DOVER CORPORATION DOWNERS GROVE, Ill., April 21, 2015 /PRNewswire/ -- Dover (NYSE: DOV) announced today that for the first quarter ended March 31, 2015, revenue was $1.7 billion, a decrease of 5% from the prior year. The decrease in revenue was driven by an organic revenue decline of 6% and a 4% unfavorable impact from foreign exchange, offset in part by 5% growth from acquisitions. Earnings from continuing operations were $117.2 million, a decrease of 31% as compared to $170.0 million for the prior year period. Diluted earnings per share ("EPS") for the first quarter ended March 31, 2015 was $0.72, compared to $0.99 EPS in the prior year period, representing a decrease of 27%. Excluding discrete tax benefits recognized in the prior year period, EPS from continuing operations for the first quarter of 2015 decreased 26% from an adjusted EPS of $0.97 in the prior year period.
Commenting on the first quarter results, Dover's President and Chief Executive Officer, Robert A. Livingston, said, "Our businesses continued to perform well against the backdrop of significant headwinds in our energy-related markets, as well as the ongoing FX impact of the strengthening US dollar and slower than expected activity in our core refrigeration case and systems markets. To better align our costs with anticipated demand, we incurred $24 million in restructuring charges in the quarter, primarily in Energy. These restructuring actions were in addition to $37 million in charges incurred in the fourth quarter of 2014. We expect to pursue additional cost reduction actions as we move through the year."
"As we deal with these headwinds we will remain focused on growth investments, as well as investment in productivity initiatives, including supply chain optimization and shared infrastructure. I am confident the combination of these actions positions us well to continue our long-term track record of strong performance."
"Looking forward, we are re-affirming our recently updated 2015 guidance. We expect full-year revenue to decline 4% to 6%. Within our revenue forecast, organic growth is anticipated to decline 2% to 4%, completed acquisitions will provide approximately 2% growth, and FX is expected to be a 4% headwind. In total, full year adjusted EPS is expected to be in the range of $4.20 to $4.40, inclusive of $0.15 to $0.18 of restructuring charges."
Net earnings for the quarter ended March 31, 2015, were $209.5 million, or $1.28 EPS, which included earnings from discontinued operations of $92.3 million, or $0.57 EPS, compared to net earnings of $160.1 million, or $0.93 EPS, for the same period of 2014, which included a loss from discontinued operations of $9.9 million, or $0.06 EPS. First quarter 2015 earnings from discontinued operations included a gain of $87.4 million, or $0.53 EPS, resulting from the disposition of a business held for sale.
Dover will host a webcast of its first quarter 2015 conference call at 10:00 A.M. Eastern Time (9:00 A.M. Central Time) on Tuesday, April 21, 2015. The webcast can be accessed on the Dover website at www.dovercorporation.com. The conference call will also be made available for replay on the website. Additional information on Dover's first quarter results and its operating segments can also be found on the Company's website.
About Dover:
Dover is a diversified global manufacturer with annual revenues approaching $7.5 billion. We deliver innovative equipment and components, specialty systems and support services through four major operating segments: Energy, Engineered Systems, Fluids, and Refrigeration & Food Equipment. Dover combines global scale with operational agility to lead the markets we serve. Recognized for our entrepreneurial approach for 60 years, our team of 26,000 employees takes an ownership mindset, collaborating with customers to redefine what's possible. Headquartered in Downers Grove, Illinois, Dover trades on the New York Stock Exchange under "DOV." Additional information is available at www.dovercorporation.com.
