Nov. 4, 2009 (PR Newswire) --

ANAHEIM, Calif., Nov. 4 /PRNewswire-FirstCall/ -- Multi-Fineline Electronix, Inc. (Nasdaq: MFLX), a leading global provider of high-quality, technologically advanced flexible printed circuit and value-added component assembly solutions to the electronics industry, today reported financial results for the fourth quarter and fiscal year ended September 30, 2009. Net sales in the fourth quarter of fiscal 2009 were $199.2 million, a 6.5 percent decrease from net sales of $213.1 million in the same period of the prior year. The decrease in net sales was primarily due to substantially lower sales to two customers (consistent with recent prior quarters), partially offset by significantly higher sales to one other major customer with new product launches. Net sales in the fourth quarter of fiscal 2009 grew 14 percent sequentially from $174.5 million in the third quarter of fiscal 2009 due primarily to higher sales of flex assemblies for smartphones and other consumer electronic devices that are experiencing strong marketplace demand.

Net income for the fourth quarter of fiscal 2009 was $11.6 million, or $0.45 per diluted share, compared to net income of $7.6 million, or $0.30 per diluted share, for the same period in fiscal 2008. Net income in the fourth quarter of fiscal 2008 was negatively impacted by three non-recurring charges totaling $9.8 million net of tax, or $0.38 per diluted share.

"Our solid fourth quarter and record full-year results validate our value-added service model that includes working directly with our customers during the design phase of a program and maintaining a high level of interaction throughout the product lifecycle. This provides us with the ability to quickly ramp production of complex flex assemblies and has proven instrumental in expanding our relationship with major customers. Today's smartphones and the other consumer electronic devices for which we manufacture flex assemblies have increasingly short product lifecycles. We believe that our ability to help our customers reduce the time-to-market differentiates MFLEX and gives us a significant competitive advantage in the marketplace. We believe the traction that we have gained with the leading smartphone and consumer electronic device OEMs affirms our approach and we look forward to building upon this momentum in fiscal 2010 and beyond," said Reza Meshgin, Chief Executive Officer of MFLEX.

Financial Highlights

Gross margin during the fourth quarter of fiscal 2009 was 14.1 percent, compared to 16.1 percent for the same period in the prior year. The year-over-year decrease in gross margin is primarily due to the higher material content of current programs, partially offset by improved yields and labor productivity. Sequentially, gross margin declined from 14.3 percent in the third quarter of fiscal 2009 due to higher material costs associated with the fourth quarter product mix partially offset by improved labor utilization.

Cash flow from operating activities for the fourth quarter of fiscal 2009 was $27.0 million.

At September 30, 2009, the Company had cash and cash equivalents of $139.7 million, or $5.45 per diluted share. Cash and cash equivalents increased by $12.7 million compared to the balance at June 30, 2009.

For the fiscal year ended September 30, 2009, net sales increased 4.9 percent to a record $764.4 million from $728.8 million in fiscal 2008. The Company also generated record net income in fiscal 2009 of $46.1 million, or $1.81 per diluted share, compared to $40.5 million, or $1.59 per diluted share, during the prior fiscal year.

Outlook

For the first quarter of fiscal 2010, the Company expects net sales to range between $225 and $240 million, and gross margin to range between 14.0 percent and 16.0 percent based on the projected product mix and ramp of new programs.

Commenting on the Company's business outlook, Mr. Meshgin said, "For the first quarter of fiscal 2010, we expect to benefit from the normal seasonal increase in customer demand associated with the holiday season coupled with our success on new programs for smartphones and other consumer electronic devices. Based on our current forecast, we anticipate year-over-year net sales growth in the first quarter and we expect to achieve the highest quarterly net sales in the history of the Company. In addition, through improvements in yields and labor productivity, we continue to work diligently to mitigate the pressure on our gross margins from higher material costs associated with the current product mix.

"In anticipation of continued growth in fiscal 2010, we are moving forward with capital expenditures in support of our previously announced capacity expansion initiatives. Construction of our new manufacturing facility, MFC3, is progressing on schedule and we continue to expect that this new facility will be on-line during fiscal 2010 to help meet our future capacity requirements," said Mr. Meshgin.

Conference Call

MFLEX will host a conference call at 5:30 p.m. Eastern time (2:30 p.m. Pacific time) today to review its financial results for the fourth quarter of fiscal 2009. The dial-in number for the call in North America is 1-877-941-8632 and 1-480-629-9821 for international callers. The call also will be webcast live on the Internet and can be accessed by logging onto www.mflex.com.

The webcast will be archived on the Company's website for at least 60 days following the call. An audio replay of the conference call will be available for seven days beginning at 8:30 p.m. Eastern time (5:30 p.m.