Plexus Announces Fiscal First Quarter Financial Results

NEENAH, Wis.— Plexus (NASDAQ: PLXS)  announced financial results for our fiscal first quarter ended January 2, 2021, and guidance for our fiscal second quarter ending April 3, 2021.

			Three Months Ended
			Jan 2, 2021					Jan 2, 2021		Apr 3, 2021
			Q1F21 Results					Q1F21 Guidance		Q2F21 Guidance
Summary GAAP Items
Revenue (in millions)			$830					$810 to $850		$860 to $900
Operating margin			5.6%					4.9% to 5.3%		5.0% to 5.5%
Diluted EPS (1)			$1.23					$1.02 to $1.17		$1.17 to $1.32
Summary Non-GAAP Items (2)
Return on invested capital (ROIC)			16.3%
Economic return			8.2%
(1) Includes stock-based compensation expense of $0.18 for Q1F21 results, $0.19 for Q1F21 guidance and $0.22 for Q2F21 guidance.
(2) Refer to Non-GAAP Supplemental Information in Tables 1 and 2 for non-GAAP financial measures and a reconciliation to GAAP.

Fiscal First Quarter 2021 Information

• Won 35 manufacturing programs during the quarter representing $223 million in annualized revenue when fully ramped into production
• Trailing four quarter wins total a record $1 billion in annualized revenue when fully ramped into production
• Purchased $22.8 million of our shares at an average price of $74.16 per share under our existing share repurchase programs. There remains $82.6 million outstanding of the $100 million that was authorized under the fiscal 2021 program.

Todd Kelsey, President and CEO, commented, “Our operations achieved strong results in the fiscal first quarter. We expanded GAAP operating margin to 5.6% through our focus on productivity improvements and expense management along with solid performance from our Engineering Solutions team.   This operating margin represents the third consecutive quarter in excess of 5.0%. Revenue of $830 million was in line with our expectations and at the midpoint of our guidance. Through this combination, we delivered GAAP diluted earnings per share of $1.23, which was well above the top end of our guidance range.”

Mr. Kelsey continued, “Our go-to-market team’s sustained focus on leveraging our exceptional execution to drive new business development opportunities produced strong results again this past quarter. Within the fiscal first quarter, Plexus won 35 new programs including a meaningful number of new customer engagements. These wins represent $223 million in annualized revenue when fully ramped into production and contribute to our trailing four quarter wins total of a record $1.0 billion. In addition, we expanded Plexus’ funnel of qualified manufacturing opportunities by nearly $600 million from the prior quarter to a record $3.3 billion. This healthy rate of new program wins and the considerable expansion in the funnel of qualified opportunities should position us well to achieve our 9% to 12% revenue CAGR goal over the longer term.”

Patrick Jermain, Executive Vice President and CFO, commented, “With our exceptional operating performance, we delivered return on invested capital of 16.3%, sequentially improved by 230 basis points and the highest return delivered in more than three years. This result generated economic return of 820 basis points above our weighted average cost of capital, creating substantial shareholder value. Further, we continue to maintain a solid balance sheet. We ended the quarter with cash in excess of $350 million and no outstanding borrowing under our revolving credit facility while investing in working capital, capital expenditures and our share repurchase program. We reconfirm our fiscal 2021 expectation for free cash flow of approximately $100 million.”

Mr. Kelsey concluded, “We anticipate a robust fiscal second quarter due to expected increases in medical equipment demand, recent strengthening in our Industrial Sector and sustained operational excellence. We are guiding revenue of $860 to $900 million, GAAP operating margin in the range of 5.0% to 5.5% and GAAP diluted earnings per share of $1.17 to $1.32. Our guidance assumes that COVID-19 will not materially impact end markets or our operations beyond what has already occurred. Long-term visibility into end markets remains limited, yet our history of strong execution provides the opportunity to continue to capture potential upside demand that may arise. Looking to the second half of fiscal 2021, while we currently anticipate revenue relatively consistent with the fiscal second quarter guidance and operating margin to moderate from the fiscal first quarter result, we believe Plexus is positioned to drive strong EPS growth for fiscal 2021.”