PR Newswire | Oct 30, 2020 08:30AM EDT

Results

10/30 07:30 CDT

Preformed Line Products Announces Third Quarter And First Nine Months Of 2020 Results MAYFIELD VILLAGE, Ohio, Oct. 30, 2020

MAYFIELD VILLAGE, Ohio, Oct. 30, 2020 /PRNewswire/ -- Preformed Line Products Company(NASDAQ: PLPC) today reported financial results for its third quarter and first nine months of 2020.

Net income for the quarter ended September 30, 2020 was $13.0 million, or $2.59 per diluted share, compared to $8.0 million, or $1.55 per diluted share, for the comparable period in 2019.

Net sales in the third quarter of 2020 increased 7% to $127.5 million, compared to $119.2 million in the third quarter of 2019.

Net income for the nine months ended September 30, 2020 was $27.1 million, or $5.43 per diluted share, compared to $17.7 million, or $3.48 per diluted share, for the comparable period in 2019.

Net sales increased 5% to $347.9 million for the first nine months of 2020 compared to $331.2 million in the first nine months of 2019.

Currency translation rates unfavorably impacted net sales by $3.7 million for the quarter and $15.0 million for the nine months ended September 30, 2020. Currency had an unfavorable impact on net income of $.3 million for the quarter and $1.0 million for the first nine months of 2020.

Rob Ruhlman, Chairman and Chief Executive Officer, said, "The record quarterly net sales, net income and diluted earnings per share for the three months ended September 30, 2020 are a testament to the hard work and dedication of every employee at PLP. COVID-19 has created new challenges for us to deal with as a company but also new opportunities. Our number one priority continues to be the protection of our employees and their families through rigorous safety measures that we have put in place due to COVID-19. The sacrifices made by our employees this year have enabled PLP to meet customer requirements in all regions, most notably the U.S. market. One opportunity created by COVID-19 has been the increase in PLP-USA sales made possible by the significance of our uninterrupted U.S. based manufacturing facilities in Albemarle, North Carolina and Rogers, Arkansas. Maintaining and growing our U.S. manufacturing footprint enables PLP to provide excellent customer service to our U.S. and export customer base. The challenges brought on by COVID-19 may be with us for some time. While the extent to which COVID-19 will impact our future operations is unknown, we will continue to focus on the safety and well-being of our employees, their families, our customers and our valued suppliers while continuing to provide the high quality products and services our customers appreciate."

Founded in 1947, Preformed Line Products is an international designer and manufacturer of products and systems employed in the construction and maintenance of overhead and underground networks for energy, communications, and broadband network companies.

Preformed's world headquarters are in Cleveland, Ohio, and the Company operates two domestic manufacturing centers located in Rogers, Arkansas, and Albemarle, North Carolina. The Company serves its worldwide market through international operations in Argentina, Australia, Austria, Brazil, Canada, China, Colombia, Czech Republic, England, France, Indonesia, Malaysia, Mexico, New Zealand, Poland, Russia, South Africa, Spain, Thailand and Vietnam.

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 business conditions and economy due to COVID-19 including the severity and duration of business disruption caused by the pandemic, the strength of the economy and demand 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 cost, availability and quality of raw materials required for the manufacture of products, 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 2019 Annual Report on Form 10-K filed with the SEC on March 6, 2020 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.

