Bel Fuse Inc. (NASDAQ:BELFA) (NASDAQ:BELFB) today
announced preliminary unaudited financial results for the fourth
quarter and 2009.
"The trends in our business are moving in the right direction.
Revenue has now increased for three consecutive quarters. Expenses
are down, our operating loss has narrowed, and net income for the
fourth quarter of 2009 was up from the prior quarter and prior
year. We are optimistic about the opportunity for further top and
bottom-line growth in 2010 as production efficiencies improve and
we begin to benefit from the recent acquisition of Cinch
Connectors," said Daniel Bernstein, Bel's President and CEO.
"Due to the increase in backlog primarily in our magnetics
group, we are seeking to hire an additional 2,800 workers at our
China facilities. As anticipated, progress in hiring additional
workers has been modest as we approach the Lunar New Year holiday
period, but with the new recruitment and retention programs that
Bel has implemented we expect a significant improvement in hiring
after the holidays," Bernstein said.
Fourth Quarter Results
Net sales for the three months ended December 31, 2009 decreased
to $48,665,000 compared to $58,063,000 for the fourth quarter of
2008, but increased 7.5% sequentially compared to $45,283,000 for
the third quarter of 2009. The operating loss for the fourth
quarter of 2009 narrowed to $808,000, compared to an operating loss
of $18,264,000 for the fourth quarter of 2008 and an operating loss
of $15,930,000 for the third quarter of 2009. The operating loss in
the fourth quarter of 2008 was impacted by a $14,066,000 charge for
impairment of goodwill, as well as $739,000 for impairment of fixed
assets and restructuring charges of $793,000 for the termination of
manufacturing operations at the Company's DC-DC manufacturing
facility in Massachusetts. During the third quarter of 2009, the
Company recorded an additional $12,875,000 charge for impairment of
goodwill, and recorded a $2 million settlement of a lawsuit.
Net income for the fourth quarter of 2009 included a pre-tax net
gain of $5,390,000 ($3,342,000 or $0.29 per share after tax)
primarily from the sale of the Company's equity interest in
Power-One, Inc. (NASDAQ:PWER). This gain represents the difference
between the sales price of the Power-One shares and the
written-down value at December 31, 2008 (based on original cost,
the Company actually realized a gain on the sale of Power-One
shares in the amount of $2,860,000, or $1,773,000 after tax). This
gain more than offset an operating loss of $808,000, which included
costs of $550,000 ($344,000 or $0.03 per share after tax) related
to the Cinch acquisition and severance costs of $130,000 ($81,000
or $0.01 per share after tax).
The net loss for the fourth quarter of 2008 included a charge of
$6,328,000 primarily associated with a write-down of the market
value of Bel's investment in the common stock of Power One.
Net earnings per diluted Class A common share for the fourth
quarter of 2009 were $0.23, compared to a net loss per Class A
common share of $1.75 for the fourth quarter of 2008. Net earnings
per diluted Class B common share were $0.25 for the fourth quarter
of 2009, compared to a net loss per diluted Class B common share of
$1.82 for the fourth quarter of 2008.
At December 31, 2009, Bel reported working capital of
approximately $167,800,000, including cash, cash equivalents,
short-term investments and marketable securities of approximately
$124,233,000, a current ratio of 7.0, total long-term obligations
of $9,017,000, and stockholders' equity of $208,932,000. In
comparison, at December 31, 2008, Bel reported working capital of
approximately $164,000,000, including cash, cash equivalents,
short-term investments and marketable securities of approximately
$92,700,000, a current ratio of 6.5, total long-term obligations of
$14,377,000, and stockholders' equity of $217,773,000. Bel
repurchased a total of 6,070 of its Class A common shares during
2009 for $92,000.
Twelve Month Results
For the twelve months ended December 31, 2009, net sales were
$182,753,000 compared to $258,350,000 for 2008. The net loss for
2009 was $8,310,000, compared to a net loss of $14,929,000 for
2008.
The net loss per Class A common share for 2009 was $0.71,
compared to a net loss per Class A common share of $1.25 for 2008.
The net loss per Class B common share for 2009 was $0.72, compared
to a net loss per Class B common share of $1.28 for 2008.
Acquisition of Cinch Connectors
On January 29, 2010, Bel completed the acquisition of Cinch
Connectors from Safran S.A. (ENXTPA:SAF), a leading French
industrial group, for approximately $37.5 million in cash plus
approximately $1.5 million for the assumption of certain expenses.
The final purchase price remains subject to certain adjustments
related to working capital.
Founded in 1920 and headquartered in Lombard, Illinois with
manufacturing facilities in Vinita, Oklahoma, Reynosa, Mexico and
Worksop, England, Cinch had revenue for 2009 of approximately $56
million. The transaction, which was funded with cash on hand, is
expected to be accretive to Bel's earnings in 2010.
