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MarketScreener Homepage  >  Equities  >  Nyse  >  Jabil Inc.    JBL

JABIL INC.

(JBL)
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Jabil : Fourth Quarter 2020 Financial Results and Investor Briefing

09/24/2020 | 09:40am EST

2020 FOURTH QUARTER EARNINGS & INVESTOR BRIEFING

September 24, 2020

FORWARD LOOKING STATEMENT

Forward Looking Statements: This presentation contains forward-looking statements, including those regarding our anticipated financial results for the fourth quarter and fiscal year 2020; our guidance for future financial performance in our first quarter of fiscal year 2021 (including, net revenue, segment 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), net interest expense, and core tax rate and the components of each); our guidance for future financial performance in full fiscal year 2021 (including, net revenue, segment revenue, core operating margin, segment core margin, core earnings per share (Non-GAAP), adjusted free cash flow, free cash flow, net capital expenditures, core EBITDA, and the components and drivers of each); and our outlook for end market revenue and core operating margin. The statements in this presentation 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 the fourth quarter and fiscal year 2020 that our financial results and conditions differ from our current preliminary unaudited numbers set forth herein; the scope and duration of the COVID-19 outbreak and its impact on our operations, sites, customers and supply chain; managing growth effectively; our dependence on a limited number of customers; competitive challenges affecting our customers; managing rapid declines or increases in customer demand and other related customer challenges that may occur; changes in technology; 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; our ability to purchase components efficiently and reliance on a limited number of suppliers for critical components; risks associated with international sales and operations; our ability to achieve expected profitability from acquisitions; risk arising from our restructuring activities; issues involving our information systems, including security issues; regulatory risks; financial and market risks; and adverse changes in political conditions, in the U.S. and internationally, including, among others, adverse changes in tax laws and rates and our ability to estimate and manage their impact. 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, 2019 and our other filings with the Securities and Exchange Commission. We assume no obligation to update these forward-looking statements.

2

2020 FOURTH QUARTER EARNINGS

Mike Dastoor September 24, 2020

Fourth Quarter and Fiscal Year 2020

Income Highlights

THREE MONTHS ENDED

FISCAL YEAR ENDED

AUGUST 31,

AUGUST 31,

(In millions, except for per share data)

2020

2019

2020

2019

Net revenue

$7,300

$6,573

$27,266

$25,282

U.S. GAAP operating income

$197

$190

$500

$701

U.S. GAAP net income

$68

$53

$54

$287

U.S. GAAP diluted earnings per share

$0.44

$0.34

$0.35

$1.81

Core operating income (non-GAAP)1

$255

$246

$864

$877

Core earnings (non-GAAP)1

$151

$138

$450

$473

Core diluted earnings per share (non-GAAP)1

$0.98

$0.88

$2.90

$2.98

1 See U.S. GAAP to non-GAAP reconciliation in appendix.

4

Fourth Quarter

Segment Results

DIVERSIFIED MANUFACTURING SERVICES (DMS)

  • Net Revenue Increase of 17%
  • Core margin* (non-GAAP) of 3.5%

ELECTRONICS MANUFACTURING SERVICES (EMS)

  • Net Revenue Increase of 8%
  • Core margin* (non-GAAP) of 3.5%

TOTAL COMPANY

    • Net Revenue Increase of 11%
    • Core margin* (non-GAAP) of 3.5%
  • Core margin defined as core operating income divided by net revenue

DMS

$7.3B 39%

EMS REVENUE

61%

5

FY20

Segment Results

DIVERSIFIED MANUFACTURING SERVICES (DMS)

  • Net Revenue Increase of 8%
  • Core margin* (non-GAAP) of 3.9%

ELECTRONICS MANUFACTURING SERVICES (EMS)

  • Net Revenue Increase of 8%
  • Core margin* (non-GAAP) of 2.7%

TOTAL COMPANY

    • Net Revenue Increase of 8%
    • Core margin* (non-GAAP) of 3.2%
  • Core margin defined as core operating income divided by net revenue

DMS

$27.3B 39%

EMS REVENUE

61%

6

Cash Flow Highlights

FISCAL YEAR ENDED

AUGUST 31,

(In millions)

