Littelfuse : Form 10-Q

United States

Securities and Exchange Commission

Washington, D.C. 20549

FORM 10-Q

(Mark one) [X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 29, 2018

OR

[ ]

TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES ACT OF 1934 For the transition period from ___ to ___

Commission file number 0-20388

LITTELFUSE, INC.

(Exact name of registrant as specified in its charter)

Delaware	36-3795742
(State or other jurisdiction of	(I.R.S. Employer Identification No.)
incorporation or organization)
8755 West Higgins Road, Suite 500
Chicago, Illinois	60631
(Address of principal executive offices)	(ZIP Code)

Registrant's telephone number, including area code: 773-628-1000

Securities registered pursuant to Section 12(b) of the Act:

Name of Each ExchangeTitle of Each ClassCommon Stock, $0.01 par valueOn Which RegisteredNASDAQ Global Select MarketSM

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act (Check one): Large accelerated filer [X] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [ ] Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes [ ] No [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

As of October 29, 2018, the registrant had outstanding 25,156,759 shares of Common Stock, net of Treasury Shares.

1

TABLE OF CONTENTS

PagePART I

Item 1.

FINANCIAL INFORMATIONFinancial Statements

Condensed Consolidated Balance Sheets as of September 29, 2018 (unaudited) and December 30, 2017 3

Condensed Consolidated Statements of Net Income for the three and nine months ended September 29, 2018 (unaudited) and

September 30, 2017 (unaudited) 4

Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 29, 2018

(unaudited) and September 30, 2017 (unaudited) 5

Condensed Consolidated Statements of Cash Flows for the nine months ended September 29, 2018 (unaudited) and September 30,

2017 (unaudited) 6

Notes to Condensed Consolidated Financial Statements (unaudited)7

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37
PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	38
Item 1A.	Risk Factors	38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosures	38
Item 5.	Other Information	38
Item 6.	Exhibits	39
Signatures	40

2

(in thousands) ASSETSCurrent assets:

Cash and cash equivalents Short-term investments

LITTELFUSE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

Trade receivables, less allowances(September 29, 2018 - $36,392; December 30, 2017 - $27,516)Inventories

Prepaid income taxes and income taxes receivable Prepaid expenses and other current assets

Total current assets

Property, plant, and equipment:

Land

Buildings Equipment

Accumulated depreciation and amortization

Net property, plant, and equipment Intangible assets, net of amortization Goodwill

Investments

Deferred income taxes Other assets

Total assets

LIABILITIES AND EQUITYCurrent liabilities:

Accounts payable Accrued payroll Accrued expenses Accrued severance Accrued income taxes

Current portion of long-term debt

Total current liabilities

Long-term debt, less current portion Deferred income taxes

Accrued post-retirement benefits Other long-term liabilities Shareholders' equity:

Common stock, par value $0.01 per share: 34,000,000 shares authorized; shares issued, September 29, 2018- 25,630,347; December 30, 2017-22,713,198

Treasury stock, at cost: 475,994 and 439,598 shares, respectively Additional paid-in capital

Accumulated other comprehensive loss Retained earnings

Littelfuse, Inc. shareholders' equity Non-controlling interest

Total equity

Total liabilities and equity

See accompanying Notes to Condensed Consolidated Financial Statements.

3

(Unaudited)

September 29, 2018

December 30, 2017

$

498,215 35

251,644 182,699

247,255140,789

6,802 1,689

48,68337,452

$

429,676 35

1,052,634 792,340

29,528 9,547

119,38086,599

569,550 505,838

(374,575)

(351,407)

343,883 250,577

377,151203,850

830,354 453,414

29,08410,993

8,979 11,858

21,40117,070

$

2,663,486

$

1,740,102

$

129,871$ 101,844

52,208 49,962

74,08448,994

901 1,459

36,74616,285

10,076 6,250

303,886224,794

690,637 489,361

49,26217,069

32,901 18,742

67,40462,580

(48,546)

830,612

(97,631)

834,577

1,519,266

130

1,519,396

$

2,663,486$

(41,294)

310,012

(63,668)

722,140

927,419

137

927,556

1,740,102

CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME

(Unaudited)

Three Months EndedLITTELFUSE, INC.

September 29,	September 30,	September 29,	September 30,
2018	2017	2018	2017
$	439,191$	317,889$	1,316,187$	916,685
259,597	184,238	817,983	536,776
179,594	133,651	498,204	379,909
Selling, general, and administrative expenses	69,782	56,759	220,540	156,899
Research and development expenses	20,454	11,991	65,742	36,872
Amortization of intangibles	13,130	6,292	38,501	18,407
Total operating expenses	103,366	75,042	324,783	212,178
Operating income	76,228	58,609	173,421	167,731
Interest expense	5,775	3,467	16,980	9,868
Foreign exchange loss (gain)	982	632	(6,372)	(1,483)
Other expense (income), net	1,259	(1,013)	(2,362)	(962)
Income before income taxes	68,212	55,523	165,175	160,308
Income taxes	14,666	12,715	33,275	29,970
Net income	$	130,338
Income per share:
Basic	$	5.75
Diluted	$	5.69
Weighted-average shares and equivalent shares outstanding:
Basic	22,678
Diluted	22,906

(in thousands, except per share data)

Net sales

Cost of sales Gross profitSee accompanying Notes to Condensed Consolidated Financial Statements.

53,546

Nine Months Ended

$

42,808

$

131,900

$

2.13$

1.88$

5.31$

2.10

$

1.87

$

5.23

$

25,10925,471

22,71324,817

22,953 25,212

4

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

Three Months Ended

(in thousands)

Net income

Other comprehensive (loss) income:

Pension and postemployment adjustment, net of tax Unrealized loss on investments

Foreign currency translation adjustments Comprehensive income

LITTELFUSE, INC.

September 29, 2018

$

$

See accompanying Notes to Condensed Consolidated Financial Statements.

53,546$

45,599

(7,832)

(115)

-

$

September 30,	September 29,	September 30,
2017	2018	2017
131,900$	130,338
648	(441)
-	(1,235)
(24,816)	2,912
131,574

42,808$

(60)(1,710)

1,531

42,569

Nine Months Ended

$

107,732

$

5