IDEX Reports Record First Quarter Results – EPS of 74 Cents, Up 12%

  IDEX Reports Record First Quarter Results – EPS of 74 Cents, Up 12%

Business Wire

LAKE FOREST, Ill. -- April 22, 2013

IDEX Corporation (NYSE: IEX) today announced its financial results for the
three month period ended March 31, 2013.

Sales in the quarter totaled $494 million, 1 percent higher than the prior
year period and down 1 percent on an organic basis.

First quarter 2013 operating income was $95 million. This resulted in an
operating margin of 19.2 percent, up 90 basis points from the prior year
adjusted operating margin, primarily due to productivity and benefits from our
structural cost actions taken in prior years.

First quarter earnings per share were 74 cents, an increase of 8 cents, or 12
percent, from the adjusted prior year.

Free cash flow was $67 million for the quarter, a 28 percent increase from
prior year first quarter due to higher earnings.

First Quarter Highlights

  *Orders of $515 million decreased 3 percent compared to the prior year (-5
    percent organic and +2 percent acquisition).
  *Sales of $494 million increased 1 percent compared to the prior year (-1
    percent organic and +2 percent acquisition).
  *Operating margin of 19.2 percent was up 90 basis points from the adjusted
    prior year.
  *Net income of $61 million represents an increase of 10 percent compared to
    the prior year adjusted net income of $56 million.
  *EPS of 74 cents was 8 cents, or 12 percent, higher than the prior year
    adjusted EPS of 66 cents.
  *EBITDA of $116 million, which represents an 11 percent increase from the
    prior year, was 23 percent of sales and covered interest expense by 11
    times.
  *Free cash flow of $67 million, which represents a 28 percent increase from
    the prior year, was over 109 percent of net income.
  *The Company completed the repurchase of 673 thousand shares of common
    stock for $34 million in the first quarter of 2013.
  *The Company acquired FTL Seals Technology.
  *The Board of Directors approved a 15 percent increase in the quarterly
    cash dividend in April.

“Excellent operating income growth, margin improvement and cash generation
marked IDEX’s first quarter of 2013. As anticipated, orders proved a tough
year-over-year comparison due to the large dispensing replenishment project in
2012. Orders decreased 3 percent year-over-year, but were up 7 percent
sequentially, and we built over $20 million of backlog during the quarter. I
am pleased with our ability to execute and deliver a 90 basis point
improvement in operating margin and a 12 percent increase in EPS. The expected
benefits from the recently completed restructuring and structural cost actions
are being realized in our financials.

Previously I highlighted our team’s focus on executing a disciplined capital
deployment plan of strategic acquisitions, shareholder dividends and share
repurchases. In March, we successfully completed the acquisition of FTL Seals
Technology (“FTL”). FTL is a leader in specialty seals and bearings, and will
operate alongside Precision Polymer Engineering to expand our capabilities in
proprietary sealing solutions. We are excited to have FTL join the IDEX
portfolio. The IDEX Board of Directors also approved a 15 percent increase to
the quarterly shareholder dividend, now 23 cents. We continued to execute our
share repurchase program throughout the first quarter and expect it to
continue throughout 2013.

On a regional basis, North America is improving, Europe remains soft and Asia
is uneven. Despite this difficult organic growth environment, we are confident
we can continue to generate strong operating margins and cash flows. We
project second quarter 2013 EPS to be in the range of 73 to 75 cents, while
maintaining our full year 2013 EPS guidance of $2.85 to $2.95, based on low-
to mid-single digit organic revenue growth.”

Andrew K. Silvernail
Chairman and Chief Executive Officer


First Quarter 2013 Business Highlights (Operating margin excludes
restructuring charges in 2012)

Fluid & Metering Technologies

  *Sales in the first quarter of $212 million reflected a 1 percent decrease
    compared to the first quarter of 2012 (all organic).
  *Operating margin of 22.7 percent represented a 50 basis point improvement
    compared with the first quarter of 2012 primarily due to productivity and
    cost reduction initiatives.

Health & Science Technologies

  *Sales in the first quarter of $173 million reflected a 1 percent decrease
    compared to the first quarter of 2012 (-7 percent organic, +7 percent
    acquisitions and -1 percent foreign currency translation).
  *Operating margin of 18.7 percent represented a 40 basis point increase
    compared with the first quarter of 2012 primarily due to productivity and
    cost reduction initiatives.

Fire & Safety/Diversified Products

  *Sales in the first quarter of $112 million reflected a 7 percent increase
    compared to the first quarter of 2012 (all organic) driven by the
    completion of the large dispensing replenishment project.
  *Operating margin of 25.3 percent represented a 200 basis point increase
    compared with the first quarter of 2012 primarily due to higher volume and
    improved productivity.

For the first quarter of 2013, Fluid & Metering Technologies contributed 43
percent of sales and 44 percent of operating income; Health & Science
Technologies accounted for 35 percent of sales and 30 percent of operating
income; and Fire & Safety/Diversified Products represented 22 percent of sales
and 26 percent of operating income.

