Bel Fuse Inc. (NASDAQ:BELFA) (NASDAQ:BELFB), a
leading global manufacturer of products that power, protect and
connect electronic circuits, announces preliminary financial
results for the third quarter of 2017.
Third Quarter 2017
Highlights
- Net sales of $126.4 million, down 1.9% year over year
- Gross profit margin of 21.9%, up 130 basis points year over
year
- GAAP earnings per share of $0.40 (Class A) and $0.42 (Class B),
versus $0.78 (Class A) and $0.82 (Class B) in the third quarter
2016
- GAAP net earnings of $5.0 million (4.0% of sales) compared to
$9.7 million (7.5% of sales) in the third quarter of 2016
- Adjusted Non-GAAP EBITDA of $12.2 million (9.6% of sales)
compared to $13.2 million (10.2% of sales) in the third quarter
2016
- Debt repayments of $9.8 million during the quarter
Non-GAAP financial measures, such as Non-GAAP
EPS and EBITDA, exclude the impact of costs associated with a legal
entity restructuring, ERP system implementation costs, impairment
charges, restructuring charges and certain other items. Please
refer to the financial information included with this press release
for reconciliations of GAAP financial measures to Non-GAAP
financial measures and our explanation of why we present Non-GAAP
financial measures.
CEO CommentsDaniel Bernstein,
President and CEO, said, “A more favorable sales mix, led by growth
within our Connectivity Solutions and Magnetics Solutions product
groups this quarter, enabled a higher gross margin and a higher
gross profit for Bel in the third quarter, despite slightly lower
sales.
“Bel’s Connectivity Solutions business had a
solid third quarter with both sales and profit improving, along
with most other key metrics, compared to the same quarter last
year. Orders booked in the quarter led to an improved backlog
position as compared to the same time last year and the
book-to-bill ending the quarter remains positive. Improvements have
been made in the areas of materials and resource management with
inventory turns increasing slightly while lead times remained
generally flat to down. We continue to work closely with our
strategic accounts within the military-aerospace market to expand
into new platforms while maintaining our position on existing
programs. This has resulted in increased sales of product into
these customers both domestically and internationally as we are
well-positioned on key communications, missile and commercial
aircraft platforms. Build rates of commercial aircraft
continue to increase, and our aftermarket and optical products are
gaining traction with aerospace applications outside our
traditional US customer base. Within our distribution
business, sales through our catalog distributors have achieved four
consecutive quarters of year-over-year sales growth. This was
complemented in the third quarter by double-digit growth with our
broadline distribution partners, which we view as a positive trend
for future quarters.
“Bel’s Magnetics Solutions business continues to
be the leader in deployment of next generation 10-gig and other
multi-gig applications. Demand for our integrated connector
modules (ICMs) remained at high levels throughout the third quarter
resulting in a 6% increase over last year’s third quarter.
Improvement in this area was primarily driven by our larger network
infrastructure customers where we enjoyed majority share on key new
product introductions.
“Sales within Bel’s Power Solutions and
Protection business fell short of last year’s third quarter by $6.1
million. This was due in part to the reduced revenue stream
associated with our divested Network Power Solutions (NPS)
business, coupled with lower spend from our traditional networking
and storage customers. The decline was partially offset by
sales growth related to our circuit protection products within
e-Mobility applications, as well as our AC-DC products into
industrial applications in Europe. Other new product
developments within our power group continued to translate into
project wins during the third quarter. One of our power
products is designed in on an Internet of Things (IoT) application
which will be introduced into the consumer marketplace during the
fourth quarter. We also secured and began shipping initial
orders to a large networking company for their datacenter
application. Order volumes for both of these recent wins are
expected to ramp up in early-mid 2018. As mentioned last
quarter, we also have products designed into e-Mobility
applications as well as those supporting the ongoing CORD (Central
Office Rearchitected as a Datacenter) initiative. These
projects should have meaningful contributions to sales in 2018 and
2019. With these projects still in the early stages, we have
evaluated our Power Solutions business from a cost perspective, and
by the end of the third quarter, we had implemented cost savings
measures equating to $1 million in annualized cost savings.
We anticipate these savings to be realized beginning in the first
quarter of 2018,” concluded Mr. Bernstein.
