Exhibit 99.1 Actuant Announces Record Second Quarter Results MILWAUKEE--(BUSINESS WIRE)--March 22, 2006--Actuant Corporation (NYSE:ATU) today announced results for its second quarter ended February 28, 2006. Second quarter fiscal 2006 net earnings and diluted earnings per share ("EPS") were $19.3 million and $0.63, respectively versus comparable prior year period net earnings and EPS of $15.2 million and $0.52, respectively. This represents 21% year-over-year EPS growth in the second quarter. Net earnings for the six-months ended February 28, 2006 were $40.6 million, or $1.33 per diluted share, compared to $32.1 million, or $1.13 per diluted share for the prior year period. Second quarter sales increased approximately 17% to $276.0 million compared to $235.3 million in the prior year. Current year results include those from Key Components, Inc. ("KCI"), Hedley Purvis Ltd., Hydratight Sweeney, and B.E.P. Marine Limited, which were acquired in the second quarter of fiscal 2005 or later. Excluding the impact of foreign currency exchange rate changes, second quarter core sales (year-over-year sales growth in both existing and acquired businesses) increased approximately 6% over the comparable prior year period. Sales for the quarter, excluding acquisitions and foreign currency rate changes, increased 8%. Sales for the six months ended February 28, 2006 were $559.9 million, approximately 29% higher than the $434.9 million in the comparable prior year period. Excluding the impact of foreign currency rate changes, core sales and sales excluding acquisitions for the six-month period both increased 3%. Robert C. Arzbaecher, President and CEO of Actuant, commented, "We are pleased with second quarter results, including the 17% sales and 21% EPS growth. In addition to 6% core sales growth in the quarter, we had sizeable margin expansion with operating margins up 120 basis points from the prior year." Arzbaecher continued, "On a segment basis, Tools & Supplies posted strong second quarter results, driven by robust demand in the industrial tools and North American electrical markets. Excluding the impact of foreign currency exchange rate changes, our Engineered Solutions segment core sales declined 1% from a year ago, a significant sequential improvement from the 11% year-over-year sales decline in the first quarter. The improvement was driven by a year-over-year rebound in automotive sales, which were up 5% in the second quarter compared to a 29% year-over-year decline in the first quarter. This improvement had been anticipated due to the launch of four new convertible top platforms in the last six months. End-market diversity is a critical part of the Actuant strategy - we continue to generate increased sales and earnings in total, despite headwinds in a few markets." Actuant's operating profit in the second quarter of fiscal 2006 was $34.9 million, or 30% higher than the $26.9 million in the comparable prior year period. Operating profit margin increased 120 basis points from 11.4% in the second quarter of last year to 12.6% in the current year. This increase was driven by higher production volumes, favorable sales mix, and continued efforts across all businesses to drive LEAD (Lean Enterprise Across Disciplines) initiatives, including low cost country sourcing. Second quarter fiscal 2006 sales for the Tools & Supplies segment increased approximately 26% to $174.6 million, compared to $138.5 million in the previous year. Excluding the impact of foreign currency rate changes, year-over-year second quarter Tools & Supplies segment core sales increased 11% and sales excluding acquisitions increased 14%. Second quarter fiscal 2006 Engineered Solutions segment sales increased approximately 5% to $101.4 million, compared to $96.7 million in the previous year. Excluding the impact of foreign currency rate changes, second quarter Engineered Solutions core sales and sales excluding acquisitions both decreased 1%, the result of lower sales to the recreational vehicle market due to weak consumer demand. Total debt at February 28, 2006 was approximately $428 million. Net debt (total debt less approximately $11 million of cash) was $417 million, compared to $418 million at the beginning of the quarter. Excluding the approximate $9 million of cash used for acquisition related activities and a $2 million