IDEX Corporation (NYSE: IEX) today announced its financial
results for the three month period ended September 30,
2016.
Third Quarter 2016
Highlights
- Orders were up 9 percent overall and up
2 percent organically
- Sales were up 5 percent overall and
down 2 percent organically
- Reported EPS was 91 cents and adjusted
EPS was 92 cents, up 3 percent
- Cash from operations of $125 million
drove free cash flow of $114 million
- Acquired AWG Fittings and SFC Koenig
for $288 million
- Divested two non-strategic product
lines in the third quarter and one in early October
Third Quarter 2016
Orders of $530 million were up 9 percent (+2 percent organic, +8
percent acquisitions/divestitures and -1 percent foreign currency
translation) compared with the prior year period.
Sales of $530 million were up 5 percent (-2 percent organic, +8
percent acquisitions/divestitures and -1 percent foreign currency
translation) compared with the prior year period.
Gross margin of 43.5 percent was down 80 basis points from the
prior year period, primarily due to $4.6 million of pre-tax fair
value inventory step-up charges related to the AWG and SFC
acquisitions.
Operating income of $109 million resulted in an operating margin
of 20.5 percent. Adjusted for a $2.1 million pre-tax net loss on
divestitures, adjusted operating income was $111 million with an
adjusted operating margin of 20.9 percent, down 60 basis points
from the prior year adjusted operating margin primarily due to the
fair value inventory step-up charges. Operating income drove EBITDA
of $133 million which was 25 percent of sales and covered interest
expense by more than 11 times.
Net income was $70 million which drove EPS of 91 cents. Adjusted
for the net loss on divestitures, adjusted EPS of 92 cents
increased 3 cents, or 3 percent, from prior year adjusted EPS.
During the third quarter, we utilized $125 million of our global
cash balances to partially fund the recent acquisitions. The usage
of this cash resulted in a $5.2 million foreign withholding tax
charge. Partially offsetting this incremental income tax expense
was a favorable return-to-provision adjustment and other tax
benefits, resulting in an effective tax rate of 29.6 percent
compared to our prior tax rate guidance of 27.0 percent for the
third quarter.
Cash from operations of $125 million was up 11 percent and drove
free cash flow of $114 million which was 163 percent of net
income.
“Orders grew 2 percent organically from strength in scientific and
commercial markets, while industrial markets continued to face
headwinds. Our team continued to execute extremely well in a
challenging macro environment and our businesses are positioned to
continue to perform. This performance is reflected in our strong
third quarter cash conversion of 163 percent of net income and
adjusted EPS of 92 cents, which includes 4 cents of fair value
inventory step-up charges and a higher than expected effective tax
rate, partially offset by favorable foreign exchange. During
the quarter, we deployed significant capital and resources to
expand and optimize our portfolio. We completed the acquisitions of
AWG and SFC, perfect complements to our Fire & Rescue and
Sealing platforms. Year-to-date, we have deployed over $500 million
on three strategic acquisitions and more recently, we have divested
three non-strategic product lines. We will continue to use our
healthy balance sheet and cash flow to invest aggressively in
organic growth, fund disciplined M&A, pay consistent
shareholder dividends and opportunistically repurchase stock.
In the face of continued market softness we expect to close
out 2016 with solid execution and anticipate fourth quarter EPS of
92 to 94 cents. For the full year, we project total sales to be up
5 percent with organic revenue down 1 percent. Despite fourth
quarter pressure from our recent product line divestitures and the
SFC acquisition, including a 5 cent impact from the remaining fair
value inventory step-up charge, we are maintaining the midpoint of
our adjusted full year EPS guidance of $3.72 to $3.74, up 5 percent
from the prior year.” Andrew K. Silvernail Chairman and
Chief Executive Officer
Third Quarter 2016 Segment
Highlights
Fluid & Metering Technologies
- Sales of $208 million reflected a 2
percent decrease compared to the third quarter of 2015 (flat
organic, -1 percent divestitures and -1 percent foreign currency
translation).
