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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



Form 10-Q

(Mark One)    

ý

 

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 28, 2013

or

o

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                             to                              

Commission file number 1-31429



Valmont Industries, Inc.
(Exact name of registrant as specified in its charter)

Delaware
(State or Other Jurisdiction of
Incorporation or Organization)
  47-0351813
(I.R.S. Employer
Identification No.)

One Valmont Plaza,

 

 
Omaha, Nebraska   68154-5215
(Address of Principal Executive Offices)   (Zip Code)

(402) 963-1000
(Registrant's telephone number, including area code)


(Former name, former address and former fiscal year, if changed since last report)



        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes ý    No o

        Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes ý    No o

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ý   Accelerated filer o   Non-accelerated filer o
(Do not check if a smaller
reporting company)
  Smaller reporting company o

        Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes o    No ý

26,786,989
Outstanding shares of common stock as of October 17, 2013

   


Table of Contents

VALMONT INDUSTRIES, INC.
INDEX TO FORM 10-Q

Page No.  

PART I. FINANCIAL INFORMATION

 

Item 1.

 

Financial Statements:

       

 

Condensed Consolidated Statements of Earnings for the thirteen and thirty-nine weeks ended September 28, 2013 and September 29, 2012

    3  

 

Condensed Consolidated Statements of Comprehensive Income for the thirteen and thirty-nine weeks ended September 28, 2013 and September 29, 2012

    4  

 

Condensed Consolidated Balance Sheets as of September 28, 2013 and December 29, 2012

    5  

 

Condensed Consolidated Statements of Cash Flows for the thirty-nine weeks ended September 28, 2013 and September 29, 2012

    6  

 

Condensed Consolidated Statements of Shareholders' Equity for the thirty-nine weeks ended September 28, 2013 and September 29, 2012

    7  

 

Notes to Condensed Consolidated Financial Statements

    8  

Item 2.

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

    31  

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

    40  

Item 4.

 

Controls and Procedures

    40  

PART II. OTHER INFORMATION

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

    41  

Item 6.

 

Exhibits

    41  

Signatures

    42  

2


Table of Contents


VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

PART I. FINANCIAL INFORMATION

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Dollars in thousands, except per share amounts)

(Unaudited)

 
  Thirteen Weeks Ended   Thirty-nine Weeks Ended  
 
  September 28,
2013
  September 29,
2012
  September 28,
2013
  September 29,
2012
 

Product sales

  $ 693,480   $ 652,822   $ 2,228,268   $ 1,983,502  

Services sales

    84,552     77,017     248,053     231,002  
                   

Net sales

    778,032     729,839     2,476,321     2,214,504  

Product cost of sales

    499,190     488,739     1,591,657     1,490,885  

Services cost of sales

    53,278     48,698     162,260     145,508  
                   

Total cost of sales

    552,468     537,437     1,753,917     1,636,393  
                   

Gross profit

    225,564     192,402     722,404     578,111  

Selling, general and administrative expenses

    115,663     102,020     350,048     307,559  
                   

Operating income

    109,901     90,382     372,356     270,552  
                   

Other income (expenses):

                         

Interest expense

    (8,149 )   (8,429 )   (24,364 )   (23,657 )

Interest income

    1,560     2,093     4,765     6,081  

Other

    (584 )   1,307     1,095     907  
                   

    (7,173 )   (5,029 )   (18,504 )   (16,669 )
                   

Earnings before income taxes and equity in earnings of nonconsolidated subsidiaries

    102,728     85,353     353,852     253,883  
                   

Income tax expense (benefit):

                         

Current

    40,458     27,928     127,328     90,942  

Deferred

    3,454     519     (1,275 )   (3,937 )
                   

    43,912     28,447     126,053     87,005  
                   

Earnings before equity in earnings of nonconsolidated subsidiaries

    58,816     56,906     227,799     166,878  

Equity in earnings of nonconsolidated subsidiaries

    75     1,536     548     5,311  
                   

Net earnings

    58,891     58,442     228,347     172,189  

Less: Earnings attributable to noncontrolling interests

    (2,402 )   (1,711 )   (4,726 )   (3,153 )
                   

Net earnings attributable to Valmont Industries, Inc. 

  $ 56,489   $ 56,731   $ 223,621     169,036  
                   

Earnings per share:

                         

Basic

  $ 2.12   $ 2.14   $ 8.40   $ 6.39  
                   

Diluted

  $ 2.10   $ 2.12   $ 8.31   $ 6.32  
                   

Cash dividends declared per share

  $ 0.250   $ 0.225   $ 0.725   $ 0.630  
                   

Weighted average number of shares of common stock outstanding—Basic (000 omitted)

    26,665     26,502     26,632     26,455  
                   

Weighted average number of shares of common stock outstanding—Diluted (000 omitted)

    26,919     26,806     26,896     26,748  
                   

   

See accompanying notes to condensed consolidated financial statements.

3


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Dollars in thousands)

(Unaudited)

 
  Thirteen Weeks Ended   Thirty-nine Weeks Ended  
 
  September 28,
2013
  September 29,
2012
  September 28,
2013
  September 29,
2012
 

Net earnings

  $ 58,891   $ 58,442   $ 228,347   $ 172,189  
                   

Other comprehensive income (loss), net of tax:

                         

Foreign currency translation adjustments:

                         

Unrealized translation gain (loss)          

    18,124     23,747     (44,458 )   22,488  

Realized loss included in net earnings during the period

            (5,194 )    

Unrealized loss on cash flow hedge:

                         

Amortization cost included in interest expense              

    100     100     300     300  

Actuarial gain (loss) in defined benefit pension plan          

    857     1,962     (37 )   2,595  
                   

Other comprehensive income (loss)

    19,081     25,809     (49,389 )   25,383  
                   

Comprehensive income

    77,972     84,251     178,958     197,572  

Comprehensive loss (income) attributable to noncontrolling interests

    (2,156 )   (2,958 )   1,033     (5,439 )
                   

Comprehensive income attributable to Valmont Industries, Inc. 

  $ 75,816   $ 81,293   $ 179,991   $ 192,133  
                   

   

See accompanying notes to condensed consolidated financial statements.

4


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except shares and per share amounts)

(Unaudited)

 
  September 28,
2013
  December 29,
2012
 

ASSETS

             

Current assets:

             

Cash and cash equivalents

  $ 543,369   $ 414,129  

Receivables, net

    513,832     515,902  

Inventories

    427,215     412,384  

Prepaid expenses

    35,071     25,144  

Refundable and deferred income taxes

    81,766     58,381  
           

Total current assets

    1,601,253     1,425,940  
           

Property, plant and equipment, at cost

    1,045,110     994,774  

Less accumulated depreciation and amortization

    504,080     482,162  
           

Net property, plant and equipment

    541,030     512,612  
           

Goodwill

    340,495     330,791  

Other intangible assets, net

    169,904     172,270  

Other assets

    95,838     126,938  
           

Total assets

  $ 2,748,520   $ 2,568,551  
           

LIABILITIES AND SHAREHOLDERS' EQUITY

             

Current liabilities:

             

Current installments of long-term debt

  $ 265   $ 224  

Notes payable to banks

    17,129     13,375  

Accounts payable

    214,188     212,424  

Accrued employee compensation and benefits

    108,774     101,905  

Accrued expenses

    87,614     78,503  

Dividends payable

    6,697     6,002  
           

Total current liabilities

    434,667     412,433  
           

Deferred income taxes

    79,305     88,300  

Long-term debt, excluding current installments

    471,294     472,593  

Defined benefit pension liability

    99,135     112,043  

Deferred compensation

    38,917     31,920  

Other noncurrent liabilities

    49,417     44,252  

Shareholders' equity:

             

Preferred stock of $1 par value—

             

Authorized 500,000 shares; none issued

         

Common stock of $1 par value—

             

Authorized 75,000,000 shares; 27,900,000 issued

    27,900     27,900  

Retained earnings

    1,514,099     1,300,529  

Accumulated other comprehensive income (loss)

    308     43,938  

Treasury stock

    (21,145 )   (22,455 )
           

Total Valmont Industries, Inc. shareholders' equity

    1,521,162     1,349,912  
           

Noncontrolling interest in consolidated subsidiaries

    54,623     57,098  
           

Total shareholders' equity

    1,575,785     1,407,010  
           

Total liabilities and shareholders' equity

  $ 2,748,520   $ 2,568,551  
           

   

See accompanying notes to condensed consolidated financial statements.

5


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

(Unaudited)

 
  Thirty-nine Weeks Ended  
 
  September 28,
2013
  September 29,
2012
 

Cash flows from operating activities:

             

Net earnings

  $ 228,347   $ 172,189  

Adjustments to reconcile net earnings to net cash flows from operations:

             

Depreciation and amortization

    57,417     52,262  

Stock-based compensation

    4,999     4,517  

Defined benefit pension plan expense

    4,870     3,076  

Contribution to defined benefit pension plan

    (16,755 )   (11,591 )

Gain on sale of property, plant and equipment

    (5,060 )   (187 )

Equity in earnings in nonconsolidated subsidiaries

    (548 )   (5,311 )

Deferred income taxes

    (1,275 )   (3,937 )

Changes in assets and liabilities (net of acquisitions):

             

Receivables

    (757 )   (46,663 )

Inventories

    (14,574 )   (36,507 )

Prepaid expenses

    (7,041 )   (3,657 )

Accounts payable

    1,161     (35 )

Accrued expenses

    16,931     15,989  

Other noncurrent liabilities

    2,510     (723 )

Income taxes payable

    (21,120 )   (21,740 )
           

Net cash flows from operating activities

    249,105     117,682  
           

Cash flows from investing activities:

             

Purchase of property, plant and equipment

    (75,072 )   (58,700 )

Proceeds from sale of assets

    39,564     5,597  

Acquisitions, net of cash acquired

    (53,152 )    

Other, net

    1,231     80  
           

Net cash flows from investing activities

    (87,429 )   (53,023 )
           

Cash flows from financing activities:

             

Net borrowings under short-term agreements

    3,439     4,096  

Proceeds from long-term borrowings

    274     39,126  

Principal payments on long-term borrowings

    (508 )   (39,280 )

Proceeds from sale of partial ownership interest

        1,404  

Dividends paid

    (18,717 )   (15,530 )

Dividends to noncontrolling interest

    (1,767 )   (1,379 )

Debt issuance costs

        (1,703 )

Proceeds from exercises under stock plans

    15,064     19,527  

Excess tax benefits from stock option exercises

    4,630     4,212  

Purchase of common treasury shares—stock plan exercises

    (14,644 )   (19,116 )
           

Net cash flows from financing activities

    (12,229 )   (8,643 )
           

Effect of exchange rate changes on cash and cash equivalents

    (20,207 )   8,170  
           

Net change in cash and cash equivalents

    129,240     64,186  

Cash and cash equivalents—beginning of year

    414,129     362,894  
           

Cash and cash equivalents—end of period

  $ 543,369   $ 427,080  
           

   

See accompanying notes to condensed consolidated financial statements.

