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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Hubbell Incorporated | NYSE:HUBB | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-1.99 | -0.53% | 371.31 | 377.04 | 367.2739 | 374.03 | 100,665 | 15:29:16 |
Connecticut
|
06-0397030
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(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
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40 Waterview Drive
|
|
|
Shelton,
|
CT
|
06484
|
(Address of principal executive offices)
|
(Zip Code)
|
|
(475)
|
882-4000
|
|
(Registrant’s telephone number, including area code)
|
N/A
|
(Former name, former address and former fiscal year, if changed since last report.)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock - par value $0.01 per share
|
HUBB
|
New York Stock Exchange
|
Table of contents
|
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PART I
|
FINANCIAL INFORMATION
|
ITEM 1
|
Financial Statements
|
|
Three Months Ended March 31,
|
|||||
(in millions, except per share amounts)
|
2020
|
|
2019
|
|
||
Net sales
|
$
|
1,090.3
|
|
$
|
1,087.3
|
|
Cost of goods sold
|
776.8
|
|
780.0
|
|
||
Gross profit
|
313.5
|
|
307.3
|
|
||
Selling & administrative expenses
|
194.7
|
|
186.4
|
|
||
Operating income
|
118.8
|
|
120.9
|
|
||
Interest expense, net
|
(15.1
|
)
|
(17.5
|
)
|
||
Other expense, net
|
(3.8
|
)
|
(5.4
|
)
|
||
Total other expense
|
(18.9
|
)
|
(22.9
|
)
|
||
Income before income taxes
|
99.9
|
|
98.0
|
|
||
Provision for income taxes
|
24.2
|
|
24.2
|
|
||
Net income
|
75.7
|
|
73.8
|
|
||
Less: Net income attributable to noncontrolling interest
|
0.7
|
|
1.5
|
|
||
Net income attributable to Hubbell Incorporated
|
$
|
75.0
|
|
$
|
72.3
|
|
Earnings per share
|
|
|
|
|
||
Basic
|
$
|
1.38
|
|
$
|
1.32
|
|
Diluted
|
$
|
1.37
|
|
$
|
1.32
|
|
Cash dividends per common share
|
$
|
0.91
|
|
$
|
0.84
|
|
|
Three Months Ended March 31,
|
|||||
(in millions)
|
2020
|
|
2019
|
|
||
Net income
|
$
|
75.7
|
|
$
|
73.8
|
|
Other comprehensive (loss) income:
|
|
|
|
|
||
Foreign currency translation adjustments
|
(25.6
|
)
|
7.1
|
|
||
Defined benefit pension and post-retirement plans, net of taxes of ($0.6) and ($0.5)
|
1.7
|
|
1.5
|
|
||
Available-for-sale investments, net of taxes of $0.0 and ($0.1)
|
(0.1
|
)
|
0.3
|
|
||
Unrealized gain (loss) on cash flow hedges, net of taxes of ($0.6) and $0.2
|
1.6
|
|
(0.6
|
)
|
||
Other comprehensive (loss) income
|
(22.4
|
)
|
8.3
|
|
||
Total comprehensive income
|
53.3
|
|
82.1
|
|
||
Less: Comprehensive income attributable to noncontrolling interest
|
0.7
|
|
1.5
|
|
||
Comprehensive income attributable to Hubbell Incorporated
|
$
|
52.6
|
|
$
|
80.6
|
|
(in millions)
|
March 31, 2020
|
|
December 31, 2019
|
|
||
ASSETS
|
|
|
|
|
||
Current Assets
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
300.0
|
|
$
|
182.0
|
|
Short-term investments
|
13.5
|
|
14.2
|
|
||
Account receivable (net of allowances of $13.6 and $7.7)
|
707.7
|
|
683.0
|
|
||
Inventories, net
|
595.7
|
|
633.0
|
|
||
Other current assets
|
58.1
|
|
62.0
|
|
||
Total Current Assets
|
1,675.0
|
|
1,574.2
|
|
||
Property, Plant, and Equipment, net
|
495.5
|
|
505.2
|
|
||
Other Assets
|
|
|
|
|
||
Investments
|
53.2
|
|
55.7
|
|
||
Goodwill
|
1,807.1
|
|
1,811.8
|
|
||
Other intangible assets, net
|
758.8
|
|
781.5
|
|
||
Other long-term assets
|
169.5
|
|
174.6
|
|
||
TOTAL ASSETS
|
$
|
4,959.1
|
|
$
|
4,903.0
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
