spx corporation 3rd quarter 2008 results
TRANSCRIPT
2008 Third Quarter Results
October 29, 2008
PAGE 2
Forward-Looking Statements
Certain statements contained in this presentation that are not historical facts, including any statements as to future market conditions, results of operations and financial projections, are forward-looking statements and are thus prospective. These forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements.
Particular risks facing SPX include economic, business and other risks stemming from our international operations, legal and regulatory risks, cost of raw materials, pricing pressures, pension funding requirements, integration of acquisitions and changes in the economy. More information regarding such risks can be found in SPX’s SEC filings.
Although SPX believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. In addition, estimates of future operating results are based on the company’s current complement of businesses, which is subject to change.
Statements in this presentation are only as of the time made and SPX does not intend to update any statements made in this presentation except as required by regulatory authorities.
This presentation includes non-GAAP financial measures. A copy of this presentation, including a reconciliation of the non-GAAP financial measures with the most comparable measures calculated and presented in accordance with GAAP, is available on our website at www.spx.com.
PAGE 3
Introduction
PAGE 4
Changing Economic Environment
Recent Foreign Exchange Fluctuations Have Impacted SPX’s 2008 Outlook;Too Early to Predict How Economic Changes Will Impact SPX Customers in 2009
Banking failures and consolidations have impacted credit availability for many companies
Global credit crisis has created an uncertain economic environment…
…as a result, capital budgets for 2009 are uncertain
Foreign exchange rates have changed dramatically, impacting SPX’s 2008 outlook and backlog:
– % decline from June through October:
• Euro: (18%)
• British Pound: (18%)
• Zar: (28%)
-40%
-30%
-20%
-10%
0%
10%
Jun-08 Jul-08 Aug-08 Sep-08 Oct-08
EUR GBP ZAR
% Value Declinevs. U.S. Dollar
PAGE 5
Q3 Financial Highlights
Q3 2007($ millions, except per share data)
GAAP Earnings Per Share
Adjusted Earnings Per Share (1)
Revenue
Segment Income Margin
Free Cash Flow
$1.74 $2.01 +16%
$1.39 $1.66 +19%
$1,172 $1,510 6.5% organic growth
14.2% 13.8% 120 points of margin expansion excluding APV
$30 $71 Improved operating income and working capital
6.5% Organic Revenue Growth;19% Adjusted Earnings Growth
Q3 2008 2008 Comments
(1) Q3 2007 EPS excludes $0.35 of tax benefits, Q3 2008 excludes $0.47 of tax benefits and a $0.11 legal charge
Note: Data from continuing operations; See appendix for non-GAAP reconciliations
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YTD Financial Highlights
($ millions, except per share data)
GAAP Earnings Per Share
Adjusted Earnings Per Share (1)
Revenue
Segment Income Margin
6% Organic Revenue Growth;45% Adjusted Earnings Growth
$3.43 $4.86 +42%
$3.10 $4.49 +45%
$3,361 $4,426 6% organic growth
12.4% 13.1% 240 points of margin expansion excluding APV
YTD 2007 YTD 2008 2008 Comments
(1) YTD 2007 EPS excludes $0.33 of tax benefits, YTD 2008 excludes $0.47 of tax benefits and a $0.11 legal charge
Note: Data from continuing operations; See appendix for non-GAAP reconciliations
PAGE 7
SPX Global End Markets
General Industrial
13%
Global Infrastructure
53%
Sanitary14%
Tools & Diagnostics
20%
Targeting Q4 Organic Growth Between 8% and 10%;Tools & Diagnostics Declining
Pro Forma Revenueby End Market
Note: 2007 data from continuing operations, pro forma for APV acquisition
