Belden Reports Record Revenues and EPS for Full Year 2022 and Strong Results for Fourth Quarter 2022

Belden Inc. (NYSE: BDC) (the “Company”), a leading global supplier of network infrastructure solutions, today reported fiscal fourth quarter and full year results for the period ended December 31, 2022.

“Belden delivered another strong quarter of continued growth with expanding margins. For the full year 2022, we achieved both record revenues and record EPS. I am proud of how our teams navigated this challenging year by focusing on customer success and business outcomes. Our strength in 2022 was broad-based, demonstrating the strong secular growth trends benefiting our strategically positioned portfolio. For the full year, revenues grew 16% organically with improved profitability and expanded margins. We continue to invest our capital strategically in new product innovation, selective bolt-on acquisitions, and share repurchases. Our balance sheet is strong, as we ended the year with net leverage of 1.0x, down from 2.1x a year ago,” said Roel Vestjens, President and CEO of Belden Inc.

Fourth Quarter 2022

GAAP revenues for the quarter totaled $659 million, increasing $47 million, or 8%, compared to $612 million in the year-ago period. Organic year-over-year growth for the quarter was 12%, with Industrial Automation Solutions at 18% and Enterprise Solutions at 6%. Net income was $61 million, compared to $80 million in the year-ago period. Net income as a percentage of revenue was 9.3%, compared to 13.1% in the year-ago period. EPS totaled $1.40 for the quarter, compared to $1.76 in the year-ago period.

Adjusted revenues for the quarter totaled $659 million, increasing $48 million, or 8%, compared to $611 million in the year-ago period. Adjusted EBITDA was $115 million, increasing $14 million, or 14%, compared to $101 million in the year-ago period. Adjusted EBITDA margin was 17.4%, up 90 bps, compared to 16.5% in the year-ago period. Adjusted EPS was $1.75, increasing 35% compared to $1.30 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.

Full Year 2022

GAAP and Adjusted revenues for the year totaled a record $2.606 billion, increasing $305 million, or 13%, compared to $2.301 billion in the prior year. Organic growth for the year was 16%, with Industrial Automation Solutions at 19% and Enterprise Solutions at 13%. Net income was $268 million, compared to $199 million in the prior year. Net income as a percentage of revenue was 10.3%, compared to 8.6% in the prior year. EPS totaled an annual record $6.01, compared to $4.37 in the prior year, up 38%.

Adjusted EBITDA was $444 million, increasing $72 million, or 19%, compared to $372 million in the prior year. Adjusted EBITDA margin was 17.0%, up 90 bps, compared to 16.1% in the year-ago period. Adjusted EPS was an annual record $6.41, increasing 35% compared to $4.75 in the prior year.

Outlook

“2022 was a record year for Belden with growth across the business. While macro conditions remain uncertain as we enter 2023, our portfolio is designed to deliver organic growth in excess of GDP. We are confident in our ability to execute our strategy and generate sustainable, long-term shareholder value. Our transformed portfolio aligns Belden with key long-term secular trends that have lengthy investment cycles. Investments in automation, reshoring, increased connectivity, increasing bandwidth usage, and network upgrades all bode well for Belden to produce sustainable earnings growth. We ended 2022 with low leverage and significant liquidity, which will allow us to invest in future organic and inorganic growth opportunities. After record performance in 2022, we are confident in our ability to deliver at least $8.00 of adjusted EPS by 2025,” said Mr. Vestjens.

The table below provides guidance for both the full year 2023, as well as the first quarter of 2023.

