Delaware | 001-12561 | 36-3601505 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
Item 2.02 Results of Operations and Financial Condition. | ||
Item 9.01 Financial Statements and Exhibits. | ||
SIGNATURES | ||
EXHIBIT INDEX | ||
Exhibit 99.1 News Release dated August 2, 2017 |
99.1 | Company news release dated August 2, 2017, titled “Belden Reports Solid Results for Second Quarter 2017” |
BELDEN INC. | ||||||
Date: August 2, 2017 | By: | /s/ Brian E. Anderson | ||||
Brian E. Anderson | ||||||
Senior Vice President-Legal, General | ||||||
Counsel and Corporate Secretary |
1 North Brentwood Boulevard | Phone: 314.854.8000 | |||
15th Floor | Fax: 314.854.8003 | |||
St. Louis, Missouri 63105 | ||||
www.Belden.com |
Three Months Ended | Six Months Ended | |||||||||||||||
July 2, 2017 | July 3, 2016 | July 2, 2017 | July 3, 2016 | |||||||||||||
(In thousands, except per share data) | ||||||||||||||||
Revenues | $ | 610,633 | $ | 601,631 | $ | 1,162,014 | $ | 1,143,128 | ||||||||
Cost of sales | (368,124 | ) | (353,418 | ) | (697,391 | ) | (669,880 | ) | ||||||||
Gross profit | 242,509 | 248,213 | 464,623 | 473,248 | ||||||||||||
Selling, general and administrative expenses | (117,771 | ) | (123,057 | ) | (230,357 | ) | (245,463 | ) | ||||||||
Research and development | (35,144 | ) | (36,652 | ) | (69,666 | ) | (72,785 | ) | ||||||||
Amortization of intangibles | (27,113 | ) | (26,263 | ) | (50,782 | ) | (51,795 | ) | ||||||||
Operating income | 62,481 | 62,241 | 113,818 | 103,205 | ||||||||||||
Interest expense, net | (23,533 | ) | (24,049 | ) | (47,039 | ) | (48,445 | ) | ||||||||
Loss on debt extinguishment | (847 | ) | — | (847 | ) | — | ||||||||||
Income before taxes | 38,101 | 38,192 | 65,932 | 54,760 | ||||||||||||
Income tax benefit (expense) | (2,210 | ) | 3,741 | (4,460 | ) | 3,531 | ||||||||||
Net income | 35,891 | 41,933 | 61,472 | 58,291 | ||||||||||||
Less: Net loss attributable to noncontrolling interest | (86 | ) | (99 | ) | (192 | ) | (198 | ) | ||||||||
Net income attributable to Belden | 35,977 | 42,032 | 61,664 | 58,489 | ||||||||||||
Less: Preferred stock dividends | 8,733 | — | 17,466 | — | ||||||||||||
Net income attributable to Belden common stockholders | $ | 27,244 | $ | 42,032 | $ | 44,198 | $ | 58,489 | ||||||||
Weighted average number of common shares and equivalents: | ||||||||||||||||
Basic | 42,283 | 42,085 | 42,249 | 42,046 | ||||||||||||
Diluted | 42,832 | 42,533 | 42,753 | 42,459 | ||||||||||||
Basic income per share attributable to Belden common stockholders: | $ | 0.64 | $ | 1.00 | $ | 1.05 | $ | 1.39 | ||||||||
Diluted income per share attributable to Belden common stockholders: | $ | 0.64 | $ | 0.99 | $ | 1.03 | $ | 1.38 | ||||||||
Common stock dividends declared per share | $ | 0.05 | $ | 0.05 | $ | 0.10 | $ | 0.10 |
Broadcast Solutions | Enterprise Solutions | Industrial Solutions | Network Solutions | Total Segments | ||||||||||||||||
(In thousands, except percentages) | ||||||||||||||||||||
For the three months ended July 2, 2017 | ||||||||||||||||||||
Segment Revenues | $ | 188,071 | $ | 160,733 | $ | 159,255 | $ | 102,574 | $ | 610,633 | ||||||||||
Segment EBITDA | 29,610 | 26,801 | 31,036 | 22,780 | 110,227 | |||||||||||||||
Segment EBITDA margin | 15.7 | % | 16.7 | % | 19.5 | % | 22.2 | % | 18.1 | % | ||||||||||
Depreciation expense | 4,058 | 2,695 | 3,168 | 1,607 | 11,528 | |||||||||||||||
Amortization of intangibles | 13,453 | 429 | 640 | 12,591 | 27,113 | |||||||||||||||
