10-KPeriod: FY2008

DOVER Corp Annual Report, Year Ended Dec 31, 2008

Filed February 20, 2009For Securities:DOV

Summary

Dover Corporation's (DOV) 2008 10-K filing highlights a company navigating a challenging economic environment. Revenue saw a modest increase of 3% year-over-year to $7.57 billion, driven by growth in Fluid Management and Industrial Products segments, partially offset by a decline in Engineered Systems. Despite revenue growth, net earnings decreased from $661 million in 2007 to $591 million in 2008, equating to diluted EPS of $3.12, down from $3.26 in the prior year. This decline is partly attributed to a significant loss from discontinued operations. The company's outlook for 2009 is cautious, with management projecting a revenue decline of 11-13% and diluted EPS in the range of $2.75 to $3.05, reflecting expectations of continued economic weakness. Dover is actively managing costs, including workforce reductions, and focusing on maintaining strong free cash flow, which was robust at $834.6 million in 2008. The company's financial condition remains solid, with a decreasing net debt to total capitalization ratio and ample liquidity through its revolving credit facility.

Financial Highlights

50 data points
Beta

Revenue

$7.57B

36.1% Gross Margin

Net Income

$590.83M

7.8% Net Margin

EPS (Diluted)

$3.12

Total Assets

$7.88B

Cash & Equivalents

$549.89M

Free Cash Flow

$834.62M

Financial Statements
Beta
Revenue$7.57B
Cost of Revenue$4.84B
Gross Profit$2.73B
R&D Expenses$189.22M
SG&A Expenses$1.70B
Operating Income$1.03B
Interest Expense$130.15M
Net Income$590.83M
EPS (Basic)$3.13
EPS (Diluted)$3.12
Shares Outstanding (Basic)188.48M
Shares Outstanding (Diluted)189.27M

Key Highlights

  • 1Revenue grew 3% to $7.57 billion in 2008, driven by acquisitions and growth in Fluid Management and Industrial Products.
  • 2Net earnings decreased to $591 million ($3.12 diluted EPS) in 2008 from $661 million ($3.26 diluted EPS) in 2007, impacted by a loss from discontinued operations.
  • 3The company anticipates a challenging 2009, forecasting an 11-13% revenue decline and diluted EPS between $2.75 and $3.05.
  • 4Free cash flow remained strong at $834.6 million in 2008, reflecting effective working capital management.
  • 5Dover made significant share repurchases in 2008, completing its $500 million program.
  • 6The company is implementing cost reduction measures, including workforce reductions of approximately 6% in 2008 and plans for further reductions in 2009.
  • 7The net debt to total capitalization ratio improved to 24.9% in 2008 from 27.3% in 2007.

Frequently Asked Questions

In 2008, Dover Corporation reported a 3% increase in revenue to $7.57 billion. However, net earnings decreased to $591 million, or $3.12 per diluted share, compared to $661 million, or $3.26 per diluted share, in 2007. This decrease was partly due to losses from discontinued operations.

Dover's management provided a cautious outlook for 2009, anticipating an 11-13% decline in revenue and projecting diluted earnings per share to be in the range of $2.75 to $3.05, reflecting the ongoing global economic downturn.

Dover maintained a strong financial position in 2008, generating robust free cash flow of $834.6 million. The company reduced its debt levels, with the net debt to total capitalization ratio improving to 24.9% from 27.3% in the prior year, and completed its $500 million share repurchase program.

The Fluid Management segment saw significant revenue growth (16%) and earnings improvement (27%) driven by strong performance in oil, gas, and power generation markets. The Industrial Products segment also experienced revenue growth (2%), but earnings declined due to weakness in construction and automotive markets. Engineered Systems saw a revenue decline, while Electronic Technologies' revenue was flat.