This quarterly report (this Report) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act). These forward-looking statements are identified as any statement that does not relate strictly to historical or current facts and may include words such as "anticipate," "believe," "intend," "plan," "projection," "forecast," "strategy," "position," "continue," "estimate," "expect," "may," "will," or the negative or other variations thereof. In particular, statements, express or implied, concerning future operating results, including guidance for second quarter 2020 results and beyond, our ability to generate sales, income or cash flow, the anticipated impact of the COVID-19 pandemic, our anticipated plans and responses to the COVID-19 pandemic, our expected revenue mix, our business strategy and strategic initiatives, our repurchases of shares of our common stock and our intentions concerning the payment of dividends, among others. Although we believe these statements are based upon reasonable assumptions, they involve risks, uncertainties and assumptions that are beyond our ability to control or predict, relating to operations, markets and the business environment generally, including those discussed in Part I, Item 1A of the 2019 10-K, in Part II, Item 1A of this Report and in any of our subsequent reports filed with the SEC. In particular, these statements also depend on the duration, severity and evolution of the COVID-19 pandemic and related risks, including government and other third-party responses to it and the consequences for the global economy, our business and the businesses of our suppliers and customers, as well as our ability (or inability) to execute on its plans to respond to the COVID-19 pandemic. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes, including the future results of our operations, may vary materially from those indicated. Undue reliance should not be placed on any forward-looking statements. Forward-looking statements are not guarantees of performance. The following discussion should be read in conjunction with the Condensed Consolidated Financial Statements and accompanying notes, and the 2019 10-K. All forward-looking statements included in this document are based upon information available to the company as of the date of this document, and it assumes no obligation to update them.





OVERVIEW

We are a worldwide provider of innovative product design, engineering services, technology solutions and advanced manufacturing services (both electronic manufacturing services (EMS) and precision technology machining services). In this Report, references to Benchmark, the Company or use of the words "we", "our" and "us" include Benchmark's subsidiaries unless otherwise noted.

From initial product concept to volume production, including direct order fulfillment and aftermarket services, Benchmark has been providing integrated services and solutions to original equipment manufacturers (OEMs) since 1979. Today, Benchmark proudly serves the following industries: aerospace and defense (A&D), medical technologies, complex industrials, semiconductor capital equipment (Semi-Cap), next-generation telecommunications and advanced computing.

Our customer engagement focuses on three principal areas:

•Engineering Services, which includes turnkey product design, design for manufacturability, manufacturing process and test development, concurrent and sustaining engineering and regulatory services. Our engineering services may be for systems, sub-systems, printed circuit boards and assemblies, and components. We provide these services across all the industries we serve, but focus primarily in regulated industries such as medical, complex industrials, aerospace and defense, and next-generation telecommunications.

•Technology Solutions, which involve developing a library of building blocks or reference designs



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primarily in defense solutions, surveillance systems, radio frequency and high-speed design, and front-end managed connectivity data collection systems. We often merge these technology solutions with engineering services in order to support manufacturing services. Our reference designs can be utilized across a variety of industries but we have significant capabilities in the aerospace and defense and next-generation telecommunications markets. We have also developed stronger capabilities in radio frequency (RF) and high speed design for both components and substrates. The need to reduce Size, Weight, and Power (SWaP) to accommodate embedding high frequency electronic communications into specific designs is important to customers in the aerospace and defense, medical, and next-generation telecommunications markets.

•Manufacturing Services, which include producing printed circuit board assemblies (PCBAs) using both traditional surface mount technologies (SMT) and microelectronics are then often integrated into a subsystem assembly, or a box build as part of systems integration. Systems integration often involves building a finished assembly that includes PCBAs, complex subsystem assemblies, mechatronics, displays, optics, and other components. These final products may be configured to order and delivered directly to the end-customer across all the industries we serve. Manufacturing services also includes precision technology manufacturing comprised of precision machining, advanced metal joining, assembly and functional testing primarily for customers in the semiconductor capital equipment as well as the medical and aerospace and defense markets.

