Plexus Corp. (NASDAQ: PLXS) today announced financial results for
our fiscal third quarter ended June 29, 2024, and guidance for
our fiscal fourth quarter ending September 28, 2024.
- Reports fiscal third quarter 2024
revenue of $961 million, GAAP operating margin of 4.1% and GAAP
diluted EPS of $0.91.
- Reports fiscal third quarter 2024
non-GAAP operating margin of 5.8% and non-GAAP diluted EPS of
$1.45, excluding $0.24 of stock-based compensation expense and
$0.30 of restructuring and other charges, net of tax.
- Initiates fiscal fourth quarter
2024 revenue guidance of $990 million to $1.03 billion with GAAP
diluted EPS of $1.14 to $1.29, including $0.36 of stock-based
compensation expense. Fiscal fourth quarter 2024 non-GAAP EPS
guidance of $1.50 to $1.65 excludes stock-based compensation
expense.
|
|
|
Three Months Ended |
|
Jun 29, 2024 |
|
Jun 29, 2024 |
|
Sep 28, 2024 |
|
Q3F24 Results |
|
Q3F24 Guidance |
|
Q4F24 Guidance |
Summary GAAP
Items |
|
|
|
|
|
Revenue (in
millions) |
$961 |
|
$960 to $1,000 |
|
$990 to $1,030 |
Operating
margin |
4.1% |
|
3.9% to 4.3% |
|
4.6% to 5.0% |
Diluted EPS |
$0.91 |
|
$0.80 to $0.95 |
|
$1.14 to $1.29 |
|
|
|
|
|
|
Summary
Non-GAAP Items (1) |
|
|
|
|
|
Adjusted operating
margin (2) |
5.8% |
|
5.2% to 5.6% |
|
5.6% to 6.0% |
Adjusted EPS
(3) |
$1.45 |
|
$1.22 to $1.37 |
|
$1.50 to $1.65 |
Return on invested
capital (ROIC) |
10.4% |
|
|
|
|
Economic
return |
2.2% |
|
|
|
|
(1) |
Refer to Non-GAAP Supplemental Information in Tables 1 and 2 for
additional information regarding non-GAAP financial measures. |
(2) |
Excludes stock-based compensation expense of approximately 70 bps
for Q3F24 results, 60 bps for Q3F24 guidance, and 100 bps for Q4F24
guidance. Excludes restructuring and other charges, net, of
approximately 100 bps for Q3F24 results and 70 bps for Q3F24
guidance. |
(3) |
Excludes stock-based compensation expense, net of tax, of $0.24 for
Q3F24 results, $0.21 for Q3F24 guidance and $0.36 for Q4F24
guidance. Excludes restructuring and other charges, net of tax, of
$0.30 for Q3F24 results and $0.21 for Q3F24 guidance. |
|
|
Fiscal Third
Quarter 2024
Information
- Won 35 manufacturing programs
during the quarter representing $279 million in annualized revenue
when fully ramped into production.
- Generated fiscal third quarter free
cash flow of $114 million, contributing to fiscal year-to-date free
cash flow of $147 million.
- Purchased $18.6 million of our
shares at an average price of $100.64 per share under our
repurchase program, leaving $19.5 million available under our
existing $50.0 million authorization.
Todd Kelsey, President and Chief Executive
Officer, commented, “Our team delivered superior operational
performance for the fiscal third quarter, which enabled outstanding
financial results. Revenue of $961 million was within our guidance
range, while non-GAAP operating margin and non-GAAP EPS of 5.8% and
$1.45, respectively, exceeded our guidance ranges. We generated
free cash flow of $114 million, representing the second best
quarterly performance in our history.”
Mr. Kelsey continued, “We delivered fiscal third
quarter new manufacturing program wins worth $279 million in
annualized revenue, including a record contribution within
Healthcare/Life Sciences. In addition, we are seeing increasing
market sector diversification in the demand for our engineering
solutions, resulting in the team achieving the highest level of new
business wins in the past four quarters.”
