News
NORTHBROOK, IL, Aug. 27 -- Orders for rigid boards upticked in July and demand for flex circuits continues to be strong, according to the latest 90-day moving average of North American manufacturers.
For all board types, shipments rose 31.1% and bookings were up 42.2% vs. a year ago, said IPC, which administers the monthly poll. The figures may include some sales of products built offshore and brokered by the surveyed companies.
The July book-to-bill was 0.99 for rigid, up 0.04 points sequentially. The B2B for flex circuits remained even at 1.57.
The book-to-bill for all board types rose to 1.10, up 0.04 points sequentially.
The ratio is calculated by averaging the number of orders booked over the past three months and dividing by the average sales billed during the same period. A ratio of 1.06 means that for every $100 in shipments, $110 worth of PCBs were booked. An increasing ratio is generally considered a sign of a market poised to rise.
Shipments are up 34.8% year-to-date, bookings 43%. Combined July shipments fell 18.1% sequentially, while bookings inched up 1.9%.
July rigid shipments were up 17.6% and bookings 20.5% over last year. Year-to-date, rigid shipments are up 25.5% and bookings are up 23.1%. Among those surveyed, rigid shipments fell 21.2% sequentially and bookings dropped 7.5%.
July flex shipments were up 76.1% while bookings reversed last month's decline, rising 71.1% vs. last year. Year-to-date, flex shipments are up 77.8% and bookings 133.2%. Sequentially, flex shipments fell 3.7% and bookings were up 56.1%.
Flex sales, which include some value-added services, make up about 17% of total PCB sales in the IPC poll.
The data come from a sample of North American rigid and flexible PCB manufacturers.
The EMS provider assembles thin-film diode LCD modules for Seiko.
In a statement, Isomu Koike, president of Seiko Epson's Philippine plant, said, "This is the first time we have embarked on a close cooperation with another company and I believe that this partnership with IMI will be lasting and fruitful."
Based on server revenues, IBM remained the top vendor, with sales up 10.8% to $3.5 billion, good for a market share of 30.7%. Dell's revenue rose 20.1% to $1.1 billion, making it fastest growing OEM among top-tier vendors.
H-P led the way in shipments, with 463,489 units. Sun Microsystems showed the highest growth rate, with shipments up 38.4%, to 90,487 units.
Following a scheduled mid-quarter conference call, Flextronics CFO Bob Dykes said, "Growth continues very strongly and our business is looking very solid."
Flextronics reiterated July guidance for Q2 earnings of 15 to 18 cents per share before items.
In recent weeks several analysts had expresssed concern over rising inventories, particularly among makers of telecom and communications gear. On the call, chief executive Michael Marks pooh-poohed the negative sentiment, saying "concerns about inventories were way overblown in our industry."
Later, to a news service, Dykes said, "The September and December quarters are strong ones for us and therefore inventories will rise along with that."
For the quarter ended June 27, total net earnings grew 135%, also to $2.5 million.
The results include net sales of $11.9 million from the company's Pittsburgh operation, acquired in February.
For the year, net sales rose 28% to $131.5 million. Net earnings from continuing operations rose 110% to $7 million. Total net earnings grew 205% to $6.9 million. The net loss from discontinued operations was $102,000.
Gross margins improved to 23.1%, up from 20.3% in 2003, the result of product mix, operating productivity gains and higher sales volume.
Selling and administrative expenses declined one point, to 14% of sales.
The company has debt of $37.7 million, up from $7.1 million last year, and cash and cash equivalents of $793,000, versus $4 million in 2003.
LaBarge guided for fiscal 2005 first-quarter net sales to increase at least 36%, to $41 million to $42 million and fiscal 2005 sales and earnings to increase 25%.
Prunier, 43, was senior director for the company's medical products business. He also held management posts at Plexus, SCI Systems and other smaller manufacturers.
He replaces acting chief financial officer Mark Lustig, the company controller who had been serving as interim CFO since Rick Ackel quit the position in January.
White, who has 20 years of experience in technology manufacturing, was senior vice president and CFO of Asyst Technologies, a provider of integrated automation tools for semiconductor and flat-panel display manufacturing. Previously, he was president and chief executive of Candescent Technologies, a developer of field emission display technology.
He also held positions at Zehntel Inc., Burroughs Corp. (now Unisys Corp.) and Digital Equipment Corp.
White has a bachelor's in physics from Brigham Young University and an MBA in finance and operations analysis from the University of Washington.
Under the freshly minted agreements, Niche Tech (2004) will provide services in Thailand, Sigmatek Corp. in Taiwan, SIP Technology Sdn Bhd in central and northern Malaysia, and SIP Technology Pte. Ltd. in southern Malaysia, Singapore and Indonesia.
In a press statement, Speedline president and CEO Pierre de Villemejane touted the firms' experience. "The management and staffs ... represent years of experience in the capital equipment and PCB assembly industries. All are industry veterans who clearly understand the challenges faced by - and are well equipped to deliver the required solutions to - the region's manufacturers."
