Delaware | 001-12561 | 36-3601505 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common stock, $0.01 par value | BDC | New York Stock Exchange |
d) Exhibits. | ||
Exhibit Number | Description | |
99.1 |
BELDEN INC. | ||||||
Date: July 31, 2019 | 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 | |||||||||||||||
June 30, 2019 | July 1, 2018 | June 30, 2019 | July 1, 2018 | |||||||||||||
(In thousands, except per share data) | ||||||||||||||||
Revenues | $ | 637,530 | $ | 668,639 | $ | 1,224,705 | $ | 1,274,204 | ||||||||
Cost of sales | (396,507 | ) | (411,043 | ) | (758,954 | ) | (786,014 | ) | ||||||||
Gross profit | 241,023 | 257,596 | 465,751 | 488,190 | ||||||||||||
Selling, general and administrative expenses | (122,482 | ) | (138,842 | ) | (245,270 | ) | (263,714 | ) | ||||||||
Research and development expenses | (35,034 | ) | (37,209 | ) | (69,188 | ) | (74,310 | ) | ||||||||
Amortization of intangibles | (22,368 | ) | (25,039 | ) | (45,709 | ) | (49,457 | ) | ||||||||
Operating income | 61,139 | 56,506 | 105,584 | 100,709 | ||||||||||||
Interest expense, net | (14,168 | ) | (15,088 | ) | (28,361 | ) | (32,066 | ) | ||||||||
Non-operating pension benefit (cost) | 481 | (257 | ) | 1,028 | (532 | ) | ||||||||||
Loss on debt extinguishment | — | (3,030 | ) | — | (22,990 | ) | ||||||||||
Income before taxes | 47,452 | 38,131 | 78,251 | 45,121 | ||||||||||||
Income tax expense | (5,162 | ) | (9,339 | ) | (10,783 | ) | (13,759 | ) | ||||||||
Net income | 42,290 | 28,792 | 67,468 | 31,362 | ||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 90 | (77 | ) | 66 | (125 | ) | ||||||||||
Net income attributable to Belden | 42,200 | 28,869 | 67,402 | 31,487 | ||||||||||||
Less: Preferred stock dividends | 8,733 | 8,733 | 17,466 | 17,466 | ||||||||||||
Net income attributable to Belden common stockholders | $ | 33,467 | $ | 20,136 | $ | 49,936 | $ | 14,021 | ||||||||
Weighted average number of common shares and equivalents: | ||||||||||||||||
Basic | 39,389 | 40,735 | 39,405 | 41,184 | ||||||||||||
Diluted | 39,611 | 40,974 | 39,635 | 41,492 | ||||||||||||
Basic income per share attributable to Belden common stockholders: | $ | 0.85 | $ | 0.49 | $ | 1.27 | $ | 0.34 | ||||||||
Diluted income per share attributable to Belden common stockholders: | $ | 0.84 | $ | 0.49 | $ | 1.26 | $ | 0.34 | ||||||||
Common stock dividends declared per share | $ | 0.05 | $ | 0.05 | $ | 0.10 | $ | 0.10 |
Enterprise Solutions | Industrial Solutions | Total Segments | ||||||||||
(In thousands, except percentages) | ||||||||||||
For the three months ended June 30, 2019 | ||||||||||||
Segment Revenues | $ | 369,862 | $ | 267,668 | $ | 637,530 | ||||||
Segment EBITDA | 53,483 | 47,458 | 100,941 | |||||||||
Segment EBITDA margin | 14.5 | % | 17.7 | % | 15.8 | % | ||||||
Depreciation expense | 7,540 | 4,761 | 12,301 | |||||||||
Amortization of intangibles | 9,320 | 13,048 | 22,368 | |||||||||
Amortization of software development intangible assets | 1,044 | 28 | 1,072 | |||||||||
Severance, restructuring, and acquisition integration costs | 3,082 | — | 3,082 | |||||||||
Purchase accounting effects of acquisitions | 718 | — | 718 | |||||||||
For the three months ended July 1, 2018 | ||||||||||||
Segment Revenues | $ | 399,695 | $ | 271,746 | $ | 671,441 | ||||||
Segment EBITDA | 70,281 | 53,225 | 123,506 | |||||||||
Segment EBITDA margin | 17.6 | % | 19.6 | % | 18.4 | % | ||||||
