<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report: October 26, 1999
(Date of earliest event reported)
THOMAS & BETTS CORPORATION
(Exact name of registrant as specified in its charter)
Tennessee 1-4682
(State or Other Jurisdiction (Commission File Number)
of Incorporation)
22-1326940
(IRS Employer Identification No.)
8155 T&B Boulevard
Memphis, Tennessee 38125
(Address of Principal (ZIP Code)
Executive Offices)
Registrant's Telephone Number, Including Area Code:
(901) 252-8000
<PAGE>
ITEM 5. OTHER EVENTS
On October 26, 1999, Thomas & Betts Corporation (the "Registrant")
announced, by the press release attached as Exhibit 20 to this report, and
incorporated herein by reference, its financial results for the fiscal
quarter ended October 3, 1999.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
20 Press Release of the Registrant dated October 26, 1999.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Thomas & Betts Corporation
(Registrant)
By: /s/ Jerry Kronenberg
-------------------------
Jerry Kronenberg
Title: Vice President-General Counsel
and Secretary
Date: October 26, 1999
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION OF EXHIBITS
------- -----------------------
<S> <C>
20 Press Release of the Registrant dated October 26, 1999.
</TABLE>
<PAGE>
NEWS [THOMAS AND BETTS LETTERHEAD]
Contact:
Renee Johansen:
(901) 252-5962
FOR IMMEDIATE RELEASE
Thomas & Betts Third-Quarter Earnings Up 21%
MEMPHIS, Tenn.--October 26, 1999 - Thomas & Betts Corporation (NYSE: TNB)
today said that, excluding several one-time items and other charges,
third-quarter 1999 net earnings were $47.8 million, or $0.82 per diluted
share. Those results compare with 1998's third-quarter net earnings before
special charges of $39.6 million, or $0.70 per share. Excluding one-time
items and charges from results of both periods, 1999's results topped those
of the prior-year quarter by 20.7%. Including one-time items and other
charges, Thomas & Betts reported third-quarter 1999 net earnings of $47.3
million, $0.82 per share. In comparison, Thomas & Betts posted a net loss of
$37.5 million, or $0.66 per share, after special charges for 1998's third
quarter.
Several one-time items and other charges lowered 1999's
third-quarter net earnings by $0.4 million. Events giving rise to those
charges resulted from balance sheet adjustments, primarily for changes to tax
reserves and asset valuations; merger and acquisition activity; and inventory
write-downs in the company's TDI battery operations. In 1998's third quarter
Thomas & Betts recorded pretax special charges of $108.5 million related to
an aggressive cost reduction program that decreased net earnings $77.0
million, or $1.35 per share.
OPERATING RESULTS
Third-quarter net sales before adjustments grew 22.9% to $663.4 million from
1998's $539.8 million. In addition to improvement from the late-1998 Kaufel
acquisition, higher core sales in the company's Electronic OEM segment
contributed to the sales increase. Sales before acquisitions rose 10.0% year
over year.
Through nine months, consolidated sales were $1,910.4 million, 16.7% above
1998's level for the same period. Net earnings through nine months of 1999
including one-time items and other charges were $129.2 million versus $41.4
million in the same period of 1998, and diluted EPS were $2.23 compared with
1998's $0.73.
1
<PAGE>
SEGMENT RESULTS
The following discussion compares 1999 segment results before allocation of
one-time items and other charges to prior-year results before allocation of
special charges to allow for comparison of underlying operating trends.
Sales of the Electrical segment grew 29.4% to $349.6 million for the
quarter, and segment earnings rose 22.0% to $54.0 million. Sales from
acquisitions, together with improved demand from industrial end-users, accounted
for the segment's increase. Through nine months, sales increased 29.7% to
$1,045.6 million and segment earnings were 12.5% higher.
The Electronic OEM segment showed significant improvement year over year in
the third quarter with segment earnings increasing 49.5% to $19.4 million and
sales growing 19.3% to $179.9 million. Strong sales of battery packs to cellular
handset OEMs and components to computer manufacturers led the year-over-year
increase. On a year-to-date basis, the Electronic OEM segment had sales of
$506.9 million, up 5.7% from 1998's first nine months, and segment earnings
climbed 17.9% from 1998's level.
Sales of the Communications segment were $83.8 million, or 31.5% above
same-quarter 1998 sales. Heavy sales of amplifier product lines in advance of
the divestitures of those businesses and solid demand for passive cable
television components boosted sales in the quarter. Segment earnings were $5.9
million, 54.6% higher than 1998's levels. Through nine months of 1999,
Communications sales were $214.8 million, 6.8% above the same period of 1998,
and earnings were $7.5 million.
Other sales in the third quarter were $50.1 million, a decrease of 9.2% from
1998's third-quarter level. Earnings on those sales increased 7.2% to $6.8
million in the face of the lower revenue level due to manufacturing efficiencies
and lower sales expenses in the heating business. Through nine months of 1999,
other sales totaled $160.7 million, 6.6% greater than the same 1998 period, and
earnings increased 51.5% from the prior year.
