Franklin Electric, Co., Inc. First Quarter 2006 10-Q
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
_________
FORM
10-Q
_________
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the quarterly period ended April
1, 2006
OR
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from _____ to _____
Commission
file number 0-362
FRANKLIN
ELECTRIC CO., INC.
(Exact
name of registrant as specified in its charter)
Indiana
|
|
35-0827455
|
(State
or other jurisdiction of incorporation or
organization)
|
|
(I.R.S.
Employer Identification No.)
|
|
|
|
400
East Spring Street
|
|
|
Bluffton,
Indiana
|
|
46714
|
(Address
of principal executive offices)
|
|
(Zip
Code)
|
(260)
824-2900
(Registrant's
telephone number, including area code)
Not
Applicable
(Former
name, former address and former fiscal year, if changed since last
report)
Indicate
by check mark whether the registrant (1) has filed all reports required to
be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the
preceding 12 months, and (2) has been subject to such filing requirements for
the past 90 days.
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of “accelerated
filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
one):
Large
Accelerated Filer x
|
Accelerated
Filer o
|
Non-Accelerated
Filer o
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).
Indicate
the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date.
|
|
Outstanding
at
|
Class
of Common Stock
|
|
April
1, 2006
|
$.10
par value
|
|
22,646,412
shares
|
FRANKLIN
ELECTRIC CO., INC.
Index
|
|
|
Page
|
PART
I.
|
FINANCIAL
INFORMATION
|
|
Number
|
|
|
|
|
Item
1.
|
Financial
Statements (Unaudited)
|
|
|
|
|
|
|
|
Condensed
Consolidated Balance Sheets as of April 1, 2006 and December 31,
2005
|
|
3
|
|
|
|
|
|
Condensed
Consolidated Statements of Income for the First Quarter Ended April
1,
2006 and April 2, 2005
|
|
4
|
|
|
|
|
|
Condensed
Consolidated Statements Of Cash Flows for the First Quarter Ended
April 1,
2006 and April 2, 2005
|
|
5
|
|
|
|
|
|
Notes
to Condensed Consolidated Financial Statements
|
|
6-12
|
|
|
|
|
Item
2.
|
Management's
Discussion and Analysis of Financial Condition and Results of
Operations
|
|
13-14
|
|
|
|
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
|
14
|
|
|
|
|
Item
4.
|
Controls
and Procedures
|
|
14
|
|
|
|
|
PART
II.
|
OTHER
INFORMATION
|
|
|
|
|
|
|
Item
1A.
|
Risk
Factors
|
|
15
|
|
|
|
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
|
16
|
|
|
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
|
16
|
|
|
|
|
Item
5.
|
Other
Information
|
|
17
|
|
|
|
|
Item
6.
|
Exhibits
|
|
17
|
|
|
|
|
Signatures
|
|
|
18
|
|
|
|
|
Exhibit
Index
|
|
|
19
|
|
|
|
|
Exhibits
|
|
|
20-35
|
PART
I.
FINANCIAL INFORMATION
Item
1. Financial Statements
FRANKLIN
ELECTRIC CO., INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In
thousands, except per share amounts)
|
|
April
1,
|
|
December
31,
|
|
|
|
2006
|
|
2005
|
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash
and equivalents
|
|
$
|
69,378
|
|
$
|
52,136
|
|
Investments
|
|
|
-
|
|
|
35,988
|
|
Receivables,
less allowances of $2,220 and $2,204, respectively
|
|
|
42,446
|
|
|
30,165
|
|
Inventories
|
|
|
80,929
|
|
|
70,381
|
|
Other
current assets (including deferred income taxes of $10,887 and $10,744,
respectively)
|
|
|
14,900
|
|
|
14,350
|
|
Total
current assets
|
|
|
207,653
|
|
|
203,020
|
|
Property,
plant and equipment, net
|
|
|
95,861
|
|
|
95,732
|
|
Deferred
and other assets (including deferred income taxes of $335 and $0,
respectively)
|
|
|
22,497
|
|
|
23,028
|
|
Goodwill
|
|
|
58,393
|
|
|
57,982
|
|
Total
assets
|
|
$
|
384,404
|
|
$
|
379,762
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND SHAREOWNERS' EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Current
maturities of long-term debt and short-term borrowings
|
|
$
|
1,309
|
|
$
|
1,303
|
|
Accounts
payable
|
|
|
20,508
|
|
|
26,409
|
|
Accrued
expenses
|
|
|
28,601
|
|
|
34,223
|
|
Income
taxes
|
|
|
3,433
|
|
|
2,087
|
|
Total
current liabilities
|
|
|
53,851
|
|
|
64,022
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
12,350
|
|
|
12,324
|
|
Deferred
income taxes
|
|
|
4,369
|
|
|
4,296
|
|
Employee
benefit plan obligations
|
|
|
25,899
|
|
|
25,830
|
|
Other
long-term liabilities
|
|
|
5,630
|
|
|
5,728
|
|
|
|
|
|
|
|
|
|
Shareowners'
equity:
|
|
|
|
|
|
|
|
Common
shares (45,000 shares authorized, $.10 par value)
|
|
|
|
|
|
|
|
outstanding
(22,646
and 22,485, respectively)
|
|
|
2,265
|
|
|
2,249
|
|
Additional
capital
|
|
|
80,030
|
|
|
74,717
|
|
Retained
earnings
|
|
|
197,625
|
|
|
190,381
|
|
Loan
to ESOP Trust
|
|
|
(200
|
)
|
|
(432
|
)
|
Accumulated
other comprehensive income
|
|
|
2,585
|
|
|
647
|
|
Total
shareowners' equity
|
|
|
282,305
|
|
|
267,562
|
|
|
|
|
|
|
|
|
|
Total
liabilities and shareowners' equity
|
|
$
|
384,404
|
|
$
|
379,762
|
|
See
Notes
to Condensed Consolidated Financial Statements.
