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Molex Incorporated (NASDAQ: MOLX) and (NASDAQ: MOLXA), a global
electronic components company, today reported results for its
second quarter ended December 31, 2012.
Three Months Ended
Dec 31, Sept 30, Dec 31,
USD millions, except per share data 2012 2012 2011
Net revenue $ 967.7 $ 916.9 $ 857.6
Net income 70.4 71.3 64.0
Earnings per share 0.39 0.40 0.36
Net revenue for the December 2012 quarter was $967.7 million, an
increase of 5.5% from the September 2012 quarter and 12.8% from the
December 2011 quarter. In local currencies, net revenue increased
4.8% compared with the September 2012 quarter and 13.8% compared
with the December 2011 quarter. Orders for the December 2012
quarter were $919.7 million, a decline of 2.6% from the September
2012 quarter and an increase of 12.8% from the December 2011
quarter.
Net income for the December 2012 quarter was $70.4 million or
$0.39 per share, compared with $71.3 million, or $0.40 per share,
for the September 2012 quarter and $64.0 million, or $0.36 per
share, for the December 2011 quarter.
"Our results came in at the high end of our guidance range and
we were particularly pleased to achieve record revenue this quarter
as shipments were strong leading into the Christmas period.
Bookings were weaker toward the latter part of the quarter and
consistent with normal seasonal trends, were down 2.6% on a
sequential basis. Our pipeline of new projects is strong and we
will have a clearer view of the business trends for calendar year
2013 after Chinese New Year," stated Martin P. Slark, Chief
Executive Officer.
Other financial highlights for the quarter ended December 31,
2012:
-- Gross profit margin was 29.9%, compared with 29.3% in the September
2012 quarter and 30.7% in the December 2011 quarter.
-- SG&A expense was $181.0 million, compared with $163.1 million in the
September 2012 quarter and $163.1 million in the December
2011
quarter. The September 2012 quarter included insurance proceeds
of
$9.9 million related to losses incurred from the March 2011
earthquake
and tsunami in Japan.
-- Backlog was $404.0 million, a decrease of 9.3% from the September 2012
quarter and an increase of 16.7% from the December 2011
quarter.
-- The book-to-bill ratio for the December quarter was 0.95 to 1 compared
with 1.03 to 1 for the September quarter and 0.95 to 1 for
the
December 2011 quarter.
-- Capital expenditures were $78.6 million or 8.1% of revenue.
-- Inventory days outstanding was 83 days compared with 84 days in the
September 2012 quarter and 91 days in the December 2011
quarter.
-- Accounts receivable days outstanding was 67 days compared with 69 days
in the September 2012 quarter and 71 days in the December 2011
quarter.
-- The effective tax rate was 31.1%.
Outlook
Based upon current order rates and customer backlog, the Company
estimates revenue in the range of $900 to $930 million for the
March 2013 quarter. At this level of revenue, the Company expects
earnings per share in the range of $0.33 to $0.37, assuming
constant foreign currency rates, unchanged commodity prices and an
effective tax rate in the range of 30% to 32%.
Earnings Conference Call Information
A conference call will be held on Wednesday, January 23, 2013 at
8:30 a.m. central time. Please dial (888) 679-8035 to participate
in the call. International callers should dial (617) 213-4848.
Please dial in at least five minutes prior to the start of the call
and refer to participant pass code 88944879. 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 10:30 a.m. central time at (888) 286-8010 or (617)
801-6888 / pass code 81162241.
Other Investor Events
Feb 12 - Goldman Sachs Technology and Internet Conference in San
Francisco, CA
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 "expect," "anticipate," "outlook," "forecast,"
"could," "project," "intend," "plan," "continue," "believe,"
"seek," "estimate," "should," "may," "assume," "potential,"
variations of such words 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 involve
certain risks, uncertainties and assumptions that are difficult to
predict. Respective risks, uncertainties, and assumptions that
could affect the outcome or results of operations are described in
Part 1, Item 1A of our Annual Report on Form 10-K for the year
ended June 30, 2012, and the Form 10-Q for the quarter ended
September 30, 2012, which is incorporated by reference and in other
reports that Molex files or furnishes with the Securities and
Exchange Commission.
We have based our forward-looking statements on our management's
beliefs and assumptions based on information available to
management at the time the statements are made. We caution you that
actual outcomes and results may differ materially from what is
expressed, implied, or forecast by our forward-looking statements.
Reference is made in particular to forward-looking statements
regarding growth strategies, industry trends, global economic
conditions, success of customers, cost of raw materials, value of
inventory, availability of credit, foreign currency exchange rates,
labor costs, protection of intellectual property, cost reduction
initiatives, acquisition synergies, manufacturing strategies,
product development introduction and sales, regulatory changes,
competitive strengths, income tax fluctuations, natural disasters,
unauthorized access to data, government investigations and outcomes
of legal proceedings. Except as required under the federal
securities laws, we do not have any intention or obligation to
update publicly any forward-looking statements after the
distribution of this report, whether as a result of new
information, future events, changes in assumptions, or
otherwise.