decline in accounts receivable securitization, Actuant generated approximately $12 million of cash flow in the second quarter, which is a seasonally weak cash-flow period. The Company had availability under its revolving credit facility of $225 million at February 28, 2006. The Company also announced sales and earnings guidance for the third quarter and full year of fiscal 2006. Arzbaecher stated, "We expect third quarter sales and EPS to increase as compared to the first two quarters due to normal seasonality as well as accelerating automotive convertible top sales. We are projecting third quarter sales and EPS to be in the range of $300 - $310 million and $0.73 - $0.78 per share, respectively. We are raising the lower end of our full year fiscal 2006 sales and EPS ranges, resulting in updated guidance of $1.155 - $1.175 billion and $2.80 - $3.00 per share, respectively." 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 of geopolitical activity on the economy, continued market acceptance of the Company's new product introductions, the successful integration of 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. An investor conference call is scheduled for 11am ET today, March 22, and may be listened to via web cast on Actuant's website at www.actuant.com. About Actuant Actuant, headquartered in Glendale, Wisconsin, is a diversified industrial company with operations in more than 30 countries. The Actuant businesses are market leaders in highly engineered position and motion control systems and branded hydraulic and electrical tools and supplies. Since its creation through a spin-off in 2000, Actuant has grown its sales from $482 million to over $1 billion and its market capitalization from $113 million to over $1.5 billion. The company employs a workforce of approximately 6,000 worldwide. Actuant Corporation trades on the NYSE under the symbol ATU. For further information on Actuant and its business units, visit the Company's website at www.actuant.com. (tables follow) Actuant Corporation Condensed Consolidated Balance Sheets (Dollars in thousands) February 28, August 31, 2006 2005 ------------- ------------- (Unaudited) ASSETS Current assets Cash and cash equivalents $10,979 $10,356 Accounts receivable, net 147,657 131,185 Inventories, net 141,543 135,960 Deferred income taxes 14,803 14,974 Other current assets 7,957 6,838 ------------- ------------- Total current assets 322,939 299,313 Property, plant and equipment, net 83,652 83,879 Goodwill 431,149 428,285 Other intangible assets, net 168,763 175,001 Other long-term assets 11,831 9,857 ------------- ------------- Total assets $1,018,334 $996,335 ============= ============= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Short-term borrowings $2,532 $21 Trade accounts payable 90,812 89,506 Accrued compensation and benefits 31,483 32,663 Income taxes payable 16,645 15,049 Current maturities of long-term debt 131 136 Other current liabilities 45,596 51,360 ------------- ------------- Total current liabilities 187,199 188,735 Long-term debt, less current maturities 425,031 442,661 Deferred income taxes 59,982 58,783 Pension and postretirement benefit accruals 40,795 41,192 Other long-term liabilities 18,310 20,131 Shareholders' equity Capital stock 5,436 5,410 Additional paid-in capital (364,259) (370,875) Accumulated other comprehensive income (loss) (25,022) (20,282) Restricted stock awards (1,736) (1,452) Stock held in trust (1,362) (1,166) Deferred compensation liability 1,362 1,166 Retained earnings 672,598 632,032 ------------- ------------- Total shareholders' equity 287,017 244,833 ------------- ------------- Total liabilities and shareholders' equity $1,018,334 $996,335 ============= ============= Actuant Corporation Condensed Consolidated Statements of Earnings (Dollars in thousands except per share amounts) Three Months Ended Six Months Ended February 28, February 28, -------------------- -------------------- 2006 2005 2006 2005 -------------------- -------------------- (Unaudited) (Unaudited) Net sales $276,019 $235,267 $559,895 $434,944 Cost of products sold 184,958 160,877 369,356 296,753 -------------------- -------------------- Gross profit 91,061 74,390 190,539 138,191 Selling, administrative and engineering expenses 54,433 46,177 113,915 82,977 Amortization of intangible assets 1,774 1,275 3,559 1,866 -------------------- -------------------- Operating profit 34,854 26,938 73,065 53,348 Financing costs, net 6,084 3,907 12,151 5,845 Other (income) expense, net 325 40 1,023 (1,179) -------------------- -------------------- Earnings from operations before income tax expense and minority interest 28,445 22,991 59,891 48,682 Income tax expense 9,159 8,022 19,379 16,828 Minority interest, net of income taxes (12) (229) (54) (285) -------------------- -------------------- Net earnings $19,298 $15,198 $40,566 $32,139 ==================== ==================== Earnings per share Basic $0.71 $0.58 $1.50 $1.29 Diluted 0.63 0.52 1.33 1.13 Weighted average common shares outstanding Basic 27,084 26,103 27,060 25,003 Diluted 31,568 30,642 31,539 29,516 Actuant Corporation Condensed Consolidated Statements of Cash Flows (Dollars in thousands) Three Months Ended Six Months Ended February 28, February 28, --------------------- --------------------- 2006 2005 2006 2005 ---------- ---------- ---------- ---------- (Unaudited) (Unaudited) Operating Activities Net earnings $19,298 $15,198 $40,566 $32,139 Adjustments to reconcile net earnings to net cash used in operating activities: Depreciation and amortization 6,721 5,699 13,242 9,797 Amortization of debt discount and debt issuance costs 361 332 721 577 Stock-based compensation expense 1,103 1,025 2,172 1,940 Provision for deferred income taxes 446 (1,036) 503 (791) Gain on disposal of assets 136 (117) 70 (296) Changes in operating assets and liabilities, excluding the effects of the business acquisition: Accounts receivable 4,531 3,790 (16,651) (7,244) (Decrease) increase in accounts receivable securitization program (2,294) 19,280 442 19,280 Inventories 432 (4,711) (5,313) (10,038) Prepaid expenses and other assets (46) (1,049) (1,230) 2,736 Trade accounts payable (4,194) (2,362) 2,513 (4,302) Income taxes payable (3,843) 645 1,650 2,472 Reimbursement of tax refund to former subsidiary - - - (15,837) Other accrued liabilities (8,673) (3,053) (3,684) (6,494) ---------- ---------- ---------- ---------- Net cash from operating activities 13,978 33,641 35,001 23,939 Investing Activities Proceeds from sale of property, plant and equipment - 2,482 115 2,839 Capital expenditures (4,824) (4,764) (9,899) (7,947) Cash paid for business acquisitions, net of cash acquired (9,337) (278,195) (9,337) (287,147) ---------- ---------- ---------- ---------- Net cash used in investing activities (14,161) (280,477) (19,121) (292,255) Financing Activities Net borrowings (repayments) on revolving credit facilities and short-term borrowings 2,018 (53,769) (15,085) (36,144) Proceeds from issuance of term loans - 250,000 - 250,000 Principal payments on term loans - (2,127) - (2,218) Retirement of KCI 10.5% Bonds - (82,800) - (82,800) Debt issuance costs - (2,300) - (2,300) Net proceeds from Class A common stock offering - 134,360 - 134,360 Cash dividend - - (2,165) - Tax benefit from stock- based compensation 472 165 660 3,548 Stock option exercises and other 1,049 323 1,477 1,556 ---------- ---------- ---------- ---------- Net cash provided by (used in) financing activities 3,539 243,852 (15,113) 266,002 Effect of exchange rate changes on cash 153 (35) (144) 350 ---------- ---------- ---------- ---------- Net increase (decrease) in cash and cash equivalents 3,509 (3,019) 623 (1,964) Cash and cash equivalents - beginning of period 7,470 7,088 10,356 6,033 ---------- ---------- ---------- ---------- Cash and cash equivalents - end of period $10,979 $4,069 $10,979 $4,069 ========== ========== ========== ========== ACTUANT CORPORATION SUPPLEMENTAL UNAUDITED DATA (Dollars in thousands) FISCAL 2005 --------------------------------------------- Q1 Q2 Q3 Q4 TOTAL --------------------------------------------- SALES TOOLS & SUPPLIES SEGMENT $112,537 $138,546 $158,211 $174,250 $583,544 ENGINEERED SOLUTIONS SEGMENT 87,140 96,721 113,522 95,139 392,522 --------------------------------------------- TOTAL $199,677 $235,267 $271,733 $269,389 $976,066 ============================================= % SALES GROWTH TOOLS & SUPPLIES SEGMENT 16.8% 33.8% 43.9% 63.9% 40.2% ENGINEERED SOLUTIONS SEGMENT 24.0% 33.5% 31.2% 16.8% 26.3% TOTAL 19.9% 33.7% 38.3% 43.5% 34.3% OPERATING PROFIT TOOLS & SUPPLIES SEGMENT $17,493 $19,621 $21,924 $28,537 $87,575 ENGINEERED SOLUTIONS SEGMENT 12,080 10,803 16,091 10,792 