UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the Quarterly Period Ended December 31, 2008
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number 0-7491
 MOLEX INCORPORATED
  Delaware
    
    36-2369491(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 2222 Wellington Court, Lisle, Illinois 60532
 þ o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer   o
(Do not check if a smaller reporting company)
    
    Smaller reporting company o
 o þ
  Common Stock
    
    
    95,551,858Class A Common Stock
    
    
    77,584,436Class B Common Stock
    
    
    94,255




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##### 



Molex Incorporated
 INDEX
 PagePART I  FINANCIAL INFORMATIONItem 1. Financial StatementsCondensed Consolidated Balance Sheets as of
December 31, 2008 and June 30, 2008
    
    
    3Condensed Consolidated Statements of Income for the
three and six months ended December 31, 2008 and 2007
    
    
    4Condensed Consolidated Statements of Cash Flows for the
six months ended December 31, 2008 and 2007
    
    
    5Notes to Condensed Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results
of Operations
    
    
    13Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    24Item 4. Controls and Procedures
    
    
    25PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    25Item 1A. Risk Factors
    
    
    25Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    26Item 4. Submission of Matters to a Vote of Security Holders
    
    
    26Item 6. Exhibits
    
    
    27SIGNATURES
    
    
    28Section 302 Certification of Chief Executive OfficerSection 302 Certification of Chief Financial OfficerSection 906 Certification of Chief Executive OfficerSection 906 Certification of Chief Financial Officer
 2




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##### 



PART I
 
 Item 1. Financial Statements
 Molex Incorporated
 
 Condensed Consolidated Balance Sheets
  Dec. 31,
    
    
    June 30,2008
    
    
    2008(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    418,573
    
    
    $
    475,507Marketable securities
    
    
    39,160
    
    
    
    34,298Accounts receivable, less allowances of $34,611 and $40,243, respectively
    
    
    600,930
    
    
    
    740,827Inventories
    
    
    448,147
    
    
    
    458,295Other current assets
    
    
    84,310
    
    
    
    74,033Total current assets
    
    
    1,591,120
    
    
    
    1,782,960Property, plant and equipment, net
    
    
    1,161,186
    
    
    
    1,172,395Goodwill
    
    
    295,321
    
    
    
    373,623Other assets
    
    
    278,257
    
    
    
    270,559Total assets
    
    $
    3,325,884
    
    
    $
    3,599,537LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    253,875
    
    
    $
    350,413Accrued expenses
    
    
    203,998
    
    
    
    154,015Current portion of long-term debt and short-term borrowings
    
    
    297,091
    
    
    
    66,687Other current liabilities
    
    
    35,058
    
    
    
    78,323Total current liabilities
    
    
    790,022
    
    
    
    649,438Other non-current liabilities
    
    
    16,947
    
    
    
    21,346Accrued pension and postretirement benefits
    
    
    100,915
    
    
    
    105,574Long-term debt
    
    
    4,829
    
    
    
    146,333Total liabilities
    
    
    912,713
    
    
    
    922,691Commitments and contingenciesStockholders equity:Common stock
    
    
    11,126
    
    
    
    11,107Paid-in capital
    
    
    585,233
    
    
    
    569,046Retained earnings
    
    
    2,687,490
    
    
    
    2,785,099Treasury stock
    
    
    (1,087,488
    )
    
    
    (1,009,021
    )Accumulated other comprehensive income
    
    
    216,810
    
    
    
    320,615Total stockholders equity
    
    
    2,413,171
    
    
    
    2,676,846Total liabilities and stockholders equity
    
    $
    3,325,884
    
    
    $
    3,599,537
  3




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##### 



Molex Incorporated
 
 Condensed Consolidated Statements of Income
   Three Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    December 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Net revenue
    
    $
    666,728
    
    
    $
    841,560
    
    
    $
    1,505,713
    
    
    $
    1,634,170Cost of sales
    
    
    490,656
    
    
    
    588,445
    
    
    
    1,080,169
    
    
    
    1,144,905Gross profit
    
    
    176,072
    
    
    
    253,115
    
    
    
    425,544
    
    
    
    489,265Selling, general and administrative
    
    
    144,612
    
    
    
    165,699
    
    
    
    310,963
    
    
    
    326,334Restructuring costs and asset impairments
    
    
    39,782
    
    
    
    7,258
    
    
    
    61,560
    
    
    
    9,887Goodwill impairment
    
    
    93,140
    
    
    
    
    
    
    
    93,140
    
    
    
    Total operating expenses
    
    
    277,534
    
    
    
    172,957
    
    
    
    465,663
    
    
    
    336,221Income (loss) from operations
    
    
    (101,462
    )
    
    
    80,158
    
    
    
    (40,119
    )
    
    
    153,044Interest income, net
    
    
    843
    
    
    
    2,356
    
    
    
    2,036
    
    
    
    4,920Other income
    
    
    18,386
    
    
    
    2,081
    
    
    
