Delaware
(State of Incorporation)
|
53-0257888
(I.R.S. Employer
Identification No.)
|
Title of Each Class | Name of Each Exchange on Which Registered | |
Common Stock, par value $1 | New York Stock Exchange |
Large accelerated filer
þ
|
Accelerated filer
o
|
Non-accelerated filer
o
|
Smaller reporting company
o
|
|
||||||
Years Ended December 31,
|
|||||
2011
|
2010
|
2009
|
|||
Communication Technologies
|
17%
|
16%
|
17%
|
||
Energy
|
24%
|
20%
|
19%
|
||
Engineered Systems
|
39%
|
42%
|
43%
|
||
Printing and Identification
|
20%
|
22%
|
21%
|
·
|
Communications –
Our businesses serving the communications market design, manufacture and assemble micro-acoustic audio input and output components for use principally in personal mobile handsets.
|
·
|
Life sciences –
Our businesses serving the life sciences market manufacture advanced miniaturized receivers and electromechanical components for use in hearing aids, connectors for use in a variety of medical devices and bio processing applications, and specialized components for use in implantable devices and medical equipment.
|
·
|
Aerospace/Industrial –
Our businesses serving the aerospace/industrial markets manufacture precision engineered components and aftermarket parts across a broad array of market applications. In the commercial aerospace market, our businesses design and manufacture specialty hydraulics, fasteners, bearings, switches and filters sold to both OEMs and as aftermarket products. Our companies also design and manufacture frequency control components, electromechanical switches, multi-layered capacitors, filters and quick disconnect couplings serving the general industrial markets.
|
·
|
Defense
– Our businesses serving the defense market manufacture specialty hydraulics, mechanical and frequency control communication components, serving shipboard applications, strategic mission critical parts on key Airborne programs and Command and Control communications. These businesses also support key space initiatives with critical communication components.
|
·
|
Telecommunication/Other
– Our businesses serving the telecommunication/other markets manufacture frequency control components for wired and wireless network base station communications that ensure precise signal timing and filters for non-interrupted access across high speed networks. Our businesses also serve the consumer electronic market with various audio components.
|
·
|
Drilling
– Our businesses serving the drilling market design and manufacture products that promote efficient and cost-effective drilling, including long-lasting polycrystalline diamond cutters (PDCs) for applications in down-hole drilling tools and quartz pressure transducers and hybrid electronics used in down-hole tools and monitoring devices.
|
·
|
Production
–
Our businesses serving the production market design and manufacture products and components that facilitate the extraction and movement of fuel from the ground, including steel sucker rods, down-hole rod pumps, progressive cavity pumps and drive systems, plunger lifts, and accessories used in artificial lift applications in oil and gas production; pressure, temperature and flow monitoring equipment used in oil and gas exploration and production applications; and control valves and instrumentation for oil and gas production. In addition, these businesses manufacture various compressor parts that are being used in the natural gas production, distribution and oil refining markets; and winches, hoists, gear drives, swing drives, auger drives, slewing ring bearings, hydraulic pump and electronic monitoring solutions for energy, infrastructure and recovery markets worldwide.
|
·
|
Downstream
–
Our businesses serving the downstream market produce systems and products that support efficient, safe, and environmentally-sensitive transportation and handling of fuel, hazardous liquids and dry-bulk commodities. Vehicle fuel dispensing products include conventional, vapor recovery, and clean energy (LPG, CNG, and Hydrogen) nozzles, swivels and breakaways, as well as tank pressure management systems. Products manufactured for the transportation, storage and processing of hazardous liquid and dry-bulk commodities include relief valves, loading/unloading angle valves, rupture disc devices, actuator systems, level measurement gauges, swivel joints, butterfly valves, lined ball valves, aeration systems, industrial access ports, manholes, hatches, collars, weld rings and fill covers. In addition, we offer bearings, bearing isolators, seals and remote condition monitoring systems that are used for rotating machinery applications such as turbo machinery, motors, generators and compressors used in energy, utility, marine and other industries.
|
·
|
Refrigeration & food equipment –
Our businesses manufacture refrigeration systems, refrigeration display cases, walk-in coolers and freezers, electrical distribution products and engineering services, commercial foodservice equipment, cook-chill production systems, custom food storage and preparation products, kitchen ventilation systems, conveyer systems, beverage can-making machinery, and packaging machines used for meat, poultry and other food products. The platform’s refrigeration/food related manufacturing facilities and distributing operations are principally in North America, Europe and Asia.
|
·
|
Waste and recycling –
The business in the solid waste management market provides products and services for the refuse collection industry and for on-site processing and compaction of trash and recyclable materials. Products are sold to municipal customers, national accounts and independent waste haulers through a network of distributors and directly in certain geographic areas. The on-site waste management and recycling systems include a variety of stationary compactors, wire processing and separation machines, and balers that are manufactured and sold primarily in the United States to distribution centers, malls, stadiums, arenas, office complexes, retail stores and recycling centers.
|
·
|
Other industrial –
We also serve the vehicle service and industrial automation markets, providing a wide range of products and services that are utilized in vehicle services, maintenance, washing, repair and modification. Vehicle lifts and collision equipment are sold through equipment distributors and directly to a wide variety of markets, including independent service and repair shops, collision repair shops, national chains and franchised service facilities, new vehicle dealers, governments, and directly to consumers via the Internet. The businesses also produce 4WD and AWD powertrain systems and accessories for off-road vehicles, which are sold to OEMs and extensive dealer networks primarily in North America. These other industrial manufacturing operations are located primarily in North and South America, Asia and Europe.
|
·
|
Fast Moving Consumer Goods (FMCG)
– Our businesses serving this market primarily design and manufacture marking & coding products used for printing variable information (such as date codes and serial numbers) on food, beverage, consumer goods, and pharmaceutical products, capitalizing on expanding food and product safety requirements and growth in emerging markets.
|
·
|
Industrial
– Our products used by the industrial market are primarily marking & coding, bar code & portable printers, and fluid dispensing related products serving a number of industrial end markets including aerospace, cable, military, material packaging, industrial assembly, and medical devices capitalizing on growing industrial-related manufacturing in emerging markets. Additional products include broad line marking solutions leveraged for secondary packaging, such as cartons and pallets for use in warehouse logistics operations, and bar code printers and portable printers used where on demand labels/receipts are required.
|
·
|
Electronics –
Our businesses serving the electronics market primarily design and manufacture high-speed precision material deposition machines and other related tools used in the assembly process for printed circuit boards, solar cells and other specialty electronic applications as well as precision manual soldering, de-soldering and other hand tools. The test equipment products include machines, test fixtures and related products used in testing “bare” and “loaded” electronic circuit boards and semiconductors.
|
% Non-US Revenue by Segment
|
|||||
Years Ended December 31,
|
|||||
2011
|
2010
|
2009
|
|||
Communication Technologies
|
71%
|
63%
|
60%
|
||
Energy
|
32%
|
33%
|
33%
|
||
Engineered Systems
|
36%
|
34%
|
33%
|
||
Printing and Identification
|
76%
|
78%
|
74%
|
||
Total percentage of revenue derived from
|
|||||
customers outside of the United States
|
49%
|
48%
|
46%
|
·
|
Our results for 2012 may be impacted by current domestic and international economic conditions and uncertainties.
|
·
|
Increasing product/service and price competition by international and domestic competitors, including new entrants and our ability to introduce new and competitive products could cause our businesses to generate lower revenue, operating profits and cash flows.
|
·
|
Some of our businesses may not anticipate, adapt to, or capitalize on technological developments and are subject to the cyclical nature of their industries. These factors could cause these businesses to become less competitive and lead to reduced market share, revenue, operating profits and cash flows.
|
·
|
We could lose customers or generate lower revenue, operating profits and cash flows if there are significant increases in the cost of raw materials (including energy) or if we are unable to obtain raw materials.
|
·
|
We are subject to risks relating to our existing foreign operations and expansion into new geographical markets.
|
o
|
political, social and economic instability and disruptions;
|
o
|
government embargoes or trade restrictions;
|
o
|
the imposition of duties and tariffs and other trade barriers;
|
o
|
import and export controls;
|
o
|
limitations on ownership and on repatriation of earnings;
|
o
|
transportation delays and interruptions;
|
o
|
labor unrest and current and changing regulatory environments;
|
o
|
increased compliance costs including requirements for disclosure and due diligence;
|
o
|
the impact of loss of a single-source manufacturing facility;
|
o
|
difficulties in staffing and managing multi-national operations; and
|
o
|
limitations on our ability to enforce legal rights and remedies.
|
·
|
Our exposure to exchange rate fluctuations on cross-border transactions and the translation of local currency results into U.S. dollars could negatively impact our results of operations.
|
·
|
Our operating profits and cash flows could be adversely affected if we cannot achieve projected savings and synergies.
|
·
|
Failure to attract, retain and develop personnel or to provide adequate succession plans for key management could have an adverse effect on our operating results.
|
·
|
Our businesses and their profitability and reputation could be adversely affected by domestic and foreign governmental and public policy changes (including environmental and employment regulations and tax policies such as export subsidy programs, research and experimentation credits, carbon emission regulations, and other similar programs), risks associated with emerging markets, changes in statutory tax rates and unanticipated outcomes with respect to tax audits.
|
·
|
Customer requirements and new regulations may increase our expenses and impact the availability of certain raw materials, which could adversely affect our revenue and operating profits.
|
·
|
Unforeseen developments in contingencies such as litigation could adversely affect our financial condition.
|
·
|
The indemnification provisions of acquisition agreements by which we have acquired companies may not fully protect us and may result in unexpected liabilities.
|
·
|
Our revenue, operating profits and cash flows could be adversely affected if our businesses are unable to protect or obtain patent and other intellectual property rights.
|
·
|
Our growth and results of operations may be adversely affected if we are unsuccessful in our capital allocation and acquisition program.
|
·
|
Our borrowing costs may be impacted by our credit ratings developed by various rating agencies.
|
·
|
Our reputation, ability to do business and results of operations may be impaired by improper conduct by any of our employees, agents or business partners.
|
Number and Nature of Facilities
|
Square Footage (000's)
|
||||||||
Segment
|
Mfg.
|
Warehouse
|
Sales/ Service
|
Owned
|
Leased
|
||||
Communication Technologies
|
33
|
3
|
13
|
1,129
|
1,296
|
||||
Energy
|
60
|
46
|
28
|
3,037
|
1,016
|
||||
Engineered Systems
|
69
|
33
|
32
|
5,374
|
2,584
|
||||
Printing and Identification
|
32
|
25
|
84
|
895
|
1,248
|
Locations
|
Leased Facilities
|
||||||||||
North
|
Expiration Dates (Years)
|
||||||||||
America
|
Europe
|
Asia
|
Other
|
Minimum
|
Maximum
|
||||||
Communication Technologies
|
19
|
8
|
9
|
1
|
1
|
15
|
|||||
Energy
|
103
|
5
|
2
|
6
|
1
|
15
|
|||||
Engineered Systems
|
66
|
34
|
19
|
2
|
1
|
10
|
|||||
Printing and Identification
|
32
|
39
|
48
|
4
|
1
|
10
|
Name
|
Age
|
Positions Held and Prior Business Experience
|
|||
Robert A. Livingston
|
58
|
Chief Executive Officer and Director (since December 2008), President (since June 2008) and Chief Operating Officer (from June 2008 to December 2008) of Dover; prior thereto Vice President of Dover and President and Chief Executive Officer of Dover Engineered Systems (from July 2007 to May 2008); prior thereto Vice President of Dover and President and Chief Executive Officer of Dover Electronics (from October 2004 to June 2007).
|
|||
Kevin P. Buchanan
|
56
|
Vice President, Tax (since July 2010) of Dover; prior thereto Deputy General Counsel, Tax (from November 2009 to June 2010) and Vice President, Tax (from May 2000 to October 2009) of Monsanto Company.
|
|||
Brad M. Cerepak
|
53
|
Senior Vice President and Chief Financial Officer (since May 2011) of Dover; prior thereto Vice President and Chief Financial Officer (from August 2009 to May 2011) of Dover; prior thereto Vice President, Finance (from June 2009 to August 2009) of Dover; prior thereto Vice President and Controller (from August 2005 to June 2008) of Trane.
|
|||
C. Anderson Fincher
|
41
|
Vice President (since May 2011) of Dover and Executive Vice President (since November 2011) of Dover Engineered Systems; prior thereto Executive Vice President (from May 2009 to November 2011) of Dover Industrial Products; prior thereto President (from January 2005 to May 2009) of Heil Trailer International.
|
|||
Thomas W. Giacomini
|
46
|
Vice President (since February 2008) of Dover and President and Chief Executive Officer (since November 2011) of Dover Engineered Systems; prior thereto President (from April 2009 to November 2011) and Chief Executive Officer (from July 2009 to November 2011) of Dover Industrial Products; prior thereto President (from October 2007 to July 2009) of Dover's Material Handling Platform; prior thereto President (from July 2005 to September 2007) of Warn Industries; prior thereto Chief Operating Officer (from 2000 to July 2005) of Warn Industries.
|
|||
Paul E. Goldberg
|
48
|
Vice President, Investor Relations (since November 2011) of Dover; prior thereto Treasurer and Director of Investor Relations (from February 2006 to November 2011) of Dover; prior thereto Assistant Treasurer (from July 2002 to February 2006) of Dover.
|
|||
John F. Hartner
|
49
|
Vice President (since May 2011) of Dover and President and Chief Executive Officer (since November 2011) of Dover Printing & Identification; prior thereto Executive Vice President (from April 20l1 to November 2011) of Dover Engineered Systems; prior thereto Executive Vice President (from October 2007 to April 2011) of Dover Electronic Technologies; prior thereto President (from April 2001 to October 2007) of DEK International.
|
|||
Jay L. Kloosterboer
|
51
|
Senior Vice President, Human Resources (since May 2011) of Dover; prior thereto Vice President, Human Resources (from January 2009 to May 2011) of Dover; prior thereto Executive Vice President - Business Excellence (from May 2005 to January 2009) of AES Corporation; prior thereto Vice President and Chief Human Resources Officer (from May 2003) of AES Corporation.
|
|||
Raymond T. McKay, Jr.
|
58
|
Vice President (since February 2004) and Controller (since November 2002) of Dover.
|
|||
Brian P. Moore
|
41
|
Vice President, Treasurer (since November 2011) of Dover; prior thereto Senior Director, Investor Relations (from April 2010 to October 2011) of USG Corporation ; prior thereto Director of Credit & Accounts Receivable (from December 2008 to April 2010) of USG; prior thereto Director of Finance (from December 2007 to December 2008) at USG; prior thereto Assistant Treasurer (from October 2004 to December 2008) of USG.
|
Name
|
Age
|
Positions Held and Prior Business Experience
|
|||
James H. Moyle
|
59
|
Vice President (since 2009) of Dover and Executive Vice President (since January 2012) of Dover Engineered Systems; prior thereto Vice President, Global Sourcing and Supply Chain (from April 2009 to December 2011) of Dover; prior thereto Chief Financial Officer (from July 2007 to April 2009) of Dover Fluid Management; prior thereto Vice President and Chief Financial Officer (from November 2005 to July 2007) of Dover Diversified; prior thereto Executive Vice President (from September 2003 to November 2005) of Knowles Electronics.
|
|||
Jeffrey S. Niew
|
45
|
Vice President of Dover and President and Chief Executive Officer of Dover Communication Technologies (since November 2011); prior thereto President (from January 2008 to November 2011) and Chief Executive Officer (from February 2010 to November 2011) of Knowles Electronics; prior thereto Chief Operating Officer (from January 2007 to February 2010) of Knowles Electronics; prior thereto Vice President and General Manager (from September 2002 to January 2007) of Knowles Acoustics.
|
|||
Joseph W. Schmidt
|
65
|
Senior Vice President, General Counsel and Secretary (since May 2011) of Dover; prior thereto Vice President, General Counsel and Secretary (from January 2003 to May 2011) of Dover.
|
|||
Stephen R. Sellhausen
|
54
|
Senior Vice President, Corporate Development (since May 2011) of Dover; prior thereto Vice President, Corporate Development (from January 2009 to May 2011) of Dover; prior thereto Vice President, Business Development (from April 2008 to January 2009) of Dover; prior thereto investment banker with Citigroup Global Markets.
|
|||
Sivasankaran Somasundaram
|
46
|
Vice President (since January 2008) of Dover and Executive Vice President (since November 2011) of Dover Energy; prior thereto Executive Vice President (from January 2010 to November 2011) of Dover Fluid Management; President (from January 2008 to December 2009) of Dover's Fluid Solutions Platform; prior thereto President (from May 2006 to January 2008) of Gas Equipment Group; prior thereto President (from March 2004 to May 2006) of RPA Process Technologies.
