Belden Inc. (NYSE: BDC), a leading global supplier of network infrastructure solutions, today reported fiscal third quarter 2022 results for the period ended October 2, 2022.
Third Quarter 2022
Revenues for the quarter totaled $670 million, increasing $65 million, or 11%, compared to $605 million in the year-ago period. Net income was $104 million, compared to $44 million in the year-ago period. Net income as a percentage of revenue was 15.5%, compared to 7.3% in the year-ago period. Net income in the quarter included a $38 million pre-tax gain on the sale of an asset. EPS totaled a quarterly record $2.35, compared to $0.97 in the third quarter 2021.
Adjusted revenues for the quarter totaled $670 million, increasing $65 million, or 11%, compared to $605 million in the year-ago period. Adjusted EBITDA was $118 million, increasing $17 million, or 17%, compared to $101 million in the year-ago period. Adjusted EBITDA margin was 17.6%, compared to 16.7% in the year-ago period. Adjusted EPS was a quarterly record $1.77, increasing 33% compared to $1.33 in the third quarter 2021. Adjusted results are non-GAAP measures, and a non-GAAP reconciliation table is provided as an appendix to this release.
Roel Vestjens, President and CEO of Belden Inc., said, “I am pleased with our third quarter performance and the strong execution by our global teams to meet the needs of our customers and deliver record quarterly EPS. Revenues increased organically by 15% in the third quarter. Once again, the strength was broad-based, with each of our businesses growing organically, demonstrating the strength and strategic positioning of our portfolio. Despite facing continued inflationary pressures, we delivered strong profitability, with expanded margins and 33% Adjusted EPS growth. Additionally, we continued to return capital to shareholders, while ending the quarter with net leverage of 1.1x.”
Outlook
“As a result of another strong quarter and an improved outlook for the fourth quarter, we are increasing our full-year 2022 guidance. Our full-year revenue guidance now reflects expected organic revenue growth of 15% to 16%, up from 12% to 13% in our prior guidance. The macroeconomic environment remains very dynamic with considerable uncertainties, including volatile foreign exchange rates and commodity prices. However, we have significant levels of customer backlog, and we continue to gain momentum with our strategic growth initiatives. We remain confident in our ability to support our customers, create value for our shareholders, and deliver at least $8.00 of adjusted EPS by 2025,” said Mr. Vestjens.
The Company expects fourth quarter 2022 revenues to be $635 - $650 million. Compared to third quarter 2022 revenues, the Company expects fourth quarter 2022 revenues to be lower due to a stronger U.S. dollar and typical seasonal patterns.
For the year ending December 31, 2022, the Company now expects revenues to be $2.583 - $2.598 billion, compared to prior guidance of $2.520 - $2.550 billion. The full-year revenue guidance now reflects expected organic growth of 15% - 16%, compared to prior guidance of 12% to 13%.
The Company expects fourth quarter 2022 GAAP EPS to be $1.27 - $1.37. For the year ending December 31, 2022, the Company now expects GAAP EPS to be $5.89 - $5.99, compared to prior guidance of $4.67 - $4.87.
The Company expects fourth quarter 2022 adjusted EPS to be $1.60 - $1.70. For the year ending December 31, 2022, the Company now expects adjusted EPS to be $6.27 - $6.37, compared to prior guidance of $5.90 - $6.10. The full-year adjusted EPS guidance now represents growth of 32% to 34%.
Earnings Conference Call
Management will host a conference call today at 8:30 am ET to discuss results of the quarter. The listen-only audio of the conference call will be broadcast live via the Internet at https://investor.belden.com. The dial-in number for participants is 800-458-4121 with confirmation code 7787011. A replay of this conference call will remain accessible in the investor relations section of the Company’s website for a limited time.
Net Income, Earnings per Share (EPS), and Net Leverage
All references to net income and EPS within this earnings release refer to income from continuing operations and income from continuing operations per diluted share attributable to Belden stockholders, respectively. Net leverage is calculated as (A) total debt less cash and cash equivalents divided by (B) the sum of trailing twelve months Adjusted EBITDA plus trailing twelve months stock-based compensation expense.
Use of Non-GAAP Financial Information
Adjusted results are non-GAAP measures that reflect certain adjustments the Company makes to provide insight into operating results. GAAP to non-GAAP reconciliations accompany the condensed consolidated financial statements included in this release and have been published to the investor relations section of the Company’s website at https://investor.belden.com.
