|
Delaware
|
001-34045
|
54-1887631
|
|
(State
or other jurisdiction
|
(Commission
|
(I.R.S.
Employer
|
|
of
incorporation)
|
File
Number)
|
Identification
No.)
|
|
Item
7.01
|
Regulation
FD Disclosure.
|
|
Item
9.01
|
Financial
Statements and Exhibits.
|
|
|
99.1
|
Colfax
Corporation investor presentation
slides
|
|
Colfax
Corporation
|
||||
|
Date: August
13, 2009
|
By:
|
/s/ THOMAS
M. O’BRIEN
|
||
|
Name:
|
Thomas
M. O’Brien
|
|||
|
Title:
|
Senior
Vice President, General Counsel
|
|||
|
and
Secretary
|
||||
|
|
99.1
|
Colfax
Corporation investor presentation
slides.
|
Investor Presentation
August 2009
Exhibit 99.1
The following information contains forward-looking statements, including forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements include, but are not limited to, statements concerning Colfax's plans, objectives,
expectations and intentions and other statements that are not historical or current facts. Forward-
looking statements are based on Colfax's
current expectations and involve risks and uncertainties that
could cause actual results to differ materially from those expressed or implied in such forward-looking
statements. Factors that could cause Colfax's results to differ materially
from current expectations
include, but are not limited to factors detailed in Colfax's reports filed with the U.S. Securities and
Exchange Commission as well as its Annual Report on Form 10-K under the caption “Risk Factors”. In
addition, these statements are based on a number of assumptions that are subject to change. This
presentation speaks only as of this date. Colfax disclaims any duty to update the information herein.
Forward-Looking Statements
1
2008 revenue of
$605 million
~2,100 associates
worldwide
15 principal
production facilities in
7 countries
Over 300 direct
sales and marketing
associates
More than 450
authorized distributors
in approximately 80
countries
Headquartered in
Richmond, VA
Colfax is strategically focused on serving key infrastructure end markets in the fluid handling industry
2 & 3 Screw
Pumps
Centrifugal
Pumps
Progressive
Cavity Pumps
Precision Gear
Pumps
Specialty
Valves
Fluid Handling
Systems
End Markets
Products
Global Navy
General
Industrial
Commercial
Marine
Oil & Gas
Power
Generation
Company Overview
2
Founded in 1995
John Young, President & CEO, was an original founder
Equity capital provided by Mitch and Steve Rales, founders of Danaher (NYSE: DHR)
Targeted global industrial companies with strong brands
12 acquisitions, 5 divestitures
Exclusively focused on fluid handling industry
Proven, experienced management team
Began trading on the NYSE in May 2008
There are approximately 5,000 pump companies globally and Colfax is in the top 15
Background
3
POLICY DEPLOYMENT
On Time Delivery - Products and Services
Customer
Satisfaction
Voice
of the
Customer
Production Poka-Yoke Jidoka Strategic Supplier Design for
Preparation Development Six Sigma
Product Development QFD Six Sigma DOE Multi-skilled JIT
System Process Workforce Accounting
DMP SMED Visual TPM One-piece Problem
Management Flow Solving
Benchmark 5S Metrics Standard Measurement Cellularization
WorkSystem Analysis
Profitable
Sales
Growth
Six Sigma Quality
Cost Control and Improvement
Derived from the proven
Danaher Business System
Utilize Voice of the
Customer (“VOC”) to target
breakthrough growth
initiatives, new products and
applications
Conduct root-cause
analysis, develop process
improvements and
implement sustainable
systems
Culture of continuous
