TIDMMOL
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Molex Incorporated (NASDAQ: MOLX and MOLXA), a global electronic
components company, today reported results for its fourth quarter
and its full fiscal year ended June 30, 2011.
Full Year Results
Twelve Months Ended
Jun. 30, Jun. 30,
USD millions, except per share data 2011 2010
Net revenue $ 3,587.3 $ 3,007.2
Net income 298.8 76.9
Earnings per share 1.70 0.44
Revenue for the full fiscal year ended June 30, 2011 was $3.6
billion, an increase of 19.3% compared with the prior fiscal year.
Revenue in local currencies increased 16.5%. Net income for the
full fiscal year ended June 30, 2011 was $298.8 million or $1.70
per share, compared with net income of $76.9 million or $0.44 per
share in the prior fiscal year. Prior year net income included a
pretax restructuring charge of $117.1 million ($92.8 million
after-tax or $0.53 per share), and a tax adjustment related to
stock compensation of $4.8 million or $0.03 per share. These
periods also include costs related to unauthorized activities in
Japan as outlined below in our update on this matter. The effective
tax rate for the fiscal year ended June 30, 2011 was 30.5%.
"Looking back, we are very pleased with our performance both for
the current quarter and for the full year. We set annual records
for revenue and profitability in a very difficult operating
environment. Surging commodity costs, rapid increases in customer
requirements and the natural disaster in Japan presented
significant obstacles which we were able to overcome," commented
Martin P. Slark, Molex's Chief Executive Officer. "As a result, we
were able to increase our dividend twice during the fiscal
year."
"Looking forward, the long term factors driving our business -
increased mobility for consumer electronics, renewed enterprise
spending, and a growing middle class in emerging economies - remain
intact providing ample opportunities for growth. And, we have the
right structure and people in place to take advantage of these
opportunities and further grow both revenue and profit."
Fourth Quarter Results
Three Months Ended
Jun. 30, Mar. 31, Jun. 30,
USD millions, except per share data 2011 2011 2010
Net revenue $ 913.7 $ 874.5 $ 847.3
Net income 77.3 68.1 39.8
Earnings per share 0.44 0.39 0.23
Revenue for the June 2011 quarter of $913.7 million increased
7.8% from the June 2010 quarter and 4.5% from the March 2011
quarter. Revenue in local currencies increased 2.5% compared with
the prior year quarter and 2.9% compared with the March 2011
quarter. Orders for the quarter were $906 million, a slight
decrease from the prior year quarter and an increase of 2.9% from
the March 2011 quarter.
Net income for the June 2011 quarter was $77.3 million or $0.44
per share, compared with net income of $39.8 million, or $0.23 per
share, for the June 2010 quarter and $68.1 million, or $0.39 per
share, for the March 2011 quarter. All periods include costs
related to unauthorized activities in Japan as outlined below in
our update on this matter. The June 2010 quarter also included
pretax restructuring costs of $26.5 million ($24.7 million
after-tax or $0.14 per share).
Other financial highlights for the quarter ended June 30,
2011:
-- Gross profit margin was 30.8% in the June 2011 quarter, compared with
29.9% in the June 2010 quarter and 29.8% in the March 2011
quarter.
-- SG&A expense was $167.9 million, or 18.4% of revenue compared with
18.7% in the June 2010 quarter and 18.2% in the March 2011
quarter.
-- The effective tax rate was 29.1%.
-- Capital expenditures were $65.3 million or 7.2% of revenue.
-- Depreciation and amortization was $60.5 million or 6.6% of revenue.
-- Backlog was $418.5 million, a decrease of $6.9 million or 1.6% from
the March 2011 quarter.
-- The book-to-bill ratio was 0.99 to 1 for the June 2011 quarter.
-- Inventory days outstanding was 84 days, a decrease of 3 days from the
March quarter.
Molex Japan Litigation
As previously disclosed, in April 2010 Molex learned that an
individual had entered into unauthorized trading and obtained
unauthorized loans in Molex Japan's name. On August 31, 2010, the
bank which holds the unauthorized loans filed a complaint in Tokyo
District Court requesting payment from Molex Japan. Molex Japan is
contesting the enforceability of the outstanding unauthorized loans
and any attempt by the lender to obtain payment.
