LFUS 8-K
Littelfuse Inc /De (LFUS)
8-K
2024-07-30
For: 2024-07-30
View Original
Added on
April 10, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
| WASHINGTON, D.C. 20579 | ||
FORM 8-K
| CURRENT REPORT | ||
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: July 30, 2024
(Date of earliest event reported)
LITTELFUSE, INC.
(Exact name of registrant as specified in its charter)
| (State of other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (773 ) 628-1000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol | Name of exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition | ||||
The information contained within Item 2.02 of this Form 8-K and the Exhibits attached hereto shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
On July 30, 2024, Littelfuse, Inc. (the “Company”) issued a press release announcing the results of its operations for the quarter ended June 29, 2024. A copy of the press release is attached as Exhibit 99.1 to this Form 8-K and incorporated by reference to this Item 2.02 as if fully set forth herein. A copy of the press release will also be available on the Company’s website.
| Item 7.01 | Regulation FD Disclosure | ||||
To supplement the information in the attached press release, the Company has also prepared a presentation, which will be available on the Company’s website at https://investor.littelfuse.com/events-and-presentations and is attached hereto as Exhibit 99.2 to this Current Report on Form 8-K.
The information contained in the press release and investor presentation attached to this Form 8-K includes forward-looking statements that are intended to be covered by the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include but are not limited to comments with respect to the objectives and strategies, financial condition, results of operations and business of the Company. These forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and the risk that predictions and other forward-looking statements will not be achieved. The Company cautions you not to place undue reliance on these forward-looking statements as a number of important factors could cause actual future results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements.
A copy of the press release is also posted on the Company's website.
| Item 9.01 | Financial Statements and Exhibits. | ||||
| (d) | Exhibits | |||||||
| The following exhibit is furnished with this Form 8-K: | ||||||||
| 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) | ||||||||
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Littelfuse, Inc. | |||||
Date: July 30, 2024 | By: /s/ Meenal A. Sethna | ||||
| Meenal A. Sethna Executive Vice President and Chief Financial Officer | |||||
Exhibit 99.1
 |  | ||||
FOR IMMEDIATE RELEASE David Kelley 224-727-2535 | |||||
LITTELFUSE REPORTS SECOND QUARTER RESULTS FOR 2024
Diverse and resilient business model drive Q2 sales and adjusted EPS above guidance
CHICAGO, July 30, 2024 - Littelfuse, Inc. (NASDAQ: LFUS), a diversified, industrial technology manufacturing company empowering a sustainable, connected, and safer world, today reported financial results for the second quarter ended June 29, 2024:
•Net sales of $558 million were down 9% versus the prior year period, and down 8% organically
•GAAP diluted EPS was $1.82 and adjusted diluted EPS was $1.97
•Cash flow from operations was $69 million and free cash flow was $50 million
•The company’s Board of Directors approved an 8% increase in the quarterly cash dividend from $0.65 to $0.70; this equates to an annualized dividend of $2.80 per share
•On June 26, the company released its 2023 Sustainability Report on littelfuse.com/about-us/sustainability
“We are pleased to have exceeded the high end of our second quarter sales and adjusted EPS guidance ranges, driven by solid execution from our global teams and supported by our resilient business model and diverse technology positioning.” said Dave Heinzmann, Littelfuse President and Chief Executive Officer. “Looking ahead, we remain confident in an expected return to growth during 2024, likely in the fourth quarter. We see some pockets of normalized channel inventory and improving end demand but also ongoing signs of cautiousness from customers. We remain well positioned to execute our proven long-term growth strategy and deliver top tier stakeholder value.”
Third Quarter of 2024*
Based on current market conditions, for the third quarter the company expects,
•Net sales in the range of $540 - $570 million, adjusted diluted EPS in the range of $1.95 - $2.15 and an adjusted effective tax rate of approximately 26%
*Littelfuse provides guidance on a non-GAAP (adjusted) basis. GAAP items excluded from guidance may include the after-tax impact of items including acquisition and integration costs, restructuring, impairment and other charges, certain purchase accounting adjustments, non-operating foreign exchange adjustments and significant and unusual items. These items are uncertain, depend on various factors, and could be material to results computed in accordance with GAAP. Littelfuse is not able to forecast the excluded items in order to provide the most directly comparable GAAP financial measure without unreasonable efforts.
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Dividend and Share Repurchase Authorization
•The company will pay a cash dividend on its common stock of $0.70 per share on September 5, 2024, to shareholders of record as of August 22, 2024
Conference Call and Webcast Information
Littelfuse will host a conference call on Wednesday, July 31, 2024, at 9:00 a.m. Central Time to discuss the results. The call will be broadcast and available for replay at Littelfuse.com. A slide presentation is available in the Investor Relations section of the company’s website at Littelfuse.com.
