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): October 31, 2011

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)	(Zip Code)

Registrant’s telephone number, including area code: (608) 364-8800

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:

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

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

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

o 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 October 31, 2011, Regal Beloit Corporation (the “Company”) issued a news release reporting the financial results of the Company for the financial period ended October 1, 2011. A copy of the Company’s news release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

Item 7.01 Regulation FD Disclosure.

On November 1, 2011, the Company held a conference call to discuss its financial results for the financial period ended October 1, 2011 and provided a presentation in connection therewith. A copy of the Company’s conference call presentation is furnished as Exhibit 99.2 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 exhibits are being furnished herewith:

99.1	News Release of Regal Beloit Corporation, dated October 31, 2011.
99.2	Regal Beloit Corporation Presentation of November 1, 2011

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: November 1, 2011	By:	/s/ Peter C. Underwood
		Peter C. Underwood
		Vice President, General Counsel and Secretary

2

REGAL BELOIT CORPORATION
Exhibit Index to Report on Form 8-K
Dated October 31, 2011

Exhibit Number		Exhibit Description
	99.1	News Release of Regal Beloit Corporation, dated October 31, 2011.
	99.2	Regal Beloit Corporation presentation of November 1, 2011.

3

EX-99.1

Exhibit 99.1

NEWS RELEASE

FOR ADDITIONAL INFORMATION, PLEASE CONTACT:

     John M. Perino
     Vice President,
     Investor Relations
     608-361-7501

Page 1

REGAL BELOIT REPORTS THIRD QUARTER 2011 FINANCIAL RESULTS

• Record Quarterly Sales of $737 million

• Diluted Earnings Per Share of $1.13

• Adjusted Diluted Earnings Per Share of $1.33*

• Free Cash Flow of 133% of Net Income*

October 31, 2011 (Beloit, WI): Regal Beloit Corporation (NYSE: RBC) today reported financial results for the third quarter ended October 1, 2011. Net sales of $736.9 million increased 24.7% compared to $590.8 million for the third quarter 2010. Diluted earnings per share for the third quarter 2011 were $1.13 compared to $1.14 for the third quarter 2010. Diluted earnings per share for the third quarter 2011 included a gain on a business divestiture and purchase accounting adjustments and transaction costs related to the acquisition of the A.O. Smith Electric Products Company (EPC), as detailed below:

	Three Months
	Ended
	Oct. 1, 2011
GAAP Diluted Earnings Per Share	$	1.13
Gain on Divestiture		(0.10	)
EPC Purchase Accounting Adjustments and Acquisition Costs		0.30
Adjusted Diluted Earnings Per Share	$	1.33

“It was an exciting quarter for Regal Beloit,” commented Mark Gliebe, Chief Executive Officer. “On top of strong overall performance from our operations, we closed on the acquisition of EPC which is the largest acquisition in the Company’s history. Our Commercial and Industrial, Mechanical, International and EPC businesses performed exceptionally well in the quarter offsetting continued weakness in residential HVAC sales. Additionally, our free cash flow for the quarter was well in excess of net income. Overall, we were pleased with our performance in the quarter.”

* This earnings release includes non-GAAP financial measures. Schedules that reconcile these non-GAAP financial measures to the most comparable GAAP figures are included with this earnings release.

Regal Beloit Corporation
News Release
Page 2 of 9

NET SALES

	(Dollars in millions)
	Three Months Ended							Nine Months Ended
	Oct. 1, 2011		Oct. 2, 2010		% Change			Oct. 1, 2011		Oct. 2, 2010		% Change
Net Sales	$	736.9	$	590.8		24.7	%	$	2,081.3	$	1,682.3		23.7	%
Net Sales by Segment:
Electrical segment	$	667.5	$	527.8		26.5	%	$	1,873.0	$	1,507.8		24.2	%
Mechanical segment	$	69.4	$	63.0		10.2	%	$	208.3	$	174.5		19.4	%

Net sales for the third quarter 2011 increased $146.1 million compared to the third quarter 2010 driven primarily by incremental sales from EPC since August 22, 2011 and the other businesses acquired within the last twelve months (the “acquired businesses”).

