ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
OHIO
|
|
34-0451060
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(State or other jurisdiction of
incorporation or organization)
|
|
(IRS Employer
Identification No.)
|
|
|
|
6035 Parkland Blvd., Cleveland, Ohio
|
|
44124-4141
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
|
|
ý
|
|
Accelerated filer
|
|
¨
|
|
|
|
|
|||
Non-accelerated filer
|
|
¨
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
|
|
¨
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net sales
|
$
|
2,828,665
|
|
|
$
|
3,162,311
|
|
|
$
|
8,403,603
|
|
|
$
|
9,567,236
|
|
Cost of sales
|
2,209,401
|
|
|
2,373,016
|
|
|
6,550,929
|
|
|
7,234,465
|
|
||||
Gross profit
|
619,264
|
|
|
789,295
|
|
|
1,852,674
|
|
|
2,332,771
|
|
||||
Selling, general and administrative expenses
|
335,908
|
|
|
372,306
|
|
|
1,020,788
|
|
|
1,152,950
|
|
||||
Interest expense
|
33,745
|
|
|
35,003
|
|
|
103,802
|
|
|
83,609
|
|
||||
Other (income), net
|
(23,382
|
)
|
|
(6,380
|
)
|
|
(50,438
|
)
|
|
(32,055
|
)
|
||||
Income before income taxes
|
272,993
|
|
|
388,366
|
|
|
778,522
|
|
|
1,128,267
|
|
||||
Income taxes
|
85,851
|
|
|
102,904
|
|
|
213,217
|
|
|
295,299
|
|
||||
Net income
|
187,142
|
|
|
285,462
|
|
|
565,305
|
|
|
832,968
|
|
||||
Less: Noncontrolling interest in subsidiaries' earnings
|
58
|
|
|
117
|
|
|
261
|
|
|
282
|
|
||||
Net income attributable to common shareholders
|
$
|
187,084
|
|
|
$
|
285,345
|
|
|
$
|
565,044
|
|
|
$
|
832,686
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share attributable to common shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.39
|
|
|
$
|
2.06
|
|
|
$
|
4.16
|
|
|
$
|
5.77
|
|
Diluted
|
$
|
1.37
|
|
|
$
|
2.02
|
|
|
$
|
4.12
|
|
|
$
|
5.68
|
|
|
|
|
|
|
|
|
|
||||||||
Cash dividends per common share
|
$
|
0.63
|
|
|
$
|
0.63
|
|
|
$
|
1.89
|
|
|
$
|
1.74
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income
|
$
|
187,142
|
|
|
$
|
285,462
|
|
|
$
|
565,305
|
|
|
$
|
832,968
|
|
Less: Noncontrolling interests in subsidiaries' earnings
|
58
|
|
|
117
|
|
|
261
|
|
|
282
|
|
||||
Net income attributable to common shareholders
|
187,084
|
|
|
285,345
|
|
|
565,044
|
|
|
832,686
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustment and other
|
130,766
|
|
|
(373,759
|
)
|
|
(72,592
|
)
|
|
(892,699
|
)
|
||||
Retirement benefits plan activity
|
28,422
|
|
|
25,871
|
|
|
85,539
|
|
|
77,793
|
|
||||
Other comprehensive income (loss)
|
159,188
|
|
|
(347,888
|
)
|
|
12,947
|
|
|
(814,906
|
)
|
||||
Less: Other comprehensive (loss) for noncontrolling interests
|
(2
|
)
|
|
(27
|
)
|
|
(133
|
)
|
|
(180
|
)
|
||||
Other comprehensive income (loss) attributable to common shareholders
|
159,190
|
|
|
(347,861
|
)
|
|
13,080
|
|
|
(814,726
|
)
|
||||
Total comprehensive income (loss) attributable to common shareholders
|
$
|
346,274
|
|
|
$
|
(62,516
|
)
|
|
$
|
578,124
|
|
|
$
|
17,960
|
|
|
(Unaudited)
|
|
|
||||
|
March 31,
2016 |
|
June 30,
2015 |
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,034,971
|
|
|
$
|
1,180,584
|
|
Marketable securities and other investments
|
1,069,658
|
|
|
733,490
|
|
||
Trade accounts receivable, net
|
1,587,785
|
|
|
1,620,194
|
|
||
Non-trade and notes receivable
|
245,248
|
|
|
364,534
|
|
||
Inventories
|
1,248,213
|
|
|
1,300,459
|
|
||
Prepaid expenses
|
124,025
|
|
|
241,684
|
|
||
Deferred income taxes
|
146,939
|
|
|
142,147
|
|
||
Total current assets
|
5,456,839
|
|
|
5,583,092
|
|
||
Plant and equipment
|
4,777,473
|
|
|
4,862,611
|
|
||
Less: Accumulated depreciation
|
3,178,715
|
|
|
3,198,589
|
|
||
|
1,598,758
|
|
|
1,664,022
|
|
||
Other assets
|
1,104,314
|
|
|
1,091,805
|
|
||
Intangible assets, net
|
961,206
|
|
|
1,013,439
|
|
||
Goodwill
|
2,948,284
|
|
|
2,942,679
|
|
||
Total assets
|
$
|
12,069,401
|
|
|
$
|
12,295,037
|
|
LIABILITIES
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Notes payable and long-term debt payable within one year
|
$
|
576,621
|
|
|
$
|
223,142
|
|
Accounts payable, trade
|
999,159
|
|
|
1,092,138
|
|
||
Accrued payrolls and other compensation
|
339,117
|
|
|
409,762
|
|
||
Accrued domestic and foreign taxes
|
123,123
|
|
|
140,295
|
|
||
Other accrued liabilities
|
462,599
|
|
|
484,793
|
|
||
Total current liabilities
|
2,500,619
|
|
|
2,350,130
|
|
||
Long-term debt
|
2,675,000
|
|
|
2,723,960
|
|
||
Pensions and other postretirement benefits
|
1,483,641
|
|
|
1,699,197
|
|
||
Deferred income taxes
|
80,452
|
|
|
77,967
|
|
||
Other liabilities
|
302,706
|
|
|
336,214
|
|
||
Total liabilities
|
7,042,418
|
|
|
7,187,468
|
|
||
EQUITY
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Serial preferred stock, $.50 par value; authorized 3,000,000 shares; none issued
|
—
|
|
|
—
|
|
||
Common stock, $.50 par value; authorized 600,000,000 shares; issued 181,046,128 shares at March 31 and June 30
|
90,523
|
|
|
90,523
|
|
||
Additional capital
|
647,241
|
|
|
622,729
|
|
||
Retained earnings
|
10,148,038
|
|
|
9,841,885
|
|
||
Accumulated other comprehensive (loss)
|
(1,725,538
|
)
|
|
(1,738,618
|
)
|
||
Treasury shares, at cost; 46,364,651 shares at March 31 and 42,487,389 shares at June 30
|
(4,136,652
|
)
|
|
(3,712,232
|
)
|
||
Total shareholders’ equity
|
5,023,612
|
|
|
5,104,287
|
|
||
Noncontrolling interests
|
3,371
|
|
|
3,282
|
|
||
Total equity
|
5,026,983
|
|
|
5,107,569
|
|
||
Total liabilities and equity
|
$
|
12,069,401
|
|
|
$
|
12,295,037
|
|
|
Nine Months Ended
|
||||||
|
March 31,
|
||||||
|
2016
|
|
2015
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
||||
Net income
|
$
|
565,305
|
|
|
$
|
832,968
|
|
Adjustments to reconcile net income to net cash provided by operations:
|
|
|
|
||||
Depreciation
|
143,663
|
|
|
152,884
|
|
||
Amortization
|
88,114
|
|
|
84,348
|
|
||
Share incentive plan compensation
|
53,735
|
|
|
74,830
|
|
||
Deferred income taxes
|
(25,925
|
)
|
|
(29,362
|
)
|
||
Foreign currency transaction loss (gain)
|
25,663
|
|
|
(79,572
|
)
|
||
Loss on sale of plant and equipment
|
76
|
|
|
10,248
|
|
||
Gain on sale of businesses
|
(10,668
|
)
|
|
(4,732
|
)
|
||
Gain on sale of marketable securities
|
(535
|
)
|
|
—
|
|
||
Changes in assets and liabilities, net of effect of acquisitions:
|
|
|
|
||||
Accounts receivable, net
|
21,167
|
|
|
39,309
|
|
||
Inventories
|
53,120
|
|
|
(142,105
|
)
|
||
Prepaid expenses
|
117,203
|
|
|
(64,461
|
)
|
||
Other assets
|
(19,246
|
)
|
|
2,291
|
|
||
Accounts payable, trade
|
(93,948
|
)
|
|
(29,719
|
)
|
||
Accrued payrolls and other compensation
|
(69,179
|
)
|
|
(47,892
|
)
|
||
Accrued domestic and foreign taxes
|
(19,440
|
)
|
|
(68,274
|
)
|
||
Other accrued liabilities
|
(39,595
|
)
|
|
(43,320
|
)
|
||
Pensions and other postretirement benefits
|
(75,540
|
)
|
|
117,097
|
|
||
Other liabilities
|
(32,471
|
)
|
|
(13,488
|
)
|
||
Net cash provided by operating activities
|
681,499
|
|
|
791,050
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
||||
Acquisitions (net of cash of $3,814 in 2016 and $3,979 in 2015)
|
(67,552
|
)
|
|
(18,640
|
)
|
||
Capital expenditures
|
(110,804
|
)
|
|
(157,418
|
)
|
||
Proceeds from sale of plant and equipment
|
14,112
|
|
|
15,525
|
|
||
Proceeds from sale of businesses
|
24,325
|
|
|
35,577
|
|
||
Purchases of marketable securities and other investments
|
