NEENAH, WI, Jan. 22, 2025 (GLOBE NEWSWIRE) -- Plexus Corp. (NASDAQ: PLXS) today announced financial results for our fiscal first quarter ended December 28, 2024, and guidance for our fiscal second quarter ending March 29, 2025.

• Reports fiscal first quarter 2025 revenue of $976 million, GAAP operating margin of 4.8% and GAAP diluted EPS of $1.34.

• Reports fiscal first quarter 2025 non-GAAP operating margin of 6.0% and non-GAAP diluted EPS of $1.73, excluding $0.24 of stock-based compensation expense and $0.15 of restructuring and other charges, net of tax.

• Initiates fiscal second quarter 2025 revenue guidance of $960 million to $1.00 billion with GAAP diluted EPS of $1.22 to $1.37, including $0.24 of stock-based compensation expense. Fiscal second quarter non-GAAP EPS guidance of $1.46 to $1.61 excludes stock-based compensation expense.

Fiscal First Quarter 2025 Information

• Won 30 manufacturing programs during the quarter representing $212 million in annualized revenue when fully ramped into production.

• Generated fiscal first quarter free cash flow of $27 million.

• Purchased $12.8 million of our shares at an average price of $151.19 per share under our 2025 Share Repurchase Program, leaving $37.2 million available under our existing $50.0 million authorization.

Todd Kelsey, President and Chief Executive Officer, commented, "Our team's agility and responsiveness enabled strong operating performance in the fiscal first quarter, resulting in robust financial results to begin fiscal 2025. We delivered fiscal first quarter revenue of $976 million, in-line with expectations, and non-GAAP operating margin of 6.0%, near the high end of our guidance and consistent with our long-term goal. This contributed to non-GAAP EPS of $1.73, which exceeded guidance. Furthermore, free cash flow generation surpassed expectations, benefiting from the ongoing efforts of our fiscal 2024 initiatives to drive sustained improvement in working capital efficiency."

Patrick Jermain, Executive Vice President and Chief Financial Officer, commented, "Aided by a cash cycle of 68 days, 5 days favorable to expectations, we delivered our best fiscal first quarter free cash flow performance in five years, generating $27 million. The ongoing improvements in our cash cycle also continue to benefit return on invested capital, which was 13.8% for the fiscal first quarter, or 490 basis points above our weighted average cost of capital. Although net working capital investments in support of program ramps are anticipated for the fiscal second quarter, our robust fiscal first quarter free cash generation positions us to now deliver up to $100 million of free cash for fiscal 2025. Finally, reinforcing our commitment to create additional shareholder value, we reduced our borrowing by $37 million and repurchased $13 million of our shares during the fiscal first quarter."

Mr. Kelsey continued, "We delivered 30 fiscal first quarter manufacturing wins, representing $212 million in annualized revenue. The wins performance reflects continued strong contribution within our Healthcare/Life Sciences market sector as well as exciting growth opportunities within our Aerospace/Defense and Industrial market sectors. In addition, our engineering solutions team delivered a win total that approached a two-year high, while our funnel of engineering opportunities continues to see increased diversification. We believe both are strong leading indicators of future Plexus revenue growth."

Mr. Kelsey concluded, "Considering current market sector dynamics and typical seasonal cost pressures, we are guiding to fiscal second quarter revenue of $960 million to $1.00 billion, non-GAAP operating margin of 5.3% to 5.7% and non-GAAP EPS of $1.46 to $1.61. Lastly, we remain confident in achieving meaningful EPS growth in fiscal 2025 by leveraging revenue expansion in each of our market sectors, ongoing strong operating margin performance and continued deployment of our free cash flow to create additional shareholder value."

Business Segment and Market Sector Revenue

Plexus measures operational performance and allocates resources on a geographic segment basis. Plexus also reports revenue based on the market sector breakout set forth in the table below, which reflects Plexus’ market sector focused strategy. Top 10 customers comprised 51% of revenue during the first quarter of fiscal 2025. This is down 1 percentage point from the fourth quarter of fiscal 2024 and up 3 percentage points from the first quarter of fiscal 2024.

Non-GAAP Supplemental Information

Plexus provides non-GAAP supplemental information, such as ROIC, economic return and free cash flow, because such measures are used for internal management goals and decision-making, and because they provide management and investors with additional insight into financial performance. In addition, management uses these and other non-GAAP measures, such as adjusted operating income, adjusted operating margin, adjusted net income and adjusted diluted EPS, to provide a better understanding of core performance for purposes of period-to-period comparisons. Plexus believes that these measures are also useful to investors because they provide further insight by eliminating the effect of non-recurring items that are not reflective of continuing operations. For additional information on non-GAAP measures, please refer to the attached Non-GAAP Supplemental Information tables.

