UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

———————————

FORM 10-Q

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(Mark One)



x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 31, ~~2012~~2013



¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File No. 1-11288

————————————

ACTUANT CORPORATION

(Exact name of registrant as specified in its charter)

————————————



Wisconsin		39-0168610
(State of incorporation)		(I.R.S. Employer Id. No.)

N86 W12500 WESTBROOK CROSSING

MENOMONEE FALLS, WISCONSIN 53051

Mailing address: P. O. Box 3241, Milwaukee, Wisconsin 53201

(Address of principal executive offices)

(262) 293-1500

(Registrant’s telephone number, including area code)

————————————

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate ~~website,~~Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated ~~filer”,~~filer,” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.): Yes ¨ No x

The number of shares outstanding of the registrant’s Class A Common Stock as of June 30, ~~2012~~2013 was ~~72,850,365.~~

~~TABLE OF CONTENTS~~73,256,926



		~~Page No.~~

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TABLE OF CONTENTS

~~Part I—Financial Information~~

	Page No.

Part I—Financial Information

Item 1—Condensed Consolidated Financial Statements (Unaudited)


Condensed Consolidated Statements of ~~Earnings~~Operations	4
	4
Condensed Consolidated Statements of Comprehensive Income (Loss)	5

Condensed Consolidated Balance Sheets	6
	5

Condensed Consolidated Statements of Cash Flows	7
	6

Notes to Condensed Consolidated Financial Statements	8
	7

Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
	21

Item 3—Quantitative and Qualitative Disclosures about Market Risk	33
	25

Item 4—Controls and Procedures	33
	26

Part II—Other Information

Item 1A—Risk Factors	35

Item ~~2 –~~ 2—Unregistered Sales of Equity Securities and Use of Proceeds	35
	26
Item 5—Other Information	35
~~Item 6 – Exhibits~~
26 Item 6—Exhibits	35

FORWARD LOOKING STATEMENTS AND CAUTIONARY FACTORS

This quarterly report on Form 10-Q contains certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such forward-looking statements include statements regarding expected financial results and other planned events, including, but not limited to, anticipated liquidity, and capital expenditures. Words such as “may,” “should,” “could,” “anticipate,” “believe,” “estimate,” “expect,” “plan,” “project” and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual future events or results may differ materially from these statements. We disclaim any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason.

The following is a list of factors, among others, that could cause actual results to differ materially from the forward-looking statements:

~~the timing~~economic uncertainty or ~~strength of~~ a ~~worldwide~~prolonged economic ~~recovery;~~

downturn;

the realization of anticipated cost savings from restructuring activities and cost reduction efforts;

market conditions in the truck, automotive, ~~specialty vehicle, agriculture,~~agricultural, industrial, production automation, oil & gas, energy, maintenance, power generation ~~marine, solar,~~and infrastructure ~~residential and commercial construction and retail Do-It Yourself (“DIY”)~~ industries;

increased competition in the markets we serve and market acceptance of existing and new products;

our ability to successfully identify and integrate acquisitions and realize anticipated benefits/results from acquired companies;

operating margin risk due to competitive product pricing, operating efficiencies, reduced production levels and material, labor and overhead cost increases;

foreign currency, interest rate and commodity risk;

supply chain and industry trends, including changes in purchasing and other business practices by customers;

regulatory and legal developments including changes to United States taxation rules, health care reform and governmental climate change initiatives;

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the potential for a non-cash asset impairment charge, if operating performance at one or more of our businesses were to fall significantly below current levels;

our level of indebtedness, ability to comply with the financial and other covenants in our debt agreements and current credit market conditions.

When used herein, the terms “Actuant,” “we,” “us,” “our” and the “Company” refer to Actuant Corporation and its subsidiaries. Our Form 10-K for the fiscal year ended August 31, ~~2011~~2012 contains an expanded description of these and other risks that may affect our business, financial position and results of operations under the section entitled “Risk Factors.”

~~When used herein, the terms “Actuant,” “we,” “us,” “our” and the “Company” refer to Actuant Corporation and its subsidiaries.~~

Actuant Corporation provides free-of-charge access to its Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments thereto, through its website, www.actuant.com, as soon as reasonably practical after such reports are electronically filed with the Securities and Exchange Commission.

3
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PART ~~I –~~ I—FINANCIAL INFORMATION

Item ~~1 –~~ 1—Financial Statements

ACTUANT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF ~~EARNINGS~~

OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

   Three Months Ended May 31, Nine Months Ended May 31,
   2012    2011 2012    2011
Net sales
   $ 429,215       $ 392,777    $ 1,200,038       $ 1,041,887
Cost of products sold
   263,095       238,739    740,018       640,969






Gross profit
   166,120       154,038    460,020       400,918
Selling, administrative and engineering expenses
   91,063       89,166    263,935       244,453
Amortization of intangible assets
   7,393       6,871    21,684       19,846






Operating profit
   67,664       58,001    174,401       136,619
Financing costs, net
   7,236       7,850    23,279       23,640
Debt refinancing charges
   16,830       —      16,830       —
Other expense, net
   2,604       331    3,090       1,276






Earnings from continuing operations before income taxes
   40,994       49,820    131,202       111,703
Income tax expense
   6,593       11,460    27,452       24,540






Earnings from continuing operations
   34,401       38,360    103,750       87,163
Loss from discontinued operations, net of income taxes
   —         (2,002 ) —         (16,986 )






Net earnings
   $ 34,401       $ 36,358    $ 103,750       $ 70,177






Earnings from continuing operations per share:

Basic
   $ 0.48       $ 0.56    $ 1.50       $ 1.28
Diluted
   $ 0.45       $ 0.51    $ 1.39       $ 1.17
Earnings per share:

Basic
   $ 0.48       $ 0.53    $ 1.50       $ 1.03
Diluted
   $ 0.45       $ 0.49    $ 1.39       $ 0.95
Weighted average common shares outstanding:

Basic
   71,083       68,354    69,184       68,208
Diluted
   75,371       75,571    75,201       75,314



	Three Months Ended					Nine Months Ended
	May 31, 2013			May 31, 2012		May 31, 2013			May 31, 2012
Net sales	$	344,205		$	343,268	$	952,482		$	954,153
Cost of products sold	207,301			204,514		575,032			572,301
Gross profit	136,904			138,754		377,450			381,852
Selling, administrative and engineering expenses	74,323			74,341		222,521			210,806
Amortization of intangible assets	5,539			5,563		17,542			16,237
Operating profit	57,042			58,850		137,387			154,809
Financing costs, net	6,229			7,236		18,811			23,280
Debt refinancing costs	—			16,830		—			16,830
Other expense, net	911			2,591		1,518			3,297
Earnings from continuing operations before income tax expense	49,902			32,193		117,058			111,402
Income tax expense	3,825			4,456		14,596			22,042
Earnings from continuing operations	46,077			27,737		102,462			89,360
Earnings (loss) from discontinued operations, net of income taxes	(139,060		)	6,664		(130,667		)	14,390
Net earnings (loss)	$	(92,983	)	$	34,401	$	(28,205	)	$	103,750

Earnings from continuing operations per share:
Basic	$	0.63		$	0.39	$	1.40		$	1.29
Diluted	$	0.62		$	0.36	$	1.38		$	1.19

Earnings (loss) per share:
Basic	$	(1.27	)	$	0.48	$	(0.39	)	$	1.50
Diluted	$	(1.24	)	$	0.45	$	(0.38	)	$	1.39

Weighted average common shares outstanding:
Basic	73,133			71,083		72,957			69,184
Diluted	74,787			75,371		74,491			75,201

See accompanying Notes to Condensed Consolidated Financial Statements

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ACTUANT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands)

(Unaudited)

Three Months Ended
Nine Months Ended
May 31,
2013 May 31,
2012 May 31,
2013 May 31,
2012
Net earnings (loss) $ (92,983 ) $ 34,401
$ (28,205 ) $ 103,750
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments (5,570 ) (36,450 ) (5,426 ) (65,038 )

Pension and other postretirement benefit plans
Actuarial loss arising during period —
—
125
—
Funded status deferred tax adjustment 341
—
341
—
Amortization of actuarial losses included in net periodic pension cost 90
50
270
133
Total pension and other postretirement benefit plans 431
50
736
133

Cash flow hedges
Unrealized net gain (loss) arising during period 109
(141 ) (5 ) (260 )
Net loss (gain) reclassified into earnings 62
3,033
(69 ) 3,033
Total cash flow hedges 171
2,892
(74 ) 2,773
Total other comprehensive loss, net of tax (4,968 ) (33,508 ) (4,764 ) (62,132 )
Comprehensive income (loss) $ (97,951 ) $ 893
$ (32,969 ) $ 41,618

See accompanying Notes to Condensed Consolidated Financial Statements

5
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ACTUANT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

(Unaudited)



	May 31, 2013			August 31, 2012
ASSETS
Current assets
Cash and cash equivalents	$	161,418		$	68,184
Accounts receivable, net	214,683			234,756
Inventories, net	145,226			211,690
Deferred income taxes	22,503			22,583
Other current assets	26,396			24,068
Current assets of discontinued operations	264,058			—
Total current assets	834,284			561,281
Property, plant and equipment
Land, buildings and improvements	50,864			49,866
Machinery and equipment	219,507			242,718
Gross property, plant and equipment	270,371			292,584
Less: Accumulated depreciation	(165,768		)	(176,700		)
Property, plant and equipment, net	104,603			115,884
Goodwill	647,150			866,412
Other intangibles, net	316,986			445,884
Other long-term assets	16,451			17,658
Total assets	$	1,919,474		$	2,007,119
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Trade accounts payable	$	147,898		$	174,746
Accrued compensation and benefits	42,055			58,817
Current maturities of long-term debt	10,000			7,500
Income taxes payable	9,350			5,778
Other current liabilities	51,957			72,165
Current liabilities of discontinued operations	52,283			—
Total current liabilities	313,543			319,006
Long-term debt, less current maturities	382,500			390,000
Deferred income taxes	97,745			132,653
Pension and postretirement benefit liabilities	25,567			26,442
Other long-term liabilities	68,281			87,182
Shareholders’ equity
Class A common stock, $0.20 par value per share, authorized 168,000,000 shares, issued 76,441,680 and 75,519,079 shares, respectively	15,287			15,102
Additional paid-in capital	34,176			7,725
Treasury stock, at cost, 3,141,394 and 2,658,751 shares, respectively	(76,753		)	(63,083		)
Retained earnings	1,133,364			1,161,564
Accumulated other comprehensive loss	(74,236		)	(69,472		)
Stock held in trust	(3,094		)	(2,689		)
Deferred compensation liability	3,094			2,689
Total shareholders’ equity	1,031,838			1,051,836
Total liabilities and shareholders’ equity	$	1,919,474		$	2,007,119

~~(unaudited)~~

   May 31, August 31,
   2012 2011
ASSETS

Current assets

Cash and cash equivalents
   $ 80,149    $ 44,221
Accounts receivable, net
   237,438    223,760
Inventories, net
   206,389    223,235
Deferred income taxes
   32,206    32,461
Other current assets
   19,109    22,807


Total current assets
   575,291    546,484
Property, plant and equipment

Land, buildings and improvements
   50,873    51,901
Machinery and equipment
   254,083    263,250


Gross property, plant and equipment
   304,956    315,151
Less: Accumulated depreciation
   (188,991 ) (186,502 )


Property, plant and equipment, net
   115,965    128,649
Goodwill
   873,682    888,466
Other intangibles, net
   454,360    479,406
Other long-term assets
   14,811    13,676


Total assets
   $ 2,034,109    $ 2,056,681


LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities

Trade accounts payable
   $ 167,632    $ 170,084
Accrued compensation and benefits
   53,008    71,639
Short-term borrowings and current maturities of debt
   6,250    2,690
Income taxes payable
   30,289    19,342
Other current liabilities
   68,583    66,548


Total current liabilities
   325,762    330,303
Long-term debt
   392,500    522,727
Deferred income taxes
   133,619    165,945
Pension and postretirement benefit liabilities
   18,171    18,864
Other long-term liabilities
   86,772    99,829
Shareholders’ equity

Class A common stock, $0.20 par value per share, authorized 168,000,000, issued 75,274,829 and 68,657,234 shares, respectively
   15,054    13,731
Additional paid-in capital
   382    (154,231 )
Treasury stock, at cost, 1,732,245 shares
   (39,282 ) —
Retained earnings
   1,180,942    1,077,192
Accumulated other comprehensive loss
   (79,811 ) (17,679 )
Stock held in trust
   (2,661 ) (2,137 )
Deferred compensation liability
   2,661    2,137


Total shareholders’ equity
   1,077,285    919,013


Total liabilities and shareholders’ equity
   $ 2,034,109    $ 2,056,681

See accompanying Notes to Condensed Consolidated Financial Statements

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ACTUANT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

   Nine Months Ended May 31,
   2012 2011
Operating Activities

Net earnings
   $ 103,750    $ 70,177
Adjustments to reconcile net earnings to cash provided by operating activities:

Depreciation and amortization
   40,192    38,143
Net loss on disposal of business
   —      15,744
Stock-based compensation expense
   10,002    8,093
Benefit for deferred income taxes
   (2,137 ) (2,298 )
Amortization of debt discount and debt issuance costs
   1,492    2,409
Non-cash debt refinancing charge
   2,254    —
Other non-cash adjustments
   (138 ) (18 )
Changes in components of working capital and other:

Accounts receivable
   (21,692 ) (27,752 )
Inventories
   9,171    (39,533 )
Prepaid expenses and other assets
   1,071    5,989
Trade accounts payable
   2,779    18,400
Income taxes payable
   (2,056 ) 6,904
Accrued compensation and benefits
   (8,766 ) 646
Other liabilities
   (6,608 ) (1,806 )


Net cash provided by operating activities
   129,314    95,098
Investing Activities

Proceeds from sale of property, plant and equipment
   8,486    359
Proceeds from sale of business, net of transaction costs
   —      3,463
Capital expenditures
   (17,491 ) (14,843 )
Business acquisitions, net of cash acquired
   (29,734 ) (160,047 )


Net cash used in investing activities
   (38,739 ) (171,068 )
Financing Activities

Net (repayments) borrowings on revolving credit facilities
   (58,167 ) 14
Issuance of term loan
   —      100,000
Principal repayments on term loan
   (1,250 ) —
Repurchases of 2% Convertible Notes
   (102 ) (34 )
Proceeds from 5.625% Senior Note issuance
   300,000    —
Redemption of 6.875% Senior Notes
   (250,000 ) —
Debt issuance costs
   (5,340 ) (5,197 )
Purchase of treasury shares
   (39,282 ) —
Stock option exercises and related tax benefits
   6,392    7,285
Cash dividend
   (2,748 ) (2,716 )


Net cash provided by (used in) financing activities
   (50,497 ) 99,352
Effect of exchange rate changes on cash
   (4,150 ) 4,695


Net increase in cash and cash equivalents
   35,928    28,077
Cash and cash equivalents—beginning of period
   44,221    40,222


Cash and cash equivalents—end of period
   $ 80,149    $ 68,299



	Nine Months Ended
	May 31, 2013			May 31, 2012
Operating Activities
Net earnings (loss)	$	(28,205	)	$	103,750
Adjustments to reconcile net earnings (loss) to cash provided by operating activities:
Depreciation and amortization	42,790			40,192
Impairment charge	170,052			—
Benefit for deferred income taxes	(30,549		)	(2,137		)
Stock-based compensation expense	10,507			10,002
Amortization of debt discount and debt issuance costs	1,488			1,492
Non-cash debt refinancing charge	—			2,254
Other non-cash adjustments	171			(138		)
Sources (uses) of cash from changes in components of working capital and other:
Accounts receivable	(25,033		)	(21,692		)
Inventories	7,326			9,171
Prepaid expenses and other assets	(4,613		)	1,071
Trade accounts payable	(7,529		)	2,779
Income taxes payable	(5,538		)	(2,056		)
Accrued compensation and benefits	(12,829		)	(8,766		)
Other accrued liabilities	(1,768		)	(6,608		)
Net cash provided by operating activities	116,270			129,314
Investing Activities
Proceeds from sale of property, plant and equipment	1,317			8,486
Proceeds from sale of business	4,854			—
Capital expenditures	(18,895		)	(17,491		)
Business acquisitions, net of cash acquired	—			(28,776		)
Net cash used in investing activities	(12,724		)	(37,781		)
Financing Activities
Net changes in borrowings on revolver and other debt	—			(58,167		)
Principal repayments on term loan	(5,000		)	(1,250		)
Repurchases of 2% Convertible Notes	—			(102		)
Proceeds from 5.625% Senior Note issuance	—			300,000
Redemption of 6.875% Senior Notes	—			(250,000		)
Debt issuance costs	—			(5,340		)
Purchase of treasury shares	(13,670		)	(39,282		)
Stock option exercises and related tax benefits	18,705			6,392
Payment of contingent consideration	(3,635		)	(958		)
Cash dividend	(2,911		)	(2,748		)
Net cash used in financing activities	(6,511		)	(51,455		)
Effect of exchange rate changes on cash	(3,801		)	(4,150		)
Net increase in cash and cash equivalents	93,234			35,928
Cash and cash equivalents – beginning of period	68,184			44,221
Cash and cash equivalents – end of period	$	161,418		$	80,149

See accompanying Notes to Condensed Consolidated Financial Statements

7
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~(In thousands, except share and per share amounts)~~

Note 1. Basis of Presentation

~~Consolidation and Presentation~~

The accompanying unaudited condensed consolidated financial statements of Actuant Corporation (“Actuant,” or the “Company”) have been prepared in accordance with generally accepted accounting principles for interim financial reporting and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The condensed consolidated balance sheet data as of August 31, ~~2011~~2012 was derived from the Company’s audited financial statements, but does not include all disclosures required by generally accepted accounting principles. For additional information, including the Company’s significant accounting policies, refer to the consolidated financial statements and related footnotes in the Company’s fiscal ~~2011~~2012 Annual Report on Form 10-K.

In the opinion of management, all adjustments considered necessary for a fair ~~presentation~~statement of financial results have been made. Such adjustments consist of only those of a normal recurring nature. Operating results for the three and nine months ended May 31, ~~2012~~2013 are not necessarily indicative of the results that may be expected for the entire fiscal year ending August 31, ~~2012.~~

2013~~New Accounting Pronouncements~~

~~In June 2011, the Financial Accounting Standards Board (FASB) updated the disclosure requirements for comprehensive income. The updated guidance requires companies~~. Certain prior year amounts have been reclassified to disclose the total of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The updated guidance does not affect how earnings per share is calculated or presented. The amended guidance, which must be applied retroactively, is effective for fiscal years, and interim periods within those years, beginning after December 15, 2011, with earlier adoption permitted.

