Company Reports Second Quarter Revenue Increases 38%
MILPITAS, Calif., March 16 /PRNewswire/ --Solectron Corporation
(NYSE: SLR) today announced record sales for the second quarter of fiscal
1998, ended February 27, 1998. Revenues increased 38% from the second quarter
of fiscal 1997 to $1,186.8 million for fiscal 1998. Net income for the quarter
was up 30% from the second quarter of fiscal 1997 to $48.8 million for fiscal
1998.
Diluted earnings per share for the second quarter were $0.41 compared to
$0.32 for the second quarter of last year. Solectron's second quarter
operating margin was 6.2% and its annualized return on equity was 19.4%.
"We are very pleased with our operational results for the second quarter,"
said Dr. Ko Nishimura, Solectron chairman, president and CEO. "During this
past quarter, we continued to invest in our infrastructure designed to sustain
and propel our rapid growth. It is due to this infrastructure and our common
process initiatives that we were able to successfully ramp-up faster than
anticipated with several major new customers at various Solectron operations
around the world."
Founded in 1977, Solectron Corporation (www.solectron.com) is a worldwide
provider of pre-manufacturing, manufacturing and post manufacturing services
to leading electronics original equipment manufacturers (OEMs). Solectron
offers its customers competitive outsourcing advantages such as access to
advanced manufacturing technologies, shortened product time-to-market, reduced
cost of production and more effective asset utilization.
The Company has received more than 140 quality and service awards from its
customers in addition to the 1991 and 1997 Malcolm Baldrige National
Quality Awards. Solectron is the first company to win the Malcolm Baldrige
National Quality Award for Manufacturing twice in the 10-year history of the
national program. Solectron has 20,000 employees in 18 manufacturing
facilities worldwide with more than four million square feet of manufacturing
capacity. Revenues for fiscal year ended August 31, 1997 were $3.7 billion.
SOLECTRON CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(unaudited)
Three Months Ended Six Months Ended
Feb 27 Feb 28 Feb 27 Feb 28
1998 1997 1998 1997
Net sales $ 1,186,831 $ 858,698 $ 2,323,651 $ 1,666,423
Cost of sales 1,060,669 756,500 2,073,730 1,478,077
Gross profit 126,162 102,198 249,921 188,346
Operating expenses:
Selling, general
& administrative 47,985 42,512 99,924 75,184
Research & development 4,945 4,123 9,327 5,313
Acquisition Costs 0 0 0 4,000
Operating income 73,232 55,563 140,670 103,849
Interest income 6,542 7,536 13,119 13,749
Interest expense (6,326) (6,183) (12,839) (12,994)
Income before income
taxes 73,448 56,916 140,950 104,604
Income taxes 24,605 19,351 47,219 35,564
Net income $ 48,843 $ 37,565 $ 93,731 $ 69,040
Net income per share:
Basic $ 0.42 $ 0.33 $ 0.81 $ 0.63
Diluted $ 0.41 $ 0.32 $ 0.78 $ 0.61
Shares used in computation:
Basic 115,414 112,552 115,124 109,220
Diluted 126,164 116,439 126,100 113,019
E.P.S. for 1997 has been recalculated in compliance with Statement of
Financial Accounting Standards #128.
See accompanying notes to interim consolidated financial statements
SOLECTRON CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
Feb 27 Aug 29
1998 1997
(unaudited)
ASSETS
Current assets:
Cash, cash equivalents and
short-term investments $ 426,121 $ 482,902
Accounts receivable, net 480,318 418,682
Inventories 582,728 494,622
Prepaid expenses and other current
assets 86,755 79,426
Total current assets 1,575,922 1,475,632
Net property and equipment 388,024 326,361
Other assets 52,709 50,426
Total assets $ 2,016,655 $ 1,852,419
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt
and capital lease obligations $ (195) $ 1,464
Accounts payable 475,641 415,896
Accrued employee compensation 46,526 56,218
Accrued expenses 10,666 24,787
Other current liabilities 64,480 45,577
Total current liabilities 597,118 543,942
Long-term debt and capital lease
obligations 386,343 385,850
Other long-term liabilities 2,779 3,558
Total liabilities 986,240 933,350
Shareholders' equity:
Common stock 115 115
Additional paid-in capital 467,683 451,093
Retained earnings 572,337 478,612
Cumulative translation adjustment (9,720) (10,751)
Total shareholders' equity 1,030,415 919,069
Total liabilities and shareholders'
equity $ 2,016,655 $ 1,852,419 |
