Harman International Returns to Positive Operating Income, Excluding Non-Recurring Items

http://www.businesswire.com/news/home/20091029006361/en

* Multibillion dollar new awards and emerging market activities position company
for growth
* Record new product introductions and strong innovation pipeline help gain
market share
* Strong cash position provides sound base for organic and inorganic growth
opportunities

STAMFORD, Conn.--(Business Wire)--
Harman International Industries, Incorporated (NYSE: HAR) today announced
results for the First Quarter FY 2010 ending September 30, 2009. Net sales for
the quarter were $757 million, a decrease of 13 percent compared to the same
period last fiscal year. Excluding foreign currency translation, net sales
declined by 10 percent. Sequentially, sales increased 13 percent compared to the
previous quarter. Excluding non-recurring items, the first quarter generated a
non-GAAP operating profit of $5 million, compared to a non-GAAP operating loss
of ($34) million for the previous quarter. On the same non-GAAP basis, loss per
diluted share was ($0.05) for the quarter compared to earnings of $0.47 for the
same period last fiscal year. On a GAAP basis, loss per diluted share was
($0.14) for the quarter compared to earnings per share of $0.36 during the same
period last fiscal year.

"It is clear that Harman`s aggressive initiatives to optimize costs, improve
productivity and drive innovation are bearing fruit," said Dinesh C. Paliwal,
the Company`s Chairman, President and CEO. "Our key markets are stabilizing, we
are gaining market share, and we posted double-digit sequential sales growth for
the quarter - aided in part by various stimulus programs. Our operating income,
excluding non-recurring items, has turned positive. Harman is recognized as a
strong global company with a fast-growing footprint in the emerging markets, and
major customers including BMW, Daimler and Toyota have chosen us for repeat
business due to our track record of successful execution and technology
leadership. These achievements have contributed to an estimated $10 billion in
total awarded business which we will deliver over several years. Despite the
continued global economic challenges, I am pleased with the major progress we
have made in lowering our cost base while investing heavily in innovation. The
$400 million cost savings and operational excellence initiatives that we
launched in June 2008 are ahead of target in delivering sustainable benefits."

FY 2010 Key Figures - Total Company Three Months Ended September 30
Increase
(Decrease)
$ millions (except per share data) Q1 10 Q1 09 Including Excluding
Currency Currency
Changes Changes(2)
Net sales 757 869 (13%) (10%)
Gross profit 200 242 (18%) (16%)
Percent of net sales 26.3% 27.8%
Operating income (loss) (1) 32 n.m. n.m.
Percent of net sales (0.2%) 3.7%
Net Income (loss) (9) 21 n.m. n.m.
Diluted earnings (loss) per share (0.14) 0.36
Restructuring-related costs 4 10
Goodwill impairment charge 3 0
Non-GAAP
Gross profit1 200 248 (19%) (18%)
Percent of net sales1 26.4% 28.5%
Operating income (loss)1 5 43 n.m n.m.
Percent of net sales1 0.7% 4.9%
Net Income (loss)1 (4) 28 n.m. n.m.
Diluted earnings (loss) per share1 (0.05) 0.47
Shares outstanding - diluted (in millions) 69 59
1,2 A non-GAAP measure, see reconciliations of non-GAAP measures later in this release. n.m. = Not Meaningful

Summary of Operations Fiscal 2010 - First Quarter

Net sales in the first quarter were $757 million, a decrease of 13 percent or 10
percent when adjusted for constant currency compared to the prior year. Net
sales declined in all three divisions primarily due to the global economic
downturn. Sequentially, sales were up 13 percent compared to the previous
quarter.

Gross margin on a non-GAAP basis in the first quarter decreased 2.1 percentage
points to 26.4 percent compared to the same period last year. The gross margin
decline was primarily due to a decrease in factory utilization associated with
lower sales and the ramp up of new infotainment product launches in the
Automotive Division. Restructuring costs included in costs of sales were $1
million which consisted primarily of accelerated depreciation related to the
closure of manufacturing facilities.

