Belden reports results for fourth quarter and full year 2016
St. louis--(business wire)--belden inc. (nyse: bdc), a global leader in high quality, end-to-end signal transmission solutions for mission-critical applications, today reported fiscal fourth quarter and full year 2016 results for the period ended december 31, 2016. fourth quarter 2016 on a gaap basis, revenues for the quarter totaled $612.4 million, increasing $15.2 million, or 2.5%, compared to $597.2 million in the fourth quarter 2015. gross profit margin in the fourth quarter was 42.7%, increasing 80 basis points from 41.9% in the year-ago period. net income was $34.0 million compared to $49.7 million in the prior-year period. net income as a percentage of revenues was 5.5% in the fourth quarter, declining 280 basis points from 8.3% in the prior-year period. eps totaled $0.59 compared to $1.17 in the fourth quarter 2015. the prior year eps included incremental benefits of tax planning initiatives, and current year eps included the dilutive impact of the mandatory convertible preferred stock. adjusted revenues for the quarter totaled $608.2 million, increasing $5.7 million, or 0.9%, compared to $602.5 million in the fourth quarter 2015. adjusted gross profit margin was 43.4%, increasing 30 basis points from the year-ago period. adjusted ebitda margin was 20.1%, increasing 110 basis points from 19.0% in the year-ago period. adjusted eps was $1.42 compared to $1.63 in the fourth quarter 2015. the prior year adjusted eps included incremental benefits of tax planning initiatives, and current year eps included the dilutive impact of the mandatory convertible preferred stock. adjusted results are non-gaap measures, and a non-gaap reconciliation table is provided as an appendix to this release. john stroup, president, ceo and chairman of belden inc., said, “we are pleased to deliver another quarter of organic growth and margin expansion as our team continues to generate share capture and drive sustainable productivity improvements.” full year 2016 on a gaap basis, revenues for the year totaled $2.357 billion, up 2.1% compared to $2.309 billion in the full year 2015. gross profit margin in 2016 was 41.6%, increasing 180 basis points from 39.8% in the year-ago period. net income was $128.0 million compared to $66.2 million in 2015. net income as a percentage of revenues was 5.4% for the full year, increasing 250 basis points from 2.9% in the prior year. eps totaled $2.65, compared to $1.55 in 2015, an increase of 71.0%. adjusted revenues for the year totaled $2.358 billion, down slightly from $2.361 billion in 2015. adjusted gross profit margin in 2016 was 42.3%, increasing 70 basis points from 41.6% in the year-ago period. adjusted ebitda margin was 18.3%, increasing 130 basis points from 17.0% in the year-ago period. adjusted net income increased 12.3%, and adjusted eps increased 5.8% to $5.27, compared to $4.98 in 2015. mr. stroup remarked, “in 2016 we continued to significantly expand ebitda margins, which are now within our long-term goal of 18-20% as a result of improvements in all five platforms. in addition, we generated record operating and free cash flow. we see many opportunities to build on these successes in 2017 and beyond.” outlook “our balanced portfolio and proven business system allow us to perform well under a variety of market situations. consistent with our commitment to continuous improvement, we expect further ebitda margin expansion across the organization in 2017. we also expect another year of organic growth. when paired with our strong balance sheet and optimism around acquisition-related opportunities, we feel confident that belden remains well-positioned for success,” said mr. stroup. the company expects first quarter 2017 gaap and adjusted revenues to be $540 - $560 million. for the full year ending december 31, 2017, the company expects gaap and adjusted revenues to be $2.355 - $2.405 billion. the company expects first quarter 2017 gaap eps to be $0.41 - $0.51. for the full year ending december 31, 2017, the company expects gaap eps to be $3.35 - $3.60. the company expects first quarter 2017 adjusted eps to be $0.83 - $0.93. for the full year ending december 31, 2017, the company continues to expect adjusted eps to be $4.95 - $5.20. earnings conference call management will host a conference call today at 8:30 am et to discuss results of the quarter and full year. the listen-only audio of the conference call will be broadcast live via the internet at http://investor.belden.com. the dial-in number for participants in the u.s. is 888-339-3466; the dial-in number for participants outside the u.s. is 719-325-2360. a replay of this conference call will remain accessible in the investor relations section of the company’s web site for a limited time. net income and earnings per share (eps) all references to net income and eps within this earnings release refer to net income attributable to belden and income from continuing operations per diluted share attributable to belden common stockholders, respectively. 