-----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, RTyyDkqMfrrRRD29xyMldmWfg6j5d+Zyi7aJh2K8988Z+wARXI3cqXet91vUlvX+ EqnsdqTo1OQMH09FC4QqQQ== 0000950124-96-000404.txt : 19960201 0000950124-96-000404.hdr.sgml : 19960201 ACCESSION NUMBER: 0000950124-96-000404 CONFORMED SUBMISSION TYPE: 10-K405/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19960131 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: PLEXUS CORP CENTRAL INDEX KEY: 0000785786 STANDARD INDUSTRIAL CLASSIFICATION: PRINTED CIRCUIT BOARDS [3672] IRS NUMBER: 391344447 STATE OF INCORPORATION: WI FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-K405/A SEC ACT: SEC FILE NUMBER: 000-14824 FILM NUMBER: 96509278 BUSINESS ADDRESS: STREET 1: 55 JEWELERS PARK DR CITY: NEENAH STATE: WI ZIP: 54957-0156 BUSINESS PHONE: 4147223451 MAIL ADDRESS: STREET 1: PLEXUS CORP STREET 2: 55 JEWELERS PARK DR CITY: NEENAH STATE: WI ZIP: 54957-0156 10-K405/A 1 10K 405/A 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K/A AMENDMENT NO. 1 (Mark One) X ----- ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1995 OR ----- TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 0-14824 PLEXUS CORP. (Exact name of registrant as specified in its charter) WISCONSIN 39-1344447 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 55 JEWELERS PARK DRIVE, NEENAH, WISCONSIN 54957-0156 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (414) 722-3451 Securities registered pursuant to Section 12(b) of the Act: NONE Securities registered pursuant to Section 12(g) of the Act: COMMON STOCK, $.01 PAR VALUE (Title of Class) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such report(s)) and (2) has been subject to such filing requirements for the past 90 days. Yes X No ------ ------ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] As of December 12, 1995, 6,493,897 shares of Common Stock were outstanding, and the aggregate market value of the shares of Common Stock (based upon the $16.375 closing sale price on the last trading date prior thereto, as reported on the NASDAQ National Market System) held by non-affiliates (excludes shares reported as beneficially owned by directors and officers - does not constitute an admission as to affiliate status) was approximately $92.6 million. DOCUMENTS INCORPORATED BY REFERENCE PART OF FORM 10-K INTO WHICH PORTIONS OF DOCUMENT DOCUMENT ARE INCORPORATED -------- ------------------------- Annual Report to Shareholders for the fiscal year ended September 30, 1995 Part II Proxy Statement for 1996 Annual Meeting of Shareholders Part III 2 PORTION AMENDED: Exhibit 13 Annual Report to Shareholders for the fiscal year ended September 30, 1995 * * * * * SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Amendment No. 1 to the report to be signed on its behalf by the undersigned, thereunto duly authorized. January 31, 1996 PLEXUS CORP. By /s/ JOSEPH D. KAUFMAN (Registrant) Joseph D. Kaufman, Vice President, General Counsel and Corporate Secretary EX-13 2 ANNUAL REPORT 1 1995 ANNUAL REPORT [PLEXUS LOGO] 2 PLEXUS designs, develops, manufactures, & tests BUSINESS DESCRIPTION Plexus, a product development company, was formed in 1980. The unique concept underlying the formation of Plexus was that of providing all aspects of electronic product development, including production and test, to other companies. Plexus' headquarters and both of its subsidiaries are located in Neenah, Wisconsin. One subsidiary is Plexus Technology Group, Inc. (TGI), which is comprised of the engineering staff and product development facilities. The other subsidiary is Plexus Electronic Assembly Corporation (EAC), which is comprised of the manufacturing staff and production facilities. Plexus also has an EAC manufacturing facility in Richmond, Kentucky. Plexus Corp., through its subsidiaries, designs, manufactures and tests a variety of electronic products for major corporations on an international basis. The Company has no proprietary products, but its designs are used in a variety of fields, including computer, medical, industrial, communications, consumer and automotive. Because of its commitment to quality, the Company utilizes the latest equipment, tools and methods in engineering and manufacturing. This ensures that its customers are receiving the most up-to-date technology available to create a quality, cost-effective product.
TABLE OF CONTENTS Financial Highlights................................ 1 Letter to Shareholders.............................. 2 Business Review .................................... 4 Management's Discussion and Analysis................ 9 Consolidated Financial Statements .................. 11 Shareholder Information ............................ 20
3 FINANCIAL HIGHLIGHTS (in thousands, except share and per share amounts)
(in thousands, except share and per share amounts) OPERATING STATEMENT DATA 1995 1994 1993 1992 1991 Sales $283,134 $242,483 $159,597 $157,376 $120,434 Cost of sales 259,438 226,313 146,523 140,681 107,102 - -------------------------------------------------------------------------------------------------------------- Gross profit 23,696 16,170 13,074 16,695 13,332 Operating expenses 11,261 8,244 6,764 6,968 5,806 - -------------------------------------------------------------------------------------------------------------- Operating income 12,435 7,926 6,310 9,727 7,526 Other expenses 2,153 2,996 2,180 1,517 1,772 - -------------------------------------------------------------------------------------------------------------- Income before income tax 10,282 4,930 4,130 8,210 5,754 Income tax 3,939 1,873 1,560 3,160 2,115 ============================================================================================================== Net income $ 6,343 $ 3,057 $ 2,570 $ 5,050 $ 3,639 ============================================================================================================== Net income per common share $ .89 $ .46 $ .40 $ .80 $ .59 ============================================================================================================== Cash dividends per common share $ - $ - $ - $ - $ - ============================================================================================================== BALANCE SHEET DATA Working capital $ 71,302 $ 62,784 $ 45,169 $ 31,370 $ 23,442 Total assets 115,088 122,021 95,149 62,689 54,529 Long-term debt 41,734 40,691 40,064 20,461 19,729 Stockholders' equity 41,009 34,879 24,801 23,130 16,603
