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Pulse Electronics Corporation Reports Fourth Quarter Results

Based on discussions with investors and equity analysts, we believe that a reader’s understanding of the company’s operating performance is enhanced by references to these non-GAAP measures. Removing charges for severance, impairment and other associated costs, non-cash stock-based compensation expenses and other adjustments may facilitate comparisons of operating performance among financial periods and peer companies. These charges result from facility closures, the exit of a product line, production relocations and capacity reductions and / or restructuring of overhead and operating expenses to enhance or maintain profitability in an increasingly competitive environment. Removing non-cash stock-based compensation expenses facilitates comparisons of the company’s operating performance with that of other companies with differing compensation structures and with the company’s performance in periods during which its own compensation structure may have been different. Impairment charges, accelerated depreciation and costs related to an unsolicited takeover attempt are not part of the normal operating expense structure of the relevant business in the period in which the charge is recorded.

Copyright © 2012 Pulse Electronics Corporation. All rights reserved. All brand names and trademarks are properties of their respective holders.

       
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands, except per-share amounts)
Three Months Ended Twelve Months Ended
12/30/11 12/31/10 12/30/11 12/31/10
 
Net sales $ 90,473 $ 101,184 $ 369,284 $ 432,480
Cost of sales   73,235     76,097     289,148     323,865  
Gross profit 17,238 25,087 80,136 108,615
Operating expenses 18,799 19,252 81,393 91,653
Severance, impairment and other associated costs 1,128 1,705 14,719 32,799
Costs related to unsolicited takeover attempt   --     --     1,916     --  
Operating (loss) profit (2,689 ) 4,130 (17,892 ) (15,837 )
 
Interest expense, net (1,834 ) (1,105 ) (6,202 ) (4,853 )
Other expense, net   (1,182 )   (213 )   (561 )   (4,356 )
(Loss) profit from continuing operations before income taxes (5,705 ) 2,812 (24,655 ) (25,046 )
Income tax expense   37,303     659     28,791     2,691  
Net (loss) earnings from continuing operations (43,008 ) 2,153 (53,446 ) (27,737 )
Loss from discontinued operations, net of taxes   (370 )   (699 )   (28 )   (9,679 )
Net (loss) earnings (43,378 ) 1,454 (53,474 ) (37,416 )
Non-controlling interest, net of taxes   62     (273 )   88     (987 )
Net (loss) earnings attributable to Pulse Electronics Corporation (43,316 ) 1,181 (53,386 ) (38,403 )
 
Basic shares outstanding 41,227 41,069 41,182 40,990
Basic earnings (loss) per share from continuing operations (1.04 ) 0.05 (1.30 ) (0.70 )
Basic (loss) per share from discontinued operations   (0.01 )   (0.02 )   (0.00 )   (0.24 )
Basic earnings (loss) per share (1.05 ) 0.03 (1.30 ) (0.94 )
 
Diluted shares outstanding 41,227 41,231 41,182 40,990
Diluted earnings (loss) per share from continuing operations (1.04 ) 0.05 (1.30 ) (0.70 )
Diluted (loss) per share from discontinued operations   (0.01 )   (0.02 )   (0.00 )   (0.24 )
Diluted earnings (loss) per share (1.05 ) 0.03 (1.30 ) (0.94 )
 
AMOUNTS ATTRIBUTABLE TO PULSE ELECTRONICS CORPORATION:
 
Net (loss) earnings from continuing operations excluding non-controlling interest $ (42,946 ) $ 1,880 $ (53,358 ) $ (28,724 )
Net (loss) from discontinued operations   (370 )   (699 )   (28 )   (9,679 )
Net (loss) earnings attributable to Pulse Electronics Corporation (43,316 ) 1,181 (53,386 ) (38,403 )
 
       
BUSINESS SEGMENT INFORMATION (UNAUDITED)
(in thousands)
Three Months Ended Twelve Months Ended
12/30/2011 12/31/2010 12/30/2011 12/31/2010
Net Sales
Network 40,082 49,784 169,849 219,231
Power 28,004 31,873 135,151 127,020
Wireless 22,387   19,527   64,284   86,229  
Total net sales 90,473 101,184 369,284 432,480
 
Operating profit (loss)
Network (285 ) 4,620 2,492 24,437
Power 1,336 3,670 9,275 6,466
Wireless (2,612 ) (2,455 ) (13,024 ) (13,941 )

