SCOTTS VALLEY, CA -- Seagate today gave firmer guidance for its hard drive shipments over the next two quarters, saying the total units delivered would be at the low end of previous guidance.

KORAT, THAILAND — Benchmark Electronics has begun operations at its previously vacant manufacturing facility here, in response to the massive flooding that has sidelined much of the country's EMS plants.

MINNEAPOLIS -- Nortech Systems today reported net income rose 44% on a 9% increase in sales for the quarter ended Sept. 30.

NORTH BILLERICA, MA — BTU International reported a third-quarter net loss of $2 million, due in part to restructuring charges of $352,000.

SAN JOSE – Electronics manufacturing services provider Sanmina-SCI Corp. reported fourth-quarter net income slid on heavy restructuring charges related to its acquisition of Breconridge last year.

Fourth-quarter profits were $18.1 million, down 42.4% year-over-year, and up 92.5% sequentially. Revenue was $1.7 billion, up 1.3% sequentially and nearly flat year-over-year. GAAP operating income was $53.5 million or 3.2% of revenue, up 1.13% sequentially, and down 8.1% year-over-year. Inventory turns fell to 7 from 7.2.

The company took $14 million in one-time charges, due partially to the move of all high-volume optical production from Canada to a factory in Guadalajara, Mexico. The pricing environment has been stable, CFO Bob Eulau said.  Cash flow from operations for the quarter was $79 million and capital expenditures were $24 million. The company's largest customer is Nokia Siemens.

Revenue for fiscal 2011 was $6.6 billion, up 4.5% compared to the prior year. GAAP operating income was $212 million, up 3.5% year-over-year. GAAP net income was $68.9 million, down 43.7% compared to fiscal 2010.

“Despite headwinds in the market, we had a solid fourth quarter,” said Jure Sola, chairman and CEO.  ”Our first quarter fiscal 2012 guidance represents uncertainty in the market, push-outs from customers and potential supply constraints related to the Thailand floods. Fiscal 2012 is difficult to forecast at this time, but I am cautiously optimistic we will deliver improvements.”

On a Nov. 1 conference call with analysts, Sola said the company's overall capacity utilization was 85% to 90% in terms of personnel and 75% in terms of equipment. Sanmina expects first fiscal quarter 2012 revenue between $1.5 billion to $1.6 billion.

For the quarter, computing was up 2.8%, bringing the spike to 14% for the year. Sola also indicated that the defense segment, which was down in 2011, is not expected to recover quickly in 2012. Growth is expected in other businesses, including multimedia.

The company's facility in Thailand, which makes up 3% to 4% of overall sales, has not been affected by the local floods and is still operating.

Sanmina is a top 40 PCB fabricator: http://pcdandf.com/cms/component/content/article/237-2011-issues/8280-nti-100.

TEMPE, AZ – Economic activity in the manufacturing sector expanded in October for the 27th consecutive month, according to the Institute for Supply Management.
 
The PMI was down 0.8 percentage point to 50.8%, while new orders were up 2.8 percentage points to 52.4%. Production dropped 1.1 points to 50.1%, and inventories fell 5.3 percentage points to 46.7%. Customer inventories were 43.5%, down 5.5 percentage points. Backlogs were up 6 points to 47.5%.
 
“The PMI registered 50.8%, a decrease of 0.8 percentage point from September's reading of 51.6%, indicating expansion in the manufacturing sector for the 27th consecutive month. The New Orders Index increased 2.8 percentage points from September to 52.4%, indicating a return to growth after three months of contraction. The Prices Index, at 41%, dropped 15 percentage points, and is below the 50% mark for the first time since May 2009 when it registered 43.5%. Inventories decreased to 46.7%, which is 5.3 percentage points below the September reading of 52%. Comments from respondents are mixed, indicating positive relief from raw materials pricing and continuing strength in a few industries, but there is also more concern and caution about growth in this uncertain economy,” said ISM chair Bradley J. Holcomb.
 
The overall economy grew for the 29th consecutive month.

EL SEGUNDO –  The catastrophic flooding in Thailand will spur the hard disk drive market’s worst downturn in three years, says IHS iSuppli.

HDD shipments in the fourth quarter will decline to 125 million units, down 27.7% sequentially, the research firm says. The drop is the largest sequential decrease on a percentage basis since the fourth quarter of 2008.

The firm estimates that 30% of HDD production in the fourth quarter this year will be lost because of the disaster. This will result in a significant shortage of HDDs. HDD inventories will cause average HDD pricing to rise by 10% sequentially in the fourth quarter.

