Dover Reports Fourth Quarter And Full Year 2015 Results And Reaffirms 2016 EPS Guidance

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Dover Reports Fourth Quarter And Full Year 2015 Results And Reaffirms 2016 EPS Guidance

- Reports quarterly revenue of $1.7 billion, a decrease of 14% from the prior year
- Delivers quarterly diluted earnings per share from continuing operations of $0.87, including $0.06 of discrete tax benefits
- Generates $274 million in free cash flow in the fourth quarter of 2015, and $795 million for the full year
- Adjusts full year 2016 revenue forecast to reflect weaker oil & gas markets; now expects full year organic revenue to decline 1% to 4%, one point lower than the previous forecast
- Reaffirms 2016 full year diluted earnings per share from continuing operations to be in the range of $3.85 to $4.05

DOWNERS GROVE, Ill., Jan. 26, 2016 /PRNewswire/ -- Dover (NYSE: DOV) announced today that for the fourth quarter ended December 31, 2015, revenue was $1.7 billion, a decrease of 14% from the prior year. The decrease in revenue was driven by an organic revenue decline of 12% and an unfavorable impact from foreign exchange of 4%, partially offset by 2% growth from acquisitions. Earnings from continuing operations were $136.6 million, a decrease of 21% as compared to $171.8 million for the prior year period. Diluted earnings per share from continuing operations ("EPS") for the fourth quarter ended December 31, 2015 were $0.87, compared to $1.03 EPS in the prior year period, representing a decrease of 16%. EPS from continuing operations for the fourth quarter of 2015 included discrete tax benefits of $0.06, compared to $0.02 EPS in the prior year period. Excluding these items, adjusted EPS from continuing operations for the fourth quarter of 2015 was $0.81, a decrease of 20% over an adjusted EPS of $1.01 in the prior year period. EPS for the fourth quarter ended December 31, 2015 and December 31, 2014 includes restructuring costs of $0.08 EPS and $0.16 EPS, respectively.

Revenue for the year ended December 31, 2015 was $7.0 billion, a decrease of 10% over the prior year, reflecting an organic revenue decline of 10% and an unfavorable impact from foreign exchange of 4%, offset by 4% growth from acquisitions. Earnings from continuing operations for the year ended December 31, 2015 were $595.9 million, a decrease of 23% as compared to $778.1 million for the prior year period. Diluted EPS for the year ended December 31, 2015 was $3.74, compared to $4.61 EPS in the prior year period, representing a decrease of 19%. EPS from continuing operations for the year ended December 31, 2015 included discrete tax benefits of $0.11, compared to $0.07 EPS in the prior year period. Excluding these items, adjusted EPS from continuing operations decreased 20% to $3.63 from an adjusted EPS of $4.54 in the prior year period. EPS for the year ended December 31, 2015 and 2014 includes restructuring costs of $0.25 EPS and $0.19 EPS, respectively. 

Robert A. Livingston, Dover's President and Chief Executive Officer, said, "Fourth quarter and full year results continued to be impacted by tough business conditions, particularly in oil & gas markets. In this environment, we delivered fourth quarter adjusted EPS of $0.81, driven by solid execution, as our teams continued to pursue customer wins, cost actions and productivity initiatives.

"During 2015, we increased our efforts around operating efficiencies through our Dover Excellence program. One key element of this program focuses on free cash flow generation, which increased to $795 million for the year. This program also supports our ongoing investment in product innovation and customer expansion activities. Additionally, during the year we took multiple steps to right-size our businesses to reflect difficult market conditions, especially in our Energy segment. These initiatives will remain a focus as we move into 2016.

"Regarding 2016, we are reaffirming EPS to be in the range of $3.85 to $4.05. This guidance reflects a lower revenue forecast driven by weaker oil & gas markets, essentially offset by an improved tax rate. In total, our full-year revenue growth, on an adjusted basis, is now anticipated to be in the range of 1% to 4%, comprising an organic revenue decline of (4%) to (1%), one point below our prior forecast. Acquisition growth of 7% and a 2% impact from FX remain unchanged from our prior forecast."