~~In September 2011, the FASB issued an amendment~~conform to existing guidance on the testing of goodwill for impairment. Under the revised guidance, entities testing goodwill for impairment have the option of performing a qualitative assessment before calculating the fair value of the reporting unit. If entities determine, on the basis of qualitative factors, that the fair value of the reporting unit is more likely than not less than the carrying amount, the two-step impairment test would be required. The amendment is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011, with earlier adoption permitted.

current year presentation, including amounts related to discontinued operations.

Note 2. Acquisitions

The Company ~~continually evaluates potential~~incurred acquisition transaction costs of $0.2 million and $1.0 million for the nine months ended May 31, 2013 and May 31, 2012, respectively, related to various business acquisition activities. During fiscal 2013, the Company also paid $3.6 million of deferred purchase price consideration for acquisitions ~~that are a strategic fit with~~completed in previous periods. The Company completed three business acquisitions during fiscal 2012. All of the ~~Company’s existing businesses or expand the Company’s portfolio into new and attractive end markets. These~~ acquisitions ~~result~~resulted in the recognition of goodwill in the Company’s consolidated financial statements because the purchase prices reflect the future earnings and cash flow potential of ~~the acquired~~these companies, as well as the complementary strategic fit and resulting synergies these businesses are expected to bring to existing operations.

On March 28, 2012 the Company acquired the stock of Turotest Medidores Ltda (“Turotest”) for $8.1 million of cash and deferred consideration of $5.3 million. Turotest, an Engineered Solutions segment acquisition, headquartered in San Paulo, Brazil designs and manufactures instrument panels and gauges serving the Brazilian agriculture and industrial markets. The acquisition resulted in the recognition of $5.5 million of goodwill (which is not deductible for tax purposes) and $7.0 million of intangible assets (customer relationships, tradename and non-compete).

On February 10, 2012 the Company completed the acquisition of the stock of Jeyco Pty Ltd (“Jeyco”) for $20.7 million of cash. Jeyco, an Energy segment acquisition, headquartered near Perth, Australia, designs and provides specialized mooring, rigging and towing systems and services to the offshore oil & gas industry in Australia and other international markets. Additionally, Jeyco’s products are used in a variety of applications for other markets including cyclone mooring and marine, defense and mining tow systems. The purchase price allocation resulted in the recognition of $14.1 million of goodwill (which is not deductible for tax purposes) and $5.5 million of intangible assets (tradename, non-compete and customer relationships).

The Company completed two business acquisitions during fiscal 2011. On June 2, 2011, the Company completed the acquisition of Weasler Engineering, Inc. (“Weasler”) for $153.2 million of cash. Weasler, which is headquartered in Wisconsin, is a global designer and manufacturer of highly engineered drive train components and systems for agriculture, lawn & turf and industrial equipment. Weasler also supplies a variety of torque limiters, high-end gear boxes, clutches and torsional dampers which expand the product offering of the Engineered Solutions segment. On December 10, 2010, the Company completed the acquisition of Mastervolt International Holding B.V. (“Mastervolt”) for $158.2 million of cash. Mastervolt, headquartered in The Netherlands, is a designer, developer and global supplier of highly innovative, branded power electronics, primarily for the European solar and marine markets. Mastervolt expands the Electrical segment’s geographic presence and product offerings to include additional technologies associated with the efficient conversion, control, storage and conditioning of electrical power. The purchase price allocations for these fiscal 2011 acquisitions resulted in the recognition of $152.4 million of goodwill (which is not deductible for tax purposes) and $157.5 million of intangible assets, including $81.5 million of customer relationships, $69.9 million of tradenames, $5.5 million of patents and technologies and $0.6 million of non-compete agreements.

The Company makes an initial allocation of the purchase price at the date of acquisition, based upon its understanding of the fair value of the acquired assets and assumed liabilities. The Company obtains this information during due diligence and through other sources. If additional information is obtained about these assets and liabilities within the measurement period (not to exceed one year from the date of acquisition), including through asset appraisals and learning more about the newly acquired business, the Company will refine its estimates of fair value.

During fiscal 2012, the ~~nine months ended May 31,~~Company completed two Maximatecc tuck-in acquisitions that further expand the geographic presence, product offerings and technologies of the Engineered Solutions segment. On July 20, 2012 ~~goodwill was reduced by $3.3~~, the Company completed the acquisition of the stock of CrossControl AB (“CrossControl”) for $40.6 million of cash, plus potential contingent consideration. CrossControl, headquartered in Sweden, provides advanced electronic solutions and displays for user-machine interaction, vehicle control and mobile connectivity in critical environments. On March 28, 2012 the ~~net result~~Company acquired the stock of Turotest Medidores Ltda (“Turotest”) for $8.1 million of cash and $5.3 million of deferred purchase ~~accounting adjustments~~price. Turotest, headquartered in Brazil, designs and manufactures instrument panels and gauges for the Brazilian agriculture and industrial markets. In addition, on February 10, 2012, the Company completed the acquisition of the stock of Jeyco Pty Ltd (“Jeyco”) for $20.7 million of cash. This Cortland (Energy segment) tuck-in acquisition, designs and provides specialized mooring, rigging and towing systems and services to the ~~fair value~~offshore oil & gas industry in Australia and other international markets. Additionally, Jeyco’s products are used in a variety of ~~acquired~~applications for other markets including cyclone mooring and marine, defense and mining tow systems.

The purchase price allocation for fiscal 2012 acquisitions resulted in the recognition of $40.8 million of goodwill (which is not deductible for tax purposes) and $32.8 million of intangible assets, including $24.2 million of customer relationships, $5.7 million of tradenames, $2.2 million of technologies and ~~assumed liabilities, including a $7.7~~$0.7 million ~~reduction to Mastervolt’s initial estimated warranty reserve.~~

of non-compete agreements.

The following unaudited pro forma results of operations of the Company for the three and nine months ended May 31, ~~2012~~2013 and May 31, ~~2011,~~2012, give effect to these acquisitions as though the transactions and related financing activities had occurred on September 1, ~~2010~~2011 (in thousands, except per share amounts):

   Three Months Ended May 31,    Nine Months Ended May 31,
   2012    2011    2012    2011
Net sales

As reported
   $ 429,215       $ 392,777       $ 1,200,038       $ 1,041,887
Pro forma
   430,356       427,159       1,219,104       1,178,722
Earnings from continuing operations

As reported
   $ 34,401       $ 38,360       $ 103,750       $ 87,163
Pro forma
   34,668       42,037       107,485       98,927
Basic earnings per share from continuing operations

As reported
   $ 0.48       $ 0.56       $ 1.50       $ 1.28
Pro forma
   0.49       0.61       1.55       1.45
Diluted earnings per share from continuing operations

As reported
   $ 0.45       $ 0.51       $ 1.39       $ 1.17
Pro forma
   0.45       0.56       1.43       1.33

~~During the nine months ended May 31, 2012, the Company paid $0.9 million~~

Table of deferred consideration for acquisitions completed in previous periods. Transaction costs related to various business acquisition activities were $1.0 million for the nine months ended May 31, 2012 and $0.9 million in the comparable prior year period.

Contents



	Three Months Ended				Nine Months Ended
	May 31, 2013		May 31, 2012		May 31, 2013		May 31, 2012
Net sales
As reported	$	344,205	$	343,268	$	952,482	$	954,153
Pro forma	344,205		354,825		952,482		1,005,826
Earnings from continuing operations
As reported	$	46,077	$	27,737	$	102,462	$	89,360
Pro forma	46,077		28,089		102,694		93,164
Basic earnings per share from continuing operations
As reported	$	0.63	$	0.39	$	1.40	$	1.29
Pro forma	0.63		0.40		1.41		1.35
Diluted earnings per share from continuing operations
As reported	$	0.62	$	0.36	$	1.38	$	1.19
Pro forma	0.62		0.37		1.38		1.24

Note 3. Discontinued Operations

The Electrical segment is primarily involved in the ~~second quarter~~design, manufacture and distribution of ~~fiscal 2011,~~a broad range of electrical products to the ~~Company completed~~retail DIY, wholesale, original equipment manufacturer (“OEM”), solar, utility, marine and other harsh environment markets. The results of operations for the ~~sale of the European~~ Electrical ~~business~~segment have been reported as discontinued operations for ~~total cash proceeds of $3.5 million, net of transaction costs. As~~all periods presented as a result of the ~~sale transaction,~~Company announcing its intention to divest this segment in the ~~Company recognized a pre-tax loss on disposal~~third quarter of ~~$15.8 million.~~fiscal 2013. The following table summarizes the results of ~~the European Electrical business, which has been reported as~~ discontinued operations (in thousands):

   Three Months Ended
May 31, 2011 Nine Months Ended
May 31, 2011
Net sales
   $ —      $ 49,305
Loss on disposal of business
   (2,086 ) (15,829 )
Loss from operations of divested business
   —      (1,157 )
Income tax benefit
   84    —


Loss from discontinued operations, net of income taxes
   $ (2,002 ) $ (16,986 )



	Three Months Ended						Nine Months Ended
	May 31, 2013			May 31, 2012			May 31, 2013			May 31, 2012
Net Sales	$	74,834		$	85,947		$	214,175		$	245,885

Operating income	11,903			8,801			25,084			19,800
Impairment charge	(170,339		)	—			(170,339		)	—
Income tax benefit (expense)	19,376			(2,137		)	14,588			(5,410		)
Income (loss) from discontinued operations, net of taxes	$	(139,060	)	$	6,664		$	(130,667	)	$	14,390

~~Note 4. Restructuring~~

InDuring the fourth quarter of fiscal ~~2009, in response~~2012, the Company recognized a $62.5 million pre-tax non-cash impairment charge related to the ~~dramatic downturn~~goodwill and indefinite lived intangible assets of the Mastervolt business (Electrical segment). The impairment was the result of business underperformance and volatility in the ~~worldwide economy,~~solar market. During the fourth quarter of fiscal 2012, industry-wide solar inverter inventory levels and production capacity exceeded demand, significant pricing competition existed and less favorable government incentive schemes were announced and implemented in Mastervolt's served European markets. This challenging economic and competitive environment, as well as uncertainty regarding the long-term strategic fit of the business had a significant adverse impact on projected long-term Mastervolt sales and profits. The impairment charge consisted of the write-down of $36.6 million of goodwill and $25.9 million of indefinite lived intangible assets (tradenames). Subsequent to this impairment charge, at August 31, 2012, there remained $40.0 million of goodwill and $13.6 million of indefinite lived intangible assets related to the Mastervolt business.

During the third quarter of fiscal 2013, the Company committed to a plan to divest the entire Electrical segment. The divestiture will allow the Company to streamline its strategy and refocus on the remaining three segments in a way that better positions the Company to take advantage of its core competencies, current business model and global growth trends. As a result, the Company recognized an impairment charge during the third quarter of fiscal 2013 of $170.3 million ($149.8 million, net of tax), including a write-down of $137.8 million of goodwill, $21.3 million of indefinite lived intangible assets (tradename) and $11.2 million of amortizable intangible assets. The impairment charge represents the excess of the net book value of the held for sale assets over the estimated fair value, less selling costs. As a result of the impairment charge, there is no remaining goodwill associated with the Mastervolt business and $76.9 million of remaining North American Electrical goodwill. The following is a summary of the May 31, 2013 assets and liabilities of discontinued operations (in thousands):

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Accounts receivable, net	$	42,745
Inventories, net	57,837
Property, plant & equipment, net	9,193
Goodwill	76,937
Other intangible assets, net	56,656
Other assets	20,690
Assets of discontinued operations	$	264,058

Trade accounts payable	$	19,844
Other current liabilities	12,167
Deferred income taxes	8,833
Other long-term liabilities	11,439
Liabilities of discontinued operations	$	52,283

Note 4. Restructuring

The Company continually reviews its cost structure to be responsive to changes in end market demand and identify cost reduction opportunities. As a result of increased uncertainty and reduced demand, the Company implemented various restructuring initiatives ~~including~~to reduce costs through workforce reductions, plant consolidations, the ~~transfer~~continued movement of production and product sourcing to ~~lower~~low cost ~~plants or regions~~countries and the centralization of certain selling and administrative functions. ~~These major actions were substantially completed by August 31, 2010, with limited restructuring activity in subsequent periods. Subsequent~~Resulting restructuring costs were ~~$0.5~~$1.5 million and ~~$2.0~~$2.0 million for the three and nine months ended May 31, 2013, respectively and $0.2 million and $0.3 million for the three and nine months ended May 31, 2012 ~~respectively~~. Restructuring charges are primarily included in selling, administrative and ~~$0.9 million and $1.7 million for~~engineering expenses in the ~~three and nine months ended May 31, 2011, respectively.~~

condensed consolidated statements of operations. The restructuring reserve at May 31, ~~2012~~2013 and August 31, ~~2011~~2012 was ~~$3.5~~$1.7 million and ~~$3.6~~$2.9 million, respectively. The remaining restructuring related to severance will be paid during the next twelve months, while facility consolidation costs (primarily reserves for future lease payments for vacated facilities) will be paid over the underlying lease terms.

As part of these restructuring initiatives, during the three months ended May 31, 2013, the Company divested the Nielsen Sessions business (Engineered Solutions segment) for $4.9 million of cash proceeds, which approximated its carrying value.

Note 5. Goodwill and Other Intangible Assets

The changes in the carrying value of goodwill for the nine months ended May 31, ~~2012~~2013 are as follows (in thousands):

   Industrial Energy Electrical Engineered
Solutions Total
Balance as of August 31, 2011
   $ 85,409    $ 252,285    $ 260,777    $ 289,995    $ 888,466
Businesses acquired
   —      14,101    —      5,462    19,563
Purchase accounting adjustments
   —      —      (3,995 ) 715    (3,280 )
Impact of changes in foreign currency rates
   (4,708 ) (12,195 ) (7,144 ) (7,020 ) (31,067 )


Balance as of May 31, 2012
   $ 80,701    $ 254,191    $ 249,638    $ 289,152    $ 873,682



	Industrial		Energy			Electrical			Engineered Solutions			Total
Balance as of August 31, 2012	$	81,404	$	259,521		$	213,870		$	311,617		$	866,412
Purchase accounting adjustments	—		117			—			608			725
Impairment charges	—		—			(137,548		)	—			(137,548		)
Discontinued operations reclassification	—		—			(76,937		)	—			(76,937		)
Sale of Nielsen Sessions	—		—			—			(2,556		)	(2,556		)
Impact of changes in foreign currency rates	750		(5,646		)	615			1,335			(2,946		)
Balance as of May 31, 2013	$	82,154	$	253,992		$	—		$	311,004		$	647,150

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The gross carrying value and accumulated amortization of the Company’s other intangible assets are as follows (in thousands):

Weighted May 31, 2012 August 31, 2011
Average Gross Net Gross Net
Amortization Carrying Accumulated Book Carrying Accumulated Book
Period (Years) Value Amortization Value Value Amortization Value
Amortizable intangible assets:

Customer relationships
15 $ 328,127    $ 87,345    $ 240,782    $ 331,171    $ 73,215    $ 257,956
Patents
13 50,259    33,802    16,457    51,169    31,221    19,948
Trademarks and tradenames
20 41,178    7,966    33,212    38,917    6,571    32,346
Non-compete agreements and other
  4 7,489    6,023    1,466    7,362    5,671    1,691
Indefinite lived intangible assets:

Tradenames
N/A 162,443    —      162,443    167,465    —      167,465

$ 589,496    $ 135,136    $ 454,360    $ 596,084    $ 116,678    $ 479,406



		May 31, 2013						August 31, 2012
	Weighted Average Amortization Period (Years)	Gross Carrying Value		Accumulated Amortization		Net Book Value		Gross Carrying Value		Accumulated Amortization		Net Book Value
Amortizable intangible assets:
Customer relationships	15	$	277,441	$	90,259	$	187,182	$	347,739	$	93,768	$	253,971
Patents	11	30,485		18,121		12,364		52,851		34,842		18,009
Trademarks and tradenames	19	24,381		7,125		17,256		43,820		8,670		35,150
Non-compete agreements and other	4	7,061		6,393		668		7,677		6,316		1,361
Indefinite lived intangible assets:
Tradenames	N/A	99,516		—		99,516		137,393		—		137,393
		$	438,884	$	121,898	$	316,986	$	589,480	$	143,596	$	445,884

Changes in the gross carrying value of intangible assets result from foreign currency exchange rate changes, impairment charges and the reclassification of Electrical segment intangible assets to assets of discontinued operations (refer to Note 3, "Discontinued Operations.") Amortization expense recorded on the intangible assets listed above was ~~$7.4~~$5.5 million and ~~$21.7~~$17.5 million for the three and nine months ended May 31, 2013, respectively and $5.6 million and $16.2 million for the three and nine months ended May 31, 2012 ~~respectively, and $6.9 million and $19.8 million for the three and nine months ended May 31, 2011,~~, respectively. The Company estimates that amortization expense will ~~approximate $7.4~~be approximately $5.1 million for the remainder of fiscal ~~2012.~~2013. Amortization expense for future years is estimated to be as follows: ~~$27.8~~$22.0 million in fiscal ~~2013, $26.2~~2014, $21.9 million in 2015, $21.8 million in fiscal ~~2014, $26.1~~2016, $20.8 million in fiscal ~~2015, $25.9~~2017, $20.4 million in fiscal ~~2016~~2018 and ~~$178.6~~$105.5 million thereafter. These future amortization expense amounts represent estimates, which may change based on future acquisitions, or changes in foreign currency exchange ~~rates.~~

rates or other factors.