||
Current Liabilities
|
|
|
|
|
||
Short-term debt and current portion of long-term debt
|
$
|
106.7
|
|
$
|
65.4
|
|
Accounts payable
|
358.4
|
|
347.7
|
|
||
Accrued salaries, wages and employee benefits
|
65.9
|
|
101.5
|
|
||
Accrued insurance
|
78.0
|
|
68.1
|
|
||
Other accrued liabilities
|
232.3
|
|
262.2
|
|
||
Total Current Liabilities
|
841.3
|
|
844.9
|
|
||
Long-Term Debt
|
1,597.3
|
|
1,506.0
|
|
||
Other Non-Current Liabilities
|
592.0
|
|
591.6
|
|
||
TOTAL LIABILITIES
|
3,030.6
|
|
2,942.5
|
|
||
Hubbell Incorporated Shareholders’ Equity
|
1,914.9
|
|
1,947.1
|
|
||
Noncontrolling interest
|
13.6
|
|
13.4
|
|
||
Total Equity
|
1,928.5
|
|
1,960.5
|
|
||
TOTAL LIABILITIES AND EQUITY
|
$
|
4,959.1
|
|
$
|
4,903.0
|
|
|
Three Months Ended March 31,
|
|||||
(in millions)
|
2020
|
2019
|
||||
Cash Flows from Operating Activities
|
|
|
|
|
||
Net income
|
$
|
75.7
|
|
$
|
73.8
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
||||
Depreciation and amortization
|
38.9
|
|
36.6
|
|
||
Deferred income taxes
|
1.6
|
|
3.0
|
|
||
Stock-based compensation
|
11.6
|
|
4.1
|
|
||
Provision for bad debt expense
|
5.3
|
|
0.8
|
|
||
Changes in assets and liabilities, excluding effects of acquisitions:
|
|
|
|
|||
(Increase) decrease in accounts receivable, net
|
(36.8
|
)
|
9.3
|
|
||
Decrease (increase) in inventories, net
|
32.7
|
|
(10.7
|
)
|
||
Increase in accounts payable
|
15.2
|
|
12.6
|
|
||
Decrease in current liabilities
|
(48.8
|
)
|
(61.1
|
)
|
||
Changes in other assets and liabilities, net
|
7.5
|
|
9.2
|
|
||
Contribution to qualified defined benefit pension plans
|
(0.1
|
)
|
(0.1
|
)
|
||
Other, net
|
5.6
|
|
0.6
|
|
||
Net cash provided by operating activities
|
108.4
|
|
78.1
|
|
||
Cash Flows from Investing Activities
|
|
|
|
|
||
Capital expenditures
|
(17.8
|
)
|
(23.3
|
)
|
||
Acquisition of businesses, net of cash acquired
|
(2.1
|
)
|
—
|
|
||
Purchases of available-for-sale investments
|
(4.7
|
)
|
(1.0
|
)
|
||
Proceeds from available-for-sale investments
|
6.5
|
|
2.7
|
|
||
Other, net
|
2.5
|
|
1.5
|
|
||
Net cash used in investing activities
|
(15.6
|
)
|
(20.1
|
)
|
||
Cash Flows from Financing Activities
|
|
|
|
|||
Long-term debt borrowings
|
100.0
|
|
—
|
|
||
Long-term debt repayments
|
(6.3
|
)
|
(6.3
|
)
|
||
Short-term debt borrowings, net
|
38.1
|
|
21.2
|
|
||
Payment of dividends to shareholders
|
(49.5
|
)
|
(45.8
|
)
|
||
Payment of dividends to noncontrolling interest
|
(0.6
|
)
|
(1.0
|
)
|
||
Repurchase of common stock
|
(41.3
|
)
|
(10.0
|
)
|
||
Other, net
|
(4.7
|
)
|
(1.8
|
)
|
||
Net cash (used) provided by financing activities
|
35.7
|
|
(43.7
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(10.5
|
)
|
2.0
|
|
||
Increase in cash and cash equivalents
|
118.0
|
|
16.3
|
|
||
Cash and cash equivalents
|
|
|
||||
Beginning of period
|
182.0
|
|
189.0
|
|
||
End of period
|
$
|
300.0
|
|
$
|
205.3
|
|
|
|
|
Three Months Ended March 31,
|
|||||
in millions
|
2020
|
2019
|
||||
Net sales
|
|
|
||||
Commercial and Industrial
|
$
|
213.0
|
|
$
|
221.3
|
|
Construction and Energy
|
191.4
|
|
188.4
|
|
||
Lighting
|
201.7
|
|
220.5
|
|
||
Total Electrical
|
$
|
606.1
|
|
$
|
630.2
|
|
Power Systems
|
326.3
|
|
291.9
|
|
||
Aclara
|
157.9
|
|
165.2
|
|
||
Total Utility Solutions
|
$
|
484.2
|
|
$
|
457.1
|
|
TOTAL
|
$
|
1,090.3
|
|
$
|
1,087.3
|
|
|
Three Months Ended March 31,
|
|||||
in millions
|
2020
|
2019
|
||||
Net sales
|
|
|
||||
United States
|
