Belden Reports Fourth Quarter and Full Year 2024 Results

ST. LOUIS--(BUSINESS WIRE)--Belden Inc. (NYSE: BDC) (“Belden” or the “Company”), a leading global supplier of complete connection solutions, today reported fiscal fourth quarter and full year results for the period ended December 31, 2024. Fourth Quarter 2024 Highlights Revenues of $666 million, up 21% y/y and up 14% y/y organically GAAP EPS of $1.42, up 56% y/y Adjusted EPS of $1.92, up 32% y/y Repurchased 0.5 million shares for $55 million during the quarter Full Year 2024 Highlights Revenues of $2,461 million, down 2% y/y and down 6% y/y organically GAAP EPS of $4.80, down 15% y/y Adjusted EPS of $6.36, down 7% y/y Free Cash Flow of $223 million, up 3% y/y Repurchased 1.3 million shares for $133 million during the year “I am proud of our team for delivering an excellent quarter and ending the year on a high note,” said Ashish Chand, President and CEO of Belden. “Demand continues to remain steady, with sequential orders up modestly for the quarter and increasing 9% for the year. Performance during the quarter was strong, marked by 21% year-over-year revenue growth with expanding margins. As business conditions continue to improve, I am pleased to report that our revenues grew organically in the fourth quarter by 14% with strength in both segments. Free cash flow for the year reached $223 million, providing the business with ample capital to allocate towards compelling acquisition opportunities while also returning capital to shareholders through share repurchases when appropriate.” Fourth Quarter 2024 Revenues for the quarter increased $115 million, or 21%, to $666 million from $551 million in the year-ago period. Revenues increased 14% organically, with Automation Solutions and Smart Infrastructure Solutions both up 14%. Net income was $58 million, compared to $39 million in the year-ago period. Net income as a percentage of revenues was 8.8%, compared to 7.0% in the year-ago period. EPS totaled $1.42 for the quarter, compared to $0.91 in the year-ago period. Adjusted EBITDA was $114 million, up $26 million, or 29%, compared to $88 million in the year-ago period. Adjusted EBITDA margin was 17.1%, up 110 bps, compared to 16.0% in the year-ago period. Adjusted EPS was $1.92, increasing 32% compared to $1.46 in the year-ago period. Relative to our prior guidance, Adjusted EPS benefited in the fourth quarter by $0.17 from a lower-than-expected tax rate. Adjusted results are non-GAAP measures, and a non-GAAP reconciliation table is provided as an appendix to this release. Full Year 2024 Revenues for the year decreased $51 million, or 2%, to $2,461 million from $2,512 million in the prior year. Revenues were down 6% organically, with Automation Solutions down 6% and Smart Infrastructure Solutions down 5%. Net income was $198 million, compared to $243 million in the prior year. Net income as a percentage of revenues was 8.1%, compared to 9.7% in the prior year. EPS totaled $4.80 for the year, compared to $5.66 in the prior year. Adjusted EBITDA was $411 million, down $27 million, or 6%, compared to $438 million in the prior year. Adjusted EBITDA margin was 16.7%, down 70 bps, compared to 17.4% in the prior year. Adjusted EPS was $6.36, decreasing 7% compared to $6.83 in the prior year. Adjusted results are non-GAAP measures, and a non-GAAP reconciliation table is provided as an appendix to this release. Outlook “As we continue to drive our solutions transformation, we anticipate first quarter performance to reflect typical seasonality and stable demand,” said Dr. Chand. “Our customers are managing through short-term uncertainties, and we expect further clarity as the quarter progresses. We are confident in the long-term growth potential of our key markets, our team’s ability to execute effectively, and our capacity to allocate capital strategically to maximize shareholder returns while driving sustained growth and compounding value for the business over time.” For the first quarter, we anticipate order patterns to align with typical seasonality and expect our customers to remain in a neutral posture as they navigate this dynamic environment. Revenues are expected to be in the range of $605 