Sanmina-SCI announces Q2 results
Apr 28, 2005
Sanmina-SCI Corporation (Nasdaq: SANM) reported financial results for its second fiscal quarter ended April 2, 2005.
Second Quarter Fiscal 2005 Highlights Include:
-- Revenues of $2.89 billion
-- Non-GAAP net income of $29.3 million and Non-GAAP EPS of $0.06
-- GAAP Net loss of $1,035.5 million and GAAP loss per share of $1.99
-- Pre-tax charge of a $600 million for impairment of goodwill and other long-lived assets
-- Recorded Valuation allowance against deferred tax asset $379 MILLION
-- Cash flow from Operations of approximately $122 million
-- Inventory turns 11.4x
For the second quarter ended April 2, 2005, Sanmina-SCI reported revenues of $2.89 billion, compared to $2.86 billion in the second quarter of fiscal 2004 which ended March 27, 2004.
Non-GAAP net income for the second quarter 2005 was $29.3 million, or $0.06 non-GAAP diluted earnings per share, compared to non-GAAP net income of $26.6 million, and non-GAAP diluted earnings per share of $0.05, for the same period last year and compared to non-GAAP net income of $45.7 million, and $0.09 non-GAAP diluted earnings per share in the first quarter ended January 1, 2005. Non-GAAP operating income for the quarter was $55.8 million. As described below, non-GAAP financial results do not include integration and restructuring costs, impairment charges, and other infrequent or unusual items and non-cash interest and amortization expense. As so defined, non-GAAP financial results do not include the aforementioned valuation allowance against deferred tax assets or the impairment charge against goodwill or other long lived assets.
For the second quarter of fiscal 2005, the company reported a GAAP net loss of $1.035.5 million or GAAP diluted loss per share of $1.99. Operating loss on a GAAP basis for the second quarter was $604.1 million.
Jure Sola, Chairman and Chief Executive Officer of Sanmina-SCI, said, "As we've previously discussed, our restructuring activities are proceeding as planned, but unfortunately our success in doing so has negative accounting consequences associated with certain non-cash assets that relate to our high-cost regions, primarily in the United States. Notwithstanding these write-downs we have had to absorb this quarter, we believe our restructuring activities will enhance our competitiveness in the market and yield positive returns for our shareholders."
At April 2, 2005, the company reported an 11% increase to $1.2 billion in cash and short-term investments as compared to $1.1 billion in the prior quarter. Cash provided by operations during the second quarter was approximately $122 million. At quarter-end, the Company reported a current ratio of 1.7, working capital of $1.7 billion, and stockholders' equity of $2.4 billion.
"Total revenues for the second quarter reflect the traditional seasonality of the EMS industry. As expected, results from our personal and business computing systems group were soft. Importantly, despite this seasonality, revenues in our EMS and components operations were comparable with the prior quarter. We believe this achievement reflects the improving fundamentals of our high-end technology markets.
"We continue to align our marketing and manufacturing organization to capitalize on our core competencies in providing customers with end-to-end, technology-driven solutions at reduced cost. Continuous improvement programs are being implemented throughout our operations. These programs, which are designed to enhance future growth by leveraging our unique skill set to add value to our customers, will allow us to take advantage of the growing demand for outsourcing in the electronics industry," Sola concluded.
The following statements are based on current expectations. These statements are forward-looking and actual results may differ materially. Please refer to the Risk Factors reported in the company's annual and quarterly reports on file with the Securities Exchange Commission for a description of some of the factors that could influence the company's ability to achieve the projected results.
The company provides the following guidance with respect to its third fiscal quarter ending July 2, 2005:
-- Revenue is expected to be in the range of $2.8 billion to $3.0 billion;
-- Non-GAAP diluted earnings per share to be between $0.05 and $0.07 excluding integration and restructuring costs, impairment charges, other infrequent or unusual items and non-cash interest and amortization expense.