Production disruptions and stoppages are ongoing at the manufacturing operations of some of the world’s largest HDD makers – namely Western Digital and Toshiba – as well at suppliers of key components. Thailand is the world’s second-largest producer of HDDs after China and is a major supplier of hard drive parts, says IHS.

Given the direct impact of the disaster on its operations, Western Digital is likely to lose its status as the world’s largest shipper of HDDs, with its rank expected to fall two positions to third in the fourth quarter, down from first place in the third quarter. Toshiba’s rank could fall to fourth place, down from fifth.

In the PC market, the HDD shortage is likely to have the greatest impact on notebook PCs. The specific HDD plants affected by the flooding make devices designed for mobile computers. However, the PC industry appears to have sufficient stockpiles to last through the fourth quarter, so a disruption to notebook shipments in 2011 is not expected. Just the same, with HDD production disruptions expected to last at least six months, the shortage could impact notebook PC production in the first quarter of 2012.

Starting in the second quarter next year, IHS expects the notebook supply chain to begin to adjust to the impact of the disaster, obtaining hard drives from alternative sources in different regions and using other types of storage solutions, including solid state drives. This will allow the notebook supply chain to mitigate the impact of the HDD shortage.

The DRAM market could be negatively impacted by slowing sales of notebook PCs. Any reduction in PC sales due to supply chain constraints will further depress the already over-supplied DRAM market, says the firm.

In the automotive sector, eight OEMs that build cars in central Thailand have halted all output: Ford, Mazda, Hino, Honda, Isuzu, Mitsubishi, Nissan and Toyota. These OEMs announced they have suspended production until the end of October, although IHS expects the action to extend into mid-November. IHS downgraded Thailand’s light-vehicle forecast to 1.64 million units in the fourth quarter, down from 1.77 million units. A further reduction of 50,000 to 75,000 units is possible. Already, floods have affected vehicles to be exported to core markets in the ASEAN region, Australia, Japan and the Middle East. Thailand’s exports account for 56% of total production.

The loss of critical automotive electronic component and parts supply from Thailand also has impacted Japan’s car output. In particular, prolonged part-inventory issues from Thailand may cause Japanese suppliers and OEMs to force further production adjustments. A key challenge could come sometime in the fourth quarter and the first quarter of 2012, as the Japanese continue trying to compensate for lost output from the country’s earthquake disaster earlier in March. The component shortages out of Thailand also are expected to impact car manufacturing facilities in North America, Europe and China, says IHS.

Thailand’s camera manufacturing operations of Sony, Nikon and Canon all have been disrupted or suspended by the flooding. As a result, IHS anticipates that overall camera shipments will drop in the fourth quarter and possibly in the first quarter of 2012.

Last, the manufacturing operations of two major analog and discrete semiconductor suppliers – On Semiconductor and Microsemi – have faced a significant impact from the disaster in Thailand. Fellow suppliers Rohm and Toshiba also have been affected, but to a lesser degree. For now, IHS believes the manufacturing disruptions at On Semiconductor and Microsemi will have minimal impact on the entire semiconductor industry, and mostly on the Japanese market.

JASPER, ID -- Kimball International's contract electronics assembly group extended its September quarter net loss to $1.1 million, down 345% from last year, on lower demand for medical and industrial products.

HONG KONG -- Surface Mount Technology  (Holdings) Ltd. has entered a conditional agreement with a London-based private investment company that will inject HK$30 million ($3.9 million) into the besieged EMS company.

OSAKA, JAPAN -- SIIX Corp. and Ayrshire Electronics have entered a business alliance whereby the two contract assemblers will share technical and physical resources to their respective worldwide customer base.

TAIPEI – Hon Hai (Foxconn) reported third-quarter net income of $641 million, down 8.6% year-over-year, on lower demand for PCs and consumer goods. It was the fourth consecutive quarter that profits fell.

Unconsolidated sales were roughly flat at $22.2 billion.

Nine-month net income fell 16% to $1.56 billion on unconsolidated sales of $61.8 billion.

The company’s slow economic recovery is attributed to slowing demand for computers and game machines, say published reports. Global computer shipments went up 3.2% in the third quarter from a year earlier, missing the 5.1% growth estimate, according to Gartner.

This quarter’s profits could rise, however, because of Apple’s iPhone 4S and dropping costs to move factories.

Hon Hai is in the process of moving factories to inland China and expanding in Brazil.

TAICHUNG, TAIWAN -- Foxconn plans to invest millions of dollars in a new facility here to build robots for use in medical applications and other factory automation equipment.