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BENCHMARK REPORTS FIRST QUARTER 2023 RESULTS
Press Releases

BENCHMARK REPORTS FIRST QUARTER 2023 RESULTS

First quarter 2023 results:

  • Revenue of $695 million, up 9% year-over-year led by:
    • Advanced Computing growth of 74%
    • Medical growth of 17%
    • Next Generation Communications growth of 45%
  • GAAP operating income of $23 million, up 48% year-over-year
  • Non-GAAP(1) operating income of $26 million, up 21% year-over-year
  • GAAP diluted EPS of $0.35, up 13% year-over-year

TEMPE, Ariz., May 3, 2023 /PRNewswire/ — Benchmark Electronics, Inc. (NYSE: BHE) today announced financial results for the first quarter ended March 31, 2023.

 



Three Months Ended




March 31,



Dec 31,



March 31,


In millions, except EPS


2023



2022



2022


Sales


$

695



$

751



$

636


Net income


$

12



$

21



$

11


Income from operations


$

23



$

27



$

15


Net income – non-GAAP(1)


$

15



$

21



$

16


Income from operations – non-GAAP(1)


$

26



$

33



$

21


Diluted earnings per share


$

0.35



$

0.60



$

0.31


Diluted EPS – non-GAAP(1)


$

0.42



$

0.60



$

0.44


Operating margin



3.3

%



3.6

%



2.4

%

Operating margin – non-GAAP(1)



3.7

%



4.3

%



3.4

%



 (1)    A reconciliation of GAAP and non-GAAP results is included below.

“Our first quarter results include double-digit year-over-year product shipment growth despite the pause in Semi-Cap spending, demonstrating the power of our sector diversification,” said Jeff Benck, Benchmark’s President and CEO.

Benck continued “While 2023 has already been a dynamic year, we are encouraged by the demand trends we are experiencing across the majority of our sectors.  Coupled with our continued execution, we remain confident in our outlook for the current year as well as our ability to execute to our long-term targets.”

Cash Conversion Cycle



Mar 31,



Dec 31,



Mar 31,




2023



2022



2022


Accounts receivable days



60




59




54


Contract asset days



25




22




24


Inventory days



111




97




95


Accounts payable days



(60)




(56)




(71)


Advance payments from customers days



(27)




(26)




(20)


Cash Conversion Cycle days



109




96




82


First Quarter 2023 Industry Sector Update

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



Mar 31,



Dec 31,



Mar 31,


Higher-Value Markets


2023



2022



2022


Medical


$

137




20

%


$

144




19

%


$

117




18

%

Semi-Cap



149




21




178




24




183




29


A&D



79




11




90




12




82




13


Industrials



144




21




143




19




137




22


Advanced Computing



96




14




92




12




55




8


Next Gen Communications



90




13




104




14




62




10


Total


$

695




100

%


$

751




100

%


$

636




100

%

Overall, revenues were up 9% year-over-year from strength in the Advanced Computing, Next Gen Communications,  Industrials, and Medical sectors.

Second Quarter 2023 Guidance

  • Revenue between $670$710 million
  • Diluted GAAP earnings per share between $0.35$0.41
  • Diluted non-GAAP earnings per share between $0.43$0.49 (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.

Restructuring charges are expected to range between $1.8 million and $2.2 million in the second quarter and the amortization of intangibles is expected to be $1.6 million in the second quarter.

