Back to GetFilings.com
================================================================================
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 SEPTEMBER 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
October 31, 2004: 50,631,365 (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)
SEPTEMBER 30, DECEMBER 31,
2004 2003
------------- ------------
ASSETS
Current assets
Cash and cash equivalents .............................................. $ 6,360 $ 8,552
Receivables - net ...................................................... 126,781 101,859
Inventories ............................................................ 124,688 105,304
Other current assets ................................................... 7,150 8,781
----------- ---------
Total current assets ................................................. 264,979 224,496
Property, plant and equipment - net ........................................ 151,900 147,095
Goodwill - net ............................................................. 700,038 559,008
Intangible assets - net ................................................... 29,245 19,401
Other noncurrent assets .................................................... 16,227 10,739
----------- ---------
Total assets ......................................................... $ 1,162,389 $ 960,739
=========== =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable ................................................. $ 71,445 $ 56,252
Dividends payable ...................................................... 6,074 4,622
Accrued expenses ....................................................... 71,912 54,807
----------- ---------
Total current liabilities ............................................ 149,431 115,681
Long-term debt ............................................................. 264,252 176,546
Other noncurrent liabilities ............................................... 87,886 76,410
----------- ---------
Total liabilities .................................................... 501,569 368,637
----------- ---------
Shareholders' equity
Common stock, par value $.01 per share
Shares issued and outstanding: 2004 - 50,746,308; 2003 - 49,613,328 ..... 507 496
Additional paid-in capital .............................................. 224,687 198,000
Retained earnings ....................................................... 422,576 375,629
Minimum pension liability adjustment .................................... (12,481) (12,481)
Accumulated translation adjustment ...................................... 35,022 35,892
Treasury stock, at cost: 2004 - 175,650; 2003 - 134,228 ................. (4,209) (2,903)
Unearned compensation on restricted stock ............................... (5,282) (2,531)
----------- ---------
Total shareholders' equity ........................................... 660,820 592,102
----------- ---------
Total liabilities and shareholders' equity ........................... $ 1,162,389 $ 960,739
=========== =========
See Notes to Consolidated Financial Statements.
- 1 -
IDEX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
THIRD QUARTER NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
-------------------- --------------------
2004 2003 2004 2003
--------- -------- --------- --------
Net sales .............................................. $ 237,557 $197,314 $ 685,747 $599,959
Cost of sales .......................................... 142,568 121,136 411,105 367,355
--------- -------- --------- --------
Gross profit ........................................... 94,989 76,178 274,642 232,604
Selling, general and administrative expenses ........... 55,028 47,235 163,581 150,703
--------- -------- --------- --------
Operating income ....................................... 39,961 28,943 111,061 81,901
Other (expense) income - net ........................... (384) 5 (608) 366
--------- -------- --------- --------
Income before interest expense and income taxes ........ 39,577 28,948 110,453 82,267
Interest expense ....................................... 3,856 3,352 10,911 10,721
--------- -------- --------- --------
Income before income taxes ............................. 35,721 25,596 99,542 71,546
Provision for income taxes ............................. 12,502 9,087 35,797 25,399
--------- -------- --------- --------
Net income ............................................. $ 23,219 $ 16,509 $ 63,745 $ 46,147
========= ======== ========= ========
Basic earnings per common share ........................ $ .46 $ .34 $ 1.28 $ .95
========= ======== ========= ========
Diluted earnings per common share ...................... $ .44 $ .33 $ 1.23 $ .93
========= ======== ========= ========
Share data:
Basic weighted average common shares outstanding ....... 50,293 48,992 49,943 48,668
Diluted weighted average common shares outstanding ..... 52,400 50,460 51,837 49,749
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 .................................... 63,745 63,745
Other comprehensive income
Unrealized translation adjustment ............ (870) (870)
------- --------
Other comprehensive income .............. (870) (870)
------- --------
Comprehensive income .................... 63,745 (870) 62,875
--------- ------- --------
Issuance of 988,047 shares of common
stock from exercise of stock
options and deferred compensation
plans ........................................ 22,327 22,327
Issuance of restricted stock .................. 4,371 (4,371) -
Amortization of restricted stock .............. 1,620 1,620
Restricted shares surrendered for
tax withholdings ............................. (1,306) (1,306)
Cash dividends declared - $.33 per
common share outstanding ..................... (16,798) (16,798)
--------- --------- -------- ------- ------- ------- --------
Balance, September 30, 2004 ................... $ 225,194 $ 422,576 $(12,481) $35,022 $(4,209) $(5,282) $660,820
========= ========= ======== ======= ======= ======= ========
See Notes to Consolidated Financial Statements.
