EX-99.1 2 y37332exv99w1.htm EX-99.1: PRESS RELEASE EX-99.1
 

(DOVER CORPORATION)
EXHIBIT 99.1
     
CONTACT:   READ IT ON THE WEB
Robert G. Kuhbach   www.dovercorporation.com
Vice President Finance &    
Chief Financial Officer    
(212) 922-1640   July 25, 2007
DOVER REPORTS RECORD SECOND QUARTER 2007 RESULTS
New York, New York, July 25, 2007 — Dover Corporation (NYSE: DOV) announced today that for the second quarter ended June 30, 2007, it had earnings from continuing operations of $175.1 million or $0.85 diluted earnings per share (“EPS”), compared to $158.8 million or $0.77 EPS from continuing operations in the prior-year period, both representing increases of 10%. Revenue for the second quarter of 2007 was $1.859 billion, an increase of 12% over the prior-year period.
Earnings from continuing operations for the six months ended June 30, 2007 were $314.0 million or $1.52 EPS, compared to $290.1 million or $1.41 EPS in the prior-year period, both representing increases of 8%. Revenue for the six month period ended June 30, 2007 was $3.639 billion, up 15% over the prior year period.
Commenting on the second quarter results, Dover’s President and Chief Executive Officer, Ronald L. Hoffman, stated: “We are pleased to report another record-setting quarter at Dover. We set all-time quarterly records with earnings from continuing operations of $175 million, diluted earnings per share of $0.85 and revenue of $1.9 billion. Continuing earnings increased 10% over the second quarter of 2006 while revenue was up 12% over the same period. Additionally, bookings for the quarter were a record $1.9 billion, a 17% increase over the comparable period of 2006 and we ended the quarter with a record backlog of $1.6 billion.”
Mr. Hoffman continued, “Our second quarter performance primarily reflected earnings contributions from acquisitions in Material Handling and Product Identification and strength in the Process Equipment, Mobile Equipment and Oil & Gas Equipment Groups, which more than offset weakness in the Automation & Measurement Group. Sequentially, all segments showed improvement in earnings and sales and all had positive leverage, with operating margins up 200 basis points to 15.0%. Our PerformanceCOUNTS program continues to drive world class performance across our operating companies, as we hit four out of five target metrics for the second quarter. Further evidence of our operational focus can be found in our free cash flow generation of $218 million in the second quarter which was 11.7% of revenue, bringing the six month free cash flow total to $235 million, or 6.5% of revenue.
“Looking forward to the third quarter, we expect moderate growth in organic revenue and earnings assuming the global economy stays healthy, and a modest improvement in the A & M Group. Taking into account the earnings contributions of 2006 acquisitions and a strong performance in most of our industrial markets, we anticipate that the third quarter will be another record-setting quarter.
“The remainder of the year will be an exciting time at Dover. Late in the third quarter we will announce a new organizational structure which better aligns Dover’s operating companies with broadly served markets,

 