Forward-Looking Statements:
This press release contains "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Such statements relate to, among other things, operating and strategic plans, income, earnings, cash flows, changes in operations, industries in which Dover businesses operate, anticipated market conditions and our positioning, global economies, and operating improvements. Forward-looking statements may be indicated by words or phrases such as "anticipates," "expects," "believes," "suggests," "will," "plans," "should," "would," "could," and "forecast", or the use of the future tense and similar words or phrases. Forward-looking statements are subject to inherent risks and uncertainties that could cause actual results to differ materially from current expectations, including, but not limited to, oil and natural gas demand, production growth, and prices; changes in exploration and production spending by Dover's customers and changes in the level of oil and natural gas exploration and development; economic conditions generally and changes in economic conditions globally and in markets served by Dover businesses, including well activity and U.S. industrials activity; Dover's ability to achieve expected savings from integration and other cost-control initiatives, such as lean and productivity programs as well as efforts to reduce sourcing input costs; the impact of interest rate and currency exchange rate fluctuations; the ability of Dover's businesses to expand into new geographic markets; Dover's ability to identify and successfully consummate value-adding acquisition opportunities or planned divestitures; changes in customer demand or the impact of loss of a significant customer, or loss or non-renewal of significant contracts; the ability of Dover's businesses to develop and launch new products, timing of such launches and risks relating to market acceptance by customers; the relative mix of products and services which impacts margins and operating efficiencies; increased competition and pricing pressures; the impact of loss of a single-source manufacturing facility; short-term capacity constraints; increases in the cost of raw materials; domestic and foreign governmental and public policy changes or developments, including environmental regulations, conflict minerals disclosure requirements, and tax policies; protection and validity of patent and other intellectual property rights; the impact of legal matters and legal compliance risks; conditions and events affecting domestic and global financial and capital markets; and a downgrade in Dover's credit ratings which, among other matters, could make obtaining financing more difficult and costly. Dover refers you to the documents that it files from time to time with the Securities and Exchange Commission, such as its reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other risks and uncertainties that could cause its actual results to differ materially from its current expectations and from the forward-looking statements contained herein. Dover undertakes no obligation to update any forward-looking statement, except as required by law.
INVESTOR SUPPLEMENT - FIRST QUARTER 2015
DOVER CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
(unaudited)(in thousands, except per share data)
-----------------------------------------------
Three Months Ended March 31,
----------------------------
2015 2014
---- ----
Revenue $1,715,501 $1,802,570
Cost of
goods
and
services 1,088,342 1,094,710
--------- ---------
Gross
profit 627,159 707,860
Selling
and
administrative
expenses 434,634 433,404
------- -------
Operating
earnings 192,525 274,456
Interest
expense,
net 32,037 32,655
Other
(income)
expense,
net (4,187) 191
------ ---
Earnings
before
provision
for
income
taxes
and
discontinued
operations 164,675 241,610
Provision
for
income
taxes 47,485 71,569
------ ------
Earnings
from
continuing
operations 117,190 170,041
Earnings
(loss)
from
discontinued
operations,
net 92,320 (9,903)
Net
earnings $209,510 $160,138
======== ========
Basic earnings per common
share:
Earnings
from
