21.01.2010 13:00:00

2009 Fourth Quarter Results Reported by Amphenol Corporation

Amphenol Corporation (NYSE-APH) reported today fourth quarter 2009 diluted earnings per share of $.50 compared to $.56 per share for the comparable 2008 period. Such per share amount for the 2009 period included a one-time charge of $.02 per share relating to the termination of certain interest rate swap agreements as part of the refinancing associated with the Company’s $600 million senior note issuance in November. Such per share amount for the 2008 period included the benefit of $.03 per share relating to the cumulative reduction in the Company’s effective tax rate from 29% to 28%. Excluding these effects, diluted earnings per share was $.52 and $.53 for the fourth quarter of 2009 and 2008, respectively. Sales for the fourth quarter 2009 were $758.3 million compared to $755.3 million for the 2008 period. Currency translation had the effect of increasing sales by approximately 2% or $17.7 million in the fourth quarter 2009 compared to the 2008 period.

For the full year ended December 31, 2009, diluted earnings per share, excluding the one-time charge relating to the refinancing referenced above, was $1.85 compared to $2.34 for 2008. Sales for the full year ended December 31, 2009 were $2,820.1 million compared to $3,236.5 million for 2008. Currency translation had the effect of decreasing sales by approximately $38.2 million for the full year 2009 period when compared to 2008.

Amphenol President and Chief Executive Officer, R. Adam Norwitt, stated "We are pleased to close 2009 with strong fourth quarter results that exceeded the high end of the Company’s guidance. This represents our third consecutive quarter of sequential growth in sales and income, with sales of $758 million, an operating income margin of 18.3% and earnings per share of $.52 (excluding the one-time item). The 6% sequential sales increase was driven by strengthening demand in most markets including: Information Technology and Data Communications Equipment, Military/Aerospace, Industrial, Wireless Infrastructure and Automotive. It is very gratifying that we have been able to enhance our market position in nearly all of our served markets. Our strategy of ongoing market and geographic diversification combined with our strong commitment to develop performance enhancing technologies for our customers continues to expand the Company’s growth opportunities. In addition, it is extremely rewarding that our focus on operating leverage and working capital management enabled us to further expand margins and generate strong cash flow. Even with this improvement in demand, our management team continues to control costs in a proactive and dynamic manner ensuring the strength of our financial performance. I am very proud of our organization as we continue to execute well.”

"While overall economic conditions remain less than certain, we believe we have seen both an improvement in demand levels as well as a stabilization of demand patterns in most markets. As such, in 2010, we expect to see a return to more traditional seasonality. Accordingly, based on constant currency exchange rates, we expect Q1 2010 revenues in the range of $735 million to $750 million and EPS in the range of $.49 to $.51. We believe we can perform well in the current environment due to our leading technology, increasing positions with our customers in diverse markets, worldwide presence, lean cost structure, and agile, experienced and entrepreneurial management team.”

"We continue to be excited about the future. Our significant actions in 2009 to enhance our competitive advantages and build sustained financial strength have created a solid base for future performance. I am confident in the ability of our outstanding organization to dynamically adjust to the continued changing market environment, to generate strong profitability and to capitalize on opportunities to expand our market position.”

The Company will host a conference call to discuss its fourth quarter results at 1:00 PM (ET) January 21, 2010. The toll free dial-in number to participate in this call is 888-395-9624; International dial-in number is 517-623-4547; Passcode: Reardon. There will be a replay available until 11:00 P.M. (ET) on Monday, January 25, 2010. The replay numbers are as follows: toll free dial-in number is 888-566-0486 and International dial-in number is 203-369-3611; Passcode: 5137.

A live broadcast as well as a replay will also be available on the Internet at http://www.amphenol.com/index.cfm/fuseaction/financial.webcasts.

Amphenol Corporation is one of the world’s leading producers of electronic and fiber optic connectors, cable and interconnect systems. Amphenol products are engineered and manufactured in the Americas, Europe, Asia and Africa and sold by a worldwide sales and marketing organization. Amphenol has a diversified presence as a leader in high growth segments of the interconnect market including: Military, Commercial Aerospace, Automotive, Broadband Communication, Industrial, Information Technology and Data Communications Equipment, Mobile Devices and Wireless Infrastructure.

Statements in this press release which are other than historical facts are intended to be "forward-looking statements” within the meaning of the Securities Exchange Act of 1934, the Private Securities Litigation Reform Act of 1995 and other related laws. While the Company believes such statements are reasonable, the actual results and effects could differ materially from those currently anticipated. Please refer to [Part I, Item 1A] of the Company’s Form 10-K for the year ended December 31, 2008, for some factors that could cause the actual results to differ from estimates. In providing forward-looking statements, the Company is not undertaking any duty or obligation to update these statements publicly as a result of new information, future events or otherwise.

 
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
 
 
 
  Three Months Ended     Twelve Months Ended
December 31, December 31,
  2009         2008     2009         2008  
 
Net Sales $ 758,296 $ 755,282 $ 2,820,065 $ 3,236,471
 
Cost of sales   516,664     514,876     1,933,511     2,187,318  
 
Gross profit 241,632 240,406 886,554 1,049,153
 
Selling, general and administrative
expense   103,172     98,006     397,641     416,914  
 
Operating income 138,460 142,400 488,913 632,239
 
Interest expense (9,496 ) (10,041 ) (36,586 ) (39,627 )
Early extinguishment of interest rate swaps (4,575 ) - (4,575 ) -
Other (expenses) income, net   (283 )   137     (1,225 )   (32 )
 
Income before income taxes 124,106 132,496 446,527 592,580
 
Provision for income taxes   (34,129 )   (30,952 )   (119,311 )   (163,003 )
 
