EMERSON ELECTRIC CO - Annual Report: 2010 (Form 10-K)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
x ANNUAL REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE
ACT OF 1934
For
the fiscal year ended September 30, 2010
OR
¨ 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 1-278
EMERSON
ELECTRIC CO.
(Exact
name of registrant as specified in its charter)
|
Missouri
(State
or other jurisdiction of
incorporation
or organization)
|
43-0259330
(I.R.S.
Employer
Identification
No.)
|
|
|
8000
W. Florissant Ave.
P.O.
Box 4100
St.
Louis, Missouri
(Address
of principal executive offices)
|
63136
(Zip
Code)
|
Registrant's
telephone number, including area code: (314) 553-2000
Securities
registered pursuant to Section 12(b) of the Act:
|
Title of each class
|
Name of each exchange on
which registered
|
|
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Common
Stock of $0.50 par value per share
|
New
York Stock Exchange
Chicago
Stock Exchange
|
Securities
registered pursuant to Section 12(g) of the Act: None
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes x No
¨
Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes ¨ No x
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 (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes x No
¨
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files) Yes x No
¨
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. x
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
|
Large
accelerated filer x
|
Accelerated
filer ¨
|
|
Non-accelerated
filer ¨ (Do
not check if a smaller reporting company)
|
Smaller
reporting company ¨
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act).
Yes ¨ No x
Aggregate
market value of the voting stock held by nonaffiliates of the registrant as of
close of business on March 31, 2010: $37.8 billion.
Common
stock outstanding at October 31, 2010: 752,657,107
shares.
Documents
Incorporated by Reference
|
1.
|
Portions
of Emerson Electric Co. 2010 Annual Report to Stockholders (Parts I and
II).
|
|
2.
|
Portions
of Emerson Electric Co. Notice of 2011 Annual Meeting of Stockholders and
Proxy Statement (Part III).
|
2
PART
I
Item
1. Business
Emerson
was incorporated in Missouri in 1890, and has grown from a regional manufacturer
of electric motors and fans into a diversified global technology company. Having
expanded its product lines through internal growth and acquisitions, Emerson
today is designing and supplying product technology and delivering engineering
services and solutions in a wide range of industrial, commercial and consumer
markets around the world.
Emerson
is organized into the following business segments, based on the nature of the
products and services rendered:
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·
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Process
Management - providing measurement, control and diagnostic
capabilities for automated industrial processes producing items such as
foods, fuels, medicines and power.
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·
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Industrial
Automation - bringing integrated manufacturing solutions to diverse
industries worldwide.
|
|
|
·
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Network Power -
providing power conditioning and reliability and environmental control to
help keep telecommunication systems, data networks and other critical
business applications continuously
operating.
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·
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Climate
Technologies - enhancing household and commercial comfort as well
as food safety and energy efficiency through air conditioning and
refrigeration technology.
|
|
|
·
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Tools and
Storage - providing tools for professionals and homeowners, home
and commercial storage systems, and appliance
solutions.
|
Sales,
earnings before interest and income taxes, and total assets attributable to each
segment for the three years ended September 30, 2010, are set forth in Note 16
of Notes to Consolidated Financial Statements of the 2010 Annual Report, which
note is hereby incorporated by reference. Sales by segment in 2010 were Process
Management 28 percent, Industrial Automation 20 percent, Network Power 27
percent, Climate Technologies 17 percent, and Tools and Storage 8 percent. Sales
by geographic destination in 2010 were United States 43 percent, Europe 21
percent, Asia 23 percent and other regions 13 percent. Information with respect
to acquisition and divestiture activities and rationalization of operations by
Emerson is set forth in Notes 3 and 5 of Notes to Consolidated Financial
Statements of the 2010 Annual Report, which notes are hereby incorporated by
reference.
PROCESS
MANAGEMENT
The
Process Management segment offers customers product technology as well as
engineering and project management services for precision control, monitoring
and asset optimization of oil and gas reservoirs and plants that produce power
or that process or treat such items as oil, natural gas and petrochemicals; food
and beverages; pulp and paper; pharmaceuticals; and municipal water supplies.
This array of products and services helps customers optimize their plant
capabilities in the areas of plant safety and reliability, and product quality
and output. In 2010, sales by geographic destination for this segment were
United States 33 percent, Europe 23 percent, Asia 23 percent and other regions
21 percent.
Process
Management Systems and Software
Process
Management systems and software control plant processes by collecting and
analyzing information from measurement devices in the plant, and then using that
information to adjust valves, pumps, motors, drives and other control hardware
for maximum product quality and process efficiency. Software capabilities also
include upstream oil and gas reservoir simulation and modeling for
production
3
optimization.
Emerson’s process control systems can be extended wirelessly to support a mobile
workforce with handheld tools/communicators, provide site-wide location tracking
of people and assets, enable video monitoring and communicate with wireless
field devices, thereby increasing the information available to
operators.
Measurement
and Analytical Instrumentation
Measurement
instrumentation measures the physical properties of liquids or gases in a
process stream, such as pressure, temperature, level, or rate and amount of
flow, and communicates this information to the control system. Measurement
technologies provided by Emerson include Coriolis direct mass flow, magnetic
flow, vortex flow, ultrasonic flow, differential pressure, ultralow-flow fluid
measurement, temperature sensors and radar-based tank gauging. Emerson
measurement products are also often used in custody transfer applications, such
as the transfer of gasoline from a storage tank to a tanker truck, where precise
metering of the amount of fluid transferred helps ensure accurate asset
management. Complementary products include onshore and subsea multi-phase
meters, wetgas meters, downhole gauges and corrosion/erosion
instruments.
Analytical
instrumentation analyzes the chemical composition of process fluids and
emissions to enhance quality and efficiency, as well as environmental
compliance. Emerson’s analytical technologies include process gas
chromatographs, in-situ oxygen analyzers, infrared gas and process fluid
analyzers, combustion analyzers and systems, and analyzers that measure pH,
conductivity and water quality.
Emerson
also provides these same technologies with wireless communication capability.
This allows customers to monitor processes or equipment that were previously not
measurable (remote, moving/rotating) or not economical to measure due to the
cost and difficulty of running wires in industrial process plants.
Valves,
Actuators and Regulators
Control
valves respond to commands from the control system by continuously and precisely
modulating the flow of process fluids to provide maximum process efficiency and
product quality. Emerson provides sliding stem valves, rotary valves, butterfly
valves and related valve actuators and controllers. Emerson also provides a line
of industrial and residential regulators, whose function is to reduce the
pressure of fluids such as liquid natural gas and liquid petroleum gas for
transfer from high-pressure supply lines to lower pressure systems.
