Littelfuse Reports First Quarter Results

2009-04-30 06:45:00

CHICAGO, April 30, 2009 - Littelfuse, Inc. (NASDAQ:LFUS) today reported sales and earnings for the first quarter of 2009.

First Quarter Highlights

• Sales for the first quarter of 2009 were $84.4 million, a 37% decline compared to the first quarter of 2008. The slow start to the current year was due to the following:
• Exceptionally weak end markets across all geographies for automotive, consumer electronics and telecom, as a result of the global economic downturn and credit crisis.
• Extended factory shutdowns for automotive OEMs and electronic contract manufacturers in an attempt to bring inventories in line.
• Inventory reductions at electronics distributors in all geographies.
• Weakness in the electrical fuse business, reflecting the downturn in non-residential construction and inventory reductions in the distribution channel.
• On a GAAP basis, the company had a loss of ($0.36) per diluted share in the first quarter of 2009, which was consistent with the company’s guidance. This compared to earnings of $0.19 per diluted share for the first quarter of 2008. The sharp earnings decline compared to the prior year was primarily the result of lower sales and, to a lesser extent, an unfavorable tax rate due to non-recurring tax effects in Asia. These negative impacts were partially offset by reductions in both manufacturing and operating expenses.
• Cash used in operating activities was ($1.9) million for the first quarter of 2009 compared to ($1.0) million for the first quarter of 2008, as unfavorable net income was mostly offset by favorable working capital performance. Capital expenditures for the first quarter of 2009 were $7.2 million compared to $11.5 million for the prior-year quarter.
• The company ended the first quarter of 2009 with $60.2 million in cash and had $75.0 million of borrowing capacity under its revolving credit facility. At March 28, 2009, the company was in compliance with all debt covenants and expects to remain in compliance for the foreseeable future.
• The book-to-bill ratio for electronics for the first quarter of 2009 was 1.0 and has improved throughout the month of April.

“The first quarter started even slower than expected, and we did not see much improvement in order rates until well into March,” said Gordon Hunter, Chief Executive Officer. “The initial signs of improvement came from our electronics business in Taiwan and China, and more recently we have seen increased orders from North American distributors. The automotive business in Europe and Asia has come off the lows of January and February, but the U.S. business continues to be very weak.”

“The extreme weakness of the first quarter and the increasing likelihood of an extended downturn caused us to take further actions to improve cash flow and reduce our breakeven point,” said Phil Franklin, Chief Financial Officer. “Operating expenses, which we previously indicated would be $15 million lower than 2008 levels, are now expected to be more than $20 million below 2008 levels. We also will be making further cuts in manufacturing costs and capital expenditures.”

Outlook

• Sales for the second quarter of 2009 are expected to be in the range of $93 to $97 million, which represents 10 - 15% sequential growth over the first quarter.
• The company believes that at the upper end of its sales guidance, it can return to profitability in the second quarter, excluding any one-time charges. The company is evaluating additional cost savings opportunities and as a result, may incur additional restructuring charges in the second quarter.
• Capital spending for 2009 is now expected to be approximately $23 million.

“In this challenging environment, we continue to execute well on all of our cost reduction projects and to further reduce our breakeven point. Despite the ongoing uncertainty of the global economy, we expect recurring earnings for the second quarter of 2009 to be substantially better than the first quarter and to continue to improve in the second half of the year,” said Hunter.

Conference Call Webcast Information
Littelfuse will host a conference call today, Thursday, April 30, 2009 at 11:00 a.m. Eastern/10:00 a.m. Central time to discuss the first quarter results. The call will be broadcast live over the Internet and can be accessed through the company’s Web site: www.littelfuse.com. Listeners should go to the Web site at least 15 minutes prior to the call to download and install any necessary audio software. The call will be available for replay through June 30, 2009 and can be accessed through the Web site listed above.

About Littelfuse
As the worldwide leader in circuit protection products and solutions with annual sales of $530.9 million in 2008, the Littelfuse portfolio is backed by industry-leading technical support, design and manufacturing expertise. Littelfuse products are vital components in virtually every product that uses electrical energy, including automobiles, computers, consumer electronics, handheld devices, industrial equipment and telecom/datacom circuits. Littelfuse offers Teccor®, Wickmann® and Pudenz® brand circuit protection products. In addition to its Chicago, Illinois, world headquarters, Littelfuse has sales, distribution, manufacturing and engineering facilities in Brazil, Canada, China, England, Germany, Hong Kong, India, Japan, Korea, Mexico, the Netherlands, the Philippines, Singapore, Taiwan and the U.S.

For more information, please visit Littelfuse’s web site at www.littelfuse.com.


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