BELDEN INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) |
||||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
October 2, 2022 |
|
October 3, 2021 |
|
October 2, 2022 |
|
October 3, 2021 |
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
(In thousands, except per share data) |
||||||||||||||
Revenues |
|
$ |
670,491 |
|
|
$ |
604,761 |
|
|
$ |
1,947,413 |
|
|
$ |
1,689,301 |
|
Cost of sales |
|
|
(431,845 |
) |
|
|
(401,384 |
) |
|
|
(1,277,602 |
) |
|
|
(1,125,387 |
) |
Gross profit |
|
|
238,646 |
|
|
|
203,377 |
|
|
|
669,811 |
|
|
|
563,914 |
|
Selling, general and administrative expenses |
|
|
(110,478 |
) |
|
|
(95,337 |
) |
|
|
(318,747 |
) |
|
|
(269,542 |
) |
Research and development expenses |
|
|
(26,306 |
) |
|
|
(23,235 |
) |
|
|
(75,751 |
) |
|
|
(68,110 |
) |
Amortization of intangibles |
|
|
(10,105 |
) |
|
|
(7,780 |
) |
|
|
(28,099 |
) |
|
|
(22,945 |
) |
Asset impairments |
|
|
— |
|
|
|
(2,288 |
) |
|
|
— |
|
|
|
(9,283 |
) |
Gain on sale of asset |
|
|
37,891 |
|
|
|
— |
|
|
|
37,891 |
|
|
|
— |
|
Operating income |
|
|
129,648 |
|
|
|
74,737 |
|
|
|
285,105 |
|
|
|
194,034 |
|
Interest expense, net |
|
|
(9,883 |
) |
|
|
(16,251 |
) |
|
|
(35,570 |
) |
|
|
(46,632 |
) |
Loss on debt extinguishment |
|
|
— |
|
|
|
(5,715 |
) |
|
|
(6,392 |
) |
|
|
(5,715 |
) |
Non-operating pension benefit |
|
|
26 |
|
|
|
992 |
|
|
|
2,296 |
|
|
|
3,121 |
|
Income from continuing operations before taxes |
|
|
119,791 |
|
|
|
53,763 |
|
|
|
245,439 |
|
|
|
144,808 |
|
Income tax expense |
|
|
(16,104 |
) |
|
|
(9,799 |
) |
|
|
(39,014 |
) |
|
|
(26,433 |
) |
Income from continuing operations |
|
|
103,687 |
|
|
|
43,964 |
|
|
|
206,425 |
|
|
|
118,375 |
|
Loss from discontinued operations, net of tax |
|
|
— |
|
|
|
(2,647 |
) |
|
|
(3,685 |
) |
|
|
(4,345 |
) |
Loss on disposal of discontinued operations, net of tax |
|
|
(5,366 |
) |
|
|
— |
|
|
|
(9,933 |
) |
|
|
— |
|
Net income |
|
|
98,321 |
|
|
|
41,317 |
|
|
|
192,807 |
|
|
|
114,030 |
|
Less: Net income attributable to noncontrolling interest |
|
|
27 |
|
|
|
53 |
|
|
|
111 |
|
|
|
336 |
|
Net income attributable to Belden stockholders |
|
$ |
98,294 |
|
|
$ |
41,264 |
|
|
$ |
192,696 |
|
|
$ |
113,694 |
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of common shares and equivalents: |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
|
43,466 |
|
|
|
44,851 |
|
|
|
44,181 |
|
|
|
44,762 |
|
Diluted |
|
|
44,063 |
|
|
|
45,425 |
|
|
|
44,810 |
|
|
|
45,242 |
|
|
|
|
|
|
|
|
|
|
||||||||
Basic income (loss) per share attributable to Belden stockholders: |
|
|
|
|
|
|
|
|
||||||||
Continuing operations |
|
$ |
2.38 |
|
|
$ |
0.98 |
|
|
$ |
4.67 |
|
|
$ |
2.64 |
|
Discontinued operations |
|
|
— |
|
|
|
(0.06 |
) |
|
|
(0.08 |
) |
|
|
(0.10 |
) |
Disposal of discontinued operations |
|
|
(0.12 |
) |
|
|
— |
|
|
|
(0.22 |
) |
|
|
— |
|
Net income |
|
$ |
2.26 |
|
|
$ |
0.92 |
|
|
$ |
4.36 |
|
|
$ |
2.54 |
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted income (loss) per share attributable to Belden stockholders: |
|
|
|
|
|
|
|
|
||||||||
Continuing operations |
|
$ |
2.35 |
|
|
$ |
0.97 |
|
|
$ |
4.60 |
|
|
$ |
2.61 |
|
Discontinued operations |
|
|
— |
|
|
|
(0.06 |
) |
|
|
(0.08 |
) |
|
|
(0.10 |
) |
Disposal of discontinued operations |
|
|
(0.12 |
) |
|
|
— |
|
|
|
(0.22 |
) |
|
|
— |
|
Net income |
|
$ |
2.23 |
|
|
$ |
0.91 |
|
|
$ |
4.30 |
|
|
$ |
2.51 |
|
|
|
|
|
|
|
|
|
|
||||||||
Common stock dividends declared per share |
|
$ |
0.05 |
|
|
$ |
0.05 |
|
|
$ |
0.15 |
|
|
$ |
0.15 |
|
BELDEN INC. OPERATING SEGMENT INFORMATION (Unaudited) |
||||||||||||
|
|
Enterprise Solutions |
|
Industrial Automation Solutions |
|
Total Segments |
||||||
|
|
|
|
|
|
|
||||||
|
(In thousands, except percentages) |
|||||||||||
|
|
|
|
|
|
|
||||||
For the three months ended October 2, 2022 |
