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Electronics Production | October 28, 2011

Benchmark: $44 million Q3 sales drop

Benchmark Electronics announced sales of $570 million for the quarter ended September 30, 2011, compared to $614 million for the same quarter last year.
“During the quarter we experienced an unanticipated decline in demand primarily concentrated in the test and instrumentation industry. The significant drop in revenues, and to a lesser extent, transition costs to low-cost geographies, adversely impacted our operating margin for the quarter,” said Cary T. Fu, the Company’s Chief Executive Officer on Q3 results.

The Company reported third quarter net income of $20 million, or $0.34 per diluted share, which includes a discrete income tax benefit of $9 million, or $0.16 per diluted share ($22 million in Q3 2010).

Regarding the recent flooding in Thailand, Fu said that the company is ”rapidly ramping capacity” at facilities around the world, including the recently restarted facility in Korat, Thailand.


Q3 Summary

Income tax benefit includes $9 million ($0.16 per diluted share) of net discrete tax benefits primarily related to income tax valuation allowances. Excluding these tax benefits the tax rate for the quarter was 7.4%

Operating margin for the third quarter was 2.1% excluding restructuring charges

Cash flows used in operating activities for the third quarter were approximately $12 million

Cash and long-term investments balance was $279 million at September 30, 2011. Long- term investments consist of $25 million of auction rate securities

Accounts receivable was $463 million at September 30, 2011; calculated days sales outstanding were 73 days

Inventory was $430 million at September 30, 2011; inventory turns were 5.0 times

Repurchases of common shares for the third quarter totaled $29 million or 2 million
shares.

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