Bel Fuse Inc. (NASDAQ:BELFA)(NASDAQ:BELFB) today
announced preliminary unaudited financial results for the first
quarter of 2010.
Net sales for the three months ended March 31, 2010, Bel's
seasonally weakest quarter of the year, increased 28% to
$56,149,000 compared to $43,871,000 for the first quarter of 2009.
This year's first quarter net sales included $9,883,000 from Cinch
Connectors, which was acquired on January 29, 2010. Excluding these
Cinch Connector sales, net sales increased 5.5% for this year's
first quarter versus prior year and decreased 5% versus the fourth
quarter of 2009.
Net earnings for the first quarter of 2010 were $32,000, which
included severance costs of $575,000 ($503,000 after tax), and
acquisition-related costs and inventory-related purchase accounting
adjustments of $1,078,000 ($668,000 after tax). Net earnings for
the first quarter of 2009 were $816,000, which included a gain of
$4,665,000 ($2,892,000 after tax) on the sale of a building, and
restructuring and severance costs of $641,000 ($459,000 after
tax).
Adjusted for the severance costs, acquisition-related costs and
inventory-related purchase accounting adjustments, non-GAAP net
income for the first quarter of 2010 increased to $1,203,000. This
compares to a non-GAAP net loss for the first quarter of 2009 of
$1,617,000, which were adjusted for restructuring and severance
costs and gains on sale of property, plant and equipment. A
reconciliation of non-GAAP to GAAP financial measures is provided
in the table attached to this press release.
Net earnings per diluted Class A common share for the first
quarter of 2010 were $0.00, compared to net earnings per diluted
Class A common share of $0.06 for the first quarter of 2009.
Adjusted for severance costs, acquisition-related costs and
inventory-related purchase accounting adjustments, non-GAAP net
earnings per diluted Class A common share were $0.09 for this
year's first quarter, compared to a non-GAAP net loss per Class A
common share of $0.14 for the first quarter of 2009, which were
adjusted for restructuring and severance costs and gains on sale of
property, plant and equipment.
Net earnings per diluted Class B common share were $0.00 for the
first quarter of 2010, compared to net earnings per diluted Class B
common share of $0.07 for the first quarter of 2009. Adjusted for
severance costs, acquisition-related costs and inventory-related
purchase accounting adjustments, non-GAAP net earnings per diluted
Class B common share were $0.11 for the first quarter of 2010,
compared to a non-GAAP net loss per Class B common share of $0.14
for the first quarter of 2009, which were adjusted for
restructuring and severance costs and gains on sale of property,
plant and equipment.
Including a loss from operations of $321,000 at Cinch
Connectors, the loss from operations for this year's first quarter
was $66,000, compared to income from operations of $2,259,000 for
the first quarter of 2009. Adjusted for severance costs,
acquisition-related costs and inventory-related purchase accounting
adjustments, non-GAAP income from operations for the first quarter
of 2010 increased to $1,587,000, compared to a non-GAAP loss from
operations of $1,765,000 for the first quarter of 2009, which were
adjusted for restructuring and severance costs and gains on sale of
property, plant and equipment. Since its acquisition on January 29,
2010, Cinch Connectors has contributed $788,000 in non-GAAP income
from operations during the first quarter of 2010.
At March 31, 2010, Bel reported working capital of approximately
$138,300,000, including cash, cash equivalents, short-term
investments and marketable securities of approximately $79,900,000,
a current ratio of 5.2, total long-term obligations of $9,260,000,
and stockholders' equity of $208,121,000. In comparison, at
December 31, 2009, Bel reported working capital of approximately
$167,900,000, 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.
Daniel Bernstein, Bel's President and CEO, said, "The
integration of Cinch Connectors is proceeding smoothly, and we are
pleased by the high quality of the people, products, customers and
facilities this transaction brings to Bel. The addition of Cinch's
well-established lines of connectors and cable products and
extensive customer base helps to diversify our product offerings
and provides Bel with immediate access to large and growing
aerospace and military markets. The Cinch acquisition has
strengthened Bel's position as a one-stop supplier of
high-performance computing, telecom and data products.
"As evidenced by our strong backlog, business conditions in our
markets continue to improve. The many steps we took during the past
few quarters to streamline our operations and reduce costs are now
working to improve profitability and set the stage for better
performance going forward. During the quarter we hired
approximately 1,400 new workers at our China facilities toward our
goal of 2,800 new hires. Our operating results in the first quarter
are especially noteworthy in view of the inexperience of these new
workers, whose efficiency can be expected to increase as they gain
experience on the job in coming months."
