Amphenol | News Release |
|
|
P. O. Box 5030
Wallingford, CT 06492-7530
Telephone (203) 265-8900
FOR IMMEDIATE RELEASE
For Further Information: | |
| Diana G. Reardon |
| Senior Vice President and |
| Chief Financial Officer |
| 203/265-8630 |
| www.amphenol.com |
2007 FIRST QUARTER RESULTS
Wallingford, Connecticut. April 18, 2007. Amphenol Corporation (NYSE-APH) reported today that first quarter 2007 diluted earnings per share increased 39% to $.43 compared to $.31 per share for the comparable 2006 period. (All per share amounts included herein have been adjusted to reflect the Company’s 2 for 1 stock split effective in March 2007.) Such per share amount for 2007 includes the benefit of $.01 per share relating to a reduction in tax expense of approximately $1.5 million for tax reserve adjustments relating to the completion of the audit of certain of the Company’s prior year tax returns. Sales for the first quarter 2007 increased 14% to $651.0 million compared to $569.0 million for the 2006 period. Currency translation had the effect of increasing sales by approximately $14.5 million in the first quarter 2007 compared to the 2006 period.
Amphenol Chairman and CEO, Martin H. Loeffler, stated: “We are pleased to have a strong start in 2007 with first quarter sales of $651 million and earnings per share of $.43. Sales grew 14% over last year. Growth was broad based and well balanced across all of our end markets and included all geographic regions. Both segments of the business performed well in the first quarter. The interconnect segment of our business (approximately 90% of sales) grew 15% over last year and the cable segment of our business (approximately 10% of sales) grew 10%. Our strong growth reflects our continued commitment to develop performance enhancing technologies for our customers in all of our markets.”
“In addition to excellent overall top line growth, profitability and cash flow continued to be strong. Amphenol achieved excellent operating leverage in the quarter with an operating income margin of 18.8% in the first quarter compared to 17.3% in the first quarter of 2006. The combination of strong top line growth focused on value added application specific products together with a strong focus on the timely implementation of cost reduction and other profit improvement actions contributed significantly in the quarter and provide a solid base for future
performance. Furthermore, net income, that is income after interest expense and taxes, was approximately 12% of sales, another indication of the Company’s excellent profitability. The Company continues to be an excellent generator of cash. Cash flow from operations remained strong in the quarter at $62 million.”
“The first quarter was good in all respects. I am very proud of our organization as we continue to execute well. We have an outstanding management team, excellent technological capabilities, leading positions in diversified markets and an increasing presence with the major companies in these markets. We are the world’s third largest interconnect company with an expanded platform for creating value. Assuming a continuation of the current economic climate and relatively stable currency exchange rates, we are raising our guidance for the full year 2007 to achieve revenues and EPS in the range of $2,670 million to $2,715 million and $1.75 to $1.80, respectively, an increase of 8% to 10% and 19% to 22% over 2006 revenues and EPS before flood related charges, respectively. This compares to the Company’s previous guidance of revenues and EPS in the range of $2,650 million to $2,710 million and $1.73 to $1.78, respectively. For the second quarter 2007 we expect revenues in the range of $670 million to $685 million and EPS in the range of $.43 and $.45, respectively. We are very excited about the future and confident in the ability of our excellent organization to meet the challenges presented and to take advantage of the many opportunities in front of us.”
The Company will host a conference call to discuss its first quarter results at 1:00 PM (ET) April 18, 2007. The toll free dial-in number to participate in this call is 888-395-9624; International dial-in number 517-623-4547; Passcode: Reardon. There will be a replay available until 6:00 PM (ET) on Friday, April 20, 2007. The replay numbers are as follows: toll free dial-in number is 800-879-2780 and International dial-in number is 402-220-4711.
A live broadcast as well as a replay will also be available on the Internet at http://www.amphenol.com/index.cfm/fuseaction/financial.webcasts.
Amphenol Corporation is one of the world’s leading producers of electronic and fiber optic connectors, cable and interconnect systems. Amphenol products are engineered and manufactured in the Americas, Europe and Asia and sold by a worldwide sales and marketing organization. Amphenol has a diversified presence as a leader in high growth segments of the interconnect market including: Military, Commercial Aerospace, Automotive, Broadband Communication, Industrial, Information Technology and Data Communications Equipment, Mobile Devices and Wireless Infrastructure.
Statements in this press release which are other than historical facts are intended to be “forward-looking statements” within the meaning of the Securities Exchange Act of 1934, the Private Securities Litigation Reform Act of 1995 and other related laws. While the Company believes such statements are reasonable, the actual results and effects could differ materially from those currently anticipated. Please refer to Part I, Item 1A of the Company’s Form 10-K for the year ended December 31, 2006, for some factors that could cause the actual results to differ from estimates. In providing forward-looking statements, the Company is not undertaking any duty or obligation to update these statements publicly as a result of new information, future events or otherwise.