Net earnings for the fourth quarter ended December 31, 2015, were $141.8 million, or $0.91 EPS, which included earnings from discontinued operations of $5.3 million, compared to net earnings of $169.3 million, or $1.02 EPS, for the same period of 2014, which included a loss from discontinued operations of $2.5 million, or $0.02 EPS.

Net earnings for the year ended December 31, 2015, were $869.8 million, or $5.46 EPS, which included earnings from discontinued operations of $273.9 million, or $1.72 EPS, compared to net earnings of $775.2 million, or $4.59 EPS, for the same period of 2014, which included a loss from discontinued operations of $2.9 million, or $0.02 EPS. 2015 earnings from discontinued operations included gains of $265.6 million, or $1.67 EPS, resulting from the disposition of two businesses held for sale.

Dover will host a webcast of its fourth quarter 2015 conference call at 10:00 A.M. Eastern Time (9:00 A.M. Central Time) on Tuesday, January 26, 2016. 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 approximately $7 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 60 years, our team of 26,000 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, foreign exchange, changes in operations, acquisitions, industries in which Dover businesses operate, anticipated market conditions and our positioning, global economies, 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; changes in customer demand and capital spending; economic conditions generally and changes in economic conditions globally and in markets served by Dover businesses, including well activity and U.S. industrials activity; Dover's ability to achieve expected savings from integration and other cost-control initiatives, such as lean and productivity programs as well as efforts to reduce sourcing input costs; the impact of interest rate and currency exchange rate fluctuations; 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; 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, tax policies, and export/import laws; protection and validity of patent and other intellectual property rights; the impact of legal matters and legal compliance risks; 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 2015


DOVER CORPORATION

CONSOLIDATED STATEMENTS OF EARNINGS

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






Three Months Ended December 31,


Years Ended December 31,


2015


2014


2015


2014

Revenue

$

1,694,600



$

1,977,947



$

6,956,311



$

7,752,728


Cost of goods and services

1,080,791



1,254,079



4,388,167



4,778,479


Gross profit

613,809



723,868



2,568,144



2,974,249


Selling and administrative expenses

414,365



460,377



1,647,382



1,758,765


Operating earnings

199,444



263,491



920,762



1,215,484


Interest expense, net

31,249



31,332



127,257



127,179


Other (income) expense, net

(1,295)



1,172



(7,105)



(5,902)


Earnings before provision for income taxes and
discontinued operations

169,490



230,987



800,610



1,094,207


Provision for income taxes

32,916



59,152



204,729



316,067


Earnings from continuing operations

136,574



171,835



595,881



778,140


Earnings (loss) from discontinued operations, net

5,251



(2,541)



273,948



(2,905)


Net earnings

$

141,825



$

169,294



$

869,829



$

775,235










Basic earnings per common share:








Earnings from continuing operations

$

0.88



$

1.04



$

3.78



$

4.67


Earnings (loss) from discontinued operations, net

0.03



(0.02)



1.74



(0.02)


Net earnings

0.92



1.03



5.52



4.65










Weighted average shares outstanding

154,986


164,589


157,619


166,692









Diluted earnings per common share:








Earnings from continuing operations

$

0.87



$

1.03



$

3.74



$

4.61


Earnings (loss) from discontinued operations, net

0.03



(0.02)



1.72



(0.02)


Net earnings

0.91



1.02



5.46



4.59










Weighted average shares outstanding

156,254


166,467


159,172


168,842









Dividends paid per common share

$

0.42



$

0.40



$

1.64



$

1.55










 


DOVER CORPORATION

QUARTERLY SEGMENT INFORMATION

(unaudited)(in thousands)



