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Amphenol Corporation reported today third quarter 2016 GAAP Diluted earnings per share (EPS) of $0.71 compared to $0.65 for the comparable 2015 period. GAAP Diluted EPS for the third quarter 2016 included a charge for acquisition-related transaction costs of $6 million ($0.02 per share). Excluding the effect of this item, third quarter 2016 Adjusted Diluted EPS1 was $0.73. Sales for the third quarter of 2016 were a record $1.636 billion compared to $1.460 billion for the comparable 2015 period. Currency translation had the effect of decreasing sales by approximately $12 million in the third quarter of 2016 compared to the 2015 period.
For the nine months ended September 30, 2016, GAAP Diluted EPS was $1.86, compared to $1.78 for the comparable 2015 period. The 2016 period included the $6 million of acquisition-related transaction costs noted above, as well as a charge for acquisition-related costs of $30 million ($0.09 per share) relating to the acquisition of FCI Asia Pte Ltd (FCI) on January 8, 2016. The FCI acquisition-related costs included external transaction costs, amortization related to the value associated with acquired backlog and restructuring charges. GAAP diluted earnings per share for the comparable 2015 period included a charge for acquisition-related transaction costs of $6 million ($0.02 per share). Excluding the effect of these items, Adjusted Diluted EPS for the nine months ended September 30, 2016 and 2015 was $1.97 and $1.80, respectively. Sales for the nine months ended September 30, 2016 were $4.635 billion compared to $4.138 billion for the comparable 2015 period. Currency translation had the effect of decreasing sales by approximately $40 million for the first nine months of 2016 compared to the comparable 2015 period.
The Company’s Board of Directors has also approved an increase in the Company’s quarterly dividend from $0.14 to $0.16 per share to be paid on or about January 5, 2017 to holders of record of the Company’s Class A Common stock as of December 13, 2016.
Amphenol President and Chief Executive Officer, R. Adam Norwitt, stated, “We are very pleased to report results above the high end of our guidance for the third quarter 2016, with record sales and Adjusted Diluted EPS of $1.636 billion and $0.73, respectively. We achieved these results despite ongoing uncertainties in the global economy. Compared to the third quarter 2015, sales increased by 12%, driven by organic growth in all markets except mobile devices together with contributions from the Company’s successful acquisition program. Our unique entrepreneurial culture continues to enable strong operating results, as demonstrated by the Company’s Adjusted Operating Margins reaching a record 20.3% in the third quarter 2016. This excellent profitability is a direct result of our dynamic management team’s ability to drive disciplined operational execution together with an unrelenting focus on all elements of cost. Operating cash flow in the quarter was $291 million, a clear confirmation of the quality of the Company’s earnings. I am very proud of our organization as we continue to execute extremely well in an uncertain market environment.
“The Company continues to expand its growth opportunities through a deep commitment to developing enabling technologies for customers in all markets, an ongoing strategy of market and geographic diversification, as well as an active and successful acquisition program. As part of that program, at the end of the third quarter, the Company acquired All Systems Broadband. All Systems Broadband, based in California, is a leading supplier of cable assemblies and value added fiber optic products for the broadband market with annual sales of approximately $40 million. In addition, at the beginning of the fourth quarter, the Company acquired SGX Sensortech (SGX). SGX, based in Switzerland, designs and manufactures air quality sensors used in a variety of automotive and industrial applications, and generates annual sales of approximately $15 million. These acquisitions strengthen the Company’s global capabilities and enhance our product offering in these important end markets.
“In addition to our successful acquisition program, the Company continues to deploy its financial strength in a variety of ways to increase shareholder value. This includes the purchase, during the quarter, of 2.0 million shares of the Company’s stock pursuant to our stock repurchase plan, bringing total repurchases for the plan to over 8.5 million shares. In addition, the Board of Directors has approved a 14% increase in our quarterly dividend, from $0.14 to $0.16 per share.
“The current global economic environment remains volatile and uncertain. Considering this environment and based on current currency exchange rates, we expect fourth quarter 2016 sales in the range of $1.585 billion to $1.625 billion and GAAP Diluted EPS in the range of $0.71 to $0.73. For the full year 2016, we now expect to achieve sales in the range of $6.220 billion to $6.260 billion, an increase over 2015 of 12% and GAAP Diluted EPS of $2.57 to $2.59, an increase of 7% over 2015. We expect Adjusted Diluted EPS of $2.68 to $2.70 for the full year 2016, an increase of 10% to 11% over 2015. This compares to our prior full year 2016 guidance of $6.120 billion to $6.200 billion in sales, GAAP Diluted EPS of $2.51 to $2.55 and Adjusted Diluted EPS of $2.60 to $2.64.
“Notwithstanding the current uncertain environment, we remain extremely excited about the future. The electronics revolution continues to create a significant, long-term growth opportunity for Amphenol, with new applications and higher performance requirements driving increased demand for our high technology products across all of our end markets. Our ongoing actions to strengthen our competitive advantages and build sustained financial strength, as well as our initiatives to broaden and diversify our high technology product offering both organically and through our successful acquisition program, have created a solid base for future performance. I am confident in the ability of our outstanding management team to dynamically adjust to the constantly changing market environment, to continue to generate strong profitability and to further capitalize on the many opportunities to expand our market position.”
About Amphenol Corporation
Amphenol Corporation is one of the world’s largest designers, manufacturers and marketers of electrical, electronic and fiber optic connectors, interconnect systems, antennas, sensors and sensor-based products and coaxial and high-speed specialty cable. Amphenol designs, manufactures and assembles its products at facilities in the Americas, Europe, Asia, Australia and Africa and sells its products through its own global sales force, independent representatives and a global network of electronics distributors. Amphenol has a diversified presence as a leader in high growth areas of the interconnect market including: Automotive, Broadband Communications, Commercial Aerospace, Industrial, Information Technology and Data Communications, Military, Mobile Devices and Mobile Networks.