|
|
|
|
|
|
||||||
Segment Revenues |
|
$ |
319,201 |
|
|
$ |
351,290 |
|
|
$ |
670,491 |
|
Segment EBITDA |
|
|
46,110 |
|
|
|
71,055 |
|
|
|
117,165 |
|
Segment EBITDA margin |
|
|
14.4 |
% |
|
|
20.2 |
% |
|
|
17.5 |
% |
Depreciation expense |
|
|
6,020 |
|
|
|
5,827 |
|
|
|
11,847 |
|
Amortization of intangibles |
|
|
4,512 |
|
|
|
5,593 |
|
|
|
10,105 |
|
Amortization of software development intangible assets |
|
|
8 |
|
|
|
860 |
|
|
|
868 |
|
Severance, restructuring, and acquisition integration costs |
|
|
2,702 |
|
|
|
1,858 |
|
|
|
4,560 |
|
Adjustments related to acquisitions and divestitures |
|
|
(2,537 |
) |
|
|
514 |
|
|
|
(2,023 |
) |
|
|
|
|
|
|
|
||||||
For the three months ended October 3, 2021 |
|
|
|
|
|
|
||||||
Segment Revenues |
|
$ |
286,231 |
|
|
$ |
319,032 |
|
|
$ |
605,263 |
|
Segment EBITDA |
|
|
40,411 |
|
|
|
59,947 |
|
|
|
100,358 |
|
Segment EBITDA margin |
|
|
14.1 |
% |
|
|
18.8 |
% |
|
|
16.6 |
% |
Depreciation expense |
|
|
5,280 |
|
|
|
5,306 |
|
|
|
10,586 |
|
Amortization of intangibles |
|
|
4,427 |
|
|
|
3,353 |
|
|
|
7,780 |
|
Amortization of software development intangible assets |
|
|
20 |
|
|
|
414 |
|
|
|
434 |
|
Severance, restructuring, and acquisition integration costs |
|
|
3,381 |
|
|
|
947 |
|
|
|
4,328 |
|
Adjustments related to acquisitions and divestitures |
|
|
(713 |
) |
|
|
890 |
|
|
|
177 |
|
Asset impairments |
|
|
— |
|
|
|
2,288 |
|
|
|
2,288 |
|
|
|
|
|
|
|
|
||||||
For the nine months ended October 2, 2022 |
|
|
|
|
|
|
||||||
Segment Revenues |
|
$ |
895,075 |
|
|
$ |
1,052,338 |
|
|
$ |
1,947,413 |
|
Segment EBITDA |
|
|
118,818 |
|
|
|
206,643 |
|
|
|
325,461 |
|
Segment EBITDA margin |
|
|
13.3 |
% |
|
|
19.6 |
% |
|
|
16.7 |
% |
Depreciation expense |
|
|
17,214 |
|
|
|
17,229 |
|
|
|
34,443 |
|
Amortization of intangibles |
|
|
13,051 |
|
|
|
15,048 |
|
|
|
28,099 |
|
Amortization of software development intangible assets |
|
|
52 |
|
|
|
2,804 |
|
|
|
2,856 |
|
Severance, restructuring, and acquisition integration costs |
|
|
7,605 |
|
|
|
6,535 |
|
|
|
14,140 |
|
Adjustments related to acquisitions and divestitures |
|
|
(3,095 |
) |
|
|
1,648 |
|
|
|
(1,447 |
) |
|
|
|
|
|
|
|
||||||
For the nine months ended October 3, 2021 |
|
|
|
|
|
|
||||||
Segment Revenues |
|
$ |
780,114 |
|
|
$ |
910,538 |
|
|
$ |
1,690,652 |
|
Segment EBITDA |
|
|
104,703 |
|
|
|
163,022 |
|
|
|
267,725 |
|
Segment EBITDA margin |
|
|
13.4 |
% |
|
|
17.9 |
% |
|
|
15.8 |
% |
Depreciation expense |
|
|
16,015 |
|
|
|
15,956 |
|
|
|
31,971 |
|
Amortization of intangibles |
|
|
13,202 |
|
|
|
9,743 |
|
|
|
22,945 |
|
Amortization of software development intangible assets |
|
|
72 |
|
|
|
1,093 |
|
|
|
1,165 |
|
Severance, restructuring, and acquisition integration costs |
|
|
7,797 |
|
|
|
4,742 |
|
|
|
12,539 |
|
Adjustments related to acquisitions and divestitures |
|
|
(7,052 |
) |
|
|
2,767 |
|
|
|
(4,285 |
) |
Asset impairments |
|
|
— |
|
|
|
9,283 |
|
|
|
9,283 |
|
BELDEN INC. OPERATING SEGMENT RECONCILIATION TO CONSOLIDATED RESULTS (Unaudited) |
||||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
October 2, 2022 |
|
October 3, 2021 |
|
October 2, 2022 |
|
October 3, 2021 |
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
(In thousands) |
||||||||||||||
Total Segment Revenues |
|
$ |
670,491 |
|
|
$ |
605,263 |
|
|
$ |
1,947,413 |
|
|
$ |
1,690,652 |
|
Adjustments related to acquisitions |
|
|
— |
|
|
|
(502 |
) |
|
|
— |
|
|
|
(1,351 |
) |
Consolidated revenues |
|
$ |
670,491 |
|
|
$ |
604,761 |
|
|
$ |
1,947,413 |
|
|
$ |
1,689,301 |
|
|
|
|
|
|
|
|
|
|
||||||||
Total Segment EBITDA |
|
$ |
117,165 |
|
|
$ |
100,358 |
|
|
$ |
325,461 |
|
|
$ |
267,725 |
|
Total non-operating pension benefit |
|
|
26 |
|
|
|
992 |
|
|
|
2,296 |
|
|
|
3,121 |
|
Non-operating pension settlement loss |
|
|
954 |
|
|
|
— |
