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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2004
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 1-10235
IDEX CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 36-3555336
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
630 DUNDEE ROAD, NORTHBROOK, ILLINOIS 60062
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (847) 498-7070
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X] No [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes [X] No [ ]
Number of shares of common stock of IDEX Corporation outstanding as of
July 31, 2004: 50,410,393 (net of treasury shares).
================================================================================
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
IDEX CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
(UNAUDITED)
JUNE 30, DECEMBER 31,
2004 2003
---------- -----------
ASSETS
Current assets
Cash and cash equivalents .......................................... $ 5,989 $ 8,552
Receivables - net .................................................. 124,648 101,859
Inventories ........................................................ 119,701 105,304
Other current assets 11,849 8,781
---------- ----------
Total current assets ............................................. 262,187 224,496
Property, plant and equipment - net .................................... 153,555 147,095
Goodwill - net ......................................................... 692,253 559,008
Intangible assets - net ................................................ 29,237 19,401
Other noncurrent assets ................................................ $ 16,571 $ 10,739
---------- ----------
Total assets ..................................................... $1,153,803 $ 960,739
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable ............................................. $ 77,577 $ 56,252
Dividends payable .................................................. 6,055 4,622
Accrued expenses ................................................... 58,924 54,807
---------- ----------
Total current liabilities ........................................ 142,556 115,681
Long-term debt ......................................................... 286,150 176,546
Other noncurrent liabilities ........................................... 86,453 76,410
---------- ----------
Total liabilities ................................................ 515,159 368,637
---------- ----------
Shareholders' equity
Common stock, par value $.01 per share
Shares issued and outstanding: 2004 - 50,580,868; 2003 - 49,613,328 504 331
Additional paid-in capital ........................................ 219,714 198,165
Retained earnings ................................................. 405,426 375,629
Minimum pension liability adjustment .............................. (12,481) (12,481)
Accumulated translation adjustment ................................ 32,034 35,892
Treasury stock, at cost: 2004 - 175,650; 2003 - 134,228 ........... (4,209) (2,903)
Unearned compensation on restricted stock ......................... (2,344) (2,531)
---------- ----------
Total shareholders' equity ....................................... 638,644 592,102
---------- ----------
Total liabilities and shareholders' equity ....................... $1,153,803 $ 960,739
========== ==========
See Notes to Consolidated Financial Statements.
1
IDEX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
SECOND QUARTER SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
-------------- --------------
2004 2003 2004 2003
--------- --------- --------- ---------
Net sales ........................................ $ 233,590 $ 207,147 $ 448,190 $ 402,645
Cost of sales .................................... 139,667 125,024 268,537 246,219
--------- --------- --------- ---------
Gross profit ..................................... 93,923 82,123 179,653 156,426
Selling, general and administrative expenses ..... 54,109 52,566 108,553 103,468
--------- --------- --------- ---------
Operating income ................................. 39,814 29,557 71,100 52,958
Other (expense) income - net ..................... (235) 341 (224) 361
--------- --------- --------- ---------
Income before interest expense and income taxes .. 39,579 29,898 70,876 53,319
Interest expense ................................. 3,619 3,630 7,055 7,369
--------- --------- --------- ---------
Income before income taxes ....................... 35,960 26,268 63,821 45,950
Provision for income taxes ....................... 13,126 9,325 23,295 16,312
--------- --------- --------- ---------
Net income ....................................... $ 22,834 $ 16,943 $ 40,526 $ 29,638
========= ========= ========= =========
Basic earnings per common share .................. $ .46 $ .35 $ .81 $ .61
========= ========= ========= =========
Diluted earnings per common share ................ $ .44 $ .34 $ .79 $ .60
========= ========= ========= =========
Share data:
Basic weighted average common shares
outstanding ..................................... 50,060 48,576 49,768 48,505
Diluted weighted average common shares
outstanding ..................................... 52,037 49,697 51,578 49,419
See Notes to Consolidated Financial Statements.
2
IDEX CORPORATION AND SUBSIDIARIES
CONSOLIDATED SHAREHOLDERS' EQUITY
(IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
(UNAUDITED)
COMMON UNEARNED
STOCK & MINIMUM COMPENSATION
ADDITIONAL PENSION ACCUMULATED ON TOTAL
PAID-IN RETAINED LIABILITY TRANSLATION TREASURY RESTRICTED SHAREHOLDERS'
CAPITAL EARNINGS ADJUSTMENT ADJUSTMENT STOCK STOCK EQUITY
------- -------- ---------- ---------- ----- ----- ------
Balance, December 31, 2003............. $ 198,496 $375,629 $ (12,481) $ 35,892 $ (2,903) $ (2,531) $ 592,102
--------- -------- ---------- ---------- --------- --------- ----------
Net income............................. 40,526 40,526
Other comprehensive income
Unrealized translation adjustment..... (3,858) (3,858)
---------- ----------
Other comprehensive income....... (3,858) (3,858)
-------- ---------- ----------
Comprehensive income............. 40,526 (3,858) 36,668
-------- ---------- ----------
Issuance of 937,607 shares of
common stock from exercise of
stock options and deferred
compensation plans.................... 20,883 20,883
Issuance of restricted stock........... 839 (839) -
Amortization of restricted stock....... 1,026 1,026
Restricted shares surrendered for
tax withholdings...................... (1,306) (1,306)
Cash dividends declared - $.21 per
common share outstanding............. (10,729) (10,729)
--------- -------- ---------- ---------- --------- --------- ----------
Balance, June 30, 2004................. $ 220,218 $405,426 $ (12,481) $ 32,034 $ (4,209) $ (2,344) $ 638,644
========= ======== ========== ========== ========= ========= ==========
See Notes to Consolidated Financial Statements.
