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): October 16, 2003 DOVER CORPORATION (Exact name of registrant as specified in its charter) STATE OF DELAWARE 1-4018 53-0257888 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 280 Park Avenue, New York, NY 10017 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 922-1640
Item 12. Results of Operation and Financial Condition. On October 16, 2003, Dover Corporation issued a press release announcing its third quarter 2003 operating results. A copy of the press release is attached as Exhibit 99.1. The information in this Form 8-K and the attached Exhibit shall not be deemed filed for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
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. DOVER CORPORATION (Registrant) Date: October 17, 2003 By: /s/Joseph W. Schmidt ----------------------------------- Joseph W. Schmidt, Vice President, General Counsel & Secretary
EXHIBIT INDEX EXHIBIT NO. DESCRIPTION - ----------- ----------- 99.1 Press Release dated October 16, 2003, announcing the Company's consolidated financial results for the quarter ended September 30, 2003.
Exhibit 99.1 [DOVER CORPORATION LOGO] FOR IMMEDIATE RELEASE CONTACT: READ IT ON THE WEB Robert G. Kuhbach http://www.dovercorporation.com Vice President Finance & ------------------------------- Chief Financial Officer (212) 922-1640 October 16, 2003 DOVER REPORTS THIRD QUARTER 2003 RESULTS New York, New York (October 16, 2003). Dover Corporation (NYSE: DOV) earned $75.3 million or $.37 diluted earnings per share (DEPS) from continuing operations in the third quarter ended September 30, 2003, compared to $58.5 million or $.29 DEPS from continuing operations in the comparable period last year, an increase of 28%. Net earnings for the third quarter of 2003 were $84.4 million or $.41 DEPS, which included $9.1 million of earnings from discontinued operations or $.04 DEPS compared to net earnings of $56.4 million or $.28 DEPS for the third quarter of 2002 which included $2.0 million or $.01 DEPS in losses from discontinued operations. Sales in the third quarter of 2003 were $1,153.7 million, an increase of 9% as compared to $1,062.5 million for the third quarter last year. Dover Corporation earned $207.1 million or $1.02 DEPS from continuing operations for the nine months ended September 30, 2003, compared to $172.2 million or $.85 DEPS from continuing operations in the comparable period last year, an increase of 20%. Net earnings before cumulative effect of accounting changes for the nine months of 2003 were $216.6 million or $1.07 DEPS, including $9.5 million of earnings or $.05 DEPS from discontinued operations compared to $156.8 million or $.77 DEPS, for the same period of 2002 which included $15.5 million or $.08 DEPS in losses from discontinued operations. Sales in the first nine months of 2003 were $3,305.8 million, an increase of 5% as compared to $3,138.9 million for the comparable period last year. Discontinued operations earnings for the quarter and year-to-date of $9.1 million and $9.5 million, respectively, were primarily from the favorable resolution of certain outstanding tax matters and tax benefits related to losses on sales of businesses. These items were partially offset by charges related to contingent liabilities from the entities sold. For the nine months ended September 30, 2002, the impact of the adoption of the Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets", resulted in a net loss of $136.3 million or $.67 DEPS. The adoption resulted in a goodwill impairment charge of $345.1 million ($293.0 million net of tax or $1.44 DEPS). The adoption discontinued the amortization of goodwill effective January 1, 2002. Commenting on the results and the current outlook, Thomas L. Reece, Chairman and CEO, said, "Dover's third quarter results continue to reflect the positive progress seen in the first and second quarters despite challenging economic conditions which still impact most of our companies. Technologies had its most profitable quarter since the first quarter of 2001. This is (more)
