UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
| Filed by Registrant x | Filed by a Party other than the Registrant ¨ |
Check the appropriate box:
| ¨ | Preliminary Proxy Statement |
| ¨ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
| ¨ | Definitive Proxy Statement |
| x | Soliciting Material Pursuant to § 240.14a-12 |
ROBBINS & MYERS, INC.
(Name of registrant as specified in its charter)
(Name of Person(s) Filing Proxy Statement, of other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
| x | No Fee Required |
| ¨ | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
| (1) | Title of each class of securities to which transaction applies: |
| (2) | Aggregate number of securities to which transaction applies: |
| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): |
| (4) | Proposed maximum aggregate value of transaction: |
| (5) | Total fee paid: |
| ¨ | Fee paid previously with preliminary materials. |
| ¨ | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| (1) | Amount Previously Paid: |
| (2) | Form, Schedule or Registration Statement No.: |
| (3) | Filing Party: |
| (4) | Date Filed: |
Investor Relations
+1 (936) 856-9109
ROBBINS & MYERS ANNOUNCES FOURTH QUARTER & FISCAL YEAR
2012 RESULTS AND DIVIDEND
HOUSTON, TEXAS, October 19, 2012…Robbins & Myers, Inc. (NYSE: RBN) today reported diluted net earnings per share from continuing operations (DEPS) of $0.76 for its fiscal fourth quarter ended August 31, 2012, or $0.92 after adjusting for unfavorable costs of $0.16 related to its pending merger with National Oilwell Varco, the estimated settlement of an export investigation matter, settlement of the work stoppage at its Springfield, Ohio, pump manufacturing plant and the impact of the hurricane in the Gulf of Mexico the last week of August. This compares with $0.77 from continuing operations in the prior year fourth quarter, or $0.79, after adjusting for restructuring charges related to the Company’s Process & Flow Control segment. Excluding the impact of these items, DEPS was $0.92 compared with $0.79 in the prior year period, an increase of 16%.
For the full fiscal year, Robbins & Myers reported DEPS of $3.39 compared with $1.94 for fiscal year 2011, fiscal 2011 included $0.44 of restructuring and T-3 acquisition related charges.
Consolidated sales were $275 million in the fourth quarter of 2012 as compared with $259 million in the fourth quarter of 2011. Excluding the impact of currency translation, sales grew $23 million, or 9%, over the prior year period. The Company reported fourth quarter 2012 orders of $267 million, an increase of 5% over the prior year period excluding the impact of currency translation. Fourth quarter ending backlog increased to $308 million from $251 million at the end of the prior fiscal year.
Fourth quarter 2012 earnings before interest and taxes (EBIT) were $47 million, or adjusted EBIT of $56 million, adjusting for $9 million in unfavorable costs related to its pending merger with National Oilwell Varco, the potential settlement of an export investigation matter, settlement of the work stoppage at our Springfield, Ohio, pump manufacturing plant and the impact of the hurricane in the Gulf of Mexico the last week of August.
Fourth Quarter Results by Segment
All comparisons are made against the comparable year-ago quarterly period unless otherwise stated.
The Company’sEnergy Services segment reported orders of $173 million, an increase of $8 million over the prior year period excluding the impact of currency. Sales were $176 million in the fourth quarter of fiscal 2012 and $10 million over the prior year period, excluding currency impacts. EBIT was $45 million, which included the unfavorable impact of the Gulf of Mexico hurricane of $2 million, compared with EBIT of $51 million in the prior year period. Product mix had a negative impact on the current quarter’s EBIT, as the sales of profitable drilling system products were lower compared with the prior year. Ending backlog was $170 million, significantly higher than the $121 million at the end of the prior year.
TheProcess & Flow Control segment reported orders of $94 million, which were $4 million, or 4%, over the prior year period excluding currency impacts. The increase was primarily due to improving demand for capital goods in the chemical markets. Sales of $99 million were $13 million, or 14%, higher than the prior year excluding currency impacts. The
segment reported $12 million of EBIT in the fourth quarter of 2012, including costs related to the settlement of the work stoppage at the Springfield, Ohio, pump manufacturing plant, or 11.9% of sales, as compared with $7 million of adjusted EBIT, or 7.1%, of sales in the prior year period. Backlog rose to $138 million from $130 million at the end of the prior fiscal year.
