10-KPeriod: FY2002

FLEX LTD. Annual Report, Year Ended Mar 31, 2002

Filed May 3, 2002For Securities:FLEX

Summary

Flextronics International Ltd. (FLEX) reported its fiscal year 2002 results, ending March 31, 2002, with a notable increase in net sales to $13.1 billion, an 8% rise from fiscal year 2001. This growth was primarily driven by acquisitions and increased sales to existing customers, despite an economic downturn impacting the electronics industry, particularly in the telecommunications and networking sectors. The company experienced a net loss of $153.7 million for fiscal year 2002, a significant improvement from the $446.0 million net loss in fiscal year 2001. This improved loss was largely influenced by substantial restructuring charges and facility closures incurred in both fiscal years, with fiscal year 2002 seeing charges of $574.4 million compared to $973.3 million in fiscal year 2001. The company continues to execute a strategy focused on providing end-to-end manufacturing solutions, leveraging its global presence and expanding its industrial park strategy to serve leading OEMs in high-growth technology sectors.

Key Highlights

  • 1Net sales reached $13.1 billion in fiscal year 2002, an 8% increase year-over-year, driven by acquisitions and expanded customer relationships.
  • 2The company reported a net loss of $153.7 million for fiscal year 2002, an improvement from the $446.0 million net loss in fiscal year 2001.
  • 3Significant restructuring and facility closure charges were incurred in both fiscal years, totaling $574.4 million in FY2002 and $973.3 million in FY2001, impacting profitability.
  • 4Flextronics operates a global network of manufacturing facilities across four continents, serving major OEMs in industries like handheld electronics, communications infrastructure, and IT infrastructure.
  • 5The company's strategy emphasizes end-to-end solutions, including design, engineering, manufacturing, and logistics, to accelerate time-to-market and reduce costs for its clients.
  • 6Customer concentration remains high, with the top ten customers accounting for approximately 64% of net sales in fiscal year 2002, highlighting dependency on key relationships.
  • 7The company is actively expanding its global footprint through acquisitions and strategic transactions, having completed over 30 acquisitions since the beginning of fiscal year 2001.

Frequently Asked Questions

In fiscal year 2002, Flextronics reported net sales of $13.1 billion, an 8% increase from the prior year. However, the company incurred a net loss of $153.7 million, which was an improvement from the significant net loss of $446.0 million in fiscal year 2001. This loss was influenced by substantial restructuring charges and facility closures.

Flextronics focuses on providing comprehensive end-to-end manufacturing services to OEMs across various technology sectors. While the company aims to build long-term relationships, it faces significant customer concentration, with its top ten customers representing 64% of net sales in fiscal year 2002. The company continues to pursue strategic acquisitions and customer transactions to expand its offerings and global reach.

The unusual charges were primarily related to restructuring activities, including the consolidation and closure of manufacturing facilities, which amounted to $574.4 million in fiscal year 2002 and $973.3 million in fiscal year 2001. These charges also included merger-related expenses and impairment of investments in certain technology companies.

Flextronics' strategy involves enhancing customer product development and manufacturing through global presence and comprehensive solutions. Key elements include expanding its industrial park strategy, streamlining business processes with information technology, and pursuing strategic opportunities, including acquisitions. The company aims to be an integral part of its customers' operations by offering end-to-end services.