    20,993
    
    
    
    2,779Total other income
    
    
    19,229
    
    
    
    4,437
    
    
    
    23,029
    
    
    
    7,699Income (loss) before income taxes
    
    
    (82,233
    )
    
    
    84,595
    
    
    
    (17,090
    )
    
    
    160,743Income taxes
    
    
    5,011
    
    
    
    25,379
    
    
    
    25,857
    
    
    
    48,223Net (loss) income
    
    $
    (87,244
    )
    
    $
    59,216
    
    
    $
    (42,947
    )
    
    $
    112,520Earnings (loss) per share:Basic
    
    $
    (0.50
    )
    
    $
    0.33
    
    
    $
    (0.24
    )
    
    $
    0.62Diluted
    
    $
    (0.50
    )
    
    $
    0.33
    
    
    $
    (0.24
    )
    
    $
    0.61Dividends declared per share
    
    $
    0.1525
    
    
    $
    0.1125
    
    
    $
    0.3050
    
    
    $
    0.2250Average common shares outstanding:Basic
    
    
    174,636
    
    
    
    181,034
    
    
    
    175,736
    
    
    
    182,211Diluted
    
    
    174,636
    
    
    
    182,174
    
    
    
    175,736
    
    
    
    183,273
  4




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##### 



Molex Incorporated
 
 Condensed Consolidated Statements of Cash Flows
   Six Months EndedDecember 31,2008
    
    
    2007Operating activities:Net (loss) income
    
    $
    (42,947
    )
    
    $
    112,520Add non-cash items included in net (loss) income:Depreciation and amortization
    
    
    126,349
    
    
    
    121,357Share-based compensation
    
    
    13,075
    
    
    
    12,427Goodwill impairment
    
    
    93,140
    
    
    
    Other non-cash items
    
    
    (234
    )
    
    
    1,654Changes in assets and liabilities:Accounts receivable
    
    
    141,592
    
    
    
    (6,155
    )Inventories
    
    
    2,637
    
    
    
    437Accounts payable
    
    
    (110,047
    )
    
    
    (5,548
    )Other current assets and liabilities
    
    
    10,822
    
    
    
    7,403Other assets and liabilities
    
    
    (44,144
    )
    
    
    6,191Cash provided from operating activities
    
    
    190,243
    
    
    
    250,286Investing activities:Capital expenditures
    
    
    (96,637
    )
    
    
    (102,417
    )Proceeds from sales of property, plant and equipment
    
    
    2,324
    
    
    
    6,787Proceeds from sales or maturities of marketable securities
    
    
    7,230
    
    
    
    253,694Purchases of marketable securities
    
    
    (15,111
    )
    
    
    (213,023
    )Acquisitions
    
    
    (73,447
    )
    
    
    (42,470
    )Other investing activities
    
    
    (188
    )
    
    
    (6,433
    )Cash used for investing activities
    
    
    (175,829
    )
    
    
    (103,862
    )Financing activities:Proceeds from revolving credit facility
    
    
    115,000
    
    
    
    Payments on revolving credit facility
    
    
    (50,000
    )
    
    
    Net change in long-term debt
    
    
    (197
    )
    
    
    (1,467
    )Cash dividends paid
    
    
    (46,807
    )
    
    
    (34,259
    )Exercise of stock options
    
    
    1,187
    
    
    
    7,513Purchase of treasury stock
    
    
    (76,342
    )
    
    
    (111,779
    )Other financing activities
    
    
    (960
    )
    
    
    (497
    )Cash used for financing activities
    
    
    (58,119
    )
    
    
    (140,489
    )Effect of exchange rate changes on cash
    
    
    (13,229
    )
    
    
    14,742Net increase (decrease) in cash and cash equivalents
    
    
    (56,934
    )
    
    
    20,677Cash and cash equivalents, beginning of period
    
    
    475,507
    
    
    
    378,361Cash and cash equivalents, end of period
    
    $
    418,573
    
    
    $
    399,038
  5




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##### 



Molex Incorporated
 
 Notes to Condensed Consolidated Financial Statements
  1. Basis of Presentation
    2. Restructuring Costs and Asset Impairments
   6




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##### 



Trans-
    
    
    Custom &
    
    
    CorporateConnector
    
    
    portation
    
    
    Electrical
    
    
    and Other
    
    
    TotalCumulative costs at June 30, 2008
    
    $
    15,466
    
    
    $
    8,474
    
    
    $
    15,543
    
    
    $
    28,633
    
    
    $
    68,116Net restructuring costs during
the first quarter
    
    
    280
    
    
    
    14,991
    
    
    
    3,779
    
    
    
    2,728
    
    
    
    21,778Cumulative costs at Sept. 30, 2008
    
    $
    15,746
    
    
    $
    23,465
    
    
    $
    19,322
    
    
    $
    31,361
    
    
    $
    89,894Net restructuring costs during
the current quarter
    
    
    12,075
    
    
    
