Jennifer Crawford - Manager of Investor Relations Marvin Edwards - President, Chief Executive Officer and Director Mark Olson - Executive Vice President and Chief Financial Officer Philip Armstrong - Senior Vice President, Corporate Finance.

Amir Rozwadowski - Barclays Jess Lubert - Wells Fargo Rod Hall - JPMorgan Kulbinder Garcha - Credit Suisse George Notter - Jefferies Simon Leopold - Raymond James Steven Fox - Cross Research Shawn Harrison - Longbow Research Ana Goshko - Bank of America Merrill Lynch Mark Sue - RBC Capital Markets Brian Modoff - Deutsche Bank.

Good morning. My name is Jennifer and I will be your conference operator today. At this time, I would like to welcome everyone to the CommScope First Quarter 2015 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] Thank you.

I would now like to turn the call over to Jennifer Crawford, Manager of Investor Relations. Ma'am, you may begin..

Thank you, Jennifer. Good morning and thank you for joining us today to discuss CommScope’s first quarter 2015 results.

With me on the call are Eddie Edwards, CommScope’s President and CEO, Mark Olson, CommScope’s Executive Vice President and CFO and Phil Armstrong, CommScope’s Senior Vice President of Corporate Finance You can find the slides that accompany this review on our Investor Relations website.

Before we begin the presentation, I will cover a few housekeeping items. On Slide 2, you will find our cautionary language related to forward-looking statements.

During this conference call, we will make forward-looking statements regarding our financial position, plans and outlook that are based on information currently available to management, management's belief and a number of assumptions concerning future events.

Forward-looking statements are not a guarantee of performance and are subject to a number of uncertainties and other factors which could cause the actual results to differ materially from those currently expected.

For a more detailed description of factors that could cause such a difference, please see our first quarter 2015 10-Q and other SEC filings. In providing forward-looking statements the company is not undertaking any duty or obligation to update these statements as a result of new information, future events or otherwise.

Please note that all dollar figures and percentages are approximations. In addition to GAAP information, we will provide certain non-GAAP measures. We believe that presenting these non-GAAP or adjusted measures provides additional meaningful information to investors.

Detailed reconciliations of GAAP to adjusted measures can be found in the appendix to our slide presentation. Slide 3 is our agenda for this morning. Mark Olson will provide an overview of the quarter, highlight our three segments performance, discuss balance sheet, cash flow and capital structure and then provide our outlook for the second quarter.

He will then turn the call over to Eddie Edward for an update on the planned acquisition of TE Connectivity’s Telecom, Enterprise and Wireless businesses which we will refer to as the BNS business and closing comments before we open the line for Q&A.

To make sure everyone has the opportunity to ask a question on today's call we request you ask one question and return to the queue for any additional questions. I will now turn it over to Mark Olson.

Mark?.

Thanks Jennifer, and good morning all. And now let's turn to slide 4, for a summary of our first quarter. Sales in the quarter were $825 million, consistent with our guidance were down 12% year-over-year. Broadband and Enterprise growth were offset by lower Wireless sales.

Additionally foreign exchange rate changes had a negative impact of 3% in the quarter compared to the prior year period. Orders booked in the quarter also reflect the slow start to North American Wireless spending. Orders were $814 million which provided a book-to-bill ratio of approximately 0.99 times.

GAAP operating income in the quarter was $93 million. Adjusted operating income which excludes the amortization of purchased intangible assets and other special items decreased 18% year-over-year to $156 million or 19% of sales. We were pleased to maintain solid margins despite the decline in sales and a significant shift in the geographic mix.

Sales in the U.S. represented about 46% of total sales in the quarter compared to 60% of sales in the first quarter of 2014. For the quarter the company reported net income of $39 million or $0.20 per diluted share.

Excluding special items, non-GAAP adjusted net income was $81 million or $0.42 per diluted share, which exceeded our guidance for the quarter. Our operating performance declined year-over-year due to weaker wireless results partially offset by revenue growth and margin expansion in both the Enterprise and Broadband segments.

I'll now discuss each of our three segments' first quarter performance starting with the Wireless segment on slide 6. In Wireless we are the global leader in merchant RF wireless network connectivity solutions and small cell DAS solutions.

Our solutions which are marketed primarily under the Andrew brand enable wireless operators to deploy macro and metro cell sites and small cell DAS solutions to meet 2G, 3G and 4G cellular coverage and capacity requirements.

Wireless segment sales declined 21% year-over-year to $496 million primarily due to a temporary slowdown in spending by certain domestic wireless carriers which was partially offset by growth in the Asia Pacific in Central and Latin America regions.

