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Belden Reports Third Quarter Results

Belden Inc. (NYSE: BDC) (the “Company”), a leading global supplier of network infrastructure and digitization solutions, today reported fiscal third quarter results for the period ended October 1, 2023.

Third Quarter 2023 Highlights

  • Revenues of $627 million, -7% y/y and Organic Growth of -9% y/y
  • GAAP EPS of $1.70, -28% y/y and Adjusted EPS of $1.78, +1% y/y
  • Executed $64 million of share repurchases during the quarter, and $150 million year to date

"During the third quarter, as previously communicated, weak demand across our markets presented challenges, yet our expanding solutions-driven mix drove gross margin outperformance," said Ashish Chand, President and CEO of Belden Inc. "As we look ahead, we expect the challenges that have emerged to persist into the fourth quarter and most likely into the coming year. We will mitigate temporary demand weakness by taking productivity measures to better align with these expected conditions. With continued focus on our solutions business, we aim to not only capture share and support better margins but to further strengthen our robust foundation for sustainable long-term growth."

Third Quarter 2023

Revenues for the quarter were $627 million, compared to $670 million in the year-ago period. Organic year-over-year growth for the quarter was off 9%, with Industrial Automation Solutions and Enterprise Solutions down 4% and 14%, respectively. Net income was $72 million, compared to $104 million in the year-ago period. Prior year net income included a pre-tax gain on sale of assets of $38 million compared to $12 million this year. Net income as a percentage of revenue was 11.5%, compared to 15.5% in the year-ago period. EPS totaled $1.70 for the quarter, compared to $2.35 in the year-ago period.

Adjusted EBITDA was $115 million, compared to $118 million in the year-ago period. Adjusted EBITDA margins expanded 80bps to 18.4%, compared to 17.6% in the year-ago period. Adjusted EPS was $1.78, increasing 1% compared to $1.77 in the year-ago period. Adjusted results are non-GAAP measures, and a non-GAAP reconciliation table is provided as an appendix to this release.

Outlook

The fourth quarter is expected to be marked by ongoing demand headwinds, pauses in capital spending by customers, and channel destocking pressures. In the long term, the secular trends driving our business – automation, smart infrastructure, and data integration - remain intact, and Belden is uniquely positioned to provide market-leading digitization solutions. We expect to weather these temporary headwinds and surpass our prior revenue run rates as we increase our product and solution offerings, expand into additional use cases and verticals, and gain share with our solutions go-to-market strategy.

Assuming no significant changes to the current market environment, the table below provides guidance for the fourth quarter of 2023.

Fourth Quarter 2023:

 

 

 

 

Guidance

Revenues (million)

 

$510 - $530

GAAP EPS

 

$0.49 - $0.64

Adjusted EPS

 

$1.05 - $1.20

Earnings Conference Call

Management will host a conference call today at 8:30 am ET to discuss the results. The listen-only audio of the conference call will be broadcast live via the Internet at https://investor.belden.com. The dial-in number for participants is 888-394-8218 with confirmation code 6123821. A replay of this conference call will remain accessible in the investor relations section of the Company’s website for a limited time.

Net Income, Earnings per Share (EPS), and Organic Growth

All references to net income and EPS within this earnings release refer to income from continuing operations and income from continuing operations per diluted share attributable to Belden stockholders, respectively. Organic growth is calculated as the change in revenues excluding the impacts from currency exchange rates, copper prices, acquisitions and divestitures.

 
 
 

BELDEN INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)
 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

October 1,

2023

 

October 2,

2022

 

October 1,

2023

 

October 2,

2022

 

 

 

 

 

 

 

 

 

 

 

(In thousands, except per share data)

Revenues

 

$

626,807

 

 

$

670,491

 

 

$

1,960,841

 

 

$

1,947,413

 

Cost of sales

 

 

(385,639

)

 

 

(431,845

)

 

 

(1,212,240

)

 

 

(1,277,602

)

Gross profit

 

 

241,168

 

 

 

238,646

 

 

 

748,601

 

 

 

669,811

 

Selling, general and administrative expenses

 

 

(118,079

)

 

 

(110,478

)

 

 

(366,288

)

 

 

(318,747

)

Research and development expenses

 

 

(30,190

)

 

 

(26,306

)

 

 

