Bel Fuse Inc. (Nasdaq: BELFA and BELFB) today
announced preliminary financial results for the fourth quarter and
full year of 2019.
Fourth Quarter 2019
Highlights
• |
Net sales of $115.1 million, down 19.3% from Q4-18 |
• |
Gross profit margin of 21.4%, down from 26.8% in Q4-18
(excludes R&D costs) |
• |
Closed on acquisition of CUI Inc.
power assets from CUI Global in December |
• |
Generated cash flow from operating activities of $6.4 million |
Full Year 2019 Highlights
• |
Net sales of $492.4 million, down 10.2% from
2018 |
• |
Gross profit margin of 22.5%, down from 25.4% in 2018
(excludes R&D costs) |
• |
Non-cash goodwill impairment
charge of $8.9 million, as market weakness impacted North America
segment |
• |
Generated cash flow from operating activities of $25.3 million |
Non-GAAP financial measures, such as Non-GAAP
net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA, exclude the
impact of a non-cash goodwill impairment charge, a gain on sale of
property, costs associated with ERP system implementation costs,
restructuring charges and non-cash charges associated with the
liquidation of foreign subsidiaries. Please refer to the financial
information included with this press release for reconciliations of
GAAP financial measures to Non-GAAP financial measures and our
explanation of why we present Non-GAAP financial measures.
CEO CommentsDaniel Bernstein,
President and CEO, said, “International trade policy, and in
particular the additional tariffs imposed on our products imported
from China, negatively impacted our results in 2019.
Following an acceleration of orders throughout 2018 from customers
anticipating higher pricing in 2019, the industry experienced lower
order and sales volumes throughout the supply chain in 2019.
In many cases for Bel, the lower order volume related to customers
and distributors working through their inventory on
hand. However, by year end, the ongoing tariffs
caused certain customers to source products from other
countries and this further impacted our sales during the fourth
quarter. The softer top-line along with higher material costs
throughout most of 2019 contributed to margin erosion that we’re
working hard to restore. Our product development teams continued to
work diligently in introducing 477 new products during 2019, a
13% increase from the prior year.
“On a positive note, we've seen steady increases
in bookings for our Cinch and Magnetic product
groups over the past two quarters which indicates that the
excess inventory in the supply channel has been worked through for
these products. This should bode well for sales growth
as we move into the second half of 2020. There have also been
early signs of progress from our acquisition of the power assets of
CUI Inc. late in 2019, which is expected to contribute over $30
million in annual sales growth to Bel in 2020 at an EBITDA margin
of approximately 10%. We are excited about the broad product
offering and the alternative business model that CUI brings to
Bel. The Company has also made significant progress on
its global cost structure initiative throughout 2019 and we
look forward to seeing a full year’s benefit of the $5.7 million of
annual cost saving actions implemented during 2019. We will
continue to streamline the organization to improve
profitability. Our ERP implementation is steadily
progressing, with an additional 15% of our business going live on
the new system effective January 1, 2020. To date, 40% of our
overall business has transitioned to the new ERP system and we've
achieved annual cost savings on ERP licensing fees of approximately
$2 million which were largely realized in 2019. This project
should conclude by early 2021.
“We enter 2020 with very limited
visibility given the recent Coronavirus outbreak and
separately, the grounding of Boeing's 737-MAX. Bel is closely
monitoring the Coronavirus outbreak and its impact on our
operations and supply channel. We anticipate first quarter
2020 results will be impacted by the extended Lunar New Year
holiday break and by lower productivity levels at our four
manufacturing sites in China, all of which have resumed operations
at reduced levels. Our top priority is the welfare of our
associates, and we are working diligently with the local
governments to ensure necessary preparations are made to allow our
remaining associates to safely return to work. Lead times for
our products are currently pushed back by four weeks, and may
extend further as we better determine the impact on our
suppliers. The continued grounding of Boeing's 737-MAX
will also have an impact on our comparisons throughout 2020.
Production of the aircraft was suspended in January 2020, and while
we anticipate production to resume in the coming months, it will
likely be at a lower rate for a period of time. We expect to
mitigate some of this exposure through prompt adjustments in our
workforce at the related facilities, and through stronger
after-market sales of our products as airlines increase maintenance
spending on existing aircraft in their fleet. Our management
team is responding quickly to the new challenges presented by these
recent events, and will work diligently to minimize the impacts to
our operations and financial results,” concluded Mr. Bernstein.
