News Release

BANGKOK, May 02, 2011 (BUSINESS WIRE) -- Fabrinet (NYSE: FN), a provider of precision optical, electro-mechanical and electronic manufacturing services to original equipment manufacturers of complex products, today announced its financial results for the third quarter of fiscal 2011, ended March 25, 2011.

Fabrinet reported total revenue of $194.9 million for the third quarter of fiscal 2011, an increase of 42% compared to revenue of $136.9 million for the comparable period in fiscal 2010. GAAP net income in the third quarter was $16.7 million, or $0.49 per diluted share, an increase of 23% compared to GAAP net income of $13.5 million, or $0.43 per diluted share in the third quarter of 2010. Non-GAAP net income in the third quarter was $19 million, or $0.55 per diluted share, an increase of 38% compared to non-GAAP net income of 13.7 million, or $0.44 per share in the third quarter of 2010.

Tom Mitchell, Chief Executive Officer of Fabrinet, said, "We are pleased to have achieved record revenues and earnings in the third quarter, as well as our 45^th consecutive quarter of profitability. We saw strength across all product areas and business segments, with solid growth from the optical communications as well as lasers and sensor segments. Amid industry challenges, our results remain consistent and strong with revenue and earnings performance above expectations."

Business Outlook

Based on information available as of May 2, 2011, Fabrinet is issuing guidance for the fourth quarter of fiscal 2011 as follows:

The Company expects fourth quarter revenue to be in the range of $173 million to $178 million. GAAP net income per share is expected to be in the range of $0.44 to $0.46 with expected non-GAAP net income per share of $0.46 to $0.48, based on approximately 34.5 million fully diluted, weighted average shares outstanding.

Conference Call Information
What:		Fabrinet third quarter 2011 financial results conference call
When:		Monday, May 2, 2011
Time:		5:00 p.m. ET
Live Call:		(866) 356-3095, domestic
		(617) 597-5391, international
		Passcode 74084656
Replay:		(888) 286-8010, domestic
		(617) 801-6888, international
		Passcode 73187621
Webcast:		investor.fabrinet.com (live and replay)

This press release and any other information related to the call will also be posted on Fabrinet's website at investor.fabrinet.com. A recorded version of this webcast will be available approximately two hours after the call and will be archived on Fabrinet's website for a period of one year.

About Fabrinet

Fabrinet provides precision optical, electro-mechanical and electronic manufacturing services to original equipment manufacturers of complex products, such as optical communication components, modules and sub-systems, industrial lasers and sensors. Fabrinet offers a broad range of advanced optical and electro-mechanical capabilities across the entire manufacturing process, including process design and engineering, supply chain management, manufacturing, final assembly and test. Fabrinet focuses on production of high complexity products in any mix and any volume. Fabrinet maintains engineering and manufacturing resources and facilities in Thailand, the People's Republic of China and the United States. For more information visit: http://www.fabrinet.com.

Safe Harbor

"Safe Harbor" Statement Under U.S. Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include all of the statements under the "Business Outlook" section relating to our forecasted operating results for the fourth quarter of fiscal year 2011. These forward-looking statements involve risks and uncertainties, and actual results could vary materially from these forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: less customer demand for our products and services than forecasted; less growth in the optical communications, industrial lasers and sensors markets than we forecast; difficulties expanding into additional markets, such as the semiconductor processing, biotechnology, metrology and material processing markets; increasing competition in the optical manufacturing services markets; difficulties in delivering products and services that compete effectively from a price and performance perspective; our reliance on a limited number of customers and suppliers; difficulties in accurately forecasting demand for our services; difficulties in managing our operating costs; difficulties in managing and operating our business in multiple countries (including in the U.S., Thailand and the People's Republic of China) and other important factors as described in Fabrinet reports and documents filed from time to time with the Securities and Exchange Commission (SEC), including the factors described under the sections captioned "Risk Factors" in our quarterly report on Form 10-Q, filed on February 2, 2011 and our annual report on Form 10-K, filed on September 8, 2010. We disclaim any obligation to update information contained in these forward-looking statements whether as a result of new information, future events, or otherwise.

Use of Non-GAAP Financials

The Company refers to the non-GAAP financial measures cited above in making operating decisions because they provide meaningful supplemental information regarding the Company's ongoing operational performance. Non-GAAP net income excludes stock-based compensation expenses, executive separation costs and our costs in connection with our recent follow-on offering. We have excluded these items in order to enhance investors' understanding of our ongoing operations. The use of these non-GAAP financial measures has material limitations because they should not be used to evaluate our company without reference to their corresponding GAAP financial measures. As such, we compensate for these material limitations by using these non-GAAP financial measures in conjunction with GAAP financial measures.

These non-GAAP financial measures are used to: (1) measure company performance against historical results, (2) facilitate comparisons to our competitors' operating results, and (3) allow greater transparency with respect to information used by management in financial and operational decision making. In addition, these non-GAAP financial measures are used to measure company performance for the purposes of determining employee incentive plan compensation.

