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Robbins & Myers Announces First Quarter 2009 Results

DAYTON, Ohio, Jan. 7 /PRNewswire-FirstCall/ -- Robbins & Myers, Inc. (NYSE: RBN) today reported diluted net earnings per share (DEPS) of $0.50 for its fiscal first quarter ended November 30, 2008, as compared with $0.40 in the prior year first quarter. First quarter 2009 sales increased 3% over the prior year first quarter to $178 million, and orders decreased 5% to $185 million. Excluding the impact from acquired product lines and currency translation, organic sales increased 6% and organic orders increased 4%. The Company experienced a significant strengthening of the US Dollar relative to the currencies of its primary non-US operations.

The Company reported first quarter 2009 earnings before interest, taxes and minority interest (EBIT) of $26 million, 14% higher than the prior year first quarter results, and EBIT margins expanded 140 basis points to 14.8%. Robbins & Myers also reported $30 million of EBITDA in the first quarter of 2009 and $141 million of adjusted EBITDA for the trailing twelve months. Cash flow from operations reflected a $6 million increase over the prior year first quarter, including improvements in net working capital. Capital expenditures were reduced 31% on a comparative basis.

In October 2008, the Company's Board of Directors authorized the repurchase of up to three million of its currently outstanding common shares. The Company announced it repurchased, as treasury shares, approximately two million of its common shares during the quarter for total cash consideration of $39 million. The current authorization allows for the repurchase of approximately one million additional common shares. Share repurchases contributed less than $0.01 to first quarter 2009 DEPS.

"I am pleased to report favorable first quarter results, led by sales of products targeting energy and chemical markets," said Peter C. Wallace, President and Chief Executive Officer of Robbins & Myers, Inc. "Our results also demonstrate the benefits resulting from changes made over the past few years to improve our customer value proposition, operating effectiveness and financial position. Many opportunities remain for continuous improvement across our global business."

"Despite strong first quarter results, most of our product lines experienced order declines late in the quarter, thus providing a cautionary tone as we enter our second quarter. We responded to this initial change in business conditions by reducing discretionary spending, deferring certain capital expenditures and developing plans to further adjust our cost structure. At the same time, we continue to pursue our key 2009 objectives to implement lean, develop our people, invest in our selling efforts, develop new products and applications, and pursue modest acquisitions."

"Robbins & Myers remains financially secure with $74 million of cash, an undrawn senior credit facility, and $33 million of debt. We have revised our expectations for the full year to reflect recent changes in order levels, unfavorable global economic conditions and currency translation headwinds, mitigated somewhat by announced share repurchases and efforts to reduce costs."

The Company announced fiscal 2009 DEPS expectations of $1.80-$2.00, which includes approximately $0.11 of benefit from recent share repurchases. The Company also expects fiscal second quarter 2009 DEPS of $0.40-$0.50, as compared with actual results of $0.47 in the second quarter of fiscal 2008, which included $0.04 of benefits from a facility sale and tax benefits.

First Quarter Results by Segment

All comparisons are made against the comparable year-ago quarterly period unless otherwise stated.

The Fluid Management segment reported first quarter 2009 sales of $82 million, an increase of 14%, and orders of $84 million, a 2% increase. Excluding currency exchange rate effects, organic sales increased 18% and organic orders improved 8% due to favorable demand for products serving energy markets, offset somewhat by weakness in municipal and industrial end markets. EBIT grew 34% to $25 million, and EBIT margins expanded 450 basis points to 30.0%.

The Process Solutions segment reported sales of $72 million in the first quarter, an increase of 2%, and orders of $74 million, a 5% decrease. Excluding the effects of currency exchange rates and an acquisition, organic sales increased 4% and organic orders increased 6%. Several orders for large chemical market projects were secured during the quarter. The segment earned $7 million of EBIT in the first quarter of 2009, and EBIT margins decreased 170 basis points to 9.5% due to an unfavorable product mix, higher project costs and increased operating expenses.

