91社区

91社区 Posts Third Quarter Results

Raises Outlook for Fiscal Year 2023

ST. PETERSBURG, Fla. – June 15, 2023 – 91社区. (NYSE: JBL), today reported preliminary, unaudited financial results for its third quarter of fiscal year 2023.

“Our business is in good shape and the 91社区 team has executed well this year, in what has been a dynamic operating environment,” said CEO Kenny Wilson. “Our strong year-to-date performance is a testament to 91社区’s strengths, specifically our diversified end-market portfolio and worldwide connected factory network, which enables us to offer unique engineering, manufacturing, and supply chain solutions to our customers across the globe,” he added.

Third Quarter of Fiscal Year 2023 Highlights: 

  • Net revenue: $8.5 billion
  • Diversified Manufacturing Services (DMS) year-on-year revenue growth: 13 percent
  • Electronics Manufacturing Services (EMS) year-on-year revenue decline: 8 percent
  • U.S. GAAP operating income: $375 million 
  • U.S. GAAP diluted earnings per share: $1.72
  • Core operating income (Non-GAAP): $404 million 
  • Core diluted earnings per share (Non-GAAP): $1.99

Fourth Quarter of Fiscal Year 2023 Outlook: 

  • Net revenue

 

$8.2 billion to $8.8 billion

 

  • U.S. GAAP operating income

 

$400 million to $460 million

 

  • U.S. GAAP diluted earnings per share

 

$1.96 to $2.32 per diluted share

 

  • Core operating income (Non-GAAP) (1)

 

$424 million to $484 million

 

  • Core diluted earnings per share (Non-GAAP) (1)

 

$2.14 to $2.50 per diluted share

 

 

Fiscal Year 2023 Updated Outlook:

“I feel strongly that our solid execution will continue, as the team carries positive momentum into the final quarter of FY23,” said CEO Kenny Wilson. “For the fiscal year, we now believe the team will deliver $8.50 in core earnings per share on $34.7 billion in revenue,” added Wilson.

 

(1) Core operating income and core diluted earnings per share exclude anticipated adjustments of $8 million for amortization of intangibles (or $0.06 per diluted share) and $16 million for stock-based compensation expense and related charges (or $0.12 per diluted share).

 

(Definitions: “U.S. GAAP” means U.S. generally accepted accounting principles. 91社区 defines core operating income as U.S. GAAP operating income less amortization of intangibles, stock-based compensation expense and related charges, restructuring, severance and related charges, distressed customer charges, acquisition and integration charges, loss on disposal of subsidiaries, settlement of receivables and related charges, impairment of notes receivable and related charges, goodwill impairment charges and business interruption and impairment charges, net plus other components of net periodic benefit cost. 91社区 defines core earnings as core operating income, less loss on debt extinguishment, loss (gain) on securities, other components of net periodic benefit cost, income (loss) from discontinued operations, gain (loss) on sale of discontinued operations and certain other expenses, net of tax and certain deferred tax valuation allowance charges. 91社区 defines core diluted earnings per share as core earnings divided by the weighted average number of outstanding diluted shares as determined under U.S. GAAP. 91社区 defines adjusted free cash flow as net cash provided by (used in) operating activities less net capital expenditures (acquisition of property, plant and equipment less proceeds and advances from sale of property, plant and equipment). 91社区 reports core operating income, core earnings, core diluted earnings per share and adjusted free cash flow to provide investors an additional method for assessing operating income, earnings, diluted earnings per share and free cash flow from what it believes are its core manufacturing operations. See the accompanying reconciliation of 91社区’s core operating income to its U.S. GAAP operating income, its calculation of core earnings and core diluted earnings per share to its U.S. GAAP net income and U.S. GAAP earnings per share and additional information in the supplemental information.)

