| Document and Entity Information (USD $) | |||
| 3 Months Ended
Mar. 31, 2010 | Apr. 29, 2010
| Jun. 30, 2009
| |
| Document and Entity Information [Abstract] | |||
| Entity Registrant Name | AMETEK INC/ | ||
| Entity Central Index Key | 0001037868 | ||
| Document Type | 10-Q | ||
| Document Period End Date | 2010-03-31 | ||
| Amendment Flag | false | ||
| Document Fiscal Year Focus | 2,010 | ||
| Document Fiscal Period Focus | Q1 | ||
| Current Fiscal Year End Date | --12-31 | ||
| Entity Well-known Seasoned Issuer | Yes | ||
| Entity Voluntary Filers | No | ||
| Entity Current Reporting Status | Yes | ||
| Entity Filer Category | Large Accelerated Filer | ||
| Entity Public Float | $3,716,907,826 | ||
| Entity Common Stock, Shares Outstanding | 106,352,475 |
| Consolidated Statement of Income (Unaudited) (USD $) | ||
| In Thousands, except Per Share data | 3 Months Ended
Mar. 31, 2010 | 3 Months Ended
Mar. 31, 2009 |
| Consolidated Statement of Income | ||
| Net sales | $556,662 | $552,866 |
| Operating expenses: | ||
| Cost of sales, excluding depreciation | 375,724 | 370,643 |
| Selling, general and administrative | 67,543 | 64,530 |
| Depreciation | 10,949 | 11,491 |
| Total operating expenses | 454,216 | 446,664 |
| Operating income | 102,446 | 106,202 |
| Other expenses: | ||
| Interest expense | (16,754) | (17,555) |
| Other, net | (515) | (23) |
| Income before income taxes | 85,177 | 88,624 |
| Provision for income taxes | 27,232 | 29,569 |
| Net income | $57,945 | $59,055 |
| Basic earnings per share | 0.54 | 0.55 |
| Diluted earnings per share | 0.54 | 0.55 |
| Weighted average common shares outstanding: | ||
| Basic shares | 106,619 | 106,420 |
| Diluted shares | 107,570 | 107,321 |
| Dividends declared and paid per share | 0.06 | 0.06 |
| Consolidated Balance Sheet (USD $) | ||
| In Thousands | Mar. 31, 2010
| Dec. 31, 2009
|
| Current assets: | ||
| Cash and cash equivalents | $255,632 | $246,356 |
| Marketable securities | 5,296 | 4,994 |
| Receivables, less allowance for possible losses | 356,187 | 331,383 |
| Inventories | 305,960 | 311,542 |
| Deferred income taxes | 26,090 | 30,669 |
| Other current assets | 47,116 | 44,486 |
| Total current assets | 996,281 | 969,430 |
| Property, plant and equipment, net | 298,207 | 310,053 |
| Goodwill | 1,261,030 | 1,277,291 |
| Other intangibles, net of accumulated amortization | 504,407 | 521,888 |
| Investments and other assets | 165,092 | 167,370 |
| Total assets | 3,225,017 | 3,246,032 |
| Current liabilities: | ||
| Short-term borrowings and current portion of long-term debt | 80,221 | 85,801 |
| Accounts payable | 203,532 | 191,779 |
| Income taxes payable | 27,532 | 13,345 |
| Accrued liabilities | 138,043 | 133,357 |
| Total current liabilities | 449,328 | 424,282 |
| Long-term debt | 946,448 | 955,880 |
| Deferred income taxes | 204,849 | 206,354 |
| Other long-term liabilities | 98,512 | 92,492 |
| Total liabilities | 1,699,137 | 1,679,008 |
| Stockholders' equity: | ||
| Common stock | 1,112 | 1,110 |
| Capital in excess of par value | 232,250 | 224,057 |
| Retained earnings | 1,552,019 | 1,500,471 |
| Accumulated other comprehensive loss | (108,548) | (75,281) |
| Treasury stock | (150,953) | (83,333) |
| Total stockholders' equity | 1,525,880 | 1,567,024 |
| Total liabilities and stockholders' equity | $3,225,017 | $3,246,032 |
| Condensed Consolidated Statement of Cash Flows (Unaudited) (USD $) | ||
| In Thousands | 3 Months Ended
Mar. 31, 2010 | 3 Months Ended
Mar. 31, 2009 |
| Operating activities: | ||
| Net income | $57,945 | $59,055 |
| Adjustments to reconcile net income to total operating activities: | ||
| Depreciation and amortization | 16,787 | 16,641 |
| Deferred income tax expense (benefit) | 3,862 | (2,464) |
| Share-based compensation expense | 3,601 | 2,715 |
| Net change in assets and liabilities, net of acquisitions | 10,053 | 34,786 |
| Pension contribution and other | (385) | (343) |
| Total operating activities | 91,863 | 110,390 |
| Investing activities: | ||
| Additions to property, plant and equipment | (5,811) | (6,106) |
| Purchases of businesses, net of cash acquired and other | (3,225) | (38,213) |
| Total investing activities | (9,036) | (44,319) |
| Financing activities: | ||
| Net change in short-term borrowings | (797) | (7,332) |
| Reduction in long-term borrowings | (1,948) | |
