CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | ||
In Thousands | Jun. 30, 2009
| Dec. 31, 2008
|
Current Assets: | ||
Cash and cash equivalents | $220,765 | $214,987 |
Accounts receivable, less allowance for doubtful accounts of $17,967 and $14,982, respectively | 445,073 | 515,999 |
Inventories, net | 449,894 | 512,507 |
Other current assets | 91,209 | 92,371 |
Total current assets | 1,206,941 | 1,335,864 |
Land and depreciable assets, less accumulated depreciation of $547,890 and $510,764, respectively | 345,538 | 344,515 |
Goodwill | 1,349,707 | 1,232,335 |
Other long-term assets | 97,331 | 81,445 |
Total Assets | 2,999,517 | 2,994,159 |
Current Liabilities: | ||
Accounts payable | 247,391 | 305,950 |
Accrued salaries, wages and employee benefits | 60,788 | 59,644 |
Accrued income taxes | 48,442 | 65,846 |
Accrued acquisition-related obligations | 9,220 | 120,357 |
Other accrued expenses | 71,227 | 82,596 |
Current portion of long-term debt and capital lease obligations | 527 | 439 |
Total current liabilities | 437,595 | 634,832 |
Long-term debt and capital lease obligations | 820,581 | 786,020 |
Accrued pension and post employment benefit obligations | 169,695 | 161,669 |
Other long-term liabilities | 42,918 | 43,069 |
Shareholders' Equity: | ||
Common stock | 172 | 171 |
Additional paid-in capital | 36,862 | 22,746 |
Accumulated earnings | 1,611,240 | 1,467,099 |
Accumulated other comprehensive loss | (138,876) | (140,591) |
Total shareholders' equity attributable to Amphenol Corporation | 1,509,398 | 1,349,425 |
Noncontrolling interests | 19,330 | 19,144 |
Total equity | 1,528,728 | 1,368,569 |
Total Liabilities & Shareholders' Equity | $2,999,517 | $2,994,159 |
1_CONDENSED CONSOLIDATED BALANC
CONDENSED CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) (USD $) | ||
In Thousands | Jun. 30, 2009
| Dec. 31, 2008
|
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Allowance for doubtful accounts | $17,967 | $14,982 |
Accumulated depreciation | $547,890 | $510,764 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD $) | ||||
In Thousands, except Share data | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Gross profit | ||||
Net sales | $685,184 | $846,817 | $1,345,196 | $1,617,531 |
Cost of sales | 471,034 | 570,227 | 924,667 | 1,090,035 |
Gross profit | 214,150 | 276,590 | 420,529 | 527,496 |
Selling, general and administrative expense | 98,672 | 108,367 | 194,366 | 208,977 |
Operating income | 115,478 | 168,223 | 226,163 | 318,519 |
Interest expense | (9,131) | (9,915) | (18,129) | (19,814) |
Other income (expenses), net | (382) | 134 | (597) | (348) |
Income before income taxes | 105,965 | 158,442 | 207,437 | 298,357 |
Provision for income taxes | (29,140) | (46,022) | (53,562) | (86,806) |
Net income | 76,825 | 112,420 | 153,875 | 211,551 |
Less: Net income attributable to noncontrolling interests | (1,955) | (2,425) | (4,595) | (4,088) |
Net income attributable to Amphenol Corporation | $74,870 | $109,995 | $149,280 | $207,463 |
Net income per common share-Basic (in dollars per share) | 0.44 | 0.63 | 0.87 | 1.18 |
Average common shares outstanding-Basic (in shares) | 171,317,112 | 175,487,646 | 171,251,519 | 176,075,131 |
Net income per common share-Diluted (in dollars per share) | 0.43 | 0.61 | 0.86 | 1.15 |
Average common shares outstanding-Diluted (in shares) | 173,649,705 | 179,395,729 | 173,375,613 | 179,796,849 |
Dividends declared per common share (in dollars per share) | 0.015 | 0.015 | 0.03 | 0.03 |
2_CONDENSED CONSOLIDATED STATEM
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (USD $) | ||
In Thousands | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Cash flow provided by operations | ||
Net income | $153,875 | $211,551 |
Adjustments for cash from operations: | ||
Depreciation and amortization | 47,770 | 45,684 |
Stock-based compensation expense | 10,028 | 7,196 |
Net change in receivables sold | (6,000) | |
Net change in components of working capital | 76,057 | (69,704) |
Net change in other long-term assets and liabilities | 2,911 | 11,088 |
Cash flow provided by operations | 284,641 | 205,815 |
Cash flow from investing activities: | ||
Capital additions, net | (30,832) | (50,503) |
Purchase of short-term investments | (593) | (8,551) |
Investments in acquisitions | (271,578) | (99,474) |
Cash flow used in investing activities | (303,003) | (158,528) |
Cash flow from financing activities: | ||
Net change in borrowings under revolving credit facilities | 35,281 | 94,277 |
Purchase of treasury stock | (143,693) | |
Proceeds from exercise of stock options | 3,015 | 8,782 |
Excess tax benefits from stock-based payment arrangements | 696 | 4,981 |
Dividend payments | (7,706) | (5,317) |
Cash flow provided by (used in) financing activities | 31,286 | (40,970) |
Effect of exchange rate changes on cash and cash equivalents | (7,146) | (1,196) |
Net change in cash and cash equivalents | 5,778 | 5,121 |