(90,544

)

 

 

(75,751

)

Amortization of intangibles

 

 

(9,526

)

 

 

(10,105

)

 

 

(30,262

)

 

 

(28,099

)

Gain on sale of assets

 

 

12,056

 

 

 

37,891

 

 

 

12,056

 

 

 

37,891

 

Operating income

 

 

95,429

 

 

 

129,648

 

 

 

273,563

 

 

 

285,105

 

Interest expense, net

 

 

(8,580

)

 

 

(9,883

)

 

 

(25,593

)

 

 

(35,570

)

Non-operating pension benefit

 

 

328

 

 

 

26

 

 

 

1,462

 

 

 

2,296

 

Loss on debt extinguishment

 

 

 

 

 

 

 

 

 

 

 

(6,392

)

Income from continuing operations before taxes

 

 

87,177

 

 

 

119,791

 

 

 

249,432

 

 

 

245,439

 

Income tax expense

 

 

(14,850

)

 

 

(16,104

)

 

 

(45,385

)

 

 

(39,014

)

Income from continuing operations

 

 

72,327

 

 

 

103,687

 

 

 

204,047

 

 

 

206,425

 

Loss from discontinued operations, net of tax

 

 

 

 

 

 

 

 

 

 

 

(3,685

)

Loss on disposal of discontinued operations, net of tax

 

 

 

 

 

(5,366

)

 

 

 

 

 

(9,933

)

Net income

 

 

72,327

 

 

 

98,321

 

 

 

204,047

 

 

 

192,807

 

Less: Net income (loss) attributable to noncontrolling interest

 

 

(20

)

 

 

27

 

 

 

(245

)

 

 

111

 

Net income attributable to Belden stockholders

 

$

72,347

 

 

$

98,294

 

 

$

204,292

 

 

$

192,696

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares and equivalents:

 

 

 

 

 

 

 

 

Basic

 

 

42,053

 

 

 

43,466

 

 

 

42,460

 

 

 

44,181

 

Diluted

 

 

42,625

 

 

 

44,063

 

 

 

43,129

 

 

 

44,810

 

 

 

 

 

 

 

 

 

 

Basic income (loss) per share attributable to Belden stockholders:

 

 

 

 

 

 

 

 

Continuing operations

 

$

1.72

 

 

$

2.38

 

 

$

4.81

 

 

$

4.67

 

Discontinued operations

 

 

 

 

 

 

 

 

 

 

 

(0.08

)

Disposal of discontinued operations

 

 

 

 

 

(0.12

)

 

 

 

 

 

(0.22

)

Net income

 

$

1.72

 

 

$

2.26

 

 

$

4.81

 

 

$

4.36

 

 

 

 

 

 

 

 

 

 

Diluted income (loss) per share attributable to Belden stockholders:

 

 

 

 

 

 

 

 

Continuing operations

 

$

1.70

 

 

$

2.35

 

 

$

4.74

 

 

$

4.60

 

Discontinued operations

 

 

 

 

 

 

 

 

 

 

 

(0.08

)

Disposal of discontinued operations

 

 

 

 

 

(0.12

)

 

 

 

 

 

(0.22

)

Net income

 

$

1.70

 

 

$

2.23

 

 

$

4.74

 

 

$

4.30

 

 

 

 

 

 

 

 

 

 

Common stock dividends declared per share

 

$

0.05

 

 

$

0.05

 

 

$

0.15

 

 

$

0.15

 

 
 
 
 

BELDEN INC.

OPERATING SEGMENT INFORMATION

(Unaudited)
 

 

 

 

Enterprise

Solutions

 

Industrial

Automation

Solutions

 

Total

Segments

 

 

 

 

 

 

 

 

(In thousands, except percentages)

 

 

 

 

 

 

 

For the three months ended October 1, 2023

 

 

 

 

 

 

Segment Revenues

 

$

283,905

 

 

$

342,902

 

 

$

626,807

 

Segment EBITDA

 

 

37,693

 

 

 

77,244

 

 

 

114,937

 

Segment EBITDA margin

 

 

13.3

%

 

 

22.5

%

 

 

18.3

%

Depreciation expense

 

 

6,632

 

 

 

6,810

 

 

 

13,442

 

Amortization of intangibles

 

 

4,468

 

 

 

