Littelfuse, Inc. : Littelfuse Reports Fourth Quarter and Full Year Results
02/07/2012 | 06:35am
Littelfuse,
Inc. (NASDAQ:LFUS) today reported sales and earnings for the fourth
quarter and full year of 2011.
Fourth Quarter Highlights
Sales were $147.2 million for the fourth quarter of 2011, a 3%
increase compared to the fourth quarter of 2010. Excluding the Cole
Hersee and Selco acquisitions, sales declined 6% year over year due
primarily to inventory de-stocking in the electronics supply chain.
On a GAAP basis, diluted earnings per share for the fourth quarter of
2011 were $0.70 compared to $0.88 in the fourth quarter of 2010.
Adjusted (non-GAAP) earnings for the fourth quarter were $0.67 per
share (see Supplemental Schedule on page 8). The adjustments to GAAP
earnings were to remove a $1.7 million tax benefit and a $0.7 million
pre-tax purchase accounting charge related to the Selco acquisition.
Sales and order trends by business unit were as follows:
Automotive sales increased 37% year over year. Cole Hersee
contributed $10.9 million for the quarter. Excluding Cole Hersee,
automotive sales increased 4% driven by growth in the U.S. and
Asia.
Electrical sales increased 27% year over year due to double digit
organic growth across all product lines and the addition of $2.2
million of Selco sales.
Electronics sales declined 16% year over year and 25% sequentially
due to channel inventory de-stocking in addition to slowing end
demand.
The electronics book-to-bill ratio for the fourth quarter was 0.96
and is running significantly above 1.0 so far for the first
quarter of 2012.
Cash provided by operating activities was $36.8 million for the fourth
quarter of 2011, while capital expenditures were $5.2 million.
Full Year Highlights
Sales were $665.0 million for 2011, a 9% increase compared to sales of
$608.0 million for 2010. Excluding the acquisitions of Cole Hersee and
Selco, sales increased by 1% year over year, as strong organic growth
in electrical (15%) and automotive (8%) was mostly offset by a 5%
decline in electronics. Electrical growth in 2011 was driven primarily
by protection relays and custom products which grew 69% and 29%
respectively. All regions contributed to the growth in automotive.
While electronics sales grew in the first half of 2011, sales in the
second half were impacted by the channel inventory correction.
On a GAAP basis, diluted earnings per share for 2011 increased 11% to
$3.90 compared to $3.52 in 2010.
Cash provided by operating activities was $120.8 million for 2011
compared to $104.1 million in 2010.
Capital expenditures were $17.6 million in 2011 compared to $22.4
million in 2010.
"The fourth quarter came in consistent with our guidance with weak
electronics sales, solid automotive performance and continued strong
growth in electrical," said Gordon Hunter, Chief Executive Officer.
"Notwithstanding the slow finish to the year, we were encouraged by our
performance in 2011 and proud of achieving a second consecutive year of
record sales, earnings and cash flow. We made good progress on our
growth initiatives, executed well operationally and the integrations of
Cole Hersee and Selco are on track."
Outlook
Sales for the first quarter of 2012 are expected to be in the range of
$148 to $158 million.
Earnings for the first quarter of 2012 are expected to be in the range
of $0.68 to $0.78 per diluted share.
Capital expenditures are expected to increase to approximately $35
million in 2012 primarily due to building expansions in support of
growth initiatives at the company's manufacturing sites in Canada, the
Philippines and Mexico.
"Although the first quarter of 2012 started slowly due to the lingering
effects of the electronics inventory correction and an early Chinese New
Year, we expect sales to improve in the latter part of the first quarter
and throughout the second quarter," said Hunter. "With our growth
initiatives and acquisition integrations progressing well, we are
cautiously optimistic about the second half of the year."
Dividend
The company will pay a cash dividend of $0.18 per common share on March
5, 2012 to shareholders of record at the close of business on February
20, 2012.
