Littelfuse Reports Third Quarter Results

Littelfuse, Inc. (NASDAQ:LFUS) today reported financial results for the third quarter ended October 1, 2016.

Third Quarter Highlights

All comparisons are to the prior year period unless otherwise noted. A reconciliation of non-GAAP (adjusted) financial measures used in this release to the comparable GAAP financial measures is included below.
  • Sales for the third quarter of 2016 were $280.3 million, a 30% increase. Excluding revenue from acquisitions, sales increased 2%, led by strong growth in the automotive segment partially offset by end market softness in the industrial segment.
  • GAAP earnings for the third quarter of 2016 were $1.35 per diluted share. The third quarter GAAP effective tax rate of (1.2%) included a year-to-date adjustment to a 15.6% effective tax rate. Included in GAAP earnings were $17.4 million of pretax special charges. The primary item was $14.8 million in pretax non-cash impairment charges related to the custom business within the industrial segment, due to continued end market softness in the potash mining market.
  • Excluding special items, adjusted earnings for the third quarter of 2016 were $1.87 per diluted share, representing a 31% increase. The third quarter adjusted effective tax rate of 11.2% included a year-to-date adjustment to an 18% adjusted effective tax rate.
  • Highlights by segment included:
    • Electronics sales increased 44% (4% excluding revenue from acquisitions), led by higher fuse and sensor sales.
    • Automotive sales increased 31% (7% excluding revenue from acquisitions), driven by strong growth in Asia.
    • Industrial sales decreased 16% primarily due to weakness in solar, mining, and oil and gas end markets.
  • The electronics book-to-bill ratio for the third quarter of 2016 was 0.99, which excludes the ON product portfolio acquisition.
  • Cash provided by operating activities was $64.7 million for the third quarter of 2016 compared to $51.6 million for the third quarter of 2015.
  • Capital expenditures for the third quarter of 2016 increased to $14.3 million compared to $8.6 million in the prior year. The increase was primarily due to capital spending for new acquisitions and integration related activities.
  • As announced on October 25 th, the company completed the sale of its portable electrical house (e-house) business, which was included in the company's custom business within the industrial segment.

"We're very pleased with our third quarter performance, led by our electronics and automotive segments as well as a sustained reduction in our tax rate," said Gordon Hunter, chief executive officer. "While we continued to face end market weakness across our industrial business, we took further action this quarter to improve profitability. On the acquisition front, we're ahead of our initial expectations with the PolySwitch integration, and off to a strong start with the ON product portfolio."

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