Note 6. Product Warranty Costs

The Company generally offers its customers a warranty on products ~~sold,~~they purchase, although warranty periods vary by product type and application. ~~The acquisition of Mastervolt during fiscal 2011 has increased~~During the ~~required~~nine months ended May 31, 2012, the warranty reserve ~~as this business has~~was reduced by $7.7 million, the result of a ~~longer base~~purchase accounting adjustment to Mastervolt’s initial estimated warranty ~~period.~~reserve. The reserve for future warranty claims is based on historical claim rates and current warranty cost experience. The following is a rollforward of the accrued product warranty reserve (in thousands):

   Nine Months Ended May 31,
   2012 2011
Beginning balance
   $ 23,707    $ 7,868
Purchase accounting adjustments
   (7,726 ) —
Warranty reserves of acquired business
   237    10,870
Provision for warranties
   8,444    7,416
Warranty payments and costs incurred
   (8,567 ) (3,664 )
Impact of changes in foreign currency rates
   (2,043 ) 1,366


Ending balance
   $ 14,052    $ 23,856



	Nine Months Ended
	May 31, 2013			May 31, 2012
Beginning balances	$	12,869		$	23,707
Purchase accounting adjustments	—			(7,726		)
Warranty reserves of acquired businesses	—			237
Provision for warranties	5,093			8,444
Warranty payments and costs incurred	(8,158		)	(8,567		)
Discontinued operations reclassification	(4,769		)	—
Impact of changes in foreign currency rates	280			(2,043		)
Ending balances	$	5,315		$	14,052

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Note 7. Debt

The following is a summary of the Company’s long-term indebtedness (in thousands):

May 31, 2012 August 31, 2011
Senior Credit Facility

Revolver
$ —      $ 58,000
Term Loan
98,750    100,000

98,750    158,000
5.625% Senior Notes
300,000    —
6.875% Senior Notes
—      249,432

Total Senior Indebtedness
398,750    407,432
Convertible subordinated debentures (“2% Convertible Notes”)
—      117,795

Total Debt
398,750    525,227
Less: current maturities of long-term debt
(6,250 ) (2,500 )

Total long-term debt, less current maturities
$ 392,500    $ 522,727



	May 31, 2013			August 31, 2012
Senior Credit Facility
Revolver	$	—		$	—
Term Loan	92,500			97,500
	92,500			97,500
5.625% Senior Notes	300,000			300,000
Total Senior Indebtedness	392,500			397,500
Less: current maturities of long-term debt	(10,000		)	(7,500		)
Total long-term debt, less current maturities	$	382,500		$	390,000

The Company’s Senior Credit Facility, which matures on February 23, 2016 ~~provides~~, includes a ~~$600.0~~$600 million revolving credit facility, a ~~$100.0~~$100 million term loan and a ~~$300.0~~$300 million expansion option, subject to certain conditions. Borrowings are subject to a pricing grid, which can result in increases or decreases to the borrowing spread above LIBOR, depending on the Company’s leverage ratio, ranging from 1.25% to 2.50% in the case of loans bearing interest at LIBOR and from 0.25% to ~~1.25%~~1.50% in the case of loans bearing interest at the base rate. At May 31, ~~2012,~~2013, the borrowing spread on LIBOR based borrowings was ~~1.75%~~1.50% (aggregating ~~to 2.25% and 2.0%~~a 1.75% interest rate on the outstanding term ~~loan and revolver borrowings, respectively)~~loan). In addition, a non-use fee is payable quarterly on the average unused credit line under the revolver ranging from 0.2% to 0.4% per annum. At May 31, ~~2012~~2013 the available and unused credit line under the revolver was ~~$598.3 million.~~$596.7 million. Quarterly principal payments of ~~$1.25~~$1.25 million began on the ~~$100.0~~$100 million term loan on March 31, 2012, increasing to ~~$2.5~~$2.5 million per quarter beginning on March 31, 2013, with the remaining principal due at maturity. The Senior Credit Facility, which is secured by substantially all of the Company’s domestic personal property assets, also contains customary limits and restrictions concerning investments, sales of assets, liens on assets, dividends and other payments. The two financial covenants included in the Senior Credit Facility agreement are a maximum leverage ratio of ~~3.75:~~3.75:1 and a minimum fixed charge coverage ratio of ~~1.50:~~1.50:1. The Company was in compliance with all debt covenants at May 31, ~~2012.~~

2013.

On April 16, 2012, the Company issued ~~$300.0~~$300 million of 5.625% Senior Notes due 2022 (the “Senior Notes”) ~~in a private offering.~~. The Senior Notes require no principal installments prior to their June 15, 2022 maturity, require semiannual interest payments in December and June of each year and contain certain financial and non-financial covenants. The Company utilized the net proceeds from this issuance to fund the repurchase of all ~~the Company’s~~its then outstanding ~~$250.0~~$250 million of 6.875% Senior Notes due 2017 at a cost of 104%, or ~~a total of $260.4 million.~~

$260.4 million.

In November 2003, the Company issued $150.0 million of Senior Subordinated Convertible Debentures due November 15, 2023 (the “2% Convertible Notes”). Prior to fiscal 2012, the Company repurchased (for cash) $32.2 million of 2% Convertible Notes at an average price of 99.3% of par value. In addition, $0.2 million of 2% Convertible Notes were converted into shares of the Company’s Class A common stock in the first quarter of fiscal 2012. In March 2012, the Company called all of ~~the remaining $117.6~~its then outstanding $117.6 million of 2% Convertible Notes ~~outstanding~~ for cash at par. As a result of the call notice, ~~a majority~~substantially all of the holders of the 2% Convertible Notes converted them into newly issued shares of the Company’s Class A common stock, at a conversion rate of 50.6554 ~~shares~~ per $1,000 of principal amount (resulting in the issuance of 5,951,440 shares of common stock) while the remaining ~~$0.1~~$0.1 million of 2% Convertible Notes were repurchased for cash. The impact of the additional share issuance was already included in the diluted earnings per share calculation (See Note 9, “Earnings per Share”) on an if-converted method. As a result of the 2% Convertible Notes being redeemed for the Company’s common stock, approximately $15.6 million of related prior income tax will be recaptured.

In fiscal 2011, the Company entered into interest rate swap contracts that had a total notional value of $100.0 million and maturity dates of March 23, 2016. The interest rate swap contracts pay the Company variable interest at the three month LIBOR rate, and the Company pays the counterparties a fixed interest rate of approximately 2.06%. These interest rate swap contracts were entered into to synthetically convert $100.0 million of the Senior Credit Facility variable rate borrowings into fixed rate debt. In connection with the debt refinancing transactions discussed above, the Company terminated the interest rate swap contracts on April 3, 2012, which resulted in a cash payment to the counterparty of $4.1 million, in full settlement of the fair value of the contracts.

In connection with the debt refinancing activities, during the three months ended May 31, 2012, the Company recognized a ~~$16.8~~$16.8 million pre-tax debt refinancing charge, which included ~~$10.4~~$10.4 million of tender premium paid to holders of existing 6.875% Senior Notes, a ~~$2.3~~$2.3 million write-off of deferred financing ~~fees~~costs and debt discount and a ~~$4.1~~$4.1 million charge related to the termination of the interest rate swap agreements. ~~The related tax benefit on the debt refinancing charge was $6.3 million.~~

Note 8. Fair Value Measurement

The Company assesses the inputs used to measure the fair value of financial assets and liabilities using a three-tier hierarchy. Level 1 inputs include quoted prices for identical instruments and are the most observable. Level 2 inputs include quoted prices for similar assets and observable inputs such as interest rates, foreign currency exchange rates, commodity rates and yield curves. Level 3 inputs are not observable in the market and include management’s own judgments about the assumptions market participants would use in pricing the asset or liability. The ~~Company has no~~following financial assets orand liabilities, ~~that are recorded~~measured at fair value, ~~using significant unobservable inputs (Level 3). The fair value of financial assets and liabilities~~are included in the condensed consolidated balance sheet ~~are as follows~~ (in thousands):

   May 31, 2012 August 31, 2011
Level 1 Valuation:

Cash equivalents
   $ 681    $ 1,958
Investments
   1,514    1,464
Level 2 Valuation:

Foreign currency forward contracts
   $ (1,790 ) $ (81 )
Interest rate swap contracts
   —      (4,552 )

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	May 31, 2013		August 31, 2012
Level 1 Valuation:
Cash equivalents	$	1,095	$	5,154
Investments	1,788		1,602
Level 2 Valuation:
Foreign currency derivatives	$	335	$	945

At August 31, 2012, Mastervolt’s goodwill ($40.0 million) and tradename ($13.6 million) were written down to estimated fair value, resulting in a non-cash impairment charge of $62.5 million. In order to arrive at the implied fair value of goodwill, the Company assigned the fair value to all of the assets and liabilities of the reporting unit as if the reporting unit had been acquired in a business combination. The tradename was valued using the relief of royalty income approach. At May 31, 2013, the assets and liabilities of the Electrical segment are classified as discontinued operations and therefore are valued at fair value, less cost to sell. In determining the fair value of the Electrical segment asset group the Company utilized generally accepted valuation techniques, which required the Company to make assumptions and apply judgment to estimate macro economic factors, industry and market trends and the future profitability of current business strategies. These represent Level 3 assets measured at fair value on a nonrecurring basis.

The fair value of the Company’s cash, accounts receivable, accounts payable, short-term borrowings and its variable rate long-term debt approximated book value ~~as of~~ at both May 31, ~~2012~~2013 and August 31, ~~2011~~2012 due to their short-term nature and the fact that the ~~applicable~~ interest rates approximated market ~~rates of interest.~~rates. The fair value of the Company’s outstanding ~~$117.8~~$300 million ~~2% Convertible Notes at August 31, 2011 was $127.9 million, while the fair value~~ of ~~the Company’s outstanding $250.0 million of 6.875%~~5.625% Senior Notes was ~~$252.5 million.~~$309.8 million at both May 31, 2013 and August 31, 2012. The fair value of the ~~Company’s outstanding $300.0 million of 5.625%~~ Senior Notes ~~at May 31, 2012~~ was ~~$306.8 million. These fair values were~~ based on quoted inactive market prices and are therefore classified as Level 2 within the valuation hierarchy.

Note 9. Derivatives

All derivatives are recognized in the balance sheet at their estimated fair value. On the date it enters into a derivative contract, the Company designates the derivative as a hedge of a recognized asset or liability (fair value hedge) or a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). The Company does not enter into derivatives for speculative purposes. Changes in the value of fair value hedges and non-designated hedges are recorded in earnings along with the gain or loss on the hedged asset or liability, while changes in the value of cash flow hedges are recorded in accumulated other comprehensive loss, until earnings are affected by the variability of cash flows. The fair value of outstanding foreign currency derivatives was an asset of $0.3 million and $0.9 million at May 31, 2013 and August 31, 2012, respectively.

The Company is exposed to market risk for changes in foreign currency exchange rates due to the global nature of its operations. In order to manage this risk the Company has hedged portions of its forecasted inventory purchases that are denominated in non-functional currencies (cash flow hedges). The U.S. dollar equivalent notional value of these foreign currency forward contracts was $12.7 million and $2.8 million, at May 31, 2013 and August 31, 2012, respectively. At May 31, 2013, unrealized gains of $0.1 million were included in accumulated other comprehensive loss and are expected to be reclassified to earnings during the next twelve months.

The Company also utilizes forward foreign currency exchange contracts to reduce the exchange rate risk associated with recognized non-functional currency balances. The effects of changes in exchange rates are reflected concurrently in earnings for both the fair value of the foreign currency exchange contracts and the related non-functional currency asset or liability. The U.S. dollar equivalent notional value of these short duration foreign currency forward contracts was $133.6 million and $197.5 million, at May 31, 2013 and August 31, 2012, respectively. Net foreign currency gains related to these derivative instruments was $0.3 million and less than $0.1 million for the three and nine months ended May 31, 2013, respectively which offset foreign currency losses from the related revaluation on non-functional currency assets and liabilities (amounts included in other income and expense in the condensed consolidated statement of operations).

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Note 9.10. Earnings Per Share

The reconciliations between basic and diluted earnings per share from continuing operations are as follows (in thousands, except per share amounts):

   Three Months Ended May 31,    Nine Months Ended May 31,
   2012 2011    2012    2011
Numerator:

Net earnings from continuing operations
   $ 34,401    $ 38,360       $ 103,750       $ 87,163
Plus: 2% Convertible Notes financings costs, net of taxes
   (468 ) 383       425       1,222






Net earnings for diluted earnings per share
   $ 33,933    $ 38,743       $ 104,175       $ 88,385






Denominator:

Weighted average common shares outstanding for basic earnings per share
   71,083    68,354       69,184       68,208
Net effect of dilutive securities—equity based compensation plans
   1,310    1,250       1,053       1,145
Net effect of 2% Convertible Notes based on the if-converted method
   2,978    5,967       4,964       5,961






Weighted average common and equivalent shares outstanding for diluted earnings per share
   75,371    75,571       75,201       75,314






Basic Earnings Per Share:
   $ 0.48    $ 0.56       $ 1.50       $ 1.28
Diluted Earnings Per Share:
   $ 0.45    $ 0.51       $ 1.39       $ 1.17
Anti-dilutive securities—equity based compensation plans
(excluded from earnings per share calculation)
   2,173    1,863       2,735       2,295



	Three Months Ended					Nine Months Ended
	May 31, 2013		May 31, 2012			May 31, 2013		May 31, 2012
Numerator:
Earnings from continuing operations	$	46,077	$	27,737		$	102,462	$	89,360
Plus: 2% Convertible Notes financing costs, net of taxes	—		(468		)	—		425
Earnings from continuing operations for diluted earnings per share	$	46,077	$	27,269		$	102,462	$	89,785
Denominator:
Weighted average common shares outstanding for basic earnings per share	73,133		71,083			72,957		69,184
Net effect of dilutive securities—stock based compensation plans	1,654		1,310			1,534		1,053
Net effect of 2% Convertible Notes based on the if-converted method	—		2,978			—		4,964
Weighted average common and equivalent shares outstanding for diluted earnings per share	74,787		75,371			74,491		75,201

Earnings per common share from continuing operations:
Basic	$	0.63	$	0.39		$	1.40	$	1.29
Diluted	$	0.62	$	0.36		$	1.38	$	1.19

Anti-dilutive securities-stock based compensation plans (excluded from earnings per share calculation)	656		2,173			735		2,735

Note ~~10.~~11. Income Taxes

The ~~Company’s~~Company's income tax expense is impacted by a number of factors, including the amount of taxable earnings derived in foreign jurisdictions with tax rates that are higher or lower than the U.S. ~~federal~~Federal statutory rate, permanent items, tax reserve adjustments, state tax rates and ~~our~~the ability to utilize various tax credits and net operating loss carryforwards.

The Company adjusts the quarterly provision for income taxes based on the estimated annual effective income tax rate and facts and circumstances known at each interim reporting period.

The effective income tax rate from continuing operations was ~~16.1%~~7.7% and ~~20.9%~~12.5% for the three and nine months ended May 31, ~~2012,~~2013, respectively, and ~~23.0%~~13.8% and ~~22.0%~~19.8% for the comparable prior year periods. The decrease in the effective tax rate ~~for the three and nine months ended May 31, 2012,~~ relative to the prior year, reflects the ~~benefit~~benefits of ~~foreign~~ tax ~~credits, favorable tax reserve adjustments as a result of the lapsing of various tax statutes of limitations,~~minimization planning, the utilization of net operating losses and discrete items. Income tax expense for the third quarter of fiscal 2013 included discrete period income tax benefits related to provision to income tax return adjustments of $0.7 million and a $9.3 million reversal of tax reserves established in prior years (as a result of the lapsing of non-U.S. income tax statues of limitations), while the prior year period included a $6.3 million discrete income tax benefit onassociated with the debt refinancing ~~charges (Note~~charge (see Note 7, ~~“Debt”~~"Debt") ~~being recognized at the U.S. statutory rates (which are higher than the Company’s consolidated global effective tax rate)~~.

The gross liability for unrecognized tax benefits, excluding interest and penalties, decreased from ~~$26.2~~$24.6 million at August 31, ~~2011~~2012 to ~~$24.2~~$18.2 million at May 31, ~~2012.~~2013. Substantially all of these unrecognized tax benefits, if recognized, would reduce the effective income tax rate. In addition, as of May 31, 2013 and August 31, ~~2011 and May 31,~~ 2012, the Company had liabilities totaling ~~$5.1~~$2.8 million and ~~$4.4~~$4.5 million, respectively, for ~~estimated~~the payment of interest and penalties related to its unrecognized income tax benefits.

~~Note 11. Other Comprehensive Income (Loss)~~

~~The Company’s comprehensive income is significantly impacted by the movement~~

Table of ~~the U.S. dollar versus other global currencies, most notably the Euro and British Pound. The following table sets forth the reconciliation of net earnings to comprehensive income (in thousands):~~

   Three Months Ended May 31, Nine Months Ended May 31,
   2012 2011 2012 2011
Net earnings
   $ 34,401    $ 36,358    $ 103,750    $ 70,177
Foreign currency translation adjustment
   (36,448 ) 20,114    (65,043 ) 47,924
Changes in net unrealized gains and losses, net of tax
   2,940    (787 ) 2,911    2,052


Comprehensive income
   $ 893    $ 55,685    $ 41,618    $ 120,153


Contents

Note 12. Segment Information

The Company is a global manufacturer of a broad range of industrial products and systems and is organized into ~~four~~three reportable segments: Industrial, Energy ~~Electrical,~~ and Engineered Solutions. The Industrial segment is primarily involved in the design, manufacture and distribution of branded hydraulic and mechanical tools to the maintenance, industrial, infrastructure and production automation markets. The Energy segment provides joint integrity products and services, as well as rope and cable solutions to the global oil & gas, power generation and ~~other~~ energy markets. The Electrical segment designs, manufactures and distributes a broad range of electrical products to the retail DIY, wholesale, original equipment manufacturer (“OEM”), solar, utility, marine and harsh environment markets. The Engineered Solutions segment provides highly engineered position and motion control systems to OEMs in various ~~on and off-highway~~ vehicle markets, as well as a variety of other products to the industrial and agricultural markets.

In the third quarter of fiscal 2013, the Company announced that it had commenced a plan to divest the Electrical Segment. The Electrical segment, which is presented as a discontinued operation, designs, manufactures and distributes a broad range of electrical products to the retail DIY, wholesale, OEM, solar, utility, marine and other harsh environment markets.

