Exhibit 99.1
ESCO TECHNOLOGIES
For more information contact: For media inquiries:
Patricia K. Moore David P. Garino
Director, Investor Relations (314) 982-0551
ESCO Technologies Inc.
(314) 213-7277
ESCO ANNOUNCES FISCAL YEAR 2007 RESULTS
---------------------------------------
ST. LOUIS, November 12, 2007 - ESCO Technologies Inc. (NYSE: ESE) today
announced its results for the fourth quarter and fiscal year ended September 30,
2007.
Within this release, references to "quarters" and "years" relate to the
fiscal quarters and fiscal years ended September 30 for the respective periods
noted.
4th Quarter Summary:
4thQtr 4thQtr
($ in millions) 2007 2006 Delta
---- ---- -----
Net Sales $162.1 121.8 33.1%
Net Earnings $ 16.6 10.6 56.6%
====== ==== ====
EPS $ 0.64 0.40 60.0%
====== ==== ====
Net Sales and EPS do not reflect DCSI's additional $20.5 million of actual
product deliveries (cash collected) and $8.4 million of pretax earnings related
to its electric AMI shipments to PG&E. DCSI is required to defer revenue
recognition for this contract until delivery of its TWACS NG (formerly referred
to as TNG) software version 3.0. Had the software been delivered during the
fourth quarter, Net Sales would have been $20.5 million higher and EPS would
have increased by $0.20 per share for the fiscal 2007 fourth quarter and full
year.
Total Year Summary:
FY FY
($ in millions) 2007 2006 Delta
---- ---- -----
Net Sales $527.5 458.9 14.9%
Net Earnings $ 33.7 31.3 7.7%
====== ==== ===
EPS $ 1.28 1.19 7.6%
====== ==== ===
Sales
- -----
Fourth quarter 2007 sales were $162.1 million, or 33.1 percent higher than
fourth quarter 2006 sales of $121.8 million with all three operating segments
contributing to the sales growth. Fiscal year 2007 sales were $527.5 million, or
14.9 percent higher than the $458.9 million of sales in fiscal year 2006.
Communications sales of $64.4 million increased $19.8 million, or 44.4
percent in the 2007 fourth quarter compared to the fourth quarter of 2006 with
all operating units recording higher sales in the current quarter. Fixed network
RF AMI sales had the largest increase adding $11.0 million, or 142 percent, to
fourth quarter 2007 sales primarily related to gas deliveries to PG&E. Fixed
network PLC AMI sales increased $7.7 million, or 25.4 percent, in the 2007
quarter primarily related to additional deliveries to COOP and public power
(Municipal) customers. Software sales increased 9.1 percent and sales of digital
video security products increased 23.8 percent in the fourth quarter of 2007.
For the full year, 2007 Communications sales increased $41.4 million, or 26.5
percent over 2006 to $197.6 million. RF AMI sales increased 164 percent, with
PLC AMI sales increasing 5.4 percent and software sales increasing 48.3 percent.
PLC AMI sales to COOP's and Municipals were $94.2 million, representing an
increase of 18.4 percent over 2006.
Filtration sales of $53.0 million increased $8.0 million, or 17.8 percent
in the fourth quarter of 2007 compared to 2006, primarily driven by the
continued strength in most end markets including defense spares and space
products, commercial aerospace, and medical and commercial products. Full year
Filtration sales increased $14.3 million, or 8.2 percent in 2007 compared to
2006 also reflecting the continued strength in the above mentioned end markets.
Test segment sales were $44.7 million and increased $12.5 million, or 38.8
percent, during the fourth quarter of 2007 compared to 2006 as a result of the
ongoing strength of the wireless and electronics end markets, along with the
completion of chamber installations and component deliveries from earlier in the
year. Fiscal 2007 sales of $141.5 million increased $12.9 million, or 10.0
percent, over the $128.6 million in sales during fiscal 2006 driven by continued
growth in large chambers and a 26.2 percent increase in Asian sales.
