Dover Reports First Quarter 2021 Results; Raises 2021 Annual Guidance

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Dover Reports First Quarter 2021 Results; Raises 2021 Annual Guidance

DOWNERS GROVE, Ill., April 20, 2021 /PRNewswire/ -- Dover (NYSE: DOV), a diversified global manufacturer, announced its financial results for the first quarter ended March 31, 2021.

Three Months Ended March 31,

($ in millions, except per share data)

2021

2020

% Change

U.S. GAAP

Revenue

$

1,868

$

1,656

13

%

Net earnings 1

233

176

32

%

Diluted EPS 

1.61

1.21

33

%







Non-GAAP

Organic revenue change




9

%

Adjusted net earnings 2

263

203

29

%

Adjusted diluted EPS

1.81

1.39

30

%

1 Q1 2021 and 2020 net earnings include rightsizing and other costs of $3.1 million and $6.3 million, respectively. Q1 2020 also includes a $5.0 million non-cash after-tax gain on the sale of Chino.


2 Q1 2021 and 2020 adjusted net earnings exclude after tax acquisition-related amortization costs of $26.8 million and $25.7 million, respectively, and rightsizing and other costs of $3.1 million and $6.3 million, respectively. Q1 2020 also excludes a $5.0 million non-cash after-tax gain on the sale of Chino.

For the quarter ended March 31, 2021, Dover generated revenue of $1.9 billion, an increase of 13% (+9% organic) compared to the first quarter of the prior year. GAAP net earnings of $233 million increased 32%, and GAAP diluted EPS of $1.61 was up 33%. On an adjusted basis, net earnings of $263 million increased 29% and adjusted diluted EPS of $1.81 was up 30% versus the comparable quarter of the prior year.

A full reconciliation between GAAP and adjusted measures and definitions of non-GAAP and other performance measures are included as an exhibit herein.

MANAGEMENT COMMENTARY:

Dover's President and Chief Executive Officer, Richard J. Tobin, said, "Overall, we are off to an encouraging start with first quarter results that exceeded our forecasts. Our businesses capitalized on the improving demand conditions in their markets and delivered strong volume growth despite some notable supply chain disruptions during the quarter. Comparable operating margins increased in the quarter on volume leverage, favorable product mix, and continued progress on our center-led efficiency initiatives.

"Order trends were strong and improved throughout the quarter across the majority of our businesses. We saw particularly healthy new order activity in biopharma connectors and pumps, plastics & polymer processing, food retail, industrial pumps, refuse collection, and automotive-exposed markets. Several markets that are still recovering, such as foodservice equipment, digital printing and industrial winches have also been posting encouraging trends. As a result of strong orders, our backlog at the end of the first quarter was substantially higher than the backlog we carried into the quarter.

"As we look forward, our strong end market demand, bookings rates, and robust backlog give us confidence that market demand for our products will remain durable as we progress through the year. There are challenges to navigate going forward such as material cost inflation, supply chain bottlenecks, and labor availability, but our first quarter performance gives us grounds for optimism that we are up to the challenge. Furthermore, our balance sheet remains healthy and we have substantial capacity for inorganic capital deployment to continue enhancing our portfolio.

"On the back of a strong first quarter and the current trading environment, we are raising our full year revenue and EPS guidance."

FULL YEAR 2021 GUIDANCE UPDATE:

Guidance for full year 2021 revenue growth was raised to 10% to 12%. EPS guidance for full year 2021 was raised to $5.92 to $6.02 ($6.75 to $6.85 on an adjusted basis).

CONFERENCE CALL INFORMATION:

Dover will host a webcast and conference call to discuss its first quarter 2021 results and updated 2021 guidance at 10:00 A.M. Eastern Time (9:00 A.M. Central Time) on Tuesday, April 20, 2021. The webcast can be accessed on the Dover website at dovercorporation.com. The conference call will also be made available for replay on the website. Additional information on Dover's first quarter results and its operating segments can be found on the Company's website.