2
AMPHENOL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(dollars in thousands, except per share data)
|
| Three months ended |
| ||||
|
| March 31, |
| ||||
|
| 2007 |
| 2006 |
| ||
|
|
|
|
|
| ||
Net Sales |
| $ | 651,084 |
| $ | 568,991 |
|
|
|
|
|
|
| ||
Cost of sales (1) |
| 440,516 |
| 389,176 |
| ||
|
|
|
|
|
| ||
Gross profit (1) |
| 210,568 |
| 179,815 |
| ||
|
|
|
|
|
| ||
Selling, general and administrative expense (1) |
| 87,971 |
| 81,424 |
| ||
|
|
|
|
|
| ||
|
|
|
|
|
| ||
Operating income |
| 122,597 |
| 98,391 |
| ||
|
|
|
|
|
| ||
Interest expense |
| (9,042 | ) | (10,184 | ) | ||
Other expenses, net |
| (3,149 | ) | (2,724 | ) | ||
|
|
|
|
|
| ||
Income before income taxes |
| 110,406 |
| 85,483 |
| ||
|
|
|
|
|
| ||
Provision for income taxes |
| (32,702 | ) | (28,209 | ) | ||
|
|
|
|
|
| ||
Net income |
| $ | 77,704 |
| $ | 57,274 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| ||
Net income per common share — Basic (2) |
| $ | 0.44 |
| $ | 0.32 |
|
|
|
|
|
|
| ||
Average shares outstanding — Basic (2) |
| 178,132,764 |
| 178,894,320 |
| ||
|
|
|
|
|
| ||
Net income per common share — Diluted (2) |
| $ | 0.43 |
| $ | 0.31 |
|
|
|
|
|
|
| ||
Average shares outstanding — Diluted (2) |
| 182,543,418 |
| 183,060,348 |
| ||
|
|
|
|
|
| ||
|
|
|
|
|
| ||
(1) – As described in the Company’s 2006 Form 10-K, the Company changed the presentation of the Consolidated Statements of Income to remove the separate caption for depreciation and amortization and include depreciation and amortization expense in Cost of sales and Selling, general & administrative expense allowing for Gross profit to be presented.
(2) – On January 17, 2007, the Company announced a 2-for-1 stock split that was effective for stockholders of record as of March 16, 2007. The additional shares were distributed on March 30, 2007 and the share information included herein reflects the effect of such stock split.
3
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
|
| March 31, |
| December 31, |
| ||
|
| 2007 |
| 2006 |
| ||
|
| Unaudited |
|
|
| ||
ASSETS |
|
|
|
|
| ||
|
|
|
|
|
| ||
Current Assets: |
|
|
|
|
| ||
Cash and short-term cash investments |
| $ | 85,089 |
| $ | 74,135 |
|
Accounts receivable, less allowance for doubtful accounts of $14,374 and $14,677, respectively |
| 392,529 |
| 383,858 |
| ||
Inventories |
| 427,747 |
| 416,499 |
| ||
Prepaid expenses and other assets |
| 66,067 |
| 60,113 |
| ||
|
|
|
|
|
| ||
Total current assets |
| 971,432 |
| 934,605 |
| ||
|
|
|
|
|
| ||
Land and depreciable assets, less accumulated depreciation of $419,689 and $404,401, respectively |
| 280,575 |
| 274,143 |
| ||
Deferred debt issuance costs |
| 2,768 |
| 2,947 |
| ||
Goodwill |
| 937,707 |
| 926,242 |
| ||
Other assets |
| 52,255 |
| 57,460 |
| ||
|
|
|
|
|
| ||
|
| $ | 2,244,737 |
| $ | 2,195,397 |
|
|
|
|
|
|
| ||
LIABILITIES & SHAREHOLDERS’ EQUITY |
|
|
|
|
| ||
|
|
|
|
|
| ||
Current Liabilities: |
|
|
|
|
| ||
Accounts payable |
| $ | 217,911 |
| $ | 234,868 |
|
Accrued interest |
| 4,156 |
| 4,156 |
| ||
Accrued salaries, wages and employee benefits |
| 50,002 |
| 53,158 |
| ||
Other accrued expenses |
| 108,421 |
| 149,545 |
| ||
Dividends payable |
| 2,696 |
| 2,691 |
| ||
Current portion of long-term debt |
| 2,702 |
| 3,241 |
| ||
|
|
|
|
|
| ||
Total current liabilities |
| 385,888 |
| 447,659 |
| ||
|
|
|
|
|
| ||
Long-term debt |
| 685,279 |
| 677,173 |
| ||
Accrued pension and post employment benefit obligations |
| 141,335 |
| 138,312 |
| ||
Other liabilities |
