UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

——————————— 
FORM 10-Q

 ————————————
(Mark One)

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

For the quarterly period ended November 30, 2012

February 28, 2013

OR

¨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 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,” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer x Accelerated filer ¨
Non-accelerated filer 
¨  (Do(Do not check if a smaller reporting company)
 Smaller reporting company ¨

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 DecemberMarch 31, 20122013 was 72,941,967.


TABLE OF CONTENTS73,185,832.

  Page No. 



TABLE OF CONTENTS

Part I—Financial Information

Page No.
 

 4 

 5 

 6 

 7 

 8 

 19 

 23 

 23 

 

 24 

24

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:

economic uncertainty or a prolonged economic downturn;

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

market conditions in the truck, automotive, agricultural, industrial, production automation, oil & gas, energy, maintenance, power generation, marine, solar, 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;


2


the potential for a non-cash asset impairment charge, if operating performance at one or more of our reporting units were to fall significantly below current levels (given the amount of goodwill and intangible assets recorded in previously completed acquisitions);
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, 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


PART I—FINANCIAL INFORMATION

Item 1—Financial Statements

ACTUANT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(In thousands, except per share amounts)

(Unaudited)

   Three Months Ended November 30, 
   2012   2011 

Net sales

  $377,248    $392,799  

Cost of products sold

   230,262     240,191  
  

 

 

   

 

 

 

Gross profit

   146,986     152,608  

Selling, administrative and engineering expenses

   87,830     88,109  

Amortization of intangible assets

   7,854     7,218  
  

 

 

   

 

 

 

Operating profit

   51,302     57,281  

Financing costs, net

   6,322     8,222  

Other expense, net

   364     657  
  

 

 

   

 

 

 

Earnings before income tax expense

   44,616     48,402  

Income tax expense

   8,273     11,228  
  

 

 

   

 

 

 

Net earnings

  $36,343    $37,174  
  

 

 

   

 

 

 

Earnings per share:

    

Basic

  $0.50    $0.54  

Diluted

  $0.49    $0.50  

Weighted average common shares outstanding:

    

Basic

   72,791     68,421  

Diluted

   74,271     75,142  

  Three Months Ended Six Months Ended
  February 28,
2013
 February 29,
2012
 February 28,
2013
 February 29,
2012
Net sales $370,370
 $378,024
 $747,618
 $770,823
Cost of products sold 230,811
 236,732
 461,073
 476,923
Gross profit 139,559
 141,292
 286,545
 293,900
Selling, administrative and engineering expenses 89,977
 84,763
 177,807
 172,872
Amortization of intangible assets 7,638
 7,073
 15,492
 14,291
Operating profit 41,944
 49,456
 93,246
 106,737
Financing costs, net 6,260
 7,821
 12,582
 16,043
Other (income) expense, net (36) (171) 328
 486
Earnings before income tax expense 35,720
 41,806
 80,336
 90,208
Income tax expense 7,285
 9,631
 15,558
 20,859
Net earnings $28,435
 $32,175
 $64,778
 $69,349
         
Earnings per share:        
Basic $0.39
 $0.47
 $0.89
 $1.02
Diluted $0.38
 $0.43
 $0.87
 $0.94
         
Weighted average common shares outstanding:        
Basic 72,946
 68,064
 72,869
 68,242
Diluted 74,416
 75,105
 74,343
 75,124
See accompanying Notes to Condensed Consolidated Financial Statements



4


ACTUANT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(unaudited)

   Three Months Ended November 30, 
   2012  2011 

Net earnings

  $36,343   $37,174  

Other comprehensive income (loss), net of tax

   

Foreign currency translation adjustments

   12,089    (32,567

Pension and other postretirement benefit plans

   

Actuarial loss arising during period

   125    —    

Amortization of actuarial losses included in net periodic pension cost

   90    33  
  

 

 

  

 

 

 
   215    33  

Cash flow hedges

   

Unrealized net gains arising during period

   2    148  

Net (gains) losses reclassified into earnings

   (131  —    
  

 

 

  

 

 

 
   (129  148  
  

 

 

  

 

 

 

Total other comprehensive income (loss), net of tax

   12,175    (32,386
  

 

 

  

 

 

 

Comprehensive income

  $48,518   $4,788  
  

 

 

  

 

 

 

(Unaudited)
  Three Months Ended Six Months Ended
  February 28,
2013
 February 29,
2012
 February 28,
2013
 February 29,
2012
Net earnings $28,435
 $32,175
 $64,778
 $69,349
Other comprehensive income (loss), net of tax        
Foreign currency translation adjustments (11,945) 3,979
 144
 (28,588)
         
Pension and other postretirement benefit plans        
Actuarial loss arising during period 
 
 125
 
Amortization of actuarial losses included in net periodic pension cost 90
 50
 180
 83
                 Total pension and other postretirement benefit plans 90
 50
 305
 83
         
Cash flow hedges        
Unrealized net losses arising during period (116) (267) (114) (119)
Net gain reclassified into earnings 
 
 (131) 
                 Total cash flow hedges (116) (267) (245) (119)
Total other comprehensive income (loss), net of tax (11,971) 3,762
 204
 (28,624)
Comprehensive income $16,464
 $35,937
 $64,982
 $40,725
See accompanying Notes to Condensed Consolidated Financial Statements


5


ACTUANT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

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

  February 28,
2013
 August 31,
2012
ASSETS    
Current assets    
Cash and cash equivalents $90,823
 $68,184
Accounts receivable, net 238,601
 234,756
Inventories, net 217,540
 211,690
Deferred income taxes 23,604
 22,583
Other current assets 24,862
 24,068
Total current assets 595,430
 561,281
Property, plant and equipment    
Land, buildings and improvements 51,744
 49,866
Machinery and equipment 246,542
 242,718
Gross property, plant and equipment 298,286
 292,584
Less: Accumulated depreciation (184,162) (176,700)
Property, plant and equipment, net 114,124
 115,884
Goodwill 866,685
 866,412
Other intangibles, net 430,827
 445,884
Other long-term assets 16,765
 17,658
Total assets $2,023,831
 $2,007,119
LIABILITIES AND SHAREHOLDERS’ EQUITY    
Current liabilities    
Trade accounts payable $153,814
 $174,746
Accrued compensation and benefits 45,297
 58,817
Current maturities of long-term debt 10,000
 7,500
Income taxes payable 2,852
 5,778
Other current liabilities 58,566
 72,165
Total current liabilities 270,529
 319,006
Long-term debt 385,000
 390,000
Deferred income taxes 129,080
 132,653
Pension and postretirement benefit liabilities 26,137
 26,442
Other long-term liabilities 88,817
 87,182
Shareholders’ equity    
Class A common stock, $0.20 par value per share, authorized 168,000,000 shares, issued 76,111,414 and 75,519,079 shares, respectively 15,221
 15,102
Additional paid-in capital 23,873
 7,725
Treasury stock, at cost, 2,978,994 and 2,658,751 shares, respectively (71,904) (63,083)
Retained earnings 1,226,346
 1,161,564
Accumulated other comprehensive loss (69,268) (69,472)
Stock held in trust (3,076) (2,689)
Deferred compensation liability 3,076
 2,689
Total shareholders’ equity 1,124,268
 1,051,836
Total liabilities and shareholders’ equity $2,023,831
 $2,007,119
(unaudited)

   November 30,  August 31, 
   2012  2012 
ASSETS   

Current assets

   

Cash and cash equivalents

  $68,311   $68,184  

Accounts receivable, net

   232,267    234,756  

Inventories, net

   225,084    211,690  

Deferred income taxes

   22,785    22,583  

Prepaid expenses and other current assets

   30,121    24,068  
  

 

 

  

 

 

 

Total current assets

   578,568    561,281  

Property, plant and equipment

   

Land, buildings and improvements

   50,796    49,866  

Machinery and equipment

   252,237    242,718  
  

 

 

  

 

 

 

Gross property, plant and equipment

   303,033    292,584  

Less: Accumulated depreciation

   (185,274  (176,700
  

 

 

  

 

 

 

Property, plant and equipment, net

   117,759    115,884  

Goodwill

   871,698    866,412  

Other intangibles, net

   440,188    445,884  

Other long-term assets

   17,243    17,658  
  

 

 

  

 

 

 

Total assets

  $2,025,456   $2,007,119  
  

 

 

  

 

 

 
LIABILITIES AND SHAREHOLDERS’ EQUITY   

Current liabilities

   

Trade accounts payable

  $164,665   $174,746  

Accrued compensation and benefits

   43,696    58,817  

Current maturities of debt

   8,750    7,500  

Income taxes payable

   5,982    5,778  

Other current liabilities

   66,754    72,165  
  

 

 

  

 

 

 

Total current liabilities

   289,847    319,006  

Long-term debt

   387,500    390,000  

Deferred income taxes

   129,951    132,653  

Pension and postretirement benefit liabilities

   26,233    26,442  

Other long-term liabilities

   89,927    87,182  

Shareholders’ equity

   

Class A common stock, $0.20 par value per share, authorized 168,000,000 shares, issued 75,799,085 and 75,519,079 shares, respectively