- Operating income of $56 million was $6
million higher than the prior year adjusted operating income.
Operating margin of 26.7 percent represented a 340 basis point
increase compared with the prior year adjusted operating margin
primarily due to a $2.5 million pre-tax fair value inventory
step-up charge included in the prior year.
- EBITDA of $63 million resulted in an
EBITDA margin of 30.2 percent, a 340 basis point increase compared
with prior year adjusted EBITDA.
Health & Science Technologies
- Sales of $184 million reflected a 1
percent decrease compared to the third quarter of 2015 (-1 percent
organic, +2 percent acquisitions and -2 percent foreign currency
translation).
- Operating income of $37 million was $3
million lower than the prior year adjusted operating income.
Operating margin of 20.3 percent represented a 140 basis point
decrease compared with the prior year adjusted operating margin
primarily due to the $2.9 million pre-tax fair value inventory
step-up charge related to the SFC acquisition.
- EBITDA of $49 million resulted in an
EBITDA margin of 26.6 percent, a 160 basis point decrease compared
with prior year adjusted EBITDA.
Fire & Safety/Diversified Products
- Sales of $139 million reflected a 30
percent increase compared to the third quarter of 2015 (-6 percent
organic, +38 percent acquisition and -2 percent foreign currency
translation).
- Operating income of $32 million was $1
million lower than the prior year adjusted operating income.
Operating margin of 23.2 percent represented a 750 basis point
decrease compared with the prior year adjusted operating margin
primarily due to the dilutive impact of the 2016 acquisitions and
the $1.7 million pre-tax fair value inventory step-up charge
related to the AWG acquisition.
- EBITDA of $36 million resulted in an
EBITDA margin of 26.1 percent, a 620 basis point decrease compared
with prior year adjusted EBITDA.
For the third quarter of 2016, Fluid & Metering Technologies
contributed 39 percent of sales, 44 percent of operating income and
43 percent of EBITDA; Health & Science Technologies accounted
for 35 percent of sales, 30 percent of operating income and 33
percent of EBITDA; and Fire & Safety/Diversified Products
represented 26 percent of sales, 26 percent of operating income and
24 percent of EBITDA.
Fourth Quarter Pension
Settlement
IDEX has implemented a program offering certain former U.S.
employees with a vested pension benefit an option to take a
one-time lump sum distribution rather than future monthly pension
payments. Payments will be made from the retirement plans during
the fourth quarter of 2016. This action is expected to reduce
IDEX’s pension benefit obligations by approximately $8
million by December 31, 2016.
This is part of IDEX’s overall plan to de-risk its pension plans
and will not materially impact the plans’ funded status, materially
impact future pension expense, or require additional contributions
to the plans. Based on the estimated number of participants, IDEX
expects to recognize a pretax pension settlement charge in the
range of $3 million to $6 million in the fourth quarter
of 2016. This settlement charge is excluded from our fourth
quarter and full year guidance.
Non-U.S. GAAP Measures of Financial
Performance
The Company supplements certain U.S. GAAP financial performance
metrics with non-U.S. GAAP financial performance metrics in order
to provide investors with better insight and increased transparency
while also allowing for a more comprehensive understanding of the
financial information used by management in its decision making.
Reconciliations of non-U.S. GAAP financial performance metrics to
their most comparable U.S. GAAP financial performance metrics are
defined and presented below and should not be considered a
substitute for, nor superior to, the financial data prepared in
accordance with U.S. GAAP. There were no adjustments to U.S. GAAP
financial performance metrics other than the items noted below.
- Organic orders and sales are calculated
according to U.S. GAAP excluding amounts from acquired or divested
businesses during the first twelve months of ownership or
divestiture and the impact of foreign currency translation.
- Adjusted operating income is calculated
as operating income plus restructuring expenses plus or minus the
net loss or gain on sale of businesses.
