Electronics supplier Jabil Circuit Inc. (NYSE: JBL – $22.42) reported profit fell by more than half in the final quarter of its fiscal year, though revenue slid less than anticipated. St. Petersburg, Florida-based Jabil sells electronics design and production services to technology companies world-wide, with Apple Inc. contributing a chunk of revenue. The company also said it planned to realign its capacity and administrative-support infrastructure to “optimize organizational effectiveness in a more moderate growth environment.” It expects to take about $195 million in related charges over a two-year period. During the latest quarter ended Aug. 31, Jabil earned $38.1 million, down from $87.7 million. Excluding special items, the company earned $0.28 a share, down from $0.53 a year earlier; three cents above analysts’ views. Revenue slipped 5.3% to $4.43 billion, but a bit above the $4.27 billion consensus. Looking ahead, Jabil said it expects overall earnings for the current quarter of $0.54 to $0.74 a share on $4.8 billion to $5 billion in revenue, while analysts are projecting $0.61 a share on $4.88 billion in revenue.
Patient and venturesome accounts should note that there is the possibility of wide price appreciation potential 3 to 5 years hence. However, investors should also be aware, earnings can be somewhat erratic from year-to-year and will require tolerance as we wait this one out.