Bel Fuse Inc (NASDAQ:BELFB) Q2 2016 Earnings Conference Call - Final Transcript

Jul 27, 2016 • 11:00 am ET

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Bel Fuse Inc (NASDAQ:BELFB) Q2 2016 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day ladies and gentlemen. Welcome to the Bel Fuse Second Quarter Results Conference Call. Today's call is being recorded. [Operator Instructions]

I would now like to turn the conference over to Mr. Daniel Bernstein. Please go ahead, sir.

Executive
Daniel Bernstein

Thank you, Catherine. Joining me today on the call is Colin, our VP of Finance; and Frank, our Manager of Finance. Before we begin, I'd like to ask Colin to go over the Safe Harbor statement. Colin.

Executive
Colin Dunn

Good morning, everybody. Thanks, Dan. Except the historic information contained in this call, the matters discussed on this call including the statements regarding stronger sales for Bel Power Solutions in the second half of 2016 and potential growth in the Commercial Aerospace business. Our forward looking statements is described under the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties.

Actual results could differ materially from Bel's projections. Among the factors that could cause actual results to differ materially from such statements are: the market concerns facing our customers; the continuing viability of sectors that rely on our products; the effects of business and economic conditions; difficulties associated with integrating recently acquired companies; capacity and supply constraints or difficulties; product development, commercialization or technological difficulties; the regulatory and trade environment; risks associated with foreign currencies; uncertainties associated with legal proceedings; the market's acceptance of the company's new products and competitive responses to those new products; and the risk factors detailed from time-to-time in the company's SEC reports.

In light of the risks and uncertainties, there can be no assurance that any forward-looking statement will in fact prove to be correct. We undertake no obligation to update or revise any forward-looking statements. We also may discuss non-GAAP results during this call, and reconciliations of our GAAP results to non GAAP results have been included in our release today.

Moving now to the financials, our second quarter net sales were $131.6 million, down 9.6% as compared with the second quarter of 2015. On a product basis, salse of our magnetic solutions product were $41.5 million in the second quarter of 2016, a decrease of 10.4% as compared with the second quarter of 2015. Sales of our Connectivity Solutions product was $44.9 million in the second quarter of 2016, a decrease of 1.6 percentage compared with the second quarter of 2015.

Sales of our Power Solutions and Protection Products were $45.3 million in the second quarter of 2016, a decrease of 15.8 percentage compared with the second quarter of 2015. On a regional basis, sales in North America decreased $9.2 million or 12% in the second quarter of 2016 as compared with the second quarter of last year. Sales in Europe were flat and sales in Asia decreased $4.9 million or 10.1%. Despite the decline in sales, gross profit margin was relatively flat at 19.5% in the second quarter of 2016 as compared with 19.6% in the second quarter of 2015. This is primarily due to the favorable product mix, the impact of low cost