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© bahar-bostanci-dreamstime.com Electronics Production | January 25, 2013

Flex 3Q profit falls 75% on restructuring-related charges

Net sales for the third quarter ended December 31, 2012 were $6.1 billion, above the midpoint of the company's previously provided revenue guidance of $5.8 billion to $6.2 billion.
For the third quarter ended December 31, 2012, adjusted net income increased 13% over the year ago quarter to $148 million, compared to $131 million in the year ago quarter.

During the third quarter ended December 31, 2012, Flextronics recognized approximately $103 million of pre-tax restructuring charges comprised of $21 million of cash charges predominantly related to employee severance and benefits and $82 million of non-cash asset impairment charges.

The Company's GAAP operating income and GAAP net income decreased 75% and 70%, respectively, compared to the same quarter last year, reflecting the impacts from the restructuring charges recognized during the third quarter ended December 31, 2012.

The Company expects to recognize an additional $100 million to $125 million in pre-tax restructuring charges in the fourth quarter of fiscal 2013, comprised primarily of employee severance and benefit costs of approximately $90 million to $110 million and the remaining charges associated with other exit related costs.

"It is clear that the macroeconomic environment is challenging with limited visibility and many economic risks remain. We are aggressively optimizing our operating footprint and improving our cost structure to better position us for our multi-billion dollar pipeline of recent bookings, and the eventual improvement in the business environment," said Mike McNamara, CEO of Flextronics. "We are pleased with our exceptional free cash flow generation of $395 million for the third quarter and $678 million year-to-date. Our strong free cash flow has enabled us to aggressively invest in our business through niche acquisitions and supporting our stock repurchase program," added Mr. McNamara.

For the fourth quarter ending March 31, 2013, revenue is expected to be in the range of $5.0 billion to $5.3 billion.

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October 15 2018 11:56 pm V11.6.0-1