Bel Fuse (BELFB) 16th Annual Midwest Ideas Conference summary

Company Overview and Evolution

• Designs and manufactures electronic components for diverse end markets, with $634 million in pro forma annual sales and 5,000 employees globally.

• Business evolved from TV fuses to supporting networking, military, aerospace, rail, e-mobility, space, and AI.

• Over 16 acquisitions in recent decades have diversified end markets and product groups.

• Geographic sales: nearly 70% North America, with the rest in Asia and Europe.

• Recent leadership transitions include a new CEO and CFO in May 2025, following strategic hires and operational initiatives since 2021.

Segment and Market Performance

• End markets are diversified: 43% industrial, 27% networking, 21% aerospace/defense, with a strong blue-chip customer base including Raytheon, Lockheed Martin, Cisco, DellEMC, Boeing, and John Deere.

• Power segment (50% of business) serves networking, industrial, rail, e-mobility, and AI, with Cisco and Alstom as key customers.

• Connectivity (one-third of business) supplies cabling/connectors for commercial air, military, and agriculture, with Boeing, Lockheed, and John Deere as major clients.

• Magnetics (15%) focuses on integrated connector modules for networking, with Cisco, HP, and Dell as main customers; segment is rebounding after destocking.

• Distribution channel reaches 50,000 end customers annually, acting as a sales seeding mechanism.

Financial Transformation and Margin Improvement

• Gross margin reached 37.8% and adjusted EBITDA margin 20.7% in TTM Q2-25, with adjusted EBITDA of $131 million.

• Net leverage reduced to 0.9x, reflecting disciplined capital management and improved liquidity.

• Initiatives included SKU-level profitability analysis, price adjustments, facility consolidations, ERP implementation, and pay-for-performance.

• Sales have remained flat, but operational improvements have driven profitability.

• Recent Enercon acquisition added debt, which is being actively paid down.