|
|||
William W. Spurgeon, Jr.
|
53
|
Vice President (since October 2004) of Dover and President and Chief Executive Officer (since November 2011) of Dover Energy; prior thereto President and Chief Executive Officer (from July 2007 to November 2011) of Dover Fluid Management; prior thereto President and Chief Executive Officer (from October 2004 to July 2007) of Dover Diversified.
|
|||
Niclas Ytterdahl
|
47
|
Senior Vice President, Global Sourcing (since January 2012) of Dover; prior thereto Vice President, Global Strategic Sourcing (from April 2006 to December 2011) of AES Corporation; prior thereto Vice President Operations and General Manager (from January 2002 to April 2006) of Fisher Scientific.
|
|||
Michael Y. Zhang
|
48
|
Vice President (since May 2010) of Dover and President, Asia (since May 2011) of Dover; prior thereto Managing Director (from January 2009 to May 2011) of Dover Regional Headquarters, China; prior thereto various roles at ABB, Ltd., including Vice President, ABB Control System and Product Business (from September 2004 to March 2008).
|
2011
|
2010
|
||||||||||
Market Prices
|
Dividends Per Share
|
Market Prices
|
Dividends Per Share
|
||||||||
High
|
Low
|
High
|
Low
|
||||||||
First Quarter
|
$68.07
|
$56.51
|
$0.275
|
$47.56
|
$40.50
|
$0.26
|
|||||
Second Quarter
|
69.25
|
60.57
|
0.275
|
55.50
|
41.42
|
0.26
|
|||||
Third Quarter
|
70.15
|
45.42
|
0.315
|
53.00
|
40.50
|
0.275
|
|||||
Fourth Quarter
|
59.27
|
43.64
|
0.315
|
59.20
|
51.39
|
0.275
|
|||||
$1.18
|
$1.07
|
(1)
|
In October, we acquired 458 of these shares from the holders of our employee stock options when they tendered these shares as full or partial payment of the exercise price of such options. These shares are applied against the exercise price at the market price on the date of exercise. During October, November, and December, we purchased 490,000, 630,000, and 915,000 shares, respectively, under the five-year, 10,000,000 share repurchase authorized by the Board of Directors in May 2007, leaving 2,533,495 shares available for purchase as of the end of December 2011.
|
2011
|
2010
|
2009
|
2008
|
2007
|
||||||||||||||||
(In thousands except per share figures)
|
||||||||||||||||||||
Revenue
|
$ | 7,950,140 | $ | 6,640,191 | $ | 5,344,331 | $ | 6,808,313 | $ | 6,507,185 | ||||||||||
Earnings from continuing operations
|
846,365 | 690,751 | 373,423 | 649,892 | 608,987 | |||||||||||||||
Basic earnings (loss) per share:
|
||||||||||||||||||||
Continuing operations
|
$ | 4.55 | $ | 3.70 | $ | 2.01 | $ | 3.45 | $ | 3.02 | ||||||||||
Discontinued operations
|
0.26 | 0.05 | (0.09 | ) | (0.31 | ) | 0.26 | |||||||||||||
Net earnings
|
4.82 | 3.75 | 1.91 | 3.13 | 3.28 | |||||||||||||||
Weighted average shares outstanding
|
185,882 | 186,897 | 186,136 | 188,481 | 201,330 | |||||||||||||||
Diluted earnings (loss) per share:
|
||||||||||||||||||||
Continuing operations
|
$ | 4.48 | $ | 3.65 | $ | 2.00 | $ | 3.43 | $ | 3.00 | ||||||||||
Discontinued operations
|
0.26 | 0.05 | (0.09 | ) | (0.31 | ) | 0.26 | |||||||||||||
Net earnings
|
4.74 | 3.70 | 1.91 | 3.12 | 3.26 | |||||||||||||||
Weighted average shares outstanding
|
188,887 | 189,170 | 186,736 | 189,269 | 202,918 | |||||||||||||||
Dividends per common share
|
$ | 1.18 | $ | 1.07 | $ | 1.02 | $ | 0.90 | $ | 0.77 | ||||||||||
Capital expenditures
|
$ | 271,809 | $ | 174,845 | $ | 112,972 | $ | 167,998 | $ | 161,673 | ||||||||||
Depreciation and amortization
|
303,143 | 241,969 | 231,363 | 235,081 | 214,918 | |||||||||||||||
Total assets
|
9,501,450 | 8,558,743 | 7,882,402 | 7,883,238 | 8,068,407 | |||||||||||||||
Total debt
|
2,187,252 | 1,807,476 | 1,860,884 | 2,084,173 | 2,087,652 |
Years Ended December 31,
|
% / Point Change
|
|||||||||||||||||||
2011
|
2010
|
2009
|
2011 versus 2010
|
2010 versus 2009
|
||||||||||||||||
(Dollars in thousands except per share figures)
|
||||||||||||||||||||
Revenue
|
$ | 7,950,140 | $ | 6,640,191 | $ | 5,344,331 | 20 | % | 24 | % | ||||||||||
Cost of goods and services
|
4,898,716 | 4,023,586 | 3,331,187 | 22 | % | 21 | % | |||||||||||||
Gross profit
|
3,051,424 | 2,616,605 | 2,013,144 | 17 | % | 30 | % | |||||||||||||
Selling and administrative expenses
|
1,840,609 | 1,607,327 | 1,422,015 | 15 | % | 13 | % | |||||||||||||
Restructuring - severance and exit costs
|
5,695 | 6,160 | 67,322 | -8 | % | -91 | % | |||||||||||||
Interest expense, net
|
115,596 | 106,422 | 100,472 | 9 | % | 6 | % | |||||||||||||
Other expense (income), net
|
55 | 3,652 | (3,752 | ) | - | - | ||||||||||||||
Earnings from continuing operations
|
846,365 | 690,751 | 373,423 | 23 | % | 85 | % | |||||||||||||
Net earnings
|
895,243 | 700,104 | 356,438 | 28 | % | 96 | % | |||||||||||||
Net earnings per common share - diluted
|
$ | 4.74 | $ | 3.70 | $ | 1.91 | 28 | % | 94 | % | ||||||||||
Gross profit margin
|
38.4 | % | 39.4 | % | 37.7 | % | (1.0 | ) | 1.7 | |||||||||||
Selling and administrative expenses as a percentage of revenue
|
23.2 | % | 24.2 | % | 26.6 | % | (1.0 | ) | (2.4 | ) | ||||||||||
Effective tax rate
|
22.7 | % | 23.2 | % | 24.5 | % | (0.5 | ) | (1.3 | ) |
Years Ended December 31,
|
% Change
|
|||||||||||||||||||
2011
|
2010
|
2009
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Revenue
|
$ | 1,360,077 | $ | 1,076,012 | $ | 916,031 | 26.4 | % | 17.5 | % | ||||||||||
Segment earnings
|
$ | 226,382 | $ | 205,215 | $ | 142,541 | 10.3 | % | 44.0 | % | ||||||||||
Operating margin
|
16.6 | % | 19.1 | % | 15.6 | % | ||||||||||||||
Other measures:
|
||||||||||||||||||||
Depreciation and amortization
|
$ | 101,839 | $ | 72,262 | $ | 69,393 | 40.9 | % | 4.1 | % | ||||||||||
Bookings
|
1,344,540 | 1,128,265 | 952,346 | 19.2 | % | 18.5 | % | |||||||||||||
Backlog
|
437,320 | 404,374 | 337,833 | 8.1 | % | 19.7 | % | |||||||||||||
Components of revenue growth:
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||||
Organic growth
|
7.2 | % | 17.0 | % | ||||||||||||||||
Acquisitions
|
18.0 | % | 0.6 | % | ||||||||||||||||
Foreign currency translation
|
1.2 | % | -0.1 | % | ||||||||||||||||
26.4 | % | 17.5 | % |
Years Ended December 31,
|
% Change
|
|||||||||||||||||||
2011
|
2010
|
2009
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Revenue
|
$ | 1,900,749 | $ | 1,303,507 | $ | 998,272 | 45.8 | % | 30.6 | % | ||||||||||
Segment earnings
|
$ | 450,637 | $ | 316,113 | $ | 211,962 | 42.6 | % | 49.1 | % | ||||||||||
Operating margin
|
23.7 | % | 24.3 | % | 21.2 | % | ||||||||||||||
Other measures:
|
||||||||||||||||||||
Segment depreciation and amortization
|
$ | 77,819 | $ | 48,842 | $ | 40,349 | 59.3 | % | 21.0 | % | ||||||||||
Bookings
|
1,985,405 | 1,319,015 | 974,886 | 50.5 | % | 35.3 | % | |||||||||||||
Backlog
|
246,351 | 152,183 | 123,367 | 61.9 | % | 23.4 | % | |||||||||||||
Components of revenue growth:
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||||
Organic growth
|
26.2 | % | 24.7 | % | ||||||||||||||||
Acquisitions
|
18.5 | % | 4.7 | % | ||||||||||||||||
Foreign currency translation
|
1.1 | % | 1.2 | % | ||||||||||||||||
45.8 | % | 30.6 | % |
Years Ended December 31,
|
% Change
|
|||||||||||||||||||
2011
|
2010
|
2009
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Revenue
|
||||||||||||||||||||
Refrigeration & Industrial
|
$ | 2,424,638 | $ | 2,219,844 | $ | 1,807,283 | 9.2 | % | 22.8 | % | ||||||||||
Fluid Solutions
|
677,621 | 567,914 | 492,191 | 19.3 | % | 15.4 | % | |||||||||||||
Eliminations
|
(1,524 | ) | (1,316 | ) | (893 | ) | ||||||||||||||
$ | 3,100,735 | $ | 2,786,442 | $ | 2,298,581 | 11.3 | % | 21.2 | % | |||||||||||
Segment earnings
|
$ | 445,186 | $ | 382,644 | $ | 280,346 | 16.3 | % | 36.5 | % | ||||||||||
Operating margin
|
14.4 | % | 13.7 | % | 12.2 | % | ||||||||||||||
Other measures:
|
||||||||||||||||||||
Segment depreciation and amortization
|
$ | 74,776 | $ | 72,526 | $ | 68,992 | 3.1 | % | 5.1 | % | ||||||||||
Bookings
|
||||||||||||||||||||
Refrigeration & Industrial
|
$ | 2,512,706 | $ | 2,291,896 | $ | 1,757,916 | 9.6 | % | 30.4 | % | ||||||||||
Fluid Solutions
|
682,832 | 573,886 | 481,149 | 19.0 | % | 19.3 | % | |||||||||||||
Eliminations
|
(2,816 | ) | (2,412 | ) | (1,109 | ) | ||||||||||||||
$ | 3,192,722 | $ | 2,863,370 | $ | 2,237,956 | 11.5 | % | 27.9 | % | |||||||||||
Backlog
|
||||||||||||||||||||
Refrigeration & Industrial
|
$ | 528,118 | $ | 446,267 | $ | 373,938 | 18.3 | % | 19.3 | % | ||||||||||
Fluid Solutions
|
54,194 | 47,123 | 41,496 | 15.0 | % | 13.6 | % | |||||||||||||
Eliminations
|
(177 | ) | (315 | ) | (115 | ) | ||||||||||||||
$ | 582,135 | $ | 493,075 | $ | 415,319 | 18.1 | % | 18.7 | % | |||||||||||
Components of revenue growth:
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||||
Organic growth
|
9.4 | % | 15.8 | % | ||||||||||||||||
Acquisitions and divestitures, net
|
0.6 | % | 6.0 | % | ||||||||||||||||
Foreign currency translation
|
1.3 | % | -0.6 | % | ||||||||||||||||
11.3 | % | 21.2 | % |
Years Ended December 31,
|
% Change
|
|||||||||||||||||||
2011
|
2010
|
2009
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Revenue
|
$ | 1,592,964 | $ | 1,476,830 | $ | 1,133,499 | 7.9 | % | 30.3 | % | ||||||||||
Segment earnings
|
$ | 226,534 | $ | 237,368 | $ | 78,026 | -4.6 | % | 204.2 | % | ||||||||||
Operating margin
|
14.2 | % | 16.1 | % | 6.9 | % | ||||||||||||||
Other measures:
|
||||||||||||||||||||
Segment depreciation and amortization
|
$ | 46,148 | $ | 46,302 | $ | 51,532 | -0.3 | % | -10.1 | % | ||||||||||
Bookings
|
1,562,719 | 1,573,044 | 1,157,242 | -0.7 | % | 35.9 | % | |||||||||||||
Backlog
|
180,871 | 213,589 | 117,734 | -15.3 | % | 81.4 | % | |||||||||||||
Components of revenue growth:
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||||
Organic growth
|
4.8 | % | 30.5 | % | ||||||||||||||||
Acquisitions
|
0.0 | % | 0.8 | % | ||||||||||||||||
Foreign currency translation
|
3.1 | % | -1.0 | % | ||||||||||||||||
7.9 | % | 30.3 | % |
Years Ended Ended December 31,
|
||||||||||||
Cash Flows from Continuing Operations
(in thousands)
|
2011
|
2010
|
2009
|
|||||||||
Net Cash Flows Provided By (Used In):
|
||||||||||||
Operating activities
|
$ | 1,058,229 | $ | 901,862 | $ | 743,381 | ||||||
Investing activities
|
(1,020,940 | ) | (171,518 | ) | (252,184 | ) | ||||||
Financing activities
|
(50,501 | ) | (304,788 | ) | (388,453 | ) |
Years Ended Ended December 31,
|
||||||||||||
Free Cash Flow
(dollars in thousands)
|
2011
|
2010
|
2009
|
|||||||||
Cash flow provided by operating activities
|
$ | 1,058,229 | $ | 901,862 | $ | 743,381 | ||||||
Less: Capital expenditures
|
(271,809 | ) | (174,845 | ) | (112,972 | ) | ||||||
Free cash flow
|
$ | 786,420 | $ | 727,017 | $ | 630,409 | ||||||
Free cash flow as a percentage of revenue
|
9.9 | % | 10.9 | % | 11.8 | % |
At December 31,
|
||||||||||||
Net Debt to Net Capitalization Ratio
(dollars in thousands)
|
2011
|
2010
|
2009
|
|||||||||
Current maturities of long-term debt
|
$ | 1,022 | $ | 1,590 | $ | 35,624 | ||||||
Commercial paper
|
- | 15,000 | - | |||||||||
Long-term debt
|
2,186,230 | 1,790,886 | 1,825,260 | |||||||||
Total debt
|
2,187,252 | 1,807,476 | 1,860,884 | |||||||||
Less: Cash, cash equivalents and short-term investments
|
(1,206,755 | ) | (1,310,813 | ) | (940,245 | ) | ||||||
Net debt
|
980,497 | 496,663 | 920,639 | |||||||||
Add: Stockholders' equity
|
4,930,555 | 4,526,562 | 4,083,608 | |||||||||
Net capitalization
|
$ | 5,911,052 | $ | 5,023,225 | $ | 5,004,247 | ||||||
Net debt to net capitalization
|
16.6 | % | 9.9 | % | 18.4 | % |
Short Term Rating
|
Long Term Rating
|
Outlook
|
|||
Moody's
|
P-1
|
A2
|
Stable
|
||
Standard & Poor's
|
A-1
|
A
|
Stable
|
||
Fitch
|
F1
|
A
|
Stable
|
Payments Due by Period
|
||||||||||||||||||||||||
(in thousands)
|
Total
|
Less Than 1 Year
|
1-3 Years
|
3-5 Years
|
More than 5 Years
|
Other
(4)
|
||||||||||||||||||
Long-term debt (1)
|
$ | 2,187,252 | $ | 1,022 | $ | 523 | $ | 299,248 | $ | 1,886,459 | $ | - | ||||||||||||
Interest expense (2)
|
1,934,370 | 117,788 | 235,575 | 217,903 | 1,363,104 | - | ||||||||||||||||||
Rental commitments
|
245,077 | 62,948 | 80,939 | 39,845 | 61,345 | - | ||||||||||||||||||
Purchase obligations
|
57,202 | 46,853 | 9,788 | 561 | - | - | ||||||||||||||||||
Capital leases
|
5,345 | 1,606 | 1,796 | 904 | 1,039 | - | ||||||||||||||||||
Supplemental & post-retirement benefits (3)
|
167,580 | 19,992 | 21,469 | 48,389 | 77,730 | - | ||||||||||||||||||
Uncertain tax positions (4)
|
184,467 | 1,576 | - | - | - | 182,891 | ||||||||||||||||||
Total obligations
|
$ | 4,781,293 | $ | 251,785 | $ | 350,090 | $ | 606,850 | $ | 3,389,677 | $ | 182,891 |
(1)
|
See Note 8 to the Consolidated Financial Statements. Amounts represent total long-term debt, including current maturities.
|
(2)
|
Amounts represent estimate of future interest payments on long-term debt using the interest rates in effect at December 31, 2011.
|
(3)
|
Amounts represent estimated benefit payments under our supplemental and post-retirement benefit plans. See Note 13 to the Consolidated Financial Statements. We also expect to contribute approximately $20 to $40 million to our qualified defined benefit plans in 2012, which amount is not reflected in the above table.
|
(4)
|
Due to the uncertainty of the potential settlement of future uncertain tax positions, we are unable to estimate the timing of the related payments, if any, that will be made subsequent to 2012. These amounts do not include the potential indirect benefits resulting from deductions or credits for payments made to other jurisdictions.
|
·
|
Revenue is recognized when all of the following circumstances are satisfied: a) persuasive evidence of an arrangement exists, b) price is fixed or determinable, c) collectability is reasonably assured, and d) delivery has occurred or services have been rendered. The majority of our revenue is generated through the manufacture and sale of a broad range of specialized products and components, with revenue recognized upon transfer of title and risk of loss, which is generally upon shipment. Service revenue represents less than 10% of our total revenue and is recognized as the services are performed.
