UNITED STATES
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): December 18, 2019
_______________________________
(Exact name of registrant as specified in its charter)
______________________________________________
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | |||||||||
| (Address of Principal Executive Offices) | (Zip Code) | ||||||||||
(Registrant’s telephone number, including area code)
______________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 7.01 Regulation FD Disclosure
Effective as of October 1, 2019, Dover Corporation (the “Company”) has realigned into five business segments.
Descriptions of the five business segments are as follows:
•Engineered Products provides a wide range of products, software and services that have broad customer applications across a number of markets including: solid waste handling, vehicle service, industrial automation, defense and telecommunications, and industrial winch and hoist. The waste handling business is a supplier of products, software and services for the refuse collection industry and for on-site processing and compaction of trash and recyclable materials. The vehicle service business provides products, software and services used primarily in vehicle repair and maintenance, including light and heavy-duty vehicle lifts, wheel service equipment, vehicle diagnostics and vehicle collision repair solutions. The segment also provides to the industrial automation market a wide range of modular automation components, including manual clamps, power clamps and rotary and linear mechanical indexers, supplies radiofrequency and microwave filters and switches to aerospace & defense markets, and supplies industrial winches and hoists.
•Fueling Solutions provides components, equipment and software and service solutions enabling safe transport of fuels and other hazardous fluids along the supply chain, as well as safe and efficient operation of retail fueling and vehicle washing establishments across the globe. Among solutions supplied by the segment are fuel dispensers, payment systems, hardware and underground containment systems, vehicle wash systems, as well as asset tracking, monitoring and operational optimization software. Additionally, Fueling Solutions supplies components used for transfer of fuels and other critical liquids across the supply chain.
•Imaging & Identification consists of worldwide leading suppliers of precision marking and coding and digital textile printing equipment, as well as related consumables, software and services. The Imaging & Identification segment primarily designs and manufactures equipment and consumables used for printing variable information (such as bar coding of dates and serial numbers) on fast-moving consumer goods, capitalizing on expanding food and product safety and traceability requirements and growth in emerging markets. In addition, the businesses serving the apparel and textile printing market are benefiting from a secular shift from analog to digital printing, resulting from growth in "fast fashion" and more complex and customized fashion designs, as well as increasing environmental standards. Businesses within this segment leverage digital printing capabilities and operate business models that involve initial equipment and software sales followed by significant consumable, software and service aftermarket revenue streams.
•Pumps & Process Solutions manufactures specialty pumps, fluid handling components, plastics and polymers processing equipment, and highly-engineered components for rotating and reciprocating machines. Products are used in a wide variety of markets, including plastics and polymers processing, chemicals production, food/sanitary, biopharma, medical, transportation, petroleum refining, power generation, and general industrial applications. The specialty pumps and components are used in demanding and specialized operating environments with high performance requirements. Businesses within this segment share the following commonalities: component nature of the products, diverse and fragmented customer base, significant aftermarket demand, and similar route-to-market models.
•Refrigeration & Food Equipment is a provider of innovative and energy-efficient equipment and systems that serve the commercial refrigeration, heating and cooling, and food equipment markets. The refrigeration business produces refrigeration systems, refrigeration display cases, commercial glass refrigerator and freezer doors, and brazed plate heat exchangers used for industrial heating and cooling and residential climate control. Other businesses in this segment design and manufacture commercial food service equipment and can-making machinery.
Annual unaudited financial information reflecting the Company’s reporting business segments for full years 2018, 2017 and 2016 and quarterly unaudited financial information for 2018 and year-to-date 2019 are attached hereto as Exhibit 99.1. The information in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished to the Securities and Exchange Commission (the “SEC”) and shall not be deemed to be incorporated by reference into any of Dover’s filings with the SEC under the Securities Act of 1933, as amended.
The realignment will be reflected in the Company’s full-year 2019 financial results. Going forward, the Company will provide customary segment data, including revenue and bookings data, as well as market commentary, on the new segment basis.
The Company’s business units have been realigned as follows within the new segment structure:
Engineered Products
De-Sta-Co
Environmental Solutions Group
Microwave Products Group
OK International
Tulsa Winch Group
Vehicle Services Group
Imaging & Identification
Dover Digital Printing
Markem-lmaje
Fueling Solutions
Dover Fueling Solutions
OPW
Pumps & Process Solutions
Colder Products Company
Dover Precision Components
Maag
Pump Solutions Group
Refrigeration & Food Equipment
Belvac
Dover Food Retail
SWEP
Unified Brands
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
99.1 Annual unaudited financial information reflecting the Company’s reporting business segments for full years 2018, 2017 and 2016 and quarterly unaudited financial information for 2018 and year-to-date 2019.
