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Robbins & Myers Announces First Quarter 2011 Results and Dividend Increase

Date : 01/07/2011 @ 8:00AM
Source : PR Newswire (US)
Stock : T-3 Energy Services (MM) (TTES)
Quote : 44.9  0.0 (0.00%) @ 2:05AM
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Robbins & Myers Announces First Quarter 2011 Results and Dividend Increase

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DAYTON, Ohio, Jan. 7, 2011 /PRNewswire/ -- Robbins & Myers, Inc. (NYSE: RBN) today reported diluted net earnings per share (DEPS) of $0.44 for its fiscal first quarter ended November 30, 2010, compared with $0.18 in the prior year first quarter. Consolidated sales were $164 million in the first quarter of 2011, 27% higher than the first quarter of 2010. Each of Robbins & Myers' business platforms achieved significant year-over-year sales growth. Robbins & Myers reported first quarter 2011 orders of $190 million, 38% higher than the comparable prior year period, and backlog grew to $204 million, the highest level in two years.

"We are benefiting from growth in unconventional drilling, which includes both horizontal and directional rigs, as exploration and production companies invest to capture oil and gas from the shale formations," said Peter C. Wallace, President and Chief Executive Officer of Robbins & Myers, Inc.  "This particular portion of the energy markets has been extremely strong, and we have products well-suited for this type of drilling. Other energy market products are experiencing growth, although at more moderate levels. Outside of the energy markets, our businesses continue to benefit from slowly-improving market conditions in developed global regions and higher growth in developing regions. As expected, recent growth in orders is translating into higher sales and profits."

The Company reported first quarter 2011 earnings before interest and taxes (EBIT) of $24 million, significantly higher than the $10 million reported in the first quarter of 2010. Operating margins grew 730 basis points to 14.8%. Each of Robbins & Myer's business platforms achieved profitability in the first quarter of 2011. Most of the Company's first quarter 2011 profits were generated in its Fluid Management Group, which benefitted from an exceptionally strong sales mix.

Based on the strength of served energy markets, the Company is increasing its fiscal 2011 DEPS forecast from $1.45-$1.65 to $1.85-$2.05. The Company expects to earn $0.40-$0.50 in its second quarter of 2011, which includes cost pressures from typical seasonal plant shut-downs. These forecasts exclude restructuring charges and the financial impact from the pending merger with T-3 Energy Services, Inc.

Vote on T-3 Merger Later Today; Integration Preparations Well Underway

As originally announced on November 18, 2010, Robbins & Myers, Inc. and T-3 Energy Services, Inc. (Nasdaq: TTES) are each holding special shareholders meetings to approve the merger of T-3 with a subsidiary of Robbins & Myers.

"Pending shareholder approval later today, we expect to complete the acquisition on Monday, January 10," said Mr. Wallace. "Our integration teams have been actively preparing to bring the two companies together, creating a strategic platform with better scale to support future growth and global expansion. I remain excited about the opportunities this acquisition will create for shareholders, employees and customers."

Dividend Increase

Robbins & Myers also announced today that its Board of Directors approved an increase in the quarterly cash dividend payment from $0.0425 to $0.0450 per share. The dividend is payable on February 18, 2011 to shareholders of record as of January 21, 2011.

Mr. Wallace commented, "I am pleased to announce our fifth consecutive annual dividend increase, reflecting our strong financial position, successful business performance, and strategy to create long-term shareholder value."

First Quarter Results by Segment

All comparisons are made against the comparable year-ago quarterly period unless otherwise stated.

The Company's Fluid Management segment reported orders of $102 million, up 50%, due primarily to strength in energy markets. Sales of $91 million were 34% higher, and EBIT nearly doubled to $28 million. EBIT margins of 30.8% were 630 basis points higher. Ending backlog nearly doubled to $68 million.

The Process Solutions segment reported orders of $54 million, an increase of 29% due to improving demand for capital goods in chemical markets, especially in developing economies. Sales of $49 million were 14% higher, and the business reported $1 million of EBIT in the first quarter of 2011 as compared with a $2 million loss in the prior year first quarter. Backlog expanded for the fifth consecutive quarter, ending the quarter at $85 million.

The Romaco segment had orders of $34 million, an increase of 24% due to continued recoveries in the segment's pharmaceutical, food and other served markets. Backlog grew to $50 million in the first quarter of 2011. Sales increased 31% to $23 million, and EBIT improved from a prior year loss of $1 million to slightly above break-even.