Earnings Before Interest and Taxes (EBIT)
- -----------------------------------------
On a segment basis, items that impacted EBIT dollars and EBIT as a percent
of sales ("EBIT margin") during the fourth quarter of fiscal 2007 included the
following.
In the Communications segment, EBIT for the 2007 fourth quarter was $10.1
million (15.7 percent of sales), compared to $8.2 million (18.4 percent of
sales) in the 2006 fourth quarter. The $1.9 million increase in EBIT dollars in
2007 is due to the higher sales volume across the segment as noted above, and
the decrease in EBIT margin is driven by additional TWACS NG software
amortization, engineering / new product development costs, and PG&E program
support costs. Fiscal year 2007 EBIT of $22.0 million decreased $6.3 million
compared to 2006 primarily due to additional TWACS NG amortization in 2007 ($6.2
million compared to $2.2 million in 2006) and higher SG&A primarily related to
new product development costs and additional business development headcount.
In the Filtration segment, the 2007 fourth quarter EBIT was $8.3 million
(15.7 percent of sales) compared to $5.5 million (12.2 percent of sales) in the
prior year fourth quarter. The increase in both EBIT dollars and margin is due
to the significant sales increase noted above and more favorable overhead
absorption on the increased sales volume. Fiscal year 2007 Filtration EBIT of
$23.4 million (12.4 percent of sales) increased $3.9 million over fiscal 2006
EBIT of $19.5 million (11.2 percent of sales) due to higher incremental margins
achieved on the increased sales volume.
In the Test segment, 2007 fourth quarter EBIT was $6.2 million (13.9
percent of sales) which increased $2.5 million compared to the 2006 fourth
quarter EBIT of $3.7 million (11.5 percent of sales) and is driven by the nearly
39 percent increase in sales during the 2007 fourth quarter. For the year, 2007
EBIT was $14.4 million (10.2 percent of sales) compared to full year 2006 EBIT
of $15.0 million (11.7 percent of sales). As noted in an earlier release, the
2007 fiscal third quarter and full year Test segment EBIT was unfavorably
impacted by $2.6 million of costs associated with an arbitration judgment
related to a 2005 U.S. Government project discussed in the Company's May 22,
2007 release. Without the legacy arbitration costs, 2007 EBIT would have been
$17.0 million, or 12.0 percent of sales compared to 11.7 percent in 2006.
Corporate operating costs included in EBIT were $4.0 million in the fourth
quarter of 2007 compared to $4.5 million in the 2006 fourth quarter. Total 2007
Corporate costs were $2.6 million higher than 2006 due, in part, to the absence
of the $1.8 million gain in 2006 from a previously divested defense subsidiary,
higher stock option expenses and professional fees.
Effective Tax Rate
- ------------------
The effective tax rate in the fourth quarter of 2007 was 19.5 percent
compared to 19.8 percent in the fourth quarter of 2006. Fiscal year tax rates
were 21.1 percent and 36.0 percent in 2007 and 2006, respectively. The 2007 rate
was favorably impacted by research credits recognized throughout the year, and
the 2006 rate was unfavorably impacted by the repatriation of certain foreign
cash balances.
New Orders
- ----------
New orders received in the 2007 fourth quarter were $133.7 million compared
to $115.2 million received in the 2006 fourth quarter. During fiscal 2007, total
orders received were $562.2 million (book-to-bill of 107 percent) compared to
$479.2 million (book-to-bill of 104 percent) received in fiscal 2006, which
reflects two consecutive years of positive order trends.
Backlog at September 30, 2007 was $288.1 million, which increased $34.7
million, or 13.7 percent during fiscal year 2007 from the beginning backlog of
$253.4 million.
New orders received in the fourth quarter of 2007 compared to the fourth
quarter of 2006, respectively, were: in Filtration, $60.4 million and $38.2
million; in Communications, $33.9 million and $43.1 million; and in Test, $39.3
million and $33.9 million.
