Jabil's 3Q Net Rose 11%; Revenue Fell 19%
DJ NEWSWIRES
ST. PETERSBURG, Fla. -- Jabil Circuit's net income rose 11% in its fiscal third quarter, despite a 19% drop in revenue. The contract-manufacturer, which makes products for big technology companies, late Tuesday reported net income of $20.8 million, or 10 cents a share, for the quarter ended May 31, compared with net income of $18.8 million, or nine cents a share, a year earlier.
The latest results included about $700,000 of charges related to the acquisitions of certain operations of Compaq Computer, Alcatel Business Systems and Valeo SA; and $2.9 million of intangible amortization. Year-earlier results included $2.4 million in charges related to the acquisition of certain operations of Marconi Communications; $10.6 million of restructuring charges, and $599,000 of intangible amortization.
Excluding these items, the company said it would have posted earnings of $24.4 million, or 12 cents a share, in the latest quarter, compared with earnings of $32.3 million, or 16 cents a share, a year earlier.
The mean estimate of analysts surveyed by Thomson Financial/First Call was for earnings of 11 cents a share.
Revenue fell to $850.6 million from $1.05 billion a year earlier, but came in at the high end of Jabil's projection of $825 million to $855 million.
"During the quarter we were able to achieve sequential growth in both revenue and profitability," Tim Main, Jabil's president and chief executive, said in a prepared statement. "In addition, our focus on our balance sheet management yielded improved inventory turns, sales cycle and operating cash flow.
"We believe these improvements will provide Jabil a strong foundation as we resume our experience as a growth company in a growth industry."
For the fiscal fourth quarter, Jabil said it expects earnings of 14 cents to 16 cents a share, as the company anticipates growth in the automotive, computing and storage, instrumentation and medical, peripheral and networking sectors. The hard-hit telecommunications sector continues to have lower production levels, Jabil warned.
The company's projected range brackets analysts' estimate of 15 cent a share, according to Thomson Financial/First Call, and is higher than year-earlier earnings of six cents a share.
Jabil also said it believes customer forecasts hint that production levels will increase in the fiscal fourth quarter and projected revenue of $920 million to $960 million, below analysts' projection of $973.2 million. The company reported revenue of $944.1 million a year earlier.
The company, which posted $32.4 million in third-quarter operating income, expects this figure to increase by 10% to 20% sequentially in the fourth quarter because of incremental revenue growth and ongoing operational activity.
For the fiscal full-year, Jabil expects to post earnings of 45 cents to 47 cents a share, lowering the high end of its previous guidance of 45 cents to 50 cents a share. Analysts expect earnings of 45 cents a share, according to Thomson Financial/First Call. In fiscal 2001, Jabil posted earnings, excluding items, of 73 cents a share.
Jabil , which had projected year revenue of $3.5 billion to $4 billion, now expects revenue for the year to come in at $3.5 billion, in line with analysts' estimate. Jabil had $4.33 billion in 2001 revenue. The company reported results after the regular close of trading Tuesday. As of 4 p.m. shares of Jabil were at $19.15, down $1, or 5%.
Herb Greenberg/Street.Com: Jabil and Cisco Again
6/18/02 05:54 PM ET
Jabil's networking business was up only 2% sequentially. The estimate was 4% to 5%. And for what it's worth: It's a preferred supplier of Cisco (CSCO:Nasdaq) equipment.
Clarification from my money-management source, regarding Jabil and Cisco: While Jabil's networking sales were down from what was expected, the company guided up 10% in networking. However, it'll be up not because of strong organic growth, but because Jabil acquired a large networking operation from Alcatel and won new business from Cisco. Cisco, you'll recall, had previously discussed Europe and Japan as some of its strong areas. But Tuesday Apple (AAPL) cited those regions for its weakness. The suggestion, my source says, is that if Jabil's organic networking growth is down, Cisco's might be too. |