In limited cases, our revenue arrangements with customers require delivery, installation, testing, certification or other acceptance provisions to be satisfied before revenue is recognized. We do not have significant multiple deliverable arrangements.
|
·
|
Inventory for the majority of our subsidiaries, including all international subsidiaries, are stated at the lower of cost, determined on the first-in, first-out (FIFO) basis, or market. Other domestic inventory is stated at cost, determined on the last-in, first-out (LIFO) basis, which is less than market value. Under certain market conditions, estimates and judgments regarding the valuation of inventory are employed by us to properly value inventory. Businesses within our Communication Technologies and Printing & Identification segments tend to experience somewhat higher levels of inventory value fluctuations, particularly given the relatively high rate of product obsolescence over relatively short periods of time.
|
·
|
We have significant tangible and intangible assets on our balance sheet that include goodwill and other intangibles related to acquisitions. The valuation and classification of these assets and the assignment of useful depreciation and amortization lives involve significant judgments and the use of estimates. The testing of these intangibles under established accounting guidelines for impairment also requires significant use of judgment and assumptions, particularly as it relates to the identification of reporting units and the determination of fair market value. Our assets and reporting units are tested and reviewed for impairment on an annual basis during the fourth quarter or, when indicators of impairment exist, such as a significant sustained change in the business climate, or when a significant portion of a reporting unit is to be reclassified to discontinued operations, during the interim periods. We estimate fair value using discounted cash flow analyses (i.e. an income approach) which incorporate management assumptions relating to future growth and profitability. Changes in business or market conditions could impact the future cash flows used in such analyses. We believe that our use of estimates and assumptions are reasonable and comply with generally accepted accounting principles. No goodwill impairment was indicated by the testing of our 17 identified reporting units in the fourth quarter of 2011, and the fair value of each of the reporting units exceeded the carrying value by at least 30% and, in most cases, significantly more. If the fair value of each of the reporting units was decreased by 10%, the resulting fair value would still have exceeded the carrying value and no impairment would have been recognized.
|
·
|
The valuation of our pension and other post-retirement plans requires the use of assumptions and estimates that are used to develop actuarial valuations of expenses and assets/liabilities. Inherent in these valuations are key assumptions, including discount rates, investment returns, projected salary increases and benefits, and mortality rates. Annually, we review the actuarial assumptions used in our pension reporting and compare them with external benchmarks to ensure that they accurately account for our future pension obligations. Changes in assumptions and future investment returns could potentially have a material impact on our pension expense and related funding requirements. Our expected long-term rate of return on plan assets is reviewed annually based on actual returns, economic trends and portfolio allocation. Our discount rate assumption is determined by developing a yield curve based on high quality corporate bonds with maturities matching the plans’ expected benefit payment streams. The plans’ expected cash flows are then discounted by the resulting year-by-year spot rates. As disclosed in
Note 13 to
the Consolidated Financial Statements, the 2011 weighted-average discount rates used to measure our qualified defined benefit, supplemental and other post-retirement obligations ranged from 4.45% to 4.85%, reduced from the 2010 rates, which ranged from 5.04% to 5.50%. The reduced discount rates are reflective of the decline in global market interest rates over these periods. A 25 basis point decrease in the discount rates used for these plans would have increased the post retirement benefit obligations by approximately $32.3 million from the amount recorded in the financial statements at December 31, 2011. Our pension expense is also sensitive to changes in the expected long-term rate of return on plan assets. A decrease of 25 basis points in the expected long-term rate of return on assets would have increased our defined benefit pension expense by approximately $1.5 million.
|
·
|
We have significant amounts of deferred tax assets that are reviewed for recoverability and valued accordingly. These assets are evaluated by using estimates of future taxable income streams and the impact of tax planning strategies. Reserves are also estimated, using more likely than not criteria, for ongoing audits regarding federal, state and international issues that are currently unresolved. We routinely monitor the potential impact of these situations and believe that we have established the proper reserves. Reserves related to tax accruals and valuations related to deferred tax assets can be impacted by changes in accounting regulations, changes in tax codes and rulings, changes in statutory tax rates, and our future taxable income levels. The provision for uncertain tax positions provides a recognition threshold and measurement attribute for financial statement tax benefits taken or expected to be taken in a tax return and disclosure requirements regarding uncertainties in income tax positions. The tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. We record interest and penalties related to unrecognized tax benefits as a component of our provision for income taxes.
|
·
|
We have significant accruals and reserves related to the self-insured portion of our risk management program. These accruals require the use of estimates and judgment with regard to risk exposure and ultimate liability. We estimate losses under these programs using actuarial assumptions, our experience and relevant industry data. We review these factors quarterly and consider the current level of accruals and reserves adequate relative to current market conditions and experience.
|
·
|
We have established liabilities for environmental and legal contingencies at both the business and corporate levels. A significant amount of judgment and the use of estimates are required to quantify our ultimate exposure in these matters. The valuation of liabilities for these contingencies is reviewed on a quarterly basis to ensure that we have accrued the proper level of expense. The liability balances are adjusted to account for changes in circumstances for ongoing issues and the establishment of additional liabilities for emerging issues. While we believe that the amount accrued to-date is adequate, future changes in circumstances could impact these determinations.
|
·
|
Occasionally, we will establish liabilities for restructuring activities at an operation, in accordance with appropriate accounting principles. These liabilities, for both severance and exit costs, require the use of estimates. Though we believe that these estimates accurately reflect the anticipated costs, actual results may be different than the estimated amounts.
|
·
|
We will from time to time discontinue certain operations for various reasons. Estimates are used to adjust, if necessary, the assets and liabilities of discontinued operations, including goodwill, to their estimated fair market value. These estimates include assumptions relating to the proceeds anticipated as a result of the sale. Fair value is established using internal valuation calculations along with market analysis of similar-type entities. The adjustments to fair market value of these operations provide the basis for the gain or loss when sold. Changes in business conditions or the inability to sell an operation could potentially require future adjustments to these estimates.
|
·
|
We are required to recognize in our consolidated statements of earnings the expense associated with all share-based payment awards made to employees and directors, including stock options, stock appreciation rights (SARs), restricted stock and performance share awards. We use the Black-Scholes valuation model to estimate the fair value of SARs and stock options granted to employees. The model requires that we estimate the expected life of the SAR or option, expected forfeitures and the volatility of our stock using historical data. We use the Monte Carlo simulation model to estimate fair value of performance share awards which also require us to estimate the volatility of our stock and the volatility of returns on the stock of our peer group as well as the correlation of the returns between the companies in the peer group. For additional information related to the assumptions used,
see Note 10
to the Consolidated Financial Statements in Item 8 of this Form 10-K.
|
Page
|
||
|
|
/s/ PricewaterhouseCoopers LLP | |
Chicago, Illinois | |||
February 10, 2012 | |||
Years Ended December 31,
|
||||||||||||
2011
|
2010
|
2009
|
||||||||||
Net earnings
|
$ | 895,243 | $ | 700,104 | $ | 356,438 | ||||||
Other comprehensive earnings (loss), net of tax
|
||||||||||||
Foreign currency translation adjustments:
|
||||||||||||
Foreign currency translation (losses) gains during period
|
(71,612 | ) | (34,667 | ) | 76,969 | |||||||
Reclassification of foreign currency translation losses (gains)
|
||||||||||||
to earnings upon sale of subsidiaries
|
11,090 | 1,031 | (527 | ) | ||||||||
Total foreign currency translation
|
(60,522 | ) | (33,636 | ) | 76,442 | |||||||
Pension and other postretirement benefit plans:
|
||||||||||||
Actuarial losses arising during period
|
(46,284 | ) | (7,342 | ) | (14,069 | ) | ||||||
Prior service (cost) credit arising during period
|
(1,067 | ) | (1,848 | ) | 1,081 | |||||||
Amortization of actuarial losses included in net periodic pension cost
|
5,646 | 2,731 | 3,605 | |||||||||
Amortization of prior service costs included in net periodic pension cost
|
5,390 | 5,180 | 5,876 | |||||||||
Total pension and other postretirement plans
|
(36,315 | ) | (1,279 | ) | (3,507 | ) | ||||||
Cash flow hedges:
|
||||||||||||
Unrealized net (losses) gains arising during period
|
(948 | ) | 623 | 44 | ||||||||
Net (gains) losses reclassified into earnings
|
(124 | ) | (389 | ) | 1,047 | |||||||
Total cash flow hedges
|
(1,072 | ) | 234 | 1,091 | ||||||||
Other
|
238 | - | - | |||||||||
Other comprehensive (loss) earnings
|
(97,671 | ) | (34,681 | ) | 74,026 | |||||||
Comprehensive earnings
|
$ | 797,572 | $ | 665,423 | $ | 430,464 |
December 31, 2011
|
December 31, 2010
|
|||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 1,206,755 | $ | 1,189,079 | ||||
Short-term investments
|
- | 121,734 | ||||||
Receivables, net of allowances of $24,987 and $29,856
|
1,190,265 | 1,023,099 | ||||||
Inventories, net
|
803,346 | 657,962 | ||||||
Prepaid and other current assets
|
154,859 | 56,817 | ||||||
Deferred tax assets
|
41,905 | 82,934 | ||||||
Total current assets
|
3,397,130 | 3,131,625 | ||||||
Property, plant and equipment, net
|
1,000,870 | 785,624 | ||||||
Goodwill
|
3,787,117 | 3,107,478 | ||||||
Intangible assets, net
|
1,207,084 | 799,281 | ||||||
Other assets and deferred charges
|
104,808 | 107,642 | ||||||
Assets of discontinued operations
|
4,441 | 627,093 | ||||||
Total assets
|
$ | 9,501,450 | $ | 8,558,743 | ||||
Current liabilities:
|
||||||||
Notes payable and current maturities of long-term debt
|
$ | 1,022 | $ | 16,590 | ||||
Accounts payable
|
543,924 | 438,288 | ||||||
Accrued compensation and employee benefits
|
281,611 | 263,934 | ||||||
Accrued insurance
|
104,172 | 110,860 | ||||||
Other accrued expenses
|
234,382 | 228,004 | ||||||
Income taxes payable
|
37,870 | 87,372 | ||||||
Total current liabilities
|
1,202,981 | 1,145,048 | ||||||
Long-term debt
|
2,186,230 | 1,790,886 | ||||||
Deferred income taxes
|
411,163 | 304,711 | ||||||
Other liabilities
|
650,604 | 562,009 | ||||||
Liabilities of discontinued operations
|
119,917 | 229,527 | ||||||
Stockholders' Equity:
|
||||||||
Preferred stock - $100 par value; 100,000 shares authorized; none issued
|
- | - | ||||||
Common stock - $1 par value; 500,000,000 shares authorized; 250,591,610 and 249,361,340 shares
issued at December 31, 2011 and 2010, respectively
|
250,592 | 249,361 | ||||||
Additional paid-in capital
|
663,289 | 596,457 | ||||||
Retained earnings
|
6,629,116 | 5,953,027 | ||||||
Accumulated other comprehensive (loss) earnings
|
(47,510 | ) | 50,161 | |||||
Common stock in treasury
|
(2,564,932 | ) | (2,322,444 | ) | ||||
Total stockholders' equity
|
4,930,555 | 4,526,562 | ||||||
Total liabilities and stockholders' equity
|
$ | 9,501,450 | $ | 8,558,743 |
Common Stock
$1 Par Value
|
Additional
Paid-In Capital
|
Retained
Earnings
|
Accumulated Other Comprehensive
Earnings (Loss)
|
Treasury
Stock
|
Total
Stockholders'
Equity
|
|||||||||||||||||||
Balance at December 31, 2008
|
$ | 246,615 | $ | 455,228 | $ | 5,286,458 | $ | 10,816 | $ | (2,206,251 | ) | $ | 3,792,866 | |||||||||||
Net earnings
|
- | - | 356,438 | - | - | 356,438 | ||||||||||||||||||
Dividends paid
|
- | - | (189,874 | ) | - | - | (189,874 | ) | ||||||||||||||||
Common stock issued for options exercised
|
712 | 24,807 | - | - | - | 25,519 | ||||||||||||||||||
Tax benefit from the exercise of stock options
|
- | 425 | - | - | - | 425 | ||||||||||||||||||
Stock-based compensation expense
|
- | 17,176 | - | - | - | 17,176 | ||||||||||||||||||
Common stock issued, net of cancellations
|
15 | 617 | - | - | - | 632 | ||||||||||||||||||
Issuance of treasury stock
|
- | (962 | ) | - | - | 7,362 | 6,400 | |||||||||||||||||
Other comprehensive earnings
|
- | - | - | 74,026 | - | 74,026 | ||||||||||||||||||
Balance at December 31, 2009
|
$ | 247,342 | $ | 497,291 | $ | 5,453,022 | $ | 84,842 | $ | (2,198,889 | ) | $ | 4,083,608 | |||||||||||
Net earnings
|
- | - | 700,104 | - | - | 700,104 | ||||||||||||||||||
Dividends paid
|
- | - | (200,099 | ) | - | - | (200,099 | ) | ||||||||||||||||
Common stock issued for options exercised
|
1,983 | 69,465 | - | - | - | 71,448 | ||||||||||||||||||
Tax benefit from the exercise of stock options
|
- | 6,466 | - | - | - | 6,466 | ||||||||||||||||||
Stock-based compensation expense
|
- | 21,464 | - | - | - | 21,464 | ||||||||||||||||||
Common stock issued, net of cancellations
|
36 | 1,771 | - | - | - | 1,807 | ||||||||||||||||||
Common stock acquired
|
- | - | - | - | (123,555 | ) | (123,555 | ) | ||||||||||||||||
Other comprehensive loss
|
- | - | - | (34,681 | ) | - | (34,681 | ) | ||||||||||||||||
Balance at December 31, 2010
|
$ | 249,361 | $ | 596,457 | $ | 5,953,027 | $ | 50,161 | $ | (2,322,444 | ) | $ | 4,526,562 | |||||||||||
Net earnings
|
- | - | 895,243 | - | - | 895,243 | ||||||||||||||||||
Dividends paid
|
- | - | (219,154 | ) | - | - | (219,154 | ) | ||||||||||||||||
Common stock issued for options exercised
|
1,155 | 25,063 | - | - | - | 26,218 | ||||||||||||||||||
Tax benefit from the exercise of stock options
|
- | 8,752 | - | - | - | 8,752 | ||||||||||||||||||
Stock-based compensation expense
|
- | 25,391 | - | - | - | 25,391 | ||||||||||||||||||
Common stock issued, net of cancellations
|
76 | 4,780 | - | - | - | 4,856 | ||||||||||||||||||
Common stock acquired
|
- | - | - | - | (242,488 | ) | (242,488 | ) | ||||||||||||||||
Other comprehensive earnings
|
- | - | - | (97,671 | ) | - | (97,671 | ) | ||||||||||||||||
Other
|
- | 2,846 | - | - | - | 2,846 | ||||||||||||||||||
Balance at December 31, 2011
|
$ | 250,592 | $ | 663,289 | $ | 6,629,116 | $ | (47,510 | ) | $ | (2,564,932 | ) | $ | 4,930,555 | ||||||||||
Years Ended December 31,
|
||||||||||||
2011
|
2010
|
2009
|
||||||||||
Operating Activities of Continuing Operations
|
||||||||||||
Net earnings
|
$ | 895,243 | $ | 700,104 | $ | 356,438 | ||||||
Adjustments to reconcile net earnings to cash from operating activities:
|
||||||||||||
(Gain) loss from discontinued operations, net
|
(48,878 | ) | (9,353 | ) | 16,985 | |||||||
Depreciation and amortization
|
303,143 | 241,969 | 231,363 | |||||||||
Stock-based compensation
|
25,991 | 21,207 | 17,158 | |||||||||
Provision for losses on accounts receivable (net of recoveries)
|
6,442 | (847 | ) | 12,894 | ||||||||
Deferred income taxes
|
6,110 | 66,226 | (12,305 | ) | ||||||||
Employee benefit plan expense
|
39,954 | 32,914 | 37,221 | |||||||||
Loss on extinguishment of long-term debt
|
- | 4,343 | - | |||||||||
Other non-current
|
48,248 | 19,649 | 16,577 | |||||||||
Cash effect of changes in current assets and liabilities (excluding effects of
acquisitions, dispositions and foreign exchange):
|
||||||||||||
Accounts receivable
|
(95,708 | ) | (181,084 | ) | 119,224 | |||||||
Inventories
|
(46,115 | ) | (132,785 | ) | 79,783 | |||||||
Prepaid expenses and other assets
|
(8,801 | ) | 5,719 | 21,628 | ||||||||
Accounts payable
|
72,434 | 93,765 | (20,378 | ) | ||||||||
Accrued expenses
|
(10,658 | ) | 94,728 | (89,582 | ) | |||||||
Accrued taxes
|
(65,609 | ) | 3,508 | 35,329 | ||||||||
Contributions to employee benefit plans
|
(63,567 | ) | (58,201 | ) | (78,954 | ) | ||||||
Net cash provided by operating activities of continuing operations
|
1,058,229 | 901,862 | 743,381 | |||||||||
Investing Activities of Continuing Operations
|
||||||||||||
Proceeds from sale of short-term investments
|
124,410 | 553,466 | 406,033 | |||||||||
Purchase of short-term investments
|
- | (466,881 | ) | (348,439 | ) | |||||||
Proceeds from the sale of property, plant and equipment
|
9,986 | 16,660 | 21,617 | |||||||||
Additions to property, plant and equipment
|
(271,809 | ) | (174,845 | ) | (112,972 | ) | ||||||
Proceeds from sales of businesses
|
516,901 | 4,500 | 3,571 | |||||||||
Settlement of net investment hedge
|
(18,211 | ) | - | - | ||||||||
Acquisitions (net of cash and cash equivalents acquired)
|
(1,382,217 | ) | (104,418 | ) | (221,994 | ) | ||||||
Net cash used in investing activities of continuing operations
|
(1,020,940 | ) | (171,518 | ) | (252,184 | ) | ||||||
Financing Activities of Continuing Operations
|
||||||||||||
Change in notes payable, net
|
(15,002 | ) | 15,000 | (192,749 | ) | |||||||
Reduction of long-term debt
|
(402,654 | ) | (75,855 | ) | (32,408 | ) | ||||||
Proceeds from long-term debt, net of discount and issuance costs
|
788,971 | - | - | |||||||||
Purchase of common stock
|
(242,488 | ) | (123,555 | ) | - | |||||||
Proceeds from exercise of stock options and SARs, including tax benefits
|
39,826 | 79,721 | 26,578 | |||||||||
Dividends to stockholders
|
(219,154 | ) | (200,099 | ) | (189,874 | ) | ||||||
Net cash used in financing activities of continuing operations
|
(50,501 | ) | (304,788 | ) | (388,453 | ) | ||||||
Cash Flows from Discontinued Operations
|
||||||||||||
Net cash provided by operating activities of discontinued operations
|
19,749 | 44,315 | 49,734 | |||||||||
Net cash used in investing activities of discontinued operations
|
(4,851 | ) | (7,236 | ) | (6,454 | ) | ||||||
Net cash provided by discontinued operations
|
14,898 | 37,079 | 43,280 | |||||||||
Effect of exchange rate changes on cash and cash equivalents
|
15,990 | 10,008 | 20,523 | |||||||||
Net increase in cash and cash equivalents
|
17,676 | 472,643 | 166,547 | |||||||||
Cash and cash equivalents at beginning of period
|
1,189,079 | 716,436 | 549,889 | |||||||||
Cash and cash equivalents at end of period
|
$ | 1,206,755 | $ | 1,189,079 | $ | 716,436 | ||||||
Supplemental information -- cash paid during the year for:
|
||||||||||||
Income taxes
|
$ | 281,084 | $ | 103,357 | $ | 111,247 | ||||||
Interest
|
$ | 121,810 | $ | 115,935 | $ | 116,773 |
1.