* Sales in our Power Solutions and Protection
group were down year-over-year as sales from our divested NPS
business continue to wind down. The manufacturing services
agreement entered into in 2015 as part of this divestiture is
coming to an end, and we expect it will account for year-over-year
sales declines of $2.9 million in the fourth quarter of 2017, and
approximately $2 million in each of the first and second quarters
of 2018. On an annual basis, total sales related to the NPS
business were $16.1 million in 2016, and are estimated to be $6.0
million in 2017 and less than $1.0 million in 2018. This
product line has had negative margins in 2017, and as such, the
exiting of this arrangement should improve our margins going
forward.
Financial Summary
All comparative percentages are on a
year-over-year basis, unless otherwise noted.
Third Quarter 2017 Results
Net SalesNet sales were $126.4
million, down 1.9% from last year’s third quarter. By geographic
segment, Europe was up by 14.3%, North America was down by 6.0% and
Asia was lower by 2.7%. By product group, Magnetics Solutions
was up by 6.2%, Connectivity Solutions was higher by 2.8% and Power
Solutions and Protection sales were lower by 13.5%. During
the third quarter of 2017, 34% of our sales related to our
Connectivity Solutions products (compared to 32% for the same
period of 2016), 31% related to our Power Solutions and Protection
products (compared to 36% in 2016) and 35% related to our Magnetic
Solutions products (compared to 32% in 2016).
Gross ProfitGross profit margin
improved to 21.9%, up from 20.6% in the third quarter of 2016, and
gross margin dollars were up by $1.0 million in the third quarter
of 2017 on slightly lower sales volume. A favorable shift in
product mix, specifically towards our higher-margin connectivity
products in the areas of military and commercial aerospace,
contributed to margin expansion in the third quarter of 2017. We
also recognized a $0.5 million gain on the sale of our interest in
a joint venture in China which had a favorable impact on our gross
profit during the third quarter of 2017.
Selling, General and Administrative
Expenses (SG&A) SG&A expenses were $20.9 million,
up from $19.4 million in the third quarter of 2016. Factors
contributing to the increase in 2017 related to consulting fees in
connection with the Company’s Enterprise Resource Planning (ERP)
system implementation of $0.4 million, an increase of foreign
exchange losses of $0.4 million and higher legal and professional
fees of $0.6 million.
Operating IncomeOperating income was $6.5
million, compared to $9.3 million in the third quarter of 2016,
with an operating margin of 5.2% in the third quarter of 2017
compared to 7.2% in the third quarter of 2016. In addition to
the items previously noted, operating income for the third quarter
of 2016 also included a pre-tax gain of $2.1 million related to the
sale of a property in Hong Kong.
Income TaxesThe income tax
provision was less than $0.1 million in the third quarter of 2017
as compared with an income tax benefit of $(1.7) million during the
same period of 2016, resulting in an effective tax rate of 1.2%
during the third quarter of 2017, compared to an effective tax rate
of (21.2)% during the same quarter last year. The Company’s income
tax provision can fluctuate significantly based upon the geographic
segment in which the pre-tax profits and losses are earned.
Of the geographic segments in which the Company operates, the U.S.
has the highest tax rates; Europe tax rates are generally lower
than those of the U.S.; and Asia has the lowest tax rates. The
change in effective tax rate was primarily attributable to
increased foreign taxes due to the reversal of valuation allowances
related to net operating loss carryforwards in 2016, as well as an
increase in taxes related to uncertain tax positions.
Net EarningsNet earnings were
$5.0 million in the third quarter of 2017 as compared with $9.7
million in the third quarter of 2016.
Nine months Ended September 30, 2017
Results
Net SalesNet sales were $371.7
million, down $9.9 million, or 2.6%, from the same period last
year. By geographic segment, Europe was up by 1.7%, Asia was up by
0.9% and North America was down by 6.1%. By product group,
Magnetics Solution was up by 5.3%, Power Solutions and Protection
sales were 10.7% lower, and Connectivity Solutions was down by
1.3%. During the nine months ended September 30, 2017, 35% of
our sales related to our Connectivity Solutions products (compared
to 34% for the same period of 2016), 32% related to our Power
Solutions and Protection products (compared to 35% in 2016) and 33%
related to our Magnetic Solutions products (compared to 31% in
2016).
