The ratings on San Jose, Calif.-based Sanmina-SCI Corp. reflect subpar operating performance, low capacity utilization, and volatile end-market demand, particularly in communications and computing end-markets. These concerns are partially offset by the company's top-tier business position, a somewhat diversified customer base of leading original equipment manufacturers (OEMs), and longer-term trends favoring electronic manufacturing outsourcing. Sanmina-SCI is a leading provider of electronic manufacturing services for the computing, telecommunications, and data communications industries. The company had about $2 billion in lease-adjusted total debt as of December 2003. Manufacturing overcapacity arising from a severe and prolonged industry downturn has caused capacity utilization to remain around 50%, well below desired levels, and to continue to pressure credit measures. This downturn has been particularly pronounced