Patrick Jermain, Executive Vice President and
Chief Financial Officer, commented, “The $114 million of free cash
flow generated during the fiscal third quarter significantly
exceeded our expectations. Continued progress on our working
capital initiatives contributed to this strong performance,
resulting in fiscal third quarter cash cycle of 83 days, three days
favorable to our expectations and sequentially lower by eight days.
Given this performance, we now anticipate delivering in excess of
$150 million of free cash flow in fiscal 2024. The ongoing benefits
from our working capital initiatives combined with increasing
profitability is anticipated to result in continued strong free
cash flow generation in fiscal 2025. Finally, we reduced our
borrowing by $89 million and repurchased $18.6 million of our
shares during the fiscal third quarter. We expect to continue to
execute upon the remaining $19.5 million of our current repurchase
authorization during the fourth quarter of fiscal 2024, creating
additional shareholder value.”
Mr. Kelsey added, “We are witnessing signs of
strengthening demand across each of our market sectors, with share
gains and new program ramps further bolstering our ongoing and
continued expectations for revenue growth. As a result, we are
guiding fiscal fourth quarter revenue of $990 million to $1.03
billion, non-GAAP operating margin of 5.6% to 6.0% and non-GAAP EPS
of $1.50 to $1.65.”
Mr. Kelsey concluded, “Consistent with prior
expectations, we anticipate delivering a strong finish to our
fiscal 2024, with sequential expansion in revenue, robust operating
margin performance, sequential growth in EPS and continued free
cash flow generation. We expect sustained revenue growth momentum
into fiscal 2025, capitalizing upon Aerospace/Defense market sector
strength, increasing Healthcare/Life Sciences customer forecasts
aided by new program ramps, and improved semiconductor capital
equipment and broadband communications demand. We anticipate
revenue growth momentum, the benefits from optimizing our business
for greater efficiency during fiscal 2024 and ongoing free cash
flow deployment toward debt reduction and share repurchases will
create meaningful EPS growth in fiscal 2025.”
|
|
Quarterly
Comparison |
Three Months Ended |
(in thousands, except
EPS) |
Jun 29, 2024 |
|
Mar 30, 2024 |
|
Jul 1, 2023 |
Revenue |
$ |
960,751 |
|
|
$ |
966,900 |
|
|
$ |
1,021,610 |
|
Gross profit |
|
94,415 |
|
|
|
88,063 |
|
|
|
93,646 |
|
Operating income |
|
39,246 |
|
|
|
29,470 |
|
|
|
28,204 |
|
Net income |
|
25,140 |
|
|
|
16,239 |
|
|
|
15,799 |
|
Diluted EPS |
$ |
0.91 |
|
|
$ |
0.58 |
|
|
$ |
0.56 |
|
|
|
|
|
|
|
Gross margin |
|
9.8 |
% |
|
|
9.1 |
% |
|
|
9.2 |
% |
Operating margin |
|
4.1 |
% |
|
|
3.0 |
% |
|
|
2.8 |
% |
|
|
|
|
|
|
ROIC (1) |
|
10.4 |
% |
|
|
9.9 |
% |
|
|
13.5 |
% |
Economic return (1) |
|
2.2 |
% |
|
|
1.7 |
% |
|
|
4.5 |
% |
|
|
|
|
|
|
(1) Refer to Non-GAAP Supplemental Information in Tables 1 and 2
for non-GAAP financial measures discussed and/or disclosed in this
release, such as adjusted operating margin, adjusted net income,
adjusted diluted EPS, ROIC and economic return. |
|
Business Segment and Market Sector
Revenue
Plexus 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 Plexus’ market sector focused
strategy. Top 10 customers comprised 48% of revenue during both the
second and third quarter of fiscal 2024. This is down three
percentage points from the third quarter of fiscal 2023.
