CTS Reports Second Quarter Results; Repatriates $50 Million Cash Under the American Jobs Creation Act of 2004.ELKHART Elkhart, city (1990 pop. 43,627), Elkhart co., N Ind., at the confluence of the Elkhart and St. Joseph rivers; settled 1824, inc. 1877. The city's status as a chief producer of band instruments began in 1875. , Ind IND Investigational new drug Therapeutics A status assigned by the FDA to a drug before allowing its use in humans, exempting it from premarketing approval requirements so that experimental clinical trials may be conducted. See Phase 1.2, 3 studies, Sponsorship. . -- CTS (1) (Clear To Send) The RS-232 signal sent from the receiving station to the transmitting station that indicates it is ready to accept data. Contrast with RTS. (2) (Common Type System) The data typing used in . Corporation (NYSE NYSE See: New York Stock Exchange :CTS) today announced second quarter 2005 revenues of $158.3 million, a 15% increase over the second quarter of 2004. 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 were $0.10, which included a negative $0.07 per share from repatriation-related tax expense and the reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its of certain tax reserves. This compares to second quarter 2004 diluted earnings per share of $0.18 which included a gain of $0.05 from the sale of excess Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. land. Sales growth was driven by the SMTEK acquisition, which closed January January: see month. 31, 2005, and strong growth in automotive products, partially offset by weaker EMS Ems, town, Germany Ems or Bad Ems (bät ĕms), town (1994 pop. 10,130), Rhineland-Palatinate, W Germany, on the Lahn River. sales in communications infrastructure and declining handset The part of the telephone that contains the speaker and the microphone. On a desktop phone, the part you hold in your hand is the handset. On a cellphone, the entire phone is the handset. See multihandset cordless and headset. component sales. "The SMTEK acquisition has clearly proven to be a very positive addition to the company, strengthening our competitive position and contributing significantly to sales and earnings growth," commented Donald Donald (Domnall, Domhnall, Dumhnuil, Dónall) is an anglicized version of a Scottish or Irish Gaelic personal name, containing the elements dumno "world" and val "rule", viz. "ruler of the world". Compare Dumnorix. Schwanz, CTS Chairman and Chief Executive Officer. Based on the first-half 2005 results and revised estimates Revised estimate The third estimate of GDP released about three months after the measurement period. for the balance of the year, the Company expects full-year 2005 sales to be in the range of $630 million to $680 million which is 19% to 28% over 2004. Earnings per share, excluding the second quarter tax adjustment impact of $0.07 per share, are now expected to be in the range of $0.62 to $0.68. General Comments: --Sales relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the acquired SMTEK business were $29.3 million in the second quarter compared to $23.2 million for two months in the first quarter. --The second quarter included a $4.5 million tax expense for repatriation Repatriation The process of converting a foreign currency into the currency of one's own country. Notes: If you are American, converting British Pounds back to U.S. dollars is an example of repatriation. of $50 million of our overseas cash under the American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Jobs Creation Act of 2004 and a $1.7 million tax benefit relating to the reversal of income tax reserves due to successful resolution of certain foreign jurisdiction tax issues. --Capital expenditures of $5.9 million were 1.9% of sales in the first half 2005. The Company expects full-year 2005 capital expenditures to be in the range of $16 - $20 million. --The company continues to generate strong free cash flow, with second quarter free cash flow of $10.8 million. --The company repurchased approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 322,000 shares of its stock in the second quarter for $3.7 million.