|
|
|
954 |
|
|
|
— |
|
Eliminations |
|
|
(51 |
) |
|
|
(28 |
) |
|
|
(156 |
) |
|
|
(73 |
) |
Consolidated Adjusted EBITDA (1) |
|
|
118,094 |
|
|
|
101,322 |
|
|
|
328,555 |
|
|
|
270,773 |
|
Depreciation expense |
|
|
(11,847 |
) |
|
|
(10,586 |
) |
|
|
(34,443 |
) |
|
|
(31,971 |
) |
Amortization of intangibles |
|
|
(10,105 |
) |
|
|
(7,780 |
) |
|
|
(28,099 |
) |
|
|
(22,945 |
) |
Interest expense, net |
|
|
(9,883 |
) |
|
|
(16,251 |
) |
|
|
(35,570 |
) |
|
|
(46,632 |
) |
Severance, restructuring, and acquisition integration costs |
|
|
(4,560 |
) |
|
|
(4,328 |
) |
|
|
(14,140 |
) |
|
|
(12,539 |
) |
Non-operating pension settlement loss |
|
|
(954 |
) |
|
|
— |
|
|
|
(954 |
) |
|
|
— |
|
Amortization of software development intangible assets |
|
|
(868 |
) |
|
|
(434 |
) |
|
|
(2,856 |
) |
|
|
(1,165 |
) |
Loss on debt extinguishment |
|
|
— |
|
|
|
(5,715 |
) |
|
|
(6,392 |
) |
|
|
(5,715 |
) |
Asset impairments |
|
|
— |
|
|
|
(2,288 |
) |
|
|
— |
|
|
|
(9,283 |
) |
Adjustments related to acquisitions and divestitures |
|
|
2,023 |
|
|
|
(177 |
) |
|
|
1,447 |
|
|
|
4,285 |
|
Gain on sale of asset |
|
|
37,891 |
|
|
|
— |
|
|
|
37,891 |
|
|
|
— |
|
Income from continuing operations before taxes |
|
$ |
119,791 |
|
|
$ |
53,763 |
|
|
$ |
245,439 |
|
|
$ |
144,808 |
|
(1) |
Consolidated Adjusted EBITDA is a non-GAAP measure. See Reconciliation of Non-GAAP Measures for additional information. |
BELDEN INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) |
||||||||
|
|
October 2, 2022 |
|
December 31, 2021 |
||||
|
|
|
|
|
||||
|
|
(In thousands) |
||||||
ASSETS |
||||||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
547,466 |
|
|
$ |
641,563 |
|
Receivables, net |
|
|
436,715 |
|
|
|
383,444 |
|
Inventories, net |
|
|
351,440 |
|
|
|
345,203 |
|
Other current assets |
|
|
48,987 |
|
|
|
58,283 |
|
Current assets of discontinued operations |
|
|
— |
|
|
|
449,402 |
|
Total current assets |
|
|
1,384,608 |
|
|
|
1,877,895 |
|
Property, plant and equipment, less accumulated depreciation |
|
|
332,458 |
|
|
|
343,564 |
|
Operating lease right-of-use assets |
|
|
69,940 |
|
|
|
75,571 |
|
Goodwill |
|
|
848,506 |
|
|
|
821,448 |
|
Intangible assets, less accumulated amortization |
|
|
243,916 |
|
|
|
238,155 |
|
Deferred income taxes |
|
|
29,702 |
|
|
|
31,486 |
|
Other long-lived assets |
|
|
51,366 |
|
|
|
29,558 |
|
|
|
$ |
2,960,496 |
|
|
$ |
3,417,677 |
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
Current liabilities: |
|
|
|
|
||||
Accounts payable |
|
$ |
297,759 |
|
|
$ |
377,765 |
|
Accrued liabilities |
|
|
247,743 |
|
|
|
278,108 |
|
Current liabilities of discontinued operations |
|
|
— |
|
|
|
99,079 |
|
Total current liabilities |
|
|
545,502 |
|
|
|
754,952 |
|
Long-term debt |
|
|
1,045,348 |
|
|
|
1,459,991 |
|
Postretirement benefits |
|
|
96,608 |
|
|
|
120,997 |
|
Deferred income taxes |
|
|
59,124 |
|
|
|
49,027 |
|
Long-term operating lease liabilities |
|
|
56,333 |
|
|
|
61,967 |
|
Other long-term liabilities |
|
|
22,907 |
|
|
|
14,661 |
|
Stockholders’ equity: |
|
|
|
|
||||
Common stock |
|
|
503 |
|
|
|
503 |
|
Additional paid-in capital |
|
|
822,488 |
|
|
|
833,627 |
|
Retained earnings |
|
|
691,722 |
|
|
|
505,717 |
|
Accumulated other comprehensive income (loss) |
|
|
37,126 |
|
|
|
(70,566 |
) |
Treasury stock |
|
|
(418,029 |
) |
|
|
(313,994 |
) |
Total Belden stockholders’ equity |
|
|
1,133,810 |
|
|
|
955,287 |
|
Noncontrolling interests |
|
|
864 |
|
|
|
795 |
|
Total stockholders’ equity |
|
|
1,134,674 |
|
|
|
956,082 |
|
|
|
$ |
2,960,496 |
|
|
$ |
3,417,677 |
|
BELDEN INC. CONDENSED CONSOLIDATED CASH FLOW STATEMENTS (Unaudited) |
||||||||
|
|
Nine Months Ended |
||||||
|
|
October 2, 2022 |
|
October 3, 2021 |
||||
|
|
|
|
|
||||
|
|
(In thousands) |
||||||
Cash flows from operating activities: |
|
|
|
|
