CRANE CO /DE/ - FORM 8-K - EX-99.2 - CRANE CO. QUARTERLY FINANCIAL DATA SUPPLEMENT - July 23, 2012

Attached files

file filename
8-K - FORM 8-K - CRANE CO /DE/d383576d8k.htm
EX-99.1 - EARNINGS PRESS RELEASE - CRANE CO /DE/d383576dex991.htm

Exhibit 99.2

CRANE CO.

Income Statement Data

(in thousands, except per share data)

 

    Three Months Ended
June 30,		    

Six Months Ended

June 30,

  
    2012     2011     2012     2011  

Net Sales:

        

Aerospace & Electronics

   $ 178,591      $ 171,538      $ 353,759      $ 333,474   

Engineered Materials

     54,487        60,101        112,647        121,933   

Merchandising Systems

     97,577        94,010        185,252        188,888   

Fluid Handling

     302,318        286,141        600,537        546,811   

Controls

     24,713        21,399        51,104        42,372   
 

 

 

    

 

 

    

 

 

    

 

 

  

Total Net Sales

   $ 657,686      $ 633,189      $ 1,303,299      $ 1,233,478   
 

 

 

    

 

 

    

 

 

    

 

 

  

Operating Profit (Loss) from Continuing Operations:

        

Aerospace & Electronics

   $ 38,931      $ 37,157      $ 77,001      $ 71,199   

Engineered Materials

     5,543        9,130        13,952        19,273   

Merchandising Systems

     9,115        7,114        13,828        11,787   

Fluid Handling

     26,836        36,856        66,028        71,605   

Controls

     3,784        2,712        7,669        5,103   

Corporate

     (14,832 )      (14,118 )      (30,804 )      (28,680 ) 
 

 

 

    

 

 

    

 

 

    

 

 

  

Total Operating Profit from Continuing Operations

     69,377        78,851        147,674        150,287   

Interest Income

     454        389        849        679   

Interest Expense

     (6,785 )      (6,429 )      (13,496 )      (13,051 ) 

Miscellaneous - Net

     (351 )      (290 )      (698 )      3,335 * 
 

 

 

    

 

 

    

 

 

    

 

 

  

Income from Continuing Operations Before Income Taxes

     62,695        72,521        134,329        141,250   

Provision for Income Taxes

     19,857        22,694        40,518        43,971   
 

 

 

    

 

 

    

 

 

    

 

 

  

Income from Continuing Operations

     42,838        49,827        93,811        97,279   

Profit from Discontinued Operations attributable to common shareholders

     2,513        1,092        3,777        2,516   

Gain from Sales of Discontinued Operations attributable to common shareholders

     28,060        —          28,060        —     

Profit from Discontinued Operations attributable to common shareholders, net of tax

     1,633        710        2,456        1,636   

Gain from Sales of Discontinued Operations attributable to common shareholders, net of tax

     18,276        —          18,276        —     
 

 

 

    

 

 

    

 

 

    

 

 

  

Gain / Profit from Discontinued Operations, net of tax

     19,909        710        20,732        1,636   

Net income before allocation to noncontrolling interests

     62,747        50,537        114,543        98,915   

Less: Noncontrolling interest in subsidiaries’ earnings

     185        100        319        11   
 

 

 

    

 

 

    

 

 

    

 

 

  

Net income attributable to common shareholders

   $ 62,562      $ 50,437      $ 114,224      $ 98,904   
 

 

 

    

 

 

    

 

 

    

 

 

  

Share Data:

        

Earnings per share from Continuing Operations

   $ 0.73      $ 0.84      $ 1.59      $ 1.64   

Earnings per share from Discontinued Operations

     0.34        0.01        0.35        0.03   
 

 

 

    

 

 

    

 

 

    

 

 

  

Earnings per Diluted Share (a)

   $ 1.07      $ 0.85      $ 1.95      $ 1.66   
 

 

 

    

 

 

    

 

 

    

 

 

  

Average Diluted Shares Outstanding

     58,614        59,348        58,704        59,457   

Average Basic Shares Outstanding

     57,762        58,173        57,787        58,259   
Supplemental Data:        

Cost of Sales

   $ 436,095      $ 415,985      $ 865,717      $ 806,764   

Selling, General & Administrative

     137,467        138,353        275,161        276,427   

Repositioning Charges

     14,747        —          14,747        —     

Depreciation and Amortization **

     15,274        15,853        29,948        31,627   

Stock-Based Compensation Expense

     4,451        3,771        8,458        7,274   

 

* Primarily related to the sale of a building and the divestiture of a small product line in the three months ended March 31, 2011.
** Amount included within cost of sales and selling, general & administrative costs.
(a) Earnings per share amounts may not add due to rounding

CRANE CO.