2020

Cash flow from operations

$1,257

Net capital expenditures1

$796

Adjusted Free cash flow (non-GAAP)1

$461

Core EBITDA (non-GAAP)1

$1,603

1 See U.S. GAAP to non-GAAP reconciliation in appendix and U.S. GAAP to non-GAAP definitions located at https://investors.jabil.com/

7

Business Update

Mark Mondello September 24, 2020

THANK YOU for being your True Self

We all have a voice that is:

Honored

Empowered

Authentic

Respected

Deserving

9

Leadership ATTENTION

Our Approach

Our Portfolio

Our Outlook

10

Our Approach

Creating a more Diverse & Inclusive Jabil

ROOTED in Purpose

INTENTIONAL in Action

ACCOUNTABLE for Progress

Aligned with our Core Values

Employing Diverse Talent

D&I Council

Critical to Business Performance

Advocate for Human Rights

Dashboards & Benchmarking

11

Our Approach

Creating a more Sustainable Jabil

Employee Volunteers, Giving Back and Making a Difference

75,000 hours

Greenhouse gas emission reduction

25% Reduction by 2025

United Nations

Sustainable Development alignment

Additional ESG Focus Areas

Safety

Water Usage

Hazardous Waste

Supply Chain

12

Our Portfolio

End-Markets

DIVERSIFIED MANUFACTURING

$ in billions

FY201

FY21E

Healthcare & Packaging

$4.2

$4.8

Automotive & Transport

$1.7

$1.9

Connected Devices

$4.0

$3.7

Mobility

$3.3

$3.6

Total Revenue

$13.2

$14.0

Core Operating Margin

3.7%

4.5%

ELECTRONICS MANUFACTURING

$ in billions

FY201

FY21E

Digital Print & Retail

$2.3

$2.3

Industrial & Semi-Cap

$3.5

$3.5

5G, Wireless & Cloud

$5.5

$4.5 *

Networking & Storage

$2.8

$2.2

Total Revenue

$14.1

$12.5

Core Operating Margin

2.7%

3.5%

* Cloud transitioning to a consignment model

1 As of September 1, 2020, certain customers have been realigned within our reporting segments. See appendix for additional information.

See U.S. GAAP to non-GAAP definitions located at https://investors.jabil.com/

13

Our Portfolio

DMS Segment with Strong Margins

DIVERSIFIED MANUFACTURING

DMS

DMS Pedigree and Construct

• Product Validation & Regulated Environments

Mobility

Healthcare

& Packaging

  • Advanced Material Sciences and Mechanics
  • Margin Expansion and Reliable Cash Flows

FY21 Financial Plan

• Revenue: ~$14 Billion

• Core Margin: ~4.5%

Connected

Devices

Automotive & Transport

See U.S. GAAP to non-GAAP definitions located at https://investors.jabil.com/

14

Our Portfolio

EMS Segment with Strong Cash Flows

EMS

Digital Print &

Networking &Retail

Storage

Industrial &

Semi-Cap

5G, Wireless &

Cloud

EMS Pedigree and Construct

  • Standardized Manufacturing / IT Solutions
  • Enduring End-markets
  • Strong Cash Flows and Stable Margins

FY21 Financial Plan

  • Revenue: ~$12.5 Billion
  • Core Margin: ~3.5%

See U.S. GAAP to non-GAAP definitions located at https://investors.jabil.com/

15

Our Outlook

Delivering a credible Financial Plan

NET REVENUE

CORE OP MARGIN

CORE EPS

FREE CASH FLOW

~$26.5

4.0%

$4.00

$600+

BILLION

MILLION

MANAGEMENT'S OUTLOOK FOR FY21

See U.S. GAAP to non-GAAP definitions located at https://investors.jabil.com/

16

Our Outlook

Derived with Harmonious Collaboration

17

Our Outlook

Grounded by a Straight-forward Strategy

  • Ensure our Business mix remains well Diversified
  • Obsess over our Customers while leading with Engineering
  • Drive Growth through collaborative sharing of Capabilities across the Enterprise
  • Continue to contour our Portfolio for Margin expansion
  • Deliver reliable Cash flows by leveraging our exposure to varied End-Markets

18

THANK YOU for being your True Self

We all have a voice that is:

