What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2020-10-22 compared with 2019-10-22 · 13 added, 794 removed, 44 unchanged (95% of the section changed)

1 unchanged sentence

Market Information and Dividends

Our common stock trades on the New York Stock Exchange under the symbol JBL. See discussion of our cash dividends declared to

common shareholders in Note 11Stockholders Equity to the Consolidated Financial Statements.

We expect to continue

to declare and pay quarterly dividends of an amount similar to our past declarations.

However, the declaration and payment of future dividends are discretionary and will be subject to determination by our Board of Directors each quarter following

its review of our financial performance.

On October 14, 2019, the closing sales price for our common stock as reported on the New

York Stock Exchange was $35.64.

Our common stock trades on the New York Stock Exchange under the symbol “JBL.” See discussion of our cash dividends declared to common shareholders in Note 12 - “Stockholders’ Equity” to the Consolidated Financial Statements.

We expect to continue to declare and pay quarterly dividends of an amount similar to our past declarations.

However, the declaration and payment of future dividends are discretionary and will be subject to determination by our Board of Directors each quarter following its review of our financial performance and global economic conditions.

On October 14, 2020 , the closing sales price for our common stock as reported on the New York Stock Exchange was $35.63 .

As of October 14, 2020 , there were 1,266 holders of record of our common stock.

A substantially greater number of holders of our common stock are street name or beneficial holders, whose shares are

held of record by banks, brokers, and other financial institutions.

Information regarding equity compensation plans is incorporated by

reference to the information set forth in Item 12 of Part III of this report.

A substantially greater number of holders of our common stock are “street name” or beneficial holders, whose shares are held of record by banks, brokers, and other financial institutions.

Information regarding equity compensation plans is incorporated by reference to the information set forth in Item 12 of Part III of this report.

Stock Performance Graph

The performance graph and table show a comparison of cumulative total stockholder return, assuming the reinvestment of dividends, from a $100

investment in the common stock of Jabil over the five-year period ending August 31, 2019, with the cumulative stockholder return of the (1) S&P MidCap 400 Index and (2) peer group which includes Celestica Inc., Catcher Technology

Co., Ltd, Flex Ltd., Hon-Hai Precision Industry Co.

The performance graph and table show a comparison of cumulative total stockholder return, assuming the reinvestment of dividends, from a $100 investment in the common stock of Jabil over the five-year period ending August 31, 2020 , with the cumulative stockholder return of the (1) S&P MidCap 400 Index and (2) peer group which includes Celestica Inc., Catcher Technology Co., Ltd, Flex Ltd., Hon-Hai Precision Industry Co.

Ltd, Plexus Corp., and Sanmina Corp.

Comparison of 5 Year Cumulative Total Return

S&P MidCap 400 Index – Total Returns

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Announced Program (2)

Dollar Value of

Shares that May

Yet Be Purchased

Under the Program

Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program

(in thousands) (2)

2 unchanged sentences

August 1, 2020 - August 31, 2020

The purchases include amounts that are attributable to shares surrendered to us by employees to satisfy, in

connection with the vesting of restricted stock units and the exercise of stock options and stock appreciation rights, their tax withholding obligations.

In September 2019, our Board of Directors (the Board) authorized the repurchase of up to

$600.0 million of our common stock as publicly announced in a press release on September 24, 2019 (the 2020 Share Repurchase Program).

From September 24, 2019 through October 14, 2019, we repurchased 874,475 shares,

utilizing a total of $30.8 million of the $600.0 million authorized by our Board of Directors.

The purchases include amounts that are attributable to 1,319 shares surrendered to us by employees to satisfy, in connection with the vesting of restricted stock units and the exercise of stock options and stock appreciation rights, their tax withholding obligations.

In September 2019, our Board of Directors authorized the repurchase of up to $600.0 million of our common stock as publicly announced in a press release on September 24, 2019 (the “2020 Share Repurchase Program”).

Selected Financial Data

The following selected data is derived from our Consolidated Financial Statements.

This data should be read in conjunction with the

Consolidated Financial Statements and notes thereto incorporated into Item 8, Financial Statements and Supplementary Data and with Item 7, Managements Discussion and Analysis of Financial Condition and Results of

This data should be read in conjunction with the Consolidated Financial Statements and notes thereto incorporated into Item 8, “Financial Statements and Supplementary Data” and with Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Fiscal Year Ended August 31,

2 unchanged sentences

Operating income

Income from continuing operations before tax

Income from continuing operations, net of tax

Discontinued operations, net of

Income before income tax

Net income attributable to Jabil Inc.

Earnings per share attributable to the stockholders of Jabil Inc.:

Income from continuing operations, net of tax

Discontinued operations, net of

Income from continuing operations, net of tax

Discontinued operations, net of

Fiscal Year Ended August 31,

(in thousands)

14 unchanged sentences

Payments to acquire treasury stock

During fiscal year 2014, we sold our Aftermarket Services business for consideration of $725.0 million.

Working capital is defined as current assets minus current liabilities.

Managements Discussion and Analysis of Financial Condition

and Results of Operations

We are one of the leading providers of worldwide manufacturing services and solutions.

We provide comprehensive electronics design, production

and product management services to companies in various industries and end markets.

We derive substantially all of our revenue from production and product management services (collectively referred to as manufacturing services), which

encompass the act of producing tangible components that are built to customer specifications and are then provided to the customer.

have two reporting segments:

Electronics Manufacturing Services (EMS) and Diversified Manufacturing Services (DMS), which are organized based on the economic profiles of the services performed, including manufacturing

capabilities, market strategy, margins, return on capital and risk profiles.

Our EMS segment is focused around leveraging IT, supply chain design and engineering, technologies largely centered on core electronics, utilizing our large scale

manufacturing infrastructure and our ability to serve a broad range of end markets.

Our EMS segment is a high volume business that produces product at a quicker rate (i.e.

cycle time) and in larger quantities and includes customers primarily in the

automotive and transportation, capital equipment, cloud, computing and storage, defense and aerospace, industrial and energy, networking and telecommunications, print and retail, and smart home and appliances industries.

Our DMS segment is focused

on providing engineering solutions, with an emphasis on material sciences, technologies and healthcare.

Our DMS segment includes customers primarily in the edge devices and accessories, healthcare, mobility and packaging industries.

Our cost of revenue includes the cost of electronic components and other materials that comprise the products we manufacture;

labor and manufacturing overhead;

and adjustments for excess and obsolete inventory.

As a provider of turnkey manufacturing services, we are responsible for procuring components and other materials.

This requires us to commit significant working

capital to our operations and to manage the purchasing, receiving, inspecting and stocking of materials.

Although we bear the risk of fluctuations in the cost of materials and excess scrap, our ability to purchase components and materials

efficiently may contribute significantly to our operating results.

