Strong Execution Drives Performance Above
Guidance
Littelfuse, Inc. (NASDAQ: LFUS), a diversified, industrial
technology manufacturing company empowering a sustainable,
connected, and safer world, today reported financial results for
the third quarter ended September 30, 2023:
- Net sales of $607.1 million were down 8% versus the prior year
period, and down 11% organically
- GAAP diluted EPS was $2.30; adjusted diluted EPS was $2.97
- Cash flow from operations was $161.5 million and free cash flow
was $139.8 million
“In the third quarter, sales and earnings exceeded our
expectations, despite pockets of end market softness and ongoing
inventory destocking,” said Dave Heinzmann, Littelfuse President
and Chief Executive Officer. “Our year-to-date performance
underscores the resilience of our business model, strong cash
generation, and consistent execution. Looking ahead, while dynamic
macro conditions likely persist, our improved cost structure,
healthy balance sheet, and ability to optimize cash flow should
position us well into 2024. Our experienced team will continue to
leverage our competitive advantages across our evolving and
diversified end markets.”
Fourth Quarter of 2023*
Based on current market conditions, for the fourth quarter the
company expects,
- Net sales in the range of $520 to $550 million, adjusted
diluted EPS in the range of $1.90 to $2.10 and an adjusted
effective tax rate of approximately 18%
*Littelfuse provides guidance on a non-GAAP (adjusted) basis.
GAAP items excluded from guidance may include the after-tax impact
of items including acquisition and integration costs,
restructuring, impairment and other charges, certain purchase
accounting adjustments, non-operating foreign exchange adjustments
and significant and unusual items. These items are uncertain,
depend on various factors, and could be material to results
computed in accordance with GAAP. Littelfuse is not able to
forecast the excluded items in order to provide the most directly
comparable GAAP financial measure without unreasonable efforts.
Dividend
- The company will pay a cash dividend on its common stock of
$0.65 per share on December 7, 2023, to shareholders of record as
of November 23, 2023.
Conference Call and Webcast
Information
Littelfuse will host a conference call on Wednesday, November 1,
2023, at 9:00 a.m. Central Time to discuss the results. The call
will be broadcast and available for replay at Littelfuse.com. A
slide presentation is available in the Investor Relations section
of the company’s website at Littelfuse.com.
About Littelfuse
Littelfuse, Inc. (NASDAQ: LFUS) is a diversified, industrial
technology manufacturing company empowering a sustainable,
connected, and safer world. Across more than 20 countries, and with
approximately 17,000 global associates, we partner with customers
to design and deliver innovative, reliable solutions. Serving over
100,000 end customers, our products are found in a variety of
industrial, transportation and electronics end markets –
everywhere, every day. Learn more at Littelfuse.com.
“Safe Harbor” Statement under the
Private Securities Litigation Reform Act of 1995
The statements in this press release that are not historical
facts are intended to constitute "forward-looking statements"
entitled to the safe-harbor provisions of the Private Securities
Litigation Reform Act. Such statements are based on Littelfuse,
Inc.’s (“Littelfuse” or the “Company”) current expectations and are
subject to a number of factors and uncertainties, which could cause
actual results to differ materially from those described in the
forward-looking statements. These risks and uncertainties, include,
but are not limited to, risks and uncertainties relating to general
economic conditions; product demand and market acceptance; the
impact of competitive products and pricing; product quality
problems or product recalls; capacity and supply difficulties or
constraints; coal mining exposures reserves; cybersecurity matters;
failure of an indemnification for environmental liability; exchange
rate fluctuations; commodity and other raw material price
fluctuations; the effect of Littelfuse accounting policies; labor
disputes; restructuring costs in excess of expectations; pension
plan asset returns less than assumed; integration of acquisitions;
uncertainties related to political or regulatory changes; and other
risks which may be detailed in the company's Securities and
Exchange Commission filings. Should one or more of these risks or
uncertainties materialize or should the underlying assumptions
prove incorrect, actual results and outcomes may differ materially
from those indicated or implied in the forward-looking statements.
This release should be read in conjunction with information
provided in the financial statements appearing in the company's
Annual Report on Form 10-K for the year ended December 31, 2022.
Further discussion of the risk factors of the company can be found
under the caption "Risk Factors" in the company's Annual Report on
Form 10-K for the year ended December 31, 2022, and in other
filings and submissions with the SEC, each of which are available
free of charge on the company’s investor relations website at
investor.littelfuse.com and on the SEC’s website at www.sec.gov.
