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): May 5, 2009
ESCO TECHNOLOGIES INC.
(Exact Name of Registrant as Specified in Charter)
Missouri 1-10596 43-1554045
(State or Other (Commission (I.R.S. Employer
Jurisdiction of Incorporation) File Number) Identification No.)
9900A Clayton Road, St. Louis, Missouri 63124-1186
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 314-213-7200
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:
[ ] 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 240.113d-4 (c))
ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION
Today, May 5, 2009, the Registrant is issuing a press release (furnished
herewith as Exhibit 99.1 to this report) announcing its fiscal year 2009 second
quarter financial and operating results. See Item 7.01, Regulation FD Disclosure
below.
ITEM 7.01 REGULATION FD DISCLOSURE
Today, the Registrant is issuing a press release (Exhibit 99.1) announcing its
fiscal year 2009 second quarter financial and operating results. The Registrant
will conduct a related Webcast conference call today at 4:00 p.m. central time.
This press release will be posted on the Registrant's web site located at
http://www.escotechnologies.com. It can be viewed through the "Investor
Relations" page of the web site under the tab "Press Releases", although the
Registrant reserves the right to discontinue that availability at any time.
NON-GAAP FINANCIAL MEASURES
The press release furnished herewith as Exhibit 99.1 contains financial measures
and financial terms not calculated in accordance with generally accepted
accounting principles in the United States of America ("GAAP") in order to
provide investors and management with an alternative method for assessing the
Registrant's operating results in a manner that is focused on the performance of
the Registrant's ongoing operations. The Registrant has provided definitions
below for the non-GAAP financial measures utilized in the press release,
together with an explanation of why management uses these measures, and why
management believes that these non-GAAP financial measures are useful to
investors. The press release uses the non-GAAP financial measures of "EBIT",
"EBIT margin" and "EPS-Adjusted Basis".
The Registrant defines "EBIT" as earnings before interest and taxes from
continuing operations. The Registrant defines "EBIT margin" as EBIT as a percent
of net sales. The Registrant's management evaluates the performance of its
operating segments based on EBIT and EBIT margin, and believes that EBIT and
EBIT margin are useful to investors to demonstrate the operational profitability
of the Registrant's business segments by excluding interest and taxes, which are
generally accounted for across the entire Registrant on a consolidated basis.
EBIT is also one of the measures used by management in determining resource
allocations within the Registrant and incentive compensation. The Registrant
defines "EPS-Adjusted Basis" as "EPS- GAAP Basis" exclusive of pre-tax
intangible asset amortization expense related to TWACS NG software, purchase
accounting intangible asset amortization related to the Registrant's
acquisitions within the past three years, and the expense related to the
purchase accounting step-up of Doble Engineering Company inventory. The
Registrant's management believes using "EPS-Adjusted Basis" as a financial
measure is important for management and investors to understand the Company's
operations and its ability to service its debt.
The Registrant believes that the presentation of these operational measures
provides important supplemental information to management and investors
regarding financial and business trends relating to the Registrant's financial
condition and results of operations. The Registrant's management believes that
these measures provide an alternative method for assessing the Registrant's
expected future performance that is useful because they facilitate comparisons
with other companies in the Utility Solutions Group segment industry, many of
which use similar non-GAAP financial measures to supplement their GAAP results.
The Registrant provides this information to investors to enable them to perform
additional analyses of present and future operating performance, compare the
Registrant to other companies, and evaluate the Registrant's ongoing financial
operations.
The presentation of the information described above is intended to supplement
investors' understanding of the Registrant's operating performance. The
Registrant's non-GAAP financial measures may not be comparable to other
companies' non-GAAP financial performance measures. Furthermore, these measures
are not intended to replace net earnings (loss), cash flows, financial position,
comprehensive income (loss), or any other measure as determined in accordance
with GAAP.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits
Exhibit No. Description of Exhibit
99.1 Press Release dated May 5, 2009
OTHER MATTERS
The information in this report furnished pursuant to Item 2.02 and Item 7.01,
including Exhibit 99.1, shall not be deemed to be "filed" for purposes of
Section 18 of the Securities Exchange Act of 1934 as amended ("Exchange Act") or
otherwise subject to the liabilities of that section, unless the Registrant
incorporates it by reference into a filing under the Securities Act of 1933 as
amended or the Exchange Act.
SIGNATURE
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.
