LFUS 8-K
Littelfuse Inc /De (LFUS)
8-K
2021-10-26
For: 2021-10-26
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: October 26, 2021
(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 October 26, 2021, Littelfuse, Inc. (the “Company”) issued a press release announcing the results of its operations for the quarter ended September 25, 2021. 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.
| Item 9.01 | Financial Statements and Exhibits. | ||||
| (d) | Exhibits | ||||
| The following exhibit is furnished with this Form 8-K: | |||||
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: October 26, 2021 | By: /s/ Meenal A. Sethna | ||||
| Meenal A. Sethna Executive Vice President and Chief Financial Officer | |||||
EXHIBIT INDEX
| Exhibit No. | Description | |||||||
| 99.1 | ||||||||
| 99.2 | ||||||||
| 101 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document. | |||||||
| 104 | The cover page from this Current Report on Form 8-K, formatted as Inline XBRL. | |||||||
Exhibit 99.1
 |  | ||||
| NEWS RELEASE | Littelfuse Inc. 8755 West Higgins Road, Suite 500 Chicago, Illinois 60631 p: (773) 628-1000 f: (773) 628-0802 www.littelfuse.com | ||||
LITTELFUSE REPORTS THIRD QUARTER RESULTS FOR 2021
Record sales and earnings driven by strong business fundamentals
CHICAGO, October 26, 2021 - Littelfuse, Inc. (NASDAQ: LFUS), an industrial technology manufacturing company empowering a sustainable, connected, and safer world, today reported financial results for the third quarter ended September 25, 2021:
•Net sales of $539.6 million primarily driven by stronger than expected demand across the electronics segment
•GAAP operating margin was 22.3%; adjusted operating margin was 22.8%
•GAAP diluted EPS of $3.69 and adjusted diluted EPS of $3.95
•Cash flow from operations was $114.3 million and free cash flow was $89.4 million
•On October 20, the company announced it has entered into a definitive agreement to acquire Carling Technologies, Inc., a global leader in switching, circuit protection, and power distribution technologies with a strong presence in commercial vehicle and telecom infrastructure markets; the company has annualized sales of approximately $170 million
“Our ability to effectively execute within this challenging environment enabled us to deliver a quarter of outstanding performance,” said Dave Heinzmann, Littelfuse President and Chief Executive Officer. “Across our global footprint, our highly skilled teams are continuously improving our operations to meet customer demand, and our results reflect their commitment and hard work. We also made further progress on our growth strategy and are excited to welcome Carling Technologies employees to the Littelfuse team. As we near the end of a challenging 2021, we are poised to achieve significant sales and earnings growth this year, and remain well-positioned to deliver ongoing superior value for our stakeholders.”
Fourth Quarter of 2021*
For the fourth quarter, the company expects net sales in the range of $503 to $517 million and adjusted diluted EPS in the range of $2.80 to $2.96.
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*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.
Dividend
•The company will pay a cash dividend on its common stock of $0.53 per share on December 2, 2021 to shareholders of record as of November 18, 2021
Conference Call and Webcast Information
Littelfuse will host a conference call on Wednesday, October 27, 2021, 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 (NASDAQ: LFUS) is an industrial technology manufacturing company empowering a sustainable, connected, and safer world. Across more than 15 countries, and with 12,000 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. These statements may involve risks and uncertainties, including, but not limited to, risks and uncertainties relating to general economic conditions; the severity and duration of the COVID-19 pandemic and the measures taken in response thereto and the effects of those items on the company’s business; 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, Inc.'s ("Littelfuse" or the "Company") 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 26, 2020.
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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 26, 2020, 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 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, consolidated total gross debt, consolidated EBITDA (as defined in the private placement senior notes), and ratio of consolidated total gross debt to consolidated EBITDA. 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 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 consolidated total gross debt, consolidated EBITDA, and ratio of consolidated total gross debt to consolidated EBITDA 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.