- 3 -
IDEX CORPORATION AND SUBSIDIARIES
CONSOLIDATED CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
NINE MONTHS
ENDED SEPTEMBER 30,
-------------------
2004 2003
--------- --------
Cash flows from operating activities
Net income .................................................... $ 63,745 $ 46,147
Adjustments to reconcile to net cash from operating activities:
Depreciation and amortization ............................. 21,252 20,976
Amortization of intangibles ............................... 463 487
Amortization of unearned compensation ..................... 1,620 1,424
Amortization of debt issuance expenses .................... 435 435
Deferred income taxes ..................................... 6,250 5,678
Changes in:
Receivables - net ........................................ (18,217) (3,195)
Inventories .............................................. (9,018) 2,798
Trade accounts payable ................................... 13,591 3,419
Accrued expenses ......................................... 14,085 9,009
Other - net ............................................... (27) 3,102
--------- --------
Net cash flows from operating activities ................. 94,179 90,280
Cash flows from investing activities
Additions to property, plant and equipment ................ (14,805) (13,614)
Acquisition of businesses, net of cash acquired ........... (171,220) (22,163)
Other - net ............................................... 345 3,326
--------- --------
Net cash flows from investing activities ................ (185,680) (32,451)
Cash flows from financing activities
Borrowings under credit facilities for acquisitions ....... 171,220 22,163
Net repayments under credit facilities .................... (81,187) (67,973)
Repayments of other long-term debt ........................ (37) (4,402)
Dividends paid ............................................ (15,345) (13,679)
Proceeds from stock option exercises ...................... 18,439 10,853
Other - net ............................................... (3,781) (3,580)
--------- --------
Net cash flows from financing activities ................ 89,309 (56,618)
--------- --------
Net (decrease) increase in cash ............................... (2,192) 1,211
Cash and cash equivalents at beginning of year ................ 8,552 6,952
--------- --------
Cash and cash equivalents at end of period .................... $ 6,360 $ 8,163
========= ========
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for:
Interest........................................................$ 12,951 $ 12,908
Income taxes.................................................... 19,286 9,409
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.
