Bel Third Quarter Sales Increase 54.5% to New Record; Net Earnings Are $0.12 Per Class A Share and $0.13 Per Class B Share
Non-GAAP Net Earnings Increase to
Third Quarter Highlights
-
Net sales increased 54.5% to
$156.3 million versus$101.2 million for last year's third quarter. -
GAAP net earnings were
$0.12 per Class A share and$0.13 per Class B share versus GAAP net earnings of$0.62 per Class A share and$0.65 per Class B share last year. -
Non-GAAP net earnings increased to
$0.63 per Class A share and$0.67 per Class B share versus non-GAAP net earnings of$0.54 per Class A share and$0.58 per Class B share last year. -
Non-GAAP income from operations increased 88.9% to
$13.7 million versus$7.2 for prior year.
CEO Comments
"Consistent with our plan, the 54.5% increase in third quarter revenue
primarily reflected sales of approximately
"Also consistent with our plan, the growth in revenue drove a
substantial increase in profitability measured on a non-GAAP basis. On a
comparable non-GAAP basis, operating income before restructuring charges
and acquisition costs nearly doubled to
"Power Solutions is a leading provider of high efficiency and high density power conversion products for server, storage and networking equipment, industrial applications and power systems. We are making progress in our program to renew the business's key customer relationships that had been allowed to atrophy by the former owner. Bel was recently approved, by two key customers, for consideration to bid on their new power product requirements. We have focused much of our attention on improving product quality at the Power Solutions China facility, and recent audits by customers support our positive results."
"We also are pleased with developments at CS, a leading provider of high performance RF/microwave and harsh environment optical connectors and assemblies for military, aerospace, wireless communications, data communications, broadcast and industrial applications. We have focused our initial efforts on maintaining operational efficiency and supply continuity with our customers and partners, while realigning our direct sales force to take advantage of synergies between CS and Bel's Cinch Connector Business."
"Within both of these new organizations, Bel has realigned the sales and marketing groups to focus on establishing strong relationships with our customer's product engineering and development groups."
Third Quarter Results
For the three months ended
Operating income for the third quarter of 2014 decreased to
Net earnings for the third quarter of 2014 were
Net earnings per diluted Class A common share for the third quarter of
2014 were
Net earnings per diluted Class B common share were
Nine Months Results
For the nine months ended
Net earnings per diluted Class A common share for the first nine months
of 2014 were
Net earnings per diluted Class B common share for the first nine months
of 2014 were
Balance Sheet Data
As of
Conference Call
Bel has scheduled a conference call at
About Bel
Bel (www.belfuse.com) is primarily engaged in the design, manufacture, and sale of products used in aerospace, data transmission, military, transportation, and consumer electronics. Bel's product groups include Magnetic Solutions (discrete components, power transformers and MagJack® connectors with integrated magnetics), Power Solutions and Protection (AC-DC power supplies, DC-DC converters, custom designs, miniature, micro, surface mount and resettable fuses) and Connectivity Solutions (micro, circular, filtered D Sub, fiber optic, RF connectors, microwave components, passive jacks, plugs and cable assemblies). The Company operates facilities around the world.