| 57,983 |
| 29,259 |
| ||
|
|
|
|
|
| ||
Shareholders’ Equity: |
|
|
|
|
| ||
Common stock |
| 178 |
| 178 |
| ||
Additional paid-in deficit |
| (111,350 | ) | (119,420 | ) | ||
Accumulated earnings |
| 1,164,190 |
| 1,142,536 |
| ||
Accumulated other comprehensive loss |
| (78,766 | ) | (81,084 | ) | ||
Treasury stock, at cost |
| — |
| (39,216 | ) | ||
|
|
|
|
|
| ||
Total shareholders’ equity |
| 974,252 |
| 902,994 |
| ||
|
|
|
|
|
| ||
|
| $ | 2,244,737 |
| $ | 2,195,397 |
|
|
|
|
|
|
| ||
4
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited)
(dollars in thousands)
|
| Three months ended |
| ||||
|
| March 31, |
| ||||
|
| 2007 |
| 2006 |
| ||
|
|
|
|
|
| ||
Net income |
| $ | 77,704 |
| $ | 57,274 |
|
Adjustments for cash from operations: |
|
|
|
|
| ||
Depreciation and amortization |
| 18,885 |
| 17,776 |
| ||
Amortization of deferred debt issue costs |
| 179 |
| 131 |
| ||
Stock-based compensation. |
| 2,990 |
| 1,781 |
| ||
Net change in non-cash components of working capital |
| (45,790 | ) | (23,209 | ) | ||
Other long term assets and liabilities |
| 8,495 |
| 2,150 |
| ||
|
|
|
|
|
| ||
Cash provided by operations |
| 62,463 |
| 55,903 |
| ||
|
|
|
|
|
| ||
Cash flow from investing activities: |
|
|
|
|
| ||
Capital additions, net |
| (22,628 | ) | (20,160 | ) | ||
Purchase of short term investments |
| (2,007 | ) | — |
| ||
Investments in acquisitions |
| (22,342 | ) | (15,682 | ) | ||
|
|
|
|
|
| ||
Cash flow used in investing activities |
| (46,977 | ) | (35,842 | ) | ||
|
|
|
|
|
| ||
Cash flow from financing activities: |
|
|
|
|
| ||
Net change in borrowings under revolving credit facilities |
| 7,518 |
| (24,032 | ) | ||
Purchase of treasury stock |
| (13,983 | ) | — |
| ||
Proceeds from exercise of stock options |
| 2,975 |
| 3,996 |
| ||
Excess tax benefits from stock-based payment arrangements |
| 1,642 |
| 1,289 |
| ||
Dividend payments |
| (2,684 | ) | (2,679 | ) | ||
|
|
|
|
|
| ||
Cash flow used in financing activities |
| (4,532 | ) | (21,426 | ) | ||
|
|
|
|
|
| ||
Net change in cash and short-term cash investments |
| 10,954 |
| (1,365 | ) | ||
|
|
|
|
|
| ||
Cash and short-term cash investments balance, beginning of period |
| 74,135 |
| 38,669 |
| ||
|
|
|
|
|
| ||
Cash and short-term cash investments balance, end of period |
| $ | 85,089 |
| $ | 37,304 |
|
|
|
|
|
|
| ||
Net cash paid during the year for: |
|
|
|
|
| ||
Interest |
| 8,907 |
| 10,431 |
| ||
Taxes |
| 26,032 |
| 21,260 |
| ||
5
AMPHENOL CORPORATION
SEGMENT INFORMATION
(dollars in thousands)
(Unaudited)
|
| Three months ended |
| ||||
|
| March 31, |
| ||||
|
| 2007 |
| 2006 |
| ||
|
|
|
|
|
| ||
Trade Sales: |
|
|
|
|
| ||
Interconnect Products |
| $ | 585,265 |
| $ | 509,058 |
|
Cable Products |
| 65,819 |
| 59,933 |
| ||
Consolidated |
| $ | 651,084 |
| $ | 568,991 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| ||
Operating income: |
|
|
|
|
| ||
Interconnect Products |
| $ | 124,881 |
| $ | 99,869 |
|
Cable Products |
| 7,921 |
| 6,291 |
| ||
Stock-based compensation expense |
| (2,990 | ) | (1,781 | ) | ||
Other operating expenses |
| (7,215 | ) | (5,988 | ) | ||
Consolidated |
| $ | 122,597 |
| $ | 98,391 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| ||
ROS%: |
|
|
|
|
| ||
Interconnect Products |
| 21.3 | % | 19.6 | % | ||
Cable Products |
| 12.0 | % | 10.5 | % | ||
Corporate - Stock-based compensation |
| -0.5 | % | -0.3 | % | ||
Corporate - all other |
| -1.1 | % | -1.1 | % | ||
|
|
|
|
|
| ||
Consolidated |
| 18.8 | % | 17.3 | % | ||
6