About Littelfuse
Littelfuse, Inc. (NASDAQ: LFUS) is a diversified, industrial technology manufacturing company empowering a sustainable, connected, and safer world. Across more than 20 countries, and with approximately 16,000 global associates, we partner with customers to design and deliver innovative, reliable solutions. Serving over 100,000 end customers, our products are found in a variety of industrial, transportation and electronics end markets – everywhere, every day. Learn more at Littelfuse.com.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995
The statements in this press release that are not historical facts are intended to constitute "forward-looking statements" entitled to the safe-harbor provisions of the Private Securities Litigation Reform Act. Such statements are based on Littelfuse, Inc.’s (“Littelfuse” or the “Company”) current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties, include, but are not limited to, risks and uncertainties relating to general economic conditions; product demand and market acceptance; the impact of competitive products and pricing; product quality problems or product recalls; capacity and supply difficulties or constraints; coal mining exposures reserves; cybersecurity matters; failure of an indemnification for environmental liability; exchange rate fluctuations; commodity and other raw material price fluctuations; the effect of Littelfuse accounting policies; labor disputes; restructuring costs in excess of expectations; pension plan asset returns less than assumed; integration of acquisitions; uncertainties related to political or regulatory changes; and other risks which may be detailed in the company's Securities and Exchange Commission filings. Should one or more of these risks or uncertainties materialize or should the underlying assumptions prove incorrect, actual results and outcomes may differ materially from those indicated or implied in the forward-looking statements. This release should be read in conjunction with information provided in the financial statements appearing in the company's Annual Report on Form 10-K for the year ended December 30, 2023.
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Further discussion of the risk factors of the company can be found under the caption "Risk Factors" in the company's Annual Report on Form 10-K for the year ended December 30, 2023, and in other filings and submissions with the SEC, each of which are available free of charge on the company’s investor relations website at investor.littelfuse.com and on the SEC’s website at www.sec.gov. These forward-looking statements are made as of the date hereof. The company does not undertake any obligation to update, amend or clarify these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the availability of new information.
Non-GAAP Financial Measures
The information included in this press release includes the non-GAAP financial measures of organic net sales (decline) growth, adjusted operating income, adjusted operating margin, adjusted EBITDA, adjusted EBITDA margin, adjusted diluted earnings per share, adjusted income taxes, adjusted effective tax rate, free cash flow, net debt, consolidated EBITDA, and consolidated net leverage ratio (as defined in the credit agreement). Many of these non-GAAP financial measures exclude the effect of certain expenses and income not related directly to the underlying performance of our fundamental business operations. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is set forth in the attached schedules. The company believes that organic net sales (decline) growth, adjusted operating income, adjusted operating margin, adjusted EBITDA, adjusted EBITDA margin, adjusted diluted earnings per share, adjusted income taxes, and adjusted effective tax rate provide useful information to investors regarding its operational performance because they enhance an investor’s overall understanding of our core financial performance and facilitate comparisons to historical results of operations, by excluding items that are not related directly to the underlying performance of our fundamental business operations or were not part of our business operations during a comparable period. The company believes that free cash flow is a useful measure of its ability to generate cash. The company believes that net debt, consolidated EBITDA, and consolidated net leverage ratio are useful measures of its credit position. The company believes that all of these non-GAAP financial measures are commonly used by financial analysts and others in the industries in which we operate, and thus further provide useful information to investors. Management additionally uses these measures when assessing the performance of the business and for business planning purposes. Note that our definitions of these non-GAAP financial measures may differ from those terms as defined or used by other companies.
LFUS-F
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| Littelfuse Inc. 8755 West Higgins Road, Suite 500 Chicago, Illinois 60631 p: (773) 628-1000 www.littelfuse.com | |||||
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LITTELFUSE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
| (Unaudited) | ||||||||||||||
| (in thousands, except share and per share data) | June 29, 2024 | December 30, 2023 | ||||||||||||
| ASSETS | ||||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 561,742 | $ | 555,513 | ||||||||||
| Short-term investments | 971 | 235 | ||||||||||||
| Trade receivables, less allowances of $73,744 and $84,696 at June 29, 2024 and December 30, 2023, respectively | 317,963 | 287,018 | ||||||||||||
| Inventories | 451,186 | 474,607 | ||||||||||||
