In Q1 revenues of $506 million were above the midpoint of our guidance for the quarter led by continued global strength in our semi-cap sector, which grew 37% year-over-year.
Our non-GAAP gross margins of 8.3%, non-GAAP operating margins of 2.3% and earnings per share of $0.21 were all in line with our forecast guidance.
We had another strong quarter of working capital results as the cash conversion cycle was in 65 days, which enabled $37 million of operating cash flow and $30 million of free cash flow for the quarter.
Our pipeline continues to grow, and our trailing four quarter wins are over $800 million, which is a new record for our organization.
Total Benchmark revenue was $506 million in Q1, which was slightly above the midpoint of our guidance.
Semi-Cap revenues were up 12% in the first quarter and up 37% year-over-year from continued demand strength from our wafer fab equipment customers, who are continuing to boost capacity to support greater chip output.
A&D revenues for the first quarter decreased 19% sequentially from further deterioration in demand from our commercial aerospace customers, with no signs of demand recovery in the near future.
As a reminder, revenues to commercial aerospace customers was approximately 25% of our 2020 A&D sector revenue.
Overall, the higher value markets represented 80% for our first quarter revenue.
Our traditional markets represented 20% of first quarter revenues.
Our top 10 customers represented 44% of sales in the first quarter.
Our GAAP earnings per share for the quarter was $0.22.
Our GAAP results included restructuring and other one-time costs, totaling $1.6 million related to reductions in force and other restructuring activities around our network of sites, $3.4 million of insurance recovery.
For Q1, our non-GAAP gross margin was 8.3%.
This is 10 basis points better than the midpoint of our Q1 2021 guidance and 10 basis points less than our year-over-year comparison, which has stronger higher value market mix.
On a sequential basis, we were lower by 130 basis points, as a result of our lower revenue, reduced absorption, higher discrete medical claims activity and higher variable compensation.
Our SG&A was $30.5 million, a decrease of $1.9 million sequentially due to lower variable compensation costs.
Non-GAAP operating margin was 2.3%.
In Q1 2021, our non-GAAP effective tax rate was 16.9%, as a result of a mix of profits between the US and foreign jurisdictions, Non-GAAP earnings per share was $0.21 for the quarter, which is a $0.01 higher than the midpoint of our Q1 guidance and non-GAAP ROIC was 6.4%.
Our cash conversion cycle days were 65 in the first quarter, an improvement of six days from the fourth quarter from the timing of inventory receipts, shipments to customers and collections within the quarter.
Our cash balance was $400 million at March 31 with $153 million available in the US.
Our cash balances grew $4 million sequentially because of our strong cash conversion cycle performance, even while we have invested in inventory for future ramps.
We generated $37 million cash flow from operations in Q1 and our free cash flow was $30 million.
At March 31, we had $135 million outstanding on our term loan with no borrowings outstanding on our available revolver.
In Q1, we can pay cash dividends of $5.8 million and use $13.1 million to repurchase 441,600 shares.
As of March 31, we had approximately 191 million remaining in our existing share repurchase authorization.
We expect revenue to range from $515 million to $555 million, which at the midpoint, represents a 9% year-over-year improvement.
We expect that our gross margins will be 8.5% to 8.7% for Q2 and SG&A will range between $31 million and $32 million.
We still expect gross margins for the full year to be at least 9%.
Implied in our guidance is a 2.5% to 2.9% non-GAAP operating margin range for modeling purposes.
We expect to incur restructuring and other non-recurring costs in Q2 of approximately $0.8 million to $1.2 million.
Our non-GAAP diluted earnings per share is expected to be in the range of $0.23 to $0.29 for a midpoint of $0.26.
Based on the strength of new bookings, execution of new program ramps and continued growth in our Semi-Cap sector, we are increasing our capex plans for the year to be between $50 million to $60 million.
We estimate that we will generate approximately $80 million to $100 million of cash flow from operations for the fiscal year 2021.
Other expenses net is expected to be $2.5 million, which is primarily interest expense related to our outstanding debt.
We expect that for Q2, our non-GAAP effective tax rate will be between 19% and 21% because of the distribution of income around our global network.
The expected weighted average shares for Q2 are $36.5 million.
For the second quarter, we expect revenue to be up sequentially by about $30 million.
With this current demand strength and signals from our customers, we are revising our outlook for this sector upward from 10% growth to greater than 20% revenue growth over 2020 levels.
Growth is expected in Q2, even though demand for commercial aerospace programs, which was about 25% of the sector demand in 2020, continues to deteriorate.
This recognition puts us in the top 25% of companies rated.
To that point, in Q1, about 50% of our new wins have an engineering component.
Our differentiated offerings in support of the Semi-Cap market and our new program wins have enabled significant growth in the Semi-Cap vertical, which we expect will now grow over 20% this year.
This strength, coupled with new programs and high-performance computing in mid-2021 and additional new program ramps in the higher value markets, gives us confidence that we can achieve greater than 5% growth in 2021.
Even though we continue to invest in our business, we are committed to driving an efficient shared services organization and continuing our focus on expense management to maintain our SG&A spend at or below 6% of revenue.
With revenue growth from increasing demand in new ramps, we still expect to achieve 9% gross margin for the full year.
While we are still forecasting cash flows from operations for the full year between $80 million and $100 million.

Summary:
In Q1 revenues of $506 million were above the midpoint of our guidance for the quarter led by continued global strength in our semi-cap sector, which grew 37% year-over-year.
Our non-GAAP gross margins of 8.3%, non-GAAP operating margins of 2.3% and earnings per share of $0.21 were all in line with our forecast guidance.
Total Benchmark revenue was $506 million in Q1, which was slightly above the midpoint of our guidance.
Our GAAP earnings per share for the quarter was $0.22.
In Q1 2021, our non-GAAP effective tax rate was 16.9%, as a result of a mix of profits between the US and foreign jurisdictions, Non-GAAP earnings per share was $0.21 for the quarter, which is a $0.01 higher than the midpoint of our Q1 guidance and non-GAAP ROIC was 6.4%.
We expect revenue to range from $515 million to $555 million, which at the midpoint, represents a 9% year-over-year improvement.
Our non-GAAP diluted earnings per share is expected to be in the range of $0.23 to $0.29 for a midpoint of $0.26.