3
IDEX CORPORATION AND SUBSIDIARIES
CONSOLIDATED CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
SIX MONTHS
ENDED JUNE 30,
--------------
2004 2003
--------- ---------
Cash flows from operating activities
Net income .................................................... $ 40,526 $ 29,638
Adjustments to reconcile to net cash from operating activities:
Depreciation and amortization ............................. 14,068 14,099
Amortization of intangibles ............................... 291 319
Amortization of unearned compensation ..................... 1,026 949
Amortization of debt issuance expenses .................... 290 290
Deferred income taxes ..................................... 2,957 3,622
Changes in:
Receivables - net ...................................... (17,193) (12,781)
Inventories ............................................ (4,941) (1,270)
Trade accounts payable ................................. 15,984 6,431
Accrued expenses ....................................... 1,922 3,507
Other - net ............................................... (2,765) 2,248
--------- ---------
Net cash flows from operating activities ................. 52,165 47,052
Cash flows from investing activities
Additions to property, plant and equipment ................ (9,759) (8,407)
Acquisition of businesses, net of cash acquired ........... (161,470) (18,376)
Other - net ............................................... 392 3,194
--------- ---------
Net cash flows from investing activities ................ (170,837) (23,589)
Cash flows from financing activities
Borrowings under credit facilities for acquisitions ....... 161,470 18,376
Net repayments under credit facilities .................... (51,736) (32,624)
Borrowings of other long-term debt ........................ (409) (4,784)
Dividends paid ............................................ (9,297) (9,102)
Proceeds from stock option exercises ...................... 17,284 4,569
Other - net ............................................... (1,203) (994)
--------- ---------
Net cash flows from financing activities ................ 116,109 (24,559)
--------- ---------
Net decrease in cash .......................................... (2,563) (1,096)
Cash and cash equivalents at beginning of year ................ 8,552 6,952
--------- ---------
Cash and cash equivalents at end of period .................... $ 5,989 $ 5,856
========= =========
SUPPLEMENTAL CASH FLOW INFORMATION Cash paid for:
Interest ................................................. $ 6,662 $ 7,116
Income taxes ............................................. 16,380 7,688
See Notes to Consolidated Financial Statements.
4
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
1. BUSINESS SEGMENTS
Information on IDEX's business segments is presented below, based on the
nature of products and services offered. IDEX evaluates performance based on
several factors, of which operating income is the primary financial measure.
Intersegment sales are accounted for at fair value as if the sales were to third
parties.
SECOND QUARTER SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
-------------- --------------
2004 2003 2004 2003
--------- --------- --------- ---------
Net sales
Pump Products:
External customers ...... $ 133,253 $ 112,508 $ 253,791 $ 222,720
Intersegment sales ...... 718 629 1,390 1,421
--------- --------- --------- ---------
Total group sales ..... 133,971 113,137 255,181 224,141
--------- --------- --------- ---------
Dispensing Equipment:
External customers ...... 45,898 47,483 87,517 86,765
Intersegment sales ...... 1 1 1 1
--------- --------- --------- ---------
Total group sales ..... 45,899 47,484 87,518 86,766
--------- --------- --------- ---------
Other Engineered Products:
External customers ...... 54,439 47,156 106,882 93,160
Intersegment sales ...... 1 2 2 2
--------- --------- --------- ---------
Total group sales ..... 54,440 47,158 106,884 93,162
--------- --------- --------- ---------
Intersegment elimination .. (720) (632) (1,393) (1,424)
--------- --------- --------- ---------
Total net sales ....... $ 233,590 $ 207,147 $ 448,190 $ 402,645
========= ========= ========= =========
Operating income
Pump Products ............. $ 23,150 $ 16,112 $ 41,950 $ 31,787
Dispensing Equipment ...... 11,346 9,857 19,242 14,709
Other Engineered
Products .................. 10,882 8,771 21,551 15,921
Corporate office and other (5,564) (5,183) (11,643) (9,459)
--------- --------- --------- ---------
Total operating income $ 39,814 $ 29,557 $ 71,100 $ 52,958
========= ========= ========= =========
2. ACQUISITIONS
On January 6, 2004, the company acquired Manfred Vetter GmbH, based in
Zulpich, Germany. Vetter, with annual sales of approximately $15 million,
designs and manufactures pneumatic lifting and sealing bags for vehicle and air
rescue, environmental protection, industrial maintenance, and disaster recovery
and control. Vetter operates as part of our Hale business unit within the Other
Engineered Products Group. IDEX acquired Vetter for an aggregate purchase price
of $40.6 million, with financing provided by borrowings under the company's
credit facilities. This acquisition also contained a purchase price contingency,
which was settled for $4.2 million in July 2004.
On April 28, 2004, the company acquired Systec, Inc., based in New
Brighton, Minnesota. Systec, with annual sales of approximately $9 million,
designs and manufactures vacuum degassing products for the analytical chemistry
instrumentation market. Degassing of fluids is critical to the instrumentation
and analytical chemistry markets since dissolved gasses within a given fluid can
be detrimental to the accuracy of test results. Systec will operate as part of
our Rheodyne business unit within IDEX's Pump Products Group. IDEX acquired
Systec for an aggregate purchase price of $22.3 million, with financing provided
by borrowings under the company's credit facilities.
5
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
On May 24, 2004, the company completed its acquisition of Scivex, Inc., a
leading provider of fluidic components and systems for the analytical,
biotechnology and diagnostic instrumentation markets. Scivex operates Upchurch
Scientific in Oak Harbor, Washington, Sapphire Engineering in Pocasset,
Massachusetts, and J.L. White in Santa Clara, California, and has annual sales
of approximately $31 million. Scivex will be operated as a stand-alone business
in IDEX's Pump Products Group. IDEX acquired Scivex for an aggregate purchase
price of $98.6 million, with financing provided by borrowings under the
company's credit facilities.
On July 19, 2004, the company acquired Tianjin Dinglee Machine and Motor
Co., Ltd., based in Tianjin, China, outside of Beijing. Dinglee, which will
operate as part of our Hale business unit within the Other Engineered Products
Group, is a leading manufacturer of rescue tools in the Chinese rescue tool
market.
The company does not consider any of the acquisitions, individually or in
aggregate, to be material to its results of operations, financial position, or
cash flows for any of the periods noted.