Full Year 2023:

  • Revenues between $2.670 billion and $2.720 billion
  • Organic growth between 3% and 5%
  • GAAP EPS between $5.73 and $6.13
  • Adjusted EPS between $6.60 and $7.00

First Quarter 2023:

  • Revenues between $615 million and $630 million
  • Organic growth between 3% and 6%
  • GAAP EPS between $1.29 and $1.39
  • Adjusted EPS between $1.50 and $1.60

Earnings Conference Call

Management will host a conference call today at 8:30 am ET to discuss 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 2705002. 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), Net Leverage, 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. Net leverage is calculated as (A) total debt less cash and cash equivalents divided by (B) the sum of trailing twelve months Adjusted EBITDA plus trailing twelve months stock-based compensation expense. Organic growth is calculated as the change in revenues excluding the impacts of changes in currency exchange rates and copper prices, as well as acquisitions and divestitures.

BELDEN INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

Three Months Ended

 

Twelve Months Ended

 

 

December 31, 2022

 

December 31, 2021

 

December 31, 2022

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

(In thousands, except per share data)

Revenues

 

$

659,072

 

 

$

611,959

 

 

$

2,606,485

 

 

$

2,301,260

 

Cost of sales

 

 

(412,594

)

 

 

(404,030

)

 

 

(1,690,196

)

 

 

(1,529,417

)

Gross profit

 

 

246,478

 

 

 

207,929

 

 

 

916,289

 

 

 

771,843

 

Selling, general and administrative expenses

 

 

(129,889

)

 

 

(108,485

)

 

 

(448,636

)

 

 

(378,027

)

Research and development expenses

 

 

(28,599

)

 

 

(22,117

)

 

 

(104,350

)

 

 

(90,227

)

Amortization of intangibles

 

 

(9,761

)

 

 

(7,685

)

 

 

(37,860

)

 

 

(30,630

)

Asset impairments

 

 

 

 

 

 

 

 

 

 

 

(9,283

)

Gain on sale of asset

 

 

 

 

 

 

 

 

37,891

 

 

 

 

Operating income

 

 

78,229

 

 

 

69,642

 

 

 

363,334

 

 

 

263,676

 

Interest expense, net

 

 

(7,984

)

 

 

(16,061

)

 

 

(43,554

)

 

 

(62,693

)

Loss on debt extinguishment

 

 

 

 

 

 

 

 

(6,392

)

 

 

(5,715

)

Non-operating pension benefit

 

 

1,709

 

 

 

1,355

 

 

 

4,005

 

 

 

4,476

 

Gain on sale of note receivable

 

 

 

 

 

27,036

 

 

 

 

 

 

27,036

 

Income from continuing operations before taxes

 

 

71,954

 

 

 

81,972

 

 

 

317,393

 

 

 

226,780

 

Income tax expense

 

 

(10,631

)

 

 

(1,506

)

 

 

(49,645

)

 

 

(27,939

)

Income from continuing operations

 

 

61,323

 

 

 

80,466

 

 

 

267,748

 

 

 

198,841

 

Loss from discontinued operations, net of tax

 

 

 

 

 

(132,039

)

 

 

(3,685

)

 

 

(136,384

)

Gain (loss) on disposal of discontinued operations, net of tax

 

 

692

 

 

 

1,860

 

 

 

(9,241

)

 

 

1,860

 

Net income (loss)

 

 

62,015

 

 

 

(49,713

)

 

 

254,822

 

 

 

64,317

 

Less: Net income attributable to noncontrolling interest

 

 

48

 

 

 

56

 

 

 

159

 

 

 

392

 

Net income (loss) attributable to Belden stockholders

 

$

61,967

 

 

$

(49,769

)

 

$

254,663

 

 

$

63,925

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares and equivalents:

 

 

 

 

 

 

 

 

Basic

 

 

42,819

 

 

 

44,927

 

 

 

43,845

 

 

 

44,802

 

Diluted

 

 

43,705

 

 

 

45,729

 

 

 

44,537

 

 

 

45,361

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

Continuing operations

 

$

1.43

 

 

$

1.79

 

 

$

6.10

 

 

$

4.43

 

Discontinued operations

 

 

 

 

 

(2.94

)

 

 

(0.08

)

 

 

(3.04

)

Disposal of discontinued operations

 

 

0.02

 

 

 

0.04

 

 