Gross ProfitGross profit margin
was 21.5%, up from 19.7% during the same period of 2016. A
favorable mix of products sold, lower incentive compensation, and
recognition of a $0.5 million gain on the sale of our interest in a
joint venture in China resulted in a favorable impact to gross
profit margin in 2017 as compared with 2016. In addition, the
restructuring efforts taken last year also resulted in reduced
direct labor and fixed overhead costs during the 2017 period.
Selling, General and Administrative
Expenses SG&A expenses increased by $8.9 million
in the nine months ended September 30, 2017 to $63.9 million
compared to $55.0 million in the same period in 2016. During 2016,
Bel recorded a non-recurring benefit of $5.2 million for certain
value-added and business tax items recorded in connection with the
acquisition of Power Solutions. Other factors contributing to the
increase in 2017 related to consulting fees in connection with the
Company’s ERP implementation of $1.5 million, an increase of
foreign exchange losses of $3.0 million and higher legal and
professional fees of $0.8 million.
Goodwill and Other Intangible Assets
ImpairmentDuring the nine months ended September 30, 2016,
we recorded an impairment charge related to our goodwill and other
intangible assets of $106.0 million. This impairment charge did not
impact our cash expenditures, liquidity, financial performance,
compliance with our debt covenants or affect the ongoing
business.
Operating Income
(Loss)Operating income was $15.6 million in the nine
months ended September 30, 2017 as compared with a loss of $(84.1)
million in the same period of 2016, with an operating margin of
4.2% in the nine months ended September 30, 2017 compared to
(22.0)% in the same period of 2016. In addition to the
factors noted above, operating income for the nine month period
ended September 30, 2016 also included a pre-tax gain of $2.1
million related to the sale of a property in Hong Kong.
Income TaxesThe provision for
income taxes was $2.3 million in the nine months ended September
30, 2017 as compared with an income tax benefit of $(20.7) million
during the same period of 2016. The income tax benefit in 2016
included a net benefit related to the resolution of certain
liabilities for uncertain tax positions of $13.0 million and a net
benefit related to the goodwill and other intangible assets
impairment of $4.4 million. In addition, the mix of pre-tax
earnings and losses in different jurisdictions contributed to the
benefit in the nine-month period of 2016. The 2017 period
included $2.3 million in tax expense related to a legal entity
restructuring. These factors resulted in an effective tax rate of
20.8% during the nine months ended September 30, 2017, compared to
an effective tax rate of 23.3% during the same period last
year.
Net Earnings (Loss)Net earnings
was $8.9 million in the nine months ended September 30, 2017 as
compared with a loss of $(68.2) million in the same period of
2016.
Balance Sheet DataAs of September 30, 2017,
working capital was $161.9 million, including $62.1 million of cash
and cash equivalents with a current ratio of 2.7-to-1. In
comparison, as of December 31, 2016, working capital was $163.1
million, including $73.4 million of cash and cash equivalents with
a current ratio of 2.8-to-1. Total debt at September 30, 2017 was
$121.0 million as compared to $141.2 million at December 31,
2016. The decrease in total debt was primarily due to net
repayments of $21.2 million in the nine months ended September 30,
2017.
Conference CallBel has
scheduled a conference call at 11:00 a.m. EDT today. To
participate, dial (888) 259-8544 or (719) 457-2630, conference ID
number: 7129850. A simultaneous webcast of the conference
call may be accessed online from the Events and Presentations link
of the Investors page at www.BelFuse.com. The webcast replay
will be available for a period of 20 days at this same Internet
address. For a telephone replay, dial (844) 512-2921 or (412)
317-6671, conference ID number: 7129850 after 2:00 p.m.
Eastern.
About BelBel (www.belfuse.com)
designs, manufactures and markets a broad array of products that
power, protect and connect electronic circuits. These
products are primarily used in the networking, telecommunications,
computing, military, aerospace, transportation and broadcasting
industries. Bel's product groups include Magnetic Solutions
(integrated connector modules, power transformers, power inductors
and discrete components), Power Solutions and Protection
(front-end, board-mount and industrial power products, module
products and circuit protection), and Connectivity Solutions
(expanded beam fiber optic, copper-based, RF and RJ connectors and
cable assemblies). The Company operates facilities around the
world.
