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2015.01.27 8-K


 
 
 
 
 

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): January 27, 2015
________________________________
 
DOVER CORPORATION
(Exact name of registrant as specified in its charter)
________________________________
 

State of Delaware
1-4018
53-0257888
(State or other jurisdiction of incorporation)
 (Commission File Number)
(I.R.S. Employer Identification No.)
 
 
 
3005 Highland Parkway
 
 
Downers Grove, Illinois
 
60515
(Address of principal executive offices)
 
(Zip Code)
(630) 541-1540
(Registrant’s telephone number, including area code)
 
______________________

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:
 
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
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 January 27, 2015, Dover Corporation (i) issued the Press Release attached hereto as Exhibit 99.1 announcing its results of operations for the quarter and year ended December 31, 2014; and (ii) posted on its website at
http://www.dovercorporation.com the presentation slides attached hereto as Exhibit 99.2 for the quarter and year ended December 31, 2014.
 
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.

(d) Exhibits.

The following exhibits are furnished as part of this report:
 
99.1 Dover Corporation Press Release dated January 27, 2015.
99.2 Presentation Slides posted on Dover Corporation’s website at http://www.dovercorporation.com.





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:
January 27, 2015
DOVER CORPORATION
 
 
 
(Registrant)
 
 
 
 
 
 
 
 
By:
/s/ Ivonne M. Cabrera
 
 
 
 
Ivonne M. Cabrera
 
 
 
 
Senior Vice President, General Counsel & Secretary
 
 
 
 
 
 







EXHIBIT INDEX
Number
 
Exhibit
99.1
 
Press Release of Dover Corporation dated January 27, 2015
 
 
 
99.2
 
Presentation Slides posted on Dover Corporation’s website at http://www.dovercorporation.com



2015.01.27 8-K Exhibit 99.1


Exhibit 99.1

CONTACT:
 
 
Paul Goldberg
 
 
Vice President - Investor Relations
 
 
(212) 922-1640
 
 

DOVER REPORTS FOURTH QUARTER AND FULL YEAR 2014 RESULTS
AND UPDATES 2015 GUIDANCE

•
Reports quarterly revenue of $2.0 billion, an increase of 11% over the prior year
•
Achieves adjusted quarterly diluted earnings per share from continuing operations of $1.01, excluding discrete tax benefits; this result includes $0.17 in restructuring and other costs
•
Plans to divest two businesses, which are now reported as discontinued operations
•
Updates guidance for 2015 full year diluted earnings per share from continuing operations to be in the range of $4.70 to $4.95, a reduction to prior guidance reflecting the combined impact of global energy markets and discontinued operations, net of share repurchase activity

Downers Grove, Illinois, January 27, 2015 — Dover (NYSE: DOV) announced today that for the fourth quarter ended December 31, 2014, revenue was $2.0 billion, an increase of 11% over the prior year. The revenue increase was driven by organic growth of 6% and an increase of 7% from acquisitions, partially offset by a 2% impact from foreign exchange. Earnings from continuing operations were $171.8 million, essentially flat compared to $172.2 million for the prior year period. Diluted earnings per share ("EPS") for the fourth quarter ended December 31, 2014 was $1.03, compared to $1.00 EPS in the prior year period, representing an increase of 3%. EPS from continuing operations for the fourth quarter of 2014 included discrete tax benefits of $0.02, compared to $0.01 EPS in the prior year period. Excluding these items, adjusted EPS from continuing operations for the fourth quarter of 2014 was $1.01, an increase of 2% over an adjusted EPS of $0.99 in the prior year period.

Revenue for the year ended December 31, 2014 was $7.8 billion, an increase of 8% over the prior year, reflecting organic growth of 4% and a 4% increase from acquisitions. Foreign exchange had a negligible impact. Earnings from continuing operations for the year ended December 31, 2014 were $778.1 million, compared to $797.5 million in the prior year period, representing a decrease of 2%. EPS for the year ended December 31, 2014 was $4.61 EPS, essentially flat compared to $4.60 EPS in the prior year. EPS from continuing operations during this period includes discrete tax benefits of $0.07 EPS compared to $0.43 EPS in the prior year, as well as $0.02 of other one-time gains recognized in the prior year. Excluding these items, adjusted EPS from continuing operations for the year ended December 31, 2014 was $4.54, an increase of 10% over an adjusted EPS of $4.14 in the prior year.

Dover also announced today its intention to divest Sargent Aerospace (“Sargent”), a supplier of precision-engineered components and aftermarket services in the aerospace and defense industries, and part of Dover’s Engineered Systems segment. Both Sargent and Datamax O’Neil (“D-O”) are reported as discontinued operations for the fourth quarter and full year 2014 results.




Dover expects to complete the sale of D-O in the first quarter, with the sale of Sargent expected to occur in the second quarter of 2015.

Commenting on the fourth quarter results, Dover's President and Chief Executive Officer, Robert A. Livingston, said, “We finished the year with a very strong fourth quarter, achieving 11% revenue growth and earnings growth that exceeded expectations. We saw robust topline growth at each segment led by Energy and Fluids at 20% and 10%, respectively, and achieved solid volume leverage. In the quarter, we made the decision to divest Sargent and, as previously announced, Datamax O’Neil. While both are excellent companies with strong positions, they serve markets where others have greater scale. We expect after-tax proceeds of the divestitures to be used for share repurchases and growth opportunities."

“As previously announced, we took decisive actions in the quarter to adjust our costs and streamline our businesses, which accounted for the majority of nonrecurring charges of $0.17. Regarding our energy markets, there continues to be significant uncertainty driven by the rapid decline in oil prices. Accordingly, we took additional cost reduction steps in our Energy businesses during the quarter and continue to review further actions, including additional restructuring costs in the first quarter of 2015."

"As a result, we are updating our 2015 guidance to reflect the anticipated combined impact of lower oil prices, discontinued operations, share repurchase activity and FX. We now expect total revenue growth of 1% to -2%, principally reflecting our new Energy revenue estimate of -6% to -9%, a 15 point reduction from our prior forecast. Within our total revenue forecast, organic growth is anticipated to be approximately 1% to -2%, completed acquisitions will provide approximately 2% growth and FX is expected to be a 2% headwind. In total, we now expect full year adjusted EPS to be in the range of $4.70 to $4.95, a $0.35 reduction to our prior guidance.”

Net earnings for the quarter ended December 31, 2014, were $169.3 million, or $1.02 EPS, which included a loss from discontinued operations of $2.5 million, or $0.02 EPS compared to net earnings of $194.0 million, or $1.13 EPS, for the same period of 2013, which included earnings from discontinued operations of $21.7 million, or $0.13 EPS.

Net earnings for the year ended December 31, 2014 were $775.2 million, or $4.59 EPS, compared to net earnings of $1.0 billion, or $5.78 EPS, for the same period of 2013. 2014 results reflected a loss from discontinued operations of $2.9 million, or $0.02 EPS, which included $27.1 million in spin-off costs. 2013 results reflected earnings from discontinued operations of $205.6 million or $1.18 EPS, which included spin-off costs of $30.1 million.

Dover will host a webcast of its fourth quarter 2014 conference call at 10:00 A.M. Eastern Time (9:00 A.M. Central Time) on Tuesday, January 27, 2015. The webcast can be accessed on the Dover website at www.dovercorporation.com. The conference call will also be made available for replay on the website. Additional information on Dover’s fourth quarter results and its operating segments can also be found on the Company’s website.

About Dover:

Dover is a diversified global manufacturer with annual revenues of $8 billion. We deliver innovative equipment and components, specialty systems and support services through four major operating segments: Energy, Engineered Systems, Fluids, and Refrigeration & Food Equipment. Dover combines global scale with operational agility to lead the markets we serve.  Recognized for our entrepreneurial approach for nearly 60 years, our team of 27,000 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 www.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. Such statements relate to, among other things, operating and strategic plans, income, earnings, cash flows, changes in operations, industries in which Dover businesses operate, and operating improvements. Forward-looking statements may be indicated by words or phrases such as “anticipates,” “expects,” “believes,” “suggests,” “will,” “plans,” “should,” “would,” “could,” and “forecast”, or the use of the future tense and similar words or phrases. Forward-looking statements are subject to inherent risks and uncertainties that could cause actual results to differ materially from current expectations, including, but not limited to, oil and natural gas demand, production growth, and prices; changes in exploration and production spending by Dover’s customers and changes in the level of oil and natural gas exploration and development; economic conditions generally and changes in economic conditions globally and in markets served by Dover businesses, including well activity, U.S. industrials activity and the status of economic recovery in Europe; the ability of Dover's businesses to expand into new geographic markets; Dover's ability to identify and successfully consummate value-adding acquisition opportunities or planned divestitures; Dover's ability to achieve expected savings from integration and other cost-control initiatives, such as lean and productivity programs; changes in customer demand or the impact of loss of a significant customer, or loss or non-renewal of significant contracts; the ability of Dover's businesses to develop and launch new products, timing of such launches and risks relating to market acceptance by customers; the relative mix of products and services which impacts margins and operating efficiencies; increased competition and pricing pressures; the impact of loss of a single-source manufacturing facility; short-term capacity constraints; increases in the cost of raw materials; domestic and foreign governmental and public policy changes or developments, including environmental regulations, conflict minerals disclosure requirements, and tax policies; protection and validity of patent and other intellectual property rights; the impact of legal matters and legal compliance risks; the impact of interest rate and currency exchange rate fluctuations; conditions and events affecting domestic and global financial and capital markets; and a downgrade in Dover's credit ratings which, among other matters, could make obtaining financing more difficult and costly. Dover 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, for a discussion of these and other risks and uncertainties that could cause its actual results to differ materially from its current expectations and from the forward-looking statements contained herein. Dover undertakes no obligation to update any forward-looking statement, except as required by law.








INVESTOR SUPPLEMENT - FOURTH QUARTER AND FULL YEAR 2014

DOVER CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
(unaudited)(in thousands, except per share data)
 
Three Months Ended December 31,
 
Years Ended December 31,
 
2014
 
2013
 
2014
 
2013
Revenue
$
1,977,947

 
$
1,785,922

 
$
7,752,728

 
$
7,155,096

Cost of goods and services
1,254,079

 
1,106,213

 
4,778,479

 
4,376,505

Gross profit
723,868

 
679,709

 
2,974,249

 
2,778,591

Selling and administrative expenses
460,377

 
412,487

 
1,758,765

 
1,616,921

Operating earnings
263,491

 
267,222

 
1,215,484

 
1,161,670

Interest expense, net
31,332

 
29,912

 
127,179

 
120,654

Other expense (income), net
1,172

 
(3,500
)
 
(5,902
)
 
(4,970
)
Earnings before provision for income taxes and discontinued operations
230,987

 
240,810

 
1,094,207

 
1,045,986

Provision for income taxes
59,152

 
68,583

 
316,067

 
248,459

Earnings from continuing operations
171,835

 
172,227

 
778,140

 
797,527

(Loss) earnings from discontinued operations, net
(2,541
)
 
21,736

 
(2,905
)
 
205,602

Net earnings
$
169,294

 
$
193,963

 
$
775,235

 
$
1,003,129

 
 
 
 
 
 
 
 
Basic earnings per common share:
 
 
 
 
 
 
 
Earnings from continuing operations
$
1.04

 
$
1.01

 
$
4.67

 
$
4.66

(Loss) earnings from discontinued operations, net
(0.02
)
 
0.13

 
(0.02
)
 
1.20

Net earnings
1.03

 
1.14

 
4.65

 
5.86

 
 
 
 
 
 
 
 
Weighted average shares outstanding
164,589
 
170,027
 
166,692
 
171,271
 
 
 
 
 
 
 
 
Diluted earnings per common share:
 
 
 
 
 
 
 
Earnings from continuing operations
$
1.03

 
$
1.00

 
$
4.61

 
$
4.60

(Loss) earnings from discontinued operations, net
(0.02
)
 
0.13

 
(0.02
)
 
1.18

Net earnings
1.02

 
1.13

 
4.59

 
5.78

 
 
 
 
 
 
 
 
Weighted average shares outstanding
166,467
 
172,265
 
168,842
 
173,547
 
 
 
 
 
 
 
 
Dividends paid per common share
$
0.40

 
$
0.375

 
$
1.55

 
$
1.45

 
 
 
 
 
 
 
 





DOVER CORPORATION
QUARTERLY SEGMENT INFORMATION
(unaudited)(in thousands)
 
2014
 
2013
 
Q1
Q2
Q3
Q4
FY 2014
 
Q1
Q2
Q3
Q4
FY 2013
REVENUE
 
 
 
 
 
 
 
 
 
 
 
Energy
$
478,773

$
481,016

$
507,334

$
550,116

$
2,017,239

 
$
462,679

$
465,906

$
467,688

$
457,580

$
1,853,853

 
 
 
 
 
 
 
 
 
 
 
 
Engineered Systems
 
 
 
 
 
 
 
 
 
 
 
Printing & Identification
231,679

252,354

257,282

247,569

988,884

 
205,828

213,573

220,538

237,936

877,875

Industrials
335,995

361,467

355,019

344,600

1,397,081

 
317,059

330,423

332,095

320,518

1,300,095

 
567,674

613,821

612,301

592,169

2,385,965

 
522,887

543,996

552,633

558,454

2,177,970

 
 
 
 
 
 
 
 
 
 
 
 
Fluids
345,009

346,275

361,797

377,485

1,430,566

 
273,638

310,137

309,241

343,822

1,236,838

 
 
 
 
 
 
 
 
 
 
 
 
Refrigeration & Food Equipment
411,493

522,357

528,807

458,532

1,921,189

 
422,468

517,574

521,322

426,476

1,887,840

 
 
 
 
 
 
 
 
 
 
 
 
Intra-segment eliminations
(379
)
(833
)
(664
)
(355
)
(2,231
)
 
(132
)
(632
)
(231
)
(410
)
(1,405
)
Total consolidated revenue
$
1,802,570

$
1,962,636

$
2,009,575

$
1,977,947

$
7,752,728

 
$
1,681,540

$
1,836,981

$
1,850,653

$
1,785,922

$
7,155,096

 
 
 
 
 
 
 
 
 
 
 
 
NET EARNINGS
 
 
 
 
 
 
 
 
 
 
 
Segment Earnings:
 
 
 
 
 
 
 
 
 
 
 
Energy
$
118,968

$
114,991

$
122,738

$
105,118

$
461,815

 
$
118,708

$
109,662

$
119,086

$
112,193

$
459,649

Engineered Systems
83,227

101,766

108,800

93,205

386,998

 
74,162

87,818

98,044

87,473

347,497

Fluids
57,942

63,112

67,559

63,026

251,639

 
47,601

58,768

63,056

55,098

224,523

Refrigeration & Food Equipment
44,862

84,926

78,012

30,934

238,734

 
52,110

82,177

86,446

46,574

267,307

Total Segments
304,999

364,795

377,109

292,283

1,339,186

 
292,581

338,425

366,632

301,338

1,298,976

Corporate expense / other
30,734

29,287

27,815

29,964

117,800

 
33,885

35,078

32,757

30,616

132,336

Net interest expense
32,655

31,961

31,231

31,332

127,179

 
30,282

30,230

30,230

29,912

120,654

Earnings from continuing operations before provision for income taxes
241,610

303,547

318,063

230,987

1,094,207

 
228,414

273,117

303,645

240,810

1,045,986

Provision for income taxes
71,569

92,966

92,380

59,152

316,067

 
68,147

25,129

86,600

68,583

248,459

Earnings from continuing operations
170,041

210,581

225,683

171,835

778,140

 
160,267

247,988

217,045

172,227

797,527

(Loss) earnings from discontinued operations, net
(9,903
)
3,378

6,161

(2,541
)
(2,905
)
 
49,736

82,061

52,069

21,736

205,602

Net earnings
$
160,138

$
213,959

$
231,844

$
169,294

$
775,235

 
$
210,003

$
330,049

$
269,114

$
193,963

$
1,003,129

 
 
 
 
 
 
 
 
 
 
 
 
SEGMENT OPERATING MARGIN
 
 
 
 
 
 
 
 
 
Energy
24.8
%
23.9
%
24.2
%
19.1
%
22.9
%
 
25.7
%
23.5
%
25.5
%
24.5
%
24.8
%
Engineered Systems
14.7
%
16.6
%
17.8
%
15.7
%
16.2
%
 
14.2
%
16.1
%
17.7
%
15.7
%
16.0
%
Fluids
16.8
%
18.2
%
18.7
%
16.7
%
17.6
%
 
17.4
%
18.9
%
20.4
%
16.0
%
18.2
%
Refrigeration & Food Equipment
10.9
%
16.3
%
14.8
%
6.7
%
12.4
%
 
12.3
%
15.9
%
16.6
%
10.9
%
14.2
%
Total Segment
16.9
%
18.6
%
18.8
%
14.8
%
17.3
%
 
17.4
%
18.4
%
19.8
%
16.9
%
18.2
%
 
 
 
 
 
 
 
 
 
 
 
 
DEPRECIATION AND AMORTIZATION EXPENSE
 
 
 
 
 
 
 
 
 
Energy
$
25,575

$
25,807

$
27,145

$
33,429

$
111,956

 
$
24,448

$
24,714

$
24,707

$
25,206

$
99,075

Engineered Systems
15,850

15,982

15,334

14,780

61,946

 
14,309

14,774

14,950

15,025

59,058

Fluids
16,366

15,308

14,019

15,210

60,903

 
11,361

11,570

11,790

14,091

48,812

Refrigeration & Food Equipment
17,212

17,451

17,073

16,965

68,701

 
16,585

16,611

16,962

17,070

67,228

Corporate
870

1,000

910

902

3,682

 
859

1,028

1,030

943

3,860

 
$
75,873

$
75,548

$
74,481

$
81,286

$
307,188

 
$
67,562

$
68,697

$
69,439

$
72,335

$
278,033

 
 
 
 
 
 
 
 
 
 
 
 




DOVER CORPORATION
QUARTERLY SEGMENT INFORMATION
(continued)
(unaudited)(in thousands)
 
2014
 
2013
 
Q1
Q2
Q3
Q4
FY 2014
 
Q1
Q2
Q3
Q4
FY 2013
BOOKINGS
 
 
 
 
 
 
 
 
 
 
 
Energy
$
478,469

$
477,162

$
526,134

$
534,646

$
2,016,411

 
$
515,388

$
416,892

$
481,021

$
440,261

$
1,853,562

 
 
 
 
 
 
 
 
 
 
 
 
Engineered Systems
 
 
 
 
 
 
 
 
 
 
 
Printing & Identification
250,434

245,445

249,299

248,082

993,260

 
205,386

221,458

219,316

233,308

879,468

Industrials
370,949

363,773

342,687

374,438

1,451,847

 
346,539

343,194

300,655

325,840

1,316,228

Eliminations
(18
)
(16
)
(11
)
(11
)
(56
)
 
(81
)
(129
)
(5
)
278

63

 
621,365

609,202

591,975

622,509

2,445,051

 
551,844

564,523

519,966

559,426

2,195,759

 
 
 
 
 
 
 
 
 
 
 
 
Fluids
362,943

375,009

350,853

345,553

1,434,358

 
303,609

298,817

307,729

351,767

1,261,922

 
 
 
 
 
 
 
 
 
 
 
 
Refrigeration & Food Equipment
493,731

542,810

459,099

367,567

1,863,207

 
482,792

515,270

433,426

450,850

1,882,338

 
 
 
 
 
 
 
 
 
 
 
 
Intra-segment eliminations
(506
)
(1,089
)
(737
)
(644
)
(2,976
)
 
(560
)
(708
)
(417
)
735

(950
)
 
 
 
 
 
 
 
 
 
 
 
 
Total consolidated bookings
$
1,956,002

$
2,003,094

$
1,927,324

$
1,869,631

$
7,756,051

 
$
1,853,073

$
1,794,794

$
1,741,725

$
1,803,039

$
7,192,631

 
 
 
 
 
 
 
 
 
 
 
 
BACKLOG
 
 
 
 
 
 
 
 
 
 
 
Energy
$
210,846

$
206,415

$
232,739

$
233,347

 
 
$
274,733

$
218,764

$
233,820

$
206,790

 
 
 
 
 
 
 
 
 
 
 
 
 
Engineered Systems
 
 
 
 
 
 
 
 
 
 
 
Printing & Identification
131,298

128,912

115,352

110,359

 
 
91,020

98,624

99,615

95,597

 
Industrials
266,517

268,680

254,612

282,598

 
 
250,480

261,600

228,605

231,748

 
 
397,815

397,592

369,964

392,957

 
 
341,500

360,224

328,220

327,345

 
 
 
 
 
 
 
 
 
 
 
 
 
Fluids
328,617

348,508

323,424

277,834

 
 
222,255

228,212

228,880

310,330

 
 
 
 
 
 
 
 
 
 
 
 
 
Refrigeration & Food Equipment
431,298

450,065

376,141

282,507

 
 
417,246

412,366

324,042

347,004

 
 
 
 
 
 
 
 
 
 
 
 
 
Intra-segment eliminations
(374
)
(211
)
(302
)
(431
)
 
 
(596
)
(526
)
(387
)
(592
)
 
 
 
 
 
 
 
 
 
 
 
 
 
Total consolidated backlog
$
1,368,202

$
1,402,369

$
1,301,966

$
1,186,214

 
 
$
1,255,138

$
1,219,040

$
1,114,575

$
1,190,877

 






DOVER CORPORATION
QUARTERLY EARNINGS PER SHARE
(unaudited)(in thousands, except per share data*)
 
2014
 
2013
 
Q1
Q2
Q3
Q4
FY 2014
 
Q1
Q2
Q3
Q4
FY 2013
Basic earnings (loss) per common share:
 
 
 
 
 
 
 
 
 
Continuing operations
$
1.00

$
1.26

$
1.36

$
1.04

$
4.67

 
$
0.92

$
1.45

$
1.27

$
1.01

$
4.66

Discontinued operations
(0.06
)
0.02

0.04

(0.02
)
(0.02
)
 
0.29

0.48

0.31

0.13

1.20

Net earnings
0.94

1.29

1.40

1.03

4.65

 
1.21

1.93

1.58

1.14

5.86

 
 
 
 
 
 
 
 
 
 
 
 
Diluted earnings (loss) per common share:
 
 
 
 
 
 
 
 
 
Continuing operations
$
0.99

$
1.25

$
1.34

$
1.03

$
4.61

 
$
0.91

$
1.43

$
1.26

$
1.00

$
4.60

Discontinued operations
(0.06
)
0.02

0.04

(0.02
)
(0.02
)
 
0.28

0.47

0.30

0.13

1.18

Net earnings
0.93

1.27

1.38

1.02

4.59

 
1.20

1.91

1.56

1.13

5.78

 
 
 
 
 
 
 
 
 
 
 
 
Adjusted diluted earnings per common share (calculated below):
Continuing operations
$
0.97

$
1.25

$
1.31

$
1.01

$
4.54

 
$
0.89

$
1.08

$
1.20

$
0.99

$
4.14

 
 
 
 
 
 
 
 
 
 
 
 
Net earnings (loss) and average shares used in calculated earnings (loss) per share amounts are as follows:
 
 
 
 
 
 
 
 
 
 
 
 
Net earnings (loss):
 
 
 
 
 
 
 
 
 
 
 
Continuing operations
$
170,041

$
210,581

$
225,683

$
171,835

$
778,140

 
$
160,267

$
247,988

$
217,045

$
172,227

$
797,527

Discontinued operations
(9,903
)
3,378

6,161

(2,541
)
(2,905
)
 
49,736

82,061

52,069

21,736

205,602

Net earnings
160,138

213,959

231,844

169,294

775,235

 
210,003

330,049

269,114

193,963

1,003,129

 
 
 
 
 
 
 
 
 
 
 
 
Average shares outstanding:
 
 
 
 
 
 
 
 
 
Basic
169,750

166,474

166,021

164,589

166,692

 
173,448

171,111

170,544

170,027

171,271

Diluted
172,013

168,857

168,343

166,467

168,842

 
175,567

173,097

172,734

172,265

173,547

Note:
 
 
 
 
 
 
 
 
 
 
 
Earnings from continuing operations are adjusted by discrete tax items and other one-time gains to derive adjusted earnings from continuing operations and adjusted diluted earnings per common share as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
2014
 
2013
 
Q1
Q2
Q3
Q4
FY 2014
 
Q1
Q2
Q3
Q4
FY 2013
Adjusted earnings from continuing operations:
 
 
 
 
 
 
 
 
Earnings from continuing operations
$
170,041

$
210,581

$
225,683

$
171,835

$
778,140

 
$
160,267

$
247,988

$
217,045

$
172,227

$
797,527

Gains (losses) from discrete and other tax items
2,541

(635
)
5,524

3,860

11,290

 
3,893

61,477

7,751

2,338

75,459

Other one-time gains, net of tax (1)
—

—

—

—

—

 
—

—

2,866

—

2,866

Adjusted earnings from continuing operations
$
167,500

$
211,216

$
220,159

$
167,975

$
766,850

 
$
156,374

$
186,511

$
206,428

$
169,889

$
719,202

 
 
 
 
 
 
 
 
 
 
 
 
Adjusted diluted earnings per common share:
 
 
 
 
 
 
 
 
 
Earnings from continuing operations
$
0.99

$
1.25

$
1.34

$
1.03

$
4.61

 
$
0.91

$
1.43

$
1.26

$
1.00

$
4.60

Gains from discrete and other tax items
0.01

—

0.03

0.02

0.07

 
0.02

0.36

0.04

0.01

0.43

Other one-time gains, net of tax (1)
—

—

—

—

—

 
—

—

0.02

—

0.02

Adjusted earnings from continuing operations
$
0.97

$
1.25

$
1.31

$
1.01

$
4.54

 
$
0.89

$
1.08

$
1.20

$
0.99

$
4.14

 
 
 
 
 
 
 
 
 
 
 
 
(1) Reflects a one-time curtailment gain recognized in the third quarter of 2013 in connection with the freeze of the Company's defined benefit pension plans.
 
 
 
 
 
 
 
 
 
 
 
 
* Per share data may not add due to rounding.
 
 
 
 
 
 
 
 




DOVER CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(unaudited)(in thousands)

 
December 31, 2014
 
December 31, 2013
Assets:
 
 
 
Cash and cash equivalents
$
681,581

 
$
803,882

Receivables, net of allowances
1,186,746

 
1,076,641

Inventories, net
863,737

 
715,311

Deferred tax and other current assets
164,758

 
122,138

Property, plant and equipment, net
837,069

 
787,849

Goodwill
3,491,557

 
3,032,991

Intangible assets, net
1,369,520

 
1,258,911

Other assets
168,246

 
202,806

Assets of discontinued operations
327,171

 
2,854,652

Total assets
$
9,090,385

 
$
10,855,181

 
 
 
 
Liabilities and Stockholders' Equity:
 
 
 
Notes payable and current maturities of long-term debt
$
777,956

 
$
229,278

Payables and accrued expenses
1,261,398

 
1,112,863

Deferred taxes and other non-current liabilities
1,046,547

 
975,823

Long-term debt
2,253,041

 
2,599,201

Liabilities of discontinued operations
50,718

 
560,620

Stockholders' equity
3,700,725

 
5,377,396

Total liabilities and stockholders' equity
$
9,090,385

 
$
10,855,181






DOVER CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)(in thousands)

 
Years Ended December 31,
 
2014
 
2013
Operating activities:
 
 
 
Net earnings
$
775,235

 
$
1,003,129

Loss (earnings) from discontinued operations, net
2,905

 
(205,602
)
Depreciation and amortization
307,188

 
278,033

Stock-based compensation
31,628

 
30,480

Contributions to employee benefit plans
(24,232
)
 
(40,258
)
Net change in assets and liabilities
(139,908
)
 
(86,170
)
Net cash provided by operating activities of continuing operations
952,816

 
979,612

 
 
 
 
Investing activities:
 
 
 
Additions to property, plant and equipment
(166,033
)
 
(141,694
)
Acquisitions (net of cash and cash equivalents acquired)
(802,254
)
 
(322,838
)
Proceeds from the sale of businesses
191,348

 
76,457

Other
(5,618
)
 
26,398

Net cash used in investing activities of continuing operations
(782,557
)
 
(361,677
)
 
 
 
 
Financing activities:
 
 
 
Cash received from Knowles Corporation, net of cash distributed
359,955

 
—

Net increase in debt and notes payable
244,934

 
19,530

Dividends to stockholders
(258,487
)
 
(247,820
)
Purchase of common stock
(601,077
)
 
(457,871
)
Net proceeds from exercise of share-based awards
(814
)
 
7,619

Net cash used in financing activities of continuing operations
(255,489
)
 
(678,542
)
 
 
 
 
Net cash provided by discontinued operations
3,355

 
65,764

 
 
 
 
Effect of exchange rate changes on cash
(40,426
)
 
(1,351
)
 
 
 
 
Net (decrease) increase in cash and cash equivalents
(122,301
)
 
3,806

Cash and cash equivalents at beginning of period
803,882

 
800,076

Cash and cash equivalents at end of period
$
681,581

 
$
803,882






DOVER CORPORATION
ADDITIONAL QUARTERLY INFORMATION
(unaudited)(in thousands, except per share data*)

FREE CASH FLOW
 
2014
 
2013
 
Q1
Q2
Q3
Q4
FY 2014
 
Q1
Q2
Q3
Q4
FY 2013
Cash flow from operating activities
$
28,361

$
185,013

$
292,012

$
447,430

$
952,816

 
$
58,222

$
241,881

$
261,659

$
417,850

$
979,612

Less: Additions to property, plant and equipment
(32,695
)
(42,550
)
(33,532
)
(57,256
)
(166,033
)
 
(25,082
)
(30,561
)
(39,191
)
(46,860
)
(141,694
)
Free cash flow
$
(4,334
)
$
142,463

$
258,480

$
390,174

$
786,783

 
$
33,140

$
211,320

$
222,468

$
370,990

$
837,918

 
 
 
 
 
 
 
 
 
 
 
 
Free cash flow as a percentage of earnings from continuing operations
(2.5
)%
67.7
%
114.5
%
227.1
%
101.1
%
 
20.7
%
85.2
%
102.5
%
215.4
%
105.1
%
 
 
 
 
 
 
 
 
 
 
 
 
Free cash flow as a percentage of revenue
(0.2
)%
7.3
%
12.9
%
19.7
%
10.1
%
 
2.0
%
11.5
%
12.0
%
20.8
%
11.7
%


RESULTS OF SARGENT AEROSPACE AND DATAMAX O'NEIL

The following tables present the impact the operating results of Sargent Aerospace ("Sargent") and Datamax O'Neil ("D-O") had on the consolidated results of Dover Corporation. Sargent and D-O have been included in the consolidated financial statements as discontinued operations for all periods presented. See "Discontinued Operations" in this Investor Supplement for a discussion of the results and components of discontinued operations.
 
2014
 
2013
 
Q1
Q2
Q3
Q4
FY 2014
 
Q1
Q2
Q3
Q4
FY 2013
Revenue:
 
 
 
 
 
 
 
 
 
 
 
Revenue including Sargent and D-O
$
1,884,647

$
2,047,738

$
2,092,467

$
2,056,063

$
8,080,915

 
$
1,763,977

$
1,932,411

$
1,940,211

$
1,879,054

$
7,515,653

Revenue of Sargent and D-O
82,077

85,102

82,892

78,116

328,187

 
82,437

95,430

89,558

93,132

360,557

Continuing revenue as reported
$
1,802,570

$
1,962,636

$
2,009,575

$
1,977,947

$
7,752,728

 
$
1,681,540

$
1,836,981

$
1,850,653

$
1,785,922

$
7,155,096

 
 
 
 
 
 
 
 
 
 
 
 
Earnings:
 
 
 
 
 
 
 
 
 
 
 
Earnings including Sargent and D-O
$
176,324

$
217,443

$
232,825

$
177,837

$
804,429

 
$
167,213

$
258,058

$
226,235

$
182,566

$
834,072

Earnings attributable to Sargent and D-O
6,283

6,862

7,142

6,002

26,289

 
6,946

10,070

9,190

10,339

36,545

Earnings from continuing operations as reported
$
170,041

$
210,581

$
225,683

$
171,835

$
778,140

 
$
160,267

$
247,988

$
217,045

$
172,227

$
797,527

 
 
 
 
 
 
 
 
 
 
 
 
Diluted earnings per common share:
 
 
 
 
 
 
 
 
 
 
Earnings including Sargent and D-O
$
1.02

$
1.29

$
1.38

$
1.07

$
4.76

 
$
0.95

$
1.49

$
1.31

$
1.06

$
4.81

Earnings attributable to Sargent and D-O
0.04

0.04

0.04

0.04

0.16

 
0.04

0.06

0.05

0.06

0.21

Earnings from continuing operations as reported
$
0.99

$
1.25

$
1.34

$
1.03

$
4.61

 
$
0.91

$
1.43

$
1.26

$
1.00

$
4.60

 
 
 
 
 
 
 
 
 
 
 
 
* Per share data may not add due to rounding.





ADDITIONAL INFORMATION
FOURTH QUARTER AND FULL YEAR 2014

Acquisitions

During the fourth quarter of 2014, the Company completed one acquisition within the Energy segment. For the full year 2014, Dover made a total of seven acquisitions for consideration totaling $802.3 million.

Discontinued Operations

The Company did not dispose of any businesses in the fourth quarter of 2014; however, in the fourth quarter, the Company announced its intent to divest Datamax O'Neil and Sargent Aerospace, two non-core businesses within the Engineered Systems segment. The results of operations and cash flows of these businesses have been reclassified to discontinued operations and the assets and liabilities of these businesses have been segregated within assets and liabilities of discontinued operations for all periods presented herein. For the fourth quarter of 2014, the Company recognized a loss from discontinued operations of $2.5 million, or $0.02 EPS, which includes $6.0 million of earnings, or $0.04 EPS, of the aforementioned businesses.

On a full-year basis, the Company generated a net loss of $2.9 million, or $0.02 EPS. Included in this amount is a $6.9 million loss on sale of DEK International, which was sold in the third quarter of 2014 and a $3.2 million gain to adjust the gain on sale of Everett Charles Technologies, which was sold in the fourth quarter of 2013. Also included in the results of discontinued operations is $26.3 million of earnings, or $0.16 EPS, attributable to the operations of Datamax O'Neil and Sargent Aerospace. Earnings from discontinued operations also include the results of Knowles Corporation, prior to the distribution on February 28, 2014, as well as the related spin-off costs incurred by Dover during the period, which totaled a loss of approximately $21.8 million, or $0.13 EPS.

Restructuring and Other Costs

During the quarter, the Company took actions to adjust our costs and streamline our businesses, resulting in $37.4 million, or $0.16 EPS, of restructuring charges. These charges were incurred at each of our business segments, including $5.8 million in Energy, $3.7 million in Engineered Systems, $2.8 million in Fluids, and $24.9 million in Refrigeration & Food Equipment. The Company expects to record an additional $17 to $20 million in restructuring charges in the first quarter of 2015, with the majority of these charges in the Energy segment. The Company also recorded a $3.6 million, or $0.01 EPS, pension settlement charge in the fourth quarter of 2014.

Tax Rate

The effective tax rate on continuing operations was 25.6% and 28.5% for the fourth quarters of 2014 and 2013, respectively. On a full year basis, the effective tax rates on continuing operations for 2014 and 2013 were 28.9% and 23.8%, respectively. The 2014 and 2013 rates were favorably impacted by discrete and other items, as shown in the reconciliation for quarterly earnings per share included herein. After adjusting for discrete and other items, the fourth quarter effective tax rates were 27.3% and 29.5% for 2014 and 2013, respectively, and the full year rates were 29.9% and 31.0% for 2014 and 2013, respectively. The lower rates for the quarter and full year primarily reflect the tax benefits associated with restructuring charges and lower rates in foreign jurisdictions. The fourth quarter rate was also favorably impacted by the extension of the R&D credit.

Revenue Growth Factors
 
2014
 
Q1
 
Q2
 
Q3
 
Q4
 
Full Year
Organic
4
%
 
4
%
 
5
%
 
6
 %
 
4
%
Acquisitions
3
%
 
3
%
 
4
%
 
7
 %
 
4
%
Currency translation
—
%
 
—
%
 
—
%
 
(2
)%
 
—
%
 
7
%
 
7
%
 
9
%
 
11
 %
 
8
%





Free Cash Flow

The following table is a reconciliation of free cash flow (a non-GAAP measure) from cash flow provided by operating activities:
 
Three Months Ended December 31,
 
Years Ended December 31,
 
2014
 
2013
 
2014
 
2013
Free Cash Flow (dollars in thousands)
 
 
 
 
 
 
 
Cash flow provided by operating activities
$
447,430

 
$
417,850

 
$
952,816

 
$
979,612

Less: Capital expenditures
(57,256
)
 
(46,860
)
 
(166,033
)
 
(141,694
)
Free cash flow
$
390,174

 
$
370,990

 
$
786,783

 
$
837,918

 
 
 
 
 
 
 
 
Free cash flow as a percentage of revenue
19.7
%
 
20.8
%
 
10.1
%
 
11.7
%
 
 
 
 
 
 
 
 
Free cash flow as a percentage of earnings from continuing operations
 
 
 
 
101.1
%
 
105.1
%

The full year decrease in 2014 free cash flow reflects a higher investment in working capital year over year, higher capital expenditures, and lower earnings from continuing operations.

Share Repurchases

During the year ended December 31, 2014, the Company purchased a total of approximately 7.5 million shares of its common stock in the open market at a total cost of $601.1 million, or $80.50 per share. The Company completed its November 2012 $1.0 billion stock repurchase program in 2014 through the repurchase of 3.6 million shares. The remaining 3.9 million of share repurchases in 2014 were made pursuant to the share repurchase program approved in May 2012. As of December 31, 2014, the approximate number of shares still available for repurchase under the May 2012 share repurchase authorization was 38,041.

Capitalization

The following table provides a summary reconciliation of total debt and net debt to net capitalization to the most directly comparable GAAP measures:

Net Debt to Net Capitalization Ratio (in thousands)
 
December 31, 2014
 
December 31, 2013
Current maturities of long-term debt
 
$
299,956

 
$
2,778

Commercial paper
 
478,000

 
226,500

Long-term debt
 
2,253,041

 
2,599,201

Total debt
 
3,030,997

 
2,828,479

Less: Cash and cash equivalents
 
(681,581
)
 
(803,882
)
Net debt
 
2,349,416

 
2,024,597

Add: Stockholders' equity
 
3,700,725

 
5,377,396

Net capitalization
 
$
6,050,141

 
$
7,401,993

Net debt to net capitalization
 
38.8
%
 
27.4
%

Non-GAAP Information:

These Investor Supplement tables contain non-GAAP measures such as revenue including Sargent Aerospace and Datamax O'Neil and earnings including Sargent Aerospace and Datamax O'Neil, which is used in calculating earnings per share attributable to Sargent Aerospace and Datamax O'Neil. These tables also contain non-GAAP measures of adjusted earnings from continuing operations used in calculating adjusted diluted earnings per common share. Management believes this information is useful to investors to better understand the company’s ongoing profitability and facilitates easier comparisons of the company’s profitability to prior and future periods and to its peers. The company has also disclosed herein a number of non-GAAP measures related to free cash flow and the ratio of net debt to net capitalization. Management believes these metrics are important measures of the company's operating performance and liquidity. Free cash flow information provides both management and investors a measurement of cash generated from operations that is available to fund acquisitions, pay dividends, repay debt and repurchase common stock, while the net debt to net capitalization ratio is helpful in evaluating the company's capital structure and the amount of leverage employed.




a20150127exhibit992
Earnings Conference Call Fourth Quarter 2014 January 27, 2015 – 9:00am CT

 
2 Forward looking statements and non-GAAP measures We want to remind everyone that our comments may contain forward-looking statements that are inherently subject to uncertainties and risks. We caution everyone to be guided in their analysis of Dover Corporation by referring to the documents we file from time to time with the SEC, including our Form 10-K for 2013, for a list of factors that could cause our results to differ from those anticipated in any such forward-looking statements. We would also direct your attention to our website, www.dovercorporation.com, where considerably more information can be found. This document contains non-GAAP financial information. Reconciliations of non-GAAP measures are included either in this presentation or Dover’s earnings release and investor supplement for the fourth quarter and full year 2014. 2

 
3 $0.50 $0.70 $0.90 $1.10 $1.30 $1.50 Q1* Q2* Q3* Q4* Q1* Q2 Q3* Q4* Q4 2014 Performance Adjusted Earnings Per Share* (continuing operations) Q4 Q4/Q4 * Excludes discrete & other tax benefits of $0.02 in Q1 2013, $0.36 in Q2 2013, $0.04 in Q3 2013, $0.01 in Q4 2013, $0.01 in Q1 2014, $0.03 in Q3 2014 and $0.02 in Q4 2014; excludes other one-time gains of $0.02 in Q3 2013 (a) See Press Release for free cash flow reconciliation 3 Quarterly Comments 2013 2014  11% revenue growth is led by Energy & Fluids at 20% and 10%, respectively; organic revenue growth at each segment  United States, Europe and Asia markets were solid; Latin America remained weak  Segment margin of 14.8% was impacted by restructuring and normal purchase price accounting costs, adjusting for these costs margin was 17.3%  Bookings growth of 4% is led by Energy and Engineered Systems  Book-to-bill of 0.95 Revenue $2.0B 11% $7.8B 8% Adj. EPS (cont.) $1.01 2% $4.54 10% Bookings $1.9B 4% $7.8B 8% Seg. Margins 14.8% -210 bps 17.3% -90 bps Organic Rev. 6% 4% Acq. Growth 7% 4% FCF (a) $390M 5% $787M -6% FY14 FY14/FY13 Note: Q4 2014 includes restructuring and other costs of $0.17

 
4 Revenue Q4 2014 Energy Engineered Systems Fluids Refrigeration & Food Equip Total Organic 1% 5% 9% 8% 6% Acquisitions 20% 4% 3% 1% 7% Currency -1% -3% -2% -1% -2% Total 20% 6% 10% 8% 11% FY 2014 Energy Engineered Systems Fluids Refrigeration & Food Equip Total Organic 3% 6% 8% 2% 4% Acquisitions 7% 4% 8% - 4% Currency -1% -1% - - - Total 9% 9% 16% 2% 8%

 
5 Printing & ID Industrial $343 $374 $526 $535 $249 $248 $351 $346 $459 $368 $0 $200 $400 $600 $800 DE Q3 DE Q4 DES Q3 DES Q4 DF Q3 DF Q4 DRE Q3 DRE Q4 Sequential Results – Q3 2014 → Q4 2014 5 $355 $345 $507 $550 $257 $247 $362 $377 $529 $459 $0 $200 $400 $600 $800 DE Q3 DE Q4 DES Q3 DES Q4 DF Q3 DF Q4 DRE Q3 DRE Q4 Revenue +8% -20% -13% -2% +4% +5% -3% +2% Bookings

 
6 Energy  Strong revenue growth in Drilling & Production driven by recent acquisitions, the completion of U.S. shale projects and solid Middle East activity  Bearings & Compression results reflect solid compression end-markets  Lower oil prices will impact results going forward; restructuring charges in Q1 2015 expected to be $13M to $15M  Adjusted margin exceeded expectations at 22.5%  Bookings growth of 21% largely driven by recent acquisitions  Book-to-bill at 0.97 6 Q4 2014 Q4 2013 % Change Revenue $550 $458 20% Earnings $105 $112 -6% Margin 19.1% 24.5% -540 bps Adj. Earnings* $124 $112 11% Adj. Margin* 22.5% 24.5% -200 bps Bookings $535 $440 21% Revenue by End-Market % of Q4 Revenue Y / Y Growth Drilling & Production 73% 19% Bearings & Compression 16% 3% Automation 11% 72% $ in millions * Q4 2014 earnings adjusted for $6M in restructuring costs and $13M impact of purchase price accounting for Accelerated acquisition

 
7 Engineered Systems  Revenue growth is broad- based – Printing & Identification solid results driven by digital printing; partially offset by European softness – Industrial growth was broad-based, led by auto- related and waste handling businesses  Adjusted margin was solid at 16.4% driven by the benefits of productivity and volume  Broad-based bookings growth of 11%  Book-to-bill of 1.05 7 Q4 2014 Q4 2013 % Change Revenue $592 $558 6% Earnings $ 93 $ 87 7% Margin 15.7% 15.7% Flat Adj. Earnings* $ 97 $ 87 11% Adj. Margin* 16.4% 15.7% 70 bps Bookings $623 $559 11% Revenue by End-Market % of Q4 Revenue Y / Y Growth Printing & Identification 42% 4% Industrial 58% 8% $ in millions * Q4 2014 earnings adjusted for $4M in restructuring costs

