EX-99.1 2 c19567exv99w1.htm PRESS RELEASE exv99w1
 

(GARDNER DENVER LOGO)   Exhibit 99.1
 
PRESS RELEASE
 
FOR IMMEDIATE RELEASE
     
October 24, 2007
  Contact: Christian E. Rothe
Director, Strategic Planning and Development
(217) 228-8224
GARDNER DENVER, INC. REPORTS STRONG RESULTS FOR THE THIRD QUARTER OF 2007:
Excellent Flow-Through Profitability Drives Higher Earnings and Cash Provided by Operating Activities
    Compared to the Third Quarter of 2006:
    Revenues increased 10 percent
 
    Total segment operating earnings(1) grew 21 percent
 
    Net income increased 67 percent
 
    Diluted earnings per share increased 65 percent
    Company Raises Full-Year DEPS Outlook Range to $3.49 to $3.54
 
    Results for the Third Quarter of 2007 included the favorable effect of $10.5 million of non-recurring, non-cash reductions to net deferred tax liabilities, which increased DEPS by $0.19
 
    Cash provided by operating activities exceeded $127 million in the nine-month period of 2007, compared to $87 million in the same period of 2006
QUINCY, IL (October 24, 2007) — Gardner Denver, Inc. (NYSE: GDI) announced that revenues and net income for the three months ended September 30, 2007 were $457.2 million and $53.7 million, respectively. For the nine-month period of 2007, revenues and net income were $1.4 billion and $141.2 million, respectively. Diluted earnings per share (“DEPS”) for the three months ended September 30, 2007 were $0.99, 65 percent higher than the comparable period of 2006. For the nine-month period of 2007, DEPS were $2.62, 46 percent higher than the comparable period of the previous year. Results for the third quarter of 2007 included non-recurring, non-cash reductions to net deferred tax liabilities related to income tax rate changes in Germany and the U.K., which reduced the tax provision by $10.5 million in the third quarter of 2007, increasing DEPS by $0.19. Other than the reduction in the tax provision, the Company’s DEPS improvement for the three months ended September 30, 2007 was primarily attributable to the incremental flow-through profitability of organic revenue growth and operational improvements, including the benefits from acquisition integration.
CEO’s Comments Regarding Results
“I am very pleased with our results for the third quarter, which reflects the diligent efforts of Gardner Denver’s employees throughout the world,” said Ross J. Centanni, Chairman, President and CEO of Gardner Denver. “Demand continued to be strong in end market segments in Europe and Asia, while growth slowed in North America. The year-over-year flow-through profitability in both of our reportable segments was excellent in the third quarter, as we continue to realize the benefit of some of our integration activities. As a result, the Company’s total segment operating earnings(1) grew 21 percent when compared to the same quarter of the previous year, which was

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twice the rate of revenue growth for the same period. The strong flow-through profitability was achieved despite the unfavorable effect of selling fewer drilling pumps in the three-month period of 2007 than in the same period of the previous year. The solid operating performance in the third quarter and the first nine months of 2007 has resulted in more than $127 million in cash provided by operating activities.
“Our Compressor and Vacuum Products segment revenues grew by 10 percent in the third quarter of 2007, when compared to the same period of 2006, due to strong demand in Europe and Asia and favorable changes in currency exchange rates. Orders increased 11 percent in the three months ended September 30, 2007, when compared with the same period of 2006, reflecting good demand for engineered products and OEM applications on a global basis, and low-pressure and vacuum applications in Europe. Order growth for this segment accelerated in the third quarter of 2007, compared to the second quarter of the current year, reflecting strong growth in end market segments, the benefit of reducing manufacturing lead-times as we integrate acquired operations, and favorable changes in currency exchange rates.
“Compressor and Vacuum Products segment operating earnings(1) as a percentage of revenues (segment operating margin(1)) expanded to 11.8 percent in the third quarter, the highest level achieved since 2001,” said Mr. Centanni. “The improvement is the result of the segment’s strong flow-through profitability on organic revenue growth, cost reductions, and the benefits of acquisition integration activities. Further improvement is expected to be realized as the manufacturing integration of the Schopfheim, Germany facilities is completed at the end of this year. In 2008, these process improvements are expected to increase productivity, while reducing lead-times and inventory, generating incremental operating earnings of approximately $6 million annually.
“Fluid Transfer Products segment revenues grew 11 percent in the third quarter of 2007, compared with the third quarter of 2006, primarily due to increased shipments of well stimulation pumps, loading arms and fuel systems,” said Mr. Centanni. “Orders grew 19 percent in the third quarter, compared with the same period of 2006, reflecting strong demand for loading arms and fuel systems. Additionally, as a result of inventory positioned to sell on short lead-times, we realized a slight increase in orders for drilling pumps for the three-month period, compared to the previous year. We intend to continue positioning inventory to take advantage of opportunistic sales in future periods.
“Fluid Transfer Products segment operating margin(1) was 25.7 percent in the third quarter, similar to the same period of the prior year and down from the second quarter of 2007. The decline in segment operating margin(1) from the second quarter of 2007 to the third quarter was expected and reflects the unfavorable mix of selling fewer drilling pumps, since these products generate operating margin in excess of the Fluid Transfer Products segment average.”

