Molex Incorporated (NASDAQ: MOLX and MOLXA), a global electronic
components company, today reported results for its 2009 fourth
fiscal quarter and its full fiscal year 2009, both ended June 30,
2009.
2009 Fourth Fiscal Quarter
Results
Revenue for the quarter ended June 30, 2009 of $570.6 million
was at the higher end of the range estimated in the release dated
April 21, 2009 and increased 12.9% from the March 2009 quarter.
Revenue decreased 34.6% from the prior year June quarter and fell
31.4% in local currencies as currency translation decreased revenue
by $27.9 million.
Gross profit margin was 24.1%, compared with 18.5% in the March
2009 quarter, and 31.0% in the prior year June quarter. The
increase in gross profit margin from the March quarter reflects the
higher revenue level and cost savings from the previously announced
restructuring program. The decline in gross profit margin from the
prior year June quarter reflected lower absorption of manufacturing
overhead resulting from significantly lower production volume.
SG&A expense declined $2.4 million from the March quarter
and $34.4 million from last year’s June quarter, due to the cost
reduction actions and additional savings from the restructuring
program. Research and development expense was $39.6 million,
compared with $34.9 million in the March 2009 quarter. The increase
in research and development expense underscores the Company’s
commitment to new product development and supports the goal of
remaining a technology leader in the industry. During fiscal 2009
the Company released 194 new products.
Net loss was $219.7 million or $1.27 per share for the quarter.
Included in the quarter results was a pretax restructuring charge
of $28.0 million ($21.1 million after-tax or $0.12 per share),
relating to the restructuring program. We also recorded pretax
intangible asset impairments and other charges of $17.6 million
($11.1 million after-tax or $0.07 per share) and a pretax and
after-tax goodwill impairment charge of $171.0 million ($0.99 per
share) for our Automation & Electrical business unit of our
Custom & Electrical segment due to the impact of the recent
downturn in the industrial market. The June quarter compares with
net income of $52.6 million, or $0.29 per share in the prior year
June quarter that included a pretax restructuring charge of $15.0
million, or approximately $0.06 per share after-tax. The effective
tax rate for the quarter was (2.1%) due primarily to the impairment
of goodwill which does not result in a tax benefit, additional tax
contingency reserves and recording valuation allowances for certain
jurisdictions with losses that may not generate realizable tax
benefits.
Excluding the restructuring and impairment charges, the Company
generated a non-GAAP pretax profit of $1.3 million for the June
quarter. A complete reconciliation of this non-GAAP measure can be
found on page 5.
Orders for the June quarter were $576 million, an improvement of
21% from the March 2009 quarter, but down 33% compared with the
prior year June quarter. The Company’s order backlog at June 30,
2009 was $253 million, compared with $436 million at June 30, 2008
and $251 million at March 31, 2009. The book-to-bill ratio was
1.01.
Capital expenditures for the June 2009 quarter were $50.3
million, compared with $31.1 million in the March 2009 quarter and
$71.2 million in the prior year June quarter. Capital spending
during the June quarter was primarily for equipment and production
tooling related to new product development but included $14.4
million related to the restructuring program.
Cash flow from operations was $58.3 million for the June quarter
and $369.9 million for the fiscal year ended June 30, 2009. Cash
and marketable securities were $467.9 million at June 30, 2009, a
decline of $38.0 million from March 31, 2009, though $31.1 million
of cash was used to repay debt during the June 2009 quarter.
Molex Chief Executive Officer, Martin P. Slark, commented on the
quarter, “We are encouraged by the improvement in business levels,
especially in the month of June when both revenue and orders
reached their high for the quarter. It appears that inventory
reductions in our industry’s supply chain are substantially
complete, which should result in further improvements in our
business levels during the September quarter. In addition, we have
been aggressive in our response to the business environment,
including reducing our headcount by 24% over the last three
quarters and controlling capital expenditures for the year to the
lowest level since 2003. As a result, we generated significant
operating leverage during the quarter as demonstrated by the 560
basis point sequential improvement in gross profit margin.”
Restructuring
Update
The pretax restructuring charge of $28.0 million recorded in the
June quarter was primarily related to severance costs for
previously announced actions in Europe and Asia as well as an early
retirement plan in Japan that was announced in April.
The cumulative pretax restructuring charges expected to be
incurred through the end of fiscal year 2010 remains in a range of
$240 to $250 million. Cumulative restructuring charges were $198
million through June 30, 2009, with the remainder to be recognized
in fiscal 2010. The expected annual cost savings from the
restructuring program remains in a range of $190 to $210
million.
Full Year
Results
Revenue for the full fiscal year ended June 30, 2009 was $2.6
billion, a decline of 22.4% compared with the prior fiscal year.
