HARMAN Reports Third Quarter Fiscal Year 2015 Results     

• Net sales increased 4% to $1.5 billion; Up 14% excluding foreign currency translation
• Operational EPS up 9% to $1.22; Operational EBITDA up 8% to $150 million
• Secured $3.2 billion of new automotive awards; $5.7 billion of awarded business year-to-date
• Acquired Symphony Teleca and Redbend

STAMFORD, Conn.--(BUSINESS WIRE)-- Harman International Industries, Incorporated (NYSE: HAR), the premier infotainment, audio and software services company, today announced results for the third quarter ended March 31, 2015.

Net sales for the third quarter were $1.46 billion, an increase of four percent compared to the same period in the prior year or 14 percent excluding the impact of foreign currency translation (ex-FX). Infotainment net sales increased six percent, or 19 percent (ex-FX), due to platform expansions, higher take rates, and stronger automotive production. Lifestyle net sales declined six percent (up two percent ex-FX). Last year’s third quarter benefited from an unusually large order from a mobile telecommunications customer. In the third quarter, stronger car audio sales partially offset this impact. Net sales in the Professional division increased 21 percent (26 percent ex-FX) primarily driven by the acquisition of AMX which expanded the Company’s product portfolio into enterprise automation and control and video switching.

Excluding restructuring and other non-recurring items, third quarter operating income was $114 million compared to $108 million in the same period in the prior year, and earnings per diluted share were $1.22 compared to $1.12 in the same period last year. On a GAAP basis, third quarter operating income was $92 million compared to $101 million in the same period in the prior year, and earnings per diluted share were $0.99 for the quarter compared to $1.05 in the same period in the prior year. The Company recorded $23 million of restructuring and non-recurring acquisition-related costs, compared to $7 million in the prior year.

“This marks the eighth consecutive quarter of top and bottom line growth. We delivered another solid quarter of growth, particularly in our automotive businesses, despite unprecedented foreign exchange headwinds. Our professional business was hit harder due to a strong US dollar and a softening in some emerging and European markets,” commented Dinesh C. Paliwal, the Company’s Chairman, President and Chief Executive Officer. “HARMAN continues to lead the industry with best-in-class connected car solutions, as evidenced by new awards for embedded infotainment and car audio systems from global industry leaders, including BMW and Daimler. Year-to-date, we have secured $5.7 billion of new automotive awards.”

Paliwal continued, “We also recently completed the acquisitions of Symphony Teleca and Redbend, which will give us immediate scale in software services and better position HARMAN to capitalize on the rapid growth of the Internet of Things. We can now deliver more powerful solutions at the intersection of cloud, mobility, and analytics for our core markets of automotive and the enterprise and diversify to a wider range of industries such as telecommunications, media, and retail.”

FY 2015 Key Figures – Total Company		Three Months Ended March 31								Nine Months Ended March 31
						Increase (Decrease)								Increase (Decrease)
$ millions (except per share data)		3MFY15		3MFY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1		9MFY15		9MFY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1
Net sales		1,464		1,404		4%		14%		4,477		3,904		15%		20%
Gross profit		418		365		15%		23%		1,326		1,066		24%		29%
Percent of net sales		28.6%		26.0%						29.6%		27.3%
SG&A		327		263		24%		34%		970		793		22%		27%
Operating income		92		101		(10%)		(5%)		356		273		31%		36%
Percent of net sales		6.2%		7.2%						8.0%		7.0%
EBITDA		132		134		(2%)		4%		471		370		27%		32%
Percent of net sales		9.0%		9.6%						10.5%		9.5%
Net Income attributable to HARMAN International Industries, Incorporated		70		73		(4%)		(0%)		270		191		41%		47%
Diluted earnings per share		0.99		1.05		(6%)		(2%)		3.83		2.74		40%		46%
Restructuring & non-recurring costs		23		7						48		37
Non-GAAP - operational1
Gross profit		422		367		15%		23%		1,318		1,071		23%		28%
Percent of net sales		28.8%		26.1%						29.4%		27.4%
SG&A		308		259		19%		28%		914		762		20%		24%
Operating income		114		108		6%		12%		404		309		31%		36%
Percent of net sales		7.8%		7.7%						9.0%		7.9%
EBITDA		150		139		8%		15%		511		401		28%		33%
Percent of net sales		10.2%		9.9%						11.4%		10.3%
Net Income attributable to HARMAN International Industries, Incorporated		87		78		11%		17%		305		221		38%		44%
Diluted earnings per share		1.22		1.12		9%		15%		4.33		3.16		37%		43%
Shares outstanding – diluted (in millions)		71		70						70		70
1 A non-GAAP measure, see reconciliations of non-GAAP measures later in this release.

Summary of Operations – Gross Margin and SG&A

Non-GAAP gross margin for the third quarter of fiscal 2015 increased 268 basis points to 28.8 percent. The improvement was primarily due to the impact of higher sales volume utilizing a more efficient fixed production cost base and the expansion of the Company’s product portfolio into enterprise automation and control and video switching.

In the third quarter of fiscal 2015, SG&A expense as a percentage of net sales increased 258 basis points to 21.0 percent on a non-GAAP basis, primarily due to higher marketing and research and development expenses and the expansion of the Company’s product portfolio into enterprise automation and control and video switching.