CONTACT: Trisha Tuntland
Head of Investor Relations
(773) 628-2163
LFUS-F
###
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LITTELFUSE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
| (Unaudited) | ||||||||||||||
| (in thousands) | September 25, 2021 | December 26, 2020 | ||||||||||||
| ASSETS | ||||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 690,682 | $ | 687,525 | ||||||||||
| Short-term investments | 28 | 54 | ||||||||||||
| Trade receivables, less allowances of $53,006 and $45,237 at September 25, 2021 and December 26, 2020, respectively | 325,739 | 232,760 | ||||||||||||
| Inventories | 357,024 | 258,002 | ||||||||||||
| Prepaid income taxes and income taxes receivable | 2,695 | 3,029 | ||||||||||||
| Prepaid expenses and other current assets | 59,768 | 35,939 | ||||||||||||
| Total current assets | 1,435,936 | 1,217,309 | ||||||||||||
| Net property, plant, and equipment | 364,329 | 344,178 | ||||||||||||
| Intangible assets, net of amortization | 295,766 | 291,887 | ||||||||||||
| Goodwill | 847,205 | 816,812 | ||||||||||||
| Investments | 39,885 | 30,547 | ||||||||||||
| Deferred income taxes | 9,575 | 11,224 | ||||||||||||
| Right of use lease assets, net | 24,375 | 17,615 | ||||||||||||
| Other assets | 21,447 | 18,021 | ||||||||||||
| Total assets | $ | 3,038,518 | $ | 2,747,593 | ||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable | $ | 221,889 | $ | 145,984 | ||||||||||
| Accrued liabilities | 139,670 | 110,478 | ||||||||||||
| Accrued income taxes | 32,462 | 19,186 | ||||||||||||
| Current portion of long-term debt | 27,619 | — | ||||||||||||
| Total current liabilities | 421,640 | 275,648 | ||||||||||||
| Long-term debt, less current portion | 620,112 | 687,034 | ||||||||||||
| Deferred income taxes | 50,365 | 50,134 | ||||||||||||
| Accrued post-retirement benefits | 42,026 | 45,802 | ||||||||||||
| Non-current operating lease liabilities | 17,440 | 12,950 | ||||||||||||
| Other long-term liabilities | 65,537 | 67,252 | ||||||||||||
| Total equity | 1,821,398 | 1,608,773 | ||||||||||||
| Total liabilities and equity | $ | 3,038,518 | $ | 2,747,593 | ||||||||||
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LITTELFUSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME
(Unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| (in thousands, except per share data) | September 25, 2021 | September 26, 2020 | September 25, 2021 | September 26, 2020 | ||||||||||||||||||||||
| Net sales | $ | 539,581 | $ | 391,566 | $ | 1,526,863 | $ | 1,044,999 | ||||||||||||||||||
| Cost of sales | 325,009 | 252,735 | 954,429 | 681,910 | ||||||||||||||||||||||
| Gross profit | 214,572 | 138,831 | 572,434 | 363,089 | ||||||||||||||||||||||
| Selling, general, and administrative expenses | 67,468 | 49,929 | 199,071 | 154,328 | ||||||||||||||||||||||
| Research and development expenses | 15,779 | 12,963 | 46,912 | 40,587 | ||||||||||||||||||||||
| Amortization of intangibles | 10,446 | 10,104 | 31,608 | 29,912 | ||||||||||||||||||||||
| Restructuring, impairment, and other charges | 772 | 1,277 | 1,998 | 40,904 | ||||||||||||||||||||||
| Total operating expenses | 94,465 | 74,273 | 279,589 | 265,731 | ||||||||||||||||||||||
| Operating income | 120,107 | 64,558 | 292,845 | 97,358 | ||||||||||||||||||||||
| Interest expense | 4,602 | 4,988 | 13,901 | 16,261 | ||||||||||||||||||||||
| Foreign exchange loss (gain) | 3,154 | (6,174) | 8,315 | (9,600) | ||||||||||||||||||||||
| Other income, net | (1,240) | (1,682) | (10,867) | (1,643) | ||||||||||||||||||||||
| Income before income taxes | 113,591 | 67,426 | 281,496 | 92,340 | ||||||||||||||||||||||
| Income taxes | 21,537 | 12,070 | 49,634 | 21,331 | ||||||||||||||||||||||