In the Electrical segment, net sales for the third quarter 2011 increased $139.7 million compared to the third quarter 2010, including $144.5 million of incremental net sales from the acquired businesses. North American residential HVAC net sales, excluding net sales from the acquired businesses, decreased 20.3% in the third quarter 2011 compared to the third quarter 2010, due primarily to reduced federal tax incentives for high efficiency products, the impact of the growth of R22 systems and continued weakness in the housing market. North American commercial and industrial net sales, excluding net sales from the acquired businesses, increased 14.8% in the third quarter 2011 compared to the third quarter 2010, driven primarily by improving economic conditions, sales of new energy efficient products, pricing initiatives to offset commodity inflation, and increased sales in the generator business.

In the Mechanical segment, net sales for the third quarter 2011 increased $6.4 million or 10.2% compared to the third quarter 2010. This increase was driven primarily by improving demand in later cycle end markets.

Net sales to regions outside of the United States were 35.9% of total net sales for the third quarter 2011 compared to 31.0% of total net sales for the third quarter 2010. Third quarter 2011 net sales of high efficiency products were 15.4% of total net sales and increased 0.2% compared to the third quarter 2010. The impact of foreign currency exchange rates increased total net sales by 1.8% for the third quarter 2011 compared to the third quarter 2010.

GROSS PROFIT

	(Dollars in thousands)
	Three Months Ended						Nine Months Ended
	Oct. 1, 2011			Oct. 2, 2010			Oct. 1, 2011			Oct. 2, 2010
Gross Profit	$	179,626		$	144,664		$	495,106		$	419,083
As a percentage of net sales		24.4	%		24.5	%		23.8	%		24.9	%
Gross Profit
Electrical segment	$	160,054		$	127,957		$	435,958		$	370,756
As a percentage of net sales		24.0	%		24.2	%		23.3	%		24.6	%
Mechanical segment	$	19,572		$	16,707		$	59,148		$	48,327
As a percentage of net sales		28.2	%		26.5	%		28.4	%		27.7	%

Regal Beloit Corporation
News Release
Page 3 of 9

Gross profit was $179.6 million, or 24.4% of net sales, for the third quarter 2011 compared to $144.7 million, or 24.5% of net sales, for the third quarter 2010. Cost of sales for the third quarter 2011 included expenses of $10.3 million related to EPC purchase accounting adjustments to inventories. Excluding this expense, adjusted gross profit was $189.9 million, or 25.8% of net sales, for the third quarter 2011. Gross profit was $495.1 million, or 23.8% of net sales, for the nine months ended October 1, 2011 compared to $419.1 million, or 24.9% of net sales, for the nine months ended October 2, 2010. Cost of sales for the nine months ended October 1, 2011 included the $10.3 million of purchase accounting adjustments and $28.0 million of incremental warranty expenses accrued in the second quarter 2011. Excluding these expenses, adjusted gross profit was $533.4 million, or 25.6% of net sales, for the nine months ended October 1, 2011.

OPERATING EXPENSES

	(Dollars in thousands)
	Three Months Ended						Nine Months Ended
	Oct. 1, 2011			Oct. 2, 2010			Oct. 1, 2011			Oct. 2, 2010
Operating Expenses	$	101,482		$	74,781		$	298,033		$	219,636
As a percentage of net sales		13.8	%		12.7	%		14.3	%		13.1	%
Operating Expenses by Segment:
Electrical segment	$	90,680		$	65,919		$	266,158		$	193,541
As a percentage of net sales		13.6	%		12.5	%		14.2	%		12.8	%
Mechanical segment	$	10,802		$	8,862		$	31,875		$	26,095
As a percentage of net sales		15.6	%		14.1	%		15.3	%		15.0	%