Additionally foreign exchange rate changes negatively affected wireless sales by 4% in the first quarter of this year compared to the prior year period. Our Alifabs acquisition which was completed in June of last year contributed approximately $11 million of incremental sales during the first quarter.

In the quarter Wireless adjusted operating income declined 36% year-over-year to $98 million or 20% of sales primarily due to lower sales volumes. As we previously highlighted extraordinarily strong North American sales in the first half of 2014 were an anomaly.

North American Wireless operators had historically spent more in the second half of the year than in the first half. We continue to expect carriers to return to more of a normalized spending patterns in 2015 and believe wireless carrier spending will strengthen as we move into the second half of the year. However, outside the U.S.

wireless carrier spending remains positive with solid growth in Latin America and particularly robust growth in the Asia Pacific region. On an organic basis we saw continued growth in Europe as well. Despite FX headwinds the strength in our international business gives us confidence.

We expect long-term demand for our wireless products to be positive affected by wireless coverage and capacity expansion in the emerging markets and increased spending on network densification in developed markets. Moving to slide 7, I will discuss our Enterprise segment.

We are the global leader in Enterprise Connectivity solutions for commercial buildings and data centers.

Our compressive solutions sold primarily under the SYSTIMAX and Uniprise brands include optical fiber and twisted pair structured cabling solutions, intelligent infrastructure software, network rack and cabinet enclosures, intelligent building sensors, advanced LED lighting and control systems and network design services.

Enterprise sales increased 5% year-over-year to $211 million. This increase was driven by strong sales of data center fiber solutions and growth in all major geographic regions. Foreign exchange rate changes had a negative impact of approximately 1% on Enterprise segment sales for the first quarter of this year compared to the prior year period.

In the quarter, Enterprise adjusted operating income increased 36% year-over-year to $49 million or 23% of sales. The increase is primarily due to higher sales, lower material costs and a favorable mix of products sold.

We are pleased with Enterprise performance over the past several quarters and with what we're seeing in the market and hearing from our customers.

We remain confident in our long-term growth opportunities and look forward to building upon exciting new solutions like data center on-demand, iTRACS and Redwood Systems as well as the strong enterprise solutions that we will acquire from TE Connectivity. I'll now turn to slide 8 to discuss our Broadband segment.

We are a global leader in providing cable and communications products that support the multichannel video, voice and high-speed data services provided by multiple system operators or MSOs.

We believe we are the leading global manufacturer of coaxial cable or hybrid fiber coaxial networks and a leading supplier of fiber-optic cable for North American MSOs. We are particularly pleased with the performance in our Broadband business. Broadband sales increased 10% year-over-year to $118 million.

The sales growth was primarily driven by increased investment in North America as cable operators continue to expand fiber technology further into their networks to increase the quality of video and broadband offerings. Broadband sales in the first quarter were also higher in the Central and Latin America region compared to the prior year period.

Foreign exchange rate changes had a negative impact of approximately 1% on Broadband segment sales for the first quarter of this year compared to the prior year period.

In the quarter Broadband adjusted operating income increased meaningfully year-over-year to $9 million or 8% of sales primarily due to an increase in sales volumes and the benefits realized from cost reduction initiatives. Our Broadband team delivered another strong quarter.

We expect demand for our Broadband segment products to continue to be influenced by competition among service providers, ongoing maintenance and upgrade requirements and activity in the residential construction market. Next I'll discuss cash flow and liquidity on slide 10.

During the first quarter CommScope generated $1million in cash from operations, invested $8 million in capital expenditures and paid $7 million in transaction and integration costs primarily related to the planned acquisition of BNS business. We expect to generate cash from operating activities for the remainder of the year.

Adjusted free cash flow for the 12 months ended March 31, was $388 million. We ended the quarter with $735 million in cash and cash equivalents and had availability under our credit facility of $284 million which combined with our cash balance provided total liquidity of over $1 billion. On slide 11 I'll discuss our capital structure.

Since the take privately in January 2011, we have reduced our net leverage ratio from five times to 2.4 times by substantially growing earnings and free cash flow.

We continue to expect to generate strong free cash flow during the remainder of 2015 and intend to use a portion of it to minimize the amount we need to borrow to fund the acquisition of the BNS business. We plan to finance the acquisition using a combination of cash on hand and approximately $2.75 billion of additional debt.

We are currently planning to issue the incremental debt during the second quarter and are pleased that the interest rate environment has improved over the last few months. Moody's Investor Service recently confirmed its B1 rating and changed its rating outlook to positive. We expect Standard & Poor's to issue their report in the next few weeks.

Finally I'll talk about our outlook on slide 13. Our guidance excludes the impact of the planned acquisition, amortization of purchased intangibles restructure and costs, transaction and integration costs and other special items.