 

(0.21

)

 

 

0.04

 

Net income (loss)

 

$

1.45

 

 

$

(1.11

)

 

$

5.81

 

 

$

1.43

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

Continuing operations

 

$

1.40

 

 

$

1.76

 

 

$

6.01

 

 

$

4.37

 

Discontinued operations

 

 

 

 

 

(2.94

)

 

 

(0.08

)

 

 

(3.04

)

Disposal of discontinued operations

 

 

0.02

 

 

 

0.04

 

 

 

(0.21

)

 

 

0.04

 

Net income (loss)

 

$

1.42

 

 

$

(1.11

)

 

$

5.72

 

 

$

1.41

 

Common stock dividends declared per share

 

$

0.05

 

 

$

0.05

 

 

$

0.20

 

 

$

0.20

 

BELDEN INC.

OPERATING SEGMENT INFORMATION

(Unaudited)

 

 

 

Enterprise

Solutions

 

Industrial Automation Solutions

 

Total

Segments

 

 

 

 

 

 

 

 

(In thousands, except percentages)

 

 

 

 

 

 

 

For the three months ended December 31, 2022

 

 

 

 

 

 

Segment Revenues

 

$

303,403

 

 

$

355,669

 

 

$

659,072

 

Segment EBITDA

 

 

42,699

 

 

 

70,436

 

 

 

113,135

 

Segment EBITDA margin

 

 

14.1

%

 

 

19.8

%

 

 

17.2

%

Depreciation expense

 

 

6,173

 

 

 

6,053

 

 

 

12,226

 

Amortization of intangibles

 

 

4,544

 

 

 

5,217

 

 

 

9,761

 

Amortization of software development intangible assets

 

 

2

 

 

 

1,017

 

 

 

1,019

 

Severance, restructuring, and acquisition integration costs

 

 

1,595

 

 

 

950

 

 

 

2,545

 

Adjustments related to acquisitions and divestitures

 

 

8,684

 

 

 

596

 

 

 

9,280

 

 

 

 

 

 

 

 

For the three months ended December 31, 2021

 

 

 

 

 

 

Segment Revenues

 

$

294,312

 

 

$

316,295

 

 

$

610,607

 

Segment EBITDA

 

 

39,806

 

 

 

59,662

 

 

 

99,468

 

Segment EBITDA margin

 

 

13.5

%

 

 

18.9

%

 

 

16.3

%

Depreciation expense

 

 

5,613

 

 

 

5,489

 

 

 

11,102

 

Amortization of intangibles

 

 

4,393

 

 

 

3,292

 

 

 

7,685

 

Amortization of software development intangible assets

 

 

22

 

 

 

392

 

 

 

414

 

Severance, restructuring, and acquisition integration costs

 

 

6,044

 

 

 

5,284

 

 

 

11,328

 

Adjustments related to acquisitions and divestitures

 

 

 

 

 

(750

)

 

 

(750

)

 

 

 

 

 

 

 

For the twelve months ended December 31, 2022

 

 

 

 

 

 

Segment Revenues

 

$

1,198,478

 

 

$

1,408,007

 

 

$

2,606,485

 

Segment EBITDA

 

 

161,517

 

 

 

277,079

 

 

 

438,596

 

Segment EBITDA margin

 

 

13.5

%

 

 

19.7

%

 

 

16.8

%

Depreciation expense

 

 

23,387

 

 

 

23,282

 

 

 

46,669

 

Amortization of intangibles

 

 

17,595

 

 

 

20,265

 

 

 

37,860

 

Amortization of software development intangible assets

 

 

54

 

 

 

3,821

 

 

 

3,875

 

Severance, restructuring, and acquisition integration costs

 

 

9,200

 

 

 

7,485

 

 

 

16,685

 

Adjustments related to acquisitions and divestitures

 

 

5,589

 

 

 

2,244

 

 

 

7,833

 

 

 

 

 

 

 

 

