Item 5. Market for Registrant’s Common Equity
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our ordinary shares trade on the New York Stock Exchange under the symbol "ST."
Performance Graph
The following graph compares the total shareholder return of our ordinary shares since December 31, 2015 to the total shareholder return since that date of the Standard & Poor’s ("S&P") 500 Stock Index and the S&P 500 Industrial Index. The graph assumes that the value of the investment in our ordinary shares and each index was $100.00 on December 31, 2015.
Total Shareholder Return of $100.00 Investment from December 31, 2015
As of December 31,
2015 2016 2017 2018 2019 2020
Sensata $ 100.00 $ 84.56 $ 110.96 $ 97.35 $ 116.96 $ 114.50
S&P 500
$ 100.00 $ 111.96 $ 136.40 $ 130.42 $ 171.49 $ 203.04
S&P 500 Industrial
$ 100.00 $ 116.08 $ 137.60 $ 116.96 $ 148.34 $ 161.70
The information in the graph and table above is not "soliciting material," is not deemed "filed" with the United States (the "U.S.") Securities and Exchange Commission, and is not to be incorporated by reference in any of our filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Annual Report on Form 10-K (this "Report"), except to the extent that we specifically incorporate such information by reference. The total shareholder return shown on the graph represents past performance and should not be considered an indication of future price performance.
Stockholders
As of January 29, 2021, there were three holders of record of our ordinary shares, primarily Cede & Co. (which acts as nominee shareholder for the Depository Trust Company).
Dividends
We have never declared or paid any dividends on our ordinary shares, and we currently do not plan to declare any such dividends in the foreseeable future. Because we are a holding company, our ability to pay cash dividends on our ordinary shares may be limited by restrictions on our ability to obtain sufficient funds through dividends from our subsidiaries, including
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restrictions under the terms of the agreements governing our indebtedness. In that regard, our indirect, wholly-owned subsidiary, Sensata Technologies B.V. ("STBV"), may be limited in its ability to pay dividends or otherwise make distributions to its immediate parent company and, ultimately, to us. Refer to Note 14, "Debt," of our audited consolidated financial statements and accompanying notes thereto (our "Financial Statements") included elsewhere in this Report for additional information related to our dividend restrictions.
Additionally, certain of our subsidiaries may be limited in their ability to pay dividends or make other distributions to the extent that the shareholders' equity of such subsidiary exceeds the reserves required to be maintained by law or under its articles of association. Under the laws of England and Wales, we are able to declare dividends, make distributions, or repurchase shares only out of distributable reserves on our statutory balance sheet. Distributable reserves are a company’s accumulated, realized profits, so far as not previously utilized by distribution or capitalization, less its accumulated, realized losses, so far as not previously written off in a reduction or reorganization of capital duly made. Realized reserves are determined in accordance with generally accepted accounting principles at the time the relevant accounts are prepared. We are not permitted to make a distribution if, at the time, the amount of our net assets is less than the aggregate of our issued and paid-up share capital and undistributable reserves or to the extent that the distribution will reduce our net assets below such amount. Subject to these limitations, the payment of cash dividends in the future, if any, will depend upon such factors as earnings levels, capital requirements, contractual restrictions, our overall financial condition, and any other factors deemed relevant by our shareholders and Board of Directors.
Under current United Kingdom ("U.K.") tax legislation, any future dividends paid by us will not be subject to withholding or deduction on account of U.K. tax, irrespective of the tax residence or the individual circumstances of the recipient shareholder. Shareholders should consult their tax advisors regarding their particular tax situation and the income tax consequences on any potential dividend income received from us.
Issuer Purchases of Equity Securities
Period Total Number of Shares Purchased
(in shares) (1)
Weighted-Average
Price
Paid per Share Total Number of
Shares Purchased as Part of Publicly
Announced Plan or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan or Programs
(in millions)
October 1 through October 31, 2020 — $ — — $ 302.3
November 1 through November 30, 2020 10,499 $ 43.71 — $ 302.3
December 1 through December 31, 2020 2,301 $ 50.97 — $ 302.3
Quarter total 12,800 $ 45.02 — $ 302.3
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(1) The number of ordinary shares presented were withheld upon the vesting of restricted securities to cover payment of employee withholding tax. These withholdings took place outside of a publicly announced repurchase plan.
