CLEVELAND, May 1, 2024
/PRNewswire/ -- Preformed Line Products Company (NASDAQ: PLPC)
today reported financial results for its first quarter of 2024.
Net sales in the first quarter of 2024 were $140.9 million compared to $181.8 million in the first quarter of 2023, a
22% decrease due primarily to a slowdown in spending within the
communications end market. Foreign currency translation increased
first quarter 2024 net sales by $0.7
million.
Net income for the quarter ended March
31, 2024 was $9.6 million, or
$1.94 per diluted share, compared to
$21.4 million, or $4.28 per diluted share, for the comparable
period in 2023. Net income for the quarter was lower as a result of
decreased gross margins caused by the lower sales level, partially
offset by a reduction in selling, general and administrative
expenses due to cost containment efforts. Gross profit as a
percentage of net sales was 31.3% for the first quarter of
2024.
Rob Ruhlman, Executive Chairman,
said, "The decrease in quarterly net sales is a continuation of the
decline in market demand that we saw coming mid-2023.
Softness in communications end market demand continues to be caused
by the higher borrowing rates, delayed BEAD stimulus funding, as
well as elevated inventory levels, largely due to the overbuying
that occurred in 2022 and early 2023. Our spend thrift
philosophy as well as cost reduction activities instituted in
mid-2023 led to reduced spending in areas not impacting customer
service experience. Our excitement about the prospects of the
markets that we serve allows us to continue our investment in new
product development, streamlining our manufacturing operations and
expanding our customer service portfolio. These actions,
along with our continued strong liquidity, will allow us to take
advantage of favorable market conditions when they return.
Our current focus is unchanged: provide our
customers with the high-quality products and timely
service they have come to expect from PLP."
FORWARD-LOOKING STATEMENTS
This news release contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934 regarding the
Company, including those statements regarding the Company's and
management's beliefs and expectations concerning the Company's
future performance or anticipated financial results, among others.
Except for historical information, the matters discussed in this
release are forward-looking statements that involve risks and
uncertainties which may cause results to differ materially from
those set forth in those statements. Among other things, factors
that could cause actual results to differ materially from those
expressed in such forward-looking statements include the
uncertainty in global business conditions and the economy due to
factors such as inflation, rising interest rates, labor
disruptions, military conflict, international hostilities,
political instability, exchange rates and public health concerns,
the strength of demand and availability of funding for the
Company's products and the mix of products sold, the relative
degree of competitive and customer price pressure on the Company's
products, the impact of stimulus programs in driving demand, the
cost, availability and quality of raw materials required for the
manufacture of products, opportunities for business growth through
acquisitions and the ability to successfully integrate, and
implement appropriate internal controls in, any acquired
businesses, changes in regulations and tax rates, security
breaches, litigation and claims and the Company's ability to
continue to develop proprietary technology and maintain
high-quality products and customer service to meet or exceed new
industry performance standards and individual customer
expectations, and other factors described under the headings
"Forward-Looking Statements" and "Risk Factors" in the Company's
2023 Annual Report on Form 10-K filed with the SEC on March 8, 2024 and subsequent filings with the
SEC. The Annual Report on Form 10-K and the Company's other filings
with the SEC can be found on the SEC's website at
http://www.sec.gov. The Company assumes no obligation to update or
supplement forward-looking statements that become untrue because of
subsequent events.
ABOUT PLP
PLP protects the world's most critical connections by creating
stronger and more reliable networks. The company's
precision-engineered solutions are trusted by energy and
communications providers worldwide to perform better and last
longer. With locations in 20 countries, PLP works as a united
global corporation, delivering high-quality products and
unparalleled service to customers around the world.