|
Description of Business and Summary of Significant Accounting Policies
|
2.
|
Acquisitions
|
Date
|
Type
|
Company / Product Line Acquired
|
Location (Near)
|
Segment
|
3-Jan
|
Stock
|
Harbison-Fischer, Inc.
|
Crowley, TX
|
Energy
|
Designer and manufacturer of down-hole rod pumps and related products used in artificial lift applications around the world.
|
||||
5-Jan
|
Asset/Stock
|
Dosmatic, Inc.
|
Carrollton, TX
|
Engineeered Systems
|
Manufacturer of non-electric chemical metering equipment used in agricultural, horticulture and other industrial market segments.
|
||||
26-Jan
|
Stock
|
TAGC Limited LLC
|
Muscat, Oman
|
Energy
|
Oilfield services provider, servicing both conventional and coiled sucker rod wells in the Middle East.
|
||||
28-Jan
|
Asset
|
EnviroGear Product Line
|
Franklin Park, IL
|
Engineered Systems
|
Manufacturer of magnetically coupled internal gear pumps used in a wide range of industrial manufacturing.
|
||||
4-Jul
|
Stock
|
Sound Solutions
|
Vienna, Austria and Beijing, China
|
Communication Technologies
|
Manufacturer of dynamic speakers and receivers for cell phones and other consumer electronics.
|
||||
1-Sep
|
Stock
|
Oil Lift
|
Calgary, Canada
|
Energy
|
Manufacturer of surface drive systems for progressive cavity pumps serving the artificial lift segment of the oil and gas industry.
|
||||
1-Sep
|
Asset
|
Tierra Alta Canada
|
Edmonton, Canada
|
Energy
|
Manufacturer of progressive cavity pumps serving the artificial lift segment of the oil and gas industry.
|
||||
1-Nov
|
Stock
|
RedScrew Pump Manufacturing
|
Tianjin, China
|
Engineered Systems
|
Manufacturer of Twin and Triple screw pumps, as well as multiphase and specialty pumps, serving oil and gas, petrochemical and marine markets.
|
||||
7-Nov
|
Stock
|
Advansor A/S
|
Arhus, Denmark
|
Engineered Systems
|
Designer and manufacturer of HFC-free, CO
2
transcritical refrigeration and heat pump systems for supermarkets and light industrial applications.
|
Sound Solutions
|
Other Acquisitions
|
Total
|
||||||||||
Current assets, net of cash acquired
|
$ | 88,339 | $ | 119,834 | $ | 208,173 | ||||||
Property, plant and equipment
|
86,335 | 52,334 | 138,669 | |||||||||
Goodwill
|
443,088 | 291,176 | 734,264 | |||||||||
Intangible assets
|
295,889 | 260,397 | 556,286 | |||||||||
Other non-current assets
|
12,504 | 4,298 | 16,802 | |||||||||
Total liabilities
|
(141,625 | ) | (170,108 | ) | (311,733 | ) | ||||||
Net assets acquired
|
$ | 784,530 | $ | 557,931 | $ | 1,342,461 |
Communication
Technologies
|
Energy
|
Engineered
Systems
|
Total
|
|||||||||||||
Goodwill - Tax deductible
|
$ | 302,000 | $ | 924 | $ | 3,856 | $ | 306,780 | ||||||||
Goodwill - Non deductible
|
141,088 | 256,204 | 30,192 | 427,484 | ||||||||||||
Trademarks
|
8,200 | 8,234 | 2,197 | 18,631 | ||||||||||||
Customer intangibles
|
280,000 | 207,964 | 18,439 | 506,403 | ||||||||||||
Patents
|
7,500 | 9,820 | 1,906 | 19,226 | ||||||||||||
Other intangibles
|
189 | 5,414 | 6,423 | 12,026 | ||||||||||||
$ | 738,977 | $ | 488,560 | $ | 63,013 | $ | 1,290,550 |
Date
|
Type
|
Company / Product Line Acquired
|
Location (Near)
|
Segment
|
4-May
|
Stock
|
BSC Filters
|
York, UK
|
Communication Technologies
|
Designer and manufacturer of microwave filters, diplexers, waveguide and coaxial passive components.
|
||||
1-Jun
|
Asset
|
Chemilizer
|
Largo, FL
|
Engineered Systems
|
Manufacturer of non-electric, volumetric dosing equipment used in commercial animal raising, agriculture, horticulture and irrigation markets.
|
||||
17-Aug
|
Asset
|
Intek Manufacturing
|
Fort Wayne, IN
|
Engineered Systems
|
Manufacturer of electric and gas steam equipment (steamers, kettles, braising pans).
|
||||
30-Sep
|
Asset
|
Diagnostic Product Line - Dynalco Controls
|
Ft. Lauderdale, FL
|
Energy
|
Manufacturer and servicer of portable analyzers targeting the gas gathering and gas transmission markets.
|
||||
30-Sep
|
Stock
|
Gear Products
|
Tulsa, OK
|
Energy
|
Manufacturer of worm gear and planetary hoists, rotation drives, rotation bearings and hydraulic pump drives.
|
||||
24-Nov
|
Asset
|
KMC/Bearings Inc.
|
Houston, TX / Rhode Island
|
Energy
|
Designer and manufacturer of fluid film bearings serving process plant, refinery, deep hole drilling, plant air and refridgeration industries.
|
Years Ended December 31,
|
||||||||
2011
|
2010
|
|||||||
Revenue from continuing operations:
|
||||||||
As reported
|
$ | 7,950,140 | $ | 6,640,191 | ||||
Pro forma
|
8,142,808 | 7,233,927 | ||||||
Net earnings from continuing operations:
|
||||||||
As reported
|
$ | 846,365 | $ | 690,751 | ||||
Pro forma
|
857,446 | 726,980 | ||||||
Basic earnings per share from continuing operations:
|
||||||||
As reported
|
$ | 4.55 | $ | 3.70 | ||||
Pro forma
|
4.61 | 3.89 | ||||||
Diluted earnings per share from continuing operations:
|
||||||||
As reported
|
$ | 4.48 | $ | 3.65 | ||||
Pro forma
|
4.54 | 3.84 |
3.
|
Disposed and Discontinued Operations
|
Years Ended December 31,
|
||||||||||||
2011
|
2010
|
2009
|
||||||||||
Revenue
|
$ | 551,761 | $ | 508,767 | $ | 490,813 | ||||||
Loss on sale (including impairments), net of taxes
|
$ | (4,743 | ) | $ | (14,203 | ) | $ | (11,170 | ) | |||
Earnings (loss) from operations before taxes
|
47,773 | 21,962 | (4,853 | ) | ||||||||
Benefit (provision) for income taxes
|
5,848 | 1,594 | (962 | ) | ||||||||
Earnings (loss) from discontinued operations, net of tax
|
$ | 48,878 | $ | 9,353 | $ | (16,985 | ) |
December 31, 2011
|
December 31, 2010
|
|||||||
Assets of Discontinued Operations
|
||||||||
Current assets
|
$ | 2,832 | $ | 191,408 | ||||
Non-current assets
|
1,609 | 435,685 | ||||||
$ | 4,441 | $ | 627,093 | |||||
Liabilities of Discontinued Operations
|
||||||||
Current liabilities
|
$ | 31,592 | $ | 91,933 | ||||
Non-current liabilities
|
88,325 | 137,594 | ||||||
$ | 119,917 | $ | 229,527 |
4.
|
Inventories
|
December 31, 2011
|
December 31, 2010
|
|||||||
Raw materials
|
$ | 372,627 | $ | 316,052 | ||||
Work in progress
|
177,016 | 139,579 | ||||||
Finished goods
|
309,048 | 248,073 | ||||||
Subtotal
|
858,691 | 703,704 | ||||||
Less LIFO reserve
|
55,345 | 45,742 | ||||||
Total
|
$ | 803,346 | $ | 657,962 |
5.
|
Property, Plant & Equipment
|
December 31, 2011
|
December 31, 2010
|
|||||||
Land
|
$ | 54,113 | $ | 45,793 | ||||
Buildings and improvements
|
586,538 | 516,331 | ||||||
Machinery, equipment and other
|
2,033,926 | 1,801,714 | ||||||
2,674,577 | 2,363,838 | |||||||
Accumulated depreciation
|
(1,673,707 | ) | (1,578,214 | ) | ||||
Total
|
$ | 1,000,870 | $ | 785,624 |
6.
|
Goodwill and Other Intangible Assets
|
Communication
Technologies
|
Energy
|
Engineered
Systems
|
Printing &
Identification
|
Total
|
||||||||||||||||
Goodwill
|
$ | 802,265 | $ | 335,612 | $ | 987,378 | $ | 1,035,412 | $ | 3,160,667 | ||||||||||
Accumulated impairment loss
|
- | - | (70,912 | ) | - | (70,912 | ) | |||||||||||||
Balance at January 1, 2010
|
802,265 | 335,612 | 916,466 | 1,035,412 | 3,089,755 | |||||||||||||||
Acquisitions
|
4,435 | 30,234 | 5,417 | - | 40,086 | |||||||||||||||
Foreign currency translation
|
283 | 2,609 | (5,812 | ) | (6,788 | ) | (9,708 | ) | ||||||||||||
Purchase price adjustment
|
- | (996 | ) | (11,659 | ) | - | (12,655 | ) | ||||||||||||
Balance at December 31, 2010
|
806,983 | 367,459 | 904,412 | 1,028,624 | 3,107,478 | |||||||||||||||
Acquisitions
|
443,088 | 257,128 | 34,048 | - | 734,264 | |||||||||||||||
Foreign currency translation
|
(45,489 | ) | (2,252 | ) | (3,040 | ) | (3,844 | ) | (54,625 | ) | ||||||||||
Balance at December 31, 2011
|
$ | 1,204,582 | $ | 622,335 | $ | 935,420 | $ | 1,024,780 | $ | 3,787,117 |
December 31, 2011
|
December 31, 2010
|
|||||||||||||||
Gross Carrying
Amount
|
Accumulated
Amortization
|
Gross Carrying
Amount
|
Accumulated
Amortization
|
|||||||||||||
Amortized Intangible Assets:
|
||||||||||||||||
Trademarks
|
$ | 66,428 | $ | 20,518 | $ | 41,712 | $ | 16,664 | ||||||||
Patents
|
145,864 | 99,990 | 127,081 | 92,146 | ||||||||||||
Customer Intangibles
|
1,171,608 | 380,196 | 685,939 | 290,001 | ||||||||||||
Unpatented Technologies
|
142,405 | 98,193 | 138,780 | 86,461 | ||||||||||||
Drawings & Manuals
|
8,165 | 5,153 | 6,230 | 4,326 | ||||||||||||
Distributor Relationships
|
73,162 | 28,500 | 73,183 | 24,724 | ||||||||||||
Other
|
28,677 | 20,251 | 27,878 | 18,120 | ||||||||||||
Total
|
1,636,309 | 652,801 | 1,100,803 | 532,442 | ||||||||||||
Unamortized Intangible Assets:
|
||||||||||||||||
Trademarks
|
223,576 | 230,920 | ||||||||||||||
Total Intangible Assets
|
$ | 1,859,885 | $ | 652,801 | $ | 1,331,723 | $ | 532,442 |
2012
|
$ | 120,359 |
2013
|
119,284 | |
2014
|
111,192 | |
2015
|
110,650 | |
2016
|
105,778 |
7.
