Exhibit 99.2
CRANE CO.
Consolidated Income Statement Data
(in thousands, except per share data)
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2005 | 2004 | 2005 | 2004 | |||||||||||||
Net Sales: | ||||||||||||||||
Aerospace & Electronics | $ | 145,202 | $ | 138,767 | $ | 554,445 | $ | 511,624 | ||||||||
Engineered Materials | 69,274 | 62,942 | 304,824 | 276,186 | ||||||||||||
Merchandising Systems | 36,248 | 43,086 | 166,298 | 169,205 | ||||||||||||
Fluid Handling | 235,456 | 222,507 | 953,961 | 861,937 | ||||||||||||
Controls | 20,248 | 18,515 | 82,143 | 71,950 | ||||||||||||
Intersegment Elimination | (90 | ) | (215 | ) | (422 | ) | (567 | ) | ||||||||
Total Net Sales | $ | 506,338 | $ | 485,602 | $ | 2,061,249 | $ | 1,890,335 | ||||||||
Operating Profit: | ||||||||||||||||
Aerospace & Electronics | $ | 25,457 | $ | 24,928 | $ | 86,136 | $ | 92,650 | ||||||||
Engineered Materials | 12,147 | 9,476 | 62,982 | 54,072 | ||||||||||||
Merchandising Systems | 1,434 | 1,957 | 12,797 | 9,722 | ||||||||||||
Fluid Handling | 22,545 | 12,659 | 76,132 | 52,152 | ||||||||||||
Controls | 1,986 | 1,714 | 7,274 | 5,529 | ||||||||||||
Corporate | (8,454 | ) | (4,493 | ) | (31,699 | ) | (27,821 | ) | ||||||||
Operating Profit before Income (Charge) | 55,115 | 46,241 | 213,622 | 186,304 | ||||||||||||
Asbestos and Environmental Income (Charge) | — | 14,019 | — | (347,794 | ) | |||||||||||
Total Operating Profit (Loss) | 55,115 | 60,260 | 213,622 | (161,490 | ) | |||||||||||
Interest Income | 1,368 | 121 | 2,372 | 1,366 | ||||||||||||
Interest Expense | (5,391 | ) | (5,114 | ) | (22,416 | ) | (23,161 | ) | ||||||||
Miscellaneous- Net | 101 | 15,178 | 2,946 | 15,115 | ||||||||||||
Income (Loss) Before Income Taxes | 51,193 | 70,445 | 196,524 | (168,170 | ) | |||||||||||
Provision (Benefit) for Income Taxes | 15,870 | 24,075 | 60,487 | (62,749 | ) | |||||||||||
Net Income (Loss) | $ | 35,323 | $ | 46,370 | $ | 136,037 | $ | (105,421 | ) | |||||||
Share Data: | ||||||||||||||||
Net Income (Loss) Per Diluted Share | $ | 0.58 | $ | 0.78 | $ | 2.25 | $ | (1.78 | ) | |||||||
Average Diluted Shares Outstanding | 60,928 | 59,750 | 60,413 | 59,251 | ||||||||||||
Average Basic Shares Outstanding | 60,233 | 59,123 | 59,816 | 59,251 | ||||||||||||
Supplemental Data: | ||||||||||||||||
Cost of Sales | $ | 347,630 | $ | 328,531 | $ | 1,418,662 | $ | 1,646,668 | ||||||||
Selling, General & Administrative | 103,593 | 96,811 | 428,965 | 405,157 | ||||||||||||
Depreciation and Amortization * | 12,754 | 13,732 | 55,715 | 55,716 |
* | Amount included within cost of sales and selling, general & administrative costs. |
CRANE CO.