SG&A expense on a non-GAAP basis in the first quarter was $195 million compared
to $205 million in the same period last year. Restructuring costs excluded from
non-GAAP SG&A were $3 million which were primarily related to the Company`s STEP
Change program. Foreign currency translation contributed $6 million to the
decrease in SG&A expense.

Operating income on a non-GAAP basis in the first quarter was $5 million
compared to operating income of $43 million in the same period last year. On a
GAAP basis, operating loss was ($1 million) compared to operating income of $32
million during the same period of the prior year.

Harman continues to execute ahead of schedule on its $400 million STEP Change
cost-savings program. The Company has achieved $243 million in permanent savings
through September 30, 2009, compared to a target of $197 million. The Company
announced several new restructuring initiatives since its last reporting period,
including a sharper focus on engineering and R&D at its facilities in Bridgend,
United Kingdom and Vienna, Austria. Manufacturing activities at both sites will
be shifted to a new 40,000 sq. ft. expansion of the Company`s plant in
Székesfehérvár, Hungary with the support of several government incentives.

At September 30, 2009, the Company`s cash and cash equivalents balance was $540
million compared to $195 million in the same period of the prior year. The
increase in cash was primarily the result of increased borrowing from the
Company`s revolving credit facility combined with the net proceeds from the
Company`s common stock offering in June 2009.

Harman conducted several significant customer events in recent weeks, formally
unveiling a scalable, next-generation infotainment system that allows automakers
to select a greater range of features and price points and addresses an
estimated $5 billion market largely untapped by Harman. The Company has received
the first award for this new system from a leading global automaker, Toyota, as
outlined in the automotive section below.

Harman also announced that it has accepted a multi-year role as Official Sound
Partner to the GRAMMY Awards, building upon a successful relationship that began
earlier this year. The Company recently received a special GRAMMY award
recognizing Harman`s decades of contribution in advancing sound technology,
underscoring its position as the industry`s top professional sound solution
provider and the loyalty of customers and partners.

"Our intense focus on Operational Excellence is revealed in both our financial
metrics and the spirit of our team," said Paliwal. "Our balance sheet is
healthy, our innovation pipeline is robust, and our loyal customers are
rewarding us with significant new business. We are energized and we expect to
emerge from the current economic environment as a stronger and more profitable
competitor."

Investor Call on October 29, 2009

NOTE: For reference during its analyst and investor conference call,the Company
has posted a set of informational slides on its web site at www.harman.com and
accompanying this press release on www.businesswire.com.

At 4:40 p.m. EDT today, Harman`s management will host an analyst and investor
conference call to discuss the first quarter results. Those who wish to
participate in the call should dial (800) 288-8960 (US) or +1 (612) 234-9959
(International), and reference Harman International.

A replay of the call will also be available following the completion of the call
at approximately 6:40 p.m. EDT. The replay will be available through November
27, 2009. To listen to the replay, dial (800) 475-6701 (US) or +1 (320) 365-3844
(International), Access Code: 119850.

AT&T will also be web-casting the presentation. The web-cast can be accessed at
http://65.197.1.15/att/confcast, enter the Conference ID: 119850 and click Go.
There will also be a link to the web-cast at www.harman.com. Participation
through the web-cast will be in listen-only mode. If you need technical
assistance, call the toll-free AT&T Conference Casting Support Help Line at
(888) 793-6118 (US) or +1 (678) 749-8002 (International).