   15,158    15,102  

Additional paid-in capital

   16,450    7,725  

Treasury stock, at cost, 2,917,951 and 2,658,751 shares, respectively

   (70,225  (63,083

Retained earnings

   1,197,912    1,161,564  

Accumulated other comprehensive loss

   (57,297  (69,472

Stock held in trust

   (2,340  (2,689

Deferred compensation liability

   2,340    2,689  
  

 

 

  

 

 

 

Total shareholders’ equity

   1,101,998    1,051,836  
  

 

 

  

 

 

 

Total liabilities and shareholders’ equity

  $2,025,456   $2,007,119  
  

 

 

  

 

 

 

See accompanying Notes to Condensed Consolidated Financial Statements


6


ACTUANT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

   Three Months Ended November 30, 
   2012  2011 

Operating Activities

   

Net earnings

  $36,343   $37,174  

Adjustments to reconcile net earnings to cash provided by operating activities:

   

Depreciation and amortization

   14,449    13,540  

Amortization of debt discount and debt issuance costs

   496    497  

Stock-based compensation expense

   3,477    3,543  

Benefit for deferred income taxes

   (3,156  (950

Other non-cash adjustments

   (177  58  

Changes in components of working capital and other:

   

Accounts receivable

   4,539    (9,597

Inventories

   (11,318  (2,595

Prepaid expenses and other assets

   (6,143  (825

Trade accounts payable

   (11,548  (2,886

Income taxes payable

   1,161    1,216  

Accrued compensation and benefits

   (13,953  (19,169

Other accrued liabilities

   (1,895  469  
  

 

 

  

 

 

 

Net cash provided by operating activities

   12,275    20,475  

Investing Activities

   

Proceeds from sale of property, plant and equipment

   977    5,918  

Capital expenditures

   (7,689  (5,595

Business acquisitions, net of cash acquired

   (83  (290
  

 

 

  

 

 

 

Net cash (used in) provided by investing activities

   (6,795  33  

Financing Activities

   

Net borrowings on revolver and other debt

   —      4,809  

Principal repayments on term loan

   (1,250  —    

Purchase of treasury shares

   (7,142  (20,410

Stock option exercises and related tax benefits

   5,473    2,782  

Cash dividend

   (2,911  (2,748
  

 

 

  

 

 

 

Net cash used in financing activities

   (5,830  (15,567

Effect of exchange rate changes on cash

   477    (1,043
  

 

 

  

 

 

 

Net increase in cash and cash equivalents

   127    3,898  

Cash and cash equivalents – beginning of period

   68,184    44,221  
  

 

 

  

 

 

 

Cash and cash equivalents – end of period

  $68,311   $48,119  
  

 

 

  

 

 

 

  Six Months Ended
  February 28,
2013
 February 29,
2012
Operating Activities    
Net earnings $64,778
 $69,349
Adjustments to reconcile net earnings to cash provided by operating activities:    
Depreciation and amortization 28,898
 26,610
Amortization of debt discount and debt issuance costs 992
 997
Stock-based compensation expense 7,128
 6,962
Benefit for deferred income taxes (6,018) (2,254)
Other non-cash adjustments (172) (346)
Changes in components of working capital and other    
Accounts receivable (3,721) (17,107)
Inventories (4,152) (1,060)
Prepaid expenses and other assets (1,204) (2,137)
Trade accounts payable (22,281) (8,128)
Income taxes payable (2,722) 36
Accrued compensation and benefits (12,427) (14,098)
Other accrued liabilities (8,776) (6,823)
Net cash provided by operating activities 40,323
 52,001
Investing Activities    
Proceeds from sale of property, plant and equipment 1,177
 7,775
Capital expenditures (11,726) (10,452)
Business acquisitions, net of cash acquired (1,433) (18,907)
Net cash used in investing activities (11,982) (21,584)
Financing Activities    
Net borrowings on revolver and other debt 
 (167)
Principal repayments on term loan (2,500) 
Purchase of treasury shares (8,821) (20,410)
Stock option exercises and related tax benefits 10,772
 5,507
Cash dividend (2,911) (2,748)
Net cash used in financing activities (3,460) (17,818)
Effect of exchange rate changes on cash (2,242) 1,625
Net increase in cash and cash equivalents 22,639
 14,224
Cash and cash equivalents – beginning of period 68,184
 44,221
Cash and cash equivalents – end of period $90,823
 $58,445
See accompanying Notes to Condensed Consolidated Financial Statements



7


NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Basis of 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, 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 2012 Annual Report on Form 10-K.

In the opinion of management, all adjustments considered necessary for a fair statement of financial results have been made. Such adjustments consist of only those of a normal recurring nature. Operating results for the three and six months ended November 30, 2012February 28, 2013 are not necessarily indicative of the results that may be expected for the entire fiscal year ending August 31, 2013.

2013.

Note 2. Acquisitions
The Company incurred acquisition transaction costs of

$0.1 million and $0.7 million for the six months ended February 28, 2013 and February 29, 2012, respectively, related to various business acquisition activities. During the second quarter of fiscal 2013, the Company also paid $1.3 million of deferred purchase price consideration for acquisitions completed in previous periods. The Company completed three business acquisitions during fiscal 2012. All of the acquisitions 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 these companies, as well as the complementary strategic fit and resulting synergies these businesses shouldare expected to bring to existing operations. The Company incurred acquisition transaction costs of $0.1 million and $0.3 million for the three months ended November 30, 2012 and 2011, respectively, related to various business acquisition activities.

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 Company completed two Maxima Technologies tuck-in acquisitions that further expand the geographic presence, product offerings and technologies of the Engineered Solutions segment. On July 20, 2012 the Company completed the acquisition of the stock of CrossControl AB (“CrossControl”) for $40.6$40.6 million of cash, plus potential contingent consideration. CrossControl, headquartered in Sweden, provides advanced electronic solutions for user-machine interaction, vehicle control and mobile connectivity in critical environments. On March 28, 2012 the Company acquired the stock of Turotest Medidores Ltda (“Turotest”) for $8.1$8.1 million of cash and $5.3$5.3 million of deferred purchase price. Turotest, headquartered in Brazil, designs and manufactures instrument panels and gauges servingfor 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$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 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 for fiscal 2012 acquisitions resulted in the recognition of $40.4$40.7 million of goodwill (which is not deductible for tax purposes) and $32.8$32.8 million of intangible assets, including $24.2$24.2 million of customer relationships, $5.7$5.7 million of tradenames, $2.2$2.2 million of technologies and $0.7$0.7 million of non-compete agreements.

The following unaudited pro forma results of operations of the Company for the three and six months ended November 30,February 28, 2013 and February 29, 2012 and 2011,, give effect to these acquisitions as though the transactions and related financing activities had occurred on September 1, 2011 (in thousands, except per share amounts):

   Three Months Ended
November 30,
 
   2012   2011 

Net sales

    

As reported

  $377,248    $392,799  

Pro forma

   377,248     415,787  

Net earnings

    

As reported

  $36,343    $37,174  

Pro forma

   36,502     40,097  

Basic earnings per share

    

As reported

  $0.50    $0.54  

Pro forma

   0.50     0.59  

Diluted earnings per share

    

As reported

  $0.49    $0.50  

Pro forma

   0.49     0.54  


8


  Three Months Ended Six Months Ended
  February 28,
2013
 February 29,
2012
 February 28,
2013
 February 29,
2012
Net sales 
 
 
 
As reported $370,370
 $378,024
 $747,618
 $770,823
Pro forma 370,370
 395,154
 747,618
 810,941
Net earnings 
 
 
 
As reported $28,435
 $32,175
 $64,778
 $69,349
Pro forma 28,508
 32,695
 65,010
 72,785
Basic earnings per share 
 
 
 
As reported $0.39
 $0.47
 $0.89
 $1.02
Pro forma 0.39
 0.48
 0.89
 1.07
Diluted earnings per share 
 
 
 
As reported $0.38
 $0.43
 $0.87
 $0.94
Pro forma 0.38
 0.44
 0.87
 0.98
Note 3. Restructuring

The Company continuously reviews its cost structure to be responsive to changes in end market demand, identify opportunities for cost synergies from recent acquisitions and in light of changes in the worldwide economy. As a result of increased uncertainty and reduced demand, the Company has implemented various restructuring initiatives includingto reduce costs through workforce reductions, plant consolidations, to reduce manufacturing overhead, the continued movement of production and product sourcing to low cost countries and the centralization of certain selling and administrative functions. Restructuring costs were $0.7$1.0 million and $0.5$1.7 million for the three and six months ended November 30,February 28, 2013, respectively and $0.9 million and $1.4 million for the three and six months ended February 29, 2012 and 2011,, respectively. The restructuring reserve at November 30, 2012February 28, 2013 and August 31, 2012 was $2.3$1.7 million and $2.9$2.9 million, respectively. The remaining restructuring related 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.

