Press Release: Benchmark Reports Fourth Quarter And Full Year 2020 Results

· 02/04/2021 16:07

-- Revenue between $480 - $520 million -- Diluted GAAP earnings per share between $0.11 - $0.14 -- Diluted non-GAAP earnings per share between $0.18 - $0.22 (excluding restructuring charges and other costs and amortization of intangibles) -- This guidance takes into consideration all known constraints for the quarter and assumes no further significant interruptions to our supply base, operations or customers. Guidance also assumes no material changes to end market conditions due to COVID-19.Dec 31, Sep 30, Dec 31, Higher-Value Markets 2020 2020 2019 ------------------- Medical $111 21 % $134 26 % $103 20 % Semi-Cap 101 20 99 19 81 16 A&D 111 21 105 20 106 21 Industrials 97 19 86 16 107 21 $420 81 % $424 81 % $397 78 % Dec 31, Sep 30, Dec 31, Traditional Markets 2020 2020 2019 ------------------- Computing $46 9 % $44 8 % $45 9 % Telecommunications 55 10 58 11 66 13 $101 19 % $102 19 % $111 22 % Total $521 100% $526 100% $508 100%Dec 31, Sep 30, Dec 31, 2020 2020 2019 Accounts receivable days 53 52 57 Contract asset days 25 28 29 Inventory days 63 66 60 Accounts payable days (54) (54) (58) Advance payments from customers days (16) (11) (7) Cash Conversion Cycle days 71 81 81Three Months Ended Dec 31, Sep 30, Dec 31, In millions, except EPS 2020 2020 2019 ----------------------- Sales $ 521 $ 526 $508 Net income (loss)(2) $ 8 $ 6 $(7) Net income -- non-GAAP(1)(2) $ 13 $ 12 $10 Diluted earnings (loss) per share(2) $ 0.21 $ 0.16 $(0.19) Diluted EPS -- non-GAAP(1)(2) $ 0.34 $ 0.32 $0.27 Operating margin(2) 2.3 % 1.6 % (1.8) % Operating margin -- non-GAAP(1)(2) 3.4 % 3.0 % 2.6 % Twelve Months Ended Dec 31, Dec 31, In millions, except EPS 2020 2019 --------------------------------------- Net sales $ 2,053 $2,268 Net income(3) $ 14 $23 Net income -- non-GAAP(1)(3) $ 35 $51 Diluted EPS(3) $ 0.38 $0.60 Diluted EPS -- non-GAAP(1)(3) $ 0.95 $1.32 Operating margin(3) 1.2 % 1.3 % Operating margin -- non-GAAP(1)(3) 2.5 % 3.0 % (1) A reconciliation of GAAP and non-GAAP results is included below. (2) Results for the fourth quarter ended December 31, 2020 and third quarter ended September 30, 2020 include the impact of approximately $1.6 million and $1.3 million of net COVID-19 related costs, respectively. (3) Results for the year ended December 31, 2020 include the impact of approximately $7.1 million of net COVID-19 related costs.

Benchmark Reports Fourth Quarter And Full Year 2020 Results

Fourth quarter 2020 results:

- Revenue of $521 million

- GAAP gross margin of 9.7% and non-GAAP gross margin of 9.6%

- Cash flow generated from operations of $95 million

- GAAP diluted EPS of $0.21 and non-GAAP diluted EPS of $0.34

Full year 2020 results:

- Revenue of $2.1 billion

- Semi-Cap revenue growth of 33% year-over-year

- Medical revenue growth of 11% year-over-year

- Higher-value markets revenue mix greater than 80%

- Cash flow generated from operations of $120 million and free cash flow of $81 million

- Annual GAAP diluted EPS of $0.38 and non-GAAP diluted EPS of $0.95

PR Newswire

TEMPE, Ariz., Feb. 4, 2021

TEMPE, Ariz., Feb. 4, 2021 /PRNewswire/ -- Benchmark Electronics, Inc. (NYSE: BHE) today announced financial results for the fourth quarter and year ended December 31, 2020.