104 Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: | December 18, 2019 | DOVER CORPORATION | ||||||||||||
| (Registrant) | ||||||||||||||
| By: | /s/ Ivonne M. Cabrera | |||||||||||||
| Ivonne M. Cabrera | ||||||||||||||
| Senior Vice President, General Counsel & Secretary | ||||||||||||||
Exhibit 99.1
DOVER CORPORATION
REVENUE, EARNINGS & OTHER DATA BY SEGMENT
(unaudited)(in thousands)
| Years Ended December 31, | |||||||||||||||||
| 2018 | 2017 | 2016 | |||||||||||||||
| Revenue: | |||||||||||||||||
| Engineered Products | $ | 1,633,147 | $ | 1,626,856 | $ | 1,475,680 | |||||||||||
| Fueling Solutions | 1,465,590 | 1,338,062 | 848,109 | ||||||||||||||
| Imaging & Identification | 1,109,843 | 1,041,188 | 971,058 | ||||||||||||||
| Pumps & Process Solutions | 1,331,893 | 1,217,235 | 1,129,008 | ||||||||||||||
| Refrigeration & Food Equipment | 1,453,093 | 1,599,105 | 1,620,339 | ||||||||||||||
| Intra-segment eliminations | (1,448) | (1,560) | (970) | ||||||||||||||
| Total consolidated revenue | $ | 6,992,118 | $ | 6,820,886 | $ | 6,043,224 | |||||||||||
| Earnings from continuing operations: | |||||||||||||||||
Segment earnings (EBIT): 1 | |||||||||||||||||
| Engineered Products | $ | 252,368 | $ | 437,079 | $ | 239,985 | |||||||||||
| Fueling Solutions | 152,255 | 159,180 | 74,778 | ||||||||||||||
| Imaging & Identification | 198,902 | 167,404 | 159,223 | ||||||||||||||
| Pumps & Process Solutions | 237,549 | 209,451 | 171,768 | ||||||||||||||
| Refrigeration & Food Equipment | 136,119 | 193,822 | 283,628 | ||||||||||||||
| Total segment earnings | 977,193 | 1,166,936 | 929,382 | ||||||||||||||
Corporate expense / other 2 | 129,724 | 154,664 | 115,521 | ||||||||||||||
| Interest expense | 130,972 | 144,948 | 135,969 | ||||||||||||||
| Interest income | (8,881) | (8,491) | (6,752) | ||||||||||||||
| Earnings before provision for income taxes and discontinued operations | 725,378 | 875,815 | 684,644 | ||||||||||||||
| Provision for income taxes | 134,233 | 129,152 | 182,516 | ||||||||||||||
| Earnings from continuing operations | $ | 591,145 | $ | 746,663 | $ | 502,128 | |||||||||||
| Segment margins: | |||||||||||||||||
Engineered Products 3 | 15.5 | % | 26.9 | % | 16.3 | % | |||||||||||
| Fueling Solutions | 10.4 | % | 11.9 | % | 8.8 | % | |||||||||||
| Imaging & Identification | 17.9 | % | 16.1 | % | 16.4 | % | |||||||||||
| Pumps & Process Solutions | 17.8 | % | 17.2 | % | 15.2 | % | |||||||||||
Refrigeration & Food Equipment 3 | 9.4 | % | 12.1 | % | 17.5 | % | |||||||||||
| Total Segments | 14.0 | % | 17.1 | % | 15.4 | % | |||||||||||
| Earnings from continuing operations | 8.5 | % | 10.9 | % | 8.3 | % | |||||||||||
| Depreciation and amortization: | |||||||||||||||||
| Engineered Products | $ | 44,996 | $ | 48,271 | $ | 42,388 | |||||||||||
| Fueling Solutions | 68,463 | 67,835 | 34,753 | ||||||||||||||
| Imaging & Identification | 30,882 | 37,176 | 35,785 | ||||||||||||||
| Pumps & Process Solutions | 71,982 | 67,986 | 66,513 | ||||||||||||||
| Refrigeration & Food Equipment | 60,477 | 57,207 | 65,018 | ||||||||||||||
| Corporate | 5,780 | 4,803 | 5,215 | ||||||||||||||
| Consolidated total | $ | 282,580 | $ | 283,278 | $ | 249,672 | |||||||||||
| Capital expenditures: | |||||||||||||||||
| Engineered Products | $ | 34,016 | $ | 25,762 | $ | 25,678 | |||||||||||
| Fueling Solutions | 55,702 | 61,420 | 42,369 | ||||||||||||||
| Imaging & Identification | 13,029 | 11,733 | 6,696 | ||||||||||||||
| Pumps & Process Solutions | 30,863 | 29,205 | 25,778 | ||||||||||||||
| Refrigeration & Food Equipment | 32,482 | 32,541 | 23,651 | ||||||||||||||
| Corporate | 4,902 | 9,407 | 15,406 | ||||||||||||||
| Consolidated total | $ | 170,994 | $ | 170,068 | $ | 139,578 | |||||||||||
| Total assets at December 31: | 2018 | 2017 | |||||||||
| Engineered Products | $ | 1,477,671 | $ | 1,475,868 | |||||||
| Fueling Solutions | 1,872,736 | 1,891,128 | |||||||||
| Imaging & Identification | 1,592,349 | 1,621,199 | |||||||||
| Pumps & Process Solutions | 1,585,416 | 1,519,505 | |||||||||
| Refrigeration & Food Equipment | 1,252,870 | 1,284,852 | |||||||||
Corporate 4 | 584,729 | 1,000,254 | |||||||||
| Total assets - continuing operations | 8,365,771 | 8,792,806 | |||||||||
| Assets from discontinued operations | — | 1,865,553 | |||||||||
| Consolidated total | $ | 8,365,771 | $ | 10,658,359 | |||||||
1 Segment earnings includes non-operating income and expense directly attributable to the segments. Non-operating income and expense includes Gain on sale of businesses and other expense (income), net.