Note 4. Goodwill and Other Intangible Assets

The changes in the carrying value of goodwill for the threesix months ended November 30, 2012February 28, 2013 are as follows (in thousands):

   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

   —       —       —       87     87  

Impact of changes in foreign currency rates

   1,044     2,020     777     1,358     5,199  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance as of November 30, 2012

  $82,448    $261,541    $214,647    $313,062    $871,698  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

  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
 
 522
 639
Impact of changes in foreign currency rates 1,020
 (4,645) 918
 2,341
 (366)
Balance as of February 28, 2013 $82,424
 $254,993
 $214,788
 $314,480
 $866,685

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

   Weighted   November 30, 2012   August 31, 2012 
   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    $349,873    $100,296    $249,577    $347,739    $93,768    $253,971  

Patents

   13     53,042     35,865     17,177     52,851     34,842     18,009  

Trademarks and tradenames

   19     43,690     9,357     34,333     43,820     8,670     35,150  

Non-compete agreements and other

   4     7,734     6,590     1,144     7,677     6,316     1,361  

Indefinite lived intangible assets:

              

Tradenames

   N/A     137,957     —       137,957     137,393     —       137,393  
    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
    $592,296    $152,108    $440,188    $589,480    $143,596    $445,884  
    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


9


  
 February 28, 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 $347,474
 $104,772
 $242,702
 $347,739
 $93,768
 $253,971
Patents 13 52,655
 36,292
 16,363
 52,851
 34,842
 18,009
Trademarks and tradenames 19 43,853
 9,959
 33,894
 43,820
 8,670
 35,150
Non-compete agreements and other 4 7,600
 6,678
 922
 7,677
 6,316
 1,361
Indefinite lived intangible assets: 
 
 
 
 
 
 
Tradenames N/A 136,946
 
 136,946
 137,393
 
 137,393
    $588,528
 $157,701
 $430,827
 $589,480
 $143,596
 $445,884
Amortization expense recorded on the intangible assets listed above was $7.9$7.6 million and $7.2$15.5 million for the three and six months ended November 30,February 28, 2013, respectively and $7.1 million and $14.3 million for the three and six months ended February 29, 2012 and 2011,, respectively. The Company estimates that amortization expense will be approximately $22.0$14.3 million for the remainder of fiscal 2013.2013. Amortization expense for future years is estimated to be as follows: $28.1$28.1 million in fiscal 2014 $28.0, $28.0 million in 2015 $27.9, $27.8 million in fiscal 2016 $26.7, $26.6 million in fiscal 2017 $26.3, $26.2 million in fiscal 2018 and $143.2$142.9 million thereafter. These future amortization expense amounts represent estimates, which may change based on future acquisitions, changes in foreign currency exchange rates or other factors.

Note 5. Product Warranty Costs

The Company generally offers its customers a warranty on products they purchase, although warranty periods vary by product type and application. During the threesix months ended November 30, 2011,February 29, 2012, the warranty reserve was reduced by $5.7$7.7 million, the result of a purchase accounting adjustment to Mastervolt’s initial estimated warranty 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):

   Three Months Ended
November 30,
 
   2012  2011 

Beginning balances

  $12,869   $23,707  

Purchase accounting adjustment

   —      (5,719

Provision for warranties

   2,417    2,491  

Warranty payments and costs incurred

   (3,096  (2,903

Impact of changes in foreign currency rates

   271    (1,109
  

 

 

  

 

 

 

Ending balances

  $12,461   $16,467  
  

 

 

  

 

 

 

  Six Months Ended
  February 28,
2013
 February 29,
2012
Beginning balances $12,869
 $23,707
Purchase accounting adjustments 
 (7,726)
Warranty reserves of acquired businesses 
 43
Provision for warranties 4,220
 5,393
Warranty payments and costs incurred (5,659) (5,640)
Impact of changes in foreign currency rates 320
 (1,109)
Ending balances $11,750
 $14,668


10


Note 6. Debt

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

                                            
   November 30,
2012
  August 31,
2012
 

Senior Credit Facility

   

Revolver

  $—     $—    

Term Loan

   96,250    97,500  
  

 

 

  

 

 

 
   96,250    97,500  

5.625% Senior Notes

   300,000    300,000  
  

 

 

  

 

 

 

Total Senior Indebtedness

   396,250    397,500  

Less: current maturities of long-term debt

   (8,750  (7,500
  

 

 

  

 

 

 

Total long-term debt

  $387,500   $390,000  
  

 

 

  

 

 

 

  February 28,
2013
 August 31,
2012
Senior Credit Facility    
Revolver $
 $
Term Loan 95,000
 97,500
  95,000
 97,500
5.625% Senior Notes 300,000
 300,000
Total Senior Indebtedness 395,000
 397,500
Less: current maturities of long-term debt (10,000) (7,500)
Total long-term debt $385,000
 $390,000
The Company’s Senior Credit Facility, which matures on February 23, 2016 provides a $600$600 million revolving credit facility, a $100$100 million term loan and a $300$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, 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 1.50% in the case of loans bearing interest at the base rate. At November 30, 2012,February 28, 2013, the borrowing spread on LIBOR based borrowings was 1.5%1.25% (aggregating 1.75%1.50% on the outstanding term 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 November 30, 2012February 28, 2013 the available and unused credit line under the revolver was $596.3 million.$596.4 million. Quarterly principal payments of $1.25$1.25 million began on the $100$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 November 30, 2012.

February 28, 2013.

On April 16, 2012, the Company issued $300$300 million of 5.625% Senior Notes due 2022 (the “Senior Notes”). 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 its then outstanding $250$250 million of 6.875% Senior Notes due 2017 at a cost of 104%, or $260.4 million.

$260.4 million.

In March 2012, the Company called all of its then outstanding $117.6$117.6 million of 2% Convertible Notes for cash at par. As a result of the call notice, 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.

Note 7. 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 following financial assets and liabilities, measured at fair value, are included in the condensed consolidated balance sheet (in thousands):

   November 30,
2012
   August 31,
2012
 

Level 1 Valuation:

    

Cash equivalents

  $1,158    $5,154  

Investments

   1,602     1,602  

Level 2 Valuation:

    

Foreign currency derivatives

  $576    $945  

  February 28,
2013
 August 31,
2012
Level 1 Valuation:    
Cash equivalents $1,132
 $5,154
Investments 1,714
 1,602
Level 2 Valuation: 
 
Foreign currency derivatives $(517) $945


11


At August 31, 2012, Mastervolt’s goodwill ($($40.0 million)million) and tradename ($($13.6 million)million) were written down to estimated fair value, resulting in a non-cash impairment charge of $62.5 million.$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. 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 at November 30, 2012February 28, 2013 and August 31, 2012 due to their short-term nature and the fact that the interest rates approximated market rates. The fair value of the Company’s outstanding $300$300 million of 5.625% Senior Notes was $310.5$308.3 million and $309.8$309.8 million at November 30, 2012February 28, 2013 and August 31, 2012, respectively. The fair value of the Senior Notes was based on quoted inactive market prices and are therefore classified as Level 2 within the valuation hierarchy.


Note 8. Derivatives
All derivatives are recognized on 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 a $0.5 million liability at February 28, 2013 compared to a $0.9 million asset at August 31, 2012.

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 February 28, 2013 and August 31, 2012, respectively. At February 28, 2013, unrealized losses of $0.1 million have been included in accumulated other comprehensive income 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 $133.7 million and $197.5 million, at February 28, 2013 and August 31, 2012, respectively. Net foreign currency losses related to these derivative instruments were $0.9 million and $0.3 million for the three and six months ended February 28, 2013, respectively, which offset foreign currency gains from the related revaluation on non-functional currency assets and liabilities (amounts included in other income and expense in the condensed consolidated statement of earnings).


12


Note 8.9. Earnings Per Share

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

   Three Months Ended
November 30,
 
   2012   2011 

Numerator:

    

Net earnings from continuing operations

  $36,343    $37,174  

Plus: 2% Convertible Notes financing costs, net of taxes

   —       511  
  

 

 

   

 

 

 

Net earnings for diluted earnings per share

  $36,343    $37,685  
  

 

 

   

 

 

 

Denominator:

    

Weighted average common shares outstanding for basic earnings per share

   72,791     68,421  

Net effect of dilutive securities—equity based compensation plans

   1,480     764  

Net effect of 2% Convertible Notes based on the if-converted method

   —       5,957  
  

 

 

   

 

 

 

Weighted average common and equivalent shares outstanding for diluted earnings per share

   74,271     75,142  
  

 

 

   

 

 

 

Basic Earnings Per Share:

  $0.50    $0.54  

Diluted Earnings Per Share:

  $0.49    $0.50  

At November 30, 2012 and 2011, outstanding share based awards to acquire 789,000 and 3,856,000 shares of common stock were not included in the Company’s computation of earnings per share because the effect would have been anti-dilutive.

