The Gorman-Rupp Company (NYSE Amex: GRC) reports net sales and earnings for the second quarter and six months ended June 30, 2010.

Net sales during the second quarter ended June 30, 2010 increased 5.9% to $72,380,000 compared to $68,345,000 during the same period in 2009. Net income increased 16.2% to $5,656,000 compared to $4,867,000 in the second quarter 2009. Earnings per share were $0.34 and $0.29 for the two respective periods.

Net sales for the six months ended June 30, 2010 totaled $138,166,000, down 1.3% from net sales of $139,943,000 during the same period in 2009. Net income increased 8.3% to $10,153,000 compared to $9,373,000 in the first six months of 2009. Earnings per share were $0.61 and $0.56 for these two periods.

The increase in net sales during the quarter was positively impacted by the early stages of economic recovery and is due primarily to increases in sales to the international fire protection market, custom pump applications and the construction and rental market, partially offset by decreases in sales to the OEM and the domestic fire protection markets.

The increase in earnings for the quarter reflects continued cost savings implemented in 2009 which also contributed to the 16.8% increase in operating income. Changes in principal operating expenses, including LIFO and employee benefit costs, generally offset each other in the current quarter compared to the same period last year.

The Company’s backlog of orders increased to $105.0 million at June 30, 2010 compared to $82.9 million a year ago and $93.7 million at December 31, 2009. The increase from June 30, 2009 was largely due to orders arising from wastewater, rental and international fire protection applications.

Cash flow from operations during the first six months of 2010 was $16.5 million, resulting in a continuing strong liquidity position. During the quarter, the remaining $10.0 million of borrowings used to partially finance the expansion and consolidation of the Mansfield Division were re-paid. The Company remains financially strong with positive cash flow and no long-term or short-term debt.

Jeffrey S. Gorman, President and CEO said, “The Company experienced improved financial results during this quarter with earnings largely driven by solid operating performance in what is still an unpredictable environment. Customer order growth continues to be encouraging, but we still remain cautious as full economic recovery remains uncertain.”

Released by David P. Emmens, Corporate Secretary, Telephone (419) 755-1477.

For additional information contact Wayne L. Knabel, Chief Financial Officer, Telephone (419) 755-1397.
     
The Gorman-Rupp Company and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(in thousands of dollars, except per share data)
 
Three Months Ended June 30, Six Months Ended June 30,
 
2010 2009 2010 2009
 
 
Net sales $ 72,380 $ 68,345 $ 138,166 $ 139,943
Cost of products sold   55,094     52,555   105,431     108,808
 
Gross profit 17,286 15,790 32,735 31,135
 

Selling, general and administrative expenses
  8,375     8,790   17,134     17,778
 
Operating income 8,911 7,000 15,601 13,357
 
Other income (expense) - net   (400 )   202   (391 )   713
 
Income before income taxes 8,511 7,202 15,210 14,070
Income taxes   2,855     2,335   5,057     4,697
 
Net income $ 5,656   $ 4,867 $ 10,153   $ 9,373
 
Basic and diluted earnings per share $ 0.34 $ 0.29 $ 0.61 $ 0.56
 
The Gorman-Rupp Company and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands of dollars)
  Unaudited  
June 30, December 31,
2010 2009
Assets
Cash and short-term investments $ 38,729 $ 45,908
Accounts receivable - net 49,315 37,239
Inventories 37,711 40,506
Deferred income taxes and other current assets   4,538   7,747
 
Total current assets 130,293 131,400
 
Property, plant and equipment - net 108,381 108,523
 
Deferred income taxes and other assets   9,816   9,149
 
Total assets $ 248,490 $ 249,072
 
Liabilities and shareholders' equity
 
Accounts payable $ 13,669 $ 8,972
Short-term debt - 15,000
Accrued liabilities and expenses   25,766   19,203
 
Total current liabilities 39,435 43,175
 
Income taxes payable 971 971
Retirement benefits 2,768 5,044
Postretirement benefits 22,752 22,270
 
The Gorman-Rupp Company shareholders' equity 181,907 176,905
Noncontrolling interest   657   707
 
Total shareholders' equity   182,564   177,612
 
Total liabilities and shareholders' equity $ 248,490 $ 249,072
 
Shares outstanding 16,685,535 16,710,535

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