Forward-Looking Statements
Non-historical information contained in this press release (such as
the statements regarding the impact of the growth with broadline
distribution partners, the introduction of an IoT application into
the consumer marketplace, order volumes for certain recent wins,
the contribution of specific products mentioned in this press
release and the impact of the NPS divestiture) are forward-looking
statements (as described under the Private Securities Litigation
Reform Act of 1995) that involve risks and uncertainties. Actual
results could differ materially from Bel's projections. 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
effects of business and economic conditions; difficulties
associated with integrating recently acquired companies; capacity
and supply constraints or difficulties; product development,
commercialization or technological difficulties; the regulatory and
trade environment; 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 impacting our business, 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.
Non-GAAP Financial MeasuresThe
non-GAAP measures identified in this press release as well as in
the supplementary information to this press release (Non-GAAP EPS,
Non-GAAP EBITDA and Non-GAAP Adjusted EBITDA) 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, 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. We present
results adjusted to exclude the effects of certain unusual or
special items and their related tax impact that would otherwise be
included under U.S. GAAP, to aid in comparisons with other
periods. We may use Non-GAAP financial measures to determine
performance-based compensation and management believes that this
information may be useful to investors.
Website InformationWe routinely
post important information for investors on our
website, www.belfuse.com, in the "Investor Relations" section.
We use our website as a means of disclosing material, otherwise
non-public information and for complying with our disclosure
obligations under Regulation FD. Accordingly, investors should
monitor the Investor Relations section of our website, in addition
to following our press releases, SEC filings, public conference
calls, presentations and webcasts. The information contained on, or
that may be accessed through, our website is not incorporated by
reference into, and is not a part of, this document.
[Financial tables follow]
Bel Fuse Inc. |
Supplementary Information(1) |
Condensed Consolidated Statements of
Operations |
(in thousands, except per share
amounts) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
Net
sales |
|
$ |
126,386 |
|
|
$ |
128,809 |
|
|
$ |
371,671 |
|
|
$ |
381,614 |
|
Cost of sales |
|
|
98,769 |
|
|
|
102,234 |
|
|
|
291,729 |
|
|
|
306,273 |
|
Gross
profit |
|
|
27,617 |
|
|
|
26,575 |
|
|
|
79,942 |
|
|
|
75,341 |
|
As a % of net
sales |
|
|
21.9 |
% |
|
|
20.6 |
% |
|
|
21.5 |
% |
|
|
19.7 |
% |
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses |
|
|
20,903 |
|
|
|
19,385 |
|
|
|
63,858 |
|
|
|
55,006 |
|
As a % of net
sales |
|
|
16.5 |
% |
|
|
15.0 |
% |
|
|
17.2 |
% |
|
|
14.4 |
% |
Impairment of goodwill
and other intangible assets(2) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
105,972 |
|
Loss (gain) on disposal
of property, plant and equipment |
|
|
182 |
|
|
|
(2,099 |
) |
|
|
283 |
|
|
|
(2,083 |
) |
Restructuring
charges |
|
|
- |
|
|
|
(20 |
) |
|
|
171 |
|
|
|
581 |
|
|
|
|
|
|
|
|
|
|
Income (loss)
from operations |
|
|
6,532 |
|
|
|
9,309 |
|
|
|
15,630 |
|
|
|
(84,135 |
) |
As a % of net
sales |
|
|
5.2 |
% |
|
|
7.2 |
% |
|
|
