U.S. Markets open in 5 hrs 54 mins

Amphenol Beats by a Penny

Zacks Equity Research

Amphenol Corporation (APH) reported a net income of 90 cents per share in the third quarter of 2012 beating the Zacks Consensus Estimate by a penny. The quarter's results were ahead of 86 cents per share reported in the prior quarter as well as the year-ago figure of 79 cents per share. 

Sales came in at a record $1.103 billion, up 6.7% year over year and 3.9% sequentially, and beat management’s guidance range of $1.080 billion to $1.100 billion. The results also surpassed the Zacks Consensus Estimate of $1.091 billion. The unfavorable foreign currency exchange rates negatively impacted sales by approximately $19 million in the third quarter of 2012.


On a year-over-year basis, Amphenol saw strength in industrial, commercial aerospace and telecommunications and data communications equipment markets. Compared with the prior quarter, mobile devices emerged as a growth driver for the company based on the ramp up of new mobile computing devices. 


Product-wise, Interconnect products generated sales of $1,033.3 million, up 7.9% year over year. Cable products generated sales of $70.0 million, down 7.3% year over year.


Gross margin came in at 31.2%, marginally down from 31.5% in the previous quarter, but roughly flat on a year-over-year basis. Operating margin improved to 19.5% from 19.4% in the previous quarter and 18.0% in the year-ago quarter. 


During the quarter, Amphenol purchased 0.5 million shares. Amphenol ended the quarter with cash and cash equivalents of $725.5 million, up from $646.0 million at the end of the previous quarter. Debt at the end of the quarter increased to $1,511.3 million from $1,454.5 million at the end of the previous quarter. Earlier, Amphenol increased the quarterly dividend to $0.105 per share. 




Assuming stable economic conditions and current currency exchange rates, Amphenol projects sales between $1.095 billion and $1.115 billion in the fourth quarter of 2012. Earnings per share (excluding one-time items) are forecasted between 88 cents and 91 cents. 


For 2012, management now projects revenues between $4.241 billion and $4.261 billion compared with its earlier revenue estimate between $4.210 billion and $4.250 billion and up 8% from 2011. Earnings per share are expected between $3.41 and $3.44 versus the previous estimate of $3.38 to $3.44 and up 12% – 13% from 2011.


The ongoing revolution in electronics continues to create opportunities for Amphenol, which competes with Molex Incorporated ( MOLX). The company serves a variety of end markets and the diversification in those markets enables it to post strong results even amid an uncertain economic environment.

Read the Full Research Report on APH

Read the Full Research Report on MOLX

Zacks Investment Research

More From Zacks.com