Condensed Balance Sheets

(in thousands)

 

     June 30,
2012		      December 31,
2011		  

ASSETS

      

Current Assets

      

Cash and Cash Equivalents

    $ 252,299       $ 245,089   

Accounts Receivable, net

      416,116         349,250   

Current Insurance Receivable - Asbestos

      16,345         16,345   

Inventories, net

      363,933         360,689   

Other Current Assets

      65,358         60,859   
  

 

 

     

 

 

  

Total Current Assets

      1,114,051         1,032,232   

Property, Plant and Equipment, net

      273,640         284,146   

Long-Term Insurance Receivable - Asbestos

      202,107         208,952   

Other Assets

      465,560         497,377   

Goodwill

      806,170         820,824   
  

 

 

     

 

 

  

Total Assets

    $ 2,861,528       $ 2,843,531   
  

 

 

     

 

 

  

LIABILITIES AND EQUITY

      

Current Liabilities

      

Notes Payable and Current Maturities of Long-Term Debt

    $ 1,102       $ 1,112   

Accounts Payable

      180,809         194,158   

Current Asbestos Liability

      100,943         100,943   

Accrued Liabilities

      209,680         226,717   

Income Taxes

      27,407         10,165   
  

 

 

     

 

 

  

Total Current Liabilities

      519,941         533,095   

Long-Term Debt

      399,003         398,914   

Long-Term Deferred Tax Liability

      41,546         41,668   

Long-Term Asbestos Liability

      746,640         792,701   

Other Liabilities

      249,895         255,097   

Total Equity

      904,503         822,056   
  

 

 

     

 

 

  

Total Liabilities and Equity

    $ 2,861,528       $ 2,843,531   
  

 

 

     

 

 

  

CRANE CO.

Condensed Statements of Cash Flows

(in thousands)

 

     Three Months Ended
June 30,		     Six Months Ended
June 30,		  
     2012     2011     2012     2011  

Operating Activities:

         

Net income attributable to common shareholders

    $ 62,562      $ 50,437      $ 114,224      $ 98,904   

Noncontrolling interest in subsidiaries’ earnings

      185        100        319        11   
  

 

 

    

 

 

    

 

 

    

 

 

  

Net income before allocations to noncontrolling interests

      62,747        50,537        114,543        98,915   

Gain on divestiture

      (28,060 )      —          (28,060 )      (4,258 ) 

Restructuring - Non Cash

      2,761          2,761     

Depreciation and amortization

      15,274        15,853        29,948        31,627   

Stock-based compensation expense

      4,451        3,771        8,458        7,274   

Defined benefit plans and postretirement expense

      4,982        843        9,973        3,592   

Deferred income taxes

      7,199        6,627        15,743        13,520   

Cash provided by (used for) operating working capital

      12,889        (18,141 )      (90,614 )      (85,391 ) 

Defined benefit plans and postretirement contributions

      (1,638 )      (5,579 )      (2,821 )      (10,358 ) 

Environmental payments, net of reimbursements

      (4,724 )      (1,541 )      (7,303 )      (6,134 ) 

Other

      4,010        1,895        2,691        2,037   
  

 

 

    

 

 

    

 

 

    

 

 

  

Subtotal

      79,891        54,265        55,319        50,824   

Asbestos related payments, net of insurance recoveries

      (20,982 )      (22,896 )      (39,217 )      (35,621 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total provided by operating activities

      58,909        31,369        16,102        15,203   
  

 

 

    

 

 

    

 

 

    

 

 

  

Investing Activities:

         

Capital expenditures

      (6,615 )      (10,144 )      (13,780 )      (18,282 ) 

Proceeds from disposition of capital assets

      1,686        (23 )      1,858        4,530   

Payment for acquisition, net of cash acquired

      —          —          —          —     

Proceeds from divestiture

      52,665        —          52,665        1,000   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total used for investing activities

      47,736        (10,167 )      40,743        (12,752 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Financing Activities:

         

Dividends paid

      (14,985 )      (13,385 )      (30,075 )      (26,859 ) 

Reacquisition of shares on open market

      (29,991 )      (20,000 )      (29,991 )      (49,999 ) 

Stock options exercised - net of shares reacquired

      —          4,472        8,426        17,024   

Excess tax benefit from stock-based compensation

      331        1,407        3,278        5,359   

Change in short-term debt

      318        (454 )      —          (530 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total used for financing activities

      (44,327 )      (27,960 )      (48,362 )      (55,005 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Effect of exchange rate on cash and cash equivalents

      (5,879 )      4,961        (1,273 )      10,978   
  

 

 

    

 

 

    

 

 

    

 

 

  

Increase (decrease) in cash and cash equivalents

      56,439        (1,797 )      7,210        (41,576 ) 

Cash and cash equivalents at beginning of period

      195,860        233,162        245,089        272,941   
  

 

 

    

 

 

    

 

 

    

 

 

  

Cash and cash equivalents at end of period

    $ 252,299      $ 231,365      $ 252,299      $ 231,365   
  

 

 

    

 

 

    

 

 

    

 

 

  

CRANE CO.