Financial Summary
All comparative percentages are on a
year-over-year basis, unless otherwise noted.
Fourth Quarter 2019
Results
Net SalesNet sales were $115.1
million, down $27.6 million, or 19.3%, from last year’s fourth
quarter.
|
• |
Geographically: Europe sales were down by 21.2%, North America
sales declined by 16.7% and Asia sales were lower by 22.3%. |
|
• |
By product segment: Connectivity Solutions sales declined by 11.6%,
Magnetic Solutions sales were lower by 21.9% and Power Solutions
and Protection sales were down by 24.3%. |
Gross ProfitGross profit margin
decreased to 21.4%, from 26.8% in the fourth quarter of 2018,
primarily due to lower sales volumes and higher material costs in
the fourth quarter of 2019, partially offset by savings realized
from restructuring initiatives and other cost containment measures
implemented earlier in 2019. Lower labor costs in Asia, due to a
strengthening dollar versus the Renminbi, also provided an offset
to higher material costs.
Research and Development
CostsResearch and development costs were $6.7 million in
the fourth quarter of 2019, down $1.1 million from the same period
of 2018. This decline was largely the result of restructuring
efforts implemented throughout 2019.
Selling, General and Administrative
Expenses (SG&A)SG&A expenses were $19.1 million,
down $3.4 million from the fourth quarter of 2018 largely due
to lower ERP support and maintenance costs, reduced commissions and
the result of other cost containment efforts.
Operating (Loss)
IncomeOperating loss was $(2.2) million, down from
income of $7.7 million in the fourth quarter of 2018, with an
operating margin of -1.9% compared to 5.4% in the fourth quarter of
2018.
Other Income/Expense, NetOther
income/expense, net was expense of $2.5 million for the fourth
quarter of 2019 compared to income of $0.1 million during the
fourth quarter of 2018. The expense in the fourth quarter
2019 largely related to a $2.1 million loss on liquidation of
foreign subsidiaries. Another contributing factor was a
foreign exchange loss of $0.4 million in the fourth quarter of 2019
as compared to a foreign exchange gain of $0.3 million in the
fourth quarter of 2018.
Income TaxesThe provision for
income taxes was $0.4 million in the fourth quarter of 2019,
compared to $2.4 million in the same period of 2018. This
resulted in an effective tax rate of -6.6% during the fourth
quarter of 2019, compared to an effective tax rate of 37.2% during
the same quarter last year. The effective tax rate for the
fourth quarter of 2019 reflects a reduction in GILTI tax and taxes
related to uncertain tax positions as well as permanent tax
differences on US tax exempt activities compared to the same
quarter of 2018.
Net (Loss) EarningsThe above
factors resulted in net loss of $(6.4) million in the fourth
quarter of 2019 as compared with net earnings of $4.0 million in
the fourth quarter of 2018.
Year Ended December 31,
2019 Results
Net SalesNet sales were $492.4
million, down $55.8 million, or 10.2%, from the same period of
2018.
|
• |
Geographically: Europe sales
were down by 8.6%, North America sales declined by 5.8% and Asia
sales were lower by 17.3%. |
|
• |
By product segment: Power
Solutions and Protection sales were down by 7.3%, Connectivity
Solutions sales declined by 7.7% and Magnetic Solutions sales were
lower by 15.4%. |
Gross ProfitGross profit margin decreased to
22.5%, from 25.4% in the same period of 2018, primarily due to
lower sales volumes and higher material costs in 2019, partially
offset by a reduction in labor costs in Asia due to a 4%
appreciation of the U.S. Dollar versus the Renminbi as compared to
the same period of 2018.
Research and Development
CostsResearch and development costs were $26.9 million in
the fourth quarter of 2019, down $2.6 million from 2018. This
decline was largely the result of restructuring efforts implemented
throughout 2019.
Selling, General and Administrative Expenses
(SG&A)SG&A expenses were $76.1 million, down from
$82.6 million in the same period of 2018. Factors contributing to
the lower SG&A expense in 2019 were lower legal and
professional fees of $2.4 million (largely due to lower ERP support
and maintenance costs), a $0.7 million reduction in commissions on
the lower sales base, and the effects of cost containment
measures as compared to 2018.