4.2 |
% |
|
|
-22.0 |
% |
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(1,466 |
) |
|
|
(1,538 |
) |
|
|
(4,476 |
) |
|
|
(5,243 |
) |
Interest income and
other, net |
|
|
18 |
|
|
|
243 |
|
|
|
65 |
|
|
|
466 |
|
Earnings (loss)
before benefit for income taxes |
|
|
5,084 |
|
|
|
8,014 |
|
|
|
11,219 |
|
|
|
(88,912 |
) |
|
|
|
|
|
|
|
|
|
Provision for (benefit
from) income taxes |
|
|
60 |
|
|
|
(1,696 |
) |
|
|
2,329 |
|
|
|
(20,701 |
) |
Effective tax rate |
|
|
1.2 |
% |
|
|
-21.2 |
% |
|
|
20.8 |
% |
|
|
23.3 |
% |
Net earnings
(loss) available to common stockholders |
|
$ |
5,024 |
|
|
$ |
9,710 |
|
|
$ |
8,890 |
|
|
$ |
(68,211 |
) |
As a % of net
sales |
|
|
4.0 |
% |
|
|
7.5 |
% |
|
|
2.4 |
% |
|
|
-17.9 |
% |
|
|
|
|
|
|
|
|
|
Weighted
average number of shares outstanding: |
|
|
|
|
|
|
|
|
Class A common shares -
basic and diluted |
|
|
2,175 |
|
|
|
2,175 |
|
|
|
2,175 |
|
|
|
2,175 |
|
Class B common shares -
basic and diluted |
|
|
9,864 |
|
|
|
9,760 |
|
|
|
9,856 |
|
|
|
9,730 |
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) per common share: |
|
|
|
|
|
|
|
|
Class A common shares -
basic and diluted |
|
$ |
0.40 |
|
|
$ |
0.78 |
|
|
$ |
0.69 |
|
|
$ |
(5.52 |
) |
Class B common shares -
basic and diluted |
|
$ |
0.42 |
|
|
$ |
0.82 |
|
|
$ |
0.75 |
|
|
$ |
(5.78 |
) |
|
|
|
|
|
|
|
|
|
(1) The
supplementary information included in this press release for 2017
is preliminary and subject to change prior to the filing of our
upcoming Quarterly Report on Form 10-Q with the Securities and
Exchange Commission. Some prior period amounts have been
reclassified to conform to the current year presentation. These
reclassifications, individually and in the aggregate, had no impact
on our consolidated statements of operations. |
|
(2) During
the nine months ended September 30, 2016, we recorded a non-cash
impairment charge of $106.0 million related to our goodwill and
other intangible assets. This impairment did not impact our
cash expenditures, liquidity, financial performance, compliance
with our debt covenants or affect our ongoing business. |
Bel Fuse Inc. |
Supplementary Information(1) |
Condensed Consolidated Balance
Sheets |
(in thousands, unaudited) |
|
|
|
September 30, |
|
December 31, |
|
|
2017 |
|
2016 |
Assets |
|
|
|
|
Current
assets: |
|
|
|
|
Cash and cash
equivalents |
|
$ |
62,106 |
|
$ |
73,411 |
Accounts receivable,
net |
|
|
83,643 |
|
|
74,416 |
Inventories |
|
|
104,522 |
|
|
98,871 |
Other current
assets |
|
|
9,231 |
|
|
8,744 |
Total
current assets |
|
|
259,502 |
|
|
255,442 |
Property, plant and
equipment, net |
|
|
43,664 |
|
|
48,755 |
Goodwill and other
intangible assets, net |
|
|
90,914 |
|
|
92,779 |
Other assets |
|
|
34,408 |
|
|
29,764 |
Total
assets |
|
$ |
428,488 |
|
$ |
426,740 |
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts payable |
|
$ |
45,493 |
|
$ |
47,235 |
Current portion of
long-term debt |
|
|
15,551 |
|
|
11,395 |
Other current
liabilities |
|
|
36,567 |
|
|
33,697 |
Total
current liabilities |
|
|
97,611 |
|
|
92,327 |
Long-term debt |
|
|
105,479 |
|
|
129,850 |
Other liabilities |
|
|
47,303 |
|
|
46,129 |
Total
liabilities |
|
|
250,393 |
|
|
268,306 |
Stockholders'
equity |
|
|
178,095 |
|
|
158,434 |
Total
liabilities and stockholders' equity |
|
$ |
428,488 |
|
$ |
426,740 |
|
|
|
|
|
(1) The supplementary information included in this
press release for 2017 is preliminary and subject to change prior
to the filing of our upcoming Quarterly Report on Form 10-Q
with the Securities and Exchange Commission. |
Bel Fuse Inc. |
Supplementary Information(1) |
