TEMPE, Ariz., April 28, 2021 /PRNewswire/ -- Benchmark
Electronics, Inc. (NYSE: BHE) today announced financial results for
the first quarter ended March 31,
2021.
|
|
Three Months
Ended
|
|
|
|
Mar
31,
|
|
|
Dec 31,
|
|
|
Mar 31,
|
|
In millions,
except EPS
|
|
2021
|
|
|
2020
|
|
|
2020
|
|
Sales
|
|
$
|
506
|
|
|
$
|
521
|
|
|
$
|
515
|
|
Net
income(2)
|
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
4
|
|
Net income –
non-GAAP(1)(2)
|
|
$
|
8
|
|
|
$
|
13
|
|
|
$
|
8
|
|
Diluted earnings per
share(2)
|
|
$
|
0.22
|
|
|
$
|
0.21
|
|
|
$
|
0.10
|
|
Diluted EPS –
non-GAAP(1)(2)
|
|
$
|
0.21
|
|
|
$
|
0.34
|
|
|
$
|
0.22
|
|
Operating
margin(2)
|
|
|
2.4
|
%
|
|
|
2.3
|
%
|
|
|
1.3
|
%
|
Operating margin –
non-GAAP(1)(2)
|
|
|
2.3
|
%
|
|
|
3.4
|
%
|
|
|
2.3
|
%
|
|
(1) A
reconciliation of GAAP and non-GAAP results is included
below.
|
(2) Results for
the first quarter ended March 31, 2021, fourth quarter ended
December 31, 2020 and first quarter
ended March
31, 2020 include the impact of approximately $1.4 million, $1.6
million and $0.7 million of net COVID-19
related
costs, respectively.
|
"We delivered another solid quarter of revenue, earnings, and
cash generation in line with our expectations," said Jeff Benck, Benchmark's President and CEO.
"We are particularly pleased with continued strength in the
Semi-Cap market where revenues were up 37% year-over-year in the
first quarter and are now forecasted to be up greater than 20% for
the full year 2021."
Benck continued, "Overall demand across many of our market
sectors is strengthening and we expect this to continue through the
year. In the near-term, we are proactively working with our
customers and suppliers to manage supply chain constraints. We
remain focused on our strategic objectives which gives us
confidence that we will grow revenue, margins, and earnings in
2021."
Cash Conversion Cycle
|
|
Mar 31,
|
|
|
Dec 31,
|
|
|
Mar 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2020
|
|
Accounts receivable
days
|
|
|
49
|
|
|
|
53
|
|
|
|
56
|
|
Contract asset
days
|
|
|
26
|
|
|
|
25
|
|
|
|
28
|
|
Inventory
days
|
|
|
69
|
|
|
|
63
|
|
|
|
65
|
|
Accounts payable
days
|
|
|
(64)
|
|
|
|
(54)
|
|
|
|
(61)
|
|
Advance payments from
customers days
|
|
|
(15)
|
|
|
|
(16)
|
|
|
|
(7)
|
|
Cash Conversion Cycle
days
|
|
|
65
|
|
|
|
71
|
|
|
|
81
|
|
First Quarter 2021 Industry Sector Update
Revenue and
percentage of sales by industry sector (in millions) was as
follows.
