Exhibit 99.1
PROFORMA SEGMENT RESULTS
BUSINESS SEGMENTS
| | | | | | | | | |
| (Thousands of U.S. dollars) (Unaudited) | | Year 2007 | | | Year 2006 | |
| |
Mobile Industries Segment | | | | | | | | |
| Net sales to external customers | | $ | 2,426,659 | | | $ | 2,412,086 | |
| Adjusted earnings before interest and taxes (EBIT) (1) | | $ | 49,663 | | | $ | 31,405 | |
| Adjusted EBIT Margin (1) | | | 2.0 | % | | | 1.3 | % |
| | | | | | | | | |
Process Industries Segment | | | | | | | | |
| Net sales to external customers | | $ | 1,081,436 | | | $ | 973,748 | |
| Intersegment sales | | | 1,810 | | | | 1,998 | |
| | | | | | | |
| Total net sales | | $ | 1,083,246 | | | $ | 975,746 | |
| Adjusted earnings before interest and taxes (EBIT) (1) | | $ | 137,920 | | | $ | 124,948 | |
| Adjusted EBIT Margin (1) | | | 12.7 | % | | | 12.8 | % |
| | | | | | | | | |
Aerospace & Defense Segment | | | | | | | | |
| Net sales to external customers | | $ | 312,833 | | | $ | 259,695 | |
| Adjusted earnings before interest and taxes (EBIT) (1) | | $ | 27,657 | | | $ | 18,084 | |
| Adjusted EBIT Margin (1) | | | 8.8 | % | | | 7.0 | % |
| | | | | | | | | |
Total Bearing and Power Transmission Group | | | | | | | | |
| Net sales to external customers | | $ | 3,820,928 | | | $ | 3,645,529 | |
| Intersegment sales | | | 1,810 | | | | 1,998 | |
| | | | | | | |
| Total net sales | | $ | 3,822,738 | | | $ | 3,647,527 | |
| Adjusted earnings before interest and taxes (EBIT) (1) | | $ | 215,240 | | | $ | 174,437 | |
| Adjusted EBIT Margin (1) | | | 5.6 | % | | | 4.8 | % |
| | | | | | | | | |
Steel Group | | | | | | | | |
| Net sales to external customers | | $ | 1,415,092 | | | $ | 1,327,836 | |
| Intersegment sales | | | 146,514 | | | | 144,424 | |
| | | | | | | |
| Total net sales | | $ | 1,561,606 | | | $ | 1,472,260 | |
| Adjusted earnings before interest and taxes (EBIT) (1) | | $ | 231,167 | | | $ | 226,772 | |
| Adjusted EBIT Margin (1) | | | 14.8 | % | | | 15.4 | % |
| | | | | | | | | |
| Unallocated corporate expense | | $ | (65,850 | ) | | $ | (66,880 | ) |
| Intersegment eliminations (expense) income (2) | | $ | (473 | ) | | $ | 3,582 | |
| | | | | | | | | |
Consolidated | | | | | | | | |
| Net sales to external customers | | $ | 5,236,020 | | | $ | 4,973,365 | |
| Adjusted earnings before interest and taxes (EBIT) (1) | | $ | 380,084 | | | $ | 337,911 | |
| Adjusted EBIT Margin (1) | | | 7.3 | % | | | 6.8 | % |
| | |
| (1) | | EBIT is defined as operating income plus other income (expense). EBIT Margin is EBIT as a percentage of net sales. EBIT and EBIT margin on a segment basis exclude certain special items set forth above. EBIT and EBIT Margin are important financial measures used in the management of the business, including decisions concerning the allocation of resources and assessment of performance. Management believes that reporting EBIT and EBIT Margin best reflect the performance of the company’s business segments and EBIT disclosures are responsive to investors. |
| |
| (2) | | Intersegment eliminations represent intersegment profit or loss between the Steel Group and the Bearings and Power Transmission Group. |
Reconciliation of GAAP Income from Continuing Operations before Income Taxes
This reconciliation is provided as additional relevant information about the company’s performance. Management believes Consolidated adjusted earnings before interest and taxes (EBIT) and Total Bearing and Power Transmission Group adjusted EBIT are more representative of the company’s performance and therefore useful to investors. Management also believes that it is appropriate to compare GAAP Income from Continuing Operations before Income Taxes to adjusted EBIT in light of special items related to impairment and restructuring and manufacturing rationalization/reorganization costs, Continued Dumping and Subsidy Offset Act (CDSOA) receipts, and gain/loss on the sale of non-strategic assets.
| | | | | | | | | |
| | | Year 2007 | | Year 2006 |
| (Thousands of U.S. dollars) (Unaudited) | | $ | | $ |
| |
| Income from Continuing Operations before Income Taxes | | $ | 282,257 | | | $ | 254,234 | |
| |
| Pre-tax special items: | | | | | | | | |
| Interest expense | | | 42,684 | | | | 49,387 | |
| Interest (income) | | | (7,045 | ) | | | (4,605 | ) |
| Manufacturing rationalization/reorganization expenses — cost of products sold | | | 31,275 | | | | 18,476 | |
| Manufacturing rationalization/reorganization expenses — SG&A | | | 3,246 | | | | 5,917 | |
| Loss on divestiture | | | 528 | | | | 64,271 | |
| Impairment and restructuring | | | 40,378 | | | | 44,881 | |
| Special items — other (income) | | | (13,239 | ) | | | (94,650 | ) |
| |
| | | |
| Consolidated adjusted earnings before interest and taxes (EBIT) | | $ | 380,084 | | | $ | 337,911 | |
| | | |
| |
| Steel adjusted earnings before interest and taxes (EBIT) | | | (231,167 | ) | | | (226,772 | ) |
| Unallocated corporate expense | | $ | 65,850 | | | $ | 66,880 | |
| Intersegment eliminations expense / income | | | 473 | | | | (3,582 | ) |
| |
| | | |
| Total Bearing and Power Transmission Group adjusted earnings before interest and taxes (EBIT) | | $ | 215,240 | | | $ | 174,437 | |
| | | |