FTL Seals Technology Acquisition

As previously announced, IDEX acquired FTL Seals Technology, Ltd, a leader in
the design and application of high integrity rotary seals, specialty bearings
and other custom products for the oil & gas, mining, power generation and
marine markets. FTL, located in Leeds, England, has annual revenue of
approximately £15 million and will operate with Precision Polymer Engineering
within our Health & Science Technologies segment.

EBITDA and Free Cash Flow

EBITDA means earnings before interest, income taxes, depreciation and
amortization, while free cash flow means cash flow from operating activities
less capital expenditures plus the excess tax benefit from stock-based
compensation. Management uses these non-GAAP financial measures as internal
operating metrics and for enterprise valuation purposes. Management believes
these measures are useful as analytical indicators of leverage capacity and
debt servicing ability, and uses them to measure financial performance as well
as for planning purposes. However, they should not be considered as
alternatives to net income, cash flow from operating activities or any other
items calculated in accordance with U.S. GAAP, or as an indicator of operating
performance. The definitions of EBITDA and free cash flow used here may differ
from those used by other companies.

EBITDA and Free Cash Flow Bridge

                                                                 
                        For the Quarter Ended
                        March 31,                         December 31,
                        2013        2012        Change    2012         Change
Income (Loss) before    $ 85.4      $ 74.0      15   %    $ (135.9 )   n/m
Taxes
Depreciation and          19.8        19.2      3    %      20.4       (3   %)
Amortization
Interest                 10.6      10.7     (1   %)    10.5      1    %
EBITDA                    115.8       103.9     11   %      (105.0 )   n/m
Restructuring Charge      -           4.9       (100 %)     17.9       (100 %)
Impairment Charge        -         -        -          198.5     (100 %)
Adjusted EBITDA         $ 115.8    $ 108.8    6    %    $ 111.4     4    %
                                                                       
Cash Flow from          $ 72.2      $ 58.7      23   %    $ 85.7       (16  %)
Operating Activities
Capital Expenditures      (7.6  )     (8.5  )   (11  %)     (7.7   )   (1   %)
Excess Tax Benefit
from Stock-Based         2.4       2.1      14   %     1.2       100  %
Compensation
Free Cash Flow          $ 67.0     $ 52.3     28   %    $ 79.2      (15  %)

Conference Call to be Broadcast over the Internet

IDEX will broadcast its first quarter earnings conference call over the
Internet on Tuesday, April 23, 2013 at 9:30 a.m. CT. Chairman and Chief
Executive Officer Andy Silvernail and Vice President and Chief Financial
Officer Heath Mitts will discuss the Company’s recent financial performance
and respond to questions from the financial analyst community. IDEX invites
interested investors to listen to the call and view the accompanying slide
presentation, which will be carried live on its website at www.idexcorp.com.
Those who wish to participate should log on several minutes before the
discussion begins. After clicking on the presentation icon, investors should
follow the instructions to ensure their systems are set up to hear the event
and view the presentation slides, or download the correct applications at no
charge. Investors will also be able to hear a replay of the call by dialing
855.859.2056 (or 404.537.3406 for international participants) using the ID #
26072848.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Exchange Act of 1934, as amended. These statements may relate to, among other
things, capital expenditures, cost reductions, cash flow, and operating
improvements and are indicated by words or phrases such as “anticipate,”
“estimate,” “plans,” “expects,” “projects,” “should,” “will,” “management
believes,” “the company believes,” “the company intends,” and similar words or
phrases. These statements are subject to inherent uncertainties and risks that
could cause actual results to differ materially from those anticipated at the
date of this news release. The risks and uncertainties include, but are not
limited to, the following: economic and political consequences resulting from
terrorist attacks and wars; levels of industrial activity and economic
conditions in the U.S. and other countries around the world; pricing pressures
and other competitive factors, and levels of capital spending in certain
industries – all of which could have a material impact on order rates and
IDEX’s results, particularly in light of the low levels of order backlogs it
typically maintains; its ability to make acquisitions and to integrate and
operate acquired businesses on a profitable basis; the relationship of the
U.S. dollar to other currencies and its impact on pricing and cost
competitiveness; political and economic conditions in foreign countries in
which the company operates; interest rates; capacity utilization and the
effect this has on costs; labor markets; market conditions and material costs;
and developments with respect to contingencies, such as litigation and
environmental matters. The forward-looking statements included here are only
made as of the date of this news release, and management undertakes no
obligation to publicly update them to reflect subsequent events or
circumstances. Investors are cautioned not to rely unduly on forward-looking
statements when evaluating the information presented here.

