(Mark one)
|
|
[x]
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
[ ]
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
Delaware
|
|
77-0228183
|
|
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
|
|
incorporation or organization)
|
|
Identification Number)
|
|
|
|
|
|
|
|
2700 N. First St., San Jose, CA
|
|
95134
|
|
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
Large Accelerated Filer
|
[X]
|
Accelerated filer [ ]
|
Non-accelerated filer [ ]
|
Smaller reporting company [ ]
|
|
|
|
|
Emerging growth company [ ]
|
|
|
Page
|
|
|
|
Item 1.
|
||
|
||
|
||
|
||
|
||
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 6.
|
||
|
|
As of
|
||||||
|
June 30,
2018 |
|
September 30,
2017 |
||||
|
(Unaudited)
|
||||||
|
(In thousands)
|
||||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
404,777
|
|
|
$
|
406,661
|
|
Accounts receivable, net of allowances of $11,643 and $14,334 as of June 30, 2018 and September 30, 2017, respectively
|
1,153,930
|
|
|
1,110,334
|
|
||
Inventories
|
1,187,006
|
|
|
1,051,669
|
|
||
Prepaid expenses and other current assets
|
48,279
|
|
|
47,586
|
|
||
Total current assets
|
2,793,992
|
|
|
2,616,250
|
|
||
Property, plant and equipment, net
|
635,733
|
|
|
640,275
|
|
||
Deferred tax assets
|
345,780
|
|
|
476,554
|
|
||
Other
|
117,023
|
|
|
114,284
|
|
||
Total assets
|
$
|
3,892,528
|
|
|
$
|
3,847,363
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
1,348,917
|
|
|
$
|
1,280,106
|
|
Accrued liabilities
|
145,954
|
|
|
116,582
|
|
||
Accrued payroll and related benefits
|
109,155
|
|
|
130,939
|
|
||
Short-term debt, including current portion of long-term debt
|
611,280
|
|
|
88,416
|
|
||
Total current liabilities
|
2,215,306
|
|
|
1,616,043
|
|
||
Long-term liabilities:
|
|
|
|
||||
Long-term debt
|
14,562
|
|
|
391,447
|
|
||
Other
|
185,904
|
|
|
192,189
|
|
||
Total long-term liabilities
|
200,466
|
|
|
583,636
|
|
||
Contingencies (Note 6)
|
|
|
|
||||
Stockholders' equity
|
1,476,756
|
|
|
1,647,684
|
|
||
Total liabilities and stockholders' equity
|
$
|
3,892,528
|
|
|
$
|
3,847,363
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(Unaudited)
|
||||||||||||||
|
(In thousands, except per share data)
|
||||||||||||||
Net sales
|
$
|
1,813,366
|
|
|
$
|
1,711,377
|
|
|
$
|
5,233,795
|
|
|
$
|
5,113,616
|
|
Cost of sales
|
1,694,830
|
|
|
1,580,689
|
|
|
4,891,095
|
|
|
4,717,556
|
|
||||
Gross profit
|
118,536
|
|
|
130,688
|
|
|
342,700
|
|
|
396,060
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative
|
61,421
|
|
|
58,708
|
|
|
190,408
|
|
|
186,236
|
|
||||
Research and development
|
8,144
|
|
|
8,394
|
|
|
23,980
|
|
|
25,002
|
|
||||
Restructuring costs (recovery)
|
1,021
|
|
|
(3,908
|
)
|
|
15,972
|
|
|
121
|
|
||||
Other
|
890
|
|
|
918
|
|
|
2,718
|
|
|
1,303
|
|
||||
Total operating expenses
|
71,476
|
|
|
64,112
|
|
|
233,078
|
|
|
212,662
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating income
|
47,060
|
|
|
66,576
|
|
|
109,622
|
|
|
183,398
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Interest income
|
492
|
|
|
219
|
|
|
1,064
|
|
|
658
|
|
||||
Interest expense
|
(7,284
|
)
|
|
(5,503
|
)
|
|
(20,324
|
)
|
|
(16,256
|
)
|
||||
Other income, net
|
1,000
|
|
|
952
|
|
|
3,747
|
|
|
6,021
|
|
||||
Interest and other, net
|
(5,792
|
)
|
|
(4,332
|
)
|
|
(15,513
|
)
|
|
(9,577
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Income before income taxes
|
41,268
|
|
|
62,244
|
|
|
94,109
|
|
|
173,821
|
|
||||
Provision for income taxes
|
7,305
|
|
|
25,840
|
|
|
190,424
|
|
|
60,836
|
|
||||
Net income (loss)
|
$
|
33,963
|
|
|
$
|
36,404
|
|
|
$
|
(96,315
|
)
|
|
$
|
112,985
