8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

_______________________

Date of Report

(Date of earliest

event reported):                                                   July 31, 2007

              Regal-Beloit Corporation             

(Exact name of registrant as specified in its charter)

Wisconsin	1-7283	39-0875718
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

          200 State Street, Beloit, Wisconsin 53511-6254           

(Address of principal executive offices, including Zip code)

           (608) 364-8800           

(Registrant’s telephone number)

           Not Applicable           

(Former Name or Former Address, if Changed Since Last Report)

_______________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.                Results of Operations and Financial Condition.

On July 31, 2007, Regal Beloit Corporation (the “Company”) issued a news release reporting the financial results of the Company for the financial periods ended June 30, 2007. A copy of the Company’s news release is attached as Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01.                Financial Statements and Exhibits.

(a)   Not Applicable

(b)   Not Applicable

(c)   Not Applicable

(d)   Exhibits.  The following exhibit is being furnished herewith:

99.1 News Release of Regal Beloit Corporation, dated July 31, 2007.

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 by the undersigned hereunto duly authorized.

	REGAL BELOIT CORPORATION
Date:  July 31, 2007	By:	/s/ Paul J. Jones
		Paul J. Jones
		Vice President, General Counsel and Secretary

REGAL BELOIT CORPORATION

Exhibit Index to Report on Form 8-K

Dated July 31, 2007

Exhibit Number	Exhibit Description
99.1	News Release of Regal Beloit Corporation, dated July 31, 2007.

EX-99.1

	NEWS RELEASE
	FOR RELEASE ON OR AFTER:   July 31, 2007
	FOR ADDITIONAL INFORMATION, PLEASE CONTACT:
	David A. Barta Vice President, Chief Financial Officer 608-361-7412
Page 1

REGAL BELOIT REPORTS RECORD RESULTS

ON STRENGTH OF INDUSTRIAL BUSINESS

July 31, 2007 (Beloit, WI):  Regal Beloit Corporation (NYSE:RBC) today reported record financial results for the second quarter ended June 30, 2007.  This performance was lead by the strong performance of our industrial businesses, dampened by the impact of a continuing weak residential HVAC market and commodity inflation.  The Company’s initiatives continued to have a significant impact on our performance. New products and acquisition growth fueled sales, while Lean Six Sigma and productivity projects contributed to operating margins.

Net sales increased 5.6% to $459.8 million from $435.3 million in the second quarter of 2006.  In the Electrical Segment, sales increased 6.1% as non-HVAC motor and generator sales increases of 9.7% and 22.3% respectively, partially offset by a 10.7% decline in residential HVAC revenues. Segment sales growth was also aided by $11.4 million of acquired sales attributed to the Sinya motor business that was purchased on May 1, 2006.  Sales in the Mechanical Segment increased 2.1% from the prior year period; however, second quarter 2006 sales also included $1.7 million of sales related to the Company’s cutting tool business.  Substantially, all of the assets of the Company’s cutting tools business were sold in May, 2006.

The gross profit margin for the second quarter of 2007 was 22.6% as compared to the 23.9% reported for the second quarter of 2006. The reduction was a result of continued increases in material costs and the fixed overhead absorption impact of a $25.5 million reduction in finished goods inventory.  These factors were partially offset by higher selling prices and productivity improvements.

Income from operations was $60.1 million or 13.1% of sales, a 3.8% increase over the $57.9 million or 13.3% of sales reported for the second quarter of 2006.  The results for the second quarter of 2006 included, on a pretax basis, a $1.6 million gain from the sale of excess property.  Costs for the restructuring activities in the Electrical Segment were consistent with the prior year levels.

Net income in the second quarter of 2007 was $36.3 million, an 8.8% increase from $33.3 million reported in the second quarter of 2006.  Diluted earnings per share increased 7.1% to $1.06 as compared to $0.99 for the second quarter of 2006.

“We are pleased to report record results for the second quarter despite a continuation of a challenging residential HVAC market and significant raw material inflation,” commented Henry W. Knueppel, Chairman and CEO, “The strength of the industrial and power generation business coupled with the impact of our strategic initiatives led to this performance.”

