CTS Announces Second Quarter 2021 Results
Strong Performance in a Challenging Supply Chain Environment
Lisle, Ill. – CTS Corporation (NYSE: CTS) today announced the Second quarter 2021 results.
- Sales were $129.6 million, up 54% year-over-year. Sales to transportation customers increased 88%, and sales to other end markets grew 26%. The Sensor Scientific acquisition added $1.6 million of sales in the second quarter of 2021.
- Net earnings were $0.9 million or $0.03 per diluted share versus $4.9 million or $0.15 per diluted share in the second quarter of last year. The second quarter net earnings were impacted by a non-cash charge of $20.1 million related to the previously communicated termination of the U.S. pension plan.
- Adjusted diluted EPS was $0.52, up from $0.16 in the second quarter of 2020.
- Free cash flow was $16.3 million, up from $9.1 million in the second quarter of 2020.
- New business wins were $174 million.
“We delivered another quarter of strong sales and earnings in a challenging supply chain environment. I am proud of the execution by our global teams to meet our customers’ needs”, said Kieran O’Sullivan, CEO of CTS Corporation. “We continue to advance our diversification strategy by growing in the industrial, medical, and aerospace and defense end markets, enhanced by stronger new business wins.”
While management remains mindful of supply chain uncertainties, CTS is updating its 2021 guidance for sales from $445 – $500 million to $480 – $500 million, and for adjusted diluted EPS from $1.35 – $1.70 to $1.70 – $1.90.
As previously announced, the Company has scheduled a conference call at 10:00 a.m. (EST) today to discuss the second quarter financial results. The dial-in number is 800-309-1256 (323-347-3622, if calling from outside the U.S.). The passcode is 960176. A replay of the conference call will be available from 1:00 p.m. (EST) on Tuesday, July 27, 2021 through 1:00 p.m. (EST) on Tuesday, August 10, 2021. The telephone number for the replay is 888-203-1112 (719-457-0820, if calling from outside the U.S.). The replay passcode is 6658189. 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.
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.
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
4925 Indiana Avenue
Lisle, IL 60532
Telephone: +1 (630) 577-8800
Non-GAAP Financial Measures
From time to time, CTS may use non-GAAP financial measures in discussing CTS’ business. These measures are intended to supplement, not replace, CTS’ presentation of its financial results in accordance with GAAP. CTS’ management believes that non-GAAP financial measures can be useful to investors in analyzing CTS financial performance and results of operations over time. CTS recommends that investors consider both actual and adjusted measures in evaluating the performance of CTS with peer companies.
Adjusted Diluted Earnings Per Share
Adjusted diluted earnings per share is a non-GAAP financial measure. The most directly comparable GAAP financial measure is diluted earnings per share.
CTS uses 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.
Free Cash Flow
Free cash flow is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net cash provided by operating activities. CTS believes free cash flow is a useful measure of its ability to generate cash.