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Jabil's reticence frustrates

By JAMES THORNER
Published December 21, 2006

Ever since word leaked last spring that Jabil Circuit Inc. was under investigation for how it granted stock options to executives, the St. Petersburg circuit board maker has blacked out earnings reports to let lawyers sift through the details.

Wall Street's frustration over that lack of information about company profitability spilled over during a Jabil conference call Wednesday.

As analysts peppered president and chief executive Tim Main with questions about Jabil's financial status, Main seemed to weary of the approach.

"We're not wrecking the business," he snapped toward the end of the conference call to announce results from the first quarter of fiscal 2007 that ended Nov. 30. "It's still an excellent business to be in."

Fragmentary results available showed Jabil's revenue rose 34 percent year to year, from $2.4-billion in late 2005 to $3.2-billion in late 2006.

How much of that was profit? Anybody's guess. But Jabil expressed optimism about the year ahead. Led by sales in consumer electronics, it expects revenue to rise 20 percent in 2007.

That outlook doesn't include the windfall from Jabil's planned $900-million purchase of Taiwan Green Point Enterprises Co.

Taiwan Green Point makes plastic casings for such products as Sony Ericsson cell phones, Apple's video iPod and BlackBerry pads. Jabil expects to take controlling interest in the company in January.

The big issue hanging over Jabil is a Securities and Exchange Commission inquiry into whether the company backdated stock options. The practice involves artificially dating a stock purchase to when the price was low so that the gain will be larger when the executive sells.

Jabil labeled the accusations unfounded and has spent $4-million on lawyers and accountants to defend itself, Main said Wednesday.

Fear that Jabil might have to restate earnings has blocked the release of earnings reports.

"I'm very, very sympathetic with your frustration," Main told Wall Street analysts. "I acknowledge that more information is better for shareholders."

Jabil, the Tampa Bay area's largest public company, employs 2,000 in St. Petersburg and more than 60,000 worldwide. Its share price closed down slightly to $26.56.

James Thorner can be reached at thorner@sptimes.com or 813226-3313.

[Last modified December 20, 2006, 23:09:26]