Attached files
file | filename |
---|---|
8-K - FORM 8-K - MOLEX INC | c62655e8vk.htm |
EX-99.2 - EX-99.2 - MOLEX INC | c62655exv99w2.htm |
EXHIBIT 99.1
Contact: Steve Martens
Vice President of Investor Relations
(630) 527-4344
Vice President of Investor Relations
(630) 527-4344
MOLEX REPORTS RECORD REVENUE AND EARNINGS PER SHARE
Lisle, Ill., USA January 25, 2011 Molex Incorporated (NASDAQ: MOLX and MOLXA), a global
electronic components company, today reported results for its fiscal 2011 second quarter ended
December 31, 2010.
Three Months Ended | ||||||||||||
Dec. 31, | Sept. 30, | Dec. 31, | ||||||||||
USD millions, except per share data | 2010 | 2010 | 2009 | |||||||||
Net revenue |
$ | 901.5 | $ | 897.7 | $ | 729.6 | ||||||
Net income |
78.3 | 75.1 | 13.8 | |||||||||
Earnings per share |
0.45 | 0.43 | 0.08 |
Revenue for the December 2010 quarter of $901.5 million exceeded the high end of the guidance
provided on October 26, 2010, increased 24% from the December 2009 quarter and was incrementally
higher than the September 2010 quarter. Revenue in local currencies increased 22% compared with
the prior year but decreased 2% compared with the September 2010 quarter. Orders for the quarter
were $872 million, an increase of 12% from the prior year quarter and in line with the September
2010 quarter.
Net income for the December 2010 quarter was $78.3 million or $0.45 per share, exceeding the high
end of guidance, compared with net income of $13.8 million, or $0.08 per share, for the December
2009 quarter and $75.1 million, or $0.43 per share, for the September 2010 quarter. Net income for
the current quarter was impacted by legal costs related to unauthorized activities in Japan of $2.7
million ($1.7 million after-tax or $0.01 per share). In the December 2009 quarter, net income
included restructuring costs of $25.6 million ($22.2 million after-tax or $0.13 per share) and
costs from unauthorized activities in Japan of $8.5 million ($5.4 million after-tax or $0.03 per
share). In the September 2010 quarter, net income included legal costs related to unauthorized
activities in Japan of $5.5 million ($3.5 million after-tax or $0.02 per share). The effective tax
rate for the current quarter was 30.3%.
Fiscal 2011 is off to a strong start with successive quarters of revenue and earnings per share
records, commented Martin P. Slark, Molexs Chief Executive Officer. We expect our expanded and
more diversified customer base, coupled with our robust new product pipeline, to position us for a
strong second half to our fiscal year. In addition to these organic growth opportunities, in
January we announced the purchase of Luxteras active optical cable business which will give us a
more complete offering in our high speed cable business and offer us considerable growth potential
both now and for next generation technology. With our new, low cost platform, a strong balance
sheet, our extensive presence in Asia and significant growth opportunities in the expanding global
electronics market, we believe we are well positioned for the future.
Other financial highlights for the quarter ended December 31, 2010:
| Gross profit margin was 30.1% in the December 2010 quarter, compared with 29.1% in the December 2009 quarter and 30.6% in the September 2010 quarter. | ||
| SG&A expense was $159.0 million, or 17.6% of revenue compared with 20.6% in the December 2009 quarter and 17.5% in the September 2010 quarter. | ||
| Capital expenditures were $61.5 million or 6.8% of revenue. | ||
| Depreciation and Amortization was $61.7 million or 6.8% of revenue. | ||
| Backlog was $413.7 million, a decrease of $31.8 million or 7.1% from the September 2010 quarter. The book-to-bill ratio was 0.97 for the December 2010 quarter. |
Unauthorized Activities in Japan
As previously disclosed, in April 2010 Molex launched an investigation into unauthorized activities
in its Japanese subsidiary after it was learned that an individual had obtained unauthorized loans
and entered into unauthorized trading in Molex Japans name. The Company retained outside legal
counsel and they retained forensic accountants to investigate the matter and that investigation has
now been completed. 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 intends to
vigorously contest the enforceability of the outstanding unauthorized loans and any attempt by the
lender to obtain payment.