2015


2014


Q1

Q2

Q3

Q4

FY 2015


Q1

Q2

Q3

Q4

FY 2014

REVENUE












Energy

$

430,423


$

366,044


$

363,872


$

323,341


$

1,483,680



$

478,773


$

481,016


$

507,334


$

550,116


$

2,017,239














Engineered Systems












Printing & Identification

230,181


229,934


227,992


255,563


943,670



231,679


252,354


257,282


247,569


988,884


Industrials

343,015


363,157


351,404


341,667


1,399,243



335,995


361,467


355,019


344,600


1,397,081



573,196


593,091


579,396


597,230


2,342,913



567,674


613,821


612,301


592,169


2,385,965














Fluids

340,236


351,511


352,018


355,508


1,399,273



345,009


346,275


361,797


377,485


1,430,566














Refrigeration & Food Equipment

372,097


448,115


492,460


418,758


1,731,430



411,493


522,357


528,807


458,532


1,921,189














Intra-segment eliminations

(451)


(133)


(164)


(237)


(985)



(379)


(833)


(664)


(355)


(2,231)


Total consolidated revenue

$

1,715,501


$

1,758,628


$

1,787,582


$

1,694,600


$

6,956,311



$

1,802,570


$

1,962,636


$

2,009,575


$

1,977,947


$

7,752,728














NET EARNINGS












Segment Earnings:












Energy

$

52,305


$

40,909


$

48,726


$

31,250


$

173,190



$

118,968


$

114,991


$

122,738


$

105,118


$

461,815


Engineered Systems

88,149


96,702


102,866


89,244


376,961



83,227


101,766


108,800


93,205


386,998


Fluids

54,634


70,168


74,911


62,404


262,117



57,942


63,112


67,559


63,026


251,639


Refrigeration & Food Equipment

36,150


65,732


76,665


42,752


221,299



44,862


84,926


78,012


30,934


238,734


Total Segments

231,238


273,511


303,168


225,650


1,033,567



304,999


364,795


377,109


292,283


1,339,186


Corporate expense / other

34,526


20,382


25,881


24,911


105,700



30,734


29,287


27,815


29,964


117,800


Net interest expense

32,037


31,988


31,983


31,249


127,257



32,655


31,961


31,231


31,332


127,179


Earnings from continuing
operations before provision
for income taxes

164,675


221,141


245,304


169,490


800,610



241,610


303,547


318,063


230,987


1,094,207


Provision for income taxes

47,485


65,507


58,821


32,916


204,729



71,569


92,966


92,380


59,152


316,067


Earnings from continuing operations

117,190


155,634


186,483


136,574


595,881



170,041


210,581


225,683


171,835


778,140


Earnings (loss) from
discontinued operations, net

92,320


176,762


(385)


5,251


273,948



(9,903)


3,378


6,161


(2,541)


(2,905)