ABOUT DOVER:

Dover is a diversified global manufacturer and solutions provider with annual revenue of approximately $7 billion. We deliver innovative equipment and components, consumable supplies, aftermarket parts, software and digital solutions, and support services through five operating segments: Engineered Products, Fueling Solutions, Imaging & Identification, Pumps & Process Solutions and Refrigeration & Food Equipment. Dover combines global scale with operational agility to lead the markets we serve. Recognized for our entrepreneurial approach for over 60 years, our team of approximately 24,000 employees takes an ownership mindset, collaborating with customers to redefine what's possible. Headquartered in Downers Grove, Illinois, Dover trades on the New York Stock Exchange under "DOV." Additional information is available at dovercorporation.com.

FORWARD-LOOKING STATEMENTS:

This press release contains "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements in this document other than statements of historical fact are statements that are, or could be deemed, "forward-looking" statements. Forward-looking statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond the Company's control. Factors that could cause actual results to differ materially from current expectations include, among other things, the impacts of COVID-19, or other future pandemics, on the global economy and on our customers, suppliers, employees, business and cash flows, other general economic conditions and conditions in the particular markets in which we operate, changes in customer demand and capital spending, competitive factors and pricing pressures, our ability to develop and launch new products in a cost-effective manner, our ability to realize synergies from newly acquired businesses, and our ability to derive expected benefits from restructuring, productivity initiatives and other cost reduction actions. For details on the risks and uncertainties that could cause our results to differ materially from the forward-looking statements contained herein, we refer you to the documents we file with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2020, and our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. These documents are available from the Securities and Exchange Commission, and on our website, dovercorporation.com. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

 

INVESTOR SUPPLEMENT - FIRST QUARTER 2021


DOVER CORPORATION

CONSOLIDATED STATEMENTS OF EARNINGS

(unaudited)(in thousands, except per share data)



Three Months Ended March 31,

2021

2020

Revenue

$

1,867,901

$

1,655,939

Cost of goods and services

1,146,353

1,043,696

Gross profit

721,548

612,243

Selling, general, and administrative expenses

408,998

386,941

Operating earnings

312,550

225,302

Interest expense

26,823

27,268

Interest income

(680)

(1,183)

Gain on sale of a business

—

(6,551)

Other income, net

(2,843)

(7,732)

Earnings before provision for income taxes

289,250

213,500

Provision for income taxes

56,481

37,221

Net earnings

$

232,769

$

176,279




Net earnings per share:


Basic

$

1.62

$

1.22

Diluted

$

1.61

$

1.21

Weighted average shares outstanding:


Basic

143,765

144,259

Diluted

144,938

145,782




Dividends paid per common share

$

0.495

$

0.49




* Per share data may be impacted by rounding.


 

DOVER CORPORATION

QUARTERLY SEGMENT INFORMATION

(unaudited)(in thousands)


2021

2020

Q1

Q1

Q2

Q3

Q4

FY 2020

REVENUE






Engineered Products

$

428,127

$

408,160

$

342,380

$

386,562

$

394,175

$

1,531,277

Fueling Solutions

389,678

359,982

326,495

380,511

409,294

1,476,282

Imaging & Identification

284,328

256,765

227,977

265,690

287,746

1,038,178

Pumps & Process Solutions

394,377

319,536

309,095

347,875

347,497

1,324,003

Refrigeration & Food Equipment

372,077

311,913

293,527

368,395

342,255

1,316,090

Intra-segment eliminations

(686)

(417)

(299)

(777)

(577)

(2,070)

Total consolidated revenue

$

1,867,901

$

1,655,939

$

1,499,175

$

1,748,256

$

1,780,390

$

6,683,760








NET EARNINGS






Segment Earnings:






Engineered Products

$

68,779

$

69,094

$

47,702

$

64,890

$

56,481

$

238,167

Fueling Solutions

66,480

53,498

47,214

66,601

69,661

236,974

Imaging & Identification

56,992

51,482

38,046

51,928

52,017

193,473

Pumps & Process Solutions

123,645

66,079

67,702

89,786

81,709

305,276

Refrigeration & Food Equipment 1

38,117

23,529

11,459

40,159

27,725

102,872

Total segment earnings (EBIT)

