Belden Reports Strong Results in First Quarter 2013

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Belden Reports Strong Results in First Quarter 2013

ST. LOUIS--(BUSINESS WIRE)-- Belden Inc. (NYS: BDC) , a global leader in signal transmission solutions for mission-critical applications, today reported fiscal first quarter 2013 results for the period ended March 31, 2013.

First Quarter Highlights

  • Grew revenue by 15.4% year-over-year;
  • Improved adjusted operating income margin to 13.1%, increasing 400 basis points from 9.1% in the year-ago period;
  • Increased adjusted income from continuing operations per diluted share to $0.84, up 82.6% over last year's $0.46 per diluted share;
  • Purchased 612,982 shares of Belden common stock for $31.25 million during the quarter, bringing the total program-to-date shares repurchased to 4.32 million shares under both the previously announced program and recently announced extension, and
  • Raised full-year guidance for fiscal 2013 adjusted income from continuing operations per diluted share to $3.49 - $3.69.

First Quarter 2013

Revenue for the quarter totaled $507.5 million, up $67.9 million, or 15.4%, compared to $439.6 million in the first quarter 2012. Operating income margin in the first quarter was 8.7%, increasing 30 basis points from 8.4% in the year-ago period. Income from continuing operations per diluted share totaled $0.49, compared to $0.42 in the first quarter 2012, a year-over-year increase of 16.7%.

Adjusted revenue for the quarter totaled $510.4 million, up $70.8 million, or 16.1%, compared to $439.6 million in the first quarter 2012. On an organic basis, revenue was down slightly compared to the same period last year. Adjusted income from continuing operations per diluted share totaled $0.84, compared to $0.46 in the first quarter 2012, an increase of 82.6%. A non-GAAP reconciliation table is provided as an appendix to this release.

John Stroup, President and CEO of Belden Inc., said, "We're pleased with our strong start to the year. As expected, our two industrial platforms performed well in the quarter, and they more than offset demand weakness in our European and enterprise markets. Year-over-year operating income margin expansion is a clear highlight and a direct result of our business transformation and commitment to continuous improvement."


"Although the global macroeconomic environment has proven challenging and difficult to predict, we feel confident that our portfolio, business system, and focus on execution provide a level of stability and predictability. Therefore, we are increasing our earnings outlook for the full year," said Mr. Stroup.

Belden is now organized around four new global business segments: Broadcast, Enterprise Connectivity, Industrial Connectivity, and Industrial IT. Management believes that this will allow the Company to better execute its strategic plan, which includes the Market Delivery System and Lean Enterprise.

The Company expects second quarter 2013 revenues to be $530 - $540 million and adjusted income from continuing operations per diluted share to be $0.90 - $0.95. For the full year ending December 31, 2013, the Company expects revenues to be $2.07 - $2.12 billion and adjusted income from continuing operations per diluted share to be $3.49 - $3.69.

Earnings Conference Call

Management will host a conference call today at 10:30 a.m. Eastern to discuss results of the quarter. The listen-only audio of the conference call will be broadcast live via the Internet at 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 website for a limited time.

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 website at

Forward Looking Statements

Statements in this release other than historical facts are "forward looking statements" made in reliance upon the safe harbor of the Private Securities Litigation Reform Act of 1995. Forward looking statements include any 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 beliefs and expectations. They are not guarantees of future performance and they involve risk and uncertainty. The Company's actual results may differ materially from these expectations. Changes in the global economy may impact the Company's results. Turbulence in financial markets may increase the Company's borrowing costs. Additional factors that may cause actual results to differ from the Company's expectations include: the Company's reliance 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, 2012, filed with the SEC on February 28, 2013. Belden disclaims any duty to update any forward looking statements as a result of new information, future developments, or otherwise.

About Belden

Belden Inc., a global leader in high quality, end-to-end signal transmission solutions, delivers a comprehensive product portfolio designed to meet the mission-critical network infrastructure needs of industrial, enterprise and broadcast markets. With innovation 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; follow us on Twitter @BeldenInc.

