8-K

 

UNITED STATES

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 25, 2013

BENCHMARK ELECTRONICS, INC.

(Exact name of registrant as specified in its charter)

Texas (State or other jurisdiction of incorporation) 1-10560 (Commission File Number) 74-2211011 (I.R.S. Employer Identification No.)

3000 Technology Drive, Angleton, Texas77515 

(Address of principal executive offices)  (Zip code)

Registrant’s telephone number, including area code:  (979) 849-6550

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

     [  ] Written communications pursuant to Rule 425 under the Securities Act

     (17 CFR 230.425)

     [  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act

     (17 CFR 240.14a-12)

     [  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the

     Exchange Act (17 CFR 240.14d-2(b))

     [  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the

     Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.   Results of Operations and Financial Condition.

On July 25, 2013, Benchmark Electronics, Inc. issued a press release announcing the results of operations for the quarter ended June 30, 2013 and held an earnings conference call at 10:00 am (Central time). A copy of the press release and the presentation slides are attached as Exhibit 99.1 and Exhibit 99.2 to this Current Report on Form 8-K and are hereby incorporated herein by reference.

The information in this report, being furnished pursuant to Item 2.02 of Form 8-K, shall not be deemed to be “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, and is not incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01.   Financial Statements and Exhibits.

                (d)  Exhibits 

Exhibit 99.1  Press release dated July 25, 2013.

Exhibit 99.2  Presentation slides for earnings conference call.

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 hereunto duly authorized.

BENCHMARK ELECTRONICS, INC.

Dated: July 25, 2013	By: /s/ Donald F. Adam
	Donald F. Adam
	Chief Financial Officer

EXHIBITS INDEX

Exhibit

NumberDescription 

            Exhibit 99.1          Press release dated July 25, 2013.

            Exhibit 99.2          Presentation slides for earnings conference call.

EX-99

 

EXHIBIT 99.1

FOR IMMEDIATE RELEASE

BENCHMARK ELECTRONICS REPORTS RESULTS FOR THE

QUARTER ENDED JUNE 30, 2013

ANGLETON, TX, JULY25, 2013 – Benchmark Electronics, Inc. (NYSE: BHE), a leading integrated contract manufacturing provider, today announced financial results for the second quarter which ended June 30, 2013.

	Three Months Ended
	June 30,		March 31,		June 30,
	2013		2013		2012
Net sales (in millions)	$608		$542		$630
Net income (in millions)	$8		$11		$14
Net income – non-GAAP (in millions)	$17		$12		$18
Diluted EPS	$0.16		$0.21		$0.24
Diluted EPS – non-GAAP	$0.31		$0.22		$0.32
Operating margin (%)	2.1	%	2.6	%	2.9	%
Operating margin – non-GAAP (%)	3.5	%	2.7	%	3.7	%

“In the second quarter, we delivered strong performance with revenue and operating margins (non-GAAP) up sequentially from the first quarter of this year,” said President and CEO Gayla J. Delly. “While the current macro environment provides limited visibility, we continue to see good long-term opportunities with new and existing customers. Our business development efforts resulted in another quarter of robust bookings, providing a solid foundation for continued growth.”

Second Quarter 2013 Highlights

·Revenue of $608 million increased 12% from Q1 2013.

·Revenue bookings in Q2 2013 were $135 million to $155 million.

·During the quarter, we acquired Suntron Corporation for $19 million which includes twosites: Tijuana, Mexico and Phoenix, Arizona.

·Non-GAAP diluted earnings per share of $0.31was aboveour expectations primarily impacted by Q2 revenue strength.

·Restructuring and integration costs of $6 million are primarily related to severance and asset impairment charges related to the closure of our Brazil manufacturing operations.

·Asset impairment charge and other of $3 millionprimarily relates to the impairment of a building classified as “Held for Sale”.

·Cash flows provided by operating activities for Q22013 were approximately $11 million. There were no Thailand flood insurance recoveries during Q2 2013and the recovery process with our insurance carriers is ongoing.

·Cash and long-term investments balance was $409 million at June 30, 2013.

·Accounts receivable was $464 million at June 30, 2013; calculated days sales outstanding were 69 days compared to 69 days at March 31, 2013 and 65 days at June 30, 2012.

·Inventory was $350million at June 30, 2013; inventory turns were 6.4 times compared to 6.3 at March 31, 2013 and 6.0 at June 30, 2012.

·Repurchases of common shares for the second quarter totaled $9 million or  520thousand shares. 

Second Quarter Industry Sector Update

The following table sets forth revenue by industry sector for the quarters ended June 30, 2013, March 31, 2013 and June 30, 2012.

		June 30,		March 31,		June 30,
		2013		2013		2012
Computers and related products for business
	enterprises	29	%	25	%	31	%
Industrial control equipment		30		30		26
Telecommunication equipment		23		26		25
Medical devices		12		13		10
Testing and instrumentation products		6		6		8
		100	%	100	%	100	%

Third Quarter 2013 Outlook

·Revenue between $590 and $620 million.