Net Sales ($ in millions) [bar graph] Net Income ($ in millions) [bar graph] Net Income Per Share (in dollars) [bar graph] Plexus Corp. 1 1995 Annual Report 4 LETTER TO SHAREHOLDERS [Photo of Peter Strandwitz] PETER STRANDWITZ, CHAIRMAN AND CHIEF EXECUTIVE OFFICER TO OUR SHAREHOLDERS Sales increased 17% in fiscal 1995 and net income increased 107%. This is a reversal from 1994 in which sales increased much more than earnings (52% versus 19%). I believe that this reversal demonstrates that the Company is very serious about improving its operating efficiencies, attaining better margins, and fully controlling its inventory. Both the sales and earnings were records for the Company. As everyone knows, the world of electronics is expanding at a dazzling pace. Technologies are changing and improving constantly. New alliances are announced daily. As a result of this, a worldwide shortage of electronic components exists that is expected to continue for several years. Semiconductor manufacturers in particular are allocating product to a limited number of customers. In order to cope in this dynamic environment, Plexus formed and staffed a corporate procurement organization in 1995 whose primary purpose is to create very strong supplier alliances to assure a flow of component parts at the best prices. In 1995 the Company also strengthened its banking relationships with the addition of two more major banks to its banking consortium. Strong financial relationships are essential in order for Plexus to grow substantially in 1996 and beyond. The Company is also actively investigating other relationships of a strategic nature. Plexus' product development, manufacturing and test technologies remain outstanding and are continuing to attract a great deal of interest from major corporations. Although we do not expect any improvement in the first quarter of fiscal 1996, because of product start-ups and delays, we believe that 1996 will develop into a rewarding year and that overall results will be much better than fiscal 1995. Very truly yours, Peter Strandwitz PETER STRANDWITZ Chairman and Chief Executive Officer Plexus Corp. Plexus Corp. 2 1995 Annual Report 5 [Picture of Building] 6 PRODUCT DEVELOPMENT Global competition has made the fast track even faster. Every industry -- from cars to computers -- is feeling the pressure to speed up product development. Customer needs are quickly changing, product life cycles are getting shorter, and "time-to-market" has become as much a competitive requirement as quality and price. Companies that cannot adjust to this accelerated pace soon fall behind or drop out of the race. Success in product development is a critical issue for technology-driven companies. In today's highly competitive global environment, success most often depends on being the first to develop and introduce new products. Plexus provides all of these services in a cost-effective manner. IT PROVIDES A DYNAMIC ENVIRONMENT OFFERING "ONE-STOP SHOPPING", FROM PRODUCT CONCEPT THROUGH MANUFACTURING... A PRODUCT DEVELOPMENT PARTNER Plexus Technology Group, Inc. is a full-service product development partner. It provides a dynamic environment offering "one-stop shopping", from product concept through manufacturing, or the ability to handle any segment of that process. At Plexus Technology Group, projects are handled by engineers with a business sense that supplements technical expertise. Each customer is given the highest priority. New products require several diverse in-house engineering capabilities, including software, analog, digital, mechanical, PCB, functional test and in-circuit test. The capital expenditures and the associated fixed costs for a product development effort are often beyond the means of even well-established and profitable businesses. Because Plexus Technology Group develops many products concurrently, it can maintain a higher level of efficiency and a greater utilization of capital equipment. [Picture of Plexus Corp. Headquarters] Plexus Corp. Headquarters in Neenah, Wis. Plexus Corp. 4 1995 Annual Report 7 PRODUCT DEVELOPMENT Most companies admit to having a difficult time controlling development projects. Because of the relatively small economies of scale and expensive expertise needed at each phase, it can be difficult for a single company to support the full chain of product development activities in-house. Plexus Technology Group provides improved time-to-market and competitive product costs through employment of expert project management. [Picture of woman and two men at table] OUR STAFF BRINGS A WIDE VARIETY OF EXPERIENCE AND EXPERTISE TO THE TABLE. HIRING PERSONNEL WITH OUTSTANDING EDUCATIONAL AND/OR INDUSTRY CREDENTIALS HAS BEEN ONE OF PLEXUS TECHNOLOGY GROUP'S MOST IMPORTANT GOALS. TOP LEVEL PERSONNEL High-tech product development requires many different types of expertise. Hiring personnel with outstanding educational and/or industry credentials has been one of Plexus Technology Group's most important goals. Producing leading edge products requires the joint and lengthy effort of a team of experts. Plexus employs a range of specialists with different skills who are called upon as needed during different phases of a project. The staff includes project managers, electronics hardware engineers, mechanical engineers, software engineers, manufacturing engineers, assembly/quality assurance personnel, and so forth. Plexus has a broad range of equipment and expertise. Since it is never known for certain what the next project might be, Plexus has to be completely up-to-date and maintain a broad knowledge of current technologies. Those who rely on Plexus often dominate fast-changing markets. Plexus Corp. 5 1995 Annual Report 8 MANUFACTURING & TEST SERVICES Plexus is committed to making the investments required to maintain and strengthen its position as a world class provider of design, test and manufacturing services. Our success, and the success of our customers, depends upon our ability to provide the highest levels of technology to our customers. [Picture of Plexus Manufacturing Site] PLEXUS MANUFACTURING SITE, NEENAH, WIS. We continue to be committed to providing these services at costs that are competitive worldwide. Our efforts are focused on maintaining our technological edge while keeping costs down. Our structure is constantly being streamlined to assure that it is cost effective. From the beginning, we have understood the value of leveraging the information available from our key suppliers, and have used these suppliers as a means to bring on new technology. Plexus has formed partnerships with leading providers of assembly equipment, test equipment and design automation tools. Through these partnerships, Plexus offers world-class capabilities. TESTING...A KEY CONSIDERATION THROUGHOUT THE DEVELOPMENT PROCESS OUR EFFORTS ARE FOCUSED ON MAINTAINING OUR TECHNOLOGICAL EDGE WHILE KEEPING COSTS DOWN. Plexus has continued to maintain its leadership position in the area of Test Technology with many additions to our suite of tools and processes. During 1995 Plexus added new state-of-the-art X-Ray Laminography capabilities which allow for inspection and testing of advanced packaging and manufacturing technologies. Plexus has also upgraded its Combinational Test capabilities with the addition of high node count test systems. These systems allow Plexus to conduct Combinational test (both [Picture of Manufacturing Facility Interior] BY STRENGTHENING PARTNERSHIPS WITH KEY SUPPLIERS, PLEXUS IS ABLE TO OFFER THE MOST CURRENT TECHNOLOGY AT A VERY COMPETITIVE COST. Plexus Corp. 6 1995 Annual Report 9 MANUFACTURING & TEST SERVICES in-circuit and functional) on assemblies with greater than 5,000 nodes. The addition of these tools provides Plexus with the test and inspection capabilities required by our customers with complex assemblies. The information we collect on each test is available to the customer in a variety of formats. Not only are we able to offer high quality test solutions, we can provide the data necessary to drive continuous quality improvement and cost reduction. A DEDICATION TO LONG-LASTING CUSTOMER RELATIONSHIPS There are several reasons for choosing a product development and manufacturing partner. Most companies realize valuable market share can be gained by reducing time-to-market. Some feel they