||||
Net income |
|
$ |
192,807 |
|
|
$ |
114,030 |
|
Adjustments to reconcile net income to net cash from operating activities: |
|
|
|
|
||||
Depreciation and amortization |
|
|
65,730 |
|
|
|
65,028 |
|
Share-based compensation |
|
|
18,438 |
|
|
|
18,242 |
|
Loss on disposal of discontinued operations |
|
|
9,934 |
|
|
|
— |
|
Loss on debt extinguishment |
|
|
6,392 |
|
|
|
5,715 |
|
Asset impairments |
|
|
— |
|
|
|
9,283 |
|
Gain on sale of asset |
|
|
(37,891 |
) |
|
|
— |
|
Changes in operating assets and liabilities, net of the effects of currency exchange rate changes, acquired businesses and disposals: |
|
|
|
|
||||
Receivables |
|
|
(42,808 |
) |
|
|
(128,997 |
) |
Inventories |
|
|
(11,393 |
) |
|
|
(58,900 |
) |
Accounts payable |
|
|
(65,584 |
) |
|
|
73,740 |
|
Accrued liabilities |
|
|
(41,247 |
) |
|
|
17,796 |
|
Income taxes |
|
|
(2,347 |
) |
|
|
5,159 |
|
Other assets |
|
|
4,269 |
|
|
|
(1,794 |
) |
Other liabilities |
|
|
(17,500 |
) |
|
|
(17,383 |
) |
Net cash provided by operating activities |
|
|
78,800 |
|
|
|
101,919 |
|
Cash flows from investing activities: |
|
|
|
|
||||
Proceeds from disposal of businesses, net of cash sold |
|
|
334,574 |
|
|
|
10,798 |
|
Proceeds from disposal of assets |
|
|
43,534 |
|
|
|
3,249 |
|
Purchase of intangible assets |
|
|
— |
|
|
|
(3,650 |
) |
Capital expenditures |
|
|
(50,250 |
) |
|
|
(55,569 |
) |
Cash used for business acquisitions, net of cash acquired |
|
|
(104,481 |
) |
|
|
(73,749 |
) |
Net cash provided by (used for) investing activities |
|
|
223,377 |
|
|
|
(118,921 |
) |
Cash flows from financing activities: |
|
|
|
|
||||
Payments under borrowing arrangements |
|
|
(230,639 |
) |
|
|
(360,304 |
) |
Payments under share repurchase program |
|
|
(136,336 |
) |
|
|
— |
|
Cash dividends paid |
|
|
(6,762 |
) |
|
|
(6,740 |
) |
Withholding tax payments for share-based payment awards |
|
|
(6,534 |
) |
|
|
(2,103 |
) |
Payments under financing lease obligations |
|
|
(123 |
) |
|
|
(3,116 |
) |
Debt issuance costs paid |
|
|
— |
|
|
|
(7,785 |
) |
Proceeds from issuance of common stock |
|
|
3,717 |
|
|
|
— |
|
Borrowings under credit arrangements |
|
|
— |
|
|
|
356,010 |
|
Net cash used for financing activities |
|
|
(376,677 |
) |
|
|
(24,038 |
) |
Effect of foreign currency exchange rate changes on cash and cash equivalents |
|
|
(21,791 |
) |
|
|
(3,201 |
) |
Decrease in cash and cash equivalents |
|
|
(96,291 |
) |
|
|
(44,241 |
) |
Cash and cash equivalents, beginning of period |
|
|
643,757 |
|
|
|
501,994 |
|
Cash and cash equivalents, end of period |
|
$ |
547,466 |
|
|
$ |
457,753 |
|
The Condensed Consolidated Cash Flow Statement includes the results of discontinued operations up to the disposal date, February 22, 2022.
BELDEN INC.
RECONCILIATION OF NON-GAAP MEASURES
(Unaudited)
In addition to reporting financial results in accordance with accounting principles generally accepted in the United States, we provide non-GAAP operating results adjusted for certain items, including: asset impairments; accelerated depreciation expense due to plant consolidation activities; purchase accounting effects related to acquisitions, such as the adjustment of acquired inventory to fair value, and transaction costs; severance, restructuring, and acquisition integration costs; gains (losses) recognized on the disposal of businesses and assets; amortization of intangible assets; gains (losses) on debt extinguishment; certain gains (losses) from patent settlements; discontinued operations; and other costs. We adjust for the items listed above in all periods presented, unless the impact is clearly immaterial to our financial statements. When we calculate the tax effect of the adjustments, we include all current and deferred income tax expense commensurate with the adjusted measure of pre-tax profitability.