“We are pleased with performance in both of our business segments,” said Peter C. Wallace, President and Chief Executive Officer of Robbins & Myers, Inc. “The Energy Services segment has been impacted by a reduction in U.S. rig count and lower drilling activity during the quarter, but still demonstrated excellent performance. In the Process & Flow Control segment, we experienced stronger demand in the chemical and industrial markets. We have steadily improved operating performance in this segment by leveraging incremental sales volume and recovering margin with a sharper focus on regional pricing opportunities and cost controls resulting in operating margin of nearly 12% for the quarter, including the effect of the work stoppage settlement.”
Share Repurchase
During the fourth quarter and prior to June 19, 2012 the Company repurchased 0.5 million of its shares for a total of $24 million. For the fiscal year of 2012 the Company repurchased 4.0 million shares for a total of $187 million.
Conference Call
The Company will not be holding a webcast or conference call due to the pending merger with National Oilwell Varco.
Dividend Declared
Robbins & Myers also announced today that its Board of Directors approved its regular quarterly cash dividend payment of $0.05 per share. The dividend is payable on November 20, 2012 to shareholders of record as of October 29, 2012.
About Robbins & Myers
Robbins & Myers, Inc. is a leading supplier of engineered equipment and systems for critical applications in global energy, industrial, chemical and pharmaceutical markets.
In this release the Company refers to EBIT, adjusted EBIT, and adjusted DEPS which are non-GAAP measures. The Company uses these measures to evaluate its performance and believes these measures are helpful to investors in assessing its performance. A reconciliation of these amounts to net income from continuing operations is included herein. EBIT is not a measure of cash available for use by the Company.
Forward-Looking Statements
Statements set forth in this press release that are not historical facts are forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond the control of Robbins & Myers, which could cause actual benefits, results, effects and timing to differ materially from the results predicted or implied by the statements. These risks and uncertainties include, but are not limited to: the failure of our shareholders to approve the merger; satisfaction of the conditions to the closing of the merger (including the receipt of regulatory approvals and completion of certain compliance due diligence); uncertainties as to the timing of the merger; costs and difficulties relating to the proposed merger; inability to retain key personnel; changes in the demand for or price of oil and/or natural gas; and other important risk factors discussed more fully in Robbins & Myers’ preliminary proxy statement filed with the SEC on August 31, 2012 in connection with the merger, its Annual Report on Form 10-K for the year ended August 31, 2011; its recent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K; and other reports filed by it with the SEC from time to time (including the final proxy statement relating to the proposed merger). Robbins & Myers undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
Additional Information and Where to Find It
In connection with the proposed merger, Robbins & Myers filed a preliminary proxy statement with the SEC on August 31, 2012 and may file other relevant materials with the SEC as well. INVESTORS AND SECURITY HOLDERS ARE URGED TO CAREFULLY READ THE PROXY STATEMENT AND ANY OTHER MATERIALS REGARDING THE PROPOSED MERGER (INCLUDING THE FINAL PROXY STATEMENT) WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN AND WILL CONTAIN IMPORTANT INFORMATION ABOUT ROBBINS & MYERS AND THE PROPOSED MERGER. The final proxy statement will be mailed to Robbins & Myers shareholders. Investors and security holders may obtain a free copy of the proxy statement (when it is available) and other documents containing information about Robbins & Myers, without charge, at the SEC’s web site at www.sec.gov. Copies of Robbins & Myers’ SEC filings also may be obtained for free by directing a request to Robbins & Myers, Inc., 10586 Highway 75 North, Willis, Texas 77378, (936) 890-1064.
Participants in the Solicitation
Robbins &Myers, National Oilwell Varco, and certain of their respective directors and executive officers may be deemed, under SEC rules, to be participants in the solicitation of proxies from Robbins & Myers’ shareholders in connection with the proposed merger. Information about Robbins & Myers’ directors and executive officers and the special interests of these persons in connection with the proposed merger can be found in the preliminary proxy statement filed by Robbins & Myers with the SEC on August 31, 2012. Information about National Oilwell Varco’s directors and executive officers can be found in National Oilwell Varco’s Annual Report on Form 10-K for its fiscal year ended December 31, 2011, as filed with the SEC on February 23, 2012, and National Oilwell Varco’s proxy statement relating to its 2012 Annual Meeting of Shareholders, as filed with the SEC on April 5, 2012. These documents can be obtained, without charge, at the SEC’s website at www.sec.gov.