Operating IncomeOperating
income was $0.5 million, down from $26.9 million in the same period
of 2018, with an operating margin of 0.1% compared to 4.9% in the
same period of 2018.
Other Income/Expense, NetOther
income/expense, net was expense of $2.3 million in 2019
compared to income of $2.0 million in 2018. The expense in
2019 largely related to a $2.1 million loss on liquidation of
foreign subsidiaries. Another factor attributable to the year
over year variance was a foreign exchange gain of $2.7 million in
2018 as compared to a foreign exchange loss of $0.1 million in
2019.
Income TaxesThe provision for
income taxes was $1.4 million in the 2019 period as compared with
$2.9 million during the same period of 2018. This resulted in
an effective tax rate of -19.7% during the 2019 period, compared to
12.3% during the same period last year. The change in the
effective tax rate is primarily attributable to the same factors
noted above related to the fourth quarter. Additionally, the
effective tax rate for the full year of 2018 was favorably impacted
by a measurement period adjustment of $2.6 million related to the
transition tax.
Net (Loss) EarningsThe above
factors, in addition to an $8.9 million goodwill impairment charge
recorded during the third quarter of 2019, resulted in net loss of
$(8.7) million in 2019 as compared with net earnings of $20.7
million in the same period of 2018.
Balance Sheet DataAs of December 31, 2019,
working capital was $193.0 million, including $73.2 million of cash
and cash equivalents with a current ratio of 3.1-to-1. In
comparison, as of December 31, 2018, working capital was $184.5
million, including $53.9 million of cash and cash equivalents with
a current ratio of 2.7-to-1. Total debt at December 31, 2019,
net of deferred financing costs, increased to $143.7 million as
compared to $114.2 million at December 31, 2018, primarily due to
utilization of our revolving credit facility to fund the CUI
acquisition, offset by $3.0 million of debt repayments made
during 2019.
Conference CallBel has
scheduled a conference call at 11:00 a.m. ET today. To
participate in the conference call, investors should dial
800-220-8451, or 323-794-2591 if dialing internationally. The
presentation will additionally be broadcast live over the Internet
and will be available at
https://ir.belfuse.com/events-and-presentations. The webcast will
be available via replay for a period of 20 days at this same
Internet address. For those unable to access the live call, a
telephone replay will be available at 844-512-2921, or 412-317-6671
if dialing internationally, using access code 6869224 after 2:00
p.m. ET, also for 20 days.
About BelBel (www.belfuse.com) designs,
manufactures and markets a broad array of products that power,
protect and connect electronic circuits. These products are
primarily used in the networking, telecommunications, computing,
military, aerospace, transportation and broadcasting
industries. Bel's product groups include Magnetic Solutions
(integrated connector modules, power transformers, power inductors
and discrete components), Power Solutions and Protection
(front-end, board-mount and industrial power products, module
products and circuit protection), and Connectivity Solutions
(expanded beam fiber optic, copper-based, RF and RJ connectors and
cable assemblies). The Company operates facilities around the
world.
Forward-Looking
StatementsNon-historical information contained in this
press release (including the statements regarding potential sales
growth, the anticipated impact of the acquisition of the power
assets of CUI Inc. on Bel’s sales and EBITDA margin, anticipated
cost savings resulting from Bel’s global cost structure initiative,
the timing of completion of Bel’s ERP implementation, the expected
effects of streamlining on Bel’s overall profitability, the
anticipated impact of the Coronavirus outbreak, the extended Lunar
New Year holiday break and the grounding of Boeing’s 737-MAX,
productivity levels at Bel’s four manufacturing sites in China,
Bel’s ability to adjust workload levels at its China sites, and an
increase in airline maintenance on existing aircraft) are
forward-looking statements (as described under the Private
Securities Litigation Reform Act of 1995) that involve risks and
uncertainties. Actual results could differ materially from Bel's
projections. Among the factors that could cause actual results to
differ materially from such statements are: the market concerns
facing our customers; the continuing viability of sectors that rely
on our products; the effects of business and economic conditions;
the success of efforts to contain and otherwise respond to the
Coronavirus; difficulties associated with integrating previously
acquired companies; capacity and supply constraints or
difficulties; product development, commercialization or
technological difficulties; the regulatory and trade environment;
risks associated with foreign currencies; uncertainties associated
with legal proceedings; the market's acceptance of the Company's
new products and competitive responses to those new products; our
ongoing evaluation of the consequences of the U.S. Tax Cuts and
Jobs Act; the impact of changes to U.S. trade and tariff policies;
and the risk factors detailed from time to time in the Company's
SEC reports. In light of the risks and uncertainties impacting our
business, there can be no assurance that any forward-looking
statement will in fact prove to be correct. We undertake no
obligation to update or revise any forward looking
statements.