Conference Call Webcast Information
Littelfuse will host a conference call today, Tuesday, February 7, 2012
at 11:00 a.m. Eastern/10:00 a.m. Central time to discuss the fourth
quarter results. The call will be broadcast live over the Internet and
can be accessed through the company's Web site: www.littelfuse.com.
Listeners should go to the Web site at least 15 minutes prior to the
call to download and install any necessary audio software. The call will
be available for replay through March 31, 2012 and can be accessed
through the Web site listed above.
About Littelfuse
Littelfuse, Inc. is the worldwide leader in circuit protection with 2011
revenues of $665 million. Founded in 1927, Littelfuse offers the
industry's broadest and deepest portfolio of circuit protection products
and solutions. Backed by industry-leading technical support, design and
manufacturing expertise, Littelfuse devices protect products in
virtually every market that uses electrical energy, from consumer
electronics to automobiles to industrial equipment. In addition to its
Chicago, Illinois, world headquarters, Littelfuse has more than 20
sales, distribution, manufacturing and engineering facilities in the
Americas, Europe and Asia. Technologies offered by Littelfuse include Fuses;
Gas Discharge Tubes (GDTs); Positive
Temperature Coefficient Devices (PTCs); Protection
Relays; PulseGuard®
ESD Suppressors; SIDACtor®
Devices; TVS
Diode Arrays (SPA? Family of Products); Switching
Thyristors; TVS
Diodes and Varistors.
The company also offers a comprehensive line of highly reliable Electromechanical
and Electronic Switch and Control Devices for commercial and
specialty vehicles, as well as underground Power
Distribution Centers for safe control and distribution of
electricity in mining operations.
For more information, please visit Littelfuse's Web site at www.littelfuse.com.
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995.
The statements in this press release that are not historical facts are
intended to constitute "forward-looking statements" entitled to the
safe-harbor provisions of the PSLRA. These statements may involve risks
and uncertainties, including, but not limited to, risks relating to
product demand and market acceptance, economic conditions, the impact of
competitive products and pricing, product quality problems or product
recalls, capacity and supply difficulties or constraints, coal mining
exposures reserves, failure of an indemnification for environmental
liability, exchange rate fluctuations, commodity price fluctuations, the
effect of the company's accounting policies, labor disputes,
restructuring costs in excess of expectations, pension plan asset
returns less than assumed, integration of acquisitions and other risks
which may be detailed in the company's other Securities and Exchange
Commission filings. Should one or more of these risks or uncertainties
materialize or should the underlying assumptions prove incorrect, actual
results and outcomes may differ materially from those indicated or
implied in the forward-looking statements. This report should be read in
conjunction with information provided in the financial statements
appearing in the company's Annual Report on Form 10-K for the year ended
January 1, 2011. For a further discussion of the risk factors of the
company, please see Item 1A. "Risk Factors" to the company's
Annual Report on Form 10-K for the year ended January 1, 2011.
LITTELFUSE, INC.
Net Sales by Business Unit and Geography
(In millions of USD, unaudited)
Fourth Quarter
Year-to-Date
2011
2010(a)
% Change
2011
2010(a)
% Change
Business Unit
Electronics
$
72.5
$
86.3
(16
%)
$
354.5
$
373.4
(5
%)
Automotive
45.6
33.4
37
%
197.6
139.1
42
%
Electrical
29.1
22.9
27
%
112.9
95.5
18
%
Total
$
147.2
$
142.6
3
%
$
665.0
$
608.0
9
%
Fourth Quarter
Year-to-Date
2011
2010(a)
% Change
2011
2010(a)
% Change
Geography
Americas
$
66.4
$
54.8
21
%
$
288.6
$
227.7
27
%
Europe
24.0
26.9
(11
%)
114.9
115.1
0
%
Asia-Pacific
56.8
60.9
(7
%)
261.5
265.2
(1
%)
Total
$
147.2
$
142.6
3
%
$
665.0
$
608.0
9
%
(a)In the first quarter of 2011, as previously
disclosed, the company adjusted its business segment reporting
methodology to roll-up segment financials by product line rather
than by sales organization. This change more closely aligns
segment reporting with how the company manages its businesses. The
company's consolidated revenues and operating income were not
affected by this change. The 2010 information was adjusted to
conform to this new presentation method.
