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Plexus has released its financial results for its fiscal second quarter ended March 30, 2019, and guidance for its fiscal third quarter ending June 29, 2019.
Fiscal Second Quarter 2019 Highlights:
- Won 36 manufacturing programs during the quarter representing $247 million in annualized revenue when fully ramped into production
- Trailing four quarter manufacturing wins total $912 million in annualized revenue when fully ramped into production
- Purchased $56.2 million of our shares at an average price of $56.72 per share under our existing share repurchase program
“In the fiscal second quarter, we continued to deliver meaningful growth with record quarterly revenue of $789 million, a 13% increase over the comparable quarter last year. Sizable customer mix changes that occurred within the quarter created cost inefficiencies, resulting in operating margin and EPS slightly below our guidance ranges,” said Todd Kelsey, president and CEO.
“During the fiscal second quarter, we continued our cash repatriation strategy by repatriating approximately $28 million of offshore cash. We repurchased approximately $56 million of our shares, which was partially funded with repatriated cash. Since the enactment of U.S. tax reform last year, we have brought back close to $480 million,” said Patrick Jermain, executive vice president and CFO.
“Although working capital requirements were greater than anticipated during the fiscal second quarter, we are reconfirming our full fiscal year expectation for free cash flow in the range of $40 to $60 million,” Jermain added.
“As we look to the fiscal third quarter, we expect weakness in our Communications sector to offset anticipated growth in our Aerospace/Defense and Healthcare/Life Sciences sectors. As a result, we are guiding relatively flat revenue in the range of $760 to $800 million. At this revenue level, we anticipate GAAP EPS in the range of $0.76 to $0.86, with operating margins modestly below our target range. Further, we are implementing productivity and cost containment actions that, in conjunction with our current revenue expectations, are designed to support a return to our target operating margin range in the fiscal fourth quarter,” Kelsey continued.
“We remain confident in our revenue outlook and maintain our expectation of solid growth in fiscal 2019. Demand remains robust in many of our end markets, and our teams continue to achieve strong wins performance throughout our differentiated portfolio, producing $247 million of new manufacturing wins in the fiscal second quarter. While we continue to deliver the highest operating margin among our peers, we are committed to taking the necessary actions to consistently deliver our target range of 4.7% to 5.0%,” Kelsey concluded.
Business Segment and Market Sector Revenue
The Company measures operational performance and allocates resources on a geographic segment basis. Plexus also reports revenue based on the market sector breakout set forth in the table below, which reflects the Company’s global market sector focused business development strategy. Top 10 customers comprised 56% of revenue during the fiscal second quarter, down three percentage points from the fiscal first quarter of 2019.
About Plexus – The Product Realization Company
Since 1979, Plexus has been partnering with companies to create the products that build a better world. We are a team of over 19,000 individuals who are dedicated to providing global Design and Development, Supply Chain Solutions, New Product Introduction, Manufacturing, and Aftermarket Services. Plexus is a global leader that specializes in serving customers in industries with highly complex products and demanding regulatory requirements. Plexus delivers customer service excellence to leading global companies by providing innovative, comprehensive solutions throughout the product’s lifecycle.