EX-99.1 2 d529208dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO   

7733 Forsyth Boulevard

Suite 800

St. Louis, Missouri 63105

  

Phone: 314.854.8000

Fax: 314.854.8003

 

www.Belden.com

  

News Release

        

Belden Reports Strong Results in First Quarter 2013

St. Louis, Missouri – May 2, 2013 – Belden Inc. (NYSE: BDC), a global leader in signal transmission solutions for mission-critical applications, today reported fiscal first quarter 2013 results for the period ended March 31, 2013.

First Quarter Highlights

 

   

Grew revenue by 15.4% year-over-year;

 

   

Improved adjusted operating income margin to 13.1%, increasing 400 basis points from 9.1% in the year-ago period;

 

   

Increased adjusted income from continuing operations per diluted share to $0.84, up 82.6% over last year’s $0.46 per diluted share;

 

   

Purchased 612,982 shares of Belden common stock for $31.25 million during the quarter, bringing the total program-to-date shares repurchased to 4.32 million shares under both the previously announced program and recently announced extension, and

 

   

Raised full-year guidance for fiscal 2013 adjusted income from continuing operations per diluted share to $3.49 – $3.69.

First Quarter 2013

Revenue for the quarter totaled $507.5 million, up $67.9 million, or 15.4%, compared to $439.6 million in the first quarter 2012. Operating income margin in the first quarter was 8.7%, increasing 30 basis points from 8.4% in the year-ago period. Income from continuing operations per diluted share totaled $0.49, compared to $0.42 in the first quarter 2012, a year-over-year increase of 16.7%.

Adjusted revenue for the quarter totaled $510.4 million, up $70.8 million, or 16.1%, compared to $439.6 million in the first quarter 2012. On an organic basis, revenue was down slightly compared to the same period last year. Adjusted income from continuing operations per diluted share totaled $0.84, compared to $0.46 in the first quarter 2012, an increase of 82.6%. A non-GAAP reconciliation table is provided as an appendix to this release.

John Stroup, President and CEO of Belden Inc., said, “We’re pleased with our strong start to the year. As expected, our two industrial platforms performed well in the quarter, and they more than offset demand weakness in our European and enterprise markets. Year-over-year operating income margin expansion is a clear highlight and a direct result of our business transformation and commitment to continuous improvement.”

Outlook

“Although the global macroeconomic environment has proven challenging and difficult to predict, we feel confident that our portfolio, business system, and focus on execution provide a level of stability and predictability. Therefore, we are increasing our earnings outlook for the full year,” said Mr. Stroup.


Belden Reports Strong Results in First Quarter 2013 – Page 2 of 3

 

Belden is now organized around four new global business segments: Broadcast, Enterprise Connectivity, Industrial Connectivity, and Industrial IT. Management believes that this will allow the Company to better execute its strategic plan, which includes the Market Delivery System and Lean Enterprise.

The Company expects second quarter 2013 revenues to be $530 – $540 million and adjusted income from continuing operations per diluted share to be $0.90 – $0.95. For the full year ending December 31, 2013, the Company expects revenues to be $2.07 – $2.12 billion and adjusted income from continuing operations per diluted share to be $3.49 – $3.69.

Earnings Conference Call

Management will host a conference call today at 10:30 a.m. Eastern to discuss results of the quarter. The listen-only audio of the conference call will be broadcast live via the Internet at http://investor.belden.com. The dial-in number for participants in the U.S. is 888-599-8685; the dial-in number for participants outside the U.S. is 913-312-0403. A replay of this conference call will remain accessible in the investor relations section of the Company’s website for a limited time.

Use of Non-GAAP Financial Information

Adjusted results are non-GAAP measures that reflect certain adjustments the Company makes to provide insight into operating results. All GAAP to non-GAAP reconciliations accompany the consolidated financial statements included in this release and have been published to the investor relations section of the Company’s website at http://investor.belden.com.