6


Table of Contents


VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(Dollars in thousands)

(Unaudited)

 
  Common
stock
  Additional
paid-in
capital
  Retained
earnings
  Accumulated
other
comprehensive
income (loss)
  Treasury
stock
  Noncontrolling
interest in
consolidated
subsidiaries
  Total
shareholders'
equity
 

Balance at December 31, 2011

  $ 27,900   $   $ 1,079,698   $ 64,052   $ (24,688 ) $ 50,949   $ 1,197,911  

Net earnings

            169,036             3,153     172,189  

Other comprehensive income (loss)

                23,097         2,286     25,383  

Cash dividends declared

            (16,754 )               (16,754 )

Dividends to noncontrolling interests

                        (1,379 )   (1,379 )

Sale of partial ownership interest

        (610 )               2,014     1,404  

Stock plan exercises; 159,555 shares acquired

                    (19,116 )       (19,116 )

Stock options exercised; 295,570 shares issued

        (8,027 )   6,860         20,694         19,527  

Tax benefit from stock option exercises

        4,212                       4,212  

Stock option expense

        3,735                       3,735  

Stock awards; 402 shares issued

        690             92         782  
                               

Balance at September 29, 2012

  $ 27,900   $   $ 1,238,840   $ 87,149   $ (23,018 ) $ 57,023   $ 1,387,894  
                               

Balance at December 29, 2012

  $ 27,900   $   $ 1,300,529   $ 43,938   $ (22,455 ) $ 57,098   $ 1,407,010  

Net earnings

            223,621             4,726     228,347  

Other comprehensive loss

                (43,630 )       (5,759 )   (49,389 )

Cash dividends declared

            (19,412 )               (19,412 )

Dividends to noncontrolling interests

                        (1,767 )   (1,767 )

Acquisition of Locker

                        325     325  

Stock plan exercises; 93,059 shares acquired

                    (14,644 )       (14,644 )

Stock options exercised; 192,377 shares issued

        (9,629 )   9,361         15,332         15,064  

Tax benefit from stock option exercises

        4,630                     4,630  

Stock option expense

        3,935                     3,935  

Stock awards; 9,801 shares issued

        1,064             622         1,686  
                               

Balance at September 28, 2013

  $ 27,900   $   $ 1,514,099   $ 308   $ (21,145 ) $ 54,623   $ 1,575,785  
                               

   

See accompanying notes to condensed consolidated financial statements.

7


Table of Contents


VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except per share amounts)

(Unaudited)

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    Condensed Consolidated Financial Statements

        The Condensed Consolidated Balance Sheet as of September 28, 2013, the Condensed Consolidated Statements of Earnings and Comprehensive Income for the thirteen and thirty-nine weeks ended September 28, 2013 and September 29, 2012, and the Condensed Consolidated Statements of Cash Flows and Shareholders' Equity for the thirty-nine week periods then ended have been prepared by the Company, without audit. In the opinion of management, all necessary adjustments (which include normal recurring adjustments) have been made to present fairly the financial statements as of September 28, 2013 and for all periods presented.

        Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These Condensed Consolidated Financial Statements should be read in conjunction with the financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2012. The accounting policies and methods of computation followed in these interim financial statements are the same as those followed in the financial statements for the year ended December 29, 2012. In 2013, the Company changed its presentation of certain intercompany utility structure sales to align with management's current reporting structure. Fiscal 2012 reporting was reclassified to conform with the 2013 presentation. Accordingly, fiscal 2012 EIP segment sales (and the associated intersegment sales elimination) for the thirteen and thirty-nine weeks ended September 29, 2012 increased by $15,374 and $31,436, respectively. Fiscal 2012 segment sales (after intersegment sales eliminations) and operating income were unchanged from amounts previously reported. The results of operations for the period ended September 28, 2013 are not necessarily indicative of the operating results for the full year.

    Inventories

        Approximately 40% and 43% of inventory is valued at the lower of cost, determined on the last-in, first-out (LIFO) method, or market as of September 28, 2013 and December 29, 2012, respectively. All other inventory is valued at the lower of cost, determined on the first-in, first-out (FIFO) method or market. Finished goods and manufactured goods inventories include the costs of acquired raw materials and related factory labor and overhead charges required to convert raw materials to manufactured and finished goods. The excess of replacement cost of inventories over the LIFO value is approximately $43,242 and $45,822 at September 28, 2013 and December 29, 2012, respectively.

8


Table of Contents


VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        Inventories consisted of the following:

 
  September 28,
2013
  December 29,
2012
 

Raw materials and purchased parts

  $ 200,316   $ 199,808  

Work-in-process

    33,261     36,114  

Finished goods and manufactured goods

    236,880     222,284  
           

Subtotal

    470,457     458,206  

Less: LIFO reserve

    43,242     45,822  
           

  $ 427,215   $ 412,384  
           

    Income Taxes

        Earnings before income taxes and equity in earnings of nonconsolidated subsidiaries for the thirteen and thirty-nine weeks ended September 28, 2013 and September 29, 2012, were as follows:

 
  Thirteen Weeks
Ended
  Thirty-nine Weeks
Ended
 
 
  2013   2012   2013   2012  

United States

  $ 66,143   $ 48,524   $ 253,564   $ 179,351  

Foreign

    36,585     36,829     100,288     74,532  
                   

  $ 102,728   $ 85,353   $ 353,852   $ 253,883  
                   

    Pension Benefits

        The Company incurs expenses in connection with the Delta Pension Plan ("DPP"). The DPP was acquired as part of the Delta plc acquisition in fiscal 2010 and has no members that are active employees. In order to measure expense and the related benefit obligation, various assumptions are made including discount rates used to value the obligation, expected return on plan assets used to fund these expenses and estimated future inflation rates. These assumptions are based on historical experience as well as current facts and circumstances. An actuarial analysis is used to measure the expense and liability associated with pension benefits.

        The components of the net periodic pension expense for the thirty-nine weeks ended September 28, 2013 and September 29, 2012 were as follows:

 
  2013   2012  

Net periodic benefit expense:

             

Interest cost

  $ 19,593   $ 17,399  

Expected return on plan assets

    (14,723 )   (14,323 )
           

Net periodic benefit expense

  $ 4,870   $ 3,076  
           

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

    Stock Plans

        The Company maintains stock-based compensation plans approved by the shareholders, which provide that the Human Resource Committee of the Board of Directors may grant incentive stock options, nonqualified stock options, stock appreciation rights, non-vested stock awards and bonuses of common stock. At September 28, 2013, 1,687,864 shares of common stock remained available for issuance under the plans. Shares and options issued and available are subject to changes in capitalization.

        Under the plans, the exercise price of each option equals the closing market price at the date of the grant. Options vest beginning on the first anniversary of the grant in equal amounts over three to six years or on the fifth anniversary of the grant.

        Expiration of grants is from six to ten years from the date of grant. The Company's compensation expense (included in selling, general and administrative expenses) and associated income tax benefits related to stock options for the thirteen and thirty-nine weeks ended September 28, 2013 and September 29, 2012, respectively, were as follows:

 
  Thirteen Weeks
Ended
  Thirty-nine Weeks
Ended
 
 
  2013   2012   2013   2012  

Compensation expense

  $ 1,308   $ 1,245   $ 3,935   $ 3,735  

Income tax benefits

    504     479     1,515     1,438  

    Equity Method Investments

        The Company has equity method investments in non-consolidated subsidiaries, which are recorded within "Other assets" on the Condensed Consolidated Balance Sheet. In February 2013, the Company sold its nonconsolidated investment in Manganese Materials Company Pty. Ltd. to the majority owner of the business for approximately $29,250. The profit on the sale was not significant, which included the recognition of $5,194 in currency translation adjustments previously recorded as part of "Accumulated other comprehensive income" on the Condensed Consolidated Balance Sheet. The Company also recognized certain deferred tax benefits of approximately $3,200 associated with the sale in the first quarter of fiscal 2013.

    Fair Value

        The Company applies the provisions of Accounting Standards Codification 820, Fair Value Measurements ("ASC 820") which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The provisions of ASC 820 apply to other accounting pronouncements that require or permit fair value measurements. As defined in ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

        ASC 820 establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. Inputs refer

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. Financial assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:

            Level 1:    Quoted market prices in active markets for identical assets or liabilities.

            Level 2:    Observable market based inputs or unobservable inputs that are corroborated by market data.

            Level 3:    Unobservable inputs that are not corroborated by market data.

        The categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

        Following is a description of the valuation methodologies used for assets and liabilities measured at fair value.

        Trading Securities: The assets and liabilities recorded for the investments held in the Valmont Deferred Compensation Plan represent mutual funds, invested in debt and equity securities, classified as trading securities in accordance with Accounting Standards Codification 320, Accounting for Certain Investments in Debt and Equity Securities, considering the employee's ability to change investment allocation of their deferred compensation at any time. Quoted market prices are available for these securities in an active market and therefore categorized as a Level 1 input.

 
   
  Fair Value Measurement Using:  
 
  Carrying Value
September 28,
2013
  Quoted Prices in
Active Markets
for Identical
Assets (Level 1)
  Significant Other
Observable
Inputs
(Level 2)
  Significant
Unobservable
Inputs
(Level 3)
 

Assets:

                         

Trading Securities

  $ 26,291   $ 26,291   $   $  

 

 
   
  Fair Value Measurement Using:  
 
  Carrying Value
December 29,
2012
  Quoted Prices in
Active Markets
for Identical
Assets (Level 1)
  Significant Other
Observable
Inputs
(Level 2)
  Significant
Unobservable
Inputs
(Level 3)
 

Assets:

                         

Trading Securities

  $ 20,087   $ 20,087   $   $  

    Comprehensive Income

        Comprehensive income includes net earnings, currency translation adjustments, certain derivative-related activity and changes in net actuarial gains/losses from a pension plan. Results of operations for foreign subsidiaries are translated using the average exchange rates during the period. Assets and

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

liabilities are translated at the exchange rates in effect on the balance sheet dates. Accumulated other comprehensive income (loss) consisted of the following at September 28, 2013 and December 29, 2012:

 
  Foreign
Currency
Translation
Adjustments
  Unrealized
Loss on Cash
Flow Hedge
  Defined
Benefit
Pension Plan
  Accumulated
Other
Comprehensive
Income
 

Balance at December 29, 2012

  $ 30,576   $ (2,935 ) $ 16,297   $ 43,938  

Current-period comprehensive income (loss)

    (43,893 )   300     (37 )   (43,630 )
                   

Balance at September 28, 2013

  $ (13,317 ) $ (2,635 ) $ 16,260   $ 308  
                   

(2) ACQUISITION OF LOCKER GROUP HOLDINGS PTY. LTD.

        On February 5, 2013, the Company purchased 100% of the outstanding shares of Locker Group Holdings Pty. Ltd. (Locker). Locker is a manufacturer of perforated and expanded metal for the non-residential market, industrial flooring and handrails for the access systems market, and screening media for applications in the industrial and mining sectors in Australia and Asia. Locker's annual sales for the twelve months prior to the acquisition date were approximately $80,000 and its operations are reported in the Engineered Infrastructure Products Segment. The purchase price paid for the business at closing (net of $116 cash acquired) was $53,152. In addition, a maximum of $7,911 additional purchase price may be paid to the sellers upon the achievement of certain gross profit and inventory targets over the next two years. The Company determined the present value of the potential additional purchase price at February 5, 2013 to be $6,175. The acquisition, which was funded by cash held by the Company, was completed to expand our product offering and sales coverage for access systems and related products in Asia Pacific.

