x
|
Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
¨
|
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
Delaware
|
91-1650317
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
70 West Madison Street, Chicago, Illinois
|
60602
|
(Address of principal executive offices)
|
(Zip code)
|
Large accelerated filer
|
¨
|
Accelerated filer
|
x
|
Non-accelerated filer
|
¨
|
Smaller reporting company
|
¨
|
Class
|
Outstanding at November 1, 2011
|
|
Common Stock, par value $0.01 per share
|
28,660,835
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Revenue
|
$ | 230.3 | $ | 216.5 | $ | 684.3 | $ | 593.8 | ||||||||
Operating expenses:
|
||||||||||||||||
Cost of sales
|
173.1 | 160.3 | 516.1 | 436.3 | ||||||||||||
Selling, general and administrative expense
|
37.8 | 36.0 | 113.3 | 106.6 | ||||||||||||
Research and development expense
|
4.5 | 4.5 | 14.3 | 13.1 | ||||||||||||
Other expense (income), net
|
0.6 | (0.8 | ) | (0.4 | ) | (1.0 | ) | |||||||||
Operating income
|
14.3 | 16.5 | 41.0 | 38.8 | ||||||||||||
Net interest expense
|
(1.5 | ) | (2.0 | ) | (4.9 | ) | (5.9 | ) | ||||||||
Income from continuing operations before income taxes
|
12.8 | 14.5 | 36.1 | 32.9 | ||||||||||||
Provision for income taxes
|
4.7 | 5.1 | 12.7 | 11.4 | ||||||||||||
Income from continuing operations
|
8.1 | 9.4 | 23.4 | 21.5 | ||||||||||||
Loss from discontinued operations, net of taxes
|
- | - | (0.1 | ) | - | |||||||||||
Net income
|
$ | 8.1 | $ | 9.4 | $ | 23.3 | $ | 21.5 | ||||||||
Basic earnings per share:
|
||||||||||||||||
Income from continuing operations
|
$ | 0.28 | $ | 0.33 | $ | 0.81 | $ | 0.76 | ||||||||
Loss from discontinued operations
|
- | - | - | - | ||||||||||||
Net income
|
$ | 0.28 | $ | 0.33 | $ | 0.81 | $ | 0.76 | ||||||||
Diluted earnings per share:
|
||||||||||||||||
Income from continuing operations
|
$ | 0.28 | $ | 0.32 | $ | 0.80 | $ | 0.74 | ||||||||
Loss from discontinued operations
|
(0.01 | ) | - | (0.01 | ) | - | ||||||||||
Net income
|
$ | 0.27 | $ | 0.32 | $ | 0.79 | $ | 0.74 | ||||||||
Cash dividends per share
|
$ | 0.07 | $ | 0.07 | $ | 0.21 | $ | 0.21 | ||||||||
Weighted average shares outstanding:
|
||||||||||||||||
Basic
|
28.8 | 28.3 | 28.8 | 28.2 | ||||||||||||
Diluted
|
29.4 | 29.2 | 29.3 | 29.1 |
September 30,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
(Unaudited)
|
||||||||
Assets:
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$ | 20.1 | $ | 13.7 | ||||
Trade receivables, net of allowances of $3.9 and $4.8, respectively
|
158.9 | 192.7 | ||||||
Inventories
|
139.9 | 106.7 | ||||||
Other current assets
|
34.7 | 43.3 | ||||||
Assets held for sale
|
2.7 | - | ||||||
Total current assets
|
356.3 | 356.4 | ||||||
Property, plant and equipment, net of accumulated depreciation of $232.9 and $225.5, respectively
|
125.2 | 128.7 | ||||||
Other assets
|
94.9 | 97.1 | ||||||
Total Assets
|
$ | 576.4 | $ | 582.2 | ||||
Liabilities and Stockholders' Equity:
|
||||||||
Current Liabilities:
|
||||||||
Accounts payable, trade and other
|
$ | 84.9 | $ | 86.3 | ||||
Advance and progress payments
|
67.1 | 52.4 | ||||||
Other current liabilities
|
95.6 | 103.3 | ||||||
Total current liabilities
|
247.6 | 242.0 | ||||||
Long-term debt, less current portion
|
134.3 | 145.4 | ||||||
Accrued pension and other postretirement benefits, less current portion
|
61.2 | 73.0 | ||||||
Other liabilities
|
27.7 | 28.8 | ||||||
Stockholders' equity:
|
||||||||
Preferred stock, $0.01 par value; 20,000,000 shares authorized; no shares issued
|
- | - | ||||||
Common stock, $0.01 par value; 120,000,000 shares authorized; 2011: 28,654,700 issued and outstanding; 2010: 28,237,279 issued and 28,185,834 outstanding
|
0.3 | 0.3 | ||||||
Common stock held in treasury, at cost; 2010: 51,445 shares
|
- | (0.7 | ) | |||||
Additional paid-in capital
|
59.4 | 59.1 | ||||||
Retained earnings
|
90.7 | 73.6 | ||||||
Accumulated other comprehensive loss
|
(44.8 | ) | (39.3 | ) | ||||
Total stockholders' equity
|
105.6 | 93.0 | ||||||
Total Liabilities and Stockholders' Equity
|
$ | 576.4 | $ | 582.2 |
Nine Months Ended
|
||||||||
September 30,
|
||||||||
2011
|
2010
|
|||||||
Cash Flows From Operating Activities:
|
||||||||
Net income
|
$ | 23.3 | $ | 21.5 | ||||
Loss from discontinued operations, net of income taxes
|
0.1 | - | ||||||
Income from continuing operations
|
23.4 | 21.5 | ||||||
Adjustments to reconcile net income to cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
18.3 | 17.1 | ||||||
Stock-based compensation
|
4.2 | 5.4 | ||||||
Other
|
1.9 | (3.9 | ) | |||||
Changes in operating assets and liabilities:
|
||||||||
Trade receivables, net
|
31.9 | (12.2 | ) | |||||
Inventories
|
(37.0 | ) | (23.5 | ) | ||||
Accounts payable, trade and other
|
0.5 | 12.9 | ||||||
Advance and progress payments
|
16.4 | 5.1 | ||||||
Other assets and liabilities, net
|
(15.4 | ) | (16.4 | ) | ||||
Cash provided by continuing operating activities
|
44.2 | 6.0 | ||||||
Net cash required by discontinued operating activities
|
(0.4 | ) | (0.1 | ) | ||||
Cash provided by operating activities
|
43.8 | 5.9 | ||||||
Cash Flows From Investing Activities:
|
||||||||
Capital expenditures
|
(15.2 | ) | (13.4 | ) | ||||
