IDEX (IEX) Q4 2007 earnings summary

Executive summary

• FY07 net sales rose 18% to $1,358.6M; organic sales grew 6%, acquisitions added 9% and foreign currency translation added 3%.

• Income from continuing operations increased 17% to $155.9M; diluted continuing EPS rose 15% to $1.90. Net income increased 6% to $155.1M.

Financial highlights

• Gross profit increased 19% to $568.4M; gross margin expanded 50 bps to 41.8%.

• Operating income rose 17% to $255.1M; operating margin held at 18.8% as acquisition, FX, severance, field-service and customer-bankruptcy bad-debt costs offset margin gains.

• Continuing operations generated $198.1M in operating cash flow, up 24%; capital expenditures were $24.5M.

• Q4 net sales were $346.0M, operating income $61.5M, continuing income $38.4M and diluted EPS $0.47.

Outlook and guidance

• FY08 Fluid & Metering Technologies outlook: continued strong global infrastructure investment and process-control demand expected to drive performance.

• Health & Science strength in analytical instrumentation, IVD, biotechnology and new OEM platforms expected to be offset by two maturing OEM contracts.

• Dispensing growth expected from U.S. retailer replenishment and global paint-channel expansion, partly offset by North American housing softness.

• Fire & Safety / Diversified Products expected to benefit from band-clamping applications and global rescue-tools growth, partly offset by North American fire-suppression weakness.