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): March 20, 2003
ACTUANT CORPORATION
(Exact name of Registrant as specified in its charter)
Wisconsin 1-11288 39-0168610
(State or other jurisdiction (Commission File (I.R.S. Employer
of incorporation) Number) Identification No.)
6100 North Baker Road
Milwaukee, WI 53209
Mailing address: P.O. Box 3241, Milwaukee, Wisconsin 53201
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (414) 352-4160
Item 5. Other Events and Regulation FD Disclosure.
On March 19, 2003, the company announced its results of operations for the
second quarter of fiscal 2003 ending February 28, 2003. A copy of the press
release announcing the company's second quarter fiscal 2003 results is filed as
an exhibit to this report on Form 8-K and is incorporated herein by reference.
Item 7. Financial Statements and Exhibits
(c) Exhibits
Exhibit 99.1 Press Release dated March 19, 2003
announcing second quarter results
2
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.
ACTUANT CORPORATION
(Registrant)
Date: March 20, 2003 By: /s/ Andrew G. Lapereur
-----------------------------------
Andrew G. Lampereur
Vice President and Chief Financial Officer
(Duly authorized to sign on behalf of the
Registrant)
3
Exhibit 99.1
Actuant Reports 32% Year-Over-Year Increase in Second Quarter Diluted
EPS
MILWAUKEE, Wis.--(BUSINESS WIRE)--March 19, 2003--Actuant
Corporation (NYSE:ATU) today announced results for its second quarter
ended February 28, 2003. Second quarter sales increased approximately
31% to $142.1 million compared to $108.4 million in the prior year.
Current year results include those from Heinrich Kopp AG ("Kopp"),
which was acquired on September 3, 2002. Excluding Kopp and the impact
of foreign currency exchange rate changes on translated results,
second quarter sales increased approximately 2%. Second quarter fiscal
2003 net earnings and diluted earnings per share ("diluted EPS") were
$7.1 million and $0.58 per diluted share, respectively. This compares
favorably to net earnings of $4.0 million, or $0.44 per diluted share,
for the second quarter of fiscal 2002.
Sales for the six months ended February 28, 2003 were $290.0
million, approximately 31% higher than the $221.6 million in the
comparable prior year period. Excluding Kopp and the impact of foreign
currency rate changes on translated results, sales for the six-month
period increased 3%. Net earnings for the six-months ended February
28, 2003 were $9.0 million, or $0.73 per diluted share, compared to
$1.4 million, or $0.16 per diluted share for the comparable prior year
period. The Company recorded net of tax special charges of $1.3
million, or $0.10 per diluted share, in the first quarter of fiscal
2003 related to the early extinguishment of debt and $4.7 million, or
$0.39 per diluted share, related to litigation matters associated with
businesses divested prior to the spin-off of APW Ltd. in July 2000. In
addition, the Company adopted Statement of Financial Accounting
Standards No. 142, "Goodwill and Other Intangible Assets" at the
beginning of fiscal 2002, which resulted in a net cumulative effect of
accounting change charge of $7.2 million, or $0.81 per diluted share.
Excluding these special charges, fiscal 2003 first-half net earnings
and diluted EPS were $15.0 million and $1.22 per diluted share,
compared to $8.6 million and $0.97 per diluted share, respectively, in
the prior year.
Commenting on the results, Robert C. Arzbaecher, President and CEO
of Actuant, stated, "Overall we are pleased with second quarter
results. We favorably settled the patent infringement litigation in
our RV business, generated strong cash flow and made significant
progress with integration and restructuring activities at Kopp. Sales
grew 2%, excluding acquisitions and currency rate changes, and diluted
earnings per share increased 32% despite challenging economic
conditions. Actuant is positioned for additional future growth from
convertible top actuation as well as profit improvements at both Kopp
and our core businesses due to cost reduction activities. Excluding
special charges, diluted EPS has increased in each of the last seven
quarters.
"Economic conditions and customer demand in some of our markets
weakened as the second quarter progressed. To reduce the impact of
further economic deterioration, we will be taking actions in the third
and fourth quarters to reduce costs including headcount reductions and
facility closures. This is expected to result in pretax restructuring
provisions of $2-$3 million over the next six months, which will be
partially offset by an expected pretax currency gain of $1 million
upon the liquidation of a Mexican subsidiary. Despite the weakening
economy and the restructuring costs, we continue to believe that
forecasted results, excluding the special charges from the first
quarter, will be in the previously endorsed ranges of $545-$575
million of sales, $90-$95 million of EBITDA (earnings before interest,
taxes, depreciation, and amortization) and $2.75-$3.00 of diluted EPS.
