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) October 17, 2012
AMPHENOL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware |
|
1-10879 |
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22-2785165 |
(State or other jurisdiction of incorporation) |
|
(Commission File Number) |
|
(IRS Employer Identification No.) |
358 Hall Avenue, Wallingford, Connecticut |
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06492 |
(Address of principal executive offices) |
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(Zip Code) |
Registrants telephone number, including area code (203) 265-8900
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:
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 October 17, 2012, Amphenol Corporation issued a press release setting forth the Companys 2012 third quarter earnings. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.
Statements in this Form 8-K which are other than historical facts are intended to be forward-looking statements within the meaning of the Securities Exchange Act of 1934, the Private Securities Litigation Reform Act of 1995 and other related laws. While the Company believes such statements are reasonable, the actual results and effects could differ materially from those currently anticipated. Please refer to Part I, Item 1A of the Companys Form 10-K for the year ended December 31, 2011, for some factors that could cause the actual results to differ from estimates. In providing forward-looking statements, the Company is not undertaking any duty or obligation to update these statements publicly as a result of new information, future events or otherwise.
Item 9.01 Financial Statements and Exhibits.
Exhibit 99.1 Press Release dated October 17, 2012
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 thereunto duly authorized.
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AMPHENOL CORPORATION |
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By: |
/s/ Diana G. Reardon |
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Diana G. Reardon |
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Executive Vice President |
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and Chief Financial Officer |
Date: October 17, 2012
EXHIBIT 99.1
Amphenol |
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News Release |
World Headquarters
358 Hall Avenue
P. O. Box 5030
Wallingford, CT 06492-7530
Telephone (203) 265-8900
FOR IMMEDIATE RELEASE
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For Further Information: |
|
Diana G. Reardon |
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Executive Vice President and |
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Chief Financial Officer |
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203/265-8630 |
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www.amphenol.com |
THIRD QUARTER 2012 RECORD RESULTS
REPORTED BY AMPHENOL CORPORATION
Wallingford Connecticut, October 17, 2012. Amphenol Corporation (NYSE-APH) reported today third quarter 2012 record diluted earnings per share of $.90 compared to $.79 per share for the comparable 2011 period. Such per share amount for the 2011 quarter includes the effect of a $13 million ($8 million after tax), or $.05 per share one-time charge relating to flood damage at the Companys Sidney, New York facility and a $4 million, or $.03 per share, net benefit relating to a reduction in tax expense due primarily to the completion of prior year audits. Excluding these effects, diluted earnings per share was $.81 for the 2011 period. Sales for the third quarter 2012 were a record $1.103 billion compared to $1.033 billion for the 2011 period. Currency translation had the effect of decreasing sales by approximately $19 million in the third quarter 2012 compared to the 2011 period.
For the nine months ended September 30, 2012, diluted earnings per share were $2.53 compared to $2.36 for the 2011 period on an as reported basis and $2.32 for the 2011 period excluding one-time items. One-time items in the 2011 period of $.04 include the $.02 net third quarter charge described above and a $.06 per share gain related to the adjustment of a contingent purchase price obligation for a 2010 acquisition. Sales for the nine months ended September 30, 2012 were $3.146 billion compared to $2.991 billion for the 2011 period. Currency translation had the effect of decreasing sales by approximately $42 million for the nine month 2012 period compared to the 2011 period.
Amphenol President and Chief Executive Officer, R. Adam Norwitt, stated We are pleased to report new records of performance in the third quarter of 2012 with sales and EPS of $1.103 billion and $.90, respectively. Sales increased by approximately 7% year-over-year and 4% sequentially. On a year-over-year basis, we experienced strength in the automotive, industrial, commercial aerospace and telecommunications and data communications equipment markets. On a sequential basis the Company saw strong growth in mobile devices primarily related to ramp ups of new mobile computing devices. Our strong growth is once again confirmation of the significant benefits of the Companys diversity, especially given the increasing level of uncertainty in many of the worlds economies.
In addition, it is extremely rewarding that the Companys unique entrepreneurial culture continues to drive an unwavering focus on profitability and cash flow, resulting in another sequential operating margin improvement to 19.5% and strong operating cash flow in the quarter of $176 million. I am very proud of our organization as we continue to execute well.