We utilize the adjusted results to review our ongoing operations without the effect of these adjustments and for comparison to budgeted operating results. We believe the adjusted results are useful to investors because they help them compare our results to previous periods and provide important insights into underlying trends in the business and how management oversees our business operations on a day-to-day basis. As an example, we adjust for acquisition-related expenses, such as amortization of intangibles and impacts of fair value adjustments because they generally are not related to the acquired business' core business performance. As an additional example, we exclude the costs of restructuring programs, which can occur from time to time for our current businesses and/or recently acquired businesses. We exclude the costs in calculating adjusted results to allow us and investors to evaluate the performance of the business based upon its expected ongoing operating structure. We believe the adjusted measures, accompanied by the disclosure of the costs of these programs, provides valuable insight.
Adjusted results should be considered only in conjunction with results reported according to accounting principles generally accepted in the United States.
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
October 2, 2022 |
|
October 3, 2021 |
|
October 2, 2022 |
|
October 3, 2021 |
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
(In thousands, except percentages and per share amounts) |
||||||||||||||
GAAP revenues |
|
$ |
670,491 |
|
|
$ |
604,761 |
|
|
$ |
1,947,413 |
|
|
$ |
1,689,301 |
|
Adjustments related to acquisitions |
|
|
— |
|
|
|
502 |
|
|
|
— |
|
|
|
1,351 |
|
Adjusted revenues |
|
$ |
670,491 |
|
|
$ |
605,263 |
|
|
$ |
1,947,413 |
|
|
$ |
1,690,652 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP gross profit |
|
$ |
238,646 |
|
|
$ |
203,377 |
|
|
$ |
669,811 |
|
|
$ |
563,914 |
|
Severance, restructuring, and acquisition integration costs |
|
|
2,796 |
|
|
|
2,943 |
|
|
|
8,771 |
|
|
|
4,306 |
|
Amortization of software development intangible assets |
|
|
868 |
|
|
|
434 |
|
|
|
2,856 |
|
|
|
1,165 |
|
Adjustments related to acquisitions and divestitures |
|
|
514 |
|
|
|
890 |
|
|
|
1,648 |
|
|
|
3,701 |
|
Adjusted gross profit |
|
$ |
242,824 |
|
|
$ |
207,644 |
|
|
$ |
683,086 |
|
|
$ |
573,086 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP gross profit margin |
|
|
35.6 |
% |
|
|
33.6 |
% |
|
|
34.4 |
% |
|
|
33.4 |
% |
Adjusted gross profit margin |
|
|
36.2 |
% |
|
|
34.3 |
% |
|
|
35.1 |
% |
|
|
33.9 |
% |
|
|
|
|
|
|
|
|
|
||||||||
GAAP selling, general and administrative expenses |
|
$ |
(110,478 |
) |
|
$ |
(95,337 |
) |
|
$ |
(318,747 |
) |
|
$ |
(269,542 |
) |
Severance, restructuring, and acquisition integration costs |
|
|
1,764 |
|
|
|
1,385 |
|
|
|
5,369 |
|
|
|
8,233 |
|
Adjustments related to acquisitions and divestitures |
|
|
(2,537 |
) |
|
|
(713 |
) |
|
|
(3,095 |
) |
|
|
(7,986 |
) |
Adjusted selling, general and administrative expenses |
|
$ |
(111,251 |
) |
|
$ |
(94,665 |
) |
|
$ |
(316,473 |
) |
|
$ |
(269,295 |
) |
|
|
|
|
|
|
|
|
|
||||||||
GAAP and adjusted research and development expenses |
|
$ |
(26,306 |
) |
|
$ |
(23,235 |
) |
|
$ |
(75,751 |
) |
|
$ |
(68,110 |
) |
|
|
|
|
|
|
|
|
|
||||||||
GAAP income from continuing operations |
|
$ |
103,687 |
|
|
$ |
43,964 |
|
|
$ |
206,425 |
|
|
$ |
118,375 |
|
Income tax expense |
|
|
16,104 |
|
|
|
9,799 |
|
|
|
39,014 |
|
|
|
26,433 |
|
Interest expense, net |
|
|
9,883 |
|
|
|
16,251 |
|
|
|
35,570 |
|
|
|
46,632 |
|
Non-operating pension settlement loss |
|
|
954 |
|
|
|
— |
|
|
|
954 |
|
|
|
— |
|
Loss on debt extinguishment |
|
|
— |
|
|
|
5,715 |
|
|
|
6,392 |
|
|
|
5,715 |
|
Total non-operating adjustments |
|
|
26,941 |
|
|
|
31,765 |
|
|
|
81,930 |
|
|
|
78,780 |
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of intangible assets |
|
|
10,105 |
|
|
|
7,780 |
|
|
|
28,099 |
|
|
|
22,945 |
|
Severance, restructuring, and acquisition integration costs |
|
|
4,560 |
|
|
|
4,328 |
|
|
|
14,140 |
|
|
|
12,539 |
|
Amortization of software development intangible assets |
|
|
868 |
|
|
|
434 |
|
|
|
2,856 |
|
|
|
1,165 |
|
Asset impairments |
|
|
— |
|
|
|
2,288 |
|
|
|
— |
|
|
|
9,283 |
|
Adjustments related to acquisitions and divestitures |
|
|
(2,023 |
) |
|
|
177 |
|
|
|
(1,447 |
) |
|
|
(4,285 |
) |
Gain on sale of asset |
|
|
(37,891 |
) |
|
|
— |
|
|
|
(37,891 |
) |
|
|
— |
|
Total operating income adjustments |
|
|
(24,381 |
) |
|
|
15,007 |
|
|
|
5,757 |
|
|
|
41,647 |
|
Depreciation expense |
|
|
11,847 |
|
|
|
10,586 |
|
|
|
34,443 |
