Littelfuse (LFUS) Q4 2008 earnings summary

Executive summary

• FY08 net sales were $530.9m vs. $536.1m in FY07; operating income fell to $8.5m from $51.3m amid special charges, higher costs and a sharp Q4 demand downturn.

• Q4 sales were $105.9m, with operating loss of $13.1m and net loss of $9.2m; diluted loss per share was $0.42.

Financial highlights

• FY08 gross profit was $143.7m, or 27.1% of sales, vs. $171.5m, or 32.0%, in FY07; operating margin was 1.6% vs. 9.6%.

• Net income was $8.0m vs. $36.8m; diluted EPS was $0.37 vs. $1.64. Income from continuing operations was also $8.0m in FY08.

• Operating cash flow was $40.6m; cash and equivalents ended FY08 at $70.9m, up $6.0m for the year.

Outlook and guidance

• Weak automotive and electronics markets were expected to persist through much of 2009; electrical demand had also slowed, with non-residential construction a potential headwind.

• Manufacturing transfers were expected to generate at least $20m of savings in 2009 and significant additional savings in 2010; a separate plan targeted ~$15m lower operating expenses and ~$8m lower manufacturing costs in 2009.

• FY09 capital expenditures were projected at ~$27m, led by completion of the China wafer fabrication facility; operating cash flow was expected to exceed the spending plan.