    14,766
    
    
    
    6,324
    
    
    
    6,617
    
    
    
    39,782Cumulative costs at Dec. 31, 2008
    
    $
    27,821
    
    
    $
    38,231
    
    
    $
    25,646
    
    
    $
    37,978
    
    
    $
    129,676
  Balance at June 30, 2008
    
    $
    19,842Cash payments
    
    
    (5,321
    )Charges to expense
    
    
    19,106Non-cash related costs
    
    
    (2,978
    )Balance at September 30, 2008
    
    $
    30,649Cash payments
    
    
    (6,713
    )Charges to expense
    
    
    35,362Non-cash related costs
    
    
    327Balance at December 31, 2008
    
    $
    59,625
  3. Goodwill Impairment
    4. Acquisitions
  7




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##### 



5. Earnings (Loss) Per Share
  Three Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    December 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Basic average common shares outstanding
    
    
    174,636
    
    
    
    181,034
    
    
    
    175,736
    
    
    
    182,211Effect of dilutive stock options
    
    
    
    
    
    
    1,140
    
    
    
    
    
    
    
    1,062Diluted average common shares outstanding
    
    
    174,636
    
    
    
    182,174
    
    
    
    175,736
    
    
    
    183,273
  6. Comprehensive Income (Loss)
  Three Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    December 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Net (loss) income
    
    $
    (87,244
    )
    
    $
    59,216
    
    
    $
    (42,947
    )
    
    $
    112,520Translation adjustments
    
    
    (19,176
    )
    
    
    42,306
    
    
    
    (92,289
    )
    
    
    83,801Unrealized investment gain (loss)
    
    
    (5,985
    )
    
    
    3,989
    
    
    
    (11,516
    )
    
    
    6,485Total comprehensive (loss) income
    
    $
    (112,405
    )
    
    $
    105,511
    
    
    $
    (146,752
    )
    
    $
    202,806
 7. Inventories
  Dec. 31,
    
    
    June 30,2008
    
    
    2008Raw materials
    
    $
    69,417
    
    
    $
    81,407Work in process
    
    
    138,691
    
    
    
    144,683Finished goods
    
    
    240,039
    
    
    
    232,205Total inventories
    
    $
    448,147
    
    
    $
    458,295
 8. Investments
  9. Pensions and Other Postretirement Benefits
  8




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##### 



Three Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    December 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Service cost
    
    $
    2,066
    
    
    $
    2,445
    
    
    $
    4,132
    
    
    $
    4,691Interest cost
    
    
    2,064
    
    
    
    2,367
    
    
    
    4,128
    
    
    
    4,295Expected return on plan assets
    
    
    (2,180
    )
    
    
    (2,893
    )
    
    
    (4,360
    )
    
    
    (5,065
    )Amortization of prior service cost
    
    
    11
    
    
    
    53
    
    
    
    22
    
    
    
    106Recognized actuarial losses
    
    
    62
    
    
    
    85
    
    
    
    124
    
    
    
    170Amortization of transition obligation
    
    
    106
    
    
    
    11
    
    
    
    212
    
    
    
    21Curtailment adjustment
    
    
    
    
    
    
    (5,444
    )
    
    
    
    
    
    
    (5,444
    )Benefit cost (credit)
    
    $
    2,129
    
    
    $
    (3,376
    )
    
    $
    4,258
    
    
    $
    (1,226
    )
  Three Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    December 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Service cost
    
    $
    611
    
    
    $
    765
    
    
    $
    1,222
    
    
    $
    1,524Interest cost
    
    
    796
    
    
    
    812
    
    
    
    1,592
    
    
    
    1,619Amortization of prior service cost
    
    
    (160
    )
    
    
    (175
    )
    
    
    (320
    )
    
    
    (348
    )Recognized actuarial losses
    
    
    157
    
    
    
    329
    
    
    
    314
    
    
    
    656Curtailment adjustment
    
    
    (4,000
    )
    
    
    
    
    
    
    (4,000
    )
    
    
    Benefit (credit) cost
    
    $
    (2,596
    )
    
    $
    1,731
    
    
    $
    (1,192
    )
    
    $
    3,451
 10. Debt
  11. Income Taxes
  9




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##### 



12. Fair Value Measurements
   
    
    Level 1: Observable inputs such as quoted prices for identical assets or
liabilities in active markets.
    
    Level 2: Observable inputs other than quoted prices substantiated by market data
and observable, either directly or indirectly for the asset or liability. This
includes quoted prices for similar assets or liabilities in active markets.
    