Our ongoing strategy of market and geographic diversification combined with our strong commitment to developing enabling technologies for our customers in all markets, both through organic product development and through our acquisition program, continues to expand the Companys growth opportunities. Consistent with this strategy, in the third quarter, the Company completed the acquisitions of Holland Electronics, a leading U.S. supplier of interconnect products for the broadband and satellite communications markets with annual sales of approximately $60 million, and Griffith Enterprises, a U.S. manufacturer of high-technology, value-added assemblies, primarily for commercial aerospace applications, with annual sales of approximately $15 million. These acquisitions significantly enhance the Companys product portfolio in two important end markets providing new highly-engineered interconnect solutions to complement our broadband cable offering and expanding our value-add solutions for the fast growing commercial air market. In addition to our successful acquisition program, the Company continues to deploy its financial strength in a variety of other ways to increase shareholder value. These include the purchase in this quarter of .5 million shares of the Companys stock pursuant to our stock repurchase plan as well as the previously announced increase in the quarterly dividend to $.105 per share effective for dividends paid after March 2012.
In recent months there has been an increasing level of market uncertainty related to a range of fiscal and budgetary issues. Based on these considerations and assuming current currency exchange rates we expect fourth quarter 2012 revenues in the range of $1.095 billion to $1.115 billion and diluted EPS in the range of $.88 to $.91 For the full year 2012, we now expect to achieve revenues and diluted EPS in the range of $4.241 billion to $4.261 billion and $3.41 to $3.44, respectively, an increase in revenues of 8% and in diluted EPS (excluding one-time items), of 12% to 13% over 2011. This compares to prior full year 2012 guidance for revenues and diluted EPS in the range of $4.210 billion to $4.250 billion and $3.38 to $3.44, respectively. Despite the many uncertainties in the global marketplace, we believe we can perform well in the dynamic electronics market due to our leading technology, increasing positions with our customers in diverse markets, worldwide presence, lean cost structure, and agile, experienced and entrepreneurial management team.
The electronics revolution continues to accelerate, with new applications and higher performance requirements driving increased demand for our leading interconnect technologies in all of our end markets. This creates a significant, long-term growth opportunity for Amphenol. Importantly, our ongoing actions to enhance our competitive advantages and build sustained financial strength have created a solid base for future performance. I am confident in the ability of our outstanding management team to dynamically adjust to a constantly changing market environment, to continue to generate strong profitability and to further capitalize on the many opportunities to expand our market position.
The Company will host a conference call to discuss its third quarter results at 1:00 PM (EST) October 17, 2012. The toll free dial-in number to participate in this call is 888-395-9624; International dial-in number is 517-623-4547; Passcode: Reardon. There will be a replay available until 11:59 P.M. (EST) on Friday, October 19, 2012. The replay numbers are toll free 800-839-2290; International toll number is 203-369-3607; Passcode: 5137.
A live broadcast as well as a replay will also be available on the Internet at http://www.amphenol.com/investors/webcasts.php.
Amphenol Corporation is one of the worlds leading producers of electronic and fiber optic connectors, cable and interconnect systems. Amphenol products are engineered and manufactured in the Americas, Europe, Asia and Africa and sold by a worldwide sales and marketing organization. Amphenol has a diversified presence as a leader in high growth areas of the interconnect market including: Military, Commercial Aerospace, Automotive, Broadband Communications, Industrial, Telecommunications and Data Communications, Wireless Devices and Wireless Infrastructure.
Statements in this press release which are other than historical facts are intended to be forward-looking statements within the meaning of the Securities Exchange Act of 1934, the Private Securities Litigation Reform Act of 1995 and other related laws. While the Company believes such statements are reasonable, the actual results and effects could differ materially from those currently anticipated. Please refer to [Part I, Item 1A] of the Companys Form 10-K for the year ended December 31, 2011, for some factors that could cause the actual results to differ from estimates. In providing forward-looking statements, the Company is not undertaking any duty or obligation to update these statements publicly as a result of new information, future events or otherwise.
