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Badger Meter Inc Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: August 5, 2010 05:21PM
Badger Meter Inc (BMI) filed Quarterly Report for the period ended 2010-06-30. Badger Meter Inc has a market cap of $612.7 million; its shares were traded at around $40.9 with a P/E ratio of 24.1 and P/S ratio of 2.5. The dividend yield of Badger Meter Inc stocks is 1.2%. Badger Meter Inc had an annual average earning growth of 19.3% over the past 10 years. GuruFocus rated Badger Meter Inc the business predictability rank of 3-star.BMI is in the portfolios of Bill Frels of Mairs & Power Inc. .
Highlight of Business Operations:
On April 1, 2010, the Company purchased Cox Instruments, LLC, of Scottsdale, Arizona and its subsidiary Flow Dynamics, Inc. for $7.8 million. Cox Instruments and Flow Dynamics manufacture and market precision high performance flow meters that are used in demanding applications such as aerospace, custody transfer and flow measurement test stands. The Company merged the two entities into a wholly-owned subsidiary named Cox Flow Measurement, Inc. on April 1, 2010 and will treat it as a product line for management purposes. The Companys preliminary allocation of the purchase price at June 30, 2010 included $0.6 million of cash, plus approximately $0.7 million of accounts receivable, $1.1 million of inventory, $0.3 million of fixed assets, $3.4 million of intangibles, $2.9 million of goodwill and $1.2 million of liabilities.
As a result of the above mentioned items, net earnings for the three months ended June 30, 2010 were $8.0 million compared to $7.8 million in the three month period ended June 30, 2009. On a diluted basis, earnings per share were $0.53 for the second quarter of 2010 compared to $0.52 for the same period in 2009.
As a result of the above mentioned items, net earnings for the six months ended June 30, 2010 were $13.4 million compared to $14.7 million in the six-month period ended June 30, 2009. On a diluted basis, earnings per share were $0.89 for the first six months of 2010 compared to $0.99 for the same period in 2009.
Net property, plant and equipment at June 30, 2010 increased by $1.1 million compared to the balance at December 31, 2009 due to the timing of depreciation expense and capital expenditures. Included in the $1.1 million increase was $0.7 million related to land obtained from the settlement of a legal suit and $0.3 million related to the acquisition of Cox Flow Measurement.
The increase in intangible assets from $23.6 million at December 31, 2009 to $26.3 million at June 30, 2010 is due to the Cox Flow Measurement acquisition discussed above, offset somewhat by amortization expense. Other assets increased to $7.2 million at June 30, 2010 from $5.8 million at December 31, 2009 due primarily to the Company investing $1.5 million to purchase a small ownership percentage in an emerging technology company. Goodwill increased to $9.8 million at June 30, 2010 from $7.0 million at December 31, 2009 due to the Cox Flow Measurement acquisition. The Company performs its annual impairment test for intangibles and goodwill in the fourth quarter. The Company did not identify any indicators of impairment to date in 2010 that would require interim valuations.
Payables increased to $17.4 million at June 30, 2010 from $10.8 million at December 31, 2009 primarily due to the timing of payments. Accrued compensation and employee benefits at June 30, 2010 increased to $7.2 million from $6.1 million at December 31, 2009 due to the current year accruals for employee incentive compensation, offset somewhat by the payment of employee incentive compensation amounts earned at December 31, 2009.
Stocks Discussed: BMI,