        The fair value measurement was completed at September 28, 2013. The following table summarizes the fair values of the assets acquired and liabilities assumed as of the date of acquisition.

 
  At February 5,
2013
 

Current assets

  $ 25,584  

Property, plant and equipment

    20,412  

Intangible assets

    11,205  

Goodwill

    13,322  
       

Total fair value of assets acquired

  $ 70,523  
       

Current liabilities

    9,595  

Deferred income taxes

    483  

Other non-current liabilities

    677  

Non-controlling interests

    325  
       

Total fair value of liabilities assumed and non-controlling interests

    11,080  
       

Net assets acquired

  $ 59,443  
       

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(2) ACQUISITION OF LOCKER GROUP HOLDINGS PTY. LTD. (Continued)

        The Company's Condensed Consolidated Statements of Earnings for the thirteen and thirty-nine weeks ended September 28, 2013 included net sales of $16,755 and $46,692, respectively, and net earnings of $836 and $1,375, respectively, resulting from Locker's operations from February 5, 2013 to September 28, 2013.

        Based on the fair value assessments, the Company allocated $11,205 of the purchase price to acquired intangible assets. The following table summarizes the major classes of Locker acquired intangible assets and the respective weighted-average amortization periods:

 
  Amount   Weighted
Average
Amortization
Period
(Years)
 

Trade Names

  $ 4,116     Indefinite  

Customer Relationships

    6,042     10.0  

Software and Technology

    1,047     5.0  
             

  $ 11,205        
             

(3) GOODWILL AND INTANGIBLE ASSETS

    Amortized Intangible Assets

        The components of amortized intangible assets at September 28, 2013 and December 29, 2012 were as follows:

 
  September 28, 2013
 
  Gross
Carrying
Amount
  Accumulated
Amortization
  Weighted
Average
Life

Customer Relationships

  $ 175,273   $ 73,081   13 years

Proprietary Software & Database

    3,958     2,875   6 years

Patents & Proprietary Technology

    9,961     6,691   8 years

Non-compete Agreements

    1,802     1,607   6 years
             

  $ 190,994   $ 84,254    
             

 

 
  December 29, 2012
 
  Gross
Carrying
Amount
  Accumulated
Amortization
  Weighted
Average
Life

Customer Relationships

  $ 170,556   $ 62,957   13 years

Proprietary Software & Database

    3,073     2,795   6 years

Patents & Proprietary Technology

    9,953     5,517   8 years

Non-compete Agreements

    1,807     1,542   6 years
             

  $ 185,389   $ 72,811    
             

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(3) GOODWILL AND INTANGIBLE ASSETS (Continued)

        Amortization expense for intangible assets for the thirteen and thirty-nine weeks ended September 28, 2013 and September 29, 2012, respectively was as follows:

 
  Thirteen Weeks
Ended
  Thirty-nine Weeks
Ended
   
 
  2013   2012   2013   2012    
    $ 3,750   $ 3,582   $ 11,446   $ 10,751    

        Estimated annual amortization expense related to finite-lived intangible assets is as follows:

 
  Estimated
Amortization
Expense
 

2013

  $ 15,322  

2014

    15,328  

2015

    14,442  

2016

    13,884  

2017

    13,845  

        The useful lives assigned to finite-lived intangible assets included consideration of factors such as the Company's past and expected experience related to customer retention rates, the remaining legal or contractual life of the underlying arrangement that resulted in the recognition of the intangible asset and the Company's expected use of the intangible asset.

    Non-amortized intangible assets

        Intangible assets with indefinite lives are not amortized. The carrying values of trade names at September 28, 2013 and December 29, 2012 were as follows:

 
  September 28,
2013
  December 29,
2012
  Year
Acquired
 

Webforge

  $ 17,372   $ 17,411     2010  

Newmark

    11,111     11,111     2004  

Ingal EPS/Ingal Civil Products

    9,168     9,189     2010  

Donhad

    6,917     6,932     2010  

Industrial Galvanizers

    4,021     4,030     2010  

Other

    14,575     11,019        
                 

  $ 63,164   $ 59,692        
                 

        In its determination of these intangible assets as indefinite-lived, the Company considered such factors as its expected future use of the intangible asset, legal, regulatory, technological and competitive factors that may impact the useful life or value of the intangible asset and the expected costs to maintain the value of the intangible asset. The Company expects that these intangible assets will maintain their value indefinitely. Accordingly, these assets are not amortized.

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(3) GOODWILL AND INTANGIBLE ASSETS (Continued)

        The Company's trade names were tested for impairment in the third quarter of 2013. The values of the trade names were determined using the relief-from-royalty method. Based on this evaluation, the Company determined that its trade names were not impaired.

    Goodwill

        The carrying amount of goodwill by segment as of September 28, 2013 and December 29, 2012 was as follows:

 
  Engineered
Infrastructure
Products
Segment
  Utility
Support
Structures
Segment
  Coatings
Segment
  Irrigation
Segment
  Other   Total  

Balance at December 29, 2012

  $ 155,185   $ 77,141   $ 77,053   $ 2,517   $ 18,895   $ 330,791  

Acquisitions

    13,322                     13,322  

Foreign currency translation

    (3,630 )       120     (67 )   (41 )   (3,618 )

Other

    1,737     (1,737 )                
                           

Balance at September 28, 2013

  $ 166,614   $ 75,404   $ 77,173   $ 2,450   $ 18,854   $ 340,495  
                           

        The goodwill from acquisitions arose from the acquisition of Locker. The Company's goodwill was tested for impairment during the third quarter of 2013. As a result of that testing, the Company determined that its goodwill was not impaired, as the valuation of the reporting units exceeded their respective carrying values. The Company continues to monitor changes in the global economy that could impact future operating results of its reporting units. If such conditions arise, the Company will test a given reporting unit for impairment prior to the annual test.

(4) CASH FLOW SUPPLEMENTARY INFORMATION

        The Company considers all highly liquid temporary cash investments purchased with an original maturity of three months or less at the time of purchase to be cash equivalents. Cash payments for interest and income taxes (net of refunds) for the thirty-nine weeks ended September 28, 2013 and September 29, 2012 were as follows:

 
  2013   2012  

Interest

  $ 17,010   $ 15,797  

Income taxes

    149,529     106,887  

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(5) EARNINGS PER SHARE

        The following table provides a reconciliation between Basic and Diluted earnings per share (EPS):

 
  Basic EPS   Dilutive
Effect of
Stock Options
  Diluted EPS  

Thirteen weeks ended September 28, 2013:

                   

Net earnings attributable to Valmont Industries, Inc. 

  $ 56,489   $   $ 56,489  

Shares outstanding

    26,665     254     26,919  

Per share amount

  $ 2.12   $ (0.02 ) $ 2.10  

Thirteen weeks ended September 29, 2012:

                   

Net earnings attributable to Valmont Industries, Inc. 

  $ 56,731   $   $ 56,731  

Shares outstanding

    26,502     304     26,806  

Per share amount

  $ 2.14   $ (0.02 ) $ 2.12  

Thirty-nine weeks ended September 28, 2013:

                   

Net earnings attributable to Valmont Industries, Inc. 

  $ 223,621   $   $ 223,621  

Shares outstanding

    26,632     264     26,896  

Per share amount

  $ 8.40   $ (0.09 ) $ 8.31  

Thirty-nine weeks ended September 29, 2012:

                   

Net earnings attributable to Valmont Industries, Inc. 

  $ 169,036   $   $ 169,036  

Shares outstanding

    26,455     293     26,748  

Per share amount

  $ 6.39   $ (0.07 ) $ 6.32  

        At September 28, 2013 there were 1,172 outstanding stock options with exercise prices exceeding the market price of common stock that were excluded from the computation of diluted earnings per share for the thirteen weeks and thirty-nine weeks ending September 28, 2013. At September 29, 2012, there were no outstanding stock options with exercise prices exceeding the market price of common stock.

(6) BUSINESS SEGMENTS

        The Company has four reportable segments based on its management structure. Each segment is global in nature with a manager responsible for segment operational performance and the allocation of capital within the segment. Net corporate expense is net of certain service-related expenses that are allocated to business units generally on the basis of employee headcounts and sales dollars.

        Reportable segments are as follows:

        ENGINEERED INFRASTRUCTURE PRODUCTS:    This segment consists of the manufacture of engineered metal structures and components for the global lighting and traffic, wireless communication, roadway safety and access systems applications;

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(6) BUSINESS SEGMENTS (Continued)

        UTILITY SUPPORT STRUCTURES:    This segment consists of the manufacture of engineered steel and concrete structures for the global utility industry;

        COATINGS:    This segment consists of galvanizing, anodizing and powder coating services on a global basis; and

        IRRIGATION:    This segment consists of the manufacture of agricultural irrigation equipment and related parts and services for the global agricultural industry.

        In addition to these four reportable segments, the Company has other businesses and activities that individually are not more than 10% of consolidated sales. These include the manufacture of forged steel grinding media for the mining industry, tubular products for industrial customers, electrolytic manganese dioxide for disposable batteries and the distribution of industrial fasteners and are reported in the "Other" category.

        The accounting policies of the reportable segments are the same as those described in Note 1. The Company evaluates the performance of its business segments based upon operating income and invested capital. The Company does not allocate interest expense, non-operating income and deductions, or income taxes to its business segments.

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(6) BUSINESS SEGMENTS (Continued)

Summary by Business

 
  Thirteen Weeks Ended   Thirty-nine Weeks Ended  
 
  September 28,
2013
  September 29,
2012
  September 28,
2013
  September 29,
2012
 

SALES:

                         

Engineered Infrastructure Products segment:

                         

Lighting, Traffic, and Roadway Products

  $ 171,991   $ 168,046   $ 480,648   $ 465,946  

Communication Products

    38,674     36,446     102,067     99,629  

Access Systems

    49,618     40,192     151,874     118,852  
                   

Engineered Infrastructure Products segment

    260,283     244,684     734,589     684,427  

Utility Support Structures segment:

                         

Steel

    199,912     184,030     611,573     536,073  

Concrete

    29,508     33,465     85,728     84,891  
                   

Utility Support Structures segment

    229,420     217,495     697,301     620,964  

Coatings segment

    89,009     83,713     272,052     251,397  

Irrigation segment

    175,120     156,452     690,002     547,214  

Other

    71,836     72,500     233,384     245,757  
                   

Total

    825,668     774,844     2,627,328     2,349,759  

INTERSEGMENT SALES:

                         

Engineered Infrastructure Products segment

    24,970     25,352     76,591     68,498  

Utility Support Structures segment

    489     625     1,199     3,072  

Coatings segment

    13,697     12,313     42,475     38,262  

Irrigation segment

    4     67     5     498  

Other

    8,476     6,648     30,737     24,925  
                   

Total

    47,636     45,005     151,007     135,255  

NET SALES:

                         

Engineered Infrastructure Products segment

    235,313     219,332     657,998     615,929  

Utility Support Structures segment

    228,931     216,870     696,102     617,892  

Coatings segment

    75,312     71,400     229,577     213,135  

Irrigation segment

    175,116     156,385     689,997     546,716  

Other

    63,360     65,852     202,647     220,832  
                   

Total

  $ 778,032   $ 729,839   $ 2,476,321   $ 2,214,504  
                   

OPERATING INCOME:

                         

Engineered Infrastructure Products segment

  $ 25,689   $ 18,715   $ 61,026   $ 40,907  

Utility Support Structures segment

    41,491     30,223     129,767     81,901  

Coatings segment

    19,833     18,542     56,805     54,571  

Irrigation segment

    31,145     27,140     149,878     103,155  

Other

    9,978     9,743     33,790     33,413  

Corporate

    (18,235 )   (13,981 )   (58,910 )   (43,395 )
                   

Total

  $ 109,901   $ 90,382   $ 372,356   $ 270,552  
                   

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION

        The Company has $450,000 principal amount of senior unsecured notes outstanding at a coupon interest rate of 6.625% per annum. The notes are guaranteed, jointly, severally, fully and unconditionally by certain of the Company's current and future direct and indirect domestic and foreign subsidiaries (collectively the "Guarantors"), excluding its other current domestic and foreign subsidiaries which do not guarantee the debt (collectively referred to as the "Non-Guarantors"). All Guarantors are 100% owned by the parent company.