| Net income | $ | 92,054 | $ | 55,356 | $ | 231,862 | $ | 71,009 | ||||||||||||||||||
| Earnings per share: | ||||||||||||||||||||||||||
| Basic | $ | 3.74 | $ | 2.27 | $ | 9.43 | $ | 2.92 | ||||||||||||||||||
| Diluted | $ | 3.69 | $ | 2.25 | $ | 9.31 | $ | 2.89 | ||||||||||||||||||
| Weighted-average shares and equivalent shares outstanding: | ||||||||||||||||||||||||||
| Basic | 24,622 | 24,357 | 24,582 | 24,354 | ||||||||||||||||||||||
| Diluted | 24,926 | 24,573 | 24,904 | 24,535 | ||||||||||||||||||||||
| Comprehensive income | $ | 87,100 | $ | 72,337 | $ | 227,491 | $ | 70,594 | ||||||||||||||||||
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LITTELFUSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended | ||||||||||||||
| (in thousands) | September 25, 2021 | September 26, 2020 | ||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | 231,862 | $ | 71,009 | ||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | 96,824 | 113,867 | ||||||||||||
| Changes in operating assets and liabilities: | ||||||||||||||
| Trade receivables | (83,793) | (29,362) | ||||||||||||
| Inventories | (71,232) | (1,611) | ||||||||||||
| Accounts payable | 53,945 | 6,661 | ||||||||||||
| Accrued liabilities and income taxes | 23,294 | (2,095) | ||||||||||||
| Prepaid expenses and other assets | (10,236) | 5,787 | ||||||||||||
| Net cash provided by operating activities | 240,664 | 164,256 | ||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Acquisitions of businesses, net of cash acquired | (110,646) | — | ||||||||||||
| Purchases of property, plant, and equipment | (57,526) | (41,536) | ||||||||||||
| Net proceeds from sale of property, plant, and equipment, and other | 2,561 | 148 | ||||||||||||
| Net cash used in investing activities | (165,611) | (41,388) | ||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Net (payments) proceeds from credit facility | (30,000) | 35,000 | ||||||||||||
| Purchases of common stock | — | (22,927) | ||||||||||||
| Cash dividends paid | (36,648) | (35,100) | ||||||||||||
| All other cash provided by financing activities | 5,771 | 4,651 | ||||||||||||
| Net cash used in financing activities | (60,877) | (18,376) | ||||||||||||
| Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (5,832) | 6,259 | ||||||||||||
| Increase in cash, cash equivalents, and restricted cash | 8,344 | 110,751 | ||||||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | 687,525 | 531,139 | ||||||||||||
| Cash, cash equivalents, and restricted cash at end of period | $ | 695,869 | $ | 641,890 | ||||||||||
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LITTELFUSE, INC.
NET SALES AND OPERATING INCOME BY SEGMENT
(Unaudited)
| Third Quarter | Year-to-Date | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2021 | 2020 | % Growth /(Decline) | 2021 | 2020 | % Growth /(Decline) | ||||||||||||||||||||||||||||||||
| Net sales | ||||||||||||||||||||||||||||||||||||||
| Electronics | $ | 347,240 | $ | 255,349 | 36.0 | % | $ | 959,122 | $ | 692,809 | 38.4 | % | ||||||||||||||||||||||||||
| Automotive | 124,415 | 104,724 | 18.8 | % | 386,262 | 271,493 | 42.3 | % | ||||||||||||||||||||||||||||||
| Industrial | 67,926 | 31,493 | 115.7 | % | 181,479 | 80,697 | 124.9 | % | ||||||||||||||||||||||||||||||
| Total net sales | $ | 539,581 | $ | 391,566 | 37.8 | % | $ | 1,526,863 | $ | 1,044,999 | 46.1 | % | ||||||||||||||||||||||||||
| Operating income | ||||||||||||||||||||||||||||||||||||||
| Electronics | $ | 100,524 | $ | 45,860 | 119.2 | % | $ | 230,283 | $ | 110,783 | 107.9 | % | ||||||||||||||||||||||||||
| Automotive | 15,806 | 15,383 | 2.7 | % | 55,380 | 20,642 | 168.3 | % | ||||||||||||||||||||||||||||||
| Industrial | 6,571 | 4,898 | 34.2 | % | 18,452 | 8,409 | 119.4 | % | ||||||||||||||||||||||||||||||