continuing
operations $0.72 $1.00
Earnings
(loss)
from
discontinued
operations,
net 0.57 (0.06)
Net
earnings 1.30 0.94
Weighted
average
shares
outstanding 161,650 169,750
======= =======
Diluted earnings per common
share:
Earnings
from
continuing
operations $0.72 $0.99
Earnings
(loss)
from
discontinued
operations,
net 0.57 (0.06)
Net
earnings 1.28 0.93
Weighted
average
shares
outstanding 163,323 172,013
======= =======
Dividends
paid
per
common
share $0.40 $0.375
===== ======
DOVER CORPORATION
QUARTERLY SEGMENT INFORMATION
(unaudited)(in thousands)
2015 2014
---- ----
Q1 Q1 Q2 Q3 Q4 FY 2014
--- --- --- --- --- -------
REVENUE
-------
Energy $430,423 $478,773 $481,016 $507,334 $550,116 $2,017,239
-------- -------- -------- -------- -------- ----------
Engineered Systems
Printing & Identification 230,181 231,679 252,354 257,282 247,569 988,884
Industrials 343,015 335,995 361,467 355,019 344,600 1,397,081
------- ------- ------- ------- ------- ---------
573,196 567,674 613,821 612,301 592,169 2,385,965
------- ------- ------- ------- ------- ---------
Fluids 340,236 345,009 346,275 361,797 377,485 1,430,566
------- ------- ------- ------- ------- ---------
Refrigeration & Food Equipment 372,097 411,493 522,357 528,807 458,532 1,921,189
------- ------- ------- ------- ------- ---------
Intra-segment eliminations (451) (379) (833) (664) (355) (2,231)
---- ---- ---- ---- ---- ------
Total consolidated revenue $1,715,501 $1,802,570 $1,962,636 $2,009,575 $1,977,947 $7,752,728
========== ========== ========== ========== ========== ==========
NET EARNINGS
------------
Segment Earnings:
Energy $52,305 $118,968 $114,991 $122,738 $105,118 $461,815
Engineered Systems 88,149 83,227 101,766 108,800 93,205 386,998
Fluids 54,634 57,942 63,112 67,559 63,026 251,639
Refrigeration & Food Equipment 36,150 44,862 84,926 78,012 30,934 238,734
------ ------ ------ ------ ------ -------
Total Segments 231,238 304,999 364,795 377,109 292,283 1,339,186
Corporate expense / other 34,526 30,734 29,287 27,815 29,964 117,800
Net interest expense 32,037 32,655 31,961 31,231 31,332 127,179
------ ------ ------ ------ ------ -------
Earnings from continuing operations before provision for income
taxes 164,675 241,610 303,547 318,063 230,987 1,094,207
Provision for income taxes 47,485 71,569 92,966 92,380 59,152 316,067
------ ------ ------ ------ ------ -------
Earnings from continuing operations 117,190 170,041 210,581 225,683 171,835 778,140
Earnings (loss) from discontinued operations, net 92,320 (9,903) 3,378 6,161 (2,541) (2,905)
------
Net earnings $209,510 $160,138 $213,959 $231,844 $169,294 $775,235
======== ======== ======== ======== ======== ========
SEGMENT OPERATING MARGIN
------------------------
Energy 12.2% 24.8% 23.9% 24.2% 19.1% 22.9%
Engineered Systems 15.4% 14.7% 16.6% 17.8% 15.7% 16.2%
Fluids 16.1% 16.8% 18.2% 18.7% 16.7% 17.6%
Refrigeration & Food Equipment 9.7% 10.9% 16.3% 14.8% 6.7% 12.4%
Total Segment 13.5% 16.9% 18.6% 18.8% 14.8% 17.3%
DEPRECIATION AND AMORTIZATION EXPENSE
-------------------------------------
Energy $34,427 $25,575 $25,807 $27,145 $33,429 $111,956
Engineered Systems 14,526 15,850 15,982 15,334 14,780 61,946
Fluids 13,848 16,366 15,308 14,019 15,210 60,903
Refrigeration & Food Equipment 16,458 17,212 17,451 17,073 16,965 68,701
Corporate 923 870 1,000 910 902 3,682
$80,182 $75,873 $75,548 $74,481 $81,286 $307,188
======= ======= ======= ======= ======= ========
DOVER CORPORATION
QUARTERLY SEGMENT INFORMATION
(continued)
(unaudited)(in thousands)
2015 2014
---- ----
Q1 Q1 Q2 Q3 Q4 FY 2014
--- --- --- --- --- -------
BOOKINGS
--------
Energy $416,628 $478,469 $477,162 $526,134 $534,646 $2,016,411
-------- -------- -------- -------- -------- ----------
Engineered Systems
Printing & Identification 235,636 250,434 245,445 249,299 248,082 993,260
Industrials 337,070 370,949 363,773 342,687 374,438 1,451,847
Eliminations (19) (18) (16) (11) (11) (56)
--- --- --- --- --- ---
572,687 621,365 609,202 591,975 622,509 2,445,051
------- ------- ------- ------- ------- ---------
Fluids 339,310 362,943 375,009 350,853 345,553 1,434,358