2 a direct result of continuing operating improvements by our CBAT and SEC companies. Segment operating margins increased to 9% from 7% last quarter and we are encouraged by Technologies' improved profitability and operating leverage. The positive bookings trend seems to indicate that the electronic markets we serve are stabilizing and in some cases showing modest growth. Resources was once again our most profitable segment for the quarter and we expect their newest acquisition, Warn Industries which closed on October 1, to make a significant contribution in terms of future sales and profitability. Our Diversified segment had lower earnings on essentially flat sales, despite a strong performance at Hill Phoenix. Industries continues to face challenges in many markets, although results were modestly better than either the first or second quarter, and reflected meaningful strategic realignment expenses. Overall, we are pleased with our third quarter performance. While results over the past three quarters show encouraging signs for most of our markets, the outlook for the global manufacturing economy still remains unclear. Our businesses continue to make the right investments and right size their operations to ensure that Dover is well positioned for a manufacturing upturn." SEGMENT RESULTS - --------------- DIVERSIFIED Three Months Ended September 30, Nine Months Ended September 30, (in thousands, unaudited) 2003 2002 % Change 2003 2002 % Change - ---------------------------------------------------------------------------- ----------------------------------------- Net sales $ 306,559 $ 299,402 2.4% $ 914,856 $ 896,865 2.0% Earnings 29,911 36,348 -17.7% 99,379 105,791 -6.1% Operating margins 9.8% 12.1% 10.9% 11.8% Diversified's third quarter results reflect a strong performance from Hill Phoenix which was offset by flat to down results at other businesses. Hill Phoenix achieved record earnings and significantly improved margins for a second consecutive quarter, as increased volume and production efficiency improvements drove the performance. Sargent reported slightly improved earnings, with increases from their defense business and a strategic add-on acquisition, offset by continued weakness in the commercial aerospace market. PMI earnings were flat, as they continue to deal with production issues and softness in some of their market segments. SWEP and Tranter PHE both reported slightly improved sales and earnings over last year, mainly due to large projects and improving markets. Although earnings and margins were down compared to the prior year period, Belvac's strong backlog and consistent bookings keep them on track for a solid sales and earnings year. Crenlo reported lower earnings, as sales volume was the lowest of the year, although bookings for the quarter were up 25% over last year. Waukesha reported lower earnings due to manufacturing facility closure costs and continued market softness. Mark Andy, SWF and Van Dam continue to struggle with adverse conditions in the printing/packaging markets served. Graphics Microsystems earnings were flat compared to last year on slightly improved sales. However, bookings and backlog indicate a positive trend as they have focused on market share growth with a number of large customers. Bookings in the quarter were $308.4 million, an increase of 8% from the prior year, and the quarter book-to-bill ratio was 1.01. Backlog at the end of the quarter was $377.3 million, 5% higher than at the beginning of the year. (more)
3 INDUSTRIES Three Months Ended September 30, Nine Months Ended September 30, (in thousands, unaudited) 2003 2002 % Change 2003 2002 % Change - -------------------------------------------------------------------------- ------------------------------------ Net sales $ 271,128 $ 270,962 0.1% $ 782,710 $ 801,140 -2.3% Earnings 31,508 31,705 -0.6% 87,763 108,053 -18.8% Operating margins 11.6% 11.7% 11.2% 13.5% Industries' third quarter results approximated prior year, but compared positively to last quarter as sales and earnings grew 3% and 8%, respectively. Strong earnings and margin gains at Tipper Tie and positive comparisons at Heil Environmental, PDQ, Chief Automotive and Dovatech compared to the same period last year were the key contributors. Sales improved at Rotary driven by strong overseas performance, although start-up costs negatively impacted earnings. Tipper Tie benefited from strong overseas results as Alpina (a Swiss acquisition purchased in 2000) grew at double-digit rates. Triton's sales were flat compared to the prior year but up over 10% compared to last quarter led by a strong new product focus. Products introduced since January of 2002 now account for over 70% of Triton's unit sales. PDQ's earnings improvement was primarily the result of new product introductions. Heil Environmental sales exceeded 2002 levels for the first time this year driven by share gains domestically along with a strong European performance. Dovatech's results surpassed last year for the third consecutive quarter driven by strength in its Chiller businesses. Heil Trailer, Marathon and DI Foodservice continued to be impacted by weak markets, although all are strategically realigning their businesses, which should improve future performance. Although Kurz-Kasch's results declined this quarter due to the impact of new product introductions, sales and earnings continue to show double-digit increases for the year. Segment