Depreciation expense | 7,153 | 4,873 | 12,026 | |||||||||
Amortization of intangibles | 11,809 | 13,230 | 25,039 | |||||||||
Amortization of software development intangible assets | 488 | — | 488 | |||||||||
Severance, restructuring, and acquisition integration costs | 22,887 | 2,041 | 24,928 | |||||||||
Purchase accounting effects of acquisitions | 1,036 | — | 1,036 | |||||||||
Deferred revenue adjustments | 2,802 | — | 2,802 | |||||||||
For the six months ended June 30, 2019 | ||||||||||||
Segment Revenues | $ | 696,389 | $ | 528,316 | $ | 1,224,705 | ||||||
Segment EBITDA | 93,041 | 94,917 | 187,958 | |||||||||
Segment EBITDA margin | 13.4 | % | 18.0 | % | 15.3 | % | ||||||
Depreciation expense | 15,273 | 9,748 | 25,021 | |||||||||
Amortization of intangibles | 19,490 | 26,219 | 45,709 | |||||||||
Amortization of software development intangible assets | 1,958 | 51 | 2,009 | |||||||||
Severance, restructuring, and acquisition integration costs | 6,860 | — | 6,860 | |||||||||
Purchase accounting effects of acquisitions | 2,031 | — | 2,031 | |||||||||
For the six months ended July 1, 2018 | ||||||||||||
Segment Revenues | $ | 750,685 | $ | 528,179 | $ | 1,278,864 | ||||||
Segment EBITDA | 127,733 | 99,651 | 227,384 | |||||||||
Segment EBITDA margin | 17.0 | % | 18.9 | % | 17.8 | % | ||||||
Depreciation expense | 14,373 | 9,518 | 23,891 | |||||||||
Amortization of intangibles | 22,979 | 26,478 | 49,457 | |||||||||
Amortization of software development intangible assets | 724 | — | 724 | |||||||||
Severance, restructuring, and acquisition integration costs | 37,421 | 7,901 | 45,322 | |||||||||
Purchase accounting effects of acquisitions | 1,538 | — | 1,538 | |||||||||
Deferred revenue adjustments | 4,660 | — | 4,660 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | July 1, 2018 | June 30, 2019 | July 1, 2018 | |||||||||||||
(In thousands) | ||||||||||||||||
Total Segment Revenues | $ | 637,530 | $ | 671,441 | $ | 1,224,705 | $ | 1,278,864 | ||||||||
Deferred revenue adjustments | — | (2,802 | ) | — | (4,660 | ) | ||||||||||
Consolidated Revenues | $ | 637,530 | $ | 668,639 | $ | 1,224,705 | $ | 1,274,204 | ||||||||
Total Segment EBITDA | $ | 100,941 | $ | 123,506 | $ | 187,958 | $ | 227,384 | ||||||||
Eliminations | (261 | ) | (681 | ) | (744 | ) | (989 | ) | ||||||||
Total non-operating pension benefit (cost) | 481 | (257 | ) | 1,028 | (532 | ) | ||||||||||
Consolidated Adjusted EBITDA (1) | 101,161 | 122,568 | 188,242 | 225,863 | ||||||||||||
Amortization of intangibles | (22,368 | ) | (25,039 | ) | (45,709 | ) | (49,457 | ) | ||||||||
Interest expense, net | (14,168 | ) | (15,088 | ) | (28,361 | ) | (32,066 | ) | ||||||||
Depreciation expense | (12,301 | ) | (12,026 | ) | (25,021 | ) | (23,891 | ) | ||||||||
Severance, restructuring, and acquisition integration costs | (3,082 | ) | (24,928 | ) | (6,860 | ) | (45,322 | ) | ||||||||
Purchase accounting effects related to acquisitions | (718 | ) | (1,036 | ) | (2,031 | ) | (1,538 | ) | ||||||||
Amortization of software development intangible assets | (1,072 | ) | (488 | ) | (2,009 | ) | (724 | ) | ||||||||
Loss on debt extinguishment | — | (3,030 | ) | — | (22,990 | ) | ||||||||||
Deferred revenue adjustments | — | (2,802 | ) | — | (4,660 | ) | ||||||||||
Loss on sale of assets | — | — | — | (94 | ) | |||||||||||
Consolidated income before taxes | $ | 47,452 | $ | 38,131 | $ | 78,251 | $ | 45,121 |
