timken_2 - Tr a n s f o r m a t i o n D e l i v e r s S t r...

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2002 I ANNUAL REPORT Transformation Delivers Strong Year–Winning Future
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+ TORRINGTON TWO GREAT NAMES = ONE GREAT COMPANY
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About the cover … The Timken Company has transformed, putting the pieces in place for a firm foundation of increased profitability, innovation, customer centricity and cost competi- tiveness. Completing the Torrington acquisition has given us the additional resources to build upon that foundation to increase dramatically our value to customers and shareholders. While we will capture $80 million annually in synergies by 2005, this acquisition is really about profitability and growth … based on acquiring a similar, successful company with a complementary product offering. The new Timken Company is a global leader in three complementary product and service lines: tapered roller bearings, needle roller bearings and alloy steels. We become a $3.6 billion company with operations in 29 countries and still headquartered in Canton, Ohio. The year 2002 has positioned us for an explosion of innova- tion and value creation.
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’98 ’99 ’00 ’01 $3,000 $2,500 $1,500 $500 $2,000 $1,000 Net Sales ($ Millions) ’02 ’98 ’99 ’00 ’01 $0.80 $0.50 $0.30 $0.10 $0.40 $0.20 Dividends Per Share ’02 $0.60 $0.70 contents 2 Letter to Shareholders 6 Two Great Names One Great Company 8 Innovation Creates Value 12 Services: Key to Growth 15 Beyond the Bearing 16 Value Chain Growth 18 Corporate Profile 21 Financial Information 50 Directors and Officers 51 Shareholder Information ’98 ’99 ’00 ’01 $2.00 $0.50 $-0.50 Earnings Per Share – Diluted ’02 $1.00 $1.50 $0.00 $2.50
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2002 2001 (Thousands of dollars, except per share data) Net sales $ 2,550,075 $ 2,447,178 Impairment and restructuring charges 32,143 54,689 Income (loss) before income taxes and cumulative effect of change in accounting principle 85,518 (26,883) Provision for income taxes 34,067 14,783 Income (loss) before cumulative effect of change in accounting principle $ 51,451 (41,666) Net income (loss) $ 38,749 $ (41,666) Earnings per share $ .63 $(.69) Earnings per share - assuming dilution $ .62 $(.69) Dividends per share $ .52 $ .67 financial summary 2002 Stock Prices High Low Q1 $24.50 $15.35 Q2 27.41 20.50 Q3 24.00 16.54 Q4 20.27 14.92 2001 Stock Prices High Low Q1 $17.38 $14.63 Q2 18.65 14.89 Q3 17.16 11.75 Q4 16.49 13.04 (1) Net income (loss) and earnings per share for Q1 reflect the cumulative effect of change in accounting principle in accordance with the adoption of Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets." The change reduced net income (loss) by $12.7 million or $.21 per share. (2) Includes receipt (net of expenses) of $50.2 million and $29.6 million in 2002 and 2001 resulting from the U.S. Continued Dumping and Subsidy Offset Act. (3) Annual earnings per share do not equal the sum of the individual quarters due to differences in the average number of shares outstanding during the respective periods. Net Dividends Net Gross Impairment & Income Earnings Per Share (3) Per 2002 Sales Profit Restructuring (Loss) Basic Diluted Share (Thousands of dollars, except per share data) Q1 (1) $ 615,757 $ 118,642 $ 3,057 $ (3,514) $ (.06) $ (.06) $ .13 Q2 660,829 124,301 14,226 3,960 .07 .07 .13 Q3 (3) 628,591 111,262 7,703 1,837 .03 .03 .13 Q4 644,898 115,372 7,157 36,466 (2) .58 .57 .13 $ 2,550,075 $ 469,577 $ 32,143 $ 38,749 $ .63 $ .62 $ .52 2001 (Thousands of dollars, except per share data) Q1 $ 661,516 $ 118,014 $ 7,907 $ 2,222 $ .04 $ .04 $ .18 Q2 634,389 111,083 16,859 (14,574) (.24) (.24) .18 Q3 577,698 90,951 24,639 (30,532) (.51) (.51) .18 Q4 573,575 80,672 5,284 1,218 (2) .02 .02 .13 $ 2,447,178 $ 400,720 $ 54,689 $ (41,666) $ (.69) $ (.69) $ .67 quarterly
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This note was uploaded on 06/20/2011 for the course ECON NgocAnhNo1 taught by Professor Ngocanhno1 during the Spring '11 term at Université de Genève.

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timken_2 - Tr a n s f o r m a t i o n D e l i v e r s S t r...

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