|
|
Mar 31,
|
|
|
Dec 31,
|
|
|
Mar 31,
|
|
Higher-Value
Markets
|
|
2021
|
|
|
2020
|
|
|
2020
|
|
Medical
|
|
$
|
109
|
|
|
21
|
%
|
|
$
|
111
|
|
|
21
|
%
|
|
$
|
118
|
|
|
23
|
%
|
Semi-Cap
|
|
|
113
|
|
22
|
|
|
|
101
|
|
20
|
|
|
|
83
|
|
16
|
|
A&D
|
|
|
89
|
|
18
|
|
|
|
111
|
|
21
|
|
|
|
119
|
|
23
|
|
Industrials
|
|
|
95
|
|
19
|
|
|
|
97
|
|
19
|
|
|
|
103
|
|
20
|
|
|
|
$
|
406
|
|
80
|
%
|
|
$
|
420
|
|
81
|
%
|
|
$
|
423
|
|
82
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mar 31,
|
|
|
Dec 31,
|
|
|
Mar 31,
|
|
Traditional
Markets
|
|
2021
|
|
|
2020
|
|
|
2020
|
|
Computing
|
|
$
|
44
|
|
|
9
|
%
|
|
$
|
46
|
|
|
9
|
%
|
|
$
|
36
|
|
|
7
|
%
|
Telecommunications
|
|
|
56
|
|
11
|
|
|
|
55
|
|
10
|
|
|
|
56
|
|
11
|
|
|
|
$
|
100
|
|
20
|
%
|
|
$
|
101
|
|
19
|
%
|
|
$
|
92
|
|
18
|
%
|
Total
|
|
$
|
506
|
|
100
|
%
|
|
$
|
521
|
|
100
|
%
|
|
$
|
515
|
|
100
|
%
|
Overall, higher-value market revenues were down 4%
year-over-year from softness in commercial aerospace (in A&D),
industrials and medical elective surgeries. Traditional market
revenues were up 8% year-over-year primarily from strength in the
computing sector.
Second Quarter 2021 Outlook
- Revenue between $515 -
$555 million
- Diluted GAAP earnings per share between $0.18 - $0.24
- Diluted non-GAAP earnings per share between $0.23 - $0.29
(excluding restructuring charges and other costs and amortization
of intangibles)
- This guidance takes into consideration all known constraints
for the quarter and assumes no further significant interruptions to
our supply base, operations or customers. Guidance also assumes no
material changes to end market conditions due to COVID-19.
Restructuring charges are expected to range between $0.8 million and $1.2
million in the second quarter and the amortization of
intangibles is expected to be $1.7
million in the second quarter.
First Quarter 2021 Earnings Conference Call
The
Company will host a conference call to discuss the results today
at 5:00 p.m. Eastern Time. The live webcast of the call
and accompanying reference materials will be accessible by logging
on to the Company's website at www.bench.com. A replay of the
broadcast will also be available until Wednesday, May 5,
2021 on the Company's website.
About Benchmark Electronics, Inc.
Benchmark provides
comprehensive solutions across the entire product life cycle by
leading through its innovative technology and engineering design
services, leveraging its optimized global supply chain and
delivering world-class manufacturing services in the following
industries: commercial aerospace, defense, advanced computing, next
generation telecommunications, complex industrials, medical, and
semiconductor capital equipment. Benchmark's global operations
include facilities in seven countries and its common shares trade
on the New York Stock Exchange under the symbol BHE.
Forward-Looking Statements
This press release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended and Section 21E of the
Securities Exchange Act of 1934, as amended (Exchange Act). These
forward-looking statements are identified as any statement that
does not relate strictly to historical or current facts and may
include words such as "anticipate," "believe," "intend," "plan,"
"project," "forecast," "strategy," "position," "continue,"
"estimate," "expect," "may," "will," "could," "predict," and
similar expressions or the negative or other variations thereof. In
particular, statements, express or implied, concerning future
operating results, our ability to generate sales, income or cash
flow, the anticipated impact of the COVID-19 pandemic, the outlook
and guidance for second quarter 2021 results, our anticipated plans
and responses to the COVID-19 pandemic, our expected revenue mix,
our business strategy and strategic initiatives, our repurchases of
shares of our common stock and our intentions concerning the
payment of dividends, among others, are forward-looking statements.
