Re sults for Q4 F isc al 2020 E a rning s Anno unc e me nt: Ma y - - PowerPoint PPT Presentation

Re sults for Q4 F isc al 2020

E a rning s Anno unc e me nt: Ma y 7, 2020 (Qua rte r E nde d Ma rc h 31, 2020)

1 1

Risks and Non- GAAP Disc losur e s

T his pre se nta tio n c o nta ins fo rwa rd-lo o king sta te me nts within the me a ning o f U.S. se c uritie s la ws, inc luding sta te me nts re la te d to future e xpe c te d re ve nue s a nd e a rning s pe r sha re a nd me a sure s tha t we a re ta king to re spo nd to the c ha lle ng e s pre se nte d b y the COVI D-19 pa nde mic a nd the re sulting e c o no mic disruptio ns. T he se fo rwa rd-lo o king sta te me nts invo lve risks a nd unc e rta intie s tha t c o uld c a use the a c tua l re sults to diffe r ma te ria lly fro m tho se a ntic ipa te d b y the se fo rwa rd-lo o king sta te me nts. Re a de rs a re c a utio ne d no t to pla c e undue re lia nc e o n the se fo rwa rd-lo o king sta te me nts. T he se risks inc lude : the e ffe c ts o f the COVI D-19 pa nde mic o n o ur b usine ss, re sults o f o pe ra tio ns a nd fina nc ia l c o nditio n; tha t future re ve nue s a nd e a rning s ma y no t b e a c hie ve d a s e xpe c te d; the e ffe c ts tha t the c urre nt ma c ro e c o no mic e nviro nme nt c o uld ha ve o n

• ur b usine ss a nd de ma nd fo r o ur pro duc ts; the e ffe c ts tha t c urre nt c re dit a nd ma rke t c o nditio ns c o uld ha ve o n the liq uidity a nd fina nc ia l c o nditio n o f o ur c usto me rs a nd supplie rs, inc luding a ny impa c t o n the ir a b ility

to me e t the ir c o ntra c tua l o b lig a tio ns; the c ha lle ng e s o f e ffe c tive ly ma na g ing o ur o pe ra tio ns, inc luding o ur a b ility to c o ntro l c o sts a nd ma na g e c ha ng e s in o ur o pe ra tio ns; litig a tio n a nd re g ula to ry inve stig a tio ns a nd pro c e e ding s; c o mplia nc e with le g a l a nd re g ula to ry re q uire me nts; the po ssib ility tha t b e ne fits o f the Co mpa ny’ s re struc turing a c tio ns ma y no t ma te ria lize a s e xpe c te d; tha t the e xpe c te d re ve nue a nd ma rg ins fro m re c e ntly la unc he d pro g ra ms ma y no t b e re a lize d; o ur de pe nde nc e o n a sma ll numb e r o f c usto me rs; the impa c t o f c o mpo ne nt sho rta g e s, inc luding the ir impa c t o n o ur re ve nue s; g e o po litic a l risk, inc luding the te rmina tio n a nd re ne g o tia tio n o f inte rna tio na l tra de a g re e me nts a nd tra de po lic ie s, inc luding the impa c t o f ta riffs a nd re la te d re g ula to ry a c tio ns; a nd tha t re c e ntly pro po se d c ha ng e s o r future c ha ng e s in ta x la ws in c e rta in jurisdic tio ns whe re we o pe ra te c o uld ma te ria lly impa c t o ur ta x e xpe nse . I n a dditio n, the COVI D-19 pa nde mic inc re a se s the like liho o d a nd po te ntia l se ve rity o f ma ny o f the fo re g o ing risks. T he ma king o f a ny sta te me nt in o ur pre se nta tio n do e s no t c o nstitute a n a dmissio n b y F le x o r a ny o the r pe rso n tha t the e ve nts o r c irc umsta nc e s d e sc rib e d in suc h sta te me nt a re ma te ria l. Additio na l info rma tio n c o nc e rning the se a nd o the r risks is de sc rib e d unde r “Risk F a c to rs” a nd “Ma na g e me nt’ s Disc ussio n a nd Ana lysis o f F ina nc ia l Co nditio n a nd Re sults o f Ope ra tio ns” in o ur a nnua l re po rt o n F

• rm 10-

K fo r the fisc a l ye a r e nde d Ma rc h 31, 2019 a nd o ur q ua rte rly re po rts o n F

• rm 10-Q fo r the fisc a l q ua rte rs e nde d Se pte mb e r 27, 2019 a nd De c e mb e r 31, 2019, a nd in the risk fa c to r inc lude d in o ur Curre nt Re po rt o n F
• rm