|
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.49
|
|
|
$
|
0.48
|
|
|
$
|
(1.37
|
)
|
|
$
|
1.52
|
|
Diluted
|
$
|
0.47
|
|
|
$
|
0.47
|
|
|
$
|
(1.37
|
)
|
|
$
|
1.45
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares used in computing per share amounts:
|
|
|
|
|
|
|
|
||||||||
Basic
|
68,907
|
|
|
75,332
|
|
|
70,366
|
|
|
74,548
|
|
||||
Diluted
|
72,053
|
|
|
78,241
|
|
|
70,366
|
|
|
77,917
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(Unaudited)
|
||||||||||||||
|
(In thousands)
|
||||||||||||||
Net income (loss)
|
$
|
33,963
|
|
|
$
|
36,404
|
|
|
$
|
(96,315
|
)
|
|
$
|
112,985
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
||||||||
Change in foreign currency translation adjustments
|
(1,024
|
)
|
|
176
|
|
|
(470
|
)
|
|
(368
|
)
|
||||
Derivative financial instruments:
|
|
|
|
|
|
|
|
||||||||
Change in net unrealized amount
|
(3,462
|
)
|
|
514
|
|
|
(2,009
|
)
|
|
(861
|
)
|
||||
Amount reclassified into net income
|
3,027
|
|
|
(497
|
)
|
|
1,685
|
|
|
969
|
|
||||
Defined benefit plans:
|
|
|
|
|
|
|
|
||||||||
Changes in unrecognized net actuarial losses and unrecognized transition costs
|
606
|
|
|
(550
|
)
|
|
(87
|
)
|
|
680
|
|
||||
Amortization of actuarial losses and transition costs
|
193
|
|
|
482
|
|
|
692
|
|
|
1,648
|
|
||||
Total other comprehensive income (loss)
|
(660
|
)
|
|
125
|
|
|
(189
|
)
|
|
2,068
|
|
||||
Comprehensive income (loss)
|
$
|
33,303
|
|
|
$
|
36,529
|
|
|
$
|
(96,504
|
)
|
|
$
|
115,053
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Nine Months Ended
|
||||||
|
June 30,
2018 |
|
July 1,
2017 |
||||
|
(Unaudited)
|
||||||
|
(In thousands)
|
||||||
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:
|
|
|
|
||||
Net income (loss)
|
$
|
(96,315
|
)
|
|
$
|
112,985
|
|
Adjustments to reconcile net income (loss) to cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
89,134
|
|
|
87,520
|
|
||
Stock-based compensation expense
|
28,698
|
|
|
26,908
|
|
||
Deferred income taxes
|
174,060
|
|
|
30,680
|
|
||
Other, net
|
(881
|
)
|
|
(459
|
)
|
||
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
||||
Accounts receivable
|
(44,995
|
)
|
|
(62,681
|
)
|
||
Inventories
|
(137,036
|
)
|
|
(100,583
|
)
|
||
Prepaid expenses and other assets
|
359
|
|
|
10,912
|
|
||
Accounts payable
|
87,070
|
|
|
112,883
|
|
||
Accrued liabilities
|
(4,214
|
)
|
|
(16,496
|
)
|
||
Cash provided by operating activities
|
95,880
|
|
|
201,669
|
|
||
|
|
|
|
||||
CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES:
|
|
|
|
||||
Purchases of property, plant and equipment
|
(97,468
|
)
|
|
(86,801
|
)
|
||
Purchases of long-term investments
|
(2,019
|
)
|
|
—
|
|
||
Proceeds from sales of property, plant and equipment
|
3,948
|
|
|
3,935
|
|
||
Cash used in investing activities
|
(95,539
|
)
|
|
(82,866
|
)
|
||
|
|
|
|
||||
CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES:
|
|
|
|
||||
Repayments of long-term debt
|
(3,416
|
)
|
|
(43,416
|
)
|
||
Proceeds from revolving credit facility borrowings
|
3,015,200
|
|
|
408,670
|
|
||
Repayments of revolving credit facility borrowings
|
(2,867,200
|
)
|
|
(433,670
|
)
|
||
Debt issuance costs
|
(1,701
|
)
|
|
—
|
|
||
Net proceeds from stock issuances
|
3,890
|
|
|
25,751
|
|
||
Repurchases of common stock
|
(150,162
|
)
|
|
(37,593
|
)
|
||
Holdback payment for a prior business combination
|
—
|
|
|
(2,262
|
)
|
||
Cash used in financing activities
|
(3,389
|
)
|
|
(82,520
|
)
|
||
|
|
|
|
||||
Effect of exchange rate changes
|
1,164
|
|
|
929
|
|
||
Increase (decrease) in cash and cash equivalents
|
(1,884
|
)
|
|
37,212
|
|
||
Cash and cash equivalents at beginning of period
