Sanmina Reports First Quarter Fiscal 2013 Results

              Sanmina Reports First Quarter Fiscal 2013 Results

PR Newswire

SAN JOSE, Calif., Jan. 28, 2013

SAN JOSE, Calif., Jan. 28, 2013 /PRNewswire/ --Sanmina Corporation ("Sanmina"
or the "Company") (NASDAQ GS: SANM), a leading integrated manufacturing
solutions company, today reported financial results for the first fiscal
quarter ended December 29, 2012.

(Logo: http://photos.prnewswire.com/prnh/20110707/SF30965LOGO)

First Quarter Fiscal 2013 Summary

  oRevenue of $1.49 billion
  oGAAP^(1) operating margin of 2.1 percent
  oGAAP^(1) diluted earnings per share of $0.01
  oNon-GAAP^(2) operating margin of 2.8 percent
  oNon-GAAP^(2) diluted earnings per share of $0.29

Revenue for the first quarter was $1.49 billion, compared to $1.58 billion in
the prior quarter and $1.50 billion for the same period of fiscal 2012. 

GAAP operating income in the first quarter was $31.5 million or 2.1 percent of
revenue, compared to $39.7 million or 2.6 percent of revenue for the same
period ended December 31, 2011. GAAP net income in the first quarter was $621
thousand, compared to $8.6 million for the same period a year ago. GAAP
diluted earnings per share for the quarter were $0.01, compared to $0.10 in
the first quarter of fiscal 2012.

Non-GAAP operating income in the first quarter was $41.4 million or 2.8
percent of revenue, compared to $49.9 million or 3.3 percent of revenue in the
first quarter fiscal 2012. Non-GAAP net income in the first quarter was $24.2
million, compared to $22.8 million in the same period a year ago. Non-GAAP
diluted earnings per share were $0.29, compared to $0.28 for the same period a
year ago. 

Cash and cash equivalents for the quarter ended December 29, 2012 were $490.7
million. Cash flow from operations was $97.1 million for the quarter.
Inventory turns were 6.9x. Cash cycle days were 51.7 days.

"First quarter revenue and EPS were below expectations due to weak demand
across most of our market segments," stated Jure Sola, Chairman and Chief
Executive Officer of Sanmina Corporation. "Our second quarter guidance
reflects seasonality along with continued uncertainty in the
macro-environment. Based on the pipeline of new business opportunities and
the ramping of new programs in fiscal 2013, we should see improvements in the
second half of the year."

"I am pleased with our balance sheet performance. We delivered another
quarter of solid cash flow affording us the opportunity to redeem the
remaining $257 million of the 2014 Notes in the second quarter. Redemption of
these Notes is paramount to our financial flexibility," concluded Sola.

Company Completes Partial Redemption of Senior Floating Rate Notes Due 2014
On January 9, 2013 the Company completed the redemption of $100 million in
aggregate principal amount of its Senior Floating Rate Notes due in 2014 (the
"Notes") using existing cash. This follows the Company's call for redemption
of the Notes previously announced on December 10, 2012.

Company Calls for Full Redemption of Senior Floating Rate Notes Due 2014
The Company also announced today that it is calling for redemption on February
27, 2013 all of the remaining outstanding principal amount of the Notes. The
aggregate principal amount of the Notes currently outstanding is $157.4
million. The CUSIP number for the Notes being called for redemption is 800907
AN7. Upon redemption, holders of the Notes being redeemed will receive $1,000
per $1,000 principal amount of Notes, plus accrued and unpaid interest on the
Notes being redeemed to, but excluding, the redemption date.

The redemption is anticipated to be funded through existing cash and
borrowings under the Company's credit facility.

A Notice of Redemption is being mailed to all registered holders of the
Notes. Copies of the Notice of Redemption may be obtained from U.S. Bank
National Association, the Paying Agent, by calling (800) 934-6802.

Second Quarter Fiscal 2013 Outlook
The following forecast is for the second fiscal quarter ending March 30,
2013. These statements are forward-looking and actual results may differ
materially.

  oRevenue between $1.40 billion to $1.45 billion
  oNon-GAAP diluted earnings per share between $0.26 to $0.32

Company Conference Call Information
Sanmina will hold a conference call regarding results for the first quarter
fiscal year 2013 on Monday, January 28, 2013 at 5:00 p.m. ET (2:00 p.m. PT).
The access numbers are: domestic 877-273-6760 and international
706-634-6605. The conference will also be broadcast live over the Internet.
You can log on to the live webcast at www.sanmina.com. Additional information
in the form of a slide presentation is available by logging onto Sanmina's
website at www.sanmina.com. A replay of the conference call will be available
for 48-hours. The access numbers are: domestic 855-859-2056 and international
404-537-3406, access code is 89523371.