INCOME FROM OPERATIONS

	(Dollars in thousands)
	Three Months Ended						Nine Months Ended
	Oct. 1, 2011			Oct. 2, 2010			Oct. 1, 2011			Oct. 2, 2010
Income from Operations	$	78,144		$	69,883		$	197,073		$	199,447
As a percentage of net sales		10.6	%		11.8	%		9.5	%		11.9	%
Income from Operations by Segment:
Electrical segment	$	69,375		$	62,038		$	169,800		$	177,215
As a percentage of net sales		10.4	%		11.8	%		9.1	%		11.8	%
Mechanical segment	$	8,769		$	7,845		$	27,273		$	22,232
As a percentage of net sales		12.6	%		12.4	%		13.1	%		12.7	%

Operating expenses for the third quarter 2011 increased $26.7 million primarily due to $21.9 million related to the acquired businesses, and an incremental $5.6 million of acquisition-related expenses.

Net interest expense for the third quarter 2011 increased $5.9 million compared to the third quarter 2010 primarily due to interest on additional borrowings incurred to finance the EPC acquisition. The effective tax rate for the third quarter 2011 was 30.3%, consistent with the third quarter 2010.

Net income attributable to Regal Beloit Corporation for the third quarter 2011 was $45.7 million compared to $44.7 million for the third quarter 2010. Diluted earnings per share for the third quarter 2011 were $1.13 compared to $1.14 for the third quarter 2010.

Net cash provided by operating activities was $66.7 million for the third quarter 2011 as compared to $48.9 million for the third quarter 2010. Capital expenditures were $5.9 million for the third quarter 2011.

Regal Beloit Corporation
News Release
Page 4 of 9

“As we look forward to the fourth quarter,” commented Mr. Gliebe, “we are expecting continued strength in our C&I, Mechanical and India based businesses. However, we also expect further weakness in residential HVAC demand and a general slowdown in our China based businesses. Accordingly, we are projecting fourth quarter adjusted diluted earnings per share of $0.67 to $0.73, which excludes purchase accounting adjustments related to the acquisition of EPC, which we anticipate will be approximately $0.25 per share. I am pleased with the performance and progress we are making in 2011,” added Gliebe. “We enter the fourth quarter with real momentum from the largest acquisition in the Company’s history. Despite challenges in a few end markets, we continue to grow the Company, improve our performance and position Regal Beloit for continued success.”

Regal Beloit will hold a conference call pertaining to this news release at 10:00 AM CDT (11:00 AM EDT) on Tuesday, November 1, 2011. To listen to the call and view the presentation slides via the internet, please go http://www.regalbeloit.com/ or at: http://www.videonewswire.com/event.asp?id=83183. Individuals who would like to participate by phone should dial 866-524-3160, referencing Regal Beloit. International callers should dial 412-317-6760, referencing Regal Beloit.

A telephone replay of the call will be available through February 1, 2012, at 877-344-7529, conference ID 10005959. International callers should call 412-317-0088 using the same conference ID. A webcast replay will be available until February 1, 2012, and can be accessed at http://www.regalbeloit.com/rbceventspresentations.htm or at http://www.videonewswire.com/event.asp?id=83183.

Regal Beloit Corporation is a leading manufacturer of electric motors, mechanical and electrical motion controls 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. Regal Beloit’s common stock is a component of the S&P Mid Cap 400 Index and the Russell 2000 Index.