Our second quarter outlook also reflects the temporary slowdown in North American wireless carrier spending and assumes that foreign exchange rates will remain at current levels.

For the second quarter we expect revenue of $850 million to $900 million up 6% sequentially at the midpoint of the range, adjusted operating income of $160 million to $180 million up 9% sequentially at the midpoint and adjusted earnings of $0.45 to $0.50 per diluted share of 13% sequentially at the midpoint of the range and based on a diluted share count of 194 million shares.

We have also reaffirmed our full-year earnings guidance of $1.95 to $2.05 per diluted share. While it is challenging to predict monthly spending patterns, we do expect North American Wireless spending will improve in the second half of the year and at the same time we continue to exercise prudent spending discipline.

As a result we believe our previously announced full-year earnings guidance remains achievable, although more likely toward the low end of the range as we currently see it. And with that, I'll turn the call over to Eddie to discuss the planned acquisition progress and final thoughts on the quarter before the operator opens the call for Q&A.

Eddie?.

Thank you, Mark. Turning to slide 15, I will give you an update of the progress of our planned acquisition of the BNS business, which we announced in January. During the quarter we spent considerable time focused on ongoing assessment and integration of the new businesses.

We have formed nearly 20 separate functional teams that are working hard on plans that will be implemented after the close of the acquisition. During the quarter we also named Randy Crenshaw our COO to lead these teams in integration and drive successful synergies.

First of Randy's direct reports now report to me and will throughout this integration process. As some of you may know, Randy also led the successful integration of the Avaya Connectivity Solutions carve out in 2004. Based on our ongoing work we are even more confident today in our ability to create synergy savings.

On the regulatory front, we were recently granted early termination of the HSR waiting period by the U.S. Department of Justice. All of this is good news, we're still in the midst of the antitrust regulatory process in numerous other jurisdictions around the globe.

We continue to expect the transaction will close by the end of the year subject to contemplated financing, the remaining regulatory approvals and other customary closing conditions.

In summary, I'd like to thank the global CommScope team for their solid first quarter performance despite a slow start in North American wireless carrier spending and the foreign exchange headwinds that Mark just talked about. Our first quarter performance is a great example of the power diversification.

Our Enterprise and Broadband segments delivered a strong first quarter with growth and improved profitability. Additionally, we saw double-digit year-over-year increase in international wireless sales with particular strength in the Asia Pacific region.

As previously highlighted, we continue to believe North American wireless carrier spending will strength as the year progresses. As we have noted many times, our quarter to quarter wireless business can be lumpy.

However, we believe continued global investment in LTE coverage and capacity over license spectrum will remain a strategic initiative for wireless operators over the long-term. As a result, we remain confident in our long-term growth prospects. We also remain very excited about the pending transformative acquisition of TE's BNS business.

We believe they will strengthen our growth, broaden our footprint and create a substantial value for our customers, employees and the stockholders.

We believe this acquisition will provide CommScope with an opportunity to expand in adjacent wireline telecom networks, ply with the ex-market and meet the steadily growing demand for broadband services in developed and emerging markets.

We also expect the acquisition to substantially expand our foundation of innovation with addition of approximately 7000 patents and patent applications worldwide.

For instance we expect the BNS businesses leading fiber technology to help CommScope better address a transition in fiber deployments deeper into networks and in data centers as consumers and businesses generate increasing bandwidth requirements.

Finally our ongoing integration work has increased our confidence around our ability to drive cost reduction synergies. Overall it was a solid start to the year for the CommScope team. We remain focused on positioning the company for long-term success by delivering profitable growth while managing cost effectively.

Now, we will be happy to answer your question and I'll turn it back to the operator.

So, Jennifer?.

[Operator Instructions] And our first question comes from the line of Amir Rozwadowski with Barclays..

Thank you very much and good morning folks..

Hey Amir..

Good morning, Amir..

I was wondering if we could touch on some of the U.S.

market in general? And then one quick specific question, in terms of overall demand perspective, what gives you the confidence in sort of this back half ramp when it comes to overall demand? Are you having those conversations with respect to your carrier customers? Any initiatives that you're seeing that gives you that confidence that will be helpful? And then secondly, if we think about overall small cell deployment, it does seem like momentum seems to be gaining some traction here.

If you look at what Verizon has been saying in terms of their efforts to ramp up small cell initiatives, we obviously saw an announcement this morning with Crown Castle buying a fiber player to get involved more entrenched in small cells and even some of the other tower operators are talking about increasingly seeing more demand and excited economics when it comes to those types of deployment.

So would love to hear sort of what you folks are seeing with respect to your business? Thanks very much..

