Flextronics International Ltd, 8-K, 07/24/03

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FUX9TYguU6VlfpXD8p62GTm0eIUbt/Gxrcgj5WDi3pjtnBiMdXVWw+3CLe7Z+OvE WIrm9GlgNty1RsYheBw7tQ== 0000891618-03-003866.txt : 20030724 0000891618-03-003866.hdr.sgml : 20030724 20030724162351 ACCESSION NUMBER: 0000891618-03-003866 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030724 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030724 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FLEXTRONICS INTERNATIONAL LTD CENTRAL INDEX KEY: 0000866374 STANDARD INDUSTRIAL CLASSIFICATION: PRINTED CIRCUIT BOARDS [3672] IRS NUMBER: 000000000 FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-23354 FILM NUMBER: 03801200 BUSINESS ADDRESS: STREET 1: 11 UBI ROAD 1 STREET 2: #07 01 02 MEIBAN INDUSTRIAL BLDG CITY: SINGAPORE STATE: U0 ZIP: 408723 BUSINESS PHONE: 0654495255 FORMER COMPANY: FORMER CONFORMED NAME: FLEX HOLDINGS PTE LTD DATE OF NAME CHANGE: 19940201 8-K 1 f91748e8vk.htm FORM 8-K Flextronics International Ltd, 8-K, 07/24/03

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 24, 2003

FLEXTRONICS INTERNATIONAL LTD.

(Exact Name of Registrant as Specified in Its Charter)

Singapore

(State or Other Jurisdiction of Incorporation)


0-23354		Not Applicable

(Commission File Number)		(IRS Employer Identification No.)


36 Robinson Road, #18-01, City House, Singapore		068877

(Address of Principal Executive Offices)		(Zip Code)

(65) 299-8888

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

TABLE OF CONTENTS


	Item 7. Financial Statements and Exhibits.
	Item 9. Regulation FD Disclosure.
SIGNATURE
EXHIBIT INDEX
EXHIBIT 99.01

Item 7. Financial Statements and Exhibits.


Exhibit No.		Exhibit Title

99.01		Press Release, dated July 24, 2003, issued by Flextronics International Ltd.*

This information shall not be be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, and shall not be deemed incorporated by reference in any filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934 or the Securities Act of 1933, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.

Item 9. Regulation FD Disclosure.

This disclosure is being furnished to report information pursuant to Item 12 — Disclosure of Results of Operations and Financial Condition. On July 24, 2003, Flextronics International Ltd. (the “Company”) issued a press release announcing its results for the first fiscal quarter ended June 30, 2003. A copy of the press release is attached as Exhibit 99.01 to this Current Report.

The press release includes proforma operating results. Proforma operating results are not based on any standardized methodology prescribed by U.S. generally accepted accounting principles (“GAAP”) and are not necessarily comparable to similar measures presented by other companies. Proforma operating results should not be considered in isolation or as a substitute for operating results prepared in accordance with GAAP. The Company has provided a reconciliation of proforma operating results to GAAP in Schedule 1 of the attached press release.

As a result of the significant number of acquisitions made by the Company during the past few years, coupled with an unprecedented downturn in the technology industry and related end market demand for electronics hardware, management believes proforma operating results are a useful measure that facilitates period-to-period operating comparisons. Proforma operating results exclude the effects of the amortization of acquisition-related intangible assets, costs associated with the early extinguishment of debt and restructuring charges related to either the integration of acquisitions or the technology industry downturn. Management uses proforma operating results as a measure of enterprise-wide performance. The Company reports proforma operating results to provide its investors with an alternative method for assessing its operating results in a manner that is focused on what it believes to be its core business operations.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	FLEXTRONICS INTERNATIONAL LTD.