Cash
- ----
At September 30, 2007, the Company had $18.6 million in cash compared to
$36.8 million in cash at September 30, 2006. The $18.2 million net decrease in
cash during 2007 reflects cash generation of $49.6 million, offset by: $30.1
million spent on software upgrades (primarily TWACS NG); $19.5 million spent on
capital expenditures; $10 million spent on share repurchases; and $8.2 million
spent on business acquisitions.
Stock Repurchase Program
- ------------------------
Under the terms of the stock repurchase program authorized in August 2006,
the Company spent $10 million in July 2007 to repurchase 265,000 shares in the
open market.
Acquisition - Wintec LLC
- ------------------------
Effective August 10, 2007, the Company acquired the assets and certain
liabilities of Wintec LLC, a California based manufacturer of filtration / fluid
flow control devices for $6 million in cash. The results of Wintec for the two
months since the date of acquisition are included as part of VACCO and are
included in the Filtration segment.
Doble Acquisition - Subsequent Event
- ------------------------------------
As announced in the Company's release dated November 7, 2007, ESCO has
agreed to acquire the stock of Doble Engineering Company, headquartered in
Watertown, Massachusetts, for $319 million in cash, which is being funded by a
combination of existing cash and borrowings under a new $400 million credit
facility led by National City Bank. The transaction is expected to close in the
quarter ending December 31, 2007, and is subject to Hart-Scott-Rodino Act
clearance.
Chairman's Commentary
- ---------------------
Vic Richey, Chairman and Chief Executive Officer, commented, "Our fourth
quarter operating performance was exceptionally strong and generally consistent
with our expectations as we delivered significant increases in sales and EBIT
across all operating segments. In spite of the numerous challenges we faced
throughout 2007, including having to defer the accounting revenue and profit on
the electric portion of the PG&E contract, we delivered on the financial and
operating commitments that we established at the start of the year.
"We accomplished a lot of positive things in 2007. Our new product
introductions, including the advancements we made in our upgraded AMI software,
have begun to gain momentum in the IOU market. The favorable customer reactions
that we have been experiencing following our new product demonstrations at the
recent AMI trade show have been very exciting. In my opinion, our home area
network demonstration (HANfx) was clearly a hit at the October show.
Additionally, we released our TWACS NG software version 2.0 to PG&E in October,
and we are on track to deliver 3.0 during the first fiscal quarter. The rigorous
testing continues to go well and the system is performing most of its advanced
functions.
"While pleased to have 2007 behind us, I am truly excited about the
prospects and growth opportunities across the Company in 2008. Additionally, our
organic growth is expected to be significantly enhanced with the addition of
Doble and its exceptional management team. As discussed during our investor call
on November 7th, the acquisition of Doble is truly a transformational event for
our company as it will significantly increase the sales and profit contributions
within the fastest growing and most profitable segment of our business."
Mr. Richey concluded, "Based on our current outlook described below, fiscal
2008 should be an exciting time for ESCO, both from a customer and shareholder
perspective."
Business Outlook
- ----------------
Statements contained in the preceding and following paragraphs are based on
current expectations. Statements that are not strictly historical are considered
forward-looking, and actual results may differ materially.
The Business Outlook described below does not include the impact of the
acquisition of Doble Engineering which is expected to be completed during the
quarter ending December 31, 2007, or the impact of any potential divestitures,
but does include the remaining amortization of identifiable intangible assets
related to Nexus and Hexagram, as well as the amortization of the TWACS NG
software.
PG&E Contract
- -------------
The 2008 revenue and EPS estimates described below include approximately
$20 million of sales and approximately $8 million of EBIT related to DCSI's
portion of the PG&E contract which is subject to revenue deferral until delivery
and acceptance of TWACS NG version 3.0, currently expected to be delivered in
the quarter ending December 31, 2007.