- Adjusted operating margin is calculated
as adjusted operating income divided by net sales.
- Adjusted net income is calculated as
net income plus restructuring expenses plus or minus the loss or
gain on sale of businesses, net of the statutory tax expense or
benefit.
- EBITDA is calculated as net income plus
interest expense plus provision for income taxes plus depreciation
and amortization. We reconciled EBITDA to net income on a
consolidated basis as we do not allocate consolidated interest
expense or consolidated provision for income taxes to our
segments.
- Adjusted EBITDA is calculated as EBITDA
plus restructuring expenses plus or minus the loss or gain on sale
of businesses.
- Free cash flow is calculated as cash
flow from operating activities less capital expenditures.
Table 1: Reconciliations of Net Sales
to Net Organic Sales
For the Three Months Ended For the Nine
Months Ended September 30, 2016 September 30,
2016 FMT HST FSDP
IDEX FMT HST FSDP
IDEX Change in net sales (2%) (1%) 30%
5% (1%) 1% 18% 4%
- Net impact from
acquisitions/divestitures (1%) 2% 38% 8% 1% 2% 24% 7%
-
Impact from FX (1%) (2%) (2%) (1%) (1%) (1%) (1%) (1%)
Organic net sales 0% (1%) (6%) (2%) (1%) 0% (5%) (2%)
Table 2: Reconciliations of
Reported-to-Adjusted Operating Income and Margin (dollars in
thousands)
For the Three Months Ended September 30,
2016 2015 FMT HST
FSDP Corporate IDEX FMT
HST FSDP Corporate
IDEX Reported operating income (loss) $
55,600 $ 37,204 $
32,189 $ (16,136 ) $
108,857 $ 46,910 $ 38,371 $ 32,536 $
3,996 $ 121,813
+Restructuring expenses - -
- - - 2,505 1,774 279 165 4,723
+Net loss
(gain) on sale of businesses -
- - 2,067
2,067 - - -
(18,070 ) (18,070 )
Adjusted operating
income (loss) $ 55,600 $
37,204 $ 32,189 $
(14,069 ) $ 110,924 $ 49,415
$ 40,145 $ 32,815 $ (13,909 ) $ 108,466
Net sales (eliminations) $ 208,335
$ 183,564 $ 138,767 $
(310 ) $ 530,356 $ 212,101 $ 184,893 $
107,009 $ (212 ) $ 503,791
Operating margin 26.7
% 20.3 % 23.2 % n/m
20.5 % 22.1 % 20.8 % 30.4 % n/m 24.2 %
Adjusted
operating margin 26.7 % 20.3 %
23.2 % n/m 20.9 % 23.3 % 21.7 %
30.7 % n/m 21.5 %
For the Nine Months Ended September
30, 2016 2015 FMT HST
FSDP Corporate IDEX FMT
HST FSDP Corporate IDEX
Reported operating income (loss) $ 160,866
$ 119,028 $ 91,709 $
(47,213 ) $ 324,390 $ 154,665 $ 117,888
$ 91,180 $ (30,254 ) $ 333,479
+Restructuring expenses
- - - - - 2,505 1,774 279 165
4,723
+Net loss (gain) on sale of businesses -
- -
2,067 2,067 -
- - (18,070 ) (18,070 )
Adjusted operating income (loss) $ 160,866
$ 119,028 $ 91,709
$ (45,146 ) $ 326,457 $
157,170 $ 119,662 $ 91,459 $ (48,159 ) $
320,132
Net sales (eliminations) $
641,988 $ 556,475 $ 384,996
$ (835 ) $ 1,582,624 $ 645,642 $
552,418 $ 325,572 $ (2,762 ) $ 1,520,870
Operating margin
25.1 % 21.4 % 23.8 %
n/m 20.5 % 24.0 % 21.3 % 28.0 %
n/m
21.9 %
Adjusted operating margin 25.1 %
21.4 % 23.8 % n/m 20.6