Net income for the June 2011, March 2011 and June 2010 quarters
was impacted by costs related to the unauthorized activities in
Japan of $3.4 million ($2.1 million after-tax or $0.01 per share),
$2.9 million ($1.8 million after-tax or $0.01 per share), and $4.8
million ($3.0 million after-tax or $0.02 per share),
respectively.
Net income for the full fiscal years ended June 30, 2011 and
June 30, 2010 included costs related to this matter of $14.5
million ($9.2 million after-tax or $0.05 per share) and $26.9
million ($17.1 million after-tax or $0.10 per share),
respectively.
Outlook
Assuming constant foreign currency rates and commodity prices,
the Company estimates revenue in a range of $880 to $920 million
for the September 2011 quarter. At this level of revenue, the
Company expects earnings per share in a range of $0.39 to $0.45
assuming an effective tax rate of 30%.
Earnings Conference Call Information
A conference call will be held on Wednesday, August 3, 2011 at
7:30 am central time. Please dial (888) 713-4216 to participate in
the call. International callers should dial (617) 213-4868. Please
dial in at least five minutes prior to the start of the call and
refer to participant pass code 67985835. 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 10:30am central time at (888) 286-8010 or (617)
801-6888 / pass code 20610238.
Other Investor Events
Aug 18, 2011 - WJB Capital Group's Midwest Industrial Conference
in Lake Geneva, WI
Sep 6-7, 2011 - Citi Tech Conference in New York, NY
Sep 14, 2011 - Deutsche Bank Securities' 2011 Technology
Conference in Las Vegas, NV
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 "anticipates," "expects," "believes,"
"intends," "plans," "projects," "estimates," "potential," 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 are subject to risks, uncertainties and assumptions
including those associated with the operation of our business,
including the risk that customer demand will decrease either
temporarily or permanently, whether due to the Company's actions or
the demand for the Company's products, and that the Company may not
be able to respond through cost reductions in a timely and
effective manner; the risk that the value of our inventory may
decline; price cutting, new product introductions and other actions
by our competitors; fluctuations in the costs of raw materials that
the Company is not able to pass through to customers because of
existing contracts or market factors; the availability of credit
and general market liquidity; fluctuations in currency exchange
rates; natural disasters; the financial condition of our customers;
labor cost increases; the challenges attendant to plant closings
and restructurings, the difficulty of commencing or increasing
production at existing facilities, and the reactions of customers,
governmental units, employees and other groups; and the ability to
realize cost savings from restructuring activities, the outcome of
legal proceedings and losses resulting from unauthorized activities
in Molex Japan.
Other factors, risks and uncertainties are set forth in Item 1A
"Risk Factors" of the Company's Form 10-K for the year ended June
30, 2010, and in the Form 10-Q for the quarters ended September 30,
2010, December 31, 2010 and March 31, 2011, which are incorporated
by reference and in other reports that Molex files or furnishes
with the Securities and Exchange Commission.Forward-looking
statements are based upon assumptions as to future events that may
not prove to be accurate.Actual outcomes and results may differ
materially from what is expressed in these forward-looking
statements.As a result, this release speaks only as of its date and
Molex disclaims any obligation to revise these forward-looking
statements or to provide any updates regarding information
contained in this release resulting from new information, future
events or otherwise.
Molex Incorporated is a 72-year-old global manufacturer of
electronic, electrical and fiber optic interconnection systems.