Forward-Looking Statements
Except for historical information contained in this press release,
the matters discussed in this press release (including the statements
regarding potential growth and opportunities to reduce costs and enhance
efficiency in the future) are forward-looking statements that involve
risks and uncertainties. Actual results could differ materially
from Bel's projections. Among the factors that could cause actual
results to differ materially from such statements are: the market
concerns facing our customers; the continuing viability of sectors that
rely on our products; the effects of business and economic conditions;
difficulties associated with integrating recently acquired companies;
capacity and supply constraints or difficulties; product development,
commercialization or technological difficulties; the regulatory and
trade environment; risks associated with foreign currencies;
uncertainties associated with legal proceedings; the market's acceptance
of the Company's new products and competitive responses to those new
products; and the risk factors detailed from time to time in the
Company's
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| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
| (000s omitted, except for per share data) | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
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|
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| 2014 | 2013* | 2014 | 2013* | ||||||||||||
| (unaudited) | (unaudited) | ||||||||||||||
| Net sales | $ | 156,341 | $ | 101,164 | $ | 338,426 | $ | 258,173 | |||||||
| Costs and expenses: | |||||||||||||||
| Cost of sales | 128,250 | 81,132 | 278,319 | 213,781 | |||||||||||
| Selling, general and administrative | 23,110 | 12,300 | 47,475 | 35,041 | |||||||||||
| Restructuring charges | 309 | -- | 1,365 | 1,387 | |||||||||||
| Total costs and expenses | 151,669 | 93,432 | 327,159 | 250,209 | |||||||||||
| Income from operations | 4,672 | 7,732 | 11,267 | 7,964 | |||||||||||
| Interest expense | (1,869 | ) | (67 | ) | (2,124 | ) | (75 | ) | |||||||
| Gain (loss) on sale of investment | -- | 98 | -- | 98 | |||||||||||
| Interest income and other, net | 21 | 81 | 121 | 188 | |||||||||||
| Earnings before provision (benefit) for income taxes | 2,824 | 7,844 | 9,264 | 8,175 | |||||||||||
| Provision (benefit) for income taxes | 1,316 | 464 | 2,189 | (336 | ) | ||||||||||
| Net earnings | $ | 1,507 | $ | 7,380 | $ | 7,075 | $ | 8,511 | |||||||
| Earnings per Class A common share - basic and diluted | $ | 0.12 | $ | 0.62 | $ | 0.57 | $ | 0.70 | |||||||
| Weighted average Class A common shares outstanding | |||||||||||||||
| - basic and diluted | 2,175 | 2,175 | 2,175 | 2,175 | |||||||||||
| Earnings per Class B common share - basic and diluted | $ | 0.13 | $ | 0.65 | $ | 0.62 | $ | 0.76 | |||||||
| Weighted average Class B common shares outstanding | |||||||||||||||
| - basic and diluted | 9,591 | 9,229 | 9,420 | 9,221 | |||||||||||
|
* Prior period amounts have been restated to reflect immaterial adjustments previously reported during the measurement period related to the 2012 acquisitions as if all such adjustments had been recognized on the dates of acquisition. |
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|
CONDENSED CONSOLIDATED BALANCE SHEETS |
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| (000s omitted) | |||||||||||||||
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| ASSETS | 2014 | 2013 |
LIABILITIES & EQUITY |
2014 | 2013 | ||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||
| Current assets | $ | 317,877 | $ | 204,155 | Notes payable and current | ||||||||||
| Property, plant & | maturities of long-term debt | $ | 12,257 | $ | 12,739 | ||||||||||
| equipment, net | 74,104 | 40,896 | Other current liabilities | 124,244 | 54,242 | ||||||||||
| Goodwill | Long-term debt | 223,219 | -- | ||||||||||||
| and intangibles | 214,375 | 47,962 | Other noncurrent liabilities | 49,786 | 12,458 | ||||||||||
| Other assets | 32,443 | 15,128 | Stockholders' equity | 229,293 | 228,702 | ||||||||||
| Total Assets | $ | 638,799 | $ | 308,141 | Total Liabilities & Equity | $ | 638,799 | $ | 308,141 | ||||||