% 24.3 % 21.7 % 28.1 %
n/m 21.0 %
Table 3: Reconciliations of
Reported-to-Adjusted Net Income and EPS (in thousands,
except EPS)
For the Three Months For the
Nine Months Ended September 30, Ended September
30, 2016 2015 2016
2015 Reported net income $ 69,873 $
79,505
$ 213,762 $ 215,044
+Restructuring
expenses - 4,723
- 4,723
+Tax impact on
restructuring expenses - (1,638 )
- (1,638 )
+Net loss (gain) on sale of businesses 2,067 (18,070
)
2,067 (18,070 )
+Tax impact on net loss (gain) on sale
of businesses (1,467 ) 4,839
(1,467 ) 4,839
Adjusted net
income $ 70,473 $ 69,359
$
214,362 $ 204,898
Reported EPS
$ 0.91 $ 1.02
$ 2.78 $ 2.75
+Restructuring expenses - 0.06
- 0.06
+Tax
impact on restructuring expenses - (0.02 )
-
(0.02 )
+Net loss (gain) on sale of businesses 0.03
(0.23 )
0.03 (0.23 )
+Tax impact on net loss (gain) on
sale of businesses (0.02 ) 0.06
(0.02 ) 0.06
Adjusted
EPS $ 0.92 $ 0.89
$
2.79 $ 2.62
Diluted weighted average
shares 76,880 77,646
76,742 78,266
Table 4: Reconciliations of EBITDA to
Net Income (in thousands)
For the Three Months Ended September 30, 2016
2015 FMT HST FSDP
Corporate IDEX FMT HST
FSDP Corporate IDEX Operating income
(loss) $ 55,600 $ 37,204 $
32,189 $ (16,136 ) $
108,857 $ 46,910 $ 38,371 $ 32,536 $ 3,996 $ 121,813
-
Other (income) expense - net (136 ) (375
) (498 ) (1,355 ) (2,364
) (82 ) (877 ) (247 ) 513 (693 )
+ Depreciation and
amortization 7,168 11,163
3,584 277
22,192 7,311 11,179
1,513 374 20,377
EBITDA 62,904 48,742 36,271
(14,504 ) 133,413 54,303 50,427 34,296 3,857
142,883
- Interest expense 11,913 10,229
-
Provision for income taxes 29,435 32,772
-
Depreciation and amortization 22,192
20,377
Net income $ 69,873
$ 79,505
Net sales (eliminations)
$ 208,335 $ 183,564 $
138,767 $ (310 ) $
530,356 $ 212,101 $ 184,893 $ 107,009 $ (212 ) $ 503,791
Operating margin 26.7 % 20.3
% 23.2 % n/m 20.5 % 22.1
% 20.8 % 30.4 % n/m 24.2 %
EBITDA margin 30.2
% 26.6 % 26.1 % n/m
25.2 % 25.6 % 27.3 % 32.0 % n/m 28.4 %
For the Nine Months Ended September 30, 2016
2015 FMT HST FSDP
Corporate IDEX FMT HST
FSDP Corporate IDEX Operating income
(loss) $ 160,866 $ 119,028 $
91,709 $ (47,213 ) $
324,390 $ 154,665 $ 117,888 $ 91,180 $ (30,254 ) $ 333,479
- Other (income) expense - net (350 )
(1,505 ) (1,342 ) (1,785
) (4,982 ) (894 ) (347 ) (1,091 ) 743 (1,589 )
+ Depreciation and amortization 22,011
33,044 8,316
953 64,324 20,321
31,874 4,574 1,205
57,974
EBITDA 183,227 153,577
101,367 (44,475 ) 393,696 175,880
150,109 96,845 (29,792 ) 393,042
- Interest expense
33,607 31,410
- Provision for income taxes
82,003 88,614
- Depreciation and amortization
64,324 57,974
Net income
$ 213,762 $ 215,044
Net sales
(eliminations) $ 641,988 $ 556,475
$ 384,996 $ (835 ) $
1,582,624 $ 645,642 $ 552,418 $ 325,572 $ (2,762 ) $
1,520,870
Operating margin 25.1 %
21.4 % 23.8 % n/m 20.5
% 24.0 % 21.3 % 28.0 % n/m 21.9 %
EBITDA margin