The following tables summarize financial information by reportable segment and product line (in thousands):

   Three Months Ended May 31, Nine Months Ended May 31,
   2012 2011 2012 2011
Net Sales by Segment:

Industrial
   $ 110,102    $ 107,759    $ 308,696    $ 284,086
Energy
   96,399    78,002    255,758    210,333
Electrical
   85,947    80,329    245,885    205,901
Engineered Solutions
   136,767    126,687    389,699    341,567


   $ 429,215    $ 392,777    $ 1,200,038    $ 1,041,887


Net Sales by Reportable Product Line:

Industrial
   $ 110,102    $ 107,759    $ 308,696    $ 284,086
Energy
   96,399    78,002    255,758    210,333
Electrical
   85,947    80,329    245,885    �� 205,901
Vehicle Systems
   75,417    94,423    220,696    250,926
Other
   61,350    32,264    169,003    90,641


   $ 429,215    $ 392,777    $ 1,200,038    $ 1,041,887


Operating Profit:

Industrial
   $ 30,682    $ 29,517    $ 85,307    $ 69,853
Energy
   18,515    13,545    43,364    32,194
Electrical
   8,814    5,462    19,592    14,168
Engineered Solutions
   18,467    19,977    50,747    47,203
General Corporate
   (8,814 ) (10,500 ) (24,609 ) (26,799 )


   $ 67,664    $ 58,001    $ 174,401    $ 136,619


   May 31, 2012
August 31,
2011



Assets:

Industrial
   $ 277,918    $ 263,680
Energy
   532,871    517,428
Electrical
   506,248    547,556
Engineered Solutions
   621,197    632,242
General Corporate
   95,875    95,775


   $ 2,034,109    $ 2,056,681



	Three Months Ended						Nine Months Ended
	May 31, 2013			May 31, 2012			May 31, 2013			May 31, 2012
Net Sales by Segment:
Industrial	$	111,308		$	110,102		$	311,429		$	308,696
Energy	99,158			96,399			270,721			255,758
Engineered Solutions	133,739			136,767			370,332			389,699
	$	344,205		$	343,268		$	952,482		$	954,153
Net Sales by Reportable Product Line:
Industrial	$	111,308		$	110,102		$	311,429		$	308,696
Energy	99,158			96,399			270,721			255,758
Vehicle Systems	68,202			75,417			189,064			220,696
Other	65,537			61,350			181,268			169,003
	$	344,205		$	343,268		$	952,482		$	954,153
Operating Profit:
Industrial	$	32,426		$	30,682		$	85,782		$	85,307
Energy	19,736			18,515			44,800			43,364
Engineered Solutions	12,754			18,467			28,654			50,747
General Corporate	(7,874		)	(8,814		)	(21,849		)	(24,609		)
	$	57,042		$	58,850		$	137,387		$	154,809



	May 31, 2013		August 31, 2012
Assets:
Industrial	$	284,286	$	268,735
Energy	552,188		540,409
Electrical	—		437,914
Engineered Solutions	657,951		667,550
General Corporate	160,991		92,511
Assets of Discontinued Operations	264,058		—
	$	1,919,474	$	2,007,119

In addition to the impact of changes in foreign currency exchange rates, the comparability of segment and product line information is also impacted by ~~acquisitions.~~acquisition/divestiture activities and restructuring costs and the related benefits. Corporate assets, which are not allocated, principally represent cash and cash equivalents, capitalized debt issuance costs and deferred income ~~taxes and the fair value~~taxes.

Table of ~~derivative instruments.~~

Contents

Note 13. Contingencies and Litigation

The Company had outstanding letters of credit of ~~$8.5~~$10.5 million and ~~$9.5~~$8.5 million at May 31, ~~2012~~2013 and August 31, ~~2011,~~2012, respectively, the majority of which secure self-insured workers compensation liabilities.

The Company is a party to various legal proceedings that have arisen in the normal course of its business. These legal proceedings typically include product liability, environmental, labor, patent claims and ~~divestiture~~other disputes. The Company has recorded reserves for loss contingencies based on the specific circumstances of each case. Such reserves are recorded when it is probable that a loss has been incurred as of the balance sheet date and can be reasonably ~~estimated and is not covered by insurance.~~estimated. In the opinion of management, the resolution of these contingencies, individually and in the aggregate, will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

The Company, in the normal course of business, enters into certain real estate and equipment leases or guarantees such leases on behalf of its subsidiaries. In conjunction with the spin-off of a former subsidiary in fiscal 2000, the Company assigned its rights in the leases used by the former subsidiary, but was not released as a responsible party from all such leases by the lessors. All of these businesses were subsequently sold. The Company remains contingently liable for those leases if any of these businesses are unable to fulfill their obligations thereunder. The discounted present value of future minimum lease payments for these leases was $3.7 million at May 31, 2012.

The Company has facilities in numerous geographic locations that are subject to a range of environmental laws and regulations. Environmental expenditures over the past ~~three~~two years have not been material. Management believes that such costs will not have a material adverse effect on the Company’s financial ~~condition,~~position, results of operations or cash flows.

The Company remains contingently liable for lease payments under leases of businesses that it previously divested or spun-off, in the event that such businesses are unable to fulfill their future lease payment obligations. The discounted present value of future minimum lease payments for these leases was $11.9 million at May 31, 2013.

Note 14. Guarantor Subsidiaries

As discussed in Note 7, “Debt” on

On April 16, 2012, Actuant Corporation (the “Parent”) issued ~~$300.0~~$300.0 million of 5.625% Senior ~~Notes due 2022.~~Notes. All ~~of the Company’s~~ material domestic wholly owned subsidiaries (the “Guarantors”) fully and unconditionally guarantee (except for certain customary limitations) ~~the 5.625% Senior Notes~~such debt on a joint and several basis. The Company plans to file a registration statement on Form S-4 with the Securities and Exchange Commission (the “SEC”) with respect to its offer to exchange new 5.625% Senior Secured Notes due 2022 that have been registered under the Securities Act of 1933 for any and all of its outstanding 5.625% Senior Secured Notes due 2022 that have not been so registered. There are no significant restrictions on the ability of the Guarantors to make distributions to the Parent. The following tables present the results of operations, financial position and cash flows of Actuant Corporation and its subsidiaries, the Guarantor and non-Guarantor entities, and the eliminations necessary to arrive at the information for the Company on a consolidated basis.

Certain assets, liabilities and expenses have not been allocated to the Guarantors and non-Guarantors and therefore are included in the Parent column in the accompanying condensed consolidating financial statements. These items are of a corporate or consolidated nature and include, but are not limited to, tax provisions and related assets and liabilities, certain employee benefit obligations, prepaid and accrued insurance and corporate indebtedness. Intercompany activity in the condensed consolidating financial statements primarily includes loan activity, purchases and sales of goods or services and dividends. Intercompany balances also reflect certain non-cash transactions including transfers of assets and liabilities between the Parent, Guarantor and non-Guarantor, allocation of non-cash expenses from the Parent to the Guarantors and non-Guarantors, the impact of foreign currency rate changes and non-cash intercompany dividends.

Table of Contents

CONDENSED CONSOLIDATING STATEMENTS OF ~~EARNINGS~~

OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands)

Three Months Ended May 31, 2012
Parent Guarantors Non-
Guarantors Eliminations Consolidated
Net sales
$ 53,206    $ 153,967    $ 222,042    $ —      $ 429,215
Cost of products sold
17,112    105,368    140,615    —      263,095

Gross profit
36,094    48,599    81,427    —      166,120
Selling, administrative and engineering expenses
21,609    26,264    43,190    —      91,063
Amortization of intangible assets
335    3,412    3,646    —      7,393

Operating profit
14,150    18,923    34,591    —      67,664
Financing costs, net
7,255    (22 ) 3    —      7,236
Intercompany expense (income), net
(8,412 ) 1,432    6,980    —      —
Debt refinancing charges
16,830    —      —      —      16,830
Other expense (income), net
(111 ) 907    1,808    —      2,604

Earnings (loss) before income tax expense (benefit)
(1,412 ) 16,606    25,800    —      40,994
Income tax expense (benefit)
(2,898 ) 3,716    5,775    —      6,593

Net earnings before equity in earnings of subsidiaries
1,486    12,890    20,025    —      34,401
Equity in earnings (loss) of subsidiaries
32,915    16,521    (450 ) (48,986 ) —

Net earnings
$ 34,401    $ 29,411    $ 19,575    $ (48,986 ) $ 34,401

Three Months Ended May 31, 2011
Parent Guarantors Non-
Guarantors Eliminations Consolidated
Net sales
$ 45,301    $ 142,145    $ 205,331    $ —      $ 392,777
Cost of products sold
11,904    97,584    129,251    —      238,739

Gross profit
33,397    44,561    76,080    —      154,038
Selling, administrative and engineering expenses
24,840    24,568    39,758    —      89,166
Amortization of intangible assets
—      3,893    2,978    —      6,871

Operating profit
8,557    16,100    33,344    —      58,001
Financing costs, net
7,850    —      —      —      7,850
Intercompany expense (income), net
(984 ) 4,453    (3,469 ) —      —
Other expense (income), net
(3,628 ) 194    3,765    —      331

Earnings from continuing operations before income tax expense
5,319    11,453    33,048    —      49,820
Income tax expense
1,224    2,635    7,601    —      11,460

Net earnings from continuing operations before equity in earnings of subsidiaries
4,095    8,818    25,447    —      38,360
Equity in earnings of subsidiaries
33,136    22,368    1,232    (56,736 ) —

Earnings from continuing operations
37,231    31,186    26,679    (56,736 ) 38,360
Loss from discontinued operations, net of income taxes
(873 ) —      (1,129 ) —      (2,002 )

Net earnings
$ 36,358    $ 31,186    $ 25,550    $ (56,736 ) $ 36,358



	Three Months Ended May 31, 2013
	Parent			Guarantors			Non-Guarantors			Eliminations		Consolidated
Net sales	$	52,126		$	83,279		$	208,800		$	—	$	344,205
Cost of products sold	14,938			55,610			136,753			—		207,301
Gross profit	37,188			27,669			72,047			—		136,904
Selling, administrative and engineering expenses	18,389			14,622			41,312			—		74,323
Amortization of intangible assets	318			2,592			2,629			—		5,539
Operating profit	18,481			10,455			28,106			—		57,042
Financing costs, net	6,279			3			(53		)	—		6,229
Intercompany expense (income), net	(6,487		)	637			5,850			—		—
Other expense (income), net	267			(115		)	759			—		911
Earnings from continuing operations before income tax expense	18,422			9,930			21,550			—		49,902
Income tax expense	1,412			761			1,652			—		3,825
Net earnings before equity in loss of subsidiaries	17,010			9,169			19,898			—		46,077
Equity in loss of subsidiaries	(109,558		)	(38,891		)	(1,827		)	150,276		—
Earnings (loss) from continuing operations	(92,548		)	(29,722		)	18,071			150,276		46,077
Loss from discontinued operations	(435		)	(94,888		)	(43,737		)	—		(139,060		)
Net loss	$	(92,983	)	$	(124,610	)	$	(25,666	)	$	150,276	$	(92,983	)
Comprehensive loss	$	(97,951	)	$	(124,714	)	$	(30,396	)	$	155,110	$	(97,951	)

Table of Contents

CONDENSED CONSOLIDATING STATEMENTS OF ~~EARNINGS~~

OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands)

   Nine Months Ended May 31, 2012
   Parent Guarantors Non-
Guarantors Eliminations Consolidated
Net sales
   $ 151,240    $ 427,839    $ 620,959    $ —      $ 1,200,038
Cost of products sold
   49,505    297,651    392,862    —      740,018


Gross profit
   101,735    130,188    228,097    —      460,020
Selling, administrative and engineering expenses
   61,935    79,138    122,862    —      263,935
Amortization of intangible assets
   1,005    10,243    10,436    —      21,684


Operating profit
   38,795    40,807    94,799    —      174,401
Financing costs, net
   23,527    (14 ) (234 ) —      23,279
Intercompany expense (income), net
   (24,585 ) 3,731    20,854    —      —
Debt refinancing charges
   16,830    —      —      —      16,830
Other expense (income), net
   904    2,581    (395 ) —      3,090


Earnings before income tax expense
   22,119    34,509    74,574    —      131,202
Income tax expense
   2,542    7,858    17,052    —      27,452


Net earnings before equity in earnings of subsidiaries
   19,577    26,651    57,522    —      103,750
Equity in earnings of subsidiaries
   84,173    51,134    988    (136,295 ) —


Net earnings
   $ 103,750    $ 77,785    $ 58,510    $ (136,295 ) $ 103,750


   Nine Months Ended May 31, 2011
   Parent Guarantors Non-
Guarantors Eliminations Consolidated
Net sales
   $ 119,206    $ 388,059    $ 534,622    $ —      $ 1,041,887
Cost of products sold
   33,838    270,580    336,551    —      640,969


Gross profit
   85,368    117,479    198,071    —      400,918
Selling, administrative and engineering expenses
   64,024    72,765    107,664    —      244,453
Amortization of intangible assets
   —      11,401    8,445    —      19,846


Operating profit
   21,344    33,313    81,962    —      136,619
Financing costs, net
   23,640    —      —      —      23,640
Intercompany expense (income), net
   (8,412 ) 12,479    (4,067 ) —      —
Other expense (income), net
   (4,324 ) 162    5,438    —      1,276


Earnings from continuing operations before income tax expense
   10,440    20,672    80,591    —      111,703
Income tax expense
   2,374    4,608    17,558    —      24,540


Net earnings from continuing operations before equity in earnings of subsidiaries
   8,066    16,064    63,033    —      87,163
Equity in earnings of subsidiaries
   76,864    51,780    3,429    (132,073 ) —


Earnings from continuing operations
   84,930    67,844    66,462    (132,073 ) 87,163
Loss from discontinued operations, net of income taxes
   (14,753 ) —      (2,233 ) —      (16,986 )


Net earnings
   $ 70,177    $ 67,844    $ 64,229    $ (132,073 ) $ 70,177



	Three Months Ended May 31, 2012
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	53,206		$	89,914		$	200,148		$	—		$	343,268
Cost of products sold	17,111			58,686			128,717			—			204,514
Gross profit	36,095			31,228			71,431			—			138,754
Selling, administrative and engineering expenses	20,968			15,749			37,624			—			74,341
Amortization of intangible assets	335			2,620			2,608			—			5,563
Operating profit	14,792			12,859			31,199			—			58,850
Financing costs, net	7,255			(22		)	3			—			7,236
Intercompany expense (income), net	(8,412		)	1,432			6,980			—			—
Debt refinancing costs	16,830			—			—			—			16,830
Other expense (income), net	(111		)	944			1,758			—			2,591
Earnings (loss) from continuing operations before income tax expense (benefit)	(770		)	10,505			22,458			—			32,193
Income tax expense (benefit)	(2,742		)	2,233			4,965			—			4,456
Net earnings before equity in earnings (loss) of subsidiaries	1,972			8,272			17,493			—			27,737
Equity in earnings (loss) of subsidiaries	32,915			16,521			(450		)	(48,986		)	—
Earnings from continuing operations	34,887			24,793			17,043			(48,986		)	27,737
Earnings (loss) from discontinued operations	(486		)	4,618			2,532			—			6,664
Net earnings	$	34,401		$	29,411		$	19,575		$	(48,986	)	$	34,401
Comprehensive income	$	893		$	12,418		$	1,779		$	(14,197	)	$	893

Table of Contents

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands)



	Nine Months Ended May 31, 2013
	Parent			Guarantors			Non-Guarantors			Eliminations		Consolidated
Net sales	$	145,371		$	220,178		$	586,933		$	—	$	952,482
Cost of products sold	42,285			151,308			381,439			—		575,032
Gross profit	103,086			68,870			205,494			—		377,450
Selling, administrative and engineering expenses	53,347			44,348			124,826			—		222,521
Amortization of intangible assets	958			7,906			8,678			—		17,542
Operating profit	48,781			16,616			71,990			—		137,387
Financing costs, net	19,046			9			(244		)	—		18,811
Intercompany expense (income), net	(18,408		)	1,716			16,692			—		—
Other expense (income), net	(480		)	(579		)	2,577			—		1,518
Earnings from continuing operations before income tax expense	48,623			15,470			52,965			—		117,058
Income tax expense	7,420			435			6,741			—		14,596
Net earnings before equity in loss of subsidiaries	41,203			15,035			46,224			—		102,462
Equity in loss of subsidiaries	(68,323		)	(10,227		)	(1,392		)	79,942		—
Earnings (loss) from continuing operations	(27,120		)	4,808			44,832			79,942		102,462
Loss from discontinued operations	(1,085		)	(89,510		)	(40,072		)	—		(130,667		)
Net earnings (loss)	$	(28,205	)	$	(84,702	)	$	4,760		$	79,942	$	(28,205	)
Comprehensive income (loss)	$	(32,969	)	$	(91,016	)	$	7,632		$	83,384	$	(32,969	)

Table of Contents

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands)



	Nine Months Ended May 31, 2012
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	151,240		$	248,836		$	554,077		$	—		$	954,153
Cost of products sold	49,502			166,150			356,649			—			572,301
Gross profit	101,738			82,686			197,428			—			381,852
Selling, administrative and engineering expenses	59,555			45,942			105,309			—			210,806
Amortization of intangible assets	1,005			7,870			7,362			—			16,237
Operating profit	41,178			28,874			84,757			—			154,809
Financing costs, net	23,527			(14		)	(233		)	—			23,280
Intercompany expense (income), net	(24,585		)	3,731			20,854			—			—
Debt refinancing costs	16,830			—			—			—			16,830
Other expense (income), net	904			2,633			(240		)	—			3,297
Earnings from continuing operations before income tax expense	24,502			22,524			64,376			—			111,402
Income tax expense	3,193			4,587			14,262			—			22,042
Net earnings before equity in earnings of subsidiaries	21,309			17,937			50,114			—			89,360
Equity in earnings of subsidiaries	84,173			51,134			988			(136,295		)	—
Earnings from continuing operations	105,482			69,071			51,102			(136,295		)	89,360
Earnings (loss) from discontinued operations	(1,732		)	8,714			7,408			—			14,390
Net earnings	$	103,750		$	77,785		$	58,510		$	(136,295	)	$	103,750
Comprehensive income	$	41,618		$	45,346		$	35,141		$	(80,487	)	$	41,618

Table of Contents

CONDENSED CONSOLIDATING BALANCE SHEETS

(In thousands)

   May 31, 2012
   Parent    Guarantors    Non-
Guarantors    Eliminations Consolidated
ASSETS

Current assets
   $ 83,779       $ 159,031       $ 332,481       $ —      $ 575,291
Property, plant & equipment, net
   6,684       33,251       76,030       —      115,965
Goodwill
   62,543       433,193       377,946       —      873,682
Other intangibles, net
   14,857       206,925       232,578       —      454,360
Intercompany receivable
   —         399,007       281,587       (680,594 ) —
Investment in subsidiaries
   1,884,934       440,620       120,266       (2,445,820 ) —
Other long-term assets
   12,490       22       2,299       —      14,811








Total assets
   $ 2,065,287       $ 1,672,049       $ 1,423,187       $ (3,126,414 ) $ 2,034,109








