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Teleflex Completes Sale of Airfoil Technologies International Singapore Pte. Ltd. to General Electric Company
Dépèche transmise le 23 mars 2009 par Business Wire
Teleflex Completes Sale of Airfoil Technologies International Singapore Pte. Ltd. to General Electric Company
LIMERICK, Pa.--(BUSINESS WIRE)--Teleflex Incorporated (“Teleflex”) has completed the previously announced sale of its 51 percent share of Airfoil Technologies International - Singapore Pte. Ltd., a joint venture between General Electric Company (“GE”) and Teleflex, to GE.
The divested business was part of the Teleflex Aerospace Segment and had annual revenues of approximately $250 million comprised of both repair and replacement component revenues. The cash transaction was valued at $300 million and is expected to result in an after tax gain on sale of approximately $195 million or $4.89 per diluted share. Approximately $190 million of after tax proceeds are expected to be used to repay currently outstanding borrowings.
As a result of ATI being reclassified to discontinued operations and the current outlook for the continuing businesses, the Company anticipates diluted earnings per share from continuing operations for the full year 2009 before special charges to be in the range of $3.25 to $3.55 per diluted share. Special charges for the year are expected to be in the range of $0.30 to $0.40 per diluted share. The previously provided guidance for cash flow from continuing operations is expected to be reduced by approximately $70 million to a range of $210 million to $220 million as a result of the ATI sale. The estimated impact of the divestiture on 2009 free cash flow¹ is a reduction of approximately $30 million including the elimination of minority interest dividends to GE.
“In light of the economy we expect challenges to the initial revenue growth targets that we set for the year, however we are implementing cost containment measures expected to offset the bottom line impact,” stated Jeffrey P. Black, chairman and chief executive officer.
Said Black, “The completion of this transaction allows us to further reduce our outstanding debt and provides additional financial flexibility to support future growth. We greatly appreciate the contributions that the ATI employees have made to Teleflex over the years and are pleased to transition the businesses to GE, a well respected industry leader.”
“I am also pleased to announce that John Suddarth, President of the Aerospace segment since 2004, will also assume management responsibility of the Commercial segment, as its President,” commented Black.
Simpson Thacher & Bartlett LLP acted as legal advisor to Teleflex on this transaction.
About Teleflex Incorporated
Teleflex (NYSE:TFX) is a diversified company that designs, manufactures and distributes quality engineered products and services for the medical, aerospace and commercial markets worldwide. Teleflex employs approximately 13,700 people worldwide who focus on providing innovative solutions for customers. Additional information about Teleflex can be obtained from the company's website at www.teleflex.com.
About GE Aviation
GE Aviation, an operating unit of General Electric Company (NYSE:GE), is a world-leading provider of commercial and military jet engines and components as well as integrated digital, electric power, and mechanical systems for aircraft. GE Aviation also has a global service network to support these offerings. For more information, visit us at www.ge.com/aviation.
Additional Notes
Filed with this press release are schedules which reconcile previously reported 2008 Segment Results of Operations to reflect Discontinued Operations, and Income from Continuing Operations and Diluted Earnings Per Share to reflect Discontinued Operations.
Forward-looking information
This press release contains forward-looking statements, including, but not limited to, statements relating to the expected gain on sale, net of tax, for the ATI transaction; our expected use of the proceeds from the ATI transaction; 2009 forecast of diluted earnings per share from continuing operations before special charges; the expected range of special charges for 2009; the expected impact of the ATI transaction on the range of cash flow from continuing operations expected for 2009; the expected impact of the divestiture on free cash flow; and expected challenges to initial revenue growth targets for 2009. Actual results could differ materially from those in the forward-looking statements due to, among other things, conditions in the end markets we serve, customer reaction to new products and programs, our ability to achieve sales growth, price increases or cost reductions; our ability to realize efficiencies; changes in material costs and surcharges; unanticipated difficulties in connection with consolidation of manufacturing and administrative functions; unanticipated difficulties, expenditures and delays in connection with the integration of Arrow International, including delays in the implementation of integration programs and adverse customer and shareholder reaction; unanticipated difficulties, expenditures and delays in complying with government regulations applicable to our businesses, including unanticipated costs and difficulties in connection with the resolution of issues related to the FDA corporate warning letter issued to Arrow; our ability to meet our debt obligations; changes in general and international economic conditions; and other factors described in Teleflex's filings with the Securities and Exchange Commission, including our Annual Report on Form 10K.
