Delaware
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53-0257888
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
|
|
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3005 Highland Parkway
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|
Downers Grove, Illinois
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60515
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
o
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(Do not check if smaller reporting company)
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Smaller reporting company
o
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Emerging growth company
o
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Page
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Three Months Ended June 30,
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|
Six Months Ended June 30,
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||||||||||||
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2018
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|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue
|
$
|
1,798,094
|
|
|
$
|
1,737,371
|
|
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$
|
3,435,765
|
|
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$
|
3,320,581
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|
Cost of goods and services
|
1,132,858
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|
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1,083,263
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|
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2,167,700
|
|
|
2,090,620
|
|
||||
Gross profit
|
665,236
|
|
|
654,108
|
|
|
1,268,065
|
|
|
1,229,961
|
|
||||
Selling, general and administrative expenses
|
428,775
|
|
|
421,270
|
|
|
863,801
|
|
|
846,987
|
|
||||
Operating earnings
|
236,461
|
|
|
232,838
|
|
|
404,264
|
|
|
382,974
|
|
||||
Interest expense
|
32,125
|
|
|
36,854
|
|
|
67,765
|
|
|
73,213
|
|
||||
Interest income
|
(2,563
|
)
|
|
(2,335
|
)
|
|
(4,620
|
)
|
|
(4,910
|
)
|
||||
Gain on sale of businesses
|
—
|
|
|
—
|
|
|
—
|
|
|
(90,093
|
)
|
||||
Other (income) expense, net
|
(4,538
|
)
|
|
259
|
|
|
(4,568
|
)
|
|
(171
|
)
|
||||
Earnings before provision for income taxes
|
211,437
|
|
|
198,060
|
|
|
345,687
|
|
|
404,935
|
|
||||
Provision for income taxes
|
44,981
|
|
|
55,585
|
|
|
69,822
|
|
|
107,372
|
|
||||
Earnings from continuing operations
|
166,456
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|
|
142,475
|
|
|
275,865
|
|
|
297,563
|
|
||||
(Loss) earnings from discontinued operations, net
|
(26,497
|
)
|
|
21,583
|
|
|
(4,472
|
)
|
|
38,742
|
|
||||
Net earnings
|
$
|
139,959
|
|
|
$
|
164,058
|
|
|
$
|
271,393
|
|
|
$
|
336,305
|
|
|
|
|
|
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||||||||
Earnings per share from continuing operations:
|
|
|
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||||||||
Basic
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$
|
1.10
|
|
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$
|
0.92
|
|
|
$
|
1.80
|
|
|
$
|
1.91
|
|
Diluted
|
$
|
1.08
|
|
|
$
|
0.90
|
|
|
$
|
1.77
|
|
|
$
|
1.89
|
|
(Loss) earnings per share from discontinued operations:
|
|
|
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|||||||||
Basic
|
$
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(0.17
|
)
|
|
$
|
0.14
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.25
|
|
Diluted
|
$
|
(0.17
|
)
|
|
$
|
0.14
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.25
|
|
Net earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.92
|
|
|
$
|
1.05
|
|
|
$
|
1.77
|
|
|
$
|
2.16
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|
Diluted
|
$
|
0.91
|
|
|
$
|
1.04
|
|
|
$
|
1.74
|
|
|
$
|
2.14
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
151,744
|
|
|
155,703
|
|
|
153,124
|
|
|
155,622
|
|
||||
Diluted
|
153,938
|
|
|
157,513
|
|
|
155,573
|
|
|
157,457
|
|
||||
Dividends paid per common share
|
$
|
0.47
|
|
|
$
|
0.44
|
|
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$
|
0.94
|
|
|
$
|
0.88
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net earnings
|
$
|
139,959
|
|
|
$
|
164,058
|
|
|
$
|
271,393
|
|
|
$
|
336,305
|
|
Other comprehensive (loss) earnings, net of tax
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation gains (losses)
|
(65,159
|
)
|
|
26,174
|
|
|
(12,851
|
)
|
|
66,071
|
|
||||
Reclassification of foreign currency translation losses to earnings
|
—
|
|
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—
|
|
|
—
|
|
|
3,875
|
|
||||
Total foreign currency translation adjustments
|
(65,159
|
)
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|
26,174
|
|
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(12,851
|
)
|
|
69,946
|
|
||||
Pension and other post-retirement benefit plans:
|
|
|
|
|
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|
||||||||
Amortization of actuarial losses included in net periodic pension cost
|
1,068
|
|
|
1,353
|
|
|
3,007
|
|
|
2,691
|
|
||||
Amortization of prior service costs included in net periodic pension cost
|
1,252
|
|
|
702
|
|
|
1,995
|
|
|
1,404
|
|
||||
Total pension and other post-retirement benefit plans
|
2,320
|
|
|
2,055
|
|
|
5,002
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|
|
4,095
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|
||||
Changes in fair value of cash flow hedges:
|
|
|
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|
|
|
|
||||||||
Unrealized net gains (losses) arising during period
|
2,105
|
|
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(1,876
|
)
|
|
3,467
|
|
|
(1,798
|
)
|
||||
Net (gains) losses reclassified into earnings
|
(457
|
)
|
|
159
|
|
|
(710
|
)
|
|
(58
|
)
|
||||
Total cash flow hedges
|
1,648
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|
|
(1,717
|
)
|
|
2,757
|
|
|
(1,856
|
)
|
||||
Other
|
—
|
|
|
(578
|
)
|
|
—
|
|
|
(241
|
)
|
||||
Other comprehensive (loss) earnings
|
(61,191
|
)
|
|
25,934
|
|
|
(5,092
|
)
|
|
71,944
|
|
||||
Comprehensive earnings
|
$
|
78,768
|
|
|
$
|
189,992
|
|
|
$
|
266,301
|
|
|
$
|
408,249
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Assets
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
242,814
|
|
|
$
|
753,964
|
|
Receivables, net of allowances of $32,435 and $34,479
|
1,281,260
|
|
|
1,183,514
|
|
||
Inventories
|
764,053
|
|
|
677,043
|
|
||
Prepaid and other current assets
|
159,601
|
|
|
175,626
|
|
||
Total current assets
|
2,447,728
|
|
|
2,790,147
|
|
||
Property, plant and equipment, net
|
805,009
|
|
|
787,940
|
|
||
Goodwill
|
3,715,365
|
|
|
3,686,372
|
|
||
Intangible assets, net
|
1,228,605
|
|
|
1,282,624
|
|
||
Other assets and deferred charges
|
276,463
|
|
|
245,723
|
|
||
Assets of discontinued operations
|
—
|
|
|
1,865,553
|
|
||
Total assets
|
$
|
8,473,170
|
|
|
$
|
10,658,359
|
|
Liabilities and Stockholders' Equity
|
|||||||
Current liabilities:
|
|
|
|
|
|
||
Notes payable and current maturities of long-term debt
|
$
|
284,630
|
|
|
$
|
581,102
|
|
Accounts payable
|
938,425
|
|
|
882,007
|
|
||
Accrued compensation and employee benefits
|
183,396
|
|
|
228,118
|
|
||
Accrued insurance
|
100,721
|
|
|
101,619
|
|
||
Other accrued expenses
|
295,038
|
|
|
334,435
|
|
||
