CTS
$36.15
Cts
$.65
1.83%
Earnings Details
1st Quarter March 2018
Thursday, April 26, 2018 8:00:00 AM
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Summary

CTS Reaffirms

Cts (CTS) reported 1st Quarter March 2018 earnings of $0.34 per share on revenue of $113.5 million. The consensus earnings estimate was $0.30 per share on revenue of $105.2 million. Revenue grew 13.4% on a year-over-year basis.

The company said it continues to expect 2018 earnings of $1.32 to $1.44 per share on revenue of $435.0 million to $455.0 million. The current consensus earnings estimate is $1.33 per share on revenue of $443.1 million for the year ending December 31, 2018.

CTS Corp is a designer and manufacturer of electronic components and sensors to OEMs in the automotive, communications, medical, defense and aerospace, industrial and computer markets. The Company manufactures products in North America, Europe and Asia.

Results
Reported Earnings
$0.34
Earnings Whisper
-
Consensus Estimate
$0.30
Reported Revenue
$113.5 Mil
Revenue Estimate
$105.2 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

CTS Announces First Quarter 2018 Results

LISLE, Ill., April 26, 2018 (GLOBE NEWSWIRE) -- CTS Corporation (NYSE:CTS) today announced first quarter 2018 results.

  • Sales were $113.5 million, up 13.4% year-over-year. Sales to automotive customers increased 11.9%, and sales of electronic components increased 16.2%. The Noliac acquisition, completed in May 2017, added $2.6 million of sales in the first quarter of 2018.
  • Net earnings were $11.5 million or $0.34 per diluted share compared to $8.5 million or $0.25 per diluted share in the first quarter of 2017.
  • Adjusted EPS was $0.34 per diluted share, up 31% from $0.26 in the first quarter of 2017.
  • Total Booked Business was $1.762 billion at the end of the first quarter of 2018, an increase of $25 million from the fourth quarter of 2017.

“We had a good start to 2018, delivering strong sales and earnings growth, and increasing total booked business,” said Kieran O’Sullivan, CEO of CTS Corporation. “We are pleased that our revenue growth strategies are starting to gain traction, and we see continued opportunities to improve operational results.”

2018 Guidance

Management reaffirms its prior guidance. Full year 2018 sales are expected to be in the range of $435 to $455 million. Adjusted earnings per diluted share for 2018 are expected to be in the range of $1.32 to $1.44.

Conference Call

As previously announced, the Company has scheduled a conference call at 11:00 a.m. (EDT) today to discuss the first quarter financial results. The dial-in number is 866-564-7440 (719-325-2120, if calling from outside the U.S.).  The passcode is 970409. There will be a replay of the conference call from 2:00 p.m. (EDT) today through 2:00 p.m. (EDT) on Thursday, May 10, 2018.  The telephone number for the replay is 866-375-1919 (719-457-0820, if calling from outside the U.S.).  The replay passcode is 8486171. A live audio webcast of the conference call will be available and can be accessed directly from the Investors section of the website of CTS Corporation at www.ctscorp.com.

About CTS

CTS (NYSE:CTS) is a leading designer and manufacturer of products that Sense, Connect, and Move. The company manufactures sensors, actuators, and electronic components in North America, Europe, and Asia, and provides engineered products to customers in the aerospace/defense, industrial, medical, telecommunications/IT, and transportation markets.

For more information, visit www.ctscorp.com.

Safe Harbor

This document contains statements that are, or may be deemed to be, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, any financial or other guidance, statements that reflect our current expectations concerning future results and events, and any other statements that are not based solely on historical fact. Forward-looking statements are based on management's expectations, certain assumptions and currently available information. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof and are based on various assumptions as to future events, the occurrence of which necessarily are subject to uncertainties. These forward-looking statements are made subject to certain risks, uncertainties and other factors, which could cause our actual results, performance or achievements to differ materially from those presented in the forward-looking statements. Many of these, and other risks and uncertainties, are discussed in further detail in Item 1A. of CTS’ Annual Report on Form 10-K. We undertake no obligation to publicly update our forward-looking statements to reflect new information or events or circumstances that arise after the date hereof, including market or industry changes.