3. EARNINGS PER COMMON SHARE
Earnings per common share (EPS) are computed by dividing net income by the
weighted average number of shares of common stock (basic) plus common stock
equivalents outstanding (diluted) during the period. Common stock equivalents
consist of stock options, which have been included in the calculation of
weighted average shares outstanding using the treasury stock method, unvested
restricted shares, and shares issuable in connection with certain deferred
compensation agreements (DCUs). Basic weighted average shares reconciles to
diluted weighted average shares as follows:
SECOND QUARTER SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
-------------- --------------
2004 2003 2004 2003
------ ------ ------ ------
Basic weighted average common shares outstanding ............ 50,060 48,576 49,768 48,505
Dilutive effect of stock options, unvested restricted shares,
and DCUs .................................................... 1,977 1,121 1,810 914
------ ------ ------ ------
Diluted weighted average common shares outstanding .......... 52,037 49,697 51,578 49,419
====== ====== ====== ======
4. INVENTORIES
The components of inventories as of June 30, 2004 and December 31, 2003
were:
JUNE 30, DECEMBER 31,
2004 2003
--------- ---------
Raw materials................................ $ 48,333 $ 38,998
Work-in-process.............................. 19,343 13,651
Finished goods............................... 52,025 52,655
--------- ---------
Total............................... $ 119,701 $ 105,304
========= =========
Those inventories which were carried on a LIFO basis amounted to $102,458
and $90,812 at June 30, 2004 and December 31, 2003, respectively. The impact on
earnings of using the LIFO method is not material.
5. COMMON AND PREFERRED STOCK
On April 22, 2004, the company's Board of Directors authorized a
three-for-two common stock split effected in the form of a 50% dividend payable
on May 28, 2004, to shareholders of record on May 14, 2004. Par value of common
stock remained at $.01 per share. All prior share and per share amounts have
been restated to reflect the stock split.
The company had five million shares of preferred stock authorized but
unissued at June 30, 2004 and December 31, 2003.
6
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
6. STOCK OPTIONS
The company uses the intrinsic-value method of accounting for stock option
awards as prescribed by Accounting Principles Bulletin No. 25 and, accordingly,
does not recognize compensation expense for its stock option awards in the
Consolidated Statements of Operations. The following table reflects pro-forma
net income and net income per common share had the company elected to adopt the
fair value approach of Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation."
SECOND QUARTER SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
-------------- --------------
2004 2003 2004 2003
---------- ---------- ---------- ----------
Net income
As reported... $ 22,834 $ 16,943 $ 40,526 $ 29,638
========== ========== ========== ==========
Pro forma .... $ 21,473 $ 15,746 $ 37,943 $ 27,249
========== ========== ========== ==========
Basic EPS
As reported... $ .46 $ .35 $ .81 $ .61
========== ========== ========== ==========
Pro forma .... $ .43 $ .32 $ .76 $ .56
========== ========== ========== ==========
Diluted EPS
As reported... $ .44 $ .34 $ .79 $ .60
========== ========== ========== ==========
Pro forma .... $ .41 $ .32 $ .74 $ .55
========== ========== ========== ==========
7. RETIREMENT BENEFITS
The company sponsors several qualified and nonqualified defined benefit
and defined contribution pension plans and other postretirement plans for its
employees. The following tables provide the components of net periodic benefit
cost for its major defined benefit plans and its other postretirement plans.
PENSION BENEFITS
----------------------------------------------
SECOND QUARTER SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
-------------- --------------
2004 2003 2004 2003
------- ------- ------- -------
Service cost ................. $ 871 $ 984 $ 1,968 $ 1,828
Interest cost ................ 984 1,230 2,236 2,284
Expected return on plan assets (973) (902) (2,099) (1,675)
Net amortization ............. 624 841 1,384 1,562
------- ------- ------- -------
Net periodic benefit cost .... $ 1,506 $ 2,153 $ 3,489 $ 3,999
======= ======= ======= =======
OTHER BENEFITS
----------------------------------------------
SECOND QUARTER SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
-------------- --------------
2004 2003 2004 2003
------- ------- ------- -------
Service cost ................. $ 97 $ 96 $ 197 $ 191
Interest cost ................ 268 309 547 617
Net amortization ............. 29 (9) 58 (18)
------- ------- ------- -------
Net periodic benefit cost .... $ 394 $ 396 $ 802 $ 790
======= ======= ======= =======
7
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
The company previously disclosed in its financial statements for the year
ended December 31, 2003, that it expected to contribute approximately $9.0
million to these pension plans and $.7 million to its other postretirement
benefit plans in 2004. As of June 30, 2004, $8.9 million of contributions have
been made to the pension plans and $.2 million has been made to its other
postretirement benefit plans. The company presently anticipates contributing an
additional $.5 million and $.3 million to fund the pension plans and other
postretirement benefit plans, respectively, in 2004 for a total of $9.4 million
and $.5 million.
The provisions of the Medicare Prescription Drug, Improvement and
Modernization Act of 2003 (Act) have not been taken into account in the
determination of IDEX's accumulated postretirement benefit obligation or net
periodic benefit cost. The company does not expect that the effects of the Act
will have a material impact on its results of operations, financial condition or
cash flows.
8. LEGAL PROCEEDINGS
IDEX is a party to various legal proceedings arising in the ordinary course
of business, none of which is expected to have a material adverse effect on its
business, financial condition or results of operations.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
HISTORICAL OVERVIEW AND OUTLOOK
IDEX Corporation sells a broad range of pump products, dispensing
equipment and other engineered products to a diverse customer base in the United
States and other countries around the world. Accordingly, our businesses are
affected by levels of industrial activity and economic conditions in the U.S.
and in other countries where our products are sold and by the relationship of
the U.S. dollar to other currencies. Levels of capacity utilization and capital
spending in certain industries are among the factors that influence the demand
for our products.
We have a history of achieving above-average operating margins. Our
operating margins have exceeded the average operating margin for the companies
that comprise the Value Line Composite Index (VLCI) every year since 1988. We
view the VLCI operating performance statistics as a proxy for an average
industrial company. Our operating margins are influenced by, among other things,
utilization of facilities as sales volumes change and the inclusion of newly
acquired businesses. Newly acquired businesses may have lower operating margins
than the company's operating margins.
For the three and six months ended June 30, 2004, we reported higher
orders, sales, operating income, net income and diluted earnings per share as
compared with the same period of last year. We are encouraged by the company's
financial and operating performance during the first six months of 2004.
Improving economic conditions and global demand enabled our business units to
deliver record levels of sales and earnings for both the quarter and first half
of the year. The quarter reflects our tenth consecutive quarter of
year-over-year gross margin expansion, our eighth consecutive quarter of
year-over-year earnings growth, and our seventh consecutive quarter of
year-over-year growth in base business sales. Organic revenue growth in our pump
and engineered products businesses more than offset the decline we experienced
during the quarter in dispensing equipment sales following that segment's record
second quarter performance in 2003.
