Slide 1: Q1-20 Earnings Call April 29, 2020
| 1 Q1 - 20 Earnings Call April 29, 2020
Slide 2: Forward-looking statements
| 2 | 2 This press release contains forward - looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The words "expect," "estimate," "anticipate," "could" "predict" and similar expressions, and the negatives thereof,
Slide 3: Benchmark Response to COVID-19 Global Pandemic
| 3 Senior Leadership Team daily coordination to prioritize actions, resolve escalations, and provide guidance COVID - 19 daily task force responds to operational issues and shares best practices (site safety protocols, employee needs, etc.) ‒ Enacted centralized operational protocols ‒ Leads re
Slide 4: Status of Operations
| 4 Status of Operations Asia Europe U.S. Mexico • Varied impacts throughout U.S. operations due to state shelter in place guidelines • California operations impacted in late March returning to full operations end of April • China returned to full operations mid - March • Malaysia operations impacte
Slide 5: Helping Support the Fight Against COVID-19
| 5 Helping Support the Fight Against COVID - 19 ▪ Twelve COVID - 19 related programs ▪ 7 screening and testing devices ‒ X - Ray, MRI, and Ultrasound ‒ POC COVID - 19 quick test device ‒ POC Sepsis testing device ▪ 2 therapeutic fluid delivery devices ▪ 3 sites supporting ventilator programs ▪ Engi
Slide 6: Roop Lakkaraju, Chief Financial Officer
| 6 Roop Lakkaraju Chief Financial Officer
Slide 7: First Quarter 2020 Overview
| 7 First Quarter 2020 Overview Achieved revenue of $515 million ‒ Against a backdrop of mandatory facility shutdowns and component constraints ‒ Strong demand in Semi - Cap, Medical, and Defense sectors Realized gross margins of 8.4% and earnings per share of $0.22 Maintained cash conversion
Slide 8: Revenue by Mix and Market Sector
| 8 Revenue by Mix and Market Sector For the Three Months Ended Higher - Value Markets Mar. 31 , 2020 Dec. 31 , 2019 Q/Q Mar. 31 , 2019 Y/Y Medical 23% $118 20% $103 15% 17% $103 14% Semi - Cap 16% $83 16% $81 2% 11% $66 25% Aerospace & Defense 23% $119 21% $106 13% 17% $104 15% Industrials 20% $103
Slide 9: First Quarter 2020 Financial Summary (GAAP)
| 9 First Quarter 2020 Financial Summary (GAAP) See APPENDIX 1 for a reconciliation of GAAP to non - GAAP Financial Results For the Three Months Ended (In millions, except EPS) Mar. 31 , 2020 Dec. 31 , 2019 Q/Q Mar. 31 , 2019 Y/Y Net Sales $515 $508 1.3% $603 (15%) GAAP Gross Margin 8.4% 7.3% 110 bp
Slide 10: First Quarter 2020 Financial Summary (Non-GAAP)
| 10 First Quarter 2020 Financial Summary (Non - GAAP) For the Three Months Ended (In millions, except EPS) Mar. 31 , 2020 Dec. 31 , 2019 Q/Q Mar. 31 , 2019 Y/Y Net Sales $515 $508 1.3% $603 (15%) Non - GAAP Gross Margin 8.4% 7.4% 100 bps 8.1% 30 bps Non - GAAP SG&A $31.6 $24.2 30.6% $31.7 (0.3%) No
Slide 11: Cash Flow / Balance Sheet Summary
| 11 Cash (In millions) Mar. 31 , 2020 Dec. 31 , 2019 Mar. 31, 2019 Cash Flows from (used in) Operations $(3) $36 $16 FCF (1) $(16) $27 $6 Cash $412 $364 $395 International $189 $198 $165 US $223 $166 $230 Cash Flow / Balance Sheet Summary For the Three Months Ended (1) Free cash flow (FCF) defined
Slide 12: Working Capital Update
| 12 Working Capital Update Q1 - 18 Q2 - 18 Q3 - 18 Q4 - 18 Q1 - 19 Q2 - 19 Q3 - 19 Q4 - 19 Q1 - 20 Accounts Receivable Days 59 61 64 64 61 54 56 57 56 Contract Asset Days 22 20 22 19 23 23 26 29 28 Inventory Days 50 47 49 46 51 52 56 60 65 Deposits 3 2 4 4 3 3 7 7 7 Accounts Payable Days 60 57 57 6
Slide 13: Capital Allocation Update
| 13 Capital Allocation Update Dividends Quarterly dividend of $0.15 per share totaling $5.5 million paid in January 2020 Recurring quarterly dividend increased by 6.7% to $0.16 per share and paid to shareholders as of March 31, 2020 on April 14, 2020 Recurring quarterly dividends to continue
Slide 14: Jeff Benck, President & Chief Executive Officer
| 14 Jeff Benck President & Chief Executive Officer
Slide 15: End Market Demand Outlook by Sector
| 15 End Market Demand Outlook by Sector Most significant variables in Q2 revenue - operations and supply chain support for demand Medical Semi - Cap Defense Aerospace Industrial Computing/ Telco • Volume remains strong for existing products and new ramps, COVID - 19 related systems and devices shou
Slide 16: Notable New Business Wins Continue
| 16 Notable New Business Wins Continue Medical Portable ultrasound electronics & systems ( mfg.) Automated drug freezer (design) Portable mobile imaging ( process design & mfg.) Semi - Cap Front - end semi - cap in - chamber tool (precision technologies) Semi - cap tool electronic control
Slide 17: Updated "Guideposts"
| 17 Updated “Guideposts” Suspending quarterly guidance due to current environment 2Q Revenue: Expect modest sequential quarterly revenue decline; varied operational impacts as a result of labor and supply chain constraints; timing of government actions pending to permit factories to return to hig
Slide 18: Unchanged: Key Strategic Initiatives
| 18 Unchanged: Key Strategic Initiatives Staying focused on longer term horizon Change the relationship with our customers; differentiate with technology Revenue at the right target margin profile Focus on the Customer Be the best at what we do Effective asset utilization and margin expansi
Slide 19: Appendix
| 19 Appendix
Slide 20: Appendix 1 - Reconciliation of GAAP to non-GAAP Financial Results
| 20 (Amounts in Thousands, Except Per Share Data) – (UNAUDITED) APPENDIX 1 - Reconciliation of GAAP to non - GAAP Financial Results This amount represents the tax impact of the non - GAAP adjustments using the applicable effective tax rates.
Slide 21: Reconciliation of GAAP to Non-GAAP Financial Measures
| 21 (Amounts in Thousands) – (UNAUDITED) APPENDIX 2 - Reconciliation of GAAP to Non - GAAP Financial Measures Three Months Ended Mar. 31 , 2020 Dec. 31 , 2019 Mar. 31, 2019 GAAP Gross Profit $43,361 $37,313 $50,037 Settlement - (773) - Customer insolvency (recovery) - 967 (1,024) Non - GAAP Gross P
Slide 22: Reconciliation of Free Cash Flow
| 22 (Amounts in Thousands) – (UNAUDITED) APPENDIX 3 - Reconciliation of Free Cash Flow Three Months Ended Mar. 31 , 2020 Dec. 31 , 2019 Mar. 31, 2019 Net Cash Provided by (Used in) Operations $(3,109) $35,822 $16,414 Additions to property, plant and equipment and software (12,896) (9,176) (10,074)