Bel Reports Fourth Quarter and 2012 Results

  Bel Reports Fourth Quarter and 2012 Results

Business Wire

JERSEY CITY, N.J. -- February 14, 2013

Bel Fuse Inc. (NASDAQ:BELFA) (NASDAQ:BELFB) today announced preliminary
unaudited financial results for the fourth quarter and 2012.

Highlights

  *For the fourth quarter of 2012, sales increased 4.5% to $71.8 million
    compared to $68.6 million for the fourth quarter of 2011. For 2012, sales
    decreased 2.9% to $286.6 million compared to $295.1 million for 2011.
  *For the fourth quarter of 2012, the GAAP net loss was $2.5 million, or
    $0.21 per Class A share and $0.22 per Class B share, compared to GAAP net
    earnings of $82,000, or $0.00 per Class A share and $0.01 per Class B
    share, for the fourth quarter of 2011. For 2012, GAAP net earnings were
    $2.4 million, or $0.17 per diluted Class A share and $0.21 per diluted
    Class B share, compared with GAAP net earnings of $3.8 million, or $0.28
    per diluted Class A share and $0.33 per diluted Class B share, for 2011
  *Restructuring charges of $3.1 million for the fourth quarter of 2012 and
    $5.2 million for 2012 are expected to result in annual operating cost
    reductions of about $5.6 million beginning in 2013.
  *For the fourth quarter of 2012, non-GAAP net earnings which excludes
    restructuring charges, acquisition costs and other charges increased to
    $979,000, compared to non-GAAP net earnings which excludes restructuring
    charges, litigation charges and other charges for the fourth quarter of
    2011 of $395,000. For 2012, non-GAAP net earnings rose to $7,365,000
    compared to $7,085,000 for 2011.
  *The acquisitions of Gigacom Interconnect, Fibreco Limited and Powerbox
    Italy completed in 2012 advance Bel's strategy to focus on sales of higher
    margin, non-commodity products.
  *Bel agreed to acquire the Transpower magnetics business of TE
    Connectivity, which had 2012 sales of about $75 million. Expected to close
    in the first quarter of 2013, this acquisition will solidify Bel's
    position as a world leader in integrated connector modules (ICMs).
  *Purchased 279,000 Class B common shares (for an aggregate cost of $4.9
    million) in the fourth quarter of 2012 and 369,000 Class B common shares
    (for an aggregate cost of $6.6 million) for all of 2012 under the $10
    million common share buyback program authorized by the Board in July 2012.

CEO comments

Daniel Bernstein, Bel's President and CEO, said, "In 2012, we made substantial
progress implementing our strategy to improve Bel's short and long-term growth
in revenue and profitability.

"Our first step was to immediately improve Bel's competitiveness and
profitability in our existing products. The restructuring program we completed
in 2012 was designed to reduce operating expenses by about $5.6 million
annually, beginning in 2013. Our GAAP net loss for the fourth quarter of 2012
primarily reflects the costs of this restructuring. On a non-GAAP basis,
excluding costs detailed in the table reconciling GAAP to non-GAAP financial
measures included in this release, net earnings for the fourth quarter of 2012
more than doubled versus the same quarter last year.

"We also agreed to acquire, for approximately $22.4 million in cash, the
Transpower magnetics business of TE Connectivity, which had 2012 sales of
approximately $75 million and is expected to be accretive to Bel's earnings
following the anticipated closing of the transaction by the end of the first
quarter of 2013. Included in this acquisition are ICM products, including
RJ45, 10/100 Gigabit, 10G, PoE/PoE+, MRJ21, RJ.5, a line of modules for
smart-grid applications and discrete magnetics. We expect this expanded
product line will double our sales of ICMs and related components, enabling us
to further improve Bel's cost structure and enhance our competitive position
in the market for ICM-related components. At closing, Bel will also receive a
license to produce ICM products using TE's planar embedded magnetics
technology.