5,058

 

 

 

9,526

 

Amortization of software development intangible assets

 

 

 

 

 

1,963

 

 

 

1,963

 

Severance, restructuring, and acquisition integration costs

 

 

3,453

 

 

 

2,622

 

 

 

6,075

 

Adjustments related to acquisitions and divestitures

 

 

197

 

 

 

298

 

 

 

495

 

 

 

 

 

 

 

 

For the three months ended October 2, 2022

 

 

 

 

 

 

Segment Revenues

 

$

319,201

 

 

$

351,290

 

 

$

670,491

 

Segment EBITDA

 

 

46,110

 

 

 

71,055

 

 

 

117,165

 

Segment EBITDA margin

 

 

14.4

%

 

 

20.2

%

 

 

17.5

%

Depreciation expense

 

 

6,020

 

 

 

5,827

 

 

 

11,847

 

Amortization of intangibles

 

 

4,512

 

 

 

5,593

 

 

 

10,105

 

Amortization of software development intangible assets

 

 

8

 

 

 

860

 

 

 

868

 

Severance, restructuring, and acquisition integration costs

 

 

2,702

 

 

 

1,858

 

 

 

4,560

 

Adjustments related to acquisitions and divestitures

 

 

(2,537

)

 

 

514

 

 

 

(2,023

)

 

 

 

 

 

 

 

For the nine months ended October 1, 2023

 

 

 

 

 

 

Segment Revenues

 

$

871,777

 

 

$

1,089,064

 

 

$

1,960,841

 

Segment EBITDA

 

 

118,854

 

 

 

229,662

 

 

 

348,516

 

Segment EBITDA margin

 

 

13.6

%

 

 

21.1

%

 

 

17.8

%

Depreciation expense

 

 

18,779

 

 

 

19,699

 

 

 

38,478

 

Amortization of intangibles

 

 

15,171

 

 

 

15,091

 

 

 

30,262

 

Amortization of software development intangible assets

 

 

 

 

 

5,235

 

 

 

5,235

 

Severance, restructuring, and acquisition integration costs

 

 

5,147

 

 

 

6,699

 

 

 

11,846

 

Adjustments related to acquisitions and divestitures

 

 

522

 

 

 

520

 

 

 

1,042

 

 

 

 

 

 

 

 

For the nine months ended October 2, 2022

 

 

 

 

 

 

Segment Revenues

 

$

895,075

 

 

$

1,052,338

 

 

$

1,947,413

 

Segment EBITDA

 

 

118,818

 

 

 

206,643

 

 

 

325,461

 

Segment EBITDA margin

 

 

13.3

%

 

 

19.6

%

 

 

16.7

%

Depreciation expense

 

 

17,214

 

 

 

17,229

 

 

 

34,443

 

Amortization of intangibles

 

 

13,051

 

 

 

15,048

 

 

 

28,099

 

Amortization of software development intangible assets

 

 

52

 

 

 

2,804

 

 

 

2,856

 

Severance, restructuring, and acquisition integration costs

 

 

7,605

 

 

 

6,535

 

 

 

14,140

 

Adjustments related to acquisitions and divestitures

 

 

(3,095

)

 

 

1,648

 

 

 

(1,447

)

 
 
 
 

BELDEN INC.

OPERATING SEGMENT RECONCILIATION TO CONSOLIDATED RESULTS

(Unaudited)
 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

October 1,

2023

 

October 2,

2022

 

October 1,

2023

 

October 2,

2022

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Total Segment and Consolidated Revenues

 

$

626,807

 

 

$

670,491

 

 

$

1,960,841

 

 

$

1,947,413

 

 

 

 

 

 

 

 

 

 

Total Segment EBITDA

 

$

114,937

 

 

$

117,165

 

 

$

348,516

 

 

$

325,461

 

Total non-operating pension benefit

 

 

328

 

 

 

26

 

 

 

1,462

 

 

 

2,296

 

Non-operating pension settlement loss

 

 

 

 

 

954

 

 

 

 

 

 

954

 

Eliminations

 

 

(63

)

 

 

(51

)

 

 

(146

)

 

 

(156

)

Consolidated Adjusted EBITDA (1)

 

$

115,202

 

 

$

118,094

 

 

$

349,832

 

 

$

328,555

 

Depreciation expense

 