|
406,661
|
|
|
398,288
|
|
||
Cash and cash equivalents at end of period
|
$
|
404,777
|
|
|
$
|
435,500
|
|
|
|
|
|
||||
Cash paid during the period for:
|
|
|
|
||||
Interest, net of capitalized interest
|
$
|
23,985
|
|
|
$
|
17,439
|
|
Income taxes, net of refunds
|
$
|
27,434
|
|
|
$
|
17,338
|
|
Unpaid purchases of property, plant and equipment at the end of period
|
$
|
32,529
|
|
|
$
|
44,004
|
|
|
As of
|
||||||
|
June 30,
2018 |
|
September 30,
2017 |
||||
|
(In thousands)
|
||||||
Raw materials
|
$
|
970,756
|
|
|
$
|
834,694
|
|
Work-in-process
|
109,053
|
|
|
106,914
|
|
||
Finished goods
|
107,197
|
|
|
110,061
|
|
||
Total
|
$
|
1,187,006
|
|
|
$
|
1,051,669
|
|
|
As of
|
||||||
|
June 30,
2018 |
|
September 30,
2017 |
||||
Derivatives Designated as Accounting Hedges:
|
|
|
|
||||
Notional amount (in thousands)
|
$
|
106,106
|
|
|
$
|
105,523
|
|
Number of contracts
|
57
|
|
|
58
|
|
||
Derivatives Not Designated as Accounting Hedges:
|
|
|
|
||||
Notional amount (in thousands)
|
$
|
315,259
|
|
|
$
|
302,944
|
|
Number of contracts
|
51
|
|
|
46
|
|
|
As of
|
||||||
|
June 30,
2018 |
|
September 30,
2017 |
||||
|
(In thousands)
|
||||||
Senior secured notes due 2019
|
$
|
375,000
|
|
|
$
|
375,000
|
|
Non-interest bearing promissory notes
|
17,842
|
|
|
19,863
|
|
||
Total long-term debt
|
392,842
|
|
|
394,863
|
|
||
Less: Current portion of non-interest bearing promissory notes
|
3,280
|
|
|
3,416
|
|
||
Current portion of long-term debt
|
375,000
|
|
|
—
|
|
||
Long-term debt
|
$
|
14,562
|
|
|
$
|
391,447
|
|
|
|
|
Restructuring Expense
|
||||||||
|
Estimated Costs to Implement
|
|
Three Months Ended
June 30, 2018 |
|
Nine Months Ended
June 30, 2018 |
||||||
|
(In thousands)
|
||||||||||
Severance costs (approximately 2,900 employees)
|
$
|
27,700
|
|
|
$
|
758
|
|
|
$
|
25,250
|
|
Other exit costs (will be recognized as incurred)
|
7,300
|
|
|
89
|
|
|
363
|
|
|||
Total
|
35,000
|
|
|
847
|
|
|
25,613
|
|
|||
Severance reimbursement
|
(10,000
|
)
|
|
—
|
|
|
(10,000
|
)
|
|||
Total - Q1 FY18 plan
|
25,000
|
|
|
847
|
|
|
15,613
|
|
|||
Costs incurred for other plans
|
—
|
|
|
174
|
|
|
359
|
|
|||
Total - all plans
|
$
|
25,000
|
|
|
$
|
1,021
|
|
|
$
|
15,972
|
|
|
As of
|
||||||
|
June 30,
2018 |
|
September 30,
2017 |
||||
|
(In thousands)
|
||||||
Foreign currency translation adjustments
|
$
|
90,482
|
|
|
$
|
90,952
|
|
Unrealized holding losses on derivative financial instruments
|
(536
|
)
|
|
(212
|
)
|
||
Unrecognized net actuarial losses and transition costs for benefit plans
|
(13,341
|
)
|
|
(13,946
|
)
|
||
Total
|
$
|
76,605
|
|
|
$
|
76,794
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(In thousands)
|
||||||||||||||
Gross sales:
|
|
|
|
|
|
|
|
||||||||
IMS
|
$
|
1,490,069
|
|
|
$
|
1,408,442
|
|
|
$
|
4,293,497
|
|
|
$
|
4,205,149
|
|
CPS
|
374,642
|
|
|
356,998
|
|
|
1,077,103
|
|
|
1,057,709
|
|
||||
Intersegment revenue
|
(51,345
|
)
|
|
(54,063
|
)
|
|
(136,805
|
)
|
|
(149,242
|
)
|
||||
Net sales
|
$
|
1,813,366
|
|
|
$
|
1,711,377
|
|
|
$
|
5,233,795
|
|
|
$
|
5,113,616
|
|
|
|
|
|
|
|
|
|
||||||||
Gross profit:
|
|
|
|
|
|
|
|
||||||||
IMS
|
$
|
85,381
|
|
|
$
|
106,841
|
|
|
$
|
253,914
|
|
|
$
|
310,122
|
|
CPS
|
31,300
|
|
|
26,229
|
|
|
92,538
|
|
|
95,021
|
|
||||
Total
|
116,681
|
|
|
133,070
|
|
|
346,452
|
|
|
405,143
|
|
||||
Unallocated items (1)
|
1,855
|
|
|
(2,382
|
)
|
|
(3,752
|
)
|
|
(9,083
|
)
|
||||
Total
|
$
|
118,536
|
|
|
$
|
130,688
|
|
|
$
|
342,700
|
|
|
$
|
396,060
|
|
(1)
|