The following forward-looking statements are qualified by the cautionary
statement under the Private Securities Litigation Reform Act set forth below.
Business conditions in the first three months of 2004 certainly improved from
the prior year and our performance in subsequent quarters will depend on the
strength of the economic recovery. As a short-cycle business, our performance is
reliant upon the current pace of incoming orders, and we have limited visibility
on future business conditions. We believe IDEX is well positioned for earnings
growth as the economy improves. This is based on our lower cost structure; our
operational excellence initiatives; and our use of strong cash flow to cut debt
and interest expense. We continue to invest in new products, applications and
global markets, while pursuing strategic acquisitions to help drive IDEX's
longer term profitable growth.
8
CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
The "Historical Overview and Outlook" and the "Liquidity and Capital
Resources" sections of this management's discussion and analysis of our
operations contain 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," "we believe," "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 filing. 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 our order rates and results, particularly in
light of the low levels of order backlogs we typically maintain; our 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 we operate; 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 report, and we undertake 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.
RESULTS OF OPERATIONS
For purposes of this discussion and analysis section, reference is made to
the table on the following page and the company's Consolidated Statements of
Operations included in the Financial Statements section. IDEX consists of three
reporting groups: Pump Products, Dispensing Equipment and Other Engineered
Products.
PERFORMANCE IN THE THREE MONTHS ENDED JUNE 30, 2004 COMPARED TO THE SAME PERIOD
OF 2003
For the three months ended June 30, 2004, orders, sales and profits were
higher than the comparable second quarter of last year. New orders for the
latest three months totaled $230.7 million, 13% higher than the same period last
year. Excluding the impact of foreign currency translation and the Sponsler
(June 2003), Classic (September 2003), Vetter (January 2004), Systec (April
2004) and Scivex (May 2004) acquisitions, orders were 5% higher than the second
quarter of 2003.
Sales in the second quarter were $233.6 million, a 13% improvement from
last year's second quarter as base business shipments grew 5%, foreign currency
translation provided a 2% improvement and acquisitions accounted for a 6%
increase. Base business sales grew 10% domestically, but were down 2%
internationally during the quarter. Sales to international customers from base
businesses represented approximately 45% of total sales, compared with 48% in
2003.
For the quarter, the Pump Products Group contributed 57% of sales and 51%
of operating income, the Dispensing Equipment Group accounted for 20% of sales
and 25% of operating income, and the Other Engineered Products Group represented
23% of sales and 24% of operating income.
Pump Products Group sales of $134.0 million for the three months ended
June 30, 2004, were $20.8 million, or 18%, higher than the prior year mainly due
to a 9% increase in base business activity, a 1% favorable impact from foreign
currency translation, and an 8% increase due to the acquisitions of Sponsler,
Classic, Systec and Scivex. In the second quarter of 2004, base business sales
grew 12% domestically and 7% internationally. Base business sales to customers
outside the U.S. were approximately 38% of total group sales in 2004 compared
with 39% in 2003.
Dispensing Equipment Group sales of $45.9 million decreased $1.6 million,
or 3%, in the second quarter of 2004 compared with last year's second quarter.
This decrease was attributed to favorable foreign currency translation of 2%,
offset by a 5% reduction in base business volume related to lower European
demand versus the prior year's record performance. In the second quarter of
2004, base business sales increased 3% domestically but
9
decreased 10% internationally. Base business sales to customers outside the U.S.
were approximately 66% of total group sales in the 2004 quarter, compared with
69% in 2003.
Other Engineered Products Group sales of $54.4 million increased by $7.3
million, or 15%, in the second quarter of 2004 compared with 2003. This increase
reflects a 4% increase in base business volume, favorable foreign currency
translation of 3% and an 8% increase due to the Vetter acquisition. In the
second quarter of 2004, base business sales increased 11% domestically, but
declined 4% internationally. Base business sales to customers outside the U.S.
were approximately 40% of total group sales in the 2004 quarter, compared with
44% in 2003.
IDEX CORPORATION AND SUBSIDIARIES
COMPANY AND BUSINESS GROUP FINANCIAL INFORMATION
(IN THOUSANDS)
(UNAUDITED)
SECOND QUARTER SIX MONTHS
ENDED JUNE 30, (1) ENDED JUNE 30, (1)
------------------ ------------------
2004 2003 2004 2003
-------- -------- -------- --------
Pump Products Group
Net sales ....................... $133,971 $113,137 $255,181 $224,141
Operating income (2) ............ 23,150 16,112 41,950 31,787
Operating margin ................ 17.3% 14.2% 16.4% 14.2%
Depreciation and amortization ... $ 4,318 $ 4,059 $ 8,177 $ 8,491
Capital expenditures ............ 2,868 2,948 6,601 5,287
Dispensing Equipment Group
Net sales ....................... $ 45,899 $ 47,484 $ 87,518 $ 86,766
Operating income (2) ............ 11,346 9,857 19,242 14,709
Operating margin ................ 24.7% 20.8% 22.0% 17.0%
Depreciation and amortization ... $ 1,404 $ 1,495 $ 2,834 $ 3,069
Capital expenditures ............ 765 659 1,416 1,073
Other Engineered Products Group
Net sales ....................... $ 54,440 $ 47,158 $106,884 $ 93,162
Operating income (2) ............ 10,882 8,771 21,551 15,921
Operating margin ................ 20.0% 18.6% 20.2% 17.1%
Depreciation and amortization ... $ 1,671 $ 1,300 $ 3,103 $ 2,600
Capital expenditures ............ 678 927 1,522 1,935
Company
Net sales ....................... $233,590 $207,147 $448,190 $402,645
Operating income ................ 39,814 29,557 71,100 52,958
Operating margin ................ 17.0% 14.3% 15.9% 13.2%
Depreciation and amortization (3) $ 7,757 $ 7,456 $ 15,385 $ 15,367
Capital expenditures ............ 4,411 4,615 9,759 8,407
(1) Includes acquisition of Sponsler Co., Inc. (June 2003), Classic
Engineering, Inc. (September 2003), Systec, Inc. (April 2004) and Scivex,
Inc. (May 2004) in the Pump Products Group and Manfred Vetter GmbH (January
2004) in the Other Engineered Products Group from the dates of acquisition.