    Level 3: Unobservable inputs that are supported by little or no market activity
and that are significant to the fair value of the assets and liabilities.
  Quoted Pricesin Active
    
    
    SignificantTotal
    
    
    Markets for
    
    
    Other
    
    
    SignificantMeasured
    
    
    Identical
    
    
    Observable
    
    
    Unobservableat Fair
    
    
    Assets
    
    
    Inputs
    
    
    InputsValue
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Investments
    
    $
    5,336
    
    
    $
    5,336
    
    
    $
    
    
    
    $
    Derivative financial instruments, net
    
    
    2,403
    
    
    
    
    
    
    
    2,403
    
    
    
    Total
    
    $
    7,739
    
    
    $
    5,336
    
    
    $
    2,403
    
    
    $
    
  13. New Accounting Pronouncements
   10




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##### 



14. Segments and Related Information
  
    
    The Connector segment designs and manufactures products for high-speed,
high-density, high signal-integrity applications as well as fine-pitch, low-profile
connectors for the consumer and commercial markets.
    
    The Transportation segment designs and manufactures products that withstand
environments such as heat, cold, dust, dirt, liquid and vibration for automotive
and other transportation applications.
    
    The Custom & Electrical segment designs and manufactures integrated and
customizable electronic components across all industries that provide original,
differentiated solutions to customer requirements. It also leverages expertise in
the use of signal, power and interface technology in industrial automation and
other harsh environment applications.
 11




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##### 



Trans-
    
    Custom &
    
    CorporateConnector
    
    portation
    
    Electrical
    
    & Other
    
    TotalFor the three months ended:December 31, 2008:Revenues from external customers
    
    $
    377,610
    
    
    $
    73,996
    
    
    $
    214,194
    
    
    $
    928
    
    
    $
    666,728Income (loss) from operations
    
    
    12,588
    
    
    
    (131,977
    )
    
    
    13,633
    
    
    
    4,294
    
    
    
    (101,462
    )Depreciation & amortization
    
    
    41,246
    
    
    
    8,864
    
    
    
    8,535
    
    
    
    4,191
    
    
    
    62,836Capital expenditures
    
    
    28,074
    
    
    
    9,283
    
    
    
    6,487
    
    
    
    7,501
    
    
    
    51,345December 31, 2007:Revenues from external customers
    
    $
    490,289
    
    
    $
    122,926
    
    
    $
    225,962
    
    
    $
    2,383
    
    
    $
    841,560Income (loss) from operations
    
    
    82,248
    
    
    
    124
    
    
    
    17,076
    
    
    
    (19,290
    )
    
    
    80,158Depreciation & amortization
    
    
    38,916
    
    
    
    9,450
    
    
    
    8,722
    
    
    
    3,296
    
    
    
    60,384Capital expenditures
    
    
    30,047
    
    
    
    7,097
    
    
    
    5,776
    
    
    
    10,353
    
    
    
    53,273For the six months ended:December 31, 2008:Revenues from external customers
    
    $
    852,478
    
    
    $
    180,238
    
    
    $
    471,528
    
    
    $
    1,469
    
    
    $
    1,505,713Income (loss) from operations
    
    
    88,608
    
    
    
    (149,493
    )
    
    
    36,163
    
    
    
    (15,397
    )
    
    
    (40,119
    )Depreciation & amortization
    
    
    82,028
    
    
    
    18,419
    
    
    
    17,149
    
    
    
    8,753
    
    
    
    126,349Capital expenditures
    
    
    54,724
    
    
    
    19,954
    
    
    
    12,628
    
    
    
    9,331
    
    
    
    96,637December 31, 2007:Revenues from external customers
    
    $
    942,543
    
    
    $
    242,979
    
    
    $
    444,165
    
    
    $
    4,483
    
    
    $
    1,634,170Income (loss) from operations
    
    
    157,592
    
    
    
    4,527
    
    
    
    34,134
    
    
    
    (43,209
    )
    
    
    153,044Depreciation & amortization
    
    
    77,108
    
    
    
    19,391
    
    
    
    17,665
    
    
    
    7,193
    
    
    
    121,357Capital expenditures
    
    
    59,124
    
    
    
    16,614
    
    
    
    8,963
    
    
    
    17,716
    
    
    
    102,417Corporate & other includes expenses primarily related to corporate operations that are not
allocated to segments such as executive management, human resources, legal, finance and information
technology. The loss from operations for the Transportation segment includes a $93.1 million
goodwill impairment charge during the second quarter.Segment assets, which are comprised of accounts receivable, inventory and fixed assets, are
summarized as follows (in thousands):Trans-
    
    Custom &
    
    CorporateConnector
    
    portation
    
    Electrical
    
    & Other
    
    TotalDecember 31, 2008
    
    $
    1,243,830
    
    
    $
    346,598
    
    
    $
    456,324
    
    
    $
    163,511
    
    
    $
    2,210,263June 30, 2008
    
    
    1,293,342
    
    
    
    413,233
    
    
    
    500,197
    
    
    
    164,745
    
    
    
    2,371,517
  Dec. 31,
    
    
    June 30,2008
    
    
    2008Segment net assets
    
    $
    2,210,263
    
    
    $
    2,371,517Other current assets
    
    
    542,043
    
    
    
    583,838Non current assets
    
    
    573,578
    
    
    
    644,182Consolidated total assets
    
    $
    3,325,884
    
    
    $
    3,599,537
 12




---



##### 



Molex Incorporated
 
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
   Overview
   
    
    The Connector segment manufactures and sells products for high-speed,
high-density, high signal-integrity applications as well as fine-pitch, low-profile
connectors for the consumer and commercial markets.
    