For purposes of evaluating segment performance, management excludes certain items from its measure of gross profit. These items consist of stock-based compensation expense, amortization of intangible assets, charges or credits resulting from distressed customers and acquisition-related items.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(In thousands)
|
||||||||||||||
Net sales
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
344,149
|
|
|
$
|
313,123
|
|
|
$
|
980,294
|
|
|
$
|
916,513
|
|
Mexico
|
529,864
|
|
|
479,058
|
|
|
1,513,858
|
|
|
1,422,790
|
|
||||
China
|
305,350
|
|
|
353,372
|
|
|
886,355
|
|
|
988,851
|
|
||||
Malaysia
|
161,478
|
|
|
170,133
|
|
|
497,828
|
|
|
575,791
|
|
||||
Other international
|
472,525
|
|
|
395,691
|
|
|
1,355,460
|
|
|
1,209,671
|
|
||||
Total
|
$
|
1,813,366
|
|
|
$
|
1,711,377
|
|
|
$
|
5,233,795
|
|
|
$
|
5,113,616
|
|
Percentage of net sales represented by ten largest customers
|
52
|
%
|
|
53
|
%
|
|
53
|
%
|
|
53
|
%
|
Number of customers representing 10% or more of net sales
|
1
|
|
|
2
|
|
|
1
|
|
|
2
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(In thousands, except per share data)
|
||||||||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
33,963
|
|
|
$
|
36,404
|
|
|
$
|
(96,315
|
)
|
|
$
|
112,985
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding
|
68,907
|
|
|
75,332
|
|
|
70,366
|
|
|
74,548
|
|
||||
Effect of dilutive stock options and restricted stock units
|
3,146
|
|
|
2,909
|
|
|
—
|
|
|
3,369
|
|
||||
Denominator for diluted earnings per share
|
72,053
|
|
|
78,241
|
|
|
70,366
|
|
|
77,917
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.49
|
|
|
$
|
0.48
|
|
|
$
|
(1.37
|
)
|
|
$
|
1.52
|
|
Diluted
|
$
|
0.47
|
|
|
$
|
0.47
|
|
|
$
|
(1.37
|
)
|
|
$
|
1.45
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(In thousands)
|
||||||||||||||
Stock options
|
$
|
1,362
|
|
|
$
|
362
|
|
|
$
|
5,105
|
|
|
$
|
1,292
|
|
Restricted stock units, including performance based awards
|
8,399
|
|
|
6,927
|
|
|
23,593
|
|
|
25,616
|
|
||||
Total
|
$
|
9,761
|
|
|
$
|
7,289
|
|
|
$
|
28,698
|
|
|
$
|
26,908
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(In thousands)
|
||||||||||||||
Cost of sales
|
$
|
2,055
|
|
|
$
|
1,879
|
|
|
$
|
6,354
|
|
|
$
|
6,778
|
|
Selling, general and administrative
|
7,490
|
|
|
5,276
|
|
|
22,042
|
|
|
19,492
|
|
||||
Research and development
|
216
|
|
|
134
|
|
|
302
|
|
|
638
|
|
||||
Total
|
$
|
9,761
|
|
|
$
|
7,289
|
|
|
$
|
28,698
|
|
|
$
|
26,908
|
|
|
Number of
Shares
|
|
Weighted-
Average
Exercise Price
($)
|
|
Weighted-
Average
Remaining
Contractual
Term
(Years)
|
|
Aggregate
Intrinsic
Value of
In-The-Money
Options
($)
|
|||
|
(In thousands)
|
|
|
|
|
|
(In thousands)
|
|||
Outstanding as of September 30, 2017
|
3,568
|
|
|
11.83
|
|
|
3.82
|
|
90,327
|
|
Granted
|
200
|
|
|
38.45
|
|
|
|
|
|
|
Exercised/Cancelled/Forfeited/Expired
|
(381
|
)
|
|
11.47
|
|
|
|
|
|
|
Outstanding as of June 30, 2018
|
3,387
|
|
|
13.44
|
|
|
3.64
|
|
58,397
|
|
Vested and expected to vest as of June 30, 2018
|
3,385
|
|
|
13.44
|
|
|
3.63
|
|
58,384
|
|
Exercisable as of June 30, 2018
|
3,201
|
|
|
12.16
|
|
|
3.34
|
|
58,170
|
|
|
Number of
Shares
|
|
Weighted-
Average Grant Date
Fair Value
($)
|
|
Weighted-
Average
Remaining
Contractual
Term
(Years)
|
|
Aggregate
Intrinsic
Value
($)
|
|||
|
(In thousands)
|
|
|
|
|
|
(In thousands)
|
|||
Outstanding as of September 30, 2017
|
3,359
|
|
|
27.56
|
|
|
1.51
|
|
124,800
|
|
Granted
|
1,098
|
|
|
33.52
|
|
|
|
|
|
|
Vested/Forfeited/Cancelled
|
(1,089
|
)
|
|
25.18
|
|
|
|
|
|
|
Outstanding as of June 30, 2018
|
3,368
|
|
|
30.27
|
|
|
1.46
|
|
101,728
|
|
Expected to vest as of June 30, 2018
|
2,553
|
|
|
29.60
|
|
|
1.46
|
|
77,110
|
|
1.
