Q4 2024 Belden Inc Earnings Call

Ladies and gentlemen, thank you for standing by. Welcome to this morning's Belden Report 4th quarter 2024 results.

Just as a reminder of this call is being recorded.

At this time you are in a listen only mode. Later we will conduct a question and answer session. And If you to ask.

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list

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the question. Thank you for you and we calling back to his dryer. May I have your confirmation press start code too.

I would now

Electric on the

Over to Mr. Aaron Reddington.

Please go ahead, sir.

Call

Press release presentation and transcript of these prepared remarks.

Are currently available online at investor. Beldon.com.

Turning to slide 2 in the presentation.

During this call management will make certain forward looking statements.

And reliance upon the safe harbor provisions of the private securities litigation Reform Act of 1995.

For more information

Please review today's press release and our most recent annual report on Form 10K.

Additionally, during today's call management will reference adjusted or non-GAAP financial information.

In accordance with regulation G.

The appendix to our presentation and the investor relations section of our website.

Contains a reconciliation of the most closely associated GAAP financial information.

the non-GAAP financial information we communicate.

I will now turn the call over to our president and CEO Ashish Chand.

Thank you, Adam.

And good morning, everyone.

We appreciate you joining us.

That's for stone slide 4 for a summary of the major accomplishments we achieved.

During the 4th quarter and full la.

And key messages I would like to highlight.

As a reminder

I will be referring to adjusted results today.

first.

Let me congratulate our team on another solid quarter.

We once again executed well.

And delivered results ahead of expectations.

For the 4th quarter.

Our revenue and earnings per share.

Both exceeded the high end of our guidance.

As a solutions transformation continues to progress.

Revenue total

$666 million.

up 21% compared to the prior year.

And earnings per share came in at $1.92.

Profitability aligned with our expectations.

And our adjusted Ebita margins.

came in at 17.1% for the quarter.

Up 110 basis points.

Compared to the prior year

second.

Demand for the quarter was steady.

As a customers remained in a neutral posture.

To close out a transitional layer.

For the 4th quarter,

Orders were up modestly sequentially.

And up 23% compared to the prior year.

I'm pleased to report that for the full year.

Our orders were up 9%.

Reaching nearly $2.5 billion.

Overall, our business grew by 14% organically for the quarter.

We saw particular strength in the Americas with organic growth of 23%.

As the air progressed,

We've witnessed a strong and steady improvement in ordering patterns across many geographies and verticals.

I'm encouraged to see this progress continue.

With additional upside ahead as we look further into 2025.

Finally

Our business continues to generate meaningful cash flow.

And we are deploying capital consistent with the capital allocation priorities.

Only a free cash flow was strong.

At $223 million.

Likely had a prior performance and expectations.

With the ample free cash flow, our team continues to invest in high return opportunities.

Beneficial to shareholders.

So you, we deployed $295 million towards to and acquisitions.

That enhanced our product portfolio.

And improved our solutions offerings.

Hello?

We continued buying back our stock.

During the 4th quarter, repurchased approximately 500 million shares.

For $55 million.

That brings a fully a total to 1.3 million shares.

For $133 million.

Our ballot sheet remains strong.

Allowing us to enhance shareholder returns in multiple ways.

You can expect us to continue looking for acquisitions that support our solutions transformation.

And when appropriate.

Returning capital to our shareholders to buybacks.

Now please turn to slide 5.

Reflecting on the past here, I'm proud of Beldon's tremendous progress.

In executing upon our strategy.

Outlined during our most recent.

First, the here we continued strengthening our leadership in automation and infrastructure technologies.

By expanding our networking and data solutions portfolio.

With multiple significant upgrades.

Let me quickly highlight recent improvements to our OT network switching line.

Including the introduction of the Hirshman BXP manage switch.

Idle for rail applications.

The switch features a compact design.

Enhanced flexibility and interoperability.

And support for high-speed data requirements.

This product introduction showcases how our teams are working hard to solidify and improve our competitive positioning in peak growth particles.

Both of the sale

We continue to expand and deepen our ecosystem partnerships.

Including our integration with AWS.

After incorporating cloud rail into our technology stack this past year.

We can now streamline and standardize.

Data discovery acquisition and normalization.

And deliver it in a ready to use format for end customers using the AWS platform.

This is a huge benefit to our customers and just one example of improvements we are making to our offerings.

Provide complete networking and data solutions.

Second

We made significant strides in advancing our solutions capabilities.

As we discussed previously,

2024 was there, we expanded into smart infrastructure.

And brought solutions to our entire organization.

Our sales function was restructured to align with key growth vertical.

Empowering our teams to leverage our complete product portfolio.

To build compelling solutions for customers.

though.

As outlined during our investor day.

Our teams are working diligently to expand our library of common reference architectures.

Improve our software capabilities.

And fully utilize our customer innovation centers.

Now that they're all up and running.

With our expanded focus on solutions across the entire organization.

Much has been accomplished this year.

And a momentum going forward is significant.

3rd.

We demonstrated discipline capital allocation.

To targeted tuck in acquisitions.

With the acquisition of precision optical, we enhanced our solutions capabilities by broadening our product portfolio.

And delivering a more comprehensive solutions offering.

Our acquisition expands our fiber offering with key MSO customers benefiting from strong secular growth trends.

Finally

We demonstrated operational excellence and financial discipline.

During a year of improving business conditions.

Revenue for the 4th quarter was up 21% air.

With even the margins up 110 basis points.

Our cash flow is strong.

And we ended the year with free cash flow of $223 million.

Or 9.1% of revenue.

On our way towards a long term target of 10%.

These accomplishments underscore our unwavering commitment to delivering sustainable earnings growth.

And strong free cash flow generation.

Through the business cycle.

Now please turn to slide 6.

This quarter I want to highlight two solutions examples.

From the power transmission and distribution vertical.

To illustrate how our solution strategy drives success in the marketplace.

The first example

is a significant award from a national energy and water authority.

In Ami.

Valued at approximately €11 million.

This project involves upgrading the network backbone.

And providing support.

To ensure a successful deployment.

The customer faced challenges with the legacy network and outdated equipment.

Which limited scalability.

Our solutions team developed a comprehensive network design.

Based on our XTR MPLS platform.

The communications technology that delivers scalable solutions.

Large networks with multiple nodes.

This solution enables the customer to integrate legacy applications.

With advanced Ethernet functionalities.

All within a reliable, scalable, and easily serviceable platform.

The second example comes from a Midwest Electric Cooperative.

The contract valued at $3 million.

Similarly, this customer was managing multiple legacy systems and protocols.

which hindered scalability.

Troubleshooting and network resilience.

Our solutions team collaborated with the customer to design a network.

That included considerations for the utilities, future digital strategy.

Using a similar Xstrand solution.

Weldon was awarded the project after a successful proof of concept in the field.

Utilizing our customer innovation center as a remote note.

These examples demonstrate our solutions and action.

As outlined during our investor day, we focus on verticals and use cases.

Where our technology is most effective.

And benefits from strong secular trends.

In these cases

Our power transmission and distribution experts.

Leverage key insights.

To quickly deliver repeatable.

Western class designs.

That address real world challenges and can be implemented efficiently.

Looking ahead, we are committed to advancing our solution strategy by becoming trusted industry experts who provide scalable solutions.

Leveraging's active and passive portfolio.

We firmly believe our solutions offer superior value in the marketplace.

All the time

Successes like these.

will drive increased sales and deepen relationships.

With key customers.

long term stickier partnerships.

I will now request Jeremy to provide additional insight.