have better ways to utilize their capital than adding buildings, equipment and staff. Still others, pressured by downsizing, have engineering and manufacturing departments that are over-burdened or have not been able to keep pace with technology. New technologies often dictate outsourcing product development. CUSTOMERS CAN DEPEND ON PLEXUS TO BE A RELIABLE AND RESOURCEFUL SINGLE-SOURCE PARTNER. [Picture of Technician in an office] PLEXUS MAINTAINS ITS LEADERSHIP POSITION IN TESTING COMPLEX ASSEMBLIES BY CONTINUALLY INVESTING IN THE LATEST TEST TECHNOLOGY. For many, creating a "strategic partnership" becomes the conclusion to their thoughts about outsourcing. In forming a strategic partnership, a company seeks to outsource a critical activity to a non-competing company that can perform it as effectively or possibly more effectively. Whatever the reason, customers can depend on Plexus to be a reliable and resourceful single source partner. We fully understand that trust and confidentiality are essential elements in a strategic partnership. Plexus Corp. 7 1995 Annual Report 10 STRATEGIC PARTNERSHIPS The most successful alternative to in-house product development is forming a strategic partnership with a company that can manage product development, and also manufacture and test the product on a turnkey basis. SINCE PLEXUS HAS NO PROPRIETARY PRODUCTS, CUSTOMERS RECEIVE OUR TOTAL ATTENTION. OUR SOLE PRODUCT IS OUR SERVICES. Plexus is committed to providing whatever is necessary to assure that the development, manufacturing and testing of our customers' products occurs in a timely and cost effective manner. This helps our partners gain market share in some of the world's most competitive industries. Since Plexus has no proprietary products, customers receive our total attention. Our sole product is our services. PLEXUS OFFERS YEARS OF PRODUCT DEVELOPMENT AND MANUFACTURING EXPERIENCE In order to stay on the leading edge of electronic product development, Plexus has experts on staff to anticipate future demands for new engineering, test and manufacturing technologies, so these technologies are available when needed by our customers. This staff is available to our customer base to consult on technology issues and to help customers with the outsourcing transition. At Plexus, we understand the pitfalls associated with bringing a new product to market. Our design and manufacturing staffs have the knowledge and experience to help minimize the risks in a cost-effective manner. As a turnkey product development and/or manufacturing partner, Plexus will do whatever it takes to meet customer requirements. Forward-thinking companies are choosing Plexus as their product development and manufacturing partner. At Plexus, we provide solutions today for tomorrow's complex electronic challenges. [Picture of Man at Computer Terminal] OUR ENGINEERING STAFF IS EQUIPPED WITH THE LATEST SOFTWARE AND COMPUTER TECHNOLOGY TO ENSURE A TIMELY, FLEXIBLE DEVELOPMENT PROCESS. Plexus Corp. 8 1995 Annual Report 11 MANAGEMENT'S DISCUSSION AND ANALYSIS of Financial Condition and Results of Operations YEAR ENDED SEPTEMBER 30, 1995 COMPARED TO YEAR ENDED SEPTEMBER 30, 1994 Net sales for the fiscal year ended September 30, 1995 increased $40,651,000 or 16.7% to $283,134,000 from $242,483,000 for the fiscal year ended September 30, 1994. After a slow first quarter, volume increased steadily during fiscal year 1995, due to an increased customer base. Management believes that these new strategic relationships are a result of the Company's investment and development of its outstanding technology package and facilities. The Company will continue to be selective in the enlargement of its customer base, seeking market leaders that want to develop a long-term relationship. A portion of this increase continues to be sales allocable to component parts used in assemblies ("parts sales") as distinguished from sales allocable to services; parts sales tend to have lower margins to the Company than services sales. Cost of sales for the fiscal year ended September 30, 1995 increased $33,125,000 or 14.6% to $259,438,000 from $226,313,000 for the fiscal year ended September 30, 1994. The increase in cost of sales results from the increased level of sales and from those costs associated with increased parts sales. Increased utilization of the Advanced Manufacturing Center and more efficient use of capacity in the other plants enabled gross profit to increase $7,526,000 or 46.5% for the fiscal year ended September 30, 1995 to $23,696,000 from $16,170,000 for the fiscal year ended September 30, 1994. Gross profit margin as a percentage of sales increased to 8.4% from 6.7%. Selling and administrative expenses for the fiscal year ended September 30, 1995 increased $3,017,000 to $11,261,000 from $8,244,000 for the fiscal year ended September 30, 1994. This increase is due to management's decision to improve customer service, data collection, and information systems with additional staffing. The Company also incurred larger than normal expenditures during the fourth quarter of the fiscal year for group health, employee procurement, supplies, customer relations, and charitable donations. These events caused an increase in selling and administrative expenses to 4.0% for fiscal 1995 as a percentage of net sales compared to 3.4% for fiscal 1994. Interest expense decreased $682,000 for the fiscal year ended September 30, 1995 to $2,470,000 from $3,152,000 for the fiscal year ended September 30, 1994. This decrease is due to decreases in the amount of average daily borrowings on the Company's line of credit related to working capital requirements in the latter half of the fiscal year and decreases in interest rates. Miscellaneous income of $317,000 for fiscal year 1995 compared to miscellaneous income of $156,000 was due to increased amount of charges billed back to customers covering inventory carrying costs, and the one-time effect of a write-off in fiscal 1994. Income taxes increased $2,066,000 for the fiscal year ended September 30, 1995 to $3,939,000 from $1,873,000 for the fiscal year ended September 30, 1994. This increase is due to the increased level of pretax profits. The Company's two largest customers in sales in each of the past several years were International Business Machines Corporation (through up to six subsidiaries or divisions) and General Electric Company (through up to five subsidiaries or divisions). Each of the entities contracts independently of the others, and the Company does not believe that sales to any of these customers depend upon sales to the others. In fiscal 1995, sales to International Business Machines Corporation were reduced due to the termination of several projects relating to IBM product lines, although IBM remains a significant customer. While the loss of all, or a substantial portion of, the business with IBM or General Electric would have a material adverse effect on the Company's sales and profitability, the Company does not believe this to be a likely possibility. The Company expects that its historic dependency on IBM and GE will be further reduced in fiscal 1996 as a percentage of total sales. The Company expects, however, revenue growth in fiscal 1996 from both IBM and GE, as well as from expanded programs for other existing customers and programs from new customers. Substantially all of the Company's