Date: July 24, 2003	By:	/s/ Robert R.B. Dykes

		Robert R. B. Dykes
		President, Systems Group and Chief Financial Officer

EXHIBIT INDEX


Exhibit No.		Exhibit Title

99.01		Press Release, dated July 24, 2003, issued by Flextronics International Ltd.*

EX-99.01 3 f91748exv99w01.txt EXHIBIT 99.01 EXHIBIT 99.01 ________________________________________________________________________________ FLEXTRONICS ________________________________________________________________________________ 2 CHANGI SOUTH LANE TEL: +65.6299.8888 PRESS RELEASE SINGAPORE 486123 ________________________________________________________________________________ FLEXTRONICS CONTACTS: Laurette Slawson Hartigan Vice President Treasurer & Investor Relations +1.408.576.7722 investor_relations@flextronics.com Renee Brotherton Director of Corporate Marketing +1.408.576.7189 renee.brotherton@flextronics.com ________________________________________________________________________________ FLEXTRONICS ANNOUNCES FIRST QUARTER RESULTS SINGAPORE, JULY 24, 2003 - Flextronics International Ltd. (NASDAQ: FLEX) today announced results for the quarter ended June 30, 2003, as follows:
($ in millions, except EPS) (1) QUARTER ENDED -------------------------------- JUNE 30, JUNE 30, 2003 2002 ---------- ---------- Net sales $ 3,106.7 $ 3,127.0 Proforma operating income $ 48.6 $ 52.4 GAAP operating loss $ (278.5) $ (155.4) Proforma net income $ 20.4 $ 30.1 GAAP net loss $ (289.7) $ (131.2) Diluted proforma EPS $ 0.04 $ 0.06 Diluted GAAP EPS $ (0.56) $ (0.25)
(1) Proforma results exclude intangibles amortization, costs associated with the early extinguishment of debt and restructuring charges, as applicable. See Schedule 1 for a reconciliation of proforma results to generally accepted accounting principles ("GAAP") results. Net sales totaled $3.1 billion for the quarter ended June 30, 2003, reflecting a 1.5% sequential increase over the prior quarter sales. Proforma net income was $20.4 million or $0.04 per diluted share, which is down moderately from $25.4 million or $0.05 per diluted share, respectively, in the prior sequential quarter. After including after-tax amortization expense of $7.9 million and unusual charges of $302.2 million, Flextronics incurred a GAAP loss of $289.7 million, which amounts to a $0.56 loss per diluted share. The unusual charges recorded in the June quarter of 2003 includes a $8.7 million after-tax loss on the early retirement of debt and an after-tax restructuring charge of $293.5 million, the cash portion of which is $21.2 million. The restructuring charges include $230.0 million for the closure of two facilities and an asset impairment charge relating to our Multek PCB business. The remaining restructuring charge relates to the closure and consolidation of facilities in our ________________________________________________________________________________ FLEXTRONICS ________________________________________________________________________________ 2 CHANGI SOUTH LANE TEL: +65.6299.8888 PRESS RELEASE SINGAPORE 486123 ________________________________________________________________________________ other business units. In order to optimize the operating efficiencies provided by our global footprint, to reduce the overall risk profile of the Company, and to provide for additional margin upsides in the future, we expect to complete some final optimization of facilities during the remainder of our fiscal year. This strategic decision, combined with additional charges relating to the June quarter restructuring that could not be accrued for in that quarter pursuant to GAAP, will result in recognizing additional restructuring charges over the next few quarters that should total approximately $85 million. The Company strengthened its liquidity again in the June quarter with cash increasing to $860 million and total liquidity reaching $1.7 billion. Cash flow from operations contributed $246 million while the Company continued to lead the industry in working capital management with a cash conversion cycle of 25 days, a one-day improvement over the prior quarter. "The June quarter was very similar to the March quarter with the exception of net interest expense, and to us that demonstrates stability in our business and is in line with our belief that end markets have stabilized as well." said Michael E. Marks, Chief Executive Officer of Flextronics. "Whether an upturn is underway is difficult to know, but in our view demand is slightly improving. Restructuring activities and cost reductions are continuing across the industry, and this should work to improve margins." With regard to the business outlook, Mr. Marks continued to say: "Our business is stable and we continue to generate cash. We have aggressively