|
Accrued Expenses and Other Liabilities
|
December 31, 2011
|
December 31, 2010
|
|||||||
Warranty
|
$ | 38,378 | $ | 38,885 | ||||
Unearned/deferred revenue
|
37,590 | 52,400 | ||||||
Taxes other than income
|
27,318 | 26,443 | ||||||
Accrued interest
|
30,747 | 27,679 | ||||||
Accrued volume discounts
|
17,243 | 13,774 | ||||||
Accrued commissions (non-employee)
|
11,069 | 9,629 | ||||||
Restructuring and exit
|
5,016 | 5,282 | ||||||
Legal and environmental
|
1,920 | 2,973 | ||||||
Other (none of which are individually significant)
|
65,101 | 50,939 | ||||||
$ | 234,382 | $ | 228,004 |
December 31,
2011
|
December 31,
2010
|
|||||||
Deferred compensation
|
$ | 358,647 | $ | 255,347 | ||||
Tax reserves
|
182,891 | 196,446 | ||||||
Unearned/deferred revenue
|
44,259 | 47,768 | ||||||
Legal and environmental
|
18,910 | 19,234 | ||||||
Warranty
|
4,146 | 1,147 | ||||||
Restructuring and exit
|
576 | 2,337 | ||||||
Other, including net investment hedge
|
41,175 | 39,730 | ||||||
$ | 650,604 | $ | 562,009 |
2011
|
2010
|
|||||||
Beginning Balance, January 1
|
$ | 40,032 | $ | 41,232 | ||||
Provision for warranties
|
35,313 | 37,354 | ||||||
Settlements made
|
(35,706 | ) | (37,692 | ) | ||||
Other adjustments, including acquisitions and currency translation
|
2,885 | (862 | ) | |||||
Ending Balance, December 31
|
$ | 42,524 | $ | 40,032 | ||||
Severance
|
Exit
|
Total
|
||||||||||
At December 31, 2008 (A)
|
$ | 7,203 | $ | 21,485 | $ | 28,688 | ||||||
Provision
|
51,558 | 15,764 | 67,322 | |||||||||
Payments
|
(50,617 | ) | (12,543 | ) | (63,160 | ) | ||||||
Purchase accounting
|
- | (16,074 | ) | (16,074 | ) | |||||||
Other
|
8 | (1,378 | ) | (1,370 | ) | |||||||
At December 31, 2009 (B)
|
8,152 | 7,254 | 15,406 | |||||||||
Provision
|
2,948 | 3,212 | 6,160 | |||||||||
Payments
|
(9,732 | ) | (4,484 | ) | (14,216 | ) | ||||||
Other
|
(225 | ) | 494 | 269 | ||||||||
At December 31, 2010
|
1,143 | 6,476 | 7,619 | |||||||||
Provision
|
2,382 | 3,313 | 5,695 | |||||||||
Payments
|
(992 | ) | (5,991 | ) | (6,983 | ) | ||||||
Other
|
(70 | ) | (669 | ) | (739 | ) | ||||||
At December 31, 2011
|
$ | 2,463 | $ | 3,129 | $ | 5,592 |
8.
|
Borrowings and Lines of Credit
|
December 31, 2011
|
December 31, 2010
|
|||||||
6.50% 10-year notes due February 15, 2011
|
$ | - | $ | 399,986 | ||||
4.875% 10-year notes due October 15, 2015
|
299,244 | 299,047 | ||||||
5.45% 10-year notes due March 15, 2018
|
347,938 | 347,608 | ||||||
4.30% 10-year notes due March 1, 2021
|
449,761 | - | ||||||
6.60% 30-year notes due March 15, 2038
|
247,683 | 247,595 | ||||||
5.375% 30-year notes due March 1, 2041
|
345,352 | - | ||||||
6.65% 30-year debentures due June 1, 2028
|
199,414 | 199,379 | ||||||
5.375% 30-year debentures due October 15, 2035
|
296,208 | 296,048 | ||||||
Other, including commercial paper
|
1,652 | 17,813 | ||||||
Total long-term debt
|
2,187,252 | 1,807,476 | ||||||
Less current portion
|
(1,022 | ) | (16,590 | ) | ||||
$ | 2,186,230 | $ | 1,790,886 |
2012
|
$ | 1,022 | |
2013
|
511 | ||
2014
|
12 | ||
2015
|
299,248 | ||
2016 and thereafter
|
1,886,459 |
Years ended December 31,
|
||||||||||||
2011
|
2010
|
2009
|
||||||||||
Interest expense
|
$ | 124,878 | $ | 115,388 | $ | 116,159 | ||||||
Interest income
|
9,282 | 8,966 | 15,687 | |||||||||
Interest expense, net
|
$ | 115,596 | $ | 106,422 | $ | 100,472 | ||||||
9.
|
Financial Instruments
|
Fair Value - Asset (Liability)
|
|||||||||
December 31, 2011
|
December 31, 2010
|
Balance Sheet Caption
|
|||||||
Foreign currency forward / collar contracts
|
$ | 394 | $ | 503 |
Prepaid / Other assets
|
||||
Foreign currency forward / collar contracts
|
(1,284 | ) | - |
Other accrued expenses
|
|||||
Net investment hedge - cross currency swap
|
(21,656 | ) | (19,774 | ) |
Other liabilities
|
·
|
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
|
·
|
Level 2 inputs include inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of assets or liabilities.
|
·
|
Level 3 inputs are unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
|
December 31, 2011
|
December 31, 2010
|
|||||||||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||||||||
Assets:
|
||||||||||||||||||||||||
Short-term investments
|
$ | - | $ | - | $ | - | $ | 121,734 | $ | - | $ | - | ||||||||||||
Foreign currency cash flow hedges
|
- | 394 | - | - | 503 | - | ||||||||||||||||||
Liabilities:
|
||||||||||||||||||||||||
Net investment hedge derivative
|
- | 21,656 | - | - | 19,774 | - | ||||||||||||||||||
Foreign currency cash flow hedges
|
- | 1,284 | - | - | - | - |
10.
|
Equity and Cash Incentive Program
|
Years ended December 31,
|
||||||||||||
2011
|
2010
|
2009
|
||||||||||
Pre-tax compensation expense
|
$ | 25,991 | $ | 21,207 | $ | 17,158 | ||||||
Tax benefit
|
(9,097 | ) | (7,422 | ) | (6,005 | ) | ||||||
Total stock-based compensation expense, net of tax
|
$ | 16,894 | $ | 13,785 | $ | 11,153 |
2011 Grant
|
2010 Grant
|
2009 Grant
|
||||||||||
Risk-free interest rate
|
2.68 | % | 2.77 | % | 2.06 | % | ||||||
Dividend yield
|
1.70 | % | 2.33 | % | 3.23 | % | ||||||
Expected life (years)
|
5.8 | 6.0 | 6.5 | |||||||||
Volatility
|
33.56 | % | 31.93 | % | 30.47 | % | ||||||
SAR grant price
|
$ | 66.59 | $ | 42.88 | $ | 29.45 | ||||||
Fair value of SAR award
|
$ | 20.13 | $ | 11.66 | $ | 6.58 |
SARs
|
Stock Options
|
|||||||||||||||||||||||||||||||
Number of Shares
|
Weighted Average Exercise Price
|
Aggregate Intrinsic Value
|
Weighted Average Remaining Contractual Term (Years)
|
Number of Shares
|
Weighted Average Exercise Price
|
Aggregate Intrinsic Value
|
Weighted Average Remaining Contractual Term (Years)
|
|||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Outstanding at 1/1/2011
|
9,432,013 | $ | 40.63 | 2,899,135 | $ | 36.79 |
|
|||||||||||||||||||||||||
Granted
|
1,524,329 | 66.59 | - | - |
|
|||||||||||||||||||||||||||
Forfeited / expired
|
(308,882 | ) | 42.03 | (77,699 | ) | 38.75 |
|
|||||||||||||||||||||||||
Exercised
|
(1,253,826 | ) | 45.54 | $ | 24,322 | (878,342 | ) | 36.24 | $ | 24,726 |
|
|||||||||||||||||||||
Outstanding at 12/31/2011
|
9,393,634 | 44.14 | 143,317 | 6.38 | 1,943,094 | 36.96 | 40,989 | 2.11 | ||||||||||||||||||||||||
Total exercisable at December 31, 2011
|
3,302,555 | $ | 45.92 | $ | 40,051 | 4.35 | 1,943,094 | $ | 36.96 | $ | 40,989 | 2.11 | ||||||||||||||||||||
SARs Outstanding
|
SARs Exercisable
|
|||||||||||||||||||||||||
Range of Exercise Prices
|
Number
|
Weighted Average
Exercise Price
|
Weighted Average
Remaining Life
in Years
|
Number
|
Weighted Average
Exercise Price
|
Weighted Average
Remaining Life
in Years
|
||||||||||||||||||||
$ | 29.45 - $35.50 | 2,490,684 | $ | 29.52 | 6.28 | - | $ | - | - | |||||||||||||||||
$ | 42.30 - $46.00 | 4,378,418 | 43.33 | 6.09 | 2,255,049 | 43.75 | 4.47 | |||||||||||||||||||
$ | 50.60 - $66.59 | 2,524,532 | 59.96 | 6.96 | 1,047,506 | 50.60 | 4.11 |
Options Outstanding
|
Options Exercisable
|
|||||||||||||||||||||||||
Range of Exercise Prices
|
Number
|
Weighted Average
Exercise Price
|
Weighted Average
Remaining Life
in Years
|
Number
|
Weighted Average
Exercise Price
|
Weighted Average
Remaining Life
in Years
|
||||||||||||||||||||
$ | 24.50 - $31.00 | 294,397 | $ | 24.53 | 1.12 | 294,397 | $ | 24.53 | 1.12 | |||||||||||||||||
$ | 33.00 - $39.00 | 1,052,031 | 38.00 | 2.41 | 1,052,031 | 38.00 | 2.41 | |||||||||||||||||||
$ | 39.40 - $43.00 | 596,666 | 41.24 | 2.06 | 596,666 | 41.24 | 2.06 |
2011 Grant
|
2010 Grant
|
2009 Grant
|
||||||||||
Risk-free interest rate
|
1.34 | % | 1.37 | % | 1.30 | % | ||||||
Dividend yield
|
1.61 | % | 2.38 | % | 2.93 | % | ||||||
Expected life (years)
|
2.9 | 2.9 | 2.7 | |||||||||
Volatility
|
40.48 | % | 39.98 | % | 39.57 | % | ||||||
Fair value of performance award
|
$ | 91.41 | $ | 57.49 | $ | 35.79 |
Years ended December 31,
|
||||||
2011
|
2010
|
2009
|
||||
Aggregate shares granted
|
20,929
|
20,853
|
21,549
|
|||
Shares withheld to satisfy tax obligations
|
(562)
|
(574)
|
(6,823)
|
|||
Net shares granted
|
20,367
|
20,279
|
14,726
|
11.
|
Income Taxes
|
Years Ended December 31,
|
||||||||||||
2011
|
2010
|
2009
|
||||||||||
Domestic
|
$ | 582,510 | $ | 443,655 | $ | 259,121 | ||||||
Foreign
|
512,654 | 455,549 | 235,288 | |||||||||
$ | 1,095,164 | $ | 899,204 | $ | 494,409 |
Years Ended December 31,
|
||||||||||||
2011
|
2010
|
2009
|
||||||||||
Current:
|
||||||||||||
U.S. Federal
|
$ | 159,888 | $ | 29,622 | $ | 77,295 | ||||||
State and local
|
(12,016 | ) | 6,363 | 3,718 | ||||||||
Foreign
|
107,220 | 105,234 | 67,204 | |||||||||
Total current - continuing
|
255,092 | 141,219 | 148,217 | |||||||||
Deferred:
|
||||||||||||
U.S. Federal
|
$ | 4,048 | $ | 92,661 | $ | (16,395 | ) | |||||
State and local
|
(2,533 | ) | 97 | 219 | ||||||||
Foreign
|
(7,808 | ) | (25,524 | ) | (11,055 | ) | ||||||
Total deferred - continuing
|
(6,293 | ) | 67,234 | (27,231 | ) | |||||||
Total expense - continuing
|
$ | 248,799 | $ | 208,453 | $ | 120,986 |
Years Ended December 31,
|
||||||
2011
|
2010
|
2009
|
||||
U.S. Federal income tax rate
|
35.0
|
%
|
35.0
|
%
|
35.0
|
% |
State and local taxes, net of Federal income tax benefit
|
1.6
|
1.2
|
1.3
|
|||
Foreign operations tax effect
|
(7.9)
|
(8.3)
|
(5.3)
|
|||
Subtotal
|
(6.3)
|
(7.1)
|
(4.0)
|
|||
R&E tax credits
|
(0.3)
|
(0.4)
|
(0.4)
|
|||
Domestic manufacturing deduction
|
(1.5)
|
(0.8)
|
(0.9)
|
|||
Foreign tax credits
|
0.3
|
(0.5)
|
1.1
|
|||
Branch losses
|
-
|
(0.5)
|
(1.1)
|
|||
Release of valuation allowance
|
(0.9)
|
-
|
-
|
|||
Resolution of tax contingencies
|
(4.9)
|
(4.2)
|
(6.8)
|
|||
Other, principally non-tax deductible items
|
1.3
|
1.7
|
1.6
|
|||
Effective rate from continuing operations
|
22.7
|
%
|
23.2
|
%
|
24.5
|
% |
December 31, 2011
|
December 31, 2010
|
|||||||
Deferred Tax Assets:
|
||||||||
Accrued compensation, principally postretirement and other employee benefits
|
$ | 166,848 | $ | 115,839 | ||||
Accrued expenses, principally for state income taxes, interest and warranty
|
55,006 | 63,317 | ||||||
Net operating loss and other carryforwards
|
26,277 | 68,558 | ||||||
Inventories, principally due to reserves for financial reporting purposes
|
||||||||
and capitalization for tax purposes
|
19,044 | 23,261 | ||||||
Accounts receivable, principally due to allowance for doubtful accounts
|
5,223 | 6,768 | ||||||
Accrued insurance
|
3,947 | 10,433 | ||||||
Prepaid pension assets
|
3,415 | 1,619 | ||||||
Long-term liabilities, principally warranty, environmental, and exit costs
|
796 | 759 | ||||||
Other assets
|
13,378 | 9,993 | ||||||
Total gross deferred tax assets
|
293,934 | 300,547 | ||||||
Valuation allowance
|
(22,724 | ) | (38,136 | ) | ||||
Total deferred tax assets
|
$ | 271,210 | $ | 262,411 | ||||
Deferred Tax Liabilities:
|
||||||||
Intangible assets, principally due to different tax and financial
|
||||||||
reporting bases and amortization lives
|
$ | (577,275 | ) | $ | (431,317 | ) | ||
Plant and equipment, principally due to differences in depreciation
|
(56,751 | ) | (45,797 | ) | ||||
Accounts receivable
|
(6,442 | ) | (7,074 | ) | ||||
Total gross deferred tax liabilities
|
(640,468 | ) | (484,188 | ) | ||||
Net deferred tax liability
|
$ | (369,258 | ) | $ | (221,777 | ) | ||
Classified as follows in the consolidated balance sheets:
|
||||||||
Current deferred tax asset
|
$ | 41,905 | $ | 82,934 | ||||
Non-current deferred tax liability
|
(411,163 | ) | (304,711 | ) | ||||
$ | (369,258 | ) | $ | (221,777 | ) |
Continuing
|
Discontinued
|
Total
|
||||||||||
Unrecognized tax benefits at January 1, 2009
|
$ | 202,162 | $ | 49,544 | $ | 251,706 | ||||||
Additions based on tax positions related to the current year
|
45,891 | 39,722 | 85,613 | |||||||||
Additions for tax positions of prior years
|
5,607 | 2,756 | 8,363 | |||||||||
Reductions for tax positions of prior years
|
(8,855 | ) | (2,656 | ) | (11,511 | ) | ||||||
Settlements
|
(40,704 | ) | (7,079 | ) | (47,783 | ) | ||||||
Lapse of statutes
|
(6,979 | ) | (2,843 | ) | (9,822 | ) | ||||||
Unrecognized tax benefits at December 31, 2009
|
197,122 | 79,444 | 276,566 | |||||||||
Additions based on tax positions related to the current year
|
22,324 | 242 | 22,566 | |||||||||
Additions for tax positions of prior years
|
15,258 | - | 15,258 | |||||||||
Reductions for tax positions of prior years
|
(39,824 | ) | (6,775 | ) | (46,599 | ) | ||||||
Settlements
|
(8,152 | ) | (17,804 | ) | (25,956 | ) | ||||||
Lapse of statutes
|
(7,521 | ) | (133 | ) | (7,654 | ) | ||||||
Unrecognized tax benefits at December 31, 2010
|
179,207 | 54,974 | 234,181 | |||||||||
Additions based on tax positions related to the current year
|
11,575 | 246 | 11,821 | |||||||||
Additions for tax positions of prior years
|
16,595 | 12 | 16,607 | |||||||||
Reductions for tax positions of prior years
|
(43,853 | ) | (9,012 | ) | (52,865 | ) | ||||||
Settlements
|
(7,042 | ) | (3,100 | ) | (10,142 | ) | ||||||
Lapse of statutes
|
(6,197 | ) | (216 | ) | (6,413 | ) | ||||||
Unrecognized tax benefits at December 31, 2011
|
$ | 150,285 | (A) | $ | 42,904 | $ | 193,189 |
(A)
|
If recognized, the net amount of potential tax benefits that would impact the Company’s effective tax rate is $125.1 million. During the years ended December 31, 2011, 2010, and 2009, the Company recorded potential interest and penalty expense (income) of $(9.1) million, $1.5 million and $5.0 million, respectively, related to its unrecognized tax benefits as a component of provision for income taxes. The Company had accrued interest and penalties of $34.2 million at December 31, 2011 and $45.6 million at December 31, 2010, which are not included in the above table.