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Mr. Centanni continued, “To date in 2007, we used cash provided by operating activities to repay $87.9 million of debt, reducing debt to total capital to 23.2 percent. The Company’s balance sheet and cash generation are strong, which positions us well for strategic acquisitions.”
Outlook
“The Company expects orders for its compressor and vacuum products to remain strong through the balance of 2007, driven by demand in Europe and Asia. We expect to see strong demand through the first half of 2008 for OEM applications and engineered products, as well as marine and European mobile applications. In the second half of 2008, we expect the rate of order growth for compressor and vacuum products to slow slightly. We anticipate revenue growth to continue in 2008 as a result of the order outlook and a reduction in backlog as operational improvements are achieved,” said Mr. Centanni.
“We continue to experience good demand for well stimulation pumps, and our production capacity for these products is sold out through the first half of 2008. Shipments of drilling pumps are expected to continue to decline in 2008, reflecting our outlook for a relatively stable rig count in North America. Although we expect to continue selling drilling pumps for new rigs, upgrades, and replacements, both domestically and internationally, we do not believe this volume will be equivalent to the new rig build completed during the previous three years.
“The Company received certain contracts for liquid natural gas and compressed natural gas loading arms in the second quarter of 2007, which were previously expected to be shipped in early 2008. We now expect to ship approximately half of the contracts in the fourth quarter of 2007,” said Mr. Centanni.
“Based on our current economic outlook, existing backlog, expected operational improvements from integration projects, and a lower effective tax rate, we are raising our full-year 2007 DEPS outlook range to $3.49 to $3.54, with fourth quarter DEPS expected to be $0.87 to $0.92. The midpoint of the DEPS range for the fourth quarter of 2007 ($0.90) represents a 29 percent increase over the same period of 2006. The midpoint of the new DEPS range for the full-year 2007 ($3.52) represents a 41 percent increase over 2006 results. Based on current expectations, the effective tax rate assumed in the DEPS guidance for the fourth quarter of 2007 is 31 percent.”
Mr. Centanni continued, “DEPS are currently expected to be in a range of $3.15 to $3.35 in 2008. The midpoint of this range ($3.25) would be a decline in DEPS from 2007, resulting primarily from the non-recurring, non-cash reduction in net deferred tax liabilities in the current year. Aside from this effect, revenue and segment operating margin(1) increases in Compressor and Vacuum Products and a lower effective tax rate are expected to largely offset the earnings impact of reduced drilling pump shipments in 2008. The Company’s effective tax rate assumed in the 2008 DEPS guidance is 30 percent.