THIRD QUARTER NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
-------------------- --------------------
2004 2003 2004 2003
-------- --------- -------- ---------
Net sales
Pump Products:
External customers ............ $ 141,526 $ 114,161 $ 395,317 $ 336,881
Intersegment sales ............ 832 745 2,222 2,166
--------- --------- --------- ---------
Total group sales ........... 142,358 114,906 397,539 339,047
--------- --------- --------- ---------
Dispensing Equipment:
External customers ............ 40,028 36,791 127,545 123,556
Intersegment sales ............ - - 1 1
--------- --------- --------- ---------
Total group sales ........... 40,028 36,791 127,546 123,557
--------- --------- --------- ---------
Other Engineered Products:
External customers ............ 56,003 46,362 162,885 139,522
Intersegment sales ............ 2 2 4 4
--------- --------- --------- ---------
Total group sales ........... 56,005 46,364 162,889 139,526
--------- --------- --------- ---------
Intersegment elimination ........ (834) (747) (2,227) (2,171)
--------- --------- --------- ---------
Total net sales ............. $ 237,557 $ 197,314 $ 685,747 $ 599,959
========= ========= ========= =========
Operating income
Pump Products ................... $ 26,284 $ 18,649 $ 68,234 $ 50,436
Dispensing Equipment ............ 7,348 5,878 26,590 20,587
Other Engineered Products ....... 12,501 8,660 34,052 24,581
Corporate office and other ...... (6,172) (4,244) (17,815) (13,703)
--------- --------- --------- ---------
Total operating income ........ $ 39,961 $ 28,943 $ 111,061 $ 81,901
========= ========= ========= =========
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 initial purchase price of
$40.6 million, with financing provided by borrowings under the company's credit
facilities. This acquisition also contained a purchase price adjustment, 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 operates as part of our
Rheodyne business unit within IDEX's Pump Products Group. IDEX acquired Systec
for an aggregate purchase price of $22.4 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, with annual sales
of approximately $31 million, operates Upchurch Scientific in Oak Harbor,
Washington and Sapphire Engineering in Pocasset, Massachusetts. Scivex is being
operated as a stand-alone business in IDEX's Pump Products Group. IDEX acquired
Scivex for an aggregate purchase price of $98.7 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 operates
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. IDEX
acquired Dinglee for an aggregate purchase price of $4.2 million, with financing
provided by borrowings under the company's credit facilities.
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 presented.
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:
THIRD QUARTER NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
------------------- -------------------
2004 2003 2004 2003
------ ------ ------ ------
Basic weighted average common shares outstanding ............ 50,293 48,992 49,943 48,668
Dilutive effect of stock options, unvested restricted shares,
and DCUs ................................................... 2,107 1,468 1,894 1,081
------ ------ ------ ------
Diluted weighted average common shares outstanding .......... 52,400 50,460 51,837 49,749
====== ====== ====== ======
4. INVENTORIES
The components of inventories as of September 30, 2004 and December 31,
2003 were:
SEPTEMBER 30, DECEMBER 31,
2004 2003
------------- ------------
Raw materials................................................ $ 51,516 $ 38,998
Work-in-process.............................................. 14,609 13,651
Finished goods............................................... 58,563 52,655
Total..................................................... ---------- ---------
$ 124,688 $ 105,304
========== =========
Inventories carried on a LIFO basis amounted to $103,955 and $90,812 at
September 30, 2004 and December 31, 2003, respectively. The impact on earnings
of using the LIFO method is not material.
- 6 -
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
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 paid 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 September 30, 2004 and December 31, 2003.
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."
THIRD QUARTER NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
------------------- -------------------
2004 2003 2004 2003
---------- ---------- --------- ---------
Net income
As reported ...................... $ 23,219 $ 16,509 $ 63,745 $ 46,147
========= ========= ========= =========
Pro forma ........................ $ 21,833 $ 15,316 $ 59,776 $ 42,565
========= ========= ========= =========
Basic EPS
As reported ...................... $ .46 $ .34 $ 1.28 $ .95
========= ========= ========= =========
Pro forma ........................ $ .43 $ .31 $ 1.20 $ .87
========= ========= ========= =========
Diluted EPS
As reported ...................... $ .44 $ .33 $ 1.23 $ .93
========= ========= ========= =========
Pro forma ........................ $ .42 $ .30 $ 1.15 $ .86
========= ========= ========= =========
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
----------------------------------------
THIRD QUARTER NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
------------------- -------------------
2004 2003 2004 2003
------- ------- ------- -------
Service cost ...................... $ 1,078 $ 941 $ 3,216 $ 2,769
Interest cost ..................... 1,270 1,175 3,797 3,459
Expected return on plan assets .... (1,379) (862) (4,141) (2,537)
Net amortization .................. 791 803 2,377 2,365
------- ------- ------- -------
Net periodic benefit cost ..... $ 1,760 $ 2,057 $ 5,249 $ 6,056
======= ======= ======= =======
- 7 -
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
OTHER BENEFITS
----------------------------------------
THIRD QUARTER NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
------------------- -------------------
2004 2003 2004 2003
---- ---- ---- ----
Service cost ................ $ 107 $ 88 $ 304 $ 279
Interest cost ............... 250 284 797 901
Net amortization ............ (9) (8) 49 (26)
----- ----- ------ -------
Net periodic benefit cost... $ 348 $ 364 $1,150 $ 1,154
===== ===== ====== =======
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 September 30, 2004, $9.2 million of contributions
have been made to the pension plans and $.3 million has been made to its other
postretirement benefit plans. The company presently anticipates contributing an
additional $.3 million and $.1 million to fund the pension plans and other
postretirement benefit plans, respectively, in 2004 for a total of $9.5 million
and $.4 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.