million to $620 million, representing a 13% to 16% increase over the prior-year quarter. GAAP EPS is expected to be in the range of $1.03 to $1.13, representing a 14% to 26% increase over the prior-year quarter. Adjusted EPS is expected to be in the range of $1.43 to $1.53, representing a 15% to 23% increase over the prior-year quarter. First quarter guidance includes a currency exchange headwind of approximately $15 million in revenues and $0.05 of EPS. First Quarter 2025: Guidance Revenues (million) $605 - $620 GAAP EPS $1.03 - $1.13 Adjusted EPS $1.43 - $1.53 Earnings Conference Call Management will host a conference call today at 8:30 am ET to discuss the results. The listen-only audio of the conference call will be broadcast live online at https://investor.belden.com. The dial-in number for participants is 1-866-575-6539 with confirmation code 7220743. A replay of this conference call will remain accessible in the investor relations section of the Company’s website for a limited time. Earnings per Share (EPS) and Organic Growth All references to EPS within this earnings release refer to net income per diluted share attributable to Belden stockholders. Organic growth is calculated as the change in revenues excluding the impacts from currency exchange rates, copper prices, acquisitions, and divestitures. BELDEN INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended Twelve Months Ended December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 (In thousands, except per share data) Revenues $ 666,042 $ 551,243 $ 2,460,979 $ 2,512,084 Cost of sales (416,226 ) (344,878 ) (1,538,757 ) (1,557,118 ) Gross profit 249,816 206,365 922,222 954,966 Selling, general and administrative expenses (137,362 ) (126,414 ) (494,603 ) (492,702 ) Research and development expenses (28,968 ) (25,883 ) (112,365 ) (116,427 ) Amortization of intangibles (14,307 ) (10,113 ) (48,794 ) (40,375 ) Gain on sale of assets — — — 12,056 Operating income 69,179 43,955 266,460 317,518 Interest expense, net (10,849 ) (8,032 ) (38,303 ) (33,625 ) Non-operating pension benefit (cost) (962 ) 401 (215 ) 1,863 Income before taxes 57,368 36,324 227,942 285,756 Income tax benefit (expense) 1,014 2,185 (29,528 ) (43,200 ) Net income 58,382 38,509 198,414 242,556 Less: Net income (loss) attributable to noncontrolling interest (2 ) 42 (19 ) (203 ) Net income attributable to Belden stockholders $ 58,384 $ 38,467 $ 198,433 $ 242,759 Weighted average number of common shares and equivalents: Basic 40,312 41,565 40,694 42,237 Diluted 41,087 42,046 41,299 42,859 Basic income per share attributable to Belden stockholders: $ 1.45 $ 0.93 $ 4.88 $ 5.75 Diluted income per share attributable to Belden stockholders: $ 1.42 $ 0.91 $ 4.80 $ 5.66 Common stock dividends declared per share $ 0.05 $ 0.05 $ 0.20 $ 0.20 BELDEN INC. OPERATING SEGMENT INFORMATION (Unaudited) Smart Infrastructure Solutions Automation Solutions (In thousands, except percentages) For the three months ended December 31, 2024 Segment Revenues $ 319,581 $ 346,461 Segment EBITDA 42,401 71,465 Segment EBITDA margin 13.3 % 20.6 % Depreciation expense 6,954 7,732 Amortization of intangibles 9,163 5,144 Amortization of software development intangible assets 12 2,697 Severance, restructuring, and acquisition integration costs 6,647 2,699 Adjustments related to acquisitions and divestitures 3,309 298 For the three months ended December 31, 2023 Segment Revenues $ 251,054 $ 300,189 Segment EBITDA 30,253 57,666 Segment EBITDA margin 12.1 % 19.2 % Depreciation expense 6,164 6,737 Amortization of intangibles 4,914 5,199 Amortization of software development intangible assets — 2,457 Severance, restructuring, and acquisition integration costs 6,074 7,232 Adjustments related to acquisitions and divestitures 4,837 298 For the twelve months ended December 31, 2024 Segment Revenues $ 1,143,790 $ 1,317,189 Segment EBITDA 140,092 269,766 Segment EBITDA margin 12.2 % 20.5 % Depreciation expense 26,231 30,152 Amortization of intangibles 28,642 20,152 Amortization of software development intangible assets 12 10,552 Severance, restructuring, and acquisition integration costs 15,165 7,649 Adjustments related to acquisitions and divestitures 3,572 