|
|
Business Segments ($
in millions) |
Three Months Ended |
|
Jun 29, 2024 |
|
Mar 30, 2024 |
|
Jul 1, 2023 |
Americas |
$ |
332 |
|
|
$ |
322 |
|
|
$ |
371 |
|
Asia-Pacific |
|
522 |
|
|
|
521 |
|
|
|
572 |
|
Europe, Middle East and
Africa |
|
137 |
|
|
|
155 |
|
|
|
105 |
|
Elimination of inter-segment
sales |
|
(30 |
) |
|
|
(31 |
) |
|
|
(26 |
) |
Total Revenue |
$ |
961 |
|
|
$ |
967 |
|
|
$ |
1,022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market Sectors ($ in
millions) |
Three Months Ended |
|
Jun 29, 2024 |
|
Mar 30, 2024 |
|
Jul 1, 2023 |
Healthcare/Life Sciences |
$ |
380 |
40 |
% |
|
$ |
379 |
39 |
% |
|
$ |
451 |
44 |
% |
Industrial |
|
403 |
42 |
% |
|
|
418 |
43 |
% |
|
|
428 |
42 |
% |
Aerospace/Defense |
|
178 |
18 |
% |
|
|
170 |
18 |
% |
|
|
143 |
14 |
% |
Total Revenue |
$ |
961 |
|
|
$ |
967 |
|
|
$ |
1,022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Supplemental
Information
Plexus provides non-GAAP supplemental
information, such as ROIC, economic return and free cash flow
because such measures are used for internal management goals and
decision-making, and because they provide management and investors
with additional insight into financial performance. In addition,
management uses these and other non-GAAP measures, such as adjusted
operating income, adjusted operating margin, adjusted net income
and adjusted diluted EPS, to provide a better understanding of core
performance for purposes of period-to-period comparisons. Plexus
believes that these measures are also useful to investors because
they provide further insight by eliminating the effect of
non-recurring items that are not reflective of continuing
operations. For additional information on non-GAAP measures, please
refer to the attached Non-GAAP Supplemental Information tables.
ROIC and Economic Return
ROIC for the third quarter of fiscal 2024 was
10.4%. Plexus defines ROIC as tax-effected annualized adjusted
operating income divided by average invested capital over a
four-quarter period for the third fiscal quarter. Invested capital
is defined as equity plus debt and operating lease obligations,
less cash and cash equivalents. Our weighted average cost of
capital for fiscal 2024 is 8.2%. ROIC for the third quarter of
fiscal 2024 less our weighted average cost of capital resulted in
an economic return of 2.2%.
Free Cash Flow
Plexus defines free cash flow as cash flows
provided by operations less capital expenditures. For the three
months ended June 29, 2024, cash flows provided by operations
were $131.6 million and capital expenditures were $17.4 million,
which resulted in free cash flow of $114.2 million.
|
|
Cash Cycle
Days |
Three Months Ended |
|
Jun 29, 2024 |
|
Mar 30, 2024 |
|
Jul 1, 2023 |
Days in Accounts
Receivable |
61 |
|
61 |
|
63 |
Days in Contract
Assets |
11 |
|
12 |
|
12 |
Days in
Inventory |
151 |
|
158 |
|
161 |
Days in Accounts
Payable |
(62) |
|
(65) |
|
(68) |
Days in Advanced
Payments (1) |
(78) |
|
(75) |
|
(78) |
Annualized Cash Cycle (2) |
83 |
|
91 |
|
90 |
|
|
|
|
|
|
(1) |
Includes a reclassification in the presentation of advanced
payments from customers reflected in prior period amounts. As of
July 1, 2023, the impact of this reclassification was an increase
in the Company's days in advanced payments and a reduction in
annualized cash cycle by 21 days. |
(2) |
Plexus calculates cash cycle as the sum of days in accounts
receivable, days in contract assets and days in inventory, less
days in accounts payable and days in advanced payments. |
|
|
Conference Call and Webcast Information
What: |
Plexus Fiscal 2024 Q3 Earnings Conference Call and Webcast |
When: |
Thursday, July 25, 2024 at 8:30 a.m. Eastern Time |
Where: |
Participants are encouraged to join the live webcast at the
investor relations section of the Plexus website,
plexus.com. Participants can also join utilizing the links
below:Audio conferencing
link:https://register.vevent.com/register/BI6d418e4593b04f1da475cd7614d2ed39Webcast
link:https://edge.media-server.com/mmc/p/vos8hpvo |
Replay: |
The webcast will be archived on the Plexus website and will be
available as on-demand for 12 months |
|
|
Investor and Media ContactShawn
Harrison+1.920.969.6325shawn.harrison@plexus.com
About PlexusSince 1979, Plexus
has been partnering with companies to create the products that
build a better world. We are a team of over 20,000 individuals who
are dedicated to providing Design and Development, Supply Chain
Solutions, New Product Introduction, Manufacturing and Sustaining
Services. Plexus is a global leader that specializes in serving
customers in industries with highly complex products and demanding
regulatory environments. Plexus delivers customer service
excellence to leading companies by providing innovative,
comprehensive solutions throughout a product’s lifecycle. For more
information about Plexus, visit our website at www.plexus.com.