Reconciliation of U.S. GAAP Net Earnings
Available to Common Stockholders to Non U.S. GAAP
EBITDA(2) |
(in thousands, unaudited) |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
U.S. GAAP Net
earnings (loss) available to common stockholders |
|
$ |
5,024 |
|
|
$ |
9,710 |
|
|
$ |
8,890 |
|
|
$ |
(68,211 |
) |
Interest expense |
|
|
1,466 |
|
|
|
1,538 |
|
|
|
4,476 |
|
|
|
5,243 |
|
Provision for (benefit
from) income taxes |
|
|
60 |
|
|
|
(1,696 |
) |
|
|
2,329 |
|
|
|
(20,701 |
) |
Depreciation and
amortization |
|
|
5,236 |
|
|
|
5,402 |
|
|
|
15,712 |
|
|
|
16,370 |
|
Non U.S. GAAP
EBITDA |
|
$ |
11,786 |
|
|
$ |
14,954 |
|
|
$ |
31,407 |
|
|
$ |
(67,299 |
) |
% of net sales |
|
|
9.3 |
% |
|
|
11.6 |
% |
|
|
8.5 |
% |
|
|
-17.6 |
% |
|
|
|
|
|
|
|
|
|
Unusual or
special items: |
|
|
|
|
|
|
|
|
ERP
system implementation consulting costs |
|
|
395 |
|
|
|
371 |
|
|
|
1,483 |
|
|
|
371 |
|
Professional fees related to legal entity restructuring |
|
|
- |
|
|
|
- |
|
|
|
200 |
|
|
|
- |
|
Acquisition related costs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
162 |
|
Restructuring charges |
|
|
- |
|
|
|
(20 |
) |
|
|
171 |
|
|
|
581 |
|
Power
Solutions acquisition-related settlements |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(5,155 |
) |
Gain on
sale of Hong Kong property |
|
|
- |
|
|
|
(2,107 |
) |
|
|
- |
|
|
|
(2,107 |
) |
Impairment of goodwill and other intangible assets |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
105,972 |
|
|
|
|
|
|
|
|
|
|
Non U.S. GAAP
Adjusted EBITDA |
|
$ |
12,181 |
|
|
$ |
13,198 |
|
|
$ |
33,261 |
|
|
$ |
32,525 |
|
% of net sales |
|
|
9.6 |
% |
|
|
10.2 |
% |
|
|
8.9 |
% |
|
|
8.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The
supplementary information included in this press release for 2017
is preliminary and subject to change prior to the filing of our
upcoming Quarterly Report on Form 10-Q with the Securities and
Exchange Commission. |
|
(2) In
this press release and supplemental information, we have included
non-U.S. GAAP financial measures, including Non-U.S. GAAP EPS,
EBITDA and Adjusted EBITDA. We present results adjusted to exclude
the effects of certain specified items and their related tax impact
that would otherwise be included under U.S GAAP, to aid in
comparisons with other periods. We may use Non-U.S GAAP
financial measures to determine performance-based compensation and
management believes that this information may be useful to
investors. |
The
following tables detail the impact of certain unusual or special
items had on the Company's net earnings per common Class A and
Class B basic and diluted shares ("EPS") and the line items these
items were included on the condensed consolidated statements of
operations. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
2017 |
|
Three Months Ended September 30,
2016 |
Reconciling Items |
|
Income from operations |
|
Provision for income taxes |
|
Net earnings |
|
Class A EPS |
|
Class B EPS |
|
Income from operations |
|
Benefit from income taxes |
|
Net earnings |
|
Class A EPS |
|
Class B EPS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
measures |
|
$ |
6,532 |
|
$ |
60 |
|
|
$ |
5,024 |
|
$ |
0.40 |
|
$ |
0.42 |
|
$ |
9,309 |
|
|
$ |
(1,696 |
) |
|
$ |
9,710 |
|
|
$ |
0.78 |
|
|
$ |
0.82 |
|
Items included in
SG&A expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ERP
system implementation consulting costs |
|
|
395 |
|
|
130 |
|
|
|
265 |
|
|
0.02 |
|
|
0.02 |
|
|
371 |
|
|
|
96 |
|
|
|
275 |
|
|
|
0.02 |
|
|
|
0.02 |
|
