WISCONSIN
(State
or other jurisdiction of incorporation or organization)
|
39-0482000
(I.R.S.
Employer Identification No.)
|
1500
DeKoven Avenue, Racine, Wisconsin
(Address
of principal executive offices)
|
53403
(Zip
Code)
|
Title
of each class
Common
Stock, $0.625 par value
|
Name
of each exchange on which registered
New
York Stock Exchange
|
Incorporated
Document
|
Location
in Form 10-K
|
Proxy
Statement for the 2007 Annual
Meeting
of Shareholders
|
Part
III of Form 10-K
(Items
10, 11, 12, 13, 14)
|
Page
|
|||
Part
I
|
|||
Item
1
|
Business.
|
1-19
|
|
Item
1A
|
Risk
Factors.
|
19-22
|
|
Item
1B
|
Unresolved
Staff Comments.
|
23
|
|
Item
2
|
Properties.
|
23-24
|
|
Item
3
|
Legal
Proceedings.
|
24-25
|
|
Item
4
|
Submission
of Matters to a Vote of Security Holders.
|
25
|
|
Executive
Officers of the Registrant.
|
25-26
|
||
Part
II
|
|||
Item
5
|
Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities.
|
26-29
|
|
Item
6
|
Selected
Financial Data.
|
29-30
|
|
Item
7
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations.
|
30-57
|
|
Item
7A
|
Quantitative
and Qualitative Disclosures about Market Risk.
|
57-62
|
|
Item
8
|
Financial
Statements and Supplementary Data.
|
63-122
|
|
Item
9
|
Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure.
|
123
|
|
Item
9A
|
Controls
and Procedures.
|
123-124
|
|
Item
9B
|
Other
Information.
|
124
|
|
Part
III
|
|||
Item
10
|
Directors,
Executive Officers and Corporate Governance.
|
124-125
|
|
Item
11
|
Executive
Compensation.
|
125
|
|
Item
12
|
Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters.
|
125
|
|
Item
13
|
Certain
Relationships and Related Transactions, and Director
Independence.
|
125
|
|
Item
14
|
Principal
Accountant Fees and Services.
|
125
|
|
Part
IV
|
|||
Item
15
|
Exhibits
and Financial Statement Schedules.
|
126
|
|
Signatures
|
127-128
|
||
Financial
Statements
|
|||
Financial
Statement Schedule
|
|||
Report
of Independent Registered Public Accounting Firm
|
|||
Exhibit
Index
|
Net
earnings
|
$
|
42,332
|
||
Plus
interest expense, net of tax benefit at total Company effective
tax
rate
|
7,947
|
|||
Net
return
|
$
|
50,279
|
||
Divided
by:
|
||||
Average
capital (debt + equity, last five quarter ends / divided by
5)
|
$
|
697,391
|
||
Return
on average capital employed
|
7.2
|
%
|
||
Interest
expense
|
$
|
10,163
|
||
Total
company effective tax rate
|
21.8
|
%
|
||
Tax
benefit
|
2,216
|
|||
Interest
expense net of tax benefit
|
$
|
7,947
|
o |
We
implemented several actions aimed at reducing our annualized selling,
general and administrative expenses, including early retirement programs
in the U.S. and Korea and changes made to our corporate processes.
|
o |
We
began to reposition our global manufacturing footprint through the
announced closure of four plants in the U.S. and the announced plans
to
invest in four new plants in the lower-cost countries of China, Mexico,
Hungary and India.
|
o |
We
have implemented plans to increase our sourcing of purchased materials,
parts and equipment from low-cost countries to 20 percent of our
global
needs in fiscal 2008, and increasing to over 40 percent in several
years.
|
o |
We
announced several new technology developments, including a new idle-off
system for heavy trucks, a partnership with Bloom Energy for components
on
their fuel-cell power generation modules, and an Advanced Steam Methane
Reformer unit built in collaboration with Chevron Technology Ventures,
LLC
and BASF Catalysts LLC.
|
o |
We
introduced globally-focused product groups of Engine Products, Powertrain
Cooling Products, and Passenger Thermal Management Products to support
our
regional vehicular segment structure with one consistent product
support
structure that helps drive redundant costs out of our
organization.
|
o |
We
introduced standardized processes and systems at each of our manufacturing
plants through the Modine Production System, with the goal of creating
more manufacturing capacity with less capital investment.
|
Fiscal
2007
|
Fiscal
2006
|
||||||
Modules/Packages*
|
27
|
%
|
28
|
%
|
|||
Oil
Coolers
|
13
|
%
|
14
|
%
|
|||
Vehicular
Air Conditioning
|
13
|
%
|
14
|
%
|
|||
Radiators
|
14
|
%
|
11
|
%
|
|||
Charge-Air
Coolers
|
11
|
%
|
12
|
%
|
|||
Building
HVAC
|
9
|
%
|
9
|
%
|
|||
EGR
Coolers
|
8
|
%
|
9
|
%
|
|||
Miscellaneous
|
3
|
%
|
1
|
%
|
|||
Electronics
|
2
|
%
|
2
|
%
|
North
America
|
Europe
|
South
America
|
Africa
|
Asia/Pacific
|
Mexico
United
States
|
Austria
Germany
Hungary
Italy
France
The
Netherlands
United
Kingdom
|
Brazil
|
South
Africa
|
China
Japan
South
Korea
|
- |
Modine Manufacturing Company Guideline for Business Conduct, which
is
applicable to all Modine employees, including the principal executive
officer, the principal financial officer and the principal accounting
officer;
|
Location
of Facility
|
Building
Space and Primary Use
|
Owned
or
Leased
|
Original
Equipment - Americas Segment
|
||
Sao
Paulo, Brazil
|
336,000
sq. ft./manufacturing
|
Owned
|
Harrodsburg,
KY
|
263,500
sq. ft./manufacturing
|
Owned
|
Clinton,
TN
|
194,100
sq. ft./manufacturing
|
Owned
|
Pemberville,
OH
|
186,863
sq. ft./manufacturing
|
Owned
|
McHenry,
IL
|
164,700
sq. ft./manufacturing
|
Owned
|
Jefferson
City, MO
|
162,000
sq. ft./manufacturing
|
Owned
|
Trenton,
MO
|
159,948
sq. ft./manufacturing
|
Owned
|
Washington,
IA
|
148,800
sq. ft./manufacturing
|
Owned
|
Lawrenceburg,
TN
|
143,800
sq. ft./manufacturing
|
Owned
|
Joplin,
MO
|
142,300
sq. ft./manufacturing
|
Owned
|
Logansport,
IN
|
141,600
sq. ft./manufacturing
|
Owned
|
Jackson,
MS
|
138,914
sq. ft./manufacturing
|
Owned
|
Camdenton,
MO
|
128,000
sq. ft./manufacturing
|
Owned
|
Richland,
SC
|
114,900
sq. ft./held for sale
|
Owned
|
Toledo,
OH
|
50,900
sq. ft./assembly
|
Leased
|
Original
Equipment - Asia Segment
|
||
Asan
City, South Korea
|
559,110
sq. ft./manufacturing & technical center
|
Owned
|
Shanghai,
China
|
64,583
sq. ft./manufacturing
|
Leased
|
Original
Equipment - Europe Segment
|
||
Wackersdorf,
Germany
|
344,363
sq. ft./assembly
|
Owned
|
Bonlanden,
Germany
|
262,241
sq. ft./corporate & technology center
|
Owned
|
Pontevico,
Italy
|
153,007
sq. ft./manufacturing
|
Owned
|
Berndorf,
Austria
|
145,744
sq. ft./manufacturing
|
Leased
|
Tübingen,
Germany
|
126,430
sq. ft./manufacturing
|
Owned
|
Pliezhausen,
Germany
|
122,449
sq. ft./manufacturing
|
49,819
Owned; 72,630 Leased
|
Kirchentellinsfurt,
Germany
|
107,600
sq. ft./manufacturing
|
Owned
|
Mezökövesd,
Hungary
|
90,481
sq. ft./manufacturing
|
Owned
|
Neuenkirchen,
Germany
|
76,396
sq. ft./manufacturing
|
Owned
|
Uden,
Netherlands
|
61,870
sq. ft./manufacturing
|
Owned
|
Commercial
HVAC&R Segment
|
||
Leeds,
United Kingdom
|
269,100
sq. ft./corporate & manufacturing
|
Leased
|
Buena
Vista, VA
|
214,600
sq. ft./manufacturing
|
Owned
|
Nuevo
Laredo, Mexico
|
198,500
sq. ft./manufacturing
|
Owned
|
Lexington,
VA
|
104,000
sq. ft./warehouse
|
Owned
|
West
Kingston, RI
|
92,800
sq. ft./manufacturing
|
Owned
|
Laredo,
TX
|
22,000
sq. ft./warehouse
|
Leased
|
Corporate
Headquarters and Other Segment
|
||
Racine,
WI
|
458,000
sq. ft./headquarters & technical center
|
Owned
|
Lancaster,
PA
|
60,000
sq. ft./corporate & manufacturing
|
Leased
|
Ashington,
United Kingdom
|
22,000
sq. ft./manufacturing
|
Leased
|
Current
Executive Officers of Registrant
|
|||
Name
|
Age
|
Position
|
Officer
Since
|
David
B. Rayburn
|
59
|
President
and Chief Executive Officer; Director
|
1991
|
Thomas
A. Burke
|
50
|
Executive
Vice President and Chief Operating Officer
|
2005
|
Bradley
C. Richardson
|
48
|
Executive
Vice President, Finance and Chief Financial Officer
|
2003
|
Charles
R. Katzfey
|
60
|
Regional
Vice President - Americas
|
2000
|
Klaus
A. Feldmann
|
53
|
Regional
Vice President - Europe
|
2000
|
James
R. Rulseh
|
52
|
Regional
Vice President - Asia
|
2001
|
Dean
R. Zakos
|
53
|
Vice
President, General Counsel and Secretary
|
1985
|
Anthony
C. DeVuono
|
58
|
Vice
President and Chief Technology Officer
|
1996
|
2007
|
2006
|
||||||
Quarter
|
High
|
Low
|
Dividends
|
High
|
Low
|
Dividends
|
|
First
|
$29.99
|
$21.90
|
$
.1750
|
$33.53
|
$26.45
|
$
.1750
|
|
Second
|
24.98
|
20.68
|
.1750
|
37.38
|
31.93
|
.1750
|
|
Third
|
25.29
|
22.62
|
.1750
|
37.98
|
31.44
|
.1750
|
|
Fourth
|
28.00
|
22.65
|
.1750
|
34.10
|
25.20
|
.1750
|
|
TOTAL
|
$
.7000
|
$
.7000
|
Period
|
(a)
Total
Number of Shares (or Units) Purchased
|
(b)
Average
Price
Paid
Per
Share
(or
Unit)
|
(c)
Total
Number of Shares (or Units) Purchased as Part of Publicly
Announced
Plans or Programs
|
(d)
Maximum
Number
(or
Approximate
Dollar
Value)
of Shares
(or
Units) that May Yet Be Purchased Under the Plans or
Programs
|
December
27, 2006 - January 26, 2007
|
20,212
(1)
|
$25.90
(2)
|
———
|
2,445,169
(3)
|
|
|
|
|
|
January
27 - February 26, 2007
|
3,316
(1)
|
$26.25
(2)
|
———
|
2,445,169
(3)
|
|
|
|
|
|
February
27 - March 31, 2007
|
156
(1)
|
$25.40
(2)
|
———
|
2,445,169
(3)
|
|
|
|
|
|
Total
|
23,684
(1)
|
$25.95
(2)
|
———
|
|
INDEXED
RETURNS
|
||||||
Base
|
Years
Ending
|
|||||
Period
|
||||||
Company
/ Index
|
3/31/02
|
3/31/03
|
3/31/04
|
3/31/05
|
3/31/06
|
3/31/07
|
Modine
|
100
|
56.95
|
101.22
|
116.24
|
124.60
|
99.57
|
Russell
2000 Index
|
100
|
73.04
|
119.66
|
126.13
|
158.73
|
168.11
|
S&P
Midcap 400 Industrials Index
|
100
|
75.90
|
109.40
|
122.29
|
162.91
|
171.92
|
(in
thousands, except per share amounts)
|
Fiscal
Year ended March 31
|
|||||||||||||||
2007
|
2006
|
2005
|
2004
|
2003
|
||||||||||||
Net
sales
|
$
|
1,757,472
|
$
|
1,628,900
|
$
|
1,342,416
|
$
|
980,675
|
$
|
862,989
|
||||||
Earnings
from continuing operations
|
42,262
|
60,752
|
61,686
|
35,493
|
33,388
|
|||||||||||
Total
assets
|
1,101,573
|
1,052,095
|
1,152,155
|
976,523
|
907,221
|
|||||||||||
Long-term
debt - excluding current portion
|
175,856
|
151,706
|
40,724
|
84,885
|
98,556
|
|||||||||||
Dividends
per share
|
0.70
|
0.70
|
0.63
|
0.55
|
0.50
|
|||||||||||
Net
earnings from continuing operations per share of common stock
-
basic:
|
1.32
|
1.80
|
1.81
|
1.05
|
0.99
|
|||||||||||
Net
earnings from continuing operations per share of common stock
-
diluted:
|
1.31
|
1.78
|
1.79
|
1.04
|
0.99
|
· |
During
fiscal 2007, the Company completed the acquisition of the remaining
50
percent of Modine Brazil. During fiscal 2006 and 2005, the Company
completed the acquisitions of Airedale International Air Conditioning
Limited, the heavy-duty original equipment business of Transpro,
Inc. and
the South Korean and Chinese assets of the Automotive Climate Control
Division of WiniaMando Inc. Refer to Note 12 of the Notes to Consolidated
Financial Statements for additional discussion of these
acquisitions.
|
· |
During
fiscal 2007, the Company’s effective tax rate was a benefit of 7.6 percent
versus a provision of 32.9 percent in the prior year. Refer to Note
6 of
the Notes to Consolidated Financial Statements for additional discussion
on the effective tax rate.
|
· |
During
fiscal 2007, the Company incurred $13.2 million of restructuring
and other
repositioning costs. Refer to Note 14 of the Notes to Consolidated
Financial Statements for additional discussion of the events which
comprised these costs.
|
· |
During
fiscal 2007, the Company adopted Statement of Financial Accounting
Standard (SFAS) No. 123(R), “Share-Based Payment”. Refer to Note 23 of the
Notes to Consolidated Financial Statements for additional discussion
of
the impact of this adoption.
|
· |
During
fiscal 2007, the Company adopted SFAS No. 158, “Employer’s Accounting for
Defined Benefit Pension and Other Postretirement Plans, an amendment
of
FASB Statement Nos. 87, 88, 106 and 132(R)”. Refer to Note 3 of the Notes
to Consolidated Financial Statements for additional discussion of
the
impact of this adoption.
|
· |
Development
of new products and technologies for diverse end
markets;
|
· |
A
rigorous strategic planning and corporate development process;
and,
|
· |
Operational
and financial discipline for improved profitability and long-term
stability.
|
o |
Reduce
selling, general and administrative expenses
(SG&A).
