2005 Second Quarter and Six Months Record Results and Announcement of Refinancing Reported by Amphenol Corporation.WALLINGFORD Wallingford, town (1990 pop. 40,822), New Haven co., S Conn.; inc. 1670. Its silverware industry dates from c.1835. Fruit growing and the manufacture of plastics, steel, precision instruments, and hardware are among the town's other industries. , Conn. -- Amphenol Amphenol Corporation (NYSE: APH) is a major producer of electronic and fiber optic connectors, cable and interconnect systems. Amphenol is a portmanteau from the corporation's original name, American Phenolic Corp. Corporation (NYSE-APH) reported today that second quarter 2005 diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of increased 29% to a record $.58 compared to $.45 per share for the comparable 2004 period. Sales for the second quarter 2005 increased 15% to $443,642,000 compared to $387,119,000 for the 2004 period. Currency translation had the effect of increasing sales by approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $7.5 million in the second quarter 2005 compared to the 2004 period. For the six months ended June June: see month. 30, 2005, diluted earnings per share was $1.09 compared to $.85 per share for the 2004 period. Sales for the six months ended June 30, 2005 were $853,037,000 compared to $742,380,000 for the 2004 period. Currency translation had the effect of increasing sales by approximately $15.2 million for the six month 2005 period when compared to the 2004 period. In addition, on July July: see month. 15, 2005 the Company completed a refinancing Refinancing An extension and/or increase in amount of existing debt. of its senior credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities . The new senior credit agreement consists of a $750 million unsecured Unsecured A loan or equity interest that is given without any guarantee of payment, performance, satisfaction or opportunity for return from the recipient. No property, interest or security is used as collateral in either a guarantee or a pledge. five year revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility, of which approximately $440 million was drawn at closing. The net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). from the refinancing were used to repay all amounts outstanding under the Company's previous senior secured credit facilities and for working capital purposes. In conjunction therewith there·with adv. 1. With that, this, or it. 2. In addition to that. 3. Archaic Immediately thereafter. Adv. 1. , the Company incurred one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. expenses for the early extinguishment The destruction or cancellation of a right, a power, a contract, or an estate. Extinguishment is sometimes confused with merger, though there is a clear distinction between them. of debt totaling approximately $2.5 million (before tax benefit of $.8 million) or $.02 per share after tax. Such one-time expenses will be reported in the third quarter and include the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of unamortized deferred debt issuance costs less the gain on the termination The point where a line, channel or circuit ends. See SCSI termination and hybrid. of related interest rate swap Interest Rate Swap A deal between banks or companies where borrowers switch floating-rate loans for fixed rate loans in another country. These can be either the same or different currencies. agreements. Amphenol Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , Martin H. Loeffler, stated: "I am extremely pleased with our second quarter results. Sales were up 15% compared to last year's second quarter to a record $443,642,000. The operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. margin increased from 17.8% to 19.4%. The interconnect (1) To attach one device to another. (2) A physical port (plug, socket) or wireless port (transmitter, receiver) used to attach one device to another. products segment of our business, which represents 88% of our sales, was up a strong 16% over last year with excellent profitability. The growth was broad based across all of our end markets and included all major geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. regions. Growth was especially strong in the wireless infrastructure, industrial and military and aerospace markets. The excellent top line results reflect our continuing development of new application specific solutions and value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. products for our customers, our increased worldwide presence with the leading companies in our target markets and acquisitions. The improved profitability in the interconnect business is also attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the continuing development of new application specific products as well as higher volumes and ongoing programs of cost control. The cable products segment of our business, which is primarily for broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). cable television networks and represents 12% of our sales, was up 7% over the prior year." "In addition to excellent overall top line growth, profitability and cash flow continued to be strong. Earnings per share for the quarter were up 29% over last year, representing the fourteenth consecutive quarterly increase and a new record for the Company. Furthermore, net income, that is income after interest expense and taxes, exceeded 11% of sales, another indication of the Company's excellent profitability. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses was also strong at $49 million for the quarter." "In addition, in May, the Company completed the acquisition of a United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. manufacturer of radio frequency interconnect products for military and aerospace related markets. The Company has annual sales of approximately $20 million. Including this most recent acquisition, the Company has completed four acquisitions since the beginning of the year. We are excited about the growth opportunities presented by these excellent additions." "We are also pleased to have completed the debt refinancing. The new five year facility is unsecured and has improved pricing in recognition of the Company's strong operating performance, substantial deleveraging and the achievement of an investment grade credit rating from a major rating agency. In addition, the new facility will provide significantly increased flexibility to pursue additional opportunities to expand and grow our business." "It was a good quarter in all respects. I am very proud of our organization as we continue to execute well. We have a strong position in excellent and diversified diversified (di·verˑ·s markets and continue to increase our presence with the major companies in these markets. Assuming a continuation continuation - continuation passing style of the current economic climate and relatively stable currency exchange rates, we are revising upward our expectation for full year 2005 results to a sales increase in the range of 13% to 15% and earnings per share increase in the range of 23% to 26%; this compares to our prior estimates of sales and earnings per share increases of 11% to 14% and 20% to 25%, respectively. We expect third quarter results in the range of $435 million to $445 million and $.56 to $.58 for sales and EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. respectively. This guidance excludes the impact in the third quarter of 2005 of one-time expenses associated with the refinancing of $.02 per share. We are very confident that we are in excellent markets with a great organization, and we are very excited about the future." The Company will host a conference call to discuss its second quarter results at 1:00 PM (ET) July 20, 2005. The toll free dial-in number to participate in this call is 888-395-9624; International dial-in number 517-623-4547; Passcode: Reardon. There will be a replay available until 5:00 PM (ET) on Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , July 22, 2005. If you are unable to participate on the call the replay numbers are as follows: the toll free dial-in number is 800-759-4401 and International dial-in replay number is 203-369-3418 A live broadcast as well as a replay will also be available on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the 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 optic /op·tic/ (op´tik) ocular (1). op·tic or op·ti·cal adj. 1. Of or relating to the eye or vision. 2. connectors, cable and interconnect systems. Amphenol products are engineered and manufactured in the Americas A·mer·i·cas , the See America. , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and Asia and sold by a worldwide sales and marketing
organization. The primary end markets for the Company's products
are communication systems for the converging con·verge v. con·verged, con·verg·ing, con·verg·es v.intr. 1. a. To tend toward or approach an intersecting point: lines that converge. b. technologies of voice, video and data communications data communications, application of telecommunications technology to the problem of transmitting data, especially to, from, or between computers. In popular usage, it is said that data communications make it possible for one computer to "talk" with another. , industrial/automotive and military/aerospace applications. Statements in this press release which are other than historical facts are intended to be "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Securities Exchange Act of 1934, the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and 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 1 of the Company's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December December: see month. 31, 2004, 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
FINANCIAL SUMMARY
-----------------
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2005 2004(1) 2005 2004(1)
Sales $443,642,000 $387,119,000 $853,037,000 $742,380,000
Net income $ 52,056,000 $ 40,367,000 $ 98,432,000 $ 76,025,000
Earnings per share
- basic $ .59 $ .46 $ 1.12 $ .86
Average shares
outstanding
- basic 88,362,802 89,174,604 88,190,725 88,076,203
Earnings per share
- diluted $ .58 $ .45 $ 1.09 $ .85
Average shares
outstanding
- diluted 90,272,291 89,864,734 90,089,494 89,871,449
1. Per share and share amounts have been adjusted to reflect the
Company's 2 for 1 stock split effective in March 2004.