28.5 % 27.6 % 26.3 %
n/m 24.9 % 27.2 % 27.2 % 29.7 % n/m 25.8 %
Table 5: Reconciliations of EBITDA to
Adjusted EBITDA (in thousands)
For the Three
Months Ended September 30, 2016 2015 FMT
HST FSDP Corporate
IDEX FMT HST FSDP
Corporate IDEX EBITDA $ 62,904
$ 48,742 $ 36,271
$ (14,504 ) $ 133,413 $ 54,303 $
50,427 $ 34,296
$ 3,857 $ 142,883
+Restructuring expenses - -
- - - 2,505 1,774 279 165 4,723
+Net loss
(gain) on sale of businesses -
- - 2,067
2,067 - - -
(18,070 ) (18,070 )
Adjusted EBITDA
$ 62,904 $ 48,742
$ 36,271 $ (12,437 )
$ 135,480 $ 56,808 $ 52,201 $
34,575 $ (14,048 ) $ 129,536
Adjusted
EBITDA margin 30.2 % 26.6 %
26.1 % n/m 25.5 % 26.8 % 28.2 %
32.3 % n/m 25.7 %
For the Nine Months Ended September
30, 2016 2015 FMT HST
FSDP Corporate IDEX FMT
HST FSDP Corporate IDEX
EBITDA $ 183,227 $ 153,577
$ 101,367
$ (44,475 ) $ 393,696 $ 175,880
$ 150,109 $ 96,845 $ (29,792 ) $ 393,042
+Restructuring
expenses - - - - - 2,505
1,774 279 165 4,723
+Net loss (gain) on sale of businesses
- - -
2,067 2,067
- - - (18,070 )
(18,070 )
Adjusted EBITDA $ 183,227
$ 153,577 $ 101,367
$ (42,408 ) $ 395,763 $
178,385 $ 151,883 $ 97,124 $ (47,697 ) $
379,695
Adjusted EBITDA margin 28.5
% 27.6 % 26.3 % n/m
25.0 % 27.6 % 27.5 % 29.8 % n/m 25.0 %
Table 6: Reconciliations of Free Cash
Flow (in thousands)
For the Three Months Ended
September 30, June 30, 2016 2015
2016 Cash flow from operating activities
$ 125,480 $ 113,353 $ 88,478
- Capital
expenditures 11,590 8,785 8,402
+ Excess tax benefit
from share-based compensation * - 267
-
Free cash flow $ 113,890 $ 104,835 $
80,076
* The Company early adopted ASU 2016-09
effective in the first quarter of 2016. This ASU issued in March of
2016 simplifies the accounting for share-based payments, including
the presentation of the excess tax benefit on the statement of cash
flows.
Conference Call to be Broadcast over
the Internet
IDEX will broadcast its third quarter earnings conference call
over the Internet on Tuesday, October 18, 2016 at 9:30 a.m. CT.
Chairman and Chief Executive Officer Andy Silvernail and Vice
President, Chief Financial Officer and Chief Accounting Officer
Mike Yates will discuss the Company’s recent financial performance
and respond to questions from the financial analyst community. IDEX
invites interested investors to listen to the call and view the
accompanying slide presentation, which will be carried live on its
website at www.idexcorp.com. Those who wish to participate should
log on several minutes before the discussion begins. After clicking
on the presentation icon, investors should follow the instructions
to ensure their systems are set up to hear the event and view the
presentation slides, or download the correct applications at no
charge. Investors will also be able to hear a replay of the call by
dialing 877.660.6853 (or 201.612.7415 for international
participants) using the ID #13620008.
