Plexus Announces Fiscal Second Quarter 2019 Financial Results and Guidance for Fiscal Third Quarter

  • Record quarterly revenue of $789 million during the fiscal second quarter of 2019
  • GAAP diluted EPS of $0.79
  • Initiates fiscal third quarter 2019 revenue guidance of $760 to $800 million with GAAP diluted EPS of $0.76 to $0.86

NEENAH, Wis., — Plexus (NASDAQ: PLXS) announced financial results for its fiscal second quarter ended March 30, 2019, and guidance for its fiscal third quarter ending June 29, 2019.

Three Months Ended
Mar 30, 2019 Mar 30, 2019 Jun 29, 2019
Q2F19 Results Q2F19 Guidance Q3F19 Guidance
Summary GAAP Items
Revenue (in millions) $789 $760 to $800 $760 to $800
Operating margin   4.2% 4.3% to 4.7% 4.3% to 4.7%
Diluted EPS (1) $0.79 $0.80 to $0.90 $0.76 to $0.86
Summary Non-GAAP Items (2)
Return on invested capital (ROIC)   13.3%
Economic return   4.3%
(1) Includes stock-based compensation expense of $0.16 for Q2F19 results and $0.17 for Q3F19 guidance.
(2) Refer to Non-GAAP Supplemental Information in Tables 1 and 2 for non-GAAP financial measures and a reconciliation to GAAP.

Fiscal Second Quarter 2019 Information

  • Won 36 manufacturing programs during the quarter representing $247 million in annualized revenue when fully ramped into production
  • Trailing four quarter manufacturing wins total $912 million in annualized revenue when fully ramped into production
  • Purchased $56.2 million of our shares at an average price of $56.72 per share under our existing share repurchase program

Todd Kelsey, President and CEO, commented, “In the fiscal second quarter, we continued to deliver meaningful growth with record quarterly revenue of $789 million, a 13% increase over the comparable quarter last year.  Sizable customer mix changes that occurred within the quarter created cost inefficiencies, resulting in operating margin and EPS slightly below our guidance ranges.”

Patrick Jermain, Executive Vice President and CFO, commented, “During the fiscal second quarter, we continued our cash repatriation strategy by repatriating approximately $28 million of offshore cash.  We repurchased approximately $56 million of our shares, which was partially funded with repatriated cash. Since the enactment of U.S. tax reform last year, we have brought back close to $480 million.”

Mr. Jermain continued, “Although working capital requirements were greater than anticipated during the fiscal second quarter, we are reconfirming our full fiscal year expectation for free cash flow in the range of $40 to $60 million.”

Mr. Kelsey continued, “As we look to the fiscal third quarter, we expect weakness in our Communications sector to offset anticipated growth in our Aerospace/Defense and Healthcare/Life Sciences sectors.  As a result, we are guiding relatively flat revenue in the range of $760 to $800 million.  At this revenue level, we anticipate GAAP EPS in the range of $0.76 to $0.86, with operating margins modestly below our target range.  Further, we are implementing productivity and cost containment actions that, in conjunction with our current revenue expectations, are designed to support a return to our target operating margin range in the fiscal fourth quarter.”

Mr. Kelsey concluded, “We remain confident in our revenue outlook and maintain our expectation of solid growth in fiscal 2019.  Demand remains robust in many of our end markets, and our teams continue to achieve strong wins performance throughout our differentiated portfolio, producing $247 million of new manufacturing wins in the fiscal second quarter.  While we continue to deliver the highest operating margin among our peers, we are committed to taking the necessary actions to consistently deliver our target range of 4.7% to 5.0%.”