    The Transportation segment designs and manufactures products that withstand
environments such as heat, cold, dust, dirt, liquid and vibration for automotive
and other transportation applications.
    
    The Custom & Electrical segment manufactures and sells integrated and
customizable electronic components across all industries that provide original,
differentiated solutions to customer requirements. It also leverages expertise in
the use of signal, power and interface technology in industrial automation and
other harsh environment applications.
   13




---



##### 



Critical Accounting Policies and Estimates
   14




---



##### 



Results of Operations
  Percentage
    
    
    
    
    
    
    Percentage2008
    
    
    of Revenue
    
    
    2007
    
    
    of RevenueNet revenue
    
    $
    666,728
    
    
    
    100.0
    %
    
    $
    841,560
    
    
    
    100.0
    %Cost of sales
    
    
    490,656
    
    
    
    73.6
    %
    
    
    588,445
    
    
    
    69.9
    %Gross profit
    
    
    176,072
    
    
    
    26.4
    %
    
    
    253,115
    
    
    
    30.1
    %Selling, general & administrative
    
    
    144,612
    
    
    
    21.7
    %
    
    
    165,699
    
    
    
    19.7
    %Restructuring costs and asset impairments
    
    
    132,922
    
    
    
    19.9
    %
    
    
    7,258
    
    
    
    0.9
    %Income (loss) from operations
    
    
    (101,462
    )
    
    
    (15.2
    )%
    
    
    80,158
    
    
    
    9.5
    %Other income, net
    
    
    19,229
    
    
    
    2.9
    %
    
    
    4,437
    
    
    
    0.5
    %Income (loss) before income taxes
    
    
    (82,233
    )
    
    
    (12.3
    )%
    
    
    84,595
    
    
    
    10.0
    %Income taxes
    
    
    5,011
    
    
    
    0.8
    %
    
    
    25,379
    
    
    
    3.0
    %Net (loss) income
    
    $
    (87,244
    )
    
    
    (13.1
    )%
    
    $
    59,216
    
    
    
    7.0
    %
  Percentage
    
    
    
    
    
    
    Percentage2008
    
    
    of Revenue
    
    
    2007
    
    
    of RevenueNet revenue
    
    $
    1,505,713
    
    
    
    100.0
    %
    
    $
    1,634,170
    
    
    
    100.0
    %Cost of sales
    
    
    1,080,169
    
    
    
    71.7
    %
    
    
    1,144,905
    
    
    
    70.1
    %Gross profit
    
    
    425,544
    
    
    
    28.3
    %
    
    
    489,265
    
    
    
    29.9
    %Selling, general & administrative
    
    
    310,963
    
    
    
    20.7
    %
    
    
    326,334
    
    
    
    20.0
    %Restructuring costs and asset impairments
    
    
    154,700
    
    
    
    10.3
    %
    
    
    9,887
    
    
    
    0.6
    %Income (loss) from operations
    
    
    (40,119
    )
    
    
    (2.7
    )%
    
    
    153,044
    
    
    
    9.3
    %Other income, net
    
    
    23,029
    
    
    
    1.6
    %
    
    
    7,699
    
    
    
    0.5
    %Income (loss) before income taxes
    
    
    (17,090
    )
    
    
    (1.1
    )%
    
    
    160,743
    
    
    
    9.8
    %Income taxes
    
    
    25,857
    
    
    
    1.7
    %
    
    
    48,223
    
    
    
    2.9
    %Net (loss) income
    
    $
    (42,947
    )
    
    
    (2.8
    )%
    
    $
    112,520
    
    
    
    6.9
    %
 Net Revenue
  Comparable
    
    SequentialQuarter
    
    QuarterConsumer
    
    
    (11.3
    )%
    
    
    (10.9
    )%Telecommunications
    
    
    (15.8
    )
    
    
    (25.7
    )Automotive
    
    
    (37.8
    )
    
    
    (27.4
    )Data
    
    
    (19.2
    )
    
    
    (17.9
    )Industrial
    
    
    (25.5
    )
    
    
    (19.8
    )
 15




---



##### 




    
    Consumer market revenue decreased against both the comparable quarter and the
sequential quarter due to our customers concerns regarding global economies and lower
than expected pre-holiday production volumes, particularly in home entertainment and
home appliance products. The decline was partially offset by increased revenue for
gaming devices.
    
    Telecommunications market revenue decreased against both the comparable quarter and
the sequential quarter due to lower demand for mobile products in the first half of
fiscal 2009. We had strong revenue growth during the first quarter of fiscal 2009 and
the second half of fiscal 2008 in our antenna products for mobile devices, but demand
decreased significantly in November and December of fiscal 2009.
    