Federal and other income taxes
|
11,717
|
|
|
14,697
|
|
||
Total current liabilities
|
1,813,927
|
|
|
2,141,978
|
|
||
Long-term debt
|
2,974,940
|
|
|
2,986,702
|
|
||
Deferred income taxes
|
336,147
|
|
|
348,201
|
|
||
Noncurrent income tax payable
|
98,954
|
|
|
108,497
|
|
||
Other liabilities
|
408,611
|
|
|
425,548
|
|
||
Liabilities of discontinued operations
|
—
|
|
|
264,253
|
|
||
Stockholders' equity:
|
|
|
|
|
|
||
Total stockholders' equity
|
2,840,591
|
|
|
4,383,180
|
|
||
Total liabilities and stockholders' equity
|
$
|
8,473,170
|
|
|
$
|
10,658,359
|
|
|
Common stock $1 par value
|
|
Additional paid-in capital
|
|
Treasury stock
|
|
Retained earnings
|
|
Accumulated other comprehensive (loss) earnings
|
|
Total stockholders' equity
|
||||||||||||
Balance at December 31, 2017
|
$
|
256,992
|
|
|
$
|
942,485
|
|
|
$
|
(5,077,039
|
)
|
|
$
|
8,455,501
|
|
|
$
|
(194,759
|
)
|
|
$
|
4,383,180
|
|
Adoption of ASU 2018-02
(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
12,856
|
|
|
(12,856
|
)
|
|
—
|
|
||||||
Cumulative catch-up adjustment related to Adoption of Topic 606
(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
175
|
|
|
—
|
|
|
175
|
|
||||||
Net earnings
|
—
|
|
|
—
|
|
|
—
|
|
|
271,393
|
|
|
—
|
|
|
271,393
|
|
||||||
Dividends paid
|
—
|
|
|
—
|
|
|
—
|
|
|
(142,322
|
)
|
|
—
|
|
|
(142,322
|
)
|
||||||
Separation of Apergy
|
—
|
|
|
—
|
|
|
—
|
|
|
(939,743
|
)
|
|
32,928
|
|
|
(906,815
|
)
|
||||||
Common stock issued for the exercise of share-based awards
|
402
|
|
|
(21,604
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,202
|
)
|
||||||
Stock-based compensation expense
|
—
|
|
|
11,147
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,147
|
|
||||||
Common stock acquired, including accelerated share repurchase program
|
—
|
|
|
(140,000
|
)
|
|
(604,977
|
)
|
|
—
|
|
|
—
|
|
|
(744,977
|
)
|
||||||
Other comprehensive (loss), net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,092
|
)
|
|
(5,092
|
)
|
||||||
Other, net
|
—
|
|
|
(4,896
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,896
|
)
|
||||||
Balance at June 30, 2018
|
$
|
257,394
|
|
|
$
|
787,132
|
|
|
$
|
(5,682,016
|
)
|
|
$
|
7,657,860
|
|
|
$
|
(179,779
|
)
|
|
$
|
2,840,591
|
|
|
Six Months Ended June 30,
|
||||||
|
2018
|
|
2017
|
||||
Operating Activities:
|
|
|
|
||||
Net earnings
|
$
|
271,393
|
|
|
$
|
336,305
|
|
Adjustments to reconcile net earnings to cash from operating activities:
|
|
|
|
||||
Loss (earnings) from discontinued operations, net
|
4,472
|
|
|
(38,742
|
)
|
||
Depreciation and amortization
|
137,928
|
|
|
139,628
|
|
||
Stock-based compensation expense
|
10,403
|
|
|
16,861
|
|
||
Gain on sale of businesses
|
—
|
|
|
(90,093
|
)
|
||
Cash effect of changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
(108,003
|
)
|
|
(62,209
|
)
|
||
Inventories
|
(85,340
|
)
|
|
(80,444
|
)
|
||
Prepaid expenses and other assets
|
(32,336
|
)
|
|
(3,641
|
)
|
||
Accounts payable
|
64,592
|
|
|
72,454
|
|
||
Accrued compensation and employee benefits
|
(51,002
|
)
|
|
(21,725
|
)
|
||
Accrued expenses and other liabilities
|
(32,894
|
)
|
|
(39,519
|
)
|
||
Accrued and deferred taxes, net
|
2,075
|
|
|
(22,709
|
)
|
||
Other, net
|
(6,548
|
)
|
|
(7,934
|
)
|
||
Net cash provided by operating activities
|
174,740
|
|
|
198,232
|
|
||
Investing Activities:
|
|
|
|
|
|
||
Additions to property, plant and equipment
|
(96,364
|
)
|
|
(78,966
|
)
|
||
Acquisitions, net of cash and cash equivalents acquired
|
(68,557
|
)
|
|
(25,568
|
)
|
||
Proceeds from sale of property, plant and equipment
|
2,411
|
|
|
2,177
|
|
||
Proceeds from sale of businesses
|
2,069
|
|
|
121,175
|
|
||
Other
|
(13,762
|
)
|
|
21,151
|
|
||
Net cash (used in) provided by investing activities
|
(174,203
|
)
|
|
39,969
|
|
||
Financing Activities:
|
|
|
|
|
|
||
Cash received from Apergy, net of cash distributed
|
689,643
|
|
|
—
|
|
||
Repurchase of common stock, including prepayment under an accelerated share repurchase program
|
(744,977
|
)
|
|
—
|
|
||
Change in commercial paper and notes payable
|
53,584
|
|
|
(157,444
|
)
|
||
Dividends paid to stockholders
|
(142,322
|
)
|
|
(137,182
|
)
|
||
Payments to settle employee tax obligations on exercise of share-based awards
|
(21,202
|
)
|
|
(12,028
|
)
|
||
Repayment of long-term debt
|
(350,000
|
)
|
|
—
|
|
||
Other
|
(1,563
|
)
|
|
(2,912
|
)
|
||
Net cash used in financing activities
|
(516,837
|
)
|
|
(309,566
|
)
|
||
Cash Flows from Discontinued Operations
|
|
|
|
|
|
||
Net cash provided by operating activities of discontinued operations
|
19,336
|
|
|
40,163
|
|
||
Net cash used in investing activities of discontinued operations
|
(23,705
|
)
|
|
(13,592
|
)
|
||
Net cash (used in) provided by discontinued operations
|
(4,369
|
)
|
|
26,571
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
9,519
|
|
|
(2,764
|
)
|
||
Net decrease in cash and cash equivalents
|
(511,150
|
)
|
|
(47,558
|
)
|
||
Cash and cash equivalents at beginning of period
|
753,964
|
|
|
349,146
|
|
||
Cash and cash equivalents at end of period
|
$
|
242,814
|
|
|
$
|
301,588
|
|
Assets:
|
|
|
||
Cash and cash equivalents
|
|
$
|
10,357
|
|
Current assets
|
|
462,620
|
|
|
Non-current assets
|
|
1,438,760
|
|
|
|
|
$
|
1,911,737
|
|
Liabilities:
|
|
|
||
Current liabilities
|
|
$
|
185,354
|
|
Non-current liabilities
|
|
119,568
|
|
|
|
|
$
|
304,922
|
|
|
|
|
||
Net assets distributed to Apergy Corporation
|
|
$
|
1,606,815
|
|
Less: Cash received from Apergy Corporation
|
|
700,000
|
|
|
Net distribution to Apergy Corporation
|
|
$
|
906,815
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||
|
2018
|
|
2018
|
||||
Printing & Identification
|
$
|
299,834
|
|
|
$
|
582,356
|
|
Industrials
|
403,155
|
|
|
792,259
|
|
||
Total Engineered Systems segment
|
702,989
|
|
|
1,374,615
|
|
||
Fueling & Transport
|
363,355
|
|
|
682,659
|
|
||
Pumps
|
173,306
|
|
|
335,615
|
|
||
Process Solutions
|
157,005
|
|
|
303,490
|
|
||
Total Fluids segment
|
693,666
|
|
|
1,321,764
|
|
||
Refrigeration
|
330,232
|
|
|
608,887
|
|
||
Food Equipment
|
71,534
|
|
|
131,114
|
|
||
Total Refrigeration & Food Equipment segment
|
401,766
|
|
|
740,001
|
|
||
Intra-segment eliminations
|
(327
|
)
|
|
(615
|
)
|
||
Total Consolidated Revenue
|
$
|
1,798,094
|
|
|
$
|
3,435,765
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||
|
2018
|
|
2018
|
||||
United States
|
$
|
932,207
|
|
|
$
|
1,785,209
|
|
Europe
|
402,234
|
|
|
789,412
|
|
||
Asia
|
219,032
|
|
|
413,635
|
|
||
Other Americas
|
168,197
|
|
|
301,341
|
|
||
Other
|
76,424
|
|
|
146,168
|
|
||
Total
|
$
|
1,798,094
|
|
|
$
|
3,435,765
|
|
|
June 30, 2018
|
|
At Adoption
|
||||
Contract assets
|
$
|
13,803
|
|
|
$
|
11,932
|
|
Contract liabilities - current
|
44,992
|
|
|
48,268
|
|
||
Contract liabilities - non-current
|
10,305
|
|
|
9,916
|
|
|
Contract Assets
|
||
Opening balance at January 1, 2018
|
$
|
11,932
|
|
Cumulative catch-up adjustment upon transition
|
356
|
|
|
Changes in the estimate of the stage of completion
|
7,211
|
|
|
Transferred to receivables from contract assets recognized during the period
|
(5,618
|
)
|
|
Other
|
(78
|
)
|
|
Closing balance at June 30, 2018
|
$
|
13,803
|
|
|
Contract Liabilities
|
||
Opening balance at January 1, 2018