Conference Call to Be Held Today, January 7 at 2:00 PM (Eastern)

A conference call to discuss first quarter 2011 financial results has been scheduled for 2:00 PM Eastern on Friday, January 7, 2011. The call can be accessed at www.robn.com or by dialing 800-901-5241 (US/Canada) or +1-617-786-2963, using conference ID #93307338.  Replays of the call can be accessed by dialing 888-286-8010 (U.S./Canada) or +1-617-801-6888, both using replay ID #38790553.

About Robbins & Myers

Robbins & Myers, Inc. is a leading supplier of engineered equipment and systems for critical applications in global energy, industrial, chemical and pharmaceutical markets.

In this release the Company refers to EBIT, a non-GAAP measure. The Company uses this measure to evaluate its performance and believes this measure is helpful to investors in assessing its performance.  A reconciliation of EBIT to net income is included in our Condensed Consolidated Income Statement.  EBIT is not a measure of cash available for use by the Company.

Forward-Looking Statements

Statements set forth in this press release that are not historical facts, including statements regarding future financial performance, future market demand, future benefits to shareholders, future economic and industry conditions, the proposed merger between R&M and T-3 (including its benefits, results, effects and timing), and whether and when the transactions contemplated by the merger agreement will be consummated, are forward-looking statements within the meaning of the federal securities laws.  These forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond the Company's control, which could cause actual benefits, results, effects and timing to differ materially from the results predicted or implied by the statements.  These risks and uncertainties include, but are not limited to: the failure of the shareholders of R&M or the stockholders of T-3 to approve the merger; potential uncertainties regarding market acceptance of the combined company; competitive responses to the proposed merger; costs and difficulties related to integration of T-3's businesses and operations; the inability to or delay in obtaining cost savings and synergies from the merger; inability to retain key personnel; changes in the demand for or price of oil and/or natural gas; a significant decline in capital expenditures within the markets served by the Company; the ability to realize the benefits of restructuring programs; increases in competition; changes in the availability and cost of raw materials; foreign exchange rate fluctuations as well as economic or political instability in international markets and performance in hyperinflationary environments, such as Venezuela; work stoppages related to union negotiations; customer order cancellations; the possibility of product liability lawsuits that could harm our businesses; events or circumstances which result in an impairment of, or valuation against, assets; the potential impact of U.S. and foreign legislation, government regulations, and other governmental action, including those relating to export and import of products and materials, and changes in the interpretation and application of such laws and regulations; the outcome of audit, compliance, administrative or investigatory reviews; proposed changes in U.S. tax law which could impact our future tax expense and cash flow; decline in the market value of our pension plan investment portfolios; and other important risk factors discussed more fully in R&M's reports on Form 10-K for the year ended August 31, 2010; its recent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K; the joint proxy statement/prospectus filed with the Securities and Exchange Commission ("SEC") on November 29, 2010; and other reports filed from time to time with the SEC.  R&M does not undertake any obligation to revise or update publicly any forward-looking statements for any reason.

Additional Information

In connection with the proposed merger, R&M filed a registration statement on Form S-4 (333-17052) with the SEC that includes a joint proxy statement of R&M and T-3 and a prospectus of R&M.  INVESTORS AND SECURITY HOLDERS ARE URGED TO CAREFULLY READ THE REGISTRATION STATEMENT AND THE RELATED JOINT PROXY STATEMENT/PROSPECTUS BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT R&M, T-3 AND THE PROPOSED MERGER.  Investors and security holders may obtain a free copy of the registration statement and the joint proxy statement/prospectus and other documents containing information about R&M and T-3, without charge, at the SEC's web site at www.sec.gov.  Copies of R&M's SEC filings also may be obtained for free by directing a request to Robbins & Myers, Inc., 51 Plum Street, Suite 260, Dayton, Ohio 45440, +1-(937)-458-6600.  Copies of T-3's SEC filings also may be obtained for free by directing a request to T-3 Energy Services, Inc., 7135 Ardmore, Houston, Texas 77054, +1-713-996-4110.

Participants in the Solicitation

R&M and T-3 and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from their respective stockholders in respect of the proposed merger.  Information about these persons can be found in R&M's Annual Report on Form 10-K for its fiscal year ended August 31, 2010, as filed with the SEC on October 26, 2010 and amended on December 23, 2010, T-3's proxy statement relating to its 2010 Annual Meeting of Stockholders, as filed with the SEC on April 30, 2010, T-3's Current Report on Form 8-K filed with the SEC on June 16, 2010, and the joint proxy statement/prospectus related to the merger, which was filed with the SEC on November 29, 2010.  These documents can be obtained free of charge from the sources indicated above.