|
|
|
31,971 |
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA |
|
$ |
118,094 |
|
|
$ |
101,322 |
|
|
$ |
328,555 |
|
|
$ |
270,773 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP income from continuing operations margin |
|
|
15.5 |
% |
|
|
7.3 |
% |
|
|
10.6 |
% |
|
|
7.0 |
% |
Adjusted EBITDA margin |
|
|
17.6 |
% |
|
|
16.7 |
% |
|
|
16.9 |
% |
|
|
16.0 |
% |
GAAP income from continuing operations |
|
$ |
103,687 |
|
|
$ |
43,964 |
|
|
$ |
206,425 |
|
|
$ |
118,375 |
|
Less: Net income attributable to noncontrolling interest |
|
|
27 |
|
|
|
53 |
|
|
|
111 |
|
|
|
336 |
|
GAAP net income from continuing operations attributable to Belden stockholders |
|
$ |
103,660 |
|
|
$ |
43,911 |
|
|
$ |
206,314 |
|
|
$ |
118,039 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP income from continuing operations |
|
$ |
103,687 |
|
|
$ |
43,964 |
|
|
$ |
206,425 |
|
|
$ |
118,375 |
|
Plus: Operating income adjustments from above |
|
|
(24,381 |
) |
|
|
15,007 |
|
|
|
5,757 |
|
|
|
41,647 |
|
Plus: Non-operating pension settlement loss |
|
|
954 |
|
|
|
— |
|
|
|
954 |
|
|
|
— |
|
Plus: Loss on debt extinguishment |
|
|
— |
|
|
|
5,715 |
|
|
|
6,392 |
|
|
|
5,715 |
|
Less: Net income attributable to noncontrolling interest |
|
|
27 |
|
|
|
53 |
|
|
|
111 |
|
|
|
336 |
|
Less: Tax effect of adjustments above |
|
|
2,121 |
|
|
|
4,042 |
|
|
|
10,360 |
|
|
|
9,360 |
|
Adjusted net income from continuing operations attributable to Belden stockholders |
|
$ |
78,112 |
|
|
$ |
60,591 |
|
|
$ |
209,057 |
|
|
$ |
156,041 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP income from continuing operations per diluted share attributable to Belden stockholders |
|
$ |
2.35 |
|
|
$ |
0.97 |
|
|
$ |
4.60 |
|
|
$ |
2.61 |
|
Adjusted income from continuing operations per diluted share attributable to Belden stockholders |
|
$ |
1.77 |
|
|
$ |
1.33 |
|
|
$ |
4.67 |
|
|
$ |
3.45 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP and adjusted diluted weighted average shares |
|
|
44,063 |
|
|
|
45,425 |
|
|
|
44,810 |
|
|
|
45,242 |
|
BELDEN INC.
RECONCILIATION OF NON-GAAP MEASURES
(Unaudited)
We define free cash flow, which is a non-GAAP financial measure, as net cash from operating activities adjusted for capital expenditures net of the proceeds from the disposal of 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 |
|
Nine Months Ended |
||||||||||||
|
|
October 2, 2022 |
|
October 3, 2021 |
|
October 2, 2022 |
|
October 3, 2021 |
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
(In thousands) |
||||||||||||||
GAAP net cash provided by operating activities |
|
$ |
87,381 |
|
|
$ |
74,982 |
|
|
$ |
78,800 |
|
|
$ |
101,919 |
|
Capital expenditures |
|
|
(19,240 |
) |
|
|
(24,703 |
) |
|
|
(50,250 |
) |
|
|
(55,569 |
) |
Proceeds from disposal of assets |
|
|
42,110 |
|
|
|
— |
|
|
|
43,534 |
|
|
|
3,249 |
|
Non-GAAP free cash flow |
|
$ |
110,251 |
|
|
$ |
50,279 |
|
|
$ |
72,084 |
|
|
$ |
49,599 |
|
BELDEN INC. RECONCILIATION OF NON-GAAP MEASURES 2022 Guidance |
||||
|
|
Year Ended |
|
Three Months Ended |
|
|
December 31, 2022 |
|
December 31, 2022 |
|
|
|
|
|
|
|
(In thousands) |
||
GAAP income from continuing operations per diluted share attributable to Belden common stockholders |
|
$5.89 - $5.99 |
|
$1.27 - $1.37 |
Amortization of intangible assets |
|
0.71 |
|
0.19 |
Severance, restructuring, and acquisition integration costs |
|
0.37 |
|
0.11 |
Loss from debt extinguishment |
|
0.11 |
|
— |
Gain on sale of asset |
|
(0.81) |
|
— |
Adjustments related to acquisitions and divestitures |
|
— |
|
0.03 |
Adjusted income from continuing operations per diluted share attributable to Belden common stockholders |
|
$6.27 - $6.37 |
|
$1.60 - $1.70 |
Our guidance is based upon information currently available regarding events and conditions that will impact our future operating results. In particular, our results are subject to the factors listed under "Forward-Looking Statements" in this release. In addition, our actual results are likely to be impacted by other additional events for which information is not available, such as asset impairments, adjustments related to acquisitions and divestitures, severance, restructuring, and acquisition integration costs, gains (losses) recognized on the disposal of assets, gains (losses) on debt extinguishment, discontinued operations, and other gains (losses) related to events or conditions that are not yet known. Such information is not available for our 2025 fiscal year, and therefore we are unable to estimate 2025 GAAP income from continuing operations per diluted share attributable to Belden common stockholders.