8-K da te d Ma y 7, 2020. T he fo rwa rd-lo o king sta te me nts in this pre ss re le a se a re b a se d o n c urre nt e xpe c ta tio ns a nd F le x a ssume s no o b lig a tio n to upda te the se fo rwa rd-lo o king sta te me nts. Our sha re re purc ha se pro g ra m do e s no t o b lig a te the Co mpa ny to re purc ha se a spe c ific numb e r o f sha re s a nd ma y b e suspe nde d o r te rmina te d a t a ny time witho ut prio r no tic e . Ple a se re fe r to the a ppe ndix se c tio n o f this pre se nta tio n fo r re c o nc ilia tio n o f the No n-GAAP fina nc ia l me a sure s to the mo st dire c tly c o mpa ra b le GAAP me a sure s. I f this pre se nta tio n re fe re nc e s histo ric a l no n-GAAP fina nc ia l me a sure s, the se me a sure s a re lo c a te d o n the “I nve sto r Re la tio ns” se c tio n o f o ur we b site , www.fle x.c o m a lo ng with the re q uire d re c o nc ilia tio n to the mo st c o mpa ra b le GAAP fina nc ia l me a sure s. T he fig ure s pre se nte d in this pre se nta tio n ha ve b e e n ro unde d. T his ma y le a d to individua l va lue s no t a dding up to the to ta ls pre se nte d. T he fo llo wing b usine ss se g me nt a c ro nyms will b e use d thro ug ho ut this pre se nta tio n:

Communic a tions a nd E nte rprise Compute

Clo ud Da ta Ce nte r, Co mmunic a tio ns, Ne two rking , Se rve r & Sto ra g e .

Consume r T e c hnolog ie s Group

I

• T
• E

na b le d De vic e s, Audio a nd Co nsume r Po we r E le c tro nic s, Mo b ile De vic e s, Supply Cha in So lutio ns fo r PCs, T a b le ts, a nd Printe rs.

Industria l a nd E me rg ing Industrie s

Ca pita l E q uipme nt, Offic e So lutio ns, Ho use ho ld I ndustria l & L ife style , I ndustria l Auto ma tio n & K io sks, E ne rg y & Me te ring , L ig hting .

HRS

Hig h Re lia bility Solutions

He a lth Solutions: Co nsume r He a lth,

Me dic a l Dispo sa b le s, Drug De live ry & Me dic a l E q uipme nt, Dig ita l He a lth.

Automotive : Auto no mo us, Co nne c tivity,

E le c trific a tio n, Sma rt T e c hno lo g ie s.

IE I CE C CT G

2

Re va thi Adva ithi, CE O

Busine ss Update

3 3

E na bling c ritic a l produc tion

• Ra mpe d pro duc tio n o n

me dic a l e q uipme nt suc h a s

• xyg e n c o nc e ntra to rs, ho spita l

b e ds, infusio n pumps, a nd dia g no stic de vic e s

• Be g a n pro duc tio n o f ve ntila to rs

a nd ma sks in Q4

• Re c e ive d a nd e va lua te d 50+

ne w inb o und me dic a l pro g ra ms

• De dic a ting re so urc e s to

a c c e le ra ting me dic a l pro duc t ra mps to 6-12 we e ks

COVID- 19 Update

E mploye e he a lth a nd sa fe ty is pa ra mount

• 6 millio n+ e mplo ye e

sc re e ning s c o mple te d to - da te

• E

nha nc e d dista nc ing a nd sa nita tio n pro to c o l

• Ma nda to ry wo rk fro m ho me

po lic ie s e nfo rc e d in jurisdic tio ns whe re ne e de d

• F

ina nc ia lly a ssisting a ffe c te d e mplo ye e s thro ug h F le x F

• unda tio n o utre a c h

Sig nific a nt a c tions to- da te inc lude :

• E

a rly re spo nsive ne ss in China a llo we d q uic k re plic a tio n o f he a lth a nd sa fe ty pro to c o l a c ro ss g lo b a l site s

• Co o rdina tio n with lo c a l a nd na tio na l o ffic ia ls to c o ntinue c ritic a l pro duc tio n o f e sse ntia l pro duc ts
• T
• o k ste ps to pre se rve c a sh a nd liq uidity in lig ht o f c urre nt e c o no mic c o nditio ns

Custome r a nd supplie r support

• 100% o f China wo rkfo rc e

re turne d to site s

• Mo nito ring o ng o ing disruptio ns

in c e rta in g e o g ra phie s suc h a s I ndia a nd Ma la ysia

• Ob ta ine d e sse ntia l pro duc tio n

wa ive rs fo r ma jo rity o f site s in a ffe c te d c o untrie s

• Ma na g ing thro ug h e le va te d

le a d time s fo r c e rta in c o mpo ne nts

Prio ritizing e mplo ye e he a lth a nd sa fe ty a nd pa rtne ring with c usto me rs a nd supplie rs to a ddre ss