·Diluted earnings per share between $0.28 and $0.32 (excluding restructuring and Thailand flood related items).

Conference Call Details

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.

About Benchmark Electronics, Inc.

Benchmark Electronics, Inc. provides integrated manufacturing, design and engineering services to original equipment manufacturers of computers and related products for business enterprises, medical devices, industrial control equipment (which includes equipment for the aerospace and defense industry), testing and instrumentation products, and telecommunication equipment. Benchmark’s global operations include 23 facilities in nine countries. Benchmark’s Common Shares trade on the New York Stock Exchange under the symbol BHE.

For More Information, Please Contact:

Lisa K. Weeks, VP of Strategy & Investor Relations

979-849-6550 (ext. 1361) or lisa.weeks@bench.com

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, the statements “while the current macro environment provides limited visibility, we continue to see good long-term opportunities with new and existing customers” and “our business development efforts resulted in another quarter of robust bookings, providing a solid foundation for continued growth”, our sales and diluted earnings per share (excluding special items) guidance for the third quarter of 2013, as well as other statements, express or implied, concerning: the potential recovery of insurance proceeds; 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. 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, 2012, in its other filings with the Securities and Exchange Commission and in its press releases.

###

Benchmark Electronics, Inc. and Subsidiaries
Consolidated Statements of Income
(Amounts in Thousands, Except Per Share Data)
(UNAUDITED)
			Three months ended				Six Months Ended
			June 30,				June 30,
			2013		2012		2013		2012
Sales		$	607,522	$	630,031	$	1,149,966	$	1,223,448
Cost of sales			563,155		584,040		1,068,765		1,136,949
	Gross profit		44,367		45,991		81,201		86,499
Selling, general and administrative expenses			23,311		22,779		45,710		45,280
Restructuring charges and integration costs			5,667		286		6,109		250
Asset impairment charge and other			2,606		-		2,606		-
Thailand flood related charges, net of insurance			-		4,658		-		14,876
	Income from operations		12,783		18,268		26,776		26,093
Interest expense			(463)		(322)		(922)		(647)
Interest income			291		231		705		609
Other expense, net			(501)		(448)		(185)		(82)
	Income before income taxes		12,110		17,729		26,374		25,973
Income tax expense			3,653		4,149		6,430		6,795
	Net income	$	8,457	$	13,580	$	19,944	$	19,178
Earnings per share:
	Basic	$	0.16	$	0.24	$	0.37	$	0.34
	Diluted	$	0.16	$	0.24	$	0.36	$	0.33
Weighted-average number of shares used in calculating earnings per share:
	Basic		54,207		56,963		54,500		57,223
	Diluted		54,500		57,198		54,897		57,599

Benchmark Electronics, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
					June 30,		December 31,
					2013		2012
					(unaudited)
Assets
	Current assets:
		Cash and cash equivalents		$	398,902	$	384,579
		Accounts receivable, net			464,491		459,081
		Inventories, net			350,416		324,041
		Other current assets			44,712		46,490
			Total current assets		1,258,521		1,214,191
	Long-term investments				10,575		10,324
	Property, plant and equipment, net				173,954		176,104
	Goodwill, net				37,912		37,912
	Other, net				57,856		62,946
			Total assets	$	1,538,818	$	1,501,477
Liabilities and Shareholders’ Equity
	Current liabilities:
		Current installments of capital lease obligations		$	538	$	497
		Accounts payable			294,222		260,622
		Accrued liabilities			65,477		69,396
			Total current liabilities		360,237		330,515
	Capital lease obligations, less current installments				9,822		10,103
	Other long-term liabilities				22,482		21,334
	Shareholders’ equity				1,146,277		1,139,525
			Total liabilities and shareholders’ equity	$	1,538,818	$	1,501,477

EX-99

Second Quarter Fiscal 2013 July 25, 2013 Financial Results

design develop deliver advanced technology 2 Forward - Looking Statements This document contains forward - looking statements within the meaning of Section 27 A of the Securities Act of 1933 , as amended, and Section 21 E of the Securities Exchange Act of 1934 , as amended . In addition, from time to time, Benchmark Electronics, Inc . (“the Company”) or its representatives have made or may make forward - looking statements, orally or in writing . Such forward - looking statements may be included in, but are not limited to, various filings made by the Company with the Securities and Exchange Commission, press releases or oral statements made with the approval of an authorized executive officer of the Company . Actual results could differ materially from those projected or suggested in any forward - looking statements as a result of many factors, some of which have been described in the section of the Company’s Annual Report on Form 10 - K for the year ended December 31 , 2012 , entitled “Risk Factors,” and in other documents the Company’s files from time to time, with the Securities and Exchange Commission, including annual reports on Form 10 - K, quarterly reports on Form 10 - Q and current reports on Form 8 - K . This document 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 GAAP results and results excluding special items (non - GAAP) is included in our press release and in the Appendix of this presentation .

