MFLEX Announces Preliminary Fiscal 2013 Second Quarter Financial Results

   MFLEX Announces Preliminary Fiscal 2013 Second Quarter Financial Results

PR Newswire

IRVINE, Calif., April 25, 2013

IRVINE, Calif., April 25, 2013 /PRNewswire/ -- Multi-Fineline Electronix, Inc.
(NASDAQ: MFLX), a leading global provider of high-quality, technologically
advanced flexible printed circuit and value-added component assembly solutions
to the electronics industry, today reported preliminary financial results for
its fiscal second quarter ended March 31, 2013.

The Company expects net sales in the second quarter of fiscal 2013 to be
approximately $174 million, below the Company's guidance range of $180 to $200
million. The Company is also reviewing its inventory and currently expects to
record an $11 million write-down of finished goods as a result of unusable
components, as well as a small portion that is being written-down as a result
of uncertainty in near-term demand forecasts. In-line with expectations,
gross margin during the second quarter of fiscal 2013 is expected to be
approximately (2.7) percent, before the impact of the anticipated inventory
write-down. Including the inventory write-down, the GAAP gross margin is
expected to be approximately (8.9) percent. A reconciliation of GAAP gross
margin to non-GAAP gross margin is provided in the table at the end of this
press release. MFLEX expects to provide its complete financial results and
business outlook in its earnings release and conference call on May 2,

Reza Meshgin, Chief Executive Officer of MFLEX commented, "During the second
quarter, we scaled back production as planned, and worked down $50 million in
inventory. This enabled us to generate strong cash flow bringing our cash
balance to about $130 million, in spite of very difficult market conditions.
This challenging period was unfortunately exacerbated by the need to
write-down inventories due to reasons unrelated to MFLEX's operational or
quality performance, as well as further demand softening during the quarter.
While we are pursuing remedies for the unusable components, we believe it may
be prudent to take this charge to write-down finished goods inventory at this

Mr. Meshgin concluded, "Looking ahead, we anticipate similar sales and
approximately breakeven gross margin during the third quarter of fiscal 2013.
However, we continue to expect a significant rebound in revenue and
profitability in the fourth quarter and into fiscal 2014, when we anticipate
an increase in demand from both existing and new customers. While our market
continues to be challenging due to seasonality and product cycles, we are
optimistic that a broader customer and product base will alleviate these
challenges as we enter into fiscal 2014." 

MFLEX ( is a global provider of high-quality, technologically
advanced flexible printed circuit and value-added component assembly solutions
to the electronics industry. The Company is one of a limited number of
manufacturers that provides a seamless, integrated end-to-end flexible printed
circuit solution for customers, ranging from design and application
engineering, prototyping and high-volume manufacturing to turnkey component
assembly and testing. The Company targets its solutions within the electronics
market and, in particular, focuses on applications where flexible printed
circuits are the enabling technology in achieving a desired size, shape,
weight or functionality of an electronic device. Current applications for the
Company's products include smartphones, tablets, computer/data storage,
portable bar code scanners and other consumer electronic devices. MFLEX's
common stock is quoted on the Nasdaq Global Select Market under the symbol

Forward-Looking Statements

Certain statements in this news release are forward-looking statements that
involve a number of risks and uncertainties. These forward-looking statements
include, but are not limited to, statements and predictions regarding:
revenue; net sales; sales; net income; profitability; gross margins; demand
forecasts; inventory write-downs and charges related thereto; market
conditions; success with recovering amounts being written-down for finished
goods inventory; and expansion of the Company's customer base and product
base. Additional forward-looking statements include, but are not limited to,
statements pertaining to other financial items, plans, strategies or
objectives of management for future operations, the Company's future
operations and financial condition or prospects, and any other statement that
is not historical fact, including any statement which is preceded by the words
"forecast," "guidance," "preliminary," "scheduled," "assume," "can," "will,"
"plan," "should," "expect," "estimate," "aim," "intend," "look," "project,"
"foresee," "target," "anticipate," "may," "believe," or similar words. Actual
events or results may differ materially from those stated or implied by the
Company's forward-looking statements as a result of a variety of factors
including the effect of the economy and seasonality on the demand for
electronic devices; the Company's success with new and current customers,
those customers' success in the marketplace and usage of flex in their
products; demand for the Company's products; product mix; the Company's
ability to diversify and expand its customer base and markets; the Company's
effectiveness in managing manufacturing processes, costs and yields; the
ramping and launch of new programs; currency fluctuations; pricing pressure;
the Company's ability to manage quality assurance; Company workforce issues;
the degree to which the Company is able to utilize available manufacturing
capacity, enter into new markets and execute its strategic plans; electricity,
material and component shortages; the impact of natural disasters, competition
and technological advances; the outcome of tax audits; labor issues in the
jurisdictions in which the Company operates; the ability to recover amounts
being written-down for finished goods inventory and other risks detailed from
time to time in the Company's SEC reports, including its Quarterly Report on
Form 10-Q for the quarter ended December 31, 2012. These forward-looking
statements represent management's judgment as of the date of this news
release. The Company disclaims any intent or obligation to update these
forward-looking statements.

Multi-Fineline Electronix, Inc.
Selected Non-GAAP Financial Measures and Schedule Reconciling
Selected Non-GAAP Financial Measures to Comparable GAAP Financial Measures
                                                Three Months Ended
                                                March 31, 2013
GAAP gross margin percentage                    (8.9)%
Effect of finished goods inventory write-down   6.2 %
Non-GAAP gross margin percentage                (2.7)%

Use of Non-GAAP Financial Information

To supplement the condensed consolidated financial results prepared in
accordance with Generally Accepted Accounting Principles ("GAAP"), the Company
uses a non-GAAP financial measure (non-GAAP gross margin) that excludes the
charge to write-down finished goods inventory. Management excludes this item
because it believes that the non-GAAP measure enhances an investor's overall
understanding of the Company's financial performance and future prospects by
being more reflective of the Company's recurring operational activities and to
be more comparable with the results of the Company over various periods.
Management uses non-GAAP financial measures internally for strategic decision
making, forecasting future results and evaluating current performance. By
disclosing non-GAAP financial measures, management intends to provide
investors with a more meaningful, consistent comparison of the Company's core
operating results and trends for the periods presented. Non-GAAP financial
measures are not prepared in accordance with GAAP; therefore, the information
is not necessarily comparable to other companies' financial information and
should be considered as a supplement to, not a substitute for, or superior to,
the corresponding measures calculated in accordance with GAAP.

         Stacy Feit
Contact: Investor Relations
         Tel: 213-486-6549

SOURCE Multi-Fineline Electronix, Inc.

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