FRANKLIN
ELECTRIC CO., INC.
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In
thousands, except per share amounts)
|
|
First
Quarter Ended
|
|
|
|
April
1,
|
|
April
2,
|
|
|
|
2006
|
|
2005
|
|
|
|
|
|
|
|
Net
sales
|
|
$
|
110,980
|
|
$
|
82,434
|
|
|
|
|
|
|
|
|
|
Cost
of sales
|
|
|
74,388
|
|
|
56,955
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
|
36,592
|
|
|
25,479
|
|
|
|
|
|
|
|
|
|
Selling
and administrative expenses
|
|
|
21,615
|
|
|
16,272
|
|
|
|
|
|
|
|
|
|
Restructuring
expense
|
|
|
-
|
|
|
205
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
|
14,977
|
|
|
9,002
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
(193
|
)
|
|
(172
|
)
|
Other
income, net
|
|
|
445
|
|
|
151
|
|
Foreign
exchange gain/(loss)
|
|
|
(45
|
)
|
|
11
|
|
|
|
|
|
|
|
|
|
Income
before income taxes
|
|
|
15,184
|
|
|
8,992
|
|
|
|
|
|
|
|
|
|
Income
taxes
|
|
|
5,485
|
|
|
3,181
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
9,699
|
|
$
|
5,811
|
|
|
|
|
|
|
|
|
|
Per
share data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings per share
|
|
$
|
.43
|
|
$
|
.26
|
|
|
|
|
|
|
|
|
|
Diluted
earnings per share
|
|
$
|
.42
|
|
$
|
.25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
per share
|
|
$
|
.10
|
|
$
|
.08
|
|
See
Notes
to Condensed Consolidated Financial Statements.
FRANKLIN
ELECTRIC CO., INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In
thousands)
|
|
First
Quarter Ended
|
|
|
|
April
1,
|
|
April
2,
|
|
|
|
2006
|
|
2005
|
|
Cash
flows from operating activities:
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
9,699
|
|
$
|
5,811
|
|
Adjustments
to reconcile net income to net cash flows from operating
activities:
|
|
|
|
|
|
|
|
Depreciation
and amortization
|
|
|
4,075
|
|
|
3,944
|
|
Stock
based compensation
|
|
|
894
|
|
|
-
|
|
Deferred
income taxes
|
|
|
261
|
|
|
849
|
|
Loss/(gain)
on disposals of plant and equipment
|
|
|
(5
|
)
|
|
28
|
|
Changes
in assets and liabilities:
|
|
|
|
|
|
|
|
Receivables
|
|
|
(12,053
|
)
|
|
3,337
|
|
Inventories
|
|
|
(9,911
|
)
|
|
(18,297
|
)
|
Accounts
payable and other accrued expenses
|
|
|
(9,330
|
)
|
|
(2,657
|
)
|
Excess
tax from share-based payment arrangements
|
|
|
(1,176
|
)
|
|
-
|
|
Employee
benefit plan obligations
|
|
|
(23
|
)
|
|
(324
|
)
|
Other,
net
|
|
|
(668
|
)
|
|
(827
|
)
|
Net
cash flows from operating activities
|
|
|
(18,237
|
)
|
|
(8,136
|
)
|
|
|
|
|
|
|
|
|
Cash
flows from investing activities:
|
|
|
|
|
|
|
|
Additions
to plant and equipment
|
|
|
(2,912
|
)
|
|
(2,145
|
)
|
Proceeds
from sale of plant and equipment
|
|
|
45
|
|
|
1,023
|
|
Additions
to deferred and other assets
|
|
|
(52
|
)
|
|
(3
|
)
|
Purchase
of securities
|
|
|
(63,500
|
)
|
|
(60,000
|
)
|
Proceeds
from sale of securities
|
|
|
99,488
|
|
|
41,989
|
|
Net
cash flows from investing activities
|
|
|
(33,069
|
)
|
|
(19,136
|
)
|
|
|
|
|
|
|
|
|
Cash
flows from financing activities:
|
|
|
|
|
|
|
|
Repayment
of long-term debt
|
|
|
(70
|
)
|
|
(72
|
)
|
Proceeds
from issuance of common stock
|
|
|
3,036
|
|
|
3,710
|
|
Excess
tax from share-based payment arrangements
|
|
|
1,176
|
|
|
-
|
|
Purchases
of common stock
|
|
|
(198
|
)
|
|
(2,110
|
)
|
Reduction
of loan to ESOP Trust
|
|
|
232
|
|
|
233
|
|
Dividends
paid
|
|
|
(2,258
|
)
|
|
(1,768
|
)
|
Net
cash flows from financing activities
|
|
|
1,918
|
|
|
(7
|
)
|
|
|
|
|
|
|
|
|
Effect
of exchange rate changes on cash
|
|
|
492
|
|
|
(261
|
)
|
Net
change in cash and equivalents
|
|
|
17,242
|
|
|
(27,540
|
)
|
Cash
and equivalents at beginning of period
|
|
|
52,136
|
|
|
50,604
|
|
Cash
and equivalents at end of period
|
|
$
|
69,378
|
|
$
|
23,064
|
|
|
|
|
|
|
|
|
|
Cash
paid
during the first quarter 2006 and 2005 for interest was $0.2 million and $0.2
million, respectively.
Cash
paid
during the first quarter 2006 and 2005 for income taxes was $3.7 million and
$3.6 million, respectively.
See
Notes
to Condensed Consolidated Financial Statements.
FRANKLIN
ELECTRIC CO., INC.
NOTES
TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note
1: Condensed Consolidated Financial Statements
The
accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10
of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all accounting entries
and
adjustments (consisting of normal recurring accruals) considered necessary
for a
fair presentation of the financial position and the results of operation for
the
interim period have been made. Prior year amounts are reclassified when
necessary to conform to current year presentation. Operating results for the
first quarter ended April 1, 2006 are not necessarily indicative of the results
that may be expected for the fiscal year ending December 30, 2006. For further
information, including a description of Franklin Electric's critical accounting
policies, refer to the consolidated financial statements and footnotes thereto
included in Franklin Electric Co., Inc.'s annual report on Form 10-K for the
year ended December 31, 2005.