Our core strength lies in our ability to provide concept-to-production solutions in support of our customers. Our global manufacturing presence increases our ability to respond to our customers' needs by providing accelerated time-to-market and time-to-volume production of high-quality products - especially for complex products with lower volume and higher mix in regulated markets. These capabilities enable us to build strong strategic relationships with our customers and to become an integral part of their business.

We believe our primary competitive advantages are our engineering services (including product design), technology solutions, and manufacturing services (including electronics and precision technology capabilities) provided by highly skilled personnel. We continue to invest in our business to expand our skills and service offerings from direct customer inputs. We have a closed-loop feedback system in place to respond to customer ideas to enhance our future designs and manufacturing solutions in support of the full life cycle of their products. These solutions offload the electronics design work from our customers so they can focus on product areas where they can provide more value add and in the process accelerate their time-to-market and reduce their product development costs. Working closely with our customers and responding promptly to their needs, we become an integral part of their development process helping them bring products to market faster and more economically.

In addition, we believe that a strong focus on human capital through the talent we hire and retain is critical to maintaining our competitiveness. We are driving a customer-centric organization with a high degree of accountability and ownership to develop processes necessary to exceed customer expectations and deliver financial performance aligned to our goals. Through our employee feedback process, we solicit and act upon information to improve our company and better support our customers and business processes in the future. We have taken steps to attract the best leaders into our business and we are accelerating our efforts to mentor and develop key leaders for the future.

Our customers often face challenges in designing supply chains, demand planning, procuring materials and managing their inventories efficiently due to fluctuations in their customer demand, product design changes, short product life cycles and component price fluctuations.

We employ enterprise resource planning (ERP) systems and lean manufacturing principles to manage



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procurement and manufacturing processes in an efficient and cost-effective manner so that, where possible, components arrive on a just-in-time, as-and-when-needed basis. Because we are a significant purchaser of electronic components and other raw materials, we are able to capitalize on the economies of scale associated with our relationships with suppliers to negotiate price discounts, obtain components and other raw materials that are in short supply, and return excess components. Our agility and expertise in supply chain management and our relationships with suppliers across the supply chain enable us to help reduce our customers' cost of goods sold and inventory exposure.

We recognize revenue as the customer takes control of the manufactured products built to customer specifications. We also generate revenue from our design, development and engineering services, in addition to the sale of other inventory.

Revenue is measured based on the consideration specified in a contract with a customer. Under the majority of our manufacturing contracts with customers, the customer controls all of the work-in-progress as products are being built. Revenues under these contracts are recognized over time based on the cost-to-cost method. Under other manufacturing contracts, the customer does not take control of the product until it is completed. Under these contracts, we recognize revenue upon transfer of control of product to the customer, which is generally when the goods are shipped. Revenue from engineering services that include design and development elements also continues to be recognized over time as the services are performed. We assume no significant obligations after shipment as we typically warrant workmanship only. Therefore, the warranty provisions are generally not significant.

COVID-19 Pandemic Update

In late 2019, there was an outbreak of a new strain of coronavirus (COVID-19) first identified in Wuhan, Hubei Province, China, which has since spread globally. On March 11, 2020, the World Health Organization declared COVID-19 a pandemic. Further, the COVID-19 outbreak has resulted in government authorities around the world implementing numerous measures to try to reduce the spread of COVID-19, such as travel bans and restrictions, quarantines, "shelter-in-place," "stay-at-home," total lock-down orders, business limitations or shutdowns and similar orders. As a result, the COVID-19 pandemic has negatively impacted the global economy, disrupted global supply chains and workforce participation, and created significant volatility and disruption of financial markets. In an effort to first and foremost protect the health and safety of our employees, we also took proactive action to adopt social distancing policies at our locations globally, including working from home for certain employees, limiting the number of employees attending meetings, reducing the number of people in our locations at any one time, and suspending employee travel.