business is done on a project by project basis for its customers. Although the Company has several projects and customers for which it provides services on a continuing basis, the timing and nature of particular customer projects can vary significantly from period to period. Substantial changes in the nature or timing of these projects can affect the Company's sales and profitability from period to period. YEAR ENDED SEPTEMBER 30, 1994 COMPARED TO YEAR ENDED SEPTEMBER 30, 1993 During the year ended September 30, 1994, net sales increased $82,886,000 or 52% to $242,483,000 from $159,597,000 for the fiscal year ended September 30, 1993. This increase was made possible due to increased capacity provided by the Company's new Advanced Manufacturing Center which was completed and began operations during the beginning of fiscal year 1994. The largest portion of this increase related to parts sales as distinguished from sales allocable to services. Cost of sales increased $79,790,000 to $226,313,000 for the fiscal year ended September 30, 1994 compared to $146,523,000 for the fiscal year ended September 30, 1993. Approximately 86% of this increase was in the cost of component parts associated with the increase in parts sales, with the balance of the increase arising from other expenses such as labor and related payroll costs due to increase staffing, and fixed manufacturing expenses related to the Advanced Manufacturing Center. As a result of the increased parts sales, increased cost of key component parts especially during the first fiscal quarter resulting from a worldwide shortage of key components (logic and memory devices), increased staffing and fixed manufacturing expenses, gross profit decreased to 6.7% of net sales for the fiscal year ended September 30, 1994 compared to 8.2% of net sales for the fiscal year ended September 30, 1993. However actual gross profit increased 23.6% to $16,170,000 in fiscal 1994 from $13,074,000 for fiscal year 1993 as a result of the increased sales. Plexus Corp. 9 1995 Annual Report 12 MANAGEMENT'S DISCUSSION AND ANALYSIS of Financial Condition and Results of Operations Selling and administrative expenses as a percentage of net sales decreased to 3.4% for the fiscal year ended September 30, 1994 compared to 4.2% of net sales for the fiscal year ended September 30, 1993. Selling and administrative expenses are expected to remain at a level relatively consistent with the fourth quarter of fiscal 1994 as the Company believes it has in place the structure and personnel, with the possible addition of one or two positions, to support increased sales. Other income and expense increased $816,000 to $2,996,000 for the fiscal year ended September 30, 1994 compared to $2,180,000 for the fiscal year ended September 30, 1993. Interest expense increased $1,544,000 to $3,152,000 from $1,608,000 for the fiscal year ended September 30, 1993. The increase in interest expense in fiscal year 1994 is due to increased average daily borrowings on the Company's line of credit related to working capital requirements and also higher interest rates. The Company's increased interest expense on its line of credit was offset in part by the Company's sale and leaseback transaction in late fiscal 1994 as detailed below. Miscellaneous income of $156,000 for fiscal year 1994 compared to miscellaneous expense of $572,000 for fiscal year 1993 primarily relating to write-off of a minority investment and an allocated loss on the Company's investment in Plexus Home Automation Limited Partnership. Income taxes for the fiscal year ended September 30, 1994 increased $313,000 to $1,873,000 primarily due to increased pretax profit. Effective October 1, 1992 the Company adopted Statement of Financial Accounting Standards No. 109 "Accounting for Income Taxes". This change did not have a significant effect on reported net earnings for the fiscal year 1994 or 1993. LIQUIDITY AND CAPITAL RESOURCES As shown in the Company's statements of cash flows, cash increased $2,488,000 during fiscal 1995. This increase is a result of $4,188,000 provided by operations and $387,000 provided by financing activities, offset by $2,087,000 used in investing activities. Net cash provided by operations is a result primarily from net income, non-cash items and improved controls over inventory, offset by decreased accounts payable and increased accounts receivables. Net cash used in investing activities is a result primarily from purchase of equipment. Working capital increased to $71,302,000 at September 30, 1995 from $62,784,000 at September 30, 1994. Accounts receivable increased $3,861,000 because of increased sales volume for the year. Inventories decreased $11,081,000 as a result of improved procurement and materials management initiatives. Management expects to make additional progress on improving cash flow from operations. The Company leases the majority of its machinery and equipment additions under operating lease arrangements. The Company anticipates continued use of lease financing arrangements as a means to finance machinery and equipment. The Company believes that anticipated revenues from operations will be sufficient to fund these obligations for the foreseeable future. The Company has total future commitments of $46,476,000 related to noncancelable operating leases (see Note 7 to the Consolidated Financial Statements); lease payments are included in cost of goods sold. Payment for property, plant and equipment for fiscal 1995, 1994 and 1993 was $2,106,000, $5,288,000, and $8,233,000, respectively. Except for the Advanced Manufacturing Center, these acquisitions were financed from working capital. The Advanced Manufacturing Center was permanently financed by use of a sale and leaseback transaction in August, 1994. Management has currently budgeted capital expenditures in fiscal year 1996 of approximately $8,500,000. The Company's debt-to-equity ratio was 1.8 to 1 at September 30, 1995 and 2.5 to 1 at September 30, 1994. The Company was in compliance with debt-to-equity, and similar ratios, under its debt facilities at both dates. At September 30, 1995, the Company had $41,500,000 outstanding on its Revolving Credit Facility, as compared to $37,100,000 at September 30, 1994. The Company increased this Revolving Credit Facility in July 1995, to permit maximum borrowings of $55,000,000 (increased from $40,000,000) and extended the termination date and final maturity of the existing notes from July 31, 1997 to July 31, 1998. The Company used $3,500,000 of the additional credit to pay off an outstanding $3,500,000 promissory note to a financial institution which it had used to replace certain Industrial Revenue Bond debt. The Company also paid off its $200,000 industrial revenue bond for its Kentucky facility. On October 7, 1993, the Company entered into an interest rate cap agreement which limits the interest rate portion of its floating rate long term debt to 8% or 8.5%, depending on the rate charged in the revolving credit agreement. The agreement has a notional amount of $10,000,000 and expires on October 7, 1996. The Company does not believe that these arrangements create any material exposure to the Company relating to "derivatives" or similar arrangements. The Company has not paid dividends on its common stock, but has reinvested its earnings to support its working capital and expansion requirements. Except for future dividend requirements on the Series A preferred stock, the Company intends to continue to employ its earnings in the development and expansion of the business and does not expect to pay cash dividends in the foreseeable future. The Company believes that its existing credit facilities, leasing capabilities, and projected cash flow from operations will be sufficient to meet its foreseeable short term and long term capital and liquidity needs. Plexus Corp. 10 1995 Annual Report 13 CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEARS ENDED SEPTEMBER 30, 1995, 1994 AND 1993 (in thousands, except per share amounts)
