Gorman-Rupp Reports 2010 Results On Record Fourth Quarter

The Gorman-Rupp Company (NYSE Amex: GRC) reports net sales and earnings for the fourth quarter and twelve months ended December 31, 2010.

Net sales during the fourth quarter ended December 31, 2010 increased 36.1% to a record $84,689,000 compared to $62,203,000 during the same period in 2009. Net income increased 159.6% to a record $9,655,000 compared to $3,719,000 in 2009’s fourth quarter. Earnings per share were $0.57 and $0.22 for the respective periods.

Net sales during the quarter continued to be positively impacted by the slowly improving global economy. Primary increases were in sales to the international, municipal, construction, rental and industrial markets, partially offset by decreased sales in the OEM market. The fourth quarter also includes sales of National Pump Company acquired October 1, 2010.

The increase in earnings for the quarter principally reflects improved operating leverage on the higher volume of sales. Earnings include $0.05 per share due to the partial liquidation of LIFO quantities as a result of reduced inventory levels at two operating units. The Company does not expect this inventory trend to continue. Fourth quarter earnings also benefited $0.04 per share from adjustments of inventory standard costs at two operating units and $0.03 per share from the 2010 research and development tax credit and the addition of National Pump Company.

Net sales during 2010 increased 11.5% to $296,808,000 compared to $266,242,000 during 2009. Net income increased 42.1% to $25,963,000 compared to $18,269,000 in 2009. Earnings per share were $1.55 and $1.09 for the respective periods. Sales to most markets increased in 2010 when compared to depressed 2009 levels, while the OEM market continued to be weak due to decreased sales of power generation equipment.

The Company’s backlog of orders increased 14.6% to $107.4 million at December 31, 2010 compared to $93.7 million a year ago. The increase from December 31, 2009 was largely due to orders arising from the construction, rental, and custom pump markets along with the inclusion of National Pump Company. Partially offsetting these backlog increases were declines in the municipal and OEM markets.

The Company’s balance sheet continues to remain strong with $34.2 million cash and short-term investments at year end. The Company generated $25.8 million in operating cash flow during 2010 and has excellent liquidity. During the quarter, $10.0 million of borrowings used to finance the acquisition of National Pump Company were re-paid with the remaining $25.0 million planned to be paid by the end of 2011.

Jeffrey S. Gorman, President and CEO said, “After experiencing a very challenging 2009 the Company finished 2010 strong, primarily as a result of organic revenue with notable improvements in incoming orders, operating income and earnings. It appears the global economy is gradually continuing to improve, although challenges remain in the OEM market and may slow fire protection opportunities. With a solid order backlog and the full integration of National Pump Company, we are increasingly optimistic that 2011 will be a good year for the Company.”

Released by David P. Emmens, Corporate Secretary, Telephone (419) 755-1477.
The Gorman-Rupp Company and Subsidiaries
Condensed Consolidated Statements of Income
(in thousands of dollars, except per share data)
       
Three Months Ended December 31, Twelve Months Ended December 31,
 
2010 2009 2010 2009
 
 
Net sales $ 84,689 $ 62,203 $ 296,808 $ 266,242
Cost of products sold   59,742     47,665   220,471     204,469
 
Gross profit 24,947 14,538 76,337 61,773
 
Selling, general and
administrative expenses   10,843     9,229   37,378     35,380
 
Operating income 14,104 5,309 38,959 26,393
 
Other income (expense) - net   (238 )   71   (626 )   862
 
Income before income taxes 13,866 5,380 38,333 27,255
Income taxes   4,211     1,661   12,370     8,986
 
Net income $ 9,655   $ 3,719 $ 25,963   $ 18,269
 
Basic and diluted earnings per share $ 0.57 $ 0.22 $ 1.55 $ 1.09
The Gorman-Rupp Company and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands of dollars)
   
December 31, December 31,
2010 2009
Assets
Cash and short-term investments $ 34,246 $ 45,908
Accounts receivable - net 51,996 37,239
Inventories 51,449 40,506
Deferred income taxes and other current assets   5,503   7,747
 
Total current assets 143,194 131,400
 
Property, plant and equipment - net 113,526 108,523
 
Deferred income taxes and other assets   29,987   9,501
 
Total assets $ 286,707 $ 249,424
 
Liabilities and shareholders' equity
 
Accounts payable $ 12,042 $ 8,972
Short-term debt 25,000 15,000
Accrued liabilities and expenses   22,636   19,203
 
Total current liabilities 59,678 43,175
 
Deferred and other income taxes 4,954 1,323
Retirement benefits - 5,044
Postretirement benefits 22,241 22,270
 
The Gorman-Rupp Company shareholders' equity 199,834 176,905
Noncontrolling interest   -   707
 
Total shareholders' equity   199,834   177,612
 
Total liabilities and shareholders' equity $ 286,707 $ 249,424
 
Shares outstanding 16,788,535 16,710,535

Copyright Business Wire 2010

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