        Consolidated financial information for the Company ("Parent"), the Guarantor subsidiaries and the Non-Guarantor subsidiaries is as follows:


CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
For the Thirteen weeks ended September 28, 2013

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Net sales

  $ 331,525   $ 161,432   $ 366,522   $ (81,447 ) $ 778,032  

Cost of sales

    238,692     121,870     273,317     (81,411 )   552,468  
                       

Gross profit

    92,833     39,562     93,205     (36 )   225,564  

Selling, general and administrative expenses

    51,621     14,530     49,512         115,663  
                       

Operating income

    41,212     25,032     43,693     (36 )   109,901  
                       

Other income (expense):

                               

Interest expense

    (7,724 )   (11,122 )   (425 )   11,122     (8,149 )

Interest income

    18     242     12,422     (11,122 )   1,560  

Other

    1,422     9     (2,015 )       (584 )
                       

    (6,284 )   (10,871 )   9,982         (7,173 )
                       

Earnings before income taxes and equity in earnings of nonconsolidated subsidiaries

    34,928     14,161     53,675     (36 )   102,728  
                       

Income tax expense (benefit):

                               

Current

    19,473     7,419     13,631     (65 )   40,458  

Deferred

    (4,969 )   (360 )   8,783         3,454  
                       

    14,504     7,059     22,414     (65 )   43,912  
                       

Earnings before equity in earnings of nonconsolidated subsidiaries

    20,424     7,102     31,261     29     58,816  

Equity in earnings of nonconsolidated subsidiaries

    36,065     6,542         (42,532 )   75  
                       

Net earnings

    56,489     13,644     31,261     (42,503 )   58,891  

Less: Earnings attributable to noncontrolling interests

            (2,402 )       (2,402 )
                       

Net earnings attributable to Valmont Industries, Inc

  $ 56,489   $ 13,644   $ 28,859   $ (42,503 ) $ 56,489  
                       

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
For the Thirty-nine Weeks Ended September 28, 2013

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Net sales

  $ 1,174,955   $ 501,308   $ 1,052,733   $ (252,675 ) $ 2,476,321  

Cost of sales

    837,321     377,158     795,182     (255,744 )   1,753,917  
                       

Gross profit

    337,634     124,150     257,551     3,069     722,404  

Selling, general and administrative expenses

    157,367     42,871     149,810         350,048  
                       

Operating income

    180,267     81,279     107,741     3,069     372,356  
                       

Other income (expense):

                               

Interest expense

    (23,115 )   (35,696 )   (1,249 )   35,696     (24,364 )

Interest income

    33     732     39,696     (35,696 )   4,765  

Other

    3,224     55     (2,184 )       1,095  
                       

    (19,858 )   (34,909 )   36,263         (18,504 )
                       

Earnings before income taxes and equity in earnings of nonconsolidated subsidiaries

    160,409     46,370     144,004     3,069     353,852  
                       

Income tax expense (benefit):

                               

Current

    65,472     20,801     40,283     772     127,328  

Deferred

    (7,473 )   1,342     4,856         (1,275 )
                       

    57,999     22,143     45,139     772     126,053  
                       

Earnings before equity in earnings of nonconsolidated subsidiaries

    102,410     24,227     98,865     2,297     227,799  

Equity in earnings of nonconsolidated subsidiaries

    121,211     48,927     207     (169,797 )   548  
                       

Net earnings

    223,621     73,154     99,072     (167,500 )   228,347  

Less: Earnings attributable to noncontrolling interests

            (4,726 )       (4,726 )
                       

Net earnings attributable to Valmont Industries, Inc

  $ 223,621   $ 73,154   $ 94,346   $ (167,500 ) $ 223,621  
                       

20


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
For the Thirteen weeks ended September 29, 2012

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Net sales

  $ 301,667   $ 160,318   $ 350,837   $ (82,983 ) $ 729,839  

Cost of sales

    226,539     127,116     266,532     (82,750 )   537,437  
                       

Gross profit

    75,128     33,202     84,305     (233 )   192,402  

Selling, general and administrative expenses

    41,747     13,449     46,824         102,020  
                       

Operating income

    33,381     19,753     37,481     (233 )   90,382  
                       

Other income (expense):

                               

Interest expense

    (8,215 )   (12,635 )   (213 )   12,634     (8,429 )

Interest income

    15     398     14,314     (12,634 )   2,093  

Other

    883     15     409         1,307  
                       

    (7,317 )   (12,222 )   14,510         (5,029 )
                       

Earnings before income taxes and equity in earnings of nonconsolidated subsidiaries

    26,064     7,531     51,991     (233 )   85,353  
                       

Income tax expense (benefit):

                               

Current

    8,096     4,786     15,701     (655 )   27,928  

Deferred

    (1,063 )   (558 )   2,140         519  
                       

    7,033     4,228     17,841     (655 )   28,447  
                       

Earnings before equity in earnings of nonconsolidated subsidiaries

    19,031     3,303     34,150     422     56,906  

Equity in earnings of nonconsolidated subsidiaries

    37,700     18,557     918     (55,639 )   1,536  
                       

Net earnings

    56,731     21,860     35,068     (55,217 )   58,442  

Less: Earnings attributable to noncontrolling interests

            (1,711 )       (1,711 )
                       

Net earnings attributable to Valmont Industries, Inc

  $ 56,731   $ 21,860   $ 33,357   $ (55,217 ) $ 56,731  
                       

21


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
For the Thirty-nine Weeks Ended September 29, 2012

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Net sales

  $ 1,014,150   $ 441,189   $ 977,950   $ (218,785 ) $ 2,214,504  

Cost of sales

    743,608     352,416     757,829     (217,460 )   1,636,393  
                       

Gross profit

    270,542     88,773     220,121     (1,325 )   578,111  

Selling, general and administrative expenses

    128,781     40,414     138,364         307,559  
                       

Operating income

    141,761     48,359     81,757     (1,325 )   270,552  

Other income (expense):

                               

Interest expense

    (23,470 )   (37,136 )   (186 )   37,135     (23,657 )

Interest income

    29     721     42,466     (37,135 )   6,081  

Other

    1,888     40     (1,021 )       907  
                       

    (21,553 )   (36,375 )   41,259         (16,669 )
                       

Earnings before income taxes and equity in earnings of nonconsolidated subsidiaries

    120,208     11,984     123,016     (1,325 )   253,883  
                       

Income tax expense (benefit):

                               

Current

    44,644     10,082     36,871     (655 )   90,942  

Deferred

    (3,832 )   (419 )   314         (3,937 )
                       

    40,812     9,663     37,185     (655 )   87,005  
                       

Earnings before equity in earnings of nonconsolidated subsidiaries

    79,396     2,321     85,831     (670 )   166,878  

Equity in earnings of nonconsolidated subsidiaries

    89,640     64,918     4,850     (154,097 )   5,311  
                       

Net earnings

    169,036     67,239     90,681     (154,767 )   172,189  

Less: Earnings attributable to noncontrolling interests

            (3,153 )       (3,153 )
                       

Net earnings attributable to Valmont Industries, Inc

  $ 169,036   $ 67,239   $ 87,528   $ (154,767 ) $ 169,036  
                       

22


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Thirteen weeks ended September 28, 2013

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Net earnings

  $ 56,489   $ 13,644   $ 31,261   $ (42,503 ) $ 58,891  
                       

Other comprehensive income (loss), net of tax:

                               

Foreign currency translation adjustments:

                               

Unrealized gains (losses) arising during the period

        30,221     (12,097 )       18,124  
                       

        30,221     (12,097 )       18,124  
                       

Unrealized loss on cash flow hedge:

                               

Amortization cost included in interest expense          

    100                 100  
                       

    100                 100  
                       

Actuarial gain (loss) in defined benefit pension plan liability

            857         857  

Equity in other comprehensive income

   
19,227
   
   
   
(19,227

)
 
 
                       

Other comprehensive income (loss)

    19,327     30,221     (11,240 )   (19,227 )   19,081  
                       

Comprehensive income

    75,816     43,865     20,021     (61,730 )   77,972  

Comprehensive income attributable to noncontrolling interests

            (2,156 )       (2,156 )
                       

Comprehensive income attributable to Valmont Industries, Inc. 

  $ 75,816   $ 43,865   $ 17,865   $ (61,730 ) $ 75,816  
                       

23


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)


CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Thirty-nine Weeks Ended September 28, 2013

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Net earnings

  $ 223,621   $ 73,154   $ 99,072   $ (167,500 ) $ 228,347  
                       

Other comprehensive income (loss), net of tax:

                               

Foreign currency translation adjustments:

                               

Unrealized gains (losses) arising during the period

        57,707     (102,165 )       (44,458 )

Realized (loss) included in net earnings during the period

            (5,194 )       (5,194 )
                       

        57,707     (107,359 )       (49,652 )
                       

Unrealized loss on cash flow hedge:

                               

Amortization cost included in interest expense          

    300                 300  
                       

    300                 300  
                       

Actuarial gain (loss) in defined benefit pension plan liability

            (37 )       (37 )

Equity in other comprehensive income

   
(43,930

)
 
         
43,930
   
 
                       

Other comprehensive income (loss)

    (43,630 )   57,707     (107,396 )   43,930     (49,389 )
                       

Comprehensive income

    179,991     130,861     (8,324 )   (123,570 )   178,958  

Comprehensive income attributable to noncontrolling interests

            1,033         1,033  
                       

Comprehensive income attributable to Valmont Industries, Inc. 