1995 1994 1993 Net sales $283,134 $242,483 $159,597 Cost of sales 259,438 226,313 146,523 - ----------------------------------------------------------------------------------------------- Gross profit 23,696 16,170 13,074 Selling and administrative expenses 11,261 8,244 6,764 - ----------------------------------------------------------------------------------------------- Operating income 12,435 7,926 6,310 - ----------------------------------------------------------------------------------------------- Other income (expense) Interest expense (2,470) (3,152) (1,608) Miscellaneous 317 156 (572) - ----------------------------------------------------------------------------------------------- (2,153) (2,996) (2,180) - ----------------------------------------------------------------------------------------------- 10,282 4,930 4,130 Income taxes 3,939 1,873 1,560 - ----------------------------------------------------------------------------------------------- Net income $ 6,343 $ 3,057 $ 2,570 =============================================================================================== Net income per common and common equivalent share Primary $ .89 $ .46 $ .40 =============================================================================================== Fully diluted $ .88 $ .46 $ .40 ===============================================================================================
The accompanying notes are an integral part of these consolidated financial statements. Plexus Corp. 11 1995 Annual Report 14 CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 1995 AND 1994 (in thousands, except share and per share amounts)
ASSETS 1995 1994 Current assets: Cash $ 3,569 $ 1,081 Accounts receivable, net of allowance of $145 and $130 in 1995 and 1994, respectively 47,560 43,699 Inventories 48,966 60,047 Deferred income taxes 904 743 Prepaid expenses and other 1,930 3,200 - ----------------------------------------------------------------------------------------------------- Total current assets 102,929 108,770 Property, plant and equipment, net 11,829 12,856 Other 330 395 - ----------------------------------------------------------------------------------------------------- Total assets $115,088 $122,021 ===================================================================================================== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 107 $ 550 Accounts payable 23,279 36,891 Customer deposits 3,530 3,501 Accrued liabilities: Salaries and wages 2,618 2,182 Other 2,093 2,862 - ----------------------------------------------------------------------------------------------------- Total current liabilities 31,627 45,986 Long-term debt 41,734 40,691 Deferred income taxes 718 465 Stockholders' equity: Series A preferred stock, $.01 par value, $1,000 face value, 7,000 shares authorized, issued and outstanding -- -- Preferred stock, $.01 par value, 4,993,000 shares authorized, none issued or outstanding -- -- Common stock, $.01 par value, 30,000,000 shares authorized, 6,491,345 and 6,460,498 issued and outstanding, respectively 65 65 Additional paid-in capital 14,160 13,829 Retained earnings 26,784 20,985 - ----------------------------------------------------------------------------------------------------- 41,009 34,879 - ----------------------------------------------------------------------------------------------------- Total liabilities and stockholders' equity $115,088 $122,021 =====================================================================================================
The accompanying notes are an integral part of these consolidated financial statements. Plexus Corp. 12 1995 Annual Report 15 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY FOR THE YEARS ENDED SEPTEMBER 30, 1995, 1994 AND 1993 (in thousands, except share amounts)
Additional Total PREFERRED STOCK COMMON STOCK Paid-in Retained Stockholder's Shares Amount Shares Amount Capital Earnings Equity - --------------------------------------------------------------------------------------------------------------------------------- Balances, September 30, 1992 - $ - 6,448,173 $64 $ 7,708 $15,358 $23,130 Exercise of stock options - - - - (899) - (899) Net income - - - - - 2,570 2,570 - --------------------------------------------------------------------------------------------------------------------------------- Balances, September 30, 1993 - - 6,448,173 64 6,809 17,928 24,801 Exercise of stock options - - 12,325 1 20 - 21 Issuance of Series A Preferred Stock 7,000 - - - 7,000 - 7,000 Net income - - - - - 3,057 3,057 - --------------------------------------------------------------------------------------------------------------------------------- Balances, September 30, 1994 7,000 - 6,460,498 65 13,829 20,985 34,879 Exercise of stock options - - 30,847 - 331 - 331 Net income - - - - - 6,343 6,343 Preferred dividends ($77.69 per share) - - - - - (544) (544) - --------------------------------------------------------------------------------------------------------------------------------- Balances, September 30, 1995 7,000 $ - 6,491,345 $65 $14,160 $26,784 $41,009 =================================================================================================================================
The accompanying notes are an integral part of these consolidated financial statements. Plexus Corp. 13 1995 Annual Report 16 CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED SEPTEMBER 30, 1995, 1994 AND 1993 (in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES 1995 1994 1993 Net income $ 6,343 $ 3,057 $ 2,570 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization 3,237 3,103 2,555 Deferred income taxes 92 (156) (164) Changes in assets and liabilities: Accounts receivable, net (3,861) (22,367) (3,164) Inventories 11,081 (10,599) (19,854) Prepaid expenses and other 1,270 (690) (1,453) Accounts payable (13,612) 12,869 10,251 Customer deposits 29 2,627 (94) Accrued liabilities (333) 860 (332) Other (58) 125 137 - ----------------------------------------------------------------------------------------------------------------- Net cash flows provided by (used in) operating activities 4,188 (11,171) (9,548) - ----------------------------------------------------------------------------------------------------------------- CASH FLOWS FROM INVESTING ACTIVITIES Proceeds on sale of property, plant and equipment 19 9,104 - Payments for property, plant and equipment (2,106) (5,288) (8,233) - ----------------------------------------------------------------------------------------------------------------- Net cash flows provided by (used in) investing activities (2,087) 3,816 (8,233) - ----------------------------------------------------------------------------------------------------------------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from debt 121,900 110,791 137,500 Payments on debt (121,300) (110,219) (119,763) Issuance of preferred stock - 7,000 - Issuance of common stock 331 21 - Payments of preferred dividends (544) - - - ----------------------------------------------------------------------------------------------------------------- Net cash flows provided by financing activities 387 7,593 17,737 - ----------------------------------------------------------------------------------------------------------------- Net increase (decrease) in cash 2,488 238 (44) Cash at beginning of year 1,081 843 887 - ----------------------------------------------------------------------------------------------------------------- Cash at end of year $ 3,569 $ 1,081 $ 843 =================================================================================================================