2015 Guidance Update

HARMAN updated its financial outlook for fiscal 2015. The Company now forecasts fiscal 2015 revenue of $6.0 billion and operational earnings per share of $5.65. The majority of the EPS reduction is related to weakness in certain geographic markets in our Professional business, with the remainder being foreign currency translation impact on the total Company. This revised guidance includes the closing of the Symphony Teleca and Redbend acquisitions, which will contribute approximately $100 million in revenue in the fourth quarter of FY 2015 and has no impact on operational earnings per share, as the net earnings from these acquisitions will be offset by financing costs and an increase in the Company’s share count.

		August 2014		January 20151		April 20152
Revenue		~$6.0 billion		~$6.0 billion		~$6.0 billion
EBITDA3		~$685 million		~$715 million		~$695 million
EPS3		~$5.25		~$5.85		~$5.65
Interest & Misc.		~$27M		~$23M		~$17M
Tax Rate		~26%		~24%		~24%
Share Count		~71 M		~70.5 M		~71 M
EUR/USD		1.35		1.224		1.195

1. Excludes Redbend and Symphony Teleca.

2. Includes Redbend and Symphony Teleca.

3. Non-GAAP, excluding restructuring, non-recurring items, and purchase accounting expenses related to acquisitions.

4. Assumed EUR/USD of 1.15 for the second half of fiscal 2015.

5. Assumes EUR/USD of 1.08 for the fourth quarter of fiscal 2015.

Investor Call Today April 30th, 2015

At 11:00 a.m. EDT today, HARMAN’s management will host an analyst and investor conference call to discuss the third quarter results. Those who want to participate via audio in the earnings conference call should dial 1 (800) 735 5968 (U.S.) or +1 (212) 231 2902 (International) ten minutes before the call and reference HARMAN, Access Code: 21766413.

In addition, HARMAN invites you to visit the Investors section of its website at: www.harman.com where visitors can sign-up for email alerts and conveniently download copies of historical earnings releases and supporting slide presentations, among other documents. The fiscal third quarter earnings release and supporting materials were posted on the site at approximately 8:00 a.m. EDT today.

A replay of the call will also be available following its completion at approximately 1:00 p.m. EDT. The replay will be available through Friday, July 31st, 2015 at 1:00 p.m. EDT. To listen to the replay, dial 1 (800) 633 8284 (U.S.) or +1 (402) 977 9140 (International), Access Code: 21766413. If you need technical assistance, call the toll-free Global Crossing Customer Care Line at 1 (800) 473 0602 (U.S.) or +1 (303) 446 4604 (International).

General Information

HARMAN (harman.com) designs and engineers connected products and solutions for consumers, automakers, and enterprises worldwide, including audio, visual and infotainment systems; enterprise automation solutions; and software services. With leading brands including AKG®, Harman Kardon®, Infinity®, JBL®, Lexicon® , Mark Levinson ® and Revel®, HARMAN is admired by audiophiles, musicians and the entertainment venues where they perform around the world. HARMAN also is a technology and integration services leader for the Automotive, Mobile, Telecommunications and Enterprise markets. More than 25 million automobiles on the road today are equipped with HARMAN audio and infotainment systems. The Company’s software solutions power billions of mobile devices and systems that are connected, integrated, personalized, adaptive and secure across all platforms, from the work and home to car and mobile. HARMAN has a workforce of approximately 25,000 people across the Americas, Europe, and Asia and reported sales of $5.9 billion during the last 12 months ended March 31, 2015. The Company’s shares are traded on the New York Stock Exchange under the symbol NYSE:HAR.

A reconciliation of the non-GAAP measures included in this press release to the most comparable GAAP measures is provided in the tables contained at the end of this press release. HARMAN does not intend for this information to be considered in isolation or as a substitute for other measures prepared in accordance with GAAP.

Forward-Looking Information

Except for historical information contained herein, the matters discussed in this earnings release are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act, as amended. One should not place undue reliance on these statements. The Company bases these statements on particular assumptions that it has made in light of its industry experience, as well as its perception of historical trends, current market conditions, current economic data, expected future developments and other factors that the Company believes are appropriate under the circumstances. These statements involve risks, uncertainties and assumptions that could cause actual results to differ materially from those suggested in the forward-looking statements, including but not limited to: (1) the Company’s ability to maintain profitability in its infotainment division if there are delays in its product launches which may give rise to significant penalties and increased engineering expense; (2) the loss of one or more significant customers, or the loss of a significant platform with an automotive customer; (3) fluctuations in currency exchange rates, particularly with respect to the value of the U.S. Dollar and the Euro; (4) the Company’s ability to successfully implement its global footprint initiative, including achieving cost reductions and other benefits in connection with the restructuring of its manufacturing, engineering, procurement and administrative organizations; (5) fluctuations in the price and supply of raw materials including, without limitation, petroleum, copper, steel, aluminum, synthetic resins, rare metals and rare-earth minerals, or shortages of materials, parts and components; (6) the inability of the Company’s suppliers to deliver products at the scheduled rate and disruptions arising in connection therewith; (7) the Company’s ability to maintain a competitive technological advantage through innovation and leading product designs; (8) the Company’s ability to integrate successfully our recently completed and future acquisitions; (9) the Company’s failure to maintain the value of its brands and implementing a sufficient brand protection program; and (10) other risks detailed in Harman International Industries, Incorporated Annual Report on Form 10-K for the fiscal year ended June 30, 2014 and other filings made by the Company with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or revise any forward-looking statement except as required by law.