Proceeds from disposal of assets
|
0.2 | 0.9 | ||||||
Other | (1.0 | ) | (0.4 | ) | ||||
Cash required by investing activities
|
(16.0 | ) | (12.9 | ) | ||||
Cash Flows From Financing Activities:
|
||||||||
Net increase in short-term debt
|
0.5 | 0.1 | ||||||
Net (payments) proceeds on credit facilities
|
(10.0 | ) | 9.7 | |||||
(Payments on) issuance of long-term debt
|
(1.2 | ) | 2.9 | |||||
Excess tax benefits
|
1.7 | 1.8 | ||||||
Tax withholdings on stock-based compensation awards
|
(4.8 | ) | (3.5 | ) | ||||
Dividends
|
(6.4 | ) | (6.2 | ) | ||||
Cash (required) provided by financing activities
|
(20.2 | ) | 4.8 | |||||
Effect of foreign exchange rate changes on cash and cash equivalents
|
(1.2 | ) | 0.3 | |||||
Increase (decrease) in cash and cash equivalents
|
6.4 | (1.9 | ) | |||||
Cash and cash equivalents, beginning of period
|
13.7 | 14.4 | ||||||
Cash and cash equivalents, end of period
|
$ | 20.1 | $ | 12.5 |
(In millions)
|
September 30, 2011
|
December 31, 2010
|
||||||
Raw materials
|
$ | 81.4 | $ | 65.8 | ||||
Work in process
|
49.1 | 29.8 | ||||||
Finished goods
|
70.5 | 69.6 | ||||||
Gross inventories before LIFO reserves and valuation adjustments
|
201.0 | 165.2 | ||||||
LIFO reserves and valuation adjustments
|
(61.1 | ) | (58.5 | ) | ||||
Net inventories
|
$ | 139.9 | $ | 106.7 |
Pension Benefits | Other Postretirement Benefits | |||||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||
September 30,
|
September 30,
|
September 30,
|
September 30,
|
|||||||||||||||||||||||||||||
(In millions)
|
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
||||||||||||||||||||||||
Service cost
|
$ | 0.3 | $ | 0.4 | $ | 1.1 | $ | 1.2 | $ | - | $ | - | $ | 0.1 | $ | 0.1 | ||||||||||||||||
Interest cost
|
3.6 | 3.5 | 10.8 | 10.6 | 0.1 | 0.1 | 0.3 | 0.3 | ||||||||||||||||||||||||
Expected return on assets
|
(4.6 | ) | (4.6 | ) | (13.8 | ) | (13.8 | ) | - | - | - | - | ||||||||||||||||||||
Amortization of prior service benefit
|
- | - | - | - | (0.2 | ) | (0.2 | ) | (0.7 | ) | (0.7 | ) | ||||||||||||||||||||
Amortization of actuarial losses, net
|
0.4 | 0.2 | 1.2 | 0.5 | - | - | - | - | ||||||||||||||||||||||||
Settlement cost
|
- | - | - | 0.3 | - | - | - | - | ||||||||||||||||||||||||
Net periodic benefit income
|
$ | (0.3 | ) | $ | (0.5 | ) | $ | (0.7 | ) | $ | (1.2 | ) | $ | (0.1 | ) | $ | (0.1 | ) | $ | (0.3 | ) | $ | (0.3 | ) |
Weighted Average
|
||||||||
Shares
|
Grant Date Fair Value
|
|||||||
Time-based
|
177,946 | |||||||
Performance-based
|
185,582 | * | ||||||
Granted during the nine months ended September 30, 2011
|
363,528 | $ | 18.63 |
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
(In millions)
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
Net income
|
$ | 8.1 | $ | 9.4 | $ | 23.3 | $ | 21.5 | ||||||||
Foreign currency translation adjustments
|
(12.7 | ) | 11.8 | (5.8 | ) | 2.2 | ||||||||||
Derivatives designated as hedges, net of tax of $0.1 for the three months ended September 30, 2011 and 2010
|
(0.1 | ) | (0.2 | ) | - | - | ||||||||||
Pension and other postretirement liability adjustments, net of tax of $0.1 for the three months ended September 30, 2011 and 2010 and $0.2 and $0.1 for the nine months ended September 30, 2011 and 2010, respectively
|
0.1 | - | 0.3 | - | ||||||||||||
Comprehensive income
|
$ | (4.6 | ) | $ | 21.0 | $ | 17.8 | $ | 23.7 |
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
(In millions, except per share data)
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
Basic earnings per share:
|
||||||||||||||||
Income from continuing operations
|
$ | 8.1 | $ | 9.4 | $ | 23.4 | $ | 21.5 | ||||||||
Weighted average number of shares outstanding
|
28.8 | 28.3 | 28.8 | 28.2 | ||||||||||||
Basic earnings per share from continuing operations
|
$ | 0.28 | $ | 0.33 | $ | 0.81 | $ | 0.76 | ||||||||
Diluted earnings per share:
|
||||||||||||||||
Income from continuing operations
|
$ | 8.1 | $ | 9.4 | $ | 23.4 | $ | 21.5 | ||||||||
Weighted average number of shares outstanding
|
28.8 | 28.3 | 28.8 | 28.2 | ||||||||||||
Effect of dilutive securities:
|
||||||||||||||||
Options on common stock
|
- | 0.1 | - | 0.1 | ||||||||||||
Restricted stock
|
0.6 | 0.8 | 0.5 | 0.8 | ||||||||||||
Total shares and dilutive securities
|
29.4 | 29.2 | 29.3 | 29.1 | ||||||||||||
Diluted earnings per share from continuing operations
|
$ | 0.28 | $ | 0.32 | $ | 0.80 | $ | 0.74 |
As of September 30, 2011
|
As of December 31, 2010
|
|||||||||||||||
(In millions)
|
Asset Derivatives (1)
|
Liability Derivatives (2)
|
Asset Derivatives (1)
|
Liability Derivatives (2)
|
||||||||||||
Derivatives designated as hedging instruments:
|
||||||||||||||||
Interest rate swap contract
|
$ | - | $ | - | $ | - | $ | 0.2 | ||||||||
Foreign exchange contracts
|
- | 0.6 | - | 0.4 | ||||||||||||
Total derivatives designated as hedging instruments
|
- | 0.6 | - | 0.6 | ||||||||||||
Derivatives not designated as hedging instruments:
|
||||||||||||||||
Foreign exchange contracts
|
5.8 | 7.2 | 11.9 | 8.2 | ||||||||||||
Total derivatives not designated as hedging instruments
|
$ | 5.8 | $ | 7.2 | $ | 11.9 | $ | 8.2 |
|
(1)
|
Included in other current assets and other assets on our Condensed Consolidated Balance Sheets.