Regal Beloit Corporation
News Release
Page 5 of 9

CAUTIONARY STATEMENT

The following is a cautionary statement made under the Private Securities Litigation Reform Act of 1995: With the exception of historical facts, the statements contained in this press release may be forward looking statements. 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: actions taken by our competitors and our ability to effectively compete in the increasingly competitive global electric motor, power generation and mechanical motion control industries; our ability to develop new products based on technological innovation and the marketplace acceptance of new and existing products; fluctuations in commodity prices and raw material costs; our dependence on significant customers; issues and costs arising from the integration of acquired companies and businesses, including the timing and impact of purchase accounting adjustments; unanticipated costs or expenses we may incur related to product warranty issues; our dependence on key suppliers and the potential effects of supply disruptions; infringement of our intellectual property by third parties, challenges to our intellectual property, and claims of infringement by us of third party technologies; increases in our overall debt levels as a result of acquisitions or otherwise and our ability to repay principal and interest on our outstanding debt; product liability and other litigation, or the failure of our products to perform as anticipated, particularly in high volume applications; economic changes in global markets where we do business, such as reduced demand for the products we sell, currency exchange rates, inflation rates, interest rates, recession, foreign government policies and other external factors that we cannot control; unanticipated liabilities of acquired businesses; cyclical downturns affecting the global market for capital goods; difficulties associated with managing foreign operations; and 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 March 2, 2011 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 presentation are made only as of their respective dates, and we undertake no obligation to update these statements to reflect subsequent events or circumstances.

Regal Beloit Corporation
News Release
Page 6 of 9

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

Unaudited
Dollars in Thousands, Except Dividends Declared and Per Share Data

	Three Months Ended				Nine Months Ended
	Oct. 1, 2011		Oct. 2, 2010		Oct. 1, 2011		Oct. 2, 2010
Net Sales	$	736,885	$	590,801	$	2,081,325	$	1,682,300
Cost of Sales		557,259		446,137		1,586,219		1,263,217
Gross Profit		179,626		144,664		495,106		419,083
Operating Expenses		101,482		74,781		298,033		219,636
Income From Operations		78,144		69,883		197,073		199,447
Interest Expense		10,482		4,817		20,387		14,358
Interest Income		450		645		1,186		1,800
Income Before Taxes & Noncontrolling Interests		68,112		65,711		177,872		186,889
Provision For Income Taxes		20,618		19,831		53,570		58,366
Net Income		47,494		45,880		124,302		128,523
Less: Net Income Attributable to Noncontrolling Interests, net of tax		1,823		1,226		5,464		4,387
Net Income Attributable to Regal Beloit Corporation	$	45,671	$	44,654	$	118,838	$	124,136
Earnings Per Share of Common Stock:
Basic	$	1.14	$	1.16	$	3.04	$	3.26
Assuming Dilution	$	1.13	$	1.14	$	3.00	$	3.19
Cash Dividends Declared	$	0.18	$	0.17	$	0.53	$	0.50
Weighted Average Number of Shares Outstanding:
Basic		39,931,610		38,581,166		39,075,118		38,112,515
Assuming Dilution		40,421,659		39,023,135		39,648,485		38,875,978

SEGMENT INFORMATION

Unaudited
Dollars in Thousands

	Mechanical Segment				Electrical Segment
	Three Months Ended				Three Months Ended
	October 1, 2011		October 2, 2010		October 1, 2011		October 2, 2010
Net Sales	$	69,435	$	63,012	$	667,450	$	527,789
Income from Operations		8,769		7,845		69,375		62,038

	Mechanical Segment				Electrical Segment
	Nine Months Ended				Nine Months Ended
	October 1, 2011		October 2, 2010		October 1, 2011		October 2, 2010
Net Sales	$	208,271	$	174,476	$	1,873,054	$	1,507,824
Income from Operations		27,273		22,232		169,800		177,215

Regal Beloit Corporation
News Release
Page 7 of 9

CONDENSED CONSOLIDATED BALANCE SHEETS

Dollars in Thousands

	(Unaudited)
	October 1, 2011		January 1, 2011
ASSETS
Current Assets:
Cash and Investments	$	124,414	$	230,858
Trade Receivables, less Allowances of $9,331 in 2011 and $10,637 in 2010		498,745		331,017
Inventories		626,857		390,587
Prepaid Expenses and Other Current Assets		140,101		135,589
Total Current Assets		1,390,117		1,088,051
Property, Plant, Equipment and Noncurrent Assets		1,986,061		1,361,085
Total Assets	$	3,376,178	$	2,449,136
LIABILITIES AND EQUITY
Current Liabilities:
Accounts Payable	$	308,855	$	231,705
Other Accrued Expenses		273,779		159,000
Current Maturities of Debt		13,278		8,637
Total Current Liabilities		595,912		399,342
Long-Term Debt		955,147		428,256
Other Noncurrent Liabilities		267,605		224,376
Equity:
Total Regal Beloit Corporation Shareholders’ Equity		1,517,434		1,361,960
Noncontrolling Interests		40,080		35,202
Total Equity		1,557,514		1,397,162
Total Liabilities and Equity	$	3,376,178	$	2,449,136

