SEC Filing | IDEX Corporation

1 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------------ FORM 10-K

IDEX CORPORATION (Exact Name of Registrant As Specified in Its Charter) DELAWARE 36-3555336 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 630 DUNDEE ROAD 60062 NORTHBROOK, ILLINOIS (Zip Code) (Address of principal executive offices)

Registrant's telephone number, including area code: (847) 498-7070 SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:

SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: None Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [ ] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] The aggregate market value of the voting stock held by nonaffiliates of IDEX Corporation as of December 31, 1996 was $487,210,569. The number of shares outstanding of IDEX Corporation's common stock, par value $.01 per share (the "Common Stock"), as of February 5, 1997 was 29,146,410. DOCUMENTS INCORPORATED BY REFERENCE Portions of the 1996 annual report to shareholders of IDEX Corporation (the "1996 Annual Report") are incorporated by reference into Parts I and II of this Form 10-K and portions of the definitive Proxy Statement of IDEX Corporation (the "1997 Proxy Statement") with respect to the 1997 annual meeting of shareholders are incorporated by reference into Part III of this Form 10-K. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 PART I ITEM 1. BUSINESS. IDEX Corporation ("IDEX" or the "Company") designs, manufactures and markets a broad range of fluid handling and industrial products serving a diverse customer base in the U.S. and internationally. IDEX competes with relatively few major manufacturers in most of its markets, and believes that each of its twelve principal subsidiaries (the "Subsidiaries") has a significant domestic market share in its principal product area. The Company manufactures proprietary products of its own design with an engineering content. Generally, all of the Company's businesses compete on the basis of performance, quality, service and price. FLUID HANDLING GROUP The Fluid Handling Group, which in 1996 accounted for 75% of the Company's total sales, manufactures a wide variety of industrial pumps and controls, fire-fighting pumps and rescue tools, dispensing and mixing equipment, lubrication systems and low-horsepower compressors. In 1996, approximately 41% of this Group's sales were to customers outside the U.S. The eight business units comprising this Group are described below. CORKEN. Corken, headquartered in Oklahoma City, Oklahoma, produces low-horsepower compressors, vane and turbine pumps, and valves used for the transfer of liquefied petroleum gas ("LPG"), compressed natural gas, and other gaseous substances. Management believes Corken has approximately 50% of the market for pumps and small-horsepower compressors used in LP gas distribution facilities. Its principal competitor in this market is the Blackmer division of Dover Corporation. Corken faces many significant competitors in the industrial (non-LPG distribution) segment of its business. Most of Corken's sales are made through domestic and international distributors which incorporate Corken's products into engineered packages sold to ultimate users. Shipments outside the U.S. represent approximately 40% of Corken's sales. FLUID MANAGEMENT. Fluid Management, acquired July 29, 1996 for approximately $135 million, has its headquarters and a manufacturing facility in Wheeling, Illinois. Manufacturing facilities are also located in Sassenheim, Netherlands; Norderstedt, Germany; and Unanderra, Australia with sales and distribution facilities worldwide. Approximately 55% of sales are from outside the U.S. Fluid Management is the world's leading manufacturer of dispensing and mixing equipment that precisely meters and mixes a wide variety of liquids including paints, colorants, inks, dyes and other liquids and pastes. Its products, sold under such names as Miller(R), Harbil(R), Accutinter(R) and Eurotinter, can be found in local paint and building supply stores, paint plants, vehicle manufacturing facilities, and other locations where fluids are dispensed and mixed in precise volumes. Management believes Fluid Management has a 50% worldwide market share. HALE PRODUCTS. Hale has its headquarters and a manufacturing facility in Conshohocken, Pennsylvania. It also has production facilities in Shelby, North Carolina; St. Joseph, Tennessee; Warwick, England; and Erlangen, Germany and service and distribution centers in Dieburg, Germany and Singapore. Hale is the world's leading manufacturer of truck-mounted fire-fighting pumps and manufactures a wide range of portable, mobile and freestanding pumping units. Hale also is the world's leading manufacturer of rescue tool systems with the Hurst Jaws of Life(R) and Lukas rescue systems. It is estimated to have a worldwide market share for truck-mounted fire-fighting pumps and rescue systems in excess of 50%. Hale's principal competitor in the U.S. truck-mounted fire-fighting pump market is the Waterous Company, a subsidiary of American Cast Iron Pipe Company. Sales of Hale's truck-mounted fire-fighting pumps are made directly to manufacturers of fire trucks, while portable pumps and rescue tools are generally sold through independent distributors. Approximately 50% of Hale's sales are to customers outside the U.S. LUBRIQUIP. Lubriquip is headquartered in Warrensville Heights, Ohio and also has manufacturing plants in McKees Rocks, Pennsylvania, and Madison, Wisconsin and sales offices in Antwerp, Belgium and Singapore. Its products include a wide range of centralized oil and grease lubrication systems and force-feed lubricators marketed under the Trabon, Manzel, Grease Jockey, Kipp and OPCO trademarks for use in 1 3 general industrial and transportation applications. Lubriquip offers a wide variety of customized systems using selected standard components to meet specific customer requirements. Lubriquip is subject to competition from several companies in both the domestic and international markets; however, management estimates that Lubriquip is the largest U.S. producer of such systems with approximately one-third of the domestic market for centralized lubricating systems. Lubriquip's system components include pumps and pump packages for pneumatic, mechanical, electric and hydraulic operations; metering devices; electronic controllers; monitors and timers; and accessories. These systems are sold through independent distributors to a wide range of industrial markets, including machine tools (both automotive and general purpose), chemical processing, construction equipment, food processing machinery, engine and compressor, railroad, and over-the-road truck industries. Lubriquip's products are available worldwide through over 100 independent distributors, with international sales representing approximately 20% of total shipments. Through these networks, Lubriquip also provides an extensive support system of application engineering, service and repair parts for its products. MICROPUMP. Micropump has its headquarters and principal manufacturing facilities in Vancouver, Washington, and also has operations in St. Neots, England. Micropump, the leader in corrosion-resistant, magnetically-driven miniature pump technology with an estimated 40% market share, is subject to competition from several companies. Micropump's products include pumps and fluid management systems for low-flow abrasive and corrosive applications such as inks, dyes, solvents, chemicals, petrochemicals, acids and chlorides. Micropump products are used in a variety of industries including chemical processing, laboratory, medical, printing, electronics, pulp and paper, water treatment and textiles. Management estimates that 50% of Micropump's sales are to customers outside the U.S. PULSAFEEDER. Pulsafeeder has its headquarters and a manufacturing facility in Rochester, New York. It also manufactures products in Punta Gorda, Florida, and has sales offices in Singapore and Beijing, China. Pulsafeeder designs and markets a wide range of metering pumps and controls. These products precisely regulate the flow of liquids in mixing and blending applications. Primary markets served are water and wastewater treatment, chemical and hydrocarbon processing, food processing, and warewash institutional. Pulsafeeder products are grouped into three categories: engineered pumps, standard pumps and electronic controls. Engineered pumps, designed and manufactured in Rochester, New York, include positive displacement, hydraulically-actuated diaphragm pumps used in precise metering applications in such industries as electric/gas utilities, chemical processing, petroleum refining and pharmaceuticals, as well as specialty pumps targeted at niche markets, including pumps designed to handle highly corrosive chemicals. Standard pumps, manufactured in Punta Gorda, Florida, represent a growing portion of Pulsafeeder's business, and include metering pumps designed for water treatment and water conditioning applications. Electronic controls, also manufactured in Punta Gorda, Florida, are of advanced microprocessor-based design, and are used to control the chemical composition of fluids being pumped, including such applications as recirculating systems for cooling towers and boilers, and in the water treatment market. Pulsafeeder pumps are sold through an extensive network of company sales personnel and independent representatives. Management believes that Pulsafeeder has approximately 40% of the domestic market for metering pumps used in the process industries and water treatment markets. Approximately 25% of its sales are outside of the U.S. Pulsafeeder's principal competitor is Milton Roy, a unit of Sundstrand Corporation. VIKING PUMP. Viking Pump, headquartered in Cedar Falls, Iowa, is the largest business unit in the Company's Fluid Handling Group and is one of the world's largest producers of positive displacement rotary gear pumps (Viking's main product) and spur gear pumps. Management believes that Viking pumps, which are classified as rotary gear pumps, represent approximately 35% of the domestic rotary gear pump market. Viking's principal rotary pump competitors are Roper Industries and the Blackmer division of Dover Corporation. Viking's other products include rotary lobe and metering pumps, speed reducers, flow dividers and basket-type line strainers. 2 4 Viking pumps are used by numerous industries such as the chemical, petroleum, food, pulp and paper, machinery and construction industries. Viking is not dependent on any one industry for a substantial percentage of its sales. Sales of Viking pumps and replacement parts are made through approximately 100 independent distributors and directly to original equipment manufacturers. Approximately 35% of Viking's sales occur outside of the U.S. In addition to its facilities in Cedar Falls, Iowa, Viking also maintains manufacturing facilities in Eastbourne, England; Windsor, Ontario, Canada; Shannon, Ireland; and has sales offices in Alphen, Netherlands; Singapore; Toronto, Ontario, Canada; and Beijing, China. Viking operates two foundries in Cedar Falls, Iowa which supply a majority of Viking's castings requirements. In addition, these foundries sell a variety of castings to outside customers. WARREN RUPP. Warren Rupp is a producer of air-operated and motor-driven double-diaphragm pumps, generally sold under the SandPIPER trade name. This business unit is headquartered in Mansfield, Ohio and has a distribution and assembly facility in Shannon, Ireland to serve the European market and a sales office in Singapore. Warren Rupp's principal competitor is Wilden Pump and Engineering Co. Management believes that Warren Rupp has approximately one-third of the domestic market for air-operated double-diaphragm pumps. Warren Rupp's pumps are well suited for pumping liquids, slurries and solids in suspension. Its pump models are made from cast iron, stainless steel and non-metallic composites to meet requirements to pump various types of material. End-user markets include the paint, chemical, mining, construction, and automotive service industries. Warren Rupp pumps are sold through a network of independent distributors and directly to a small number of original equipment manufacturers. Sales outside of the U.S. represent approximately 45% of Warren Rupp sales. INDUSTRIAL PRODUCTS GROUP The Industrial Products Group, which in 1996 accounted for 25% of the Company's total sales, manufactures sheet metal fabricating equipment and tooling, stainless steel banding and clamping devices, vibration control devices, and sign-mounting products and systems. In 1996, approximately 41% of this Group's sales were to customers outside the U.S. The four business units comprising this Group are described below. BAND-IT. Band-It, headquartered in Denver, Colorado, is one of the largest worldwide producers of stainless steel bands, buckles and preformed clamps and related installation tools. Its clamps are used to secure hoses to nipples, devices to pipes and poles, signs to sign standards, fences to posts, insulation to pipes, and for hundreds of other industrial clamping functions. Band-It also has developed an exclusive line of tools for installing its clamping devices. Management believes that Band-It has approximately 50% of the domestic market for quality stainless steel bands and buckles; however, it is subject to competition from several companies in both the domestic and international markets. Band-It markets its products domestically and internationally. It has manufacturing and distribution facilities in Staveley, England and in Singapore to serve the European and Pacific Basin markets. International sales account for approximately 50% of Band-It's sales. Its products are sold through a worldwide network of nearly 4,000 distributors to a wide range of markets, including the transportation, utilities, mining, oil and gas, industrial maintenance, construction, communication and electronics industries. SIGNFIX. Signfix has its headquarters and a manufacturing facility near Bristol, England with another manufacturing facility in Tipton, England. Signfix also has a distribution facility in Germany. Signfix, the leading U.K.-based manufacturer of sign-mounting devices and related equipment with an estimated 45% U.K. market share, is subject to competition from several companies. Signfix products include road, traffic and commercial sign-mounting systems, and stainless steel bands and clamps for various municipal, commercial and industrial applications. Management estimates that 20% of Signfix sales are to customers outside the U.K. STRIPPIT. Strippit, headquartered in Akron, New York, with sales and service offices in Swindon, England; Paris, France; Singapore; and Beijing, China, is the largest business unit in the Company's Industrial Products Group and is a manufacturer of a broad range of sheet metal fabricating equipment and tooling. 3 5 Strippit produces equipment which incorporates a high proportion of state-of-the-art technology and has numerous active patents in machine tool technology, none of which is individually material to its operations. Strippit's products include single station semi-automatic fabricators; advanced computer-controlled turret punching machines (including models with plasma arc or laser cutting heads); punches, dies and related tooling items; load/unload systems for use in conjunction with Strippit's equipment; and hand-operated metal forming machines for use in industries which utilize light gauges of sheet metal. Strippit also is a distributor of Burgmaster metal-cutting machines and parts. Strippit's products are sold through a combination of direct sales, and independent distributors and agents to a large and diverse customer base, including customers in the electronics, office, farm and hospital equipment markets. Approximately 35% of Strippit's total sales are to customers outside the U.S. Strippit is one of the largest domestic producers of its type of metal fabricating equipment, and management believes it has approximately 25% of the domestic market for numerically controlled punching machines. Its principal competitor, U.S. Amada, Ltd., is a Japanese firm which, based on its combined domestic production and imports, is currently believed to have a somewhat larger share of the numerically controlled punching machine market in the U.S. VIBRATECH. Vibratech, headquartered in Alden, New York, produces a broad line of engineered long-life mechanical energy absorption devices, providing vibration and motion control for transportation equipment, machinery manufacturers and other users. Vibratech's three major product lines are: viscous torsional vibration dampers used primarily for heavy duty diesel and high-horsepowered motorsport engines and transmissions; fluid and friction ride control products for rail, truck and vehicle manufacturers; and specialized aircraft vibration and motion control dampers. The largest portion of its sales are made directly to original equipment manufacturers who also service the replacement parts market. Vibratech's principal competitor in the viscous torsional vibration damper market for heavy duty diesel engines is a U.K.-based subsidiary of Cummins Engine, Inc., which serves the damper requirements of Cummins Engine in the U.S. market. Management believes that Vibratech has approximately 40% of the domestic market for viscous torsional vibration dampers, including that portion serviced by captive producers. Sales outside the U.S. are approximately 10% of Vibratech's total sales. GENERAL ASPECTS APPLICABLE TO THE COMPANY'S BUSINESS GROUPS EMPLOYEES. At December 31, 1996, IDEX had approximately 3,600 employees, of which approximately one-fourth were represented by labor unions with various contracts expiring through June 2000. Management believes that its relationship with employees is generally good. While no assurances can be given, management believes that the Company will be able to satisfactorily renegotiate its collective bargaining agreements. SUPPLIERS. IDEX manufactures many of the parts and components used in its products. Substantially all materials, parts and components purchased by IDEX are available from multiple sources. INVENTORY AND BACKLOG. Backlogs do not have material significance in either of the Company's business segments. The Company regularly and systematically adjusts production schedules and quantities based on the flow of incoming orders. While total inventory levels may also be affected by changes in orders, the Company generally tries to maintain relatively stable inventory levels based on its assessment of the requirements of the various industries served. SEGMENT INFORMATION. For segment financial information for the years 1996, 1995 and 1994 see the table presented on page 17 under "Management's Discussion and Analysis of Financial Condition and Results of Operations," as set forth in the 1996 Annual Report and incorporated herein by reference, and Note 11 of the "Notes to Consolidated Financial Statements" on page 28 of the 1996 Annual Report, which is incorporated herein by reference. EXPORTS. For export information for the years 1996, 1995 and 1994, see Note 11 of the "Notes to Consolidated Financial Statements" on page 28 of the 1996 Annual Report, which is incorporated herein by reference. 4 6 EXECUTIVE OFFICERS OF THE REGISTRANT The following table sets forth the names of the executive officers of the Company, their ages, the positions and offices with the Company held by them, and their business experience during the past 5 years.