With a goal of reducing annualized SG&A expense, we took several
actions this year, including changing our corporate processes to
reduce
waste and increase speed. We also took several actions to reduce
expenses
in the U.S. and Korea through early retirement programs. There is more to
be done in fiscal 2008, but we accomplished the majority of what
we set
out to do in this area. This should help improve operating margins
when
completed.
|
o |
Reposition
our global manufacturing footprint. We
announced the closure of four plants in higher cost areas of the
world and
announced plans to invest in four new plants in low cost countries,
including expansion in China, Mexico, Hungary and India. While there
will
be duplicative costs over the next two to three years as the process
rolls
out, when the process is completed, we will compete for new business
from
a much improved cost competitive position with increased asset utilization
across the platform. This process should benefit the company at both
the
gross and operating margin level and help us win incremental profitable
business. As part of this repositioning process, we also exited the
Taiwan
operation of the electronics cooling business during fiscal 2007
which was
an extremely competitive market with relatively low margins. The
decision
to exit this business supports our repositioning plan toward improved
operating margins as this business has historically generated operating
losses.
|
o |
Purchase
and source from low cost countries. Early
in fiscal 2007 Modine sourced only 10 percent of its materials, parts
and
equipment from low-cost countries. We now have the leadership and
strategy
in place to source up to 20 percent of our needs from lower cost
areas in
2008, increasing to over 40 percent in several years. This is a critical
element to the plan, as it’s designed to improve our variable cost
position over time.
|
o |
Increased
focus on technology development.
We
announced several new technology developments and partnerships this
year
including:
|
o |
A
new idle-off system for heavy trucks which ensures comfort for resting
drivers without requiring the engine to idle. Powered by a fuel cell
auxiliary power unit, the system uses CO2
air conditioning and heating systems;
|
o |
A
partnership with Bloom Energy through which we provide components
for
their stand-alone fuel-cell power generation modules; and
|
o |
A
second Advanced Steam Methane Reformer unit was installed in the
U.S.,
built in collaboration with Chevron Technology Ventures, LLC and
BASF
Catalysts LLC for fuel cell applications.
|
o |
Global
vehicular product-focus. For
many years, we have been internally organized by geographic region.
This
has served us well, but as our customers grow globally, it became
apparent
that supporting our regional organization with one consistent, global
product focus is critical to our future success. While we continue
to
manage the business by geographic region, we are now supporting this
regional structure with globally-focused product groups comprised
of
engineers, marketing, sales and support people to provide consistency
in
our products across the regions. Our regional vehicular segments
of
Original Equipment - Americas, Original Equipment - Asia, and Original
Equipment - Europe are now supported by the global product groups
of
Engine Products, Powertrain Cooling Products, and Passenger Thermal
Management Products. This enhanced structure helps drive redundant
costs
out of our organization, and should drive incremental profitable
growth.
|
o |
Modine
Production System. We
also introduced the Modine Production System this year, which standardizes
the processes and systems for each of our plants across the globe.
We are
in the early stages of the process, but we’ve already seen improvements in
those plants that have implemented the changes. Not only does this
help us
better serve our global customer base, but it will benefit our variable
cost position, by creating more manufacturing capacity with less
capital
investment.
|
Years
ended March 31
|
2007
|
2006
|
2005
|
||||||||||||||||
(dollars
in millions)
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
||||||||||
Net
sales
|
$
|
1,757
|
100.0
|
%
|
$
|
1,629
|
100.0
|
%
|
$
|
1,342
|
100.0
|
%
|
|||||||
Cost
of sales
|
1,476
|
84.0
|
%
|
1,319
|
81.0
|
%
|
1,063
|
79.2
|
%
|
||||||||||
Gross
profit
|
282
|
16.0
|
%
|
310
|
19.0
|
%
|
279
|
20.8
|
%
|
||||||||||
Selling,
general and administrative
expenses
and restructuring charges
|
242
|
13.8
|
%
|
220
|
13.5
|
%
|
184
|
13.7
|
%
|
||||||||||
Income
from operations
|
40
|
2.3
|
%
|
90
|
5.5
|
%
|
95
|
7.1
|
%
|
||||||||||
Interest
expense
|
(10
|
)
|
-0.6
|
%
|
(7
|
)
|
-0.4
|
%
|
(6
|
)
|
-0.4
|
%
|
|||||||
Other
income - net
|
9
|
0.5
|
%
|
8
|
0.5
|
%
|
9
|
0.7
|
%
|
||||||||||
Earnings
from continuing operations
before
income taxes
|
39
|
2.2
|
%
|
91
|
5.6
|
%
|
98
|
7.3
|
%
|
||||||||||
(Benefit
from) provision for income
taxes
|
(3
|
)
|
-0.2
|
%
|
30
|
1.8
|
%
|
36
|
2.7
|
%
|
|||||||||
Earnings
from continuing operations
|
$
|
42
|
2.4
|
%
|
$
|
61
|
3.7
|
%
|
$
|
62
|
4.6
|
%
|
Original
Equipment –
Americas
|
|||||||||||||||||||
Years
ended March 31
|
|
2007
|
2006
|
2005
|
|||||||||||||||
(dollars
in millions)
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
||||||||||
Net
sales
|
$
|
743
|
100.0
|
%
|
$
|
682
|
100.0
|
%
|
$
|
590
|
100.0
|
%
|
|||||||
Cost
of sales
|
639
|
86.0
|
%
|
559
|
82.0
|
%
|
471
|
79.8
|
%
|
||||||||||
Gross
profit
|
104
|
14.0
|
%
|
123
|
18.0
|
%
|
119
|
20.2
|
%
|
||||||||||
Selling,
general and administrative
expenses
and restructuring charges
|
50
|
6.7
|
%
|
41
|
6.0
|
%
|
35
|
5.9
|
%
|
||||||||||
Income
from operations
|
$
|
54
|
7.3
|
%
|
$
|
82
|
12.0
|
%
|
$
|
84
|
14.3
|
%
|
Original
Equipment –
Asia
|
|||||||||||||||||||
Years
ended March 31
|
2007
|
2006
|
2005
|
||||||||||||||||
(dollars
in millions)
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
||||||||||
Net
sales
|
$
|
219
|
100.0
|
%
|
$
|
207
|
100.0
|
%
|
$
|
116
|
100.0
|
%
|
|||||||
Cost
of sales
|
201
|
91.8
|
%
|
188
|
90.8
|
%
|
104
|
89.7
|
%
|
||||||||||
Gross
profit
|
18
|
8.2
|
%
|
19
|
9.2
|
%
|
12
|
10.3
|
%
|
||||||||||
Selling,
general and administrative
expenses
|
19
|
8.7
|
%
|
20
|
9.7
|
%
|
10
|
8.6
|
%
|
||||||||||
(Loss)
income from operations
|
$
|
(1
|
)
|
-0.5
|
%
|
$
|
(1
|
)
|
-0.5
|
%
|
$
|
2
|
1.7
|
%
|
Original
Equipment –
Europe
|
|||||||||||||||||||
Years
ended March 31
|
2007
|
2006
|
2005
|
||||||||||||||||
(dollars
in millions)
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
||||||||||
Net
sales
|
$
|
589
|
100.0
|
%
|
$
|
539
|
100.0
|
%
|
$
|
496
|
100.0
|
%
|
|||||||
Cost
of sales
|
477
|
81.0
|
%
|
417
|
77.4
|
%
|
384
|
77.4
|
%
|
||||||||||
Gross
profit
|
112
|
19.0
|
%
|
122
|
22.6
|
%
|
112
|
22.6
|
%
|
||||||||||
Selling,
general and administrative
expenses
|
50
|
8.5
|
%
|
50
|
9.3
|
%
|
50
|
10.1
|
%
|
||||||||||
Income
from operations
|
$
|
62
|
10.5
|
%
|
$
|
72
|
13.4
|
%
|
$
|
62
|
12.5
|
%
|
Commercial
HVAC&R
|
|||||||||||||||||||
Years
ended March 31
|
2007
|
2006
|
2005
|
||||||||||||||||
(dollars
in millions)
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
||||||||||
Net
sales
|
$
|
179
|
100.0
|
%
|
$
|
171
|
100.0
|
%
|
$
|
103
|
100.0
|
%
|
|||||||
Cost
of sales
|
140
|
78.2
|
%
|
127
|
74.3
|
%
|
74
|
71.8
|
%
|
||||||||||
Gross
profit
|
39
|
21.8
|
%
|
44
|
25.7
|
%
|
29
|
28.2
|
%
|
||||||||||
Selling,
general and administrative
expenses
|
31
|
17.3
|
%
|
29
|
17.0
|
%
|
16
|
15.5
|
%
|
||||||||||
Income
from operations
|
$
|
8
|
4.5
|
%
|
$
|
15
|
8.7
|
%
|
$
|
13
|
12.7
|
%
|
Other
|
|||||||||||||||||||
Years
ended March 31
|
2007
|
2006
|
2005
|
||||||||||||||||
(dollars
in millions)
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
$
|
's
|
%
of sales
|
||||||||||
Net
sales
|
$
|
40
|
100.0
|
%
|
$
|
35
|
100.0
|
%
|
$
|
38
|
100.0
|
%
|
|||||||
Cost
of sales
|
38
|
95.0
|
%
|
37
|
105.7
|
%
|
35
|
92.1
|
%
|
||||||||||
Gross
profit (loss)
|
2
|
5.0
|
%
|
(2
|
)
|
-5.7
|
%
|
3
|
7.9
|
%
|
|||||||||
Selling,
general and administrative
expenses
|
10
|
25.0
|
%
|
13
|
37.1
|
%
|
14
|
36.8
|
%
|
||||||||||
Loss
from operations
|
$
|
(8
|
)
|
-20.0
|
%
|
$
|
(15
|
)
|
-42.8
|
%
|
$
|
(11
|
)
|
-28.9
|
%
|
(in
thousands)
|
March
31, 2007
|
|||||||||||||||
|
Total |
Less
than 1 year
|
1
- 3 years
|
4
- 5 years
|
More
than 5 years
|
|||||||||||
Long-term
debt (including interest)
|
$
|
263,092
|
$
|
12,656
|
$
|
41,724
|
$
|
16,462
|
$
|
192,250
|
||||||
Operating
lease obligations
|
19,397
|
4,510
|
5,614
|
3,754
|
5,519
|
|||||||||||
Capital
expenditure commitments
|
30,594
|
29,797
|
797
|
-
|
-
|
|||||||||||
Other
long-term obligations
|
5,002
|
55
|
129
|
110
|
4,708
|
|||||||||||
Total
contractual obligations
|
$
|
318,085
|
$
|
47,018
|
$
|
48,264
|
$
|
20,326
|
$
|
202,477
|
Years
ending March 31
|
||||||||||||||||||||||
Expected Maturity Date
|
||||||||||||||||||||||
(dollars
in thousands)
|
F2008
|
F2009
|
F2010
|
F2011
|
F2012
|
Thereafter
|
Total
|
|||||||||||||||
Fixed
rate (won)
|
$
|
149
|
$
|
203
|
$
|
194
|
$
|
216
|
$
|
239
|
$
|
1,920
|
$
|
2,921
|
||||||||
Average
interest rate
|
3.00
|
%
|
3.00
|
%
|
3.00
|
%
|
3.00
|
%
|
3.00
|
%
|
3.00
|
%
|
Years
ending March 31
|
||||||||||||||||||||||
Expected Maturity Date
|
||||||||||||||||||||||
(dollars
in thousands)
|
F2008
|
F2009
|
F2010
|
F2011
|
F2012
|
Thereafter
|
Total
|
|||||||||||||||
Fixed
rate (won)
|
$
|
149
|
$
|
203
|
$
|
194
|
$
|
216
|
$
|
239
|
$
|
1,920
|
$
|
2,921
|
||||||||
Average
interest rate
|
3.00
|
%
|
3.00
|
%
|
3.00
|
%
|
3.00
|
%
|
3.00
|
%
|
3.00
|
%
|
-
|
|||||||||
Fixed
rate (U.S. dollars)
|
-
|
-
|
-
|
-
|
-
|
$
|
150,000
|
$
|
150,000
|
|||||||||||||
Average
interest rate
|
-
|
-
|
-
|
-
|
-
|
5.30
|
%
|
-
|
||||||||||||||
Variable
rate (U.S. dollars)
|
$
|
3,000
|
-
|
$
|
23,000
|
-
|
-
|
-
|
$
|
26,000
|
||||||||||||
Average
interest rate
|
3.68
|
%
|
-
|
5.56
|
%
|
-
|
-
|
-
|
-
|
|
||||||||||
ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA.
