2008 Annual Report - Hubbell Wiring Device-Kellems

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0Corporate Performance GraphThe following graph compares the total return to shareholders on the Company’s Class B Common Stockduring the five years ended December 31, 2008, with a cumulative total return on the (i) Standard & Poor’s MidCap400 (“S&P MidCap 400”) and (ii) the Dow Jones U.S. Electrical Components & Equipment Index (“DJUSEC”).The Company is a member of the S&P MidCap 400. As of December 31, 2008, the DJUSEC reflects a group ofapproximately thirty-four company stocks in the electrical components and equipment market segment, and servesas the Company’s peer group. The comparison assumes $100 was invested on December 31, 2003 in the Company’sClass B Common Stock and in each of the foregoing indices and assumes reinvestment of dividends.$180COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*Among Hubbell, Inc., The S&P Midcap 400 IndexAnd The Dow Jones US Electrical Components & Equipment Index$160$140$120$100$80$60$40$20$012/03 12/04 12/05 12/06 12/07 12/08Hubbell, Inc.S&P Midcap 400Dow Jones US Electrical Components & Equipment* $100 invested on 12/31/03 in stock or index-including reinvestment of dividends. Fiscal year endingDecember 31.Copyright © 2009, Standard & Poor’s, a division of The McGraw-Hill Companies, Inc. All rights reserved.Copyright © 2009 Dow Jones & Co. All right reserved.16
Item 6.Selected Financial DataThe following summary should be read in conjunction with the consolidated financial statements and notescontained herein (dollars and shares in millions, except per share amounts).2008 2007 2006 2005 2004OPERATIONS, years ended December 31,Net sales. ............................... $2,704.4 $2,533.9 $2,414.3 $2,104.9 $1,993.0Gross profit ............................. $ 803.4 $ 735.8 $ 656.8 (1) $ 595.0 (1) $ 561.9 (1)Special charges, net. ....................... $ — $ — $ 7.3 (1) $ 10.3 (1) $ 15.4 (1)Operating income ......................... $ 346.0 (3) $ 299.4 (3) $ 233.9 (3) $ 226.8 $ 212.6Operating income as a % of sales ............. 12.8% 11.8% 9.7% 10.8% 10.7%Net income .............................. $ 222.7 $ 208.3 (4) $ 158.1 $ 165.1 (4) $ 154.7 (4)Net income as a % of sales .................. 8.2% 8.2% 6.5% 7.8% 7.8%Net income to common shareholders’ averageequity ................................ 21.3% 19.9% 15.7% 17.0% 17.4%Earnings per share — Diluted . . . ............. $ 3.94 $ 3.50 $ 2.59 $ 2.67 $ 2.51Cash dividends declared per common share ...... $ 1.38 $ 1.32 $ 1.32 $ 1.32 $ 1.32Average number of common shares outstanding —diluted ............................... 56.5 59.5 61.1 61.8 61.6Cost of acquisitions, net of cash acquired. ....... $ 267.4 $ 52.9 $ 145.7 $ 54.3 $ —FINANCIAL POSITION, at year-endWorking capital .......................... $ 494.1 $ 368.5 $ 432.1 $ 459.6 $ 483.1Total assets .............................. $2,115.5 $1,863.4 $1,751.5 $1,667.0 $1,656.4Total debt ............................... $ 497.4 $ 236.1 $ 220.2 $ 228.8 $ 299.0Debt to total capitalization (5) ................. 33% 18% 18% 19% 24%Common shareholders’ equity:Total ................................. $1,008.1 (2) $1,082.6 (2) $1,015.5 (2) $ 998.1 $ 944.3Per share .............................. $ 17.84 $ 18.19 $ 16.62 $ 16.15 $ 15.33NUMBER OF EMPLOYEES, at year-end ..... 13,000 11,500 12,000 11,300 11,400(1) The Company recorded pretax special charges in 2004 through 2006. These special charges primarily related toa series of actions related to the consolidation of manufacturing, sales and administrative functions across ourcommercial and industrial lighting businesses. Also included were costs associated with the closure of a wiringproducts factory in Puerto Rico. These actions were significantly completed as of December 31, 2006.