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Anixter International Inc. Reports Fourth Quarter 2012 Results

About Anixter

Anixter International is a leading global distributor of enterprise cabling and security solutions, electrical and electronic wire & cable, OEM supply fasteners and other small parts. The Company adds value to the distribution process by providing its customers access to 1) innovative inventory management programs, 2) more than 450,000 products and over $1 billion in inventory, 3) approximately 220 warehouses with 7 million square feet of space, and 4) locations in over 250 cities in more than 50 countries. Founded in 1957 and headquartered near Chicago, Anixter trades on the New York Stock Exchange under the symbol AXE.

Safe Harbor Statement

The statements in this news release that use such words as “believe,” “expect,” “intend,” “anticipate,” “contemplate,” “estimate,” “plan,” “project,” “should,” “may,” ”will,” or similar expressions are forward-looking statements. They are subject to a number of factors that could cause the company’s actual results to differ materially from what is indicated here. These factors include general economic conditions, the level of customer demand particularly for capital projects in the markets we serve, changes in supplier sales strategies or financial viability, risks associated with the sale of nonconforming products and services, political, economic or currency risks related to foreign operations, inventory obsolescence, copper price fluctuations, customer viability, risks associated with accounts receivable, the impact of regulation and regulatory, investigative and legal proceedings and legal compliance risks, and risks associated with integration of acquired companies. These uncertainties may cause our actual results to be materially different than those expressed in any forward looking statements. We do not undertake to update any forward looking statements. Please see the company’s Securities and Exchange Commission filings for more information.

Additional information about Anixter is available at anixter.com

   
ANIXTER INTERNATIONAL INC.
Condensed Consolidated Statements of Operations (Unaudited)    
   
 
Three Months Ended Twelve Months Ended
December 28, December 30, December 28, December 30,
(In millions, except per share amounts) 2012 2011 2012 2011
 
Net sales $ 1,544.4 $ 1,499.0 $ 6,253.1 $ 6,146.9
Cost of goods sold   1,201.5     1,150.3     4,844.4     4,739.5  
Gross profit 342.9 348.7 1,408.7 1,407.4
Operating expenses 283.0 257.1 1,077.7 1,044.6
Impairment of goodwill and long- lived assets   21.3     -     48.5     -  
Operating income 38.6 91.6 282.5 362.8
Interest expense (16.2 ) (12.0 ) (59.7 ) (50.1 )
Other, net   (1.8 )   (2.4 )   (13.6 )   (9.2 )
Income from continuing operations before taxes 20.6 77.2 209.2 303.5
Income tax expense   15.4     27.4     84.6     102.8  
Net income from continuing operations 5.2 49.8 124.6 200.7
(Loss) income from discontinued operations, net of tax   (0.1 )   (1.5 )   0.2     (12.5 )
Net income $ 5.1   $ 48.3   $ 124.8   $ 188.2  
 
Net income per share:
Basic:
Continuing operations $ 0.16 $ 1.50 $ 3.76 $ 5.87
Discontinued operations $ -   $ (0.05 ) $ 0.01   $ (0.37 )
Net income $ 0.16   $ 1.45   $ 3.77   $ 5.50  
Diluted:
Continuing operations $ 0.16 $ 1.49 $ 3.69 $ 5.71
Discontinued operations $ (0.01 ) $ (0.05 ) $ -   $ (0.35 )
Net income $ 0.15   $ 1.44   $ 3.69   $ 5.36  
 
Weighted average shares outstanding:
Basic 32.5 33.2 33.1 34.2
Diluted 33.1 33.5 33.8 35.1
 