During the fiscal year, currency translation increased revenue by
$5.2 million. Net loss of $321.3 million, or $1.84 per share
included a pretax restructuring charge of $131.3 million ($99.0
million after-tax or $0.57 per share), pretax intangible asset
impairments and other charges of $20.2 million ($12.8 million
after-tax or $0.7 per share), and a pretax and after-tax goodwill
impairment charge of $264.1 million ($1.51 per share). The
effective tax rate for the full year was (0.8%), due primarily to
the impairment of goodwill which does not result in a tax benefit
and recording valuation allowances for certain jurisdictions with
losses that may not generate realizable tax benefits.
Capital expenditures for fiscal 2009 were $177.9 million or 6.9%
of revenue, and included expenditures related to the restructuring
program. This compares with $234.6 million or 7.0% of revenue for
the prior fiscal year. Capital expenditures for fiscal 2009 were
significantly reduced to match demand and to maximize cash flow in
this difficult economy.
Outlook
The improved order rate during the June quarter and through July
suggests that both revenue and orders for the September quarter
should be above the June quarter level. However, as future
visibility remains limited, the Company considers it prudent to
provide a relatively wide range for its outlook, and estimates
revenue in a range of $590 to $630 million for the September
quarter. At this level of revenue, the Company expects earnings per
share in a range of $0.00 to $0.06, assuming an effective tax rate
of 34%. Included in these estimates is a pretax restructuring
charge of approximately $10 million or $0.04 per share after-tax.
Due to the limited visibility caused by current economic
conditions, the Company will not provide full year guidance at this
time.
Earnings Webcast and August
5th
Analysts Meeting
Information
A webcast will be held at 10:00am central on Wednesday, August
5th at the start of the Molex Analysts Meeting to be held at Molex
Incorporated in Lisle, Illinois. Internet users will be able to
access the webcast live and in replay (audio and slides) for the
portion of the meeting between 10:00-11:45am central in the
“Investors” section of the Company’s website at www.molex.com.
Other Investor
Events
September 10, 2009
– 2009 Citi Technology Conference in New York, NY
September 14, 2009
– Deutsche Bank Technology 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 “anticipates,” “expects,” “believes,”
“intends,” “plans,” “projects,” “estimates,” 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; the financial condition of our customers; the challenges
attendant to plant closings and restructurings, including the
difficulty of predicting plant closing and relocation costs, the
difficulty of commencing or increasing production at existing
facilities, and the reactions of customers, governmental units,
employees and other groups, the challenges attendant to plant
construction; and the ability to realize cost savings from
restructuring activities.
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, 2008 and disclosed in the Form 10-Q for the quarters ended
September 30, 2008, December 31, 2008 and March 31, 2009 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 71-year-old global manufacturer of
electronic, electrical and fiber optic interconnection systems.
Based in Lisle, Illinois, USA, the Company operates 43
manufacturing locations in 18 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
Non-GAAP Measure
(in thousands) Three months ended June 30,
2009: Income (loss) before income taxes (GAAP) $ (215,289 )
Restructuring costs and asset impairments 45,627 Goodwill
impairments 171,000 Non-GAAP pretax profit $ 1,338
Non-GAAP pretax profit is a non-GAAP financial measure. We refer
to Non-GAAP pretax profit to describe earnings excluding the items
referenced above. We believe that Non-GAAP pretax profit provides
useful information to investors because it provides information
about the estimated financial performance of Molex’s ongoing
business. Non-GAAP pretax profit is used by management in its
financial and operational decision-making and evaluation of overall
operating performance and segment level core operating performance.
Non-GAAP pretax profit may be different from similar measures used
by other companies.