  Three Months Ended Six Months Ended
  February 28,
2013
 February 29,
2012
 February 28,
2013
 February 29,
2012
Numerator:        
Net earnings $28,435
 $32,175
 $64,778
 $69,349
Plus: 2% Convertible Notes financing costs, net of taxes 
 383
 
 893
Net earnings for diluted earnings per share $28,435
 $32,558
 $64,778
 $70,242
Denominator:        
Weighted average common shares outstanding for basic earnings per share 72,946
 68,064
 72,869
 68,242
Net effect of dilutive securities—equity based compensation plans 1,470
 1,084
 1,474
 925
Net effect of 2% Convertible Notes based on the if-converted method 
 5,957
 
 5,957
Weighted average common and equivalent shares outstanding for diluted earnings per share 74,416
 75,105
 74,343
 75,124
         
Basic Earnings Per Share: $0.39
 $0.47
 $0.89
 $1.02
Diluted Earnings Per Share: $0.38
 $0.43
 $0.87
 $0.94
         
Anti-dilutive securities-equity based compensation plans (excluded from earnings per share calculation) 759
 2,175
 774
 3,016
As discussed in Note 6, “Debt” the Company issued 5,951,440 shares of common stock in the third quarter of fiscal 2012, in conjunction with the conversion of its 2% Convertible Notes, resulting in an increase in the weighted average common shares outstanding for basic earnings per share. However, the impact of the additional share issuance was already included in the diluted earnings per share calculation, on an if-converted method. The Company has also repurchased common shares on the open market in the last year, as well as issued new shares pursuant to equity compensation plans.

Note 9.10. Income Taxes

The Company’sCompany'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. Federalfederal statutory rate, permanent items, state tax rates and 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 was 18.5%20.4% and 23.1%19.4% for the three and six months ended November 30, 2012February 28, 2013, respectively, and 2011, respectively.23.0% and 23.1% for the comparable prior year periods. The decrease in the effective tax rate for the three months ended November 30, 2012, relative to the prior year, reflects the benefits of tax minimization planning, increased foreign tax credits, and the utilization of net operating losses.

losses and discrete items. Income tax expense for the second quarter of fiscal 2013 included discrete period income tax benefits related to changes in tax laws and the reinstatement of the U.S. federal research and development tax credit (collectively $1.2 million) and a $2.4 million reversal of tax reserves established in prior years (as a result of favorable tax audits and the lapsing of various tax statues of limitations).

The gross liability for unrecognized tax benefits, excluding interest and penalties, increased from $24.6$24.6 million at August 31, 2012 to $25.3$24.7 million at November 30, 2012.February 28, 2013. Substantially all of these unrecognized tax benefits, if recognized, would reduce the effective income tax rate. In addition, as of November 30, 2012February 28, 2013 and August 31, 2012, the Company had liabilities totaling $4.8$4.7 million and $4.5$4.5 million, respectively, for the payment of interest and penalties related to its unrecognized tax benefits.


13


Note 10.11. Segment Information

The Company is a global manufacturer of a broad range of industrial products and systems and is organized into four 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 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 other harsh environment markets. The Engineered Solutions segment provides highly engineered position and motion control systems to OEMs in various vehicle markets, as well as a variety of other products to the industrial and agricultural markets.

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

   Three Months Ended
November 30,
 
   2012  2011 

Net Sales by Segment:

   

Industrial

  $101,122   $100,253  

Energy

   90,769    80,421  

Electrical

   69,439    82,833  

Engineered Solutions

   115,918    129,292  
  

 

 

  

 

 

 
  $377,248   $392,799  
  

 

 

  

 

 

 

Net Sales by Reportable Product Line:

   

Industrial

  $101,122   $100,253  

Energy

   90,769    80,421  

Electrical

   69,439    82,833  

Vehicle Systems

   61,187    76,363  

Other

   54,731    52,929  
  

 

 

  

 

 

 
  $377,248   $392,799  
  

 

 

  

 

 

 

Operating Profit:

   

Industrial

  $27,006   $27,934  

Energy

   15,387    13,217  

Electrical

   7,828    4,977  

Engineered Solutions

   7,625    18,999  

General Corporate

   (6,544  (7,846
  

 

 

  

 

 

 
  $51,302   $57,281  
  

 

 

  

 

 

 

   November 30,
2012
   August 31,
2012
 

Assets:

    

Industrial

  $271,607    $268,735  

Energy

   545,760     540,409  

Electrical

   444,780     437,914  

Engineered Solutions

   671,372     667,550  

General Corporate

   91,937     92,511  
  

 

 

   

 

 

 
  $2,025,456    $2,007,119  
  

 

 

   

 

 

 

  Three Months Ended Six Months Ended
  February 28,
2013

February 29,
2012
 February 28,
2013
 February 29,
2012
Net Sales by Segment:        
Industrial $98,999
 $98,342
 $200,121
 $198,595
Energy 80,794
 78,937
 171,563
 159,358
Electrical 69,902
 77,105
 139,341
 159,938
Engineered Solutions 120,675
 123,640
 236,593
 252,932
  $370,370
 $378,024
 $747,618
 $770,823
Net Sales by Reportable Product Line:        
Industrial $98,999
 $98,342
 $200,121
 $198,595
Energy 80,794
 78,937
 171,563
 159,358
Electrical 69,902
 77,105
 139,341
 159,938
Vehicle Systems 59,675
 68,916
 120,862
 145,280
Other 61,000
 54,724
 115,731
 107,652
  $370,370
 $378,024
 $747,618
 $770,823
Operating Profit:        
Industrial $26,350
 $26,691
 $53,356
 $54,624
Energy 9,677
 11,632
 25,064
 24,849
Electrical 5,072
 5,801
 12,900
 10,778
Engineered Solutions 8,275
 13,281
 15,900
 32,280
General Corporate (7,430) (7,949) (13,974) (15,794)
  $41,944
 $49,456
 $93,246
 $106,737
  February 28,
2013
 August 31,
2012
Assets:    
Industrial $272,791
 $268,735
Energy 534,279
 540,409
Electrical 443,474
 437,914
Engineered Solutions 672,836
 667,550
General Corporate 100,451
 92,511
  $2,023,831
 $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 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.


14


Note 11.12. Contingencies and Litigation

The Company had outstanding letters of credit of $10.9$10.8 million and $8.5$8.5 million at November 30, 2012February 28, 2013 and August 31, 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 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. 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 has facilities in numerous geographic locations that are subject to a range of environmental laws and regulations. Environmental expenditures over the past two years have not been material. Management believes that such costs will not have a material adverse effect on the Company’s financial 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 obligations. The discounted present value of future minimum lease payments for these leases was $12.0$12.2 million at November 30, 2012.

February 28, 2013.

Note 12.13. Guarantor Subsidiaries

As discussed in Note 6, “Debt” on April 16, 2012, Actuant Corporation (the “Parent”) issued $300$300.0 million of 5.625% Senior Notes. All of our material domestic wholly owned subsidiaries (the “Guarantors”) fully and unconditionally guarantee (except for certain customary limitations) such debt on a joint and several basis. 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 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 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.


15


CONDENSED CONSOLIDATING STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME

(In thousands)

   Three Months Ended November 30, 2012 
   Parent  Guarantors  Non-Guarantors  Eliminations  Consolidated 

Net sales

  $45,838   $124,117   $207,293   $—     $377,248  

Cost of products sold

   12,408    87,868    129,986    —      230,262  
  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Gross profit

   33,430    36,249    77,307    —      146,986  

Selling, administrative and engineering expenses

   17,453    25,040    45,337    —      87,830  

Amortization of intangible assets

   321    3,449    4,084    —      7,854  
  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Operating profit

   15,656    7,760    27,886    —      51,302  

Financing costs, net

   6,358    5    (41  —      6,322  

Intercompany expense (income), net

   (7,270  1,955    5,315    —      —    

Other expense (income), net

   (364  (316  1,044    —      364  
  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Earnings before income tax expense

   16,932    6,116    21,568    —      44,616  

Income tax expense

   3,140    1,134    3,999    —      8,273  
  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Net earnings before equity in earnings of subsidiaries

   13,792    4,982    17,569    —      36,343  

Equity in earnings of subsidiaries

   22,551    17,899    1,024    (41,474  —    
  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Net earnings

  $36,343   $22,881   $18,593   $(41,474 $36,343  
  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Comprehensive income

  $48,518   $28,858   $26,019   $(54,877 $48,518  
  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

   Three Months Ended November 30, 2011 
   Parent  Guarantors   Non-Guarantors  Eliminations  Consolidated 

Net sales

  $48,520   $136,441    $207,838   $—     $392,799  

Cost of products sold

   15,279    94,632     130,280    —      240,191  
  

 

 

  

 

 

   

 

 

  

 

 

  

 

 

 

Gross profit

   33,241    41,809     77,558    —      152,608  

Selling, administrative and engineering expenses

   20,666    26,262     41,181    —      88,109  

Amortization of intangible assets

   335    3,420     3,463    —      7,218  
  

 

 

  

 

 

   

 

 

  

 

 

  

 

 

 

Operating profit

   12,240    12,127     32,914    —      57,281  

Financing costs, net

   8,237    3     (18  —      8,222  

Intercompany expense (income), net

   (7,491  566     6,925    —      —    

Other expense, net

   193    344     120    —      657  
  

 

 

  

 

 

   

 

 

  

 

 

  

 

 

 

Earnings before income tax expense

   11,301    11,214     25,887    —      48,402  

Income tax expense

   2,622    2,601     6,005    —      11,228  
  

 

 

  

 

 

   

 

 

  

 

 

  

 

 

 

Net earnings before equity in earnings of subsidiaries

   8,679    8,613     19,882    —      37,174  

Equity in earnings (loss) of subsidiaries

   28,495    16,794     (488  (44,801  —    
  

 

 

  

 

 

   

 

 

  

 

 

  

 

 

 