^(1)Today a distressed customer filed for bankruptcy protection in the U.S. We
have approximately $2 million of exposure related to this customer. We are
currently evaluating this new development and it is possible that additional
reserves may need to be established prior to our filing of our quarterly
report on Form 10-Q. Therefore, it is possible that our GAAP financial
results may change from those presented today.

^(2)In the commentary set forth above and/or in the financial statements
included in this earnings release, we present the following non-GAAP financial
measures: operating income, operating margin, net income and diluted earnings
per share. In computing each of these non-GAAP financial measures, we exclude
charges or gains relating to: stock-based compensation expenses, restructuring
costs (including employee severance and benefits costs and charges related to
excess facilities and assets), acquisition and integration costs (consisting
of costs associated with the acquisition and integration of acquired
businesses into our operations), impairment charges for goodwill and other
assets, amortization expense and other infrequent or unusual items (including
charges associated with distressed customers, litigation settlements, gains
and losses on sales of assets and redemptions of debt and discrete tax
events), to the extent material or which we consider to be of a
non-operational nature in the applicable period. See Schedule 1 below for
more information regarding our use of non-GAAP financial measures, including
the economic substance behind each exclusion, the manner in which management
uses non-GAAP measures to conduct and evaluate the business, the material
limitations associated with using such measures and the manner in which
management compensates for such limitations. A reconciliation from GAAP to
non-GAAP results is included in the financial statements contained in this
release and is also available on the Investor Relations section of our website
at www.sanmina.com. Sanmina provides second quarter fiscal 2013 outlook only
on a non-GAAP basis due to the inherent uncertainties associated with
forecasting the timing and amount of acquisitions, restructuring activities,
asset impairments and other unusual and infrequent items.

About Sanmina
Sanmina Corporation is a leading integrated manufacturing solutions provider
serving the fastest-growing segments of the global Electronics Manufacturing
Services (EMS) market. Recognized as a technology leader, Sanmina provides
end-to-end manufacturing solutions, delivering superior quality and support to
OEMs primarily in the communications, defense and aerospace, industrial and
semiconductor systems, medical, multimedia, computing and storage, automotive
and clean technology sectors. Sanmina has facilities strategically located in
key regions throughout the world. More information regarding the company is
available at www.sanmina.com.

Sanmina Safe Harbor Statement
Certain statements contained in this press release, including the Company's
expectations for business improvement for the second half of the year and
outlook for future revenue and non-GAAP earnings per share, constitute
forward-looking statements within the meaning of the safe harbor provisions of
Section 21E of the Securities Exchange Act of 1934. Actual results could
differ materially from those projected in these statements as a result of a
number of factors, including a deterioration in the markets for the Company's
customers' products; inability of customers to pay for the Company's products
due to bankruptcy filings or otherwise, which could reduce the Company's
revenues, margins and net income; reduction or cancelation of customer orders
that would reduce revenues, margins and net income ; the sufficiency of the
Company's cash position and other sources of liquidity to operate and expand
its business; an increase in short-term interest rates that would increase the
Company's interest expense; component shortages, which could result in
production delays or increases in manufacturing costs; competition negatively
impacting the Company's revenues and margins; the need to adopt future
restructuring plans as a result of changes in the Company's business, which
would increase the Company's costs and decrease its net income; and the other
factors set forth in the Company's annual and quarterly reports filed with the
Securities Exchange Commission ("SEC").

The Company is under no obligation to (and expressly disclaims any such
obligation to) update or alter any of the forward-looking statements made in
this earnings release, the conference call or the Investor Relations section
of our website whether as a result of new information, future events or
otherwise, unless otherwise required by law.

