Exhibit 99
[SANMINA-SCI LOGO]
PRESS RELEASE
CONTACTS:
Mark Lustig
Senior Vice President of Finance and
Acting Chief Financial Officer
Paige Bombino
Investor Relations
(408) 964-3610
FOR IMMEDIATE RELEASE
SANMINA-SCI ANNOUNCES THIRD QUARTER RESULTS
SAN JOSE, CA (JULY 20, 2004) -- Sanmina-SCI Corporation (NASDAQ NM: SANM),
a leading global electronics manufacturing services (EMS) company, today
reported financial results for its third quarter ended June 26, 2004. A
reconciliation from pro forma to GAAP results is contained in the attached
financials and is available on the Investor Relations section of our
website at www.sanmina-sci.com.
THIRD QUARTER FISCAL 2004 HIGHLIGHTS INCLUDE:
o REVENUES OF $3.07 BILLION IN LINE WITH COMPANY GUIDANCE
o PRO FORMA EPS OF $0.07 AT THE HIGH-END OF COMPANY GUIDANCE AND ABOVE
STREET CONSENSUS
o INVENTORY TURNS INCREASED TO 10.4X
o EXPANSION THROUGH ACQUISITION STRENGTHENS COMPANY'S PRESENCE IN ASIA
o REDUCING CAPACITY AS A RESULT OF ACHIEVING GREATER EFFICIENCIES
SUMMARY OF PRO FORMA FINANCIAL RESULTS
(Excludes restructuring, integration, impairment, other infrequent or
unusual items and non-cash interest and amortization expense. Please note
that we have excluded non-cash interest and amortization expense from our
pro forma operating results to enhance comparability with other companies
in the EMS industry.)
(In thousands, except per share data) Q3:04 Q3:03 9MOS04 9MOS03
Revenue $3,069,783 $2,648,907 $8,902,450 $7,629,421
Operating Margin 2.2% 1.5% 2.1% 1.2%
Operating Income $ 68,760 $ 39,988 $ 182,781 $ 93,151
Net Income $ 34,388 $ 6,418 $ 87,157 $ 14,319
Earnings per share - diluted $ 0.07 $ 0.01 $ 0.16 $ 0.03
Sanmina-SCI Corporation
July 20, 2004
Page 2
SUMMARY OF GAAP FINANCIAL RESULTS
(Includes restructuring, integration, impairment, other infrequent or
unusual items and non-cash interest and amortization expense.)
(In thousands, except per share data) Q3:04 Q3:03 9MOS04 9MOS03
Revenue $3,069,783 $2,648,907 $8,902,450 $7,629,421
Operating Margin 1.5% 0.7% 0.7% (0.2)%
Operating Income (loss) $ 46,500 $ 17,997 $ 61,228 $ (12,478)
Net Income (loss) $ 11,351 $ (12,174) $ (16,736) $ (51,504)
Earnings (loss) per share - basic $ 0.02 $ (0.02) $ (0.03) $ (0.10)
Earnings (loss) per share - diluted $ 0.02 $ (0.02) $ (0.03) $ (0.10)
PRO FORMA FINANCIAL PERFORMANCE IN THE THIRD QUARTER
For the quarter ended June 26, 2004, Sanmina-SCI reported revenues of $3.07
billion, an increase of 7.2% from $2.86 billion in the second quarter ended
March 27, 2004, and an increase of 15.9% from $2.65 billion in the third
quarter ended June 28, 2003. Operating income was $68.8 million, an
increase of 21.1% over the prior quarter and up 72.0% over the same period
last year.
For the third quarter of fiscal 2004 the company reported a pro forma net
income of $34.4 million, or $0.07 pro forma diluted earnings per share,
compared to pro forma net income of $6.4 million, or $0.01 pro forma
diluted earnings per share for the same period a year ago. Pro forma
financial results do not include restructuring, integration, impairment,
other infrequent or unusual items and non-cash interest and amortization
expense.