Non-GAAP Financial MeasuresThe
non-GAAP measures identified in this press release as well as in
the supplementary information to this press release (Non-GAAP net
earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA) are not
measures of performance under accounting principles generally
accepted in the United States of America ("GAAP"). These
measures should not be considered a substitute for, and the reader
should also consider, income from operations, net earnings,
earnings per share and other measures of performance as defined by
GAAP as indicators of our performance or profitability. Our
non-GAAP measures may not be comparable to other similarly-titled
captions of other companies due to differences in the method of
calculation. We present results adjusted to exclude the
effects of certain unusual or special items and their related tax
impact that would otherwise be included under U.S. GAAP, to aid in
comparisons with other periods. We may use Non-GAAP financial
measures to determine performance-based compensation and management
believes that this information may be useful to investors.
Website InformationWe routinely
post important information for investors on our
website, www.belfuse.com, in the "Investor Relations" section.
We use our website as a means of disclosing material, otherwise
non-public information and for complying with our disclosure
obligations under Regulation FD. Accordingly, investors should
monitor the Investor Relations section of our website, in addition
to following our press releases, SEC filings, public conference
calls, presentations and webcasts. The information contained on, or
that may be accessed through, our website is not incorporated by
reference into, and is not a part of, this document.
[Financial tables follow]
Bel Fuse Inc. |
Supplementary Information(1) |
Condensed Consolidated Statements of
Operations |
(in thousands, except per share amounts) |
(unaudited) |
|
|
Three Months Ended |
|
|
Year Ended |
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales |
|
$ |
115,128 |
|
|
$ |
142,734 |
|
|
$ |
492,412 |
|
|
$ |
548,184 |
|
Cost of sales(2) |
|
|
90,532 |
|
|
|
104,460 |
|
|
|
381,715 |
|
|
|
408,927 |
|
Gross
profit |
|
|
24,596 |
|
|
|
38,274 |
|
|
|
110,697 |
|
|
|
139,257 |
|
As a % of net sales |
|
|
21.4 |
% |
|
|
26.8 |
% |
|
|
22.5 |
% |
|
|
25.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
costs(2) |
|
|
6,726 |
|
|
|
7,859 |
|
|
|
26,925 |
|
|
|
29,487 |
|
Selling, general and
administrative expenses(3) |
|
|
19,112 |
|
|
|
22,514 |
|
|
|
76,062 |
|
|
|
82,600 |
|
As a % of net sales |
|
|
16.6 |
% |
|
|
15.8 |
% |
|
|
15.4 |
% |
|
|
15.1 |
% |
Impairment of goodwill |
|
|
- |
|
|
|
- |
|
|
|
8,891 |
|
|
|
- |
|
Restructuring charges |
|
|
942 |
|
|
|
160 |
|
|
|
2,593 |
|
|
|
222 |
|
Gain on sale of property |
|
|
- |
|
|
|
- |
|
|
|
(4,257 |
) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income from
operations |
|
|
(2,184 |
) |
|
|
7,741 |
|
|
|
483 |
|
|
|
26,948 |
|
As a % of net sales |
|
|
-1.9 |
% |
|
|
5.4 |
% |
|
|
0.1 |
% |
|
|
4.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(1,323 |
) |
|
|
(1,399 |
) |
|
|
(5,448 |
) |
|
|
(5,317 |
) |
Other (expense) income,
net(3) |
|
|
(2,454 |
) |
|
|
67 |
|
|
|
(2,337 |
) |
|
|
1,985 |
|
Earnings before
benefit for income taxes |
|
|
(5,961 |
) |
|
|
6,409 |
|
|
|
(7,302 |
) |
|
|
23,616 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes |
|
|
392 |
|
|
|
2,384 |
|
|
|
1,441 |
|
|
|
2,907 |
|
Effective tax rate |
|
|
-6.6 |
% |
|
|
37.2 |
% |
|
|
-19.7 |