Cash and cash equivalents balance, beginning of period | 214,987 | 183,641 |
Cash and cash equivalents balance, end of period | 220,765 | 188,762 |
Cash paid during the period for: | ||
Interest | 17,957 | 19,877 |
Income taxes | $62,086 | $72,095 |
Principles of Consolidation and
Principles of Consolidation and Interim Financial Statements | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Principles of Consolidation and Interim Financial Statements | Note1-Principles of Consolidation and Interim Financial Statements The condensed consolidated balance sheets as of June30, 2009 and December31, 2008, the related condensed consolidated statements of income for the three and six months ended June30, 2009 and 2008 and the condensed consolidated statements of cash flow for the six months ended June30, 2009 and 2008 include the accounts of Amphenol Corporation and its subsidiaries (the Company). The financial statements included herein are unaudited. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of such interim financial statements have been included. The results of operations for the three and six months ended June30, 2009 are not necessarily indicative of the results to be expected for the full year. These financial statements and the related notes should be read in conjunction with the financial statements and notes included in the Companys 2008 Annual Report on Form10-K. |
Inventories
Inventories | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Inventories | Note 2-Inventories Inventories, net, consist of: June30, 2009 December31, 2008 Raw materials and supplies $ 118,284 $ 130,572 Work in process 212,528 233,003 Finished goods 119,082 148,932 $ 449,894 $ 512,507 |
Reportable Business Segments
Reportable Business Segments | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Reportable Business Segments | Note3-Reportable Business Segments The Company has two reportable business segments: (i)Interconnect Products and Assemblies and (ii)Cable Products. The Interconnect Products and Assemblies segment produces connectors and connector assemblies primarily for the communications, aerospace, industrial and automotive markets. The Cable Products segment produces coaxial and flat ribbon cable and related products primarily for the communications markets, including cable television. The accounting policies of the segments are the same as those for the Company as a whole. The Company evaluates the performance of its business segments on, among other things, profit or loss from operations before interest, headquarters expense allocations, stock-based compensation expense, income taxes, amortization related to certain intangible assets and nonrecurring gains and losses. The segment results for the three months ended June30, 2009 and 2008 are as follows: Interconnect Products and Assemblies Cable Products Total 2009 2008 2009 2008 2009 2008 Net sales -external $ 621,440 $ 771,112 $ 63,744 $ 75,705 $ 685,184 $ 846,817 -inter-segment 867 1,162 2,335 3,970 3,202 5,132 Segment operating income 119,743 171,625 10,059 8,729 129,802 180,354 The segment results for the six months ended June30, 2009 and 2008 are as follows: Interconnect Products and Assemblies Cable Products Total 2009 2008 2009 2008 2009 2008 Net sales -external $ 1,223,398 $ 1,471,737 $ 121,798 $ 145,794 $ 1,345,196 $ 1,617,531 -inter-segment 1,509 2,044 4,440 8,071 5,949 10,115 Segment operating income 236,186 325,161 17,895 16,999 254,081 342,160 A reconciliation of segment operating income to consolidated income before income taxes for the three and six months ended June30, 2009 and 2008 is summarized as follows: Three months ended June30, Six months ended June30, 2009 2008 2009 2008 Segment operating income $ 129,802 $ 180,354 $ 254,081 $ 342,160 Interest expense (9,131 ) (9,915 ) (18,129 ) (19,814 ) Other expenses, net (9,461 ) (8,003 ) (18,487 ) (16,793 ) Stock-based compensation expense (5,245 ) (3,994 ) (10,028 ) (7,196 ) Income before income taxes $ 105,965 $ 158,442 $ 207,437 $ 298,357 |
Comprehensive Income
Comprehensive Income | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Comprehensive Income | Note 4-Comprehensive Income Total comprehensive income for the three and six months ended June30, 2009 and 2008 is summarized as follows: Three months ended June30, Six months ended June30, 2009 2008 2009 2008 Net income $ 76,825 $ 112,420 $ 153,875 $ 211,551 Currency translation adjustments 25,788 (2,484 ) (4,244 ) 12,685 Revaluation of interest rate derivatives 2,451 8,333 4,911 (1,495 ) Defined benefit plan liability adjustment (16 ) (292 ) Total comprehensive income $ 105,048 $ 118,269 $ 154,250 $ 222,741 |
Noncontrolling Interests