bookings in the quarter were $277.9 million, an increase of 5% from last year, and the book-to-bill ratio was 1.02 for the current quarter. Backlog increased 24% from the beginning of the current year to $151.3 million. RESOURCES Three Months Ended September 30, Nine Months Ended September 30, (in thousands, unaudited) 2003 2002 % Change 2003 2002 % Change - ------------------------------------------------------------------------ -------------------------------------- Net sales $ 248,791 $ 224,718 10.7% $ 718,796 $ 674,770 6.5% Earnings 36,954 32,919 12.3% 102,772 95,757 7.3% Operating margins 14.9% 14.6% 14.3% 14.2% The improved results at Resources were driven by a combination of factors, including higher energy prices, new product introductions, global sales and sourcing initiatives, and right sizing of businesses that continue to face sluggish markets. Compared to last year, strong earnings growth was achieved at the Energy Products Group, OPW Fueling Components, OPW Fluid Transfer Group and Wilden. These businesses are all strongly positioned on a global basis and also are benefiting from key new product introductions. Blackmer continues to be negatively impacted by the slow down in the "chemical and process" markets in North America but has taken necessary steps to right size its North American operations in response to this softness. Both De-Sta-Co Industries and De-Sta-Co Manufacturing have seen continued softness in spending by North American automotive and industrial customers. Texas Hydraulics and, to some extent, Tulsa Winch continue to be affected by the slow down in construction equipment, mobile cranes, and aerial lift markets. In response, Texas Hydraulics continues to add new customers and new products, while Tulsa Winch has capitalized on its strength in military, oil field, and marine winch applications. C. Lee Cook's results are flat with prior year but it is beginning to experience some increase in its compressor OEM business. Hydro Systems' sales and earnings are comparable to prior year in total but the business has seen a shift to and (more)
4 growth in its European operations. RPA Process Technologies achieved earnings growth over prior year primarily as a result of the completion of several large projects but the business continues to face sluggish capital spending in the paper, process, and minerals markets. Bookings in the quarter of $251.6 million were up 17% from the prior year and the book-to-bill ratio for the quarter was 1.01. Ending backlog was $90.6 million, a 17% increase from the end of last year. Resources' results for all periods have been adjusted to include Texas Hydraulics, which was transferred from Industries at the beginning of the year. TECHNOLOGIES Three Months Ended September 30, Nine Months Ended September 30, (in thousands, unaudited) 2003 2002 % Change 2003 2002 % Change - ------------------------------------------------------------------------ -------------------------------------- Net sales $ 329,313 $ 269,357 22.3% $ 895,562 $ 770,884 16.2% Earnings 29,794 1,252 - 61,022 (2,651) - Operating margins 9.0% 0.5% 6.8% -0.3% The turnaround evidenced in the first half of 2003 continued into the third quarter. Bookings, sales and earnings were up 6%, 8% and 44%, respectively, on a sequential quarterly basis, and bookings and sales were up 29% and 22%, respectively, over the third quarter of 2002, while earnings increased $28.5 million. All of the Technologies companies have reported profits on a year-to-date basis, with the exception of one Specialized Electronic Components (SEC) company. The Circuit Board Assembly and Test (CBAT) businesses recorded earnings of $19.5 million as compared to a loss of $3.3 million for the third quarter of 2002. Third quarter sales were $204.4 million, an increase of $41.8 million or 26% from last year's comparable quarter. Bookings at $206.1 million were up 35% over the prior year. Bookings increased 14% from last quarter, following a 13% increase in the second quarter of 2003. The book-to-bill ratio for the quarter was 1.01 and backlog was $90.6 million. The year-to-date CBAT growth, experienced at all companies, was attributable in large part to increased demand in the backend semiconductor products at Alphasem and ECT, and continued growth from investments in Asia, particularly in China. In addition, the CBAT companies reported sales in the current quarter to large North American based EMS companies for the first time in a while. The Specialized Electronic Components (SEC) businesses had sales in the quarter of $52.0 million, as compared to $45.8 million in last year's third quarter, an increase of 14% and were flat compared to last quarter. SEC reported earnings of $0.8 million as compared to a loss of $3.4 million