 

(13,442

)

 

 

(11,847

)

 

 

(38,478

)

 

 

(34,443

)

Amortization of intangibles

 

 

(9,526

)

 

 

(10,105

)

 

 

(30,262

)

 

 

(28,099

)

Interest expense, net

 

 

(8,580

)

 

 

(9,883

)

 

 

(25,593

)

 

 

(35,570

)

Amortization of software development intangible assets

 

 

(1,963

)

 

 

(868

)

 

 

(5,235

)

 

 

(2,856

)

Adjustments related to acquisitions and divestitures

 

 

(495

)

 

 

2,023

 

 

 

(1,042

)

 

 

1,447

 

Severance, restructuring, and acquisition integration costs

 

 

(6,075

)

 

 

(4,560

)

 

 

(11,846

)

 

 

(14,140

)

Non-operating pension settlement loss

 

 

 

 

 

(954

)

 

 

 

 

 

(954

)

Loss on debt extinguishment

 

 

 

 

 

 

 

 

 

 

 

(6,392

)

Gain on sale of assets

 

 

12,056

 

 

 

37,891

 

 

 

12,056

 

 

 

37,891

 

Income from continuing operations before taxes

 

$

87,177

 

 

$

119,791

 

 

$

249,432

 

 

$

245,439

 

(1)

Consolidated Adjusted EBITDA is a non-GAAP measure. See Reconciliation of Non-GAAP Measures for additional information.

 
 
 
 

BELDEN INC.

CONDENSED CONSOLIDATED BALANCE SHEETS
 

 

 

 

October 1, 2023

 

December 31, 2022

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

(In thousands)

ASSETS

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

530,971

 

 

$

687,676

 

Receivables, net

 

 

481,125

 

 

 

440,102

 

Inventories, net

 

 

336,420

 

 

 

341,563

 

Other current assets

 

 

63,831

 

 

 

66,866

 

Total current assets

 

 

1,412,347

 

 

 

1,536,207

 

Property, plant and equipment, less accumulated depreciation

 

 

404,950

 

 

 

381,864

 

Operating lease right-of-use assets

 

 

78,497

 

 

 

73,376

 

Goodwill

 

 

892,711

 

 

 

862,253

 

Intangible assets, less accumulated amortization

 

 

271,615

 

 

 

246,830

 

Deferred income taxes

 

 

14,830

 

 

 

14,642

 

Other long-lived assets

 

 

54,449

 

 

 

46,503

 

 

 

$

3,129,399

 

 

$

3,161,675

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

 

 

 

 

Accounts payable

 

$

304,851

 

 

$

350,058

 

Accrued liabilities

 

 

248,320

 

 

 

289,861

 

Total current liabilities

 

 

553,171

 

 

 

639,919

 

Long-term debt

 

 

1,145,796

 

 

 

1,161,176

 

Postretirement benefits

 

 

65,063

 

 

 

67,828

 

Deferred income taxes

 

 

67,709

 

 

 

58,582

 

Long-term operating lease liabilities

 

 

65,477

 

 

 

59,250

 

Other long-term liabilities

 

 

32,780

 

 

 

30,970

 

Stockholders’ equity:

 

 

 

 

Common stock

 

 

503

 

 

 

503

 

Additional paid-in capital

 

 

812,423

 

 

 

825,669

 

Retained earnings

 

 

949,422

 

 

 

751,522

 

Accumulated other comprehensive loss

 

 

(6,605

)

 

 

(5,871

)

Treasury stock

 

 

(556,343

)

 

 

(428,812

)

Total Belden stockholders’ equity

 

 

1,199,400

 

 

 

1,143,011

 

Noncontrolling interests

 

 

3

 

 

 

939

 

Total stockholders’ equity

 

 

1,199,403

 

 

 

1,143,950

 

 

 

$

3,129,399

 

 

$

3,161,675

 

 
 
 
 

BELDEN INC.