ESCO TECHNOLOGIES INC.
Dated: May 5, 2009 By: /s/ G.E. Muenster
G.E. Muenster
Executive Vice President and
Chief Financial Officer
EXHIBIT INDEX
Exhibit No. Description of Exhibit
99.1 Press Release dated May 5, 2009
Exhibit 99.1
NEWS FROM ESCO TECHNOLOGIES
For more information contact: For media inquiries:
Patricia K. Moore David P. Garino
Director, Investor Relations (314) 982-0551
ESCO Technologies Inc.
(314) 213-7277
ESCO ANNOUNCES SECOND QUARTER RESULTS
-------------------------------------
SALES UP 15 PERCENT / EPS UP 60 PERCENT
---------------------------------------
ST. LOUIS, May 5, 2009 - ESCO Technologies Inc. (NYSE: ESE) today announced
its results for the second quarter ended March 31, 2009.
Within this release, references to "quarters" and "year-to-date" relate to
the fiscal quarters and six-month periods ended March 31 for the respective
fiscal years noted.
Net earnings and EPS are presented from "Continuing Operations" and
"Discontinued Operations." Continuing Operations represent the results of the
ongoing businesses of the Company. Discontinued Operations represent the results
of Comtrak Technologies LLC which was sold in March 2009 and the filtration
business of Filtertek which was sold in November 2007 (first quarter fiscal
2008).
Second Quarter 2009 vs. 2008 Highlights - Continuing Operations
- ---------------------------------------------------------------
o Net sales increased 14.7 percent to $154.2 million.
o EBIT dollars increased 34.5 percent to $18.4 million.
o EBIT as a percentage of sales increased to 11.9 percent from 10.2 percent.
o EPS increased 60 percent to $0.40 per share from $0.25 per share.
o Net debt outstanding was $181.7 million at March 31, 2009 reflecting a
leverage ratio of 1.99x, well below the credit facility covenant of 3.5x.
o Entered orders were $156.7 million with a book-to-bill ratio of 102 percent.
o Firm orders of Aclara RF AMI products with PG&E gas were approximately
$25 million (bringing total gas product orders to over 3 million units to
date) and with New York City Water were approximately $16 million.
Chairman's Commentary
- ---------------------
Vic Richey, Chairman and Chief Executive Officer, commented, "I am very
pleased with the significant growth reflected in our second quarter operating
results, especially in this challenging global economy. Additionally, I remain
cautiously optimistic about the balance of the year based on our growth in sales
and earnings year-to-date, our strong backlog in place today, and our expected
orders for the balance of the year.
"Through regular and detailed planning meetings with our Management teams,
we continue to maintain a high degree of visibility and confidence surrounding
the balance of the fiscal year. But given the uncertainties of today's macro
environment, we are taking a more conservative posture as we address our
expected outlook for 2009. As a result of the current cycle, we are adjusting
our total year expectations to reflect a modest level of uncertainty, which I
would characterize as a reflection of our conservative planning approach.
"In spite of today's economy, we continue to see meaningful opportunities
developing across the businesses which we believe can help shield our downside
risks. To help weather this storm, we will adhere to our strict cost management
disciplines as we work our way through this cycle and demonstrate our
resiliency.
"While aggressively managing our operating costs, we will maintain our
focus on creating significant growth opportunities. To ensure future growth, we
have maintained our R&D and engineering expenditures, primarily directed toward
new product development initiatives in the AMI and Smart Grid area, along with a
significant amount of new Space program opportunities. I am confident that our
new products currently being introduced will position us well for the future.
"In closing, we are making meaningful progress at PG&E on the gas AMI
project, along with the New York City Water and Idaho Power AMI contracts."
Sales
- -----
For 2009, sales increased 14.7 percent during the second quarter and 11.8
percent for the first six months compared to the same periods of 2008. As noted
in earlier releases, the prior year sales amount included $20.5 million of
revenues recognized that had previously been deferred from prior periods related
to PG&E / TNG revenue recognition. YTD sales increased 21 percent excluding the
2008 TNG revenue recognized.
Utility Solutions Group (USG) sales in 2009 increased 27.4 percent for the
second quarter and 18.8 percent for the first six months compared to the second
quarter and first six months of 2008, respectively. Absent the TNG sales
deferral in 2008, YTD sales increased 37.1 percent from the prior year. USG
sales increases in 2009 were primarily driven by significantly higher deliveries
of fixed network RF AMI products to PG&E (gas) and continued increases in water
AMI product deliveries. Additionally, having Doble for six months of 2009 versus
four months in 2008 contributed an additional $13 million of YTD sales.
