Delaware | 001-12561 | 36-3601505 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
d) Exhibits. | ||
Exhibit Number | Description | |
99.1 |
BELDEN INC. | ||||||
Date: February 20, 2019 | By: | /s/ Brian E. Anderson | ||||
Brian E. Anderson | ||||||
Senior Vice President-Legal, General | ||||||
Counsel and Corporate Secretary |
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1 North Brentwood Boulevard | Phone: 314.854.8000 | |||
15th Floor | Fax: 314.854.8003 | |||
St. Louis, Missouri 63105 | ||||
www.Belden.com |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | |||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||
(In thousands, except per share data) | ||||||||||||||||
Revenues | $ | 655,390 | $ | 604,884 | $ | 2,585,368 | $ | 2,388,643 | ||||||||
Cost of sales | (396,025 | ) | (375,458 | ) | (1,576,956 | ) | (1,453,890 | ) | ||||||||
Gross profit | 259,365 | 229,426 | 1,008,412 | 934,753 | ||||||||||||
Selling, general and administrative expenses | (129,488 | ) | (114,236 | ) | (525,918 | ) | (461,022 | ) | ||||||||
Research and development expenses | (32,804 | ) | (29,222 | ) | (140,585 | ) | (134,330 | ) | ||||||||
Amortization of intangibles | (23,839 | ) | (26,053 | ) | (98,829 | ) | (103,997 | ) | ||||||||
Gain from patent litigation | — | — | 62,141 | — | ||||||||||||
Operating income | 73,234 | 59,915 | 305,221 | 235,404 | ||||||||||||
Interest expense, net | (15,021 | ) | (16,477 | ) | (61,559 | ) | (82,901 | ) | ||||||||
Non-operating pension benefit (cost) | (1,166 | ) | 166 | (342 | ) | (714 | ) | |||||||||
Loss on debt extinguishment | — | — | (22,990 | ) | (52,441 | ) | ||||||||||
Income before taxes | 57,047 | 43,604 | 220,330 | 99,348 | ||||||||||||
Income tax expense | (13,556 | ) | (13,168 | ) | (59,619 | ) | (6,495 | ) | ||||||||
Net income | 43,491 | 30,436 | 160,711 | 92,853 | ||||||||||||
Less: Net loss attributable to noncontrolling interest | (35 | ) | (83 | ) | (183 | ) | (357 | ) | ||||||||
Net income attributable to Belden | 43,526 | 30,519 | 160,894 | 93,210 | ||||||||||||
Less: Preferred stock dividends | 8,733 | 8,733 | 34,931 | 34,931 | ||||||||||||
Net income attributable to Belden common stockholders | $ | 34,793 | $ | 21,786 | $ | 125,963 | $ | 58,279 | ||||||||
Weighted average number of common shares and equivalents: | ||||||||||||||||
Basic | 39,830 | 42,126 | 40,675 | 42,220 | ||||||||||||
Diluted | 40,031 | 42,581 | 40,956 | 42,643 | ||||||||||||
Basic income per share attributable to Belden common stockholders: | $ | 0.87 | $ | 0.52 | $ | 3.10 | $ | 1.38 | ||||||||
Diluted income per share attributable to Belden common stockholders: | $ | 0.87 | $ | 0.51 | $ | 3.08 | $ | 1.37 | ||||||||
Common stock dividends declared per share | $ | 0.05 | $ | 0.05 | $ | 0.20 | $ | 0.20 |
Enterprise Solutions | Industrial Solutions | Total Segments | ||||||||||
(In thousands, except percentages) | ||||||||||||
For the three months ended December 31, 2018 | ||||||||||||
Segment Revenues | $ | 379,413 | $ | 274,700 | $ | 654,113 | ||||||
Segment EBITDA | 67,713 | 54,323 | 122,036 | |||||||||
Segment EBITDA margin | 17.8 | % | 19.8 | % | 18.7 | % | ||||||
Depreciation expense | 7,396 | 4,657 | 12,053 | |||||||||
Amortization of intangibles | 10,643 | 13,196 | 23,839 | |||||||||
Amortization of software development intangible assets | 836 | 8 | 844 | |||||||||
Severance, restructuring, and acquisition integration costs | 10,614 | 989 | 11,603 | |||||||||
Purchase accounting effects of acquisitions | 1,138 | — | 1,138 | |||||||||
Deferred revenue adjustments | (1,277 | ) | — | (1,277 | ) | |||||||