PG&E's current technology assessment activities will impact the timing and
/ or receipt of future orders from PG&E for its electric deployment, and until
PG&E completes this evaluation and determines whether it will modify its AMI
project plan, the Company cannot reasonably estimate the total value or the
timing of orders that may be received under the current DCSI contract. The gas
portion of the PG&E contract is continuing to be deployed using Hexagram's fixed
network RF solution. Hexagram's RF electric pilot continues being tested as a
potential alternative electric solution for PG&E and has been performing well.
Doble Outlook - 2008
- --------------------
The fiscal 2008 expected operating results of Doble from the projected date
of closing through the remainder of the fiscal year are currently being
evaluated. The fiscal 2008 "EPS" and "Revenue and EBIT Margins" guidance noted
below will be updated upon completion of the transaction and the formalization
of Doble's operating plan for fiscal 2008. The valuation and allocation of
intangible assets related to the purchase of Doble are in process and the
outcome cannot be reasonably estimated at this time.
For comparative purposes, Doble's unaudited revenue and EBITDA was
approximately $80 million and $28 million, respectively, for the trailing 12
months ended September 30, 2007. Doble is expected to be accretive to earnings
per share in fiscal 2008, excluding amortization of intangible assets.
Earnings Per Share - 2008 (Excluding Doble)
- -------------------------------------------
Management expects fiscal year 2008 EPS to be within the following ranges:
EPS - GAAP Basis $ 1.75 to 1.90
Add: Intangible Asset Amortization $ 0.28 0.28
------- ----
EPS - Adjusted Basis $ 2.03 to 2.18
======= ====
The reconciliation noted above includes pretax intangible asset
amortization expense of $11.9 million related to TWACS NG software ($10.6
million) and purchase accounting intangible assets ($1.3 million) related to the
acquisitions of Nexus and Hexagram.
Stock option expense for 2008, which is included in the EPS guidance noted
above, is expected to be in the range of $0.08 to $0.10 per share.
The effective annual tax rate for fiscal 2008 is expected to be
approximately 38 percent.
Revenues and EBIT Margins - 2008 (Excluding Doble)
- --------------------------------------------------
Management expects 2008 consolidated revenues to increase approximately 20
percent compared to 2007, and to be in the range of $630 to $635 million. The
expected consolidated EBIT margins should be in the range of 11 to 11.5 percent
(compared to 8.0 percent in 2007) including the impact of the amortization of
identifiable intangible assets and the TWACS NG amortization. Excluding the
$11.9 million of intangible amortization expense, the consolidated EBIT margins
would be in the range of 13 to 13.5 percent.
On a segment basis, Management expects the following:
o Communication sales are expected to increase 35 to 38 percent and should be
in the range of $268 to $272 million with EBIT margins in the range of 14.8
to 15.2 percent driven by significant sales increases across all product
offerings. Excluding TWACS NG amortization, which is expected to be
approximately $10.6 million, EBIT margins would be approximately 19
percent.
o Filtration sales are expected to increase 11 to 13 percent and should be in
the range of $210 to $213 million with EBIT margins in the range of 12.8 to
13.3 percent.
o Test sales are expected to increase 4 to 6 percent and should be in the
range of $147 to $150 million with EBIT margins in the range of 12.5 to
13.0 percent.
o Corporate operating costs in 2008 are expected to remain relatively flat
from 2007 and should be in the range of $17 to $18 million, and include
approximately $1.3 million of pretax amortization of purchase accounting
intangible assets, and approximately $2.3 million of pretax expense related
to stock options.
