Amphenol Corporation (NYSE:APH) reported today second quarter
2015 diluted earnings per share excluding one-time items of $0.58
compared to $0.54 for the comparable 2014 period. (All per share
and share amounts included herein have been adjusted to reflect the
Company’s 2-for-1 stock split effective October 9, 2014.) On an as
reported basis, diluted earnings per share for the second quarter
of 2015 was $0.56. Such per share amount for the 2015 quarter
includes a charge for acquisition-related transaction costs of $6
million ($0.02 per share). Sales for the second quarter of 2015
were $1.351 billion compared to $1.314 billion for the 2014 period.
Currency translation had the effect of decreasing sales by
approximately $51 million in the second quarter of 2015 compared to
the 2014 period.
For the six months ended June 30, 2015, diluted earnings per
share excluding one-time items was $1.15, compared to $1.04 for the
comparable 2014 period. On an as reported basis diluted earnings
per share for the six months ended June 30, 2015 was $1.13,
compared to $1.03 for the comparable 2014 period. The 2015 period
includes the one-time charge for acquisition-related transaction
costs described above. The 2014 period includes a one-time charge
of $2 million ($.01 per share) related to the amortization of the
value associated with acquired backlog relating to an acquisition
completed by the Company in the fourth quarter of 2013. Sales for
the six months ended June 30, 2015 were $2.679 billion compared to
$2.560 billion for the 2014 period. Currency translation had the
effect of decreasing sales by approximately $101 million for the
first six months of 2015 compared to the 2014 period.
The Company’s Board of Directors has approved an increase in the
quarterly dividend from $.125 to $.14 per share to be paid on or
about October 2, 2015 to holders of record of the Company’s Class A
Common stock as of September 9, 2015.
Amphenol President and Chief Executive Officer, R. Adam Norwitt,
stated, “For the second quarter 2015, we are pleased to report
sales of $1.351 billion, up 3% in US dollars and 7% in local
currencies, a strong performance. Our sales growth was driven by
increases in the automotive, mobile device, industrial, information
technology and data communications and military markets. This
growth was driven both organically and through the Company’s
successful acquisition program, and was partially offset by the
negative impact of translation from the stronger dollar. EPS
excluding one-time items was $0.58 and grew 7% over the comparable
2014 quarter. The Company’s unique entrepreneurial culture
continues to drive strong operating leverage in the business,
resulting in a 20 basis point year-over-year increase in operating
margins (excluding one-time items) to 19.7% in the second quarter
2015. This excellent performance is a direct result of our dynamic
management team’s ability to drive margin expansion through
outstanding operational execution and an unrelenting focus on all
elements of cost. I am very proud of our organization as we
continue to execute well.”
“The Company continues to expand its growth opportunities
through an ongoing strategy of market and geographic
diversification, a deep commitment to developing enabling
technologies for customers in all markets, as well as an active
acquisition program. As part of that program, in late June, the
Company acquired both ProCom A/S (ProCom) and DoCharm Plastics
Company Ltd (DoCharm). ProCom is a European supplier of antennas,
primarily for the industrial market, with annual sales of
approximately $20 million. DoCharm is a China-based manufacturer of
highly engineered interconnect assemblies for the automotive
market, with annual sales of approximately $50 million. These
acquisitions strengthen the Company’s global capabilities and
product offering in these important markets. In addition,
subsequent to our recent announcement that we had entered into
exclusive negotiations and had made a binding offer to acquire 100%
of the shares of FCI Asia Pte Ltd (FCI) for $1.275 billion (subject
to a closing adjustment), we have now entered into a definitive
acquisition agreement to purchase FCI. Completion of the
transaction remains subject to certain regulatory consents and
approvals and we continue to expect the transaction to close by the
end of 2015.”
“In addition to the Company’s successful acquisition program,
the Company continues to deploy its financial strength in a variety
of ways to increase shareholder value. This includes the purchase,
during the quarter, of 1.4 million shares of the Company’s stock
pursuant to our stock repurchase plan as well as a 12% increase in
the quarterly dividend from $.125 to $.14 per share beginning in
October 2015.”