The Romaco segment reported first quarter sales of $23 million, a 23% decrease, and orders of $27 million, down 21%. Excluding the impact from currency exchange rates, organic sales decreased 17% and orders declined 8% on weakness in pharmaceutical markets and order delays. Romaco reported an EBIT loss of $1.4 million during the first quarter of 2009, including $0.5 million of restructuring costs, as compared with EBIT of $1.5 million in the prior year.

Conference Call to Be Held Tomorrow, January 8 at 10:00 AM (EST)

A conference call to discuss these results has been scheduled for 10:00 AM ET Thursday, January 8, 2009, which can be accessed at or by dialing 800-599-9795 (US/Canada) or +1-617-786-2905, using conference ID #14345248. Replays of the call can be accessed by dialing 888-286-8010 (U.S./Canada) or +1-617-801-6888, both using replay ID # 25121411.

About Robbins & Myers

Robbins & Myers, Inc. is a leading supplier of engineered equipment and systems for critical applications in global energy, industrial, chemical and pharmaceutical markets.

In this release the Company refers to various non-GAAP measures, including EBIT, EBITDA (earnings before interest, taxes, depreciation and amortization) and adjusted EBITDA. The Company uses these measures to evaluate its performance and believes these measures are helpful to investors in assessing its performance. Reconciliations of these measures to comparable GAAP measures are provided further below in this release.

In addition to historical information, this press release contains forward-looking statements identified by use of words such as "expects," "anticipates," "believes," and similar expressions. These statements reflect management's current expectations and involve known and unknown risks, uncertainties, contingencies and other factors that could cause actual results, performance or achievements to differ materially from those stated. The most significant of these risks and uncertainties are described in our Form 10-K and Form 10-Q reports filed with the Securities and Exchange Commission and include, but are not limited to: the cyclical nature of some of our markets; a significant decline in capital expenditures in our primary markets; a major decline in oil and natural gas prices; reduced demand due to the general worldwide economic downturn and general credit market crises; increases in competition; changes in the availability and cost of our raw materials; foreign exchange rate fluctuations; work stoppages related to union negotiations; customer order cancellations; business disruptions caused by the implementation of business computer systems; the possibility of product liability lawsuits that could harm our business; events or circumstances which result in an impairment of assets; the potential impact of U.S. and foreign legislation, government regulations, and other governmental action, including those relating to export and import of products and materials, and changes in the interpretation and application of such laws and regulations; the outcome of audit, compliance, administrative or investigatory reviews; and decline in the market value of our pension plans' investment portfolios affecting our financial condition and results of operations. Except as otherwise required by law, we do not undertake any obligation to publicly update or revise these forward-looking statements to reflect events or circumstances after the date hereof.


      (in thousands)                      November 30, 2008   August 31, 2008
         Current Assets:
             Cash and cash equivalents              $74,337          $123,405
             Accounts receivable                    132,857           153,648
             Inventories                            115,648           109,797
             Other current assets                     5,559             8,017
             Deferred taxes                           9,961            13,476

               Total Current Assets                 338,362           408,343

         Goodwill & Other Intangible Assets         260,384           285,759
         Deferred Taxes                              21,398            21,969
         Other Assets                                10,603            10,931
         Property, Plant & Equipment                127,444           137,715
                                                   $758,191          $864,717
         Current Liabilities:
             Accounts payable                       $66,403           $86,012
             Accrued expenses                        87,951           102,876
             Current portion of long-term debt        2,269             3,192

               Total Current Liabilities            156,623           192,080

         Long-Term Debt - Less Current Portion       30,376            30,435
         Deferred Taxes                              42,883            44,628
         Other Long-Term Liabilities                 92,488            97,557
         Shareholders' Equity                       435,821           500,017

                                                   $758,191          $864,717


                                                       Three Months Ended
                                                   November 30,   November 30,
    (in thousands, except per share data)             2008           2007

    Sales                                           $177,971       $173,536
    Cost of sales                                    109,995        110,674