improvement
Integrated in all aspects
of operations and strategic
planning
CBS is how we manage our business and has been a key driver of our success
Colfax Business System Drives Business Improvement
4
Global leader in specialty fluid handling products
Proven application expertise in solving critical customer needs
Serving growing global infrastructure driven end markets
Leading brand names generating aftermarket sales and services
Experienced management team in place to grow organically and through strategic
acquisition
Strong financial position
Significant insider ownership
Consistent track record of driving profitable organic sales growth
Investment Highlights
5
6
Broad Product Portfolio Focused on Customer Applications
Centrifugal Pumps
Specialty Valves
Progressive Cavity Pumps
Precision Gear Pumps
Fluid Handling Systems
Well recognized brands across served markets
2 and 3 Screw Pumps
7
Commercial
Marine
Serving Critical Applications in Our Key End Markets
General
Industrial
Power
Generation
Oil & Gas
Global Navy
Key Markets
Applications
Brands
Commercial
Marine
Fuel oil transfer; oil transport; water and wastewater handling
Allweiler,
Houttuin
,
I
mo
AB
Oil & Gas
Crude oil gathering; pipeline services; unloading and loading; rotating
equipment lubrication; lube oi
l purification
Allweiler, Houttuin,
Imo,
LSC,
Tushaco
,
Warren
Power Generation
Fuel unloading, transfer, burner and injection; rotating equipment
lubrication
Allweiler, Imo,
Tushaco
, Warren
Global
Navy
Fuel oil transfer; oil transport; water and wastewate
r handling; firefighting;
fluid control
Allweiler,
Fairmount,
I
mo
,
I
m
o
AB,
Portland
Valve,
Warren
General Industrial
Machinery lubrication; hydraulic elevators; chemical processing; pulp and
paper processing; food and beverage processing
Allweiler,
Fairm
ount,
Houttuin,
I
mo
,
Tushaco
, Warren,
Zenith
Key Markets
Applications
Brands
Commercial
Marine
Fuel oil transfer; oil transport; water and wastewater handling
Allweiler,
Houttuin
,
I
mo
AB
Oil & Gas
Crude oil gathering; pipeline services; unloading and loading; rotating
equipment lubrication; lube oi
l purification
Allweiler, Houttuin,
Imo,
LSC,
Tushaco
,
Warren
Power Generation
Fuel unloading, transfer, burner and injection; rotating equipment
lubrication
Allweiler, Imo,
Tushaco
, Warren
Global
Navy
Fuel oil transfer; oil transport; water and wastewate
r handling; firefighting;
fluid control
Allweiler,
Fairmount,
I
mo
,
I
m
o
AB,
Portland
Valve,
Warren
General Industrial
Machinery lubrication; hydraulic elevators; chemical processing; pulp and
paper processing; food and beverage processing
Allweiler,
Fairm
ount,
Houttuin,
I
mo
,
Tushaco
, Warren,
Zenith
Asia &
Australia
Europe
United
States
Canada
Central &
South
America
Middle East
& Africa
Power
Generation
General
Industrial
Oil & Gas
Commercial
Marine
Global Navy
Blue chip customer base with no single customer representing more than 3% of sales in 2008
____________________
(1)
Includes Distribution (11%), Chemical Processing (7%), Machinery Support (5%), Building Products (4%), Wastewater (2%), Heat Transfer (2%), Pulp and Paper (1%), Diesel Engines (1%), Food & Beverage (1%) and Other (7%).
(2)
Revenues based on our shipping destination.
41%
25%
14%
14%
6%
(1)
22%
51%
5%
15%
4%
3%
2008 Revenues By End Markets
2008 Revenues By Geography (2)
Blue Chip Customers
Large and Diverse Customer Base and End Markets
8
EMEA
2008 Sales (1) = $338mm
____________________
(1)
Sales figures reflect sales destination.
(2)
Closing in 2009.