“There is an increasing level of uncertainty in the global
marketplace. Considering these dynamics, and based on current
currency exchange rates, we expect third quarter 2015 sales in the
range of $1.435 billion to $1.475 billion and diluted EPS
(excluding one-time items) in the range of $0.64 to $0.66. For the
full year 2015, we now expect to achieve sales in the range of
$5.540 billion to $5.620 billion, an increase over 2014 in US
dollars of 4% to 5%, in local currencies of 7% to 9% and
organically (excluding the impact of currency translation and
acquisitions) of 3% to 4%. We expect diluted EPS of $2.43 to $2.47
for the full year 2015, an increase of 8% to 10% over 2014
(excluding one-time items). Notwithstanding the many challenges in
the global economy, we believe we can perform well in the dynamic
electronics marketplace due to our leading technology, increasing
positions with our customers in diverse markets, worldwide
presence, lean cost structure, and agile, experienced and
entrepreneurial management team.”
“The electronics revolution continues to accelerate, with new
applications and higher performance requirements driving increased
demand for our high technology products across all of our end
markets. This creates a significant, long-term growth opportunity
for Amphenol. Our ongoing actions to enhance our competitive
advantages and build sustained financial strength, as well as our
initiatives to broaden and diversify our high technology product
offering both organically and through our successful acquisition
program, have created a solid base for future performance. I am
confident in the ability of our outstanding management team to
dynamically adjust to the constantly changing market environment,
to continue to generate strong profitability and to further
capitalize on the many opportunities to expand our market
position.”
The Company will host a conference call to discuss its second
quarter results at 1:00 PM (EDT) Wednesday, July 22, 2015. The toll
free dial-in number to participate in this call is 888-395-9624;
International dial-in number is 517-623-4547; Passcode: LAMPO.
There will be a replay available until 10:59 P.M. (EDT) on
Saturday, August 22, 2015. The replay numbers are toll free
866-479-2464; International toll number is 203-369-1538; Passcode:
7183.
A live broadcast as well as a replay will also be available on
the Internet at http://www.amphenol.com/investors/webcasts.php.
Amphenol Corporation is one of the world’s largest designers,
manufacturers and marketers of electrical, electronic and fiber
optic connectors, interconnect systems, antennas, sensors and
sensor-based products and coaxial and high-speed specialty cable.
Amphenol designs, manufactures and assembles its products at
facilities in the Americas, Europe, Asia, Australia and Africa and
sells its products through its own global sales force, independent
representatives and a global network of electronics distributors.
Amphenol has a diversified presence as a leader in high growth
areas of the interconnect market including: Automotive, Broadband
Communications, Commercial Aerospace, Industrial, Information
Technology and Data Communications, Military, Mobile Devices and
Mobile Networks.
Statements in this press release which are other than historical
facts are intended to be “forward-looking statements” within the
meaning of the Securities Exchange Act of 1934, the Private
Securities Litigation Reform Act of 1995 and other related laws.
While the Company believes such statements are reasonable, the
actual results and effects could differ materially from those
currently anticipated. Please refer to Part I, Item 1A of the
Company’s Form 10-K for the year ended December 31, 2014, for some
factors that could cause the actual results to differ from
estimates. In providing forward-looking statements, the Company is
not undertaking any duty or obligation to update these statements
publicly as a result of new information, future events or
otherwise.
