Benchmark Electronics, Inc. · NYSE:BHE
Benchmark Electronics — 25th Annual Needham Growth Conference (January 2023)
24 slides from Benchmark Electronics's conference presentation, Jan 10, 2023
Slide 1: Benchmark Electronics Investor Presentation
Benchmark Benchmark Electronics Investor Presentation January, 2023 | 1
Slide 2: Forward-Looking Statements Non-GAAP Financial Information
Forward-Looking Statements Non-GAAP Financial Information This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as Management discloses non‐GAAP information to provide inve
Slide 3: Benchmark By the Numbers
Benchmark By the Numbers 2.9 billion * Sector Growth * $ 41% growth in Complex Industrial 2022 FYE revenue 31% growth in Medical 32% growth * Assuming mid-point of Q4:22 guidance and in Semi-Cap including supply chain premium 21 Global Manufacturing 12,500+ Experts in complex products and adept at m
Slide 4: Global Services Locations
Global Services Locations Product Design & Engineering Centers United States Europe Electronics 1. Concord, CA Manufacturing 1. Almelo, The Netherlands 2. Fremont, CA 2. Brasov, Romania Precision Technologies 3. Santa Ana, CA Manufacturing 4. Phoenix, AZ Centers of Excellence 5. Tempe, AZ (2) 6. Win
Slide 5: Benchmark Focus
Benchmark Focus Deliver our Vision – Operational Invest for Financial Model “When it Matters” Excellence Sustainability Discipline | 5
Slide 6: Deliver Our Vision - "When It Matters"
Deliver our Vision - “When it Matters” | 6
Slide 7: EMS Market Summary
EMS Market Summary 2021 EMS Market Size Next-generation Outsourcing $544B Opportunities 2021–2026 EMS Medical < 50% Revenue CAGR Targeted Complex Markets A&D < 25% ~$100B 6.8% Industrials* < 30% Market Growth Supported by Increasing Outsourcing Opportunities Source: New Venture Research Corp r
Slide 8: Our Sector Focus
Our Sector Focus Delivers a competitive advantage across multiple growth drivers Semiconductor Defense Sector Lifecycle CAGR* Automation Proliferation Modernization Medical 8+ years 5% Aerospace & Defense 12+ years 3% Digital Healthcare Miniaturization Robotics Industrials 6+ years 4% Semi-Cap 10+ y
Slide 9: Our Evolution to Higher Value Sectors
Our Evolution to Higher Value Sectors FY12A 10% 5% 27% 25% 32% Medical Semi-Cap Industrials Telco Computing FY22E 19% HC/LS 27% 19% I/C 13% 10% A/D 12% N/C 21% 30% 17% 14% Medical Semi-Cap Industrials A&D Telco Computing Excluding supply chain premium Highly complex products and demanding regulatory
Slide 10: Sector Focus
Sector Focus Participation Select Customers Front-end Wafer Fabrication Equipment Semi-Cap Material Handling and Control Systems Fluid Management Radiological and Optical Imaging Medical Medical Robotics Connected & Diagnostic Devices Automation & Robotics Industrials Control, Meas
Slide 11: Operational Excellence
Operational Excellence > Benchmark | 11 Copyright © 2023 by original author Benchmark Electronics, Inc. Not to be reproduced, distributed, or used in any means without written permission by Benchmark
Slide 12: Investing in Capabilities to Support Growth
Investing in Capabilities to Support Growth Medical Complex Industrial FDA Class 3 Regulatory Mechatronics Microfluidics Engineering Firmware Development Mechatronics Full Product Design Complex Automation High Volume Automation Miniaturization Robotics High Speed Design Supply
Slide 13: Focused Investment Discipline
Focused Investment Discipline Investment Priorities Regulatory & Compliance Capex% of Revenue Strategic Growth Capital Expenditures ($000) 2.1% 1.9% 1.9% 1.5% Margin Accretive Capability $32,576 $34,585 $38,794 $55,000 Leading Edge Process Technologies FY19 FY20 FY21 FY22E Capex increasing to 2% of
Slide 14: Invest for Sustainability
Invest for Sustainability | 14
Slide 15: Sustainability is Core to Our Strategy
Sustainability is Core to Our Strategy Environmental Social Governance 2021 Inaugural Sustainability Report Benchmark is an inclusive Independent Board operates 2022: Set GHG intensity targets organization under a contemporary set of • 52% of our workforce are women published Corporate Gover
Slide 16: Financial Model Discipline
Financial Model Discipline | 16
Slide 17: Delivering on Our Commitments
Delivering on Our Commitments ($Millions, except per share data) Revenue Growth Non-GAAP Operating Income Earnings Growth Mid-Term Model 5% Growth 3.4%* to 3.8%(1) Growth Rate > Revenue Growth FY22E 28% Growth (2) 3.9% (1, 2) 122% non-GAAP EPS Growth 3.9% 28% 122% $2,639 3.2% $104 $2.11 $2,053 $2,16
Slide 18: Capital Allocation Trends
Capital Allocation Trends $105 $88 $88 $40 $10 $25 ($ Millions) $55 $40 $42 $23 $23 $23 FY20 FY21 FY22E Cash Dividend Capex Share Repurchase | 18
Slide 19: Driving Return on Invested Capital
Driving Return on Invested Capital * 10.1% 8.6% 6.2% FY20 FY21 FY22E * Non-GAAP ROIC = (Non-GAAP TTM income from operations + Stock-based compensation – Non-GAAP Tax Impact) ÷ [Average Invested Capital for last 5 quarters} | 19
Slide 20: 2023 Guidance and 2025 Target Model
2023 Guidance and 2025 Target Model 2022E 22% 3.9% $2.11 10% N/A Guidance (1) Revenue Growth (2) Non-GAAP Operating Margin (3) Non-GAAP EPS Non-GAAP ROIC (4) Free Cash Flow 2023 10% 4.3% $2.40 >10% $80M Guidance (1) Revenue Growth (2) Non-GAAP Operating Margin (3) Non-GAAP EPS Non-GAAP ROIC (4) Free
Slide 21: Compelling Investment Opportunity
Compelling Investment Opportunity Macro & secular Unique capabilities Operational Strong, profitable growth growth drivers positioned to win excellence & margin expansion Strategic roadmap to Advanced global manufacturing, Transformed portfolio and Confidence in our ability to address multiple, supp
Slide 22: Benchmark, the partner you choose When it matters.
Benchmark, the partner you choose When it matters. | 22
Slide 23: APPENDIX 1 - Reconciliation of GAAP to non-GAAP Financial Results
APPENDIX 1 - Reconciliation Year Ended Dec 31, 2021 2020 2019 of GAAP to non-GAAP Income from operations (GAAP) $ 53,062 $ 25,134 $ 28,545 Amortization of intangible assets 6,384 9,099 9,461 Restructuring charges and other costs 9,341 13,227 13,101 Impairment 4,358 6,743 — Financial Results Ransomwa
Slide 24: APPENDIX 2 - Reconciliation of Supply Chain Premiums
APPENDIX 2 - Reconciliation of Supply Chain Premiums (Amounts in Millions) – (UNAUDITED) Year Ended Dec 31, Dec 31, Dec 31, 2022E 2021 2020 Sales (GAAP) 2,916 2,255 2,053 Adjustment for supply chain premiums (277) (87) - Non-GAAP sales adjusted for supply chain premiums 2,639 2,168 2,053 Non-GAAP co
Benchmark Electronics — 25th Annual Needham Growth Conference (January 2023) on 6ix