Powering the Future: Why Thermal Management Defines the Future of Electronics
Standard of Excellence: Engineering Is the New Sales—How Technical Collaboration Wins Business
SMT Perspectives & Prospects: Artificial Intelligence, Part 7—Data Module 2
Plexus Announces Revised Capital Allocation Plan, Employee Bonus
March 7, 2018 | Plexus Corp.Estimated reading time: 3 minutes
Plexus Corp. announced that recent U.S. tax reform will enable it to tax-efficiently repatriate approximately $500 million of offshore cash into the United States. As a result, Plexus has established a revised capital allocation plan that is intended to fund growth investments, reduce debt, reward our employees and enhance shareholder value. A summary of the capital allocation plan is summarized below:
Plexus expects to pay down its existing debt balance held under its revolving credit facility. Eliminating the current debt balance will provide Plexus the full capacity of the revolving credit facility to support future growth investments.
Plexus has $175 million of senior notes that mature in June 2018. To further reduce debt, Plexus intends to refinance up to $150 million of the senior notes in an effort to lower interest expense while maintaining leverage on the balance sheet.
In June 2016, Plexus announced a three year, $150 million share repurchase authorization (referred to as the “2016 Share Repurchase Plan”). Under this authorization, Plexus has purchased approximately $44 million of shares through its fiscal first quarter 2018. Under Plexus’ revised capital allocation plan, Plexus intends to accelerate the repurchases under the 2016 Share Repurchase Plan and complete the remaining $106 million of authorized purchases in fiscal 2018 through open market purchases.
Plexus’ Board of Directors has approved a new share repurchase authorization, commencing upon completion of the 2016 Share Repurchase Plan, in the amount of $200 million. Shares would be purchased through the open market, on a relatively consistent basis, with the intent to complete the repurchases in fiscal 2019.
In order to reward employees for their contributions towards Plexus’ success, Plexus will provide existing, full-time, non-executive employees a one-time cash bonus. This bonus will be provided in the fiscal second quarter to nearly 16,000 employees, totaling approximately $13 million.
Todd Kelsey, president and CEO, commented, “We view the recent U.S. tax reform as immensely beneficial for Plexus. Through the reform, Plexus now has the ability to repatriate our current and future offshore cash in a significantly more tax-efficient manner. Access to this cash will enable us to support our growth prospects, improve our capital structure and reward our shareholders. Further, I am pleased to share this benefit with our employees. It is their commitment to Customer Service Excellence that has enabled Plexus to be an industry leader.”
Patrick Jermain, senior vice president and CFO, commented, “We believe that our new capital allocation plan provides the opportunity to create significant value for our shareholders by allowing us to reduce debt while returning cash to our shareholders. As a result of our ability to better access our cash in an ongoing manner, we will be in a position to regularly return a targeted amount of our free cash flow to shareholders.”
Mr. Kelsey concluded, “Investing in the company to meet the growing demands of our customers is a top priority for us. Over the past year we have announced investments in our engineering business, including new facilities in Neenah, Wisconsin and Boulder, Colorado and an expanded space within our Oradea, Romania facility. Further, we announced the acquisition of a new manufacturing facility adjacent to our Riverside facility in Penang, Malaysia. Given our current revenue growth expectations, we are optimistic that there will be additional opportunities, in the U.S. and across the globe, to support customer needs and further expand our business.”
About Plexus
Since 1979, Plexus has been partnering with companies to create the products that build a better world. We are a team of over 16,000, providing global Design and Development, Supply Chain Solutions, New Product Introduction, Manufacturing, and Aftermarket Services. Plexus is an industry leader that specializes in serving customers with complex products used in demanding regulatory environments. With a culture built around innovation and customer service, Plexus’ teams create customized end-to-end solutions to assure the realization of the most intricate products. For more information about Plexus, click here.
Share on:
Testimonial
"Our marketing partnership with I-Connect007 is already delivering. Just a day after our press release went live, we received a direct inquiry about our updated products!"
Rachael Temple - AlltematedSuggested Items
ESD Alliance Reports Electronic System Design Industry Posts $5.5 Billion in Revenue in Q4 2025
04/15/2026 | SEMIElectronic System Design (ESD) industry revenue increased 10.3% to $5,466.3 million in the fourth quarter of 2025 from the $4,955.2 million registered in the fourth quarter of 2024, the ESD Alliance, a SEMI Technology Community, announced today in its latest Electronic Design Market Data (EDMD) report.
Punching Out: How Many PCB Companies Are There in North America Now?
03/19/2026 | Tom Kastner -- Column: Punching Out!When I am asked how many PCB shops are still in the U.S., my answer is usually, “About 130. How many do you want to buy?” However, I do not really know the number. My job is either to sell PCB shops or help people buy them, not to count them. I probably should keep better track of them, but many are small (70% have revenue below $10 million), or they say they are making boards even if they rent out their facility as an auto repair shop.
EIPC Winter Conference 2026 Review: The Keynote Sessions
02/11/2026 | Pete Starkey, I-Connect007Aix-en-Provence (pronounced “ex-ahn-pro-vonse”), a historic city and commune in the south of France, about 20 miles north of Marseille, was the pleasant venue for EIPC’s Winter Conference in early February. Industry delegates from 11 European countries, as well as from the U.S. and China, gathered at the Renaissance Hotel for a two-day programme, “Driving the Future: Innovation, Energy, and Sustainability in PCB Technology.” An added attraction was a privileged visit to the ITER fusion power project at the Cadarache research and development centre.
SMTA Space Coast: What's Needed to Modernize Defense Solder Standards
12/23/2025 | Nolan Johnson, I-Connect007Long-time lead-free solder investigator, Denny Fritz, hit the SMTA Space Coast Expo in November to drum up support for an initiative to include lead-free solder in milaero-based printed circuit board assemblies. In this interview, Denny provides background on the genesis of the “consider all solders” project and why it matters to continue leading this effort.
I-Connect007 Editor’s Choice: Five Must-Reads for the Week
11/28/2025 | Nolan Johnson, I-Connect007Yesterday was the U.S. Thanksgiving holiday. The traditional meal is, of course, roast turkey with “all the trimmings.” Although not everyone observes that menu, most do, and it was reported that 42 million turkeys were consumed on that day. With an average weight of 16 pounds per turkey, we cooked up 672 million pounds! With approximately 342 million people in the U.S, that pencils out to just under two pounds of drumstick and white meat per person. That, my friends, is a whole lot of leftovers.