Okay, that's a long question. I'll try to remember all of it. You know, we I guess the confidence in the balance of the year and what we've done, two of our businesses started well during the course of the year.

Mark talked about the wireless fall off I guess from what we saw in '14, maybe not so much from what we saw in Q4, but we do talk to our customers here, no different than you guys do and we have talked and looked at what we see for the balance of the year from the top down and from the bottom up.

We've met and visited with all of the appropriate people that we need to, to see what their spend is. We know what their, generally we know what the spends are necessary to complete their plans for the year.

We've verified this with the regions as we can and so I think today we feel confident that what we've told you and while it is less than where we were we think it is appropriate. We feel confident with what we've told you. Now we have the ability to react and we have the ability to help. We do not generate this demand and we don’t place orders.

So it is incumbent upon a couple of our North American customers to help us achieve these targets to make sure that we can do what they tell us they are going to need. So as we sit here today I think the confidence is high based on what they've told us that we will achieve the numbers that Mark has talked about and so we feel confident today.

In the case of small cell, I think what you have said is true and there's been a lot of announcements in the marketplace as to the deployment of small cells, may be less than the full spectrum that we offer in our DAS products, but you know, we do believe that our DAS is a type of a smaller cell, it's certainly not a macro or metro, but it does fit certain categories.

I think we've also said that if we see this market is trending towards something that we need to be in, in a more meaningful way, we plan to do that. So I think all of those things are at our beck and call. You know, I think from the standpoint of our business overall, we are pleased. It is a lumpy business that we have.

It's cyclical certainly in wireless. I think the ability of us to maintain our margins with less revenue than anticipated is the skill that we show in how we control costs and maintain those margins. Being able to serve as a solution provider as opposed to a component seller only is also another strength of CommScope. So overall we are pleased.

It's not what we had a year ago this time. I think everybody understands that, but we think we started well given the market conditions and we're optimistic as we continue through the year..

Thank you very much for the color, Eddie..

Welcome..

You next question is from the line of Jess Lubert with Wells Fargo Securities..

Hi guys..

Good morning, Jess..

Good morning, Jess..

Good morning.

I was hoping you might be able to update us on the revenue outlook for the year, where that might fall versus your previous outlook and from a quarterly perspective would you still expect Q4 to be down versus Q3 levels or given the expected strengthening in the back half of the year might that be different? And then just following up on Amir's question with respect to the U.S., a lot of the big U.S.

carriers recently spent quite a bit on AWS-3 spectrum.

So I was hoping you could help us understanding that expected timing of when you think they will start deploying the spectrum, what that might mean for your business based on historical deployment patterns following similar purchases?.

Jess this is Eddie, and I'll answer the last question first and Mark's answer will be longer, but we have talked to several of them and they have expectations that sometime during the course of this year, probably in the third quarter, they will start spending on the spectrum. At what levels, we are not sure yet, but I think it's going to be quick.

They've paid a lot of money for it and they want to see a return. So we would expect that in the near-term. Maybe not for everybody, but the few that we've talked to..

Does that strengthen in 2016 then?.

I think 2016 from what we hear, they are more optimistic as to what their spending patterns are going to be. Those budgets are a long way off, so but we'll have to see, but that’s the talk we hear..

Yes and Jess, back to your first question related to the outlook for the full-year from a revenue standpoint. You know, we previously guided that flat to down 5%. As you know FX is a headwind to our revenue outlook.

Assuming that FX rates stay approximately where they are at currently, we expect to see about a 3% negative impact to revenue for the calendar year. Now from an earnings standpoint; however, we are very nicely naturally hedged.

And if you look at how FX affected us in the first quarter, we were down 3% on the top line, but from an EPS standpoint that affected us only to the extent of about a penny per share in large part because we are very nicely naturally hedged.

And so to Eddie's comment while we do expect North American wireless spending to improve in the second-half, trying to pick exactly what month that's going to happen in that remains challenging for us and so we do believe that it is going to return.

I think the public commentary out of the two largest carriers in just recent days would also support that and in the meantime we continue to exercise very prudent spending discipline. So all of that gives us comfort in being able to deliver.

We have guided toward the low end of the previous range that we had given, but all of those factors give us comfort of being able to achieve the earnings guidance..

So from a modeling perspective, should we be thinking maybe Q3 and Q4 relatively flat to one another at starting point?.

Well, what we would think about is the second half being in the up mid-single digit type range over the second half of last year in the aggregate..

Thanks guys..

Your next question comes from the line of Rod Hall with JPMorgan..

Yes, hi guys, good morning. Thanks for taking the question. I just wanted to sort of round out that guidance question and then I have a followup.

