The following excerpt is from the company's .
quarter
Net revenue was
$796.5 million
Net income was
$60.6 million
per diluted share.
Adjusted net income
$113.2 million
Almelo, the Netherlands – April 26, 2016 - Sensata Technologies Holding N.V. (NYSE: ST) (the “Company”) announces results of its operations for the
quarter ended
March 31, 2016
Highlights of the
Months ended
Net revenue for the
, an increase of
$45.9 million
, from
$750.7 million
. Net income for the
per diluted share. This compares to Net incom e for the
$35.4 million
per diluted share. Adjusted net income
which was
of Net revenue, or
per diluted share. This was an increase of
compared to Adjusted net income
$110.9 million
per diluted share. Integration charges related to acquisitions were $3.5 million for the
quarter of 2016.
"Sensata delivered solid financial performance in the first quarter with Adjusted EPS up 8% year over year on a constant currency basis. This was in line with our expectations", said Martha Sullivan, President and Chief Executive Officer. "Sensata remains on track for margin expansion through organic activities and successful acquisition integration. We are also very excited about our strategic partnership with Quanergy in LiDAR sensing, a key enabling technology for autonomous driving."
The Company spent $61.6 million, or 7.7% of Net revenue, on research, development and engineering
d costs in the
to fund growth initiatives. These costs reside in both the Cost of revenue and the Research and development lines of the Condensed Consolidated Statements of Operations.
The Company’s ending cash balance at
$348.0 million
. During the first three months of 2016, the Company generated cash of
$136.2 million
from operations, used cash of
$87.6 million
in investing activities and used cash of
$42.9 million
in financing activities.
The Company recorded a provision for income taxes of
$16.2 million
. Approximately
$10.4 million
of the provision, or
of Adjusted EBIT, related to taxes that are payable in cash and approximately
$5.8 million
related to deferred and other income tax expense.
The Company’s total indebtedness at
$3.6 billion
, a reduction of $40.0 million from December 31, 2015 as a result of debt repayment. The Company’s Net debt
$3.3 billion
, resulting in a Net leverage ratio
of 4.5x as of
Segment Performance
Three months ended
$ in 000s
March 31, 2015
Performance Sensing net revenue
597,175
591,252
Performance Sensing profit from operations
145,787
143,872
% of Performance Sensing net revenue
Sensing Solutions net revenue
199,374
159,433
Sensing Solutions profit from operations
63,248
49,218
% of Sensing Solutions net revenue
Guidance
The Company anticipates Net revenue of $800 to $840 million for the second quarter 2016 as compared to second quarter 2015 Net revenue of $770 million. In addition, the Company expects Adjusted net income
of $117 to $127 million, or $0.68 to $0.74 per diluted share for the second quarter 2016, as compared to $0.73 during the second quarter 2015. This guidance assumes a diluted share count of 171.6 million for the second quarter 2016.
For the full year 2016, the Company anticipates net revenue of $3.140 to $3.280 billion which, at the midpoint, represents growth of 7.9% compared to the full year 2015 net revenue of $2.975 billion. In addition, the Company expects Adjusted net income
of $470 million to $515 million, or $2.74 to $3.00 per diluted share for the full year 2016. At the midpoint, this represents 4.4% growth compared to full year 2015 Adjusted net income
per diluted share of $2.75. This guidance assumes a diluted share count of 171.7 million for the full year 2016.
Company Earnings Conference Call
The Company will conduct a conference call today at 8:00 AM eastern time to discuss the financial results for its
. The toll-free dial-in number is 877-486-0682 and the Conference ID is 90651216. A live webcast and a replay of the conference call will also be available on the investor relations page of the Company’s website at
Net debt represents total indebtedness (including Capital lease and other financing obligations but excluding discounts and deferred financing costs) less Cash and cash equivalents. The Net leverage ratio represents Net debt divided by Adjusted EBITDA for the last twelve months. The Company defines Adjusted EBITDA as Adjusted net income excluding cash interest expense, cash tax expense, depreciation expense (excluding step-up depreciation expense related to acquisitions) and amortization expense (excluding amortization expense on acquisition related intangibles).
See Non-GAAP Measures for discussion of Adjusted net income which includes a reconciliation of this measure to Net income.
About Sensata Technologies Holding N.V.