For the twelve months ended December 31, 2021

 

 

 

 

 

 

Segment Revenues

 

$

1,074,426

 

 

$

1,226,834

 

 

$

2,301,260

 

Segment EBITDA

 

 

144,509

 

 

 

222,684

 

 

 

367,193

 

Segment EBITDA margin

 

 

13.4

%

 

 

18.2

%

 

 

16.0

%

Depreciation expense

 

 

21,627

 

 

 

21,446

 

 

 

43,073

 

Amortization of intangibles

 

 

17,595

 

 

 

13,035

 

 

 

30,630

 

Amortization of software development intangible assets

 

 

94

 

 

 

1,485

 

 

 

1,579

 

Severance, restructuring, and acquisition integration costs

 

 

13,800

 

 

 

10,067

 

 

 

23,867

 

Adjustments related to acquisitions and divestitures

 

 

(7,052

)

 

 

2,017

 

 

 

(5,035

)

Asset impairments

 

 

 

 

 

9,283

 

 

 

9,283

 

BELDEN INC.

OPERATING SEGMENT RECONCILIATION TO CONSOLIDATED RESULTS

(Unaudited)

 

 

 

Three Months Ended

 

Twelve Months Ended

 

 

December 31, 2022

 

December 31, 2021

 

December 31, 2022

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Total Segment Revenues

 

$

659,072

 

 

$

610,607

 

 

$

2,606,485

 

 

$

2,301,260

 

Adjustments related to acquisitions

 

 

 

 

 

1,352

 

 

 

 

 

 

 

Consolidated Revenues

 

$

659,072

 

 

$

611,959

 

 

$

2,606,485

 

 

$

2,301,260

 

 

 

 

 

 

 

 

 

 

Total Segment EBITDA

 

$

113,135

 

 

$

99,468

 

 

$

438,596

 

 

$

367,193

 

Total non-operating pension benefit

 

 

1,709

 

 

 

1,355

 

 

 

4,005

 

 

 

4,476

 

Non-operating pension settlement loss

 

 

235

 

 

 

 

 

 

1,189

 

 

 

 

Eliminations

 

 

(75

)

 

 

(47

)

 

 

(231

)

 

 

(120

)

Consolidated Adjusted EBITDA (1)

 

 

115,004

 

 

 

100,776

 

 

 

443,559

 

 

 

371,549

 

Depreciation expense

 

 

(12,226

)

 

 

(11,102

)

 

 

(46,669

)

 

 

(43,073

)

Amortization of intangibles

 

 

(9,761

)

 

 

(7,685

)

 

 

(37,860

)

 

 

(30,630

)

Adjustments related to acquisitions and divestitures

 

 

(9,280

)

 

 

750

 

 

 

(7,833

)

 

 

5,035

 

Interest expense, net

 

 

(7,984

)

 

 

(16,061

)

 

 

(43,554

)

 

 

(62,693

)

Severance, restructuring, and acquisition integration costs

 

 

(2,545

)

 

 

(11,328

)

 

 

(16,685

)

 

 

(23,867

)

Amortization of software development intangible assets

 

 

(1,019

)

 

 

(414

)

 

 

(3,875

)

 

 

(1,579

)

Non-operating pension settlement loss

 

 

(235

)

 

 

 

 

 

(1,189

)

 

 

 

Loss on debt extinguishment

 

 

 

 

 

 

 

 

(6,392

)

 

 

(5,715

)

Asset impairments

 

 

 

 

 

 

 

 

 

 

 

(9,283

)

Gain on sale of asset

 

 

 

 

 

 

 

 

37,891

 

 

 

 

Gain on sale of note receivable

 

 

 

 

 

27,036

 

 

 

 

 

 

27,036

 

Income from continuing operations before taxes

 

$

71,954

 

 

$

81,972

 

 

$

317,393

 

 

$

226,780

 

(1)

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

BELDEN INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

 

 

December 31, 2022

 

December 31, 2021

 

 

