BENCHMARK ELECTRONICS INC [BHE] Filings

10-Q 1 bhe-20230930.htm 10-Q 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________________ to________________

Commission File Number: 1-10560

BENCHMARK ELECTRONICS, INC.

(Exact name of registrant as specified in its charter)


Texas		74-2211011
(State or other jurisdiction		(I.R.S. Employer
of incorporation or organization)		Identification No.)

56 South Rockford Drive		85288
Tempe, Arizona		(Zip Code)
(Address of principal executive offices)

(623) 300-7000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.10 per share	BHE	The New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☑

As of October 30, 2023, there were 35,681,851 shares of common stock of Benchmark Electronics, Inc., par value $0.10 per share, outstanding.

TABLE OF CONTENTS


		Page

PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Income	2
	Condensed Consolidated Statements of Comprehensive Income	3
	Condensed Consolidated Statements of Shareholders’ Equity	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	31

PART II—OTHER INFORMATION

Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	33
Item 5.	Other Information
Item 6.	Exhibits	34

SIGNATURES		35

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

BENCHMARK ELECTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(unaudited)


	September 30,			December 31,
(in thousands, except par value)	2023			2022
Assets
Current assets:
Cash and cash equivalents	$	259,542		$	207,430
Restricted cash		1,218			—
Accounts receivable, net of allowance for doubtful accounts of $960 and $514, respectively		477,685			491,957
Contract assets		190,085			183,613
Inventories		725,349			727,749
Prepaid expenses and other assets		51,838			41,392
Income taxes receivable		1,352			8
Total current assets		1,707,069			1,652,149
Property, plant and equipment, net		231,661			211,478
Operating lease right-of-use assets		122,104			93,081
Goodwill		192,116			192,116
Deferred income taxes		16,190			12,235
Other assets, net		64,005			66,272
	$	2,333,145		$	2,227,331
Liabilities and Shareholders’ Equity
Current liabilities:
Current installments of long-term debt	$	4,281		$	4,275
Accounts payable		382,170			424,272
Advance payments from customers		189,058			197,937
Income taxes payable		12,823			12,236
Accrued liabilities		110,772			110,416
Total current liabilities		699,104			749,136
Long-term debt, less current installments		428,231			320,675
Operating lease liabilities		114,279			86,687
Other long-term liabilities		27,987			43,922
Deferred income taxes		495			495
Commitments and contingencies
Shareholders’ equity:
Preferred stock, $0.10 par value; 5,000 shares authorized, none issued		—			—
Common stock, $0.10 par value; 145,000 shares authorized; issued and outstanding – 35,653 and 35,164, respectively		3,565			3,516
Additional paid-in capital		525,784			519,238
Retained earnings		548,874			519,895
Accumulated other comprehensive loss		(15,174	)		(16,233	)
Total shareholders’ equity		1,063,049			1,026,416
	$	2,333,145		$	2,227,331

See accompanying notes to unaudited interim condensed consolidated financial statements.

BENCHMARK ELECTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Income

(unaudited)


	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except per share data)	2023			2022			2023			2022
Sales	$	719,695		$	771,575		$	2,147,622		$	2,135,687
Cost of sales		650,618			704,825			1,947,556			1,952,579
Gross profit		69,077			66,750			200,066			183,108
Selling, general and administrative expenses		35,509			38,544			111,379			110,675
Amortization of intangible assets		1,592			1,591			4,775			4,792
Restructuring charges and other costs		1,635			1,331			6,348			4,518
Income from operations		30,341			25,284			77,564			63,123
Interest expense		(8,475	)		(3,493	)		(23,183	)		(7,428	)
Interest income		1,343			452			4,223			843
Other income, net		2,384			1,087			280			1,577
Income before income taxes		25,593			23,330			58,884			58,115
Income tax expense		5,181			4,501			12,121			11,105
Net income	$	20,412		$	18,829		$	46,763		$	47,010
Earnings per share:
Basic	$	0.57		$	0.54		$	1.32		$	1.34
Diluted	$	0.57		$	0.53		$	1.30		$	1.32
Weighted-average number of shares outstanding:
Basic		35,647			35,151			35,535			35,184
Diluted		35,876			35,348			35,879			35,604

See accompanying notes to unaudited interim condensed consolidated financial statements.

BENCHMARK ELECTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income

(unaudited)


	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2023			2022			2023			2022
Net income	$	20,412		$	18,829		$	46,763		$	47,010
Other comprehensive income (loss):
Foreign currency translation adjustments		(1,891	)		(3,541	)		(786	)		(8,197	)
Unrealized gain (loss) on derivatives, net of tax		(621	)		730			1,523			4,293
Other		(110	)		(22	)		322			(63	)
Other comprehensive income (loss)		(2,622	)		(2,833	)		1,059			(3,967	)
Comprehensive income	$	17,790		$	15,996		$	47,822		$	43,043

See accompanying notes to unaudited interim condensed consolidated financial statements.