While we periodically negotiate cost of materials adjustments with our customers, rising component and material prices may negatively affect our margins.

Net revenue from each

product that we manufacture consists of an element based on the costs of materials in that product and an element based on the labor and manufacturing overhead costs allocated to that product.

Our gross margin for any product depends on the mix

between the cost of materials in the product and the cost of labor and manufacturing overhead allocated to the product.

Our operating

results are impacted by the level of capacity utilization of manufacturing facilities;

indirect labor costs;

and selling, general and administrative expenses.

Operating income margins have generally improved during periods of high production volume

and high capacity utilization.

During periods of low production volume, we generally have reduced operating income margins.

the current economic environment and its potential impact on both the customers we serve as well as our end markets and closely manage our costs and capital resources so that we can try to respond appropriately as circumstances change.

We have consistently utilized advanced circuit design, production design and manufacturing technologies to meet the needs of our customers.

support this effort, our engineering staff focuses on developing and refining design and manufacturing technologies to meet specific needs of specific customers.

Most of the expenses associated with these customer-specific efforts are reflected in

our cost of revenue.

In addition, our engineers engage in research and development (R&D) of new technologies that apply generally to our operations.

The expenses of these R&D activities are reflected in the research and

development line item within our Consolidated Statement of Operations.

An important element of our strategy is the expansion of our

global production facilities.

The majority of our revenue and materials costs worldwide are denominated in U.S.

dollars, while our labor and utility costs in operations outside the U.S.

are denominated in local currencies.

We economically hedge

certain of these local currency costs, based on our evaluation of the potential exposure as compared to the cost of the hedge, through the purchase of foreign currency exchange contracts.

Changes in the fair market value of such hedging instruments

are reflected within the Consolidated Statement of Operations and the Consolidated Statement of Comprehensive Income.

See Note 12

Concentration of Risk and Segment Data to the Consolidated Financial Statements.

Summary of Results

The following table sets forth, for the periods indicated, certain key operating results and other financial information (in thousands, except

per share data):

Fiscal Year Ended August 31,

Operating income

Net income attributable to Jabil Inc.

Earnings per share basic

Earnings per share diluted

Key Performance Indicators

Management regularly reviews financial and non-financial performance indicators to assess the

Companys operating results.

The following table sets forth, for the quarterly periods indicated, certain of managements key financial performance indicators:

Three Months Ended

August 31, 2019

February 28, 2019

November 30, 2018

Sales cycle (1)

Inventory turns (annualized) (2)

Days in accounts receivable (3)

Days in inventory (4)

Days in accounts payable (5)

Three Months Ended

August 31, 2018

February 28, 2018

November 30, 2017

Sales cycle (1)

Inventory turns (annualized)

Days in accounts receivable

Days in inventory (4)

Days in accounts payable (5)

The sales cycle is calculated as the sum of days in accounts receivable and days in inventory, less the days in

accounts payable;

accordingly, the variance in the sales cycle quarter over quarter is a direct result of changes in these indicators.

In connection with the adoption of Accounting Standards Update

2014-09 (ASU 2014-09), Revenue Recognition (Topic 606), inventory turns are calculated based on inventory and contract asset balances for the three

months ended August 31, 2019, May 31, 2019, February 28, 2019 and November 30, 2018.

During the three months ended November 30, 2018, the increase in days in accounts receivable from the

prior sequential quarter was primarily due to an increase in accounts receivable, primarily driven by the amended and new securitization programs and higher sales and timing of collections.

In connection with the adoption of ASU 2014-09, days in inventory are

calculated based on inventory and contract asset balances for the three months ended August 31, 2019, May 31, 2019, February 28, 2019 and November 30, 2018.

During the three months ended August 31, 2019, the decrease in days

in inventory from prior sequential quarter was primarily due to increased sales activity during the quarter.

During the three months ended February 28, 2019, days in inventory increased from the prior sequential quarter to support anticipated

ramps and expected sales levels in the second half of fiscal year 2019 and due to the acquisition of certain assets of Johnson & Johnson Medical Devices Companies (JJMD) facilities at the end of February.

During the three months

ended November 30, 2018, days in inventory increased from the prior sequential quarter to support expected sales levels in the second quarter of fiscal year 2019.

During each of the three months ended August 31, 2018 and May 31, 2018,

the decrease in days in inventory from the prior sequential quarter was primarily due to increased sales activity during the quarter.

During the three months ended February 28, 2018, the increase in days in inventory from the prior sequential

quarter was primarily due to the increase in inventories to support expected sales levels in the third quarter of fiscal year 2018 along with overall increased demand.

During the three months ended May 31, 2019, the decrease in days in accounts payable from the prior

sequential quarter was primarily due to timing of purchases and cash payments for purchases during the quarter.

During the three months ended February 28, 2019, the decrease in days in accounts payable from the prior sequential quarter was

primarily due to lower materials purchases during the quarter and timing of purchases and cash payments for purchases during the quarter.

During the three months ended August 31, 2018, the increase in days in accounts payable from the prior

sequential quarter was primarily due to higher materials purchases during the quarter and the timing of purchases and cash payments for purchases during the quarter.

During the three months ended May 31, 2018, the decrease in days in accounts

payable from the prior sequential quarter was primarily due to the timing of purchases and cash payments for purchases during the quarter.

Critical Accounting Policies and Estimates

The preparation of our Consolidated Financial Statements and related disclosures in conformity with U.S.

generally accepted accounting

principles (U.S.

GAAP) requires management to make estimates and judgments that affect our reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities.

On an on-going basis, we evaluate our estimates and assumptions based upon historical experience and various other factors and circumstances.

Management believes that our estimates and assumptions are reasonable under the

circumstances;

however, actual results may vary from these estimates and assumptions under different future circumstances.

We have identified the following critical accounting policies that affect the more significant judgments and estimates used in

the preparation of our Consolidated Financial Statements.

For further discussion of our significant accounting policies, refer to Note 1 Description of Business and Summary of Significant Accounting Policies to the

Consolidated Financial Statements.

Revenue Recognition

Effective September 1, 2018, our revenue recognition accounting policies changed in conjunction with the adoption of the new revenue

recognition standard.

For further discussion, refer to Note 18Revenue to the Consolidated Financial Statements.

We derive substantially all of our revenue from production and product management services (collectively referred to as

manufacturing services), which encompasses the act of producing tangible products that are built to customer specifications, which are then provided to the customer.

We generally enter into manufacturing service contracts with our customers that provide the framework under which business will be conducted

and customer purchase orders will be received for specific quantities and with predominantly fixed pricing.

As a result, we consider our contract with a customer to be the combination of the manufacturing service contract and the purchase order, or

any agreements or other similar documents.

The majority of our manufacturing service contracts relate to manufactured products which have

no alternative use and for which we have an enforceable right to payment for the work completed to date.