(1) | Consolidated Adjusted EBITDA is a non-GAAP measure. See Reconciliation of Non-GAAP Measures for additional information. |
June 30, 2019 | December 31, 2018 | |||||||
(Unaudited) | ||||||||
(In thousands) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 295,243 | $ | 420,610 | ||||
Receivables, net | 451,487 | 465,939 | ||||||
Inventories, net | 309,711 | 316,418 | ||||||
Other current assets | 60,017 | 55,757 | ||||||
Total current assets | 1,116,458 | 1,258,724 | ||||||
Property, plant and equipment, less accumulated depreciation | 383,067 | 365,970 | ||||||
Operating lease right-of-use assets | 84,099 | — | ||||||
Goodwill | 1,607,848 | 1,557,653 | ||||||
Intangible assets, less accumulated amortization | 506,706 | 511,093 | ||||||
Deferred income taxes | 90,112 | 56,018 | ||||||
Other long-lived assets | 34,690 | 29,863 | ||||||
$ | 3,822,980 | $ | 3,779,321 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 266,897 | $ | 352,646 | ||||
Accrued liabilities | 323,124 | 364,276 | ||||||
Total current liabilities | 590,021 | 716,922 | ||||||
Long-term debt | 1,457,571 | 1,463,200 | ||||||
Postretirement benefits | 131,023 | 132,791 | ||||||
Deferred income taxes | 79,224 | 39,943 | ||||||
Long-term operating lease liabilities | 77,679 | — | ||||||
Other long-term liabilities | 53,929 | 38,877 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock | 1 | 1 | ||||||
Common stock | 503 | 503 | ||||||
Additional paid-in capital | 1,143,494 | 1,139,395 | ||||||
Retained earnings | 967,970 | 922,000 | ||||||
Accumulated other comprehensive loss | (62,591 | ) | (74,907 | ) | ||||
Treasury stock | (621,167 | ) | (599,845 | ) | ||||
Total Belden stockholders’ equity | 1,428,210 | 1,387,147 | ||||||
Noncontrolling interests | 5,323 | 441 | ||||||
Total stockholders’ equity | 1,433,533 | 1,387,588 | ||||||
$ | 3,822,980 | $ | 3,779,321 |
Six Months Ended | ||||||||
June 30, 2019 | July 1, 2018 | |||||||
(In thousands) | ||||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 67,468 | 31,362 | |||||
Adjustments to reconcile net income to net cash provided by (used for) operating activities: | ||||||||
Depreciation and amortization | 72,739 | 74,072 | ||||||
Share-based compensation | 7,594 | 7,868 | ||||||
Loss on debt extinguishment | — | 22,990 | ||||||
Changes in operating assets and liabilities, net of the effects of currency exchange rate changes and acquired businesses: | ||||||||
Receivables | 20,329 | (12,370 | ) | |||||
Inventories | 17,351 | (14,486 | ) | |||||
Accounts payable | (91,542 | ) | (84,689 | ) | ||||
Accrued liabilities | (59,410 | ) | (30,351 | ) | ||||
Income taxes | (12,361 | ) | (4,142 | ) | ||||
Other assets | 5,092 | (17,275 | ) | |||||
Other liabilities | (5,615 | ) | (2,341 | ) | ||||
Net cash provided by (used for) operating activities | 21,645 | (29,362 | ) | |||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (50,769 | ) | (39,493 | ) | ||||
Cash used to acquire businesses, net of cash acquired | (50,517 | ) | (84,580 | ) | ||||
Proceeds from disposal of tangible assets | 19 | 1,517 | ||||||
Proceeds from disposal of business | — | 40,171 | ||||||
Net cash used for investing activities | (101,267 | ) | (82,385 | ) | ||||
Cash flows from financing activities: | ||||||||
Payments under share repurchase program | (22,815 | ) | (100,000 | ) | ||||
Cash dividends paid | (21,448 | ) | (22,034 | ) | ||||
Withholding tax payments for share-based payment awards | (2,002 | ) | (1,579 | ) | ||||