Forward-Looking
Statements
This news release contains “forward-looking” statements within
the meaning of the Private Securities Litigation Reform Act of
1995, as amended. These statements may relate to, among other
things, capital expenditures, acquisitions, cost reductions, cash
flow, revenues, earnings, market conditions, global economies and
operating improvements, and are indicated by words or phrases such
as “anticipate,” “estimate,” “plans,” “expects,” “projects,”
“forecasts,” “should,” “could,” “will,” “management believes,” “the
Company believes,” “the Company intends,” and similar words or
phrases. These statements are subject to inherent uncertainties and
risks that could cause actual results to differ materially from
those anticipated at the date of this news release. The risks and
uncertainties include, but are not limited to, the following:
economic and political consequences resulting from terrorist
attacks and wars; levels of industrial activity and economic
conditions in the U.S. and other countries around the world;
pricing pressures and other competitive factors, and levels of
capital spending in certain industries – all of which could have a
material impact on order rates and IDEX’s results, particularly in
light of the low levels of order backlogs it typically maintains;
its ability to make acquisitions and to integrate and operate
acquired businesses on a profitable basis; the relationship of the
U.S. dollar to other currencies and its impact on pricing and cost
competitiveness; political and economic conditions in foreign
countries in which the company operates; interest rates; capacity
utilization and the effect this has on costs; labor markets; market
conditions and material costs; and developments with respect to
contingencies, such as litigation and environmental matters.
Additional factors that could cause actual results to differ
materially from those reflected in the forward-looking statements
include, but are not limited to, the risks discussed in the “Risk
Factors” section included in the Company’s most recent annual
report on Form 10-K filed with the SEC and the other risks
discussed in the Company’s filings with the SEC. The
forward-looking statements included here are only made as of the
date of this news release, and management undertakes no obligation
to publicly update them to reflect subsequent events or
circumstances, except as may be required by law. Investors are
cautioned not to rely unduly on forward-looking statements when
evaluating the information presented here.
About IDEX
IDEX Corporation is an applied solutions company specializing in
fluid and metering technologies, health and science technologies,
and fire, safety and other diversified products built to its
customers’ exacting specifications. Its products are sold in niche
markets to a wide range of industries throughout the world. IDEX
shares are traded on the New York Stock Exchange and Chicago Stock
Exchange under the symbol “IEX”.
For further information on IDEX Corporation
and its business units, visit the company’s website at
www.idexcorp.com.
(Financial reports follow)
IDEX CORPORATION Condensed Consolidated
Statements of Operations (in thousands except per share
amounts) (unaudited)
Three Months Ended Nine Months Ended September
30, September 30, 2016
2015 2016 2015
Net sales $ 530,356 $ 503,791
$
1,582,624 $ 1,520,870
Cost of sales
299,467 280,531
884,342 839,954
Gross
profit 230,889 223,260
698,282 680,916
Selling, general and administrative expenses 119,965
114,794
371,825 360,784
Restructuring expenses
- 4,723