As a result, revenue is recognized over time when or as we transfer control of the promised products or services (known as performance

obligations) to our customers.

For certain other contracts with customers that do not meet the over time revenue recognition criteria, transfer of control occurs at a point in time which generally occurs upon delivery and transfer of risk and title

to the customer.

Most of our contracts have a single performance obligation as the promise to transfer the individual manufactured

product or service is capable of being distinct and is distinct within the context of the contract.

For the majority of customers, performance obligations are satisfied over time based on the continuous transfer of control as manufacturing services

are performed and are generally completed in less than one year.

We also derive revenue to a lesser extent from electronic design

services to certain customers.

Revenue from electronic design services is generally recognized over time as the services are performed.

For our over time customers, we believe the measure of progress which best depicts the transfer of control is based on costs incurred to date,

relative to total estimated cost at completion (i.e., an input method).

This method is a faithful depiction of the transfer of goods or services because it results in the recognition of revenue on the basis of our

to-date efforts in the satisfaction of a performance obligation relative to the total expected efforts in the satisfaction of the performance obligation.

We believe that the use of an input method best depicts

the transfer of control to the customer, which occurs as we incur costs on our contracts.

The transaction price of each performance obligation is generally based upon the contractual stand-alone selling price of the product or service.

Certain contracts with customers include variable consideration, such as rebates, discounts, or returns.

We recognize estimates of this

variable consideration that are not expected to result in a significant revenue reversal in the future, primarily based on the most likely level of consideration to be paid to the customer under the specific terms of the underlying programs.

Allowance for Doubtful Accounts

We maintain an allowance for doubtful accounts related to receivables not expected to be collected from our customers.

This allowance is based

on managements assessment of specific customer balances after considering the age of receivables and financial stability of the customer.

If there is an adverse change in the financial condition and circumstances of our customers, or if actual

defaults are higher than provided for, an addition to the allowance may be necessary.

Inventory Valuation

We purchase inventory based on forecasted demand and record inventory at the lower of cost and net realizable value.

Management regularly

assesses inventory valuation based on current and forecasted usage, customer inventory-related contractual obligations and other lower of cost and net realizable value considerations.

If actual market conditions or our customers product

demands are less favorable than those projected, additional valuation adjustments may be necessary.

Long-Lived Assets

We review property, plant and equipment and amortizable intangible assets for impairment whenever events or changes in circumstances indicate

that the carrying amount of an asset may not be recoverable.

Recoverability of property, plant and equipment is measured by comparing its carrying value to the undiscounted projected cash flows that the asset(s) or asset group(s) are expected to

If the carrying amount of an asset or an asset group is not recoverable, we recognize an impairment loss based on the excess of the carrying amount of the long-lived asset or asset group over its respective fair value, which is generally

determined as either the present value of estimated future cash flows or the appraised value.

The impairment analysis is based on significant assumptions of future results made by management, including revenue and cash flow projections.

Circumstances that may lead to impairment of property, plant and equipment include unforeseen decreases in future performance or industry demand and the restructuring of our operations resulting from a change in our business strategy or adverse

economic conditions.

We have recorded intangible assets, including goodwill, in connection with business acquisitions.

Estimated useful

lives of amortizable intangible assets are determined by management based on an assessment of the period over which the asset is expected to contribute to future cash flows.

The fair value of acquired amortizable intangible assets impacts the

amounts recorded as goodwill.

We perform a goodwill impairment analysis using the two-step method

on an annual basis and whenever events or changes in circumstances indicate that the carrying value may not be recoverable.

The recoverability of goodwill is measured at the reporting unit level by comparing the reporting units carrying

amount, including goodwill, to the fair value of the reporting unit.

We determine the fair value of our reporting units based on an average weighting of both projected discounted future results and the use of comparative market multiples.

carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired and a second test is performed to measure the amount of loss, if any.

We perform an indefinite-lived intangible asset impairment analysis on an annual basis and whenever events or changes in circumstances

indicate that the carrying value may not be recoverable.

The recoverability of indefinite-lived intangible assets is measured by comparing the carrying amount to the fair value.

We determine the fair value of our indefinite-lived intangible assets

principally based on a variation of the income approach, known as the relief from royalty method.

If the carrying amount of the indefinite-lived intangible asset exceeds its fair value, the indefinite-lived intangible asset is considered impaired.

We completed our annual impairment test for goodwill and indefinite-lived intangible assets during the fourth quarter of fiscal year 2019

and determined that the fair values of our reporting units and the indefinite-lived intangible assets are in excess of the carrying values and that no impairment existed as of the date of the impairment test.

Significant judgments inherent in this

analysis included assumptions regarding appropriate revenue and operating income growth rates, discount rates and royalty rates.

We estimate our income tax provision in each of the jurisdictions in which we operate, a process that includes estimating exposures related to

examinations by taxing authorities.

We must also make judgments regarding the ability to realize deferred tax assets.

The carrying value of our net deferred tax assets is based on our belief that it is more likely than not that we will generate

sufficient future taxable income in certain jurisdictions to realize these deferred tax assets.

A valuation allowance has been established for deferred tax assets that we do not believe meet the more likely than not criteria.

whether an uncertain tax position taken or expected to be taken in a tax return meets the threshold for recognition and measurement in the

Consolidated Financial Statements.

Our judgments regarding future taxable income as well as tax positions taken or expected to be taken in a tax return may change due to changes in market

conditions, changes in tax laws or other factors.

If our assumptions and consequently our estimates change in the future, the valuation allowances and/or tax reserves established may be increased or decreased, resulting in a respective increase or

decrease in income tax expense.

For further discussion related to our income taxes, refer to Note 4 Income Taxes to the Consolidated Financial Statements.

Recent Accounting Pronouncements

Note 17 New Accounting Guidance to the Consolidated Financial Statements for a discussion of recent accounting guidance.

Refer to Item 7.

Managements Discussion and Analysis of Financial Condition and Results of Operations

section contained in our Annual Report on Form 10-K for the fiscal year ended August 31, 2018 for the results of operations discussion for the fiscal year ended August 31, 2018 compared to the fiscal

year ended August 31, 2017.

Generally, we assess revenue on a global customer basis regardless of whether the growth is associated with organic growth or as a result of an

Accordingly, we do not differentiate or separately report revenue increases generated by acquisitions as opposed to existing business.

In addition, the added cost structures associated with our acquisitions have historically been

relatively insignificant when compared to our overall cost structure.

The distribution of revenue across our segments has fluctuated, and

will continue to fluctuate, as a result of numerous factors, including the following:

fluctuations in customer demand;

efforts to diversify certain portions of our business;

business growth from new and existing customers;

specific product

and any potential termination, or substantial winding down, of significant customer relationships.