- 8 -
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 nine months ended September 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 quarter and the first nine 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 nine months of the year. The quarter reflected our 11th consecutive
quarter of year-over-year gross margin expansion, our ninth consecutive quarter
of year-over-year earnings growth, and our eighth consecutive quarter of
year-over-year growth in base business sales. All three of our segments
experienced organic growth led by our Pump Products business.
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 quarter 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. Although we have limited visibility on future business
conditions, we believe IDEX is well positioned for earnings growth as the
economy improves, based on our lower cost levels resulting from our operational
excellence initiatives. At the same time, we continue to invest in new products,
applications and global markets, while pursuing strategic acquisitions to drive
longer term profitable growth.
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,
- 9 -
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 SEPTEMBER 30, 2004 COMPARED TO THE SAME
PERIOD OF 2003
For the three months ended September 30, 2004, orders, sales and profits
were higher than the comparable third quarter of last year. New orders totaled
$235.0 million, 21% 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), Scivex (May 2004) and Dinglee
(July 2004) acquisitions, orders were 9% higher than the third quarter of 2003.
Sales in the third quarter were $237.6 million, a 20% improvement from
last year's third quarter as base business shipments grew 9%, foreign currency
translation provided a 3% improvement and acquisitions accounted for an 8%
increase. Base business sales grew 13% domestically and were up 4%
internationally during the quarter. Sales to international customers from base
businesses represented approximately 42% of total sales, compared with 44% in
2003.
For the quarter, the Pump Products Group contributed 60% of sales and 57%
of operating income, the Dispensing Equipment Group accounted for 17% of sales
and 16% of operating income, and the Other Engineered Products Group represented
23% of sales and 27% of operating income.
Pump Products Group sales of $142.4 million for the three months ended
September 30, 2004 rose $27.5 million, or 24% compared with 2003, reflecting 11%
base business growth, a 2% favorable impact from foreign currency translation,
and an 11% increase due to the acquisitions of Sponsler, Classic, Systec and
Scivex. In the third quarter of 2004, base business sales grew 12% domestically
and 10% 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 $40.0 million increased $3.2 million,
or 9%, in the third quarter of 2004 compared with last year's third quarter.
This increase was attributed to favorable foreign currency translation of 4% and
a 5% increase in base business volume. In the third quarter of 2004, base
business sales increased 14% domestically but decreased 1% internationally. Base
business sales to customers outside the U.S. were approximately 60% of total
group sales in the 2004 quarter, compared with 63% in 2003.
Other Engineered Products Group sales of $56.0 million increased by $9.6
million, or 21%, in the third quarter of 2004 compared with 2003. This increase
reflects an 8% increase in base business volume, favorable foreign currency
translation of 4% and a 9% increase due to the Vetter and Dinglee acquisitions.
In the third quarter of 2004, base business sales increased 17% domestically,
but declined 3% internationally. Base business sales to customers outside the
U.S. were approximately 38% of total group sales in the 2004 quarter, compared
with 42% in 2003.