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(dollars in thousands, except per share data)
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Three Months Ended |
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Nine Months Ended |
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September 30, |
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September 30, |
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2012 |
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2011 |
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2012 |
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2011 |
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Net sales |
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$ |
1,103,376 |
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$ |
1,032,754 |
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$ |
3,146,087 |
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$ |
2,991,077 |
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| ||||
Cost of sales |
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759,047 |
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709,277 |
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2,158,326 |
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2,042,254 |
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Gross profit |
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344,329 |
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323,477 |
|
987,761 |
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948,823 |
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|
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Casualty loss related to flood |
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12,831 |
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12,831 |
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| ||||
Change in contingent acquisition related obligations |
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|
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(17,813 |
) | ||||
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Selling, general and administrative expense |
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128,659 |
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124,587 |
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380,636 |
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366,787 |
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Operating income |
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215,670 |
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186,059 |
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607,125 |
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587,018 |
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Interest expense |
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(15,166 |
) |
(10,498 |
) |
(44,014 |
) |
(31,885 |
) | ||||
Other income, net |
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2,636 |
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2,255 |
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7,457 |
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6,089 |
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|
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Income before income taxes |
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203,140 |
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177,816 |
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570,568 |
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561,222 |
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Provision for income taxes |
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(54,340 |
) |
(41,758 |
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(152,627 |
) |
(147,385 |
) | ||||
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Net income |
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148,800 |
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136,058 |
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417,941 |
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413,837 |
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Less: Net income attributable to noncontrolling interests |
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(1,350 |
) |
(1,435 |
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(2,986 |
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(3,505 |
) | ||||
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Net income attributable to Amphenol Corporation |
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$ |
147,450 |
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$ |
134,623 |
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$ |
414,955 |
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$ |
410,332 |
