Jabil Releases Third Quarter Results

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Jabil Circuit Inc. has reported preliminary, unaudited financial results for its third quarter of fiscal year 2016, including third quarter net revenue of $4.3 billion.

U.S. GAAP operating income for the third quarter was $59.6 million and U.S. GAAP net diluted earnings per share was $0.03. Core operating income was $87.2 million and core diluted earnings per share was $0.17.

"Our Electronics Manufacturing Services business performed ahead of plan supported by near-perfect execution during the quarter," said CEO Mark Mondello. "However as expected, our third quarter results also reflected a soft environment within our mobility business. These challenges will continue to negatively impact our Diversified Manufacturing Services business for the balance of our fiscal year."

Fiscal Year 2016 Fourth Quarter Guidance

• Net revenue: $4.15 billion to $4.35 billion
• U.S. GAAP operating income: $60 million to $92 million
• U.S. GAAP net diluted (loss) earnings per share: ($0.02) to $0.19 per diluted share
• Core operating income: $95 million to $125 million
• Core diluted earnings per share: $0.15 to $0.35 per diluted share
• Diversified Manufacturing Services: Decrease net revenue 20 percent year-on-year
• Electronics Manufacturing Services: Consistent net revenue year-on-year
• Total company: Decrease net revenue 9 percent year-on-year

Management updated the fiscal year 2016 revenue outlook to approximately $18.2 billion; U.S. GAAP net diluted earnings per share outlook to approximately $1.20 and core diluted earnings per share outlook to approximately $1.85.

As part of a framework to increase capital returns to shareholders over the next two fiscal years, Jabil's Board of Directors authorized a $400 million share repurchase program. The overarching capital allocation framework is designed to return approximately 40% of cash flows from operations through dividends and share repurchases over the next two years, not to exceed $1 billion in total.

"This framework announced today reflects our confidence in our ability to generate in excess of $2 billion of cash flows from operations over the next two fiscal years," said CFO Forbes I.J. Alexander. "Moving ahead, we remain confident in our ability to effectively leverage our asset base, maintain relationships with both new and existing customers and grow earnings per share."