¹ Free cash flow is defined as Cash Flow from Continuing Operations less capital expenditures and dividends paid.
| TELEFLEX INCORPORATED AND SUBSIDIARIES | ||||||||||
| Full Year 2009 Adjusted Diluted Earnings Per Share Guidance | ||||||||||
| To Reflect Discontinued Operations | ||||||||||
| Low | High | |||||||||
|
Previous 2009 earnings per share from continuing operations before special charges guidance |
$4.10 | $4.40 | ||||||||
|
Less: impact of ATI divestiture, net of reduced interest expense |
($0.85) | ($0.85) | ||||||||
|
Revised 2009 earnings per share from continuing operations before special charges guidance |
$3.25 | $3.55 | ||||||||
| TELEFLEX INCORPORATED AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||
| Adjusted Segment Results of Operations | |||||||||||||||||||||||||||||||||||
| To Reflect Discontinued Operations | |||||||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||||||
| 2008 Quarters | 2008 Year to Date | ||||||||||||||||||||||||||||||||||
| 3/30 | 6/29 | 9/28 | 12/31 |
6 MTHS
6/29 |
9 MTHS
9/28 |
12 MTHS
12/31 |
|||||||||||||||||||||||||||||
| (Dollars and shares in thousands, except per share) | |||||||||||||||||||||||||||||||||||
| Medical | $ | 374,057 | $ | 384,335 | $ | 367,327 | $ | 373,390 | $ | 758,392 | $ | 1,125,719 | $ | 1,499,109 | |||||||||||||||||||||
| Aerospace | 66,288 | 65,733 | 62,105 | 59,692 | 132,021 | 194,126 | 253,818 | ||||||||||||||||||||||||||||
| Commercial | 101,765 | 109,610 | 101,628 | 97,591 | 211,375 | 313,003 | 410,594 | ||||||||||||||||||||||||||||
| Net revenues | $ | 542,110 | $ | 559,678 | $ | 531,060 | $ | 530,673 | $ | 1,101,788 | $ | 1,632,848 | $ | 2,163,521 | |||||||||||||||||||||
| Medical | $ | 70,912 | $ | 70,652 | $ | 71,388 | $ | 73,378 | $ | 141,564 | $ | 212,952 | $ | 286,330 | |||||||||||||||||||||
| Aerospace | 4,928 | 7,657 | 7,309 | 6,173 | 12,585 | 19,894 | 26,067 | ||||||||||||||||||||||||||||
| Commercial | 2,847 | 9,460 | 7,067 | 8,083 | 12,307 | 19,374 | 27,457 | ||||||||||||||||||||||||||||
| Segment operating profit (1) | 78,687 | 87,769 | 85,764 | 87,634 | 166,456 | 252,220 | 339,854 | ||||||||||||||||||||||||||||
| Corporate expenses | 13,008 | 11,157 | 11,228 | 10,527 | 24,165 | 35,393 | 45,920 | ||||||||||||||||||||||||||||
|
Restructuring and other impairment charges |
8,856 | 2,591 | 470 | 15,784 | 11,447 | 11,917 | 27,701 | ||||||||||||||||||||||||||||
|
Loss (gain) on sales of businesses and assets |
18 | — | — | (314 | ) | 18 | 18 | (296 | ) | ||||||||||||||||||||||||||
|
Minority interest in consolidated subsidiaries |
(187 | ) | (259 | ) | (196 | ) | (105 | ) | (446 | ) | (642 | ) | (747 | ) | |||||||||||||||||||||