However, given the restructuring costs and uncertainties in the Middle
East, it is likely we will be in the lower half of our full year EPS
range. We are expecting third quarter sales to be in the $140-$145
million range, and diluted EPS, excluding restructuring costs, of
approximately $0.77-$0.83. The effect on the Company of any armed
conflict involving the United States or any terrorist activity cannot
be predicted, but could be significant."
Fiscal 2003 second quarter sales in the Tools & Supplies segment
were $90.7 million, or approximately 45%, higher than last year's
$62.3 million due primarily to the Kopp acquisition and foreign
currency rate changes. Excluding Kopp and the impact of foreign
currency rate changes, Tools & Supplies segment revenues were
essentially unchanged. Current year second quarter sales in the
Engineered Solutions segment increased approximately 12% to $51.4
million, compared to $46.1 million in the previous year, on higher
demand in the heavy-duty truck cab-tilt and automotive convertible top
markets, and the favorable impact of foreign currency. Excluding
foreign currency rate changes, Engineered Solutions sales increased
4%.
Actuant's second quarter EBITDA was $20.6 million, or 7% higher
than the $19.2 million reported last year. As expected, EBITDA margins
declined due to the addition of Kopp, which currently generates lower
margins than other Actuant business units.
Total debt decreased approximately $14 million during the quarter
to $193.7 million at February 28, 2003. Due to the significant
reduction in average outstanding debt as compared to fiscal 2002 and
lower market interest rates, net financing costs declined 45% from
$9.8 million in the second quarter of last year to approximately $5.4
million for the current year second quarter.
Actuant, headquartered in Milwaukee, Wisconsin, is a diversified
industrial company with operations in more than 20 countries. The
Actuant businesses are leading companies in highly engineered position
and motion control systems and branded tools. Products are offered
under such established brand names as Enerpac, Gardner Bender, Kopp,
Milwaukee Cylinder, Nielsen Sessions, Power-Packer, and Power Gear.
Safe Harbor Statement
Certain of the above comments represent forward-looking statements
made pursuant to the provisions of the Private Securities Litigation
Reform Act of 1995. Management cautions that these projections are
based on current estimates of future performance and are highly
dependent upon a variety of factors, which could cause actual results
to differ from these estimates. Actuant's results are also subject to
general economic conditions, variation in demand from customers, the
impact on the economy of terrorist attacks and threats of war, the
length of the current recession in the Company's markets, continued
market acceptance of the Company's new product introductions, the
successful integration of business unit acquisitions and related
restructuring, operating margin risk due to competitive pricing and
operating efficiencies, supply chain risk, material and labor cost
increases, foreign currency fluctuations and interest rate risk. See
the Company's registration statements filed with the Securities and
Exchange Commission for further information regarding risk factors.
For further information on Actuant and its business units, visit
the company's website at www.actuant.com.
Actuant Corporation
Consolidated Balance Sheets
(Dollars in thousands)
February 28, August 31,
2003 2002
------------ ----------
ASSETS
Current assets
Cash and cash equivalents $ 1,927 $ 3,043
Accounts receivable, net 83,464 58,304
Inventories, net 67,893 54,898
Deferred income taxes 20,926 9,127
Other current assets 4,322 4,592
------------ -----------
Total Current Assets 178,532 129,964
Property, plant and equipment, net 60,117 36,828
Goodwill 101,354 101,361
Other intangible assets, net 19,790 18,466
Other long-term assets 9,611 7,992
------------ -----------
Total Assets $ 369,404 $ 294,611
============ ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Short-term borrowings $ 693 $ 2,993
Trade accounts payable 51,389 47,834
Accrued compensation and benefits 16,074 12,362
Income taxes payable 16,069 18,365
Current maturities of long-term debt 8,536 6,788