(Ed.: Click on the respective company names for links to their Web sites.)
The reseach firm predicts revenues will grow 27% this year, to $226 billion. Gartner previously forecast growth of "more than 25%."
The report followed on the heels of an improved outlook for semiconductor tools from the trade group SEMI. It is not clear, however, whether Gartner's report takes into account a recent announcement that Intel Corp. will slash pricing by up to 35%.
In a statement, Gartner said concerns that rising inventories in the supply chain were overstated. "Had the increased inventory been accompanied by a flat or even falling semiconductor market, it would have been of grave concern. In a rising market, increasing inventory levels are normal.
Gartner's research vice president Richard Gordon acknowledged the industry still harbors jitters from the last downturn. "Despite the improving market conditions that semiconductor vendors have enjoyed over the past several quarters and the expectation that revenue growth this year will be close to 30%, this industry upcycle is notable in that few in the industry have felt able to acknowledge it as a boom."
NEW YORK, Aug. 24 - A majority of U.S. business and IT executives anticipate increases in IT expenditures over the next three years, according to results of a survey released today by Accenture.
The study, which queried more than 300 general business managers and IT executives of large U.S.-based companies, found that 55% of respondents expect their organizations to increase their IT expenditures over the next three years, with only 10% expecting decreased spending.
In addition, of the 84% of respondents who indicated that productivity at their companies had increased over the past several years, most identified IT-related factors as key to that increase. Specifically, 83% cited "better use of technology" and 65% selected "the right amount of investment in technology."
However, the survey identified several areas where the business managers were disappointed in the effectiveness and impact of IT. Most notably, 47% of business managers and 51% of IT executives said their companies did not know how to make their technology organizations accountable for delivering real business value. In addition, 52% of the business managers said that IT is underdelivering relative to what their companies spend.
The results are based on an online survey conducted in June and July. A total of 302 executives were surveyed at U.S. companies with more than 5,000 employees and median annual revenue of $10 billion.
North American-based semi tool makers posted $1.61 billion in orders in July, using a three-month average basis, the trade group SEMI said today. Bookings were even with revised June numbers and 128% ahead of a year ago.
A book-to-bill of 1.05 means that $105 worth of orders were received for every $100 of product billed for the month.
The July 90-day average of worldwide billings was $1.54 billion, up 2% over revised June levels and 96% ahead of last year.
"Bookings have increased sequentially for eleven months and are at the highest point since early 2001," said Stanley T. Myers, president and CEO of SEMI. "The bookings and billings values for North American-based equipment companies have stabilized at high levels and support our global billings outlook for the second highest revenue year on record for our industry."
The EMS maker is offering what it calls its Green Services to OEMs seeking to comply with pending environmental initiatives, including the Restriction of Hazardous Substances legislation, which will require the removal of a number of hazardous substances, including lead, from electronics components by July 1, 2006.
Depending on they type products they design, OEMs will go through the transition in stages, Celestica general manager of engineering services Dan Henes observes. "There's a suite of [stages] that each customer will have to go through. Some will go through [these stages] themselves, some will need help."
In a phone interview with Circuits Assembly, Henes said that Celestica can offer either "point" services - specific solutions to specific problems, for example, help with certain design problems - or an end-to-end solution. "By breaking this into bite-sized pieces, customers can move at their own pace. They need to conduct an assessment of their designs and materials are in terms of compliance. We can do that BOM/risk analysis for them."
Among the services offered are consulting services, turnkey product conversion and technology qualification.
Henes noted that companies like Celestica, which directly handles designs from OEMs and buys materials from vendors, are best-positioned to help the supply chain navigate through the dizzying maze of lead-free alternatives and paperwork. "There's the synchronization of design, manufacturing processes and the component supply base. Some customers are struggling with, who's doing what in the supply base? We're probably in the best position to navigate that."
As evidence, Henes points to obscured effects of the lead-free conversion, which he believes EMS firms are attuned to. "You may have a product today that has 100 parts. Half meet lead-free legislation, and require no banned substitutes. The design and supplier [of those parts] say, 'We don't have to do anything for those.' But you need [lead-free] solder, which requires higher processing temperatures, and now you have to go back and qualify these new redesigned parts and put them side-by-side with the components that the OEM thought were OK. It's not because of lead conversion, but the temperature extremes that are a side effect of the conversion
The transition, Henes says, is like a "massive industry engineering change." He asserts that for a Tier 1 EMS provider like Celestica, "this is what we do for a living."
According to Celestica, the company has been working on environmental compliance issues since 1999. Consortia work to date has included building lead-free boards to support the High Density Packaging Users Group's lead-free programs; sponsoring and directing the Centre for Microelectronics Assembly and Packaging's lead-free development activities for Canadian universities, and leading a NEMI program on the assembly and reworkability of lead-free solder joints.
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