Reporting Segments
Net sales:
Enterprise Cabling and Security Solutions $ 800.0 $ 809.2 $ 3,236.3 $ 3,245.3
Electrical and Electronic Wire and Cable 544.1 461.0 2,111.2 1,949.9
OEM Supply   200.3     228.8     905.6     951.7  
$ 1,544.4   $ 1,499.0   $ 6,253.1   $ 6,146.9  
Operating income:
Enterprise Cabling and Security Solutions $ 32.0 $ 48.7 $ 156.7 $ 184.8
Electrical and Electronic Wire and Cable 35.2 39.4 166.5 161.2
OEM Supply (28.6 ) 3.5 (29.9 ) 16.8
Corporate   -     -     (10.8 )   -  
$ 38.6   $ 91.6   $ 282.5   $ 362.8  
         
ANIXTER INTERNATIONAL INC.
Condensed Consolidated Balance Sheets
   
 
December 28, December 30,
(In millions) 2012 2011
(Unaudited)
Assets
 
Cash and cash equivalents $ 89.4 $ 106.1
Accounts receivable, net 1,225.5 1,151.0
Inventories 1,060.9 1,070.7
Deferred income taxes 40.7 37.7
Other current assets   33.6   37.4
Total current assets 2,450.1 2,402.9
 
Property and equipment, net 95.9 88.3
Goodwill 342.0 351.7
Other assets   201.6   191.1
Total assets $ 3,089.6 $ 3,034.0
 
Liabilities and Stockholders' Equity
 
Accounts payable $ 716.9 $ 706.5
Accrued expenses 249.5 317.4
Short-term debt   0.9   3.0
Total current liabilities 967.3 1,026.9
 
5.625% senior notes 350.0 -
1.0% convertible senior notes 297.8 280.3
5.95% senior notes 200.0 200.0
Accounts receivable securitization facility 82.0 175.0
10.0% senior notes 31.6 31.1
Revolving lines of credit and other 20.8 120.4
Other liabilities   170.2   199.1
Total liabilities 2,119.7 2,032.8
 
Stockholders' equity   969.9   1,001.2
$ 3,089.6 $ 3,034.0
 
Financial Measures That Supplement GAAP
This report includes certain financial measures computed using non-Generally Accepted Accounting Principles ("non-GAAP") components as defined by the Securities and Exchange Commission ("SEC"). The Company believes this information is useful to investors in order to provide a better understanding of the organic revenue growth trends of the Company on a comparable basis. Management does not use these non-GAAP financial measures for any purpose other than the reason stated above.
 
Organic revenue growth measures revenue excluding the effects of acquisitions, foreign exchange and copper pricing for comparison of current period results with the corresponding period of the prior year. The Company believes that this measure provides management and investors with a more complete understanding of underlying operating results and trends of established, ongoing operations by excluding the effect of acquisitions, foreign exchange and copper pricing, which are subject to volatility or can obscure underlying trends. Management recognizes that the term “organic revenue growth” may be interpreted differently by other companies and under different circumstances. Although this may have an effect on comparability of absolute percentage growth from company to company, the Company believes that these measures are useful in assessing trends of the Company business and may therefore be a useful tool in assessing period-to-period performance.
 
Fourth Quarter 2012 Sales Growth Trends (Unaudited)
    Fourth Quarter   Adjustments for:   Fourth Quarter  
2012 Acquisition   Foreign Exchange   Copper 2012 Fourth Quarter Organic
(as reported) Impact Impact Impact (as adjusted) 2011 Growth
(in millions)
Enterprise Cabling and Security Solutions
North America $ 577.9 $ - $ (2.0 ) $ - $ 575.9 $ 565.8 1.8 %
Europe 85.4 - 1.1 - 86.5 91.3 -5.1 %
Emerging Markets   136.7   -     (2.3 )   -     134.4   152.1 -11.7 %
Enterprise Cabling and Security $ 800.0 $ -   $ (3.2 ) $ -   $ 796.8 $ 809.2 -1.6 %
 