LIABILITIES & SHAREHOLDERS’ EQUITY

Current liabilities
   $ 90,009       $ 63,592       $ 172,161       $ —      $ 325,762
Long-term debt
   392,500       —         —         —      392,500
Deferred income taxes
   92,126       —         41,493       —      133,619
Pension and post-retirement benefit liabilities
   16,119       —         2,052       —      18,171
Other long-term liabilities
   59,234       660       26,878       —      86,772
Intercompany payable
   338,014       —         342,580       (680,594 ) —
Shareholders’ equity
   1,077,285       1,607,797       838,023       (2,445,820 ) 1,077,285








Total liabilities and shareholders’ equity
   $ 2,065,287       $ 1,672,049       $ 1,423,187       $ (3,126,414 ) $ 2,034,109



	May 31, 2013
	Parent		Guarantors		Non-Guarantors		Eliminations			Consolidated
ASSETS
Current assets
Cash and cash equivalents	$	26,338	$	—	$	135,080	$	—		$	161,418
Accounts receivable, net	19,860		47,019		147,804		—			214,683
Inventories, net	27,963		34,683		82,580		—			145,226
Deferred income taxes	20,504		—		1,999		—			22,503
Other current assets	7,681		901		17,814		—			26,396
Current assets of discontinued operations	—		183,619		80,439		—			264,058
Total current assets	102,346		266,222		465,716		—			834,284
Property, plant & equipment, net	6,958		23,811		73,834		—			104,603
Goodwill	62,543		264,502		320,105		—			647,150
Other intangibles, net	13,565		143,833		159,588		—			316,986
Investment in subsidiaries	1,786,263		201,779		96,333		(2,084,375		)	—
Intercompany receivable	—		448,334		261,163		(709,497		)	—
Other long-term assets	10,957		22		5,472		—			16,451
Total assets	$	1,982,632	$	1,348,503	$	1,382,211	$	(2,793,872	)	$	1,919,474
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable	$	20,155	$	27,284	$	100,459	$	—		$	147,898
Accrued compensation and benefits	14,076		3,036		24,943		—			42,055
Current maturities of long-term debt	10,000		—		—		—			10,000
Income taxes payable	8,811		—		539		—			9,350
Other current liabilities	20,083		4,484		27,390		—			51,957
Current liabilities of discontinued operations	—		23,780		28,503		—			52,283
Total current liabilities	73,125		58,584		181,834		—			313,543
Long-term debt	382,500		—		—		—			382,500
Deferred income taxes	70,371		—		27,374		—			97,745
Pension and postretirement benefit liabilities	21,728		—		3,839		—			25,567
Other long-term liabilities	53,325		428		14,528		—			68,281
Intercompany payable	349,745		—		359,752		(709,497		)	—
Shareholders’ equity	1,031,838		1,289,491		794,884		(2,084,375		)	1,031,838
Total liabilities and shareholders’ equity	$	1,982,632	$	1,348,503	$	1,382,211	$	(2,793,872	)	$	1,919,474

Table of Contents

CONDENSED CONSOLIDATING BALANCE SHEETS

(In thousands)

   August 31, 2011
   Parent    Guarantors    Non-
Guarantors    Eliminations Consolidated
ASSETS

Current assets
   $ 87,982       $ 155,067       $ 303,435       $ —      $ 546,484
Property, plant & equipment, net
   4,327       37,133       87,189       —      128,649
Goodwill
   62,543       432,184       393,739       —      888,466
Other intangibles, net
   15,861       216,277       247,268       —      479,406
Intercompany receivable
   —         277,157       288,701       (565,858 ) —
Investment in subsidiaries
   1,859,779       379,170       67,794       (2,306,743 ) —
Other long-term assets
   10,862       51       2,763       —      13,676








Total assets
   $ 2,041,354       $ 1,497,039       $ 1,390,889       $ (2,872,601 ) $ 2,056,681








LIABILITIES & SHAREHOLDERS’ EQUITY

Current liabilities
   $ 76,300       $ 70,126       $ 183,877       $ —      $ 330,303
Long-term debt
   522,727       —         —         —      522,727
Deferred income taxes
   124,469       —         41,476       —      165,945
Pension and post-retirement benefit liabilities
   16,452       —         2,412       —      18,864
Other long-term liabilities
   59,466       779       39,584       —      99,829
Intercompany payable
   322,927       —         242,931       (565,858 ) —
Shareholders’ equity
   919,013       1,426,134       880,609       (2,306,743 ) 919,013








Total liabilities and shareholders’ equity
   $ 2,041,354       $ 1,497,039       $ 1,390,889       $ (2,872,601 ) $ 2,056,681



	August 31, 2012
	Parent		Guarantors		Non-Guarantors		Eliminations			Consolidated
ASSETS
Current assets
Cash and cash equivalents	$	12,401	$	91	$	55,692	$	—		$	68,184
Accounts receivable, net	20,401		74,006		140,349		—			234,756
Inventories, net	29,658		75,905		106,127		—			211,690
Deferred income taxes	17,942		—		4,641		—			22,583
Other current assets	8,157		1,166		14,745		—			24,068
Total current assets	88,559		151,168		321,554		—			561,281
Property, plant & equipment, net	6,944		31,818		77,122		—			115,884
Goodwill	62,543		433,193		370,676		—			866,412
Other intangibles, net	14,522		206,194		225,168		—			445,884
Investment in subsidiaries	1,886,478		250,738		90,770		(2,227,986		)	—
Intercompany receivable	—		418,253		307,282		(725,535		)	—
Other long-term assets	12,297		22		5,339		—			17,658
Total assets	$	2,071,343	$	1,491,386	$	1,397,911	$	(2,953,521	)	$	2,007,119
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable	$	21,722	$	44,893	$	108,131	$	—		$	174,746
Accrued compensation and benefits	23,459		6,646		28,712		—			58,817
Current maturities of long-term debt	7,500		—		—		—			7,500
Income taxes payable	3,129		—		2,649		—			5,778
Other current liabilities	20,876		11,566		39,723		—			72,165
Total current liabilities	76,686		63,105		179,215		—			319,006
Long-term debt	390,000		—		—		—			390,000
Deferred income taxes	91,604		—		41,049		—			132,653
Pension and postretirement benefit liabilities	22,500		—		3,942		—			26,442
Other long-term liabilities	59,929		620		26,633		—			87,182
Intercompany payable	378,788		—		346,747		(725,535		)	—
Shareholders’ equity	1,051,836		1,427,661		800,325		(2,227,986		)	1,051,836
Total liabilities and shareholders’ equity	$	2,071,343	$	1,491,386	$	1,397,911	$	(2,953,521	)	$	2,007,119

Table of Contents

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(In thousands)

Nine Months Ended May 31, 2012
Parent Guarantors Non-
Guarantors Eliminations Consolidated
Operating Activities

Net cash provided by operating activities
$ 56,851    $ 13,659    $ 58,804    $ —      $ 129,314
Investing Activities

Proceeds from sale of property, plant and equipment
2,100    137    6,249    —      8,486
Capital expenditures
(4,367 ) (2,797 ) (10,327 ) —      (17,491 )
Business acquisitions, net of cash acquired
(290 ) —      (29,444 ) —      (29,734 )

Cash used in investing activities
(2,557 ) (2,660 ) (33,522 ) —      (38,739 )
Financing Activities

Net repayments on revolving credit facilities
(57,990 ) —      (177 ) —      (58,167 )
Intercompany loan activity
(2,947 ) (10,999 ) 13,946    —      —
Principal repayments on term loan
(1,250 ) —      —      —      (1,250 )
Repurchases of 2% Convertible Notes
(102 ) —      —      —      (102 )
Proceeds on 5.625% Senior Note issuance
300,000    —      —      —      300,000
Redemption of 6.875% Senior Notes
(250,000 ) —      —      —      (250,000 )
Debt issuance costs
(5,340 ) —      —      —      (5,340 )
Purchase of treasury shares
(39,282 ) —      —      —      (39,282 )
Stock option exercises and related tax benefits
6,392    —      —      —      6,392
Cash dividends
(2,748 ) —      —      —      (2,748 )

Cash (used in) provided by financing activities
(53,267 ) (10,999 ) 13,769    —      (50,497 )
Effect of exchange rate changes on cash
—      —      (4,150 ) —      (4,150 )

Net increase in cash and cash equivalents
1,027    —      34,901    —      35,928
Cash and cash equivalents—beginning of period
872    —      43,349    —      44,221

Cash and cash equivalents—end of period
$ 1,899    $ —      $ 78,250    $ —      $ 80,149



	Nine Months Ended May 31, 2013
	Parent			Guarantors			Non-Guarantors			Eliminations		Consolidated
Operating Activities
Net cash provided by operating activities	$	61,900		$	28,192		$	26,178		$	—	$	116,270
Investing Activities
Proceeds from sale of property, plant and equipment	554			75			688			—		1,317
Proceeds from sale of business	—			—			4,854			—		4,854
Capital expenditures	(1,387		)	(3,461		)	(14,047		)	—		(18,895		)
Cash used in investing activities	(833		)	(3,386		)	(8,505		)	—		(12,724		)
Financing Activities
Principal repayments on term loan	(5,000		)	—			—			—		(5,000		)
Intercompany loan activity	(42,904		)	(24,897		)	67,801			—		—
Purchase of treasury shares	(13,670		)	—			—			—		(13,670		)
Stock option exercises and related tax benefits	18,705			—			—			—		18,705
Payment of contingent consideration	(1,350		)	—			(2,285		)	—		(3,635		)
Cash dividend	(2,911		)	—			—			—		(2,911		)
Cash provided by (used in) financing activities	(47,130		)	(24,897		)	65,516			—		(6,511		)
Effect of exchange rate changes on cash	—			—			(3,801		)	—		(3,801		)
Net increase (decrease) in cash and cash equivalents	13,937			(91		)	79,388			—		93,234
Cash and cash equivalents—beginning of period	12,401			91			55,692			—		68,184
Cash and cash equivalents—end of period	$	26,338		$	—		$	135,080		$	—	$	161,418

Table of Contents

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(In thousands)

Nine Months Ended May 31, 2011
Parent Guarantors Non-
Guarantors Eliminations Consolidated
Operating Activities

Net cash provided by (used in) operating activities
$ 15,423    $ (2,123 ) $ 83,331    $ (1,533 ) $ 95,098
Investing Activities

Proceeds from sale of property, plant and equipment
—      191    168    —      359
Proceeds from sale of businesses, net of transaction costs
—      —      3,463    —      3,463
Capital expenditures
(3,354 ) (3,537 ) (7,952 ) —      (14,843 )
Business acquisitions, net of cash acquired
—      (350 ) (159,697 ) —      (160,047 )

Cash used in investing activities
(3,354 ) (3,696 ) (164,018 ) —      (171,068 )
Financing Activities

Net borrowings on revolving credit facilities
—      —      14    —      14
Issuance of term loans
100,000    —      —      —      100,000
Intercompany loan activity
(95,141 ) 5,819    89,322    —      —
Repurchases of 2% Convertible Notes
(34 ) —      —      —      (34 )
Debt issuance costs
(5,197 ) —      —      —      (5,197 )
Stock option exercises and related tax benefits
7,285    —      —      —      7,285
Cash dividends
(2,716 ) —      (1,533 ) 1,533    (2,716 )

Cash provided by financing activities
4,197    5,819    87,803    1,533    99,352
Effect of exchange rate changes on cash
—      —      4,695    —      4,695

Net increase in cash and cash equivalents
16,266    —      11,811    —      28,077
Cash and cash equivalents—beginning of period
5,055    —      35,167    —      40,222

Cash and cash equivalents—end of period
$ 21,321    $ —      $ 46,978    $ —      $ 68,299



	Nine Months Ended May 31, 2012
	Parent			Guarantors			Non-Guarantors			Eliminations		Consolidated
Operating Activities
Net cash provided by operating activities	$	56,851		$	13,659		$	58,804		$	—	$	129,314
Investing Activities
Proceeds from sale of property, plant and equipment	2,100			137			6,249			—		8,486
Capital expenditures	(4,367		)	(2,797		)	(10,327		)	—		(17,491		)
Business acquisitions, net of cash acquired	—			—			(28,776		)	—		(28,776		)
Cash used in investing activities	(2,267		)	(2,660		)	(32,854		)	—		(37,781		)
Financing Activities
Net changes in borrowings on revolver and other debt	(57,990		)	—			(177		)	—		(58,167		)
Principal repayments of term loans	(1,250		)	—			—			—		(1,250		)
Intercompany loan activity	(2,947		)	(10,999		)	13,946			—		—
Repurchases of 2% Convertible Notes	(102		)	—			—			—		(102		)
Proceeds on 5.625% Senior Note issuance	300,000			—			—			—		300,000
Redemption of 6.875% Senior Notes	(250,000		)	—			—			—		(250,000		)
Debt issuance costs	(5,340		)	—			—			—		(5,340		)
Purchase of treasury shares	(39,282		)	—			—			—		(39,282		)
Stock option exercises and related tax benefits	6,392			—			—			—		6,392
Payment of contingent consideration	(290		)	—			(668		)	—		(958		)
Cash dividend	(2,748		)	—			—			—		(2,748		)
Cash provided by (used in) financing activities	(53,557		)	(10,999		)	13,101			—		(51,455		)
Effect of exchange rate changes on cash	—			—			(4,150		)	—		(4,150		)
Net increase in cash and cash equivalents	1,027			—			34,901			—		35,928
Cash and cash equivalents—beginning of period	872			—			43,349			—		44,221
Cash and cash equivalents—end of period	$	1,899		$	—		$	78,250		$	—	$	80,149

Table of Contents

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations

Actuant Corporation, headquartered in Menomonee Falls, Wisconsin, is a Wisconsin corporation incorporated in 1910. We are a global diversified company that designs, manufactures and distributes a broad range of industrial products and systems to various end markets. We are organized into ~~four~~three operating and reportable segments: Industrial, Energy ~~Electrical~~ and Engineered Solutions.

Our long-term goal is to grow annual diluted earnings per share (“EPS”), excluding unusual or non-recurring items, faster than most multi-industry peers. We intend to leverage our leading market positions to generate annual internal sales growth that exceeds the annual growth rates of the gross domestic product in the geographic regions in which we operate. In addition to internal sales growth, we are focused on acquiring complementary businesses. Following an acquisition, we seek to ~~drive cost reductions,~~ develop additional cross-selling opportunities, ~~and~~ deepen customer ~~relationships.~~relationships and leverage costs. We also focus on profit margin expansion and cash flow generation to achieve our financial and EPS growth goals. Our LEAD (“Lean Enterprise Across Disciplines”) process utilizes various continuous improvement techniques to drive out costs and improve efficiencies across all locations and functions worldwide, thereby expanding profit margins. Strong cash flow generation is achieved by maximizing returns on net assets and minimizing primary working capital needs. Our LEAD efforts also support our Growth + Innovation (“G+I”) initiative, a process focused on improving core sales growth. The cash flow that results from efficient asset management and improved profitability is primarily used to ~~reduce debt and~~ fund ~~additional~~strategic acquisitions, common stock repurchases and internal growth opportunities.

The comparability of the operating results for the three months and nine months ended May 31, 2012 to the comparable prior year periods has been impacted by acquisitions, changes in foreign currency translation rates and the economic conditions that exist in the end markets we serve. Listed below are the significant acquisitions completed since September 1, 2010.


~~Business~~	~~Segment~~	~~Acquisition Date~~
~~Turotest Medidores Ltda~~	~~Engineered Solutions~~	~~March 2012~~
~~Jeyco Pty Ltd.~~	~~Energy~~	~~February 2012~~
~~Weasler Engineering, Inc.~~	~~Engineered Solutions~~	~~June 2011~~
~~Mastervolt Intl. Holding B.V.~~	~~Electrical~~	~~December 2010~~

In addition to acquisitions, changes in foreign currency exchange rates also influence our financial results as approximately one-half of our sales are denominated in currencies other than the U.S. dollar. The year-over-year strengthening of the U.S. dollar during the first nine months of fiscal 2012 has negatively impacted our operating results due to the translation of non-U.S. dollar denominated results.

Our businesses provide a vast array of products and services across multiple customers ~~end markets~~ and geographies which results in significant diversification. ~~Since the global recession in 2009, the majority~~The long-term sales growth and profitability of our end markets have improved, the result of economic expansion, increased worldwide demand for energy, elevated industrial manufacturing activities and increased production of vehicles for the heavy-duty truck, construction, military and agricultural markets.

~~Our long-term growth~~segments will depend not only on ~~changes~~increased demand in end markets and the overall economic environment, but also on our ability to identify, consummate and integrate strategic acquisitions, develop and market innovative new products, expand our business activity geographically ~~(developing countries)~~ and continuously improve operational excellence. ~~We remain focused on maintaining~~

The comparability of operating results to the prior year has been impacted by changes in foreign currency exchange rates (as approximately one-half of our ~~financial strength by adjusting our cost structure to reflect any reduction~~sales are denominated in ~~market demand~~currencies other than the U.S. dollar), acquisitions, divestitures and ~~by proactively managing working capital and cash flow generation.~~

the generally weaker economic conditions that have persisted in the end markets we serve. Listed below are the acquisitions completed since September 1, 2011.



Business	Segment	Acquisition Date
CrossControl AB	Engineered Solutions	July 2012
Turotest Medidores Ltda	Engineered Solutions	March 2012
Jeyco Pty Ltd	Energy	February 2012

Results of Operations

~~Core sales growth~~

The continued weakness and uncertainty in the ~~Industrial segment~~global economy has ~~recently moderated from previous quarters, primarily due to tougher prior year comparables. Overall we continue to experience strong industrial demand across most end markets and robust activity~~created a challenging environment for customized high force hydraulic systems (integrated solutions). During fiscal 2012, the Energy segment has consistently delivered double digit core sales growth as certain oil & gas end markets continue to show strength. This improvedour businesses. Most of our businesses have experienced weak end market demand over the past several quarters relative to expansion in the last few years. We have continued to invest in select growth initiatives over the past year, while simultaneously reducing costs in other areas to generate shareholder value. Our second half operating results in fiscal 2013 should improve over the first half as cost reduction benefits and ~~emerging market opportunities~~the benefit of growth investments are ~~expected to~~realized. We continue to ~~drive core sales~~focus on cash flow generation which will fuel future growth through acquisitions and ~~operating profit margin expansion during~~G+I investments. While we have not completed any acquisitions this fiscal year, we have spent considerable efforts in that area and expect to complete acquisitions in the ~~remainder~~future.