Other(a) | (2,794) | (1,583) | N.M. | (11,270) | (42,476) | N.M. | ||||||||||||||||||||||||||||||||
| Total operating income | $ | 120,107 | $ | 64,558 | 86.0 | % | $ | 292,845 | $ | 97,358 | 200.8 | % | ||||||||||||||||||||||||||
| Operating Margin | 22.3 | % | 16.5 | % | 19.2 | % | 9.3 | % | ||||||||||||||||||||||||||||||
| Interest expense | 4,602 | 4,988 | 13,901 | 16,261 | ||||||||||||||||||||||||||||||||||
| Foreign exchange loss (gain) | 3,154 | (6,174) | 8,315 | (9,600) | ||||||||||||||||||||||||||||||||||
| Other income, net | (1,240) | (1,682) | (10,867) | (1,643) | ||||||||||||||||||||||||||||||||||
| Income before income taxes | $ | 113,591 | $ | 67,426 | 68.5 | % | $ | 281,496 | $ | 92,340 | 204.8 | % | ||||||||||||||||||||||||||
(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
| Third Quarter | Year-to-Date | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2021 | 2020 | % Growth /(Decline) | 2021 | 2020 | % Growth /(Decline) | ||||||||||||||||||||||||||||||||
| Operating Margin | ||||||||||||||||||||||||||||||||||||||
| Electronics | 28.9 | % | 18.0 | % | 10.9 | % | 24.0 | % | 16.0 | % | 8.0 | % | ||||||||||||||||||||||||||
| Automotive | 12.7 | % | 14.7 | % | (2.0) | % | 14.3 | % | 7.6 | % | 6.7 | % | ||||||||||||||||||||||||||
| Industrial | 9.7 | % | 15.6 | % | (5.9) | % | 10.2 | % | 10.4 | % | (0.2) | % | ||||||||||||||||||||||||||
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LITTELFUSE, INC.
SUPPLEMENTAL FINANCIAL INFORMATION
(In millions of USD except per share amounts - unaudited)
| Non-GAAP EPS reconciliation | ||||||||||||||||||||||||||
| Q3-21 | Q3-20 | YTD-21 | YTD-20 | |||||||||||||||||||||||
| GAAP diluted EPS | $ | 3.69 | $ | 2.25 | $ | 9.31 | $ | 2.89 | ||||||||||||||||||
| EPS impact of Non-GAAP adjustments (below) | 0.26 | (0.09) | 0.73 | 1.27 | ||||||||||||||||||||||
| Adjusted diluted EPS | $ | 3.95 | $ | 2.16 | $ | 10.04 | $ | 4.16 | ||||||||||||||||||
| Non-GAAP adjustments - (income) / expense | ||||||||||||||||||||||||||
| Q3-21 | Q3-20 | YTD-21 | YTD-20 | |||||||||||||||||||||||
| Acquisition-related and integration costs (a) | $ | 2.0 | $ | 0.3 | $ | 3.4 | $ | 1.6 | ||||||||||||||||||
| Purchase accounting inventory adjustments (b) | — | — | 6.8 | |||||||||||||||||||||||
| Restructuring, impairment and other charges (c) | 0.8 | 1.3 | 2.0 | 40.9 | ||||||||||||||||||||||
| Gain on sale of fixed assets (d) | — | — | (0.9) | — | ||||||||||||||||||||||
| Non-GAAP adjustments to operating income | 2.8 | 1.6 | 11.3 | 42.5 | ||||||||||||||||||||||
| Other expense, net (e) | 0.1 | 0.1 | 0.6 | 2.1 | ||||||||||||||||||||||
| Non-operating foreign exchange loss (gain) | 3.2 | (6.2) | 8.3 | (9.6) | ||||||||||||||||||||||
| Non-GAAP adjustments to income before income taxes | 6.1 | (4.5) | 20.2 | 35.0 | ||||||||||||||||||||||
| Income taxes (f) | (0.4) | (2.2) | 2.1 | 3.9 | ||||||||||||||||||||||
| Non-GAAP adjustments to net income | $ | 6.5 | $ | (2.3) | $ | 18.1 | $ | 31.1 | ||||||||||||||||||
| Total EPS impact | $ | 0.26 | $ | (0.09) | $ | 0.73 | $ | 1.27 | ||||||||||||||||||
| Adjusted operating margin / Adjusted EBITDA reconciliation | ||||||||||||||||||||||||||
| Q3-21 | Q3-20 | YTD-21 | YTD-20 | |||||||||||||||||||||||
| Net sales | $ | 539.6 | $ | 391.6 | $ | 1,526.9 | $ | 1,045.0 | ||||||||||||||||||
| GAAP operating income | 120.1 | $ | 64.6 | 292.8 | $ | 97.4 | ||||||||||||||||||||
| Add back non-GAAP adjustments | 2.8 | 1.6 | 11.3 | 42.5 | ||||||||||||||||||||||
| Adjusted operating income | $ | 122.9 | $ | 66.2 | $ | 304.1 | $ | 139.9 | ||||||||||||||||||
| Adjusted operating margin | 22.8 | % | 16.9 | % | 19.9 | % | 13.4 | % | ||||||||||||||||||
| Add back amortization | 10.4 | 10.1 | 31.6 | 29.9 | ||||||||||||||||||||||
