Jan 27 2010
CTS Corporation (NYSE: CTS) today announced fourth quarter 2009 revenues
of $133.9 million, 6% higher than third quarter 2009 revenues of $126.6
million. Fourth quarter 2009 net earnings were $4.1 million, or $0.12
per diluted share, including a discrete tax valuation allowance charge
of $2.5 million (or $0.07 per diluted share). Excluding this charge,
fourth quarter non-GAAP adjusted net earnings were $6.6 million, or
$0.19 per diluted share, compared to third quarter 2009 net earnings of
$4.5 million, or $0.13 per diluted share.
Components and Sensors segment revenues increased 17% from the third
quarter of 2009, driven by a 24% improvement in automotive product
shipments with improved market share, as the global markets began to
recover. Sales of electronic component products increased 5% over the
third quarter of 2009 primarily from higher demand for wireless
infrastructure applications. EMS segment sales decreased 3% from the
third quarter of 2009 primarily due to lower sales in the defense and
aerospace market. Components and Sensors segment sales were 49% of total
CTS sales in the fourth quarter, compared to 44% in the third quarter,
contributing to the sequential earnings improvement.
Although total sales in the fourth quarter 2009 decreased 18% from the
same period last year, sales in automotive sensors and actuators
increased 44%, reflecting the global market recovery for light vehicles.
Adjusted fourth quarter 2009 diluted earnings per share of $0.19
increased 36% over the fourth quarter 2008.
Full-year 2009 revenue was $499.0 million, a 28% decrease from 2008
full-year revenue, reflecting the impact of the global recession. The
Company implemented a number of cost saving actions in late 2008 and
2009 to manage through the negative economic environment, finishing the
year with three consecutive sequential quarter-to-quarter improvements
in both sales and operating earnings. Fourth quarter 2009 cash flow from
operations was $12.5 million driving full-year cash flow from operations
to $46.6 million, which is significantly improved from $34.1 million for
full-year 2008. Full-year capital expenditures were $6.5 million,
compared to $17.6 million in 2008. Total debt, as a percentage of total
capitalization, was 17.0% at year-end 2009, compared to 22.4% at
year-end 2008.
Commenting on fourth quarter 2009 results, Vinod M. Khilnani, CTS
Chairman and Chief Executive Officer, stated, “We are pleased to
continue the momentum established earlier this year through our growth
and cost structure initiatives. The Company continued generating strong
cash flow and improving operating profitability. CTS ended the year
further diversifying its geographic customer base by winning strategic
new business in key Asian markets. CTS achieved a record of winning over
$300 million of new business across all our key product lines and
continued to capture design wins for electronic component products.”
The full-year 2009 net loss of $34.1 million, or $1.01 per share,
included four non-operating discrete items: a non-cash charge for
goodwill impairment of $33.2 million, or $0.98 per diluted share,
restructuring charges of $2.2 million, or $0.05, an international cash
repatriation-related tax charge, primarily non-cash, of $9.1 million, or
$0.27 per diluted share, and a discrete tax valuation charge of $2.5
million, or $0.07 per diluted share. Full-year net earnings in 2008 was
$28.1 million, or $0.81 per diluted share. Included in 2008 results were
two non-operating discrete items: a favorable net tax credit of $0.14
per share and a negative $0.10 per share impact from restructuring and
related costs. Excluding these non-operating items, adjusted earnings
per share in 2009 were $0.36, compared to adjusted earnings per share in
2008 of $0.77.
Based on an easing of the current recession, yet taking a cautious view
of the economic indicators in 2010, management anticipates full-year
2010 sales to increase in the range of 10% to 15% over 2009 and diluted
earnings per share to be in the range of $0.45 to $0.53. This estimate
includes reinstatement of certain temporary salary and benefit
reductions in 2009, and increase in the research and development
activities to support new product introductions, including the launch of
sensor and actuator products for diesel and commercial market
applications. First quarter results are expected to show normal
seasonality with gradual improvements during the year.
Components & Sensors: Components and Sensors fourth quarter
2009 sales increased $9.6 million, or 17%, from the third quarter of
2009 reflecting a 24% increase in global automotive sensor product
demand. Electronic component product demand increased 5% primarily in
sales of infrastructure applications. Segment operating earnings
increased $3.5 million from the third quarter, driven primarily by
higher sales volume and improved margins.
Components and Sensors fourth quarter 2009 sales increased $7.5 million,
or 13%, from the fourth quarter of 2008. Automotive sensor and actuator
product sales improved by $13.6 million, or 44%, partially offset by 23%
lower sales of electronic component products. Segment operating earnings
of $7.6 million were favorable by $5.7 million to the fourth quarter of
2008 due to higher sales volumes and cost control initiatives.
EMS: EMS fourth quarter 2009 sales declined $2.3 million, or 3%,
from third quarter 2009 levels, primarily reflecting lower demand in the
defense and aerospace market. Segment operating earnings of $0.7 million
decreased $1.5 million from the third quarter 2009, primarily due to
unfavorable product mix and lower sales.
EMS fourth quarter 2009 sales decreased $36.4 million, or 35%, from the
fourth quarter of 2008 reflecting lower sales across all markets from
the global recession. Segment operating earnings decreased $3.3 million
from the fourth quarter of 2008 on lower volumes, partially offset by
reduced operating expenses.
SOURCE CTS Corporation