Our results of the fiscal year. While end market demand in our Electrical segment has not fully recovered from the depressed levels during the global economic recession, the segment generated solid core sales growth inoperations for the first nine months of fiscal ~~2012 –~~2013 reflect lower sales, excluding the impact of acquisitions and changes in foreign exchange rates ("core sales"), the result of ~~price increases~~the European recession, inventory destocking by OEMs (construction equipment and ~~recent improved demand for electrical products~~off-highway customers) and general economic weakness. Despite these challenges, two of our three segments achieved positive core sales growth in the ~~utility, OEM, solar and retail DIY channels. Finally, we expect continued core sales declines~~third quarter. We continue to focus on taking appropriate actions to align our cost structure with end market demand, while prioritizing investments in the Engineered Solutions segment during the balance of the fiscal year, as a result of more difficult prior year comparables and weaker European auto and global truck OEM production schedules. On a consolidated basis, our Growth + Innovation initiatives and recent acquisitions are expected to provide significant growth opportunities ~~diversify~~across our broad product offerings and ~~expand our~~ geographic ~~presence.~~

scope.

Table of Contents

The following table sets forth our results of operations (in ~~millions)~~millions, except per share amounts):

   Three Months Ended May 31, Nine Months Ended May 31,
   2012    2011    2012    2011
Net sales
   $ 429       100 % $ 393       100 % $ 1,200       100 % $ 1,042       100 %
Cost of products sold
   263       61 % 239       61 % 740       62 % 641       62 %









Gross profit
   166       39 % 154       39 % 460       38 % 401       38 %
Selling, administrative and engineering expenses
   91       21 % 89       23 % 264       22 % 244       23 %
Amortization of intangible assets
   7       2 % 7       2 % 22       2 % 20       2 %









Operating profit
   68       16 % 58       15 % 174       15 % 137       13 %
Financing costs, net
   7       2 % 8       2 % 23       2 % 24       2 %
Debt refinancing charges
   17       4 % —         0 % 17       1 % —         0 %
Other expense, net
   3       1 % 1       0 % 3       0 % 1       0 %









Earnings before income tax expense
   41       10 % 49       12 % 131       11 % 112       11 %
Income tax expense
   7       2 % 11       3 % 27       2 % 25       2 %









Earnings from continuing operations
   $ 34       8 % $ 38       10 % $ 104       9 % $ 87       8 %

~~Net~~



	Three Months Ended									Nine Months Ended
	May 31, 2013					May 31, 2012				May 31, 2013					May 31, 2012
Net sales	$	344		100	%	$	343	100	%	$	952		100	%	$	954	100	%
Cost of products sold	207			60	%	204		59	%	575			60	%	572		60	%
Gross profit	137			40	%	139		41	%	377			40	%	382		40	%
Selling, administrative and engineering expenses	74			22	%	74		22	%	223			23	%	211		22	%
Amortization of intangible assets	6			2	%	6		2	%	17			2	%	16		2	%
Operating profit	57			16	%	59		17	%	137			15	%	155		16	%
Financing costs, net	6			2	%	7		2	%	19			2	%	23		2	%
Debt refinancing costs	—			—	%	17		5	%	—			—	%	17		2	%
Other expense, net	1			0	%	3		1	%	1			0	%	4		0	%
Earnings from continuing operations before income tax expense	50			14	%	32		9	%	117			13	%	111		12	%
Income tax expense	4			1	%	4		1	%	15			2	%	22		2	%
Earnings from continuing operations	46			13	%	28		8	%	102			11	%	89		10	%
Earnings (loss) from discontinued operations, net of income taxes	(139		)	(40	)%	6		2	%	(130		)	(14	)%	15		1	%
Net earnings (loss)	$	(93	)	(27	)%	$	34	10	%	$	(28	)	(3	)%	$	104	11	%


Diluted earnings from continuing operations per share	$	0.62				$	0.36			$	1.38				$	1.19
Diluted earnings (loss) per share	$	(1.24	)			$	0.45			$	(0.38	)			$	1.39

Consolidated sales ~~increased 9% to $429 million~~ for the third quarter of fiscal 2013 were $344 million compared to $343 million in the comparable prior year period. Core sales declined 2%, while acquisitions added 3% to net sales and ~~15% to $1,200~~currency translation reduced sales by 1%. On a year-to-date basis, sales of $952 million were essentially unchanged from the $954 million in the comparable prior year period. Excluding the 5% impact of acquisitions and 1% negative impact from foreign currency translation, year-to-date core sales declined 4%. Operating profit for the ~~nine months ended May 31, 2012 compared to $393 million and $1,042 million for the comparable~~ three and nine month periods ended May 31, 2013 was $57 million and $137 million, respectively, compared to $59 million and $155 million, in the comparable prior year periods. Unfavorable product mix, a favorable adjustment to an acquisition earn-out provision in the prior ~~year. Changes~~year and investments in ~~foreign currency exchange rates (most notably~~growth initiatives drove this modest year-over-year decline in operating profit. We were able to offset this with lower borrowing costs and a reduced effective tax rate. Results for the ~~Euro) had a $12~~third quarter of fiscal 2012 also included pre-tax debt refinancing costs of $17 million, or $0.15 per diluted share. Fiscal 2013 third quarter net earnings and earnings per share from continuing operations were $46 million and ~~$8 million unfavorable impact on third quarter and year-to-date sales comparisons, respectively. Sales generated by businesses acquired since September 1, 2010, were $32 million and $139 million,~~$0.62, respectively (a 22% increase year-over-year, excluding debt refinancing costs) while net earnings from continuing operations for the ~~three and~~ nine ~~months~~month period ended May 31, ~~2012. Consolidated core sales growth (growth~~2013 were $102 million, or $1.38 per diluted share (3% higher than the prior year, excluding ~~the effects~~debt refinancing costs).

Table of foreign exchange and acquisitions) was 4% and 6% on a quarterly and year-to-date basis, respectively, the result of broad based improvement in most of the Company’s served markets. Consolidated operating profit margins expanded in both the third quarter and year-to-date, the result of an improved cost structure, favorable product mix, selective price increases, reduced incentive compensation costs and improved operating leverage on the higher sales volumes. The changes in sales and operating profit at the segment level are discussed in further detail below.

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Segment Results (in millions)

Industrial Segment

The Industrial segment is primarily involved in the design, manufacture and distribution of branded hydraulic and mechanical tools tothat are used in maintenance and other applications in the ~~maintenance,~~ industrial, energy, infrastructure and production automation markets. ~~During the third quarter of fiscal 2012, the segment generated core sales growth as certain end markets (mining, industrial, infrastructure) continued to show strength.~~ The Industrial segment focuses primarily on ensuring safety, improving uptime in maintenance and providing customers with ~~innovative integrated solutions, commercializing~~highly engineered heavy lifting solutions. The growth strategy for this segment includes a combination of new products, increased share in certain high growth vertical markets and ~~expanding~~geographic expansion. Weak economic activity in ~~faster growing regions~~the global industrial markets is expected to continue and ~~vertical markets.~~will likely result in modest growth during the remainder of the fiscal year. The following table sets forth the results of operations for the Industrial segment (in millions):

   Three Months Ended May 31, Nine Months Ended May 31,
   2012 2011 2012 2011
Net sales
   $ 110    $ 108    $ 309    $ 284
Operating profit
   31    30    85    70
Operating profit %
   28 % 27 % 28 % 25 %



	Three Months Ended						Nine Months Ended
	May 31, 2013			May 31, 2012			May 31, 2013			May 31, 2012
Net sales	$	111		$	110		$	311		$	309
Operating profit	32			31			86			85
Operating profit %	29		%	28		%	28		%	28		%

Fiscal ~~2012~~ 2013 third quarter net sales increased $2$1 million ~~(2%~~ (1%) to ~~$110~~$111 million compared to the prior year period, ~~while~~similar to the 1% year-to-date net sales ~~increased $25~~increase to $311 million ~~(9%) to $309 million. Changes~~. Excluding the minor impact of changes in foreign currency exchange rates, ~~negatively impacted~~core sales comparisons by $3 million and $2 million for the three and nine month periods, respectively. Core sales growth was 5% for the third quarter and 9% year-to-date, driven by strong demand across our served end markets and geographies. These increased sales volumes, favorable product mix and lower incentive compensation costs resultedgrew 2% in ~~operating profit margin expansion during~~ both the third quarter and on a year-to-date basis. ~~Industrial segment operating~~Despite overall economic weakness, tough prior year comparables and reduced industrial tool demand in Europe due to weak economic conditions, core sales grew modestly as a result of market share gains and higher global Integrated Solutions infrastructure project sales. Operating profit ~~increased for the three and nine months ended May 31, 2012~~margin improved due to productivity improvements, slightly higher sales, as well as lower incentive compensation expense, which were somewhat offset by ~~$1 million (4%) and $15 million (22%), respectively.~~

unfavorable product mix.

Energy Segment

The Energy segment provides joint integrity products and services, as well as rope and cable solutions toprimarily used in maintenance activities in the global ~~oil & gas, power generation and other~~ energy ~~markets. Being a later cycle business, our Energy segment was the last of our four segments to recover from the global recession.~~market. Worldwide requirements for energy and supportive oil prices ~~have encouraged~~continue to drive customers and asset owners to maintain production at existing installations, as well as invest in ~~capital projects or complete previously deferred maintenance activities. As a result, we are seeing broad-based strength across~~exploration and new production facilities. The non-energy markets served by this segment (including defense, marine and aerospace) continue to experience softening demand, which ~~has delivered five consecutive quarters of double digit core sales growth.~~is expected to continue for the next several quarters. The following table sets forth the results of operations for the Energy segment (in millions):

   Three Months Ended May 31, Nine Months Ended May 31,
   2012 2011 2012 2011
Net sales
   $ 96    $ 78    $ 256    $ 210
Operating profit
   19    14    43    32
Operating profit %
   19 % 17 % 17 % 15 %



	Three Months Ended						Nine Months Ended
	May 31, 2013			May 31, 2012			May 31, 2013			May 31, 2012
Net sales	$	99		$	96		$	271		$	256
Operating profit	20			19			45			43
Operating profit %	20		%	19		%	17		%	17		%

Compared to the prior year, Energy segment third quarter net sales increased $3 million (3%) to $99 million in fiscal 2013 and $15 million (6%) to $271 million on a fiscal year-to-date basis. Excluding the impact of changes in foreign currency exchange rates, core sales increased 5% in the third quarter and 2% on a year-to-date basis, due to an increase in activity in the seismic, diving and oil & gas (maintenance spending) markets. Excluding a $3 million favorable adjustment to an acquisition earn out provision in the prior year, third quarter and year-to-date operating profit margin improved as a result of increased operating leverage (driven by higher sales volumes), favorable product mix and lower incentive compensation costs.

Engineered Solutions Segment

The Engineered Solutions segment provides highly engineered position and motion control, power transmission and instrumentation and display systems to OEMs in a variety of markets. This segment continued to experience core sales declines in the third quarter as a result of weak European demand attributable to the economy and global OEM destocking. The fourth quarter is expected to deliver sequentially improved sales levels as destocking activity at OEMs has shown signs of abatement, along with easier year-over-year comparables. This segment continues to focus on the integration of fiscal 2012 acquisitions and reducing cost to match demand. The following table sets forth the results of operations for the Engineered Solutions segment (in millions):

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	Three Months Ended						Nine Months Ended
	May 31, 2013			May 31, 2012			May 31, 2013			May 31, 2012
Net sales	$	134		$	137		$	370		$	390
Operating profit	13			18			29			51
Operating profit %	10		%	14		%	8		%	13		%

Compared to the prior year, Engineered Solutions segment net sales ~~for~~decreased $3 million (2%) to $134 million and $19 million (5%) to $370 million in the three and nine months ended May 31, ~~2012 increased $18 million (24%)~~2013, respectively. Excluding foreign currency rate changes and ~~$46 million (22%), respectively, compared to the prior year periods. Excluding~~ sales from the recently completed Jeyco acquisition and the impact of foreign currency exchange rates (which unfavorably impacted sales comparisons by $2 million and $1 million in the current quarter and year-to-date periods, respectively),acquired businesses, core sales ~~grew 23%~~declined 10% and ~~21%, respectively~~13% in the three and nine months ended May 31, ~~2012. Core~~2013, respectively. The core sales ~~growth reflects higher activity levels~~decline was broad based across ~~the segment’s diverse~~most served end markets ~~including maintenance spending in oil & gas, strong sales to the North American power generation (nuclear) market~~ and ~~capital project activity in offshore energy. Energy~~geographies and primarily reflected challenging economic conditions and OEM inventory destocking. Year-to-date segment operating profit ~~increased by $5~~declined as the impact of reduced volume and $2 million ~~(37%)~~of restructuring costs more than offset lower incentive compensation costs.

General Corporate

General corporate expenses were $8 million and $22 million for the three and nine months ended May 31, 2013, respectively and $9 million and $25 million for the three and nine months ended May 31, 2012, respectively. Lower corporate expenses are primarily due to ~~$19~~reduced incentive compensation provisions.

Financing Costs, net

All debt is considered to be for general corporate purposes and therefore financing costs have not been allocated to our segments. Net financing costs were $6 million and $19 million for the three and nine months ended May 31, 2013, respectively and $7 million and $23 million, respectively, for the comparable prior year periods. The reduction in interest expense in fiscal 2013 reflects the conversion of our 2% Convertible Notes into common stock, as well as the benefit of lower borrowing costs from the refinancing of our Senior Notes (both completed in the third quarter of fiscal 2012).

Income Taxes Expense

The effective income tax rate from continuing operations was 7.7% and 12.5% for the three and nine months ended May 31, 2013, respectively, and 13.8% and 19.8% for the comparable prior year periods. The decrease in the effective tax rate relative to the prior year, reflects the benefits of tax minimization planning, the utilization of net operating losses and discrete items. Income tax expense for the third quarter ~~compared~~of fiscal 2013 included discrete period income tax benefits related to provision to income tax return adjustments of $0.7 million and a ~~year-to-date increase~~$9.3 million reversal of ~~$11~~tax reserves established in prior years (as a result of the lapsing of non-U.S. income tax statues of limitations), while the prior year period included a $6.3 million (35%) to $43 million. Improved year-to-date operating profit margins were driven by continued productivity improvements, increased operating leverage (driven by higher sales volumes) as well as a favorable adjustment to an acquisition earn-out provision.

~~Electrical Segment~~discrete income tax benefit associated with the debt refinancing.

Discontinued Operations

The Electrical segment is primarily involved in the design, manufacture and distribution of a broad range of electrical products to the retail DIY, wholesale, OEM, solar, utility, marine and other harsh environment markets. The Mastervolt business was acquired in December 2010 and is comprised of two product lines, solar and marine. During the fourth quarter of fiscal 2012 we recognized a non-cash impairment charge of $62.5 million related to the Mastervolt reporting unit. A subsequent $170.3 million impairment charge was recorded in the third quarter of fiscal 2013, as a result of the subsequent decision to divest the entire Electrical segment.

Since its acquisition in fiscal 2010, financial results for Mastervolt have been volatile, attributable to challenging business and market conditions, regulatory changes and very weak European economic conditions. Substantially all of Mastervolt's solar sales are in Europe. Solar demand has been adversely impacted by weak European economic conditions, government credit and budget challenges and the resulting austerity actions that have impacted solar subsidies, consumer confidence and access to credit. As a result of financial challenges facing European governments, significant reductions were made to solar feed in tariff (“FiT”) incentives, which increased the volatility of solar demand, and made investments in solar systems less attractive to potential buyers. Reduced FiT's unfavorably impact our customers' return on investment in solar systems, thereby creating downward pressure on solar inverter pricing. During the fourth quarter of fiscal 2012, reduced incentive schemes were announced and implemented in Mastervolt's key served markets (United Kingdom, France, Belgium, Germany and Italy). The combination of all of these factors has reduced Mastervolt's solar sales and margins. This necessitated several actions, including negotiating lower product cost from Mastervolt's suppliers, increasing our efforts to reduce solar inventory levels, initiating management changes, narrowing the focus of the solar business to certain key markets and product lines and reducing overhead through facility closures and headcount reductions.

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Mastervolt generated $73.3 million in sales and $3.7 million in operating profit for the 2012 fiscal year, excluding the $62.5 million fourth quarter non-cash impairment charge. Despite the year-over-year improvement in operating results of the Mastervolt business in the second half of fiscal 2012 (relative to operating losses in the prior year comparable periods) the business continued to underperform relative to expectations due to its solar product line. While we believe the solar industry will continue to grow, we reduced Mastervolt's long-term sales and profitability expectations as a result of continued pricing pressure, the frequent imbalance between solar industry inverter supply and demand (resulting in excess inventory) and the volatile nature of end market demand given frequent unfavorable FiT changes. We also reviewed the long-term strategic fit of the Mastervolt business in the fourth quarter, as part of our annual strategic plan and portfolio management process. Various actions to address the Mastervolt business, and the solar product line in particular, were considered, including continuing to operate and invest in the business, implementing significant restructuring and downsizing actions or exiting the entire business or the solar product line through a possible closure or sale. The adverse business, economic and competitive factors, coupled with the uncertainty regarding the long-term strategic fit of the business, resulted in a $62.5 million impairment charge during the fourth quarter of fiscal 2012. This consisted of the write-down of $36.6 million of goodwill and $25.9 million of indefinite lived intangible assets (tradename). The remaining carrying value of the Mastervolt business was $86.8 million at August 31, 2012 (including $2.5 million of net tangible assets and $84.4 million of intangible assets, goodwill and deferred income taxes).

During the first half of fiscal 2013, we initiated additional restructuring actions including headcount reductions and facility closures in the Electrical segment ~~delivered double digit~~to respond to weak overall demand and negative year-over-year core sales growth asfor the segment. Following additional portfolio management discussions, we committed to a plan to divest the entire Electrical segment in May 2013. We have engaged an investment bank to assist in the sale process and believe that a sale will be completed within the next twelve months, subject to terms that are usual and customary for the sale of a business. The divestiture will allow us to streamline our strategy and refocus on the remaining three segments in a way that better positions the Company to take advantage of our core competencies, current business model and global growth trends. As a result, we recognized an impairment charge during the third quarter of fiscal 2013 of $170.3 million ($149.8 million net of tax), including a write-down of $137.8 million of goodwill, $21.3 million of indefinite lived intangible assets (tradename) and $11.2 million of amortizable intangible assets. The impairment charge represents the excess of the net book value of the held for sale assets over the estimated fair value, less selling costs. As a result of the impairment charge, there is no remaining goodwill associated with the Mastervolt reporting unit and $76.9 million of remaining North American ~~end markets (utility, DIY, wholesale and OEM) continued~~Electrical goodwill. Refer to ~~recover from recessionary lows and activity levels in European solar markets improved. Future results~~Note 3, “Discontinued Operations” for information regarding the carrying value of the Electrical segment will continue to be impacted by fluctuations in commodity costs, the realization of price increases, changes in European solar feed-in tariffs and end market demand in North America. assets held for sale.