ROIC and Economic Return

ROIC for the first quarter of fiscal 2025 was 13.8%. Plexus defines ROIC as tax-effected annualized adjusted operating income divided by average invested capital over a two-quarter period for the first fiscal quarter. Invested capital is defined as equity plus debt and operating lease obligations, less cash and cash equivalents. Plexus' weighted average cost of capital for fiscal 2025 is 8.9%. ROIC for the first quarter of fiscal 2025 less Plexus’ weighted average cost of capital resulted in an economic return of 4.9%.

Free Cash Flow

Plexus defines free cash flow as cash flows provided by operations less capital expenditures. For the three months ended December 28, 2024, cash flows provided by operations was $53.6 million, less capital expenditures of $26.5 million, resulting in free cash flow of $27.1 million.

Conference Call and Webcast Information

Investor and Media Contact
Shawn Harrison
+1.920.969.6325
shawn.harrison@plexus.com

About Plexus
Since 1979, Plexus has helped create the products that build a better world. Driven by a passion for excellence, we partner with our customers to design, manufacture and service highly complex products in demanding regulatory environments. From life-saving medical devices and mission-critical aerospace and defense products to industrial automation systems and semiconductor capital equipment, our innovative solutions across the lifecycle of a product converge where advanced technology and human impact intersect. We provide these solutions to market-leading as well as disruptive global companies in the Aerospace/Defense, Healthcare/Life Sciences, and Industrial sectors, supported by a global team of over 20,000 members across our 26 facilities in the Americas ("AMER"), Asia-Pacific ("APAC") and Europe, Middle East and Africa ("EMEA") regions. For more information about Plexus, visit our website at www.plexus.com.

Safe Harbor and Fair Disclosure Statement
The statements contained in this press release that are guidance or which are not historical facts (such as statements in the future tense and statements including believe, expect, intend, plan, anticipate, goal, target and similar terms and concepts), including all discussions of periods which are not yet completed, are forward-looking statements that involve risks and uncertainties. These risks and uncertainties include the effect of inflationary pressures on our costs of production, profitability, and on the economic outlook of our markets; the effects of shortages and delays in obtaining components as a result of economic cycles, natural disasters or otherwise; the risk of customer delays, changes, cancellations or forecast inaccuracies in both ongoing and new programs; the ability to realize anticipated savings from restructuring or similar actions, as well as the adequacy of related charges as compared to actual expenses; the lack of visibility of future orders, particularly in view of changing economic conditions; the economic performance of the industries, sectors and customers we serve; the outcome of litigation and regulatory investigations and proceedings, including the results of any challenges with regard to such outcomes; the effects of tariffs, trade disputes, trade agreements and other trade protection measures; the effects of the volume of revenue from certain sectors or programs on our margins in particular periods; our ability to secure new customers, maintain our current customer base and deliver product on a timely basis; the risks of concentration of work for certain customers; the particular risks relative to new or recent customers, programs or services, which risks include customer and other delays, start-up costs, potential inability to execute, the establishment of appropriate terms of agreements, and the lack of a track record of order volume and timing; the effects of start-up costs of new programs and facilities or the costs associated with the closure or consolidation of facilities; possible unexpected costs and operating disruption in transitioning programs, including transitions between Company facilities; the risk that new program wins and/or customer demand may not result in the expected revenue or profitability; the fact that customer orders may not lead to long-term relationships; our ability to manage successfully and execute a complex business model characterized by high product mix and demanding quality, regulatory, and other requirements; the risks associated with excess and obsolete inventory, including the risk that inventory purchased on behalf of our customers may not be consumed or otherwise paid for by the customer, resulting in an inventory write-off; risks related to information technology systems and data security; increasing regulatory and compliance requirements; any tax law changes and related foreign jurisdiction tax developments; current or potential future barriers to the repatriation of funds that are currently held outside of the United States as a result of actions taken by other countries or otherwise; the potential effects of jurisdictional results on our taxes, tax rates, and our ability to use deferred tax assets and net operating losses; the weakness of areas of the global economy; the effect of changes in the pricing and margins of products; raw materials and component cost fluctuations; the potential effect of fluctuations in the value of the currencies in which we transact business; the effects of changes in economic conditions, political conditions and regulatory matters in the United States and in the other countries in which we do business; the potential effect of other world or local events or other events outside our control (such as the conflict between Russia and Ukraine, conflict in the Middle East, escalating tensions between China and Taiwan or China and the United States, changes in energy prices, terrorism, global health epidemics and weather events); the impact of increased competition; an inability to successfully manage human capital; changes in financial accounting standards; and other risks detailed herein and in our other Securities and Exchange Commission filings, particularly in Risk Factors contained in our fiscal 2024 Form 10-K.