Bel Fuse Inc. announced preliminary unaudited financial results for the second quarter and first six months of 2009. Net sales for the three months ended June 30, 2009 decreased to $44,934,000 compared to $72,454,000 for the second quarter of 2008. The net loss for the second quarter of 2009 was $1,272,000. This compares to net earnings for the second quarter of 2008 of $1,811,000.
The $2.9 million loss from operations for the second quarter of 2009 was affected by $1.6 million ($1.0 million or $0.08 per share after tax) in severance and other one-time charges. Labor inefficiencies and moving expenses for the consolidation of Bel’s South China manufacturing operations also affected the company’s second quarter performance. These costs were partially offset by a GAAP net gain of $1.1 million ($0.7 million or $0.06 per share after tax) on the sale of a portion of the company’s equity interest in Power-One, Inc., which reduced Bel’s ownership to 4.9%. This gain represents the difference between the sales price of the Power-One shares and the written down value at December 31, 2008 (based on original cost, the company actually incurred a loss on the sale of Power-One shares in the amount of $1.2 million ($0.8 million or $0.06 per share after tax).
The net loss per Class A common share was $0.11 for the second quarter of 2009, compared to diluted earnings per Class A common share of $0.14 for the second quarter of 2008. The net loss per Class B common share was $0.11 for the second quarter of 2009, compared to diluted earnings per Class B common share of $0.16 for last year’s second quarter.
"Conditions in our industry remain challenging. Sales volumes were down across all of our product lines compared to the second quarter last year. We are encouraged that second quarter sales increased sequentially, compared to the recent first quarter of 2009, and although we believe that the previous first quarter reflects the bottoming of industry demand, our visibility and our customers’ visibility remains limited. Cash flows from operations, including accounts receivable and inventory, generated more than $5,000,000 in cash during the second quarter, and more than $20,000,000 for the year’s first half. With our increasingly efficient operating platform, strong financial position, and close customer relationships, we are well-positioned to benefit when demand rebounds," said Daniel Bernstein, Bel’s President and CEO.
At June 30, 2009, Bel reported working capital of approximately $164,500,000, including cash, cash equivalents, short-term investments and marketable securities of approximately $114,800,000, a current ratio of 8.3, total long-term obligations of $10,408,000, and stockholders’ equity of $218,192,000. At December 31, 2008, Bel reported working capital of approximately $164,000,000, including cash, cash equivalents, short-term investments and marketable securities of approximately $92,700,000, a current ratio of 6.5, total long-term obligations of $14,377,000, and stockholders’ equity of $217,773,000. Bel did not repurchase any Class A common shares during the second quarter of 2009.