Test sales in 2009 increased slightly in the second quarter and are up 5.6
percent YTD, primarily due to an increase in large chamber deliveries to the
international wireless and electronics end-markets.
Filtration sales in 2009 decreased slightly in the second quarter and YTD
as sales increases in the defense aerospace and space product lines were offset
by lower commercial aerospace product deliveries.
Earnings Before Interest and Taxes (EBIT)
- -----------------------------------------
On a segment basis, items that impacted EBIT dollars and EBIT as a percent
of sales ("EBIT margin") during the second quarter and YTD periods of fiscal
2009 included the following:
In the USG segment, EBIT for the 2009 second quarter was $16.1 million
(17.2 percent of sales) compared to $11.2 million (15.2 percent of sales) in the
2008 second quarter. The $4.9 million increase in EBIT dollars was driven by the
significant sales increase of RF AMI products noted above. The increase in USG's
2009 YTD EBIT was mitigated by the $8.5 million of EBIT associated with the TNG
revenue recognized in 2008. The RF AMI business contributed the largest increase
to EBIT during the first six months of 2009.
In the Test segment, EBIT dollars and EBIT margins were significantly
higher in 2009 due to the sales increases in 2009, favorable changes in sales
mix, and rigorous cost controls.
In the Filtration segment, EBIT dollars and EBIT margins decreased in 2009
due to lower sales of high margin commercial aerospace products, an increase in
research and development costs, and higher bid and proposal costs incurred
related to the pursuit of a significant number of Space related projects.
Corporate operating costs were higher in 2009 due to higher amortization
expenses related to recent acquisitions that included identifiable intangible
assets.
Effective Tax Rate
- ------------------
The effective tax rate from Continuing Operations in the second quarter of
2009 was 36.1 percent compared to 37.4 percent in the second quarter of 2008.
The 2009 second quarter tax rate was consistent with the Company's guidance
provided in February 2009. The 2009 YTD rate was 34.1 percent compared to 37.6
percent and was favorably impacted by Congress' extension of the research tax
credit during the 2009 first quarter.
New Orders
- ----------
New orders received were $156.7 million and $296.2 million in the 2009
second quarter and YTD periods, respectively, compared to $162.5 million and
$293.2 million in the comparable periods of 2008. Backlog at March 31, 2009 was
$260.8 million.
Orders from PG&E for AMI gas products in the 2009 second quarter were $24.3
million, bringing the total gas project-to-date to over 3 million units, or $175
million. The entire PG&E project-to-date (gas and electric) represents 3.7
million units, worth approximately $225 million.
Cumulative orders-to-date for the $68.3 million New York City Water AMI
project were $20.9 million, and orders-to-date for the $25 million Idaho Power
AMI project were $6.2 million.
Business Outlook - 2009
- -----------------------
Statements contained in the preceding and following paragraphs are based on
current expectations. Statements that are not strictly historical are considered
forward-looking, and actual results may differ materially.
The Business Outlook described below excludes the impact of any future
acquisitions or divestitures, and reflects the impact of the amortization of
identifiable intangible purchase accounting assets related to Aclara Software,
Aclara RF, Doble and LDIC; the impact of the Doble inventory step-up resulting
in "lost" profit; and the amortization of TWACS NG software.
Aclara RF Facility Relocation
- -----------------------------
Due to its significant sales growth, Aclara RF Systems Inc. (formerly
Hexagram, Inc.) is in the process of relocating its operations from three
existing leased facilities, to a single, newer, more efficient leased facility
in the greater Cleveland area. As a result, approximately $2.0 million in pretax
nonrecurring exit and relocation costs are expected to be incurred during the
second half of fiscal 2009 in the Utility Solutions Group, primarily related to
the noncash write-off of leasehold improvements, vacant facility charges, and
moving costs.
Comtrak Technologies LLC
- ------------------------
As previously disclosed, Management had planned to exit this business, and
during March 2009, the assets of Comtrak were sold for $3.4 million and its
results of operations are included in Discontinued Operations.