Operating loss excluding severance, impairment and other associated costs and costs related to unsolicited takeover attempt

(1,561 ) 5,835 (1,257 ) 16,962
Severance, impairment and other associated costs 1,128 1,705 14,719 32,799
Costs related to unsolicited takeover attempt --   --   1,916   --  
Operating (loss) profit (2,689 ) 4,130 (17,892 ) (15,837 )
 
             
FINANCIAL POSITION (UNAUDITED)
(in thousands) 12/30/2011 12/31/2010
 
Cash and cash equivalents $ 17,606 $ 35,905
Accounts receivable, net 59,507 65,532
Inventory 36,968 35,741
Prepaid expenses and other current assets 19,842 14,804
Net property, plant and equipment 28,605 30,681
Other assets   10,909     41,936
Total assets 173,437 224,599
 
Accounts payable 52,802 46,102
Accrued expenses and other current liabilities 42,855 54,602
Long-term debt 43,950 32,150
Convertible senior notes 50,000 50,000
Other long-term liabilities   21,650     18,971
Total liabilities 211,257 201,825
 
Total (deficit) equity   (37,820 )   22,774
 
Total liabilities and equity 173,437 224,599
 
Shares outstanding 41,980 41,490
 
         

Schedule A

NON-GAAP MEASURES (UNAUDITED)
(in thousands, except per-share amounts)
 
1. Adjusted EBITDA
 

Quarter Ended

12/30/11

12/31/10

 
Net (loss) earnings attributable to Pulse Electronics Corporation $ (43,316 ) $ 1,181
Net (earnings) loss from discontinued operations 370 699
Non-controlling interest (62 ) 273
Income tax expense 37,303 659
Interest expense, net 1,834 1,105
Non-cash stock-based compensation expenses 641 260
Depreciation and amortization 2,099 3,362
Other expense 1,182 213
Severance, impairment and other associated costs 1,128 1,705
Other adjustment: defined benefit plan curtailment gain   --     (1,031 )
Adjusted EBITDA 1,179 8,426
 
 
2. Net earnings (loss) per diluted share from continuing operations excluding severance, impairment and other associated costs, costs related to unsolicited takeover attempt, non-cash stock-based compensation expenses and other adjustments
 

Quarter Ended

Twelve Month Ended

12/30/11

12/31/10

12/30/11

12/31/10

 
Net (loss) earnings per diluted share $ (1.05 ) $ 0.03 $ (1.30 ) $ (0.94 )
Diluted (earnings) loss per share from discontinued operations 0.01 0.02 -- 0.24
After-tax severance, impairment and other associated costs, per share 0.02 0.04 0.26 0.74
After-tax costs related to unsolicited takeover attempt, per share -- -- 0.03 0.02
After-tax non-cash stock-based compensation expenses, per share 0.01 0.01 0.03 0.05
Other adjustments: defined benefit plan curtailment gain, per share   --     (0.02 )   --     (0.02 )
Net earnings (loss) per diluted share from continuing operations excluding severance, impairment and other associated costs, non-cash stock-based compensation expense and other adjustments (1.01 ) 0.08 (0.98 ) 0.09
 
3. Operating (loss) profit excluding severance, impairment and other associated costs, costs related to unsolicited takeover attempt, non-cash stock-based compensation expenses and other adjustments
 

Quarter Ended

Twelve Month Ended

12/30/11

12/31/10

12/30/11

12/31/10

 
Operating (loss) profit $ (2,689 ) $ 4,130 $ (17,892 ) $ (15,837 )
Pre-tax severance, impairment and other associated costs 1,128 1,705 14,719 32,799
Pre-tax non-cash stock-based compensation expenses 641 260 1,624 1,253
Pre-tax costs related to unsolicited takeover attempt -- -- 1,916 --
Other adjustment: accelerated deprecation -- 357 -- 2,994
Other adjustment: defined benefit plan curtailment gain   --     (1,031 )   --     (1,031 )
Operating (loss) profit excluding severance, impairment and other associated costs, non-cash stock-based compensation expense and other adjustments (920 ) 5,421 367 20,178
 
Net sales $ 90,473 $ 101,184 $ 369,284 $ 432,480
Operating margin excluding severance, impairment and other associated costs, costs related to unsolicited takeover attempt, non-cash stock-based compensation expense and other adjustments -1.0 % 5.4 % 0.1 % 4.7 %
 




Stock quotes in this article: PULS 

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