CONTACT: Robbins & Myers, Inc.
Kevin Brown, (936) 856-9109
Kevin.Brown@robn.com
ROBBINS & MYERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
(in thousands) | August 31, 2012 | August 31, 2011 | ||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 166,925 | $ | 230,606 | ||||
Accounts receivable | 180,047 | 166,511 | ||||||
Inventories | 162,713 | 151,463 | ||||||
Other current assets | 11,206 | 11,247 | ||||||
Deferred taxes | 21,169 | 18,674 | ||||||
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Total Current Assets | 542,060 | 578,501 | ||||||
Goodwill & Other Intangible Assets | 773,604 | 798,719 | ||||||
Deferred Taxes | 25,200 | 26,344 | ||||||
Other Assets | 12,663 | 13,776 | ||||||
Property, Plant & Equipment | 169,736 | 165,626 | ||||||
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| $ | 1,523,263 | $ | 1,582,966 | |||||
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LIABILITIES AND EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 95,698 | $ | 84,761 | ||||
Accrued expenses | 99,319 | 91,253 | ||||||
Current portion of long-term debt | 153 | 421 | ||||||
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Total Current Liabilities | 195,170 | 176,435 | ||||||
Long-Term Debt - Less Current Portion | — | 24 | ||||||
Deferred Taxes | 134,758 | 131,697 | ||||||
Other Long-Term Liabilities | 102,056 | 108,391 | ||||||
Total Equity | 1,091,279 | 1,166,419 | ||||||
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| $ | 1,523,263 | $ | 1,582,966 | |||||
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ROBBINS & MYERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED INCOME STATEMENT
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||
(in thousands, except per share data) | August 31, 2012 | August 31, 2011 | August 31, 2012 | August 31, 2011 | ||||||||||||
Sales | $ | 275,197 | $ | 258,998 | $ | 1,034,783 | $ | 820,640 | ||||||||
Cost of sales | 173,424 | 158,687 | 632,058 | 515,574 | ||||||||||||
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Gross profit | 101,773 | 100,311 | 402,725 | 305,066 | ||||||||||||
Selling, general and administrative expenses | 51,788 | 46,892 | 181,150 | 156,571 | ||||||||||||
Other expense | 2,959 | 1,012 | 2,959 | 17,152 | ||||||||||||
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Income before interest and income taxes (EBIT) | 47,026 | 52,407 | 218,616 | 131,343 | ||||||||||||
Interest expense (income), net | 116 | (235 | ) | 102 | (196 | ) | ||||||||||
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Income from continuing operations before income taxes | 46,910 | 52,642 | 218,514 | 131,539 | ||||||||||||
Income tax expense | 14,270 | 17,110 | 67,523 | 50,260 | ||||||||||||
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Net income from continuing operations | 32,640 | 35,532 | 150,991 | 81,279 | ||||||||||||
Income from discontinued operations, net of tax | — | — | — | 53,637 | ||||||||||||
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Net income including noncontrolling interest | 32,640 | 35,532 | 150,991 | 134,916 | ||||||||||||
Less: Net income attributable to noncontrolling interest | 240 | 108 | 991 | 904 | ||||||||||||
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Net income attributable to Robbins & Myers, Inc. | $ | 32,400 | $ | 35,424 | $ | 150,000 | $ | 134,012 | ||||||||
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Net income per share from continuing operations: | ||||||||||||||||
Basic | $ | 0.77 | $ | 0.77 | $ | 3.41 | $ | 1.96 | ||||||||
Diluted | $ | 0.76 | $ | 0.77 | $ | 3.39 | $ | 1.94 | ||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 0.77 | $ | 0.77 | $ | 3.41 | $ | 3.26 | ||||||||
Diluted | $ | 0.76 | $ | 0.77 | $ | 3.39 | $ | 3.24 | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic | 42,195 | 45,852 | 44,015 | 41,063 | ||||||||||||
Diluted | 42,356 | 46,114 | 44,197 | 41,420 | ||||||||||||
ROBBINS & MYERS, INC. AND SUBSIDIARIES
CONDENSED BUSINESS SEGMENT INFORMATION FOR CONTINUING OPERATIONS
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||
