Slide 1: Results for Q3 Fiscal 2020
Results for Q3 Fiscal 2020 Earnings Announcement: January 30, 2020 (Quarter Ended December 31, 2019)
Slide 2: Risks and Non-GAAP Disclosures
Risks and Non-GAAP Disclosures This presentation contains forward-looking statements within the meaning of U.S. securities laws. All statements, other than statements of historical fact, that address activities, events or developments that we expect, believe or anticipate will or may occur in the fu
Slide 3: Business Update
Business Update Revathi Advaithi, CEO
Slide 4: Q3 FY2020 Business Summary
Q3 FY2020 Business Summary Revenue ($M) Adj. Operating Adj. Earnings Adj. Free Cash Income ($M) Per Share Flow ($M) 6,923 Adj. Operating Margin $0.34 $0.38 6,663 4.0% 238 6,461 3.7% 3.7% 3.4% $0.34 187 6,088 $0.31 224 227 119 $0.29 256 256 (60) Sep-18Q2Sep-19 Dec-18 Q3Dec-19 Sep-18 Sep-19 Dec-18 Dec
Slide 5: Approach to Managing the Business
Approach to Managing the Business Manage Drive Pursue Generate Grow portfolio to disciplined, design-led adjusted free cash Drive profitable improve mix and sustainable manufacturing for flow and have growth and market profitability execution better margins prudent capital leadership allocation We d
Slide 6: Q3 2020 Financial Results
Q3 2020 Financial Results Chris Collier, CFO
Slide 7: Q3 FY2020 Income Statement Summary
Q3 FY2020 Income Statement Summary ($M, except per share amounts) Prior Yr Current Qtr Results vs. Guidance December 31, 2018 December 31, 2019 » Net sales of $6.5B is Net sales $6,923 $6,461 above the guidance range of $6.0-$6.3B Adjusted operating income 256 256 » Adjusted operating Adjusted net i
Slide 8: Quarterly Financial Highlights
Quarterly Financial Highlights Adj. Gross Profit ($M) Adj. SG&A ($M) Adj. Operating Income ($M) Adj. Gross Margin % of Revenue Adj. Operating Margin 7.8% 7.7% 7.6% 7.1% 7.5% 7.4% 7.3% 7.2% 3.1% 4.0% 7.1% 7.0% 6.5% 6.9% 6.8% 6.7% 2.8% 3.7% 6.6% 6.5% 6.4% 6.3% 6.2% 6.1% 459 6.0% 5.9% 203 453 5.8% 5.7%
Slide 9: Q3 FY2020 Business Group Performance
Q3 FY2020 Business Group Performance Adjusted Operating Revenue Income & Margin ($M) Y/Y Growth ($M) HRS $1,245 3% $82 6.6% Continuing investments into ramping business Strong revenue and earnings growth across the IEI $1,989 20% $124 6.3% portfolio, led by energy Profitability benefitted from cost
Slide 10: Cash Flow Generation Highlights
Cash Flow Generation Highlights Inventory and Inventory Days* ($M) Net Capital Expenditures** ($M) Adjusted Free Cash Flow ($M) Inventory Days Adj. FCF Conversion 60 60 59 59 123% 92% 118% 66% 83% 56 3,898 155 238 3,723 3,746 3,721 3,684 126 123 187 95 119 129 114 55 Dec-18 Mar-19 Jun-19 Sep-19 Dec-
Slide 11: Fourth Quarter Fiscal 2020 Guidance – March 2020
Fourth Quarter Fiscal 2020 Guidance – March 2020 Guidance Business Group Revenue Outlook (Y/Y) Revenue $5,800 - $6,200 million HRS Flat to up 5% Adjusted Operating Income $220 - $250 million Adjusted Earnings Per Share $0.30 - $0.34 IEI Up 20% to 25% GAAP Income Before Income Taxes $120 – $145 milli
Slide 12: Summary
Summary • We exceeded our adjusted EPS guidance range with record quarterly performance • We displayed strong adjusted operating margin expansion benefitting from a richer mix of business and cost discipline • We demonstrated solid cash flow generation • We continued to invest in manufacturing capab
Slide 13: For more information, go to investors.flex.com
For more information, go to investors.flex.com 12
Slide 14: Appendix: Reconciliation of GAAP to Non-GAAP Measures
Appendix: Reconciliation of GAAP to Non-GAAP Measures Quarter-ended Quarter-ended Quarter-ended Quarter-ended December 31, 2019 September 27, 2019 December 31, 2018 September 28, 2018 ($Thousands, except per share amounts) GAAP income (loss) before income taxes $145,389 ($95,693) ($31,913) $108,794
Slide 15: Appendix: Reconciliation of GAAP to Non-GAAP Measures
Appendix: Reconciliation of GAAP to Non-GAAP Measures Quarter-ended Quarter-ended December 31, 2019 December 31, 2018 ($Thousands) % of revenue % of revenue GAAP gross profit $430,477 6.7% $357,325 5.2% Stock-based compensation expense 4,275 4,769 Customer related asset impairments 4,368 29,491 Rest
Slide 16: Appendix: Reconciliation of GAAP to Non-GAAP Measures
Appendix: Reconciliation of GAAP to Non-GAAP Measures Quarter-ended Quarter-ended December 31, 2019 December 31, 2019 ($Thousands) ($Thousands) Segment income: Reconciliation of segment income to income before income taxes Communication & Enterprise Compute $53,086 Total segment income $256,038 Cons
Slide 17: Appendix: Reconciliation of GAAP to Non-GAAP Measures
Appendix: Reconciliation of GAAP to Non-GAAP Measures Quarter-ended Quarter-ended Quarter-ended Quarter-ended Quarter-ended ($Thousands, except for conversion %) December 31, 2019 September 27, 2019 June 28, 2019 March 31, 2019 December 31, 2018 Net cash used in operating activities ($50,894) ($991,
Slide 18: Slide 18