(1,188,594
|
)
|
|
(1,456,410
|
)
|
||
Maturities of marketable securities and other investments
|
974,417
|
|
|
828,653
|
|
||
Other
|
(40,364
|
)
|
|
(44,726
|
)
|
||
Net cash (used in) investing activities
|
(394,460
|
)
|
|
(797,439
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
||||
Proceeds from exercise of stock options
|
89
|
|
|
2,828
|
|
||
Payments for common shares
|
(450,070
|
)
|
|
(1,348,446
|
)
|
||
Tax benefit from share incentive plan compensation
|
8,681
|
|
|
19,097
|
|
||
Proceeds from (payments for) notes payable, net
|
523,336
|
|
|
(364,771
|
)
|
||
Proceeds from long-term borrowings
|
2,287
|
|
|
1,482,605
|
|
||
Payments for long-term borrowings
|
(220,068
|
)
|
|
(491
|
)
|
||
Dividends
|
(256,890
|
)
|
|
(252,745
|
)
|
||
Net cash (used in) financing activities
|
(392,635
|
)
|
|
(461,923
|
)
|
||
Effect of exchange rate changes on cash
|
(40,017
|
)
|
|
(128,230
|
)
|
||
Net (decrease) in cash and cash equivalents
|
(145,613
|
)
|
|
(596,542
|
)
|
||
Cash and cash equivalents at beginning of year
|
1,180,584
|
|
|
1,613,555
|
|
||
Cash and cash equivalents at end of period
|
$
|
1,034,971
|
|
|
$
|
1,017,013
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
March 31,
|
|
March 31,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net sales
|
|
|
|
|
|
|
|
|
||||||||
Diversified Industrial:
|
|
|
|
|
|
|
|
|
||||||||
North America
|
|
$
|
1,247,904
|
|
|
$
|
1,441,625
|
|
|
$
|
3,695,008
|
|
|
$
|
4,302,644
|
|
International
|
|
1,019,776
|
|
|
1,148,248
|
|
|
3,050,687
|
|
|
3,599,145
|
|
||||
Aerospace Systems
|
|
560,985
|
|
|
572,438
|
|
|
1,657,908
|
|
|
1,665,447
|
|
||||
Total net sales
|
|
$
|
2,828,665
|
|
|
$
|
3,162,311
|
|
|
$
|
8,403,603
|
|
|
$
|
9,567,236
|
|
Segment operating income
|
|
|
|
|
|
|
|
|
||||||||
Diversified Industrial:
|
|
|
|
|
|
|
|
|
||||||||
North America
|
|
$
|
202,180
|
|
|
$
|
235,516
|
|
|
$
|
568,509
|
|
|
$
|
726,640
|
|
International
|
|
105,161
|
|
|
139,473
|
|
|
329,823
|
|
|
465,803
|
|
||||
Aerospace Systems
|
|
84,238
|
|
|
73,334
|
|
|
240,005
|
|
|
205,500
|
|
||||
Total segment operating income
|
|
391,579
|
|
|
448,323
|
|
|
1,138,337
|
|
|
1,397,943
|
|
||||
Corporate general and administrative expenses
|
|
42,322
|
|
|
45,515
|
|
|
126,583
|
|
|
152,319
|
|
||||
Income before interest expense and other expense
|
|
349,257
|
|
|
402,808
|
|
|
1,011,754
|
|
|
1,245,624
|
|
||||
Interest expense
|
|
33,745
|
|
|
35,003
|
|
|
103,802
|
|
|
83,609
|
|
||||
Other expense (income)
|
|
42,519
|
|
|
(20,561
|
)
|
|
129,430
|
|
|
33,748
|
|
||||
Income before income taxes
|
|
$
|
272,993
|
|
|
$
|
388,366
|
|
|
$
|
778,522
|
|
|
$
|
1,128,267
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
2016
|
|
2015
|
||||||||
Numerator:
|
|
|
|
|
|
|
||||||||
Net income attributable to common shareholders
|
$
|
187,084
|
|
|
$
|
285,345
|
|
$
|
565,044
|
|
|
$
|
832,686
|
|
Denominator:
|
|
|
|
|
|
|
||||||||
Basic - weighted average common shares
|
134,809,610
|
|
|
138,794,789
|
|
135,675,823
|
|
|
144,342,288
|
|
||||
Increase in weighted average common shares from dilutive effect of equity-based awards
|
1,743,159
|
|
|
2,395,014
|
|
1,636,025
|
|
|
2,284,985
|
|
||||
Diluted - weighted average common shares, assuming exercise of equity-based awards
|
136,552,769
|
|
|
141,189,803
|
|
137,311,848
|
|
|
146,627,273
|
|
||||
Basic earnings per share
|
$
|
1.39
|
|
|
$
|
2.06
|
|
$
|
4.16
|
|
|
$
|
5.77
|
|
Diluted earnings per share
|
$
|
1.37
|
|
|
$
|
2.02
|
|
$
|
4.12
|
|
|
$
|
5.68
|
|
|
|
March 31,
2016 |
|
June 30,
2015 |
||||
Notes receivable
|
|
$
|
94,847
|
|
|
$
|
90,470
|
|
Reverse repurchase agreements
|
|
—
|
|
|
113,558
|
|
||
Accounts receivable, other
|
|
150,401
|
|
|
160,506
|
|
||
Total
|
|
$
|
245,248
|
|
|
$
|
364,534
|
|
|
|
March 31,
2016 |
|
June 30,
2015 |
||||
Finished products
|
|
$
|
492,028
|
|
|
$
|
526,708
|
|
Work in process
|
|
672,928
|
|
|
688,727
|
|
||
Raw materials
|
|
83,257
|
|
|
85,024
|
|
||
Total
|
|
$
|
1,248,213
|
|
|
$
|
1,300,459
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Diversified Industrial
|
$
|
24,406
|
|
|
$
|
7,203
|
|
|
$
|
67,405
|
|
|
$
|
22,136
|
|
Aerospace Systems
|
624
|
|
|
563
|
|
|
2,604
|
|
|
563
|
|
||||
Corporate general and administrative expenses
|
2,049
|
|
|
—
|
|
|
2,129
|
|
|
—
|
|
||||
Other expense (income)
|
—
|
|
|
484
|
|
|
116
|
|
|
2,399
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
March 31,
|
|
March 31,
|
||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
Diversified Industrial
|
875
|
|
|
176
|
|
|
2,929
|
|
|
350
|
|
Aerospace Systems
|
15
|
|
|
21
|
|
|
81
|
|
|
21
|
|
Corporate general and administrative expenses
|
50
|
|
|
—
|
|
|
52
|
|
|
—
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Cost of sales
|
$
|
21,628
|
|
|
$
|
4,823
|
|
|
$
|
54,559
|
|
|
$
|
15,430
|
|
Selling, general and administrative expenses
|
5,451
|
|
|
2,943
|
|
|
17,579
|
|
|
7,269
|
|
||||
Other (income), net
|
—
|
|
|
484
|
|
|
116
|
|
|
2,399
|
|
|
Shareholders’
Equity
|
|
Noncontrolling
Interests
|
|
Total Equity
|
||||||
December 31, 2015
|
$
|
4,799,406
|
|
|
$
|
3,315
|
|
|
$
|
4,802,721
|
|
Net income
|
187,084
|
|
|
58
|
|
|
187,142
|
|
|||
Other comprehensive income (loss)
|
159,190
|
|
|
(2
|
)
|
|
159,188
|
|
|||
Dividends paid
|
(85,182
|
)
|
|
—
|
|
|
(85,182
|
)
|
|||
Stock incentive plan activity
|
13,114
|
|
|
—
|
|
|
13,114
|
|
|||
Shares purchased at cost
|
(50,000
|
)
|
|
—
|
|
|
(50,000
|
)
|
|||
Balance at March 31, 2016
|
$
|
5,023,612
|
|
|
$
|
3,371
|
|
|
$
|
5,026,983
|
|
|
|
|
|
|
|
||||||
|
Shareholders’
Equity
|
|
Noncontrolling
Interests
|
|
Total Equity
|
||||||
December 31, 2014
|
$
|
5,756,749
|
|
|
$
|
3,392
|
|
|
$
|
5,760,141
|
|
Net income
|
285,345
|
|
|
117
|
|
|
285,462
|
|
|||
Other comprehensive (loss)
|
(347,861
|
)
|
|
(27
|
)
|
|
(347,888
|
)
|
|||
Dividends paid
|
(87,731
|
)
|
|
(258
|
)
|
|
(87,989
|
)
|
|||
Stock incentive plan activity
|
22,092
|
|
|
—
|
|
|
22,092
|
|
|||
Shares purchased at cost
|
(476,879
|
)
|
|
—
|
|
|
(476,879
|
)
|
|||
Balance at March 31, 2015
|
$
|
5,151,715
|
|
|
$
|
3,224
|
|
|
$
|
5,154,939
|
|
|
Shareholders’
Equity
|
|
Noncontrolling
Interests
|
|
Total Equity
|
||||||
Balance at June 30, 2015
|
$
|
5,104,287
|
|
|
$
|
3,282
|
|
|
$
|
5,107,569
|
|
Net income
|
565,044
|
|
|
261
|
|
|
565,305
|
|
|||
Other comprehensive income (loss)
|
13,080
|
|
|
(133
|
)
|
|
12,947
|
|
|||
Dividends paid
|
(256,851
|
)
|
|
(39
|
)
|
|
(256,890
|
)
|
|||
Stock incentive plan activity
|
48,052
|
|
|
—
|
|
|
48,052
|
|
|||
Shares purchased at cost
|
(450,000
|
)
|
|
—
|
|
|
(450,000
|
)
|
|||
Balance at March 31, 2016
|
$
|
5,023,612
|
|
|
$
|
3,371
|
|
|
$
|
5,026,983
|
|
|
|
|
|
|
|
||||||
|
Shareholders’
Equity
|
|
Noncontrolling
Interests
|
|
Total Equity
|
||||||
Balance at June 30, 2014
|
$
|
6,659,428
|
|
|
$
|
3,380
|
|
|
$
|
6,662,808
|
|
Net income
|
832,686
|
|
|
282
|
|
|
832,968
|
|
|||
Other comprehensive (loss)
|
(814,726
|
)
|
|
(180
|
)
|
|
(814,906
|
)
|
|||
Dividends paid
|
(252,487
|
)
|
|
(258
|
)
|
|
(252,745
|
)
|
|||
Stock incentive plan activity
|
70,392
|
|
|
—
|
|
|
70,392
|
|
|||
Shares purchased at cost
|
(1,343,578
|
)
|
|
—
|
|
|
(1,343,578
|
)
|
|||
Balance at March 31, 2015
|
$
|
5,151,715
|
|
|
$
|
3,224
|
|
