GLENVIEW, Ill., Sept. 23 /PRNewswire-FirstCall/ -- Anixter International Inc. (NYSE: AXE), a leading global distributor of communication and security products, electrical and electronic wire & cable, fasteners and other small parts, today announced that its Board of Directors declared the payment of a special dividend of $3.25 per common share, or a total cash outlay of approximately $110 million. The special dividend is payable on October 28, 2010 to shareholders of record on October 15, 2010.
Commenting on the special dividend payment, President and CEO Robert Eck, said, "Over the course of the last 18 months, we successfully navigated through one of the most serious economic recessions that our company has ever experienced. During this time, we were not only able to maintain a solid level of profitability, but also generated record levels of cash flow. In the company's last six quarters we generated $520 million in free cash flow, or $14.77 per share, while using $330 million of this cash to reduce outstanding debt. The substantial de-leveraging of our balance sheet resulted in a debt to total capital ratio of 43.1 percent at quarter end, which falls below our target range of 45-50 percent. This presented us with the opportunity to return capital to our shareholders while still maintaining ample resources to support foreseeable growth."
"As we assess our current capital structure and how to best deploy excess capital available to the company, we have concluded that significant further de-leveraging would not be a good use of cash at this time," continued Eck. "In addition, we ended the most recent quarter with significant excess liquidity of more than $400 million. While we continue to look for strategic acquisitions that can profitably grow our business, we will only enter into those transactions when both the strategic fit and the acquisition price make sense. The amount of cash used in this dividend payment does not preclude our ability to make future acquisitions."
"We believe a special dividend payment of this amount benefits all current shareholders. Not only do our shareholders receive a direct cash benefit, but the Company's investment profile remains unchanged. By making this payment in the form of a special dividend rather than committing to a regular dividend payment, the Company maintains the flexibility to utilize future cash flows to invest in the growth of the business as the recovery further improves," continued Eck.
"The management team, working closely with the Board of Directors, has analyzed a variety of alternatives to improve shareholder returns. We think this dividend is a prudent way for all shareholders to participate in our successes while preserving an appropriately flexible capital structure that will allow them to participate in the future growth of the business," concluded Eck.
Anixter International is a leading global distributor of communication and security products, electrical and electronic wire & cable, fasteners and other small parts. The company adds value to the distribution process by providing its customers access to 1) innovative inventory management programs, 2) more than 450,000 products and over $900 million in inventory, 3) 219 warehouses with approximately 7 million square feet of space, and 4) locations in 262 cities in 50 countries. Founded in 1957 and headquartered near Chicago, Anixter trades on the New York Stock Exchange under the symbol AXE.
Safe Harbor Statement
The statements in this news release that use such words as "believe," "expect," "intend," "anticipate," "contemplate," "estimate," "plan," "project," "should," "may," "will," or similar expressions are forward-looking statements. They are subject to a number of factors that could cause the company's actual results to differ materially from what is indicated here. These factors include general economic conditions, including the severity of current economic and financial market conditions, the level of customer demand particularly for capital projects in the markets we serve, changes in supplier sales strategies or financial viability, political, economic or currency risks related to foreign operations, inventory obsolescence, copper price fluctuations, customer viability, risks associated with accounts receivable, the impact of regulation and regulatory, investigative and legal proceedings and legal compliance risks, potential impairment of goodwill and risks associated with integration of acquired companies. These uncertainties may cause our actual results to be materially different than those expressed in any forward looking statements. We do not undertake to update any forward looking statements. Please see the company's Securities and Exchange Commission filings for more information.
Additional information about Anixter is available on the Internet at
SOURCE Anixter International Inc.