MODINE
MANUFACTURING COMPANY
|
|
|
|
|
|
|
|
|||
CONSOLIDATED
STATEMENTS OF EARNINGS
|
|
|
|
|
|
|
|
|||
For
the years ended March 31, 2007, 2006 and 2005
|
|
|
|
|
|
|
|
|||
(In
thousands, except per share amounts)
|
||||||||||
2007
|
2006
|
2005
|
||||||||
Net
sales
|
$
|
1,757,472
|
$
|
1,628,900
|
$
|
1,342,416
|
||||
Cost
of sales
|
1,475,620
|
1,319,294
|
1,062,576
|
|||||||
Gross
profit
|
281,852
|
309,606
|
279,840
|
|||||||
Selling,
general, and administrative expenses
|
237,837
|
220,090
|
183,391
|
|||||||
Restructuring
charges
|
4,292
|
-
|
1,031
|
|||||||
Income
from operations
|
39,723
|
89,516
|
95,418
|
|||||||
Interest
expense
|
(10,163
|
)
|
(7,247
|
)
|
(6,329
|
)
|
||||
Other
income – net
|
9,727
|
8,271
|
8,828
|
|||||||
Earnings
from continuing operations before income taxes
|
39,287
|
90,540
|
97,917
|
|||||||
(Benefit
from) provision for income taxes
|
(2,975
|
)
|
29,788
|
36,231
|
||||||
Earnings
from continuing operations
|
42,262
|
60,752
|
61,686
|
|||||||
Earnings
(loss) from discontinued operations (net of income taxes)
|
-
|
351
|
(24
|
)
|
||||||
Loss
on spin off of discontinued operations
|
-
|
(53,462
|
)
|
-
|
||||||
Cumulative
effect of accounting change (net of income taxes)
|
70
|
-
|
-
|
|||||||
Net
earnings
|
$
|
42,332
|
$
|
7,641
|
$
|
61,662
|
||||
Earnings
per share of common stock – basic:
|
||||||||||
Continuing
operations
|
$
|
1.32
|
$
|
1.80
|
$
|
1.81
|
||||
Earnings
from discontinued operations
|
-
|
0.01
|
-
|
|||||||
Loss
on spin off of discontinued operations
|
-
|
(1.58
|
)
|
-
|
||||||
Cumulative
effect of accounting change
|
-
|
-
|
-
|
|||||||
Net
earnings – basic
|
$
|
1.32
|
$
|
0.23
|
$
|
1.81
|
||||
Earnings
per share of common stock – diluted:
|
||||||||||
Continuing
operations
|
$
|
1.31
|
$
|
1.78
|
$
|
1.79
|
||||
Earnings
from discontinued operations
|
-
|
0.01
|
-
|
|||||||
Loss
on spin off of discontinued operations
|
-
|
(1.57
|
)
|
-
|
||||||
Cumulative
effect of accounting change
|
-
|
-
|
-
|
|||||||
Net
earnings – diluted
|
$
|
1.31
|
$
|
0.22
|
$
|
1.79
|
||||
The
notes to consolidated financial statements are an integral part
of these
statements.
|
MODINE
MANUFACTURING COMPANY
|
|
|
|
|
|
||
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
||
March
31, 2007 and 2006
|
|
|
|
|
|
||
(In
thousands, except per share amounts)
|
|||||||
2007
|
2006
|
||||||
ASSETS
|
|||||||
Current
assets:
|
|||||||
Cash
and cash equivalents
|
$
|
21,227
|
$
|
30,798
|
|||
Short
term investments
|
3,001
|
-
|
|||||
Trade
receivables, less allowance for doubtful accounts of $1,679 and
$1,511
|
252,359
|
254,681
|
|||||
Inventories
|
111,912
|
90,227
|
|||||
Deferred
income taxes and other current assets
|
68,358
|
36,489
|
|||||
Total
current assets
|
456,857
|
412,195
|
|||||
Noncurrent
assets:
|
|||||||
Property,
plant and equipment – net
|
517,349
|
467,600
|
|||||
Investment
in affiliates
|
18,794
|
41,728
|
|||||
Goodwill
|
67,029
|
52,256
|
|||||
Intangible
assets – net
|
11,137
|
12,735
|
|||||
Prepaid
pension costs
|
-
|
59,894
|
|||||
Other
noncurrent assets
|
27,092
|
5,687
|
|||||
Assets
held for sale
|
3,315
|
-
|
|||||
Total
noncurrent assets
|
644,716
|
639,900
|
|||||
Total
assets
|
$
|
1,101,573
|
$
|
1,052,095
|
|||
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|||||||
Current
liabilities:
|
|||||||
Short-term
debt
|
$
|
344
|
$
|
5,983
|
|||
Long-term
debt – current portion
|
3,149
|
125
|
|||||
Accounts
payable
|
196,330
|
187,048
|
|||||
Accrued
compensation and employee benefits
|
59,801
|
56,835
|
|||||
Income
taxes
|
14,600
|
13,169
|
|||||
Accrued
expenses and other current liabilities
|
33,729
|
31,789
|
|||||
Total
current liabilities
|
307,953
|
294,949
|
|||||
Noncurrent
liabilities:
|
|||||||
Long-term
debt
|
175,856
|
151,706
|
|||||
Deferred
income taxes
|
18,385
|
38,424
|
|||||
Pensions
|
48,847
|
28,933
|
|||||
Postretirement
benefits
|
27,960
|
20,085
|
|||||
Other
noncurrent liabilities
|
29,305
|
12,573
|
|||||
Total
noncurrent liabilities
|
300,353
|
251,721
|
|||||
Total
liabilities
|
608,306
|
546,670
|
|||||
Commitments
and contingencies (See Note 25)
|
|||||||
Shareholders'
equity:
|
|||||||
Preferred
stock, $0.025 par value, authorized 16,000 shares, issued - none
|
-
|
-
|
|||||
Common
stock, $0.625 par value, authorized
|
|||||||
80,000
shares, issued 32,872 and 33,210 shares
|
20,545
|
20,756
|
|||||
Additional
paid-in capital
|
61,240
|
52,459
|
|||||
Retained
earnings
|
439,318
|
433,405
|
|||||
Accumulated
other comprehensive (loss) income
|
(14,779
|
)
|
10,017
|
||||
Treasury
stock at cost: 453 and 404 shares
|
(12,468
|
)
|
(11,212
|
)
|
|||
Deferred
compensation trust
|
(589
|
)
|
-
|
||||
Total
shareholders' equity
|
493,267
|
505,425
|
|||||
Total
liabilities and shareholders' equity
|
$
|
1,101,573
|
$
|
1,052,095
|
|||
The
notes to consolidated financial statements are an integral part
of these
statements.
|
|||||||
MODINE
MANUFACTURING COMPANY
|
|
|
|
|
|
|
|
|||
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|||
For
the years ended March 31, 2007, 2006 and 2005
|
|
|
|
|
|
|
|
|||
(In
thousands)
|
||||||||||
2007
|
2006
|
2005
|
||||||||
Cash
flows from operating activities:
|
||||||||||
Net
earnings
|
$
|
42,332
|
$
|
7,641
|
$
|
61,662
|
||||
Adjustments
to reconcile net earnings with net cash provided by operating
activities:
|
||||||||||
Depreciation
and amortization
|
71,104
|
68,181
|
66,176
|
|||||||
Loss
on spin off of Aftermarket business
|
-
|
53,462
|
-
|
|||||||
Pensions
and postretirement expense
|
6,233
|
8,755
|
6,096
|
|||||||
Loss
from impairment or disposition of property, plant and
equipment
|
2,033
|
4,109
|
1,072
|
|||||||
Deferred
income taxes
|
(9,028
|
)
|
(6,695
|
)
|
8,582
|
|||||
Provision
for doubtful accounts
|
250
|
(60
|
)
|
1,332
|
||||||
Undistributed
earnings of affiliates, net of dividends received
|
(2,707
|
)
|
(1,455
|
)
|
(4,139
|
)
|
||||
Stock-based
compensation expense
|
6,644
|
3,910
|
1,856
|
|||||||
Other
– net
|
(4,006
|
)
|
(2,186
|
)
|
(4,153
|
)
|
||||
Changes
in operating assets and liabilities, excluding acquisitions and
dispositions:
|
||||||||||
Trade
receivables
|
27,888
|
(29,891
|
)
|
(6,708
|
)
|
|||||
Inventories
|
(3,082
|
)
|
1,423
|
9,168
|
||||||
Other
current assets
|
(7,421
|
)
|
8,247
|
5,891
|
||||||
Accounts
payable
|
(5,979
|
)
|
30,313
|
(1,395
|
)
|
|||||
Accrued
compensation and employee benefits
|
980
|
(2,622
|
)
|
2,909
|
||||||
Income
taxes
|
(19,190
|
)
|
(1,440
|
)
|
5,787
|
|||||
Accrued
expenses and other current liabilities
|
(1,834
|
)
|
(8,761
|
)
|
371
|
|||||
Other
noncurrent assets and liabilities
|
(1,807
|
)
|
(3,574
|
)
|
(284
|
)
|
||||
Net
cash provided by operating activities
|
102,410
|
129,357
|
154,223
|
|||||||
Cash
flows from investing activities:
|
||||||||||
Expenditures
for property, plant and equipment
|
(82,752
|
)
|
(79,870
|
)
|
(68,567
|
)
|
||||
Acquisitions,
net of cash acquired
|
(11,096
|
)
|
(37,991
|
)
|
(100,026
|
)
|
||||
Spin
off of Aftermarket business
|
-
|
(6,300
|
)
|
-
|
||||||
Proceeds
from purchase price settlement
|
2,900
|
2,500
|
-
|
|||||||
Proceeds
from dispositions of assets
|
931
|
863
|
2,022
|
|||||||
Investments
in affiliates
|
-
|
-
|
(2,246
|
)
|
||||||
Other
– net
|
181
|
1,082
|
9
|
|||||||
Net
cash used for investing activities
|
(89,836
|
)
|
(119,716
|
)
|
(168,808
|
)
|
||||
Cash
flows from financing activities:
|
||||||||||
Short-term
debt, net
|
(6,118
|
)
|
5,992
|
-
|
||||||
Additions
to long-term debt
|
209,629
|
318,233
|
115,000
|
|||||||
Reductions
of long-term debt
|
(187,386
|
)
|
(267,767
|
)
|
(104,754
|
)
|
||||
Bank
overdrafts
|
(2,069
|
)
|
7,993
|
(1,289
|
)
|
|||||
Proceeds
from exercise of stock options
|
2,914
|
12,500
|
9,971
|
|||||||
Repurchase
of common stock, treasury and retirement
|
(14,519
|
)
|
(82,811
|
)
|
(1,591
|
)
|
||||
Cash
dividends paid
|
(22,642
|
)
|
(23,878
|
)
|
(21,610
|
)
|
||||
Settlement
of derivative contracts
|
(1,412
|
)
|
(2,238
|
)
|
-
|
|||||
Excess
tax benefits from stock-based compensation
|
382
|
-
|
-
|
|||||||
Other
– net
|
5
|
(281
|
)
|
4
|
||||||
Net
cash used for financing activities
|
(21,216
|
)
|
(32,257
|
)
|
(4,269
|
)
|
||||
Effect
of exchange rate changes on cash
|
(929
|
)
|
(1,677
|
)
|
4,187
|
|||||
Net
decrease in cash and cash equivalents
|
(9,571
|
)
|
(24,293
|
)
|
(14,667
|
)
|
||||
Cash
and cash equivalents at beginning of year
|
30,798
|
55,091
|
69,758
|
|||||||
Cash
and cash equivalents at end of year
|
$
|
21,227
|
$
|
30,798
|
$
|
55,091
|
||||
Cash
paid during the year for:
|
||||||||||
Interest,
net of amounts capitalized
|
$
|
8,648
|
$
|
7,094
|
$
|
6,428
|
||||
Income
taxes
|
$
|
22,845
|
$
|
38,206
|
$
|
18,742
|
||||
Non-cash
activity:
|
||||||||||
Shareholder
dividend related to spin-off of Aftermarket business
|
$
|
-
|
$
|
(51,319
|
)
|
$
|
-
|
|||
The
notes to consolidated financial statements are an integral part
of these
statements.