(In thousands)

ASSETS

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

687,676

 

 

$

641,563

 

Receivables, net

 

 

440,102

 

 

 

383,444

 

Inventories, net

 

 

341,563

 

 

 

345,203

 

Other current assets

 

 

66,866

 

 

 

58,283

 

Assets of discontinued operations

 

 

 

 

 

449,152

 

Total current assets

 

 

1,536,207

 

 

 

1,877,645

 

Property, plant and equipment, less accumulated depreciation

 

 

381,864

 

 

 

343,564

 

Operating lease right-of-use assets

 

 

73,376

 

 

 

75,571

 

Goodwill

 

 

862,253

 

 

 

821,448

 

Intangible assets, less accumulated amortization

 

 

246,830

 

 

 

238,155

 

Deferred income taxes

 

 

14,642

 

 

 

31,736

 

Other long-lived assets

 

 

46,503

 

 

 

29,558

 

 

 

$

3,161,675

 

 

$

3,417,677

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

 

 

 

 

Accounts payable

 

$

350,058

 

 

$

377,765

 

Accrued liabilities

 

 

289,861

 

 

 

278,108

 

Liabilities of discontinued operations

 

 

 

 

 

96,993

 

Total current liabilities

 

 

639,919

 

 

 

752,866

 

Long-term debt

 

 

1,161,176

 

 

 

1,459,991

 

Postretirement benefits

 

 

67,828

 

 

 

120,997

 

Deferred income taxes

 

 

58,582

 

 

 

51,113

 

Long-term operating lease liabilities

 

 

59,250

 

 

 

61,967

 

Other long-term liabilities

 

 

30,970

 

 

 

14,661

 

Stockholders’ equity:

 

 

 

 

Common stock

 

 

503

 

 

 

503

 

Additional paid-in capital

 

 

825,669

 

 

 

833,627

 

Retained earnings

 

 

751,522

 

 

 

505,717

 

Accumulated other comprehensive loss

 

 

(5,871

)

 

 

(70,566

)

Treasury stock

 

 

(428,812

)

 

 

(313,994

)

Total Belden stockholders’ equity

 

 

1,143,011

 

 

 

955,287

 

Noncontrolling interests

 

 

939

 

 

 

795

 

Total stockholders’ equity

 

 

1,143,950

 

 

 

956,082

 

 

 

$

3,161,675

 

 

$

3,417,677

 

BELDEN INC.

CONDENSED CONSOLIDATED CASH FLOW STATEMENTS

(Unaudited)

 

 

 

Twelve Months Ended

 

 

December 31, 2022

 

December 31, 2021

 

 

 

 

 

 

 

(In thousands)

Cash flows from operating activities:

 

 

 

 

Net income

 

$

254,822

 

 

$

64,316

 

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

 

 

 

 

Depreciation and amortization

 

 

88,738

 

 

 

87,988

 

Share-based compensation

 

 

23,676

 

 

 

24,871

 

Loss on debt extinguishment

 

 

6,392

 

 

 

5,715

 

Goodwill and other asset impairment

 

 

 

 

 

140,461

 

Deferred income tax expense (benefit)

 

 

(627

)

 

 

3,575

 

Gain on sale of asset

 

 

(37,891

)

 

 

 

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

 

 

 

 

Receivables

 

 

(33,605

)

 

 

(119,012

)

Inventories

 

 

5,558

 

 

 

(92,984

)

Accounts payable

 

 

(20,595

)

 

 

135,666

 

Accrued liabilities

 

 

(5,416

)

 

 

61,241

 

Income taxes

 

 

2,335

 

 

 

(6,448

)

Other assets

 

 

2,881

 

 

 

(12,692

)

Other liabilities

 

 

(4,972

)

 

 

(20,642

)

Net cash provided by operating activities

 

 

281,296

 

 

 

272,055

 

Cash flows from investing activities:

 

 

 

 

Proceeds from disposal of businesses, net of cash sold

 