AMPHENOL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(dollars in thousands, except per share data)
Three months ended Six months ended
June 30, June 30,
-----------------------------------------------
2005 2004 2005 2004
----------- ----------- ----------- -----------
Net Sales $ 443,642 $ 387,119 $ 853,037 $ 742,380
Costs and Expenses:
Cost of sales,
excluding depreciation
and amortization 282,421 254,031 545,846 487,261
Depreciation and
amortization
expense 12,699 9,733 23,513 19,166
Selling, general and
administrative
expense 62,476 54,301 120,299 105,616
----------- ----------- ----------- -----------
Operating income 86,046 69,054 163,379 130,337
Interest expense (5,775) (5,673) (11,178) (11,428)
Other expenses, net (1,398) (2,219) (3,062) (3,719)
----------- ----------- ----------- -----------
Income before income
taxes 78,873 61,162 149,139 115,190
Provision for income
taxes (26,817) (20,795) (50,707) (39,165)
----------- ----------- ----------- -----------
Net income $ 52,056 $ 40,367 $ 98,432 $ 76,025
=========== =========== =========== ===========
Net income per common
share - Basic $ 0.59 $ 0.46 $ 1.12 $ 0.86
=========== =========== =========== ===========
Average shares
outstanding - Basic 88,362,802 88,174,604 88,190,725 88,076,203
=========== =========== =========== ===========
Net income per common
share - Diluted $ 0.58 $ 0.45 $ 1.09 $ 0.85
=========== =========== =========== ===========
Average shares
outstanding
- Diluted 90,272,291 89,864,734 90,089,494 89,871,449
=========== =========== =========== ===========
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
June 30, Dec. 31,
2005 2004
---------- ----------
(Unaudited)
ASSETS
Current Assets:
Cash and short-term cash investments $ 25,462 $ 30,172
Accounts receivable, less allowance
for doubtful accounts of $8,868 and
$8,666, respectively 232,819 214,158
Inventories 268,811 247,303
Prepaid expenses and other assets 41,459 37,382
---------- ----------
Total current assets 568,551 529,015
Land and depreciable assets, less
accumulated depreciation of
$345,311 and $349,255, respectively 207,565 197,753
Deferred debt issuance costs 5,722 6,451
Goodwill 640,393 545,411
Deferred taxes and other assets 28,683 28,081
---------- ----------
$1,450,914 $1,306,711
========== ==========
LIABILITIES & SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 150,131 $ 134,856
Accrued interest 2,022 2,183
Accrued salaries, wages and employee
benefits 37,451 38,535
Other accrued expenses 66,255 85,089
Dividends payable 2,705 -
Current portion of long-term debt 18,993 16,909
---------- ----------
Total current liabilities 277,557 277,572
Long-term debt 458,412 432,144
Accrued pension and post employment
benefit obligations 100,914 102,050
Other liabilities 32,023 13,341
Shareholders' Equity:
Common stock 88 88
Additional paid-in deficit (183,584) (207,504)
Accumulated earnings 882,825 789,741
Accumulated other comprehensive loss (66,955) (55,078)
Treasury stock, at cost (50,366) (45,643)
---------- ----------
Total shareholders' equity 582,008 481,604
---------- ----------
$1,450,914 $1,306,711
========== ==========
AMPHENOL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited)
(dollars in thousands)
Six months ended
June 30,
--------------------
2005 2004
---------- ---------
Net income $ 98,432 $ 76,025
Adjustments for cash from operations:
Depreciation and amortization 23,513 19,166
Amortization of deferred debt issue costs 729 711
Net change in non-cash components of
working capital (41,234) (22,295)
Other long term assets and liabilities 6,257 6,315
--------- --------
Cash provided by operations 87,697 79,922
--------- --------
Cash flow from investing activities:
Capital additions, net (27,913) (18,513)
Investments in acquisitions (100,178) (1,943)
--------- --------
Cash flow used by investing activities (128,091) (20,456)
--------- --------
Cash flow from financing activities:
Net change in borrowings under revolving
credit facilities 28,007 (4,065)
Decrease in borrowings under Bank Agreement (2,000) (61,000)
Purchase of treasury stock (4,723) (16,174)
Proceeds from exercise of stock options
including tax benefit 17,043 16,867
Dividend payments (2,643) -
--------- --------
Cash flow provided by (used by) financing
activities 35,684 (64,372)
--------- --------
Net change in cash and short-term
cash investments (4,710) (4,906)
Cash and short-term cash investments
balance, beginning of period 30,172 23,533
--------- --------
Cash and short-term cash investments
balance, end of period $ 25,462 $ 18,627
========= ========
Net cash paid during the year for:
----------------------------------
Interest 10,611 11,240
Taxes 48,384 26,560
AMPHENOL CORPORATION
SEGMENT INFORMATION
(In thousands)
(Unaudited)
Three months ended Six months ended
June 30, June 30,
------------------- -------------------
2005 2004 2005 2004
--------- --------- --------- ---------
Trade Sales:
Interconnect Products $389,163 $336,362 $750,318 $647,035
Cable Products 54,479 50,757 102,719 95,345
--------- --------- --------- ---------
Consolidated $443,642 $387,119 $853,037 $742,380
========= ========= ========= =========
Operating income:
Interconnect Products $ 85,327 $ 68,283 $161,118 $128,883
Cable Products 7,044 5,927 13,219 11,338
Corporate (6,325) (5,156) (10,958) (9,884)
--------- --------- --------- ---------
Consolidated $ 86,046 $ 69,054 $163,379 $130,337
========= ========= ========= =========
ROS%:
Interconnect Products 21.9% 20.3% 21.5% 19.9%
Cable Products 12.9% 11.7% 12.9% 11.9%
Consolidated 19.4% 17.8% 19.2% 17.6%
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