• ng o ing c ha lle ng e s

F ina nc ia l stre ng th

• Ample liq uidity a nd stro ng

b a la nc e she e t

• Cre a te d le a ne r
• rg a niza tio n thro ug ho ut

F Y20 with ta rg e te d SG&A e ffic ie nc ie s

• Busine ss struc ture d to

de live r fre e c a sh flo w during e c o no mic do wnc yc le s

• Ma inta ining inve stme nt

g ra de ra ting re ma ins c o rpo ra te o b je c tive

4 4

Ope r ating in a Dynamic E nvir

• nme nt

Our Pe r spe c tive

Supply c ha in disruption

• Supplie rs impa c te d de c line d 80% fro m F

e b 14 pe a k

• Co mpo ne nt sho rta g e s de c re a se d sig nific a ntly fro m F

e b 22 pe a k

• L

e ve ra g ing pre fe rre d pa rtne r sta tus with supplie rs to e nsure inve nto ry a nd supply c o ntinuity

• Co ntinuing to ide ntify a lte rna te so urc e s o f supply

Ope ra tiona l disruption

• Mo st site s running witho ut ma jo r b usine ss impa c t
• Ac tive ly mo nito ring a nd a da pting in Ma la ysia , I

ndia , Me xic o a nd Bra zil a s COVI D-19 situa tio n e vo lve s

• Co ntinuing to a c tive ly ma na g e va ria b le c o st ma na g e me nt
• No c o untry re pre se nts >25% o f g lo b a l PP&E

a nd pro duc tio n c a n b e shifte d b e twe e n site s a s ne e de d

T ho ug htfully sta ying nimb le in a to ug h e nviro nme nt

5 5

Q4 F Y2020 F inanc ial Summar y

119 238

• ADJ. F

RE E CASH F L OW

($M)

129 134 256 256 3.7% 4.0%

• ADJ. OPE

RAT I NG I NCOME

($M)

• Adj. Ope ra ting

Ma rg in

204 207 3.3% 3.8% 6,923 6,226 6,461 5,484

Q2 Q3

RE VE NUE

($M)

$0.34 $0.27 $0.38 $0.28

18-Se p 19-Se p

• ADJ. E

ARNI NGS PE R SHARE

$0.34

De c -18 De c -19 Ma r-19 Ma r-20 De c -18 De c -19 Ma r-19 Ma r-20 De c -18 De c -19 Ma r-19 Ma r-20 De c -18 De c -19 Ma r-19 Ma r-20

Po rtfo lio ma na g e me nt a nd o pe ra tio na l disc ipline de live re d stro ng pro fita b ility a nd c a sh flo w

6 6

F isc al 2020 F inanc ial Summar y and Highlights

3 672 0% 106%

F Y19 F Y20

• Adj. F

CF Co nve rsio n

• ADJ. F

RE E CASH F L OW

($M)

872 898 3.3% 3.7%

F Y19 F Y20

• Adj. Ope ra ting Ma rg in
• ADJ. OPE

RAT I NG I NCOME

($M)

26,211 24,210

F Y19 F Y20

RE VE NUE

($M)

1.14 1.23

F Y19 F Y20

• ADJ. E

ARNI NGS PE R SHARE

Dr ive disc ipline d, susta ina b le e xe c utio n Manage po rtfo lio to impro ve mix a nd pro fita b ility Pur sue de sig n-le d ma nufa c turing fo r b e tte r ma rg ins Gr

• w

drive pro fita b le g ro wth a nd ma rke t le a de rship Ge ne r ate a djuste d F CF with prude nt c a pita l a llo c a tio n

Guide d by c onsiste nt busine ss pr inc iple s

7 7

F Y20 Highlights and Ac c omplishme nts

E xe c uting to our longe r

• te r

m str ate gy

4 q ua rte rs ye a r-o ve r-ye a r

• Adj. Gro ss Ma rg in e xpa nsio n

7 q ua rte rs ye a r-o ve r-ye a r

• Adj. Ope ra ting Ma rg in e xpa nsio n

6 q ua rte rs o f >$100M

• Adj. F

re e Ca sh F lo w g e ne ra tio n

• Ac hie ve d a djuste d E

PS within the o rig ina l ra ng e o f F Y20 g uida nc e de spite pa nde mic -re la te d dislo c a tio ns

• Displa ye d 23% Y/ Y g ro wth in I

E I se g me nt

• Stro ng b o o king s in Auto mo tive ($700M), He a lth So lutio ns

($851M) a nd I ndustria l ($1.2B)

• E

limina te d no n-stra te g ic a c tivitie s a nd re fo c use d c a pita l a nd re so urc e s

• Dise ng a g e d fro m o ve r $1.2B o f lo w ma rg in, hig h vo la tility

b usine ss

• E

nha nc e d o ur o rg a niza tio n to drive rig o ro us pro c e sse s a nd e xe c utio n fo c us: stra te g y, struc ture , a nd re a lig ne d inc e ntive s

• Asse sse d o ur ta rg e ts, c a pa b ilitie s a nd c ulture a nd unve ile d ne w

stra te g ic dire c tio n a t Ma rc h 2020 I nve sto r a nd Ana lyst Da y

8

Chris Co llie r, CF O

Q4 2020 F inanc ial Re sults

9 9

Q4 F Y2020 Inc ome State me nt Summar y

($M, e xc e pt pe r sha re a mo unts)