2 Certain expenses are maintained at the corporate level and not allocated to the segments. These expenses include executive and functional compensation costs, non-service pension costs, non-operating insurance expenses, shared business services costs and various administrative expenses relating to the corporate headquarters.
3 2017 segment income for Engineered Products includes impact of gain from the sale of Warn Industries and PMI of $116,932 and $88,402, respectively. 2016 segment income for Refrigeration & Food Equipment includes impact of gain from the sale of Tipper Tie of $85,035.
4 The significant portion of corporate assets are principally cash and cash equivalents.
DOVER CORPORATION
QUARTERLY SEGMENT INFORMATION
(unaudited)(in thousands)
| 2019 | 2018 | |||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q4 | FY 2018 | ||||||||||||||||||||||||
| REVENUE | ||||||||||||||||||||||||||||||||
| Engineered Products | $ | 418,851 | $ | 429,928 | $ | 426,689 | $ | 1,275,468 | $ | 402,980 | $ | 416,552 | $ | 401,243 | $ | 412,372 | $ | 1,633,147 | ||||||||||||||
| Fueling Solutions | 373,050 | 390,586 | 411,769 | 1,175,405 | 319,304 | 363,355 | 367,617 | 415,314 | 1,465,590 | |||||||||||||||||||||||
| Imaging & Identification | 268,354 | 266,588 | 275,109 | 810,051 | 268,654 | 286,458 | 270,299 | 284,432 | 1,109,843 | |||||||||||||||||||||||
| Pumps & Process Solutions | 330,219 | 338,924 | 341,337 | 1,010,480 | 308,840 | 330,337 | 322,506 | 370,210 | 1,331,893 | |||||||||||||||||||||||
| Refrigeration & Food Equipment | 334,643 | 385,474 | 370,335 | 1,090,452 | 338,235 | 401,766 | 386,214 | 326,878 | 1,453,093 | |||||||||||||||||||||||
| Intra-segment eliminations | (360) | (794) | 106 | (1,048) | (342) | (374) | (476) | (256) | (1,448) | |||||||||||||||||||||||
| Total consolidated revenue | $ | 1,724,757 | $ | 1,810,706 | $ | 1,825,345 | $ | 5,360,808 | $ | 1,637,671 | $ | 1,798,094 | $ | 1,747,403 | $ | 1,808,950 | $ | 6,992,118 | ||||||||||||||
| NET EARNINGS | ||||||||||||||||||||||||||||||||
| Segment Earnings (EBIT): | ||||||||||||||||||||||||||||||||
| Engineered Products | $ | 67,119 | $ | 77,129 | $ | 74,367 | $ | 218,615 | $ | 59,363 | $ | 67,331 | $ | 64,570 | $ | 61,104 | $ | 252,368 | ||||||||||||||
| Fueling Solutions | 37,230 | 52,637 | 68,069 | 157,936 | 22,709 | 35,342 | 40,615 | 53,589 | 152,255 | |||||||||||||||||||||||
| Imaging & Identification | 55,955 | 54,641 | 61,655 | 172,251 | 42,703 | 59,318 | 44,144 | 52,737 | 198,902 | |||||||||||||||||||||||
Pumps & Process Solutions 1 | 14,991 | 76,278 | 77,433 | 168,702 | 44,639 | 57,686 | 60,592 | 74,632 | 237,549 | |||||||||||||||||||||||
| Refrigeration & Food Equipment | 24,807 | 44,375 | 35,211 | 104,393 | 29,182 | 51,372 | 42,434 | 13,131 | 136,119 | |||||||||||||||||||||||
| Total segments | 200,102 | 305,060 | 316,735 | 821,897 | 198,596 | 271,049 | 252,355 | 255,193 | 977,193 | |||||||||||||||||||||||
| Corporate expense / other | 30,866 | 24,512 | 28,658 | 84,036 | 30,763 | 30,050 | 30,207 | 38,704 | 129,724 | |||||||||||||||||||||||
| Interest expense | 31,808 | 31,754 | 31,410 | 94,972 | 35,640 | 32,125 | 31,192 | 32,015 | 130,972 | |||||||||||||||||||||||
| Interest income | (890) | (945) | (1,263) | (3,098) | (2,057) | (2,563) | (2,060) | (2,201) | (8,881) | |||||||||||||||||||||||
| Earnings before provision for income taxes | 138,318 | 249,739 | 257,930 | 645,987 | 134,250 | 211,437 | 193,016 | 186,675 | 725,378 | |||||||||||||||||||||||
| Provision for income taxes | 32,613 | 51,654 | 51,924 | 136,191 | 24,841 | 44,981 | 35,711 | 28,700 | 134,233 | |||||||||||||||||||||||
| Earnings from continuing operations | 105,705 | 198,085 | 206,006 | 509,796 | 109,409 | 166,456 | 157,305 | 157,975 | 591,145 | |||||||||||||||||||||||
| Earnings (loss) from discontinued operations, net | — | — | — | — | 22,025 | (26,497) | — | (16,406) | (20,878) | |||||||||||||||||||||||
| Net earnings | $ | 105,705 | $ | 198,085 | $ | 206,006 | $ | 509,796 | $ | 131,434 | $ | 139,959 | $ | 157,305 | $ | 141,569 | $ | 570,267 | ||||||||||||||