in 2002. Bookings in the third quarter of $55.0 million were 15% greater than the same period last year. Sequentially earnings for SEC decreased $1.1 million on flat sales while bookings increased 6.0%. Vectron, the largest company in SEC, recorded quarterly sales, earnings and margin increases compared to both the prior quarter and last year. Through more efficient operations and improved customer focus (quality, flexibility and product development), Vectron reported its best margins since early 2001. Offsetting that performance, K&L Microwave had a difficult quarter as it winds up its restructuring in order to focus on military and selected commercial wireless markets. The SEC book-to-bill ratio was 1.06 and backlog was $49.2 million. The SEC companies continue to expand into the military, space, medical and industrial markets, and have noted some signs of improved activity at certain of the large telecom equipment companies. In the quarter, Imaje had sales of $72.9 million, an increase of 20% over the same period in 2002. Earnings increased from $14.5 million to $15.8 million or 9%. Earnings for the third quarter equaled the level of earnings for the second quarter on slightly reduced sales. This (more)
5 reflects improved execution of Imaje's logistics and distribution networks coupled with continued focus on new product development. Sales for 2003 as compared to 2002 were positively impacted by a 15% strengthening of the Euro against the dollar. However, margins continue to be pressured as the majority of Imaje's product costs are incurred in Euros. Consequently, Imaje is in process of expanding its product delivery platform in both China and North America. OTHER INFORMATION: Subsequent to the third quarter, on October 1, 2003, Dover Resources acquired Warn Industries Inc. for approximately $325 million in cash. Warn, located in Portland, Oregon, is the industry leader in the design, manufacture and marketing of high-performance winches. With this acquisition, Resources becomes the clear leader in mobile winches, expanding its product offering into the All Terrain Vehicle and light industrial material handling markets. Additionally, it establishes a solid position in the rapidly growing Four Wheel and All Wheel Drive vehicle segment with a series of technologically superior drive train components, which have been adopted by major U.S. and non-U.S. automotive manufacturers. The acquisition is expected to be accretive to earnings during 2004. Warn, with annual sales in excess of $150 million, will be a stand alone operating company within the Resources segment. The acquisition was financed with existing cash on hand and commercial paper borrowings. The effective tax rate for continuing operations for the third quarter of 2003 was 24.6% compared to last year's third quarter rate of 27.7%. For the first nine months of 2003, the effective tax rate for continuing operations was 24.5%, compared to 27.7% for the same period last year. The low effective tax rate is largely due to the continuing benefit from tax credit programs such as those for R&D and foreign taxes combined with the benefit from U.S. export programs, a lower foreign effective tax rate and the recognition of certain capital loss benefits. Subsequent to the third quarter, the company received tax refunds of approximately $144.0 million related to the filing of the 2002 federal tax return and anticipates receiving additional refunds during the fourth quarter of $7.4 million. The proceeds from the tax refund will be used to pay down commercial paper borrowings and for other general corporate purposes. Net debt levels decreased $84.6 million during the first nine months of 2003 and the net debt to total capitalization ratio decreased by 3.5 percentage points during the period. The following table provides a reconciliation of net debt to total capitalization with the GAAP information found in the attached financial statements. Unaudited September 30, December 31, Net Debt to Total Capitalization Ratio (in thousands) 2003 2002 - ----------------------------------------------------------------------------------- Short-term debt and commercial paper $ 73,683 $ 23,761 Long-term debt 1,006,033 1,030,299 Less: Cash, equivalents and marketable securities 405,250 294,959 -------------------------- Net debt 674,466 759,101 Add: Stockholders' equity 2,599,955 2,394,623 ========================== Total capitalization $ 3,274,421 $ 3,153,724 Net debt to total capitalization 20.6% (24.1%) - ----------------------------------------------------------------------------------- Free cash flow for the nine months ended September 30, 2003 increased significantly as cash generated from operations improved $41.9 million compared to last year. The 2003 improvement in free cash flow reflects improved net earnings and lower tax payments, offset slightly by an increase in working capital. A discretionary contribution of $27.0 million was also made to the defined benefit pension plan in the third quarter of 2003. Year-to-date discretionary contributions are approximately $45.8 million. Dover did not repurchase shares of its common stock on the open market during the quarter. (more)