CONDENSED CONSOLIDATED CASH FLOW STATEMENTS

(Unaudited)
 

 

 

 

Nine Months Ended

 

 

October 1, 2023

 

October 2, 2022

 

 

 

 

 

 

 

(In thousands)

Cash flows from operating activities:

 

 

 

 

Net income

 

$

204,047

 

 

$

192,807

 

Adjustments to reconcile net income to cash flows from operating activities:

 

 

 

 

Depreciation and amortization

 

 

73,974

 

 

 

65,730

 

Share-based compensation

 

 

14,843

 

 

 

18,438

 

Loss on disposal of discontinued operations

 

 

 

 

 

9,934

 

Loss on debt extinguishment

 

 

 

 

 

6,392

 

Gain on sale of assets

 

 

(12,056

)

 

 

(37,891

)

Changes in operating assets and liabilities, net of the effects of currency exchange rate changes, acquired businesses and disposals:

 

 

 

 

Receivables

 

 

(48,949

)

 

 

(42,808

)

Inventories

 

 

16,211

 

 

 

(11,393

)

Accounts payable

 

 

(42,456

)

 

 

(65,584

)

Accrued liabilities

 

 

(43,318

)

 

 

(41,247

)

Income taxes

 

 

548

 

 

 

(2,347

)

Other assets

 

 

(6,706

)

 

 

4,269

 

Other liabilities

 

 

3,855

 

 

 

(17,500

)

Net cash provided by operating activities

 

 

159,993

 

 

 

78,800

 

Cash flows from investing activities:

 

 

 

 

Cash used for business acquisitions, net of cash acquired

 

 

(106,712

)

 

 

(104,481

)

Capital expenditures

 

 

(61,870

)

 

 

(50,250

)

Proceeds from disposal of tangible assets

 

 

13,785

 

 

 

43,534

 

Proceeds from disposal of businesses, net of cash sold

 

 

9,300

 

 

 

334,574

 

Net cash provided by (used for) investing activities

 

 

(145,497

)

 

 

223,377

 

Cash flows from financing activities:

 

 

 

 

Payments under share repurchase program

 

 

(150,000

)

 

 

(136,336

)

Withholding tax payments for share-based payment awards

 

 

(17,309

)

 

 

(6,534

)

Cash dividends paid

 

 

(6,408

)

 

 

(6,762

)

Payments under financing lease obligations

 

 

(254

)

 

 

(123

)

Payments under borrowing arrangements

 

 

 

 

 

(230,639

)

Proceeds from issuance of common stock

 

 

6,568

 

 

 

3,717

 

Net cash used for financing activities

 

 

(167,403

)

 

 

(376,677

)

Effect of foreign currency exchange rate changes on cash and cash equivalents

 

 

(3,798

)

 

 

(21,791

)

Decrease in cash and cash equivalents

 

 

(156,705

)

 

 

(96,291

)

Cash and cash equivalents, beginning of period

 

 

687,676

 

 

 

643,757

 

Cash and cash equivalents, end of period

 

$

530,971

 

 

$

547,466

 

 

The Condensed Consolidated Cash Flow Statement for the nine months ended October 2, 2022 includes the results of discontinued operations up to the February 22, 2022 disposal date. 

 
 
 
 

BELDEN INC.

RECONCILIATION OF NON-GAAP MEASURES

(Unaudited)

In addition to reporting financial results in accordance with accounting principles generally accepted in the United States, we provide non-GAAP operating results adjusted for certain items, including: asset impairments; accelerated depreciation expense due to plant consolidation activities; purchase accounting effects related to acquisitions, such as the adjustment of acquired inventory to fair value, and transaction costs; severance, restructuring, and acquisition integration costs; gains (losses) recognized on the disposal of businesses and assets; amortization of intangible assets; gains (losses) on debt extinguishment; certain gains (losses) from patent settlements; discontinued operations; and other costs. We adjust for the items listed above in all periods presented, unless the impact is clearly immaterial to our financial statements. When we calculate the tax effect of the adjustments, we include all current and deferred income tax expense commensurate with the adjusted measure of pre-tax profitability.

We utilize the adjusted results to review our ongoing operations without the effect of these adjustments and for comparison to budgeted operating results. We believe the adjusted results are useful to investors because they help them compare our results to previous periods and provide important insights into underlying trends in the business and how management oversees our business operations on a day-to-day basis. As an example, we adjust for acquisition-related expenses, such as amortization of intangibles and impacts of fair value adjustments because they generally are not related to the acquired business' core business performance. As an additional example, we exclude the costs of restructuring programs, which can occur from time to time for our current businesses and/or recently acquired businesses. We exclude the costs in calculating adjusted results to allow us and investors to evaluate the performance of the business based upon its expected ongoing operating structure. We believe the adjusted measures, accompanied by the disclosure of the costs of these programs, provides valuable insight.