Forward Looking Statements

Statements in this release other than historical facts are “forward looking statements” made in reliance upon the safe harbor of the Private Securities Litigation Reform Act of 1995. Forward looking statements include any statements regarding future revenues, costs and expenses, operating income, earnings per share, margins, cash flows, dividends, and capital expenditures. These forward looking statements are based on forecasts and projections about the markets and industries served by the Company and about general economic conditions. They reflect management’s beliefs and expectations. They are not guarantees of future performance and they involve risk and uncertainty. The Company’s actual results may differ materially from these expectations. Changes in the global economy may impact the Company’s results. Turbulence in financial markets may increase the Company’s borrowing costs. Additional factors that may cause actual results to differ from the Company’s expectations include: the Company’s reliance on key distributors in marketing products; the Company’s ability to execute and realize the expected benefits from strategic initiatives (including revenue growth, cost control, and productivity improvement programs); changes in the level of economic activity in the Company’s major geographic markets; difficulties in realigning manufacturing capacity and capabilities among the Company’s global manufacturing facilities; the competitiveness of the global broadcast, enterprise, and industrial markets; variability in the Company’s quarterly and annual effective tax rates; changes in accounting rules and interpretation of these rules which


Belden Reports Strong Results in First Quarter 2013 – Page 3 of 3

 

may affect the Company’s reported earnings; changes in currency exchange rates and political and economic uncertainties in the countries where the Company conducts business; demand for the Company’s products; the cost and availability of materials including copper, plastic compounds derived from fossil fuels, electronic components, and other materials; energy costs; the Company’s ability to achieve acquisition performance expectations and to integrate acquired businesses successfully; the ability of the Company to develop and introduce new products; the Company having to recognize charges that would reduce income as a result of impairing goodwill and other intangible assets; security risks and the potential for business interruption from operating in volatile countries; disruptions or failures of the Company’s (or the Company’s suppliers or customers) systems or operations in the event of a major earthquake, weather event, cyber-attack, terrorist attack, or other catastrophic event that could cause delays in completing sales, providing services, or performing other mission-critical functions; and other factors. For a more complete discussion of risk factors, please see our Annual Report on Form 10-K for the year ended December 31, 2012, filed with the SEC on February 28, 2013. Belden disclaims any duty to update any forward looking statements as a result of new information, future developments, or otherwise.

About Belden

Belden Inc., a global leader in high quality, end-to-end signal transmission solutions, delivers a comprehensive product portfolio designed to meet the mission-critical network infrastructure needs of industrial, enterprise and broadcast markets. With innovation solutions targeted at reliable and secure transmission of rapidly growing amounts of data, audio and video needed for today’s applications, Belden is at the center of the global transformation to a connected world. Founded in 1902, the company is headquartered in St. Louis and has manufacturing capabilities in North and South America, Europe and Asia. For more information, visit us at www.belden.com; follow us on Twitter @BeldenInc.

Contact:

Belden Investor Relations

314-854-8054

Investor.Relations@Belden.com


BELDEN INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE INCOME

(Unaudited)

 

     Three Months Ended  
     March 31, 2013     April 1, 2012  
     (In thousands, except per share amounts)  

Revenues

   $ 507,473      $ 439,600   

Cost of sales

     (340,120     (306,801
  

 

 

   

 

 

 

Gross profit

     167,353        132,799   

Selling, general and administrative expenses

     (91,982     (81,522

Research and development

     (20,425     (13,808

Amortization of intangibles

     (12,977     (3,084

Income from equity method investment

     2,271        2,741   
  

 

 

   

 

 

 

Operating income

     44,240        37,126   

Interest expense

     (15,905     (11,919

Interest income

     108        351   
  

 

 

   

 

 

 

Income from continuing operations before taxes

     28,443        25,558   

Income tax expense

     (6,198     (5,819
  

 

 

   

 

 

 

Income from continuing operations

     22,245        19,739   

Income from discontinued operations, net of tax

     —          4,536   
  

 

 

   

 

 

 

