Benchmark Electronics Inc. (BHE, Financial) filed Quarterly Report for the period ended 2012-03-31.
Benchmark Eletr has a market cap of $919 million; its shares were traded at around $14.84 with a P/E ratio of 15.8 and P/S ratio of 0.4.
During the three months ended March 31, 2012, sales to customers in the computers and related products for business enterprises industry, telecommunication equipment industry, medical devices and industrial control equipment industry increased 25%, 19%, 13% and 8%, respectively, from the same period in 2011. In the first three months of 2012, these increases were partially offset by a 34% decrease in sales to customers in the testing and instrumentation products industry.
Gross profit increased 8% to $40.5 million for the three months ended March 31, 2012 from $37.6 million in the same period of 2011 due primarily to an increase in sales. Gross profit as a percentage of sales decreased to 6.8% during the first quarter of 2012 from 7.0% in the first quarter of 2011 primarily due to sales mix changes, new program ramp costs, and the impact of duplicative and program transition costs related to the Thailand flooding. We experience fluctuations in gross profit from period to period. Different programs contribute different gross profits depending on factors such as the types of services involved, location of production, size of the program, complexity of the product and level of material costs associated with the various products. Moreover, new programs can contribute relatively less to our gross profit in their early stages when manufacturing volumes are usually lower, resulting in inefficiencies and under-absorbed manufacturing overhead costs. In addition, a number of our new and higher volume programs remain subject to competitive constraints that could exert downward pressure on our margins. During periods of low production volume, we generally have idle capacity and reduced gross profit.
Selling, general and administrative expenses increased 3% to $22.5 million in the first quarter of 2012 from $21.8 million in the first quarter of 2011. The increase in selling, general and administrative expenses is primarily due to higher variable compensation expenses. Selling, general and administrative expenses, as a percentage of sales, were 3.8% and 4.1%, respectively, for the first quarters of 2012 and 2011. The decrease in selling, general and administrative expenses as a percentage of sales is primarily associated with the impact of higher sales volumes in the first quarter of 2012.
We reported net income of $5.6 million, or diluted earnings per share of $0.10 for the first three months of 2012, compared with net income of $14.5 million, or diluted earnings per share of $0.24 for the same period of 2011. The net decrease of $8.9 million from 2011 was primarily due to the factors discussed above.
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Benchmark Eletr has a market cap of $919 million; its shares were traded at around $14.84 with a P/E ratio of 15.8 and P/S ratio of 0.4.
Highlight of Business Operations:
Sales for the three months ended March 31, 2012 increased 10% to $593.4 million compared to $538.3 million for the same period of 2011. During the three months ended March 31, 2012, sales to customers in the computers and related products for business enterprises industry, telecommunication equipment industry, medical devices and industrial control equipment industry increased 25%, 19%, 13% and 8%, respectively, from 2011. In the first three months of 2012, these increases were partially offset by a 34% decrease in sales to customers in the testing and instrumentation products industry.During the three months ended March 31, 2012, sales to customers in the computers and related products for business enterprises industry, telecommunication equipment industry, medical devices and industrial control equipment industry increased 25%, 19%, 13% and 8%, respectively, from the same period in 2011. In the first three months of 2012, these increases were partially offset by a 34% decrease in sales to customers in the testing and instrumentation products industry.
Gross profit increased 8% to $40.5 million for the three months ended March 31, 2012 from $37.6 million in the same period of 2011 due primarily to an increase in sales. Gross profit as a percentage of sales decreased to 6.8% during the first quarter of 2012 from 7.0% in the first quarter of 2011 primarily due to sales mix changes, new program ramp costs, and the impact of duplicative and program transition costs related to the Thailand flooding. We experience fluctuations in gross profit from period to period. Different programs contribute different gross profits depending on factors such as the types of services involved, location of production, size of the program, complexity of the product and level of material costs associated with the various products. Moreover, new programs can contribute relatively less to our gross profit in their early stages when manufacturing volumes are usually lower, resulting in inefficiencies and under-absorbed manufacturing overhead costs. In addition, a number of our new and higher volume programs remain subject to competitive constraints that could exert downward pressure on our margins. During periods of low production volume, we generally have idle capacity and reduced gross profit.
Selling, general and administrative expenses increased 3% to $22.5 million in the first quarter of 2012 from $21.8 million in the first quarter of 2011. The increase in selling, general and administrative expenses is primarily due to higher variable compensation expenses. Selling, general and administrative expenses, as a percentage of sales, were 3.8% and 4.1%, respectively, for the first quarters of 2012 and 2011. The decrease in selling, general and administrative expenses as a percentage of sales is primarily associated with the impact of higher sales volumes in the first quarter of 2012.
We reported net income of $5.6 million, or diluted earnings per share of $0.10 for the first three months of 2012, compared with net income of $14.5 million, or diluted earnings per share of $0.24 for the same period of 2011. The net decrease of $8.9 million from 2011 was primarily due to the factors discussed above.
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