| SEGMENT MARGIN | ||||||||||||||||||||||||||||||||
| Engineered Products | 16.0 | % | 17.9 | % | 17.4 | % | 17.1 | % | 14.7 | % | 16.2 | % | 16.1 | % | 14.8 | % | 15.5 | % | ||||||||||||||
| Fueling Solutions | 10.0 | % | 13.5 | % | 16.5 | % | 13.4 | % | 7.1 | % | 9.7 | % | 11.0 | % | 12.9 | % | 10.4 | % | ||||||||||||||
| Imaging & Identification | 20.9 | % | 20.5 | % | 22.4 | % | 21.3 | % | 15.9 | % | 20.7 | % | 16.3 | % | 18.5 | % | 17.9 | % | ||||||||||||||
Pumps & Process Solutions 1 | 4.5 | % | 22.5 | % | 22.7 | % | 16.7 | % | 14.5 | % | 17.5 | % | 18.8 | % | 20.2 | % | 17.8 | % | ||||||||||||||
| Refrigeration & Food Equipment | 7.4 | % | 11.5 | % | 9.5 | % | 9.6 | % | 8.6 | % | 12.8 | % | 11.0 | % | 4.0 | % | 9.4 | % | ||||||||||||||
| Total segment operating margin | 11.6 | % | 16.8 | % | 17.4 | % | 15.3 | % | 12.1 | % | 15.1 | % | 14.4 | % | 14.1 | % | 14.0 | % | ||||||||||||||
| DEPRECIATION AND AMORTIZATION EXPENSE | ||||||||||||||||||||||||||||||||
| Engineered Products | $ | 10,359 | $ | 10,452 | $ | 10,095 | $ | 30,906 | $ | 11,443 | $ | 11,286 | $ | 10,528 | $ | 11,739 | $ | 44,996 | ||||||||||||||
| Fueling Solutions | 17,879 | 18,945 | 18,744 | 55,568 | 17,017 | 17,241 | 16,877 | 17,328 | 68,463 | |||||||||||||||||||||||
| Imaging & Identification | 7,435 | 7,413 | 7,360 | 22,208 | 7,797 | 7,916 | 7,675 | 7,494 | 30,882 | |||||||||||||||||||||||
| Pumps & Process Solutions | 17,548 | 16,201 | 16,018 | 49,767 | 17,431 | 17,741 | 18,078 | 18,732 | 71,982 | |||||||||||||||||||||||
| Refrigeration & Food Equipment | 13,011 | 12,777 | 13,047 | 38,835 | 13,579 | 13,524 | 13,533 | 19,841 | 60,477 | |||||||||||||||||||||||
| Corporate | 1,506 | 1,981 | 1,523 | 5,010 | 1,358 | 1,595 | 1,399 | 1,428 | 5,780 | |||||||||||||||||||||||
| Total depreciation and amortization expense | $ | 67,738 | $ | 67,769 | $ | 66,787 | $ | 202,294 | $ | 68,625 | $ | 69,303 | $ | 68,090 | $ | 76,562 | $ | 282,580 | ||||||||||||||
1 Q1 and Q3 YTD 2019 includes a $46,946 loss on assets held for sale for Finder Pompe S.r.l. ("Finder"). | ||||||||||||||||||||||||||||||||
DOVER CORPORATION
QUARTERLY SEGMENT ADJUSTED EBIT AND ADJUSTED EBITDA
(unaudited)(in thousands)
| 2019 | 2018 | |||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q4 | FY 2018 | ||||||||||||||||||||||||
| ADJUSTED SEGMENT EBIT AND ADJUSTED EBITDA | ||||||||||||||||||||||||||||||||
| Engineered Products: | ||||||||||||||||||||||||||||||||
| Segment earnings (EBIT) | $ | 67,119 | $ | 77,129 | $ | 74,367 | $ | 218,615 | $ | 59,363 | $ | 67,331 | $ | 64,570 | $ | 61,104 | $ | 252,368 | ||||||||||||||
| Rightsizing and other costs | 80 | 1,125 | 590 | 1,795 | 463 | 417 | 2,713 | 3,693 | 7,286 | |||||||||||||||||||||||
| Adjusted EBIT - Segment | 67,199 | 78,254 | 74,957 | 220,410 | 59,826 | 67,748 | 67,283 | 64,797 | 259,654 | |||||||||||||||||||||||
| Adjusted EBIT % | 16.0 | % | 18.2 | % | 17.6 | % | 17.3 | % | 14.8 | % | 16.3 | % | 16.8 | % | 15.7 | % | 15.9 | % | ||||||||||||||
Adjusted depreciation and amortization expense 2 | 10,359 | 9,855 | 10,095 | 30,309 | 11,443 | 11,286 | 10,528 | 11,230 | 44,487 | |||||||||||||||||||||||
| Adjusted EBITDA - segment | $ | 77,558 | $ | 88,109 | $ | 85,052 | $ | 250,719 | $ | 71,269 | $ | 79,034 | $ | 77,811 | $ | 76,027 | $ | 304,141 | ||||||||||||||
| Adjusted EBITDA % | 18.5 | % | 20.5 | % | 19.9 | % | 19.7 | % | 17.7 | % | 19.0 | % | 19.4 | % | 18.4 | % | 18.6 | % | ||||||||||||||
| Fueling Solutions: | ||||||||||||||||||||||||||||||||
| Segment earnings (EBIT) | $ | 37,230 | $ | 52,637 | $ | 68,069 | $ | 157,936 | $ | 22,709 | $ | 35,342 | $ | 40,615 | $ | 53,589 | $ | 152,255 | ||||||||||||||
| Rightsizing and other costs | 752 | 1,768 | 811 | 3,331 | 1,112 | 1,623 | 5,922 | 6,675 | 15,332 | |||||||||||||||||||||||
| Adjusted EBIT - Segment | 37,982 | 54,405 | 68,880 | 161,267 | 23,821 | 36,965 | 46,537 | 60,264 | 167,587 | |||||||||||||||||||||||
| Adjusted EBIT % | 10.2 | % | 13.9 | % | 16.7 | % | 13.7 | % | 7.5 | % | 10.2 | % | 12.7 | % | 14.5 | % | 11.4 | % | ||||||||||||||