Noncontrolling Interests | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Noncontrolling Interests | Note 5-Noncontrolling Interests Effective January1, 2009, the Company adopted Statement of Financial Accounting Standards (SFAS) No.160, Noncontrolling Interests in Financial Statements (SFAS 160). SFAS 160 requires companies to classify expenses related to noncontrolling interests share in income below net income (earnings per share will still be determined after the impact of the noncontrolling interests share in net income of the Company). In addition, SFAS 160 requires the liability related to noncontrolling interests to be presented as a separate caption within equity. The presentation and disclosure requirements of SFAS 160 were retroactively applied. A reconciliation of consolidated changes in equity for the six months ended June30, 2009 is as follows: AmphenolCorporationShareholders Accum.Other Common AdditionalPaid Accumulated Comprehensive Noncontrolling Total Stock InCapital Earnings Loss Interests Equity Balance as of December31, 2008 $ 171 $ 22,746 $ 1,467,099 $ (140,591 ) $ 19,144 $ 1,368,569 Comprehensive income: Net income 149,280 4,595 153,875 Other comprehensive income, net of tax: Translation adjustments (2,904 ) (1,340 ) (4,244 ) Revaluation of interest rate derivatives 4,911 4,911 Defined benefit plan liability adjustment (292 ) (292 ) Payments to shareholders of noncontrolling interest (3,069 ) (3,069 ) Stock options exercised, including tax benefit 1 4,002 4,003 Stock compensation 85 85 Dividends declared (5,139 ) (5,139 ) Stock-based compensation expense 10,029 10,029 Balance as of June30, 2009 $ 172 $ 36,862 $ 1,611,240 $ (138,876 ) $ 19,330 $ 1,528,728 |
Earnings Per Share
Earnings Per Share | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Earnings Per Share | Note 6-Earnings Per Share Basic earnings per share (EPS) is computed by dividing net income by the weighted-average number of common shares outstanding. Diluted EPS is computed by dividing net income by the weighted-average number of common shares and dilutive common shares outstanding, which relates to stock options. A reconciliation of the basic average common shares outstanding to diluted average common shares outstanding for the three and six months ended June30, 2009 and 2008 is as follows (dollars in thousands, except per share amounts): Three months ended June30, Six months ended June30, 2009 2008 2009 2008 Net income attributable to Amphenol Corporation $ 74,870 $ 109,995 $ 149,280 $ 207,463 Basic average common shares outstanding 171,317,112 175,487,646 171,251,519 176,075,131 Effect of dilutive stock options 2,332,593 3,908,083 2,124,094 3,721,718 Diluted average common shares outstanding 173,649,705 179,395,729 173,375,613 179,796,849 Earnings per share: Basic $ 0.44 $ 0.63 $ 0.87 $ 1.18 Diluted $ 0.43 $ 0.61 $ 0.86 $ 1.15 Excluded from the computations above were anti-dilutive shares of 7,776,030 and 2,146,200 for the six months ended June30, 2009 and 2008, respectively. |
Commitments and Contingencies
Commitments and Contingencies | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Commitments and Contingencies | Note7-Commitments and Contingencies In the course of pursuing its normal business activities, the Company is involved in various legal proceedings and claims. Management does not expect that amounts, if any, which it may be required to pay by reason of such proceedings or claims will have a material effect on the Companys financial condition or results of operations. Certain operations of the Company are subject to environmental laws and regulations which govern the discharge of pollutants into the air and water, as well as the handling and disposal of solid and hazardous wastes. The Company believes that its operations are currently in substantial compliance with all applicable environmental laws and regulations and that the costs of continuing compliance will not have a material effect on the Companys financial condition or results of operations. Subsequent to the acquisition of Amphenol Corporation from Allied Signal Corporation (Allied Signal) in 1987 (Allied Signal merged with and into Honeywell International,Inc. in December1999 (Honeywell)), Amphenol Corporation and Honeywell were named jointly and severally liable as potentially responsible parties in connection with several environmental cleanup sites. Amphenol Corporation and Honeywell jointly consented to perform certain investigations and remedial and monitoring activities at two sites, and they have been jointly ordered to perform work at another site. The costs incurred relating to these three sites are reimbursed by Honeywell based on an agreement (the Honeywell Agreement) entered into in connection with the acquisition in 1987. For sites covered by the Honeywell Agreement, to the extent that conditions or circumstances occurred or existed at the time of or prior to the acquisition in 1987, Honeywell is obligated to reimburse Amphenol Corporation 100% of such costs. Honeywell representatives continue to work closely with the Company in addressing the most significant environmental liabilities covered by the Honeywell Agreement. Management does not believe that the costs associated with resolution of these or any other environmental matters will have a material effect on the Companys consolidated financial condition or results of operations. The environmental investigation, remedial and monitoring activities identified by the Company, including those referred to above, are covered under the Honeywell Agreement. |
