Compressed Air Best Practices - June 2008 - (Page 48)

| 06–07/08 Compressed Air Industry PHARMACEUTICALS | WALL STREET WATCH Investments in Additional Capacities With investments in the range of $517 million (377 million Euros), Bosch Rexroth has significantly increased its worldwide production capacity. Investment for 2007 stood at 7% of sales, and the company raised the investment rate once more. Between 2002 and 2006, the investment rate averaged just fewer than 5% of sales, which was already above average for the industry. Bracht also indicated more capacity expansion is planned for 2008. In addition to establishing and expanding its production facilities in Central and Eastern Europe, Bosch Rexroth is also bolstering its capacities in Germany and the U.S. He presented a positive outlook. “Order volumes appear healthy and we are expanding our capacities. Therefore, we are looking ahead to a double-digit percentage increase in sales for 2008,” concluded Bracht. Hamilton, Bermuda, April 30, 2008 — Ingersoll-Rand Company Limited (NYSE:IR), announced that total revenues increased by 9.5% and operating income increased by 18% for the first quarter of 2008 compared with the 2007 first quarter. The company reported net earnings of $181.6 million, or diluted earnings per share (EPS) of $0.66, for the first quarter of 2008. First-quarter net earnings included $211.7 million, or EPS of $0.77 from continuing operations, as well as $30.1 million of cost, equal to EPS of $0.11, from discontinued operations. Discontinued operations represents the net earnings and retained costs of divested businesses and included $24.8 million of after-tax costs related to the sale of the compact equipment business in 2007 and $6.5 million of after-tax cost related to an adverse verdict in a product liability lawsuit in the first quarter of 2008. Net earnings for the 2007 first quarter of $217.5 million, or EPS of $0.70, included EPS of $0.50 from continuing operations and EPS of $0.20 for discontinued operations. “Our first-quarter 2008 performance continued to demonstrate the benefits of our transformed business portfolio, which is characterized by significantly improved product, market and geographic diversity, compared with our previous reliance on capital-intense, heavy machinery businesses,” said Herbert L. Henkel, Chairman, President and Chief Executive Officer. “We are managing our businesses to offset downturns in the domestic market with strong revenue growth from international operations and recurring revenues. As we expected when we began our transformation in 2000, we are better positioned to withstand isolated market downturns, and our continuing focus on innovation, accelerated productivity gains and cost and expense reductions will sustain our ability to grow and deliver consistent financial results.” Additional Highlights for the 2008 First Quarter Revenues: The company's revenues increased by 9.5% to $2,163.3 million compared with revenues of $1,976.2 million for the 2007 first quarter. Currency had a 4% favorable impact on year-over-year revenue gains. First-quarter U.S. revenues increased slightly, while revenues from international operations increased by approximately 21%. Total recurring revenues, which include revenues from parts, service, rental and used equipment, increased by 13% compared with the first quarter of 2007, and accounted for 19% of total revenues. Operating Income and Margin: Operating income increased by 18% to $247.0 million for the first quarter of 2008 compared with $208.6 million the first quarter of 2007. First-quarter operating margin also increased to 11.4% compared with 10.6% last year. Leverage on revenue growth, expense reduction, productivity actions and price increases were partially offset by unfavorable business and product mix and higher commodity costs. First-quarter Business Review: The company classifies its businesses into three reportable segments based on industry and market focus: Climate Control Technologies, Industrial Technologies and Security Technologies. Industrial Technologies is focused on providing solutions to enhance customers’ industrial and energy efficiency and provides equipment and services for compressed air systems, tools, fluid power production and energy generation systems. Total revenues in the first quarter increased by approximately 11% to $743 million. Strength in industrial and process markets outside of North America and revenues from the aftermarket business continued to benefit the Air and Productivity Solutions business. Revenues in the Americas increased by about 4%, primarily due to strong recurring revenues. Air and Productivity Solutions revenues in Europe, Asia and India grew by approximately 30% compared with 2007. Strong Growth in Renewable Energies With production capacity increases for large gear systems, Bosch Rexroth, the automation partner for wind energy plant manufacturers, is preparing to meet the fast-growing demand for renewable energies coming especially from the U.S. and Asia. In its latest study, the Global Wind Energy Council, an association of worldwide wind energy organizations, predicts annual growth rates of more than 20% for the next few years. Bosch Rexroth’s 2007 sales also grew in the solar technology sector, where the company offers innovative installation and automation solutions for more cost-efficient series production of solar cells. Innovations for Increasing Energy Efficiency “As a complete drive and control technologies supplier, Bosch Rexroth has the unique application and engineering expertise for optimizing cross-technology systems,” said Bracht. The company is combining its latest advancements in electrical drives and controls, hydraulics, pneumatics and mechatronics with sustainable energy-efficient system solutions. 48 www.airbestpractices.com http://www.airbestpractices.com

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Compressed Air Best Practices - June 2008 Contents From the Editor Utility-Air News A Pharmaceutical Compressed Air System Audit Talking Dew Point Puerto Rico, Pharmaceuticals and Airequipo Inc. Oil-Free Rotary and Oil-Free Centrifugal Compressor Comparison SMC: Managing Energy and Dew Point in Pneumatic Systems Utility Grade Compressed Air Systems Training Calendar & Product Picks Wall Street Watch Advertiser Index Job Market

Compressed Air Best Practices - June 2008

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