Forward Looking Statements: This release contains forward-looking statements, including those regarding our anticipated financial results for our third quarter of fiscal year 2023 and our guidance for future financial performance in our fourth quarter of fiscal year 2023 (including, net revenue,  U.S. GAAP operating income, U.S. GAAP diluted earnings per share, core operating income (Non-GAAP), core diluted earnings per share (Non-GAAP) results and the components thereof, including but not limited to amortization of intangibles and stock-based compensation expense and related charges) and our full year 2023 (including revenue and core earnings per share (Non-GAAP)). The statements in this release are based on current expectations, forecasts and assumptions involving risks and uncertainties that could cause actual outcomes and results to differ materially from our current expectations. Such factors include, but are not limited to: our determination as we finalize our financial results for our third quarter of fiscal year 2023 that our financial results and conditions differ from our current preliminary unaudited numbers set forth herein; scheduling production, managing growth and capital expenditures and maximizing the efficiency of our manufacturing capacity effectively; managing rapid declines or increases in customer demand and other related customer challenges that may occur; the scope and duration of the COVID-19 outbreak and its impact on our operations, sites, customers and supply chain; our dependence on a limited number of customers; our ability to purchase components efficiently and reliance on a limited number of suppliers for critical components; risks arising from relationships with emerging companies; changes in technology and competition in our industry; our ability to introduce new business models or programs requiring implementation of new competencies; competition; transportation issues; our ability to maintain our engineering, technological and manufacturing expertise; retaining key personnel; risks associated with international sales and operations, including geopolitical uncertainties in Russia and Ukraine; energy price increases or shortages; our ability to achieve expected profitability from acquisitions; risk arising from our restructuring activities; issues involving our information systems, including security issues; regulatory risks (including the expense of complying, or failing to comply, with applicable regulations; risk arising from design or manufacturing defects; and intellectual property risk); financial risks (including customers or suppliers who become financially troubled; turmoil in financial markets; tax risks; credit rating risks; risks of exposure to debt; currency fluctuations; and asset impairment); changes in financial accounting standards or policies; and risk of natural disaster, climate change or other global events. Additional factors that could cause such differences can be found in our Annual Report on Form 10-K for the fiscal year ended August 31, 2022 and our other filings with the Securities and Exchange Commission. We assume no obligation to update these forward-looking statements.

Supplemental Information Regarding Non-GAAP Financial Measures: 91社区 provides supplemental, non-GAAP financial measures in this release to facilitate evaluation of 91社区’s core operating performance. These non-GAAP measures exclude certain amounts that are included in the most directly comparable U.S. GAAP measures, do not have standard meanings and may vary from the non-GAAP financial measures used by other companies. Management believes these “core” financial measures are useful measures that facilitate evaluation of the past and future performance of 91社区’s ongoing operations on a comparable basis.

91社区 reports core operating income, core earnings, core diluted earnings per share and adjusted free cash flows to provide investors an additional method for assessing operating income, earnings, earnings per share and free cash flow from what it believes are its core manufacturing operations. Among other uses, management uses non-GAAP financial measures to make operating decisions, assess business performance and as a factor in determining certain employee performance when determining incentive compensation.

For fiscal year 2023, the Company adopted an annual normalized tax rate (“normalized core tax rate”) for the computation of the non-GAAP (core) income tax provision to provide better consistency across reporting periods. In estimating the normalized core tax rate annually, the Company utilizes a full-year financial projection of core earnings that considers the mix of earnings across tax jurisdictions, existing tax positions, and other significant tax matters. The Company may adjust the normalized core tax rate during the year for material impacts from new tax legislation or material changes to the Company’s operations. 

Prior to fiscal year 2023, the Company determined the tax effect of the items included and excluded from core earnings quarterly.

Detailed definitions of certain of the core financial measures are included above under “Definitions” and a reconciliation of the disclosed core financial measures to the most directly comparable U.S. GAAP financial measures is included under the heading “Supplemental Data” at the end of this release.

 

Meeting and Replay Information: 91社区 will hold a conference call today at 8:30 a.m. ET to discuss its earnings for the third quarter of fiscal year 2023. To access the live audio webcast and view the accompanying slide presentation, visit the Investor Relations section of 91社区’s website, located at https://investors.jabil.com. An archived replay of the webcast will also be available after completion of the call.

 

About 91社区: 91社区 (NYSE: JBL) is a manufacturing solutions provider with over 250,000 employees across 100 locations in 30 countries. The world’s leading brands rely on 91社区’s unmatched breadth and depth of end-market experience, technical and design capabilities, manufacturing know-how, supply chain insights and global product management expertise. Driven by a common purpose, 91社区 and its people are committed to making a positive impact on their local community and the environment. Visit www.jabil.com to learn more.