PlantWeb® Digital
Plant Architecture
Emerson’s
PlantWeb digital
plant architecture combines the technologies described above with the advantages
of “intelligent” plant devices (valves and measurement instruments that have
advanced diagnostic capabilities), open communication standards (non-proprietary
wired and wireless digital protocols allowing the plant devices and the control
system to “talk” with one another) and integrated modular software, not only to
better control the process but also to collect and analyze valuable information
about plant assets and processes. This capability gives customers the ability to
detect or predict changes in equipment and process performance and the impact
they can have on plant operations. The PlantWeb architecture
provides the insight to improve plant availability and safety, and also
furnishes a platform to continually improve asset management and standards
compliance, and to reduce startup, operations and maintenance
costs.
Industry
Services and Solutions
Emerson’s
array of process automation and asset optimization services can improve
automation project implementation time and costs, increase process availability
and productivity, and reduce total cost of ownership. Global industry centers
offer engineering and project management services to help customers extract
maximum performance and reliability from their process equipment and automation
assets. These centers serve industries such as oil and gas, pulp and paper,
chemical, power, food and beverage, and life sciences. They also assist
customers in diagnosing equipment problems and plant
inefficiencies.
4
Distribution
The
principal worldwide distribution channel for the Process Management segment is a
direct sales force, although a network of independent sales representatives, and
to a lesser extent, independent distributors purchasing these products for
resale are also utilized. The majority of sales in the United States are made
through a direct sales force with the remainder primarily through independent
sales representatives. In Europe and Asia, sales are almost exclusively made
through a direct sales force with the remainder split evenly between independent
sales representatives and distributors.
Brands
Service/trademarks
and trade names within the Process Management segment include Emerson Process
Management, AMS Suite, Baumann, Bettis, Bristol, CSI, Damcos, Daniel, DeltaV,
EIM, El-O-Matic, Enable, Epro, Fisher, Go Switch, Guardian, Micro Motion,
Ovation, PlantWeb, RMS, ROC, Rosemount, Roxar, Smart Process, SureService,
Tescom, TopWorx and Valvetop.
INDUSTRIAL
AUTOMATION
The
Industrial Automation segment provides integrated manufacturing solutions to our
customers at the source of manufacturing their own products. Products include
motors, power transmission solutions, alternators, fluid controls and materials
joining equipment. Through these offerings, Emerson brings technology and
enhanced quality to the customer’s final product. In 2010, sales by geographic
destination for this segment were United States 37 percent, Europe 38 percent,
Asia 16 percent and other regions 9 percent.
Motors
and Drives
Emerson
provides a broad line of drives and electric motors that are used in a wide
variety of manufacturing operations and products, including production assembly
lines, escalators in shopping malls and supermarket checkout stations. Products
in this category include alternating current (AC) and direct current (DC)
electrical variable speed drives, servo motors, pump motors, drive control
systems, integral horsepower motors (1 HP and above), fractional horsepower
motors (less than 1 HP), hermetic motors and gear drives.
Power
Transmission
Emerson’s
power transmission products include belt and chain drives, helical and worm
gearing, gear motors, motor sheaves, pulleys, mounted and unmounted bearings,
couplings, chains and sprockets. They are used to transmit power mechanically in
a wide range of manufacturing and material handling operations and products. Our
design and application experience enable us to provide both standard and
customized automation and power transmission solutions to our
customers.
Power
Generation
Emerson
provides alternators (low, medium and high voltage) for use in diesel or gas
powered generator sets, as well as high frequency alternators, AC
motor/generator sets, traction generators, wind power generators, wind turbine
pitch control systems and solar photovoltaic converters.
Fluid
Power and Fluid Control
Products
in this category control and power the flow of fluids (liquids and gases) in
manufacturing operations such as automobile assembly, food processing, textile
manufacturing and petrochemical processing. They include solenoid and pneumatic
valves, valve position indicators, pneumatic cylinders, air preparation
equipment, and pressure, vacuum and temperature switches.
5
Materials
Joining and Precision Cleaning
Emerson
supplies both plastics joining technologies and equipment, and metal welding and
joining processes to a diversified manufacturing customer base, including
automotive, medical devices and toys. The Company also provides precision
cleaning and liquid processing solutions to industrial and commercial
manufacturers. Products include ultrasonic joining and cleaning equipment;
linear and orbital vibration welding equipment; systems for hot plate welding,
spin welding and laser welding; and aqueous, semi-aqueous and vapor cleaning
systems.
Electrical
Distribution
Emerson’s
majority-owned EGS Electrical Group joint venture with SPX Corporation
manufactures a broad line of components for current- and noncurrent-carrying
electrical distribution devices. These products include conduit and cable
fittings, plugs and receptacles, industrial lighting, and enclosures and
controls. Products in this category are used in hazardous, industrial,
commercial and construction environments, such as oil and gas drilling and
production sites, pulp and paper mills and petrochemical plants.
Distribution
On a
worldwide basis, the primary distribution channel for the Industrial Automation
segment is through direct sales forces. Most products sold worldwide to original
equipment manufacturers are through a direct sales force. Independent
distributors constitute the next significant sales channel, mostly to reach end
users. To a lesser extent, independent sales representatives are utilized,
particularly for electrical distribution products in the United
States.
Brands
Service/trademarks
and trade names within the Industrial Automation segment include Emerson
Industrial Automation, Appleton, ASCO, ASCO Joucomatic, ASCO Numatics, Branson
Ultrasonics, Browning, Control Techniques, Emerson Power Transmission, Kato
Engineering, Kop-Flex, Leroy Somer, McGill, Morse, O-Z/Gedney, SSB Wind Systems,
System Plast and Trident.
NETWORK
POWER
Emerson’s
Network Power segment designs, manufactures, installs and maintains products
providing “grid to chip” electric power conditioning, power reliability and
environmental control for telecommunications networks, data centers and other
critical applications, and also provides comprehensive data center
infrastructure management solutions. Products in this segment include
uninterruptible power systems, embedded power supplies, precision cooling and
inbound power systems, integrated data center monitoring and control devices and
software, plus 24-hour service. In 2010, sales by geographic destination for
this segment were United States 40 percent, Europe 16 percent, Asia 34 percent
and other regions 10 percent.
Power
Systems
Emerson
supplies uninterruptible AC and DC power systems, which provide reliable,
conditioned power to telecommunication networks, data centers and other critical
equipment in the event of a blackout or line surges and spikes. Power Systems’
products range from stand-alone units to complete systems incorporating
rectifiers, distribution units, surge protection, batteries and system
supervision.
Embedded
Power
Embedded
power supplies are installed by original equipment manufacturers to convert or
condition power for microprocessors and peripherals in a wide range of
telecommunication, health care, computer and industrial applications using
standard or custom AC/DC or DC/DC designs. They are also used in consumer
products for chargers and power adaptors.