Forward-Looking Statements
This release and any statements made by us concerning the subject matter of this release may contain forward-looking statements, including our expectations for the fourth quarter and full-year 2022. Forward-looking statements also include any statements regarding future financial performance (including revenues, expenses, earnings, margins, cash flows, dividends, capital expenditures and financial condition), plans and objectives, and related assumptions. In some cases these statements are identifiable through the use of words such as “anticipate,” “believe,” “estimate,” “forecast,” “guide,” “expect,” “intend,” “plan,” “project,” “target,” “can,” “could,” “may,” “should,” “will,” “would” and similar expressions. Forward-looking statements reflect management’s current beliefs and expectations and are not guarantees of future performance. Actual results may differ materially from those suggested by any forward-looking statements for a number of reasons, including, without limitation: the impact of disruptions in the global supply chain, including the inability to obtain raw materials and components in sufficient quantities on commercially reasonable terms; the lack of certainty as to the duration and magnitude of the impact of COVID-19 and the economic recovery from that impact; foreign and domestic political, economic and other uncertainties, including changes in currency exchange rates; the impact of a challenging global economy or a downturn in served markets; the inability to successfully complete and integrate acquisitions in furtherance of the Company’s strategic plan; difficulty in forecasting revenue due to the unpredictable timing of orders related to customer projects as well as the impacts of channel inventory; inflation and changes in the price and availability of raw materials leading to higher input and labor costs; the inability to execute and realize the expected benefits from strategic initiatives (including revenue growth, cost control, and productivity improvement programs); the inability to retain key employees; the increased influence of chief information officers on purchasing decisions; disruptions in the Company’s information systems including due to cyber-attacks leading to exposures of personally identifiable information; changes in tax laws and variability in the Company’s quarterly and annual effective tax rates; the competitiveness of the global markets in which we operate; the presence of substitute products in the marketplace; the increased prevalence of cloud computing; the inability of the Company to develop and introduce new products and competitive responses to our products; the inability to achieve our strategic priorities in emerging markets; the impact of changes in global tariffs and trade agreements; volatility in credit and foreign exchange markets; the presence of activists proposing certain actions by the Company; perceived or actual product failures; risks related to the use of open source software; disruption of, or changes in, the Company’s key distribution channels; assertions that the Company violates the intellectual property of others and the ownership of intellectual property by competitors and others that prevents the use of that intellectual property by the Company; the impact of regulatory requirements and other legal compliance issues; the impairment of goodwill and other intangible assets and the resulting impact on financial performance; disruptions and increased costs attendant to collective bargaining groups and other labor matters; and other factors.
For a more complete discussion of risk factors, please see our Annual Report on Form 10-K for the period ended December 31, 2021, filed with the SEC on February 15, 2022. Although the content of this release represents our best judgment as of the date of this report based on information currently available and reasonable assumptions, we give no assurances that the expectations will prove to be accurate. Deviations from the expectations may be material. For these reasons, Belden cautions readers to not place undue reliance on these forward-looking statements, which speak only as of the date made. Belden disclaims any duty to update any forward-looking statements as a result of new information, future developments, or otherwise, except as required by law.
About Belden
Belden Inc. delivers the infrastructure that makes the digital journey simpler, smarter and secure. We’re moving beyond connectivity, from what we make to what we make possible through a performance-driven portfolio, forward-thinking expertise and purpose-built solutions. With a legacy of quality and reliability spanning 120-plus years, we have a strong foundation to continue building the future. We are headquartered in St. Louis and have manufacturing capabilities in North America, Europe, Asia, and Africa. For more information, visit us at www.belden.com; follow us on Facebook, LinkedIn and Twitter.
View source version on businesswire.com: https://www.businesswire.com/news/home/20221102005225/en/
Contacts
Belden Investor Relations
314-854-8054
Investor.Relations@Belden.com
