Flex Reports 3Q Fiscal 2017 Results

Flex announced results for its third quarter ended Dec.31, 2016.
 
Net sales for the third quarter ended December 31, 2016 were more than $6.1 billion, which was in the guidance range of $6.0 to $6.4 billion.
 
GAAP gross margin increased 10 basis points and adjusted gross margin increased approximately 40 basis points on a year-over-year basis.
 
GAAP income before income taxes was $140 million for the quarter and adjusted operating income was $223 million, above the mid-point of the guidance range of $205 million to $235 million.
 
Net income on a GAAP basis was over $129 million and adjusted net income for the quarter was $183 million. GAAP EPS was $0.24 for the quarter and non-GAAP EPS was $0.34 for the quarter.
 
For the three-month period ended December 31, 2016, the company generated net cash from operating activities of $469 million and free cash flow of $363 million.  For the nine-month period ended Dec. 31, 2016, Flex generated net cash from operations of $1.0 billion and free cash flow of $628 million.  Strong cash flow generation has funded share repurchases of approximately $75 million and $260 million for the three- and nine-month periods ended Dec. 31, 2016, respectively. 
 
“Our Sketch-to-Scale strategy remains firmly on track as reflected in our third quarter performance,” said Mike McNamara, CEO at Flex. “We remain focused on value creating activities such as a structural mix shift to a higher margin business, generating sustainable free cash flow and consistently returning value to our shareholders.”
 
“Our cash flow generation was exceptionally strong this quarter as we generated almost half a billion dollars in cash flow from operations,” said Chris Collier, CFO at Flex. “This quarter we repurchased over 5 million shares and we remain committed to return over 50% of our fiscal year free cash flow to shareholders.”   
 
The company remains committed to return over 50% of annual free cash flow to its shareholders.  Flex ended the quarter with $1.9 billion of cash on hand and total debt of $2.9 billion.  The balance sheet remains strong and is well positioned to support the business over the long term.