Power & Energy
33%
HVAC, Telecom,
Other20%
Q4 2008E OrganicGrowth Expectations
Power & Energy
Sanitary
General Industrial
HVAC, Telecom, Other
Tools & Diagnostics
Mid-Single DigitGrowth
Single Digit DeclineFlatDouble Digit
GrowthROW4%
North America49%
Asia-Pacific15%
Europe32%
Pro Forma Revenueby Geography
(Food, Beverage, Dairy, Pharmaand Personal Care Markets)
PAGE 8
Backlog Development
Backlog Decline Primarily Driven by Foreign Exchange Rate Changes;Total Backlog Down ~$120m or 3% During Q3
($ millions)
$1,401 $799 $696
$2,003 $782 $721
$2,077 $796 $648
$2,002 $763 $648
$0 $1,000 $2,000 $3,000
Q1 '08
Q2 '08
Q3 '08*
Q3 '08
Thermal Flow Industrial
Q3 ending backlog at $3.6b, down $120m or 3% from Q2:
– Foreign currency fluctuations reduced the backlog value by $108m
– Industrial backlog down 10%:• 28% organic growth in Q3• Distribution transformer orders
slowing
~60% of annual revenue from short-cycle businesses
No major contract cancellations
Last 3 Quarters Ending Backlog
*Q3 2008 backlog excluding the impact of foreign currency fluctuations
PAGE 9
Recent Strategic Actions
Continue to Execute Long-Term Strategy; Consistent Approach to Capital Allocation
Discontinued 2 non-core product lines:– Flow product line: ~$50m in annual sales– Test and Measurement product line: ~$20m in annual sales
Signed definitive agreement to sell LDS, our vibration testing and data acquisition equipment business, for ~$102m:
– Expect to complete the sale by the end of 2008
Acquired Autoboss:– Chinese-based manufacturer of diagnostic tools and equipment
– ~$10m in annual sales
APV integration progressing:– Targeting headcount reduction of ~500 people
Announced 10b5-1 share repurchase plan:– Plan becomes active on November 3, 2008 and is designed to facilitate the
repurchase of up to 3 million shares
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Financial Position
12/31/07 9/27/08
Cash $354 $466
Other Current Assets 2,362 2,540
Total Assets 6,237 6,523
Total Debt $1,569 $1,531
Other Current Liabilities 1,837 1,842
Shareholders' Equity 2,006 2,361
$466m of Cash on Hand at September 27th;Gross Leverage Ratio Within Target Range of 1.5x to 2.0x EBITDA
($ millions)Key Balance Sheet
Accounts at,
2.3x
1.9x
1.8x1.4x
Q4 2007 Q3 2008
Net Leverage Gross Leverage
Debt to Capital
Debt to EBITDA (1)
44.0%
39.0%
Q4 2007 Q3 2008
(1) Consolidated leverage ratios; Net and Gross Debt to EBITDA as defined in the credit facility
PAGE 11
Q3 2008 Consolidated Results
PAGE 12
Q3 Earnings Per Share
$1.74
$2.01
$1.39
$1.66
Q3 2007 Q3 2008
Adjusted EPS GAAP EPS
19% Adjusted Earnings Growth Driven Primarily by Increased Segment Income
Q3 Earnings Per ShareFrom Continuing Operations
Q3 2007 Adjusted EPS (1) $1.39
Segment Income +$0.53
Tax Rate ($0.09)
Interest Expense ($0.06)
Pension Expense ($0.05)
Other Items ($0.05)
Q3 2008 Adjusted EPS (1) $1.66
19%19%
Year-Over-Year Changes inAdjusted Earnings Per Share
(1)
(1) Q3 2007 EPS excludes $0.35 of tax benefits, Q3 2008 excludes $0.47 of tax benefits and a $0.11 legal charge
Note: Data from continuing operations; See appendix for non-GAAP reconciliations
16%16%
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Q3 Financial Results
$1,172
$1,510
Q3 2007 Q3 2008
$167
$209
Q3 2007 Q3 2008
6.5% Organic Growth; 120 Points of Segment Margin Expansion Excluding APV Dilution
Revenue($ millions)
29%29%
20% acquisition growth
6.5% organic growth
3% benefit from foreign currency
25% increase in segment income
120 points of margin expansion excluding the dilutive impact of the APV acquisition
Segment Income& Margin
Note: Data from continuing operations; see appendix for non-GAAP reconciliations
14.2% 13.8%
25%25%