Safe Harbor and Fair Disclosure
Statement The statements contained in this press release
that are guidance or which are not historical facts (such as
statements in the future tense and statements including believe,
expect, intend, plan, anticipate, goal, target and similar terms
and concepts), including all discussions of periods which are not
yet completed, are forward-looking statements that involve risks
and uncertainties. These risks and uncertainties include the
ability to realize anticipated savings from restructuring or
similar actions, as well as the adequacy of related charges as
compared to actual expenses; the effect of inflationary pressures
on our costs of production, profitability, and on the economic
outlook of our markets; the effects of shortages and delays in
obtaining components as a result of economic cycles, natural
disasters or otherwise; the risk of customer delays, changes,
cancellations or forecast inaccuracies in both ongoing and new
programs; the lack of visibility of future orders, particularly in
view of changing economic conditions; the economic performance of
the industries, sectors and customers we serve; the outcome of
litigation and regulatory investigations and proceedings, including
the results of any challenges with regard to such outcomes; the
effects of tariffs, trade disputes, trade agreements and other
trade protection measures; the effects of the volume of revenue
from certain sectors or programs on our margins in particular
periods; our ability to secure new customers, maintain our current
customer base and deliver product on a timely basis; the risks of
concentration of work for certain customers; the particular risks
relative to new or recent customers, programs or services, which
risks include customer and other delays, start-up costs, potential
inability to execute, the establishment of appropriate terms of
agreements, and the lack of a track record of order volume and
timing; the effects of start-up costs of new programs and
facilities or the costs associated with the closure or
consolidation of facilities; possible unexpected costs and
operating disruption in transitioning programs, including
transitions between Company facilities; the risk that new program
wins and/or customer demand may not result in the expected revenue
or profitability; the fact that customer orders may not lead to
long-term relationships; our ability to manage successfully and
execute a complex business model characterized by high product mix
and demanding quality, regulatory, and other requirements; the
risks associated with excess and obsolete inventory, including the
risk that inventory purchased on behalf of our customers may not be
consumed or otherwise paid for by the customer, resulting in an
inventory write-off; risks related to information technology
systems and data security; increasing regulatory and compliance
requirements; any tax law changes and related foreign jurisdiction
tax developments; current or potential future barriers to the
repatriation of funds that are currently held outside of the United
States as a result of actions taken by other countries or
otherwise; the potential effects of jurisdictional results on our
taxes, tax rates, and our ability to use deferred tax assets and
net operating losses; the weakness of areas of the global economy;
the effect of changes in the pricing and margins of products; raw
materials and component cost fluctuations; the potential effect of
fluctuations in the value of the currencies in which we transact
business; the effects of changes in economic conditions, political
conditions and tax matters in the United States and in the other
countries in which we do business; the potential effect of other
world or local events or other events outside our control (such as
the conflict between Russia and Ukraine, conflict in the Middle
East, escalating tensions between China and Taiwan or China and the
United States, changes in energy prices, terrorism, global health
epidemics and weather events); the impact of increased competition;
an inability to successfully manage human capital; changes in
financial accounting standards; and other risks detailed herein and
in our other Securities and Exchange Commission filings,
particularly in Risk Factors contained in our fiscal 2023 Form
10-K.