SECOND QUARTER RESULTS - SEGMENT INFORMATION
(Dollars in millions)
Second Quarter Second Quarter First Quarter
2005 2004 2005
---------------- --------------- ---------------
Net Segment Net Segment Net Segment
Sales Operating Sales Operating Sales Operating
Earnings Earnings Earnings
---------------- --------------- ---------------
Components & Sensors $66.5 $7.5 $68.2 $8.7 $64.2 $3.6
Electronics
Manufacturing
Services (EMS) 91.8 2.8 69.4 1.9 91.1 2.1
--------------- -------------- ---------------
Total $158.3 $10.3 $137.6 $10.6 $155.3 $5.7
=============== ============== ===============
Components & Sensors
Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before decreased $1.2 million from 2004. Note that second quarter 2004 operating earnings included a $2.7 million gain on the sale of excess Canadian land. The second quarter Components and Sensors sales increased from the first quarter of 2005 by $2.3 million, or 4%, reflecting improving demand in automotive products and communications markets. Segment operating earnings were improved over the first quarter as a result of the higher sales, product mix improvements and reduced headcount head count or head·count n. 1. The act of counting people in a particular group. 2. The number of people counted in this way. Noun 1. . EMS: EMS second quarter 2005 sales increased by $22.4 million, or 32%, from the second quarter of 2004, primarily from the SMTEK acquisition, partially offset by lower demand for communications infrastructure equipment. Segment operating earnings improved primarily from higher gross margins related to the former SMTEK business. The second quarter EMS revenues were $0.7 million, or 1%, above the 2005 first quarter sales. A full quarter of SMTEK sales contributed to increased revenues, partially offset by slower sales to the communications infrastructure equipment industry. Despite the lower quarter-over-quarter sales, EMS segment operating earnings increased $0.7 million primarily due to higher gross margins of the former SMTEK business. Conference Call As previously announced, the Company has scheduled a conference call on Thursday Thursday: see week. , July July: see month. 28, 2005 at 11:00 a.m. Eastern Daylight Time. Those interested in participating may dial 800-762-6067 (480-629-9566, if calling from outside the U.S.). No access code is needed. There will be a replay of the conference call available from 4:15 p.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT on July 28, 2005, through 12:59 a.m. EDT on August 5, 2005. The telephone number for the replay is 800-475-6701 (320-365-3844, if calling from outside the U.S.). The access code is 788889. There will also be a live audio webcast of the conference call, which can be accessed directly from the Web sites of CTS Corporation (www.ctscorp.com), StreetEvents (www.StreetEvents.com), Netscape (1) (Netscape Communications Corporation, Mountain View, CA, www.netscape.com) Part of America Online (AOL), Netscape specializes in Web software, including the Netscape Web browser. (www.netscape.com), CompuServe An online information service that provides access to the Internet, e-mail, instant messaging and an integrated contact list. Founded in 1969 as a timesharing service, CompuServe is one of the oldest online services, being the first to offer e-mail in 1979 and online chat a year later. (www.compuserve.com CompuServe's Internet domain address. When sending e-mail to a CompuServe customer via the Internet, the comma in the CompuServe account number is turned into a dot; for example, account 71020,1560 becomes 71020.1560@compuserve.com. ) and others. AOL (A division of Time Warner, Inc., New York, NY, www.aol.com) The world's largest online information service with access to the Internet, e-mail, chat rooms and a variety of databases and services. subscribers will have access through the Personal Finance section of AOL. About CTS CTS is a leading designer and manufacturer of electronic components and sensors and a provider of electronics manufacturing services Electronic manufacturing services (EMS) is term used for companies that design, test, manufacture, distribute and provide return/repair services for electronic component and assemblies for original equipment manufacturers (OEMs). (EMS) to OEMs in the automotive, computer, communications, medical and industrial markets. CTS manufactures products in 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. , 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. CTS' stock is traded on the NYSE under the ticker symbol Ticker SymbolAn arrangement of characters (usually letters) representing a particular security listed on an exchange or otherwise traded publicly. When a company issues securities to the public marketplace, it selects an available ticker symbol for its securities which investors "CTS." To find out more, visit the CTS Web site at www.ctscorp.com. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement This press release contains certain statements that are, or may be deemed 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 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. These forward-looking statements include, but are not limited to, statements regarding the business and strategic benefits of the SMTEK acquisition, any financial or other guidance, and all statements that are not based on historical fact, but rather reflect our current expectations concerning future results and events. We make certain assumptions when making forward-looking statements, any of which could prove inaccurate, including, but not limited to, statements about our future operating results and business plans. The ultimate correctness of these forward-looking statements is dependent upon a number of known and unknown risks and events, and is subject to various uncertainties and other factors that may cause our actual results, performance, or achievements to be different from any future results, performance, or achievements expressed or implied by these statements. For more detailed information on the risks and uncertainties associated with CTS' business activities, see our reports filed with the SEC. CTS undertakes no obligation to publicly update its forward-looking statements, whether as a result of market or industry changes, new information or future events.
