Amphenol Corporation (NYSE-APH) reported today fourth quarter 2011 diluted earnings per share of $.69 compared to $.74 per share for the comparable 2010 period. Such per share amount for the 2011 period included one-time charges of $9 million ($5 million after tax), or a $.03 per share charge relating to the previously announced flood damage at the Company’s Sidney, New York facility described further below (“Flood Loss”), and a $2 million ($2 million after tax), or $.01 per share charge for acquisition related transaction costs associated with the November acquisition described below (“Acquisition Costs”). Excluding these charges, diluted earnings per share was $.73 for the fourth quarter of 2011. Sales for the fourth quarter 2011 were $949 million compared to $950 million for the 2010 period. Currency translation had the effect of increasing sales by approximately $2 million in the fourth quarter 2011 compared to the 2010 period.
For the year ended December 31, 2011, diluted earnings per share was $3.05 compared to $2.82 for 2010. 2011 diluted earnings per share excluding the following one-time items was also $3.05 per share:
(1) a $21 million ($13 million after tax), or $.08 per share charge relating to the Flood Loss,
(2) a $2 million ($2 million after tax) or $.01 per share charge for Acquisition Costs,
(3) a $.03 per share ($4 million) benefit relating to a reduction in international tax expense due to reserve adjustments and refunds from the favorable settlement of certain tax positions and
(4) a gain of $18 million ($11 million after tax), or $.06 per share, related to the adjustment of a contingent purchase obligation for a 2010 acquisition. 2010 diluted earnings per share included a net benefit of approximately $.12 per share ($21 million), relating primarily to a reduction in international tax expense due to reserve adjustments and refunds from the favorable settlement of certain tax positions. Excluding the effects of these items, diluted earnings per share was $3.05 and $2.70 for the years ended December 31, 2011 and 2010, respectively. Sales for the year ended December 31, 2011 were $3,940 million compared to $3,554 million for 2010. Currency translation had the effect of increasing sales by approximately $60 million for the full year 2011 period when compared to 2010.
As previously announced, the Company incurred damage at its Sidney, New York manufacturing facility as a result of severe and sudden flooding in New York State during the period September 7 through September 9, 2011. In the third quarter the Company recorded a charge of $13 million or $.05 per share for property-related damage, as well as cleanup and repair efforts, net of expected insurance recoveries. This charge included the Company’s best estimate of the loss related to inventory and machinery and equipment. In the fourth quarter, the Company recorded an additional charge of approximately $9 million or $.03 per share for one-time charges related to remaining cleanup and repair efforts. The Sidney facility had limited manufacturing and sales activity in September and was ramping up to full production levels during October. This limited activity reduced sales by approximately $11 million in the third quarter and approximately $7 million in the fourth quarter.
Amphenol President and Chief Executive Officer R. Adam Norwitt stated “We are pleased to report strong performance in a very challenging environment in the quarter with fourth quarter sales of $949 million, operating income margin (excluding one-time items) of 18.5% and earnings per share (excluding one-time items) of $.73. Global markets have been impacted by a higher level of uncertainty related in part to the fiscal and budgetary issues in many developed economies. As a result, as expected, many of our customers exercised increased levels of caution in the quarter, translating into lower demand in most markets. Accordingly, sales were down approximately 8% sequentially from the record third quarter of 2011 reflecting this slowdown in demand, particularly in communications related markets. Sales were approximately equal to prior year levels with strength in mobile devices, automotive, commercial aerospace and industrial markets, offsetting declines in the defense market and in the communication equipment markets including wireless infrastructure, IT and data com and broadband. While our fourth quarter results have certainly been impacted by these lower demand levels, our performance continues to show the significant benefits of the Company’s diversity. In addition, it is extremely rewarding that the Company’s unique entrepreneurial culture continues to drive an unwavering focus on profitability and cash flow which have remained strong even in this difficult environment. I am very proud of our organization as we continue to execute well in a very challenging environment.”
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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