$
|
549.7
|
|
$
|
565.7
|
|
International
|
56.4
|
|
64.5
|
|
||
Total Electrical
|
$
|
606.1
|
|
$
|
630.2
|
|
United States
|
455.5
|
|
431.2
|
|
||
International
|
28.7
|
|
25.9
|
|
||
Total Utility Solutions
|
$
|
484.2
|
|
$
|
457.1
|
|
TOTAL
|
$
|
1,090.3
|
|
$
|
1,087.3
|
|
|
|
Net Sales
|
Operating Income
|
Operating Income as a % of Net Sales
|
|||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
||||
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|||||||
Electrical
|
$
|
606.1
|
|
$
|
630.2
|
|
$
|
58.0
|
|
$
|
68.6
|
|
9.6
|
%
|
10.9
|
%
|
Utility Solutions
|
484.2
|
|
457.1
|
|
60.8
|
|
52.3
|
|
12.5
|
%
|
11.4
|
%
|
||||
TOTAL
|
$
|
1,090.3
|
|
$
|
1,087.3
|
|
$
|
118.8
|
|
$
|
120.9
|
|
10.9
|
%
|
11.1
|
%
|
|
|
March 31, 2020
|
|
December 31, 2019
|
|
||
Raw material
|
$
|
222.4
|
|
$
|
217.4
|
|
Work-in-process
|
108.2
|
|
101.8
|
|
||
Finished goods
|
355.1
|
|
403.6
|
|
||
Subtotal
|
685.7
|
|
722.8
|
|
||
Excess of FIFO over LIFO cost basis
|
(90.0
|
)
|
(89.8
|
)
|
||
TOTAL
|
$
|
595.7
|
|
$
|
633.0
|
|
|
|
Segment
|
|
|
||||||
|
Electrical
|
|
Utility Solutions
|
|
Total
|
|
|||
BALANCE DECEMBER 31, 2019
|
$
|
727.7
|
|
$
|
1,084.1
|
|
$
|
1,811.8
|
|
Prior year acquisitions
|
—
|
|
3.4
|
|
3.4
|
|
|||
Foreign currency translation
|
(4.4
|
)
|
(3.7
|
)
|
(8.1
|
)
|
|||
BALANCE MARCH 31, 2020
|
$
|
723.3
|
|
$
|
1,083.8
|
|
$
|
1,807.1
|
|
|
March 31, 2020
|
December 31, 2019
|
||||||||||
|
Gross Amount
|
|
Accumulated
Amortization
|
|
Gross Amount
|
|
Accumulated
Amortization
|
|
||||
Definite-lived:
|
|
|
|
|
|
|
|
|
||||
Patents, tradenames and trademarks
|
$
|
201.8
|
|
$
|
(66.9
|
)
|
$
|
202.7
|
|
$
|
(65.0
|
)
|
Customer relationships, developed technology and other
|
856.8
|
|
(285.8
|
)
|
861.0
|
|
(270.8
|
)
|
||||
Total
|
$
|
1,058.6
|
|
$
|
(352.7
|
)
|
$
|
1,063.7
|
|
$
|
(335.8
|
)
|
Indefinite-lived:
|
|
|
|
|
|
|
|
|
||||
Tradenames and other
|
52.9
|
|
—
|
|
53.6
|
|
—
|
|
||||
TOTAL
|
$
|
1,111.5
|
|
$
|
(352.7
|
)
|
$
|
1,117.3
|
|
$
|
(335.8
|
)
|
|
|
March 31, 2020
|
|
December 31, 2019
|
|
||
Customer program incentives
|
$
|
28.7
|
|
$
|
49.0
|
|
Accrued income taxes
|
10.8
|
|
6.0
|
|
||
Contract liabilities - deferred revenue
|
34.7
|
|
31.0
|
|
||
Customer refund liability
|
18.9
|
|
19.0
|
|
||
Accrued warranties(1)
|
24.2
|
|
24.0
|
|
||
Current operating lease liabilities
|
28.1
|
|
29.6
|
|
||
Other
|
86.9
|
|
103.6
|
|
||
TOTAL
|
$
|
232.3
|
|
$
|
262.2
|
|
|
|
March 31, 2020
|
|
December 31, 2019
|
|
||
Pensions
|
$
|
196.2
|
|
$
|
198.5
|
|
Other post-retirement benefits
|
21.5
|
|
21.5
|
|
||
Deferred tax liabilities
|
125.6
|
|
126.8
|
|
||
Accrued warranties long-term(1)
|
58.3
|
|
58.1
|
|
||
Non-current operating lease liabilities
|
70.9
|
|
71.7
|
|
||
Other
|
119.5
|
|
115.0
|
|
||
TOTAL
|
$
|
592.0
|
|
$
|
591.6
|
|
|
|
Common Stock
|
Additional
Paid-in
Capital
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Total Hubbell
Shareholders'
Equity
|
Non-
controlling
interest
|
||||||||||||
BALANCE AT DECEMBER 31, 2019
|
$
|
0.6
|
|
$
|
—
|
|
$
|
2,279.4
|
|
$
|
(332.9
|
)
|
$
|
1,947.1
|
|
$
|
13.4
|
|
Net income
|
—
|
|
—
|
|
75.0
|
|
—
|
|
75.0
|
|
0.7
|
|
||||||
Other comprehensive loss
|
—
|
|
—
|
|
—
|
|
(22.4
|
)
|
(22.4
|
)
|
—
|
|
||||||
Stock-based compensation
|
—
|
|
11.6
|
|
—
|
|
—
|
|
11.6
|
|
—
|
|
||||||
Acquisition/surrender of common shares(1)
|
—
|
|
(10.4
|
)
|
(34.1
|
)
|
—
|
|
(44.5
|
)
|
—
|
|
||||||
Cash dividends declared ($0.91 per share)