  $ 179,991   $ 130,861   $ (7,291 ) $ (123,570 ) $ 179,991  
                       

24


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)


CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Thirteen weeks ended September 29, 2012

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Net earnings

  $ 56,731   $ 21,860   $ 35,068   $ (55,217 ) $ 58,442  
                       

Other comprehensive income (loss), net of tax:

                               

Foreign currency translation adjustments:

                               

Unrealized gains (losses) arising during the period

        (14,977 )   39,084     (360 )   23,747  
                       

        (14,977 )   39,084     (360 )   23,747  
                       

Unrealized loss on cash flow hedge:

                               

Amortization cost included in interest expense          

    100                 100  
                       

    100                 100  
                       

Actuarial gain (loss) in defined benefit pension plan liability

            1,962         1,962  

Equity in other comprehensive income

   
24,462
   
   
   
(24,462

)
 
 
                       

Other comprehensive income (loss)

    24,562     (14,977 )   41,046     (24,822 )   25,809  
                       

Comprehensive income

    81,293     6,883     76,114     (80,039 )   84,251  

Comprehensive income attributable to noncontrolling interests

            (2,958 )       (2,958 )
                       

Comprehensive income attributable to Valmont Industries, Inc. 

  $ 81,293   $ 6,883   $ 73,156   $ (80,039 ) $ 81,293  
                       

25


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)


CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Thirty-nine Weeks Ended September 29, 2012

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Net earnings

  $ 169,036   $ 67,239   $ 90,681   $ (154,767 ) $ 172,189  
                       

Other comprehensive income (loss), net of tax:

                               

Foreign currency translation adjustments:

                               

Unrealized gains (losses) arising during the period

        (17,221 )   46,580     (6,871 )   22,488  
                       

        (17,221 )   46,580     (6,871 )   22,488  
                       

Unrealized loss on cash flow hedge:

                               

Amortization cost included in interest expense          

    300                 300  
                       

    300                 300  
                       

Actuarial gain in defined benefit pension plan liability

            2,595         2,595  

Equity in other comprehensive income

   
22,797
   
   
   
(22,797

)
 
 
                       

Other comprehensive income (loss)

    23,097     (17,221 )   49,175     (29,668 )   25,383  
                       

Comprehensive income

    192,133     50,018     139,856     (184,435 )   197,572  

Comprehensive income attributable to noncontrolling interests

            (5,439 )       (5,439 )
                       

Comprehensive income attributable to Valmont Industries, Inc. 

  $ 192,133   $ 50,018   $ 134,417   $ (184,435 ) $ 192,133  
                       

26


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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)

CONDENSED CONSOLIDATED BALANCE SHEETS
September 28, 2013

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

ASSETS

                               

Current assets:

                               

Cash and cash equivalents

  $ 158,360   $ 51,186   $ 333,823   $   $ 543,369  

Receivables, net

    135,423     82,840     295,569         513,832  

Inventories

    142,773     77,545     206,897         427,215  

Prepaid expenses

    8,301     740     26,030         35,071  

Refundable and deferred income taxes

    50,796     6,174     24,796         81,766  
                       

Total current assets

    495,653     218,485     887,115         1,601,253  
                       

Property, plant and equipment, at cost

    492,814     140,823     411,473         1,045,110  

Less accumulated depreciation and amortization

    299,858     60,595     143,627         504,080  
                       

Net property, plant and equipment

    192,956     80,228     267,846         541,030  
                       

Goodwill

    20,108     107,542     212,845         340,495  

Other intangible assets

    382     49,665     119,857         169,904  

Investment in subsidiaries and intercompany accounts

    1,477,628     1,337,088     585,304     (3,400,020 )    

Other assets

    38,147         57,691         95,838  
                       

Total assets

  $ 2,224,874   $ 1,793,008   $ 2,130,658   $ (3,400,020 ) $ 2,748,520  
                       

LIABILITIES AND SHAREHOLDERS' EQUITY

                               

Current liabilities:

                               

Current installments of long-term debt

  $ 188   $   $ 77   $   $ 265  

Notes payable to banks

            17,129         17,129  

Accounts payable

    60,642     19,014     134,532         214,188  

Accrued employee compensation and benefits                  

    65,924     10,542     32,308         108,774  

Accrued expenses

    43,610     4,514     39,490         87,614  

Dividends payable

    6,697                 6,697  
                       

Total current liabilities

    177,061     34,070     223,536         434,667  
                       

Deferred income taxes

    17,437     28,464     33,404         79,305  

Long-term debt, excluding current installments

    470,549     539,517     745     (539,517 )   471,294  

Defined benefit pension liability

            99,135         99,135  

Deferred compensation

    31,456         7,461         38,917  

Other noncurrent liabilities

    7,209         42,208         49,417  

Shareholders' equity:

                               

Common stock of $1 par value

    27,900     457,950     254,982     (712,932 )   27,900  

Additional paid-in capital

        150,286     893,274     (1,043,560 )    

Retained earnings

    1,514,099     540,393     514,611     (1,055,004 )   1,514,099  

Accumulated other comprehensive income (loss)

    308     42,328     6,679     (49,007 )   308  

Treasury stock

    (21,145 )               (21,145 )
                       

Total Valmont Industries, Inc. shareholders' equity

    1,521,162     1,190,957     1,669,546     (2,860,503 )   1,521,162  
                       

Noncontrolling interest in consolidated subsidiaries

            54,623         54,623  
                       

Total shareholders' equity

    1,521,162     1,190,957     1,724,169     (2,860,503 )   1,575,785  
                       

Total liabilities and shareholders' equity

  $ 2,224,874   $ 1,793,008   $ 2,130,658   $ (3,400,020 ) $ 2,748,520  
                       

27


Table of Contents


VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)

CONDENSED CONSOLIDATED BALANCE SHEETS
December 29, 2012

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

ASSETS

                               

Current assets:

                               

Cash and cash equivalents

  $ 40,926   $ 83,203   $ 290,000   $   $ 414,129  

Receivables, net

    144,161     86,403     285,338         515,902  

Inventories

    146,619     71,988     193,777         412,384  

Prepaid expenses

    7,153     1,029     16,962         25,144  

Refundable and deferred income taxes

    29,359     6,904     22,118         58,381  
                       

Total current assets

    368,218     249,527     808,195         1,425,940  
                       

Property, plant and equipment, at cost

    456,497     122,937     415,340         994,774  

Less accumulated depreciation and amortization

    288,226     55,239     138,697         482,162  
                       

Net property, plant and equipment

    168,271     67,698     276,643         512,612  
                       

Goodwill

    20,108     107,542     203,141         330,791  

Other intangible assets

    499     53,517     118,254         172,270  

Investment in subsidiaries and intercompany accounts

    1,456,159     1,246,777     615,152     (3,318,088 )    

Other assets

    32,511         94,427         126,938  
                       

Total assets

  $ 2,045,766   $ 1,725,061   $ 2,115,812   $ (3,318,088 ) $ 2,568,551  
                       

LIABILITIES AND SHAREHOLDERS' EQUITY

                               

Current liabilities:

                               

Current installments of long-term debt

  $ 189   $   $ 35   $   $ 224  

Notes payable to banks

            13,375         13,375  

Accounts payable

    72,610     22,006     117,808         212,424  

Accrued employee compensation and benefits                  

    61,572     10,530     29,803           101,905  

Accrued expenses

    30,641     4,674     43,188         78,503  

Income taxes payable

        31     669     (700 )    

Dividends payable

    6,002                 6,002  
                       

Total current liabilities

    171,014     37,241     204,878     (700 )   412,433  
                       

Deferred income taxes

    23,305     27,851     37,144         88,300  

Long-term debt, excluding current installments

    471,828     599,873     765     (599,873 )   472,593  

Defined benefit pension liability

            112,043         112,043  

Deferred compensation

    25,200         6,720         31,920  

Other noncurrent liabilities

    4,507         39,745         44,252  

Shareholders' equity:

                               

Common stock of $1 par value

    27,900     457,950     254,982     (712,932 )   27,900  

Additional paid-in capital

        150,286     893,274     (1,043,560 )    

Retained earnings

    1,300,529     467,240     443,337     (910,577 )   1,300,529  

Accumulated other comprehensive income

    43,938     (15,380 )   65,826     (50,446 )   43,938  

Treasury stock

    (22,455 )               (22,455 )
                       

Total Valmont Industries, Inc. shareholders' equity

    1,349,912     1,060,096     1,657,419     (2,717,515 )   1,349,912  
                       

Noncontrolling interest in consolidated subsidiaries

            57,098         57,098  
                       

Total shareholders' equity

    1,349,912     1,060,096     1,714,517     (2,717,515 )   1,407,010  
                       

Total liabilities and shareholders' equity

  $ 2,045,766   $ 1,725,061   $ 2,115,812   $ (3,318,088 ) $ 2,568,551  
                       

28


Table of Contents


VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Thirty-nine Weeks Ended September 28, 2013

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Cash flows from operating activities:

                               

Net earnings

  $ 223,621   $ 73,154   $ 99,072   $ (167,500 ) $ 228,347  

Adjustments to reconcile net earnings to net cash flows from operations:

                               

Depreciation and amortization

    15,252     9,620     32,545         57,417  

Stock-based compensation

    4,999                 4,999  

Defined benefit pension plan expense

            4,870         4,870  

Contribution to defined benefit pension plan

            (16,755 )       (16,755 )

Gain on sale of property, plant and equipment

    354     37     (5,451 )       (5,060 )

Equity in earnings in nonconsolidated subsidiaries            

    (341 )       (207 )       (548 )

Deferred income taxes

    (7,473 )   1,342     4,856         (1,275 )

Changes in assets and liabilities (net of acquisitions):

                               

Receivables

    8,737     3,552     (13,046 )       (757 )

Inventories

    3,146     (5,556 )   (12,164 )       (14,574 )

Prepaid expenses

    (1,148 )   290     (6,183 )       (7,041 )

Accounts payable

    (11,968 )   (2,992 )   16,121         1,161  

Accrued expenses

    17,944     (148 )   (865 )       16,931  

Other noncurrent liabilities

    5,987         (3,477 )         2,510  

Income taxes payable (refundable)

    (19,833 )   (2,035 )   (77 )   825     (21,120 )
                       

Net cash flows from operating activities

    239,277     77,264     99,239     (166,675 )   249,105  
                       

Cash flows from investing activities:

                               

Purchase of property, plant and equipment

    (41,034 )   (18,381 )   (15,657 )       (75,072 )

Proceeds from sale of assets

    1,492     35     38,037         39,564  

Acquisitions, net of cash acquired

            (53,152 )       (53,152 )

Other, net

    (68,447 )   (105,512 )   8,515     166,675     1,231  
                       

Net cash flows from investing activities

    (107,989 )   (123,858 )   (22,257 )   166,675     (87,429 )
                       

Cash flows from financing activities:

                               

Net borrowings under short-term agreements

            3,439         3,439  

Proceeds from long-term borrowings

            274         274  

Principal payments on long-term borrowings

    (187 )       (321 )       (508 )

Dividends paid

    (18,717 )               (18,717 )

Intercompany dividends

        20,133     (20,133 )        

Dividends to noncontrolling interest

            (1,767 )       (1,767 )

Proceeds from exercises under stock plans

    15,064                 15,064  

Excess tax benefits from stock option exercises

    4,630                 4,630  

Purchase of common treasury shares—stock plan exercises:

    (14,644 )               (14,644 )
                       

Net cash flows from financing activities

    (13,854 )   20,133     (18,508 )       (12,229 )
                       