Net income

   $ 22,245      $ 24,275   
  

 

 

   

 

 

 

Weighted average number of common shares and equivalents:

    

Basic

     44,420        45,912   

Diluted

     45,427        46,938   

Basic income per share

    

Continuing operations

   $ 0.50      $ 0.43   

Discontinued operations

     —          0.10   
  

 

 

   

 

 

 

Net income

   $ 0.50      $ 0.53   
  

 

 

   

 

 

 

Diluted income per share

    

Continuing operations

   $ 0.49      $ 0.42   

Discontinued operations

     —          0.10   
  

 

 

   

 

 

 

Net income

   $ 0.49      $ 0.52   
  

 

 

   

 

 

 

Comprehensive income

   $ 14,892      $ 34,901   
  

 

 

   

 

 

 

Dividends declared per share

   $ 0.05      $ 0.05   


BELDEN INC.

OPERATING SEGMENT INFORMATION

(Unaudited)

 

     Three months ended  
     March 31, 2013     April 1, 2012  
     (In thousands)  

External customer revenues:

    

Broadcast Solutions

   $ 155,586      $ 70,057   

Enterprise Connectivity Solutions

     116,627        124,352   

Industrial Connectivity Solutions

     176,721        169,633   

Industrial IT Solutions

     58,539        50,882   

All other

     —          24,676   
  

 

 

   

 

 

 

Consolidated

   $ 507,473      $ 439,600   
  

 

 

   

 

 

 

Operating income (loss):

    

Broadcast Solutions

   $ (146   $ 1,168   

Enterprise Connectivity Solutions

     8,835        9,752   

Industrial Connectivity Solutions

     24,449        18,973   

Industrial IT Solutions

     9,517        5,713   

All other

     —         (542
  

 

 

   

 

 

 

Total segments

     42,655        35,064   

Eliminations

     (686     (679

Income from equity method investment

     2,271        2,741   
  

 

 

   

 

 

 

Consolidated

   $ 44,240      $ 37,126   
  

 

 

   

 

 

 


BELDEN INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

     March 31, 2013     December 31, 2012  
     (Unaudited)        
     (In thousands)  
ASSETS     

Current assets:

    

Cash and cash equivalents

   $ 469,406      $ 395,095   

Receivables, net

     301,400        300,864   

Inventories, net

     219,068        215,282   

Deferred income taxes

     17,903        19,885   

Other current assets

     23,013        28,456   
  

 

 

   

 

 

 

Total current assets

     1,030,790        959,582   

Property, plant and equipment, less accumulated depreciation

     302,767        307,048   

Goodwill

     778,989        778,708   

Intangible assets, less accumulated amortization

     417,390        428,273   

Deferred income taxes

     45,745        46,970   

Other long-lived assets

     72,298        64,002   
  

 

 

   

 

 

 
   $ 2,647,979      $ 2,584,583   
  

 

 

   

 

 

 
LIABILITIES AND STOCKHOLDERS’ EQUITY     

Current liabilities:

    

Accounts payable

   $ 191,376      $ 183,672   

Accrued liabilities

     138,287        166,272   

Current maturities of long-term debt

     15,328        15,678   

Current liabilities of discontinued operations

     —          86,860   
  

 

 

   

 

 

 

Total current liabilities

     344,991        452,482   

Long-term debt

     1,317,997        1,135,527   

Postretirement benefits

     140,690        144,320   

Other long-term liabilities

     41,842        40,394   

Stockholders’ equity:

    

Common stock

     503        503   

Additional paid-in capital

     593,010        598,180   

Retained earnings

     481,750        461,756   

Accumulated other comprehensive loss

     (37,918     (30,565

Treasury stock

     (234,886     (218,014
  

 

 

   

 

 

 

Total stockholders’ equity

     802,459        811,860   
  

 

 

   

 

 

 
   $ 2,647,979      $ 2,584,583   
  

 

 

   

 

 

 


BELDEN INC.

