The latest financial results from (TICKER) have shown promising growth, with first-quarter revenue reaching $152.24 million, surpassing the consensus estimate of $147.93 million. This positive outcome was primarily driven by the company's strategic positioning in the defense and commercial aerospace sectors, alongside strong performance in the emerging AI market.
CEO Daniel Bernstein expressed satisfaction with the quarterly results, noting that these factors helped counteract typical seasonal challenges such as those experienced during the Chinese New Year. Looking ahead, Bernstein anticipates continued robust demand in the defense, space, and AI markets throughout the year, which is expected to balance out softer volumes in the rail, e-Mobility, and consumer sectors.
CFO Farouq Tuweiq highlighted the dynamic nature of the current operating environment and the challenges posed by unpredictable tariff changes. He noted that approximately 75% of global sales are currently unaffected by new U.S. tariffs. However, around 10% of consolidated sales involve goods manufactured in China and shipped to the U.S., an area where some customers have paused orders due to uncertainty in tariff policies.
For the second quarter of 2025, (TICKER) projects GAAP net sales to be between $145 million and $155 million, with an anticipated gross margin range of 37% to 39%. This forecast has been adjusted downward to accommodate an expected tariff impact potentially affecting $8 million to $10 million of revenue, alongside a projected decrease in intraquarter turns. The company remains vigilant in monitoring tariff developments and exploring manageable alternatives.
BELFA Key Business Developments
Release Date: February 19, 2025
- Revenue (Q4 2024): $149.9 million, up from $140 million in Q4 2023.
- Full Year Revenue (2024): $535 million, down from $640 million in 2023.
- Gross Margin (Q4 2024): 37.5%, up from 36.6% in Q4 2023.
- Full Year Gross Margin (2024): Increased by 410 basis points compared to 2023.
- Power Solutions and Protection Products Sales (Q4 2024): $78.1 million, a 13.2% increase from Q4 2023.
- Connectivity Solutions Sales (Q4 2024): $52.5 million, a 4% increase from Q4 2023.
- Magnetic Solutions Sales (Q4 2024): $19.2 million, a 6% decline from Q4 2023.
- SG&A Expenses (Q4 2024): $34.8 million, up by $9.9 million from Q4 2023.
- Cash and Securities (End of 2024): $69 million, down from $127 million at the end of 2023.
- Debt (End of 2024): $287.5 million, largely due to $240 million new debt for Enercon acquisition.
- Enercon Revenue Contribution (2024): $20.8 million for two months.
- Backlog of Orders (End of 2024): $382 million, with $263 million from Legacy Bel and $119 million from Enercon.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Bel Fuse Inc (BELFA, Financial) achieved a 410 basis points improvement in gross margin for the full year 2024 compared to 2023.
- The company completed the acquisition of Enercon, the largest transaction in its history, contributing positively to sales and growth.
- Bel Fuse Inc (BELFA) realized cost savings of $1.5 million in 2024, with more expected in 2025 due to facility consolidations.
- The company has successfully implemented six facility consolidations globally over the past three years, resulting in annual cost savings of $11.8 million.
- The connectivity solutions group saw a 4% increase in sales during Q4 2024 compared to Q4 2023, driven by growth in defense and aerospace industries.
Negative Points
- Sales for the full year 2024 decreased to $535 million from $640 million in 2023, reflecting a 16% reduction.
- The power segment experienced a 21.8% decline in sales for the full year 2024 compared to 2023, primarily due to lower sales of front-end and board mount power products.
- The magnetic solutions group saw a 6% decline in sales in Q4 2024 compared to Q4 2023, with full-year sales dropping significantly.
- The company faces challenges in the consumer market due to US government trading restrictions on a supplier in the PRC, impacting year-over-year comparisons.
- An additional 10% tariff on imports from China, effective February 2025, increases the total tariff to 35%, potentially impacting financials despite efforts to pass costs to customers.