AMPHENOL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF
INCOME (Unaudited) (dollars in millions, except per
share data) Three Months Ended Six Months
Ended June 30, June 30, 2015
2014 (1)
2015
2014 (1)
Net sales $ 1,351.5 $ 1,314.2 $ 2,678.6 $ 2,560.2
Cost of sales 919.0 897.4
1,821.6 1,754.6 Gross profit 432.5
416.8 857.0 805.6 Acquisition-related expenses 5.7 - 5.7 2.0
Selling, general and administrative expense 166.1
161.0 330.4 315.7
Operating income 260.7 255.8 520.9 487.9 Interest
expense (17.1 ) (20.1 ) (34.1 ) (39.2 ) Other income, net
4.2 4.3 8.3 8.4
Income before income taxes 247.8 240.0 495.1 457.1
Provision for income taxes (67.2 ) (63.6 )
(132.7 ) (120.9 ) Net income 180.6 176.4 362.4 336.2
Less: Net income attributable to noncontrolling interests
(1.6 ) (1.5 ) (3.6 ) (2.8 ) Net income
attributable to Amphenol Corporation $ 179.0 $ 174.9
$ 358.8 $ 333.4 Net income per common
share - Basic $ 0.58 $ 0.56 $ 1.16 $ 1.06
Weighted average common shares outstanding - Basic
308,899,937 314,229,370
309,470,068 314,640,882
Net income per common share - Diluted
(2) (3)
$ 0.56 $ 0.54 $ 1.13 $ 1.03
Weighted average common shares outstanding - Diluted
316,878,100 321,582,270 317,428,813
321,966,158 Dividends declared per
common share $ 0.125 $ 0.10 $ 0.25 $ 0.20
Note 1 Prior period results have
been restated to reflect a two-for-one stock split which was
effective in October 2014.
Note 2 Earnings per share
in the six months ended June 30, 2014 included acquisition-related
expenses of $2.0 million ($1.3 million after-tax), or $.01 per
share, relating to the amortization of the value associated with
acquired backlog relating to an acquisition completed by the
Company in the fourth quarter of 2013. Excluding this effect,
diluted earnings per share was $1.04 for the six months ended June
30, 2014.
Note 3 Earnings per share in the three and
six months ended June 30, 2015 included acquisition-related
expenses of $5.7 million ($5.7 million after-tax), or $.02 per
share, relating to acquisitions closed as well as announced in the
second quarter of 2015. Excluding this effect, diluted earnings per
share was $0.58 and $1.15 for the three and six months ended June
30, 2015, respectively.
AMPHENOL CORPORATION CONDENSED CONSOLIDATED BALANCE
SHEETS (Unaudited) (dollars in millions)
June 30, December 31, 2015
2014
ASSETS Current Assets: Cash
and cash equivalents $ 1,242.8 $ 968.9 Short-term investments
154.4 360.7 Total cash, cash
equivalents and short-term investments 1,397.2 1,329.6 Accounts
receivable, less allowance for doubtful accounts of $21.1 and
$20.2, respectively 1,089.5 1,123.7 Inventories 893.0 865.6 Other
current assets 213.1 185.2 Total
current assets 3,592.8 3,504.1 Land and depreciable assets,
less accumulated depreciation of $885.0 and $849.6, respectively
609.9 590.7 Goodwill 2,709.0 2,616.7 Intangibles and other
long-term assets 317.0 315.5 $
7,228.7 $ 7,027.0
LIABILITIES &
EQUITY Current Liabilities: Accounts payable $ 559.5 $
618.4 Accrued salaries, wages and employee benefits 106.0 109.9
Accrued income taxes 79.0 90.8 Other accrued expenses 201.2 186.2
Accrued dividends 38.6 38.7 Current portion of long-term debt
0.4 1.6 Total current
liabilities 984.7 1,045.6 Long-term debt, less current
portion 2,759.2 2,672.3 Accrued pension benefit obligations and
other long-term liabilities 382.0 371.2 Equity: Common stock
0.3 0.3 Additional paid-in capital 729.6 659.4 Retained earnings
2,591.3 2,453.5 Accumulated other comprehensive loss (256.1
) (205.8 ) Total shareholders' equity attributable to