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Net income per common share - Basic |
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$ |
0.91 |
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$ |
0.80 |
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$ |
2.56 |
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$ |
2.39 |
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Weighted average common shares outstanding - Basic |
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161,349,493 |
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167,951,866 |
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161,905,598 |
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171,411,779 |
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Net income per common share - Diluted (1) |
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$ |
0.90 |
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$ |
0.79 |
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$ |
2.53 |
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$ |
2.36 |
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|
|
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|
| ||||
Weighted average common shares outstanding - Diluted |
|
163,780,171 |
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169,835,067 |
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164,333,598 |
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173,728,409 |
| ||||
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Dividends declared per common share |
|
$ |
0.105 |
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$ |
0.015 |
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$ |
0.315 |
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$ |
0.045 |
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Note 1 |
|
Earnings per share for the third quarter of 2011 includes a $12.8 million charge ($8.1 million after tax), or ($.05) per share, casualty loss related to flood and a $4.5 million, or $.03 per share, net tax benefit relating to a reduction in international tax expense due primarily to the favorable settlement of certain tax positions and the completion of prior year audits. Earnings per share for the nine months ended September 30, 2011 also includes a $17.8 million ($11.2 million after tax) gain, or $.06 per share, related to the adjustment of a contingent purchase price obligation for a 2010 acquisition. Excluding these effects, diluted earnings per share was $.81 and $2.32 for the three months and nine months ended September 30, 2011, respectively. |
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(dollars in thousands)
|
|
September 30, |
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December 31, |
| ||
|
|
2012 |
|
2011 |
| ||
ASSETS |
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Current Assets: |
|
|
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| ||
Cash and cash equivalents |
|
$ |
725,546 |
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$ |
515,086 |
|
Short-term investments |
|
167,345 |
|
133,848 |
| ||
Total cash, cash equivalents and short-term investments |
|
892,891 |
|
648,934 |
| ||
Accounts receivable, less allowance for doubtful accounts of $11,085 and $11,113, respectively |
|
903,344 |
|
767,181 |
| ||
Inventories, net |
|
712,189 |
|
649,862 |
| ||
Other current assets |
|
132,557 |
|
115,260 |
| ||
|
|
|
|
|
| ||
Total current assets |
|
2,640,981 |
|
2,181,237 |
| ||
|
|
|
|
|
| ||
Land and depreciable assets, less accumulated depreciation of $701,032 and $655,869, respectively |
|
407,587 |
|
380,501 |
| ||
Goodwill |
|
1,876,539 |
|
1,746,113 |
| ||
Other long-term assets |
|
145,858 |
|
137,374 |
| ||
|
|
|
|
|
| ||
|
|
$ |
5,070,965 |
|
$ |
4,445,225 |
|
|
|
|
|
|
| ||
LIABILITIES & EQUITY |
|
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| ||
|
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Current Liabilities: |
|
|
|
|
| ||
Accounts payable |
|
$ |
478,100 |
|
$ |
377,867 |
|
Accrued salaries, wages and employee benefits |
|
86,014 |
|
83,810 |
| ||
Accrued income taxes |
|
78,956 |
|
87,315 |
| ||
Other accrued expenses |
|
127,425 |
|
93,125 |
| ||
Short-term debt |
|
94,093 |
|
298 |
| ||
|
|
|
|
|
| ||
Total current liabilities |
|
864,588 |
|
642,415 |
| ||
|
|
|
|
|
| ||
Long-term debt |
|
1,511,297 |
|
1,376,831 |
| ||
Accrued pension and post employment benefit obligations |
|
205,922 |
|
207,049 |
| ||
Other long-term liabilities |
|
50,940 |
|
34,144 |
| ||
|
|
|
|
|
| ||
Equity: |
|
|
|
|
| ||
Common stock |
|
162 |
|
163 |
| ||
Additional paid-in capital |
|
302,547 |
|
189,166 |
| ||
Accumulated earnings |
|
2,237,109 |
|
2,102,497 |
| ||
Accumulated other comprehensive loss |
|
(112,977 |
) |
(120,057 |
) | ||
|
|
|
|
|
| ||
Total shareholders equity attributable to Amphenol Corporation |