Effect of exchange rate changes on cash and cash equivalents

        (5,556 )   (14,651 )       (20,207 )
                       

Net change in cash and cash equivalents

    117,434     (32,017 )   43,823         129,240  

Cash and cash equivalents—beginning of year

    40,926     83,203     290,000         414,129  
                       

Cash and cash equivalents—end of period

  $ 158,360   $ 51,186   $ 333,823   $   $ 543,369  
                       

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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share amounts)

(Unaudited)

(7) GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Continued)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Thirty-nine Weeks Ended September 29, 2012

 
  Parent   Guarantors   Non-Guarantors   Eliminations   Total  

Cash flows from operations:

                               

Net earnings

  $ 169,036   $ 67,239   $ 90,681   $ (154,767 ) $ 172,189  

Adjustments to reconcile net earnings to net cash flows from operations:

                               

Depreciation and amortization

    14,183     9,602     28,477         52,262  

Stock-based compensation

    4,517                 4,517  

Defined benefit pension plan expense

            3,076         3,076  

Contribution to defined benefit pension plan

            (11,591 )       (11,591 )

Gain on sale of property, plant and equipment

    (66 )   (58 )   (63 )       (187 )

Equity in earnings of nonconsolidated subsidiaries            

    (461 )       (4,850 )       (5,311 )

Deferred income taxes

    (3,832 )   (419 )   314         (3,937 )

Changes in assets and liabilities:

                               

Receivables

    (5,806 )   (18,798 )   (22,059 )       (46,663 )

Inventories

    1,705     (11,409 )   (26,803 )       (36,507 )

Prepaid expenses

    (741 )   (43 )   (2,873 )       (3,657 )

Accounts payable

    (14,260 )   3,280     10,945         (35 )

Accrued expenses

    16,577     (607 )   19         15,989  

Other noncurrent liabilities

    532         (1,255 )       (723 )

Income taxes payable (refundable)

    (19,897 )   273     (1,461 )   (655 )   (21,740 )
                       

Net cash flows from operations

    161,487     49,060     62,557     (155,422 )   117,682  
                       

Cash flows from investing activities:

                               

Purchase of property, plant and equipment

    (23,270 )   (10,885 )   (24,545 )       (58,700 )

Proceeds from sale of assets

    112     71     5,414         5,597  

Other, net

    (77,917 )   (15,657 )   (61,768 )   155,422     80  
                       

Net cash flows from investing activities

    (101,075 )   (26,471 )   (80,899 )   155,422     (53,023 )
                       

Cash flows from financing activities:

                               

Net borrowings under short-term agreements

            4,096         4,096  

Proceeds from long-term borrowings

    39,000         126         39,126  

Principal payments on long-term borrowings

    (39,197 )       (83 )       (39,280 )

Proceeds from sale of partial ownership interest

            1,404         1,404  

Dividends paid

    (15,530 )               (15,530 )

Dividend to noncontrolling interests

            (1,379 )       (1,379 )

Debt issuance costs

    (1,703 )               (1,703 )

Proceeds from exercises under stock plans

    19,527                 19,527  

Excess tax benefits from stock option exercises

    4,212                 4,212  

Purchase of common treasury shares—stock plan exercises

    (19,116 )               (19,116 )
                       

Net cash flows from financing activities

    (12,807 )       4,164         (8,643 )
                       

Effect of exchange rate changes on cash and cash equivalents

        1,318     6,852         8,170  
                       

Net change in cash and cash equivalents

    47,605     23,907     (7,326 )       64,186  

Cash and cash equivalents—beginning of year

    27,545     18,257     317,092         362,894  
                       

Cash and cash equivalents—end of period

  $ 75,150   $ 42,164   $ 309,766   $   $ 427,080  
                       

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Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations

        Management's discussion and analysis contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on assumptions that management has made in light of experience in the industries in which the Company operates, as well as management's perceptions of historical trends, current conditions, expected future developments and other factors believed to be appropriate under the circumstances. These statements are not guarantees of performance or results. They involve risks, uncertainties (some of which are beyond the Company's control) and assumptions. Management believes that these forward-looking statements are based on reasonable assumptions. Many factors could affect the Company's actual financial results and cause them to differ materially from those anticipated in the forward-looking statements. These factors include, among other things, risk factors described from time to time in the Company's reports to the Securities and Exchange Commission, as well as future economic and market circumstances, industry conditions, company performance and financial results, operating efficiencies, availability and price of raw materials, availability and market acceptance of new products, product pricing, domestic and international competitive environments, and actions and policy changes of domestic and foreign governments.

        This discussion should be read in conjunction with the financial statements and notes thereto, and the management's discussion and analysis included in the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2012. Segment sales in the table below are presented net of intersegment sales.

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Results of Operations

        Dollars in millions, except per share amounts

 
  Thirteen Weeks Ended   Thirty-nine Weeks Ended  
 
  September 28,
2013
  September 29,
2012
  % Incr.
(Decr.)
  September 28,
2013
  September 29,
2012
  % Incr.
(Decr.)
 

Consolidated

                                     

Net sales

  $ 778.0   $ 729.8     6.6 % $ 2,476.3   $ 2,214.5     11.8 %

Gross profit

    225.6     192.4     17.3 %   722.4     578.1     25.0 %

as a percent of sales

    29.0 %   26.4 %         29.2 %   26.1 %      

SG&A expense

    115.7     102.0     13.4 %   350.0     307.6     13.8 %

as a percent of sales

    14.9 %   14.0 %         14.1 %   13.9 %      

Operating income

    109.9     90.4     21.6 %   372.4     270.6     37.6 %

as a percent of sales

    14.1 %   12.4 %         15.0 %   12.2 %      

Net interest expense

    6.6     6.3     4.8 %   19.6     17.6     11.4 %

Effective tax rate

    42.8 %   34.1 %         35.6 %   36.2 %      

Net earnings

  $ 56.5   $ 56.7     (0.4 )% $ 223.6   $ 169.0     32.3 %

Diluted earnings per share

  $ 2.10   $ 2.12     (0.9 )% $ 8.31   $ 6.32     31.5 %

Engineered Infrastructure Products

                                     

Net sales

  $ 235.3   $ 219.3     7.3 % $ 658.0   $ 616.0     6.8 %

Gross profit

    67.6     59.0     14.6 %   186.0     160.1     16.2 %

SG&A expense

    41.9     40.3     4.0 %   125.0     119.2     4.9 %

Operating income

    25.7     18.7     37.4 %   61.0     40.9     49.1 %

Utility Support Structures

                                     

Net sales

  $ 228.9   $ 216.9     5.5 % $ 696.1   $ 617.9     12.7 %

Gross profit

    61.8     47.9     29.0 %   189.8     134.5     41.1 %

SG&A expense

    20.3     17.7     14.7 %   60.0     52.6     14.1 %

Operating income

    41.5     30.2     37.4 %   129.8     81.9     58.5 %

Coatings

                                     

Net sales

  $ 75.3   $ 71.4     5.5 % $ 229.6   $ 213.1     7.7 %

Gross profit

    28.7     26.3     9.1 %   80.9     79.0     2.4 %

SG&A expense

    8.9     7.7     15.6 %   24.1     24.4     (1.2 )%

Operating income

    19.8     18.6     6.5 %   56.8     54.6     4.0 %

Irrigation

                                     

Net sales

  $ 175.1   $ 156.4     12.0 % $ 690.0   $ 546.7     26.2 %

Gross profit

    52.8     44.5     18.7 %   216.3     156.4     38.3 %

SG&A expense

    21.7     17.3     25.4 %   66.4     53.2     24.8 %

Operating income

    31.1     27.2     14.3 %   149.9     103.2     45.3 %

Other

                                     

Net sales

  $ 63.4   $ 65.8     (3.6 )% $ 202.6   $ 220.8     (8.2 )%

Gross profit

    14.8     14.5     2.1 %   49.2     47.9     2.7 %

SG&A expense

    4.8     4.8     %   15.4     14.5     6.2 %

Operating income

    10.0     9.7     3.1 %   33.8     33.4     1.2 %

Net corporate expense

                                     

Gross profit

  $ (0.1 ) $ 0.2     NM   $ 0.2   $ 0.2     NM  

SG&A expense

    18.1     14.2     27.5 %   59.1     43.6     35.6 %

Operating loss

    (18.2 )   (14.0 )   (30.0 )%   (58.9 )   (43.4 )   (35.7 )%

    NM=Not meaningful

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Overview

        On a consolidated basis, the increase in net sales in the third quarter and first three quarters of fiscal 2013, as compared with 2012, reflected improved sales in all reportable segments while sales were down in the "Other" category. Fiscal 2013 refers to the thirteen and thirty-nine week periods ended September 28, 2013 and fiscal 2012 refers to the thirteen and thirty-nine week periods ended September 29, 2012. The increase in net sales in fiscal 2013, as compared with fiscal 2012, was due to the following factors:

 
  Third quarter  
 
  Total   EIP   Utility   Coatings   Irrigation   Other  

Sales—2012

  $ 729.8   $ 219.3   $ 216.9   $ 71.4   $ 156.4   $ 65.8  

Volume

    17.9     5.1     (8.4 )   (2.2 )   17.8     5.6  

Pricing/mix

    21.5     (1.7 )   19.9     0.5     4.7     (1.9 )

Acquisitions

    25.9     16.8         9.1          

Currency translation

    (17.1 )   (4.2 )   0.5     (3.5 )   (3.8 )   (6.1 )
                           

Sales—2013

  $ 778.0   $ 235.3   $ 228.9   $ 75.3   $ 175.1   $ 63.4  
                           

 

 
  Year-to-date  
 
  Total   EIP   Utility   Coatings   Irrigation   Other  

Sales—2012

  $ 2,214.5   $ 616.0   $ 617.9   $ 213.1   $ 546.7   $ 220.8  

Volume

    136.9     1.0     14.4     (7.0 )   128.0     0.5  

Pricing/mix

    78.2     (1.2 )   63.2     1.9     23.6     (9.3 )

Acquisitions

    72.8     46.7         26.1          

Currency translation

    (26.1 )   (4.5 )   0.6     (4.5 )   (8.3 )   (9.4 )
                           

Sales—2013

  $ 2,476.3   $ 658.0   $ 696.1   $ 229.6   $ 690.0   $ 202.6  
                           

        Acquisitions included Locker Group Holdings ("Locker") and Pure Metal Galvanizing ("PMG"). We acquired PMG in December 2012 and Locker in February 2013. We report Locker in the Engineered Infrastructure Products segment and PMG in the Coatings segment.

        In the third quarter and first three quarters of fiscal 2013, we realized a decrease in operating profit, as compared with fiscal 2012, due to currency translation effects. On average, the U.S. dollar strengthened in particular against the Australian dollar, Brazilian Real and South Africa Rand, resulting in less operating profit in U.S. dollar terms. The breakdown of this effect by segment was as follows:

 
  Total   EIP   Coatings   Irrigation   Other   Corporate  

Third quarter

  $ (2.2 ) $ (0.6 ) $ (0.6 ) $ (0.5 ) $ (0.5 ) $  

Year-to-date

  $ (3.1 ) $ (0.5 ) $ (0.7 ) $ (1.3 ) $ (0.7 ) $ 0.1  
                           

        The increase in gross margin (gross profit as a percent of sales) in fiscal 2013, as compared with 2012, was due to a combination of improved sales prices and sales mix, improved factory operations and moderating raw material costs in 2013, as compared with 2012. In general, our cost of steel and other raw materials were slightly lower in the third quarter and first three quarters of 2013, as compared with the same periods in 2012.