% |
|
|
12.3 |
% |
Net (loss)
earnings |
|
$ |
(6,353 |
) |
|
$ |
4,025 |
|
|
$ |
(8,743 |
) |
|
$ |
20,709 |
|
As a % of net sales |
|
|
-5.5 |
% |
|
|
2.8 |
% |
|
|
-1.8 |
% |
|
|
3.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A common shares - basic
and diluted |
|
|
2,145 |
|
|
|
2,175 |
|
|
|
2,167 |
|
|
|
2,175 |
|
Class B common shares - basic
and diluted |
|
|
10,130 |
|
|
|
10,083 |
|
|
|
10,117 |
|
|
|
9,939 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) earnings
per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A common shares - basic
and diluted |
|
$ |
(0.50 |
) |
|
$ |
0.31 |
|
|
$ |
(0.71 |
) |
|
$ |
1.62 |
|
Class B common shares - basic
and diluted |
|
$ |
(0.52 |
) |
|
$ |
0.33 |
|
|
$ |
(0.71 |
) |
|
$ |
1.73 |
|
(1) The
supplementary information included in this press release for 2019
is preliminary and subject to change prior to the filing of our
upcoming Annual Report on Form 10-K with the Securities and
Exchange Commission. |
|
(2) During the
fourth quarter of 2019, the Company changed its financial statement
presentation of research and development costs. These costs
were previously included within cost of sales and were a factor in
arriving at gross profit. During all periods presented above,
research and development costs have been reclassified from cost of
sales to a separate line item below gross profit. This
presentation is consistent with that of our peers. |
|
(3) During the
fourth quarter of 2019, the Company changed its financial statement
presentation related to gain/loss on foreign currency
exchange. These gains/losses were previously included within
selling, general and administrative expense. During all
periods presented above, gains/losses on foreign currency exchange
have been reclassified from selling, general and administrative
expense and are now included within Other income/expense,
net. This presentation is consistent with that of our
peers. |
|
Bel Fuse Inc. |
Supplementary Information(1) |
Condensed Consolidated Balance Sheets |
(in thousands, unaudited) |
|
|
December 31, |
|
|
|
2019 |
|
|
2018 |
|
Assets |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
73,150 |
|
|
$ |
53,911 |
|
Accounts receivable, net |
|
|
75,485 |
|
|
|
91,939 |
|
Inventories |
|
|
107,276 |
|
|
|
120,068 |
|
Other current assets |
|
|
27,524 |
|
|
|
24,591 |
|
Total current assets |
|
|
283,435 |
|
|
|
290,509 |
|
Property, plant and equipment,
net |
|
|
41,943 |
|
|
|
43,932 |
|
Right-of-use assets |
|
|
18,504 |
|
|
|
- |
|
Goodwill and other intangible
assets, net |
|
|
94,357 |
|
|
|
82,506 |
|
Other assets |
|
|
32,435 |
|
|
|
26,577 |
|
Total
assets |
|
$ |
470,674 |
|
|
$ |
443,524 |
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
44,423 |
|
|
$ |
56,171 |
|
Current portion of long-term
debt |
|
|
5,489 |
|
|
|
2,508 |
|
Operating lease liability,
current |
|
|
7,377 |
|
|
|
- |
|
Other current liabilities |
|
|
33,183 |
|
|
|
47,351 |
|
Total current liabilities |
|
|
90,472 |
|
|
|
106,030 |
|
Long-term debt |
|
|
138,215 |
|
|
|
111,705 |
|
Operating lease liability,
long-term |
|
|
11,751 |
|
|
|
- |
|
Other liabilities |
|
|
62,185 |
|
|
|
49,319 |
|
Total liabilities |
|
|
302,623 |
|
|
|
267,054 |
|
Stockholders' equity |
|
|
168,051 |
|
|
|
176,470 |
|
Total liabilities and
stockholders' equity |
|
$ |
470,674 |
|
|
$ |
443,524 |
|
(1) The
supplementary information included in this press release for 2019
is preliminary and subject to change prior to the filing of our
upcoming Annual Report on Form 10-K with the Securities and