This earnings release also makes reference to the Company’s awarded business, which represents the estimated future lifetime net sales for all customers. The Company's future awarded business does not represent firm customer orders. The Company reports its awarded business primarily based on written award letters from its customers. To validate these awards, the company uses various assumptions including global vehicle production forecasts, customer take rates for the Company’s products, revisions to product life cycle estimates and the impact of annual price reductions and exchange rates, among other factors. These assumptions are updated and reported externally on an annual basis. The Company updates the estimates and awarded business quarterly by adding the value of new awards received and subtracting sales recorded during the quarter. These quarterly updates do not include any assumptions for increased take rates, revisions to product life cycle, or any other factors.

APPENDIXInfotainment Division

FY 2015 Key Figures – Infotainment		Three Months Ended March 31								Nine Months Ended March 31
						Increase(Decrease)								Increase(Decrease)
$ millions (except per share data)		3MFY15		3MFY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1		9MFY15		9MFY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1
Net sales		779		736		6%		19%		2,302		2,066		11%		18%
Gross profit		180		158		15%		25%		553		464		19%		25%
Percent of net sales		23.2%		21.4%						24.0%		22.5%
SG&A		98		97		1%		14%		303		309		(2%)		4%
Operating income		82		60		36%		42%		249		155		60%		66%
Percent of net sales		10.5%		8.2%						10.8%		7.5%
EBITDA		99		77		29%		37%		301		204		47%		53%
Percent of net sales		12.7%		10.5%						13.1%		9.9%
Restructuring & non-recurring costs		1		3						5		23
Non-GAAP - operational1
Gross profit		182		160		14%		25%		557		469		19%		25%
Percent of net sales		23.3%		21.7%						24.2%		22.7%
SG&A		99		96		3%		16%		302		290		4%		10%
Operating income		83		63		31%		37%		255		179		42%		47%
Percent of net sales		10.6%		8.6%						11.1%		8.7%
EBITDA		99		78		27%		35%		303		223		36%		41%
Percent of net sales		12.7%		10.6%						13.1%		10.8%
1 A non-GAAP measure, see reconciliations of non-GAAP measures later in this release.

Net sales in the third quarter of fiscal 2015 were $779 million, an increase of six percent compared to the same period in the prior year or 19 percent excluding the impact of foreign currency translation. The increase in net sales was due to the expansion of recently launched platforms, higher take rates, and stronger automotive production partially offset by unfavorable foreign currency translation.

On a non-GAAP basis in the third quarter of fiscal 2015, gross margin increased 159 basis points to 23.3 percent compared to the prior year primarily due to the impact of improved leverage on fixed production costs and benefits from footprint migration restructuring initiatives. SG&A spending decreased 42 basis points to 12.7 percent primarily due to improved operating leverage on higher sales.

Infotainment Division Highlights

HARMAN recently secured approximately $2.1 billion of new awards to design and build the next generation infotainment systems for BMW and Daimler. Both embedded systems will feature the most sophisticated connected car technologies, including over-the-air (OTA) updates.

HARMAN infotainment systems continued to be deployed across car lines globally. New vehicles entering the market with HARMAN designed and built infotainment systems included the new VW Touran, Skoda Superb, Seat Leon, Audi Q7 and R8, the BMW 1-series, Ssangyong Tivoli, Jaguar F-type, and Land Rover Evoque.

HARMAN also continues to demonstrate its leadership in advanced connectivity through numerous industry events and partnerships. At the Geneva International Motor Show, HARMAN displayed its vision for autonomous driving together with concept car producer Rinspeed. The electric vehicle was equipped with an intelligent HARMAN infotainment system featuring next-generation navigation, entertainment, driver assistance and service functions which continuously learn the habits and preferences of the driver and passengers to predict their actions. Using an integrated telematics communication module, the vehicle remains “future-proofed” through OTA updates and provides real-time analytics to extend system functionality. This enables high speed data streaming and vehicle-to-vehicle communication which will be fundamental to autonomous driving.

HARMAN announced it was a founding member of the University of Michigan Mobility Transformation Center Affiliates Program, a major research partnership of industry, government, and academia that is laying the foundation for a commercially viable system of connected and automated vehicles. HARMAN also announced its participation in the European FANCI (Face and Body Analysis Natural Computer Interaction) project. With funding from the European Union’s Research and Innovation program, the program will identify and integrate multi-modal human-machine technologies onto a single in-car computing platform. The project will aim to make advanced safety features such as facial recognition and body analytics an affordable and viable option for tomorrow’s advanced vehicles.

Lifestyle Division

FY 2015 Key Figures – Lifestyle		Three Months Ended March 31								Nine Months Ended March 31
						Increase(Decrease)								Increase(Decrease)
$ millions (except per share data)		3M FY15		3M FY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1		9M FY15		9M FY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1
Net sales		441		468		(6%)		2%		1,408		1,232		14%		20%
Gross profit		136		131		4%		10%		455		374		22%		26%
Percent of net sales		30.8%		27.9%						32.3%		30.4%
SG&A		91		79		15%		23%		303		230		32%		36%
Operating income		45		51		(12%)		(8%)		152		144		6%		9%
Percent of net sales		10.2%		11.0%						10.8%		11.7%
EBITDA		57		60		(5%)		(1%)		182		169		8%		12%
Percent of net sales		12.9%		12.8%						13.0%		13.7%
Restructuring & non-recurring costs		8		2						23		8
Non-GAAP - operational1
Gross profit		138		131		6%		12%		447		374		19%		23%
Percent of net sales		31.4%		27.9%						31.7%		30.4%
SG&A		86		78		11%		18%		272		223		22%		26%
Operating income		53		53		(1%)		4%		175		151		16%		20%
Percent of net sales		11.9%		11.4%						12.4%		12.3%
EBITDA		62		62		0%		6%		203		176		16%		20%
Percent of net sales		14.1%		13.2%						14.4%		14.3%
1 A non-GAAP measure, see reconciliations of non-GAAP measures later in this release.