15.4%APV Dilution:
160 pts
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Segment Analysis
PAGE 15
Flow Technology: Q3 Financial Results & Q4 Targets
$256
$493
Q3 2007 Q3 2008
8% Organic Growth in Q3;APV Q3 Margin Dilution: 550 Points
Q3 Revenue and Segment Income Margins
($ millions)
92%92%
11.3%
17.2%
Note: Data from continuing operations; see appendix for non-GAAP reconciliations
83% acquisition growth from APV:APV margin dilution: 550 points
8% organic growth:
Strong power, oil and gas and dehydration sales
Shipping delays caused by Hurricane
APV acquisition expected to drive top-line growth:
Cost reduction actions expected to benefit margins
Expect mid-single digit organic growth
Negative foreign currency impact
Q4E Revenue and Segment Income Margins
$311
+58% to 61%
Q4 2007 Q4 2008E
14.2% to 14.5%
16.4%
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$422 $437
Q3 2007 Q3 2008
13.4%12.0%
Thermal Equipment and Services: Q3 Financial Results & Q4 Targets
2 Percent Organic Revenue Decline in Q3;Targeting Double Digit Organic Revenue Growth in Q4
($ millions)
4%4%
2% organic decline:Uneven nature of infrastructure projects
Lower China sales
28% organic growth in Q3 2007
5% foreign exchange benefit
Lower mix of higher margin dry cooling sales
Targeting double-digit organic growth
Negative foreign currency impact
Expect 60 to 110 points of margin expansion
Note: Data from continuing operations; see appendix for non-GAAP reconciliations
Q3 Revenue and Segment Income Margins
Q4E Revenue and Segment Income Margins
$438
+18% to 22%
Q4 2007 Q4 2008E
12.0%
12.6% to13.1%
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Test and Measurement: Q3 Financial Results & Q4 Targets
$245$260
Q3 2007 Q3 2008
US Tools and Diagnostics Market Remains Challenging;Expect Double-Digit Revenue Decline in Q4
($ millions)
6%6%
9.0%
11.7%
7% acquisition growth: JCD & Matra
3% organic decline:– Weak U.S. market volume
270 points of margin expansion:
– $7m write-off in Q3 2007
Challenging US tools and diagnostics market
Reduced volume of OE programs in Q4 2008 vs. Q4 2007
Negative foreign currency impact
Note: Data from continuing operations; see appendix for non-GAAP reconciliations
Q3 Revenue and Segment Income Margins
Q4E Revenue and Segment Income Margins
$315
(13%) to (17%)
Q4 2007 Q4 2008E
13.0%
10.2% to 10.5%
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Industrial Products and Services: Q3 Financial Results & Q4 Targets
$249
$320
Q3 2007 Q3 2008
28% Organic Revenue Growth and22% Segment Income Margins in Q3
($ millions)
29%29%
22.0%
17.7%
28% organic growth:
Strong sales for transformers and crystal growers
60% increase in segment income
430 points of margin expansion
Note: Data from continuing operations; see appendix for non-GAAP reconciliations
Q3 Revenue and Segment Income Margins
Q4E Revenue and Segment Income Margins
$253
+13% to 17%
Q4 2007 Q4 2008E
19.5% to 19.7%
20.5%
Targeting double-digit organic growth in Q4
PAGE 19
2008 Q4 Targets
14% to 20% Earnings Growth Expected in Q4
($ millions, except per share data)Q4 2008E
Revenue $1,316 +18% to 22% +8% to 10%
Segment Income $ $196 $220 to $230
Segment Income % 14.9% 14.1% to 14.3% 14.8% to 15.0%
EPS $1.67 (1) $1.90 - $2.00 (1) Adjusted EPS, see appendix for reconciliation
Note: Data from continuing operations
Q4 2007
+12% to 17%+12% to 17%
(60) to (80) bps(60) to (80) bps
+14% to 20%+14% to 20%
Excluding APV
Organic Growth
PAGE 20
2008 Full Year Segment Targets
IndustrialIndustrial
FlowFlow
ThermalThermal
Test & Measurement
Test & Measurement
July 30th
FY Targets
Revenue Growth
Operating Margins
Revenue Growth
Operating Margins
Revenue Growth
Operating Margins