For the three months ended December 31, 2017 | ||||||||||||
Segment Revenues | $ | 332,381 | $ | 272,503 | $ | 604,884 | ||||||
Segment EBITDA | 48,485 | 60,515 | 109,000 | |||||||||
Segment EBITDA margin | 14.6 | % | 22.2 | % | 18.0 | % | ||||||
Depreciation expense | 6,143 | 4,860 | 11,003 | |||||||||
Amortization of intangibles | 12,813 | 13,240 | 26,053 | |||||||||
Amortization of software development intangible assets | 56 | — | 56 | |||||||||
Severance, restructuring, and acquisition integration costs | 5,342 | 4,609 | 9,951 | |||||||||
Purchase accounting effects of acquisitions | 2,044 | — | 2,044 | |||||||||
For the twelve months ended December 31, 2018 | ||||||||||||
Segment Revenues | $ | 1,522,178 | $ | 1,069,802 | $ | 2,591,980 | ||||||
Segment EBITDA | 267,656 | 207,724 | 475,380 | |||||||||
Segment EBITDA margin | 17.6 | % | 19.4 | % | 18.3 | % | ||||||
Depreciation expense | 28,861 | 18,754 | 47,615 | |||||||||
Amortization of intangibles | 45,944 | 52,885 | 98,829 | |||||||||
Amortization of software development intangible assets | 2,180 | 8 | 2,188 | |||||||||
Severance, restructuring, and acquisition integration costs | 57,563 | 11,050 | 68,613 | |||||||||
Purchase accounting effects of acquisitions | 3,497 | — | 3,497 | |||||||||
Deferred revenue adjustments | 6,612 | — | 6,612 | |||||||||
For the twelve months ended December 31, 2017 | ||||||||||||
Segment Revenues | $ | 1,356,305 | $ | 1,032,338 | $ | 2,388,643 | ||||||
Segment EBITDA | 216,558 | 214,190 | 430,748 | |||||||||
Segment EBITDA margin | 16.0 | % | 20.7 | % | 18.0 | % | ||||||
Depreciation expense | 26,272 | 19,325 | 45,597 | |||||||||
Amortization of intangibles | 51,054 | 52,943 | 103,997 | |||||||||
Amortization of software development intangible assets | 56 | — | 56 | |||||||||
Severance, restructuring, and acquisition integration costs | 29,043 | 13,747 | 42,790 | |||||||||
Purchase accounting effects of acquisitions | 6,133 | — | 6,133 |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | |||||||||||||
(In thousands) | ||||||||||||||||
Total Segment Revenues | $ | 654,113 | $ | 604,884 | $ | 2,591,980 | $ | 2,388,643 | ||||||||
Deferred revenue adjustments | 1,277 | — | (6,612 | ) | — | |||||||||||
Consolidated Revenues | $ | 655,390 | $ | 604,884 | $ | 2,585,368 | $ | 2,388,643 | ||||||||
Total Segment EBITDA | $ | 122,036 | $ | 109,000 | $ | 475,380 | $ | 430,748 | ||||||||
Eliminations | (602 | ) | (632 | ) | (2,218 | ) | (3,260 | ) | ||||||||
Total non-operating pension benefit (cost) | (1,166 | ) | 166 | (342 | ) | (714 | ) | |||||||||
Non-operating pension settlement loss | 1,342 | — | 1,342 | — | ||||||||||||
Income from equity method investment | — | 1,667 | — | 7,502 | ||||||||||||
Consolidated Adjusted EBITDA (1) | 121,610 | 110,201 | 474,162 | 434,276 | ||||||||||||
Amortization of intangibles | (23,839 | ) | (26,053 | ) | (98,829 | ) | (103,997 | ) | ||||||||
Severance, restructuring, and acquisition integration costs | (11,603 | ) | (9,951 | ) | (68,613 | ) | (42,790 | ) | ||||||||
Interest expense, net | (15,021 | ) | (16,477 | ) | (61,559 | ) | (82,901 | ) | ||||||||
Depreciation expense | (12,053 | ) | (11,003 | ) | (47,615 | ) | (45,597 | ) | ||||||||
Loss on debt extinguishment | — | — | (22,990 | ) | (52,441 | ) | ||||||||||
Deferred revenue adjustments | 1,277 | — | (6,612 | ) | — | |||||||||||
Purchase accounting effects related to acquisitions | (1,138 | ) | (2,044 | ) | (3,497 | ) | (6,133 | ) | ||||||||
Costs related to patent litigation | — | — | (2,634 | ) | — | |||||||||||