Although we believe these statements are based upon reasonable
assumptions, they involve risks, uncertainties and assumptions that
are beyond our ability to control or predict, relating to
operations, markets and the business environment generally,
including those discussed under Part I, Item 1A of the company's
Annual Report on Form 10-K for the year ended December 31,
2020 and in any of our subsequent reports filed with the Securities
and Exchange Commission (SEC). In particular, these statements also
depend on the duration, severity and evolution of the COVID-19
pandemic and related risks, including government and other
third-party responses to it and the consequences for the global
economy, our business and the businesses of our suppliers and
customers, as well as our ability (or inability) to execute on our
plans to respond to the COVID-19 pandemic. Should one or more of
these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual outcomes, including the future
results of our operations, may vary materially from those
indicated. Undue reliance should not be placed on any
forward-looking statements. Forward-looking statements are not
guarantees of performance. All forward-looking statements included
in this document are based upon information available to us as of
the date of this document, and we assume no obligation to
update.
Non-GAAP Financial Measures
Management discloses
non–GAAP information to provide investors with additional
information to analyze the Company's performance and underlying
trends. A detailed reconciliation between GAAP results and results
excluding special items ("non-GAAP") is included in the following
tables attached to this document. In situations where a non-GAAP
reconciliation has not been provided, the Company was unable to
provide such a reconciliation without unreasonable effort due to
the uncertainty and inherent difficulty predicting the occurrence,
the financial impact and the periods in which the non-GAAP
adjustments may be recognized. Management uses non–GAAP measures
that exclude certain items in order to better assess operating
performance and help investors compare results with our previous
guidance. This document also references "free cash flow",
which the Company defines as cash flow from operations less
additions to property, plant and equipment and purchased
software. The Company's non–GAAP information is not
necessarily comparable to the non–GAAP information used by 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 a measure of the Company's profitability
or liquidity. Readers should consider the types of events and
transactions for which adjustments have been made.
Benchmark
Electronics, Inc. and Subsidiaries
|
|
Condensed
Consolidated Statements of Income
(Amounts in
Thousands, Except Per Share Data)
(UNAUDITED)
|
|
|
|
Three Months
Ended
|
|
|
|
March 31,
|
|
|
|
2021
|
|
|
2020
|
|
Sales
|
|
$
|
505,721
|
|
|
$
|
514,964
|
|
Cost of
sales
|
|
|
463,494
|
|
|
|
471,603
|
|
Gross
profit
|
|
|
42,227
|
|
|
|
43,361
|
|
Selling, general and
administrative expenses
|
|
|
30,548
|
|
|
|
31,575
|
|
Amortization of
intangible assets
|
|
|
1,598
|
|
|
|
2,381
|
|
Restructuring charges
and other costs
|
|
|
1,591
|
|
|
|
2,915
|
|
Ransomware incident
related costs (recovery), net
|
|
|
(3,444)
|
|
|
|
—
|
|
Income from
operations
|
|
|
11,934
|