Americas
2008 Sales (1) = $174mm
% of Revenue: 29%
% of Revenue: 56%
% of Revenue: 15%
LSC
Houston
Warren
Corporate HQ Richmond
Imo Kentucky
Imo Monroe
Sanford (2)
Houttuin
Tushaco
Vapi
Tushaco
Daman
Colfax Wuxi
Imo AB Stockholm
Allweiler
Gottmandingen
Portland Valve
Allweiler
Tours
Allweiler Radolfzell
Allweiler Bottrop
Fairmount Automation
Expanding global footprint allows us to serve fast growing, developing markets
Extensive Global Sales, Distribution and Manufacturing
Footprint
Asia Pacific
2008 Sales (1) = $93mm
9
Situation Analysis
A Canadian energy company moves heavy crude oil along
pipelines from the oil fields in Northern Canada through
extremely harsh environment to a central blending facility
Colfax engineers and the customer's project engineer jointly
developed the design, quality, and testing spec
Warren GTS-H268 2 screw pumps with specially designed
internal wear resistant components were chosen to meet
the rigorous application
Colfax pumps installed – 6X increase in service life
Customer realizes $2M annual savings - spare parts alone
Colfax Solution
Situation Analysis
Major Venezuelan oil company moves 180,000 BPD of sand
laden crude oil through pipelines using a competitor’s
pumps. Pumps are failing after only 3 - 4 months due to
excessive
wear
Colfax Solution
For the past 40 years this customer has turned to Colfax
and the Imo 8L 3 screw pump – more than 80 installations
Reliable in the toughest environment
Superior energy efficiency – reduces operating costs
Imo 8L is the industry standard for Canadian pipeline
applications from 400 to 2500 gallons per minute
Oil & Gas Markets – Strong Application Expertise
New Imo 8L-912Y
10
Expansion of Systems Business
Situation Analysis
A major Japanese OEM turbine manufacturer wanted
to reduce installation time required at power plant
construction sites. Initial focus - integrate components
associated with the fuel filter,
pump and motor system.
Colfax Solution
Colfax Americas Engineered Systems and OEM jointly
developed integrated package
Enhanced design, reduced costs
Initial system delivered in 2009, others on order
Global installations
Integrated system is now the standard fuel injection
system design for this major turbine OEM customer
Situation Analysis
Colfax Solution
Americas region OEM and end-user customers need
turn-key solutions – not just pumps.
Colfax Americas Engineered Systems business
started in 2007 to address need for highly engineered
systems
Services offered include: custom engineered skid
packages or module subassemblies, fabrication,
testing, and start up/commissioning
2009 forecast - $10M incremental sales
Environmentally-friendly
module with internal,
submersible lubricant
pump and motor
11
Targeting Aftermarket Opportunities
Situation Analysis
Twin cities Gubin (Poland) and Guben (Germany) on
opposite sides of Neisse River each need to update sewage
treatment facility & decide to partner and build one plant in
the mid-1990s. Key
requirements: reliable movement of
wastewater, fast on-site service, rapid delivery of original
spare parts, one plant employee to maintain all pumps, Low
Total Cost of Ownership (TCO), and high energy efficiency.
Colfax Solution
17 Allweiler Progressing cavity pumps and 2 macerator
pumps with variable frequency drives (VFDs) replace
existing centrifugal pumps & progressing cavity pumps – one
source
More than a decade later– uninterrupted operation
Low maintenance cost using original Allweiler parts
Local distributor provides excellent service/support
Higher first cost, lowest TCO
Guben-Gubin sewage plant
Allweiler sludge pump
Colfax’s Allweiler business unit established a consulting
services business targeting sewage treatment customers in
Germany
Service includes – Analysis of entire operation, review
pump/motor assemblies, and recommendation on how to lower
energy costs and reduce maintenance cost
An example – Flerzheim cooperative sewage plant in
Germany’s Rhine Ruhr region
Upgrade 2 PC pumps, eliminate 2 centrifugal pumps
Added VFDs reduce energy usage by 10 – 15 %
Replaced pirated spares with genuine Allweiler parts
2008 results - €1.2M sales incremental
Situation Analysis
Many wastewater treatment facilities purchase non-OEM
(pirated) aftermarket spare parts for progressing cavity
pumps. These lower priced parts have a shorter service life
than genuine Allweiler
OEM parts.
Colfax Solution
Updating sludge pumps
at Flerzheim facility
12
Driven by VOC, examples of new products introduced in 2008
Develop New Products, Applications and
Technologies Driven by Voice of the Customer
Step 1 - VOC
Step 1a – VOC Summary
Step 2 – Prioritization
Step 3 – Specification
All-Heat SMART
EMTEC SMART
Benefits
1.
Senses wear & alerts
end-user
2.