- 4,723
Net loss (gain) on sale of
businesses 2,067
(18,070 )
2,067
(18,070 )
Operating income 108,857 121,813
324,390 333,479
Other (income) expense - net
(2,364 ) (693 )
(4,982 ) (1,589 )
Interest expense 11,913
10,229
33,607
31,410
Income before income taxes
99,308 112,277
295,765 303,658
Provision for
income taxes 29,435
32,772
82,003
88,614
Net income $
69,873 $ 79,505
$
213,762 $ 215,044
Earnings per Common Share (a): Basic
earnings per common share $ 0.92 $ 1.03
$
2.81 $ 2.77
Diluted earnings per common share
$ 0.91 $ 1.02
$ 2.78 $ 2.75
Share Data: Basic weighted average common
shares outstanding 75,819 76,831
75,753 77,431
Diluted weighted average common shares outstanding
76,880 77,646
76,742 78,266
Condensed Consolidated Balance Sheets (in thousands)
(unaudited)
September 30, December 31,
2016
2015 Assets Current assets Cash and
cash equivalents $ 239,397 $ 328,018
Receivables - net 287,329 260,000
Inventories
276,013 239,124
Other current assets
54,614
35,542
Total current assets 857,353 862,684
Property, plant and equipment - net 261,092 240,945
Goodwill and intangible assets 2,125,322 1,684,366
Other noncurrent assets
18,697 17,448
Total
assets $
3,262,464 $ 2,805,443
Liabilities
and shareholders' equity Current liabilities Trade
accounts payable $ 117,430 $ 128,911
Accrued
expenses 160,816 153,672
Short-term borrowings
1,171 1,087
Dividends payable
25,940
25,927
Total current liabilities 305,357 309,597
Long-term borrowings 1,099,601 839,707
Other
noncurrent liabilities
302,763 212,848
Total
liabilities 1,707,721 1,362,152
Shareholders'
equity
1,554,743 1,443,291
Total
liabilities and shareholders' equity
$ 3,262,464 $ 2,805,443
IDEX CORPORATION Condensed Consolidated
Statements of Cash Flow (in thousands)
(unaudited) Nine Months Ended
September 30, 2016
2015 Cash flows from operating activities
Net income $ 213,762 $ 215,044
Adjustments
to reconcile net income to net cash provided by operating
activities: Net loss (gain) on sale of businesses
2,067 (18,070 )
Depreciation and amortization
28,360 26,634
Amortization of intangible assets
35,964 31,340
Amortization of debt issuance costs
1,150 1,233
Share-based compensation expense
15,325 14,735
Deferred income taxes 4,880
1,473
Excess tax benefit from share-based compensation
- (4,350 )
Non-cash interest expense associated with
forward starting swaps 5,144 5,287
Changes in (net of
the effect from acquisitions and divestitures):
Receivables (2,178 ) (1,417 )
Inventories 22,250 (6,474 )
Other current
assets (18,276 ) (2,742 )
Trade accounts
payable (16,696 ) (4,002 )
Accrued
expenses (2,982 ) 2,067
Other — net
(4,446 )
1,023
Net cash flows provided by operating activities
284,324 261,781
Cash flows from investing activities
Additions of property, plant and equipment (28,642
) (32,611 )
Acquisition of businesses, net of cash
acquired (510,001 ) (193,163 )
Proceeds from
sale of businesses, net of cash sold 32,529 27,677
Other — net (73 )
647
Net cash flows used in investing
activities (506,187 ) (197,450 )
Cash flows
from financing activities Borrowings under revolving
facilities 460,524 383,621
Proceeds from 3.20% Senior
Notes 100,000 -
Proceeds from 3.37% Senior Notes
100,000 -
Payments under revolving facilities
(402,172 ) (295,934 )
Payment of 2.58% Senior Euro
Notes - (88,420 )
Debt issuance costs (246
) (1,698 )
Dividends paid (77,367 )
(71,673 )
Proceeds from stock option exercises 23,154
15,167
Excess tax benefit from share-based compensation
- 4,350
Purchase of common stock (57,272
) (177,772 )
Unvested shares surrendered for tax
withholding (4,899 )