|
MODINE
MANUFACTURING COMPANY
|
|||||||||||||||||||||||||
CONSOLIDATED
STATEMENTS OF SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME
(LOSS)
|
|||||||||||||||||||||||||
For
the years ended March 31, 2007, 2006 and 2005
|
|||||||||||||||||||||||||
(In
thousands, except per share amounts)
|
|||||||||||||||||||||||||
Preferred
stock
|
|
|
|
Common
stock
|
|
|
Additional
paid-in capital
|
|
|
Retained
earnings
|
|
|
Accumulated
other comprehensive income (loss
|
)
|
|
Treasury
stock
|
|
|
Deferred
compensation trust
|
|
|
Total
|
|||
Balance,
March 31, 2004
|
$
|
-
|
$
|
21,478
|
$
|
26,696
|
$
|
535,885
|
$
|
9,974
|
$
|
(7,492
|
)
|
$
|
-
|
$
|
586,541
|
||||||||
Comprehensive
income:
|
|||||||||||||||||||||||||
Net
earnings
|
-
|
-
|
-
|
61,662
|
-
|
-
|
-
|
61,662
|
|||||||||||||||||
Foreign-currency
translation
|
-
|
-
|
-
|
-
|
23,342
|
-
|
-
|
23,342
|
|||||||||||||||||
Minimum
pension liability (net of taxes of
$828)
|
-
|
-
|
-
|
-
|
(1,325
|
)
|
-
|
-
|
(1,325
|
)
|
|||||||||||||||
Total
comprehensive income
|
83,679
|
||||||||||||||||||||||||
Cash
dividends, $0.63 per share
|
-
|
-
|
-
|
(21,610
|
)
|
-
|
-
|
-
|
(21,610
|
)
|
|||||||||||||||
Purchase
of treasury stock
|
-
|
-
|
-
|
-
|
-
|
(1,591
|
)
|
-
|
(1,591
|
)
|
|||||||||||||||
Stock
options and awards including related tax
benefits
|
-
|
316
|
10,585
|
-
|
-
|
-
|
-
|
10,901
|
|||||||||||||||||
Amortization
of deferred compensation under
restricted
stock plans
|
-
|
-
|
1,860
|
-
|
-
|
-
|
-
|
1,860
|
|||||||||||||||||
Balance,
March 31, 2005
|
-
|
21,794
|
39,141
|
575,937
|
31,991
|
(9,083
|
)
|
-
|
659,780
|
||||||||||||||||
Comprehensive
income (loss):
|
|||||||||||||||||||||||||
Net
earnings
|
-
|
-
|
-
|
7,641
|
-
|
-
|
-
|
7,641
|
|||||||||||||||||
Foreign-currency
translation
|
-
|
-
|
-
|
-
|
(19,109
|
)
|
-
|
-
|
(19,109
|
)
|
|||||||||||||||
Cash
flow hedge (net of taxes of $663)
|
-
|
-
|
-
|
-
|
(1,042
|
)
|
-
|
-
|
(1,042
|
)
|
|||||||||||||||
Minimum
pension liability (net of taxes of
$1,119)
|
-
|
-
|
-
|
-
|
(1,823
|
)
|
-
|
-
|
(1,823
|
)
|
|||||||||||||||
Total
comprehensive income loss
|
(14,333
|
)
|
|||||||||||||||||||||||
Cash
dividends, $0.70 per share
|
-
|
-
|
-
|
(23,878
|
)
|
-
|
-
|
-
|
(23,878
|
)
|
|||||||||||||||
Shareholder
dividend related to spin off
|
-
|
-
|
-
|
(51,319
|
)
|
-
|
-
|
-
|
(51,319
|
)
|
|||||||||||||||
Stock
repurchase program
|
-
|
(1,525
|
)
|
(4,182
|
)
|
(74,976
|
)
|
-
|
-
|
-
|
(80,683
|
)
|
|||||||||||||
Purchase
of treasury stock
|
-
|
-
|
-
|
-
|
-
|
(2,129
|
)
|
-
|
(2,129
|
)
|
|||||||||||||||
Stock
options and awards including related tax
benefits
|
-
|
487
|
13,995
|
-
|
-
|
-
|
-
|
14,482
|
|||||||||||||||||
Amortization
of deferred compensation under
restricted
stock plans
|
-
|
-
|
3,505
|
-
|
-
|
-
|
-
|
3,505
|
|||||||||||||||||
Balance,
March 31, 2006
|
-
|
20,756
|
52,459
|
433,405
|
10,017
|
(11,212
|
)
|
-
|
505,425
|
||||||||||||||||
Comprehensive
income:
|
|||||||||||||||||||||||||
Net
earnings
|
-
|
-
|
-
|
42,332
|
-
|
-
|
-
|
42,332
|
|||||||||||||||||
Foreign-currency
translation
|
-
|
-
|
-
|
-
|
24,895
|
-
|
-
|
24,895
|
|||||||||||||||||
Cash
flow hedges (net of taxes of $272)
|
(525
|
)
|
-
|
(525
|
)
|
||||||||||||||||||||
Minimum
pension liability (net of taxes of
$1,383)
|
-
|
-
|
-
|
-
|
2,275
|
-
|
-
|
2,275
|
|||||||||||||||||
Total
comprehensive income
|
68,977
|
||||||||||||||||||||||||
Adjustment
for SAB No. 108
|
-
|
-
|
-
|
(1,775
|
)
|
-
|
-
|
-
|
(1,775
|
)
|
|||||||||||||||
Adjustment
to adopt SFAS No. 158
|
-
|
-
|
(51,441
|
)
|
-
|
-
|
(51,441
|
)
|
|||||||||||||||||
Cash
dividends, $0.70 per share
|
-
|
-
|
-
|
(22,642
|
)
|
-
|
-
|
-
|
(22,642
|
)
|
|||||||||||||||
Stock
repurchase program
|
-
|
(314
|
)
|
(947
|
)
|
(12,002
|
)
|
-
|
-
|
-
|
(13,263
|
)
|
|||||||||||||
Purchase
of treasury stock
|
-
|
-
|
-
|
-
|
-
|
(1,256
|
)
|
-
|
(1,256
|
)
|
|||||||||||||||
Stock
options and awards including related tax
benefits
|
-
|
103
|
6,173
|
-
|
-
|
-
|
-
|
6,276
|
|||||||||||||||||
Amortization
of deferred compensation under
restricted
stock plans
|
-
|
-
|
3,555
|
-
|
-
|
-
|
-
|
3,555
|
|||||||||||||||||
Investment
in deferred compensation trust
|
-
|
-
|
-
|
-
|
-
|
(589
|
)
|
(589
|
)
|
||||||||||||||||
Balance,
March 31, 2007
|
$
|
-
|
$
|
20,545
|
$
|
61,240
|
$
|
439,318
|
$
|
(14,779
|
)
|
$
|
(12,468
|
)
|
$
|
(589
|
)
|
$
|
493,267
|
||||||
The
notes to consolidated financial statements are an integral part
of these
statements.
|
Period
in which the
|
|
|
|
||||||||||
|
|
Misstatement
Originated (1)
|
|||||||||||
Cumulative
|
Adjustment
|
||||||||||||
Prior
to
|
Year
Ended March 31,
|
Recorded
as of
|
|||||||||||
April
1, 2004
|
2005
|
2006
|
April
1, 2006
|
||||||||||
Fixed
assets (2)
|
$
|
482
|
$
|
324
|
$
|
732
|
$
|
1,538
|
|||||
Vacation
(3)
|
-
|
-
|
510
|
510
|
|||||||||
Inventory
(4)
|
-
|
-
|
456
|
456
|
|||||||||
Administrative
expenses (5)
|
-
|
-
|
124
|
124
|
|||||||||
Deferred
income taxes (6)
|
(166
|
)
|
(112
|
)
|
(575
|
)
|
(853
|
)
|
|||||
Impact
on net income (7)
|
$
|
316
|
$
|
212
|
$
|
1,247
|
|||||||
Retained
earnings (8)
|
$
|
1,775
|
(1) |
The
Company has concluded that these errors were immaterial, individually
and
in the aggregate, to all periods prior to April 1, 2006.
|
(2) |
The
Company was not properly accounting for the disposal of fixed assets
within the Original Equipment - Europe segment. As a result of this
error,
net income was overstated by $482 (cumulatively) in fiscal years
prior to
2005, by $324 in fiscal 2005 and by $732 in fiscal 2006. The Company
recorded a $1,538 reduction of fixed assets for disposals not previously
recognized as of April 1, 2006 with a corresponding reduction in
retained
earnings to correct these misstatements.
|
(3) |
The
Company was not properly recording its vacation accrual within the
Original Equipment - Asia segment. As a result of this error, pretax
income was overstated by $510 in fiscal 2006. The Company recorded
a $510
increase in the vacation liability as of April 1, 2006 with a
corresponding reduction in retained earnings to correct this misstatement.
This includes $125 which was previously recorded in the first quarter
of
fiscal 2007.
|
(4) |
The
Company did not properly recognize a $456 reduction in inventory
at one
operating location within the Original Equipment - Americas segment
which
was identified as a result of a physical inventory performed on September
26, 2006. As a result of this error, pretax income was overstated
by $456
in fiscal 2006. The Company recorded a $456 reduction in the inventory
balance as of April 1, 2006 with a corresponding reduction in retained
earnings to correct this misstatement.
|
(5) |
As
a result of a clerical error, the Company improperly capitalized
certain
corporate administrative charges, consisting primarily of salaries
and
miscellaneous office expenses, within accounts receivable at March
31,
2006. As a result of this error, pretax income was overstated by
$124 in
fiscal 2006. The Company recorded a $124 reduction in the accounts
receivable balance as of April 1, 2006 with a corresponding reduction
in
retained earnings to correct this
misstatement.
|
(6) |
As
a result of the misstatements previously described, the provision
for
income taxes was overstated by $166 (cumulatively) in fiscal years
prior
to 2005, by $112 in fiscal 2005 and by $575 in fiscal 2006. The Company
recorded an increase in the deferred income tax assets in the amount
of
$853 as of April 1, 2006 with a corresponding increase in retained
earnings to correct these misstatements.
|
(7) |
Represents
the net overstatement of net income for the indicated periods resulting
from these misstatements.
|
(8) |
Represents
the net reduction to retained earnings recorded as of April 1, 2006
to
reflect the initial application of SAB No.
108.
|
Prior
to SFAS No. 158 adoption
|
SFAS
No. 158 adoption adjustments
|
After
SFAS No. 158 adoption
|
||||||||
Deferred
income taxes and other current assets
|
$
|
33,401
|
$
|
34,957
|
$
|
68,358
|
||||
Intangible
assets - net
|
14,205
|
(3,068
|
)
|
11,137
|
||||||
Prepaid
pension costs
|
57,310
|
(57,310
|
)
|
-
|
||||||
Total
assets
|
1,126,994
|
(25,421
|
)
|
1,101,573
|
||||||
Pensions
|
30,447
|
18,400
|
48,847
|
|||||||
Postretirement
benefits
|
(20,340
|
)
|
7,620
|
27,960
|
||||||
Total
liabilities
|
582,286
|
26,020
|
608,306
|
|||||||
Accumulated
other comprehensive income (loss)
|
36,662
|
(51,441
|
)
|
(14,779
|
)
|
|||||
Total
shareholders' equity
|
544,708
|
(51,441
|
)
|
493,267
|
||||||
Total
liabilities and shareholders' equity
|
1,126,994
|
(25,421
|
)
|
1,101,573
|
Pensions
Plans
|
Postretirement
Plans
|
||||||||||||
Years
ended March 31
|
2007
|
2006
|
2007
|
2006
|
|||||||||
Change
in benefit obligation:
|
|||||||||||||
Benefit
obligation at beginning of year
|
$
|
269,851
|
$
|
248,994
|
$
|
33,310
|
$
|
42,038
|
|||||
Service
cost
|
4,371
|
8,571
|
361
|
383
|
|||||||||
Interest
cost
|
15,003
|
13,980
|
1,748
|
1,883
|
|||||||||
Plan
amendments
|
1,636
|
2,192
|
-
|
-
|
|||||||||
Actuarial
(gain) loss
|
(15,465
|
)
|
14,778
|
(1,554
|
)
|
(6,325
|
)
|
||||||
Benefits
paid
|
(13,966
|
)
|
(12,522
|
)
|
(5,123
|
)
|
(5,722
|
)
|
|||||
Special
termination benefits
|
738
|
-
|
-
|
-
|
|||||||||
Curtailment
loss
|
(127
|
)
|
-
|
-
|
-
|
||||||||
Contributions
by plan participants
|
-
|
-
|
1,488
|
1,053
|
|||||||||
Medicare
subsidy
|
-
|
-
|
474
|
-
|
|||||||||
Currency
translation adjustment
|
2,214
|
(2,050
|
)
|
-
|
-
|
||||||||
Aftermarket
spin off
|
-
|
(4,092
|
)
|
-
|
-
|
||||||||
Benefit
obligation at end of year
|
$
|
264,255
|
$
|
269,851
|
$
|
30,704
|
$
|
33,310
|
|||||
Change
in plan assets:
|
|||||||||||||
Fair
value of plan assets at beginning of year
|
$
|
210,632
|
$
|
213,716
|
$
|
-
|
$
|
-
|
|||||
Actual
return on plan assets
|
15,663
|
7,773
|
-
|
-
|
|||||||||
Benefits
paid
|
(13,966
|
)
|
(12,522
|
)
|
(5,123
|
)
|
(5,722
|
)
|
|||||
Employer
contributions
|
3,035
|
3,683
|
3,161
|
4,669
|
|||||||||
Contributions
by plan participants
|
-
|
-
|
1,488
|
1,053
|
|||||||||
Medicare
subsidy
|
-
|
-
|
474
|
-
|
|||||||||
Aftermarket
spin off
|
-
|
(2,018
|
)
|
-
|
-
|
||||||||
Fair
value of plan assets at end of year
|
$
|
215,364
|
$
|
210,632
|
$
|
-
|
$
|
-
|
|||||
Funded
status at end of year
|
$
|
(48,891
|
)
|
$
|
(59,219
|
)
|
$
|
(30,704
|
)
|
$
|
(33,310
|
)
|
|
Unrecognized
actuarial loss
|
-
|
108,124
|
-
|
9,226
|
|||||||||
Unrecognized
prior service costs
|
-
|
(593
|
)
|
-
|
293
|
||||||||
Unrecognzied
net transition obligation
|
-
|
(54
|
)
|
-
|
-
|
||||||||
Net
amount recognized
|
$
|
(48,891
|
)
|
$
|
48,258
|
$
|
(30,704
|
)
|
$
|
(23,791
|
)
|
||
Amounts
recongized in the consolidated balance sheet consist of:
|
|||||||||||||
Prepaid
benefit costs
|
$
|
59,894
|
$
|
-
|
|||||||||
Accrued
benefit liability
|
(30,056
|
)
|
(23,791
|
)
|
|||||||||
Intangible
asset
|
2,832
|
-
|
|||||||||||
Accumulated
other comprehensive income
|
15,588
|
-
|
|||||||||||
Net
amount recognized
|
$
|
48,258
|
$
|
(23,791
|
)
|
||||||||
Current
liability
|
$
|
(44
|
)
|
$
|
(2,744
|
)
|
|||||||
Noncurrent
liability
|
(48,847
|
)
|
(27,960
|
)
|
|||||||||
$
|
(48,891
|
)
|
$
|
(30,704
|
)
|
||||||||
Amounts
recongized in accumulated other comprehensive income
(loss)
consist of:
|
|||||||||||||
Net
actuarial loss
|
$
|
90,585
|
$
|
7,349
|
|||||||||
Prior
service cost
|
241
|
271
|
|||||||||||
Net
transition asset
|
(27
|
)
|
-
|
||||||||||
$
|
90,799
|
$
|
7,620
|
Years
ended March 31
|
2007
|
2006
|
|||||
Projected
benefit obligation
|
$
|
66,911
|
$
|
57,767
|
|||
Accumulated
benefit obligations
|
61,701
|
56,393
|
|||||
Fair
value of the plan assets
|
31,634
|
28,907
|
Pension
Plans
|
Postretirement
Plans
|
||||||||||||||||||
Years
ended March 31
|
2007
|
2006
|
2005
|
2007
|
2006
|
2005
|
|||||||||||||
Components
of net periodic benefit costs:
|
|||||||||||||||||||
Service
cost
|
$
|
4,371
|
$
|
8,335
|
$
|
7,458
|
$
|
361
|
$
|
383
|
$
|
397
|
|||||||
Interest
cost
|
15,003
|
13,528
|
13,762
|
1,748
|
1,842
|
2,116
|
|||||||||||||
Expected
return on plan assets
|
(18,959
|
)
|
(18,396
|
)
|
(19,367
|
)
|
-
|
-
|
-
|
||||||||||
Amortization
of:
|
|||||||||||||||||||
Unrecognized
net loss
|
5,578
|
4,637
|
2,432
|
323
|
415
|
476
|
|||||||||||||
Unrecognized
prior service cost
|
14
|
65
|
497
|
22
|
21
|
(7
|
)
|
||||||||||||
Unrecognized
net asset
|
(27
|
)
|
(27
|
)
|
(27
|
)
|
-
|
-
|
-
|
||||||||||
Adjustment
for curtailment
|
663
|
-
|
1,081
|
-
|
-
|
-
|
|||||||||||||
Adjustment
for special termination benefits
|
738
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||
Net
periodic benefit cost
|
$
|
7,381
|
$
|
8,142
|
$
|
5,836
|
$
|
2,454
|
$
|
2,661
|
$
|
2,982
|
Years
ended March 31
|
2007
|
2006
|
|||||||||||
U.S.
