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Amphenol Corporation reported today GAAP Diluted Earnings Per Share (EPS) for the second quarter 2018 of $0.91 compared to $0.80 for the comparable 2017 period. GAAP Diluted EPS for the second quarter 2018 includes an excess tax benefit of approximately $3 million ($0.01 per share) related to stock options exercised during the quarter compared to approximately $21 million ($0.07 per share) for the comparable 2017 period. In addition, the second quarter 2017 included a charge for acquisition-related transaction costs of approximately $4 million ($0.01 per share). Excluding the effect of these items, Adjusted Diluted EPS1 for the second quarter 2018 was a record $0.90 compared to $0.74 for the second quarter of 2017. Sales for the second quarter 2018 were a record $1.981 billion compared to $1.667 billion for the comparable 2017 period. Currency translation had the effect of increasing sales by approximately $40 million in the second quarter of 2018 compared to the 2017 period.
For the six months ended June 30, 2018, GAAP Diluted EPS was $1.75 compared to $1.51 for the comparable 2017 period. GAAP Diluted EPS for the six months ended June 30, 2018, includes an excess tax benefit of approximately $7 million ($0.02 per share) related to stock options exercised for the six months ended June 30, 2018 compared to approximately $29 million ($0.09 per share) for the comparable 2017 period. Excluding the effect of these items and the previously mentioned acquisition-related charge in the 2017 period, Adjusted Diluted EPS for the six months ended June 30, 2018 and 2017 was $1.73 and $1.43, respectively. Sales for the six months ended June 30, 2018 were $3.848 billion compared to $3.227 billion for the 2017 period. Currency translation had the effect of increasing sales by approximately $100 million for the first six months of 2018 compared to the 2017 period.
Amphenol President and Chief Executive Officer, R. Adam Norwitt, stated, “We are pleased to close the second quarter 2018 well above the high end of our guidance with record sales and Adjusted Diluted EPS in the quarter of $1.981 billion and $0.90, respectively. Compared to the second quarter 2017, sales increased 19%, driven primarily by strong organic growth across most of the Company’s diversified end markets, including mobile devices, military, industrial, commercial air, mobile networks, automotive, and IT and data communications, together with contributions from the Company’s successful acquisition program. 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, we are excited to have closed on two acquisitions in late June 2018. First, the Company acquired All Sensors Corporation, a supplier of high technology pressure sensors for industrial applications, with annual sales of approximately $15 million. In addition, the Company acquired Ardent Concepts, Inc., a manufacturer of high-speed, high reliability interconnect products used in the industrial and IT and data communications markets, with annual sales of approximately $10 million.”
“The Company’s Adjusted Diluted EPS growth of 22% in the quarter was driven by our superior operating execution, as reflected in the Company’s achievement of a record operating margin in the second quarter of 20.6%. I am very proud of our organization as we continue to execute extremely well.”
“Operating cash flow in the quarter was $265 million, which was strong in particular given the Company’s higher than normal tax-related payments in the quarter resulting from the Tax Cuts and Jobs Act. The Company continues to deploy its financial strength in a variety of ways to increase shareholder value. This included the purchase during the second quarter of 2018 of 3.1 million shares of the Company’s stock under our $2 billion 3-year open market stock repurchase plan.”
“While we are pleased with the current strong demand environment, there are still many uncertainties in the market, in particular related to global trade policy. Considering this environment and based on current currency exchange rates, we expect third quarter 2018 sales in the range of $1.980 billion to $2.020 billion and Adjusted Diluted EPS in the range of $0.91 to $0.93. For the full year 2018, we now expect to achieve sales in the range of $7.820 billion to $7.900 billion, an increase over 2017 of 12% to 13%, as well as Adjusted Diluted EPS in the range of $3.57 to $3.61, an increase over 2017 of 14% to 16%. This compares to our prior guidance for the full year 2018 of sales in the range of $7.630 billion to $7.750 billion and Adjusted Diluted EPS in the range of $3.49 to $3.55. This guidance does not reflect the potential impact of any future changes in global trade policy.”
“The electronics revolution continues to create exciting, long-term growth opportunities for Amphenol. We are encouraged by the Company’s broad-based and strong results, and we remain confident for the future. New applications and higher performance requirements continue to drive increased demand for our broadened range of high technology products across all our diversified end markets. Our ongoing actions to leverage our competitive advantages and create sustained financial strength, as well as our initiatives to expand our high technology product offering both organically and through our successful acquisition program, have created an excellent base for future performance. I am confident in the ability of our outstanding, entrepreneurial management team to dynamically adjust to the always changing 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.