Pr ior Yr Cur r e nt Qtr

Ma rc h 31, 2019 Ma rc h 31, 2020

Ne t sa le s $6,226 $5,484 Adjuste d o pe ra ting inc o me 204 207 Adjuste d ne t inc o me 141 143 Adjuste d E PS $0.27 $0.28 GAAP inc o me (lo ss) b e fo re inc o me ta xe s ($36) $45 GAAP ne t inc o me (lo ss) (64) 48 GAAP E PS (lo ss) ($0.12) $0.10

Po rtfo lio ma na g e me nt a nd o pe ra tio na l disc ipline de live re d stro ng pro fita b ility

10 10

Quar te r ly F inanc ial Highlights

408 392 6.6% 7.1%

2.5% 2.6% 2.7% 2.8% 2.9% 3.0% 3.1% 3.2% 3.3% 3.4% 3.5% 3.6% 3.7% 3.8% 3.9% 4.0% 4.1% 4.2% 4.3% 4.4% 4.5% 4.6% 4.7% 4.8% 4.9% 5.0% 5.1% 5.2% 5.3% 5.4% 5.5% 5.6% 5.7% 5.8% 5.9% 6.0% 6.1% 6.2% 6.3% 6.4% 6.5% 6.6% 6.7% 6.8% 6.9% 7.0% 7.1% 7.2% 7.3% 7.4% 7.5% 7.6% 7.7% 7.8%

Ma r-19 Ma r-20

• ADJ. GROSS PROF

I T

($M)

• Adj. Gro ss Ma rg in

204 185 3.3% 3.4%

Ma r-19 Ma r-20

% o f Re ve nue

204 207 3.3% 3.8%

Ma r-19 Ma r-20

• Adj. Ope ra ting Ma rg in
• ADJ. SG&A

($M)

• ADJ. OPE

RAT I NG I NCOME

($M)

Co ntinue d ma rg in e xpa nsio n a nd impro ve d pro fita b ility

11 11

E XI ST I NG SE GME NT S

Re ve nue

• Adj. Ope r

ating Inc ome & Mar gin

($M) Y/ Y Gro wth ($M)

HRS

$1,131

• 6%

$63 5.6%

I mpa c te d b y a uto mo tive OE M pro duc tio n a nd China shutdo wns

IE I

$1,866

23%

$134 7.2%

Stre ng th a c ro ss a ll pro duc t c a te g o rie s

CE C

$1,517

• 23%

$31 2.1%

Antic ipa te d we a ke r de ma nd fo r e nte rprise a nd te lc o b usine sse s c o mpo unde d b y virus-re la te d pusho uts

CT G

$971

• 37%

$6 0.6%

Pre ssure d b y o ng o ing po rtfo lio re po sitio ning c o uple d with virus-re la te d supply c o nstra ints

Co rpo ra te Se rvic e s & Othe r*

• ($28)
• T
• tal

$5,484

• 12%

$207 3.8%

Q4 F Y2020 Se gme nt Pe r for manc e

*Co rpo rate Se rvic e s and Othe r: c o rpo rate se rvic e c o sts that are no t inc lude d in the asse ssme nt o f the pe rfo rmanc e o f e ac h o f the ide ntifie d b usine ss g ro ups **Co mpany e xpe c ts to ado pt ne w se g me nt re po rting fo r Q1 F Y21 and is pro viding the se fig ure s fo r illustrative purpo se s.

NE W SE GME NT S**

Re ve nue

• Adj. Ope r

ating Inc ome & Mar gin

($M) ($M)

Re liability

$2,553 $167 6.5%

Agility

$2,931 $68 2.3%

Co rpo ra te Se rvic e s & Othe r*

• ($28)

T

• tal

$5,484 $207 3.8%

12 12

Cash F low Ge ne r ation Highlights

*Ne t Capital E xpe nditure s is c alc ulate d as purc hase s o f pro pe rty and e q uipme nt minus pro c e e ds fro m the dispo sitio n o f pro pe rty and e q uipme nt.

ADJUST E D F RE E CASH F L OW ($M) 129 114 187 238 134

Ma r-19 Jun-19 Se p-19 De c -19 Ma r-20

3- Months E nde d 12- Months E nde d

($M)

(Ma r 31, 2020)

GAAP ne t inc o me $48 $88 De pre c ia tio n, a mo rtiza tio n a nd o the r impa irme nt c ha rg e s 222 748 Cha ng e in wo rking c a pita l a nd o the r (104) (2,370) Co lle c tio ns o n ABS po sitio ns a nd Othe r 51 2,562 Purc ha se s o f pro pe rty & e q uipme nt, ne t (83) (356)

Adjuste d F r e e Cash F low 134 672

Pa yme nts fo r sha re re purc ha se s (87) (260) De b t pa yme nts, ne t 44 (246) Othe r inve sting a nd fina nc ing , ne t 43 60

Ne t c hange in c ash and c ash e quivale nts $134 $226

126 123 95 55 83

Ma r-19 Jun-19 Se p-19 De c -19 Ma r-20

NE T CAPI T AL E XPE NDI T URE S

* ($M)