Net earnings

  $37,174   $25,407    $19,394   $(44,801 $37,174  
  

 

 

  

 

 

   

 

 

  

 

 

  

 

 

 

Comprehensive income

  $4,788   $8,339    $11,321   $(19,660 $4,788  
  

 

 

  

 

 

   

 

 

  

 

 

  

 

 

 

  Three Months Ended February 28, 2013
  Parent Guarantors Non-Guarantors Eliminations Consolidated
Net sales $47,407
 $121,600
 $201,363
 $
 $370,370
Cost of products sold 14,938
 87,004
 128,869
 
 230,811
Gross profit 32,469
 34,596
 72,494
 
 139,559
Selling, administrative and engineering expenses 18,527
 24,376
 47,074
 
 89,977
Amortization of intangible assets 318
 3,282
 4,038
 
 7,638
Operating profit 13,624
 6,938
 21,382
 
 41,944
Financing costs, net 6,409
 1
 (150) 
 6,260
Intercompany expense (income), net (4,651) (876) 5,527
 
 
Other expense (income), net (383) (53) 400
 
 (36)
Earnings before income tax expense 12,249
 7,866
 15,605
 
 35,720
Income tax expense 2,498
 1,604
 3,183
 
 7,285
Net earnings before equity in earnings of subsidiaries 9,751
 6,262
 12,422
 
 28,435
Equity in earnings of subsidiaries 18,684
 10,765
 (589) (28,860) 
Net earnings $28,435
 $17,027
 $11,833
 $(28,860) $28,435
Comprehensive income $16,464
 $4,840
 $12,009
 $(16,849) $16,464
  Three Months Ended February 29, 2012
  Parent Guarantors Non-Guarantors Eliminations Consolidated
Net sales $49,514
 $137,431
 $191,079
 $
 $378,024
Cost of products sold 17,114
 97,651
 121,967
 
 236,732
Gross profit 32,400
 39,780
 69,112
 
 141,292
Selling, administrative and engineering expenses 19,660
 26,612
 38,491
 
 84,763
Amortization of intangible assets 335
 3,411
 3,327
 
 7,073
Operating profit 12,405
 9,757
 27,294
 
 49,456
Financing costs, net 8,035
 5
 (219) 
 7,821
Intercompany expense (income), net (8,682) 1,733
 6,949
 
 
Other expense (income), net 822
 1,330
 (2,323) 
 (171)
Earnings before income tax expense 12,230
 6,689
 22,887
 
 41,806
Income tax expense 2,818
 1,541
 5,272
 
 9,631
Net earnings before equity in earnings of subsidiaries 9,412
 5,148
 17,615
 
 32,175
Equity in earnings of subsidiaries 22,763
 17,819
 1,926
 (42,508) 
Net earnings $32,175
 $22,967
 $19,541
 $(42,508) $32,175
Comprehensive income $35,937
 $24,589
 $22,041
 $(46,630) $35,937

16


CONDENSED CONSOLIDATING STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME
(In thousands)
  Six Months Ended February 28, 2013
  Parent Guarantors Non-Guarantors Eliminations Consolidated
Net sales $93,245
 $245,717
 $408,656
 $
 $747,618
Cost of products sold 27,346
 174,872
 258,855
 
 461,073
Gross profit 65,899
 70,845
 149,801
 
 286,545
Selling, administrative and engineering expenses 35,980
 49,416
 92,411
 
 177,807
Amortization of intangible assets 639
 6,731
 8,122
 
 15,492
Operating profit 29,280
 14,698
 49,268
 
 93,246
Financing costs, net 12,767
 6
 (191) 
 12,582
Intercompany expense (income), net (11,921) 1,079
 10,842
 
 
Other expense, net (747) (369) 1,444
 
 328
Earnings before income tax expense 29,181
 13,982
 37,173
 
 80,336
Income tax expense 5,638
 2,738
 7,182
 
 15,558
Net earnings before equity in earnings of subsidiaries 23,543
 11,244
 29,991
 
 64,778
Equity in earnings of subsidiaries 41,235
 28,664
 435
 (70,334) 
Net earnings $64,778
 $39,908
 $30,426
 $(70,334) $64,778
Comprehensive income $64,982
 $33,698
 $38,028
 $(71,726) $64,982

  Six Months Ended February 29, 2012
  Parent Guarantors Non-Guarantors Eliminations Consolidated
Net sales $98,034
 $273,872
 $398,917
 $
 $770,823
Cost of products sold 32,393
 192,283
 252,247
 
 476,923
Gross profit 65,641
 81,589
 146,670
 
 293,900
Selling, administrative and engineering expenses 40,326
 52,874
 79,672
 
 172,872
Amortization of intangible assets 670
 6,831
 6,790
 
 14,291
Operating profit 24,645
 21,884
 60,208
 
 106,737
Financing costs, net 16,272
 8
 (237) 
 16,043
Intercompany expense (income), net (16,173) 2,299
 13,874
 
 
Other expense (income), net 1,015
 1,674
 (2,203) 
 486
Earnings before income tax expense 23,531
 17,903
 48,774
 
 90,208
Income tax expense 5,440
 4,142
 11,277
 
 20,859
Net earnings before equity in earnings of subsidiaries 18,091
 13,761
 37,497
 
 69,349
Equity in earnings of subsidiaries 51,258
 34,613
 1,438
 (87,309) 
Net earnings $69,349
 $48,374
 $38,935
 $(87,309) $69,349
Comprehensive income $40,725
 $32,928
 $33,362
 $(66,290) $40,725



17


CONDENSED CONSOLIDATING BALANCE SHEETS

(In thousands)

   November 30, 2012 
   Parent   Guarantors   Non-Guarantors   Eliminations  Consolidated 

ASSETS

         

Current assets

  $73,934    $152,380    $352,254    $—     $578,568  

Property, plant & equipment, net

   6,890     31,077     79,792     —      117,759  

Goodwill

   62,543     432,464     376,691     —      871,698  

Other intangibles, net

   14,201     202,745     223,242     —      440,188  

Investment in subsidiaries

   1,919,244     265,560     92,319     (2,277,123  —    

Intercompany receivable

   —       425,309     301,844     (727,153  —    

Other long-term assets

   11,835     22     5,386     —      17,243  
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

Total assets

  $2,088,647    $1,509,557    $1,431,528    $(3,004,276 $2,025,456  
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

LIABILITIES & SHAREHOLDERS' EQUITY

         

Current liabilities

  $61,673    $54,539    $173,635    $—     $289,847  

Long-term debt

   387,500     —       —       —      387,500  

Deferred income taxes

   88,353     —       41,598     —      129,951  

Pension and post-retirement benefit liabilities

   22,253     —       3,980     —      26,233  

Other long-term liabilities

   62,308     525     27,094     —      89,927  

Intercompany payable

   364,562     —       362,591     (727,153  —    

Shareholders’ equity

   1,101,998     1,454,493     822,630     (2,277,123  1,101,998  
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

Total liabilities and shareholders’ equity

  $2,088,647    $1,509,557    $1,431,528    $(3,004,276 $2,025,456  
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

   August 31, 2012 
   Parent   Guarantors   Non-Guarantors   Eliminations  Consolidated 

ASSETS

         

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

  $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 post-retirement 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  
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

  February 28, 2013
  Parent Guarantors Non-Guarantors Eliminations Consolidated
ASSETS          
Current assets          
Cash and cash equivalents $5,721
 $
 $85,102
 $
 $90,823
Accounts receivable, net 19,233
 71,033
 148,335
 
 238,601
Inventories, net 29,981
 78,581
 108,978
 
 217,540
Deferred income taxes 18,827
 
 4,777
 
 23,604
Other current assets 7,616
 1,585
 15,661
 
 24,862
Total current assets 81,378
 151,199
 362,853
 
 595,430
Property, plant & equipment, net 6,659
 29,709
 77,756
 
 114,124
Goodwill 62,543
 432,751
 371,391
 
 866,685
Other intangibles, net 13,883
 199,463
 217,481
 
 430,827
Investment in subsidiaries 1,927,053
 268,708
 91,270
 (2,287,031) 
Intercompany receivable 
 425,574
 295,365
 (720,939) 
Other long-term assets 11,460
 22
 5,283
 
 16,765
Total assets $2,102,976
 $1,507,426
 $1,421,399
 $(3,007,970) $2,023,831
LIABILITIES & SHAREHOLDERS' EQUITY          
Current liabilities          
Trade accounts payable $16,738
 $37,731
 $99,345
 $
 $153,814
Accrued compensation and benefits 13,161
 5,288
 26,848
 
 45,297
Current maturities of debt 10,000
 
 
 
 10,000
Income taxes payable 3,688
 
 (836) 
 2,852
Other current liabilities 13,910
 10,325
 34,331
 
 58,566
Total current liabilities 57,497
 53,344
 159,688
 
 270,529
Long-term debt 385,000
 
 
 
 385,000
Deferred income taxes 88,773
 
 40,307
 
 129,080
Pension and postretirement benefit liabilities 22,195
 
 3,942
 
 26,137
Other long-term liabilities 61,590
 475
 26,752
 
 88,817
Intercompany payable 363,653
 
 357,286
 (720,939) 
Shareholders’ equity 1,124,268
 1,453,607
 833,424
 (2,287,031) 1,124,268
Total liabilities and shareholders’ equity $2,102,976
 $1,507,426
 $1,421,399
 $(3,007,970) $2,023,831