Revenues and Earnings Per Share - 2009
- --------------------------------------
Based on Management's current expectations along with the sale of Comtrak,
the Company is revising its outlook for fiscal 2009 as follows:
o Revenues of approximately $650 million;
o EPS - GAAP Basis of between $1.90 and $2.00 (including $0.05 per share of
expenses related to the Aclara RF facility relocation charge noted above);
and,
o EPS - Adjusted Basis of between $2.32 and $2.42 per share.
EPS - Adjusted Basis excludes approximately $0.42 per share of costs
related to TWACS NG software amortization, purchase accounting intangible asset
amortization related to the Company's recent acquisitions, and Doble's purchase
accounting inventory step-up.
Management believes using "EPS - Adjusted Basis" as a financial measure is
important for investors to understand the Company's operations and its ability
to service its debt. The full-year 2009 tax rate is expected to be approximately
35 percent, with quarterly variations depending on the timing and amount of
discrete tax benefits and charges.
Chairman's Commentary - Wrap-Up
- -------------------------------
Mr. Richey further commented, "As noted above, I remain cautiously
optimistic about the balance of fiscal 2009. Through rigorous management
oversight and a disciplined planning process, I am confident that we have
sufficient opportunities and the appropriate contingencies in place to allow us
to execute our current plan and achieve the operating results within our range
of expectations. Having Doble for the full year and beginning our AMI
deployments with Idaho Power and New York City Water should continue to provide
us with positive momentum throughout 2009."
Conference Call
- ---------------
The Company will host a conference call today, May 5, at 4 p.m., Central
Time, to discuss the Company's second quarter operating results. A live audio
webcast will be available on the Company's web site at www.escotechnologies.com.
Please access the web site at least 15 minutes prior to the call to register,
download, and install any necessary audio software. A replay of the conference
call will be available for seven days on the Company's web site noted above or
by phone (dial 1-888-203-1112 and enter the pass code 4500221).
Forward-Looking Statements
- --------------------------
Statements in this press release regarding the amounts and timing of fiscal
2009 future revenues, results, earnings, EBIT, EPS - Adjusted Basis, EPS - GAAP
Basis, sales growth, orders, growth opportunities, success of new products and
technologies, costs incurred with the Aclara RF relocation and new building, the
fiscal 2009 effective annual tax rate, the timing and certainty of utility
customer spending, the long-term success of the Company, and any other written
or oral statements which are not strictly historical are "forward-looking"
statements within the meaning of the safe harbor provisions of the federal
securities laws. Investors are cautioned that such statements are only
predictions and speak only as of the date of this release, and the Company
undertakes no duty to update. The Company's actual results in the future may
differ materially from those projected in the forward-looking statements due to
risks and uncertainties that exist in the Company's operations and business
environment including, but not limited to: the risk factors described in Item 1A
of the Company's Annual Report on Form 10-K for the fiscal year ended September
30, 2008; the effect of the American Recovery and Reinvestment Act of 2009; the
success of the Company's competitors; changes in Federal or State energy laws;
the timing and content of purchase order releases under the Company's AMI
contracts; the Company's successful performance of its AMI contracts; site
readiness issues with Test segment customers; weakening of economic conditions
in served markets; changes in customer demands or customer insolvencies;
competition; intellectual property rights; technical difficulties; unforeseen
charges impacting corporate operating expenses; the performance of the Company's
international operations; material changes in the costs of certain raw materials
including steel and copper; delivery delays or defaults by customers;
termination for convenience of customer contracts; timing and magnitude of
future contract awards; containment of engineering and development costs;
performance issues with key customers, suppliers andsubcontractors; labor
disputes; changes in laws and regulations including but not limited to changes
in accounting standards and taxation requirements; costs relating to
environmental matters; uncertainty of disputes in litigation or arbitration; and
the Company's successful execution of internal operating plans.
ESCO, headquartered in St. Louis, is a proven supplier of special purpose
utility solutions for electric, gas, and water utilities, including hardware and
software to support advanced metering applications and fully automated
intelligent instrumentation. In addition, the Company provides engineered
filtration products to the aviation, space, and process markets worldwide and is
the industry leader in RF shielding and EMC test products. Further information
regarding ESCO and its subsidiaries is available on the Company's web site at
www.escotechnologies.com.