Outlook
The Company has considered the seasonal trends and the continued uncertainty in the global
electronics market in setting its guidance for the coming quarter. In consideration of these
factors and assuming constant foreign currency rates and commodity prices, the Company estimates
revenue in a range of $850 to $890 million for the March 2011 quarter. At this level of revenue,
the Company expects earnings per share in a range of $0.39 to $0.43 assuming an effective tax rate
of 30%.
Earnings Conference Call Information
A conference call will be held on Tuesday, January 25, 2011 at 4:00 pm central time. Please dial
(888) 680-0878 to participate in the call. International callers should dial (617) 213-4855.
Please dial in at least five minutes prior to the start of the call and refer to participant pass
code 90919051. Internet users will be able to access the webcast, including slide materials, live
and in replay in the Investors section of the Companys website at www.molex.com. A 48-hour
telephone replay will be available at approximately 6:00 pm central time at (888) 286-8010 or (617)
801-6888 / pass code 81610425.
Other Investor Events
February 16, 2011 / Goldman Sachs Technology and Internet Conference 2011 / San Francisco
March 3, 2011 / Morgan Stanley Technology, Media and Telecom Conference / San Francisco
March 3, 2011 / Morgan Stanley Technology, Media and Telecom Conference / San Francisco
2
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 Companys actions or the demand for the Companys 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; 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 Companys
Form 10-K for the year ended June 30, 2010, and for the Form 10-Q for the quarter ended September
30, 2010, 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.
# # #
Editors note: Molex is traded on the NASDAQ Global Select Market (MOLX and MOLXA) in the United
States and on the London Stock Exchange. The Companys voting common stock (MOLX) is included in
the S&P 500 Index.
3
Molex Incorporated
Condensed Consolidated Balance Sheets
(in thousands)
Condensed Consolidated Balance Sheets
(in thousands)
Dec. 31, | June 30, | |||||||
2010 | 2010 | |||||||
(unaudited) | ||||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 392,390 | $ | 376,352 | ||||
Marketable securities |
18,239 | 18,508 | ||||||
Accounts receivable, less allowances of $50,390 and $43,650 respectively |
759,814 | 734,932 | ||||||
Inventories |
559,637 | 469,369 | ||||||
Deferred income taxes |
114,944 | 112,531 | ||||||
Other current assets |
55,713 | 64,129 | ||||||
Total current assets |
1,900,737 | 1,775,821 | ||||||
Property, plant and equipment, net |
1,129,141 | 1,055,144 | ||||||
Goodwill |
134,218 | 131,910 | ||||||
Non-current deferred income taxes |
85,222 | 94,191 | ||||||
Other assets |
180,731 | 179,512 | ||||||
Total assets |
$ | 3,430,049 | $ | 3,236,578 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||
Current liabilities: |
||||||||
Current portion of long-term debt and short-term borrowings |
$ | 107,668 | $ | 110,070 | ||||
Accounts payable |
377,592 | 395,474 | ||||||
Accrued expenses: |
||||||||
Accrual for unauthorized activities in Japan |
180,074 | 165,815 | ||||||
Income taxes payable |
18,842 | 21,505 | ||||||
Other |
207,267 | 219,832 | ||||||
Total current liabilities |
891,443 | 912,696 | ||||||
Other non-current liabilities |
19,103 | 19,869 | ||||||
Accrued pension and postretirement benefits |
129,420 | 135,448 | ||||||
Long-term debt |
198,639 | 183,434 | ||||||
Total liabilities |
1,238,605 | 1,251,447 | ||||||
Commitments and contingencies |
||||||||
Total stockholders equity |
2,191,444 | 1,985,131 | ||||||
Total liabilities and stockholders equity |
$ | 3,430,049 | $ | 3,236,578 | ||||