6
Embedded
Computing
Embedded
Computing designs and develops embedded computer systems for original equipment
manufacturers and systems integrators serving telecommunications, defense,
aerospace, medical and industrial automation end markets. Products range from
communication platforms, blades and modules to enabling software and
professional services.
Precision
Cooling
Emerson’s
precision cooling products provide temperature and humidity control for
computers, telecommunications and other sensitive equipment. These products
range from 14,000 to 4 million BTUs in capacity and are available in up-flow,
down-flow and overhead configurations.
Inbound
Power Systems
Emerson
inbound power technology provides reliable power systems which automatically
transfer critical application loads from a utility to emergency backup
generators in the event of a blackout or brownout. Products include automatic
transfer switches, paralleling and synchronizing gear and related distribution
equipment and control systems.
Data
Center Infrastructure Management
Emerson
provides comprehensive data center management solutions through server access
technologies that enable access, monitoring and control of the information
technology infrastructure and provide linkage with data center
operations.
Connectivity
Solutions
Emerson’s
connectivity products serve the needs of the wireless communications, telephone
and data network, CATV, defense, security systems and health care industries and
other industrial customers globally with a broad range of radio frequency,
microwave and fiber optic interconnect components and assemblies.
Service
and Site Operations
Emerson
staffs Energy Operation Centers in more than 30 countries, and deploys field
service personnel worldwide to assist customers in managing their network
support systems. Our services include on-site operations management, energy
consumption monitoring, preventive maintenance, electrical testing, remote
monitoring and management and 24-hour service capability.
Distribution
The
Network Power segment sells primarily through worldwide direct sales forces,
particularly in Europe and Asia. The remainder of sales is handled by
independent sales representatives, particularly in the United States, and
independent distributors.
Brands
Service/trademarks
and trade names within the Network Power segment include Emerson Network Power,
Aperture, Artesyn, ASCO Power Technologies, Astec, Avocent, Chloride, Knürr,
Liebert, Liebert Services, Netspan, Netsure, Semflex, Stratos and
Trompeter.
7
CLIMATE
TECHNOLOGIES
The
Climate Technologies segment provides products and services for all areas of the
climate control industry, including residential, commercial and industrial
heating and air conditioning, and commercial and industrial refrigeration. Our
technology enables homeowners and businesses to better manage their heating, air
conditioning and refrigeration systems for improved control and lower energy
bills. This segment also provides services that digitally control and remotely
monitor refrigeration units in grocery stores and other food distribution
outlets to enhance freshness and food safety. In 2010, sales by geographic
destination for this segment were United States 54 percent, Europe 13 percent,
Asia 23 percent and other regions 10 percent.
Residential
and Commercial Heating and Air Conditioning
Emerson
provides a full range of heating and air conditioning products that help reduce
operational and energy costs and create comfortable environments in all types of
buildings. These products include reciprocating and scroll air conditioning
compressors, including an ultra-efficient residential scroll compressor with two
stages of cooling capacity; standard and programmable thermostats; monitoring
equipment and electronic controls for gas and electric heating systems; gas
valves for furnaces and water heaters; nitride ignition systems for furnaces;
sensors and thermistors for home appliances; and temperature sensors and
controls.
Commercial
and Industrial Refrigeration
Emerson’s
technology is incorporated into equipment to refrigerate food and beverages in
supermarkets, convenience stores, food service operations and refrigerated
trucks and transport containers. Our refrigeration products are also used in a
wide variety of industrial applications, including medical applications, food
processing and cold storage. These products include reciprocating, scroll and
screw compressors; precision flow controls; system diagnostics and controls that
provide precise temperature management; and environmental control
systems.
Services
and Solutions
Emerson
services and solutions enable global customers to optimize the performance of
facilities including large-scale retailers, supermarkets, convenience stores and
food services facilities. By providing expertise in air conditioning,
refrigeration and lighting control, Emerson performs as a complete facility
manager for its customers. The Company’s expertise allows customers to reduce
energy and maintenance costs, thereby improving overall facility uptime. In
addition to industry-leading controls, products include facility design and
project management, commissioning services, facility monitoring services and
energy modeling and consultancy.
Distribution
Climate
Technologies segment sales, primarily to original equipment manufacturers and
end users, are made predominately through worldwide direct sales force networks.
The remaining sales are primarily through independent distributor networks
throughout the world.
Brands
Service/trademarks
and trade names within the Climate Technologies segment include Emerson Climate
Technologies, Clive Samuels & Associates, Computer Process Controls,
Copeland, Design Services Network, Dixell, Emerson Climate Technologies
Distribution Services, Emerson Climate Technologies Educational Services,
Emerson Retail Services, Fusite, Therm-O-Disc, Vilter and
White-Rodgers.
8
TOOLS
AND STORAGE
Emerson’s
Tools and Storage segment (formerly Appliance and Tools; renamed subsequent to
the Company’s sale of its appliance motors and U.S. commercial and industrial
motors businesses) includes a broad range of tools, storage products and
appliance solutions. In 2010, sales by geographic destination for this segment
were United States 80 percent, Europe 7 percent, Asia 4 percent and other
regions 9 percent.
Professional
and Do-It-Yourself Tools
Our
pipe-working tools are used by plumbing and mechanical professionals to install
and repair piping systems. These tools include pipe wrenches, pipe cutters, pipe
threading and roll grooving equipment; a time-saving system that joins tubing
through mechanical crimping; drain cleaners; diagnostic systems including
closed-circuit television pipe inspection and locating equipment; and tubing
tools. Other professional tools include water jetters, wet-dry vacuums,
commercial vacuums, rolling storage boxes, truck work boxes, bolt cutters, and
van and truck ladder racks. Do-it-yourself tools, available at home improvement
retail outlets, include drain cleaning equipment, pipe and tube working tools,
and wet-dry vacuums.
Storage
Solutions
Emerson
provides a wide variety of freestanding, fixed and mobile storage products for
residential, commercial, health care and food service applications. Our products
for the home include wall-mounted and freestanding shelving systems, cabinet and
closet organizers, home office storage, and drawer systems and containers,
available in wire, stainless steel and laminate. Our storage solutions also help
commercial customers utilize space in the most efficient manner. These solutions
include storage and display shelving, stock-picking and kitting carts, cabinets,
totes, bins, workstations, and merchandising and inventory storage racks.
Products provided to the health care industry assist in medical response and
treatment; they include emergency and operating room carts, medication carts,
polymer and wire shelving systems, and sterile worktables. Our food service
equipment helps meet the storage needs of the food service and hospitality
industries, such as restaurants and hotels. This equipment includes polymer and
wire storage systems, busing carts, pan and tray racks, transport carts and
workstations.
Appliances
and Components
Emerson
provides a number of appliance solutions, including residential and commercial
food waste disposers, ceiling fans, instant hot water dispensers and compact
electric water heaters.
Distribution
The
principal worldwide distribution channels for the Tools and Storage segment are
distributors and direct sales forces. Professional tools are sold almost
exclusively worldwide through distributors. Independent sales representatives
are utilized to a lesser extent, particularly for storage solutions. Appliance
solutions are sold almost exclusively through direct sales force
networks.
Brands
Service/trademarks
and trade names within the Tools and Storage segment include Emerson, Emerson
Appliance Solutions, Emerson Professional Tools, Emerson Storage Solutions,
ClosetMaid, Flo Healthcare, InSinkErator, Knaack, Lionville, MedDispense, METRO,
ProTeam, RIDGID and Weather Guard.
9
PRODUCTION
Emerson
utilizes various production operations and methods. The principal production
operations are metal stamping, forming, casting, machining, welding, plating,
heat treating, painting and assembly. In addition, Emerson uses specialized
production operations, including automatic and semiautomatic testing, automated
material handling and storage, ferrous and nonferrous machining and special
furnaces for heat treating and foundry applications. Management believes the
equipment, machinery and tooling used in these processes are of modern design
and well maintained.
RAW
MATERIALS
Emerson's
major requirements for basic raw materials include steel, copper, cast iron,
electronics, aluminum and brass, and to a lesser extent, plastics and other
petroleum-based chemicals. Emerson has multiple sources of supply for each of
its major requirements and is not significantly dependent on any one or a few
suppliers. Although recent high prices for some raw materials have caused
pricing pressures for some of our businesses, the raw materials and various
purchased components required for the Company’s products have generally been
available in sufficient quantities.
PATENTS,
TRADEMARKS AND LICENSES
The
Company has many patents, trademarks and licenses obtained over a number of
years which expire at various dates in the future. While proprietary
intellectual property is important to the Company, management believes the loss
of any intellectual property right would not materially impact the Company or
any of its segments.
BACKLOG
The
Company’s estimated consolidated order backlog was $5,616 million and $4,615
million at September 30, 2010 and 2009, respectively. Nearly the entire
September 30, 2010 consolidated backlog amount is expected to be shipped within
one year. The estimated backlog by business segment at September 30, 2010 and
2009 follows (dollars in millions):
|
2009
|
2010
|
|||||||
|
Process
Management
|
$ | 2,609 | 2,868 | |||||
|
Industrial
Automation
|
385 | 619 | ||||||
|
Network
Power
|
1,066 | 1,641 | ||||||
|
Climate
Technologies
|
373 | 395 | ||||||
|
Tools
and Storage
|
182 | 93 | ||||||
|
Total
Backlog
|
$ | 4,615 | 5,616 | |||||
10
COMPETITION
Emerson's
businesses operate in markets that are highly competitive and the Company
competes based on product performance, quality, service and/or price across the
industries and markets served. A significant element of the Company's
competitive strategy is to deliver solutions to our customers by manufacturing
high quality products at the best relevant global cost. Although no single
company competes directly with Emerson in all of the Company's product lines,
various companies compete in one or more product lines and the number of
competitors varies by product line. Some competitors have substantially greater
sales and assets than Emerson and the Company also competes with many smaller
companies. Management believes Emerson has a market leadership position in many
of its product lines.
RESEARCH
AND DEVELOPMENT
Costs
associated with Company-sponsored research and development activities were $473
million, $460 million and $458 million in 2010, 2009 and 2008,
respectively.
ENVIRONMENT
The
Company's manufacturing locations generate waste, the treatment, storage,
transportation and disposal of which are subject to federal, state, foreign
and/or local laws and regulations relating to the protection of the environment.
Compliance with laws regulating the discharge of materials into the environment
or otherwise relating to the protection of the environment has not had a
material effect upon Emerson's capital expenditures, earnings or competitive
position. The Company does not anticipate having material capital expenditures
for environmental control facilities during the next fiscal year.
EMPLOYEES
Emerson
and its subsidiaries had an average of approximately 127,700 employees during
2010. Management believes that the Company's employee relations are favorable.
Some of the Company's employees are represented under collective bargaining
agreements, but none of these agreements is considered significant. See Note 5
of Notes to Consolidated Financial Statements of the 2010 Annual Report, which
note is hereby incorporated by reference, for further information.
DOMESTIC
AND FOREIGN OPERATIONS
International
sales were $11,938 million in 2010, $11,416 million in 2009 and $13,307 million
in 2008, including U.S. exports of $1,317 million, $1,211 million and $1,449
million in 2010, 2009 and 2008, respectively. Although there are additional
risks attendant to foreign operations, such as possible nationalization of
facilities, currency fluctuations and restrictions on the movement of funds,
Emerson's financial position has not been materially affected thereby to date.
See Note 16 of Notes to Consolidated Financial Statements of the 2010 Annual
Report, which note is hereby incorporated by reference, for further information
with respect to foreign operations.
INTERNET
ACCESS
Emerson's
Forms 10-K, 10-Q, 8-K and all amendments to those reports are available without
charge through Emerson's website on the Internet as soon as reasonably
practicable after they are electronically filed with, or furnished to, the U.S.
Securities and Exchange Commission (SEC). They may be accessed as follows:
www.Emerson.com, Investor Relations, SEC Filings. Information on Emerson’s
website does not constitute part of this Form 10-K.
The
information set forth under, “Item 1A. Risk Factors” is hereby
incorporated by reference.
11
Item
1A. Risk Factors
Investing
in our securities involves risks. We may amend or supplement the risk factors
described below from time to time by other reports we file with the SEC in the
future.
We
Operate In Businesses That Are Subject To Competitive Pressures That Could
Affect Prices or Demand for Our Products
Our
businesses operate in markets that are highly competitive, and we compete on the
basis of product performance, quality, service and/or price across the
industries and markets served. A significant element of our competitive strategy
is to deliver solutions to our customers by manufacturing high quality products
at the best relevant global cost. Some of our competitors have greater sales,
assets and financial resources than our Company. Competitive pressures could
adversely affect prices or customer demand for our products, impacting our
profit margins and/or resulting in a loss of market share.
Our
Operating Results Depend In Part on Continued Successful Research, Development
and Marketing of New and/Or Improved Products and Services, and There Can Be No
Assurance That We Will Continue To Successfully Introduce New Products and
Services
The
success of new and improved products and services depends on their initial and
continued acceptance by our customers. Our businesses are affected by varying
degrees of technological change and corresponding shifts in customer demand,
which result in unpredictable product transitions, shortened life cycles and
increased importance of being first to market with new products and services. We
may experience difficulties or delays in the research, development, production
and/or marketing of new products and services which may negatively impact our
operating results and prevent us from recouping or realizing a return on the
investments required to bring new products and services to market.
