Adjusted earnings per share
Adjusted earnings per share is a term not recognized by U.S. GAAP. The most directly comparable U.S. GAAP financial measure is diluted earnings per share. We calculate adjusted earnings per share to exclude restructuring and restructuring-related charge.
We use the adjusted earnings per share measure to evaluate overall performance, establish plans and perform strategic analyses. We believe using adjusted earnings per share avoids distortion in the evaluation of operating results by eliminating the impact of events that are not related to operating performance. These measures are based on the exclusion of specific items, and, as such, they may not be comparable to measures used by other companies that have similar titles. Our management compensates for this limitation when performing peer company comparisons by evaluating both U.S. GAAP and non-GAAP financial measures reported by peer companies. We believe that adjusted earnings per share is useful to our management, investors and stakeholders in that it: • provides a better measure of our operating performance;
• reflects the results used by management in making decisions about the
business; and • helps to review and project our performance over time. We recommend that investors and stakeholders consider both diluted earnings per share and adjusted earnings per share in evaluating our performance with peer companies.
Liquidity and Capital Resources
Cash and cash equivalents were
$96.7 millionat September 29, 2013and $109.6 millionat December 31, 2012. Total debt on September 29, 2013was $128.6 millioncompared to $153.5 millionat December 31, 2012, as we paid down the debt from cash repatriated from a foreign operation. Total debt as a percentage of total capitalization was 32.3% at the end of the third quarter of 2013, compared with 36.4% at December 31, 2012. Total debt as a percentage of total capitalization is defined as the sum of notes payable and long-term debt as a percentage of total debt and shareholders' equity. As of September 29, 2013, the amount of cash and cash equivalents held by foreign subsidiaries was $95.5 million. If these funds are needed for our operations in the U.S., we would be required to accrue U.S. taxes to repatriate these funds. However, our intent is to permanently reinvest these funds outside the U.S. and our current plans do not require us to repatriate them to fund our U.S. operations, which have we believe have sufficient liquidity. Any repatriation may not result in significant cash income tax payments as the taxable event would likely be offset by the utilization of the then available net operating losses and tax credits. 30
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Working capital decreased by
$8.2 millionin the third quarter of 2013 versus year-end 2012, primarily due to a decrease in cash and cash equivalents of $12.8 million, an increase in accounts payable of $3.5 million, and an increase in other accrued liabilities of $3.2 million, partially offset by an increase in accounts receivable, net of $7.5 million, and an increase in inventories of $2.9 million, and an increase in other current assets of $1.0 million.