Sanmina Corporation · NASDAQ:SANM
Sanmina — Q1 2021 Earnings Presentation
24 slides from Sanmina's earnings presentation, Feb 2, 2021
Slide 1: Q1 FY’21 Results
Q1 FY’21 Results February 2, 2021
Slide 2: Today’s Presenters
Today’s Presenters Jure Sola Kurt Adzema Chairman & CEO EVP & CFO
Slide 3: Safe Harbor Statement
Safe Harbor Statement Certain statements made during this presentation, including the Company's outlook for the second quarter fiscal 2021 financial results, constitute forward-looking statements within the meaning of the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934.
Slide 4: Opening Comments
: ae Opening < > Comments SANMINA Jure Sola ——________
Slide 5: Financial Review
Financial Review Kurt Adzema
Slide 6: Q1’21 Non-GAAP Financial Highlights
Q1’21 Non-GAAP Financial Highlights Revenue: $1.76B, exceeded midpoint of outlook of $1.7B - $1.8B Gross margin: 8.3%, 3rd consecutive quarter above 8% Operating margin: 5.0%, 2nd consecutive quarter of 5% or greater Diluted EPS: $1.02, exceeded outlook of $0.75 - $0.85 6
Slide 7: P&L Performance
P&L Performance ($ in Millions, except per share data) Revenue Non-GAAP Gross Profit / Margin $1,840 $1,875 $156 $1,741 $1,755 $138 $146 $1,591 $1,655 $135 $110 8.1% 8.3% 8.3% 7.5% 6.9% Q1'20 Q2'20 Q3'20 Q4'20 Q4'20 Q1'21 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 (14 Week) (Normalized*) Non-GAAP Operating Incom
Slide 8: Segment Reporting – Revenue and Non-GAAP Gross Margin
Segment Reporting – Revenue and Non-GAAP Gross Margin* ($ in Millions) Integrated Manufacturing Solutions Components, Products and Services $365 $1,544 $1,541 $336 $337 $1,462 $327 $1,300 $1,348 $319 7.2% 7.3% 7.0% 12.4% 12.4% 6.6% 12.0% 5.8% 10.9% 10.6% Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q1'20 Q2'20 Q3'
Slide 9: Strong Balance Sheet
Strong Balance Sheet Cash and cash equivalents: $516 million Debt to cash ratio: 0.7x Liquidity: $1.2 billion Cash flow from operations: $62 million Free cash flow: $51 million Shares repurchased: Approximately 384,000 shares for $9.4 million Well Positioned to Operate in Any Economic En
Slide 10: Balance Sheet Metrics
Balance Sheet Metrics ($ in Millions) Cash and Cash Equivalents Inventory $ / Turns $1,115 $1,117 $844 $884 $884 $861 $819 7.8x 7.3x 7.7x 6.9x 6.9x $481 $516 $431 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2’20 and Q3’20 include $650 million of borrowings on our cash flow revolver,
Slide 11: Q2’21 Outlook
Q2’21 Outlook* The following outlook for the second fiscal quarter ended April 3, 2021. These statements are forward-looking and actual Overall customer demand relatively stable results may differ materially. Typical seasonality Revenue: $1.65B - $1.75B Uncertainty related to supply chain cons
Slide 12: CEO Remarks
w CEO — Lad > Remarks SANMINA Jure Sola ——________
Slide 13: Q1’21 Key Drivers
Q1’21 Key Drivers Focused on employee safety Delivered superior customer satisfaction Drove operating efficiencies and better mix Generated free cash flow 13
Slide 14: Revenue By End-Market
Revenue By End-Market Communications Networks & Cloud Medical Infrastructure $ in Millions Q1’20 Q2’20 Q3’20 Q4’20* Q1’21 41% Communications Networks Communications Networks $733 $624 $717 $759 $723 Cloud & Cloud Infrastructure Solutions Industrial/Medical/ $1,107 $967 $938 $1,116 $1,033 Q1’21 Defen
Slide 15: Q2’21 End-Market Outlook - Stable
Q2’21 End-Market Outlook - Stable Mission Critical, High-Complexity, Heavily Regulated 15
Slide 16: Management Priorities
Management Priorities Provide industry leading end-to-end solutions, technology components and products for our key markets Build strong customer partnerships Drive sustainable profitable growth with financial discipline Deliver operating margin growth and strong cash flow Unlock the total
Slide 17: Summary
Summary Q1’21 – Revenue: $1.76B, exceeded the midpoint of outlook – Non-GAAP operating margin: 5.0% – Non-GAAP diluted EPS: $1.02, exceeded outlook – Free cash flow: $51M – Non-GAAP pre-tax ROIC: 28.4% Q2’21 – Revenue outlook of $1.65B - $1.75B – Non-GAAP diluted EPS outlook of $0.76- $0.86 – Re
Slide 18: Consolidated Financial Statements Reconciliation of GAAP vs. Non-GAAP
Consolidated Financial Statements Reconciliation of GAAP vs. Non-GAAP Quarter Ended January 2, 2021
Slide 19: Condensed Consolidated Balance Sheets
Sanmina Corporation Condensed Consolidated Balance Sheets (in thousands) (GAAP) January 2, October 3, 2021 2020 (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 516,030 $ 480,526 Accounts receivable, net 1,108,472 1,043,334 Contract assets 350,049 396,583 Inventories 819,474 861,281 Pr
Slide 20: Condensed Consolidated Statements of Income
Sanmina Corporation Condensed Consolidated Statements of Income (in thousands, except per share amounts) (GAAP) (Unaudited) Three Months Ended Jan. 2, Dec. 28, 2021 2019 Net sales $ 1,755,249 $ 1,840,171 Cost of sales 1,614,014 1,705,289 Gross profit 141,235 134,882 Operating expenses: Selling, gene
Slide 21: Reconciliation of GAAP to Non-GAAP Measures
Sanmina Corporation Reconciliation of GAAP to Non-GAAP Measures (in thousands, except per share amounts) (Unaudited) Three Month Periods Q1'21 Q4'20 Q3'20 Q2'20 Q1'20 GAAP Gross Profit $ 141,235 $ 151,931 $ 131,473 $ 107,421 $ 134,882 GAAP gross margin 8.0% 8.1% 7.9% 6.8% 7.3% Adjustments Stock comp
Slide 22: Pre-Tax Return on Invested Capital (ROIC)
Sanmina Corporation Pre-Tax Return on Invested Capital (ROIC) (in thousands) Q1 FY21 Pre-tax Return on Invested Capital (ROIC) GAAP operating income $ 75,559 x 4.0 Annualized GAAP operating income 302,236 Average invested capital (1) ÷ 1,229,805 GAAP pre-tax ROIC 24.6% Non-GAAP operating income $ 87
Slide 23: Condensed Consolidated Cash Flow
Sanmina Corporation Condensed Consolidated Cash Flow (in thousands) (Unaudited) Three Month Periods Q1'21 Q1'20 GAAP Net Income $ 48,021 $ 38,345 Depreciation and amortization 27,635 28,735 Other, net 11,556 9,589 Net change in net working capital (25,401) (55,498) Cash provided by operating activit
Slide 24: Sanmina
_ SANMINA ——________