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CLEVELAND, May 5, 2022 /PRNewswire/ -- Preformed Line Products Company (NASDAQ: PLPC) today reported financial results for its first quarter ended March 31, 2022.
Q1 2022 Highlights:
Net sales for the first quarter of 2022 were $138.2 million, an increase of 18%, compared to $117.6 million in the first quarter of 2021. Currency translation rates had an unfavorable impact on 2022 first quarter net sales of $2.5 million, or 2%.
The Company posted net income for the first quarter of 2022 of $12.3 million, or $2.49 per diluted share, compared to $7.2 million, or $1.45 per diluted share, in the first quarter of 2021. First quarter 2022 net income included a non-taxable gain of $4.4 million from life insurance death benefits. The first quarter of 2022 also included charges of approximately $1.0 million related to the wind-down of the Company's subsidiary in Russia, which include a $0.4 million charge to write-down inventory balances. Currency translation rates had an unfavorable effect on net income of $0.2 million.
Rob Ruhlman, Chairman and Chief Executive Officer, said, "We are pleased with our strong start to 2022. We enjoyed strong volume growth and incremental sales from our newest acquisitions and benefitted from selling price adjustments made necessary by the significant levels of inflation experienced last year and so far this year. The pace of inflationary increases on our raw material inputs and freight expense coupled with additional costs associated with supply chain disruption continue to negatively impact our gross profit percentage and earnings generation. As a result, we have instituted additional selling price increases. All regions except for Asia-Pacific reported an increase in net sales versus Q1 2021. PLP USA continues to lead the increase driven by growth in the communications product family as well as the significance of our U.S. based manufacturing and distribution facilities. Additional investments are well underway within our PLP USA operations to support this growth both today and into the future. While we have seen reductions in revenue in certain operations that rely more heavily on government-sponsored infrastructure projects that have been delayed due to COVID-19, our strength in other markets has more than offset the shortfalls to allow for both top-line and bottom-line growth. Customer satisfaction remains our primary goal – accomplished by providing high-quality products and services that meet or exceed expectations."
FORWARD-LOOKING STATEMENTS
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, the impact of global economic conditions (such as social unrest, acts of war, military conflict (including the ongoing conflict between Russia and Ukraine), international hostilities, terrorism and changes in diplomatic and trade relationships) on profitability and future growth opportunities; the Company's ability to identify, complete, obtain funding for and integrate acquisitions for profitable growth; 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 2021 Annual Report on Form 10-K filed with the SEC on March 4, 2022 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.
ABOUT PLP
PLP protects the world's most critical connections by creating stronger and more reliable networks. The company's precision-engineered solutions are trusted by energy and communications providers worldwide to perform better and last longer. With locations in over 20 countries, PLP works as a united global corporation, delivering high-quality products and unparalleled service to customers around the world.
PREFORMED LINE PRODUCTS COMPANY | ||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||
March 31, | December 31, | |||||||||
(Thousands of dollars, except share and per share data) | 2022 | 2021 | ||||||||
ASSETS | ||||||||||