Amortization of software development intangible assets | (844 | ) | (56 | ) | (2,188 | ) | (56 | ) | ||||||||
Non-operating pension settlement loss | (1,342 | ) | — | (1,342 | ) | — | ||||||||||
Loss on sale of assets | — | (1,013 | ) | (94 | ) | (1,013 | ) | |||||||||
Gain from patent litigation | — | — | 62,141 | — | ||||||||||||
Consolidated income before taxes | $ | 57,047 | $ | 43,604 | $ | 220,330 | $ | 99,348 |
(1) | Consolidated Adjusted EBITDA is a non-GAAP measure. See Reconciliation of Non-GAAP Measures for additional information. |
December 31, 2018 | December 31, 2017 | |||||||
(Unaudited) | ||||||||
(In thousands) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 420,610 | $ | 561,108 | ||||
Receivables, net | 465,939 | 473,570 | ||||||
Inventories, net | 316,418 | 297,226 | ||||||
Other current assets | 55,757 | 40,167 | ||||||
Total current assets | 1,258,724 | 1,372,071 | ||||||
Property, plant and equipment, less accumulated depreciation | 365,970 | 337,322 | ||||||
Goodwill | 1,557,653 | 1,478,257 | ||||||
Intangible assets, less accumulated amortization | 511,093 | 545,207 | ||||||
Deferred income taxes | 56,018 | 42,549 | ||||||
Other long-lived assets | 29,863 | 65,207 | ||||||
$ | 3,779,321 | $ | 3,840,613 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 352,646 | $ | 376,277 | ||||
Accrued liabilities | 364,276 | 302,651 | ||||||
Total current liabilities | 716,922 | 678,928 | ||||||
Long-term debt | 1,463,200 | 1,560,748 | ||||||
Postretirement benefits | 132,791 | 102,085 | ||||||
Deferred income taxes | 39,943 | 27,713 | ||||||
Other long-term liabilities | 38,877 | 36,273 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock | 1 | 1 | ||||||
Common stock | 503 | 503 | ||||||
Additional paid-in capital | 1,139,395 | 1,123,832 | ||||||
Retained earnings | 922,000 | 833,610 | ||||||
Accumulated other comprehensive loss | (74,907 | ) | (98,026 | ) | ||||
Treasury stock | (599,845 | ) | (425,685 | ) | ||||
Total Belden stockholders’ equity | 1,387,147 | 1,434,235 | ||||||
Noncontrolling interest | 441 | 631 | ||||||
Total stockholders’ equity | 1,387,588 | 1,434,866 | ||||||
$ | 3,779,321 | $ | 3,840,613 |
Twelve Months Ended | ||||||||
December 31, 2018 | December 31, 2017 | |||||||
(Unaudited) | ||||||||
(In thousands) | ||||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 160,711 | $ | 92,853 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 148,632 | 149,650 | ||||||
Share-based compensation | 18,497 | 14,647 | ||||||
Loss on debt extinguishment | 22,990 | 52,441 | ||||||
Deferred income tax expense (benefit) | 11,300 | (24,098 | ) | |||||
Changes in operating assets and liabilities, net of the effects of currency exchange rate changes and acquired businesses: | ||||||||
Receivables | (21,748 | ) | (24,931 | ) | ||||
Inventories | (14,779 | ) | (84,088 | ) | ||||
Accounts payable | (29,401 | ) | 100,752 | |||||
Accrued liabilities | 17,238 | (25,076 | ) | |||||
Income taxes | (4,390 | ) | 5,001 | |||||
Other assets | (18,748 | ) | (13,255 | ) | ||||
Other liabilities | (1,082 | ) | 11,404 | |||||
Net cash provided by operating activities | 289,220 | 255,300 | ||||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (97,847 | ) | (64,261 | ) | ||||
Cash used to acquire businesses, net of cash acquired | (84,580 | ) | (166,896 | ) | ||||
Proceeds from disposal of tangible assets | 1,580 | 1,039 | ||||||
Proceeds from disposal of business | 40,171 | — | ||||||
Net cash used for investing activities | (140,676 | ) | (230,118 | ) | ||||
Cash flows from financing activities: | ||||||||
Payments under borrowing arrangements | (484,757 | ) | (1,105,892 | ) | ||||