We
Engage In Acquisitions, And May Encounter Difficulties in Integrating These
Businesses and Therefore We May Not Realize the Anticipated Benefits Of the
Acquisitions
We are a
company that, from time to time, seeks to grow through strategic acquisitions.
In 2010 and in past years, we have made various acquisitions and entered into
joint venture arrangements intended to complement or expand our business, and
may continue to do so in the future (see Note 3 of Notes to Consolidated
Financial Statements of the 2010 Annual Report, which note is hereby
incorporated by reference). The success of these transactions will depend on our
ability to integrate assets and personnel acquired in these transactions and to
cooperate with our strategic partners. We may encounter difficulties in
integrating acquisitions with our operations, and in managing strategic
investments. Furthermore, we may not realize the degree, or timing, of benefits
we anticipate when we first enter into a transaction. Any of the foregoing could
adversely affect our business and results of operations.
Access
To Funding Through The Capital Markets Is Essential To The Execution Of Our
Business Plan And If We Are Unable To Maintain Such Access We Could Experience A
Material Adverse Effect On Our Business And Financial Results
Our
ability to invest in our businesses, make strategic acquisitions and refinance
maturing debt obligations requires access to the capital markets and sufficient
bank credit lines to support short-term borrowings. Volatility in the capital
markets may increase costs associated with issuing commercial paper or other
debt instruments, or affect the Company’s ability to access those markets. If we
are unable to continue to access the capital markets, we could experience a
material adverse effect on our business and financial results. If our customers,
suppliers and financial institutions are unable to access the capital markets to
meet their commitments to the Company, our business could be adversely
impacted.
12
We
Use a Variety of Raw Materials and Components in Our Businesses, and Significant
Shortages or Price Increases Could Increase Our Operating Costs and Adversely
Impact the Competitive Positions of Our Products
Our major
requirements for raw materials include steel, copper, cast iron, electronics,
aluminum and brass and, to a lesser extent, plastics and other petroleum-based
chemicals. Emerson has multiple sources of supply for each of its major
requirements and is not significantly dependent on any one or a few suppliers.
Significant shortages or price increases could impact the prices our affected
businesses charge, their operating costs and the competitive position of their
products and services, which could adversely affect our results of operations.
While we monitor market prices of the commodities we require and attempt to
reduce price exposure through hedging activities, this risk could adversely
affect our operating results.
Our
Operations Depend On Production Facilities Throughout The World, A Majority Of
Which Are Located Outside The United States And Subject To Increased Risks Of
Disrupted Production Causing Delays In Shipments And Loss Of Customers And
Revenue
We manage
businesses with manufacturing facilities worldwide, a majority of which are
located outside the United States. Emerging market sales now represent over
one-third of total sales and serving a global customer base requires that we
place more production in emerging markets to capitalize on market opportunities
and maintain our best-cost position. Our international production facilities and
operations could be disrupted by a natural disaster, labor strife, war,
political unrest, terrorist activity or public health concerns, particularly in
emerging countries that are not well-equipped to handle such
occurrences.
Our
manufacturing facilities abroad also may be more susceptible to changes in laws
and policies in host countries and economic and political upheaval than our
domestic facilities. Any such disruption could cause delays in shipments of
products and the loss of sales and customers, and insurance proceeds may not
adequately compensate us.
Our
Substantial Sales Abroad Subject Us to Economic Risk As Our Results of
Operations May Be Adversely Affected By Foreign Currency Fluctuations and
Changes in Local Government Regulations and Policies
We sell,
manufacture, engineer, and purchase products in overseas markets. A significant
portion of our sales is outside the United States, and we expect sales from
non-U.S. markets to continue to represent a significant portion of our total
sales. International sales and operations are subject to changes in local
government regulations and policies, including those related to tariffs and
trade barriers, investments, taxation, exchange controls, and repatriation of
earnings. Changes in the relative values of currencies occur from time to time
and have affected our operating results and could do so in the future. While we
monitor our exchange rate exposures and attempt to reduce this exposure through
hedging activities, this risk could adversely affect our operating
results.
Recessions,
Adverse Market Conditions or Downturns in the End Markets We Serve May
Negatively Impact Segment Revenues and Operating Results
Segment
revenues, operating results and cash flows have varied in the past and may be
exposed to significant volatility from quarter to quarter in the future due to
changes in general economic conditions, recessions or adverse conditions in the
end markets we serve. These changes could adversely impact overall sales,
operating results and cash flows, which in turn could trigger impairment of
goodwill or other long-lived assets due to the fair value of such assets falling
below the Company’s carrying value. Moreover, during economic downturns we may
undertake more extensive rationalization actions and therefore incur higher
rationalization expense during such periods. If our rationalization actions are
not sufficiently effective or if we must incur rationalization costs beyond what
we anticipate, we may not be able to achieve our anticipated operating
results.
13
We
Are Subject To Litigation and Environmental Regulations That Could Adversely
Impact Our Operating Results
We are,
and may in the future be, a party to a number of legal proceedings and claims,
including those involving product liability and environmental matters, several
of which claim, or may in the future claim, significant damages. Given the
inherent uncertainty of litigation, we can offer no assurance that existing
litigation or a future adverse development will not have a material adverse
impact. We also are subject to various laws and regulations relating to
environmental protection and the discharge of materials into the environment,
and we could incur substantial costs as a result of the noncompliance with or
liability for cleanup or other costs or damages under environmental
laws.
Item
1B. Unresolved Staff Comments
None.
Item 2.
Properties
At
September 30, 2010, Emerson had approximately 240 manufacturing locations
worldwide, of which approximately 160 were located outside the United States,
primarily in Europe and Asia, and to a lesser extent in Canada and Latin
America. The approximate numbers of manufacturing locations by business segment
are: Process Management, 60; Industrial Automation, 80; Network Power, 45;
Climate Technologies, 35; and Tools and Storage, 20. The majority of the
locations are owned, with the remainder occupied under lease. The Company
considers its facilities suitable and adequate for the purposes for which they
are used.
Item 3. Legal
Proceedings
The
information regarding legal proceedings set forth in Note 12 of Notes to
Consolidated Financial Statements of the 2010 Annual Report is hereby
incorporated by reference.
Item 4. [Removed and
Reserved]
14
Executive
Officers of the Registrant
The
following sets forth certain information as of November 23, 2010 with respect to
Emerson's executive officers. The Fiscal Year column indicates the first year
the executive served as an officer of the Company. These officers have been
elected or appointed to terms which expire February 1, 2011:
|
Name
|
Position
|
Age
|
Fiscal Year
|
|||
|
D.