Other current liabilities 55,337 23,924
------------ -----------
Total Current Liabilities 148,098 112,266
Long-term debt, less current maturities 184,487 182,783
Deferred income taxes 7,455 4,409
Pension and postretirement benefit accruals 28,314 11,550
Other long-term liabilities 27,616 27,222
Minority interest in net equity of consolidated
affiliates 3,671 -
Shareholders' equity
Capital stock 2,338 2,319
Additional paid-in capital (521,968) (523,419)
Accumulated other comprehensive income (loss) (18,735) (21,675)
Stock held in trust (564) (511)
Deferred compensation liability 564 511
Retained earnings 508,128 499,156
------------ -----------
Total Shareholders' Deficit (30,237) (43,619)
------------ -----------
Total Liabilities and Shareholders' Equity $ 369,404 $ 294,611
============ ===========
Actuant Corporation
Consolidated Statements of Earnings
(In thousands except per share amounts)
Three Months Ended Six Months Ended
February 28, February 28,
------------------ ------------------
2003 2002 2003 2002
------------------ ------------------
Net Sales $142,099 $108,434 $289,957 $221,574
Cost of Products Sold 95,610 71,744 197,566 146,851
------------------ ------------------
Gross Profit 46,489 36,690 92,391 74,723
Selling, Administrative and
Engineering Expenses 29,867 21,059 56,954 40,986
Amortization of Intangible Assets 593 620 1,220 1,232
------------------ ------------------
Operating Profit 16,029 15,011 34,217 32,505
Net Financing Costs 5,443 9,808 11,105 19,697
Charge for Early Extinguishment
of Debt - - 1,974 -
Litigation Charge associated with
Divested Businesses - - 7,300 -
Other (Income) Expense, net (752) (1,101) (506) (741)
------------------ ------------------
Earnings from Continuing Operations
Before Income Taxes
and Minority Interest 11,338 6,304 14,344 13,549
Income Tax Expense 4,025 2,270 5,092 4,950
Minority Interest, net of Income
Taxes 197 - 280 -
------------------ ------------------
Earnings from Continuing
Operations 7,116 4,034 8,972 8,599
Cumulative Effect of Change In
Accounting Principle, net of
Income Taxes - - - (7,200)
------------------ ------------------
Net Earnings (Loss) $ 7,116 $ 4,034 $ 8,972 $ 1,399
================== ==================
Basic Earnings (Loss) per Share
Earnings from Continuing
Operations $ 0.61 $ 0.46 $ 0.77 $ 1.03
Cumulative Effect of Change
in Accounting Principle,
net of Income Taxes - - - (0.86)
------------------ ------------------
Total $ 0.61 $ 0.46 $ 0.77 $ 0.17
================== ==================
Diluted Earnings (Loss) per Share
Earnings from Continuing
Operations $ 0.58 $ 0.44 $ 0.73 $ 0.97
Cumulative Effect of Change
in Accounting Principle,
net of Income Taxes - - - (0.81)
------------------ ------------------
Total $ 0.58 $ 0.44 $ 0.73 $ 0.16
================== ==================
Weighted Average Common Shares
Outstanding (1)
Basic 11,641 8,723 11,629 8,370
Diluted 12,223 9,268 12,226 8,857
(1) The increase in weighted average number of shares outstanding for
the three and six months ended February 28, 2003 as compared to
the three and six months ended February 28, 2002, reflects the
impact of the February 13, 2002 equity offering.
ACTUANT CORPORATION
SUPPLEMENTAL UNAUDITED SEGMENT DATA
(US dollars, in thousands)
FISCAL 2002
-----------------------------------------------------
Q1 Q2 Q3 Q4 TOTAL
-----------------------------------------------------
SALES
TOOLS &
SUPPLIES
SEGMENT $ 64,067 $ 62,338 $ 65,746 $ 67,357 $ 259,508
ENGINEERED
SOLUTIONS
SEGMENT 49,073 46,096 54,263 54,010 203,442
-----------------------------------------------------
TOTAL
REPORTED
SALES $ 113,140 $ 108,434 $ 120,009 $ 121,367 $ 462,950
=====================================================
% SALES GROWTH
TOOLS &
SUPPLIES
SEGMENT
ENGINEERED
SOLUTIONS
SEGMENT
TOTAL
REPORTED
SALES
OPERATING
PROFIT
TOOLS &
SUPPLIES
SEGMENT $ 11,565 $ 11,030 $ 12,805 $ 11,997 $ 47,397
ENGINEERED
SOLUTIONS
SEGMENT 7,036 4,984 8,317 8,436 28,773
CORPORATE /
GENERAL (1,107) (1,003) (1,454) (1,474) (5,038)
-----------------------------------------------------
TOTAL
REPORTED
RESULTS $ 17,494 $ 15,011 $ 19,668 $ 18,959 $ 71,132
=====================================================
OPERATING
PROFIT %
TOOLS &
SUPPLIES
SEGMENT 18.1% 17.7% 19.5% 17.8% 18.3%
ENGINEERED
SOLUTIONS
SEGMENT 14.3% 10.8% 15.3% 15.6% 14.1%
TOTAL (INCL.