SANMF

Sanmina Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(GAAP)
                                            December 29,       September 29,
                                            2012               2012
                                            (Unaudited)
ASSETS
Current assets:
   Cash and cash equivalents                $     490,693  $   
                                                               409,618
   Accounts receivable, net                 897,069            1,001,543
   Inventories                              779,859            826,539
   Prepaid expenses and other current       81,140             88,599
   assets
           Total current assets             2,248,761          2,326,299
Property, plant and equipment, net          563,065            569,365
Other                                       267,526            272,122
           Total assets                     $   3,079,352   $   3,167,786
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable                         $     834,307  $   
                                                               937,737
   Accrued liabilities                     100,386            104,741
   Accrued payroll and related benefits     113,949            117,074
   Short-term debt                          162,641            59,995
           Total current liabilities        1,211,283          1,219,547
Long-term liabilities:
   Long-term debt                           734,929            837,364
   Other                                    146,794            147,094
           Total long-term liabilities      881,723            984,458
Total stockholders' equity                  986,346            963,781
           Total liabilities and            $   3,079,352   $   3,167,786
           stockholders' equity





Sanmina Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(GAAP)
(Unaudited)
                                        Three Months Ended
                                        Dec. 29,            Dec. 31,
                                        2012                2011
Net sales                               $  1,494,945      $  1,502,366
Cost of sales                           1,398,017           1,393,341
 Gross profit                           96,928              109,025
Operating expenses:
 Selling, general and administrative    59,868              59,141
 Research and development               5,395               4,133
 Amortization of intangible assets      474                 956
 Restructuring and integration costs   3,947               4,054
 Asset impairments                      -                   1,053
 Gain on sale of long-lived asset       (4,218)             -
  Total operating expenses          65,466              69,337
Operating income                        31,462              39,688
 Interest income                        198                 284
 Interest expense                      (13,084)            (21,863)
 Other expense, net                     (14,922)            (1,518)
Interest and other, net                 (27,808)            (23,097)
Income before income taxes              3,654               16,591
Provision for income taxes             3,033               8,016
Net income                              $       621  $      8,575
 Basic net income per share             $       0.01  $       0.11
 Diluted net income per share           $       0.01  $       0.10
 Weighted-average shares used in
 computing
 per share amounts:
  Basic                                81,920              80,833
  Diluted                              84,011              82,668



Sanmina Corporation
Reconciliation of GAAP to Non-GAAP Measures
(in thousands, except per share amounts)
(Unaudited)
                                      Three Months Ended
                                      Dec. 29,      Sep. 29,       Dec. 31,
                                      2012          2012           2011
GAAP Gross Profit                     $          $   115,157  $  
                                      96,928                      109,025
      GAAP gross margin               6.5%          7.3%           7.3%
Adjustments
      Stock compensation expense      1,340         1,908          907
      (1)
      Amortization of intangible      -             -              104
      assets
      Distressed customer charges     3,020         -              -
      (2)
Non-GAAP Gross Profit                 $           $   117,065  $  
                                      101,288                     110,036
      Non-GAAP gross margin           6.8%          7.4%           7.3%
GAAP Operating Income                 $          $           $   
                                      31,462       32,200         39,688
      GAAP operating margin           2.1%          2.0%           2.6%
Adjustments
      Stock compensation expense      4,666         4,879          4,064
      (1)
      Amortization of intangible      474           672            1,060
      assets
      Distressed customer charges     5,091         -              -
      (2)
      Restructuring, acquisition      3,947         17,899         4,054
      and integration costs
      Gain on sales of long-lived     (4,218)       -              -
      assets
      Asset impairment                -             313            1,053
Non-GAAP Operating Income             $          $           $   
                                      41,422       55,963         49,919
      Non-GAAP operating margin       2.8%          3.5%           3.3%
GAAP Net Income                       $        $   164,150  $    
                                       621                        8,575
Adjustments:
      Operating income adjustments    9,960         23,763         10,231
      (see above)
      Loss on repurchase of debt      -             6,240          -
      (3)
      Loss on dedesignation of        14,903        -              -
      interest rate swap (4)
      Nonrecurring tax items          (1,245)       (156,114)      3,993
Non-GAAP Net Income                   $          $           $   
                                      24,239       38,039         22,799
GAAP Net Income Per Share:
      Basic                           $        $         $     
                                      0.01         2.01           0.11
      Diluted                         $        $         $     
                                      0.01         1.96           0.10
Non-GAAP Net Income Per Share:
      Basic                           $        $         $     
                                      0.30         0.47           0.28
      Diluted                         $        $         $     
                                      0.29         0.46           0.28
Weighted-average shares used in
computing per share amounts:
      Basic                           81,920        81,578         80,833
      Diluted                         84,011        83,556         82,668
(1)   Stock compensation expense
      was as follows:
                                      Three Months Ended
                                      Dec. 29,      Sep. 29,       Dec. 31,
                                      2012          2012           2011
      Cost of sales                   $         $          $     
                                      1,340        1,908          907
      Selling, general and            3,295         2,921          3,130
      administrative
      Research and development        31            50             27
      Stock compensation expense -    $         $          $    
      total company                   4,666        4,879          4,064
(2)   Relates to inventory and bad debt reserves / recoveries associated with
      distressed customers.
(3)   Represents a loss, including write-off of unamortized debt issuance
      costs, on debt redeemed or repurchased prior to maturity.
(4)   Represents a non-cash loss resulting from dedesignation of an interest
      rate swap.