|
PLEXUS CORP. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(in thousands, except per share data) |
(unaudited) |
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
Jun 29, |
|
Jul 1, |
|
Jun 29, |
|
Jul 1, |
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net sales |
$ |
960,751 |
|
|
$ |
1,021,610 |
|
|
$ |
2,910,258 |
|
|
$ |
3,186,358 |
|
Cost of sales |
|
866,336 |
|
|
|
927,964 |
|
|
|
2,639,640 |
|
|
|
2,888,520 |
|
Gross profit |
|
94,415 |
|
|
|
93,646 |
|
|
|
270,618 |
|
|
|
297,838 |
|
Operating expenses: |
|
|
|
|
|
|
|
Selling and administrative expenses |
|
45,950 |
|
|
|
42,348 |
|
|
|
136,487 |
|
|
|
132,257 |
|
Restructuring and other charges, net |
|
9,219 |
|
|
|
23,094 |
|
|
|
20,257 |
|
|
|
23,094 |
|
Operating income |
|
39,246 |
|
|
|
28,204 |
|
|
|
113,874 |
|
|
|
142,487 |
|
Other income (expense): |
|
|
|
|
|
|
|
Interest expense |
|
(7,389 |
) |
|
|
(8,231 |
) |
|
|
(23,299 |
) |
|
|
(23,412 |
) |
Interest income |
|
1,015 |
|
|
|
598 |
|
|
|
2,640 |
|
|
|
2,291 |
|
Miscellaneous, net |
|
(2,568 |
) |
|
|
(3,194 |
) |
|
|
(9,097 |
) |
|
|
(6,750 |
) |
Income before income taxes |
|
30,304 |
|
|
|
17,377 |
|
|
|
84,118 |
|
|
|
114,616 |
|
Income tax expense |
|
5,164 |
|
|
|
1,578 |
|
|
|
13,524 |
|
|
|
15,783 |
|
Net income |
$ |
25,140 |
|
|
$ |
15,799 |
|
|
$ |
70,594 |
|
|
$ |
98,833 |
|
Earnings per share: |
|
|
|
|
|
|
|
Basic |
$ |
0.92 |
|
|
$ |
0.57 |
|
|
$ |
2.57 |
|
|
$ |
3.58 |
|
Diluted |
$ |
0.91 |
|
|
$ |
0.56 |
|
|
$ |
2.53 |
|
|
$ |
3.51 |
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
Basic |
|
27,364 |
|
|
|
27,561 |
|
|
|
27,463 |
|
|
|
27,619 |
|
Diluted |
|
27,765 |
|
|
|
27,992 |
|
|
|
27,918 |
|
|
|
28,169 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PLEXUS CORP. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(in thousands, except per share data) |
(unaudited) |
|
Jun 29, |
|
Sep 30, |
|
|
2024 |
|
|
|
2023 |
|
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
269,868 |
|
|
$ |
256,233 |
|
Restricted cash |
|
22 |
|
|
|
421 |
|
Accounts receivable |
|
643,786 |
|
|
|
661,542 |
|
Contract assets |
|
115,982 |
|
|
|
142,297 |
|
Inventories |
|
1,434,297 |
|
|
|
1,562,037 |
|
Prepaid expenses and other |
|
76,895 |
|
|
|
49,693 |
|
Total current assets |
|
2,540,850 |
|
|
|
2,672,223 |
|
Property, plant and equipment,
net |
|
489,856 |
|
|
|
492,036 |
|
Operating lease right-of-use
assets |
|
58,867 |
|
|
|
69,363 |
|
Deferred income taxes |
|
55,119 |
|
|
|
62,590 |
|
Other assets |
|
26,183 |
|
|
|
24,960 |
|
Total non-current assets |
|
630,025 |
|
|
|
648,949 |
|
Total assets |
$ |
3,170,875 |
|
|
$ |
3,321,172 |
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
Current liabilities: |
|
|
|
Current portion of long-term debt and finance lease
obligations |
$ |
258,175 |
|
|
$ |
240,205 |
|
Accounts payable |
|
592,644 |
|
|
|
646,610 |
|
Advanced payments from customers |
|
736,206 |
|
|
|
760,351 |
|
Accrued salaries and wages |
|
74,602 |
|
|
|
94,099 |
|
Other accrued liabilities |