| Repurchases of common stock | (67,345) | |
| Cash dividends paid | (6,348) | (6,406) |
| Excess tax benefits from share-based payments | 1,584 | 244 |
| Proceeds from employee stock plans and other | 2,486 | 1,390 |
| Total financing activities | (70,420) | (14,052) |
| Effect of exchange rate changes on cash and cash equivalents | (3,131) | (3,247) |
| Increase in cash and cash equivalents | 9,276 | 48,772 |
| Cash and cash equivalents: | ||
| As of January 1 | 246,356 | 86,980 |
| As of March 31 | $255,632 | $135,752 |
| Basis of Presentation | |
| 3 Months Ended
Mar. 31, 2010 | |
| Basis of Presentation [Abstract] | |
| Basis of Presentation | 1. Basis of Presentation The accompanying consolidated financial statements are unaudited. AMETEK, Inc. (the Company) believes that all adjustments (which primarily consist of normal recurring accruals) necessary for a fair presentation of the consolidated financial position of the Company at March31, 2010, the consolidated results of its operations and its cash flows for the three months ended March31, 2010 and 2009 have been included. Quarterly results of operations are not necessarily indicative of results for the full year. The accompanying financial statements should be read in conjunction with the financial statements and related notes presented in the Companys Annual Report on Form 10-K for the year ended December31, 2009 as filed with the Securities and Exchange Commission (SEC). |
| Recent Accounting Pronouncements | |
| 3 Months Ended
Mar. 31, 2010 | |
| Recent Accounting Pronouncements [Abstract] | |
| Recent Accounting Pronouncements | 2. Recent Accounting Pronouncements In January2010, the FASB issued Accounting Standards Update (ASU) No.2010-06, Fair value Measurements and Disclosures (ASU 2010-06). ASU 2010-06 provides amendments that clarify existing disclosures and require new disclosures related to fair value measurements providing greater disaggregated information on each class of assets and liabilities and more robust disclosures on transfers between levels 1 and 2 and activity in level 3 fair value measurements. The Company adopted the applicable provisions within ASU 2010-06 effective January1, 2010. See Note 3. The Company is currently evaluating the impact of adopting the level 3 disclosures of ASU 2010-06 that are effective for fiscal years beginning after December15, 2010 and for interim periods within those fiscal years. In February2010, the FASB issued ASU No.2010-09, Subsequent Events (ASU 2010-09). ASU 2010-09 removes the requirement for an SEC filer to disclose a date in both the issued and revised financial statements for which the Company evaluated events that occur after the balance sheet date but before financial statements are issued or are available to be issued. ASU 2010-09 is effective as of February2010. |
| Fair Value Measurement | |
| 3 Months Ended
Mar. 31, 2010 | |
| Fair Value Measurement [Abstract] | |
| Fair Value Measurement | 3. Fair Value Measurement The Company utilizes a valuation hierarchy for disclosure of the inputs to the valuations used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted)in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Companys own assumptions used to measure assets and liabilities at fair value. A financial asset or liabilitys classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. At March31, 2010, $14.1million of the Companys cash and cash equivalents and marketable securities are valued as level 1 investments. In addition, the Company held $4.4million of marketable securities in an institutional diversified equity securities mutual fund, which are valued as level 2 investments. The Company also held $9.1million of investments in fixed-income securities valued as level 2 investments. The marketable securities are shown as a separate line on the consolidated balance sheet. The fixed-income securities are included in the investments and other assets line of the consolidated balance sheet. For the three months ended March31, 2010, gains and losses on the investments noted above were not significant. No transfers between level 1 and level 2 investments occurred in the three months ended March31, 2010. Fair value of the institutional equity securities mutual fund was estimated using the net asset value of the Companys ownership interests in the funds capital. The mutual fund seeks to provide long-term growth of capital by investing primarily in equity securities traded on U.S. exchanges and issued by large, established companies across many business sectors. Fair value of the fixed-income securities was estimated using observable market inputs and the securities are primarily corporate debt instruments and U.S. Government securities. There are no restrictions on the Companys ability to redeem these equity and fixed-income securities investments. |