Payments under share repurchase program | (175,000 | ) | (25,000 | ) | ||||
Cash dividends paid | (43,169 | ) | (43,376 | ) | ||||
Debt issuance costs paid | (7,609 | ) | (17,316 | ) | ||||
Withholding tax payments for share-based payment awards | (2,094 | ) | (6,564 | ) | ||||
Redemption of stockholders' rights agreement | (411 | ) | — | |||||
Borrowings under credit arrangements | 431,270 | 866,700 | ||||||
Net cash used for financing activities | (281,770 | ) | (331,448 | ) | ||||
Effect of foreign currency exchange rate changes on cash and cash equivalents | (7,272 | ) | 19,258 | |||||
Decrease in cash and cash equivalents | (140,498 | ) | (287,008 | ) | ||||
Cash and cash equivalents, beginning of period | 561,108 | 848,116 | ||||||
Cash and cash equivalents, end of period | $ | 420,610 | $ | 561,108 |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | |||||||||||||
(In thousands, except percentages and per share amounts) | ||||||||||||||||
GAAP revenues | $ | 655,390 | $ | 604,884 | $ | 2,585,368 | $ | 2,388,643 | ||||||||
Deferred revenue adjustments | (1,277 | ) | — | 6,612 | — | |||||||||||
Adjusted revenues | $ | 654,113 | $ | 604,884 | $ | 2,591,980 | $ | 2,388,643 | ||||||||
GAAP gross profit | $ | 259,365 | $ | 229,426 | $ | 1,008,412 | $ | 934,753 | ||||||||
Severance, restructuring, and acquisition integration costs | 6,648 | 6,039 | 28,130 | 32,562 | ||||||||||||
Deferred revenue adjustments | (1,277 | ) | — | 6,612 | — | |||||||||||
Purchase accounting effects related to acquisitions | — | 2,044 | 1,833 | 6,133 | ||||||||||||
Amortization of software development intangible assets | 844 | 56 | 2,188 | 56 | ||||||||||||
Accelerated depreciation | — | — | — | 798 | ||||||||||||
Adjusted gross profit | $ | 265,580 | $ | 237,565 | $ | 1,047,175 | $ | 974,302 | ||||||||
GAAP gross profit margin | 39.6 | % | 37.9 | % | 39.0 | % | 39.1 | % | ||||||||
Adjusted gross profit margin | 40.6 | % | 39.3 | % | 40.4 | % | 40.8 | % | ||||||||
GAAP selling, general and administrative expenses | $ | (129,488 | ) | $ | (114,236 | ) | $ | (525,918 | ) | $ | (461,022 | ) | ||||
Severance, restructuring, and acquisition integration costs | 4,752 | 3,727 | 35,039 | 9,991 | ||||||||||||
Costs related to patent litigation | — | — | 2,634 | — | ||||||||||||
Purchase accounting effects related to acquisitions | 1,138 | — | 1,664 | — | ||||||||||||
Loss on sale of assets | — | 1,013 | 94 | 1,013 | ||||||||||||
Adjusted selling, general and administrative expenses | $ | (123,598 | ) | $ | (109,496 | ) | $ | (486,487 | ) | $ | (450,018 | ) | ||||
GAAP research and development expenses | $ | (32,804 | ) | $ | (29,222 | ) | $ | (140,585 | ) | $ | (134,330 | ) |
Severance, restructuring, and acquisition integration costs | 203 | 185 | 5,444 | 237 | ||||||||||||
Adjusted research and development expenses | $ | (32,601 | ) | $ | (29,037 | ) | $ | (135,141 | ) | $ | (134,093 | ) | ||||
GAAP net income attributable to Belden | $ | 43,526 | $ | 30,519 | $ | 160,894 | $ | 93,210 | ||||||||
Interest expense, net | 15,021 | 16,477 | 61,559 | 82,901 | ||||||||||||
Income tax expense | 13,556 | 13,168 | 59,619 | 6,495 | ||||||||||||
Loss on debt extinguishment | — | — | 22,990 | 52,441 | ||||||||||||
Noncontrolling interest | (35 | ) | (83 | ) | (183 | ) | (357 | ) | ||||||||
Total non-operating adjustments | 28,542 | 29,562 | 143,985 | 141,480 | ||||||||||||
Amortization of intangible assets | 23,839 | 26,053 | 98,829 | 103,997 | ||||||||||||
Severance, restructuring, and acquisition integration costs | 11,603 | 9,951 | 68,613 | 42,790 | ||||||||||||