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| NON-GAAP MEASURES (unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
| (000s omitted, except for per share data) | ||||||||||||||||||||||||||||||||||||||||||||||
|
Three Months Ended |
Nine Months Ended |
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|
Income from operations |
Net |
Net earnings per |
Net earnings per |
Income |
Net |
Net earnings per |
Net earnings per |
|||||||||||||||||||||||||||||||||||||||
| GAAP measures | $ | 4,672 | $ | 1,507 | $ | 0.12 | $ | 0.13 | $ | 11,267 | $ | 7,075 | $ | 0.57 | $ | 0.62 | ||||||||||||||||||||||||||||||
|
Restructuring charges, severance and reorganization costs |
||||||||||||||||||||||||||||||||||||||||||||||
| 503 | 312 | 0.03 | 0.03 | 1,616 | 1,002 | 0.08 | 0.09 | |||||||||||||||||||||||||||||||||||||||
|
Acquisition-related costs and inventory- related purchase accounting adjustments |
8,501 |
|
6,825 |
0.56 |
|
0.59 |
10,019 |
|
7,750 |
|
0.64 |
0.67 |
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|
|
|||||||||||||||||||||||||||||||||||||||||||||
| Expiration of tax statutes of limitations, net | -- | (825 | ) | (0.07 | ) | (0.07 | ) | -- | (825 | ) | (0.07 | ) | (0.07 | ) | ||||||||||||||||||||||||||||||||
| Non-GAAP measures(1) | $ | 13,676 | $ | 7,819 | $ | 0.63 | $ | 0.67 | $ | 22,902 | $ | 15,002 | $ | 1.23 | $ | 1.31 | ||||||||||||||||||||||||||||||
|
Three Months Ended |
Nine Months Ended |
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|
Income |
Net |
Net (loss) earnings |
Net (loss) earnings |
Income |
Net |
Net earnings per |
Net earnings per |
|||||||||||||||||||||||||||||||||||||||
| GAAP measures | $ | 7,732 | $ | 7,380 | $ | 0.62 | $ | 0.65 | $ | 7,964 | $ | 8,511 | $ | 0.70 | $ | 0.76 | ||||||||||||||||||||||||||||||
| Restructuring charges, severance and reorganization costs | ||||||||||||||||||||||||||||||||||||||||||||||
| 50 | 38 | -- | -- | 1,686 | 1,167 | 0.10 | 0.10 | |||||||||||||||||||||||||||||||||||||||
| Storm insurance recovery, net of costs | (689 | ) | (427 | ) | (0.04 | ) | (0.04 | ) | (689 | ) | (427 | ) | (0.04 | ) | (0.04 | ) | ||||||||||||||||||||||||||||||
| Acquisition and other related costs | 146 | 119 | 0.01 | 0.01 | 719 | 629 | 0.05 | 0.06 | ||||||||||||||||||||||||||||||||||||||
| Gain on sale of investment, net of income tax | -- | (61 | ) | (0.01 | ) | (0.01 | ) | -- | (61 | ) | (0.01 | ) | (0.01 | ) | ||||||||||||||||||||||||||||||||
| Restoration of expired prior year R&D credit | -- | -- | -- | -- | -- | (385 | ) | (0.03 | ) | (0.03 | ) | |||||||||||||||||||||||||||||||||||
| Expiration of tax statutes of limitations, net | -- | (529 | ) | (0.04 | ) | (0.05 | ) | -- | (529 | ) | (0.04 | ) | (0.05 | ) | ||||||||||||||||||||||||||||||||
| Non-GAAP measures(1) | $ | 7,239 | $ | 6,520 | $ | 0.54 | $ | 0.58 | $ | 9,680 | $ | 8,905 | $ | 0.74 | $ | 0.79 | ||||||||||||||||||||||||||||||
* Prior period amounts have been restated to reflect adjustments arising during the measurement period related to the 2012 and 2013 acquisitions as if all such adjustments had been recognized on the dates of acquisition.
(1) The non-GAAP measures presented above are not measures of
performance under accounting principles generally accepted in
Based upon discussions with investors and analysts, we believe that the reader's understanding of Bel's performance and profitability is enhanced by reference to these non-GAAP measures. Removal of amounts such as charges for restructuring, severance, and reorganization; costs and insurance recoveries related to Hurricane Sandy; acquisition-related costs; gains and losses related to investment securities; and fluctuations in tax-related reserves such as the FIN 48 liability facilitates comparison of our results among reporting periods. We believe that such amounts are not reflective of the relevant business in the period in which the gain or charge is recorded for accounting purposes.
(2) Net of income tax at effective rate in the applicable tax jurisdiction.
(3) Individual amounts of earnings per share may not agree to the total due to rounding.
Investor Contact:
310-477-3118
info@berkmanassociates.com
or
Company
Contact:
201-432-0463
President
ir@belf.com
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