| Hedging Activities | |
| 3 Months Ended
Mar. 31, 2010 | |
| Hedging Activities [Abstract] | |
| Hedging Activities | 4. Hedging Activities The Company has designated certain foreign-currency-denominated long-term debt as hedges of the net investment in certain foreign operations. These net investment hedges are the Companys British-pound-denominated long-term debt and Euro-denominated long-term debt, pertaining to certain European acquisitions whose functional currencies are either the British pound or the Euro. These acquisitions were financed by foreign-currency-denominated borrowings under the Companys revolving credit facility and subsequently refinanced with long-term private placement debt. These borrowings were designed to create net investment hedges in each of the foreign subsidiaries on their respective dates of acquisition. On the respective dates of acquisition, the Company designated the British pound- and Euro-denominated loans referred to above as hedging instruments to offset foreign exchange gains or losses on the net investment in the acquired business due to changes in the British pound and Euro exchange rates. These net investment hedges were evidenced by managements documentation supporting the contemporaneous hedge designation on the acquisition dates. Any gain or loss on the hedging instrument following hedge designation (the debt), is reported in accumulated other comprehensive income in the same manner as the translation adjustment on the investment based on changes in the spot rate, which is used to measure hedge effectiveness. At March31, 2010, the Company had $136.6million of British pound-denominated loans, which are designated as a hedge against the net investment in foreign subsidiaries acquired in 2004 and 2003. At March31, 2010, the Company had $67.5million of Euro-denominated loans, which were designated as a hedge against the net investment in a foreign subsidiary acquired in 2005. As a result of these British pound- and Euro-denominated loans being designated and effective as net investment hedges, $12.9million of currency remeasurement gains have been included in the foreign currency translation component of other comprehensive income at March31, 2010. |
| Earnings Per Share | |
| 3 Months Ended
Mar. 31, 2010 | |
| Earnings Per Share [Abstract] | |
| Earnings Per Share | 5. Earnings Per Share The calculation of basic earnings per share is based on the weighted average number of common shares considered outstanding during the periods. The calculation of diluted earnings per share reflects the effect of all potentially dilutive securities (principally outstanding common stock options and restricted stock grants). The number of weighted average shares used in the calculation of basic earnings per share and diluted earnings per share were as follows: Three Months Ended March 31, 2010 2009 (In thousands) Weighted average shares: Basic shares 106,619 106,420 Stock option and awards plans 951 901 Diluted shares 107,570 107,321 |
| Fourth Quarter of 2008 Restructuring Charges and Asset Write-Downs | |
| 3 Months Ended
Mar. 31, 2010 | |
| Fourth Quarter of 2008 Restructuring Charges and Asset Write-Downs [Abstract] | |
| Fourth Quarter of 2008 Restructuring Charges and Asset Write-Downs | 6. Fourth Quarter of 2008 Restructuring Charges and Asset Write-Downs During the fourth quarter of 2008, the Company recorded pre-tax charges totaling $40.0 million, which had the effect of reducing net income by $27.3million ($0.25 per diluted share). These charges include restructuring costs for employee reductions and facility closures ($32.6 million), as well as asset write-downs ($7.4million). The charges included $30.1million for severance costs for more than 10% of the Companys workforce and $1.5million for lease termination costs associated with the closure of certain facilities. Of the $40.0million in charges, $32.9million