- -------------------------
- tables attached -
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except per share amounts)
Three Months Three Months
Ended Ended
March 31, 2009 March 31, 2008
-------------- --------------
Net Sales $154,156 134,400
Cost and Expenses:
Cost of sales 92,226 77,889
SG&A 38,237 38,535
Amortization of intangible assets 4,985 4,467
Interest expense 1,756 3,172
Other expenses (income), net 357 (136)
------- --------
Total costs and expenses 137,561 123,927
------- -------
Earnings before income taxes 16,595 10,473
Income taxes 5,990 3,912
----- -----
Net earnings from continuing operations 10,605 6,561
Loss from discontinued operations, net of
tax benefit of $101 and $292, respectively (177) (479)
Loss on sale from discontinued operations,
net of tax benefit of $905 (32) -
--- ---
Net earnings from discontinued operations (209) (479)
Net earnings $ 10,396 6,082
======== =====
Earnings per share:
Basic
Continuing operations 0.41 0.25
Discontinued operations (0.01) (0.01)
----- -----
Net earnings $ 0.40 0.24
-------- ----
Diluted
Continuing operations 0.40 0.25
Discontinued operations (0.01) (0.02)
----- -----
Net earnings $ 0.39 0.23
======== ====
Average common shares O/S:
Basic 26,177 25,847
====== ======
Diluted 26,470 26,250
====== ======
- more -
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except per share amounts)
Six Months Six Months
Ended Ended
March 31, 2009 March 31, 2008
-------------- --------------
Net Sales $301,513 269,672
Cost and Expenses:
Cost of sales 184,842 162,071
SG&A 77,519 70,986
Amortization of intangible assets 9,587 7,933
Interest expense 4,374 4,529
Other expenses (income), net 244 (350)
------- --------
Total costs and expenses 276,566 245,169
------- -------
Earnings before income taxes 24,947 24,503
Income taxes 8,502 9,208
----- -----
Net earnings from continuing operations 16,445 15,295
Loss from discontinued operations, net of tax
of $112 and $1,125, respectively (197) (1,423)
Loss on sale from discontinued operations, net
of tax of $905 and $4,809, respectively (32) (4,974)
--- ------
Net earnings from discontinued operations (229) (6,397)
Net earnings $ 16,216 $ 8,898
======== ========
Earnings per share:
Basic
Continuing operations 0.63 0.59
Discontinued operations (0.01) (0.25)
----- -----
Net earnings $ 0.62 0.34
======== ====
Diluted
Continuing operations 0.62 0.58
Discontinued operations (0.01) (0.24)
----- -----
Net earnings $ 0.61 0.34
======== ====
Average common shares O/S:
Basic 26,143 25,803
====== ======
Diluted 26,444 26,227
====== ======
- more -
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Business Segment Information
(Unaudited)
(Dollars in thousands)
Three Months Ended Six Months Ended
March 31, March 31,
2009 2008 2009 2008
---- ---- ---- ----
Net Sales
- ---------
Utility Solutions
Group $ 94,065 73,812 182,266 153,436
Test 33,713 33,496 69,202 65,561
Filtration 26,378 27,092 50,045 50,675
------ ------ ------ ------
Totals $154,156 134,400 301,513 269,672
======== ======= ======= =======
EBIT
- ----
Utility Solutions
Group $ 16,138 11,222 26,693 25,965
Test 3,748 2,742 6,982 4,732
Filtration 4,227 4,913 7,090 8,562
Corporate (5,762) (1) (5,232) (2) (11,444) (3) (10,227) (4)
------ -- ------ -- ------- -- -------
Consolidated EBIT 18,351 13,645 29,321 29,032
Less: Interest
expense (1,756) (3,172) (4,374) (4,529)
------ ------ ------ ------
Earnings before
income taxes $ 16,595 10,473 24,947 24,503
======== ====== ====== ======
Note: Depreciation and amortization expense was $7.2 million and $6.9
million for the quarters ended March 31, 2009 and 2008,
respectively, and $15.1 million and $12.4 million for the six-month
periods ended March 31, 2009 and 2008, respectively.
(1) Includes $1.2 million of amortization of acquired intangible assets.
(2) Includes $1.1 million of amortization of acquired intangible assets.
(3) Includes $2.4 million of amortization of acquired intangible assets.
(4) Includes $1.9 million of amortization of acquired intangible assets.