New Accounting Pronouncements
New Accounting Pronouncements | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
New Accounting Pronouncements | Note 8- New Accounting Pronouncements In May2009, the FASB issued SFAS No.165, Subsequent Events (SFAS No.165). SFAS No.165 establishes general standards of accounting for, and disclosure of, events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In particular, this statement sets forth: (1)the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, (2)the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements and (3)the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. SFAS No.165 is effective for the interim or annual financial periods ending after June15, 2009. The Company adopted SFAS No.165 on June30, 2009, and such adoption did not have a material impact on the Companys condensed consolidated financial statements. The Company evaluated subsequent events through the date the accompanying financial statements were issued, which was August6, 2009. |
Stock-Based Compensation
Stock-Based Compensation | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Stock-Based Compensation | Note 9-Stock-Based Compensation In May2009, the Company adopted the 2009 Stock Purchase and Option Plan (the 2009 Option Plan) for key employees of Amphenol Corporation and Subsidiaries. The Company previously maintained the 1997 Option Plan (the 1997 Option Plan) and maintains the 2000 Stock Purchase and Option Plan (the 2000 Option Plan). As of April2009, all previously awarded options under the 1997 Option Plan have been exercised or forfeited, and the 1997 Option Plan has been terminated per the terms of the 1997 Option Plan. The 2000 Option Plan and the 2009 Option Plan authorize the granting of additional stock options by a committee of the Companys Board of Directors. As of June30, 2009, there were no shares of common stock available for the granting of additional stock options under the 2000 Option Plan, and there were 12,323,500 shares of common stock available for the granting of additional stock options under the 2009 Option Plan. Options granted under the 2000 Option Plan and the 2009 Option Plan vest ratably over a period of five years and are exercisable over a period of ten years from the date of grant. In addition, shares issued in conjunction with the exercise of stock options under the 2000 Option Plan and the 2009 Option Plan are subject to management stockholder agreements. In 2004, the Company adopted the 2004 Stock Option Plan for Directors of Amphenol Corporation (the Directors Option Plan). The Directors Option Plan is administered by the Companys Board of Directors. As of June30, 2009, the maximum number of shares of common stock available for the granting of additional stock options under the Directors Option Plan was 200,000. Options granted under the Directors Option Plan vest ratably over a period of three years and are exercisable over a period of ten years from the date of grant. The grant-date fair value of each option grant under the 2000 Option Plan, the 2009 Option Plan and the Directors Option Plan is estimated using the Black-Scholes option pricing model. The fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. Expected share price volatility was calculated based on the historical volatility of the stock of Amphenol Corporation and implied volatility derived from related exchange traded options. The average expected life was based on the contractual term of the option and expected employee exercise and historical post-vesting employment termination behavior. The risk-free interest rate is based on U.S. Treasury zero-coupon issues with a remaining term equal to the expected life assumed at the date of grant. The expected annual dividend per share was based on Amphenol Corporations dividend rate. Stock-based compensation expense includes the estimated effects of forfeitures, which are adjusted over the requisite service period to the extent actual forfeitures differ or are expected to differ from such estimates. Changes in estimated forfeitures are recognized in the period of change and impact |
Shareholders Equity