In the third quarter ended June 26, 2004, financial management ratios
strengthened over the second quarter ended March 27, 2004 as cash cycle
days improved to 31 days, inventory turns improved to 10.4x from 9.3x, and
DSO improved 5 days to 47 days.
At June 26, 2004, the Company reported $1 billion in cash and short-term
investments. At quarter-end, the Company reported a current ratio of 2.0,
working capital of $2.2 billion, and stockholders' equity of $3.3 billion.
Jure Sola, Chairman and Chief Executive Officer of Sanmina-SCI, said, "Our
results this quarter are primarily due to growth in key customer
end-markets and increased demand for our high-end EMS product programs. We
believe the company's expanding revenue base and continuing success in
meeting its strategic goals are due to best-in-class engineering, advanced
technology, vertical integration manufacturing, and diversified target
markets. These world-class capabilities provide the company with a
significant strategic advantage."
COMPANY ANNOUNCES RESTRUCTURING
Sanmina-SCI plans to take capacity out of its North American and Western
European operations, and will incur a restructuring charge of up to
approximately $100 million.
"Our Eastern European, Latin American and Asian operations are operating
more efficiently than previously forecast. 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," said Sola. "During
the quarter we announced that we will acquire a printed circuit board (PCB)
fabrication company in Asia, in turn expanding our capabilities in the
region and strengthening market opportunities. We fully expect our
restructuring efforts and previously announced acquisition to enable the
Company to provide superior service to our customers worldwide,
accelerating their transition of manufacturing requirements to lower-cost
locations while allowing us to meet our financial growth objectives,"
concluded Sola.
COMPANY OUTLOOK
Sanmina-SCI reaffirms fourth quarter fiscal 2004 revenue to be in the range
of $3.1 billion to $3.3 billion, and pro forma diluted earnings per share
to be between $0.08 to $0.10 before integration, restructuring
-more-
Sanmina-SCI Corporation
July 20, 2004
Page 3
and impairment charges, other infrequent or unusual items and non-cash interest
and amortization expense.
PRO FORMA FINANCIAL INFORMATION
In addition to disclosing operating results determined in accordance with
generally accepted accounting principles (GAAP), Sanmina-SCI also provides
pro forma operating results that exclude certain items. Management utilizes
pro forma operating results as a performance measure and furnishes the
information in order to provide investors with additional information to
analyze the Company's operating results and facilitate period-to-period
comparisons.
COMPANY CONFERENCE CALL INFORMATION Sanmina-SCI will be holding a conference
call regarding this announcement on Tuesday, July 20, 2004 at 5:00 p.m. EDT
(2:00 p.m. PDT). The access numbers are: domestic 877-273-6760 and
international: 706-634-6605. The conference will be broadcast live over the
Internet. Log onto the live webcast at
http://www.firstcallevents.com/service/ajwz407842903gf12.html. Additional
information in the form of a slide presentation is available by logging onto
Sanmina-SCI's website at www.sanmina-sci.com. A replay of today's conference
call will be available for 48-hours. The access numbers are: domestic
800-642-1687 and international: 706-645-9291, access code: 8398215.
ABOUT SANMINA-SCI
Sanmina-SCI Corporation (NASDAQ: SANM) is a leading electronics contract
manufacturer serving the fastest-growing segments of the global electronics
manufacturing services (EMS) market. Recognized as a technology leader,
Sanmina-SCI provides end-to-end manufacturing solutions, delivering
superior quality and support to large OEMs primarily in the communications,
defense and aerospace, industrial and medical instrumentation, computer
technology and multimedia sectors. Sanmina-SCI has facilities strategically
located in key regions throughout the world. Information about Sanmina-SCI
is available at www.sanmina-sci.com.