Adjusted depreciation and amortization expense 2 | 17,879 | 18,945 | 18,744 | 55,568 | 17,017 | 17,241 | 16,877 | 17,328 | 68,463 | |||||||||||||||||||||||
| Adjusted EBITDA - segment | $ | 55,861 | $ | 73,350 | $ | 87,624 | $ | 216,835 | $ | 40,838 | $ | 54,206 | $ | 63,414 | $ | 77,592 | $ | 236,050 | ||||||||||||||
| Adjusted EBITDA % | 15.0 | % | 18.8 | % | 21.3 | % | 18.4 | % | 12.8 | % | 14.9 | % | 17.3 | % | 18.7 | % | 16.1 | % | ||||||||||||||
| Imaging & Identification: | ||||||||||||||||||||||||||||||||
| Segment earnings (EBIT) | $ | 55,955 | $ | 54,641 | $ | 61,655 | $ | 172,251 | $ | 42,703 | $ | 59,318 | $ | 44,144 | $ | 52,737 | $ | 198,902 | ||||||||||||||
| Rightsizing and other costs | 389 | 1,268 | 301 | 1,958 | 899 | 347 | 7,923 | 3,476 | 12,645 | |||||||||||||||||||||||
| Adjusted EBIT - Segment | 56,344 | 55,909 | 61,956 | 174,209 | 43,602 | 59,665 | 52,067 | 56,213 | 211,547 | |||||||||||||||||||||||
| Adjusted EBIT % | 21.0 | % | 21.0 | % | 22.5 | % | 21.5 | % | 16.2 | % | 20.8 | % | 19.3 | % | 19.8 | % | 19.1 | % | ||||||||||||||
Adjusted depreciation and amortization expense 2 | 7,336 | 7,317 | 7,286 | 21,939 | 7,797 | 7,916 | 7,675 | 7,392 | 30,780 | |||||||||||||||||||||||
| Adjusted EBITDA - segment | $ | 63,680 | $ | 63,226 | $ | 69,242 | $ | 196,148 | $ | 51,399 | $ | 67,581 | $ | 59,742 | $ | 63,605 | $ | 242,327 | ||||||||||||||
| Adjusted EBITDA % | 23.7 | % | 23.7 | % | 25.2 | % | 24.2 | % | 19.1 | % | 23.6 | % | 22.1 | % | 22.4 | % | 21.8 | % | ||||||||||||||
| Pumps & Process Solutions: | ||||||||||||||||||||||||||||||||
| Segment earnings (EBIT) | $ | 14,991 | $ | 76,278 | $ | 77,433 | $ | 168,702 | $ | 44,639 | $ | 57,686 | $ | 60,592 | $ | 74,632 | $ | 237,549 | ||||||||||||||
| Rightsizing and other costs | 414 | 903 | 943 | 2,260 | 653 | 2,071 | 4,552 | 6,099 | 13,375 | |||||||||||||||||||||||
Loss on assets held for sale 1 | 46,946 | — | — | 46,946 | — | — | — | — | — | |||||||||||||||||||||||
| Adjusted EBIT - Segment | 62,351 | 77,181 | 78,376 | 217,908 | 45,292 | 59,757 | 65,144 | 80,731 | 250,924 | |||||||||||||||||||||||
| Adjusted EBIT % | 18.9 | % | 22.8 | % | 23.0 | % | 21.6 | % | 14.7 | % | 18.1 | % | 20.2 | % | 21.8 | % | 18.8 | % | ||||||||||||||
Adjusted depreciation and amortization expense 2 | 17,548 | 16,199 | 16,018 | 49,765 | 17,431 | 17,741 | 18,078 | 17,823 | 71,073 | |||||||||||||||||||||||
| Adjusted EBITDA - segment | $ | 79,899 | $ | 93,380 | $ | 94,394 | $ | 267,673 | $ | 62,723 | $ | 77,498 | $ | 83,222 | $ | 98,554 | $ | 321,997 | ||||||||||||||
| Adjusted EBITDA % | 24.2 | % | 27.6 | % | 27.7 | % | 26.5 | % | 20.3 | % | 23.5 | % | 25.8 | % | 26.6 | % | 24.2 | % | ||||||||||||||
| Refrigeration & Food Equipment: | ||||||||||||||||||||||||||||||||
| Segment earnings (EBIT) | $ | 24,807 | $ | 44,375 | $ | 35,211 | $ | 104,393 | $ | 29,182 | $ | 51,372 | $ | 42,434 | $ | 13,131 | $ | 136,119 | ||||||||||||||
| Rightsizing and other costs | 2,293 | 666 | 840 | 3,799 | — | — | 451 | 9,498 | 9,949 | |||||||||||||||||||||||
| Adjusted EBIT - Segment | 27,100 | 45,041 | 36,051 | 108,192 | 29,182 | 51,372 | 42,885 | 22,629 | 146,068 | |||||||||||||||||||||||
| Adjusted EBIT % | 8.1 | % | 11.7 | % | 9.7 | % | 9.9 | % | 8.6 | % | 12.8 | % | 11.1 | % | 6.9 | % | 10.1 | % | ||||||||||||||
Adjusted depreciation and amortization expense 2 | 13,011 | 12,777 | 13,047 | 38,835 | 13,579 | 13,524 | 13,533 | 13,541 | 54,177 | |||||||||||||||||||||||
| Adjusted EBITDA - segment | $ | 40,111 | $ | 57,818 | $ | 49,098 | $ | 147,027 | $ | 42,761 | $ | 64,896 | $ | 56,418 | $ | 36,170 | $ | 200,245 | ||||||||||||||
| Adjusted EBITDA % | 12.0 | % | 15.0 | % | 13.3 | % | 13.5 | % | 12.6 | % | 16.2 | % | 14.6 | % | 11.1 | % | 13.8 | % | ||||||||||||||
1 Q1 and Q3 YTD 2019 includes a $46,946 loss on assets held for sale for Finder Pompe S.r.l. ("Finder"). | ||||||||||||||||||||||||||||||||
2 Adjusted depreciation and amortization expense excludes depreciation and amortization included within rightsizing and other costs. | ||||||||||||||||||||||||||||||||
