ANGLETON, TX -- Benchmark Electronics today announced second quarter net income fell 38% on a 13% drop in sales.

For the three months ended June 30, the EMS posted revenues of $579 million, down from $664 million a year ago. Net income plunged to $13 million from $21 million in the year ago quarter. Both results were improved over the company's first quarter, however.

Operating margin was 3.1%, down 80 basis points from last year. Cash flows from operating activities were $81 million during the quarter and $158 million through the first half. The firm has $573 million in cash on hand, $535 million outside the US.

In a statement announcing the results, Benchmark president and CEO Gayla Delly pointed to improvements among the company's higher-value accounts.

"Our year-over-year revenue from higher-value markets increased from 53% to 63% for the first half of the year driven by the successful transformation of our customer portfolio and the Secure (Communications) acquisition."

Higher-value markets refer to industrial, $214 million in the quarter), medical ($92 million), and test and instrumentation ($60 million). Through acquisitions, Benchmark has been trying to reduce its longtime dependence on the lower-margin computing sector.

Delly also noted improvements among other financial metrics during the period.

"We are encouraged by the progress of our initiatives to improve our cash conversion cycle from 99 to 83 days. We have transitioned a number of new programs to more efficient supply chain solutions over the last 18 months, primarily in our international locations and are on track to achieve 75 days as we exit the fourth quarter."

Register now for PCB West, the Silicon Valley's largest trade show for the printed circuit industry, taking place Sept. 13-15 in Santa Clara: pcbwest.com

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