Conference Call
The Company will host a conference call today, November 12, at 4:00 p.m.,
Central time, to discuss the Company's fourth quarter and fiscal year operating
results. A live audio webcast will be available on the Company's web site at
www.escotechnologies.com. Please access the web site at least 15 minutes prior
to the call to register, download and install any necessary audio software. A
replay of the conference call will be available for seven days on the Company's
web site noted above or by phone (dial 1-888-203-1112 and enter the pass code
5043227). Forward-Looking Statements
Statements in this press release regarding the amounts and timing of fiscal
2008 future revenues, results, earnings, sales, EBIT, EPS, sales and EBIT
margins on a consolidated basis and on a segment and operating unit basis,
fiscal 2008 corporate operating expenses, the certainty and timing of the Doble
acquisition, potential future revenues from Doble, fiscal 2008 effective tax
rate, long-term success of the Company, successful development, delivery and
customer acceptance of the TWACS NG software, the timing of deferred revenue on
products previously delivered to PG&E, and any other written or oral statements
which are not strictly historical are "forward-looking" statements within the
meaning of the safe harbor provisions of the federal securities laws. Investors
are cautioned that such statements are only predictions and speak only as of the
date of this release, and the Company undertakes no duty to update. The
Company's actual results in the future may differ materially from those
projected in the forward-looking statements due to risks and uncertainties that
exist in the Company's operations and business environment including, but not
limited to: the risk factors described in Item 1A of the Company's Annual Report
on Form 10-K for the fiscal year ended September 30, 2006 and Part II, Item 1A
of the Company's Form 10-Q for the quarter ended June 30, 2007; actions by the
California Public Utility Commission; PG&E's Board of Directors or PG&E's
Management impacting PG&E's AMI projects; the outcome of PG&E's evaluation of
other technologies to meet their requirements for the electric portion of its
service territory; material changes in the Doble business impacting the
acquisition of Doble; receipt regulatory approvals in connection with the Doble
acquisition; the success of the Company's competitors; changes in or the effect
of the Federal Energy Bill; the timing and success of DCSI's software
development efforts; the timing and content of purchase order releases under the
PG&E contracts; DCSI's and Hexagram's successful performance of the PG&E
contracts; site readiness issues with Test segment customers; weakening of
economic conditions in served markets; changes in customer demands or customer
insolvencies; competition; intellectual property rights; technical difficulties;
unforeseen charges impacting corporate operating expenses; the performance of
the Company's international operations; successful execution of the planned sale
of the Company's Puerto Rico facility; material changes in the costs of certain
raw materials including steel, copper and petroleum-based resins; delivery
delays or defaults by customers; termination for convenience of customer
contracts; timing and magnitude of future contract awards; containment of
engineering and development costs; performance issues with key customers,
suppliers and subcontractors; labor disputes; changes in laws and regulations
including but not limited to changes in accounting standards and taxation
requirements; costs relating to environmental matters; uncertainty of disputes
in litigation or arbitration; and the Company's successful execution of internal
operating plans.
ESCO, headquartered in St. Louis, is a proven supplier of special purpose
communications systems for electric, gas and water utilities, including hardware
and software to support advanced metering applications. In addition, the Company
provides engineered filtration products to the transportation, health care and
process markets worldwide and is the industry leader in RF shielding and EMC
test products. Further information regarding ESCO and its subsidiaries is
available on the Company's website at www.escotechnologies.com.