|
$
|
5,154,939
|
|
|
Foreign Currency Translation Adjustment and Other
|
|
Retirement Benefit Plans
|
|
Total
|
||||||
Balance at June 30, 2015
|
$
|
(641,018
|
)
|
|
$
|
(1,097,600
|
)
|
|
$
|
(1,738,618
|
)
|
Other comprehensive (loss) before reclassifications
|
(71,989
|
)
|
|
—
|
|
|
(71,989
|
)
|
|||
Amounts reclassified from accumulated other comprehensive (loss)
|
(470
|
)
|
|
85,539
|
|
|
85,069
|
|
|||
Balance at March 31, 2016
|
$
|
(713,477
|
)
|
|
$
|
(1,012,061
|
)
|
|
$
|
(1,725,538
|
)
|
|
Foreign Currency Translation Adjustment and Other
|
|
Retirement Benefit Plans
|
|
Total
|
||||||
Balance at June 30, 2014
|
$
|
124,392
|
|
|
$
|
(947,890
|
)
|
|
$
|
(823,498
|
)
|
Other comprehensive (loss) before reclassifications
|
(892,672
|
)
|
|
—
|
|
|
(892,672
|
)
|
|||
Amounts reclassified from accumulated other comprehensive (loss)
|
153
|
|
|
77,793
|
|
|
77,946
|
|
|||
Balance at March 31, 2015
|
$
|
(768,127
|
)
|
|
$
|
(870,097
|
)
|
|
$
|
(1,638,224
|
)
|
Details about Accumulated Other Comprehensive (Loss) Components
|
|
Income (Expense) Reclassified from Accumulated Other Comprehensive (Loss)
|
|
Consolidated Statement of Income Classification
|
||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
||||
|
|
March 31, 2016
|
|
March 31, 2016
|
|
|
||||
Retirement benefit plans
|
|
|
|
|
|
|
||||
Amortization of prior service cost and initial net obligation
|
|
$
|
(1,842
|
)
|
|
$
|
(5,528
|
)
|
|
See Note 11
|
Recognized actuarial loss
|
|
(42,714
|
)
|
|
(128,538
|
)
|
|
See Note 11
|
||
Total before tax
|
|
(44,556
|
)
|
|
(134,066
|
)
|
|
|
||
Tax benefit
|
|
16,134
|
|
|
48,527
|
|
|
Income taxes
|
||
Net of tax
|
|
$
|
(28,422
|
)
|
|
$
|
(85,539
|
)
|
|
|
Details about Accumulated Other Comprehensive (Loss) Components
|
|
Income (Expense) Reclassified from Accumulated Other Comprehensive (Loss)
|
|
Consolidated Statement of Income Classification
|
||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
||||
|
|
March 31, 2015
|
|
March 31, 2015
|
|
|
||||
Retirement benefit plans
|
|
|
|
|
|
|
||||
Amortization of prior service cost and initial net obligation
|
|
$
|
(2,281
|
)
|
|
$
|
(6,825
|
)
|
|
See Note 11
|
Recognized actuarial loss
|
|
(38,498
|
)
|
|
(115,725
|
)
|
|
See Note 11
|
||
Total before tax
|
|
(40,779
|
)
|
|
(122,550
|
)
|
|
|
||
Tax benefit
|
|
14,908
|
|
|
44,757
|
|
|
Income taxes
|
||
Net of tax
|
|
$
|
(25,871
|
)
|
|
$
|
(77,793
|
)
|
|
|
|
Diversified Industrial
Segment
|
|
Aerospace
Systems
Segment
|
|
Total
|
||||||
Balance at June 30, 2015
|
$
|
2,844,045
|
|
|
$
|
98,634
|
|
|
$
|
2,942,679
|
|
Acquisitions
|
31,134
|
|
|
—
|
|
|
31,134
|
|
|||
Foreign currency translation and other
|
(25,536
|
)
|
|
7
|
|
|
(25,529
|
)
|
|||
Balance at March 31, 2016
|
$
|
2,849,643
|
|
|
$
|
98,641
|
|
|
$
|
2,948,284
|
|
|
March 31, 2016
|
|
June 30, 2015
|
||||||||||||
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Patents
|
$
|
153,034
|
|
|
$
|
94,916
|
|
|
$
|
149,066
|
|
|
$
|
88,540
|
|
Trademarks
|
346,407
|
|
|
178,120
|
|
|
355,108
|
|
|
172,187
|
|
||||
Customer lists and other
|
1,379,694
|
|
|
644,893
|
|
|
1,369,380
|
|
|
599,388
|
|
||||
Total
|
$
|
1,879,135
|
|
|
$
|
917,929
|
|
|
$
|
1,873,554
|
|
|
$
|
860,115
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Service cost
|
$
|
23,680
|
|
|
$
|
24,506
|
|
|
$
|
71,199
|
|
|
$
|
74,163
|
|
Interest cost
|
45,138
|
|
|
44,447
|
|
|
136,872
|
|
|
135,245
|
|
||||
Special termination cost
|
—
|
|
|
—
|
|
|
7,088
|
|
|
—
|
|
||||
Expected return on plan assets
|
(55,418
|
)
|
|
(54,658
|
)
|
|
(166,633
|
)
|
|
(164,847
|
)
|
||||
Amortization of prior service cost
|
1,868
|
|
|
2,306
|
|
|
5,606
|
|
|
6,903
|
|
||||
Amortization of net actuarial loss
|
42,573
|
|
|
38,171
|
|
|
127,841
|
|
|
114,896
|
|
||||
Amortization of initial net obligation
|
4
|
|
|
4
|
|
|
12
|
|
|
13
|
|
||||
Net pension benefit cost
|
$
|
57,845
|
|
|
$
|
54,776
|
|
|
$
|
181,985
|
|
|
$
|
166,373
|
|
|
March 31, 2016
|
|
June 30, 2015
|
||||||||||||
|
Amortized
Cost
|
|
Fair
Value
|
|
Amortized
Cost |
|
Fair
Value |
||||||||
Less than one year
|
$
|
25,405
|
|
|
$
|
25,391
|
|
|
$
|
13,561
|
|
|
$
|
13,555
|
|
One to three years
|
153,513
|
|
|
153,948
|
|
|
188,539
|
|
|
188,057
|
|
||||
Above three years
|
42,944
|
|
|
42,865
|
|
|
15,673
|
|
|
15,587
|
|
|
|
March 31,
2016 |
|
June 30,
2015 |
||||
Carrying value of long-term debt
|
|
$
|
2,728,280
|
|
|
$
|
2,947,102
|
|
Estimated fair value of long-term debt
|
|
2,991,749
|
|
|
3,107,735
|
|
|
|
Balance Sheet Caption
|
|
March 31,
2016 |
|
June 30,
2015 |
||||
Net investment hedges
|
|
|
|
|
|
|
||||
Cross-currency swap contracts
|
|
Other assets
|
|
$
|
14,761
|
|
|
$
|
17,994
|
|
Cash flow hedges
|
|
|
|
|
|
|
||||
Costless collar contracts
|
|
Non-trade and notes receivable
|
|
292
|
|
|
5,627
|
|
||
Costless collar contracts
|
|
Other accrued liabilities
|
|
7,649
|
|
|
1,970
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Cross-currency swap contracts
|
$
|
10,934
|
|
|
$
|
22,684
|
|
|
$
|
3,140
|
|
|
$
|
44,813
|
|
Foreign denominated debt
|
(2,131
|
)
|
|
17,151
|
|
|
2,202
|
|
|
42,296
|
|
|
|
|
|
Quoted Prices
|
|
|
Significant Other
|
|
|
Significant
|
|
|||||
|
|
Fair
|
|
|
In Active
|
|
|
Observable
|
|
|
Unobservable
|
|
||||
|
|
Value at
|
|
|
Markets
|
|
|
Inputs
|
|
|
Inputs
|
|
||||
|
|
March 31, 2016
|
|
|
(Level 1)
|
|
|
(Level 2)
|
|
|
(Level 3)
|
|
||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Equity securities
|
|
$
|
1,452
|
|
|
$
|
1,452
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Government bonds
|
|
25,094
|
|
|
25,094
|
|
|
—
|
|
|
—
|
|
||||
Corporate bonds
|
|
187,946
|
|
|
187,946
|
|
|
—
|
|
|
—
|
|
||||
Asset-backed and mortgage-backed securities
|
|
9,164
|
|
|
—
|
|
|
9,164
|
|
|
—
|
|
||||
Derivatives
|
|
15,231
|
|
|
—
|
|
|
15,231
|
|
|
—
|
|
||||
Investments measured at net asset value
|
|
516,889
|
|
|
|
|
|
|
|
|||||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
15,028
|
|
|
—
|
|
|
15,028
|
|
|
—
|
|
|
|
|
|
Quoted Prices
|
|
|
Significant Other
|
|
|
Significant
|
|
|||||
|
|
Fair
|
|
|
In Active
|
|
|
Observable
|
|
|
Unobservable
|
|
||||
|
|
Value at
|
|
|
Markets
|
|
|
Inputs
|
|
|
Inputs
|
|
||||
|
|
June 30, 2015
|
|
|
(Level 1)
|
|
|
(Level 2)
|
|
|
(Level 3)
|
|
||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Government bonds
|
|
$
|
60,512
|
|
|
$
|
60,512
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Corporate bonds
|
|
145,717
|
|
|
145,717
|
|
|
—
|
|
|
—
|
|
||||
Asset-backed and mortgage-backed securities
|
|
10,970
|
|
|
—
|
|
|
10,970
|
|
|
—
|
|
||||
Derivatives
|
|
23,598
|
|
|
—
|
|
|
23,598
|
|
|
—
|
|
||||
Investments measured at net asset value
|
|
187,534
|
|
|
|
|
|
|
|
|||||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
1,970
|
|
|
—
|
|
|
1,970
|
|
|
—
|
|
•
|
Purchasing Managers Index (PMI) on manufacturing activity specific to regions around the world with respect to most mobile and industrial markets;
|
•
|
Global aircraft miles flown and global revenue passenger miles for commercial aerospace markets and Department of Defense spending for military aerospace markets; and
|
•
|
Housing starts with respect to the North American residential air conditioning market and certain mobile construction markets.