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“The Company invested approximately $32.2 million in capital expenditures during the nine-month period of 2007, compared to $26.3 million in the same period of 2006. Depreciation and amortization expense was approximately $42.8 million for the nine months ended September 30, 2007, compared to $39.5 million in the nine-month period of 2006. For the full-years 2007 and 2008, capital spending is expected to be approximately $45 million to $50 million. Capital spending in 2008 includes planned investments to expand the Company’s manufacturing capacity for compressor and vacuum products in China.”
Revised Presentation of Operating Results for the Reporting of Depreciation and Amortization Expenses
Beginning in the first quarter of 2007, the Company’s presentation of its operating results reflects the inclusion of depreciation and amortization expense in cost of sales and selling and administrative expenses. Total depreciation and amortization was previously reported as a separate caption in the consolidated statements of operations. The 2006 consolidated statements of operations included in this press release have been reclassified to conform to the current presentation. Depreciation and amortization expense included in cost of sales for the three and nine-month periods ended September 30, 2006 was approximately $8.8 million and $28.6 million, respectively. For the three and nine-month periods ended September 30, 2006, depreciation and amortization expense included in selling and administrative expense was approximately $4.1 million and $10.9 million, respectively. This reclassification had no effect on reported consolidated income before tax, net income, per share amounts, reportable segment operating earnings(1) or cash provided by operating activities.
Third Quarter Results
Revenues increased $43.2 million (10 percent) to $457.2 million for the three months ended September 30, 2007, compared to the same period of 2006. Compressor and Vacuum Products segment revenues increased 10 percent for the three-month period of 2007, compared to the previous year, driven by organic growth in most product lines and favorable changes in currency exchange rates. Fluid Transfer Products segment revenues increased 11 percent for the three months ended September 30, 2007, compared to the same period of 2006, primarily resulting from increased volume in well servicing pumps, fuel systems and loading arms and favorable changes in currency exchange rates, partially offset by lower volume in drilling pumps (see Selected Financial Data Schedule).
Compressor and Vacuum Products orders of $376.4 million for the three-month period ended September 30, 2007 were $36.5 million (11 percent) higher than the same period of the previous year due to organic growth and favorable changes in exchange rates. Orders for Fluid Transfer Products of $99.5 million for the three months ended September 30, 2007 were $15.7 million (19 percent) higher than the same period of the previous year due to increased demand for loading arms and fuel systems and favorable changes in currency exchange rates.
Cost of sales as a percentage of revenues improved to 67.4 percent in the three-month period ended September 30, 2007, from 67.7 percent in the same period of 2006. The year-over-year decrease in cost of sales as a percentage of

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revenues was attributable to cost reduction initiatives and leveraging fixed and semi-fixed costs over additional production volume.
As a percentage of revenues, selling and administrative expenses improved to 17.9 percent for the three-month period ended September 30, 2007, compared to 18.8 percent for the same period of 2006, as a result of cost control initiatives and leveraging revenue growth. Selling and administrative expenses increased $4.0 million in the three-month period ended September 30, 2007, as compared to the same period of 2006, to $81.9 million, due to the impact of unfavorable changes in foreign currency exchange rates of approximately $4.1 million. Other selling and administrative expense increases were offset by cost reductions realized through integration initiatives.
Segment operating margin(1) for the Compressor and Vacuum Products segment was 11.8 percent in the three months ended September 30, 2007, compared with 10.2 percent in the same period of 2006. The Fluid Transfer Products segment generated segment operating margin(1) of 25.7 percent in the three months ended September 30, 2007, an improvement from 25.4 percent in the third quarter of 2006. The improved results for each reportable segment reflect significant leveraging of fixed and semi-fixed costs over higher revenues and cost reductions realized to date through acquisition integration initiatives. In the Fluid Transfer Products segment, unfavorable product mix as a result of selling fewer drilling pumps was largely offset by price increases.
The provision for income taxes for the three months ended September 30, 2007 decreased $8.3 million (52 percent) to $7.5 million, compared to the same period of 2006, primarily due to approximately $10.5 million of non-recurring, non-cash reductions to net deferred tax liabilities related to corporate income tax rate changes in Germany and the U.K., which were enacted in the third quarter of 2007 and will become effective in early 2008.
Net income for the three months ended September 30, 2007 increased $21.5 million (67 percent) to $53.7 million, compared to $32.1 million in same period of 2006. DEPS for the three-month period of 2007 were $0.99, 65 percent higher than the comparable period of the previous year as a result of the increased net income. These financial results reflect an effective tax rate of 12.3 percent for the three-month period of 2007, compared to 33.0 percent for the three-month period of 2006.
Nine Month Results
Revenues for the first nine months of 2007 increased $128.9 million (10 percent) to $1.4 billion, compared to $1.2 billion in the same period of 2006. This increase resulted from organic growth and favorable changes in foreign currency exchange rates.
Incremental volume and the related benefit of increased cost leverage over a higher revenue base, and favorable sales mix, contributed to an improvement in cost of sales as a percentage of revenues to 66.7 percent in the first nine