|
—
|
|
—
|
|
(49.7
|
)
|
—
|
|
(49.7
|
)
|
—
|
|
||||||
Dividends to noncontrolling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(0.5
|
)
|
||||||
Directors deferred compensation
|
—
|
|
(1.2
|
)
|
—
|
|
—
|
|
(1.2
|
)
|
—
|
|
||||||
Cumulative effect from adoption of CECL accounting standard (Note1)
|
—
|
|
—
|
|
(1.0
|
)
|
—
|
|
(1.0
|
)
|
—
|
|
||||||
BALANCE AT MARCH 31, 2020
|
$
|
0.6
|
|
$
|
—
|
|
$
|
2,269.6
|
|
$
|
(355.3
|
)
|
$
|
1,914.9
|
|
$
|
13.6
|
|
|
Common Stock
|
Additional
Paid-in
Capital
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Total Hubbell
Shareholders'
Equity
|
Non-
controlling
interest
|
||||||||||||
BALANCE AT DECEMBER 31, 2018
|
$
|
0.6
|
|
$
|
1.3
|
|
$
|
2,064.4
|
|
$
|
(285.7
|
)
|
$
|
1,780.6
|
|
$
|
18.3
|
|
Net income
|
—
|
|
—
|
|
72.3
|
|
—
|
|
72.3
|
|
1.5
|
|
||||||
Other comprehensive (loss) income
|
—
|
|
—
|
|
—
|
|
8.3
|
|
8.3
|
|
—
|
|
||||||
Stock-based compensation
|
—
|
|
4.1
|
|
—
|
|
—
|
|
4.1
|
|
—
|
|
||||||
Reclassification of stranded tax effects
|
—
|
|
—
|
|
30.0
|
|
(30.0
|
)
|
—
|
|
—
|
|
||||||
Acquisition/surrender of common shares(1)
|
—
|
|
(5.3
|
)
|
(6.3
|
)
|
—
|
|
(11.6
|
)
|
—
|
|
||||||
Cash dividends declared ($0.84 per share)
|
—
|
|
—
|
|
(45.7
|
)
|
—
|
|
(45.7
|
)
|
—
|
|
||||||
Dividends to noncontrolling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1.0
|
)
|
||||||
Directors deferred compensation
|
—
|
|
0.1
|
|
—
|
|
—
|
|
0.1
|
|
—
|
|
||||||
BALANCE AT MARCH 31, 2019
|
$
|
0.6
|
|
$
|
0.2
|
|
$
|
2,114.7
|
|
$
|
(307.4
|
)
|
$
|
1,808.1
|
|
$
|
18.8
|
|
|
(debit) credit
|
Cash flow
hedge (loss)
gain
|
Unrealized
gain (loss) on
available-for-
sale securities
|
Pension
and post
retirement
benefit plan
adjustment
|
Cumulative
translation
adjustment
|
Total
|
||||||||||
BALANCE AT DECEMBER 31, 2019
|
$
|
(0.5
|
)
|
$
|
0.6
|
|
$
|
(203.2
|
)
|
$
|
(129.8
|
)
|
$
|
(332.9
|
)
|
Other comprehensive income (loss) before reclassifications
|
1.8
|
|
(0.1
|
)
|
—
|
|
(25.6
|
)
|
(23.9
|
)
|
|||||
Amounts reclassified from accumulated other comprehensive loss
|
(0.2
|
)
|
—
|
|
1.7
|
|
—
|
|
1.5
|
|
|||||
Current period other comprehensive income (loss)
|
1.6
|
|
(0.1
|
)
|
1.7
|
|
(25.6
|
)
|
(22.4
|
)
|
|||||
BALANCE AT MARCH 31, 2020
|
$
|
1.1
|
|
$
|
0.5
|
|
$
|
(201.5
|
)
|
$
|
(155.4
|
)
|
$
|
(355.3
|
)
|
|
Three Months Ended March 31,
|
|
|||||
Details about Accumulated Other
Comprehensive Loss Components
|
2020
|
2019
|
Location of Gain (Loss) Reclassified into Income
|
||||
Cash flow hedges gain (loss):
|
|
|
|
|
|
||
Forward exchange contracts
|
$
|
0.1
|
|
$
|
0.2
|
|
Net sales
|
|
0.2
|
|
0.3
|
|
Cost of goods sold
|
||
|
0.3
|
|
0.5
|
|
Total before tax
|
||
|
(0.1
|
)
|
(0.2
|
)
|
Tax benefit (expense)
|
||
|
$
|
0.2
|
|
$
|
0.3
|
|
Gain (loss) net of tax
|
Amortization of defined benefit pension and post retirement benefit items:
|
|
|
|
|
|
||
Prior-service costs (a)
|
$
|
0.1
|
|
$
|
0.2
|
|
|
Actuarial gains/(losses) (a)
|
(2.4
|
)
|
(2.2
|
)
|
|
||
|
(2.3
|
)
|
(2.0
|
)
|
Total before tax
|
||
|
0.6
|
|
0.5
|
|
Tax benefit (expense)
|
||
|
$
|
(1.7
|
)
|
$
|
(1.5
|
)
|
Gain (loss) net of tax
|
Gains (losses) reclassified into earnings
|
$
|
(1.5
|
)
|
$
|
(1.2
|
)
|
|
(a)
|
These accumulated other comprehensive loss components are included in the computation of net periodic pension cost (see Note 11 – Pension and Other Benefits in the Notes to Condensed Consolidated Financial Statements for additional details).