The Company's executive officers are elected at a meeting of the Board of Directors immediately following the annual meeting of shareholders, and they serve until the next annual meeting of the Board, or until their successors are duly elected. ITEM 2. PROPERTIES. The Company's principal plants and offices have an aggregate floor space area of approximately 2.4 million square feet, of which 1.8 million square feet (75%) are located in the U.S., and approximately .6 million (25%) are located outside the U.S., primarily in the U.K. (8%), Germany (7%) and the Netherlands (4%). These facilities are considered to be suitable and adequate for their operations. Management believes that utilization of manufacturing capacity ranges from 50% to 80% in each facility. The Company's executive offices occupy approximately 10,000 square feet of leased space in Northbrook, Illinois. Approximately 1.9 million square feet (79%) of the principal plant and office floor area is owned by the Company, and the balance is held under lease. Approximately 1.9 million square feet (79%) of the principal plant and office floor area is held by business units in the Fluid Handling Group and .5 million square feet (21%) is held by business units in the Industrial Products Group. 5 7 ITEM 3. LEGAL PROCEEDINGS. The Company and the Subsidiaries are party to various legal proceedings arising in the ordinary course of business, none of which is expected to have a material adverse effect on the Company's business or financial condition. The Subsidiaries are subject to extensive federal, state and local laws, rules and regulations pertaining to environmental, waste management and health and safety matters. Permits are or may be required for some of the Subsidiaries' facilities and waste-handling activities and these permits are subject to revocation, modification and renewal. In addition, risks of substantial costs and liabilities are inherent in the Subsidiaries' operations and facilities, as they are with other companies engaged in similar industries, and there can be no assurance that such costs and liabilities will not be incurred. The Company is not aware of any environmental, health or safety matter which could, individually or in the aggregate, materially adversely affect the business or financial condition of the Company or any of its Subsidiaries. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER MATTERS. Information regarding the prices of and dividends on the Common Stock, and certain related matters, is incorporated herein by reference to "Shareholder Information" at page 33 of the 1996 Annual Report. The principal market for the Common Stock is the New York Stock Exchange. As of February 5, 1997, the Common Stock was held by 1,309 shareholders and there were 29,146,410 shares of Common Stock outstanding. ITEM 6. SELECTED FINANCIAL DATA. The information set forth under "Historical Data" at page 15 of the 1996 Annual Report is incorporated herein by reference. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The information set forth under "Management's Discussion and Analysis of Financial Condition and Results of Operations" at pages 16 to 19 of the 1996 Annual Report is incorporated herein by reference. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. The Consolidated Financial Statements of IDEX, including the Notes thereto, together with the independent auditors' report thereon of Deloitte & Touche LLP at pages 20 to 30 of the 1996 Annual Report are incorporated herein by reference. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH INDEPENDENT AUDITORS ON ACCOUNTING AND FINANCIAL DISCLOSURE. None. 6 8 PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT. Certain information regarding the directors of the Company is incorporated herein by reference to the information set forth under "Election of Directors" at pages 2 to 6 of the 1997 Proxy Statement. Information regarding executive officers of the Company is incorporated herein by reference to Item 1 of this report under the caption "Executive Officers of the Registrant" at page 5. Certain information regarding compliance with Section 16(a) of the Securities and Exchange Act of 1934, as amended, is incorporated herein by reference to the information set forth under "Compliance with Section 16(a) of the Exchange Act" at page 17 of the 1997 Proxy Statement. ITEM 11. EXECUTIVE COMPENSATION. Information regarding executive compensation is incorporated by reference to the materials under the caption "Compensation of Directors and Executive Officers" at pages 7 to 13 of the 1997 Proxy Statement. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT. Information regarding security ownership of certain beneficial owners and management is incorporated herein by reference set forth under "Principal Shareholders" at pages 14 to 15 of the 1997 Proxy Statement. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. Information regarding certain relationships and related transactions is incorporated herein by reference to the information set forth under "Election of Directors -- Certain Interests" at page 6 of the 1997 Proxy Statement. 7 9 PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K. (A) 1. Financial Statements The following financial statements are incorporated herein by reference to the 1996 Annual Report.

3. Exhibits The exhibits filed with this report are listed on the "Exhibit Index." (B) Reports on Form 8-K In a report on Form 8-K dated July 29, 1996 and filed with the Securities and Exchange Commission on October 15, 1996, the Company reported the purchase of certain assets and assumption of certain liabilities of Fluid Management Limited Partnership for approximately $133 million and issuance of 75,700 shares (113,550 shares, as adjusted to reflect the 3-for-2 common stock dividend effective January 31, 1997) of IDEX Common Stock. 8 10 INDEPENDENT AUDITORS' REPORT IDEX Corporation: We have audited the financial statements of IDEX Corporation and its Subsidiaries as of December 31, 1996 and 1995 and for each of the three years in the period ended December 31, 1996, and have issued our report thereon, dated January 21, 1997; such financial statements and report are included in your 1996 Annual Report to Shareholders and are incorporated herein by reference. Our audits also included the financial statement schedule of IDEX Corporation, listed in Item 14. This financial statement schedule is the responsibility of the Company's management. Our responsibility is to express an opinion based on our audits. In our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth herein. Deloitte & Touche LLP Chicago, Illinois January 21, 1997 IDEX CORPORATION AND SUBSIDIARIES SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

- ------------------------- (1) Represents uncollectible accounts, net of recoveries. 9 11 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized, on the 12th day of February, 1997. IDEX CORPORATION By /s/ WAYNE P. SAYATOVIC -------------------------------------- Wayne P. Sayatovic Senior Vice President -- Finance, Chief Financial Officer and Secretary Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:

10 12 EXHIBIT INDEX

11 13

12 14

13 15

- ------------------------- * Filed herewith. ** Management contract or compensatory plan or arrangement. 14

1 Exhibit 13 [GRAPHIC] New Product Development [GRAPHIC] Acquisition Strategy [GRAPHIC] International Presence [GRAPHIC] Market Leadership [IDEX 96 LOGO] IDEX Corporation - Annual Report 2 [IDEX 96 LOGO] IDEX Corporation manufactures an extensive array of proprietary, engineered industrial products sold to customers in a variety of industries around the globe. Our businesses have leading positions in their niche markets, and we have a history of achieving high profit margins. Among factors in the success equation at IDEX are emphasis on the worth of our people, fleetfootedness, ethical business conduct, continuing new product development, superior customer service, top-quality products, market share growth, international expansion, and above-average shareholder returns. The IDEX acronym stands for -- and the essence of IDEX is - Innovation, Diversity, and EXcellence. The shares of IDEX Corporation are traded on the New York Stock Exchange and the Chicago Stock Exchange under the symbol IEX. TOTAL SHAREHOLDER RETURNS IDEX $100 June 2 89 S&P INDEX 100 June 2 89 116 1989 111 1989 79 1990 108 1990 115 1991 141 1991 164 1992 151 1992 246 1993 167 1993 291 1994 168 1994 428 1995 232 1995 427 1996 286 1996