|
|
March 31, 2016
|
|
|
December 31, 2015
|
|
|
June 30, 2015
|
|
United States
|
51.8
|
|
|
48.0
|
|
|
53.5
|
|
Eurozone countries
|
51.6
|
|
|
53.2
|
|
|
52.5
|
|
China
|
49.7
|
|
|
48.2
|
|
|
49.4
|
|
Brazil
|
46.0
|
|
|
45.6
|
|
|
46.5
|
|
•
|
Successfully executing its Win Strategy initiatives relating to engaged people, premier customer experience, profitable growth and financial performance;
|
•
|
Successfully executing its Simplification initiative which is aimed at reducing organizational and process complexity;
|
•
|
Serving the customer and continuously enhancing its experience with the Company;
|
•
|
Maintaining its decentralized division and sales company structure;
|
•
|
Fostering a safety first and entrepreneurial culture;
|
•
|
Engineering innovative systems and products to provide superior customer value through improved service, efficiency and productivity;
|
•
|
Delivering products, systems and services that have demonstrable savings to customers and are priced by the value they deliver;
|
•
|
Acquiring strategic businesses;
|
•
|
Organizing around targeted regions, technologies and markets;
|
•
|
Driving efficiency by implementing lean enterprise principles; and
|
•
|
Creating a culture of empowerment through its values, inclusion and diversity, accountability and teamwork.
|
|
|
Three Months Ended
March 31,
|
Nine Months Ended
March 31,
|
||||||||||||
(dollars in millions)
|
|
2016
|
|
2015
|
2016
|
|
2015
|
||||||||
Net sales
|
|
$
|
2,828.7
|
|
|
$
|
3,162.3
|
|
$
|
8,403.6
|
|
|
$
|
9,567.2
|
|
Gross profit
|
|
$
|
619.3
|
|
|
$
|
789.3
|
|
$
|
1,852.7
|
|
|
$
|
2,332.8
|
|
Gross profit margin
|
|
21.9
|
%
|
|
25.0
|
%
|
22.0
|
%
|
|
24.4
|
%
|
||||
Selling, general and administrative expenses
|
|
$
|
335.9
|
|
|
$
|
372.3
|
|
$
|
1,020.8
|
|
|
$
|
1,153.0
|
|
Selling, general and administrative expenses, as a percent of sales
|
|
11.9
|
%
|
|
11.8
|
%
|
12.1
|
%
|
|
12.1
|
%
|
||||
Interest expense
|
|
$
|
33.7
|
|
|
$
|
35.0
|
|
$
|
103.8
|
|
|
$
|
83.6
|
|
Other (income), net
|
|
$
|
(23.4
|
)
|
|
$
|
(6.4
|
)
|
$
|
(50.4
|
)
|
|
$
|
(32.1
|
)
|
Effective tax rate
|
|
31.4
|
%
|
|
26.5
|
%
|
27.4
|
%
|
|
26.2
|
%
|
||||
Net income
|
|
$
|
187.1
|
|
|
$
|
285.5
|
|
$
|
565.3
|
|
|
$
|
833.0
|
|
Net income, as a percent of sales
|
|
6.6
|
%
|
|
9.0
|
%
|
6.7
|
%
|
|
8.7
|
%
|
|
|
Three Months Ended
March 31, |
|
Nine Months Ended
March 31,
|
||||||||||||
(dollars in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net sales
|
|
|
|
|
|
|
|
|
||||||||
North America
|
|
$
|
1,247.9
|
|
|
$
|
1,441.6
|
|
|
$
|
3,695.0
|
|
|
$
|
4,302.6
|
|
International
|
|
1,019.8
|
|
|
1,148.2
|
|
|
3,050.7
|
|
|
3,599.1
|
|
||||
Operating income
|
|
|
|
|
|
|
|
|
||||||||
North America
|
|
202.2
|
|
|
235.5
|
|
|
568.5
|
|
|
726.6
|
|
||||
International
|
|
$
|
105.2
|
|
|
$
|
139.5
|
|
|
$
|
329.8
|
|
|
$
|
465.8
|
|
Operating margin
|
|
|
|
|
|
|
|
|
||||||||
North America
|
|
16.2
|
%
|
|
16.3
|
%
|
|
15.4
|
%
|
|
16.9
|
%
|
||||
International
|
|
10.3
|
%
|
|
12.1
|
%
|
|
10.8
|
%
|
|
12.9
|
%
|
||||
Backlog
|
|
$
|
1,518.6
|
|
|
$
|
1,662.9
|
|
|
$
|
1,518.6
|
|
|
$
|
1,662.9
|
|
|
|
Period Ending March 31,
|
||||
|
|
Three Months
|
|
Nine Months
|
||
Diversified Industrial North America – as reported
|
|
(13.4
|
)%
|
|
(14.1
|
)%
|
Acquisitions
|
|
0.1
|
%
|
|
0.2
|
%
|
Currency
|
|
(0.8
|
)%
|
|
(1.2
|
)%
|
Diversified Industrial North America – without acquisitions and currency
|
|
(12.7
|
)%
|
|
(13.1
|
)%
|
|
|
|
|
|
||
Diversified Industrial International – as reported
|
|
(11.2
|
)%
|
|
(15.2
|
)%
|
Acquisitions
|
|
0.6
|
%
|
|
0.7
|
%
|
Currency
|
|
(3.1
|
)%
|
|
(8.8
|
)%
|
Diversified Industrial International – without acquisitions and currency
|
|
(8.7
|
)%
|
|
(7.1
|
)%
|
|
|
|
|
|
||
Total Diversified Industrial Segment – as reported
|
|
(12.4
|
)%
|
|
(14.6
|
)%
|
Acquisitions
|
|
0.4
|
%
|
|
0.4
|
%
|
Currency
|
|
(1.8
|
)%
|
|
(4.6
|
)%
|
Total Diversified Industrial Segment – without acquisitions and currency
|
|
(11.0
|
)%
|
|
(10.4
|
)%
|
|
|
Three Months Ended
March 31, |
|
Nine Months Ended
March 31, |
||||||||||||
(dollars in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Diversified Industrial North America
|
|
$
|
8.5
|
|
|
$
|
0.7
|
|
|
$
|
25.5
|
|
|
$
|
1.0
|
|
Diversified Industrial International
|
|
15.9
|
|
|
6.5
|
|
|
41.9
|
|
|
21.1
|
|
|
|
Three Months Ended
March 31,
|
|
Nine Months Ended
March 31, |
||||||||||||
(dollars in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net sales
|
|
$
|
561.0
|
|
|
$
|
572.4
|
|
|
$
|
1,657.9
|
|
|
$
|
1,665.4
|
|
Operating income
|
|
$
|
84.2
|
|
|
$
|
73.3
|
|
|
$
|
240.0
|
|
|
$
|
205.5
|
|
Operating margin
|
|
15.0
|
%
|
|
12.8
|
%
|
|
14.5
|
%
|
|
12.3
|
%
|
||||
Backlog
|
|
$
|
1,794.9
|
|
|
$
|
1,848.3
|
|
|
$
|
1,794.9
|
|
|
$
|
1,848.3
|
|
(dollars in millions)
|
|
Three Months Ended
March 31, |
|
Nine Months Ended
March 31, |
||||||||||||
Expense (income)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Foreign currency transaction
|
|
$
|
17.5
|
|
|
$
|
(56.4
|
)
|
|
$
|
25.7
|
|
|
$
|
(79.6
|
)
|
Stock-based compensation
|
|
8.5
|
|
|
9.2
|
|
|
41.2
|
|
|
48.6
|
|
||||
Pensions
|
|
26.8
|
|
|
23.5
|
|
|
83.9
|
|
|
73.0
|
|
||||
Divestitures and asset sales and writedowns
|
|
(9.6
|
)
|
|
0.9
|
|
|
(11.4
|
)
|
|
1.3
|
|
||||
Other items, net
|
|
(0.7
|
)
|
|
2.3
|
|
|
(10.0
|
)
|
|
(9.6
|
)
|
||||
|
|
$
|
42.5
|
|
|
$
|
(20.5
|
)
|
|
$
|
129.4
|
|
|
$
|
33.7
|
|
(dollars in millions)
|
|
March 31,
2016
|
|
June 30,
2015
|
||||
Cash
|
|
$
|
2,104.6
|
|
|
$
|
1,914.1
|
|
Trade accounts receivable, net
|
|
1,587.8
|
|
|
1,620.2
|
|
||
Inventories
|
|
1,248.2
|
|
|
1,300.5
|
|
||
Notes payable and long-term debt payable within one year
|
|
576.6
|
|
|
233.1
|
|
||
Shareholders’ equity
|
|
5,023.6
|
|
|
5,104.3
|
|
||
Working capital
|
|
$
|
2,956.2
|
|
|
$
|
3,233.0
|
|
Current ratio
|
|
2.18
|
|
|
2.38
|
|
|
|
Nine Months Ended
March 31,
|
||||||
(dollars in millions)
|
|
2016
|
|
2015
|
||||
Cash provided by (used in):
|
|
|
|
|
||||
Operating activities
|
|
$
|
681.5
|
|
|
$
|
791.1
|
|
Investing activities
|
|
(394.5
|
)
|
|
(797.4
|
)
|
||
Financing activities
|
|
(392.6
|
)
|
|
(461.9
|
)
|
||
Effect of exchange rates
|
|
(40.0
|
)
|
|
(128.2
|
)
|
||
Net (decrease) in cash and cash equivalents
|
|
$
|
(145.6
|
)
|
|
$
|
(596.4
|
)
|
(dollars in millions)
Debt to Debt-Shareholders’ Equity Ratio
|
|
March 31,
2016
|
|
June 30,
2015
|
||||
Debt
|
|
$
|
3,252
|
|
|
$
|
2,947
|
|
Debt & Shareholders’ equity
|
|
$
|
8,275
|
|
|
$
|
8,051
|
|
Ratio
|
|
39.3
|
%
|
|
36.6
|
%
|
•
|
changes in business relationships with and purchases by or from major customers, suppliers or distributors, including delays or cancellations in shipments, disputes regarding contract terms or significant changes in financial condition, changes in contract cost and revenue estimates for new development programs, and changes in product mix;