Plans
|
Foreign
Plans
|
U.S.
Plans
|
Foreign
Plans
|
||||||||||
Pension
plans:
|
|||||||||||||
Discount
rate
|
5.92
|
%
|
4.70
|
%
|
5.75
|
%
|
4.25
|
%
|
|||||
Rate
of compensation increase
|
4.00
|
%
|
1.75
|
%
|
4.00
|
%
|
2.00
|
%
|
|||||
Postretirement
plans:
|
|||||||||||||
Discount
rate
|
5.92
|
%
|
5.75
|
%
|
|||||||||
Rate
of compensation increase
|
4.00
|
%
|
4.00
|
%
|
Years
ended March 31
|
2007
|
2006
|
2005
|
||||||||||||||||
U.S.
Plans
|
Foreign
Plans
|
U.S.
Plans
|
Foreign
Plans
|
U.S.
Plans
|
Foreign
Plans
|
||||||||||||||
Pension
plans:
|
|||||||||||||||||||
Discount
rate
|
5.75
|
%
|
4.25
|
%
|
5.75
|
%
|
4.25
|
%
|
6.25
|
%
|
5.89
|
%
|
|||||||
Expected
return on plan assets
|
8.50
|
%
|
N/A
|
8.50
|
%
|
N/A
|
8.75
|
%
|
N/A
|
||||||||||
Rate
of compensation increase
|
4.00
|
%
|
1.50
|
%
|
4.00
|
%
|
2.00
|
%
|
4.00
|
%
|
3.52
|
%
|
|||||||
Postretirement
plans:
|
|||||||||||||||||||
Discount
rate
|
5.75
|
%
|
5.75
|
%
|
6.25
|
%
|
|||||||||||||
Rate
of compensation increase
|
4.00
|
%
|
4.00
|
%
|
4.00
|
%
|
Target
allocation
|
Plan
assets
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Equity
securiites
|
60
|
%
|
55
|
%
|
65
|
%
|
56
|
%
|
|||||
Debt
securities
|
38
|
%
|
40
|
%
|
33
|
%
|
39
|
%
|
|||||
Cash
|
2
|
%
|
5
|
%
|
2
|
%
|
5
|
%
|
|||||
100
|
%
|
100
|
%
|
100
|
%
|
100
|
%
|
Years
ended March 31
|
2007
|
2006
|
|||||
Healthcare
costs trend rate assumed for next year (pre-65)
|
9.0
|
%
|
10.0
|
%
|
|||
Healthcare
costs trend rate assumed for next year (post-65)
|
8.5
|
%
|
10.0
|
%
|
|||
Ultimate
trend rate
|
5.0
|
%
|
5.0
|
%
|
|||
Year
the rate reaches the ultimate trend rate
|
2011
|
2011
|
One
percentage point
|
|||||||
Year
ended March 31, 2007
|
Increase
|
Decrease
|
|||||
Effect
on total of service and interest cost
|
$
|
72
|
$
|
(64
|
)
|
||
Effect
on postretirement benefit obligation
|
1,123
|
(996
|
)
|
Years
ended March 31
|
||||
Pension
|
||||
2008
|
$
|
12,129
|
||
2009
|
12,459
|
|||
2010
|
13,538
|
|||
2011
|
14,266
|
|||
2012
|
14,240
|
|||
2013
- 2017
|
78,832
|
Years
ending March 31
|
||||
2008
|
$
|
4,510
|
||
2009
|
3,106
|
|||
2010
|
2,508
|
|||
2011
|
2,039
|
|||
2012
|
1,715
|
|||
2013
and beyond
|
5,519
|
|||
Total
future minimum rental commitments
|
$
|
19,397
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Equity
in earnings of non-consolidated affiliates
|
$
|
3,576
|
$
|
4,222
|
$
|
5,091
|
||||
Interest
income
|
1,308
|
1,698
|
759
|
|||||||
Foreign
currency transactions
|
496
|
157
|
2,585
|
|||||||
Purchase
price settlement
|
2,900
|
1,719
|
781
|
|||||||
Other
non-operating income (loss) - net
|
1,447
|
475
|
(388
|
)
|
||||||
Total
other income - net
|
$
|
9,727
|
$
|
8,271
|
$
|
8,828
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Components
of earnings (loss) from continuing operations before
income
taxes:
|
||||||||||
United
States
|
$
|
(16,693
|
)
|
$
|
33,515
|
$
|
45,535
|
|||
Foreign
|
55,980
|
57,025
|
52,382
|
|||||||
Total
earnings from continuing operations before income taxes
|
$
|
39,287
|
$
|
90,540
|
$
|
97,917
|
||||
Income
tax (benefit) expense:
|
||||||||||
Federal:
|
||||||||||
Current
|
$
|
(12,078
|
)
|
$
|
10,895
|
$
|
11,789
|
|||
Deferred
|
(5,397
|
)
|
(4,929
|
)
|
1,979
|
|||||
State:
|
||||||||||
Current
|
1,071
|
2,080
|
2,846
|
|||||||
Deferred
|
(1,333
|
)
|
(543
|
)
|
168
|
|||||
Foreign:
|
||||||||||
Current
|
16,988
|
23,502
|
15,400
|
|||||||
Deferred
|
(2,226
|
)
|
(1,217
|
)
|
4,049
|
|||||
Total
income tax (benefit) expense
|
$
|
(2,975
|
)
|
$
|
29,788
|
$
|
36,231
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Statutory
federal tax
|
35.0
|
%
|
35.0
|
%
|
35.0
|
%
|
||||
State
taxes, net of federal benefit
|
(1.9
|
)
|
0.7
|
1.9
|
||||||
Taxes
on non-U.S. earnings and losses
|
(6.9
|
)
|
(0.8
|
)
|
(1.1
|
)
|
||||
Foreign
repatriation
|
-
|
2.2
|
-
|
|||||||
Valuation
allowance
|
1.3
|
0.3
|
0.6
|
|||||||
Research
and development tax credit
|
(6.4
|
)
|
(4.8
|
)
|
-
|
|||||
Worthless
stock deduction
|
(20.3
|
)
|
-
|
-
|
||||||
Net
operating losses in Brazil
|
(10.4
|
)
|
-
|
-
|
||||||
Other
|
2.0
|
0.3
|
0.6
|
|||||||
Effective
tax rate
|
(7.6
|
%)
|
32.9
|
%
|
37.0
|
%
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Pensions
|
$
|
(2,180
|
)
|
$
|
(1,555
|
)
|
$
|
(1,399
|
)
|
|
Depreciation
|
(85
|
)
|
(3,794
|
)
|
306
|
|||||
Inventories
|
(335
|
)
|
(276
|
)
|
184
|
|||||
Employee
benefits
|
(516
|
)
|
(1,960
|
)
|
138
|
|||||
Benefit
of tax losses and credit carryforwards
|
(7,551
|
)
|
409
|
2,136
|
||||||
Intangibles
|
774
|
802
|
944
|
|||||||
Foreign
currency gain (loss)
|
1,387
|
(330
|
)
|
2,034
|
||||||
Accrued
liabilities
|
(636
|
)
|
324
|
1,275
|
||||||
Other
|
186
|
(309
|
)
|
578
|
||||||
Total
deferred income tax (benefit) expense
|
$
|
(8,956
|
)
|
$
|
(6,689
|
)
|
$
|
6,196
|
March
31
|
2007
|
2006
|
|||||
Deferred
tax assets:
|
|||||||
Accounts
receivable
|
$
|
888
|
$
|
267
|
|||
Inventories
|
2,120
|
1,901
|
|||||
Plant
and equipment
|
6,708
|
604
|
|||||
Employee
benefits
|
42,141
|
23,568
|
|||||
Net
operating loss, capital loss and credit carryforwards
|
12,443
|
4,417
|
|||||
Other,
principally accrued liabilities
|
10,757
|
15,100
|
|||||
Total
gross deferred tax assets
|
75,057
|
45,857
|
|||||
Less:
valuation allowance
|
3,844
|
3,303
|
|||||
Net
deferred tax assets
|
71,213
|
42,554
|
|||||
Deferred
tax liabilities:
|
|||||||
Goodwill
|
8,671
|
3,772
|
|||||
Pension
|
1,020
|
27,533
|
|||||
Plant
and equipment
|
33,511
|
26,506
|
|||||
Other
|
14,180
|
9,264
|
|||||
Total
gross deferred tax liabilities
|
57,382
|
67,075
|
|||||
Net
deferred tax asset (liability)
|
$
|
13,831
|
$
|
(24,521
|
)
|
Years
ending March 31
|
||||
2008
|
$
|
1,005
|
||
2009
|
2,143
|
|||
2010
|
2,547
|
|||
2011
|
2,281
|
|||
2012
|
2,155
|
|||
No
expiration date
|
13,959
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Numerator:
|
||||||||||
Earnings
from continuing operations
|
$
|
42,262
|
$
|
60,752
|
$
|
61,686
|
||||
Earnings
(loss) from discontinued operations
|
-
|
351
|
(24
|
)
|
||||||
Loss
on spin off of discontinued operations
|
-
|
(53,462
|
)
|
-
|
||||||
Cumulative
effect of accounting change
|
70
|
-
|
-
|
|||||||
Net
earnings
|
$
|
42,332
|
$
|
7,641
|
$
|
61,662
|
||||
Denominator:
|
||||||||||
Weighted
average shares outstanding – basic
|
32,149
|
33,729
|
34,092
|
|||||||
Effect
of dilutive securities
|
97
|
415
|
388
|
|||||||
Weighted
average shares outstanding – diluted
|
32,246
|
34,144
|
34,480
|
|||||||
Net
earnings per share of common stock – basic:
|
||||||||||
Continuing
operations
|
$
|
1.32
|
$
|
1.80
|
$
|
1.81
|
||||
Earnings
from discontinued operations
|
-
|
0.01
|
-
|
|||||||
Loss
on spin off of discontinued operations
|
-
|
(1.58
|
)
|
-
|
||||||
Cumulative
effect of accounting change
|
-
|
-
|
-
|
|||||||
Net
earnings – basic
|
$
|
1.32
|
$
|
0.23
|
$
|
1.81
|
||||
Net
earnings per share of common stock – diluted:
|
||||||||||
Continuing
operations
|
$
|
1.31
|
$
|
1.78
|
$
|
1.79
|
||||
Earnings
from discontinued operations
|
-
|
0.01
|
-
|
|||||||
Loss
on spin off of discontinued operations
|
-
|
(1.57
|
)
|
-
|
||||||
Cumulative
effect of accounting change
|
-
|
-
|
-
|
|||||||
Net
earnings – diluted
|
$
|
1.31
|
$
|
0.22
|
$
|
1.79
|
March
31
|
2007
|
2006
|
|||||
Raw
materials and work in process
|
$
|
83,218
|
$
|
69,214
|
|||
Finished
goods
|
28,694
|
21,013
|
|||||
Total
inventories
|
$
|
111,912
|
$
|
90,227
|
March
31
|
2007
|
2006
|
|||||
Land
|
$
|
27,359
|
$
|
25,023
|
|||
Buildings
and improvements (10-40 years)
|
278,992
|
263,765
|
|||||
Machinery
and equipment (3-12 years)
|
587,063
|
516,589
|
|||||
Office
equipment (3-10 years)
|
101,057
|
80,135
|
|||||
Transportation
equipment (3-9 years)
|
12,158
|
10,710
|
|||||
Construction
in progress
|
47,147
|
44,097
|
|||||
1,053,776
|
940,319
|
||||||
Less
accumulated depreciation
|
(536,427
|
)
|
(472,719
|
)
|
|||
Net
property, plant and equipment
|
$
|
517,349
|
$
|
467,600
|
March
31
|
2007
|
2006
|
||||||||
Percent-owned
|
||||||||||
Radiadores
Visconde Ltda. (Brazil)
|
50%
(1
|
)
|
$
|
-
|
$
|
26,016
|
||||
Nikkei
Heat Exchanger Company, Ltd. (Japan)
|
50
|
%
|
5,442
|
5,414
|
||||||
Constructions
Mechaniques Mota, S.A. (France)
|
41
|
%
|
10,624
|
7,675
|
||||||
Anhue
Jianghaui Madno Climate Control Co. Ltd. (China)
|
50
|
%
|
2,728
|
2,623
|
||||||
Total
net investment in affiliates
|
$
|
18,794
|
$
|
41,728
|
||||||
(1)
Prior to the acquisition of the remaining 50% on May 4,
2006
|
Radiadores
Visconde
|
|
Airedale
|
|
Jackson,
Mississippi
|
|
South
Korea
|
|
Shanghai,
China
|
||||||||
Assets
acquired:
|
||||||||||||||||
Trade
receivables – net
|
$
|
15,123
|
$
|
14,595
|
$
|
5,839
|
$
|
44,927
|
$
|
2,957
|
||||||
Inventories
|
16,026
|
5,242
|
5,766
|
9,830
|
3,269
|
|||||||||||
Other
current and noncurrent assets
|
5,050
|
1,971
|
731
|
5,933
|
162
|
|||||||||||
Property,
plant and equipment – net
|
20,517
|
5,609
|
9,450
|
66,384
|
209
|
|||||||||||
Goodwill
(initial 50 percent already owned)
|
11,821
|
-
|
-
|
-
|
-
|
|||||||||||
Tradename
|
1,153
|
10,243
|
-
|
-
|
-
|
|||||||||||
Non-compete
agreement
|
430
|
-
|
-
|
-
|
-
|
|||||||||||
Total
assets
|
70,120
|
37,660
|
21,786
|
127,074
|
6,597
|
|||||||||||
Liabilities
assumed:
|
||||||||||||||||
Accounts
payable
|
10,420
|
6,815
|
7,105
|
39,234
|
2,331
|
|||||||||||
Accrued
compensation and employee benefits
|
3,268
|
1,115
|
639
|
180
|
2
|
|||||||||||
Accrued
expenses and other current liabilities
|
3,549
|
4,524
|
830
|
2,401
|
388
|
|||||||||||
Other
noncurrent liabilities
|
9,137
|
4,481
|
-
|
3,860
|
-
|
|||||||||||
Total
liabilities