|
12.
|
Commitments and Contingent Liabilities
|
Operating
|
Capital
|
|||||||
2012
|
$ | 62,948 | $ | 1,606 | ||||
2013
|
45,275 | 1,269 | ||||||
2014
|
35,664 | 527 | ||||||
2015
|
23,593 | 496 | ||||||
2016
|
16,252 | 408 | ||||||
2017 and thereafter
|
61,345 | 1,039 |
13.
|
Employee Benefit Plans
|
2011
|
2010
|
|||||||||||||
Projected benefit obligation (PBO)
|
$317,223
|
$241,923
|
||||||||||||
Accumulated benefit obligation (ABO)
|
259,850
|
201,617
|
||||||||||||
Fair value of plan assets
|
82,654
|
66,485
|
Qualified Defined Benefits
|
||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Plan
|
Non-U.S. Plans
|
Non-Qualified Supplemental Benefits |
Post-Retirement Benefits
|
|||||||||||||||||||||||||||||||||||||||||||||
2011
|
2010
|
2009
|
2011
|
2010
|
2009
|
2011
|
2010
|
2009
|
2011
|
2010
|
2009
|
|||||||||||||||||||||||||||||||||||||
Service Cost
|
$ | 14,167 | $ | 11,272 | $ | 10,959 | $ | 3,278 | $ | 3,415 | $ | 3,012 | $ | 4,064 | $ | 4,241 | $ | 6,188 | $ | 206 | $ | 279 | $ | 314 | ||||||||||||||||||||||||
Interest Cost
|
27,237 | 22,531 | 21,555 | 9,019 | 8,043 | 7,381 | 7,841 | 7,677 | 8,688 | 723 | 837 | 959 | ||||||||||||||||||||||||||||||||||||
Expected return on plan assets
|
(38,472 | ) | (31,912 | ) | (28,998 | ) | (8,148 | ) | (6,377 | ) | (5,614 | ) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Amortization of:
|
||||||||||||||||||||||||||||||||||||||||||||||||
Prior service cost (income)
|
1,304 | 1,303 | 1,258 | 122 | 62 | 34 | 7,266 | 7,266 | 7,706 | (409 | ) | (409 | ) | (172 | ) | |||||||||||||||||||||||||||||||||
Transition obligation
|
- | - | - | (44 | ) | (42 | ) | (43 | ) | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||
Recognized actuarial (gain) loss
|
8,335 | 5,082 | 4,913 | 254 | 392 | 303 | - | - | - | (241 | ) | (398 | ) | (426 | ) | |||||||||||||||||||||||||||||||||
Settlement and curtailment gain (loss)
|
1,180 | - | - | 2,030 | (347 | ) | (795 | ) | - | - | (1 | ) | (137 | ) | - | - | ||||||||||||||||||||||||||||||||
Other
|
123 | - | - | - | - | - | - | - | - | 256 | - | - | ||||||||||||||||||||||||||||||||||||
Total net periodic benefit cost
|
$ | 13,874 | $ | 8,276 | $ | 9,687 | $ | 6,511 | $ | 5,146 | $ | 4,278 | $ | 19,171 | $ | 19,184 | $ | 22,581 | $ | 398 | $ | 309 | $ | 675 |
Qualified Defined Benefits
|
Non-Qualified Supplemental Benefits
|
Post-Retirement
|
||||||||||
U.S. Plan
|
Non-U.S. Plans
|
|||||||||||
Amortization of:
|
||||||||||||
Prior service cost (income)
|
$ |
1,048
|
$ |
119
|
$ |
7,425
|
$ |
(409)
|
||||
Transition obligation
|
-
|
(46)
|
-
|
-
|
||||||||
Recognized actuarial loss (gain)
|
13,515
|
597
|
138
|
(173)
|
||||||||
Total
|
$ |
14,563
|
$ |
670
|
$ |
7,563
|
$ |
(582)
|
Qualified Defined Benefits
|
Non-Qualified
|
Post-Retirement Benefits
|
|||||||||||||
U.S. Plan
|
Non-U.S. Plans
|
Supplemental Benefits
|
|||||||||||||
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
||||||||
Discount rate
|
4.85%
|
5.50%
|
4.62%
|
5.04%
|
4.77%
|
5.50%
|
4.45%
|
5.10%
|
|||||||
Average wage increase
|
4.00%
|
4.50%
|
3.43%
|
3.73%
|
4.50%
|
4.50%
|
na
|
na
|
|||||||
Ultimate medical trend rate
|
-
|
-
|
-
|
-
|
-
|
-
|
5.00%
|
5.00%
|
Qualified Defined Benefits
|
Non- Qualified Supplemental Benefits
|
||||||||||||||||||||||
U.S. Plan
|
Non-U.S. Plans
|
Post-Retirement Benefits
|
|||||||||||||||||||||
2011
|
2010
|
2009
|
2011
|
2010
|
2009
|
2011
|
2010
|
2009
|
2011
|
2010
|
2009
|
||||||||||||
Discount rate
|
5.50%
|
5.95%
|
6.10%
|
5.04%
|
5.15%
|
5.45%
|
5.50%
|
5.95%
|
6.10%
|
5.10%
|
5.50%
|
6.00%
|
|||||||||||
Average wage increase
|
4.50%
|
4.50%
|
4.50%
|
3.73%
|
3.68%
|
3.72%
|
4.50%
|
4.50%
|
6.00%
|
na
|
na
|
na
|
|||||||||||
Expected return on plan assets
|
7.75%
|
7.75%
|
7.75%
|
6.45%
|
6.10%
|
6.51%
|
-
|
-
|
-
|
-
|
-
|
-
|
December 2011
|
December 2010
|
Current Target
|
|||
Equity - domestic
|
39%
|
40%
|
35%
|
||
Equity - international
|
19%
|
22%
|
22%
|
||
Fixed income - domestic
|
36%
|
32%
|
35%
|
||
Real estate and other
|
6%
|
6%
|
8%
|
||
Total
|
100%
|
100%
|
100%
|
U.S. Plan
|
||||||||||||||||||||||||||||||||
At December 31, 2011
|
At December 31, 2010
|
|||||||||||||||||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total Fair Value
|
Level 1
|
Level 2
|
Level 3
|
Total Fair Value
|
|||||||||||||||||||||||||
Asset category:
|
||||||||||||||||||||||||||||||||
Common stocks:
|
||||||||||||||||||||||||||||||||
U.S. companies
|
$ | 153,816 | $ | - | $ | - | $ | 153,816 | $ | 126,567 | $ | - | $ | - | $ | 126,567 | ||||||||||||||||
Non-U.S. companies
|
3,065 | - | - | 3,065 | 5,381 | - | - | 5,381 | ||||||||||||||||||||||||
Fixed income investments:
|
||||||||||||||||||||||||||||||||
Corporate bonds
|
- | 55,716 | - | 55,716 | - | 41,254 | - | 41,254 | ||||||||||||||||||||||||
Private placements
|
- | 3,791 | - | 3,791 | - | 3,085 | - | 3,085 | ||||||||||||||||||||||||
Government securities
|
9,268 | 115,873 | - | 125,141 | 6,070 | 77,691 | - | 83,761 | ||||||||||||||||||||||||
Common stock funds:
|
||||||||||||||||||||||||||||||||
Mutual funds
|
38,476 | - | - | 38,476 | 32,533 | - | - | 32,533 | ||||||||||||||||||||||||
Collective trusts
|
- | 94,396 | - | 94,396 | - | 89,093 | - | 89,093 | ||||||||||||||||||||||||
Real estate funds
|
- | - | 26,481 | 26,481 | - | - | 23,056 | 23,056 | ||||||||||||||||||||||||
Other
|
- | - | 4,561 | 4,561 | - | - | - | - | ||||||||||||||||||||||||
Cash and equivalents
|
9,748 | - | - | 9,748 | 5,053 | - | - | 5,053 | ||||||||||||||||||||||||
$ | 214,373 | $ | 269,776 | $ | 31,042 | $ | 515,191 | $ | 175,604 | $ | 211,123 | $ | 23,056 | $ | 409,783 |
Non-U.S. Plans
|
||||||||||||||||||||||||||||||||
At December 31, 2011
|
At December 31, 2010
|
|||||||||||||||||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total Fair Value
|
Level 1
|
Level 2
|
Level 3
|
Total Fair Value
|
|||||||||||||||||||||||||
Asset category:
|
||||||||||||||||||||||||||||||||
Common stocks
|
$ | 23,450 | $ | - | $ | - | $ | 23,450 | $ | 28,265 | $ | - | $ | - | $ | 28,265 | ||||||||||||||||
Fixed income investments
|
- | 36,629 | - | 36,629 | - | 38,221 | - | 38,221 | ||||||||||||||||||||||||
Common stock funds
|
- | 49,680 | - |
49,680
|
- | 41,596 | - | 41,596 | ||||||||||||||||||||||||
Real estate funds
|
- | - | 7,053 | 7,053 | - | - | 7,349 | 7,349 | ||||||||||||||||||||||||
Cash and equivalents
|
2,258 | - | - | 2,258 | 5,098 | - | - | 5,098 | ||||||||||||||||||||||||
Other
|
- | 2,737 | - | 2,737 | - | 1,286 | - | 1,286 | ||||||||||||||||||||||||
$ | 25,708 | $ | 89,046 | $ | 7,053 | $ | 121,807 | $ | 33,363 | $ | 81,103 | $ | 7,349 | $ | 121,815 | |||||||||||||||||
Level 3 Investments
|
||||
Balance at December 31, 2009
|
$ | 26,120 | ||
Realized losses
|
(26 | ) | ||
Unrealized gains
|
2,444 | |||
Purchases, sales, issuances and settlements, net
|
1,867 | |||
Balance at December 31, 2010
|
$ | 30,405 | ||
Realized gains
|
(3 | ) | ||
Unrealized gains
|
2,348 | |||
Purchases, sales, issuances and settlements, net
|
5,345 | |||
Balance at December 31, 2011
|
$ | 38,095 | ||
Qualified Defined Benefits
|
Non-Qualified Supplemental Benefits
|
Post-Retirement Benefits
|
||||||||||
U.S. Plan
|
Non-U.S. Plans
|
|||||||||||
2012
|
$ |
46,340
|
$ |
4,382
|
$ |
18,913
|
$ |
$1,079
|
||||
2013
|
34,628
|
4,585
|
11,901
|
1,078
|
||||||||
2014
|
35,044
|
4,780
|
7,417
|
1,073
|
||||||||
2015
|
35,398
|
5,847
|
33,329
|
1,085
|
||||||||
2016
|
35,102
|
5,834
|
12,905
|
1,070
|
||||||||
2017-2021
|
193,191
|
38,543
|
73,184
|
4,546
|
14.
|
Other Comprehensive Earnings
|
Pre-tax
|
Tax
|
Net of tax
|
||||||||||
Year Ended December 31, 2011
|
||||||||||||
Foreign currency translation adjustments
|
$ | (74,476 | ) | $ | 13,954 | $ | (60,522 | ) | ||||
Pension and other post retirement plan adjustments
|
(54,519 | ) | 18,204 | (36,315 | ) | |||||||
Changes in fair value of cash flow hedges and other
|
(1,379 | ) | 545 | (834 | ) | |||||||
$ | (130,374 | ) | $ | 32,703 | $ | (97,671 | ) | |||||
Year Ended December 31, 2010
|
||||||||||||
Foreign currency translation adjustments
|
$ | (33,636 | ) | $ | - | $ | (33,636 | ) | ||||
Pension and other post retirement plan adjustments
|
(2,468 | ) | 1,189 | (1,279 | ) | |||||||
Changes in fair value of cash flow hedges
|
360 | (126 | ) | 234 | ||||||||
$ | (35,744 | ) | $ | 1,063 | $ | (34,681 | ) | |||||
Year Ended December 31, 2009
|
||||||||||||
Foreign currency translation adjustments
|
$ | 76,442 | $ | - | $ | 76,442 | ||||||
Pension and other post retirement plan adjustments
|
(1,767 | ) | (1,740 | ) | (3,507 | ) | ||||||
Changes in fair value of cash flow hedges
|
1,673 | (582 | ) | 1,091 | ||||||||
$ | 76,348 | $ | (2,322 | ) | $ | 74,026 |
2011
|
2010
|
|||||||
Cumulative foreign currency translation adjustments
|
$ | 126,992 | $ | 187,514 | ||||
Pension and other post retirement plan adjustments
|
(176,877 | ) | (140,562 | ) | ||||
Changes in fair value of cash flow hedges
|
2,375 | 3,209 | ||||||
$ | (47,510 | ) | $ | 50,161 |
15.
|
Segment Data
|
Years Ended December 31,
|
||||||||||||
2011
|
2010
|
2009
|
||||||||||
REVENUE:
|
||||||||||||
Communication Technologies
|
$ | 1,360,077 | $ | 1,076,012 | $ | 916,031 | ||||||
Energy
|
1,900,749 | 1,303,507 | 998,272 | |||||||||
Engineered Systems
|
3,100,735 | 2,786,442 | 2,298,581 | |||||||||
Printing & Identification
|
1,592,964 | 1,476,830 | 1,133,499 | |||||||||
Intra-segment eliminations
|
(4,385 | ) | (2,600 | ) | (2,052 | ) | ||||||
Total consolidated revenue
|
$ | 7,950,140 | $ | 6,640,191 | $ | 5,344,331 | ||||||
EARNINGS FROM CONTINUING OPERATIONS:
|
||||||||||||
Segment earnings:
|
||||||||||||
Communication Technologies
|
$ | 226,382 | $ | 205,215 | $ | 142,541 | ||||||
Energy
|
450,637 | 316,113 | 211,962 | |||||||||
Engineered Systems
|
445,186 | 382,644 | 280,346 | |||||||||
Printing & Identification
|
226,534 | 237,368 | 78,026 | |||||||||
Total segments
|
1,348,739 | 1,141,340 | 712,875 | |||||||||
Corporate expense / other (1)
|
137,979 | 135,714 | 117,994 | |||||||||
Net interest expense
|
115,596 | 106,422 | 100,472 | |||||||||
Earnings from continuing operations before provision for income taxes and discontinued operations
|
1,095,164 | 899,204 | 494,409 | |||||||||
Provision for taxes
|
248,799 | 208,453 | 120,986 | |||||||||
Earnings from continuing operations - total consolidated
|
$ | 846,365 | $ | 690,751 | $ | 373,423 | ||||||
OPERATING MARGINS:
|
||||||||||||
Segments:
|
||||||||||||
Communication Technologies
|
16.6 | % | 19.1 | % | 15.6 | % | ||||||
Energy
|
23.7 | % | 24.3 | % | 21.2 | % | ||||||
Engineered Systems
|
14.4 | % | 13.7 | % | 12.2 | % | ||||||
Printing & Identification
|
14.2 | % | 16.1 | % | 6.9 | % | ||||||
Total Segments
|
17.0 | % | 17.2 | % | 13.3 | % | ||||||
Earnings from continuing operations
|
13.8 | % | 13.5 | % | 9.3 | % | ||||||
DEPRECIATION and AMORTIZATION:
|
||||||||||||
Communication Technologies
|
$ | 101,839 | $ | 72,262 | $ | 69,393 | ||||||
Energy
|
77,819 | 48,842 | 40,349 | |||||||||
Engineered Systems
|
74,776 | 72,526 | 68,992 | |||||||||
Printing & Identification
|
46,148 | 46,302 | 51,532 | |||||||||
Corporate
|
2,561 | 2,037 | 1,097 | |||||||||
Consolidated total
|
$ | 303,143 | $ | 241,969 | $ | 231,363 | ||||||
CAPITAL EXPENDITURES:
|
||||||||||||
Communication Technologies
|
$ | 111,402 | $ | 41,222 | $ | 25,339 | ||||||
Energy
|
74,953 | 48,916 | 31,662 | |||||||||
Engineered Systems
|
58,610 | 57,476 | 37,612 | |||||||||
Printing & Identification
|
19,524 | 15,623 | 16,989 | |||||||||
Corporate
|
7,320 | 11,608 | 1,370 | |||||||||
Consolidated total | $ | 271,809 | $ | 174,845 | $ | 112,972 |
(1)
|
Certain expenses are maintained at the corporate level and not allocated to the segments. These expenses include executive and functional compensation costs, non-service pension costs, non-operating insurance expenses, and various administrative expenses relating to the corporate headquarters.