Revenue Growth
Operating Margins
October 29th
FY Targets
Note: All data from continuing operations
+88% to 89%
12.0% to 12.2%
+91% to 93%
11.8% to 12.3%
+10% to 11%
11.7% to 11.9%
+11% to 13%
10.6% to 11.1%
Primary Drivers for Change
+3% to 4%
10.5% to 10.7%
+9% to 11%
10.5% to 11.0%
+19% to 20%
20.6% to 20.8%
+18% to 20%
20.2% to 20.7%
FX fluctuations
Discontinued product line
FX fluctuations
Strong Q3 margin execution
FX fluctuations,
Softness in U.S. market
Discontinued product line
Strong Q3 operating execution
Targets Have Been Adjusted to Reflect Foreign Currency Fluctuations, Discontinued Operations and Q3 Performance
PAGE 21
2008 Financial Targets and Updated Guidance
Targeting 7% to 8% Organic Growth and More Than 30% Earnings Growth in 2008
2008 Target Range
Revenue
Segment Income Margin
Excluding APV
Adjusted Earnings Per Share
Free Cash Flow
Capital Spending
Note: Data from continuing operations; see appendix for non-GAAP reconciliations
Comments+28% to 29% Organic: 7% to 8%
13.2% to 13.4% +10 to 30 bps
14.6% to 14.8% +150 to 170 bps
$6.40 to $6.50 32% to 34%
$300 to $320 85% to 90% of NI
$140 to $150 Capacity, Lean & IT Investments
($ millions, except per share data)
PAGE 22
2008 Guidance
Updated 2008 EPS Guidance Range of $6.40 to $6.50;Free Cash Flow Guidance Range Unchanged at $300 to $320
2008 EPS Guidance
Previous:
$6.40 to $6.60
Current:$6.40 to $6.50
Note: Data from continuing operations; see appendix for non-GAAP reconciliations
Potential Upsides/Downsides
Additional foreign currency fluctuations
Short-cycle end market developments
Project timing
APV integration
Effective tax rate change
PAGE 23
Free Cash Flow, Debt Structure and Liquidity
PAGE 24
Free Cash Flow
$313
$300 to$320
2007 2008E
Strong Q4 Expectations Consistent with Last Year
1st Nine MonthsFree Cash Flow
($ millions)
Note: See appendix for non-GAAP reconciliations
Full YearFree Cash Flow
(1)
(1) Includes $30m to $50m of cash restructuring for the APV acquisition and elevated capital spending of $140m to $150m
$88
$68
YTD Sept. 2007 YTD Sept. 2008
PAGE 25
Debt Structure
Minimal Debt Repayment Requirements for the Next 2 Years
($ millions)
$19$75 $75
$190
$486
$28
$500
Q42008
2009 2010 2011 2012 2013 2014
Outstanding Debt (1)
(1) As of 9/27/2008
Term loan $712
Domestic revolver $130
Global revolver $0
7.625% Senior Notes $500
7.50% Senior Notes $28
6.25% Senior Notes $21
A/R Securitization (2) $70
Other indebtedness $69
Total debt $1,531
Debt Maturity Schedule
Part of GlobalCredit Facility
(2) One year term
PAGE 26
Projected Liquidity
Over $800m of Projected Liquidity After Completing Planned Share Repurchases
Cash on hand at 9/27/2008 $466
Expected cash proceeds from the sale of LDS 102
2008E free cash flow remaining 242Available, committed credit lines 400
Total Projected Availability $1,210
Remaining dividend payments ($15)
2008 minimum remaining debt payments (19)
Working capital management needs (200)
Projected Liquidity $976
Repurchase 3m shares (based on 10/28 closing stock price of $43.88) ($132)
Projected Liquidity after Share Repurchases $844
Note: Our ability to access these sources under our various facilities may be limited by the terms of our credit facility and by certain tax regulations that pertain to cash in overseas locations
($ millions)
Expected Sources
RequiredUses
PlannedUse
Amount
PAGE 27
Summary
PAGE 28
Current SPX Situation
Exceeded Q3 2008 earnings per share guidance
Targeting growth in Q4 2008:– Targeting 8% to 10% organic growth
– Targeting 14% to 20% earnings growth
Solid financial position and liquidity:– Expect to repurchase 3m shares of SPX stock
– Significant flexibility in uncertain economic environment