    Automotive market revenue declined against both the comparable quarter and the
sequential quarter due to a sharp decrease in demand related to concerns over the
current economic conditions. During fiscal 2008, the automotive market benefited from
new products reflecting higher electronic content in automobiles. We believe the number
of automobiles manufactured by our customers continues to decrease and automotive
manufacturing companies inventories are at elevated levels.
    
    Data market revenue for the second quarter of fiscal 2009 decreased over the
comparable and sequential quarters due to a decrease in demand for computers and
peripherals.
    
    Industrial market revenue for fiscal 2009 decreased compared with fiscal 2008 due to
declines in residential and commercial construction, lower demand in the industrial
communications business worldwide, particularly in North America and Europe, and lower
demand for factory automation as the manufacturing sector slows. The decreased revenue
compared to the sequential quarter was partially offset by increased demand for
industrial instruments.
  Three Months Ended
    
    Six Months EndedDecember 31,
    
    December 31,2008
    
    2007
    
    2008
    
    2007Americas
    
    
    29
    %
    
    
    26
    %
    
    
    28
    %
    
    
    27
    %Asia Pacific
    
    
    54
    
    
    
    54
    
    
    
    54
    
    
    
    53Europe
    
    
    17
    
    
    
    20
    
    
    
    18
    
    
    
    20Total
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
  Three Months
    
    
    Six MonthsEnded
    
    
    EndedDec. 31, 2008
    
    
    Dec. 31, 2008Net revenue for prior year period
    
    $
    841,560
    
    
    $
    1,634,170Components of net revenue change:Organic net revenue decline
    
    
    (178,234
    )
    
    
    (181,277
    )Currency translation
    
    
    1,148
    
    
    
    45,125Acquisitions
    
    
    2,254
    
    
    
    7,695Total change in net revenue from prior year period
    
    
    (174,832
    )
    
    
    (128,457
    )Net revenue for current year period
    
    $
    666,728
    
    
    $
    1,505,713Organic net revenue decline as a percentage of net revenue from prior year period
    
    
    (21.2
    )%
    
    
    (11.1
    )%
  16




---



##### 



Three Months Ended December 31, 2008
    
    
    Six Months Ended December 31, 2008Local
    
    
    Currency
    
    
    Net
    
    
    Local
    
    
    Currency
    
    
    NetCurrency
    
    
    Translation
    
    
    Change
    
    
    Currency
    
    
    Translation
    
    
    ChangeAmericas
    
    $
    (24,902
    )
    
    $
    (892
    )
    
    $
    (25,794
    )
    
    $
    (34,067
    )
    
    $
    (678
    )
    
    $
    (34,745
    )Asia Pacific
    
    
    (103,991
    )
    
    
    8,037
    
    
    
    (95,954
    )
    
    
    (86,466
    )
    
    
    32,798
    
    
    
    (53,668
    )Europe
    
    
    (43,976
    )
    
    
    (5,997
    )
    
    
    (49,973
    )
    
    
    (59,460
    )
    
    
    13,005
    
    
    
    (46,455
    )Corporate & other
    
    
    (3,111
    )
    
    
    
    
    
    
    (3,111
    )
    
    
    6,411
    
    
    
    
    
    
    
    6,411Net change
    
    $
    (175,980
    )
    
    $
    1,148
    
    
    $
    (174,832
    )
    
    $
    (173,582
    )
    
    $
    45,125
    
    
    $
    (128,457
    )
  Three Months
    
    Six MonthsEnded
    
    EndedDec. 31, 2008
    
    Dec. 31, 2008Americas
    
    
    (11.5
    )%
    
    
    (7.6
    )%Asia Pacific
    
    
    (23.0
    )
    
    
    (10.0
    )Europe
    
    
    (26.7
    )
    
    
    (18.6
    )Total
    
    
    (20.9
    )%
    
    
    (10.6
    )%
  Percentage
    
    
    
    
    
    
    Percentage2008
    
    
    of Revenue
    
    
    2007
    
    
    of RevenueConnector
    
    $
    377,610
    
    
    
    56.6
    %
    
    $
    490,289
    
    
    
    58.3
    %Transportation
    
    
    73,996
    
    
    
    11.1
    
    
    
    122,926
    
    
    
    14.6Custom & Electrical
    
    
    214,194
    
    
    
    32.1
    
    
    
    225,962
    
    
    
    26.9Corporate & Other
    
    
    928
    
    
    
    0.2
    
    
    
    2,383
    
    
    
    0.2Total
    
    $
    666,728
    
    
    
    100.0
    %
    
    $
    841,560
    
    
    
    100.0
    %
  Percentage
    
    
    
    
    
    
    Percentage2008
    
    
    of Revenue
    
    
    2007
    
    
    of RevenueConnector
    
    $
    852,478
    
    
    
    56.6
    %
    
    $
    942,543
    
    
    