Fiscal Year Ended August 31,

(dollars in millions)

Net revenue increased during the fiscal year ended August 31, 2019 compared to the fiscal year ended August 31, 2018.

Specifically,

the EMS segment revenues increased 26% primarily due to (i) a 10% increase in revenues from new customers within our cloud business, (ii) an 8% increase in revenues from existing customers within our industrial and energy business,

(iii) a 6% increase in revenues from existing customers within our networking and telecommunications business, (iv) a 5% increase in revenues from existing customers within our print and retail business and (v) a 1% increase in

revenues spread across various industries within the EMS segment.

The increase is partially offset by a 4% decrease from existing customers within our computing and storage business and our capital equipment business, which we expect to remain weak

into the second half of calendar year 2020.

DMS segment revenues remained consistent due to a 7% increase in revenues from new and existing customers in our healthcare and packaging businesses.

The increase is offset by a 7% decrease in revenue from

customers within our mobility business as a result of decreased end user product demand.

Effective September 1, 2018, our revenue

recognition accounting policies changed in conjunction with the adoption of the new revenue recognition standard.

Subsequent to adoption, we recognize revenue over time as manufacturing services are performed for the majority of our contracts with

customers, which results in revenue being recognized earlier than under the previous guidance.

Revenue for all other contracts with customers will be recognized at a point in time, upon transfer of control of the product to the customer, which is

effectively no change to our historical accounting.

For further discussion of the new revenue recognition standard, refer to Note 18Revenue to the Consolidated Financial Statements.

The following table sets forth, for the periods indicated, revenue by segment expressed as a

percentage of net revenue:

Fiscal Year Ended August 31,

The following table sets forth, for the periods indicated, foreign source revenue expressed as a percentage of

Fiscal Year Ended August 31,

Foreign source revenue

Fiscal Year Ended August 31,

(dollars in millions)

Percent of net revenue

For the fiscal year ended August 31, 2019, gross profit for our DMS segment increased as a percentage of net revenue due to improved

profitability across the various businesses.

This increase was offset by a decrease in gross profit as a percentage of net revenue in our EMS segment due to continued weakness in the capital equipment business and ramp costs associated with new

business awards.

As a result, gross profit remained relatively consistent as a percentage of net revenue during the fiscal year end August 31, 2019, compared to the fiscal year end August 31, 2018.

Selling, General and Administrative

Fiscal Year Ended August 31,

(dollars in millions)

Selling, general and administrative

Selling, general and administrative expenses increased during the fiscal year ended August 31, 2019 compared to the fiscal year ended

August 31, 2018.

The increase is predominantly due to (i) a $48.4 million increase in salary and salary related expenses and other costs primarily to support new business growth and development and our strategic collaboration with a

healthcare company and (ii) a $44.6 million increase in acquisition and integration charges related to our strategic collaboration with a healthcare company.

The increase is partially offset by an additional $32.4 million of

stock-based compensation expense recognized during the fiscal year ended August 31, 2018 as a result of the one-time modification of certain performance-based restricted stock unit awards and a one-time cash-settled award.

Research and Development

Fiscal Year Ended August 31,

(dollars in millions)

Research and development

Percent of net revenue

Research and development expenses remained consistent as a percent of net revenue during the fiscal year ended August 31, 2019 compared

to the fiscal year ended August 31, 2018.

Amortization of Intangibles

Fiscal Year Ended August 31,

(dollars in millions)

Amortization of intangibles

Amortization of intangibles decreased during the fiscal year ended August 31, 2019 compared to the fiscal year ended August 31, 2018

primarily due to intangible assets related to the Nypro acquisition, which were fully amortized during fiscal year 2018.

In the fourth

quarter of fiscal year 2019, we made a strategic decision that the indefinite-lived trade name of $72.5 million acquired during the acquisition of Nypro would be phased out over the next four years.

In connection with a strategic shift to

further diversify our portfolio, focus on innovation and technology within our healthcare business and as a result of the strategic collaboration with a certain medical device company, we decided to implement a rebranding initiative to Jabil

Management believes the name change better leverages the Jabil brand and the full range of services available to our customers.

As a result of our decision to rebrand, we determined the indefinite-lived trade name should no longer be classified as an indefinite-lived

intangible asset.

As such, this trade name was assigned a four-year estimated useful life and will be amortized on an accelerated basis.

See Note 6 Goodwill and Other Intangible Assets to the Consolidated Financial Statements for

further discussion.

Restructuring and Related Charges

Following is a summary of our restructuring and related charges:

Fiscal Year Ended August 31,

(dollars in millions)

Employee severance and benefit costs

Asset write-off costs

Total restructuring and related

Includes $21.5 million, $16.3 million and $51.3 million recorded in the EMS segment,

$2.6 million, $16.6 million and $82.4 million recorded in the DMS segment and $1.8 million, $4.0 million and $26.7 million of non-allocated charges for the fiscal years ended

August 31, 2019, 2018 and 2017, respectively.

Except for asset write-off costs, all restructuring and related charges are cash settled.

Fiscal year ended August 31, 2017, includes expenses related to the 2017 and 2013 Restructuring Plans.

2017 Restructuring Plan

On September 15, 2016, our Board of Directors formally approved a restructuring plan to better align our global capacity and

administrative support infrastructure to further optimize organizational effectiveness.

This action included headcount reductions across our selling, general and administrative cost base and capacity realignment in higher cost locations (the

2017 Restructuring Plan).

The 2017 Restructuring Plan, totaling $195.0 million in restructuring and related costs, is

complete as of August 31, 2019.

2020 Restructuring Plan

On September 20, 2019, our Board of Directors formally approved a restructuring plan to realign our global capacity support

infrastructure, particularly in our mobility footprint in China, in order to optimize organizational effectiveness.

This action includes headcount reductions and capacity realignment (the 2020 Restructuring Plan).

The 2020 Restructuring

Plan reflects our intention only and restructuring decisions, and the timing of such decisions, at certain locations are still subject to consultation with our employees and their representatives.

We currently expect to recognize approximately $85.0 million in pre-tax restructuring and other

related costs primarily over the course of our fiscal year 2020.

The charges relating to the 2020 Restructuring Plan are currently expected to result in cash expenditures in the range of approximately $30.0 million to $40.0 million that

will be payable over the course of our fiscal years 2020 and 2021.

The exact timing of these charges and cash outflows, as well as the estimated cost ranges by category type, have not been finalized.

This information will be subject to the

finalization of timetables for the transition of functions, consultation with employees and their representatives as well as the statutory severance requirements of the particular jurisdictions impacted, and the amount and timing of the actual

charges may vary due to a variety of factors.

Our estimates for the charges discussed above exclude any potential income tax effects.

Note 14 Restructuring and Related Charges to the Consolidated Financial Statements for further discussion of restructuring and related charges for the 2017 and 2020 Restructuring Plans.

