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'THE BALDRIGE AWARD MAKES GOOD BUISNESS SENSE'; SOLECTRON'S REVENUES AND PROFITABILITY SET AN EXAMPLE FOR U.S. BUSINESS COMPETITIVENESS

'THE BALDRIGE AWARD MAKES GOOD BUISNESS SENSE'; SOLECTRON'S REVENUES
 AND PROFITABILITY SET AN EXAMPLE FOR U.S. BUSINESS COMPETITIVENESS
 MILPITAS, Calif., Oct. 23 /PRNewswire/ -- Solectron Corp. (NYSE: SLR), a 1991 Malcolm Baldrige National Quality Award winner, congratulates the five winners of the 1992 Baldrige Awards -- AT&T Network Systems Group, AT&T Universal Card Services, Granite Rock Co., Ritz-Carlton Hotel Co., and Texas Instruments Inc. Defense Systems and Electronics Group.
 Dr. Winston Chen, chairman of Solectron's board of directors, said, "We applaud these companies who have wholeheartedly committed to the quality process, as we believe this is one of the best paths that U.S. companies can take to compete globally. Our vision is that every business organization in the country apply for the award. This could increase our country's competitiveness tenfold."
 Solectron buttressed the assertion that the Baldrige process means good business by releasing data to demonstrate the close connection between the Baldrige Award and its own business success. Dr. Chen said, "A common question is, 'Does the Baldrige Award pay?' By this they mean, is it worthwhile to apply? Our answer is, absolutely!"
 Chen said that when the company first applied for the Baldrige Award, it was with the clear intent of using the process as a better business roadmap. "Four years later, we continue to be gratified by the results," he said. "The Baldrige process has been instrumental in our growth and ability to compete globally."
 Chen detailed the company's financial performance, indicators of business success, including revenues, profitability, earnings per share, shareholder value and job creation. "The Baldrige process helped us measure and improve key quality indicators. Faithful execution of these indicators has helped improve our business. If we can do it, everyone can."
 Revenues: Sales have risen almost fourfold in the last four years, from $130 million to $407 million, for the fiscal year ending Aug. 31, 1992. Over this period, the company reports annual compounded sales growth rates of 46 percent.
 Profitability: Profits before taxes have grown steadily over the last four years, from $7.6 million in 1989 to $24.1 million in 1992. This represented an annual growth of 47 percent consistent with revenues. Net income for the last four years grew from $4.3 to $14.5 million and represents annual growth of 50 percent.
 Earnings per share: Since the company began its commitment to the Baldrige process, the annual EPS figures have almost doubled from 46 cents per share to 88 cents. This represents an annual growth of 24 percent over the period.
 Shareholder value has jumped during this period from $19 million to $412 million, an annual compounded growth of 175 percent.
 Job creation: Over the last four years company jobs have increased from 1,500 to over 3,700 today.
 Other key indicators: In the same period, the company's customer satisfaction index grew to 93 percent, and customer quality and service awards jumped from 14 to 43. Test yields have grown from 90 percent to 96 percent, while the final inspection defect rate has dropped by half, from 150 parts per million (ppm) to 75 ppm. Manufacturing rework cost, another key quality and profitability issue, dropped as a percentage of revenue from 0.99 percent to 0.34 percent.
 Chen believes that these results are achievable by any electronics manufacturer willing to make a total commitment to quality. "U.S. companies should begin the Baldrige process now. There's no 'getting already,' there's only 'doing it,' which can lead to better business performance.
 "We recommend that all U.S. companies apply immediately," says Chen.
 Solectron Corp., founded in 1977, provides manufacturing services that primarily involve the assembly of electronics systems and subsystems using surface mount technology (SMT), pin-through-hole design, prototype, materials management, software manufacturing, packaging, remanufacturing and test services. Solectron received the 1991 Malcolm Baldrige National Quality Award, and has accumulated a total of 43 quality and superior service awards from customers such as Apple Computer, Applied Materials, Conner Peripherals, Exabyte, Hewlett- Packard, IBM, and Sun Microsystems.
 The company's worldwide headquarters is located at 777 Gibraltar Dr., Milpitas, CA 95035. The company currently operates additional manufacturing facilities in Charlotte, N.C.; Bordeaux, France; and Penang, Malaysia. The company recently opened a program office in Japan.
 -0- 10/23/92
 /CONTACT: Winston Chen of Solectron, 408-956-6777, or Mike Peak of Peak Public Relations, 408-446-0407, for Solectron/
 (SLR) CO: Solectron Corp. ST: California IN: CPR SU:


SG-TM -- SJ003 -- 3964 10/23/92 07:25 EDT
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Date:Oct 23, 1992
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