|
TOTAL ASSETS AT DECEMBER 31:
|
2011
|
2010
|
2009
|
|||||||||
Communication Technologies
|
$ | 2,471,918 | $ | 1,540,636 | $ | 1,530,348 | ||||||
Energy
|
1,699,395 | 1,010,415 | 831,829 | |||||||||
Engineered Systems
|
2,247,532 | 2,091,519 | 2,022,539 | |||||||||
Printing & Identification
|
1,793,589 | 1,840,870 | 1,770,640 | |||||||||
Corporate (principally cash and cash equivalents)
|
1,284,575 | 1,448,210 | 1,053,496 | |||||||||
Total assets - continuing operations
|
9,497,009 | 7,931,650 | 7,208,852 | |||||||||
Assets from discontinued operations
|
4,441 | 627,093 | 673,550 | |||||||||
Consolidated total
|
$ | 9,501,450 | $ | 8,558,743 | $ | 7,882,402 |
Revenue
|
Long-Lived Assets
|
|||||||||||||||||||
Years Ended December 31,
|
At December 31,
|
|||||||||||||||||||
2011
|
2010
|
2009
|
2011
|
2010
|
||||||||||||||||
United States
|
$ | 4,037,670 | $ | 3,439,201 | $ | 2,877,770 | $ | 571,239 | $ | 494,323 | ||||||||||
Europe
|
1,348,693 | 1,204,676 | 1,074,625 | 184,688 | 139,870 | |||||||||||||||
Other Americas
|
788,844 | 641,990 | 439,457 | 51,788 | 44,855 | |||||||||||||||
Asia
|
1,502,173 | 1,175,484 | 769,430 | 184,160 | 105,629 | |||||||||||||||
Other
|
272,760 | 178,840 | 183,049 | 8,995 | 947 | |||||||||||||||
Consolidated total | $ | 7,950,140 | $ | 6,640,191 | $ | 5,344,331 | $ | 1,000,870 | $ | 785,624 |
16.
|
Stockholders’ Equity
|
17.
|
Quarterly Data (Unaudited)
|
Continuing Operations
|
Net Earnings
|
|||||||||||||||||||||||||||||||
Quarter
|
Revenue
|
Gross Profit
|
Earnings
|
Per Share - Basic
|
Per Share - Diluted
|
Net Earnings
|
Per Share - Basic
|
Per Share - Diluted
|
||||||||||||||||||||||||
2011
|
||||||||||||||||||||||||||||||||
First
|
$ | 1,812,078 | $ | 711,751 | $ | 174,791 | $ | 0.94 | $ | 0.92 | $ | 194,905 | $ | 1.04 | $ | 1.03 | ||||||||||||||||
Second
|
1,994,970 | 775,996 | 239,198 | 1.28 | 1.26 | 249,769 | 1.34 | 1.32 | ||||||||||||||||||||||||
Third
|
2,138,606 | 806,282 | 223,438 | 1.20 | 1.19 | 172,280 | 0.93 | 0.91 | ||||||||||||||||||||||||
Fourth
|
2,004,486 | 757,395 | 208,938 | 1.13 | 1.12 | 278,289 | 1.51 | 1.49 | ||||||||||||||||||||||||
$ | 7,950,140 | $ | 3,051,424 | $ | 846,365 | 4.55 | 4.48 | $ | 895,243 | 4.82 | 4.74 | |||||||||||||||||||||
2010
|
||||||||||||||||||||||||||||||||
First
|
$ | 1,481,055 | $ | 590,452 | $ | 122,288 | $ | 0.65 | $ | 0.65 | $ | 108,127 | $ | 0.58 | $ | 0.58 | ||||||||||||||||
Second
|
1,664,447 | 658,824 | 167,226 | 0.90 | 0.89 | 169,870 | 0.91 | 0.90 | ||||||||||||||||||||||||
Third
|
1,757,253 | 680,557 | 216,331 | 1.16 | 1.15 | 223,759 | 1.20 | 1.19 | ||||||||||||||||||||||||
Fourth
|
1,737,436 | 686,772 | 184,906 | 0.99 | 0.97 | 198,348 | 1.06 | 1.04 | ||||||||||||||||||||||||
$ | 6,640,191 | $ | 2,616,605 | $ | 690,751 | 3.70 | 3.65 | $ | 700,104 | 3.75 | 3.70 |
(i)
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets;
|
(ii)
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the Company’s receipts and expenditures are being made only in accordance with authorizations of the Company’s management and directors; and
|
(iii)
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.
|
(a)
|
(b)
|
(c)
|
||||||||||
Plan Category
|
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights
|
Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights
|
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
|
|||||||||
Equity compensation plans approved by stockholders
|
11,336,728 | $ | 42.91 | 7,038,668 | ||||||||
Equity compensation plans not approved by stockholders
|
- | - | - | |||||||||
Total
|
11,336,728 | $ | 42.91 | 7,038,668 |
a)
|
The following documents are filed as part of this report:
|
(1)
|
Financial Statements. The financial statements are set forth under “Item 8. Financial Statements and Supplementary Data” of this Form 10-K.
|
(2)
|
Schedules. The following financial statement schedule is set forth under “Item 8. Financial Statements and Supplementary Data” of this Form 10-K. All other schedules have been omitted because they are not required, are not applicable or the required information is included in the financial statements or the notes thereto.
|
·
|
Schedule II – Valuation and Qualifying Accounts
|
(3)
|
Exhibits. The exhibits listed in the accompanying Exhibit Index are filed or incorporated by reference as part of this Form 10-K. The exhibits will be filed with the SEC but will not be included in the printed version of the Annual Report to Shareholders.
|
Dover Corporation
|
|||
|
By:
|
/s/
Robert A. Livingston
|
|
Robert A. Livingston | |||
President and Chief Executive Officer | |||
Signature
|
Title
|
Date
|
||
/s/
Robert W. Cremin
|
Chairman, Board of Directors
|
February 10, 2012
|
||
Robert W. Cremin
|
||||
/s/
Robert A. Livingston
|
Chief Executive Officer,
President and Director
(Principal Executive Officer)
|
February 10, 2012
|
||
Robert A. Livingston
|
||||
/s/
Brad M. Cerepak
|
Senior Vice President and
Chief Financial Officer
(Principal Financial Officer)
|
February 10, 2012
|
||
Brad M. Cerepak
|
/s/
Raymond T. Mckay, Jr.
|
Vice President, Controller
(Principal Accounting Officer)
|
February 10, 2012
|
||
Raymond T. McKay, Jr.
|
||||
/s/
David H.
Benson
|
Director
|
February 10, 2012
|
||
David H. Benson
|
||||
/s/
Jean-Pierre M. Ergas
|
Director
|
February 10, 2012
|
||
Jean-Pierre M. Ergas
|
/s/
Peter T. Francis
|
Director
|
February 10, 2012
|
||
Peter T. Francis
|
||||
/s/
Kristiane C. Graham
|
Director
|
February 10, 2012
|
||
Kristiane C. Graham
|
Signature
|
Title
|
Date
|
||
/s/
Richard K. Lochridge
|
Director
|
February 10, 2012
|
||
Richard K. Lochridge
|
||||
/s/
Bernard G. Rethore
|
Director
|
February 10, 2012
|
||
Bernard G. Rethore
|
||||
/s/
Michael B. Stubbs
|
Director
|
February 10, 2012
|
||
Michael B. Stubbs
|
/s/
Stephen
M. Todd
|
Director
|
February 10, 2012
|
||
Stephen M. Todd
|
||||
/s/
Stephen K. Wagner
|
Director
|
February 10, 2012
|
||
Stephen K. Wagner
|
||||
/s/
Mary A. Winston
|
Director
|
February 10, 2012
|
||
Mary A. Winston
|
Number of shares of Dover Common Stock - | «N__of_shares_DCS» |
SSAR Base Price Per Share - | $«Price_per_share» |
Date of Grant - | «Date_of_Grant» |
Expiration Date - | «Exp_Date» |
1.
|
Your SSAR is subject to earlier termination as provided in the Plan, for example, upon termination of employment prior to the expiration date.
|
2.
|
It is your responsibility to keep track of your SSAR grants and to ensure that you exercise your SSARs before they expire.
Dover will not remind or notify you that your SSAR is nearing its expiration date.
|
3.
|
The earliest date on which the SSAR may be exercised is the third anniversary of the Grant Date. Earlier exercise may be permitted in the event of a Change in Control or death or disability as provided in the Plan. No payment is required to exercise a SSAR.
|
4.
|
Upon exercise of your SSARs, you will be entitled to receive from Dover that number of whole shares of Dover Common Stock equal in value, on the date of exercise of the SSARs, to the excess of (A) the value of a share of Dover Common Stock on the date of exercise of the SSARs multiplied by the number of SSARs being exercised over (B) the sum of (i) the per share base price of the SSARs being exercised multiplied by the number of SSARs being exercised, plus (ii) unless you elect to pay such tax in cash, any amount of tax that must be withheld in connection with such exercise. Fractional shares shall be disregarded.
|
5.
|
By accepting this award, you hereby consent to the collection, use and transfer of any personally identifiable information about you relating to your participation in the Plan to Dover and its affiliates for the purpose of administering this SSAR award. Your personal information may be transferred to the United States, a jurisdiction that may not have an equivalent level of data protection as the laws in your home country. Dover and its affiliates will take reasonable steps to ensure the security of your personal information and to avoid unauthorized or accidental access, erasure or other use. Your personal information will only be held as long as necessary to administer the Plan or this award. You may, at any time, request access to your personal information held about you in connection with this award and make any necessary amendments to your personal information or withdraw your consent. Withdrawing your consent may affect Dover and its affiliates’ ability to administer the SSAR award.
|
6.
|
Your SSAR is not transferrable by you other than by will or the laws of descent and distribution.
|
7.
|
Dover and your employer reserve the right to amend, modify, or terminate the Plan at any time in their discretion without notice.
|
Your business unit - | «Bus_unit» |
The base year - | «Base_year» |
The performance period is the three-year period - | «Perform_period» |
Your target cash performance award payment at the 100% level - | $«Target_awd_pymnt» |
1.
|
Within two and one-half months following the end of the performance period, your Dover business unit will pay you a cash performance payment if your business unit has reached certain levels of internal total shareholder return (“iTSR”), as set forth in the Cash Performance Payout Table, and the other conditions of your award are satisfied.
|
2.
|
A summary of the definition of internal total shareholder return, or iTSR, for your business unit is set forth in the Definition of iTSR.
|
3.
|
The aggregate maximum cash payout for each business unit (determined after applying the individual payment limitation noted in the next sentence, if applicable) in respect of all cash performance awards for a specific performance period shall not exceed the product of (i) 1.75%, times (ii) the sum of the business unit’s change in entity value plus free cash flow (as such terms are defined in the Definition of iTSR) for that performance period. In no event will the cash performance payout to any one individual exceed $5 million for the performance period.
|
4.
|
By accepting this award, you hereby consent to the collection, use and transfer of any personally identifiable information about you relating to your participation in the Plan to Dover and its affiliates for the purpose of administering this cash performance award. Your personal information may be transferred to the United States, a jurisdiction that may not have an equivalent level of data protection as the laws in your home country. Dover and its affiliates will take reasonable steps to ensure the security of your personal information and to avoid unauthorized or accidental access, erasure or other use. Your personal information will only be held as long as necessary to administer the Plan or this cash performance award. You may, at any time, request access to your personal information held about you in connection with this cash performance award and make any necessary amendments to your personal information or withdraw your consent. Withdrawing your consent may affect Dover and its affiliates’ ability to administer the cash performance award.
|
5.
|
Your award is not transferrable by you other than by will or the laws of descent and distribution.
|
6.
|
Dover and your employer reserve the right to amend, modify, or terminate the Plan at any time in their discretion without notice.
|
iTSR for Performance Period | Payout (% of target) |
<6%
|
0%
|
6%
|
25%
|
9%
|
100%
|
17%
|
300%
|
>
50%
|
750%
|
Your target performance share award at the 100% level - | «Target_perf_share_awd» shares of Dover Common Stock |
The base year - | «Base_year» |
The performance period is the three-year period - | «Perf_period» |
1.
|
Within two and one-half months following the end of the performance period, Dover will distribute to you the shares of Dover Common Stock in payment of your performance share award if Dover has reached certain levels of TSR in comparison to the TSRs of the companies in its peer group as set forth in the Performance Share Payout Table, and the other conditions of your award are satisfied.
|
2.
|
By accepting this award, you hereby consent to the collection, use and transfer of any personally identifiable information about you relating to your participation in the Plan to Dover and its affiliates for the purpose of administering this performance share award. Your personal information may be transferred to the United States, a jurisdiction that may not have an equivalent level of data protection as the laws in your home country. Dover and its affiliates will take reasonable steps to ensure the security of your personal information and to avoid unauthorized or accidental access, erasure or other use. Your personal information will only be held as long as necessary to administer the Plan or this performance share award. You may, at any time, request access to your personal information held about you in connection with this performance share award and make any necessary amendments to your personal information or withdraw your consent. Withdrawing your consent may affect Dover and its affiliates’ ability to administer the performance share award.
|
3.
|
Your award is not transferable by you other than by will or the laws of descent and distribution.
|
4.
|
Dover and your employer reserve the right to amend, modify, or terminate the Plan at any time in their discretion without notice.
|
Dover 3-year TSR Performance Relative to TSR. of Peer Group Companies
|
Payout Level
|
Payout Percentage of Target Grant
|
>
75
th
Percentile
|
Maximum
|
200%
|
50
th
Percentile
|
Target
|
100%
|
35
th
Percentile
|
Threshold
|
50%
|
<
35
th
Percentile
|
Below Threshold
|
0%
|
SECTION 1.01. Definitions
|
1
|
|
SECTION 1.02. Accounting Terms and Determinations
|
10
|
|
SECTION 1.03. Classification of Loans and Borrowings
|
10
|
|
SECTION 1.04. Exchange Rates
|
10
|
|
SECTION 1.05. Terms Generally
|
11
|
SECTION 2.01. Commitments to Lend
|
11
|
|
SECTION 2.02. Notice of Borrowing
|
11
|
|
SECTION 2.03. Notice to Lenders; Funding of Loans.
|
12
|
|
SECTION 2.04. Repayment of Loans; Evidence of Debt
|
12
|
|
SECTION 2.05. Maturity of Loans
|
13
|
|
SECTION 2.06. Interest Rates
|
13
|
|
SECTION 2.07. Interest Elections
|
13
|
|
SECTION 2.08. Facility Fees
|
14
|
|
SECTION 2.09. Optional Termination or Reduction of Commitments
|
14
|
|
SECTION 2.10. Mandatory Termination of Commitments
|
14
|
|
SECTION 2.11. Prepayments
|
14
|
|
SECTION 2.12. General Provisions as to Payments.
|
15
|
|
SECTION 2.13. Funding Losses
|
15
|
|
SECTION 2.14. Computation of Interest and Fees
|
15
|
|
SECTION 2.15. Borrowing Subsidiaries
|
16
|
|
SECTION 2.16. Foreign Subsidiary Costs
|
16
|
|
SECTION 2.17. Additional Reserve Costs
|
16
|
|
SECTION 2.18. Increase in Commitments
|
17
|
|
SECTION 2.19. No Double Payment
|
17
|
|
SECTION 2.20. Special Arrangements in Respect of Designated Foreign Currency Borrowings
|
17
|
|
SECTION 2.21. Defaulting Lenders
|
17
|
SECTION 3.01. Corporate Existence and Power
|
18
|
|
SECTION 3.02. Corporate and Governmental Authorization; No Contravention
|
18
|
|
SECTION 3.03. Binding Effect
|
18
|
|
SECTION 3.04. Financial Information; No Material Adverse Change.