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months of 2007, compared with 67.4 percent in the same period of 2006. Cost of sales in the nine-month period of 2006 includes a non-recurring charge to depreciation expense of approximately $5.5 million associated with the finalization of the fair market value of Thomas Industries’ property plant, and equipment. Declines in productivity related to acquisition integration efforts partially offset these improvements (see Selected Financial Data Schedule).
As a percentage of revenues, selling and administrative expenses improved to 18.0 percent for the first nine months of 2007, from 18.8 percent in the comparable period of 2006, as a result of cost control initiatives and leveraging revenue growth. Selling and administrative expenses increased $13.6 million for the nine-month period ended September 30, 2007 to $245.0 million, primarily due to unfavorable changes in foreign currency exchange rates ($10.9 million). Approximately $3.2 million of the increase is attributable to a non-recurring reduction to amortization expense in the nine-month period of 2006 associated with the finalization of the fair market value of Thomas Industries’ amortizable intangible assets. Other selling and administrative expense increases were offset by cost reductions realized through integration initiatives.
The provision for income taxes for the nine months ended September 30, 2007 was comparable to the same period of 2006. The income tax impact of higher pretax income was offset by a lower effective tax rate for the nine-month period of 2007 (24.9 percent) than in the same period of 2006 (33.0 percent), primarily due to the previously mentioned $10.5 million non-recurring, non-cash net deferred tax liability adjustment recorded in the third quarter of 2007.
Net income increased $45.6 million (48 percent) to $141.2 million for the nine months ended September 30, 2007, compared to $95.6 million for the same period of 2006. Diluted earnings per share for the nine-month period of 2007 were $2.62, 46 percent higher than the same period of the previous year.
Cautionary Statement Regarding Forward-Looking Statements
All of the statements in this release, other than historical facts, are forward-looking statements made in reliance upon the safe harbor of the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements made under the “CEO’s Comments Regarding Results,” “Outlook,” “Third Quarter Results” and “Nine Month Results” sections. As a general matter, forward-looking statements are those focused upon anticipated events or trends, expectations, and beliefs relating to matters that are not historical in nature. Such forward-looking statements are subject to uncertainties and factors relating to the Company’s operations and business environment, all of which are difficult to predict and many of which are beyond the control of the Company. These uncertainties and factors could cause actual results to differ materially from those matters expressed in or implied by such forward-looking statements.

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The following uncertainties and factors, among others, including those set forth under “Risk Factors” in the Company’s Form 10-K for the fiscal year ended December 31, 2006, could affect future performance and cause actual results to differ materially from those expressed in or implied by forward-looking statements: (1) the Company’s exposure to economic downturns and market cycles, particularly the level of oil and natural gas prices and oil and natural gas drilling production, which affect demand for the Company’s petroleum products, and industrial production and manufacturing capacity utilization rates, which affect demand for the Company’s compressor and vacuum products; (2) the risks of large or rapid increases in raw material costs or substantial decreases in their availability, and the Company’s dependence on particular suppliers, particularly iron casting and other metal suppliers; (3) the risks associated with intense competition in the Company’s markets, particularly the pricing of the Company’s products; (4) the ability to effectively integrate acquisitions, including product and manufacturing rationalization initiatives, and realize anticipated cost savings, synergies and revenue enhancements; (5) the ability to attract and retain quality executive management and other key personnel; (6) the ability to continue to identify and complete other strategic acquisitions and effectively integrate such acquisitions to achieve desired financial benefits; (7) economic, political and other risks associated with the Company’s international sales and operations, including changes in currency exchange rates (primarily between the U.S. dollar, the euro, the British pound and the Chinese yuan); (8) the risks associated with potential product liability and warranty claims due to the nature of the Company’s products; (9) the risks associated with environmental compliance costs and liabilities; (10) the risks associated with pending asbestos and silicosis personal injury lawsuits; (11) the risks associated with the Company’s indebtedness and changes in the availability or costs of new financing to support the Company’s operations and future investments; (12) the risks associated with enforcing the Company’s intellectual property rights and defending against potential intellectual property claims; (13) the ability to avoid employee work stoppages and other labor difficulties; (14) changes in discount rates used for actuarial assumptions in pension and other postretirement obligation and expense calculations and market performance of pension plan assets; and (15) the risk of possible future charges if the Company determines that the value of goodwill and other intangible assets, representing a significant portion of its total assets, is impaired. The Company does not undertake, and hereby disclaims, any duty to update these forward-looking statements, although its situation and circumstances may change in the future.
Comparisons of the financial results for the three and nine-month periods ended September 30, 2007 and 2006 follow.
Gardner Denver will broadcast a conference call to discuss third quarter earnings on Thursday, October 25, 2007 at 9:30 a.m. Eastern time through a live webcast. This free webcast will be available in listen-only mode and can be accessed, for up to ninety days following the call, through the Investor Relations page on the Gardner Denver website (www.gardnerdenver.com) or through Thomson StreetEvents at www.earnings.com.