General Information

Harman International (www.harman.com) designs, manufactures and markets a wide
range of audio and infotainment products for the automotive, consumer and
professional markets. The Company maintains a strong presence in the Americas,
Europe and Asia and employs approximately 9,500 people worldwide. The Harman
International family of brands spans some 16 leading names including AKG®,
Audioaccess®, Becker®, BSS®, Crown®, dbx®, DigiTech®, Harman Kardon®, Infinity®,
JBL®, Lexicon®, Mark Levinson®, Revel®, QNX®, Soundcraft® and Studer®. The
Company`s stock is traded on the New York Stock Exchange under the symbol 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 are
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act.One should not place undue reliance on these statements.We base
these statements on particular assumptions that we have made in light of our
industry experience, as well as our perception of historical trends, current
market conditions, current economic data, expected future developments and other
factors that we believe are appropriate under the circumstances.These statements
involve risks and uncertainties that could cause actual results to differ
materially from those suggested in the forward-looking statements, including but
not limited to (1) our ability to successfully implement our strategic
initiatives, including our STEP Change cost reduction initiatives, and to
achieve the intended benefits and anticipated savings of those initiatives; (2)
automobile industry sales and production rates and the willingness of automobile
purchasers to pay for the option of a premium audio system and/or a
multi-function infotainment system; (3) changes in consumer confidence and
spending and worsening economic conditions worldwide; (4) customer acceptance of
our consumer and professional products; (5) the bankruptcy or financial
deterioration of one or more of our major customers or suppliers; (6) the loss
of one or more significant customers, including our automotive manufacturer
customers, or the loss of a significant platform with an automotive customer;
(7) changes in interest rates and availability of financing affecting corporate
and consumer spending, including the effects of continued volatility and further
deterioration in the financial and credit markets; (8) fluctuations in currency
exchange rates, particularly with respect to the value of the U.S. dollar and
the euro, and other risks inherent in international trade and business
transactions; (9) warranty obligations for defects in our products; (10) our
ability to satisfy automotive contract performance criteria, including our
ability to meet technical specifications and due dates on new platforms, at
expected profit margins; (11) competition in the automotive, consumer or
professional markets in which we operate, including pricing pressures in the
market for personal navigation devices; (12) our ability to achieve cost
reductions and other benefits in connection with the restructuring of our
manufacturing, engineering and administrative organizations; (13) model-year
changeovers and customer acceptance in the automotive industry; (14) our ability
to enforce or defend our ownership and use of intellectual property; (15) our
ability to maintain a competitive technological advantage within the systems,
services and products we provide into the market place; (16) our ability to
effectively integrate acquisitions made by us or manage restructuring and cost
migration initiatives; (17) our ability to comply with financial or other
covenants in our long-term debt agreements; (18) limitations on our ability to
borrow funds under our existing credit facilities; (19) valuation of certain
assets, including goodwill, investments and deferred tax assets, considering
recent market conditions and operating results; (20) strikes, work stoppages and
labor negotiations at our facilities or at a facility of one of our significant
customers, or work stoppages at a common carrier or a major shipping location;
(21) commodity price fluctuations; (22) availability of key components for the
products we manufacture; (23) the outcome of pending or future litigation and
other claims, including, but not limited to the current stockholder and ERISA
lawsuits; and (24) other risks detailed in Harman International`s Annual Report
on Form 10-K for the fiscal year ended June 30, 2009 and other filings made by
Harman International with the Securities and Exchange Commission.We undertake no
obligation to publicly update or revise any forward-looking statement.

APPENDIX
Automotive Division

FY 2010 Key Figures - Automotive Three Months Ended September 30
Increase
(Decrease)
$ millions Q1 10 Q1 09 Including Excluding
Currency Currency
Changes Changes
Net sales 543 617 (12%) (9%)
Gross profit 126 154 (18%) (17%)
Percent of net sales 23.2% 24.9%
Operating income (loss) (5) 20 n.m. n.m.
Percent of net sales (0.9%) 3.3%
Restructuring-related Costs 3 9
Goodwill impairment charge 3 0
Non-GAAP
Gross profit 126 159 (21%) (20%)
Percent of net sales 23.2% 25.8%
Operating income (loss) 1 30 n.m. n.m.
Percent of net sales 0.3% 4.8%
n.m. = Not Meaningful