Easy to upgrade
Benefits
1.
50% energy usage
reduction
2.
Eliminates system
components (cooler &
valve)
Simplifies OEM design
Easier installation
All-Fuel SMART
Benefits
1.
Efficient seal
leakage monitoring
system - best value
2.
Easy to upgrade
13
~$24.8bn
~$0.3bn
~$2.3bn
~$4.0bn
~$2.0bn
Global infrastructure development will drive capital investment long term and will benefit local suppliers as well
as international exporters of fluid handling equipment. Demand has softened in several
portions of the
general industrial market including chemical, building products, diesel engine, waste water, machinery support
and distribution, primarily in Europe and North America.
In the U.S., expect Congress to continue to appropriate funds for new ship construction as older naval vessels
are decommissioned. Increased demand for integrated fluid handling systems for both
new ship platforms
and existing ship classes that reduce operating costs and improve efficiency as the U.S. Navy seeks to man
vessels with fewer personnel also anticipated. Sovereign
nations outside of the U.S. continue to expand their
fleets as they address national security concerns.
Expect activity in Asia and the Middle East to remain strong as economic growth and fundamental
undersupply of power generation capacity continues to drive investment in energy infrastructure projects.
Efficiency
improvements will continue to drive demand in the world’s developed economies.
Expect activity within the crude oil market to remain favorable as long term capacity constraints and global
demand drive further development of heavy oil fields, but are experiencing project delays. In
pipeline
applications, demand for highly efficient products expected to remain strong as customers continue to focus
on total cost of ownership. In refinery applications, a reduction in capital investment by customers is believed
will
reduce the demand for our products.
Expect international trade and demand for crude oil and other commodities as well as the age of the global
merchant fleet to continue to create demand for new ship construction; however, expect new orders to
be
significantly lower than in the past two years. Expect sales to grow primarily from existing orders; likely to
have additional order cancellations. Believe the increase in the size of the global fleet will create an
opportunity
to supply aftermarket parts and service.
Estimated
Market Size
Favorable long term demand driven by global infrastructure build
Market Expectations
Serving Infrastructure Driven End Markets
14
Capitalize on growth opportunities by offering regionally developed products and solutions
Standard packages of Imo and Allweiler products produced at our Greenfield, Wuxi China
facility for Commercial Marine
Continue to invest in sales and marketing capabilities to more effectively serve local Asia Pacific
markets
Leverage application expertise to design fluid handling solutions that cater to heavy crude oil
exploration in Latin America, Middle East and Russia
Opened sales and engineering office in Bahrain in March
Utilize Indian / Chinese low cost manufacturing to supply components to other Colfax business
units
Execute acquisitions
Assam, India
Shanghai, China
Target Fast Growing Regions
15
Est. 1860
Acq. 1998
Est. 1897
Acq. 1997
Est. 1929
Acq. 1998
Est. 1931
Acq. 1997
Est. 1973
Acq. 2004
Est. 1920
Acq. 2004
Est. 1967
Acq. 2005
Est. 1968
Acq. 2007
Est. 1996
Acq. 2007
Product history dating back
to 1860 provides large
installed base
High quality, reliable
products used in critical
applications
Tendency for customers to
replace “like for like” products
Significant aftermarket
demand for replacement
products, spare parts and
repair and maintenance
services
Approximately 24% of revenues were derived from aftermarket sales and services in 2008
Leading Brands Generating Aftermarket Sales and Services
16
Continue to proactively engage with
highly strategic targets
Product, market and geographically
focused searches
Evaluate opportunistic bolt-on
companies
Pursue adjacent fluid handling
acquisitions
Effective selection and integration of 12 acquisitions since 1995
Acquisition Criteria
Acquisition Initiatives
Acquire companies in the fluid handling
industry
Strong brand name recognition
Leading market position
Differentiated product technology / highly
engineered product
Complementary end market / geographic
focus
Attain double digit return on investment in
the 3rd year
Continue to Pursue Strategic Acquisitions that
Complement Our Platform
17
Claims arise from purchased components previously included in our products
Significant solvent insurance coverage
Bad faith lawsuit against insurance carriers increases costs in near term
Estimated annual liability and related defense costs of $5 - $7 million before potential
insurance asset or liability adjustments
2008
2007
2006
2005
$9,000
$8,000
$7,000
$6,000
$5,000
$4,000
$3,000
$8,896
$5,232
$5,378
$6,194
Asbestos Update
Unresolved Claims
Average Cost of Resolved Claims
59,217
50,020
37,554
35,357
30,000
36,000
42,000
48,000
54,000
60,000
2005
2006
2007
2008
18
Financial Overview
19
Financial Performance Overview – 2005-2008
2008
2007
2006
2005
$120.0
$100.0
$80.0
$60.0
$40.0
$20.0
$0.0
$105.6
$88.2
$64.1
$54.8
2008
2007
2006
2005
$700.0
$600.0
$500.0
$400.0
$300.0
$200.0
$100.0
$0.0
$370.4
$669.2
$581.5
$442.3
Revenue
(1) Refer to Appendix for Non-GAAP reconciliation. Note: Dollars in millions.