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 web site at http://investor.belden.com. belden inc.condensed consolidated statements of operations(unaudited) december 31, 2016 december 31, 2015 december 31, 2016 december 31, 2015 belden inc.operating segment information(unaudited) solutions connectivity solutions connectivity solutions it solutions security solutions segments for the three months ended december 31, 2016 for the three months ended december 31, 2015 for the twelve months ended december 31, 2016 for the twelve months ended december 31, 2015 belden inc.operating segment reconciliation to consolidated results(unaudited) december 31, 2016 december 31, 2015 december 31, 2016 december 31, 2015 (1) consolidated adjusted ebitda is a non-gaap measure. see reconciliation of non-gaap measures for additional information. belden inc.condensed consolidated balance sheets belden inc.condensed consolidated cash flow statements(unaudited) 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 and deferred revenue to fair value and transaction costs; severance, restructuring, and acquisition integration costs; gains (losses) recognized on the disposal of businesses and tangible assets; amortization of intangible assets; gains (losses) on debt extinguishment; certain revenues and 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 the purchase accounting effect of recording deferred revenue at fair value in order to reflect the revenues that would have otherwise been recorded by acquired businesses had they remained as independent entities. we believe this presentation is useful in evaluating the underlying performance of acquired companies. similarly, we adjust for other acquisition-related expenses, such as amortization of intangibles and other 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. december 31, 2016 december 31, 2015 december 31, 2016 december 31, 2015 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 tangible assets. we believe free cash flow provides useful information to investors regarding our ability to generate cash from business operations that is available for acquisitions and other investments, service of debt principal, dividends and share repurchases. we use free cash flow, as defined, as one financial measure to monitor and evaluate performance and liquidity. non-gaap financial measures should be considered only in conjunction with financial measures reported according to accounting principles generally accepted in the united states. our definition of free cash flow may differ from definitions used by other companies. december 31, 2016 december 31, 2015 december 31, 2016 december 31, 2015 belden inc.reconciliation of non-gaap measures2017 earnings guidance december 31, 2017 april 2, 2017 our guidance for income per diluted share attributable to belden common stockholders 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, purchase accounting effects related to acquisitions, severance, restructuring, and acquisition integration costs, gains (losses) recognized on the disposal of tangible assets, gains (losses) on debt extinguishment, discontinued operations, and other gains (losses) related to events or conditions that are not yet known. forward-looking statements this release contains, and statements made by us concerning the release may contain, forward-looking statements, including our expectations for the first quarter, and full-year 2017. forward-looking statements also include 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 a challenging global economy or a downturn in served markets; the cost and availability of raw materials including copper, plastic compounds, electronic components, and other materials; the competitiveness of the global broadcast, enterprise, and industrial markets; disruption of, or changes in, the company’s key distribution channels; volatility in credit and foreign exchange markets; the inability to execute and realize the expected benefits from strategic initiatives (including revenue growth, cost control, and productivity improvement programs); the inability to successfully complete and integrate acquisitions in furtherance of the company’s strategic plan; the inability of the company to develop and introduce new products and competitive responses to our products; 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; risks related to the use of open source software; the inability to retain senior management and key employees; disruptions in the company’s information systems including due to cyber-attacks; variability in the company’s quarterly and annual effective tax rates; perceived or actual product failures; political and economic uncertainties in the countries where the company conducts business, including emerging markets; the impairment of goodwill and other intangible assets and the resulting impact on financial performance; the impact of regulatory requirements and other legal compliance issues; 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 year ended december 31, 2015, filed with the sec on february 25, 2016. 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 a comprehensive product portfolio designed to meet the mission-critical network infrastructure needs of industrial, enterprise and broadcast markets. with innovative solutions targeted at reliable and secure transmission of rapidly growing amounts of data, audio and video needed for today’s applications, belden is at the center of the global transformation to a connected world. founded in 1902, the company is headquartered in st. louis and has manufacturing capabilities in north and south america, europe and asia. for more information, visit us at www.belden.com or follow us on twitter @beldeninc. bdc-e
