Slide 1: Benchmark Electronics Q2-22 Earnings Results
Benchmark Electronics Q2-22 Earnings Results August 3, 2022
Slide 2: Forward-Looking Statements
Forward-Looking 2022 Statements This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are identified as any statement that does
Slide 3: Q2-22 Overview
Q2-22 Overview Achieved 34% year-over-year revenue growth to $728 million - Driven by strength from Industrials, Medical and High Performance Computing Realized GAAP and non-GAAP gross margin of 8.1% and operating margin of 3.1% Excluding supply chain premiums, revenue grew 19% year-over-year, non-G
Slide 4: Roop Lakkaraju, Chief Financial Officer
Roop Lakkaraju Chief Financial Officer
Slide 5: Second Quarter Revenue by Market Sector
Second Quarter Revenue by Market Sector Q2-22 June 30, 2022 Revenue by Mix and Market Sector Mar. 31, 2022 June 30, 2021 For the Three Months Ended Dollars in Millions Higher-Value Markets Mix % Revenue Mix % Revenue Q/Q Growth Mix % Revenue Y/Y Growth Medical 23% $166 18% $117 42% 20% $109 53% Semi
Slide 6: Effects of Supply Chain Premiums
Effects of Supply Chain Premiums Supply chain premiums are excess component costs paid by customers to secure available supply Results in pass-through revenue with no margin Dilutes gross and operating margin Magnitude of the premiums are temporary in nature No gross or operating profit impact No GA
Slide 7: Second Quarter 2022 Financial Summary
Second Quarter 2022 Financial Summary (In millions, except EPS) June 30, 2022 Mar. 31, 2022 Q/Q June 30, 2021 Y/Y Net Sales $728 $636 14% $545 34% GAAP Gross Margin 8.1% 9.1% (100) bps 8.8% (70) bps GAAP SG&A $35.8 $36.3 (1%) $34.0 5% GAAP Operating Margin 3.1% 2.4% 70 bps 2.0% 110 bps GAAP Diluted
Slide 8: Non-GAAP Financial Summary Excluding Supply Chain Premiums
Non-GAAP Financial Summary Excluding Supply Chain Premiums (In millions, except EPS) Gross Margin without pass-through revenue
Slide 9: Trended Non-GAAP Return on Invested Capital
Trended Non-GAAP Return on Invested Capital * ROIC grew by 50% between Q1:21 and Q2:22 Fueled by growth of 44% in revenue and 97% in operating income over the same period Targeting 10% or better ROIC exiting fiscal 2022 * Non-GAAP ROIC = (Non-GAAP TTM income from operations + Stock-based compensatio
Slide 10: Cash Conversion Cycle Update
Cash Conversion Cycle Update Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Accounts Receivable Days 48 49 51 54 55 Contract Asset Days 26 25 22 24 22 Inventory Days 75 83 82 95 90 Accounts Payable Days (69) (70) (67) (71) (67) Advance Payments from Customers Days (16) (16) (19) (20) (23) Cash Conversion Cycle 64 71
Slide 11: Liquidity and Capital Resources
Liquidity and Capital Resources (1) Free cash flow (used) (FCF) defined as net cash provided by (used in) operations less capex Debt Structure (In millions) June 30, 2022 Senior Secured Term Loan $131 Revolving Credit Facility Drawn Amount $135 Strong balance sheet and available debt facilities Stra
Slide 12: Capital Allocation Update
Capital Allocation Update Dividends Quarterly dividend of $0.165 per share totaling $5.8 million paid in April 2022 Recurring quarterly dividend of $0.165 per share paid to shareholders as of June 30, 2022 on July 14, 2022 Recurring quarterly dividends to continue until further notice Share Repurcha
Slide 13: Third Quarter 2022 Guidance
Third Quarter 2022 Guidance * This guidance takes into consideration all known constraints for the quarter and assumes no further significant interruptions to our supply base, operations or customers. Guidance also assumes no material changes to end market conditions and our operations due to COVID.
Slide 14: 2022 Outlook - Jeff Benck, CEO
2022 Outlook Jeff Benck - CEO Benchmark. 14
Slide 15: Q2-22 New Business Wins
Q2-22 New Business Wins Medical DNA Sequencing Device for Cancer Diag. (Design & Manufacturing) Blood Safety System (Design) Smart Wound Healing Platform (Design) Semi-Cap Automated Vacuum Curing (Manufacturing) Atomic Layer Deposition Platform (Manufacturing) Lithography Tool build to print (Manufa
Slide 16: Q3-22 Sector Outlook
Q3-22 Sector Outlook Medical FY2022 Revenue Outlook Semi-Cap A&D Industrials Computing Telco FY2022 Sector Revenue Drivers Strong year over year growth fueled by strength in existing programs and new ramps Semi-cap growth enabling record revenue levels Demand strength through second half 2022 Both h
Slide 17: 2022 Mid-Term Target Model Progression
2022 Mid-Term Target Model Progression 2022 Mid-Term Model Revenue growth above target, approaching all-time record level Non-GAAP gross margin below target due to supply chain premium pass-through at zero margin Operating expenses within target range Non-GAAP Operating Margin impacted by supply cha
Slide 18: Highlights and 2022 Outlook
Highlights and 2022 Outlook Strong demand across market sectors Executing through Semi-cap “super-cycle” - Chips Act bill provides continued fab investment Industrial outperformed our expectations as we secured supply to support upside New Medical product ramps in flight and secular strength within
Slide 19: Appendix
Appendix Benchmark. 19
Slide 20: Appendix 1 - Reconciliation of GAAP to non-GAAP Financial Results
(Amounts in Thousands, Except Per Share Data) – (UNAUDITED) APPENDIX 1 - Reconciliation of GAAP to non-GAAP Financial Results Three Months Ended June 30, Mar 31, June 30, 2022 2022 2021 Income from operations (GAAP) $ 22,432 $ 15,407 $ 10,699 Amortization of intangible assets 1,592 1,609 1,599 Restr
Slide 21: Appendix - Reconciliation of Supply Chain Premiums
(Amounts in Millions) – (UNAUDITED) APPENDIX 2 - Reconciliation of Supply Chain Premiums Three Months Ended June 30, Mar 31, Dec 31, Sept 30, June 30, Mar 31, 2022 2022 2021 2021 2021 2021 Sales (GAAP) $ 728 $ 636 $ 633 $ 572 $ 545 $ 506 Adjustment for supply chain premiums (91) (57) (41) (26) (10)