Acquisition Announcement
ST. LOUIS--(BUSINESS WIRE)-- Belden Inc. (NYSE: BDC), a global leader in high quality, end-to-end signal transmission solutions for mission-critical applications, today announced that it has entered into a definitive agreement to acquire privately held Thinklogical, a leading global provider of large scale video and data distribution systems, from Riverside Partners, a Boston-based private equity firm, for $160 million. The transaction will be financed with cash on hand and is expected to close in the second quarter 2017, subject to regulatory approvals and other closing conditions.
Highlights
- Significantly enhances Belden’s Broadcast Solutions platform by adding a technology leader with one-of-a-kind, mission-critical solutions;
- Allows Belden to enter the market for secure, high-performance Keyboard/Video/Mouse (“KVM”) switching hardware;
- Generated 2016 revenues, net income, and adjusted EBITDA of approximately
$51 million ,$12 million , and$17 million , respectively; - Accretive to GAAP and adjusted earnings per diluted share by approximately
$0.04 and$0.27 , respectively, in the first full year of ownership.
Headquartered in
“We are extremely excited to welcome the talented Thinklogical team to the Belden family,” said
| BELDEN INC. | |||
| RECONCILIATION OF NON-GAAP MEASURES | |||
| 2016 THINKLOGICAL EARNINGS | |||
| 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 and deferred revenue to fair value and transaction costs; severance, restructuring, and acquisition integration costs; gains (losses) recognized on the disposal of businesses and tangible assets; amortization of intangible assets; gains (losses) on debt extinguishment; certain revenues and 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 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 the purchase accounting effect of recording deferred revenue at fair value in order to reflect the revenues that would have otherwise been recorded by acquired businesses had they remained as independent entities. We believe this presentation is useful in evaluating the underlying performance of acquired companies. Similarly, we adjust for other acquisition-related expenses, such as amortization of intangibles and other impacts of fair value adjustments because they generally are not related to the acquired business' core operating 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. |
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| Year Ended | |||
| December 31, 2016 | |||
| (In thousands) | |||
| GAAP net income | $ | 12,189 | |
| Interest expense, net | 2,685 | ||
| Depreciation and amortization | 2,365 | ||
| Adjusted EBITDA | $ | 17,239 | |
| BELDEN INC. | ||||||
| RECONCILIATION OF NON-GAAP MEASURES | ||||||
| THINKLOGICAL EARNINGS GUIDANCE | ||||||
| Twelve Months Ended | ||||||
| From Acquisition Date | ||||||
| Adjusted income per diluted share | $ | 0.27 | ||||
| Amortization of intangible assets | (0.14 | ) | ||||
| Purchase accounting effects related to acquisitions | (0.06 | ) | ||||
| Deferred gross profit adjustment | (0.02 | ) | ||||
| Severance, restructuring, and acquisition integration costs | (0.01 | ) | ||||
| GAAP income per diluted share | $ | 0.04 | ||||
| Our guidance for income per diluted share 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 our Annual Report on Form 10-K. In addition, our actual results are likely to be impacted by other additional events for which information is not available, such as asset impairments, purchase accounting effects related to acquisitions, severance, restructuring, and acquisition integration costs, gains (losses) recognized on the disposal of tangible assets, gains (losses) on debt extinguishment, discontinued operations, and other gains (losses) related to events or conditions that are not yet known. | ||||||
Use of Non-GAAP Financial Information
Adjusted results are non-GAAP measures that reflect certain adjustments the Company makes to provide insight into operating results. GAAP to non-GAAP reconciliations accompany this release and have been published to the investor relations section of the Company’s Web site at http://investor.belden.com.
Forward-Looking Statements
This release and any statements made by us concerning the release may contain forward-looking statements including our expectations for the next twelve months. Forward-looking statements include statements regarding future financial performance (including revenues, 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 or a downturn in served markets; the competitiveness of the global broadcast, enterprise, and industrial markets; the inability to successfully complete and integrate acquisitions in furtherance of the Company’s strategic plan; volatility in credit and foreign exchange markets; variability in the Company’s quarterly and annual effective tax rates; the cost and availability of raw materials including copper, plastic compounds, electronic components, and other materials; disruption of, or changes in, the Company’s key distribution channels; the inability to execute and realize the expected benefits from strategic initiatives (including revenue growth, cost control, and productivity improvement programs); disruptions in the Company’s information systems including due to cyber-attacks; the inability of the Company to develop and introduce new products and competitive responses to our products; the inability to retain senior management and key employees; 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 impact of regulatory requirements and other legal compliance issues; perceived or actual product failures; political and economic uncertainties in the countries where the Company conducts business, including emerging markets; 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 year ended
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