Belden Reports Fourth Quarter and Full Year 2011 Results and Reaffirms 2012 Guidance

News provided by

Belden Inc.

Feb 09, 2012, 07:30 ET

ST. LOUIS, Feb. 9, 2012 /PRNewswire/ -- Belden Inc. (NYSE: BDC), a global leader in signal transmission solutions for mission critical applications, today reported fiscal fourth quarter and full year 2011 results for the period ended December 31, 2011.

Fourth Quarter Highlights

  • Increased income from continuing operations per diluted share to $0.57, up 159% over last year's $0.22 per diluted share;
  • Grew revenue 9.2% year-over-year to $464.4 million, from $425.2 million in the fourth quarter 2010;
  • Purchased 768,000 shares of Belden common stock for $25.0 million under the previously announced share repurchase program, and
  • Reaffirms full-year guidance for fiscal 2012 to revenues of $1.98 – $2.03 billion and income from continuing operations per diluted share of $2.70 – $2.90.

Full Year 2011 Highlights

  • Increased income from continuing operations per diluted share to $2.40, up 66% over last year's $1.45 per diluted share;
  • Grew revenue 23% to $1.98 billion, from $1.62 billion in 2010, and
  • Generated $145.7 million in free cash flow, exceeding net income for the year and up 70% over 2010.

Fourth Quarter 2011

Revenue for the quarter totaled $464.4 million, up $39.2 million, or 9.2%, compared to $425.2 million in the fourth quarter 2010.  Income from continuing operations per diluted share totaled $0.57, compared to $0.22 in the fourth quarter 2010.

John Stroup, President and CEO of Belden Inc., said, "Our fourth quarter results reflect a solid finish to a strong year.  End-market demand for Belden products remains healthy as evidenced by our sell-through performance.   In response to an uncertain economic environment, volatile commodity prices, and shorter lead-times, our customers and channel partners aggressively reduced inventory levels.  Due to similar economic concerns, we executed restructuring actions during the quarter to improve our cost position and flexibility in Europe and our consumer electronics business in Asia.  I am pleased that such actions could be accomplished in a quarter where earnings grew 159% year-over-year."  

The fourth quarter 2011 results include $7.6 million of non-recurring charges, primarily restructuring charges in Europe and China, and favorable non-recurring tax items with an impact of $5.5 million.  

Full Year 2011

Revenue for the year totaled $1.98 billion, up $360 million or 23% compared to $1.62 billion in 2010.  Operating income totaled $187 million or 9.4% of revenue for the year, compared to $129 million or 8.0% of revenue in 2010.  Income from continuing operations per diluted share totaled $2.40 for the year, compared to $1.45 in 2010, a 66% increase.

Mr. Stroup remarked, "I am extremely pleased with the Company's 2011 results, which include 66% earnings growth, 12% organic growth and robust free cash flow at 127% of net income."

Outlook

"Global economic forecasts predict modest growth in the world economy in 2012, which could continue to weaken, should the European economic situation deteriorate.  We are focusing on our strategic goals, including our Market Delivery System and Lean Enterprise initiatives, which position us to perform in this uncertain environment.  We are, therefore, reaffirming our previous outlook for 2012," said Mr. Stroup.

The Company expects first quarter 2012 revenues to be $445 million to $455 million, and income from continuing operations per diluted share to be $0.48 to $0.53.  For the full year ending December 31, 2012, the Company expects revenues to be $1.98 billion to $2.03 billion, and income from continuing operations per diluted share to be $2.70 to $2.90.

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 Web site for a limited time.

Use of Non-GAAP Financial Information

Non-GAAP measures 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 Web site 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 cable, connectivity and networking industries; variability in the Company's quarterly and annual effective tax rates; changes in accounting rules and interpretation of these rules which 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, 2010, filed with the SEC on February 25, 2011. Belden disclaims any duty to update any forward looking statements as a result of new information, future developments, or otherwise.

About Belden

St. Louis−based Belden Inc. designs, manufactures, and markets cable, connectivity, and networking products in markets including industrial automation, enterprise, transportation, infrastructure, and consumer electronics. It has approximately 6,800 employees, and provides value for industrial automation, enterprise, education, healthcare, entertainment and broadcast, sound and security, transportation, infrastructure, consumer electronics and other industries. Belden has manufacturing capabilities in North America, South America, Europe, and Asia, and a market presence in nearly every region of the world. Belden was founded in 1902, and today is a leader with some of the strongest brands in the signal transmission industry. For more information, visit www.belden.com.

Contact:

Belden Investor Relations

314-854-8054

[email protected]


BELDEN INC.







CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



























Three Months Ended

Twelve Months Ended


December 31, 2011

December 31, 2010

December 31, 2011

December 31, 2010


(In thousands, except per share data)









Revenues

$                  464,361

$                  425,176

$               1,981,953

$               1,617,090

Cost of sales

(332,362)

(303,780)

(1,410,134)

(1,149,796)

     Gross profit

131,999

121,396

571,819

467,294

Selling, general and administrative expenses

(81,279)

(76,371)

(325,950)

(279,677)

Research and development

(13,911)

(11,499)

(55,711)

(42,605)

Amortization of intangibles

(3,375)

(3,289)

(13,772)

(11,189)

Income from equity method investment

3,973

3,035

13,169

11,940

Asset impairment

(2,549)

(16,574)

(2,549)

(16,574)

     Operating income

34,858

16,698

187,006

129,189

Interest expense

(11,880)

(10,916)

(48,126)

(49,826)

Interest income

485

786

1,011

1,184

Other income


-

-

-

1,465

     Income from continuing operations before taxes


23,463

6,568

139,891

82,012

Income tax benefit (expense)

3,526

4,171

(24,638)

(12,714)

     Income from continuing operations

26,989

10,739

115,253

69,298

Gain (loss) from discontinued operations, net of tax

(462)

849

(908)

(5,686)

Gain on disposal of discontinued operations, net of tax

-

44,847

-

44,847

     Net income


$                    26,527

$                    56,435

$                  114,345

$                  108,459


















Weighted average number of common







   shares and equivalents:







   Basic

46,472

46,936

47,109

46,805

   Diluted

47,415

48,134

48,104

47,783









Basic income (loss) per share







   Continuing operations

$                        0.58

$                        0.23

$                        2.45

$                        1.48

   Discontinued operations

(0.01)

0.02

(0.02)

(0.11)

   Disposal of discontinued operations

-

0.95

-

0.95

   Net income


$                        0.57

$                        1.20

$                        2.43

$                        2.32









Diluted income (loss) per share







   Continuing operations

$                        0.57

$                        0.22

$                        2.40

$                        1.45

   Discontinued operations

(0.01)

0.02

(0.02)

(0.11)

   Disposal of discontinued operations

-

0.93

-

0.93

   Net income


$                        0.56

$                        1.17

$                        2.38

$                        2.27









Dividends declared per share

$                        0.05

$                        0.05

$                        0.20

$                        0.20

BELDEN INC.











OPERATING SEGMENT INFORMATION

(Unaudited)





































Three Months Ended December 31, 2011






Total




Americas

EMEA

Asia Pacific

Segments

Eliminations

Total


(In thousands)

External customer revenues

$      288,839

$        92,441

$        83,081

$      464,361

$                 -

$       464,361

Affiliate revenues

8,978

36,348

520

45,846

(45,846)

-

Total revenues

$      297,817

$      128,789

$        83,601

$      510,207

$        (45,846)

$       464,361













Operating income

$        33,233

$        20,763

$          2,762

$        56,758

$        (21,900)

$         34,858


























Three Months Ended December 31, 2010























External customer revenues

$      248,834

$        92,656

$        83,686

$      425,176

$                 -

$       425,176

Affiliate revenues

12,294

23,156

-

35,450

(35,450)

-

Total revenues

$      261,128

$      115,812

$        83,686

$      460,626

$        (35,450)

$       425,176













Operating income

$        17,318

$          5,939

$          7,383

$        30,640

$        (13,942)

$         16,698







































Twelve Months Ended December 31, 2011























External customer revenues

$   1,216,817

$      415,342

$      349,794

$   1,981,953

$                 -

$    1,981,953

Affiliate revenues

42,440

117,291

1,178

160,909

(160,909)

-

Total revenues

$   1,259,257

$      532,633

$      350,972

$   2,142,862

$      (160,909)

$    1,981,953













Operating income

$      144,820

$        84,097

$        25,343

$      254,260

$        (67,254)

$       187,006


























Twelve Months Ended December 31, 2010























External customer revenues

$      935,819

$      365,796

$      315,475

$   1,617,090

$                 -

$    1,617,090

Affiliate revenues

48,899

76,485

62

125,446

(125,446)

-

Total revenues

$      984,718

$      442,281

$      315,537

$   1,742,536

$      (125,446)

$    1,617,090













Operating income

$        98,633

$        47,091

$        29,555

$      175,279

$        (46,090)

$       129,189

BELDEN INC.







SUPPLEMENTAL PRODUCT GROUP INFORMATION

(Unaudited)

























Three Months Ended December 31, 2011








Americas

EMEA

Asia Pacific

Total


(In thousands)

Cable products

$      217,367

$        38,280

$        66,628

$      322,275

Networking products

28,110

33,777

13,150

75,037

Connectivity products

43,362

20,384

3,303

67,049

Total revenues

$      288,839

$        92,441

$        83,081

$      464,361









Three Months Ended December 31, 2010















Cable products

$      208,392

$        37,588

$        67,722

$      313,702

Networking products

17,284

28,237

11,800

57,321

Connectivity products

23,158

26,831

4,164

54,153

Total revenues

$      248,834

$        92,656

$        83,686

$      425,176









Twelve Months Ended December 31, 2011















Cable products

$      937,154

$      167,666

$      281,047

$   1,385,867

Networking products

109,400

144,895

52,893

307,188

Connectivity products

170,263

102,781

15,854

288,898

Total revenues

$   1,216,817

$      415,342

$      349,794

$   1,981,953









Twelve Months Ended December 31, 2010















Cable products

$      798,833

$      152,018

$      263,020

$   1,213,871

Networking products

62,015

115,700

36,536

214,251

Connectivity products

74,971

98,078

15,919

188,968

Total revenues

$      935,819

$      365,796

$      315,475

$   1,617,090

BELDEN INC.