| Prepaid income taxes and income taxes receivable | 6,413 | 8,701 | ||||||||||||
| Prepaid expenses and other current assets | 125,703 | 82,526 | ||||||||||||
| Total current assets | 1,463,978 | 1,408,600 | ||||||||||||
| Net property, plant, and equipment | 472,537 | 493,153 | ||||||||||||
| Intangible assets, net of amortization | 566,030 | 606,136 | ||||||||||||
| Goodwill | 1,287,762 | 1,309,998 | ||||||||||||
| Investments | 22,904 | 24,821 | ||||||||||||
| Deferred income taxes | 10,950 | 10,486 | ||||||||||||
| Right of use lease assets | 59,563 | 62,370 | ||||||||||||
| Other long-term assets | 41,254 | 79,711 | ||||||||||||
| Total assets | $ | 3,924,978 | $ | 3,995,275 | ||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable | $ | 176,095 | $ | 173,535 | ||||||||||
| Accrued liabilities | 135,180 | 149,214 | ||||||||||||
| Accrued income taxes | 39,235 | 38,725 | ||||||||||||
| Current portion of long-term debt | 67,679 | 14,020 | ||||||||||||
| Total current liabilities | 418,189 | 375,494 | ||||||||||||
| Long-term debt, less current portion | 795,825 | 857,915 | ||||||||||||
| Deferred income taxes | 96,214 | 110,820 | ||||||||||||
| Accrued post-retirement benefits | 31,810 | 34,422 | ||||||||||||
| Non-current lease liabilities | 49,581 | 49,472 | ||||||||||||
| Other long-term liabilities | 67,872 | 86,671 | ||||||||||||
| Total equity | 2,465,487 | 2,480,481 | ||||||||||||
| Total liabilities and equity | $ | 3,924,978 | $ | 3,995,275 | ||||||||||
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LITTELFUSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME
(Unaudited)
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (in thousands, except per share data) | June 29, 2024 | July 1, 2023 | June 29, 2024 | July 1, 2023 | ||||||||||||||||||||||
| Net sales | $ | 558,489 | $ | 611,997 | $ | 1,093,874 | $ | 1,221,779 | ||||||||||||||||||
| Cost of sales | 351,485 | 377,165 | 699,062 | 741,990 | ||||||||||||||||||||||
| Gross profit | 207,004 | 234,832 | 394,812 | 479,789 | ||||||||||||||||||||||
| Selling, general, and administrative expenses | 93,371 | 94,543 | 179,498 | 182,853 | ||||||||||||||||||||||
| Research and development expenses | 27,146 | 24,496 | 54,813 | 51,786 | ||||||||||||||||||||||
| Amortization of intangibles | 15,729 | 16,885 | 31,554 | 33,751 | ||||||||||||||||||||||
| Restructuring, impairment, and other charges | 5,252 | 6,855 | 8,489 | 8,705 | ||||||||||||||||||||||
| Total operating expenses | 141,498 | 142,779 | 274,354 | 277,095 | ||||||||||||||||||||||
| Operating income | 65,506 | 92,053 | 120,458 | 202,694 | ||||||||||||||||||||||
| Interest expense | 9,975 | 10,056 | 19,586 | 19,702 | ||||||||||||||||||||||
| Foreign exchange gain | (315) | (1,404) | (5,357) | (3,079) | ||||||||||||||||||||||
| Other income, net | (5,298) | (2,050) | (10,619) | (8,283) | ||||||||||||||||||||||
| Income before income taxes | 61,144 | 85,451 | 116,848 | 194,354 | ||||||||||||||||||||||
| Income taxes | 15,678 | 15,380 | 22,930 | 35,538 | ||||||||||||||||||||||
| Net income | $ | 45,466 | $ | 70,071 | $ | 93,918 | $ | 158,816 | ||||||||||||||||||
| Earnings per share: | ||||||||||||||||||||||||||
| Basic | $ | 1.83 | $ | 2.82 | $ | 3.78 | $ | 6.40 | ||||||||||||||||||
| Diluted | $ | 1.82 | $ | 2.79 | $ | 3.75 | $ | 6.33 | ||||||||||||||||||
| Weighted-average shares and equivalent shares outstanding: | ||||||||||||||||||||||||||
| Basic | 24,822 | 24,839 | 24,867 | 24,810 | ||||||||||||||||||||||
| Diluted | 25,030 | 25,095 | 25,075 | 25,078 | ||||||||||||||||||||||
| Comprehensive income | $ | 24,399 | $ | 55,160 | $ | 42,560 | $ | 157,188 | ||||||||||||||||||
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LITTELFUSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Six Months Ended | ||||||||||||||
| (in thousands) | June 29, 2024 | July 1, 2023 | ||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | 93,918 | $ | 158,816 | ||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | 73,161 | 83,347 | ||||||||||||
| Changes in operating assets and liabilities: | ||||||||||||||
| Trade receivables | (36,474) | (30,562) | ||||||||||||
| Inventories | 16,241 | 26,638 | ||||||||||||
| Accounts payable | 6,819 | (33,796) | ||||||||||||
| Accrued liabilities and income taxes | (28,829) | (57,790) | ||||||||||||
| Prepaid expenses and other assets | 1,738 | 4,980 | ||||||||||||
| Net cash provided by operating activities | 126,574 | 151,633 | ||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Acquisitions of businesses, net of cash acquired | — | (158,260) | ||||||||||||
| Purchases of property, plant, and equipment | (34,674) | (41,501) | ||||||||||||
| Net proceeds from sale of property, plant and equipment, and other | 7,997 | 741 | ||||||||||||
| Net cash used in investing activities | (26,677) | (199,020) | ||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Net payments of credit facility | (3,750) | (3,750) | ||||||||||||
| Repurchases of common stock | (40,862) | — | ||||||||||||
| Cash dividends paid | (32,330) | (29,790) | ||||||||||||
| All other cash (used in) provided by financing activities | (2,348) | 854 | ||||||||||||
| Net cash used in financing activities | (79,290) | (32,686) | ||||||||||||
| Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (14,434) | (1,772) | ||||||||||||
| Increase (decrease) in cash, cash equivalents, and restricted cash | 6,173 | (81,845) | ||||||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | 557,123 | 564,939 | ||||||||||||
| Cash, cash equivalents, and restricted cash at end of period | $ | 563,296 | $ | 483,094 | ||||||||||
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LITTELFUSE, INC.