Honored

Empowered

Authentic

Respected

Deserving

19

Financial Update

Mike Dastoor September 24, 2020

Financial Priorities

EXPAND

INCREASE

GENERATE

OPERATING MARGINS

EARNINGS PER SHARE

STRONG CASH FLOWS

ALIGNED & FOCUSED ON DRIVING LONG-TERM VALUE CREATION

21

Our Portfolio

End-Markets

DIVERSIFIED MANUFACTURING

$ in billions

FY201

FY21E

Healthcare & Packaging

$4.2

$4.8

Automotive & Transport

$1.7

$1.9

Connected Devices

$4.0

$3.7

Mobility

$3.3

$3.6

Total Revenue

$13.2

$14.0

Core Operating Margin

3.7%

4.5%

ELECTRONICS MANUFACTURING

$ in billions

FY201

FY21E

Digital Print & Retail

$2.3

$2.3

Industrial & Semi-Cap

$3.5

$3.5

5G, Wireless & Cloud

$5.5

$4.5 *

Networking & Storage

$2.8

$2.2

Total Revenue

$14.1

$12.5

Core Operating Margin

2.7%

3.5%

* Cloud transitioning to a consignment model

1 As of September 1, 2020, certain customers have been realigned within our reporting segments. See appendix for additional information.

See U.S. GAAP to non-GAAP definitions located at https://investors.jabil.com/

22

Positioned to Deliver

Operating Margin Expansion

Drivers of

Core Operating

Y/Y Margin Expansion

Margin

($ in millions)

1. Improved business mix

4.0%

2.

Improved efficiency on lower cost

3.5%

3.2%

structure

3.

Lower COVID-related costs

FY19

FY20

FY21E

See U.S. GAAP to non-GAAP definitions and reconciliations located at https://investors.jabil.com/

23

FY21

Disciplined Investment

FY21 Net Capex

($ millions)

Net Capex

FY21

Maintenance Investment

$550

Growth Investment

$250

Company Total

$800

See U.S. GAAP to non-GAAP definitions and reconciliations located at https://investors.jabil.com/

24

FY21

EBITDA & Free Cash Flow Generation

Drivers of Future

CORE EBITDA

Free Cash Flow

($ billions)

$1.8

1.

Earnings expansion

$1.6

$1.6

2.

Working capital efficiencies

3.

Disciplined investment

FY19

FY20

FY21E

Adjusted FCF

($ millions)

$600+

$503

$461

FY19 FY20 FY21E

See U.S. GAAP to non-GAAP definitions and reconciliations located at https://investors.jabil.com/

25

Capital Allocation Framework

Cash flow from operations

Net Capex

  • 60%
    Free Cash Flow

Debt Optimization

Share Repurchases &

& M&A

Dividends

~ 40%

~ 60%

VALUE CREATION FOR JABIL SHAREHOLDERS

26

First Quarter FY21

Guidance

Segment Revenue Guidance

Q1 FY201

Q1 FY21E1

YoY Change

Diversified Manufacturing Services

$3.75B

$3.8B

Increase 1%

Electronics Manufacturing Services

$3.76B

$3.2B

Decrease 15%

Consolidated Guidance

Q1 FY21E

Net revenue

$6.7B

- $7.3B

U.S. GAAP operating income

$238M

- $283M

U.S. GAAP diluted earnings per share

$0.79 - $1.02

Core operating income (non-GAAP)2

$295M - $335M

Net interest expense3

EMS

$47M

Core tax rate (non-GAAP)4

26% to 28%

Core diluted earnings per share (non-GAAP)2

$1.15

- $1.35

  1. As of September 1, 2020, certain customers have been realigned within our reporting segments. See appendix for additional information.
  2. See U.S. GAAP to non-GAAP reconciliation on Form-8K filed on September 24, 2020.
  3. Net interest expense = interest expense + loss on sale of AR - interest income
  4. Core tax rate excludes the tax impacts related to amortization of intangibles, stock-based compensation expense and related charges, restructuring, severance and related charges and acquisition and integration charges.