|
|
|
6,490
|
|
Interest
expense
|
|
|
(2,149)
|
|
|
|
(1,702)
|
|
Interest
income
|
|
|
165
|
|
|
|
599
|
|
Other income
(expense), net
|
|
|
(276)
|
|
|
|
(662)
|
|
Income before income
taxes
|
|
|
9,674
|
|
|
|
4,725
|
|
Income tax
expense
|
|
|
1,757
|
|
|
|
873
|
|
Net income
|
|
$
|
7,917
|
|
|
$
|
3,852
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.22
|
|
|
$
|
0.10
|
|
Diluted
|
|
$
|
0.22
|
|
|
$
|
0.10
|
|
Weighted-average
number of shares used in calculating
earnings
per share:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
36,250
|
|
|
|
36,790
|
|
Diluted
|
|
|
36,711
|
|
|
|
37,071
|
|
Benchmark
Electronics, Inc. and Subsidiaries
|
|
Condensed
Consolidated Balance Sheets
(UNAUDITED)
(in
thousands)
|
|
|
|
March 31,
|
|
|
December
31,
|
|
|
|
2021
|
|
|
2020
|
|
Assets
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
400,428
|
|
|
$
|
390,808
|
|
Restricted
cash
|
|
|
—
|
|
|
|
5,182
|
|
Accounts receivable,
net
|
|
|
276,287
|
|
|
|
309,331
|
|
Contract
assets
|
|
|
148,205
|
|
|
|
142,779
|
|
Inventories
|
|
|
355,164
|
|
|
|
327,377
|
|
Other current
assets
|
|
|
33,356
|
|
|
|
26,874
|
|
Total current
assets
|
|
|
1,213,440
|
|
|
|
1,202,351
|
|
Property, plant and
equipment, net
|
|
|
183,294
|
|
|
|
185,272
|
|
Operating lease
right-of-use assets
|
|
|
88,915
|
|
|
|
79,966
|
|
Goodwill and other,
net
|
|
|
275,104
|
|
|
|
276,646
|
|
Total
assets
|
|
$
|
1,760,753
|
|
|
$
|
1,744,235
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Current installments
of long-term debt and finance lease obligations
|
|
$
|
9,209
|
|
|
$
|
9,161
|
|
Accounts
payable
|
|
|
325,226
|
|
|
|
282,208
|
|
Advance payments from
customers
|
|
|
76,833
|
|
|
|
84,122
|
|
Accrued
liabilities
|
|
|
93,842
|
|
|
|
105,645
|
|
Total current
liabilities
|
|
|
505,110
|
|
|
|
481,136
|
|
Long-term debt and
finance lease obligations, less current installments
|
|
|
128,862
|
|
|
|
131,051
|
|
Operating lease
liabilities
|
|
|
79,659
|
|
|
|
72,120
|
|
Other long-term
liabilities
|
|
|
69,575
|
|
|
|
70,340
|
|
Shareholders'
equity
|
|
|
977,547
|
|
|
|
989,588
|
|
Total liabilities and
shareholders' equity
|
|
$
|
1,760,753
|
|
|
$
|
1,744,235
|
|
Benchmark
Electronics, Inc. and Subsidiaries
|
|
Condensed
Consolidated Statement of Cash Flows
(in
thousands)
(UNAUDITED)
|
|
|
|
Three Months
Ended
|
|
|
|
March 31,
|
|
|
|
2021
|
|
|
2020
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
7,917
|
|
|
$
|
3,852
|
|
Depreciation and
amortization
|
|
|
11,055
|
|
|
|
12,192
|
|
Stock-based
compensation expense
|
|
|
2,850
|
|
|
|
2,739
|
|
Accounts receivable,
net
|
|
|
32,561
|
|
|
|
6,414
|
|
Contract
assets
|
|
|
(5,426)
|
|
|
|
1,099
|
|
Inventories
|
|
|
(28,700)
|
|
|
|
(23,769)
|
|
Accounts
payable
|
|
|
42,439
|
|
|
|
14,882
|
|
Advance payments from
customers
|
|
|
(7,289)
|
|
|
|
1,785
|
|
Other changes in
working capital and other, net
|
|
|
(18,794)
|
|
|
|
(22,303)
|
|
Net cash
provided by (used in) operations
|
|
|
36,613
|
|
|
|
(3,109)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Additions to property,
plant and equipment and software
|
|
|
(6,422)
|
|
|
|
(12,896)
|
|
Other investing
activities, net
|
|
|
13
|
|
|
|
1,405
|
|
Net cash used
in investing activities
|
|
|
(6,409)
|
|
|
|
(11,491)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Share
repurchases
