Jabil Circuit Posts Record Revenue; Earnings Per Share Increases 42 Percent - 1st qtr financial report - Company Financial Information

Edge: Work-Group Computing Report, Dec 20, 1999

Jabil Circuit, Inc. (NYSE:JBL), electronics manufacturing services provider, Thursday reported record revenue for the first quarter of fiscal 2000, ended November 30, 1999. Revenue for the quarter increased 39 percent to $690 million compared to $495 million for the same period of fiscal 1999.

Jabil's first quarter of fiscal 2000 net income increased 56 percent to $31.2 million, excluding a one-time acquisition-related charge of $5.2 million, compared with $20 million and earnings per share increased 42 percent to $0.34 per diluted share, compared to $0.24 for the first quarter of fiscal 1999.

Gross profit for fiscal 2000 first quarter increased 34 percent to $73.4 million or 10.6 percent of revenue compared to $54.7 million or 11 percent of revenue for the corresponding quarter of fiscal 1999.

Operating income for the first fiscal quarter of 2000 increased 39 percent to $44.6 million or 6.5 percent of revenue compared to $32 million or 6.5 percent of revenue for the first fiscal quarter of 1999.

Jabil Circuit President Timothy L. Main said, "We are pleased with the results for our fiscal first quarter and with our positioning for an outstanding fiscal 2000. Our people continued to deliver strong operational performance during the quarter as we executed a challenging growth plan and incorporated two new acquisitions into the Company." Income Statement -- Sequential Trend Highlights

The following sequential results are presented in non-pooled format in order to reflect the actual growth of the company during this time period. The results of operations and balance sheet statements attached with this release contain pooled results.

-- First quarter revenue grew by 29 percent over the prior quarter.

-- Operating income increased from $37.9 million, to $44.6 million or 6.5 percent of revenue.

-- Net income after taxes was $31.2 million or 4.5 percent of revenue, as compared to $26.2 million or 4.9 percent in the prior sequential quarter.

-- Earnings per share for the quarter were $0.34 on an average 91,389,000 shares during the period, fully diluted. This excludes the impact of an acquisition related charge of approximately $5 million, or $0.05 EPS.

Balance Sheet Review -- Sequential Trend Highlights

-- Accounts receivables increased by $90 million to $319 million in the first quarter as compared to $228 million in the fourth quarter. Calculated DSO was 42 days, while collection experience was 38 days. This compares to DSO and collection experience of 38 days in the prior quarter.

-- Inventories increased by $108 million in the quarter to $299 million as compared to $191 million as of the end of August. Calculated inventory turns were eight, compared to 10 turns in the previous quarter. Inventory balances include approximately $25 million in inventory relating to the GET/JGS acquisitions. Overall inventory balances are somewhat higher as the company prepares for significant growth in several segment areas in the second fiscal quarter. On a forward basis, inventory turns are approximately 10 as the company enters into the second quarter.

-- The Company's debt to capitalization ratio was 7 percent at the end of the quarter.

-- For the quarter, average return on assets was 11.5 percent (excluding one-time, acquisition-related charge.)

-- Fiscal first quarter average return on equity was 21 percent (excluding one-time, acquisition-related charge.)

Business Update Facilities

Guadalajara, Mexico operation has expanded and now has a second building on the campus bringing total square footage to approximately 400,000 square feet.

In January the company will move into a new 170,000 sq. ft. facility in Boise, Idaho, replacing the smaller leased facility on Hewlett Packard's campus in that location.

The company announced a new greenfield site in Hungary. The Company said it is in the final stages of site acquisition and plan to bring this new operation on line in the early fall of 2000. The Fiscal Year Ahead

Main commented, "We are gratified with the effort and overall results of our employees during this period of unprecedented growth and challenge. We are concurrently ramping new customers and programs across all of our facilities. We are very pleased to see continued strong organic growth and are pleased to have immediate contributions from our two recent acquisitions. We are also encouraged by our diversified business model of over 30 meaningful customers as we enter this fiscal year, giving the Company numerous opportunities for continued growth."