354,013

263,682

212,123

313,364

287,593

1,076,762

Corporate expense / other

38,620

24,097

27,311

35,603

39,651

126,662

Interest expense

26,823

27,268

28,711

27,724

28,234

111,937

Interest income

(680)

(1,183)

(728)

(960)

(700)

(3,571)

Earnings before provision for income taxes

289,250

213,500

156,829

250,997

220,408

841,734

Provision for income taxes

56,481

37,221

32,063

50,697

38,302

158,283

Net earnings

$

232,769

$

176,279

$

124,766

$

200,300

$

182,106

$

683,451








SEGMENT MARGIN





Engineered Products

16.1 %

16.9 %

13.9 %

16.8 %

14.3 %

15.6 %

Fueling Solutions

17.1 %

14.9 %

14.5 %

17.5 %

17.0 %

16.1 %

Imaging & Identification

20.0 %

20.1 %

16.7 %

19.5 %

18.1 %

18.6 %

Pumps & Process Solutions

31.4 %

20.7 %

21.9 %

25.8 %

23.5 %

23.1 %

Refrigeration & Food Equipment 1

10.2 %

7.5 %

3.9 %

10.9 %

8.1 %

7.8 %

Total segment operating margin

19.0 %

15.9 %

14.1 %

17.9 %

16.2 %

16.1 %








DEPRECIATION AND AMORTIZATION EXPENSE


















Engineered Products

$

14,047

$

10,122

$

9,722

$

10,717

$

12,042

$

42,603

Fueling Solutions

19,269

18,339

17,968

18,014

18,482

72,803

Imaging & Identification

9,593

8,769

9,224

9,809

10,576

38,378

Pumps & Process Solutions

16,926

18,336

17,572

17,206

19,077

72,191

Refrigeration & Food Equipment

12,096

11,548

11,421

12,081

11,491

46,541

Corporate

1,875

1,638

1,696

1,662

1,539

6,535

Total depreciation and amortization expense

$

73,806

$

68,752

$

67,603

$

69,489

$

73,207

$

279,051









1 Q1, Q2, Q3, and FY 2020 include a $6,551 gain, a $781 expense, a $557 expense and a $5,213 net gain, respectively, on the sale of the Chino,
California branch of The AMS Group ("AMS Chino"). Q2 and FY 2020 also include a $3,640 write-off of assets.

 

DOVER CORPORATION

QUARTERLY EARNINGS PER SHARE

(unaudited)(in thousands, except per share data*)

Earnings Per Share







2021

2020

Q1

Q1

Q2

Q3

Q4

FY 2020

Net earnings per share:






Basic

$

1.62

$

1.22

$

0.87

$

1.39

$

1.27

$

4.74

Diluted

$

1.61

$

1.21

$

0.86

$

1.38

$

1.25

$

4.70








Net earnings and weighted average shares used in calculated earnings per share amounts are as follows:

Net earnings

$

232,769

$

176,279

$

124,766

$

200,300

$

182,106

$

683,451








Weighted average shares outstanding:








Basic

143,765

144,259

143,955

144,032

143,954

144,050

Diluted

144,938

145,782

144,995

145,289

145,355

145,393








* Per share data may be impacted by rounding.

 

DOVER CORPORATION

QUARTERLY ADJUSTED EARNINGS AND ADJUSTED EARNINGS PER SHARE (NON-GAAP)

(unaudited)(in thousands, except per share data*)

Non-GAAP Reconciliations


2021

2020

Q1

Q1

Q2

Q3

Q4

FY 2020

Adjusted net earnings:






Net earnings

$

232,769

$

176,279

$

124,766

$

200,300

$

182,106

$

683,451

Acquisition-related amortization, pre-tax 1

35,516

34,062

34,101

35,325

35,027

138,515

Acquisition-related amortization, tax impact 2

(8,720)

(8,411)

(8,451)

(8,810)

(8,695)

(34,367)

Rightsizing and other costs, pre-tax 3

4,162

7,859

16,840

5,848

20,925

51,472

Rightsizing and other costs, tax impact 2

(1,031)

(1,605)

(3,452)

(1,343)

