EX-99.1 2 a06-10192_1ex99d1.htm EX-99

Exhibit 99.1

 

Press Release

For More Information, Call:

 

GAYLA J. DELLY

 

 

CHIEF FINANCIAL OFFICER

 

April 20, 2006

(979) 849-6550

 

 

 

FOR IMMEDIATE RELEASE

 

BENCHMARK ELECTRONICS REPORTS SALES

AND EARNINGS FOR FIRST QUARTER 2006

AND RAISES FULL YEAR 2006 GUIDANCE

 

ANGLETON, TX, APRIL 20, 2006 – Benchmark Electronics, Inc. (NYSE: BHE), a leading contract manufacturing provider, announced sales of $651 million for the quarter ended March 31, 2006, compared to $510 million for the same quarter last year. First quarter net income was $26.5 million, or $0.41 per diluted share. In the comparable period last year, net income was $16.9 million, or $0.26 per diluted share. Excluding restructuring charges, the impact of stock-based compensation costs and a tax benefit resulting from the closure of our UK facility, the Company had net income before special items of $24.7 million, or $0.38 per diluted share, in the first quarter of 2006. All share and per share data appearing in this press release has been retroactively adjusted for the 3-for-2 stock split completed on April 3, 2006 to holders of record as of March 27, 2006.

 

“These results reflect the overall strength of our business model. With overall improvements in the marketplace, our primary challenge is to properly manage our growth and maintain our execution levels,” stated Benchmark’s President and CEO Cary T. Fu.

 

First Quarter 2006 Financial Highlights

 

                  Operating margin for the first quarter was 4.0% on a GAAP basis and was 4.5%, excluding restructuring charges and the impact of stock-based compensation expenses.

                  Cash flows used by operating activities for the first quarter was $42.7 million.

                  Cash and short-term investments balance at March 31, 2006 of $288 million.

                  No debt outstanding.

                  Accounts receivable balance at March 31, 2006 of $447 million; calculated days sales outstanding were 62 days.

                  Inventory of $403 million at March 31, 2006; inventory turns were 6.0 times.

 

Second Quarter 2006 Guidance

 

Revenues for the second quarter of 2006 are expected to be between $630 million and $660 million. Diluted earnings per share for the second quarter, excluding restructuring charges and the impact of stock-based compensation expenses, are expected to be between $0.36 and $0.39 ($0.33 and $0.36 on a GAAP basis).

 



 

Full Year 2006 Guidance

 

We are raising our full year guidance. Revenues for 2006 are now expected to be between $2.55 billion and $2.60 billion. The corresponding diluted earnings per share for 2006, excluding restructuring charges, the impact of stock-based compensation expenses and the first quarter tax benefit, are expected to be between $1.48 and $1.53 ($1.46 and $1.51 on a GAAP basis).

 

Non-GAAP Financial Measures

 

This press release includes financial measures for earnings and earnings per share that excludes certain items and therefore are not in accordance with generally accepted accounting principles (GAAP). A detailed reconciliation between the GAAP results and results excluding special items (non-GAAP) is included at the end of this press release. By disclosing this non-GAAP information, management intends to provide investors with additional information to further analyze the 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.

 

Non-GAAP information is not necessarily comparable to Non-GAAP information of other companies. Non-GAAP information should not be viewed as a substitute for, or superior to, net income or other data prepared in accordance with GAAP as measures of our profitability or liquidity. Users of this financial information should consider the types of events and transactions for which adjustments have been made.

 

Forward-Looking Statements

 

This news release contains certain forward-looking statements within the scope of the Securities Act of 1933 and the Securities Exchange Act of 1934. The words “expect,” “estimate,” “anticipate,” “predict,” and similar expressions, and the negatives of such expressions, are intended to identify forward-looking statements. Although Benchmark believes that these statements are based upon reasonable assumptions, such statements involve risks, uncertainties and assumptions, including but not limited to industry and economic conditions, customer actions and the other factors discussed in Benchmark’s Form 10-K for the year ended December 31, 2005 and its other filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated.

