- Q4 Net Sales up 16% to $1.7 Billion; FY Net Sales up 15% to $6.2 Billion
- Q4 Operational EPS up 10% to $1.37; FY Operational EPS up 29% to Record $5.71
- Completed Acquisition of Bang & Olufsen Automotive Audio Business
- Secured $400 Million and €350 Million in Long-Term Debt Financing
Harman International Industries, Incorporated (NYSE: HAR), the premier connected technologies company for automotive, consumer and enterprise markets, today announced results for the fourth quarter and full year ended June 30, 2015.
Net sales for the fourth quarter were $1.68 billion, an increase of 16 percent compared to the prior year or 28 percent excluding the impact of foreign currency translation (ex-FX). Excluding the impact of foreign currency translation and acquisitions, net sales increased 16 percent compared to the prior year. Infotainment net sales increased seven percent (21 percent ex-FX), due to platform expansions, higher take rates, and stronger automotive production. Lifestyle Audio net sales increased 13 percent (21 percent ex-FX), due to stronger home and multimedia and car audio sales. Net sales in Professional Solutions increased 15 percent (20 percent ex-FX), primarily driven by the acquisition of AMX, which expanded the Company’s product portfolio into enterprise automation and video switching.
Excluding restructuring, non-recurring charges and acquisition-related items, fourth quarter operating income increased 24 percent to $150 million compared to $121 million in the prior year, and earnings per diluted share increased 10 percent to $1.37 compared to $1.25 in the prior year. On a GAAP basis, fourth quarter operating income increased 99 percent to $114 million compared to $57 million in the prior year, EBITDA increased 82 percent to $168 million compared to $92 million in the prior year, and earnings per diluted share increased 63 percent to $1.01 compared to $0.62 in the prior year. The Company recorded $36 million of restructuring, non-recurring charges and acquisition-related items, compared to $64 million in the prior year.
Net sales for the full year were $6.16 billion, an increase of 15 percent (22 percent ex-FX) compared to the prior year, as Infotainment, Lifestyle and Professional all reported strong increases in net sales. Excluding the impact of foreign currency translation and acquisitions, net sales increased 15 percent compared to the prior year. Excluding restructuring, non-recurring charges and acquisition-related items, fiscal year 2015 operating income increased 29 percent to $554 million compared to $430 million in the prior year. On the same non-GAAP basis, earnings per diluted share increased 29 percent to $5.71 from $4.41 in the prior year. On a GAAP basis, fiscal year 2015 operating income increased 42 percent to $470 million from $330 million in prior year, EBITDA increased 38 percent to $639 million compared to $462 million in the prior year, and earnings per diluted share increased 44 percent to $4.84 compared to $3.36 in the prior year.
Dinesh C. Paliwal, the Company’s Chairman, President and CEO, said “In fiscal 2015, we delivered record revenue, EBITDA and earnings per share. Over the last two years, HARMAN has achieved outstanding growth, adding nearly $2 billion of revenue and increasing non-GAAP earnings per share by 86 percent.”
Paliwal continued, “With the introduction of industry first innovations in audio, system solutions, and embedded infotainment, particularly in the areas of cybersecurity and driver safety, we continue to deliver superior offerings for our customers. HARMAN is well positioned to capitalize on the increasing demand for the connected car, connected enterprise and connected lifestyle. In 2015, we further diversified our portfolio through strategic acquisitions, thereby strengthening our software capabilities and scaling connected services to fully address the opportunities presented at the intersection of cloud, mobility and analytics.”
The Company will hold an Investor Day in New York City on Thursday, August 6, 2015 and will provide financial guidance for fiscal 2016.
Summary of Operations – Gross Margin and SG&A (Non-GAAP)
Gross margin for the fourth quarter of fiscal year 2015 increased 210 basis points to 29.4 percent. The improvement was primarily due to the impact of higher sales volume leveraging a more efficient fixed production cost base and the expansion of the Company’s product portfolio into enterprise automation and video switching.
In the fourth quarter of fiscal year 2015, SG&A expense as a percentage of net sales increased 150 basis points to 20.4 percent, primarily due to the expansion of the Company’s product portfolio into enterprise automation and video switching and investments in marketing and research and development.
Fourth Quarter FY 2015 Highlights.
Harman Reports Fourth Quarter and Full Year Fiscal 2015 Results (Full Release).