|
18
|
|
SECTION 3.05. Litigation[
|
18
|
|
SECTION 3.06. Compliance with ERISA
|
19
|
|
SECTION 3.07. Environmental Matters
|
19
|
|
SECTION 3.08. Taxes
|
19
|
|
SECTION 3.09. Subsidiaries
|
19
|
|
SECTION 3.10. Not an Investment Company
|
19
|
|
SECTION 3.11. Full Disclosure
|
19
|
|
SECTION 3.12. Federal Reserve Regulations
|
19
|
SECTION 4.01. Effectiveness
|
20
|
|
SECTION 4.02. Each Credit Event
|
21
|
|
SECTION 4.03. Initial Credit Event for each Borrowing Subsidiary
|
21
|
SECTION 5.01. Information
|
22
|
|
SECTION 5.02. Payment of Obligations
|
23
|
|
SECTION 5.03. Maintenance of Property; Insurance
|
23
|
|
SECTION 5.04. Conduct of Business and Maintenance of Existence
|
23
|
|
SECTION 5.05. Compliance with Laws
|
24
|
|
SECTION 5.06. Inspection of Property, Books and Records
|
24
|
|
SECTION 5.07. Interest Coverage and Debt Ratios.
|
24
|
|
SECTION 5.08. Negative Pledge
|
24
|
|
SECTION 5.09. Consolidations, Mergers and Sales of Assets
|
24
|
|
SECTION 5.10. Use of Proceeds
|
24
|
SECTION 6.01. Events of Default
|
25
|
|
SECTION 6.02. Notice of Default
|
26
|
SECTION 7.01. Appointment and Authorization
|
27
|
|
SECTION 7.02. Agent and Affiliates
|
27
|
|
SECTION 7.03. Action by Agent
|
27
|
|
SECTION 7.04. Consultation with Experts
|
27
|
|
SECTION 7.05. Liability of Agent
|
27
|
|
SECTION 7.06. Indemnification
|
27
|
|
SECTION 7.07. Credit Decision
|
28
|
|
SECTION 7.08. Successor Agent
|
28
|
|
SECTION 7.09. Agent’s Fee
|
28
|
|
SECTION 7.10. Arrangers and Syndication Agents
|
28
|
|
SECTION 7.11. Agent Designees
|
28
|
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair
|
29
|
|
SECTION 8.02. Illegality
|
29
|
|
SECTION 8.03. Increased Cost and Reduced Return
|
29
|
|
SECTION 8.04. Taxes
|
30
|
|
SECTION 8.05. ABR Loans Substituted for Affected Eurocurrency Loans
|
32
|
|
SECTION 8.06. Substitution of Lender
|
32
|
SECTION 10.01. Notices
|
34
|
|
SECTION 10.02. No Waivers
|
34
|
|
SECTION 10.03. Expenses; Indemnification
|
34
|
|
SECTION 10.04. Sharing of Set-Offs
|
35
|
|
SECTION 10.05. Amendments and Waivers
|
35
|
|
SECTION 10.06. Successors and Assigns
|
35
|
|
SECTION 10.07. Collateral
|
37
|
|
SECTION 10.08. Governing Law; Submission to Jurisdiction; Consent to Service of Process
|
37
|
|
SECTION 10.09. Counterparts; Integration; Effectiveness
|
38
|
|
SECTION 10.10. WAIVER OF JURY TRIAL
|
38
|
|
SECTION 10.11. Conversion of Currencies
|
38
|
|
SECTION 10.12. Interest Rate Limitation
|
39
|
|
SECTION 10.13. USA Patriot Act
|
39
|
|
SECTION 10.14. Confidentiality
|
39
|
|
SECTION 10.15. No Fiduciary Relationship
|
39
|
|
SECTION 10.16. Headings
|
39
|
|
SECTION 10.17. Severability
|
39
|
|
SECTION 10.18. Non-Public Information
|
39
|
DOVER CORPORATION,
|
|
by /s/ Brad M. Cerepak
|
|
Name: Brad M. Cerepak
|
|
Title: Senior Vice President & Chief Financial Officer
|
JPMORGAN CHASE BANK, N.A., in its individual capacity and as Agent,
|
|
by /s/ Richard W. Duker
|
|
Name: Richard W. Duker
|
|
|
Lender
|
Commitment
|
|||
JPMorgan Chase Bank, N.A.
|
$ | 102,000,000.00 | ||
Bank of America, N.A.
|
$ | 102,000,000.00 | ||
Wells Fargo Bank, N.A.
|
$ | 102,000,000.00 | ||
Deutsche Bank AG New York Branch
|
$ | 83,000,000.00 | ||
Goldman Sachs Bank USA
|
$ | 83,000,000.00 | ||
The Royal Bank of Scotland plc
|
$ | 83,000,000.00 | ||
Citibank, N.A.
|
$ | 65,000,000.00 | ||
Morgan Stanley Bank, N.A.
|
$ | 65,000,000.00 | ||
U.S. Bank National Association
|
$ | 65,000,000.00 | ||
HSBC Bank USA, N.A.
|
$ | 50,000,000.00 | ||
ING Bank N.V., Dublin Branch
|
$ | 50,000,000.00 | ||
Skandinaviska Enskilda Banken AB (publ)
|
$ | 50,000,000.00 | ||
The Bank of Nova Scotia
|
$ | 50,000,000.00 | ||
The Northern Trust Company
|
$ | 50,000,000.00 | ||
Total Commitments
|
$ | 1,000,000,000.00 |
[Name of Assignor],
as Assignor,
by:_________________________
Name:
Title:
|
[Consented to and]
4
Accepted:
JPMORGAN CHASE BANK, N.A., as Agent,
by:_________________________
Name:
Title:
|
|
[Name of Assignee],
as Assignee,
by:_________________________
Name:
Title:
|
[Consented to:
DOVER CORPORATION,
by:_________________________
Name:
Title:]
5
|
[NAME OF NEW BORROWING SUBSIDIARY],
|
|
by
|
|
Name:
|
|
Title:
|
JPMORGAN CHASE BANK, N.A., as Agent,
|
|
by
|
|
Name:
|
|
Title:
|
DOVER CORPORATION,
|
|
by
|
|
Name:
|
|
Title:
|
|
Re:
|
Five-Year Credit Agreement dated as of November 10, 2011, among Dover Corporation, the Borrowing Subsidiaries party thereto, the Lenders party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent
|
Name of Subsidiary
|
Jurisdiction of Incorporation
|
Revod Corporation
|
Delaware
|
Delaware Capital Formation, Inc.
|
Delaware
|
Delaware Capital Holdings, Inc.
|
Delaware
|
DFH Corporation
|
Delaware
|
Dover Global Holdings, Inc.
|
Delaware
|
Dover Europe Inc.
|
Delaware
|
Northern Lights Funding LP
|
Delaware
|
Northern Lights Partners LLC
|
Delaware
|
Dover Industrial Products, Inc.
|
Delaware
|
Vectron International Inc..
|
Delaware
|
Dover Fluid Management, Inc.
|
Delaware
|
Dover Electronic Technologies, Inc.
|
Delaware
|
Dover Engineered Systems, Inc.
|
Delaware
|
Knowles Electronics Holdings, Inc.
|
Delaware
|
Knowles Intermediate Holding Inc.
|
Delaware
|
Markem-Imaje Corporation
|
New Hampshire
|
Commitment
$[ ]
|
[ACCEDING LENDER],
by
Name:
Title:
Address:
|
DOVER CORPORATION,
|
|
by
|
|
Name:
|
|
Title:
|
JPMORGAN CHASE BANK, N.A., as Agent,
|
|
by
|
|
Name:
|
|
Title:
|
Jay L. Kloosterboer | Phone: (630) 541-1540 |
Sr. Vice President | Fax: (630) 743-2670 |
Human Resources | Email: jlk@dovercorp.com |
FB iMonitoring Inc. | Delaware |
Flexbar, Inc.
|
Delaware
|
Forward Manufacturing Company, Inc.
|
Texas
|
Gear Products, Inc.
|
Oklahoma
|
Griswold Pump Company
|
Florida
|
Harbison-Fischer, Inc.
|
Delaware
|
Hill PHOENIX, Inc.
|
Delaware
|
Honetreat Company
|
California
|
Hydro Systems Company
|
Delaware
|
Hydromotion, Inc.
|
Delaware
|
Industrial Motion Control, LLC
|
Delaware
|
Inpro/Seal LLC
|
Delaware
|
K&L Microwave, Inc.
|
Delaware
|
Knappco Corporation
|
Delaware
|
Knowles Electronics Holdings, Inc.
|
Delaware
|
Knowles Electronics Sales Corp.
|
Delaware
|
Knowles Electronics, LLC
|
Delaware
|
Foreign
|
|
Advansor A/S
|
Denmark
|
ALMATEC Maschinenbau GmbH
|
Germany
|
ATG Luther & Maelzer GmbH
|
Germany
|
atg test systems asia Ltd.
|
Taiwan
|
BlitzRotary GmbH
|
Germany
|
BSC Filters Limited
|
United Kingdom
|
Cash Services Ltd.
|
United Kingdom
|
Ceramic & Microwave Products (Shanghai) Co. Ltd.
|
China
|
Chief Automotive Technologies (Shanghai) Trading Company, Ltd.
|
China
|
Colder Products Company GmbH
|
Germany
|
Colder Products Company LTD
|
Hong Kong
|
Columbus Insurance Ltd.
|
Cayman Islands
|
Compressor Valve Engineering Limited
|
United Kingdom
|
Contact Products Japan, Ltd. (JV)
|
Japan
|
Cook Compression BV
|
Netherlands
|
C-Tech Oilwell Technologies Inc.
|
Alberta
|
Datamax Holdings Limited
|
United Kingdom
|
Datamax London Limited
|
United Kingdom
|
DEK Asia Pacific Private Limited
|
Singapore
|
DEK Consulting (Shanghai) Co., Ltd.
|
China
|
DEK Hungary Manufacturing & Technology LLC
|
Hungary
|
DEK Northern Europe Limited
|
United Kingdom
|
DEK Printing Machines (M) Sdn. Bhd.
|
Malaysia
|
DEK Printing Machines GmbH
|
Germany
|
DEK Printing Machines Limited
|
United Kingdom
|
DEK Vectorguard Ltd.
|
United Kingdom
|
De-Sta-Co (Asia) Company, Limited
|
Thailand
|
DE-STA-CO Benelux B.V.
|
Netherlands
|
De-Sta-Co Europe GmbH
|
Germany
|
DE-STA-CO FRANCE
|
France
|
DE-STA-CO Shanghai Co. Ltd.
|
China
|
De-Sta-Co-Ema Industria e Comercio Ltda.
|
Brazil
|
Dover (Schweiz) Holding GmbH
|
Switzerland
|
Dover (ShangHai) Trading Company
|
China
|
Dover Asia Trading Private Ltd.
|
Singapore
|
Dover Canada Finance LP
|
Canada
|
Dover Corporation (Canada) Acquisition 1 Limited
|
Alberta
|
Dover Corporation (Canada) Limited
|
Canada
|
Dover Corporation Regional Headquarters
|
China
|
Dover CR, spol s r.o.
|
Czech Republic
|
Dover do Brasil Ltda.
|
Brazil
|
Dover Europe Sarl
|
Switzerland
|
Dover Exports, Ltd.
|
Barbados
|
Dover France Holdings, S.A.S.
|
France
|
Dover France Participations SAS
|
France
|
Dover France Technologies S.A.S.
|
France
|
Dover German Holdings GmbH
|
Germany
|
Dover German Intra-Group Service GmbH
|
Germany
|
Dover German Partnership Holdings GmbH
|
Germany
|
Dover Global Trading Pte. Ltd.
|
Singapore
|
Dover Holdings Austria GmbH
|
Austria
|
Dover Holdings de Mexico S.A. de C.V.
|
Mexico
|
Dover Hungary Board Test Manufacturing KFT
|
Hungary
|
Dover India Pvt., Ltd.
|
India
|
Dover International B.V.
|
Netherlands
|
Dover Italy S.r.L.
|
Italy
|
Dover Luxembourg Finance Sarl
|
Luxembourg
|
Dover Luxembourg International Sarl
|
Luxembourg
|
Dover Luxembourg Sarl
|
Luxembourg
|
Dover Luxembourg Services Sarl
|
Luxembourg
|
Dover Middle East LLC
|
Oman
|
Dover Netherlands Finance B.V.
|
Netherlands
|
Dover Netherlands Services B.V.
|
Netherlands
|
Dover Resources International de Mexico S. de R.L. C.V.
|
Mexico
|
Dover Singapore Private Limited
|
Singapore
|
Dover Southeast Asia (Philippines) Corporation
|
Philippines
|
Dover UK Holdings Limited
|
United Kingdom
|
Dover UK Sales Ltd
|
United Kingdom
|
DTG International GmbH
|
Switzerland
|
DTG Technology (Shenzhen) Co., Ltd.
|
China
|
Etz Elektrisches Testzentrum Gmbh
|
Germany
|
Everett Charles Technologies (Shenzhen) Limited
|
China
|
Everett Charles Technologies (SuZhou) Co., Ltd.
|
China
|
Everett/Charles Japan, Ltd. (JV)
|
Japan
|
Ferguson CO. S.A.
|
Belgium
|
FTZ Fras- und Technologiezentrum GmbH
|
Germany
|
Harbison-Fischer Australia Pty Ltd
|
Australia
|
Harbor Electronics SBN
|
Malaysia
|
Heil-Europe Limited
|
United Kingdom
|
Hill Phoenix de Mexico, S.A. de C.V.
|
Mexico
|
Hiltap FittingsLtd
|
Canada
|
Hydronova Australia-NZ Pty Ltd
|
Australia
|
Icon Technology Company Ltd.
|
Hong Kong
|
Imaje ASPAC Pte. Ltd.
|
Singapore
|
Imaje Ink Jet Nv/Sa (Belgium)
|
Belgium
|
Imaje Inkjet Ireland Ltd.
|
Ireland
|
Imaje Nordic AB
|
Sweden
|
InfoCash Holdings Limited
|
United Kingdom
|
K&L Microwave DR, Inc.
|
Virgin Islands
|
Knowles Electronics (Beijing) Co., Ltd.
|
China
|
Knowles Electronics (Malaysia) Sdn. Bhd.
|
Malaysia
|
Knowles Electronics (Suzhou) Co., Ltd.
|
China
|
Knowles Electronics (Weifang), Inc.
|
China
|
Knowles Electronics Austria GmbH
|
Austria
|
Knowles Electronics Denmark ApS
|
Denmark
|
Knowles Electronics Japan, K.K.
|
Japan
|
Knowles Electronics Singapore Pte. Ltd
|
Singapore
|
Knowles Electronics Taiwan, Ltd.
|
Taiwan
|
Knowles Europe
|
United Kingdom
|
Knowles GmbH
|
Switzerland
|
Knowles IPC (Malaysia) Sdn. Bhd.
|
Malaysia
|
MARKEM (Shanghai) Commercial Co. Ltd.
|
China
|
MARKEM Administrative Services, S.L.U.
|
Spain
|
MARKEM FZ SA
|
Uruguay
|
MARKEM Pte. Ltd.
|
Singapore
|
MARKEM S.A. de C.V.
|
Mexico
|
MARKEM Systems Limited
|
United Kingdom
|
MARKEM UK Holdings 1 Unlimited
|
United Kingdom
|
MARKEM UK Holdings 2 Limited
|
United Kingdom
|
Markem-Imaje (China) Co., Limited
|
China
|
Markem-Imaje A/S
|
Denmark
|
Markem-Imaje AB
|
Sweden
|
Markem-Imaje AG
|
Switzerland
|
Markem-Imaje AS
|
Norway
|
Markem-Imaje B.V.
|
Netherlands
|
Markem-Imaje Co., Ltd.
|
South Korea
|
MARKEM-IMAJE Corporation | New Hampshire |
Markem-Imaje GmbH
|
Germany
|
Markem-Imaje Identificacao de Produtos Ltda.
|
Brazil
|
Markem-Imaje Inc.
|
Canada
|
1.
|
I have reviewed this Annual Report on Form 10-K of Dover Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 10, 2012
|
/s/ Brad M. Cerepak | ||
Brad M. Cerepak | |||
SVP & Chief Financial Officer (Principal Financial Officer) | |||
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
|
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 10, 2012
|
|
/s/ Robert A. Livingston | |
Robert A. Livingston | |||
Chief Executive Officer and President | |||
1.
|
The Company’s Annual Report on Form 10-K for the period ended December 31, 2011, (the “
Form 10-K
”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and
|
2.
|
Information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Dated: February 10, 2012
|
|
/s/ Robert A. Livingston | |
Robert A. Livingston | |||
Chief Executive Officer and President | |||
Dated: February 10, 2012
|
|
/s/ Brad M. Cerepak | |
Brad M. Cerepak | |||
SVP & Chief Financial Officer (Principal Financial Officer) | |||