|
|
(2)
|
Included in other current liabilities and other liabilities on our Condensed Consolidated Balance Sheets.
|
Derivatives designated as cash flow hedges
|
Amount of Gain (Loss)
Recognized in OCI on Derivatives (1)
|
Location of Gain (Loss) Reclassified from Accumulated OCI into Income
|
Amount of Gain (Loss)
Reclassified from Accumulated OCI into Income (1)
|
||||||||||||||||||||||||||||||
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
||||||||||||||||||||||||||||||
(In millions)
|
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
|||||||||||||||||||||||||
Interest rate swap contract
|
$ | - | $ | (0.1 | ) | $ | - | $ | (0.1 | ) |
Net interest expense
|
$ | - | $ | (0.2 | ) | $ | - | $ | (0.7 | ) | ||||||||||||
Foreign exchange contracts
|
(0.2 | ) | (0.4 | ) | (0.2 | ) | (0.6 | ) |
Revenue
|
(0.1 | ) | - | (0.3 | ) | - | ||||||||||||||||||
Total
|
$ | (0.2 | ) | $ | (0.5 | ) | $ | (0.2 | ) | $ | (0.7 | ) | $ | (0.1 | ) | $ | (0.2 | ) | $ | (0.3 | ) | $ | (0.7 | ) |
|
(1)
|
For the three and nine months ended September 30, 2011 and 2010, we recorded in other income, net an immaterial amount of ineffectiveness from cash flow hedges.
|
Derivatives not designated as hedging instruments
|
Location of Gain (Loss) Recognized in Income on Derivatives
|
Amount of Gain (Loss) Recognized in Income on Derivatives
|
||||||||||||||||
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||||
(In millions)
|
2011
|
2010
|
2011
|
2010
|
||||||||||||||
Foreign exchange contracts
|
Revenue
|
$ | 0.4 | $ | 7.4 | $ | 2.9 | $ | 8.3 | |||||||||
Foreign exchange contracts
|
Cost of sales
|
1.3 | (0.6 | ) | 1.8 | (0.7 | ) | |||||||||||
Foreign exchange contracts
|
Other income, net
|
0.3 | (0.1 | ) | 0.7 | 0.1 | ||||||||||||
Total
|
$ | 2.0 | $ | 6.7 | $ | 5.4 | $ | 7.7 | ||||||||||
Remeasurement of assets and liabilities in foreign currencies
|
1.6 | (2.6 | ) | 1.6 | (2.5 | ) | ||||||||||||
Net gain on foreign currency transactions
|
$ | 3.6 | $ | 4.1 | $ | 7.0 | $ | 5.2 |
• | Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities. |
• | Level 2: Observable inputs other than those included in Level 1. For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets. |
• |
Level 3: Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability.
|
As of September 30, 2011
|
As of December 31, 2010
|
|||||||||||||||||||||||||||||||
(In millions)
|
Total
|
Level 1
|
Level 2
|
Level 3
|
Total
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||||||||||||||
Assets:
|
||||||||||||||||||||||||||||||||
Investments
|
$ | 9.7 | $ | 9.7 | $ | - | $ | - | $ | 9.9 | $ | 9.9 | $ | - | $ | - | ||||||||||||||||
Derivatives
|
5.8 | - | 5.8 | - | 11.9 | - | 11.9 | - | ||||||||||||||||||||||||
Total assets
|
$ | 15.5 | $ | 9.7 | $ | 5.8 | $ | - | $ | 21.8 | $ | 9.9 | $ | 11.9 | $ | - | ||||||||||||||||
Liabilities:
|
||||||||||||||||||||||||||||||||
Derivatives
|
$ | 7.8 | $ | - | $ | 7.8 | $ | - | $ | 8.8 | $ | - | $ | 8.8 | $ | - |
As of September 30, 2011
|
As of December 31, 2010
|
|||||||||||||||
(In millions)
|
Carrying Value
|
Estimated Fair Value
|
Carrying Value
|
Estimated Fair Value
|
||||||||||||
6.66% senior unsecured notes due July 31, 2015
|
$ | 75.0 | $ | 84.0 | $ | 75.0 | $ | 84.8 | ||||||||
Revolving credit facility, due 2013
|
58.8 | 58.8 | 68.7 | 68.7 | ||||||||||||
4.5% Brazilian Real loan due December 31, 2012
|
1.8 | 1.7 | 3.2 | 2.8 | ||||||||||||
Other
|
0.6 | 0.6 | 0.2 | 0.2 |
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
(In millions)
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
Balance at beginning of period
|
$ | 7.9 | $ | 6.9 | $ | 8.0 | $ | 7.3 | ||||||||
Expense for new warranties
|
1.8 | 1.6 | 5.8 | 4.6 | ||||||||||||
Adjustments to existing accruals
|
(0.3 | ) | 0.2 | (0.3 | ) | - | ||||||||||
Claims paid
|
(2.3 | ) | (1.5 | ) | (6.4 | ) | (4.7 | ) | ||||||||
Balance at end of period
|
$ | 7.1 | $ | 7.2 | $ | 7.1 | $ | 7.2 |
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
(In millions)
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
Revenue
|
||||||||||||||||
JBT FoodTech
|
$ | 129.5 | $ | 124.8 | $ | 390.7 | $ | 361.9 | ||||||||
JBT AeroTech
|
98.5 | 86.9 | 288.2 | 226.3 | ||||||||||||
Other revenue (1) and intercompany eliminations
|
2.3 | 4.8 | 5.4 | 5.6 | ||||||||||||
Total revenue
|
$ | 230.3 | $ | 216.5 | $ | 684.3 | $ | 593.8 | ||||||||
Income before income taxes
|
||||||||||||||||
Segment operating profit:
|
||||||||||||||||
JBT FoodTech
|
$ | 8.2 | $ | 11.8 | $ | 27.9 | $ | 35.6 | ||||||||
JBT AeroTech
|
8.7 | 6.2 | 24.0 | 14.9 | ||||||||||||
Total segment operating profit
|
16.9 | 18.0 | 51.9 | 50.5 | ||||||||||||
Corporate items:
|
||||||||||||||||
Corporate expense (2)
|
(4.4 | ) | (4.3 | ) | (12.2 | ) | (12.0 | ) | ||||||||
Other income, net (1)
|
1.8 | 2.8 | 1.3 | 0.3 | ||||||||||||
Net interest expense
|
(1.5 | ) | (2.0 | ) | (4.9 | ) | (5.9 | ) | ||||||||
Total corporate items
|
(4.1 | ) | (3.5 | ) | (15.8 | ) | (17.6 | ) | ||||||||
Income from continuing operations before income taxes
|
$ | 12.8 | $ | 14.5 | $ | 36.1 | $ | 32.9 |
(1)
|
Other revenue comprises certain gains and losses related to foreign exchange exposure. Other income, net, generally includes stock-based compensation, other employee benefits, LIFO adjustments, restructuring costs, foreign exchange gains and losses, and the impact of unusual or strategic transactions not representative of segment operations. Restructuring costs included in other income, net were:
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
(in millions)
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
JBT FoodTech
|
$ | 0.1 | $ | - | $ | 1.3 | $ | 0.9 | ||||||||
JBT AeroTech
|
- | - | - | - | ||||||||||||
Total
|
$ | 0.1 | $ | - | $ | 1.3 | $ | 0.9 |
(2)
|
Corporate expense primarily includes corporate staff expenses.
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
·
|
freezer solutions for the freezing and chilling of meat, seafood, poultry, dairy, ready-to-eat meals, fruits, vegetables and bakery products;
|
||
·
|
protein processing solutions that portion, coat and cook poultry, meat, seafood, vegetable and bakery products;
|
||
·
|
in-container processing solutions for fruits, vegetables, soups, sauces, dairy and pet food products as well as ready-to-eat meals in a wide variety of modern packages; and
|
||
|
·
|
fruit processing solutions that extract, concentrate and aseptically process citrus, tomato and other fruits.
|
·
|
ground support equipment for cargo loading, aircraft deicing and aircraft towing;
|
||
|
·
|
gate equipment for passenger boarding, on the ground aircraft power and cooling;
|
|
|
·
|
airport services for maintenance of airport equipment, systems and facilities;
|
|
|
·
|
military equipment for cargo loading, aircraft towing and on the ground aircraft cooling; and
|
|
·
|
automated guided vehicles for material handling in the automotive, printing, warehouse, and hospital industries.
|
Three Months Ended
|
||||||||||||||||
September 30,
|
Favorable / (Unfavorable)
|
|||||||||||||||
(In millions, except %)
|
2011
|
2010
|
$ | % | ||||||||||||
Revenue
|
$ | 230.3 | $ | 216.5 | $ | 13.8 | 6.4 | % | ||||||||
Cost of sales
|
173.1 | 160.3 | (12.8 | ) | (8.0 | ) | ||||||||||
Gross profit
|
57.2 | 56.2 | 1.0 | 1.8 | ||||||||||||
Selling, general and administrative expense
|
37.8 | 36.0 | (1.8 | ) | (5.0 | ) | ||||||||||
Research and development expense
|
4.5 | 4.5 | - | - | ||||||||||||
Other expense (income), net
|
0.6 | (0.8 | ) | (1.4 | ) | * | ||||||||||
Operating income
|
14.3 | 16.5 | (2.2 | ) | (13.3 | ) | ||||||||||
Net interest expense
|
(1.5 | ) | (2.0 | ) | 0.5 | 25.0 | ||||||||||
Income from continuing operations before income taxes
|
12.8 | 14.5 | (1.7 | ) | (11.7 | ) | ||||||||||
Provision for income taxes
|
4.7 | 5.1 | 0.4 | 7.8 | ||||||||||||
Net income
|
$ | 8.1 | $ | 9.4 | $ | (1.3 | ) | (13.8 | )% |
*
|
Not meaningful
|
|
·
|
Gross profit increased by $1.0 million. However, excluding the favorable impact of foreign currency translation, gross profit decreased by $1.1 million. A decrease in gross profit margin due to higher costs in the JBT FoodTech segment resulted in $2.9 million of lower gross profit but was partially offset by $1.8 million of higher gross profit from higher sales volume.
|
|
·
|
Selling, general and administrative expense increased by $1.8 million or by $0.5 million in constant currency. Selling expense increased by $0.5 million as a result of higher marketing expenditures. General and administrative expense remained relatively flat as $1.5 million of higher costs due to higher wages were offset by lower expense related to a non-qualified deferred compensation plan.
|
|
·
|
Other expense (income), net was unfavorable by $1.4 million primarily as a result of losses on investments related to the non-qualified deferred compensation plan. The losses on the investments offset the decrease in deferred compensation expense reported in selling, general and administrative expense.