(4,402)

(10,802)

(Gain) loss on disposition, pre-tax 4

—

(6,551)

781

557

—

(5,213)

(Gain) loss on disposition, tax-impact 2

—

1,592

(190)

(135)

—

1,267

Adjusted net earnings

$

262,696

$

203,225

$

164,395

$

231,742

$

224,961

$

824,323








Adjusted diluted net earnings per share:





Diluted net earnings per share

$

1.61

$

1.21

$

0.86

$

1.38

$

1.25

$

4.70

Acquisition-related amortization, pre-tax 1

0.25

0.23

0.24

0.24

0.24

0.95

Acquisition-related amortization, tax impact 2

(0.06)

(0.06)

(0.06)

(0.06)

(0.06)

(0.24)

Rightsizing and other costs, pre-tax 3

0.03

0.05

0.12

0.04

0.14

0.35

Rightsizing and other costs, tax impact 2

(0.01)

(0.01)

(0.02)

(0.01)

(0.03)

(0.07)

(Gain) loss on disposition, pre-tax 4

—

(0.04)

—

—

—

(0.03)

(Gain) loss on disposition, tax-impact 2 

—

0.01

—

—

—

0.01

Adjusted diluted net earnings per share

$

1.81

$

1.39

$

1.13

$

1.60

$

1.55

$

5.67









1 Includes amortization on acquisition-related intangible assets and inventory step-up.

2 Adjustments were tax effected using the statutory tax rates in the applicable jurisdictions or the effective tax rate, where applicable, for each period.

3 Rightsizing and other costs include actions taken on employee reductions, facility consolidations and site closures, product line exits and other asset charges.

4 Represents a (gain) loss on the disposition of AMS Chino within the Refrigeration & Food Equipment segment, including working capital adjustments.









* Per share data and totals may be impacted by rounding.

 

DOVER CORPORATION

QUARTERLY SEGMENT ADJUSTED EBIT AND ADJUSTED EBITDA (NON-GAAP)

(unaudited)(in thousands)

Non-GAAP Reconciliations


2021

2020

Q1

Q1

Q2

Q3

Q4

FY 2020

ADJUSTED SEGMENT EBIT AND ADJUSTED EBITDA








Engineered Products:








Segment earnings (EBIT)

$

68,779

$

69,094

$

47,702

$

64,890

$

56,481

$

238,167

Rightsizing and other costs

4,019

361

4,169

2,375

4,625

11,530

Adjusted EBIT - Segment

72,798

69,455

51,871

67,265

61,106

249,697

Adjusted EBIT %

17.0 %

17.0 %

15.2 %

17.4 %

15.5 %

16.3 %

Adjusted D&A 1

10,594

10,122

9,722

10,651

10,193

40,688

Adjusted EBITDA - Segment

$

83,392

$

79,577

$

61,593

$

77,916

$

71,299

$

290,385

Adjusted EBITDA %

19.5 %

19.5 %

18.0 %

20.2 %

18.1 %

19.0 %

Fueling Solutions:






Segment earnings (EBIT)

$

66,480

$

53,498

$

47,214

$

66,601

$

69,661

$

236,974

Rightsizing and other costs

58

1,493

868

1,615

2,727

6,703

Adjusted EBIT - Segment

66,538

54,991

48,082

68,216

72,388

243,677

Adjusted EBIT %

17.1 %

15.3 %

14.7 %

17.9 %

17.7 %

16.5 %

Adjusted D&A 1

19,180

18,339

17,783

18,014

18,225

72,361

Adjusted EBITDA - Segment

$

85,718

$

73,330

$

65,865

$

86,230

$

90,613

$

316,038

Adjusted EBITDA %

22.0 %

20.4 %

20.2 %

22.7 %

22.1 %

21.4 %

Imaging & Identification:






Segment earnings (EBIT)

$

56,992

$

51,482

$

38,046

$

51,928

$

52,017

$

193,473

Rightsizing and other costs

682

264

(527)