Deferred revenue adjustments | (1,277 | ) | — | 6,612 | — | |||||||||||
Costs related to patent litigation | — | — | 2,634 | — | ||||||||||||
Purchase accounting effects related to acquisitions | 1,138 | 2,044 | 3,497 | 6,133 | ||||||||||||
Amortization of software development intangible assets | 844 | 56 | 2,188 | 56 | ||||||||||||
Non-operating pension settlement loss | 1,342 | — | 1,342 | — | ||||||||||||
Loss on sale of assets | — | 1,013 | 94 | 1,013 | ||||||||||||
Accelerated depreciation | — | — | — | 798 | ||||||||||||
Gain from patent litigation | — | — | (62,141 | ) | — | |||||||||||
Total operating income adjustments | 37,489 | 39,117 | 121,668 | 154,787 | ||||||||||||
Depreciation expense | 12,053 | 11,003 | 47,615 | 44,799 | ||||||||||||
Adjusted EBITDA | $ | 121,610 | $ | 110,201 | $ | 474,162 | $ | 434,276 | ||||||||
GAAP net income margin | 6.6 | % | 5.0 | % | 6.2 | % | 3.9 | % | ||||||||
Adjusted EBITDA margin | 18.6 | % | 18.2 | % | 18.3 | % | 18.2 | % | ||||||||
GAAP net income attributable to Belden | $ | 43,526 | $ | 30,519 | $ | 160,894 | $ | 93,210 | ||||||||
Operating income adjustments from above | 37,489 | 39,117 | 121,668 | 154,787 | ||||||||||||
Loss on debt extinguishment | — | — | 22,990 | 52,441 | ||||||||||||
Tax effect of adjustments above | (7,979 | ) | (19,046 | ) | (25,838 | ) | (63,796 | ) | ||||||||
Impact of Tax Cuts and Jobs Act enactment | 4,689 | 28,440 | 9,997 | 28,440 | ||||||||||||
Amortization expense attributable to noncontrolling interest, net of tax | (16 | ) | (16 | ) | (66 | ) | (63 | ) | ||||||||
Adjusted net income attributable to Belden | $ | 77,709 | $ | 79,014 | $ | 289,645 | $ | 265,019 | ||||||||
GAAP net income attributable to Belden | $ | 43,526 | $ | 30,519 | $ | 160,894 | $ | 93,210 | ||||||||
Less: Preferred stock dividends | 8,733 | 8,733 | 34,931 | 34,931 | ||||||||||||
GAAP net income attributable to Belden common stockholders | $ | 34,793 | $ | 21,786 | $ | 125,963 | $ | 58,279 | ||||||||
Adjusted net income attributable to Belden common stockholders | $ | 77,709 | $ | 79,014 | $ | 289,645 | $ | 265,019 | ||||||||
GAAP income per diluted share attributable to Belden common stockholders | $ | 0.87 | $ | 0.51 | $ | 3.08 | $ | 1.37 | ||||||||
Adjusted income per diluted share attributable to Belden common stockholders | $ | 1.66 | $ | 1.62 | $ | 6.06 | $ | 5.35 | ||||||||
GAAP diluted weighted average shares | 40,031 | 42,581 | 40,956 | 42,643 | ||||||||||||
Adjustment for assumed conversion of preferred stock into common stock | 6,857 | 6,268 | 6,857 | 6,857 | ||||||||||||
Adjusted diluted weighted average shares | 46,888 | 48,849 | 47,813 | 49,500 |
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | |||||||||||||
(In thousands) | ||||||||||||||||
GAAP net cash provided by operating activities | $ | 188,361 | $ | 151,685 | $ | 289,220 | $ | 255,300 | ||||||||
Capital expenditures, net of proceeds from the disposal of tangible assets | (34,372 | ) | (29,807 | ) | (96,267 | ) | (63,222 | ) | ||||||||
Non-GAAP free cash flow | $ | 153,989 | $ | 121,878 | $ | 192,953 | $ | 192,078 |
Year Ended December 31, 2019 | Three Months Ended March 31, 2019 | |||
Adjusted income per diluted share attributable to Belden common stockholders | $5.50 - $6.15 | $0.80 - $1.00 | ||
Amortization of intangible assets | (1.57) | (0.48) | ||
Severance, restructuring, and acquisition integration costs | (0.06) | (0.06) | ||
Purchase accounting effects of acquisitions | (0.03) | (0.03) | ||
GAAP income per diluted share attributable to Belden common stockholders | $3.84 - $4.49 | $0.23 - $0.43 |