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Molex Posts 3Q Loss On Lower Revenue

The Associated Press

LISLE, Ill. (AP) — Electronics parts company Molex Inc. posted a fiscal third-quarter loss Tuesday as revenue dropped sharply amid the economic turmoil. But the company said orders improved each month during the quarter and have continued to rise in April, sending shares soaring more than 18 percent in after-hours trading.

For the three months ended March 31, the company posted a loss of $58.6 million, or 34 cents per share, compared with profit of $50.3 million, or 28 cents per share, in the same period a year earlier. The latest quarter's results included restructuring charges of 20 cents per share.

Revenue fell 39 percent to $505.5 million from $822.3 million.

Analysts, on average, were expecting a loss of 7 cents per share on higher sales of $528.1 million, according to a poll by Thomson Reuters. Analysts typically exclude one-time items from their estimates.

Orders fell 47 percent for the quarter to $475 million. But capital expenses also declined sharply, to $31.1 million from $61 million a year earlier.

"We believe that the revenue and orders for the quarter were below the level of current market demand, a result of inventory reductions within the supply chain," said Chief Executive Martin P. Slark, in a statement.

Molex makes micro-miniature connectors, SIM card sockets, keypads and internal antennas for the telecommunications market, as well as connectors and cables which link disk drives, controllers, servers and switches. The company also makes parts used in air bags and seatbelts, digital and video cameras and DVD players. Spending on IT equipment as well as auto manufacturing has dropped off sharply amid the economic downturn.

Molex gave a broad revenue forecast — it expects sales between $525 million to $575 million for the April-June quarter. Analysts estimate sales of $537.7 million, on average.

The company said that "while orders appear to have bottomed in the March quarter, future visibility remains limited," thus the reason for the wide range.

Shares jumped $3.01, or 18.4 percent, to $19.39 in aftermarket electronic trading. The stock earlier closed the regular session up 62 cents at $16.38.