|
|
|
Three Months Ended March 31,
|
|||||
|
2020
|
|
2019
|
|
||
Numerator:
|
|
|
|
|
||
Net income attributable to Hubbell Incorporated
|
$
|
75.0
|
|
$
|
72.3
|
|
Less: Earnings allocated to participating securities
|
(0.3
|
)
|
(0.3
|
)
|
||
Net income available to common shareholders
|
$
|
74.7
|
|
$
|
72.0
|
|
Denominator:
|
|
|
|
|
||
Average number of common shares outstanding
|
54.3
|
|
54.4
|
|
||
Potential dilutive common shares
|
0.3
|
|
0.2
|
|
||
Average number of diluted shares outstanding
|
54.6
|
|
54.6
|
|
||
Earnings per share:
|
|
|
|
|
||
Basic
|
$
|
1.38
|
|
$
|
1.32
|
|
Diluted
|
$
|
1.37
|
|
$
|
1.32
|
|
|
|
Pension Benefits
|
Other Benefits
|
||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
||||
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
||||
Service cost
|
$
|
0.3
|
|
$
|
0.5
|
|
$
|
—
|
|
$
|
—
|
|
Interest cost
|
7.2
|
|
8.7
|
|
0.2
|
|
0.3
|
|
||||
Expected return on plan assets
|
(8.5
|
)
|
(7.6
|
)
|
—
|
|
—
|
|
||||
Amortization of prior service cost
|
—
|
|
—
|
|
(0.1
|
)
|
(0.2
|
)
|
||||
Amortization of actuarial losses
|
2.4
|
|
2.2
|
|
—
|
|
—
|
|
||||
NET PERIODIC BENEFIT COST
|
$
|
1.4
|
|
$
|
3.8
|
|
$
|
0.1
|
|
$
|
0.1
|
|
|
|
2020
|
2019
|
||||
BALANCE AT JANUARY 1, (a)
|
$
|
82.1
|
|
$
|
92.7
|
|
Provision
|
4.6
|
|
3.5
|
|
||
Expenditures/payments/other
|
(4.2
|
)
|
(12.0
|
)
|
||
BALANCE AT MARCH 31, (a)
|
$
|
82.5
|
|
$
|
84.2
|
|
|
Asset (Liability)
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Quoted Prices in
Active Markets for
Similar Assets
(Level 2)
|
Unobservable inputs
for which little or no
market data exists
(Level 3)
|
Total
|
|
|||||||
March 31, 2020
|
|
|
|
|
||||||||
Money market funds(a)
|
$
|
159.4
|
|
$
|
—
|
|
$
|
—
|
|
$
|
159.4
|
|
Available for sale investments
|
—
|
|
48.5
|
|
—
|
|
48.5
|
|
||||
Trading securities
|
18.1
|
|
—
|
|
—
|
|
18.1
|
|
||||
Deferred compensation plan liabilities
|
(18.1
|
)
|
—
|
|
—
|
|
(18.1
|
)
|
||||
Derivatives:
|
|
|
|
|
||||||||
Forward exchange contracts-Assets(b)
|
—
|
|
1.9
|
|
—
|
|
1.9
|
|
||||
TOTAL
|
$
|
159.4
|
|
$
|
50.4
|
|
$
|
—
|
|
$
|
209.8
|
|
|
|
|
|
|
||||||||
Asset (Liability)
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Quoted Prices in
Active Markets for
Similar Assets
(Level 2)
|
Unobservable inputs
for which little or no
market data exists
(Level 3)
|
Total
|
|
|||||||
December 31, 2019
|
|
|
|
|
||||||||
Money market funds(a)
|
$
|
27.5
|
|
$
|
—
|
|
$
|
—
|
|
$
|
27.5
|
|
Available for sale investments
|
—
|
|
50.7
|
|
—
|
|
50.7
|
|
||||
Trading securities
|
19.2
|
|
—
|
|
—
|
|
19.2
|
|
||||
Deferred compensation plan liabilities
|
(19.2
|
)
|
—
|
|
—
|
|
(19.2
|
)
|
||||
Derivatives:
|
|
|
|
|
||||||||
Forward exchange contracts-(Liabilities)(c)
|
—
|
|
(0.3
|
)
|
—
|
|
(0.3
|
)
|
||||
TOTAL
|
$
|
27.5
|
|
$
|
50.4
|
|
$
|
—
|
|
$
|
77.9
|
|
|
|
|
Three Months Ended March 31,
|
|||||||||||||||||
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
||||||||||||
|
Cost of goods sold
|
Selling & administrative expense
|
Total
|
|||||||||||||||
Electrical
|
$
|
0.5
|
|
$
|
0.2
|
|
$
|
0.4
|
|
$
|
1.0
|
|
$
|
0.9
|
|
$
|
1.2
|
|
Utility Solutions
|
2.5
|
|
0.5
|
|
0.1
|
|
1.3
|
|
2.6
|
|
1.8
|
|
||||||
Total Pre-Tax Restructuring Costs
|
$
|
3.0
|
|
$
|
0.7
|
|
$
|
0.5
|
|
$
|
2.3
|
|
$
|
3.5
|
|
$
|
3.0
|
|
|
Beginning Accrued Restructuring Balance 1/1/20
|
|
Pre-tax Restructuring Costs
|
|
Utilization and Foreign Exchange
|
|
Ending Accrued Restructuring Balance 3/31/2020
|
|
||||
2020 Restructuring Actions
|
|
|
|
|
||||||||
Severance
|
$
|
—
|
|
$
|
1.1
|
|
$
|
(0.3
|
)
|
$
|
0.8
|
|
Asset write-downs
|
—
|
|
—
|
|
—
|
|
—
|
|
||||
Facility closure and other costs
|
—
|
|
0.1
|
|
(0.1
|
)
|
—
|
|
||||
Total 2020 Restructuring Actions
|
$
|
—
|
|
$
|
1.2
|
|
$
|
(0.4
|
)
|
$
|
0.8
|
|
2019 and Prior Restructuring Actions
|
|
|
|
|
||||||||
Severance
|
$
|
11.3
|
|
$
|
(0.6
|
)
|
$
|
(4.0
|
)
|
$
|
6.7
|
|
Asset write-downs
|
—
|
|
0.1
|
|
(0.1
|
)
|
—
|
|
||||
Facility closure and other costs
|
6.1
|
|
2.8
|
|
(2.8
|
)
|
6.1
|
|
||||
Total 2019 and Prior Restructuring Actions
|
$
|
17.4
|
|
$
|
2.3
|
|
$
|
(6.9
|
)
|
$
|
12.8
|
|
Total Restructuring Actions
|
$
|
17.4
|
|
$
|
3.5
|
|
$
|
(7.3
|
)
|
$
|
13.6
|
|
|
Total expected costs
|
|
Costs incurred during 2019