    57.7
    %Transportation
    
    
    180,238
    
    
    
    12.0
    
    
    
    242,979
    
    
    
    14.9Custom & Electrical
    
    
    471,528
    
    
    
    31.3
    
    
    
    444,165
    
    
    
    27.2Corporate & Other
    
    
    1,469
    
    
    
    0.1
    
    
    
    4,483
    
    
    
    0.2Total
    
    $
    1,505,713
    
    
    
    100.0
    %
    
    $
    1,634,170
    
    
    
    100.0
    %
 17




---



##### 



Gross Profit
  Three Months Ended
    
    Six Months EndedDecember 31,
    
    December 31,2008
    
    2007
    
    2008
    
    2007Gross profit
    
    $
    176,072
    
    
    $
    253,115
    
    
    $
    425,544
    
    
    $
    489,265Gross margin
    
    
    26.4
    %
    
    
    30.1
    %
    
    
    28.3
    %
    
    
    29.9
    %
   Three Months Ended
    
    Six Months EndedDecember 31,
    
    December 31,2008
    
    2007
    
    2008
    
    2007Copper (price per pound)
    
    $
    2.66
    
    
    $
    3.46
    
    
    $
    3.20
    
    
    $
    3.48Gold (price per troy ounce)
    
    
    795.00
    
    
    
    786.00
    
    
    
    834.00
    
    
    
    733.00
   Three Months
    
    Six MonthsEnded
    
    EndedDec. 31, 2008
    
    Dec. 31, 2008Price erosion
    
    $
    (22,342
    )
    
    $
    (54,599
    )Currency translation
    
    
    1,380
    
    
    
    15,083Currency transaction
    
    
    (3,084
    )
    
    
    (12,294
    )
  18




---



##### 



Operating Expenses
  Three Months Ended
    
    Six Months EndedDecember 31,
    
    December 31,2008
    
    2007
    
    2008
    
    2007Selling, general and administrative
    
    $
    144,612
    
    
    $
    165,699
    
    
    $
    310,963
    
    
    $
    326,334Selling, general and administrative
as a percentage of revenue
    
    
    21.7
    %
    
    
    19.7
    %
    
    
    20.7
    %
    
    
    20.0
    %Restructuring costs and asset impairments
    
    $
    39,782
    
    
    $
    7,258
    
    
    $
    61,560
    
    
    $
    9,887Goodwill impairment
    
    
    93,140
    
    
    
    
    
    
    
    93,140
    
    
    
    
     Other Income
  19




---



##### 



Effective Tax Rate
  Backlog
  Segments
 Connector
  Three Months
    
    
    Six MonthsEnded
    
    
    EndedDec. 31, 2008
    
    
    Dec. 31, 2008Net revenue for prior year period
    
    $
    490,289
    
    
    $
    942,543Components of net revenue change:Organic net revenue decline
    
    
    (119,336
    )
    
    
    (122,943
    )Currency translation
    
    
    6,657
    
    
    
    32,878Total change in net revenue from prior year period
    
    
    (112,679
    )
    
    
    (90,065
    )Net revenue for current year period
    
    $
    377,610
    
    
    $
    852,478Organic net revenue decline as a percentage of
net revenue for prior year period
    
    
    (24.3
    )%
    
    
    (13.0
    )%
   Three Months Ended
    
    Six Months EndedDecember 31,
    
    December 31,2008
    
    2007
    
    2008
    
    2007Income from operations
    
    $
    12,588
    
    
    $
    82,248
    
    
    $
    88,608
    
    
    $
    157,592Operating margin
    
    
    3.3
    %
    
    
    16.8
    %
    
    
    10.4
    %
    
    
    16.7
    %
  20




---



##### 



Transportation
  Three Months
    
    
    Six MonthsEnded
    
    
    EndedDec. 31, 2008
    
    
    Dec. 31, 2008Net revenue for prior year period
    
    $
    122,926
    
    
    $
    242,979Components of net revenue change:Organic net revenue decline
    
    
    (47,490
    )
    
    
    (67,942
    )Currency translation
    
    
    (1,440
    )
    
    
    5,201Total change in net revenue from prior year period
    
    
    (48,930
    )
    
    
    (62,741
    )Net revenue for current year period
    
    $
    73,996
    
    
    $
    180,238Organic net revenue decline as a percentage of
net revenue for prior year period
    
    
    (38.6
    )%
    
    
    (28.0
    )%
   Three Months Ended
    
    Six Months EndedDecember 31,
    
    December 31,2008
    
    2007
    
    2008
    
    2007Income from operations
    
    $
    (131,977
    )
    
    $
    124
    
    
    $
    (149,493
    )
    
    $
    4,527Operating margin
    
    
    (178.4
    )%
    
    
    0.1
    %
    
    
    (82.9
    )%
    
    
    1.9
    %
  Custom & Electrical
  Three Months
    
    
    Six MonthsEnded
    
    
    EndedDec. 31, 2008
    
    
    Dec. 31, 2008Net revenue for prior year period
    
    $
    225,962
    
    
    $
    444,165Components of net revenue change:Organic net revenue decline
    
    
    (9,949
    )
    