Just wanted to check to see, you guys, I guess the implication of what you're saying is your revenues, you are expecting revenue to be a little bit lower now and you are willing to reduce costs to keep the earnings in the range and I just wondered on the cost side of things we could talk a little bit about what we might model there, how we should be thinking about that and then I just wanted to follow that one up? Thanks..

You know, Rod, as you know historically cost management is one of the strong suits of the company. If you look for example at SG&A in the first quarter and you take out the special items, we were actually down a couple percent in SG&A over the first quarter last year.

Now we don’t plan to – we don’t have any significant restructuring actions or anything dramatic that is planned, but we will continue to carefully monitor expenses as we moved into what we expect to be a stronger second half of the year.

So at this point again it is a bit of uncertainty as far as the exact timing of the return to more normal patterns. We'll have a better flavor on that here as we move throughout the quarter. But our capability, we've got multiple levers that we can pull. Our natural hedging for example is a nice offset to the FX headwinds that we faced.

So we will carefully manage costs and expect to deliver the earnings that I had commented on earlier..

Okay, alright. Thanks Mark, and so I guess if we are going to reduce the cost in our model, we would kind of spread it at one year or later now, there's no non-linearity in the way that we would naturally be modeling cost over the year..

No, I think that's right..

Okay, and then the other thing that I wanted to ask you is, what I guess it is kind of a two-part question.

What changed your view of the revenue, because you know, a quarter ago you guys felt like you had pretty good visibility? And the second part of that question is obviously we were all caught off guard by the tier 1 spending in Q1, can you give us any color on what you think drove that weak spending and we have some ideas, but you guys are a lot closer to it than us and just be curious to know may be Eddie, if you got any thoughts on what drove the weaker than expected tier 1 spending or was it more like in line with what you guys expected?.

I think the start up when some of the larger U.S. carrier or couple of the carriers, there stared in how they are going to deploy certain things in one case and when they are really going to start spending, it was a guessing game because we got very little visibility from them. We probably underestimated or overestimated the starting point.

And I think we've taken a different view now and as I said earlier, we have gone out to the regions. We've talked with all the people we deal with that actually deploy and we've tried to match that against what we've heard in the headquarters areas and we think we are very, very close to a correlation there between the two.

So we feel more comfortable what we have. As I said earlier, we can address demand needs. I think we showed that last year and the ability of us to flex up and down. We have no capability to cause them to start spending in any specific time. We do feel that that spend will have to occur. There has to be continued improvement in the networks.

None of this changes our viewpoint on the long-term viability of the wireless business or any of the other business at all. We think we are in the sweet spot of this infrastructure business is, but it is lumpy.

If you look back over the course of time when we went public once before and I think even during our private period we did see lumpiness from quarter-to-quarter and so it's nothing new and it is hard to plan for..

Great. Thanks Eddie..

Your next question is from the line of Kulbinder Garcha with Credit Suisse..

Thanks.

I just want to clarify one thing and then just a question on the full year, some of the clarification of the – let's say slightly drop in revenue guidance for the year, for the full year for the business overall is because you have a lower estimation of full year wireless revenues, is that correct or is it mainly communication and sans the reduction on what's going on?.

That's correct..

Okay, thanks and then for the full year then it looks like the wireless business will be down probably somewhere around double-digits and I'm assuming your DAS business is still growing fairly well year-on-year maybe I'm wrong about that for the full year?.

Hey, Kulbinder, could you speak up a little bit, we are having a hard time?.

Yes, can you hear me now?.

Yes, it's better..

Okay, great. Sorry about that. So basically for the full year it looks like your wireless business will be down double-digits and I know there's some currency impact in that, but the DAS business I assume is growing in absolute terms. So your cellular business is declining very quite meaningfully.

Now when you look at that versus the long-term trend that is any of that let's say just under investments, let's say networking that you might see a cyclical recovery in '16 or I am trying to fathom just seeing so much up trend and so much away from '16 for the cellular part, and '15, how we should think about future years afterwards? Thanks..

Let me take a stab at part of that and then Mark can correct everything I say may be, but what we saw in '14 was as we said earlier was an anomaly in spending patterns. You know, it is generally first and fourth quarter the slowest, that's not what we saw.

I mean fourth quarter was less because of a spec had turned off by one of our customers, but there is nothing there that concerns us in the long term and nothing concerns us as to their need to continue to build certainly in the diversification part and even in the macro environment as well.

So that is going to happen, but you had a lot of exuberant spending during the course of '14 that I think if you balance with what we're seeing during so far, during this part of '15, is not abnormal. It is just the timing.