So lid a djuste d fre e c a sh flo w g e ne ra tio n

13 13

L iquidity and Cash Position Update

433 500 310 600 650 53 66 149 79

CY20 CY21 CY22 CY23 CY24 CY25 CY26 CY27 CY28 CY29 CY30

($M) Balances as of March 31st, 2020

1,923

c ash

1,750

r e volve r

L iq uidity

 T

e rm lo a ns  No te s De bt Pr

• file
• I

nve stme nt g ra de ra te d b y a ll thre e ra ting a g e nc ie s

• F

le xib le a nd b a la nc e d ma turity pro file with no sig nific a nt ne a r-te rm ma turitie s Ac tions to E nhanc e L iquidity

• Suspe nde d sha re re purc ha se s in mid-Ma rc h
• Susta ine d c a pe x b e lo w de pre c ia tio n fo r F

Y20

• Only funding c ritic a l inve stme nts in hig he st ma rg in b usine sse s
• T

e mpo ra ry re duc tio n o f e xe c utive a nd b o a rd c o mpe nsa tio n

• Re duc e d disc re tio na ry c o rpo ra te spe nd suc h a s tra ve l a nd third-

pa rty se rvic e s Cash and L iquidity Manage me nt

• Ample a c c e ss to liq uidity so urc e s
• T
• ta l liq uidity (re vo lve r a nd c a sh) = $3.7B
• $1.75B undra wn re vo lve r with stro ng syndic a te pa rtne rs
• Co mmitte d ABS fa c ility with stro ng syndic a te pa rtne rs

Ke y Cr e dit Me tr ic s De b t/ Adjuste d E BI T DA 2.1x

• Wt. Avg . ma turity ~4.7 ye a rs
• Wt. Avg . c o st o f de b t ~ 4.0%

Stro ng b a la nc e she e t e nsuring a mple liq uidity fo r b usine ss ne e ds

14 14

F ir st Quar te r F isc al 2021 Busine ss Update – June 2020

F le x Re liability Solutions Se gme nt F le x Agility Solutions Se gme nt F le x Company Update

Re ve nue down high single to low double digits Q/ Q

fro m COVI D-19 pro duc tio n disruptio ns, no ta b ly in Ma la ysia a nd I ndia a nd fo r Auto mo tive site s

Ope r ating Mar gin down Q/ Q

due to inc re a se d COVI D-19 c o sts a nd lo we r a b so rptio n le ve ls, o ffse t b y o ng o ing c o st-a lig nme nt a c tio ns

Ope r ational Be ne fits Comme r c ial Be ne fits

Automotive He alth Solutions Communic ations, E nte r pr ise & Cloud Consume r De vic e s L ife style Industr ial

• So ft o ve ra ll de ma nd

in line with lo we r re ta il sa le s a nd c o nsume r spe nding da ta

• Stre ng th in c le a ning

a nd sma ll ho me a pplia nc e pro duc ts c o nsiste nt with c o nsume r sta y-a t- ho me b uying b e ha vio rs

• Ove ra ll o utlo o k

sta b ilizing a t lo we r le ve ls

• I

mpro ve me nt in pro duc tio n c a pa c ity b o o sting shipme nts

• Stre ng th in pro duc ts

suppo rting o nline c o mme rc e infra struc ture b uildo ut

• Ong o ing de ma nd

a nd supply c ha lle ng e s in Mo b ile

• Co mputing o utlo o k

sta b ilizing a t lo we r le ve ls

• Pro duc tio n

sig nific a ntly impa c te d b y OE M shutdo wns in NA a nd E U

• Bro a d vo lume

re duc tio ns a c ro ss pro duc t po rtfo lio

• Co ntinue d fo c us o n

a uto no mo us pro g ra ms

• I

nc re a se d ne a r te rm de ma nd fo r COVI D- 19-re la te d pro duc ts

• Multiple ne w ra mps

in Q1

• Re ne wa b le s

de ma nd up Y/ Y b ut do wn se q ue ntia lly

• Ne a r-te rm

c ha lle ng e s re la te d to c a pe x re duc tio ns a c ro ss a ll ma jo r I ndustria l se g me nts

15 15

Going for war d

• Ma king de e p a nd susta ina b le c ha ng e s to o ur

b usine ss

• Co ntinue to shift mix to a mo re dive rsifie d,

hig he r va lue po rtfo lio

• T

a rg e t ma rke ts whe re o ur diffe re ntia te d c a pa b ilitie s in c o mple x e ng ine e ring -le d pro g ra ms c re a te a win-win re la tio nship

• Ne w o pe ra tio na l mo de l a nd e mpha sis o n

b usine ss e xc e lle nc e to drive hig he r ma rg ins a nd c o nsiste nt e a rning s –

• Co nsiste nt a nd disc ipline d in o ur c a pita l

a llo c a tio n pla ns

• L

e a d o ur industry a nd de live r a to p q ua rtile fina nc ia l pe rfo rma nc e