27

Our Outlook

Delivering a credible Financial Plan

NET REVENUE

CORE OP MARGIN

CORE EPS

FREE CASH FLOW

~$26.5

4.0%

$4.00

$600+

BILLION

MILLION

MANAGEMENT'S OUTLOOK FOR FY21

See U.S. GAAP to non-GAAP definitions located at https://investors.jabil.com/

28

MARK MONDELLO

MIKE DASTOOR

CHIEF EXECUTIVE OFFICER

CHIEF FINANCIAL OFFICER

APPENDIX GAAP to Non-GAAP Reconciliations

JABIL INC. AND SUBSIDIARIES

OPERATING INCOME, EBITDA and NET INCOME NON-GAAP RECONCILIATION

(In thousands, except for per share data)

(Unaudited)

Three months ended

Fiscal year ended

August 31, 2020

August 31, 2019

August 31, 2020

August 31, 2019

Operating income (U.S. GAAP)

$

197,053

$

189,745

$

499,846

$

701,356

Amortization of intangibles

12,649

8,890

55,544

31,923

Stock-based compensation expense and related charges

20,870

13,894

83,084

61,346

Restructuring, severance and related charges

12,581

9,732

156,586

25,914

Distressed customer charge

-

6,235

14,963

6,235

Net periodic benefit cost

8,680

-

16,078

-

Business interruption and impairment charges, net

1,211

-

5,785

(2,860)

Acquisition and integration charges

2,162

17,631

32,167

52,697

Adjustments to operating income

58,153

56,382

364,207

175,255

Core operating income (Non-GAAP)

$

255,206

$

246,127

$

864,053

$

876,611

Core operating income (Non-GAAP)

$

255,206

$

246,127

$

864,053

$

876,611

Depreciation expense

181,240

187,990

739,038

739,910

Core EBITDA (Non-GAAP)

$

436,446

$

434,117

$

1,603,091

$

1,616,521

Net income attributable to the Company (U.S. GAAP)

$

67,731

$

52,675

$

53,912

$

287,111

Adjustments to operating income

58,153

56,382

364,207

175,255

Loss on securities

36,420

29,632

48,625

29,632

Net periodic benefit cost

(8,680)

-

(16,078)

-

Adjustment for taxes

(2,259)

(796)

(1,093)

(18,633)

Core earnings (Non-GAAP)

$

151,365

$

137,893

$

449,573

$

473,365

Diluted earnings per share (U.S. GAAP)

$

0.44

$

0.34

$

0.35

$

1.81

Diluted core earnings per share (Non-GAAP)

$

0.98

$

0.88

$

2.90

$

2.98

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

154,453

156,981

155,274

158,647

31

(1)

FY20 Revenue as Recast

Diversified Manufacturing

Electronics Manufacturing

Fiscal year

Fiscal year

$ in billions

Three months ended

ended

$ in billions

Three months ended

ended

November

February

May 31,

August 31,

August 31,

November

February

May 31,

August 31,

August 31,

30, 2019

29, 2020

2020

2020

2020

30, 2019

29, 2020

2020

2020

2020

Total Revenue

$3.7

$2.9

$3.0

$3.6

$13.2

Total Revenue

$3.8

$3.2

$3.4

$3.7

$14.1

Core Operatng

Core Operatng

Margin

5.0%

3.0%

2.5%

3.9%

3.7%

Margin

2.4%

2.3%

2.9%

3.1%

2.7%

  1. As of September 1, 2020, certain customers have been realigned within our reporting segments. Beginning in fiscal year 2021, customers within the automotive and transportation and smart home and appliances industries will be presented and moved from the EMS segment to the DMS segment.

32

Disclaimer

Jabil Inc. published this content on 23 September 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 September 2020 13:39:08 UTC


© Publicnow 2020
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Financials (USD)
Sales 2021 27 616 M - -
Net income 2021 583 M - -
Net Debt 2021 1 158 M - -
P/E ratio 2021 12,0x
Yield 2021 0,74%
Capitalization 6 751 M 6 751 M -
EV / Sales 2021 0,29x
EV / Sales 2022 0,27x
Nbr of Employees 240 000
Free-Float 52,0%
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Mean consensus BUY
Number of Analysts 9
Average target price 50,33 $
Last Close Price 45,14 $
Spread / Highest target 32,9%
Spread / Average Target 11,5%
Spread / Lowest Target -6,96%
EPS Revisions
Managers and Directors
NameTitle
Mark T. Mondello Chief Executive Officer & Director
Timothy L. Main Chairman
Meheryar K. Dastoor Chief Financial Officer & Executive Vice President
May Yap Chief Information Officer & Senior Vice President
Steven A. Raymund Independent Director
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