CONDENSED CONSOLIDATED CASH FLOW STATEMENTS

(Unaudited)

 

     Three Months Ended  
     March 31, 2013     April 1, 2012  
     (In thousands)  

Cash flows from operating activities:

    

Net income

   $ 22,245      $ 24,275   

Adjustments to reconcile net income to net cash provided by (used for) operating activities:

    

Depreciation and amortization

     22,546        12,157   

Share-based compensation

     3,419        2,977   

Provision for inventory obsolescence

     474        2,491   

Pension funding less than pension expense

     798        756   

Income from equity method investment

     (2,271     (2,741

Tax benefit related to share-based compensation

     (4,227     (4,119

Changes in operating assets and liabilities, net of the effects of currency exchange rate changes and acquired businesses:

    

Receivables

     (9,785     11,904   

Inventories

     (2,723     (4

Accounts payable

     5,520        (5,634

Accrued liabilities

     (30,347     (30,141

Accrued taxes

     (69,987     5,105   

Other assets

     (5,606     (215

Other liabilities

     (1,782     (4,063
  

 

 

   

 

 

 

Net cash provided by (used for) operating activities

     (71,726     12,748   

Cash flows from investing activities:

    

Cash used to acquire businesses, net of cash acquired

     (9,475     (587

Capital expenditures

     (6,437     (7,557

Proceeds from disposal of businesses

     3,735        —     

Proceeds from disposal of tangible assets

     1,077        —     
  

 

 

   

 

 

 

Net cash used for investing activities

     (11,100     (8,144

Cash flows from financing activities:

    

Borrowings under credit arrangements

     388,220        —     

Payments under borrowing arrangements

     (194,110     (600

Payments under share repurchase program

     (31,250     (25,000

Debt issuance costs paid

     (6,794     —     

Cash dividends paid

     (76     (2,409

Proceeds from exercise of stock options, net of withholding tax

     1,551        2,179   

Tax benefit related to share-based compensation

     4,227        4,119   
  

 

 

   

 

 

 

Net cash provided by (used for) financing activities

     161,768        (21,711

Effect of foreign currency exchange rate changes on cash and cash equivalents

     (4,631     4,408   
  

 

 

   

 

 

 

Increase (decrease) in cash and cash equivalents

     74,311        (12,699

Cash and cash equivalents, beginning of period

     395,095        382,716   
  

 

 

   

 

 

 

Cash and cash equivalents, end of period

   $ 469,406      $ 370,017   
  

 

 

   

 

 

 


BELDEN INC.

RECONCILIATION OF NON-GAAP MEASURES

(Unaudited)

We define free cash flow, which is a non-GAAP financial measure, as net cash provided by operating activities adjusted for acquisition and divestiture transaction costs, capital expenditures net of the proceeds from the disposal of tangible assets, and non-recurring tax payments related to divestitures and settlement of a tax sharing agreement. We believe free cash flow provides useful information to investors regarding our ability to generate cash from business operations that is available for acquisitions and other investments, service of debt principal, dividends and share repurchases. We use free cash flow, as defined, as one financial measure to monitor and evaluate performance and liquidity. Non-GAAP financial measures should be considered only in conjunction with financial measures reported according to accounting principles generally accepted in the United States. Our definition of free cash flow may differ from definitions used by other companies.

 

     Three Months Ended
March 31, 2013
    Three Months Ended
April 1, 2012
 
     (In thousands)  

GAAP net cash provided by (used for) operating activities

   $ (71,726   $ 12,748   

Capital expenditures, net of proceeds from the disposal of tangible assets

     (5,360     (7,557

Non-recurring tax payments made for gain on 2012 sale of Thermax and Raydex cable business

     38,453        —     

Non-recurring tax payments made in settlement of tax sharing agreement with Cooper Industries

     30,000        —     
  

 

 

   

 

 

 

Non-GAAP free cash flow

   $ (8,633   $ 5,191   
  

 

 

   

 

 

 


BELDEN INC.

