Sanmina Achieves Record Third Quarter Results
SAN JOSE, Calif., July 19 /PRNewswire/ -- Sanmina Corporation (Nasdaq: SANM - news), a leading electronics contract
manufacturer, today reported financial results for its third quarter and nine-months period ended July 3, 1999. Results for the third
quarter and nine months ended June 27, 1998 have been restated to give effect to Sanmina's mergers.
Third quarter fiscal 1999 highlights include:
SANMINA CONTINUED RECORD REVENUES AND NET INCOME
NET INCOME ADVANCES 26.6 PERCENT TO $31.4 MILLION
RECORD DILUTED EARNINGS PER SHARE OF $0.51
SUCCESSFULLY COMPLETED OFFERING OF $350 MILLION CONVERTIBLE
SUBORDINATED NOTES TO SUPPORT AGGRESSIVE GROWTH STRATEGY
Summary of Financial Results:
(thousands, except per share data) Q3:99 Q3:98 9MOS99* 9MOS98*
Revenues $309,496 $267,617 $866,169 $729,174
Operating margin 15.4% 14.4% 10.3% 13.5%
Operating income $47,595 $38,454 $88,798 $98,592
Net income $31,358 $24,761 $59,568 $63,591
EPS -- basic $0.54 $0.50 $1.03 $1.29
EPS -- diluted $0.51 $0.43 $0.97 $1.13
*includes non-recurring charges expenses
Continued Strong Revenue and Earnings Growth
For the third quarter, revenues grew over 15 percent to $309.5 million from $267.6 million in the third quarter of fiscal 1998. Net
income advanced nearly 27 percent to $31.4 million, or $0.51 per diluted share, from $24.8 million, or $0.43 per diluted share, in
the third quarter last year.
Gross profit for the quarter rose over 16 percent to $66.4 million from $56.9 million in the same period last year, and operating
income increased nearly 24 percent to $47.6 million from $38.5 million in the third quarter a year ago. For the quarter, Sanmina's
operating margin increased to 15.4 percent from 14.4 percent. The quarter-over-quarter increase in operating margin reflects the
Company's ability to leverage its infrastructure over a larger revenue base as Sanmina continues to maintain tight control over
expenses.
At July 3, 1999, Sanmina reported $482.9 million in cash and short-term investments. The Company had a current ratio of 5:1,
strong working capital of $659.5 million, which benefited from the offering of convertible subordinated notes, and shareholders'
equity of $566.5 million.
Accelerating Growth Strategy
Sanmina's Chairman and Chief Executive Officer Jure Sola said, ''Serving the fastest-growing segments of the $95 billion global
electronic manufacturing services (EMS) market, Sanmina continues to post solid revenue and earnings growth. By providing an
unparalleled level of customer service and effective asset management, we believe Sanmina is well positioned to extend its leading
role in this industry.
''It is our goal to increase market share more aggressively. Our newly formed business development group is actively pursuing
appropriate strategic acquisitions based on a variety of criteria, including technology, geographic presence, customer base, and
revenue growth. To support our growth objectives, we recently completed an offering of convertible subordinated notes, generating
approximately $350 million, significantly strengthening our balance sheet.''
Providing Enhanced Technology Solutions
''After the quarter closed, we announced the opening of our new R&D lab located in Irvine, California, which focuses on emerging
materials and processes, such as high-density PCBs and multi-chip modules using wirebondable gold and flip chip for silicon
attachment,'' added Mr. Sola. ''We remain committed to enhancing our technological capabilities as the industry migrates toward
using more advanced technologies and processes.
''Our growth stems from our ability to meet customer demand for a wide range of high-end electronics manufacturing services and
creative engineering solutions. By capitalizing on current industry trends and leveraging our strength in the market, we remain
confident in our ability to sustain or, more probably, accelerate our current rate of growth,'' concluded Mr. Sola.