Orders
Total Growth
28.6%
19.5%
Existing Businesses
13.9%
13.5%
13.9%
Acquisitions
8.0%
1.1%
FX Translation
7.1%
4.5%
--
--
--
11.8%
1.4%
0.8%
Total Growth
63.3%
15.2%
Existing Businesses
51.6%
47.2%
15.0%
Acquisitions
3.0%
5.2%
FX Translation
13.1%
(5.0)%
--
--
--
39.5%
--
12.1%
Total Growth
31.5%
15.1%
Existing Businesses
19.4%
17.6%
7.0%
Acquisitions
6.1%
2.0%
FX Translation
7.8%
6.1%
--
--
--
17.7%
1.2%
0.5%
Adjusted EBITDA (1)
% Margin
15.9%
16.3%
17.4%
17.5%
2008
2007
2006
2005
$640.0
$560.0
$480.0
$400.0
$320.0
$240.0
$160.0
$80.0
$0.0
$604.9
$506.3
$393.6
$345.5
Backlog
$118.3
$179.3
$292.8
$337.3
$0.0
$50.0
$100.0
$150.0
$200.0
$250.0
$300.0
$350.0
$400.0
2005
2006
2007
2008
20
Financial Performance Overview – Current Quarter
2009
YTD
2008
YTD
-
Q2 2009
Q2 2008
$400.0
$300.0
$200.0
$100.0
$0.0
$224.9
$369.1
$104.1
$188.8
(39.1)%
--
(44.9)%
--
Total Growth
(7.0)%
--
(6.6)%
--
FX Translation
(32.0)%
--
(38.3)%
--
Existing Businesses
14.4%
16.9%
13.8%
17.0%
% Margin
Adjusted EBITDA (1)
Backlog
Orders
(1) Refer to Appendix for Non-GAAP reconciliation. Note: Dollars in millions.
Revenue
(20.0)%
(9.8)%
(10.2)%
(9.1)%
--
--
Total Growth (Decline)
(11.5)%
--
--
FX Translation
2.4%
--
--
Existing Businesses
2009
YTD
2008
YTD
-
Q2 2009
Q2 2008
$300.0
$200.0
$100.0
$0.0
$265.5
$292.1
$129.2
$161.4
$27.5
$17.8
$49.5
$38.3
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
Q2 2008
Q2 2009
-
YTD
2008
YTD
2009
$292.8
$353.6
$384.0
$383.1
$337.3
$305.6
$292.3
$0.0
$100.0
$200.0
$300.0
$400.0
Q4
2007
Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
21
Income Statement Summary
Refer to Appendix for Non-GAAP reconciliation.
__________________
Note: Dollars in millions.
