UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): April 28, 2014
CTS CORPORATION
(Exact Name of Registrant as Specified in Charter)
Indiana |
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1-4639 |
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35-0225010 |
(State or Other Jurisdiction of |
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(Commission File |
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(I.R.S. Employer Identification No.) |
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905 West Boulevard North |
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Elkhart, Indiana |
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46514 |
(Address of Principal Executive Offices) |
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(Zip Code) |
Registrants telephone number, including area code: (574) 523-3800
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition.
On April 28, 2014, CTS Corporation (the Registrant) issued a press release providing certain results for the quarterly period ended March 31, 2014 as more fully described in the press release. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.
The information contained in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, is being furnished to the Securities and Exchange Commission and shall not be deemed to be filed for the purposes of Section 18 of the Securities Exchange Act of 1934 (the Exchange Act) or otherwise subject to the liabilities of that section. Furthermore, the information contained in Item 2.02 of this Current Report on Form 8-K shall not be deemed to be incorporated by reference into any filing made by the Registrant under the Securities Act of 1933 or the Exchange Act, except as set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. |
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Exhibit Description |
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99.1 |
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Press Release dated April 28, 2014. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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CTS CORPORATION | |
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By: |
/s/ Robert J. Patton |
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Name: |
Robert J. Patton |
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Title: |
Vice President, General Counsel and Secretary |
Date: April 29, 2014
Exhibit 99.1
newsrelease
CTS CORPORATION Elkhart, Indiana 46514 · 574-523-3800
April 28, 2014
FOR RELEASE: Immediately
CTS ANNOUNCES FIRST QUARTER 2014 RESULTS
Progress on Track with Transition Plan
Elkhart, IN. . .CTS Corporation (NYSE: CTS) today announced first quarter 2014 results:
· Revenues of $100.7 million, an increase of 2.7% compared to first quarter of 2013.
· GAAP earnings from continuing operations of $5.1 million, or $0.15 per diluted share, compared to $3.0 million, or $0.09 per diluted share, in the first quarter of 2013. Adjusted EPS from continuing operations was $0.19 compared to $0.11 in the first quarter of 2013.
In the first quarter, sensors and mechatronics product sales grew 6%. Electronic components sales declined 4% due to softness in sales of engineered frequency and HDD products. The Company received $136 million of new business wins in the first quarter.
We continued to make progress with our transition plan moving from 2013 into 2014. The first quarter 2014 results are in line with our expectations and reflect our progress, said Kieran OSullivan, President and CEO of CTS Corporation. We saw softness in our electronic components portfolio and are taking steps to address this. At the same time, we are moving forward with our plans to strengthen our core business. We are enhancing our sales and engineering capabilities by adding resources closer to our target customers and upgrading competencies and talent in key areas, continued Mr. OSullivan.
CTS is maintaining its earlier guidance and anticipates full-year 2014 sales to grow in the range of 4% to 6% over 2013 and adjusted diluted earnings per share to be in the range of $0.96 to $1.02. Earnings for 2014 are expected to show gradual improvement during the year, with an expectation of a stronger second half.
Conference Call
As previously announced, the Company has scheduled a conference call on Tuesday, April 29, 2014 at 11:00 a.m. EDT. The dial-in number for the conference call is 888-539-3678 (719-325-2491, if calling from outside the U.S.). The conference I.D. number is 3379961. There will be a replay of the conference call from 3:00 p.m. (EDT) on Tuesday, April 29, 2014 through 3:00 p.m. (EDT) on Tuesday, May 6, 2014. The telephone number for the replay is 888-203-1112 (719-457-0820, if calling from outside the U.S.). The access code is 3379961. Also, please note that a live audio webcast of the conference call will be available and can be accessed directly from the website of CTS Corporation www.ctscorp.com.
About CTS
CTS is a leading designer and manufacturer of electronic components and sensors to OEMs in the automotive, communications, medical, defense and aerospace, industrial and computer markets. CTS manufactures products in North America, Europe and Asia. CTS stock is traded on the NYSE under the ticker symbol CTS.
Safe Harbor
This document contains statements that are, or may be deemed to be, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, any financial or other guidance, statements that reflect our current expectations concerning future results and events, and any other statements that are not based solely on historical fact. Forward-looking statements are based on managements expectations, certain assumptions and currently available information. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof and are based on various assumptions as to future events, the occurrence of which necessarily are subject to uncertainties. These forward-looking statements are made subject to certain risks, uncertainties and other factors, which could cause our actual results, performance or achievements to differ materially from those presented in the forward-looking statements. Examples of factors that may affect future operating results and financial condition include, but are not limited to: changes in the economy generally and in respect to the businesses in which CTS operates; unanticipated issues in integrating acquisitions; the results of actions to reposition our businesses; rapid technological change; general market conditions in the automotive, communications, and computer industries, as well as conditions in the industrial, defense and aerospace, and medical markets; reliance on key customers; unanticipated natural disasters or other events; the ability to protect our intellectual property; pricing pressures and demand for our products; and risks associated with our international operations, including trade and tariff barriers, exchange rates and political and geopolitical risks. Many of these, and other, risks and uncertainties are discussed in further detail in Item 1A. of the Annual Report on Form 10-K. We undertake no obligation to publicly update our forward-looking statements to reflect new information or events or circumstances that arise after the date hereof, including market or industry changes.
