SAN JOSE, July 20 - Sanmina-SCI showed a third-quarter profit as revenues jumped nearly 16% from the year-ago quarter, but the company will take a $100 million restructuring charge as it reduces capacity in North America and Europe.

For the third quarter ended June 26, Sanmina-SCI reported revenues of $3.07 billion, up 7.2% sequentially and 15.9% over last year. Operating income was $68.8 million, an increase of 21.1% over the prior quarter and up 72% from last year.

Sanmina will incur a restructuring charge of up to approximately $100 million as it shifts capacity from North America and Western Europe to Eastern Europe, Latin America and Asia.

"Our Eastern European, Latin American and Asian operations are operating more efficiently than previously forecast," said Jure Sola, Sanmina's chairman and CEO, in a statement. "As a result, we plan to realign our manufacturing operations in high-cost locations, and leverage our expanding capacity and technical capabilities in more cost-efficient regions such as Eastern Europe, Latin America and Asia."  However, Sanmina's PCB capacity utilization rates are reportedly somewhat lower than other major firms. Merix, for example, recently reported capacity utilization rates of over 90%.

By restructuring, Sanmina-SCI expects to save $22 million to $24 million per quarter, president and COO Randy Furr said Tuesday on a conference call with analysts. The company did not say which plants were targeted for closure.

Earlier in the quarter, Sanmina-SCI announced the pending purchase of Pentex-Schweizer, a Singapore-based PCB company.

For the quarter, cash cycle days improved to 31 days and inventory turns rose from 9.3 in Q2 to 10.4. At quarter's end, Sanmina reported $1 billion in cash and short-term investments, working capital of $2.2 billion and stockholders' equity of $3.3 billion.

"Our results this quarter are primarily due to growth in key customer end-markets and increased demand for our high-end EMS product programs," said Sola.

Sanmina-SCI reaffirmed its guidance for fourth-quarter revenue to be in the range of $3.1 billion to $3.3 billion.

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