Exhibit 99.1 Actuant Reports Record Third Quarter Sales and Earnings MILWAUKEE--(BUSINESS WIRE)--June 18, 2003--Actuant Corporation (NYSE:ATU) today announced results for its third quarter ended May 31, 2003. Sales increased approximately 23% to $147.2 million compared to $120.0 million in the prior year. Current year results include those from Heinrich Kopp AG ("Kopp"), which was acquired on September 3, 2002. Excluding Kopp and the impact of foreign currency exchange rate changes on translated results, third quarter sales decreased approximately 3%. Third quarter fiscal 2003 net earnings and diluted earnings per share ("diluted EPS") were $10.0 million and $0.82 per diluted share, respectively. This compares favorably to a net loss in the third quarter of the prior year of $11.0 million, or $0.95 per diluted share. The prior year loss included a $14.3 million pre-tax charge for early extinguishment of debt ($9.3 million or $0.80 per share, net of tax) and a net $10.0 million, or $0.86 per share, discontinued operations charge. Excluding these two items, prior year net earnings were $8.3 million, or $0.68 per diluted share. Sales for the nine months ended May 31, 2003 were $437.1 million, approximately 28% higher than the $341.6 million in the comparable prior year period. Excluding Kopp and the impact of foreign currency rate changes on translated results, sales for the year-to-date period increased 1%. Net earnings for the nine months ended May 31, 2003 were $18.9 million, or $1.55 per diluted share, compared to a loss of $9.6 million, or $0.96 per diluted share, for the comparable prior year period. In fiscal 2003, the Company recorded net of tax special charges of $1.3 million, or $0.10 per diluted share, related to the early extinguishment of debt and $4.2 million, or $0.34 per diluted share, related to litigation matters associated with businesses divested prior to the spin-off in July 2000. In fiscal 2002 the Company adopted Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets", which resulted in a net cumulative effect of accounting change charge of $7.2 million, or $0.72 per diluted share. Fiscal 2002 results also included the $14.3 million pre-tax early extinguishment of debt charge and the $10.0 million net discontinued operations charge discussed above. Excluding these special charges, net earnings and diluted earnings per share for the nine months ended May 31, 2003 were $24.4 million, or $2.00 per diluted share, compared to $16.9 million, or $1.69 per diluted share, respectively, in the prior year. Commenting on the results, Robert C. Arzbaecher, Chairman, President and CEO of Actuant, stated, "We are pleased to report increased earnings for the third quarter. Business conditions were especially challenging as a result of the war in Iraq, lower recreational vehicle ("RV") production by OEM's in order to balance dealer inventory, and the overall weak economy. Despite these conditions, we were able to deliver satisfactory results by focusing on our customers and aggressively managing our costs. Actuant's year-to-date earnings per share excluding special items are 18% above last year. Excluding the special items, Actuant has increased its earnings per share in each of the last eight quarters." He continued, "We are also happy to report that during the third quarter we settled the litigation relating to a previously divested business unit for less than the related charge we recorded in the first quarter's results. This resulted in a $0.8 million, or $0.04 per diluted share, non-operating gain during the third quarter. The settlement will be paid in the fourth quarter. Third quarter cash flow was strong as we reduced our total quarter-end borrowings to below $190 million for the first time, despite a $7 million semi-annual bond interest payment during the quarter. "Given