Based in Lisle, Illinois, USA, the Company operates 39
manufacturing locations in 16 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)
June 30, June 30,
2011 2010
ASSETS
Current assets:
Cash and cash equivalents $ 532,599 $ 376,352
Marketable securities 13,947 18,508
Accounts receivable, less allowances of 811,449 734,932
$42,297 and $43,650, respectively
Inventories 535,953 469,369
Deferred income taxes 129,158 112,531
Other current assets 32,239 64,129
Total current assets 2,055,345 1,775,821
Property, plant and equipment, net 1,168,448 1,055,144
Goodwill 149,452 131,910
Non-current deferred income taxes 38,178 94,191
Other assets 186,429 179,512
Total assets $ 3,597,852 $ 3,236,578
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 119,764 $ 110,070
and short-term borrowings
Accounts payable 359,812 395,474
Accrued expenses:
Salaries, commissions and bonuses 90,913 96,403
Restructuring 14,049 26,898
Accrual for unauthorized activities in Japan 182,460 165,815
Other 112,666 96,531
Income taxes payable 2,383 21,505
Total current liabilities 882,047 912,696
Other non-current liabilities 23,879 19,869
Accrued pension and postretirement benefits 100,866 135,448
Long-term debt 222,794 183,434
Total liabilities 1,229,586 1,251,447
Commitments and contingencies
Total stockholders' equity 2,368,266 1,985,131
Total liabilities and stockholders' equity $ 3,597,852 $ 3,236,578
Molex
Incorporated
Condensed
Consolidated
Statements
of Operations
(in thousands,
except
per share
data)
(quarterly
information
unaudited)
Three Months Ended Years Ended
June 30, June 30,
2011 2010 2011 2010
Net revenue $ 913,666 $ 847,304 $ 3,587,334 $ 3,007,207
Cost of sales 632,264 594,366 2,499,197 2,114,584
Gross profit 281,402 252,938 1,088,137 892,623
Selling, 167,914 158,676 643,462 610,784
general
and
administrative
Restructuring - 26,543 - 117,139
costs and
asset
impairments
Unauthorized 3,366 4,769 14,476 26,898
activities
in Japan
Total 171,280 189,988 657,938 754,821
operating
expenses
Income from 110,122 62,950 430,199 137,802
operations
Interest (859 ) (832 ) (5,708 ) (5,416 )
(expense)
income, net
Other (318 ) (959 ) 5,448 (897 )
(expense)
income
Total other (1,177 ) (1,791 ) (260 ) (6,313 )
(expense)
income
Income before 108,945 61,159 429,939 131,489
income taxes
Income taxes 31,669 21,380 131,131 54,559
Net income $ 77,276 $ 39,779 $ 298,808 $ 76,930
Earnings per
share:
Basic $ 0.44 $ 0.23 $ 1.71 $ 0.44
Diluted $ 0.44 $ 0.23 $ 1.70 $ 0.44
Dividends $ 0.2000 $ 0.1525 $ 0.7025 $ 0.6100
declared
per share
Average common
shares
outstanding:
Basic 175,253 174,123 174,812 173,803
Diluted 176,795 175,098 175,943 174,660
Molex Incorporated
Condensed Consolidated Statements of Cash Flows
(in thousands)
Years Ended
June 30,
2011 2010
Operating activities:
Net income $ 298,808 $ 76,930
Add (deduct) non-cash items
included in net income:
Depreciation and amortization 242,171 238,666
Asset write-downs included - 37,296
in restructuring costs
Loss (gain) on investments - 558
Deferred income taxes 37,514 (16,965 )
Loss on sale of property, plant and equipment 4,843 4,092
Share-based compensation 22,461 27,034
Other non-cash items (22,554 ) 20,577
Changes in assets and liabilities:
Accounts receivable (16,401 ) (208,051 )
Inventories (25,916 ) (117,701 )
Accounts payable (63,984 ) 115,869
Other current assets and liabilities (9,298 ) 14,559
Other assets and liabilities (1,493 ) 57,715
Cash provided from operating activities 466,151 250,579
Investing activities:
Capital expenditures (262,246 ) (229,477 )
Proceeds from sales of property, 1,804 3,014
plant and equipment
Proceeds from sales or maturities 11,936 44,373
of marketable securities
Purchases of marketable securities (8,328 ) (18,890 )
Acquisitions (18,847 ) (10,097 )
Other investing activities 4,972 (5,794 )
Cash used for investing activities (270,709 ) (216,871 )
Financing activities:
Proceeds from revolving credit facility 105,000 154,000
Payments on revolving credit facility (20,000 ) (79,000 )
Proceeds from short-term loans 57,620 -
Payments on short-term loans (60,270 ) -
Proceeds from issuance of long-term debt - 32,647
Payments on long-term debt (48,356 ) (87,787 )
Cash dividends paid (114,410 ) (105,984 )
Exercise of stock options 7,269 4,008
Other financing activities (4,044 ) (1,120 )
Cash used for financing activities (77,191 ) (83,236 )
Effect of exchange rate changes on cash 37,996 1,173
Net increase (decrease) in 156,247 (48,355 )
cash and cash equivalents
Cash and cash equivalents, beginning of year 376,352 424,707
Cash and cash equivalents, end of year $ 532,599 $ 376,352
Molex Incorporated
Steve Martens, VP Investor Relations
630-527-4344
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