The ~~following table sets forth the~~ results of operations for the Electrical segment ~~(in millions):~~

   Three Months Ended May 31, Nine Months Ended May 31,
   2012 2011 2012 2011
Net sales
   $ 86    $ 80    $ 246    $ 206
Operating profit
   9    5    20    14
Operating profit %
   10 % 7 % 8 % 7 %

Fiscal 2012 third quarter Electrical segment net sales increased $6 million (7%) to $86 million. Excluding the $2 million unfavorable impact of changes in foreign currency exchange rates, core sales growth was 10%, the result of price increases and higher sales volumes in the retail, industrial, utility and solar markets. Electrical segment net saleshave been reported as discontinued operations for the nine months ended May 31, 2012 were $246 million, a $40 million (19%) improvement over the prior year period. Excluding sales from the Mastervolt acquisition and changes in foreign currency exchange rates, core sales growth for the nine months ended May 31, 2012 was 8%. Electrical segment operating profit for the three and nine months ended May 31, 2012 was $9 million and $20 million, respectively. Despite unfavorable acquisition mix, higher incentive compensation costs and $0.5 million of restructuring costs associated with plant closures, quarterly operating profit increased due to higher sales volumes and favorable product mix.

~~Engineered Solutions Segment~~

The Engineered Solutions segment provides highly engineered position and motion control systems to OEMs in a variety of markets. As expected, this segment experienced a core sales decline in the third quarter, reflecting lower production rates by European and China truck OEMs, as well as automotive OEMs. However, most other end markets are seeing increased sales levels, including strong demand from the global agriculture and North American truck and construction equipment end markets. The recent Weasler and Turotest acquisitions have provided sales and earnings growth opportunities for the segment, by expanding into new markets (primarily in the North American, European and Brazilian agricultural markets).all periods presented. The following table ~~sets forth~~summarizes the results of discontinued operations ~~for the Engineered Solutions segment~~ (in millions):

   Three Months Ended May 31, Nine Months Ended May 31,
   2012 2011 2012 2011
Net sales
   $ 137    $ 127    $ 390    $ 342
Operating profit
   19    20    51    47
Operating profit %
   14 % 16 % 13 % 14 %

~~Engineered Solutions segment third quarter net sales increased $10 million (8%) from $127 million in~~



	Three Months Ended						Nine Months Ended
	May 31, 2013			May 31, 2012			May 31, 2013			May 31, 2012
Net Sales	$	75		$	86		$	214		$	246

Operating income from divested businesses	12			9			25			20
Impairment charge	(170		)	—			(170		)	—
Income tax benefit (expense)	19			(2		)	14			(6		)
Income (loss) from discontinued operations, net of taxes	$	(139	)	$	7		$	(131	)	$	14

Refer to “Critical Accounting Policies” within Management's Discussion and Analysis (below) for further information on the prior year to $137 million in fiscal 2012. During the nine months ended May 31, 2012, year-over-year net sales increased $48 million (14%) to $390 million. Excluding foreign currency rate changes and sales from acquired businesses, core sales declined 11%, and 7% respectively, for the third quarter and first nine months of fiscal 2012. The impact of sales from acquired businesses was $29 million and $77 million in the three and nine months ended May 31, 2012, respectively. The decline in core sales was due to a reduction in OEM production schedules for convertible auto as well as China and European heavy-duty trucks. Segment operating profit declined from the prior year periods as the impact of the reduced volumeimpairment charges and related ~~under-absorption~~estimates.

Table of ~~operating costs was only partially offset by lower incentive compensation costs and favorable segment mix.~~

~~General Corporate~~

General corporate expenses for the three and nine months ended May 31, 2012 were $9 million and $25 million compared to $11 million and $27 million in the comparable prior year periods. Corporate expenses declined due to reduced incentive compensation costs and lower idle facility holding costs, offset by increased Growth + Innovation expenditures.

~~Financing Costs, net~~

All debt is considered to be for general corporate purposes and therefore financing costs have not been allocated to our segments. Financing costs, net declined modestly year-over-year due to lower interest rates and amounts outstanding under the Company’s credit facility.

~~Debt Refinancing Charges~~

During the three months ended May 31, 2012, the Company recognized a $17 million debt refinancing charge, which included $10 million of tender premium paid to holders of existing 6.875% Senior Notes, a $2 million write-off of deferred financing fees and debt discount and a $4 million charge related to the termination of the interest rate swap agreements.

~~Income Tax Expense~~

Our effective income tax rate was 16.1% and 20.9% for the three and nine months ended May 31, 2012, respectively, and 23.0% and 22.0% for the comparable prior year periods. The year-over-year decline resulted from increased utilization of foreign tax credits, favorable tax reserve adjustments as a result of the lapsing of various tax statutes of limitations, the utilization of net operating losses and the tax benefit on the debt refinancing charges (Note 7, “Debt”) being recognized at the U.S. statutory rates (which are higher than the Company’s consolidated global effective tax rate).

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Cash Flows

The following table summarizes the cash flows from operating, investing and financing activities (in millions):

   Nine Months Ended May 31,
   2012 2011
Net cash provided by operating activities
   $ 129    $ 95
Net cash used in investing activities
   (39 ) (171 )
Net cash (used in) provided by financing activities
   (50 ) 99
Effect of exchange rates on cash
   (4 ) 5


Net increase in cash and cash equivalents
   $ 36    $ 28



	Nine Months Ended
	May 31, 2013			May 31, 2012
Net cash provided by operating activities	$	116		$	129
Net cash used in investing activities	(13		)	(38		)
Net cash used in financing activities	(6		)	(51		)
Effect of exchange rates on cash	(4		)	(4		)
Net increase in cash and cash equivalents	$	93		$	36

Cash flows from operating activities during the nine months ended May 31, 2013 were $116 million, primarily consisting of net earnings, offset by the payment of $17 million of fiscal 2012 incentive compensation costs and an increase in working capital accounts. Investing activities during fiscal 2013 included $19 million of net capital expenditures and the receipt of $5 million in proceeds related to the divestiture of the Nielsen Sessions business. Existing cash, coupled with operating cash flows and proceeds and benefits of share based compensation, funded the repurchase of approximately 0.5 million shares of the Company’s common stock ($14 million) under the stock buyback program, the annual dividend and $5 million of scheduled payments on the term loan.

Cash flows from operating activities during the nine months ended May 31, 2012 were ~~$129~~$129 million, the result of net earnings offset by the ~~$28~~$28 million payment of fiscal 2011 incentive compensation costs, $15 million use of cash related to the debt refinancing transactions and increased working capital requirements. This operating cash flow and the proceeds from the third quarter debt refinancing funded $39 million of treasury stock purchases, $30 million of capital deployed for acquisitions and the repayment of revolving credit facility borrowings. Proceeds from the sale of property, plant and equipment (which included the sale-leaseback of certain equipment and the sale of a vacant facility) were $8 million, while related capital expenditures were $17 million.

As described in Note 7, “Debt” we refinanced a portion of our long-term debt at lower interest rates and reduced overall indebtedness with the conversion of our $117 million of 2% Convertible Notes into shares of common stock. These actions will reduce our future financing costs and improve our capital structure.

~~In the first nine months of fiscal 2011 we utilized the cash provided from operating activities and new borrowings under our Senior Credit Facility to fund the $158 million acquisition of Mastervolt.~~

Primary Working Capital Management

from Continuing Operations

We use primary working capital as a percentage of sales (PWC %) as a key indicator of working capital ~~management efficiency.~~management. We define this metric as the sum of net accounts receivable and net inventory less accounts payable, divided by the past three months sales annualized. The following table shows the components of the metric at (in millions):

   May 31, 2012 PWC% May 31, 2011 PWC%
Accounts receivable, net
   $ 238    14 % $ 234    15 %
Inventory, net
   206    12 % 213    14 %
Accounts payable
   (168 ) -10 % (172 ) -11 %


Net primary working capital
   $ 276    16 % $ 275    18 %

~~Improved working capital management drove a reduction in our PWC % despite a growth in sales and contributed to favorable current year cash flow from operating activities.~~



	May 31, 2013			PWC%		May 31, 2012			PWC%
Accounts receivable, net	$	215		16	%	$	192		14	%
Inventory, net	145			11	%	148			11	%
Accounts payable	(148		)	(11	)%	(147		)	(11	)%
Net primary working capital	$	212		16	%	$	193		14	%

Liquidity

~~Liquidity~~

Our Senior Credit Facility, which matures on February 23, 2016, includes a ~~$600~~$600 million revolving credit ~~facility,~~line, a ~~$100~~$100 million term loan and a ~~$300~~$300 million expansion ~~option.~~option, subject to certain conditions. Quarterly principal payments of ~~$1.25~~$1.25 million began on the ~~$100 million~~ term loan on March 31, 2012, increasing to ~~$2.5~~$2.5 million per quarter beginning on March 31, 2013, with the remaining principal due at maturity. At May 31, ~~2012,~~2013, we had ~~$80~~$161 million of cash and cash equivalents and ~~$598~~$597 million of available liquidity under our Senior Credit Facility. ~~Our scheduled debt repayments over~~See Note 7, “Debt” for further discussion on the ~~next three years aggregated approximate $30 million, providing substantial flexibility.~~Senior Credit Facility. We believe that ~~the~~ availability under the Senior Credit Facility, combined with our existing cash on hand and funds generated from operations will be adequate to meet operating, debt service, stock buyback, acquisition funding and capital expenditure requirements for the foreseeable future.

Commitments and Contingencies

~~We lease certain~~

The Company has facilities ~~computers, equipment~~in numerous geographic locations that are subject to a range of environmental laws and ~~vehicles under various operating lease agreements, generally~~regulations. Environmental expenditures over ~~periods from one to twenty years. Under most arrangements, we pay~~ the ~~property taxes, insurance, maintenance and expenses related to the leased property. Many of the leases include provisions~~past two years have not been material. Management believes that ~~enable us to renew the lease based upon fair value rental rates~~such costs will not have a material adverse effect on the ~~date~~Company’s financial position, results of ~~expiration~~operations or cash flows.

Table of ~~the initial lease.~~

In the normal course of business we have entered into certain real estate and equipment leases or have guaranteed such leases on behalf of our subsidiaries. In conjunction with the spin-off of a former subsidiary in fiscal 2000, we assigned our rights in the leases used by the former subsidiary, but were not released as a responsible party from all such leases by the lessors. All of these businesses were subsequently sold. We remainContents

The Company remains contingently liable for ~~those~~lease payments under leases ~~if any~~ of ~~these~~businesses that it previously divested or spun-off, in the event that such businesses are unable to fulfill their ~~obligations thereunder.~~future lease payment obligations. The discounted present value of future minimum lease payments for these leases was ~~$3.7~~$12 million at May 31, ~~2012.~~

2013.

We had outstanding letters of credit of approximately $8$11 million and $9$9 million at May 31, ~~2012~~2013 and August 31, ~~2011,~~2012, respectively, the majority of which secure self-insured workers compensation liabilities.

Contractual Obligations

Our contractual obligations are discussed in Part 1, Item 7 , “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the heading “Contractual Obligations” in our Annual Report on Form 10-K for the year ended August 31, ~~2011. Our contractual obligations~~2012, and, as of May 31, 2013, have not materially ~~changed since that report was filed, except with respect to debt maturities. As discussed in Note 7, “Debt” in the notes to the condensed~~changed.

Critical Accounting Policies

We prepare our consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”). This requires management to make estimates and assumptions that affect reported amounts and related disclosures. Actual results could differ from those estimates. Refer to our Annual Report on Form 10-K and the following information for policies that are considered by management to be the most critical in understanding the judgments that are involved in the preparation of our consolidated financial statements and the uncertainties that could impact our results of operations, financial position and cash flows.

Goodwill and Long-Lived Assets - Annual Impairment Review, Estimates and Sensitivity: Our business acquisitions typically result in recording goodwill and other intangible assets, which are a significant portion of our total assets. On an annual basis, or more frequently if triggering events occur, we compare the estimated fair value of our nine reporting units to the carrying value to determine if a potential goodwill impairment exists. If the fair value of a reporting unit is less than its carrying value, an impairment loss, if any, is recorded for the difference between the implied fair value and the carrying value of the reporting unit's goodwill. The estimated fair value represents the amount at which a reporting unit could be bought or sold in a current transaction between willing parties on an arms-length basis.

In estimating the fair value, we generally use a discounted cash flow model, which is dependent on a number of assumptions including estimated future revenues and expenses, weighted average cost of capital, capital expenditures and other variables. The expected future revenue growth rates and operating profit margins are determined after taking into consideration our historical revenue growth rates and earnings levels, our assessment of future market potential and our expectations of future business performance. Under the discounted cash flow approach, the fair value is calculated as the sum of the projected discounted cash flows over a discrete seven year period plus an estimated terminal value. In certain circumstances we also review a market approach in which a trading multiple is applied to a forecasted EBITDA (earnings before interest, income taxes, depreciation and amortization) of the reporting unit to arrive at the estimated fair value.

Our fourth quarter fiscal 2012 impairment calculations included one reporting unit (Mastervolt) in which the carrying value exceeded the estimated fair value (see discussion on Fiscal 2012 Impairment Charge) and one reporting unit (North American Electrical) that had an estimated fair value that exceeded its carrying value by 13%. The carrying value of the North American Electrical reporting unit was $254.2 million at August 31, 2012, including $173.9 million of goodwill from previously completed acquisitions. Key financial assumptions utilized to determine the fair value of the North American Electrical reporting unit included single digit sales growth (including 3% in the terminal year) and a 12.9% discount rate. The estimated cash flows assumed improved profitability (relative to actual fiscal 2012 results) - driven by savings and efficiencies from the consolidation of manufacturing facilities, which was completed in late fiscal 2012. The assumptions that have the most significant impact on the determination of the fair value of the reporting unit are market valuation multiples, the discount rate and sales growth rates. A 100 basis point increase in the discount rate results in a decrease to the estimated fair value by approximately 9%, while a reduction in the terminal year sales growth rate assumption by 100 basis points would decrease the estimated fair value by approximately 5%. For the remaining seven reporting units, our annual goodwill impairment testing in fiscal 2012 indicated that the estimated fair value of each reporting unit exceeded the carrying value (expressed as a percentage of the carrying value) in excess of 30%.

A considerable amount of management judgment and assumptions are required in performing the impairment tests, principally in determining the fair value of each reporting unit and the indefinite lived intangible assets. While we believe our judgments and assumptions are reasonable, different assumptions could change the estimated fair values and, therefore, impairment charges could be required. Significant negative industry or economic trends, disruptions to the Company's business, loss of significant customers, inability to effectively integrate acquired businesses, unexpected significant changes or planned changes in use of the assets or in entity structure and divestitures may adversely impact the assumptions used in the valuations and ultimately result in future impairment charges.

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Fiscal 2012 Impairment Charge: As a result of the uncertainty regarding the long-term strategic fit of the Mastervolt business (a “triggering event” in the fourth quarter), the fiscal 2012 Mastervolt goodwill impairment test utilized both market and income valuation approaches under various scenarios, which were weighted based on the probability of future outcomes, as a single discounted cash flow model with a holding period into perpetuity was no longer appropriate. Key assumptions included market multiples, a higher discount rate (16.6%) relative to our remaining reporting units and the expectation of continued positive cash flows in future years. Financial projections also assumed moderate sales growth in the marine market and a projected rebound in solar sales levels in fiscal 2013, with single digit annual sales growth in future years. The prior Mastervolt valuation was determined solely based on an income valuation approach and utilized a consistent discount rate, terminal year growth rate (3%) and expected long-term profit margin assumption. However, sales and cash flow projections during the discrete projection period in the fiscal 2012 impairment calculation were reduced by approximately 50% (relative to prior assumptions). The assumptions that have the most significant impact on the determination of the fair value of the reporting unit are market valuation multiples, the discount rate and sales growth rates. A 100 basis point increase in the discount rate results in a decrease to the estimated fair value by approximately 7%, while a reduction in the terminal year sales growth rate assumption by 100 basis points would decrease the estimated fair value by approximately 4%. While we use the best available information to prepare the cash flow assumptions, actual future cash flows or market conditions could differ, resulting in future impairment charges related to goodwill.

Fiscal 2013 Interim Impairment Charge: The material changes in assumptions from the fourth quarter fiscal 2012 impairment tests to third quarter fiscal 2013 Mastervolt and North American Electrical impairment tests were principally reduced market valuation multiples by approximately 20% (as updated information regarding potential buyers, M&A market conditions and multiples of comparable transactions supported a lower valuation) and lower projected sales volumes, which adversely impacted margin and cash flow assumptions. Uncertainty regarding the long-term growth prospects of the solar market, given its volatile nature and recent industry consolidations/exits by suppliers, also negatively impacted market multiple assumptions (consistent with declining valuations of other public solar companies). Our decision to divest the Electrical segment in May 2013 also impacted the impairment calculations, shortening the holding period of the businesses and placing more weighting on the market approach to determine the fair value of the reporting units.

While the Mastervolt marine product line has generated sales growth in fiscal 2013, the continued volatility in the solar market, reduced government solar incentives to buyers, increased competitive pricing pressure due to excess inventory throughout the solar industry, coupled with delays in new product launches, business interruption caused by a fire in our research and development lab and the narrowing of our solar product focus have resulted in significantly reduced sales projections for the Mastervolt business unit. Similar to other solar industry suppliers, we no longer expect a significant near-term rebound in solar sales that was previously anticipated and have revised our financial projections to include lower solar sales levels and reduced profit levels in the future. The revised financial projections and an increase in the discount rate from 16.6% to 19.8% (given the associated risk premium and market outlook) resulted in a $40.8 million goodwill impairment.

While we believe that the North American Electrical business' diverse electrical products and technologies will continue to generate positive cash flows and earnings, the decision to divest the Electrical segment represented a “triggering event” requiring an interim impairment review. The third quarter fiscal 2013 goodwill impairment charge of $96.9 million reflected current market conditions (lower projected market multiples), a 16.6% discount rate (compared to 12.9% in the fourth quarter of fiscal 2012) and a consistent expectation regarding moderate to long-term sales growth, including a 3% terminal year growth rate. Sales projections for the North American Electrical business incorporated developments during the first nine months of fiscal 2013, in which sales were below prior year levels by approximately 10%. The decline in sales is the result of the loss of certain low margin retail DIY business, channel inventory reductions across served markets and reduced transformer product line demand from major OEM customers. Despite the reduced sales volumes, profit margins have remained consistent with prior projections - the result of controlled spending and the benefits of current year headcount reductions.