SANMINA-SCI SAFE HARBOR STATEMENT
The foregoing, including the discussion regarding the company's future
prospects, contains certain forward-looking statements that involve risks
and uncertainties, including uncertainties associated with economic
conditions in the electronics industry, particularly in the principal
industry sectors served by the company, changes in customer requirements
and in the volume of sales to principal customers, the ability of
Sanmina-SCI to effectively assimilate acquired businesses and achieve the
anticipated benefits of its acquisitions, and competition and technological
change. The company's actual results of operations may differ significantly
from those contemplated by such forward-looking statements as a result of
these and other factors, including factors set forth in the company's
fiscal year 2003 Annual Report on Form 10-K filed on December 9, 2003 and
Form 10-Q filed on May 11, 2004, with the Securities Exchange Commission.
-FINANCIAL TABLES FOLLOW-
PRESS RELEASE FINANCIALS SANMINA-SCI
2700 North First Street
San Jose, CA 95134
(408) 964-3500
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
Three Months Ended June 26, 2004 Three Months Ended June 28, 2003
--------------------------------------- ---------------------------------------
Pro forma Pro forma Pro forma Pro forma
(1) Adjustments GAAP (1) Adjustments GAAP
----------- ----------- ----------- ----------- ----------- -----------
Net sales $ 3,069,783 -- $ 3,069,783 $ 2,648,907 -- $ 2,648,907
Cost of sales 2,911,260 -- 2,911,260 2,529,271 -- 2,529,271
----------- ----------- ----------- ----------- ----------- -----------
Gross profit 158,523 -- 158,523 119,636 -- 119,636
Operating expenses:
Selling, general and administrative 82,437 2,591 85,028 77,220 1,700 78,920
Research and development 7,326 -- 7,326 2,428 -- 2,428
Amortization of intangibles -- 2,059 2,059 -- 1,626 1,626
Integration costs -- 261 261 -- 1,889 1,889
Restructuring costs -- 17,349 17,349 -- 16,776 16,776
----------- ----------- ----------- ----------- ----------- -----------
Total operating expenses 89,763 22,260 112,023 79,648 21,991 101,639
----------- ----------- ----------- ----------- ----------- -----------
Operating income (loss) 68,760 (22,260) 46,500 39,988 (21,991) 17,997
Other income (expense), net (21,653) (15,198) (36,851) (30,405) (5,762) (36,167)
----------- ----------- ----------- ----------- ----------- -----------
Income (loss) before provision for income taxes 47,107 (37,458) 9,649 9,583 (27,753) (18,170)
Provision (benefit) for income taxes 12,719 (14,421) (1,702) 3,165 (9,161) (5,996)
----------- ----------- ----------- ----------- ----------- -----------
Net income (loss) $ 34,388 $ (23,037) $ 11,351 $ 6,418 $ (18,592) $ (12,174)
=========== =========== =========== =========== =========== ===========
Earnings (loss) per share:
Basic $ 0.07 $ 0.02 $ 0.01 $ (0.02)
Diluted $ 0.07 $ 0.02 $ 0.01 $ (0.02)
Shares used in computing per share amounts:
Basic 517,173 517,173 510,372 510,372
Diluted 528,275 528,275 513,952 510,372
(1) Pro forma results of operations exclude restructuring and integration
costs, impairment and other infrequent or unusual charges and non-cash
interest and amortization expense.