DOVER CORPORATION
QUARTERLY SEGMENT INFORMATION
(continued)
(unaudited)(in thousands)
| 2019 | 2018 | |||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q4 | FY 2018 | ||||||||||||||||||||||||
| BOOKINGS | ||||||||||||||||||||||||||||||||
| Engineered Products | $ | 427,697 | $ | 397,420 | $ | 426,059 | $ | 1,251,176 | $ | 480,513 | $ | 425,322 | $ | 403,098 | $ | 494,622 | $ | 1,803,555 | ||||||||||||||
| Fueling Solutions | 343,083 | 394,256 | 450,727 | 1,188,066 | 360,519 | 392,100 | 383,749 | 376,651 | 1,513,019 | |||||||||||||||||||||||
| Imaging & Identification | 267,762 | 264,175 | 284,527 | 816,464 | 270,653 | 294,248 | 258,883 | 282,519 | 1,106,303 | |||||||||||||||||||||||
| Pumps & Process Solutions | 369,801 | 375,905 | 329,642 | 1,075,348 | 342,991 | 345,278 | 340,287 | 358,319 | 1,386,875 | |||||||||||||||||||||||
| Refrigeration & Food Equipment | 376,998 | 384,365 | 323,422 | 1,084,785 | 372,701 | 428,816 | 331,979 | 341,221 | 1,474,717 | |||||||||||||||||||||||
| Intra-segment eliminations | (725) | (490) | (528) | (1,743) | (680) | (25) | (597) | (617) | (1,919) | |||||||||||||||||||||||
| Total consolidated bookings | $ | 1,784,616 | $ | 1,815,631 | $ | 1,813,849 | $ | 5,414,096 | $ | 1,826,697 | $ | 1,885,739 | $ | 1,717,399 | $ | 1,852,715 | $ | 7,282,550 | ||||||||||||||
| BACKLOG | ||||||||||||||||||||||||||||||||
| Engineered Products | $ | 451,335 | $ | 418,154 | $ | 416,025 | $ | 380,846 | $ | 375,975 | $ | 370,948 | $ | 442,519 | ||||||||||||||||||
| Fueling Solutions | 185,847 | 186,202 | 223,081 | 229,234 | 246,087 | 251,212 | 208,574 | |||||||||||||||||||||||||
| Imaging & Identification | 118,177 | 116,810 | 121,877 | 131,544 | 133,570 | 123,624 | 118,057 | |||||||||||||||||||||||||
| Pumps & Process Solutions | 353,066 | 378,427 | 361,478 | 315,020 | 318,891 | 337,420 | 315,230 | |||||||||||||||||||||||||
| Refrigeration & Food Equipment | 311,632 | 310,454 | 262,870 | 283,250 | 309,440 | 255,783 | 268,991 | |||||||||||||||||||||||||
| Intra-segment eliminations | (403) | (141) | (252) | (394) | (154) | (58) | (200) | |||||||||||||||||||||||||
| Total consolidated backlog | $ | 1,419,654 | $ | 1,409,906 | $ | 1,385,079 | $ | 1,339,500 | $ | 1,383,809 | $ | 1,338,929 | $ | 1,353,171 | ||||||||||||||||||
DOVER CORPORATION
QUARTERLY EARNINGS PER SHARE
(unaudited)(in thousands, except per share data*)
| Earnings Per Share | ||||||||||||||||||||||||||||||||
| 2019 | 2018 | |||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q4 | FY 2018 | ||||||||||||||||||||||||
| Basic earnings (loss) per common share: | ||||||||||||||||||||||||||||||||
| Continuing operations | $ | 0.73 | $ | 1.36 | $ | 1.42 | $ | 3.51 | $ | 0.71 | $ | 1.10 | $ | 1.07 | $ | 1.08 | $ | 3.94 | ||||||||||||||
| Discontinued operations | — | — | — | — | 0.14 | (0.17) | — | (0.11) | (0.14) | |||||||||||||||||||||||
| Net earnings | $ | 0.73 | $ | 1.36 | $ | 1.42 | $ | 3.51 | $ | 0.85 | $ | 0.92 | $ | 1.07 | $ | 0.97 | $ | 3.80 | ||||||||||||||
| Diluted earnings (loss) per common share: | ||||||||||||||||||||||||||||||||
| Continuing operations | $ | 0.72 | $ | 1.35 | $ | 1.40 | $ | 3.47 | $ | 0.70 | $ | 1.08 | $ | 1.05 | $ | 1.07 | $ | 3.89 | ||||||||||||||
| Discontinued operations | — | — | — | — | 0.14 | (0.17) | — | (0.11) | (0.14) | |||||||||||||||||||||||
| Net earnings | $ | 0.72 | $ | 1.35 | $ | 1.40 | $ | 3.47 | $ | 0.84 | $ | 0.91 | $ | 1.05 | $ | 0.96 | $ | 3.75 | ||||||||||||||
| Net earnings (loss) and weighted average shares used in calculated earnings per share amounts are as follows: | ||||||||||||||||||||||||||||||||
| Net earnings (loss): | ||||||||||||||||||||||||||||||||
| Continuing operations | $ | 105,705 | $ | 198,085 | $ | 206,006 | $ | 509,796 | $ | 109,409 | $ | 166,456 | $ | 157,305 | $ | 157,975 | $ | 591,145 | ||||||||||||||
| Discontinued operations | — | — | — | — | 22,025 | (26,497) | — | (16,406) | (20,878) | |||||||||||||||||||||||