Restructuring of Securities

Fiscal Year Ended August 31,

(dollars in millions)

Restructuring of securities loss

Restructuring of securities loss increased during the fiscal year ended August 31, 2019 compared to the fiscal year ended August 31,

2018, due to the exchange of preferred stock of iQor Holdings, Inc.

(iQor) during the fourth quarter of fiscal year 2019 in association with iQors previously announced sale of its international logistics and product service assets.

As a result of the restructuring, the Company recognized a restructuring of securities loss, which primarily consisted of a credit loss.

See Note 16 Fair Value Measurements to the Consolidated Financial Statements for further

Other Expense

Fiscal Year Ended August 31,

(dollars in millions)

Other expense

Other expense increased during the fiscal year ended August 31, 2019 compared to the fiscal year ended August 31, 2018, primarily due

(i) $23.8 million related to an increase in fees associated with the utilization of the trade accounts receivable sales programs and additional fees incurred for the amendment of the foreign asset-backed securitization program and the new

North American asset-backed securitization program.

The increase was partially offset by (i) $5.0 million of other expense and (ii) $2.6 million of costs incurred during the fiscal year ended August 31, 2018, as a result of the early

redemption of the 8.250% Senior Notes due 2018.

Interest Income

Fiscal Year Ended August 31,

(dollars in millions)

Interest income

Interest income increased during the fiscal year ended August 31, 2019 compared to the fiscal year ended August 31, 2018 due to

increased cash equivalents (investments that are readily convertible to cash with maturity dates of 90 days or less).

Interest Expense

Fiscal Year Ended August 31,

(dollars in millions)

Interest expense

Interest expense increased during the fiscal year ended August 31, 2019, compared to the fiscal year ended August 31, 2018, due to

additional borrowings on our credit facilities and higher interest rates.

For the fiscal year ended August 31, 2019, additional borrowings were driven by the timing and scale of our ongoing new business ramps.

Income Tax Expense

Fiscal Year Ended August 31,

Effective income tax rate

The effective income tax rate decreased for the fiscal year ended August 31, 2019, compared to the fiscal year ended August 31, 2018,

primarily due to:

(i) $142.3 million of tax expense from the Tax Cuts and Jobs Act of 2017 (Tax Act) for the fiscal year ended August 31, 2018, (ii) $19.1 million of tax benefit for the fiscal year ended August 31,

2019 related to Tax Act adjustments and (iii) $17.5 million of tax benefit for the reversal of a U.S.

valuation allowance for the fiscal year ended August 31, 2019.

The decrease was partially offset by $16.1 million of tax benefit

from the lapse of statute in a non-U.S.

jurisdiction and $14.8 million of tax benefit related to the release of stranded tax effects previously classified as accumulated other comprehensive income

(AOCI) for the fiscal year ended August 31, 2018.

Refer to Note 4 Income Taxes to the Consolidated Financial Statements for further information on the Tax Act.

Non-GAAP (Core) Financial Measures

The following discussion and analysis of our financial condition and results of operations include certain

non-GAAP financial measures as identified in the reconciliation below.

The non-GAAP financial measures disclosed herein do not have standard meaning and may vary from

the non-GAAP financial measures used by other companies or how we may calculate those measures in other instances from time to time.

Non-GAAP financial measures should

not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S.

Also, our core financial measures should not be construed as an inference by us that our future results

will be unaffected by those items that are excluded from our core financial measures.

Management believes that the non-GAAP core financial measures set forth below are useful to facilitate evaluating the past and future performance of our ongoing manufacturing operations over multiple periods on a comparable basis by

excluding the effects of the amortization of intangibles, stock-based compensation expense and related charges, restructuring and related charges, distressed customer charges, acquisition and integration charges, loss on disposal of subsidiaries,

settlement of receivables and related charges, impairment of notes receivable and related charges, goodwill impairment charges, business interruption and impairment charges, net, other than temporary impairment on securities, restructuring of

securities loss, income (loss) from discontinued operations, gain (loss) on sale of discontinued operations and certain other expenses, net of tax and certain deferred tax valuation allowance charges.

Among other uses, management uses non-GAAP core financial measures to make operating decisions, assess business performance and as a factor in determining certain employee performance when evaluating incentive compensation.

We determine the tax effect of the items excluded from core earnings and core diluted earnings per share based upon

evaluation of the statutory tax treatment and the applicable tax rate of the jurisdiction in which the pre-tax items were incurred, and for which realization of the resulting tax benefit, if any, is expected.

In certain jurisdictions where we do not expect to realize a tax benefit (due to existing tax incentives or a history of operating losses or other factors resulting in a valuation allowance related to deferred tax assets), a reduced or 0% tax rate

We are reporting core operating income, core earnings and core return on invested capital

to provide investors with an additional method for assessing operating income and earnings, by presenting what we believe are our core manufacturing operations.

A significant portion (based on the respective values) of the items that are

excluded for purposes of calculating core operating income and core earnings also impacted certain balance sheet assets, resulting in a portion of an asset being written off without a corresponding recovery of cash we may

have previously spent with respect to the asset.

In the case of restructuring and related charges, we may make associated cash payments in the future.

In addition, although, for purposes of calculating core operating income and

core earnings, we exclude stock-based compensation expense (which we anticipate continuing to incur in the future) because it is a non-cash expense, the associated stock issued may result in an

increase in our outstanding shares of stock, which may result in the dilution of our stockholders ownership interest.

We encourage you to consider these matters when evaluating the utility of these

non-GAAP financial measures.

Included in the tables below are a reconciliation of the

non-GAAP financial measures to the most directly comparable U.S.

GAAP financial measures as provided in our Consolidated Financial Statements:

Reconciliation of U.S.

GAAP Financial Results to Non-GAAP Measures

Fiscal Year Ended August 31,

(in thousands, except for per share data)

Operating income (U.S.

Amortization of intangibles

Stock-based compensation expense and related charges

Restructuring and related charges

Distressed customer charges (1)

Business interruption and impairment charges,

Acquisition and integration

Loss on disposal of subsidiaries

Adjustments to operating income

Core operating income (Non-GAAP)

Net income attributable to Jabil Inc.

Adjustments to operating income

Other than temporary impairment on securities

Restructuring of securities loss (4)

Adjustment for taxes (5)

Core earnings (Non-GAAP)

Diluted earnings per share (U.S.

Diluted core earnings per share (Non-GAAP)

Diluted weighted average shares outstanding used in the calculation of earnings per share (U.S.

GAAP and Non-GAAP)

Charges during fiscal years 2019 and 2018 relate to inventory and other assets charges for certain distressed

customers in the networking and consumer wearables sectors.

Charges during fiscal year 2017 relate to inventory and other assets charges for the disengagement with an energy customer.