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        Selling, general and administrative (SG&A) spending in the third quarter and first three quarters of fiscal 2013, as compared with the same period in 2012, increased mainly due to the following factors:

    Expenses recorded by Locker and PMG, which were acquired after the third quarter of 2012, of $4.9 million and $14.4 million, respectively;

    Increased compensation expenses of $2.1 million and $7.1 million, respectively, mainly associated with increased employment levels and salary increases, and;

    Increased employee incentive accruals of $1.2 million and $9.9 million, respectively, due to improved operating results and increased share price in valuing long-term incentive plans.

        In addition, certain non-recurring items affecting the comparisons of SG&A expenses included:

    The sale of one of our galvanizing facilities in Australia resulted in a gain of $4.6 million in the second quarter of 2013, which was reported as a reduction of SG&A expense, and;

    Insurance proceeds received in fiscal 2012 related to a fire in one of our galvanizing facilities in Australia resulted in a non-recurring reduction in SG&A in the third quarter and first three quarters of fiscal 2012 of $0.6 million and $2.0 million, respectively.

        On a reportable segment basis, all segments realized improved operating income in the third quarter and first three quarters of 2013, as compared with 2012.

        Net interest expense increased in the the third quarter and first three quarters of fiscal 2013, as compared with 2012, due to a combination of lower interest income, as we used invested cash to fund the Locker acquisition, and slightly higher interest expense. The increase in interest expense principally was due to higher bank fees and interest incurred due to international working capital borrowings.

        The increase in other expense in the third quarter of 2013, as compared with 2012, mainly was attributable to foreign exchange transaction losses due to currency volatility.

        Our effective income tax rate in the third quarter of fiscal 2013 was higher than the same period in fiscal 2012, principally due to a lowering of U.K. income tax rates and reconciliation of our annual income tax filings. In fiscal 2012 and 2013, U.K. tax rates were collectively reduced from 25% to 20%. Accordingly, we reduced the value of our deferred tax assets associated with net operating loss carryforwards and certain timing differences by $8.3 million in the third quarter of fiscal 2013 ($4.7 million in fiscal 2012), with a corresponding increase in income tax expense. On a year-to-date basis, the effects of the U.K. tax rate decrease were offset somewhat by approximately $1.5 million of tax benefits associated with the first quarter 2013 sale of our nonconsolidated investment in South Africa and $1.4 million of increased research and development tax credits in the U.S.

        Earnings in non-consolidated subsidiaries were lower in fiscal 2013, as compared with 2012, due to the sale of our 49% owned manganese materials operation in February 2013. There was no significant gain or loss on the sale.

        Our cash flows generated by operations were approximately $249.1 million in the first three quarters of fiscal 2013, as compared with $117.7 million in 2012. The increase in operating cash flow in the first three quarters of fiscal 2013 was the result of improved net earnings and less additional working capital to support the improved sales in 2013, as compared with 2012.

    Engineered Infrastructure Products (EIP) segment

        The increase in net sales in the third quarter and first three quarters of fiscal 2013 as compared with 2012 was mainly due to the acquisition of Locker in February 2013. Global lighting sales in the third quarter and first three quarters of fiscal 2013 were comparable with the same periods in fiscal 2012. In the third quarter of fiscal 2013, sales in North America and Europe were comparable with

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Table of Contents

2012. On a year-to-date basis, North American sales were comparable with 2012 while Europe was down slightly from 2012. The transportation market for lighting and traffic structures in the U.S., while stable, continues to be challenging, due in part to the lack of long-term U.S. federal highway funding legislation. Sales in other market channels such as sales to lighting fixture manufacturers and commercial construction projects in the third quarter and first three quarters of fiscal 2013 improved somewhat as compared with the same periods in 2012. In Europe, year-to-date sales in fiscal 2013 were lower than 2012, as weak economic conditions and restricted government roadway spending activity hampered demand for lighting structures.

        Communication product line sales improved in the third quarter and first three quarters of fiscal 2013, as compared with the same periods of fiscal 2012. On a regional basis, North American sales in the third quarter and first three quarters of fiscal 2013 improved over the same periods in fiscal 2012 by $8.4 and $16.9 million, respectively. The increase in North America sales was mainly attributable to stronger sales demand for components due to 4G wireless communication development. In China, sales of wireless communication structures in the third quarter and first three quarters of fiscal 2013 were lower than the same periods in fiscal 2012.

        Access systems product line sales improved in fiscal 2013, as compared with 2012, mainly due to the Locker acquisition in February 2013. Otherwise, access systems sales in the third quarter and first three quarters of fiscal 2013 were lower than 2012, due a combination of slowness in mining sector investment in Australia and exchange rate effects due to a weaker Australian dollar in 2013 and related competitive pricing effects. Highway safety product sales in fiscal 2013 were comparable with fiscal 2012, as spending for roads and highways in Australia continues to be relatively weak due to budgetary restrictions.

        Operating income for the segment in the third quarter and first three quarters of fiscal 2013 increased, as compared with the same periods of fiscal 2012, due primarily to:

    improved operating performance of our lighting operations as a result of better factory operating performance (approximately $7.2 million and $9.8 million, respectively);

    improved North American communication product sales (approximately $1.0 million and $6.8 million), and;

    operating profit generated from Locker (approximately $1.4 million and $2.7 million, respectively).

        The increase in SG&A spending was attributable to Locker (approximately $3.8 million and $10.4 million, respectively). SG&A spending otherwise was lower in fiscal 2013, as compared with 2012, mainly associated with cost cutting measures taken in Europe in the third and fourth quarters of 2012.

    Utility Support Structures (Utility) segment

        In the Utility segment, the sales increase in the third quarter and first three quarters of fiscal 2013, as compared with 2012, was due mainly to improved sales in the U.S. market. While international sales were lower in the third quarter of 2013, as compared with the same period of 2012, year-to-date international sales in 2013 were comparable with fiscal 2012. International utility sales are more dependent on bid projects than North America.

        In the U.S., electrical utility companies continue to invest in the electrical grid at a high rate, as evidenced by record backlogs at December 29, 2012 and continued strong order flow in 2013. Certain low margin orders that shipped and were completed in fiscal 2012 contributed to improved sales prices and mix in 2013, as compared with 2012.

        Operating income in fiscal 2013, as compared with 2012, increased due to the increase in sales volumes, improved sales pricing and mix and favorable leverage of fixed costs. In addition, the third

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quarter and first three quarters of fiscal 2012 included approximately $1.3 million and $8.4 million, respectively, of unanticipated production and rework costs associated with one large order. These costs did not recur in fiscal 2013, which contributed to the gross profit improvements in fiscal 2013, as compared with 2012. The increases in SG&A expense in the third quarter and first three quarters of fiscal 2013, as compared with fiscal 2012, were mainly due to increased employee compensation ($1.0 million and $2.3 million, respectively) and incentives ($0.5 million and $1.3 million, respectively) associated with the increase in business levels and operating income.

    Coatings segment

        Coatings segment sales increased in the third quarter and first three quarters of fiscal 2013, as compared with 2012, due mainly to the December 2012 PMG acquisition. North America experienced stable external demand for galvanizing services, although internal demand from our other segments was higher in the third quarter and first three quarters of 2013, as compared with 2012. Asia Pacific volumes in 2013 were lower than 2012 due to weak demand in Australia. Unit pricing in 2013 was comparable with 2012.

        The increase in segment operating income in the third quarter and first three quarters of fiscal 2013, as compared with 2012, was mainly due to the gain on the sale of an Australian galvanizing operation in the second quarter of fiscal 2013 of $4.6 million, and operating income provided by PMG ($1.6 million and $3.1 million, respectively). These two positive effects on fiscal 2013 operating income were offset to an extent by the effect of lower external demand for coatings services in Australia and the following non-recurring favorable events that occurred in fiscal 2012:

    Insurance recoveries in the third quarter of fiscal 2012 related to fire and storm damages at one of our Australian galvanizing facilities of approximately $0.8 million, and;

    Settlement of a dispute with a vendor of approximately $0.9 million in the second quarter of 2012.

    Irrigation segment

        The increase in Irrigation segment net sales in the third quarter and first three quarters of fiscal 2013, as compared with 2012, was mainly due to sales volume increases in both North American and International markets. The pricing and sales mix effect was generally due to sales price increases that took effect in 2012 to recover higher material costs in early 2012. In global markets, the sales growth was due to very strong agricultural economies around the world. Farm commodity prices continue to be favorable. We believe that farm commodity prices have been generally favorable due to strong demand, including consumption in the production of ethanol and other fuels, and traditionally low inventories of major farm commodities. In addition, in North America, we believe widespread drought throughout much of the country in 2012 further highlighted the benefits of center pivot irrigation and contributed to enhanced demand for our products. In international markets, sales improved in the third quarter and first three quarters of fiscal 2013, as compared with 2012, mainly due to increased activity in Brazil, Eastern Europe and Australia. On balance, sales in other international regions in the third quarter and first three quarters of fiscal 2013 were comparable to the same periods of a strong fiscal 2012.

        Operating income for the segment improved in fiscal 2013 over 2012, due to improved global sales unit volumes and related price increases. Moderating raw material prices in light of higher selling prices also contributed to improved operating income in 2013, as compared with 2012. The most significant reasons for the increase in SG&A expense in 2013, as compared with 2012, related to employee compensation costs and incentives (approximately $1.1 million and $4.2 million, respectively), $0.8 million and $2.0 million in provisions for international receivables recorded in the third quarter and first three quarters of 2013 and other expenses to support the business activity levels and product development.

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    Other

        This unit includes the grinding media, industrial tubing, electrolytic manganese and industrial fasteners operations. The decrease in sales in the third quarter and first three quarters of fiscal 2013, as compared with 2012, was mainly due lower sales prices and exchange rate translation effects. Operating income in the third quarter and first three quarters of fiscal 2013 was comparable with the same periods in 2012, as lower raw material prices helped to dampen the effects of lower selling prices.

    Net corporate expense

        Net corporate expense in the third quarter and first three quarters of fiscal 2013 increased over the same periods in fiscal 2012. These increases were mainly due to:

    higher employee incentives associated with improved net earnings and share price, which affected long-term incentive plans. Third quarter incentive expense in fiscal 2013 was comparable with 2012. On a year-to-date basis, incentive expenses in fiscal 2013 were $5.3 million higher than 2012;

    insurance settlements realized in the third quarter and first three quarters of 2012 related to a fire and storm damage to one of our galvanizing facilities in Australia of $0.6 million and $2.0 million, respectively, that did not recur in fiscal 2013;

    higher compensation and employee benefit costs (approximately $1.5 million and $4.2 million, respectively), and;

    increased expenses associated with the Delta Pension Plan (approximately $0.6 million and $1.9 million, respectively).