18


CONDENSED CONSOLIDATING BALANCE SHEETS
(In thousands)
  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 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


19


CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(In thousands)

   Three Months Ended November 30, 2012 
   Parent  Guarantors  Non-Guarantors  Eliminations   Consolidated 

Operating Activities

       

Net cash provided by (used in) operating activities

  $(658 $4,779   $8,154   $—      $12,275  

Investing Activities

       

Proceeds from sale of property, plant and equipment

   571    14    392    —       977  

Capital expenditures

   (399  (1,291  (5,999  —       (7,689

Business acquisitions, net of cash acquired

   —      —      (83  —       (83
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

Cash provided by (used in) investing activities

   172    (1,277  (5,690  —       (6,795

Financing Activities

       

Principal repayment of term loans

   (1,250  —      —      —       (1,250

Intercompany loan activity

   (4,991  (3,593  8,584    —       —    

Purchase of treasury shares

   (7,142  —      —      —       (7,142

Stock option exercises, related tax benefits and other

   5,473    —      —      —       5,473  

Cash dividend

   (2,911  —      —      —       (2,911
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

Cash provided by (used in) financing activities

   (10,821  (3,593  8,584    —       (5,830

Effect of exchange rate changes on cash

   —      —      477    —       477  
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

Net increase (decrease) in cash and cash equivalents

   (11,307  (91  11,525    —       127  

Cash and cash equivalents—beginning of period

   12,401    91    55,692    —       68,184  
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

Cash and cash equivalents—end of period

  $1,094   $—     $67,217   $—      $68,311  
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

  Six Months Ended February 28, 2013
  Parent Guarantors Non-Guarantors Eliminations Consolidated
Operating Activities 
 
 
 
 
Net cash provided by operating activities $5,606
 $8,913
 $25,804
 $
 $40,323
Investing Activities 
 
 
 
 
Proceeds from sale of property, plant and equipment 562
 74
 541
 
 1,177
Capital expenditures (668) (2,014) (9,044) 
 (11,726)
Business acquisitions, net of cash acquired (1,350) 
 (83) 
 (1,433)
Cash used in investing activities (1,456) (1,940) (8,586) 
 (11,982)
Financing Activities 
 
 
 
 
Principal repayments on term loan (2,500) 
 
 
 (2,500)
Intercompany loan activity (7,370) (7,064) 14,434
 
 
Purchase of treasury shares (8,821) 
 
 
 (8,821)
Stock option exercises, related tax benefits and other 10,772
 
 
 
 10,772
Cash dividend (2,911) 
 
 
 (2,911)
Cash provided by (used in) financing activities (10,830) (7,064) 14,434
 
 (3,460)
Effect of exchange rate changes on cash 
 
 (2,242) 
 (2,242)
Net increase (decrease) in cash and cash equivalents (6,680) (91) 29,410
 
 22,639
Cash and cash equivalents—beginning of period 12,401
 91
 55,692
 
 68,184
Cash and cash equivalents—end of period $5,721
 $
 $85,102
 $
 $90,823


20


CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(In thousands)

   Three Months Ended November 30, 2011 
   Parent  Guarantors  Non-Guarantors  Eliminations   Consolidated 

Operating Activities

       

Net cash provided by (used in) operating activities

  $(10,089 $7,121   $23,443   $—      $20,475  

Investing Activities

       

Proceeds from sale of property, plant and equipment

   —      68    5,850    —       5,918  

Capital expenditures

   (2,206  (571  (2,818  —       (5,595

Business acquistitions, net of cash acquired

   (290  —      —      —       (290
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

Cash (used in) provided by investing activities

   (2,496  (503  3,032    —       33  

Financing Activities

       

Net borrowings on revolver and other debt

   4,700    —      109    —       4,809  

Intercompany loan activity

   28,060    (6,618  (21,442  —       —    

Purchase of treasury shares

   (20,410  —      —      —       (20,410

Stock option exercises and related tax benefits

   2,782 ��  —      —      —       2,782  

Cash dividend

   (2,748  —      —      —       (2,748
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

Cash (used in) provided by financing activities

   12,384    (6,618  (21,333  —       (15,567

Effect of exchange rate changes on cash

   —      —      (1,043  —       (1,043
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

Net (decrease) increase in cash and cash equivalents

   (201  —      4,099    —       3,898  

Cash and cash equivalents—beginning of period

   872    —      43,349    —       44,221  
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 

Cash and cash equivalents—end of period

  $671   $—     $47,448   $—      $48,119  
  

 

 

  

 

 

  

 

 

  

 

 

   

 

 

 
  Six Months Ended February 29, 2012
  Parent Guarantors Non-Guarantors Eliminations Consolidated
Operating Activities          
Net cash provided by (used in) operating activities $(495) $12,656
 $39,840
 $
 $52,001
Investing Activities 
 
 
 
 
Proceeds from sale of property, plant and equipment 1,541
 113
 6,121
 
 7,775
Capital expenditures (3,142) (1,699) (5,611) 
 (10,452)
Business acquisitions, net of cash acquired (290) 
 (18,617) 
 (18,907)
Cash (used in) provided by investing activities (1,891) (1,586) (18,107) 
 (21,584)
Financing Activities 
 
 
 
 
Net borrowings on revolving credit facilities 10
 
 (177) 
 (167)
Intercompany loan activity 24,565
 (11,070) (13,495) 
 
Purchase of treasury shares (20,410) 
 
 
 (20,410)
Stock option exercises and related tax benefits 5,507
 
 
 
 5,507
Cash dividend (2,748) 
 
 
 (2,748)
Cash (used in) provided by financing activities 6,924
 (11,070) (13,672) 
 (17,818)
Effect of exchange rate changes on cash 
 
 1,625
 
 1,625
Net (decrease) increase in cash and cash equivalents 4,538
 
 9,686
 
 14,224
Cash and cash equivalents—beginning of period 872
 
 43,349
 
 44,221
Cash and cash equivalents—end of period $5,410
 $
 $53,035
 $
 $58,445


21


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 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 fund strategic acquisitions, common stock repurchases and internal growth opportunities.

Our businesses provide a vast array of products and services across multiple customers and geographies which results in significant diversification. The long-term sales growth and profitability of our segments will depend not only on 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 and continuously improve operational excellence.

The comparability of the operating results for the three months ended November 30, 2012 to the prior year period has been impacted by acquisitions changes in foreign currency translation rates and the generally weaker economic conditions that existedhave persisted in the end markets we serve. Listed below are the significant 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

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 weakening of the Euro during the first quarterhalf of fiscal 2013 has, coupled with the recent weakening of the British Pound, have unfavorably impacted our operating results due to the translation of non-U.S. dollar denominated results.


Results of Operations

Global economic

The continued uncertainty experienced in the global economy has created a challenging business environment which has impacted our businesses.  Most of our businesses have experienced softening end market demand over the past several quarters.  Overall,Our results of operations for the three months ended November 30, 2012first half of fiscal 2013 reflect a negative lower sales excluding the impact of acquisitions and changes in foreign exchange rates ("core sales trend assales"), the result of the European recession, a weaker solar market, inventory destocking by OEMs inoriginal equipment manufacturers ("OEM"), construction equipment and off-highway customers and general economic weakness.  We continue to focus on taking the Engineered Solutions segment and a significantly weaker European solar market in the Electrical segment have lead to double digit core sales declines in both segments. However, our two most profitable segments, Industrial and Energy continued to generate positive core sales growth, as a result of maintenance demand in oil & gas, power generation and industrial markets. In response to the overall economic slow-down, we are taking variousappropriate actions to lowerbest align our cost structure with end market demand including headcount reductions in workforce,and the consolidation of facilities and management, as well as product sourcing initiatives. Our priorities during the remaindermanagement.