Benchmark provides critical infrastructure products and essential services in each of our locations. However, as a result of the COVID-19 pandemic, including the related responses from government authorities, the Company's operations were impacted worldwide starting in the first quarter of 2020. The disruptive impacts caused by the COVID-19 pandemic to the Company's first quarter results were driven by reduced productivity levels throughout our facilities, direct costs associated with labor expenses, personal protective equipment, supply chain inefficiencies and under absorption of fixed costs. These impacts began with a shut-down of the Company's manufacturing facilities in Suzhou, China early in the first quarter of 2020 (which have now ramped back to full capacity starting in mid-March).

However, the disruptive impacts caused by the COVID-19 pandemic have since affected our operations in all other regions. For example, starting in mid-March, our Penang, Malaysia operation, which includes our largest precision machining facility, was significantly disrupted. As a result, our Penang, Malaysia operation has been operating at approximately 30% of capacity through the end of the first quarter of 2020. The facility has only recently been granted permission to resume full operations. Other operations that have



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experienced, and continue to experience, significant disruptions include our facilities in California, as well as in Tijuana and Guadalajara, Mexico. We have resumed operations in Tijuana and will be returning to full production in phases.

Further, we have experienced, and continue to experience, a challenging supply chain environment and labor constraints due to the COVID-19 pandemic. Our revenue for the first three months of 2020 was impacted as a result of the COVID-19 pandemic. We expect revenue will be negatively impacted during the second quarter of 2020 due to operational inefficiencies and supply chain capabilities to support customer demand.

The COVID-19 pandemic continues to affect the Company's operations into the second quarter of 2020, due in large part to government enacted plant shut-downs, stay-at-home or shelter-in-place or similar restrictions, particularly in our Tijuana, Mexico, Penang, Malaysia and California facilities, as discussed above. We also anticipate that we may experience customer demand fluctuations and further supply chain constraints stemming from the impact of the COVID-19 pandemic, which could have resulting impacts on our business, financial condition, results of operations, and our ability (or inability) to execute on our plans to respond to the COVID-19 pandemic.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted in the United States in response to the COVID-19 pandemic. The CARES Act among other things, permits NOL carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021, and contains modifications on the limitation of business interest for tax years beginning in 2019 and 2020. The Company has evaluated the impact of these provisions and has determined these provisions did not have any impact on our first quarter results. In addition, the CARES Act allows for employee retention tax credits to be taken in future US payroll tax filings and allows for the deferral of certain future employer portion of social security tax with 50% to be paid at the end of calendar years 2021 and 2022, respectively. The Company is currently evaluating the benefits of these items for future quarters.

International authorities in various jurisdictions have also allowed for cash grants, delay of tax filings, and delay of tax payments for future quarters. We are evaluating and determining whether we can take advantage of these benefits in certain jurisdictions, if warranted.

In response to uncertainties related to the impact of the COVID-19 virus, we are proactively taking a series of actions to lower our cost structure and reduce capital expenditures. On April 29, 2020, the Company announced a temporary 10% salary reduction for all executive officers (including our named executive officers) effective April 27, 2020 through December 31, 2020 and the Company Board of Directors approved a temporary 10% reduction in their quarterly cash compensation effective April 27, 2020 through December 31, 2020. Other senior leaders in the Company will take a 7% salary reduction through September 29, 2020. Additional cost reduction actions in our U.S. factories will consist of employees taking rotating time off depending on the factory loading levels. Cost reduction actions in our non-U.S. locations will depend on local law requirements. Additionally, we expect to reduce variable compensation and other discretionary expenses, such as travel. We have also implemented actions to conserve our cash and cash equivalents such as reducing planned capital expenditures, deferring certain planned investments, temporarily suspending our share repurchase activity, and deferring payroll and income tax payments in accordance with the CARES Act. Finally, we have implemented certain other procedures to manage potential risks related to working capital such as closely monitoring the financial stability, payment terms and credit limits of our customers.