|
|
Costs incurred in the first three months of 2020
|
|
Remaining costs at 3/31/2020
|
|
||||
2020 Restructuring Actions
|
|
|
|
|
||||||||
Electrical
|
$
|
1.4
|
|
$
|
—
|
|
$
|
0.9
|
|
$
|
0.5
|
|
Utility Solutions
|
0.3
|
|
—
|
|
0.3
|
|
—
|
|
||||
Total 2020 Restructuring Actions
|
$
|
1.7
|
|
$
|
—
|
|
$
|
1.2
|
|
$
|
0.5
|
|
2019 and Prior Restructuring Actions
|
|
|
|
|
||||||||
Electrical
|
$
|
22.1
|
|
$
|
20.5
|
|
$
|
—
|
|
$
|
1.6
|
|
Utility Solutions
|
21.3
|
|
11.5
|
|
2.3
|
|
7.5
|
|
||||
Total 2019 and Prior Restructuring Actions
|
$
|
43.4
|
|
$
|
32.0
|
|
$
|
2.3
|
|
$
|
9.1
|
|
Total Restructuring Actions
|
$
|
45.1
|
|
$
|
32.0
|
|
$
|
3.5
|
|
$
|
9.6
|
|
|
|
Maturity
|
March 31, 2020
|
|
December 31, 2019
|
|
||
Senior notes at 3.625%
|
2022
|
$
|
298.9
|
|
$
|
298.8
|
|
Senior notes at 3.35%
|
2026
|
395.9
|
|
395.7
|
|
||
Senior notes at 3.15%
|
2027
|
296.0
|
|
295.9
|
|
||
Senior notes at 3.50%
|
2028
|
444.3
|
|
444.0
|
|
||
Term loan, net of current portion of $37.5 and $34.4, respectively
|
2023
|
62.2
|
|
71.6
|
|
||
2018 Credit Facility
|
2023
|
100.0
|
|
—
|
|
||
TOTAL LONG-TERM DEBT(a)
|
|
$
|
1,597.3
|
|
$
|
1,506.0
|
|
|
Grant Date
|
Expected Dividend Yield
|
Expected Volatility
|
Risk Free Interest Rate
|
Expected Term
|
Weighted Avg. Grant Date Fair Value of 1 SAR
|
February 2020
|
2.5%
|
23.2%
|
1.5%
|
5.5 Years
|
$25.28
|
Grant Date
|
Fair Value
|
Performance Period
|
Payout Range
|
||
February 2020
|
$143.45
|
Jan 2020-Dec 2022
|
0-200% +/- 20%
|
ITEM 2
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
|
Three Months Ended March 31,
|
|||||||||
|
2020
|
|
% of Net sales
|
|
2019
|
|
% of Net sales
|
|
||
Net sales
|
$
|
1,090.3
|
|
|
|
$
|
1,087.3
|
|
|
|
Cost of goods sold
|
776.8
|
|
71.2
|
%
|
780.0
|
|
71.7
|
%
|
||
Gross profit
|
313.5
|
|
28.8
|
%
|
307.3
|
|
28.3
|
%
|
||
Selling & administrative ("S&A") expense
|
194.7
|
|
17.9
|
%
|
186.4
|
|
17.1
|
%
|
||
Operating income
|
118.8
|
|
10.9
|
%
|
120.9
|
|
11.1
|
%
|
||
Net income attributable to Hubbell Incorporated
|
75.0
|
|
6.9
|
%
|
72.3
|
|
6.6
|
%
|
||
EARNINGS PER SHARE – DILUTED
|
$
|
1.37
|
|
|
|
$
|
1.32
|
|
|
|
|
Three Months Ended March 31,
|
|||||||||
|
2020
|
|
% of Net sales
|
2019
|
|
% of Net sales
|
||||
Gross profit (GAAP measure)
|
$
|
313.5
|
|
28.8
|
%
|
$
|
307.3
|
|
28.3
|
%
|
Amortization of acquisition-related intangible assets
|
6.9
|
|
|
6.1
|
|
|
||||
Adjusted gross profit
|
$
|
320.4
|
|
29.4
|
%
|
$
|
313.4
|
|
28.8
|
%
|
S&A expenses (GAAP measure)
|
$
|
194.7
|
|
17.9
|
%
|
$
|
186.4
|
|
17.1
|
%
|
Amortization of acquisition-related intangible assets
|
12.6
|
|
|
12.1
|
|
|
||||
Adjusted S&A expenses
|
$
|
182.1
|
|
16.7
|
%
|
$
|
174.3
|
|
16.0
|
%
|
Operating income (GAAP measure)
|
$
|
118.8
|
|
10.9
|
%
|
$
|
120.9
|
|
11.1
|
%
|
Amortization of acquisition-related intangible assets
|
19.5
|
|
|
18.2
|
|
|
||||
Adjusted operating income
|
$
|
138.3
|
|
12.7
|
%
|
$
|
139.1
|
|
12.8
|
%
|
Net income attributable to Hubbell Incorporated (GAAP measure)
|
$
|
75.0
|
|
|
$
|
72.3
|
|
|
||
Amortization of acquisition-related intangible assets, net of tax
|
14.6
|
|
|
13.6
|
|
|
||||
Adjusted net income attributable to Hubbell Incorporated
|
$
|
89.6
|
|
|
$
|
85.9
|
|
|
||
Less: Earnings allocated to participating securities
|
(0.3
|
)
|
|
(0.3
|
)
|
|
||||
Adjusted net income available to common shareholders
|
$
|
89.3
|
|
|
$
|
85.6
|
|
|
||
Average number of diluted shares outstanding
|
54.6
|
|
|
54.6
|
|
|
||||
ADJUSTED EARNINGS PER SHARE – DILUTED
|
$
|
1.64
|
|
|
|
$
|
1.57
|
|
|
|
|
Three Months Ended March 31,
|
|||||
(In millions)
|
2020
|
|
2019
|
|
||
Net sales
|
$
|
606.1
|
|
$
|
630.2
|
|
Operating income (GAAP measure)
|
58.0
|
|
68.6
|
|
||
Amortization of acquisition-related intangible assets
|
6.4
|
|
5.7
|
|
||
Adjusted operating income
|
$
|
64.4
|
|
$
|
74.3
|
|
Operating margin (GAAP measure)
|
9.6
|
%
|
10.9
|
%
|
||
Adjusted operating margin
|
10.6
|
%
|
11.8
|
%
|
|
Three Months Ended March 31,
|
|||||
(In millions)
|
2020
|
|
2019
|
|
||
Net sales
|
$
|
484.2
|
|
$
|
457.1
|
|
Operating income (GAAP measure)
|
60.8
|
|
52.3
|
|
||
Amortization of acquisition-related intangible assets
|
13.1
|
|
12.5
|
|
||
Adjusted operating income
|
$
|
73.9
|
|
$
|
64.8
|
|
Operating margin (GAAP measure)
|
12.5
|
%
|
11.4
|
%
|
||
Adjusted operating margin
|
15.3
|
%
|
14.2
|
%
|
|
|
Three Months Ended March 31
|
|||||
(In millions)
|
2020
|
|
2019
|
|
||
Net cash provided by (used in):
|
|
|
|
|
||
Operating activities
|
$
|
108.4
|
|
$
|
78.1
|
|
Investing activities
|
(15.6
|
)
|
(20.1
|
)
|
||
Financing activities
|
35.7
|
|
(43.7
|
)
|
||
Effect of foreign currency exchange rate changes on cash and cash equivalents
|
(10.5
|
)
|
2.0
|
|
||
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
$
|
118.0
|
|
$
|
16.3
|
|
|
Costs incurred in the three months ended
March 31, 2020
|
|
Additional expected costs
|
|
Expected completion date
|
||
2020 Restructuring Actions
|
$
|
1.2
|
|
$
|
0.5
|
|
2021
|
2019 and Prior Restructuring Actions
|
2.3
|
|
9.1
|
|
2020
|
||
Total Restructuring cost (GAAP measure)
|
$
|
3.5
|
|
$
|
9.6
|
|
|
Restructuring-related costs
|
2.1
|
|
1.2
|
|
|
||
Restructuring and related costs (Non-GAAP)
|
$
|
5.6
|
|
$
|
10.8
|
|
|
◦
|
$65.0 million of commercial paper borrowings outstanding at March 31, 2020 and $26.0 million of commercial paper borrowings outstanding at December 31, 2019.
|
◦
|
$37.5 million at March 31, 2020 and $34.4 million at December 31, 2019, respectively, of long-term debt classified as short-term within current liabilities in the Condensed Consolidated Balance Sheets, reflecting amortization within the next 12 months under the Term Loan Agreement.
|
◦
|
$4.2 million at March 31, 2020 and $5.0 million at December 31, 2019, respectively, of borrowings to support our international operations in China.
|
(In millions)
|
March 31, 2020
|
|
December 31, 2019
|
|
||
Total Debt
|
$
|
1,704.0
|
|
$
|
1,571.4
|
|
Total Hubbell Incorporated Shareholders’ Equity
|
1,914.9
|
|
1,947.1
|
|
||
TOTAL CAPITAL
|
$
|
3,618.9
|
|
$
|
3,518.5
|
|
Total Debt to Total Capital
|
47
|
%
|
45
|
%
|
||
Cash and Investments
|
366.7
|
|
251.9
|
|
||
Net Debt
|
$
|
1,337.3
|
|
$
|
1,319.5
|
|
Net Debt to Total Capital
|
37
|
%
|
38
|
%
|
◦
|
Cash flows from operating activities and existing cash resources: In addition to cash flows from operating activities, we also had $300.0 million of cash and cash equivalents at March 31, 2020, of which approximately 48% was held inside the United States and the remainder held internationally. Approximately $100 million of this liquidity held as of March 31, 2020 was provided by our recent borrowing under the 2018 Credit Agreement as described above and below.
|
◦
|
Our 2018 Credit Facility provides a $750 million committed revolving credit facility and commitments under the 2018 Credit Facility may be increased (subject to certain conditions) to an aggregate amount not to exceed $1.250 billion. Annual commitment fees to support availability under the 2018 Credit Facility are not material. Although not the principal source of liquidity, we believe our 2018 Credit Facility is capable of providing significant financing flexibility at reasonable rates of interest and is an attractive alternative source of funding in the event that commercial paper markets experience disruption, such as the recent disruption in that market due to general liquidity concerns associated with the recent economic downturn. However, an increase in usage of the 2018 Credit Facility related to growth or a significant deterioration in the results of our operations or cash flows, could cause our borrowing costs to increase and/or our ability to borrow could be restricted. We have not entered into any guarantees that could give rise to material unexpected cash requirements.
|
◦
|
In addition to our commercial paper program and existing revolving credit facility, we also have the ability to obtain additional financing through the issuance of long-term debt. Considering our current credit rating, historical earnings performance, and financial position, we believe that we would be able to obtain additional long-term debt financing on attractive terms.
|
|
|
•
|
The scope and duration of the novel coronavirus, or COVID-19, global pandemic and its impact on global economic systems, our employees, sites, operations, customers, and supply chain.
|
•
|
Changes in demand for our products, market conditions, product quality, or product availability adversely affecting sales levels.