"Our next step was to add product lines which have the potential for
significant growth over the next two to three years. A key component of this
plan was our recent acquisition of Milan-based Powerbox, which is intended to
add established AC-DC products to our existing power portfolio. In addition to
established products, the Powerbox acquisition provides Bel with valuable
design and manufacturing capabilities which will supplement our skill sets in
Europe, China and the United States. We believe that over the next few years,
the AC-DC power transformer business can grow, through our current customer
base, to over $30 million of annual revenue.

"The third stage of our growth plan includes development of fiber optic
products which we believe will become an industry standard for aerospace
military markets over a three to five-year horizon. Two small but important
acquisitions completed in 2012 set the foundation for this initiative, and
also contributed to sales growth in the fourth quarter of 2012. U.K.-based
Fibreco and Gigacom Interconnect AB have now been integrated into Bel's Cinch
Connectors business. We believe the combination of Fibreco's broad range of
expanded beam fiber-based connectors and Gigacom's expanded beam EBOSA^TM
products will enable Cinch to be a leader in fiber connector technology.
Because of the quality, reliability and weight benefits of fiber products in
comparison to copper components currently being used in the aerospace and
military markets, we see significant growth opportunities in this area. The
mil/aerospace market can represent as much as a third of Bel's total sales
within five years.

"Taken together, these actions have set a clear strategy for the Company over
the next five years."

Fourth Quarter Results

For the three months ended December 31, 2012, net sales increased to
$71,752,000 compared to $68,642,000 for the fourth quarter of 2011, reflecting
the contributions of the acquired businesses as well as higher sales of
magnetics and circuit products, partially offset by lower modular product
sales. Cost of sales decreased to 84.3% of sales for the fourth quarter of
2012, compared to 85.1% of sales for the fourth quarter of 2011.

The operating loss for the fourth quarter of 2012 was $3,117,000, compared to
operating income for the fourth quarter of 2011 of $1,084,000. Excluding costs
detailed in the table reconciling GAAP to non-GAAP financial measures included
in this release, non-GAAP operating income was $928,000 for the fourth quarter
of 2012, compared to $1,301,000 for the fourth quarter of 2011.

The net loss for the fourth quarter of 2012 included an income tax benefit of
$688,000, the result of pre-tax losses during the quarter. For the fourth
quarter of 2011, income tax expense was $1,078,000.

The net loss for the fourth quarter of 2012 was $2,537,000, compared to net
earnings for the fourth quarter of 2011 of $82,000.

Excluding the charges detailed in the table reconciling GAAP to non-GAAP
financial measures mentioned above, non-GAAP net earnings for the fourth
quarter of 2012 were $979,000. This compares to non-GAAP net earnings for the
fourth quarter of 2011, excluding charges detailed in the reconciliation
table, of $395,000.

The net loss per Class A common share for the fourth quarter of 2012 was
$0.21, compared to net earnings per diluted Class A common share of $0.00 for
the fourth quarter of 2011. Adjusted to exclude the amounts referenced above,
non-GAAP net earnings per diluted Class A common share were $0.08 for the
fourth quarter of 2012, compared to $0.10 for the fourth quarter of 2011.

The net loss per Class B common share was $0.22 for the fourth quarter of
2012, compared to net earnings per diluted Class B common share of $0.01 for
the fourth quarter of 2011. Adjusted to exclude the amounts referenced above,
non-GAAP net earnings per diluted Class B common share were $0.09 for the
fourth quarter of 2012, compared to $0.11 for the fourth quarter of 2011.

Balance Sheet Data

As of December 31, 2012, Bel reported working capital of $144,748,000,
including cash, cash equivalents and marketable securities of $71,264,000, a
current ratio of 4.1-to-1, total long-term obligations of $13,439,000, and
stockholders' equity of $215,391,000. In comparison, at December 31, 2011, Bel
reported working capital of $165,264,000, including cash, cash equivalents,
and marketable securities of $93,972,000, a current ratio of 4.9-to-1, total
long-term obligations of $13,406,000, and stockholders' equity of
$221,080,000.