Long Term Goals: Annual sales of $1 billion, gross profit margin of 40% & EBITDA margin of 20%
Delta
7/3/2009
6/27/2008
$
%
Orders
$ 224.9
$ 369.1
$ (144.2)
(39.1)%
Sales
$ 265.5
$ 292.1
$ (26.6)
(9.1)%
Gross Profit
$ 92.6
$ 105.0
$ (12.4)
(11.8)%
% of Sales
34.9%
35.9%
Adjusted SG&A Expense
$ 58.1
$ 60.2
$ (2.0)
(3.4)%
R&D Expense
3.1
3.0
0.1
4.6%
Operating Expenses
$ 61.2
$ 63.1
$ (1.9)
(3.0)%
% of Sales
23.1%
21.6%
Adjusted Operating Income
$ 31.4
$ 41.9
$ (10.5)
(25.0)%
% of Sales
11.8%
14.3%
Adusted EBITDA
$ 38.3
$ 49.5
$ (11.2)
(22.7)%
% of Sales
14.4%
16.9%
Adjusted Net Income
$ 18.9
$ 24.0
$ (5.2)
(21.5)%
% of Sales
7.1%
8.2%
Six Months Ended
22
____________________
Note: Dollars in millions.
Statement of Cash Flows Summary
7/3/2009
6/27/2008
Net income (loss)
11.2
$
(24.6)
$
Non-cash expenses
7.7
4.3
Change in working capital and accrued liabilities
(5.9)
(32.8)
Other
4.9
(3.9)
Total Operating Activities
17.9
$
(57.0)
$
Capital expenditures
(5.9)
$
(9.1)
$
Other
0.1
0.1
Total Investing Activities
(5.8)
$
(9.0)
$
Repayments of borrowings
(2.5)
$
(106.5)
$
Proceeds from IPO, net of offering costs
-
193.0
Dividends paid to preferred shareholders
-
(38.5)
Other
(0.4)
(3.1)
Total Financing Activities
(2.9)
$
44.9
$
Effect of exchange rates on cash
-
0.1
Increase (decrease) in cash
9.2
(21.0)
Cash, beginning of period
28.8
48.1
Cash, end of period
38.0
$
27.1
$
Six Months Ended
23
Strong balance sheet
Debt to adjusted EBITDA = 1
Debt of $94 million, principal payments of $5 million in 2009, matures in 2013
Cash = $38 million
$136 million available on revolver
Strong cash flow
Adjusted EBITDA (LTM) of $94 million
Strong Financial Condition
____________________
Note: As of 7/3/09
24
Well Positioned for the Future
Leading Brand Names
Generating Aftermarket
Sales and Services
Experienced Management
Team in Place to Grow
Organically and Through
Strategic Acquisitions
Global Leader in Specialty
Fluid Handling Products
Proven Application
Expertise in Solving
Critical Customer Needs
Serving
Growing Infrastructure
Driven End Markets
CBS-Driven Culture Focused
on Profitable Sales Growth
25
Appendix
26
Adjusted net income, adjusted net income per share, adjusted operating income and adjusted EBITDA exclude asbestos
liability and defense costs (income) and asbestos coverage litigation expenses, certain
legacy legal charges, restructuring
and other related charges, certain due diligence costs, certain other post-employment benefit settlement, cross currency
swap, environmental indemnification and discontinued operations expense (income), as well as
one time initial public
offering-related costs to the extent they impact the periods presented. Adjusted selling, general and administrative expenses
exclude legacy legal adjustments. Adjusted net income also reflects interest expense as
if the initial public offering (IPO) had
occurred at the beginning of 2007 and presents income taxes at an effective tax rate of 32% in 2009 and 34% in 2008. Adjusted
net income per share in 2008 assumes the 44,006,026 shares outstanding at the closing
of the IPO to be outstanding since
January 1, 2007. Projected adjusted net income per share excludes actual and estimated restructuring and other related
charges, asbestos coverage litigation expenses and asbestos liability and defense costs. Organic
sales growth (decline) and
organic order growth (decline) exclude the impact of foreign exchange rate fluctuations and acquisitions. These non-GAAP
financial measures assist Colfax in comparing its operating performance on a consistent basis because,
among other things,
they remove the impact of changes in our capital structure and asset base, non-recurring items such as IPO-related costs,
legacy asbestos issues (except in the case of EBITDA) and items outside the control of its operating management
team.