Note
2: Investments
As
of
April 1, 2006, the Company held no investments in current assets. All income
generated from investments held during the first quarter ended April 1, 2006
was
recorded as other income, net. Cash paid for these securities and proceeds
from
the sale of these securities have been included as part of “Cash flows from
investing activities” section of the cash flow statement.
The
Company also holds a 35 percent equity interest, in Pioneer Pump, Inc. which
is
accounted for using the equity method and is included as part of “Deferred and
other assets” in the balance sheet. The carrying amount of the investment is
adjusted for the Company’s proportionate share of earnings, losses, and
dividends. At April 1, 2006, the carrying value of the investment was $5.5
million.
Note
3:
Inventories
Inventories
consist of the following:
(In
millions)
|
|
April
1,
|
|
December
31,
|
|
|
|
2006
|
|
2005
|
|
Raw
Materials
|
|
$
|
25.9
|
|
$
|
25.3
|
|
Work
in Process
|
|
|
10.7
|
|
|
10.6
|
|
Finished
Goods
|
|
|
61.8
|
|
|
51.8
|
|
LIFO
Reserve
|
|
|
(17.5
|
)
|
|
(17.3
|
)
|
Total
Inventory
|
|
$
|
80.9
|
|
$
|
70.4
|
|
Note
4: Property, Plant and Equipment
Property,
plant and equipment, at cost, consists of the following:
(In
millions)
|
|
April
1,
|
|
December
31,
|
|
|
|
2006
|
|
2005
|
|
Land
and Building
|
|
$
|
53.2
|
|
$
|
52.8
|
|
Machinery
and Equipment
|
|
|
167.3
|
|
|
164.9
|
|
|
|
|
220.5
|
|
|
217.7
|
|
Allowance
for Depreciation
|
|
|
(124.9
|
)
|
|
(122.3
|
)
|
|
|
|
|
|
|
|
|
Other
- Held for Sale
|
|
|
0.3
|
|
|
0.3
|
|
|
|
|
|
|
|
|
|
|
|
$
|
95.9
|
|
$
|
95.7
|
|
Note
5: Goodwill and Other Intangible Assets
The
carrying amount of the Company’s intangible assets, which is included in
“Deferred and other assets” in the balance sheet, and goodwill
include:
|
|
April
1,
|
|
December
31,
|
|
(In
millions)
|
|
2006
|
|
2005
|
|
|
|
|
|
|
|
Amortized
intangibles
|
|
|
|
|
|
|
|
Patents
|
|
$
|
5.9
|
|
$
|
5.9
|
|
Supply
agreements
|
|
|
10.0
|
|
|
10.0
|
|
Other
|
|
|
4.3
|
|
|
4.2
|
|
Accumulated
amortization
|
|
|
(10.6
|
)
|
|
(10.1
|
)
|
Total
|
|
$
|
9.6
|
|
$
|
10.0
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
$
|
58.4
|
|
$
|
58.0
|
|
Changes
in the carrying amount of intangibles and goodwill reflect foreign currency
fluctuations.
Amortization
expense related to intangible assets for the first quarter ended April 1, 2006
and April 2, 2005, was $0.4 million.
During
the first fiscal quarter, there has been no change in the projected amortization
expense for each of the five succeeding years as reported in the Company’s
annual report on Form 10-K for the year ended December 31, 2005.
Note
6: Employee Benefits
The
following table sets forth aggregated net periodic benefit cost:
|
|
|
|
(In
millions)
|
|
Pension
Benefits
|
|
|
|
First
Quarter Ended
|
|
|
|
April
1,
|
|
April
2,
|
|
|
|
2006
|
|
2005
|
|
Service
cost
|
|
$
|
1.1
|
|
$
|
1.1
|
|
Interest
cost
|
|
|
2.2
|
|
|
1.8
|
|
Expected
return on assets
|
|
|
(2.8
|
)
|
|
(2.5
|
)
|
Amortization
of unrecognized:
|
|
|
|
|
|
|
|
(Gain)/Loss
|
|
|
0.1
|
|
|
-
|
|
Prior
service cost
|
|
|
0.4
|
|
|
0.3
|
|
|
|
|
|
|
|
|
|
Net
periodic benefit cost
|
|
|
1.0
|
|
|
0.7
|
|
Settlement
cost
|
|
|
0.0
|
|
|
0.1
|
|
Total
benefit cost
|
|
$
|
1.0
|
|
$
|
0.8
|
|
|
|
Other
Benefits
|
|
|
|
First
Quarter Ended
|
|
(In
millions)
|
|
|
April
1,
|
|
|
April
2,
|
|
|
|
|
2006
|
|
|
2005
|
|
Service
cost
|
|
$
|
0.1
|
|
$
|
0.1
|
|
Interest
cost
|
|
|
0.2
|
|
|
0.2
|
|
Amortization
of unrecognized:
|
|
|
|
|
|
|
|
obligation/(asset)
|
|
|
0.1
|
|
|
0.1
|
|
Prior
service costs
|
|
|
0.1
|
|
|
0.1
|
|
|
|
|
|
|
|
|
|
Net
periodic benefit cost
|
|
|
0.5
|
|
|
0.5
|
|
|
|
|
|
|
|
|
|
Total
benefit cost
|
|
$
|
0.5
|
|
$
|
0.5
|
|
|
|
|
|
|
|
|
|
For
the
first quarter ended April 1, 2006, the Company made contributions to the plans
of $0.5 million and expects to make additional contributions of $2.1 million
in
2006.