Molex Incorporated is a 74-year-old global manufacturer of
electronic, electrical and fiber optic interconnection systems.
Based in Lisle, Illinois, USA, the Company operates 41
manufacturing locations in 15 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)
Dec. 31, June 30,
2012 2012
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 705,047 $ 637,417
Marketable securities 11,738 14,830
Accounts receivable, less allowances of 745,851 751,279
$37,681 and $37,876, respectively
Inventories 566,889 531,825
Deferred income taxes 101,398 110,789
Other current assets 33,109 33,098
Total current assets 2,164,032 2,079,238
Property, plant and equipment, net 1,177,342 1,150,549
Goodwill 195,030 160,986
Non-current deferred income taxes 48,063 50,038
Other assets 180,130 170,692
Total assets $ 3,764,597 $ 3,611,503
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of short-term borrowings $ 115,869 $ 104,933
and long-term debt
Accounts payable 344,997 355,491
Accrued expenses:
Accrued liability for unauthorized 170,665 184,177
activities in Japan
Income taxes payable 40,876 35,360
Other 200,084 212,035
Total current liabilities 872,491 891,996
Other non-current liabilities 19,700 18,174
Accrued pension and other 95,424 115,176
postretirement benefits
Long-term debt 230,000 150,032
Total liabilities 1,217,615 1,175,378
Commitments and contingencies
Total stockholders' equity 2,546,982 2,436,125
Total liabilities and stockholders' equity $ 3,764,597 $ 3,611,503
Molex
Incorporated
Condensed
Consolidated
Statements
of Income
(Unaudited)
(in thousands,
except
per share
data)
Three Months Ended Six Months Ended
December 31, December 31,
2012 2011 2012 2011
Net revenue $ 967,735 $ 857,598 $ 1,884,656 $ 1,793,583
Cost of sales 678,565 594,661 1,327,069 1,237,918
Gross profit 289,170 262,937 557,587 555,665
Selling, 181,028 163,073 344,149 332,298
general
and
administrative
Unauthorized 1,627 2,723 4,188 5,645
activities
in Japan
Total 182,655 165,796 348,337 337,943
operating
expenses
Income from 106,515 97,141 209,250 217,722
operations
Interest (1,133 ) (2,094 ) (1,943 ) (3,485 )
(expense)
income, net
Other (3,151 ) 1,482 (1,955 ) 1,758
(expense)
income
Total other (4,284 ) (612 ) (3,898 ) (1,727 )
(expense)
income, net
Income before 102,231 96,529 205,352 215,995
income taxes
Income taxes 31,837 32,513 63,644 71,462
Net income $ 70,394 $ 64,016 $ 141,708 $ 144,533
Earnings per
share:
Basic $ 0.40 $ 0.36 $ 0.80 $ 0.82
Diluted $ 0.39 $ 0.36 $ 0.79 $ 0.82
Dividends $ 0.2200 $ 0.2000 $ 0.4400 $ 0.4000
declared
per share
Average common
shares
outstanding:
Basic 177,123 175,830 176,888 175,656
Diluted 178,854 176,985 178,743 176,778
Molex Incorporated
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
Six Months Ended
December 31,
2012 2011
Operating activities:
Net income $ 141,708 $ 144,533
Add non-cash items included in net income:
Depreciation and amortization 117,402 121,174
Share-based compensation 15,425 11,402
Other non-cash items 5,685 5,213
Changes in assets and liabilities:
Accounts receivable 5,006 94,400
Inventories (34,831 ) (26,442 )
Accounts payable (5,326 ) (40,976 )
Other current assets and liabilities 9,605 (7,183 )
Other assets and liabilities (97 ) (10,608 )
Cash provided from operating activities 254,577 291,513
Investing activities:
Capital expenditures (148,041 ) (95,055 )
Acquisitions (55,299 ) (24,000 )
Proceeds from sales of property, 3,020 2,202
plant and equipment
Proceeds from sales or maturities 8,399 6,553
of marketable securities
Purchases of marketable securities (5,081 ) (4,787 )
Insurance proceeds and other 9,957 -
investing activities
Cash used for investing activities (187,045 ) (115,087 )
Financing activities:
Proceeds from revolving credit facility 90,000 75,000
Payments on revolving credit facility (10,000 ) (220,000 )
Proceeds from short-term loans and debt 178,089 -
Payments on short-term loans and debt (158,620 ) (27,389 )
Proceeds from issuance of long-term debt - 149,713
Cash dividends paid (116,706 ) (70,186 )
Exercise of stock options 4,804 2,630
Other financing activities (2,115 ) (2,087 )
Cash used for financing activities (14,548 ) (92,319 )
Effect of exchange rate changes on cash 14,646 (9,370 )
Net increase in cash and cash equivalents 67,630 74,737
Cash and cash equivalents, beginning of period 637,417 532,599
Cash and cash equivalents, end of period $ 705,047 $ 607,336
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