Sensata Technologies Holding N.V. is one of the world’s leading suppliers of sensing, electrical protection, control and power management solutions with operations and business centers in fourteen countries. Sensata’s products improve safety, efficiency and comfort for millions of people every day in automotive, appliance, aircraft, industrial, military, heavy vehicle, heating, air-conditioning and ventilation, data, telecommunications, recreational vehicle and marine applications. For more information, please visit Sensata’s website at
Safe Harbor Statement
This earnings release contains forward-looking statements within the meaning of the federal securities laws. These statements relate to analyses and other information, which are based on forecasts of future results and estimates of amounts not yet determinable, and our future prospects, developments, and business strategies. Such forward-looking statements include, among other things, our anticipated results for the second quarter and full year 2016. Such statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Factors that might cause these differences include, but are not limited to, risks associated with: adverse conditions in the automotive industry; competitive pressures that could require us to lower prices or could result in reduced demand for our products; integration of acquired companies, including CST and Schrader; the assumption of known and unknown liabilities in the acquisition of CST and Schrader; risks associated with our non-US operations and international business; litigation and disputes involving us, including the extent of intellectual property, product liability, warranty, and recall claims asserted against us; risks associated with our historical and future tax positions; risks associated with labor disruptions or increased labor costs; risks associated with our substantial indebtedness; and risks associated with breaches and other disruptions to our information technology infrastructure. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak to results only as of the date the statements were made; and we undertake no obligation to publicly update or revise any forward-looking statements, whether to reflect any future events or circumstances or otherwise. For a discussion of potential risks and uncertainties, please refer to the risk factors listed in our SEC filings. Copies of our filings are available from our Investor Relations department or from the SEC website,
SENSATA TECHNOLOGIES HOLDING N.V.
(Unaudited)
(In 000s, except per share amounts)
For the three months ended
796,549
750,685
Operating costs and expenses:
528,378
506,633
31,351
30,736
Selling, general and administrative
71,931
64,396
Amortization of intangible assets
50,447
45,809
Restructuring and special charges
Total operating costs and expenses
682,962
648,294
Profit from operations
113,587
102,391
Interest expense, net
(42,268
(34,761
Other, net
(21,757
Income before taxes
76,807
45,873
Provision for income taxes
16,195
10,518
60,612
35,355
Net income per share:
Diluted
Weighted-average ordinary shares outstanding:
170,404
169,487
171,257
171,262
Condensed Consolidated Statements of Comprehensive Income
($ in 000s)
Other comprehensive (loss)/income, net of tax:
Deferred (loss)/gain on derivative instruments, net of reclassifications
(16,703
21,504
Defined benefit and retiree healthcare plans
(16,495
21,115
Comprehensive income
44,117
56,470
Condensed Consolidated Balance Sheets
December 31, 2015
Assets
Current assets:
347,987
342,263
Accounts receivable, net of allowances
525,684
467,567
Inventories
344,251
358,701
Prepaid expenses and other current assets
113,314
109,392
Total current assets
1,331,236
1,277,923
Property, plant and equipment, net
699,298
694,155
Goodwill
3,014,927
3,019,743
Other intangible assets, net
1,217,720
1,262,572
Deferred income tax assets
31,840
26,417
Other assets
66,254
18,100
Total assets
6,361,275
6,298,910
Liabilities and shareholders’ equity
Current liabilities:
Current portion of long-term debt, capital lease and other financing obligations
263,898
300,439
Accounts payable
323,214
290,779
Income taxes payable
18,279
21,968
Accrued expenses and other current liabilities
271,498
251,989
Total current liabilities
876,889
865,175
Deferred income tax liabilities
395,935
390,490
Pension and post-retirement benefit obligations
35,414
34,314
Capital lease and other financing obligations, less current portion
35,282
36,219
Long-term debt, net of discount and deferred financing costs, less current portion
3,263,693
3,264,333
Other long-term liabilities
37,773
39,803
Total liabilities
4,644,986
4,630,334
Total shareholders’ equity
1,716,289
1,668,576
Total liabilities and shareholders’ equity
Condensed Consolidated Statements of Cash Flows
Cash flows from operating activities:
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation
25,999
21,842
Amortization of deferred financing costs and discounts
Currency remeasurement loss/(gain) on debt
Share-based compensation
Loss on debt financing
19,564
Amortization of inventory step-up to fair value
Deferred income taxes
Unrealized (gain)/loss on hedges and other non-cash items
(3,974
Changes in operating assets and liabilities, net of effects of acquisitions
(10,236
(25,966
Net cash provided by operating activities
136,202
103,110
Cash flows from investing activities:
Acquisition of CST, net of cash received
(3,360
Acquisition of Schrader, net of cash received
Other acquisitions, net of cash received
