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Lincoln International said it has served as the exclusive financial advisor to Meggitt PLC, in the sale of three of its Industrial Sensing businesses to $APH. The divestiture included three Industrial Sensing businesses, Wilcoxon Research, Piezo Technologies, and Piher Sensors and Controls.
$APH stated that there was a particular weaker performance in tablets in 1Q17, which is expected to continue. There seems to be material and systematic consumer shift away from tablets and towards other devices like either bigger handsets or smaller laptops. The prospect of tablets does not seem to be as good as they once were, $APH said.
With regards to the capital allocation, $APH said that it deploys about half of the capital in shareholders return via dividends and share repurchase program. As the continuation of the share repurchase program announced earlier this year, $APH repurchased 3.7MM shares in 1Q17. This varies from quarter to quarter depending on the cash needs.
$APH expects 2Q17 sales in the range of $1.58-1.62Bil and diluted EPS in the range of $0.70-0.72. For FY17, it now expects to achieve sales in the range of $6.405-6.525Bil, and diluted EPS of $2.91-2.97. This compares to prior FY17 guidance of $6.34-6.50Bil in sales and diluted EPS of $2.84-2.92.
$APH, which makes electronic and fiber optic connectors, posted 8% growth in net revenue to $1.56Bil in 1Q17. Net income was up to $225MM, or $0.71 per share, from $456.6MM, or $0.50 per share in the year-ago period. On an adjusted basis also, net income was $0.71 per share during the quarter.
$APH received notice of an unsolicited "mini-tender" offer by TRC Capital Corp. to buy up to 2MM shares of $APH's common stock at a price of $68.25 per share in cash. $APH does not endorse TRC Capital’s unsolicited mini-tender offer and recommends that stockholders reject the offer of TRC Capital and not tender their shares.
The mobile networks market represented 9% of $APH’s sales in 4Q16 and 9% for 2016. Sales grew from 4Q15 by 29% in US dollars and 10% organically. For 2016, $APH achieved strong growth of 24% in US dollars and 9% organically. For full-year 2017, the company expects sales to remain roughly at 2016 levels.
The commercial aerospace market represented 4% of $APH’s sales in 4Q16 and 5% for 2016. Sales in 4Q16 were down from the prior year by 5% in US dollars and 3% in local currencies as procurement and support of certain new airplane platforms did moderate from prior year. For 2017, $APH expects sales to increase mid to high single digits.
The military market represented 10% of $APH’s sales in 4Q16 and 9% of sales in 2016. Sales were up strongly in 4Q16, rising by 14% in US dollars and 15% organically. Military sales in 2016 grew by 4% both in US dollars and organically. The company expects to achieve low to mid single digit sales growth for full year 2017.
In 4Q16, $APH’s Cable business, which comprises 6% of sales, was up 18% from 4Q15, with organic growth as well as the impact of acquisitions. The Interconnect business, which comprises 94% of sales, was up 15% from last year with organic growth as well as the impact of FCI as well as other acquisitions.
In 4Q16, $APH’s sales were up 15% in US dollars and 17% in local currencies compared to 4Q15. From an organic standpoint and excluding both acquisitions and currency, sales in 4Q16 increased 4%. Sequentially, sales were up 1% in US dollars and organically and 2% in local currency.
In addition to acquisition program, $APH continues to deploy its financial strength in a variety of ways to lift shareholder value. This includes purchase, during 4Q16, of 1.5MM shares, completing those authorized under 2015 program. On Jan. 24, $APH's BoD authorized a new 2-year stock repurchase plan for purchase of up to $1Bil of common stock.
$APH expects 1Q17 sales of $1.495-1.535Bil and EPS of $0.65-0.67, considering uncertain economic environment and based on current currency exchange rates. For FY17, $APH sees sales of $6.34-6.5Bil, a 1-3% rise over 2016, and EPS of $2.84-2.92, an increase of 9-12% over 2016 GAAP EPS and a 4-7% rise over 2016 adjusted EPS.
$APH reported a rise in 4Q16 earnings as organic growth in all markets, except mobile devices and commercial aerospace, and contribution from its acquisition program drove sales higher. Net income rose to $235.4MM or $0.75 per share from $200.1MM or $0.63 per share last year. Net sales grew to $1.65Bil from $1.43Bil.
$APH's cable business, which comprises 6% percent of its sales, was up 14% in 3Q16, helped by the broadband market strength. The interconnect business, which comprises 94% of our sales, was up 12% in 3Q16, helped by the impact of the FTI acquisition as well as organic growth.