 

Benchmark Electronics, Inc. is in the business of manufacturing electronics and provides its services to original equipment manufacturers of computers and related products for business enterprises, medical devices, industrial control equipment, testing and instrumentation products, and telecommunication equipment. Benchmark’s global operations include facilities in seven countries. Benchmark’s Common Shares trade on the New York Stock Exchange under the symbol BHE.

 



 

A conference call hosted by Benchmark management will be held today at 10:00 am (Central time) to discuss the financial results of the Company and its future outlook. This call will be broadcast via the Internet and may be accessed by logging on to our website at www.bench.com.

 

###

 



 

Benchmark Electronics, Inc. and Subsidiaries

 

Consolidated Statements of Income

(Amounts in Thousands, Except Per Share Data)

(UNAUDITED)

 

 

 

Three Months Ended
March 31,

 

 

 

2006

 

2005

 

 

 

 

 

 

 

Net sales

 

$

651,244

 

$

509,582

 

Cost of sales

 

605,878

 

472,097

 

 

 

 

 

 

 

Gross profit

 

45,366

 

37,485

 

 

 

 

 

 

 

Restructuring charges

 

2,769

 

 

Selling, general and administrative expenses

 

16,370

 

15,212

 

 

 

 

 

 

 

Income from operations

 

26,227

 

22,273

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

Interest expense

 

(86

)

(67

)

Other

 

1,689

 

670

 

Total other income, net

 

1,603

 

603

 

 

 

 

 

 

 

Income before income taxes

 

27,830

 

22,876

 

 

 

 

 

 

 

Income tax expense

 

1,308

 

5,947

 

 

 

 

 

 

 

Net income

 

$

26,522

 

$

16,929

 

 

 

 

 

 

 

Denominator for basic earnings per share - weighted average number of common shares outstanding during the period

 

63,601

 

62,440

 

Incremental common shares attributable to exercise of outstanding dilutive options

 

1,224

 

1,621

 

Denominator for diluted earnings per share

 

64,825

 

64,061

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

Basic

 

$

0.42

 

$

0.27

 

Diluted

 

$

0.41

 

$

0.26

 

 



 

Benchmark Electronics, Inc. and Subsidiaries

 

Condensed Consolidated Balance Sheet

March 31, 2006

(Amounts in Thousands)

(UNAUDITED)

 

Assets

 

 

 

 

 

 

 

Current assets:

 

 

 

Cash and cash-equivalents

 

$

115,645

 

Short-term investments

 

172,135

 

Accounts receivable, net

 

446,622

 

Inventories, net

 

403,161

 

Other current assets

 

29,541

 

 

 

 

 

Total current assets

 

1,167,104

 

 

 

 

 

Property, plant and equipment, net

 

97,694

 

Other assets, net

 

6,392

 

Goodwill, net

 

112,991

 

 

 

 

 

Total assets

 

$

1,384,181

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

 

Current liabilities:

 

 

 

Accounts payable

 

$

406,342

 

Other current liabilities

 

76,404

 

 

 

 

 

Total current liabilities

 

482,746

 

 

 

 

 

Other long-term liabilities

 

14,805

 

 

 

 

 

Shareholders’ equity

 

886,630

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

1,384,181

 

 



 

Benchmark Electronics, Inc. and Subsidiaries

 

Reconciliation of GAAP to Non-GAAP Financial Results

Three Months Ended March 31, 2006

(Amounts in Thousands)

(UNAUDITED)

 

Operating income (GAAP)

 

$

26,227

 

Stock-based compensation

 

486

 

Restructuring charges

 

2,769

 

 

 

 

 

Non-GAAP operating income

 

$

29,482

 

 

 

 

 

Net income (GAAP)

 

$

26,522

 

Stock-based compensation, net of tax

 

372

 

Restructuring charges, net of tax

 

2,553

 

UK investment tax benefit

 

(4,760

)

 

 

 

 

Non-GAAP net income

 

$

24,687

 

 

 

 

 

Earnings per share: (GAAP)

 

 

 

Basic

 

$

0.42

 

Diluted

 

$

0.41

 

 

 

 

 

Earnings per share: (Non-GAAP)

 

 

 

Basic

 

$

0.39

 

Diluted

 

$

0.38

 

 

 

 

 

Weighted average shares used in calculating earnings per share:

 

 

 

Basic

 

63,601

 

Diluted

 

64,825