[BAR GRAPH] Total return to IDEX shareholders since going public in June 1989 has been 327%. In the same period the S&P 500 has increased 186%. CONTENTS PAGE Shareholders' Letter....................................2 Business Groups.........................................4 Business Profile........................................6 Market Leadership.......................................8 Product and Process Innovation.........................10 Acquisition Strategy...................................12 Historical Data........................................14 Management's Discussion and Analysis...................16 Financial Statements...................................20 Business Units.........................................31 Corporate Officers and Directors.......................32 Shareholder Information................................33 3 Financial Highlights (dollars and share amounts in thousands except per share data) - -------------------------------------------------------------------------------- NET SALES (in millions) 1988 1989 1990 1991 1992 1993 1994 1995 1996 200 221 228 228 277 309 400 487 563 [BAR GRAPH] EARNINGS PER SHARE 1988 1989 1990 1991 1992 1993 1994 1995 1996 .34 .58 .65 .63 .71 .87 1.15 1.53 1.69 [BAR GRAPH] Sales have grown at a 14% compound annual rate and earnings per share have increased at a 22% rate since IDEX was formed in 1988.
Years ended December 31................. 1996 CHANGE 1995 CHANGE 1994 ---- ------ ---- ------ ---- RESULTS OF OPERATIONS Net sales............................... $562,551 15% $ 487,336 22% $ 399,502 Income from operations.................. 98,305 14 86,238 32 65,538 Interest expense........................ 18,942 19 15,948 17 13,581 Net income.............................. 50,198 11 45,325 35 33,610 FINANCIAL POSITION Working capital......................... $108,313 5% $ 103,091 26% $ 82,007 Total assets............................ 583,773 25 466,122 26 371,096 Long-term debt.......................... 271,709 32 206,184 23 168,166 Shareholders' equity.................... 195,509 30 150,945 30 116,305 PERFORMANCE MEASURES Percent of net sales Income from operations............... 17.5% 17.7% 16.4% Net income........................... 8.9 9.3 8.4 Return on average assets................ 9.7 10.8 10.7 Debt as a percent of capitalization..... 58.2 57.7 59.1 Return on average shareholders' equity.. 29.0 33.9 33.6 PER SHARE DATA Net income.............................. $ 1.69 10% $ 1.53% 34% $ 1.15 Cash dividends paid..................... .43 16 .37 - Shareholders' equity.................... 6.76 28 5.26 29 4.06 OTHER DATA Employees............................... 3,598 11% 3,233 14% 2,841 Shareholders of record.................. 1,305 (4) 1,359 (2) 1,388 Weighted average shares outstanding..... 29,779 1 29,609 1 29,331
All share and per share data throughout this report have been restated to reflect the three-for-two stock splits effected in the form of 50% stock dividends in January 1995 and 1997. 1 4 SHAREHOLDER'S LETTER - -------------------------------------------------------------------------------- TO OUR SHAREHOLDERS: 1996 was another excellent year for IDEX. Records were set in sales, net income and earnings per share; we acquired a significant business; several new products were introduced; our international expansion continued; and the company ranked at the high end of peer group comparisons in profitability and growth. This year's performance continues the unbroken string of improvements in net income (before unusual items) since the company was formed in 1988. These achievements result from the superb contributions of an exceptionally capable team throughout IDEX of whom we're very proud. Recognizing the strength of the company and its prospects, our Board of Directors in December approved another three-for-two stock split and an increase in cash dividends. NET INCOME RISES 11% ON A SALES INCREASE OF 15% Net sales were a record $562.6 million in 1996 and increased by 15% over the $487.3 million of 1995. Net income reached a new high of $50.2 million and rose by 11% over the $45.3 million of last year. Earnings per share on a post-split basis at $1.69 grew by 16 cents over the previous high of $1.53 set in 1995. Market conditions enabled us to show an improvement of only 1% in the revenues of our base businesses, with almost all of the growth resulting from including 1995 acquisitions for a full year and our 1996 acquisition for five months. IDEX's operating profit margins always have been well above average for an industrial company. Our margins at 17.5% of sales were slightly below last year's 17.7%, but that was due entirely to the inclusion of the recently acquired businesses in this year's results. Our high base business margins were actually improved slightly, and we see opportunities to improve margins at recently acquired businesses. Since the company was formed in 1988, earnings per share have grown at a compound annual rate of 22%. FLUID MANAGEMENT ACQUIRED On July 29, 1996, IDEX acquired Fluid Management, headquartered in Wheeling, Illinois, with operations in the Netherlands, Germany and Australia, and with worldwide distribution. Fluid Management is the world's leading manufacturer of dispensing and mixing equipment for colorants, inks and dyes. We paid $135 million for the business, or about 8.3 times earnings before interest, taxes, depreciation, and amortization. Fluid Management has revenues of approximately $90 million, and about 50% of its sales occur outside of the U.S. Harbil(R), Miller(R), Accutinter(R) and Eurotinter are among the brand names one will see on its products in local paint stores, printing plants, truck manufacturing plants and other locations where paint, ink and other fluids are mixed and dispensed. Fluid Management is an IDEX type of company with excellent potential. We will continue to apply our rigid criteria and follow our disciplined approach as we seek to add businesses in the future. INTERNAL DEVELOPMENT We recognize that we must continuously improve operations and introduce new products to sustain the growth IDEX has exhibited to date. Our future success hinges on superior customer service and top-quality, state-of-the-art products manufactured at competitive prices. Again in 1996 about one-fourth of our sales resulted from products totally redesigned or introduced within the past four years. Among the new products introduced in 1996 were electronically controlled pumps at Warren Rupp, new truck-mounted LP gas pumps at Corken, the
International Sales Operating Margins Net Income Margins Value line Value line Percent of In Dollars Industrial Industrial Year Total Sales Millions Idex Composite Index Idex Composite Index 1987 19% 35 18% 10% 5% 6% 1988 22% 48 19% 10% 7% 5% 1989 24% 52 17% 9% 7% 4% 1990 26% 59 16% 8% 7% 4% 1991 28% 63 15% 8% 7% 4% 1992 28% 79 16% 9% 8% 5% 1993 27% 84 16% 10% 8% 5% 1994 32% 127 18% 11% 9% 6% 1995 35% 169 18% 11% 9% 6% 1996 41% 231 International growth has been Since formation of the IDEX has outperformed a key factor in IDEX's success. company, IDEX has continuously most manufacturers achieved significantly higher in net income margins. operating margins than most manufacturers.
2 5 - -----------------------------------------------------------------------------96) FoamMaster(R) pump system for fire fighting at Hale, a new peristaltic metering pump at Pulsafeeder, and a patented Ultra-Lok(R) clamping system at Band It. Quality has always been a cornerstone of business practice in IDEX, but the internationally recognized ISO 9000 standards have become the ideal in recent years. Every one of our business units--at all manufacturing locations around the globe--has achieved ISO certification. In our continuing efforts to improve efficiency and enhance customer service, we made major advances in business systems at Viking, Pulsafeeder, Signfix and Corken. We consolidated Pulsafeeder's Oklahoma facility with its operations in Florida, and we installed more productive manufacturing equipment in many locations. A normal measure of productivity is sales per employee, which has risen every year since IDEX began operations, and reached a new high of $167,000 in 1996. Our focus on cash flow enabled us to cut debt by $68 million in 1996 before borrowing $133 million to complete the Fluid Management acquisition. The tremendous potential in international markets has been a focus for several years. In 1996, 41% of total revenues were to customers outside of the U.S. and 62% of these revenues were produced in IDEX facilities outside the U.S. International sales growth has outpaced domestic growth for many years, and we expect this will continue as we emphasize international development in 1997 and the years beyond. STOCK SPLIT AND DIVIDEND INCREASE DEMONSTRATE CONFIDENCE Given IDEX's solid performance and its positive outlook, in December 1996 our Board of Directors declared a three-for-two stock split and a 12.5% increase in cash dividends. The stock split was effected in the form of a 50% stock dividend, and the cash dividend on the post-split shares is 12 cents per share per calendar quarter, which is equivalent to 18 cents on the pre-split shares, and is up by 2 cents from the previous dividend level. Both the stock split and the first increased cash dividend are being paid on January 31, 1997, to shareholders of record on January 15, 1997. POSITIONED FOR FUTURE GROWTH IDEX has many strengths that position it especially well for the future: - - We serve diverse markets. - - We sell to thousands of customers. - - We have significant market shares, with each of our businesses either number one or a close second in market share in its niche. - - We emphasize new product and process development. - - We have healthy margins and strong cash flow. - - Our international sales are significant and growing. - - We will continue to explore acquisition opportunities following our disciplined approach. These characteristics give us a solid base for future development. We are proud of all of the people of the company who have helped make IDEX successful and continue to carry out their responsibilities in an extraordinary manner. We believe 1997 will be another excellent year for IDEX, and that the years beyond also hold a great deal of promise. We hope that you, our shareholders, share in our positive view of tomorrow for IDEX. [Signature of Donald N. Boyce] Donald N. Boyce [PHOTO OF DONALD N. BOYCE] Chairman of the Board and President January 21, 1997 3 6 FLUID HANDLING GROUP - -------------------------------------------------------------------------------- [PHOTO] IDEX's Fluid Handling Group is comprised of eight business units that design, produce, and distribute a broad range of engineered industrial pumps and related controls, fire-fighting pumps and rescue tools, mixing and dispensing equipment, lubrication systems and low-horsepower compressors. In 1996 the Fluid Handling Group accounted for 75% of sales and 78% of profits. Sales to customers outside of the U.S. represented 41% of the Group's shipments. SALES [PIE CHART] Fluid Handling 75% Industrial Products 25% CORKEN FLUID MANAGEMENT HALE PRODUCTS LUBRIQUIP MICROPUMP PULSAFEEDER VIKING PUMP WARREN RUPP 4 7 INDUSTRIAL PRODUCTS GROUP - -------------------------------------------------------------------------------- [PHOTO] The Industrial Products Group includes four business units that design, produce and distribute proprietary products for a wide range of industrial applications. These products include metal fabrication equipment and tooling, high-quality stainless steel banding and clamping devices and related installation tools, sign mounting systems and vibration control mechanisms. The Industrial Products Group generated 25% of sales and 22% of profits in 1996, and sales to customers outside the U.S. represented 41% of its shipments. PROFITS [PIE CHART] Fluid Handling 78% Industrial Products 22% BAND-IT SIGNFIX STRIPPIT VIBRATECH 5 8 BUSINESS PROFILE
- ------------------------------------------------------------------------------------------------------------------------------------ [CORKEN [FLUID MANAGEMENT [HALE PRODUCTS [LUBRIQUIP PHOTO] PHOTO] PHOTO] PHOTO] CORKEN FLUID MANAGEMENT HALE PRODUCTS LUBRIQUIP PRODUCT Small-horsepower Precision-engineered Truck-mounted and portable Centralized oil and grease OFFERING compressors, vane and equipment for dispensing, fire pumps, and the Hurst lubrication systems, force- turbine pumps, and valves. metering and mixing paints, Jaws of Life(R) and Lukas feed lubricators, metering coatings, colorants, inks, rescue tool systems. devices, related electronic dyes and other liquids and control and accessories. pastes. - ------------------------------------------------------------------------------------------------------------------------------------ MARKETS Liquefied petroleum gas (LPG), Retail and commercial paint Public and private fire Machine tools, transfer SERVED oil and gas, petrochemical, outlets; printers; paint, and rescue applications. machines, conveyors, environmental, health care coating, ink and other packaging machinery, and general industrial. manufacturers. transportation equipment and construction machinery. - ------------------------------------------------------------------------------------------------------------------------------------ PRODUCT Products used for transfer Fluid management systems Pumps for water or foam to Lubrication devices to APPLICATIONS of LPG, alternative fuels for a wide variety of extinguish fires, and rescue prolong equipment life and and other gases and liquids. liquids and pastes in a equipment for extricating reduce maintenance costs. broad range of industries, accident victims. from retail point-of-sale equipment to complete manufacturing systems. - ------------------------------------------------------------------------------------------------------------------------------------ COMPETITIVE Market leader for pumps Industry innovator and World's leading manufacturer Market leader in centralized STRENGTHS and small-horsepower worldwide market leader of truck-mounted fire pumps lubrication systems serving compressors used in LPgas in automatic and manually and rescue systems with a broad range of industries. distribution facilities with operated dispensing, estimated worldwide market Estimated one-third market estimated 50% market share. metering and mixing share in excess of 50%. share. equipment. Estimated 50% worldwide market share. - ------------------------------------------------------------------------------------------------------------------------------------ INTERNATIONAL 40% of sales outside 55% of sales outside the 50% of sales outside the 20% of sales outside SCOPE the U.S. U.S. Also manufactures in U.S. Also manufactures in the U.S. the Netherlands, Germany England and Germany. and Australia. - ------------------------------------------------------------------------------------------------------------------------------------ EXAMPLES New truck-mounted LPgas New high-speed automatic New electronically New Trabon(R) modular OF RECENTLY pumps, and a new line dispensers featuring controlled FoamMaster(R) divider valve with zero-leak INTRODUCED of water cooled and flanged advanced graphic software, pump system for fire- inlet and integral filter, PRODUCTS gas compressors for the integrated label printer fighting applications. status indicators and process industries. and color matching system. electronic sensors. Completely redesigned line of manual and automatic dispensers and mixers for European market. - ------------------------------------------------------------------------------------------------------------------------------------ MANUFACTURING Oklahoma City, Oklahoma Wheeling, Illinois Conshohocken, Pennsylvania Warrensville Heights, Ohio LOCATIONS Sassenheim, Netherlands Shelby, North Carolina McKees Rocks, Norderstedt, Germany St. Joseph, Tennessee Pennsylvania Unanderra, Australia Warwick, England Madison, Wisconsin Erlangen, Germany
6 9
[MICROPUMP [PULSAFEEDER [VIKING PUMP [WARREN RUPP [BAND-IT PHOTO] PHOTO] PHOTO] PHOTO] PHOTO] MICROPUMP PULSAFEEDER VIKING PUMP WARREN RUPP BAND-IT PRODUCT Small, precision- Metering pumps, Positive displacement Double-diaphragm Stainless steel OFFERING engineered, magnetically special purpose rotary gear, lobe and pumps, both air- bands, buckles, and electromagnetically rotary pumps and metering pumps and operated and preformed driven centrifugal and related electronic related electronic motor-driven, clamps and rotary gear pumps. controls. controls. and accessories. installation tools. - ------------------------------------------------------------------------------------------------------------------------------------ MARKETS Chemical processing, Water and waste- Chemical processing, Chemical, paint, Transportation SERVED laboratory, medical, water treatment, petroleum, food food processing, equipment, printing, electronics, pulp chemical and processing, pulp and electronics, utilities, mining, and paper, water treatment hydrocarbon paper, construction construction, oil and gas, and textiles. processing, food and power generation. industrial industrial processing, and maintenance, maintenance, warewash utilities construction, institutional. and mining. electronics and communications. - ------------------------------------------------------------------------------------------------------------------------------------ PRODUCT Pumps and fluid Pumps and Pumps for materials Pumps for abrasive Clamps for APPLICATIONS management systems controls for ranging from anhydrous and semisolid securing hoses, for low-flow abrasive and introducing ammonia to peanut materials as well signs, signals, corrosive applications such precise amounts butter, from thin to as for applications pipes, poles, as inks, dyes, solvents, of fluids into highly viscous where product electrical lines chemicals, petrochemicals, processes to liquids. degradation is a and numerous other acids, and chlorides. manage chemical concern. "hold-together" composition. applications. - ------------------------------------------------------------------------------------------------------------------------------------ COMPETITIVE Market leader in corrosion- A leading Largest internal A leading diaphragm World's leading STRENGTHS resistant, magnetically manufacturer of gear pump producer. pump producer producer of driven, miniature pump metering pumps and Broad product offering products high-quality technology with estimated controls used in offering and extensive in several stainless steel 40% market share. water treatment application technology materials including bands, buckles and and process Estimated 35% share composites, clamps with applications. of rotary gear pump stainless steel estimated 50% Estimated 40% market. and cast iron. market share. market share. Estimated one-third market share. - ------------------------------------------------------------------------------------------------------------------------------------ INTERNATIONAL 50% of sales outside the 25% of sales 35% of sales outside 45% of sales 50% of sales SCOPE U.S. Also manufactures in outside the U.S. the U.S. Also outside the U.S. outside the U.S. England. manufactures in Also manufactures Also manufactures Canada, England and in Ireland. in England and Ireland. Singapore. - ------------------------------------------------------------------------------------------------------------------------------------ EXAMPLES New patented dual circuit New line of Internal gear pumps New interfaceable New series of patented OF RECENTLY pump for industrial ink jet peristaltic pumps with integral electronic controls installation tools for INTRODUCED printing and new canned and state-of-the- jacketing for to program double- 1/4" Tie-Lok(R) and PRODUCTS rotor pump for x-ray art microprocessor- controlling liquid diaphragm pump Ultra-Lok(R) ties. cooling equipment. based, digital temperature. Enhanced operations. New New 1/4" Ultra-Lok(R) logic controllers method of sealing pump non-conductive, band and buckle providing continuous shafts for highly groundable air- clamping system. and automatic flow viscous applications. operated double- control. diaphragm pumps. - ------------------------------------------------------------------------------------------------------------------------------------ MANUFACTURING Vancouver, Washington Rochester, New York Cedar Falls, Iowa Mansfield, Ohio Denver, Colorado LOCATIONS St. Neots, England Punta Gorda, Windsor, Ontario, Shannon, Ireland Staveley, England Florida Canada Singapore Eastbourne, England Shannon, Ireland
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[SIGNFIX [STRIPPIT [VIBRATECH PHOTO] PHOTO] PHOTO] SIGNFIX STRIPPIT VIBRATECH PRODUCT Sign-mounting Computer-controlled turret Engineered motion-damping OFFERING systems and punching machines, semi- products including viscous stainless steel banding automatic fabricators, torsional vibration dampers, and clamping products. punches, dies and related ride control and mechanical tooling items. energy absorption devices. - ---------------------------------------------------------------------------------------------------------- MARKETS Municipal and Office, food service, Heavy duty trucks, machinery, SERVED commercial agricultural and hospital motorsport, off-highway and signs, and equipment, electronic chassis rail vehicles. industrial and other metal fabrication maintenance industries. applications. - ---------------------------------------------------------------------------------------------------------- PRODUCT Road, traffic Equipment and tooling for Products to control motion, APPLICATIONS and commercial punching, bending, shearing vibration and shock. signs, bands and laser cutting sheet and clamps for metal. various applications. - ---------------------------------------------------------------------------------------------------------- COMPETITIVE Leader in U.K. for Industry innovator and Inventor and largest non- STRENGTHS sign-mounting products holder of numerous patents. captive U.S. producer of and systems with estimated A leading producer of torsional vibration dampers. 45% market share. computer-controlled turret Estimated 40% share of punching machines and viscous damper market. related tooling with estimated one-quarter market share. - ---------------------------------------------------------------------------------------------------------- INTERNATIONAL 20% of sales outside 35% of sales outside 10% of sales outside SCOPE the U.K. the U.S. the U.S. - ---------------------------------------------------------------------------------------------------------- EXAMPLES Patented "dovetail" sign- Enhanced Helios(R) laser New railfrog retarders OF RECENTLY mounting system and newly cutting system with versatile and Iron Highway rotary INTRODUCED designed cantilever street high-performance non-contact suspension dampers. PRODUCTS sign systems for the cutting head and an expanded U.S. market. line of hydraulically actuated fabricating machines. - ---------------------------------------------------------------------------------------------------------- MANUFACTURING Bristol, England Akron, New York Alden, New York LOCATIONS Tipton, England