(in thousands) | August 31, 2012 | August 31, 2011 | August 31, 2012 | August 31, 2011 | ||||||||||||
Customer Sales | ||||||||||||||||
Energy Services | $ | 175,716 | $ | 166,702 | $ | 665,487 | $ | 477,198 | ||||||||
Process & Flow Control | 99,481 | 92,296 | 369,296 | 343,442 | ||||||||||||
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Total | $ | 275,197 | $ | 258,998 | $ | 1,034,783 | $ | 820,640 | ||||||||
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Income Before Interest and Income Taxes (EBIT) (5) | ||||||||||||||||
Energy Services | $ | 44,807 | $ | 51,218 | $ | 198,025 | $ | 130,968 | (3) | |||||||
Process & Flow Control | 11,843 | 5,542 | (2) | 41,429 | 26,812 | (2) | ||||||||||
Corporate and Eliminations | (9,624 | ) (1) | (4,353 | ) | (20,838 | ) (1) | (26,437 | ) (4) | ||||||||
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Total | $ | 47,026 | $ | 52,407 | $ | 218,616 | $ | 131,343 | ||||||||
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Depreciation and Amortization | ||||||||||||||||
Energy Services | $ | 6,780 | $ | 6,293 | $ | 23,401 | $ | 23,560 | ||||||||
Process & Flow Control | 1,992 | 2,185 | 8,176 | 8,392 | ||||||||||||
Corporate and Eliminations | 83 | 93 | 342 | 336 | ||||||||||||
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Total | $ | 8,855 | $ | 8,571 | $ | 31,919 | $ | 32,288 | ||||||||
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Customer Orders | ||||||||||||||||
Energy Services | $ | 172,765 | $ | 165,740 | $ | 714,367 | $ | 517,755 | ||||||||
Process & Flow Control | 94,176 | 96,258 | 386,617 | 358,495 | ||||||||||||
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Total | $ | 266,941 | $ | 261,998 | $ | 1,100,984 | $ | 876,250 | ||||||||
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Backlog | ||||||||||||||||
Energy Services | $ | 169,723 | $ | 121,254 | $ | 169,723 | $ | 121,254 | ||||||||
Process & Flow Control | 138,067 | 129,810 | 138,067 | 129,810 | ||||||||||||
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Total | $ | 307,790 | $ | 251,064 | $ | 307,790 | $ | 251,064 | ||||||||
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| (1) | Includes NOV merger-related costs of $3.0 million for legal, advisory and professional fees. |
| (2) | Includes restructuring costs of $1.0 million related to employee termination benefits at our German facility. |
| (3) | Includes merger-related costs of $3.0 million associated with employee termination benefits, $7.2 million related to backlog amortization; and $9.5 million of expense due to inventory write-up values recorded in cost of sales. |
| (4) | Includes costs of $5.9 million due to merger-related professional fees and accelerated equity compensation expense. |
| (5) | EBIT is a non-GAAP measure. The Company uses this measure to evaluate its performance and believes this measure is helpful to investors in assessing its performance. A reconciliation of this measure to net income is included in our Condensed Consolidated Income Statement. EBIT is not a measure of cash available for use by the Company. |
ROBBINS & MYERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||
(in thousands) | August 31, 2012 | August 31, 2011 | August 31, 2012 | August 31, 2011 | ||||||||||||
Operating activities: | ||||||||||||||||
Net income including noncontrolling interest | $ | 32,640 | $ | 35,532 | $ | 150,991 | $ | 134,916 | ||||||||
Depreciation and amortization | 8,855 | 8,571 | 31,919 | 33,961 | ||||||||||||
Gain on sale of businesses | — | — | — | (53,357 | ) | |||||||||||
Working capital | 5,711 | 16,896 | (12,052 | ) | (36,546 | ) | ||||||||||
Other changes, net | 5,746 | 14,341 | (10,426 | ) | 22,074 | |||||||||||
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Cash provided by operating activities | 52,952 | 75,340 | 160,432 | 101,048 | ||||||||||||
Investing activities: | ||||||||||||||||
Business acquisition, net of cash acquired | — | — | — | (90,410 | ) | |||||||||||
Proceeds from sale of businesses | — | — | — | 89,247 | ||||||||||||
Capital expenditures, net of nominal disposals | (8,658 | ) | (14,084 | ) | (29,464 | ) | (28,307 | ) | ||||||||
