October 27, 2011 at 10:18 AM EDT
Gorman-Rupp Reports Record Backlog and Record Third Quarter and Nine Months 2011 Revenue and Earnings

The Gorman-Rupp Company (NYSE Amex: GRC) reports net sales and earnings for the third quarter and nine months ended September 30, 2011. Results for 2011 include the operations of National Pump Company acquired October 1, 2010.

Net sales during the quarter ended September 30, 2011 increased 22.0% to a third quarter record $90,215,000 compared to $73,953,000 during the same period in 2010. Net income increased 24.4% to a third quarter record $7,655,000 compared to $6,155,000 in the September 30, 2010 quarter. Earnings per share were $0.37 and $0.29 for the respective periods, an increase of 27.6%.

Net sales for the nine months ended September 30, 2011 increased 25.6% to a nine months record $266,448,000 compared to $212,119,000 during the same period in 2010. Net income increased 45.3% to a nine months record $23,699,000 compared to $16,308,000 in the first nine months of 2010. Earnings per share were $1.13 and $0.78 for the respective periods.

Sales during the quarter were positively impacted by the global economy compared to a year ago, plus the addition of National Pump Company. Primary increases were in sales to the industrial, agricultural and construction markets, partially offset by a reduction in fire protection market sales from strong levels last year.

Incoming orders resulted in a record backlog of $157.9 million at September 30, 2011, a 50.9% increase from a year ago and 47.0% higher than the backlog of $107.4 million at December 31, 2010. Current quarter orders included additional flood control pump projects which generally require longer lead times than other Company products.

The comparative increases in earnings for the quarter and nine months principally reflect operating leverage benefits from the higher volume of sales and continuation of a favorable mix of shipments across the Company’s diverse products and markets.

The Company continues to maintain a strong and liquid balance sheet with $27.8 million in cash and short-term investments. Additionally, working capital increased 17.7% from December 31, 2010 to $98.3 million at September 30, 2011. During the quarter, an additional $5.0 million of borrowings used to finance the acquisition of National Pump Company were re-paid.

Jeffrey S. Gorman, President and CEO said, “We are pleased to again announce strong financial results based on current year sales increases across most of the markets the Company serves and related improved operating margins. Additionally, our National Pump Company acquisition in late 2010 continues to perform very well. While confidence in the strength of a solid global economic recovery seems to be fading, we are encouraged by our record backlog and level of business so far this year, and we remain confident as we move into the fourth quarter and the first-half of 2012.”

The Gorman-Rupp Company and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(in thousands of dollars, except per share data)
Three Months Ended September 30, Nine Months Ended September 30,
2011 2010 2011 2010
Net sales $ 90,215 $ 73,953 $ 266,448 $ 212,119
Cost of products sold 67,748 55,298 198,346 160,729
Gross profit 22,467 18,655 68,102 51,390

Selling, general and administrative expenses

10,941 9,401 32,436 26,535
Operating income 11,526 9,254 35,666 24,855
Other income (expense) - net (324 ) 3 (421 ) (388 )
Income before income taxes 11,202 9,257 35,245 24,467
Income taxes 3,547 3,102 11,546 8,159
Net income $ 7,655 $ 6,155 $ 23,699 $ 16,308
Earnings per share $ 0.37 $ 0.29 $ 1.13 $ 0.78
The Gorman-Rupp Company and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands of dollars)
September 30, December 31,
2011 2010
Assets
Cash and short-term investments $ 27,774 $ 34,246
Accounts receivable - net 54,841 51,996
Inventories 72,003 51,449
Deferred income taxes and other current assets 4,424 5,503
Total current assets 159,042 143,194
Property, plant and equipment - net 114,322 113,526
Prepaid pension and other assets 7,368 3,545
Goodwill and other intangible assets 25,717 26,442
Total assets $ 306,449 $ 286,707
Liabilities and shareholders' equity
Accounts payable $ 16,321 $ 12,042
Short-term debt 15,000 25,000
Accrued liabilities and expenses 29,419 22,636
Total current liabilities 60,740 59,678
Postretirement benefits 22,502 22,241
Deferred and other income taxes 4,952 4,954
Shareholders' equity 218,255 199,834
Total liabilities and shareholders' equity $ 306,449 $ 286,707
Shares outstanding 20,990,893 20,984,893

Shares outstanding and per share data reflect the 5 for 4 stock split effective June 10, 2011.

Contacts:

The Gorman-Rupp Company
David P. Emmens, Corporate Secretary, 419-755-1477
or
Wayne L. Knabel, Chief Financial Officer, 419-755-1397
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