11 [IDEX 96 LOGO] FLUID HANDLING GROUP Corken Fluid Management Hale Products Lubriquip Micropump Pulsafeeder Viking Pump Warren Rupp INDUSTRIAL PRODUCTS GROUP Band-It Signfix Strippit Vibratech 12 [TRI-LUBE PUMP PACKAGE PHOTO] MARKET - -------------------------------------------------------------------------------- LEADERSHIP IDEX enjoys strong leadership positions in all the markets it serves. Each of our 12 business units holds either the number one market position or has a sizable share as the number two producer in its niche. On a weighted average basis, we enjoy an approximate 40% share of the markets we serve. IDEX achieves these healthy positions by being customer-driven, responding quickly to users' needs with first-quality products of the latest design. We are a fleetfooted organization--nimble and deft--with strong controls, a sense of immediacy, and a will to eliminate unnecessary red tape that slows responsiveness. MARKETS SERVED [PIE CHART] LEAD-ER-SHIP Food Processing [proper pronuciation] Construction & Material Handling 1. ability to lead Oil & Refining 2. to be ahead or Transportation Equipment at the head of Water Conditioning Fabricated Metal Products Chemical Processing Fire & Rescue [HELIOS PHOTO] Paints & Coatings All Other 8 13 A market focus pervades our organization. We want to offer the best overall proposition in the market. This does not mean the lowest price--but the best value for customers considering such factors as service, durability, performance, selection, ease of use, features, productivity, safety, maintenance and long-term costs. As leaders, we have a rigorous program of market, product and process development, leaving no doubt with our customers that we do offer the best value. Most of our products are sold through well established industrial distribution networks with technological competence. Where unit volume requirements are higher, we also sell directly to original equipment manufacturers. Our distributors receive extensive training and support, and are our partners in assisting thousands of end-users worldwide with product selection and installation. Our market development efforts have taken us into more than 100 countries around the globe. International sales have grown from 19% of total sales nine years ago to 41% today, and we expect the pace of international expansion to continue. We share application ideas with agents, distributors and customers, thereby widening the base of industries and customers served. No single industry and no single customer accounts for a major part of our sales. IDEX's success hinges on the talent and performance of its people. We have an outstanding team of dedicated employees who follow a strict code of ethics. We want to be a company that people are proud to buy from, sell to, work for, and invest in. By following ethical practices; striving for operational superiority; providing superior quality, state of the art products; selling our wide product range to a broad spectrum of customers and industries; and continuously working with end-users and customers to develop new products, we believe IDEX exemplifies its acronym--Innovation, Diversity, and EXcellence. MARKET SHARE LEADERSHIP [PIE CHART] Estimated 40% weighted average share of markets served. INTERNATIONAL SALES [PIE CHART] Domestic 59% International 41% Europe 22% Far East 9% Rest of World 10% 9 14 [PHOTO] Product and INNOVATION Innovation is the word represented by the first letter of the IDEX name, and it is a key ingredient in our success equation. We support and foster processes that lead to product improvements and new products for our customers. For a number of years about 25% of our sales have come from products that have been totally redesigned or introduced within the past four years. One in 10 of the people at IDEX is directly engaged in product or process technology development. However, it is every employee's job to contribute to new product development, and so all business disciplines participate in the effort. Multidisciplinary teams work with customers, specifying engineers, users, distributors and focus groups to assure that our products are state of the art, incorporating the latest proven technology, and providing overall value to the customer. in-no-va-tion (in e-va shen) 1. something new or different introduced 2. act of innovating; [PHOTO] introduction of new things or methods 10 15 PROCESS [PHOTO] [PHOTO] While most of our products are mechanical in nature, they often include electronic control devices, so our engineering processes include the spectrum of technical specialties from mechanical, materials, hydraulics and pneumatics to electrical, electronic and software development. Among the many new products introduced by IDEX business units in 1996 were: - - A new line of peristaltic metering pumps at Pulsafeeder, [PHOTO] - - The Hale FoamMaster(R), an electronically controlled pump system for handling the full range of foam concentrates in fire fighting applications, - - New electronically operated, controlled volume pumps at Warren Rupp, - - New pumps for LP gas trucks at Corken, - - Hydraulically actuated, computer-controlled fabricating equipment at Strippit, and - - A broadened range of stainless steel clamping devices at Band-It. Delivering top quality products has always been a cornerstone of business practice at IDEX. However, in recent years, the internationally recognized ISO 9000 quality system has become the benchmark for quality. We are pleased to say that all of our business units are certified under the ISO 9000 standards, reinforcing our long-standing manufacturing integrity, and placing us at the forefront with customers who rightfully demand first class products. [PHOTO] We have a persistent urge to create new products within IDEX to leapfrog our own technology--and to stay well ahead of competition. Our fleetfooted approach helps us bring new products with proven reliability to the market at a rapid pace. IDEX's customers deserve the best and the latest of new product technology. NEW PRODUCT SALES [PIE CHART] 25% 11 16 [PHOTO] Acquisition STRATEGY IDEX focuses on companies that manufacture proprietary industrial products with leading positions in niche markets. Our carefully crafted and rigidly applied acquisition criteria are designed to promote growth in shareholder value rather than growth for growth's sake. We seek to acquire good companies and make them better, rather than trying to make sick companies well. Since 1989, we have completed 10 strategic acquisitions, each fitting the IDEX mold and now contributing strongly to our bottom line. In 1996 we completed our largest acquisition to date--Fluid Management. This company is the world's leading manufacturer of dispensing and mixing equipment for paints, colorants, inks and dyes. Headquartered in Wheeling, Illinois, Fluid Management also has manufacturing facilities in the Netherlands, Germany and Australia, and a distributor network that spans the globe. 1996 SALES [PHOTO] [PIE CHART] IDEX's three most recent acquisitions--Micropump, Lukas & Fluid Management--accounted for 16% of 1996 sales. strat-e-gy (strat e-je) 1. a plan for obtaining a specific goal 2. skill in managing or planning 12 17 [PHOTO-5 RODS] [PHOTO-16 PIPES] - -------------------------------------------------------------------------------- Its products, sold under such names as Miller(R), Harbil(R), Accutinter(R) and Eurotinter, can be found in local paint and building supply stores, printing plants, vehicle manufacturing facilities, and other locations where fluids are dispensed and mixed in precise volumes. Following the acquisition of a company, we immediately implement IDEX's financial control systems and begin the process of sharing the best practices of our business units, because there is commonality in the engineering principles, manufacturing methods, distribution channels and business systems in all of our companies. We have the advantage of implementing what works successfully in some locations and avoiding the problems of what doesn't work. This cross pollination has resulted in superior customer service and improved margins in our acquired businesses. Acquisitions have been an important element of IDEX's success, with a track record that speaks for itself. We will continue to use our very strong cash flow to enhance shareholder value by adding businesses from time to time that meet our strict standards. REPAIR & REPLACEMENT SALES [PIE CHART] 33% [PHOTO-LUKAS LKE 70 CUTTER] [PHOTO-MAN WITH BUCKET] 13 18 HISTORICAL DATA (dollars and share amounts in thousands except per share data)
NET SALES OPERATING MARGINS NET INCOME MARGINS (in millions) [LINE GRAPH] [LINE GRAPH] Value line Value line Industrial Industrial Year Idex Composite Index Year Idex Composite Index 1988 200 1988 18% 10% 1988 5% 6% 1989 221 1989 19% 10% 1989 7% 5% 1990 228 1990 17% 9% 1990 7% 4% 1991 228 1991 16% 8% 1991 7% 4% 1992 277 1992 15% 8% 1992 7% 4% 1993 309 1993 16% 9% 1993 8% 5% 1994 400 1994 16% 10% 1994 8% 5% 1995 487 1995 18% 11% 1995 9% 6% 1996 563 1996 18% 11% 1996 9% 6% Sales have grown at a 14% IDEX's operating margins Aftertax margins at compound annual rate. have consistently been IDEX compare very almost double those of favorably to those the average industrial of the average company. industrial company. EARNINGS PER SHARE EBITDA AND INTEREST TOTAL ASSETS AND (in millions) LONG-TERM DEBT (in millions) [BAR GRAPH] [LINE GRAPH] [LINE GRAPH] Long Interest Term Year EBITDA EXP Year Assets Dept Year 1988 .34 1988 43 19 1988 128 143 1989 .58 1989 48 18 1989 134 125 1990 .65 1990 47 16 1990 134 104 1991 .63 1991 45 13 1991 143 66 1992 .71 1992 53 12 1992 253 140 1993 .87 1993 61 11 1993 259 117 1994 1.15 1994 80 14 1994 371 168 1995 1.53 1995 103 16 1995 466 206 1996 1.69 1996 120 19 1996 584 272 Earnings per share IDEX's solid cash flow IDEX's balance sheet have grown at a 22% coverage of interest has strengthened compound annual rate. expense has improved considerably since significantly. its first year of operation in 1988.
14 19 [IDEX 96 LOGO]
1996 1995 1994 1993 1992 1991 1990 1989 1988 ---- ---- ---- ---- ---- ---- ---- ---- ---- RESULTS OF OPERATIONS Net sales..................... $562,551 $487,336 $399,502 $308,638 $277,129 $228,181 $228,397 $220,971 $200,351 Gross profit.................. 216,154 188,021 152,644 118,352 105,977 85,089 84,853 84,613 74,151 SG&A expenses ................ 111,507 97,486 83,980 68,217 63,123 47,014 44,521 42,648 37,135 Goodwill amortization ........ 6,342 4,297 3,126 1,989 1,523 626 588 588 554 Income from operations ....... 98,305 86,238 65,538 48,146 41,331 37,449 39,744 41,377 36,462 Other income expense.......... (509) 753 559 1,159 1,831 1,024 1,626 1,553 698 Interest expense ............. 18,942 15,948 13,581 11,007 12,178 12,730 15,566 17,828 18,552 Provision for income taxes.... 28,656 25,718 18,906 12,972 10,838 9,826 10,101 9,994 7,954 Income before extraordinary items ....................... 50,198 45,325 33,610 25,326 20,146 15,917 15,703 15,108 10,654 Extraordinary items .......... - - - - (3,441) 1,214 2,145 2,972 4,583 Net income ................... 50,198 45,325 33,610 25,326 16,705 17,131 17,848 18,080 15,237 Income applicable to common stock ....................... 50,198 45,325 33,610 25,326 16,705 17,131 17,848 14,857 10,012 FINANCIAL POSITION Current assets................ $201,170 $185,899 $151,357 $115,466 $116,723 $ 74,464 $ 75,697 $ 75,202 $ 68,983 Current liabilities........... 92,857 82,808 69,350 42,640 40,041 31,733 30,742 28,888 27,912 Working capital .............. 108,313 103,091 82,007 72,826 76,682 42,731 44,955 46,314 41,071 Current ratio ................ 2.2 2.2 2.2 2.7 2.9 2.3 2.5 2.6 2.5 Capital expenditures.......... 13,769 13,002 8,896 7,822 8,231 3,578 6,813 5,389 2,533 Depreciation and amortization ................ 23,208 17,122 14,315 11,898 10,576 7,638 6,579 6,206 6,938 Total assets ................. 583,773 466,122 371,096 258,967 253,300 143,142 134,356 133,687 128,124 Long-term debt ............... 271,709 206,184 168,166 117,464 139,827 65,788 103,863 124,942 143,308 Total liabilities ............ 388,264 315,177 254,791 175,281 194,569 106,030 138,643 156,969 172,607 Shareholders' equity ......... 195,509 150,945 116,305 83,686 58,731 37,112 (4,287) (23,282) (84,681) PERFORMANCE MEASURES Percent of net sales Gross profit ................ 38.4% 38.6% 38.2% 38.3% 38.2% 37.3% 37.2% 38.3% 37.0% SG&A expenses ............... 19.8 20.0 21.0 22.1 22.8 20.6 19.5 19.3 18.5 Goodwill amortization ....... 1.1 .9 .8 .6 .5 .3 .3 .3 .3 EBITDA....................... 21.4 21.2 20.0 19.6 19.1 19.8 20.6 21.8 21.5 Income from operations ...... 17.5 17.7 16.4 15.6 14.9 16.4 17.4 18.7 18.2 Income before extraordinary items ...................... 8.9 9.3 8.4 8.2 7.3 7.0 6.9 6.8 5.3 Return on average assets ..... 9.7 10.8 10.7 9.9 8.4 12.3 13.3 11.3 7.7 Debt as a percent of capitalization .............. 58.2 57.7 59.1 58.4 70.4 63.9 104.3 122.9 244.4 Return on average shareholders' equity ...................... 29.0 33.9 33.6 35.6 34.9 104.4 - - - PER SHARE DATA Income before extraordinary items ...................... $ 1.69 $ 1.53 $ 1.15 $ .87 $ .71 $ .63 $ .65 $ .58 $ .34 Net income .................. 1.69 1.53 1.15 .87 .59 .68 .73 .72 .64 Cash dividends declared...... .44 .39 .09 - - - - - - Cash dividends paid.......... .43 .37 - - - - - - - Shareholders' equity ........ 6.76 5.26 4.06 2.93 2.07 1.32 (.18) (.96) (5.38) Stock price High ...................... 27 5/8 29 1/2 19 1/2 16 10 5/8 8 7/8 7 3/4 7 1/2 - Low ....................... 19 7/8 18 3/8 15 1/8 9 3/4 7 3/8 4 1/4 4 5/8 6 1/8 - Close ..................... 26 5/8 27 1/8 18 3/4 15 7/8 10 5/8 7 3/8 4 3/4 7 1/2 - Price/earnings ratio at year end ................... 16 18 16 18 15 12 7 13 - OTHER DATA Employees ................... 3,598 3,233 2,841 2,354 2,377 1,919 1,925 1,962 1,819 Shareholders of record ...... 1,305 1,359 1,388 1,454 1,551 1,602 1,714 1,820 - Weighted average shares outstanding ................. 29,779 29,609 29,331 28,976 28,389 25,367 24,309 20,537 15,740 Shares outstanding at year end .................... 28,926 28,695 28,619 28,580 28,353 28,184 24,303 24,317 15,740
All share and per share data has been restated to reflect the three-for-two stock splits effected in the form of a 50% stock dividends in January 1995 and 1997. 15 20 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS HISTORICAL OVERVIEW AND OUTLOOK IDEX sells a broad range of proprietary fluid handling and industrial products to a diverse customer base in the U.S. and, to an increasing extent, internationally. Accordingly, IDEX's businesses are affected by levels of industrial activity and economic conditions in the U.S. and in other countries where its products are sold and by the relationship of the U.S. dollar to other currencies. Among the factors that influence the demand for IDEX's products are interest rates, levels of capital spending in certain industries, and overall industrial growth. IDEX has a history of strong operating margins. The Company's operating margins are impacted by, among other things, utilization of facilities as sales volumes change and inclusion of newly acquired businesses which may have lower margins and whose margins could be further reduced by purchase accounting adjustments. IDEX's 1996 orders, sales, net income and earnings per share surpassed the records set in the prior year. Backlogs decreased nominally as shipments exceeded incoming orders during 1996 but remain at IDEX's typical operating level of about 1-1/2 months' sales. This customarily low level of backlog allows IDEX to provide excellent customer service but also means that changes in orders are felt quickly in operating results. The following forward-looking statements are qualified by the cautionary statement under the Private Securities Litigation Reform Act set forth below. The slow rate of growth in the U.S. economy in 1995 continued during 1996, and growth in many other economies of the world improved only modestly. With a steady incoming order pace, strong market positions, a continuous flow of new and redesigned products, and increasing opportunities for expansion worldwide, the outlook for IDEX remains positive. Based on current activity levels and barring unforeseen circumstances, IDEX continues to expect that new records will be achieved in orders, sales, net income and earnings per share in 1997. By stressing new product development, market share growth, international expansion, operating improvements in newly acquired businesses, and by adhering to its disciplined approach to acquisitions, IDEX is well positioned to continue its growth progression profitably. CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT Demand for the Company's products is cyclical in nature and subject to changes in general market conditions that affect demand. The Company's customers operate primarily in industries that are rapidly impacted by changes in economic conditions, which in turn can influence orders. The Company operates without significant order backlogs. As a result, economic slowdowns could quickly have an adverse effect on the Company's performance. In addition, the Company's operating forecasts and budgets are based upon detailed assumptions which it believes are reasonable, but inherent difficulties in predicting the impact of certain factors may cause actual results to differ materially from the forward-looking statements set forth earlier. These factors include but are not limited to the following: the Company's utilization of its capacity and the impact of capacity utilization on costs; developments with respect to contingencies such as environmental matters and litigation; labor market conditions and raw materials costs; levels of industrial activity and economic conditions in the U.S. and other countries around the world; and levels of capital spending in certain industries, all of which have a material influence on order rates; the relationship of the U.S. dollar to other currencies; interest rates; the Company's ability to integrate and operate acquired businesses on a profitable basis; and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission. RESULTS OF OPERATIONS For purposes of this discussion and analysis section, reference is made to the table on page 17 and the Company's Statements of Consolidated Operations on page 21. IDEX consists of two business segments: Fluid Handling and Industrial Products. PERFORMANCE IN 1996 COMPARED TO 1995 Orders, sales, net income and earnings per share were at record levels for 1996. Incoming orders were 16% higher than 1995, with almost all of the increase resulting from the acquisitions of Micropump (May 1995), Lukas (October 1995) and Fluid Management (July 1996). The orders for the base businesses were essentially unchanged in 1996 from 1995. Sales for 1996 reached a record $562.6 million and increased $75.3 million or 15% over 1995. The inclusion of recently acquired businesses accounted for substantially all of the volume growth, while sales in the core business units rose by less than 1% from the prior year. Generally, the Company's pump operations experienced modest growth which was offset by declines in capital goods-related shipments. International sales accounted for 41% of the 1996 total, up from 35%. The increase in international sales accounted for approximately 80% of the year-over-year improvement in total sales. Fluid Handling Group sales of $422.5 million increased $74.8 million or 22% from 1995. Inclusion of Fluid Management for a portion of the year, along with Micropump and Lukas for a full year, accounted for almost all of the sales improvement. Base business sales were up about 1% from the prior year. Sales outside the U.S. increased to 41% of total Fluid Handling Group sales in 1996 from 33% in 1995 due to the inclusion of recent acquisitions, each of which has a significant international presence, and stronger worldwide demand for products of the Group's core businesses, especially industrial pumps. Industrial Products Group sales of $141.5 million in 1996 increased by $1.6 million or 1% compared to 1995 as a result of steady demand for this Group's products. Shipments outside the U.S. were 41% of total sales in the Industrial Products Group in 1996, up from 38% in 1995, principally from greater international 16 21 [IDEX 96 LOGO] COMPANY AND BUSINESS GROUP FINANCIAL INFORMATION (DOLLARS IN THOUSANDS)
YEARS ENDED DECEMBER 31, (1) -------------------------------- 1996 1995 1994 ------- ------- ------- FLUID HANDLING GROUP Net sales(2). . . . . . . . . . . . . . . $422,528 $347,739 $275,598 Income from operations(3) . . . . . . . . 83,474 71,298 55,314 Operating margin . . . . . . . . . . . . 19.8% 20.5% 20.1% Identifiable assets . . . . . . . . . . . $488,273 $365,332 $284,571 Depreciation and amortization . . . . . . 19,055 13,539 10,695 Capital expenditures. . . . . . . . . . . 9,956 6,972 5,772 INDUSTRIAL PRODUCTS GROUP Net sales(2). . . . . . . . . . . . . . . $141,542 $139,945 $124,152 Income from operations(3) . . . . . . . . 23,311 23,165 18,034 Operating margin. . . . . . . . . . . . . 16.5% 16.6% 14.5% Identifiable assets . . . . . . . . . . . $ 78,555 $ 86,911 $ 73,693 Depreciation and amortization . . . . . . 3,308 2,840 2,930 Capital expenditures. . . . . . . . . . . 3,779 6,014 2,848 COMPANY Net sales . . . . . . . . . . . . . . . . $562,551 $487,336 $399,502 Income from operations. . . . . . . . . . 98,305 86,238 65,538 Operating margin. . . . . . . . . . . . . 17.5% 17.7% 16.4% Income before interest and income taxes . $ 97,796 $ 86,991 $ 66,097 Identifiable assets . . . . . . . . . . . 583,773 466,122 371,096 Depreciation and amortization (4) . . . . 22,568 16,498 13,696 Capital expenditures. . . . . . . . . . . 13,769 13,002 8,896