Other | (173 | ) | — | |||||
Payments under borrowing arrangements | — | (484,757 | ) | |||||
Debt issuance costs paid | — | (7,469 | ) | |||||
Redemption of stockholders' rights agreement | — | (411 | ) | |||||
Borrowings under credit arrangements | — | 431,270 | ||||||
Net cash used for financing activities | (46,438 | ) | (184,980 | ) | ||||
Effect of foreign currency exchange rate changes on cash and cash equivalents | 693 | (2,932 | ) | |||||
Decrease in cash and cash equivalents | (125,367 | ) | (299,659 | ) | ||||
Cash and cash equivalents, beginning of period | 420,610 | 561,108 | ||||||
Cash and cash equivalents, end of period | $ | 295,243 | $ | 261,449 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | July 1, 2018 | June 30, 2019 | July 1, 2018 | |||||||||||||
(In thousands, except percentages and per share amounts) | ||||||||||||||||
GAAP revenues | $ | 637,530 | $ | 668,639 | $ | 1,224,705 | $ | 1,274,204 | ||||||||
Deferred revenue adjustments | — | 2,802 | — | 4,660 | ||||||||||||
Adjusted revenues | $ | 637,530 | $ | 671,441 | $ | 1,224,705 | $ | 1,278,864 | ||||||||
GAAP gross profit | $ | 241,023 | $ | 257,596 | $ | 465,751 | $ | 488,190 | ||||||||
Severance, restructuring, and acquisition integration costs | 423 | 7,231 | 985 | 16,662 | ||||||||||||
Deferred revenue adjustments | — | 2,802 | — | 4,660 | ||||||||||||
Purchase accounting effects related to acquisitions | 718 | 773 | 718 | 1,275 | ||||||||||||
Amortization of software development intangible assets | 1,072 | 488 | 2,009 | 724 | ||||||||||||
Adjusted gross profit | $ | 243,236 | $ | 268,890 | $ | 469,463 | $ | 511,511 | ||||||||
GAAP gross profit margin | 37.8 | % | 38.5 | % | 38.0 | % | 38.3 | % | ||||||||
Adjusted gross profit margin | 38.2 | % | 40.0 | % | 38.3 | % | 40.0 | % | ||||||||
GAAP selling, general and administrative expenses | $ | (122,482 | ) | $ | (138,842 | ) | $ | (245,270 | ) | $ | (263,714 | ) | ||||
Severance, restructuring, and acquisition integration costs | 2,335 | 14,544 | 5,111 | 23,946 | ||||||||||||
Purchase accounting effects related to acquisitions | — | 263 | 1,313 | 263 | ||||||||||||
Loss on sale of assets | — | — | — | 94 | ||||||||||||
Adjusted selling, general and administrative expenses | $ | (120,147 | ) | $ | (124,035 | ) | $ | (238,846 | ) | $ | (239,411 | ) | ||||
GAAP research and development expenses | $ | (35,034 | ) | $ | (37,209 | ) | $ | (69,188 | ) | $ | (74,310 | ) | ||||
Severance, restructuring, and acquisition integration costs | 326 | 3,153 | 763 | 4,714 | ||||||||||||
Adjusted research and development expenses | $ | (34,708 | ) | $ | (34,056 | ) | $ | (68,425 | ) | $ | (69,596 | ) | ||||
GAAP net income attributable to Belden | $ | 42,200 | $ | 28,869 | $ | 67,402 | $ | 31,487 | ||||||||
Interest expense, net | 14,168 | 15,088 | 28,361 | 32,066 | ||||||||||||
Income tax expense | 5,162 | 9,339 | 10,783 | 13,759 | ||||||||||||
Loss on debt extinguishment | — | 3,030 | — | 22,990 | ||||||||||||
Non-controlling interests | 90 | (77 | ) | 66 | (125 | ) | ||||||||||
Total non-operating adjustments | 19,420 | 27,380 | 39,210 | 68,690 | ||||||||||||
Amortization of intangible assets | 22,368 | 25,039 | 45,709 | 49,457 | ||||||||||||
Severance, restructuring, and acquisition integration costs | 3,082 | 24,928 | 6,860 | 45,322 | ||||||||||||
Purchase accounting effects related to acquisitions | 718 | 1,036 | 2,031 | 1,538 | ||||||||||||