BENCHMARK ELECTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Shareholders’ Equity

(unaudited)


(in thousands)	Shares			Common Stock			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total Shareholders’ Equity
Balances, December 31, 2022		35,164		$	3,516		$	519,238		$	519,895		$	(16,233	)	$	1,026,416
Stock-based compensation expense		—			—			12,331			—			—			12,331
Stock options exercised		5			1			67			—			—			68
Vesting of restricted stock units		721			72			(72	)		—			—			—
Shares withheld for taxes		(237	)		(24	)		(5,780	)		—			—			(5,804	)
Dividends declared		—			—			—			(17,784	)		—			(17,784	)
Net income		—			—			—			46,763			—			46,763
Other comprehensive income		—			—			—			—			1,059			1,059
Balances, September 30, 2023		35,653		$	3,565		$	525,784		$	548,874		$	(15,174	)	$	1,063,049

Balances, June 30, 2023		35,642		$	3,564		$	522,247		$	534,470		$	(12,552	)	$	1,047,729
Stock-based compensation expense		—			—			3,674			—			—			3,674
Vesting of restricted stock units		16			2			(2	)		—			—			—
Shares withheld for taxes		(5	)		(1	)		(135	)		—			—			(136	)
Dividends declared		—			—			—			(6,008	)		—			(6,008	)
Net income		—			—			—			20,412			—			20,412
Other comprehensive loss		—			—			—			—			(2,622	)		(2,622	)
Balances, September 30, 2023		35,653		$	3,565		$	525,784		$	548,874		$	(15,174	)	$	1,063,049


(in thousands)	Shares			Common Stock			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total Shareholders’ Equity
Balances, December 31, 2021		35,213		$	3,521		$	507,447		$	479,992		$	(17,158	)	$	973,802
Stock-based compensation expense		—			—			13,282			—			—			13,282
Shares repurchased and retired		(376	)		(37	)		(4,177	)		(5,177	)		—			(9,391	)
Stock options exercised		33			3			468			—			—			471
Vesting of restricted stock units		407			41			(41	)		—			—			—
Shares withheld for taxes		(124	)		(13	)		(3,171	)		—			—			(3,184	)
Dividends declared		—			—			—			(17,406	)		—			(17,406	)
Net income		—			—			—			47,010			—			47,010
Other comprehensive loss		—			—			—			—			(3,967	)		(3,967	)
Balances, September 30, 2022		35,153		$	3,515		$	513,808		$	504,419		$	(21,125	)	$	1,000,617

Balances, June 30, 2022		35,140		$	3,514		$	509,172		$	491,379		$	(18,292	)	$	985,773
Stock-based compensation expense		—			—			4,795			—			—			4,795
Stock options exercised		1			—			12			—			—			12
Vesting of restricted stock units		18			2			(2	)		—			—			—
Shares withheld for taxes		(6	)		(1	)		(169	)		—			—			(170	)
Dividends declared		—			—			—			(5,789	)		—			(5,789	)
Net income		—			—			—			18,829			—			18,829
Other comprehensive loss		—			—			—			—			(2,833	)		(2,833	)
Balances, September 30, 2022

BENCHMARK ELECTRONICS INC [BHE] Filings
10-Q	[2023-11-02]
10-Q	[2023-08-03]
10-Q	[2023-05-05]
10-K	[2023-02-24]
10-Q	[2022-11-04]
10-Q	[2022-08-04]
10-Q	[2022-05-05]
10-K	[2022-02-25]
10-Q	[2021-11-04]
10-Q	[2021-08-05]
10-Q	[2021-05-06]
10-K	[2021-03-01]
10-Q	[2020-11-05]
10-Q	[2020-08-06]
10-Q	[2020-05-08]
10-K	[2020-03-02]
10-Q	[2019-11-06]
10-Q	[2019-08-08]
10-Q	[2019-05-08]
10-K	[2019-02-28]
10-Q	[2018-11-08]
10-Q	[2018-08-08]
10-Q	[2018-05-09]
10-K	[2018-03-01]
10-Q	[2017-11-08]
10-Q	[2017-08-08]
10-Q	[2017-05-09]
10-K	[2017-02-28]
10-Q	[2016-11-08]
10-Q	[2016-08-08]
10-Q	[2016-05-10]
10-K	[2016-02-29]
10-Q	[2015-11-06]
10-Q	[2015-08-07]
10-Q	[2015-05-08]
10-K	[2015-02-27]
10-Q	[2014-11-07]
10-Q	[2014-08-06]
10-Q	[2014-05-09]
10-K	[2014-02-28]
10-Q	[2013-11-08]
10-Q	[2013-08-07]
10-Q	[2013-05-08]
10-K	[2013-02-28]
10-Q	[2012-11-08]
10-Q	[2012-08-08]
10-Q	[2012-05-08]
10-K	[2012-02-29]