UBS Global Technology and Services Conference

Transcription

1 UBS Global Technology and Services Conference June 8 th

2 Risks and Non-GAAP Disclosures This presentation contains forward-looking statements within the meaning of U.S. securities laws, including statements related to revenue and earnings guidance; our expectations about our future operating margins and return on invested capital; expected revenue growth in our market segments; expected improvements in profitability of our components business units; our expectations about the availability of components for our products; the expected charges and savings associated with our restructuring activities; and our expectations regarding end market demand for our products and our business in the current economic environment. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those anticipated by these statements; are based on our current expectations; and we assume no obligation to update them. Information about these risks is noted on slide 16 of this presentation, and in the Risk Factors and MD&A sections of our latest annual and quarterly reports filed with the SEC, as well as in our other SEC filings. Investors are cautioned not to place undue reliance on these forwardlooking statements. In this presentation we reference both GAAP and non-gaap financial measures. Please refer to the GAAP vs. non-gaap reconciliation in the Investors section of our website, which contain the reconciliation to the most directly comparable GAAP measures. 2

3 Flextronics: A Global Technology Supply Chain Enabler ~$24 Billion in Annual Sales ~200,000+ Employees Globally; ~20,000 Logistics/Services ~120,000 Employees in Asia (~90,000 in China) Operating in 30 Countries; 27M Sq Ft of Capacity; 9 Industrial Parks 3

4 Flextronics Our Service Model Design. Build. Ship. Service. Flextronics employs over 4,000 design engineers. Flextronics owns 364 patents Capabilities Industrial Design System Architecture Mechanical Design Embedded System Design Software Systems Product Launch/NPI DFx Services Flextronics runs 9 industrial parks around the world focused on building the worlds leading technology products. Capabilities PCB/Flex Circuits Optomechatronics LCD Displays Cables Machining Plastics Metal Fabrication SMT Assembly System Integration and Final Test Flextronics is involved in doing BTO and CTO for many of the most complex technology products in the world from industry leading companies such as Cisco, HP, Huawei, Lenovo, RIM, Juniper, and many others. Capabilities Build-to-Order (BTO) Configure-to-Order (CTO) Distribution and Direct Fulfillment Outbound Logistics and Hubbing Flextronics Global Services is the global repair leader for electronic products servicing 3M cell phones, 2M laptops, 9M PCBA s, and 2M game consoles phones per year. RTS Technicians (i.e. within Verizon stores) handle 600,000+ customer transactions per month. Global Services sites dedicated to Service Parts Logistics process and ship over 12M spare parts for customers every year. Capabilities Repair/ Refurbishment and Warranty Support Service Parts Logistics Remarketing Retail Technical Services (RTS) Asset Recovery Reverse Logistics 4

5 We have three major groups of business 5

6 Go-to-Market Strategy: Market Segments + Business Unit Verticals Our dedicated segment teams provide integrated solutions and services that span the full product lifecycle, from design to manufacturing to distribution and after-market services Market Segments and % of total Q4 10 revenue Infrastructure Segment 30% Mobile Segment 19% Consumer Digital Segment 10% Computing Segment 20% Industrial & Other Segment 21% Business Units Multek Vista Point FlexPower Global Services Retail Technical Services 6

7 Geographic Diversification Our global scale and flexibility are key competitive advantages Customers increasingly require solutions that can only be achieved through significant global scale and lower cost We restructured our global operations to gain efficiencies by shifting manufacturing capacity to different locations We leverage our worldwide supplier relationships to gain advantageous pricing and supply chain flexibility for customers Operations in 30 countries across 4 continents 19% Operations revenue breakout by country: Asia Fiscal 2010 % of Sales China $7,956,542 33% Singapore $428,000 2% Malaysia $2,652,181 11% Other Asia $558,678 2% Americas Fiscal 2010 % of Sales U.S. $3,375,503 14% Mexico $3,616,610 15% Other Americas $838,922 3% Europe Fiscal 2010 % of Sales Europe $4,684,297 19% Total $24,110, % 14% 15% 11% 33% * Per 10-K filed for the annual period ended

