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PREFORMED LINE PRODUCTS ANNOUNCES SECOND QUARTER 2023 FINANCIAL RESULTS

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CLEVELAND, Aug. 2, 2023 /PRNewswire/ -- Preformed Line Products Company (NASDAQ: PLPC) today reported financial results for its second quarter of 2023.

Q2 2023 Highlights:

  • Net sales growth of 11% compared to Q2 2022, matching quarterly record net sales levels achieved in Q1 2023
  • Gross profit margin of 36.5%, consistent with Q1 2023
  • Diluted EPS of $4.08, an increase of 47% from Q2 2022

Net sales in the second quarter of 2023 were $181.8 million compared to $163.5 million in the second quarter of 2022, an 11% increase. Foreign currency translation reduced second quarter 2023 net sales by $2.5 million.

Net income for the quarter ended June 30, 2023 was $20.5 million, or $4.08 per diluted share, compared to $13.7 million, or $2.77 per diluted share, for the comparable period in 2022. The second quarter of 2023 net income continued to benefit from increased gross profit from incremental sales and selling price increases offsetting the impact of inflation on commodities and freight. Gross profit as a percentage of net sales was 36.5% for the second quarter of 2023, an increase of 420 basis points versus the same quarter in 2022.  Currency translation rates had an unfavorable effect on net income of $0.4 million.

Net sales increased 21% to $363.6 million for the first six months of 2023 compared to $301.7 million for the first six months of 2022.  Currency translation rates reduced net sales by $7.1 million for the six months ended June 30, 2023.

Net income for the six months ended June 30, 2023 was $41.9 million, or $8.35 per diluted share, compared to $26.0 million, or $5.25 per diluted share, for the comparable period in 2022.  YTD June 30, 2023 net income benefited from the 21% YTD increase in net sales with related fixed cost leverage as well as the realization of price increases offsetting the impact of inflation on commodities and freight.  Currency translation rates had an unfavorable effect on net income of $0.6 million.

Rob Ruhlman, Chairman and Chief Executive Officer, said, "We continue to generate strong net sales performance, matching the quarterly net sales record set earlier this year. We also generated strong net income and earnings per share, falling just short of our previous record earnings in Q1 2023. The strong quarterly results were made possible by the PLP-USA, EMEA, and Asia-Pacific regions posting improved net sales and pre-tax earnings versus Q2 2022 while the Americas fell just short of besting their Q2 2022 results. During the first two quarters of 2023, net sales have outpaced orders resulting in a 29% decrease to backlog from the beginning of the year and an improvement in production lead times, which is a positive for PLP and its customers. We will continue to focus on the delivery of high-quality products and timely service that our customers have come to expect from our dedicated workforce."

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 global business conditions and the economy due to factors such as inflation, rising interest rates, labor disruptions, military conflict, political instability, exchange rates and lingering effects of COVID-19, the strength of demand and availability of funding 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, opportunities for business growth through acquisitions and the ability to successfully integrate any acquired businesses, changes in regulations and tax rates, security breaches, litigation and claims 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 2022 Annual Report on Form 10-K filed with the SEC on March 3, 2023 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 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




June 30, 2023



December 31, 2022


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


(Unaudited)





ASSETS







Cash, cash equivalents and restricted cash


$

43,160



$

37,239


Accounts receivable, less allowances of $6,709 ($5,600 in 2022)



144,593




125,261


Inventories, net



148,481




147,458


Prepaid expenses



8,749




13,283


Other current assets



8,440




4,929


TOTAL CURRENT ASSETS



353,423




328,170


Property, plant and equipment, net



200,325




175,011


Goodwill



29,530




28,004


Other intangible assets, net



13,682




14,082


Deferred income taxes



6,415




5,320


Other assets



18,567




17,892


TOTAL ASSETS


$

621,942



$

568,479


LIABILITIES AND SHAREHOLDERS' EQUITY







Trade accounts payable


$

50,033



$

46,839


Notes payable to banks



13,701




18,098


Current portion of long-term debt



6,889




3,018


Accrued compensation and other benefits



25,210




24,356


Accrued expenses and other liabilities



30,937




23,024


TOTAL CURRENT LIABILITIES



126,770




115,335


Long-term debt, less current portion



68,944




68,420


Other noncurrent liabilities and deferred income taxes



27,779




26,100


SHAREHOLDERS' EQUITY







Common shares – $2 par value per share, 15,000,000 shares

authorized, 4,917,501 and 4,917,020 issued and outstanding, at June

30, 2023 and December 31, 2022



13,509




13,351


Common shares issued to rabbi trust, 241,343 and 245,386 shares at

June 30, 2023 and December 31, 2022, respectively



(10,039)




(10,261)


Deferred compensation liability



10,039




10,261


Paid-in capital



56,943




53,646


Retained earnings



500,726




460,930


Treasury shares, at cost, 1,840,552 and 1,758,901 shares at June 30,

2023 and December 31, 2022, respectively



(109,143)




(99,303)


Accumulated other comprehensive loss



(63,586)




(69,987)


TOTAL PREFORMED LINE PRODUCTS COMPANY

SHAREHOLDERS' EQUITY



398,449




358,637


Noncontrolling interest



-




(13)


TOTAL SHAREHOLDERS' EQUITY



398,449




358,624


TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY


$

621,942



$

568,479


 

PREFORMED LINE PRODUCTS COMPANY

STATEMENTS OF CONSOLIDATED INCOME

(UNAUDITED)



Three Months Ended

June 30,



Six Months Ended

June 30,



2023



2022



2023



2022


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









Net sales

$

181,813



$

163,471



$

363,637



$

301,694


Cost of products sold


115,486




110,765




231,026




207,037


GROSS PROFIT


66,327




52,706




132,611




94,657


Costs and expenses












Selling


13,013




11,668




25,401




22,328


General and administrative


18,220




16,948




36,830




33,256


Research and engineering


5,760




5,363




10,953




10,137


Other operating expense, net


1,186




778




2,298




1,536




38,179




34,757




75,482




67,257


OPERATING INCOME


28,148




17,949




57,129




27,400


Other (expense) income












Interest income


419




104




723




216


Interest expense


(1,134)




(784)




(2,199)




(1,310)


Other income, net


108




495




147




5,599




(607)




(185)




(1,329)




4,505


INCOME BEFORE INCOME TAXES


27,541




17,764




55,800




31,905


Income tax expense


7,077




4,043




13,917




5,883


NET INCOME

$

20,464



$

13,721



$

41,883



$

26,022


Net loss (income) attributable to noncontrolling interests


8




(9)




(13)




(25)


NET INCOME ATTRIBUTABLE TO

PREFORMED LINE PRODUCTS COMPANY

SHAREHOLDERS

$

20,472



$

13,712



$

41,870



$

25,997


AVERAGE NUMBER OF SHARES OF COMMON

STOCK OUTSTANDING:












Basic


4,944




4,940




4,940




4,934


Diluted


5,024




4,955




5,013




4,954


EARNINGS PER SHARE OF COMMON STOCK

ATTRIBUTABLE TO PREFORMED LINE

PRODUCTS COMPANY SHAREHOLDERS:












Basic

$

4.14



$

2.78



$

8.48



$

5.27


Diluted

$

4.08



$

2.77



$

8.35



$

5.25














Cash dividends declared per share

$

0.20



$

0.20



$

0.20



$

0.20


 

 

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SOURCE Preformed Line Products

Preformed Line Products Co

NASDAQ:PLPC

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Electrical Equipment & Parts
Water, Sewer, Pipeline, Comm & Power Line Construction
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