Exchange Commission. |
|
Bel Fuse Inc. |
Supplementary Information(1) |
Reconciliation of GAAP Net (Loss) Earnings to EBITDA and
Adjusted EBITDA(2) |
(in thousands, unaudited) |
|
|
Three Months Ended |
|
|
Year Ended |
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net (loss)
earnings |
|
$ |
(6,353 |
) |
|
$ |
4,025 |
|
|
$ |
(8,743 |
) |
|
$ |
20,709 |
|
Interest expense |
|
|
1,323 |
|
|
|
1,399 |
|
|
|
5,448 |
|
|
|
5,317 |
|
Provision for income
taxes |
|
|
392 |
|
|
|
2,384 |
|
|
|
1,441 |
|
|
|
2,907 |
|
Depreciation and
amortization |
|
|
4,206 |
|
|
|
4,469 |
|
|
|
16,471 |
|
|
|
18,207 |
|
EBITDA |
|
$ |
(432 |
) |
|
$ |
12,277 |
|
|
$ |
14,617 |
|
|
$ |
47,140 |
|
% of net sales |
|
|
-0.4 |
% |
|
|
8.6 |
% |
|
|
3.0 |
% |
|
|
8.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unusual or special
items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ERP system implementation consulting costs |
|
|
197 |
|
|
|
737 |
|
|
|
1,814 |
|
|
|
2,226 |
|
Restructuring charges |
|
|
942 |
|
|
|
160 |
|
|
|
2,593 |
|
|
|
222 |
|
Acquisition-related costs |
|
|
232 |
|
|
|
- |
|
|
|
232 |
|
|
|
- |
|
Loss on liquidation of foreign
subsidiary |
|
|
2,103 |
|
|
|
- |
|
|
|
2,103 |
|
|
|
- |
|
Impairment of goodwill |
|
|
- |
|
|
|
- |
|
|
|
8,891 |
|
|
|
- |
|
Gain on sale of property |
|
|
- |
|
|
|
- |
|
|
|
(4,257 |
) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA |
|
$ |
3,042 |
|
|
$ |
13,174 |
|
|
$ |
25,993 |
|
|
$ |
49,588 |
|
% of net sales |
|
|
2.6 |
% |
|
|
9.2 |
% |
|
|
5.3 |
% |
|
|
9.0 |
% |
(1) The
supplementary information included in this press release for 2019
is preliminary and subject to change prior to the filing of our
upcoming Annual Report on Form 10-K with the Securities and
Exchange Commission. |
|
(2) In this press
release and supplemental information, we have included Non-GAAP
financial measures, including Non-GAAP net (loss) earnings,
Non-GAAP EPS, EBITDA and Adjusted EBITDA. We present results
adjusted to exclude the effects of certain specified items and
their related tax impact that would otherwise be included under
GAAP, to aid in comparisons with other periods. We may use Non-GAAP
financial measures to determine performance-based compensation and
management believes that this information may be useful to
investors. |
|
Bel Fuse Inc. |
Supplementary Information(1) |
Reconciliation of GAAP Measures to Non-GAAP
Measures(2) |
(in thousands, unaudited) |
The following
tables detail the impact of certain unusual or special items had on
the Company's net (loss) earnings per common Class A and Class B
basic and diluted shares ("EPS") and the line items these items
were included on the condensed consolidated statements of
operations. |
|
|
Three Months Ended December 31, 2019 |
|
|
Three Months Ended December 31, 2018 |
|
Reconciling Items |
|
Earnings (loss) before taxes |
|
|
Provision for income taxes |
|
|
Net (loss) earnings |
|
|
Class A EPS(3) |
|
|
Class B EPS(3) |
|
|
Earnings before taxes |
|
|
Provision for income taxes |
|
|
Net earnings |
|
|
Class A EPS(3) |
|
|
Class B EPS(3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
measures |
|
$ |
(5,961 |
) |
|
$ |
392 |
|
|
$ |
(6,353 |
) |
|
$ |
(0.50 |
) |
|
$ |
(0.52 |
) |
|
$ |
6,409 |
|
|
$ |
2,384 |
|
|
$ |
4,025 |
|
|
$ |
0.31 |
|
|
$ |
0.33 |
|
Items included in SG&A
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ERP system implementation consulting costs |
|
|
197 |
|
|
|
34 |
|
|
|
163 |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
737 |
|
|
|
139 |
|
|
|