CORPORATE) 15.5% 13.8% 16.4% 15.6% 15.4%
EBITDA (1)(4)
TOOLS &
SUPPLIES
SEGMENT $ 13,271 $ 13,213 $ 14,574 $ 13,862 $ 54,920
ENGINEERED
SOLUTIONS
SEGMENT (2) 8,014 6,776 8,997 8,900 32,687
CORPORATE /
GENERAL (1,143) (798) (842) (471) (3,254)
-----------------------------------------------------
TOTAL
RECURRING
EBITDA 20,142 19,191 22,729 22,291 84,353
OTHER
ITEMS (3) - - - - -
-----------------------------------------------------
TOTAL $ 20,142 $ 19,191 $ 22,729 $ 22,291 $ 84,353
=====================================================
EBITDA %
TOOLS &
SUPPLIES
SEGMENT 20.7% 21.2% 22.2% 20.6% 21.2%
ENGINEERED
SOLUTIONS
SEGMENT 16.3% 14.7% 16.6% 16.5% 16.1%
TOTAL
RECURRING
(INCL.
CORPORATE) 17.8% 17.7% 18.9% 18.4% 18.2%
FISCAL 2003
-----------------------------------------------------
Q1 Q2 Q3 Q4 TOTAL
-----------------------------------------------------
SALES
TOOLS &
SUPPLIES
SEGMENT $ 92,014 $ 90,651 $ 182,665
ENGINEERED
SOLUTIONS
SEGMENT 55,844 51,448 107,292
-----------------------------------------------------
TOTAL
REPORTED
SALES $ 147,858 $ 142,099 $ - $ - $ 289,957
=====================================================
% SALES GROWTH
TOOLS &
SUPPLIES
SEGMENT 43.6% 45.4% 44.5%
ENGINEERED
SOLUTIONS
SEGMENT 13.8% 11.6% 12.7%
TOTAL
REPORTED
SALES 30.7% 31.0% 30.9%
OPERATING
PROFIT
TOOLS &
SUPPLIES
SEGMENT $ 12,818 $ 12,224 $ 25,042
ENGINEERED
SOLUTIONS
SEGMENT 6,616 5,760 12,376
CORPORATE /
GENERAL (1,246) (1,955) (3,201)
-----------------------------------------------------
TOTAL
REPORTED
RESULTS $ 18,188 $ 16,029 $ - $ - $ 34,217
=====================================================
OPERATING
PROFIT %
TOOLS &
SUPPLIES
SEGMENT 13.9% 13.5% 13.7%
ENGINEERED
SOLUTIONS
SEGMENT 11.8% 11.2% 11.5%
TOTAL (INCL.
CORPORATE) 12.3% 11.3% 11.8%
EBITDA (1)(4)
TOOLS &
SUPPLIES
SEGMENT $ 15,126 $ 14,454 $ 29,580
ENGINEERED
SOLUTIONS
SEGMENT (2) 7,666 7,501 15,167
CORPORATE /
GENERAL (1,161) (1,354) (2,515)
-----------------------------------------------------
TOTAL
RECURRING
EBITDA 21,631 20,601 - - 42,232
OTHER
ITEMS (3) (9,274) - - - (9,274)
-----------------------------------------------------
TOTAL $ 12,357 $ 20,601 $ - $ - $ 32,958
=====================================================
EBITDA %
TOOLS &
SUPPLIES
SEGMENT 16.4% 15.9% 16.2%
ENGINEERED
SOLUTIONS
SEGMENT 13.7% 14.6% 14.1%
TOTAL
RECURRING
(INCL.
CORPORATE) 14.6% 14.5% 14.6%
(1) Fiscal 2002 EBITDA excludes discontinued operations, extraordinary
items, and cumulative effect of change in accounting principle.
(2) Second quarter 2002 EBITDA includes a gain on insurance recoveries
in excess of cost on a replacement value policy of $0.6 million.
(3) In fiscal 2003 other EBITDA includes a $2.0 million charge related
to the early redemption of senior subordinated notes and a $7.3
million charge related to business units divested prior to the
July 31, 2000 spin-off.
(4) EBITDA includes minority interests in net earnings of consolidated
subsidiaries.
CONTACT: Actuant Corporation
Andrew Lampereur, 414/352-4160