Note
7: Tax Rates
The
effective tax rate on income before income taxes in 2006 and 2005 varies from
the United States statutory rate of 35 percent primarily due to the foreign
income exclusion and R & D credits in 2005 and to the effects of state and
foreign income taxes net of federal tax benefits.
Note
8: Shareowners' Equity
The
Company had 22,646,412 shares of common stock (45,000,000 shares authorized,
$.10 par value) outstanding as of April 1, 2006.
During
the three months ended for 2006 and 2005, pursuant to a stock repurchase program
authorized by the Company’s Board of Directors, the Company repurchased 5,000
shares for $0.2 million and 54,400 shares for $2.1 million, respectively. All
repurchased shares were retired.
Note
9: Earnings Per Share
Following
is the computation of basic and diluted earnings per share:
(In
millions, except
|
|
First
Quarter Ended
|
|
per
share amounts)
|
|
April
1,
|
|
April
2,
|
|
|
|
2006
|
|
2005
|
|
Numerator:
|
|
|
|
|
|
|
|
Net
Income
|
|
$
|
9.7
|
|
$
|
5.8
|
|
|
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
|
Weighted
average common shares
|
|
|
22.6
|
|
|
22.1
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
|
|
Effect
of dilutive securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee
and director incentive stock options and awards
|
|
|
0.5
|
|
|
1.1
|
|
|
|
|
|
|
|
|
|
Adjusted
weighted average common shares
|
|
|
23.1
|
|
|
23.2
|
|
|
|
|
|
|
|
|
|
Basic
earnings per share
|
|
$
|
.43
|
|
$
|
.26
|
|
Diluted
earnings per share
|
|
$
|
.42
|
|
$
|
.25
|
|
Note
10: Other Comprehensive Income
Comprehensive
income is as follows:
(In
millions)
|
|
First
Quarter Ended
|
|
|
|
April
1,
|
|
April
2,
|
|
|
|
2006
|
|
2005
|
|
Net
income
|
|
$
|
9.7
|
|
$
|
5.8
|
|
Other
comprehensive income (loss):
|
|
|
|
|
|
|
|
Foreign
currency translation adjustments
|
|
|
2.0
|
|
|
(4.1
|
)
|
Comprehensive
income, net of tax
|
|
$
|
11.7
|
|
$
|
1.7
|
|
Accumulated
other comprehensive income consists of the following:
(In
millions)
|
|
April
1,
|
|
December
31,
|
|
|
|
2006
|
|
2005
|
|
Cumulative
foreign currency translation adjustment
|
|
$
|
8.2
|
|
$
|
6.2
|
|
Minimum
pension liability adjustment, net of tax
|
|
|
(5.6
|
)
|
|
(5.6
|
)
|
Accumulated
other comprehensive income
|
|
$
|
2.6
|
|
$
|
0.6
|
|
Note
11: Warranty
The
Company provides warranties on most of its products. The warranty terms vary
but
are generally two years from date of manufacture or one year from date of
installation. Provisions for estimated expenses related to product warranty
are
made at the time products are sold or when specific warranty issues are
identified. These estimates are established using historical information about
the nature, frequency, and average cost of warranty claims. The Company actively
studies trends of warranty claims and takes action to improve product quality
and minimize warranty claims. The Company believes that its warranty reserve
is
appropriate; however, actual claims incurred could differ from the original
estimates, requiring adjustments to the reserve.
Below
is
a table that shows the activity in the warranty accrual:
(In
millions)
|
|
First
Quarter Ended
|
|
|
|
April
1,
|
|
April
2,
|
|
|
|
2006
|
|
2005
|
|
Beginning
Balance
|
|
$
|
7.0
|
|
$
|
7.1
|
|
Accruals
related to product warranties
|
|
|
1.8
|
|
|
0.7
|
|
Reductions
for payments made
|
|
|
(1.6
|
)
|
|
(1.5
|
)
|
Ending
Balance
|
|
$
|
7.2
|
|
$
|
6.3
|
|
Note
12: Stock-Based Compensation
Prior
to
January 1, 2006, the Company accounted for stock-based employee compensation
plans under the recognition and measurement provisions of APB Opinion No. 25,
“Accounting for Stock Issued to Employees,” and related Interpretations, as
permitted by FASB Statement No. 123, “Accounting for Stock-Based Compensation.”
Effective January 1, 2006, the Company adopted the fair value recognition
provisions of FASB Statement No. 123(R), “Share-Based Payment,” using the
modified-prospective-transition method. Under that transition method,
compensation cost recognized in 2006 includes: (a) compensation cost for all
share-based payments granted prior to, but not yet vested as of January 1,
2006,
based on the grant date fair value estimated in accordance with the original
provisions of Statement 123, and (b) compensation cost for all share-based
payments granted subsequent to January 1, 2006, based on the grant-date fair
value estimated in accordance with the provisions of Statement 123(R). Results
for prior periods have not been restated.
As
a
result of adopting Statement 123(R) on January 1, 2006, the Company’s income
before income taxes and net income for the first quarter ended April 1, 2006,
are $0.9 million and $0.6 million lower, respectively, and basic and diluted
earnings per share for the quarter ended April 1, 2006 would have been $0.45
and
$0.44, respectively, if the Company had continued to account for share-based
compensation under APB Opinion 25.
Prior
to
the adoption of Statement 123(R), the Company presented all tax benefits of
deductions resulting from the exercise of stock options as operating cash flows
in the Statement of Cash Flows. Statement 123(R) requires the cash flows
resulting from the tax benefits resulting from tax deductions in excess of
the
compensation cost recognized for those options (excess tax benefits) to be
classified as financing cash flows. The $1.2 million excess tax benefit
classified as a financing cash inflow would have been classified as an operating
cash inflow if the Company had not adopted Statement 123(R).