Reducing cost through APV integration
Evaluating and preparing for 2009
Carefully Monitoring Risks In Uncertain Economic Environment
PAGE 29
Questions
PAGE 30
Appendix
PAGE 31
Balance Sheet
($ millions) 12/31/07 9/27/08 Change
Cash $354 $466 $112
Other Current Assets 2,362 2,540 178
Goodwill 1,930 1,921 (9)
Other Assets 1,591 1,595 4
Total Assets $6,237 $6,523 $286
Other Current Liabilities $1,838 $1,842 $4
Total Debt 1,568 1,531 (37)
Long-Term Liabilities 825 790 (35)
Shareholders' Equity 2,006 2,361 355Total Liabilities and Shareholders' Equity
$6,237 $6,523 $286
Debt / Capital Ratio 44% 39%LTM EBITDA (1) $663 $772Net Debt / EBITDA (1) 1.83x 1.35xGross Debt / EBITDA (1) 2.29x 1.89x
(1) As defined in the SPX credit facility
PAGE 32
Full Year Financial Model($ millions, except per share data)
(1) Adjusted EPS, includes businesses discontinued in 2008, see appendix for reconciliationNote: Data from continuing operations
2008E Mid-Point EPS Guidance is $6.45 Per Share
(1)
2007
2008E Guidance Mid-Point
Revenue $4,677 $6,000Segment Income Margin 13.1% 13.3%
Corporate overhead (95) (107) Pension / PRHC (44) (37) Stock-based compensation (41) (43) Special charges (5) (16) Operating Income $428 $598 % of revenues 9.1% 10.0%
Equity Earnings in J/V 40 46 Other Income/(Expense) (5) (7) Interest Expense (71) (107) Pre-Tax Income from Continuing Operations $392 $530Tax Provision (126) (178) Income from Continuing Operations $266 $352
Tax Rate 32% 34%Weighted Average Dilutive Shares Outstanding 56 55
EPS from continuing operations 4.73$ 6.45$ EPS from businesses discontinued in 2008 0.12$ Adjusted EPS 4.85$
Adjusted EPS Guidance Range $6.40 to $6.50
EBITDA 663$ 800$
PAGE 33
Pro Forma APV Calculation: Q3 2008
Excluding APV APV
Including APV
SPX Consolidated Q3 2008Revenue $1,298 $212 $1,510Segment Income $200 $9 $209Segment Margin 15.4% 4.2% 13.8%
Flow Technology Q3 2008Revenue $282 $212 $493Segment Income $47 $9 $56Segment Margin 16.7% 4.2% 11.3%
Note: Data from continuing operations
PAGE 34
Re-Stated Quarterly Segment Data
Note: Data from continuing operations
Fourth Quarter Full Year2007 2008 2007 2008 2007 2008 2007 2007
Flow Technology Revenue $237 $492 $266 $535 $256 $493 $311 $1,070 Segment Income $37 $47 $44 $70 $44 $56 $51 $175 Segment Margins 15.4% 9.5% 16.5% 13.1% 17.2% 11.3% 16.4% 16.4%
Test and Measurement Revenue $236 $270 $284 $320 $245 $260 $315 $1,080 Segment Income $24 $24 $32 $37 $22 $30 $41 $118 Segment Margins 10.0% 8.9% 11.2% 11.4% 9.0% 11.7% 13.0% 11.0%
Thermal Equipment and Services Revenue $313 $347 $388 $409 $422 $437 $438 $1,561 Segment Income $16 $36 $38 $46 $57 $52 $52 $163 Segment Margins 5.2% 10.5% 9.8% 11.1% 13.4% 12.0% 12.0% 10.4%
Industrial Products and Services Revenue $212 $267 $253 $276 $249 $320 $253 $966 Segment Income $26 $54 $34 $57 $44 $70 $52 $156 Segment Margins 12.3% 20.3% 13.5% 20.5% 17.7% 22.0% 20.5% 16.2%
First Quarter Second Quarter Third Quarter
PAGE 35
Non-GAAP Reconciliations
PAGE 36
Adjusted Q3 Earnings Per Share
Q3 2007
Q3 2008
GAAP EPS from continuing operations $1.74 $2.01
Q3 Tax Benefits (0.35) ($0.47)
Q3 Legal Settlement (Other Expense) $0.11
Adjusted EPS from continuing operations $1.39 $1.66
Note: Data from continuing operations
Adjusted EPS Presented Consistent with 2008 EPS Guidance
PAGE 37
Adjusted YTD Earnings Per Share
Sept. 2007
Sept. 2008
GAAP EPS from continuing operations $3.43 $4.86
Q3 Tax Benefits (0.33) (0.47)
Q3 Legal Settlement (Other Expense) 0.11
Adjusted EPS from continuing operations $3.10 $4.49
Nine Months Ended,
Note: Data from continuing operations
Adjusted EPS Presented Consistent with 2008 EPS Guidance
PAGE 38
Adjusted Full Year Earnings Per Share