The accompanying notes are an integral part of these consolidated financial statements. Plexus Corp. 14 1995 Annual Report 17 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES Consolidation Principles: The consolidated financial statements include the accounts of Plexus Corp. and its subsidiaries, all of which are wholly-owned. All significant intercompany transactions have been eliminated. Inventories: Inventories are valued primarily at the lower of standard cost or market. Standard cost approximates costs determined by the first-in, first-out (FIFO) method. Property, Plant and Equipment and Depreciation: These assets are stated at cost. Depreciation, determined on the straight-line method, is based on lives assigned to the major classes of depreciable assets as follows: Buildings and improvements 18-40 years Machinery and equipment 3-10 years Office furniture and equipment 5-10 years Vehicles 3-5 years
Revenue Recognition: Revenue is recognized primarily when inventory is shipped. Revenue relating to product design and development contracts is recognized as costs are incurred utilizing the percentage-of-completion method. Income Taxes: Deferred income taxes are provided for differences between the bases of assets and liabilities for financial and tax reporting purposes. Stock Options: Proceeds from the sale of newly-issued common stock to employees under the Company's stock option plan are credited to common stock to the extent of par value and the excess to additional paid-in-capital. Income tax benefits attributable to stock options exercised are recorded as an increase in additional paid-in-capital. Net Income Per Common and Common Equivalent Share: The computations of primary and fully diluted net income per common share for 1995 and 1994 are based upon the weighted average number of common shares outstanding plus the effect of common shares contingently issuable relating to outstanding stock options using the treasury stock method and common shares contingently issuable relating to the convertible preferred stock using the if-converted method. In 1993, stock options did not impact net income per share as they were either insignificant or antidilutive, thus the computations are based solely upon the weighted average number of common shares outstanding during the period. The fully diluted calculation reflects additional dilution from stock options and convertible preferred shares applying the market price at the end of the period when that price is higher than the average market price for the period. The common equivalent shares outstanding for the calculation of primary and fully diluted net income per common share were 7,137,487 and 7,249,286 in 1995, respectively. In 1994, and 1993, the common equivalent shares outstanding for the calculation of primary and fully diluted net income per common share were 6,705,239, and 6,448,173, respectively. Reclassification: Certain prior years' amounts have been reclassified to conform to the 1995 presentation. NOTE 2 - INVENTORIES The major classes of inventories at September 30, 1995 and 1994 are as follows (in thousands):
1995 1994 Assembly parts $33,950 $38,156 Work-in-process 14,782 21,383 Finished goods 234 508 ------------------------ $48,966 $60,047 ========================
NOTE 3 - PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment, net at September 30, 1995 and 1994 consist of the following (in thousands):
1995 1994 Land and improvements $ 731 $ 731 Buildings and improvements 7,664 7,614 Machinery and equipment 13,881 12,682 Office furniture and equipment 6,954 6,108 Vehicles 671 663 Construction-in-progress 193 783 ------------------------------ $ 30,094 $28,581 Less accumulated depreciation 18,265 15,725 ------------------------------ $ 11,829 $12,856 ==============================
Plexus Corp. 15 1995 Annual Report 18 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 4 - DEBT Long-term debt at September 30, 1995 and 1994 consists of the following (in thousands):
1995 1994 Revolving credit arrangement (described below) $41,500 $37,100 $3,500,000 Bank Promissory Note, paid in 1995 - 3,500 Other notes and obligations with a weighted average interest rate of 5.9% 341 641 ----------------------- 41,841 41,241 Less current portion 107 550 ----------------------- $41,734 $40,691 =======================
The revolving credit arrangement matures in July 1998 and provides for maximum borrowings of $55,000,000, with all or portion of the principal bearing interest at a prime-based or a LIBOR-based rate as elected by the Company. These rates range from prime plus 1/4% to prime plus 1/2% and LIBOR plus 2% to LIBOR plus 2 1/2%, depending on the Company's consolidated debt-to-worth ratio, as defined by the Loan Agreement. The weighted average interest rate for this agreement was 7.7% at September 30, 1995. The amount available under this agreement is limited to 80% of qualified accounts receivable and 50% of qualified inventory. Inventory borrowings are limited to $27,500,000. A commitment fee of 1/4 of 1% per annum on the unused portion of this arrangement is payable quarterly. During 1995, the Company has an interest rate cap agreement with a commercial bank which limited the Company's interest rate on a portion of its floating rate long-term debt to 8% or 8.5%, depending on the rate charged on the revolving credit arrangement. The agreement had a notional amount of $10,000,000 and expires on October 7, 1996. The revolving credit agreement, as amended, includes covenants which require the maintenance of various debt-to-net worth ratios. The aggregate scheduled maturities of long-term debt in subsequent years are as follows (in thousands): 1996 $ 107 1997 63 1998 41,509 1999 10 2000 10 Thereafter 142 ------- $41,841 =======
Cash paid for interest during the years ended September 30, 1995, 1994 and 1993 was $2,954,000, $3,248,000 and $1,727,000, respectively. NOTE 5 - INCOME TAXES The Company and its subsidiaries file a consolidated Federal income tax return. Income taxes consist of the following (in thousands):
1995 1994 1993 Currently payable: Federal $3,209 $1,706 $1,464 State 638 323 260 ------------------------------------ 3,847 2,029 1,724 ------------------------------------ Deferred: Federal 52 (210) (141) State 40 54 (23) ------------------------------------ 92 (156) (164) ------------------------------------ $3,939 $1,873 $1,560 ====================================