"We completed a number of strategic actions during the third quarter," said
Clyde R. Moore, president and chief executive officer. "As already mentioned, we
completed implementation of a number of new information systems and
restructuring of our accounting and control organization to mirror our overall
organization structure. We refocused our cable television offering with the sale
of all amplifier and broadband active-component product lines. We furthered our
extensive electrical product offering to the commercial construction market with
the acquisitions of L.E. Mason and Shamrock Conduit Products. And we continued
to experience great market acceptance of our MPI electronic interconnect line."
Moore added, "We expect to deliver results for 1999 within the current range
of analysts' expectations."
2
<PAGE>
RESULTS BY REGION
On a geographic basis, the company recorded significantly higher year-
over-year sales in Canada due to strong demand for its electrical package and
professional electronics products as well as economic resurgence of the
oil-producing region of that country. Sales to Latin American customers
continued their sharp upward trend as a result of the company's expanded sales
and marketing presence in that region. Sales in Europe increased from the
prior-year quarter due to strong demand for newer products from electronic OEMs
and an electrical acquisition. Thomas & Betts again increased sales to the
Asia/Pacific region over both the third quarter of 1999 and the second quarter
of 1999, reflecting recovery of the region's economies.
THIRD-QUARTER 1999 ONE-TIME ITEMS AND OTHER CHARGES
During the third quarter of 1999 the company reduced balance sheet tax
reserves as a result of approval of substantial tax-refund claims filed for
previous years and favorable completion of several tax exams during the quarter.
Also, as previously announced, the planned merger with AFC Cable Systems (AFC)
was terminated during the quarter by AFC upon its acceptance of a higher offer.
As a result, Thomas & Betts received a $16 million termination fee. Partially
offsetting that termination fee were merger and acquisition expenses and a net
loss on the third-quarter dispositions of three cable-television amplifier
product lines.
A number of other adjustments were made during the quarter as a result of a
comprehensive balance sheet review following implementation of several major
information technology system conversions and a restructuring of the company's
control organization. Thomas & Betts' management is evaluating whether a portion
of those adjustments, in addition to an inventory valuation adjustment for the
battery operations following a physical inventory count, should be attributed to
prior periods. The adjustments other than for the battery operations relate to
such items as (1) billing errors associated with new systems' implementations,
(2) increases and decreases in various reserve balances as a result of improved
data-analysis capabilities with the new systems, and (3) increased provisions
for inventory losses related to discontinued products. If management determines,
and its independent auditors and board of directors' audit committee concur,
that certain costs should be assigned to earlier quarters of 1999, first-quarter
and second-quarter 1999 net earnings could decrease and third-quarter net
earnings could correspondingly increase. Therefore, management believes that
full-year 1999 net earnings should not be affected by any restatement of
quarterly results. To the extent that any of these costs are attributed to prior
years, 1999 net earnings could increase.
3
<PAGE>
Thomas & Betts is a leading producer of connectors and components for
worldwide electrical and electronic markets. Visit Thomas & Betts on the World
Wide Web at www.tnb.com.
Forward-looking statements in this news release are subject to many
uncertainties in the company's operations and business environments. Such
uncertainties, which are discussed further in the company's quarterly filings
with the Securities and Exchange Commission, may cause the actual results of the
company to be materially different from any future results expressed or implied
by such forward-looking statements.
