Slide 1: 2019 Fourth Quarter Earnings & Investor Briefing
2019 FOURTH QUARTER EARNINGS & INVESTOR BRIEFING September 24, 2019
Slide 2: Today's Agenda
TODAY’S AGENDA ADAM BERRY, IR Opening Remarks MIKE DASTOOR, CFO Q4 & FY19 Results MARK MONDELLO, CEO Business Update MIKE DASTOOR, CFO Financial Update Q&A
Slide 3: Forward Looking Statement
FORWARD LOOKING STATEMENT Forward Looking Statements: The presentation contains forward-looking statements, including those regarding our anticipated financial results for our fourth quarter 2019; our guidance for future financial performance in our first quarter of fiscal year 2020 (including, net
Slide 4: Fourth Quarter 2019 Results
FOURTH QUARTER 2019 RESULTS Mike Dastoor September 24, 2019
Slide 5: Fourth Quarter and Fiscal Year 2019 Income Highlights
FOURTH QUARTER AND FISCAL YEAR 2019 INCOME HIGHLIGHTS THREE MONTHS ENDED FISCAL YEAR ENDED AUGUST 31, AUGUST 31, (In millions, except for per share data) 2019 2018 2019 2018 Net revenue $6,573 $5,772 $25,282 $22,095 U.S. GAAP operating income $190 $154 $701 $542 U.S. GAAP net income (loss) $53 ($57)
Slide 6: Fourth Quarter Segment Results
FOURTH QUARTER SEGMENT RESULTS DIVERSIFIED MANUFACTURING SERVICES (DMS) Net Revenue Increase of 2% Core margin* (non-GAAP) of 2.9% DMS ELECTRONICS MANUFACTURING SERVICES (EMS) 37% $6.6B Net Revenue Increase of 23% Core margin* (non-GAAP) of 4.3% REVENUE EMS 63% TOTAL COMPANY Net Revenue In
Slide 7: FY19 Segment Results
FY19 SEGMENT RESULTS DIVERSIFIED MANUFACTURING SERVICES (DMS) Net Revenue flat Core margin* (non-GAAP) of 4.0% ELECTRONICS MANUFACTURING SERVICES (EMS) DMS Net Revenue Increase of 26% $25.3B 39% Core margin* (non-GAAP) of 3.1% REVENUE EMS 61% TOTAL COMPANY Net Revenue Increase of 14% Cor
Slide 8: Cash Flow Highlights
CASH FLOW HIGHLIGHTS FISCAL YEAR ENDED AUGUST 31, (In millions) 2019 Adjusted cash flow from operations (non-GAAP) 2 $1,290 Net capital expenditures1 $787 Adjusted free cash flow (non-GAAP)2 $503 Core EBITDA (non-GAAP)1 $1,617 1 See U.S. GAAP to non-GAAP reconciliation in appendix and U.S. GAAP to n
Slide 9: Business Update
BUSINESS UPDATE Mark Mondello CEO September 24, 2019
Slide 10: Caring is Core to Our Jabil Values
‘CARING is CORE’ to Our JABIL VALUES Diversity of PEOPLE Diversity of THOUGHT Diversity of SOLUTIONS PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 10
Slide 11: FY19 Results
FY19 RESULTS NET REVENUE CORE OPERATING CORE EPS ADJ. FREE MARGIN CASH FLOW $ 25.3 BILLION 3.5% $ 2.98 $ 503 MILLION See U.S. GAAP to non-GAAP definitions and reconciliations located at https://investors.jabil.com/ PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 11
Slide 12: What We're Doing Is Working
WHAT WE’RE DOING IS WORKING REVENUE CORE OP INCOME CORE EPS (In billions) (In millions) 11% 12% 17% CAGR CAGR CAGR $25.3 $877 $22.1 $2.98 $768 $2.62 $18.4 $19.1 $667 $630 $2.11 $1.86 FY16 FY17 FY18 FY19 FY16 FY17 FY18 FY19 FY16 FY17 FY18 FY19 See U.S. GAAP to non-GAAP definitions and reconciliations
Slide 13: Jabil FY20: Our Strategy, Our Path, Our Outlook
JABIL FY20 OUR STRATEGY OUR PATH OUR OUTLOOK PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 13
Slide 14: Optimize, Execute, Deliver
MANAGEMENT ATTENTION OPTIMIZE OPTIMIZE EXECUTE Execution and Solutions DELIVER Network and Asset Operational Financial Efficiency Excellence Commitments PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 14
Slide 15: Optimize: Network and Asset Efficiency
OPTIMIZE NETWORK AND ASSET EFFICIENCY PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 15
Slide 16: Execute: Factory of the Future
EXECUTE FACTORY OF THE FUTURE PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 16
Slide 17: Deliver: Management's Outlook for FY20
DELIVER NET REVENUE CORE OP CORE EPS ADJ. FREE CASH MARGIN FLOW ~ $ 26 3.7% $ 3.45 $ 500+ BILLION MILLION MANAGEMENT’S OUTLOOK FOR FY20 See U.S. GAAP to non-GAAP definitions located at https://investors.jabil.com/ PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 17
Slide 18: Optimize, Execute, Deliver: Leadership
MANAGEMENT ATTENTION LEADERSHIP OPTIMIZE OPTIMIZE EXECUTE DELIVER World Class Team Execution and and Structure Solutions Network and Asset Operational Financial Efficiency Excellence Commitments PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 18
Slide 19: Updated Outlook