| Net earnings | $ | 105,705 | $ | 198,085 | $ | 206,006 | $ | 509,796 | $ | 131,434 | $ | 139,959 | $ | 157,305 | $ | 141,569 | $ | 570,267 | ||||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||||||||||||||
| Basic | 145,087 | 145,366 | 145,372 | 145,276 | 154,520 | 151,744 | 147,344 | 146,007 | 149,874 | |||||||||||||||||||||||
| Diluted | 146,911 | 147,179 | 147,051 | 147,053 | 157,090 | 153,938 | 149,457 | 147,940 | 152,133 | |||||||||||||||||||||||
| * Per share data may be impacted by rounding. | ||||||||||||||||||||||||||||||||
Non-GAAP Reconciliations
| Adjusted Earnings Per Share (Non-GAAP) | ||||||||||||||||||||||||||||||||
| Earnings from continuing operations are adjusted by the effect of acquisition-related amortization, rightsizing and other costs, loss on assets held for sale, and the Tax Cuts and Jobs Act to derive adjusted earnings from continuing operations and adjusted diluted earnings per common share as follows: | ||||||||||||||||||||||||||||||||
| 2019 | 2018 | |||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q4 | FY 2018 | ||||||||||||||||||||||||
| Adjusted earnings: | ||||||||||||||||||||||||||||||||
| Earnings from continuing operations | $ | 105,705 | $ | 198,085 | $ | 206,006 | $ | 509,796 | $ | 109,409 | $ | 166,456 | $ | 157,305 | $ | 157,975 | $ | 591,145 | ||||||||||||||
Acquisition-related amortization, pre-tax 1 | 35,635 | 34,997 | 34,244 | 104,876 | 38,150 | 38,072 | 34,997 | 35,078 | 146,297 | |||||||||||||||||||||||
Acquisition-related amortization, tax impact 2 | (8,964) | (8,777) | (8,624) | (26,365) | (9,716) | (9,683) | (8,785) | (8,817) | (37,001) | |||||||||||||||||||||||
Rightsizing and other costs, pre-tax 3 | 3,963 | 6,457 | 3,807 | 14,227 | 4,371 | 6,808 | 24,201 | 37,448 | 72,828 | |||||||||||||||||||||||
Rightsizing and other costs, tax impact 2 | (861) | (1,377) | (806) | (3,044) | (797) | (1,448) | (4,477) | (7,809) | (14,531) | |||||||||||||||||||||||
Loss on assets held for sale 4 | 46,946 | — | — | 46,946 | — | — | — | — | — | |||||||||||||||||||||||
Tax Cuts and Jobs Act 5 | — | — | — | — | — | — | — | (2,832) | (2,832) | |||||||||||||||||||||||
Adjusted earnings from continuing operations | $ | 182,424 | $ | 229,385 | $ | 234,627 | $ | 646,436 | $ | 141,417 | $ | 200,205 | $ | 203,241 | $ | 211,043 | $ | 755,906 | ||||||||||||||
| Adjusted diluted earnings per common share*: | ||||||||||||||||||||||||||||||||
| Diluted earnings per share from continuing operations | $ | 0.72 | $ | 1.35 | $ | 1.40 | $ | 3.47 | $ | 0.70 | $ | 1.08 | $ | 1.05 | $ | 1.07 | $ | 3.89 | ||||||||||||||
Acquisition-related amortization, pre-tax 1 | 0.24 | 0.24 | 0.23 | 0.71 | 0.24 | 0.25 | 0.23 | 0.24 | 0.96 | |||||||||||||||||||||||
Acquisition-related amortization, tax impact 2 | (0.06) | (0.06) | (0.06) | (0.18) | (0.06) | (0.06) | (0.06) | (0.06) | (0.24) | |||||||||||||||||||||||
Rightsizing and other costs, pre-tax 3 | 0.03 | 0.04 | 0.03 | 0.10 | 0.03 | 0.04 | 0.16 | 0.25 | 0.48 | |||||||||||||||||||||||
Rightsizing and other costs, tax impact 2 | (0.01) | (0.01) | (0.01) | (0.02) | (0.01) | (0.01) | (0.03) | (0.05) | (0.10) | |||||||||||||||||||||||
Loss on assets held for sale 4 | 0.32 | — | — | 0.32 | — | — | — | — | — | |||||||||||||||||||||||
Tax Cuts and Jobs Act 5 | — | — | — | — | — | — | — | (0.02) | (0.02) | |||||||||||||||||||||||
Adjusted diluted earnings per share from continuing operations | $ | 1.24 | $ | 1.56 | $ | 1.60 | $ | 4.40 | $ | 0.90 | $ | 1.30 | $ | 1.36 | $ | 1.43 | $ | 4.97 | ||||||||||||||
1 Includes amortization on acquisition-related intangible assets and inventory step-up. | ||||||||||||||||||||||||||||||||
2 Adjustments were tax effected using the statutory tax rates in the applicable jurisdictions or the effective tax rate, where applicable, for each period. | ||||||||||||||||||||||||||||||||
3 Rightsizing and other costs include actions taken on employee reductions, facility consolidations and site closures, product line exits and other associated asset charges. | ||||||||||||||||||||||||||||||||