|
Three Months Ended
|
||||||||||||||||
September 30,
|
Favorable / (Unfavorable)
|
|||||||||||||||
(In millions, except %)
|
2011
|
2010
|
$ | % | ||||||||||||
Revenue
|
||||||||||||||||
JBT FoodTech
|
$ | 129.5 | $ | 124.8 | $ | 4.7 | 3.8 | % | ||||||||
JBT AeroTech
|
98.5 | 86.9 | 11.6 | 13.3 | ||||||||||||
Other revenue and intercompany eliminations
|
2.3 | 4.8 | (2.5 | ) | (52.1 | ) | ||||||||||
Total revenue
|
$ | 230.3 | $ | 216.5 | $ | 13.8 | 6.4 | % | ||||||||
Income before income taxes
|
||||||||||||||||
Segment operating profit:
|
||||||||||||||||
JBT FoodTech
|
$ | 8.2 | $ | 11.8 | $ | (3.6 | ) | (30.5 | ) % | |||||||
JBT AeroTech
|
8.7 | 6.2 | 2.5 | 40.3 | ||||||||||||
Total segment operating profit
|
16.9 | 18.0 | (1.1 | ) | (6.1 | ) | ||||||||||
Corporate items:
|
||||||||||||||||
Corporate expense
|
(4.4 | ) | (4.3 | ) | (0.1 | ) | (2.3 | ) | ||||||||
Other income, net
|
1.8 | 2.8 | (1.0 | ) | (35.7 | ) | ||||||||||
Net interest expense
|
(1.5 | ) | (2.0 | ) | 0.5 | 25.0 | ||||||||||
Total corporate items
|
(4.1 | ) | (3.5 | ) | (0.6 | ) | (17.1 | ) | ||||||||
Income from continuing operations before income taxes
|
$ | 12.8 | $ | 14.5 | $ | (1.7 | ) | (11.7 | ) % |
Nine Months Ended
|
|||||||||||||||||
September 30,
|
Favorable / (Unfavorable)
|
||||||||||||||||
(In millions, except %)
|
2011
|
2010
|
$ | % | |||||||||||||
Revenue
|
$ | 684.3 | $ | 593.8 | $ | 90.5 | 15.2 |
%
|
|||||||||
Cost of sales
|
516.1 | 436.3 | (79.8 | ) | (18.3 | ) | |||||||||||
Gross profit
|
168.2 | 157.5 | 10.7 | 6.8 | |||||||||||||
Selling, general and administrative expense
|
113.3 | 106.6 | (6.7 | ) | (6.3 | ) | |||||||||||
Research and development expense
|
14.3 | 13.1 | (1.2 | ) | (9.2 | ) | |||||||||||
Other income, net
|
(0.4 | ) | (1.0 | ) | (0.6 | ) | (60.0 | ) | |||||||||
Operating income
|
41.0 | 38.8 | 2.2 | 5.7 | |||||||||||||
Net interest expense
|
(4.9 | ) | (5.9 | ) | 1.0 | 16.9 | |||||||||||
Income from continuing operations before income taxes
|
36.1 | 32.9 | 3.2 | 9.7 | |||||||||||||
Provision for income taxes
|
12.7 | 11.4 | (1.3 | ) | (11.4 | ) | |||||||||||
Income from continuing operations
|
23.4 | 21.5 | $ | 1.9 | 8.8 | ||||||||||||
Loss from discontinued operations, net of taxes
|
(0.1 | ) | - | (0.1 | ) | (100.0 | ) | ||||||||||
Net income
|
$ | 23.3 | $ | 21.5 | $ | 1.8 | 8.4 |
%
|
|
·
|
Gross profit increased by $10.7 million. The increase in gross profit was driven by higher sales volume, which resulted in an increase in gross profit of $17.2 million. This increase was partially offset by $13.5 million of lower profit due to lower gross profit margin, which resulted from the strengthening of the Swedish Krona and an unfavorable mix of products sold as compared to the same period in the prior year. The remaining difference was due to the favorable impact of foreign currency translation.
|
|
·
|
Selling, general and administrative expenses increased by $6.7 million, but only by $2.5 million in constant currencies, and decreased as a percentage of revenue from 18.0% to 16.6%.
|
|
·
|
Research and development expense increased by $1.2 million, primarily due to expenditures on developing new gate equipment products.
|
Nine Months Ended
|
||||||||||||||||
September 30,
|
Favorable / (Unfavorable)
|
|||||||||||||||
(In millions, except %)
|
2011
|
2010
|
$ | % | ||||||||||||
Revenue
|
||||||||||||||||
JBT FoodTech
|
$ | 390.7 | $ | 361.9 | $ | 28.8 | 8.0 | % | ||||||||
JBT AeroTech
|
288.2 | 226.3 | 61.9 | 27.4 | ||||||||||||
Other revenue and intercompany eliminations
|
5.4 | 5.6 | (0.2 | ) | (3.6 | ) | ||||||||||
Total revenue
|
$ | 684.3 | $ | 593.8 | $ | 90.5 | 15.2 | % | ||||||||
Income before income taxes
|
||||||||||||||||
Segment operating profit:
|
||||||||||||||||
JBT FoodTech
|
$ | 27.9 | $ | 35.6 | $ | (7.7 | ) | (21.6 | ) % | |||||||
JBT AeroTech
|
24.0 | 14.9 | 9.1 | 61.1 | ||||||||||||
Total segment operating profit
|
51.9 | 50.5 | 1.4 | 2.8 | ||||||||||||
Corporate items:
|
||||||||||||||||
Corporate expense
|
(12.2 | ) | (12.0 | ) | (0.2 | ) | (1.7 | ) | ||||||||
Other income, net
|
1.3 | 0.3 | 1.0 | * | ||||||||||||
Net interest expense
|
(4.9 | ) | (5.9 | ) | 1.0 | 16.9 | ||||||||||
Total corporate items
|
(15.8 | ) | (17.6 | ) | 1.8 | 10.2 | ||||||||||
Income before income taxes
|
$ | 36.1 | $ | 32.9 | $ | 3.2 | 9.7 | % |
*
|
Not meaningful
|
Nine Months Ended
|
||||||||
September 30,
|
||||||||
(in millions)
|
2011
|
2010
|
||||||
JBT FoodTech
|
$ | 1.3 | $ | 0.9 | ||||
JBT AeroTech
|
- | - | ||||||
Total
|
$ | 1.3 | $ | 0.9 |
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
(In millions)
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
JBT FoodTech
|
$ | 126.1 | $ | 127.1 | $ | 414.9 | $ | 382.1 | ||||||||
JBT AeroTech
|
83.4 | 107.6 | 287.8 | 337.0 | ||||||||||||
Other and intercompany eliminations
|
2.3 | 4.8 | 5.4 | 5.8 | ||||||||||||
Total inbound orders
|
$ | 211.8 | $ | 239.5 | $ | 708.1 | $ | 724.9 |
(In millions)
|
September 30, 2011
|
December 31, 2010
|
September 30, 2010
|
|||||||||
JBT FoodTech
|
$ | 127.6 | $ | 103.4 | $ | 116.9 | ||||||
JBT AeroTech
|
183.0 | 183.4 | 225.4 | |||||||||
Total order backlog
|
$ | 310.6 | $ | 286.8 | $ | 342.3 |
Nine Months Ended
|
||||||||
September 30,
|
||||||||
(In millions)
|
2011
|
2010
|
||||||
Cash provided by continuing operating activities
|
$ | 44.2 | $ | 6.0 | ||||
Cash required by investing activities
|
(16.0 | ) | (12.9 | ) | ||||
Cash (required) provided by financing activities
|
(20.2 | ) | 4.8 | |||||
Cash required by discontinued operations
|
(0.4 | ) | (0.1 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents
|
(1.2 | ) | 0.3 | |||||
Increase (decrease) in cash and cash equivalents
|
$ | 6.4 | $ | (1.9 | ) |
Debt Instrument / Covenant
|
Measurement
|
Result as of
September 30, 2011
|
||||
Revolving credit facility
|
||||||
Interest coverage ratio (1)
|
Not less than 3.5
|
14.3
|
||||
Leverage ratio (2)
|
Not greater than 3.0
|
1.4
|
||||
Capital expenditures (3)
|
Not greater than $33 million
|
$15.2 million
|
||||
Dividends paid
|
Not greater than $20 million
|
$6.4 million
|
||||
6.66% senior unsecured notes
|
||||||
Interest coverage ratio (1)
|
Not less than 2.75
|
14.3
|
||||
Leverage ratio (2)
|
Not greater than 3.25
|
1.4
|
(1)
|
Interest coverage ratio is a comparison of the trailing twelve months Consolidated EBITDA, defined as net income plus interest expense plus income tax expense plus depreciation and amortization plus non-cash expenses and extraordinary, unusual and non-recurring items, to trailing twelve months interest expense.