These forward-looking statements are made as of the date hereof.
The company does not undertake any obligation to update, amend or
clarify these forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the availability
of new information.
Non-GAAP Financial
Measures
The information included in this press release includes the
non-GAAP financial measures of organic net sales (decline) growth,
adjusted operating income, adjusted operating margin, adjusted
EBITDA, adjusted EBITDA margin, adjusted diluted earnings per
share, adjusted income taxes, adjusted effective tax rate, free
cash flow, net debt, consolidated EBITDA, and consolidated net
leverage ratio (as defined in the credit agreement). Many of these
non-GAAP financial measures exclude the effect of certain expenses
and income not related directly to the underlying performance of
our fundamental business operations.
A reconciliation of these non-GAAP financial measures to the
most directly comparable GAAP financial measures is set forth in
the attached schedules.
The company believes that organic net sales (decline) growth,
adjusted operating income, adjusted operating margin, adjusted
EBITDA, adjusted EBITDA margin, adjusted diluted earnings per
share, adjusted income taxes, and adjusted effective tax rate
provide useful information to investors regarding its operational
performance because they enhance an investor’s overall
understanding of our core financial performance and facilitate
comparisons to historical results of operations, by excluding items
that are not related directly to the underlying performance of our
fundamental business operations or were not part of our business
operations during a comparable period. The company believes that
free cash flow is a useful measure of its ability to generate cash.
The company believes that net debt, consolidated EBITDA, and
consolidated net leverage ratio are useful measures of its credit
position. The company believes that all of these non-GAAP financial
measures are commonly used by financial analysts and others in the
industries in which we operate, and thus further provide useful
information to investors. Management additionally uses these
measures when assessing the performance of the business and for
business planning purposes. Note that our definitions of these
non-GAAP financial measures may differ from those terms as defined
or used by other companies.
LFUS-F
LITTELFUSE, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited)
(in thousands)
September 30,
2023
December 31,
2022
ASSETS
Current assets:
Cash and cash equivalents
$
560,056
$
562,588
Short-term investments
229
84
Trade receivables, less allowances of
$88,440 and $83,562 at September 30, 2023 and December 31, 2022,
respectively
327,500
306,578
Inventories
483,075
547,690
Prepaid income taxes and income taxes
receivable
3,776
7,215
Prepaid expenses and other current
assets
83,684
87,641
Total current assets
1,458,320
1,511,796
Net property, plant, and equipment
478,906
481,110
Intangible assets, net of amortization
612,366
593,970
Goodwill
1,284,343
1,186,922
Investments
23,371
24,121
Deferred income taxes
13,598
14,367
Right of use lease assets, net
51,755
57,382
Other long-term assets
80,267
34,066
Total assets
$
4,002,926
$
3,903,734
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
$
166,725
$
208,571
Accrued liabilities
143,540
187,057
Accrued income taxes
35,762
41,793
Current portion of long-term debt
135,619
134,874
Total current liabilities
481,646
572,295
Long-term debt, less current portion
857,006
866,623
Deferred income taxes
106,656
100,230
Accrued post-retirement benefits
29,445
28,037
Non-current operating lease
liabilities
39,818
45,661
Other long-term liabilities
83,496
79,510
Total equity
2,404,859
2,211,378
Total liabilities and equity
$
4,002,926
$
3,903,734
LITTELFUSE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF NET INCOME
(Unaudited)
Three Months Ended
Nine Months Ended
