Fabrinet 10-Q: Restructuring Costs Detailed

TL;DR

Fabrinet's 10-Q details restructuring costs like severance and exit charges, impacting future financials.

AI Summary

Fabrinet filed its 10-Q for the period ending September 27, 2024. The filing details restructuring and other related costs, which can include severance, asset-related charges, and exit activity costs. These charges are recognized once communicated to employees, with severance recognized based on benefit arrangement type.

Why It Matters

Understanding restructuring costs is crucial for investors to assess the company's operational efficiency and future financial health.

Risk Assessment

Risk Level: medium — Restructuring costs can indicate underlying business challenges or strategic shifts that may impact future profitability.

Key Numbers

• 0001408710 — Central Index Key (Unique identifier for Fabrinet's SEC filings)

Key Players & Entities

• Fabrinet (company) — Filer of the 10-Q
• September 27, 2024 (date) — End of reporting period
• 2024-09-27 (date) — Conformed period of report
• 2024-11-05 (date) — Filing date

FAQ

Key Financial Figures

• $0.01 — e on which registered Ordinary Shares, $0.01 par value FN New York Stock Exchange

Filing Documents

• fn-20240927.htm (10-Q) — 1303KB
• fn-20240927x10qex311.htm (EX-31.1) — 10KB
• fn-20240927x10qex312.htm (EX-31.2) — 10KB
• fn-20240927x10qex321.htm (EX-32.1) — 8KB
• 0001408710-24-000040.txt ( ) — 7548KB
• fn-20240927.xsd (EX-101.SCH) — 49KB
• fn-20240927_cal.xml (EX-101.CAL) — 89KB
• fn-20240927_def.xml (EX-101.DEF) — 231KB
• fn-20240927_lab.xml (EX-101.LAB) — 651KB
• fn-20240927_pre.xml (EX-101.PRE) — 468KB
• fn-20240927_htm.xml (XML) — 1141KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 5

Financial Statements

Item 1. Financial Statements 5 Condensed Consolidated Balance Sheets as of September 2 7 , 2024 and June 28 , 202 4 (unaudited) 5 Condensed Consolidated Statements of Operations and Comprehensive Income for the three months ended September 2 7 , 2024 and September 29 , 2023 (unaudited) 6 Condensed Consolidated Statements of Shareholders' Equity for the three months ended September 2 7 , 2024 and September 29 , 2023 (unaudited ) 7 Condensed Consolidated Statements of Cash Flows for the three months ended September 2 7 , 2024 and September 29 , 2023 (unaudited) 8 Notes to Condensed Consolidated Financial Statements (unaudited) 9

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 25

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 35

Controls and Procedures

Item 4. Controls and Procedures 36

OTHER INFORMATION

PART II. OTHER INFORMATION 37

Legal Proceedings

Item 1. Legal Proceedings 37

Risk Factors

Item 1A. Risk Factors 37

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 53

Other Information

Item 5. Other Information 54

Exhibits

Item 6. Exhibits 54 Signature 55 2 Table of Contents RISK FACTORS SUMMARY You should carefully consider the information set forth below under the heading "Risk Factors" in Part II, Item 1A before deciding whether to invest in our securities. Below is a summary of the principal risks associated with an investment in our securities. Our sales depend on a small number of customers. A reduction in orders from any of these customers, the loss of any of these customers, or a customer exerting significant pricing and margin pressures on us could harm our business, financial condition and operating results. Consolidation in the markets we serve could harm our business, financial condition and operating results. If the optical communications market does not expand as we expect, our business may not grow as fast as we expect, which could adversely impact our business, financial condition and operating results. Our quarterly revenues, gross profit margins and operating results have fluctuated significantly and may continue to do so in the future, which may cause the market price of our ordinary shares to decline or be volatile. If we are unable to continue diversifying our precision optical and electro-mechanical manufacturing services across other markets within the optics industry, such as the semiconductor processing, biotechnology, metrology and material processing markets, or if these markets do not grow as fast as we expect, our business may not grow as fast as we expect, which could adversely impact our business, financial condition and operating results. We face significant competition in our business. If we are unable to compete successfully against our current and future competitors, our business, financial condition and operating results could be harmed. Cancellations, delays or reductions of customer orders and the relatively short-term nature of the commitments of our customers could harm our business, financial condition and operating res

: FINANCIAL INFORMATION

PART I: FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS FABRINET CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (in thousands of U.S. dollars, except share data and par value) September 27, 2024 June 28, 2024 Assets Current assets Cash and cash equivalents $ 400,684 $ 409,973 Short-term investments 508,193 448,630 Trade accounts receivable, net of allowance for expected credit losses of $ 1,954 and $ 1,629 , respectively 662,692 592,452 Inventories 440,405 463,206 Prepaid expenses 9,426 10,620 Other current assets 87,538 87,810 Total current assets 2,108,938 2,012,691 Non-current assets Property, plant and equipment, net 311,241 307,240 Intangibles, net 2,201 2,321 Operating right-of-use assets 5,133 5,336 Deferred tax assets 10,902 10,446 Other non-current assets 598 485 Total non-current assets 330,075 325,828 Total Assets $ 2,439,013 $ 2,338,519 Liabilities and Shareholders' Equity Current liabilities Trade accounts payable 427,892 441,835 Fixed assets payable 10,166 14,380 Operating lease liabilities, current portion 1,416 1,355 Income tax payable 4,377 3,937 Accrued payroll, bonus and related expenses 26,658 22,116 Accrued expenses 30,519 19,916 Other payables 74,950 54,403 Total current liabilities 575,978 557,942 Non-current liabilities Deferred tax liability 2,023 4,895 Operating lease liability, non-current portion 3,434 3,635 Severance liabilities 28,053 24,093 Other non-current liabilities 2,925 2,209 Total non-current liabilities 36,435 34,832 Total Liabilities 612,413 592,774 Commitments and contingencies (Note 14) Shareholders' equity Preferred shares ( 5,000,000 shares authorized, $ 0.01 par value; no shares issued and outstanding as of September 27, 2024 and June 28, 2024) — — Ordinary shares ( 500,000,000 shares authorized, $ 0.01 par value; 39,579,859 shares and 39,457,462 shares issued as of September 27, 2024 and June 28, 2024, respectively; and 36,267,639 shares and 36,145,242 shares outstanding as of September 27, 20

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View this 10-Q filing on SEC EDGAR