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ITEM 6. SELECTED FINANCIAL DATA
We have derived the selected consolidated statements of operations and other financial data for the years ended December 31, 2020, 2019, and 2018 and the selected consolidated balance sheet data as of December 31, 2020 and 2019 from our Financial Statements. We have derived the selected consolidated statements of operations and other financial data for the years ended December 31, 2017 and 2016 and the selected consolidated balance sheet data as of December 31, 2018, 2017, and 2016 from audited consolidated financial statements not included in this Report.
You should read the following information in conjunction with our Financial Statements and Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations," included elsewhere in this Report (the "MD&A"). Our historical results are not necessarily indicative of the results to be expected in any future period.
Sensata Technologies Holding plc (Consolidated) (a)
For the year ended December 31,
(In thousands, except per share data) 2020 2019 2018 2017 2016
Statement of operations data: (b)
Net revenue $ 3,045,578 $ 3,450,631 $ 3,521,627 $ 3,306,733 $ 3,202,288
Operating costs and expenses:
Cost of revenue 2,119,044 2,267,433 2,266,863 2,138,898 2,084,159
Research and development 131,429 148,425 147,279 130,127 126,656
Selling, general and administrative 294,725 281,442 305,558 301,896 293,506
Amortization of intangible assets 129,549 142,886 139,326 161,050 201,498
Restructuring and other charges, net (c)
33,094 53,560 (47,818) 18,975 4,113
Total operating costs and expenses 2,707,841 2,893,746 2,811,208 2,750,946 2,709,932
Operating income 337,737 556,885 710,419 555,787 492,356
Interest expense, net (171,757) (158,554) (153,679) (159,761) (165,818)
Other, net (d)
(339) (7,908) (30,365) 6,415 (5,093)
Income before taxes 165,641 390,423 526,375 402,441 321,445
Provision for/(benefit from) income taxes (e)
1,355 107,709 (72,620) (5,916) 59,011
Net income $ 164,286 $ 282,714 $ 598,995 $ 408,357 $ 262,434
Basic net income per share $ 1.04 $ 1.76 $ 3.55 $ 2.39 $ 1.54
Diluted net income per share $ 1.04 $ 1.75 $ 3.53 $ 2.37 $ 1.53
Weighted-average ordinary shares outstanding—basic 157,373 160,946 168,570 171,165 170,709
Weighted-average ordinary shares outstanding—diluted 158,134 161,968 169,859 172,169 171,460
Other financial data: (b)
Net cash provided by/(used in):
Operating activities $ 559,775 $ 619,562 $ 620,563 $ 557,646 $ 521,525
Investing activities $ (182,092) $ (208,777) $ (237,606) $ (140,722) $ (174,778)
Financing activities $ 710,178 $ (366,499) $ (406,213) $ (15,263) $ (337,582)
Additions to property, plant and equipment and capitalized software $ (106,719) $ (161,259) $ (159,787) $ (144,584) $ (130,217)
As of December 31,
(In thousands) 2020 2019 2018 2017 2016
Balance sheet data: (b)
Cash and cash equivalents $ 1,861,980 $ 774,119 $ 729,833 $ 753,089 $ 351,428
Working capital (f)
$ 1,484,815 $ 1,330,906 $ 1,277,211 $ 1,218,796 $ 758,189
Total assets $ 7,844,202 $ 6,834,519 $ 6,797,687 $ 6,641,525 $ 6,240,976
Total debt, net including finance lease and other financing obligations $ 3,998,883 $ 3,255,613 $ 3,264,941 $ 3,270,269 $ 3,273,594
Total shareholders’ equity $ 2,705,486 $ 2,573,755 $ 2,608,434 $ 2,345,626 $ 1,942,007
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__________________________________________
(a) On March 28, 2018, the cross-border merger of Sensata Technologies Holding N.V. ("Sensata N.V.") and Sensata Technologies Holding plc ("Sensata plc") was completed, with Sensata plc being the surviving entity (the "Merger"). On the date of the Merger, Sensata plc became the publicly-traded parent of the subsidiary companies that were previously controlled by Sensata N.V., with no changes made to the business being conducted by Sensata N.V. prior to the Merger. Due to the various legal aspects of the Merger, Sensata plc retains the historical data of Sensata N.V., and no recasting or adjustment is required as a result of the Merger.