Net sales in the third quarter of fiscal 2015 were $441 million, a decrease of six percent compared to the same period in the prior year, or an increase of two percent excluding the impact of foreign currency translation. Last year’s third quarter benefited from an unusually large order from a mobile telecommunications customer. In the third quarter, stronger car audio sales partially offset this impact.

On a non-GAAP basis in the third quarter of fiscal 2015, gross margin improved by 346 basis points to 31.4 percent compared to the prior year due to product mix. SG&A expenses as a percentage of sales increased by 290 basis points to 19.5 percent, primarily due to increased investments in marketing and research and development.

Lifestyle Division Highlights

HARMAN secured new car audio awards from BMW, Ford, Fiat Chrysler, Geely, and Hyundai. HARMAN also won awards for its HALOsonic suite of sound management products. Fiat/Chrysler group will integrate HALOsonic Engine Order Cancellation (EOC) and microphone technologies into numerous vehicles. Daimler will add Internal Electronic Sound Synthesis (iESS), which creates speed and throttle-dependent sounds to improve engine feedback. Year to date, the Company has secured $1.6 billion of new awards.

At the HARMAN flagship store in New York City, Ford’s Lincoln division unveiled the new Lincoln Continental concept vehicle, which will feature HARMAN’s Revel sound system. At the same event, Ford also previewed the 2016 Lincoln MKX, which will be the first vehicle to market featuring Revel audio. Other car launches in the quarter included the Toyota Alphard (JBL) and the Hyundai Sonata Hybrid (Infinity). On March 31, 2015, HARMAN entered into an agreement to acquire the Bang & Olufsen (B&O) car audio business. HARMAN will assume all of B&O’s existing automotive programs, which include Audi, Aston Martin, and BMW. HARMAN will also leverage the distinctive B&O and B&O PLAY brands to pursue new business with the high-end luxury and mass luxury markets, respectively. The B&O brands will complement HARMAN’s industry leading portfolio of audio brands.

HARMAN also received 13 Red Dot (International) and 15 iF (Germany) new product and innovation awards for its home and multimedia products. To supplement HARMAN’s innovation pipeline, the Company recently announced a partnership with crowd-sourcing platform Quirky to jointly develop next generation audio products.

Professional Division

FY 2015 Key Figures – Professional		Three Months Ended March 31								Nine Months Ended March 31
						Increase(Decrease)								Increase(Decrease)
$ millions (except per share data)		3MFY15		3MFY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1		9MFY15		9MFY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1
Net sales		242		200		21%		26%		764		605		26%		29%
Gross profit		101		76		32%		38%		315		227		39%		42%
Percent of net sales		41.5%		38.1%						41.3%		37.6%
SG&A		84		52		64%		72%		240		151		59%		64%
Operating income		16		25		(35%)		(33%)		75		77		(2%)		(1%)
Percent of net sales		6.6%		12.4%						9.8%		12.7%
EBITDA		24		30		(19%)		(16%)		100		92		9%		11%
Percent of net sales		10.0%		14.9%						13.1%		15.2%
Restructuring & non-recurring costs		6		1						8		3
Non-GAAP - operational1
Gross profit		101		76		32%		38%		312		228		37%		40%
Percent of net sales		41.5%		38.1%						40.8%		37.7%
SG&A		79		50		56%		65%		229		148		55%		59%
Operating income		22		26		(16%)		(14%)		83		80		4%		5%
Percent of net sales		9.0%		13.0%						10.9%		13.2%
EBITDA		30		31		(4%)		(1%)		108		95		13%		15%
Percent of net sales		12.3%		15.5%						14.1%		15.7%
1 A non-GAAP measure, see reconciliations of non-GAAP measures later in this release.

Net sales in the third quarter of fiscal 2015 were $242 million, an increase of 21 percent compared to the prior year, or 26 percent excluding foreign currency impact. The increase in net sales is due to the expansion of the Company’s product portfolio into enterprise automation and control and video switching. The strong US dollar is creating a competitive disadvantage as the majority of the business is transacted in US dollars. In addition, this business also has greater macro-economic exposure in the emerging markets where the economies have underperformed.

On a non-GAAP basis in the third quarter of fiscal 2015, gross margin increased 335 basis points to 41.5 percent, and SG&A expense as a percentage of sales increased 735 basis points to 32.5 percent compared to the prior year. It is important to note that the enterprise automation and control portfolio generates higher gross margins and has higher SG&A expenses. This business has seasonality and typically generates lower sales in the third quarter, resulting in lower leverage of its fixed cost base.

Professional Division Highlights

During the third quarter, the Company’s audio, video, lighting and enterprise automation and control system solutions were selected by leading system integrators and installers around the world. Notable projects included Auckland Airport, Hard Rock Hotel in Las Vegas, National Museum of Natural History in Paris, and the Council of European Union Headquarters in Brussels.

HARMAN’s products also powered a wide range of high-profile special events, music festivals and televised award shows including the 57th Annual GRAMMY™ Awards, the 48th Annual Super Bowl Halftime Show, and the iHeartRadio Music Festival.

The division launched 56 new products during the quarter. Several HARMAN products, including AKG's studio headphones, JBL’s loudspeakers, Soundcraft’s mixing console, and DigiTech's guitar pedal were honored with innovation awards from industry experts.