2

enhances our strategic acquisition focus and increases our shareholder transparency. We will also continue to be highly disciplined in our acquisition activity to ensure our capital is allocated in an efficient manner. While we didn’t close on any acquisitions in the second quarter, we did repurchase 1 million shares during that timeframe, bringing our year-to-date total to 1.5 million shares. Finally, I’d like to thank our dedicated employees around the world for producing a great quarter in the face of a dynamic and competitive market.”
Net earnings for the second quarter of 2007 were $172.2 million or $0.84 EPS, including a loss from discontinued operations of $2.9 million or $0.01 EPS, compared to net earnings of $71.9 million or $0.35 EPS for the same period of 2006, which included a loss from discontinued operations of $86.8 million or $0.42 EPS. Net earnings for the six months ended June 30, 2007 were $301.1 million or $1.46 EPS, including a loss from discontinued operations of $12.8 million or $0.06 EPS, compared to net earnings of $275.7 million or $1.34 EPS for the same period of 2006, which included a loss from discontinued operations of $14.3 million or $0.07 EPS.
Dover will host a webcast of its second quarter 2007 conference call at 8:00 AM Eastern Time on Wednesday, July 25, 2007. The webcast can be accessed at the Dover Corporation website at www.dovercorporation.com. The conference call will also be made available for replay on the website and additional information on Dover’s second quarter 2007 results and its operating companies can also be found on the Company website and in the Company’s Form 10-Q filed after this release.
Dover Corporation makes information available to the public, orally and in writing, which may use words like “anticipates,” “expects,” “believes,” “indicates,” “suggests,” “will,” “plans” and “should,” which are “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. This press release contains forward-looking statements concerning future events and the performance of Dover Corporation that involve inherent risks and uncertainties that could cause actual results to differ materially from current expectations, including, but not limited to, failure to achieve expected synergies, the impact of continued events in the Middle East on the worldwide economy, economic conditions, increases in the cost of raw materials, changes in customer demand, increased competition in the markets served by Dover Corporation’s operating companies, the impact of natural disasters, such as hurricanes, and their effect on global energy markets and other risks. Dover Corporation refers you to the documents that it files from time to time with the Securities and Exchange Commission, such as its reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other risks and uncertainties that could cause its actual results to differ materially from its current expectations and from the forward-looking statements contained in this press release. Dover Corporation undertakes no obligation to update any forward-looking statement.
TABLES FOLLOW

 

DOVER CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited) (in thousands, except per share figures)
                                 
    Three Months Ended June 30,     Six Months Ended June 30,  
    2007     2006     2007     2006  
Revenue
   $ 1,858,965     $ 1,660,341     $ 3,639,152     $ 3,170,554  
Cost of goods and services
     1,191,792       1,045,397       2,336,068       2,007,701  
 
                        
Gross profit
     667,173       614,944       1,303,084       1,162,853  
Selling and administrative expenses
     404,765       366,126       825,196       701,626  
 
                        
Operating earnings
     262,408       248,818       477,888       461,227  
 
                        
Interest expense, net
     22,444       19,247       44,284       40,732  
Other expense (income), net
     147       4,113       (137 )     6,935  
 
                        
Total interest/other expense, net
     22,591       23,360       44,147       47,667  
 
                        
Earnings before provision for income taxes and discontinued operations
     239,817       225,458       433,741       413,560  
Provision for income taxes
     64,690       66,699       119,770       123,510  
 
                        
Earnings from continuing operations
     175,127       158,759       313,971       290,050  
 
                        
Loss from discontinued operations, net
     (2,933 )     (86,848 )     (12,846 )     (14,313 )
 
                        
Net earnings
   $ 172,194     $ 71,911     $ 301,125     $ 275,737  
 
                        
 
                                
Basic earnings (loss) per common share:
                                
Earnings from continuing operations
   $ 0.86     $ 0.78     $ 1.54     $ 1.42  
Loss from discontinued operations, net
     (0.01 )     (0.43 )     (0.06 )     (0.07 )
Net earnings
     0.84       0.35       1.47       1.35  
 
                                
Weighted average shares outstanding
     204,431       203,897       204,446       203,602  
 
                        
 
                                
Diluted earnings (loss) per common share:
                                
Earnings from continuing operations
   $ 0.85     $ 0.77     $ 1.52     $ 1.41  
Loss from discontinued operations, net
     (0.01 )     (0.42 )     (0.06 )     (0.07 )
Net earnings
     0.84       0.35       1.46       1.34  
 
                                
Weighted average shares outstanding
     206,145       205,615       206,155       205,234  
 
                        
 
                                
Dividends paid per common share
   $ 0.185     $ 0.170     $ 0.370     $ 0.340  
 
                        
The following table is a reconciliation of the share amounts used in computing earnings per share:
                                 
    Three Months Ended June 30,     Six Months Ended June 30,  
    2007     2006     2007     2006  
Weighted average shares outstanding — Basic
     204,431       203,897       204,446       203,602  
Dilutive effect of assumed exercise of employee stock options
     1,714       1,718       1,709       1,632  
 