invested over the last several years to expand our portfolio of value-added services. We are making excellent progress in a number of very important design related initiatives, and we expect to see results from these efforts this fiscal year. Our company is in fine financial shape, and is well respected in the industry and by our customer base." In terms of guidance, the Company indicated that the September quarter should generate sales in the range of $3.3 - $3.5 billion and proforma earnings of $0.06 - $0.08 per share and its expectations for the December quarter are for sales of $3.5 - $3.9 billion, and earnings of $0.11 - $0.15 per share. GAAP earnings are expected to be lower than proforma earnings reflecting approximately 2 cents per diluted share of quarterly amortization expenses as well as the further restructuring charges, which we expect will total approximately $85 million, or 15 cents in total per diluted share, spread over the next few quarters. The actual timing of such charges, and accordingly the actual difference between quarterly proforma and GAAP earnings, has yet to be determined. Mr. Marks concluded by saying, "We are committed to getting back to 20% or more of year over year proforma earnings improvement. We believe that we will achieve those kinds of numbers beginning in the March quarter, and as we move into next fiscal year. If our ODM activities develop as we hope, or if there is a more generalized recovery in the end markets, we should do even better." A conference call hosted by Flextronics' management will be held today at 1:30 p.m. PST to further 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 the Company's website at www.flextronics.com. Additional information in the form of a slide presentation and CEO's Letter that summarizes and discusses the quarterly results may also be found on the site. A replay of the broadcast will remain available on the Company's website after the call. ________________________________________________________________________________ FLEXTRONICS ________________________________________________________________________________ 2 CHANGI SOUTH LANE TEL: +65.6299.8888 PRESS RELEASE SINGAPORE 486123 ________________________________________________________________________________ Minimum requirements to listen to the broadcast are Microsoft Windows Media Player software (free download at http://www.microsoft.com/windows/windowsmedia/download/default.asp) and at least a 28.8 Kbps bandwidth connection to the Internet. ABOUT FLEXTRONICS Headquartered in Singapore, Flextronics is the leading Electronics Manufacturing Services (EMS) provider focused on delivering operational services to technology companies. With fiscal year 2003 revenues of $13.4 billion, Flextronics is a major global operating company with design, engineering, manufacturing and logistics operations in 29 countries and five continents. This global presence allows for manufacturing, excellence through a network of facilities situated in key markets and geographies that provide its customers with the resources, technology, and capacity to optimize their operations. Flextronics' ability to provide end-to-end operational services that include innovative product design, test solutions, manufacturing, IT expertise, network services and logistics has established the Company as the leading EMS provider. For more information, please visit www.flextronics.com. # # # This news release, the CEO's Letter to the Shareholders and the earnings slide presentation contain forward-looking statements within the meaning of federal securities laws and are subject to the safe harbor under those laws. These forward-looking statements include statements related to our future growth, trends in our industry, expected charges and the level of future restructuring requirements, end market demand, expansion of and changes in our client base, our ODM initiative, our anticipated operating results, financial position and profitability. These forward-looking statements involve risks and uncertainties that could cause the actual results to differ materially from those anticipated by these forward-looking statements. These risks include the challenges of effectively managing our operations, particularly during uncertain economic conditions, the need for future restructurings, integrating acquired companies, responding to changes in economic trends and to fluctuations in demand for customers' products and changes in customers' orders, our dependence on a small number of large customers, our dependence on industries affected by rapid technological change, competition in our industry and the other risks described under "Management's Discussion and Analysis of Financial Condition and