|
|
|
(13,052)
|
|
|
|
(19,329)
|
|
Net debt
activity
|
|
|
(2,255)
|
|
|
|
92,813
|
|
Other financing
activities, net
|
|
|
(8,453)
|
|
|
|
(6,946)
|
|
Net cash
provided by (used in) financing activities
|
|
|
(23,760)
|
|
|
|
66,538
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes
|
|
|
(2,006)
|
|
|
|
(4,108)
|
|
Net increase in cash
and cash equivalents and restricted cash
|
|
|
4,438
|
|
|
|
47,830
|
|
Cash and cash
equivalents and restricted cash at beginning of year
|
|
|
395,990
|
|
|
|
363,956
|
|
Cash and cash
equivalents and restricted cash at end of year
|
|
$
|
400,428
|
|
|
$
|
411,786
|
|
Benchmark
Electronics, Inc. and Subsidiaries
|
|
Reconciliation of
GAAP to Non-GAAP Financial Results
(Amounts in
Thousands, Except Per Share Data)
(UNAUDITED)
|
|
|
|
Three Months
Ended
|
|
|
|
March 31,
|
|
|
December
31,
|
|
|
March 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2020
|
|
Income from
operations (GAAP)
|
|
$
|
11,934
|
|
|
$
|
11,857
|
|
|
$
|
6,490
|
|
Restructuring charges
and other costs
|
|
|
1,591
|
|
|
|
4,490
|
|
|
|
1,908
|
|
Ransomware incident
related costs (recovery), net
|
|
|
(3,444)
|
|
|
|
(45)
|
|
|
|
—
|
|
Impairment
|
|
|
—
|
|
|
|
—
|
|
|
|
1,007
|
|
Customer insolvency
(recovery)
|
|
|
(32)
|
|
|
|
(553)
|
|
|
|
—
|
|
Amortization of
intangible assets
|
|
|
1,598
|
|
|
|
1,979
|
|
|
|
2,381
|
|
Non-GAAP income from
operations
|
|
$
|
11,647
|
|
|
$
|
17,728
|
|
|
$
|
11,786
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit
(GAAP)
|
|
$
|
42,227
|
|
|
$
|
50,661
|
|
|
$
|
43,361
|
|
Customer insolvency
(recovery)
|
|
|
(32)
|
|
|
|
(553)
|
|
|
|
—
|
|
Non-GAAP gross
profit
|
|
$
|
42,195
|
|
|
$
|
50,108
|
|
|
$
|
43,361
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(GAAP)
|
|
$
|
7,917
|
|
|
$
|
7,695
|
|
|
$
|
3,852
|
|
Restructuring charges
and other costs
|
|
|
1,591
|
|
|
|
4,490
|
|
|
|
1,908
|
|
Ransomware incident
related costs (recovery), net
|
|
|
(3,444)
|
|
|
|
(45)
|
|
|
|
—
|
|
Customer insolvency
(recovery)
|
|
|
(32)
|
|
|
|
(553)
|
|
|
|
—
|
|
Amortization of
intangible assets
|
|
|
1,598
|
|
|
|
1,979
|
|
|
|
2,381
|
|
Impairment
|
|
|
—
|
|
|
|
—
|
|
|
|
1,007
|
|
Income tax
adjustments(1)
|
|
|
169
|
|
|
|
(1,006)
|
|
|
|
(1,078)
|
|
Non-GAAP net
income
|
|
$
|
7,799
|
|
|
$
|
12,560
|
|
|
$
|
8,070
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
(GAAP)
|
|
$
|
0.22
|
|
|
$
|
0.21
|
|
|
$
|
0.10
|
|
Diluted
(Non-GAAP)
|
|
$
|
0.21
|
|
|
$
|
0.34
|
|
|
$
|
0.22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
number of shares used in
|
|
|
|
|
|
|
|
|
|
|
|
|
calculating diluted
earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
(GAAP)
|
|
|
36,711
|
|
|
|
36,596
|
|
|
|
37,071
|
|
Diluted
(Non-GAAP)
|
|
|
36,711
|
|
|
|
36,596
|
|
|
|
37,071
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
(used in) operations
|
|
$
|
36,613
|
|
|
$
|
94,823
|
|
|
$
|
(3,109)
|
|
Additions to
property, plant and equipment and software
|
|
|
(6,422)
|
|
|
|
(10,417)
|
|
|
|
(12,896)
|
|
Free cash flow (free
cash flow used)
|
|
$
|
30,191
|
|
|
$
|
84,406
|
|
|
$
|
(16,005)
|
|
|
(1) This
amount represents the tax impact of the non-GAAP adjustments using
the applicable effective tax rates.
|
View original content to download
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SOURCE Benchmark Electronics, Inc.