Schedule I

The commentary above includes non-GAAP measures of operating income, operating
margin, net income and earnings per share. Management excludes from these
measures stock-based compensation, restructuring, acquisition and integration
expenses, impairment charges, amortization charges and other infrequent items,
to the extent material or which we consider to be of a non-operational nature
in the applicable period, and as more fully described below.

Management excludes these items principally because such charges are not
directly related to the Company's ongoing core business operations. We use
such non-GAAP measures in order to (1) make more meaningful period-to-period
comparisons of Company's operations, both internally and externally, (2) guide
management in assessing performance of the business, internally allocating
resources and making decisions in furtherance of Company's strategic plan, (3)
provide investors with a better understanding of how management plans and
measures the business and (4) provide investors with a better understanding of
the ongoing, core business. The material limitations to management's approach
include the fact that the charges and expenses excluded are nonetheless
charges required to be recognized under GAAP. Management compensates for these
limitations primarily by using GAAP results to obtain a complete picture of
the Company's performance and by including a reconciliation of non-GAAP
results back to GAAP in its earnings releases.

Additional information regarding the economic substance of each exclusion,
management's use of the resultant non-GAAP measures, the material limitations
of management's approach and management's methods for compensating for such
limitations is provided below.

Stock-based Compensation Expense, which consists of non-cash charges for the
estimated fair value of stock options and unvested restricted stock units
granted to employees, is excluded in order to permit more meaningful
period-to-period comparisons of the Company's results since the Company grants
different amounts and value of stock options in each quarter. In addition,
given the fact that competitors grant different amounts and types of equity
award and may use different option valuation assumptions, excluding
stock-based compensation permits more accurate comparisons of the Company's
core results with those of its competitors.

Restructuring, Acquisition and Integration Expenses, which consist of
severance, lease termination, exit costs and other charges primarily related
to closing and consolidating manufacturing facilities and those associated
with the acquisition and integration of acquired businesses, are excluded
because such charges (1) can be driven by the timing of acquisitions which are
difficult to predict, (2) are not directly related to ongoing business results
and (3) do not reflect expected future operating expenses. In addition, given
the fact that the Company's competitors complete acquisitions and adopt
restructuring plans at different times and in different amounts than the
Company, excluding these charges permits more accurate comparisons of the
Company's core results with those of its competitors. Items excluded by the
Company may be different from those excluded by the Company's competitors and
restructuring and integration expenses include both cash and non-cash
expenses. Cash expenses reduce the Company's liquidity. Therefore, management
also reviews GAAP results including these amounts.

Impairment Charges, which consist of non-cash charges, are excluded because
such charges are non-recurring and do not reduce the Company's liquidity. In
addition, given the fact that the Company's competitors may record impairment
charges at different times, excluding these charges permits more accurate
comparisons of the Company's core results with those of its competitors.

Amortization Charges, which consist of non-cash charges impacted by the timing
and magnitude of acquisitions of businesses or assets, are also excluded
because such charges do not reduce the Company's liquidity. In addition, such
charges can be driven by the timing of acquisitions, which is difficult to
predict. Excluding these charges permits more accurate comparisons of the
Company's core results with those of its competitors because the Company's
competitors complete acquisitions at different times and for different amounts
than the Company.

Other Items, which consist of other infrequent or unusual items (including
charges associated with distressed customers, litigation settlements, gains
and losses on sales of assets and redemptions of debt and discrete tax
events), to the extent material or non-operational in nature, are excluded
because such items are typically non-recurring, difficult to predict or not
directly related to the Company's ongoing core operations. However, items
excluded by the Company may be different from those excluded by the Company's
competitors. In addition, these expenses include both cash and non-cash
expenses. Cash expenses reduce the Company's liquidity. Management compensates
for these limitations by reviewing GAAP results including these amounts.

SOURCE Sanmina Corporation

Website: http://www.sanmina.com
Contact: Paige Bombino, Director, Investor Relations, Sanmina, +1-408-964-3610