|
Integrated Manufacturing Solutions (IMS). Our IMS segment consists of printed circuit board assembly and test, final system assembly and test and direct-order-fulfillment.
|
2.
|
Components, Products and Services (CPS). Components include interconnect systems (printed circuit board fabrication, backplane and cable assemblies and plastic injection molding) and mechanical systems (enclosures and precision machining). Products include memory, RF, optical and microelectronics solutions from our Viking Technology division, defense and aerospace products from SCI Technology, computing and data storage from our Newisys division and cloud-based manufacturing execution solutions from our 42Q division. Services include design, engineering, logistics and repair services.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(In thousands)
|
||||||||||||||
Net sales
|
$
|
1,813,366
|
|
|
$
|
1,711,377
|
|
|
$
|
5,233,795
|
|
|
$
|
5,113,616
|
|
Gross profit
|
$
|
118,536
|
|
|
$
|
130,688
|
|
|
$
|
342,700
|
|
|
$
|
396,060
|
|
Operating income
|
$
|
47,060
|
|
|
$
|
66,576
|
|
|
$
|
109,622
|
|
|
$
|
183,398
|
|
Net income (loss) (1)
|
$
|
33,963
|
|
|
$
|
36,404
|
|
|
$
|
(96,315
|
)
|
|
$
|
112,985
|
|
(1)
|
Results of operations for the
nine months ended June 30, 2018
include a
$162 million
non-cash tax charge due to the enactment of the U.S. Tax Cuts and Jobs Act.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
Increase/(Decrease)
|
|
June 30,
2018 |
|
July 1,
2017 |
|
Increase/(Decrease)
|
||||||||||||||||
Communications Networks
|
$
|
673,124
|
|
|
$
|
669,967
|
|
|
$
|
3,157
|
|
0.5
|
%
|
|
$
|
1,994,305
|
|
|
$
|
1,937,103
|
|
|
$
|
57,202
|
|
3.0
|
%
|
Industrial, Automotive and Defense
|
634,490
|
|
|
613,151
|
|
|
21,339
|
|
3.5
|
%
|
|
1,857,543
|
|
|
1,855,847
|
|
|
1,696
|
|
0.1
|
%
|
||||||
Medical
|
301,721
|
|
|
232,471
|
|
|
69,250
|
|
29.8
|
%
|
|
825,055
|
|
|
697,845
|
|
|
127,210
|
|
18.2
|
%
|
||||||
Cloud Solutions
|
204,031
|
|
|
195,788
|
|
|
8,243
|
|
4.2
|
%
|
|
556,892
|
|
|
622,821
|
|
|
(65,929
|
)
|
(10.6
|
)%
|
||||||
Total
|
$
|
1,813,366
|
|
|
$
|
1,711,377
|
|
|
$
|
101,989
|
|
6.0
|
%
|
|
$
|
5,233,795
|
|
|
$
|
5,113,616
|
|
|
$
|
120,179
|
|
2.4
|
%
|
•
|
Changes in customer demand and sales volumes for our vertically integrated system components and subassemblies;
|
•
|
Changes in the overall volume of our business, which affect the level of capacity utilization;
|
•
|
Changes in the mix of high and low margin products demanded by our customers;
|
•
|
Parts shortages and extended parts lead times caused by high demand or natural disasters, and related operational disruption and inefficiencies;
|
•
|
Greater competition in the EMS industry and pricing pressures from OEMs due to greater focus on cost reduction;
|
•
|
Provisions for excess and obsolete inventory, including provisions associated with distressed customers;
|
•
|
Levels of operational efficiency and production yields;
|
•
|
Wage inflation and rising materials costs;
|
•
|
Our ability to transition the location of and ramp manufacturing and assembly operations when requested by a customer in a timely and cost-effective manner.