(2) Group operating income excludes unallocated corporate operating expenses in
both years.
(3) Excludes amortization of debt issuance expenses.
10
Gross profit of $93.9 million in the second quarter of 2004 increased by
$11.8 million, or 14%, from 2003. Gross profit as a percent of sales was 40.2%
in 2004 and increased from 39.6% in 2003. The improved gross margins primarily
reflected volume leverage and savings realized from the company's Global
Sourcing, Six Sigma, Kaizen and Lean Manufacturing initiatives.
Selling, general and administrative expenses (SG&A) increased to $54.1
million in 2004 from $52.6 million in 2003 primarily due to acquisitions, and as
a percent of sales was 23.2%, down from 25.3% in 2003.
Operating income increased by $10.2 million, or 35%, to $39.8 million in
2004 from $29.6 million in 2003, primarily reflecting the higher gross margins
partially offset by the increased SG&A expenses. Second quarter operating
margins were 17.0% of sales, 2.7 percentage points higher than at this time last
year. The improvement from last year resulted from the .6 percentage point
increase in gross margins and a 2.1 percentage point decrease in SG&A as a
percent of sales. In the Pump Products Group, operating income of $23.2 million
and operating margins of 17.3% in 2004 were up from the $16.1 million and 14.2%
recorded in 2003 principally due to volume leverage and the impact of our
operational excellence initiatives. Operating income for the Dispensing
Equipment Group of $11.3 million and operating margins of 24.7% in 2004 were up
from the $9.9 million and 20.8% in 2003 primarily due to company's operational
excellence initiatives, as well as volume improvement in the domestic units.
Operating income in the Other Engineered Products Group of $10.9 million and
operating margins of 20.0% in 2004 increased from $8.8 million and 18.6%
achieved in 2003 and primarily reflected increased sales volume.
Other expense in the quarter of $.2 million was unfavorable compared with
$.3 million of income in the second quarter of 2003 mainly due to foreign
currency translation.
The provision for income taxes increased to $13.1 million in 2004 from
$9.3 million in 2003. The effective tax rate increased to 36.5% in 2004 from
35.5% in 2003 due to a greater proportion of income in higher tax jurisdictions
and the resolution of certain tax matters.
Net income for the current quarter was $22.8 million, 35% higher than the
$16.9 million earned in the second quarter of 2003. Diluted earnings per share
in the second quarter of 2004 of $.44 increased $.10 compared with the second
quarter of 2003.
PERFORMANCE IN THE SIX MONTHS ENDED JUNE 30, 2004 COMPARED TO THE SAME PERIOD OF
2003
Orders, sales and profits were higher for the first six months of 2004
compared with the same period last year. New orders for the first six months of
2004 totaled $468.6 million, 14% higher than last year. Excluding the impact of
foreign currency translation and acquisitions, orders were 6% higher than the
comparable period of 2003.
Sales in the first half of the year increased 11% to $448.2 million from
$402.6 million a year ago. Base business sales rose 4%, foreign currency
translation added 3%, and acquisitions accounted for a 4% improvement. Base
business sales, which grew 7% domestically, were down 2% internationally during
the first six months of 2004. For the first half of the year, base business
sales to international customers were approximately 44% of total sales, versus
46% in the first half of 2003.
For the first six months of 2004, the Pump Products Group contributed 57%
of sales and 51% of operating income, the Dispensing Equipment Group accounted
for 19% of sales and 23% of operating income, and the Other Engineered Products
Group represented 24% of sales and 26% of operating income.
Pump Products Group sales of $255.2 million increased $31.0 million, or
14%, for the six months ended June 30, 2004 compared with 2003. Base business
sales provided a 7% increase, acquisitions accounted for a 5% sales improvement
and foreign currency translation added 2%. In the first six months of 2004, base
business sales grew 9% domestically and 4% internationally. Base business sales
to customers outside the U.S. were approximately 38% of total group sales in the
2004 period versus 39% in 2003.
Dispensing Equipment Group sales of $87.5 million increased $.8 million,
or 1%, in the first half of the year of 2004 compared with the same period in
2003. This increase was attributed to favorable foreign currency translation of
6%, offset by a 5% decrease in base business volume due to a decline in European
demand. In the first half of 2004, base business sales decreased 3% domestically
and 6% internationally. Base business sales to customers outside the U.S. were
approximately 64% of total group sales in the first six months of 2004, compared
with 65% in 2003.
11
Other Engineered Products Group sales of $106.9 million increased by $13.7
million, or 15%, in the first six months of 2004 compared with 2003. This
reflected a 5% increase in base business volume, a 5% improvement from foreign
currency translation, and a 5% favorable impact from the Vetter acquisition. In
the first half of 2004, base business sales increased 10% domestically and were
flat internationally. Base business sales to customers outside the U.S. were
approximately 41% of total group sales in 2004, compared with 43% in 2003.
Gross profit of $179.7 million in the first six months of 2004 increased
by $23.2 million, or 15%, from 2003. Gross profit as a percent of sales was
40.1% in 2004 and increased from 38.8% in 2003. The improved gross margins
primarily reflected volume leverage and savings realized from our Global
Sourcing, Six Sigma, Kaizen and Lean Manufacturing initiatives.
Operating income increased by $18.1 million, or 34%, to $71.1 million in
the first half of 2004 from $53.0 million in 2003, primarily reflecting the
higher gross margins discussed above, partially offset by increased SG&A
expenses. Operating margins for the first six months of 2004 were 15.9% compared
with 13.2% in the prior year period. The margin increase from last year was
primarily due to volume leverage and the improvement in gross margins discussed
above. In the Pump Products Group, operating income of $42.0 million and
operating margins of 16.4% in 2004 were up from the $31.8 million and 14.2%
recorded in 2003. Operating income for the Dispensing Equipment Group of $19.2
million and operating margins of 22.0% in 2004 were up from the $14.7 million
and 17.0% in 2003. Operating income in the Other Engineered Products Group of
$21.6 million and operating margins of 20.2% in 2004 increased from $15.9
million and 17.1% achieved in 2003.