22


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

   Three Months Ended November 30, 
   2012      2011     

Net sales

  $377     100 $393     100

Cost of products sold

   230     61  240     61
  

 

 

    

 

 

   

Gross profit

   147     39  153     39

Selling, administrative and engineering

   88     23  88     22

Amortization of intangible assets

   8     2  7     2
  

 

 

    

 

 

   

Operating profit

   51     14  57     15

Financing costs, net

   6     2  8     2

Other expense, net

   1     0  1     0
  

 

 

    

 

 

   

Earnings before income tax expense

   44     12  48     12

Income tax expense

   8     2  11     3
  

 

 

    

 

 

   

Net earnings

  $36     10 $37     9
  

 

 

    

 

 

   

Fiscal 2013 first quarter consolidated net

  Three Months Ended Six Months Ended
  February 28,
2013
   February 29,
2012
   February 28,
2013
   February 29,
2012
  
Net sales $370
 100 % $378
 100 % $748
 100% $771
 100%
Cost of products sold 231
 62 % 237
 63 % 461
 62% 477
 62%
Gross profit 139
 38 % 141
 37 % 287
 38% 294
 38%
Selling, administrative and engineering 90
 24 % 85
 22 % 178
 24% 173
 22%
Amortization of intangible assets 8
 2 % 7
 2 % 15
 2% 14
 2%
Operating profit 41
 12 % 49
 13 % 94
 12% 107
 14%
Financing costs, net 6
 2 % 8
 2 % 13
 2% 16
 2%
Other expense, net 
 0 % (1) 0 % 
 0% 1
 0%
Earnings before income tax expense 35
 10 % 42
 11 % 81
 10% 90
 12%
Income tax expense 7
 2 % 10
 3 % 16
 2% 21
 3%
Net earnings $28
 8 % $32
 8 % $65
 8% $69
 9%
                 
Diluted earnings per share $0.38
   $0.43
   $0.87
   $0.94
  
Net sales were $377$370 million 4% lower than and $748 million for the $393three and six months ended February 28, 2013, which represents a 2-3% decrease over the results for the comparable prior year period. Changes in foreign currency exchange rates had a $1 million favorable impact on second quarter sales, but negatively impacted year-to-date comparisons by $5 million. Sales generated by businesses acquired since September 2011, were $15 million and $34 million, respectively, for the three and six month periods ended February 28, 2013. Consolidated core sales declined 6% in the second quarter and 7% year-to-date.  Operating profit for the three and six month periods ended February 28, 2013 was $42 million, and $93 million, respectively, compared to $49 million and $107 million, in the comparable prior year period. Excluding the $18 million year-over-year increase in sales from acquisitions and the $5 million unfavorable impact of foreign currency exchange rate changes, fiscal 2013 first quarter consolidated core sales declined 7% compared to the prior year. Operating profit for the first quarter of fiscal 2013 was $51 million, compared to $57 million in the prior year period.periods.  Reduced sales volumes, unfavorable product mix, a favorable adjustment to an acquisition earn-out provision in the prior year and investments in growth initiatives drove this year-over-year decline in operating profit. We were able to largelysomewhat offset the decline in operating profit with lower borrowing costs and income taxes, resulting in net income and diluted earnings per share down only modestly from the prior year. The changes in sales and operating profit at the segment level are discussed in further detail below.

Segment Results (in millions)

Industrial Segment

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. During the first quarter, core sales growth in the segment was driven by higher global Integrated Solutions activity and steady industrial demand in most regions outside of Western Europe. The Industrial segment focuses on providing customers with innovative lifting solutions, commercializing new products and expanding in faster growing regions and vertical markets. Core sales growth in the second quarter moderated due to tougher prior year comparables, overall economic weakness and reduced demand in Europe. Improved end market demand for industrial tools and existing order backlog in our Integrated Solutions business are expected to drive 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 November 30, 
   2012  2011 

Net sales

  $101   $100  

Operating profit

   27    28  

Operating profit %

   27  28

  Three Months Ended
Six Months Ended
  February 28,
2013

February 29,
2012

February 28,
2013

February 29,
2012
Net sales $99

$98

$200

$199
Operating profit 26

27

53

55
Operating profit % 27%
27%
27%
28%
Fiscal 2013 firstsecond quarter net sales were $101increased $1 million a (1% increase from) to $99 million compared to the comparable prior year period.period, while year to date net sales increased $2 million (1%) to $200 million. Excluding the minor impact of changes in foreign currency rate changes (which unfavorably impacted sales comparisons by $2 million),exchange

23


rates, core sales grew 1% in the second quarter and 2% year-to-date, the result of industrial tool demand in the Americas and Asia Pacific regions, as well as increased 2%.global Integrated Solutions sales. Unfavorable product mix along with incremental G+I investments resulted in slightly lower operating profit margins.


Energy Segment

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. Worldwide requirements for energy and supportive oil prices have encouragedcontinue to drive customers and asset owners to maintain or increase production at existing installations, as well as invest in capital projectsexploration and complete previously deferred maintenance activities. As a result, we are seeing broad-based strength acrossnew production facilities. The non-energy markets served by this segment.segment (including defense, marine and aerospace) have recently seen softening demand, which is expected to continue in the second half of the fiscal year. The following table sets forth the results of operations for the Energy segment (in millions):

   Three Months Ended November 30, 
   2012  2011 

Net sales

  $91   $80  

Operating profit

   15    13  

Operating profit %

   17  16

  Three Months Ended
Six Months Ended
  February 28,
2013

February 29,
2012

February 28,
2013

February 29,
2012
Net sales $81

$79
 $172

$159
Operating profit 10

12
 25

25
Operating profit % 12%
15% 15%
16%
Compared to the prior year, Energy segment net sales for the three months ended November 30, 2012second quarter of fiscal 2013 increased by $11$2 million (13% (2%) to $91$81 million compared and $12 million (8%) to the prior year period.$172 million on a fiscal year-to-date basis. Excluding sales from the Jeyco acquisition ($7 million),and the impact of changes in foreign currency exchange rates, core sales grew 4%declined 1% in the second quarter versus a 1% increase for the first quarterhalf of fiscal 2013. The decline in core sales in the second quarter was the result of continued robustdifficult comparisons (strong North American nuclear maintenance activity in the prior year) and capital spendingweakness in oil & gas, nuclear, power generation and other energynon-energy markets. ImprovedExcluding a $2.5 million favorable adjustment to an acquisition earn out provision in the prior year, second quarter operating profit margins during the quarter were primarily driven bymargin improved as a result of slightly higher sales, favorable sales mix.

product mix and lower incentive compensation costs.

Electrical Segment

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. Weak end market demand in European solar (difficult prior year comparable sales levels overall economic conditions, changesand reductions in government regulations and weak consumer confidence)installation subsidies) was the primary reason for the core sales decline in the quarter. Thisthree and six months ended February 28, 2013. In the second half of the fiscal year we expect improvements in demand for electrical products in the U.S. market due to increased housing activity, which will be partially offset by the loss of certain low margin retail DIY business. Solar sales will likely remain weak during the remainder of the fiscal year due to the current economic challenges in Europe, while the global marine market is expected to generate growth. The Electrical segment continues to focus on driving cost savings from the recently completed North American manufacturing facility consolidation and being responsive to endbalancing spending with market demand. The following table sets forth the results of operations for the Electrical segment (in millions):

   Three Months Ended November 30, 
   2012  2011 

Net sales

  $69   $83  

Operating profit

   8    5  

Operating profit %

   11  6

  Three Months Ended
Six Months Ended
  February 28,
2013

February 29,
2012

February 28,
2013

February 29,
2012
Net sales $70

$77

$139

$160
Operating profit 5

6

13

11
Operating profit % 7%
8% 9%
7%
Electrical segment first quarter net sales were $69for the three and six months ended February 28, 2013 decreased by $7 million 16% lower than (9%) and $21 million (13%), respectively, compared to the comparable prior year quarter. The declineperiods. Excluding the minor impact of changes in foreign currency rates, core sales (16%)declined 9% in the second quarter and 13% year-to-date. This decline was largely dueprimarily attributable to significantly lower solar inverter shipments the result of weak current year demand and aggressive sales promotions in the prior year. In addition, the impact of channel inventory reductions across the segment’s served North American markets and lowerreduced industrial transformer demand contributed todemand. Electrical segment operating profit for the three and six months ended February 28, 2013 was $5 million and $13 million, respectively. Lower sales decline.volumes, unfavorable product mix and $1 million of restructuring costs during the second quarter resulted in reduced operating profit margins. The benefit of prior year restructuring actions, as well as a fire related insurance recovery at ourthe Mastervolt business drove the improvement in operating profit margins.

during the first half of fiscal 2013.




24


Engineered Solutions Segment

The Engineered Solutions segment provides highly engineered position and motion control systems to OEMs in a variety of markets. As anticipated,expected, this segment experienced acontinued to experience core sales declinedeclines in the firstsecond quarter as a result of challenging end market conditions are now broad based acrossand inventory destocking by OEM's in the segment. Europeanheavy-duty truck, off-highway equipment and automotive volumes remain at reduced levels, whilemarkets. We expect these inventory destocking activities to be substantially complete by the global agriculture and North American truck and construction equipment markets have seen recent declines.end of the first quarter of calendar 2013, which should result in improved demand in the second half of fiscal 2013. This segment continues to focus on integrating the recently acquired Turotest and CrossControl businessesintegration of recent acquisitions and reducing its cost structure in lineto be aligned with reduced OEM build rates.market demand. The following table sets forth the results of operations for the Engineered Solutions segment (in millions):

   Three Months Ended November 30, 
   2012  2011 

Net sales

  $116   $129  

Operating profit

   8    19  

Operating profit %

   7  15

Net sales in

  Three Months Ended Six Months Ended
  February 28,
2013
 February 29,
2012
 February 28,
2013
 February 29,
2012
Net sales $121
 $124
 $237
 $253
Operating profit 8
 13
 16
 32
Operating profit % 7% 11% 7% 13%
Compared to the prior year, Engineered Solutions segment net sales decreased by $13$3 million (10% (2%) to $121 million and $16 million (6%) to $237 million in the three and six months ended February 28, 2013, respectively. Excluding foreign currency rate changes and sales from $129acquired businesses ($12 million and $23 million, respectively for the three and six months ended November 30, 2011 to $116 million for the three months ended November 30, 2012. Excluding the unfavorable impact of changes in foreign currency exchange rates ($3 million) and the $11 million of sales from recent acquisitions,February 28, 2013), core sales declined 17%. First12% and 15% respectively, for the second quarter netand first half of fiscal 2013. The core sales levels reflect concerted actions by ourdecline was broad based across most served end markets and geographies, and primarily reflected OEM customers to reduce their inventory levelscustomer destocking and production schedules in response to lower demand at the dealer level.challenging economic conditions. Segment operating profit declined from the prior year period, as the impact of restructuring costs and the reduced sales volume (under-absorption of operating costs) was only partially offset by lower incentive compensation costs.