 

334,574

 

 

 

45,735

 

Proceeds from disposal of tangible assets

 

 

43,534

 

 

 

30,234

 

Purchase of intangible assets

 

 

 

 

 

(3,650

)

Cash used for acquisitions and investments, net of cash acquired

 

 

(104,603

)

 

 

(73,340

)

Capital expenditures

 

 

(105,094

)

 

 

(90,982

)

Net cash provided by (used for) investing activities

 

 

168,411

 

 

 

(92,003

)

Cash flows from financing activities:

 

 

 

 

Payments under borrowing arrangements

 

 

(230,639

)

 

 

(360,304

)

Payments under share repurchase program

 

 

(150,000

)

 

 

 

Cash dividends paid

 

 

(8,949

)

 

 

(9,056

)

Withholding tax payments for share-based payment awards

 

 

(7,186

)

 

 

(5,570

)

Payments under financing lease obligations

 

 

(157

)

 

 

(3,151

)

Debt issuance costs paid

 

 

 

 

 

(8,173

)

Payments to noncontrolling interest holders

 

 

 

 

 

(2,682

)

Proceeds from issuance of common stock

 

 

3,717

 

 

 

 

Borrowings under credit arrangements

 

 

 

 

 

356,010

 

Net cash used for financing activities

 

 

(393,214

)

 

 

(32,926

)

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

 

 

(12,574

)

 

 

(5,363

)

Increase in cash and cash equivalents

 

 

43,919

 

 

 

141,763

 

Cash and cash equivalents, beginning of period

 

 

643,757

 

 

 

501,994

 

Cash and cash equivalents, end of period

 

$

687,676

 

 

$

643,757

 

The Condensed Consolidated Cash Flow Statement includes the results of discontinued operations up to the disposal date, February 22, 2022.

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 and deferred revenue to fair value and transaction costs; severance, restructuring, and acquisition integration costs; gains (losses) recognized on the disposal of businesses and tangible assets; amortization of intangible assets; gains (losses) on debt extinguishment; certain revenues and 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 the purchase accounting effect of recording deferred revenue at fair value in order to reflect the revenues that would have otherwise been recorded by acquired businesses had they remained as independent entities. We believe this presentation is useful in evaluating the underlying performance of acquired companies. Similarly, we adjust for other acquisition-related expenses, such as amortization of intangibles and other 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

 

Twelve Months Ended

 

 

December 31, 2022

 

December 31, 2021

 

December 31, 2022

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

(In thousands, except percentages and per share amounts)

GAAP revenues

 

$

659,072

 

 

$

611,959

 

 

$

2,606,485

 

 

$

2,301,260

 

Adjustments related to acquisitions

 

 

 

 

 

(1,352

)

 

 

 

 

 

 

Adjusted revenues

 

$

659,072

 

 

$

610,607

 

 

$

2,606,485

 

 

$

2,301,260

 

 

GAAP gross profit

 

$

246,478

 

 

$

207,929

 

 

$

916,289

 

 

$

771,843

 

Severance, restructuring, and acquisition integration costs

 

 

1,317

 

 

 

7,002

 

 

 

10,088

 

 

 

11,308

 

Amortization of software development intangible assets

 

 

1,019

 

 

 

414

 

 

 

3,875

 

 

 

1,579

 

Adjustments related to acquisitions and divestitures

 

 

 

 

 

(1,352

)

 

 

1,648

 

 

 

2,349

 

Adjusted gross profit

 

$

248,814

 

 

$

213,993

 

 

$

931,900

 

 

$

787,079

 

 

GAAP gross profit margin

 

 

37.4

%

 

 

34.0

%

 

 

35.2

%

 

 

33.5

%

Adjusted gross profit margin

 

 

37.8

%

 

 

35.0

%

 

 

35.8

%

 

 

34.2

%

GAAP selling, general and administrative expenses

 

$

(129,890

)

 

$

(108,485

)

 

$

(448,637

)

