Exhibit 99.1
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ELLEN M. SYKORA |
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INVESTOR RELATIONS |
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April 24, 2007 |
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(979) 849-6550 |
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ANGLETON, TX, APRIL 24, 2007 Benchmark Electronics, Inc. (NYSE: BHE), a leading contract manufacturing provider, announced sales of $752 million for the quarter ended March 31, 2007, compared to $651 million for the same quarter in the prior year. First quarter net income was $24.5 million, or $0.34 per diluted share. In the comparable period of 2006, net income was $26.5 million, or $0.41 per diluted share. Excluding restructuring charges, integration costs, amortization of intangibles and the impact of stock-based compensation costs, the Company would have reported net income of $27.9 million, or $0.39 per diluted share, in the first quarter of 2007. Excluding restructuring charges, the impact of stock-based compensation costs and a tax benefit resulting from the closure of our UK facility, the Company would have reported net income of $24.7 million, or $0.38 per diluted share, in the first quarter of 2006.
Benchmark Electronics, Inc. continues to have solid performance, said Cary T. Fu, the Companys Chief Executive Officer. We saw strong booking performance in the first quarter derived from both existing and new customers. Challenges during the first half of 2007 are seen with the softer market conditions and the ongoing customer initiatives focused on reducing inventory levels. However, we have seen excellent growth opportunities with our new bookings and new product initiatives with several customers and are optimistic that we will see steady improvement in business conditions as the year progresses.
· Operating margin for the first quarter was 3.6% on a GAAP basis and was 4.2%, excluding restructuring charges, integration costs, amortization of intangibles and the impact of stock-based compensation expense.
· Cash flows provided by operating activities for the first quarter were approximately $95 million.
· Cash and short-term investments balance at March 31, 2007 of $257 million.
· Total debt outstanding of $23 million.
· Accounts receivable balance at March 31, 2007 of $512 million; calculated days sales outstanding were 61 days.
· Inventory of $464 million at March 31, 2007; inventory turns were 6.0 times.
Second Quarter 2007 Guidance
Sales for the second quarter of 2007 are expected to be between $740 million and $775 million. Diluted earnings per share for the second quarter, excluding restructuring charges, integration costs, amortization of intangibles and the impact of stock-based compensation expense, are expected to be between $0.36 and $0.41.
Non-GAAP Financial Measures
This press release includes financial measures for earnings and earnings per share that excludes 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 companys 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.
Non-GAAP information 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. Such forward-looking statements may be deemed to include, among other things, statements, express or implied, concerning: future operating results or the ability to generate sales, income or cash flow; Benchmarks business and growth strategies, including expected internal growth and performance goals; and the anticipated effects of any developments or events on financial results. 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 Benchmarks Form 10-K for the year ended December 31, 2006, in its other filings with the Securities and Exchange Commission and in its press releases.
Additional Information
Benchmark Electronics, Inc. is in the business of manufacturing electronics and provides its 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. Benchmarks global operations include 24 facilities in nine countries. Benchmarks 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.