Net income 89,977 101,544 327,216 429,577
Less: Net income attributable to noncontrolling interest   (2,338 )   (2,811 )   (9,382 )   (10,426 )
 
Net income attributable to Amphenol Corporation $ 87,639   $ 98,733   $ 317,834   $ 419,151  
 
 
Net income per common share - Basic $ 0.51   $ 0.57   $ 1.85   $ 2.39  
 
Average shares outstanding - Basic   172,487,683     173,797,473     171,607,643     175,663,797  
 
Net income per common share - Diluted $ 0.50   $ 0.56   $ 1.83   $ 2.34  
 
Average shares outstanding - Diluted   175,068,731     175,545,630     173,941,752     178,813,013  
 
Dividends declared per common share $ 0.015   $ 0.015   $ 0.060   $ 0.060  
 
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
               
 
December 31, December 31,

2009

2008

 
ASSETS
 
Current Assets:
Cash and cash equivalents $ 384,613 $ 214,987
Accounts receivable, less allowance
for doubtful accounts of $18,785
and $14,982, respectively 449,591 515,999
Inventories, net 461,750 512,507
Other current assets   124,441     92,371  
 
Total current assets 1,420,395 1,335,864
 
Land and depreciable assets, less
accumulated depreciation of
$575,187 and $510,764, respectively 332,875 344,515
Goodwill 1,368,672 1,232,335
Other long-term assets   97,242     81,445  
 
$ 3,219,184   $ 2,994,159  
 
LIABILITIES & SHAREHOLDERS' EQUITY
 
Current Liabilities:
Accounts payable $ 292,122 $ 305,950
Accrued salaries, wages and employee benefits 64,143 59,644
Accrued income taxes 57,272 65,846
Accrued acquisition-related obligations 7,244 120,357
Other accrued expenses 81,979 82,596
Current portion of long-term debt and capital lease obligations   399     439  
 
Total current liabilities 503,159 634,832
 
Long-term debt and capital lease obligations 753,050 786,020
Accrued pension and post employment
benefit obligations 172,235 161,669
Other long-term liabilities 27,922 43,069
 
Shareholders' Equity:
Common stock 174 171
Additional paid-in capital 71,368 22,746
Accumulated earnings 1,774,625 1,467,099
Accumulated other comprehensive loss   (100,090 )   (140,591 )
 
Total shareholders' equity attributable to Amphenol Corporation 1,746,077 1,349,425
 
Noncontrolling interests   16,741     19,144  
 
Total equity   1,762,818     1,368,569  
 
$ 3,219,184   $ 2,994,159  
 
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(dollars in thousands)
       
 
Twelve months ended
December 31,
  2009     2008  
 
Net income $ 327,216 $ 429,577
Adjustments for cash from operations:
Depreciation and amortization 98,524 91,302
Stock-based compensation 20,240 16,316
Net change in receivables sold (3,000 ) -
Excess tax benefits from stock-based payment arrangements (16,085 ) (21,307 )
Net change in components of working capital 144,654 (18,689 )
Net change in other long-term assets and liabilities   10,748     (15,676 )
 
Cash provided by operations   582,297     481,523  
 
Cash flow from investing activities:
Capital additions, net (59,834 ) (107,340 )
Purchase of short term investments (33,342 ) (2,938 )
Investments in acquisitions   (280,014 )   (135,807 )
 
Cash flow used in investing activities   (373,190 )   (246,085 )
 
Cash flow from financing activities:
Net change in borrowings under revolving
credit facilities (631,934 ) 61,914
Borrowings under senior notes 598,878 -
Settlement of interest rate swap agreements (4,575 ) -
Payments of fees and expenses related to senior notes financing (4,650 ) -
Purchase of treasury stock - (293,625 )
Proceeds from exercise of stock options 25,481 27,081
Excess tax benefits from stock-based payment arrangements 16,085 21,307
Payments to noncontrolling interests (23,328 ) -
Dividend payments   (10,279 )   (10,617 )
 
Cash flow used in financing activities   (34,322 )   (193,940 )
 
Effect of exchange rate changes on cash and cash equivalents (5,159 ) (10,152 )
 
Net change in cash and cash
equivalents 169,626 31,346
Cash and cash equivalents
balance, beginning of period   214,987     183,641  
 
Cash and cash equivalents
balance, end of period $ 384,613   $ 214,987  
 

Cash paid during the period for:

Interest $ 38,532 $ 39,180
Income taxes 117,122 124,929
 
AMPHENOL CORPORATION
SEGMENT INFORMATION
(dollars in thousands)
                 
 
 
Three months ended Twelve months ended
December 31, December 31,
  2009     2008     2009     2008  
 
Trade Sales:
Interconnect Products $ 695,127 $ 692,656 $ 2,566,578 $ 2,950,570
Cable Products   63,169     62,626     253,487     285,901  
Consolidated $ 758,296   $ 755,282   $ 2,820,065   $ 3,236,471  
 
 
Operating income:
Interconnect Products $ 142,866 $ 147,919 $ 505,772 $ 648,605
Cable Products 9,798 7,004 38,751 32,535
Stock-based compensation expense (4,981 ) (4,539 ) (20,241 ) (16,316 )
Other operating expenses   (9,223 )   (7,984 )   (35,369 )   (32,585 )
Consolidated $ 138,460   $ 142,400   $ 488,913   $ 632,239  
 
 
ROS%:
Interconnect Products 20.6 % 21.4 % 19.7 % 22.0 %
Cable Products 15.5 % 11.2 % 15.3 % 11.4 %
Corporate - stock-based compensation -0.7 % -0.6 % -0.7 % -0.5 %
Corporate - all other -1.2 % -1.1 % -1.3 % -1.0 %
 
 
Consolidated 18.3 % 18.9 % 17.3 % 19.5 %

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