|
26,374
|
16,935
|
8,574
|
45,675
|
2,721
|
|||||||||||
Total
debt assumed
|
-
|
-
|
-
|
2,458
|
-
|
|||||||||||
|
||||||||||||||||
Net
assets acquired
|
43,746
|
20,725
|
13,212
|
78,941
|
3,876
|
|||||||||||
Equity
investment allocated to assets
|
||||||||||||||||
acquired
and liabilities assumed
|
26,650
|
-
|
-
|
-
|
-
|
|||||||||||
Net
purchase price
|
17,096
|
37,991
|
16,637
|
78,941
|
4,398
|
|||||||||||
|
||||||||||||||||
Recognized
goodwill
|
$
|
-
|
$
|
17,266
|
$
|
3,425
|
$
|
-
|
$
|
522
|
July
22, 2005
|
|
Cash
and cash equivalents
|
$
6,300
|
Trade
receivables
|
33,652
|
Inventory
|
59,768
|
Other
current assets
|
7,163
|
Property,
plant and equipment
|
20,201
|
Other
non-current assets
|
1,425
|
Assets
of discontinued operations
|
$
128,509
|
Accounts
payable
|
$
15,051
|
Other
current liabilities
|
9,722
|
Other
non-current liabilities
|
2,316
|
Liabilities
of discontinued operations
|
$
27,089
|
For
the period April 1, 2005 -
July
22, 2005
|
Fiscal
year ending March 31, 2005
|
|
Net
sales
|
$82,579
|
$205,599
|
Cost
of sales and other expenses
|
81,933
|
206,640
|
Earnings
(loss) before income taxes
|
646
|
(1,041)
|
Income
tax expense (benefit)
|
295
|
(1,017)
|
Earnings
(loss) from discontinued operations
|
$
351
|
$
(24)
|
Termination
Benefits:
|
||||
Balance,
April 1, 2006
|
$
|
-
|
||
Additions
|
4,270
|
|||
Adjustments
|
(65
|
)
|
||
Payments
|
(1,892
|
)
|
||
Balance,
March 31, 2007
|
$
|
2,313
|
||
Other
Restructuring Charges:
|
||||
Balance,
April 1, 2006
|
$
|
-
|
||
Additions
|
233
|
|||
Adjustments
|
(146
|
)
|
||
Payments
|
(87
|
)
|
||
Balance,
March 31, 2007
|
$
|
-
|
Restructuring
charges:
|
||||
Employee
severance and related benefits
|
$
|
4,205
|
||
Contract
termination costs
|
87
|
|||
Total
restructuring charges
|
4,292
|
|||
Other
repositioning costs:
|
||||
Special
termination benefits - early retirement
|
1,728
|
|||
Obsolete
inventory charges
|
276
|
|||
Fixed
asset disposals
|
1,994
|
|||
Pension
curtailment charge
|
663
|
|||
Miscellaneous
other closure costs
|
4,267
|
|||
Total
other repositioning costs
|
8,928
|
|||
Total
restructuring and other repositioning costs
|
$
|
13,220
|
OE-
|
OE-
|
OE-
|
Commercial
|
||||||||||||||||
Americas
|
Asia
|
Europe
|
HVAC&R
|
Other
|
Total
|
||||||||||||||
Balance,
March 31, 2005
|
$
|
22,568
|
$
|
522
|
$
|
8,755
|
$
|
1,599
|
$
|
2,374
|
$
|
35,818
|
|||||||
Acquisitions
|
1,201
|
-
|
-
|
17,266
|
-
|
18,467
|
|||||||||||||
Fluctuations
in foreign currency
|
-
|
-
|
(813
|
)
|
(1,300
|
)
|
84
|
(2,029
|
)
|
||||||||||
Balance,
March 31, 2006
|
23,769
|
522
|
7,942
|
17,565
|
2,458
|
52,256
|
|||||||||||||
Acquisitions
|
11,821
|
-
|
-
|
-
|
-
|
11,821
|
|||||||||||||
Fluctuations
in foreign currency
|
(187
|
)
|
1
|
875
|
1,976
|
287
|
2,952
|
||||||||||||
Balance,
March 31, 2007
|
$
|
35,403
|
$
|
523
|
$
|
8,817
|
$
|
19,541
|
$
|
2,745
|
$
|
67,029
|
March
31, 2007
|
March
31, 2006
|
||||||||||||||||||
Gross
|
Net
|
Gross
|
Net
|
||||||||||||||||
Carrying
|
Accumulated
|
Intangible
|
Carrying
|
Accumulated
|
Intangible
|
||||||||||||||
|
Value |
Amortization
|
Assets
|
Value
|
Amortization
|
Assets
|
|||||||||||||
Amortized
intangible assets:
|
|||||||||||||||||||
Patents
and product technology
|
$
|
3,951
|
$
|
(3,437
|
)
|
$
|
514
|
$
|
3,951
|
$
|
(3,175
|
)
|
$
|
776
|
|||||
Trademarks
|
10,523
|
(1,301
|
)
|
9,222
|
9,679
|
(552
|
)
|
9,127
|
|||||||||||
Other
intangibles
|
535
|
(269
|
)
|
266
|
111
|
(111
|
)
|
-
|
|||||||||||
Total
amortized intangible assets
|
15,009
|
(5,007
|
)
|
10,002
|
13,741
|
(3,838
|
)
|
9,903
|
|||||||||||
Unamortized
intangible assets:
|
|||||||||||||||||||
Tradename
|
1,135
|
-
|
1,135
|
-
|
-
|
-
|
|||||||||||||
Pension
asset
|
-
|
-
|
-
|
2,832
|
-
|
2,832
|
|||||||||||||
Total
intangible assets
|
$
|
16,144
|
$
|
(5,007
|
)
|
$
|
11,137
|
$
|
16,573
|
$
|
(3,838
|
)
|
$
|
12,735
|
Fiscal
Year
|
Estimated
Amortization Expense
|
2008
|
$1,044
|
2009
|
1,042
|
2010
|
786
|
2011
|
713
|
2012
|
702
|
2013
& beyond
|
5,715
|
Type
of issue
|
Interest
rate percentage at March 31, 2007
|
Fiscal
year of maturity
|
March
31, 2007
|
March
31, 2006
|
|||||||||
Denominated
in U.S. dollars:
|
|||||||||||||
Fixed
rate -
|
|||||||||||||
Note
|
4.91
|
2016
|
$
|
75,000
|
$
|
75,000
|
|||||||
Note
|
5.68
|
2018
|
50,000
|
-
|
|||||||||
Note
|
5.68
|
2019
|
25,000
|
-
|
|||||||||
Variable
rate -
|
|||||||||||||
Note
|
6.07
|
2010
|
23,000
|
34,000
|
|||||||||
Revenue
bonds
|
3.77
|
2008
|
3,000
|
3,000
|
|||||||||
Denominated
in foreign currency:
|
|||||||||||||
Fixed
rate -
|
|||||||||||||
Notes
and other debt
|
3.00
|
2020
|
3,005
|
2,873
|
|||||||||
Variable
rate -
|
|||||||||||||
Note
|
2010
|
-
|
36,958
|
||||||||||
179,005
|
151,831
|
||||||||||||
Less
current portion
|
3,149
|
125
|
|||||||||||
Total
long-term debt
|
$
|
175,856
|
$
|
151,706
|
Years
ending March 31
|
|
|
|
|
|
|
|
|
|
2008
|
|
$
|
3,149
|
|
2009
|
|
|
286
|
|
2010
|
|
|
23,194
|
|
2011
|
|
|
216
|
|
2012
|
|
|
239
|
|
2013
& beyond
|
|
|
151,921
|
|
Years
ending March 31
|
2007
|
2006
|
2005
|
|||||||
Gross
interest cost
|
$
|
11,001
|
$
|
7,746
|
$
|
6,477
|
||||
Capitalized
interest on major construction projects
|
(838
|
)
|
(499
|
)
|
(148
|
)
|
||||
Interest
expense
|
$
|
10,163
|
$
|
7,247
|
$
|
6,329
|
Years
ended March 31
|
2007
|
2006
|
|||||
Balance
at beginning of year
|
$
|
10,893
|
$
|
17,831
|
|||
Acquisitions
|
527
|
500
|
|||||
Accruals
for warranties issued in current period
|
10,775
|
8,171
|
|||||
Accruals
(reversals) related to pre-existing warranties
|
887
|
(3,905
|
)
|
||||
Settlements
made
|
(9,341
|
)
|
(8,288
|
)
|
|||
Effect
of exchange rate changes
|
569
|
(469
|
)
|
||||
Spin
off of Aftermarket business
|
-
|
(2,947
|
)
|
||||
Balance
at end of year
|
$
|
14,310
|
$
|
10,893
|
Common
stock
|
Treasury
stock at cost
|
||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
||||||||||
Balance,
March 31, 2004
|
34,366
|
$
|
21,478
|
(289
|
)
|
$
|
(7,492
|
)
|
|||||
Purchase
of treasury stock
|
-
|
-
|
(51
|
)
|
(1,591
|
)
|
|||||||
Stock
options and awards including related tax benefits
|
505
|
316
|
-
|
-
|
|||||||||
Balance,
March 31, 2005
|
34,871
|
21,794
|
(340
|
)
|
(9,083
|
)
|
|||||||
Purchase
of treasury stock
|
-
|
-
|
(64
|
)
|
(2,129
|
)
|
|||||||
Stock
repurchase programs
|
(2,440
|
)
|
(1,525
|
)
|
-
|
-
|
|||||||
Stock
options and awards including related tax benefits
|
779
|
487
|
-
|
-
|
|||||||||
Balance,
March 31, 2006
|
33,210
|
20,756
|
(404
|
)
|
(11,212
|
)
|
|||||||
Purchase
of treasury stock
|
(503
|
)
|
(314
|
)
|
(49
|
)
|
(1,256
|
)
|
|||||
Stock
options and awards including related tax benefits
|
165
|
103
|
-
|
-
|
|||||||||
Balance,
March 31, 2007
|
32,872
|
$
|
20,545
|
(453
|
)
|
$
|
(12,468
|
)
|
March
31
|
2007
|
2006
|
|||||
Unrealized
foreign currency translation adjustments
|
$
|
45,617
|
$
|
20,722
|
|||
Net
loss on derivative instruments designated as cash flow hedge,
net of
tax
|
(1,567
|
)
|
(1,042
|
)
|
|||
Minimum
pension liability adjustments, net of tax
|
-
|
(9,663
|
)
|
||||
Defined
benefit plans
|
(58,829
|
)
|
-
|
||||
Accumulated
other comprehensive (loss) income
|
$
|
(14,779
|
)
|
$
|
10,017
|
Year
ended March 31, 2007
|
||||||||||
Impact
on
|
||||||||||
Fair
|
Intrinsic
|
earnings
from
|
||||||||
value
|
value
|
adoption
of
|
||||||||
method
|
method
|
SFAS
No. 123(R
|
)
|
|||||||
Stock-based
compensation expense effect on:
|
||||||||||
Earnings
from continuing operations before taxes
|
($6,721
|
)
|
($3,176
|
)
|
($3,545
|
)
|
||||
Earnings
from continuing operations
|
($4,118
|
)
|
($1,944
|
)
|
($2,174
|
)
|
||||
Net
earnings
|
($4,118
|
)
|
($1,944
|
)
|
($2,174
|
)
|
||||
Earnings
per share effect:
|
||||||||||
Basic
earnings per share
|
($0.13
|
)
|
($0.06
|
)
|
($0.07
|
)
|
||||
Diluted
earnings per share
|
($0.13
|
)
|
($0.06
|
)
|
($0.07
|
)
|
Years
ended March 31
|
2006
|
2005
|
|||||
Earnings
from continuing operations, as reported
|
$
|
60,752
|
$
|
61,686
|
|||
Compensation
expense for stock awards as reported, net of tax
|
3,878
|
1,833
|
|||||
Stock
compensation expense under fair value method, net of tax
|
(5,716
|
)
|
(4,990
|
)
|
|||
Earnings
from continuing operations, pro forma
|
$
|
58,914
|
$
|
58,529
|
|||
Net
earnings, as reported
|
$
|
7,641
|
$
|
61,662
|
|||
Compensation
expense for stock awards as reported, net of tax
|
3,905
|
1,856
|
|||||
Stock
compensation expense under fair value method, net of tax
|
(5,743
|
)
|
(5,013
|
)
|
|||
Net
earnings, pro forma
|
$
|
5,803
|
$
|
58,505
|
|||
Net
earnings per share from continuing operations (basic), as
reported
|
$
|
1.80
|
$
|
1.81
|
|||
Net
earnings per share from continuing operations (basic), pro
forma
|
$
|
1.75
|
$
|
1.72
|
|||
Net
earnings per share (basic), as reported
|
$
|
0.23
|
$
|
1.81
|
|||
Net
earnings per share (basic), pro forma
|
$
|
0.17
|
$
|
1.72
|
|||
Net
earnings per share from continuing operations (diluted), as
reported
|
$
|
1.78
|
$
|
1.79
|
|||
Net
earnings per share from continuing operations (diluted), pro
forma
|
$
|
1.73
|
$
|
1.70
|
|||
Net
earnings per share (diluted), as reported
|
$
|
0.22
|
$
|
1.79
|
|||
Net
earnings per share (diluted), pro forma
|
$
|
0.17
|
$
|
1.70
|
2007
|
2006
|
2005
|
||||||||
Weighted
average fair value of options
|
$
|
6.98
|
$
|
8.53
|
$
|
9.00
|
||||
Risk-free
interest rate
|
4.76
|
%
|
4.20
|
%
|
3.70
|
%
|
||||
Expected
volatility of the Company's stock
|
27.70
|
%
|
31.20
|
%
|
36.30
|
%
|
||||
Expected
dividend yield on the Company's stock
|
2.40
|
%
|
2.60
|
%
|
2.90
|
%
|
||||
Expected
life of options - years
|
5.0
|
5.0
|
5.0
|
|||||||
Expected