We continue to monitor the rapidly evolving situation and guidance from international and domestic authorities, including federal, state and local public health authorities, and may take additional actions



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based on their recommendations. In these circumstances, there may be developments outside our control requiring us to adjust our operating plan. As such, the exact extent of the impact of the COVID-19 pandemic on our business, financial condition and results of operations, is currently unknown and will depend on future developments, which are highly uncertain, continuously evolving and cannot be predicted. This includes, but is not limited to, the duration and spread of the COVID-19 pandemic, its severity, the actions to contain the virus or treat its impact and how quickly and to what extent normal economic and operating conditions can resume.

Accordingly, our current results and financial condition discussed herein may not be indicative of future operating results and trends. See "Risk Factors" in Part II, Item 1A of this Report for additional risks we face due to the COVID-19 pandemic.





First Quarter 2020 Highlights

Sales for the three months ended March 31, 2020 decreased 15% to $515.0 million compared to $602.8 million during the comparable 2019 period. During the first quarter of 2020, sales to customers in our various industry sectors fluctuated from the comparable 2019 period as follows:

Higher-Value Markets

?Industrials decreased by 12%,

?A&D increased by 15%,

?Medical increased by 14%, and

?Semi-Cap increased by 25%.

Traditional Markets

?Computing decreased by 71%, and

?Telecommunications decreased by 37%.

The overall revenue decrease was driven primarily by lower revenue in Computing due to our exit from a legacy Computing contract (as discussed below) which was dilutive to our gross margin, in addition to lower Telecommunications revenue due to softer demand from legacy broadband products. These decreases were partially offset by increased revenue in the A&D, Medical and Semi-Cap sectors. Higher-value markets were up 8% primarily from the increased revenues in A&D, Medical and Semi-Cap, and traditional market revenues were down 57% year-over-year from lower Computing and Telecommunications revenues as described above.

Our sales depend on the success of our customers, some of which operate in businesses associated with rapid technological change and consequent product obsolescence. Developments adverse to our major customers or their products, or the failure of a major customer to pay for components or services, can adversely affect us. A substantial percentage of our sales are made to a small number of customers, and the loss of a major customer, if not replaced, would adversely affect us. Sales to our ten largest customers represented 42% and 41% of our sales in the three months ended March 31, 2020 and 2019, respectively.

During 2018, as part of our ongoing process to review contracts that are marginal and dilutive to our gross margin, we made the decision to not renew the legacy contract with a large Computing customer that was to expire at the end of 2019. During the second quarter of 2019, we completed the final build out of this legacy contract and in the third quarter of 2019 had an immaterial amount of revenue from this contract as the transition was completed.

We experience fluctuations in gross profit from period to period. Different programs contribute different gross margins depending on the type of services involved, location of production, size of the program, complexity of the product and level of material costs associated with the various products. Moreover, new programs can contribute relatively less to our gross profit in their early stages when manufacturing volumes are usually lower, resulting in inefficiencies and unabsorbed manufacturing overhead costs. In addition, a number of our new and higher-volume programs remain subject to competitive constraints that can exert downward pressure on our margins. During periods of low production volume and slow new program



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ramps, we generally have idle capacity and reduced gross margin. Gross profit can also be impacted by other situations, such as the current COVID-19 global pandemic discussed above and the ransomware incident experienced in 2019.

We have undertaken initiatives to restructure our business operations with the intention of improving utilization and reducing costs. During the first three months of 2020, we recognized $1.7 million of restructuring charges and other costs due in part to expenses associated with various site closures and restructuring activities, in addition to our go to market changes. In addition, during the first three months of 2020, we incurred $1.0 million in costs related to an asset impairment in Asia.

RESULTS OF OPERATIONS

The following table presents the percentage relationship that certain items in our Condensed Consolidated Statements of Income bear to sales for the periods indicated. The financial information and the discussion below should be read in conjunction with the Condensed Consolidated Financial Statements and Notes thereto in Part I, Item 1 of this Report.