Conference Call
Bel has scheduled a conference call at 11:00 a.m. EDT today. To
participate in the call, dial (720) 545-0088, conference ID
#68715481. You can access a simultaneous webcast of the conference
call at the Events and Presentations link of the Investor Info tab
at www.belfuse.com. A replay will be available for a period of 20
days at this same Internet address. For a telephone replay, dial
(706) 645-9291, conference ID #68715481 after 2:00 p.m. EDT.
About Bel
Bel (www.belfuse.com) and its divisions 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 MagJack® connectors with integrated magnetics), modules (DC/DC
converters, integrated analog front-end modules, 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).
The Company 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 the Cinch Connector acquisition, future
profitability, future performance and efficiency of our workers)
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
March 31,
2010
2009
(unaudited)
Net Sales
$
56,149
$
43,871
Costs and expenses:
Cost of sales
47,053
38,211
Selling, general and
administrative
9,162
7,653
Restructuring charge
--
413
Gain on sale of property, plant
and equipment
--
(4,665
)
56,215
41,612
(Loss) income from operations
(66
)
2,259
Interest income and other, net
122
191
Earnings before provision for
income taxes
56
2,450
Income tax provision
24
1,634
Net earnings
$
32
$
816
Earnings per Class A common share
- basic and diluted
$
0.00
$
0.06
Weighted average Class A common
shares outstanding - basic and diluted
2,175
2,176
Earnings per Class B common share
- basic and diluted
$
0.00
$
0.07
Weighted average Class B common
shares outstanding - basic and diluted
9,464
9,362
CONDENSED CONSOLIDATED BALANCE
SHEET DATA
(000s omitted)
Mar. 31,
Dec. 31,
Mar. 31,
Dec. 31,
ASSETS
2010
2009
LIABILITIES &
EQUITY
2010
2009
(unaudited)
(audited)
(unaudited)
(audited)
Current assets
$
171,504
$
195,830
Current liabilities
$
33,176
$
27,997
Property, plant &
equipment, net
42,504
35,943
Noncurrent liabilities
9,260
9,017
Goodwill
19,883
1,957
Intangibles & other assets
16,666
12,216
Stockholders' equity
208,121
208,932
Total Assets
$
250,557
$
245,946
Total Liabilities & Equity
$
250,557
$
245,946
BEL FUSE INC. AND SUBSIDIARIES NON-GAAP
MEASURES (unaudited) (000s omitted, except for per share data)
Three Months Ended March 31, 2010 (Loss)
income
from
Operations
Net
earnings(2)
Net earnings per Class A
common
share - diluted(3)
Net earnings per Class B
common
share - diluted(3)
GAAP measure $ (66 ) $ 32 $ 0.00 $ 0.00 Severance costs 575
503 0.04 0.04 Acquisition-related costs and inventory related
purchase accounting adjustments 1,078 668
0.06 0.06 Non-GAAP
measures excluding severance, acquisition-related costs, and
purchase accounting(1) $ 1,587 $ 1,203 $ 0.09
$ 0.11 Three Months Ended March 31,
2009
Income
(loss) from Operations
Net earnings
(loss)(2)
Net earnings (loss) per Class
A common
share - diluted(3)
Net earnings (loss) per Class
B common
share - diluted(3)
GAAP measure $ 2,259 $ 816 $ 0.06 $ 0.07
Restructuring and severance costs 641 459 0.04 0.04 Gain on sale of
property, plant and equipment (4,665 ) (2,892 )
(0.24 ) (0.25 ) Non-GAAP measures excluding
restructuring, severance, and gain on sale of property, plant and
equipment(1) $ (1,765 ) $ (1,617 ) $ (0.14 ) $ (0.14 )
(1) The non-GAAP measures presented above are
not measures of performance under accounting principles generally
accepted in the United States of America ("GAAP"). These measures
should not be considered a substitute for, and the reader should
also consider, (loss) income from operations, net earnings,
earnings per share and other measures of performance as defined by
GAAP as indicators of our performance or profitability. Our
non-GAAP measures may not be comparable to other similarly-titled
captions of other companies due to differences in the method of
calculation. Based upon discussions with investors and
analysts, we believe that the reader's understanding of Bel's
performance and profitability is enhanced by reference to these
non-GAAP measures. Removal of gains on sales of real estate and
charges for severance, restructuring, inventory-related purchase
accounting and acquisition-related costs facilitates comparisons of
our results among reporting periods and with peer companies. Such
amounts are not reflective of the relevant business in the period
in which the gain or charge is recorded for accounting purposes.
(2) Net of income tax at effective rate in the applicable
tax jurisdiction. (3) Individual amounts of earnings (loss)
per share may not agree to the total due to rounding.
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