Electrical and Electronic Wire and Cable
North America $ 413.9 $ - $ (3.9 ) $ (4.2 ) $ 405.8 $ 365.5 11.0 %
Europe 72.5 - (0.9 ) (0.1 ) 71.5 77.2 -7.2 %
Emerging Markets   57.7   (31.0 )   (0.5 )   -     26.2   18.3 43.2 %
Electrical and Electronic Wire and Cable $ 544.1 $ (31.0 ) $ (5.3 ) $ (4.3 ) $ 503.5 $ 461.0 9.3 %
 
OEM Supply
North America $ 87.4 $ - $ - $ - $ 87.4 $ 99.7 -12.4 %
Europe 100.1 - 0.5 - 100.6 113.8 -11.8 %
Emerging Markets   12.8   -     (0.6 )   -     12.2   15.3 -19.1 %
OEM Supply $ 200.3 $ -   $ (0.1 ) $ -   $ 200.2 $ 228.8 -12.5 %
 
Total Anixter International $ 1,544.4 $ (31.0 ) $ (8.6 ) $ (4.3 ) $ 1,500.5 $ 1,499.0 0.1 %
 
Geographic Sales
North America $ 1,079.2 $ - $ (5.9 ) $ (4.2 ) $ 1,069.1 $ 1,031.0 3.7 %
Europe 258.0 - 0.7 (0.1 ) 258.6 282.3 -8.4 %
Emerging Markets   207.2   (31.0 )   (3.4 )   -     172.8   185.7 -6.9 %
Total Anixter International $ 1,544.4 $ (31.0 ) $ (8.6 ) $ (4.3 ) $ 1,500.5 $ 1,499.0 0.1 %
                               
Twelve Months Sales Growth Trends (Unaudited)
Twelve Months Adjustments for: Twelve Months
2012 Acquisition Foreign Exchange Copper 2012 Twelve Months Organic
(as reported) Impact Impact Impact (as adjusted) 2011 Growth
(in millions)
Enterprise Cabling and Security Solutions
North America $ 2,356.8 $ - $ 4.1 $ - $ 2,360.9 $ 2,301.3 2.6 %
Europe 338.5 - 15.5 - 354.0 380.8 -7.0 %
Emerging Markets   541.0   -     5.0     -     546.0   563.2 -3.1 %
Enterprise Cabling and Security $ 3,236.3 $ -   $ 24.6   $ -   $ 3,260.9 $ 3,245.3 0.5 %
 
Electrical and Electronic Wire and Cable
North America $ 1,662.0 $ - $ 6.9 $ 39.9 $ 1,708.8 $ 1,579.8 8.2 %
Europe 294.8 - 6.0 5.2 306.0 299.7 2.1 %
Emerging Markets   154.4   (62.8 )   1.7     -     93.3   70.4 32.6 %
Electrical and Electronic Wire and Cable $ 2,111.2 $ (62.8 ) $ 14.6   $ 45.1   $ 2,108.1 $ 1,949.9 8.1 %
 
OEM Supply
North America $ 405.9 $ - $ 0.1 $ - $ 406.0 $ 421.4 -3.7 %
Europe 438.6 - 18.5 - 457.1 469.5 -2.7 %
Emerging Markets   61.1   -     3.3     -     64.4   60.8 6.1 %
OEM Supply $ 905.6 $ -   $ 21.9   $ -   $ 927.5 $ 951.7 -2.5 %
 
Total Anixter International $ 6,253.1 $ (62.8 ) $ 61.1   $ 45.1   $ 6,296.5 $ 6,146.9 2.4 %
 
Geographic Sales
North America $ 4,424.7 $ - $ 11.1 $ 39.9 $ 4,475.7 $ 4,302.5 4.0 %
Europe 1,071.9 - 40.0 5.2 1,117.1 1,150.0 -2.9 %
Emerging Markets   756.5   (62.8 )   10.0     -     703.7   694.4 1.3 %
Total Anixter International $ 6,253.1 $ (62.8 ) $ 61.1   $ 45.1   $ 6,296.5 $ 6,146.9 2.4 %
                                                 




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