                                                 Three Months Ended
                                                     March 31,
                                                   2020         2019

Sales                                               100.0 %     100.0 %
Cost of sales                                        91.6        91.7
   Gross profit                                       8.4         8.3

Selling, general and administrative expenses 6.1 5.0 Amortization of intangible assets

                     0.5         0.4
Restructuring charges and other costs                 0.6         0.3
   Income from operations                             1.3         2.7
Other income (expense), net                         (0.3)         0.2
   Income before income taxes                         0.9         2.9
Income tax expense                                    0.2         0.6
   Net income                                         0.7 %       2.3 %




Sales

As noted above, sales decreased 15% in 2020 from 2019. Sales by sector were as
follows:



                        Three Months Ended
                             March 31,
(in thousands)           2020        2019
Higher-Value Markets
Industrials           $ 102,826   $ 116,373
A&D                     119,200     103,889
Medical                 117,976     103,478
Semi-Cap                 82,720      66,021
                        422,722     389,761
Traditional Markets
Computing                36,601     124,310

Telecommunications 55,641 88,749


                         92,242     213,059
Total                 $ 514,964   $ 602,820


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Industrials. 2020 sales decreased 12% to $102.8 million from $116.4 million in 2019 primarily due to softer demand from existing customers.

Aerospace and Defense. 2020 sales increased 15% to $119.2 million from $103.9 million in 2019 primarily due to increased demand from our defense customers.

Medical. 2020 sales increased 14% to $118.0 million from $103.5 million in 2019 primarily due to higher demand and program ramps from new and existing customers.

Semiconductor Capital Equipment. 2020 sales increased 25% to $82.7 million from $66.0 million in 2019 primarily due to higher demand throughout the broader semiconductor capital equipment market.

Computing. 2020 sales decreased 71% to $36.6 million from $124.3 million in 2019 primarily from our exit of a legacy Computing contract that was completed in 2019.

Telecommunications. 2020 sales decreased 37% to $55.7 million from $88.7 million in 2019 due primarily to decreased demand from existing customers.

Our international operations are subject to the risks of doing business abroad. See Part I, Item 1A of our 2019 10-K for factors pertaining to our international sales and fluctuations in the exchange rates of foreign currency and for further discussion of potential adverse effects in operating results associated with the risks of doing business abroad. During 2020 and 2019, 49% and 45%, respectively, of our sales were from international operations.

Gross Profit

Gross profit decreased 13% to $43.4 million for 2020 from $50.0 million in 2019. For the three months ended March 31, 2019, gross profit included $1.0 million of recoveries associated with inventory charges from customer insolvencies in 2018. Gross margin was 8.4% for the three months ended March 31, 2020 and 8.3% for the three months ended March 31, 2019 including the partial inventory charge recoveries in 2019. Excluding the recoveries, gross margin increased to 8.4% for the three months ended March 31, 2020 from 8.1% in 2019 primarily due to the 71% reduction in Computing revenue, which typically has lower gross margins compared to our other markets.

Selling, General and Administrative Expenses

SG&A increased 5% to $31.6 million in 2020 from $30.0 million in 2019. During 2019, we had a $1.7 million recovery of a provision for accounts receivable associated with the insolvency of a customer. Including this recovery, SG&A, as a percentage of sales, was 6.1% in 2020 and 5.0% in 2019. Excluding this recovery, SG&A, as a percentage of sales, was 6.1% in 2020 and 5.3% in 2019. The increase in SG&A as a percentage of sales is due to the lower revenues in 2020.

Amortization of Intangible Assets

Amortization of intangible assets was $2.4 million in each of 2020 and 2019.

Restructuring Charges and Other Costs

During the first three months of 2020, we recognized $1.7 million of restructuring charges, primarily related to site closures and restructuring activities in certain facilities in the Americas and Asia. In addition, during the first three months of 2020, we incurred $1.0 million in costs related to an asset impairment in Asia. In the first three months of 2019, we recognized $0.6 million of restructuring charges, primarily related to reductions in workforce in certain facilities in the Americas and Asia. In addition, during the first three months of 2019, we incurred $1.0 million in costs primarily related to fees and costs incurred in reaching the cooperation agreement with Engaged Capital and other proxy related activities as well as our



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CEO transition. See Note 13 to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Report.