Adjusted results should be considered only in conjunction with results reported according to accounting principles generally accepted in the United States.

 

 

Three Months Ended

 

Nine Months Ended

 

 

October 1,

2023

 

October 2,

2022

 

October 1,

2023

 

October 2,

2022

 

 

 

 

 

 

 

 

 

 

 

(In thousands, except percentages and per share amounts)

GAAP and Adjusted Revenues

 

$

626,807

 

$

670,491

 

$

1,960,841

 

$

1,947,413

 

 

 

 

 

 

 

 

 

 

GAAP gross profit

 

$

241,168

 

 

$

238,646

 

 

$

748,601

 

 

$

669,811

 

Severance, restructuring, and acquisition integration costs

 

 

912

 

 

 

2,796

 

 

 

1,400

 

 

 

8,771

 

Amortization of software development intangible assets

 

 

1,963

 

 

 

868

 

 

 

5,235

 

 

 

2,856

 

Adjustments related to acquisitions and divestitures

 

 

197

 

 

 

514

 

 

 

522

 

 

 

1,648

 

Adjusted gross profit

 

$

244,240

 

 

$

242,824

 

 

$

755,758

 

 

$

683,086

 

 

 

 

 

 

 

 

 

 

GAAP gross profit margin

 

 

38.5

%

 

 

35.6

%

 

 

38.2

%

 

 

34.4

%

Adjusted gross profit margin

 

 

39.0

%

 

 

36.2

%

 

 

38.5

%

 

 

35.1

%

 

 

 

 

 

 

 

 

 

GAAP selling, general and administrative expenses

 

$

(118,079

)

 

$

(110,478

)

 

$

(366,288

)

 

$

(318,747

)

Severance, restructuring, and acquisition integration costs

 

 

5,213

 

 

 

1,764

 

 

 

10,402

 

 

 

5,369

 

Adjustments related to acquisitions and divestitures

 

 

298

 

 

 

(2,537

)

 

 

520

 

 

 

(3,095

)

Adjusted selling, general and administrative expenses

 

$

(112,568

)

 

$

(111,251

)

 

$

(355,366

)

 

$

(316,473

)

 

 

 

 

 

 

 

 

 

GAAP research and development expenses

 

$

(30,190

)

 

$

(26,306

)

 

$

(90,544

)

 

$

(75,751

)

Severance, restructuring, and acquisition integration costs

 

 

(50

)

 

 

 

 

 

44

 

 

 

 

Adjusted research and development expenses

 

$

(30,240

)

 

$

(26,306

)

 

$

(90,500

)

 

$

(75,751

)

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations

 

$

72,327

 

 

$

103,687

 

 

$

204,047

 

 

$

206,425

 

Income tax expense

 

 

14,850

 

 

 

16,104

 

 

 

45,385

 

 

 

39,014

 

Interest expense, net

 

 

8,580

 

 

 

9,883

 

 

 

25,593

 

 

 

35,570

 

Non-operating pension settlement loss

 

 

 

 

 

954

 

 

 

 

 

 

954

 

Loss on debt extinguishment

 

 

 

 

 

 

 

 

 

 

 

6,392

 

Total non-operating adjustments

 

 

23,430

 

 

 

26,941

 

 

 

70,978

 

 

 

81,930

 

 

 

 

 

 

 

 

 

 

Amortization of intangible assets

 

 

9,526

 

 

 

10,105

 

 

 

30,262

 

 

 

28,099

 

Severance, restructuring, and acquisition integration costs

 

 

6,075

 

 

 

4,560

 

 

 

11,846

 

 

 

14,140

 

Amortization of software development intangible assets

 

 

1,963

 

 

 

868

 

 

 

5,235

 

 

 

2,856

 

Adjustments related to acquisitions and divestitures

 

 

495

 

 

 

(2,023

)

 

 

1,042

 

 

 

(1,447

)

Gain on sale of assets

 

 

(12,056

)

 

 

(37,891

)

 

 

(12,056

)

 

 

(37,891

)

Total operating income adjustments

 

 

6,003

 

 