99

6,191

6,027

Adjusted EBIT - Segment

57,674

51,746

37,519

52,027

58,208

199,500

Adjusted EBIT %

20.3 %

20.2 %

16.5 %

19.6 %

20.2 %

19.2 %

Adjusted D&A 1

9,218

8,769

9,224

9,809

10,201

38,003

Adjusted EBITDA - Segment

$

66,892

$

60,515

$

46,743

$

61,836

$

68,409

$

237,503

Adjusted EBITDA %

23.5 %

23.6 %

20.5 %

23.3 %

23.8 %

22.9 %

Pumps & Process Solutions:






Segment earnings (EBIT)

$

123,645

$

66,079

$

67,702

$

89,786

$

81,709

$

305,276

Rightsizing and other (benefits) costs

(2,006)

3,846

4,691

1,771

3,128

13,436

Adjusted EBIT - Segment

121,639

69,925

72,393

91,557

84,837

318,712

Adjusted EBIT %

30.8 %

21.9 %

23.4 %

26.3 %

24.4 %

24.1 %

Adjusted D&A 1

16,926

16,230

16,816

17,206

17,565

67,817

Adjusted EBITDA - Segment

$

138,565

$

86,155

$

89,209

$

108,763

$

102,402

$

386,529

Adjusted EBITDA %

35.1 %

27.0 %

28.9 %

31.3 %

29.5 %

29.2 %

Refrigeration & Food Equipment:





Segment earnings (EBIT)

$

38,117

$

23,529

$

11,459

$

40,159

$

27,725

$

102,872

Rightsizing and other (benefits) costs

(38)

704

6,016

(971)

726

6,475

(Gain) loss on disposition 2

—

(6,551)

781

557

—

(5,213)

Adjusted EBIT - Segment

38,079

17,682

18,256

39,745

28,451

104,134

Adjusted EBIT %

10.2 %

5.7 %

6.2 %

10.8 %

8.3 %

7.9 %

Adjusted D&A 1

11,745

11,548

11,421

12,081

11,491

46,541

Adjusted EBITDA - Segment

$

49,824

$

29,230

$

29,677

$

51,826

$

39,942

$

150,675

Adjusted EBITDA %

13.4 %

9.4 %

10.1 %

14.1 %

11.7 %

11.4 %

Total Segments:





Segment earnings (EBIT) 3

$

354,013

$

263,682

$

212,123

$

313,364

$

287,593

$

1,076,762

Rightsizing and other costs

2,715

6,668

15,217

4,889

17,397

44,171

(Gain) loss on disposition 2

—

(6,551)

781

557

—

(5,213)

Adjusted EBIT - Segment 4

356,728

263,799

228,121

318,810

304,990

1,115,720

Adjusted EBIT % 4

19.1 %

15.9 %

15.2 %

18.2 %

17.1 %

16.7 %

Adjusted D&A 1

67,663

65,008

64,966

67,761

67,675

265,410

Adjusted EBITDA - Segment 4

$

424,391

$

328,807

$

293,087

$

386,571

$

372,665

$

1,381,130

Adjusted EBITDA % 4

22.7 %

19.9 %

19.5 %

22.1 %

20.9 %

20.7 %









1 Adjusted D&A is depreciation and amortization expense, excluding depreciation and amortization included within rightsizing and other costs.

2 Q1, Q2, Q3, and FY 2020 includes a $6,551 gain, a $781 expense, a $557 expense and a $5,213 net gain on the sale of a business for AMS Chino, respectively.

3 Refer to Quarterly Segment Information section for reconciliation of total segment earnings (EBIT) to net earnings.

4 Refer to Non-GAAP Disclosures section for definition.

 

DOVER CORPORATION

REVENUE GROWTH FACTORS (NON-GAAP)

(unaudited)(in thousands, except per share data*)

Non-GAAP Reconciliations

Revenue Growth Factors



2021


Q1

Organic

Engineered Products

2.3

%

Fueling Solutions

3.0

%

Imaging & Identification

3.7

%

Pumps & Process Solutions

18.4

%

Refrigeration & Food Equipment

18.3

%

Total Organic

8.8

%

Acquisitions

1.2

%

Dispositions

(0.3)

%

Currency translation

3.1

%

Total*

12.8

%

 * Totals may be impacted by rounding.