Sales and order information by end market are estimates. We periodically update our customer groupings in order to refine
these estimates. During 2009, reclassifications of previously
reported amounts were made to conform to current period
presentation. No changes have been made to total sales or orders.
Disclaimer
27
Non-GAAP Reconciliation
____________________
Note: Dollars in thousands.
2008
2007
2006
2005
EBITDA
Net (loss) income
(571)
$
64,882
$
94
$
12,247
$
Interest expense
11,822
19,246
14,186
9,026
Provision for income taxes
5,438
39,147
3,866
6,907
Depreciation and amortization
14,788
15,239
11,481
11,430
EBITDA
31,477
$
138,514
$
29,627
$
39,610
$
EBITDA margin
5.2%
27.4%
7.5%
11.5%
Adjusted EBITDA
Net (loss) income
(571)
$
64,882
$
94
$
12,247
$
Interest expense
11,822
19,246
14,186
9,026
Provision for income taxes
5,438
39,147
3,866
6,907
Depreciation and amortization
14,788
15,239
11,481
11,430
Legacy asbestos expense (income)
12,391
(50,346)
33,816
18,112
IPO - related costs
57,017
-
-
-
Legacy legal expenses
4,131
-
8,330
3,100
Due diligence costs
582
-
-
-
Other post-employment benefit settlement
-
-
(9,102)
(251)
Cross currency swap
-
-
-
(2,075)
Environmental indemnification
-
-
-
(3,100)
Discontinued operations
-
-
1,397
(616)
Adjusted EBITDA
105,598
$
88,168
$
64,068
$
54,780
$
Adjusted EBITDA margin
17.5%
17.4%
16.3%
15.9%
28
Sales & Order Growth
____________________
Note: Dollars in millions.
$
%
$
%
Year Ended December 31, 2005
345.5
$
370.4
$
Components of Growth:
Organic Growth from Existing Businesses
40.7
11.8%
65.6
17.7%
Acquisitions
4.8
1.4%
4.4
1.2%
Foreign Currency Translation
2.6
0.8%
1.9
0.5%
Total Growth
48.1
13.9%
71.9
19.4%
Year Ended December 31, 2006
393.6
$
442.3
$
Components of Growth:
Organic Growth from Existing Businesses
53.3
13.5%
77.7
17.6%
Acquisitions
31.3
8.0%
27.2
6.1%
Foreign Currency Translation
28.1
7.1%
34.3
7.8%
Total Growth
112.7
28.6%
139.2
31.5%
Year Ended December 31, 2007
506.3
$
581.5
$
Components of Growth:
Organic Growth from Existing Businesses
70.2
13.9%
40.9
7.0%
Acquisitions
5.5
1.1%
11.7
2.0%
Foreign Currency Translation
22.9
4.5%
35.1
6.1%
Total Growth
98.6
19.5%
87.7
15.1%
Year Ended December 31, 2008
604.9
$
669.2
$
Sales
Orders
29
____________________
Note: Dollars in thousands.
Non-GAAP Reconciliation
July 3, 2009
June 27, 2008
July 3, 2009
June 27, 2008
EBITDA
Net income (loss)
4,366
$
(31,399)
$
11,227
$
(24,601)
$
Interest expense
1,786
3,236
3,632
7,733
Provision (benefit) for income taxes
2,142
(12,679)
5,245
(9,101)
Depreciation and amortization
3,538
3,955
6,911
7,650
EBITDA
11,832
$
(36,887)
$
27,015
$
(18,319)
$
EBITDA margin
9.2%
(22.9)%
10.2%
(6.3)%
Adjusted EBITDA
Net income (loss)
4,366
$
(31,399)
$
11,227
$
(24,601)
$
Interest expense
1,786
3,236
3,632
7,733
Provision for income taxes
2,142
(12,679)
5,245
(9,101)
Depreciation and amortization
3,538
3,955
6,911
7,650
Restructuring and other related charges
486
-
1,147
-
IPO-related costs
-
57,017
-
57,017
Legacy legal adjustment
-
4,131
-
4,131
Asbestos liability and defense costs (income)
1,482
(715)
3,127
(437)
Asbestos coverage litigation expense
4,027
3,970
6,993
7,109
Adjusted EBITDA
17,827
$
27,516
$
38,282
$
49,501
$
Adjusted EBITDA margin
13.8%
17.0%
14.4%
16.9%
Three Months Ended
Six Months Ended
30
____________________
Note: Dollars in thousands, except per share amounts.