Severance, restructuring, and acquisition integration costs | 970 | 8,141 | 346 | 103 | 9,560 | |||||||||||||||
Purchase accounting effects related to acquisitions | 1,167 | — | — | — | 1,167 | |||||||||||||||
For the three months ended July 3, 2016 | ||||||||||||||||||||
Segment Revenues | $ | 193,521 | $ | 160,401 | $ | 147,808 | $ | 101,651 | $ | 603,381 | ||||||||||
Segment EBITDA | 29,505 | 29,575 | 27,064 | 22,191 | 108,335 | |||||||||||||||
Segment EBITDA margin | 15.2 | % | 18.4 | % | 18.3 | % | 21.8 | % | 18.0 | % | ||||||||||
Depreciation expense | 4,061 | 3,429 | 2,709 | 1,788 | 11,987 | |||||||||||||||
Amortization of intangibles | 13,420 | 432 | 601 | 11,810 | 26,263 | |||||||||||||||
Severance, restructuring, and acquisition integration costs | 1,319 | 1,207 | 2,371 | 972 | 5,869 | |||||||||||||||
Deferred gross profit adjustments | 494 | — | — | 1,256 | 1,750 | |||||||||||||||
For the six months ended July 2, 2017 | ||||||||||||||||||||
Segment Revenues | $ | 356,667 | $ | 306,415 | $ | 305,436 | $ | 193,496 | $ | 1,162,014 | ||||||||||
Segment EBITDA | 55,010 | 50,901 | 56,769 | 40,657 | 203,337 | |||||||||||||||
Segment EBITDA margin | 15.4 | % | 16.6 | % | 18.6 | % | 21.0 | % | 17.5 | % | ||||||||||
Depreciation expense | 8,007 | 5,294 | 6,374 | 3,236 | 22,911 | |||||||||||||||
Amortization of intangibles | 23,468 | 853 | 1,282 | 25,179 | 50,782 | |||||||||||||||
Severance, restructuring, and acquisition integration costs | 1,378 | 13,014 | 1,467 | 301 | 16,160 | |||||||||||||||
Purchase accounting effects related to acquisitions | 1,167 | — | — | — | 1,167 | |||||||||||||||
For the six months ended July 3, 2016 | ||||||||||||||||||||
Segment Revenues | $ | 364,793 | $ | 296,293 | $ | 288,899 | $ | 197,196 | $ | 1,147,181 | ||||||||||
Segment EBITDA | 52,772 | 53,311 | 50,051 | 42,267 | 198,401 | |||||||||||||||
Segment EBITDA margin | 14.5 | % | 18.0 | % | 17.3 | % | 21.4 | % | 17.3 | % | ||||||||||
Depreciation expense | 8,023 | 6,818 | 5,427 | 3,382 | 23,650 | |||||||||||||||
Amortization of intangibles | 26,351 | 861 | 1,192 | 23,391 | 51,795 | |||||||||||||||
Severance, restructuring, and acquisition integration costs | 5,697 | 1,707 | 3,236 | 3,637 | 14,277 | |||||||||||||||
Purchase accounting effects related to acquisitions | 195 | — | — | — | 195 | |||||||||||||||
Deferred gross profit adjustments | 1,108 | — | — | 2,945 | 4,053 |
Three Months Ended | Six Months Ended | |||||||||||||||
July 2, 2017 | July 3, 2016 | July 2, 2017 | July 3, 2016 | |||||||||||||
(In thousands) | ||||||||||||||||
Total Segment Revenues | $ | 610,633 | $ | 603,381 | $ | 1,162,014 | $ | 1,147,181 | ||||||||
Deferred revenue adjustments | — | (1,750 | ) | — | (4,053 | ) | ||||||||||
Consolidated Revenues | $ | 610,633 | $ | 601,631 | $ | 1,162,014 | $ | 1,143,128 | ||||||||
Total Segment EBITDA | $ | 110,227 | $ | 108,335 | $ | 203,337 | $ | 198,401 | ||||||||
Income from equity method investment | 2,277 | 661 | 3,284 | 491 | ||||||||||||
Eliminations | (655 | ) | (886 | ) | (1,783 | ) | (1,717 | ) | ||||||||
Consolidated Adjusted EBITDA (1) | 111,849 | 108,110 | 204,838 | 197,175 | ||||||||||||
Amortization of intangibles | (27,113 | ) | (26,263 | ) | (50,782 | ) | (51,795 | ) | ||||||||
Depreciation expense | (11,528 | ) | (11,987 | ) | (22,911 | ) | (23,650 | ) | ||||||||
Severance, restructuring, and acquisition integration costs | (9,560 | ) | (5,869 | ) | (16,160 | ) | (14,277 | ) | ||||||||