NET SALES AND OPERATING INCOME BY SEGMENT
(Unaudited)
| Second Quarter | Year-to-Date | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2024 | 2023 | % (Decline) / Growth | 2024 | 2023 | % (Decline) / Growth | ||||||||||||||||||||||||||||||||
| Net sales | ||||||||||||||||||||||||||||||||||||||
| Electronics | $ | 305,639 | $ | 350,147 | (12.7) | % | $ | 596,744 | $ | 708,740 | (15.8) | % | ||||||||||||||||||||||||||
| Transportation | 168,964 | 172,048 | (1.8) | % | 339,331 | 338,689 | 0.2 | % | ||||||||||||||||||||||||||||||
| Industrial | 83,886 | 89,802 | (6.6) | % | 157,799 | 174,350 | (9.5) | % | ||||||||||||||||||||||||||||||
| Total net sales | $ | 558,489 | $ | 611,997 | (8.7) | % | $ | 1,093,874 | $ | 1,221,779 | (10.5) | % | ||||||||||||||||||||||||||
| Operating income | ||||||||||||||||||||||||||||||||||||||
| Electronics | $ | 46,165 | $ | 79,844 | (42.2) | % | $ | 83,968 | $ | 170,006 | (50.6) | % | ||||||||||||||||||||||||||
| Transportation | 15,234 | 7,789 | 95.6 | % | 31,440 | 16,321 | 92.6 | % | ||||||||||||||||||||||||||||||
| Industrial | 9,547 | 15,108 | (36.8) | % | 14,343 | 32,249 | (55.5) | % | ||||||||||||||||||||||||||||||
| Other(a) | (5,440) | (10,688) | N.M. | (9,293) | (15,882) | N.M. | ||||||||||||||||||||||||||||||||
| Total operating income | $ | 65,506 | $ | 92,053 | (28.8) | % | $ | 120,458 | $ | 202,694 | (40.6) | % | ||||||||||||||||||||||||||
| Operating Margin | 11.7 | % | 15.0 | % | 11.0 | % | 16.6 | % | ||||||||||||||||||||||||||||||
| Interest expense | 9,975 | 10,056 | 19,586 | 19,702 | ||||||||||||||||||||||||||||||||||
| Foreign exchange gain | (315) | (1,404) | (5,357) | (3,079) | ||||||||||||||||||||||||||||||||||
| Other income, net | (5,298) | (2,050) | (10,619) | (8,283) | ||||||||||||||||||||||||||||||||||
| Income before income taxes | $ | 61,144 | $ | 85,451 | (28.4) | % | $ | 116,848 | $ | 194,354 | (39.9) | % | ||||||||||||||||||||||||||
(a) "other" typically includes non-GAAP adjustments such as acquisition-related and integration costs, purchase accounting inventory adjustments and restructuring and impairment charges. (See Supplemental Financial Information for details.)
N.M. - Not meaningful
| Second Quarter | Year-to-Date | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2024 | 2023 | % (Decline)/Growth | 2024 | 2023 | % (Decline)/Growth | ||||||||||||||||||||||||||||||||
| Operating Margin | ||||||||||||||||||||||||||||||||||||||
| Electronics | 15.1 | % | 22.8 | % | (7.7) | % | 14.1 | % | 24.0 | % | (9.9) | % | ||||||||||||||||||||||||||
| Transportation | 9.0 | % | 4.5 | % | 4.5 | % | 9.3 | % | 4.8 | % | 4.5 | % | ||||||||||||||||||||||||||
| Industrial | 11.4 | % | 16.8 | % | (5.4) | % | 9.1 | % | 18.5 | % | (9.4) | % | ||||||||||||||||||||||||||
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LITTELFUSE, INC.
SUPPLEMENTAL FINANCIAL INFORMATION
(In millions of USD except per share amounts - unaudited)
| Non-GAAP EPS reconciliation | ||||||||||||||||||||||||||
| Q2-24 | Q2-23 | YTD-24 | YTD-23 | |||||||||||||||||||||||
| GAAP diluted EPS | $ | 1.82 | $ | 2.79 | $ | 3.75 | $ | 6.33 | ||||||||||||||||||
| EPS impact of Non-GAAP adjustments (below) | 0.15 | 0.33 | (0.02) | 0.42 | ||||||||||||||||||||||
| Adjusted diluted EPS | $ | 1.97 | $ | 3.12 | $ | 3.73 | $ | 6.75 | ||||||||||||||||||
| Non-GAAP adjustments - (income) / expense | ||||||||||||||||||||||||||
| Q2-24 | Q2-23 | YTD-24 | YTD-23 | |||||||||||||||||||||||
| Acquisition-related and integration costs (a) | $ | 0.8 | $ | 3.8 | $ | 1.8 | $ | 7.2 | ||||||||||||||||||
| Restructuring, impairment and other charges (b) | 5.3 | 6.9 | 8.5 | 8.7 | ||||||||||||||||||||||
| Gain on sale of fixed assets (c) | (0.7) | — | (1.0) | — | ||||||||||||||||||||||
| Non-GAAP adjustments to operating income | 5.4 | 10.7 | 9.3 | 15.9 | ||||||||||||||||||||||
| Other income, net (d) | (0.5) | — | (0.3) | (0.2) | ||||||||||||||||||||||
| Non-operating foreign exchange gain | (0.3) | (1.4) | (5.4) | (3.1) | ||||||||||||||||||||||
