CTS Announces First Quarter 2016 Results
Sequential sales growth for the last two quarters
Operating earnings grow 18.5% year over year
Elkhart, IN – CTS Corporation (NYSE: CTS) today announced first quarter 2016 results.
- Sales were $96.7 million, up 3.7% from the fourth quarter of 2015 and down 1.6% from the first quarter of 2015. First quarter sales to automotive customers increased 4.7%, and sales of electronic components increased 1.5% from the fourth quarter of 2015. The company’s acquisition of CTG Advanced Materials, completed on March 11, 2016, added $0.8 million of sales in the first quarter of 2016.
- GAAP operating earnings were $12.4 million, up 18.5% from the first quarter of 2015.
- GAAP net earnings were $7.9 million or $0.24 per diluted share compared to earnings of $6.3 million or $0.19 per diluted share in the first quarter of 2015.
- Adjusted EPS was $0.26 versus $0.20 in the first quarter of 2015. Adjusted EPS excludes the impact of balance sheet currency translation in the first quarter of 2016. The adjusted EPS for the first quarter of 2015 included an unfavorable currency impact of approximately $0.04.
- New business awards were $118 million in the first quarter.
“We are encouraged by the sales growth for the last two quarters,” said Kieran O’Sullivan, CEO of CTS Corporation. “Our gross margin and operating earnings improved as we maintained our focus on operational efficiency. We continue to execute our strategy to drive growth around products that Sense, Connect and Move. We posted another solid quarter of new business wins and completed the recent acquisition of CTG Advanced Materials, which provides growth opportunities with a leading-edge technology in existing and new markets.”
Management continues to monitor trends in CTS’ end markets and expects full year 2016 sales in the range of $390 to $410 million, which includes sales related to the single crystal acquisition. Adjusted earnings per diluted share for 2016 are expected to be in the range of $0.95 to $1.06.
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 888-500-6950 (719-457-2697, if calling from outside the U.S.). The conference I.D. number is 6467436. There will be a replay of the conference call from 2:00 p.m. (EDT) today through 2:00 p.m. (EDT) on Tuesday, May 17, 2016. The telephone number for the replay is 888-203-1112 (719-457-0820, if calling from outside the U.S.). The access code is 6467436. Also, please note that a live audio webcast of the conference call will be available and can be accessed directly from the website of CTS Corporation www.ctscorp.com.
CTS (NYSE: CTS) is a leading designer and manufacturer of sensors, actuators and electronic components to OEMs in the aerospace, communications, defense, industrial, information technology, medical and transportation markets. CTS manufactures products in North America, Europe and Asia.
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.
Vice President and Chief Financial Officer
2375 Cabot Drive
Lisle, IL 60532
Telephone: +1 (574) 523-3800
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.