Purchase accounting effects related to acquisitions | (1,167 | ) | — | (1,167 | ) | (195 | ) | |||||||||
Deferred gross profit adjustments | — | (1,750 | ) | — | (4,053 | ) | ||||||||||
Consolidated operating income | 62,481 | 62,241 | 113,818 | 103,205 | ||||||||||||
Interest expense, net | (23,533 | ) | (24,049 | ) | (47,039 | ) | (48,445 | ) | ||||||||
Loss on debt extinguishment | (847 | ) | — | (847 | ) | — | ||||||||||
Consolidated income before taxes | $ | 38,101 | $ | 38,192 | $ | 65,932 | $ | 54,760 |
(1) | Consolidated Adjusted EBITDA is a non-GAAP measure. See Reconciliation of Non-GAAP Measures for additional information. |
July 2, 2017 | December 31, 2016 | |||||||
(Unaudited) | ||||||||
(In thousands) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 670,360 | $ | 848,116 | ||||
Receivables, net | 419,591 | 388,059 | ||||||
Inventories, net | 252,534 | 190,408 | ||||||
Other current assets | 43,623 | 29,176 | ||||||
Assets held for sale | 30,743 | 23,193 | ||||||
Total current assets | 1,416,851 | 1,478,952 | ||||||
Property, plant and equipment, less accumulated depreciation | 319,371 | 309,291 | ||||||
Goodwill | 1,453,993 | 1,385,995 | ||||||
Intangible assets, less accumulated amortization | 600,417 | 560,082 | ||||||
Deferred income taxes | 35,735 | 33,706 | ||||||
Other long-lived assets | 36,303 | 38,777 | ||||||
$ | 3,862,670 | $ | 3,806,803 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 280,796 | $ | 258,203 | ||||
Accrued liabilities | 255,092 | 310,340 | ||||||
Liabilities held for sale | 1,803 | 1,736 | ||||||
Total current liabilities | 537,691 | 570,279 | ||||||
Long-term debt | 1,679,382 | 1,620,161 | ||||||
Postretirement benefits | 109,599 | 104,050 | ||||||
Deferred income taxes | 18,341 | 14,276 | ||||||
Other long-term liabilities | 38,554 | 36,720 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock | 1 | 1 | ||||||
Common stock | 503 | 503 | ||||||
Additional paid-in capital | 1,119,763 | 1,116,090 | ||||||
Retained earnings | 823,761 | 783,812 | ||||||
Accumulated other comprehensive loss | (65,188 | ) | (39,067 | ) | ||||
Treasury stock | (400,501 | ) | (401,026 | ) | ||||
Total Belden stockholders’ equity | 1,478,339 | 1,460,313 | ||||||
Noncontrolling interest | 764 | 1,004 | ||||||
Total stockholders’ equity | 1,479,103 | 1,461,317 | ||||||
$ | 3,862,670 | $ | 3,806,803 |
Six Months Ended | ||||||||
July 2, 2017 | July 3, 2016 | |||||||
(In thousands) | ||||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 61,472 | $ | 58,291 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 73,693 | 75,445 | ||||||
Share-based compensation | 8,924 | 8,587 | ||||||
Loss on debt extinguishment | 847 | — | ||||||
Changes in operating assets and liabilities, net of the effects of currency exchange rate changes and acquired businesses: | ||||||||
Receivables | (17,982 | ) | (3,750 | ) | ||||
Inventories | (42,052 | ) | 368 | |||||
Accounts payable | 14,748 | (20,730 | ) | |||||
Accrued liabilities | (55,094 | ) | (39,356 | ) | ||||
Accrued taxes | (12,523 | ) | (17,875 | ) | ||||
Other assets | (6,573 | ) | 2,457 | |||||
Other liabilities | 9,321 | (2,867 | ) | |||||
Net cash provided by operating activities | 34,781 | 60,570 | ||||||
Cash flows from investing activities: | ||||||||
Cash used to acquire businesses, net of cash acquired | (166,945 | ) | (17,848 | ) | ||||
Capital expenditures | (22,197 | ) | (25,124 | ) | ||||