| Non-GAAP adjustments to income before income taxes | 4.6 | 9.3 | 3.6 | 12.6 | ||||||||||||||||||||||
| Income taxes (e) | 0.7 | 1.0 | 4.1 | 1.9 | ||||||||||||||||||||||
| Non-GAAP adjustments to net income | $ | 3.9 | $ | 8.3 | $ | (0.5) | $ | 10.7 | ||||||||||||||||||
| Total EPS impact | $ | 0.15 | $ | 0.33 | $ | (0.02) | $ | 0.42 | ||||||||||||||||||
| Adjusted operating margin / Adjusted EBITDA reconciliation | ||||||||||||||||||||||||||
| Q2-24 | Q2-23 | YTD-24 | YTD-23 | |||||||||||||||||||||||
| Net income | $ | 45.5 | $ | 70.1 | $ | 93.9 | $ | 158.8 | ||||||||||||||||||
| Add: | ||||||||||||||||||||||||||
| Income taxes | 15.7 | 15.4 | 22.9 | 35.5 | ||||||||||||||||||||||
| Interest expense | 10.0 | 10.1 | 19.6 | 19.7 | ||||||||||||||||||||||
| Foreign exchange gain | (0.3) | (1.4) | (5.4) | (3.1) | ||||||||||||||||||||||
| Other income, net | (5.3) | (2.1) | (10.6) | (8.3) | ||||||||||||||||||||||
| GAAP operating income | $ | 65.5 | $ | 92.1 | $ | 120.5 | $ | 202.7 | ||||||||||||||||||
| Non-GAAP adjustments to operating income | 5.4 | 10.7 | 9.3 | 15.9 | ||||||||||||||||||||||
| Adjusted operating income | $ | 70.9 | $ | 102.8 | $ | 129.8 | $ | 218.6 | ||||||||||||||||||
| Amortization of intangibles | 15.7 | 16.9 | 31.6 | 33.8 | ||||||||||||||||||||||
| Depreciation expenses | 17.1 | 18.0 | 33.7 | 35.6 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 103.7 | $ | 137.7 | $ | 195.0 | $ | 288.0 | ||||||||||||||||||
| Net sales | $ | 558.5 | $ | 612.0 | $ | 1,093.9 | $ | 1,221.8 | ||||||||||||||||||
| Net income as a percentage of net sales | 8.1 | % | 11.5 | % | 8.6 | % | 13.0 | % | ||||||||||||||||||
| Operating margin | 11.7 | % | 15.0 | % | 11.0 | % | 16.6 | % | ||||||||||||||||||
| Adjusted operating margin | 12.7 | % | 16.8 | % | 11.9 | % | 17.9 | % | ||||||||||||||||||
| Adjusted EBITDA margin | 18.6 | % | 22.5 | % | 17.8 | % | 23.6 | % | ||||||||||||||||||
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| Adjusted EBITDA by Segment | Q2-24 | Q2-23 | ||||||||||||||||||||||||||||||||||||
| Electronics | Transportation | Industrial | Electronics | Transportation | Industrial | |||||||||||||||||||||||||||||||||
| GAAP operating income | $ | 46.2 | $ | 15.2 | $ | 9.5 | $ | 79.8 | $ | 7.8 | $ | 15.1 | ||||||||||||||||||||||||||
| Add: | ||||||||||||||||||||||||||||||||||||||
| Add back amortization | 9.8 | 3.3 | 2.6 | 10.1 | 4.2 | 2.7 | ||||||||||||||||||||||||||||||||
| Add back depreciation | 10.0 | 5.8 | 1.3 | 9.7 | 6.9 | 1.4 | ||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 66.0 | $ | 24.3 | $ | 13.4 | $ | 99.6 | $ | 18.9 | $ | 19.2 | ||||||||||||||||||||||||||
| Adjusted EBITDA Margin | 21.6 | % | 14.4 | % | 16.0 | % | 28.5 | % | 11.0 | % | 21.4 | % | ||||||||||||||||||||||||||
| Adjusted EBITDA by Segment | YTD-24 | YTD-23 | ||||||||||||||||||||||||||||||||||||
| Electronics | Transportation | Industrial | Electronics | Transportation | Industrial | |||||||||||||||||||||||||||||||||
| GAAP operating income | $ | 84.0 | $ | 31.4 | $ | 14.3 | $ | 170.0 | $ | 16.3 | $ | 32.2 | ||||||||||||||||||||||||||
| Add: | ||||||||||||||||||||||||||||||||||||||
| Add back amortization | 19.7 | 6.8 | 5.1 | 20.3 | 8.6 | 4.9 | ||||||||||||||||||||||||||||||||
| Add back depreciation | 19.9 | 11.0 | 2.8 | 19.5 | 13.6 | 2.5 | ||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 123.6 | $ | 49.2 | $ | 22.2 | $ | 209.9 | $ | 38.5 | $ | 39.6 | ||||||||||||||||||||||||||
| Adjusted EBITDA Margin | 20.7 | % | 14.5 | % | 14.1 | % | 29.6 | % | 11.4 | % | 22.7 | % | ||||||||||||||||||||||||||
| Net sales reconciliation | Q2-24 vs. Q2-23 | |||||||||||||||||||||||||
| Electronics | Transportation | Industrial | Total | |||||||||||||||||||||||
| Net sales decline | (13) | % | (2) | % | (7) | % | (9) | % | ||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Acquisitions | — | % | — | % | — | % | — | % | ||||||||||||||||||
| FX impact | (1) | % | (1) | % | (1) | % | (1) | % | ||||||||||||||||||
| Organic net sales decline | (12) | % | (1) | % | (6) | % | (8) | % | ||||||||||||||||||
| Net sales reconciliation | YTD-24 vs. YTD-23 | |||||||||||||||||||||||||