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Gardner Denver, Inc., with 2006 revenues of $1.7 billion, is a leading worldwide manufacturer of reciprocating, rotary and vane compressors, liquid ring pumps and blowers for various industrial and transportation applications, pumps used in the petroleum and industrial market segments, and other fluid transfer equipment serving chemical, petroleum, and food industries. Gardner Denver’s news releases are available by visiting the Investor Relations page on the Company’s website (www.gardnerdenver.com).
 
(1)   Segment operating earnings (defined as revenues less cost of sales and selling and administrative expenses), and segment operating margin (defined as segment operating earnings divided by segment revenues) are indicative of short-term operational performance and ongoing profitability. For a reconciliation of segment operating earnings to consolidated income before income taxes, see “Business Segment Results.”

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GARDNER DENVER, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts and percentages)
(Unaudited)
                                                 
    Three Months Ended             Nine Months Ended        
    September 30,             September 30,        
                    %                     %  
    2007     2006     Change     2007     2006     Change  
 
                                               
Revenues
  $ 457,230     $ 414,028       10     $ 1,358,517     $ 1,229,634       10  
 
                                               
Costs and expenses:
                                               
Cost of sales (2)
    308,050       280,429       10       906,578       829,028       9  
Selling and administrative expenses (2)
    81,881       77,903       5       245,034       231,468       6  
Interest expense
    6,566       8,762       (25 )     20,161       28,574       (29 )
Other income, net
    (443 )     (1,015 )     (56 )     (1,232 )     (2,155 )     (43 )
 
                                       
Total costs and expenses
    396,054       366,079       8       1,170,541       1,086,915       8  
 
                                       
 
                                               
Income before income taxes
    61,176       47,949       28       187,976       142,719       32  
Provision for income taxes
    7,524       15,832       (52 )     46,737       47,106       (1 )
 
                                       
 
                                               
Net income
  $ 53,652     $ 32,117       67     $ 141,239     $ 95,613       48  
 
                                       
 
                                               
Basic earnings per share
  $ 1.00     $ 0.61       64     $ 2.66     $ 1.83       45  
 
                                       
Diluted earnings per share
  $ 0.99     $ 0.60       65     $ 2.62     $ 1.79       46  
 
                                       
 
                                               
Basic weighted average number of shares outstanding
    53,472       52,436               53,124       52,258          
 
                                       
Diluted weighted average number of shares outstanding
    54,236       53,548               53,998       53,405          
 
                                       
 
                                               
Shares outstanding as of September 30
    53,501       52,501                                  
 
                                           
 
(2)   Current and prior year results reflect the inclusion of depreciation and amortization expense in cost of sales and selling and administrative expenses.

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GARDNER DENVER, INC.
CONDENSED BALANCE SHEET ITEMS

(in thousands, except percentages)
(Unaudited)
                                 
                    %    
    9/30/2007   6/30/2007   Change   12/31/2006
 
                               
Cash and equivalents
  $ 88,834     $ 71,483       24     $ 62,331  
Accounts receivable, net
    295,417       301,809       (2 )     261,115  
Inventories, net
    266,790       258,750       3       225,067  
Total current assets
    684,914       666,531       3       579,718  
 
                               
Total assets
    1,898,225       1,832,623       4       1,750,231  
 
                               
Short-term borrowings and current maturities of long-term debt
    23,689       26,639       (11 )     23,789  
Accounts payable and accrued liabilities (3)
    310,081       290,601       7       293,178  
Total current liabilities (3)
    333,770       317,240       5       316,967  
Long-term debt, less current maturities
    302,685       341,091       (11 )     383,459  
 
                               
Total liabilities
    816,897       857,772       (5 )     897,701  
 
                               
Total stockholders’ equity
  $ 1,081,328     $ 974,851       11     $ 852,530  
 
(3)   In connection with the adoption of FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement No. 109” effective January 1, 2007, the liability established for unrecognized income tax benefits relative to matters not expected to be resolved within twelve months at September 30, 2007 has been classified as a non-current liability. The balance sheet at December 31, 2006 was reclassified to conform to the current presentation and, accordingly, approximately $9.4 million of the liability for unrecognized tax benefits at December 31, 2006 was reclassified from current liabilities to non-current liabilities.