 

(24,381

)

 

 

36,329

 

 

 

5,757

 

Depreciation expense

 

 

13,442

 

 

 

11,847

 

 

 

38,478

 

 

 

34,443

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

115,202

 

 

$

118,094

 

 

$

349,832

 

 

$

328,555

 

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations margin

 

 

11.5

%

 

 

15.5

%

 

 

10.4

%

 

 

10.6

%

Adjusted EBITDA margin

 

 

18.4

%

 

 

17.6

%

 

 

17.8

%

 

 

16.9

%

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations

 

$

72,327

 

 

$

103,687

 

 

$

204,047

 

 

$

206,425

 

Less: Net income (loss) attributable to noncontrolling interest

 

 

(20

)

 

 

27

 

 

 

(245

)

 

 

111

 

GAAP net income from continuing operations attributable to Belden stockholders

 

$

72,347

 

 

$

103,660

 

 

$

204,292

 

 

$

206,314

 

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations

 

$

72,327

 

 

$

103,687

 

 

$

204,047

 

 

$

206,425

 

Plus: Operating income adjustments from above

 

 

6,003

 

 

 

(24,381

)

 

 

36,329

 

 

 

5,757

 

Plus: Non-operating pension settlement loss

 

 

 

 

 

954

 

 

 

 

 

 

954

 

Plus: Loss on debt extinguishment

 

 

 

 

 

 

 

 

 

 

 

6,392

 

Less: Net income (loss) attributable to noncontrolling interest

 

 

(20

)

 

 

27

 

 

 

(245

)

 

 

111

 

Less: Tax effect of adjustments above

 

 

2,682

 

 

 

2,121

 

 

 

9,202

 

 

 

10,360

 

Adjusted net income from continuing operations attributable to Belden stockholders

 

$

75,668

 

 

$

78,112

 

 

$

231,419

 

 

$

209,057

 

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations per diluted share attributable to Belden stockholders

 

$

1.70

 

 

$

2.35

 

 

$

4.74

 

 

$

4.60

 

Adjusted income from continuing operations per diluted share attributable to Belden stockholders

 

$

1.78

 

 

$

1.77

 

 

$

5.37

 

 

$

4.67

 

 

 

 

 

 

 

 

 

 

GAAP and adjusted diluted weighted average shares

 

 

42,625

 

 

 

44,063

 

 

 

43,129

 

 

 

44,810

 

 
 
 
 

BELDEN INC.

RECONCILIATION OF NON-GAAP MEASURES

(Unaudited)

We define free cash flow, which is a non-GAAP financial measure, as net cash from operating activities adjusted for capital expenditures net of the proceeds from the disposal of assets. We believe free cash flow provides useful information to investors regarding our ability to generate cash from business operations that is available for acquisitions and other investments, service of debt principal, dividends and share repurchases. We use free cash flow, as defined, as one financial measure to monitor and evaluate performance and liquidity. Non-GAAP financial measures should be considered only in conjunction with financial measures reported according to accounting principles generally accepted in the United States. Our definition of free cash flow may differ from definitions used by other companies.

 

 

Three Months Ended

 

Nine Months Ended

 

 

October 1,

2023

 

October 2,

2022

 

October 1,

2023

 

October 2,

2022

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

GAAP net cash provided by operating activities

 

$

105,278

 

 

$

87,381

 

 

$

159,993

 

 

$

78,800

 

Capital expenditures

 

 

(29,141

)

 

 

(19,240

)

 

 

(61,870

)

 

 

(50,250

)

Proceeds from disposal of tangible assets

 

 

13,776

 

 

 

42,110

 

 

 

13,785

 

 

 

43,534

 

Non-GAAP free cash flow

 

$

89,913

 

 

$

110,251

 

 

$

111,908

 

 

$

72,084

 

 
 
 
 

BELDEN INC.