Contact: |
Ashish Agrawal, Vice President and Chief Financial Officer |
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CTS Corporation, 905 West Boulevard North, Elkhart, IN 46514 |
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Telephone 574-523-3800 |
CTS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED
(In thousands, except per share amounts)
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Three Months Ended |
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March 30, |
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March 31, |
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2014 |
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2013 |
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Net sales |
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$ |
100,706 |
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$ |
98,062 |
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Costs and expenses: |
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Cost of goods sold |
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70,091 |
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71,276 |
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Selling, general and administrative expenses |
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13,641 |
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17,676 |
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Research and development expenses |
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5,626 |
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6,252 |
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Restructuring charge |
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503 |
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177 |
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Operating earnings |
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10,845 |
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2,681 |
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Other expense: |
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Interest expense, net |
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(49 |
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(493 |
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Other income |
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(1,771 |
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(507 |
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Total other expense |
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(1,820 |
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(1,000 |
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Earnings before income taxes |
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9,025 |
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1,681 |
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Income tax expense |
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3,945 |
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(1,306 |
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Earnings from continuing operations |
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5,080 |
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2,987 |
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Earnings from discontinued operations, net of tax |
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581 |
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Net earnings |
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$ |
5,080 |
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$ |
3,568 |
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Net earnings per share: |
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Basic |
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Continuing operations |
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$ |
0.15 |
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$ |
0.09 |
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Discontinued operations |
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0.02 |
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Net earnings attributable to CTS Corporation |
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$ |
0.15 |
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$ |
0.11 |
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Diluted |
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Continuing operations |
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$ |
0.15 |
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$ |
0.09 |
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Discontinued operations |
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0.01 |
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Net earnings attributable to CTS Corporation |
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$ |
0.15 |
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$ |
0.10 |
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Cash dividends declared per share |
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$ |
0.040 |
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$ |
0.035 |
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Average common shares outstanding: |
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Basic |
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33,708 |
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33,523 |
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Diluted |
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34,280 |
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34,176 |
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CTS CORPORATION AND SUBSIDIARIES
OTHER SUPPLEMENTAL INFORMATION
Earnings per Share
The following table reconciles GAAP earnings per share to adjusted earnings per share for the Company:
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Three Months Ended |
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March 30, |
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March 31, |
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2014 |
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2013 |
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GAAP earnings per share |
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$ |
0.15 |
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$ |
0.10 |
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Discontinued operations |
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(0.01 |
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Earnings per share from continuing operations |
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$ |
0.15 |
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$ |
0.09 |
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Tax affected charges to reported diluted earnings per share: |
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Restructuring and related charges |
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0.02 |
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0.01 |
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CEO transition costs |
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0.01 |
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Tax asset write-off related to restructuring |
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0.02 |
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Adjusted earnings per share from continuing operations |
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$ |
0.19 |
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$ |
0.11 |
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Additional Information
The following table includes other financial information not presented in the preceding financial statements.
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Three Months Ended |
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$ In thousands |
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March 30, |
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March 31, |
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Expense |
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2014 |
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2013 |
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Depreciation and Amortization |
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$ |
4,248 |
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$ |
5,886 |
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Equity Based Compensation |
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$ |
779 |
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$ |
1,318 |
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OTHER SUPPLEMENTAL INFORMATION
(continued)
Non-GAAP Financial Measures
Adjusted earnings per share is a non-GAAP financial measure. The most directly comparable GAAP financial measure is diluted earnings per share.
CTS adjusts for this item because they are discrete events which have a significant impact on comparable GAAP financial measures and could distort an evaluation of our normal operating performance.
CTS uses an adjusted earnings per share measure to evaluate overall performance, establish plans and perform strategic analysis. Using this measure avoids distortion in the evaluation of operating results by eliminating the impact of events which are not related to normal operating performance. Because this measure is based on the exclusion or inclusion of specific items, they may not be comparable to measures used by other companies which have similar titles. CTS management compensates for this limitation when performing peer comparisons by evaluating both GAAP and non-GAAP financial measures reported by peer companies. CTS believes that this measure is useful to its management, investors and stakeholders in that it:
· provides a truer measure of CTS operating performance,
· reflects the results used by management in making decisions about the business, and
· helps review and project CTS performance over time.
We recommend that investors consider both actual and adjusted measures in evaluating the performance of CTS with peer companies.
CTS Corporation and Subsidiaries
Condensed Consolidated Balance Sheets - Unaudited
(In thousands of dollars)
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March 30, |
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December 31, |
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2014 |
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2013 |
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Cash and cash equivalents |
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$ |
118,969 |
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$ |
124,368 |
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Accounts receivable, net |
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67,875 |
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62,667 |
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Inventories |
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26,950 |
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32,226 |
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Other current assets |
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17,739 |
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17,008 |
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Total current assets |
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231,533 |
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236,269 |
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Property, plant & equipment, net |
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74,441 |
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74,869 |
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Other assets |
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168,208 |
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169,127 |
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Total Assets |
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$ |
474,182 |
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$ |
480,265 |
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Notes payable and current portion of long-term debt |
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$ |
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$ |
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Accounts payable |
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43,939 |
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47,052 |
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Accrued liabilities |
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39,245 |
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48,068 |
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Total current liabilities |
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83,184 |
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95,120 |
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Long-term debt |
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76,600 |
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75,000 |
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Other obligations |
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12,688 |
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13,416 |
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Shareholders equity |
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301,710 |
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296,729 |
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Total Liabilities and Shareholders Equity |
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$ |
474,182 |
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$ |
480,265 |
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