Contact

Ashish Agrawal
Vice President and Chief Financial Officer

CTS Corporation
4925 Indiana Avenue
Lisle, IL 60532
USA

Telephone: +1 (630) 577-8800
E-mail: ashish.agrawal@ctscorp.com

CTS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - UNAUDITED
(In thousands of dollars, except per share amounts)

 Three Months Ended
 March 31, March 31,
 2018 2017
Net sales$113,530  $100,154 
Cost of goods sold75,097  65,930 
Gross Margin38,433  34,224 
Selling, general and administrative expenses17,372  15,248 
Research and development expenses6,507  6,003 
Restructuring charges1,195  777 
Operating earnings13,359  12,196 
Other income (expense):   
Interest expense(541) (684)
Interest income482  253 
Other income, net2,004  460 
Total other income1,945  29 
Earnings before income taxes15,304  12,225 
Income tax expense3,756  3,741 
Net earnings$11,548  $8,484 
Earnings per share:   
Basic$0.35  $0.26 
Diluted$0.34  $0.25 
    
Basic weighted – average common shares outstanding:32,975  32,802 
Effect of dilutive securities540  560 
Diluted weighted – average common shares outstanding33,515  33,362 
    
Cash dividends declared per share$0.04  $0.04 
        

CTS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of dollars)

 (Unaudited)  
 March 31, December 31,
 2018 2017
ASSETS   
Current Assets   
Cash and cash equivalents$121,383  $113,572 
Accounts receivable, net69,948  70,584 
Inventories, net37,941  36,596 
Other current assets13,266  12,857 
Total current assets242,538  233,609 
Property, plant and equipment, net90,685  88,247 
Other Assets   
Prepaid pension asset58,494  57,050 
Goodwill71,057  71,057 
Other intangible assets, net65,246  66,943 
Deferred income taxes18,428  20,694 
Other2,244  2,096 
Total other assets215,469  217,840 
Total Assets$548,692  $539,696 
LIABILITIES AND SHAREHOLDERS’ EQUITY   
Current Liabilities   
Accounts payable$51,937  $49,201 
Accrued payroll and benefits8,497  11,867 
Accrued liabilities42,027  41,344 
Total current liabilities102,461  102,412 
Long-term debt74,000  76,300 
Long-term pension obligations7,148  7,201 
Deferred income taxes3,398  3,802 
Other long-term obligations5,953  6,176 
Total Liabilities192,960  195,891 
Commitments and Contingencies   
Shareholders’ Equity   
Common stock305,722  304,777 
Additional contributed capital39,681  41,084 
Retained earnings430,388  420,160 
Accumulated other comprehensive loss(76,803) (78,960)
Total shareholders’ equity before treasury stock698,988  687,061 
Treasury stock(343,256) (343,256)
Total shareholders’ equity355,732  343,805 
Total Liabilities and Shareholders’ Equity$548,692  $539,696 
        

CTS CORPORATION AND SUBSIDIARIES
OTHER SUPPLEMENTAL INFORMATION

Earnings Per Share

The following table reconciles GAAP diluted earnings per share to adjusted diluted earnings per share for the Company:

Additional Information

The following table includes other financial information not presented in the preceding financial statements.

 Three Months Ended
 March 31, 2018 March 31, 2017
GAAP diluted earnings per share$0.34  $0.25 
    
Tax affected adjustments to reported diluted earnings per share:   
Restructuring charges0.03  0.02 
Foreign currency gains(0.04) (0.01)
Non-recurring costs of tax improvement initiatives0.01   
Adjusted diluted earnings per share$0.34  $0.26 
        

Additional Information

The following table includes other financial information not presented in the preceding financial statements.

 Three Months Ended
 March 31, 2018 March 31, 2017
Depreciation and amortization expense$5,483  $4,708 
Stock-based compensation expense$923  $880 
        

Non-GAAP Financial Measures

Adjusted earnings per share is a non-GAAP financial measure.  The most directly comparable GAAP financial measure is diluted earnings per share.

CTS adjusts for these items because they are discrete events, which have a significant impact on comparable GAAP financial measures and could distort an evaluation of our normal operating performance.

CTS uses an adjusted earnings per share measure to evaluate overall performance, establish plans and perform strategic analysis.  Using this measure avoids distortion in the evaluation of operating results by eliminating the impact of events which are not related to normal operating performance.  Because this measure is based on the exclusion or inclusion of specific items, they may not be comparable to measures used by other companies which have similar titles.  CTS' management compensates for this limitation when performing peer comparisons by evaluating both GAAP and non-GAAP financial measures reported by peer companies.  CTS believes that this measure is useful to its management, investors and stakeholders in that it:

  • provides a meaningful measure of CTS' operating performance,

  • reflects the results used by management in making decisions about the business, and

  • helps review and project CTS' performance over time.

We recommend that investors consider both actual and adjusted measures in evaluating the performance of CTS with peer companies.

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Source: CTS Corporation