Benchmark Electronics, Inc. · NYSE:BHE

Benchmark Electronics — Proxy Contest (April 2016)

17 slides from Benchmark Electronics's proxy contest presentation, Apr 21, 2016

1. Slide 1: Supplemental Presentation

   Connecting Markets East & West Supplemental Presentation STRICTLY PRIVATE AND CONFIDENTIAL April 20, 2016 © Nomura

2. Slide 2: Benchmark Electronics' Working Capital Analysis is Flawed

   Benchmark Electronics’ Working Capital Analysis is Flawed

3. Slide 3: BHE's Days Inventory is Less Efficient than Nearly all Peers

   BHE’s Days Inventory is Less Efficient than Nearly all Peers Days Inventory (DI) 100 90 87 80 70 65 60 57 51 50 50 48 40 30 20 10 0 PLXS BHE SANM CLS FLEX JBL We believe BHE’s higher Days Inventory is partially explained by its higher non-traditional revenue mix 2

4. Slide 4: Days Inventory is the ONLY Component of Cash Conversion Cycle Correlated to Mix

   Days Inventory is the ONLY Component of Cash Conversion Cycle that is Correlated to Non-Traditional Revenue Mix Days Inventory (DI) vs Non-Traditional Mix  BHE’s statement that “end-market mix and 90 PLXS shipping terms drive discrepancies between 85 80 accounts receivable and inventory between pee

5. Slide 5: We Believe BHE's Logic to Combine DSOs + DI is Nonsensical

   We Believe BHE’s Logic to Combine DSOs + DI is Nonsensical  BHE is arguing that Days Inventory and DSOs are interchangeable, and BHE is choosing to trade off higher DSOs for lower Days Inventory vs. PLXS – However, based on differences in mix, we would expect BHE’s Days Inventory to be below PLXS 

6. Slide 6: Benchmark's Days Payable Inefficiency Remains Unexplained by the Company

   Benchmark’s Days Payable Inefficiency Remains Unexplained by the Company

7. Slide 7: BHE's DPOs are Well Below PLXS Levels Even After Adjusting for Trade Discounts

   BHE’s DPOs are Well Below PLXS Levels Even After Adjusting for Trade Discounts BHE Pro Forma for Trade Discounts Comparison to PLXS  BHE’s DPOs are significantly lower than PLXS, even after adjusting for the seven days BHE 100 DPO from 47 to 70 days: management attributes to trade discounts it ~$15

8. Slide 8: Benchmark's Valuation of Trade Discounts Uses Incorrect Multiples

   Benchmark’s Valuation of Trade Discounts Uses Incorrect Multiples

9. Slide 9: BHE's Calculation of the Value of Trade Discounts is Inflated

   BHE’s Calculation of the Value of Trade Discounts is Inflated by Using Flawed, Unadjusted Multiples Per Share Value of Trade Discounts Less Cash Released from Forgoing Discounts1 $1.20 Unadjusted P/E multiple: Adjusted P/E multiple: Adjusted EBITDA multiple: $1.00 12.4x1 9.2x 5.0x $0.86 $0.80 The su

10. Slide 10: The Acquisition of Secure

    Cee The Acquisition of Secure

11. Slide 11: The Secure Acquisition Was Costly and Non-Core

    The Secure Acquisition Was Costly and Non-Core Recent BHE M&A Characteristics1 Suntron CTS Secure Purchase Price ($M) $19 $75 $230 % of Enterprise Value at ~3% ~9% ~38% Announcement Revenue ($M) $67 $200 $100 EV/Revenue Multiple 0.3x 0.4x 2.3x Margin Profile Undisclosed In-line with BHE 3x Core EMS

12. Slide 12: ROIC Adjustments

    Cee ROIC Adjustments

13. Slide 13: BHE's Calculation of Peer ROIC Adjusted for Accumulated Deficit is Flawed

    BHE’s Calculation of Peer ROIC Adjusted for Accumulated Deficit is Flawed Transaction CFROI Forecast - Current Fiscal Year  BHE argues ROIC comparisons can be misleading 12% because several EMS peers have significant 9.8% 10% accumulated deficits, mainly due to goodwill and other Transaction CFROI

14. Slide 14: Appendix

    Cee Appendix

15. Slide 15: Value of Trade Discounts

    Value of Trade Discounts Description Data Source P/E-based Value of Trade Discounts Per Share Value of Trade Discounts $1.66 BHE presentation, filed 4/14/2016 Less: Per Share Cash Value Released by Forgoing Trade Discounts ($0.80) BHE presentation, filed 4/14/2016 Per Share Net Value of Trade Discou

16. Slide 16: Valuation Multiples

    Valuation Multiples Reference Description Value After Tax Shares Per Share Source / Calculation A Price $22.05 FactSet, as of 4/11/2016 B 2016E EPS Estimate $1.60 FactSet, as of 4/11/2016 C As Reported 2016E P/E 13.8x A/B D EPS Add back: Amortization E Secure 8 6 EC Estimate, 24.5% tax rate F Other

17. Slide 17: Valuation Multiples (cont'd)

    Valuation Multiples (cont’d) Reference Description Value Source / Calculation A Enterprise Value 876 FactSet, as of 4/11/2016 B 2016E EBITDA Estimate 166 FactSet, as of 4/11/2016 C As Reported 2016E EV/EBITDA Multiple 5.3x A/B D EBITDA Plus: Amortization of Intangibles for Secure Transaction 8 EC es

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