We happen to get report at certain points in time and the timing is if we could average it together it would look great, but that's not how we report. So, but we have no concern at all as to the viability of the market.

The need for people to use bandwidth where it be wireless or wire line, we are absolutely fully engaged endorsing that growth in the market. I think everything you read is, says the same..

You know, over the long-term Kulbinder, our guidance is mid-single digit growth across the company. We view wireless long-term at the upper end of that range. Consider the growth in international wireless during the current quarter. We were up in strong double-digits into the international markets and so very pleased with that.

As Eddie had commented if you were to average '14 and '15 together as far as U.S. wireless sales, you'll have a much more stable, less volatile pattern. But this is the nature of this business and it really speaks to the power of diversification for us..

So, not in your question, but this acquisition that we are doing it balances our portfolio better than it is today. I think it does help take away from that volatility or cyclicality. It also gets us in to a business of fiber-to-the X that we are not be major player.

We will come, be one of the very few major players in this market and that market is growing nicely..

And can you just tell me one thing then, you are talking about your ability to ramp in the second half if this business comes through let's say in the U.S.

What's the kind of all warning lead times just going firmly into orders, how far in the month that would you typically know, is it two months, three months, one month, I am trying to understand the point of which you guys can actually stand up and say this is definitely going to happen now in the second half of this year?.

Well, you know, we've changed our operating structure. We support a lot of the wireless products out of North American or South American facilities and so we have the ability to react quickly from that standpoint and not have to depend upon ships or airplanes or whatever to bring our product to market. So our reaction time is very quick.

You know, the only thing that would be a constraint is our suppliers as to piece parts and things like that.

So I think we showed last year that we were able to ramp up to in the antenna side of our business to levels not seen before and then ramped back down as that demand waned without materially hurting margins on the way down and immensely effecting margins on the way up.

So, that's something that CommScope prides itself upon the ability to be able to react to those market conditions differently than most and I think that's something that we would like to be tested again on..

Thank you Kulbinder, Jennifer, can we have the next question please?.

Thank you. The next question is from the line of George Notter with Jefferies..

Hi guys, thanks very much. I had a couple questions. I wanted to ask about your Asia Pac business, I think you said earlier on the call that the trends there were strong.

I think you were referring more specifically to wireless, but can you just remind us where your exposures are in APAC? I know in China you guys only play there quite selectively, but just talk about the exposures, is it China, where you're seeing the strength, is it other countries? I'd like to get some sense for what's going on there.

And then also you said confidence in merger synergies is higher than I guess before, can you just talk about why that is and what's driving that? Thanks..

Okay, yes we have good business in Indonesia, the island nation of Philippines and places like that. We've seen a lot of 3G deployment in those areas. So from the wireless standpoint our confidence is high, it is high as to how we are there.

India was a very strong market during this quarter and our expectations is that's going to continue for some period of time.

May be the more exciting part other than just revenue we care a lot about cash and margins is the margins that we saw in Asia Pac and in Latin America were very strong and so I think that helped us with lower sales maintain our margin scenarios. So we're excited about that. We did sell solutions more so than components.

I think that's what we've talked about a lot George as to what we strive to do. And so we're seeing that take action, take root..

And then I think the other part of your question was on synergies, okay so we've visited lots of places. And we've talked to a lot of people. There are still a lot of playing scale that we directly compete with the BNS businesses in a lot of areas. There's still a lot of things that we can't ask about and cost data that we can't see.

So we have some testing yet to do and that will happen until after the acquisition in many cases.

But from what we see from what we talked to the people and how they do things, what they make, what we make, how we can put all that together, we feel very comfortable based upon the 31 different discrete items that we've looked at in the process of doing this we feel very comfortable in what we've written down, the $150 plus million.

You know, this is something George that we pride ourselves on, we pride ourselves on given the expectations and then living them, I think we've done that the last two transformative acquisitions. We would expect to do that on this.

We are not going to quantify what that may mean, but we do feel comfortable and positive and without exception we like what we see in this company..

Got it, thank you..

Your next question is from the line of Simon Leopold with Raymond James..

Great, thank you very much. A quick clarification if I might first is in the past you've given us a little bit more color on the contribution from DAS. I think historically talking about it being 20% or so of the Wireless segment sales.

So just wondering if that's trending differently than the overall Wireless segment? And then what I was hoping you could give us a little bit more thoughts on would be Europe, you talked about strength in Asia Pacific and you talked about North America and kind of the absence of Europe Wireless comments sort of stood out.

And in particular I wonder if you face a competitor in Europe who has got a European operation prices in euros and might be being aggressive and if there's some the competitive dynamic related to ForEx? I hope that question makes sense..