The
following table illustrates the effect on net income and earnings per share
if
the company had applied the fair value recognition provisions of Statement
123
to options granted under the Company’s stock option plans in all periods
presented. For purposes of this pro forma disclosure, the value of the options
is estimated using a Black-Scholes option-pricing formula and amortized to
expense over the options’ vesting periods.
(In
millions, except per share amounts)
|
|
First
Quarter Ended
|
|
|
|
April
2,
|
|
|
|
2005
|
|
Reported
net income
|
|
$
|
5.8
|
|
Add:
Stock-based employee compensation expense, net of tax
|
|
|
-
|
|
Deduct:
Total fair value computed stock-based compensation, net of tax*
|
|
|
(0.4
|
)
|
Pro
forma net income
|
|
$
|
5.4
|
|
Earnings
per share:
|
|
|
|
|
Basic
— as reported
|
|
$
|
.26
|
|
Basic
— pro forma
|
|
$
|
.24
|
|
Diluted
— as reported
|
|
$
|
.25
|
|
Diluted
— pro forma
|
|
$
|
.23
|
|
*Includes
expense related to restricted stock reported in net
income.
|
|
|
|
|
The
Company has authorized the grant of options to purchase common stock and
award
shares of common stock of the Company to employees and non-employee directors
of
the Company and its subsidiaries under two stock plans. The plans and the
original number of authorized shares available for grants are as
follows:
|
|
Authorized
Shares
|
|
Franklin
Electric Co., Inc. Stock Option Plan
|
|
|
3,600,000
|
|
Franklin
Electric Co., Inc. Stock Plan - options
|
|
|
1,150,000
|
|
Franklin
Electric Co., Inc. Stock Plan - awards
|
|
|
150,000
|
|
During
2005, all remaining authorized shares available for grant under the Franklin
Electric Co., Inc. Stock Option Plan were awarded. On April 29, 2005, the
Franklin Electric Co., Inc. Stock Plan (the “Stock Plan”) was approved by the
Company’s shareholders. Under the Stock Plan, employees and non-employee
directors may be granted stock options or stock awards. The Company currently
issues new shares from its common stock outstanding balance to satisfy share
option exercises and stock awards.
Stock
Option Grants:
Under
each of the above plans, the exercise price of each option equals the market
price of the Company’s common stock on the date of grant and the options expire
ten years after the date of the grant. Generally, options granted to nonemployee
directors vest 33 percent a year and become fully vested and exercisable after
three years. Options granted to employees vest at 20 or 25 percent a year and
become fully vested and exercisable after five years or four years,
respectively. Subject to the terms of the plans, in general, the aggregate
option price and any applicable tax withholdings may be satisfied in cash or
its
equivalent, or by the plan participant’s delivery of shares of the Company’s
common stock owned more than six months, having a fair market value at the
time
of exercise equal to the aggregate option price and/or the applicable tax
withholdings.
The
fair
value of each option award, both before and after the adoption of FASB 123(R),
is estimated on the date of grant using the Black-Scholes option valuation
model
with a single approach and amortized using a straight-line attribution method
over the option’s vesting period. Options granted to retirement eligible
employees were immediately expensed. In 2005, this amount was disclosed in
the
pro-forma exhibit while in 2006 it is recognized as an expense. The Company
uses
historical data to estimate the expected volatility of its stock; the weighted
average expected life, the period of time options granted are expected to be
outstanding; and its dividend yield. The risk-free rates for periods within
the
contractual life of the option are based on the U.S. Treasury yield curve in
effect at the time of the grant.
The
assumptions used for the Black-Scholes model to determine the fair value of
options granted in the first quarter of 2006 is as follows:
Risk-free
interest rate
|
|
|
4.54
|
%
|
Dividend
yield
|
|
|
.70-.74
|
%
|
Weighted-average
dividend yield
|
|
|
.707
|
%
|
Volatility
factor
|
|
|
.3553-.3768
|
|
Weighted-average
volatility
|
|
|
.359
|
|
Expected
term
|
|
|
4-5
years
|
|
A
summary
of the Company’s stock option plans activity and related information, for the
first quarter ended April 1, 2006 follows:
(shares
in thousands)
Options
|
|
Shares
|
|
Weighted-Average
Exercise
Price
|
|
Weighted-Average
Remaining
Contractual
Term
|
|
Aggregate
Intrinsic
Value
(000’s)
|
|
Outstanding
at beginning of period
|
|
|
1,793
|
|
$
|
23.600
|
|
|
|
|
|
|
|
Granted
|
|
|
125
|
|
|
45.900
|
|
|
|
|
|
|
|
Exercised
|
|
|
(144
|
)
|
|
21.144
|
|
|
|
|
|
|
|
Forfeited
|
|
|
(11
|
)
|
|
25.215
|
|
|
|
|
|
|
|
Outstanding
at end of period
|
|
|
1,763
|
|
$
|
25.376
|
|
|
6.33
|
|
$
|
51,616
|
|
Vested
or expected to vest
at
end of period
|
|
|
1,655
|
|
$
|
24.766
|
|
|
.51
|
|
$
|
49,467
|
|
Exercisable
at April 1, 2006
|
|
|
1,066
|
|
$
|
21.244
|
|
|
5.39
|
|
$
|
35,597
|
|
The
weighted-average grant-date fair value of options granted during the first
quarter of 2006 was $16.43. The total intrinsic value of options exercised
during the first quarter of 2006 was $0.8 million.
A
summary
of the Company’s nonvested shares activity and related information, for the
first quarter ended April 1, 2006 follows:
(shares
in thousands)
Nonvested
Shares
|
|
Shares
|
|
Weighted-
Average
Grant-Date
Fair
Value
|
|
Nonvested
at beginning of period
|
|
|
736
|
|
$
|
7.033
|
|
Granted
|
|
|
126
|
|
|
16.429
|
|
Vested
|
|
|
(153
|
)
|
|
7.196
|
|
Forfeited
|
|
|
(11
|
)
|
|
5.844
|
|
Nonvested
at end of period
|
|
|
698
|
|
$
|
8.711
|
|
As
of
April 1, 2006 there was $4.9 million of total unrecognized compensation cost
related to nonvested share-based compensation arrangements granted under the
Plans. That cost is expected to be recognized over a weighted-average period
of
2.1 years.