Note: Data from continuing operations
2007 2008E
GAAP EPS from continuing operations $5.33 $6.81
Q3 Tax Benefits (0.34) (0.47)
Q3 Legal Settlement (Other Expense) 0.11
Q4 Tax Benefits (0.25)
Q4 Asset Impairment 0.05
Q4 Legacy Legal Matters (Corporate Expense) 0.06
Adjusted EPS from continuing operations $4.85 $6.45
PAGE 39
Q3 2008 Organic Revenue Growth Reconciliation
Net Revenue Acquisitions/ Organic Growth Divestitures Growth
Flow 92.4% 83.1% 1.0% 8.3%
Test 6.1% 7.4% 1.8% -3.1%
Thermal 3.5% 0.0% 5.3% -1.8%
Industrial 28.6% 0.0% 0.4% 28.2%
Consolidated 28.8% 19.7% 2.6% 6.5%
Foreign Currency
Quarter Ended September 27, 2008
Note: Data from continuing operations
PAGE 40
YTD 2008 Organic Revenue Growth Reconciliation
Net Revenue Acquisitions/ Organic Growth Divestitures Growth
Flow 100.1% 86.9% 3.3% 9.9%
Test 11.1% 10.4% 3.7% -3.0%
Thermal 6.2% 0.0% 6.1% 0.1%
Industrial 21.0% 0.0% 1.1% 19.9%
Consolidated 31.7% 22.0% 3.9% 5.8%
Foreign Currency
YTD September 27, 2008
Note: Data from continuing operations
PAGE 41
Q3 Free Cash Flow Reconciliation to GAAP Financial Measures
($ millions) Q3 2007 Q3 2008
Net cash from continuing operations 48$ 104$ Capital expenditures (19)$ (33)$
Free cash flow from continuing operations 30$ 71$
Free Cash Flow Reconciliation(unaudited)
SPX Corporation and Subsidiaries
PAGE 42
Nine Months Free Cash Flow Reconciliation to GAAP Financial Measures
($ millions) Nine Months Ended September
2007
Nine Months Ended September
2008
Net cash from continuing operations $135 $147Capital expenditures ($47) ($79)
Free cash flow from continuing operations $88 $68
Free Cash Flow Reconciliation(unaudited)
SPX Corporation and Subsidiaries
PAGE 43
Full Year Free Cash Flow Reconciliation to GAAP Financial Measures
($ millions)2006 2007
Net cash from continuing operations 49$ 404$ Capital expenditures (56)$ (91)$
Free cash flow from continuing operations (7)$ 313$ Interst paid on LYONS repurchase 84$ Taxes paid on LYONs tax recapture 91$
Adjusted free cash flow from continuing operations 168$
FCF from operations discontinued in 2007 15$
Adjusted free cash flow as reported 2/28/2007 183$
Free Cash Flow Reconciliation(unaudited)
SPX Corporation and Subsidiaries
PAGE 44
2008E Free Cash Flow Reconciliation to GAAP Financial Measures
($ millions)
Net cash from continuing operations 440$ 470$ Capital expenditures (140)$ (150)$
Free cash flow from continuing operations 300$ 320$
2008E Guidance Range
Free Cash Flow Reconciliation(unaudited)
SPX Corporation and Subsidiaries
PAGE 45
EBITDA Reconciliations
Note: EBITDA as defined in the credit facility
($ millions) 2006 2007
LTM Sept. 2008
Revenues $4,313 $4,822 $5,742
Net Income $171 $294 $381Income tax provision (benefit) 56 90 127Interest expense 50 77 110Income before interest and taxes $277 $461 $618
Depreciation and intangible amortization expense 90 83 102EBITDA from continuing operations $367 $544 $720
Adjustments:Non-cash compensation expense 38 41 43Extraordinary non-cash charges 41 14 (9)Extraordinary non-recurring cash charges 27 7 11Excess of JV distributions over JV income (12) 2 3Loss (Gain) on disposition of assets 56 4 (14)Pro Forma effect of acquisitions and divestitures 53 20Other 8 0
Adjusted LTM EBITDA from continuing operations $525 $663 $772
PAGE 46
Debt Reconciliations
($ millions) 12/31/2007 9/27/2008
Short-term debt 254$ 260$ Current maturities of long-term debt 79 76 Long-term debt 1,235 1,194
Gross Debt 1,568$ 1,531$
Less: Puchase card program and extended A/P programs (58)$ (59)$
Adjusted Gross Debt 1,510$ 1,472$
Less: Cash in excess of $50m (304)$ (416)$
Adjusted Net Debt 1,206$ 1,055$
Note: Debt as defined in the credit facility
PAGE 47