Molex Incorporated
Consolidated Balance
Sheets
(in thousands, except per share
data)
ASSETS
June 30,
2009
2008 Current assets: Cash and cash equivalents $ 424,707 $
475,507 Marketable securities 43,234 34,298 Accounts receivable,
less allowances of $32,593 in 2009 and $40,243 in 2008 528,907
740,827 Inventories 354,337 458,295 Deferred income taxes 27,939
23,444 Prepaid expenses 68,449 50,589 Total current
assets 1,447,573 1,782,960 Property, plant and equipment, net
1,080,417 1,172,395 Goodwill 128,494 373,623 Non-current deferred
income taxes 89,332 62,521 Other assets 196,341
208,038 Total assets $ 2,942,157 $ 3,599,537
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities: Short-term loans $ 224,340 $ 66,687 Accounts
payable 266,633 350,413 Accrued expenses: Salaries, commissions and
bonuses 55,109 74,689 Restructuring 69,928 19,842 Other 93,392
64,683 Income taxes payable 4,750 73,124 Total
current liabilities 714,152 649,438 Other non-current liabilities
21,862 21,346 Accrued pension and other postretirement benefits
113,268 105,574 Long-term debt 30,311 146,333 Total
liabilities 879,593 922,691 Commitments and contingencies
Total stockholders’ equity 2,062,564 2,676,846
Total liabilities and stockholders’ equity $ 2,942,157 $ 3,599,537
Molex Incorporated
Condensed Consolidated
Statements of Operations
(in thousands, except per share data) Three
Months Ended Years Ended
June 30,
June 30, 2009 2008 2009 2008 (Unaudited) Net
revenue $ 570,589 $ 871,892 $ 2,581,841 $ 3,328,347 Cost of sales
433,352 601,383 1,925,664
2,314,112 Gross profit 137,237 270,509
656,177 1,014,235 Selling, general and
administrative 136,668 171,065 586,702 665,038 Restructuring costs
and asset impairments 45,627 14,961 151,531 31,247 Goodwill
impairments 171,000 - 264,140 - Total
operating expenses 353,295 186,026
1,002,373 696,285 Income (loss) from
operations (216,058 ) 84,483 (346,196 ) 317,950 Interest
income (expense), net (326 ) 2,228 1,961 9,192 Other income (loss)
1,095 4,265 25,347 11,506
Total other income, net 769 6,4932
7,308 20,698 Income (loss) before income taxes
(215,289 ) 90,976 (318,888 ) 338,648 Income taxes
4,451 38,365 2,399 123,211
Net (loss) income $ (219,740 ) $ 52,611 $ (321,287 ) $ 215,437
Earnings (loss) per share: Basic $ (1.27 ) $ 0.30 $ (1.84 )
$ 1.19 Diluted $ (1.27 ) $ 0.29 $ (1.84 ) $ 1.19 Average
common shares outstanding: Basic 173,290 177,927 174,598 180,474
Diluted 173,290 178,965 174,598 181,395
Molex Incorporated
Consolidated Statements of Cash
Flows
(in thousands) Years Ended June 30, 2009 2008
2007 Operating activities: Net income $ (321,287 ) $ 215,437 $
240,768 Add (deduct) non-cash items included in net income:
Depreciation and amortization 251,902 252,344 237,912 Goodwill
impairment 264,140 - - Asset write-downs included in restructuring
costs 41,376 13,599 8,667 (Gain) loss on investments (143 ) 111
(1,154 ) Deferred income taxes (26,606 ) 31,096 20,998 Loss (gain)
on sale of property, plant and equipment 2,478 296 1,800
Share-based compensation 26,508 24,24 927,524 Other non-cash items
(8,124 ) (6,778 ) 23,373 Changes in assets and liabilities,
excluding effects of foreign currency adjustments and acquisitions:
Accounts receivable 201,080 478 27,913 Inventories 95,529 (26,240 )
(16,514 ) Accounts payable (84,502 ) 34,197 (57,479 ) Other current
assets and liabilities (24,967 ) (45,798 ) (60,421 ) Other assets
and liabilities (47,486 ) (13,857 ) (1,953 )
Cash provided from operating activities 369,898
479,134 451,434 Investing
activities: Capital expenditures (177,943 ) (234,626 ) (296,861 )
Proceeds from sales of property, plant and equipment 9,574 14,978
9,946 Proceeds from sales or maturities of marketable securities
29,549 811,724 4,856,301 Purchases of marketable securities (42,751
) (764,966 ) (4,785,080 ) Acquisitions, net of cash acquired
(74,789 ) (42,503 ) (238,072 ) Other investing activities
3,274 (2,763 ) 7,637 Cash used for
investing activities (253,086 ) (218,156 )
(446,129 ) Financing activities: Proceeds from revolving
credit facility and short-term loans 245,000 139,590 44,000
Payments on revolving credit facility (295,000 ) (75,000 ) (44,000
) Proceeds from issuance of long-term debt 78,060 - 131,045
Payments of long-term debt (1,827 ) (1,948 ) (26,937 ) Cash
dividends paid (99,640 ) (74,598 ) (55,176 ) Exercise of stock
options 1,692 16,732 15,416 Excess tax benefits from share-based
compensation 1,693 1,677 1,714 Purchase of treasury stock (76,342 )
(199,583 ) (34,889 ) Other financing activities (9,218 )
(4,176 ) (2,644 ) Cash (used for) provided from
financing activities (155,582 ) (197,306 ) 28,529 Effect of
exchange rate changes on cash (12,030 ) 33,474
11,712 Net (decrease) increase in cash and cash
equivalents (50,800 ) 97,146 45,546 Cash and cash equivalents,
beginning of year 475,507 378,361
332,815 Cash and cash equivalents, end of year $
424,707 $ 475,507 $ 378,361
Molex Incorporated (MM) (NASDAQ:MOLX)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
Molex Incorporated (MM) (NASDAQ:MOLX)
Historical Stock Chart
Von Jul 2023 bis Jul 2024