N. Farr*
|
Chairman
of the Board and Chief Executive Officer
|
55
|
1985
|
|||
|
C.
W. Ashmore
|
Executive
Vice President - Planning and Development
|
48
|
2001
|
|||
|
F.
J. Dellaquila
|
Senior
Vice President and Chief Financial Officer
|
53
|
1991
|
|||
|
W.
J. Galvin
|
Vice
Chairman
|
64
|
1984
|
|||
|
E.
L. Monser
|
President
and Chief Operating Officer
|
60
|
2002
|
|||
|
C.
A. Peters
|
Senior
Executive Vice President
|
55
|
1990
|
|||
|
R.
J. Schlueter
|
Vice
President and Chief Accounting Officer
|
56
|
1992
|
|||
|
F.
L. Steeves
|
|
Senior
Vice President, Secretary and General Counsel
|
|
56
|
|
2007
|
*Also
chairman of the Executive Committee of the Board of Directors.
There are
no family relationships among any of the executive officers and
directors.
David N.
Farr has been Chief Executive Officer since October 2000 and was also appointed
Chairman of the Board in September 2004 and served as President from November
2005 to October 2010. Craig W. Ashmore was appointed Executive Vice President -
Planning and Development in October 2009. Prior to his current position, Mr.
Ashmore was Senior Vice President - Planning and Development from October 2004
to September 2009 and Group Vice President from 2003 to 2004. Frank J.
Dellaquila was appointed Chief Financial Officer in February 2010. Prior to his
current position, Mr. Dellaquila was Senior Vice President - Finance and
Controller from August 2009 to February 2010 and Senior Vice President -
Acquisitions and Development from 2004 to 2009. Walter J. Galvin was appointed
Vice Chairman in October 2009. Prior to his current position, Mr. Galvin was
Chief Financial Officer from 1993 to February 2010, Senior Executive Vice
President from October 2004 to September 2009 and Executive Vice President from
February 2000 to October 2004. Edward L. Monser was appointed President in
October 2010 and has been Chief Operating Officer since November
2001. Charles A. Peters has been Senior Executive Vice President since
October 2000. Richard J. Schlueter has been Vice President Accounting since 1999
and was also appointed Chief Accounting Officer in February 2003. Frank L.
Steeves was appointed Senior Vice President, Secretary and General Counsel in
March 2007, prior to which he was Vice Chairman of the Milwaukee-based law firm
of von Briesen & Roper, S.C., which has provided legal services to the
Company since 2001. Mr. Steeves joined von Briesen and Roper as a partner in
2001, and became Vice Chairman of the firm in 2004.
15
PART
II
Item 5. Market for
Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities
Information
regarding the market for the Company's common stock, quarterly market price
ranges and dividend payments is set forth in Note 18 of Notes to Consolidated
Financial Statements of the 2010 Annual Report, which note is hereby
incorporated by reference. There were approximately 24,755 stockholders of
record at September 30, 2010.
|
Period
|
Total Number of
Shares
Purchased (000s)
|
Average Price
Paid per Share
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans or
Programs (000s)
|
Maximum Number of
Shares that May Yet Be
Purchased Under the
Plans or Programs (000s)
|
||||||||||||
|
July
2010
|
315 | $ | 46.90 | 315 | 49,577 | |||||||||||
|
August
2010
|
250 | $ | 48.57 | 250 | 49,327 | |||||||||||
|
September
2010
|
12 | $ | 48.46 | 12 | 49,315 | |||||||||||
|
Total
|
577 | $ | 47.66 | 577 | 49,315 | |||||||||||
The
Company’s Board of Directors authorized the repurchase of up to 80 million
shares under the May 2008 program.
Item 6. Selected Financial
Data
Years
ended September 30
(dollars
in millions, except per share amounts)
|
2006
|
2007
|
2008
|
2009
|
2010
|
||||||||||||||||
|
Net
sales
|
$ | 18,588 | 21,013 | 23,751 | 20,102 | 21,039 | ||||||||||||||
|
Earnings
from continuing operations – common stockholders
|
$ | 1,809 | 2,087 | 2,446 | 1,715 | 1,978 | ||||||||||||||
|
Basic
earnings per common share from continuing operations
|
$ | 2.22 | 2.63 | 3.13 | 2.27 | 2.62 | ||||||||||||||
|
Diluted
earnings per common share from continuing operations
|
$ | 2.19 | 2.60 | 3.10 | 2.26 | 2.60 | ||||||||||||||
|
Cash
dividends per common share
|
$ | 0.89 | 1.05 | 1.20 | 1.32 | 1.34 | ||||||||||||||
|
Long-term
debt
|
$ | 3,128 | 3,372 | 3,297 | 3,998 | 4,586 | ||||||||||||||
|
Total
assets
|
$ | 18,672 | 19,680 | 21,040 | 19,763 | 22,843 | ||||||||||||||
Information
presented reflects the 2007 two-for-one stock split. The appliance motors and
U.S. commercial and industrial motors businesses for all periods presented, the
LANDesk unit for 2010 only, the European appliance motor and pump business for
2006 through 2008, and the Brooks Instrument flow meters and flow controls unit
for 2008 only, are classified as discontinued operations. See Note 3 of Notes to
Consolidated Financial Statements of the 2010 Annual Report, which note is
hereby incorporated by reference, for information regarding the Company's
acquisition and divestiture activities.
16
Item 7. Management's
Discussion and Analysis of Financial Condition and Results of
Operations
Information
appearing under “Results of Operations,” “Financial Position, Capital Resources
and Liquidity,” “Critical Accounting Policies,” “New Accounting Pronouncements”
and the "Safe Harbor Statement" in the 2010 Annual Report are hereby
incorporated by reference.
Fiscal 2011
Outlook
Fiscal
year 2010 was a challenging year but improving economic circumstances and strong
operating results in the second half of the year have Emerson well positioned
moving into 2011. Underlying sales for fiscal year 2011 are expected to increase
in the range of positive 7 percent to 10 percent, which excludes an estimated
favorable increase of 5 percent due to completed acquisitions and foreign
currency translation. Net sales for the year are forecast to be in the range of
positive 12 percent to 15 percent compared with 2010 sales of $21
billion. The Company also expects operating profit margin in the range of
17.2 percent to 17.5 percent (excludes 3.0 percent to 2.8 percent for other
deductions, net and interest) and pretax margin of 14.2 percent to 14.7 percent.
Operating cash flow is estimated at $3.4 to $3.5 billion. There can be no
assurance what impact future exchange rate changes will have.
