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Electronics Production | December 19, 2008

Jabil's core operating income decreased by 17%

Jabil's first quarter of fiscal 2009 core operating income decreased 17% to $101.2 million or 3.0% of net revenue compared to $122.1 million or 3.6% of net revenue for the first quarter of fiscal 2008.
"Our diversification and new business wins helped soften the impact of deteriorating economic conditions," said President and CEO Timothy L. Main.

Net revenue for the first fiscal quarter of fiscal year 2009 remained consistent at $3.4 billion compared to the same period of fiscal 2008. Preliminary GAAP operating income for the first quarter of fiscal 2009 decreased 21% to $77.7 million compared to $98.9 million for the same period of fiscal 2008. Preliminary GAAP net income for the first quarter of fiscal 2009 decreased 25% to net income of $46.2 million compared to $62.0 million of net income for the same period in fiscal 2008. Preliminary GAAP diluted earnings per share for the first quarter of fiscal 2009 decreased 27% to net income per share of $0.22 compared to $0.30 of earnings per share for the same period of fiscal 2008.

Jabil's first quarter of fiscal 2009 core operating income decreased 17% to $101.2 million or 3.0% of net revenue compared to $122.1 million or 3.6% of net revenue for the first quarter of fiscal 2008. Core earnings decreased 16% to $62.8 million compared to $74.6 million for the first quarter of fiscal 2008. Core earnings per share decreased 17% to $0.30 per diluted share for the period compared to $0.36 for the first quarter of fiscal 2008.

Business Update
The Company expects the second fiscal quarter of 2009 net revenue in a range of $2.8 billion to $3.0 billion, with an estimated core operating margin of 2.1 percent. Jabil said its core earnings per share for its second quarter of fiscal 2009 are anticipated to be in a range of $0.12 to $0.16 per diluted share. GAAP earnings per share are estimated to be $0.04 to $0.08 per diluted share. (GAAP for the second quarter of fiscal 2009 earnings per share are currently estimated to include $0.03 per share for amortization of intangibles and $0.05 per share for stock-based compensation and related charges.) "We are taking a conservative position regarding demand for our second quarter," said Jabil President and CEO Tim Main.

"Although end markets are weak, the opportunity to expand our market share in targeted areas is very good. We intend to capitalize on the present opportunities to ensure a more robust future when end markets stabilize and the recovery cycle begins," said Mr Main.

"Liquidity and a resilient balance sheet are key advantages in this market environment. The $1.4 billion of liquidity we enjoyed at the end of our first quarter should improve as our working capital and capital expenditure requirements decline during our second quarter." Jabil has nearly $600 million in cash and $800 million available under a five-year revolving credit facility expiring in 2012.

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