First Quarter 2023 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 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, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are identified as any statement that does not relate strictly to historical or current facts and may include words such as “anticipate,” “believe,” “intend,” “plan,” “project,” “forecast,” “strategy,” “position,” “continue,” “estimate,” “expect,” “may,” “will,” “could,” “predict,” and similar expressions of the negative or other variations thereof. In particular, statements, express or implied, concerning the Company’s outlook and guidance for second quarter and fiscal year 2023 results, future operating results or margins, the ability to generate sales and income or cash flow, expected revenue mix, the Company’s business strategy and strategic initiatives, the Company’s repurchases of shares of its common stock, the Company’s expectations regarding restructuring charges and amortization of intangibles, and the Company’s intentions concerning the payment of dividends, among others, are forward-looking statements. Although the Company believes these statements are based on and derived from reasonable assumptions, they involve risks, uncertainties and assumptions that are beyond the Company’s ability to control or predict, relating to operations, markets and the business environment generally, including those discussed under Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, and in any of the Company’s subsequent reports filed with the Securities and Exchange Commission. Events relating to the possibility of customer demand fluctuations, supply chain constraints, continued inflationary pressures, the effects of foreign currency fluctuations and high interest rates, geopolitical uncertainties including trade restrictions, or the ability to utilize the Company’s manufacturing facilities at sufficient levels to cover its 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. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes, including the future results of the Company’s operations, may vary materially from those indicated. Undue reliance should not be placed on any forward-looking statements. Forward-looking statements are not guarantees of performance. All forward-looking statements included in this document are based upon information available to the Company as of the date of this document, and the Company assumes no obligation to update.

Non-GAAP Financial Measures

Management discloses non–GAAP information to provide investors with additional information to analyze the Company’s performance and underlying trends. A detailed reconciliation between GAAP results and results excluding certain items (“non-GAAP”) is included in the following tables attached to this document. In situations where a non-GAAP reconciliation has not been provided, the Company was unable to provide such a reconciliation without unreasonable effort due to the uncertainty and inherent difficulty predicting the occurrence, the financial impact and the periods in which the non-GAAP adjustments may be recognized. Management uses non–GAAP measures that exclude certain items in order to better assess operating performance and help investors compare results with our previous guidance. This document also references “free cash flow”, which the Company defines as cash flow from operations less additions to property, plant and equipment and purchased software. The Company’s non–GAAP information is not necessarily comparable to the non–GAAP information used by other companies. Non–GAAP information should not be viewed as a substitute for, or superior to, net income or other data prepared in accordance with GAAP as a measure of the Company’s profitability or liquidity. Readers should consider the types of events and transactions for which adjustments have been made.

 

Benchmark Electronics, Inc. and Subsidiaries

 

Condensed Consolidated Statements of Income

(Amounts in Thousands, Except Per Share Data)

(UNAUDITED)




Three Months Ended




March 31,




2023



2022


Sales


$

694,695



$

636,083


Cost of sales



630,737




578,481


Gross profit



63,958




57,602


Selling, general and administrative expenses



38,198




36,289


Amortization of intangible assets



1,592




1,609


Restructuring charges and other costs



1,426




4,297


Income from operations



22,742




15,407


Interest expense



(6,450)




(1,750)


Interest income



1,258




130


Other income (expense), net



(2,165)




(294)


Income before income taxes



15,385




13,493


Income tax expense



3,025




2,533


Net income


$

12,360



$

10,960


Earnings per share:







Basic


$

0.35



$

0.31


Diluted


$

0.35



$

0.31


Weighted-average number of shares used in calculating earnings per

share:







Basic



35,336




35,245


Diluted



35,592




35,470


 

Benchmark Electronics, Inc. and Subsidiaries

 

Condensed Consolidated Balance Sheets

(UNAUDITED)

(in thousands)




March 31,



December 31,




2023



2022


Assets







Current assets:







Cash and cash equivalents


$

210,893



$

207,430


Restricted cash



797





Accounts receivable, net



461,905




491,957


Contract assets



194,134




183,613


Inventories



778,137




727,749


Other current assets



45,006




41,400


Total current assets



1,690,872




1,652,149


Property, plant and equipment, net



221,016




211,478


Operating lease right-of-use assets



95,156




93,081


Goodwill and other, net



271,604




270,623


Total assets


$

2,278,648



$

2,227,331









Liabilities and Shareholders’ Equity







Current liabilities:







Current installments of long-term debt and finance lease obligations


$

3,456



$

4,275


Accounts payable



421,746




424,272


Advance payments from customers



185,808




197,937


Accrued liabilities



100,853




122,652


Total current liabilities



711,863




749,136


Long-term debt and finance lease obligations, less current installments



399,924




320,675


Operating lease liabilities



87,561




86,687


Other long-term liabilities



44,674




44,417


Shareholders’ equity



1,034,626




1,026,416


Total liabilities and shareholders’ equity


$

2,278,648



$

2,227,331


 