Mar ke ts T e c hnology Ope r ations Syste ms

T a rg e te d gr

• wth

a nd o ptima l mix in o ur e nd ma rke ts Sha rpe ning o ur

diffe r e ntiation

De live ring with disc ipline a nd c onsiste nc y Driving e ffic ie nc y a nd pro duc tivity with two fo c use d mo de ls

A Ne w Str ate gic F r ame wor k to De live r Supe r ior Re tur ns T

• mor

r

• w…

16 16

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Quar te r

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Ye ar

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Ye ar

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Ma rc h 31, 2020 De c e mb e r 31, 2019 Ma rc h 31, 2019 De c e mb e r 31, 2018 Ma rc h 31, 2020 Ma rc h 31, 2019 ($T ho usa nds, e xc e pt pe r sha re a mo unts)

GAAP inc o me (lo ss) b e fo re inc o me ta xe s $44,680 $145,389 ($36,392) ($31,913) $158,485 $182,126 I nta ng ib le a mo rtiza tio n 15,203 15,598 17,337 20,308 64,106 74,396 Sto c k-b a se d c o mpe nsa tio n e xpe nse 18,214 19,215 14,971 21,027 71,546 76,032 Custo me r re la te d a sse t impa irme nts 10,730 3,754 19,576 50,153 105,940 87,093 Re struc turing c ha rg e s 17,284 14,616 12,880 65,843 216,407 113,313 Ne w re ve nue sta nda rd a do ptio n impa c t

• 9,291

L e g a l a nd o the r (1,742) 6,864 10,281 4,994 26,270 35,644 Othe r c ha rg e s, ne t 74,545 14,395 118,929 71,879 91,550 110,414 I nte re st a nd o the r, ne t 28,077 36,207 46,565 54,087 163,727 183,454 No n-GAAP o pe ra ting inc o me $206,991 $256,038 $204,147 $256,378 $898,031 $871,763 No n-GAAP o pe ra ting ma rg in* 3.8% 4.0% 3.3% 3.7% 3.7% 3.3%

For more details on the GAAP to Non-GAAP adjustments for current and historical periods, please refer to the Investor Relations section of our website which includes press releases and summary financials of the respective periods.

Appe ndix: Re c onc iliation of GAAP to Non- GAAP Me asur e s

*We calculate our Non-GAAP operating margin as current quarter Non-GAAP operating income divided by current quarter revenue.

19 19 For more details on the GAAP to Non-GAAP adjustments for current and historical periods, please refer to the Investor Relations section of our website which includes press releases and summary financials of the respective periods.

Appe ndix: Re c onc iliation of GAAP to Non- GAAP Me asur e s

Quar te r

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Ye ar

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($T ho usa nds, e xc e pt fo r c o nve rsio n %) Ma rc h 31, 2020 De c e mb e r 31, 2019 Ma rc h 31, 2019 De c e mb e r 31, 2018 Ma rc h 31, 2020 Ma rc h 31, 2019

GAAP ne t inc o me (lo ss) $48,259 $111,388 ($64,352) ($45,169) $87,579 $93,399 I nta ng ib le a mo rtiza tio n 15,203 15,598 17,337 20,308 64,106 74,396 Sto c k-b a se d c o mpe nsa tio n e xpe nse 18,214 19,215 14,971 21,027 71,546 76,032 Re struc turing c ha rg e s 17,284 14,616 12,880 65,843 216,407 113,313 Custo me r re la te d a sse t impa irme nts 10,730 3,754 19,576 50,153 105,940 87,093 Ne w re ve nue sta nda rd a do ptio n impa c t

• 9,291

L e g a l a nd o the r (1,742) 7,047 10,281 4,994 26,453 35,644 Othe r c ha rg e s inte re st a nd o the r, ne t 66,217 16,592 120,293 72,903 93,411 109,980 Adjustme nts fo r ta xe s (31,004) 4,595 10,247 (9,461) (33,830) 3,978 No n-GAAP ne t inc o me $143,161 $192,805 $141,233 $180,598 $631,612 $603,126 Dilute d e a rning s (lo sse s) pe r sha re : GAAP* $0.10 $0.22 ($0.12) ($0.09) $0.17 $0.18 NON-GAAP $0.28 $0.38 $0.27 $0.34 $1.23 $1.14 Ba sic sha re s use d in c o mputing pe r sha re a mo unts 501,446 506,938 520,379 524,876 508,774 526,519 Dilute d sha re s use d in c o mputing pe r sha re a mo unts 505,593 510,339 522,460 526,801 512,437 530,070

*Basic shares were used in calculating diluted GAAP EPS for the quarter ended March 31, 2019 and December 31, 2018, due to the net loss recognized for the respective periods

20 20

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Ma rc h 31, 2020 Ma rc h 31, 2019 ($T ho usa nds) % o f re ve nue % o f re ve nue

GAAP g ro ss pro fit $365,627 6.7% $380,295 6.1% Sto c k-b a se d c o mpe nsa tio n e xpe nse 3,747 4,614 Custo me r re la te d a sse t impa irme nts 8,665 4,841 Re struc turing c ha rg e s 15,429 9,493 L e g a l a nd o the r (1,859) 8,714 No n-GAAP g ro ss pro fit $391,609 7.1% $407,957 6.6% GAAP SG&A e xpe nse s $201,267 3.7% $230,469 3.7% Sto c k-b a se d c o mpe nsa tio n e xpe nse (14,467) (10,357) Custo me r re la te d a sse t impa irme nt, le g a l a nd o the r (2,182) (16,301) No n-GAAP SG&A e xpe nse s $184,618 3.4% $203,811 3.3%

For more details on the GAAP to Non-GAAP adjustments for current and historical periods, please refer to the Investor Relations section of our website which includes press releases and summary financials of the respective periods.