Other (Corporate)

FY 2015 Key Figures – Other		Three Months Ended March 31								Nine Months Ended March 31
						Increase (Decrease)								Increase (Decrease)
$ millions (except per share data)		3MFY15		3M FY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1		9MFY15		9MFY14		IncludingCurrencyChanges		ExcludingCurrencyChanges1
SG&A		53		35		51%		52%		123		104		19%		19%
Restructuring & non-recurring costs		9		1						11		2
Non-GAAP - operational1
SG&A		44		34		28%		29%		111		101		10%		10%
1 A non-GAAP measure, see reconciliations of non-GAAP measures later in this release.

Other (Corporate) SG&A expense includes compensation, benefit and occupancy costs for corporate employees, new technology innovation, and expenses associated with the Company’s brand identity campaign. It also includes the results and operations of Redbend Ltd., which the company acquired on February 26, 2015. Other SG&A increased $10 million to $44 million compared to the prior year period, primarily due to increased research and development investments in safety, security, and Redbend operations.

HARMAN International Industries, Incorporated
Consolidated Statements of Income
		Three Months Ended				Nine Months Ended
(In thousands, except earnings per share data; unaudited)		March 31,				March 31,
		2015		2014		2015		2014
Net sales		$1,464,193		$1,404,235		$4,476,664		$3,904,064
Cost of sales		1,046,063		1,039,462		3,150,736		2,838,192
Gross profit		418,130		364,773		1,325,928		1,065,872
Selling, general and administrative expenses		326,623		263,340		969,881		793,201
Operating income		91,507		101,433		356,047		272,671
Other expenses:
Interest expense, net		3,001		2,111		7,861		5,936
Foreign exchange (gains) losses, net		(3,406)		774		(4,366)		4,745
Miscellaneous, net		2,294		2,682		6,932		5,803
Income before income taxes		89,618		95,866		345,620		256,187
Income tax expense, net		19,346		22,369		76,250		64,515
Equity in net loss of unconsolidated subsidiaries		23		112		23		206
Net income		70,249		73,385		269,347		191,466
Net income attributable to non-controlling interest		(46)		0		(156)		0
Net income attributable to HARMAN International Industries, Incorporated		$70,295		$73,385		$269,503		$191,466
Earnings per share:
Basic		$1.00		$1.06		$3.87		$2.77
Diluted		$0.99		$1.05		$3.83		$2.74
Weighted average shares outstanding:
Basic		69,946		68,939		69,557		69,067
Diluted		70,795		69,888		70,322		69,877

HARMAN International Industries, Incorporated
Consolidated Balance Sheets
(In thousands; unaudited)		March 31,				June 30,
		2015				2014
ASSETS
Current Assets
Cash and cash equivalents		$592,359				$581,312
Receivables, net		952,672				894,579
Inventories		726,354				662,128
Other current Assets		471,227				320,852
Total current assets		2,742,612				2,458,871
Property, plant and equipment, net		462,903				509,856
Goodwill		710,599				540,952
Deferred tax assets, long-term, net		88,897				170,558
Other assets		712,854				445,353
Total assets		$4,717,865				$4,125,590
LIABILITIES AND EQUITY
Current liabilities
Current portion of long-term debt		$0				$35,625
Short-term debt		2,656				3,736
Accounts payable		809,829				697,553
Accrued liabilities		674,988				566,722
Accrued warranties		155,789				155,472
Income taxes payable		32,377				26,544
Total current liabilities		1,675,639				1,485,652
Borrowings under revolving credit facility		593,448				300,000
Long-term debt		25				219,407
Pension liability		165,341				186,352
Other non-current liabilities		118,707				141,158
Total liabilities		2,553,160				2,332,569
Total HARMAN International Industries, Incorporated shareholders' equity		2,164,418				1,792,578
Noncontrolling interest		287				443
Total equity		2,164,705				1,793,021
Total liabilities and equity		$4,717,865				$4,125,590

HARMAN International Industries, Incorporated
Consolidated Statement of Income
Reconciliation of GAAP to Non-GAAP Results
(In thousands except earnings per share data;unaudited)		Three Months EndedMarch 31, 2015
						Non-GAAP -
		GAAP		Adjustments		Operational
Net sales		$1,464,193		$0		$1,464,193
Cost of sales		1,046,063		(3,599)a		1,042,464
Gross profit		418,130		3,599		421,729
Selling, general and administrative expenses		326,623		(18,999)b		307,624
Operating income		91,507		22,598		114,105
Other expenses:
Interest expense, net		3,001		0		3,001
Foreign exchange gains, net		(3,406)		0		(3,406)
Miscellaneous, net		2,294		(0)		2,294
Income before income taxes		89,618		22,598		112,216
Income tax expense, net		19,346		6,170c		25,516
Equity in loss of unconsolidated subsidiary		23		0		23
Net income		70,249		16,428		86,677
Net income attributable to non-controlling interest		(46)		0		(46)
Net income attributable to HARMAN International Industries, Incorporated		$70,295		$16,428		$86,723
Earnings per share:
Basic		$1.00		$0.23		$1.24
Diluted		$0.99		$0.23		$1.22
Weighted average shares outstanding:
Basic		69,946				69,946
Diluted		70,795				70,795

a) Restructuring expense in Cost of Sales was $3.6 million for projects to increase manufacturing productivity.

b) Restructuring expense in SG&A was $11.2 million primarily due to projects to increase productivity in engineering, manufacturing and administrative functions; other non-recurring expense included in SG&A was $7.8 million including M&A deal related expenses.

c) The tax benefits are calculated by multiplying the actual restructuring / non-recurring charge in each individual country by the discrete tax rate within that specific country.