    
    12,696Currency translation
    
    
    (4,073
    )
    
    
    6,972Acquisitions
    
    
    2,254
    
    
    
    7,695Total change in net revenue from prior year period
    
    
    (11,768
    )
    
    
    27,363Net revenue for current year period
    
    $
    214,194
    
    
    $
    471,528Organic net revenue (decline) growth as a percentage of
net revenue for prior year period
    
    
    (4.4
    )%
    
    
    2.9
    %
  21




---



##### 



Three Months Ended
    
    Six Months EndedDecember 31,
    
    December 31,2008
    
    2007
    
    2008
    
    2007Income from operations
    
    $
    13,633
    
    
    $
    17,076
    
    
    $
    36,163
    
    
    $
    34,134Operating margin
    
    
    6.4
    %
    
    
    7.6
    %
    
    
    7.7
    %
    
    
    7.7
    %
  Non-GAAP Financial Measures
   Financial Condition and Liquidity
  Cash Flows
  22




---



##### 



Six Months EndedDecember 31,2008
    
    
    2007Cash provided from operating activities
    
    $
    190,243
    
    
    $
    250,286Cash used for investing activities
    
    
    (175,829
    )
    
    
    (103,862
    )Cash used for financing activities
    
    
    (58,119
    )
    
    
    (140,489
    )Effect of exchange rate changes on cash
    
    
    (13,229
    )
    
    
    14,742Net (decrease) increase in cash
    
    $
    (56,934
    )
    
    $
    20,677
 Operating Activities
  Investing Activities
  Financing Activities
    Contractual Obligations and Commercial Commitments
  23




---



##### 



Cautionary Statement Regarding Forward-Looking Information
   
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
      24




---



##### 



Item 4. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
   Internal Control Over Financial Reporting
  
 PART II
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  25




---



##### 



Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  Total Numberof SharesTotal Number
    
    
    
    
    
    
    Purchased asof Shares
    
    
    Average Price
    
    
    Part of PubliclyPurchased
    
    
    Paid per Share
    
    
    Announced PlanOctober 1
 October 31Common Stock
    
    
    
    
    
    $
    
    
    
    
    Class A Common Stock
    
    
    21
    
    
    $
    16.27
    
    
    
    November 1
 November 30Common Stock
    
    
    2,000
    
    
    $
    13.33
    
    
    
    2,000Class A Common Stock
    
    
    875
    
    
    $
    12.38
    
    
    
    875December 1
 December 31Common Stock
    
    
    
    
    
    $
    
    
    
    
    Class A Common Stock
    
    
    
    
    
    $
    
    
    
    
    Total
    
    
    2,896
    
    
    $
    13.07
    
    
    
    2,875
  
 Item 4. Submission of Matters to a Vote of Security Holders
   For
    
    WithheldEdgar D. Jannotta
    
    
    81,973,353
    
    
    
    9,704,969John H. Krehbiel, Jr.
    
    
    88,016,656
    
    
    
    3,661,666Donald G. Lubin
    
    
    84,746,201
    
    
    
    6,932,121Robert J. Potter
    
    
    84,953,831
    
    
    
    6,724,491
 26




---



##### 



Michelle L. Collins
    
    Fred L. Krehbiel
    
    David L. LandsittelJoe W. Laymon
    
    James S. Metcalf
    
    Michael J. BirckFrederick A. Krehbiel
    
    Kazumasa Kusaka
    
    Martin P. Slark
 BrokerFor
    
    Against
    
    Abstain
    
    Nonvotes(2) Approval of Molex Incorporated Annual Incentive Plan
    
    
    82,641,574
    
    
    
    3,022,619
    
    
    
    39,535
    
    
    
    5,974,594(3) Approval of 2008 Molex Stock Incentive Plan
    
    
    80,491,231
    
    
    
    5,170,564
    
    
    
    41,933
    
    
    
    5,974,594(4) Ratification of the selection of Ernst & Young, LLP
    
    
    91,318,838
    
    
    
    320,058
    
    
    
    39,426
    
    
    
    0
 
 Item 6. Exhibits
 Number
    
    Description31
    
    Rule 13a-14(a)/15d-14(a) Certifications31.1      Section 302 certification by Chief Executive Officer31.2      Section 302 certification by Chief Financial Officer32
    
    Section 1350 Certifications32.1      Section 906 certification by Chief Executive Officer32.2      Section 906 certification by Chief Financial Officer
 27




---



##### 



SIGNATURES
  MOLEX INCORPORATED
(Registrant)Date: January 30, 2009
    /S/ DAVID D. JOHNSONDavid D. JohnsonExecutive Vice President, Treasurer and

Chief Financial Officer

(Principal Financial Officer) 28