6 The following table is a reconciliation of free cash flow with cash flows from operating activities. Nine Months Ended September 30, Free Cash Flow (in thousands, unaudited) 2003 2002 - ------------------------------------------------------------------------------ Cash flow provided by operating activities $ 230,368 $ 183,975 Less: Capital expenditures (70,576) (69,073) Dividends to stockholders (85,079) (82,112) --------- --------- Free cash flow $ 74,713 $ 32,790 - ------------------------------------------------------------------------------ Corporate expenses have increased $9.5 million compared to the prior year-to-date amounts due to higher insurance and compensation costs, and consulting fees incurred for Sarbanes- Oxley compliance, various tax planning projects and other corporate initiatives. During the third quarter, Dover acquired the assets of Temex, S.A.W., a strategic add-on acquisition of Vectron in the Technologies segment. Also during the quarter, Dover divested DT Magnetics from the Technologies market segment, which was previously designated as a discontinued operation. Neither transaction will have a material impact on Dover's 2003 financial results. In an effort to provide investors with additional information regarding the company's results as determined by generally accepted accounting principles (GAAP), the company also discloses non-GAAP information which management believes provides useful information to investors. Free cash flow, net debt and capitalization are not financial measures under GAAP, should not be considered as a substitute for cash flows from operating activities, debt and equity, as determined in accordance with GAAP and may not be comparable to similarly titled measures reported by other companies. Management believes the net debt to capitalization ratio and free cash flow are important measures of liquidity and operating performance because it provides both management and investors a measurement of cash generated from operations that is available to fund acquisitions and repay debt. The Dover website will host a Webcast of the third quarter conference call at 9:00 AM Eastern Time on Friday, October 17, 2003. The conference call will also be made available for replay on the website. Additional information on Dover's third quarter results and its operating companies can be found on the company website, (http://www.dovercorporation.com). ------------------------------ Dover Corporation makes information available to the public, orally and in writing, which may use words like "expects" and "believes", which are "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. This press release contains forward-looking statements regarding future events and the performance of Dover Corporation that involve risks and uncertainties that could cause actual results to differ materially including, but not limited to, failure to achieve expected synergies, failure to successfully integrate acquisitions, the impact of continued events in the Middle East on the worldwide economy, economic conditions, customer demand, increased competition in the relevant market, and others. Dover Corporation 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, which contain additional important factors that could cause its actual results to differ from its current expectations and from the forward-looking statements contained in this press release. ####TABLES TO FOLLOW (more)
7 DOVER CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) (IN THOUSANDS, EXCEPT PER SHARE FIGURES) Three Months Ended September 30, Nine Months Ended September 30, 2003 2002 2003 2002 ----------- ----------- ----------- ----------- Net sales $ 1,153,742 $ 1,062,451 $ 3,305,753 $ 3,138,861 Cost of sales 765,174 711,894 2,174,423 2,109,332 ----------- ----------- ----------- ----------- Gross profit 388,568 350,557 1,131,330 1,029,529 Selling and administrative expenses 270,644 251,230 804,258 742,323 ----------- ----------- ----------- ----------- Operating profit 117,924 99,327 327,072 287,206 ----------- ----------- ----------- ----------- Interest expense, net 15,439 14,626 47,590 49,134 All other (income) expense, net 2,605 3,781 5,227 (117) ----------- ----------- ----------- ----------- Total 18,044 18,407 52,817 49,017 ----------- ----------- ----------- ----------- Earnings from