HARMAN has provided a reconciliation of non-GAAP measures in order to provide the users of these consolidated financial statements with a better understanding of its non-recurring charges. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. These measurements should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

HARMAN International Industries, Incorporated
Consolidated Statement of Income
Reconciliation of GAAP to Non-GAAP Results
(In thousands except earnings per share data;unaudited)		Nine Months EndedMarch 31, 2015
						Non-GAAP -
		GAAP		Adjustments		Operational
Net sales		$4,476,664		$0		$4,476,664
Cost of sales		3,150,736		8,014a		3,158,750
Gross profit		1,325,928		(8,014)		1,317,914
Selling, general and administrative expenses		969,881		(55,966)b		913,915
Operating income		356,047		47,952		403,999
Other expenses:
Interest expense, net		7,861		0		7,861
Foreign exchange gains, net		(4,366)		0		(4,366)
Miscellaneous, net		6,932		0		6,932
Income before income taxes		345,620		47,952		393,572
Income tax expense, net		76,250		12,799c		89,049
Equity in net loss of unconsolidated subsidiaries		23		0		23
Net income		269,347		35,153		304,500
Net income attributable to non-controlling interest		(156)		0		(156)
Net income attributable to HARMAN International Industries, Incorporated		$269,503		$35,153		$304,656
Earnings per share:
Basic		$3.87		$0.51		$4.38
Diluted		$3.83		$0.50		$4.33
Weighted average shares outstanding:
Basic		69,557				69,557
Diluted		70,322				70,322

a) Restructuring expense in Cost of Sales was $7.9 million for projects to increase manufacturing productivity, offset by a $15.9M accrual reversal for a US Customs / NAFTA related exposure.

b) Restructuring expense in SG&A was $38.9 million primarily due to projects to increase productivity in engineering and administrative functions. Other non-recurring expense includes in SG&A was $17.1M including acquisition-related expenses.

c) The tax benefits are calculated by multiplying the actual restructuring / non-recurring charge in each individual country by the statutory tax rate within that specific country.

HARMAN has provided a reconciliation of non-GAAP measures in order to provide the users of these consolidated financial statements with a better understanding of its non-recurring charges. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. These measurements should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

HARMAN International Industries, Incorporated
Consolidated Statement of Income
Reconciliation of GAAP to Non-GAAP Results
(In thousands except earnings per share data;unaudited)		Three Months EndedMarch 31, 2014
						Non-GAAP -
		GAAP		Adjustments		Operational
Net sales		$1,404,235		$0		$1,404,235
Cost of sales		1,039,462		(2,110)a		1,037,352
Gross profit		364,773		2,110		366,883
Selling, general and administrative expenses		263,340		(4,535)b		258,805
Operating income		101,433		6,645		108,078
Other expenses:
Interest expense, net		2,111		0		2,111
Foreign exchange losses, net		774		0		774
Miscellaneous, net		2,682		(0)		2,682
Income before income taxes		95,866		6,645		102,511
Income tax expense, net		22,369		1,987c		24,356
Equity in net loss of unconsolidated subsidiaries		112		0		112
Net income		73,385		4,658		78,043
Net income attributable to non-controlling interest		0		0		0
Net income attributable to HARMAN International Industries, Incorporated		$73,385		$4,658		$78,043
Earnings per share:
Basic		$1.06		$0.07		$1.13
Diluted		$1.05		$0.07		$1.12
Weighted average shares outstanding:
Basic		68,939				68,939
Diluted		69,888				69,888

a) Restructuring expense in Cost of sales was $2.1 million for projects to increase manufacturing productivity.

b) Restructuring expense in SG&A was $2.6 million primarily due to projects to increase productivity in engineering and administrative functions. Other non-recurring expense included in SG&A was $1.9 million.

c) The tax benefits are calculated by multiplying the actual restructuring / non-recurring charge in each individual country by the statutory tax rate within that specific country.

HARMAN has provided a reconciliation of non-GAAP measures in order to provide the users of these consolidated financial statements with a better understanding of its non-recurring charges. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. These measurements should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

HARMAN International Industries, Incorporated
Consolidated Statement of Income
Reconciliation of GAAP to Non-GAAP Results
(In thousands except earnings per share data;unaudited)		Nine Months EndedMarch 31, 2014
		GAAP		Adjustments		Non-GAAP -Operational
Net sales		$3,904,064		$0		$3,904,064
Cost of sales		2,838,192		(5,543)a		2,832,649
Gross profit		1,065,872		5,543		1,071,415
Selling, general and administrative expenses		793,201		(30,990)b		762,211
Operating income		272,671		36,533		309,204
Other expenses:
Interest expense, net		5,936		0		5,936
Foreign exchange losses, net		4,745		0		4,745
Miscellaneous, net		5,803		(0)		5,803
Income before income taxes		256,187		36,533		292,720
Income tax expense, net		64,515		7,137c		71,652
Equity in net loss of unconsolidated subsidiaries		206		0		206
Net income		191,466		29,396		220,862
Net income attributable to non-controlling interest		0		0		0
Net income attributable to HARMAN International Industries, Incorporated		$191,466		$29,396		$220,862
Earnings per share:
Basic		$2.77		$0.43		$3.20
Diluted		$2.74		$0.42		$3.16
Weighted average shares outstanding:
Basic		69,067				69,067
Diluted		69,877				69,877

a) Restructuring expense in Cost of Sales was $6.1 million due to projects to increase productivity in manufacturing; other non- recurring expense included in Cost of Sales was income of $0.6 million.

b) Restructuring expense in SG&A was $27.6 million primarily due to projects to increase productivity in engineering and administrative functions; other non-recurring expense in SG&A was 3.4 million.

c) The tax benefits are calculated by multiplying the actual restructuring / non-recurring charge in each individual country by the discrete tax rate within that specific country.