 

$

(378,027

)

Severance, restructuring, and acquisition integration costs

 

 

1,228

 

 

 

4,326

 

 

 

6,597

 

 

 

12,559

 

Adjustments related to acquisitions and divestitures

 

 

9,280

 

 

 

602

 

 

 

7,833

 

 

 

(7,384

)

Adjusted selling, general and administrative expenses

 

$

(119,382

)

 

$

(103,557

)

 

$

(434,207

)

 

$

(372,852

)

 

 

 

 

 

 

 

 

 

GAAP and adjusted research and development expenses

 

$

(28,599

)

 

$

(22,117

)

 

$

(104,350

)

 

$

(90,227

)

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations

 

$

61,323

 

 

$

80,466

 

 

$

267,748

 

 

$

198,841

 

Interest expense, net

 

 

7,984

 

 

 

16,061

 

 

 

43,554

 

 

 

62,693

 

Income tax expense

 

 

10,631

 

 

 

1,506

 

 

 

49,645

 

 

 

27,939

 

Loss on debt extinguishment

 

 

 

 

 

 

 

 

6,392

 

 

 

5,715

 

Non-operating pension settlement loss

 

 

235

 

 

 

 

 

 

1,189

 

 

 

 

Gain on sale of note receivable

 

 

 

 

 

(27,036

)

 

 

 

 

 

(27,036

)

Total non-operating adjustments

 

 

18,850

 

 

 

(9,469

)

 

 

100,780

 

 

 

69,311

 

Asset impairments

 

 

 

 

 

 

 

 

 

 

 

9,283

 

Severance, restructuring, and acquisition integration costs

 

 

2,545

 

 

 

11,328

 

 

 

16,685

 

 

 

23,867

 

Amortization of intangible assets

 

 

9,761

 

 

 

7,685

 

 

 

37,860

 

 

 

30,630

 

Amortization of software development intangible assets

 

 

1,019

 

 

 

414

 

 

 

3,875

 

 

 

1,579

 

Adjustments related to acquisitions and divestitures

 

 

9,280

 

 

 

(750

)

 

 

7,833

 

 

 

(5,035

)

Gain on sale of asset

 

 

 

 

 

 

 

 

(37,891

)

 

 

 

Total operating income adjustments

 

 

22,605

 

 

 

18,677

 

 

 

28,362

 

 

 

60,324

 

Depreciation expense

 

 

12,226

 

 

 

11,102

 

 

 

46,669

 

 

 

43,073

 

Adjusted EBITDA

 

$

115,004

 

 

$

100,776

 

 

$

443,559

 

 

$

371,549

 

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations margin

 

 

9.3

%

 

 

13.1

%

 

 

10.3

%

 

 

8.6

%

Adjusted EBITDA margin

 

 

17.4

%

 

 

16.5

%

 

 

17.0

%

 

 

16.1

%

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations

 

$

61,323

 

 

$

80,466

 

 

$

267,748

 

 

$

198,841

 

Less: Net income attributable to noncontrolling interest

 

 

48

 

 

 

56

 

 

 

159

 

 

 

392

 

GAAP net income from continuing operations attributable to Belden

stockholders

 

$

61,275

 

 

$

80,410

 

 

$

267,589

 

 

$

198,449

 

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations

 

$

61,323

 

 

$

80,466

 

 

$

267,748

 

 

$

198,841

 

Plus: Operating income adjustments from above

 

 

22,605

 

 

 

18,677

 

 

 

28,362

 

 

 

60,324

 

Plus: Loss on debt extinguishment

 

 

 

 

 

 

 

 

6,392

 

 

 

5,715

 

Plus: Non-operating pension settlement loss

 

 

235

 

 

 

 

 

 

1,189

 

 

 

 

Less: Gain on sale of note receivable

 

 

 

 

 

27,036

 

 

 

 

 

 

27,036

 

Less: Net income attributable to noncontrolling interest

 

 

48

 