|
$
|
58,184
|
|
Cumulative catch-up adjustment upon transition
|
—
|
|
|
Revenue recognized that was included in the contract liability balance at the beginning of the period
|
(39,484
|
)
|
|
Increases due to cash received, excluding amounts recognized as revenue during the period
|
36,271
|
|
|
Other
|
326
|
|
|
Closing balance at June 30, 2018
|
$
|
55,297
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
As reported
|
$
|
1,798,094
|
|
|
$
|
1,737,371
|
|
|
$
|
3,435,765
|
|
|
$
|
3,320,581
|
|
Pro forma
|
1,798,094
|
|
|
1,746,950
|
|
|
3,436,081
|
|
|
3,342,851
|
|
||||
Earnings:
|
|
|
|
|
|||||||||||
As reported
|
$
|
166,456
|
|
|
$
|
142,475
|
|
|
$
|
275,865
|
|
|
$
|
297,563
|
|
Pro forma
|
168,158
|
|
|
142,167
|
|
|
279,714
|
|
|
296,459
|
|
||||
Basic earnings per share:
|
|
|
|
|
|||||||||||
As reported
|
$
|
1.10
|
|
|
$
|
0.92
|
|
|
$
|
1.80
|
|
|
$
|
1.91
|
|
Pro forma
|
1.11
|
|
|
0.91
|
|
|
1.83
|
|
|
1.90
|
|
||||
Diluted earnings per share:
|
|
|
|
|
|||||||||||
As reported
|
$
|
1.08
|
|
|
$
|
0.90
|
|
|
$
|
1.77
|
|
|
$
|
1.89
|
|
Pro forma
|
1.09
|
|
|
0.90
|
|
|
1.80
|
|
|
1.88
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue
|
$
|
119,647
|
|
|
$
|
256,156
|
|
|
$
|
403,688
|
|
|
$
|
486,430
|
|
Cost of goods and services
|
76,277
|
|
|
160,817
|
|
|
254,205
|
|
|
305,771
|
|
||||
Gross profit
|
43,370
|
|
|
95,339
|
|
|
149,483
|
|
|
180,659
|
|
||||
Selling, general and administrative expenses
|
64,990
|
|
|
62,773
|
|
|
144,114
|
|
|
122,347
|
|
||||
Operating (loss) earnings
|
(21,620
|
)
|
|
32,566
|
|
|
5,369
|
|
|
58,312
|
|
||||
Other (income) expense, net
|
(134
|
)
|
|
(165
|
)
|
|
349
|
|
|
484
|
|
||||
(Loss) earnings from discontinued operations before taxes
|
(21,486
|
)
|
|
32,731
|
|
|
5,020
|
|
|
57,828
|
|
||||
Provision for income taxes
|
5,011
|
|
|
11,148
|
|
|
9,492
|
|
|
19,086
|
|
||||
(Loss) earnings from discontinued operations, net of tax
|
$
|
(26,497
|
)
|
|
$
|
21,583
|
|
|
$
|
(4,472
|
)
|
|
$
|
38,742
|
|
|
December 31, 2017
|
||
Assets of Discontinued Operations
|
|
||
Accounts receivable
|
$
|
202,052
|
|
Inventories, net
|
201,591
|
|
|
Prepaid and other current assets
|
14,035
|
|
|
Total current assets
|
417,678
|
|
|
Property, plant and equipment, net
|
211,832
|
|
|
Goodwill and intangible assets, net
|
1,232,843
|
|
|
Other assets and deferred charges
|
3,200
|
|
|
Total assets
|
$
|
1,865,553
|
|
|
|
||
Liabilities of Discontinued Operations
|
|
|
|
Accounts payable
|
$
|
97,439
|
|
Other current liabilities
|
59,482
|
|
|
Total current liabilities
|
156,921
|
|
|
Deferred income taxes
|
90,641
|
|
|
Other liabilities
|
16,691
|
|
|
Total liabilities
|
$
|
264,253
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Raw materials
|
$
|
392,774
|
|
|
$
|
400,009
|
|
Work in progress
|
172,959
|
|
|
128,296
|
|
||
Finished goods
|
307,850
|
|
|
251,402
|
|
||
Subtotal
|
873,583
|
|
|
779,707
|
|
||
Less reserves
|
(109,530
|
)
|
|
(102,664
|
)
|
||
Total
|
$
|
764,053
|
|
|
$
|
677,043
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Land
|
$
|
54,032
|
|
|
$
|
54,918
|
|
Buildings and improvements
|
520,396
|
|
|
517,049
|
|
||
Machinery, equipment and other
|
1,527,842
|
|
|
1,472,852
|
|
||
Property, plant and equipment, gross
|
2,102,270
|
|
|
2,044,819
|
|
||
Total accumulated depreciation
|
(1,297,261
|
)
|
|
(1,256,879
|
)
|
||
Property, plant and equipment, net
|
$
|
805,009
|
|
|
$
|
787,940
|
|
|
Engineered Systems
|
|
Fluids
|
|
Refrigeration & Food Equipment
|
|
Total
|
||||||||
Balance at December 31, 2017
|
$
|
1,645,389
|
|
|
$
|
1,504,284
|
|
|
$
|
536,699
|
|
|
$
|
3,686,372
|
|
Reallocation due to Apergy separation
|
3,546
|
|
|
—
|
|
|
—
|
|
|
3,546
|
|
||||
Acquisitions
|
—
|
|
|
36,070
|
|
|
10,402
|
|
|
46,472
|
|
||||
Purchase price adjustments
|
44
|
|
|
—
|
|
|
—
|
|
|
44
|
|
||||
Foreign currency translation
|
(9,596
|
)
|
|
(10,950
|
)
|
|
(523
|
)
|
|
(21,069
|
)
|
||||
Balance at June 30, 2018
|
$
|
1,639,383
|
|
|
$
|
1,529,404
|
|
|
$
|
546,578
|
|
|
$
|
3,715,365
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net Carrying Amount
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net Carrying Amount
|
||||||||||||
Amortized intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer intangibles
|
$
|
1,413,880
|
|
|
$
|
604,476
|
|
|
$
|
809,404
|
|
|
$
|
1,405,361
|
|
|
$
|
559,447
|
|
|
$
|
845,914
|
|
Trademarks
|
217,126
|
|
|
65,392
|
|
|
151,734
|
|
|
217,621
|
|
|
58,523
|
|
|
159,098
|
|
||||||
Patents
|
145,059
|
|
|
125,950
|
|
|
19,109
|
|
|
145,577
|
|
|
123,135
|
|
|
22,442
|
|
||||||
Unpatented technologies
|
157,161
|
|
|
78,745
|
|
|
78,416
|
|
|
152,913
|
|
|
71,284
|
|
|
81,629
|
|
||||||
Distributor relationships
|
85,145
|
|
|
35,235
|
|
|
49,910
|
|
|
85,794
|
|
|
32,092
|
|
|
53,702
|
|
||||||
Drawings & manuals
|
32,522
|
|
|
22,182
|
|
|
10,340
|
|
|
32,739
|
|
|
20,767
|
|
|
11,972
|
|
||||||
Other
|
28,105
|
|
|
15,152
|
|
|
12,953
|
|
|
23,095
|
|
|
12,028
|
|
|
11,067
|
|
||||||
Total
|
2,078,998
|
|
|
947,132
|
|
|
1,131,866
|
|
|
2,063,100
|
|
|
877,276
|
|
|
1,185,824
|
|
||||||
Unamortized intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trademarks
|
96,739
|
|
|
—
|
|
|
96,739
|
|
|
96,800
|
|
|
—
|
|
|
96,800
|
|
||||||
Total intangible assets, net
|
$
|
2,175,737
|
|
|
$
|
947,132
|
|
|
$
|
1,228,605
|
|
|
$
|
2,159,900
|
|
|
$
|
877,276
|
|
|
$
|
1,282,624
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Engineered Systems
|
$
|
1,860
|
|
|
$
|
756
|
|
|
$
|
3,235
|
|
|
$
|
1,818
|
|
Fluids
|
3,497
|
|
|
1,068
|
|
|
5,548
|
|
|
4,507
|
|
||||
Refrigeration & Food Equipment
|
234
|
|
|
19
|
|
|
146
|
|
|
1,525
|
|
||||
Corporate
|
2,544
|
|
|
—
|
|
|
3,293
|
|
|
—
|
|
||||
Total
|
$
|
8,135
|
|
|
$
|
1,843
|
|
|
$
|
12,222
|
|
|
$
|
7,850
|
|
These amounts are classified in the Condensed Consolidated Statements of Earnings as follows:
|
|||||||||||||||
Cost of goods and services
|
$
|
2,192
|
|
|
$
|
157
|
|
|
$
|
4,399
|
|
|
$
|
4,235
|
|
Selling, general and administrative expenses
|
5,943
|
|
|
1,686
|
|
|
7,823
|
|
|
3,615
|
|
||||
Total
|
$
|
8,135
|
|
|
$
|
1,843
|
|
|
$
|
12,222
|
|
|
$
|
7,850
|
|
•
|
The Engineered Systems segment recorded
$1,860
of restructuring charges related to programs focused on headcount reduction.
|
•
|
The Fluids segment recorded
$3,497
of restructuring charges as a result of programs and projects across the segment, principally related to headcount reductions and facility consolidations, focused on achieving acquisition integration benefits.
|
•
|
Corporate recorded
$2,544
of restructuring charges primarily related to headcount reductions.
|
|
Severance
|
|
Exit
|
|
Total
|
||||||
Balance at December 31, 2017
|
$
|
25,681
|
|
|
$
|
5,591
|
|
|
$
|
31,272
|
|
Restructuring charges
|
8,420
|
|
|
3,802
|
|
|
12,222
|
|
|||
Payments
|
(21,848
|
)
|
|
(5,876
|
)
|
|
(27,724
|
)
|
|||
Other, including foreign currency translation
|
(1,743
|
)
|
|
369
|
|
(1)
|
(1,374
|
)
|
|||
Balance at June 30, 2018
|
$
|
10,510
|
|
|
$
|
3,886
|
|
|
$
|
14,396
|
|
(1)
|
Other activity in exit reserves primarily represents the non-cash write-off of certain long-lived assets and inventory in connection with certain facility closures and product exits.