Appe ndix: Re c onc iliation of GAAP to Non- GAAP Me asur e s

21 21 For more details on the GAAP to Non-GAAP adjustments for current and historical periods, please refer to the Investor Relations section of our website which includes press releases and summary financials of the respective periods.

Appe ndix: Re c onc iliation of GAAP to Non- GAAP Me asur e s

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Ma rc h 31, 2020 ($T ho usa nds)

Se g me nt inc o me : Co mmunic a tio n & E nte rprise Co mpute $31,480 Co nsume r T e c hno lo g ie s Gro up 5,756 I ndustria l & E me rg ing I ndustrie s 134,476 Hig h Re lia b ility So lutio ns 63,264 Co rpo ra te a nd Othe r* (27,985) T

• ta l se g me nt inc o me :

$206,991 Ope ra ting ma rg in: Co mmunic a tio n & E nte rprise Co mpute 2.1% Co nsume r T e c hno lo g ie s Gro up 0.6% I ndustria l & E me rg ing I ndustrie s 7.2% Hig h Re lia b ility So lutio ns 5.6%

Quar te r

• E

nde d

Ma rc h 31, 2020 ($T ho usa nds)

Re c onc ilia tion of se g me nt inc ome to inc ome be fore inc ome ta xe s

T

• ta l se g me nt inc o me

$206,991 I nta ng ib le a mo rtiza tio n 15,203 Sto c k-b a se d c o mpe nsa tio n e xpe nse 18,214 Custo me r re la te d a sse t impa irme nts 10,730 Re struc turing c ha rg e s 17,284 L e g a l a nd o the r (1,742) Othe r c ha rg e s, ne t 74,545 I nte re st a nd o the r, ne t 28,077 I nc o me b e fo re inc o me ta xe s $44,680

*Corporate and Other: corporate service costs that are not included in the assessment of the performance of each of the identified reporting segments.

22 22 For more details on the GAAP to Non-GAAP adjustments for current and historical periods, please refer to the Investor Relations section of our website which includes press releases and summary financials of the respective periods.

Appe ndix: Re c onc iliation of GAAP to Non- GAAP Me asur e s

Quar te r

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Ma rc h 31, 2020 ($T ho usa nds)

Se g me nt inc o me : F le x Re lia b ility So lutio ns** $167,120 F le x Ag ility So lutio ns** 67,856 Co rpo ra te a nd Othe r* (27,985) T

• ta l se g me nt inc o me :

$206,991 Ope ra ting ma rg in: F le x Re lia b ility So lutio ns** 6.5% F le x Ag ility So lutio ns** 2.3%

Quar te r

• e nde d

Ma rc h 31, 2020 ($T ho usa nds)

Re c onc ilia tion of se g me nt inc ome to inc ome be fore inc ome ta xe s

T

• ta l se g me nt inc o me

$206,991 I nta ng ib le a mo rtiza tio n 15,203 Sto c k-b a se d c o mpe nsa tio n e xpe nse 18,214 Custo me r re la te d a sse t impa irme nts 10,730 Re struc turing c ha rg e s 17,284 L e g a l a nd o the r (1,742) Othe r c ha rg e s, ne t 74,545 I nte re st a nd o the r, ne t 28,077 I nc o me b e fo re inc o me ta xe s $44,680

*Corporate and Other: corporate service costs that are not included in the assessment of the performance of each of the identified reporting segments.

**Co mpany e xpe c ts to ado pt ne w se g me nt re po rting fo r Q1 F Y21 and is pro viding the se fig ure s fo r illustrative purpo se s.

23 23 For more details on the GAAP to Non-GAAP adjustments for current and historical periods, please refer to the Investor Relations section of our website which includes press releases and summary financials of the respective periods.

