Belden Expands Margins as Organic Growth Accelerates
Orders reached a record $836 million, lifting book-to-bill to 1.11.
Belden Inc. (BDC), the network infrastructure and industrial automation supplier, increased adjusted EBITDA 28% as stronger organic growth and wider margins defined its second quarter.
Revenue reached a record $750 million, up 12% from a year earlier and 7.7% from the first quarter. Organic growth accelerated to 8% from 7% in the prior quarter and 5% in the fourth quarter of 2024.
GAAP earnings rose 14% to $1.74 a share, while adjusted earnings increased 24% to $2.34 a share. The adjusted result exceeded the top of Belden’s guidance by $0.29, and revenue finished at the top of its projected range.
Adjusted EBITDA climbed to $146 million, outpacing revenue growth, and the adjusted EBITDA margin expanded 250 basis points to 19.5%. The margin had held at 17.0% in each of the previous four reported quarters. Adjusted gross margin also increased, reaching 39.6% from 38.9% a year earlier.
Organic demand supplied most of the revenue gain, with copper pass-through pricing adding 3 percentage points and foreign currency adding 1 point. Acquisitions made no contribution because Belden completed its approximately $1.85 billion purchase of RUCKUS Networks on July 1, after the quarter ended.
Order growth accelerated to 19% from 16% in the year-earlier quarter, providing a stronger backlog signal as RUCKUS joined the company. Belden’s new single-segment reporting model, however, no longer provides the separate organic-growth figures previously disclosed for Automation Solutions and Smart Infrastructure Solutions.
Belden’s third-quarter guidance, which includes RUCKUS, calls for revenue of $950 million to $970 million and adjusted earnings of $2.15 to $2.30 a share. The company also expects a net benefit of about $0.25 a share from the recovery of IEEPA tariffs, partly offset by newly introduced tariffs.
Operating cash flow rose 58% to $129.2 million, while free cash flow increased 56% despite higher capital spending. That cash generation gave Belden additional capacity as it began integrating its largest recent acquisition.