              JABIL CIRCUIT, INC. AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS
                         (In thousands)

                                        August 31,     November 30,
                                           1999            1999
                                                        (Unaudited)
ASSETS
Current assets
  Cash and cash equivalents            $   125,949    $    48,124
  Short-term investments                 27,176           --
  Accounts receivable - Net                261,078        318,647
  Inventories                              217,840        299,477
  Prepaid expenses and other
current assets                              14,794         22,765
  Deferred income taxes                     13,896         13,500

     Total current assets                  660,733        702,513

Property, plant and equipment, net         353,522        396,295
Other assets                                20,786         34,258
                                       $ 1,035,041    $ 1,133,066

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
  Current installments of
long term debt                         $     9,610    $     8,333
  Short-term debt                           21,501          1,588
  Accounts payable                         300,093        384,571
  Accrued expenses                          59,186         62,648
  Income taxes payable                      20,511         15,141

     Total current liabilities             410,901        472,281

Long term debt, less current installments   34,712         33,333
Deferred income taxes                       10,199         21,276
Deferred grant revenue                       1,798          3,731

     Total liabilities                     457,610        530,621

Stockholders' equity
  Common stock                                  87             87
  Additional paid in capital               296,396        295,247
  Retained earnings                        281,166        307,654
  Cumulative translation adjustment           (218)          (543)

     Total stockholders' equity            577,431        602,445
                                       $ 1,035,041    $ 1,133,066

              JABIL CIRCUIT, INC. AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF OPERATIONS
            (In thousands, except for per share data)
                           (Unaudited)

                                          Three months ended
                                              November 30,
                                           1998        1999

Net revenue                             $ 495,115   $ 689,822
  Cost of revenue                         440,420     616,435

Gross profit                               54,695      73,387

Operating expenses:
  Selling, general and administrative      20,825      27,051
  Research and development                  1,457       1,182
  Amortization of intangibles                 357         599
  Acquisition-related charge                 --         5,153
Operating income                           32,056      39,402

  Interest (income)/expense, net            1,600        (615)

Income before income taxes                 30,456      40,017

  Income tax expense                       10,440      13,529

Net income                              $  20,016   $  26,488

Earnings per share:
 Basic                                  $    0.25   $    0.30
 Diluted                                $    0.24   $    0.29

Common shares used in the
 calculations of earnings
 per share:
  Basic                                    79,689      87,410
  Diluted                                  82,778      91,389

              JABIL CIRCUIT, INC. AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF OPERATIONS
    Pro-forma, excluding impact of acquisition-related charge
            (In thousands, except for per share data)
                           (Unaudited)

                                          Three months ended
                                              November 30,
                                           1998        1999

Net revenue                             $ 495,115   $ 689,822
  Cost of revenue                         440,420     616,435

Gross profit                               54,695      73,387

Operating expenses:
  Selling, general and administrative      20,825      27,051
  Research and development                  1,457       1,182
  Amortization of intangibles                 357         599
  Acquisition-related charge                   --          --
Operating income                           32,056      44,555

  Interest (income)/expense, net            1,600        (615)

Income before income taxes                 30,456      45,170

  Income tax expense                       10,440      14,003

Net income                              $  20,016   $  31,167

Earnings per share:
 Basic                                  $    0.25   $    0.36
 Diluted                                $    0.24   $    0.34

Common shares used in the
 calculations of earnings per share:
  Basic                                    79,689      87,410
  Diluted                                  82,778      91,389

              JABIL CIRCUIT, INC. AND SUBSIDIARIES
         PRO-FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
                FISCAL YEAR ENDED AUGUST 31, 1999
                      Restated for Pooling
            (In thousands, except for per share data)
                           (Unaudited)

                Q1         Q2        Q3(a)      Q4(a)       FY99

Net revenue$ 495,115  $ 558,703  $ 582,238  $ 602,335  $ 2,238,391
Gross profit  54,695     60,102     63,821     66,970      245,588

 Selling,
  general and
administrative20,825     22,452     22,586     25,836       91,699
 Research and
  development  1,457      1,432      1,387      1,587        5,863
 Amortization of
  intangibles    357        294        287        287        1,225
Operating income
 (loss)       32,056     35,924     39,561     39,260      146,801

Interest
 (income)/
 expense, net  1,600      1,892        (26)      (892)       2,574

Income (loss)
 before income
 taxes        30,456     34,032     39,587     40,152      144,227

  Income tax
   expense
(benefit)     10,440     11,778     13,933     14,081       50,232

Net income  $ 20,016   $ 22,254   $ 25,654   $ 26,071     $ 93,995

Earnings per
 share:
  Basic     $   0.25   $   0.28   $   0.30   $   0.30     $   1.13
  Diluted   $   0.24   $   0.27   $   0.28   $   0.29     $   1.08

Common shares
 used in the
 calculations
 of earnings
 per share:
  Basic       79,689     79,972     86,565     87,281       83,377
  Diluted     82,778     83,503     90,449     91,078       86,952

(a) Excludes approximately $0.04 and $0.06 non-recurring charges
in Q3 and Q4, respectively, recorded by GET in fiscal 1999.