# # #
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<PAGE>
THOMAS & BETTS CORPORATION
Consolidated Balance Sheet
(In thousands)
<TABLE>
<CAPTION>
Oct 3, 1999 Jan 3, 1999
------------ -------------
Assets
<S> <C> <C>
Cash and marketable securities $ 85,740 $ 106,506
Receivables - net 482,663 404,784
Inventories 485,851 469,641
Deferred income taxes 59,903 61,829
Prepaid expenses 29,558 15,642
---------- ----------
Total current assets 1,143,715 1,058,402
---------- ----------
Property, plant and equipment - net 667,760 631,022
Intangible assets - net 619,728 621,487
Investments in unconsolidated
companies 155,840 142,251
Other assets 60,818 46,425
---------- ----------
Total assets $2,647,861 $2,499,587
---------- ----------
---------- ----------
Liabilities and Shareholders' Equity
Notes payable and current
maturities of long-term debt $ 80,033 $ 97,657
Accounts payable 317,206 262,483
Accrued liabilities 160,570 155,815
Income taxes 20,076 55,674
Dividends payable 16,169 15,920
---------- ----------
Total current liabilities 594,054 587,549
---------- ----------
Long-term debt 837,103 790,963
Other long-term liabilities 101,383 93,788
Deferred income taxes 22,422 12,182
Shareholders' equity 1,092,899 1,015,105
---------- ----------
Total Liabilities and Shareholders'
Equity $2,647,861 $2,499,587
---------- ----------
---------- ----------
</TABLE>
5
<PAGE>
THOMAS & BETTS CORPORATION
Consolidated Statement of Earnings
(In thousands except per share amounts)
<TABLE>
<CAPTION>
Quarter Ended Nine Months Ended
----------------- ------------------
Oct 3, Oct 4, Oct 3, Oct 4,
1999 1998 1999 1998
-------- -------- ---------- ----------
<S> <C> <C> <C> <C>
Net Sales $645,964 $539,797 $1,910,422 $1,637,475
Costs and expenses:
Cost of sales 496,116 410,186 1,389,585 1,178,459
Marketing, general and
administrative 111,557 99,939 321,168 267,992
Research and development 11,923 11,810 36,908 37,621
Amortization of intangibles 4,313 4,114 13,618 12,606
Provisions for
restructured operations - 62,096 - 62,096
-------- -------- ---------- ----------
Total operating expenses 623,909 588,145 1,761,279 1,558,774
Operating income (loss) 22,055 (48,348) 149,143 78,701
Income from
unconsolidated companies 7,141 5,243 23,857 19,895
Other expense-net 7,611 9,590 39,201 38,654
-------- -------- ---------- ----------
Earnings (loss) before income
taxes 21,585 (52,695) 133,799 59,942
Income taxes (25,748) (15,227) 4,609 18,564
-------- -------- ---------- ----------
Net Earnings (loss) $47,333 $(37,468) $129,190 $41,378
-------- -------- ---------- ----------
-------- -------- ---------- ----------
Net earnings (loss) per share:
Basic $0.82 ($0.66) $2.24 $0.73
Diluted $0.82 ($0.66) $2.23 $0.73
Average shares outstanding:
Basic 57,718 56,732 57,651 56,650
Diluted 58,017 56,896 57,891 57,006
Cash dividend per share $0.28 $0.28 $0.84 $0.84
</TABLE>
Certain prior-year amounts have been reclassified to conform to current-
year presentation.
6
<PAGE>
THOMAS & BETTS CORPORATION
(In thousands except per share amounts)
Comparison of Results before Charges and One-time Items
<TABLE>
<CAPTION>
Quarter Ended
------------------------
Oct 3,1999 Oct 4,1998
---------- -----------
<S> <C> <C>
Net Sales $663,437 $539,797
Costs and expenses:
Cost of sales 468,482 379,843
Marketing, general and administrative 99,725 83,891
Research and development 11,923 11,810
Amortization of intangibles 4,313 4,114
------- --------
Total operating expenses 584,443 479,658
Operating income 78,994 60,139
Income from unconsolidated
companies 7,141 5,243
Other expense-net 18,715 9,590
------- --------
Earnings before income taxes 67,420 55,792
Income taxes 19,662 16,234
-------- --------
Net Earnings $47,758 $39,558
-------- --------
-------- --------
Net earnings per share:
Basic $0.83 $0.70
Diluted $0.82 $0.70
Average shares outstanding:
Basic 57,718 56,732
Diluted 58,017 56,896
</TABLE>
7
<PAGE>
THOMAS & BETTS CORPORATION
Business Segment Performance
(In thousands)
<TABLE>
<CAPTION>
Quarter Ended Oct 3, 1999* Oct 4, 1998 Change
------------- ----------- ----------
<S> <C> <C> <C>
Net Sales
Electrical $349,625 $270,120 29.4%
Electronic OEM 179,901 150,763 19.3%
Communications 83,786 63,733 31.5%
All Other 50,125 55,181 (9.2%)
------------- -----------
Total $663,437 $539,797 22.9%
------------- -----------
------------- -----------
Segment Earnings
Electrical $ 53,982 $ 44,250 22.0%
Electronic OEM 19,406 12,981 49.5%
Communications 5,856 3,788 54.6%
All Other 6,828 6,372 7.2%
------------- -----------
Total $ 86,072 $ 67,391 27.7%
------------- -----------
------------- -----------
Nine Months Ended Oct 3, 1999* Oct 4, 1998 Change
------------- ----------- ---------
Net Sales
Electrical $1,045,550 $ 806,053 29.7%
Electronic OEM 506,888 479,600 5.7%
Communications 214,771 201,077 6.8%
All Other 160,686 150,745 6.6%
------------- -----------
Total $1,927,895 $1,637,475 17.7%
------------- -----------
------------- -----------
Segment Earnings
Electrical $155,117 $ 137,873 12.5%
Electronic OEM 48,603 41,214 17.9%
Communications 7,519 14,883 (49.5%)
All Other 19,125 12,625 51.5%
------------- -----------
Total $230,364 $ 206,595 11.5%
------------- -----------
------------- -----------
</TABLE>
*Excluding one-time items and other charges and restated for the acquisition of
L.E. Mason, which was accounted for as an immaterial pooling of interests.
8