LITTELFUSE, INC.
Condensed Consolidated Balance Sheets
(In thousands of USD, except share amounts)
December 31, 2011
January 1, 2011
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
164,016
$
109,720
Short-term investments
13,997
-
Accounts receivable, less allowances
92,088
97,753
Inventories
75,575
80,182
Deferred income taxes
11,895
10,588
Prepaid expenses and other current assets
14,219
13,882
Assets held for sale
6,592
6,831
Total current assets
378,382
318,956
Property, plant and equipment:
Land
4,888
5,688
Buildings
52,730
53,089
Equipment
281,521
276,371
339,139
335,148
Accumulated depreciation
(220,255
)
(205,001
)
Net property, plant and equipment
118,884
130,147
Intangible assets, net of amortization:
Patents, licenses and software
10,753
11,211
Distribution network
19,307
9,752
Customer lists, trademarks and tradenames
14,523
20,865
Goodwill
115,697
112,687
160,280
154,515
Investments
14,867
11,660
Deferred income taxes
4,191
3,271
Other assets
1,820
2,580
Total Assets
$
678,424
$
621,129
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
$
19,934
$
24,079
Accrued payroll
23,048
24,186
Accrued expenses
8,861
10,307
Accrued severance
1,843
3,279
Accrued income taxes
10,591
14,997
Current portion of long-term debt
85,000
33,000
Total current liabilities
149,277
109,848
Long-term debt, less current portion
-
41,000
Accrued severance
-
486
Accrued post-retirement benefits
15,292
5,564
Other long-term liabilities
12,752
11,571
Total equity
501,103
452,660
Total liabilities and equity
$
678,424
$
621,129
Common shares issued and outstanding of
21,552,529 and 21,752,536, at December 31, 2011,
and January 1, 2011, respectively.
LITTELFUSE, INC.
Consolidated Statements of Income
(In thousands of USD, except per share data, unaudited)
For the Three Months Ended
For the Twelve Months Ended
December 31, 2011
January 1, 2011
December 31, 2011
January 1, 2011
Net sales
$
147,193
$
142,646
$
664,955
$
608,021
Cost of sales
93,667
88,690
408,261
374,149
Gross profit
53,526
53,956
256,694
233,872
Selling, general and administrative expenses
28,889
23,463
116,740
103,671
Research and development expenses
4,685
4,904
19,439
17,602
Amortization of intangibles
1,831
1,273
6,611
5,025
35,405
29,640
142,790
126,298
Operating income
18,121
24,316
113,904
107,574
Interest expense
420
341
1,691
1,437
Other (income) expense, net
(954
)
(214
)
(2,888
)
(1,542
)
Income before income taxes
18,655
24,189
115,101
107,679
Income taxes
3,417
4,611
28,077
29,016
Net income
$
15,238
$
19,578
$
87,024
$
78,663
Income per share:
Basic
$
0.71
$
0.89
$
3.96
$
3.58
Diluted
$
0.70
$
0.88
$
3.90
$
3.52
Weighted average shares and equivalent shares outstanding:
Basic
21,536
21,664
21,901
21,875
Diluted
21,806
22,094
22,255
22,214
Diluted Income Per Share
Net income as reported
$
15,238
$
19,578
$
87,024
$
78,663
Less: income allocated to participating securities
(42
)
(219
)
(304
)
(408
)
Net income available to common shareholders
$
15,196
$
19,359
$
86,720
$
78,255
Weighted average shares adjusted for dilutive securities
21,806
22,094
22,255
22,214
Diluted income per share
$
0.70
$
0.88
$
3.90
$
3.52
LITTELFUSE, INC.
