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SPX Corp. Reports Operating Results (10-K/A)

August 10, 2010 | About:
10qk

10qk

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SPX Corp. (SPW) filed Amended Annual Report for the period ended 2009-12-31.

Spx Corp. has a market cap of $3.14 billion; its shares were traded at around $62.88 with a P/E ratio of 17 and P/S ratio of 0.6. The dividend yield of Spx Corp. stocks is 1.6%. Spx Corp. had an annual average earning growth of 3.7% over the past 10 years.SPW is in the portfolios of Pioneer Investments, James Barrow of Barrow, Hanley, Mewhinney & Strauss, PRIMECAP Management, Bruce Kovner of Caxton Associates, George Soros of Soros Fund Management LLC, Jeremy Grantham of GMO LLC.

Highlight of Business Operations:

(3)In 2009, 2008, 2007, 2006 and 2005, we incurred net special charges of $73.1, $17.2, $5.2, $3.8 and $7.4, respectively, associated with restructuring initiatives to consolidate manufacturing and other facilities, as well as asset impairments. In 2005, these charges were net of a credit of $7.9 relating to a gain on the sale of land in Milpitas, CA, resulting in the finalization of a previously initiated restructuring action. See Note 6 to our consolidated financial statements for further details. 2

In 2009, we recorded a charge of $187.7 related to the impairment of goodwill and $1.0 related to the impairment of other intangible assets for our Service Solutions reporting unit. Additionally, we recorded a charge of $6.1 related to the impairment of trademarks at one of our Thermal Equipment and Services businesses.

(4)In 2008, we recorded a charge of $9.5 relating to the settlement of a lawsuit arising out of a 1997 business disposition. In 2006, we recorded a charge of $20.0 relating to the settlement of a lawsuit with VSI Holdings, Inc. (5)Interest expense, net included losses on early extinguishment of debt of $3.3 in 2007 and $113.6 in 2005. (6)During 2009, we recorded an income tax benefit of $4.9 associated with the loss on an investment in a foreign subsidiary. In addition, we recorded income tax benefits of $7.9 during 2009 related to a reduction in liabilities for uncertain tax positions associated with statute expirations and audit settlements in certain tax jurisdictions. Lastly, the tax benefit associated with the aggregate impairment charges of $194.8 noted above was only $25.6. During 2008, we recorded an income tax benefit of $25.6 associated with the audit settlement of our federal income tax returns for 2003 through 2005. In addition, the tax benefit associated with the $123.0 of impairment charges was only $3.6.

During 2007, in connection with the resolution of certain matters related to our federal income tax returns for the years 1995 through 2002, we recorded an income tax benefit of $16.8. In addition, during 2007, we recorded an income tax benefit of $11.5 associated with a reduction in the statutory tax rates in Germany and the United Kingdom. Lastly, during 2007, we recorded an income tax benefit of $3.5 associated with the settlement of certain income tax matters in the United Kingdom, a $4.9 benefit for the reduction of taxes accrued in prior years, and a $3.7 refund in China related to an earnings reinvestment plan.

(7)During 2006, we recorded an income tax benefit of $33.2 to "Gain (loss) on disposition of discontinued operations, net of tax" relating to the sale of our Dock Products business. In the first quarter of 2010, it was determined that the income tax benefit recorded during 2006 to "Gain (loss) on disposition of discontinued operations, net of tax" was overstated by $20.0 resulting from an incorrect calculation of the Dock Products' income tax basis. To correct this misstatement, we have adjusted the following within the selected financial data included herein (as compared to that which was presented in the Form 10-K for the year ended December 31, 2009): Increased the 2006 loss from discontinued operations, net of tax, by $20.0; Decreased 2006 net income and net income attributable to SPX Corporation common shareholders by $20.0; and Reduced shareholders' equity as of December 31, 2009, 2008, 2007, and 2006 by $20.0. 3

We have audited the accompanying Consolidated Balance Sheets of SPX CORPORATION AND SUBSIDIARIES (the "Company") as of December 31, 2009 and 2008, and the related Consolidated Statements of Operations, Shareholders' Equity and Comprehensive Income, and of Cash Flows for each of the three years in the period ended December 31, 2009. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We did not audit the financial statements of EGS Electrical Group, LLC and Subsidiaries ("EGS") for the years ended September 30, 2009, 2008 and 2007, the Company's investment in which is accounted for by use of the equity method (see Note 9 to the consolidated financial statements). The Company's equity in income of EGS for the years ended September 30, 2009, 2008 and 2007 was $28.0 million, $43.7 million and $39.3 million, respectively. The financial statements of EGS were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for such company, is based solely on the report of such auditors.

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