pre-vesting forfeiture rate
|
0
|
%
|
0
|
%
|
0
|
%
|
Years
ended March 31
|
2007
|
2006
|
2005
|
||||||||||||||||
Weighted
|
Weighted
|
Weighted
|
|||||||||||||||||
average
|
average
|
average
|
|||||||||||||||||
exercise
|
exercise
|
exercise
|
|||||||||||||||||
Shares
|
price
|
Shares
|
price
|
Shares
|
price
|
||||||||||||||
Outstanding,
beginning of year
|
2,565
|
$
|
27.10
|
2,800
|
$
|
26.93
|
2,882
|
$
|
26.08
|
||||||||||
Granted
|
247
|
27.22
|
329
|
25.82
|
351
|
31.47
|
|||||||||||||
Exercised
|
(140
|
)
|
20.85
|
(506
|
)
|
24.71
|
(404
|
)
|
24.70
|
||||||||||
Forfeited
or expired
|
(169
|
)
|
27.15
|
(58
|
)
|
32.16
|
(29
|
)
|
29.13
|
||||||||||
Outstanding,
end of year
|
2,503
|
$
|
27.46
|
2,565
|
$
|
27.10
|
2,800
|
$
|
26.93
|
||||||||||
Exercisable,
end of year
|
2,495
|
$
|
27.46
|
2,514
|
$
|
27.04
|
2,787
|
$
|
26.91
|
Options
Outstanding
|
Options
Exercisable
|
|||||||||||||||||||||
|
Weighted
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
average
|
|
Weighted
|
|
|
|
|
|
Weighted
|
|
|
|
|||||||
|
|
|
|
remaining
|
|
average
|
|
Aggregate
|
|
|
|
average
|
|
Aggregate
|
|
|||||||
|
|
|
|
contractual
|
|
exercise
|
|
intrinsic
|
|
|
|
exercise
|
|
intrinsic
|
|
|||||||
Range
of exercise prices
|
|
Shares
|
|
life
(years)
|
|
price
|
|
value
|
|
Shares
|
|
price
|
|
value
|
||||||||
$9.62
- $14.43
|
10
|
2.5
|
$
|
10.09
|
$
|
135
|
10
|
$
|
10.09
|
$
|
135
|
|||||||||||
$16.12
- $21.17
|
261
|
5.8
|
19.63
|
854
|
261
|
19.63
|
854
|
|||||||||||||||
$22.24
- $27.89
|
878
|
5.6
|
24.58
|
199
|
870
|
24.56
|
199
|
|||||||||||||||
$28.48
- $33.74
|
1,354
|
5.7
|
30.97
|
-
|
1,354
|
30.97
|
-
|
|||||||||||||||
$9.62
- $33.74
|
2,503
|
5.6
|
$
|
27.46
|
$
|
1,188
|
2,495
|
$
|
27.46
|
$
|
1,188
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Intrinsic
value of stock options exercised
|
$
|
571
|
$
|
5,182
|
$
|
2,652
|
||||
Proceeds
from stock options exercised
|
$
|
2,914
|
$
|
12,501
|
$
|
9,940
|
||||
Tax
benefits realized from non-qualified stock options
|
||||||||||
and
disqualified incentive stock option exercises
|
$
|
145
|
$
|
1,486
|
$
|
798
|
Years
ended March 31
|
2007
|
2006
|
2005
|
||||||||||||||||
Weighted
|
Shares
|
Weighted
|
Shares
|
Weighted
|
Shares
|
||||||||||||||
average
|
subject
to
|
average
|
subject
to
|
average
|
subject
to
|
||||||||||||||
price
|
restrictions
|
price
|
restrictions
|
price
|
restrictions
|
||||||||||||||
Non-vested
at beginning of year
|
$
|
27.41
|
433
|
$
|
25.84
|
245
|
$
|
23.17
|
214
|
||||||||||
Granted
|
26.42
|
68
|
28.72
|
272
|
30.21
|
102
|
|||||||||||||
Vested
|
26.57
|
(157
|
)
|
27.09
|
(84
|
)
|
24.01
|
(71
|
)
|
||||||||||
Forfeited
|
26.77
|
(43
|
)
|
-
|
-
|
-
|
-
|
||||||||||||
Non-vested
at end of year
|
$
|
27.71
|
301
|
$
|
27.41
|
433
|
$
|
25.84
|
245
|
May
2006
|
May
2005
|
||||||
Grant
|
Grant
|
||||||
Expected
life of award - years
|
3
|
3
|
|||||
Risk-free
interest rate
|
4.96
|
%
|
3.75
|
%
|
|||
Expected
volatility of the Company's stock
|
31.40
|
%
|
40.70
|
%
|
|||
Expected
dividend yield on the Company's stock
|
2.19
|
%
|
2.13
|
%
|
|||
Expected
forfeiture rate
|
1.50
|
%
|
1.50
|
%
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Sales
:
|
||||||||||
Original
Equipment – Americas
|
$
|
742,552
|
$
|
681,954
|
$
|
590,028
|
||||
Original
Equipment – Asia
|
218,892
|
206,885
|
116,431
|
|||||||
Original
Equipment – Europe
|
588,746
|
539,141
|
495,581
|
|||||||
Commercial
HVAC&R
|
178,534
|
171,479
|
102,808
|
|||||||
Other
|
39,796
|
34,845
|
37,635
|
|||||||
Segment
sales
|
1,768,520
|
1,634,304
|
1,342,483
|
|||||||
Corporate
and administrative
|
4,500
|
3,358
|
3,829
|
|||||||
Eliminations
|
(15,548
|
)
|
(8,762
|
)
|
(3,896
|
)
|
||||
Sales
from continuing operations
|
$
|
1,757,472
|
$
|
1,628,900
|
$
|
1,342,416
|
||||
Operating
earnings (loss):
|
||||||||||
Original
Equipment – Americas
|
$
|
53,848
|
$
|
82,601
|
$
|
84,009
|
||||
Original
Equipment – Asia
|
(942
|
)
|
(924
|
)
|
1,936
|
|||||
Original
Equipment – Europe
|
61,962
|
71,767
|
61,923
|
|||||||
Commercial
HVAC&R
|
7,743
|
15,131
|
13,382
|
|||||||
Other
|
(8,110
|
)
|
(15,200
|
)
|
(11,301
|
)
|
||||
Segment
earnings
|
114,501
|
153,375
|
149,949
|
|||||||
Corporate
and administrative
|
(74,791
|
)
|
(64,948
|
)
|
(54,670
|
)
|
||||
Eliminations
|
13
|
141
|
139
|
|||||||
Other
items not allocated to segments
|
(436
|
)
|
1,972
|
2,499
|
||||||
Earnings
from continuing operations
|
||||||||||
before
income taxes
|
$
|
39,287
|
$
|
90,540
|
$
|
97,917
|
March
31
|
2007
|
2006
|
|||||
Assets:
|
|||||||
Original
Equipment – Americas
|
$
|
323,703
|
$
|
259,438
|
|||
Original
Equipment – Asia
|
163,836
|
155,596
|
|||||
Original
Equipment – Europe
|
369,374
|
335,508
|
|||||
Commercial
HVAC&R
|
97,619
|
94,108
|
|||||
Other
|
15,112
|
21,752
|
|||||
Corporate
and administrative
|
149,789
|
194,271
|
|||||
Eliminations
|
(17,860
|
)
|
(8,578
|
)
|
|||
Total
assets
|
$
|
1,101,573
|
$
|
1,052,095
|
March
31
|
2007
|
2006
|
2005
|
|||||||
Capital
expenditures:
|
||||||||||
Original
Equipment – Americas
|
$
|
28,825
|
$
|
19,945
|
$
|
18,654
|
||||
Original
Equipment – Asia
|
8,681
|
5,504
|
2,916
|
|||||||
Original
Equipment – Europe
|
22,096
|
28,063
|
33,989
|
|||||||
Commercial
HVAC&R
|
6,824
|
3,946
|
3,959
|
|||||||
Other
|
1,270
|
3,486
|
3,709
|
|||||||
Corporate
and administrative
|
15,114
|
18,341
|
3,100
|
|||||||
Eliminations
|
(58
|
)
|
-
|
-
|
||||||
Capital
expenditures - continuing operations
|
82,752
|
79,285
|
66,327
|
|||||||
Capital
expenditures - discontinued operations
|
-
|
585
|
2,240
|
|||||||
Total
capital expenditures
|
$
|
82,752
|
$
|
79,870
|
$
|
68,567
|
March
31
|
2007
|
2006
|
2005
|
|||||||
Depreciation
and amortization expense:
|
||||||||||
Original
Equipment – Americas
|
$
|
23,315
|
$
|
22,628
|
$
|
20,797
|
||||
Original
Equipment – Asia
|
6,564
|
6,370
|
3,623
|
|||||||
Original
Equipment – Europe
|
25,246
|
23,249
|
20,732
|
|||||||
Commercial
HVAC&R
|
4,501
|
3,831
|
2,146
|
|||||||
Other
|
1,390
|
1,901
|
3,922
|
|||||||
Corporate
and administrative
|
10,187
|
8,722
|
9,918
|
|||||||
Eliminations
|
(99
|
)
|
(114
|
)
|
(133
|
)
|
||||
Depreciation
and amortization expense - continuing operations
|
71,104
|
66,587
|
61,005
|
|||||||
Depreciation
and amortization expense - discontinued operations
|
-
|
1,594
|
5,171
|
|||||||
Total
depreciation and amortization expense
|
$
|
71,104
|
$
|
68,181
|
$
|
66,176
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Net
sales by country:
|
||||||||||
United
States
|
$
|
812,407
|
$
|
831,324
|
$
|
717,925
|
||||
Germany
|
402,505
|
379,074
|
336,554
|
|||||||
South
Korea
|
209,237
|
202,640
|
114,755
|
|||||||
Other
|
333,323
|
215,862
|
173,182
|
|||||||
Total
net sales
|
$
|
1,757,472
|
$
|
1,628,900
|
$
|
1,342,416
|
March
31
|
2007
|
2006
|
|||||
Long-lived
assets:
|
|||||||
United
States
|
$
|
248,379
|
$
|
309,412
|
|||
Germany
|
176,077
|
161,487
|
|||||
South
Korea
|
81,895
|
77,888
|
|||||
Other
|
138,499
|
91,259
|
|||||
Eliminations
|
(134
|
)
|
(146
|
)
|
|||
Total
long-lived assets
|
$
|
644,716
|
$
|
639,900
|
Years
ended March 31
|
2007
|
2006
|
2005
|
|||||||
Modules/packages
|
$
|
480,120
|
$
|
450,710
|
$
|
416,931
|
||||
Oil
coolers
|
228,933
|
223,329
|
225,060
|
|||||||
Vehicular
air conditioning
|
232,334
|
226,689
|
140,663
|
|||||||
Charge-air
coolers
|
192,398
|
206,034
|
160,183
|
|||||||
Radiators
|
243,238
|
172,693
|
118,154
|
|||||||
EGR
coolers
|
144,115
|
147,953
|
134,977
|
|||||||
Building
HVAC
|
150,741
|
141,144
|
79,599
|
|||||||
Electronics
|
35,191
|
33,278
|
35,594
|
|||||||
Other
|
50,402
|
27,070
|
31,255
|
|||||||
Total
net sales
|
$
|
1,757,472
|
$
|
1,628,900
|
$
|
1,342,416
|
Cash
|
$
|
1,239
|
||
Trade
receivables - net
|
3,866
|
|||
Inventories
|
3,696
|
|||
Property,
plant and equipment - net
|
2,400
|
|||
Goodwill
|
2,745
|
|||
Other
assets
|
137
|
|||
Total
assets
|
14,083
|
|||
Accounts
payable
|
1,596
|
|||
Accured
compensation and employee benefits
|
824
|
|||
Other
liabilities
|
1,152
|
|||
Total
liabilities
|
3,572
|
|||
Net
assets
|
$
|
10,511
|
Fiscal
2007 quarters ended
|
June
|
Sept.
|
Dec.
|
March
|
|||||||||
Net
sales
|
$
|
430,393
|
$
|
437,512
|
$
|
467,927
|
$
|
421,640
|
|||||
Gross
profit
|
76,096
|
68,511
|
78,964
|
58,281
|
|||||||||
Earnings
(loss) from continuing operations (a) (b) (c) (d)
|
16,297
|
12,369
|
16,346
|
(2,750
|
)
|
||||||||
Net
earnings (loss)
|
16,367
|
12,369
|
16,346
|
(2,750
|
)
|
||||||||
Earnings
(loss) per share of common stock from continuing
operations:
|
|||||||||||||
Basic
|
$
|
0.51
|
$
|
0.38
|
$
|
0.51
|
$
|
(0.09
|
)
|
||||
Diluted
|
0.51
|
0.38
|
0.51
|
(0.09
|
)
|
||||||||
Net
earnings (loss) per share of common stcok
|
|||||||||||||
Basic
|
$
|
0.51
|
$
|
0.38
|
$
|
0.51
|
$
|
(0.09
|
)
|
||||
Diluted
|
0.51
|
0.38
|
0.51
|
(0.09
|
)
|
||||||||
Fiscal
2006 quarters ended
|
June
|
Sept.
|
Dec.
|
March
|
|||||||||
Net
sales
|
$
|
396,838
|
$
|
404,152
|
$
|
411,030
|
$
|
416,880
|
|||||
Gross
profit
|
80,272
|
79,786
|
80,212
|
69,336
|
|||||||||
Earnings
from continuing operations (e) (f) (g) (h)
|
20,698
|
14,322
|
13,075
|
12,657
|
|||||||||
Net
earnings (loss)
|
20,751
|
(39,342
|
)
|
13,518
|
12,714
|
||||||||
Earnings
per share of common stock from continuing operations:
|
|||||||||||||
Basic
|
$
|
0.60
|
$
|
0.42
|
$
|
0.39
|
$
|
0.39
|
|||||
Diluted
|
0.60
|
0.41
|
0.38
|
0.38
|
|||||||||
Net
earnings (loss) per share of common stock
|
|||||||||||||
Basic
|
$
|
0.60
|
$
|
(1.14
|
)
|
$
|
0.40
|
$
|
0.39
|
||||
Diluted
|
0.60
|
(1.14
|
)
|
0.40
|
0.38
|
|
|
Page
in Form 10-K
|
|
1.