Results for Nine Months
For the first nine months ended July 3, 1999, revenues rose approximately 19 percent to $866.2 million from $729.2 million for the
first nine months of fiscal 1998. Including non-recurring charges related to plant closings and relocation and other merger-related
costs, net income for the nine-month period was $59.6 million, or $0.97 per diluted share, compared with net income of $63.6
million, or $1.13 per diluted share, for the same period a year ago. Excluding non-recurring expenses for both nine-month periods,
net income increased to $87.8 million, or $1.43 per diluted share, from net income of $65.9, or $1.17 per diluted share, in the
nine-months ended June 27, 1998.
Company Profile
Sanmina Corporation is a leading electronics contract manufacturing services company providing a full spectrum of integrated,
value-added electronic manufacturing services. Services include the manufacture of complex printed circuit board assemblies,
custom-designed backplane assemblies and subassemblies, multi-layered printed circuit boards and custom cable and wire harness
assemblies, and the testing and assembly of electronic sub-systems and systems. The company provides these services to a
diversified base of leading OEMs in the communications, industrial and medical instrumentation and computer sectors of the
electronics industry. Sanmina common stock trades on the Nasdaq National Market under the symbol: SANM. Information regarding
Sanmina can be found on its World Wide Web page located at sanmina.com .
Safe Harbor Statement
The foregoing, including the discussion regarding the company's future prospects, contains certain forward-looking statements that
involve risks and uncertainties, including uncertainties associated with economic conditions in the electronics industry, particularly in
the principal industry sectors served by the company, changes in customer requirements and in the volume of sales to principal
customers, the ability of the company to assimilate acquired businesses and to achieve the anticipated benefits of such acquisitions,
and competition and technological change. The company's actual results of operations may differ significantly from those
contemplated by such forward-looking statements as a result of these and other factors, including factors set forth in the company's
1998 Annual Report on Form 10-K/A filed with the Securities Exchange Commission on filed May 3, 1999 and the company's most
recent quarterly 10-Q report filed May 17, 1999.
SANMINA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
July 3, June 27, July 3, June 27,
1999 1998 1999 1998
Net sales $309,496 $267,617 $866,169 $729,174
Cost of sales 243,122 210,676 685,896 575,025
Gross profit 66,374 56,941 180,273 154,149
Operating expenses:
Selling, general
and administrative 17,924 17,593 55,311 49,379
Amortization of goodwill 855 894 2,410 2,233
Provision for plant closing
and relocation -- -- 16,875 --
Write-down of long-lived
assets -- -- 11,400 --
Merger costs -- -- 5,479 3,945
Total operating expenses 18,779 18,487 91,475 55,557
Income from operations 47,595 38,454 88,798 98,592
Other income (expense), net 1,787 (245) 5,334 (174)
Income before provision
for income taxes 49,382 38,209 94,132 98,418
Provision for income taxes 18,024 13,448 34,564 34,827
Net income $31,358 $24,761 $59,568 $63,591
Earnings per share:
Basic $0.54 $0.50 $1.03 $1.29
Diluted $0.51 $0.43 $0.97 $1.13
Shares used in computing
per share amounts:
Basic 58,242 49,828 57,790 49,463
Diluted 61,847 58,921 61,450 58,563
SANMINA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
July 3, April 3,
1999 1999
ASSETS
Current Assets:
Cash and short-term investments $482,942 $130,031
Accounts receivable, net 165,660 160,665
Inventories 142,004 126,037
Prepaid and other 35,467 32,955
Total current assets 826,073 449,688
Property and equipment, net 194,878 187,947
Long-term investments 52,850 52,850
Deposits and other 27,379 21,810
Total assets $1,101,180 $712,295
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $94,578 $108,460
Accrued liabilities and other 71,996 57,920
Total current liabilities 166,574 166,380
Long-term debt and other liabilities 12,523 15,082
Convertible subordinated notes 355,602 5,647
Stockholders' equity 566,481 525,186
Total liabilities and stockholders' equity $1,101,180 $712,295
SOURCE: Sanmina Corporation |