49,766 CORPORATE / GENERAL (3,163) (3,486) (4,137) (4,064) (14,850) --------------------------------------------- TOTAL $26,410 $26,938 $33,878 $35,265 $122,491 ============================================= OPERATING PROFIT % TOOLS & SUPPLIES SEGMENT 15.5% 14.2% 13.9% 16.4% 15.0% ENGINEERED SOLUTIONS SEGMENT 13.9% 11.2% 14.2% 11.3% 12.7% TOTAL (INCLUDING CORPORATE) 13.2% 11.4% 12.5% 13.1% 12.5% EBITDA TOOLS & SUPPLIES SEGMENT $19,262 $22,560 $25,619 $31,877 $99,318 ENGINEERED SOLUTIONS SEGMENT 13,384 13,345 18,143 13,150 58,022 CORPORATE / GENERAL (919) (3,308) (3,871) (4,186) (12,284) --------------------------------------------- TOTAL $31,727 $32,597 $39,891 $40,841 $145,056 ============================================= EBITDA % TOOLS & SUPPLIES SEGMENT 17.1% 16.3% 16.2% 18.3% 17.0% ENGINEERED SOLUTIONS SEGMENT 15.4% 13.8% 16.0% 13.8% 14.8% TOTAL (INCLUDING CORPORATE) 15.9% 13.9% 14.7% 15.2% 14.9% FISCAL 2006 --------------------------------------------- Q1 Q2 Q3 Q4 TOTAL --------------------------------------------- SALES TOOLS & SUPPLIES SEGMENT $181,306 $174,577 $355,883 ENGINEERED SOLUTIONS SEGMENT 102,570 101,442 204,012 --------------------------------------------- TOTAL $283,876 $276,019 $- $- $559,895 ============================================= % SALES GROWTH TOOLS & SUPPLIES SEGMENT 61.1% 26.0% 41.7% ENGINEERED SOLUTIONS SEGMENT 17.7% 4.9% 11.0% TOTAL 42.2% 17.3% 28.7% OPERATING PROFIT TOOLS & SUPPLIES SEGMENT $30,416 $27,355 $57,771 ENGINEERED SOLUTIONS SEGMENT 11,762 11,131 22,893 CORPORATE / GENERAL (3,967) (3,632) (7,599) --------------------------------------------- TOTAL $38,211 $34,854 $- $- $73,065 ============================================= OPERATING PROFIT % TOOLS & SUPPLIES SEGMENT 16.8% 15.7% 16.2% ENGINEERED SOLUTIONS SEGMENT 11.5% 11.0% 11.2% TOTAL (INCLUDING CORPORATE) 13.5% 12.6% 13.0% EBITDA TOOLS & SUPPLIES SEGMENT $33,530 $30,868 $64,398 ENGINEERED SOLUTIONS SEGMENT 14,105 13,968 28,073 CORPORATE / GENERAL (3,601) (3,586) (7,187) --------------------------------------------- TOTAL $44,034 $41,250 $- $- $85,284 ============================================= EBITDA % TOOLS & SUPPLIES SEGMENT 18.5% 17.7% 18.1% ENGINEERED SOLUTIONS SEGMENT 13.8% 13.8% 13.8% TOTAL (INCLUDING CORPORATE) 15.5% 14.9% 15.2% ACTUANT CORPORATION Reconciliation of GAAP measures to non-GAAP measures (Dollars in thousands) FISCAL 2005 ----------------------------------------- Q1 Q2 Q3 Q4 TOTAL ----------------------------------------- EBITDA (1) NET EARNINGS $16,941 $15,198 $19,997 $19,115 $71,251 FINANCING COSTS, NET 1,938 3,907 4,936 6,146 16,927 INCOME TAX EXPENSE 8,806 8,022 8,744 9,440 35,012 DEPRECIATION & AMORTIZATION 4,098 5,699 6,448 6,176 22,421 MINORITY INTEREST, NET OF INCOME TAX (56) (229) (234) (36) (555) ----------------------------------------- EBITDA (NON-GAAP MEASURE) $31,727 $32,597 $39,891 $40,841 $145,056 ========================================= FISCAL 2006 ----------------------------------------- Q1 Q2 Q3 Q4 TOTAL ----------------------------------------- EBITDA (1) NET EARNINGS $21,268 19,298 $40,566 FINANCING COSTS, NET 6,067 6,084 12,151 INCOME TAX EXPENSE 10,220 9,159 19,379 DEPRECIATION & AMORTIZATION 6,521 6,721 13,242 MINORITY INTEREST, NET OF INCOME TAX (42) (12) (54) ----------------------------------------- EBITDA (NON-GAAP MEASURE) $44,034 $41,250 $- $- $85,284 ========================================= (1) EBITDA represents net earnings before financing costs,net, income tax expense, depreciation & amortization and minority interest. EBITDA is not a calculation based upon generally accepted accounting principles (GAAP). The amounts included in the EBITDA calculation, however, are derived from amounts included in the Consolidated Statements of Earnings data. EBITDA should not be considered as an alternative to net earnings or operating profit as an indicator of the company's operating performance, or as an alternative to operating cash flows as a measure of liquidity. Actuant has presented EBITDA because it regularly reviews this as a measure of the company's ability to incur and service debt. In addition, EBITDA is used by many of our investors and lenders, and is presented as a convenience to them. However, the EBITDA measure presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation. CONTACT: Actuant Corporation Andrew Lampereur, 414-352-4160