of the restructuring charges and asset write-downs were recorded in cost of sales and $7.1million of the restructuring charges and asset write-downs were recorded in Selling, general and administrative expenses. The restructuring charges and asset write-downs were reported in 2008 segment operating income as follows: $20.4million in Electronic Instruments Group (EIG), $19.4 million in Electromechanical Group (EMG) and $0.2million in Corporate administrative and other expenses. The restructuring costs for employee reductions and facility closures relate to plans established by the Company in 2008 as part of cost reduction initiatives that were broadly implemented across the Companys various businesses during fiscal 2009. The restructuring costs resulted from the consolidation of manufacturing facilities, the migration of production to low cost locales and a general reduction in workforce in response to lower levels of expected sales volumes in certain of the Companys businesses. The following table provides a rollforward of the remaining accruals established in the fourth quarter of 2008 for restructuring charges and asset write-downs: Restructuring Severance Facility Closures Total (In millions) Restructuring accruals at December31, 2009 $ 12.2 $ 1.0 $ 13.2 Utilization (1.5 ) (0.2 ) (1.7 ) Foreign currency translation and other (0.5 ) (0.5 ) Restructuring accruals at March31, 2010 $ 10.2 $ 0.8 $ 11.0 |
| Goodwill | |
| 3 Months Ended
Mar. 31, 2010 | |
| Goodwill [Abstract] | |
| Goodwill | 7. Goodwill The changes in the carrying amounts of goodwill by segment were as follows: EIG EMG Total (In millions) Balance at December31, 2009 $ 746.9 $ 530.4 $ 1,277.3 Goodwill acquired during the year 3.3 3.3 Purchase price allocation adjustments and other 27.4 (24.0 ) 3.4 Foreign currency translation adjustments (15.2 ) (7.8 ) (23.0 ) Balance at March31, 2010 $ 762.4 $ 498.6 $ 1,261.0 |
| Inventories | |
| 3 Months Ended
Mar. 31, 2010 | |
| Inventories [Abstract] | |
| Inventories | 8. Inventories March 31, December 31, 2010 2009 (In thousands) Finished goods and parts $ 45,221 $ 46,777 Work in process 65,747 65,752 Raw materials and purchased parts 194,992 199,013 Total inventories $ 305,960 $ 311,542 |
| Comprehensive Income | |
| 3 Months Ended
Mar. 31, 2010 | |
| Comprehensive Income [Abstract] | |
| Comprehensive Income | 9. Comprehensive Income Comprehensive income includes all changes in stockholders equity during a period except those resulting from investments by and distributions to stockholders. The components of comprehensive income were as follows: Three Months Ended March 31, 2010 2009 (In thousands) Net income $ 57,945 $ 59,055 Foreign currency translation adjustment (29,107 ) (17,095 ) Foreign currency net investment hedge* (4,393 ) (1,714 ) Other 233 (90 ) Total comprehensive income $ 24,678 $ 40,156 * Represents the net gains and losses on the Companys investment in certain foreign operations in excess of the net gains and losses from the non-derivative foreign-currency-denominated long-term debt. These debt instruments were designated as hedging instruments to offset foreign exchange gains or losses on the net investment in certain foreign operations. |
| Share-Based Compensation | |
| 3 Months Ended
Mar. 31, 2010 | |
| Share-Based Compensation [Abstract] | |
| Share-Based Compensation | 10. Share-Based Compensation Total share-based compensation expense was as follows: Three Months Ended March 31, 2010 2009 (In thousands) Stock option expense $ 1,638 $ 1,286 Restricted stock expense 1,963 1,429 Total pre-tax expense 3,601 2,715 Related tax benefit (1,007 ) (840 ) Reduction of net income $ 2,594 $ 1,875 Pre-tax share-based compensation expense is included in either cost of sales, or selling, general and administrative expenses, depending on where the recipients cash compensation is reported. |
| Income Taxes | |
| 3 Months Ended
Mar. 31, 2010 | |
| Income Taxes [Abstract] | |
| Income Taxes | 11. Income Taxes At March31, 2010, the Company had gross unrecognized tax benefits of $29.0million, of which $26.1million, if recognized, would impact the effective tax rate. The following is a reconciliation of the liability for uncertain tax positions (in millions): Balance at December31, 2009 $ 26.5 Additions for tax positions 3.1 Reductions for tax positions (0.6 ) Balance at March31, 2010 $ 29.0 The Company recognizes interest and penalties accrued related to uncertain tax positions in income tax expense. The amounts recognized in income tax expense for interest and penalties during the three months ended March31, 2010 and 2009 were not significant. |