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Short-term
|
|
|
|
||||
Current portion of long-term debt and short-term borrowings
|
$
|
1,330
|
|
|
$
|
350,402
|
|
Commercial paper
|
283,300
|
|
|
230,700
|
|
||
Notes payable and current maturities of long-term debt
|
$
|
284,630
|
|
|
$
|
581,102
|
|
|
|
|
Carrying amount
(1)
|
||||||||
|
Principal
|
|
June 30, 2018
|
|
December 31, 2017
|
||||||
Long-term
|
|
|
|
|
|
||||||
5.45% 10-year notes due March 15, 2018
|
$
|
350,000
|
|
|
$
|
—
|
|
|
$
|
349,918
|
|
2.125% 7-year notes due December 1, 2020 (euro-denominated)
|
€
|
351,103
|
|
|
349,932
|
|
|
354,349
|
|
||
4.30% 10-year notes due March 1, 2021
|
$
|
450,000
|
|
|
449,016
|
|
|
448,831
|
|
||
3.150% 10-year notes due November 15, 2025
|
$
|
400,000
|
|
|
395,032
|
|
|
394,695
|
|
||
1.25% 10-year notes due November 9, 2026 (euro-denominated)
|
€
|
702,206
|
|
|
692,400
|
|
|
701,058
|
|
||
6.65% 30-year debentures due June 1, 2028
|
$
|
200,000
|
|
|
199,004
|
|
|
198,954
|
|
||
5.375% 30-year debentures due October 15, 2035
|
$
|
300,000
|
|
|
295,686
|
|
|
295,561
|
|
||
6.60% 30-year notes due March 15, 2038
|
$
|
250,000
|
|
|
247,770
|
|
|
247,713
|
|
||
5.375% 30-year notes due March 1, 2041
|
$
|
350,000
|
|
|
343,739
|
|
|
343,600
|
|
||
Other
|
|
|
|
2,361
|
|
|
2,034
|
|
|||
Total long-term debt
|
|
|
|
2,974,940
|
|
|
3,336,713
|
|
|||
Less long-term debt current portion
|
|
|
—
|
|
|
(350,011
|
)
|
||||
Net long-term debt
|
|
|
|
$
|
2,974,940
|
|
|
$
|
2,986,702
|
|
|
Fair Value Asset (Liability)
|
|
|
||||||
|
June 30, 2018
|
|
December 31, 2017
|
|
Balance Sheet Caption
|
||||
Foreign currency forward
|
$
|
4,059
|
|
|
$
|
358
|
|
|
Prepaid / Other current assets
|
Foreign currency forward
|
(1,290
|
)
|
|
(2,243
|
)
|
|
Other accrued expenses
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Gain (loss) on euro-denominated debt
|
$
|
57,998
|
|
|
$
|
(35,318
|
)
|
|
$
|
13,889
|
|
|
$
|
(65,839
|
)
|
Tax (expense) benefit
|
(12,180
|
)
|
|
12,362
|
|
|
(2,917
|
)
|
|
23,044
|
|
||||
Net gain (loss) on net investment hedges, net of tax
|
$
|
45,818
|
|
|
$
|
(22,956
|
)
|
|
$
|
10,972
|
|
|
$
|
(42,795
|
)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
Level 2
|
|
Level 2
|
||||
Assets:
|
|
|
|
||||
Foreign currency cash flow hedges
|
$
|
4,059
|
|
|
$
|
358
|
|
Liabilities:
|
|
|
|
||||
Foreign currency cash flow hedges
|
1,290
|
|
|
2,243
|
|
|
SARs
|
||||||
|
2018
|
|
2017
|
||||
Risk-free interest rate
|
2.58
|
%
|
-
|
2.87%
|
|
1.80
|
%
|
Dividend yield
|
1.99
|
%
|
-
|
2.43%
|
|
2.27
|
%
|
Expected life (years)
|
5.6
|
|
-
|
5.6
|
|
4.6
|
|
Volatility
|
20.95
|
%
|
-
|
21.20%
|
|
21.90
|
%
|
|
|
|
|
|
|
||
Grant price
(1)
|
$79.75
|
-
|
$82.08
|
|
$66.84
|
||
Fair value per share at date of grant
(1)
|
$14.58
|
-
|
$15.41
|
|
$10.65
|
|
Performance shares
|
|||||
|
2018
|
|
2017
|
|||
Fair value per share at date of grant
(1)
|
$79.75
|
-
|
$82.08
|
|
$66.84
|
|
Average attainment rate reflected in expense
|
222.25%
|
|
222.49
|
%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Pre-tax stock-based compensation expense (continuing)
|
$
|
3,658
|
|
|
$
|
4,710
|
|
|
$
|
10,403
|
|
|
$
|
16,861
|
|
Tax benefit
|
(817
|
)
|
|
(1,649
|
)
|
|
(2,313
|
)
|
|
(5,974
|
)
|
||||
Total stock-based compensation expense, net of tax
|
$
|
2,841
|
|
|
$
|
3,061
|
|
|
$
|
8,090
|
|
|
$
|
10,887
|
|
|
2018
|
|
2017
|
||||
Beginning Balance, December 31 of the Prior Year
|
$
|
59,403
|
|
|
$
|
80,331
|
|
Provision for warranties
|
30,603
|
|
|
32,830
|
|
||
Settlements made
|
(34,746
|
)
|
|
(37,623
|
)
|
||
Other adjustments, including acquisitions and currency translation
|
(480
|
)
|
|
178
|
|
||
Ending Balance, June 30
|
$
|
54,780
|
|
|
$
|
75,716
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||||||
|
U.S. Plan
|
|
Non-U.S. Plans
|
|
U.S. Plan
|
|
Non-U.S. Plans
|
||||||||||||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||
Service cost
|
$
|
2,303
|
|
|
$
|
3,021
|
|
|
$
|
1,534
|
|
|
$
|
1,343
|
|
|
$
|
5,287
|
|
|
$
|
6,042
|
|
|
$
|
3,111
|
|
|
$
|
2,660
|
|
Interest cost
|
5,153
|
|
|
5,430
|
|
|
1,343
|
|
|
1,285
|
|
|
10,255
|
|
|
10,859
|
|
|
2,721
|
|
|
2,549
|
|
||||||||
Expected return on plan assets
|
(9,745
|
)
|
|
(9,953
|
)
|
|
(2,037
|
)
|
|
(1,833
|
)
|
|
(19,956
|
)
|
|
(19,906
|
)
|
|
(4,128
|
)
|
|
(3,637
|
)
|
||||||||
Amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Prior service cost (credit)
|
339
|
|
|
106
|
|
|
(111
|
)
|
|
(112
|
)
|
|
426
|
|
|
213
|
|
|
(226
|
)
|
|
(222
|
)
|
||||||||
Recognized actuarial loss
|
870
|
|
|
1,395
|
|
|
782
|
|
|
864
|
|
|
2,801
|
|
|
2,791
|
|
|
1,585
|
|
|
1,705
|
|
||||||||
Transition obligation
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||||||
Net periodic (income) expense
|
$
|
(1,080
|
)
|
|
$
|
(1
|
)
|
|
$
|
1,512
|
|
|
$
|
1,548
|
|
|
$
|
(1,187
|
)
|
|
$
|
(1
|
)
|
|
$
|
3,065
|
|
|
$
|
3,057
|
|
Less: Discontinued operations
|
$
|
273
|
|
|
$
|
846
|
|
|
$
|
73
|
|
|
$
|
203
|
|
|
$
|
950
|
|
|
$
|
1,692
|
|
|
$
|
247
|
|
|
$
|
405
|
|
Net periodic (income) expense - Continuing operations
|
$
|
(1,353
|
)
|
|
$
|
(847
|
)
|
|
$
|
1,439
|
|
|
$
|
1,345
|
|
|
$
|
(2,137
|
)
|
|
$
|
(1,693
|
)
|
|
$
|
2,818
|
|
|
$
|
2,652
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Service cost
|
$
|
660
|
|
|
$
|
618
|
|
|
$
|
1,355
|
|
|
$
|
1,236
|
|
Interest cost
|
808
|
|
|
1,019
|
|
|
1,701
|
|
|
2,038
|
|
||||
Amortization:
|
|
|
|
|
|
|
|
||||||||
Prior service cost
|
1,351
|
|
|
1,103
|
|
|
2,314
|
|
|
2,205
|
|
||||
Recognized actuarial gain
|
(281
|
)
|
|
(298
|
)
|
|
(536
|
)
|
|
(596
|
)
|
||||
Net periodic expense
|
$
|
2,538
|
|
|
$
|
2,442
|
|
|
$
|
4,834
|
|
|
$
|
4,883
|
|
Less: Discontinued operations
|
97
|
|
|
306
|
|
|
351
|
|
|
613
|
|
||||
Net periodic expense - Continuing operations
|
$
|
2,441
|
|
|
$
|
2,136
|
|
|
$
|
4,483
|
|
|
$
|
4,270
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Service cost
|
$
|
7
|
|
|
$
|
8
|
|
|
$
|
15
|