1,192 For the twelve months ended December 31, 2023 Segment Revenues $ 1,122,831 $ 1,389,253 Segment EBITDA 149,107 287,328 Segment EBITDA margin 13.3 % 20.7 % Depreciation expense 24,943 26,436 Amortization of intangibles 20,085 20,290 Amortization of software development intangible assets — 7,692 Severance, restructuring, and acquisition integration costs 11,221 13,931 Adjustments related to acquisitions and divestitures 5,359 818 BELDEN INC. CONDENSED CONSOLIDATED BALANCE SHEETS December 31, 2024 December 31, 2023 (Unaudited) (In thousands) ASSETS Current assets: Cash and cash equivalents $ 370,302 $ 597,044 Receivables, net 409,711 413,806 Inventories, net 343,099 366,987 Other current assets 73,117 79,142 Total current assets 1,196,229 1,456,979 Property, plant and equipment, less accumulated depreciation 495,625 451,069 Operating lease right-of-use assets 118,551 89,686 Goodwill 1,018,677 907,331 Intangible assets, less accumulated amortization 419,074 269,144 Deferred income taxes 16,353 15,739 Other long-lived assets 63,429 50,243 $ 3,327,938 $ 3,240,191 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 315,724 $ 343,215 Accrued liabilities 306,980 290,289 Total current liabilities 622,704 633,504 Long-term debt 1,130,101 1,204,211 Postretirement benefits 63,260 74,573 Deferred income taxes 77,333 49,472 Long-term operating lease liabilities 100,049 74,941 Other long-term liabilities 39,755 37,188 Stockholders’ equity: Common stock 503 503 Additional paid-in capital 839,755 818,663 Retained earnings 1,176,036 985,807 Accumulated other comprehensive loss (3,532 ) (41,279 ) Treasury stock (718,026 ) (597,437 ) Total Belden stockholders’ equity 1,294,736 1,166,257 Noncontrolling interests — 45 Total stockholders’ equity 1,294,736 1,166,302 $ 3,327,938 $ 3,240,191 BELDEN INC. CONDENSED CONSOLIDATED CASH FLOW STATEMENTS (Unaudited) Twelve Months Ended December 31, 2024 December 31, 2023 (In thousands) Cash flows from operating activities: Net income $ 198,414 $ 242,556 Adjustments to reconcile net income to net cash from operating activities: Depreciation and amortization 115,741 99,446 Share-based compensation 27,532 21,024 Deferred income tax benefit (15,954 ) (12,957 ) Gain on sale of assets — (12,056 ) Changes in operating assets and liabilities, net of the effects of currency exchange rate changes, acquired businesses and disposals: Receivables 18,861 24,527 Inventories 24,318 (15,331 ) Accounts payable (29,001 ) (8,175 ) Accrued liabilities 11,354 (16,292 ) Income taxes 6,639 (3,668 ) Other assets (6,689 ) (9,314 ) Other liabilities (6,416 ) 9,878 Net cash provided by operating activities 344,799 319,638 Cash flows from investing activities: Cash used for business acquisitions, net of cash acquired (296,452 ) (106,712 ) Capital expenditures (121,823 ) (116,731 ) Cash from (used for) disposal of businesses, net of cash sold (1,316 ) 9,300 Proceeds from disposal of tangible assets 113 13,785 Net cash used for investing activities (419,478 ) (200,358 ) Cash flows from financing activities: Payments under share repurchase program including excise tax (134,308 ) (192,135 ) Withholding tax payments for share-based payment awards (9,659 ) (17,444 ) Cash dividends paid (8,195 ) (8,498 ) Payments under financing lease obligations (1,134 ) (423 ) Payments to noncontrolling interest holders (67 ) — Other 728 — Proceeds from issuance of common stock 8,917 6,568 Net cash used for financing activities (143,718 ) (211,932 ) Effect of foreign currency exchange rate changes on cash and cash equivalents (8,345 ) 2,020 Net decrease in cash and cash equivalents (226,742 ) (90,632 ) Cash and cash equivalents, beginning of period 597,044 687,676 Cash and cash equivalents, end of period $ 370,302 $ 597,044 BELDEN INC. RECONCILIATION OF NON-GAAP MEASURES (Unaudited) In addition to reporting financial results in accordance with accounting principles generally accepted in the United States, we provide non-GAAP operating results adjusted for certain items, including: asset impairments; accelerated depreciation expense due to plant consolidation activities; purchase accounting effects related to acquisitions, such as the adjustment of acquired inventory to fair