|
(2)
|
Leverage ratio is a comparison of the total indebtedness, defined as total debt plus guarantees of indebtedness of others plus obligations under financial letters of credit issued against the credit facility, to the trailing twelve month Consolidated EBITDA, as defined above.
|
(3)
|
Capital expenditures are limited to $30 million plus 50 percent of the unutilized amount from prior year.
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
|
i)
|
effective in ensuring that information required to be disclosed is recorded, processed, summarized and reported within time periods specified in the SEC’s rules and forms; and
|
|
ii)
|
effective in ensuring that information required to be disclosed is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
John Bean Technologies Corporation
|
|
(Registrant)
|
|
/s/ Megan J. Donnelly
|
|
Megan J. Donnelly
|
|
Chief Accounting Officer, and duly authorized officer
|
|
Date: November 3, 2011
|
Number in
Exhibit Table
|
Description
|
|
10.11D
|
Second Amendment of JBT Corporation Employees’ Retirement Program – Part II Union Hourly Employees Retirement Plan.
|
|
10.11E
|
Third Amendment of JBT Corporation Employees’ Retirement Program – Part II Union Hourly Employees Retirement Plan.
|
|
15
|
Letter re: Unaudited interim financial information.
|
|
31.1
|
Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) /15d-14(a).
|
|
31.2
|
Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) /15d-14(a).
|
|
32.1
|
Certification of Chief Executive Officer Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
32.2
|
Certification of Chief Financial Officer Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101*
|
The following materials from John Bean Technologies Corporation’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2011, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Income, (ii) Condensed Consolidated Balance Sheets, (iii) Condensed Consolidated Statements of Cash Flows, and (iv) Notes to Condensed Consolidated Financial Statements.
|
*
|
Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of John Bean Technologies Corporation (the “registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: November 3, 2011
|
|
/s/ Charles H. Cannon, Jr.
|
|
Charles H. Cannon, Jr.
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of John Bean Technologies Corporation (the “registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: November 3, 2011
|
|
/s/ Ronald D. Mambu
|
|
Ronald D. Mambu
|
|
Vice President and Chief Financial Officer
(Principal Financial Officer)
|
(a)
|
the Quarterly Report on Form 10-Q of the Company for the fiscal quarter ended September 30, 2011, as filed with the Securities and Exchange Commission (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(b)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: November 3, 2011
|
|
/s/ Charles H. Cannon, Jr.
|
|
Charles H. Cannon, Jr.
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
(a)
|
the Quarterly Report on Form 10-Q of the Company for the fiscal quarter ended September 30, 2011, as filed with the Securities and Exchange Commission (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(b) |
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: November 3, 2011
|
|
/s/ Ronald D. Mambu
|
|
Ronald D. Mambu
|
|
Vice President and Chief Financial Officer
(Principal Financial Officer)
|
Condensed Consolidated Balance Sheets (Parentheticals) (USD $) In Millions, except Share data | Sep. 30, 2011 | Dec. 31, 2010 |
---|---|---|
Allowances, trade receivables (in Dollars) | $ 3.9 | $ 4.8 |
Accumulated depreciation (in Dollars) | $ 232.9 | $ 225.5 |
Preferred stock par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 120,000,000 | 120,000,000 |
Common stock, shares issued | 28,654,700 | 28,237,279 |
Common stock, shares outstanding | 28,654,700 | 28,185,834 |
Common stock held in treasury, at cost; shares | 0 | 51,445 |
Document And Entity Information | 9 Months Ended | |
---|---|---|
Sep. 30, 2011 | Nov. 01, 2011 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | John Bean Technologies Corp | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 28,660,835 | |
Amendment Flag | false | |
Entity Central Index Key | 0001433660 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Filer Category | Accelerated Filer | |
Entity Well-known Seasoned Issuer | No | |
Document Period End Date | Sep. 30, 2011 | |
Document Fiscal Year Focus | 2011 | |
Document Fiscal Period Focus | Q3 |
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Note 7 - Derivative Financial Instruments and Risk Management | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Derivative Instruments and Hedging Activities Disclosure [Text Block] |
Note 7:
Derivative Financial Instruments and Risk
Management
Derivative
financial instruments— We hold derivative
financial instruments for the purpose of hedging foreign
currency risks and interest rate risks of certain
identifiable and anticipated transactions.
We
manufacture and sell our products in a number of countries
throughout the world and, as a result, are exposed to
movements in foreign currency exchange rates. Our major
foreign currency exposures involve the markets in Western
Europe, South America and Asia. The purpose of our foreign
currency hedging activities is to manage the economic impact
of exchange rate volatility associated with anticipated
foreign currency purchases and sales made in the normal
course of business. We primarily utilize forward exchange
contracts with maturities of less than 2 years. As of
September 30, 2011, we held forward exchange contracts with
an aggregate notional value of $393.1 million. Many of our
sales and purchase contracts are written contemplating this
risk and therefore contain embedded derivatives, which we
take into consideration as part of our risk management
policy.
