Berg Electronics posts 12.4% sales gain; earnings before extraordinary items jump 37.5%.ST. LOUIS--(BUSINESS WIRE)--April 30, 1996--Berg Electronics Corp. (NYSE NYSE See: New York Stock Exchange :BEI Bei (pā, bā), river, c.200 mi (320 km) long, formed by the union of two headstreams in the Nanling Mts., N Guangdong prov., S China. It flows S into the Xi River, E of Guangzhou, to form the Pearl River delta. ), the world's fourth largest supplier of electrical connector, socket and cable assembly products, today reported strong sales and earnings growth for the first quarter of 1996 - its first financial reporting period since becoming a public company March 1, 1996. Management attributed the rise in sales primarily to new product introductions, the strength of key strategic accounts and the companys global selling approach. The surge in earnings before extraordinary items was the result of increased sales, improved margins and reduced interest expense. First Quarter Results For the quarter ended March 31, 1996, the company reported sales of $180.1 million, up 12.4 percent over the $160.3 million recorded for the first quarter of 1995. Earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
Earnings before extraordinary charges related to the companys recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. and before charges for preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. requirements was $5.6 million for the quarter, up 37.5 percent over the $4.0 million a year ago. Earnings applicable to common shares, after extraordinary items and all preferred stock charges, amounted to a net loss of $40.4 million for the first quarter of 1996 compared with first quarter net income of $498,000 in 1995. First quarter operating results were ahead of analysts projections. The extraordinary items associated with the recapitalization plan were as described in the IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. prospectus and met managements projections. To facilitate comparison, earnings per share data have been reported on both a GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). weighted average basis and a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis to reflect the application of proceeds of the IPO and 7.5 million increase in shares outstanding as a result of the companys IPO. Nineteen ninety-six first quarter income, before extraordinary items and preferred share requirements, was $0.36 per share (GAAP), or $0.30 per share pro forma; these figures compare with $0.31 per share (GAAP) and $0.18 per share pro forma recorded for the same quarter in 1995. Earnings applicable to common shares, after extraordinary items and charges related to preferred stock, resulted in a first quarter loss of $2.61 per share (GAAP), or pro forma net income of $0.30 per share in 1996, versus first quarter net income of 4 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. (GAAP) and $0.18 per share pro forma in 1995. The weighted average shares outstanding in the first quarter 1996, for GAAP purposes, were 15.5 million versus 13.0 million during the same period 1995. The pro forma shares outstanding for the first quarter of both years were 20.5 million. On an after tax basis for the quarter just ended, the company expensed, as an extraordinary item, $18.7 million in interest charges and redemption requirements paid 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. In addition, the company incurred charges of $27.3 million for accretion, dividend and redemption premiums on the repurchase of preferred stock. In a series of transactions between March 1 and April 9, 1996, 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 7.5 million common shares sold and from a new credit facility funded the payoff of (i) the previous credit facility; (ii) the redemption of all subordinated debentures, and (iii) the redemption of all preferred stock, plus all costs related to the transactions. The purpose of the company's recapitalization is to reduce interest expense and preferred stock dividend requirements and to improve operating and financial flexibility. Geographically, North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. accounted for almost 55 percent of consolidated sales in the first quarter of 1996, 16.7 percent ahead of the same period last year. European billings were flat compared to 1995, and represented approximately 23 percent of revenues. Sales in Asia amounted to 22 percent of consolidated sales in the quarter, up 14.2 percent. Currency translations had minimal impact on net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight during the quarter just ended. Management Comment Reflecting on the companys first quarter performance, James N. Mills, chairman of the board and chief executive officer, stated, "During the quarter, Berg benefited from sales gains in excess of the connector industry. A key to this success is our continuous commitment -- at all management levels -- to stay in close contact