Additions to property, plant and equipment and capitalized software
(34,235
(37,878
Investment in equity securities
(50,000
Net cash used in investing activities
(87,595
(34,955
Cash flows from financing activities:
Proceeds from exercise of stock options and issuance of ordinary shares
Proceeds from issuance of debt
700,000
Payments on debt
(40,308
(768,568
Payments to repurchase ordinary shares
(2,494
Payments of debt issuance costs
(20,237
Net cash used in financing activities
(42,883
(83,903
Net change in cash and cash equivalents
(15,748
Cash and cash equivalents, beginning of period
211,329
Cash and cash equivalents, end of period
195,581
Net Revenue by Business, Geography and End Market
(% of total net revenue)
Three months ended March 31,
Americas
Europe
European automotive
North American automotive
Asian automotive
Rest of world automotive
Heavy vehicle off-road
Appliance and heating, ventilation and air-conditioning
Industrial
All other
Adjusted net income is a non-GAAP financial measure. The Company defines Adjusted net income as follows: net income before certain restructuring and special charges, costs associated with financing and other transactions, deferred (gain)/loss on other hedges, depreciation and amortization expense related to the step-up in fair value of fixed and intangible assets and inventory, deferred income tax and other tax expense, amortization of deferred financing costs, and other costs. The Company believes Adjusted net income provides investors with helpful information with respect to the Company’s operating performance, and management uses Adjusted net income to evaluate its ongoing operations and for internal planning and forecasting purposes. Adjusted net income is not a measure of liquidity. See the tables below which reconcile Net income to Adjusted net income and projected GAAP earnings per share to projected Adjusted net income per share.
The following unaudited table reconciles the Company’s Net income to Adjusted net income for the
Financing and other transaction costs
19,822
Deferred (gain)/loss on other hedges
(13,273
Depreciation and amortization expense related to the step-up in fair value of fixed and intangible assets and inventory
53,866
47,346
Deferred income tax and other tax expense
Total adjustments
52,614
75,501
113,226
110,856
Weighted average diluted shares outstanding used in Adjusted net income per share calculation
Adjusted net income per diluted share
The Company’s definition of Adjusted net income includes the current tax expense/(benefit) that will be payable/(realized) on the Company’s income tax return and excludes deferred income tax and other tax expense/(benefit). As the Company treats deferred income tax and other tax expense/(benefit) as an adjustment to compute Adjusted net income, the deferred income tax effect associated with the reconciling items would not change Adjusted net income for any period presented. The theoretical current income tax expense/(benefit) associated with the reconciling items above would be as follows: Depreciation and amortization expense related to the step-up in fair value of fixed and intangible assets and inventory: $0.0 million and $0.1 million for the three months ended
, respectively; and Restructuring and special charges: $0.1 million and $0.1 million for the three months ended
, respectively.
The following unaudited table identifies where in the Condensed Consolidated Statements of Operations the adjustments to reconcile Net income to Adjusted net income were recorded for the
49,068
44,616
(9,873
18,185
The following unaudited table reconciles the Company’s projected GAAP earnings per share to projected Adjusted net income per diluted share for the three months ended June 30, 2016 and full year ended
December 31, 2016
. The amounts in the table below have been calculated based on unrounded numbers. Accordingly, certain amounts may not add due to the effect of rounding.
Full year ended
December 31, 2016
Low End
High End
Projected GAAP earnings per diluted share
Deferred income tax and other tax expense/(benefit)
Projected Adjusted net income per diluted share
Weighted average diluted shares outstanding used in Adjusted net income per share calculation (in 000s)
171,600
171,700
SENSATA TECHNOLOGIES HOLDING N.V.
Notes to unaudited Condensed Consolidated Statements of Operations, Condensed Consolidated Statements of Comprehensive Income, Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Cash Flows
Basis of Presentation
The accompanying unaudited Condensed Consolidated Statements of Operations, Condensed Consolidated Statements of Comprehensive Income, Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Cash Flows do not include all of the information and note disclosures required by accounting principles generally accepted in the United States of America for complete financial statements. This information should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements. Estimates used may change as new events occur or additional information is obtained. Actual results could differ from those estimates.
Contacts:
Investors:
News Media:
Jacob Sayer
Alexia Taxiarchos
(508) 236-3800
(508) 236-1761
investors@sensata.com
ataxiarchos@sensata.com
The above information was disclosed in a filing to the SEC. To see the filing, click .
To receive a free e-mail notification whenever Sensata Technologies Holding N.V. makes a similar move,
Other recent filings from the company include the following:
- April 21, 2016
- April 7, 2016
- April 7, 2016
- April 7, 2016