Molex Reports Record Revenue for Fiscal 2013 Second Quarter

Molex Reports Record Revenue for Fiscal 2013 Second Quarter

LISLE, Ill.--(BUSINESS WIRE)-- Molex Incorporated (NAS: MOLX) and (NAS: MOLXA) , a global electronic components company, today reported results for its second quarter ended December 31, 2012.

Three Months Ended

Dec 31,

Sept 30,

Dec 31,

USD millions, except per share data

2012

2012

2011

Net revenue

$

967.7

$

916.9

$

857.6

Net income

70.4

71.3

64.0

Earnings per share

0.39

0.40

0.36

Net revenue for the December 2012 quarter was $967.7 million, an increase of 5.5% from the September 2012 quarter and 12.8% from the December 2011 quarter. In local currencies, net revenue increased 4.8% compared with the September 2012 quarter and 13.8% compared with the December 2011 quarter. Orders for the December 2012 quarter were $919.7 million, a decline of 2.6% from the September 2012 quarter and an increase of 12.8% from the December 2011 quarter.


Net income for the December 2012 quarter was $70.4 million or $0.39 per share, compared with $71.3 million, or $0.40 per share, for the September 2012 quarter and $64.0 million, or $0.36 per share, for the December 2011 quarter.

"Our results came in at the high end of our guidance range and we were particularly pleased to achieve record revenue this quarter as shipments were strong leading into the Christmas period. Bookings were weaker toward the latter part of the quarter and consistent with normal seasonal trends, were down 2.6% on a sequential basis. Our pipeline of new projects is strong and we will have a clearer view of the business trends for calendar year 2013 after Chinese New Year," stated Martin P. Slark, Chief Executive Officer.

Other financial highlights for the quarter ended December 31, 2012:

  • Gross profit margin was 29.9%, compared with 29.3% in the September 2012 quarter and 30.7% in the December 2011 quarter.

  • SG&A expense was $181.0 million, compared with $163.1 million in the September 2012 quarter and $163.1 million in the December 2011 quarter. The September 2012 quarter included insurance proceeds of $9.9 million related to losses incurred from the March 2011 earthquake and tsunami in Japan.

  • Backlog was $404.0 million, a decrease of 9.3% from the September 2012 quarter and an increase of 16.7% from the December 2011 quarter.

  • The book-to-bill ratio for the December quarter was 0.95 to 1 compared with 1.03 to 1 for the September quarter and 0.95 to 1 for the December 2011 quarter.

  • Capital expenditures were $78.6 million or 8.1% of revenue.

  • Inventory days outstanding was 83 days compared with 84 days in the September 2012 quarter and 91 days in the December 2011 quarter.

  • Accounts receivable days outstanding was 67 days compared with 69 days in the September 2012 quarter and 71 days in the December 2011 quarter.

  • The effective tax rate was 31.1%.

Outlook

Based upon current order rates and customer backlog, the Company estimates revenue in the range of $900 to $930 million for the March 2013 quarter. At this level of revenue, the Company expects earnings per share in the range of $0.33 to $0.37, assuming constant foreign currency rates, unchanged commodity prices and an effective tax rate in the range of 30% to 32%.

Earnings Conference Call Information

A conference call will be held on Wednesday, January 23, 2013 at 8:30 a.m. central time. Please dial (888) 679-8035 to participate in the call. International callers should dial (617) 213-4848. Please dial in at least five minutes prior to the start of the call and refer to participant pass code 88944879. Internet users will be able to access the webcast, including slide materials, live and in replay in the "Investors" section of the Company's website at www.molex.com. A 48-hour telephone replay will be available at approximately 10:30 a.m. central time at (888) 286-8010 or (617) 801-6888 / pass code 81162241.

Other Investor Events

Feb 12 - Goldman Sachs Technology and Internet Conference in San Francisco, CA

Forward-Looking Statements

Statements in this release that are not historical are forward-looking and are subject to various risks and uncertainties that could cause actual results to vary materially from those stated.Words such as "expect," "anticipate," "outlook," "forecast," "could," "project," "intend," "plan," "continue," "believe," "seek," "estimate," "should," "may," "assume," "potential," variations of such words and similar expressions are used to identify these forward-looking statements.Forward-looking statements are based on currently available information and include, among others, the discussion under "Outlook."These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Respective risks, uncertainties, and assumptions that could affect the outcome or results of operations are described in Part 1, Item 1A of our Annual Report on Form 10-K for the year ended June 30, 2012, and the Form 10-Q for the quarter ended September 30, 2012, which is incorporated by reference and in other reports that Molex files or furnishes with the Securities and Exchange Commission.