Twelve Month Results

For the twelve months ended December 31, 2012, net sales decreased to
$286,594,000 compared to $295,121,000 for 2011. Net earnings for 2012 were
$2,402,000, compared to net earnings for 2011 of $3,764,000.

Net earnings per diluted Class A common share for 2012 were $0.17, compared to
$0.28 for 2011. Adjusted to exclude various amounts, detailed in the
reconciliation table included in this release, non-GAAP net earnings per
diluted Class A common share were $0.58 for 2012, compared to non-GAAP net
earnings per diluted share of $0.56 for 2011.

Net earnings per diluted Class B common share for 2012 were $0.21, compared to
$0.33 for 2011. Adjusted to exclude the amounts referenced above, non-GAAP net
earnings per diluted Class B common share were $0.63 for 2012, compared to
$0.61 for 2011.

Conference Call

Bel has scheduled a conference call at 11:00 a.m. EST today. To participate in
the call, dial (720) 545-0088, conference ID #88040702. A simultaneous webcast
is available from the Investors link under the "About Bel" tab at
www.BelFuse.com. The webcast will be available for replay for a period of 20
days at this same Internet address. For a telephone replay, dial (404)
537-3406, conference ID #88040702, after 2:00 p.m. EST.

About Bel

Bel (www.belfuse.com) and its divisions are primarily engaged in the design,
manufacture, and sale of products used in networking, telecommunications,
high-speed data transmission, commercial aerospace, military, transportation,
and consumer electronics. Products include magnetics (discrete components,
power transformers and MagJack® connectors with integrated magnetics), modules
(DC-DC converters and AC-DC power supplies, integrated analog front-end
modules and custom designs), circuit protection (miniature, micro and surface
mount fuses) and interconnect devices (micro, circular and filtered D-Sub
connectors, fiber optic connectors, passive jacks, plugs and high-speed cable
assemblies). The Company operates facilities around the world.

Forward-Looking Statements

Except for historical information contained in this press release, the matters
discussed in this press release (including the statements regarding the future
impact of restructuring charges taken during 2012; the timing of the closing
of the acquisition of the Transpower magnetics business of TE Connectivity and
the parties' abilities to satisfy all conditions of closing with respect to
that acquisition; the impact of that acquisition on Bel's ICM sales and
business, on Bel's cost structure and on Bel's competitive position; the
expected accretive nature of that acquisition; the impact of the Powerbox
acquisition on the future growth of Bel's AC-DC power transformer business;
the future revenues of Bel's AC-DC power transformer business; the potential
contribution of fiber optic products to Bel's future operating results; the
potential growth in Bel's sales to the aerospace market; the anticipated
effects of the three aspects of Bel's growth plan on Bel's ability to achieve
near-term improvements in profitability, on Bel's competitive position in
high-volume commodity components, on Bel's technology base and on Bel's
ability to expand its portfolio of non-commodity technologically advanced
components; and the potential for non-commodity technologically advanced
components to become the primary drivers of Bel's future sales and earnings)
are forward-looking statements that involve risks and uncertainties. Actual
results could differ materially from Bel's projections. Among the factors that
could cause actual results to differ materially from such statements are: the
market concerns facing our customers; the continuing viability of sectors that
rely on our products; the effects of business and economic conditions;
difficulties associated with integrating recently acquired companies; capacity
and supply constraints or difficulties; product development, commercializing
or technological difficulties; the regulatory and trade environment; risks
associated with foreign currencies; uncertainties associated with legal
proceedings; the market's acceptance of the Company's new products and
competitive responses to those new products; and the risk factors detailed
from time to time in the Company's SEC reports. In light of the risks and
uncertainties, there can be no assurance that any forward-looking statement
will in fact prove to be correct. We undertake no obligation to update or
revise any forward looking statements.