    Gross profit                                      67,976         62,862

    SG&A expenses                                     41,582         39,641

    Income before interest and income taxes           26,394         23,221

    Interest expense, net                                 53            727

    Income before income taxes and minority interest  26,341         22,494

    Income tax expense                                 8,957          7,955

    Minority interest                                    176            601

    Net income                                       $17,208        $13,938

    Net Income Per Share:
       Basic                                           $0.50          $0.41
       Diluted                                         $0.50          $0.40

    Weighted Average Common Shares Outstanding:
       Basic                                          34,429         34,370
       Diluted                                        34,465         34,642


                                                      Three Months Ended
                                                  November 30,    November 30,
    (in thousands)                                   2008            2007
          Fluid Management                           $82,270        $72,355
          Process Solutions                           72,284         70,849
          Romaco                                      23,417         30,332
          Total                                     $177,971       $173,536

     Income Before Interest and Income Taxes (EBIT)
          Fluid Management                           $24,640        $18,448
          Process Solutions                            6,869          7,956
          Romaco                                      (1,443)         1,545
          Corporate and Eliminations                  (3,672)        (4,728)
          Total                                      $26,394        $23,221

     Depreciation and Amortization
          Fluid Management                            $1,796         $1,653
          Process Solutions                            1,685          1,669
          Romaco                                         482            452
          Corporate and Eliminations                     130            222
          Total                                       $4,093         $3,996

          Fluid Management                           $84,427        $82,792
          Process Solutions                           73,681         77,416
          Romaco                                      26,725         33,713
          Total                                     $184,833       $193,921

          Fluid Management                           $61,665        $53,394
          Process Solutions                          114,258        105,481
          Romaco                                      47,676         55,332
          Total                                     $223,599       $214,207


                                                         Three Months Ended
                                                     November 30, November 30,
    (in thousands)                                      2008         2007

    Operating activities:
       Net income                                     $17,208       $13,938
       Depreciation and amortization                    4,093         3,996
       Other, net                                     (21,599)      (24,296)
    Cash used by operating activities                    (298)       (6,362)

    Investing activities:
       Capital expenditures, net of nominal disposals  (3,377)       (4,925)
    Cash used by investing activities                  (3,377)       (4,925)

    Financing activities:
       Payments of long-term debt, net                   (982)         (761)
       Share repurchases                              (39,114)          -
       Other, net                                        (731)        1,894
    Cash (used) provided by financing activities      (40,827)        1,133
    Exchange rate impact on cash                       (4,566)        2,055
    Decrease in cash                                  (49,068)       (8,099)
    Cash at beginning of period                       123,405       116,110
    Cash at end of period                             $74,337      $108,011


                                                             Trailing Twelve
                                        Three Months Ended     Months Ended
                                           November 30,        November 30,
    (dollar amounts in thousands)             2008                 2008

    Net income                              $17,208              $90,672
    Interest expense, net                        53                1,357
    Income taxes                              8,957               40,101
    Minority interest                           176                1,707
    EBIT                                     26,394              133,837

    Minority interest                          (176)              (1,707)
    Depreciation & amortization               4,093               16,346
    EBITDA                                   30,311              148,476

    Special items:
        Property sale gain                        -               (1,934)
        Business disposition gain                 -               (5,697)
        Total Special Items                       -               (7,631)

    Adjusted EBIT                           $26,394             $126,206

    Adjusted EBITDA                         $30,311             $140,845

    Note:  EBIT, EBITDA, adjusted EBIT, and adjusted EBITDA are non-GAAP
    measures.  We use these measures to evaluate our businesses, and we
    allocate resources to our businesses  based on EBIT. EBIT, EBITDA,
    adjusted EBIT, and adjusted EBITDA are not measures of performance
    calculated in accordance with accounting principles generally accepted in
    the United States and should not be considered as an alternative to net
    income as a measure of operating results.  None of these are measures of
    cash available for use by management.

SOURCE Robbins & Myers, Inc.
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