HARMAN has provided a reconciliation of non-GAAP measures in order to provide the users of these consolidated financial statements with a better understanding of its non-recurring charges. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. These measurements should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

HARMAN International Industries, Incorporated
Selected Financial Data
Reconciliation of GAAP to Non-GAAP Results
Foreign Currency Translation Impact
(In thousands; unaudited)		Three Months EndedMarch 31,				Increase /(Decrease)
		2015		2014
Net sales - nominal currency		$1,464,193		$1,404,235		4%
Effects of foreign currency translation (1)				(124,870)
Net sales - local currency		1,464,193		1,279,365		14%
Gross profit - nominal currency		418,130		364,773		15%
Effects of foreign currency translation (1)				(24,565)
Gross profit - local currency		418,130		340,208		23%
SG&A - nominal currency		326,623		263,340		24%
Effects of foreign currency translation (1)				(19,267)
SG&A - local currency		326,623		244,073		34%
Operating income - nominal currency		91,507		101,433		-10%
Effects of foreign currency translation (1)				(5,298)
Operating income - local currency		91,507		96,135		-5%
Net income attributable to HARMAN International Industries, Incorporated - nominal currency		70,295		73,385		-4%
Effects of foreign currency translation (1)				(2,876)
Net income attributable to HARMAN International Industries, Incorporated - local currency		70,295		70,509		0%
(1) Impact of restating prior year results at current year foreign exchange rates.

HARMAN has provided a reconciliation of the non-GAAP measures in the table above to provide the users of these consolidated financial statements with a better understanding of the Company’s performance. Because changes in currency exchange rates affect its reported financial results, the Company shows the rates of change both including and excluding the effect of these changes in exchange rates. The Company encourages readers of its financial statements to evaluate its financial performance excluding the impact of foreign currency translation. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. This measurement should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

HARMAN International Industries, Incorporated
Selected Financial Data
Reconciliation of Non-GAAP Results
Foreign Currency Translation Impact
EXCLUDING restructuring and non-recurring charges(In thousands; unaudited)		Three Months EndedMarch 31,				Increase /(Decrease)
		2015		2014
Net sales - nominal currency		$1,464,193		$1,404,235		4%
Effects of foreign currency translation (1)				(124,870)
Net sales - local currency		1,464,193		1,279,365		14%
Gross profit - nominal currency		421,729		366,883		15%
Effects of foreign currency translation (1)				(24,965)
Gross profit - local currency		421,729		341,918		23%
SG&A - nominal currency		307,624		258,805		19%
Effects of foreign currency translation (1)				(18,740)
SG&A - local currency		307,624		240,065		28%
Operating income - nominal currency		114,105		108,078		6%
Effects of foreign currency translation (1)				(6,224)
Operating income - local currency		114,105		101,854		12%
Net income attributable to HARMAN International Industries, Incorporated - nominal currency		86,723		78,043		11%
Effects of foreign currency translation (1)				(3,803)
Net income attributable to HARMAN International Industries, Incorporated - local currency		86,723		74,240		17%
(1) Impact of restating prior year results at current year foreign exchange rates.

HARMAN has provided a reconciliation of the non-GAAP measures in the table above to provide the users of the consolidated financial statements with a better understanding of the Company’s performance. Because changes in currency exchange rates affect its reported financial results, the Company shows the rates of change both including and excluding the effect of these changes in exchange rates. The Company encourages readers of its financial statements to evaluate its financial performance excluding the impact of foreign currency translation. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. This measurement should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

HARMAN International Industries, Incorporated
Selected Financial Data
Reconciliation of GAAP to Non-GAAP Results
Foreign Currency Translation Impact
(In thousands; unaudited)		Nine Months EndedMarch 31,				Increase /(Decrease)
		2015		2014
Net sales - nominal currency		$4,476,664		$3,904,064		15%
Effects of foreign currency translation (1)				(179,247)
Net sales - local currency		4,476,664		3,724,817		20%
Gross profit - nominal currency		1,325,928		1,065,872		24%
Effects of foreign currency translation (1)				(38,869)
Gross profit - local currency		1,325,928		1,027,003		29%
SG&A - nominal currency		969,881		793,201		22%
Effects of foreign currency translation (1)				(28,658)
SG&A - local currency		969,881		764,543		27%
Operating income - nominal currency		356,047		272,671		31%
Effects of foreign currency translation (1)				(10,211)
Operating income - local currency		356,047		262,460		36%
Net income attributable to HARMAN International Industries, Incorporated - nominal currency		269,503		191,466		41%
Effects of foreign currency translation (1)				(7,876)
Net income attributable to HARMAN International Industries, Incorporated - local currency		269,503		183,590		47%
(1) Impact of restating prior year results at current year foreign exchange rates.