BEL FUSE INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(000s omitted, except for per share data)
                                                         
                                                                   
                   Three Months Ended              Twelve Months Ended
                   December 31,                    December 31,
                    2012         2011           2012          2011    
                                                                   
                   (unaudited)                     (unaudited)
                                                                   
Net sales          $ 71,752       $ 68,642         $ 286,594       $ 295,121
                                                                   
Costs and
expenses:
Cost of sales        60,505         58,384           240,092         244,749
Selling,
general and          11,207         8,957            39,343          39,284
administrative
Litigation           --             --               26              3,471
charges
Restructuring        3,085          314              5,245           314
charges
Loss (gain) on
disposal of
property,           72           (97    )        183           (93     )
plant and
equipment
                                                                   
Total costs         74,869       67,558         284,889       287,725 
and expenses
                                                                   
(Loss) income
from                 (3,117 )       1,084            1,705           7,396
operations
(Loss) gain on       (142   )       --               (917    )       119
investment
Interest             (14    )       --               (16     )       --
expense
Interest
income and          48           76             266           357     
other, net
                                                                   
(Loss)
earnings
before               (3,225 )       1,160            1,038           7,872
(benefit)
provision for
income taxes
(Benefit)
provision for       (688   )      1,078          (1,364  )      4,108   
income taxes
                                                                   
Net (loss)         $ (2,537 )     $ 82            $ 2,402        $ 3,764   
earnings
                                                                   
(Loss)
earnings per
Class A common     $ (0.21  )     $ 0.00          $ 0.17        $ 0.28    
share - basic
and diluted
                                                                   
Weighted
average Class
A common
shares
outstanding
- basic and         2,175        2,175          2,175         2,175   
diluted
                                                                   
(Loss)
earnings per
Class B common     $ (0.22  )     $ 0.01          $ 0.21         $ 0.33    
share - basic
and diluted
                                                                   
Weighted
average Class
B common
shares
outstanding
- basic and         9,493        9,637          9,625         9,598   
diluted
                                                                             

CONDENSED CONSOLIDATED BALANCE SHEET DATA
(000s omitted)


             Dec. 31,      Dec. 31,                      Dec. 31,      Dec. 31,
ASSETS        2012            2011              LIABILITIES &   2012            2011
                                                EQUITY
              (unaudited)     (unaudited)                       (unaudited)     (unaudited)



Current       $  191,136      $  207,689        Current         $  46,388       $  42,425
assets                                          liabilities
Property,
plant
&                                               Noncurrent
equipment,       34,988          39,414         liabilities        13,439          13,406
net
Goodwill
and              35,181          15,040
intangibles
Other           13,913         14,768         Stockholders'     215,391        221,080
assets                                          equity
                                                                                
Total                                           Total
Assets        $  275,218      $  276,911        Liabilities &   $  275,218      $  276,911
                                                Equity
                                                                                   

BEL FUSE INC. AND SUBSIDIARIES
NON-GAAP MEASURES (unaudited)
(000s omitted, except for per share data)

                      Three Months Ended December 31, 2012                          Twelve Months Ended December 31, 2012
                                                        Net (loss)      Net (loss)                                      Net             Net
                                                        earnings        earnings                                        earnings        earnings
                        Income                                                          Income                          per             per
                        (loss)         Net (loss)       per Class A     per Class B                    Net
                        from                        common        common          from                        Class A       Class B
                                       earnings^(2)                                                    earnings^(2)     common          common
                        operations                      share -         share -         operations
                                                        diluted^(3)     diluted^(3)                                     share -         share -
                                                                                                                        diluted^(3)     diluted^(3)
                                                                                                                                        