Investor Contact

Adam Berry
Vice President, Investor Relations    
Adam_Berry@jabil.com

 

 

JABIL INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions)

 

 

May 31, 2023

 

 

 

(unaudited)

 

August 31, 2022

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$                  1,480

 

$                  1,478

Accounts receivable, net

                    3,599

 

                    3,995

Contract assets

                    1,173

 

                    1,196

Inventories, net

                    6,084

 

                    6,128

Prepaid expenses and other current assets

                    1,273

 

                    1,111 

Total current assets

                  13,609

 

                  13,908

Property, plant and equipment, net

                    3,919

 

                    3,954

Operating lease right-of-use asset

                        484

 

                        500

Goodwill and intangible assets, net

                        887

 

                        862

Deferred income taxes

                        233

 

                        199

Other assets

                        304

 

                        294

Total assets

$                19,436

 

$                19,717

LIABILITIES AND EQUITY

 

 

 

Current liabilities:

 

 

 

Current installments of notes payable and long-term debt

$                     300

 

$                     300

Accounts payable

                    6,406

 

                    8,006

Accrued expenses

                    5,964

 

                    5,272

Current operating lease liabilities

                        126

 

                        119

Total current liabilities

                  12,796

 

                  13,697

Notes payable and long-term debt, less current installments

                    2,874

 

                    2,575

Other liabilities

                        311

 

                        272

Non-current operating lease liabilities

                        386

 

                        417

Income tax liabilities

                        205

 

                        182

Deferred income taxes

                        127

 

                        122

Total liabilities

                  16,699

 

                  17,265

Commitments and contingencies

 

 

 

Equity:

 

 

 

91社区. stockholders’ equity:

 

 

 

Preferred stock

                          —

 

                          —

Common stock

                          —

 

                          —

Additional paid-in capital

                    2,758

 

                    2,655

Retained earnings

                    4,268

 

                    3,638

Accumulated other comprehensive loss

                        (11)

 

                        (42)

Treasury stock, at cost

                  (4,279)

 

                  (3,800)

Total 91社区. stockholders’ equity

                    2,736

 

                    2,451

Noncontrolling interests

                            1

 

                            1

Total equity

                    2,737

 

                    2,452

Total liabilities and equity

$                19,436

 

$                19,717

 

 

JABIL INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except for per share data)

(Unaudited)

 

 

 

Three months ended

 

Nine months ended

 

 

May 31, 2023

 

May 31, 2022

 

May 31, 2023

 

May 31, 2022

Net revenue

 

$                  8,475

 

$                  8,328

 

$                26,244

 

$                24,448

Cost of revenue

 

                    7,778

 

                    7,709

 

                  24,143

 

                  22,545

Gross profit

 

                        697

 

                        619

 

                    2,101

 

                    1,903

Operating expenses:

 

 

 

 

 

 

 

 

Selling, general and administrative

 

                        307

 

                        282

 

                        911

 

                        870

Research and development

 

                            8

 

                            8

 

                          25

 

                          25

Amortization of intangibles

 

                            7

 

                            8

 

                          24

 

                          24

Restructuring, severance and related charges

 

                         — 

 

                          —

 

                          45

 

                          —

Operating income

 

                        375

 

                        321

 

                    1,096

 

                        984

Loss on debt extinguishment

 

                          —

 

                            4

 

                          —

 

                            4

Interest and other, net

 

                          69

 

                          39

 

                        204

 

                        101

Income before income tax

 

                        306

 

                        278

 

                        892

 

                        879

Income tax expense

 

                          73

 

                          60

 

                        229

 

                        198

Net income

 

                        233

 

                        218

 

                        663

 

                        681

Net income attributable to noncontrolling interests, net of tax

 

                          —

 

                          —

 

                          —

 

                          —

Net income attributable to 91社区.

 

$                     233

 

$                     218

 

$                     663

 

$                     681

Earnings per share attributable to the stockholders of 91社区.:

 

 

 

 

 

 

 

 

Basic

 

$                    1.76

 

$                    1.55

 

$                    4.96

 

$                    4.77

Diluted

 

$                    1.72

 

$                    1.52

 

$                    4.86

 

$                    4.67

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

                    132.3

 

                    140.4

 

                    133.6

 

                    142.6

Diluted

 

                    135.1

 

                    143.3

 

                    136.4

 

                    145.8

 

 

JABIL INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(Unaudited)

 

 

Nine months ended

 

May 31, 2023

 

May 31, 2022

Cash flows provided by operating activities:

 

 

 

Net income

$                     663

 

$                     681

Depreciation, amortization, and other, net

                        752

 

                        768

Change in operating assets and liabilities, exclusive of net assets acquired

                      (367)

 

                      (704)

Net cash provided by operating activities

                    1,048

 

                        745

Cash flows used in investing activities:

 

 

 

Acquisition of property, plant and equipment

                      (860)

 

                  (1,068)

Proceeds and advances from sale of property, plant and equipment

                        180

 