Shareholders Equity | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Shareholders' Equity | Note 10-Shareholders Equity The Company maintains an open-market stock repurchase program (the Program) expiring on January31, 2010 to repurchase up to 20,000,000 shares of its common stock. The Company did not purchase any shares of its common stock under the Program during the six months ended June30, 2009. As of June30, 2009, approximately 1,850,000 shares of common stock may still be purchased under the Program. The Company pays a quarterly dividend on its common stock of $.015 per share. The Company paid its second quarter dividend in the amount of $2,571, or $.015 per share on June30, 2009 to shareholders of record as of June10, 2009. Cumulative dividends declared during 2009 were $5,139. Total dividends paid in 2009 were $7,706, including those declared in 2008 and paid in 2009. |
Benefit Plans and Other Postret
Benefit Plans and Other Postretirement Benefits | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Benefit Plans and Other Postretirement Benefits | Note 11-Benefit Plans and Other Postretirement Benefits The Company and certain of its domestic subsidiaries have a defined benefit pension plan (the U.S. Plan) covering certain of its U.S. employees. Benefits under the U.S. Plan are generally based on years of service and compensation and are generally noncontributory. Certain foreign subsidiaries have defined benefit plans covering their employees. The following is a summary of the funded status of the Companys defined benefit plans as of the most recent actuarial valuations; for each year presented below, projected benefits exceed assets. Other Postretirement Pension Benefits Benefits Three months ended June30, 2009 2008 2009 2008 Service cost $ 1,666 $ 1,958 $ 40 $ 47 Interest cost 5,653 5,820 209 219 Expected return on plan assets (5,749 ) (6,627 ) Amortization of transition obligation (24 ) (27 ) 16 16 Amortization of prior service cost 516 519 Amortization of net actuarial losses 1,925 1,519 193 241 Net benefits expense $ 3,987 $ 3,162 $ 458 $ 523 Other Postretirement Pension Benefits Benefits Six months ended June30, 2009 2008 2009 2008 Service cost $ 3,287 $ 3,905 $ 80 $ 94 Interest cost 11,221 11,614 418 439 Expected return on plan assets (11,450 ) (13,257 ) Amortization of transition obligation (46 ) (54 ) 32 31 Amortization of prior service cost 1,030 1,038 Amortization of net actuarial losses 3,837 3,038 387 482 Net benefits expense $ 7,879 $ 6,284 $ 917 $ 1,046 The Company intends to make cash contributions to the U.S. Plan in accordance with minimum funding requirements but may also make voluntary cash contributions. Voluntary cash contributions to the U.S. Plan in 2009 and in future years will depend on a number of factors including performance of the U.S. Plan assets. The Company offers various defined contribution plans for its U.S. and foreign employees. Participation in these plans is based on certain eligibility requirements. The Company matches the majority of employee contributions to the U.S. defined contribution plans with cash contributions up to a maximum of 5% of eligible compensation. During the six months ended June30, 2009 and 2008, the total matching contributions to these U.S. defined contribution plans were approximately $915 and $948, respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Goodwill and Other Intangible Assets | Note 12-Goodwill and Other Intangible Assets As of June30, 2009, the Company has goodwill totaling $1,349,707 of which $1,276,158 is related to the Interconnect Products and Assemblies segment with the remainder related to the Cable Products segment. For the six months ended June30, 2009, goodwill increased by $117,372, primarily as a result of two acquisitions in the Interconnect Products and Assemblies segment made during the period. The Company is in the process of completing its analysis of fair value attributes of the assets acquired related to its 2009 and certain of its 2008 acquisitions and anticipates that the final assessment of values will not differ materially from the preliminary assessment. The Company does not have any intangible assets not subject to amortization other than goodwill. A summary of the Companys amortizable intangible assets as of June30, 2009 is as follows: Gross Carrying Amount Accumulated Amortization Weighted-Average Useful Life Customer relationships $ 63,900 $ 13,900 9 years Proprietary technology 36,900 7,700 15 years License agreements 6,000 2,700 8 years Trade names and other 9,200 7,000 15 years Total $ 116,000 $ 31,300 11 years Intangible assets are included in other long-term assets in the accompanying Condensed Consolidated Balance Sheets. The aggregate amortization expense for the three months ended June30, 2009 and 2008 was approximately $3,400 and $2,400, respectively. The aggregate amortization expense for the six months ended June30, 2009 and 2008 was approximately $6,300 and $4,600, respectively. As of June30, 2009, amortization expense estimated for each of the next five fiscal years is approximately $12,800 in 2010, $10,800 each in 2011 and 2012, $7,600 in 2013 and $4,700 in 2014. |
Long-Term Debt