|
|
$
|
17
|
|
Interest cost
|
72
|
|
|
73
|
|
|
145
|
|
|
146
|
|
||||
Amortization:
|
|
|
|
|
|
|
|
||||||||
Prior service cost
|
4
|
|
|
2
|
|
|
7
|
|
|
4
|
|
||||
Recognized actuarial gain
|
(7
|
)
|
|
(40
|
)
|
|
(15
|
)
|
|
(80
|
)
|
||||
Net periodic expense
|
$
|
76
|
|
|
$
|
43
|
|
|
$
|
152
|
|
|
$
|
87
|
|
|
Three Months Ended
|
|
Three Months Ended
|
||||||||||||||||||||
|
June 30, 2018
|
|
June 30, 2017
|
||||||||||||||||||||
|
Pre-tax
|
|
Tax
|
|
Net of tax
|
|
Pre-tax
|
|
Tax
|
|
Net of tax
|
||||||||||||
Foreign currency translation adjustments
|
$
|
(52,979
|
)
|
|
$
|
(12,180
|
)
|
|
$
|
(65,159
|
)
|
|
$
|
13,812
|
|
|
$
|
12,362
|
|
|
$
|
26,174
|
|
Pension and other post-retirement benefit plans
|
2,948
|
|
|
(628
|
)
|
|
2,320
|
|
|
3,021
|
|
|
(966
|
)
|
|
2,055
|
|
||||||
Changes in fair value of cash flow hedges
|
2,085
|
|
|
(437
|
)
|
|
1,648
|
|
|
(2,642
|
)
|
|
925
|
|
|
(1,717
|
)
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
(657
|
)
|
|
79
|
|
|
(578
|
)
|
||||||
Total other comprehensive (loss) earnings
|
$
|
(47,946
|
)
|
|
$
|
(13,245
|
)
|
|
$
|
(61,191
|
)
|
|
$
|
13,534
|
|
|
$
|
12,400
|
|
|
$
|
25,934
|
|
|
Six Months Ended
|
|
Six Months Ended
|
||||||||||||||||||||
|
June 30, 2018
|
|
June 30, 2017
|
||||||||||||||||||||
|
Pre-tax
|
|
Tax
|
|
Net of tax
|
|
Pre-tax
|
|
Tax
|
|
Net of tax
|
||||||||||||
Foreign currency translation adjustments
|
$
|
(9,934
|
)
|
|
$
|
(2,917
|
)
|
|
$
|
(12,851
|
)
|
|
$
|
46,902
|
|
|
$
|
23,044
|
|
|
$
|
69,946
|
|
Pension and other post-retirement benefit plans
|
6,358
|
|
|
(1,356
|
)
|
|
5,002
|
|
|
6,022
|
|
|
(1,927
|
)
|
|
4,095
|
|
||||||
Changes in fair value of cash flow hedges
|
3,490
|
|
|
(733
|
)
|
|
2,757
|
|
|
(2,855
|
)
|
|
999
|
|
|
(1,856
|
)
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
(274
|
)
|
|
33
|
|
|
(241
|
)
|
||||||
Total other comprehensive (loss) earnings
|
$
|
(86
|
)
|
|
$
|
(5,006
|
)
|
|
$
|
(5,092
|
)
|
|
$
|
49,795
|
|
|
$
|
22,149
|
|
|
$
|
71,944
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net earnings
|
$
|
139,959
|
|
|
$
|
164,058
|
|
|
$
|
271,393
|
|
|
$
|
336,305
|
|
Other comprehensive (loss) earnings
|
(61,191
|
)
|
|
25,934
|
|
|
(5,092
|
)
|
|
71,944
|
|
||||
Comprehensive earnings
|
$
|
78,768
|
|
|
$
|
189,992
|
|
|
$
|
266,301
|
|
|
$
|
408,249
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Foreign currency translation:
|
|
|
|
|
|
|
|
||||||||
Reclassification of foreign currency translation losses to earnings from sale of subsidiary
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,875
|
|
Tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net of tax
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,875
|
|
Pension and other postretirement benefit plans:
|
|
|
|
|
|
|
|
||||||||
Amortization of actuarial losses
|
$
|
1,365
|
|
|
$
|
1,922
|
|
|
$
|
3,837
|
|
|
$
|
3,821
|
|
Amortization of prior service costs
|
1,583
|
|
|
1,099
|
|
|
2,521
|
|
|
2,201
|
|
||||
Total before tax
|
2,948
|
|
|
3,021
|
|
|
6,358
|
|
|
6,022
|
|
||||
Tax benefit
|
(628
|
)
|
|
(966
|
)
|
|
(1,356
|
)
|
|
(1,927
|
)
|
||||
Net of tax
|
$
|
2,320
|
|
|
$
|
2,055
|
|
|
$
|
5,002
|
|
|
$
|
4,095
|
|
Cash flow hedges:
|
|
|
|
|
|
|
|
||||||||
Net gains (loss) reclassified into earnings
|
$
|
(579
|
)
|
|
$
|
245
|
|
|
$
|
(899
|
)
|
|
$
|
(89
|
)
|
Tax provision (benefit)
|
122
|
|
|
(86
|
)
|
|
189
|
|
|
31
|
|
||||
Net of tax
|
$
|
(457
|
)
|
|
$
|
159
|
|
|
$
|
(710
|
)
|
|
$
|
(58
|
)
|
•
|
Engineered Systems segment is comprised of two platforms, Printing & Identification and Industrials, and is focused on the design, manufacture and service of critical equipment and components serving the fast-moving consumer goods, digital textile printing, vehicle service, environmental solutions and industrial end markets.
|
•
|
Fluids segment, serving the Fueling & Transport, Pumps and Process Solutions end markets, is focused on the safe handling of critical fluids, and providing critical components to the retail fueling, chemical, hygienic, oil and gas, power generation and industrial markets.
|
•
|
Refrigeration & Food Equipment segment is a provider of innovative and energy efficient equipment and systems serving the commercial refrigeration and food equipment end markets
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Engineered Systems
|
$
|
702,989
|
|
|
$
|
678,285
|
|
|
$
|
1,374,615
|
|
|
$
|
1,307,157
|
|
Fluids
|
693,666
|
|
|
633,252
|
|
|
1,321,764
|
|
|
1,230,897
|
|
||||
Refrigeration & Food Equipment
|
401,766
|
|
|
426,304
|
|
|
740,001
|
|
|
783,138
|
|
||||
Intra-segment eliminations
|
(327
|
)
|
|
(470
|
)
|
|
(615
|
)
|
|
(611
|
)
|
||||
Total consolidated revenue
|
$
|
1,798,094
|
|
|
$
|
1,737,371
|
|
|
$
|
3,435,765
|
|
|
$
|
3,320,581
|
|
Earnings from continuing operations:
|
|
|
|
|
|
|
|
||||||||
Segment earnings:
(1)
|
|
|
|
|
|
|
|
|
|
||||||
Engineered Systems
|
$
|
126,649
|
|
|
$
|
110,103
|
|
|
$
|
228,715
|
|
|
$
|
287,310
|
|
Fluids
|
93,028
|
|
|
91,465
|
|
|
160,376
|
|
|
158,637
|
|
||||
Refrigeration & Food Equipment
|
51,372
|
|
|
65,829
|
|
|
80,554
|
|
|
99,391
|
|
||||
Total segment earnings
|
271,049
|
|
|
267,397
|
|
|
469,645
|
|
|
545,338
|
|
||||
Corporate expense / other
(2)
|
30,050
|
|
|
34,818
|
|
|
60,813
|
|
|
72,100
|
|
||||
Interest expense
|
32,125
|
|
|
36,854
|
|
|
67,765
|
|
|
73,213
|
|
||||
Interest income
|
(2,563
|
)
|
|
(2,335
|
)
|
|
(4,620
|
)
|
|
(4,910
|
)
|
||||
Earnings before provision for income taxes and discontinued operations
|
211,437
|
|
|
198,060
|
|
|
345,687
|
|
|
404,935
|
|
||||
Provision for income taxes
|
44,981
|
|
|
55,585
|
|
|
69,822
|
|
|
107,372
|
|
||||
Earnings from continuing operations
|
$
|
166,456
|
|
|
$
|
142,475
|
|
|
$
|
275,865
|
|
|
$
|
297,563
|
|
(1)
|
Segment earnings includes non-operating income and expense directly attributable to the segments. Non-operating income and expense includes gain on sale of businesses and other expense (income), net.
