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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 10-Q
 
x     Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
 
For the quarterly period ended September 30, 2002
 
or
 
¨     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 1-16489
 
 
FMC Technologies, Inc.
(Exact name of registrant as specified in its charter)
 
 
Delaware
  
36-4412642
(State or other jurisdiction
of incorporation or organization)
  
(I.R.S. Employer
Identification No.)
     
200 East Randolph Drive, Chicago, Illinois
  
60601
(Address of principal executive offices)
  
(Zip code)
     
(312) 861-6000
(Registrant’s telephone number, including area code)
 
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
 
Yes x         No ¨
 
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
 
Class
  
Outstanding at October 31, 2002
Common Stock, par value $0.01 per share
  
65,380,079
 

PART I—FINANCIAL INFORMATION
 
ITEM 1. FINANCIAL STATEMENTS
 
FMC Technologies, Inc. and Consolidated Subsidiaries
Consolidated Statements of Income (Unaudited)
(In millions, except per share data)
 
    
Three Months Ended
September 30
   
Nine Months Ended September 30
  
    
2002
   
2001
   
2002
     
2001
  
Revenue
   
$
525.4
   
$
474.0
   
$
1,491.3
 
   
$
1,381.5
 
Costs and expenses:
                                
Cost of sales and services
   
 
425.0
   
 
363.3
   
 
1,188.7
 
   
 
1,065.6
 
Selling, general and administrative expense
   
 
61.1
   
 
69.5
   
 
199.4
 
   
 
214.1
 
Research and development expense
   
 
11.9
   
 
13.0
   
 
36.0
 
   
 
42.0
 
Asset impairments (Note 2)
   
 
—  
   
 
—  
   
 
—  
 
   
 
1.3
 
Restructuring charges (Note 2)
   
 
—  
   
 
6.3
   
 
—  
 
   
 
15.5
 
    
  
  
  
Total costs and expenses
   
 
498.0
   
 
452.1
   
 
1,424.1
 
   
 
1,338.5
 
    
  
  
  
Income before minority interests, net interest expense and income
taxes
   
 
27.4
   
 
21.9
   
 
67.2
 
   
 
43.0
 
Minority interests
   
 
0.7
   
 
0.1
   
 
1.7
 
   
 
0.7
 
Net interest expense
   
 
3.1
   
 
5.2
   
 
9.8
 
   
 
8.1
 
    
  
  
  
Income before income taxes
   
 
23.6
   
 
16.6
   
 
55.7
 
   
 
34.2
 
Provision for income taxes (Note 3)
   
 
6.8
   
 
5.2
   
 
16.1
 
   
 
16.2
 
    
  
  
  
Income before the cumulative effect of changes in accounting
principles
   
 
16.8
   
 
11.4
   
 
39.6
 
   
 
18.0
 
Cumulative effect of changes in accounting principles, net of income taxes (Notes 4 and 6)
   
 
—  
   
 
—  
   
 
(193.8
)
   
 
(4.7
)
    
  
  
  
Net income (loss)
   
$
16.8
   
$
11.4
   
$
(154.2
)
   
$
13.3
 
    
  
  
  
    
(continued)
 
 
The accompanying notes are an integral part of the consolidated financial statements.

2

FMC Technologies, Inc. and Consolidated Subsidiaries
 
Consolidated Statements of Income (Unaudited) (Continued)
(In millions, except per share data)
 
    
Three Months Ended
September 30
   
Nine Months Ended September 30
  
    
2002
   
2001
   
2002
     
2001
  
Basic earnings (loss) per common share (Note 5):
                                
Income before the cumulative effect of changes in accounting principles
   
$
0.26
   
$
0.18
   
$
0.61
 
   
$
0.28
 
Cumulative effect of changes in accounting principles
   
 
—  
   
 
—  
   
 
(2.97
)
   
 
(0.07
)
    
  
  
  
Basic earnings (loss) per common share
   
$
0.26
   
$
0.18
   
$
(2.36
)
   
$
0.21
 
    
  
  
  
Average number of shares used in basic earnings per share computations
   
 
65.4
   
 
65.0
   
 
65.3
 
   
 
65.0
 
    
  
  
  
Diluted earnings (loss) per common share (Note 5):
                                
Income before the cumulative effect of changes in accounting principles
   
$
0.25
   
$
0.17
   
$
0.59
 
   
$
0.27
 
Cumulative effect of changes in accounting principles
   
 
—  
   
 
—  
   
 
(2.91
)
   
 
(0.07
)
    
  
  
  
Diluted earnings (loss) per common share
   
$
0.25
   
$
0.17
   
$
(2.32
)
   
$
0.20
 
    
  
  
  
Average number of shares used in diluted earnings per share computations
   
 
66.8
   
 
66.2
   
 
66.8
 
   
 
65.8
 
    
  
  
  
 
 
 
The accompanying notes are an integral part of the consolidated financial statements.