Automotive net sales for the quarter ended September 30, 2009 were $543 million,
a decrease of 12 percent or 9 percent when adjusted for constant currency
compared to the prior year. Sequentially, the sales were up 17 percent compared
to the previous quarter. Gross margin on a non-GAAP basis in the first quarter
decreased 2.6 percentage points to 23.2 percent. The gross profit margin decline
was due to lower contribution margin related to the ramp up of new infotainment
product launches, partly offset by reduced warranty expense and lower
manufacturing costs resulting from the STEP Change program.

SG&A expense on a non-GAAP basis in the first quarter was $124 million compared
to $129 million in the prior year, representing a decrease of $5 million. STEP
Change savings contributed positively to the year-over-year cost reduction.

The Harman Automotive Division has received three significant multi-year audio
and infotainment awards since its last reporting period. Daimler has selected
Harman to provide the premium infotainment systems for its future Mercedes C-
and S-Class models. BMW has selected Harman infotainment across its full range
of future models. The Company also announced today that is has been selected by
Toyota to provide Harman infotainment on Toyota vehicles sold in Europe
beginning in calendar year 2011. This is the first application of the Company`s
recently-launched scalable, next-generation infotainment system. In addition,
Harman was selected to provide premium branded audio systems on future Toyota
4Runner and Land Cruiser models in the US, Europe and Middle East.

"We are well positioned to seize additional growth opportunities based on our
proven track record for technology and execution, our energy-saving Green Edge
audio and infotainment solutions and our next-generation active noise management
solutions for conventional, hybrid and electric vehicles," said Paliwal.

Consumer Division

FY 2010 Key Figures - Consumer Three Months Ended September 30
Increase
(Decrease)
$ millions Q1 10 Q1 09 Including Excluding
Currency Currency
Changes Changes
Net sales 84 102 (17%) (16%)
Gross profit 22 26 (17%) (15%)
Percent of net sales 26.1% 25.9%
Operating income (loss) 1 (1) n.m. n.m.
Percent of net sales 0.9% (1.4%)
Restructuring-related costs 0 0
Non-GAAP
Gross profit 22 26 (17%) (15%)
Percent of net sales 26.1% 25.9%
Operating income (loss) 1 (1) n.m. n.m.
Percent of net sales 1.0% (1.0%)
n.m. = Not Meaningful

Consumer net sales for the quarter ended September 30, 2009 were $84 million, a
decrease of 17 percent or 16 percent when adjusted for constant currency
compared to the prior year. Sequentially, sales were up 20 percent compared to
the previous quarter. Gross margin on a non-GAAP basis in the first quarter
increased 0.2 percentage points to 26.1 percent. The increase was primarily the
result of the successful launch of new products.

SG&A expense on a non-GAAP basis in the first quarter was $21 million compared
to $27 million in the same period of the prior year, representing a decrease of
$6 million. The improvement was primarily due to cost savings realized from the
STEP Change program.

Harman`s Consumer Division launched a new dealer-focused strategy at IFA Berlin
2009, the world`s largest show for consumer electronics, and received more than
$30 million in orders at this event. Harman Consumer products were honored with
several leading industry awards, including Japan`s Good Design Award for the JBL
SAS-100; the Red Dot Design Award for two AKG headphones; and the European
Imaging and Sound Association (EISA) Award for the Harman Kardon HK990
amplifier. JBL headphones from the Company`s partnership with fashion leader
Roxy were featured as "must have" products by ABC`s Good Morning America and
Life & Style Weekly Magazine.

"Our improved focus on new product introductions and targeted marketing is
paying off with new wins for the Consumer Division that will improve both its
performance and overall brand penetration across our businesses," said Paliwal.