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except per share amounts)
Three Months Ended Three Months Ended
------------------ ------------------
September 30, 2007 September 30, 2006
------------------ ------------------
Net Sales $ 162,133 121,769
Cost and Expenses:
Cost of sales 106,926 78,656
SG&A 31,154 28,308
Amortization of intangible assets 2,805 2,269
Interest (income) expense (19) (274)
Other (income) expenses, net 620 (376)
--- ----
Total costs and expenses 141,486 108,583
------- -------
Earnings before income taxes 20,647 13,186
Income taxes 4,025 2,616
----- -----
Net earnings $ 16,622 10,570
========= ======
Earnings per share:
Basic
Net earnings $ 0.65 0.41
========= ====
Diluted
Net earnings $ 0.64 0.40
========= ====
Average common shares O/S:
Basic 25,760 25,842
====== ======
Diluted 26,160 26,485
====== ======
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except per share amounts)
Year Ended Year Ended
---------- ----------
September 30, 2007 September 30, 2006
------------------ ------------------
Net Sales $ 527,537 458,865
Cost and Expenses:
Cost of sales 349,891 300,309
SG&A 122,502 106,882
Amortization of intangible assets 10,705 6,872
Interest (income) expense (744) (1,286)
Other (income) expenses, net 2,455 (2,814)
----- ------
Total costs and expenses 484,809 409,963
------- -------
Earnings before income taxes 42,728 48,902
Income taxes 9,015 17,622
----- ------
Net earnings 33,713 31,280
====== ======
Earnings per share:
Basic
Net earnings $ 1.30 1.22
========= ====
Diluted
Net earnings $ 1.28 1.19
========= ====
Average common shares O/S:
Basic 25,865 25,718
====== ======
Diluted 26,387 26,386
====== ======
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Business Segment Information
(Unaudited)
(Dollars in millions)
Three Months Ended Year Ended
September 30, September 30,
--------------- --------------
2007 2006 2007 2006
---- ---- ---- ----
Net Sales
- ---------
Communications $ 64.4 44.6 197.6 156.2
PTI 14.3 12.6 52.7 46.4
VACCO 12.7 9.4 37.2 32.3
Filtertek 26.0 23.0 98.5 95.4
---- ---- ---- ----
Filtration subtotal 53.0 45.0 188.4 174.1
Test 44.7 32.2 141.5 128.6
---- ---- ----- -----
Totals $162.1 121.8 527.5 458.9
====== ===== ===== =====
EBIT
- ----
Communications $ 10.1 8.2 22.0 28.3
PTI 3.0 2.3 9.4 6.6
VACCO 2.7 1.4 7.8 6.1
Filtertek 2.6 1.8 6.2 6.8
--- --- --- ---
Filtration subtotal 8.3 5.5 23.4 19.5
Test 6.2 3.7 14.4 (1) 15.0
Corporate (4.0)(2) (4.5)(3) (17.8)(4) (15.2)(5)
---- ---- ----- -----
Totals $ 20.6 12.9 42.0 47.6
====== ==== ==== ====
Note: Depreciation and amortization expense was $5.8 million and
$4.9 million for the quarters ended September 30, 2007 and 2006,
respectively, and $22.2 million and $17.3 million for the
years ended September 30, 2007 and 2006, respectively.
(1) Includes a $2.3 million charge related to the litigation award
within the Test segment and $0.3 million of legal costs associated
with arbitrating this dispute.
(2) Includes $0.4 million of amortization of acquired intangible
assets for Hexagram and Nexus.
(3) Includes $0.8 million of amortization of acquired intangible
assets for Hexagram and Nexus.
(4) Includes $2.1 million of amortization of acquired intangible
assets for Hexagram and Nexus.
(5) Includes a $1.8 million gain related to an indemnification
obligation with respect to a previously divested subsidiary and
$2.7 million of amortization of acquired intangible assets for
Hexagram and Nexus.
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Financial Measures
(Unaudited)
Test Segment EBIT Margin (Dollars in millions):
- -----------------------------------------------
FY07 % of Sales
---- ----------
Test segment EBIT - GAAP $14.4
Arbitration award and related legal costs 2.6
---
Test segment EBIT - Operational $17.0 12.0%
===== ====
EBIT Margin Outlook-FY 2008
- ---------------------------
Consolidated EBIT margin in the range of 11 percent to 11.5 percent,
consolidated EBIT margin excluding the $11.9 million of intangible amortization
expense would be in the range of 13 percent to 13.5 percent, Communications
segment EBIT margin in the range of 14.8 percent to 15.2 percent, Communications
segment EBIT margin of approximately 19 percent (excluding TWACS NG amortization
of approximately $10.6 million), and Filtration segment EBIT margin in the range
of 12.8 percent to 13.3 percent under "Revenues and EBIT Margins-2008 (excluding
Doble)" cannot be reconciled with a GAAP measure as these represent
forward-looking measures with no comparable GAAP measurement quantifiable at
this time.
