ANGLETON, TX, Oct. 21 -- Benchmark Electronics saw third-quarter profits rise 40% as sales jumped by $50 million.

The EMS maker said September quarter earnings were $18 million, up from $12.9 million last year, a new third-quarter high. Revenue was $505 million, up from $455 million.

Analysts forecast sales of $496 million for the quarter.

Operating margins rose to 4.8% and inventories were up $13 million, to $290 million, the company said.

Benchmark guided for fourth-quarter sales of $505 million to $530 million.

Celestica Reports GAAP Loss on $2.2b in Revenue
10-21-2004

by Mike Buetow

TORONTO, Oct. 21 -- Celestica Inc. today said September quarter revenue was $2.2 billion, up 33% from last year and in line with previous guidance, despite lower telecom demand.

The EMS maker reported a GAAP net loss of $22.3 million, includes pretax restructuring charges of $47.7 million, including $16.6 million for inventory writedowns and a $12 million gain associated with the sale of the Power Systems business.

Last year Celestica reported a GAAP net loss of $65 million, including restructuring and other charges of $49.1 million.

"Despite lower demand this quarter from some of our largest communications and IT customers, we continued to expand margins, reduce SG&A spending, improve customer diversity, act on unprofitable or non-core activities and generate healthy cash flow from operations," said chief executive Steve Delaney, in a press statement.

Delaney called end-market demand "less stable" than earlier in the year. The company anticipates December quarter revenue in the range of $2.1 billion to $2.3 billion, with a softening in end-market demand balancing normal seasonality.

In a research note, Deutsche Bank said  it remains cautious on the sector, including Celestica, due to slowing demand and aggressive pricing. "Celestica`s fourth quarter guidance speaks volumes to the anemic end-market environment (flat quarter-on-quarter in the [usuallyl] seasonally strong fourth quarter," the firm said. 

Year-to-date Celestica's revenue has risen 35% to $6.51 billion and the GAAP net loss is $56.2.

Celestica said it has ceased creating its own reference designs and will exit its channel distribution activities for these products. Said Delaney: "We remain committed to providing enterprise-wide server solutions to our customers, including product design services, manufacturing, logistics services, and after-market services".