598 |
|
|
|
0.05 |
|
|
|
0.05 |
|
Acquisition-related costs |
|
|
232 |
|
|
|
53 |
|
|
|
179 |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Loss on liquidation of foreign
subsidiary |
|
|
2,103 |
|
|
|
506 |
|
|
|
1,597 |
|
|
|
0.12 |
|
|
|
0.13 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Restructuring charges |
|
|
942 |
|
|
|
222 |
|
|
|
720 |
|
|
|
0.06 |
|
|
|
0.06 |
|
|
|
160 |
|
|
|
33 |
|
|
|
127 |
|
|
|
0.01 |
|
|
|
0.01 |
|
Non-GAAP
measures |
|
$ |
(2,487 |
) |
|
$ |
1,207 |
|
|
$ |
(3,694 |
) |
|
$ |
(0.30 |
) |
|
$ |
(0.30 |
) |
|
$ |
7,306 |
|
|
$ |
2,556 |
|
|
$ |
4,750 |
|
|
$ |
0.37 |
|
|
$ |
0.39 |
|
|
|
Year Ended December 31, 2019 |
|
|
Year Ended December 31, 2018 |
|
Reconciling Items |
|
Earnings (loss) before taxes |
|
|
Provision for income taxes |
|
|
Net (loss) earnings |
|
|
Class A EPS(3) |
|
|
Class B EPS(3) |
|
|
Earnings before taxes |
|
|
Provision for income taxes |
|
|
Net earnings |
|
|
Class A EPS(3) |
|
|
Class B EPS(3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
measures |
|
$ |
(7,302 |
) |
|
$ |
1,441 |
|
|
$ |
(8,743 |
) |
|
$ |
(0.71 |
) |
|
$ |
(0.71 |
) |
|
$ |
23,616 |
|
|
$ |
2,907 |
|
|
$ |
20,709 |
|
|
$ |
1.62 |
|
|
$ |
1.73 |
|
Items included in SG&A
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ERP system implementation consulting costs |
|
|
1,814 |
|
|
|
335 |
|
|
|
1,479 |
|
|
|
0.12 |
|
|
|
0.12 |
|
|
|
2,226 |
|
|
|
419 |
|
|
|
1,807 |
|
|
|
0.14 |
|
|
|
0.15 |
|
Acquisition-related costs |
|
|
232 |
|
|
|
53 |
|
|
|
179 |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Transition tax, measurement
period adjustment |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
2,628 |
|
|
|
(2,628 |
) |
|
|
(0.21 |
) |
|
|
(0.22 |
) |
Impairment of goodwill |
|
|
8,891 |
|
|
|
368 |
|
|
|
8,523 |
|
|
|
0.67 |
|
|
|
0.70 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Loss on liquidation of foreign
subsidiary |
|
|
2,103 |
|
|
|
506 |
|
|
|
1,597 |
|
|
|
0.12 |
|
|
|
0.13 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Gain on sale of building |
|
|
(4,257 |
) |
|
|
(979 |
) |
|
|
(3,278 |
) |
|
|
(0.26 |
) |
|
|
(0.27 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Restructuring charges |
|
|
2,593 |
|
|
|
502 |
|
|
|
2,091 |
|
|
|
0.16 |
|
|
|
0.17 |
|
|
|
222 |
|
|
|
45 |
|
|
|
177 |
|
|
|
0.01 |
|
|
|
0.01 |
|
Non-GAAP
measures |
|
$ |
4,074 |
|
|
$ |
2,226 |
|
|
$ |
1,848 |
|
|
$ |
0.12 |
|
|
$ |
0.16 |
|
|
$ |
26,064 |
|
|
$ |
5,999 |
|
|
$ |
20,065 |
|
|
$ |
1.57 |
|
|
$ |
1.68 |
|
(1) The
supplementary information included in this press release for 2019
is preliminary and subject to change prior to the filing of our
upcoming Annual Report on Form 10-K with the Securities and
Exchange Commission. |
(2) In this press
release and supplemental information, we have included Non-GAAP
financial measures, including Non-GAAP net earnings, Non-GAAP EPS,
EBITDA and Adjusted EBITDA. We present results adjusted to exclude
the effects of certain specified items and their related tax impact
that would otherwise be included under GAAP, to aid in comparisons
with other periods. We may use Non-GAAP financial measures to
determine performance-based compensation and management believes
that this information may be useful to investors. |
(3) Individual
amounts of earnings per share may not agree to the total due to
rounding. |
Investor Contact:Darrow Associatestel
516.419.9915pseltzberg@darrowir.com |
|
Company Contact:Daniel
Bernstein President ir@belf.com |
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