Interest Expense

Interest expense increased to $1.7 million during the first three months of 2020 from $1.6 million during the comparable 2019 period due to higher debt levels.

Interest Income

Interest income decreased to $0.6 million during the first three months of 2020 from $1.3 million during the comparable 2019 period due primarily to lower invested cash equivalents and the lower interest rate environment.

Income Tax Expense

Income tax expense of $0.9 million represented an effective tax rate of 18.5% for the first three months of 2020, compared with $3.6 million for the comparable 2019 period, which represented an effective tax rate of 20.8%. The decrease in the effective tax rate was primarily due to the mix of earnings and taxing jurisdictions.

We have been granted certain tax incentives, including tax holidays, for our subsidiaries in Malaysia and Thailand that will expire at various dates, unless extended or otherwise renegotiated, through 2021 in Malaysia, and 2028 in Thailand. See Note 9 to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Report.





Net Income

We reported net income of $3.9 million, or $0.10 per diluted share, for the first three months of 2020, compared with a net income of $13.8 million, or $0.34 per diluted share, for the same period in 2019. The net decrease of $9.9 million from 2019 was primarily the result of lower gross profit as well as higher selling, general and administrative expenses and restructuring charges and other costs in 2020.

LIQUIDITY AND CAPITAL RESOURCES

We have historically financed our organic growth and operations through funds generated from operations and occasional borrowings under our revolving credit facility. Cash and cash equivalents and restricted cash totaled $411.8 million at March 31, 2020 and $364.0 million at December 31, 2019, of which $188.8 million and $197.8 million, respectively, were held outside the U.S. in various foreign subsidiaries.

Cash used in operating activities during the first three months of 2020 was $3.1 million and consisted primarily of $3.9 million of net income adjusted for $12.2 million of depreciation and amortization, a $6.4 million decrease in accounts receivable and a $14.9 million increase in accounts payable, offset by a $23.8 million increase in inventories and $17.2 million decrease in accrued liabilities. The decrease in accounts receivable was impacted by lower sales. The increase in inventories is primarily related to mix changes from customers late in the first quarter of 2020 and inventory to support long productions cycles for products in our Semi-Cap and Medical sectors. The increase in accounts payable was primarily a result of the timing of inventory purchases and the timing of payments. The decrease in accrued liabilities was primarily a result of the timing of payments. Working capital was $0.8 billion at March 31, 2020 and $0.7 billion at December 31, 2019.

We purchase components only after customer orders or forecasts are received, which mitigates, but does not eliminate, the risk of loss on inventories. Supplies of electronic components and other materials used in operations are subject to industry-wide shortages. In certain instances, suppliers may allocate available quantities to us. If shortages of these components and other material supplies used in operations occur,



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vendors may not ship the quantities we need for production, and we may be forced to delay shipments, which can increase backorders and impact cash flows. We have also experienced, and continue to experience, a challenging supply chain environment, and labor constraints due to the COVID-19 virus.

Cash used in investing activities during the first three months was $11.5 million for 2020, primarily due to purchases of additional property, plant and equipment totaling $11.9 million. The purchases of property, plant and equipment were primarily for machinery and equipment in the Americas and Asia.

Cash provided by financing activities during the first three months of 2020 was $66.5 million. Share repurchases totaled $19.3 million, net borrowing activities on long-term debt totaled $92.8 million, dividends totaled 5.5 million, and we received $0.4 million from the exercise of stock options.