Stock
Awards:
Under
the
Stock Plan, employees and nonemployee directors may be granted stock awards
or
grants of restricted shares of the Company’s common stock, vesting subject to
the employees’ performance of certain goals. The Stock Plan is an amendment and
restatement of the Franklin Electric Co., Inc. Key Employee Performance
Incentive Stock Plan (the “Incentive Plan”), established in 2000. Prior to April
29, 2005, 16,300 shares had been awarded under the Incentive Plan and an
additional 150,000 shares were authorized for stock awards under the Stock
Plan.
The
stock
awards and the restricted stock awards cliff vest over either 4 or 5 years
and
the attainment of certain performance goals. Dividends are paid to the recipient
prior to vesting. Stock awards granted to retirement eligible employees were
immediately expensed in 2006. There were no grants made to retirement eligible
employees in 2005.
A
summary
of the Company’s restricted stock award activity and related information, for
the first quarter ended April 1, 2006 follows:
(shares
in thousands)
Nonvested
Shares
|
|
Shares
|
|
Weighted-Average
Grant Date
Fair Value
|
|
Nonvested
at beginning of period
|
|
|
21
|
|
$
|
40.824
|
|
Awarded
|
|
|
19
|
|
|
45.798
|
|
Vested
|
|
|
-
|
|
|
-
|
|
Forfeited
|
|
|
(1
|
)
|
|
40.720
|
|
Nonvested
at end of period
|
|
|
39
|
|
$
|
43.199
|
|
As
of
April 1, 2006 there was $1.3 million of total unrecognized compensation cost
related to nonvested share-based compensation arrangements granted under the
Plan. That cost is expected to be recognized over a weighted-average period
of
3.4 years.
Note
13: Subsequent Events
Subsequent
to April 1, 2006, the Company acquired the stock of Little Giant Pump Company
for $121 million, subject to a purchase price adjustment based on closing date
net working capital. Little Giant, formerly a wholly owned subsidiary of
Tecumseh Products Company, is a leading worldwide provider of commercial and
consumer water transfer solutions.
Item
2. Management’s Discussion And Analysis Of Financial Condition And Results Of
Operations
Overview
Sales
and
earnings for the first quarter of 2006 were up from the same quarter of 2005.
The increase in first quarter 2006 sales was primarily attributable to increased
demand for Water Systems products from domestic distributors and pump
manufacturers. Prior year first quarter sales and earnings were up from the
same
quarter of 2004. The increase in first quarter 2005 sales was attributable
to
the impact of changes in the Company’s sales discount programs, price increases,
improved mix of direct sales to distributors and foreign exchange rate changes.
Earnings improved in the first quarter of 2006 and 2005 primarily due to the
increased sales. Earnings for the first quarter of 2006 were partially offset
by
stock based compensation expense and commodity price increases. The Company
adopted SFAS No. 123(R) “Share Based Payments” as of January 2006. Earnings for
the first quarter of 2005 were partially offset by increased commodity prices
and expenses associated with the Company’s Global Manufacturing Realignment
Program, the first phase of which was considered substantially complete as
of
the end of 2005.
Results
of Operations
Net
sales
for the first quarter of 2006 were $111.0 million, an increase of $28.5 million
or 35 percent from 2005 first quarter net sales of $82.4 million. Foreign
currencies, particularly the euro, weakened relative to the U.S. dollar compared
to the first quarter of 2005. The impact of the changes in exchange rates was
a
$2.0 million decrease in the Company’s reported 2006 sales. Sales related to the
third quarter 2005 acquisition of Phil-Tite Enterprises were $0.9 million for
the first quarter of 2006. Selling price changes increased net sales by $2.6
million or about 3 percent. The volume increase in sales is primarily
attributable to higher demand for Water Systems products from domestic
distributors and pump manufacturers. Submersible motor sales increased across
the entire product range. A portion of the motor sales growth may have
been attributable to submersible motor inventory increases by major pump
manufacturers purchasing additional quantities as a hedge against future supply
uncertainties. Water Systems pump sales increased with unit volumes up over
150
percent in 2006 versus the first quarter of 2005. Fueling Systems product sales
were also up about 35 percent from the prior year first quarter. Most of the
Fueling Systems sales growth was the result of increased demand for Franklin’s
piping and fuel pumping product lines. Net sales for European operations
increased 6 percent in the first quarter of 2006 after the effect of foreign
currency exchange rate changes or 15 percent in local currency.
Cost
of
sales as a percent of net sales for the first quarter of 2006 was 67.0 percent,
down from the first quarter of 2005 of 69.1 percent. Cost of sales as a percent
of net sales decreased primarily as a result of the increased sales. The
decrease in cost of sales as a percent of net sales during the first quarter
of
2006 was partially offset by increased costs for certain commodities used in
the
manufacture of electric motors, primarily copper.
Selling
and administrative (“SG&A”) expenses, at $21.6 million for the first quarter
of 2006, were up $5.3 million from the first quarter of 2005. The increase
in
the first quarter of 2006 was partially due to additional marketing and selling
expenses of $1.2 million domestically related to the Water Systems distribution
channel initiative and higher commissions and other compensation expenses tied
to revenues and earnings, both of which increased relative to the first quarter
of 2005. The first quarter of 2006 included $0.9 million of expense related
to
stock based compensation in accordance with the adoption of SFAS No. 123 (R)
“Share Based Payments”.
Interest
expense for the first quarter of 2006 and 2005 was $0.2 million.
Foreign
currency-based transactions resulted in a slight loss for the first quarter
of
2006. Foreign currency-based transactions resulted in a slight gain for the
first quarter 2005.