(1) Includes acquisitions of Hale Products (May 26, 1994), Micropump (May 2, 1995), Lukas (October 2, 1995) and Fluid Management (July 29, 1996) in the Fluid Handling Group. (2) Group net sales include intersegment sales. (3) Group income from operations excludes net unallocated corporate operating expenses. (4) Excludes amortization of debt issuance expenses. demand for banding and clamping devices, and sign-mounting systems. Gross profit of $216.2 million in 1996 increased $28.1 million or 15% from 1995. Gross profit as a percent of sales was 38.4% in 1996, down slightly from 38.6% in 1995. Selling, general and administrative expenses increased to $111.5 million in 1996 from $97.5 million in 1995 primarily from inclusion of recent acquisitions, but as a percentage of sales, decreased slightly to 19.8% in 1996 from 20.0% in 1995. Goodwill amortization increased 47% to $6.3 million in 1996 from $4.3 million in 1995, with about half of the increase attributable to the Fluid Management acquisition. As a percent of sales, goodwill amortization remained flat at about 1% for both years. Income from operations increased $12.1 million or 14% to $98.3 million in 1996 from $86.2 million in 1995. Operating margin as a percent of sales decreased nominally to 17.5% in 1996 from 17.7% in 1995. In the Fluid Handling Group, income from operations of $83.5 million and operating margin of 19.8% for 1996 compare to the $71.3 million and 20.5% recorded in 1995. The operating margin decline resulted from the inclusion of recent acquisitions whose operating margins were generally lower than the other business units in the Group and whose profits were further reduced by purchase accounting adjustments. Income from operations in the Industrial Products Group of $23.3 million and operating margin of 16.5% in 1996 were essentially equivalent to the totals of $23.2 million and 16.6% achieved in 1995. Interest expense increased to $18.9 million in 1996 from $15.9 million in 1995 because of the additional borrowing required to complete the Fluid Management acquisition, offset by a slightly lower interest rate environment in 1996. The provision for income taxes increased to $28.7 million in 1996 from $25.7 million in 1995. The effective tax rate of 36.3% in 1996 was essentially unchanged from the 36.2% recorded in the prior year. Net income of $50.2 million in 1996 was 11% higher than the net income of $45.3 million in 1995. Earnings per share, adjusted for the three-for-two stock split described below, were $1.69 in 1996, an increase of 16 cents from the previous record of $1.53 achieved in 1995. 17 22 In December 1996 the Company's Board of Directors authorized a three- for-two stock split to be effected in the form of a 50% stock dividend payable on January 31, 1997, to shareholders of record on January 15, 1997. The par value of common stock remained at $.01. Shareholders' equity has been restated to give retroactive recognition to the stock split for all periods presented by reclassifying from additional paid-in-capital to common stock the par value of the additional shares arising from the split. All references in the financial statements to number of shares, per share amounts and market prices of the Company's common stock have been restated. PERFORMANCE IN 1995 COMPARED TO 1994 Orders, sales, net income and earnings per share for 1995 exceeded the levels achieved in all previous years. Incoming orders were 18% higher than 1994 with about one-quarter of the increase stemming from growth in the Company's base businesses and the other three-quarters resulting from the recent acquisitions of Hale Products (May 1994), Micropump (May 1995) and Lukas (October 1995). Sales for 1995 of $487.3 million increased $87.8 million or 22% over 1994. The inclusion of recently acquired businesses accounted for 12% of the volume growth, while sales in the other business units rose 10% over the prior year. This growth stemmed from a solid U.S. economy, continuous emphasis on developing international markets, and the addition of several new products. The increase of international sales accounted for about one half of the year-over- year improvement. Fluid Handling Group sales of $347.7 million increased $72.1 million or 26% from 1994. The inclusion of Micropump and Lukas for a portion of the year along with Hale Products for a full year, and higher sales volume from improved market conditions in each of the other Fluid Handling Group businesses accounted for the increase. Sales outside the U.S. increased to 33% of total Fluid Handling Group sales in 1995 from 30% in 1994 due to the inclusion of Micropump, Lukas and the international operations of Hale Products for a full year, and stronger worldwide demand for products of the base businesses in the Group. Industrial Products Group sales of $140.0 million increased $15.8 million or 13% compared to 1994 due to improved demand for products of all business units in this Group. Shipments outside the U.S. were 38% of total sales in the industrial Products Group in 1995, up from 36% in 1994. This was principally due to greater international demand for this Group's products, especially turret punching machines, and banding and clamping devices. Gross profit of $188.0 million in 1995 increased $35.4 million or 23% from 1994. Gross profit as a percent of sales rose to 38.6% in 1995, up from 38.2% in 1994. Selling, general and administrative expenses increased to $97.5 million in 1995 from $84.0 million in 1994, but as a percentage of sales decreased to 20.0% in 1995 compared to 21.0% in 1994. Recent acquisitions caused goodwill amortization to increase to $4.3 million in 1995 from $3.1 million in 1994. As a percent of sales, goodwill amortization remained below 1% in both years. Income from operations increased $20.7 million or 32% to $86.2 million in 1995 from $65.5 million in 1994. Operating margin as a percent of sales increased to 17.7% in 1995 from 16.4% in 1994. In the Fluid Handing Group, income from operations of $71.3 million and operating margin of 20.5% for 1995 were both higher than the $55.3 million and 20.1% recorded in 1994. Operating margin improvements resulted primarily from volume related gains with improving business conditions in the core businesses of the Group. These factors were partially offset by inclusion of Micropump and Lukas for a portion of the year, and a full year of Hale Products activity, all of whose operating margins, as expected, were somewhat lower than the other units in the Group and whose profits were further affected by purchase accounting adjustments. Income from operations in the Industrial Products Group of $23.2 million and operating margin of 16.6% in 1995 increased from the totals of $18.0 million and 14.5% achieved in 1994 due primarily to volume related improvements. Interest expense increased to $15.9 million in 1995 from $13.6 million in 1994 because of additional borrowings to complete the acquisitions of Micropump and Lukas, and a slightly higher interest rate environment in 1995. The provision for income taxes increased to $25.7 million in 1995 from $18.9 million in 1994. The effective tax rate increased to 36.2% in 1995 from 36.0% in 1994. Net income of $45.3 million in 1995 was 35% higher than net income of $33.6 million in 1994. Earnings per share of $1.53 in 1995 increased 34% from the $1.15 recorded in 1994. LIQUIDITY AND CAPITAL RESOURCES At December 31, 1996, IDEX's working capital was $108.3 million and its current ratio was 2.2 to 1. Internally generated funds were more than adequate to fund capital expenditures of $13.8 million, $13.0 million and $8.9 million for 1996, 1995 and 1994, respectively, and dividends on common stock of $12.3 million and $10.7 million in 1996 and 1995, respectively. Capital expenditures were generally for machinery and equipment which improved productivity, although a portion was for repair and replacement of equipment and facilities. Management believes that IDEX has ample capacity in its plant and equipment to meet expected needs for future growth in the intermediate term. During 1996, 1995 and 1994, depreciation and amortization expense, excluding amortization of debt issuance expenses, was $22.6 million, $16.5 million and $13.7 million, respectively. In July 1996 the Company entered into a multi-currency amended U.S. credit agreement increasing the maximum amount available to $250 million and improving the interest rate structure. At December 31, 1996, $160.1 million was borrowed under this facility, 18 23 [IDEX 96 LOGO] including a Netherlands guilder borrowing of 82.0 million ($47.1 million) which provides an economic hedge against the net investment in Fluid Management's Netherlands operation. The availability under this facility declines in stages commencing July 1, 1999, to $200 million on July 1, 2000. Any amount outstanding at July 1, 2001, becomes due at that date. Interest is payable quarterly on the outstanding balance at the bank agent's reference rate or at LIBOR plus an applicable margin. At December 31, 1996, the applicable margin was 50 basis points. The Company also has a $10 million demand line of credit available for short-term borrowing requirements at the bank agent's reference rate or at an optional rate based on the bank's cost of funds. At December 31, 1996, there were no borrowings under this short-term line of credit. At December 31, 1996, the maximum amount available under the German credit agreement was DM 52.5 million ($34.1 million), of which DM 50.0 million ($32.5 million) was being used and provides an economic hedge against the net investment in the Lukas operation. The availability under this agreement declines in stages commencing November 1, 1997, to DM 31.3 million at November 1, 2000. Any amount outstanding at November 1, 2001, becomes due at that date. Interest is payable quarterly on the outstanding balance at LIBOR plus 100 basis points. On July 29, 1996, IDEX acquired Fluid Management for $135 million, including IDEX common stock valued at approximately $2 million. The acquisition was accounted for using the purchase method of accounting and was financed through a borrowing under the U.S. credit agreement and the issuance of 113,550 shares of IDEX common stock. In December 1996 the Company's Board of Directors authorized a three- for-two common stock split and a 12.5% increase in the quarterly cash dividend. The cash dividend on the post-split shares was set at 12 cents per common share per calendar quarter. Both the stock dividend and first increased cash dividend will be paid on January 31, 1997, to shareholders of record on January 15, 1997. IDEX believes it will generate sufficient cash flow from operations in 1997 to meet its operating requirements, interest and scheduled amortization payments under both the amended U.S. credit agreement and the German credit agreement, interest and principal payments on the Senior Subordinated Notes, approximately $20 million of planned capital expenditures, and approximately $14 million of annual dividend payments to holders of common stock. From commencement of operations in January 1988 until December 31, 1996, IDEX has borrowed $410 million under the credit agreements to complete 10 acquisitions. During this same period IDEX generated, principally from operations, cash flow of $307 million to reduce its indebtedness. In the event that suitable businesses or assets are available for acquisition by IDEX upon terms acceptable to the Board of Directors, IDEX may obtain all or a portion of the financing for the acquisitions through the incurrence of additional long-term indebtedness.
NET SALES BY OPERATING GROUP PROFITS BY OPERATING GROUP (in millions) (in millions) Industrial Products Industrial Products Fluid Handling Fluid Handling [BAR GRAPH] [BAR GRAPH] Year Fluid Indust. Year Fluid Indust. 1988 105 95 1988 26 14 1989 125 97 1989 31 15 1990 134 95 1990 32 12 1991 139 89 1991 32 12 1992 187 90 1992 38 12 1993 213 96 1993 41 14 1994 276 124 1994 55 18 1995 348 140 1995 71 23 1996 423 142 1996 83 23
19 24 IDEX CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands except share and per share amounts)
As of December 31, 1996 1995 --------- --------- ASSETS Current assets Cash and cash equivalents . . . . . . . . . . . $ 5,295 $ 5,937 Receivables - net. . . . . . . . . . . . . . . 91,200 70,338 Inventories . . . . . . . . . . . . . . . . . . 97,516 101,052 Deferred taxes . . . . . . . . . . . . . . . . 4,835 7,045 Other current assets . . . . . . . . . . . . . 2,324 1,527 -------- -------- Total current assets . . . . . . . . . . . . . 201,170 185,899 Property, plant and equipment - net . . . . . . 102,383 91,278 Intangible assets - net . . . . . . . . . . . . 274,511 184,217 Other noncurrent assets . . . . . . . . . . . . 5,709 4,728 -------- -------- Total assets . . . . . . . . . . . . . . . . . $583,773 $466,122 ======== ======== LIABILITIES AND SHAREHOLDERS'EQUITY Current liabilities Trade accounts payable. . . . . . . . . . . . . $ 40,670 $ 36,846 Dividends payable . . . . . . . . . . . . . . . 3,471 3,061 Accrued expenses. . . . . . . . . . . . . . . . 48,716 42,901 -------- -------- Total current liabilities. . . . . . . . . . . 92,857 82,808 Long-term debt . . . . . . . . . . . . . . . . . 271,709 206,184 Other noncurrent liabilities . . . . . . . . . . 23,698 26,185 -------- -------- Total liabilities. . . . . . . . . . . . . . . 388,264 315,177 -------- -------- Shareholders' equity Common stock, par value $.01 per share Shares authorized 1996 - 75,000,000; 1995 - 50,000,000 Shares issued and outstanding 1996 - 28,925,867; 1995 - 28,695,426 . . 289 287 Additional paid-in capital. . . . . . . . . . . 89,657 86,022 Retained earnings . . . . . . . . . . . . . . . 105,238 67,729 Accumulated translation adjustment. . . . . . . 325 (3,093) -------- -------- Total shareholders' equity . . . . . . . . . . 195,509 150,945 -------- -------- Total liabilities and shareholders' equity . . $583,773 $466,122 ======== ========
See Notes to Consolidated Financial Statements. 20 25 [IDEX LOGO] IDEX CORPORATION AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED OPERATIONS (in thousands except per share amounts)
For the years ended December 31, 1996 1995 1994 -------- -------- -------- Net sales ................................. $562,551 $487,336 $399,502 Cost of sales ............................. 346,397 299,315 246,858 -------- -------- -------- Gross profit .............................. 216,154 188,021 152,644 Selling, general and administrative expenses .................. 111,507 97,486 83,980 Goodwill amortization ..................... 6,342 4,297 3,126 -------- -------- -------- Income from operations .................... 98,305 86,238 65,538 Other income(expense) - net ............... (509) 753 559 -------- -------- -------- Income before interest expense and income taxes ............................. 97,796 86,991 66,097 Interest expense .......................... 18,942 15,948 13,581 -------- -------- -------- Income before income taxes ................ 78,854 71,043 52,516 Provision for income taxes ................ 28,656 25,718 18,906 -------- -------- -------- Net income ................................ $ 50,198 $ 45,325 $ 33,610 ======== ======== ======== Earnings per common share ................. $ 1.69 $ 1.53 $ 1.15 ======== ======== ======== Weighted average common shares outstanding .............................. 29,779 29,609 29,331 ======== ======== ========
See Notes to Consolidated Financial Statements. 21 26 IDEX CORPORATION AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY (in thousands except share and per share amounts)
Common Stock Accumulated Total and Additional Retained Translation Shareholders' Paid-In Capital Earnings Adjustment Equity --------------- -------- ------------ ------------- Balance, December 31, 1993................. $ 84,840 $ 2,551 $ (3,705) $ 83,686 Issuance of 39,434 shares of common stock from exercise of stock options..... 294 294 Cash dividends declared -$.09 per common share outstanding ............ (2,671) (2,671) Unrealized translation adjustment......... 1,386 1,386 Net income................................ 33,610 33,610 ------- ------- ------- ------- Balance, December 31, 1994................ 85,134 33,490 (2,319) 116,305 Issuance of 77,461 shares of common stock from exercise of stock options........... 1,175 1,175 Cash dividends declared - $.39 per common share outstanding........................ (11,086) (11,086) Unrealized translation adjustment........ (774) (774) Net income................................ 45,325 45,325 ------- ------- -------- -------- Balance, December 31, 1995................ 86,309 67,729 (3,093) 150,945 Issuance of 113,550 shares of common stock related to an acquisition................ 2,271 2,271 Issuance of 116,891 shares of common stock from exercise of stock options..... 1,366 1,366 Cash dividends declared - $.44 per common share outstanding........................ (12,689) (12,689) Unrealized translation adjustment......... 3,418 3,418 Net income................................ 50,198 50,198 ------ ------- ------- ------- Balance, December 31, 1996................ $ 89,946 $105,238 $ 325 $195,509 ========= ======== ======== ========
See Notes to Consolidated Financial Statements. 22 27 [IDEX LOGO] IDEX CORPORATION AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED CASH FLOWS (in thousands)
For the years ended December 31, 1996 1995 1994 ------ ------ ------ Cash flows from operating activities Net income . . . . . . . . . . . . . . . . . . . . . . . . . $ 50,198 $ 45,325 $ 33,610 Adjustments to reconcile net income to net cash flows from operating activities Depreciation and amortization . . . . . . . . . . . . . . 14,310 10,940 9,671 Amortization of intangibles . . . . . . . . . . . . . . . 8,258 5,558 4,025 Amortization of debt issuance expenses . . . . . . . . . . 640 624 619 Deferred income taxes . . . . . . . . . . . . . . . . . . 5,474 2,297 2,711 Increase in receivables . . . . . . . . . . . . . . . . . (4,124) (5,045) (7,611) (Increase) decrease in inventories . . . . . . . . . . . . 19,324 (10,222) 415 Increase (decrease) in trade accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . (3,136) 812 8,292 Increase (decrease) in accrued expenses . . . . . . . . . (2,564) 4,331 141 Other transactions - net . . . . . . . . . . . . . . . . . 4,084 470 654 -------- -------- ------- Net cash flows from operating activities . . . . . . . . . 92,464 55,090 52,527 -------- -------- ------- Cash flows from investing activities Additions to property, plant and equipment . . . . . . . . . (13,769) (13,002) (8,896) Acquisition of businesses (net of cash acquired) . . . . . . . . . . . . . . . . . . (132,584) (69,760) (91,558) -------- -------- -------- Net cash flows from investing activities . . . . . . . . (146,353) (82,762) (100,454) -------- -------- -------- Cash flows from financing activities Dividends paid . . . . . . . . . . . . . . . . . . . . . . (12,278) (10,697) Net borrowings under the credit agreements . . . . . . . . 64,586 37,968 50,000 Increase in accrued interest . . . . . . . . . . . . . . . . 939 50 702 -------- -------- -------- Net cash flows from financing activities . . . . . . . . . 53,247 27,321 50,702 -------- -------- -------- Net increase (decrease) in cash . . . . . . . . . . . . . . . (642) (351) 2,775 Cash and cash equivalents at beginning of year. . . . . . . . . 5,937 6,288 3,513 -------- -------- -------- Cash and cash equivalents at end of year. . . . . . . . . . . . $ 5,295 $ 5,937 $ 6,288 ======== ======== ========
See Notes to Consolidated Financial Statements. 23 28 IDEX CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands except share and per share amounts) 1. SIGNIFICANT ACCOUNTING POLICIES BUSINESS IDEX Corporation ("IDEX" or the "Company") is a manufacturer of a wide array of proprietary, engineered industrial products sold to a diverse customer base in a variety of industries in the U.S. and internationally. Its products include industrial pumps and controls; fire-fighting pumps and rescue equipment; dispensing and mixing equipment; stainless steel banding, clamping and sign-mounting devices; sheet metal fabricating equipment and tooling; automatic lubrication systems; small-horsepower compressors; and energy absorption equipment. These activities are grouped into two business segments: Fluid Handling and Industrial Products. PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the Company and its subsidiaries. Significant intercompany transactions and accounts have been eliminated. CASH EQUIVALENTS For purposes of the Statements of Consolidated Cash Flows, the Company considers all highly liquid debt instruments purchased with a maturity of three or fewer months to be cash equivalents. INVENTORIES Inventories are stated at the lower of cost or market. Cost, which includes labor, material and factory overhead, is determined on the first-in, first-out ("FIFO") basis or the last-in, first-out ("LIFO")basis, as described in Note 3. DEBT EXPENSES Expenses incurred in securing and issuing long-term debt are amortized over the life of the related debt. EARNINGS PER COMMON SHARE Earnings per common share are computed by dividing net income by the weighted average number of shares of common stock and common stock equivalents outstanding during the year. Common stock equivalents, in the form of stock options, have been included in the calculation of weighted average shares outstanding using the treasury stock method. All share and per share data have been restated for the three-for-two stock split effected in the form of a stock dividend in January 1997. DEPRECIATION AND AMORTIZATION Depreciation is recorded using the straight-line method. The estimated useful lives used in computation of depreciation generally are as follows: Land improvements.....................................10 to 12 years Buildings and improvements............................ 3 to 30 years Machinery and equipment, tooling and engineering drawings............................. 3 to 12 years Office equipment, mobile equipment and motor vehicles......................... 3 to 10 years Identifiable intangible assets are amortized over their estimated useful lives using the straight-line method. The cost in excess of net assets acquired is amortized on a straight-line basis over a period of 30 to 40 years. The carrying amount of all long-lived assets is evaluated annually to determine if adjustment to the depreciation and amortization period or to the unamortized balance is warranted. USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 2. SUPPLEMENTAL CASH FLOW INFORMATION A summary of supplemental cash flow information follows:
1996 1995 1994 ---- ---- ---- Cash paid for - Interest.................................... $ 17,363 $ 15,303 $ 12,007 Income taxes................................ 23,857 21,793 16,608 Noncash investing activities - Liabilities assumed in connection with acquisition of businesses: Fair value of assets acquired.............. $ 51,055 $ 50,218 $ 47,187 Cost in excess of net assets acquired....................... 101,473 34,386 63,069 Cash paid.................................. (132,584) (69,760) (91,558) Common stock issued in connection with acquisitions.............................. (2,271) ------- ------- ------- Liabilities assumed........................... $ 17,673 $ 14,844 $ 18,698 ======= ======= =======
3. BALANCE SHEET COMPONENTS The components of inventories as of December 31, 1996 and 1995 were:
1996 1995 ---- ---- Raw materials..................................... $16,946 $ 13,978 Work in process................................... 14,909 15,434 Finished goods.................................... 65,661 71,640 ------- -------- Total.......................................... $97,516 $101,052 ======= ========
Those inventories which were carried on a LIFO basis amounted to $62,068 and $57,409 at December 31, 1996 and 1995, respectively. The excess of current cost over LIFO inventory value and the impact on earnings of using the LIFO method are not material. 24 29 [IDEX LOGO] The components of certain other balance sheet accounts as of December 31, 1996 and 1995 were:
1996 1995 -------- -------- Receivables Customers.................................. $ 88,838 $ 71,424 Other...................................... 4,749 1,073 -------- -------- Total..................................... 93,587 72,497 Less allowance for doubtful accounts....... 2,387 2,159 -------- -------- Receivables - net......................... $ 91,200 $ 70,338 ======== ======== Property, plant and equipment, at cost Land and improvements...................... $ 8,090 $ 8,836 Buildings and improvements................. 55,988 51,708 Machinery and equipment.................... 139,769 130,518 Engineering drawings....................... 9,592 9,383 Office equipment........................... 21,857 16,074 Mobile equipment and motor vehicles 2,294 2,353 Construction in progress................... 1,058 2,386 -------- -------- Total..................................... 238,648 221,258 Less accumulated depreciation and amortization.......................... 136,265 129,980 -------- -------- Property, plant and equipment - net....... $102,383 $ 91,278 ======== ======== Intangible assets Cost in excess of net assets acquired...... $282,972 $186,928 Other...................................... 28,904 26,283 -------- -------- Total..................................... 311,876 213,211 Less accumulated amortization.............. 37,365 28,994 -------- -------- Intangible assets - net................... $274,511 $184,217 ======== ======== Accrued expenses Accrued payroll and related items.......... $ 22,088 $ 20,229 Accrued taxes.............................. 6,308 7,537 Accrued insurance.......................... 2,959 2,555 Other accrued liabilities.................. 17,361 12,580 -------- -------- Total..................................... $ 48,716 $ 42,901 ======== ======== Other noncurrent liabilities Pension and retiree medical reserves....... $ 15,182 $ 15,078 Lease obligations.......................... 2,265 2,328 Other noncurrent liabilities............... 6,251 8,779 -------- -------- Total..................................... $ 23,698 $ 26,185 ======== ========
4. LEASE COMMITMENTS At December 31, 1996, total minimum rental payments under noncancelable operating leases, primarily for office facilities, warehouses and data processing equipment, were $20.4 million. The future minimum rental commitments for each of the next five years are as follows: 1997 -- $4.8 million; 1998 -- $3.7 million; 1999 -- $2.9 million; 2000 -- $2.3 million; 2001 - -- $1.6 million; threafter -- $5.1 million. Rental expense totaled $5.9 million, $4.8 million and $4.4 million for the years ended December 31, 1996, 1995 and 1994, respectively. 5. RETIREMENT BENEFITS The Company has a number of noncontributory defined benefit and defined contribution pension plans covering substantially all employees, other than certain bargaining unit employees who participate in a multiemployer pension plan. The defined benefit plans covering salaried employees provide pension benefits that are based on compensation over an employee's full career. The defined benefit plans covering hourly employees and bargaining unit members generally provide benefits of stated amounts for each year of service. The Company's funding policy for these plans is to fund benefits as accrued within the minimum and maximum limitations of the Internal Revenue Code. The defined contribution plans provide for annual contributions to individuals' accounts. The level of the contribution is generally a percent of salary based on age and years of service. Pension costs for the years ended December 31, 1996, 1995 and 1994 included the following components:
1996 1995 1994 ------ ------ ------ Service cost -- benefits earned during the period................ $ 3,200 $ 2,214 $ 2,382 Interest cost on projected benefit obligation............... 4,112 2,908 2,874 Actual return on assets........... (8,509) (8,172) 1,621 Net amortization and deferral..... 4,997 5,407 (4,177) ------- ------- ------- Net periodic pension cost........ 3,800 2,357 2,700 Contributions to multiemployer plan, defined contribution plans and other.................. 3,538 2,780 2,495 ------- ------- ------- Total pension costs............. $ 7,338 $ 5,137 $ 5,195 ======= ======= ======= Assumptions used in accounting for pension costs at December 31, were: Assumed discount rate ............ 7.50% 7.25% 8.50% Assumed rate of compensation increase for salaried plans............... 4.0 % 4.0 % 4.0 % Expected rate of return on plan assets...................... 9.0 % 8.0 % 8.0 %
25 30 The funded status of the defined benefit plans and amounts recognized in the Company's consolidated balance sheets at December 31, 1996 and 1995 are presented below:
U.S. PLANS NON-U.S. ------------ -------- ASSETS ACCUMULATED ACCUMULATED EXCEED BENEFITS BENEFITS ACCUMULATED EXCEED EXCEED BENEFITS ASSETS ASSETS ----------- ------- ------- DECEMBER 31, 1996 Actuarial present value of benefit obligations Vested benefit obligation......................... $34,543 $ 9,722 $ 8,471 ======= ======= ======= Accumulated benefit obligation.................... $37,871 $10,395 $ 8,504 ======= ======= ======= Projected benefit obligation....................... $44,433 $10,522 $ 8,892 Plan assets at fair value (1)...................... 43,807 4,816 4,196 ------- ------- ------- Projected benefit obligation in excess of plan assets.......................... (626) (5,706) (4,696) Prior service cost not yet recognized.............. 3,217 572 Unrecognized net obligaton at date of transition (2)............................ (1,071) 691 Unrecognized net (gain) loss....................... (1,741) 1,594 (365) ------- ------- ------- Pension liability................................. $ (221) $(2,849) $(5,061) ======= ======= ======= DECEMBER 31, 1995 Actuarial present value of benefit obligations Vested benefit obligation......................... $24,539 $ 8,685 $ 8,017 ======= ======= ======= Accumulated benefit obligation.................... $26,279 $ 9,407 $ 8,017 ======= ======= ======= Projected benefit obligation....................... $37,413 $ 9,719 $ 8,315 Plan assets at fair value (1)...................... 37,967 3,644 3,286 ------- ------- ------- Projected benefit obligation less than (in excess of) plan assets........................ 554 (6,075) (5,029) Prior service cost not yet recognized.............. 2,101 433 Unrecognized net obligaton at date of transition (2)............................ (1,292) 720 Unrecognized net (gain) loss....................... (659) 2,253 (326) ------- ------- ------- Pension liability................................. $ 704 $(2,669) $(5,355) ======= ======= =======
(1) Primarily listed stocks and publicly traded fixed income securities. (2) Amortized by plan over the greater of the average remaining service period of the employee workforce of 15 years. 6. POSTRETIREMENT HEALTH CARE AND LIFE INSURANCE BENEFITS The Company provides health care and life insurance benefits to certain retired employees, their covered dependents and beneficiaries. The Company provides for the estimated cost of such retiree benefit payments during the employee's active service period. Net periodic postretirement expense for 1996, 1995 and 1994 includes the following components:
1996 1995 1994 ---- ---- ---- Service cost -- benefits earned during the period..................... $ 310 $ 264 $341 Interest cost on accumulated postretirement benefit obligation 528 582 655 Net amortization and deferral.......... (272) (260) (66) ----- ----- ---- Total cost............................ (566) $ 586 $930 ===== ===== ====
The Company's postretirement benefit plans are not funded. The accumulated postretirement benefit obligation (APBO) of the plans at December 31, 1996 and 1995 is as follows:
1996 1995 ------- ------- Retirees............................... $ 2,595 $ 3,069 Fully eligible active participants..... 651 797 Other active participants.............. 5,123 4,974 ------- ------- Total APBO............................ 8,369 8,840 Unrecognized gain...................... 1,838 1,149 ------- ------- Accrued postretirement health care costs.................... $10,207 $ 9,989 ======= =======
For measurement purposes, a 12% annual rate of increase in the cost of covered health care benefits was assumed for 1996, gradually declining to 6% by the year 2008 and remaining at that level thereafter. The health care trend rate assumption has a significant effect on the amount of the obligation and the net periodic cost reported. An increase or decrease of the trend rate of 1% would change the accumulated postretirement benefit obligation as of December 31, 1996 by $1.2 million and the net periodic cost for this year by $.1 million. The assumed discount rate used in determining the accumulated postretirement benefit obligation was 7.5% in 1996 and 7.25% in 1995. 7. LONG-TERM DEBT Long-term debt at December 31, 1996 and 1995 consisted of the following:
1996 1995 -------- -------- Bank revolving credit facilities, including accrued interest........ $196,709 $131,184 9-3/4% Senior Subordinated Notes.... 75,000 75,000 -------- -------- Long-term debt.................... $271,709 $206,184 ======== ========
In July 1996 the Company entered into a multicurrency amended and restated domestic bank revolving credit facility (the "U.S. Agreement") increasing the maximum availability to $250 million and improving the interest rate structure. The availability under the U.S. Agreement declines in stages commencing July 1, 1999, to $200 million at July 1, 2000. Any amount outstanding at July 1, 2001, becomes due at that date. At December 31, 1996, $160.1 million of the maximum availability was being used, including a Netherlands guilder borrowing of 82.0 million ($47.1 million). Interest on the outstanding borrowings under the U.S. Agreement is payable quarterly at a rate based on the bank agent's reference rate or, at the Company's election, at a rate based on LIBOR plus 50 basis points per annum. The weighted average interest rate on outstanding borrowings under the U.S. Agreement was 6.0% at December 31, 1996. A facility fee equal to 15 basis points per annum is payable quarterly on the entire $250 million available under the U.S. Agreement. In July 1996 IDEX borrowed $133 million under the U.S. Agreement to finance the acquisition of the Fluid Management (see Note 13). In September 1996 the Company entered into a $10 million demand line of credit expiring on June 1, 1997, for short-term borrowing requirements at the bank agent's reference rate, or at an optional rate based on the bank's cost of funds. At December 31, 1996, there were no borrowings under this short-term line of credit. 26 31 [IDEX LOGO] A DM 52.5 million ($34.1 million) credit facility (the "German Agreement"), entered into by Lukas Hydraulik GmbH KG and guaranteed by IDEX, declines in stages commencing November 1, 1997, to DM 31.3 million at November 1, 2000. Any amount outstanding at November 1, 2001, becomes due at the date. At December 31, 1996, DM 50.0 million ($32.5 million) was being used. Interest is payable quarterly on the outstanding balance at LIBOR plus 100 basis points per annum. Total long-term debt outstanding at December 31, 1996 and 1995 includes $4.2 million and $3.2 million, respectively, of accrued interest as interest is generally paid through borrowings under the U.S. Agreement. Borrowings under the U.S. Agreement are guaranteed jointly and severally by certain of the Company's subsidiaries and secured by a pledge of their stock and intercompany notes. The Company's $75 million of Senior Subordinated Notes ("Notes") due 2002 are jointly and severally guaranteed by certain of the Company's subsidiaries and are subordinated to the U.S. Agreement. Interest is payable semiannually at the rate of 9-3/4% per annum. The Notes are payable in annual installments of $18.75 million commencing in 2000 and are redeemable at various premiums by the Company commencing in 1997. At December 31, 1996, the fair market value of the Notes is approximately $78 million based on the quoted market price. The U.S. Agreement and the Indenture for the Notes permit the payment of cash dividends only to the extent that no default exists under such agreements and limit the amount of such dividends in accordance with specified formulas. At December 31, 1996, cash available for dividends on common stock for 1997 is limited to approximately $54.3 million under the most restrictive of these provisions. 8. CONTINGENCIES The Company is involved in certain litigation arising in the ordinary course of business. None of these matters is expected to have a material adverse effect on the Company's financial position or results of operations. However, the ultimate resolution of these matters could result in a change in the Company's estimates of its liability for these matters. 9. COMMON AND PREFERRED STOCK On December 19, 1996, the Company's Board of Directors authorized a three-for-two common stock split to be effected in the form of a 50% stock dividend payable on January 31 1997, to shareholders of record on January 15, 1997. Par value of common stock remained at $.01 per share. Shareholders' equity has been restated to give retroactive recognition to the stock split for all periods presented by reclassifying from additional paid-in capital to common stock the par value for the additional shares arising from the split. All references in the financial statements to number of shares, per share amounts and market prices of the Company's common stock have been restated. At December 31, 1996 and 1995, the Company had five million shares of preferred stock authorized but unissued. 10. STOCK OPTIONS The Company has stock option plans providing for the grant of options to purchase common shares to outside directors, executives and certain key employees using the intrinsic value method. Accordingly, no compensation cost has been recognized. In October 1995, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation" which the Company adopted in 1996. The Company retained the intrinsic value method of accounting for stock based compensation expense with certain additional disclosures as allowed by the statement. Had compensation cost been determined using the fair value method the Company's net income and earnings per common share (EPS) would have been as follows:
1996 1995 ------- ------- ~~Net income As reported $50,198 $45,325 Pro forma 49,312 45,022 Primary EPS As reported 1.69 1.53 Pro forma 1.66 1.52~~
The fair value of each option grant was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions for 1996 and 1995, respectively: dividend yield of 1.7% and 1.86%; volatility of 28.6% and 29.7%; risk-free interest rates of 6.2% and 6.9%; and expected lives of 5-1/2 years. The Compensation Committee of the Board of Directors administers the plans and approves stock option grants. The Company may grant options for up to five million shares. Stock options granted under the plans are exercisable at a price equal to the market value of the stock at the date of grant. The options become exercisable from one to five years from the date of grant and generally expire 10 years from the date of grant. The following table summarizes option activity under the plans:
Weighted Number Average of Option Price Options Per Share --------- ---------- Outstanding at December 31,1993 1,316,280 $ 7.18 Granted........................................ 437,738 16.57 Exercised...................................... (39,434) 3.37 Forfeited ..................................... (87,120) 12.40 --------- Outstanding at December 31, 1994 1,627,464 9.52 Granted........................................ 336,600 20.08 Exercised...................................... (77,461) 10.45 Forfeited ..................................... (31,995) 14.51 --------- Outstanding at December 31, 1995 1,854,608 11.27 Granted........................................ 442,875 25.56 Exercised...................................... (116,891) 6.32 Forfeited ..................................... (45,900) 20.63 --------- Outstanding at December 31, 1996................ 2,134,692 14.27 ========== Exercisable at December 31, 1994................ 625,606 3.50 ========== Exercisable at December 31, 1995................ 786,576 5.59 ========== Exercisable at December 31, 1996................ 953,482 8.38 ==========
27 32 The following table summarizes information about options outstanding at December 31, 1996:
Options Outstanding Options Exercisable ---------------------------------- ---------------------- Weighted Average Weighted Weighted Range of Remaining Average Average Exercise Number Life of Exercise Number Exercise Prices Outstanding Contract Price Exercisable Price - --------- ----------- --------- -------- ------------ -------- $ 0 to 7 447,014 1.7 years $ 1.26 447,014 $ 1.26 8 to 19 962,835 6.6 years 13.56 437,978 13.75 20 to 28 724,843 8.9 years 23.25 68,490 20.50 --------- ------- $ 0 to 28 2,134,692 6.4 years $14.27 953,482 $ 8.38 ========= =======
11. BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION IDEX consists of two business segments: Fluid Handling and Industrial Products. No single customer accounted for more than 2% of consolidated sales. Segment information for the years ended December 31, 1996, 1995 and 1994 is presented under "Management's Discussion and Analysis of Financial Condition and Results of Operations. Information about the Company's operations in different geographical regions for the years ended December 31, 1996, 1995 and 1994 is shown below. The Company's primary areas of operation outside the U.S. include North America, Europe and the Far East.
1996 1995 1994 -------- -------- -------- Sales North America................ $426,747 $401,654 $342,695 Europe....................... 130,042 80,415 52,323 Other........................ 5,762 5,267 4,484 -------- -------- -------- Total...................... $562,551 $487,336 $399,502 ======== ======== ======== Income from operations North America................ $ 77,134 $ 73,724 $ 57,125 Europe....................... 20,296 11,528 7,434 Other........................ 875 986 979 -------- -------- -------- Total...................... $ 98,305 $ 86,238 $ 65,538 ======== ======== ======== Identifiable assets North America................ $415,854 $357,393 $315,219 Europe....................... 160,161 106,457 53,580 Other........................ 7,758 2,272 2,297 -------- -------- -------- Total...................... $583,773 $466,122 $371,096 ======== ======== ========
Export sales from the U.S. for the years ended December 31, 1996, 1995 and 1994 were to the following geographical areas:
1996 1995 1994 -------- -------- -------- North America....... $ 22,055 $ 20,537 $ 21,911 South America....... 13,627 8,947 6,009 Europe.............. 12,358 10,339 8,068 Far East............ 21,928 21,952 12,347 Other............... 17,950 15,247 15,413 -------- -------- -------- Total............. $ 87,918 $ 72,022 $ 63,748 ======== ======== ========
12. INCOME TAXES Pretax income for the years ended December 31, 1996, 1995 and 1994 was taxed under the following jurisdictions:
1996 1995 1994 -------- -------- -------- Domestic............... $ 59,104 $ 56,969 $ 45,263 Foreign................ 19,750 14,074 7,253 -------- -------- -------- Total................ $ 78,854 $ 71,043 $ 52,516 ======== ======== ========
The provision for income taxes for the years ended December 31, 1996, 1995 and 1994 was as follows: Current U.S. ................ $ 17,657 $ 19,369 $ 13,007 State and local...... 1,398 1,326 841 Foreign.............. 4,127 2,726 2,550 -------- -------- -------- Total current....... 23,182 23,421 16,398 -------- -------- -------- Deferred U.S. ................ 2,884 438 2,579 State and local...... 125 (189) 537 Foreign.............. 2,465 2,048 (608) -------- -------- -------- Total deferred...... 5,474 2,297 2,508 -------- -------- -------- Total provision for income taxes...... $ 28,656 $ 25,718 $ 18,906 ======== ======== ========