General Corporate

General corporate expenses were $7$7 million and $8$14 million for the three and six months ended November 30,February 28, 2013, respectively and $8 million and $16 million for the three and six months ended February 29, 2012 and 2011,, respectively. The reduction isDespite continued investments in growth initiatives, lower corporate expenses are primarily due to lowerreduced provisions for incentive compensation costs during the quarter.

compensation.

Financing Costs, net

All debt is considered to be for general corporate purposes and therefore financing costs have not been allocated to our segments. FinancingNet financing costs net were $6$6 million and $8$13 million for the three and six months ended November 30, 2012February 28, 2013, respectively and 2011, respectively.$8 million and $16 million, respectively, for the comparable prior year periods. The reduction in interest expense in the first quarter of 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 was 18.5%20.4% and 23.1%19.4% for the three and six months ended November 30, 2012February 28, 2013, respectively, and 2011, respectively.23.0% and 23.1% for the comparable prior year periods. The decrease in the effective tax rate for the three months ended November 30, 2012, relative to the prior year, reflects the benefits of tax minimization planning, increased foreign tax credits and the utilization of net operating losses.

See Note 10, "Income Taxes" for further information.

Cash Flows

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

   Three Months
Ended
November 30,
 
   2012  2011 

Net cash provided by operating activities

  $12   $20  

Net cash used in investing activities

   (7  —    

Net cash used in financing activities

   (6  (15

Effect of exchange rates on cash

   1    (1
  

 

 

  

 

 

 

Net increase in cash and cash equivalents

  $—     $4  
  

 

 

  

 

 

 

  Six Months Ended
  February 28,
2013
 February 29,
2012
Net cash provided by operating activities $40
 $52
Net cash used in investing activities (12) (22)
Net cash used in financing activities (3) (18)
Effect of exchange rates on cash (2) 2
Net increase in cash and cash equivalents $23
 $14

25


Cash flows from operating activities during the threesix months ended November 30, 2012February 28, 2013 were $12$40 million, the result of net earnings, offset by the payment of $17 million of fiscal 2012 incentive compensation costs reduced accounts payable and increased inventory levels.an $12 million increase in working capital accounts. These operating cash flows funded the repurchase of approximately 0.3 million shares of the Company’s common stock ($7 million)($9 million) under the stock buyback program, our $3$3 million annual dividend and $8$12 million of capital expenditures.

Cash flows from operating activities during the threesix months ended November 30, 2011February 29, 2012 were $20$52 million, the result of net earnings, offset by the payment of $28$28 million of fiscal 2011 incentive compensation costs and increased accounts receivable and inventory levels. These operatingworking capital requirements. Operating cash flows and borrowings under the Senior Credit Facility funded the repurchase of approximately 1 million shares of the Company’s common stock ($($20 million).million) under the stock buyback program and the $19 million purchase price for the Jeyco acquisition. Proceeds from the sale of property, plant and equipment (which included the sale-leaseback of certain equipment) more than offsetequipment and the $6sale of a vacant facility) were $8 million of, while related capital expenditures during the first quarter of fiscal 2012.

were $10 million.

Primary Working Capital Management

We use primary working capital as a percentage of sales (PWC %) as a key indicator of working capital 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 November 30 (in millions):

   2012  PWC%  2011  PWC% 

Accounts receivable, net

  $232    15 $227    15

Inventory, net

   225    15  219    14

Accounts payable

   (164  -11  (163  -11
  

 

 

  

 

 

  

 

 

  

 

 

 

Net primary working capital

  $293    19 $283    18
  

 

 

  

 

 

  

 

 

  

 

 

 

Our primary working capital and PWC % increased on a year-over-year basis as a result of increased inventory, resulting from our inability to quickly reduce incoming purchases to balance reduced customer production levels.

  February 28,
2013
 PWC% February 29,
2012
 PWC%
Accounts receivable, net $239
 16 % $239
 16 %
Inventory, net 218
 15 % 219
 14 %
Accounts payable (154) (10)% (159) (10)%
Net primary working capital $303
 21 % $299
 20 %

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, 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 November 30, 2012,February 28, 2013, we had $68$91 million of cash and cash equivalents and $596$596 million of available liquidity under our Senior Credit Facility. See Note 6, “Debt” for further discussion on the 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.

See Note 6, “Debt” in the notes to the condensed consolidated financial statements for further discussion on the Senior Credit Facility.

Commitments and Contingencies

The Company has facilities in numerous geographic locations that are subject to a range of environmental laws and regulations. Environmental expenditures over the past two years have not been material. Management believes that such costs will not have a material adverse effect on the Company’s financial 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 obligations. The discounted present value of future minimum lease payments for these leases was $12$12 million at November 30, 2012.

February 28, 2013.

We had outstanding letters of credit of approximately $11$11 million and $8$9 million at November 30, 2012February 28, 2013 and August 31, 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, 2012, and, as of November 30, 2012,February 28, 2013, have not materially changed.

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.


26




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 exposure to market risk during5.625% 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 6, “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 November 30, 2012. For a discussion ofFebruary 28, 2013. From time to time, we may enter into interest rate swap agreements to manage our exposure to marketinterest rate changes. At February 28, 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 referrelating to Item 7A, Quantitativereceipts from customers, payments to suppliers and Qualitative Disclosures about Market Risk, containedintercompany transactions denominated in foreign currencies. Under certain conditions, we enter into hedging transactions, primarily forward foreign currency swaps, that enable us to mitigate the potential adverse impact of foreign currency exchange rate risk (see Note 8, “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 Annual Reportresults 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 Form 10-Kthe translation of our results of operations, sales and operating profit were remeasured assuming a ten percent decrease in foreign exchange rates compared with the U.S. dollar. Using this method, sales and operating profit would have been $18 million and $2 million lower, respectively, for the fiscal yearthree months ended August 31, 2012.

February 28, 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 ten percent decline in foreign currency exchange rates on our February 28, 2013 financial position would result in a
$67 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 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 price fluctuations, which could have a negative impact on our results. We strive to pass along such commodity price increases to customers to avoid profit margin erosion and utilize LEAD initiatives to further mitigate the 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.

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 November 30, 2012February 28, 2013 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.


27


PART II—OTHER INFORMATION

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

In September 2011, our Board of Directors authorized a stock repurchase program to acquire up to 7,000,000 shares of the Company’s outstanding Class A common stock. The following table presents information regarding the repurchase of common stock during the three months ended November 30, 2012.February 28, 2013. All of the shares were repurchased as part of the publicly announced program.

   Total Number
of Shares
Purchased
   Average Price
Paid per Share
   Maximum
Number of
Shares That
May Yet Be
Purchased
Under the
Program
 

September 1 to September 30, 2012

   —       —       4,341,249  

October 1 to October 31, 2012

   159,200    $27.95     4,182,049  

November 1 to November 30, 2012

   100,000     26.84     4,082,049  
  

 

 

   

 

 

   

Total

   259,200     27.53    
  

 

 

   

 

 

   
  
Total Number
of Shares
Purchased
 
Average Price
Paid per Share
 
Maximum
Number of
Shares That
May Yet Be
Purchased
Under the
Program
December 1 to December 31, 2012 25,000
 27.50
 4,057,049
January 1 to January 31, 2013 36,043
 27.46
 4,021,006
February 1 to February 28, 2013 
 
 4,021,006
Total 61,043
 27.48
  

Item 6 – Exhibits

(a) Exhibits

See “Index to Exhibits” on page 26,30, which is incorporated herein by reference.


28


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)
Date: April 8, 2013By:
/S/ ANDREW G. LAMPEREUR
Andrew G. Lampereur
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)


29


ACTUANT CORPORATION
(the “Registrant”)
(Commission File No. 1-11288)
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED February 28, 2013
INDEX TO EXHIBITS
  ACTUANT CORPORATION
 (Registrant)
Date: January 8, 2013By:

/S/ ANDREW G. LAMPEREUR

Andrew G. Lampereur
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)

ACTUANT CORPORATION

(the “Registrant”)

(Commission File No. 1-11288)

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED November 30, 2012

INDEX TO EXHIBITS

Exhibit

Description

Incorporated

Herein

By Reference

To

Filed

Herewith

 
ExhibitDescription
Incorporated
Herein
By Reference
To
Filed
Herewith
31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes- Oxley Act of 2002 X
  X 
31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X
  X 
32.1 Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes- Oxley Act of 2002 X
  X 
32.2 Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X
  X 
101*101 The following materials from the Actuant Corporation Form 10-Q for the quarter ended November 30, 2012February 28, 2013 formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Consolidated Statements of Earnings, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows and (v) the Notes to Condensed Consolidated Financial Statements.  X

*
Furnished herewith

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