|
|
|
|
Restructuring Expense
|
||||||||
|
Estimated Costs to Implement
|
|
Three Months Ended
June 30, 2018 |
|
Nine Months Ended
June 30, 2018 |
||||||
|
(In thousands)
|
||||||||||
Severance costs (approximately 2,900 employees)
|
$
|
27,700
|
|
|
$
|
758
|
|
|
$
|
25,250
|
|
Other exit costs (will be recognized as incurred)
|
7,300
|
|
|
89
|
|
|
363
|
|
|||
Total
|
35,000
|
|
|
847
|
|
|
25,613
|
|
|||
Severance reimbursement
|
(10,000
|
)
|
|
—
|
|
|
(10,000
|
)
|
|||
Total - Q1 FY18 plan
|
25,000
|
|
|
847
|
|
|
15,613
|
|
|||
Costs incurred for other plans
|
—
|
|
|
174
|
|
|
359
|
|
|||
Total - all plans
|
$
|
25,000
|
|
|
$
|
1,021
|
|
|
$
|
15,972
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
|
(In thousands)
|
||||||||||||||
Foreign exchange gains (losses)
|
$
|
(639
|
)
|
|
$
|
349
|
|
|
$
|
757
|
|
|
$
|
4,154
|
|
Other, net
|
1,639
|
|
|
603
|
|
|
2,990
|
|
|
1,867
|
|
||||
Total
|
$
|
1,000
|
|
|
$
|
952
|
|
|
$
|
3,747
|
|
|
$
|
6,021
|
|
|
Nine Months Ended
|
||||||
|
June 30,
2018 |
|
July 1,
2017 |
||||
|
(In thousands)
|
||||||
Net cash provided by (used in):
|
|
|
|
||||
Operating activities
|
$
|
95,880
|
|
|
$
|
201,669
|
|
Investing activities
|
(95,539
|
)
|
|
(82,866
|
)
|
||
Financing activities
|
(3,389
|
)
|
|
(82,520
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
1,164
|
|
|
929
|
|
||
Increase (decrease) in cash and cash equivalents
|
$
|
(1,884
|
)
|
|
$
|
37,212
|
|
|
As of
|
||
|
June 30,
2018 |
|
September 30,
2017 |
Days sales outstanding (1)
|
56
|
|
55
|
Inventory turns (2)
|
5.9
|
|
6.2
|
Days inventory on hand (3)
|
62
|
|
59
|
Accounts payable days (4)
|
69
|
|
71
|
Cash cycle days (5)
|
49
|
|
43
|
(1)
|
Days sales outstanding (a measure of how quickly we collect our accounts receivable), or "DSO", is calculated as the ratio of average accounts receivable, net, to average daily net sales for the quarter.
|
(2)
|
Inventory turns (annualized) are calculated as the ratio of four times our cost of sales for the quarter to average inventory.
|
(3)
|
Days inventory on hand is calculated as the ratio of average inventory for the quarter to average daily cost of sales for the quarter.
|
(4)
|
Accounts payable days (a measure of how quickly we pay our suppliers), or "DPO", is calculated as the ratio of 365 days divided by accounts payable turns, in which accounts payable turns is calculated as the ratio of four times our cost of sales for the quarter to average accounts payable.
|
(5)
|
Cash cycle days is calculated as days inventory on hand plus days sales outstanding minus accounts payable days.
|
•
|
intense competition among our customers and their competitors, leading to reductions in prices for their products and pricing pressures on us;
|
•
|
failure of our customers' products to gain widespread commercial acceptance which could decrease the volume of orders customers place with us;
|
•
|
changes in regulatory requirements affecting the products we build for our customers, leading to product obsolescence and potentially causing us to lose business; and
|
•
|
recessionary periods in our customers' markets, including the currently depressed conditions in the oil and gas industry, which decrease orders from affected customers.
|
•
|
our ability to replace declining sales from end-of-life programs with new business wins;
|
•
|
conditions in the economy as a whole and in the industries we serve;
|
•
|
fluctuations in components prices and component shortages or extended parts lead time caused by high demand, natural disaster or otherwise;
|
•
|
timing of new product development by our customers, which creates demand for our services, but which can also require us to incur start-up costs relating to new tooling and processes;
|
•
|
levels of demand in the end markets served by our customers;
|
•
|
timing of orders from customers and the accuracy of their forecasts;
|
•
|
inventory levels of customers, which if high relative to their normal sales volume, could cause them to reduce their orders to us;
|
•
|
timing of new program ramps in which expenditures are made in anticipation of increased sales or for which low product yields and design changes can significantly impact profitability;
|
•
|
customer product delivery requirements and shortages of components or labor;
|
•
|
customer payment terms and the extent to which we factor customer receivables during the quarter;
|
•
|
increasing labor costs in the regions in which we operate;
|
•
|
mix of products ordered by and shipped to major customers, as high volume and low complexity manufacturing services typically have lower gross margins than more complex and lower volume services;
|
•
|
degree to which we are able to utilize our available manufacturing capacity;
|
•
|
customer insolvencies resulting in bad debt or inventory exposures that are in excess of our reserves;
|
•
|
our ability to efficiently move manufacturing activities to lower cost regions;
|
•
|
changes in our tax provision due to changes in our estimates of pre-tax income in the jurisdictions in which we operate, uncertain tax positions, and our ability to utilize our deferred tax assets; and
|
•
|
political and economic developments in countries in which we have operations which could restrict our operations or increase our costs.