RECONCILIATION OF NON-GAAP MEASURES

2023 Guidance
 

 

 

 

Three Months Ended

 

 

December 31, 2023

 

 

 

 

 

GAAP income from continuing operations per diluted share attributable to Belden common stockholders

 

$0.49 - $0.64

Amortization of intangible assets

 

0.21

Severance, restructuring, and acquisition integration costs

 

0.34

Adjustments related to acquisitions and divestitures

 

0.01

Adjusted income from continuing operations per diluted share attributable to Belden common stockholders

 

$1.05 - $1.20

Our guidance is based upon information currently available regarding events and conditions that will impact our future operating results. In particular, our results are subject to the factors listed under "Forward-Looking Statements" in this release. In addition, our actual results are likely to be impacted by other additional events for which information is not available, such as asset impairments, adjustments related to acquisitions and divestitures, severance, restructuring, and acquisition integration costs, gains (losses) recognized on the disposal of assets, gains (losses) on debt extinguishment, discontinued operations, and other gains (losses) related to events or conditions that are not yet known.

Forward-Looking Statements

This release contains, and any statements made by us concerning the subject matter of this release may contain, forward-looking statements, including our outlook for the fourth quarter and full year 2023 and Adjusted EPS for 2025. Forward-looking statements also include any statements regarding future financial performance (including revenues, growth, expenses, earnings, margins, cash flows, dividends, capital expenditures and financial condition), plans and objectives, and related assumptions. In some cases these statements are identifiable through the use of words such as “anticipate,” “believe,” “estimate,” “forecast,” “guide,” “expect,” “intend,” “plan,” “project,” “target,” “can,” “could,” “may,” “should,” “will,” “would” and similar expressions. Forward-looking statements reflect management’s current beliefs and expectations and are not guarantees of future performance. Actual results may differ materially from those suggested by any forward-looking statements for a number of reasons, including, without limitation: the impact of a challenging global economy or a downturn in served markets; the competitiveness of the global markets in which we operate; the inability of the Company to develop and introduce new products; competitive responses to our products; the inability to execute and realize the expected benefits from strategic initiatives (including revenue growth, cost control, and productivity improvement programs); foreign and domestic political, economic and other uncertainties, including changes in currency exchange rates; the impact of disruptions in the global supply chain, including the inability to timely obtain raw materials and components in sufficient quantities on commercially reasonable terms; the inability to achieve our strategic priorities in emerging markets; the impact of changes in global tariffs and trade agreements; volatility in credit and foreign exchange markets; the presence of substitute products in the marketplace; disruptions in the Company’s information systems including due to cyber-attacks; inflation and changes in the price and availability of raw materials leading to higher input and labor costs; the possibility of a resurgence of COVID-19 or the spread of other viruses; difficulty in forecasting revenue due to the unpredictable timing of orders related to customer projects as well as the impacts of channel inventory; changes in tax laws and variability in the Company’s quarterly and annual effective tax rates; the increased prevalence of cloud computing; the inability to successfully complete and integrate acquisitions in furtherance of the Company’s strategic plan; the inability to retain key employees; disruption of, or changes in, the Company’s key distribution channels; the presence of activists proposing certain actions by the Company; perceived or actual product failures; the impact of regulatory requirements and other legal compliance issues; inability to satisfy the increasing expectations with respect to environmental, social and governance matters; assertions that the Company violates the intellectual property of others and the ownership of intellectual property by competitors and others that prevents the use of that intellectual property by the Company; risks related to the use of open source software; the impairment of goodwill and other intangible assets and the resulting impact on financial performance; disruptions and increased costs attendant to collective bargaining groups and other labor matters; and other factors.

For a more complete discussion of risk factors, please see our Annual Report on Form 10-K for the period ended December 31, 2022, filed with the SEC on February 24, 2023. Although the content of this release represents our best judgment as of the date of this report based on information currently available and reasonable assumptions, we give no assurances that the expectations will prove to be accurate. Deviations from the expectations may be material. For these reasons, Belden cautions readers to not place undue reliance on these forward-looking statements, which speak only as of the date made. Belden disclaims any duty to update any forward-looking statements as a result of new information, future developments, or otherwise, except as required by law.

About Belden

Belden Inc. delivers the infrastructure that makes the digital journey simpler, smarter and secure. We’re moving beyond connectivity, from what we make to what we make possible through a performance-driven portfolio, forward-thinking expertise and purpose-built solutions. With a legacy of quality and reliability spanning 120-plus years, we have a strong foundation to continue building the future. We are headquartered in St. Louis and have manufacturing capabilities in North America, Europe, Asia, and Africa. For more information, visit us at www.belden.com; follow us on Facebook, LinkedIn and Twitter.

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