Deferred (prepaid) income taxes result from the following:
1996 1995 1994 -------- -------- -------- Employee and retiree benefit plans......... $ 147 $ 228 $ 61 Depreciation and amortization.......... 1,195 474 1,284 Inventories............ 699 (607) 636 Allowances and accruals 4,053 1,785 (262) Financing.............. (100) (86) 1,041 Other.................. (520) 503 (252) -------- -------- -------- Total deferred tax provision $5,474 $ 2,297 $ 2,508 ======== ======== ========
28 33 [IDEX LOGO] Deferred tax assets (liabilities) comprise the following at December 31, 1996 and 1995:
1996 1995 ------- -------- Employee and retiree benefit plans........................ $ 6,769 $ 6,839 Depreciation and amortization.......... (10,284) (9,089) Inventories............................ (536) (170) Allowances and accruals................ 5,970 8,898 Financing.............................. (312) (412) Other.................................. (330) (832) -------- -------- Total................................ $ 1,277 $ 5,234 ======== ========
The consolidated balance sheets at December 31, 1996 and 1995 include current deferred tax assets of $4,835 and $7,045, respectively, classified as "Deferred taxes" and noncurrent deferred tax liabilities of $3,558 and $1,811, respectively, included in "Other noncurrent liabilities." The total income tax provision differs from the amount computed by applying the statutory federal income tax rate to pretax income. The computed amount and the differences for the years ended December 31, 1996, 1995 and 1994 were as follows:
1996 1995 1994 ------ ------- ------ Pretax income....................... $78,854 $71,043 $52,516 ======= ======= ======= Income tax provision: Computed amount at statutory rate of 35%........................... $27,599 $24,865 $18,381 Foreign sales corporation....................... (1,091) (918) (657) Amortization of cost in excess of net assets acquired................... 932 904 670 State and local income tax........................ 1,523 1,137 1,378 Other-net .......................... (307) (270) (866) ------- ------- ------- Total income tax provision........................ $28,656 $25,718 $18,906 ======= ======= =======
No provision has been made for U.S. or additional foreign taxes on $12.8 million of undistributed earnings of foreign subsidiaries which are permanently reinvested. It is not practical to estimate the amount of additional tax which might be payable if these earnings were repatriated. However, the Company believes that U.S. foreign tax credits would, for the most part, eliminate any aditional U.S. tax and offset any additional foreign tax. 13. ACQUISITION OF FLUID MANAGEMENT LIMITED PARTNERSHIP On July 29, 1996, IDEX purchased substantially all of the net operating assets of Fluid Management Limited Partnership ("FMLP"), a leading worldwide manufacturer of dispensing and mixing equipment for paints, coatings, inks, colorants and dyes. The $135 million purchase price was financed through a borrowing under the U.S. Agreement and the issuance of 113,550 shares of IDEX common stock. The excess of the purchase price over the fair market value of net assets acquired of approximately $101.5 million is being amortized over 30 years. The acquisition has been accounted for by the purchase method of accounting. The unaudited pro forma consolidated results of operations for the years ended December 31, 1996 and 1995, reflecting the allocation of the purchase price an related financing of the transactions would have been as follows, assuming that the FMLP acquisition had occurred at the beginning of each of the respective periods.
1996 1995 -------- -------- ~~Net sales..................... $610,862 $572,954 Net income.................... 51,048 47,235 Primary EPS................... 1.71 1.59~~
FMLP's financial performance for the period January 1 to July 29, 1996, prior to the acquisition was adversely affected by volume-related profit declines in Europe and startup costs associated with major new product introductions. 14. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) The following is a summary of the unaudited quarterly results of operations for the years ended ecember 31, 1996 and 1995:
QUARTER ------------------------------------------------------ FIRST SECOND THIRD FOURTH ----- ------ ----- ------ DECEMBER 31, 1996 Net Sales........................... $133,886 $131,169 $140,864 $156,632 Gross profit........................ 51,664 51,053 54,368 59,069 Income from operations........................ 23,416 23,737 23,746 27,406 Net income.......................... 12,214 12,662 11,829 13,494 Earnings per common share...................... $ .41 $ .43 $ .40 $ .45 Weighted average shares outstanding................ 29,726 29,735 29,735 29,711 DECEMBER 31, 1995 Net Sales........................... $116,580 $127,203 $116,807 $126,746 Gross profit........................ 45,073 49,173 44,897 48,878 Income from operations........................ 20,474 23,147 20,369 22,248 Net income.......................... 10,762 12,319 10,681 11,563 Earnings per common share...................... $ .37 $ .42 $ .36 $ .39 Weighted average shares outstanding................ 29,436 29,552 29,762 29,750
29 34 INDEPENDENT AUDITORS' REPORT To the Board of Directors and Shareholders of IDEX Corporation We have audited the accompanying consolidated balance sheets of IDEX Corporation and its subsidiaries as of December 31, 1996 and 1995 and the related statements of consolidated operations, shareholders' equity, and cash flows for each of the three years in the period ended December 31, 1996. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such financial statements present fairly, in all material respects, the financial position of the Company and its subsidiaries at December 31, 1996 and 1995 and the results of their operations and their cash flows for each of the three years in the period ended December 31, 1996 in conformity with generally accepted accounting principles. [SIGNATURE OF Deloitte & Touche LLP] Deloitte & Touche LLP Chicago, Illinois January 21, 1997 MANAGEMENT REPORT IDEX Corporation's management is responsible for the fair presentation and consistency of all financial data included in this Annual Report in accordance with generally accepted accounting principles. Where necessary, the data reflect management's best estimates and judgments. Management also is responsible for maintaining a system of internal accounting controls with the objectives of providing reasonable assurance that IDEX's assets are safeguarded against material loss from unauthorized use or disposition and that authorized transactions are properly recorded to permit the preparation of accurate financial data. Cost benefit judgments are an important consideration in this regard. The effectiveness of internal controls is maintained by personnel selection and training, division of responsibilities, establishment and communication of policies, and ongoing internal review programs and audits. Management believes that IDEX's system of internal controls as of December 31, 1996 is effective and adequate to accomplish the above described objectives. [SIGNATURE OF Donald N. Boyce] Donald N. Boyce Chairman of the Board, President and Chief Executive Officer [SIGNATURE OF Frank J. Hansen] Frank J. Hansen Senior Vice President--Operations and Chief Operating Officer [SIGNATURE OF Wayne P. Sayatovic] Wayne P. Sayatovic Senior Vice President--Finance, Chief Financial Officer and Secretary Northbrook, Illinois January 21, 1997 30 35 BUSINESS UNITS [IDEX LOGO] [PHOTO] BAND-IT-IDEX, INC. 4799 Dahlia St. Denver, CO 80216 (303) 320-4555 P. PETER MERKEL, JR. President Age: 63 Years of Service: 24 [PHOTO] CORKEN, INC. 3805 N.W. 36th St. Oklahoma City, OK 73112 (405) 946-5576 JEFFREY L. HOHMAN President Age: 43 Years of Service: 6 [PHOTO] FLUID MANAGEMENT, INC. 1023 South Wheeling Rd. Wheeling, IL 60090 (847) 537-0880 DAVID T. WINDMULLER President Age: 39 Years of Service: 16 [PHOTO] FLUID MANAGEMENT EUROPE B.V. Hub Van Doorneweg 31 2171 KZ Sassenheim Netherlands 31-252-230604 LEENDERT HELLENBERG President- Europe & Asia Age: 51 Years of Service: 12 [PHOTO] HALE PRODUCTS, INC. 700 Spring Mill Ave. Conshohocken, PA 19428 (610) 825-6300 WADE H. ROBERTS, JR. President Age: 50 Years of Service: 6 - -------------------------------------------------------------------------------- [PHOTO] LUBRIQUIP, INC. 18901 Cranwood Pkwy. Warrensville Heights, OH 44128 (216) 581-2000 MARK W. BAKER President Age: 48 Years of Service: 18 [PHOTO] MICROPUMP, INC. 1402 N.E. 136th Ave. Vancouver, WA 98684 (306) 253-2008 JAMES R. FLUHARTY President Age: 53 Years of Service: 6 [PHOTO] PULSAFEEDER, INC. 2883 Brighton- Henrietta Town Line Rd. Rochester, NY 14623 (716) 292-8000 RODNEY L. USHER President Age: 51 Years of Service: 16 [PHOTO] SIGNFIX LIMITED Bath Rd., Upper Langford Bristol BS18 7DJ England 44(0)1934 852888 ROGER N. GIBBINS Managing Director Age: 51 Years of Service: 12 - -------------------------------------------------------------------------------- [PHOTO] STRIPPIT, INC. 12975 Clarence Center Rd. Akron, NY 14001 (716) 542-4511 JOHN P. SNOW President Age: 52 Years of Service: 20 [PHOTO] VIBRATECH, INC. 11980 Walden Ave. Alden, NY 14004 (716) 937-6600 RALPH N. YORIO President Age: 50 Years of Service: 10 [PHOTO] VIKING PUMP, INC. 406 State St. Cedar Falls, IA 50613 (319) 266-1741 JOHN L. MCMURRAY President Age: 46 Years of Service: 4 [PHOTO] WARREN RUPP, INC. 800 North Main St. Mansfield, OH 44902 (419) 524-8388 JEFFREY F. FEHR President Age: 45 Years of Service: 5 NOTE: Years of service includes periods prior to acquisition by IDEX. 31 36 CORPORATE OFFICERS AND DIRECTORS [PHOTO] From Left to Right: Wade H. Roberts, Jr., Douglas C. Lennox, P. Peter Merkel, Jr., Mark W. Baker, Donald N. Boyce, Frank J. Hansen, Wayne P. Sayatovic, Clinton L. Kooman, Jerry N. Derck CORPORATE OFFICERS DONALD N. BOYCE Chairman of the Board, President and Chief Executive Officer Age: 58 Years of Service: 27 FRANK J. HANSEN Senior Vice President - Operations and Chief Operating Officer Age: 55 Years of Service: 21 WAYNE P. SAYATOVIC Senior Vice President - Finance,Chief Financial Officer and Secretary Age: 50 Years of Service: 24 MARK W. BAKER Vice President - Group Executive Age: 48 Years of Service: 18 JERRY N. DERCK Vice President - Human Resources Age: 49 Years of Service: 4 P. PETER MERKEL, Jr. Vice President - Group Executive Age: 63 Years of Service: 24 WADE H. ROBERTS, JR. Vice President - Group Executive Age: 50 Years of Service: 6 CLINTON L. KOOMAN Controller Age: 53 Years of Service: 32 DOUGLAS C. LENNOX Treasurer Age: 44 Years of Service: 17 Member of: + Executive Committee * Audit Committee # Compensation Committee NOTE: Years of service for corporate officers includes periods prior to acquisition. DIRECTORS DONALD N. BOYCE + Chairman of the Board, President and Chief Executive Officer IDEX Corporation Northbrook, Illinois Age: 58 Years of Service: 9 RICHARD E. HEATH Partner Hodgson, Russ, Andrews, Woods & Goodyear Buffalo, New York Age: 66 Years of Service: 8 HENRY R. KRAVIS General Partner Kohlberg Kravis Roberts & Co. New York, New York Age: 52 Years of Service: 9 WILLIAM H. LUERS *# President Metropolitan Museum of Art New York, New York Age: 67 Years of Service: 8 PAUL E. RAETHER General Partner Kohlberg Kravis Roberts & Co. New York, New York Age: 50 Years of Service: 9 CLIFTON S. ROBBINS + General Partner Kohlberg Kravis Roberts & Co. New York, New York Age: 38 Years of Service: 9 GEORGE R. ROBERTS General Partner Kohlberg Kravis Roberts & Co. San Francisco, California Age: 53 Years of Service: 9 NEIL A. SPRINGER *# Managing Director Springer Souder & Assoc. L.L.C. Chicago, Illinois Age: 58 Years of Service: 7 MICHAEL T. TOKARZ + General Partner Kohlberg Kravis Roberts & Co. New York, New York Age: 47 Years of Service: 9 32 37 [IDEX LOGO] SHAREHOLDER INFORMATION CORPORATE EXECUTIVE OFFICES IDEX Corporation 630 Dundee Road Northbrook, Illinois 60062 (847) 498-7070 INVESTOR INFORMATION Shareholders and prospective investors are welcome to call or write with questions or requests for additional information. Please direct inquiries to: Wayne P. Sayatovic, Senior Vice President - Finance, Chief Financial Officer and Secretary. News releases and other background information are available at no charge by calling 1-800-758-5804, ext. 110769 for fax service, or under http://www.prnewswire.com on the Internet. REGISTRAR AND TRANSFER AGENT Inquiries about stock transfers or address changes should be directed to: Harris Trust and Savings Bank 311 West Monroe Street Chicago, Illinois 60690 (312) 461-2288 INDEPENDENT AUDITORS Deloitte & Touche LLP Two Prudential Plaza 180 North Stetson Avenue Chicago, Illinois 60601 DIVIDEND POLICY IDEX increased the quarterly dividend on its common stock beginning January 31, 1997 to $.12 per post-split share per calendar quarter, up 12.5% from last year's dividend. The declaration of future dividends is within the discretion of the Board of Directors and will depend upon, among other things, business conditions, earnings, and IDEX's financial condition. See Notes 7 and 9 of the Notes to Consolidated Financial Statements. STOCK MARKET INFORMATION IDEX common stock was held by 1,305 shareholders at December 31, 1996, and is traded on the New York Stock Exchange and the Chicago Stock Exchange under the ticker symbol IEX. FORM 10-K Shareholders may obtain a copy of the Form 10-K filed with the Securities and Exchange Commission by directing a request to IDEX. ANNUAL MEETING The Annual Meeting of IDEX Shareholders will be held on Tuesday, March 25, 1997 at 10:00 a.m. in the Shareholders Room of Bank of America Illinois, 231 South LaSalle Street, Chicago, Illinois 60697. STOCK HISTORY QUARTERLY CLOSING PRICES [BAR GRAPH] 1989 7.5 1990 4.75 1991 7.5 1992 10.5 1993 15.88 1994 18.75 1995 27.13
FIRST SECOND THIRD FOURTH QUARTERLY STOCK PRICE QUARTER QUARTER QUARTER QUARTER 1996 High 27 5/8 27 3/8 26 1/8 26 3/4 Low 24 1/4 25 19 7/8 22 Close 25 7/8 25 3/8 22 1/8 26 5/8 1995 High 20 5/8 23 1/8 29 1/2 28 7/8 Low 18 3/8 19 1/8 22 3/8 24 3/8 Close 19 7/8 22 3/8 23 7/8 27 1/8
33 38 [IDEX LOGO] IDEX CORPORATION 630 Dundee Road Northbrook, Illinois 60062

