Belden reports record revenues in the second quarter 2014
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 second quarter 2014 results for the period ended june 29, 2014. second quarter 2014 highlights grew revenues by 13.5% from the year-ago period; generated record adjusted income from continuing operations per diluted share of $1.05; achieved record adjusted gross profit margins of 37.0%, an increase of 180 basis points from 35.2% in the second quarter 2013; announced the purchase of prosoft, a leader in innovative solutions within the industrial market, for approximately $103 million; and purchased 424,469 shares of belden common stock for $31.2 million during the quarter. second quarter 2014 on a gaap basis, revenues for the quarter totaled $600.9 million and were a company record. revenues were up $71.4 million, or 13.5%, compared to $529.5 million in the second quarter 2013. gross profit margin in the second quarter was 34.0%, increasing 20 basis points from 33.8% in the year-ago period. operating profit margin in the second quarter was 2.1%, decreasing from 10.2% in the year-ago period. income from continuing operations per diluted share was $0.00, compared to $0.66 in the second quarter 2013. both operating profit margin and income from continuing operations per diluted share were impacted by previously announced acquisition related restructuring expenses and productivity enhancement programs that were implemented during the quarter. adjusted revenues for the quarter totaled $605.1 million and were also a company record. adjusted revenues were up $72.5 million, or 13.6%, compared to $532.6 million in the second quarter 2013. adjusted gross profit margin in the second quarter was 37.0%, increasing 180 basis points from 35.2% in the year-ago period. adjusted operating profit margin in the second quarter was 13.0%, decreasing 120 basis points from 14.2% in the year-ago period, due to the initial impact of recently acquired grass valley. adjusted income from continuing operations per diluted share totaled $1.05, compared to $0.99 in the second quarter 2013. a non-gaap reconciliation table is provided as an appendix to this release. john stroup, president and ceo of belden inc., said, “i’m proud of our ability to deliver record results in the second quarter including revenues of $605.1 million, earnings per share of $1.05, and gross margins of 37.0%. i’m also pleased to announce the acquisition of prosoft, a leader in innovative technology to industrial markets. so far this year, we’ve deployed more than $340 million in strategic acquisitions and share repurchases. overall, the business performed well, with revenue strength in our broadcast and industrial connectivity platforms offsetting the margin expansion initiatives within our enterprise connectivity business.” outlook “the integration of grass valley is progressing well, and we look forward to the benefits of prosoft joining the company. we remain committed to our strategic plan as we shift our focus and resources towards higher value products and services, and believe the best is still before us,” said mr. stroup. the company expects third quarter 2014 adjusted revenues to be $605 – $625 million and adjusted income from continuing operations per diluted share to be $1.05 – $1.15. for the full year ending december 31, 2014, the company expects adjusted revenues to be $2.30 – $2.35 billion and adjusted income from continuing operations per diluted share to be $4.10 – $4.30. on a gaap basis, the company expects third quarter 2014 revenues to be $599 – $619 million and income from continuing operations per diluted share to be $0.43 – $0.53. for the full year ending december 31, 2014, the company expects revenues to be $2.28 – $2.33 billion and income from continuing operations per diluted share to be $1.68 – $1.88. earnings conference call management will host a conference call today at 10:30 am edt 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. an accompanying slide presentation and transcript of the prepared remarks will be available for download shortly before the call begins. the dial-in number for participants in the u.s. is 888-599-8685; the dial-in number for participants outside the u.s. is 913-312-0403. a replay of this conference call will remain accessible in the investor relations section of the company’s web site for a limited time. condensed consolidated statements of operations and selling, general and administrative expenses income (loss) from continuing operations before taxes income from continuing operations loss from disposal of discontinued operations, net of tax weighted average number of common shares and equivalents: changes in operating assets and liabilities, net of the effects of currency exchange rate changes and acquired businesses: belden inc.reconciliation of non-gaap measures(unaudited) we define free cash flow, which is a non-gaap financial measure, as net cash provided by operating activities adjusted for capital expenditures net of the proceeds from the disposal of tangible assets, non-recurring tax payments related to divestitures and the settlement of a tax sharing agreement, and cash payments for severance and other costs for the integration of our 2014 acquisition of grass valley. 