|
(2)
|
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, shared business services costs and various administrative expenses relating to the corporate headquarters.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Earnings from continuing operations
|
$
|
166,456
|
|
|
$
|
142,475
|
|
|
$
|
275,865
|
|
|
$
|
297,563
|
|
(Loss) earnings from discontinued operations, net
|
(26,497
|
)
|
|
21,583
|
|
|
(4,472
|
)
|
|
38,742
|
|
||||
Net earnings
|
$
|
139,959
|
|
|
$
|
164,058
|
|
|
$
|
271,393
|
|
|
$
|
336,305
|
|
Basic earnings per common share:
|
|
|
|
|
|
|
|
|
|
||||||
Earnings from continuing operations
|
$
|
1.10
|
|
|
$
|
0.92
|
|
|
$
|
1.80
|
|
|
$
|
1.91
|
|
(Loss) earnings from discontinued operations, net
|
$
|
(0.17
|
)
|
|
$
|
0.14
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.25
|
|
Net earnings
|
$
|
0.92
|
|
|
$
|
1.05
|
|
|
$
|
1.77
|
|
|
$
|
2.16
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding
|
151,744,000
|
|
|
155,703,000
|
|
|
153,124,000
|
|
|
155,622,000
|
|
||||
Diluted earnings per common share:
|
|
|
|
|
|
|
|
|
|
||||||
Earnings from continuing operations
|
$
|
1.08
|
|
|
$
|
0.90
|
|
|
$
|
1.77
|
|
|
$
|
1.89
|
|
(Loss) earnings from discontinued operations, net
|
$
|
(0.17
|
)
|
|
$
|
0.14
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.25
|
|
Net earnings
|
$
|
0.91
|
|
|
$
|
1.04
|
|
|
$
|
1.74
|
|
|
$
|
2.14
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding
|
153,938,000
|
|
|
157,513,000
|
|
|
155,573,000
|
|
|
157,457,000
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Weighted average shares outstanding - Basic
|
151,744,000
|
|
|
155,703,000
|
|
|
153,124,000
|
|
|
155,622,000
|
|
Dilutive effect of assumed exercise of SARs and vesting of performance shares and RSUs
|
2,194,000
|
|
|
1,810,000
|
|
|
2,449,000
|
|
|
1,835,000
|
|
Weighted average shares outstanding - Diluted
|
153,938,000
|
|
|
157,513,000
|
|
|
155,573,000
|
|
|
157,457,000
|
|
•
|
Our Engineered Systems segment is comprised of two platforms, Printing & Identification and Industrials, and is focused on the design, manufacture and service of critical equipment and components serving the fast-moving consumer goods, digital textile printing, vehicle service, environmental solutions and industrial end markets.
|
•
|
Our Fluids segment, serving the Fueling & Transport, Pumps and Process Solutions end markets, is focused on the safe handling of critical fluids, and providing critical components to the retail fueling, chemical, hygienic, oil and gas, power generation and industrial markets.
|
•
|
Our Refrigeration & Food Equipment segment is a provider of innovative and energy efficient equipment and systems serving the commercial refrigeration and food equipment end markets.
|
|
Revenue
|
|
Segment Earnings
|
||||||||
|
Three Months Ended June 30,
|
|
Three Months Ended June 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Engineered Systems
|
39.1
|
%
|
|
39.0
|
%
|
|
46.7
|
%
|
|
41.2
|
%
|
Fluids
|
38.6
|
%
|
|
36.5
|
%
|
|
34.3
|
%
|
|
34.2
|
%
|
Refrigeration & Food Equipment
|
22.3
|
%
|
|
24.5
|
%
|
|
19.0
|
%
|
|
24.6
|
%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||
(dollars in thousands, except per share data)
|
2018
|
|
2017
|
|
% Change
|
|
2018
|
|
2017
|
|
% Change
|
||||||||||
Revenue
|
$
|
1,798,094
|
|
|
$
|
1,737,371
|
|
|
3.5
|
%
|
|
$
|
3,435,765
|
|
|
$
|
3,320,581
|
|
|
3.5
|
%
|
Cost of goods and services
|
1,132,858
|
|
|
1,083,263
|
|
|
4.6
|
%
|
|
2,167,700
|
|
|
2,090,620
|
|
|
3.7
|
%
|
||||
Gross profit
|
665,236
|
|
|
654,108
|
|
|
1.7
|
%
|
|
1,268,065
|
|
|
1,229,961
|
|
|
3.1
|
%
|
||||
Gross profit margin
|
37.0
|
%
|
|
37.6
|
%
|
|
(0.6
|
)
|
|
36.9
|
%
|
|
37.0
|
%
|
|
(0.1
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Selling, general and administrative expenses
|
428,775
|
|
|
421,270
|
|
|
1.8
|
%
|
|
863,801
|
|
|
846,987
|
|
|
2.0
|
%
|
||||
Selling, general and administrative expenses as a percent of revenue
|
23.8
|
%
|
|
24.2
|
%
|
|
(0.4
|
)
|
|
25.1
|
%
|
|
25.5
|
%
|
|
(0.4
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
32,125
|
|
|
36,854
|
|
|
(12.8
|
)%
|
|
67,765
|
|
|
73,213
|
|
|
(7.4
|
)%
|
||||
Interest income
|
(2,563
|
)
|
|
(2,335
|
)
|
|
9.8
|
%
|
|
(4,620
|
)
|
|
(4,910
|
)
|
|
(5.9
|
)%
|
||||
Gain on sale of businesses
|
—
|
|
|
—
|
|
|
nm*
|
|
—
|
|
|
(90,093
|
)
|
|
nm*
|
||||||
Other (income) expense, net
|
(4,538
|
)
|
|
259
|
|
|
nm*
|
|
(4,568
|
)
|
|
(171
|
)
|
|
nm*
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for income taxes
|
44,981
|
|
|
55,585
|
|
|
(19.1
|
)%
|
|
69,822
|
|
|
107,372
|
|
|
(35.0
|
)%
|
||||
Effective tax rate
|
21.3
|
%
|
|
28.1
|
%
|
|
(6.8
|
)
|
|
20.2
|
%
|
|
26.5
|
%
|
|
(6.3
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings from continuing operations
|
166,456
|
|
|
142,475
|
|
|
16.8
|
%
|
|
275,865
|
|
|
297,563
|
|
|
(7.3
|
)%
|
||||
(Loss) earnings from discontinued operations, net
|
(26,497
|
)
|
|
21,583
|
|
|
nm*
|
|
(4,472
|
)
|
|
38,742
|
|
|
nm*
|
||||||
Net earnings
|
139,959
|
|
|
164,058
|
|
|
(14.7
|
)%
|
|
271,393
|
|
|
336,305
|
|
|
(19.3
|
)%
|
||||
Earnings from continuing operations per common share - diluted
|
$
|
1.08
|
|
|
$
|
0.90
|
|
|
20.0
|
%
|
|
$
|
1.77
|
|
|
$
|
1.89
|
|
|
(6.3
|
)%
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change
|
|
2018
|
|
2017
|
|
% Change
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Printing & Identification
|
|
$
|
299,834
|
|
|
$
|
278,220
|
|
|
7.8
|
%
|
|
$
|
582,356
|
|
|
$
|
527,458
|
|
|
10.4
|
%
|
Industrials
|
|
403,155
|
|
|
400,065
|
|
|
0.8
|
%
|
|
792,259
|
|
|
779,699
|
|
|
1.6
|
%
|
||||
Total
|
|
$
|
702,989
|
|
|
$
|
678,285
|
|
|
3.6
|
%
|
|
$
|
1,374,615
|
|
|
$
|
1,307,157
|
|
|
5.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment earnings
(1)
|
|
$
|
126,649
|
|
|
$
|
110,103
|
|
|
15.0
|
%
|
|
$
|
228,715
|
|
|
$
|
287,310
|
|
|
(20.4
|
)%
|
Segment margin
(1)
|
|
18.0
|
%
|
|
16.2
|
%
|
|
|
|
16.6
|
%
|
|
22.0
|
%
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment EBITDA
(2)
|
|
$
|
145,852
|
|
|
$
|
131,375
|
|
|
11.0
|
%
|
|
$
|
267,157
|
|
|
$
|
329,180
|
|
|
(18.8
|
)%
|
Segment EBITDA margin
(2)
|
|
20.7
|
%
|
|
19.4
|
%
|
|
|
|
19.4
|
%
|
|
25.2
|
%
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other measures:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
|
$
|
19,203
|
|
|
$
|
21,272
|
|
|
(9.7
|
)%
|
|
$
|
38,442
|
|
|
$
|
41,870
|
|
|
(8.2
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Bookings:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Printing & Identification
|
|
$
|
306,770
|
|
|
$
|
282,158
|
|
|
8.7
|
%
|
|
$
|
591,207
|
|
|
$
|
538,822
|
|
|
9.7
|
%
|
Industrials
|
|
412,780
|
|
|
392,816
|
|
|
5.1
|
%
|
|
879,502
|
|
|
836,874
|
|
|
5.1
|
%
|
||||
|
|
$
|
719,550
|
|
|
$
|
674,974
|
|
|
6.6
|
%
|
|
$
|
1,470,709
|
|
|
$
|
1,375,696
|
|
|
6.9
|
%
|
Backlog:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Printing & Identification
|
|
|
|
|
|
|
|
$
|
137,019
|
|
|
$
|
115,763
|
|
|
18.4
|
%
|
|||||
Industrials
|
|
|
|
|
|
|
|
372,525
|
|
|
321,315
|
|
|
15.9
|
%
|
|||||||
|
|
|
|
|
|
|
|
$
|
509,544
|
|
|
$
|
437,078
|
|
|
16.6
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Components of revenue growth:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Organic growth
|
|
|
|
|
|
5.8
|
%
|
|
|
|
|
|
6.9
|
%
|
||||||||
Acquisitions
|
|
|
|
|
|
—
|
%
|
|
|
|
|
|
0.2
|
%
|
||||||||
Dispositions
|
|
|
|
|
|
(5.0
|
)%
|
|
|
|
|
|
(6.1
|
)%
|
||||||||
Foreign currency translation
|
|
|
|
|
|
2.8
|
%
|
|
|
|
|
|
4.2
|
%
|
||||||||
|
|
|
|
|
|
3.6
|
%
|
|
|
|
|
|
5.2
|
%
|
•
|
Printing & Identification revenue (representing
42.7%
of segment revenue)
increased
$21.6 million
, or
7.8%
, as compared to the prior year quarter. Organic revenue of 4.0%, and a favorable impact from foreign currency translation of 3.8%
|
•
|
Industrials revenue (representing
57.3%
of segment revenue)
increased
$3.1 million
, or
0.8%
, as compared to the prior year quarter. The increase reflects organic revenue growth of 7.0% and a favorable impact of foreign currency translation of 2.1% partially offset by the impact of a 2017 disposition of 8.4%. Organic revenue growth was broad-based, with particular strength in our environmental solutions business.