|
Income from continuing operations before interest, taxes and minority interest |
56,992 | 74,280 | 74,262 | 61,742 | 131,272 | 205,534 | 267,276 | ||||||||||||||||||||||||||||
| Interest expense, net | 30,122 | 30,930 | 28,501 | 29,758 | 61,052 | 89,553 | 119,311 | ||||||||||||||||||||||||||||
|
Income from continuing operations before taxes and minority interest |
26,870 | 43,350 | 45,761 | 31,984 | 70,220 | 115,981 | 147,965 | ||||||||||||||||||||||||||||
|
Taxes on income from continuing operations |
11,662 |
14,477 |
13,406 |
10,545 |
26,139 |
39,545 |
50,090 |
||||||||||||||||||||||||||||
|
Income from continuing operations before minority interest |
15,208 |
28,873 |
32,355 |
21,439 |
44,081 |
76,436 |
97,875 |
||||||||||||||||||||||||||||
|
Minority interest in consolidated subsidiaries, net of tax |
187 | 259 | 196 | 105 | 446 | 642 | 747 | ||||||||||||||||||||||||||||
|
Income from continuing operations |
15,021 |
28,614 |
32,159 |
21,334 |
43,635 |
75,794 |
97,128 |
||||||||||||||||||||||||||||
|
Operating income from discontinued operations |
7,908 | 4,912 | 10,338 | 6,272 | 12,820 | 23,158 | 29,430 | ||||||||||||||||||||||||||||
|
Taxes (benefit) on income from discontinued operations |
(14 |
) |
(1,417 |
) |
178 |
8,037 |
(1,431 |
) |
(1,253 |
) |
6,784 |
||||||||||||||||||||||||
|
Income (loss) from discontinued operations |
7,922 |
6,329 |
10,160 |
(1,765 |
) |
14,251 |
24,411 |
22,646 |
|||||||||||||||||||||||||||
| Net income | $ | 22,943 | $ | 34,943 | $ | 42,319 | $ | 19,569 | $ | 57,886 | $ | 100,205 | $ | 119,774 | |||||||||||||||||||||
| Earnings per share: | |||||||||||||||||||||||||||||||||||
| Basic: | |||||||||||||||||||||||||||||||||||
|
Income from continuing operations |
$ |
0.38 |
$ | 0.72 | $ | 0.81 | $ |
0.54 |
$ |
1.10 |
$ |
1.92 |
$ |
2.45 |
|||||||||||||||||||||
|
Income (loss) from discontinued operations |
$ |
0.20 |
$ | 0.16 | $ |
0.26 |
$ |
(0.04 |
) | $ |
0.36 |
$ |
0.62 |
$ |
0.57 |
||||||||||||||||||||
| Net income | $ | 0.58 | $ | 0.88 | $ | 1.07 | $ | 0.49 | $ | 1.47 | $ | 2.53 | $ | 3.03 | |||||||||||||||||||||
| Diluted: | |||||||||||||||||||||||||||||||||||
|
Income from continuing operations |
$ |
0.38 |
$ | 0.72 | $ | 0.80 | $ |
0.54 |
$ |
1.10 |
$ |
1.90 |
$ |
2.44 |
|||||||||||||||||||||
|
Income (loss) from discontinued operations |
$ |
0.20 |
$ |
0.16 |
$ | 0.25 | $ |
(0.04 |
) | $ |
0.36 |
$ |
0.61 |
$ |
0.57 |
||||||||||||||||||||
| Net income | $ | 0.58 | $ | 0.88 | $ | 1.06 | $ | 0.49 | $ | 1.46 | $ | 2.52 | $ | 3.01 | |||||||||||||||||||||
|
Average number of common and common equivalent shares outstanding: |
|||||||||||||||||||||||||||||||||||