(in thousands, except per share
data)
September 30,
2023
October 1, 2022
September 30,
2023
October 1, 2022
Net sales
$
607,071
$
658,880
$
1,828,850
$
1,900,646
Cost of sales
380,200
402,059
1,122,190
1,122,258
Gross profit
226,871
256,821
706,660
778,388
Selling, general, and administrative
expenses
87,204
90,219
270,057
258,820
Research and development expenses
25,484
25,752
77,270
68,796
Amortization of intangibles
16,022
15,567
49,773
39,883
Restructuring, impairment, and other
charges
4,516
3,413
13,221
4,265
Total operating expenses
133,226
134,951
410,321
371,764
Operating income
93,645
121,870
296,339
406,624
Interest expense
10,101
8,399
29,803
17,069
Foreign exchange loss
11,776
18,191
8,697
40,051
Other (income) expense, net
(3,527
)
(698
)
(11,810
)
9,789
Income before income taxes
75,295
95,978
269,649
339,715
Income taxes
17,507
20,510
53,045
59,713
Net income
$
57,788
$
75,468
$
216,604
$
280,002
Earnings per share:
Basic
$
2.32
$
3.05
$
8.72
$
11.32
Diluted
$
2.30
$
3.02
$
8.63
$
11.21
Weighted-average shares and equivalent
shares outstanding:
Basic
24,893
24,755
24,838
24,726
Diluted
25,143
24,988
25,100
24,986
Comprehensive income
$
55,654
$
47,280
$
212,842
$
218,262
LITTELFUSE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
(in thousands)
September 30, 2023
October 1, 2022
OPERATING ACTIVITIES
Net income
$
216,604
$
280,002
Adjustments to reconcile net income to net
cash provided by operating activities:
137,988
183,942
Changes in operating assets and
liabilities:
Trade receivables
(21,752
)
(56,431
)
Inventories
66,456
(83,803
)
Accounts payable
(38,475
)
(3,838
)
Accrued liabilities and income taxes
(61,359
)
(4,399
)
Prepaid expenses and other assets
13,678
(2,034
)
Net cash provided by operating
activities
313,140
313,439
INVESTING ACTIVITIES
Acquisitions of businesses, net of cash
acquired
(198,810
)
(532,772
)
Purchases of property, plant, and
equipment
(63,166
)
(77,773
)
Net proceeds from sale of property, plant
and equipment, and other
597
565
Net cash used in investing activities
(261,379
)
(609,980
)
FINANCING ACTIVITIES
Net payments of credit facility
(5,625
)
373,125
Cash dividends paid
(45,973
)
(41,055
)
All other cash provided by (used in)
financing activities
4,454
(10,147
)
Net cash (used in) provided by financing
activities
(47,144
)
321,923
Effect of exchange rate changes on cash,
cash equivalents, and restricted cash
(7,965
)
(31,963
)
Decrease in cash, cash equivalents, and
restricted cash
(3,348
)
(6,581
)
Cash, cash equivalents, and restricted
cash at beginning of period
564,939
482,836
Cash, cash equivalents, and restricted
cash at end of period
$
561,591
$
476,255
LITTELFUSE, INC.
NET SALES AND OPERATING INCOME
BY SEGMENT
(Unaudited)
Third Quarter
Year-to-Date
(in thousands)
2023
2022
% Growth /
(Decline)
2023
2022
% Growth /
(Decline)
Net sales
Electronics
$
343,933
$
397,629
(13.5
)%
$
1,052,673
$
1,121,626
(6.1
)%
Transportation
177,019
181,735
(2.6
)%
515,708
548,266
(5.9
)%
Industrial
86,119
79,516
8.3
%
260,469
230,754
12.9
%
Total net sales
$
607,071
$
658,880
(7.9
)%
$
1,828,850
$
1,900,646
(3.8
)%
Operating income
Electronics
$
77,022
$
113,140
(31.9
)%
$
247,028
$
339,675
(27.3
)%
Transportation
9,694
12,987
(25.4
)%
26,015
57,604
(54.8
)%
Industrial
13,201
12,178
8.4
%
45,450
39,968
13.7
%
Other(a)
(6,272
)
(16,435
)
N.M.
(22,154
)
(30,623
)
N.M.
Total operating income
$
93,645
$
121,870
(23.2
)%
$
296,339
$
406,624
(27.1
)%
Operating Margin
15.4
%
18.5
%
16.2
%
21.4
%
Interest expense
10,101
8,399
29,803
17,069
Foreign exchange loss
11,776
18,191
8,697
40,051
Other (income) expense, net
(3,527
)
(698
)
(11,810
)
9,789
Income before income taxes
$
75,295
$
95,978
(21.5
)%
$
269,649
$
339,715
(20.6
)%
(a) "other" typically includes non-GAAP
adjustments such as acquisition-related and integration costs,
purchase accounting inventory adjustments and restructuring and
impairment charges. (See Supplemental Financial Information for
details.)