Jeff Benck, Benchmark's President and CEO stated, "We closed out a very challenging year, delivering fourth quarter results that not only met our expectations, but demonstrated sequential improvement in both non-GAAP gross margins at 9.6% and higher non-GAAP earnings at $0.34 enabled by higher-value sector mix and improved utilization across the company. I am very proud of our team, which has proven to be very resourceful and resilient in the face of this pandemic and continues to deliver for our customers."

Benck continued, "Our focused efforts on improving working capital management are also bearing fruit as we generated $95 million of operating cash flow in the quarter and over $120 million for the year, which exceeded our forecast. I look forward to 2021 with optimism knowing that our strategic investments in the business to drive differentiated value and sustainability have solidified a path to achieve revenue, margin, and earnings growth in 2021 aligned with our mid-term financial goals."

Cash Conversion Cycle

Fourth Quarter 2020 Industry Sector Update

Revenue and percentage of sales by industry sector (in millions) was as follows.

Overall, higher-value market revenues were up 6% year-over-year from strength in the Semi-Cap, Medical, and A&D sectors. Traditional market revenues were down from program transitions.

First Quarter 2021 Outlook

Restructuring charges are expected to range between $1.0 million and $2.0 million in the first quarter and the amortization of intangibles is expected to be $2.0 million in the first quarter.

Fourth Quarter 2020 and CY2020 Earnings Conference Call

The Company will host a conference call to discuss the results today at 5:00 p.m. Eastern Time. The live webcast of the call and accompanying reference materials will be accessible by logging on to the Company's website at www.bench.com. A replay of the broadcast will also be available until Thursday, February 11, 2021 on the Company's website.

About Benchmark Electronics, Inc.

Benchmark provides comprehensive solutions across the entire product life cycle by leading through its innovative technology and engineering design services, leveraging its optimized global supply chain and delivering world-class manufacturing services in the following industries: commercial aerospace, defense, advanced computing, next generation telecommunications, complex industrials, medical, and semiconductor capital equipment. Benchmark's global operations include facilities in seven countries and its common shares trade on the New York Stock Exchange under the symbol BHE.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The words "expect," "estimate," "anticipate," "could", "predict" and similar expressions, and the negatives thereof, often identify forward-looking statements, which are not limited to historical facts. Forward-looking statements include, among other things, the estimated financial impact of the COVID-19 pandemic, our outlook and guidance for first quarter 2021 results, the company's anticipated plans and responses to the COVID-19 pandemic, statements (express or implied) concerning future operating results or margins, the ability to generate sales and income or cash flow, and expected revenue mix, and Benchmark's business and growth strategies. Although the company believes these statements are based on and derived from reasonable assumptions, they involve risks and uncertainties relating to operations, markets and the business environment generally. These statements also depend on the duration and severity of the COVID-19 pandemic and related risks, including government and other fourth-party responses to the crisis and the consequences for the global economy, our business and the businesses of our suppliers and customers. Events relating to or resulting from the COVID-19 pandemic, including the possibility of customer demand fluctuations, supply chain constraints, or the ability to utilize our manufacturing facilities at sufficient levels to cover our fixed operating costs, may have resulting impacts on the company's business, financial condition, results of operations, and the company's ability (or inability) to execute on its plans to respond to the COVID-19 pandemic. If one or more of these risks or uncertainties materializes, or underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated. Readers are advised to consult further disclosures on these risks and uncertainties, particularly in Part 1, Item 1A, "Risk Factors" of the Company's Annual Report on Form 10-K for the year ended December 31, 2019 and in Part II, Item 1A, "Risk Factors" in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2020 and in its subsequent filings with the Securities and Exchange Commission. All forward-looking statements included in this document are based upon information available to the company as of the date of this document, and it assumes no obligation to update them.

Non-GAAP Financial Measures

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February 04, 2021 16:07 ET (21:07 GMT)