The beaten-down, about to bounce list for 2005

SLR...

Solectron Corp. provide electronics manufacturing services to original equipment manufacturers who design and sell networking equipment, mobile and land based telecommunications equipment, computing equipment, including workstations, notebooks, desktops and peripherals, and other electronic equipment. These original equipment manufacturers include Cisco Systems, Inc., Compaq Computer Corporation, Ericsson Telecom AB, Hewlett-Packard Company, International Business Machines Corporation, and Nortel Networks Limited.

Jan.$25c.: NYTAE 1.75 +0.10 20.00 1.50 1.70 126.00

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Solectron Announces First Quarter Financial Results; Company Delivered Sequential Revenue Growth in Q1
12/22/2005

MILPITAS, Calif., Dec 22, 2005 (BUSINESS WIRE) --
Solectron Corporation (NYSE:SLR), a leading provider of electronics manufacturing and integrated supply chain services, today reported sales of $2.46 billion in the first quarter of fiscal 2006, an increase of 2.4 percent over fourth quarter revenues of $2.40 billion. Sales in the first quarter of fiscal 2005 were $2.69 billion.

The company reported a GAAP profit after tax from continuing operations in the first quarter of $20.2 million, or two cents per share, compared with GAAP profit after tax from continuing operations of $11.8 million, or one cent per share, in the fourth quarter of fiscal 2005. GAAP profit after tax from continuing operations in the first quarter of fiscal 2005 was $47.5 million, or 5 cents per share.

Non-GAAP profit after tax for the first quarter was $28.1 million, or $0.03 per share, compared to non-GAAP profit after tax of $41.4 million, or $0.04 per share, for the fourth quarter of fiscal 2005, and non-GAAP profit after tax of $51.4 million, or $0.05 per share in the first quarter of fiscal 2005. Non-GAAP financial results do not include restructuring costs, impairment charges, amortization of intangibles, stock based compensation expenses, or other infrequent or unusual items. The financial results of prior periods have been adjusted to reflect the impact of stock compensation charges and amortization of intangibles. Please refer to "Non-GAAP Information" below for further information.

"We are pleased to deliver sequential revenue growth in the first quarter," said Mike Cannon, president and chief executive officer, Solectron. "We are continuing to make investments to expand our global capabilities and to position Solectron for continued revenue growth in the second half of this year."

First Quarter 2006 Highlights

Improved Asset Velocity Metrics

The company made further improvements in working capital during the quarter. Days sales outstanding improved to 45 days and inventory turns in the quarter were eight. The company's cash conversion cycle improved to 37 days.

Company Invests to Expand Global Capabilities

In the first quarter, Solectron opened new design engineering facilities in Guadalajara, Mexico, and Timisoara, Romania, and expanded its existing design capabilities in Singapore and Shanghai, China. In featuring design services in conjunction with the Solectron Production System(TM), Solectron is expanding its competitive offerings to help customers accelerate time-to-market with lower costs, improved quality and increased flexibility.

The Guadalajara site was also recently expanded to add an Enclosure Center, adding this critical vertical integration capability to the Guadalajara campus. The Company also recently announced the opening of a medical manufacturing Center of Excellence in Singapore, to provide medical device manufacturers access to a lower-cost manufacturing region.

Stock Repurchase Program

On November 1, 2005, Solectron announced that the company has successfully completed the $250 million stock repurchase program commenced in July 2005. Under this program, the company repurchased 63.6 million shares of its common stock. On November 1, Solectron announced that its Board of Directors authorized a new stock repurchase program, to commence in the second quarter, under which up to $250 million of the company's outstanding common stock may be repurchased over the next 12 months.



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