Net earnings

$

209,510


$

332,396


$

186,098


$

141,825


$

869,829



$

160,138


$

213,959


$

231,844


$

169,294


$

775,235














SEGMENT OPERATING MARGIN










Energy

12.2

%

11.2

%

13.4

%

9.7

%

11.7

%


24.8

%

23.9

%

24.2

%

19.1

%

22.9

%

Engineered Systems

15.4

%

16.3

%

17.8

%

14.9

%

16.1

%


14.7

%

16.6

%

17.8

%

15.7

%

16.2

%

Fluids

16.1

%

20.0

%

21.3

%

17.6

%

18.7

%


16.8

%

18.2

%

18.7

%

16.7

%

17.6

%

Refrigeration & Food Equipment

9.7

%

14.7

%

15.6

%

10.2

%

12.8

%


10.9

%

16.3

%

14.8

%

6.7

%

12.4

%

Total Segment

13.5

%

15.6

%

17.0

%

13.3

%

14.9

%


16.9

%

18.6

%

18.8

%

14.8

%

17.3

%













DEPRECIATION AND AMORTIZATION EXPENSE










Energy

$

34,427


$

32,740


$

31,858


$

42,754


$

141,779



$

25,575


$

25,807


$

27,145


$

33,429


$

111,956


Engineered Systems

14,526


14,392


14,503


16,493


59,914



15,850


15,982


15,334


14,780


61,946


Fluids

13,848


13,648


13,367


15,215


56,078



16,366


15,308


14,019


15,210


60,903


Refrigeration & Food Equipment

16,458


16,406


16,609


16,601


66,074



17,212


17,451


17,073


16,965


68,701


Corporate

923


841


837


643


3,244



870


1,000


910


902


3,682



$

80,182


$

78,027


$

77,174


$

91,706


$

327,089



$

75,873


$

75,548


$

74,481


$

81,286


$

307,188














 


DOVER CORPORATION

QUARTERLY SEGMENT INFORMATION

 (continued)

(unaudited)(in thousands)



2015


2014


Q1

Q2

Q3

Q4

FY 2015


Q1

Q2

Q3

Q4

FY 2014

BOOKINGS












Energy

$

416,628


$

345,079


$

351,557


$

315,996


$

1,429,260



$

478,469


$

477,162


$

526,134


$

534,646


$

2,016,411














Engineered Systems












Printing & Identification

235,617


224,203


226,756


250,639


937,215



250,416


245,429


249,288


248,071


993,204


Industrials

337,070


336,173


338,744


357,451


1,369,438



370,949


363,773


342,687


374,438


1,451,847



572,687


560,376


565,500


608,090


2,306,653



621,365


609,202


591,975


622,509


2,445,051














Fluids

339,310


333,695


357,032


321,154


1,351,191



362,943


375,009


350,853


345,553


1,434,358














Refrigeration & Food Equipment

419,659


486,793


430,681


379,967


1,717,100



493,731


542,810


459,099


367,567


1,863,207














Intra-segment eliminations

(628)


(417)


(385)


(486)


(1,916)



(506)


(1,089)


(737)


(644)


(2,976)














Total consolidated bookings

$

1,747,656


$

1,725,526


$

1,704,385


$

1,624,721


$

6,802,288



$

1,956,002


$

2,003,094


$

1,927,324


$

1,869,631


$

7,756,051














BACKLOG












Energy

$

212,060


$

194,819


$

156,631


$

155,586




$

210,846


$

206,415


$

232,739


$

233,347















Engineered Systems












Printing & Identification

108,151


103,403


100,476


98,288




131,298


128,912


115,352


110,359



Industrials

276,598


248,592


236,298


250,725




266,517


268,680


254,612


282,598




384,749


351,995


336,774


349,013




397,815


397,592


369,964


392,957















Fluids

259,504


240,389


236,608


243,459




328,617


348,508


323,424


277,834















Refrigeration & Food Equipment

337,084


373,193


307,351


247,352




431,298


450,065


376,141


282,507















Intra-segment eliminations

(595)


(354)


(598)


(808)




(374)


(211)


(302)


(431)















Total consolidated backlog

$

1,192,802


$

1,160,042


$

1,036,766


$

994,602




$

1,368,202


$

1,402,369


$

1,301,966


$

1,186,214



 


DOVER CORPORATION

QUARTERLY EARNINGS PER SHARE

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





2015


2014


Q1

Q2

Q3

Q4

FY 2015


Q1

Q2

Q3

Q4

FY 2014

Basic earnings (loss) per common share:
































Continuing operations

$

0.72


$

0.98


$

1.20


$

0.88


$

3.78



$

1.00


$

1.26


$

1.36


$

1.04


$

4.67


Discontinued operations

0.57


1.11



0.03


1.74



$

(0.06)


$

0.02


$

0.04


$

(0.02)


$

(0.02)


Net earnings

1.30


2.10


1.20


0.92


5.52



$

0.94


$

1.29


$

1.40


$

1.03


$

4.65














Diluted earnings (loss) per common share:










Continuing operations

$

0.72


$

0.97


$

1.19


$

0.87


$

3.74



$

0.99


$

1.25


$

1.34


$

1.03


$

4.61


Discontinued operations

0.57


1.10



0.03


1.72



$

(0.06)


$

0.02


$

0.04


$

(0.02)


$

(0.02)


Net earnings

1.28


2.07


1.19


0.91


5.46



$

0.93


$

1.27


$

1.38


$

1.02


$

4.59














Adjusted diluted earnings per common share (calculated below):

Continuing operations

$

0.72


$

0.97


$

1.14


$

0.81


$

3.63



$

0.97


$

1.25


$

1.31


$

1.01


$

4.54














Net earnings (loss) and average shares used in calculated earnings (loss) per share amounts are as follows:













Net earnings (loss):












Continuing operations

$

117,190


$

155,634


$

186,483


$

136,574


$

595,881



$

170,041


$

210,581


$

225,683


$

171,835


$

778,140


Discontinued operations

92,320


176,762


(385)


5,251


273,948



(9,903)


3,378


6,161


(2,541)


(2,905)


Net earnings

209,510


332,396


186,098


141,825


869,829



160,138


213,959


231,844


169,294


775,235














Average shares outstanding:










Basic

161,650


158,640


155,300


154,986


157,619



169,750


166,474


166,021


164,589


166,692


Diluted

163,323


160,398


156,560


156,254


159,172



172,013


168,857


168,343


166,467


168,842




































Note:












Earnings from continuing operations are adjusted by discrete tax items to derive adjusted earnings from continuing operations and adjusted diluted earnings per common share as follows:














2015


2014


Q1

Q2

Q3

Q4

FY 2015


Q1

Q2

Q3

Q4

FY 2014

Adjusted earnings from continuing operations:









Earnings from continuing operations

$

117,190


$

155,634


$

186,483


$

136,574


$

595,881



$

170,041


$

210,581


$

225,683


$

171,835


$

778,140


Gains (losses) from discrete and other tax items



8,131


9,382


17,513



2,541


(635)


5,524


3,860


11,290


Adjusted earnings from continuing operations

$

117,190


$

155,634


$

178,352


$

127,192


$

578,368



$

167,500


$

211,216


$

220,159


$

167,975


$

766,850














Adjusted diluted earnings per common share:










Earnings from continuing operations

$

0.72


$

0.97


$

1.19


$

0.87


$

3.74



$

0.99


$

1.25


$

1.34


$

1.03


$

4.61


Gains (losses) from discrete and other tax items



0.05


0.06


0.11



0.01



0.03


0.02


0.07


Adjusted earnings from continuing operations

$

0.72


$

0.97


$

1.14


$

0.81


$

3.63



$

0.97


$

1.25


$

1.31


$

1.01


$

4.54














* Per share data may not add due to rounding.











































 


DOVER CORPORATION

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)






December 31, 2015


December 31, 2014

Assets:




Cash and cash equivalents

$

362,185



$

681,581


Receivables, net of allowances

1,120,490



1,186,746


Inventories, net

802,895



863,737


Other current assets

135,209



101,905


Property, plant and equipment, net

854,269



837,069


Goodwill

3,737,389



3,491,557


Intangible assets, net

1,413,223



1,369,520


Deferred taxes and other assets

194,103



171,005


Assets of discontinued operations



327,171


Total assets

$

8,619,763



$

9,030,291






Liabilities and Stockholders' Equity:




Notes payable and current maturities of long-term debt

$

151,122



$

777,956


Payables and accrued expenses

1,216,060



1,260,893


Deferred taxes and other non-current liabilities

990,664



986,958


Long-term debt

2,617,342



2,253,041


Liabilities of discontinued operations



50,718


Stockholders' equity

3,644,575



3,700,725


Total liabilities and stockholders' equity

$

8,619,763



$

9,030,291


 


