Rogers Corporation (NYSE:ROG) Q4 2019 Earnings Conference Call - Final Transcript

Feb 20, 2020 • 05:00 pm ET


Rogers Corporation (NYSE:ROG) Q4 2019 Earnings Conference Call - Final Transcript


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Good day. My name is Erica and I will be your conference operator today. At this time, I would like to welcome everyone to the Rogers Corporation Fourth Quarter 2019 and Full Year Earnings Call. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]

I will now turn the call over to your host, Mr. Steve Haymore, Director of Investor Relations. Sir, you may begin your conference.

Stephen Haymore

Thank you. Good afternoon, everyone, and welcome to the Rogers Corporation fourth quarter 2019 earnings conference call. The slides for today's call can be found on the Investors section of our website, along with the news release that was issued today. Please turn to slide two. Before we begin, I would like to note that statements in this conference call that are not strictly historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and should be considered as subject to many uncertainties that exist in Rogers' operations and environment. These uncertainties include economic conditions, market demands and competitive factors. Such factors could cause actual results to differ materially from those in any forward-looking statement.

Also, the discussions during this conference call may include certain financial measures that were not prepared in accordance with generally accepted accounting principles. Reconciliation of those non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the slide deck for today's call, which is posted on the Investors section of our website. Turning to slide three, with me today is Bruce Hoechner, President and CEO; Mike Ludwig, Senior Vice President and CFO; and Bob Daigle, Senior Vice President and CTO.

I will now turn the call over to Bruce.

Bruce D. Hoechner

Thanks, Steve. Good afternoon everyone and thank you for joining us today. 2019 was in many ways a tale of two halves for Rogers. In the first half of the year, our strategic positioning enabled us to take advantage of strong market growth and achieve consecutive quarters of record sales. In the second half of the year, changing macroeconomic conditions, trade tensions and a pause in the wireless infrastructure market combined to temper full year results. Even with these headwinds, we have reported modest growth in revenue and earnings in 2019. Net sales for the year were $898 million and adjusted EPS was $6.14. In addition, we delivered record cash from operations of $161 million and strong free cash flow of $110 million for the year. As mentioned, challenging market condition impacted the second half of 2019 and specifically Q4. For the fourth quarter, net sales were $194 million and below our guidance range, primarily due to a greater than anticipated pause in the 5G build out and lower 4G demand. This decline was partially offset by stronger sales of power semiconductor substrates for the EV/HEV market and aerospace and defense demand. Q4 adjusted EPS was $1.14, which was near the high-end of our guidance range.

I will take a moment here to briefly discuss the