design develop deliver advanced technology 3 Second Quarter 2013 Results (In millions, except EPS) June 30, 2013 March 31, 2013 June 30, 2012 Net Sales $607.5 $542.4 $630.0 Net Income $8.5 $11.5 $13.6 Net Income – non - GAAP $16.8 $11.9 $18.2 Diluted EPS $0.16 $0.21 $0.24 Diluted EPS – non - GAAP $0.31 $0.22 $0.32 Operating Margin 2.1% 2.6% 2.9% Operating Margin – non - GAAP 3.5% 2.7% 3.7% For the Three Months Ended Results exceeded Guidance Provided for the June 30, 2013 Quarter: ▪ Revenue $560 – $590 ▪ Diluted EPS -- non - GAAP $0.25 – $0.30

design develop deliver advanced technology 4 Second Quarter Industry Sector Update Segment June 30, 2013 March 31, 2013 June 30, 2012 Computers and Related Products for Business Enterprises 29% 25% 31% Industrial Control Equipment 30% 30% 26% Telecommunication Equipment 23% 26% 25% Medical Devices 12% 13% 10% Testing and Instrumentation Products 6% 6% 8% Total Revenue 100% 100% 100% Revenue by Industry Sector

design develop deliver advanced technology 5 ▪ Non - Recurring Items ▪ Suntron Acquisition ▪ Thailand Flood Update Discussion Items Second Quarter Financial Statement Commentary

design develop deliver advanced technology 6 Financial Statement Highlights Income Statement June 30, 2013 March 31, 2013 June 30, 2012 Net Sales $607.5 $542.4 $630.0 Operating Margin – non - GAAP 3.5% 2.7% 3.7% Net Income – GAAP $8.5 $11.5 $13.6 Net Income – non - GAAP $16.8 $11.9 $18.2 Diluted EPS – non - GAAP $0.31 $0.22 $0.32 Effective Tax Rate 17.3% 19.2% 19.5% For the Three Months Ended

design develop deliver advanced technology 7 Financial Statement Highlights Balance Sheet and Cash Flows June 30, 2013 December 31, 2012 June 30, 2012 Cash and Long - term Investments $409.5 * $394.9 $296.5 Cash Flow from Operating Activities $11.4 $80.9 $41.4 Capital Expenditures $5.1 $13.5 $8.9 Depreciation & Amortization $9.9 $9.3 $9.0 Accounts Receivable $464.5 $459.1 $458.0 Days Sales Outstanding 69x 65x 65x Inventory $350.4 $324.0 $387.7 Inventory Turns 6.4x 7.3x 6.0x Total Cost of Shares Repurchased $9.2 $15.7 $19.4 * Approximately $100 million of cash is in the U.S.

design develop deliver advanced technology 8 Second Quarter 2013 New Business Wins Q2 2013 Number of New Business Wins by Segment ▪ Q2 2013: 28 new business bookings including 9 engineering projects ▪ E stimated annual revenue run rate between $ 135 million and $ 155 million Quarterly Estimated Annual Revenue Run Rate for New Business Wins

design develop deliver advanced technology 9 Third Quarter 2013 Guidance Guidance Net Sales (in millions) $590 – $620 Diluted EPS – non - GAAP $0.28 – $0.32

design develop deliver advanced technology 10 Overall Market Updates ▪ Computing Stable Demand ▪ Industrial Growth ▪ Telecommunications Stable Demand ▪ Medical Growth ▪ Test & Instrumentation Slight Improvement Reporting Sector Outlook

design develop deliver advanced technology 11 ▪ Strong Q2 Performance ▪ Focus on Growth ▪ Continued Productivity Management ▪ New Program Execution Summary Second Quarter 2013

design develop deliver advanced technology 12 Appendix

design develop deliver advanced technology 13 Reconciliation of GAAP to non - GAAP Financial Results (Amounts in Thousands, Except Per Share Data) – (UNAUDITED) 2013 2012 2013 2012 $ 12,783 $ 18,268 $ 26,776 $ 26,093 5,667 286 6,109 250 2,606 - 2,606 - - 4,658 - 14,876 $ 21,056 $ 23,212 $ 35,491 $ 41,219 $ 8,457 $ 13,580 $ 19,944 $ 19,178 5,541 287 5,945 161 2,849 - 2,849 - - 4,373 - 13,375 $ 16,847 $ 18,240 $ 28,738 $ 32,714 Basic $ 0.16 $ 0.24 $ 0.37 $ 0.34 Diluted $ 0.16 $ 0.24 $ 0.36 $ 0.33 Basic $ 0.31 $ 0.32 $ 0.53 $ 0.57 Diluted $ 0.31 $ 0.32 $ 0.52 $ 0.57 Income from operations (GAAP) Net income (GAAP) Restructuring charges and integration costs Thailand flood related charges, net of insurance Non-GAAP income from operations Thailand flood related charges, net of insurance and tax Non-GAAP net income Earnings per share: (GAAP) Restructuring charges and integration costs, net of tax Earnings per share: (Non-GAAP) Asset impairment charge and other Asset impairment charge and other, net of tax Six Months EndedThree months ended June 30, June 30,