|
•
|
uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions;
|
•
|
the ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures;
|
•
|
the determination to undertake business realignment activities and the expected costs thereof and, if undertaken, the ability to complete such activities and realize the anticipated cost savings from such activities;
|
•
|
ability to implement successfully the Company's capital allocation initiatives, including timing, price and execution of share repurchases;
|
•
|
increases in raw material costs that cannot be recovered in product pricing;
|
•
|
the Company’s ability to manage costs related to insurance and employee retirement and health care benefits;
|
•
|
threats associated with and efforts to combat terrorism and cyber-security risks;
|
•
|
uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals;
|
•
|
competitive market conditions and resulting effects on sales and pricing; and
|
•
|
global economic factors, including manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and general economic conditions such as inflation, deflation, interest rates and credit availability.
|
(a)
|
Unregistered Sales of Equity Securities.
Not applicable.
|
(b)
|
Use of Proceeds.
Not applicable.
|
(c)
|
Issuer Purchases of Equity Securities.
|
Period
|
|
(a) Total
Number of
Shares
Purchased
|
|
(b) Average
Price Paid
Per Share
|
|
(c) Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs (1)
|
|
(d) Maximum Number
(or Approximate Dollar
Value) of Shares that
May Yet Be Purchased
Under the Plans or
Programs (1)
|
|||||
January 1, 2016 through January 31, 2016
|
|
170,700
|
|
|
$
|
91.73
|
|
|
170,700
|
|
|
20,603,822
|
|
February 1, 2016 through February 29, 2016
|
|
167,700
|
|
|
$
|
98.24
|
|
|
167,700
|
|
|
20,436,122
|
|
March 1, 2016 through March 31, 2016
|
|
165,913
|
|
|
$
|
107.63
|
|
|
165,913
|
|
|
20,270,209
|
|
Total:
|
|
504,313
|
|
|
$
|
99.12
|
|
|
504,313
|
|
|
20,270,209
|
|
(1)
|
On August 16, 1990, the Company publicly announced that its Board of Directors authorized the repurchase by the Company of up to 3 million shares of its common stock. From time to time thereafter, the Board of Directors has adjusted the overall maximum number of shares authorized for repurchase under this program. On October 22, 2014, the Company publicly announced that the Board of Directors increased the overall maximum number of shares authorized for repurchase under this program so that, beginning on such date, the aggregate number of shares authorized for repurchase was 35 million shares. There is no limitation on the amount of shares that can be repurchased in a fiscal year. There is no expiration date for this program.
|
Exhibit
No.
|
|
Description of Exhibit
|
|
|
|
10(a)
|
|
Parker-Hannifin Corporation Amended and Restated Supplemental Executive Retirement Benefits Program.*
|
|
|
|
12
|
|
Computation of Ratio of Earnings to Fixed Charges as of March 31, 2016.*
|
|
|
|
31(a)
|
|
Certification of the Principal Executive Officer Pursuant to 17 CFR 240.13a-14(a), as Adopted Pursuant to §302 of the Sarbanes-Oxley Act of 2002.*
|
|
|
|
31(b)
|
|
Certification of the Principal Financial Officer Pursuant to 17 CFR 240.13a-14(a), as Adopted Pursuant to §302 of the Sarbanes-Oxley Act of 2002.*
|
|
|
|
32
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to §906 of the Sarbanes-Oxley Act of 2002. *
|
|
|
|
101.INS
|
|
XBRL Instance Document.*
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.*
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.*
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document. *
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.*
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.*
|
*
|
Submitted electronically herewith.
|
|
|
|
PARKER-HANNIFIN CORPORATION
|
|
(Registrant)
|
|
|
|
/s/ Jon. P. Marten
|
|
Jon P. Marten
|
|
Executive Vice President - Finance & Administration and Chief Financial Officer
|
|
|
|
|
|
|
Date: May 5, 2016
|
|
Exhibit
No. |
|
Description of Exhibit
|
|
|
|
10(a)
|
|
Parker-Hannifin Corporation Amended and Restated Supplemental Executive Retirement Benefits Program.*
|
|
|
|
12
|
|
Computation of Ratio of Earnings to Fixed Charges as of March 31, 2016.*
|
|
|
|
31(a)
|
|
Certification of the Principal Executive Officer Pursuant to 17 CFR 240.13a-14(a), as Adopted Pursuant to §302 of the Sarbanes-Oxley Act of 2002.*
|
|
|
|
31(b)
|
|
Certification of the Principal Financial Officer Pursuant to 17 CFR 240.13a-14(a), as Adopted Pursuant to §302 of the Sarbanes-Oxley Act of 2002.*
|
|
|
|
32
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to §906 of the Sarbanes-Oxley Act of 2002. *
|
|
|
|
101.INS
|
|
XBRL Instance Document.*
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.*
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.*
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document. *
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.*
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.*
|
*
|
Submitted electronically herewith.
|
(2)
|
A change in effective control of the Company, which occurs on either of the following dates:
|
(ii)
|
The date that a majority of the Company’s board of directors is replaced during any 12-month period by directors whose appointment or election was not endorsed by a majority of the members of the board prior to the date of such appointment or election.
|
(3)
|
A change in the ownership of a substantial portion of the Company’s assets, which occurs on the date that any one person or more than one person acting as a group (within the meaning of the Regulations under Section 409A of the
|
(ii)
|
an entity 50% or more of the total value or voting power of which is owned, directly or indirectly, by the Company;
|
(iii)
|
a person or group (within the meaning of the Regulations under Section 409A of the Code) that owns, directly or indirectly, 50% or more of the total value or voting power of the stock of the Company; or
|
(iv)
|
an entity, at least 50% of the total value or voting power of which is owned, directly or indirectly by a person or group described in
Section 1(h)(3)(iii)
of this Program.
|
(j)
|
Change in Control Severance Agreement
: The agreement between an Eligible Executive and the Company that provides for certain benefits if the Eligible Executive’s employment terminates following a Corporate Change Vesting Event; provided, that in the case of a former Participant who is receiving benefits under the Program, Change in Control Severance Agreement shall mean the change in control severance agreement that was in effect between the Participant and the Company at the time of his or her retirement.
|
(k)
|
Code
: The Internal Revenue Code of 1986, as amended, or any successor statute, and regulations and guidance issued thereunder.
|
(l)
|
Committee
: The Administrator, the Investment Committee or the Compensation Committee, as applicable.