PREFORMED LINE PRODUCTS COMPANY

CONSOLIDATED BALANCE SHEETS

September 30, December 31,

(Thousands of dollars, except share and per share data) 2020 2019

ASSETS

Cash and cash equivalents $ 41,248 $ 38,929

Accounts receivable, less allowances of $3,536 ($3,849 in 2019) 96,712 83,517

Inventories - net 94,315 95,718

Prepaids 11,130 9,522

Other current assets 2,517 4,289

TOTAL CURRENT ASSETS 245,922 231,975

Property, plant and equipment - net 134,440 124,018

Other intangibles - net 13,926 15,116

Goodwill 27,689 27,840

Deferred income taxes 6,515 7,564

Other assets 23,549 27,058

TOTAL ASSETS $ 452,041 $ 433,571

LIABILITIES AND SHAREHOLDERS' EQUITY

Trade accounts payable $ 30,299 $ 28,282

Notes payable to banks 15,582 8,696

Current portion of long-term debt 7,198 3,354

Accrued compensation and amounts withheld from employees 17,764 11,817

Accrued expenses and other liabilities 27,352 28,924

TOTAL CURRENT LIABILITIES 98,195 81,073

Long-term debt, less current portion 45,220 53,722

Other noncurrent liabilities and deferred income taxes 29,048 30,208

SHAREHOLDERS' EQUITY

Shareholders' equity:

Common shares - $2 par value, 15,000,000 shares authorized, 4,914,543 and

4,992,979 issued and outstanding, as of September 30, 2020 13,013 12,848 and December 31, 2019

Common shares issued to rabbi trust, 265,508 and 267,641 shares at

September 30, 2020 and December 31, 2019, respectively (10,940) (10,981)

Deferred Compensation Liability 10,940 10,981

Paid-in capital 42,047 38,854

Retained earnings 377,384 353,292

Treasury shares, at cost, 1,592,027 and 1,431,235 shares at

September 30, 2020 and December 31, 2019, respectively (87,320) (79,106)

Accumulated other comprehensive loss (65,549) (57,353)

TOTAL PREFORMED LINE PRODUCTS COMPANY SHAREHOLDERS' EQUITY 279,575 268,535

Noncontrolling interest 3 33

TOTAL SHAREHOLDERS' EQUITY 279,578 268,568

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 452,041 $ 433,571

PREFORMED LINE PRODUCTS COMPANY

STATEMENTS OF CONSOLIDATED OPERATIONS

(In thousands, except per share data) Three Months Ended September 30 Nine Months Ended September 30

2020 2019 2020 2019

Net sales $ 127,463 $ 119,217 $ 347,944 $ 331,212

Cost of products sold 82,549 79,874 230,554 226,798

GROSS PROFIT 44,914 39,343 117,390 104,414

Costs and expenses

Selling 8,884 9,410 26,228 26,868

General and administrative 14,037 13,275 39,903 38,486

Research and engineering 4,541 4,240 12,950 12,809

Other operating expense - net 562 775 1,969 1,447

28,024 27,700 81,050 79,610

OPERATING INCOME 16,890 11,643 36,340 24,804

Other income (expense)

Interest income 36 211 226 613

Interest expense (504) (735) (1,932) (1,688)

Other income - net 998 138 1,775 306

530 (386) 69 (769)

INCOME BEFORE INCOME TAXES 17,420 11,257 36,409 24,035

Income taxes 4,458 3,213 9,306 6,302

NET INCOME $ 12,962 $ 8,044 $ 27,103 $ 17,733

Less: Net income attributable to noncontrolling (8) (93) 30 (54)interests

NET INCOME ATTRIBUTABLE TO PREFORMED LINE PRODUCTS $ 12,954 $ 7,951 $ 27,133 $ 17,679 COMPANY SHAREHOLDERS

BASIC EARNINGS PER SHARE

Net Income Attributable to Preformed Line Products $ 2.63 $ 1.58 $ 5.47 $ 3.51 Company Shareholders

DILUTED EARNINGS PER SHARE

Net Income Attributable to Preformed Line Products $ 2.59 $ 1.55 $ 5.43 $ 3.48 Company Shareholders

Cash dividends declared per share $ 0.20 $ 0.20 $ 0.60 $ 0.60

Weighted-average number of shares outstanding - 4,917 5,024 4,963 5,039basic

Weighted-average number of shares outstanding - 5,011 5,119 4,998 5,077diluted

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SOURCE Preformed Line Products Company