- more -
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Financial Measures
(unaudited)
EPS - Adjusted Basis Reconciliation - FY 2009
- ---------------------------------------------
EPS - GAAP Basis - FY 2009 Range $1.90 2.00
Adjustments (defined below) 0.42 0.42
---- ----
EPS - Adjusted Basis - FY 2009 Range $2.32 2.42
===== ====
Adjustments exclude pre-tax intangible asset amortization expense
related to TWACS NG software, purchase accounting intangible amortization
related to the Company's acquisitions within the last three years, and the
expense related to the purchase accounting step-up of Doble Engineering
Company inventory.
- more -
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
(Dollars in thousands)
March 31, September 30,
2009 2008
---- ----
Assets
- ------
Cash and cash equivalents $ 26,600 28,667
Accounts receivable, net 121,156 134,710
Costs and estimated earnings on
long-term contracts 4,239 9,095
Inventories 81,868 65,019
Current portion of deferred tax assets 14,540 15,368
Other current assets 17,215 14,888
Current assets from discontinued operations - 2,889
------- -------
Total current assets 265,618 270,636
Property, plant and equipment, net 69,774 72,353
Goodwill 329,659 328,878
Intangible assets, net 227,690 236,192
Other assets 17,565 17,665
Other assets from discontinued operations - 2,349
------- -------
$910,306 928,073
======== =======
Liabilities and Shareholders' Equity
- ------------------------------------
Short-term borrowings and current maturities
of long-term debt $ 50,000 50,000
Accounts payable 43,768 48,982
Current portion of deferred revenue 18,386 18,226
Other current liabilities 44,531 49,934
Current liabilities from discontinued
operations - 1,541
------- -----
Total current liabilities 156,685 168,683
Long-term portion of deferred revenue 2,087 2,228
Deferred tax liabilities 83,167 83,515
Other liabilities 20,242 21,760
Long-term debt 165,504 183,650
Shareholders' equity 482,621 468,237
------- -------
$910,306 928,073
======== =======
- more -
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
Six Months Ended
March 31, 2009
--------------
Cash flows from operating activities:
Net earnings $ 16,216
Adjustments to reconcile net earnings
to net cash provided by operating activities:
Net loss from discontinued operations 229
Depreciation and amortization 15,108
Stock compensation expense 2,097
Changes in operating working capital (11,413)
Effect of deferred taxes (1,074)
Other (1,242)
------
Net cash provided by operating activities -
continuing operations 19,921
Net loss from discontinued operations,
net of tax (229)
Net cash provided by discontinued operations 39
------
Net cash used by operating activities -
discontinued operations (190)
------
Net cash provided by operating activities 19,731
======
Cash flows from investing activities:
Additions to capitalized software (2,487)
Capital expenditures - continuing operations (3,116)
------
Net cash used by investing activities -
continuing operations (5,603)
Proceeds from divestiture of business, net -
discontinued operations 3,100
-----
Net cash used by investing activities (2,503)
------
Cash flows from financing activities:
Proceeds from long-term debt 27,000
Principal payments on long-term debt (45,146)
Excess tax benefit from stock options exercised 782
Proceeds from exercise of stock options 1,164
Other (190)
------
Net cash used by financing activities (16,390)
-------
Effect of exchange rate changes on cash and cash equivalents (2,905)
------
Net decrease in cash and cash equivalents (2,067)
Cash and cash equivalents, beginning of period 28,667
------
Cash and cash equivalents, end of period $ 26,600
========
- more -
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Other Selected Financial Data
(Unaudited)
(Dollars in thousands)
Backlog And Entered
Orders - Q2 FY 2009 Utility Solutions Test Filtration Total
------------------- ----------------- ---- ---------- -----
Beginning Backlog -
12/31/08 continuing
opers $121,554 64,236 72,506 258,296
Entered Orders 97,247 26,024 33,413 156,684
Sales (94,065) (33,713) (26,378) (154,156)
------- ------- ------- --------
Ending Backlog -
3/31/09 $124,736 56,547 79,541 260,824
======== ====== ====== =======
Backlog And Entered
Orders - YTD Q2
FY 2009 Utility Solutions Test Filtration Total
------- ----------------- ---- ---------- -----
Beginning Backlog -
9/30/08 continuing
opers $124,847 69,823 71,463 266,133
Entered Orders 182,155 55,926 58,123 296,204
Sales (182,266) (69,202) (50,045) (301,513)
-------- ------- ------- --------
Ending Backlog -
3/31/09 $124,736 56,547 79,541 260,824
======== ====== ====== =======
# # #