| Add back depreciation | 14.2 | 14.2 | 41.4 | 42.0 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 147.5 | $ | 90.5 | $ | 377.1 | $ | 211.8 | ||||||||||||||||||
| Adjusted EBITDA margin | 27.3 | % | 23.1 | % | 24.7 | % | 20.3 | % | ||||||||||||||||||
| Net sales reconciliation | Q3-21 vs. Q3-20 | |||||||||||||||||||||||||
| Electronics | Automotive | Industrial | Total | |||||||||||||||||||||||
| Net sales growth | 36 | % | 19 | % | 116 | % | 38 | % | ||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Acquisitions | — | — | 93 | % | 8 | % | ||||||||||||||||||||
| Transfer a product line between segments | — | % | — | % | — | % | — | % | ||||||||||||||||||
| FX impact | 1 | % | 2 | % | 1 | % | 1 | % | ||||||||||||||||||
| Organic net sales growth | 35 | % | 17 | % | 22 | % | 29 | % | ||||||||||||||||||
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| Net sales reconciliation | YTD-21 vs. YTD-20 | |||||||||||||||||||||||||
| Electronics | Automotive | Industrial | Total | |||||||||||||||||||||||
| Net sales growth | 38 | % | 42 | % | 125 | % | 46 | % | ||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Acquisitions | — | — | 90 | % | 7 | % | ||||||||||||||||||||
| Transfer a product line between segments | (1) | % | — | % | 6 | % | — | % | ||||||||||||||||||
| FX impact | 2 | % | 5 | % | 1 | % | 3 | % | ||||||||||||||||||
| Organic net sales growth | 37 | % | 37 | % | 28 | % | 36 | % | ||||||||||||||||||
| Income tax reconciliation | ||||||||||||||||||||||||||
| Q3-21 | Q3-20 | YTD-21 | YTD-20 | |||||||||||||||||||||||
| Income taxes | $ | 21.5 | $ | 12.1 | $ | 49.6 | $ | 21.3 | ||||||||||||||||||
| Effective rate | 19.0 | % | 17.9 | % | 17.6 | % | 23.1 | % | ||||||||||||||||||
| Non-GAAP adjustments - income taxes | (0.4) | (2.2) | 2.1 | 3.9 | ||||||||||||||||||||||
| Adjusted income taxes | $ | 21.1 | $ | 9.9 | $ | 51.7 | $ | 25.2 | ||||||||||||||||||
| Adjusted effective rate | 17.6 | % | 15.7 | % | 17.1 | % | 19.8 | % | ||||||||||||||||||
| Free cash flow reconciliation | ||||||||||||||||||||||||||
| Q3-21 | Q3-20 | YTD-21 | YTD-20 | |||||||||||||||||||||||
| Net cash provided by operating activities | $ | 114.3 | $ | 63.0 | $ | 240.7 | $ | 164.3 | ||||||||||||||||||
| Less: Purchases of property, plant and equipment | (24.9) | (12.1) | (57.5) | (41.6) | ||||||||||||||||||||||
| Free cash flow | $ | 89.4 | $ | 50.9 | $ | 183.2 | $ | 122.7 | ||||||||||||||||||
| Consolidated Total Debt | As of September 25, 2021 | |||||||
| Consolidated total gross debt | $ | 651.1 | ||||||
| Unamortized debt issuance costs | (3.4) | |||||||
| Consolidated Total Debt | $ | 647.7 | ||||||
| Consolidated EBITDA (as defined in the Private Placement Senior Notes) (1) | Twelve Months Ended September 25, 2021 | |||||||
| Net Income | $ | 290.9 | ||||||
| Interest expense | 18.7 | |||||||
| Income taxes | 59.6 | |||||||
| Depreciation | 55.6 | |||||||
| Amortization | 41.7 | |||||||
| Non-cash additions (reductions): | ||||||||
| Stock-based compensation expense | 19.6 | |||||||
| Purchase accounting inventory step-up charge | 6.8 | |||||||
| Unrealized gain on investments | (13.2) | |||||||
| Impairment charges | — | |||||||
| Other | 3.4 | |||||||
| Consolidated EBITDA (as defined in the Private Placement Senior Notes) (1) | $ | 483.1 | ||||||
| Ratio of Consolidated total gross debt to Consolidated EBITDA (as defined in Private Placement Senior Notes)* | 1.3x | |||||||
* Our Private Placement Senior Notes, with maturities ranging from 2022 to 2030, contain a financial ratio covenant providing that if, as of the last day of each fiscal quarter, the ratio of Consolidated total gross debt at such time to Consolidated EBITDA 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 Private Placement Senior Notes) is triggered.