2021


Q1

Organic

United States

6.9

%

Other Americas

3.0

%

Europe

12.7

%

Asia 

19.8

%

Other

(4.7)

%

Total Organic

8.8

%

Acquisitions

1.2

%

Dispositions

(0.3)

%

Currency translation

3.1

%

Total*

12.8

%

 * Totals may be impacted by rounding.

 

Adjusted EPS Guidance Reconciliation

Range

2021 Guidance for Earnings per Share (GAAP)

$

5.92

$

6.02

Acquisition-related amortization, net

0.73

Rightsizing and other costs, net

0.10

2021 Guidance for Adjusted Earnings per Share (Non-GAAP)

$

6.75

$

6.85

 

DOVER CORPORATION

QUARTERLY CASH FLOW AND FREE CASH FLOW (NON-GAAP)

(unaudited)(in thousands)

Quarterly Cash Flow


2021

2020

Q1

Q1

Q2

Q3

Q4

FY 2020

Net Cash Flows Provided By (Used In):





Operating activities

$

177,184

$

75,863

$

271,809

$

339,247

$

417,891

$

1,104,810

Investing activities

(29,572)

(230,511)

(67,763)

(64,724)

(118,381)

(481,379)

Financing activities

(124,239)

280,954

(67,458)

(496,832)

(222,954)

(506,290)


Quarterly Free Cash Flow (Non-GAAP)


2021

2020

Q1

Q1

Q2

Q3

Q4

FY 2020

Cash flow from operating activities1

$

177,184

$

75,863

$

271,809

$

339,247

$

417,891

$

1,104,810

Less: Capital expenditures

(31,260)

(40,172)

(38,999)

(44,393)

(42,128)

(165,692)

Free cash flow

$

145,924

$

35,691

$

232,810

$

294,854

$

375,763

$

939,118








Free cash flow as a percentage of revenue

7.8 %

2.2 %

15.5 %

16.9 %

21.1 %

14.1 %








Free cash flow as a percentage of net earnings

62.7 %

20.2 %

186.6 %

147.2 %

206.3 %

137.4 %








1 FY 2020 cash flow from operating activities reflects benefits from permitted deferrals of tax payments, most significantly in Q2, Q3, and Q4 and advanced payments on contracts, most significantly in Q3.

 

DOVER CORPORATION

PERFORMANCE MEASURES

(unaudited)(in thousands)


2021

2020

Q1

Q1

Q2

Q3

Q4

FY 2020

BOOKINGS














Engineered Products

$

528,310

$

414,972

$

278,373

$

381,139

$

484,002

$

1,558,486

Fueling Solutions

422,668

373,070

311,498

383,902

403,400

1,471,870

Imaging & Identification

293,614

272,604

221,315

266,423

304,756

1,065,098

Pumps & Process Solutions

551,365

369,403

275,872

323,801

365,262

1,334,338

Refrigeration & Food Equipment

537,326

355,157

326,400

449,549

379,393

1,510,499

Intra-segment eliminations

(863)

(375)

(460)

(926)

(425)

(2,186)

Total consolidated bookings

$

2,332,420

$

1,784,831

$

1,412,998

$

1,803,888

$

1,936,388

$

6,938,105








BACKLOG














Engineered Products

$

562,557

$

453,867

$

378,874

$

373,458

$

463,701

Fueling Solutions

238,822

211,518

199,305

204,574

201,521

Imaging & Identification

198,556

170,119

168,904

171,158

192,785

Pumps & Process Solutions

539,097

397,969

379,090

361,631

390,238

Refrigeration & Food Equipment

677,309

356,133

390,368

472,140

510,498

Intra-segment eliminations

(544)

(159)

(367)

(269)

(192)

Total consolidated backlog

$

2,215,797

$

1,589,447

$

1,516,174

$

1,582,692

$

1,758,551









 

Bookings Growth Factors


2021

Q1

Organic

Engineered Products

24.8

%

Fueling Solutions

7.3

%

Imaging & Identification

0.1

%

Pumps & Process Solutions

44.0

%

Refrigeration & Food Equipment

50.7

%

Total Organic

26.5

%

Acquisitions

1.5

%

Dispositions

(0.3)

%

Currency translation

3.0

%

Total*

30.7

%

* Totals may be impacted by rounding.