| Electronics | Transportation | Industrial | Total | |||||||||||||||||||||||
| Net sales (decline) growth | (16) | % | — | % | (9) | % | (10) | % | ||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Acquisitions | — | % | — | % | 1 | % | — | % | ||||||||||||||||||
| FX impact | (1) | % | (1) | % | — | % | — | % | ||||||||||||||||||
| Organic net sales (decline) growth | (15) | % | 1 | % | (10) | % | (10) | % | ||||||||||||||||||
| Income tax reconciliation | ||||||||||||||||||||||||||
| Q2-24 | Q2-23 | YTD-24 | YTD-23 | |||||||||||||||||||||||
| Income taxes | $ | 15.7 | $ | 15.4 | $ | 22.9 | $ | 35.5 | ||||||||||||||||||
| Effective rate | 25.6 | % | 18.0 | % | 19.6 | % | 18.3 | % | ||||||||||||||||||
| Non-GAAP adjustments - income taxes | 0.7 | 1.0 | 4.1 | 1.9 | ||||||||||||||||||||||
| Adjusted income taxes | $ | 16.4 | $ | 16.4 | $ | 27.0 | $ | 37.4 | ||||||||||||||||||
| Adjusted effective rate | 25.0 | % | 17.4 | % | 22.4 | % | 18.1 | % | ||||||||||||||||||
| Free cash flow reconciliation | ||||||||||||||||||||||||||
| Q2-24 | Q2-23 | YTD-24 | YTD-23 | |||||||||||||||||||||||
| Net cash provided by operating activities | $ | 69.4 | $ | 98.2 | $ | 126.6 | $ | 151.6 | ||||||||||||||||||
| Less: Purchases of property, plant and equipment | (19.1) | (15.8) | (34.7) | (41.5) | ||||||||||||||||||||||
| Free cash flow | $ | 50.3 | $ | 82.4 | $ | 91.9 | $ | 110.1 | ||||||||||||||||||
Page 10
| Consolidated Total Debt | As of June 29, 2024 | |||||||
| Consolidated Total Debt | $ | 863.5 | ||||||
| Unamortized debt issuance costs | 3.3 | |||||||
| Finance lease liability | 0.4 | |||||||
| Consolidated funded indebtedness | 867.2 | |||||||
| Cash held in U.S. (up to $400 million) | 102.1 | |||||||
| Net debt | $ | 765.1 | ||||||
| Consolidated EBITDA | Twelve Months Ended June 29, 2024 | |||||||
| Net Income | $ | 194.5 | ||||||
| Interest expense | 39.7 | |||||||
| Income taxes | 56.5 | |||||||
| Depreciation | 69.7 | |||||||
| Amortization | 63.6 | |||||||
| Non-cash additions: | ||||||||
| Stock-based compensation expense | 24.5 | |||||||
| Purchase accounting inventory step-up charge | — | |||||||
| Unrealized loss on investments | 2.1 | |||||||
| Impairment charges | 1.9 | |||||||
| Other | 13.7 | |||||||
| Consolidated EBITDA (1) | $ | 466.2 | ||||||
| Consolidated Net Leverage Ratio (as defined in the Credit Agreement) * | 1.6x | |||||||
* Our Credit Agreement and Private Placement Note with maturities ranging from 2024 to 2032, contain financial ratio covenants providing that if, as of the last day of each fiscal quarter, the Consolidated Net Leverage ratio at such time for the then most recently concluded period of four consecutive fiscal quarters of the Company exceeds 3.50:1.00, an Event of Default (as defined in the Credit Agreement and Private Placement Senior Notes) is triggered.
The Credit Agreement and Private Placement Senior Notes were amended in Q2 2022 and now allow for the addition of acquisition and integration costs up to 15% of Consolidated EBITDA and the netting of up to $400M of Available Cash (Cash held by US Subsidiaries).
(1) Represents Consolidated EBITDA as defined in our Credit Agreement and Private Placement Senior Notes and is calculated using the most recently concluded period of four consecutive quarters.
Note: Total will not always foot due to rounding.
(a) reflected in selling, general and administrative expenses ("SG&A").
(b) reflected in restructuring, impairment and other charges.
(c) 2024 amount reflected a gain of $0.7 million ($1.0 million year-to-date) recorded for the sale of two buildings within the Transportation segment.
(d) Q2 2024 included a reversal of $0.5 million for an asset retirement obligation charge related the disposal of a business in 2019. 2024 year-to-date also included $0.2 million increase in coal mining reserves, while 2023 amount included $0.2 million gain from the sale of a building within the Electronics segment.
(e) reflected the tax impact associated with the non-GAAP adjustments.