Appe ndix: Re c onc iliation of GAAP to Non- GAAP Me asur e s

Ye ar

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Ye ar

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($T ho usa nds, e xc e pt fo r c o nve rsio n %) Ma rc h 31, 2020 Ma rc h 31, 2019

Ne t c a sh use d in o pe ra ting a c tivitie s ($1,533,276) ($2,971,024) Ca sh c o lle c tio ns o f ABS po sitio ns a nd o the r 2,561,619 3,605,299 Ne t c a pita l e xpe nditure s (355.995) (631,387) Adjuste d fre e c a sh flo w $672,348 2,888 GAAP ne t inc o me (lo ss) $87,579 $93,399 I nta ng ib le a mo rtiza tio n 64,106 74,396 Sto c k-b a se d c o mpe nsa tio n e xpe nse 71,546 76,032 Re struc turing c ha rg e s 216,407 113,313 Custo me r re la te d a sse t impa irme nts 105,940 87,093 Ne w re ve nue sta nda rd a do ptio n impa c t

• 9,291

L e g a l a nd o the r 26,453 35,644 Othe r c ha rg e s inte re st a nd o the r, ne t 93,411 109,980 Adjustme nts fo r ta xe s (33,830) 3,978 No n-GAAP ne t inc o me $631,612 $603,126 GAAP c a sh flo w c o nve rsio n

• 1751%
• 3181%

No n-GAAP a djuste d fre e c a sh flo w c o nve rsio n 106% 0%

Adjusted free cash flow conversion is calculated by dividing the Company's current quarter adjusted free cash flow by Non-GAAP net income. We believe adjusted free cash flow conversion is a useful measure in providing investors with information regarding the Company’s ability to convert profits into cash and is a widely accepted measure. Adjusted free cash flow is calculated as operating cash flow for the quarter less net capital expenditures adding back cash collections of deferred purchase price. In addition, Q3 & Q4FY20 adjusted FCF includes collection of the deferred purchase price receivables which the Company repurchased as part of the ABS program amended in the third quarter of fiscal year 2020 (refer to our summary financials published on company website for additional details). Adjusted free cash flow also excludes impacts related to certain vendor programs that is required for GAAP. Non- GAAP net income excludes certain amounts that are included in the most directly comparable measures under GAAP including stock-based compensation expense, intangible amortization, restructuring charges, customer related asset impairments, tax adjustments and certain other charges. Adjusted free cash flow conversion is a non-GAAP financial measure and may not be defined and calculated by other companies in the same manner.

24 24 For more details on the GAAP to Non-GAAP adjustments for current and historical periods, please refer to the Investor Relations section of our website which includes press releases and summary financials of the respective periods.

Appe ndix: Re c onc iliation of GAAP to Non- GAAP Me asur e s

Quar te r

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($T ho usa nds, e xc e pt fo r c o nve rsio n %) Ma rc h 31, 2020 De c e mb e r 31, 2019 Se pte mb e r 27, 2019 June 28, 2019 Ma rc h 31, 2019 De c e mb e r 31, 2018

Ne t c a sh pro vide d b y (use d in) o pe ra ting a c tivitie s $166,030 ($50,894) ($991,546) ($656,866) ($642,419) ($621,009) Ca sh c o lle c tio ns o f ABS po sitio ns a nd o the r 50,525 343,928 1,273,431 893,735 897,737 894,617 Ne t c a pita l e xpe nditure s (82,545) (55,239) (94,997) (123,214) (126,019) (154,968) Adjuste d fre e c a sh flo w $134,010 $237,795 $186,888 $113,655 $129,299 $118,640

Adjusted free cash flow is calculated as operating cash flow for the quarter less net capital expenditures adding back cash collections of deferred purchase price and certain receivables sold to certain financial institutions under a customer's supplier financing program in the second quarter of fiscal 2020 that subsequently qualified for operating cash flow treatment per GAAP in the third quarter of fiscal year 2020. In addition, Q3 & Q4FY20 adjusted FCF includes collection of the deferred purchase price receivables which the Company repurchased as part of the ABS program amended in the third quarter of fiscal year 2020 (refer to our summary financials published on company website for additional details). Adjusted free cash flow also excludes impacts related to certain vendor programs that is required for GAAP. Adjusted free cash flow is a non-GAAP financial measure and may not be defined and calculated by other companies in the same manner.

25 25

Appe ndix: Re c onc iliation of GAAP to Non- GAAP Me asur e s

Quar te r

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Ma rc h 31, 2020 ($T ho usa nds, e xc e pt de b t to E BI T DA ra tio )

GAAP Adjustme nts Non- GAAP

Pre ta x inc o me $44,680 $125,906 $170,586 De pre c ia tio n 96,256

• 96,256

Amo rtiza tio n 15,203 (15,203)

• I

nte re st, ne t 27,826 7,779 35,605 E BI T DA* 183,965 118,482 302,447 E BI T DA – Ro lling 4 Qua rte rs 764,375

• 1,323,136

T

• ta l De b t

$2,838,240

• $2,838,240

De b t to E BI T DA* 3.7x (1.6x) 2.1x

**Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) and Debt/EBITDA are non- GAAP financial measures. EBITDA is derived by adjusting for net interest and adding back depreciation to non-GAAP pretax income. Quarterly Debt to EBITDA is calculated by dividing the Company's total debt as of the date presented by LTM EBITDA. Non-GAAP pretax income excludes certain amounts that are included in the most directly comparable measures under GAAP including stock-based compensation expense, intangible amortization, restructuring charges, customer related asset impairments, legal and other, and certain other charges or income.

26

T hank you.