|
63,080 |
|
|
|
71,402 |
|
Total current liabilities |
|
1,724,707 |
|
|
|
1,812,667 |
|
Long-term debt and finance
lease obligations, net of current portion |
|
90,715 |
|
|
|
190,853 |
|
Accrued income taxes payable |
|
17,198 |
|
|
|
31,382 |
|
Long-term operating lease liabilities |
|
31,923 |
|
|
|
38,552 |
|
Deferred income taxes |
|
4,293 |
|
|
|
4,350 |
|
Other liabilities |
|
35,679 |
|
|
|
28,986 |
|
Total non-current liabilities |
|
179,808 |
|
|
|
294,123 |
|
Total liabilities |
|
1,904,515 |
|
|
|
2,106,790 |
|
Shareholders’ equity: |
|
|
|
Common stock |
|
545 |
|
|
|
543 |
|
Additional paid-in-capital |
|
670,199 |
|
|
|
661,270 |
|
Common stock held in treasury |
|
(1,170,574 |
) |
|
|
(1,134,429 |
) |
Retained earnings |
|
1,781,922 |
|
|
|
1,711,328 |
|
Accumulated other comprehensive loss |
|
(15,732 |
) |
|
|
(24,330 |
) |
Total shareholders’ equity |
|
1,266,360 |
|
|
|
1,214,382 |
|
Total liabilities and shareholders’ equity |
$ |
3,170,875 |
|
|
$ |
3,321,172 |
|
|
|
|
|
|
|
PLEXUS CORP. AND SUBSIDIARIES |
NON-GAAP SUPPLEMENTAL INFORMATION Table 1 |
(in thousands, except per share data) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
Jun 29, |
|
Mar 30, |
|
Jul 1, |
|
Jun 29, |
|
Jul 1, |
|
|
2024 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Operating income,
as reported |
$ |
39,246 |
|
|
$ |
29,470 |
|
|
$ |
28,204 |
|
|
$ |
113,874 |
|
|
$ |
142,487 |
|
Operating margin,
as reported |
|
4.1 |
% |
|
|
3.0 |
% |
|
|
2.8 |
% |
|
|
3.9 |
% |
|
|
4.5 |
% |
|
|
|
|
|
|
|
|
|
|
Non-GAAP
adjustments: |
|
|
|
|
|
|
|
|
|
Restructuring costs (1) |
|
9,219 |
|
|
|
13,288 |
|
|
|
8,865 |
|
|
|
22,507 |
|
|
|
8,865 |
|
Other non-recurring (income) charges (2) |
|
— |
|
|
|
(2,250 |
) |
|
|
14,229 |
|
|
|
(2,250 |
) |
|
|
14,229 |
|
Stock-based compensation (3) |
|
7,205 |
|
|
|
7,096 |
|
|
|
3,829 |
|
|
|
19,636 |
|
|
|
15,555 |
|
Non-GAAP operating
income |
$ |
55,670 |
|
|
$ |
47,604 |
|
|
$ |
55,127 |
|
|
$ |
153,767 |
|
|
$ |
181,136 |
|
Non-GAAP operating
margin |
|
5.8 |
% |
|
|
4.9 |
% |
|
|
5.4 |
% |
|
|
5.3 |
% |
|
|
5.7 |
% |
|
|
|
|
|
|
|
|
|
|
Net income, as
reported |
$ |
25,140 |
|
|
$ |
16,239 |
|
|
$ |
15,799 |
|
|
$ |
70,594 |
|
|
$ |
98,833 |
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
adjustments: |
|
|
|
|
|
|
|
|
|
Restructuring costs, net of tax (1) |
|
8,251 |
|
|
|
11,893 |
|
|
|
7,920 |
|
|
|
20,144 |
|
|
|
7,920 |
|
Other non-recurring charges, net of tax (2) |
|
— |
|
|
|
(2,014 |
) |
|
|
13,346 |
|
|
|
(2,014 |
) |
|
|
13,346 |
|
Stock-based compensation, net of tax (3) |
|
6,845 |
|
|
|
7,096 |
|
|
|
3,829 |
|
|
|
19,276 |
|
|
|
15,555 |
|
Adjusted net
income |
$ |
40,236 |
|
|
$ |
33,214 |
|
|
$ |
40,894 |
|
|
$ |
108,000 |
|
|
$ |
135,654 |
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per share, as reported |
$ |
0.91 |
|
|
$ |
0.58 |
|
|
$ |
0.56 |
|
|
$ |
2.53 |
|
|
$ |
3.51 |
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP per share
adjustments: |
|
|
|
|
|
|
|
|
|