SG&A increased to $108.6 million in 2004 from $103.5 million in 2003, and
as a percent of sales was 24.2%, down from 25.6% in 2003. The increase in SG&A
expenses reflected the cumulative impact of acquisitions made in 2004 and 2003,
volume-related expenses and the deliberate reinvestment in the businesses to
drive organic growth.
Other expense in the first six months of 2004 of $.2 million was
unfavorable compared with $.4 million of income in 2003 mainly due to foreign
currency translation.
Interest expense decreased to $7.1 million in the first six months of 2004
from $7.4 million in 2003. This reduction was principally attributable to lower
debt levels this year due to debt paydowns from operating cash flow as well as a
lower interest rate environment.
The provision for income taxes increased to $23.3 million in 2004 from
$16.3 million in 2003. The effective tax rate increased to 36.5% in 2004 from
35.5% in 2003 due to a greater proportion of income in higher tax jurisdictions
and the resolution of certain tax matters.
Net income for the first half of 2004 was $40.5 million, 37% higher than
the $29.6 million earned in the same period of 2003. Diluted earnings per share
in the first six months of 2004 of $.79 increased $.19 compared with the same
period last year.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 2004, working capital was $119.6 million and our current ratio
was 1.8 to 1. Cash flows from operating activities increased $5.1 million, or
11%, to $52.2 million in 2004 mainly due to the improved operating results
discussed above.
Cash flow provided from operations was more than adequate to fund capital
expenditures of $9.8 million and $8.4 million in the first half of 2004 and
2003, respectively. Capital expenditures were generally for machinery and
equipment that improved productivity and tooling to support IDEX's Global
Sourcing initiatives, although a portion was for business system technology and
replacement of equipment and facilities. Management believes that IDEX has ample
capacity in its plants and equipment to meet expected needs for future growth in
the intermediate term.
The company acquired Manfred Vetter in January 2004, Systec in April 2004
and Scivex in May 2004 at a cost of $40.6 million, $22.3 million and $98.6
million, respectively. In February 2003, an $8.0 million payment of deferred
consideration was made in respect of the Rheodyne acquisition, which was
consummated in July 2002. All payments for acquisitions, including the pending
payment for the acquisition of Dinglee, were financed under the company's credit
facility.
12
In addition to the $150.0 million of 6.875% Senior Notes due February 15,
2008, the company also has a $300.0 million domestic multi-currency bank
revolving credit facility (Credit Facility), which expires June 8, 2006. At June
30, 2004, the maximum amount available under the Credit Facility was $300.0
million, of which $98.7 million was borrowed, with outstanding letters of credit
totaling $4.0 million. The Credit Facility contains a covenant that limits total
debt outstanding to three times operating cash flow, as defined in the
agreement. Our total debt outstanding was $286.2 million at June 30, 2004, and
based on the covenant, total debt outstanding was limited to $511.5 million.
Interest is payable quarterly on the outstanding balance at the agent bank's
reference rate or at LIBOR plus an applicable margin and a utilization fee if
the total borrowings exceed certain levels. The applicable margin is based on
the credit rating of our Senior Notes, and can range from 25 basis points to 100
basis points. The utilization fee can range from zero to 25 basis points. On
March 27, 2003, Standard & Poor's upgraded its corporate credit and senior
unsecured debt ratings on IDEX to BBB from BBB-. As a result of this change, at
June 30, 2004, the applicable margin was 57.5 basis points and the utilization
fee was zero. We also pay an annual fee of 17.5 basis points on the total Credit
Facility.
In December 2001, we, and certain of our subsidiaries, entered into a
one-year, renewable agreement with a financial institution, under which we
collateralized certain receivables for borrowings (Receivables Facility). This
agreement was renewed in December 2003 for another year. The Receivables
Facility provides for borrowings of up to $25.0 million, depending upon the
level of eligible receivables. At June 30, 2004, $25.0 million was borrowed and
included in long-term debt at an interest rate of approximately 1.7%.
We also have a $30.0 million demand line of credit (Short-Term Facility),
which expires May 20, 2005. Borrowings under the Short-Term Facility are at
LIBOR plus the applicable margin in effect under the Credit Facility. At June
30, 2004, no borrowings were outstanding under this facility.
We believe the company will generate sufficient cash flow from operations
for the next twelve months and in the long term to meet its operating
requirements, interest on all borrowings, required debt repayments, any
authorized share repurchases, planned capital expenditures, and annual dividend
payments to holders of common stock. Since we began operations in January 1988
and through June 30, 2004, we have borrowed approximately $1,067.0 million under
our various credit agreements to complete 27 acquisitions. During the same
period we generated, principally from operations, cash flow of $945.0 million to
reduce indebtedness. In the event that suitable businesses are available for
acquisition upon terms acceptable to the Board of Directors, we may obtain all
or a portion of the financing for the acquisitions through the incurrence of
additional long-term debt.
Our contractual obligations and commercial commitments include rental
payments under operating leases, payments under capital leases, and other
long-term obligations arising in the ordinary course of business. We have no
off-balance sheet arrangements or material long-term purchase obligations. There
are no identifiable events or uncertainties, including the lowering of our
credit rating, that would accelerate payment or maturity of any of these
commitments or obligations.
CRITICAL ACCOUNTING ESTIMATES
We believe that the application of the following accounting policies,
which are important to our financial position and results of operations,
requires significant judgments and estimates on the part of management. For a
summary of all of our accounting policies, including the accounting policies
discussed below, see Note 1 of the Notes to Consolidated Financial Statements in
our 2003 Annual Report on Form 10-K.
Revenue Recognition - We recognize revenue from products sales when title passes
and the risks of ownership have passed to the customer, based on the terms of
the sale. Our customary terms are FOB shipping point. We estimate and record
provisions for sales returns, sales allowances and original warranties in the
period the related products are sold, in each case based on our historical
experience. To the extent actual results differ from these estimated amounts,
results could be adversely affected.
Noncurrent assets - The company evaluates the recoverability of certain
noncurrent assets utilizing various estimation processes. In particular, the
recoverability of June 30, 2004 balances for goodwill and intangible assets of
$692.3 million and $29.2 million, respectively, are subject to estimation
processes, which depend on the accuracy of underlying assumptions, including
future operating results. The company evaluates the recoverability of each of
these assets based on estimated business values and estimated future cash flows
(derived from estimated earnings and cash flow multiples). The recoverability of
these assets depends on the reasonableness of these assumptions and how they
compare with the eventual operating performance of the specific businesses to
which the assets are
13
attributed. To the extent actual business values or cash flows differ from those
estimated amounts, the recoverability of these noncurrent assets could be
affected.
