EX-99.1 2 v191927_ex99-1.htm
Press Release
For More Information, Call:

ELLEN M. DYLLA
  
INVESTOR RELATIONS
July 29, 2010
(979) 849-6550
  

FOR IMMEDIATE RELEASE

BENCHMARK ELECTRONICS REPORTS RESULTS FOR THE
QUARTER ENDED JUNE 30, 2010

ANGLETON, TX, JULY 29, 2010 – Benchmark Electronics, Inc. (NYSE: BHE), a leading contract manufacturing provider, announced sales of $589 million for the quarter ended June 30, 2010, a 22% increase compared to $482 million for the same quarter in the prior year. The Company reported second quarter net income of $21 million, or $0.33 per diluted share. In the comparable period in 2009, the Company reported net income of $12 million, or $0.18 per diluted share. The Company’s net income of $21 million, or $0.33 per diluted share for the second quarter of 2010, represented a 74% increase in earnings per diluted share when compared to $12 million, or $0.19 per diluted share, excluding restructuring charges in the second quarter of 2009. The Company did not report any restructuring charges in the second quarter of 2010.

“Throughout the second quarter we have seen increases in customer demand,” said Cary T. Fu, the Company’s Chief Executive Officer. “The supply chain constraints as well as customer mix changes adversely impacted both revenue and inventory levels for the second quarter.”

Second Quarter 2010 Financial Highlights
 
 
·
Operating margin for the second quarter was 4.0%.
 
·
Cash flows used by operating activities for the second quarter were approximately $24 million.
 
·
Cash and long-term investments balance was $397 million at June 30, 2010. Long-term investments consist of $46 million of auction rate securities.
 
·
Accounts receivable was $413 million at June 30, 2010; calculated days sales outstanding were 63 days.
 
·
Inventory was $389 million at June 30, 2010; inventory turns were 5.6 times.
 
·
Repurchases of common shares for the second quarter totaled $15 million or 0.8 million shares.
 
 
 
 
 
Industry Sectors
The following table sets forth sales by industry sector for the quarter ended June 30, 2010 and March 31, 2010.
 
   
June 30,
    
March 31,
  
   
2010
    
2010
  
Computers and related products for business enterprises
     31 %     32 %
Telecommunications equipment
     23 %     23 %
Industrial control equipment
     25 %     24 %
Medical devices
     10 %     12 %
Testing and instrumentation products
     11 %     9 %

Third Quarter 2010 Outlook
Sales for the third quarter of 2010 are expected to range from $590 million to $630 million. Diluted earnings per share for the third quarter, excluding restructuring charges, are expected to be between $0.33 and $0.36.
 

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 2010, 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. 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, 2009, in its other filings with the Securities and Exchange Commission and in its press releases.

Additional Information
Benchmark Electronics, Inc. provides integrated 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 23 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,
  
   
2010
    
2009
    
2010
    
2009
  
                         
Income from operations (GAAP)
   $ 23,862     $ 12,353     $ 44,994     $ 22,525  
Restructuring charges
     —       1,017       1,697       2,147  
Non-GAAP income from operations
   $ 23,862     $ 13,370     $ 46,691     $ 24,672  
                                 
Net income (GAAP)
   $ 20,777     $ 11,555     $ 39,027     $ 20,793  
Restructuring charges, net of tax
     —       641       847       1,696  
Non-GAAP net income
   $ 20,777     $ 12,196     $ 39,874     $ 22,489  
                                 
Earnings per share: (GAAP)
                                
Basic
   $ 0.33     $ 0.18     $ 0.62     $ 0.32  
Diluted
   $ 0.33     $ 0.18     $ 0.61     $ 0.32  
                                 
Earnings per share: (Non-GAAP)
                                
Basic
   $ 0.33     $ 0.19     $ 0.63     $ 0.35  
Diluted
   $ 0.33     $ 0.19     $ 0.63     $ 0.34  
                                 
Weighted average shares used in calculating  earnings per share:
                                
Basic
     62,695       65,018       63,047       65,057  
Diluted
     63,243       65,197       63,598       65,315  
 
 
 
 

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,
  
   
2010
    
2009
    
2010
    
2009
  
                         
Net sales
   $ 589,449     $ 481,802     $ 1,161,354     $ 978,569  
Cost of sales
     542,555       447,248       1,069,115       912,379  
                                 
Gross profit
     46,894       34,554       92,239       66,190  
                                 
Selling, general and administrative expenses
     23,032       21,184       45,548       41,518  
Restructuring charges
     —       1,017       1,697       2,147  
                                 
Income from operations
     23,862       12,353       44,994       22,525  
                                 
Other income (expense):
                                
Interest income
     447       489       814       1,328  
Interest expense
     (340 )     (350 )     (679 )     (701 )
Other
     (679 )     1       (1,050 )     (395 )
Total other income (expense), net
     (572 )     140       (915 )     232  
                                 
Income before income taxes
     23,290       12,493       44,079       22,757  
                                 
Income tax expense
     2,513       938       5,052       1,964  
                                 
Net income
   $ 20,777     $ 11,555     $ 39,027     $ 20,793  
                                 
Denominator for basic earnings per share - weighted average number of common shares outstanding during the period
     62,695       65,018       63,047       65,057  
Incremental common shares attributable to restricted shares and the exercise of outstanding equity instruments
     548       179       551       258  
Denominator for diluted earnings per share
     63,243       65,197       63,598       65,315  
                                 
Earnings per share:
                                
Basic
   $ 0.33     $ 0.18     $ 0.62     $ 0.32  
Diluted
   $ 0.33     $ 0.18     $ 0.61     $ 0.32  
 
 
 
 

Benchmark Electronics, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet
June 30, 2010
(Amounts in Thousands)
(UNAUDITED)

Assets
      
       
Current assets:
      
Cash and cash-equivalents
   $ 351,477  
Accounts receivable, net
     413,448  
Inventories, net
     389,023  
Other current assets
     48,672  
Total current assets
     1,202,620  
         
Long-term investments
     45,559  
Property, plant and equipment, net
     127,105  
Other assets, net
     57,820  
Goodwill, net
     37,912  
Total assets
   $ 1,471,016  
         
Liabilities and Shareholders’ Equity
        
         
Current liabilities:
        
Current installments of capital lease obligations
   $ 333  
Accounts payable
     281,494  
Accrued liabilities
     57,397  
Total current liabilities
     339,224  
         
Capital lease obligations, less current installments
     11,202  
Other long-term liabilities
     25,168  
Shareholders’ equity
     1,095,422  
Total liabilities and shareholders’ equity
   $ 1,471,016