Pulse Electronics Corporation (NYSE:PULS), a leading provider of electronic components, today reported results for its third quarter ended September 28, 2012.
Third Quarter Highlights
- Net sales were $88.2 million, down 8.1 percent from $96.0 million in the prior-year quarter, and down 12.1 percent from $100.4 million in the second quarter.
- Operating loss (U.S. GAAP) was $5.8 million compared with a loss of $0.7 million in the prior-year quarter and a loss of $0.1 million in the second quarter.
- Non-GAAP operating loss was $0.6 million, compared with a profit of $2.6 million in the prior-year quarter and a profit of $0.8 million in the second quarter. (See Schedule A for a reconciliation of U.S. GAAP results to non-GAAP measures.)
Additionally, the company and certain affiliates of investment funds managed by Oaktree Capital Management, L.P., an affiliate of Oaktree Capital Group, LLC (NYSE: OAK), a leading global investment management firm with approximately $81 billion under management, have entered into definitive agreements to recapitalize Pulse with a debt and equity investment of approximately $102.7 million in Pulse. At closing, Pulse intends to use the proceeds to repay $55 million outstanding under its senior credit agreement with its existing lenders and use $20 million for working capital and general business purposes. In addition, Oaktree has agreed to exchange $27.7 million of the company’s $50 million in outstanding 7% senior convertible notes due 2014. The new capital structure supports the company’s long term strategy and the execution of its business plans. The loan has a five-year term and will allow Pulse to further strengthen its technology leadership in the electronics components industry, continue the turnaround of its wireless business, and significantly reduce the amount of cash required for debt service. Pulse expects these transactions to close on or around November 19, 2012.