Amortization of software development intangible assets | 1,072 | 488 | 2,009 | 724 | ||||||||||||
Deferred revenue adjustments | — | 2,802 | — | 4,660 | ||||||||||||
Loss on sale of assets | — | — | — | 94 | ||||||||||||
Total operating income adjustments | 27,240 | 54,293 | 56,609 | 101,795 | ||||||||||||
Depreciation expense | 12,301 | 12,026 | 25,021 | 23,891 | ||||||||||||
Adjusted EBITDA | $ | 101,161 | $ | 122,568 | $ | 188,242 | $ | 225,863 | ||||||||
GAAP net income margin | 6.6 | % | 4.3 | % | 5.5 | % | 2.5 | % | ||||||||
Adjusted EBITDA margin | 15.9 | % | 18.3 | % | 15.4 | % | 17.7 | % | ||||||||
GAAP net income attributable to Belden | $ | 42,200 | $ | 28,869 | $ | 67,402 | $ | 31,487 | ||||||||
Operating income adjustments from above | 27,240 | 54,293 | 56,609 | 101,795 | ||||||||||||
Loss on debt extinguishment | — | 3,030 | — | 22,990 | ||||||||||||
Tax effect of adjustments above | (5,053 | ) | (13,577 | ) | (11,472 | ) | (25,689 | ) | ||||||||
Impact of Tax Cuts and Jobs Act enactment | — | — | — | (473 | ) | |||||||||||
Amortization expense attributable to noncontrolling interest, net of tax | — | (16 | ) | — | (33 | ) | ||||||||||
Adjusted net income attributable to Belden | $ | 64,387 | $ | 72,599 | $ | 112,539 | $ | 130,077 | ||||||||
GAAP net income attributable to Belden | $ | 42,200 | $ | 28,869 | $ | 67,402 | $ | 31,487 | ||||||||
Less: Preferred stock dividends | 8,733 | 8,733 | 17,466 | 17,466 | ||||||||||||
GAAP net income attributable to Belden common stockholders | $ | 33,467 | $ | 20,136 | $ | 49,936 | $ | 14,021 | ||||||||
Adjusted net income attributable to Belden | $ | 64,387 | $ | 72,599 | $ | 112,539 | $ | 130,077 | ||||||||
Less: Preferred stock dividends | — | — | 17,466 | — | ||||||||||||
Adjusted net income attributable to Belden common stockholders | $ | 64,387 | $ | 72,599 | $ | 95,073 | $ | 130,077 | ||||||||
GAAP income per diluted share attributable to Belden common stockholders | $ | 0.84 | $ | 0.49 | $ | 1.26 | $ | 0.34 | ||||||||
Adjusted income per diluted share attributable to Belden common stockholders | $ | 1.39 | $ | 1.52 | $ | 2.40 | $ | 2.69 | ||||||||
GAAP diluted weighted average shares | 39,611 | 40,974 | 39,635 | 41,492 | ||||||||||||
Adjustment for assumed conversion of preferred stock into common stock | 6,857 | 6,857 | — | 6,857 | ||||||||||||
Adjusted diluted weighted average shares | 46,468 | 47,831 | 39,635 | 48,349 |
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, 2019 | July 1, 2018 | June 30, 2019 | July 1, 2018 | |||||||||||||
(In thousands) | ||||||||||||||||
GAAP net cash provided by (used for) operating activities | $ | 67,705 | $ | 54,498 | $ | 21,645 | $ | (29,362 | ) | |||||||
Capital expenditures, net of proceeds from the disposal of tangible assets | (27,165 | ) | (22,101 | ) | (50,750 | ) | (37,976 | ) | ||||||||
Non-GAAP free cash flow | $ | 40,540 | $ | 32,397 | $ | (29,105 | ) | $ | (67,338 | ) |
Year Ended December 31, 2019 | Three Months Ended September 29, 2019 | |||
Adjusted income per diluted share attributable to Belden common stockholders | $5.38 - $5.78 | $1.32 - $1.52 | ||
Amortization of intangible assets | (1.69) | (0.41) | ||
Severance, restructuring, and acquisition integration costs | (0.20) | (0.06) | ||
Purchase accounting effects of acquisitions | (0.05) | (0.01) | ||
GAAP income per diluted share attributable to Belden common stockholders | $3.44 - $3.84 | $0.84 - $1.04 |