News
For the three months ended Oct. 2, the company posted earnings of $11.5 million, up from a loss of $85.7 million last year. The results topped consensus forecasts, thanks to strength in PCs and wireless infrastructure.
Excluding items, income rose to $41.8 million, from $14 million last year. Gross margins were 5.3%. In a research note, Deutsche Bank said, "We believe a mix shift toward PCs, continued pricing pressure and management mishaps in enclosures combined to drive the margin shortfall."
The company generated $160 million in cash flow from operations during the quarter. Inventory turns improved to 11.5 from 10.4 sequentially.
For its 2004 fiscal year, Sanmina-SCI posted a loss of $5.3 million, up from a loss of $137.2 million in 2003. Excluding one-time charges, the company reported income of $128.9 million, up from $28.3 million last year. Yearly revenue rose to $12.2 billion, from $10.4 billion.
Sanmina guided for first-quarter earnings per share of 9 to 11 cents
on revenue of $3.3 billion to $3.5 billion. Last year Sanmina-SCI
reported revenue of $3 billion.
So says the latest NAM/Fortune Manufacturing Index, a quarterly poll of 336 members of the National Association of Manufacturers.
NAM said the bullish outlook is based on continued strong sales expectations. "Fully three quarters of survey respondents indicated that they expect their sales to increase over the coming four quarters," said NAM president John Engler, in a statement.
Although the data show a modest sequential decline, when 90% of large and 87% of small companies were positive, the improvement is dramatic when compared to the period of Q3 2000 to Q2 2003, when less than two-thirds of NAM members were optimistic.
"This report confirms our belief that the economy is gaining strength and will continue to expand throughout this year and next," Engler said. "This is equal to the average of the prior two quarters and 10% above the response given a year ago."
Large firms expect sales to rise 6.1%, the strongest response since the fourth quarter of 1997, when the poll was begun. Smaller companies expect sales to grow by 4.4% over the coming year.
Fifty-five percent of respondents expect to increase capital spending over the coming year. Large and small firms expect to increase employment in the coming year.
The net loss included a $36.8 million valuation allowance for deferred tax assets, and $3.8 million in restructuring and impairment costs. The company cited higher-than-expected startup costs for its facility in Penang, Malaysia, and the closing of its Bothell, WA, plant.
The company guided for revenue growth of 15 to 18% in fiscal 2005.
For the year Plexus reported a net loss of $31.6 million on revenues of $1.04 billion. The company reported pro-forma net income of $13.5 million, excluding one-time items.
In 2003, Plexus had sales of $807.8 million and a net loss of $68 million.
"As we look to fiscal 2005 our primary objective remains to increase profitability," said president and CEO Dean Foate, in a press statement. "We expect to achieve this goal with improvements in capacity utilization and operating efficiencies through a combination of moderate revenue expansion and lean manufacturing and inventory management initiatives."
"For first fiscal quarter, we are initiating revenue guidance of $280 million to $290 million," Foate said.
Gordon Bitter, Chief Financial Officer, added, "Despite higher .
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