,795

Net income

$

8,457

$

13,580

$

19,944

$

19,178

Earnings per share:

Basic

$

0.16

$

0.24

$

0.37

$

0.34

Diluted

$

0.16

$

0.24

$

0.36

$

0.33

Weighted-average number of shares used in calculating earnings per share:

Basic

54,207

56,963

54,500

57,223

Diluted

54,500

57,198

54,897

57,599

 

Benchmark Electronics, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands)

June 30,

December 31,

2013

2012

(unaudited)

Assets

Current assets:

Cash and cash equivalents

$

398,902

$

384,579

Accounts receivable, net

464,491

459,081

Inventories, net

350,416

324,041

Other current assets

44,712

46,490

Total current assets

1,258,521

1,214,191

Long-term investments

10,575

10,324

Property, plant and equipment, net

173,954

176,104

Goodwill, net

37,912

37,912

Other, net

57,856

62,946

Total assets

$

1,538,818

$

1,501,477

Liabilities and Shareholders' Equity

Current liabilities:

Current installments of capital lease obligations

$

538

$

497

Accounts payable

294,222

260,622

Accrued liabilities

65,477

69,396

Total current liabilities

360,237

330,515

Capital lease obligations, less current installments

9,822

10,103

Other long-term liabilities

22,482

21,334

Shareholders' equity

1,146,277

1,139,525

Total liabilities and shareholders' equity

$

1,538,818

$

1,501,477

 

SOURCE Benchmark Electronics, Inc.



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