Professional fees related to legal entity restructuring |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Acquisition related costs |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Power
Solutions acquisition related items and settlements |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
Gain on sale of Hong
Kong property |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
(2,107 |
) |
|
|
- |
|
|
|
(2,107 |
) |
|
|
(0.17 |
) |
|
|
(0.18 |
) |
Restructuring
charges |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
(20 |
) |
|
|
(8 |
) |
|
|
(12 |
) |
|
|
- |
|
|
|
- |
|
Impairment of goodwill
and other intangible assets |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
Items included in
income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incremental tax related to legal entity restructuring |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
Power
Solutions acquisition related settlements |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
Non-GAAP
measures |
|
$ |
6,927 |
|
$ |
190 |
|
|
$ |
5,289 |
|
$ |
0.42 |
|
$ |
0.44 |
|
$ |
7,553 |
|
|
$ |
(1,608 |
) |
|
$ |
7,866 |
|
|
$ |
0.63 |
|
|
$ |
0.66 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
2017 |
|
Nine Months Ended September 30,
2016 |
Reconciling Items |
|
Income from operations |
|
Provision for income taxes |
|
Net earnings |
|
Class A EPS |
|
Class B EPS |
|
Income from operations |
|
Benefit from income taxes |
|
Net loss |
|
Class A EPS |
|
Class B EPS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
measures |
|
$ |
15,630 |
|
$ |
2,329 |
|
|
$ |
8,890 |
|
$ |
0.69 |
|
$ |
0.75 |
|
$ |
(84,135 |
) |
|
$ |
(20,701 |
) |
|
$ |
(68,211 |
) |
|
$ |
(5.52 |
) |
|
$ |
(5.78 |
) |
Items included in
SG&A expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ERP
system assessment costs |
|
|
1,483 |
|
|
462 |
|
|
|
1,021 |
|
|
0.08 |
|
|
0.09 |
|
|
371 |
|
|
|
96 |
|
|
|
275 |
|
|
|
0.02 |
|
|
|
0.02 |
|
Professional fees related to legal entity restructuring |
|
|
200 |
|
|
76 |
|
|
|
124 |
|
|
0.01 |
|
|
0.01 |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Acquisition related costs |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
162 |
|
|
|
61 |
|
|
|
101 |
|
|
|
0.01 |
|
|
|
0.01 |
|
Power
Solutions acquisition related items and settlements |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
(5,155 |
) |
|
|
(780 |
) |
|
|
(4,375 |
) |
|
|
(0.35 |
) |
|
|
(0.37 |
) |
Gain on sale of Hong
Kong property |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
(2,107 |
) |
|
|
- |
|
|
|
(2,107 |
) |
|
|
(0.17 |
) |
|
|
(0.18 |
) |
Restructuring
charges |
|
|
171 |
|
|
44 |
|
|
|
127 |
|
|
0.01 |
|
|
0.01 |
|
|
581 |
|
|
|
212 |
|
|
|
369 |
|
|
|
0.03 |
|
|
|
0.03 |
|
Impairment of goodwill
and other intangible assets |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
105,972 |
|
|
|
4,385 |
|
|
|
101,587 |
|
|
|
8.20 |
|
|
|
8.61 |
|
Items included in
income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incremental tax related to legal entity restructuring |
|
|
- |
|
|
(2,308 |
) |
|
|
2,308 |
|
|
0.18 |
|
|
0.19 |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Power
Solutions acquisition related settlements |
|
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
13,809 |
|
|
|
(13,809 |
) |
|
|
(1.11 |
) |
|
|
(1.17 |
) |
Non-GAAP
measures |
|
$ |
17,484 |
|
$ |
603 |
|
|
$ |
12,470 |
|
$ |
0.97 |
|
$ |
1.05 |
|
$ |
15,689 |
|
|
$ |
(2,918 |
) |
|
$ |
13,830 |
|
|
$ |
1.11 |
|
|
$ |
1.17 |
|
|
|
Investor
Contact:Darrow Associatestel
516.419.9915pseltzberg@darrowir.com |
Company Contact:Daniel Bernstein
President ir@belf.com |
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