Following is a reconciliation of the Federal statutory income tax rate to the effective tax rates reflected in the consolidated statements of operations for the years ended September 30, 1995, 1994 and 1993:
1995 1994 1993 Federal statutory income tax rate 34.0% 34.0% 34.0% Increase (decrease) resulting from: State income taxes, net of Federal income tax benefit 4.4 5.0 4.2 Other, net (0.1) (1.0) (0.4) ------------------------------------ Effective tax rate 38.3% 38.0% 37.8% ====================================
Plexus Corp. 16 1995 Annual Report 19 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The components of the net deferred income tax asset as of September 30, 1995 and 1994, were as follows (in thousands):
1995 1994 Deferred tax assets: Accrued benefits $ 521 $ 415 Loss carryforwards 115 153 Partnership investment 122 120 Valuation reserves 209 417 Health insurance 31 31 Inventory capitalization 217 99 Other 340 117 ----------------------- 1,555 1,352 Less valuation allowance (181) (142) ----------------------- 1,374 1,210 ----------------------- Deferred tax liabilities: Property, plant and equipment 997 827 Other 191 105 ----------------------- 1,188 932 ----------------------- Net deferred income tax asset $ 186 $ 278 =======================
Cash paid for income taxes for the years ended September 30, 1995, 1994 and 1993 was $4,577,000, $1,419,000 and $1,884,000, respectively. NOTE 6 - STOCKHOLDERS' EQUITY During 1994, the company issued 7,000 shares of Series A Preferred Stock (the "Preferred Shares") with a face value of $1,000 per share at face value. Dividends are earned on the face value of the Preferred Shares at 1/2 the sum of the prime rate less 1%. These dividends are cumulative and payable semi-annually in arrears, when and as declared by the Company's Board of Directors. At September 30, 1995, dividends of $8.25 per share (aggregate $58,000) were in arrears on the Preferred Shares. Upon liquidation of the Company, holders of the Preferred Shares would be entitled to receive the face value of the Preferred Shares, plus any accrued but unpaid dividends, whether declared or not, before any distribution to the common shareholders of the Company. The Company may redeem the Preferred Shares at any time on or after June 30, 1995, at face value plus any accrued but unpaid dividends, whether declared or not. From and after October 1, 1994 until June 30, 2004, the Preferred Shares are convertible into common stock at a conversion price of $12.63 per share. The Company has reserved 554,455 shares of its authorized but unissued common stock for possible conversion. NOTE 7 - LEASE COMMITMENTS The Company has a number of operating lease agreements primarily involving manufacturing equipment, computerized design equipment and manufacturing facilities. These leases are noncancelable and expire on various dates through 2014. Rent expense under all operating leases during 1995, 1994 and 1993 was approximately $12,491,090, $10,519,000 and $7,742,000, respectively. Renewal and purchase options are available on certain of these leases. During 1994, the Company sold its Advanced Manufacturing Facility for $9,250,000 and entered into an agreement to lease the facility back from the purchaser. The lease calls for annual rental payments of $1,091,000 over twenty years and allows the Company to extend the lease for six five-year periods. The lease has been accounted for as an operating lease. The gain recognized on the sale was not significant. The future minimum annual payments on these leases are as follows (in thousands): 1996 $12,929 1997 7,958 1998 3,437 1999 1,823 2000 1,777 Thereafter 18,552 ------- $46,476 =======
NOTE 8 - STOCK OPTION AND SAVINGS PLANS The Company's 1988 Stock Option Plan (the "1988 Plan") authorizes the Company to grant options to purchase up to 900,000 shares of common stock. All shares will be made available from authorized and unissued shares. Officers and key employees of the Company are eligible to receive options. The 1988 Plan provides for the granting of options at an option price of not less than the fair market value on the date of grant. Options vest over a three-year period. Additionally, the 1988 Plan authorizes the Company to grant 450,000 stock appreciation rights, none of which have been granted as of September 30, 1995. During 1995, the Company approved two stock option plans, the 1995 Executive Stock Option Plan (the "Executive Plan") and the 1995 Directors' Stock Option Plan (the "Directors' Plan"). The Executive Plan authorizes the Company to grant options to purchase up to 1,000,000 shares of common stock. All shares will be made available from authorized and unissued shares. Options may be Plexus Corp. 17 1995 Annual Report 20 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS granted to officers and key employees of the Company provided that no officer or key employee may be granted an option or options covering, in the aggregate, more than 50,000 shares of stock in any calendar year. The Executive Plan provides for the granting of options at an option price of not less than the fair market value on the date of grant. Options vest over a three-year period after the date of grant. Additionally, the Executive Plan authorizes the Company to grant 300,000 stock appreciation rights, none of which have been granted as of September 30, 1995. The Executive Plan shall terminate on December 31, 2004 or at such earlier time as the Board of Directors may determine. The Directors' Plan authorizes the Company to grant options to purchase up to 100,000 shares of common stock. Shares may come from authorized but unissued shares, from treasury shares held by the Company, from shares purchased by the Company on an open market for such purpose, or from any combination of the foregoing. At the first meeting of the Board of Directors following the Company's 1995 annual meeting of shareholders, each person then serving the Company as an outside director was granted a non-qualified stock option to purchase 1,500 shares. Commencing December 1, 1995, and continuing on the first business day of each December thereafter through December 1, 2004, each person then serving the Company as an outside director shall automatically be granted a non-qualified stock option to purchase 1,500 shares. The Directors' Plan provides for the granting of options at an option price of not less than the fair market value on the date of grant and shall terminate on December 31, 2004 or at such earlier time as the Board may determine. Stock option balances and transactions under the 1988 Plan, the Executive Plan, and the Directors' Plan at and during the years ended September 30, 1995, 1994, and 1993 are summarized as follows:
1995 1994 1993 Outstanding at beginning of year 560,661 402,161 247,162 Granted 239,000 178,000 160,500 Exercised (between $3.88 and $13.69 per share) (30,834) (16,500) - Lapsed (24,838) (3,000) (5,501) ------------------------------------------- Outstanding at end of year 743,989 560,661 402,161 =========================================== Exercisable at end of year 349,945 252,696 127,366 =========================================== Shares available for future options at end of year 1,100,000 2 175,002 ===========================================
