Slide 1: Benchmark Electronics Third Quarter 2023 Earnings
Benchmark Benchmark Electronics Third Quarter 2023 Earnings October 25, 2023 | 1
Slide 2: Forward-Looking Statements and Non-GAAP Financial Information
Forward-Looking 2023 Statements Non-GAAP Financial Information This document contains forward-looking statements within the meaning of Section 27A of the Management discloses non‐GAAP information to provide investors with additional information to Securities Act of 1933, as amended and Section 21E o
Slide 3: Third Quarter 2023 Results
Third Quarter 2023 Results • Revenue of $720 million - Total revenue impacted by $58 million reduction in supply chain premium (SCP)* - Excluding SCP, year-over-year growth in 4 of 6 sectors • GAAP and non-GAAP** gross margin of 9.6% - Expansion of 90 and 100 basis points year-over-year, respectivel
Slide 4: Roop Lakkaraju, Chief Financial Officer
Roop Lakkaraju Chief Financial Officer | 4
Slide 5: Third Quarter GAAP Revenue by Market Sector
Third Quarter GAAP Revenue by Market Sector 12% 9% Revenue by Mix and Market Sector For the Three Months Ended Dollars in Millions Sep 30, 2023 Jun 30, 2023 Sep 30, 2022 Q3-23 21% Q/Q 21% Sector Mix % Revenue Mix % Revenue Growth Mix % Revenue Y/Y Growth Medical 21% $149 20% $145 3% 21% $166 (10%) S
Slide 6: Sector Results Excluding Supply Chain Premium
Sector Results Excluding Supply Chain Premium Q3-23 Results ($MM) Supply Chain Revenue adjusted Year-over-Year growth Total Revenue Premiums (SCP) for SCP adjusted for SCP Medical $149 $(2) $147 8% Semi-Cap $165 $(1) $164 (10%) A&D $100 $0 $100 20% Industrials $154 $(11) $143 9% Advanced Computing $
Slide 7: Third Quarter 2023 Financial Summary
Third Quarter 2023 Financial Summary (Dollars in millions, except Sep 30, 2023 Jun 30, 2023 Q/Q Sep 30, 2022 Y/Y EPS) Net Sales $720 $733 (2%) $772 (7%) GAAP Gross Margin 9.6% 9.1% 50 bps 8.7% 90 bps GAAP SG&A $35.5 $37.7 (6%) $38.5 (8%) GAAP Operating Margin 4.2% 3.3% 90 bps 3.3% 90 bps GAAP Dilute
Slide 8: Non-GAAP Financial Summary Excluding Supply Chain Premiums
Non-GAAP Financial Summary Excluding Supply Chain Premiums (Dollars in millions, except EPS) See APPENDIX 1 and APPENDIX 2 for reconciliations of GAAP to non-GAAP Financial Results | 8
Slide 9: Cash Conversion Cycle Update
Cash Conversion Cycle Update Q3-23 Q2-23 Q1-23 Q4-22 Q3-22 Accounts Receivable Days 60 59 60 59 56 Contract Asset Days 24 23 25 22 22 Inventory Days 100 102 111 97 95 Accounts Payable Days (53) (56) (60) (56) (67) Customer Days (26) (25) (27) (26) (27) Cash Conversion Cycle 105 103 109 96 79 | 9
Slide 10: Liquidity and Capital Allocation
Liquidity and Capital Allocation For the Three Months Ended • Recurring quarterly dividend of Sep 30, Jun 30, Sep 30, Cash (In millions) 2023 2023 2022 $0.165 per share totaling $5.9 Cash Flows from (used in) Operations $38 $25 ($31) million paid in July 2023 FCF (1) $18 $16 ($40) • No share repurch
Slide 11: Fourth Quarter 2023 Guidance
Fourth Quarter 2023 Guidance Q4-2023 Net Sales* $675 - $725 million Diluted EPS – GAAP $0.49 - $0.55 Diluted EPS – non-GAAP $0.54 - $0.60 Operating Margin – non-GAAP 4.8% - 5.0% Other Expenses, Net ~ $9 million Effective Tax Rate 19% - 21% Weighted Average Shares ~ 35.9 million * Guidance does not i
Slide 12: Business Trends - Jeff Benck, CEO
Business Trends Jeff Benck - CEO | 12
Slide 13: Sector Outlook
Sector Outlook* Q4-23 FY2023 Sector Commentary Q/Q Y/Y • Improved supply enabled us to meet demand Medical • Demand adjusting amid dynamic macro environment • Continuing to win new opportunities ramping in 2024-2025 • Current market outlook points to a flat 2024 Semi-Cap • New program wins helping t
Slide 14: Summary
Summary • Exceeded mid-point of guidance for Q3 2023 • Delivered strong year-over-year growth in 4 of 6 sectors* • Expanded non-GAAP operating margin by >80 basis points year-over-year* • Grew non-GAAP operating income 22% year-over-year • Increased free cash flow generation, annualized at >$70 mill
Slide 15: Appendix
Appendix Benchmark 15 Copyright © 2023 by original author Benchmark Electronics, Inc. Not to be reproduced, distributed, or used in any means without written permission by Benchmark.
Slide 16: Reconciliation of GAAP to non-GAAP Financial Results
APPENDIX 1 - Reconciliation of GAAP to non-GAAP Financial Results (Dollars in Thousands, Except Per Share Data) – (UNAUDITED) | 16
Slide 17: Reconciliation of Supply Chain Premiums
APPENDIX 2 - Reconciliation of Supply Chain Premiums (Dollars in Millions) – (UNAUDITED) | 17
Slide 18: Reconciliation of Supply Chain Premiums by Sector
APPENDIX 3 - Reconciliation of Supply Chain Premiums by Sector (Dollars in Millions) – (UNAUDITED) | 18