Charges, net of insurance proceeds of $2.9 million and $24.9 million, for the fiscal years ended

August 31, 2019 and 2018, respectively, relate to business interruption and asset impairment costs associated with damage from Hurricane Maria, which impacted our operations in Cayey, Puerto Rico.

Charges related to our strategic collaboration with Johnson & Johnson Medical Devices Companies

Relates to a restructuring of securities loss on available for sale securities during fiscal year 2019.

Note 16 Fair Value Measurements to the Consolidated Financial Statements for further discussion.

The fiscal year ended August 31, 2019 includes a $13.3 million income tax benefit for the effects of

the Tax Act recorded during the three months ended November 30, 2018.

The fiscal year ended August 31, 2018 includes a $142.3 million provisional estimate to account for the effects of the Tax Act.

ROIC & Core ROIC

Fiscal Year Ended August 31,

(in thousands)

Operating income (U.S.

Tax effect (1)

After-tax operating income

Annualized after-tax operating income

Core operating income (Non-GAAP)

Tax effect (2)

After-tax core operating income

Annualized after-tax core operating income

Average total Jabil Inc.

stockholders equity

Average notes payable and long-term debt, less current installments (3)

Average current installments of notes payable and long-term debt (3)

Average cash and cash equivalents

Net invested capital base

Return on Invested Capital (U.S.

Adjustments noted above

Core Return on Invested Capital

The tax effect is calculated by applying the U.S.

GAAP effective tax rate for the fiscal years ended

August 31, 2019, 2018, and 2017 to U.S.

GAAP operating income less interest expense.

The tax effect is calculated by applying the core effective tax rate for the fiscal years ended August 31,

2019, 2018 and 2017 to core operating income less interest expense.

The average is based on the addition of the account balance at the end of the most recently-ended fiscal year

to the account balance at the end of the prior fiscal year for the fiscal years ended August 31, 2019, 2018 and 2017, respectively, and dividing by two.

Quarterly Results (Unaudited)

following table sets forth certain unaudited quarterly financial information for the 2019 and 2018 fiscal years.

In the opinion of management, this information has been presented on the same basis as the audited consolidated financial statements

appearing elsewhere, and all necessary adjustments (consisting primarily of normal recurring accruals) have been included in the amounts stated below to present fairly the unaudited quarterly results when read in conjunction with the audited

consolidated financial statements and related notes thereto.

The operating results for any quarter are not necessarily indicative of results for any future period.

Fiscal Year 2019

Three Months Ended

(in thousands, except for per share data)

August 31, 2019

February 28, 2019

November 30, 2018

Gross profit (4)

Operating income (1)(4)

Net income (2)(3)(4)

Net income attributable to Jabil

Earnings per share attributable to the stockholders of Jabil Inc.

Fiscal Year 2018

Three Months Ended

(in thousands, except for per share data)

August 31, 2018

February 28, 2018

November 30, 2017

Gross profit (4)

Operating income (1)(4)(5)

Net (loss) income (2)(4)(5)

Net (loss) income attributable to Jabil

(Loss) earnings per share attributable to the stockholders of Jabil Inc.

Includes acquisition and integration charges related to our strategic collaboration with JJMD of

$17.6 million, $13.4 million, $12.8 million, $8.9 million and $8.1 million for the three months ended August 31, 2019, May 31, 2019, February 28, 2019, November 30, 2018 and August 31, 2018,

respectively.

Includes ($13.3 million), $111.4 million and $30.9 million of income tax (benefit) expense for the

three months ended November 30, 2018, August 31, 2018 and February 28, 2018, respectively, related to the Tax Act.

Includes a restructuring of securities loss of $29.6 million for the three months ended August 31,

Includes a distressed customer charge of $6.2 million, $18.0 million and $14.7 million during

the three months ended August 31, 2019, August 31, 2018 and February 28, 2018, respectively.

Includes $32.4 million of stock-based compensation expense for the modification of certain

performance-based restricted stock units and a one-time cash settled award during the three months ended November 30, 2017.

Acquisitions and Expansion

During fiscal year 2018, the Company and JJMD entered into a Framework Agreement to form a strategic collaboration and expand our existing

relationship.

The strategic collaboration expands our medical device manufacturing portfolio, diversification and capabilities.

February 25, 2019 and April 29, 2019, under the terms of the Framework Agreement, we completed the initial closing and second closing, respectively, of our acquisition of certain assets of JJMD.

The preliminary aggregate purchase price

paid for both the initial closing and second closing was approximately $153.2 million in cash, which remains subject to certain post-closing adjustments.

The acquisition of the JJMD assets has been accounted for as a business combination using

the acquisition method of accounting.

Total assets acquired of $167.6 million and total liabilities assumed of $14.4 million were recorded at their estimated fair values as of the acquisition dates.

The final closing, which is subject to

customary closing conditions, is expected to occur during fiscal year 2020.

We are currently evaluating the fair values of the assets and

liabilities related to this business combination.

The preliminary estimates and measurements are, therefore, subject to change during the measurement period for assets acquired, liabilities assumed and tax adjustments.

The results of operations were

included in our consolidated financial results beginning on February 25, 2019 for the initial closing and April 29, 2019 for the second closing.

We believe it is impracticable to provide pro forma information for the acquisition of JJMD

On September 30, 2019 we completed the third closing of our acquisition of certain assets of JJMD for a cash payment of

$117.1 million, primarily for inventory and the assumption of certain employee liabilities.

The purchase price for the third closing is subject to certain post-closing adjustments based on conditions within the Framework Agreement.

Refer to Note 15 Business Acquisitions to the Consolidated Financial Statements for further discussion.

Liquidity and Capital Resources

believe that our level of liquidity sources, which includes available borrowings under our revolving credit facilities and commercial paper program, additional proceeds available under our asset-backed securitization programs and under our

uncommitted trade accounts receivable sale programs, cash on hand, funds provided by operations and the access to the capital markets, will be adequate to fund our capital expenditures, the payment of any declared quarterly dividends, approved share

repurchase programs, any potential acquisitions and our working capital requirements for the next 12 months.

We continue to assess our capital structure and evaluate the merits of redeploying available cash to reduce existing debt or repurchase

common stock.

Cash and Cash Equivalents

As of August 31, 2019, we had approximately $1.2 billion in cash and cash equivalents.

As our growth remains predominantly outside of

the United States, a significant portion of such cash and cash equivalents are held by our foreign subsidiaries.

As a result of the Tax

Act and after the one-time transition tax on our historically untaxed foreign earnings, the cash and cash equivalents held by our foreign subsidiaries will no longer be subject to U.S.

federal income tax

consequences upon subsequent repatriation to the United States.

As a result, most of our cash and cash equivalents as of August 31, 2019 could be repatriated to the United States without potential tax consequences.