About IDEX

IDEX Corporation is an applied solutions company specializing in fluid and
metering technologies, health and science technologies, and fire, safety and
other diversified products built to its customers’ exacting specifications.
Its products are sold in niche markets to a wide range of industries
throughout the world. IDEX shares are traded on the New York Stock Exchange
and Chicago Stock Exchange under the symbol “IEX”.

For further information on IDEX Corporation and its business units, visit the
                    company’s website at www.idexcorp.com.

                               (Tables follow)

                                                              
IDEX CORPORATION
Condensed Statements of Consolidated Operations
(in thousands except per share amounts)
(unaudited)
                                                                 
                                                 Three Months Ended
                                                 March 31,
                                               2013           2012
                                                                 
Net sales                                        $ 494,448       $ 489,417
Cost of sales                                    282,451      286,528   
Gross profit                                       211,997         202,889
Selling, general and administrative expenses       117,285         113,382
Restructuring expenses                           -            4,938     
Operating income                                   94,712          84,569
Other income - net                                 (1,279    )     (117      )
Interest expense                                 10,557       10,662    
Income before income taxes                         85,434          74,024
Provision for income taxes                       24,134       21,853    
Net income                                      $ 61,300      $ 52,171    
                                                                 
                                                                 
Earnings per Common Share:
                                                                 
Basic earnings per common share ^(a)             $ 0.74          $ 0.63
                                                                 
Diluted earnings per common share ^(a)           $ 0.74          $ 0.62
                                                                 
                                                                 
Share Data:
                                                                 
Basic weighted average common shares               82,197          82,804
outstanding
                                                                 
Diluted weighted average common shares             83,152          83,902
outstanding
                                                                 
                                                                 
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)

                                                 March 31,       December 31,
                                               2013           2012
                                                                 
Assets
Current assets
Cash and cash equivalents                        $ 341,045       $ 318,864
Receivables - net                                  269,873         256,095
Inventories                                        239,575         234,950
Other current assets                             71,425       71,956    
Total current assets                               921,918         881,865
Property, plant and equipment - net                215,091         219,161
Goodwill and intangible assets                     1,665,580       1,663,099
Other noncurrent assets                          20,011       21,265    
Total assets                                    $ 2,822,600   $ 2,785,390 
                                                                 
Liabilities and shareholders' equity
Current liabilities
Trade accounts payable                           $ 122,376       $ 117,341
Accrued expenses                                   154,470         150,176
Short-term borrowings                              6,776           7,335
Dividends payable                                -            16,575    
Total current liabilities                          283,622         291,427
Long-term borrowings                               815,562         779,241
Other noncurrent liabilities                     241,769      249,724   
Total liabilities                                  1,340,953       1,320,392
Shareholders' equity                             1,481,647    1,464,998 
Total liabilities and shareholders' equity      $ 2,822,600   $ 2,785,390 

                                                      
IDEX CORPORATION
Company and Business Group Financial Information
(dollars in thousands)
(unaudited)
                                                                           
                                                                           
                                 Three Months Ended
                                  March 31, ^(b)
                                2013                    2012           
                                                                           
                                                                           
    Fluid & Metering
    Technologies
    Net sales                     $    211,755              $    212,718
    Operating income ^(c)              48,079                    47,185
    Operating margin                  22.7       %              22.2      %
    Depreciation and              $    6,960                $    7,540
    amortization
    Capital expenditures               2,776                     2,529
                                                                           
    Health & Science
    Technologies
    Net sales                     $    172,868              $    173,786
    Operating income ^(c)              32,267                    31,725
    Operating margin                  18.7       %              18.3      %
    Depreciation and              $    10,792               $    9,461
    amortization
    Capital expenditures               2,786                     2,834
                                                                           
    Fire &
    Safety/Diversified
    Products ^(c)
    Net sales                     $    111,513              $    104,050
    Operating income ^(c)              28,232                    24,232
    Operating margin                  25.3       %              23.3      %
    Depreciation and              $    1,708                $    1,779
    amortization
    Capital expenditures               1,480                     1,941
                                                                           
    Company
    Net sales                     $    494,448              $    489,417
    Operating income ^(c)              94,712                    89,507
    Operating margin                  19.2       %              18.3      %
    Depreciation and              $    19,839               $    19,190
    amortization ^(d)
    Capital expenditures               7,625                     8,427
                                                                           
                                                                     
                                                                           
    Calculated by applying the two-class method of allocating earnings to
(a) common stock and participating securities as required by ASC 260, Earnings
    Per Share.
                                                                           
    Three month data includes acquisitions of Matcon (July 2012) and ERC
(b) (April 2012) in the Health & Science Technologies segment from the date of
    acquisition.
                                                                           
    Group operating income excludes unallocated corporate operating expenses
(c) while both Group and Company operating income excludes restructuring
    related charges for 2012.
                                                                           
(d) Depreciation and amortization excludes amortization of debt issuance
    expenses.

Contact:

IDEX Corporation
Investor Contact:
Heath Mitts
Vice President – Chief Financial Officer
(847) 498-7070
 
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