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June Swoon: Benchmark’s Sales Drop 9.8% |
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Written by Mike Buetow
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Thursday, 24 July 2008 |
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ANGLETON, TX – Benchmark Electronics reported second-quarter
sales of $682 million, down 9.8% year-over-year. Net income was down 15.4% to
$22 million for the period ended June 30.
Revenues
were well below Wall Street estimates of $727 million.
The company recorded income of $29 million excluding
restructuring charges, integration costs, amortization of intangibles and
stock-based compensation costs.
Benchmark
officials guided for revenues of $650 million to $690 million for the third
quarter.
Cash from
operations was $2 million for the quarter, suggesting that free cash flow was
roughly a loss of $10 million, said Sherri Scribner of Deutsche Bank Equity
Research. GAAP operating margin for the second quarter was 3.4%. Days
sales outstanding were 62 days. Inventory turns were 6.5 times.
The company blamed slower ramp of new products and more
rapidly declining mature programs. Also said soft macro environment is hurting
them. Chief executive Cary T. Fu said, "Operationally our execution was
solid during the second quarter, although revenues were impacted by maturing
programs declining at a more rapid pace than our new programs ramped, and by
the impact of a soft macro environment. We believe this is a near-term challenge
and that we are well positioned for growth, given the number of new programs
that we have won."
Benchmark
said it would increase its share buyback by $100 million following completion
of a prior $125 million buyback in mid-July.
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