|
2,426,841 |
|
2,171,769 |
| ||
|
|
|
|
|
| ||
Noncontrolling interests |
|
11,377 |
|
13,017 |
| ||
|
|
|
|
|
| ||
Total equity |
|
2,438,218 |
|
2,184,786 |
| ||
|
|
|
|
|
| ||
|
|
$ |
5,070,965 |
|
$ |
4,445,225 |
|
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited)
(dollars in thousands)
|
|
Nine months ended |
| ||||
|
|
September 30, |
| ||||
|
|
2012 |
|
2011 |
| ||
|
|
|
|
|
| ||
Cash flow from operating activities: |
|
|
|
|
| ||
Net income |
|
$ |
417,941 |
|
$ |
413,837 |
|
Adjustments for cash flow from operating activities: |
|
|
|
|
| ||
Depreciation and amortization |
|
89,339 |
|
88,197 |
| ||
Stock-based compensation expense |
|
23,167 |
|
21,011 |
| ||
Non-cash casualty loss related to flood |
|
|
|
12,400 |
| ||
Change in contingent acquisition related obligations |
|
|
|
(17,813 |
) | ||
Excess tax benefits from stock-based compensation payment arrangements |
|
(17,805 |
) |
(5,624 |
) | ||
Net change in components of working capital |
|
(44,789 |
) |
(125,644 |
) | ||
Net change in other long-term assets and liabilities |
|
(250 |
) |
10,225 |
| ||
|
|
|
|
|
| ||
Cash flow provided by operating activities |
|
467,603 |
|
396,589 |
| ||
|
|
|
|
|
| ||
Cash flow from investing activities: |
|
|
|
|
| ||
Additions to property, plant and equipment |
|
(96,489 |
) |
(72,048 |
) | ||
Proceeds from disposals of fixed assets |
|
4,174 |
|
7,134 |
| ||
Purchases of short-term investments |
|
(220,330 |
) |
(93,833 |
) | ||
Sales and maturities of short-term investments |
|
186,833 |
|
101,444 |
| ||
Acquisitions, net of cash acquired |
|
(179,597 |
) |
(52,993 |
) | ||
|
|
|
|
|
| ||
Cash flow used in investing activities |
|
(305,409 |
) |
(110,296 |
) | ||
|
|
|
|
|
| ||
Cash flow from financing activities: |
|
|
|
|
| ||
Borrowings under senior notes |
|
498,730 |
|
|
| ||
Borrowings under credit facilities |
|
606,600 |
|
675,100 |
| ||
Repayments under credit facilities |
|
(876,960 |
) |
(215,598 |
) | ||
Payment of fees and expenses related to debt financing |
|
(4,318 |
) |
(2,125 |
) | ||
Proceeds from exercise of stock options |
|
73,450 |
|
24,255 |
| ||
Excess tax benefits from stock-based compensation payment arrangements |
|
17,805 |
|
5,624 |
| ||
Payment of contingent acquisition related obligations |
|
|
|
(40,000 |
) | ||
Payments to shareholders of noncontrolling interests |
|
(4,713 |
) |
(28,689 |
) | ||
Purchase and retirement of treasury stock |
|
(229,442 |
) |
(534,000 |
) | ||
Dividend payments |
|
(36,385 |
) |
(7,788 |
) | ||
|
|
|
|
|
| ||
Cash flow provided by (used in) financing activities |
|
44,767 |
|
(123,221 |
) | ||
|
|
|
|
|
| ||
Effect of exchange rate changes on cash and cash equivalents |
|
3,499 |
|
1,219 |
| ||
|
|
|
|
|
| ||
Net change in cash and cash equivalents |
|
210,460 |
|
164,291 |
| ||
Cash and cash equivalents balance, beginning of period |
|
515,086 |
|
525,888 |
| ||
|
|
|
|
|
| ||
Cash and cash equivalents balance, end of period |
|
$ |
725,546 |
|
$ |
690,179 |
|
AMPHENOL CORPORATION
SEGMENT INFORMATION
(dollars in thousands)
(Unaudited)
|
|
Three months ended |
|
Nine months ended |
| ||||||||
|
|
September 30, |
|
September 30, |
| ||||||||
|
|
2012 |
|
2011 |
|
2012 |
|
2011 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Trade Sales: |
|
|
|
|
|
|
|
|
| ||||
Interconnect Products |
|
$ |
1,033,309 |
|
$ |
957,153 |
|
$ |
2,926,834 |
|
$ |
2,778,418 |
|
Cable Products |
|
70,067 |
|
75,601 |
|
219,253 |
|
212,659 |
| ||||
Consolidated |
|
$ |
1,103,376 |
|
$ |
1,032,754 |
|
$ |
3,146,087 |
|
$ |
2,991,077 |
|
|
|
|
|
|
|
|
|
|
| ||||
Operating income: |
|
|
|
|
|
|
|
|
| ||||
Interconnect Products |
|
$ |
224,517 |
|
$ |
205,611 |
|
$ |
627,962 |
|
$ |
603,103 |
|
Cable Products |
|
8,697 |
|
9,874 |
|
29,831 |
|
26,833 |
| ||||
Stock-based compensation expense |
|
(8,066 |
) |
(7,630 |
) |
(23,167 |
) |
(21,011 |
) | ||||
Change in contingent acquisition related obligations |
|
|
|
|
|
|
|
17,813 |
| ||||
Casualty loss related to flood |
|
|
|
(12,831 |
) |
|
|
(12,831 |
) | ||||
Other operating expenses |
|
(9,478 |
) |
(8,965 |
) |
(27,501 |
) |
(26,889 |
) | ||||
Consolidated |
|
$ |
215,670 |
|
$ |
186,059 |
|
$ |
607,125 |
|
$ |
587,018 |
|
|
|
|
|
|
|
|
|
|
| ||||
ROS%: |
|
|
|
|
|
|
|
|
| ||||
Interconnect Products |
|
21.7 |
% |
21.5 |
% |
21.5 |
% |
21.7 |
% | ||||
Cable Products |
|
12.4 |
% |
13.1 |
% |
13.6 |
% |
12.6 |
% | ||||
Corporate - stock-based compensation |
|
-0.7 |
% |
-0.7 |
% |
-0.7 |
% |
-0.7 |
% | ||||
Change in contingent acquisition related obligations |
|
0.0 |
% |
0.0 |
% |
0.0 |
% |
0.6 |
% | ||||
Casualty loss related to flood |
|
0.0 |
% |
-1.3 |
% |
0.0 |
% |
-0.4 |
% | ||||
Corporate - all other |
|
-0.9 |
% |
-0.9 |
% |
-0.9 |
% |
-0.9 |
% | ||||
|
|
|
|
|
|
|
|
|
| ||||
Consolidated |
|
19.5 |
% |
18.0 |
% |
19.3 |
% |
19.6 |
% |