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Cash used by investing activities | (8,658 | ) | (14,084 | ) | (29,464 | ) | (29,470 | ) | ||||||||
Financing activities: | ||||||||||||||||
Payments of debt, net | (48 | ) | (750 | ) | (292 | ) | (3,847 | ) | ||||||||
Share repurchase program | (23,971 | ) | — | (187,249 | ) | — | ||||||||||
Dividends paid | (2,110 | ) | (2,064 | ) | (8,581 | ) | (7,557 | ) | ||||||||
Proceeds from issuance of common stock and other, net | 1,075 | (964 | ) | 7,520 | 21,941 | |||||||||||
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Cash (used) provided by financing activities | (25,054 | ) | (3,778 | ) | (188,602 | ) | 10,537 | |||||||||
Exchange rate impact on cash | 1,008 | 1,062 | (6,047 | ) | (722 | ) | ||||||||||
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Increase (decrease) in cash | 20,248 | 58,540 | (63,681 | ) | 81,393 | |||||||||||
Cash and cash equivalents at beginning of period | 146,677 | 172,066 | 230,606 | 149,213 | ||||||||||||
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Cash and cash equivalents at end of period | $ | 166,925 | $ | 230,606 | $ | 166,925 | $ | 230,606 | ||||||||
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ROBBINS & MYERS, INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME FROM CONTINUING OPERATIONS TO EBIT AND ADJUSTED EBIT
RECONCILIATION OF DILUTED EARNINGS PER SHARE (DEPS) FROM CONTINUING OPERATIONS TO ADJUSTED DEPS FROM CONTINUING OPERATIONS
(Unaudited)
| Three Months Ended | ||||||||||||||||
( $ in thousands, except per share data) | August 31, 2012 | August 31, 2011 | ||||||||||||||
| Per Share | Per Share | |||||||||||||||
CONSOLIDATED: | ||||||||||||||||
Net income from cont. operations attributable to R&M / Diluted EPS from cont. operations | $ | 32,400 | $ | 0.76 | $ | 35,424 | $ | 0.77 | ||||||||
Net income attributable to noncontrolling interest | 240 | 108 | ||||||||||||||
Income tax expense | 14,270 | 17,110 | ||||||||||||||
Interest expense (income), net | 116 | (235 | ) | |||||||||||||
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EBIT | 47,026 | 52,407 | ||||||||||||||
Special items: | ||||||||||||||||
Pending merger-related costs related to NOV | 2,959 | — | ||||||||||||||
Restructuring costs at our German facility (Process & Flow Control segment) | — | 1,012 | ||||||||||||||
Unusual operating items: | ||||||||||||||||
Potential settlement costs for export investigation | 1,800 | — | ||||||||||||||
Settlement costs of work stoppage at manufacturing plant (Process & Flow Control segment) | 2,500 | — | ||||||||||||||
Impact of hurricane in the Gulf of Mexico (Energy Services segment) | 2,000 | — | ||||||||||||||
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| 9,259 | 0.16 | 1,012 | 0.02 | |||||||||||||
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Adjusted EBIT | $ | 56,285 | $ | 0.92 | $ | 53,419 | $ | 0.79 | ||||||||
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PROCESS & FLOW CONTROL SEGMENT: | ||||||||||||||||
EBIT | $ | 11,843 | $ | 5,542 | ||||||||||||
Special item: Restructuring costs at our German facility | — | 1,012 | ||||||||||||||
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Adjusted EBIT | $ | 11,843 | $ | 6,554 | ||||||||||||
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Adjusted EBIT margin | 11.9 | % | 7.1 | % | ||||||||||||
EBIT, adjusted EBIT, adjusted EBIT margin %, and adjusted diluted EPS from continuing operations are non-GAAP financial measures. The Company uses these measures to evaluate its businesses, and allocates resources to its businesses based on EBIT. EBIT is not, however, a measure of performance calculated in accordance with accounting principles generally accepted in the United States and should not be considered as an alternative to net income as a measure of our operating results. EBIT and adjusted EBIT are not a measure of cash available for use by the Company. Adjusted diluted EPS from continuing operations should not be considered as an alternative to reported net income as an indicator of performance.