Benchmark Electronics, Inc. and Subsidiaries

 

Condensed Consolidated Statement of Cash Flows

(in thousands)

(UNAUDITED)




Three Months Ended




March 31,




2023



2022


Cash flows from operating activities:







Net income


$

12,360



$

10,960


Depreciation and amortization



11,100




10,897


Stock-based compensation expense



4,790




4,206


Accounts receivable, net



30,398




(26,356)


Contract assets



(10,521)




(13,431)


Inventories



(49,864)




(85,751)


Accounts payable



15,375




35,869


Advance payments from customers



(12,129)




34,002


Other changes in working capital and other, net



(26,415)




(38,421)


Net cash used in operations



(24,906)




(68,025)









Cash flows from investing activities:







Additions to property, plant and equipment and software



(38,731)




(17,975)


Other investing activities, net



19




1,330


Net cash used in investing activities



(38,712)




(16,645)









Cash flows from financing activities:







Share repurchases






(5,482)


Net debt activity



78,316




72,959


Other financing activities, net



(11,292)




(8,343)


Net cash provided by financing activities



67,024




59,134









Effect of exchange rate changes



854




(1,278)


Net increase (decrease) in cash and cash equivalents and restricted cash



4,260




(26,814)


Cash and cash equivalents and restricted cash at beginning of year



207,430




271,749


Cash and cash equivalents and restricted cash at end of period


$

211,690



$

244,935


 

Benchmark Electronics, Inc. and Subsidiaries

 

Reconciliation of GAAP to Non-GAAP Financial Results

(Amounts in Thousands, Except Per Share Data)

(UNAUDITED)




Three Months Ended




Mar 31,



Dec 31,



Mar 31,




2023



2022



2022


Income from operations (GAAP)


$

22,742



$

26,946



$

15,407


Amortization of intangible assets



1,592




1,592




1,609


Restructuring charges and other costs



1,426




799




2,314


Loss on the sale of property, plant and equipment









1,983


Settlement






3,250





Non-GAAP income from operations


$

25,760



$

32,587



$

21,313


GAAP operating margin



3.3

%



3.6

%



2.4

%

Non-GAAP operating margin



3.7

%



4.3

%



3.4

%











Gross Profit (GAAP)


$

63,958



$

72,127



$

57,602


Non-GAAP gross profit


$

63,958



$

72,127



$

57,602


GAAP gross margin



9.2

%



9.6

%



9.1

%

Non-GAAP gross margin



9.2

%



9.6

%



9.1

%











Selling, general and administrative expenses


$

38,198



$

39,540



$

36,289


Non-GAAP selling, general and administrative expenses


$

38,198



$

39,540



$

36,289












Net income (GAAP)


$

12,360



$

21,219



$

10,960


Amortization of intangible assets



1,592




1,592




1,609


Restructuring charges and other costs



1,426




799




2,314


Loss on the sale of property, plant and equipment









1,983


Settlement






(2,344)





Income tax adjustments(1)



(516)




(5)




(1,206)


Non-GAAP net income


$

14,862



$

21,261



$

15,660












Diluted earnings per share:










Diluted (GAAP)


$

0.35



$

0.60



$

0.31


Diluted (Non-GAAP)


$

0.42



$

0.60



$

0.44












Weighted-average number of shares used in calculating diluted earnings per share:










Diluted (GAAP)



35,592




35,630




35,470


Diluted (Non-GAAP)



35,592




35,630




35,470












Net cash used in operations


$

(24,906)



$

(52,749)



$

(68,025)


Additions to property, plant and equipment and software



(38,731)




(13,180)




(17,975)


Free cash flow (used)


$

(63,637)



$

(65,929)



$

(86,000)




 (1)  This amount represents the tax impact of the non-GAAP adjustments using the applicable effective tax rates.

 

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/benchmark-reports-first-quarter-2023-results-301815146.html

SOURCE Benchmark Electronics, Inc.

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