4
Molex Incorporated
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Net revenue |
$ | 901,465 | $ | 729,576 | $ | 1,799,137 | $ | 1,403,609 | ||||||||
Cost of sales |
630,420 | 517,040 | 1,253,016 | 999,654 | ||||||||||||
Gross profit |
271,045 | 212,536 | 546,121 | 403,955 | ||||||||||||
Selling, general and administrative |
159,044 | 150,105 | 316,100 | 295,734 | ||||||||||||
Restructuring costs and asset impairments |
| 25,635 | | 81,528 | ||||||||||||
Unauthorized activities in Japan |
2,713 | 8,543 | 8,255 | 14,097 | ||||||||||||
Total operating expenses |
161,757 | 184,283 | 324,355 | 391,359 | ||||||||||||
Income from operations |
109,288 | 28,253 | 221,766 | 12,596 | ||||||||||||
Interest (expense) income, net |
(1,788 | ) | (1,286 | ) | (3,123 | ) | (2,286 | ) | ||||||||
Other income (expense) |
4,792 | (701 | ) | 4,441 | 2,783 | |||||||||||
Total other income (expense) |
3,004 | (1,987 | ) | 1,318 | 497 | |||||||||||
Income before income taxes |
112,292 | 26,266 | 223,084 | 13,093 | ||||||||||||
Income taxes |
34,009 | 12,426 | 69,697 | 14,389 | ||||||||||||
Net income (loss) |
$ | 78,283 | $ | 13,840 | $ | 153,387 | $ | (1,296 | ) | |||||||
Earnings (loss) per share: |
||||||||||||||||
Basic |
$ | 0.45 | $ | 0.08 | $ | 0.88 | $ | (0.01 | ) | |||||||
Diluted |
$ | 0.45 | $ | 0.08 | $ | 0.88 | $ | (0.01 | ) | |||||||
Dividends declared per share |
$ | 0.1750 | $ | 0.1525 | $ | 0.3275 | $ | 0.3050 | ||||||||
Average common shares outstanding: |
||||||||||||||||
Basic |
174,664 | 173,743 | 174,510 | 173,605 | ||||||||||||
Diluted |
175,556 | 174,575 | 175,329 | 173,605 |
5
Molex Incorporated
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Six Months Ended | ||||||||
December 31, | ||||||||
2010 | 2009 | |||||||
Operating activities: |
||||||||
Net income (loss) |
$ | 153,387 | $ | (1,296 | ) | |||
Add non-cash items included in net income (loss): |
||||||||
Depreciation and amortization |
120,804 | 121,263 | ||||||
Share-based compensation |
11,460 | 15,127 | ||||||
Non-cash restructuring and other costs, net |
| 19,922 | ||||||
Other non-cash items |
7,275 | 27,428 | ||||||
Changes in assets and liabilities: |
||||||||
Accounts receivable |
3,221 | (58,715 | ) | |||||
Inventories |
(67,631 | ) | (18,589 | ) | ||||
Accounts payable |
(36,945 | ) | 9,128 | |||||
Other current assets and liabilities |
(11,280 | ) | 14,687 | |||||
Other assets and liabilities |
2,184 | 12,883 | ||||||
Cash provided from operating activities |
182,475 | 141,838 | ||||||
Investing activities: |
||||||||
Capital expenditures |
(132,728 | ) | (93,320 | ) | ||||
Proceeds from sales of property, plant and equipment |
1,400 | 6,554 | ||||||
Proceeds from sales or maturities of marketable securities |
5,203 | 35,319 | ||||||
Purchases of marketable securities |
(3,612 | ) | (1,485 | ) | ||||
Acquisitions |
| (10,090 | ) | |||||
Other investing activities |
| 222 | ||||||
Cash used for investing activities |
(129,737 | ) | (62,800 | ) | ||||
Financing activities: |
||||||||
Proceeds from revolving credit facility and short-term loans |
50,000 | 110,000 | ||||||
Payments on revolving credit facility |
(15,000 | ) | (70,000 | ) | ||||
Payments of short-term and long-term debt |
(36,051 | ) | (15,336 | ) | ||||
Cash dividends paid |
(53,186 | ) | (52,919 | ) | ||||
Exercise of stock options |
1,820 | 991 | ||||||
Other financing activities |
(1,954 | ) | (1,183 | ) | ||||
Cash used for financing activities |
(54,371 | ) | (28,447 | ) | ||||
Effect of exchange rate changes on cash |
17,671 | 11,020 | ||||||
Net increase in cash and cash equivalents |
16,038 | 61,611 | ||||||
Cash and cash equivalents, beginning of period |
376,352 | 424,707 | ||||||
Cash and cash equivalents, end of period |
$ | 392,390 | $ | 486,318 | ||||
6