Cash and cash equivalents | $ 34,630 | $ 36,406 | ||||||||
Accounts receivable, less allowances of $4,541 ($3,744 in 2021) | 115,764 | 98,203 | ||||||||
Inventories – net | 126,113 | 114,507 | ||||||||
Prepaid expenses | 19,111 | 19,778 | ||||||||
Other current assets | 3,458 | 3,217 | ||||||||
TOTAL CURRENT ASSETS | 299,076 | 272,111 | ||||||||
Property, plant and equipment – net | 156,434 | 149,774 | ||||||||
Goodwill | 38,435 | 28,194 | ||||||||
Other intangible assets – net | 16,669 | 12,039 | ||||||||
Deferred income taxes | 5,645 | 3,839 | ||||||||
Other assets | 18,241 | 23,061 | ||||||||
TOTAL ASSETS | $ 534,500 | $ 489,018 | ||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||
Trade accounts payable | $ 51,499 | $ 42,376 | ||||||||
Notes payable to banks | 14,236 | 16,423 | ||||||||
Current portion of long-term debt | 3,261 | 3,116 | ||||||||
Accrued compensation and other benefits | 20,415 | 21,703 | ||||||||
Accrued expenses and other liabilities | 26,086 | 21,917 | ||||||||
TOTAL CURRENT LIABILITIES | 115,497 | 105,535 | ||||||||
Long-term debt, less current portion | 60,594 | 40,048 | ||||||||
Other noncurrent liabilities and deferred income taxes | 29,500 | 27,335 | ||||||||
SHAREHOLDERS' EQUITY | ||||||||||
Shareholders' equity: | ||||||||||
Common shares - $2 par value, 15,000,000 shares authorized, 4,940,094 and | ||||||||||
4,907,143 issued and outstanding, as of March 31, 2022 and December 31, 2021, respectively | 13,302 | 13,185 | ||||||||
Common shares issued to rabbi trust, 244,485 and 243,138 shares at | ||||||||||
March 31, 2022 and December 31, 2021, respectively | (10,201) | (10,102) | ||||||||
Deferred compensation liability | 10,201 | 10,102 | ||||||||
Paid-in capital | 48,847 | 47,814 | ||||||||
Retained earnings | 421,921 | 410,673 | ||||||||
Treasury shares, at cost, 1,788,283 and 1,685,387 shares at | ||||||||||
March 31, 2022 and December 31, 2021, respectively | (95,631) | (93,836) | ||||||||
Accumulated other comprehensive loss | (59,529) | (61,719) | ||||||||
TOTAL PREFORMED LINE PRODUCTS COMPANY SHAREHOLDERS' EQUITY | 328,910 | 316,117 | ||||||||
Noncontrolling interest | (1) | (17) | ||||||||
TOTAL SHAREHOLDERS' EQUITY | 328,909 | 316,100 | ||||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 534,500 | $ 489,018 | ||||||||
PREFORMED LINE PRODUCTS COMPANY | ||||||
STATEMENTS OF CONSOLIDATED OPERATIONS | ||||||
(Thousands of dollars, except per share data) | Three Months Ended March 31 | |||||
2022 | 2021 | |||||
Net sales | $ 138,223 | $ 117,553 | ||||
Cost of products sold | 96,272 | 77,361 | ||||
GROSS PROFIT | 41,951 | 40,192 | ||||
Costs and expenses | ||||||
Selling | 10,661 | 9,601 | ||||
General and administrative | 16,309 | 14,394 | ||||
Research and engineering | 4,774 | 4,611 | ||||
Other operating expense – net | 756 | 818 | ||||
32,500 | 29,424 | |||||
OPERATING INCOME | 9,451 | 10,768 | ||||
Other income (expense) | ||||||
Interest income | 113 | 21 | ||||
Interest expense | (526) | (463) | ||||
Other income – net | 5,103 | 228 | ||||
4,690 | (214) | |||||
INCOME BEFORE INCOME TAXES | 14,141 | 10,554 | ||||
Income tax expense | 1,840 | 3,377 | ||||
NET INCOME | $ 12,301 | $ 7,177 | ||||
Less: Net (gain) loss attributable to noncontrolling interests | (16) | 2 | ||||
NET INCOME ATTRIBUTABLE TO PREFORMED | ||||||
LINE PRODUCTS COMPANY SHAREHOLDERS | $ 12,285 | $ 7,179 | ||||
AVERAGE NUMBER OF SHARES OF COMMON STOCK | ||||||
OUTSTANDING: | ||||||
Basic | 4,928 | 4,917 | ||||
Diluted | 4,943 | 4,936 | ||||
EARNINGS PER SHARE OF COMMON STOCK | ||||||
ATTRIBUTABLE TO PREFORMED LINE PRODUCTS | ||||||
COMPANY SHAREHOLDERS: | ||||||
Basic | $ 2.49 | $ 1.46 | ||||
Diluted | $ 2.49 | $ 1.45 | ||||
Cash dividends declared per share | $ 0.20 | $ 0.20 | ||||
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SOURCE Preformed Line Products