Proceeds from disposal of tangible assets | — | 41 | ||||||
Net cash used for investing activities | (189,142 | ) | (42,931 | ) | ||||
Cash flows from financing activities: | ||||||||
Cash dividends paid | (21,688 | ) | (4,204 | ) | ||||
Payments under borrowing arrangements | (5,221 | ) | (51,250 | ) | ||||
Withholding tax payments for share-based payment awards, net of proceeds from the exercise of stock options | (4,726 | ) | (3,598 | ) | ||||
Debt issuance costs paid | (2,044 | ) | — | |||||
Net cash used for financing activities | (33,679 | ) | (59,052 | ) | ||||
Effect of foreign currency exchange rate changes on cash and cash equivalents | 10,284 | 434 | ||||||
Decrease in cash and cash equivalents | (177,756 | ) | (40,979 | ) | ||||
Cash and cash equivalents, beginning of period | 848,116 | 216,751 | ||||||
Cash and cash equivalents, end of period | $ | 670,360 | $ | 175,772 |
Three Months Ended | Six Months Ended | |||||||||||||||
July 2, 2017 | July 3, 2016 | July 2, 2017 | July 3, 2016 | |||||||||||||
(In thousands, except percentages and per share amounts) | ||||||||||||||||
GAAP revenues | $ | 610,633 | $ | 601,631 | $ | 1,162,014 | $ | 1,143,128 | ||||||||
Deferred revenue adjustments | — | 1,750 | — | 4,053 | ||||||||||||
Adjusted revenues | $ | 610,633 | $ | 603,381 | $ | 1,162,014 | $ | 1,147,181 | ||||||||
GAAP gross profit | $ | 242,509 | $ | 248,213 | $ | 464,623 | $ | 473,248 | ||||||||
Severance, restructuring, and acquisition integration costs | 8,189 | 1,826 | 14,117 | 3,918 | ||||||||||||
Deferred gross profit adjustments | — | 1,750 | — | 4,053 | ||||||||||||
Purchase accounting effects related to acquisitions | 1,167 | — | 1,167 | 195 | ||||||||||||
Accelerated depreciation | 266 | 206 | 532 | 412 | ||||||||||||
Adjusted gross profit | $ | 252,131 | $ | 251,995 | $ | 480,439 | $ | 481,826 | ||||||||
GAAP gross profit margin | 39.7 | % | 41.3 | % | 40.0 | % | 41.4 | % | ||||||||
Adjusted gross profit margin | 41.3 | % | 41.8 | % | 41.3 | % | 42.0 | % | ||||||||
GAAP selling, general and administrative expenses | $ | (117,771 | ) | $ | (123,057 | ) | $ | (230,357 | ) | $ | (245,463 | ) | ||||
Severance, restructuring, and acquisition integration costs | 1,362 | 3,625 | 2,090 | 9,680 | ||||||||||||
Adjusted selling, general and administrative expenses | $ | (116,409 | ) | $ | (119,432 | ) | $ | (228,267 | ) | $ | (235,783 | ) | ||||
GAAP research and development | $ | (35,144 | ) | $ | (36,652 | ) | $ | (69,666 | ) | $ | (72,785 | ) | ||||
Severance, restructuring, and acquisition integration costs | 9 | 418 | (47 | ) | 679 | |||||||||||
Adjusted research and development | $ | (35,135 | ) | $ | (36,234 | ) | $ | (69,713 | ) | $ | (72,106 | ) | ||||
GAAP net income attributable to Belden | $ | 35,977 | $ | 42,032 | $ | 61,664 | $ | 58,489 | ||||||||
Interest expense, net | 23,533 | 24,049 | 47,039 | 48,445 | ||||||||||||
Income tax expense (benefit) | 2,210 | (3,741 | ) | 4,460 | (3,531 | ) | ||||||||||
Loss on debt extinguishment | 847 | — | 847 | — | ||||||||||||
Noncontrolling interest | (86 | ) | (99 | ) | (192 | ) | (198 | ) | ||||||||
Total non-operating adjustments | 26,504 | 20,209 | 52,154 | 44,716 | ||||||||||||
Amortization of intangible assets | 27,113 | 26,263 | 50,782 | 51,795 | ||||||||||||
Severance, restructuring, and integration costs | 9,560 | 5,869 | 16,160 | 14,277 | ||||||||||||
Purchase accounting effects related to acquisitions | 1,167 | — | 1,167 | 195 | ||||||||||||