The
provision for income taxes for the first quarter of 2006 is $5.5 million. The
effective tax rate for 2006 is projected at 36.1 percent, up from the prior
year
rate of 35.3 percent, primarily because the R&D credit deduction has not
been renewed by Congress. The effective tax rate differs from the United States
statutory rate of 35 percent, due to the foreign income exclusion and the
effects of state and foreign income taxes, net of federal tax
benefits.
Net
income for the first quarter of 2006 was $9.7 million, or $0.42 per diluted
share, compared to the first quarter of 2005 net income of $5.8 million, or
$0.25 per diluted share.
Capital
Resources and Liquidity
Operating
activities consumed approximately $18.2 million of cash during the first quarter
of 2006 compared to cash consumed during the first quarter of 2005 of $8.1
million. The operating cash flows used in the first quarter of 2006 are
primarily related to an increase in receivables due to the higher sales, about
$12.1 million, and an increase in inventory, about $9.9 million. Inventories
increased primarily in finished goods due to seasonal inventory buildup. The
operating cash flow used in the first quarter of 2005 is primarily related
to an
increase in inventory, about $18.3 million. Inventories increased primarily
in
finished goods as the Company’s sales are generally lower during the first
quarter of the year.
The
primary sources and uses of cash for investing activities for the first quarter
of 2006 and 2005 were for the buying and selling of short term investment
securities.
Net
cash
flows from financing activities during the first quarters of 2006 and 2005
were
$1.9 million and $0.0 million, respectively. The principal source of cash from
financing activities during 2006 and 2005 was from the issuance of common stock
related to the exercise of stock options. The principal uses of cash during
2005
were for purchases of Company common stock under the Company’s repurchase
program and the payment of dividends.
Cash
and
equivalents at the end of the first quarters of 2006 and 2005 were $69.4 million
and $23.1 million, respectively.
In
September 2004, the Company entered into an unsecured, 60 month $80.0 million
revolving credit agreement (the “Agreement”). The Agreement includes a facility
fee of one-tenth of one percent on the committed amount. As of April 1, 2006,
the Company had no outstanding borrowings under the agreement.
During
the first fiscal quarter, there has been no significant change in the Company’s
current commitments, as reported in its annual report on Form 10-K for the
year
ended January 1, 2005.
Item
3. Quantitative and Qualitative Disclosures about Market Risk
The
Company is subject to market risk associated with changes in foreign currency
exchange rates and interest rates. Foreign currency exchange rate risk is
mitigated through several means: maintenance of local production facilities
in
the markets served, invoicing of customers in the same currency as the source
of
the products, prompt settlement of inter-company balances utilizing a global
netting system and limited use of foreign currency denominated debt. Interest
rate exposure is limited to variable rate interest borrowings under the
Company's revolving credit agreement and an interest rate swap.
Item
4. Controls and Procedures
As
of the
end of the period covered by this report (the "Evaluation Date"), the Company
carried out an evaluation, under the supervision and with the participation
of
the Company's management, including the Company's Chief Executive Officer and
Chief Financial Officer, of the effectiveness of the design and operation of
the
Company's disclosure controls and procedures (as such term is defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)). Based
upon that evaluation, the Company's Chief Executive Officer and Chief Financial
Officer concluded that, as of the Evaluation Date, the Company's disclosure
controls and procedures are effective in bringing to their attention on a timely
basis material information relating to the Company to be included in the
Company’s periodic reporting under the Exchange Act.
During
the first fiscal quarter there have been no changes in the Company's internal
control over financial reporting that have materially affected or that are
reasonably likely to materially affect the Company's internal control over
financial reporting.
PART
II.
OTHER INFORMATION
Items
1A. Risk Factors
Item
1A.,
to the Company’s form 10-K, provides the principle risk factors affecting the
Company and its business and is incorporated by reference herein. The following
describes additional risk factors identified or arising subsequent to the year
ended January 1, 2006. Additional risks and uncertainties, not presently known
to the Company or currently deemed immaterial, could negatively impact the
Company’s results of operations or financial condition in the future.
The
Company’s costs of products sold are impacted by changes in costs of commodities
used in raw materials and fuels used for heating and
transportation.
The
Company uses raw materials, primarily steel, stainless steel, copper and
aluminum, which are significantly impacted by changes in the base metal
commodity costs. Manufacturing facilities as well as certain manufacturing
processes utilize natural gas for heating. Transportation costs of both raw
material and finished goods are impacted by fluctuations in fuel oil prices.
One
way the Company mitigates the risks of increases in these and other costs is
by
increasing selling prices to its customers. If the increased competition in
the
markets the Company serves results in an inability to increase selling prices
during a period of increasing commodity and fuel costs, earnings could be
negatively impacted.
The
Company must integrate a significant acquisition, which closed subsequent to
the
end of the first quarter of 2006.
As
part
of our on-going marketing strategy to expand our pump offerings and broaden
our
customer base the Company acquired Little Giant Pump Company, a manufacturer
of
pumps used primarily in wastewater applications as well as other commercial
and
consumer water transfer applications. The Company believes that successful
integration of this acquisition will enhance the Company’s competitive position
as a global supplier of pumping equipment for residential and commercial markets
and result in increased sales and earnings; however, actual results may
vary.
The
Company must further upgrade its technological processes to support its growth
and product expansion.
Technology
based processes must be further upgraded to support the Company’s current growth
and new product expansion. Changes to technologically based processes impact
the
Company’s resources and earnings. The Company believes that the successful
upgrade of these processes will enhance its competitiveness and support future
growth; however, actual results may vary.
Additional
Risks to the Company
The
Company is also subject to various risks occurring in the normal course of
business. Exhibit 99.1, to the Company’s form 10-K, sets forth a list of risks,
including those identified above, that may adversely affect the Company and
its
business and is incorporated herein by reference.