3

FMC Technologies, Inc. and Consolidated Subsidiaries
 
Consolidated Balance Sheets
(In millions, except per share data)
 
    
September 30, 2002
     
December 31,
2001
  
    
(Unaudited)
         
Assets:
                  
Current assets:
                  
Cash and cash equivalents
   
$
38.6
 
   
$
28.0
 
Trade receivables, net of allowances of $9.1 in 2002 and $9.2 in 2001
   
 
402.8
 
   
 
375.9
 
Inventories (Note 7)
   
 
296.8
 
   
 
269.6
 
Due from FMC Corporation, net
   
 
0.2
 
   
 
4.7
 
Other current assets
   
 
80.0
 
   
 
62.5
 
Deferred income taxes
   
 
4.1
 
   
 
14.4
 
    
  
Total current assets
   
 
822.5
 
   
 
755.1
 
Investments
   
 
27.7
 
   
 
27.1
 
Property, plant and equipment, net of accumulated depreciation
of $382.2 in 2002 and $349.5 in 2001
   
 
295.1
 
   
 
275.3
 
Goodwill (Note 4)
   
 
79.8
 
   
 
311.6
 
Intangible assets, net (Note 4)
   
 
34.8
 
   
 
35.5
 
Other assets
   
 
11.4
 
   
 
17.9
 
Deferred income taxes
   
 
34.4
 
   
 
15.4
 
    
  
Total assets
   
$
1,305.7
 
   
$
1,437.9
 
    
  
Liabilities and stockholders’ equity:
                  
Current liabilities:
                  
Short-term debt
   
$
83.5
 
   
$
78.8
 
Current portion of long-term debt
   
 
0.1
 
   
 
0.1
 
Accounts payable, trade and other
   
 
413.5
 
   
 
369.4
 
Other current liabilities
   
 
183.6
 
   
 
171.7
 
Current portion of accrued pension and other postretirement benefits
   
 
20.0
 
   
 
19.0
 
Income taxes payable
   
 
23.6
 
   
 
41.8
 
    
  
Total current liabilities
   
 
724.3
 
   
 
680.8
 
Long-term debt, less current portion
   
 
185.5
 
   
 
194.1
 
Accrued pension and other postretirement benefits, less current portion
   
 
35.2
 
   
 
48.7
 
Reserve for discontinued operations
   
 
18.9
 
   
 
23.4
 
Other liabilities
   
 
56.1
 
   
 
69.3
 
Minority interests in consolidated companies
   
 
4.8
 
   
 
3.4
 
Commitments and contingent liabilities (Note 8)
                  
Stockholders’ equity:
                  
Preferred stock, $0.01 par value, 12.0 shares authorized; no shares issued in 2002 or 2001
   
 
—  
 
   
 
—  
 
Common stock, $0.01 par value, 195.0 shares authorized; 65.5 and 65.1 shares issued in 2002 and 2001; 65.4 and 65.0 shares outstanding in 2002 and 2001
   
 
0.7
 
   
 
0.7
 
Common stock held in employee benefit trust, at cost, 0.1 shares in 2002 and 2001
   
 
(2.3
)
   
 
(1.2
)
Capital in excess of par value of common stock
   
 
527.0
 
   
 
523.0
 
Retained earnings (deficit)
   
 
(111.9
)
   
 
42.3
 
Accumulated other comprehensive loss (Note 9)
   
 
(132.6
)
   
 
(146.6
)
    
  
Total stockholders’ equity
   
 
280.9
 
   
 
418.2
 
    
  
Total liabilities and stockholders’ equity
   
$
1,305.7
 
   
$
1,437.9
 
    
  
 
The accompanying notes are an integral part of the consolidated financial statements.

4

FMC Technologies, Inc. and Consolidated Subsidiaries
 
Consolidated Statements of Cash Flows (Unaudited)
(In millions)
 
 
    
Nine Months Ended September 30
  
    
2002
     
2001
  
Cash provided (required) by operating activities of continuing operations:
                  
Income before the cumulative effect of changes in accounting principles
   
$
39.6
 
   
$
18.0
 
Adjustments to reconcile income before the cumulative effect of changes in accounting principles to cash provided (required) by operating activities of continuing operations:
                  
Depreciation
  
 
29.4
 
   
 
27.9
 
Amortization
   
 
6.1
 
   
 
15.0
 
Asset impairments (Note 2)
   
 
—  
 
   
 
1.3
 
Restructuring charges (Note 2)
   
 
—  
 
   
 
15.5
 
Amortization of employee benefit plan costs
   
 
7.9
 
   
 
5.5
 
Settlement of derivative contracts (Note 6)
   
 
—  
 
   
 
(3.8
)
Deferred income taxes
   
 
11.7
 
   
 
0.6
 
Other
   
 
2.4