HARMAN has provided a reconciliation of the non-GAAP measures in the table above to provide the users of these consolidated financial statements with a better understanding of the Company’s performance. Because changes in currency exchange rates affect its reported financial results, the Company shows the rates of change both including and excluding the effect of these changes in exchange rates. The Company encourages readers of its financial statements to evaluate its financial performance excluding the impact of foreign currency translation. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. This measurement should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

HARMAN International Industries, Incorporated
Selected Financial Data
Reconciliation of Non-GAAP Results
Foreign Currency Translation Impact
EXCLUDING restructuring and non-recurring charges(In thousands; unaudited)		Nine Months EndedMarch 31,				Increase /(Decrease)
		2015		2014
Net sales - nominal currency		$4,476,664		$3,904,064		15%
Effects of foreign currency translation (1)				(179,247)
Net sales - local currency		4,476,664		3,724,817		20%
Gross profit - nominal currency		1,317,914		1,071,415		23%
Effects of foreign currency translation (1)				(39,367)
Gross profit - local currency		1,317,914		1,032,048		28%
SG&A - nominal currency		913,915		762,211		20%
Effects of foreign currency translation (1)				(27,707)
SG&A - local currency		913,915		734,504		24%
Operating income - nominal currency		403,999		309,204		31%
Effects of foreign currency translation (1)				(11,660)
Operating income - local currency		403,999		297,544		36%
Net income attributable to HARMAN International Industries, Incorporated - nominal currency		304,656		220,862		38%
Effects of foreign currency translation (1)				(9,324)
Net income attributable to HARMAN International Industries, Incorporated - local currency		304,656		211,538		44%
(1) Impact of restating prior year results at current year foreign exchange rates.

HARMAN has provided a reconciliation of the non-GAAP measures in the table above to provide the users of the consolidated financial statements with a better understanding of the Company’s performance. Because changes in currency exchange rates affect its reported financial results, the Company shows the rates of change both including and excluding the effect of these changes in exchange rates. The Company encourages readers of its financial statements to evaluate its financial performance excluding the impact of foreign currency translation. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. This measurement should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

Harman International Industries, IncorporatedReconciliation of GAAP to Non-GAAP Results

(In thousands, except earnings per sharedata; unaudited)		Three Months EndedMarch 31, 2015						Three Months EndedMarch 31, 2014
		GAAP		Adjustments		Non-GAAP -Operational		GAAP		Adjustments		Non-GAAP -Operational
HARMAN:
Operating income		91,507		22,598		114,105		101,433		6,645		108,078
Depreciation & Amortization		40,262		(4,552)		35,710		33,063		(2,086)		30,977
EBITDA		131,769		18,046		149,815		134,496		4,559		139,055
INFOTAINMENT:
Operating income		82,136		563		82,699		60,313		2,894		63,207
Depreciation & Amortization		17,122		(1,165)		15,957		16,611		(2,087)		14,524
EBITDA		99,258		(602)		98,656		76,924		807		77,731
LIFESTYLE
Operating income		45,078		7,505		52,583		51,381		1,801		53,182
Depreciation & Amortization		11,795		(2,323)		9,472		8,635		0		8,635
EBITDA		56,873		5,182		62,055		60,016		1,801		61,817
PROFESSIONAL
Operating income		16,043		5,659		21,702		24,813		1,150		25,963
Depreciation & Amortization		8,129		(98)		8,031		5,104		1		5,105
EBITDA		24,172		5,561		29,733		29,917		1,151		31,068

HARMAN has provided a reconciliation of non-GAAP measures in order to provide the users of these consolidated financial statements with a better understanding of its non-recurring charges. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. These measurements should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

Harman International Industries, IncorporatedReconciliation of GAAP to Non-GAAP Results

(In thousands, except earnings per sharedata; unaudited)		Nine Months EndedMarch 31, 2015						Nine Months EndedMarch 31, 2014
		GAAP		Adjustments		Non-GAAP -Operational		GAAP		Adjustments		Non-GAAP -Operational
HARMAN:
Operating income		356,047		47,952		403,999		272,671		36,533		309,204
Depreciation & Amortization		114,808		(7,337)		107,471		97,302		(5,541)		91,761
EBITDA		470,855		40,615		511,470		369,973		30,992		400,965
INFOTAINMENT:
Operating income		249,362		5,248		254,610		155,431		23,479		178,910
Depreciation & Amortization		51,801		(3,828)		47,973		48,851		(4,823)		44,028
EBITDA		301,163		1,420		302,583		204,282		18,656		222,938
LIFESTYLE
Operating income		151,655		23,299		174,954		143,725		7,510		151,235
Depreciation & Amortization		30,741		(2,379)		28,362		25,091		(621)		24,470
EBITDA		182,396		20,920		203,316		168,816		6,889		175,705
PROFESSIONAL
Operating income		75,128		7,910		83,038		76,697		3,220		79,917
Depreciation & Amortization		24,650		(165)		24,485		15,020		(97)		14,923
EBITDA		99,778		7,745		107,523		91,717		3,123		94,840

HARMAN has provided a reconciliation of non-GAAP measures in order to provide the users of these consolidated financial statements with a better understanding of its non-recurring charges. These non-GAAP measures are not measurements under accounting principles generally accepted in the United States. These measurements should be considered in addition to, but not as a substitute for, the information contained in HARMAN’s consolidated financial statements prepared in accordance with US GAAP.

HARMAN International Industries, Incorporated
Total Liquidity Reconciliation
Total Company Liquidity			March 31,2015
$ millions
Cash & cash equivalents			$592
Short-term investments			0
Available credit under Revolving Credit Facility			602
Total Liquidity			$1,194

Photos/Multimedia Gallery Available: http://www.businesswire.com/multimedia/home/20150430005510/en/

Harman International Industries, Incorporated
Christopher Ferris, 203-328-3500
[email protected]
or
Darrin Shewchuk, 203-328-3500
[email protected]

Source: Harman International Industries, Incorporated

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