Item
2. Unregistered Sales of Equity Securities and Use of Proceeds
(c)
Issuer Repurchases of Equity Securities
|
|
|
|
|
|
Total
Number
|
|
Maximum
Number
|
|
|
|
Total
|
|
|
|
of
Shares
|
|
of
Shares
|
|
|
|
Number
|
|
Average
|
|
Purchased
as
|
|
that
May Yet be
|
|
|
|
Of
Shares
|
|
Price
Paid
|
|
Part
of Publicly
|
|
Purchased
Under
|
|
|
|
Purchased
|
|
per
Share
|
|
Announced
Plan
|
|
the
Plan
|
|
Period
|
|
|
|
|
|
|
|
|
|
Jan
1, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Feb
4, 2006
|
|
|
5,000
|
|
$
|
39.545
|
|
|
5,000
|
|
|
628,692
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Feb
5, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mar
4, 2006
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
628,692
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mar
5, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Apr
1, 2006
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
628,692
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
5,000
|
|
$
|
39.545
|
|
|
5,000
|
|
|
|
|
On
February 16, 2001, the Company’s Board of Directors unanimously approved a
resolution to repurchase 2,000,000 shares. On February 11, 2005, the
Company’s Board of Directors unanimously approved a resolution to increase the
number of shares remaining for repurchase from 827,412 shares then remaining
to
1,000,000 shares. There is no expiration date for the plan.
Item
4. Submission of Matters to a Vote of Security Holders
The
2006
Annual Meeting of Shareholders of the Company was held on April 28, 2006 to:
1)
elect three directors for terms expiring at the 2009 Annual Meeting of
Shareholders; and 2) ratify the appointment of Deloitte & Touche LLP as the
Company’s independent registered public accounting firm for the 2006 fiscal
year.
All
of
the matters submitted to a vote of shareholders were approved, as shown by
the
following voting results.
1)
Nominees
for Director
|
For
|
Withhold
Authority
|
|
|
|
Jerome
D. Brady
|
20,685,826
|
50,217
|
Diana
S. Ferguson
|
20,682,098
|
53,945
|
David
M. Wathen
|
20,685,746
|
50,297
|
|
2)
Ratification of Deloitte & Touche LLP
|
|
For
|
Against
|
Abstain
|
20,625,687
|
84,737
|
25,619
|
|
Total
shares represented at the Annual Meeting in person or by proxy were 20,736,043
of a total of 22,601,412 shares outstanding. This represented 91.8 percent
of
Company common stock and constituted a quorum. There were no broker non-votes
on
either matter approved by Shareholders.
Item
5. Other Information
On
April
28, 2006, the Board of Directors of Franklin Electric Co., Inc. adopted the
amended and restated Nonemployee Directors’ Deferred Compensation Plan (the
“Plan”). The Plan permits each nonemployee director to make an annual election
to defer receipt of all of the annual retainer fee, the fees paid for attending
Board and Committee meetings, the fees, if any, paid for services as Chairman
of
a Board Committee, and all of the stock award that otherwise would be granted
under the Company’s Stock Plan. The nonemployee director can direct that all of
the deferred fees be either converted into stock units that are credited to
the
nonemployee director’s stock unit account or credited as a cash amount to the
nonemployee director’s cash account. The deferred stock award is converted into
stock units that are credited to the nonemployee director’s stock unit account.
The cash account is credited with interest on a monthly basis. Additional
credits are made to the stock unit account in amounts equal to the cash
dividends that the nonemployee director would have paid had he or she been
the
owner on each record date of a number of shares of common stock equal to the
number of stock units in his or her stock unit account on such date. Once
amounts have been held in the stock unit account for three years, a nonemployee
director can transfer such amounts to the cash account. No other transfers
are
permitted. Distribution of a nonemployee director’s accounts will be made the
January 31 following his or her termination of service on the Board.
Distribution of the stock account will be made in cash or shares of stock as
elected by the nonemployee director and distribution of the cash account will
be
made in cash.
Prior
to
its amendment and restatement, the Plan permitted a nonemployee director to
defer only the annual retainer fee, and the fee was converted into stock units.
The stock unit account was distributable on the January 31 following termination
of service on the Board, in shares of stock or cash as elected by the
nonemployee director.
This
description of the Plan is qualified in its entirety by the terms and conditions
of the Plan, which is filed as Exhibit 10.1 hereto and is incorporated herein
by
reference.
Item
6. Exhibits
See
the
Exhibit Index located on page 19.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this quarterly report to be signed on its behalf by the undersigned
thereunto duly authorized.
|
|
|
FRANKLIN
ELECTRIC CO., INC.
|
|
|
|
Registrant
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date
May
8, 2006
|
|
By
|
/s/
R. Scott Trumbull
|
|
|
|
R.
Scott Trumbull, Chairman and Chief Executive Officer (Principal Executive
Officer)
|
|
|
|
|
|
|
|
|
|
|
|
|
Date
May
8, 2006
|
|
By
|
/s/
Thomas J. Strupp
|
|
|
|
Thomas
J. Strupp, Vice President and Chief Financial Officer and Secretary
(Principal Financial and Accounting
Officer)
|
FRANKLIN
ELECTRIC CO., INC.
EXHIBIT
INDEX TO THE QUARTERLY REPORT ON FORM 10-Q
FOR
THE
FIRST QUARTER ENDED APRIL 1, 2006
|
|
Number
|
Description
|
|
|
10.1
|
Franklin
Electric Co., Inc. Nonemployee Directors’ Deferred Compensation Plan, as
Amended and Restated
|
|
|
31.1
|
Certification
of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
|
|
31.2
|
Certification
of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
|
|
32.1
|
Chief
Executive Officer Certification Pursuant to 18 U.S.C. Section 1350
As
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
|
|
|
32.2
|
Chief
Financial Officer Certification Pursuant to 18 U.S.C. Section 1350
As
Adopted Pursuant to Section 906 of the Sarbanes- Oxley Act of
2002
|
|
|