Three Months Ended
March 31, 2013 April 1, 2012
(In thousands, except per share amounts)
Revenues $ 507,473 $ 439,600
Cost of sales   (340,120 )   (306,801 )
Gross profit 167,353 132,799
Selling, general and administrative expenses (91,982 ) (81,522 )
Research and development (20,425 ) (13,808 )
Amortization of intangibles (12,977 ) (3,084 )
Income from equity method investment   2,271     2,741  
Operating income 44,240 37,126
Interest expense (15,905 ) (11,919 )
Interest income   108     351  
Income from continuing operations before taxes 28,443 25,558
Income tax expense   (6,198 )   (5,819 )
Income from continuing operations 22,245 19,739
Income from discontinued operations, net of tax   -     4,536  
Net income $ 22,245   $ 24,275  
Weighted average number of common shares and equivalents:
Basic 44,420 45,912
Diluted 45,427 46,938
Basic income per share
Continuing operations $ 0.50 $ 0.43
Discontinued operations   -     0.10  
Net income $ 0.50   $ 0.53  
Diluted income per share
Continuing operations $ 0.49 $ 0.42
Discontinued operations   -     0.10  
Net income $ 0.49   $ 0.52  
Comprehensive income $ 14,892   $ 34,901  
Dividends declared per share $ 0.05 $ 0.05
Three months ended
March 31, 2013 April 1, 2012
External customer revenues: (In thousands)
Broadcast Solutions $ 155,586 $ 70,057
Enterprise Connectivity Solutions 116,627 124,352
Industrial Connectivity Solutions 176,721 169,633
Industrial IT Solutions 58,539 50,882
All other   -     24,676  
Consolidated $ 507,473   $ 439,600  
Operating income (loss):
Broadcast Solutions $ (146 ) $ 1,168
Enterprise Connectivity Solutions 8,835 9,752
Industrial Connectivity Solutions 24,449 18,973
Industrial IT Solutions 9,517 5,713
All other   -     (542 )
Total segments 42,655 35,064
Eliminations (686 ) (679 )
Income from equity method investment   2,271     2,741  
Consolidated $ 44,240   $ 37,126  
March 31, 2013 December 31, 2012
(In thousands)
Current assets:
Cash and cash equivalents $ 469,406 $ 395,095
Receivables, net 301,400 300,864
Inventories, net 219,068 215,282
Deferred income taxes 17,903 19,885
Other current assets   23,013     28,456  
Total current assets 1,030,790 959,582
Property, plant and equipment, less accumulated depreciation 302,767 307,048
Goodwill 778,989 778,708
Intangible assets, less accumulated amortization 417,390 428,273
Deferred income taxes 45,745 46,970
Other long-lived assets   72,298     64,002  
$ 2,647,979   $ 2,584,583  
Current liabilities:
Accounts payable $ 191,376 $ 183,672
Accrued liabilities 138,287 166,272
Current maturities of long-term debt 15,328 15,678
Current liabilities of discontinued operations   -     86,860  
Total current liabilities 344,991 452,482
Long-term debt 1,317,997 1,135,527
Postretirement benefits 140,690 144,320
Other long-term liabilities 41,842 40,394
Stockholders' equity:
Common stock 503 503
Additional paid-in capital 593,010 598,180
Retained earnings 481,750 461,756
Accumulated other comprehensive loss (37,918 ) (30,565 )
Treasury stock   (234,886 )   (218,014 )
Total stockholders' equity   802,459     811,860  
$ 2,647,979   $ 2,584,583  
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Three Months Ended
March 31, 2013 April 1, 2012
(In thousands)
Cash flows from operating activities:
Net income $ 22,245 $ 24,275
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Depreciation and amortization 22,546 12,157
Share-based compensation 3,419 2,977
Provision for inventory obsolescence 474 2,491
Pension funding less than pension expense 798 756
Income from equity method investment (2,271 ) (2,741 )
Tax benefit related to share-based compensation (4,227 ) (4,119 )

Changes in operating assets and liabilities, net of the effects of currency exchange rate changes and acquired businesses:

Receivables (9,785 ) 11,904
Inventories (2,723 ) (4 )
Accounts payable 5,520 (5,634 )
Accrued liabilities (30,347 ) (30,141 )