Exhibit 99.1
Thomas & Betts Corporation Reports Third Quarter 2004 Results
MEMPHIS, Tenn., Oct. 25 /PRNewswire-FirstCall/ -- Thomas & Betts
Corporation (NYSE: TNB) today reported third quarter 2004 net earnings of
$33.4 million, or $0.56 per diluted share, including a pre-tax gain of $13.0
million ($0.14 per share) related to the sale of a minority interest in a
European joint venture. Prior-year third quarter net earnings of $11.8
million, or $0.20 per diluted share, included a pre-tax benefit of $8.9
million ($0.10 per share) for the favorable settlement of a commercial
lawsuit.
Sales in the third quarter 2004 were $394.2 million, up 16.4 percent from
the $338.7 million reported in the prior-year period. Favorable foreign
currency exchange accounted for approximately $8 million of the year-over-year
sales increase.
Earnings from operations were $41.3 million, or 10.5 percent of sales, in
the third quarter 2004, a significant increase over the $26.4 million, or 7.8
percent of sales reported in the third quarter last year.
"We are pleased with our performance in the third quarter as we continued
to see the improvement in sales drop through to the bottom line," said Dominic
J. Pileggi, president and chief executive officer. "We also continue to
successfully manage the on-going volatility in raw material pricing with
little impact on our quarterly results."
The third quarter 2004 gross margin was 27.9 percent of sales. In the
third quarter 2003, the gross margin was 25.0 percent, including $3.7 million
in charges related to closing a satellite distribution center. Selling,
general and administrative expense was $68.7 million, or 17.4 percent of
sales, in the period just ended, compared to $67.0 million, or 19.8 percent of
sales, in the third quarter 2003.
SEGMENT RESULTS
Third quarter sales in the company's Electrical segment were $323.8
million, up $34.4 million, or 11.9 percent, compared to $289.4 million in
sales reported in the third quarter 2003. Favorable foreign currency exchange
accounted for approximately $7 million of the sales increase. Electrical
segments earnings nearly doubled to $34.2 million, compared to $17.6 million
reported last year. These results reflect higher sales volumes, productivity
improvements and the company's ability to offset higher raw material costs.
Sales in the company's Steel Structures segment were $42.4 million, a
significant increase over the $23.5 million recorded in third quarter 2003.
The improvement is due to an increase in demand by utilities for transmission
poles, emergency sales related to the severe weather in the southeast United
States and price increases to offset higher raw material costs. Segment
earnings were $5.9 million, more than twice the $2.7 million reported in the
same period last year, due primarily to the higher sales volumes.
HVAC segment sales were $28.0 million in the third quarter 2004, compared
to $25.8 million a year ago. Segment earnings were $1.9 million compared to
$1.4 million in the third quarter last year.
YEAR-TO-DATE RESULTS
For the nine months ended September 30, 2004, Thomas & Betts reported
sales of $1.1 billion, a 14.7 percent increase compared to $972.8 million in
the first nine months of 2003. Favorable foreign currency exchange accounted
for approximately $30 million of the sales increase.
Net earnings for the first nine months of 2004 were $69.0 million, or
$1.17 per diluted share, compared to $23.5 million, or $0.40 per diluted share
for the same period in the prior year. 2004 year-to-date net earnings include
the previously mentioned $13.0 million pre-tax gain from the sale of a
European joint venture interest and $1.5 million in tax benefits resulting
from the favorable completion of tax audits. The prior-year period included
$4.0 million in tax benefits resulting from the favorable completion of tax
audits and the previously noted favorable settlement of a commercial lawsuit.
CASH POSITION
Thomas & Betts continues to improve its cash position and ended the third
quarter 2004 with $334.6 million in cash and cash equivalents, up $67.1
million from the end of the second quarter. This improvement reflects
primarily earnings and proceeds from the sale of a minority interest in a
European joint venture.