###
1 Q2 2024 EARNINGS RELEASE July 30, 2024
2Littelfuse, Inc. © 2024 Important Information About Littelfuse, Inc. This presentation does not constitute or form part of, and should not be construed as, an offer or solicitation to purchase or sell securities of Littelfuse, Inc. and no investment decision should be made based upon the information provided herein. Littelfuse strongly urges you to review its filings with the Securities and Exchange Commission, which can be found at investor.littelfuse.com. This website also provides additional information about Littelfuse. “Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995. The statements in this presentation that are not historical facts are intended to constitute "forward-looking statements" entitled to the safe-harbor provisions of the Private Securities Litigation Reform Act. Such statements are based on Littelfuse, Inc.’s ("Littelfuse" or the "Company") current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward- looking statements. These risks and uncertainties, include, but are not limited to, risks and uncertainties relating to general economic conditions; product demand and market acceptance; the impact of competitive products and pricing; product quality problems or product recalls; capacity and supply difficulties or constraints; coal mining exposures reserves; cybersecurity matters; failure of an indemnification for environmental liability; exchange rate fluctuations; commodity and other raw material price fluctuations; the effect of Littelfuse accounting policies; labor disputes; restructuring costs in excess of expectations; pension plan asset returns less than assumed; integration of acquisitions; uncertainties related to political or regulatory changes; and other risks which may be detailed in the company's Securities and Exchange Commission filings. Should one or more of these risks or uncertainties materialize or should the underlying assumptions prove incorrect, actual results and outcomes may differ materially from those indicated or implied in the forward-looking statements. This presentation should be read in conjunction with information provided in the financial statements appearing in the company's Annual Report on Form 10-K for the year ended December 30, 2023. Further discussion of the risk factors of the company can be found under the caption "Risk Factors" in the company's Annual Report on Form 10-K for the year ended December 30, 2023, and in other filings and submissions with the SEC, each of which are available free of charge on the company’s investor relations website at investor.littelfuse.com and on the SEC’s website at http://www.sec.gov. These forward-looking statements are made as of the date hereof. The company does not undertake any obligation to update, amend or clarify these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the availability of new information. Non-GAAP Financial Measures. The information included in this presentation includes the non-GAAP financial measures of organic net sales (decline) growth, adjusted operating margin, adjusted EBITDA margin, adjusted diluted earnings per share, adjusted effective tax rate, free cash flow, and consolidated net leverage ratio (as defined in the credit agreement). A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures are set forth in the appendix. The company believes that these non-GAAP financial measures provide useful information to investors regarding its operational performance because they enhance an investor’s overall understanding of our core financial performance and facilitate comparisons to historical results of operations, by excluding items that are not related directly to the underlying performance of our fundamental business operations or were not part of our business operations during a comparable period. The company believes that free cash flow is a useful measure of its ability to generate cash. The company believes that consolidated net leverage ratio is a useful measure of its credit position. Management additionally uses these measures when assessing the performance of the business and for business planning purposes. Note that our definitions of these non-GAAP financial measures may differ from those terms as defined or used by other companies. DISCLAIMERS
BUSINESS UPDATE Dave Heinzmann, President & CEO
4Littelfuse, Inc. © 2024 EXECUTIVE SUMMARY Strong Q2 performance; disciplined execution supports long-term growth strategy Solid Q2 execution & performance Q2 Sales & Adjusted EPS exceed the high end of guidance Solid YTD cash generation, flexible balance sheet Meaningful design-in activity, momentum with customers Portfolio optimization initiatives driving margin traction Sequential Electronics & Industrials segment margin expansion Continued progress with Transportation actions Confidence in expected return to growth in the fourth quarter Believe passive Electronics destocking is largely behind us, well positioned to support customers in rebound Ongoing soft industrial demand, executing through cycles
5Littelfuse, Inc. © 2024 2023 SUSTAINABILITY REPORT HIGHLIGHTS Framework and Disclosure Programs: Our Approach Sustainability isn’t just a concept; it’s integrated into our business strategy, processes, and daily actions. Innovation and collaboration are at the heart of our sustainability journey.
6Littelfuse, Inc. © 2024 2021 – 2025 GROWTH STRATEGY EMPOWERING A SUSTAINABLE, CONNECTED, AND SAFER WORLD Our capabilities, investments & diversification deliver significant value
7Littelfuse, Inc. © 2024 ELECTRONICS END MARKETS BROAD TECHNOLOGY CAPABILITIES, DIVERSE EXPOSURE Diverse end market dynamics: Strong 2Q data center volumes led by AI driven applications; broad demand softness Initial pockets of demand recovery; strong & persistent design-in activity through cycle Technologically diverse design win momentum across our global customer base Asia & NA data center wins across broad set of technologies & applications Multi-technology medical wins across Europe, Asia & NA Europe & Asia appliance wins spanning our diverse technology portfolio Q2 2024 Highlights
8Littelfuse, Inc. © 2024 TRANSPORTATION END MARKETS PRODUCT LEADERSHIP FOR A GLOBAL CUSTOMER BASE Benefiting from broad & balanced technology capabilities & global customer reach Core passenger vehicle product leadership, long- standing customer relationships Continued traction with commercial vehicle profitability initiatives amid ongoing soft end market dynamics Delivering meaningful wins across extensive range of transportation applications Multiple wins within battery management systems for key customers Continued wins across high & low voltage architectures Global commercial vehicle wins for a diverse range of applications Q2 2024 Highlights
