ANAHEIM, CA – Multi-Fineline Electronix reported fiscal first-quarter net sales of $229.5 million, up 6% from last year, on demand for smartphones and other consumer electronics. 

It was a record quarterly amount for the flex printed circuit board maker. The increase was tied to significantly higher sales to two major customers, and partially offset by substantially lower sales to one customer.

Net income for the period ended Dec. 31 was $16.3 million, 15.6% higher than the same period in fiscal 2009.  

Gross margin was 15.9%, compared to 15.3% last year and 14.1% in the prior quarter.

"In what is historically our strongest quarter of the year, we executed very well and delivered on record demand during the December quarter for our flex assemblies for smartphones and other consumer electronic devices, driving net sales to the highest quarterly level in the history of the Company," said Reza Meshgin, Chief Executive Officer of MFLEX.  "Our success in the first quarter was due in part to our ability to efficiently meet our OEM customers' high-volume production requirements for complex flex assemblies, which we believe helps give us a competitive advantage and expand our business.  

The year-over-year increase in gross margin is primarily due to improved yields and labor productivity partially offset by the higher material content of programs during the quarter.  Sequentially, gross margin increased from in the fourth quarter of fiscal 2009 due primarily to the leveraging of manufacturing costs over higher sales volumes and a favorable product mix.

M-Flex said its net sales in the current quarter would be closer to the bottom of the $160 million to $180 million range provided last month, and gross margin is projected to be 13%.

“Our second-quarter guidance reflects the normal seasonality after the holidays, the Chinese New Year in February, as well as some programs approaching the end of their life cycle. We believe our market share is unchanged with our major customers,” Meshgin said.

“We continue to expect year-over-year net sales growth in the second half of fiscal 2010 and we are very optimistic about our longer-term opportunities to profitably grow our business.”

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