PRESS RELEASE FINANCIALS SANMINA-SCI
2700 North First Street
San Jose, CA 95134
(408) 964-3500
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
Nine Months Ended June 26, 2004 Nine Months Ended June 28, 2003
--------------------------------------- ---------------------------------------
Pro forma Pro forma Pro forma Pro forma
(1) Adjustments GAAP (1) Adjustments GAAP
----------- ----------- ----------- ----------- ----------- -----------
Net sales $ 8,902,450 -- $ 8,902,450 $ 7,629,421 -- $ 7,629,421
Cost of sales 8,457,637 -- 8,457,637 7,296,105 -- 7,296,105
----------- ----------- ----------- ----------- ----------- -----------
Gross profit 444,813 -- 444,813 333,316 -- 333,316
Operating expenses:
Selling, general and administrative 240,787 2,591 243,378 232,544 1,700 234,244
Research and development 21,245 -- 21,245 7,621 -- 7,621
Amortization of intangibles -- 6,460 6,460 -- 4,863 4,863
Integration costs -- 4,043 4,043 -- 8,248 8,248
Restructuring costs -- 108,459 108,459 -- 90,818 90,818
----------- ----------- ----------- ----------- ----------- -----------
Total operating expenses 262,032 121,553 383,585 240,165 105,629 345,794
----------- ----------- ----------- ----------- ----------- -----------
Operating income (loss) 182,781 (121,553) 61,228 93,151 (105,629) (12,478)
Other income (expense), net (63,389) (27,200) (90,589) (71,788) 7,395 (64,393)
----------- ----------- ----------- ----------- ----------- -----------
Income (loss) before provision for income taxes 119,392 (148,753) (29,361) 21,363 (98,234) (76,871)
Provision (benefit) for income taxes 32,235 (44,860) (12,625) 7,044 (32,411) (25,367)
----------- ----------- ----------- ----------- ----------- -----------
Net income (loss) $ 87,157 $ (103,893) $ (16,736) $ 14,319 $ (65,823) $ (51,504)
=========== =========== =========== =========== =========== ===========
Earnings (loss) per share:
Basic $ 0.17 $ (0.03) $ 0.03 $ (0.10)
Diluted $ 0.16 $ (0.03) $ 0.03 $ (0.10)
Shares used in computing per share amounts:
Basic 515,159 515,159 509,891 509,891
Diluted 529,366 515,159 512,111 509,891
(1) Pro forma results of operations exclude restructuring and integration
costs, impairment and other infrequent or unusual charges and non-cash
interest and amortization expense.
PRESS RELEASE FINANCIALS SANMINA-SCI
2700 North First Street
San Jose, CA 95134
(408) 964-3500
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
(GAAP)
June 26, September 27,
2004 2003
---------- ----------
(Unaudited) (Derived from
ASSETS audited financials)
Current assets:
Cash and short-term investments $1,021,326 $1,082,988
Accounts receivable, net 1,658,448 1,576,392
Inventories, net 1,119,858 977,799
Deferred income taxes 426,255 421,478
Prepaid and other current assets 106,191 109,862
---------- ----------
Total current assets 4,332,078 4,168,519
Property, plant and equipment, net 811,958 902,868
Goodwill 2,248,486 2,223,422
Long-term investments 17,108 15,614
Deposits and other 119,192 139,833
---------- ----------
Total assets $7,528,822 $7,450,256
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 2,884 $ 3,489
Accounts payable 1,615,993 1,506,998
Accrued liabilities and other 343,062 394,906
Accrued payroll and related benefits 173,755 130,660
---------- ----------
Total current liabilities 2,135,694 2,036,053
Long-term liabilities:
Convertible subordinated debentures 1,122,496 1,103,537
Long-term debt 781,985 822,093
Deferred income taxes 88,870 90,294
Other 70,362 75,025
Total stockholders' equity 3,329,415 3,323,254
---------- ----------
Total liabilities and stockholders' equity $7,528,822 $7,450,256
========== ==========
PRESS RELEASE FINANCIALS SANMINA-SCI
2700 North First Street
San Jose, CA 95134
(408) 964-3500
FORWARD LOOKING GUIDANCE
THREE MONTHS ENDED OCTOBER 2, 2004
(IN BILLIONS, EXCEPT PER SHARE AMOUNTS)
Net sales $3.1 - $3.3
Pro forma earnings per share (1) $0.08 - $0.10
(1) Forward looking guidance for the quarter ended October 2, 2004 is provided
only on a pro forma basis. The comparable GAAP earnings or loss per share
amount is not accessible due to inherent difficulties in predicting
certain expenses and gains affecting GAAP earnings or loss, such as the
amount and timing of Sanmina-SCI's restructuring costs, as well as debt
security repurchases, if any, that could result in gains or losses
reported in GAAP earnings.