During
2010 and through January 31, 2011, we had an interest rate
swap that fixed the annual interest rate on a portion of our
borrowings under the credit facility at 4.9%. For the period
prior to January 30, 2010, the interest rate swap fixed the
interest rate on $50 million of our borrowings and for the
period from January 30, 2010 to January 31, 2011, the
interest rate swap fixed the interest rate on $25 million of
our borrowings.
Our
policy is to hold derivatives only for the purpose of hedging
risks and not for trading purposes where the objective is
solely to generate profit. Generally, we enter into hedging
relationships such that changes in the fair values or cash
flows of items and transactions being hedged are expected to
be offset by corresponding changes in the fair value of the
derivatives.
With
the exception of the interest rate swap and certain foreign
exchange derivatives entered into prior to our spin-off in
July 2008, we do not apply hedge accounting. All derivatives
are recognized on the balance sheet at their fair value and
classified based on the instrument’s maturity date. We
do not offset fair value amounts for derivative instruments
held with the same counterparty. Changes in the fair value of
derivative instruments are recorded in current earnings or
deferred in accumulated other comprehensive income (loss)
until the underlying transactions are recognized in earnings,
depending on whether a derivative is designated as, and is
effective as, a hedge. Cash flows from derivatives are
classified as cash flows from operating activities.
The
following table presents the fair value of derivative
instruments included within the condensed consolidated
balance sheets:
The
following table presents the effective portion of the gains
and losses on derivative instruments affecting the condensed
consolidated statements of income:
As
of September 30, 2011, we do not expect to reclassify a
significant amount of accumulated other comprehensive loss
into earnings within the next 12 months. All forecasted
transactions are expected to occur by 2013.
The
following table presents the location in the consolidated
statements of income of the gain (loss) recognized on
derivatives not designated as hedging instruments:
Refer
to Note 8: Fair Value of Financial Instruments for a
description of how the above financial instruments are
valued.
Credit
risk — By their nature, financial instruments
involve risk including credit risk for non-performance by
counterparties. Financial instruments that potentially
subject us to credit risk primarily consist of trade
receivables and derivative contracts. We manage the credit
risk on financial instruments by transacting only with
financially secure counterparties, requiring credit approvals
and credit limits, and monitoring counterparties’
financial condition. Our maximum exposure to credit loss in
the event of non-performance by the counterparty is limited
to the amount drawn and outstanding on the financial
instrument. Allowances for losses are established based on
collectability assessments.
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Note 3 - Pension and Other Postretirement Benefits | 9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Pension and Other Postretirement Benefits Disclosure [Text Block] |
Note 3:
Pension and Other Postretirement Benefits
Components
of net periodic benefit income were as follows:
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Note 9 - Commitments and Contingencies | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Commitments and Contingencies Disclosure [Text Block] |
Note 9:
Commitments and Contingencies
We
are involved in legal proceedings arising in the ordinary
course of business. Although the results of litigation cannot
be predicted with certainty, we do not believe that the
resolution of the proceedings that we are involved in, either
individually or taken as a whole, will have a material
adverse effect on our business, results of operations or
financial condition.
In
connection with our spin-off from FMC Technologies, Inc. in
2008, we entered into a separation and distribution agreement
with FMC Technologies, Inc. (the “Separation and
Distribution Agreement”). Under the Separation and
Distribution Agreement, we have assumed liabilities related
to specified legal proceedings arising from our business
prior to the spin-off. As a result, although FMC
Technologies, Inc. will in many cases remain the named
defendant, we will manage the litigation and indemnify FMC
Technologies, Inc. for costs, expenses and judgments arising
from this existing litigation. We do not believe that any
existing litigation we have assumed will have a material
effect on our business, results of operations or financial
condition.
Guarantees and
Product Warranties—In the ordinary course of
business with customers, vendors and others, we issue standby
letters of credit, performance bonds, surety bonds and other
guarantees. These financial instruments, which
totaled approximately $93.0 million at September 30, 2011,
represent guarantees of our future performance. We
also have provided approximately $6.4 million of bank
guarantees and letters of credit to secure a portion of our
existing financial obligations. The majority of these
financial instruments expire within two years; we expect to
replace them through the issuance of new or the extension of
existing letters of credit and surety bonds. In some
instances we guarantee a small portion of our
customers’ financing arrangements and retain recourse
to the equipment sold. As of September 30, 2011, the maximum
future payment obligation of such guarantees was $1.9 million
and the associated liability balance was $0.3 million.
Historically, we have not made significant payments
associated with guarantees of our customers’ financing
arrangements.
We
provide warranties of various lengths and terms to certain of
our customers based on standard terms and conditions and
negotiated agreements. We provide for the estimated cost of
warranties at the time revenue is recognized for products
where reliable, historical experience of warranty claims and
costs exists. We also provide warranty liability when
additional specific obligations are identified. The
obligation reflected in other current liabilities in the
condensed consolidated balance sheets is based on historical
experience by product and considers failure rates and the
related costs in correcting a product failure. Warranty cost
and accrual information is as follows:
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Note 10 - Business Segment Information | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting Disclosure [Text Block] |
Note 10:
Business Segment Information
Segment
operating profit is defined as total segment revenue less
segment operating expenses. The following items have been
excluded in computing segment operating profit: corporate
staff expense, foreign currency related gains and losses,
LIFO provisions, certain employee benefit expenses,
restructuring costs, interest income and expense and income
taxes.
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Note 8 - Fair Value of Financial Instruments | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Fair Value Disclosures [Text Block] |
Note 8:
Fair Value of Financial Instruments
The
fair value framework requires the categorization of assets
and liabilities into three levels based upon the assumptions
(inputs) used to price the assets or liabilities. Level 1
provides the most reliable measure of fair value, whereas
Level 3 generally requires significant management judgment.