Restructuring costs, net of tax (1) |
|
0.30 |
|
|
|
0.43 |
|
|
|
0.28 |
|
|
|
0.72 |
|
|
|
0.28 |
|
Other non-recurring charges, net of tax (2) |
|
— |
|
|
|
(0.07 |
) |
|
|
0.48 |
|
|
|
(0.07 |
) |
|
|
0.47 |
|
Stock-based compensation, net of tax (3) |
|
0.24 |
|
|
|
0.25 |
|
|
|
0.14 |
|
|
|
0.69 |
|
|
|
0.56 |
|
Adjusted diluted
earnings per share |
$ |
1.45 |
|
|
$ |
1.19 |
|
|
$ |
1.46 |
|
|
$ |
3.87 |
|
|
$ |
4.82 |
|
|
|
|
|
|
|
|
|
|
|
(1) |
During the three months ended June 29, 2024, restructuring and
impairment charges of $9.2 million, or $8.3 million net of taxes,
were incurred for employee severance costs associated with a
reduction in the Company's workforce as well as closure costs
associated with a site in the Company's AMER region.During the
three months ended March 30, 2024, restructuring and impairment
charges of $13.3 million, or $11.9 million, net of taxes, were
incurred from employee severance costs associated with a reduction
in the Company's workforce as well as closure costs associated with
a site in the Company's EMEA region.During the nine months ended
June 29, 2024, costs comprising of the two restructuring events
described above totaled $22.5 million, or $20.1 million, net of
taxes.During the three and nine months ended July 1, 2023,
restructuring costs of $8.9 million, or $7.9 million net of taxes,
were incurred for employee severance costs associated with a
reduction in the Company's workforce as well as a lease agreement
termination. |
(2) |
During the three months ended March 30, 2024 and included in the
nine months ended June 29, 2024, insurance proceeds of $2.3
million, or $2.0 million net of taxes, were received related to an
arbitration decision associated with a contractual matter that
occurred in the Company's EMEA region in fiscal 2023.During the
three and nine months ended July 1, 2023, a one-time, non-recurring
charge of $14.2 million, or $13.3 million net of taxes, was
incurred for an arbitration decision regarding a contractual matter
in the Company's EMEA region. |
(3) |
During the three and nine months ended June 29, 2024, $0.9 million,
or $0.8 million net of taxes ($0.03 per diluted share), of
accelerated stock-based compensation expense was recorded in
selling and administrative expenses in the accompanying Condensed
Consolidated Statements of Operations as a result of a previously
announced executive retirement agreement. |
|
|
|
PLEXUS CORP. AND SUBSIDIARIES |
NON-GAAP SUPPLEMENTAL INFORMATION Table 2 |
(in thousands) |
(unaudited) |
|
|
|
|
|
|
ROIC and Economic Return
Calculations |
Nine Months Ended |
|
Six Months Ended |
|
Nine Months Ended |
|
Jun 29, |
|
Mar 30, |
|
Jul 1, |
|
2024 |
|
|
2024 |
|
|
2023 |
|
Operating income, as reported |
|
$ |
113,874 |
|
|
|
$ |
74,628 |
|
|
|
$ |
142,487 |
|
Restructuring and other charges, net |
|
|
20,257 |
|
|
|
|
11,038 |
|
|
|
|
23,094 |
|
Accelerated stock-based compensation (1) |
+ |
|
892 |
|
|
+ |
|
— |
|
|
+ |
|
— |
|
Adjusted operating income |
|
$ |
135,023 |