- 10 -
IDEX CORPORATION AND SUBSIDIARIES
COMPANY AND BUSINESS GROUP FINANCIAL INFORMATION
(IN THOUSANDS)
(UNAUDITED)
THIRD QUARTER NINE MONTHS
ENDED SEPTEMBER 30, (1) ENDED SEPTEMBER 30, (1)
----------------------- -----------------------
2004 2003 2004 2003
-------- -------- -------- --------
Pump Products Group
Net sales ........................... $142,358 $114,906 $397,539 $339,047
Operating income (2) ................ 26,284 18,649 68,234 50,436
Operating margin .................... 18.5% 16.2% 17.2% 14.9%
Depreciation and amortization ....... $ 4,290 $ 4,139 $ 12,467 $ 12,630
Capital expenditures ................ 3,234 3,796 9,835 9,083
Dispensing Equipment Group
Net sales ........................... $ 40,028 $ 36,791 $127,546 $123,557
Operating income (2) ................ 7,348 5,878 26,590 20,587
Operating margin .................... 18.4% 16.0% 20.8% 16.7%
Depreciation and amortization ....... $ 1,384 $ 1,390 $ 4,218 $ 4,459
Capital expenditures ................ 545 582 1,961 1,655
Other Engineered Products Group
Net sales ........................... $ 56,005 $ 46,364 $162,889 $139,526
Operating income (2) ................ 12,501 8,660 34,052 24,581
Operating margin .................... 22.3% 18.7% 20.9% 17.6%
Depreciation and amortization ....... $ 1,546 $ 1,389 $ 4,649 $ 3,989
Capital expenditures ................ 940 723 2,462 2,658
Company
Net sales ........................... $237,557 $197,314 $685,747 $599,959
Operating income .................... 39,961 28,943 111,061 81,901
Operating margin .................... 16.8% 14.7% 16.2% 13.7%
Depreciation and amortization (3) ... $ 7,950 $ 7,520 $ 23,335 $ 22,887
Capital expenditures ................ 5,046 5,207 14,805 13,614
(1) Includes acquisitions of Sponsler (June 2003), Classic Engineering
(September 2003), Systec (April 2004) and Scivex (May 2004) in the Pump
Products Group and Manfred Vetter (January 2004) and Tianjin Dinglee (July
2004) in the Other Engineered Products Group from the dates of
acquisition.
(2) Group operating income excludes unallocated corporate operating expenses.
(3) Excludes amortization of debt issuance expenses.
- 11 -
Gross profit of $95.0 million in the third quarter of 2004 increased by
$18.8 million, or 25%, from 2003. Gross profit as a percent of sales was 40.0%
in 2004 and increased from 38.6% 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 $55.0
million in 2004 from $47.2 million in 2003 primarily due to acquisitions, and as
a percent of sales was 23.2%, down from 23.9% in 2003.
Operating income increased by $11.1 million, or 38%, to $40.0 million in
the third quarter of 2004 from $28.9 million in 2003, primarily reflecting the
higher gross margins partially offset by the increased SG&A expenses. Third
quarter operating margins were 16.8% of sales, 2.1 percentage points higher than
the third quarter of 2003. The improvement from last year resulted from a 1.4
percentage point increase in gross margins and a .7 percentage point decrease in
SG&A as a percent of sales. In the Pump Products Group, operating income of
$26.3 million and operating margins of 18.5% in the third quarter of 2004 were
up from the $18.6 million and 16.2% recorded in 2003 principally due to volume
leverage and the impact of our operational excellence initiatives. Operating
income for the Dispensing Equipment Group of $7.3 million and operating margins
of 18.4% in the third quarter of 2004 were up from the $5.9 million and 16.0% in
2003 primarily due to the company's operational excellence initiatives, as well
as volume improvement. Operating income in the Other Engineered Products Group
of $12.5 million and operating margins of 22.3% in the third quarter of 2004
increased from $8.7 million and 18.7% achieved in 2003 and primarily reflected
increased sales volume and the impact of operational excellence initiatives.