Yes, let me take a shot at that Simon and then Eddie can add to it. But first on DAS, DAS as we've talked historically does represent plus or minus 20% of our Wireless business and that the relationship continues today. On the Europe side, most of the ForEx impact in our business was in Europe on wireless. It's probably not surprising.

But absent FX Europe had very nice growth, a continuation of the growth that we've seen there in wireless over the past four or five quarters. We have competitors around the world including in Europe and rather than compete on price we tend to compete on having an overall solution that we can sell.

As well the addition of Alifabs to our portfolio which is today Europe centric. It may expand over time to other regions, but that is growing nicely and it fits right into the sweet spot of LTE deployments, particularly in the UK and now expanding to the continent. So we're very pleased with our European Wireless performance..

Thank you..

And our next question is from the line of Steven Fox with Cross Research..

Thanks, good morning guys.

Can you talk a little bit about the Enterprise business, particularly comments out of your largest distributor that said there may be some pricing pressure coming from the suppliers and then sort of follow-through in the distribution channel? And then within that can you also talked about the margin potential for that business going forward and where you seeing it may go over the rest of the year? Thanks..

Hey, Steve, this is Eddie. We listened to that call you’re talking about, then – there are pressures all the time on pricing. That's something that we face every day. I don’t think we’re seeing any different kind of pressure today.

We sell at the high end of the market in Enterprise and generally we sell a solution warranted end-to-end and so it's not commodity sale from our standpoint. The bulk of our business in copper is 6 and 6A, that’s where out sweet spot is. Our fiber business is growing within the Enterprise with good margins. The data center business is growing also.

So we saw success and I think continued meeting the plan and the targets from the Enterprise guys and our margins are holding. So what we’re seeing, we had a great quarter in the Enterprise business from a margin standpoint near historical levels and so it’s good to be diversified.

Those types of products that we sell here whether it be fiber or twisted pair and I think the market, a part of that market that we serve as a percentage larger is the market that is maybe not immune to price pressure, but it's today at least it is not as affected as maybe other parts of the market are..

Great, and just in terms of the Enterprise margins for the rest of the year..

Yes, we are pleased with the performance of operating margins in Enterprise in particular Steve. That has been a 20% plus or minus performer for a long time. And you saw strength in the data center space and in particular within fiber as Eddie has described. We see that continuing going forward.

23% operating margins were a little bit at the high end of the range at which they’ve operated at for the past several years, but we do expect a 20 percentage type operating margin to be the continued performance within that business..

I think the other parts Steve, is helping is that our emerging products are getting traction. I think we are seeing progress in all three and so as they become less investments and more standing on their own that helps as well, so we’re generally happy with what we’re seeing there..

Great, that’s very helpful. Thanks again..

And your next question is from the line of Shawn Harrison with Longbow. .

Hi, quick follow up to Steve’s question on Enterprise and then another question, good growth you are starting in the year, do you expect kind of mid single digit growth for Enterprise for the year? And then second, just following up on the DNS acquisition, trying to I guess, maybe even put a finer point to may be the bullishness of it, it looks as if they are going to see probably about a 10% growth in the EBIT this year for the business based upon their latest filings.

Is that one of the reasons why you’re more bullish on the accretion or where there other factors or was that just solely on the cost side?.

I think from the synergy side, what we have looked at in the ability of us to help each other as oppose to having to have things made about others is, as we both do today will help. This is purely a 16 thing, we don’t expect anything material this year at all and so, but what we see so far.

And I’m not going to put a fine point on anything because we don’t have a fine point at all because as I said earlier there is a lot of facts that we can’t ask yet because of legal reasons, but from observation, from conversation and looking at the quality of the people, the quality of their technology and their capabilities to manufacture certain things, we feel very optimistic as to what we bought or about to buy and what we can do with it, so we’re happy with that..

And on your enterprise question Shawn, this is the fifth consecutive quarter of growth within our Enterprise segments, so we are pleased with that. We've seen it growing in the low mid single digit range over that period of time and we expect to see that continue throughout the year.

Does it seem as if momentum is building in the business or just kind of holding at the current state?.

Maybe somewhere in between those two, we are sitting, I think positive trends from a data center standpoint as Eddie has just discussed, we do have several new emerging products that are still getting legs under them.

And then there are factors that could move including foreign exchange a little bit in the other direction, but we’re pleased with what we’re seeing. Again, the pattern of growth not just in one or two quarters, but now on a sustained basis gives us optimism here for the balance of the year..

Thanks a lot..

Your next question is from the line of Ana Goshko with Bank of America..

Hi, thanks very much for taking the question.