1 EXHIBIT 21 SUBSIDIARIES OF IDEX CORPORATION December 31, 1996
OTHER NAME JURISDICTION OF WHICH DOING BUSINESS SUBSIDIARY INCORPORATION IF ANY - ---------- --------------- -------------------- BAND-IT-IDEX, INC. DELAWARE BAND-IT COMPANY LTD. UNITED KINGDOM BAND-IT CLAMPS (ASIA) PTE. LTD. SINGAPORE CORKEN, INC. DELAWARE FMI MANAGEMENT COMPANY DELAWARE FLUID MANAGEMENT, INC. DELAWARE FLUID MANAGEMENT EUROPE B.V. NETHERLANDS FLUID MANAGEMENT U.K. LTD. UNITED KINGDOM FLUID MANAGEMENT FRANCE SARL FRANCE FLUID MANAGEMENT ESPNANA SLU SPAIN FLUID MANAGEMENT SCANDINAVIA AB SWEDEN FLUID MANAGEMENT GmbH GERMANY FLUID MANAGEMENT AUSTRALIA PTY.LTD. AUSTRALIA FLUID MANAGEMENT SERVICES, INC. FLUID MANAGEMENT CANADA CANADA FLUID MANAGEMENT SERVICOS e VENDES BRAZIL HALE PRODUCTS, INC. PENNSYLVANIA HALE PRODUCTS EUROPE GmbH GERMANY GODIVA PRODUCTS LTD. UNITED KINGDOM SEITHAL LIMITED UNITED KINGDOM GODIVA GROUP LTD. UNITED KINGDOM GINSWAT LTD. HONG KONG DUNJA GERMANY LUKAS HYDRAULIK GmbH GERMANY LUBRIQUIP, INC. DELAWARE KLS LUBRIQUIP, INC. WISCONSIN MICROPUMP, INC. DELAWARE MM HOLDING CO. DELAWARE CONSIS, LLC WASHINGTON MICROPUMP LIMITED UNITED KINGDOM PULSAFEEDER, INC. DELAWARE PULSAFEEDER PTE. LTD. SINGAPORE SIGNFIX HOLDINGS LIMITED UNITED KINGDOM SIGNFIX LIMITED UNITED KINGDOM TESPA FRANCE SARL FRANCE TESPA GmbH GERMANY STRIPPIT, INC. DELAWARE BURGMASTER STRIPPIT LIMITED UNITED KINGDOM STRIPPIT S.A. FRANCE VIBRATECH, INC. DELAWARE
2 SUBSIDIARIES OF IDEX CORPORATION December 31, 1996
OTHER NAME JURISDICTION OF WHICH DOING BUSINESS SUBSIDIARY INCORPORATION IF ANY - ---------- --------------- -------------------- VIKING PUMP, INC. DELAWARE VIKING PUMP INTERNATIONAL, INC. DELAWARE VIKING PUMP (EUROPE) LTD. IRELAND JOHNSON PUMP (UK) LTD. UNITED KINGDOM VIKING PUMP OF CANADA, INC. ONTARIO WARREN RUPP, INC. DELAWARE MARATHON PUMP COMPANY WARREN RUPP (EUROPE) LTD. IRELAND IDEX FOREIGN SALES CORP. BARBADOS

1 EXHIBIT 24 INDEPENDENT AUDITORS' CONSENT IDEX Corporation: We consent to the incorporation by reference in the Registration Statements (File Numbers 33-47678, 33-56586, 33-67688 and 333-18643) of IDEX Corporation on Form S-8 of our reports dated January 21, 1997, appearing in and incorporated by reference in the Annual Report on Form 10-K of IDEX Corporation for the year ended December 31, 1996. /S/Deloitte & Touche LLP - ----------------------------- Deloitte & Touche LLP Chicago, Illinois January 21, 1997

5 YEAR DEC-31-1996 DEC-31-1996 5,295 0 93,587 2,387 97,516 201,170 238,648 136,265 583,773 92,857 271,709 0 0 289 195,220 583,773 562,551 562,551 346,397 464,246 (509) 1,623 18,942 78,854 28,656 50,198 0 0 0 50,198 1.69 0