Results of Operations - Certain Factors Affecting Future Operating Results" in our most recent Annual Report on Form 10-K and quarterly reports on Form 10-Q and current reports on Form 8-K, filed with the SEC. The forward-looking statements in this news release, the Chairman's Letter to the Shareholders and the earnings slide presentation, are based on current expectations, and Flextronics assumes no obligation to update these forward-looking statements. ________________________________________________________________________________ FLEXTRONICS ________________________________________________________________________________ 2 CHANGI SOUTH LANE TEL: +65.6299.8888 PRESS RELEASE SINGAPORE 486123 ________________________________________________________________________________ SCHEDULE 1 FLEXTRONICS INTERNATIONAL LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)
FIRST QUARTER ENDED JUNE 30, 2003 FIRST QUARTER ENDED JUNE 30, 2002 ---------------------------------------- ---------------------------------------- PROFORMA PROFORMA PROFORMA(1) ADJUSTMENTS GAAP PROFORMA(1) ADJUSTMENTS GAAP ----------- ----------- ----------- ----------- ----------- ----------- Net sales $ 3,106,677 $ 3,106,677 $ 3,127,027 $ 3,127,027 Cost of sales 2,941,636 2,941,636 2,959,930 2,959,930 Unusual charges -- 308,835 308,835 -- 179,352 179,352 ----------- ----------- ----------- ----------- ----------- ----------- Gross profit (loss) 165,041 (308,835) (143,794) 167,097 (179,352) (12,255) Selling, general and administrative 116,415 116,415 114,699 114,699 Unusual charges -- 18,273 18,273 -- 28,471 28,471 ----------- ----------- ----------- ----------- ----------- ----------- Operating income (loss) 48,626 (327,108) (278,482) 52,398 (207,823) (155,425) Intangibles amortization -- 8,817 8,817 -- 3,234 3,234 Interest and other expense, net 25,911 25,911 18,999 18,999 Loss on early extinguishment of debt -- 8,695 8,695 -- -- ----------- ----------- ----------- ----------- ----------- ----------- Income (loss) before income taxes 22,715 (344,620) (321,905) 33,399 (211,057) (177,658) Provision for (benefit from) income taxes 2,272 (34,462) (32,190) 3,340 (49,826) (46,486) ----------- ----------- ----------- ----------- ----------- ----------- Net income (loss) $ 20,443 $ (310,158) $ (289,715) $ 30,059 $ (161,231) $ (131,172) =========== =========== =========== =========== =========== =========== Earnings (loss) per share: Basic $ 0.04 $ (0.56) $ 0.06 $ (0.25) =========== =========== =========== =========== Diluted $ 0.04 $ (0.56) $ 0.06 $ (0.25) =========== =========== =========== =========== Shares used in computing per share amounts: Basic 521,100 521,100 515,016 515,016 =========== =========== =========== =========== Diluted 549,995 521,100 524,942 515,016 =========== =========== =========== ===========
(1) Proforma results exclude intangibles amortization, costs associated with the early extinguishment of debt and restructuring charges, as applicable. ________________________________________________________________________________ FLEXTRONICS ________________________________________________________________________________ 2 CHANGI SOUTH LANE TEL: +65.6299.8888 PRESS RELEASE SINGAPORE 486123 ________________________________________________________________________________ SCHEDULE 2 FLEXTRONICS INTERNATIONAL LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS) (UNAUDITED)
JUNE 30, MARCH 31, 2003 2003 ---------- ---------- ASSETS CURRENT ASSETS: Cash and cash equivalents $ 859,751 $ 424,020 Accounts receivable, net 1,496,208 1,417,086 Inventories, net 1,150,573 1,141,559 Deferred income taxes 31,528 29,153 Other current assets 487,560 466,942 ---------- ---------- Total current assets 4,025,620 3,478,760 Property, plant and equipment, net 1,695,647 1,965,729 Deferred income taxes 453,862 415,041 Goodwill and other intangibles, net 2,269,448 2,192,910 Other assets 422,357 341,664 ---------- ---------- Total assets $8,866,934 $8,394,104 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Bank borrowings and current portion of long-term debt $ 53,348 $ 52,484 Current portion of capital lease obligations 5,566 7,622 Accounts payable 1,863,149 1,601,923 Other current liabilities 964,913 918,990 ---------- ---------- Total current liabilities 2,886,976 2,581,019 Long-term debt and capital lease obligations, net of current portion 1,400,087 1,049,853 Other liabilities 233,550 221,212 Shareholders' equity 4,346,321 4,542,020 ---------- ---------- Total liabilities and shareholders' equity $8,866,934 $8,394,104 ========== ==========
-----END PRIVACY-ENHANCED MESSAGE-----

Table of Contents

Table of Contents

Table of Contents

Table of Contents

	(c)		Exhibits.

			The following exhibit is filed herewith: