UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 25, 2006

DOVER CORPORATION

(Exact Name of Registrant as Specified in Charter)

STATE OF DELAWARE		1-4018		53-0257888
(State or other Jurisdiction		(Commission File Number)		(I.R.S. Employer
of Incorporation)				Identification No.)
280 Park Avenue, New York, NY				10017
(Address of Principal Executive Offices)				(Zip Code)

(212) 922-1640
(Registrant’s telephone number, including area code)

(Former Name or Former address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02 Results of Operations and Financial Condition.

On July 25, 2006, Dover Corporation issued the press release attached hereto as Exhibit 99.1 announcing its results of operations for its quarter ended June 30, 2006.

The information in this Current Report on Form 8-K, including Exhibits, is being furnished to the Securities and Exchange Commission (the “SEC”) and shall not be deemed to be incorporated by reference into any of Dover’s filings with the SEC under the Securities Act of 1933.

Item 9.01 Financial Statements and Exhibits.

(a)		Financial statements of businesses acquired.
		Not applicable.
(b)		Pro forma financial information.
		Not applicable.
(c)		Shell company transactions.
		Not applicable.
(d)		Exhibits.
		The following exhibit is furnished as part of this report:
		99.1      Press Release of Dover Corporation, dated July 25, 2006.

SIGNATURES

          Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

Date: July 25, 2006		DOVER CORPORATION (Registrant)
		By:		/s/ Joseph W. Schmidt   Joseph W. Schmidt
				Vice President, General Counsel & Secretary

EXHIBIT INDEX

Number		Exhibit
99.1		Press Release of Dover Corporation, dated July 25, 2006

Exhibit 99.1

CONTACT:				READ IT ON THE WEB
Robert G. Kuhbach				www.dovercorporation.com
Vice President Finance &
Chief Financial Officer
(212) 922-1640				July 25, 2006

DOVER REPORTS SECOND QUARTER 2006 RESULTS

Announces Second Quarter Revenue and Earnings
and Planned Divestiture of Seven Businesses

New York, New York, July 25, 2006 — Dover Corporation (NYSE: DOV) announced that for the second quarter ended June 30, 2006, it had record earnings from continuing operations of $158.7 million or $0.77 diluted earnings per share (“EPS”), compared to $109.5 million or $0.54 EPS from continuing operations in the prior-year period, representing significant increases of 45% and 44%, respectively. Revenue for the second quarter of 2006 was $1,655.4 million, an increase of 24% over the prior-year period. Earnings from continuing operations for the second quarter of 2006 included $0.02 EPS related to the expensing of stock options and stock appreciation rights.

Net earnings for the second quarter of 2006 were $71.9 million or $0.35 EPS, including a loss from discontinued operations of $86.7 million or $0.42 EPS, compared to net earnings of $173.2 million or $0.85 EPS for the same period of 2005, which included earnings from discontinued operations of $63.7 million or $0.31 EPS. Included in the 2005 period was a gain from the sale of a business, while the 2006 quarterly results include impairments related to discontinued companies.

Earnings from continuing operations for the six months ended June 30, 2006 were $290.0 million or $1.41 EPS, up 44%, compared to $201.1 million or $0.98 EPS in the prior year. Earnings from continuing operations for the six months ended June 30, 2006 included $0.04 EPS related to the expensing of stock options and stock appreciation rights. Net earnings were $275.7 million or $1.34 EPS, compared to $271.3 million or $1.33 EPS in the prior year.

Commenting on the second quarter results, Dover’s President and Chief Executive Officer, Ronald L. Hoffman, stated: “Dover had an excellent second quarter, generating record revenue and earnings, significant operating margin improvement and strong cash flow. Our record performance was driven by a strong organic growth rate of 17% as well as significant contributions from our recent acquisitions. Dover’s ability to deliver consecutive double-digit increases in organic growth validates our focus on operational excellence and our highly successful “Performance Counts“ initiative. Our operating margin increased 200 basis points over the previous year and is now approaching 16%. It’s also important to note that 74% of Dover’s second quarter revenue was generated by operating companies with margins above 15% and that 37% of our revenue in the quarter was attributable to companies with inventory turns of greater than eight. We reinvested a portion of Dover’s free cash flow, which was 8.4% of revenue, in the acquisition of O’Neil Product Development Inc., a synergistic addition to our Product Identification group. We also purchased 700,000 shares of Dover’s stock on the open market. Going forward, we anticipate the acquisition pipeline to remain active and are engaged in a number of evaluations and negotiations.”

Dover also announced today that it discontinued seven businesses during the second quarter of 2006 – five from the Dover Technologies segment, one from Dover Electronics and one from Dover Industries. The five discontinued businesses from Dover Technologies are Universal Instruments, Hover-Davis, Vitronics Soltec and Alphasem from the Circuit Assembly and Test Group and Mark Andy from the Product Identification Group. In 2005, these five businesses had total revenue and earnings of $580.2 million and $26.7 million, respectively, and the 2006 year-to-date revenue and earnings were $291.8 million and $9.3 million, respectively. The two other businesses that Dover discontinued were Kurz-Kasch, from the Dover Electronics’ Components Group, and a product line in the Dover Industries’ segment. These seven businesses collectively generated an operating margin of 4.3% for the full year 2005 and 2.9% for 2006 year-to-date.

As a result of classifying these businesses as discontinued operations, Dover’s overall margin from continuing operations in both the second quarter and year-to-date 2006 have improved by 120 basis points, and by 100 basis points in both of the comparable 2005 periods. The company anticipates that continued strong organic growth, as well as the full-year effect of its 2005 acquisitions, should offset the majority of the reduction in revenue and earnings related to these discontinued operations in 2006.

Commenting on this announcement, Mr. Hoffman stated, “These divestitures represent the culmination of the strategic portfolio review that we initiated in January 2005, when I became Chief Executive Officer, to position Dover as a vehicle for more consistent and sustainable value creation over the long term. Each of our six subsidiary Presidents played a vital role in this important evaluation process. The majority of the companies identified for sale manufacture capital equipment where the served markets are narrow in scope and recurring revenue opportunities are limited. While making decisions of this kind is never easy, we are confident that the sale of these businesses will enhance our ability to generate more consistent and sustained revenue and earnings growth. Despite the substantial reduction of our exposure to the technology sector, Dover will maintain a solid presence in core technology markets where it has well-established leadership positions and can capitalize on attractive recurring revenue opportunities. Dover also remains keenly committed to maintaining its strong and growing position in the Product Identification market.

“This strategic rebalancing of our portfolio, which is now substantially complete, coupled with our improved operational performance driven by the “Performance Counts” program and the continued success of our organic growth initiatives, position Dover well in an increasingly competitive global marketplace,” concluded Mr. Hoffman.

In connection with the discontinuance of the seven businesses, Dover recorded an after-tax charge of $87.9 million, reflecting the anticipated loss on sale for certain of these businesses. Any gains from the sale of the seven businesses will be recorded upon the close of the transactions.

Assuming all businesses currently in discontinued operations are sold by the end of 2006, the Company anticipates receiving after-tax proceeds in the range of $325 million.

All of Dover’s results are presented on a comparable basis to reflect the discontinuance of the seven operations for all periods presented.

Dover will host a Webcast of its second quarter 2006 conference call at 9:00 AM Eastern Time on Wednesday July 26, 2006. The Webcast can be accessed at the Dover Corporation website at www.dovercorporation.com. The conference call will also be made available for replay on the website and additional information on Dover’s second quarter 2006 results and its operating companies can also be found on the Company website and in the Company’s Form 10-Q filed after this release.

Dover Corporation makes information available to the public, orally and in writing, which may use words like “anticipates,” “expects,” “believes,” “indicates,” “suggests,” and “should,” which are “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. This

press release contains forward-looking statements regarding future events and the performance of Dover Corporation that involve risks and uncertainties that could cause actual results to differ materially from current expectations, including, but not limited to, failure to achieve expected synergies, the impact of continued events in the Middle East on the worldwide economy, economic conditions, increases in the cost of raw materials, changes in customer demand, increased competition in the markets served by Dover Corporation’s operating companies, the impact of natural disasters, such as hurricanes, and their effect on global energy markets and other risks. Dover Corporation refers you to the documents that it files from time to time with the Securities and Exchange Commission, such as its reports on Form 10-K, Form 10-Q and Form 8-K, which contain additional important factors that could cause its actual results to differ from its current expectations and from the forward-looking statements contained in this press release.

TABLES FOLLOW

DOVER CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited) (in thousands, except per share figures)

		Three Months Ended June 30,								Six Months Ended June 30,
		2006				2005				2006				2005
Revenue		$	1,655,397			$	1,333,319			$	3,161,627			$	2,558,174
Cost of goods and services			1,039,667				864,273				1,996,748				1,657,915
Gross profit			615,730				469,046				1,164,879				900,259
Selling and administrative expenses			367,232				304,163				703,866				599,359
Operating earnings			248,498				164,883				461,013				300,900
Interest expense, net			19,266				15,241				40,746				31,356
Other expense (income), net			4,139				(5,711	)			6,974				(8,441	)
Total interest/other expense, net			23,405				9,530				47,720				22,915
Earnings before provision for income taxes and discontinued operations			225,093				155,353				413,293				277,985
Provision for income taxes			66,435				45,880				123,285				76,903
Earnings from continuing operations			158,658				109,473				290,008				201,082
Earnings (loss) from discontinued operations, net			(86,747	)			63,728				(14,271	)			70,253
Net earnings		$	71,911			$	173,201			$	275,737			$	271,335
Basic earnings (loss) per common share:
Earnings from continuing operations		$	0.78			$	0.54			$	1.42			$	0.99
Earnings (loss) from discontinued operations			(0.43	)			0.31				(0.07	)			0.35
Net earnings			0.35				0.85				1.35				1.33
Weighted average shares outstanding			203,897				202,959				203,602				203,303
Diluted earnings (loss) per common share:
Earnings from continuing operations		$	0.77			$	0.54			$	1.41			$	0.98
Earnings (loss) from discontinued operations			(0.42	)			0.31				(0.07	)			0.34
Net earnings			0.35				0.85				1.34				1.33
Weighted average shares outstanding			205,615				203,984				205,234				204,417
Dividends paid per common share		$	0.17			$	0.16			$	0.34			$	0.32

The following table is a reconciliation of the share amounts used in computing earnings per share:

		Three Months Ended June 30,								Six Months Ended June 30,
		2006				2005				2006				2005
Weighted average shares outstanding — Basic			203,897				202,959				203,602				203,303
Dilutive effect of assumed exercise of employee stock options			1,718				1,025				1,632				1,114
Weighted average shares outstanding — Diluted			205,615				203,984				205,234				204,417
Anti-dilutive shares excluded from diluted EPS computation			1,875				8,906				6,141				8,357

DOVER CORPORATION
MARKET SEGMENT RESULTS
(unaudited)

(in thousands)		Three Months Ended June 30,								Six Months Ended June 30,
		2006				2005				2006				2005
REVENUE
Diversified		$	208,148			$	196,969			$	408,012			$	382,027
Electronics			222,751				121,700				422,246				238,680
Industries			215,338				210,450				423,909				404,405
Resources			435,341				377,135				860,503				733,442
Systems			234,124				177,735				415,409				333,606
Technologies			343,367				252,005				638,308				471,089
Intramarket eliminations			(3,672	)			(2,675	)			(6,760	)			(5,075	)
Total consolidated revenue		$	1,655,397			$	1,333,319			$	3,161,627			$	2,558,174
EARNINGS FROM CONTINUING OPERATIONS
Segment Earnings:
Diversified		$	23,037			$	22,975			$	45,714			$	43,399
Electronics			29,862				12,259				50,616				21,486
Industries			30,208				24,418				57,536				46,336
Resources			80,919				65,545				163,716				128,292
Systems			38,341				26,910				65,312				48,947
Technologies			60,684				33,284				108,396				50,874
Total segments			263,051				185,391				491,290				339,334
Corporate expense / other			(18,692	)			(14,797	)			(37,251	)			(29,993	)
Net interest expense			(19,266	)			(15,241	)			(40,746	)			(31,356	)
Earnings before provision for income taxes and discontinued operations			225,093				155,353				413,293				277,985
Provision for income taxes			(66,435	)			(45,880	)			(123,285	)			(76,903	)
Earnings from continuing operations — total consolidated		$	158,658			$	109,473			$	290,008			$	201,082

DOVER CORPORATION
QUARTERLY MARKET SEGMENT INFORMATION (1)
(unaudited) (In thousands)

DIVERSIFIED

		2005																2006
		1 Qtr.				2 Qtr.				3 Qtr.				4 Qtr.				1 Qtr.				2 Qtr.
Revenue		$	185,058			$	196,969			$	185,050			$	182,006			$	199,864			$	208,148
Segment earnings			20,424				22,975				23,121				20,770				22,676				23,037
Bookings			231,308				199,741				184,191				194,965				214,317				216,659
Backlog			294,605				296,607				296,561				308,587				321,310				327,943
Book-to-Bill			1.25				1.01				1.00				1.07				1.07				1.04
Operating margin			11.0	%			11.7	%			12.5	%			11.4	%			11.3	%			11.1	%

ELECTRONICS

		2005																2006
		1 Qtr.				2 Qtr.				3 Qtr.				4 Qtr.				1 Qtr.				2 Qtr.
Revenue		$	116,980			$	121,700			$	112,781			$	194,582			$	199,495			$	222,751
Segment earnings			9,227				12,259				5,208				20,194				20,753				29,862
Bookings			122,960				117,234				118,483				213,304				223,559				219,784
Backlog			83,269				78,197				93,459				141,102				165,253				163,182
Book-to-Bill			1.05				0.96				1.05				1.10				1.12				0.99
Operating margin			7.9	%			10.1	%			4.6	%			10.4	%			10.4	%			13.4	%

INDUSTRIES

		2005																2006
		1 Qtr.				2 Qtr.				3 Qtr.				4 Qtr.				1 Qtr.				2 Qtr.
Revenue		$	193,955			$	210,450			$	206,274			$	207,267			$	208,571			$	215,338
Segment earnings			21,918				24,418				28,180				29,764				27,328				30,208
Bookings			196,455				209,887				214,974				224,942				219,423				232,185
Backlog			197,043				196,445				205,286				222,793				234,174				251,301
Book-to-Bill			1.01				1.00				1.04				1.09				1.05				1.08
Operating margin			11.3	%			11.6	%			13.7	%			14.4	%			13.1	%			14.0	%

RESOURCES

		2005																2006
		1 Qtr.				2 Qtr.				3 Qtr.				4 Qtr.				1 Qtr.				2 Qtr.
Revenue		$	356,307			$	377,135			$	390,249			$	395,247			$	425,162			$	435,341
Segment earnings			62,747				65,545				65,077				67,302				82,797				80,919
Bookings			387,122				375,164				394,567				393,148				454,669				441,761
Backlog			167,810				165,087				169,580				167,561				196,379				203,757
Book-to-Bill			1.09				0.99				1.01				0.99				1.07				1.01
Operating margin			17.6	%			17.4	%			16.7	%			17.0	%			19.5	%			18.6	%

QUARTERLY MARKET SEGMENT INFORMATION (continued) (1)
(unaudited) (In thousands)

SYSTEMS

		2005																2006
		1 Qtr.				2 Qtr.				3 Qtr.				4 Qtr.				1 Qtr.				2 Qtr.
Revenue		$	155,871			$	177,735			$	197,076			$	174,695			$	181,285			$	234,124
Segment earnings			22,037				26,910				29,221				21,920				26,971				38,341
Bookings			156,181				221,709				201,361				176,185				231,036				229,633
Backlog			125,037				170,238				172,806				174,402				223,843				218,360
Book-to-Bill			1.00				1.25				1.02				1.01				1.27				0.98
Operating margin			14.1	%			15.1	%			14.8	%			12.5	%			14.9	%			16.4	%

TECHNOLOGIES

		2005																2006
		1 Qtr.				2 Qtr.				3 Qtr.				4 Qtr.				1 Qtr.				2 Qtr.
Revenue		$	219,084			$	252,005			$	275,612			$	287,151			$	294,941			$	343,367
Segment earnings			17,590				33,284				44,591				35,920				47,712				60,684
Bookings			233,611				275,436				261,722				288,104				339,124				325,101
Backlog			90,426				109,210				102,232				102,207				147,984				141,526
Book-to-Bill			1.07				1.09				0.95				1.00				1.15				0.95
Operating margin			8.0	%			13.2	%			16.2	%			12.5	%			16.2	%			17.7	%

QUARTERLY EPS & EARNINGS
(unaudited) (in thousands)

		2005																2006
		1 Qtr.				2 Qtr.				3 Qtr.				4 Qtr.				1 Qtr.				2 Qtr.
Net earnings (loss)
Continuing operations		$	91,607			$	109,473			$	123,042			$	119,457			$	131,350			$	158,658
Discontinued operations			6,525				63,729				(362	)			(3,328	)			72,477				(86,747	)
Net earnings			98,134				173,201				122,680				116,126				203,826				71,911
Basic earnings (loss) per common share:
Continuing operations		$	0.45			$	0.54			$	0.61			$	0.59			$	0.65			$	0.78
Discontinued operations			0.03				0.31				(0.00	)			(0.02	)			0.36				(0.43	)
Net earnings			0.48				0.85				0.61				0.57				1.00				0.35
Diluted earnings (loss) per common share:
Continuing operations		$	0.45			$	0.54			$	0.60			$	0.59			$	0.64			$	0.77
Discontinued operations			0.03				0.31				(0.00	)			(0.02	)			0.35				(0.42	)
Net earnings			0.48				0.85				0.60				0.57				0.99				0.35