Belden announces its intent to divest Grass Valley
Belden, global supplier of specialty networking solutions, today has announced its decision to divest its Live Media business (“Grass Valley”). This decision is related with its fiscal third quarter 2019 results for the period ended September 29, 2019.
Revenues for the quarter totaled $620.3 million, decreasing $35.5 million, or 5.4%, compared to $655.8 million in the third quarter 2018. Net loss was $(297.0) million, compared to $85.9 million in the prior-year period. Net loss included a $337.0 million after-tax non-cash impairment charge related to Grass Valley. EPS totaled $(6.70) compared to $1.80 in the third quarter 2018.
Excluding Grass Valley, adjusted revenues totaled $533.1 million, decreasing $20.9 million, or 3.8%, compared to $554.0 million in the third quarter 2018. Excluding Grass Valley, adjusted EPS was $1.18 compared to $1.29 in the third quarter 2018. Adjusted results are non-GAAP measures, and a non-GAAP reconciliation table is provided as an appendix to this release.
John Stroup, President, CEO, and Chairman of Belden Inc., said, “Revenues were near the midpoint of our expected range excluding Grass Valley. Consistent with our expectations, demand trends remained softer in some of our key Industrial markets in the third quarter, but we are encouraged by the improving trends in our Broadband business.”
Subsequent to the end of the third quarter, the Company made the decision to pursue the divestiture of Grass Valley. Based on the approval of Belden’s Board of Directors to divest this business and the probability that such divestiture will be consummated, Grass Valley’s financial results will be presented as discontinued operations in the fourth quarter and full year 2019 financial statements and prior periods will be recast for consistency.
Mr. Stroup remarked, “We completed a rigorous strategic review of our portfolio of businesses, and today’s announcement marks an important outcome. We concluded that it is in the best interests of our shareholders, customers, and employees to separate Grass Valley from Belden. This will enable Grass Valley to more effectively execute its strategic plan and pursue growth opportunities. Further, this separation will simplify Belden’s portfolio and improve organic growth and revenue visibility.”