                        
 
                                
Weighted average shares outstanding — Diluted
     206,145       205,615       206,155       205,234  
 
                        
 
                                
Anti-dilutive shares excluded from diluted EPS computation
     3,403       1,875       3,403       6,141  

 

 

DOVER CORPORATION
MARKET SEGMENT INFORMATION
(unaudited) (In thousands)
                                                                         
    2006   2007
                    Q2                                           Q2
    Q1   Q2   YTD   Q3   Q4   YTD   Q1   Q2   YTD
         
REVENUE
                                                                        
Diversified
     193,677       202,358       396,035       191,755       190,336       778,126       215,004       218,945       433,949  
Electronics
     199,495       222,751       422,246       225,469       232,969       880,684       222,418       234,724       457,142  
Industries
     218,742       226,072       444,814       233,744       242,311       920,869       230,461       239,595       470,056  
Resources
     425,162       435,341       860,503       463,853       517,135       1,841,491       551,979       561,946       1,113,925  
Systems
     181,285       234,124       415,409       217,543       201,902       834,854       205,583       220,997       426,580  
Technologies
     294,941       343,367       638,308       330,768       344,469       1,313,545       358,538       386,642       745,180  
Intramarket eliminations
     (3,089 )     (3,672 )     (6,761 )     (3,453 )     (3,356 )     (13,570 )     (3,796 )     (3,884 )     (7,680 )
         
Total consolidated revenue
     1,510,213       1,660,341       3,170,554       1,659,679       1,725,766       6,555,999       1,780,187       1,858,965       3,639,152  
         
 
                                                                        
NET EARNINGS
                                                                        
Segment Earnings:
                                                                        
Diversified
     22,584       23,384       45,968       24,308       19,779       90,055       26,968       28,739       55,707  
Electronics
     20,754       29,862       50,616       31,618       37,191       119,425       23,838       27,792       51,630  
Industries
     27,328       30,208       57,536       31,389       35,057       123,982       30,837       38,428       69,265  
Resources
     82,797       80,919       163,716       76,641       75,971       316,328       93,812       97,137       190,949  
Systems
     26,972       38,341       65,313       24,920       23,880       114,113       26,576       34,129       60,705  
Technologies
     47,712       60,684       108,396       52,257       46,075       206,728       29,924       53,119       83,043  
         
Total segments
     228,147       263,398       491,545       241,133       237,953       970,631       231,955       279,344       511,299  
Corporate expense / other
     (18,560 )     (18,693 )     (37,253 )     (16,351 )     (17,174 )     (70,778 )     (16,191 )     (17,083 )     (33,274 )
Net interest expense
     (21,485 )     (19,247 )     (40,732 )     (17,184 )     (19,068 )     (76,984 )     (21,840 )     (22,444 )     (44,284 )
         
Earnings from continuing operations before provision for income taxes
     188,102       225,458       413,560       207,598       201,711       822,869       193,924       239,817       433,741  
Provision for income taxes
     56,811       66,699       123,510       50,455       45,575       219,541       55,080       64,690       119,770  
         
Earnings from continuing operations
     131,291       158,759       290,050       157,143       156,135       603,328       138,844       175,127       313,971  
Earnings (loss) from discontinued operations, net
     72,535       (86,848 )     (14,313 )     10,382       (37,615 )     (41,546 )     (9,913 )     (2,933 )     (12,846 )
         
Net earnings
     203,826       71,911       275,737       167,525       118,520       561,782       128,931       172,194       301,125  
         
 
                                                                        