So, on the plans to issue the $2.75 billion of debt for the acquisition in the second quarter, one I wanted to know if you could update us on the planned mix of secured banks versus unsecured bonds? And two, based upon your current view of the two businesses where the pro forma leverage is?.

Sure Ana, from an update on the mix of secured versus unsecured debt we’re still working through that. Assuming that the markets hold where they are at we do plan at this point to come to market later this quarter. But until we do so we still have a number of variables here.

We've got a lot of optionality in how we structure this and so we plan to take advantage of that. From a leverage standpoint we have talked 4 to 4.5 times publicly and at this point we don’t see any material deviation from that..

Okay, thanks and then any, that I assume that the term loans would be unfunded and the bonds against escrow, so none of that interest expense is yet in your EPS guidance or earnings guidance for the year is that correct?.

All of our guidance has been ex- the transaction. So we have nothing in our outlook right now that considers the transaction..

Got it, okay great. Thank you very much..

Your next question is from the line of Mark Sue with RBC Capital Markets..

Thank you. From my past experience I do have high confidence and that CommScope will hit and exceed the $150 million cost synergies over the longer-term.

With the carrier and equipment consolidation does that actually put some pressure nonetheless on your rate of operating margin improvements once you actually look at all the cost synergies? I’m just trying to see if that external dynamics are making it happen, it will have an impact over the longer term..

I guess so generic answer is, with the consolidations whether it be in the MSO market or the wireless market or whatever all of those people already are our customers and we have significant positions with each of them. You could envision as you consolidate their, these guys have - they can exert a lot of pressure today. They’re all big guys.

They have a lot of leverage and so that’s something that we and our competitors face on an ongoing basis. So, we plan to have cost reductions to offset any pressure that we might see. I think that’s something that if anything we do well that’s something we do very well and I think that we would continue down that road.

So our operations people can do significant things to cut our cost and we’ll continue down that road..

That’s helpful and then Mark just a question, I guess everyone was focused to near-term focus on the wireless uptick if anything you are still planning for internally metrics for improving growth in the wireless and not just waiting for the carriers is that a fair statement?.

Well I think as we've talked Mark, that yes we do have the expectations of resumed more significant spending from the U.S. carriers in the second half. And as we had talked we’re also seeing very nice activity as we had expected in the international markets.

So, all of that together gives us confidence in seeing growth in the second half within our Wireless segment..

That’s so helpful. Thank you, gentlemen. I think it’s shaping up for a very good 2016 as well. Thank you..

Thanks Mark..

Thanks Mark..

[Operator Instructions].

Operator, we may have a technical difficulty here. I think there is Brian Modoff from Deutsche Bank had a question. I don’t know, Brian..

One moment and Brian your line is open. Please proceed with your question..

Thanks Phil. Hey guys, so couple of questions; one, cash flows on the quarter flattish is not seasonal basis better than it what it normally is usually you kind of loose a chunk of money in Q1 you have cash flow issue in Q1.

How do you feel your cash flows are setting up for the year and how might that affect that leverage ratio you discussed and also your flexibility to how you structure the debt? And then the second question, you had a major merger not happen with two cable operators. How might that affect your business in that end as we go through the year? Thanks..

Yes, let me take the first part Brian and you know the, lot of the improvement in the first quarter versus first quarter last year is timing. As we refinanced our 8.25% notes last year that shifted the timing around cash interest payments and so we benefited from that this quarter.

But we still feel very good about the strong cash generation for the full year. We do have a heavier mix of international versus U.S. business compared to a year ago that will put some pressure on the timing of cash collections. But we're talking maybe a matter of weeks.

So we still feel very good about being able to generate the strong cash flow that we have historically. And depending upon exact timing, as to when the debt would close we do plan to maximize use of cash on the balance sheet to minimize the amount of our borrowings..

Yes, the second point we did have a merger that didn’t happen and both of those people are very good customers. They way we planned the year was that we expected that there would be a lull or a rest of whatever as this merger was completed. We don’t anticipate that that will happen now.

So if nothing else changed in the scheme of things there could be some upside, not material in scheme of CommScope, but we'll have to see I think it reinforces and helps to make sure that we achieve numbers, but that would be I think the only expectation that we see..

Maybe they are simply saying is it is not going to change much at all because the rest period they were both spending the normal rates and I think continue to do so today..

Good luck guys..

Thanks..

Thanks Brian..

We have no further questions in our queue at this time and I would like to turn the conference back over to Eddie..

Thank you, Jennifer and thanks all of you our lenders, our analysts and some of our investors, I'm sure they are listening. We think CommScope performed well for the quarter in challenging times. We look forward to continuing to talk with you and we'll see you again next quarter. Thanks very much..

Thank you for your participation. This does conclude today's conference call and you may now disconnect..