The consolidated financial statements of Modine Manufacturing Company
and
its subsidiaries filed under Item 8:
|
|
Consolidated
Statements of Earnings for the years ended March 31, 2007, 2006
and
2005
|
63
|
Consolidated
Balance Sheets at March 31, 2007 and 2006
|
64
|
Consolidated
Statements of Cash Flows for the years ended March 31, 2007, 2006
and
2005
|
65
|
Consolidated
Statements of Shareholders' Equity and Comprehensive Income (Loss)
for the
years ended March 31, 2007, 2006 and 2005
|
66
|
Notes
to Consolidated Financial Statements 30
- 46
|
67-120
|
Report
of Independent Registered Public Accounting Firm 46
|
121-122
|
2.
Financial Statement Schedules.
|
|
The
following financial statement schedule should be read in conjunction
with
the consolidated financial statements set forth in Item 8:
|
|
Schedule
II -- Valuation and Qualifying Accounts
|
129
|
Schedules
other than those listed above are omitted because they are not
applicable,
not required, or because the required information is included in
the
consolidated financial statements and the notes thereto.
|
|
3.
Exhibits and Exhibit Index.
|
130-134
|
See
the Exhibit Index included as the last part of this report, which
is
incorporated herein by reference. Each management contract and
compensatory plan or arrangement required to be filed as an exhibit
to
this report is identified in the Exhibit Index by an asterisk following
its exhibit number.
|
Date:
May 29, 2007
|
Modine
Manufacturing Company
By:
/s/David
B. Rayburn
David B. Rayburn, President
and Chief Executive Officer
|
/s/David
B. Rayburn
David
B. Rayburn, President, Chief Executive Officer and Director (Principal
Executive Officer)
|
May
29, 2007
|
/s/Bradley
C. Richardson
Bradley
C. Richardson, Executive Vice President, Finance and Chief Financial
Officer (Principal Financial and Accounting Officer)
|
May
29, 2007
|
/s/Dean
R. Zakos
Dean
R. Zakos, Vice President, General Counsel and Secretary
|
May
29, 2007
|
/s/Charles
P. Cooley
Charles
P. Cooley, Director
|
May
29, 2007
|
/s/Richard
J. Doyle
Richard
J. Doyle, Director
|
May
29, 2007
|
/s/Frank
P. Incropera
Frank
P. Incropera, Director
|
May
29, 2007
|
/s/Frank
W. Jones
Frank
W. Jones, Director
|
May
29, 2007
|
/s/Dennis
J. Kuester
Dennis
J. Kuester, Director
|
May
29, 2007
|
/s/Vincent
L. Martin
Vincent
L. Martin, Director
|
May
29, 2007
|
/s/Gary
L. Neale
Gary
L. Neale, Director
|
May
29, 2007
|
/s/Marsha
C. Williams
Marsha
C. Williams, Director
|
May
29, 2007
|
/s/Michael
T. Yonker
Michael
T. Yonker, Director
|
May
29, 2007
|
Column
A
|
Column
B
|
Column
C
|
Column
D
|
Column
E
|
||||||||||||||||||
Additions
|
||||||||||||||||||||||
(1)
|
(2)
|
|||||||||||||||||||||
Description
|
Balance
at Beginning of Period
|
Charged
(Benefit) to Costs and Expenses
|
Charged
to Other Accounts
|
Deductions
|
Balance
at End of Period
|
|||||||||||||||||
2007:
Allowance for Doubtful Accounts
|
$
|
1,511
|
$
|
(188
|
)
|
$
|
606
|
(B
|
)
|
$
|
250
|
(A
|
)
|
$
|
1,679
|
|||||||
Valuation
Allowance for Deferred Tax Assets
|
$
|
3,303
|
$
|
494
|
$
|
47
|
(B
|
)
|
$
|
-
|
$
|
3,844
|
||||||||||
2006:
Allowance for Doubtful Accounts
|
$
|
3,213
|
$
|
(253
|
)
|
$
|
(395
|
)
|
(B
|
)
|
$
|
1,054
|
(A
|
)
|
$
|
1,511
|
||||||
Valuation
Allowance for Deferred Tax Assets
|
$
|
3,871
|
$
|
(462
|
)
|
$
|
(106
|
)
|
(B
|
)
|
$
|
-
|
$
|
3,303
|
||||||||
2005:
Allowance for Doubtful Accounts
|
$
|
3,505
|
$
|
1,695
|
$
|
78
|
(B
|
)
|
$
|
2,065
|
(A
|
)
|
$
|
3,213
|
||||||||
Valuation
Allowance for Deferred Tax Assets
|
$
|
3,132
|
$
|
568
|
$
|
171
|
(B
|
)
|
$
|
-
|
$
|
3,871
|
||||||||||
Notes:
|
||||||||||||||||||||||
(A)
Bad debts charged off during the year
|
||||||||||||||||||||||
(B)
Translation and other adjustments
|
Exhibit
No.
|
Description
|
Incorporated
Herein By
Referenced
To
|
Filed
Herewith
|
2.1
|
Asset
Purchase Agreement between Modine Manufacturing Company and WiniaMando
Inc.
|
Exhibit
2.1 to Registrant’s Current Report on Form 8-K dated April 30,
2004.
|
|
2.2
|
Agreement
and Plan of Merger, dated as of January 31, 2005, by and among
Modine
Manufacturing Company, Modine Aftermarket Holding, Inc., and Transpro,
Inc.
|
Exhibit
2.1 to Registrant's Current Report on Form 8-K dated January 31,
2005
(“Jan. 31, 2005 8-K”).
|
|
2.3
|
Contribution
Agreement, dated as of January 31, 2005, by and among Modine Manufacturing
Company, Modine Aftermarket Holdings, Inc. and Transpro.
Inc.
|
Exhibit
2.2 to Jan. 31, 2005 8-K.
|
|
2.4
|
Share
Purchase Agreement between the shareholders of Airedale International
Air
Conditioning Limited, Modine U.K. Dollar Limited and Modine Manufacturing
Company.
|
Exhibit
2(e) to Registrant’s Form 10-K for the fiscal year ended March 31, 2005
(“2005 10-K”).
|
|
2.5
|
Amendment
to Agreement and Plan of Merger, dated as of June 16, 2005, by
and among
Modine Manufacturing Company, Modine Aftermarket Holding, Inc.,
and
Transpro, Inc.
|
Exhibit
2.1 to Registrant’s Current Report on Form 8-K dated June 16,
2005.
|
|
3.1
|
Restated
Articles of Incorporation.
|
Exhibit
3(a) to Registrant’s Form 10-Q for the quarter ended June 26,
2005.
|
|
3.2
|
Bylaws.
|
X
|
|
4.1
|
Specimen
Uniform Denomination Stock Certificate of the Registrant.
|
Exhibit
4(a) to Form 10-K for the fiscal year ended March 31, 2003 ("2003
10-K").
|
|
4.2
|
Restated
Articles of Incorporation.
|
See
Exhibit 3.1 hereto.
|
|
4.3**
|
Amended
and Restated Bank One Credit Agreement dated October 27,
2004.
|
Exhibit
4(c) to Registrant’s Form 10-Q for the quarter ended September 26,
2004.
|
|
4.4
|
Note
Purchase Agreement, dated as of September 29, 2005, among the Registrant
and the Purchasers for the issuance and sale by the Registrant
of 4.91%
Senior Notes due September 29, 2015 in an aggregate principal amount
of
$75,000,000.
|
Exhibit
10.1 to Registrant’s Current Report on Form 8-K dated September 29,
2005.
|
|
4.5
|
Credit
Agreement, dated as of December 13, 2005, among Modine Holding
GmbH as
Borrower, the Registrant as Parent and a Guarantor, certain subsidiaries
of the Registrant, as Guarantors, J.P. Morgan Europe Limited, as
Agent,
J.P. Morgan plc as Lead Arranger and the following financial institutions:
J.P. Morgan Europe Limited and SunTrust Bank, in the aggregate
principal
amount of €71,000,000.
|
Exhibit
10.1 to Registrant’s Current Report on Form 8-K dated December 19,
2005.
|
|
4.6
|
Note
Purchase Agreement among Modine Manufacturing Company (“Modine”) and the
Purchasers for the issuance and sale by Modine of 5.68% Senior
Notes
Series A due December 7, 2017 and Series B due December 7, 2018
in an
aggregate principal amount of $75,000,000.
|
Exhibit
10.1 to Registrant’s Current Report on Form 8-K dated December 7,
2006
|
|
10.1*
|
Director
Emeritus Retirement Plan effective April 1, 1992 (and frozen as
of July 1,
2000).
|
Exhibit
10(a) to Registrant’s Form 10-K for the fiscal year ended March 31, 2002
(“2002 10-K”).
|
|
10.2*
|
Employment
Agreement between the Registrant and David B. Rayburn dated May
16,
2001.
|
Exhibit
10(c) to Registrant’s Form 10-K for the fiscal year ended March 31, 2001
(“2001 10-K”).
|
|
10.3*
|
Employment
Agreement between the Registrant and Bradley C. Richardson dated
May 12,
2003.***
|
||
10.4*
|
Employment
Agreement between the Registrant and Anthony C. De Vuono dated
May 16,
2001.***
|
||
10.5*
|
Change
in Control and Termination Agreement between the Registrant and
David B.
Rayburn.
|
Exhibit
10(e) to Registrant’s Form 10-K for the fiscal year ended March 31, 2004
(“2004 10-K”).
|
|
10.6*
|
Form
of Change in Control and Termination Agreement (amended and restated)
between the Registrant and officers other than David B. Rayburn,
Thomas A.
Burke and Bradley C. Richardson.
|
Exhibit
10(f) to 2004 10-K.
|
|
10.7*
|
Form
of Executive Employment Agreement between the Registrant and Thomas
A.
Burke.
|
Exhibit
10.1 to Registrant’s Current Report on Form 8-K dated May 31,
2005.
|
|
10.8*
|
Employment
Agreement, dated April 20, 2006, between Modine Holding GmbH and
Klaus
Feldmann.
|
Exhibit
10 to Registrant’s Current Report on Form 8-K dated April 20,
2006.
|
|
10.9*
|
1985
Incentive Stock Plan (as amended).
|
Exhibit
10(j) to 2002 10-K.
|
|
10.10*
|
2005
Stock Incentive Plan for Non-Employee Directors.
|
Appendix
A to Registrant’s Proxy Statement for the 2005 Annual Meeting dated June
15, 2005.
|
|
10.11*
|
Executive
Supplemental Retirement Plan (as amended).
|
Exhibit
10(f) to Registrant's Form 10-K for the fiscal year ended March
31, 2000
("2000 10-K").
|
|
10.12*
|
Modine
Deferred Compensation Plan (as amended).
|
Exhibit
10(y) to 2003 10-K.
|
|
10.13*
|
1994
Incentive Compensation Plan (as amended).
|
Exhibit
10(o) to 2002 10-K.
|
|
10.14*
|
Form
of Incentive and Non-Qualified Stock Option Agreements.
|
Exhibit
10(q) to 2001 10-K.
|
|
10.15*
|
1994
Stock Option Plan for Non-Employee Directors (as amended).
|
Exhibit
10(p) to 2002 10-K.
|
|
10.16*
|
Form
of Stock Option Agreement (for 1994 Stock Option Plan for Non-Employee
Directors).
|
Exhibit
10(l) to 2000 10-K.
|
|
10.17*
|
2000
Stock Option Plan for Non-Employee Directors.
|
Exhibit
10(ac) to 2001 10-K.
|
|
10.18*
|
Form
of Director's Stock Option Agreement (for 2000 Stock Option Plan
for
Non-Employee Directors).
|
Exhibit
10(ad) to 200110-K.
|
|
10.19*
|
Modine
Manufacturing Company Stock Option Plan for Thermacore Employees
under the
DTX Corporation 1995 Stock Option Plan.
|
Exhibit
10(ae) to 2001 10-K.
|
|
10.20*
|
Modine
Manufacturing Company Stock-Based Compensation Plan for Thermacore
Employees under the DTX Corporation 1997 Plan.
|
Exhibit
10(af) to 2001 10-K.
|
|
10.21*
|
Form
of Stock Option Agreement pertaining to Stock Option and Stock-Based
Compensation Plan for Thermacore Employees.
|
Exhibit
10(ag) to 2001 10-K.
|
|
10.22*
|
2002
Incentive Compensation Plan.
|
Exhibit
A to the Registrant's Proxy Statement dated June 7, 2002.
|
|
10.23*
|
Board
of Directors Deferred Compensation Plan.
|
Exhibit
10(eee) to 2003 10-K.
|
|
10.24*
|
Form
of Stock Award Plan.****
|
Exhibit
10(p) to 2001 10-K.
|
|
10.25*
|
Description
of Modine’s Management Compensation Program.
|
Exhibit
10(w) to Registrant’s Form 10-K for the fiscal year ended March 31, 2005.
|
|
21
|
List
of subsidiaries of the Registrant.
|
X
|
|
23
|
Consent
of independent registered public accounting firm.
|
X
|
|
31.1
|
Certification
of David B. Rayburn, Chief Executive Officer, pursuant to Section
302 of
the Sarbanes-Oxley Act of 2002.
|
X
|
|
31.2
|
Certification
of Bradley C. Richardson, Chief Financial Officer, pursuant to
Section 302
of the Sarbanes-Oxley Act of 2002.
|
X
|
|
32.1
|
Certification
of David B. Rayburn, Chief Executive Officer, pursuant to Section
906 of
the Sarbanes-Oxley Act of 2002.
|
X
|
|
32.2
|
Certification
of Bradley C. Richardson, Chief Financial Officer, pursuant to
Section 906
of the Sarbanes-Oxley Act of 2002.
|
X
|