DOVER CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited)(in thousands)




Years Ended December 31,


2015


2014

Operating activities:




Net earnings

$

869,829



$

775,235


(Earnings) loss from discontinued operations, net

(273,948)



2,905


Depreciation and amortization

327,089



307,188


Stock-based compensation

30,697



31,628


Contributions to employee benefit plans

(21,942)



(24,232)


Net change in assets and liabilities

17,334



(142,560)


Net cash provided by operating activities of continuing operations

949,059



950,164






Investing activities:




Additions to property, plant and equipment

(154,251)



(166,033)


Acquisitions (net of cash and cash equivalents acquired)

(567,843)



(802,254)


Proceeds from the sale of property, plant and equipment

14,604



14,373


Proceeds from the sale of businesses

689,314



191,348


Settlement of net investment hedge

(17,752)




Other

1,350



(19,991)


Net cash used in investing activities of continuing operations

(34,578)



(782,557)






Financing activities:




Cash received from Knowles Corporation, net of cash distributed



359,955


Change in notes payable, net

(327,000)



251,500


Net increase in debt

94,252



(6,566)


Dividends to stockholders

(257,969)



(258,487)


Purchase of common stock

(600,164)



(601,077)


Net proceeds from exercise of share-based awards

(1,005)



(814)


Net cash used in financing activities of continuing operations

(1,091,886)



(255,489)






Net cash (used in) provided by discontinued operations

(115,930)



6,007






Effect of exchange rate changes on cash

(26,061)



(40,426)






Net decrease in cash and cash equivalents

(319,396)



(122,301)


Cash and cash equivalents at beginning of period

681,581



803,882


Cash and cash equivalents at end of period

$

362,185



$

681,581


 

DOVER CORPORATION

QUARTERLY FREE CASH FLOW

(unaudited)(in thousands)






2015


2014


Q1

Q2

Q3

Q4

FY 2015


Q1

Q2

Q3

Q4

FY 2014

Cash flow from operating activities

$

131,332


$

218,911


$

282,213


$

316,603


$

949,059



$

28,361


$

185,013


$

292,012


$

444,778


$

950,164


Less: Additions to property, plant and equipment

(27,956)


(43,807)


(39,516)


(42,972)


(154,251)



(32,695)


(42,550)


(33,532)


(57,256)


(166,033)


Free cash flow

$

103,376


$

175,104


$

242,697


$

273,631


$

794,808



$

(4,334)


$

142,463


$

258,480


$

387,522


$

784,131














Free cash flow as a percentage of earnings from continuing operations

88.2

%

112.5

%

130.1

%

200.4

%

133.4

%


(2.5)%


67.7

%

114.5

%

225.5

%

100.8

%













Free cash flow as a percentage of revenue

6.0

%

10.0

%

13.6

%

16.1

%

11.4

%


(0.2)%


7.3

%

12.9

%

19.6

%

10.1

%

 

ADDITIONAL INFORMATION
FOURTH QUARTER AND FULL YEAR 2015

Acquisitions

During the fourth quarter of 2015, the Company completed three acquisitions across the Fluids segment and the Printing & Identification platform of the Engineered Systems segment. For the full year 2015, Dover made a total of four acquisitions for consideration totaling $567.8 million.

Discontinued Operations

For the fourth quarter of 2015, the Company recognized a gain from discontinued operations of $5.3 million, or $0.03 EPS. On a full-year basis, the Company generated net earnings of $273.9 million, or $1.72 EPS. Included in this amount is a $87.8 million gain on sale of Datamax O'Neil, which was sold in the first quarter of 2015 and a $177.8 million gain on sale of Sargent Aerospace, which was sold in the second quarter of 2015. Also included in the results of discontinued operations is $6.3 million of earnings, or $0.04 EPS, attributable to the operations of Datamax O'Neil and Sargent Aerospace.