the economic environment, we continued to focus on cost reductions during the quarter and commenced many of the actions we announced last quarter to remain competitive in the marketplace. Such initiatives resulted in pre-tax downsizing expenses in our third quarter results of approximately $1.2 million ($0.06 per diluted share), and included personnel reductions in a number of businesses, as well as the consolidation of small production and distribution facilities. These previously announced actions will continue into the fourth quarter. Additionally, we completed the closure of one of Kopp's German manufacturing plants and continue to work on additional cost reductions to increase Kopp's profit margins." Fiscal 2003 third quarter sales in the Tools & Supplies segment were $91.4 million, or approximately 39% higher than last year's $65.7 million due primarily to the Kopp acquisition and foreign currency rate changes. Excluding Kopp and the impact of foreign currency rate changes, Tools & Supplies segment revenues were down 2% during the quarter versus the comparable prior year period primarily due to the weak U.S. economy. Current year third quarter sales in the Engineered Solutions segment increased approximately 3% to $55.8 million, compared to $54.3 million in the previous year. Excluding foreign currency rate changes, Engineered Solutions sales decreased 5%, reflecting the expected lower sales to RV OEM's. Actuant's third quarter operating profit and EBITDA (net earnings before interest, income taxes, depreciation, amortization and minority interest deduction) were $19.4 million and $24.3 million, compared to $19.7 million and $22.7 million, respectively, in the comparable prior year period. EBITDA is an important non-GAAP financial metric used by many investors to determine the Company's credit ratios and loan covenant compliance. As previously noted, operating profit included approximately $1.2 million of downsizing related costs, as well as the results of recently acquired Kopp which currently generates a much lower profit margin than Actuant's other units. Net debt (total debt less cash) decreased approximately $7 million during the quarter to $184.8 million at May 31, 2003. The Company acquired a small hydraulics company in China during the quarter for approximately $1.7 million, including assumed liabilities. Its impact on third quarter operating results was nominal. Availability under the Company's senior credit facility revolver was approximately $85 million at May 31, 2003. Commenting on the outlook for the final quarter of fiscal 2003, Arzbaecher said, "We expect fourth quarter results to be improved over prior year results, despite our view that short term economic conditions will remain weak and our expectation of incurring additional downsizing costs in the fourth quarter. Specifically, we are projecting fiscal fourth quarter sales in the $140-$145 million range and earnings per share in the $0.75-$0.80 range. This would equate to full year fiscal 2003 sales of $579-$584 million and diluted EPS of $2.75-$2.80, excluding special charges. Looking ahead to fiscal 2004, our initial guidance anticipates modest improvements in the economy, a continued low interest rate environment, and today's accounting rules and currency rates. We expect diluted earnings to be $3.10-$3.40 per share on sales of $610-$630 million. Provided we can achieve these targeted earnings, it would be our third consecutive year of double digit EPS growth, ignoring special charges and gains." Actuant, headquartered in Milwaukee, Wisconsin, is a diversified industrial company with operations in more than 20 countries. The Actuant businesses are leading companies in highly engineered position and motion control systems and branded tools. Products are offered under such established brand