UPDATED OUTLOOK CORE OP CORE OP CORE (In millions, except for per share data) NET REVENUE INCOME MARGIN EPS FY19 RESULTS $25,300 M $877 M 3.5% $2.98 FY20 OUTLOOK ~ $26,000 M $960 M 3.7% $3.45 FY21 OUTLOOK ~ $27,000 M $1,080 M 4.0% $4.00 See U.S. GAAP to non-GAAP definitions located at https://invest
Slide 20: Structure, Team, Culture
STRUCTURE, TEAM, CULTURE ENGINEERED ENTERPRISE & JABIL JABIL JABIL SOLUTIONS GROUP INFRASTRUCTURE PACKAGING GREEN POINT HEALTHCARE Automotive Semi-Cap Home Care Mobility Consumer Health Energy & Industrial 5G Wireless Personal Care Edge Devices Diagnostics Defense & Aerospace Cloud Professional Care
Slide 21: Our Most Important Asset
OUR MOST IMPORTANT ASSET PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 21
Slide 22: Financial Update
FINANCIAL UPDATE Mike Dastoor CFO September 24, 2019
Slide 23: FY20 Priorities
FY20 PRIORITIES EXPAND INCREASE GENERATE OPERATING MARGINS EARNINGS PER SHARE STRONG CASH FLOWS ALIGNED & FOCUSED ON DRIVING LONG-TERM VALUE CREATION PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 23
Slide 24: FY20 End-Markets
FY20 END-MARKETS DIVERSIFIED MANUFACTURING ELECTRONICS MANUFACTURING $ in billions FY19 FY20E $ in billions FY19 FY20E Automotive & Semi-Cap $1.9 $2.4 Mobility $3.3 $3.1 Digital Print & Retail $2.4 $2.6 Healthcare & Packaging $3.2 $4.0 Industrial & Energy $2.5 $2.7 Wireless / 5G & Cloud $4.3 $4.3 Ed
Slide 25: Positioned to Deliver Operating Margin Expansion
POSITIONED TO DELIVER OPERATING MARGIN EXPANSION Drivers of Core Operating Y/Y Margin Expansion Income & Margin ($ in millions) • Improved business mix & operational 12% CAGR $960 efficiency $877 $768 • Optimization benefit 3.7% 3.5% 3.5% FY18 FY19 FY20E Core operating income Core Margin PUBLIC | ©J
Slide 26: Disciplined Investment
DISCIPLINED INVESTMENT FY20 Net Capex FY20 Growth Investment ($ millions) PACKAGING RETAIL Net Capex FY20E Maintenance Investment $550 • Replacement $450 AUTOMOTIVE Engineering & Innovation $100 $250M • HEALTHCARE Growth Investment $250 Company Total $800 ENERGY & INDUSTRIAL 5G WIRELESS PUBLIC | ©Ja
Slide 27: FY20 Free Cash Flow Generation
FY20 FREE CASH FLOW GENERATION Drivers of Future Adjusted FCF Free Cash Flow ($ millions) $503 $500 + • Earnings expansion $248 • Working capital efficiencies • Disciplined investment FY18 FY19 FY20E PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. See U.S. GAAP to non-GAAP definitions and reconcilia
Slide 28: FY20 & FY21 Capital Allocation Framework
FY20 & FY21 CAPITAL ALLOCATION FRAMEWORK Cash flow from operations Capex ~ 60% Free Cash Flow Debt Optimization Share Repurchases & & M&A Dividends ~ 40% 10% ~ 60% VALUE CREATION FOR JABIL SHAREHOLDERS PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 28
Slide 29: First Quarter FY20 Guidance
FIRST QUARTER FY20 GUIDANCE Segment Revenue Guidance Q1 FY20E YoY Change Diversified Manufacturing Services $3.1B Increase ~3% Electronics Manufacturing Services $3.9B Increase ~11% Consolidated Guidance Q1 FY20E Net revenue $6.65B - $7.35B U.S. GAAP operating income $128M - $206M U.S. GAAP dilu
Slide 30: FY20 & FY21 Outlook Assumptions
FY20 & FY21 OUTLOOK ASSUMPTIONS Semi-Cap normalizes in summer of CY20 Increase in mobility volumes in FY21 Double-digit growth in Healthcare & Packaging No material contributions from future M&A Stable economic environment PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 30
Slide 31: FY20 & FY21 Outlook
FY20 & FY21 OUTLOOK CORE OP INCOME & CORE MARGIN CORE EPS ADJ. FREE CASH FLOW (In millions) (In millions) $1,080 $960 $877 4.0% $768 $600 + 3.7% $4.00 3.5% 3.5% $3.45 $503 $500 + $2.98 $2.62 $248 FY18 FY19 FY20E FY21E FY18 FY19 FY20E FY21E FY18 FY19 FY20E FY21E FY21 OUTLOOK $4 $600+ 4% CORE OPERATIN
Slide 32: Q&A
Q&A MARK MONDELLO MIKE DASTOOR CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER
Slide 33: Appendix: GAAP to Non-GAAP Reconciliations
APPENDIX GAAP to Non-GAAP Reconciliations PUBLIC | ©Jabil Inc. 2019. All Rights Reserved. 33
Slide 34: Operating Income, EBITDA and Net Income Non-GAAP Reconciliation
JABIL INC. AND SUBSIDIARIES OPERATING INCOME, EBITDA and NET INCOME NON-GAAP RECONCILIATION (In thousands, except for per share data) (Unaudited) Three months ended Fiscal year ended August 31, 2019 August 31, 2018 August 31, 2019 August 31, 2018 Operating income (U.S. GAAP) $ 189,745 $ 153,896 $ 70