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Benchmark Electronics, Inc. and Subsidiaries
Reconciliation of
GAAP to Non-GAAP Financial Results
Three Months Ended March 31, 2007 and 2006
(Amounts in Thousands, Except Per Share Data)
(UNAUDITED)
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Three Months Ended |
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March 31, |
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2007 |
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2006 |
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Income from operations (GAAP) |
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$ |
27,448 |
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$ |
26,227 |
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Stock-based compensation |
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628 |
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486 |
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Restructuring charges and integration costs |
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3,345 |
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2,769 |
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Amortization of intangibles |
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447 |
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Non-GAAP income from operations |
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$ |
31,868 |
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$ |
29,482 |
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Net income (GAAP) |
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$ |
24,476 |
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$ |
26,522 |
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Stock-based compensation, net of tax |
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442 |
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372 |
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Restructuring charges and integration costs, net of tax |
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2,617 |
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2,553 |
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Amortization of intangibles, net of tax |
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322 |
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UK investment tax benefit |
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(4,760 |
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Non-GAAP net income |
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$ |
27,857 |
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$ |
24,687 |
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Numerator for basic earnings per share - net income (GAAP) |
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$ |
24,476 |
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$ |
26,522 |
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Interest expense on convertible debt, net of tax |
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115 |
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Numerator for diluted earnings per share (GAAP) |
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$ |
24,591 |
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$ |
26,522 |
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Earnings per share: (GAAP) |
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Basic |
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$ |
0.34 |
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$ |
0.42 |
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Diluted |
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$ |
0.34 |
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$ |
0.41 |
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Numerator for basic earnings per share - net income (Non-GAAP) |
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$ |
27,857 |
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$ |
24,687 |
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Interest expense on convertible debt, net of tax |
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115 |
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Numerator for diluted earnings per share (Non-GAAP) |
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$ |
27,972 |
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$ |
24,687 |
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Earnings per share: (Non-GAAP) |
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Basic |
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$ |
0.39 |
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$ |
0.39 |
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Diluted |
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$ |
0.39 |
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$ |
0.38 |
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Weighted average shares used in calculating |
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earnings per share: |
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Basic |
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71,435 |
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63,601 |
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Diluted |
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72,465 |
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64,825 |
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Benchmark Electronics, Inc. and Subsidiaries
Consolidated Statements
of Income
(Amounts in Thousands, Except Per Share Data)
(UNAUDITED)
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Three Months Ended |
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2007 |
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2006 |
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Net sales |
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$ |
752,482 |
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$ |
651,244 |
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Cost of sales |
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697,994 |
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605,878 |
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Gross profit |
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54,488 |
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45,366 |
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Selling, general and administrative expenses |
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23,248 |
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16,370 |
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Amortization of intangibles |
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447 |
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Restructuring charges and integration costs |
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3,345 |
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2,769 |
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Income from operations |
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27,448 |
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26,227 |
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Other income (expense): |
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Interest expense |
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(811 |
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(86 |
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Other |
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1,715 |
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1,689 |
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Total other income, net |
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904 |
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1,603 |
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Income before income taxes |
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28,352 |
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27,830 |
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Income tax expense |
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3,876 |
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1,308 |
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Net income |
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$ |
24,476 |
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$ |
26,522 |
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Numerator for basic earnings per share - net income |
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$ |
24,476 |
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26,522 |
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Interest expense on convertible debt, net of tax |
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115 |
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Numerator for diluted earnings per share |
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$ |
24,591 |
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$ |
26,522 |
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Denominator for basic earnings per share - weighted average number of common shares outstanding during the period |
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71,435 |
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63,601 |
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Incremental common shares attributable to exercise of outstanding equity instruments |
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1,030 |
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1,224 |
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Denominator for diluted earnings per share |
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72,465 |
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64,825 |
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Earnings per share: |
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Basic |
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$ |
0.34 |
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$ |
0.42 |
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Diluted |
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$ |
0.34 |
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$ |
0.41 |
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Benchmark Electronics, Inc. and Subsidiaries
Condensed Consolidated Balance Sheet
March 31, 2007
(Amounts in Thousands)
(UNAUDITED)
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Assets |
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Current assets: |
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Cash and cash-equivalents |
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$ |
151,570 |
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Short-term investments |
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105,660 |
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Accounts receivable, net |
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512,464 |
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Inventories, net |
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463,528 |
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Other current assets |
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91,851 |
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Total current assets |
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1,325,073 |
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Property, plant and equipment, net |
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163,073 |
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Other assets, net |
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28,292 |
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Goodwill, net |
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297,778 |
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Total assets |
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$ |
1,814,216 |
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Liabilities and Shareholders Equity |
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Current liabilities: |
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Current installments of long-term debt and capital lease obligations |
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$ |
5,816 |
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Convertible debt |
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5,000 |
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Accounts payable |
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416,873 |
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Other current liabilities |
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111,913 |
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Total current liabilities |
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539,602 |
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Long-term debt and capital lease obligations, less current installments |
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12,581 |
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Other long-term liabilities |
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14,167 |
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Shareholders equity |
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1,247,866 |
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Total liabilities and shareholders equity |
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$ |
1,814,216 |
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