names as Enerpac, Gardner Bender, Kopp, Milwaukee Cylinder, Nielsen Sessions, Power-Packer, and Power Gear. Safe Harbor Statement Certain of the above comments represent forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. Management cautions that these statements are based on current estimates of future performance and are highly dependent upon a variety of factors, which could cause actual results to differ from these estimates. Actuant's results are also subject to general economic conditions, variation in demand from customers, the impact on the economy of terrorist attacks and other geopolitical activity, the length of the current recession in the Company's markets, continued market acceptance of the Company's new product introductions, the successful integration of business unit acquisitions and related restructuring, operating margin risk due to competitive pricing and operating efficiencies, supply chain risk, material and labor cost increases, foreign currency fluctuations and interest rate risk. See the Company's registration statements filed with the Securities and Exchange Commission for further information regarding risk factors. For further information on Actuant and its business units, visit the company's website at www.actuant.com. (tables follow) Actuant Corporation Consolidated Balance Sheets (Dollars in thousands) May 31, August 31, 2003 2002 --------- --------- ASSETS Current assets Cash and cash equivalents $4,502 $3,043 Accounts receivable, net 89,256 58,304 Inventories, net 70,119 54,898 Deferred income taxes 19,536 9,127 Other current assets 4,849 4,592 --------- --------- Total Current Assets 188,262 129,964 Property, plant and equipment, net 64,197 36,828 Goodwill 101,670 101,361 Other intangible assets, net 19,673 18,466 Other long-term assets 8,724 7,992 --------- --------- Total Assets $382,526 $294,611 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Short-term borrowings $890 $2,993 Trade accounts payable 51,805 47,834 Accrued compensation and benefits 18,155 12,362 Income taxes payable 20,702 18,365 Current maturities of long-term debt 10,623 6,788 Other current liabilities 52,570 23,924 --------- --------- Total Current Liabilities 154,745 112,266 Long-term debt, less current maturities 177,761 182,783 Deferred income taxes 7,294 4,409 Pension and postretirement benefit accruals 29,658 11,550 Other long-term liabilities 26,945 27,222 Minority interest in net equity of consolidated affiliates 4,043 - Shareholders' equity Capital stock 2,344 2,319 Additional paid-in capital (521,519) (523,419) Accumulated other comprehensive income (loss) (16,850) (21,675) Stock held in trust (600) (511) Deferred compensation liability 600 511 Retained earnings 518,105 499,156 --------- --------- Total Shareholders' Deficit (17,920) (43,619) --------- --------- Total Liabilities and Shareholders' Equity $382,526 $294,611 ========= ========= Actuant Corporation Consolidated Statements of Earnings (In thousands except per share amounts) Three Months Ended Nine Months Ended May 31, May 31, ------------------ ------------------ 2003 2002 2003 2002 ------------------ ------------------ Net Sales $147,189 $120,009 $437,146 $341,583 Cost of Products Sold 98,386 78,417 295,952 225,268 ------------------ ------------------ Gross Profit 48,803 41,592 141,194 116,315 Selling, Administrative and Engineering Expenses 28,880 21,308 85,834 62,294 Amortization of Intangible Assets 530 616 1,750 1,848 ------------------ ------------------ Operating Profit 19,393 19,668 53,610 52,173 Net Financing Costs 5,177 6,914 16,282 26,611 Charge for Early Extinguishment of Debt - 14,298 1,974 14,298 Litigation Charge (Benefit) associated with Divested Businesses (798) - 6,502 - Other (Income) Expense, net (515) (57) (1,021) (798) ------------------ ------------------ Earnings (Loss) from