Non-GAAP Financial
Measures
To
supplement Emerson’s financial information presented in accordance with U.S.
generally accepted accounting principles (GAAP), management uses certain
“non-GAAP financial measures,” as such term is defined in Regulation G under the
rules of the SEC, to clarify and enhance understanding of past performance and
prospects for the future. Generally, a non-GAAP financial measure is a numerical
measure of a company’s operating performance, financial position or cash flows
that excludes or includes amounts that are included in or excluded from the most
directly comparable measure calculated and presented in accordance with GAAP.
For example, non-GAAP measures may exclude the impact of certain unique items
such as acquisitions, divestitures, one-time gains and losses or items outside
of management’s control, such as foreign currency exchange rates. Management
believes that the following non-GAAP financial measures provide investors and
analysts useful insight into Emerson’s financial position and operating
performance. Any non-GAAP measure provided should be viewed in addition to, and
not as an alternative to, the most directly comparable measure determined in
accordance with U.S. GAAP, as identified in italics below. Further, the
calculation of these non-GAAP financial measures may differ from the calculation
of similarly titled financial measures presented by other companies and
therefore may not be comparable among companies.
Underlying
sales, which exclude the impact of acquisitions and divestitures during the
periods presented, and fluctuations in foreign currency exchange rates, are
provided to facilitate relevant period-to-period comparisons of sales growth by
excluding these unique items that impact the overall comparability (GAAP
measure: net
sales).
Operating
profit (defined as net sales less cost of sales and selling, general and
administrative expenses) and operating profit margin (defined as operating
profit divided by net sales) are indicative of short-term operational
performance and ongoing profitability. Management closely monitors operating
profit and operating profit margin of each business to evaluate past performance
and actions required to improve profitability (GAAP measures: pretax earnings or pretax profit
margin).
Earnings,
earnings per share, return on equity and return on total capital excluding
one-time gains and losses provide additional insight into the underlying,
ongoing operating performance of the Company and facilitate period-to-period
comparisons by excluding the earnings impact of these items. Given the unique
nature of these one-time items, management believes that presenting earnings,
earnings per share, return on equity and return on total capital excluding them
is more representative of the Company’s operational performance and may be more
useful for investors (GAAP measures: earnings, earnings per share, return
on equity, return on total capital).
17
Free cash
flow (operating cash flow less capital expenditures) is an indicator of the
Company’s cash generating capabilities after considering investments in capital
assets which are necessary to maintain and enhance existing operations. The
determination of operating cash flow adds back non-cash depreciation expense to
earnings and thereby does not reflect a charge for necessary capital
expenditures. Management believes that free cash flow is useful to both
management and investors as a measure of the Company’s ability to generate cash
(GAAP measure: operating cash
flow).
Item 7A. Quantitative and
Qualitative Disclosures About Market Risk
Information
appearing under "Financial Instruments" in the 2010 Annual Report is hereby
incorporated by reference.
Item 8. Financial Statements
and Supplementary Data
The
consolidated financial statements and notes thereto of the Company and its
subsidiaries and the report thereon of KPMG LLP in the 2010 Annual Report are
hereby incorporated by reference.
Item 9. Changes in and
Disagreements with Accountants on Accounting and Financial
Disclosure
None.
Item 9A. Controls and
Procedures
Emerson
maintains a system of disclosure controls and procedures which is designed to
ensure that information required to be disclosed by the Company in the reports
filed or submitted under the Securities Exchange Act of 1934 is recorded,
processed, summarized and reported within the time periods specified in the
SEC's rules and forms and is accumulated and communicated to management,
including the Company’s certifying officers, as appropriate to allow timely
decisions regarding required disclosure. Based on an evaluation performed, the
Company's certifying officers have concluded that the disclosure controls and
procedures were effective as of September 30, 2010 to provide reasonable
assurance of achieving these objectives.
Notwithstanding
the foregoing, there can be no assurance that the Company's disclosure controls
and procedures will detect or uncover all failures of persons within the Company
and its consolidated subsidiaries to report material information otherwise
required to be set forth in the Company's reports.
There was
no change in the Company's internal control over financial reporting during the
quarter ended September 30, 2010, that has materially affected, or is reasonably
likely to materially affect, the Company's internal control over financial
reporting.
Management’s
report on internal control over financial reporting, and the related report of
the Company’s auditor, KPMG LLP, an independent registered public accounting
firm, appearing in the 2010 Annual Report are hereby incorporated by
reference.
Item 9B. Other
Information
There
were no matters submitted to a vote of security holders during the quarter ended
September 30, 2010.
18
PART
III
Item 10. Directors,
Executive Officers and Corporate Governance
Information
regarding nominees and directors appearing under "Nominees and Continuing
Directors" in the Emerson Electric Co. Notice of Annual Meeting of Stockholders
and Proxy Statement for the February 2011 annual stockholders' meeting (the
"2011 Proxy Statement") is hereby incorporated by reference. Information
regarding executive officers is set forth in Part I of this report. Information
appearing under "Section 16(a) Beneficial Ownership Reporting Compliance" in the
2011 Proxy Statement is hereby incorporated by reference. Information regarding
the Audit Committee and Audit Committee Financial Expert appearing under "Board
of Directors and Committees" in the 2011 Proxy Statement is hereby incorporated
by reference.
Emerson
has adopted a Code of Ethics that applies to the Company's chief executive
officer, chief financial officer and chief accounting officer; has posted such
Code of Ethics on its Internet website; and intends to satisfy the disclosure
requirement under Item 5.05 of Form 8-K by posting such information on its
Internet website. Emerson has adopted Charters for its Audit Committee,
Compensation Committee and Corporate Governance and Nominating Committee and a
Code of Business Ethics for directors, officers and employees, which are
available on its Internet website and are available in print to any shareholder
who requests them. Emerson has also adopted Corporate Governance Principles and
Practices, which are available on its Internet website and are available in
print to any shareholder who requests them. The Company's Internet website may
be accessed as follows: www.Emerson.com, Investor Relations, Corporate
Governance.
Item 11. Executive
Compensation
Information
appearing under “Board of Directors and Committees—Compensation Committee,”
“Board of Directors and Committees—Corporate Governance and Nominating
Committee,” “Director Compensation,” “Executive Compensation” (including, but
not limited to, the information set forth under “Compensation Discussion and
Analysis,” “Compensation Committee Report” and “Summary Compensation Table”) and
“Compensation Committee Interlocks and Insider Participation” in the 2011 Proxy
Statement is hereby incorporated by reference.
The
information contained in “Compensation Committee Report” shall not be deemed to
be filed with the SEC or subject to the liabilities of Section 18 of the
Securities Exchange Act of 1934 (the “Exchange Act”), except to the extent that
Emerson specifically incorporates such information into future filings under the
Securities Act of 1933 or the Exchange Act.
