8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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): September 2, 2004

METHODE ELECTRONICS, INC.

(Exact name of registrant as specified in its charter)

Delaware
State of Other Jurisdiction
of Incorporation 0-2816
Commission File Number 36-2090085
I.R.S. Employer
Identification Number

7401 West Wilson Avenue, Chicago, Illinois 60706
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (708) 867-6777

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:

[    ]	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[    ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[    ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[    ]	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 September 2, 2004, Methode Electronics, Inc. issued a press release announcing its financial results for the fiscal year 2005 first quarter ended July 31, 2004. A copy of the press release is filed herewith as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01.    Financial Statements and Exhibits

(c)      Exhibits

99.1 Methode Electronics, Inc. Press Release dated September 2, 2004.

SIGNATURE

     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.

      

	METHODE ELECTRONICS, INC.
Date: September 2, 2004	By:	/s/ Douglas A. Koman
		Douglas A. Koman
		Chief Financial Officer

EX-99.1

Exhibit 99.1

News Release

For:	Methode Electronics, Inc.	Contact:	Joey Iske
	7401 West Wilson Avenue		Director of Investor Relations
	Chicago, IL 60706		708-457-4060
			jiske@methode.com

Methode Electronics, Inc. Reports First Quarter Fiscal Year 2005 Results

CHICAGO, September 2, 2004 — Methode Electronics, Inc. (Nasdaq: METH) today announced operating results for the fiscal year 2005 first quarter ended July 31, 2004.

Financial Summary

Methode reported first quarter fiscal year 2005 net sales of $85.0 million and net income of $4.6 million, or $0.13 per share. This compares with net sales of $78.0 million and net income of $4.3 million, or $0.12 per share, in the first quarter of fiscal year 2004.

As a percentage of net sales, cost of products sold was 79.7% in the first quarter of fiscal 2005, which was slightly lower than 80.6% in the first quarter of fiscal 2004. Selling and administrative expense represented 13.4% of net sales in the first quarter of fiscal 2005 compared to 11.7% in the first quarter of fiscal 2004. This increase is mainly due to Sarbanes-Oxley initiatives, greater research and development efforts, amortization of newly issued restricted stock awards and start-up costs for the Shanghai, China operation. Also contributing to this increase was the conversion of our Ireland facility from manufacturing to a sales and distribution operation.

In the first quarter, the compensation committee of Methode’s board of directors made important changes to the bonus compensation program for senior executives, moving it from a prior period income-based program to one that rewards achievement of specific performance criteria. Also in the first quarter, in lieu of stock options, the cost of which Methode has not previously recognized as compensation, the compensation committee granted restricted stock awards (RSAs). A portion of RSAs granted to senior executives is subject to forfeiture if specific performance criteria are not achieved. The compensation cost for the RSAs is amortized over the three-year vesting period with amortization beginning in the first quarter.

Commenting on the quarter, Donald W. Duda, President and Chief Executive Officer said, “The quarter came in as anticipated. Our automotive businesses had strong results due to expected increases at our Automotive Safety Technology unit and our European operations. We are pleased that our domestic Automotive Electronics Controls division held steady through the new model changeover period. We are closely monitoring production schedules as the traditional North American OEMs seek to find strength in their 2005 model sales.”

Methode’s combined North American and European automotive groups completed 22 new program launches in the months of June and July. The diverse program base included OEMs such as Audi, DaimlerChrysler, Ford, Hyundai, Jaguar, Land Rover, Mercedes, Nissan and Volvo.

Mr. Duda went on to say, “Our automotive groups have come a long way in the past few years in developing their launch management skills and expertise. They are holding their costs in line with program expectations, managing difficult commercial issues and improving supply chain management. We are pleased with their ability to manage this number of new program launches efficiently and effectively.”

Business Outlook

Methode expects to achieve second quarter fiscal 2005 sales between $95.0 million and $100.0 million and earnings per share in the range of $0.17 to $0.19. The Company is maintaining its previously announced sales guidance for fiscal year 2005 of between $370.0 million and $385.0 million. We are adjusting the high-end of our previously announced fiscal year 2005 earnings of between $0.65 and $0.72 to recognize the compensation cost of restricted stock awards granted in the first quarter. New guidance, with this adjustment, for our fiscal year 2005 earnings is between $0.65 and $0.70 per share.