Professional Division

FY 2010 Key Figures - Professional Three Months Ended September 30
Increase
(Decrease)
$ millions Q1 10 Q1 09 Including Excluding
Currency Currency
Changes Changes
Net sales 121 141 (14%) (13%)
Gross profit 46 56 (17%) (16%)
Percent of net sales 38.2% 39.3%
Operating income 17 21 (21%) (21%)
Percent of net sales 13.8% 15.0%
Restructuring-related costs 1 0
Non-GAAP
Gross profit 47 56 (16%) (15%)
Percent of net sales 38.7% 39.4%
Operating income 17 21 (18%) (19%)
Percent of net sales 14.4% 15.1%

Professional net sales for the quarter ended September 30, 2009 were $121
million, a decrease of 14 percent or 13 percent when adjusted for constant
currency compared to the same period in the prior year. Sequentially, the sales
were down 2 percent compared to the previous quarter. Gross margin on a non-GAAP
basis in the first quarter decreased 0.7 percentage points to 38.7 percent.

SG&A expense on a non-GAAP basis in the first quarter was $29 million compared
to $34 million in the same period of the prior year, representing a decrease of
$5 million. The improvement was primarily due to tight cost controls implemented
across all business units.

The Harman Professional Division has been awarded several significant audio
system projects in the Asian markets. These include seven key venues at the 2010
Commonwealth Games in New Delhi, India and all four permanent venues for World
Expo Shanghai 2010. The Company`s Studer mixing console unit has received an
order for more than 80 digital OnAir consoles from the British Broadcasting
Corporation (BBC). Harman systems supported numerous leading artists and venues
during the quarter, including Deep Purple, Eric Clapton and Steve Winwood, House
of Blues, Marcus Theaters, American Airlines Arena, Georgia Tech Stadium, and
the Darmstadt National Theater.

"Building upon our clear leadership in professional audio, we are evaluating
both organic growth and acquisition opportunities to expand our market
coverage," said Paliwal.

Other (QNX and Corporate)

FY 2010 Key Figures - Other Three Months Ended September 30
Increase
(Decrease)
$ millions Q1 10 Q1 09 Including Excluding
Currency Currency
Changes Changes
Net sales 9 9 (4%) (4%)
Gross profit 5 7 (17%) (17%)
Percent of net sales 59.3% 68.8%
Operating income (loss) (14) (8) n.m. n.m.
Percent of net sales (158%) (82.2%)
Restructuring-related costs 0 1
Non-GAAP
Gross profit 5 7 (17%) (17%)
Percent of net sales 59.3% 68.8%
Operating income (loss) (14) (7) n.m. n.m.
Percent of net sales (156%) (73.6%)
n.m. = Not Meaningful

SG&A expense on a non-GAAP basis in the first quarter was $20 million compared
to $14 million in the same period of the prior year, representing an increase of
$6 million. The unfavorable variance was primarily due to stock option
forfeiture credits recorded in the prior year period due to the retirement of
senior executives.

QNX Software Systems recently won the prestigious Adobe MAX competition for
innovative software applications in the Mobile category. QNX has become the
first automotive software supplier to join the Open Screen Project for rich,
interactive applications. QNX also announced several modular enhancements to its
Connected Automotive Reference (CAR) initiative, including Google Local Search,
Virtual Mechanic, and Application Store Technology for easy implementation in
automotive applications. Power transmission and distribution provider AREVA has
selected the QNX operating system for protection and control systems in high
voltage substations.

"Our QNX software unit is opening up new market opportunities well beyond its
established role as a powerful enabling technology for our core audio and
infotainment businesses," said Paliwal.

HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

($000s omitted except per share amounts)

(unaudited)

Three Months Ended
September 30,
2009 2008
Net sales $ 757,368 $ 869,190
Cost of sales 557,826 627,260
Gross profit 199,542 241,930

Selling, general and 201,041 209,473
administrative expenses
Operating income (loss) (1,499 ) 32,457

Other expenses:
Interest expense, net 9,557 3,402
Miscellaneous, net 1,319 989
Income (loss) before income taxes (12,375 ) 28,066

Income tax expense (benefit) (4,577 ) 7,111
Net income (loss) (7,798 ) 20,955
Less: Net Income (loss) attributable
to noncontrolling interest 1,675 (34 )
Net Income (loss) attributable to
Harman International Industries Inc. $ (9,473 ) $ 20,989

Basic earnings (loss) per share $ (0.14 ) $ 0.36
Diluted earnings (loss) per share $ (0.14 ) $ 0.36

Shares outstanding - Basic 69,254 58,658
Shares outstanding - Diluted 69,254 58,828

HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

($000s omitted)

(unaudited)

September September
30, 30,
2009 2008
ASSETS
Current assets
Cash and cash equivalents $ 540,163 $ 195,135
Accounts receivable 510,224 533,711
Inventories 364,619 406,741
Other current assets 171,870 222,410
Total current assets 1,586,876 1,357,997

Property, plant and equipment 501,284 575,347
Goodwill 81,411 413,958
Deferred tax assets, long term 282,594 171,973
Other assets 103,619 115,712

Total assets $ 2,555,784 $ 2,634,987

LIABILITIES AND SHAREHOLDERS` EQUITY
Current liabilities
Current portion of long-term debt $ 637 $ 585
Accounts payable 283,114 301,917
Accrued liabilities 391,896 376,971
Accrued warranties 99,502 121,702
Income taxes payable 11,285 20,307
Total current liabilities 786,434 821,482

Borrowings under revolving credit facility 224,656 25,000
Long-term debt 352,963 339,307
Other non-current liabilities 164,703 146,038
Total Liabilities 1,528,756 1,331,827

Harman International shareholders` equity 1,024,567 1,303,160
Noncontrolling interest 2,461 --
Total equity 1,027,028 1,303,160

Total liabilities and equity $ 2,555,784 $ 2,634,987

HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

($000s omitted except per share amounts) (unaudited)

Three Months Ended
September 30, 2009
GAAP Adjustments Non-GAAP
Net sales $ 757,368 -- $ 757,368
Cost of sales 557,826 $(536)a 557,290
Gross profit 199,542 536 200,078

Selling, general and 201,041 (6,429)b,c 194,612
administrative expenses
Operating income (loss) (1,499 ) 6,965 5,466

Other expenses:
Interest expense, net 9,557 -- 9,557
Miscellaneous, net 1,319 -- 1,319
Income (loss) before income taxes (12,375 ) 6,965 (5,410 )

Income tax expense (benefit) (4,577 ) 1,086d (3,491 )
Net income (loss) $ (7,798 ) $ (1,919 )
Less: Net Income (loss) attributable
to noncontrolling interest 1,675 -- 1,675
Net Income (loss) attributable to
Harman International Industries Inc. $ (9,473 ) -- $ (3,594 )

Basic earnings (loss) per share $ (0.14 ) $ (0.05 )
Diluted earnings (loss) per share $ (0.14 ) $ (0.05 )

Shares outstanding - Basic 69,254 69,254
Shares outstanding - Diluted 69,254 69,254

(a) Restructuring charges in Cost of Sales in the amount of $0.5 million were
recorded during the first quarter of fiscal 2010. These charges were taken to
increase efficiency in manufacturing functions.

(b) Restructuring charges in SG&A in the amount of $3.4 million were recorded
during the first quarter of fiscal 2010. These charges were taken to increase
efficiency in manufacturing, engineering and administrative functions.

(c) A goodwill impairment charge of $3.0 million was incurred during the first
quarter of fiscal 2010.

(d) The tax benefits are calculated by multiplying the actual restructuring
charge in each individual country by the discrete tax rate within that specific
country. This weighted average calculation yielded a tax benefit rate of 27.5%.
Prior period tax benefit used the same calculation methodology, but assumed that
80% of the restructuring expenses would be of US origin and the remaining 20%
would be of German origin. Tax benefits, if any, applied to goodwill impairment
expense are based on discrete transactions and disclosed in the goodwill
impairment footnotes of our recent SEC filings.