CONDENSED CONSOLIDATED BALANCE SHEETS





December 31, 2011

December 31, 2010


(Unaudited)



(In thousands)

ASSETS

Current assets:



Cash and cash equivalents

$                  382,716

$                  358,653

Receivables, net

299,070

298,266

Inventories, net

202,143

175,659

Deferred income taxes

19,660

9,473

Other current assets

21,832

18,804





Total current assets

925,421

860,855





Property, plant and equipment, less accumulated depreciation

286,933

278,866

Goodwill

348,032

322,556

Intangible assets, less accumulated amortization

151,683

143,820

Deferred income taxes

12,219

27,565

Other long-lived assets

63,832

62,822







$               1,788,120

$               1,696,484





LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:



Accounts payable

$                  227,571

$                  212,084

Accrued liabilities

153,995

145,840





Total current liabilities

381,566

357,924





Long-term debt

550,926

551,155

Postretirement benefits

131,237

112,426

Other long-term liabilities

29,842

36,464

Stockholders’ equity:



Common stock

503

503

Additional paid-in capital

601,484

595,519

Retained earnings

276,363

171,568

Accumulated other comprehensive loss

(22,709)

(8,919)

Treasury stock

(161,092)

(120,156)





Total stockholders’ equity


694,549

638,515







$               1,788,120

$               1,696,484

BELDEN INC.


CONDENSED CONSOLIDATED CASH FLOW STATEMENTS

(Unaudited)







Twelve Months Ended


December 31, 2011

December 31, 2010

(In thousands)

Cash flows from operating activities:


   Net income

$                  114,345

$                  108,459

   Adjustments to reconcile net income to net cash provided by operating activities:




       Depreciation and amortization

50,174

55,279

       Share-based compensation

11,241

12,177

       Pension funding less than (greater than) pension expense

3,812

(4,289)

       Asset impairment

2,549

16,574

       Deferred income tax expense (benefit)

2,294

(11,577)

       Provision for inventory obsolescence

1,160

3,210

       Non-cash loss on derivatives and hedging instruments

-

2,893

       Gain on sale of assets

-

(44,847)

       Tax deficiency (benefit) related to share-based compensation

(1,790)

110

       Income from equity method investment

(13,169)

(11,940)

       Changes in operating assets and liabilities, net of the effects of currency exchange


         rate changes and acquired businesses:


           Receivables

4,680

(39,458)

           Inventories

(22,873)

(14,031)

           Accounts payable

9,281

38,513

           Accrued liabilities

12,317

(8,203)

           Accrued taxes

(55)

(3,793)

           Other assets

12,219

27,209

           Other liabilities

(1,622)

(14,737)

               Net cash provided by operating activities

184,563

111,549




Cash flows from investing activities:


   Cash used to acquire businesses, net of cash acquired

(60,519)

(119,110)

   Capital expenditures

(40,053)

(28,194)

   Proceeds from disposal of businesses and tangible assets

1,213

138,952

               Net cash used for investing activities

(99,359)

(8,352)




Cash flows from financing activities:


Payments under share repurchase program

(50,000)

-

   Cash dividends paid

(9,410)

(9,412)

   Debt issuance costs

(3,296)

-

   Payments under borrowing arrangements

-

(46,268)

   Cash received upon termination of derivative instruments

-

4,217

   Tax benefit (deficiency) related to share-based compensation

1,790

(110)

   Proceeds from exercise of stock options

4,599

3,158

               Net cash used for financing activities

(56,317)

(48,415)




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

(4,824)

(5,008)




Increase in cash and cash equivalents

24,063

49,774

Cash and cash equivalents, beginning of period

358,653

308,879

Cash and cash equivalents, end of period

$                  382,716

$                  358,653

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 less capital expenditures, net of proceeds from the disposal of tangible assets.  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

Three Months Ended

Twelve Months Ended


Twelve Months Ended



December 31, 2011

December 31, 2010

December 31, 2011

December 31, 2010


(In thousands)

GAAP net cash provided by operating activities

$                        85,101

$                        56,138

$                          184,563

$                          111,549

Capital expenditures, net of proceeds from









the disposal of tangible assets

(18,286)

(8,903)

(38,840)

(25,769)

Non-GAAP free cash flow

$                        66,815

$                        47,235

$                          145,723

$                            85,780

SOURCE Belden Inc.

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