The three levels are defined as follows:
Financial
assets and financial liabilities measured at fair value on a
recurring basis are as follows:
Investments
are classified as trading securities and are valued based on
quoted prices in active markets for identical assets or
liabilities that we have the ability to access. Investments
are included in other assets in the condensed consolidated
balance sheets. For the nine months ended September 30, 2011,
investments include an unrealized loss of $0.9
million. For the year ended December 31, 2010, investments
include an unrealized gain of $1.0 million. We use the income
approach as the valuation technique to measure the fair value
of derivative instruments on a recurring basis. This approach
calculates the present value of the future cash flow by
measuring the change from the derivative contract rate and
the published market indicative currency and interest rates,
multiplied by the contract notional values, and includes a
factor of credit risk.
The
carrying amounts of cash and cash equivalents, trade
receivables and accounts payable, as well as amounts included
in other current assets and other current liabilities that
meet the definition of financial instruments, approximate
fair values because of their short-term maturities.
The
carrying values and the estimated fair values of our debt
financial instruments are summarized in the table
below:
There
is no active or observable market for our senior unsecured
notes or our Brazilian Real loan. Therefore, the estimated
fair values of the notes and the loan are based on discounted
cash flows using current interest rates available for debt
with similar terms and remaining maturities. The estimates of
the all-in interest rates for discounting the notes and the
loan are based on a broker quote for notes and a loan with
similar terms. We do not have a rate adjustment for risk
profile changes, covenant issues or credit rating changes,
therefore the broker quote is deemed to be the closest
approximation of current market rates. The carrying value of
the remaining borrowings approximates their fair value due to
their variable interest rates.
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Note 1 - Description of Business and Basis of Presentation | 9 Months Ended |
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Sep. 30, 2011 | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] |
Note 1:
Description of Business and Basis of
Presentation
Description of
Business— John Bean Technologies Corporation and
its consolidated subsidiaries (“JBT Corporation”
or “we”) provide global technology solutions for
the food processing and air transportation industries. We
design, manufacture, test and service technologically
sophisticated systems and products for customers through our
JBT FoodTech and JBT AeroTech segments. We have manufacturing
operations worldwide and are strategically located to
facilitate delivery of our products and services to our
customers.
Basis of
Presentation—The preceding condensed
consolidated balance sheet as of December 31, 2010,
which has been derived from audited financial statements, and
unaudited interim condensed consolidated financial
statements, together with the notes thereto (the
“statements”), of JBT Corporation have been
prepared pursuant to the rules and regulations of the
Securities and Exchange Commission. As permitted under those
rules, certain footnotes and other financial information that
are normally required by accounting principles generally
accepted in the United States can be condensed or omitted.
Therefore, these statements should be read in conjunction
with the audited annual consolidated and combined financial
statements and notes thereto included in our Annual Report on
Form 10-K for the year ended December 31, 2010.
In
the opinion of management, the statements reflect all
adjustments (consisting of normal recurring adjustments)
necessary for a fair presentation of our financial condition
and operating results as of and for the periods presented.
Revenue, expenses, assets and liabilities can vary during
each quarter of the year. Therefore, the results and trends
in these statements may not be representative of those for
the full year or any future period.
Reclassifications—Certain
amounts in prior years’ financial information have been
reclassified to conform to the current year
presentation.
Recently issued
accounting pronouncements—In September 2011, the
Financial Accounting Standards Board (“FASB”)
issued amended guidance that will simplify how entities test
goodwill for impairment. After assessment of certain
qualitative factors, if it is determined to be more likely
than not that the fair value of a reporting unit is less than
its carrying amount, entities must perform the quantitative
analysis of the goodwill impairment test. Otherwise, the
quantitative test(s) becomes optional. The guidance is
effective January 1, 2012 with early adoption permitted. The
company will elect to adopt this guidance for the 2011
goodwill impairment test performed in the fourth
quarter.
In
January 2011, the FASB temporarily deferred the disclosures
regarding troubled debt restructurings which were included in
the disclosure requirements concerning the credit quality of
financing receivables and the allowance for credit losses
which were issued in July 2010. In April 2011, the FASB
issued additional guidance and clarifications to help
creditors in determining whether a creditor has granted a
concession, and whether a debtor is experiencing financial
difficulties for purposes of determining whether a
restructuring constitutes a troubled debt restructuring. The
new guidance and the previously deferred disclosures became
effective July 1, 2011 applied retrospectively to January 1,
2011. Prospective application is required for any new
impairments identified as a result of this guidance. These
changes did not have a material impact on our consolidated
financial statements.
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Note 4 - Stock-based Compensation | 9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
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Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block] |
Note
4: Stock-based Compensation
Stock-based
compensation expense was $1.4 million and $1.9 million for
the three months ended September 30, 2011 and 2010,
respectively, and $4.2 million and $5.4 million for the nine
months ended September 30, 2011 and 2010,
respectively.
In
the nine months ended September 30, 2011, we granted the
following restricted stock awards:
* Assumes
target payout
We
granted time-based restricted stock awards that vest after
three years. The fair value of these time-based awards was
determined using the market value of our common stock on the
grant date. Compensation cost is recognized over the lesser
of the stated vesting period or the period until the employee
reaches age 62, the retirement eligible age under the plan.
We also granted restricted stock awards with
performance-based conditions. The vesting period for these
awards is three years.
For
current year performance-based awards, actual payouts may
vary from zero to 371,164 shares and will be dependent upon
our performance relative to prior year with respect to growth
in earnings and net contribution (which is an economic value
added measure calculated by determining the amount by which
our net income from continuing operations, after adding back
interest expense, exceeds our cost of capital) for the year
ending December 31, 2011. Compensation cost is measured based
on the current expected outcome of the performance conditions
and may be adjusted until the performance period ends.
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Note 5 - Stockholders' Equity | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Stockholders' Equity Note Disclosure [Text Block] |
Note 5:
Stockholders’ Equity
During
the nine months ended September 30, 2011, 0.5 million shares
were issued in connection with our stock-based compensation
plan. During the year ended December 31, 2010, 0.6 million
shares were issued.
Comprehensive
income consisted of the following:
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Note 6 - Earnings Per Share | 9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Text Block] |
Note 6:
Earnings Per Share
Basic
earnings per share (“EPS”) is computed by
dividing net income by the weighted average number of common
shares outstanding for the period. Diluted EPS reflects the
assumed conversion of all dilutive securities.
The
following table sets forth the computation of basic and
diluted EPS from continuing operations for the respective
periods and our basic and dilutive shares outstanding:
|
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