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FY03 Second Quarter Results

19 March 2003
St. Petersburg, Florida

Statement of Income and Balance Sheet data for Second Quarter 2003

St. Petersburg, FL - March 19, 2003...Jabil Circuit, Inc. (NYSE: JBL), an electronics manufacturing services provider, today reported results for the second quarter of fiscal 2003, ended February 28, 2003. Revenue for the quarter increased 39 percent to $1.15 billion compared to $0.82 billion for the same period of fiscal 2002.

On a Generally Accepted Accounting Principles (GAAP) basis, net income for the second quarter of fiscal 2003 increased 173 percent to $10.1 million compared to $3.7 million for the same period of fiscal 2002. GAAP diluted earnings per share for the second quarter of fiscal 2003 increased 150 percent to $0.05 compared to $0.02 for the same period of fiscal 2002.

Jabil's second quarter of fiscal 2003 core earnings after taxes increased 113 percent to $32.6 million, compared to $15.3 million for the second quarter of fiscal 2002. (Jabil defines core earnings as GAAP net income before amortization of intangibles, acquisition related charges, restructuring and impairment charges and other income. See the accompanying reconciliation of Jabil's core earnings to its GAAP net income in the supplementary data below.) Core earnings per share increased 100 percent to $0.16 per diluted share for the period, compared to $0.08 for the second quarter of fiscal 2002.

Gross profit for the second quarter of fiscal 2003 increased 43 percent to $104.9 million or 9.2 percent of revenue compared to $73.5 million or 8.9 percent of revenue for the same period of fiscal 2002.

On a GAAP basis, operating income for the second quarter of fiscal 2003 increased 72 percent to $11.6 million compared to $6.7 million for the same period of fiscal 2002.

Core operating income for the second quarter of fiscal 2003 increased 92 percent to $42.1 million or 3.7 percent of revenue compared to $21.9 million or 2.7 percent of revenue for the second quarter of fiscal 2002. (Jabil defines core operating income as GAAP operating income before amortization of intangibles, acquisition related charges and restructuring and impairment charges. See the accompanying reconciliation of Jabil's core operating income to its GAAP operating income in the supplementary data below.)

"In a very tough environment, Jabil has just reported its fourth successive quarter of increasing revenue and operating profits, while maintaining solid balance sheet metrics. This quarter we completed the acquisition of the final three Philips Electronics manufacturing sites, continued our restructuring of worldwide capacity and began numerous new manufacturing programs around the world," said Chris Lewis, Chief Financial Officer.

Income Statement Highlights

  • Second quarter revenue increased seven percent compared to the prior quarter.
  • GAAP operating income increased 305 percent to $11.6 million from the first quarter of fiscal 2003.
  • Core operating income increased eight percent to $42.1 million from the first quarter of fiscal 2003.
  • GAAP earnings were $10.1 million or 0.9 percent of revenue.
  • Core earnings were $32.6 million or 2.8 percent of revenue.
  • Fully diluted GAAP earnings per share for the quarter were $0.05 on 200,726,000 average shares.
  • Fully diluted core earnings per share for the quarter were $0.16 on 200,726,000 average shares.

Sequential Balance Sheet Highlights

  • Inventories increased by $83 million during the quarter to $527 million.
  • Calculated inventory turns were 8, compared to 9 the prior quarter.
  • Sales cycle increased by 6 days to 42.
  • Return on invested capital remained consistent with the prior quarter at 10 percent.
  • Debt-to-capitalization ratio was 23 percent at the end of the quarter, compared to 25 percent at the end of the first quarter of fiscal 2003.
  • Cash flow from operations was approximately $50 million.

Business Outlook Guidance

The company provided guidance for its third fiscal quarter of 2003 indicating it expects revenue to increase sequentially 5 to 8 percent or range from $1.20 billion to $1.24 billion. Jabil said it expects core operating income to increase sequentially 7 to 12 percent resulting in core earnings per share of $0.17 to $0.19 per diluted share, depending upon exact levels of production. GAAP earnings per share are expected to be comparable with the second fiscal quarter of 2003. The Company also noted that its cost reduction activities are on track and reiterated previous estimates that it plans to record $60 to $80 million in restructuring charges over the course of fiscal year 2003.

"Over the past four quarters, we have produced over $4 billion in revenue and $151 million in core operating income," said Tim Main, Jabil's President and CEO. Main said Jabil would remain focused on diversifying and expanding customers and markets served, controlling operating costs and improving financial results. "Step by step, we will concentrate on the execution and expansion of our business to new customers, industry sectors, services and global locations," said Main.

Jabil Circuit, Inc. is one of the world's largest electronic manufacturing services providers. Jabil manufactures for international electronics companies in the automotive, computing and storage, consumer, instrumentation and medical, networking, peripheral and telecommunications markets. Jabil offers circuit design, board design from schematic, prototype assembly, volume board assembly, system assembly, repair and warranty services from facilities in the Americas, Europe and Asia. Further information about Jabil can be found at http://www.jabil.com.