Long-Term Debt | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Long-Term Debt | Note 13Long-Term Debt The Company has a five-year $1,000,000 unsecured revolving credit facility (the Revolving Credit Facility) that is scheduled to expire in August2011, of which approximately $814,000 was drawn as of June30, 2009. As of June30, 2009, availability under the Revolving Credit Facility was $186,000. The Companys interest rate on borrowings under the Revolving Credit Facility is LIBOR plus 40 basis points. The Company also pays certain annual agency and facility fees. The Revolving Credit Facility requires that the Company satisfy certain financial covenants. As of June30, 2009, the Company was in compliance with all financial covenants under the Revolving Credit Facility, and the Companys credit rating from Standard Poors was BBB- and from Moodys was Baa3. In March2009, the Company entered into a $20,000 letter of credit facility, of which approximately $14,900 was outstanding as of June30, 2009. As of June30, 2009, the Company had interest rate swap agreements of $150,000, $250,000 and $250,000 that fix the Companys LIBOR interest rate at 4.40%, 4.65% and 4.73%, respectively, expiring in December2009, December2009 and July2010, respectively. The fair value of swaps indicated that termination of the agreements as of June30, 2009 would have resulted in a pre-tax loss of $17,111; such loss, net of tax of $6,331 is included in accumulated other comprehensive loss in the accompanying Condensed Consolidated Balance Sheets. |
Business Combinations
Business Combinations | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Business Combinations | Note 14- Business Combinations Effective January1, 2009, the Company adopted SFAS No.141R, Business Combinations (SFAS 141R). SFAS 141R is applicable to the Company for acquisitions completed on or after January1, 2009 and establishes principles and requirements for how the acquirer: (1)recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; (2)recognizes and measures the goodwill acquired in the business combination; and (3)determines what information to disclose in the financial statements. The areas of SFAS 141R that are most applicable to the Company are: (1)SFAS 141R requires companies to expense transaction costs as incurred; (2)any subsequent adjustments to a recorded performance-based liability after its recognition are adjusted through income as opposed to goodwill; and (3)any noncontrolling interests are recorded at fair value. During the six months ended June30, 2009, goodwill of approximately $127,000 attributable to the Interconnect Products and Assemblies segment was recognized related to businesses acquired during the period, which was not significant to the Company either individually or in the aggregate. |
Fair Value Measurements
Fair Value Measurements | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Fair Value Measurements | Note 15Fair Value Measurements Effective January1, 2008, the Company adopted SFASNo.157, Fair Value Measurements (SFAS 157). SFAS157 established a new framework for measuring fair value of financial and non-financial instruments and expands related disclosures. The Company does not have any non-financial instruments accounted for at fair value on a recurring basis. Broadly, the SFAS157 framework requires fair value to be determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. SFAS 157 establishes market or observable inputs as the preferred source of values. Assumptions based on hypothetical transactions are used in the absence of market inputs. The valuation techniques required by SFAS 157 are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Companys market assumptions. These two types of inputs create the following fair value hierarchy: Level 1 Quoted prices for identical instruments in active markets. Level 2 Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3 Significant inputs to the valuation model are unobservable. The Company maintains policies and procedures to value instruments using the most relevant data available including independent price validation for certain instruments. The Company believes that the only financial instrument subject to SFAS 157 with interim disclosure requirements are derivative instruments which represent interest rate swaps that are independently valued using market observable Level 2 inputs including interest rate yield curves. As of June30, 2009, the fair values of derivative instruments reflected a liability of $17,111. The Company does not have any other significant financial or non-financial assets and liabilities that are measured at fair value on a non-recurring basis. |
Derivative Instruments