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GARDNER DENVER, INC.
BUSINESS SEGMENT RESULTS

(in thousands, except percentages)
(Unaudited)
                                                 
    Three Months Ended             Nine Months Ended        
    September 30,             September 30,        
                    %                     %  
    2007     2006     Change     2007     2006     Change  
Compressor and Vacuum Products
                                               
Revenues
  $ 359,990     $ 326,094       10     $ 1,053,241     $ 969,929       9  
Operating earnings
    42,322       33,332       27       122,634       102,891       19  
% of revenues
    11.8 %     10.2 %             11.6 %     10.6 %        
Orders
    376,365       339,889       11       1,101,934       1,017,846       8  
Backlog
    420,703       356,091       18       420,703       356,091       18  
 
                                               
Fluid Transfer Products
                                               
Revenues
    97,240       87,934       11       305,276       259,705       18  
Operating earnings
    24,977       22,364       12       84,271       66,247       27  
% of revenues
    25.7 %     25.4 %             27.6 %     25.5 %        
Orders
    99,529       83,784       19       299,186       282,315       6  
Backlog
    184,648       189,583       (3 )     184,648       189,583       (3 )
 
                                               
Reconciliation of Segment Results to Consolidated Results
                                               
 
                                               
Compressor and Vacuum Products operating earnings
  $ 42,322     $ 33,332             $ 122,634     $ 102,891          
Fluid Transfer Products operating earnings
    24,977       22,364               84,271       66,247          
 
                                       
Total segment operating earnings
    67,299       55,696               206,905       169,138          
% of revenues
    14.7 %     13.5 %             15.2 %     13.8 %        
Interest expense
    6,566       8,762               20,161       28,574          
Other income, net
    (443 )     (1,015 )             (1,232 )     (2,155 )        
 
                                       
Income before income taxes
  $ 61,176     $ 47,949             $ 187,976     $ 142,719          
 
                                       
% of revenues
    13.4 %     11.6 %             13.8 %     11.6 %        
 
                                       
The Company has determined its reportable segments in accordance with Statement of Financial Accounting Standards No. 131, “Disclosures about Segments of an Enterprise and Related Information.” The Company evaluates the performance of its reportable segments based on income before interest expense, other income, net, and income taxes. Reportable segment operating earnings (defined as revenues less cost of sales and selling and administrative expenses) and segment operating margin (defined as segment operating earnings divided by revenues) are indicative of short-term operating performance and ongoing profitability. Management closely monitors the operating earnings of its reportable segments to evaluate past performance, management performance and compensation, and actions required to improve profitability.

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GARDNER DENVER, INC.
SELECTED FINANCIAL DATA SCHEDULE

(in millions, except percentages)
(Unaudited)
                                 
    Three Months Ended   Nine Months Ended
    September 30,   September 30,
            %           %
    $ Millions   Change   $ Millions   Change
Compressor and Vacuum Products
                               
2006 Revenues
    326.1               969.9          
Effect of currency exchange rates
    15.9       5       45.6       5  
Organic growth
    18.0       5       37.7       4  
 
                               
2007 Revenues
    360.0       10       1,053.2       9  
 
                               
2006 Orders
    339.9               1,017.8          
Effect of currency exchange rates
    16.4       5       48.4       5  
Organic growth
    20.1       6       35.7       3  
 
                               
2007 Orders
    376.4       11       1,101.9       8  
 
                               
Backlog as of 09/30/06
    356.1                          
Effect of currency exchange rates
    27.2       8                  
Organic growth
    37.4       10                  
 
                               
Backlog as of 09/30/07
    420.7       18                  
 
                               
Fluid Transfer Products
                               
2006 Revenues
    87.9               259.7          
Effect of currency exchange rates
    1.9       2       5.3       2  
Organic growth
    7.4       9       40.3       16  
 
                               
2007 Revenues
    97.2       11       305.3       18  
 
                               
2006 Orders
    83.8               282.3          
Effect of currency exchange rates
    2.1       3       8.6       3  
Organic growth
    13.6       16       8.3       3  
 
                               
2007 Orders
    99.5       19       299.2       6  
 
                               
Backlog as of 09/30/06
    189.6                          
Effect of currency exchange rates
    8.0       4                  
Organic growth
    (13.0 )     (7 )                
 
                               
Backlog as of 09/30/07
    184.6       (3 )                
 
                               
Consolidated Revenues
                               
2006
    414.0               1,229.6          
Effect of currency exchange rates
    17.8       4       50.9       4  
Organic growth
    25.4       6       78.0       6  
 
                               
2007
    457.2       10       1,358.5       10  

12