 
8 Fluids  Revenue growth driven by strong demand in Fluid Transfer and improved pump volume – Fluid Transfer continues to benefit from increased safety and environmental regulations – Pumps results driven by chemical end-markets  Adjusted segment margin of 17.4% up on volume leverage  Bookings decline primarily related to the timing of project-related orders in Pumps  Book-to-bill at 0.92 8 Q4 2014 Q4 2013 % Change Revenue $377 $344 10% Earnings $ 63 $ 55 14% Margin 16.7% 16.0% 70 bps Adj. Earnings* $ 66 $ 55 20% Adj. Margin* 17.4% 16.0% 140 bps Bookings $346 $352 -2% Revenue by End-Market % of Q4 Revenue Y / Y Growth Pumps 45% 6% Fluid Transfer 55% 13% $ in millions * Q4 2014 earnings adjusted for $3M in restructuring costs

 
9 Refrigeration & Food Equipment  Revenue growth driven by strong performance in Refrigeration markets, supported by shipments of Q3 push-outs  Adjusted segment margin performance reflects improved performance and leverage on refrigeration volume, partially offset by product mix  Bookings impacted by the anticipated decline in refrigeration orders and the timing of food equipment orders  Book-to-bill at 0.80 9 Q4 2014 Q4 2013 % Change Revenue $459 $426 8% Earnings $ 31 $ 47 -34% Margin 6.7% 10.9% -420 bps Adj. Earnings* $ 56 $ 47 19% Adj. Margin* 12.2% 10.9% 130 bps Bookings $368 $451 -18% Revenue by End-Market % of Q4 Revenue Y / Y Growth Refrigeration 75% 11% Food Equipment 25% -1% $ in millions * Q4 2014 earnings adjusted for $25M in restructuring costs

 
10 Q4 2014 Overview 10 Q4 2014 Net Interest Expense $31 million, up $1 million from last year and in- line with expectations Corporate Expense $30 million, slightly down from last year, generally in-line with expectations; includes $3.6 million pension settlement Effective Tax Rate (ETR) Q4 rate was 27.3%, excluding $0.02 discrete tax benefit; lower than prior forecast due to R&D tax credit and tax benefits related to restructuring Capex $57 million, roughly in-line with expectations Share Repurchases Repurchased 2.7M shares ($208M) in quarter

 
11 Energy Update Oil & gas fundamentals have significantly declined since Dover Day Market Organic Growth Acq. Growth FX Impact Total Growth Organic Growth Acq. Growth FX Impact Total Growth Drilling and Prod. (5% - 2%) 8% - 11% (≈ 1%) 2% - 8% (19% - 17%) ≈ 7% (≈ 1%) (14% - 11%) Bearings and Comp. 2% - 4% - (≈ 1%) 1% - 3% 2% - 4% - (≈ 1%) 1% - 3% Automation 2% - 4% 17% - 19% - 18% - 22% (2%) - 3% 10% - 11% - 9% - 13% Total (3%) - 0% 8% - 10% (≈ 1%) 4% - 9% (14% - 11%) ≈ 6% (≈ 1%) (9% - 6%) Dover Day 2015 Forecast (12/8/14) Current 2015 Forecast

 
12 FY 2015 Guidance  Revenue – Organic revenue: 1% - (2%) – Completed acquisitions: ≈ 2% – FX impact: (2%) – Total revenue: 1% - (2%)  Corporate expense: ≈ $125 million  Interest expense: ≈ $130 million  Full-year tax rate: ≈ 30.0%  Capital expenditures: ≈ 2.3% of revenue  FY free cash flow: ≈ 11% of revenue 2015 Organic growth rate Energy (11% - 14%) Engineered Systems 3% - 5% Fluids 5% - 7% Refrigeration & Food Equipment ≈ 2% Total organic 1% - (2%) Acquisitions ≈ 2% (a) FX Impact (2%) Total growth 1% - (2%) (a) Reflects completed acquisitions as of 12/31/14

 
13 2015 EPS Guidance – Continuing Ops  2014 EPS – Continuing Ops (GAAP) $ 4.61 – Less 2014 tax items(1): (0.07)  2014 Adjusted EPS $ 4.54 – Net restructuring and one-time items(2): 0.09 - 0.10 – Performance including restructuring benefits: (0.06) - 0.10 – Acquisitions(3): (0.03 - 0.01) – Shares(4): 0.27 - 0.29 – Interest / Corp. / Tax rate / Other (net): (0.11 - 0.07)  2014 EPS – Continuing Ops $4.70 - $4.95 (1) $0.01 in Q1 2014 , $0.03 in Q3 2014 and $0.02 in Q4 2014 (3) Deals completed as of December 31, 2014, principally Accelerated (4) Based on 2015 estimated repurchases of $600M (2) Includes restructuring charges of $0.16 in Q4 2014 and $0.07 - $0.08 in Q1 2015, and pension settlement costs of $0.01 in Q4 2014

 

 
15  2013 EPS – GAAP Continuing Ops(1) $ 1.00 4.60 – Less 2013 tax benefits and other one-time gains (2): (0.01) (0.46)  2013 Adjusted EPS $ 0.99 $ 4.14 – Performance: 0.08 0.30 – Acquisitions(3): 0.00 0.01 – Corporate expenses: 0.01 0.05 – Interest / Shares / Tax rate (net): 0.10 0.21 – Q4 restructuring and other one-time items(4): (0.17) (0.17)  2014 Adjusted EPS Continuing Ops(5) $ 1.01 $ 4.54 – Add-back 2014 tax benefits and other one-time gains(6): 0.02 0.07  2014 EPS – GAAP Continuing Ops(7) $ 1.03 $ 4.61 2014 Adjusted EPS Reconciliation – Continuing Ops (1) Excludes the EPS impact of Datamax - O’Neil and Sargent which were classified as discontinued operations in Q4 2014; $0.06 in Q4 2013 and $0.21 for FY 2013 (2) $0.02 in Q1 2013 , $0.36 in Q2 2013, $0.06 in Q3 2013, $0.01 in Q4 2013 (3) Includes the impact of acquisitions closed in Q3 2014 and Q4 2014 (4) Includes restructuring charges of $0.16 and pension settlement costs of $0.01 in Q4 2014 FY 2014 Q4 2014 (7) Excludes the EPS impact of Datamax - O’Neil and Sargent which were classified as discontinued operations in Q4 2014; $0.04 in Q4 2014 and $0.16 for FY 2014 10% Growth Excluding Datamax O’Neil and Sargent, 2014 FY Adjusted EPS guidance was $4.39 - $4.46(7) (6) Includes discrete and other tax benefits of $0.01 in Q1 2014, $0.03 in Q3 2014 and $0.02 in Q4 2014 (5) Excludes discrete and other tax benefits of $0.01 in Q1 2014, $0.03 in Q3 2014 and $0.02 in Q4 2014