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. capital expenditures, net of proceeds from the disposal of tangible assets non-recurring tax payments made for gain on 2012 sale of thermax and raydex cable business non-recurring tax payments made in settlement of tax sharing agreement with cooper industries cash paid for severance and other costs for the integration of our acquisition of grass valley 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; revenue and cost of sales deferrals for acquired product lines subject to software revenue recognition accounting requirements; severance, restructuring, and acquisition integration costs; gains (losses) recognized on the disposal of businesses and tangible assets; amortization of intangible assets; and other costs. 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. adjusted results should be considered only in conjunction with results reported according to accounting principles generally accepted in the united states. adjusted gross profit margin adjusted operating income margin 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; revenue and cost of sales deferrals for acquired product lines subject to software revenue recognition accounting requirements; severance, restructuring, and acquisition integration costs; gains (losses) recognized on the disposal of businesses and tangible assets; amortization of intangible assets; and other costs. 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. adjusted results should be considered only in conjunction with results reported according to accounting principles generally accepted in the united states. broadcastsolutions enterpriseconnectivitysolutions industrialconnectivitysolutions industrial itsolutions all other total segments income fromequity methodinvestment broadcastsolutions enterpriseconnectivitysolutions industrialconnectivitysolutions industrial itsolutions income fromequity methodinvestment adjusted operating income margin our guidance for revenues and income from continuing operations per diluted share is based upon the extent of information currently available regarding events and conditions that will impact our future operating results for 2014. our actual results may be impacted by other additional events for which information is not available, such as asset impairments, purchase accounting effects related to acquisitions, severance and other restructuring costs, gains (losses) recognized on the disposal of tangible assets, gains (losses) on debt extinguishment, and other gains (losses) related to events or conditions that are not yet known. 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. all gaap to non-gaap reconciliations accompany the 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. forward looking statements this release contains forward looking statements including our expectations for the third quarter and full-year 2014. forward looking statements also include any other statements regarding future revenues, costs and expenses, operating income, earnings per share, margins, cash flows, dividends, and capital expenditures. these forward looking statements are based on forecasts and projections about the markets and industries served by the company and about general economic conditions. they reflect management’s current beliefs and expectations and are not guarantees of future performance. the company’s actual results may differ materially from these expectations for a number of reasons including: changes in the global economy may impact the company’s results; turbulence in financial markets may increase the company’s borrowing costs; the company relies on key distributors in marketing products; the company’s ability to execute and realize the expected benefits from strategic initiatives (including revenue growth, cost control, and productivity improvement programs); changes in the level of economic activity in the company’s major geographic markets; difficulties in realigning manufacturing capacity and capabilities among the company’s global manufacturing facilities; the competitiveness of the global broadcast, enterprise, and industrial markets; variability in the company’s quarterly and annual effective tax rates; changes in accounting rules and interpretation of these rules which may affect the company’s reported earnings; changes in currency exchange rates and political and economic uncertainties in the countries where the company conducts business; demand for the company’s products; the cost and availability of materials including copper, plastic compounds derived from fossil fuels, electronic components, and other materials; energy costs; the company’s ability to achieve acquisition performance expectations and to integrate acquired businesses successfully; the ability of the company to develop and introduce new products; the company having to recognize charges that would reduce income as a result of impairing goodwill and other intangible assets; security risks and the potential for business interruption from operating in volatile countries; disruptions or failures of the company’s (or the company’s suppliers or customers) systems or operations in the event of a major earthquake, weather event, cyber-attack, terrorist attack, or other catastrophic event that could cause delays in completing sales, providing services, or performing other mission-critical functions; 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, 2013, filed with the sec on february 27, 2014. 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 st. louis−based 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