"The addition of Cinch's well-established lines of connector and
cable products and extensive customer base provides Bel with
immediate access to large and growing aerospace and military
markets and strengthens Bel's position as a one-stop supplier of
high-performance computing, telecom and data products," Bernstein
said.
Conference Call
Bel has scheduled a conference call at 4:00 p.m. EST today. To
participate in the call, dial (913) 312-0668, passcode #2264470. A
simultaneous webcast of the conference call may be accessed from
the Events and Presentations link on the Investor Info tab at
www.belfuse.com. A replay will be available after 6:00 p.m. EST,
for a period of 20 days, at this same Internet address. For a
telephone replay, dial (719) 457-0820, passcode #2264470 after 6:00
p.m. EST.
About Bel
Bel (www.belfuse.com) and its subsidiaries are primarily engaged
in the design, manufacture and sale of products used in networking,
telecommunications, high speed data transmission, commercial
aerospace, military, transportation and consumer electronics.
Products include magnetics (discrete components, power transformers
and MagJack7s), modules (DC-DC converters, integrated analog front
end modules and custom designs), circuit protection (miniature,
micro and surface mount fuses) and interconnect devices (micro,
circular and filtered D-Sub connectors, passive jacks, plugs and
high-speed cable assemblies). Bel operates facilities around the
world.
Forward-Looking Statements
Except for historical information contained in this news
release, the matters discussed in this press release (including
statements regarding potential bottom and top line growth,
potential benefits arising from the Cinch Connectors acquisition
and the potential accretive effect of the Cinch Connectors
acquisition) are forward looking statements that involve risks and
uncertainties. 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 effect of business and economic conditions;
capacity and supply constraints or difficulties; product
development, commercializing or technological difficulties; the
regulatory and trade environment; risks associated with integrating
the Cinch Connectors business into the Company's existing business;
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 and
the risk factors detailed from time to time in the Company's SEC
reports. In light of the risks and uncertainties, 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.
BEL FUSE INC. AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF OPERATIONS (000s omitted, except for per share data)
Three Months Ended Twelve
Months Ended December 31, December 31, 2009 2008 2009
2008 (unaudited) (unaudited) Net Sales $
48,665 $ 58,063 $ 182,753 $ 258,350
Costs and expenses: Cost of sales 41,535 51,787 161,454
217,079 Selling, general and administrative 7,988 8,942 30,055
36,093 Impairment of assets -- 14,805 12,875 14,805 Restructuring
charge -- 793 413 1,122 Gain on sale of property, plant and
equipment (50 ) -- (4,693 ) --
49,473 76,327 200,104
269,099 Loss from operations (808 )
(18,264 ) (17,351 ) (10,749 ) Gain (loss/impairment charge) on
investment 5,390 (6,328 ) 7,129 (10,358 ) Interest income and
other, net 125 409 527
2,454 Earnings (loss) before provision 4,707
(24,183 ) (9,695 ) (18,653 ) for (benefit from) income taxes Income
tax provision (benefit) 1,809 (3,330 )
(1,385 ) (3,724 ) Net earnings (loss) $ 2,898
$ (20,853 ) $ (8,310 ) $ (14,929 ) Earnings (loss) per Class
A common share-basic(1) $ 0.23 $ (1.75 ) $ (0.71 ) $ (1.25 )
Earnings (loss) per Class A common
share-diluted(1)
$
0.23
$
(1.75
)
$
(0.71
)
$
(1.25
)
Weighted average Class A common shares outstanding Basic(1)
2,175 2,184 2,175
2,391
Diluted(1)
2,175
2,184
2,175
2,391
Earnings (loss) per Class B common share-basic(1) $
0.25 $ (1.82 ) $ (0.72 ) $ (1.28 )
Earnings (loss) per Class B common
share-diluted(1)
$
0.25
$
(1.82
)
$
(0.72
)
$
(1.28
)
Weighted average Class B common shares outstanding Basic(1)
9,423 9,370 9,363
9,351
Diluted(1)
9,423
9,370
9,363
9,351
(1) The Company adopted the update to Accounting
Standards Codification 260 effective January 1, 2009, which
required that all 2008 outstanding shares and EPS figures be recast
to include certain participating securities. The impact of the
adoption was not more than 0.03 per share in any period presented
above.
CONDENSED CONSOLIDATED BALANCE SHEET
DATA (000s omitted)
Dec. 31,
Dec. 31,
Dec. 31,
Dec. 31,
ASSETS 2009 2008
LIABILITIES & EQUITY 2009 2008
(unaudited) (audited)
(unaudited)
(audited)
Current assets
$
195,830
$
193,619
Current liabilities
$
27,997
$
29,634
Property, plant & equipment, net 35,943 39,936 Noncurrent
liabilities 9,017 14,377 Goodwill 1,957 14,334 Intangibles &
other assets 12,216 13,895 Stockholders' equity
208,932 217,773
Total Assets
$
245,946
$
261,784
Total Liabilities & Equity
$
245,946
$
261,784
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