Amphenol Corporation 3,065.1 2,907.4 Noncontrolling
interests 37.7 30.5 Total equity
3,102.8 2,937.9 $ 7,228.7
$ 7,027.0
AMPHENOL
CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOW (Unaudited) (dollars in millions)
Six months ended June 30, 2015
2014 Cash from operating activities: Net income $
362.4 $ 336.2 Adjustments to reconcile net income to cash provided
by operating activities: Depreciation and amortization 83.5 77.6
Stock-based compensation expense 20.2 19.2 Excess tax benefits from
stock-based compensation payment arrangements (9.1 ) (18.1 ) Net
change in components of working capital (44.3 ) (41.2 ) Net change
in other long-term assets and liabilities 10.1
9.6 Net cash provided by operating activities
422.8 383.3 Cash from investing
activities: Purchases of land and depreciable assets (85.2 ) (105.9
) Proceeds from disposals of land and depreciable assets 2.3 1.4
Purchases of short-term investments (113.6 ) (356.0 ) Sales and
maturities of short-term investments 319.8 293.4 Acquisitions, net
of cash acquired (171.8 ) (19.5 ) Net cash
used in investing activities (48.5 ) (186.6 )
Cash from financing activities: Proceeds from issuance of senior
notes - 748.8 Long-term borrowings under credit facilities - 398.1
Repayments of long-term debt - (936.6 ) Net commercial paper
borrowings 86.5 - Payment of costs related to debt financing - (5.7
) Proceeds from exercise of stock options 40.2 58.3 Excess tax
benefits from stock-based compensation payment arrangements 9.1
18.1 Distributions to shareholders of noncontrolling interests (4.4
) (1.7 ) Purchase and retirement of treasury stock (143.6 ) (250.2
) Dividend payments (77.5 ) (31.4 ) Net cash
used in financing activities (89.7 ) (2.3 )
Effect of exchange rate changes on cash and cash equivalents (10.7
) (1.1 ) Net change in cash and cash equivalents 273.9 193.3
Cash and cash equivalents balance, beginning of period 968.9
886.8 Cash and cash equivalents
balance, end of period $ 1,242.8 $ 1,080.1
Cash paid for: Interest $ 32.0 $ 29.7 Income taxes 128.7 119.3
AMPHENOL CORPORATION SEGMENT INFORMATION
(Unaudited) (dollars in millions)
Three months ended Six months ended
June 30, June 30,
2015 2014 2015
2014 Net sales: Interconnect Products and Assemblies
$ 1,268.7 $ 1,222.3 $ 2,511.3 $ 2,381.4 Cable Products and
Solutions 82.8 91.9 167.3
178.8 Consolidated $ 1,351.5 $ 1,314.2
$ 2,678.6 $ 2,560.2 Operating income:
Interconnect Products and Assemblies $ 277.9 $ 264.3 $ 548.8 $
507.0 Cable Products and Solutions 9.7 11.7 20.0 22.3 Stock-based
compensation expense (10.1 ) (10.0 ) (20.2 ) (19.2 ) Other
operating expenses (11.1 ) (10.2 ) (22.0 )
(20.2 ) Operating income, excluding one-time items $ 266.4
$ 255.8 $ 526.6 $ 489.9
Acquisition-related expenses (5.7 ) -
(5.7 ) (2.0 ) Consolidated $ 260.7 $ 255.8 $
520.9 $ 487.9 ROS%: Interconnect
Products and Assemblies 21.9 % 21.6 % 21.9 % 21.3 % Cable Products
and Solutions 11.8 % 12.7 % 11.9 % 12.5 % Stock-based compensation
expense -0.7 % -0.8 % -0.8 % -0.8 % Other operating expenses -0.8 %
-0.8 % -0.8 % -0.8 % ROS, excluding one-time items 19.7 %
19.5 % 19.7 % 19.1 % Acquisition-related expenses -0.4 % 0.0
% -0.3 % 0.0 % Consolidated 19.3 % 19.5 % 19.4 % 19.1 %
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version on businesswire.com: http://www.businesswire.com/news/home/20150722005399/en/
Amphenol CorporationCraig A. Lampo, 203-265-8625Senior Vice
President and Chief Financial Officerwww.amphenol.com
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