Sanmina (formerly Sanmina-SCI) is a top contract manufacturer of sophisticated electronic components, including printed circuit boards and board assemblies, backplanes and backplane assemblies, enclosures, cable assemblies, optical components and modules, and memory modules. In addition, the company provides services such as design and engineering, materials management, order fulfillment, and in-circuit testing. It serves OEMs in the health care, aerospace, telecommunications, and technology industries, among others. Sanmina has manufacturing facilities in 18 countries on four continents. Because its customers base production in lower-cost regions, more than 80% of sales come from outside the US.
Sales & Marketing
Telecommunications network equipment giant Nokia Siemens Networks accounts for more than 10% of the company's sales; Sanmina's top 10 customers together generate half of sales.
The company's largest geographic segment is China, which represents more than a quarter of sales. Mexico accounts for nearly 20% of sales, followed closely by the US. Sanmina is seeing the strongest growth (more than 20% year-over-year) in international markets, primarily in Asia, Eastern Europe, and Latin America.
Sanmina reported growth of just under 5% in fiscal 2011 (ended September 30), bringing revenues to $6.6 billion. This is the second year of growth for the company after it saw sales fall significantly between fiscal 2006 and fiscal 2009. Strong double-digit growth in sales of communications infrastructure products (the company's largest segment) helped offset declines in other areas.
The company was profitable in fiscal 2010 for the first time in nearly a decade. It continued on that path in fiscal 2011, although net income did fall nearly 45% to $69 million.
Operating in a highly cyclical industry, the company is continually restructuring in order to provide more cost-efficient products to its customers. In order to reduce costs and exert greater control over production, the company follows suit with its customers, locating its components plants in lower-cost regions, while its final system assembly plants sit near customers and their end-markets. It continues to eye regions such as Latin America, Eastern Europe, China, Southeast Asia, and India for opportunities to keep its manufacturing costs down.
Restructuring initiatives over the past several years include closing or consolidating facilities, moving manufacturing plants to lower-cost regions, and terminating employees (some 4,000 in 2009 and smaller numbers in subsequent years). – less