RECONCILIATION OF NON-GAAP MEASURES

(Unaudited)

In addition to reporting financial results in accordance with accounting principles generally accepted in the United States, we provide non-GAAP operating results adjusted for certain items including asset impairments, purchase accounting effects related to acquisitions, acquisition and divestiture transaction costs, revenue and cost of sales deferrals, severance and other restructuring costs, gains (losses) recognized on the disposal of businesses and tangible assets, amortization of intangible assets, gains (losses) on debt extinguishment, and other costs. We utilize the adjusted results to review our ongoing operations without the effect of these adjustments and for comparison to budgeted operating results. We believe the adjusted results are useful to investors because they help them compare our results to previous periods and provide important insights into underlying trends in the business and how management oversees our business operations on a day-to-day basis. Adjusted results should be considered only in conjunction with results reported according to accounting principles generally accepted in the United States.

 

     Three Months Ended  
     March 31, 2013     April 1, 2012  
     (In thousands, except percentages
and per share amounts)
 

GAAP revenues

   $ 507,473      $ 439,600   

Deferred revenue adjustments

     2,916        —    
  

 

 

   

 

 

 

Adjusted revenues

   $ 510,389      $ 439,600   
  

 

 

   

 

 

 

GAAP gross profit

   $ 167,353      $ 132,799   

Purchase accounting effects related to acquisitions

     6,550        —     

Deferred gross profit adjustments

     2,127        —     

Severance and other restructuring costs

     109        —     
  

 

 

   

 

 

 

Adjusted gross profit

   $ 176,139      $ 132,799   
  

 

 

   

 

 

 

Adjusted gross profit margin

     34.5     30.2

GAAP operating income

   $ 44,240      $ 37,126   

Amortization of intangible assets

     12,977        3,084   

Purchase accounting effects related to acquisitions

     6,550        —     

Deferred gross profit adjustments

     2,127        —     

Severance and other restructuring costs

     788        —     
  

 

 

   

 

 

 

Total operating income adjustments

     22,442        3,084   
  

 

 

   

 

 

 

Adjusted operating income

   $ 66,682      $ 40,210   
  

 

 

   

 

 

 

Adjusted operating income margin

     13.1     9.1

GAAP income from continuing operations

   $ 22,245      $ 19,739   

Operating income adjustments from above

     22,442        3,084   

Tax effect of adjustments

     (6,361     (1,025
  

 

 

   

 

 

 

Adjusted income from continuing operations

   $ 38,326      $ 21,798   
  

 

 

   

 

 

 

GAAP income from continuing operations per diluted share

   $ 0.49      $ 0.42   

Adjusted income from continuing operations per diluted share

   $ 0.84      $ 0.46   

GAAP and Adjusted diluted weighted average shares

     45,427        46,938   


BELDEN INC.

RECONCILIATION OF NON-GAAP MEASURES

(Unaudited)

In addition to reporting financial results in accordance with accounting principles generally accepted in the United States, we provide non-GAAP operating results adjusted for certain items including asset impairments, purchase accounting effects related to acquisitions, acquisition and divestiture transaction costs, revenue and cost of sales deferrals, severance and other restructuring costs, gains (losses) recognized on the disposal of businesses and tangible assets, amortization of intangible assets, gains (losses) on debt extinguishment, and other costs. We utilize the adjusted results to review our ongoing operations without the effect of these adjustments and for comparison to budgeted operating results. We believe the adjusted results are useful to investors because they help them compare our results to previous periods and provide important insights into underlying trends in the business and how management oversees our business operations on a day-to-day basis. Adjusted results should be considered only in conjunction with results reported according to accounting principles generally accepted in the United States.