Income taxes - Deferred taxes are recognized for the future tax effects of
temporary differences between financial and income tax reporting using tax rates
in effect for the years in which the differences are expected to reverse.
Federal income taxes are provided on that portion of the income of foreign
subsidiaries that is expected to be remitted to the United States and be
taxable. The management of the company, along with third-party advisors,
periodically estimates the company's probable tax obligations using historical
experience in tax jurisdictions and informed judgments. To the extent actual
results differ from these estimated amounts, results could be adversely
affected.
Contingencies and litigation - We are currently involved in certain legal and
regulatory proceedings and, as required and where it is reasonably possible to
do so, have accrued our estimates of the probable costs for the resolution of
these matters. These estimates have been developed in consultation with outside
counsel and are based upon an analysis of potential results, assuming a
combination of litigation and settlement strategies. It is possible, however,
that future operating results for any particular quarterly or annual period
could be materially affected by changes in our assumptions or the effectiveness
of our strategies related to these proceedings.
Defined benefit retirement plans - The plan obligations and related assets of
defined benefit retirement plans are presented in Note 14 of the Notes to
Consolidated Financial Statements in the 2003 Annual Report on Form 10-K. Plan
assets, which consist primarily of marketable equity and debt instruments, are
valued using market quotations. Plan obligations and the annual pension expense
are determined by consulting actuaries using a number of assumptions. Key
assumptions in measuring the plan obligations include the discount rate at which
the obligation could be effectively settled and the anticipated rate of future
salary increases. Key assumptions in the determination of the annual pension
expense include the discount rate, the rate of salary increases, and the
estimated future return on plan assets. To the extent actual amounts differ from
these assumptions and estimated amounts, results could be adversely affected.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
We are subject to market risk associated with changes in interest rates
and foreign currency exchange rates. Interest rate exposure is limited to the
$286.2 million of total debt outstanding at June 30, 2004. Approximately 46% of
the debt is priced at interest rates that float with the market. A 50 basis
point movement in the interest rate on the floating rate debt would result in an
approximate $.7 million annualized increase or decrease in interest expense and
cash flows. The remaining debt is fixed rate debt. We will, from time to time,
enter into interest rate swaps on our debt when we believe there is a financial
advantage for doing so. A treasury risk management policy, adopted by the Board
of Directors, describes the procedures and controls over derivative financial
and commodity instruments, including interest rate swaps. Under the policy, we
do not use derivative financial or commodity instruments for trading purposes,
and the use of these instruments is subject to strict approvals by senior
officers. Typically, the use of derivative instruments is limited to interest
rate swaps on the company's outstanding long-term debt.
Our foreign currency exchange rate risk is limited principally to the euro
and British pound. We manage our foreign exchange risk principally through
invoicing our customers in the same currency as the source of our products. As a
result, the company's exposure to any movement in foreign currency exchange
rates is immaterial to the Consolidated Statements of Operations.
At December 31, 2003, the company had a foreign currency contract that it
entered into in anticipation of the funding of the January 2004 purchase of
Manfred Vetter.
ITEM 4. CONTROLS AND PROCEDURES.
The company maintains disclosure controls and procedures that are designed
to ensure that information required to be disclosed in the company's Exchange
Act reports is recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms, and that such information is
accumulated and communicated to the company's management, including its Chief
Executive Officer and Chief Financial Officer, as appropriate, to allow timely
decisions regarding required disclosure. In designing and evaluating the
disclosure controls and procedures, management recognized that any controls and
procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving the desired control objectives, and management
is required to apply its judgment in evaluating the cost-benefit relationship of
possible controls and procedures.
14
As required by SEC Rule 13a-15(b), the company carried out an evaluation,
under the supervision and with the participation of the company's management,
including the company's Chief Executive Officer and the company's Chief
Financial Officer, of the effectiveness of the design and operation of the
company's disclosure controls and procedures as of the end of the period covered
by this report. Based on the foregoing, the company's Chief Executive Officer
and Chief Financial Officer concluded that the company's disclosure controls and
procedures were effective at the reasonable assurance level.
There has been no change in the company's internal controls over financial
reporting during the company's most recent fiscal quarter that has materially
affected, or is reasonably likely to materially affect, the company's internal
controls over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
IDEX and nine of its subsidiaries have been named as defendants in a
number of lawsuits claiming various asbestos-related personal injuries,
allegedly as a result of exposure to products manufactured with components that
contained asbestos. Such components were acquired from third party suppliers,
and were not manufactured by any of the subsidiaries. To date, all of the
company's settlements and legal costs, except for costs of coordination,
administration, insurance investigation and a portion of defense costs, have
been covered in full by insurance subject to applicable deductibles. However,
the company cannot predict whether and to what extent insurance will be
available to continue to cover such settlements and legal costs, or how insurers
may respond to claims that are tendered to them.
Claims have been filed in Alabama, California, Connecticut, Georgia,
Illinois, Louisiana, Michigan, Mississippi, Nevada, New Jersey, New York, Ohio,
Pennsylvania, Texas, Utah and Washington. Most of the claims resolved to date
have been dismissed without payment. The balances have been settled for
reasonable amounts. Only one case has been tried, resulting in a verdict for the
company's business unit.
No provision has been made in the financial statements of the company,
other than for insurance deductibles in the ordinary course, and IDEX does not
currently believe the asbestos-related claims will have a material adverse
effect on the company's business or financial position.
IDEX is also party to various other legal proceedings arising in the
ordinary course of business, none of which is expected to have a material
adverse effect on its business, financial condition or results of operations.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS AND ISSUER PURCHASES OF EQUITY
SECURITIES.