continuing operations, before taxes on income 99,880 80,920 274,255 238,189 Federal and other taxes on income 24,590 22,429 67,125 65,970 ----------- ----------- ----------- ----------- Net earnings from continuing operations 75,290 58,491 207,130 172,219 ----------- ----------- ----------- ----------- Net earnings (losses) from discontinued operations 9,065 (2,049) 9,478 (15,460) ----------- ----------- ----------- ----------- Net earnings before cumulative effect of change in accounting principle 84,355 56,442 216,608 156,759 ----------- ----------- ----------- ----------- Cumulative effect of change in accounting principle, net of tax -- -- -- (293,049) ----------- ----------- ----------- ----------- Net earnings (losses) $ 84,355 $ 56,442 $ 216,608 $ (136,290) =========== =========== =========== =========== Net earnings (losses) per common share: Basic - - Continuing operations $ 0.37 $ 0.29 $ 1.02 $ 0.85 - - Discontinued operations 0.05 (0.01) 0.05 (0.08) ----------- ----------- ----------- ----------- - - Total net earnings before cumulative effect of change in accounting principle 0.42 0.28 1.07 0.77 - - Cumulative effect of change in accounting principle -- -- -- (1.44) ----------- ----------- ----------- ----------- - - Net earnings (losses) $ 0.42 $ 0.28 $ 1.07 $ (0.67) =========== =========== =========== =========== Diluted - - Continuing operations $ 0.37 $ 0.29 $ 1.02 $ 0.85 - - Discontinued operations 0.04 (0.01) 0.05 (0.08) ----------- ----------- ----------- ----------- - - Total net earnings before cumulative effect of change in accounting principle 0.41 0.28 1.07 0.77 - - Cumulative effect of change in accounting principle -- -- -- (1.44) ----------- ----------- ----------- ----------- - - Net earnings (losses) $ 0.41 $ 0.28 $ 1.07 $ (0.67) =========== =========== =========== =========== Weighted average number of common shares outstanding during the period: Basic 202,568 202,633 202,509 202,647 Diluted 204,017 203,230 203,366 203,541
8 DOVER CORPORATION MARKET SEGMENT RESULTS (UNAUDITED) (IN THOUSANDS) Three Months Ended September 30, Nine Months Ended September 30, -------------------------------- ------------------------------- SALES 2003 2002 2003 2002 ----- ----------- ----------- ----------- ----------- Diversified $ 306,559 $ 299,402 $ 914,856 $ 896,865 Industries 271,128 270,962 782,710 801,140 Resources 248,791 224,718 718,796 674,770 Technologies 329,313 269,357 895,562 770,884 Intramarket eliminations (2,049) (1,988) (6,171) (4,798) ----------- ----------- ----------- ----------- Net sales $ 1,153,742 $ 1,062,451 $ 3,305,753 $ 3,138,861 =========== =========== =========== =========== EARNINGS -------- Diversified $ 29,911 $ 36,348 99,379 105,791 Industries 31,508 31,705 87,763 108,053 Resources 36,954 32,919 102,772 95,757 Technologies 29,794 1,252 61,022 (2,651) ----------- ----------- ----------- ----------- Subtotal continuing operations 128,167 102,224 350,936 306,950 Corporate expense (12,848) (6,678) (29,091) (19,627) Net interest expense (15,439) (14,626) (47,590) (49,134) ----------- ----------- ----------- ----------- Earnings from continuing operations, before taxes on income 99,880 80,920 274,255 238,189 Federal and other taxes on income 24,590 22,429 67,125 65,970 ----------- ----------- ----------- ----------- Net earnings from continuing operations $ 75,290 $ 58,491 $ 207,130 $ 172,219 =========== =========== =========== ===========
9 DOVER CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET AND STATEMENT OF CASH FLOWS (UNAUDITED) (IN THOUSANDS) September 30, December 31, BALANCE SHEET 2003 2002 ----------- ----------- Assets: Cash and cash equivalents $ 404,379 $ 294,448 Receivables, net of allowances for doubtful accounts 778,096 669,885 Inventories 630,199 595,071 Prepaid expenses & other current assets 269,076 98,597 Property, plant & equipment, net 700,107 704,922 Goodwill 1,684,366 1,654,883 Intangibles, net 197,591 202,836 Other assets 263,976 216,743 ----------- ----------- $ 4,927,790 $ 4,437,385 =========== =========== LIABILITIES & STOCKHOLDERS' EQUITY: Short term debt $ 73,683 $ 23,761 Payables and accrued expenses 729,559 626,029 Taxes payable 353,958 211,448 Other deferrals 164,602 151,225 Long-term debt 1,006,033 1,030,299 Stockholders' equity 2,599,955 2,394,623 ----------- ----------- $ 4,927,790 $ 4,437,385 =========== =========== Nine Months Ended September 30, ------------------------------- CASH FLOWS 2003 2002 ----------- ----------- OPERATING ACTIVITIES: Net earnings (loss) $ 216,608 $ (136,290) Cumulative effective of change in accounting principle -- 293,049 (Earnings) loss from discontinued operations, net of tax (9,478) 15,460 Depreciation and amortization 113,528 119,035 Net change (increase) decrease in assets and liabilities (54,946) (54,958) Increase (decrease) in deferred and current taxes on income (24,820) (48,256) Other, net (10,524) (4,065) ----------- ----------- Net cash from (used in) operating activities 230,368 183,975 ----------- ----------- INVESTING ACTIVITIES: Capital expenditures (70,576) (69,073) Acquisitions, net of cash (31,240) (50,827) ----------- ----------- Net cash from (used in) investing activities (101,816) (119,900) ----------- ----------- Financing activities: Increase (decrease) in debt 25,657 (2,530) Proceeds from interest rate swap terminations -- 8,434 Cash dividends to stockholders (85,079) (82,112) Purchase of treasury stock (1,792) (15,139) Proceeds from exercise of stock options 2,950 6,215 ----------- ----------- Net cash from (used in) financing activities (58,264) (85,132) ----------- ----------- Effect of exchange rate changes on cash 24,957 16,791 Net cash from (used in) discontinued operations 14,686 2,904 Net increase (decrease) in cash & equivalents 109,931 (1,362) Cash & cash equivalents at beginning of period 294,448 175,331 ----------- ----------- Cash & cash equivalents at end of period $ 404,379 $ 173,969 =========== ===========
10 DOVER CORPORATION QUARTERLY MARKET SEGMENT INFORMATION (1) DOVER DIVERSIFIED ----------------- 2001 2002 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. ---------------------------------------------------------------------------------------------- Sales $253,820 $277,898 $296,170 $290,394 $288,437 $309,026 $299,401 $295,193 Segment Earnings 20,509 35,036 22,279 18,110 30,047 39,395 36,348 27,306 Bookings 260,862 307,522 306,448 264,216 295,618 295,097 286,645 286,810 Backlog 333,050 387,081 402,552 382,728 389,383 378,735 367,180 360,081 Book to Bill 1.03 1.11 1.03 0.91 1.02 0.95 0.96 0.97 Margin 8.1% 12.6% 7.5% 6.2% 10.4% 12.7% 12.1% 9.3% DOVER DIVERSIFIED ----------------- 2003 1 Qtr. 2 Qtr. 3 Qtr. ------------------------------ Sales $292,033 $316,264 $306,559 Segment Earnings 31,719 37,750 29,911 Bookings 293,354 317,940 308,393 Backlog 362,452 375,304 377,283 Book to Bill 1.00 1.01 1.01 Margin 10.9% 11.9% 9.8% DOVER INDUSTRIES ---------------- 2001 2002 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. -------------------------------------------------------------------------------------------------- Sales $269,582 $279,719 $273,064 $269,339 $261,486 $268,692 $270,962 $259,774 Segment Earnings 33,609 36,634 30,679 33,130 39,197 37,151 31,705 29,895 Bookings 292,496 281,899 257,006 244,875 251,165 278,903 264,504 226,560 Backlog 174,778 193,734 178,996 156,595 147,236 161,122 155,823 122,366 Book to Bill 1.08 1.01 0.94 0.91 0.96 1.04 0.98 0.87 Margin 12.5% 13.1% 11.2% 12.3% 15.0% 13.8% 11.7% 11.5% DOVER INDUSTRIES ---------------- 2003 1 Qtr. 2 Qtr. 3 Qtr. ------------------------------- Sales $247,932 $263,650 $271,128 Segment Earnings 27,199 29,055 31,508 Bookings 267,188 260,586 277,866 Backlog 142,785 143,664 151,271 Book to Bill 1.08 0.99 1.02 Margin 11.0% 11.0% 11.6% DOVER RESOURCES --------------- 2001 2002 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. --------------------------------------------------------------------------------------------- Sales $247,719 $248,004 $238,996 $231,105 $217,186 $232,866 $224,718 $225,717 Segment Earnings 35,512 33,665 28,165 26,874 29,624 33,215 32,917 28,944 Bookings 259,125 247,049 225,128 216,442 221,794 243,251 215,612 214,359 Backlog 110,078 108,139 95,916 79,820 83,862 96,007 87,152 77,696 Book to Bill 1.05 1.00 0.94 0.94 1.02 1.04 0.96 0.95 Margin 14.3% 13.6% 11.8% 11.6% 13.6% 14.3% 14.6% 12.8% 2003 1 Qtr. 2 Qtr. 3 Qtr. -------------------------------------------- Sales $229,792 $240,213 $248,790 Segment Earnings 32,691 33,126 36,954 Bookings 239,688 238,371 251,556 Backlog 86,876 87,223 90,570 Book to Bill 1.04 0.99 1.01 Margin 14.2% 13.8% 14.9% DOVER TECHNOLOGIES ------------------ 2001 2002 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. ----------------------------------------------------------------------------------------------- Sales $407,896 $284,381 $259,078 $246,782 $228,845 $272,682 $269,356 $265,589 Segment Earnings 47,764 51 (41,262) (932) (6,933) 3,030 1,252 (27,689) Bookings 303,203 219,412 189,835 229,725 240,059 287,827 257,600 261,417 Backlog 263,882 200,166 115,414 109,199 119,074 138,213 128,365 127,752 Book to Bill 0.74 0.77 0.73 0.93 1.05 1.06 0.96 0.98 Margin 11.7% 0.0% -15.9% -0.4% -3.0% 1.1% 0.5% -10.4% 2003 1 Qtr. 2 Qtr. 3 Qtr. --------------------------------------------- Sales $260,042 $306,207 $329,313 Segment Earnings 10,498 20,731 29,794 Bookings 276,498 312,692 332,233 Backlog 146,415 157,821 158,146 Book to Bill 1.06 1.02 1.01 Margin 4.0% 6.8% 9.0% (1) Excludes discontinued operations. 2001 includes Goodwill amortization.