N.M. - Not meaningful
Third Quarter
Year-to-Date
(in thousands)
2023
2022
% (Decline)
2023
2022
% Growth /
(Decline)
Operating Margin
Electronics
22.4
%
28.5
%
(6.1
)%
23.5
%
30.3
%
(6.8
)%
Transportation
5.5
%
7.1
%
(1.6
)%
5.0
%
10.5
%
(5.5
)%
Industrial
15.3
%
15.3
%
—
%
17.4
%
17.3
%
0.1
%
LITTELFUSE, INC.
SUPPLEMENTAL FINANCIAL
INFORMATION
(In millions of USD except per
share amounts - unaudited)
Non-GAAP EPS reconciliation
Q3-23
Q3-22
YTD-23
YTD-22
GAAP diluted EPS
$
2.30
$
3.02
$
8.63
$
11.21
EPS impact of Non-GAAP adjustments
(below)
0.67
1.26
1.09
2.32
Adjusted diluted EPS
$
2.97
$
4.28
$
9.72
$
13.53
Non-GAAP adjustments - (income) /
expense
Q3-23
Q3-22
YTD-23
YTD-22
Acquisition-related and integration costs
(a)
$
1.8
$
6.2
$
9.0
$
14.8
Purchase accounting inventory adjustments
(b)
—
6.8
—
11.6
Restructuring, impairment and other
charges (c)
4.5
3.4
13.2
4.3
Non-GAAP adjustments to operating
income
6.3
16.4
22.2
30.7
Other income, net (d)
—
—
(0.2
)
(0.5
)
Non-operating foreign exchange loss
11.8
18.2
8.7
40.1
Non-GAAP adjustments to income before
income taxes
18.1
34.6
30.7
70.3
Income taxes (e)
1.2
3.0
3.2
12.2
Non-GAAP adjustments to net income
$
16.9
$
31.6
$
27.5
$
58.1
Total EPS impact
$
0.67
$
1.26
$
1.09
$
2.32
Adjusted operating margin / Adjusted
EBITDA reconciliation
Q3-23
Q3-22
YTD-23
YTD-22
Net income
$
57.8
$
75.5
$
216.6
$
280.0
Add:
Income taxes
17.5
20.5
53.0
59.7
Interest expense
10.1
8.4
29.8
17.1
Foreign exchange loss
11.8
18.2
8.7
40.1
Other (income) expense, net
(3.5
)
(0.7
)
(11.8
)
9.8
GAAP operating income
$
93.6
$
121.9
$
296.3
$
406.6
Non-GAAP adjustments to operating
income
6.3
16.4
22.2
30.7
Adjusted operating income
$
99.9
$
138.3
$
318.5
$
437.3
Amortization of intangibles
16.0
15.6
49.8
39.9
Depreciation expenses
17.9
17.0
53.5
48.3
Adjusted EBITDA
$
133.8
$
170.9
$
421.8
$
525.5
Net sales
$
607.1
$
658.9
$
1,828.9
$
1,900.6
Net income as a percentage of net
sales
9.5
%
11.5
%
11.8
%
14.7
%
Operating margin
15.4
%
18.5
%
16.2
%
21.4
%
Adjusted operating margin
16.5
%
21.0
%
17.4
%
23.0
%
Adjusted EBITDA margin
22.0
%
25.9
%
23.1
%
27.6
%
Adjusted EBITDA by Segment
Q3-23
Q3-22
Electronics
Transportation
Industrial
Electronics
Transportation
Industrial
GAAP operating income
$
77.0
$
9.7
$
13.2
$
113.1
$
13.0
$
12.2
Add:
Add back amortization
9.8
3.6
2.6
9.7
4.7
1.2
Add back depreciation
9.8
6.6
1.5
9.4
6.7
1.0
Adjusted EBITDA
$
96.6
$
19.9
$
17.3
$
132.2
$
24.4
$
14.4
Adjusted EBITDA Margin
28.1
%
11.2
%
20.1
%
33.3
%
13.4
%
18.1
%
Adjusted EBITDA by Segment
YTD-23
YTD-22
Electronics
Transportation
Industrial
Electronics
Transportation
Industrial
GAAP operating income
$
247.0
$
26.0
$
45.5
$
339.7
$
57.6
$
40.0
Add:
Add back amortization
30.1
12.2
7.5
22.5
13.7
3.7
Add back depreciation
29.1
20.4
4.0
26.5
19.0
2.9
Adjusted EBITDA
$
306.2
$
58.6
$
57.0
$
388.7
$
90.3
$
46.5
Adjusted EBITDA Margin
29.1
%
11.4
%
21.9
%
34.7
%
16.5
%
20.1
%
Net sales reconciliation
Q3-23 vs. Q3-22
Electronics
Transportation
Industrial
Total
Net sales (decline) growth
(14
)%
(3
)%
8
%
(8
)%
Less:
Acquisitions
2
%
—
%
3
%
2
%
FX impact
1
%
1
%
—
%
1
%
Organic net sales (decline) growth
(17
)%
(4
)%
5
%
(11
)%
Net sales reconciliation
YTD-23 vs. YTD-22
Electronics
Transportation
Industrial
Total