Accelerated depreciation | 266 | 206 | 532 | 412 | ||||||||||||
Deferred gross profit adjustments | — | 1,750 | — | 4,053 | ||||||||||||
Total operating income adjustments | 38,106 | 34,088 | 68,641 | 70,732 | ||||||||||||
Depreciation expense | 11,262 | 11,781 | 22,379 | 23,238 | ||||||||||||
Adjusted EBITDA | $ | 111,849 | $ | 108,110 | $ | 204,838 | $ | 197,175 | ||||||||
GAAP net income margin | 5.9 | % | 7.0 | % | 5.3 | % | 5.1 | % | ||||||||
Adjusted EBITDA margin | 18.3 | % | 17.9 | % | 17.6 | % | 17.2 | % | ||||||||
GAAP net income | $ | 35,891 | $ | 41,933 | $ | 61,472 | $ | 58,291 | ||||||||
Operating income adjustments from above | 38,106 | 34,088 | 68,641 | 70,732 | ||||||||||||
Loss on debt extinguishment | 847 | — | 847 | — | ||||||||||||
Tax effect of adjustments | (10,592 | ) | (10,603 | ) | (18,968 | ) | (21,030 | ) | ||||||||
Adjusted net income | $ | 64,252 | $ | 65,418 | $ | 111,992 | $ | 107,993 | ||||||||
GAAP net income | $ | 35,891 | $ | 41,933 | $ | 61,472 | $ | 58,291 | ||||||||
Less: Net loss attributable to noncontrolling interest | (86 | ) | (99 | ) | (192 | ) | (198 | ) | ||||||||
Less: Preferred stock dividends | 8,733 | — | 17,466 | — | ||||||||||||
GAAP net income attributable to Belden common stockholders | $ | 27,244 | $ | 42,032 | $ | 44,198 | $ | 58,489 | ||||||||
Adjusted net income | $ | 64,252 | $ | 65,418 | $ | 111,992 | $ | 107,993 | ||||||||
Less: Net loss attributable to noncontrolling interest | (86 | ) | (99 | ) | (192 | ) | (198 | ) | ||||||||
Less: Amortization expense attributable to noncontrolling interest, net of tax | 16 | 16 | 31 | 32 | ||||||||||||
Less: Preferred stock dividends | — | — | 17,466 | — | ||||||||||||
Adjusted net income attributable to Belden common stockholders | $ | 64,322 | $ | 65,501 | $ | 94,687 | $ | 108,159 | ||||||||
GAAP income per diluted share attributable to Belden common stockholders | $ | 0.64 | $ | 0.99 | $ | 1.03 | $ | 1.38 | ||||||||
Adjusted income per diluted share attributable to Belden common stockholders | $ | 1.29 | $ | 1.54 | $ | 2.21 | $ | 2.55 | ||||||||
GAAP diluted weighted average shares | 42,832 | 42,533 | 42,753 | 42,459 | ||||||||||||
Adjustment for assumed conversion of preferred stock into common stock | 6,857 | — | — | — | ||||||||||||
Adjusted diluted weighted average shares | 49,689 | 42,533 | 42,753 | 42,459 |
Three Months Ended | Six Months Ended | |||||||||||||||
July 2, 2017 | July 3, 2016 | July 2, 2017 | July 3, 2016 | |||||||||||||
(In thousands) | ||||||||||||||||
GAAP net cash provided by operating activities | $ | 47,044 | $ | 47,958 | $ | 34,781 | $ | 60,570 | ||||||||
Capital expenditures, net of proceeds from the disposal of tangible assets | (11,798 | ) | (11,662 | ) | (22,197 | ) | (25,083 | ) | ||||||||
Non-GAAP free cash flow | $ | 35,246 | $ | 36,296 | $ | 12,584 | $ | 35,487 |
Year Ended December 31, 2017 | Three Months Ended October 1, 2017 | |||
Adjusted income per diluted share attributable to Belden common stockholders | $5.35 - $5.55 | $1.35 - $1.45 | ||
Amortization of intangible assets | $(1.51) | $(0.47) | ||
Loss on debt extinguishment | $(0.52) | $(0.51) | ||
Severance, restructuring, and acquisition integration costs | $(0.40) | $(0.21) | ||
Purchase accounting effects related to acquisitions | $(0.10) | $(0.06) | ||
GAAP income per diluted share attributable to Belden common stockholders | $2.82 - $3.02 | $0.10 - $0.20 |