Gardner Denver Inc, USA

Gardner Denver Inc, USA

Pump Industry Analyst November 2003 ITT Industries Inc, USA Gardner Denver Inc, USA Key Figures (US$ million) Three months ended 30.9 Key Figures...

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Pump Industry Analyst

November 2003

ITT Industries Inc, USA

Gardner Denver Inc, USA

Key Figures (US$ million) Three months ended 30.9

Key Figures (US$ million) Three months ended 30.9

2003

2002

1375.2

1235.1

Cost of Sales and Revenues

903.7

798.8

Revenues Of Which: Pump Products

Research, Development and Engineering Expenses

137.2

130.7

Cost of Sales

Net Income

109.2

120.4

Net Income

2003

2002

Orders Of Which: Pump Products

Sales and Revenues

4109.8

3741.0

Cost of Sales and Revenues

2699.7

2435.4

Research, Development and Engineering Expenses

409.4

386.8

Net Income

295.8

284.8

Sales and Revenues

COMPANY WATCH

Nine months ended 30.9

2003

2002

112.1

102.8

20.5

17.3

78.2

70.3

5.3

4.8

109.2

95.2

18.9

14.5

Nine months ended 30.9 2003

2002

Revenues Of Which: Pump Products

322.9

314.3

51.8

51.0

Cost of Sales

225.1

216.2

14.1

14.9

318.5

300.6

53.4

40.7

Net Income Orders Of Which: Pump Products

COMMENT Third quarter 2003 Fluid Technology (FTC) revenues rose 16% or US$79.4 million to US$564.1 million, driven by a number of factors including organic growth in water/wastewater, recent acquisitions and the positive impact of foreign currency translations. Operating income was up 15% or US$9.4 million to US$74.3 million in the third quarter, while the segment’s operating margin declined 20 basis points, due to restructuring charges. ITT Industries’ water/ wastewater business continues to experience growth, with revenues up 20% and orders up 17%, following a strategy of taking products into new markets. Excluding acquisitions and currency translations, the revenue

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growth for water and wastewater in the third quarter was 10%. During the third quarter the FTC business secured three US$1 million orders for wastewater pumps and services, two from China and one from France. The segment’s Sanitaire filtration division also received US$12 million in system and installation orders from the United Arab Emirates for desalinization plant projects during the quarter. Improved orders for custom industrial pumps in the Middle East and Asia-Pacific regions contributed to the 10% increase in revenue in this business, which more than offset the continued softness in the chemical and pulp and paper markets. ■

COMMENT Gardner Denver CEO Ross Centanni is encouraged by the increase in orders booked in the third quarter and by the feedback on the demand outlook for industrial products in 2004 that the company is currently receiving from its distributors. Demand for well stimulation pumps and pump replacement parts has grown significantly year-over-year. Although orders for drilling pumps have not yet increased appreciably, Centanni still expects demand for petroleum products in 2004 to exceed 2003 levels. “We are positioning drilling pump inventory to capitalize on this projected upturn to minimize

leadtime and capture incremental demand,” confirmed Centanni. Having acquired a small machine shop in Odessa, Texas for US$2.4 million during August 2003, Gardner Denver plans to use this facility to service and repair well stimulation and drilling pumps for the Permian Basin. Overall Gardner Denver expects improved demand for petroleum pumps and replacement parts in 2004, if North American rig counts continue to rise. The company believes that its investments in drilling pump inventory will enable a quick response if further orders are received. ■