|
(m)
|
Company
: Parker‑Hannifin Corporation, an Ohio corporation, its corporate successors, and the surviving corporation resulting from any merger of Parker‑Hannifin Corporation with any other corporation or corporations.
|
(n)
|
Company Voting Securities
: Securities of the Company eligible to vote for the election of the Board.
|
(o)
|
Compensation Committee
: The Human Resources and Compensation Committee of the Board.
|
(p)
|
Consolidated Plan
: The Parker-Hannifin Consolidated Pension Plan as it currently exists and as it may subsequently be amended.
|
(q)
|
Contingent Annuitant
: In the event of a Participant's election of an annuity (other than a single life annuity) under
Section 4.02(c)
or the Participant’s deemed election of an annuity under
Section 6.02(a)
, the person designated by such Participant or deemed designated by such Participant as a contingent annuitant.
|
(1)
|
any "person" (as such term is defined in Section 3(a)(9) of the Securities Exchange Act of 1934 (the "Exchange Act") and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
|
(v)
|
as pertains to a Participant, any acquisition by the Participant or any group of persons (within the meaning of Sections 13(d)(3) and 14(d)(2) of the Exchange Act) including the Participant (or any entity in which the Participant or a group of persons including the Participant, directly or indirectly, holds a majority of the voting power of such entity's outstanding voting interests); or
|
(3)
|
the consummation of a Business Combination, unless:
|
(A)
|
more than 50% of the total voting power of the Surviving Corporation resulting from such Business Combination or, if applicable, the Parent Corporation of such Surviving Corporation, is represented by Company Voting Securities that were outstanding immediately prior to the Business Combination (or, if applicable, shares into which such Company Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof is in substantially the same proportion as the voting power of such Company Voting Securities among the holders thereof immediately prior to the Business Combination;
|
(B)
|
no person (other than any employee benefit plan sponsored or maintained by the Surviving Corporation or the Parent Corporation) is or becomes the beneficial owner, directly or indirectly, of 20% or more of the total voting power of the outstanding voting securities eligible to elect directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation); and
|
(C)
|
at least a majority of the members of the board of directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation), following the Business Combination, were members of the Incumbent Board at the time of the Board's approval of the execution of the initial agreement providing for such Business Combination (a "Non-Control Transaction"); or
|
(ii)
|
the Business Combination is effected by means of the acquisition of Company Voting Securities from the Company, and a majority of the Board approves a resolution providing expressly that such Business Combination does not constitute a Corporate Change Vesting Event under this paragraph (3); or
|
(4)
|
the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company or the sale or other disposition of all or substantially all of the assets of the Company and its Subsidiaries.
|
(2)
|
by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under the Executive Long-Term Disability Plan or any other accident and health plan covering employees of the Company.
|
(t)
|
Executive Long-Term Disability Plan
: Parker-Hannifin Corporation Executive Long-Term Disability Plan, as it may be amended from time to time.
|
(u)
|
Highest Average Three‑Year Compensation
: One‑third of the aggregate amount of compensation paid to a Participant from the Affiliated Group during the
three
calendar years of the Participant's employment which were the three highest years of annual compensation, including base salary, bonuses payable under the Company’s Return on Net Assets (RONA) Plan (except to the extent determined by the Compensation Committee to be extraordinary) and Target Incentive Bonus Program, any amounts which would otherwise be paid as compensation during a calendar year but which are deferred by a Participant pursuant to any qualified or nonqualified deferred compensation program sponsored by the Affiliated Group, and any amounts that would otherwise be paid as compensation during a calendar year but which are deferred under Section 125, 127, or 129 of the Code, but excluding:
|
(1)
|
any deferred compensation received during any such year but credited under the Program to the Participant for a prior year;
|
(2)
|
any income realized due to the exercise of stock options or stock appreciation rights;
|
(3)
|
any payments, in cash, deferred or otherwise, payable to the Participant under the Company's Long-Term Incentive bonus program, under any extraordinary bonus arrangements, under any severance agreement (other than as may be required under
Section 4.03(b)
), or as an executive perquisite; and
|
(4)
|
such items as fringe benefits includible in income as compensation for federal tax purposes, moving and educational reimbursement expenses, overseas allowances received by the Participant from the Affiliated Group, and any other irregular payments.
|
(v)
|
Investment Committee
: The Parker Total Rewards Investment Committee of the Company or, if applicable, the investment subcommittee appointed by the Parker Total Rewards Investment Committee with respect to the Program.
|
(w)
|
Life Expectancy
: The expected remaining lifetime (to the nearest integer) based on the Mortality Table and the age at the nearest birthday of the Participant or Recipient at the date the Lump Sum Payment or Change in Control Lump Sum Payment is made (unless otherwise specified herein). If a joint and contingent survivor annuity has been elected, then Life Expectancy shall reflect the joint Life Expectancy of the Participant or Recipient and Contingent Annuitant.
|
(x)
|
Lump Sum Payment
: The Lump Sum Payment provided in
Section 4.02
with the amount determined as set forth in
Section 4.03(a)
.
|
(y)
|
Mortality Table
: For Participants who entered the Program before July 1, 2006 and commenced payment prior to August 12, 2015, eighty percent (80%) of the 1983 Group Annuity Mortality factor (male only); for all other Participants, the “applicable mortality table” prescribed under Section 417(e) of the Code for qualified plans.
|
(aa)
|
Parent Corporation
: The ultimate parent corporation which directly or indirectly has beneficial ownership of 100% of the voting securities eligible to elect directors of a Surviving Corporation.
|
(bb)
|
Participant
: An employee of the Company designated to participate in the Program pursuant to
Article 2
who has timely submitted a Participation Agreement to the Company, while so employed;
provided
,
however
, that any employee of the
|
(cc)
|
Participation Agreement
: An employee's written or electronic agreement to participate in the Program and, to the extent permitted under Section 409A of the Code, initial election of the form of payment of retirement benefits pursuant to
Section 4.02(a)
.
|
(ee)
|
Program
: The Parker-Hannifin Corporation Amended and Restated Supplemental Executive Retirement Benefits Program set forth herein as it may subsequently be amended.
|
(ff)
|
PRP
: The Parker-Hannifin Corporation Amended and Restated Pension Restoration Plan as it currently exists and as it may subsequently be amended.
|
(gg)
|
Qualified Plan Death Benefit
: The death benefit payable to the surviving spouse under the Consolidated Plan (and/or any death benefit payable to a surviving spouse under any other defined benefit arrangement described in
Sections 3.03(c)
,
(d)
, or
(h)
),
multiplied by
a factor equal to 1 plus (0.025 multiplied by each year of Service less than 35 but equal to or greater than 15). Thus, the factor will range from 1.5 at 15 years of Service to 1 at 35 or more years of Service, as illustrated by the following examples:
|
(hh)
|
Recipient
: A retiree, Contingent Annuitant, or Beneficiary, who is currently receiving benefits or is entitled to receive benefits under the Program.
|
(ii)
|
Regulations
: The regulations issued under Section 409A of the Code. Reference to any section of the Regulations shall be read to include any amendment or revision of such Regulation.
|
(jj)
|
RIA Balance
: The total contributions to the Participant’s Retirement Income Account under the Savings Plan (or any successor thereto) and the Participant’s Nonqualified Retirement Income Account under the Parker-Hannifin Corporation Amended and Restated Savings Restoration Plan (or any successor thereto), plus hypothetical earnings/losses calculated as if the accounts had been invested from the time of the
|
(kk)
|
Savings Plan
: The Parker Retirement Savings Plan as it currently exists and as it may subsequently be amended.
|
(ll)
|
Service
: Employment as an employee by any member of the Affiliated Group, as well as employment by a corporation, trade or business, that is now part of the Affiliated Group at a time prior to its becoming part of the Affiliated Group, but in such case only if and to the extent that the Compensation Committee shall so direct at any time prior to retirement. For purposes of determining a Participant’s eligibility to receive a benefit hereunder, Service shall include any additional years credited to a Participant under
Section 2.06
.
|
(nn)
|
Specified Rate
:
|
(oo)
|
Subsidiary
: Any corporation or other entity in which the Company has a direct or indirect ownership interest of 50% or more of the total combined voting power of the then outstanding securities or interests of such corporation or other entity.
|
(qq)
|
Termination of Employment
: A Participant's "separation from service" with the Affiliated Group, within the meaning of Section 1.409A-1(h) of the Regulations; provided, that in applying Section 1.409A-1(h)(ii) of the Regulations, a separation from service shall be deemed to occur if the Company and the Participant reasonably anticipate that the level of bona fide services the Participant will perform for the Affiliated Group after a certain date (whether as an employee or as an independent contractor) will permanently decrease to less than 50% of the average level of bona fide services performed by the Participant for the Affiliated Group (whether as an employee or as an independent contractor) over the immediately preceding 36-month period (or the full period of services performed for the Affiliated Group if the Participant has been providing services to the Affiliated Group for less than 36 months). In the event of a disposition of assets by the Company to an unrelated person, the Administrator reserves the discretion to specify (in accordance with Section 1.409A-1(h)(4) of the Regulations) whether a Participant, who would otherwise experience a separation from service with the Affiliated Group as part of the disposition of assets, will be considered to experience a separation from service for purposes of Section 1.409A-1(h) of the Regulations.