Non-GAAP Reconciliation
July 3, 2009
June 27, 2008
July 3, 2009
June 27, 2008
Adjusted Net Income and Adjusted Earnings per Share
Net income (loss)
4,366
$
(31,399)
$
11,227
$
(24,601)
$
Restructuring and other related charges
486
-
1,147
-
IPO-related costs
-
57,017
-
57,017
Legacy legal adjustment
-
4,131
-
4,131
-
Asbestos liability and defense costs
1,482
(715)
3,127
(437)
Asbestos coverage litigation expense
4,027
3,970
6,993
7,109
Interest adjustment to effect IPO at beginning of period
-
725
-
2,302
Tax adjustment to effective rate of 32% and 34%, respectively
(1,859)
(19,836)
(3,631)
(21,484)
Adjusted net income
8,502
$
13,893
$
18,863
$
24,037
$
Adjusted net income margin
6.6%
8.6%
7.1%
8.2%
Weighted average shares outstanding - diluted
43,245,990
-
43,237,856
-
Shares outstanding at closing of IPO
-
44,006,026
-
44,006,026
Adjusted net income per share
0.20
$
0.32
$
0.44
$
0.55
$
Net income per share-basic
and diluted in accordance with GAAP
0.10
$
(1.01)
$
0.26
$
(0.99)
$
Adjusted Operating Income
Operating income (loss)
8,294
$
(40,842)
$
20,104
$
(25,969)
$
Restructuring and other related charges
486
-
1,147
-
IPO-related costs
-
57,017
-
57,017
Legacy legal adjustment
-
4,131
-
4,131
Asbestos liability and defense costs
1,482
(715)
3,127
(437)
Asbestos coverage litigation expense
4,027
3,970
6,993
7,109
Adjusted operating income
14,289
$
23,561
$
31,371
$
41,851
$
Adjusted operating income margin
11.1%
14.6%
11.8%
14.3%
Three Months Ended
Six Months Ended
31
____________________
Note: Dollars in thousands.
Non-GAAP Reconciliation
July 3, 2009
June 27, 2008
July 3, 2009
June 27, 2008
Adjusted SG&A Expense
Selling, general and administrative expenses
28,586
$
35,776
$
58,112
$
64,283
$
Legacy legal adjustment
-
4,131
-
4,131
Adjusted selling, general and administrative expenses
28,586
$
31,645
$
58,112
$
60,152
$
22.1%
19.6%
21.9%
20.6%
Three Months Ended
Six Months Ended
32
____________________
Note: Dollars in millions.
Sales & Order Growth
$
%
$
%
Three Months Ended June 27, 2008
161.4
$
188.8
$
Components of Growth:
Existing Businesses
(16.4)
(10.2)%
(72.3)
(38.3)%
Foreign Currency Translation
(15.8)
(9.8)%
(12.4)
(6.6)%
Total Growth
(32.2)
(20.0)%
(84.7)
(44.9)%
Three Months Ended July 3, 2009
129.2
$
104.1
$
Backlog
at
$
%
$
%
Period
End
Six Months Ended June 27, 2008
292.1
$
369.1
$
384.0
$
Components of Growth:
Existing Businesses
7.0
2.4%
(118.2)
(32.0)%
(63.8)
(16.6)%
Foreign Currency Translation
(33.6)
(11.5)%
(26.0)
(7.0)%
(27.9)
(7.3)%
Total Growth
(26.6)
(9.1)%
(144.2)
(39.1)%
(91.7)
(23.9)%
Six Months Ended July 3, 2009
265.5
$
224.9
$
292.3
$
Sales
Orders
Sales
Orders
33