Other expense in the quarter was $.4 million and included approximately
$.7 million of hurricane - related costs incurred at our Punta Gorda, Florida,
pump manufacturing facility.
The provision for income taxes increased to $12.5 million in the third
quarter of 2004 from $9.1 million in 2003. The effective tax rate decreased to
35.0% in 2004 from 35.5% in 2003 due to a favorable impact from research and
development credits net of the resolution of certain tax matters.
Net income for the current quarter was $23.2 million, 41% higher than the
$16.5 million earned in the third quarter of 2003. Diluted earnings per share in
the third quarter of 2004 of $.44 increased $.11, or 33%, compared with the
third quarter of 2003.
PERFORMANCE IN THE NINE MONTHS ENDED SEPTEMBER 30, 2004 COMPARED TO THE SAME
PERIOD OF 2003
Orders, sales and profits were higher for the first nine months of 2004
compared with the same period last year. New orders for the first nine months of
2004 totaled $703.6 million, 16% higher than last year. Excluding the impact of
foreign currency translation and acquisitions, orders were 8% higher than the
comparable period of 2003.
Sales in the first nine months of 2004 increased 14% to $685.7 million
from $600.0 million a year ago. Base business sales rose 5%, foreign currency
translation added 3%, and acquisitions accounted for a 6% improvement. Base
business sales grew 9% domestically and 2% internationally during the first nine
months of 2004. For the first nine months of the year, base business sales to
international customers were approximately 44% of total sales, versus 45% in
2003.
For the first nine months of 2004, the Pump Products Group contributed 58%
of sales and 53% of operating income, the Dispensing Equipment Group accounted
for 18% of sales and 21% of operating income, and the Other Engineered Products
Group represented 24% of sales and 26% of operating income.
Pump Products Group sales of $397.5 million increased $58.5 million, or
17%, for the first nine months ended September 30, 2004 compared with 2003. Base
business sales provided an 8% increase, acquisitions accounted for a 7% sales
improvement and foreign currency translation added 2%. In the first nine months
of 2004, base business sales grew 10% domestically and 6% 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.
- 12 -
Dispensing Equipment Group sales of $127.5 million increased $4.0 million,
or 3%, in the first nine months of 2004 compared with the same period in 2003.
This increase was attributed to favorable foreign currency translation of 5%,
offset by a 2% decrease in base business volume. In the first nine months of
2004, base business sales increased 2% domestically, but declined 5%
internationally. Base business sales to customers outside the U.S. were
approximately 63% of total group sales in the first nine months of 2004,
compared with 64% in 2003.
Other Engineered Products Group sales of $162.9 million increased by $23.4
million, or 17%, in the first nine months of 2004 compared with 2003. This
reflected a 6% increase in base business volume, a 4% improvement from foreign
currency translation, and a 7% favorable impact from the Vetter and Dinglee
acquisitions. In the first nine months of 2004, base business sales increased
12% domestically and were down less than 1% internationally. Base business sales
to customers outside the U.S. were approximately 40% of total group sales in
2004, compared with 43% in 2003.
Gross profit of $274.6 million in the first nine months of 2004 increased
by $42.0 million, or 18%, 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 $29.2 million, or 36%, to $111.1 million in
the first nine months of 2004 from $81.9 million in 2003, primarily reflecting
the higher gross margins discussed above, partially offset by increased SG&A
expenses. Operating margins for the first nine months of 2004 were 16.2%
compared with 13.7% 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 $68.2 million
and operating margins of 17.2% in 2004 were up from the $50.4 million and 14.9%
recorded in 2003. Operating income for the Dispensing Equipment Group of $26.6
million and operating margins of 20.8% in 2004 were up from the $20.6 million
and 16.7% in 2003. Operating income in the Other Engineered Products Group of
$34.1 million and operating margins of 20.9% in 2004 increased from $24.6
million and 17.6% achieved in 2003.