Doble EBITDA (Dollars in millions): (Trailing 12 Months)
- -----------------------------------
9/30/07
-------
Doble EBIT $23.8
Depreciation & Amortization 3.8
---
Doble EBITDA $27.6
=====
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
(Dollars in thousands)
September 30, September 30,
2007 2006
---- ----
Assets
- ------
Cash and cash equivalents $ 18,638 36,819
Accounts receivable, net 102,994 83,816
Costs and estimated earnings
on long-term contracts 11,520 1,345
Inventories 67,871 50,984
Current portion of deferred
tax assets 25,264 24,251
Other current assets 34,063 10,042
------ ------
Total current assets 260,350 207,257
Property, plant and equipment, net 78,277 68,754
Goodwill 149,466 143,450
Deferred tax assets - -
Other assets 88,014 69,233
------ ------
$576,107 488,694
======== =======
Liabilities and Shareholders' Equity
- ------------------------------------
Short-term borrowings $ 2,844 -
Accounts payable 54,634 39,496
Current portion of deferred revenue 25,239 3,569
Other current liabilities 36,483 32,830
------ ------
Total current liabilities 119,200 75,895
Long-term portion of deferred revenue 6,411 7,458
Other liabilities 35,013 28,907
Long-term debt - -
Shareholders' equity 415,483 376,434
------- -------
$576,107 488,694
======== =======
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
Year Ended
September 30, 2007
------------------
Cash flows from operating activities:
Net earnings $ 33,713
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Depreciation and amortization 22,176
Stock compensation expense 5,299
Changes in operating working capital (37,663)
Effect of deferred taxes 12,873
Change in deferred revenues and costs, net 9,339
Other (474)
----
Net cash provided by operating activities 45,263
Cash flows from investing activities:
Acquisition of businesses (8,250)
Capital expenditures (19,503)
Capitalized software expenditures (30,094)
-------
Net cash used by investing activities (57,847)
-------
Cash flows from financing activities:
Purchases of common stock into treasury (10,007)
Net increase in short-term borrowings 2,844
Other, including exercise of stock options 1,566
-----
Net cash used by financing activities (5,597)
------
Net decrease in cash and cash equivalents (18,181)
Cash and cash equivalents, beginning of period 36,819
------
Cash and cash equivalents, end of period $ 18,638
========
ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Other Selected Financial Data
(Unaudited)
(Dollars in thousands)
Backlog And Entered
- -------------------
Orders-Q4 FY 2007 Comm. Filtration Test Total
- ----------------- ----- ---------- ---- -----
Beginning Backlog
6/30/07 $ 153,659 97,451 65,410 316,520
Entered Orders 33,945 * 60,411 39,325 133,681
Sales (64,428)* (53,008) (44,697) (162,133)
------- ------- ------- --------
Ending Backlog-9/30/07 $ 123,176 104,854 60,038 288,068
========= ======= ====== =======
Backlog And Entered
- -------------------
Orders-YTD FY 2007 Comm. Filtration Test Total
- ------------------ ----- ---------- ---- -----
Beginning Backlog
9/30/06 $ 118,986 78,639 55,787 253,412
Entered Orders 201,821 * 214,629 145,743 562,193
Sales (197,631)* (188,414) (141,492) (527,537)
-------- -------- -------- --------
Ending Backlog-9/30/07 $ 123,176 104,854 60,038 288,068
========= ======= ====== =======
Q4 FY
2007 Q4 FY FY 2007
Entered 2007 Entered FY 2007
*Communications Recap: Orders Sales Orders Sales
- ---------------------- ------ ----- ------ ------
DCSI $ 20,021 38,188 115,500 126,944
Comtrak 3,881 3,877 7,339 7,329
Nexus Energy 3,590 3,596 16,121 14,270
Hexagram 6,453 18,767 62,861 49,088
----- ------ ------ ------
Total $ 33,945 64,428 201,821 197,631
========= ====== ======= =======