| Retirement and Pension Plans | |
| 3 Months Ended
Mar. 31, 2010 | |
| Retirement and Pension Plans [Abstract] | |
| Retirement and Pension Plans | 12. Retirement and Pension Plans The components of net periodic pension benefit expense were as follows: Three Months Ended March 31, 2010 2009 (In thousands) Defined benefit plans: Service cost $ 1,186 $ 1,144 Interest cost 6,897 6,861 Expected return on plan assets (10,219 ) (8,673 ) Amortization of net actuarial loss and other 1,993 3,308 Pension (income)expense (143 ) 2,640 Other plans: Defined contribution plans 3,056 3,529 Foreign plans and other 1,057 1,005 Total other plans 4,113 4,534 Total net pension expense $ 3,970 $ 7,174 For the three months ended March31, 2010 and 2009, contributions to our defined benefit pension plans were not significant. |
| Financial Instruments | |
| 3 Months Ended
Mar. 31, 2010 | |
| Financial Instruments [Abstract] | |
| Financial Instruments | 13. Financial Instruments The estimated fair values of the Companys financial instruments are compared below to the recorded amounts at March31, 2010 and December31, 2009. Cash, cash equivalents and marketable securities are recorded at fair value at March31, 2010 and December31, 2009 in the accompanying consolidated balance sheet. Asset (Liability) March 31, 2010 December 31, 2009 Recorded Recorded Amount Fair Value Amount Fair Value (In thousands) Fixed-income investments $ 9,103 $ 9,103 $ 8,883 $ 8,883 Short-term borrowings (3,425 ) (3,425 ) (4,076 ) (4,076 ) Long-term debt (including current portion) (1,023,244 ) (1,068,405 ) (1,037,605 ) (1,084,877 ) The fair value of fixed-income investments is based on quoted market prices. The fair value of short-term borrowings approximates the carrying value. The Companys long-term debt is all privately-held with no public market for this debt, therefore, the fair value of long-term debt was computed based on comparable current market data for similar debt instruments. |
| Product Warranties | |
| 3 Months Ended
Mar. 31, 2010 | |
| Product Warranties [Abstract] | |
| Product Warranties | 14. Product Warranties The Company provides limited warranties in connection with the sale of its products. The warranty periods for products sold vary widely among the Companys operations, but for the most part do not exceed one year. The Company calculates its warranty expense provision based on past warranty experience and adjustments are made periodically to reflect actual warranty expenses. Changes in accrued product warranty obligation were as follows: Three Months Ended March 31, 2010 2009 (In thousands) Balance at the beginning of the period $ 16,035 $ 16,068 Accruals for warranties issued during the period 2,723 2,017 Settlements made during the period (2,732 ) (2,028 ) Warranty accruals related to new businesses and other (350 ) (313 ) Balance at the end of the period $ 15,676 $ 15,744 Certain settlements of warranties made during the period were for specific nonrecurring warranty obligations. Product warranty obligations are reported as current liabilities in the consolidated balance sheet. |
| Reportable Segments | |
| 3 Months Ended
Mar. 31, 2010 | |
| Reportable Segments [Abstract] | |
| Reportable Segments | 15. Reportable Segments The Company has two reportable segments, the Electronic Instruments Group and the Electromechanical Group. The Company manages, evaluates and aggregates its operating segments for segment reporting purposes primarily on the basis of product type, production processes, distribution methods and management organizations. At March31, 2010, there were no significant changes in identifiable assets of reportable segments from the amounts disclosed at December31, 2009, nor were there any significant changes in the basis of segmentation or in the measurement of segment operating results. Operating information relating to the Companys reportable segments for the three months ended March31, 2010 and 2009 can be found in the table within PartI, Item2 Managements Discussion and Analysis of Financial Condition and Results of Operations of this Report. |