Condensed Consolidated Balance Sheets
(in thousands)
December 31, 2005 | December 31, 2004 | |||||
ASSETS | ||||||
Current Assets | ||||||
Cash and Cash Equivalents | $ | 180,392 | $ | 50,727 | ||
Accounts Receivable | 289,521 | 308,140 | ||||
Inventories | 272,354 | 284,291 | ||||
Other Current Assets | 56,128 | 59,648 | ||||
Total Current Assets | 798,395 | 702,806 | ||||
Property, Plant and Equipment | 263,791 | 287,596 | ||||
Insurance Receivable - Asbestos | 224,600 | 245,160 | ||||
Other Assets | 284,345 | 301,865 | ||||
Goodwill | 568,355 | 579,081 | ||||
Total Assets | $ | 2,139,486 | $ | 2,116,508 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||
Current Liabilities | ||||||
Current Maturities of Long-Term Debt and Loans Payable | $ | 254 | $ | 371 | ||
Accounts Payable | 149,647 | 161,477 | ||||
Current Asbestos Liability | 55,000 | 67,800 | ||||
Accrued Liabilities | 174,366 | 157,730 | ||||
Income Taxes | 19,322 | 22,636 | ||||
Total Current Liabilities | 398,589 | 410,014 | ||||
Long-Term Debt | 293,248 | 296,592 | ||||
Deferred Income Taxes | 71,406 | 71,367 | ||||
Long-Term Asbestos Liability | 526,830 | 581,914 | ||||
Pension, Postretirement and Other Liabilities | 96,119 | 92,927 | ||||
Shareholders’ Equity | 753,294 | 663,694 | ||||
Total Liabilities and Shareholders’ Equity | $ | 2,139,486 | $ | 2,116,508 | ||
CRANE CO.
Condensed Consolidated Statements of Cash Flows
(in thousands)
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2005 | 2004 | 2005 | 2004 | |||||||||||||
Operating Activities: | ||||||||||||||||
Net income (loss) | $ | 35,323 | $ | 46,370 | $ | 136,037 | $ | (105,421 | ) | |||||||
Charges for asbestos and environmental - net of tax | — | (9,112 | ) | — | 229,272 | |||||||||||
Gain on divestiture | — | (9,468 | ) | — | (9,468 | ) | ||||||||||
Income from joint venture | (1,489 | ) | (1,313 | ) | (5,965 | ) | (4,041 | ) | ||||||||
Depreciation and amortization | 12,754 | 13,732 | 55,715 | 55,716 | ||||||||||||
Cash provided by (used for) operating working capital | 40,095 | 11,646 | 5,032 | (27,403 | ) | |||||||||||
Other | 11,474 | 14,454 | 26,139 | 10,365 | ||||||||||||
Subtotal | 98,157 | 66,309 | 216,958 | 149,020 | ||||||||||||
Payments for asbestos-related fees and costs, net | (20,782 | ) | (9,720 | ) | (45,338 | ) | (28,056 | ) | ||||||||
(Payment) refund associated with terminated Master Settlement Agreement | — | (10,000 | ) | 9,925 | (10,000 | ) | ||||||||||
Total provided from operating activities | 77,375 | 46,589 | 181,545 | 110,964 | ||||||||||||
Investing Activities: | ||||||||||||||||
Capital expenditures | (9,530 | ) | (6,855 | ) | (27,164 | ) | (22,507 | ) | ||||||||
Proceeds from disposition of capital assets | 4,770 | 2,832 | 6,339 | 3,738 | ||||||||||||
Payments for acquisitions, net | (1,666 | ) | — | (8,823 | ) | (49,957 | ) | |||||||||
Proceeds from divestitures | — | 15,320 | — | 15,320 | ||||||||||||
Total (used for) provided from investing activities | (6,426 | ) | 11,297 | (29,648 | ) | (53,406 | ) | |||||||||
Financing Activities: | ||||||||||||||||
Dividends paid | (7,533 | ) | (5,918 | ) | (26,962 | ) | (23,686 | ) | ||||||||
Settlement of treasury shares acquired on the open market | — | — | — | (42,748 | ) | |||||||||||
Stock options exercised - net of shares reacquired | 7,990 | 4,873 | 18,624 | 14,509 | ||||||||||||
Repayment of debt, net | (1,427 | ) | (40,879 | ) | (4,843 | ) | (99,868 | ) | ||||||||
Total used for financing activities | (970 | ) | (41,924 | ) | (13,181 | ) | (151,793 | ) | ||||||||
Effect of exchange rate on cash and cash equivalents | (3,191 | ) | 2,566 | (9,051 | ) | 2,444 | ||||||||||
Increase (decrease) in cash and cash equivalents | 66,788 | 18,528 | 129,665 | (91,791 | ) | |||||||||||
Cash and cash equivalents at beginning of period | 113,604 | 32,199 | 50,727 | 142,518 | ||||||||||||
Cash and cash equivalents at end of period | $ | 180,392 | $ | 50,727 | $ | 180,392 | $ | 50,727 | ||||||||
CRANE CO.