value, and transaction costs; severance, restructuring, and acquisition integration costs; gains (losses) recognized on the disposal of businesses and assets; amortization of intangible assets; gains (losses) on debt extinguishment; certain gains (losses) from patent settlements; discontinued operations; and other costs. We adjust for the items listed above in all periods presented, unless the impact is clearly immaterial to our financial statements. When we calculate the tax effect of the adjustments, we include all current and deferred income tax expense commensurate with the adjusted measure of pre-tax profitability. We utilize the adjusted results to review our ongoing operations without the effect of these adjustments and for comparison to budgeted operating results. We believe the adjusted results are useful to investors because they help them compare our results to previous periods and provide important insights into underlying trends in the business and how management oversees our business operations on a day-to-day basis. As an example, we adjust for acquisition-related expenses, such as amortization of intangibles and impacts of fair value adjustments because they generally are not related to the acquired business' core business performance. As an additional example, we exclude the costs of restructuring programs, which can occur from time to time for our current businesses and/or recently acquired businesses. We exclude the costs in calculating adjusted results to allow us and investors to evaluate the performance of the business based upon its expected ongoing operating structure. We believe the adjusted measures, accompanied by the disclosure of the costs of these programs, provides valuable insight. Adjusted results should be considered only in conjunction with results reported according to accounting principles generally accepted in the United States. Three Months Ended Twelve Months Ended December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 (In thousands, except percentages and per share amounts) Revenues $ 666,042 $ 551,243 $ 2,460,979 $ 2,512,084 GAAP gross profit $ 249,816 $ 206,365 $ 922,222 $ 954,966 Amortization of software development intangible assets 2,709 2,457 10,564 7,692 Severance, restructuring, and acquisition integration costs 1,196 2,088 4,395 3,488 Adjustments related to acquisitions and divestitures — (270 ) 263 252 Adjusted gross profit $ 253,721 $ 210,640 $ 937,444 $ 966,398 GAAP gross profit margin 37.5 % 37.4 % 37.5 % 38.0 % Adjusted gross profit margin 38.1 % 38.2 % 38.1 % 38.5 % GAAP selling, general and administrative expenses $ (137,362 ) $ (126,414 ) (494,603 ) (492,702 ) Severance, restructuring, and acquisition integration costs 8,270 9,637 18,257 20,039 Adjustments related to acquisitions and divestitures 3,607 5,405 4,501 5,925 Adjusted selling, general and administrative expenses $ (125,485 ) $ (111,372 ) $ (471,845 ) $ (466,738 ) GAAP research and development expenses $ (28,968 ) $ (25,883 ) $ (112,365 ) $ (116,427 ) Severance, restructuring, and acquisition integration costs (120 ) 1,581 162 1,625 Adjusted research and development expenses $ (29,088 ) $ (24,302 ) $ (112,203 ) $ (114,802 ) GAAP net income $ 58,382 $ 38,509 $ 198,414 $ 242,556 Income tax expense (benefit) (1,014 ) (2,185 ) 29,528 43,200 Interest expense, net 10,849 8,032 38,303 33,625 Non-operating pension settlement loss 1,208 — 1,208 — Total non-operating adjustments 11,043 5,847 69,039 76,825 Amortization of intangible assets 14,307 10,113 48,794 40,375 Severance, restructuring, and acquisition integration costs 9,346 13,306 22,814 25,152 Amortization of software development intangible assets 2,709 2,457 10,564 7,692 Adjustments related to acquisitions and divestitures 3,607 5,135 4,764 6,177 Gain on sale of assets — — — (12,056 ) Total operating income adjustments 29,969 31,011 86,936 67,340 Depreciation expense 14,686 12,901 56,383 51,379 Adjusted EBITDA $ 114,080 $ 88,268 $ 410,772 $ 438,100 GAAP income margin 8.8 % 7.0 % 8.1 % 9.7 % Adjusted EBITDA margin 17.1 % 16.0 % 16.7 % 17.4 % GAAP net income $ 58,382 $ 38,509 $ 198,414 $ 242,556 Less: Net income (loss) attributable to noncontrolling interest (2 ) 42 (19 ) (203 ) GAAP net income attributable to Belden stockholders $ 58,384 $ 38,467 $ 198,433 $ 242,759 GAAP net income $ 58,382 $ 38,509 $ 198,414 $ 242,556 Plus: Operating income adjustments from above 29,969 31,011 86,936 67,340 Plus: Non-operating pension settlement loss 1,208 — 1,208 — Less: Net income (loss) attributable to noncontrolling interest (2 ) 42 (19 ) (203 ) Less: Tax effect of adjustments above 10,859 8,108 23,834 17,310 Adjusted net income attributable to Belden stockholders $ 78,702 $ 61,370 $ 262,743 $ 292,789 GAAP net income per diluted share attributable to Belden stockholders (EPS) $ 1.42 $ 0.91 $ 4.80 $ 5.66 Adjusted net income per diluted share attributable to Belden stockholders (Adjusted EPS) $ 1.92 $ 1.46 $ 6.36 $ 6.83 GAAP and adjusted diluted weighted average shares 41,087 42,046 41,299 42,859 BELDEN INC. RECONCILIATION OF NON-GAAP MEASURES (Unaudited) We define free cash flow, which is a non-GAAP financial measure, as net cash from operating activities adjusted for capital expenditures net of the proceeds from the disposal of tangible assets. We believe free cash flow provides useful information to investors regarding our ability to generate cash from business operations that is available for acquisitions and other investments, service of debt principal, dividends and share repurchases. We use free cash flow, as defined, as one financial measure to monitor and evaluate performance and liquidity. Non-GAAP financial measures should be considered only in conjunction with financial measures reported according to accounting principles generally accepted in the United States. Our definition of free cash flow may differ from definitions used by other companies. Three Months Ended Twelve Months Ended December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 (In thousands) GAAP net cash provided by operating activities $ 167,442 $ 159,645 $ 344,799 $ 319,638 Capital expenditures (51,064 ) (54,861 ) (121,823 ) (116,731 ) Proceeds from disposal of assets 7 — 113 13,785 Non-GAAP free cash flow $ 116,385 $ 104,784 $ 223,089 $ 216,692 BELDEN INC. RECONCILIATION OF NON-GAAP MEASURES 2025 Guidance Three Months Ended March 30, 2025 GAAP income from continuing operations per diluted share attributable to Belden common stockholders $1.03 - $1.13 Amortization of intangible assets 0.30 Severance, restructuring, and acquisition integration costs 0.09 Adjustments related to acquisitions and divestitures 0.01 Adjusted income from continuing operations per diluted share attributable to Belden common stockholders $1.43 - $1.53 Our guidance is based upon information currently available regarding events and conditions that will impact our future operating results. In particular, our results are subject to the factors listed under "Forward-Looking Statements" in this release. In addition, our actual results are likely to be impacted by other additional events for which information is not available, such as asset impairments, adjustments related to acquisitions and divestitures, severance, restructuring, and acquisition integration costs, gains (losses) recognized on the disposal of assets, gains (losses) on debt extinguishment, discontinued operations, and other gains (losses) related to events or conditions that are not yet known. Forward-Looking Statements This release contains, and any statements made by us concerning the subject matter of this release may contain, forward-looking statements, including our outlook for the first quarter of 2025 and beyond. Forward-looking statements also include any statements regarding future financial performance (including revenues, growth, expenses, earnings, margins, cash flows, dividends, capital expenditures and financial condition), plans and objectives, and related assumptions. In some cases these statements are identifiable through the use of words such as “anticipate,” “believe,” “estimate,” “forecast,” “guide,” “expect,” “intend,” “plan,” “project,” “target,” “can,” “could,” “may,” “should,” “will,” “would” and similar expressions. Forward-looking statements reflect management’s current beliefs and expectations and are not guarantees of future performance. Actual results may differ materially from