To the extent actual proceeds on the divestiture are less than current projections, or there are changes in the composition of the asset disposal group, further write-downs of the carrying value of the Electrical segment may be required.

Long-Lived Assets: Indefinite lived intangible assets are also subject to annual impairment testing. On an annual basis, the fair value of the indefinite lived assets, based on a relief of royalty income approach, are evaluated to determine if an impairment charge is required. In the fourth quarter of fiscal 2012 we recognized a $25.9 million impairment of the Mastervolt tradename - the result of a reduction in the assumed royal rate (from 3.5% to 2%) and lower projected long-term Mastervolt solar sales. In the third quarter of fiscal ~~2012,~~2013 we ~~refinanced our 6.875% Senior Notes (due 2017) with new 5.625% Senior Notes (due 2022) and substantially~~also reassessed the recoverability of all Electrical segment tradenames, as a result of the ~~outstanding 2% Convertible Notes~~plan to divest the segment, and recognized an additional $21.3 million impairment. The estimated fair value of the tradenames were ~~converted into common stock.~~

adversely impacted by further reductions in royalty rate assumptions, an increase in the discount rate and lower projected sales volumes.

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We also review long-lived assets for impairment when events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. If such indicators are present, we perform undiscounted operating cash flow analyses to determine if an impairment exists. If an impairment is determined to exist, any related impairment loss is calculated based on fair value. During the third quarter of fiscal 2013, we recognized an $11.2 million impairment of Electrical segment long-lived assets - representing the excess of the net book value of the held for sale assets over the estimated fair value, less selling costs.

Item 3 – Quantitative and Qualitative Disclosures about Market Risk

The diverse nature of our business activities necessitates the management of various financial and market risks, including those related to changes in interest rates, foreign currency exchange rates and commodity costs.

Interest Rate Risk:

~~There has been no significant~~ We manage interest costs using a mixture of fixed-rate and variable-rate debt. A change in interest rates on our 5.625% Senior Notes impacts the fair value of the notes, but not our earnings or cash flow because the interest on such debt is fixed. Our variable-rate debt obligations consist primarily of revolver and term loan borrowings under our Senior Credit Facility (see Note 7, “Debt” for further details). A 10% increase in the average cost of our variable rate debt (which is based on LIBOR interest rates) would result in an increase in interest expense (pre-tax) of approximately $0.1 million for the three months ended May 31, 2013. From time to time, we may enter into interest rate swap agreements to manage our exposure to ~~market~~interest rate changes. At May 31, 2013, we were not a party to any interest rate swap derivatives.

Foreign Currency Risk: We maintain operations in the U.S. and various foreign countries. Our non-U.S. operations, located primarily in the Netherlands, United Kingdom, Mexico and China, have foreign currency risk ~~during~~relating to receipts from customers, payments to suppliers and intercompany transactions denominated in foreign currencies. Under certain conditions, we enter into hedging transactions, primarily forward foreign currency swaps, that enable us to mitigate the ~~nine~~potential adverse impact of foreign currency exchange rate risk (see Note 9, “Derivatives” for further information). We do not engage in trading or other speculative activities with these transactions, as established policies require that these hedging transactions relate to specific currency exposures.

The strengthening of the U.S. dollar could also result in unfavorable translation effects on our results of operations and financial position as the results of foreign operations are translated into U.S. dollars. To illustrate the potential impact of changes in foreign currency exchange rates on the translation of our results of operations, quarterly sales and operating profit were remeasured assuming a ten percent decrease in foreign exchange rates compared with the U.S. dollar. Using this method, quarterly sales and operating profit would have been $20 million and $1 million lower, respectively, for the three months ended May 31, ~~2012. For~~2013. This sensitivity analysis assumed that each exchange rate would change in the same direction relative to the U.S. dollar and excludes the potential effects that changes in foreign currency exchange rates may have on sales levels or local currency prices. Similarly, a ~~discussion~~ten percent decline in foreign currency exchange rates on our May 31, 2013 financial position would result in a $28 million decrease to equity (accumulated other comprehensive loss), as a result of non U.S. dollar denominated assets and liabilities being translated into U.S. dollars, our ~~exposure~~reporting currency.

Commodity Cost Risk: We source a wide variety of materials and components from a network of global suppliers. While such materials are typically available from numerous suppliers, commodity raw materials, such as steel, plastic resin and copper, are subject to ~~market risk, refer~~price fluctuations, which could have a negative impact on our results. We strive to ~~Item 7A, Quantitative~~pass along such commodity price increases to customers to avoid profit margin erosion and ~~Qualitative Disclosures about Market Risk, contained in our Annual Report on Form 10-K for~~utilize LEAD initiatives to further mitigate the ~~fiscal year ended August 31, 2011.~~

impact of commodity raw material price fluctuations as improved efficiencies across all locations are achieved.

Item 4 – Controls and Procedures

Evaluation of Disclosure Controls and Procedures.

Under the supervision and with the participation of our senior management, including our chief executive officer and chief financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this quarterly report (the “Evaluation Date”). Based on this evaluation, our chief executive officer and chief financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective such that the information relating to the Company, including consolidated subsidiaries, required to be disclosed in our Securities and Exchange Commission (“SEC”) reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to the Company’s management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

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Changes in Internal Control Over Financial Reporting.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). There have been no changes in our internal control over financial reporting that occurred during the quarter ended May 31, ~~2012~~2013 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

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PART ~~II –~~ II—OTHER INFORMATION

~~Items 1,~~

Item 1A ~~3, 4~~– Risk Factors

Our business could be adversely impacted by the proposed sale of our Electrical segment.

We previously announced plans to divest our Electrical segment as part of our continuing efforts to proactively focus on platforms where we believe we can take advantage of our core competencies, current business model and ~~5 are~~global growth trends. Divestitures involve risks, including difficulties in the separation of operations, services, products and personnel, the diversion of management's attention from other business concerns, the disruption of our business, the potential loss of key employees and the retention of contingent liabilities related to the divested business. In addition, divestitures may result in additional asset impairment charges, including those related to goodwill and other intangible assets, which could have a material adverse effect on our financial condition and results of operations. We may not ~~applicable~~receive an acceptable offer for the Electrical segment and ~~have been omitted.~~

we may not be able to negotiate an acceptable definitive agreement or consummate a sale transaction. We cannot assure you that we will be successful in managing these or any other significant risks that we encounter in divesting our Electrical segment.

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds

In September 2011, ~~the Company’s~~our Board of Directors authorized a stock repurchase program to acquire up to ~~7 million~~7,000,000 shares of the Company’s outstanding Class A ~~Common Stock.~~common stock. The following table presents information regarding the repurchase of common stock ~~by the Company~~ during the three months ended May 31, ~~2012.~~2013. All of the shares were repurchased as part of the publicly announced program.

Period

Total Number of
Shares Purchased

Average Price
Paid per Share

Maximum Number of Shares
That May Yet Be Purchased
Under the Program

March 1 to March 31, 2012
   —         —         6,000,720
April 1 to April 30, 2012
   —         —         6,000,720
May 1 to May 31, 2012
   732,965       $ 25.71       5,267,755





Total
   732,965       $ 25.71



	Total Number of Shares Purchased	Average Price Paid per Share	Maximum Number of Shares That May Yet Be Purchased Under the Program
March 1 to March 31, 2013	—	—	4,021,006
April 1 to April 30, 2013	162,400	29.83	3,858,606
May 1 to May 31, 2013	—	—	3,858,606
Total	162,400	29.83

Item 5 – Other Information

On July 8, 2013, the Board of Directors adopted an amendment to the Company's Amended and Restated Bylaws (the “Bylaws”), effective on such date. Sections 2.04(a) and 2.04(b) of the Bylaws were amended to include additional procedural requirements with respect to shareholder proposals and director nominations at annual and special meetings of shareholders. As a result of the amendment, any shareholder wishing to put forward a shareholder proposal or nominate a director for election must disclose additional information regarding share ownership, derivative positions, proxies and voting agreements and provide additional detail regarding its economic ownership.

A copy of the Bylaws as amended is attached as Exhibit 3.1 to this Quarterly Report on Form 10-Q.

Item 6 – Exhibits

(a) Exhibits

See “Index to Exhibits” on page ~~28,~~37, which is incorporated herein by reference.

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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 thereunto duly authorized.


		~~ACTUANT CORPORATION~~
		~~(Registrant)~~

	ACTUANT CORPORATION
	(Registrant)
Date: July 9, ~~2012~~	2013	By:	/~~s/ Andrew~~S/ ANDREW G. ~~Lampereur~~ LAMPEREUR
			Andrew G. Lampereur
			Executive Vice President and Chief Financial Officer
			(Principal Financial Officer)

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ACTUANT CORPORATION

(the “Registrant”)

(Commission File No. 1-11288)

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED ~~May~~MAY 31, ~~2012~~

2013

INDEX TO EXHIBITS



~~Exhibit~~	~~Description~~	~~Incorporated Herein~~ ~~By Reference To~~	~~Filed~~ ~~Herewith~~

~~4.1~~ Exhibit	~~Indenture dated April 16, 2012, with respect to the Company’s 5.625% Senior Notes due 2022, among Actuant Corporation, the guarantors party thereto, and U.S. Bank National Association, as trustee.~~Description	~~Form 8-K filed with the~~ ~~SEC on April 18, 2012~~ Incorporated Herein By Reference To

~~4.2~~ Filed Herewith	Supplemental Indenture dated April 16, 2012, with respect to the Company’s 6.875% Senior Notes due 2017, among Actuant Corporation, the guarantors party thereto, and U.S. Bank National Association, as trustee.Furnished Herewith
3.1	~~Form 8-K filed with the~~ ~~SEC on April 18, 2012~~Amended and Restated Bylaws, as amended

~~10.1~~	Purchase Agreement dated as of April 2, 2011, by and among Actuant Corporation and certain of its subsidiaries named therein, and Wells Fargo Securities, LLC, as representative of the several Initial Purchasers named therein.X	~~Form 8-K filed with the~~ ~~SEC on April 6, 2012~~


~~10.2~~	~~Registration Rights Agreement dated April 16, 2012, among Actuant Corporation and the initial purchasers of the Company’s 5.625% Senior Notes due 2022.~~	~~Form 8-K filed with the~~ ~~SEC on April 18, 2012~~

~~10.3~~	~~Form of Actuant Corporation Change in Control Agreement for Messrs. Arzbaecher, Blackmore, Goldstein, Kobylinski, Lampereur, Scheer, Wozniak and Ms. Grissom.~~	~~Form 8-K filed with the~~ ~~SEC on May 2, 2012~~

~~10.4~~	~~Form of Actuant Corporation Change in Control Agreement for Messrs. Axline and Boel.~~	~~Form 8-K filed with the~~ ~~SEC on May 2, 2012~~

31.1	Certification of Chief Executive Officer pursuant to Section 302 of the ~~Sarbanes-Oxley~~Sarbanes- Oxley Act of 2002			X


31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002			X


32.1	Certification of Chief Executive Officer pursuant to Section 906 of the ~~Sarbanes-Oxley~~Sarbanes- Oxley Act of 2002				X


32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002				X


101* 101	The following materials from the Actuant Corporation Form 10-Q for the quarter ended May 31, ~~2012~~2013 formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Consolidated Statements of ~~Earnings,~~Operations, (ii) the Condensed Consolidated Statements of Comprehensive Income (Loss), (iii) the Condensed Consolidated Balance Sheets, ~~(iii)~~(iv) the Condensed Consolidated Statements of Cash Flows and ~~(iv)~~(v) the Notes to Condensed Consolidated Financial Statements.		X

~~Furnished herewith~~


	Three Months Ended May 31,					Nine Months Ended May 31,
	2012		2011			2012		2011
Net sales	$	429,215	$	392,777		$	1,200,038	$	1,041,887
Cost of products sold		263,095		238,739			740,018		640,969

Gross profit		166,120		154,038			460,020		400,918
Selling, administrative and engineering expenses		91,063		89,166			263,935		244,453
Amortization of intangible assets		7,393		6,871			21,684		19,846

Operating profit		67,664		58,001			174,401		136,619
Financing costs, net		7,236		7,850			23,279		23,640
Debt refinancing charges		16,830		—			16,830		—
Other expense, net		2,604		331			3,090		1,276

Earnings from continuing operations before income taxes		40,994		49,820			131,202		111,703
Income tax expense		6,593		11,460			27,452		24,540

Earnings from continuing operations		34,401		38,360			103,750		87,163
Loss from discontinued operations, net of income taxes		—		(2,002	)		—		(16,986	)

Net earnings	$	34,401	$	36,358		$	103,750	$	70,177

Earnings from continuing operations per share:
Basic	$	0.48	$	0.56		$	1.50	$	1.28
Diluted	$	0.45	$	0.51		$	1.39	$	1.17

Earnings per share:
Basic	$	0.48	$	0.53		$	1.50	$	1.03
Diluted	$	0.45	$	0.49		$	1.39	$	0.95

Weighted average common shares outstanding:
Basic		71,083		68,354			69,184		68,208
Diluted		75,371		75,571			75,201		75,314


	May 31,			August 31,
	2012			2011
ASSETS
Current assets
Cash and cash equivalents	$	80,149		$	44,221
Accounts receivable, net		237,438			223,760
Inventories, net		206,389			223,235
Deferred income taxes		32,206			32,461
Other current assets		19,109			22,807

Total current assets		575,291			546,484
Property, plant and equipment
Land, buildings and improvements		50,873			51,901
Machinery and equipment		254,083			263,250

Gross property, plant and equipment		304,956			315,151
Less: Accumulated depreciation		(188,991	)		(186,502	)

Property, plant and equipment, net		115,965			128,649
Goodwill		873,682			888,466
Other intangibles, net		454,360			479,406
Other long-term assets		14,811			13,676

Total assets	$	2,034,109		$	2,056,681

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Trade accounts payable	$	167,632		$	170,084
Accrued compensation and benefits		53,008			71,639
Short-term borrowings and current maturities of debt		6,250			2,690
Income taxes payable		30,289			19,342
Other current liabilities		68,583			66,548

Total current liabilities		325,762			330,303
Long-term debt		392,500			522,727
Deferred income taxes		133,619			165,945
Pension and postretirement benefit liabilities		18,171			18,864
Other long-term liabilities		86,772			99,829
Shareholders’ equity
Class A common stock, $0.20 par value per share, authorized 168,000,000, issued 75,274,829 and 68,657,234 shares, respectively		15,054			13,731
Additional paid-in capital		382			(154,231	)
Treasury stock, at cost, 1,732,245 shares		(39,282	)		—
Retained earnings		1,180,942			1,077,192
Accumulated other comprehensive loss		(79,811	)		(17,679	)
Stock held in trust		(2,661	)		(2,137	)
Deferred compensation liability		2,661			2,137

Total shareholders’ equity		1,077,285			919,013

Total liabilities and shareholders’ equity	$	2,034,109		$	2,056,681


	Three Months Ended May 31, 2011			Nine Months Ended May 31, 2011
Net sales	$	—		$	49,305

Loss on disposal of business		(2,086	)		(15,829	)
Loss from operations of divested business		—			(1,157	)
Income tax benefit		84			—

Loss from discontinued operations, net of income taxes	$	(2,002	)	$	(16,986	)


	Weighted	May 31, 2012						August 31, 2011
	Average	Gross				Net		Gross				Net
	Amortization	Carrying		Accumulated		Book		Carrying		Accumulated		Book
	Period (Years)	Value		Amortization		Value		Value		Amortization		Value
Amortizable intangible assets:
Customer relationships	15	$	328,127	$	87,345	$	240,782	$	331,171	$	73,215	$	257,956
Patents	13		50,259		33,802		16,457		51,169		31,221		19,948
Trademarks and tradenames	20		41,178		7,966		33,212		38,917		6,571		32,346
Non-compete agreements and other	4		7,489		6,023		1,466		7,362		5,671		1,691
Indefinite lived intangible assets:
Tradenames	N/A		162,443		—		162,443		167,465		—		167,465

		$	589,496	$	135,136	$	454,360	$	596,084	$	116,678	$	479,406


	Nine Months Ended May 31, 2011
	Parent			Guarantors			Non- Guarantors			Eliminations			Consolidated
Operating Activities
Net cash provided by (used in) operating activities	$	15,423		$	(2,123	)	$	83,331		$	(1,533	)	$	95,098
Investing Activities
Proceeds from sale of property, plant and equipment		—			191			168			—			359
Proceeds from sale of businesses, net of transaction costs		—			—			3,463			—			3,463
Capital expenditures		(3,354	)		(3,537	)		(7,952	)		—			(14,843	)
Business acquisitions, net of cash acquired		—			(350	)		(159,697	)		—			(160,047	)

Cash used in investing activities		(3,354	)		(3,696	)		(164,018	)		—			(171,068	)
Financing Activities
Net borrowings on revolving credit facilities		—			—			14			—			14
Issuance of term loans		100,000			—			—			—			100,000
Intercompany loan activity		(95,141	)		5,819			89,322			—			—
Repurchases of 2% Convertible Notes		(34	)		—			—			—			(34	)
Debt issuance costs		(5,197	)		—			—			—			(5,197	)
Stock option exercises and related tax benefits		7,285			—			—			—			7,285
Cash dividends		(2,716	)		—			(1,533	)		1,533			(2,716	)

Cash provided by financing activities		4,197			5,819			87,803			1,533			99,352
Effect of exchange rate changes on cash		—			—			4,695			—			4,695

Net increase in cash and cash equivalents		16,266			—			11,811			—			28,077
Cash and cash equivalents—beginning of period		5,055			—			35,167			—			40,222

Cash and cash equivalents—end of period	$	21,321		$	—		$	46,978		$	—		$	68,299


	May 31, 2012			PWC%			May 31, 2011			PWC%
Accounts receivable, net	$	238			14	%	$	234			15	%
Inventory, net		206			12	%		213			14	%
Accounts payable		(168	)		-10	%		(172	)		-11	%

Net primary working capital	$	276			16	%	$	275			18	%


Period	Total Number of Shares Purchased		Average Price Paid per Share		Maximum Number of Shares That May Yet Be Purchased Under the Program
March 1 to March 31, 2012		—		—		6,000,720
April 1 to April 30, 2012		—		—		6,000,720
May 1 to May 31, 2012		732,965	$	25.71		5,267,755

Total		732,965	$	25.71

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