Net sales (decline) growth
(6
)%
(6
)%
13
%
(4
)%
Less:
Acquisitions
8
%
—
%
4
%
5
%
FX impact
—
%
—
%
—
%
—
%
Organic net sales (decline) growth
(14
)%
(6
)%
9
%
(9
)%
Income tax reconciliation
Q3-23
Q3-22
YTD-23
YTD-22
Income taxes
$
17.5
$
20.5
$
53.0
$
59.7
Effective rate
23.3
%
21.4
%
19.7
%
17.6
%
Non-GAAP adjustments - income taxes
1.2
3.0
3.2
12.2
Adjusted income taxes
$
18.7
$
23.4
$
56.2
$
71.9
Adjusted effective rate
20.0
%
18.0
%
18.7
%
17.5
%
Free cash flow reconciliation
Q3-23
Q3-22
YTD-23
YTD-22
Net cash provided by operating
activities
$
161.5
$
148.1
$
313.1
$
313.4
Less: Purchases of property, plant and
equipment
(21.7
)
(21.7
)
(63.2
)
(77.8
)
Free cash flow
$
139.8
$
126.5
$
250.0
$
235.7
Consolidated Total Debt
As of September 30,
2023
Consolidated Total Debt
$
992.6
Unamortized debt issuance costs
4.0
Consolidated funded indebtedness
996.6
Cash held in U.S. (up to $400 million)
155.6
Net debt
$
841.0
Consolidated EBITDA
Twelve Months Ended September
30, 2023
Net Income
$
309.7
Interest expense
38.9
Income taxes
63.1
Depreciation
70.2
Amortization
65.6
Non-cash additions:
Stock-based compensation expense
24.0
Purchase accounting inventory step-up
charge
4.1
Unrealized loss on investments
1.2
Impairment charges
9.2
Other
(3.7
)
Consolidated EBITDA (1)
$
582.3
Consolidated Net Leverage Ratio (as
defined in the Credit Agreement) *
1.4
x
* Our Credit Agreement and Private
Placement Note with maturities ranging from 2023 to 2032, contain
financial ratio covenants providing that if, as of the last day of
each fiscal quarter, the Consolidated Net Leverage ratio at such
time for the then most recently concluded period of four
consecutive fiscal quarters of the Company exceeds 3.50:1.00, an
Event of Default (as defined in the Credit Agreement and Private
Placement Senior Notes) is triggered.
The Credit Agreement and Private Placement
Senior Notes were amended in Q2 2022 and now allow for the addition
of acquisition and integration costs up to 15% of Consolidated
EBITDA and the netting of up to $400M of Available Cash (Cash held
by US Subsidiaries).
(1) Represents Consolidated EBITDA as
defined in our Credit Agreement and Private Placement Senior Notes
and is calculated using the most recently concluded period of four
consecutive quarters.
Note: Total will not always foot due to
rounding.
(a) reflected in selling, general and
administrative expenses ("SG&A").
(b) reflected in cost of sales.
(c) reflected in restructuring, impairment
and other charges.
(d) reflected YTD gain of $0.2 million
from the sale of a building within the Electronics segment in the
first quarter of 2023. 2022 amount included $0.5 million gain from
the sale of a building within Transportation segment.
(e) reflected the tax impact associated
with the non-GAAP adjustments, and 2022 year-to-date amount
includes the one-time net benefit of $7.2 million that resulted
from the dissolution of one of the Company’s affiliates.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231031799481/en/
David Kelley 224-727-2535 dkelley@littelfuse.com
Grafico Azioni Littelfuse (NASDAQ:LFUS)
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Da Feb 2025 a Mar 2025
Grafico Azioni Littelfuse (NASDAQ:LFUS)
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