 

 

56

 

 

 

159

 

 

 

392

 

Less: Tax effect of adjustments above

 

 

7,809

 

 

 

12,595

 

 

 

18,169

 

 

 

21,957

 

Adjusted net income from continuing operations attributable to Belden

stockholders

 

$

76,306

 

 

$

59,456

 

 

$

285,363

 

 

$

215,495

 

 

 

 

 

 

 

 

 

 

GAAP income from continuing operations per diluted share attributable to

Belden stockholders (EPS)

 

$

1.40

 

 

$

1.76

 

 

$

6.01

 

 

$

4.37

 

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

 

$

1.75

 

 

$

1.30

 

 

$

6.41

 

 

$

4.75

 

 

 

 

 

 

 

 

 

 

GAAP and adjusted diluted weighted average shares

 

 

43,705

 

 

 

45,729

 

 

 

44,537

 

 

 

45,361

 

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 tangible 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

 

Twelve Months Ended

 

 

December 31, 2022

 

December 31, 2021

 

December 31, 2022

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

GAAP net cash provided by operating activities

 

$

202,496

 

 

$

170,136

 

 

$

281,296

 

 

$

272,055

 

Capital expenditures

 

 

(54,844

)

 

 

(35,413

)

 

 

(105,094

)

 

 

(90,982

)

Proceeds from disposal of assets

 

 

 

 

 

26,985

 

 

 

43,534

 

 

 

30,234

 

Non-GAAP free cash flow

 

$

147,652

 

 

$

161,708

 

 

$

219,736

 

 

$

211,307

 

BELDEN INC.

RECONCILIATION OF NON-GAAP MEASURES

2023 Guidance

 

 

 

Year Ended

 

Three Months Ended

 

 

December 31, 2023

 

April 2, 2023

 

 

 

 

 

 

 

(In thousands)

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

 

$5.73 - $6.13

 

$1.29 - $1.39

Amortization of intangible assets

 

0.69

 

0.18

Severance, restructuring, and acquisition integration costs

 

0.16

 

0.02

Adjustments related to acquisitions and divestitures

 

0.02

 

0.01

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

 

$6.60 - $7.00

 

$1.50 - $1.60

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. Such information is not available for our 2025 fiscal year, and therefore we are unable to estimate 2025 GAAP income from continuing operations per diluted share attributable to Belden common stockholders.

Forward-Looking Statements

This release contains, and any statements made by us concerning the subject matter of this release contain, forward-looking statements, including our expectations for the first 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 disruptions in the global supply chain, including the inability to obtain raw materials and components in sufficient quantities on commercially reasonable terms; the lack of certainty as to the duration and magnitude of the impact of COVID-19 and the economic recovery from that impact; foreign and domestic political, economic and other uncertainties, including changes in currency exchange rates; the impact of a challenging global economy or a downturn in served markets; the inability to successfully complete and integrate acquisitions in furtherance of the Company’s strategic plan; difficulty in forecasting revenue due to the unpredictable timing of orders related to customer projects as well as the impacts of channel inventory; inflation and changes in the price and availability of raw materials leading to higher input and labor costs; the inability to execute and realize the expected benefits from strategic initiatives (including revenue growth, cost control, and productivity improvement programs); the inability to retain key employees; the increased influence of chief information officers on purchasing decisions; disruptions in the Company’s information systems including due to cyber-attacks leading to exposures of personally identifiable information; changes in tax laws and variability in the Company’s quarterly and annual effective tax rates; the competitiveness of the global markets in which we operate; the presence of substitute products in the marketplace; the increased prevalence of cloud computing; the inability of the Company to develop and introduce new products and competitive responses to our products; 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 activists proposing certain actions by the Company; perceived or actual product failures; risks related to the use of open source software; disruption of, or changes in, the Company’s key distribution channels; 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; the impact of regulatory requirements and other legal compliance issues; 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, 2021, filed with the SEC on February 15, 2022. 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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