4 Represents a loss on assets held for sale of Finder. Under local law, no tax benefit is realized from the loss on the sale of a wholly-owned business. | ||||||||||||||||||||||||||||||||
5 2018 tax benefits related to additional Tax Cuts and Jobs Act regulatory guidance covered by SAB 118. | ||||||||||||||||||||||||||||||||
| * Per share data and totals may be impacted by rounding. | ||||||||||||||||||||||||||||||||
DOVER CORPORATION
REVENUE GROWTH FACTORS
(unaudited)(in thousands)
| Revenue Growth Factors | |||||||||||||||||
| Nine Months Ended September 30, | Years Ended December 31, | ||||||||||||||||
| 2019 | 2018 | 2017 | |||||||||||||||
| Organic: | |||||||||||||||||
| Engineered Products | 6.1 | % | 6.6 | % | 6.7 | % | |||||||||||
| Fueling Solutions | 12.7 | % | 9.9 | % | (0.5) | % | |||||||||||
| Imaging & Identification | 2.2 | % | 4.6 | % | 4.6 | % | |||||||||||
| Pumps & Process Solutions | 8.4 | % | 7.4 | % | 7.3 | % | |||||||||||
| Refrigeration & Food Equipment | (1.9) | % | (7.9) | % | 3.4 | % | |||||||||||
| Total Organic | 5.5 | % | 3.7 | % | 4.6 | % | |||||||||||
| Acquisition | 0.8 | % | 0.5 | % | 10.9 | % | |||||||||||
| Disposition | (0.4) | % | (2.5) | % | (3.1) | % | |||||||||||
| Currency Translation | (2.5) | % | 0.8 | % | 0.5 | % | |||||||||||
| Total * | 3.4 | % | 2.5 | % | 12.9 | % | |||||||||||
* Totals may be impacted by rounding.
Non-GAAP Disclosures
In an effort to provide investors with additional information regarding our results as determined by GAAP, Management also discloses non-GAAP information that Management believes provides useful information to investors. Adjusted earnings from continuing operations, adjusted diluted earnings per share from continuing operations, adjusted EBIT by segment, adjusted EBITDA by segment and organic revenue are not financial measures under GAAP and should not be considered as a substitute for earnings from continuing operations, diluted earnings per share from continuing operations, segment earnings, or revenue as determined in accordance with GAAP, and they may not be comparable to similarly titled measures reported by other companies.
Adjusted earnings from continuing operations represents earnings from continuing operations adjusted for the effect of acquisition-related amortization, rightsizing and other costs, loss on assets held for sale, and the Tax Cuts and Jobs Act. We exclude after-tax acquisition-related amortization because the amount and timing of such charges are significantly impacted by the timing, size, number and nature of the acquisitions the Company consummates. We exclude the other items because they occur for reasons that may be unrelated to the Company's commercial performance during the period and/or Management believes they are not indicative of the Company's ongoing operating costs or gains in a given period.
Adjusted diluted earnings per share from continuing operations represents adjusted earnings from continuing operations divided by average diluted shares.
Adjusted EBIT by Segment is defined as earnings from continuing operations before income taxes, net interest expense, corporate expenses, rightsizing and other costs and a 2019 loss on assets held for sale.
Adjusted EBIT Margin by Segment is defined as adjusted EBIT by segment divided by segment revenue.
Adjusted EBITDA by Segment is defined as adjusted EBIT by segment plus depreciation and amortization, excluding depreciation and amortization included within rightsizing and other costs.
Adjusted EBITDA Margin by Segment is defined as adjusted EBITDA by segment divided by segment revenue.
Management believes these measures are useful to investors to better understand the Company’s ongoing profitability as it will better reflect the Company's core operating results, offer more transparency and facilitate easier comparability to prior and future periods and to its peers.
Management believes that reporting organic revenue growth, which excludes the impact of foreign currency exchange rates and the impact of acquisitions and dispositions, provides a useful comparison of our revenue performance and trends between periods.