Order Backlog

(in thousands)

 

     June 30,
2012		     March 31,
2012		     December 31,
2011		     September 30,
2011		     June 30,
2011		  

Aerospace & Electronics

    $ 423,282      $ 437,822      $ 410,794      $ 409,284      $ 431,799   

Engineered Materials

      13,884        11,129        11,110        9,879        13,087   

Merchandising Systems

      23,587        30,033        15,212        20,929        26,898   

Fluid Handling

      334,696 *      337,538 *      313,715 *      328,757 *      323,045   

Controls

      16,187        29,770 **      27,120 **      32,145 **      30,323 ** 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Backlog

    $ 811,636      $ 846,292      $ 777,951      $ 800,994      $ 825,152   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

* Includes Order Backlog of $6.3 million at June 30, 2012, $7.5 million at March 31, 2012, $7.1 million at December 31, 2011 and $5.4 million at September 30, 2011 pertaining to the 2011 acquisition of WTA and $2.9 million at March 31, 2012, $1.9 million at December 31, 2011, September 30, 2011 and June 30, 2011 pertaining to a business divested in June 2012
** Includes Order Backlog of $11.3 million at March 31, 2012, $9.6 million at December 31, 2011, $11.8 million at September 30, 2011 and $12.4 million at June 30, 2011 pertaining to a business divested in June 2012.

CRANE CO.

Non-GAAP Financial Measures

(in thousands)

 

     Three Months Ended
June 30,		     Six Months Ended
June 30,		     Percent Change
June 30, 2012		     Percent Change
June 30, 2012		  
     2012     2011     2012     2011     Three Months     Six Months  
INCOME ITEMS             

Net Sales

    $ 657,686      $ 633,189      $ 1,303,299      $ 1,233,478        3.9 %      5.7 % 

Operating Profit from Continuing Operations

      69,377        78,851        147,674        150,287        -12.0 %      -1.7 % 

Percentage of Sales

      10.5 %      12.5 %      11.3 %      12.2 %     

Special Items impacting Operating Profit from Continuing Operations:

             

Repositioning Charges (a)

      14,747          14,747         
  

 

 

    

 

 

    

 

 

    

 

 

      

Operating Profit from Continuing Operations before Special Items

    $ 84,124      $ 78,851      $ 162,422      $ 150,287        6.7 %      8.1 % 
  

 

 

    

 

 

    

 

 

    

 

 

      

Percentage of Sales

      12.8 %      12.5 %      12.5 %      12.2 %     

Net Income Attributable to Common Shareholders

    $ 62,562      $ 50,437      $ 114,224      $ 98,904       

Per Share

    $ 1.07      $ 0.85      $ 1.95      $ 1.66        25.6 %      17.0 % 

Special Items impacting Net Income Attributable to Common Shareholders:

             

Repositioning Charges - Net of Tax (a)

      11,880          11,880         

Per Share

    $ 0.20        $ 0.20         

Gain on Divestitures - Net of Tax (b)

      (18,276 )        (18,276 )       

Per Share

    $ (0.31 )      $ (0.31 )       
  

 

 

    

 

 

    

 

 

    

 

 

      

Net Income Attributable To Common Shareholders Before Special Items

    $ 56,166      $ 50,437      $ 107,828      $ 98,904        11.4 %      9.0 % 
  

 

 

    

 

 

    

 

 

    

 

 

      

Per Basic Share

    $ 0.97      $ 0.87      $ 1.87      $ 1.70       

Per Diluted Share

    $ 0.96      $ 0.85      $ 1.84      $ 1.66        12.8 %      10.4 % 

 

(a) The Company incurred repositioning charges in the second quarter of 2012, associated with productivity actions. The charges included severance and impairment costs related to the shutdown of certain facilities, the transfer of certain manufacturing operations, and staff reduction actions.
(b) In June 2012, the Company divested of a business within the Fluid Handling segment and a business within the Controls segment. The associated gains were included in the “Gain from Sale of Discontinued Operations attributable to common shareholders, net of tax” section on the accompanying Income Statement Data.

 

     Three Months Ended
June 30,		     Six Months Ended
June 30,		  
     2012     2011     2012     2011  
CASH FLOW ITEMS         

Cash Provided from Operating Activities before Asbestos - Related Payments

    $ 79,891      $ 54,265      $ 55,319      $ 50,824   

Asbestos Related Payments, Net of Insurance Recoveries

      (20,982 )      (22,896 )      (39,217 )      (35,621 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Cash Provided from Operating Activities

      58,909        31,369        16,102        15,203   

Less: Capital Expenditures

      (6,615 )      (10,144 )      (13,780 )      (18,282 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Free Cash Flow

    $ 52,294      $ 21,225      $ 2,322      $ (3,079 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Certain non-GAAP measures have been provided to facilitate comparison with the prior year.

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that non-GAAP financial measures which exclude certain non-recurring items present additional useful comparisons between current results and results in prior operating periods, providing investors with a clearer view of the underlying trends of the business. Management also uses these non-GAAP financial measures in making financial, operating, planning and compensation decisions and in evaluating the Company’s performance.

In addition, Free Cash Flow provides supplemental information to assist management and investors in analyzing the Company’s ability to generate liquidity from its operating activities. The measure of Free Cash Flow does not take into consideration certain other non-discretionary cash requirements such as, for example, mandatory principal payments on the Company’s long-term debt. Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.

Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in the context of the definitions of the elements of such measures we provide and in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.

CRANE CO /DE/ Reports