Total Number of Maximum Number of
Shares Purchased as Shares that May Yet
Part of Publicly be Purchased Under
Total Number of Average Price Announced Plans the Plans
Period Shares Purchased Paid per Share or Programs (1) or Programs (1)
------ ---------------- -------------- --------------- ---------------
April 1, 2004 to
April 30, 2004 - - - 2,240,250
May 1, 2004 to
May 31, 2004 - - - 2,240,250
June 1, 2004 to
June 30, 2004 - - - 2,240,250
(1) On October 20, 1998, IDEX's Board of Directors authorized the
repurchase of up to 2.25 million shares of its common stock, either at market
prices or on a negotiated basis as market conditions warrant.
15
ITEM 5. OTHER INFORMATION.
There has been no material change to the procedures by which security
holders may recommend nominees to the company's board.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits:
The exhibits listed in the accompanying "Exhibit Index" are
filed as part of this report.
(b) Reports on Form 8-K:
On April 22, 2004, we furnished a report under Item 12 of a
press release reporting our financial results for the first
quarter ended March 31, 2004.
On April 22, 2004, we filed a report under Item 5 of a press
release announcing a 3-for-2 stock split and an increase in
the quarterly dividend.
On April 27, 2004, we filed a report under Item 2 of a press
release announcing that we had entered into a definitive
agreement to acquire Scivex, Inc.
On April 29, 2004, we filed a report under Item 2 of a press
release announcing our acquisition of Systec, Inc.
On May 25, 2004, we filed a report under Item 9 of a press
release announcing the completion of the Scivex acquisition
and the strategic expansion of our life sciences business.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
IDEX CORPORATION
August 4, 2004 /s/ DOMINIC A. ROMEO
--------------------------------------------
Dominic A. Romeo
Vice President and Chief Financial Officer
(duly authorized principal financial officer)
16
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
------ -----------
3.1 Restated Certificate of Incorporation of IDEX Corporation (formerly
HI, Inc.) (incorporated by reference to Exhibit No. 3.1 to the
Registration Statement on Form S-1 of IDEX, et al., Registration No.
33-21205, as filed on April 21, 1988)
3.1(a) Amendment to Restated Certificate of Incorporation of IDEX Corporation
(formerly HI, Inc.), (incorporated by reference to Exhibit No. 3.1(a)
to the Quarterly Report of IDEX on Form 10-Q for the quarter ended
March 31, 1996, Commission File No. 1-10235)
3.2 Amended and Restated By-Laws of IDEX Corporation (incorporated by
reference to Exhibit No. 3.2 to Post-Effective Amendment No. 2 to the
Registration Statement on Form S-1 of IDEX, et al., Registration No.
33-21205, as filed on July 17, 1989)
3.2(a) Amended and Restated Article III, Section 13 of the Amended and
Restated By-Laws of IDEX Corporation (incorporated by reference to
Exhibit No. 3.2(a) to Post-Effective Amendment No. 3 to the
Registration Statement on Form S-1 of IDEX, et al., Registration No.
33-21205, as filed on February 12, 1990)
4.1 Restated Certificate of Incorporation and By-Laws of IDEX Corporation
(filed as Exhibits No. 3.1 through 3.2 (a))
4.2 Indenture, dated as of February 23, 1998, between IDEX Corporation,
and Norwest Bank Minnesota, National Association, as Trustee, relating
to the 6-7/8% Senior Notes of IDEX Corporation due February 15, 2008
(incorporated by reference to Exhibit No. 4.1 to the Current Report of
IDEX on Form 8-K dated February 23, 1998, Commission File No. 1-10235)
4.3 Specimen Senior Note of IDEX Corporation (incorporated by reference to
Exhibit No. 4.1 to the Current Report of IDEX on Form 8-K dated
February 23, 1998, Commission File No. 1-10235)
4.4 Specimen Certificate of Common Stock of IDEX Corporation (incorporated
by reference to Exhibit No. 4.3 to the Registration Statement on Form
S-2 of IDEX, et al., Registration No. 33-42208, as filed on September
16, 1991)
4.5 Credit Agreement, dated as of June 8, 2001, among IDEX Corporation,
Bank of America N.A. as Agent and Issuing Bank, and the Other
Financial Institutions Party Hereto (incorporated by reference to
Exhibit No. 4.5 to the Quarterly Report of IDEX on Form 10-Q for the
quarter ended June 30, 2001, Commission File No. 1-10235)
4.6 Credit Lyonnais Uncommitted Line of Credit, dated as of December 3,
2001 (incorporated by reference to Exhibit 4.6 to the Annual Report of
IDEX on Form 10-K for the year ended December 31, 2001, Commission
File No. 1-10235)
4.6(a) Amendment No. 2 dated as of May 24, 2003 to the Credit Lyonnais
Uncommitted Line of Credit Agreement dated December 3, 2001
(incorporated by reference to Exhibit 4.6 (a) to the Quarterly Report
of IDEX on Form 10-Q for the quarter ended June 30, 2003, Commission
File No. 1-10235)
*4.6(b) Amendment No. 3 dated as of May 21, 2004 to the Credit Lyonnais
Uncommitted Line of Credit Agreement dated December 3, 2001
4.7 Receivables Purchase Agreement dated as of December 20, 2001 among
IDEX Receivables Corporation, as Seller, IDEX Corporation, as
Servicer, Falcon Asset Securitization Corporation, the Several
Financial Institutions from Time to Time Party Hereto, and Bank One,
NA (Main Office Chicago), as Agent (incorporated by reference to
Exhibit 4.7 to the Annual Report of IDEX on Form 10-K for the year
ended December 31, 2001, Commission File No. 1-10235)
4.7(a) Second Amended and Restated Fee Letter dated as of December 17, 2003
of the Receivables Purchase Agreement dated as of December 20, 2001
(incorporated by reference to Exhibit 4.7 (a) to the Annual Report of
IDEX on Form 10-K for the year ended December 31, 2003, Commission
File No. 1-10235)
17
EXHIBIT INDEX (CON'T.)
EXHIBIT
NUMBER DESCRIPTION
------ -----------
*31.1 Certification of Chief Executive Officer Pursuant to Rule 13a-14(a)
or Rule 15d-14(a)
*31.2 Certification of Chief Financial Officer Pursuant to Rule 13a-14(a)
or Rule 15d-14(a)
*32.1 Certification pursuant to Section 1350 of Chapter 63 of Title 18 of
the United States Code
*32.2 Certification pursuant to Section 1350 of Chapter 63 of Title 18 of
the United States Code
--------------------
* Filed herewith
18