-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GYx7L2AhGdZ73UMfGzKkj6+Q0cB6QfCDYVuFUAlsAjYJNhUmgg9U7uBlEs6s+kPM t8K0M9eijNhs7lxWbzQrdA== 0001157523-07-001297.txt : 20070208 0001157523-07-001297.hdr.sgml : 20070208 20070208160228 ACCESSION NUMBER: 0001157523-07-001297 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20070206 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070208 DATE AS OF CHANGE: 20070208 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BADGER METER INC CENTRAL INDEX KEY: 0000009092 STANDARD INDUSTRIAL CLASSIFICATION: TOTALIZING FLUID METERS & COUNTING DEVICES [3824] IRS NUMBER: 390143280 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-06706 FILM NUMBER: 07592652 BUSINESS ADDRESS: STREET 1: 4545 WEST BROWN DEER ROAD CITY: MILWAUKEE STATE: WI ZIP: 53223 BUSINESS PHONE: 4143715702 MAIL ADDRESS: STREET 1: 4545 W BROWN DEER RD CITY: MILWAUKEE STATE: WI ZIP: 53223 FORMER COMPANY: FORMER CONFORMED NAME: BADGER METER MANUFACTURING CO DATE OF NAME CHANGE: 19710729 8-K 1 a5330366.txt BADGER METER, INC. 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) February 6, 2007 Badger Meter, Inc. (Exact name of Registrant as Specified in Charter) Wisconsin 1-6706 39-0143280 (State or Other (Commission File Number) (IRS Employer Jurisdiction Identification No.) of Incorporation) 4545 W. Brown Deer Rd., Milwaukee, Wisconsin 53223 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (414) 355-0400 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 February 6, 2007, the Company issued a press release announcing its quarterly financial results for the fourth quarter and year ended December 31, 2006. A copy of the press release issued by the Company announcing the foregoing is attached hereto as Exhibit 99.1 and is incorporated herein by reference. Item 9.01 Financial Statements and Exhibits. - --------- ---------------------------------- (a) Financial Statements of Business Acquired. ------------------------------------------ Not applicable. (b) Pro Forma Financial Information. -------------------------------- Not applicable. (c) Shell Company Transactions. --------------------------- Not applicable. (d) Exhibits. --------- The exhibit filed herewith is as listed in the accompanying Exhibit Index. 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. BADGER METER, INC. Date: February 6, 2007 By: /s/ Richard E. Johnson --------------------------------------------- Richard E. Johnson Senior Vice President - Finance and Treasurer Chief Financial Officer Exhibit Index to Current Report on Form 8-K Dated February 6, 2007 Exhibit Number - ------ Description ----------- (99.1) Badger Meter, Inc. Press Release, dated February 6, 2007. EX-99.1 2 a5330366ex99-1.txt EXHIBIT 99.1 Exhibit 99.1 Badger Meter Reports Record Sales for 2006 MILWAUKEE--(BUSINESS WIRE)--Feb. 6, 2007--Badger Meter, Inc. (AMEX: BMI) today reported record sales from continuing operations for the fourth quarter and year ended December 31, 2006, and increased earnings from continuing operations for the year ended December 31, 2006. 2006 Highlights -- Net sales from continuing operations were a record $229,754,000, a 12.8% increase from sales of $203,637,000 in 2005. -- Earnings from continuing operations before income taxes were $27,489,000 in 2006, a 7.1% increase from earnings from continuing operations before income taxes of $25,664,000 in 2005. Earnings from continuing operations exclude the results of the company's French subsidiary, which has been classified as a discontinued operation in accordance with current accounting standards. -- Net earnings were $7,548,000 for 2006, a 43.0% decrease from earnings of $13,253,000 in 2005, due to the losses on discontinued operations. -- Diluted earnings per share were $0.52 in 2006, a 45.3% decrease from earnings of $0.95 per diluted share in 2005, due to the losses on discontinued operations. Fourth Quarter 2006 Highlights -- Net sales from continuing operations were $52,705,000 for the fourth quarter of 2006, an 8.4% increase from sales of $48,643,000 for the fourth quarter of 2005. -- Earnings from continuing operations before income taxes were $4,534,000 for the fourth quarter of 2006, a 16.6% decrease from earnings from continuing operations before income taxes of $5,435,000 for the same period in the prior year. -- The company reported a net loss of $213,000 for the fourth quarter of 2006, compared to net earnings of $1,727,000 for the comparable prior period, due to the losses on discontinued operations. -- The net loss per diluted share in the fourth quarter of 2006 was $0.01, compared to earnings of $0.12 per diluted share for the fourth quarter of 2005, due to the losses on discontinued operations. Operations Review "The record 2006 sales were driven by double-digit increases in sales of our Orion(R) proprietary radio frequency automatic meter reading (AMR) system for the utility residential market and sales of commercial products for the utility market. Industrial sales also increased, primarily due to higher sales of our new line of Magnetoflow(R) meters," said Richard A. Meeusen, chairman, president and chief executive officer of Badger Meter. Meeusen said net earnings for the fourth quarter and the year were affected by higher metal costs, particularly copper, and charges related to the shutdown of the company's subsidiary in Nancy, France. "The higher copper costs reduced operating margins in 2006, however we are encouraged by the recent downward trend in material costs. While the cost reductions came too late to help us in the fourth quarter, we expect the lower copper costs combined with our mid-2006 price increases to benefit our margins in 2007," said Meeusen. "The operations of our French subsidiary have been discontinued as of December 31, 2006 and the remaining assets will be liquidated during 2007. Through the end of the year, shutdown charges amounted to $5,409,000 or $0.38 per diluted share and we expect the final total will be within our previously announced range of $6 to $8 million," said Meeusen. These charges were in addition to French operating losses of $3,611,000 or $0.25 per diluted share in 2006. "With the closing of the French operation essentially completed, we can now focus on the areas with the greatest growth and profit potential, such as automatic meter reading. To facilitate the increasing demand for Orion(R) and other metering products, we moved our operations in Rio Rico, Arizona, to a new and larger facility in Nogales, Mexico, and will begin the second phase of this expansion in 2007," said Meeusen. Meeusen said research and development continues to be a focus. "Developing new products and product enhancements is a key growth strategy for Badger Meter, as we work to leverage our technology leadership, especially in AMR, into increased sales and earnings. We plan to introduce several new products in 2007 that will further strengthen our product line," said Meeusen. During 2006, the company increased the quarterly cash dividend for the 14th consecutive year. He also noted that the company's balance sheet remains strong, with a debt-to-capitalization ratio of 27.1% at year-end 2006. "We believe we are well positioned to benefit from the opportunities in the growing AMR market, as well as in the markets for our large commercial meters and industrial products. Overall, we are optimistic about 2007 and our ability to deliver increased value to our shareholders over the long term," added Meeusen. About Badger Meter Badger Meter is a leading marketer and manufacturer of flow measurement and control technology, developed both internally and with other companies, as well as the leader in providing digital connectivity to leading automatic meter reading technologies. Its products are used to measure and control the flow of liquids in a variety of applications. Certain statements contained in this news release, as well as other information provided from time to time by Badger Meter, Inc. (the "Company") or its employees, may contain forward looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward looking statements. The words "anticipate," "believe," "estimate," "expect," "think," "should" and "objective" or similar expressions are intended to identify forward looking statements. All such forward looking statements are based on the Company's then current views and assumptions and involve risks and uncertainties that include, among other things: -- the continued shift in the Company's business from lower cost, local read meters toward more expensive, value-added automatic meter reading (AMR) systems; -- the success or failure of newer Company products, including the Orion(R) radio frequency AMR system, the absolute digital encoder (ADE(TM)) and the Galaxy(R) fixed network AMR system; -- changes in competitive pricing and bids in both the domestic and foreign marketplaces, and particularly in continued intense price competition on government bid contracts for lower cost, local read meters; -- the actions (or lack thereof) of the Company's competitors; -- changes in the Company's relationships with its alliance partners, primarily its alliance partners that provide AMR connectivity solutions, and particularly those that sell products that do or may compete with the Company's products; -- changes in the general health of the United States and foreign economies, including housing starts in the United States and overall industrial activity; -- increases in the cost and/or availability of needed raw materials and parts, including recent increases in the cost of brass housings as a result of increases in the commodity prices for copper and zinc at the supplier level and resin as a result of increases in petroleum and natural gas prices; -- the ability to shut down its French operations in an orderly fashion and to maximize the value of the related assets; -- changes in foreign economic conditions, particularly currency fluctuations between the United States dollar and the euro; -- the loss of certain single-source suppliers; and -- changes in laws and regulations, particularly laws dealing with the use of lead (which can be used in the manufacture of certain meters incorporating brass housings) and Federal Communications Commission rules affecting the use and/or licensing of radio frequencies necessary for AMR products. All of these factors are beyond the Company's control to varying degrees. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward looking statements and are cautioned not to place undue reliance on such forward looking statements. The forward looking statements made in this document are made only as of the date of this document and the Company assumes no obligation, and disclaims any obligation, to update any such forward looking statements to reflect subsequent events or circumstances. Badger Meter company news is available 24 hours a day, on-line at: http://www.badgermeter.com. BADGER METER, INC. CONSOLIDATED STATEMENTS OF OPERATIONS Twelve Months Ended December 31, 2006 2005 ---------------- --------------- (unaudited) Net sales $229,754,000 $203,637,000 Gross margin $76,628,000 $73,419,000 Earnings from continuing operations $27,489,000 $25,664,000 before income taxes Provision for income taxes $10,921,000 $9,500,000 Net earnings on continuing operations $16,568,000 $16,164,000 Loss from discontinued operations, ($9,020,000) ($2,911,000) net of income taxes Net earnings $7,548,000 $13,253,000 Earnings (loss) per share: Basic from continuing operations $1.19 $1.20 Basic from discontinued operations ($0.65) ($0.22) ---------------- --------------- Total basic $0.54 $0.98 Diluted from continuing operations $1.15 $1.15 Diluted from discontinued operations ($0.63) ($0.20) ---------------- --------------- Total diluted $0.52 $0.95 Shares used in computation of: Basic 13,867,949 13,489,196 Diluted 14,388,854 14,022,197 Three Months Ended December 31, 2006 2005 ---------------- --------------- (unaudited) (unaudited) Net sales $52,705,000 $48,643,000 Gross margin $17,123,000 $17,304,000 Earnings from continuing operations $4,534,000 $5,435,000 before income taxes Provision for income taxes $2,201,000 $1,743,000 Net earnings on continuing operations $2,333,000 $3,692,000 Loss from discontinued operations, ($2,546,000) ($1,965,000) net of income taxes Net earnings (loss) ($213,000) $1,727,000 Earnings (loss) per share: Basic from continuing operations $0.17 $0.27 Basic from discontinued operations ($0.19) ($0.14) ---------------- --------------- Total basic ($0.02) $0.13 Diluted from continuing operations $0.16 $0.26 Diluted from discontinued operations ($0.17) ($0.14) ---------------- --------------- Total diluted ($0.01) $0.12 Shares used in computation of: Basic 13,975,602 13,579,362 Diluted 14,460,672 14,155,544 BADGER METER, INC. CONSOLIDATED CONDENSED BALANCE SHEETS Assets - ------------------------------------- December 31, December 31, 2006 2005 --------------- --------------- (unaudited) Cash $3,002,000 $3,215,000 Receivables 29,124,000 27,060,000 Inventories 33,290,000 27,349,000 Other current assets 7,068,000 5,614,000 Assets of discontinued operations 6,875,000 9,326,000 --------------- --------------- Total current assets 79,359,000 72,564,000 Net property, plant and equipment 44,709,000 40,337,000 Prepaid pension 0 17,726,000 Other long-term assets 8,357,000 4,657,000 Assets of discontinued operations 0 4,003,000 Goodwill 6,958,000 6,580,000 --------------- --------------- Total assets $139,383,000 $145,867,000 =============== =============== Liabilities and Shareholders' Equity - ------------------------------------- Short-term debt and current portion long-term debt $17,037,000 $13,328,000 Payables 10,597,000 10,292,000 Accrued compensation and employee benefits 6,181,000 5,962,000 Other liabilities 3,575,000 4,698,000 Liabilities of discontinued operations 8,321,000 5,361,000 --------------- --------------- Total current liabilities 45,711,000 39,641,000 Deferred income taxes 199,000 6,584,000 Long-term employee benefits and other 15,726,000 10,866,000 Long-term debt 5,928,000 15,360,000 Shareholders' equity 71,819,000 73,416,000 --------------- --------------- Total liabilities and shareholders' equity $139,383,000 $145,867,000 =============== =============== CONTACT: Badger Meter, Inc. Joan C. Zimmer, 414-371-5702 -----END PRIVACY-ENHANCED MESSAGE-----