|
•
|
the imposition of currency controls;
|
•
|
changes in trade and tax laws that may result in us or our customers being subjected to increased taxes, duties and tariffs and thus increase our costs and/or reduce our customers’ willingness to use our services in countries in which we are currently manufacturing their products;
|
•
|
compliance with laws concerning the export of U.S. technology, including the International Traffic in Arms Regulations (“ITAR”) and the Export Administration Regulations (“EAR”), sanctions administered by the Office of Foreign Asset Controls (“OFAC”) and the Foreign Corrupt Practices Act;
|
•
|
rising labor costs;
|
•
|
compliance with foreign labor laws, which generally provide for increased notice, severance and consultation requirements compared to U.S. laws;
|
•
|
permit and licensing requirements;
|
•
|
labor unrest, including strikes;
|
•
|
difficulties in staffing due to immigration or travel restrictions imposed by national governments, including the U.S.;
|
•
|
security concerns;
|
•
|
political instability and/or regional military tension or hostilities;
|
•
|
inflexible employee contracts or labor laws in the event of business downturns;
|
•
|
coordinating communications among and managing our international operations;
|
•
|
fluctuations in currency exchange rates, which may either increase or decrease our operating costs and for which we have significant exposure;
|
•
|
changes in tax and trade laws that increase our local costs;
|
•
|
exposure to heightened corruption risks;
|
•
|
aggressive, selective or lax enforcement of laws and regulations by national governmental authorities;
|
•
|
adverse rulings in regards to tax audits; and
|
•
|
misappropriation of intellectual property.
|
Period (1)
|
|
TOTAL NUMBER OF SHARES PURCHASED
|
|
AVERAGE PRICE PAID PER SHARE
(2)
|
|
TOTAL NUMBER OF SHARES PURCHASED AS PART OF PUBLICLY ANNOUNCED PROGRAMS
|
|
MAXIMUM DOLLAR VALUE OF SHARES THAT MAY YET BE PURCHASED UNDER THE PROGRAMS
(2)
|
|
||||||
Month #1
|
|
|
|
|
|
|
|
|
|
||||||
April 1, 2018 through April 28, 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
143,969,585
|
|
|
Month #2
|
|
|
|
|
|
|
|
|
|
||||||
April 29, 2018 through May 26, 2018
|
|
800
|
|
|
$
|
29.84
|
|
|
800
|
|
|
$
|
143,945,710
|
|
|
Month #3
|
|
|
|
|
|
|
|
|
|
||||||
May 27, 2018 through June 30, 2018
|
|
961,661
|
|
|
$
|
30.01
|
|
|
961,661
|
|
|
$
|
115,084,716
|
|
|
Total
|
|
962,461
|
|
|
$
|
30.01
|
|
|
962,461
|
|
|
|
|
(1)
|
All months shown are our fiscal months.
|
(2)
|
Amounts do not include commission payable on shares repurchased. The total average price paid per share is a weighted average based on the total number of shares repurchased during the period.
|
Exhibit Number
|
|
Description
|
|
|
|
10.34‡
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1 (1)
|
|
|
|
|
|
32.2 (1)
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
‡
|
Portions of this exhibit have been omitted pursuant to a request for confidential treatment and this exhibit has been filed separately with the SEC.
|
(1)
|
This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.
|
|
|
SANMINA CORPORATION
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
By:
|
/s/ ROBERT K. EULAU
|
|
|
|
Robert K. Eulau
|
|
|
|
Chief Executive Officer (Principal Executive Officer)
|
|
|
|
|
Date:
|
August 3, 2018
|
|
|
|
|
|
|
|
|
By:
|
/s/ DAVID R. ANDERSON
|
|
|
|
David R. Anderson
|
|
|
|
Executive Vice President and
|
|
|
|
Chief Financial Officer (Principal Financial Officer)
|
|
|
|
|
Date:
|
August 3, 2018
|
|
1.
|
Sale and Purchase
|
1
|
2.
|
No Administrative Agent or Buyer Liability
|
3
4
|
3.
|
Representations and Warranties
|
4
|
4.
|
Covenants
|
4
|
5.
|
Servicing Activities
.
|
4
5
|
6.
|
Deemed Collections; Events of Repurchase; Indemnities and Setoff
.
|
7
8
|
7.
|
Guaranty
.
|
9
11
|
8.
|
Administrative Agent
|
10
12
|
9.
|
Notices
|
12
16
|
10.
|
Survival
|
14
17
|
11.
|
Expenses
|
14
17
|
12.
|
Interest on Overdue Amounts
|
14
18
|
13.
|
Governing Law
|
14
18
|
14.
|
No Non-Direct Damages
|
14
18
|
15.
|
Joinder of Additional Sellers
|
14
18
|
16.
|
Addition of Account Debtor
|
15
19
|
17.
|
Joint and Several Obligations
|
15
19
|
18.
|
General Provisions
.
|
15
19
|
19.
|
Confidentiality; Disclosure Required by Law
|
18
22
|
|
i
|
|
|
ii
|
|
|
1
|
|
as Seller or Servicer:
|
Sanmina Corporation
2700 North First Street San Jose, California 95134 Attention: David R. Anderson, Executive Vice President and Chief Financial Officer Email: |
If to Guarantor:
|
1251 Avenue of the Americas
New York, New York 10020-1104 Attention: Gustavo Rizzo; Gauri Duggal; Jason Wu ; |
Brian McNany
Email: |
With a copy to:
|
The
MUFG
Bank
of Tokyo-Mitsubishi UFJ
, Ltd.