Options outstanding as of September 30, 1995 have exercise prices ranging from $2.54 to $17.44 per share. The Company's 401(k) savings plan covers all employees with one or more years of service. The Company matches employee contributions up to 2.5% of eligible earnings. The Company's contributions for 1995, 1994 and 1993 totaled $644,000, $563,000 and $498,000, respectively. The Company is not obligated to provide any postretirement medical or life insurance benefits to employees. NOTE 9 - BUSINESS SEGMENT AND MAJOR CUSTOMERS The Company and its subsidiaries operate in one business segment, the production and sale of electronic products including the designing, manufacturing, programming and testing of computerized electronic assemblies. Approximate sales to various divisions of a major customer were 25.6%, 39.4% and 36.6% of consolidated net sales for the years ended September 30, 1995, 1994 and 1993, respectively. Additionally, sales to various divisions of another major customer approximated 17.3%, 15.6% and 18.7% of consolidated net sales for the years ended September 30, 1995, 1994 and 1993, respectively. NOTE 10 - TRANSACTIONS WITH RELATED PARTIES During 1993 and 1992, a wholly-owned subsidiary of the Company, Plexus General Partner Corp., made capital contributions totaling $700,000 to the Plexus Home Automation Limited Partnership ("PHALP"). Several of the limited partners of PHALP are officers, directors and/or shareholders of the Company and/or other Company subsidiaries. The Company recorded losses of $413,000 in the years 1993 through 1995 which reduced the carrying value of this investment. PHALP became inactive during the latter half of 1995 and as a result the Company wrote off its remaining investment in the partnership of $57,000 and certain other related assets of $180,000. The Company billed PHALP $41,000, $65,000 and $693,000, during the years 1995, 1994 and 1993, respectively, for certain services rendered by the Company. During 1994, promissory notes aggregating $5,000,000, which were payable to certain shareholders of the Company who are also limited partners in PHALP, were paid in full with the proceeds from the issuance of the Series A Preferred Stock. The preferred shares were issued to and are held by the former holders of the promissory notes described above. Plexus Corp. 18 1995 Annual Report 21 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 11 - QUARTERLY FINANCIAL DATA (UNAUDITED) Summarized quarterly financial data for the years ended September 30, 1995 and 1994 is as follows (in thousands except per share and stock price amounts):
FIRST SECOND THIRD FOURTH 1995 QUARTER QUARTER QUARTER QUARTER TOTAL Net sales $ 65,341 $ 69,380 $ 72,354 $ 76,059 $ 283,134 Gross profit 4,358 5,938 6,275 7,125 23,696 Net income 895 1,470 1,823 2,155 6,343 Income per common share(*) Primary $ 0.13 $ 0.21 $ 0.26 $ 0.30 $ 0.89 Fully diluted 0.13 0.21 0.26 0.30 0.88 Stock price: High $ 10 3/4 $ 12 7/8 $ 14 3/4 $ 18 7/8 $ 18 7/8 Low 8 1/4 8 1/2 11 1/4 13 1/2 8 1/4 1994 Net sales $ 55,944 $ 61,323 $ 55,004 $ 70,212 $ 242,483 Gross profit 3,590 4,482 3,644 4,454 16,170 Net income 704 1,023 304 1,026 3,057 Income per common share(*) $ 0.11 $ 0.16 $ 0.05 $ 0.15 $ 0.46 Stock price: High $ 18 $ 17 1/2 $ 16 3/4 $ 12 1/2 18 Low 14 1/4 15 1/4 11 3/4 10 1/4 $ 10 1/4
(*) Income per common share is computed independently for each quarter. The annual per share amount may not equal the sum of the quarterly amounts due to rounding. The amounts shown for 1994 represent primary and fully diluted earnings per common share. The Company recognized adjustments in the fourth quarter of 1995 and 1994 related principally to the adjustment of perpetual inventory records to actual balances which decreased and increased quarterly earnings per share by $(.02) and $0.05, respectively. REPORT OF INDEPENDENT ACCOUNTANTS TO THE SHAREHOLDERS AND BOARD OF DIRECTORS OF PLEXUS CORP. We have audited the accompanying consolidated balance sheets of Plexus Corp. and Subsidiaries as of September 30, 1995 and 1994, and the related consolidated statements of operations, stockholders' equity and cash flows for each of the three years in the period ended September 30, 1995. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Plexus Corp. and Subsidiaries as of September 30, 1995 and 1994, and the consolidated results of their operations and their cash flows for each of the three years in the period ended September 30, 1995, in conformity with generally accepted accounting principles. Milwaukee, Wisconsin COOPERS & LYBRAND L.L.P. November 17, 1995 Plexus Corp. 19 1995 Annual Report 22 SHAREHOLDER INFORMATION INFORMATION ON COMMON STOCK For the years ended September 30, 1995 and 1994, the Company's Common Stock has traded on the NASDAQ National Market System; the price information for that period represents high and low sale prices. The Company has not paid any cash dividends. See "Management's Discussion and Analysis of Financial Condition and Results of Operations" for a discussion of the Company's dividend intentions and Note 4 to the Consolidated Financial Statements for restrictions on dividend payments.
PRICE RANGE OF PRICE RANGE OF Fiscal Year Ended COMMON STOCK Fiscal Year Ended COMMON STOCK September 30, 1995 Low High September 30, 1994 Low High First Quarter 8 1/4 10 3/4 First Quarter 14 1/4 18 Second Quarter 8 1/2 12 7/8 Second Quarter 15 1/4 17 1/2 Third Quarter 11 1/4 14 3/4 Third Quarter 11 3/4 16 3/4 Fourth Quarter 13 1/2 18 7/8 Fourth Quarter 10 1/4 12 1/2 Year 8 1/4 18 7/8 Year 10 1/4 18
INVESTOR INFORMATION Plexus Corp. Common Stock is traded over-the-counter on the NASDAQ National Market System, symbol PLXS. As of September 30, 1995, there were approximately 2,500 shareholders of record. A copy of Plexus Corp.'s 1995 Form 10-K Report to the Securities and Exchange Commission is available to the shareholders upon written request to: Joseph D. Kaufman, Secretary Plexus Corp. 55 Jewelers Park Drive P.O. Box 156 Neenah, WI 54957-0156 TRANSFER AGENT AND REGISTRAR Firstar Trust Company 615 E. Michigan Street P.O. Box 2077 Milwaukee, WI 53201-2077 (800) 637-7549 AUDITORS Coopers & Lybrand 411 E. Wisconsin Avenue Milwaukee, WI 53202 Plexus Corp. 20 1995 Annual Report 23 DIRECTORS AND OFFICERS BOARD OF DIRECTORS ROBERT A. COOPER Senior Vice President Dain Bosworth Inc. (Brokerage and other financial services) RUDOLPH T. HOPPE Retired; previously President and Director The Glenora Company (Investments) HAROLD R. MILLER Retired; previously Chairman of the Board Marathon Engineers/Architects/Planners, Inc. (Architects and engineers) ALLAN C. MULDER Retired; previously Chairman of the Board Miller Electric Manufacturing Co. (Manufacturer of welding equipment) JOHN L. NUSSBAUM President Plexus Corp. GERALD A. PITNER Executive Vice President Plexus Corp. THOMAS J. PROSSER Vice President - Investment Banking Robert W. Baird & Co., Inc. (Brokerage and other financial services) PETER STRANDWITZ Chairman and Chief Executive Officer Plexus Corp. EXECUTIVE OFFICERS PETER STRANDWITZ Chairman and Chief Executive Officer JOHN L. NUSSBAUM President GERALD A. PITNER Executive Vice President CHARLES C. WILLIAMS Vice President WILLIAM F. DENNEY Vice President and Controller JOSEPH D. KAUFMAN Vice President, Secretary and General Counsel 24 [PLEXUS LOGO] 55 Jewelers Park Drive Post Office Box 156 Neenah, WI 54957-0156 Product development, manufacturing and testing solutions for the electronics industry. -----END PRIVACY-ENHANCED MESSAGE-----