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change
|
|
2018
|
|
2017
|
|
% Change
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fueling & Transport
|
|
$
|
363,355
|
|
|
$
|
330,027
|
|
|
10.1
|
%
|
|
$
|
682,659
|
|
|
$
|
646,156
|
|
|
5.6
|
%
|
Pumps
|
|
173,306
|
|
|
157,700
|
|
|
9.9
|
%
|
|
335,615
|
|
|
303,309
|
|
|
10.7
|
%
|
||||
Process Solutions
|
|
157,005
|
|
|
145,525
|
|
|
7.9
|
%
|
|
303,490
|
|
|
281,432
|
|
|
7.8
|
%
|
||||
|
|
$
|
693,666
|
|
|
$
|
633,252
|
|
|
9.5
|
%
|
|
$
|
1,321,764
|
|
|
$
|
1,230,897
|
|
|
7.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment earnings
|
|
$
|
93,028
|
|
|
$
|
91,465
|
|
|
1.7
|
%
|
|
$
|
160,376
|
|
|
$
|
158,637
|
|
|
1.1
|
%
|
Segment margin
|
|
13.4
|
%
|
|
14.4
|
%
|
|
|
|
12.1
|
%
|
|
12.9
|
%
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment EBITDA
|
|
$
|
128,009
|
|
|
$
|
124,827
|
|
|
2.5
|
%
|
|
$
|
229,806
|
|
|
$
|
224,453
|
|
|
2.4
|
%
|
Segment EBITDA margin
|
|
18.5
|
%
|
|
19.7
|
%
|
|
|
|
17.4
|
%
|
|
18.2
|
%
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other measures:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
|
$
|
34,981
|
|
|
$
|
33,362
|
|
|
4.9
|
%
|
|
$
|
69,430
|
|
|
$
|
65,816
|
|
|
5.5
|
%
|
Bookings
|
|
737,340
|
|
|
631,350
|
|
|
16.8
|
%
|
|
1,440,801
|
|
|
1,270,151
|
|
|
13.4
|
%
|
||||
Backlog
|
|
|
|
|
|
|
|
564,959
|
|
|
438,445
|
|
|
28.9
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Components of revenue growth:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Organic growth
|
|
|
|
|
|
7.0
|
%
|
|
|
|
|
|
3.7
|
%
|
||||||||
Acquisitions
|
|
|
|
|
|
0.7
|
%
|
|
|
|
|
|
0.7
|
%
|
||||||||
Dispositions
|
|
|
|
|
|
(0.2
|
)%
|
|
|
|
|
|
(0.1
|
)%
|
||||||||
Foreign currency translation
|
|
|
|
|
|
2.0
|
%
|
|
|
|
|
|
3.1
|
%
|
||||||||
|
|
|
|
|
|
9.5
|
%
|
|
|
|
|
|
7.4
|
%
|
•
|
Fueling & Transport revenue (representing
52.4%
of segment revenue)
increased
$33.3 million
, or
10.1%
, as compared to the prior year quarter, primarily driven by the positive impact of foreign currency translation and strong international retail fueling activity, specifically in the Asia Pacific region, which was partially offset by expected lower U.S. based Europay, Mastercard and Visa (EMV) activity driven by the extended compliance date. Transport revenue improved over the prior year and the rail business experienced strong growth, in part, due to recovery from softer volumes in the first quarter.
|
•
|
Pumps revenue (representing
25.0%
of segment revenue)
increased
$15.6 million
, or
9.9%
, as compared to the prior year quarter. This increase reflects growth in the chemical pumps market globally, strong activity in other industrial markets, including our biopharma and medical businesses, and a positive impact of foreign currency translation.
|
•
|
Process Solutions revenue (representing
22.6%
of segment revenue)
increased
$11.5 million
, or
7.9%
, as compared to the prior year quarter. This revenue increase was driven by the acquisition of Ettlinger, strength in our Asia Pacific markets, continued infrastructure spending by our original equipment manufacturer ("OEM") customers, and favorable foreign currency translation.
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||
(dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change
|
|
2018
|
|
2017
|
|
% Change
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Refrigeration
|
|
$
|
330,232
|
|
|
$
|
353,059
|
|
|
(6.5
|
)%
|
|
$
|
608,887
|
|
|
$
|
651,858
|
|
|
(6.6
|
)%
|
Food Equipment
|
|
71,534
|
|
|
73,245
|
|
|
(2.3
|
)%
|
|
131,114
|
|
|
131,280
|
|
|
(0.1
|
)%
|
||||
Total
|
|
$
|
401,766
|
|
|
$
|
426,304
|
|
|
(5.8
|
)%
|
|
$
|
740,001
|
|
|
$
|
783,138
|
|
|
(5.5
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment earnings
|
|
$
|
51,372
|
|
|
$
|
65,829
|
|
|
(22.0
|
)%
|
|
$
|
80,554
|
|
|
$
|
99,391
|
|
|
(19.0
|
)%
|
Segment margin
|
|
12.8
|
%
|
|
15.4
|
%
|
|
|
|
10.9
|
%
|
|
12.7
|
%
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment EBITDA
|
|
$
|
64,896
|
|
|
$
|
80,351
|
|
|
(19.2
|
)%
|
|
$
|
107,657
|
|
|
$
|
128,948
|
|
|
(16.5
|
)%
|
Segment EBITDA margin
|
|
16.2
|
%
|
|
18.8
|
%
|
|
|
|
14.5
|
%
|
|
16.5
|
%
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other measures:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
|
$
|
13,524
|
|
|
$
|
14,522
|
|
|
(6.9
|
)%
|
|
$
|
27,103
|
|
|
$
|
29,557
|
|
|
(8.3
|
)%
|
Bookings
|
|
428,816
|
|
|
466,276
|
|
|
(8.0
|
)%
|
|
801,517
|
|
|
904,852
|
|
|
(11.4
|
)%
|
||||
Backlog
|
|
|
|
|
|
|
|
309,440
|
|
|
382,598
|
|
|
(19.1
|
)%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Components of revenue decline:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Organic decline
|
|
|
|
|
|
(5.6
|
)%
|
|
|
|
|
|
(6.3
|
)%
|
||||||||
Acquisitions
|
|
|
|
|
|
0.7
|
%
|
|
|
|
|
|
0.6
|
%
|
||||||||
Dispositions
|
|
|
|
|
|
(2.2
|
)%
|
|
|
|
|
|
(1.6
|
)%
|
||||||||
Foreign currency translation
|
|
|
|
|
|
1.3
|
%
|
|
|
|
|
|
1.8
|
%
|
||||||||
|
|
|
|
|
|
(5.8
|
)%
|
|
|
|
|
|
(5.5
|
)%
|
•
|
Refrigeration revenue (representing
82.2%
of segment revenue)
decreased
$22.8 million
, or
6.5%
, as compared to the prior year quarter, principally driven by weak capital spending and deferred remodel programs with key U.S. retail refrigeration customers, as well as certain product line exits. The retail refrigeration shortfall was partially offset by strong global demand for heat exchanger products.