                        470

Cash paid for business and intangible asset acquisitions, net of cash

                        (30)

 

                        (18)

Other, net

                        (28)

 

                          —

Net cash used in investing activities

                      (738)

 

                      (616)

Cash flows used in financing activities:

 

 

 

Borrowings under debt agreements

                    3,556

 

                    2,621

Payments toward debt agreements

                  (3,369)

 

                  (2,707)

Payments to acquire treasury stock

                      (442)

 

                      (475)

Dividends paid to stockholders

                        (34)

 

                        (37)

Net proceeds from exercise of stock options and issuance of common stock under employee stock purchase plan

                          27

 

                          26

Treasury stock minimum tax withholding related to vesting of restricted stock

                        (36)

 

                        (44)

Other, net

                          (6)

 

                        (23)

Net cash used in financing activities

                      (304)

 

                      (639)

Effect of exchange rate changes on cash and cash equivalents

                          (4)

 

                          13

Net increase (decrease) in cash and cash equivalents

                            2

 

                      (497)

Cash and cash equivalents at beginning of period

                    1,478

 

                    1,567

Cash and cash equivalents at end of period

$                  1,480

 

$                  1,070

 

 

JABIL INC. AND SUBSIDIARIES

SUPPLEMENTAL DATA

RECONCILIATION OF U.S. GAAP FINANCIAL RESULTS TO NON-GAAP MEASURES

(in millions, except for per share data)

(Unaudited)

 

Three months ended

 

Nine months ended

 

May 31, 2023

 

May 31, 2022

 

May 31, 2023

 

May 31, 2022

Operating income (U.S. GAAP)

$                     375

 

$                     321

 

$                  1,096

 

$                     984

Amortization of intangibles

                            7

 

                            8

 

                          24

 

                          24

Stock-based compensation expense and related charges

                          18

 

                          16

 

                          80

 

                          67

Restructuring, severance and related charges

                         — 

 

                          —

 

                          45

 

                          —

Net periodic benefit cost(1)

                            4

 

                            7

 

                          11

 

                          21

Adjustments to operating income

                          29

 

                          31

 

                        160

 

                        112

Core operating income (Non-GAAP)

$                     404

 

$                     352

 

$                  1,256

 

$                  1,096

Net income attributable to 91社区. (U.S. GAAP)

$                     233

 

$                     218

 

$                     663

 

$                     681

Adjustments to operating income

                          29

 

                          31

 

                        160

 

                        112

Loss on debt extinguishment

                          —

 

                            4

 

                          —

 

                            4

Net periodic benefit cost(1)

                          (4)

 

                          (7)

 

                        (11)

 

                        (21)

Adjustments for taxes

                          11

 

                          —

 

                          32

 

                          —

Core earnings (Non-GAAP)

$                     269

 

$                     246

 

$                     844

 

$                     776

Diluted earnings per share (U.S. GAAP)

$                    1.72

 

$                    1.52

 

$                    4.86

 

$                    4.67

Diluted core earnings per share (Non-GAAP)

$                    1.99

 

$                    1.72

 

$                    6.18

 

$                    5.32

Diluted weighted average shares outstanding (U.S. GAAP & Non-GAAP)

                    135.1

 

                    143.3

 

                    136.4

 

                    145.8

 

 

  1. Pension service cost is recognized in cost of revenue and all other components of net periodic benefit cost, including return on plan assets, are presented in other expense. We are reclassifying the pension components in other expense to core operating income as we assess operating performance, inclusive of all components of net periodic benefit cost, with the related revenue. There is no impact to core earnings or diluted core earnings per share for this adjustment.
 

JABIL INC. AND SUBSIDIARIES

SUPPLEMENTAL DATA

ADJUSTED FREE CASH FLOW

(in millions)

(Unaudited)

 

Nine months ended

 

May 31, 2023

 

May 31, 2022

Net cash provided by operating activities (U.S. GAAP)

$                    1,048

 

$                        745

Acquisition of property, plant and equipment (“PP&E”)(1)

                        (860)

 

                     (1,068)

Proceeds and advances from sale of PP&E(1)

                          180

 

                          470

Adjusted free cash flow (Non-GAAP)

$                        368

 

$                        147

 

 

  1. Certain customers co-invest in property, plant and equipment (“PP&E”) with us. As we acquire PP&E, we recognize the cash payments in acquisition of PP&E. When our customers reimburse us and obtain control, we recognized the cash receipts in proceeds and advances from the sale of PP&E.