Gorman-Rupp Q213 Sales Grow 14.9 Percent, Set Quarterly Record

July 31, 2013

The Gorman-Rupp Co. reported net sales during the second quarter 2013 increased 14.9 percent to a new quarterly record of $106.4 million compared to $92.6 million during the same period in 2012. Domestic sales increased 28.4 percent or $15.4 million while international sales decreased 4.0 percent or $1.6 million. The increase in sales in its water end markets of $10.2 million was primarily due to increased shipments for Gulf Coast flood-control projects and for the agriculture market. Increased shipments for the industrial and OEM markets of $2.9 million were major contributors to the increase in the company’s non-water end-market sales.

Net sales for the six months ended June 30, were a record $198.9 million compared to $195.4 million during the same period in 2012, an increase of 1.8 percent. This increase was partially offset by reduced construction market demand for pumps from rental businesses as compared to the strong sales in the first six months of 2012. The decrease in non-water market sales of $5.7 million was primarily in the OEM market due to reduced shipments related to power generation equipment.

“We are very pleased with our record sales and strong operational performance achieved in the quarter during continued domestic and international economic uncertainties,” said Jeffrey Gorman, president and CEO. “Difficult business conditions still persist in some key end markets the company serves. However, we remain optimistic that significant underlying factors will eventually drive demand upward such as the need for infrastructure improvements, along with global needs for safe drinking water and proper sanitation, and position Gorman-Rupp well in the estimated $50 billion worldwide pump market.”

Operating income was $13.5 million resulting in operating margin of 12.7 percent compared to 12.4 percent in the second quarter 2012. Excluding the pension settlement charge, gross margin was 25.9 percent and 24.6 percent and operating margin was 14.2 percent and 12.4 percent for the second quarters of 2013 and 2012, respectively.

Net income increased 21.1 percent during the quarter to $9.2 million compared to $7.6 million in the second quarter 2012 and earnings per share were $0.43 and $0.36 for the respective periods. During the first six months of 2013 net income was $15.0 million compared to a record $17.8 million in the same period last year and earnings per share were $0.71 and $0.85 for the respective periods.

The company’s backlog of orders was $195.4 million at June 30, compared to $133.7 million a year ago and $143.4 million at December 31, 2012. The increase in backlog reflects the award of the Permanent Canal Closure Project contract of approximately $60.0 million to supply major flood-control pumps to a member of a joint venture construction group for a significant New Orleans flood-control project. The pumps are expected to be shipped beginning in late 2013 through 2016, with the majority of the shipments occurring in 2014 and 2015.

The board of directors of The Gorman-Rupp Co. declared a quarterly cash dividend of $0.10 per share on the common stock of the company, payable Sept. 10, to shareholders of record on Aug. 15. This marks the 254th consecutive quarterly dividend paid by the Mansfield, Ohio-based Gorman-Rupp Co.