GAAP measures           $ (3,117 )     $  (2,537  )     $  (0.21  )     $  (0.22  )     $ 1,705        $  2,402         $  0.17         $  0.21
Restructuring                                                                                      
charges,
severance and
reorganization            3,381           2,171            0.18            0.19           6,075           4,067            0.33            0.35
costs
Storm clean-up and
damage to
property, plant and       341             211              0.02            0.02           341             211              0.02            0.02
equipment
Gain on other
disposals
of property, plant        (202   )        (180    )        (0.01  )        (0.02  )       (91    )        (111    )        (0.01  )        (0.01  )
and equipment
Acquisition-related       525             556              0.05            0.05           1,283           1,026            0.08            0.09
costs
Impairment of Pulse
shares, net of            --              382              0.03            0.03           --              863              0.07            0.07
income tax
Expiration of tax
statutes of
limitations and R&D      --            376            0.03          0.03         --            (1,093  )       (0.09  )       (0.09  )
credit, net
                                                                                                                                        
Non-GAAP                $ 928         $  979          $  0.08        $  0.09        $ 9,313       $  7,365        $  0.58        $  0.63   
measures^(1)
                                                                                                                                        
                                                                                                                                        
                        Three Months Ended December 31, 2011                            Twelve Months Ended December 31, 2011
                                                        Net             Net                                             Net             Net
                                                        earnings        earnings                                        earnings        earnings
                        Income                                                          Income                          per             per
                                       Net              per Class A     per Class B                    Net
                        from                            common          common          from                            Class A         Class B
                                       earnings^(2)                                                    earnings^(2)     common          common
                        operations                      share -         share -         operations
                                                        diluted^(3)     diluted^(3)                                     share -         share -
                                                                                                                        diluted^(3)     diluted^(3)
                                   
GAAP measures           $ 1,084        $  82            $  0.00         $  0.01         $ 7,396        $  3,764         $  0.28         $  0.33
Restructuring
charges, severance
and reorganization        314             234              --              --             449             326              0.03            0.03
costs
Litigation charges,       --              139              0.02            0.02           3,071           2,961            0.24            0.25
net
Costs associated
with Pulse proxy          --              --               --              --             267             166              0.01            0.01
initiative
Gain on sale of
property, plant and       (97    )        (60     )        --              --             (93    )        (58     )        --              --
equipment
Gain on sale of
Pulse shares, net        --            --             --            --           --            (74     )       (0.01  )       (0.01  )
of tax
                                                                                                                                        
Non-GAAP                $ 1,301       $  395          $  0.10        $  0.11        $ 11,090      $  7,085        $  0.56        $  0.61   
measures^(1)
                                                                                                                                        

        The non-GAAP measures presented above are not measures of performance
        under accounting principles generally accepted in the United States of
        America ("GAAP"). These measures should not be considered a substitute
        for, and the reader should also consider, (loss) income from
(1)   operations, net (loss) earnings, (loss) earnings per share and other
        measures of performance as defined by GAAP as indicators of our
        performance or profitability. Our non-GAAP measures may not be
        comparable to other similarly-titled captions of other companies due
        to differences in the method of calculation.
        
        Based upon discussions with investors and analysts, we believe that
        the reader's understanding of Bel's performance and profitability is
        enhanced by reference to these non-GAAP measures. Removal of amounts
        such as charges for restructuring, severance, reorganization, losses
        on the disposal of property, plant and equipment, costs related to
        Hurricane Sandy and acquisition-related costs facilitates comparison
        of our results among reporting periods. We believe that such amounts
        are not reflective of the relevant business in the period in which the
        charge is recorded for accounting purposes.

(2)     Net of income tax at effective rate in the applicable tax
        jurisdiction.

(3)     Individual amounts of net (loss) earnings per share may not agree to
        the total due to rounding.

Contact:

Investor Contact:
Neil Berkman Associates
(310) 477-3118
info@berkmanassociates.com
or
Company Contact:
Daniel Bernstein
President & CEO
(201) 432-0463
 
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