|
•
|
Food Equipment revenue (representing
17.8%
of segment revenue)
decreased
$1.7 million
, or
2.3%
, as compared to the prior year quarter, due to project timing in our food service equipment and can shaping businesses, partially offset by the addition of sales from our Rosario acquisition.
|
|
Six Months Ended June 30,
|
||||||
Cash Flows from Continuing Operations
(in thousands)
|
2018
|
|
2017
|
||||
Net Cash Flows Provided By (Used In):
|
|
|
|
||||
Operating activities
|
$
|
174,740
|
|
|
$
|
198,232
|
|
Investing activities
|
(174,203
|
)
|
|
39,969
|
|
||
Financing activities
|
(516,837
|
)
|
|
(309,566
|
)
|
Adjusted Working Capital
(dollars in thousands)
|
June 30, 2018
|
|
December 31, 2017
|
||||
Accounts receivable
|
$
|
1,281,260
|
|
|
$
|
1,183,514
|
|
Inventories
|
764,053
|
|
|
677,043
|
|
||
Less: Accounts payable
|
938,425
|
|
|
882,007
|
|
||
Adjusted working capital
|
$
|
1,106,888
|
|
|
$
|
978,550
|
|
•
|
Acquisitions:
During the
six months
ended
June 30, 2018
, we acquired Ettlinger, within the Fluids segment for $53.2 million, net of cash acquired, and Rosario, within the Refrigeration & Food Equipment segment for
$15.3 million
, net of cash acquired. During the
six months
ended
June 30, 2017
, we acquired Caldera within the Engineered Systems segment for a cash consideration of
$25.6 million
.
|
•
|
Capital spending:
Our capital expenditures
increased
$17.4 million
during the
six months
ended
June 30, 2018
compared to the
six months
ended
June 30, 2017
primarily due to investments in support of increased sales.
|
•
|
Proceeds from sale of businesses:
For the
six months
ended
June 30, 2018
, we received proceeds of
$2.1 million
primarily from the sale of a small business in the fourth quarter of 2017. For the
six months
ended
June 30, 2017
, we generated cash of
$121 million
from the sale of PMI as well as from a working capital adjustment for our sale of Tipper Tie in the fourth quarter of 2016.
|
•
|
Cash received from Apergy, net of cash distributed:
In connection with the separation of Apergy from Dover, Apergy incurred borrowings to fund a one-time cash payment of $700.0 million to Dover in connection with Dover's contribution to Apergy of stock and assets relating to the businesses spun off with Apergy. Dover received net cash of
$689.6 million
upon separation, which reflects
$10.4 million
of cash held by Apergy at the time of distribution and retained by it in in connection with its separation from Dover.
|
•
|
Repurchase of common stock, including prepayment under an accelerated share repurchase program:
During the
six months
ended
June 30, 2018
, we used $45.0 million to repurchase
440,608
shares under the January 2015 authorization, which expired on
January 9, 2018
. There were no repurchases during the
six months
ended
June 30, 2017
under the January 2015 authorization. In February 2018, our Board of Directors approved a new standing share repurchase authorization, whereby we may repurchase up to
20 million
shares of our common stock through December 31, 2020. This share repurchase authorization replaced the January 2015 share repurchase authorization. During the
six months
ended
June 30, 2018
, we used $700 million to repurchase a variable number of shares through an accelerated share repurchase transaction. The Company funded the accelerated share repurchase with funds received from Apergy in connection with the consummation of the Apergy spin-off.
|
•
|
Long-term debt and commercial paper and notes payable:
During the
six months
ended
June 30, 2018
, commercial paper and notes payable increased by
$53.6 million
to partially fund the repayment of the Company's $350.0 million 5.45% notes, which matured on March 15, 2018, offset by a decrease in net borrowings from commercial paper paid down by cash repatriated to the U.S. For the
six months
ended
June 30, 2017
, we repaid
$157.4 million
of commercial paper.
|
•
|
Dividend payments:
Dividends paid to shareholders during the
six months
ended
June 30, 2018
totaled
$142.3 million
as compared to
$137.2 million
during the same period in
2017
. Our dividends paid per common share increased 7.0% to
$0.94
during the
six months
ended
June 30, 2018
compared to
$0.88
during the same period in
2017
.
|
•
|
Payments to settle employee tax obligations:
Payments to settle tax obligations from the exercise of share based awards
increased
$9.2 million
compared to the prior year period. This increase is primarily due to the increased number of shares exercised as well as an increase in the average stock price compared to the prior year period.
|
|
Six Months Ended June 30,
|
||||||
Free Cash Flow
(dollars in thousands)
|
2018
|
|
2017
|
||||
Cash flow provided by operating activities
|
$
|
174,740
|
|
|
$
|
198,232
|
|
Less: Capital expenditures
|
(96,364
|
)
|
|
(78,966
|
)
|
||
Free cash flow
|
$
|
78,376
|
|
|
$
|
119,266
|
|
|
|
|
|
||||
Free cash flow as a percentage of revenue
|
2.3
|
%
|
|
3.6
|
%
|
||
|
|
|
|
||||
Free cash flow as a percentage of earnings from continuing operations
|
28.4
|
%
|
|
40.1
|
%
|
Net Debt to Net Capitalization Ratio
(dollars in thousands)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Current maturities of long-term debt
|
|
$
|
1,330
|
|
|
$
|
350,402
|
|
Commercial paper
|
|
283,300
|
|
|
230,700
|
|
||
Notes payable and current maturities of long-term debt
|
|
284,630
|
|
|
581,102
|
|
||
Long-term debt
|
|
2,974,940
|
|
|
2,986,702
|
|
||
Total debt
|
|
3,259,570
|
|
|
3,567,804
|
|
||
Less: Cash and cash equivalents
|
|
(242,814
|
)
|
|
(753,964
|
)
|
||
Net debt
|
|
3,016,756
|
|
|
2,813,840
|
|
||
Add: Stockholders' equity
|
|
2,840,591
|
|
|
4,383,180
|
|
||
Net capitalization
|
|
$
|
5,857,347
|
|
|
$
|
7,197,020
|
|
Net debt to net capitalization
|
|
51.5
|
%
|
|
39.1
|
%
|
(a)
|
Not applicable.
|
(b)
|
Not applicable.
|
(c)
|
The table below presents shares of Dover stock that we acquired during the quarter.
|
|
|
|
|
|
|
|
Maximum Number of Shares that May Yet Be Purchased under the Plans or Programs
|
||||||
Period
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
(1)
|
|
|
February 2018 Program
(1)
|
|||||
April 1 to April 30
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
|
20,000,000
|
|
May 1 to May 31
|
7,078,751
|
|
|
79.11
|
|
(2)
|
7,078,751
|
|
|
|
12,921,249
|
|
|
June 1 to June 30
|
—
|
|
|
—
|
|
|
—
|
|
|
|
12,921,249
|
|
|
For the Second Quarter
|
7,078,751
|
|
|
$
|
79.11
|
|
|
7,078,751
|
|
|
|
12,921,249
|
|
|
|
DOVER CORPORATION
|
|
|
|
Date:
|
July 19, 2018
|
/s/ Brad M. Cerepak
|
|
|
Brad M. Cerepak
|
|
|
Senior Vice President & Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|
|
|
Date:
|
July 19, 2018
|
/s/ Carrie Anderson
|
|
|
Carrie Anderson
|
|
|
Vice President, Controller
|
|
|
(Principal Accounting Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q 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:
|
July 19, 2018
|
/s/ Brad M. Cerepak
|
|
|
Brad M. Cerepak
|
|
|
Senior Vice President & Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q 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:
|
July 19, 2018
|
/s/ Richard J. Tobin
|
|
|
Richard J. Tobin
|
|
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President and Chief Executive Officer
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(Principal Executive Officer)
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1.
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The Company’s Quarterly Report on Form 10-Q for the period ended
June 30, 2018
(the “Form 10-Q
”
) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and
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2.
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Information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Dated:
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July 19, 2018
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/s/ Richard J. Tobin
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Richard J. Tobin
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President and Chief Executive Officer
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(Principal Executive Officer)
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Dated:
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July 19, 2018
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/s/ Brad M. Cerepak
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Brad M. Cerepak
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Senior Vice President & Chief Financial Officer
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(Principal Financial Officer)
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