Order Backlog
(in thousands)
December 31, 2005 | September 30, 2005 | June 30, 2005 | March 31, 2005 | December 31, 2004 | |||||||||||
Aerospace & Electronics | $ | 365,010 | $ | 366,109 | $ | 370,913 | $ | 367,472 | $ | 341,505 | |||||
Engineered Materials | 17,241 | 20,673 | 15,964 | 19,414 | 16,376 | ||||||||||
Merchandising Systems | 9,183 | 8,362 | 9,298 | 9,469 | 11,998 | ||||||||||
Fluid Handling | 188,832 | 194,436 | 201,768 | 200,578 | 183,158 | ||||||||||
Controls | 16,864 | 15,182 | 14,952 | 15,625 | 13,696 | ||||||||||
Total Backlog | $ | 597,130 | $ | 604,762 | $ | 612,895 | $ | 612,558 | $ | 566,733 | |||||
CRANE CO.
Non-GAAP Financial Measures
(in thousands)
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||||||
2005 | 2004 | 2006 Estimate | 2005 | 2004 | ||||||||||||||||
INCOME ITEMS: | ||||||||||||||||||||
Operating Profit (Loss) | $ | 55,115 | $ | 60,260 | $ | 213,622 | $ | (161,490 | ) | |||||||||||
Asbestos and Environmental (Income) Charges - Pre-Tax | (14,019 | ) | 347,794 | |||||||||||||||||
Operating Profit before Asbestos and Environmental | $ | 55,115 | $ | 46,241 | $ | 213,622 | $ | 186,304 | ||||||||||||
Operating Profit Margin % | ||||||||||||||||||||
Operating Profit (Loss) | 10.9 | % | 12.4 | % | 10.4 | % | (8.5 | )% | ||||||||||||
Asbestos and Environmental (Income) Charges - Pre-Tax | (2.9 | ) | 18.4 | |||||||||||||||||
Operating Profit before Asbestos and Environmental | 10.9 | % | 9.5 | % | 10.4 | % | 9.9 | % | ||||||||||||
Net Income (Loss) | $ | 35,323 | $ | 46,370 | $ | 136,037 | $ | (105,421 | ) | |||||||||||
Asbestos and Environmental (Income) Charges - Net of Tax | (9,112 | ) | 229,272 | |||||||||||||||||
Gain on Victaulic Divestiture - Net of Tax | (6,533 | ) | (6,533 | ) | ||||||||||||||||
Net Income before Asbestos, Environmental and Gain on Victaulic | $ | 35,323 | $ | 30,725 | $ | 136,037 | $ | 117,318 | ||||||||||||
Per Diluted Share: | ||||||||||||||||||||
Net Income (Loss) | $ | 0.58 | $ | 0.78 | $ | 2.25 | $ | (1.78 | ) | |||||||||||
Asbestos and Environmental (Income) Charges - Net of Tax | (0.15 | ) | 3.87 | |||||||||||||||||
Gain on Victaulic Divestiture - Net of Tax | (0.11 | ) | (0.11 | ) | ||||||||||||||||
Net Income before Asbestos, Environmental and Gain on Victaulic | $ | 0.58 | $ | 0.52 | $ | 2.25 | $ | 1.98 | ||||||||||||
CASH FLOW ITEMS: | ||||||||||||||||||||
Cash Provided from Operating Activities before Asbestos - Related Payments | $ | 98,157 | $ | 66,309 | $ | 240,000 | $ | 216,958 | $ | 149,020 | ||||||||||
Net Asbestos Payments | (20,782 | ) | (9,720 | ) | (45,000 | ) | (45,338 | ) (a) | (28,056 | ) (a) | ||||||||||
(Payment) Refund Associated with Terminated Master Settlement Agreement | (10,000 | ) | 9,925 | (10,000 | ) | |||||||||||||||
Cash Provided from Operating Activities | 77,375 | 46,589 | 195,000 | 181,545 | 110,964 | |||||||||||||||
Less: Capital Expenditures | (9,530 | ) | (6,855 | ) | (30,000 | ) | (27,164 | ) | (22,507 | ) | ||||||||||
Free Cash Flow | $ | 67,845 | $ | 39,734 | $ | 165,000 | $ | 154,381 | $ | 88,457 | ||||||||||
(a) | Includes certain legal fees and expenses relating to the terminated Master Settlement Agreement amounting to $5.1 million in 2005 and $7.9 million in 2004. |
Certain non-GAAP measures have been provided to facilitate comparison with the prior year.
Free cash flow provides supplemental information to assist management and certain investors in analyzing the Company’s ability to generate positive cash flow.
Free cash flow is considered a measure of cash generation and should be considered in addition to, but not as a substitute for, other measures reported in accordance with generally accepted accounting principles and may be inconsistent with similar measures presented by other companies.