Consolidated Statements of Cash Flows
(In thousands of USD, unaudited)
For the Twelve Months Ended
December 31, 2011
January 1, 2011
OPERATING ACTIVITIES:
Net income
$
87,024
$
78,663
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation
25,641
26,980
Impairment of assets
2,320
2,988
Amortization of intangibles
6,611
5,025
Provision for bad debts
444
353
Non-cash inventory charge(a)
4,145
-
Loss (gain) on sale of assets
183
(615
)
Stock-based compensation
5,805
5,243
Excess tax benefit on stock-based compensation
(4,220
)
(1,617
)
Deferred income taxes
(1,363
)
7,784
Changes in operating assets and liabilities:
Accounts receivable
4,768
(12,804
)
Inventories
2,612
(15,147
)
Accounts payable
(5,272
)
(1,800
)
Accrued expenses (including post retirement)
(421
)
(13,645
)
Accrued payroll and severance
(3,226
)
2,384
Accrued taxes
(6,057
)
14,878
Prepaid expenses and other
1,756
5,399
Net cash provided by operating activities
120,750
104,069
INVESTING ACTIVITIES:
Purchases of property, plant and equipment
(17,555
)
(22,433
)
Acquisitions of businesses, net of cash acquired
(11,077
)
(48,292
)
Purchases of short-term investments
(14,228
)
-
Purchases of other investment
(6,000
)
-
Proceeds from sale of assets
217
4,997
Net cash used in investing activities
(48,643
)
(65,728
)
FINANCING ACTIVITIES:
Proceeds from debt
110,000
39,345
Payments of term debt
(49,000
)
(8,000
)
Payments of revolving credit facility
(50,000
)
(20,624
)
Debt issuance costs
(716
)
-
Proceeds from exercise of stock options
23,036
18,496
Cash dividends paid
(14,508
)
(3,248
)
Excess tax benefit on stock-based compensation
4,220
1,617
Purchases of common stock
(37,092
)
(25,377
)
Net cash (used in) provide by financing activities
(14,060
)
2,209
Effect of exchange rate changes on cash and cash equivalents
(3,751
)
(1,184
)
Increase in cash and cash equivalents
54,296
39,366
Cash and cash equivalents at beginning of period
109,720
70,354
Cash and cash equivalents at end of period
$
164,016
$
109,720
(a) Purchase accounting adjustment related to
acquisitions.
LITTELFUSE, INC.
Supplemental Information
(In thousands of USD, except per share data, unaudited)
For the Three Months Ended
December 31, 2011
U.S. GAAP
Special Items
Adjusted
Net sales
$
147,193
$
-
$
147,193
Cost of sales
93,667
(468
)
(1)
93,199
Gross profit
53,526
468
53,994
% of sales
36.4
%
36.7
%
Total operating expenses
35,405
(276
)
(1)
35,129
% of sales
24.1
%
23.9
%
Operating income
18,121
744
18,865
% of sales
12.3
%
12.8
%
Interest/other expense (income), net
(534
)
-
(534
)
Income before income taxes
18,655
744
19,399
Income tax expense
3,417
1,341
(2)
4,758
Effective tax rate
18.3
%
24.5
%
Net income as reported
15,238
(597
)
14,641
Less: Income allocated to participating securities
(42
)
2
(40
)
Net Income available to common shareholders
$
15,196
$
(595
)
$
14,601
Net income per diluted share:
$
0.70
$
0.67
Weighted average shares adjusted for dilutive securities:
21,806
21,806
Note: The Company believes that adjusted operating income is more
indicative of its ongoing operating performance than U.S. GAAP
operating income since the former excludes special items as
described below.
Special Items:
(1) Purchase accounting adjustments related to the Selco
A/S acquisition.
(2) Tax adjustments:
i) Write-up of deferred tax assets due to increase in Wuxi, China
statutory rate
$
1,700
ii) Tax effect of purchase accounting charges in (1) above
182
iii) Prior year tax adjustment
(541
)
$
1,341
Littelfuse, Inc. Phil Franklin, (773) 628-0810 Vice
President, Operations Support, CFO and Treasurer
