Belden (BDC) Q4 2023 earnings summary

Executive summary

• Q4 revenue and adjusted EPS exceeded guidance; orders rose 4% QoQ. FY adjusted EPS reached a record $6.83, up 7% YoY.

• FY revenue declined 4% to $2,512M; adjusted gross margin rose 270 bps to 38.5% and adjusted EBITDA margin increased 40 bps to 17.4%.

• Solutions-focused transformation supported margin gains amid customer destocking and temporary headwinds.

Financial highlights

• Q4 adjusted revenue was $551.2M, down 16% YoY; adjusted EPS was $1.46, down 17%, adjusted EBITDA was $88.3M, down 23%, and adjusted net income was $61.4M, down 20%.

• Q4 net income was $39M vs. $61M YoY; GAAP EPS was $0.91 vs. $1.40, and adjusted EBITDA was $88M vs. $115M.

• FY adjusted gross profit rose 4% to $966.4M; adjusted EBITDA was $438.1M, down 1%, and adjusted net income rose 3% to $292.8M.

• FY operating cash flow was $319.6M and non-GAAP free cash flow was $217M.

Outlook and guidance

• Q1 2024 guidance: revenue $505M–$520M, GAAP EPS $0.65–$0.75 and adjusted EPS $1.00–$1.10.

• Q1 assumptions include $10.0M interest expense, a 20.0% tax rate and 41.6M shares; customer destocking and temporary headwinds expected to persist, with end demand stable vs. Q4 and revenue lower on seasonality.

• Long-term framework targets $8.00+ adjusted EPS by 2025, ~30% incremental EBITDA margins and ~$1B cumulative free cash flow for 2022–2025.

• Rising data and automation needs cited as durable opportunities, with growth expected as the next investment cycle ramps up.