Aligns Fiscal Year 2024 Financial Outlook to
Reflect Close, Business Outlook Unchanged
Jabil Inc. (NYSE: JBL) announced today the closing of the
transaction to divest its Mobility business to BYD Electronic
(International) Company Limited (“BYDE”) in a cash transaction
valued at $2.2 billion. The company previously announced the
signing of a definitive agreement for the transaction on September
26, 2023.
“We are pleased to successfully close this transformational deal
and I am confident that this is the right step forward for Jabil,”
said CEO Kenny Wilson. “The net proceeds will enable us to enhance
our shareholder-centric capital framework, including incremental
share buybacks. Additionally, it will provide opportunities for
further investment in key areas of our business.”
Q2 Fiscal Year 2024 Outlook:
As stated, for modeling purposes, the second quarter guidance
provided by the Company on December 14, 2023, assumed a January 31,
2024, close date for the mobility divestiture. With the transaction
closing earlier, Jabil now anticipates the midpoint of the prior
guidance range for net revenue and core earnings per share for the
second quarter to be lower by approximately $400 million and $0.30,
respectively, which aligns with the expectations the company
outlined on its first quarter earnings call.
Prior Q2 FY24
Outlook
Updated Q2 FY24
Outlook
Net revenue
$7.0 billion - $7.6 billion
$6.6 billion - $7.2 billion
U.S. GAAP operating income (1)
$216 million - $301 million
$168 million - $253 million
U.S. GAAP diluted earnings per share
(1)
$0.77 - $1.37 per diluted share
$0.47 - $1.07 per diluted share
Core operating income (non-GAAP) (2)
$339 million - $399 million
$291 million - $351 million
Core diluted earnings per share (non-GAAP)
(2)
$1.73 - $2.13 per diluted share
$1.43 - $1.83 per diluted share
(1)
Excludes the anticipated gain on
the divestiture of the Mobility business.
(2)
Core operating income and core
diluted earnings per share exclude anticipated adjustments of $6
million for amortization of intangibles (or $0.05 per diluted
share), $17 million for stock-based compensation expense and
related charges (or $0.13 per diluted share) and $100 million to
$75 million (or $0.78 to $0.58 per diluted share) for
restructuring, severance, and related charges.
Fiscal Year 2024 Outlook:
“I am delighted to close the transaction and receive the net
proceeds ahead of schedule,” said CFO Mike Dastoor. “The earlier
close and receipt of funds will enable us to begin initiating plans
to reduce stranded costs and executing a series of accelerated
buybacks throughout FY24. As a result, we expect to fully utilize
our current $2.5 billion dollar repurchase authorization this
fiscal year. These actions give me confidence that we will be able
to offset lower income in Q2 and deliver core earnings for FY24 in
excess of $9 per diluted share.”
Prior FY24
Outlook
Updated FY24
Outlook
Net revenue
$31 billion
$30.6 billion
Core operating margin
5.3% - 5.5%
5.3% - 5.5%
Core diluted earnings per share
(non-GAAP)
$9.00+ per diluted share
$9.00+ per diluted share
Adjusted free cash flow (non-GAAP)
$1+ billion
$1+ billion
(Definitions: “U.S. GAAP” means U.S. generally accepted
accounting principles. Jabil defines core operating income as U.S.
GAAP operating income less amortization of intangibles, stock-based
compensation expense and related charges, restructuring, severance
and related charges, distressed customer charges, acquisition and
integration charges, loss on disposal of subsidiaries, settlement
of receivables and related charges, impairment of notes receivable
and related charges, goodwill impairment charges, business
interruption and impairment charges, net and costs from the
divestiture of businesses plus other components of net periodic
benefit cost. Jabil defines core earnings as core operating income,
less loss on debt extinguishment, loss (gain) on securities, other
components of net periodic benefit cost, income (loss) from
discontinued operations, gain (loss) on sale of discontinued
operations and certain other expenses, net of tax and certain
deferred tax valuation allowance charges. Jabil defines core
diluted earnings per share as core earnings divided by the weighted
average number of outstanding diluted shares as determined under
U.S. GAAP. Jabil defines adjusted free cash flow as net cash
provided by (used in) operating activities less net capital
expenditures (acquisition of property, plant and equipment less
proceeds and advances from sale of property, plant and equipment).
Jabil reports core operating income, core earnings, core diluted
earnings per share and adjusted free cash flow to provide investors
an additional method for assessing operating income, earnings,
diluted earnings per share and free cash flow from what it believes
are its core manufacturing operations. See the accompanying
reconciliation of Jabil’s core operating income to its U.S. GAAP
operating income, its calculation of core earnings and core diluted
earnings per share to its U.S. GAAP net income and U.S. GAAP
earnings per share and additional information in the supplemental
information.)
Forward Looking Statements: This release contains
forward-looking statements, including those regarding our guidance
for future financial performance in our second quarter of fiscal
year 2024 (including, net 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) results and the
components thereof, including but not limited to amortization of
intangibles, stock-based compensation expense and related charges
and restructuring, severance and related charges) and our full year
2024 (including net revenue, core operating margin (Non-GAAP), core
diluted earnings per share (Non-GAAP) results and the components
thereof and adjusted free cash flow (non-GAAP)), those related to
our financial priorities and the future components of our expected
capital structure and allocation, our expectations with respect to
stock repurchase activities, including their timing, our plans to
reduce costs, and those regarding the expected financial impact of
the sale of the Mobility business to BYD Electronic (International)
Company Limited (“BYDE”). The statements in this release 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. Forward-looking
statements could be affected by the following factors, among
others, unexpected costs or unexpected liabilities that may arise
from the Mobility transaction; scheduling production, managing
growth and capital expenditures and maximizing the efficiency of
our manufacturing capacity effectively; managing rapid declines or
increases in customer demand and other related customer challenges
that may occur; the effect of COVID-19 on our operations, sites,
customers and supply chain; our dependence on a limited number of
customers; our ability to purchase components efficiently and
reliance on a limited number of suppliers for critical components;
risks arising from relationships with emerging companies; changes
in technology and competition in our industry; 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; risks associated
with international sales and operations, including geopolitical
uncertainties; energy price increases or shortages; our ability to
achieve expected profitability from acquisitions; risk arising from
our restructuring activities; issues involving our information
systems, including security issues; regulatory risks (including the
expense of complying, or failing to comply, with applicable
regulations; risk arising from design or manufacturing defects;
risk arising from compliance, or failure to comply, with
environmental, health and safety laws or regulations and
intellectual property risk); financial risks (including customers
or suppliers who become financially troubled; turmoil in financial
markets; tax risks; credit rating risks; risks of exposure to debt;
currency fluctuations; and asset impairment); changes in financial
accounting standards or policies; risk of natural disaster, climate
change or other global events; and risks arising from expectations
relating to environmental, social and governance considerations.
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, 2023, and our other filings with the Securities and Exchange
Commission. We assume no obligation to update these forward-looking
statements.
About Jabil:
At Jabil (NYSE: JBL), we are proud to be a trusted partner for
the world's top brands, offering comprehensive engineering,
manufacturing, and supply chain solutions. With over 50 years of
experience across industries and a vast network of over 100 sites
worldwide, Jabil combines global reach with local expertise to
deliver both scalable and customized solutions. Our commitment
extends beyond business success as we strive to build sustainable
processes that minimize environmental impact and foster vibrant and
diverse communities around the globe. Discover more about us at
www.jabil.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20231229234188/en/
Investor Contact Adam Berry Vice President, Investor
Relations adam_berry@jabil.com
Media Contact Timur Aydin Director, Enterprise Content
and Media publicrelations@jabil.com
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