11 DOVER CORPORATION DOVER TECHNOLOGIES - QUARTERLY MARKET SEGMENT INFORMATION (1) CBAT ---- 2001 2002 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. ------------------------------------------------------------------------------------------------- Sales $ 226,622 $ 146,179 $ 143,052 $ 130,794 $ 124,796 $ 158,686 $ 162,585 $ 152,579 Segment Earnings 15,519 (18,902 (37,558) (11,861) (13,256) (10,175) (3,307) (28,984) Bookings 187,630 128,884 109,179 129,237 139,474 176,574 153,193 149,231 Backlog 88,066 73,654 44,844 53,483 65,216 84,101 74,588 72,166 Book to Bill 0.83 0.88 0.76 0.99 1.12 1.11 0.94 0.98 Margin 6.8% -12.9% -25.3% -9.1% -11.6% -6.4% -2.0% -19.0% 2003 1 Qtr. 2 Qtr. 3 Qtr. ---------------------------------- Sales $ 148,883 $ 179,171 $ 204,425 Segment Earnings 1,637 10,151 19,497 Bookings 161,001 181,804 206,146 Backlog 84,953 91,153 90,553 Book to Bill 1.08 1.00 1.01 Margin 1.1% 5.7% 9.5% SEC --- 2001 2002 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. ---------------------------------------------------------------------------------------- Sales $138,168 $ 87,105 $ 59,220 $ 60,264 $ 53,802 $ 56,148 $ 45,786 $ 49,946 Segment Earnings 32,066 10,048 1,773 1,706 (2,657) (1,139) (3,446) (4,828) Bookings 73,792 37,309 26,304 44,627 51,305 53,999 47,916 46,036 Backlog 166,971 115,920 61,145 45,809 43,356 42,128 45,650 42,740 Book to Bill 0.52 0.43 0.44 0.74 0.94 0.96 1.05 0.92 Margin 23.2% 11.5% 3.0% 2.8% -3.9% -2.0% -8.5% -9.7% 2003 1 Qtr. 2 Qtr. 3 Qtr. ------------------------------- Sales $ 50,315 $ 52,081 $ 51,969 Segment Earnings 3,009 1,865 772 Bookings 53,602 52,261 54,913 Backlog 46,426 46,303 49,246 Book to Bill 1.05 1.00 1.06 Margin 6.0% 3.6% 1.5% IMAJE ----- 2001 2002 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. 1 Qtr. 2 Qtr. 3 Qtr. 4 Qtr. ------------------------------------------------------------------------------------ Sales $43,664 $52,157 $57,399 $56,470 $50,294 $57,848 $60,985 $63,063 Segment Earnings 9,488 14,227 15,196 14,640 9,507 12,453 14,525 13,360 Bookings 43,298 54,219 55,977 57,247 50,010 57,998 57,199 66,918 Backlog 9,093 10,633 9,940 10,645 10,502 11,984 8,128 12,846 Book to Bill 1.00 1.05 0.99 1.02 1.00 1.01 0.95 1.07 Margin 23.7% 27.3% 24.5% 24.9% 17.9% 22.5% 23.8% 21.2% 2003 1 Qtr. 2 Qtr. 3 Qtr. ----------------------------- Sales $60,844 $74,955 $72,919 Segment Earnings 11,233 15,821 15,814 Bookings 62,147 79,038 71,039 Backlog 15,035 20,364 18,347 Book to Bill 1.02 1.05 0.97 Margin 18.5% 21.1% 21.7% (1) Excludes discontinued operations. 2001 includes Goodwill amortization.