2004 DIRECTIONAL GUIDANCE
"We are expecting modest volume improvement in the fourth quarter compared
to last year, except in Steel Structures where demand is significantly
stronger. Based on this outlook, we believe that our full-year 2004 net
earnings per diluted share will fall within the range of $1.48 to $1.53, a
substantial improvement over the $0.73 per share reported in 2003," concluded
Pileggi.
Corporate Overview
Thomas & Betts Corporation ( http://www.tnb.com ) is a leading designer
and manufacturer of electrical connectors and components used in industrial,
commercial, communications and utility markets. The company is also a leading
producer of commercial heating units and highly engineered steel structures
used, among other things, for utility transmission. Headquartered in Memphis,
Tenn., the company has manufacturing, distribution and office facilities
worldwide.
NOTE: The following financial tables support the information in this news
release:
Consolidated Statements of Operations
Segment Information
Consolidated Balance Sheets
Consolidated Statements of Cash Flows
CONFERENCE CALL AND WEBCAST INFORMATION
Thomas & Betts will hold a conference call/webcast to discuss the
company's third quarter 2004 results on Tuesday, October 26, 2004 at 11:00 am
EDT (10:00 am CDT). To access the call, please call 201-689-8037. No
confirmation code is required to participate in the conference call. The call
can also be accessed via the Investor Relations section of the Thomas & Betts
corporate website at http://www.tnb.com.
The conference call will be recorded and available for replay through
12:00 midnight (Eastern) on Monday, November 1, 2004. To access the replay,
please call 201-612-7415, account number 9517, pass code 116756. The recorded
web cast will also be available at http://www.tnb.com.
CAUTIONARY STATEMENT
This press release includes forward-looking statements that are identified
by terms such as "optimistic," "trend," "will," and "believe." These
statements discuss business strategies, economic outlook and future
performance. These forward-looking statements make assumptions regarding the
company's operations, business, economic and political environment, including,
without limitation, customer demand, government regulation, terrorist acts and
acts of war. The actual results may be materially different from any future
results expressed or implied by such forward-looking statements. Please see
the "Business Risks" section of the company's Form 10-K for the fiscal year
ended December 31, 2003, for further information related to these
uncertainties. The company undertakes no obligation to publicly release any
revisions to any forward-looking statements contained in this press release to
reflect events or circumstances occurring after the date of this release or to
reflect the occurrence of unanticipated events.
THOMAS & BETTS CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Quarter Ended Year to Date
September September September September
30, 28, 30, 28,
2004 2003 2004 2003
Net sales $394,211 $338,691 $1,116,172 $972,834
Cost of sales 284,237 254,172 799,245 719,760
Gross margin 109,974 84,519 316,927 253,074
Gross margin -
% of net sales 27.9% 25.0% 28.4% 26.0%
Selling, general and
administrative 68,663 66,950 213,311 208,500
Selling, general and
administrative - % of
net sales 17.4% 19.8% 19.1% 21.4%
Other operating expense
(income), net - (8,850) - (8,850)
Earnings from operations 41,311 26,419 103,616 53,424
Income from
unconsolidated
companies 632 441 1,852 1,853
Interest expense, net (8,162) (9,682) (23,260) (27,101)
Other (expense) income,
net 995 (1,079) (97) (1,450)
Gain on sale of equity
interest 12,978 - 12,978 -
Earnings before income
taxes 47,754 16,099 95,089 26,726
Income tax provision 14,326 4,347 26,080 3,216