Under the terms of our $650.0 million Credit Agreement, in addition to the Term Loan facility, we have a $500.0 million five-year revolving credit facility to be used for general corporate purposes (subject to compliance with financial covenants as to interest coverage and debt leverage, in addition to other debt covenant restrictions), both with a maturity date of July 20, 2023. The Credit Agreement includes an accordion feature pursuant to which total commitments under the facility may be increased by an additional $275.0 million, subject to satisfaction of certain conditions. As of March 31, 2020, we had $142.5 million in borrowings outstanding under the Term Loan Facility and $95.0 million in borrowings and $3.7 million in letters of credit outstanding under the Revolving Credit Facility, respectively. See Note 6 to the Condensed Consolidated Financial Statements included in Part I, Item 1 of this Report for more information regarding the terms of the Credit Agreement.

The Credit Agreement contains certain financial covenants as to interest coverage and debt leverage, and certain customary affirmative and negative covenants, including restrictions on our ability to incur additional debt and liens, pay dividends, repurchase shares, sell assets and merge or consolidate with other persons. Amounts due under the Credit Agreement could be accelerated upon specified events of default, including a failure to pay amounts due, breach of a covenant, material inaccuracy of a representation, or occurrence of bankruptcy or insolvency, subject, in some cases, to cure periods. As of March 31, 2020, we were in compliance with all of these covenants and restrictions.

Our operations, and the operations of businesses we acquire, are subject to certain foreign, federal, state and local regulatory requirements relating to environmental, waste management, health and safety matters. We believe we operate in substantial compliance with all applicable requirements and we seek to ensure that newly acquired businesses comply or will comply substantially with applicable requirements. To date, the costs of compliance and workplace and environmental remediation have not been material to us. However, material costs and liabilities may arise from these requirements or from new, modified or more stringent requirements in the future. In addition, our past, current and future operations, and the operations of businesses we have or may acquire, may give rise to claims of exposure by employees or the public, or to other claims or liabilities relating to environmental, waste management or health and safety concerns.

As of March 31, 2020, we had cash and cash equivalents totaling $411.8 million and $401.3 million available for borrowings under the Revolving Credit Facility, subject to compliance with financial covenants as to interest coverage and debt leverage, in addition to other debt covenant restrictions as described above. During the next 12 months, we believe our capital expenditures will approximate $25 million to $30 million, principally for machinery and equipment to support our ongoing business around the globe, in addition to expenditures for information technology infrastructure items and software.

On October 26, 2018, our Board of Directors approved an expanded stock repurchase program granting us the authority to repurchase up to $100 million in common stock in addition to the $250 million approved on



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March 6, 2018. On February 19, 2020, the Board of Directors authorized the repurchase of an additional $150 million of the Company's common stock. As of March 31, 2020, we had $210.1 million remaining under the share repurchase authorization to purchase additional shares. We are under no commitment or obligation to repurchase any particular amount of common stock.

Management believes that our existing cash balances and funds generated from operations will be sufficient to permit us to meet our liquidity requirements over the next 12 months. Management further believes that our ongoing cash flows from operations and any borrowings we may incur under our Revolving Credit Facility will enable us to meet operating cash requirements in future years. If we consummated significant acquisitions in the future, our capital needs would increase and could possibly result in our need to increase available borrowings under our Credit Agreement or access public or private debt and equity markets. There can be no assurance, however, that we would be successful in raising additional debt or equity on acceptable terms.





CONTRACTUAL OBLIGATIONS

We have certain contractual obligations for operating and capital leases that were summarized in a table of Contractual Obligations in our 2019 10-K. There have been no material changes to our contractual obligations, outside of the ordinary course of our business, since December 31, 2019.

OFF-BALANCE SHEET ARRANGEMENTS

As of March 31, 2020, we did not have any significant off-balance sheet arrangements. See Note 16 to the Condensed Consolidated Financial Statements.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES AND RECENTLY ENACTED ACCOUNTING PRINCIPLES

Management's discussion and analysis is based upon our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. See Note 2 to the Condensed Consolidated Financial Statements in Part 1, Item 1 of this Report for a discussion of recently enacted accounting principles. Also, our significant accounting policies are summarized in Note 1 to the Consolidated Financial Statements included in our 2019 10-K.

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