        These increases were partially offset by 2012 stamp duties incurred in the first quarter of fiscal 2012 related to the 2011 Delta legal restructuring of $1.2 million that did not recur in 2013.

Liquidity and Capital Resources

    Cash Flows

        Working Capital and Operating Cash Flows—Net working capital was $1,166.6 million at September 28, 2013, as compared with $1,013.5 million at December 29, 2012. The increase in net working capital in 2013 mainly resulted from increased cash on hand. Cash flow provided by operations was $249.1 million in the first three quarters of fiscal 2013, as compared with $117.7 million provided by operations in the first three quarters of fiscal 2012. The increase in operating cash flow in 2013 was the result of the improvement in net earnings and working capital management in 2013, as compared with 2012. Despite higher sales levels in the first three quarters of fiscal 2013, receivable levels were comparable and inventory slightly increased as compared to December 29, 2012. Receivable turnover was slightly better in 2013, as compared with 2012, in part due to strong sales in North America, where collections generally are faster than at international locations. Inventory levels at September 28, 2013 were slightly higher than December 29, 2012, due to seasonal trends and the addition of Locker in 2013.

        Investing Cash Flows—Capital spending in the first three quarters of fiscal 2013 was $75.1 million, as compared with $58.7 million for the same period in 2012. The most significant capital spending projects in 2013 included certain capacity expansions in the Utility and Irrigation segments. We expect our capital spending for the 2013 fiscal year to be approximately $110 million. The increase in expected capital spending over 2012 is mainly due to capacity increases to meet the growing need for utility structures in the U.S. and additional manufacturing investment in the Irrigation segment. In 2013, investing cash flows included proceeds from asset sales of $39.6 million, principally consisting of $29.2 million received from the sale of our 49% owned non-consolidated subsidiary in South Africa and

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$8.2 million received from the sale of the Western Australia galvanizing operation. Investing cash flows also included $53.2 million paid for the Locker acquisition.

        Financing Cash Flows—Our total interest-bearing debt increased slightly to $488.7 million at September 28, 2013 from $486.2 million at December 29, 2012. Financing cash flows overall were lower in the first three quarters of fiscal 2013, as compared with the same period in 2012. The main reason for the decrease related to higher dividend payments associated with an increase in per share dividends in fiscal 2013.

    Financing and Capital

        We have historically funded our growth, capital spending and acquisitions through a combination of operating cash flows and debt financing. We have an internal long-term objective to maintain long-term debt as a percent of invested capital at or below 40%. At September 28, 2013, our long-term debt to invested capital ratio was 22.0%, as compared with 23.9% at December 29, 2012. Subject to our level of acquisition activity and steel industry operating conditions (which could affect the levels of inventory we need to fulfill customer commitments), we plan to maintain this ratio below 40% in 2013.

        Our debt financing at September 28, 2013 consisted primarily of long-term debt. We also maintain certain short-term bank lines of credit totaling $102.5 million, $85.3 million of which was unused at September 28, 2013. Our long-term debt principally consists of:

    $450 million face value ($462 million carrying value) of senior unsecured notes that bear interest at 6.625% per annum and are due in April 2020. We are allowed to repurchase the notes at specified prepayment premiums. These notes are guaranteed by certain of our subsidiaries.

    $400 million revolving credit agreement with a group of banks. We may increase the credit facility by up to an additional $200 million at any time, subject to participating banks increasing the amount of their lending commitments. The interest rate on our borrowings will be, at our option, either:

    (a)
    LIBOR (based on a 1, 2, 3 or 6 month interest period, as selected by us) plus 125 to 225 basis points (inclusive of facility fees), depending on our ratio of debt to earnings before taxes, interest, depreciation and amortization (EBITDA), or;

    (b)
    the higher of

      The higher of (a) the prime lending rate and (b) the Federal Funds rate plus 50 basis points plus in each case, 25 to 100 basis points (inclusive of facility fees), depending on our ratio of debt to EBITDA, or

      LIBOR (based on a 1 week interest period) plus 125 to 225 basis points (inclusive of facility fees), depending on our ratio of debt to EBITDA.

        At September 28, 2013 and December 29, 2012, we had no outstanding borrowings under the revolving credit agreement. The revolving credit agreement has a termination date of August 15, 2017, and contains certain financial covenants that may limit our additional borrowing capability under the agreement. At September 28, 2013, we had the ability to borrow $384.3 million under this facility, after consideration of standby letters of credit of $15.7 million associated with certain insurance obligations and international sales commitments.

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        These debt agreements contain covenants that require us to maintain certain coverage ratios and may limit us with respect to certain business activities, including capital expenditures. Our key debt covenants are as follows:

    Interest-bearing debt is not to exceed 3.5X EBITDA of the prior four quarters; and

    EBITDA over the prior four quarters must be at least 2.5X our interest expense over the same period.

        At September 28, 2013, we were in compliance with all covenants related to these debt agreements. The key covenant calculations at September 28, 2013 were as follows:

Interest-bearing debt

  $ 488,688  

EBITDA—last four quarters

    561,912  

Leverage ratio

    0.87  

EBITDA—last four quarters

 
$

561,912
 

Interest expense—last four quarters

    32,332  

Interest earned ratio

    17.38  

        The calculation of EBITDA—last four quarters (September 29, 2012 through September 28, 2013) is as follows:

Net cash flows from operations

  $ 328,520  

Interest expense

    32,332  

Income tax expense

    165,550  

Deferred income tax benefit

    (6,383 )

Noncontrolling interest

    (6,418 )

Equity in earnings of nonconsolidated subsidiaries

    1,366  

Stock-based compensation

    (6,311 )

Pension plan expense

    (6,075 )

Contribution to pension plan

    16,755  

Changes in assets and liabilities

    38,023  

Other

    4,553  
       

EBITDA

  $ 561,912  
       

Net earnings attributable to Valmont Industries, Inc. 

  $ 288,657  

Interest expense

    32,332  

Income tax expense

    165,550  

Depreciation and amortization expense

    75,373  
       

EBITDA

  $ 561,912  
       

        Our businesses are cyclical, but we have diversity in our markets, from a product, customer and a geographical standpoint. We have demonstrated the ability to effectively manage through business cycles and maintain liquidity. We have consistently generated operating cash flows in excess of our capital expenditures. Based on our available credit facilities, recent issuance of senior unsecured notes and our history of positive operational cash flows, we believe that we have adequate liquidity to meet our needs.

        We have not made any provision for U.S. income taxes in our financial statements on approximately $644.3 million of undistributed earnings of our foreign subsidiaries, as we intend to reinvest those earnings. Of our cash balances at September 28, 2013, approximately $381.8 million is held in entities outside the United States. If we need to repatriate foreign cash balances to the United States to meet our cash needs, income taxes would be paid to the extent that those cash repatriations

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were undistributed earnings of our foreign subsidiaries. The income taxes that we would pay if cash were repatriated depends on the amounts to be repatriated and from which country. If all of our cash outside the United States were to be repatriated to the United States, we estimate that we would pay approximately $38.6 million in income taxes to repatriate that cash.

Financial Obligations and Financial Commitments

        There have been no material changes to our financial obligations and financial commitments as described on page 37 in our Form 10-K for the fiscal year ended December 29, 2012.

Off Balance Sheet Arrangements

        There have been no changes in our off balance sheet arrangements as described on page 38 in our Form 10-K for the fiscal year ended December 29, 2012.

Critical Accounting Policies

        There have been no changes in our critical accounting policies as described on pages 39-43 in our Form 10-K for the fiscal year ended December 29, 2012 during the quarter ended September 28, 2013.

Item 3.    Quantitative and Qualitative Disclosures about Market Risk

        There were no material changes in the company's market risk during the quarter ended September 28, 2013. For additional information, refer to the section "Risk Management" in our Form 10-K for the fiscal year ended December 29, 2012.

Item 4.    Controls and Procedures

        The Company carried out an evaluation under the supervision and with the participation of the Company's management, including the Company's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures pursuant to Securities Exchange Act Rule 13a-15. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, the Company's disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed by the Company in the reports the Company files or submits under the Securities Exchange Act of 1934 is (1) accumulated and communicated to management, including the Company's Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures and (2) recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms.

        No changes in the Company's internal control over financial reporting occurred during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds


Issuer Purchases of Equity Securities

 
  (a)
  (b)
  (c)
  (d)
 
Period
  Total
Number of
Shares
Purchased
  Average Price
paid
per share
  Total Number of
Shares
Purchased as
Part of
Publicly Announced
Plans or Programs
  Maximum
Number of
Shares that May
Yet Be Purchased
Under the
Plans or Programs
 

June 30, 2013 to July 27, 2013

    6,004   $ 146.09          

July 28, 2013 to August 31, 2013

    1,181     139.91          

September 1, 2013 to September 28, 2013

                 
                   

Total

    7,185   $ 145.07          
                   

        During the third quarter, the only shares reflected above were those delivered to the Company by employees as part of stock option exercises, either to cover the purchase price of the option or the related taxes payable by the employee as part of the option exercise. The price paid per share was the market price at the date of exercise.

Item 6.    Exhibits

(a)
Exhibits

 
  Exhibit No.   Description
        10.1   Separation Agreement and Release dated August 13, 2013 between Richard P. Heyse and Valmont Industries, Inc. This document was filed as Exhibit 10.1 to Valmont's Current Report on Form 8-K dated August 13, 2013 and is incorporated herein by this reference.

 

 

 

  31.1

 

Section 302 Certificate of Chief Executive Officer

 

 

 

  31.2

 

Section 302 Certificate of Chief Financial Officer

 

 

 

  32.1

 

Section 906 Certifications of Chief Executive Officer and Chief Financial Officer

 

 

 

101 

 

The following financial information from Valmont's Quarterly Report on Form 10-Q for the quarter ended September 28, 2013, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Earnings, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows, (v) the Condensed Consolidated Statements of Shareholders' Equity, (vi) Notes to Condensed Consolidated Financial Statements and (vii) document and entity information.

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SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf and by the undersigned hereunto duly authorized.

    VALMONT INDUSTRIES, INC.
(Registrant)

 

 

/s/ TERRY J. MCCLAIN

Terry J. McClain
Chief Financial Officer (Principal Financial Officer)

Dated this 23rd day of October, 2013.

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Index of Exhibits

 
  Exhibit No.   Description
        10.1   Separation Agreement and Release dated August 13, 2013 between Richard P. Heyse and Valmont Industries, Inc. This document was filed as Exhibit 10.1 to Valmont's Current Report on Form 8-K dated August 13, 2013 and is incorporated herein by this reference.

 

 

 

  31.1

 

Section 302 Certificate of Chief Executive Officer

 

 

 

  31.2

 

Section 302 Certificate of Chief Financial Officer

 

 

 

  32.1

 

Section 906 Certifications of Chief Executive Officer and Chief Financial Officer

 

 

 

101 

 

The following financial information from Valmont's Quarterly Report on Form 10-Q for the quarter ended September 28, 2013, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Earnings, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows, (v) the Condensed Consolidated Statements of Shareholders' Equity, (vi) Notes to Condensed Consolidated Financial Statements and (vii) document and entity information.

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