Non-GAAP Measures Definitions

In an effort to provide investors with additional information regarding our results as determined by GAAP, management also discloses non-GAAP information that management believes provides useful information to investors. Adjusted net earnings, adjusted diluted net earnings per share, total segment earnings (EBIT), adjusted EBIT by segment, adjusted EBIT margin by segment, adjusted EBITDA by segment, adjusted EBITDA margin by segment, free cash flow, free cash flow as a percentage of revenue, free cash flow as a percentage of net earnings, and organic revenue growth are not financial measures under GAAP and should not be considered as a substitute for net earnings, diluted net earnings per share, cash flows from operating activities, or revenue as determined in accordance with GAAP, and they may not be comparable to similarly titled measures reported by other companies. 

Adjusted net earnings represents net earnings adjusted for the effect of acquisition-related amortization, rightsizing and other costs, and a gain/loss on disposition. We exclude after-tax acquisition-related amortization because the amount and timing of such charges are significantly impacted by the timing, size, number and nature of the acquisitions the Company consummates. We exclude the other items because they occur for reasons that may be unrelated to the Company's commercial performance during the period and/or Management believes they are not indicative of the Company's ongoing operating costs or gains in a given period.

Adjusted diluted net earnings per share represents adjusted net earnings divided by average diluted shares.

Total segment earnings (EBIT) is defined as net earnings before income taxes, net interest expense and corporate expenses. Total segment earnings (EBIT) margin is defined as total segment earnings (EBIT) divided by revenue.

Adjusted EBIT by Segment is defined as net earnings before income taxes, net interest expense, corporate expenses, rightsizing and other costs, and a 2020 gain/loss on disposition. Adjusted EBIT Margin by Segment is defined as adjusted EBIT by segment divided by segment revenue.

Adjusted EBITDA by Segment is defined as adjusted EBIT by segment plus depreciation and amortization, excluding depreciation and amortization included within rightsizing and other costs. Adjusted EBITDA Margin by Segment is defined as adjusted EBITDA by segment divided by segment revenue.

Management believes these measures are useful to investors to better understand the Company's ongoing profitability as it will better reflect the Company's core operating results, offer more transparency and facilitate easier comparability to prior and future periods and to its peers.

Free cash flow represents net cash provided by operating activities minus capital expenditures. Free cash flow as a percentage of revenue equals free cash flow divided by revenue. Free cash flow as a percentage of net earnings equals free cash flow divided by net earnings. Management believes that free cash flow and free cash flow ratios are important measures of operating performance because it provides management and investors a measurement of cash generated from operations that is available for mandatory payment obligations and investment opportunities, such as funding acquisitions, paying dividends, repaying debt and repurchasing our common stock.

Management believes that reporting organic revenue growth, which excludes the impact of foreign currency exchange rates and the impact of acquisitions and dispositions, provides a useful comparison of our revenue and bookings performance and trends between periods.

Performance Measures Definitions

Bookings represent total orders received from customers in the current reporting period. This metric is an important measure of performance and an indicator of revenue order trends.

Organic bookings represent total orders received from customers in the current reporting period excluding the impact of foreign currency exchange rates and the impact of acquisition and dispositions. This metric is an important measure of performance and an indicator of revenue order trends.

Backlog represents an estimate of the total remaining bookings at a point in time for which performance obligations have not yet have satisfied. This metric is useful as it represents the aggregate amount we expect to recognize as revenue in the future.

We use the above operational metrics in monitoring the performance of the business. We believe the operational metrics are useful to investors and other users of our financial information in assessing the performance of our segments.

Investor Contact:

Media Contact:

Andrey Galiuk

Adrian Sakowicz

Vice President - Corporate Development

Vice President - Communications

and Investor Relations

(630) 743-5039

(630) 743-5131

asakowicz@dovercorp.com 

agaliuk@dovercorp.com 

 

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SOURCE Dover