CTS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - UNAUDITED
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
--------------------- ---------------------
July 3, June 27, July 3, June 27,
2005 2004 2005 2004
--------- --------- --------- ---------
Net sales $158,346 $137,624 $313,676 $259,771
Costs and
expenses:
Cost of
goods sold 126,054 108,707 253,169 206,245
Selling,
general and
administrative
expenses 17,697 16,622 35,614 31,499
Research and
development
expenses 4,567 4,673 9,354 9,557
Gain on sale
of assets (293) (3,006)(2) (453) (3,067)(2)
--------- --------- --------- ---------
Operating
earnings 10,321 10,628 15,992 15,537
Other
expenses
(income):
Interest
expense 1,582 1,590 3,299 3,123
Other (70) 168 (515) 184
--------- --------- --------- ---------
Total
other
expenses 1,512 1,758 2,784 3,307
--------- --------- --------- ---------
Earnings
before
income taxes 8,809 8,870 13,208 12,230
Income tax
expense 4,867(1) 1,973 5,879(1) 2,813
--------- --------- --------- ---------
Net earnings $3,942 $6,897 $7,329 $9,417
--------- --------- --------- ---------
Net earnings
per share:
Basic $0.11 $0.19 $0.20 $0.26
--------- --------- --------- ---------
Diluted $0.10(1) $0.18 (2),(3) $0.19 (1) $0.26 (2),(3)
--------- --------- --------- ---------
Cash
dividends
declared per
share $0.03 $0.03 $0.06 $0.06
Average
common
shares
outstanding:
Basic 36,621 35,986 36,508 35,971
Diluted 41,226 38,363 (3) 41,101 37,303 (3)
(1) Income tax expense and diluted earnings per share include a net
impact of $2.8 million and $0.07 per diluted share, respectively,
consisting of $4.5 million of expense relating to the repatriation
of foreign to the United States under the provisions of the
American Jobs Creation Act of 2004 and a $1.7 million benefit
relating to the reversal of income tax reserves due to the
successful resolution of tax issues in certain foreign
jurisdictions.
(2) The 2004 gain on sale of assets includes $2.7 million pre-tax, or
$2.1 million after-tax and $0.05 per diluted share, gain related
to the sale of excess land in Canada.
(3) Diluted earnings per share for 2004 were restated to reflect the
impact of adopting Emerging Issues Task Force (EITF) No. 04-08,
"The Effect of Contingently Convertible Debt on Diluted Earnings
Per Share." EITF No. 04-08 was issued and became effective in the
fourth quarter of 2004 and accordingly, earlier were restated to
show diluted earnings per share computed on a consistent basis.
CTS Corporation and Subsidiaries
Condensed Consolidated Balance Sheets- Unaudited
(In thousands of dollars)
July 3, December
2005 31, 2004(a)
------------ ------------
Cash and cash equivalents $14,194 $61,005
Accounts receivable, net 89,603 84,112
Inventories, net 58,549 42,734
Other current assets 23,808 16,295
------------ ------------
Total current assets 186,154 204,146
------------ ------------
Property, plant & equipment, net 112,445 112,495
Other assets 242,300 205,536
------------ ------------
Total Assets $540,899 $522,177
============ ============
Notes payable and current portion
of long-term debt $3,302 $3,311
Accounts payable 70,044 55,614
Other accrued liabilities 43,549 44,036
------------ ------------
Total current liabilities 116,895 102,961
------------ ------------
Long-term debt 85,602 94,150
Other obligations 15,694 14,362
Shareholders' equity 322,708 310,704
Total Liabilities and
------------ ------------
Shareholders' Equity $540,899 $522,177
============ ============
(a) The balance sheet at December 31, 2004 has been derived from the
audited financial statements at that date.
CTS CORPORATION AND SUBSIDIARIES
OTHER SUPPLEMENTAL INFORMATION
(In thousands of dollars)
The following table summarizes free cash flow for the Company:
Three Months Ended
July 3, April 3,
2005 2005
----------------------
(In thousands of
dollars)
Net cash provided by (used in) operations $13,725 $10,875
Capital expenditures (2,907) (3,004)
----------- ----------
Free cash flow $10,818 $7,871
=========== ==========
Free cash flow is a non-GAAP financial measure which CTS defines as
the sum of net cash provided by operations and cash used for capital
expenditures. The most directly comparable GAAP financial measure is
net cash provided by operations. Management believes that free cash
flow provides useful information to investors regarding the Company's
ability to generate cash from business operations that was used and/or
is available for internal growth, service of debt principal,
dividends, share repurchase and acquisitions and other investments.
Management uses free cash flow as one measure to monitor and evaluate
the performance of the Company.
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion