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Benchmark Electronics Reports Results for the Quarter Ended June 30, 2009

July 29, 2009 | About:

Press Release: Benchmark Electronics Reports Results for the Quarter Ended June 30, 2009

ANGLETON, Texas, July 29 /PRNewswire-FirstCall/ -- Benchmark Electronics, Inc. (NYSE: BHE), a leading contract manufacturing provider, announced sales of $482 million for the quarter ended June 30, 2009, compared to $682 million for the same quarter in the prior year. The Company reported second quarter net income of $12 million, or $0.18 per diluted share. In the comparable period of 2008, net income was $22 million, or $0.33 per diluted share. Excluding restructuring charges, the Company would have reported net income of $12 million, or $0.19 per diluted share, in the second quarter of 2009. "End market demand stabilized during the quarter, except for the computing sector, which saw declines from the first quarter. These declines were offset by increased sales in all the other sectors we serve," said Cary T. Fu, the Company\'s Chief Executive Officer. "We improved profitability from the first quarter, reduced inventories and generated operating cash flows and, at the same time, aligned our capacity with customer demand. In recent weeks we have seen the pipeline of opportunities increase, but we remain guarded about the overall economy." Second Quarter 2009 Financial Highlights
  • Operating margin for the second quarter was 2.6% on a GAAP basis and 2.8%, excluding restructuring charges.
  • Cash flows provided by operating activities for the second quarter and first half were approximately $13 million and $77 million, respectively.
  • Cash and long-term investments balance was $452 million at June 30, 2009. Long-term investments consist of $48 million of auction rate securities.
  • Accounts receivable was $350 million at June 30, 2009; calculated days sales outstanding were 66 days.
  • Inventory was $322 million at June 30, 2009; inventory turns were 5.6 times.
  • Repurchases of common shares for the second quarter totaled $4 million or 0.3 million shares.
Third Quarter 2009 Outlook Sales for the third quarter of 2009 are expected to range from $470 million to $520 million. Diluted earnings per share for the third quarter, excluding restructuring charges, are expected to be between $0.17 and $0.22. 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, our sales and diluted earnings per share (excluding restructuring charges), guidance for the third quarter of 2009, 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. All forward-looking statements included in this release are based upon information available to Benchmark as of the date of the release, and Benchmark assumes no obligation to update any such forward-looking statements. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated. Persons are advised to consult further disclosures on related subjects in Benchmark\'s Form 10-K for the year ended December 31, 2008, in its other filings with the Securities and Exchange Commission and in its press releases. Additional Information Benchmark Electronics, Inc. provides 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 24 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    Six Months Ended                                          June 30,             June 30,                                      2009        2008      2009      2008                                      ----        ----      ----      ----    Income from operations (GAAP)   $12,353     $22,507   $22,525    $43,589    Restructuring charges             1,017           -     2,147          -                                    -------     -------   -------    -------    Non-GAAP income from operations $13,370     $22,507   $24,672    $43,589                                    =======     =======   =======    =======    Net income (GAAP)               $11,555     $22,142   $20,793    $44,471    Restructuring charges, net     of tax                             641           -     1,696          -                                    -------     -------   -------    -------    Non-GAAP net income             $12,196     $22,142   $22,489    $44,471                                    =======     =======   =======    =======    Earnings per share: (GAAP)        Basic                         $0.18       $0.33     $0.32      $0.65        Diluted                       $0.18       $0.33     $0.32      $0.65    Earnings per share: (Non-GAAP)        Basic                         $0.19       $0.33     $0.35      $0.65        Diluted                       $0.19       $0.33     $0.34      $0.65    Weighted average shares used     in calculating earnings     per share:        Basic                        65,018      67,541     65,057    68,436        Diluted                      65,197      67,714     65,315    68,672                   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,                                       2009     2008      2009       2008                                       ----     ----      ----       ----    Net sales                       $481,802  $682,416  $978,569  $1,366,725    Cost of sales                    447,248   636,516   912,379   1,275,737                                     -------   -------   -------   ---------         Gross profit                 34,554    45,900    66,190      90,988    Selling, general and     administrative expenses          21,184    23,393    41,518      47,399    Restructuring charges              1,017         -     2,147           -                                       -----    ------     -----      ------         Income from operations       12,353    22,507    22,525      43,589    Other income (expense):       Interest income                   489     1,986     1,328       5,229       Interest expense                 (350)     (359)     (701)       (724)       Other                               1       709      (395)      2,337                                         ---     -----     -----       -----    Total other income, net              140     2,336       232       6,842                                         ---     -----     -----       -----         Income before income taxes   12,493    24,843    22,757      50,431    Income tax expense                   938     2,701     1,964       5,960                                         ---     -----     -----       -----         Net income                  $11,555   $22,142   $20,793     $44,471                                     =======   =======   =======     =======    Denominator for basic     earnings per share -     weighted average number of     common shares outstanding     during the period                65,018    67,541    65,057      68,436    Incremental common shares     attributable to restricted     shares and the exercise of     outstanding equity     instruments                         179       173       258         236                                         ---       ---       ---         ---    Denominator for diluted     earnings per share               65,197    67,714    65,315      68,672                                      ======    ======    ======      ======    Earnings per share:         Basic                         $0.18     $0.33     $0.32       $0.65                                       =====     =====     =====       =====         Diluted                       $0.18     $0.33     $0.32       $0.65                                       =====     =====     =====       =====    The results for the three and six months ended June 30, 2008 reflect an    immaterial correction of the Company\'s prior period financial statements    related to stock-based compensation expense.                  Benchmark Electronics, Inc. and Subsidiaries                       Condensed Consolidated Balance Sheet                                   June 30, 2009                              (Amounts in Thousands)                                    (UNAUDITED)    Assets    Current assets:       Cash and cash-equivalents                              $403,760       Accounts receivable, net                                350,474       Inventories, net                                        322,220       Other current assets                                     44,717                                                                ------          Total current assets                               1,121,171    Long-term investments                                       48,394    Property, plant and equipment, net                         132,517    Other assets, net                                           63,099    Goodwill, net                                               37,912                                                                ------          Total assets                                      $1,403,093                                                            ==========    Liabilities and Shareholders\' Equity    Current liabilities:       Current installments of capital lease obligations          $273       Accounts payable                                        229,164       Accrued liabilities                                      53,210                                                                ------          Total current liabilities                            282,647    Capital lease obligations, less current installments        11,537    Other long-term liabilities                                 29,956    Shareholders\' equity                                     1,078,953                                                             ---------          Total liabilities and shareholders\' equity        $1,403,093                                                            ==========
Source: PRNewsWire

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