|
(a)
|
such officers and other key executives of the Company as shall be designated as Participants from time to time by the Compensation Committee, and who have submitted to the Company, within 30
days after such designation, a Participation Agreement evidencing agreement to the terms of the Program, including, but not limited to, the non-competition provisions of
Article 7
; and
|
(b)
|
upon a Corporate Change Vesting Event, those individuals who have entered into a Change in Control Severance Agreement with the Company as of the date of such Corporate Change Vesting Event.
|
(a)
|
such Participant (but not a Recipient) shall be treated as having been employed, for purposes of determining age and service under this Program, for the lesser of:
|
(1)
|
the duration of the "Termination Period", if any, under the Participant's Change in Control Severance Agreement; or
|
(2)
|
the period of time remaining until Normal Retirement Date; and
|
(b)
|
such Participant's Highest Average Three-Year Compensation shall be the greater of:
|
(1)
|
the amount that would otherwise be taken into account in determining the Participant's benefit under the Program; or
|
(2)
|
the lump sum severance payment that would be made under Section 2(a)(ii) of the Participant's (but not the Recipient's) Change in Control Severance Agreement (as if he had been terminated immediately following the Corporate Change Vesting Event) divided by the multiple used under such section of the Change in Control Severance Agreement to determine severance pay.
|
(a)
|
who Terminates his or her Employment with the Affiliated Group with the consent of the Compensation Committee after attainment of age 55; or
|
(c)
|
whose Employment with the Affiliated Group is Terminated by the Company for reasons other than for cause (as determined solely by the Compensation Committee) after attainment of age 55 but prior to the expiration of the requisite period of employment established by the Compensation Committee with respect to the Participant pursuant to
Section 2.04
; or
|
(d)
|
who Terminates the Participant's Employment with the Affiliated Group prior to his or her Normal Retirement Date due to Disability or with entitlement to any benefits under the Executive Long-Term Disability Plan; or
|
(e)
|
who Terminates his or her Employment with the Affiliated Group after attainment of age 60 (and after completion of the requisite period of employment established by the Compensation Committee with respect to him or her pursuant to
Section 2.04
) but prior to his or her Normal Retirement Date; shall be eligible for a monthly supplemental retirement benefit as set forth in
Section 3.04
.
|
(a)
|
Initial Election of Payment Form
. To the extent permitted by Section 1.409A-2(a)(5) of the Regulations, within 30 days of the time an individual is designated as a Participant under this Program, he may elect, on his or her initial Participation Agreement, to receive payment of his or her supplemental retirement benefit under this Program in the form of a single Lump Sum Payment, or in the form of a single life annuity. In the event that a Participant fails to make a valid election, the Participant’s supplemental retirement benefit under this Program shall be paid in the form of a single life annuity.
|
(b)
|
One-Time Change by Participant
. In addition to any election pursuant to
Section 4.02(c)
or
4.02(d)
, a Participant shall be allowed a one-time election to change the form of payment of his or her supplemental retirement benefit; provided, however, that:
|
(1)
|
any such election shall not be effective for at least 12 months following the date made; and
|
(2)
|
as a result of any such election, payment shall be delayed for 5 years from the date the payment was scheduled to commence or to be made (taking into account any delay in payment or commencement of payment under
Section 4.01
on account of a Participant's status as a Specified Employee).
|
(c)
|
Changes Between Actuarially Equivalent Forms of Annuity
. A Participant may elect at any time prior to Termination of Employment to convert his or her supplemental retirement benefit payable as an annuity to any of the Actuarially Equivalent forms of annuity offered under the Consolidated Plan.
|
(d)
|
Transitional Rule
. Notwithstanding any other elections under this Program and only to the extent permitted by the Company and transitional rules issued under Section 409A of the Code, through such date as specified by the Committee pursuant to transitional guidance issued under Section 409A of the Code, a Participant may make one or more elections as to time and form of payment of his or her supplemental retirement benefit under this Program, provided that:
|
(1)
|
any such election(s) made during 2006 shall be available only for amounts that are payable after the 2006 calendar year and cannot accelerate any payment into the 2006 calendar year;
|
(2)
|
any such election(s) made during 2007 shall be available only for amounts that are payable after the 2007 calendar year and cannot accelerate any payment into the 2007 calendar year; and
|
(3)
|
any such election(s) made during 2008 shall be available only for amounts that are payable after the 2008 calendar year and cannot accelerate any payment into the 2008 calendar year. Any election(s) must be made by the date specified by the Committee consistent with guidance pursuant to Section 409A of the Code.
|
(e)
|
Payment Upon a Change in Control
. 30 days after a Change in Control, in lieu of any other payments due with respect to benefits earned under the Program to the date of the Change in Control, each Participant and each Recipient shall receive a Change in Control Lump Sum Payment, as calculated under
Section 4.03(b)
.
|
(f)
|
Special Rule Applicable to Specified Employees
. If a Specified Employee dies after Termination of Employment but prior to commencement of benefits, the Specified Employee’s Beneficiary shall receive a payment as of the first of the month following the Specified Employee’s date of death equal to the aggregate of the monthly payments that would have been made to the Specified Employee in accordance with
Section 4.01
but substituting the Specified Employee’s date of death for the actual commencement of payment; provided however that if the Specified Employee’s supplemental retirement benefit is payable in the form of a lump sum, such amount shall be calculated in accordance with
Section 4.03
but substituting the Specified Employee’s date of death for the first day of the seventh month following the Participant’s Termination of Employment. Any additional amounts payable to the Specified Employee’s Beneficiary shall be determined as of the Specified Employee’s date of death in accordance with the form of payment applicable to the Specified Employee as of the Specified Employee’s Termination of Employment.
|
4.03
|
Determination of the Lump Sum Payment
.
|
(a)
|
If the Participant is a Specified Employee immediately prior to Termination of Employment, the Lump Sum Payment referred to in
Section 4.02(a)
shall be equal to the sum of:
|
(1)
|
the aggregate monthly benefits the Participant would have received under the Single Life Annuity form of payment prior to the first day of the seventh month following the Participant's Termination of Employment if the Participant were not a Specified Employee; plus
|
(2)
|
the excess of:
|
(i)
|
the present value (using the Specified Rate and Mortality Table in effect on the first day of the month following the Participant's Termination of Employment), determined as of the first day of the seventh month following the Participant's Termination of Employment, of the monthly benefit determined under
Section 3.03
or
3.04
, as applicable, disregarding
Section 3.03(d)
and the monthly
|
(ii)
|
the sum of:
|
(A)
|
the present value (as defined in the Consolidated Plan) of the "add-on" benefit set forth on Addendum XV of the Consolidated Plan if applicable) included in
Section 3.03(b)
, plus
|
(B)
|
the Actuarial Value of the monthly benefit described in
Section 3.03(d)
, provided that if the Participant's PRP benefit will be paid 5 years later than the Participant's SERP benefit in accordance with Section 3.3(b)(iii) of the PRP, the amount referred to in (B) above shall equal the lump sum Actuarial Value of the monthly benefit described in
Section 3.03(d)
, discounted (using the Specified Rate in effect on the first day of the month following the Participant's Termination of Employment) from the scheduled date of payment of such benefit to the scheduled date of payment of the SERP Lump Sum Payment.
|
(b)
|
The Change in Control Lump Sum Payment referred to in
Section 4.02(e)
shall be equal to the amount determined under
Section 4.03(a)
using the following assumptions:
|
(1)
|
present value is determined using the Specified Rate and Mortality Table;
|
(2)
|
for purposes of determining present value for a Participant who entered the Program before July 1, 2006 and commenced payment prior to August 12, 2015, the Participant (or, if applicable, Recipient) lives the number of years equal to his or her Life Expectancy (calculated as of the date which includes any additional Service credited hereunder);
|
(3)
|
Actuarial Value shall be determined as provided under the PRP; and
|
(4)
|
with respect to any benefit to be deducted as an offset as described in
Section 3.03(b) through (h)
, the Participant terminated employment with the Company on the date of the Change in Control and began to receive such benefits at the earliest date thereafter permitted under the applicable plan, agreement or statute.
|
4.04
|
Certain Matters Following a Lump Sum Payment
.
|
(a)
|
A Participant who has received a Change in Control Lump Sum Payment pursuant to
Section 4.02(e)
shall thereafter:
|
(1)
|
while in the employ of the Company, continue to accrue benefits under the Program; and
|
(2)
|
be eligible for further benefits under
Section 4.01
or
4.02
. The amount of such benefit shall be determined by:
|
(i)
|
calculating the benefit that would be payable to the Participant if there had been no previous Change in Control Lump Sum Payment;
|
(ii)
|
determining the present lump sum value of such benefit, using the Specified Rate and the Mortality Table and, for a Participant who entered the Program before July 1, 2006 and commenced payment prior to August 12, 2015, assuming the Participant lives the number of years equal to his or her Life Expectancy on the date of the Participant's Termination of Employment;
|
(iii)
|
determining the present lump sum value of the Change in Control Lump Sum Payment, assuming the Change in Control Lump Sum Payment had earned interest at the average Specified Rate in effect from the time of payment of the Change in Control Lump Sum Payment until the date of Termination of Employment;
|
(iv)
|
reducing the amount determined in (ii) by the amount determined in (iii); and
|
(v)
|
if applicable, converting the amount determined in (iv) to an Actuarially Equivalent single life only form of payment.