1251 Avenue of the Americas New York, New York 10020-1104 Attention: Amy Mellon Grandis Email: |
For MUFG Bank
:
|
MUFG Bank, Ltd.
1251 Avenue of the Americas New York, New York 10020-1104 Attention: Gustavo Rizzo; Gauri Duggal; Jason Wu ; Brian McNany Email: |
For Wells:
|
Wells Fargo Bank, N.A.
|
(Purchase Requests only)
|
301 South College Street, 5
th
Floor
Charlotte, NC 28202 Attention: Vladimir Mashchenko, Director, Supply Chain Finance Telephone No. Email: |
also add
|
The Bank of Tokyo Mitsubishi UFJ, Ltd.
|
For BOW:
|
Bank of the West
|
ACCOUNT DEBTOR
NAME
|
ACCOUNT DEBTOR PURCHASE SUBLIMIT
|
ACCOUNT DEBTOR BUFFER PERIOD
|
DESIGNATED PERCENTAGES
|
[***]
|
$[***]
|
[***]
|
[***]%
|
[***]
|
$[***]
|
[***]
|
[***]%
|
[***]
|
$[***]
|
[***]
|
[***]%
|
[***]
|
$[***]
|
[***]
|
[***]%
|
Account Debtor Name
|
Other Permitted Governing Law
|
Account Debtor Purchase Sublimit
|
Account Debtor Buffer Period
|
Designated Percentages
|
Buyer
|
[***]
|
|
$[***]
|
[***]
|
[***]%
|
[***]
|
[***]
|
|
$[***]
|
[***]
|
||
[***]
|
|
$[***]
3
|
[***]
|
[***]%
|
[***]
|
[***]
|
|
[***]
|
|||
[***]
|
|
$[***]
|
[***]
|
[***]%
|
[***]
|
[***]
|
|
$[***]
|
[***]
|
[***]%
|
[***]
|
[***]
|
|
$[***]
|
[***]
|
[***]%
|
[***]
|
[***]
|
|
$[***]
|
[***]
|
[***]%
|
[***]
|
[***]
|
[***]
|
$[***]
4
|
[***]
|
[***]%
[***]%
|
[***]
|
[***]
|
[***]
|
||||
[***]
|
|
$[***]
|
[***]
|
[***]%
|
[***]
|
[***]
|
|
$[***]
|
[***]
|
[***]%
|
[***]
|
[***]
|
[***]
|
$[***]
5
|
[***]
|
[***]%
|
[***]
|
[***]
|
[***]
|
||||
[***]
|
[***]
|
||||
[***]
|
[***]
|
||||
[***]
|
[***]
|
||||
[***]
|
[***]
|
||||
[***]
|
|
$[***]
|
[***]
|
[***]%
|
[***]
|
MUFG Bank, Ltd.
|
$180,000,000
|
Bank of the West
|
$150,000,000
|
Wells Fargo Bank, N.A.
|
$125,000,000
|
(a) Name:
|
[●]
|
(b) Chief Executive Office:
|
[●]
|
(c) Jurisdiction of Organization:
|
[●]
|
(d) Organizational Number:
|
[●]
|
(e) FEIN:
|
[●]
|
(f) Tradenames:
|
[●]
|
(g) Changes in Location, Name and Corporate Organization in the last 5 years:
|
[●]
|
By:
|
Name: Title: |
By:
|
Name: Title: |
By:
|
Name: Title: |
By:
|
Name: Title: |
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Sanmina Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
|
4.
|
The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and
|
5.
|
The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's Board of Directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.
|
Date:
|
August 3, 2018
|
|
/s/ ROBERT K. EULAU
|
|
|
Robert K. Eulau
|
|
|
Chief Executive Officer (Principal Executive Officer)
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Sanmina Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
|
4.
|
The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and
|
5.
|
The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's Board of Directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.
|
Date:
|
August 3, 2018
|
|
/s/ DAVID R. ANDERSON
|
|
|
David Anderson
|
|
|
Chief Financial Officer (Principal Financial Officer)
|
1.
|
The Company's Quarterly Report on Form 10-Q for the period ended
June 30, 2018
, to which this Certification is attached as Exhibit 32.1 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act; and
|
2.
|
The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ ROBERT K. EULAU
|
|
Robert K. Eulau
|
|
Chief Executive Officer (Principal Executive Officer)
|
1.
|
The Company's Quarterly Report on Form 10-Q for the period ended
June 30, 2018
, to which this Certification is attached as Exhibit 32.2 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act; and
|
2.
|
The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ DAVID R. ANDERSON
|
|
David R. Anderson
|
|
Chief Financial Officer (Principal Financial Officer)
|