(3,217 )
Net cash flows provided by (used
in) financing activities 141,722 (235,576 )
Effect of
exchange rate changes on cash and cash equivalents
(8,480 )
(31,410 )
Net decrease in cash (88,621 )
(202,655 )
Cash and cash equivalents at beginning of year
328,018
509,137
Cash and cash equivalents at end of
period $ 239,397
$ 306,482
IDEX CORPORATION Company and Segment
Financial Information - Reported (dollars in thousands)
(unaudited) Three Months Ended Nine
months Ended
September 30, (b)
September 30, (b) 2016
2015 2016
2015 Fluid & Metering
Technologies Net sales $ 208,335 $ 212,101
$ 641,988 $ 645,642
Operating income
(c) 55,600 46,910
160,866 154,665
Operating
margin 26.7 % 22.1 %
25.1 % 24.0 %
EBITDA $ 62,904 $ 54,303
$
183,227 $ 175,880
EBITDA margin 30.2 %
25.6 %
28.5 % 27.2 %
Depreciation and
amortization $ 7,168 $ 7,311
$
22,011 $ 20,321
Capital expenditures 5,091
4,325
12,704 17,849
Health & Science
Technologies Net sales $ 183,564 $ 184,893
$ 556,475 $ 552,418
Operating income
(c) 37,204 38,371
119,028 117,888
Operating
margin 20.3 % 20.8 %
21.4 % 21.3 %
EBITDA $ 48,742 $ 50,427
$
153,577 $ 150,109
EBITDA margin 26.6 %
27.3 %
27.6 % 27.2 %
Depreciation and
amortization $ 11,163 $ 11,179
$
33,044 $ 31,874
Capital expenditures 4,450
3,193
11,455 8,755
Fire & Safety/Diversified
Products Net sales $ 138,767 $ 107,009
$ 384,996 $ 325,572
Operating income
(c) 32,189 32,536
91,709 91,180
Operating
margin 23.2 % 30.4 %
23.8 % 28.0 %
EBITDA $ 36,271 $ 34,296
$
101,367 $ 96,845
EBITDA margin 26.1 %
32.0 %
26.3 % 29.7 %
Depreciation and
amortization $ 3,584 $ 1,513
$
8,316 $ 4,574
Capital expenditures 2,034 1,016
4,305 4,128
Corporate Office and Eliminations
Intersegment sales eliminations $ (310
) $ (212 )
$ (835 ) $ (2,762 )
Operating income (loss) (c) (16,136 )
3,996
(47,213 ) (30,254 )
EBITDA
(14,504 ) 3,857
(44,475 ) (29,792 )
Depreciation and amortization 277 374
953
1,205
Capital expenditures 15 251
178 1,879
Company Net sales $ 530,356 $
503,791
$ 1,582,624 $ 1,520,870
Operating
income 108,857 121,813
324,390 333,479
Operating margin 20.5 % 24.2 %
20.5
% 21.9 %
EBITDA $ 133,413 $ 142,883
$ 393,696 $ 393,042
EBITDA margin 25.2
% 28.4 %
24.9 % 25.8 %
Depreciation and
amortization (d) $ 22,192 $ 20,377
$ 64,324 $ 57,974
Capital expenditures
11,590 8,785
28,642 32,611
(a) Calculated by applying
the two-class method of allocating earnings to common stock and
participating securities as required by ASC 260, Earnings Per
Share. (b) Three and nine month data includes
acquisition of Alfa Valvole (June 2015) in the Fluid & Metering
Technologies segment, Novotema (June 2015), CiDRA Precision
Services (July 2015) and SFC Koenig (September 2016) in the Health
& Science Technologies segment and Akron Brass (March 2016) and
AWG Fittings (July 2016) in the Fire & Safety/Diversified
segment from the date of acquisition. Three and nine month data
also includes the results of Hydra-Stop (July 2016) in the Fluid
& Metering Technologies segment and Melles Griot KK (September
2016) and Ismatec (July 2015) in the Health & Science
Technologies segment through the date of disposition.
(c) Segment operating income excludes unallocated
corporate operating expenses which are included in Corporate Office
and Eliminations. (d) Depreciation and
amortization excludes amortization of debt issuance costs.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161017006522/en/
IDEX CorporationInvestor Contact:Mike YatesVice
President, Chief Financial Officer & Chief Accounting
Officer(847) 498-7070
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