Derivative Instruments | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Derivative Instruments | Note 16- Derivative Instruments Effective January1, 2009, the Company adopted SFAS No.161, Disclosures about Derivative Instruments and Hedging Activities (SFAS 161). SFAS 161 amends and expands the disclosure requirements of SFAS No.133 Accounting for Derivative Instruments and Hedging Activities (SFAS 133) requiring: (1)how and why an entity uses derivative instruments; (2)how derivative instruments and related hedged items are accounted for under SFAS 133 and its related interpretations; and (3)how derivative instruments and related hedged items affect an entitys financial position, financial performance, and cash flows. The Company is exposed to certain risks related to its ongoing business operations. The primary risk managed by using derivative instruments is interest rate risk. Forward interest rate swap agreements are entered into to manage interest rate risk associated with the Companys variable-rate borrowings. SFAS 133 requires companies to recognize derivative instruments as either assets or liabilities at fair value in the Condensed Consolidated Balance Sheets. In accordance with SFAS 133, the Company designates forward interest rate swap agreements on variable-rate borrowings as cash flow hedges. As of June30, 2009 and December31, 2008, the Company had the following derivative activity related to cash flow hedges: Fair Value Balance Sheet Location June30, 2009 December31, 2008 Derivatives designated as hedging instruments under SFAS 133: Interest rate contracts Other accrued expenses $ 6,950 $ 12,053 Interest rate contracts Other long-term liabilities 10,161 12,904 Total derivatives designated as hedging instruments under SFAS 133 $ 17,111 $ 24,957 For the three and six months ended June30, 2009, a gain of $2,451 and $4,911, respectively, was recognized in accumulated other comprehensive loss associated with interest rate contracts. No gain or loss was reclassified from accumulated other comprehensive loss into net income during the period. As of June30, 2009, the derivatives of the Company were considered effective hedges as defined in SFAS 133. |
Off-Balance Sheet Arrangement -
Off-Balance Sheet Arrangement - Accounts Receivable Securitization | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Off-Balance Sheet Arrangement - Accounts Receivable Securitization | Note 17 Off-Balance Sheet Arrangement Accounts Receivable Securitization A subsidiary of the Company has an agreement whereby the subsidiary can sell an undivided interest of up to $100,000 in a designated pool of qualified accounts receivable (the Agreement). The Company services, administers and collects the receivables on behalf of the purchaser. The Agreement includes certain covenants and provides for various events of termination and originally expired in July2009. The Agreement was amended and extended in May2009 and will expire in May2010. Due to the short-term nature of the accounts receivable, the fair value approximates the carrying value. Program fees payable to the purchaser under the Agreement are equivalent to rates afforded high quality commercial paper issuers plus certain fees and administrative expenses and are included in other expenses, net in the accompanying Consolidated Statements of Income. As of June30, 2009 and December31, 2008, approximately $79,000 and $85,000, respectively, of receivables were sold and are therefore not reflected in accounts receivable in the accompanying Condensed Consolidated Balance Sheets. |
Income Taxes
Income Taxes | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
Income Taxes | Note 18- Income Taxes The provision for income taxes for the second quarter and the first six months of 2009 was at an effective rate of 27.5% and 25.8%, respectively. The provision for income taxes for the second quarter and the first six months of 2008 was at an effective rate of 29.0% and 29.1%, respectively. The effective tax rates for the second quarter and the first six months of 2009 were lower primarily due to a more favorable mix of income in lower tax jurisdictions. In addition, the lower effective tax rate for the first six months of 2009 reflects a reduction of income tax expense of approximately $3,600 in the first quarter of 2009 relating to the completion of certain audits of the Companys prior year tax returns. As of June30, 2009, the amount of the liability for unrecognized tax benefits, which if recognized would impact the effective tax rate, was approximately $34,354, the majority of which is included in other long-term liabilities in the accompanying Condensed Consolidated Balance Sheets. |
DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION (USD $) | |||
In Millions, except Share data | 6 Months Ended
Jun. 30, 2009 | Jul. 31, 2009
| Jun. 30, 2008
|
Document and Entity Information | |||
Entity Registrant Name | AMPHENOL CORP | ||
Entity Central Index Key | 0000820313 | ||
Document Type | 10-Q | ||
Document Period End Date | 2009-06-30 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $7,874 | ||
Entity Common Stock, Shares Outstanding | 171,418,975 |