those suggested by any forward-looking statements for a number of reasons, including, without limitation: the impact of a challenging global economy, including the impact of inflation, or a downturn in served markets; volatility in credit and foreign exchange markets; the competitiveness of the global markets in which we operate; the inability of the Company to develop and introduce new products; competitive responses to our products; the inability to execute and realize the expected benefits from strategic initiatives (including revenue growth, cost control, and productivity improvement programs); difficulty in forecasting revenues due to the unpredictable timing of orders related to customer projects as well as the impacts of channel inventory; foreign and domestic political, economic and other uncertainties, including changes in currency exchange rates; the impact of disruptions in the global supply chain, including the inability to timely obtain raw materials and components in sufficient quantities on commercially reasonable terms; the inability to achieve our strategic priorities in emerging markets; the impact of changes in global tariffs and trade agreements; the presence of substitute products in the marketplace; disruptions in the Company’s information systems including due to cyber-attacks; inflation and changes in the price and availability of raw materials leading to higher input and labor costs; the possibility of future epidemics or pandemics; changes in tax laws and variability in the Company’s quarterly and annual effective tax rates; the increased prevalence of cloud computing; the inability to successfully complete and integrate acquisitions, in furtherance of the Company’s strategic plan, as well as the inability to accurately forecast the financial impacts of acquisitions; the inability to retain key employees; disruption of, or changes in, the Company’s key distribution channels; the presence of activists proposing certain actions by the Company; perceived or actual product failures; the impact of regulatory requirements and other legal compliance issues; inability to satisfy the increasing expectations with respect to environmental, social and governance matters; assertions that the Company violates the intellectual property of others and the ownership of intellectual property by competitors and others that prevents the use of that intellectual property by the Company; risks related to the use of open source software; the impairment of goodwill and other intangible assets and the resulting impact on financial performance; disruptions and increased costs attendant to collective bargaining groups and other labor matters; and other factors. For a more complete discussion of risk factors, please see our Annual Report on Form 10-K for the period ended December 31, 2023, filed with the SEC on February 13, 2024. Although the content of this release represents our best judgment as of the date of this report based on information currently available and reasonable assumptions, we give no assurances that the expectations will prove to be accurate. Deviations from the expectations may be material. For these reasons, Belden cautions readers to not place undue reliance on these forward-looking statements, which speak only as of the date made. Belden disclaims any duty to update any forward-looking statements as a result of new information, future developments, or otherwise, except as required by law. About Belden Belden Inc. delivers complete connection solutions that unlock untold possibilities for our customers, their customers and the world. We advance ideas and technologies that enable a safer, smarter and more prosperous future. Throughout our 120+ year history we have evolved as a company, but our purpose remains – making connections. By connecting people, information and ideas, we make it possible. We are headquartered in St. Louis and have manufacturing capabilities in North America, Europe, Asia and Africa. For more information, visit us at www.belden.com; follow us on Facebook, LinkedIn and X/Twitter. BDC-Financial

Belden Reports Fourth Quarter and Full Year 2024 Results

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