Notes Payable and Credit Facilities

Following is a summary of principal debt payments and debt issuance for our notes payable and credit facilities:

(in thousands)

facilities (2)(3)(4)

Balance as of August 31, 2017

Balance as of August 31, 2018

Balance as of August 31, 2019

Maturity Date

Original Facility/ Maximum Capacity

billion (2)(3)

million (2)(3)

During the fiscal year ended August 31, 2018, we issued $500.0 million of publicly registered 3.950%

Senior Notes due 2028 (the 3.950% Senior Notes).

The net proceeds from the offering were used for general corporate purposes, including to redeem $400.0 million of our outstanding 8.250% Senior Notes due 2018 and pay related costs

and a make-whole premium.

On November 8, 2017, we entered into an amended and restated senior unsecured five-year credit agreement

to support the continued growth of the business.

In addition, the revolving credit facility supports commercial paper outstanding, if any.

The credit agreement provides for:

(i) a Revolving Credit Facility in the initial amount of

$1.8 billion, which may, subject to the lenders discretion, be increased to $2.3 billion (the 2017 Revolving Credit Facility) and (ii) a $500.0 million Term Loan Facility (the 2017 Term Loan

Facility), collectively the 2017 Credit Facility. The 2017 Credit Facility expires on November 8, 2022.

The 2017 Revolving Credit Facility is subject to two whole or partial one-year

extensions, at the lenders discretion.

Interest and fees on the 2017 Credit Facility advances are based on the Companys non-credit enhanced long-term senior unsecured debt rating as determined by

Standard & Poors Ratings Service, Moodys Investors Service and Fitch Ratings.

On August 24, 2018, the Company entered into a senior unsecured

two-year credit agreement to support the continued growth of the business.

The credit agreement provides for:

(i) a Revolving Credit Facility in the initial amount of $150.0 million (the 2018

Revolving Credit Facility) and (ii) a $350.0 million Term Loan Facility (the 2018 Term Loan Facility), collectively the 2018 Credit Facility. The 2018 Credit Facility expires on August 24, 2020.

The interest rates on the 2017 Revolving Credit Facility borrowings ranged from 3.1% to 5.7% and the 2017 Term Loan

Facility ranged from 3.5% to 3.9% during the fiscal year ended August 31, 2019.

The interest rate on the 2018 Revolving Credit Facility borrowings ranged from 3.1% to 3.4% and the 2018 Term Loan Facility ranged from 3.3% to 3.8% during the

fiscal year ended August 31, 2019.

Additionally, our foreign subsidiaries have various additional credit facilities that finance

their future growth and any corresponding working capital needs.

On August 15, 2019, we entered into a commercial paper program with a borrowing capacity of up to

$1.8 billion.

We intend to use the net proceeds from the commercial paper to support more efficient financing terms.

The revolving credit facility supports commercial paper outstanding, if any.

As of August 31, 2019, no commercial paper

had been issued.

In the ordinary course of business, we have letters of credit and surety bonds with banks and

insurance companies outstanding of $119.1 million as of August 31, 2019.

Unused letters of credit were $74.7 million as of August 31, 2019.

Letters of credit and surety bonds are generally available for draw down in the event we

do not perform.

We have a shelf registration statement with the SEC registering the potential sale of an

indeterminate amount of debt and equity securities in the future to augment our liquidity and capital resources.

Our Senior Notes and our

2017 and 2018 Credit Facilities contain various financial and nonfinancial covenants.

A violation of these covenants could negatively impact our liquidity by restricting our ability to borrow under the notes payable and credit facilities and

potentially causing acceleration of amounts due under these notes payable and credit facilities.

As of August 31, 2019 and 2018, we were in compliance with all covenants under our Senior Notes and the 2017 and 2018 Credit Facilities.

Note 8 Notes Payable and Long-Term Debt to the Consolidated Financial Statements for further details.

Securitization and Trade Accounts Receivable Sale Programs

Asset-Backed Securitization Programs

We continuously sell designated pools of trade accounts receivable, at a discount, under our foreign asset-backed securitization program to a

special purpose entity, which in turn sells certain of the receivables to an unaffiliated financial institution and a conduit administered by an unaffiliated financial institution on a monthly basis.

Effective October 1, 2018, the foreign

asset-backed securitization program terms were amended and the program was extended to September 30, 2021.

In connection with this amendment, there is no longer a deferred purchase price receivable for the foreign asset-backed securitization

program as the entire purchase price is paid in cash when the receivables are sold.

As of October 1, 2018, approximately

$734.2 million of accounts receivable sold under the foreign asset-backed securitization program was exchanged for the outstanding deferred purchase price receivable of $335.5 million.

The remaining amount due to the financial institution

of $398.7 million was subsequently settled for $25.2 million of cash and $373.5 million of trade accounts receivable sold to the financial institution.

Prior to the amendment, any portion of the purchase price for the receivables not

paid in cash upon the sale occurring was recorded as a deferred purchase price receivable, which was paid from available cash as payments on the receivables were collected.

The amended foreign asset-backed securitization program contains a guarantee

of payment by the special purpose entity, in an amount equal to approximately the net cash proceeds under the program.

No liability has been recorded for obligations under the guarantee as of August 31, 2019.

The North American asset-backed securitization program was terminated on October 9, 2018 and as of this date approximately

$500.0 million of accounts receivable sold under the program was exchanged for the outstanding deferred purchase price receivable of $300.0 million and $200.0 million of cash.

The previously sold trade accounts receivable were

recorded at fair market value.

On November 27, 2018, we entered into a new North American asset-backed securitization program.

continuously sell designated pools of trade accounts receivable, at a discount, under our new North American asset-backed securitization program to a special purpose entity, which in turn sells certain of the receivables to conduits

administered by unaffiliated financial institutions on a monthly basis.

There is no longer a deferred purchase price receivable for the North American asset-backed securitization program as the entire purchase price is paid in cash when the

receivables are sold.

Additionally, certain unsold receivables covering the maximum amount of net cash proceeds available under the program are pledged as collateral to the unaffiliated financial institution as of August 31, 2019.

Following is a summary of our asset-backed securitization programs and key terms:

Maximum Amount of

Net Cash Proceeds (in

millions) (1)

North American

November 22, 2021

September 30, 2021

Maximum amount available at any one time.

In connection with our asset-backed securitization programs, during the fiscal year ended August 31, 2019, we sold $4.1 billion of

trade accounts receivable and we received cash proceeds of $4.0 billion.

As of August 31, 2019, we had up to $27.8 million in available liquidity under our asset-backed securitization programs.

Our asset-backed securitization programs contain various financial and nonfinancial covenants.

As of August 31, 2019 and 2018, we were in

compliance with all covenants under our asset-backed securitization programs.