Conference Call

As previously announced, the Company will conduct a conference call led by its President and Chief Executive Officer, Donald W. Duda, and Vice President, Corporate Finance and Chief Financial Officer, Douglas A. Koman, on September 2, 2004 at 10:00 a.m. Central Time. You may participate on the conference call by dialing 888-396-2386 for domestic callers and 617-847-8712 for international. Methode also invites you to listen to the webcast of this call by visiting the Company’s website at http://www.methode.com and entering the “Investor Relations” page and then clicking on the “Webcast” icon. A replay of the call will be available for seven days, by dialing 888-286-8010 for domestic callers and 617-801-6888 for international. Both will use the passcode: 89161135. The replay will also be available on the Company’s website.

About Methode Electronics

Methode Electronics, Inc. is a global manufacturer of component and subsystem devices. Methode designs, manufactures and markets devices employing electrical, electronic, wireless, sensing and optical technologies. Methode’s components are found in the primary end markets of the automotive, communications (including information processing and storage, networking equipment, wireless and terrestrial voice/data systems), aerospace, rail and other transportation industries; and the consumer and industrial equipment markets. Further information can be found at Methode’s website http://www.methode.com.

Forward-Looking Statements

Certain statements in this press release dated September 2, 2004, containing information on Methode’s first quarter reporting period for fiscal 2005, and offering guidance for its second quarter and full year reporting periods for fiscal 2005, are forward-looking statements that are subject to certain risks and uncertainties. The Company’s results will be subject to many of the same risks that apply to the automotive, computer and telecommunications industries, such as general economic conditions, interest rates, consumer spending patterns and technological change. Other factors, which may result in materially different results for future periods, include market growth; operating costs; currency exchange rates and devaluations; delays in development, production and marketing of new products; and other factors set forth from time to time in the Company’s Form 10-K and other reports filed with the Securities and Exchange Commission. The forward-looking statements in this press release are subject to the safe harbor protection provided under the securities law.

Methode Electronics, Inc.

Summary Statement of Income (Unaudited)

(In thousands, except per share data)

	Three Months Ended July 31,
	2004		2003
Net sales	$	85,021	$	77,957
Other income		655		620
Cost of products sold		67,781		62,799
Selling and administrative expenses		11,388		9,121
Income (loss) from operations		6,507		6,657
Interest, net		113		187
Other income (expense), net		37		(578	)
Income before income taxes		6,657		6,266
Income taxes		2,065		1,975
Net income		4,592		4,291
Basic and Diluted Earnings per Common Share:	$	0.13	$	0.12
Average Number of Common Shares outstanding:
Basic		35,500		36,106
Diluted		35,776		36,334

Summary Balance Sheet

(In thousands)

	July 31,		April 30,
	2004		2004
	(Unaudited)
Cash	$	65,970	$	61,757
Accounts receivable — net		58,139		65,360
Inventories		30,297		29,207
Other current assets		11,650		13,031
Total Current Assets		166,056		169,355
Property, plant and equipment — net		89,623		87,755
Goodwill — net		20,341		19,559
Intangible assets — net		23,311		24,266
Other assets		13,431		13,253
Total Assets	$	312,762	$	314,188
Accounts and notes payable	$	23,151	$	28,542
Other current liabilities		29,107		28,718
Total current liabilities		52,258		57,260
Other liabilities		8,097		8,344
Shareholders’ equity		252,407		248,584
Total Liabilities and Shareholders’ Equity	$	312,762	$	314,188

Summary Statement of Cash Flows (Unaudited)
(In thousands)

	Three Months Ended July 31,
	2004			2003
Operating Activities:
Net income	$	4,592		$	4,291
Provision for depreciation and amortization		5,280			4,880
Other		2,315			8,856
Net Cash Provided by Operating Activities		12,187			18,027
Investing Activities:
Purchases of property, plant and equipment		(5,799	)		(3,694	)
Acquisitions		(782	)		(1,253	)
Collection of note receivable from related party					6,000
Other		(503	)		(135	)
Net Provided by (Cash Used) in Investing Activities:		(7,084	)		918
Financing Activities
Purchase and retirement of Class B shares		—			(17,063	)
Options exercised		160			1,397
Dividends		(1,775	)		(1,819	)
Other		—			357
Net Cash Used in Financing Activities		(1,615	)		(17,128	)
Effect of foreign exchange rate changes on cash		725			18
Increase in Cash and Cash Equivalents		4,213			1,835
Cash and cash equivalents at beginning of period		61,757			64,261
Cash and Cash Equivalents at End of Period	$	65,970		$	66,096