Regal Beloit Corporation
News Release
Page 8 of 9

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
Unaudited
Dollars in Thousands

	Three Months Ended						Nine Months Ended
	Oct. 1,			Oct. 2,			Oct. 1,			Oct. 2,
	2011			2010			2011			2010
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	47,494		$	45,880		$	124,302		$	128,523
Adjustments to reconcile net income to net cash provided by operating activities (net of acquisitions):
Depreciation and amortization		26,084			18,390			69,710			54,289
Excess tax benefits from stock-based compensation		(37	)		(170	)		(1,040	)		(1,581	)
(Gain) Loss on disposition of assets		(6,101	)		3,083			(5,613	)		4,451
Stock-based compensation expense		3,933			1,903			10,168			4,968
Change in assets and liabilities		(4,683	)		(20,226	)		(21,261	)		(42,063	)
Net cash provided by operating activities		66,690			48,860			176,266			148,587
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment		(5,864	)		(11,757	)		(44,389	)		(29,989	)
Purchases of investment securities		—			(125,292	)		—			(313,169	)
Sales of investment securities		—			105,223			55,998			236,752
Business acquisitions, net of cash acquired		(742,809	)		(31,395	)		(764,862	)		(107,258	)
Sale of assets		14,904			41			15,113			108
Net cash used in investing activities		(733,769	)		(63,180	)		(738,140	)		(213,556	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of convertible debt		—			(470	)		—			(39,198	)
Net borrowings (repayments) under revolving credit facility		—			—						(2,863	)
Borrowings under revolving credit facility		200,000						200,000
Repayments under revolving credit facility		(172,000	)					(172,000	)
Proceeds from short-term borrowings		938			—			21,446			—
Repayments of short-term borrowings		(1,874	)		(406	)		(17,264	)		(9,139	)
Proceeds from long-term borrowings		500,000			—			500,000			—
Payments of long-term debt		(27	)		(35	)		(115	)		(138	)
Dividends paid to shareholders		(6,962	)		(6,556	)		(20,092	)		(18,534	)
Proceeds from the exercise of stock options		100			556			1,856			3,545
Excess tax benefits from stock-based compensation		37			170			1,040			1,581
Financing fees paid		(902	)		—			(2,776	)		—
Net cash provided by (used in) financing activities		519,310			(6,741	)		512,095			(64,746	)
EFFECT OF EXCHANGE RATES ON CASH		(3,165	)		2,639			(338	)		1,373
Net decrease in cash and cash equivalents		(150,934	)		(18,422	)		(50,117	)		(128,342	)
Cash and cash equivalents at beginning of period		275,348			152,502			174,531			262,422
Cash and cash equivalents at end of period	$	124,414		$	134,080		$	124,414		$	134,080

Regal Beloit Corporation
News Release
Page 9 of 9

NON-GAAP MEASURES
Unaudited
Dollars in Thousands, Except Per Share Data

Regal Beloit Corporation prepares financial statements in accordance with accounting principles generally accepted in the United States (GAAP). Regal Beloit Corporation also discloses adjusted diluted earnings per share (EPS), adjusted gross profit, adjusted gross profit as a percentage of net sales and free cash flow, which are non-GAAP financial measures. Management uses these measures in its internal performance reporting and for reports to the Board of Directors. Regal Beloit Corporation also discloses these measures in its quarterly earnings releases, on investor conference calls, and in investor presentations and similar events. Management believes that adjusted diluted EPS, adjusted gross profit, adjusted gross profit as a percentage of net sales and free cash flow are useful measures for providing investors with additional insight into the Company’s operating performance. This additional information is not meant to be considered in isolation or as a substitute for Regal Beloit Corporation’s results of operations prepared and presented in accordance with GAAP.

Adjusted diluted earnings per share, adjusted gross profit and adjusted gross profit as a percentage of net sales exclude the effects of certain items that are not comparable from one period to the next. Free cash flow is defined as net cash provided by operating activities less additions to property, plant and equipment.

	Three Months			Nine Months
	Ended			Ended
	Oct. 1, 2011			Oct. 1, 2011
GAAP Diluted Earnings Per Share	$	1.13		$	3.00
Gain on Divestiture		(0.10	)		(0.10	)
EPC Purchase Accounting Adjustments and Acquisition Costs		0.30			0.30
Incremental Warranty Accrual		—			0.44
Adjusted Diluted Earnings Per Share	$	1.33		$	3.64
GAAP Gross Profit	$	179,626		$	495,106
EPC Purchase Accounting Adjustment		10,305			10,305
Incremental Warranty Accrual		—			28,000
Adjusted Gross Profit	$	189,931		$	533,411
Adjusted Gross Profit as a Percentage of Net Sales		25.8	%		25.6	%
GAAP Net Cash Provided by Operating Activities	$	66,690		$	176,266
Additions to Property Plant and Equipment		(5,864	)		(44,389	)
Free Cash Flow	$	60,826		$	131,877

EX-99.2

Exhibit 99.2
 

Jonathan J. Schlemmer Chief Operating Officer Chuck Hinrichs Vice President Chief Financial Officer Mark J. Gliebe President and Chief Executive Officer John M. Perino Vice President Investor Relations

Safe Harbor Statement This presentation 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: actions taken by our competitors and our ability to effectively compete in the increasingly competitive global electric motor, power generation and mechanical motion control industries; our ability to develop new products based on technological innovation and the marketplace acceptance of new and existing products; fluctuations in commodity prices and raw material costs; our dependence on significant customers; issues and costs arising from the integration of acquired companies and businesses, including the timing and impact of purchase accounting adjustments; our dependence on key suppliers and the potential effects of supply disruptions; infringement of our intellectual property by third parties, challenges to our intellectual property, and claims of infringement by us of third party technologies; increases in our overall debt levels as a result of acquisitions or otherwise and our ability to repay principal and interest on our outstanding debt; product liability and other litigation, or the failure of our products to perform as anticipated, particularly in high volume applications; unanticipated costs or expenses we may incur related to product warranty issues; economic changes in global markets where we do business, such as reduced demand for the products we sell, currency exchange rates, inflation rates, interest rates, recession, foreign government policies and other external factors that we cannot control; unanticipated liabilities of acquired businesses; cyclical downturns affecting the global market for capital goods; difficulties associated with managing foreign operations; and 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 March 2, 2011 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 presentation are made only as of their respective dates, and we undertake no obligation to update these statements to reflect subsequent events or circumstances. 1

Non-GAAP Financial Measures 2 We prepare financial statements in accordance with accounting principles generally accepted in the United States (GAAP). We also disclose adjusted diluted earnings per share (EPS), adjusted gross profit, adjusted gross profit as a percentage of net sales, and free cash flow which are non-GAAP financial measures. We use these measures in our internal performance reporting and for reports to the Board of Directors. We also disclose these measures in our quarterly earnings releases, on investor conference calls, and in investor presentations and similar events. We believe that adjusted diluted EPS, adjusted gross profit, adjusted gross profit as a percentage of net sales and free cash flow are useful measures for providing investors with additional insight into our operating performance. This additional information is not meant to be considered in isolation or as a substitute for our results of operations prepared and presented in accordance with GAAP. Adjusted diluted earnings per share, adjusted gross profit and adjusted gross profit as a percentage of net sales exclude the effects of certain items that are not comparable from one period to the next. Free cash flow is defined as net cash provided by operating activities less additions to property, plant and equipment. e

Agenda 3 Mark Gliebe, CEO - Opening Comments Chuck Hinrichs, CFO - Financial Update Jon Schlemmer, COO - Products, Markets & Operations Update Mark Gliebe - 2nd Quarter Outlook & Current View of EPC Transaction Questions & Answers Mark Gliebe - Closing Comments Mark Gliebe, CEO - Opening Comments Chuck Hinrichs, CFO - Financial Update Jon Schlemmer, COO -Operations Update Mark Gliebe - Summary Comments Questions & Answers Close

Opening Comments 4 Solid 3rd Quarter Results - Adjusted EPS Exceeded Guidance EPC - Meeting / Exceeding Expectations Record Quarterly Sales, Adjusted EPS and Cash Flow Strength in C&I, Mechanical, International and EPC Continued Weakness in HVAC Free Cash Flow 133% of Net Income Acquisition Pipeline Remains Active

Quarter Highlights 5 Closing of EPC Acquisition Strength in C&I, Mechanical, International and EPC Businesses Strong Free Cash Flow Continued Energy Efficient Product Introductions Pricing and Productivity Offset Inflation in Quarter

Quarter Highlights 6 3Q11 GAAP Diluted EPS $ 1.13 Gain on Divestiture of Pool & Spa (0.10) EPC PAA and Acquisition Costs 0.30* 3Q11 Adjusted Diluted EPS $ 1.33 * Includes: Inventory Purchase Accounting Adj. $10.3 million ($0.18 EPS) Acquisition Costs of $5.8 million ($0.10 EPS) Incremental D&A of $1.3 million ($0.02 EPS)

Quarter Highlights 7 EPC and C&I Outperformed Expectations + Stronger Sales Implemented Cost and Spending Controls Foreign Currency Gains + Commodity Costs + HVAC Sales -

(CHART) 8 Sales Growth - Up 24.7% Key Drivers EPC and the other acquired businesses Price F/X Benefit of 1.8% Financial Highlights Adj. Gross Profit - Up 140bps Price and Productivity Gains Covered Cost Inflation Included $10.3 million of Inventory PAA Includes Acquisition Synergies Free Cash Flow $61.5 million 133% of Net Income Focused on FCF for Debt Reduction

Fourth Quarter 2011 Guidance Adjusted EPS Guidance of $0.67 to $0.73 Includes EPC Operating Results Excludes $15 million ($0.25 EPS) of Inventory PAA at EPC Lower Sales Volume Impacted By: Continued Weak HVAC China Slowing EPC Seasonality Commodity Costs Moderating 9

Operations Update - Sales 10 North American C&I Up 15% Global Generators Up 31% Mechanical Sales Up 10% Sales Outside US Up 44% NA Residential HVAC Sales decreased 20%

Operations Update - New Products 11 Energy Efficient Sales 15% of Sales Launched 12 New Products In Q3 On Track for 50 New Product Introductions in 2011

New Products - Air Moving 12 E-Star Water Heater Blower Used By OEM's To Create Energy Star Rated Gravity Vent Water Heaters Increases Water Heater Efficiency By 17% Increases Hot Water Output

13 New Products - Ventilation Bath Ventilation Motor Rotor With Low Cost Ferrite Magnets Variable Speed Control Air Flow and Time Delay Up To 75% Less Power Used and Quiet Operation

Operations Update 14 EPC Integration Management Talent Customer Focus Accelerating Cost Synergy Realization Identifying Cross Selling Opportunities Meeting / Exceeding Acquisition Targets

Summary 15 EPC Integration Progressing Very Well Pricing Initiatives Offset Current Commodity Inflation New Product Introductions Continue to Provide Exciting Solutions for Our Customers 4th Quarter Guidance Reflects Strength in Most Businesses Continuing to Generate Strong Free Cash Flow

16 Questions and Answers

APPENDIX - Non GAAP Measures 17

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