ROBBINS & MYERS, INC. AND SUBSIDIARIES











CONDENSED CONSOLIDATED BALANCE SHEET













(Unaudited)



























(in thousands)



November 30, 2010



August 31, 2010



ASSETS















Current Assets:















Cash and cash equivalents



$144,209



$149,213







Accounts receivable



123,687



115,387







Inventories



112,453



97,939







Other current assets



7,521



7,589







Deferred taxes



14,290



14,164







 Total Current Assets



402,160



384,292





















Goodwill & Other Intangible Assets



269,416



264,106





Deferred Taxes



34,589



33,932





Other Assets



9,568



10,091





Property, Plant & Equipment



126,776



124,600











$842,509



$817,021



LIABILITIES AND EQUITY













Current Liabilities:















Accounts payable



$66,249



$66,562







Accrued expenses



91,829



90,345







Current portion of long-term debt



140



192







 Total Current Liabilities



158,218



157,099





















Long-Term Debt - Less Current Portion



98



93





Deferred Taxes



42,738



42,568





Other Long-Term Liabilities



131,583



126,237





Total Equity



509,872



491,024











$842,509



$817,021





ROBBINS & MYERS, INC. AND SUBSIDIARIES



CONDENSED CONSOLIDATED INCOME STATEMENT





(Unaudited)



















Three Months Ended











November 30,



November 30,

(in thousands,  except per share data)



2010



2009















Sales





$163,949



$129,413

Cost of sales



101,778



86,379

Gross profit



62,171



43,034

SG&A expenses



37,975



33,298

Income before interest and income taxes



24,196



9,736

Interest (income) expense, net



(25)



143

Income before income taxes



24,221



9,593

Income tax expense



9,129



3,367

Net income including noncontrolling interest



15,092



6,226

Less: Net income attributable to noncontrolling interest

396



196

Net income attributable to Robbins & Myers, Inc.



$14,696



$6,030

















Net income per share:











Basic





$0.45



$0.18



Diluted





$0.44



$0.18

















Weighted average common shares outstanding:











Basic





32,971



32,872



Diluted





33,087



32,911





ROBBINS & MYERS, INC. AND SUBSIDIARIES

CONDENSED BUSINESS SEGMENT INFORMATION

(Unaudited)























Three Months Ended













November 30,



November 30,

(in thousands)





2010



2009





















Customer Sales















Fluid Management



$91,336



$68,188





Process Solutions



49,434



43,533





Romaco





23,179



17,692





Total







$163,949



$129,413





















Income Before Interest and Income Taxes (EBIT)











Fluid Management



$28,165



$16,734





Process Solutions



1,119



(1,651)





Romaco





92



(758)





Corporate and Eliminations



(5,180)



(4,589)





Total







$24,196



$9,736





















Depreciation and Amortization













Fluid Management



$1,978



$2,047





Process Solutions



1,182



1,483





Romaco





659



578





Corporate and Eliminations



72



86





Total







$3,891



$4,194





















Customer Orders















Fluid Management



$102,226



$68,107





Process Solutions



54,045



41,914





Romaco





33,517



27,134





Total







$189,788



$137,155





















Backlog

















Fluid Management



$68,322



$35,162





Process Solutions



85,247



60,295





Romaco





50,036



51,410





Total







$203,605



$146,867





















Note: EBIT is a non-GAAP measure.  The Company uses this measure to evaluate its performance and believes this measure is helpful to investors in assessing its performance. A reconciliation of this measure to net income is included in our Condensed Consolidated Income Statement. EBIT is not a measure of cash available for use by the Company.





ROBBINS & MYERS, INC. AND SUBSIDIARIES





CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS





(Unaudited)





























Three Months Ended

(in thousands)



November 30,

2010



November 30,

2009

















Operating activities:











  Net income including noncontrolling interest

$15,092



$6,226

  Depreciation and amortization

3,891



4,194

  Working capital and other changes, net

(21,493)



870

Cash (used) provided by operating activities

(2,510)



11,290





















Investing activities:











  Capital expenditures, net of nominal disposals

(3,100)



(2,182)

Cash used by investing activities

(3,100)



(2,182)





















Financing activities:











  (Payments) proceeds of long-term debt, net

(47)



1,286

  Dividends paid







(1,405)



(1,314)

  Other, net









323



111

Cash (used) provided by financing activities

(1,129)



83

Exchange rate impact on cash

1,735



1,750

(Decrease) increase in cash



(5,004)



10,941

Cash at beginning of period



149,213



108,169

Cash at end of period



$144,209



$119,110





SOURCE Robbins & Myers, Inc.

Copyright 2011 PR Newswire



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