Continuing Operations Before Income Taxes and Minority Interest 15,529 (1,487) 29,873 12,062 Income Tax Expense (Benefit) 5,482 (456) 10,574 4,494 Minority Interest, net of Income Taxes 70 - 350 - ------------------ ------------------ Earnings (Loss) from Continuing Operations 9,977 (1,031) 18,949 7,568 Discontinued Operations, net of Income Taxes - (10,000) - (10,000) Cumulative Effect of Change In Accounting Principle, net of Income Taxes - - - (7,200) ------------------ ------------------ Net Earnings (Loss) $9,977 $(11,031) $18,949 $(9,632) ================== ================== Basic Earnings (Loss) per Share Earnings (Loss) from Continuing Operations $0.85 $(0.09) $1.63 $0.80 Discontinued Operations, net of Income Taxes - (0.86) - (1.06) Cumulative Effect of Change in Accounting Principle, net of Income Taxes - - - (0.76) ------------------ ------------------ Total $0.85 $(0.95) $1.63 $(1.02) ================== ================== Diluted Earnings (Loss) per Share Earnings (Loss) from Continuing Operations $0.82 $(0.09) $1.55 $0.76 Discontinued Operations, net of Income Taxes - (0.86) - (1.00) Cumulative Effect of Change in Accounting Principle, net of Income Taxes - - - (0.72) ------------------ ------------------ Total $0.82 $(0.95) $1.55 $(0.96) ================== ================== Weighted Average Common Shares Outstanding (1) Basic 11,690 11,587 11,645 9,454 Diluted 12,174 11,587 12,203 9,995 (1) The increase in weighted average number of shares outstanding for the nine months ended May 31, 2003 as compared to the nine months ended May 31, 2002, reflects the impact of the February 13, 2002 equity offering. ACTUANT CORPORATION SUPPLEMENTAL UNAUDITED DATA (US dollars, in thousands) FISCAL 2002 --------------------------------------------- Q1 Q2 Q3 Q4 TOTAL --------------------------------------------- SALES TOOLS & SUPPLIES SEGMENT $64,067 $62,338 $65,746 $67,357 $259,508 ENGINEERED SOLUTIONS SEGMENT 49,073 46,096 54,263 54,010 203,442 --------------------------------------------- TOTAL REPORTED SALES $113,140 $108,434 $120,009 $121,367 $462,950 ============================================= % SALES GROWTH TOOLS & SUPPLIES SEGMENT ENGINEERED SOLUTIONS SEGMENT TOTAL REPORTED SALES OPERATING PROFIT TOOLS & SUPPLIES SEGMENT $11,565 $11,030 $12,805 $11,997 $47,397 ENGINEERED SOLUTIONS SEGMENT 7,036 4,984 8,317 8,436 28,773 CORPORATE / GENERAL (1,107) (1,003) (1,454) (1,474) (5,038) --------------------------------------------- TOTAL REPORTED RESULTS $17,494 $15,011 $19,668 $18,959 $71,132 ============================================= OPERATING PROFIT % TOOLS & SUPPLIES SEGMENT 18.1% 17.7% 19.5% 17.8% 18.3% ENGINEERED SOLUTIONS SEGMENT 14.3% 10.8% 15.3% 15.6% 14.1% TOTAL (INCL. CORPORATE) 15.5% 13.8% 16.4% 15.6% 15.4% EBITDA (1) TOOLS & SUPPLIES SEGMENT $13,271 $13,213 $14,574 $13,862 $54,920 ENGINEERED SOLUTIONS SEGMENT 8,014 6,776 8,997 8,900 32,687 CORPORATE / GENERAL (1,143) (798) (842) (471) (3,254) --------------------------------------------- TOTAL RECURRING EBITDA 20,142 19,191 22,729 22,291 84,353 OTHER ITEMS (2) - - (14,298) (2,060) (16,358) --------------------------------------------- TOTAL $20,142 $19,191 $8,431 $20,231 $67,995 ============================================= EBITDA % TOOLS & SUPPLIES SEGMENT 20.7% 21.2% 22.2% 20.6% 21.2% ENGINEERED SOLUTIONS SEGMENT 16.3% 14.7% 16.6% 16.5% 16.1% TOTAL RECURRING (INCL. CORPORATE) 17.8% 17.7% 18.9% 18.4% 18.2% OTHER FINANCIAL DATA DEPRECIATION & AMORTIZATION TOOLS & SUPPLIES SEGMENT $1,920 $1,978 $2,033 $2,051 $7,982 ENGINEERED SOLUTIONS SEGMENT 979 990 849 1,080 3,898 CORPORATE / GENERAL 109 111 122 140 482 --------------------------------------------- TOTAL DEPRECIATION & AMORTIZATION $3,008 $3,079 $3,004 $3,271 $12,362 ============================================= OTHER INCOME (EXPENSE) TOOLS & SUPPLIES SEGMENT $(214) $205 $(264) $(186) $(459) ENGINEERED SOLUTIONS SEGMENT (1) 802 (169) (616) 16 CORPORATE / GENERAL (145) 94 490 863 1,302 --------------------------------------------- TOTAL REPORTED RESULTS $(360) $1,101 $57 $61 $859 ============================================= LEVERAGE NET DEBT (3) $306 $201 $212 $190 LEVERAGE RATIO (4) 3.5 2.3 2.5 2.3 ACTUANT CORPORATION SUPPLEMENTAL UNAUDITED DATA (US dollars, in thousands) (continued) FISCAL 2003 --------------------------------------------- Q1 Q2 Q3 Q4 TOTAL --------------------------------------------- SALES TOOLS & SUPPLIES SEGMENT $92,014 $90,651 $91,386 $274,051 ENGINEERED SOLUTIONS SEGMENT 55,844 51,448 55,803 163,095 --------------------------------------------- TOTAL REPORTED SALES $147,858 $142,099 $147,189 $ - $437,146 ============================================= % SALES GROWTH TOOLS & SUPPLIES SEGMENT 43.6% 45.4% 39.0% 42.6% ENGINEERED SOLUTIONS SEGMENT 13.8% 11.6% 2.8% 9.1% TOTAL REPORTED SALES 30.7% 31.0% 22.6% 28.0% OPERATING PROFIT TOOLS & SUPPLIES SEGMENT $12,818 $12,224 $13,702 $38,744 ENGINEERED SOLUTIONS SEGMENT 6,616 5,760 7,648 20,024 CORPORATE / GENERAL (1,246) (1,955) (1,957) (5,158) --------------------------------------------- TOTAL REPORTED RESULTS $18,188 $16,029 $19,393 $ - $53,610 ============================================= OPERATING PROFIT % TOOLS & SUPPLIES SEGMENT 13.9% 13.5% 15.0% 14.1% ENGINEERED SOLUTIONS SEGMENT 11.8% 11.2% 13.7% 12.3% TOTAL (INCL. CORPORATE) 12.3% 11.3% 13.2% 12.3% EBITDA (1) TOOLS & SUPPLIES SEGMENT $15,126 $14,454 $16,829 $46,409 ENGINEERED SOLUTIONS SEGMENT 7,666 7,501 8,739 23,906 CORPORATE / GENERAL (1,161) (1,354) (2,028) (4,543) --------------------------------------------- TOTAL RECURRING EBITDA 21,631 20,601 23,540 - 65,772 OTHER ITEMS (2) (9,274) - 798 - (8,476) --------------------------------------------- TOTAL $12,357 $20,601 $24,338 $ - $57,296 ============================================= EBITDA % TOOLS & SUPPLIES SEGMENT 16.4% 15.9% 18.4% 16.9% ENGINEERED SOLUTIONS SEGMENT 13.7% 14.6% 15.7% 14.7% TOTAL RECURRING (INCL. CORPORATE) 14.6% 14.5% 16.0% 15.0% OTHER FINANCIAL DATA DEPRECIATION & AMORTIZATION TOOLS & SUPPLIES SEGMENT $2,413 $2,433 $2,137 $6,983 ENGINEERED SOLUTIONS SEGMENT 1,133 1,237 1,321 3,691 CORPORATE / GENERAL 143 150 174 467 --------------------------------------------- TOTAL DEPRECIATION & AMORTIZATION $3,689 $3,820 $3,632 $ - $11,141 ============================================= OTHER INCOME (EXPENSE) TOOLS & SUPPLIES SEGMENT $(105) $(203) $990 $682 ENGINEERED SOLUTIONS SEGMENT (83) 504 (230) 191 CORPORATE / GENERAL (58) 451 (245) 148 --------------------------------------------- TOTAL REPORTED RESULTS $(246) $752 $515 $ - $1,021 ============================================= LEVERAGE NET DEBT (3) $204 $192 $185 LEVERAGE RATIO (4) 2.4 2.2 2.1 (1) EBITDA excludes discontinued operations and cumulative effect of change in accounting principle. Segment EBITDA = segment operating profit + segment depreciation & amortization + segment other income - segment other expense (2) Other items in the second and third quarters of 2002 include charges associated with the early redemption of long-term debt. First quarter 2003 other items include a $2.0 million charge related to the early redemption of debt and a $7.3 million charge related to litigation for business units divested prior to the July 31, 2000 spin-off. Third quarter 2003 other items represents an $0.8 million reversal of a portion of the $7.3 million first quarter charge for the favorable settlement of such litigation. (3) Net debt = long-term debt + current maturities of long-term debt + short-term borrowings - cash and cash equivalents (4) Leverage ratio = net debt / trailing four quarters total recurring EBITDA CONTACT: Actuant Corporation Vice President & CFO Andrew Lampereur, 414/352-4160