We have based our forward-looking statements on our management's beliefs and assumptions based on information available to management at the time the statements are made. We caution you that actual outcomes and results may differ materially from what is expressed, implied, or forecast by our forward-looking statements. Reference is made in particular to forward-looking statements regarding growth strategies, industry trends, global economic conditions, success of customers, cost of raw materials, value of inventory, availability of credit, foreign currency exchange rates, labor costs, protection of intellectual property, cost reduction initiatives, acquisition synergies, manufacturing strategies, product development introduction and sales, regulatory changes, competitive strengths, income tax fluctuations, natural disasters, unauthorized access to data, government investigations and outcomes of legal proceedings. Except as required under the federal securities laws, we do not have any intention or obligation to update publicly any forward-looking statements after the distribution of this report, whether as a result of new information, future events, changes in assumptions, or otherwise.

Molex Incorporated is a 74-year-old global manufacturer of electronic, electrical and fiber optic interconnection systems. Based in Lisle, Illinois, USA, the Company operates 41 manufacturing locations in 15 countries. The Molex website is www.molex.com.

Editor's note: Molex is traded on the NASDAQ Global Select Market (MOLX and MOLXA) in the United States and on the London Stock Exchange. The Company's voting common stock (MOLX) is included in the S&P 500 Index.

Molex Incorporated

Condensed Consolidated Balance Sheets

(in thousands)

Dec. 31,

June 30,

2012

2012

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$

705,047

$

637,417

Marketable securities

11,738

14,830

Accounts receivable, less allowances of $37,681 and $37,876, respectively

745,851

751,279

Inventories

566,889

531,825

Deferred income taxes

101,398

110,789

Other current assets

33,109

33,098

Total current assets

2,164,032

2,079,238

Property, plant and equipment, net

1,177,342

1,150,549

Goodwill

195,030

160,986

Non-current deferred income taxes

48,063

50,038

Other assets

180,130

170,692

Total assets

$

3,764,597

$

3,611,503

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Current portion of short-term borrowings and long-term debt

$

115,869

$

104,933

Accounts payable

344,997

355,491

Accrued expenses:

Accrued liability for unauthorized activities in Japan

170,665

184,177

Income taxes payable

40,876

35,360

Other

200,084

212,035

Total current liabilities

872,491

891,996

Other non-current liabilities

19,700

18,174

Accrued pension and other postretirement benefits

95,424

115,176

Long-term debt

230,000

150,032

Total liabilities

1,217,615

1,175,378

Commitments and contingencies

Total stockholders' equity

2,546,982

2,436,125

Total liabilities and stockholders' equity

$

3,764,597

$

3,611,503

Molex Incorporated

Condensed Consolidated Statements of Income

(Unaudited)

(in thousands, except per share data)

Three Months Ended

Six Months Ended

December 31,

December 31,

2012

2011

2012

2011

Net revenue

$

967,735

$

857,598

$

1,884,656

$

1,793,583

Cost of sales

678,565

594,661

1,327,069

1,237,918

Gross profit

289,170

262,937

557,587

555,665

Selling, general and administrative

181,028

163,073

344,149

332,298

Unauthorized activities in Japan

1,627

2,723

4,188

5,645

Total operating expenses

182,655

165,796

348,337

337,943

Income from operations

106,515

97,141

209,250

217,722

Interest (expense) income, net

(1,133

)

(2,094

)

(1,943

)

(3,485

)

Other (expense) income

(3,151

)

1,482

(1,955

)

1,758

Total other (expense) income, net

(4,284

)

(612

)

(3,898

)

(1,727

)

Income before income taxes

102,231

96,529

205,352

215,995

Income taxes

31,837

32,513

63,644

71,462

Net income

$

70,394

$

64,016

$

141,708

$

144,533

Earnings per share:

Basic

$

0.40

$

0.36

$

0.80

$

0.82

Diluted

$

0.39

$

0.36

$

0.79

$

0.82

Dividends declared per share

$

0.2200

$

0.2000

$

0.4400

$

0.4000

Average common shares outstanding:

Basic

177,123

175,830

176,888

175,656

Diluted

178,854

176,985

178,743

176,778

Molex Incorporated

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(in thousands)

Six Months Ended

December 31,

2012

2011

Operating activities:

Net income

$

141,708

$

144,533

Add non-cash items included in net income:

Depreciation and amortization

117,402

121,174

Share-based compensation

15,425

11,402

Other non-cash items

5,685

5,213

Changes in assets and liabilities:

Accounts receivable

5,006

94,400

Inventories

(34,831

)

(26,442

)

Accounts payable

(5,326

)

(40,976

)

Other current assets and liabilities

9,605

(7,183

)

Other assets and liabilities

(97

)

(10,608

)

Cash provided from operating activities

254,577

291,513

Investing activities:

Capital expenditures

(148,041

)

(95,055

)

Acquisitions

(55,299

)

(24,000

)

Proceeds from sales of property, plant and equipment

3,020

2,202

Proceeds from sales or maturities of marketable securities

8,399

6,553

Purchases of marketable securities

(5,081

)

(4,787

)

Insurance proceeds and other investing activities

9,957

-

Cash used for investing activities

(187,045

)

(115,087

)

Financing activities:

Proceeds from revolving credit facility

90,000

75,000

Payments on revolving credit facility