9Littelfuse, Inc. © 2024 INDUSTRIAL END MARKETS EXECUTING WHILE DRIVING INNOVATIONS Disciplined execution while delivering innovative solutions Continued end demand softness, more pronounced impact to power semiconductor portfolio Supporting ongoing industry advancements toward next generation applications Diverse renewable wins for solar & wind customers HVAC evolutions for broad NA customer base Multi-technology wins for global EV charging infrastructure build out Q2 2024 Highlights
FINANCIAL UPDATE Meenal Sethna, EVP & CFO
11Littelfuse, Inc. © 2024 Q2 2024 TOTAL COMPANY FINANCIAL PERFORMANCE GAAP EPS $2.79 $1.82 Adj. EPS $3.12 $1.97 Adj. EBITDA% 22.5% 18.6% $612 $558 Q2-23 Q2-24 Revenue (in millions) See appendix for GAAP to non-GAAP reconciliation Highlights Revenue (-9%) vs PY / organic (-8%) ~2% portfolio pruning headwind GAAP op margin 11.7%; Adjusted op margin 12.7% F/X & Commodities: (-80bps) margin headwind vs. PY Effective tax rate: GAAP 26.0%; Adj. 25.0% Operating cash flow $69m; Free cash flow $50m YTD: Free cash flow $92m, 98% conversion rate
12Littelfuse, Inc. © 2024 CASH GENERATION & CAPITAL DEPLOYMENT Well-positioned business model & execution drive robust long- term cash generation Disciplined approach to working capital management Strong balance sheet supports capital deployment strategy Consolidated net leverage ratio ~1.6x Prioritizing growth investments YTD capital deployment - returned $73m to shareholders $41m via share repurchase $32m dividend payout; Board approved +8% increase Consistent prioritization of capital deployment Organic investments Strategic acquisitions Dividends and share repurchases See appendix for GAAP to non-GAAP reconciliation Driving long-term shareholder value
13Littelfuse, Inc. © 2024 $350 $306 Q2-23 Q2-24 Q2 2024 ELECTRONICS SEGMENT FINANCIAL PERFORMANCE Revenue (in millions) Op Margin 22.8% 15.1% Adj. EBITDA% 28.5% 21.6% Highlights See appendix for GAAP to non-GAAP reconciliation Revenue (-13%) vs PY / organic (-12%) Passive products (-4%) Semiconductor (-19%) Moderating passive inventory reductions, channel inventory levels have normalized into 2H; continued industrial softness & destock impacting semiconductor products Portfolio diversification efforts, execution driving margin resiliency
14Littelfuse, Inc. © 2024 $172 $169 Q2-23 Q2-24 Q2 2024 TRANSPORTATION SEGMENT FINANCIAL PERFORMANCE Revenue (in millions) Op Margin 4.5% 9.0% Adj. EBITDA% 11.0% 14.4% See appendix for GAAP to non-GAAP reconciliation Highlights Revenue growth (-2%) / organic (-1%) ~4% portfolio pruning headwind Passenger vehicle business (-1%) / organic +2% Solid global customer traction Commercial vehicle business (-3%) / organic (-3%) Headwind from ongoing end market softness; portfolio pruning Structural actions driving improved profitability Continued favorable pricing, pruning initiatives, cost reduction actions
15Littelfuse, Inc. © 2024 $90 $84 Q2-23 Q2-24 Q2 2024 INDUSTRIAL SEGMENT FINANCIAL PERFORMANCE Revenue Revenue (-7%) / organic (-6%) Continued industrial end markets softness...Construction / MRO, solar, EV infrastructure Initial signs of residential HVAC recovery; Continued industrial safety & energy storage growth Ongoing OEM inventory reductions Footprint optimization initiatives, execution driving margin expansion Sequential improvements op margin +490bps, adj. EBITDA margin +410bps (in millions) Op Margin 16.8% 11.4% Adj. EBITDA% 21.4% 16.0% See appendix for GAAP to non-GAAP reconciliation Highlights
16Littelfuse, Inc. © 2024 Q3 2024 GUIDANCE Macro view…continued dynamic environment but some positive signs Passive electronics destocking largely complete in 1H; some ongoing cautious order patterns Initial pockets of demand recovery Continued soft industrial end markets Persistent commodity headwinds Sales $540 - $570m Essentially flat relative to Q2 (-1%) F/X headwind vs. PY Adj. EPS $1.95 - $2.15 Expected adj. effective tax rate ~26% Headwinds vs. PY: F/X, Commodities and Tax rate ($0.25) EPS; (-50bps) margin (in millions) See appendix for GAAP to non-GAAP reconciliation $607 $558 $540 - $570 Q3-23 Q2-24 Q3-24 Revenue Adj. EPS $2.97 $1.97 $1.95 - $2.15 GAAP EPS $2.30 $1.82 - Highlights
17Littelfuse, Inc. © 2024 FULL YEAR 2024 CONSIDERATIONS / EXPECTATIONS Expect return to sales growth in the fourth quarter, net of portfolio initiatives headwind FY: Pruning impact…(-2%) Company, (-6%) Transportation Segment (heavier Comm. Vehicle) Full year ’24 margin expectations impacted by elongated inventory destocking cycle & end market weakness Company adj. operating margin ~12-14% By segment…Electronics mid-teens; Industrial low-teens; Transportation continued improvement, high single-digits at year end F/X & Commodities: (-1%) headwind to sales; ~($0.40) EPS, (-50bps) margin headwind at current rates Other Assumptions $63m amortization expense $39m interest expense; expect to offset ~2/3 with interest income from cash investment strategies Adj. effective tax rate ~23% Expect ~100% free cash flow conversion Projecting ~$100m investment in capital expenditures
18Littelfuse, Inc. © 2024 DIVERSIFICATION OF TECHNOLOGIES, END MARKETS & GEOGRAPHIES DELIVERS DOUBLE-DIGIT REVENUE & EARNINGS CAGR '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 '23 Revenue (M$) Adjusted EPS 15-year* CAGR: Sales +10% EPS +18% Strong track record of top tier financial performance Expanding leadership in core markets while prioritizing strategic investments to bolster diversified portfolio Flexible cost structure drives improved profitability through cycles Proven team with history of successfully executing through dynamic environments *2008 - 2023
19Littelfuse, Inc. © 2024 APPENDIX
20Littelfuse, Inc. © 2024 SUPPLEMENTAL FINANCIAL INFORMATION
21Littelfuse, Inc. © 2024 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D
22Littelfuse, Inc. © 2024 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D
23Littelfuse, Inc. © 2024 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D
24Littelfuse, Inc. © 2024 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D
25Littelfuse, Inc. © 2024 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D
26Littelfuse, Inc. © 2024 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D