8 Globally Diverse Industrial Parks a Powerful Differentiator Sustainable Growth Limitless Scale, Repeatable Execution Americas Guadalajara, Mexico Juarez, Mexico Sorocaba, Brazil Europe Tczew, Poland East Hungary West Hungary Asia Chennai, India Doumen, PRC Shanghai, PRC 8

9 Flextronics Zhuhai, China North Campus Plastics, Metal and Assembly PCB Fab PCB Fab PCB Fab Rigid Flex & Flex Circuit Plastics and Metal Mechanical Assembly PCB Assembly Cafeteria Expansion PCB Assembly Central Warehouse Bonded Warehouse 9

10 Continuously Expand the Total Available Market (TAM) Traditional EMS Total Available Market ($B) PCB Power LCD Displays Optomechatronics Services Computing ODM Clean Tech TOTAL 10

11 IDC s EMS and ODM Industry Revenue Growth Forecast EMS + ODM Revenues US$ (Bil) $350 $300 $250 $200 $191 $229 $267 $280 $ E CAGR: 9.6% $274 $249 $300 $328 $ Source: IDC 11

12 Flextronics Revenue Growth FY94 FY11E US$ (Mil) $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 FY94 FY95 FY96 FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 *FY11 Revenue ,498 2,578 3,953 6,959 12,110 13,105 13,379 14,530 15,731 15,288 18,854 27,558 30,949 24,111 27,246 Revenue growth has returned and at a strong pace *FY11 Source: First Call consensus estimates 12

13 Revenue Growth Expectations FY10 FY11 Segments Infrastructure Industrial Medical Computing Mobile & Consumer Multek Optomechatronics Power Services 5 10 % % > 20 % Key Customers Broad based infrastructure market penetration Impressive growth across existing and emerging industrial markets Servers driving some downside, being increasingly selective on ODM Multek growing all businesses successfully Remaining segments on plan 13

14 Investor Contact Information: Warren Ligan Senior Vice President Treasury and Investor Relations Kevin Kessel Vice President Investor Relations

15 Thank You 15

16 Risk Factors RISKS INCLUDE: That future revenue and earnings may not be achieved as expected. The risks to our particular electronics and technology sector of economic instability and a slowdown in consumer spending, particularly given the current economic conditions. The effects of customer or supplier bankruptcies or insolvency. Supply shortages of required electronic components. The effects that current credit and market conditions could have on the liquidity and financial condition of customers or suppliers, including any impact on their ability to meet contractual obligations to us on terms and conditions previously negotiated. The effects of the current macroeconomic environment could have on our liquidity and ability to access credit markets. Our dependence on industries that continually produce technologically advanced projects with short life cycles. Our ability to respond to changes in economic trends, to fluctuations in demand for customers products and to the short term nature of our customers commitments. Competition in our industry, particularly from ODM suppliers in Asia. Our dependence on a small number of customers for the majority of our sales and our reliance on strategic relationships with major customers. The challenges of effectively managing our operations, including our ability to manage manufacturing processes, control costs and manage changes in our operations. The challenges of integrating acquired companies and assets. Not obtaining anticipated new customer programs, or if we do obtain them, that they may not contribute to our revenue or profitability as expected or at all. Our ability to utilize available manufacturing capacity. The risk of future restructuring charges that could be material to our financial condition and results of operations. Our ability to design and quickly introduce world-class components products that offer significant price and/or performance advantages over competitive products. The impact on our margins and profitability resulting from substantial investments, start-up and integration costs in our components, design and ODM businesses; and production difficulties, especially with new products. Changes in government regulations and tax laws including any effects related to the expiration of tax holidays. Our exposure to potential litigation relating to intellectual property rights, product warranty and product liability. Our dependence on the continued trend of outsourcing by OEMs. The challenges of international operations, including fluctuations in exchange rates beyond hedged boundaries leading to unexpected charges. Our dependence on our key personnel. Our ability to comply with environmental laws. Further information concerning these and other risk factors that could cause actual results to differ materially from those in the forward looking statements is contained in the Risk Factors and Management s Discussion and Analysis sections of our reports on forms 10-Q and 10-K as well as the other reports that we file with the US. Securities and Exchange Commission. 16