|
•
|
Changes in markets or competition adversely affecting realization of price increases.
|
•
|
Failure to achieve projected levels of efficiencies, cost savings and cost reduction measures, including those expected as a result of our lean initiatives and strategic sourcing plans.
|
•
|
Impacts of trade tariffs, import quotas or other trade restrictions or measures taken by the U.S., U.K. and other countries.
|
•
|
Availability and costs of raw materials, purchased components, energy and freight.
|
•
|
Changes in expected or future levels of operating cash flow, indebtedness and capital spending.
|
•
|
General economic and business conditions in particular industries, markets or geographic regions, as well as inflationary trends.
|
•
|
Regulatory issues, changes in tax laws including the TCJA, or changes in geographic profit mix affecting tax rates and availability of tax incentives.
|
•
|
A major disruption in one or more of our manufacturing or distribution facilities or headquarters, including the impact of plant consolidations and relocations.
|
•
|
Changes in our relationships with, or the financial condition or performance of, key distributors and other customers, agents or business partners which could adversely affect our results of operations.
|
•
|
Impact of productivity improvements on lead times, quality and delivery of product.
|
•
|
Anticipated future contributions and assumptions including changes in interest rates and plan assets with respect to pensions and other retirement benefits, as well as pension withdrawal liabilities.
|
•
|
Adjustments to product warranty accruals in response to claims incurred, historical experiences and known costs.
|
•
|
Unexpected costs or charges, certain of which might be outside of our control.
|
•
|
Changes in strategy, economic conditions or other conditions outside of our control affecting anticipated future global product sourcing levels.
|
•
|
Ability to carry out future acquisitions and strategic investments in our core businesses as well as the acquisition related costs.
|
•
|
Ability to successfully execute, manage and integrate key acquisitions, mergers, and other transactions.
|
•
|
The ability to effectively implement Enterprise Resource Planning systems without disrupting operational and financial processes.
|
•
|
Unanticipated difficulties integrating acquisitions as well as the realization of expected synergies and benefits anticipated when we make an acquisition.
|
•
|
The ability of government customers to meet their financial obligations.
|
•
|
Political unrest in foreign countries.
|
•
|
The impact of Brexit and other world economic and political issues.
|
•
|
The impact of natural disasters or public health emergencies, such as the COVID-19 global pandemic, on our financial condition and results of operations.
|
•
|
Failure of information technology systems or security breaches resulting in unauthorized disclosure of confidential information.
|
•
|
Future revisions to or clarifications of the TCJA.
|
•
|
Future repurchases of common stock under our common stock repurchase program.
|
•
|
Changes in accounting principles, interpretations, or estimates.
|
•
|
The outcome of environmental, legal and tax contingencies or costs compared to amounts provided for such contingencies, including contingencies or costs with respect to pension withdrawal liabilities.
|
•
|
Adverse changes in foreign currency exchange rates and the potential use of hedging instruments to hedge the exposure to fluctuating rates of foreign currency exchange on inventory purchases.
|
•
|
Transitioning from LIBOR to a replacement alternative reference rate.
|
•
|
Other factors described in our Securities and Exchange Commission filings, including the “Business”, “Risk Factors” and “Quantitative and Qualitative Disclosures about Market Risk” sections in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 and in the Company's Quarterly Reports on Form 10-Q.
|
ITEM 3
|
Quantitative and Qualitative Disclosures About Market Risk
|
ITEM 4
|
Controls and Procedures
|
PART II
|
OTHER INFORMATION
|
ITEM 1A
|
Risk Factors
|
ITEM 2
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
|
Total Number of Shares of Common Stock Purchased (a)
|
|
Average Price Paid per share of Common Stock
|
|
Approximate Value of Shares that May Yet Be Purchased Under
the Programs
|
|
||
Period
|
(000’s)
|
|
Share
|
|
(in millions)
|
|
||
BALANCE AS OF DECEMBER 31, 2019
|
|
|
|
|
$
|
325.0
|
|
|
January 2020
|
—
|
|
$
|
—
|
|
$
|
325.0
|
|
February 2020
|
107
|
|
$
|
142.56
|
|
$
|
309.7
|
|
March 2020
|
214
|
|
$
|
121.56
|
|
$
|
283.7
|
|
TOTAL FOR THE QUARTER ENDED MARCH 31, 2020
|
321
|
|
$
|
128.56
|
|
|
|
ITEM 6
|
Exhibits
|
|
|
Incorporated by Reference
|
|
|
||
Exhibit
Number
|
Exhibit Description
|
Form
|
File No.
|
Exhibit
|
Filing
Date
|
Filed/
Furnished
Herewith
|
31.1
|
|
|
|
|
*
|
|
31.2
|
|
|
|
|
*
|
|
32.1
|
|
|
|
|
**
|
|
32.2
|
|
|
|
|
**
|
|
101.INS
|
Inline XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document
|
|
|
|
|
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema Document
|
|
|
|
|
*
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
*
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
*
|
101.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
*
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
*
|
104
|
The cover page of this Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, formatted in Inline XBRL (included within the Exhibit 101 attachments)
|
|
|
|
|
*
|
*
|
Filed herewith
|
**
|
Furnished herewith
|
HUBBELL INCORPORATED
|
|
|
|
|
|
|
|
|
|
By
|
/s/ William R. Sperry
|
By
|
/s/ Joseph A. Capozzoli
|
|
|
William R. Sperry
|
|
Joseph A. Capozzoli
|
|
|
Executive Vice President, Chief Financial Officer and Treasurer
|
|
Vice President, Controller (Principal Accounting Officer)
|
|
1 Year Hubbell Chart |
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