Refer to Note 2 Trade Accounts Receivable Securitization and Sale Programs to the Consolidated Financial Statements for further details on the programs.

Trade Accounts Receivable Sale Programs

Following is a summary of the trade accounts receivable sale programs with unaffiliated financial institutions.

Under the programs we may elect

to sell receivables and the unaffiliated financial institutions may elect to purchase, at a discount, on an ongoing basis:

Amount (in millions) (1)

August 31, 2022

November 30, 2019

June 30, 2020

August 25, 2020

January 25, 2020

February 23, 2023

August 10, 2020

July 21, 2020

February 28, 2020

April 11, 2020

Maximum amount available at any one time.

Any party may elect to terminate the agreement upon 15 days prior notice.

The program will automatically extend for one year at each expiration date unless either party provides 10 days

notice of termination.

Any party may elect to terminate the agreement upon 30 days prior notice.

The program will be automatically extended through January 25, 2023 unless either party provides 30 days

notice of termination.

The program will be automatically extended through August 10, 2023 unless either party provides 30 days

notice of termination.

The program will be automatically extended through August 21, 2023 unless either party provides 30 days

notice of termination.

The program will be automatically extended through February 28, 2024 unless either party provides 90 days

notice of termination.

The program will be automatically extended each year through April 11, 2025 unless either party provides

30 days notice of termination.

During the fiscal year ended August 31, 2019, we sold $6.8 billion of trade

accounts receivable under these programs and we received cash proceeds of $6.7 billion.

As of August 31, 2019, we had up to $1.5 billion in available liquidity under our trade accounts receivable sale programs.

Capital Expenditures

year 2020, we anticipate our net capital expenditures will be approximately $800.0 million.

Our capital expenditures will support ongoing maintenance in our DMS and EMS segments and investments in new markets.

The amount of actual capital

expenditures may be affected by general economic, financial, competitive, legislative and regulatory factors, among other things.

The following table sets forth selected consolidated cash flow information (in thousands):

Fiscal Year Ended August 31,

Net cash provided by (used in) operating activities

Net cash (used in) provided by investing activities

Net cash used in financing activities

Effect of exchange rate changes on cash and cash equivalents

Net (decrease) increase in cash and cash equivalents

Operating Activities

Net cash provided by operating activities during the fiscal year ended August 31, 2019 was primarily due to increased accounts payable,

accrued expenses and other liabilities, decreased inventories and non-cash expenses, partially offset by increased contract assets and accounts receivable.

The increase in accounts payable, accrued expenses

and other liabilities is primarily due to the timing of collections on accounts receivable sold under the securitization programs and the timing of purchases and cash payments.

The decrease in inventories is primarily due to the adoption of ASU 2014-09 and the reclassification to contract assets for revenue recognized for over time customers, partially offset by an increase in inventories to support expected sales levels in the first quarter of fiscal year

The increase in contract assets is due to the adoption of ASU 2014-09 and the timing of revenue recognition for over time customers.

The increase in accounts receivable is primarily driven by the amended

and new securitization programs and higher sales and timing of collections.

Investing Activities

Net cash used in investing activities during the fiscal year ended August 31, 2019 consisted primarily of capital expenditures principally

to support ongoing business in the DMS and EMS segments and expenditures for assets acquired in connection with the initial and second closings of the acquisition of certain assets of JJMD, partially offset by proceeds and advances from the sale of

property, plant and equipment and cash receipts on sold receivables under the asset-backed securitization programs.

Financing Activities

Net cash used in financing activities during the fiscal year ended August 31, 2019 was primarily due to:

(i) payments for debt

agreements, (ii) the repurchase of our common stock, (iii) dividend payments and (iv) treasury stock minimum tax withholding related to vesting of restricted stock.

Net cash used in financing activities was partially offset by:

(i) borrowings under debt agreements and (ii) net proceeds from the exercise of stock options and issuance of common stock under the employee stock purchase plan.

Dividends and Share Repurchases

Following is a summary of the dividends and share repurchases for the fiscal years ended August 31, 2019, 2018, 2017 and 2016 (in

Dividends Paid (1)

Share Repurchases (2)

Fiscal year 2016

Fiscal year 2017

Fiscal year 2018

Fiscal year 2019

The difference between dividends declared and dividends paid is due to dividend equivalents for unvested

restricted stock units that are paid at the time the awards vest.

Excludes commissions.

We currently expect to continue to declare and pay regular quarterly dividends of an amount similar to our past declarations.

declaration and payment of future dividends are discretionary and will be subject to determination by our Board each quarter following its review of our financial performance.

In June 2018, the Board authorized the repurchase of up to $350.0 million of our common

As of August 31, 2019, the total amount authorized by the Board of Directors had been repurchased.

In September 2019, the

Board authorized the repurchase of up to $600.0 million of our common stock as part of a two-year capital allocation framework.

From September 24, 2019 through October 14, 2019, we repurchased

874,475 shares, utilizing a total of $30.8 million of the $600.0 million authorized by the Board.

Contractual Obligations

Our contractual obligations as of August 31, 2019 are summarized below.

As disclosed below, while we have certain non-cancelable purchase order obligations for property, plant and equipment, we generally do not enter into non-cancelable purchase orders for materials until we receive a

corresponding purchase commitment from our customer.

Non-cancelable purchase orders do not typically extend beyond the normal lead time of several weeks, at most.

Purchase orders beyond this time frame are

typically cancelable.

Payments due by period (in thousands)

Notes payable and long-term debt

Future interest on notes payable and long-term

Operating lease obligations

Capital lease obligations

Non-cancelable purchase order obligations (2)

Pension and postretirement contributions and

Total contractual obligations (5)

Consists of interest on notes payable and long-term debt outstanding as of August 31, 2019.

Certain of our

notes payable and long-term debt pay interest at variable rates.

We have applied estimated interest rates to determine the value of these expected future interest payments.

Consists of purchase commitments entered into as of August 31, 2019 primarily for property, plant and

equipment and software pursuant to legally enforceable and binding agreements.

Includes the estimated company contributions to funded pension plans during fiscal year 2020 and the expected

benefit payments for unfunded pension and postretirement plans from fiscal years 2020 through 2029.

These future payments are not recorded on the Consolidated Balance Sheets but will be recorded as incurred.

Includes (i) a $28.5 million capital commitment, (ii) a $16.2 million obligation related to

a new human resource system and (iii) $33.0 million related to the one-time transition tax as a result of the Tax Act that will be paid in annual installments through fiscal year 2026.

As of August 31, 2019, we have $1.5 million and $103.7 million recorded as a current and a

long-term liability, respectively, for uncertain tax positions.

We are not able to reasonably estimate the timing of payments, or the amount by which our liability for these uncertain tax positions will increase or decrease over time, and

accordingly, this liability has been excluded from the above table.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity