0001157523-21-000106.txt : 20210129 0001157523-21-000106.hdr.sgml : 20210129 20210129083543 ACCESSION NUMBER: 0001157523-21-000106 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 13 CONFORMED PERIOD OF REPORT: 20210129 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20210129 DATE AS OF CHANGE: 20210129 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: 21568295 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 a52369707.htm 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)
January 29, 2021
 
 
 
 
 
 
BADGER METER INC
(Exact name of registrant as specified in its charter)
 
Wisconsin 
 
001-06706
 
39-0143280 
(State or other
jurisdiction of
incorporation)
 
(Commission File
Number)
 
(IRS Employer
Identification No.)
 
4545 W. Brown Deer Rd., Milwaukee, Wisconsin 53223
(Address of principal executive offices, including zip code)
 
(414) 355-0400
(Registrant's telephone number, including area code)
 
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))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
  Trading Symbol(s)
  Name of each exchange on which registered
Common Stock
  BMI
  New York Stock Exchange LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 2.02
Results of Operations and Financial Condition .

On January 29, 2021, Badger Meter, Inc. (the “Company”) issued a press release announcing its quarterly financial results for the 2020 fourth quarter ended December 31, 2020.
 
A copy of the press release issued by the Company announcing the foregoing is furnished herewith as Exhibit 99.1.
 
Item 9.01
Financial Statements and Exhibits .
   
           (a) Not applicable.
   
           (b) Not applicable.
   
           (c) Not applicable.
   
           (d) Exhibits .  The exhibit furnished herewith is as listed in the accompanying Exhibit Index.
             
 
EXHIBIT INDEX
 
Exhibit No.
 
Description
                (99.1)
 
 
 
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: January 29, 2021
By:
/s/ Robert A. Wrocklage
 
 
 
Robert A. Wrocklage
 
 
 
Senior Vice President – Chief Financial Officer
 

EX-99.1 2 a52369707ex99_1.htm EXHIBIT 99.1
Exhibit 99.1

Badger Meter Reports Fourth Quarter and Full Year 2020 Results

MILWAUKEE--(BUSINESS WIRE)--January 29, 2021--Badger Meter, Inc. (NYSE: BMI) today reported results for the fourth quarter and full year ended December 31, 2020.

Fourth Quarter 2020 Highlights

  • Total sales of $112.3 million, an increase of 4% compared to $107.6 million in the comparable prior year quarter.
  • Net earnings and diluted earnings per share (EPS) were $13.1 million and $0.45, respectively, compared to $12.3 million and $0.42 in the comparable prior year period.
  • Deployed $29.1 million, net of cash acquired, for s::can GmbH (“s::can”) effective November 1, 2020, adding online water quality monitoring to existing trusted Badger Meter solutions.

Full Year 2020 Highlights

  • Full year 2020 sales of $425.5 million, a slight increase compared to $424.6 million in 2019 reflecting the resiliency of the utility water industry.
  • Strong incremental profitability with a 70 basis point increase in operating profit margins.
  • Net earnings and diluted earnings per share (EPS) were $49.3 million and $1.69, respectively, compared to $47.2 million and $1.61 in the comparable prior year period.
  • Generated $89.6 million of cash provided by operations, an 11% increase year-over-year.

“Badger Meter delivered another quarter of strong performance and an outstanding year in light of the many and varied challenges associated with managing through the pandemic,” said Kenneth C. Bockhorst, Chairman, President and Chief Executive Officer. “Our performance is the direct result of the durability of our business model and the efforts of our employees across the globe who have helped us safely maintain our operations and serve customers.”

Fourth Quarter Operating Results
Utility water sales increased 8% from the strong comparable prior year quarter, with the acquisition of s::can contributing approximately 3% of the sales increase. Existing AMI (advanced metering infrastructure) project installation schedules progressed and we experienced growth in sales of ultrasonic meters and ORION® Cellular radios with related BEACON® Software as a Service (SaaS). Sales of flow instrumentation products were 10% lower year-over-year, sequentially improved from the third quarter, yet continuing to reflect the sluggish activity across most of the varied industrial end markets served.


Operating margins of 15.1% were 10 basis points lower than the prior year’s 15.2%. Gross margin increased $2.9 million year-over-year, and gross margin percent increased 100 basis points to 39.2% from the prior year’s 38.2%. The quarter benefitted from favorable sales mix with higher SaaS, cellular radio and ultrasonic meter sales and favorable facility utilization. Margins were also supported by positive price/cost dynamics, the result of strategic pricing initiatives in advance of rising brass input costs. These benefits were partially offset by a discrete network sunset provision associated with future equipment upgrades for early-stage Code Division Multiple Access (“CDMA”) radio endpoints for a limited number of North American customers, along with the acquisition-related fair value step-up of acquired s::can inventory.

Selling, engineering and administration (“SEA”) expenses in the fourth quarter of 2020 of $27.1 million increased $2.3 million from the prior year’s $24.8 million with the inclusion of s::can and resulting acquisition-related intangible amortization along with higher personnel costs, partially offset by lower travel and other pandemic-impacted expenses. SEA leverage was 24.1% up from 23.0% in the comparable prior year quarter. The tax rate of 22.6% was modestly lower than the prior year’s 24.3%.

Full Year Recap and Outlook
Bockhorst continued, “Recapping 2020, our team successfully supported customers while managing through the unprecedented health and economic crisis. With the backdrop of countless changes to how we all do business, Badger Meter delivered utility water revenue growth, EBITDA margin and EPS expansion, robust working capital management and free cash flow, and strategic execution of our capital allocation priorities with accretive acquisitions and dividend growth. We are excited about the acquisition of s::can completed in the quarter and the recently announced acquisition of Analytical Technology, Inc. (“ATi) effective January 1, 2021. These accomplishments are a testament to the criticality of the water industry and the exceptional Badger Meter team.”

“While we anticipate the overall economic environment will remain uncertain, we are confident in our strategic growth plans and the fundamental long-term drivers of our offerings. Leveraging our industry-leading ORION® Cellular endpoints, along with current and future communication and software technologies, we are creating robust digital solutions to operationalize real-time data into actionable insights that drive better results and optimize operations. The inclusion of the recently acquired s::can and ATi portfolio of comprehensive and scalable water quality monitoring solutions will now allow us to deliver real-time water quality data to our customers. Access to real-time, on demand water quality parameters will enable water utilities to improve operational security, awareness and efficiency, while our industrial customers will benefit from process and discharge water quality monitoring.”

“Our order backlog, sales momentum, and encouraging pipeline of potential business gives us confidence as we start the new year. Our teams continue to focus on what we can control as we serve our customers and maintain safe operating environments. While strategic pricing initiatives have and continue to be implemented, the recent rapid and significant escalation in brass costs may be an impediment to near-term margin expansion opportunities.”


Bockhorst concluded, "Badger Meter is a company that has successfully managed through challenges over its 115-year history, and this pandemic is no exception. We are fortunate to navigate through this environment from a position of strength. We believe that the combination of our talented team, resilient portfolio of solutions and strong balance sheet uniquely position Badger Meter for success in 2021 and beyond as we work to protect the world’s most precious resource.”

Conference Call and Webcast Information
Badger Meter management will hold a conference call to discuss 2020 results today, January 29, 2021 at 10:00 AM CT/11:00 AM ET. The call and related presentation can be accessed via webcast through the Investor section of our website. Participants can register to take part in the call using this online registration link: http://www.directeventreg.com/registration/event/6277158. After registering, instructions will be shared on how to join the call. If online registration is unavailable, registration can also be accomplished by calling 888-869-1189 or 706-643-5902 and providing the conference ID number: 6277158. The webcast will be archived on the company’s website until its next earnings release.

Safe Harbor Statement
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 statements. Potential factors that could affect such forward-looking statements include the duration, severity and geographic spread of the COVID-19 pandemic, government actions to address or mitigate the impact of the COVID-19 pandemic, and the potential negative impacts of COVID-19 on the global economy, the company’s operations and those of our customers and suppliers. In addition, the company’s results are subject to general economic conditions, variation in demand from customers, continued market acceptance of new products, the successful integration of acquisitions, competitive pricing and operating efficiencies, supply chain risk, material and labor cost increases, tax reform and foreign currency risk. See the company’s Form 10-K filed with the Securities and Exchange Commission for further information regarding risk factors, which are incorporated herein by reference. Badger Meter disclaims any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason.

About Badger Meter
With more than a century of water technology innovation, Badger Meter is a global provider of industry leading water solutions encompassing flow measurement, quality and other system parameters. These offerings provide our customers with the data and analytics essential to optimize their operations and contribute to the sustainable use and protection of the world’s most precious resource. For more information, visit www.badgermeter.com.


BADGER METER, INC.








 
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(in thousands, except share and earnings per share data)








 








 


Three Months Ended

 

Twelve Months Ended



December 31,

 

December 31,

 

December 31,

 

December 31,



2020

 

2019

 

2020

 

2019



(Unaudited)


(Unaudited)









 
Net sales

$

112,329


$

107,556

 


$

425,544


$

424,625









 
Cost of sales

 

68,274


 

66,431

 


 

257,295


 

261,097









 
Gross margin

 

44,055


 

41,125

 


 

168,249


 

163,528









 
Selling, engineering and administration

 

27,093


 

24,782

 


 

103,093


 

101,380









 
Operating earnings

 

16,962


 

16,343

 


 

65,156


 

62,148









 
Interest expense (income), net

 

12


 

(27

)


 

30


 

253

Other pension and postretirement costs

 

36


 

165

 


 

145


 

288









 
Earnings before income taxes

 

16,914


 

16,205

 


 

64,981


 

61,607









 
Provision for income taxes

 

3,820


 

3,931

 


 

15,638


 

14,430









 
Net earnings

$

13,094


$

12,274

 


$

49,343


$

47,177









 
Earnings per share:















 
Basic

$

0.45


$

0.42

 


$

1.70


$

1.63









 
Diluted

$

0.45


$

0.42

 


$

1.69


$

1.61









 
Shares used in computation of earnings per share:















 
Basic

 

29,057,249


 

29,039,296

 


 

29,052,301


 

29,028,204









 
Diluted

 

29,257,929


 

29,227,804

 


 

29,229,868


 

29,220,165


BADGER METER, INC.




 
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands)




 




 

Assets


December 31,


December 31,



2020


2019



(Unaudited)





 
Cash and cash equivalents

$

72,273


$

48,871

Receivables

 

61,689


 

61,365

Inventories

 

81,586


 

81,948

Other current assets

 

5,303


 

7,910

Total current assets

 

220,851


 

200,094





 
Net property, plant and equipment

 

82,705


 

85,761

Intangible assets, at cost less accumulated amortization

 

53,598


 

48,163

Other long-term assets

 

22,518


 

16,617

Goodwill

 

88,708


 

71,258

Total assets

$

468,380


$

421,893





 




 

Liabilities and Shareholders' Equity









 
Short-term debt

$

-


$

4,480

Payables

 

34,923


 

31,523

Accrued compensation and employee benefits

 

14,617


 

12,754

Other current liabilities

 

15,659


 

8,490

Total current liabilities

 

65,199


 

57,247





 
Deferred income taxes

 

5,696


 

876

Long-term employee benefits and other

 

36,226


 

32,702

Shareholders' equity

 

361,259


 

331,068

Total liabilities and shareholders' equity

$

468,380


$

421,893


BADGER METER, INC.









 
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(in thousands)









 









 


Three Months Ended
Twelve Months Ended


December 31,
December 31,
December 31,
December 31,


2020


2019


2020


2019




(Unaudited)


(Unaudited)


Operating activities:








Net earnings

$

13,094

 


$

12,274

 


$

49,343

 


$

47,177

 











 
Adjustments to reconcile net earnings to net cash provided by operations:








Depreciation

 

3,121

 


 

2,881

 


 

12,253

 


 

11,569

 


Amortization

 

3,160

 


 

3,254

 


 

12,963

 


 

12,577

 


Deferred income taxes

 

(3,483

)


 

(1,542

)


 

(3,082

)


 

(1,524

)


Noncurrent employee benefits

 

(365

)


 

110

 


 

206

 


 

(40

)


Stock-based compensation expense

 

374

 


 

332

 


 

1,415

 


 

1,214

 


Changes in:








Receivables

 

(148

)


 

896

 


 

3,036

 


 

5,451

 


Inventories

 

(59

)


 

3,039

 


 

5,129

 


 

(1,220

)


Payables

 

(6,876

)


 

757

 


 

(391

)


 

11,642

 


Prepaid expenses and other current assets

 

(1,347

)


 

(1,926

)


 

(3,522

)


 

(7,732

)


Other current liabilities

 

8,429

 


 

(500

)


 

12,228

 


 

1,600

 


Total adjustments

 

2,806

 


 

7,301

 


 

40,235

 


 

33,537

 


Net cash provided by operations

 

15,900

 


 

19,575

 


 

89,578

 


 

80,714

 











 
Investing activities:








Property, plant and equipment expenditures

 

(3,204

)


 

(1,907

)


 

(9,059

)


 

(7,496

)


Acquisitions, net of cash acquired

 

(29,134

)


 

-

 


 

(29,134

)


 

-

 


Net cash used for investing activities

 

(32,338

)


 

(1,907

)


 

(38,193

)


 

(7,496

)











 
Financing activities:








Net decrease short-term debt

 

-

 


 

-

 


 

(4,600

)


 

(13,500

)


Payment of contingent acquisition consideration

 

(1,001

)


 

(905

)


 

(1,001

)


 

(2,555

)


Dividends paid

 

(5,232

)


 

(4,943

)


 

(20,340

)


 

(18,595

)


Proceeds from exercise of stock options

 

553

 


 

998

 


 

1,058

 


 

1,961

 


Repurchase of treasury stock

 

(182

)


 

(1,848

)


 

(3,116

)


 

(5,207

)


Issuance of treasury stock

 

54

 


 

44

 


 

180

 


 

187

 


Net cash used for financing activities

 

(5,808

)


 

(6,654

)


 

(27,819

)


 

(37,709

)


Effect of foreign exchange rates on cash

 

618

 


 

129

 


 

(164

)


 

276

 











 
(Decrease) Increase in cash and cash equivalents

 

(21,628

)


 

11,143

 


 

23,402

 


 

35,785

 


Cash and cash equivalents - beginning of period

 

93,901

 


 

37,728

 


 

48,871

 


 

13,086

 











 
Cash and cash equivalents - end of period

$

72,273

 


$

48,871

 


$

72,273

 


$

48,871

 


 

Contacts

Karen Bauer at (414) 371-7276 kbauer@badgermeter.com


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