Regal Beloit Corporation

News Release

Page 2

“We continue to be very encouraged about the future for our Company.” Knueppel added.“The impact of our global capabilities, energy efficiency oriented new products and other strategic initiatives position us well to continue to provide high levels of return to shareholders.  As we look specifically at the third quarter, we expect continued strength in the industrial and power generation businesses, but little improvement in the residential HVAC market.  The headwind on commodities will actually get worse as the current spike in prices combine with higher hedge prices.  While we are taking pricing actions they will not offset this cost push for the quarter.  We have also embedded in our current estimate a one time pretax charge of $1.8 million or $.033  per share due to the expected settlement of the Enron lawsuit.  As such, we expect earnings per share in the third quarter to be in the range of $.87 to $.93.”

Regal Beloit will be holding a conference call to discuss second quarter financial results at 1:30 PM CT (2:30 PM EDT) today.  Interested parties should call 877-209-9920.  A replay of the call will be available through August 15, 2007 at 800-475-6701, access code 881234.

Regal Beloit Corporation is a leading manufacturer of mechanical and electrical motion control and power generation products serving markets throughout the world.  Regal Beloit is headquartered in Beloit, Wisconsin, and has manufacturing, sales, and service facilities throughout the United States, Canada, Mexico, Europe and Asia.

CAUTIONARY STATEMENT

This news release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995.  Forward-looking statements represent our management’s judgment regarding future events.  In many cases, you can identify forward-looking statements by terminology such as “may,” “will,”  “plan,” “expect,” “anticipate,” “estimate,” “believe,” or “continue” or the negative of these terms or other similar words.  Actual results and events could differ materially and adversely from those contained in the forward-looking statements due to a number of factors, including:

·   unanticipated fluctuations in commodity prices and raw material costs;

·   cyclical downturns affecting the global market for capital goods;

·   economic changes in global markets where we do business, such as currency exchange rates, inflation rates, interest rates, recession, foreign government policies and other external factors that we cannot control;

·   unexpected issues and costs arising from the integration of acquired companies and businesses;

·   actions taken by our competitors;

·   unanticipated costs associated with litigation matters;

·   marketplace acceptance of new and existing products including the loss of, or a decline in business from, any significant customers;

·   the impact of capital market transactions that we may effect;

·   difficulties in staffing and managing foreign operations;

·   the availability and effectiveness of our information technology systems;

·   other risks and uncertainties including but not limited to those described in Item 1A-Risk Factors of  the Company’s Annual Report on Form 10-K filed on February 28, 2007 and from time to time in our reports filed with U.S. Securities and Exchange Commission.

All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the applicable cautionary statements.  The forward-looking statements included in this news release are made only as of their respective dates, and weundertake no obligation to update these statements to reflect subsequent events or circumstances.  See also Item 1A - Risk Factors in the Company’s Annual Report on Form 10-K filed on February 28, 2007.

Regal Beloit Corporation

News Release

Page 3

STATEMENTS OF INCOME

In Thousands of Dollars

	(Unaudited)
	Three Months Ended				Six Months Ended
		June 30,		July 1,		June 30,		July 1,
		2007		2006		2007		2006
Net Sales	$	459,795	$	435,269	$	878,441	$	833,595
Cost of Sales		355,919		331,244		677,338		636,290
Gross Profit		103,876		104,025		201,103		197,305
Operating Expenses		43,821		46,159		93,717		95,821
Income From Operations		60,055		57,866		107,386		101,484
Interest Expense		4,425		5,454		9,491		10,249
Interest Income		241		140		330		260
Income Before Taxes & Minority Interest		55,871		52,552		98,225		91,495
Provision For Income Taxes		18,973		18,847		33,663		33,189
Income Before Minority Interest		36,898		33,705		64,562		58,306
Minority Interest in Income, Net of Tax		645		396		1,496		1,209
Net Income	$	36,253	$	33,309	$	63,066	$	57,097
Earnings Per Share of Common Stock:
Basic	$	1.15	$	1.08	$	2.02	$	1.86
Assuming Dilution	$	1.06	$	0.99	$	1.86	$	1.71
Cash Dividends Declared	$	0.15	$	0.14	$	0.29	$	0.27
Weighted Average Number of Shares Outstanding:
Basic		31,546,970		30,816,156		31,180,641		30,759,004
Assuming Dilution		34,177,529		33,644,909		33,862,524		33,301,719

Regal Beloit Corporation

News Release

Page 4

CONDENSED BALANCE SHEETS

In Thousands of Dollars

ASSETS	(Unaudited)		(Audited)
Current Assets:	June 30, 2007		December 30, 2006
Cash and Cash Equivalents	$	53,136	$	36,520
Receivables and Other Current Assets		325,833		263,470
Inventories		235,848		275,138
Total Current Assets		614,817		575,128
Net Property, Plant and Equipment		274,078		268,880
Goodwill		546,251		546,152
Other Noncurrent Assets		50,890		53,359
Total Assets	$	1,486,036	$	1,443,519
Liabilities and Shareholders’ Investment
Accounts Payable	$	133,592	$	108,050
Commercial Paper Borrowings		9,650		49,000
Other Current Liabilities		118,269		101,491
Long-Term Debt		292,103		323,946
Other Noncurrent Liabilities		117,370		111,057
Shareholders’ Investment		815,052		749,975
Total Liabilities and Shareholders’ Investment	$	1,486,036	$	1,437,519

SEGMENT INFORMATION

In Thousands of Dollars

		(Unaudited)
		Mechanical Segment								Electrical Segment
		Second Quarter Ending				Six Months Ending				Second Quarter Ending				Six Months Ending
		June 30,		July 1,		June 30,		July 1,		June 30,		July 1,		June 30,		July 1,
		2007		2006		2007		2006		2007		2006		2007		2006
Net Sales	$	54,136	$	53,042	$	105,982	$	106,003	$	405,659	$	382,227	$	772,459	$	727,592
Income from Operations		8,954		7,134		15,280		10,841		51,101		50,732		92,106		90,643

Regal Beloit Corporation

News Release

Page 5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

In Thousands of Dollars

	(Unaudited)
	Six Months Ended
CASH FLOWS FROM OPERATING ACTIVITIES:	June 30, 2007			July 1, 2006
Net income	$	63,066		$	57,097
Adjustments to reconcile net income to net cash provided
by operating activities; net of effect of acquisitions
Depreciation and amortization		20,367			16,826
Minority interest		1,496			1,209
Excess tax benefit from stock-based compensation		(6,590	)		(1,750	)
Loss (gain) on sale of assets		51			(1,850	)
Stock-based compensation expense		1,871			1,725
Change in assets and liabilities, net		19,849			(37,027	)
Net cash provided by operating activities		100,110			36,230
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment		(17,863	)		(17,873	)
Purchases of short-term investments, net		-			(10,263	)
Business acquisitions, net of cash acquired		(2,425	)		(10,962	)
Sale of property, plant and equipment		-			15,541
Net cash used in investing activities		(20,288	)		(23,557	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from short-term borrowing		8,200			-
Payments of long-term debt		(278	)		(241	)
Net repayments under revolving credit facility		(31,600	)		(38,600	)
Net (repayments) proceeds from commercial paper borrowings		(39,350	)		20,000
Dividends paid to shareholders		(8,709	)		(7,980	)
Proceeds from the exercise of stock options		1,403			4,239
Excess tax benefits from stock-based compensation		6,590			1,750
Distributions to minority partners		(106	)		-
Financing fees paid		(551	)		-
Net cash used in financing activities		(64,401	)		(20,832	)
EFFECT OF EXCHANGE RATE ON CASH		1,195			(18	)
Net increase (decrease) in cash and cash equivalents		16,616			(8,177	)
Cash and cash equivalents at beginning of period		36,520			32,747
Cash and cash equivalents at end of period	$	53,136		$	24,570