(2) Effective December 31, 2006, the Company adopted Statement of Financial Accounting Standards (“SFAS”)No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendmentof Financial Accounting Standards Board (“FASB”) Statements No. 87, 88, 106, and 132(R)”. Relatedadjustments to Shareholders’ equity resulted in a charge of $92.1 million, net of tax in 2008, a credit of$44.9 million, net of tax in 2007 and a charge of $36.8 million, net of tax in 2006.(3) In 2008, 2007, and 2006, operating income includes stock-based compensation expense of $12.5 million,$12.7 million and $11.8 million, respectively. On January 1, 2006 the Company adopted the modifiedprospective transition method of SFAS No. 123(R) and therefore previously reported amounts have not beenrestated.(4) In 2007, 2005 and 2004, the Company recorded tax benefits of $5.3 million, $10.8 million and $10.2 million,respectively, in Provision for income taxes related to the completion of U.S. Internal Revenue Service (“IRS”)examinations for tax years through 2005.(5) Debt to total capitalization is defined as total debt as a percentage of the sum of total debt and shareholders’equity.17
Page 1 and 2: P O S I T I O N E D F O R T O D A Y
Page 3 and 4: 2008 SALESby Segmentby GeographyPow
Page 5 and 6: The success of “today” position
Page 7 and 8: POSITIONED FOR TODAYby consistently
Page 9 and 10: POWER SEGMENTBrand recognition and
Page 11 and 12: DRIVINGPERFORMANCETHROUGHPRODUCTIVI
Page 13 and 14: KURT VERSEN INC,ACQUIRED IN JANUARY
Page 15 and 16: 13THE LIGHTING SOLUTIONSLAB AT HUBB
Page 17 and 18: THE FUTURE ISELECTRIC WITHOPPORTUNI
Page 19: OFFSHORE OIL RIGS AREJUST ONE OF MA
Page 23 and 24: HUBBELL INCORPORATEDANNUAL REPORT O
Page 25 and 26: The Company’s annual report on Fo
Page 27 and 28: Commercial/Institutional and Indust
Page 29 and 30: Haefely Test, AG based in Switzerla
Page 31 and 32: A global recession and continued wo
Page 33 and 34: Item 2. PropertiesHubbell’s manuf
Page 35 and 36: Name. Age(1) Present Position Busin
Page 37: Purchases of Equity SecuritiesIn Fe
Page 41 and 42: • Revenue GrowthOrganic Growth. I
Page 43 and 44: the 2007 rate related to the closin
Page 45 and 46: one in 2007 as well as a higher amo
Page 47 and 48: management, production planning and
Page 49 and 50: Although these facilities are not t
Page 51 and 52: offer retiree medical benefits to a
Page 53 and 54: overhead, maintenance and training
Page 55 and 56: • Changes in strategy, economic c
Page 57 and 58: Item 8.Financial Statements and Sup
Page 59 and 60: REPORT OF INDEPENDENT REGISTERED PU
Page 61 and 62: HUBBELL INCORPORATED AND SUBSIDIARI
Page 65 and 66: Foreign Currency TranslationThe ass
Page 67 and 68: measurement attribute for the finan
Page 81 and 82: Note 12 — DebtHUBBELL INCORPORATE
Page 87 and 88: Note 17 — Capital StockHUBBELL IN
Page 89 and 90:
HUBBELL INCORPORATED AND SUBSIDIARI
Page 91 and 92:
Page 93 and 94:
computation of earnings per dilutiv
Page 95 and 96:
Industry Segment DataHUBBELL INCORP
Page 97 and 98:
Page 99 and 100:
Item 11.Item 12.Executive Compensat
Page 101 and 102:
NumberDescription10h† Hubbell Inc
Page 103 and 104:
NumberDescription31.1* Certificatio
Page 105 and 106:
Schedule IIHUBBELL INCORPORATED AND
Page 107 and 108:
Exhibit 31.1I, Timothy H. Powers, c
Page 109 and 110:
Exhibit 32.1CERTIFICATION PURSUANT
Page 111 and 112:
BOARD OF DIRECTORSE. RICHARD BROOKS
Page 113 and 114:
CORPORATEOFFICERSTIMOTHY H. POWERSC
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