10-K/A: Benchmark Electronics Files Amendment to 2024 Annual Report to Correct Audit Report Date

Benchmark Electronics has filed an amendment to its 2024 annual report to correct the date of the independent auditor's report.

Summary

• Benchmark Electronics filed an amendment to its annual report on Form 10-K for the fiscal year ended December 31, 2024.
• The amendment, filed on February 27, 2025, corrects the date of the Report of Independent Registered Public Accounting Firm included in Part II, Item 8 of the original filing.
• The original filing was made on February 24, 2025.
• The amendment includes the entire text of Part II, Item 8, with the corrected date.
• Part IV, Item 15 has been amended to include updated certifications from the company's principal executive officer and principal financial officer.
• No other changes have been made to the original filing, and the amendment speaks as of the date of the original filing.
• The company has not updated the disclosures to reflect any events that occurred subsequent to the date of the original filing.
• The amendment should be read in conjunction with the original filing and subsequent filings with the SEC.
• As of June 28, 2024, the company had 36,105,370 common shares outstanding.
• The aggregate market value of common shares held by non-affiliates as of June 28, 2024, was approximately $1.4 billion.
• As of February 21, 2025, there were 36,016,624 common shares outstanding.
• The company's sales for 2024 were $2,656.1 million, compared to $2,839.0 million in 2023 and $2,886.3 million in 2022.
• Net income for 2024 was $63.3 million, compared to $64.3 million in 2023 and $68.2 million in 2022.
• Basic earnings per share were $1.76 in 2024, $1.81 in 2023, and $1.94 in 2022.
• Diluted earnings per share were $1.72 in 2024, $1.79 in 2023, and $1.91 in 2022.

Sentiment

Score: 5

Explanation: The document primarily addresses a clerical correction, but also includes financial results that indicate a slight downturn in sales and profitability. The sentiment is neutral.

Positives

• The company is correcting a clerical error in its annual report, demonstrating attention to detail.
• The company has provided updated certifications from its CEO and CFO, ensuring compliance with regulatory requirements.

Negatives

• Sales decreased from $2,839.0 million in 2023 to $2,656.1 million in 2024.
• Net income decreased from $64.3 million in 2023 to $63.3 million in 2024.
• Basic earnings per share decreased from $1.81 in 2023 to $1.76 in 2024.
• Diluted earnings per share decreased from $1.79 in 2023 to $1.72 in 2024.

Risks

• The company's customers operate in industries subject to rapid technological change, vigorous competition, and short product life cycles.
• Adverse developments in the electronics industry or affecting the company's customers could impact the company's overall credit risk.
• The company's inability to obtain needed components during periods of allocation could cause delays in manufacturing and could adversely affect the results of operations.
• A tax assessment from the Jalisco, Mexico office of customs and taxing authorities (Servicio de Administracion Tributaria (SAT)) asserting that Benchmark Guadalajara owes approximately $12.0 million in import duties, customs penalties, fees and surcharges relating to goods imported by Benchmark Guadalajara into Mexico in the first quarter of 2016.

Future Outlook

The Board of Directors currently intends to continue paying quarterly dividends, but the company's future dividend policy is subject to various factors and is not guaranteed.

Industry Context

The company operates in the electronics manufacturing services (EMS) industry, which is characterized by rapid technological change and intense competition. The company's performance is influenced by the demand for electronics products in its key market sectors: industrial, aerospace and defense, medical, semiconductor capital equipment, and advanced computing and communications.

Comparison to Industry Standards

• Comparable companies in the EMS industry include Jabil, Flex, and Sanmina.
• Benchmark's revenue and profitability metrics can be compared to these companies to assess its relative performance.
• For example, Jabil reported net revenue of $8.4 billion for its most recent quarter, while Flex reported net sales of $7.5 billion.
• Sanmina reported net sales of $1.9 billion for its most recent quarter.
• Benchmark's annual revenue of $2.656 billion is smaller than these larger competitors.
• Gross profit margins and operating margins can also be compared to industry averages to assess Benchmark's efficiency and profitability.

Legal Proceedings

• Benchmark Guadalajara received a tax assessment from the Jalisco, Mexico office of customs and taxing authorities (Servicio de Administracion Tributaria (SAT)) asserting that Benchmark Guadalajara owes approximately $12.0 million in import duties, customs penalties, fees and surcharges relating to goods imported by Benchmark Guadalajara into Mexico in the first quarter of 2016.
• The Company is involved in various legal actions arising in the ordinary course of business.

Stakeholder Impact

• Shareholders: The correction of the audit report date is unlikely to have a significant impact on shareholders.
• Employees: Restructuring activities, including workforce reductions, may impact employees.
• Customers: The company's ability to meet customer demand may be affected by component shortages.
• Suppliers: The company's relationships with suppliers may be affected by industry-wide shortages and allocation of components.

Next Steps

• Benchmark Guadalajara is pursuing administrative and judicial appeals and related reimbursement and offset opportunities regarding a tax assessment from the Jalisco, Mexico office of customs and taxing authorities (Servicio de Administracion Tributaria (SAT)).

Key Dates