PREFORMED LINE
PRODUCTS COMPANY
|
|
|
|
|
CONSOLIDATED BALANCE
SHEETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2024
|
|
December 31,
2023
|
(Thousands of dollars, except share and per share data)
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
Cash, cash equivalents
and restricted cash
|
|
$
45,859
|
|
$
53,607
|
Accounts receivable,
net
|
|
111,527
|
|
106,892
|
Inventories,
net
|
|
141,508
|
|
148,814
|
Prepaid
expenses
|
|
8,314
|
|
8,246
|
Other current
assets
|
|
7,053
|
|
7,256
|
TOTAL CURRENT
ASSETS
|
|
314,261
|
|
324,815
|
Property, plant and
equipment, net
|
|
203,242
|
|
207,892
|
Goodwill
|
|
28,603
|
|
29,497
|
Other intangible
assets, net
|
|
11,868
|
|
12,981
|
Deferred income
taxes
|
|
7,379
|
|
7,109
|
Other assets
|
|
20,756
|
|
20,857
|
TOTAL
ASSETS
|
|
$
586,109
|
|
$
603,151
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
Trade accounts
payable
|
|
$
41,748
|
|
$
37,788
|
Notes payable to
banks
|
|
1,487
|
|
6,968
|
Current portion of
long-term debt
|
|
7,078
|
|
6,486
|
Accrued compensation
and other benefits
|
|
23,348
|
|
28,018
|
Accrued expenses and
other liabilities
|
|
26,043
|
|
32,057
|
TOTAL CURRENT
LIABILITIES
|
|
99,704
|
|
111,317
|
Long-term debt, less
current portion
|
|
47,928
|
|
48,796
|
Other noncurrent
liabilities and deferred income taxes
|
|
25,109
|
|
26,882
|
SHAREHOLDERS'
EQUITY
|
|
|
|
|
Common shares – $2 par
value per share, 15,000,000 shares authorized, 4,918,036 and
4,908,413 issued and outstanding, at March 31, 2024 and December
31, 2023
|
|
13,711
|
|
13,607
|
Common shares issued to
rabbi trust, 238,641 and 243,118 shares at March 31, 2024 and
December 31, 2023, respectively
|
|
(10,214)
|
|
(10,183)
|
Deferred compensation
liability
|
|
10,214
|
|
10,183
|
Paid-in
capital
|
|
61,408
|
|
60,958
|
Retained
earnings
|
|
528,733
|
|
520,154
|
Treasury shares, at
cost, 1,937,150 and 1,894,419 shares at March 31, 2024 and December
31, 2024, respectively
|
|
(123,701)
|
|
(118,249)
|
Accumulated other
comprehensive loss
|
|
(66,782)
|
|
(60,306)
|
TOTAL PREFORMED LINE
PRODUCTS COMPANY SHAREHOLDERS' EQUITY
|
|
413,369
|
|
416,164
|
Noncontrolling
interest
|
|
(1)
|
|
(8)
|
TOTAL SHAREHOLDERS'
EQUITY
|
|
413,368
|
|
416,156
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|
$
586,109
|
|
$
603,151
|
|
|
|
|
|
See notes to
consolidated financial statements (unaudited).
|
|
|
|
|
PREFORMED LINE
PRODUCTS COMPANY
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|
|
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STATEMENTS OF
CONSOLIDATED INCOME
|
|
|
|
|
Three Months Ended
March 31,
|
|
2024
|
|
2023
|
(Thousands of dollars, except share and per share data)
|
|
|
|
Net sales
|
$
140,904
|
|
$
181,824
|
Cost of products
sold
|
96,773
|
|
115,541
|
GROSS
PROFIT
|
44,131
|
|
66,283
|
Costs and
expenses
|
|
|
|
Selling
|
11,900
|
|
12,388
|
General and
administrative
|
16,608
|
|
18,609
|
Research and
engineering
|
5,431
|
|
5,193
|
Other operating
expense, net
|
(1,367)
|
|
1,112
|
|
32,572
|
|
37,302
|
OPERATING
INCOME
|
11,559
|
|
28,981
|
Other (expense)
income
|
|
|
|
Interest
income
|
972
|
|
304
|
Interest
expense
|
(708)
|
|
(1,066)
|
Other income,
net
|
35
|
|
40
|
|
299
|
|
(722)
|
INCOME BEFORE INCOME
TAXES
|
11,858
|
|
28,259
|
Income tax
expense
|
2,255
|
|
6,840
|
NET
INCOME
|
$
9,603
|
|
$
21,419
|
Net income attributable
to noncontrolling interests
|
(7)
|
|
(21)
|
NET INCOME
ATTRIBUTABLE TO PREFORMED LINE PRODUCTS COMPANY
SHAREHOLDERS
|
$
9,596
|
|
$
21,398
|
AVERAGE NUMBER OF
SHARES OF COMMON STOCK OUTSTANDING:
|
|
|
|
Basic
|
4,915
|
|
4,937
|
Diluted
|
4,944
|
|
4,997
|
EARNINGS PER SHARE
OF COMMON STOCK ATTRIBUTABLE TO PREFORMED LINE PRODUCTS COMPANY
SHAREHOLDERS:
|
|
|
|
Basic
|
$
1.95
|
|
$
4.33
|
Diluted
|
$
1.94
|
|
$
4.28
|
|
|
|
|
Cash dividends declared
per share
|
$
0.20
|
|
$
0.20
|
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SOURCE Preformed Line Products