Page 10
(1) Represents Consolidated EBITDA as defined in our 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 cost of sales.
(c) For the fiscal year ended December 26, 2020, the Company presented restructuring, impairment and other charges as a separate caption in the Consolidated Statements of Net Income. Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current period financial statements.
(d) reflected in SG&A, a year-to-date gain of $0.9 million from the sale of a building within the Electronics segment during 2021.
(e) Q3 2021 included a $0.1 million charge for an asset retirement obligation related to the disposal of a business in 2019. 2021 year-to-date amount included $0.5 million of impairment charges on certain other investments. Q3 2020 amount included $0.1 million of impairment charges on certain other investments. 2020 year-to date amount included $1.8 million increase in coal mining reserves and $0.2 million charge for an asset retirement obligation related to the disposal of a business in 2019.
(f) reflected the tax impact associated with the non-GAAP adjustments.
###
1 Q3 2021 EARNINGS RELEASE October 26, 2021
2Littelfuse, Inc. © 2021 DISCLAIMERS Important Information About Interfuse, 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 Interfuse, Inc. and no investment decision should be made based upon the information provided herein. Interfuse strongly urges you to review its filings with the Securities and Exchange Commission, which can be found at investor.littelfuse.com/sec.cfm. This website also provides additional information about Interfuse. “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. These statements may involve risks and uncertainties, including, but not limited to, risks and uncertainties relating to general economic conditions; the severity and duration of the COVID- 19 pandemic and the measures taken in response thereto and the effects of those items on the company’s business; 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 Interfuse, Inc.'s ("Interfuse" or the "Company") 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 26, 2020. 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 26, 2020, 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 presentation includes the non-GAAP financial measures of organic net sales growth, adjusted operating margin, adjusted diluted earnings per share, adjusted effective tax rate, and free cash flow. 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 and ability to generate cash enhancing an investor’s overall understanding of its core financial performance. The company believes that these non-GAAP financial measures are commonly used by financial analysts and provide useful information to analysts. Management uses these measures when assessing the performance of the business and for business planning purposes. Note that the definitions of these non- GAAP financial measures may differ from those terms as defined or used by other companies.
BUSINESS UPDATE Dave Heinzmann, President & CEO
4Littelfuse, Inc. © 2021 Q3-21 KEY THEMES Record revenue & earnings for the quarter Outstanding performance within challenging supply chain environment Ongoing, effective operational execution Continuous improvements to support customers Reflects global teams' commitment & hard work Broad-based strength across electronics segment end- markets, tempered by supply constraints in passenger car markets
5Littelfuse, Inc. © 2021 ANNOUNCEMENT TO ACQUIRE CARLING TECHNOLOGIES Switches Power Distribution Units Circuit Breakers Consistent with strategic M&A priorities
6Littelfuse, Inc. © 2021 INDUSTRIAL END MARKETS POSITIONED FOR CONTINUED GROWTH Alternative energy, smart industry & safety continues to expand opportunities Strength across core markets Leveraging Hartland Controls product portfolio to capture design wins New business across Asia, Europe & North America Q3-21 Highlights Q3-21 Key Design Wins HVAC (Industrial Refrigeration) Renewable Energy & Energy Storage Industrial Safety
7Littelfuse, Inc. © 2021 TRANSPORTATION END MARKETS EXTENDING OUR LEADERSHIP POSITION Q3-21 Key Design WinsQ3-21 Highlights Sustainability & safety increasing product content opportunities Electric vehicle ramp driving robust design activity & several strategic gains Content outgrowth with wide range of passenger car wins Captured commercial vehicle business across China, Europe & North America xEV & EV Charging Applications EV Bus High-Current modules for passenger vehicles Automotive Electronics