Net earnings $33,428 $11,752 $69,009 $23,510
Net earnings per share:
Basic earnings per
share $0.57 $0.20 $1.18 $0.40
Diluted earnings per
share $0.56 $0.20 $1.17 $0.40
Average shares
outstanding:
Basic 58,724 58,466 58,513 58,428
Diluted 59,468 58,473 59,128 58,433
THOMAS & BETTS CORPORATION AND SUBSIDIARIES
Segment Information
(In thousands)
(Unaudited)
Quarter Ended Year to Date
September September September September
30, 28, 30, 28,
2004 2003 2004 2003
Net sales:
Electrical $323,750 $289,389 $932,449 $828,643
Steel Structures 42,423 23,545 98,504 66,856
HVAC 28,038 25,757 85,219 77,335
Total net sales $394,211 $338,691 $1,116,172 $972,834
Segment earnings:
Electrical $34,165 $17,634 $90,846 $42,647
Steel Structures 5,910 2,680 9,091 4,202
HVAC 1,868 1,353 5,531 3,235
Total reportable
segment earnings 41,943 21,667 105,468 50,084
Total reportable
segment earnings -
% of net sales 10.6% 6.4% 9.4% 5.1%
Interest expense, net (8,162) (9,682) (23,260) (27,101)
Gain on sale of equity
interest 12,978 - 12,978 -
Other 995 4,114 (97) 3,743
Earnings before income
taxes $47,754 $16,099 $95,089 $26,726
THOMAS & BETTS CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands)
(Unaudited)
September 30, December 31,
2004 2003
ASSETS
Current assets:
Cash and cash equivalents $334,566 $387,425
Marketable securities 1,758 1,704
Receivables, net 216,563 168,542
Inventories 215,618 190,243
Other current assets 58,809 64,365
Total current assets 827,314 812,279
Net property, plant and equipment 276,473 303,710
Goodwill 455,391 455,113
Investments in unconsolidated
companies 114,383 121,732
Other assets 81,190 89,791
Total assets $1,754,751 $1,782,625
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term
debt $8,989 $133,344
Accounts payable 138,155 113,724
Accrued liabilities 105,599 111,478
Income taxes payable 11,035 6,414
Total current liabilities 263,778 364,960
Long-term debt 546,077 551,972
Other long-term liabilities 128,892 134,266
Shareholders' equity 816,004 731,427
Total liabilities and
shareholders' equity $1,754,751 $1,782,625
THOMAS & BETTS CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Year to Date
September September
30, 28,
2004 2003
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $69,009 $23,510
Adjustments:
Depreciation and amortization 39,739 37,455
Amortization of restricted stock 1,959 2,075
Gain on sale of equity interest (12,978) -
Changes in operating assets and
liabilities, net:
Receivables (47,797) (28,288)
Inventories (25,018) 10,232
Accounts payable 24,311 (2,605)
Accrued liabilities (6,023) (3,554)
Income taxes payable 4,420 (2,961)
Other 11,400 663
Net cash provided by operating
activities 59,022 36,527
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and
equipment (15,604) (19,392)
Proceeds from sale of property, plant
and equipment 4,941 266
Proceeds from sale of equity interest 20,929 -
Net proceeds from (investments in)
marketable securities (77) 48,336
Net cash provided by (used in)
investing activities 10,189 29,210
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term debt and
other borrowings - 125,191
Repayment of long-term debt and other
borrowings (130,791) (65,341)
Other 7,069 (3,807)
Net cash provided by (used in)
financing activities (123,722) 56,043
EFFECT OF EXCHANGE RATE ON CASH 1,652 6,031
Net increase (decrease) in cash and
cash equivalents (52,859) 127,811
Cash and cash equivalents at
beginning of period 387,425 177,994
Cash and cash equivalents at end of
period $334,566 $305,805
Cash payments for interest $35,088 $38,586
Cash payments for income taxes $10,528 $13,231
SOURCE Thomas & Betts Corporation
-0- 10/25/2004
/CONTACT: Tricia Bergeron of Thomas & Betts Corporation, +1-901-252-8266,
or tricia.bergeron@tnb.com /
/Web site: http://www.tnb.com /
(TNB)
CO: Thomas & Betts Corporation
ST: Tennessee
IN: CPR
SU: ERN ERP CCA MAV