with customers to uncover and satisfy their business needs. By following this practice, we identified numerous opportunities to pursue. "The quarter yielded additional bright spots, both in terms of geography and products segments," Mills continued. "North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. sales were exceptionally strong because of telco infrastructure sales. Recent passage of the telecommunications bill should spur the communications and allied industries to move ahead with long delayed equipment and service plans - all of which could contribute to continued strong results in North America. "From a competitive and technical capabilities perspective, Berg holds a preeminent position in the marketplace. An example of what accounts for this reputation, is our new Double Deck DIMM (Dual In-Line Memory Module) A printed circuit board that holds memory chips and plugs into a DIMM socket on the motherboard. See memory module. DIMM - Dual In-Line Memory Module --a tight- tolerance, fine-pitch, in-line memory connector. Development of this product during the first quarter has further defined and differentiated Berg Electronics as a leader in next-generation connectors. Already our Japanese competitors have abandoned the double deck market due to the complexity of the connector and their inability to mass produce it within the necessary tolerances," Mills added. Operationally Bergs management continues to focus on cost reductions and operating performance improvements as evidenced by current and in-progress projects in Mexico, the Peoples Republic of China, the United Kingdom and Huntingdon County, Pennsylvania Huntingdon County is a county located in the U.S. state of Pennsylvania. In 2000, its population was 45,586. Huntingdon County was created on September 20, 1787 from part of Bedford County. Its county seat is Huntingdon6. Geography According to the U.S. . Each of these efforts is squarely aimed at meeting customer demand for delivery speed, reduced product In model theory, a branch of mathematical logic, the reduced product is a construction that generalizes both direct product and ultraproduct. cost and high product quality. Berg Electronics Corp. is the fourth largest worldwide supplier of connector, socket and cable assembly products with 1995 sales of $667 million. The companys broad range of products serve high-end data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a , personal computing Refers to users working on their own computers rather than a terminal to a mainframe. Sometimes, the term refers to using computers at home for work and/or entertainment in contrast to business use only. See personal computer. , all segments of telecommunications, industrial and instrumentation markets. Headquartered in St. Louis, Mo., USA, Berg Electronics employs more than 5,400 people worldwide at its 19 manufacturing and research facilities, which are strategically located in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , the Netherlands, France, Japan, Taiwan, Singapore, China, Korea, Mexico and India. The companys stock trades on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. under the symbol BEI. -0-
FINANCIAL HIGHLIGHTS TO FOLLOW
BERG ELECTRONICS CORP.
CONDENSED STATEMENTS OF CONSOLIDATED EARNINGS
(UNAUDITED)
($ in thousands, except per share data)
ACTUAL PRO FORMA
Three Months Ended Three Months Ended
March 31, March 31,
1996 1995 1996(a) 1995(b)
Net Sales $180,118 $160,300 $180,118 $160,300
Operating expenses:
Cost of goods sold (118,204) (105,816) (118,204) (105,816)
Other (44,457) (39,971) (44,457) (39,971)
Operating income 17,457 14,513 17,457 14,513
Other income (expense):
Interest expense (7,830) (8,768) (7,291) (7,551)
Amortization of deferred
financing costs (1,256) (1,600) (718) (699)
Other, net 886 2,588 886 -
Income tax expense (3,702) (2,693) (4,133) (2,505) Income before extraordinary items and preferred stock requirements 5,555 4,040 6,201 3,758 Extraordinary items, net of tax (18,664) - - - Net (loss) income (13,109) 4,040 6,201 3,758 Preferred stock requirements (27,335) (3,542) - - Net (loss) income applicable to common shares $(40,444) $498 $6,201 $3,758 Net (loss) income per share: Before extraordinary items $(1.40) $0.04 $0.30 $0.18 After extraordinary items $(2.61) $0.04 $0.30 $0.18 Shares outstanding 15,510,324 12,988,771 20,471,038 20,471,038
(a) 1996 pro forma presents results as if the IPO and
refinancing had been effective at December 31, 1995.
(b) 1995 pro forma presents results: (i) as if the IPO and
refinancing had been effective at December 31, 1994; (ii) excluding
the effects of an unusual currency gain of $2,588 in the first
quarter of 1995 and (iii) including the tax effects of (i) and (ii)
at an assumed rate of 40%. Had the currency gain not been excluded,
pro forma net income and EPS would be $5,311 and $0.26, respectively.
CONTACT: BERG Electronics Corp., St. Louis Gary D. Strong, 314/746-2235 |
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