Harman International has provided a reconciliation of non-GAAP measures in order
to provide the users of these financial statements with a better understanding
of our restructuring and goodwill impairment charges incurred during the first
quarter of fiscal 2010.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 our consolidated financial statements prepared in
accordance with US GAAP.

HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

($000s omitted except per share amounts)

(unaudited)

Three Months Ended
September 30, 2008
GAAP Adjustments Non-GAAP
Net sales $ 869,190 -- $ 869,190
Cost of sales 627,260 $(5,611)a 621,649
Gross profit 241,930 5,611 247,541

Selling, general and 209,473 (4,869)a 204,604
administrative expenses
Operating income (loss) 32,457 10,480 42,937

Other expenses:
Interest expense, net 3,402 -- 3,402
Miscellaneous, net 989 -- 989
Income (loss) before income taxes 28,066 10,480 38,546

Income tax expense (benefit) 7,111 3,563 b 10,674
Net income (loss) 20,955 6,917 27,872
Less: Net Income (loss) attributable
to noncontrolling interest (34 ) -- (34 )
Net Income (loss) attributable to
Harman International Industries Inc. $ 20,989 $ 6,917 $ 27,906

Basic earnings (loss) per share $ 0.36 $ 0.48
Diluted earnings (loss) per share $ 0.36 $ 0.47

Shares outstanding - Basic 58,658 58,658
Shares outstanding - Diluted 58,828 58,828

(a) Restructuring charges in the aggregate amount of $10.5 million were recorded
during the first quarter to increase efficiency in manufacturing, engineering
and administrative operations.

(b) Weighted average tax benefit of 34% used based on assumption that 80% of the
expenses would be US origin at a 35% rate and the remaining 20% would be German
origin at a 28.5% rate.

Harman International has provided a reconciliation of non-GAAP measures in order
to provide the users of the financial statements with a better understanding of
our restructuring charges incurred during the first quarter of fiscal 2009.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 our
consolidated financial statements prepared in accordance with US GAAP.

HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED

RECONCILIATION OF NON-GAAP MEASURES EXCLUDING EFFECT OF FOREIGN CURRENCY TRANSLATION

($000s Omitted)

Three Months Ended Increase
September 30,
2009 2008 (Decrease)
Net sales $ 757,368 $ 869,190 (13 %)
Effect of foreign currency translation1 - (25,551 )
Net sales, excluding effect of foreign currency translation 757,368 843,639 (10 %)

Operating income (loss) (1,499 ) 32,457 n.m.
Effect of foreign currency translation1 - 2,133
Operating income (loss), excluding effect of foreign currency translation (1,499 ) 34,590 n.m.

Net income (loss) attributable to Harman International Industries Inc. (9,473 ) 20,989 n.m.
Effect of foreign currency translation1 - 2,582
Net income (loss), excluding effect of foreign currency translation, attributable to Harman International Industries Inc. $ (9,473 ) $ 23,571 n.m.

1Impact of restating prior year results at current year foreign exchange rates.

Harman International has provided a reconciliation of the non-GAAP measures in
the table above to provide the users of the financial statements with a better
understanding of the Company`s performance.Because changes in currency exchange
rates affect our reported financial results, we show the rates of change both
including and excluding the effect of these changes in exchange rates.We
encourage readers of our financial statements to evaluate our 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 our consolidated financial
statements prepared in accordance with US GAAP.

Photos/Multimedia Gallery Available:
http://www.businesswire.com/cgi-bin/mmg.cgi?eid=6087163&lang=en

Harman International
Robert V. Lardon, 203-328-3517
Vice President, Investor Relations
robert.lardon@harman.com

Copyright Business Wire 2009