Fabrinet
Unaudited Condensed Consolidated Balance Sheets
As of March 25, 2011 and June 25, 2010
(in thousands of U.S. dollars, except share data)		March 25, 2011			June 25, 2010
Assets
Current assets
Cash and cash equivalents	$	116,419		$	84,942
Receivable from initial public offering		-			26,319
Trade accounts receivable, net		121,085			101,514
Inventories, net		108,052			98,146
Investment in leases		243			12
Deferred income taxes		758			696
Deposit for land purchase		-			2,162
Prepaid expenses and other current assets		2,775			2,535
Total current assets		349,332			316,326
Non-current assets
Property, plant and equipment, net		72,402			57,651
Intangibles, net		1,009			1,220
Investment in leases		1,381			20
Deferred income taxes		1,981			1,626
Deposits and other non-current assets		626			582
Total non-current assets		77,399			61,099
Total assets	$	426,731		$	377,425
Liabilities and Shareholders' Equity
Current liabilities
Long-term loans from banks, current portion	$	4,968		$	6,008
Trade accounts payable		97,066			102,977
Construction payable		511			-
Income tax payable		3,628			2,521
Accrued payroll, profit sharing and related expenses		8,024			3,895
Accrued expenses		4,057			3,567
Other payables		7,446			5,935
Total current liabilities		125,700			124,903
Non-current liabilities
Long-term loans from banks, non-current portion		10,996			14,377
Severance liabilities		4,234			3,456
Other non-current liabilities		1,941			2,526
Total non-current liabilities		17,171			20,359
Total liabilities		142,871			145,262
Commitments and contingencies
Shareholders' equity
Preferred shares (5,000,000 shares authorized, $0.01 par value;
no shares issued and outstanding as of March 25, 2011 and June 25, 2010, respectively)		-			-
Ordinary shares (500,000,000 shares authorized, $0.01 par value;
34,179,327 shares and 33,751,730 shares issued and
outstanding as of March 25, 2011 and June 25, 2010, respectively)		342			337
Additional paid-in capital		58,804			54,786
Accumulated other comprehensive loss		-			-
Retained earnings		224,714			177,040
Total shareholders' equity		283,860			232,163
Total Liabilities and Shareholders' Equity	$	426,731		$	377,425

Fabrinet
Unaudited Condensed Consolidated Statements of Operations
For the three and nine months ended March 25, 2011 and March 26, 2010
				Three Months Ended							Nine Months Ended
				March 25,			March 26,				March 25,			March 26,
(in thousands of U.S. dollars)				2011			2010				2011			2010
Revenues
	Revenues		$	194,851		$	114,406			$	553,222		$	296,543
	Revenues, related party			-			22,484				-			51,758
Total revenues				194,851			136,890				553,222			348,301
Cost of revenues				(169,528)			(117,761)				(482,460)			(303,339)
	Gross profit			25,323			19,129				70,762			44,962
Selling, general and administrative expenses				(7,516)			(4,356)				(18,294)			(11,965)
Operating income				17,807			14,773				52,468			32,997
Interest income				143			62				355			254
Interest expense				(81)			(108)				(282)			(397)
Foreign exchange gain/(loss), net				342			(97)				(706)			(131)
Other income				65			-				80			-
Income before income taxes				18,276			14,630				51,915			32,723
Income taxes				(1,613)			(1,119)				(4,241)			(1,974)
Net income			$	16,663		$	13,511			$	47,674		$	30,749
Earnings per share
	Basic		$	0.49		$	0.44			$	1.41		$	1.00
	Diluted		$	0.49		$	0.43			$	1.39		$	0.98
Weighted average number of ordinary shares outstanding
	(thousands of shares)
	Basic			33,969			30,901				33,833			30,821
	Diluted			34,232			31,365				34,345			31,340

						Fabrinet
						Reconciliation of GAAP measures to non-GAAP measures
						(in thousands of U.S. dollars, except per share data)
						(unaudited)
						Three Months Ended									Nine Months Ended
						March 25,		March 25,		March 26,		March 26,			March 25,		March 25,		March 26,		March 26,
						2011		2011		2010		2010			2011		2011		2010		2010
						Net income		Diluted EPS		Net income		Diluted EPS			Net income		Diluted EPS		Net income		Diluted EPS
GAAP measures						16,663		0.49		13,511		0.43			47,674		1.39		30,749		0.98
			Items reconciling GAAP net income & EPS to non-GAAP net income & EPS:
			Related to cost of revenues:
				Share-based compensation expenses		440		0.01		79		0.00			918		0.03		227		0.01
			Total related to gross profit			440		0.01		79		0.00			918		0.03		227		0.01
			Related to selling, general and administrative expenses:
				Share-based compensation expenses		798		0.02		105		0.00			1,740		0.05		267		0.01
				Executive separation cost		438		0.01		-		-			438		0.01		-		-
				Follow-on offering expenses		617		0.02		-		-			617		0.02		-		-
			Total related to selling, general and administrative expenses			1,853		0.05		105		0.00			2,795		0.08		267		0.01
			Total related to net income & EPS			2,293		0.07		184		0.01			3,713		0.11		494		0.02
Non-GAAP measures						18,956		0.55		13,695		0.44			51,387		1.49		31,243		0.99
Shares used in computing diluted net income per share
			GAAP diluted shares					34,232				31,365					34,345				31,340
			Non-GAAP diluted shares					34,431				31,442					34,494				31,406

SOURCE: Fabrinet

Investor Contact:
ICR, Inc.
Abhi Kanitkar, 617-956-6735
ir@fabrinet.com
or
Media Contact:
Crowley Communications
Pam Crowley, 408-529-9655
pamc@crowleypr.com