|
|
|
$ |
85,666 |
|
|
|
$ |
165,581 |
|
|
÷ |
|
3 |
|
|
x |
|
2 |
|
|
÷ |
|
3 |
|
|
|
$ |
45,008 |
|
|
|
|
|
|
$ |
55,194 |
|
|
x |
|
4 |
|
|
|
|
|
x |
|
4 |
|
Adjusted annualized operating
income |
|
$ |
180,032 |
|
|
|
$ |
171,332 |
|
|
|
$ |
220,776 |
|
Adjusted effective tax
rate |
x |
|
16 |
% |
|
x |
|
15 |
% |
|
x |
|
13 |
% |
Tax impact |
|
|
28,805 |
|
|
|
|
25,700 |
|
|
|
|
28,701 |
|
Adjusted operating income
(tax-effected) |
|
$ |
151,227 |
|
|
|
$ |
145,632 |
|
|
|
$ |
192,075 |
|
|
|
|
|
|
|
|
|
|
Average invested capital |
÷ |
$ |
1,454,871 |
|
|
÷ |
$ |
1,478,062 |
|
|
÷ |
$ |
1,423,003 |
|
ROIC |
|
|
10.4 |
% |
|
|
|
9.9 |
% |
|
|
|
13.5 |
% |
Weighted average cost of
capital |
- |
|
8.2 |
% |
|
- |
|
8.2 |
% |
|
- |
|
9.0 |
% |
Economic return |
|
|
2.2 |
% |
|
|
|
1.7 |
% |
|
|
|
4.5 |
% |
Average Invested Capital
Calculations |
Jun 29, |
|
Mar 30, |
|
Dec 30, |
|
Sep 30, |
|
|
2024 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2023 |
|
Equity |
$ |
1,266,360 |
|
|
$ |
1,259,762 |
|
|
$ |
1,266,755 |
|
|
$ |
1,214,382 |
|
Plus: |
|
|
|
|
|
|
|
Debt and finance lease obligations - current |
|
258,175 |
|
|
|
245,964 |
|
|
|
251,119 |
|
|
|
240,205 |
|
Operating lease obligations - current (2) |
|
7,990 |
|
|
|
8,281 |
|
|
|
9,172 |
|
|
|
8,363 |
|
Debt and finance lease obligations - long-term |
|
90,715 |
|
|
|
192,025 |
|
|
|
192,118 |
|
|
|
190,853 |
|
Operating lease obligations - long-term |
|
31,923 |
|
|
|
33,915 |
|
|
|
35,989 |
|
|
|
38,552 |
|
Less: Cash and cash
equivalents |
|
(269,868 |
) |
|
|
(265,053 |
) |
|
|
(231,982 |
) |
|
|
(256,233 |
) |
|
$ |
1,385,295 |
|
|
$ |
1,474,894 |
|
|
$ |
1,523,171 |
|
|
$ |
1,436,122 |
|
Average Invested Capital
Calculations |
Jul 1, |
|
Apr 1, |
|
Dec 31, |
|
Oct 1, |
|
|
2023 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2022 |
|
Equity |
$ |
1,184,362 |
|
|
$ |
1,182,382 |
|
|
$ |
1,150,259 |
|
|
$ |
1,095,731 |
|
Plus: |
|
|
|
|
|
|
|
Debt and finance lease obligations - current |
|
304,781 |
|
|
|
294,011 |
|
|
|
329,076 |
|
|
|
273,971 |
|
Operating lease obligations - current (2) |
|
8,772 |
|
|
|
8,358 |
|
|
|
8,878 |
|
|
|
7,948 |
|
Debt and finance lease obligations - long-term |
|
187,468 |
|
|
|
188,730 |
|
|
|
187,272 |
|
|
|
187,776 |
|
Operating lease obligations - long-term |
|
40,515 |
|
|
|
31,257 |
|
|
|
32,149 |
|
|
|
33,628 |
|
Less: Cash and cash
equivalents |
|
(252,965 |
) |
|
|
(269,664 |
) |
|
|
(247,880 |
) |
|
|
(274,805 |
) |
|
$ |
1,472,933 |
|
|
$ |
1,435,074 |
|
|
$ |
1,459,754 |
|
|
$ |
1,324,249 |
|
(1) |
During the three and nine months ended June 29, 2024, $0.9 million
of accelerated stock-based compensation expense was recorded in
selling and administrative expenses in the accompanying Condensed
Consolidated Statements of Operations as a result of a previously
announced executive retirement agreement. |
(2) |
Included in other accrued liabilities on the Condensed Consolidated
Balance Sheets. |
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