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Amphenol Corporation reported today record GAAP Diluted Earnings Per Share (EPS) for the second quarter 2017 of $0.80 compared to $0.65 for the comparable 2016 period. GAAP Diluted EPS for the second quarter 2017 included a charge for acquisition-related transaction costs of approximately $4 million ($0.01 per share). Excluding the effect of this item, second quarter 2017 Adjusted Diluted EPS1 was a record $0.81 compared to $0.65 for the comparable 2016 period. Sales for the second quarter of 2017 were a record $1.667 billion compared to $1.548 billion for the comparable 2016 period. Currency translation had the effect of decreasing sales by approximately $18 million in the second quarter of 2017 compared to the 2016 period.
For the six months ended June 30, 2017, GAAP Diluted EPS was $1.51, compared to $1.15 for the comparable 2016 period. The 2017 and 2016 periods include acquisition-related costs of $4 million ($0.01 per share) discussed above and $30 million ($0.09 per share), respectively. Excluding the effect of these items, Adjusted Diluted EPS for the six months ended June 30, 2017 and 2016 was $1.52 and $1.24, respectively. Sales for the six months ended June 30, 2017 were $3.227 billion compared to $2.999 billion for the 2016 period. Currency translation had the effect of decreasing sales by approximately $36 million for the first six months of 2017 compared to the 2016 period.
The Company’s Board of Directors has approved an increase in the Company’s quarterly dividend from $0.16 to $0.19 per share to be paid on or about October 11, 2017 to holders of record of the Company’s Class A common stock as of September 18, 2017.
Amphenol President and Chief Executive Officer, R. Adam Norwitt, stated, “We are very pleased to close the second quarter 2017 above the high end of our guidance with record sales, GAAP Diluted EPS and Adjusted Diluted EPS in the quarter of $1.667 billion, $0.80 and $0.81, respectively. We achieved these record results despite the ongoing geopolitical and economic uncertainties affecting the global economy. Compared to the second quarter 2016, sales increased by 8%, reflecting strong diversified growth across the Company’s markets including automotive, military, industrial, information technology and data communications, and broadband markets, partially offset by lower demand in the mobile device market. Our excellent performance was driven both organically and through the Company’s successful acquisition program. GAAP and Adjusted Diluted EPS grew by 23% and 25%, respectively in the quarter compared to the second quarter of 2016. This earnings growth was driven by our strong operating results, as reflected in the Company’s Adjusted Operating Margin of 20.4% in the second quarter 2017, as well as a lower than expected effective tax rate due to the tax benefit from the Company’s stock compensation program. I am very proud of our organization as we continue to execute extremely well.”
“The Company continues to expand its growth opportunities through a deep commitment to developing enabling technologies for customers in all markets, an ongoing strategy of market and geographic diversification, as well as an active acquisition program. As part of that program, we are excited to have recently closed on three new acquisitions involving five distinct businesses. In late June 2017, the Company acquired three sensor-related businesses from Meggitt PLC (LON: MGGT). The Meggitt sensor businesses design and produce vibration and position sensors as well as ultrasonic transducers for industrial, automotive and military applications with aggregate annual sales of approximately $75 million. Also in late June, the Company acquired Intelligente Sensorsysteme Dresden GmbH (i2S). i2S, based in Germany, designs and produces pressure, temperature and mass airflow sensors for automotive and industrial applications and has annual sales of approximately $45 million. Finally, in early July, the Company acquired Telect, Inc. (Telect). Telect, based in Liberty Lake, WA, is a manufacturer of DC power distribution as well as fiber and copper interconnect products for data centers in the broadband, information technology and data communications and mobile networks markets with annual sales of approximately $45 million. These acquisitions collectively strengthen the Company’s global capabilities and enhance our product offering across a number of our diversified end markets.”
“Operating cash flow in the quarter was $280 million, a clear confirmation of the quality of the Company’s earnings. The Company continues to deploy its financial strength in a variety of ways to increase shareholder value. This includesthe purchase during the second quarter of 2.0 million shares of the Company’s stock under our $1 billion two-year open market stock repurchase plan bringing total repurchases for the plan to approximately 5.7 million shares, or $400 million. In addition, the Board of Directors has approved a 19% increase in our quarterly dividend, from $0.16 to $0.19 per share.”
“The economic environment remains uncertain, including the dynamics related to any potential government policy changes and the geopolitical climate. Considering this environment and based on current currency exchange rates, we expect third quarter 2017 sales in the range of $1.700 billion to $1.740 billion and GAAP and Adjusted Diluted EPS in the range of $0.77 to $0.79. For the full year 2017, we now expect to achieve sales in the range of $6.620 billion to $6.700 billion, an increase over 2016 of 5% to 7%. We also expect GAAP Diluted EPS of $3.05 to $3.09, an increase of 17% to 18% over 2016 and an Adjusted Diluted EPS of $3.06 to $ 3.10, an increase of 13% to 14% over 2016. Our current full year guidance now reflects an effective tax rate of 23% to 24%. This compares to our prior full year 2017 guidance of $6.405 billion to $6.525 billion in sales and GAAP and Adjusted Diluted EPS of $2.91 to $2.97 which reflected a full year effective tax rate of 25% to 26%.”
“The electronics revolution continues to create exciting, long-term growth opportunities for Amphenol. We remain very confident for the future, with new applications and higher performance requirements driving increased demand for our broadened range of high technology products across all of our diversified end markets. Our ongoing actions to strengthen our competitive advantages and build sustained financial strength, as well as our initiatives to expand our high technology product offering both organically and through our successful acquisition program, have created an excellent base for future performance.
I am confident in the ability of our outstanding management team to dynamically adjust to the constantly changing environment, to continue to generate strong profitability and to further capitalize on the many opportunities to expand our market position.”
About Amphenol Corporation
Amphenol Corporation is one of the world’s largest designers, manufacturers and marketers of electrical, electronic and fiber optic connectors, interconnect systems, antennas, sensors and sensor-based products and coaxial and high-speed specialty cable. Amphenol designs, manufactures and assembles its products at facilities in the Americas, Europe, Asia, Australia and Africa and sells its products through its own global sales force, independent representatives and a global network of electronics distributors. Amphenol has a diversified presence as a leader in high growth areas of the interconnect market including: Automotive, Broadband Communications, Commercial Aerospace, Industrial, Information Technology and Data Communications, Military, Mobile Devices and Mobile Networks.