8Littelfuse, Inc. © 2021 ELECTRONICS END MARKETS LEVERAGING OUR LEADERSHIP Q3-21 Highlights Q3-21 Key Design Wins Ongoing trend towards a more connected & electrified world expands new business pipeline Rapid technical support driving design wins Speed of service is differentiator, especially in current landscape Increasing presence across a wide spectrum of applications... from renewables to factory & building automation to manufacturing tools Data Center Appliances & Building Solutions Lawn & Garden Tools Manufacturing Tools
FINANCIAL UPDATE Meenal Sethna, EVP & CFO
10Littelfuse, Inc. © 2021 See appendix for GAAP to non-GAAP reconciliation Highlights Revenue +38% vs. prior year, +3% sequentially +29% organic vs. prior year GAAP operating margin 22.3%; adjusted operating margin 22.8%, +330 bps sequential Strength in sales / margins led by Electronics segment Adjusted EPS +83% vs prior year, +16% sequentially Effective tax rate: GAAP 19.0%; adjusted 17.6% Free cash flow $89m; $183m YTD 79% conversion YTD GAAP EPS $2.25 $3.30 $3.69 Adj. EPS $2.16 $3.41 $3.95 $392 $523 $540 Q3-20 Q2-21 Q3-21 (in millions) Q3-21 FINANCIAL PERFORMANCE Revenue & EPS
11Littelfuse, Inc. © 2021 $31 $65 $68 Q3-20 Q2-21 Q3-21 Revenue $105 $133 $124 Q3-20 Q2-21 Q3-21 Revenue Q3-21 SEGMENT PERFORMANCE Electronics Segment Automotive Segment Industrial Segment Revenue +36%, +7% sequential Sales stronger than expected, working through backlog and content growth (in millions) Op Margin 18.0% 22.8% 28.9% $255 $325 $347 Q3-20 Q2-21 Q3-21 Revenue Revenue +19%, (-7%) sequential; Versus prior year: comm. vehicle +38%, pass. vehicle +13% Chip shortages impacting passenger car build / customer production Segment affected most by higher commodity prices Revenue +116%, +5% sequential Continued strength across HVAC, renewables, energy storage Segment margins impacted by supply disruptions and lower Hartland (acquisition) margins Op Margin 14.7% 14.4% 12.7% Op Margin 15.6% 12.9% 9.7% Record operating margins from favorable geographic/product mix, record volumes & price realization See appendix for GAAP to non-GAAP reconciliation
12Littelfuse, Inc. © 2021 Q4-21 GUIDANCE Highlights Key assumptions Incorporates currently known manufacturing/supply chain impacts No new material COVID disruptions Revenue +27% vs. prior year, (-5)% sequentially at midpoint Closer to typical seasonality Adjusted EPS +29% vs. prior year, (-27)% sequentially at midpoint Reduced volumes and more typical product/ geographical mix across Electronics segment Q4 guidance includes ‘14th week’ During holidays; lower than typical sales and profitability Excludes any impact from Carling Technologies; expect immaterial impact in Q4 results $401 $540 $503 - $517 Q4-20 Q3-21 Q4-21 Revenue & EPS (in millions) See appendix for GAAP to non-GAAP reconciliation GAAP EPS $2.39 $3.69 * Adj. EPS $2.23 $3.95 $2.80 - $2.96 *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.
13Littelfuse, Inc. © 2021 Highlights commitment to environmental, social, and governance (ESG) initiatives Focused on creating a solid foundation for sustainability program to ensure future success Communicates progress towards goals on sustainability journey To learn more, read the 2020 Sustainability Report and visit new Sustainability pages on corporate website 2020 SUSTAINABILITY REPORT
14Littelfuse, Inc. © 2021 Year-to-date, exceptional performance within ongoing challenging environment Continue to closely monitor supply chain challenges across suppliers & customers Proven sound business fundamentals Poised to achieve significant sales and earnings growth this year Remain well-positioned to deliver ongoing superior value for all stakeholders KEY TAKEAWAYS
15Littelfuse, Inc. © 2021 Q&A
16Littelfuse, Inc. © 2021 APPENDIX
17Littelfuse, Inc. © 2021 SUPPLEMENTAL FINANCIAL INFORMATION
18Littelfuse, Inc. © 2021 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D
19Littelfuse, Inc. © 2021 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D
20Littelfuse, Inc. © 2021 SUPPLEMENTAL FINANCIAL INFORMATION CONT’D