 

     Three Months Ended March 31, 2013  
     Broadcast
Solutions
    Enterprise
Connectivity
Solutions
    Industrial
Connectivity
Solutions
    Industrial IT
Solutions
    All
Other
    Total
Segments
    Eliminations     Income from
equity method
investment
     Consolidated  

GAAP revenues

   $ 155,586      $ 116,627      $ 176,721      $ 58,539      $ —        $ 507,473      $ —        $ —         $ 507,473   

Deferred revenue adjustments

     2,916        —          —          —          —          2,916        —          —           2,916   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Adjusted revenues

   $ 158,502      $ 116,627      $ 176,721      $ 58,539      $ —        $ 510,389      $ —        $ —         $ 510,389   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

GAAP operating income

   $ (146   $ 8,835      $ 24,449      $ 9,517      $ —        $ 42,655      $ (686   $ 2,271       $ 44,240   

Amortization of intangible assets

     11,798        104        280        795        —          12,977        —          —           12,977   

Purchase accounting effects related to acquisitions

     6,550        —          —          —          —          6,550        —          —           6,550   

Deferred gross profit adjustments

     2,127        —          —          —          —          2,127        —          —           2,127   

Severance and other restructuring costs

     788        —          —          —          —          788        —          —           788   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Total operating income adjustments

     21,263        104        280        795        —          22,442        —          —           22,442   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Adjusted operating income

   $ 21,117      $ 8,939      $ 24,729      $ 10,312      $ —        $ 65,097      $ (686   $ 2,271       $ 66,682   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Adjusted operating income margin

     13.3     7.7     14.0     17.6       12.8          13.1
     Three Months Ended April 1, 2012  
     Broadcast
Solutions
    Enterprise
Connectivity
Solutions
    Industrial
Connectivity
Solutions
    Industrial IT
Solutions
    All
Other
    Total
Segments
    Eliminations     Income from
equity method
investment
     Consolidated  

GAAP revenues

   $ 70,057      $ 124,352      $ 169,633      $ 50,882      $ 24,676      $ 439,600      $ —        $ —         $ 439,600   

Deferred revenue adjustments

     —          —          —          —          —          —          —          —           —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Adjusted revenues

   $ 70,057      $ 124,352      $ 169,633      $ 50,882      $ 24,676      $ 439,600      $ —        $ —         $ 439,600   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

GAAP operating income (loss)

   $ 1,168      $ 9,752      $ 18,973      $ 5,713      $ (542   $ 35,064      $ (679   $ 2,741       $ 37,126   

Amortization of intangible assets

     1,029        122        770        812        351        3,084        —          —           3,084   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Total operating income adjustments

     1,029        122        770        812        351        3,084        —          —           3,084   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Adjusted operating income (loss)

   $ 2,197      $ 9,874      $ 19,743      $ 6,525      $ (191   $ 38,148      $ (679   $ 2,741       $ 40,210   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Adjusted operating income margin

     3.1     7.9     11.6     12.8     -0.8     8.7          9.1


BELDEN INC.

RECONCILIATION OF NON-GAAP MEASURES

2013 EARNINGS GUIDANCE

 

     Year Ended
December 31, 2013
  Three Months Ended
June 30, 2013

Non-GAAP income from continuing operations per diluted share

   $3.49 - $3.69   $0.90 - $0.95

Amortization of intangible assets

   $(0.81)   $(0.20)

Purchase accounting effects related to Miranda, PPC, and Softel acquisitions

   $(0.17)   $(0.02)

Deferred gross profit adjustments

   $(0.14)   $(0.04)

Plant consolidation costs

   $(0.13)   $(0.07)

Acquisition integration costs and the effects of the finalization of purchase accounting

   *   *

GAAP income from continuing operations per diluted share

   *   *

Our guidance for income from continuing operations per diluted share is based upon the extent of information currently available regarding events and conditions that will impact our future operating results for 2013. Our actual income from continuing operations per diluted share may be impacted by other additional events for which information is not available, such as asset impairments, purchase accounting effects related to acquisitions, severance and other restructuring costs, gains (losses) recognized on the disposal of tangible assets, gains (losses) on debt extinguishment, and other gains (losses) related to events or conditions that are not yet known.

 

* Integration costs and the effects of the finalization of purchase accounting related to recent acquisitions are not yet available.