------- ------- ------- ------- ------- ---------
Refrigeration & Food Equipment 419,659 493,731 542,810 459,099 367,567 1,863,207
------- ------- ------- ------- ------- ---------
Intra-segment eliminations (628) (506) (1,089) (737) (644) (2,976)
---- ---- ------ ---- ---- ------
Total consolidated bookings $1,747,656 $1,956,002 $2,003,094 $1,927,324 $1,869,631 $7,756,051
========== ========== ========== ========== ========== ==========
BACKLOG
-------
Energy $212,060 $210,846 $206,415 $232,739 $233,347
-------- -------- -------- -------- --------
Engineered Systems
Printing & Identification 108,151 131,298 128,912 115,352 110,359
Industrials 276,598 266,517 268,680 254,612 282,598
384,749 397,815 397,592 369,964 392,957
------- ------- ------- ------- -------
Fluids 259,504 328,617 348,508 323,424 277,834
------- ------- ------- ------- -------
Refrigeration & Food Equipment 337,084 431,298 450,065 376,141 282,507
------- ------- ------- ------- -------
Intra-segment eliminations (595) (374) (211) (302) (431)
---- ---- ---- ---- ----
Total consolidated backlog $1,192,802 $1,368,202 $1,402,369 $1,301,966 $1,186,214
========== ========== ========== ========== ==========
DOVER CORPORATION
QUARTERLY EARNINGS PER SHARE
(unaudited)(in thousands, except per share data*)
2015 2014
---- ----
Q1 Q1 Q2 Q3 Q4 FY 2014
--- --- --- --- --- -------
Basic earnings
(loss) per common share:
Continuing operations $0.72 $1.00 $1.26 $1.36 $1.04 $4.67
Discontinued operations 0.57 (0.06) 0.02 0.04 (0.02) (0.02)
Net earnings 1.30 0.94 1.29 1.40 1.03 4.65
Diluted earnings (loss) per common share:
Continuing operations $0.72 $0.99 $1.25 $1.34 $1.03 $4.61
Discontinued operations 0.57 (0.06) 0.02 0.04 (0.02) (0.02)
Net earnings 1.28 0.93 1.27 1.38 1.02 4.59
Adjusted diluted earnings per common share (calculated below):
Continuing operations $0.72 $0.97 $1.25 $1.31 $1.01 $4.54
Net earnings (loss) and average shares used in calculated earnings (loss) per share amounts are as follows:
Net earnings (loss):
Continuing operations $117,190 $170,041 $210,581 $225,683 $171,835 $778,140
Discontinued operations 92,320 (9,903) 3,378 6,161 (2,541) (2,905)
Net earnings 209,510 160,138 213,959 231,844 169,294 775,235
Average shares
outstanding:
Basic 161,650 169,750 166,474 166,021 164,589 166,692
Diluted 163,323 172,013 168,857 168,343 166,467 168,842
Note:
Earnings from continuing operations are adjusted by discrete tax items and other one-time gains to derive adjusted earnings from continuing operations and adjusted diluted earnings per common share as follows:
2015 2014
---- ----
Q1 Q1 Q2 Q3 Q4 FY 2014
--- --- --- --- --- -------
Adjusted earnings from
continuing operations:
Earnings from continuing operations $117,190 $170,041 $210,581 $225,683 $171,835 $778,140
Gains (losses) from discrete and other tax items - 2,541 (635) 5,524 3,860 11,290
Adjusted earnings from continuing operations $117,190 $167,500 $211,216 $220,159 $167,975 $766,850
======== ======== ======== ======== ======== ========
Adjusted diluted earnings
per common share:
Earnings from continuing operations $0.72 $ $0.99 $1.25 $1.34 $1.03 $4.61
Gains (losses) from discrete and other tax items - 0.01 - 0.03 0.02 0.07
Adjusted earnings from continuing operations $0.72 $ $0.97 $1.25 $1.31 $1.01 $4.54
===== === ===== ===== ===== ===== =====
* Per share data may not add due to rounding.
DOVER CORPORATION
QUARTERLY FREE CASH FLOW
(unaudited)(in thousands)
2015 2014
---- ----
Q1 Q1 Q2 Q3 Q4 FY 2014
--- --- --- --- --- -------
Cash flow from operating activities $131,332 $28,361 $185,013 $292,012 $444,778 $950,164
Less: Additions to property, plant and equipment (27,956) (32,695) (42,550) (33,532) (57,256) (166,033)
Free cash flow $103,376 $(4,334) $142,463 $258,480 $387,522 $784,131
======== ======= ======== ======== ======== ========
Free cash flow as a percentage of earnings from continuing
operations 88.2% (2.5)% 67.7% 114.5% 225.5% 100.8%
Free cash flow as a percentage of revenue 6.0% (0.2)% 7.3% 12.9% 19.6% 10.1%
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SOURCE Dover Corporation