Restructuring and Other Costs

During the quarter, the Company took actions to adjust our costs and streamline our businesses, resulting in $16.5 million, or $0.08 EPS, of restructuring charges. These charges were incurred primarily at each of our business segments, including $4.2 million in Energy, $4.5 million in Engineered Systems, $1.3 million in Fluids, and $6.3 million in Refrigeration & Food Equipment. For full year, restructuring costs totaled $55.2 million, or $0.25 EPS, of which primarily $30.8 million was incurred in Energy, $13.3 million in Engineered Systems, $4.9 million in Fluids, and $5.8 million in Refrigeration and Food Equipment.

Tax Rate

The effective tax rate on continuing operations was 19.4% and 25.6% for the fourth quarters of 2015 and 2014, respectively. On a full year basis, the effective tax rates on continuing operations for 2015 and 2014 were 25.6% and 28.9%, respectively.  The 2015 and 2014 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 25.0% and 27.3% for 2015 and 2014, respectively, and the full year rates were 27.8% and 29.9% for 2015 and 2014, respectively. The reduction in the effective tax rate year over year is principally due to a change in the geographic mix of earnings as well as restructuring of foreign operations.

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,


2015


2014


2015


2014

Free Cash Flow (dollars in thousands)








Cash flow provided by operating activities

$

316,603



444,778



$

949,059



$

950,164


Less: Capital expenditures

(42,972)



(57,256)



(154,251)



(166,033)


Free cash flow

$

273,631



$

387,522



$

794,808



$

784,131










Free cash flow as a percentage of revenue

16.1

%


19.6

%


11.4

%


10.1

%









Free cash flow as a percentage of earnings from continuing operations





133.4

%


100.8

%

















The fourth quarter 2015 decrease in free cash flow reflects lower earnings relative to the prior year driven by lower volume and product mix.

Revenue Growth Factors


2015


Q1


Q2


Q3


Q4


Full Year


Organic

(6)%



(10)%



(10)%



(12)%



(10)%



Acquisitions

5%



4%



3%



2%



4%



Currency translation

(4)%



(4)%



(4)%



(4)%



(4)%




(5)%



(10)%



(11)%



(14)%

(1)


(10)%

(1)


















(1) Includes a decline in revenue in Q4 within the Refrigeration & Food Equipment segment due to the divestiture of a product line.

Share Repurchases

In January 2015, the Board of Directors approved a new standing share repurchase authorization, whereby the Company may repurchase up to 15 million shares of its common stock over the following three years. This plan replaced the Company's $1.0 billion share repurchase program, which it completed in 2014. During the year ended December 31, 2015, the Company purchased a total of approximately 8.2 million shares of its common stock in the open market at a total cost of $600.2 million, or $72.94 per share.  As of December 31, 2015, the approximate number of shares still available for repurchase under the January 2015 share repurchase authorization was 6.8 million.

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, 2015


December 31, 2014

Current maturities of long-term debt


$

122



$

299,956


Commercial paper


151,000



478,000


Long-term debt


2,617,342



2,253,041


Total debt


2,768,464



3,030,997


Less: Cash and cash equivalents


(362,185)



(681,581)


Net debt


2,406,279



2,349,416


Add: Stockholders' equity


3,644,575



3,700,725


Net capitalization


$

6,050,854



$

6,050,141


Net debt to net capitalization


39.8

%


38.8

%

Non-GAAP Information:

These Investor Supplement tables contain non-GAAP measures of adjusted earnings from continuing operations used in calculating adjusted diluted earnings per common share, as 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.

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/dover-reports-fourth-quarter-and-full-year-2015-results-and-reaffirms-2016-eps-guidance-300209628.html

SOURCE Dover

Investor: Paul Goldberg, Vice President - Investor Relations, (212) 922-1640, peg@dovercorp.com; Media: Adrian Sakowicz, Vice President - Communications, (630) 743-5039, asakowicz@dovercorp.com