|
(a)
|
The amount of the benefit payable under this
Article 6
to a deceased Participant's Beneficiary shall be equal to the present value (using the Specified Rate and Mortality Table in effect on the first day of the month following the Participant's death) of the total monthly payments the Beneficiary would have received had the Participant retired on the day before his or her death after having effectively elected to receive payment in the form of a Joint and 100% Survivor Annuity under the Program, with his or her Beneficiary as Contingent Annuitant under such option; provided, that:
|
(1)
|
in lieu of the offset for the Participant’s primary Social Security benefit under
Section 3.03(g)
, the benefit to the Beneficiary shall be offset by 50% of the primary or survivor Social Security benefit to which the Beneficiary is entitled at the earliest date as of which such payments become payable; and
|
(2)
|
in lieu of the offset for the Consolidated Plan benefit set forth in
Section 3.03(b)
(and/or any other retirement benefit under any defined benefit arrangement described in
Sections 3.03(c), (d), or (h)
), the benefit to the Beneficiary shall be offset by the Qualified Plan Death Benefit. For purposes
|
(b)
|
If the estate is the death beneficiary as a result of the Participant not having a Beneficiary, the Participant's estate shall receive a lump sum payment equal to the present value (using the Specified Rate and Mortality Table in effect on the first day of the month following the Participant's death) of the total monthly payments that would have been paid to the Participant assuming the Participant had not died but rather:
|
(1)
|
retired on the day before the date of his or her death (or the first day of the month following the time he would have reached age 55, if later);
|
(2)
|
elected a 10-Year Certain Annuity; and
|
(3)
|
received 120 monthly payments. For purposes of this
Section 6.02(b)
, present value for the estate of a deceased Participant who entered the Program before July 1, 2006 and commenced payment prior to August 12, 2015, shall be determined assuming that the Participant had lived the number of years equal to his or her Life Expectancy on the date of his or her death.
|
(c)
|
If the Participant dies before reaching the age that is ten years prior to the Participant’s Normal Retirement Date, then the monthly payments used to determine the death benefit under
Section 6.02(a)
or
Section 6.02(b)
, as applicable, shall be further reduced by .3030 for each month that the Participant’s death preceded his or her Normal Retirement Date.
|
(a)
|
the Secretary of the Company shall have given written notice to the Participant or retiree‑Recipient that, in the opinion of the Compensation Committee, the Participant or retiree-Recipient is engaged in Competition within the meaning of the foregoing provisions of this
Section 7.02
, specifying the details;
|
(b)
|
the Participant or retiree‑Recipient shall have been given a reasonable opportunity, upon receipt of such notice, to appear before and to be heard by the Compensation Committee with respect to his or her views regarding the Compensation Committee’s opinion that the Participant or retiree‑Recipient engaged in Competition;
|
(c)
|
following any hearing pursuant to
Section 7.02(b)
, the Secretary of the Company shall have given written notice to the Participant or retiree‑Recipient that the Compensation Committee determined that the Participant or retiree-Recipient is engaged in Competition; and
|
(d)
|
the Participant or retiree‑Recipient shall neither have ceased to engage in such Competition within thirty days from his or her receipt of notice of such determination nor diligently taken all reasonable steps to that end during such thirty‑day period and thereafter.
|
(a)
|
the specific reasons for such denial;
|
(b)
|
a specific reference to the provisions of the Program on which the denial is based;
|
(c)
|
a description of any additional information or material necessary for the claimant to perfect his or her claim, and a description of why it is needed; and
|
(d)
|
an explanation of the Program's claims review procedure and other appropriate information as to the steps to be taken if the Participant wishes to have the claim reviewed. If the Administrator determines that there are special circumstances requiring additional time to make a decision, the Administrator shall notify the Participant of the special circumstances and the date by which a decision is expected to be made, and may extend the time for up to an additional ninety-day period.
|
(a)
|
no Participant or Recipient shall have any right, title, or interest whatsoever in or to any investments which the Company may make to aid it in meeting its obligations under the Program;
|
(b)
|
nothing contained in the Program shall create or be construed to create a trust of any kind, or a fiduciary relationship between the Company and any Participant, Recipient or any other person;
|
(c)
|
to the extent that any person acquires a right to receive payments from the Company under the Program, such right shall be no greater than the right of an unsecured general creditor of the Company; and
|
(d)
|
all payments to be made under the Program shall be paid from the general funds of the Company and no special or separate fund shall be established and no segregation of assets shall be made to assure payment of amounts payable under the Program.
|
(a)
|
reduce or terminate the benefit of a Participant participating in the Program at the time of any such termination, amendment, or modification;
|
(b)
|
terminate the participation of a Participant participating in the Program at the time of any such termination, amendment, or modification;
|
(c)
|
increase the eligibility requirements applicable to a Participant participating in the Program at the time of any such termination, amendment or modification;
|
(d)
|
terminate the Program, or reduce or terminate any benefit, or terminate the participation or any rights or benefits, after the occurrence of a Corporate Change Vesting Event, with respect to a Participant or Recipient who was a Participant or Recipient, or became a Participant or Recipient, at the time of the occurrence of such Corporate Change Vesting Event; or
|
(e)
|
permit an acceleration of time of payment of a Participant’s benefit under the Program, other than:
|
(1)
|
as necessary to comply with a certificate of divestiture, as defined in Section 1043(b)(2) of the Code;
|
(2)
|
as necessary to pay Federal Insurance Contribution (“FICA”) taxes and any resulting federal, state, local or foreign income taxes attributable to amounts deferred under the Program, subject to the limitations of Section 1.409A-3(j)(4)(vi) of the Regulations;
|
(3)
|
in the event the arrangement fails to meet the requirements of Section 409A of the Code with respect to one or more Participants, and then only in such amount as is included in income of such Participant(s) as a result of such failure;
|
(4)
|
due to a termination of the Program that meets the requirements of Section 1.409A-3(j)(4)(ix) of the Regulations; or
|
(5)
|
as otherwise may be permitted under Section 409A of the Code.
|
|
Nine Months Ended
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
March 31,
|
|
Fiscal Year Ended June 30,
|
||||||||||||||||||||||||
|
2016
|
|
2015
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||||||
EARNINGS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Income from continuing operations before income taxes and noncontrolling interests
|
$
|
778,522
|
|
|
$
|
1,128,267
|
|
|
$
|
1,432,240
|
|
|
$
|
1,556,720
|
|
|
$
|
1,311,001
|
|
|
$
|
1,576,698
|
|
|
$
|
1,413,721
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest on indebtedness, exclusive of interest capitalized
|
101,137
|
|
|
81,219
|
|
|
115,077
|
|
|
79,845
|
|
|
88,668
|
|
|
89,888
|
|
|
97,009
|
|
|||||||
Amortization of deferred loan costs
|
2,665
|
|
|
2,390
|
|
|
3,329
|
|
|
2,721
|
|
|
2,884
|
|
|
2,902
|
|
|
2,695
|
|
|||||||
Portion of rents representative of interest factor
|
31,414
|
|
|
32,987
|
|
|
41,886
|
|
|
43,983
|
|
|
44,493
|
|
|
41,515
|
|
|
39,499
|
|
|||||||
Loss (income) of equity investees
|
(16,666
|
)
|
|
(16,138
|
)
|
|
(23,204
|
)
|
|
(11,141
|
)
|
|
(247
|
)
|
|
1,237
|
|
|
2,592
|
|
|||||||
Amortization of previously capitalized interest
|
119
|
|
|
137
|
|
|
179
|
|
|
190
|
|
|
193
|
|
|
196
|
|
|
226
|
|
|||||||
Income as adjusted
|
$
|
897,191
|
|
|
$
|
1,228,862
|
|
|
$
|
1,569,507
|
|
|
$
|
1,672,318
|
|
|
$
|
1,446,992
|
|
|
$
|
1,712,436
|
|
|
$
|
1,555,742
|
|
FIXED CHARGES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest on indebtedness, exclusive of interest capitalized
|
$
|
101,137
|
|
|
$
|
81,219
|
|
|
$
|
115,077
|
|
|
$
|
79,845
|
|
|
$
|
88,668
|
|
|
$
|
89,888
|
|
|
$
|
97,009
|
|
Amortization of deferred loan costs
|
2,665
|
|
|
2,390
|
|
|
3,329
|
|
|
2,721
|
|
|
2,884
|
|
|
2,902
|
|
|
2,695
|
|
|||||||
Portion of rents representative of interest factor
|
31,414
|
|
|
32,987
|
|
|
41,886
|
|
|
43,983
|
|
|
44,493
|
|
|
41,515
|
|
|
39,499
|
|
|||||||
Fixed charges
|
$
|
135,216
|
|
|
$
|
116,596
|
|
|
$
|
160,292
|
|
|
$
|
126,549
|
|
|
$
|
136,045
|
|
|
$
|
134,305
|
|
|
$
|
139,203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
RATIO OF EARNINGS TO FIXED CHARGES
|
6.64
|
x
|
|
10.54
|
x
|
|
9.79
|
x
|
|
13.21
|
x
|
|
10.64
|
x
|
|
12.75
|
x
|
|
11.18
|
x
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Parker-Hannifin 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(s) 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(s) 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.
|
|
/s/ Thomas L. Williams
|
|
Thomas L. Williams
|
|
Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Parker-Hannifin 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(s) 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(s) 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.
|
|
/s/ Jon P. Marten
|
|
Jon P. Marten
|
|
Executive Vice President - Finance &
|
|
Administration and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
|
|
/s/ Thomas L. Williams
|
|
Name: Thomas L. Williams
|
|
Title: Chief Executive Officer
|
|
|
|
/s/ Jon P. Marten
|
|
Name: Jon P. Marten
|
|
Title: Executive Vice President-Finance &
|
|
Administration and Chief Financial Officer
|