SG&A increased to $163.6 million in the first nine months of 2004 from
$150.7 million in 2003, and as a percent of sales was 23.9%, down from 25.1% 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 nine months of 2004 of $.6 million was
unfavorable compared with $.4 million of income in 2003. The $1.0 million
variance was due to approximately $.7 million of hurricane-related costs
incurred at our Punta Gorda, Florida, pump manufacturing facility.
The provision for income taxes increased to $35.8 million in the first
nine months of 2004 from $25.4 million in 2003. The effective tax rate increased
to 36.0% 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 of a
favorable impact from research and development credits.
Net income for the first nine months of 2004 was $63.7 million, 38% higher
than the $46.1 million earned in the same period of 2003. Diluted earnings per
share in the first nine months of 2004 of $1.23 increased $.30, or 32%, compared
with the same period last year.
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 2004, working capital was $115.5 million and our current
ratio was 1.8 to 1. Cash flows from operating activities increased $3.9 million,
or 4%, to $94.2 million in 2004 mainly due to the improved operating results
discussed above partially offset by higher working capital.
Cash flows provided from operations was more than adequate to fund capital
expenditures of $14.8 million and $13.6 million in the first nine months 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,
- 13 -
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,
Scivex in May 2004 and Dinglee in July 2004 at a cost of $44.8 million, $22.4
million, $98.7 million and $4.2 million, respectively. All payments for
acquisitions were financed under the company's credit facility.
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
September 30, 2004, the maximum amount available under the Credit Facility was
$300.0 million, of which $66.0 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 $264.3 million at September 30,
2004, and based on the covenant, total debt outstanding was limited to $533.7
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 September 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 September 30, 2004, $25.0 million was borrowed
and included in long-term debt at an interest rate of approximately 1.9%.
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
September 30, 2004, $13.0 million was borrowed and included in long-term debt at
an interest rate of approximately 2.4%.
We believe the company will generate sufficient cash flow from operations
for the next 12 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
September 30, 2004, we have borrowed approximately $1,077.0 million under our
various credit agreements to complete 28 acquisitions. During the same period we
generated, principally from operations, cash flow of $978.0 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.
- 14 -
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 September 30, 2004 balances for goodwill and intangible assets
of $700.0 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 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 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, operating 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
$264.3 million of total debt outstanding at September 30, 2004. Approximately
43% 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 $.6 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.
- 15 -
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.
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, Massachusetts, Michigan, Mississippi, Nevada, New Jersey,
New York, Ohio, Pennsylvania, Texas, Utah, Washington and Wyoming. Most of the
claims resolved to date have been dismissed without payment. The balance 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.
- 16 -
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
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)
------ ---------------- -------------- ------------------- -------------------
July 1, 2004 to
July 31, 2004 - - - 2,240,250
August 1, 2004 to
August 31, 2004 - - - 2,240,250
September 1, 2004 to
September 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.
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.
The exhibits listed in the accompanying "Exhibit Index" are filed as part
of this report.
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
November 3, 2004 /s/ DOMINIC A. ROMEO
--------------------------------------------
Dominic A. Romeo
Vice President and Chief Financial Officer
(duly authorized principal financial officer)
- 17 -
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. 3 dated as of May 21, 2004 to the Credit Lyonnais
Uncommitted Line of Credit Agreement dated December 3, 2001
(incorporated by reference to Exhibit 4.6 (b) to the Quarterly
Report of IDEX on Form 10-Q for the quarter ended June 30, 2004,
Commission File No. 1-10235)
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)
- 18 -
EXHIBIT INDEX (CON'T.)
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
*10.1** Employment Agreement between IDEX Corporation and Lawrence D.
Kingsley, dated July 21, 2004
*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
** Management contract or compensatory plan or agreement
- 19 -