(b) We acquired GIGAVAC, LLC ("GIGAVAC") in fiscal year 2018. Pro forma amounts are not shown. We sold the capital stock of Schrader Bridgeport International, Inc. and August France Holding Company SAS (collectively, the "Valves Business") in fiscal year 2018. Prior year amounts have not been recast.
(c) Restructuring and other charges, net for the years ended December 31, 2020, 2019, 2018, 2017, and 2016 consisted of the following (refer also to Note 5, "Restructuring and Other Charges, Net," of our Financial Statements):
For the year ended December 31,
(In thousands) 2020 2019 2018 2017 2016
Q2 2020 Global Restructure Program (i)
$ 24,458 $ — $ — $ — $ —
Other restructuring charges
Severance costs, net (i)(ii)
3,042 29,240 7,566 11,125 813
Facility and other exit costs (iii)
1,323 808 877 7,850 3,300
Gain on sale of Valves Business (i)
— — (64,423) — —
Other (i)
4,271 23,512 8,162 — —
Restructuring and other charges, net $ 33,094 $ 53,560 $ (47,818) $ 18,975 $ 4,113
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(i) Refer to Note 5, "Restructuring and Other Charges, Net," of our Financial Statements for additional information regarding amounts recognized in each of the years ended December 31, 2020, 2019, and 2018.
(ii) For the year ended December 31, 2017, included $8.4 million of charges related to the closure of our facility in Minden, Germany, a site we obtained in connection with the acquisition of certain subsidiaries of Custom Sensors & Technologies Ltd. ("CST") in fiscal year 2015.
(iii) For the year ended December 31, 2017, these amounts included $3.2 million of costs related to the closure of our facility in Minden, Germany and $3.1 million of costs associated with the consolidation of two other manufacturing sites in Europe. For the year ended December 31, 2016 these amounts primarily related to the relocation of manufacturing lines from our facility in the Dominican Republic to a manufacturing facility in Mexico.
(d) Other, net for the years ended December 31, 2020, 2019, 2018, 2017, and 2016 consisted of the following:
For the year ended December 31,
(In thousands) 2020 2019 2018 2017 2016
Gain/(loss) related to foreign currency exchange rates (i)
$ 4,071 $ (4,577) $ (16,835) $ 2,423 $ (12,471)
Gain/(loss) on commodity forward contracts 10,027 4,888 (8,481) 9,989 7,399
Loss on debt financing — (4,364) (2,350) (2,670) —
Net periodic benefit cost, excluding service cost (9,980) (3,186) (3,585) (3,402) (192)
Other (4,457) (669) 886 75 171
Other, net $ (339) $ (7,908) $ (30,365) $ 6,415 $ (5,093)
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(i) Includes net losses and gains on foreign currency remeasurement and foreign currency forward contracts. Refer to Note 6, "Other, Net," of our Financial Statements for additional information.
(e) In the year ended December 31, 2020, we completed the transfer of intangible property which resulted in a $54.2 million deferred tax benefit. For the year ended December 31, 2018, this amount included an income tax benefit of $122.1 million related to the realization of U.S. deferred tax assets previously offset by a valuation allowance. Refer to Note 7, "Income Taxes," of our Financial Statements for additional information. For the year ended December 31, 2017, this amount included an income tax benefit of $73.7 million related to the enactment of U.S. tax legislation in the fourth quarter of 2017.
(f) We define working capital as current assets less current liabilities.
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