SEGMENT OPERATING MARGIN
                                                                        
Diversified
     11.7 %     11.6 %     11.6 %     12.7 %     10.4 %     11.6 %     12.5 %     13.1 %     12.8 %
Electronics
     10.4 %     13.4 %     12.0 %     14.0 %     16.0 %     13.6 %     10.7 %     11.8 %     11.3 %
Industries
     12.5 %     13.4 %     12.9 %     13.4 %     14.5 %     13.5 %     13.4 %     16.0 %     14.7 %
Resources
     19.5 %     18.6 %     19.0 %     16.5 %     14.7 %     17.2 %     17.0 %     17.3 %     17.1 %
Systems
     14.9 %     16.4 %     15.7 %     11.5 %     11.8 %     13.7 %     12.9 %     15.4 %     14.2 %
Technologies
     16.2 %     17.7 %     17.0 %     15.8 %     13.4 %     15.7 %     8.3 %     13.7 %     11.1 %

 

 

QUARTERLY EPS & EARNINGS
(unaudited) (in thousands)
                                                 
    2006                           2007    
    1 Qtr.   2 Qtr.   3 Qtr.   4 Qtr.   1 Qtr.   2 Qtr.
Basic earnings (loss) per common share:
                                                
Continuing operations
   $ 0.65     $ 0.78     $ 0.77     $ 0.76     $ 0.68     $ 0.86  
Discontinued operations
     0.36       (0.43 )     0.05       (0.18 )     (0.05 )     (0.01 )
Net earnings
     1.00       0.35       0.82       0.58       0.63       0.84  
 
                                                
Diluted earnings (loss) per common share:
                                                
Continuing operations
   $ 0.64     $ 0.77     $ 0.77     $ 0.76     $ 0.67     $ 0.85  
Discontinued operations
     0.35       (0.42 )     0.05       (0.18 )     (0.05 )     (0.01 )
Net earnings
     0.99       0.35       0.82       0.58       0.63       0.84  
DOVER CORPORATION
MARKET SEGMENT INFORMATION
(unaudited) (in thousands)
                                                                         
    2006   2007
                    Q2                   Q4                   Q2
    Q1   Q2   YTD   Q3   Q4   YTD   Q1   Q2   YTD
    2006   2007
BOOKINGS
                                                                        
Diversified
   $ 208,245     $ 210,061     $ 418,306     $ 199,207     $ 213,243     $ 830,756     $ 219,406     $ 222,307     $ 441,713  
Electronics
     223,559       219,784       443,343       231,527       213,374       888,244       218,954       240,850       459,804  
Industries
     219,424       232,185       451,609       251,017       236,523       939,149       296,526       277,057       573,583  
Resources
     454,669       441,761       896,430       471,625       505,186       1,873,241       577,533       555,588       1,133,121  
Systems
     231,036       229,633       460,669       210,132       171,112       841,913       235,079       246,512       481,591  
Technologies
     339,124       325,101       664,225       307,885       325,609       1,297,719       361,759       392,117       753,876  
BOOK-TO-BILL
                                                                        
Diversified
     1.08       1.04       1.06       1.04       1.12       1.07       1.02       1.02       1.02  
Electronics
     1.12       0.99       1.05       1.03       0.92       1.01       0.98       1.03       1.01  
Industries
     1.00       1.03       1.02       1.07       0.98       1.02       1.29       1.16       1.22  
Resources
     1.07       1.01       1.04       1.02       0.98       1.02       1.05       0.99       1.02  
Systems
     1.27       0.98       1.11       0.97       0.85       1.01       1.14       1.12       1.13  
Technologies
     1.15       0.95       1.04       0.93       0.95       0.99       1.01       1.01       1.01  
BACKLOG
                                                                        
Diversified
   $ 317,750     $ 323,567             $ 334,638     $ 358,385             $ 358,118     $ 371,818          
Electronics
     165,253       163,182               169,151       150,143               184,260       190,318          
Industries
     234,174       251,301               282,234       288,835               360,037       398,682          
Resources
     196,379       203,757               249,040       237,987               262,845       258,095          
Systems
     223,843       218,360               211,939       181,530               210,850       236,683          
Technologies
     147,984       141,526               123,416       125,929               130,062       136,558