Sanmina Reports Third Quarter Fiscal 2014 Results

SAN JOSE, Calif., July 21, 2014 — (PRNewswire) — Sanmina Corporation ("Sanmina" or the "Company") (NASDAQ GS: SANM), a leading integrated manufacturing solutions company, today reported financial results for the third fiscal quarter ended June 28, 2014.

Third Quarter Fiscal 2014 Summary

  • Revenue of $1.60 billion
  • GAAP operating margin of 3.3 percent
  • GAAP diluted earnings per share of $0.24
  • Non-GAAP(1) operating margin of 3.8 percent
  • Non-GAAP(1) diluted earnings per share of $0.53

Revenue for the third quarter was $1.60 billion, compared to $1.48 billion in the prior quarter and $1.49 billion for the same period of fiscal 2013.

GAAP operating income in the third quarter was $53.3 million or 3.3 percent of revenue, compared to $35.7 million or 2.4 percent of revenue for the same period ended June 29, 2013. GAAP net income in the third quarter was $20.7 million, compared to $18.7 million for the same period a year ago. GAAP diluted earnings per share for the quarter were $0.24, compared to $0.22 in the third quarter of fiscal 2013.

Non-GAAP operating income in the third quarter was $60.9 million or 3.8 percent of revenue, compared to $49.7 million or 3.3 percent of revenue in the third quarter fiscal 2013. Non-GAAP net income in the third quarter was $45.3 million, compared to $34.0 million in the same period a year ago. Non-GAAP diluted earnings per share were $0.53, compared to $0.40 for the same period a year ago.

"We delivered a solid third quarter. Revenue was up 9 percent sequentially and 8 percent year over year. Each of our end-market segments grew on a sequential basis, with notable performance from our industrial, medical and defense segment," stated Jure Sola, Chairman and Chief Executive Officer of Sanmina Corporation. "Our investments in leading technology and capabilities offer differentiation in the market and value for our customers. We continue to benefit from new programs and stable demand with key customers. Our previous expectation of modest growth in fiscal 2014 is achievable and solid execution of our strategy supports a promising future," added Sola.

Balance Sheet Summary

  • Ending cash and cash equivalents were $552.0 million
  • Cash flow from operations was $151.7 million
  • Issued $375.0 million of 4.375% Senior Secured Notes due 2019
  • Redeemed $264.4 million of 7% Senior Notes due 2019
  • Repurchased .3 million common shares for a total of $6.0 million
  • Inventory turns were 7.0x
  • Cash cycle days were 44.1 days

Company Completes Partial Redemption of 7% Senior Notes Due 2019
On July 7, 2014 the Company completed the redemption of an additional $135.6 million in aggregate principal amount of its Senior Notes due in 2019 (the "Notes") using existing cash. As a result, a total of $100 million of Notes remain outstanding.

Fourth Quarter Fiscal 2014 Outlook
The following forecast is for the fourth fiscal quarter ending September 27, 2014. These statements are forward-looking and actual results may differ materially.

  • Revenue between $1.60 billion to $1.65 billion
  • Non-GAAP diluted earnings per share between $0.50 to $0.55

Company Conference Call Information
Sanmina will hold a conference call regarding results for the third quarter of fiscal 2014 on Monday, July 21, 2014 at 5:00 p.m. ET (2:00 p.m. PT). The access numbers are: domestic 877-273-6760 and international 706-634-6605. The conference will also be broadcast live over the Internet. You can log on to the live webcast at Additional information in the form of a slide presentation is available by logging onto Sanmina's website at A replay of the conference call will be available for 48-hours. The access numbers are: domestic 855-859-2056 and international 404-537-3406, access code is 72826219.

(1)In the commentary set forth above and/or in the financial statements included in this earnings release, we present the following non-GAAP financial measures: operating income, operating margin, net income and diluted earnings per share. In computing each of these non-GAAP financial measures, we exclude charges or gains relating to: stock-based compensation expenses, restructuring costs (including employee severance and benefits costs and charges related to excess facilities and assets), acquisition and integration costs (consisting of costs associated with the acquisition and integration of acquired businesses into our operations), impairment charges for goodwill and other assets, amortization expense and other infrequent or unusual items (including charges associated with distressed customers, litigation settlements, gains and losses on sales of assets and redemptions of debt, discrete tax events and deferred tax changes), to the extent material or which we consider to be of a non-operational nature in the applicable period. See Schedule 1 below for more information regarding our use of non-GAAP financial measures, including the economic substance behind each exclusion, the manner in which management uses non-GAAP measures to conduct and evaluate the business, the material limitations associated with using such measures and the manner in which management compensates for such limitations. A reconciliation of the non-GAAP results contained in this release to their most directly comparable GAAP measures is included in the financial statements contained in this release. Sanmina provides its fourth quarter fiscal 2014 outlook only on a non-GAAP basis due to the inherent uncertainties associated with forecasting the timing and amount of acquisitions, restructuring activities, asset impairments and other unusual and infrequent items.

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