Item 12. Security Ownership
of Certain Beneficial Owners and Management and Related Stockholder
Matters
The
information regarding beneficial ownership of shares by nominees and continuing
directors, named executive officers and by all directors and executive officers
as a group appearing under "Stock Ownership of Directors, Executive Officers and
5% Beneficial Owners" in the 2011 Proxy Statement is hereby incorporated by
reference.
Information
regarding equity compensation plans appearing under “Equity Compensation Plan
Information” in the 2011 Proxy Statement is hereby incorporated by reference.
Information regarding stock option plans and incentive shares plans set forth in
Note 14 of Notes to Consolidated Financial Statements of the 2010 Annual Report
is hereby incorporated by reference.
19
Item 13. Certain
Relationships and Related Transactions, and Director
Independence
Information
appearing under “Director Independence” in the 2011 Proxy Statement is hereby
incorporated by reference.
Item 14. Principal
Accountant Fees and Services
Information
appearing under "Fees Paid to KPMG LLP" in the 2011 Proxy Statement is hereby
incorporated by reference.
PART
IV
Item 15. Exhibits and
Financial Statement Schedules
A) Documents
filed as a part of this report:
|
1.
|
The
consolidated financial statements and notes of the Company and its
subsidiaries and the report thereon of KPMG LLP in the 2010 Annual
Report.
|
||
|
2.
|
Financial
Statement Schedules
|
||
|
All
schedules are omitted because they are not required, not applicable or the
information is given in the financial statements or notes thereto
contained in the 2010 Annual Report.
|
|||
|
3.
|
Exhibits
(Listed by numbers corresponding to the Exhibit Table of Item 601 in
Regulation S-K).
|
||
|
3(a)
|
Restated
Articles of Incorporation of Emerson Electric Co., incorporated by
reference to Emerson Electric Co. Form 10-Q for the quarter ended March
31, 2001, File No. 1-278, Exhibit 3(a); Termination of Designated Shares
of Stock and Certificate of Designation, Preferences and Rights of Series
B Junior Participating Preferred Stock, incorporated by reference to
Emerson Electric Co. 1998 Form 10-K, File No. 1-278, Exhibit
3(a).
|
||
|
3(b)
|
Bylaws
of Emerson Electric Co., as amended through November 2, 2010, incorporated
by reference to Emerson Electric Co. Form 8-K dated November 5, 2010,
Exhibit 3.1.
|
||
|
4(a)
|
Indenture
dated as of April 17, 1991, between Emerson Electric Co. and The Boatmen's
National Bank of St. Louis, Trustee, incorporated by reference to Emerson
Electric Co. Registration Statement on Form S-3, File No. 33-62545,
Exhibit 4.1.
|
||
|
4(b)
|
Indenture
dated as of December 10, 1998, between Emerson Electric Co. and The Bank
of New York, Trustee, incorporated by reference to Emerson Electric Co.
1998 Form 10-K, File No. 1-278, Exhibit 4(b).
|
||
|
No
other long-term debt instruments are filed since the total amount of
securities authorized under any such instrument does not exceed 10 percent
of the total assets of Emerson Electric Co. and its subsidiaries on a
consolidated basis. Emerson Electric Co. agrees to furnish a copy of such
instruments to the SEC upon request.
|
|||
|
10(a)*
|
1991
Stock Option Plan, as amended, incorporated by reference to Emerson
Electric Co. 1997 Form 10-K, File No. 1-278, Exhibit 10(e) and Amendment
No. 1 thereto, incorporated by reference to Emerson Electric Co. 2000 Form
10-K, File No. 1-278, Exhibit
10(c).
|
||
20
|
10(b)*
|
Third
Amendment to the Emerson Electric Co. 1993 Incentive Shares Plan, as
restated, incorporated by reference to Emerson Electric Co. 1996 Form
10-K, File No. 1-278, Exhibit 10(g), and Fourth Amendment thereto,
incorporated by reference to Emerson Electric Co. 2001 Form 10-K, File No.
1-278, Exhibit 10(d).
|
||
|
10(c)*
|
Amended
and Restated Emerson Electric Co. Continuing Compensation Plan for
Non-Management Directors, incorporated by reference to Emerson Electric
Co. 2007 Form 10-K, File No. 1-278, Exhibit 10(c).
|
||
|
10(d)*
|
Amended
and Restated Deferred Compensation Plan for Non-Employee Directors and
Forms of Payment Election Form, Initial Notice of Election and Notice of
Election Change, incorporated by reference to Emerson Electric Co. 2007
Form 10-K, File No. 1-278, Exhibit 10(d).
|
||
|
10(e)*
|
First
Amendment to the Emerson Electric Co. Supplemental Executive Retirement
Plan, incorporated by reference to Emerson Electric Co. 1999 Form 10-K,
File No. 1-278, Exhibit 10(h), and Form of Change of Control Election,
incorporated by reference to Emerson Electric Co. Form 8-K dated October
1, 2004, Exhibit 10.9 (applicable only with respect to benefits vested as
of December 31, 2004).
|
||
|
10(f)*
|
Amended
and Restated Emerson Electric Co. Pension Restoration Plan and Forms of
Participation Award Letter, Acceptance of Award and Benefit Election Forms
(applicable only with respect to benefits after January 1, 2005),
incorporated by reference to Emerson Electric Co. 2007 Form 10-K, File No.
1-278, Exhibit 10(f).
|
||
|
10(g)*
|
Fifth
Amendment to the Supplemental Executive Savings Investment Plan,
incorporated by reference to Emerson Electric Co. Form 10-Q for the
quarter ended March 31, 1999, File No. 1-278, Exhibit 10(j), and Form of
Participation Agreement and Form of Annual Election, incorporated by
reference to Emerson Electric Co. Form 8-K dated October 1, 2004, Exhibit
10.8 (applicable only with respect to benefits vested as of December 31,
2004).
|
||
|
10(h)*
|
Amended
and Restated Emerson Electric Co. Savings Investment Restoration Plan and
Forms of Participation Agreement, Annual Election Form and Payment
Election Form (applicable only with respect to benefits after January 1,
2005), incorporated by reference to Emerson Electric Co. 2007 Form 10-K,
File No. 1-278, Exhibit 10(h), and First Amendment to Emerson Electric Co.
Savings Investment Restoration Plan, incorporated by reference to Emerson
Electric Co. Form 10-Q for the quarter ended March 31, 2008, File No.
1-278, Exhibit 10.1.
|
||
|
10(i)*
|
Amended
and Restated Emerson Electric Co. Annual Incentive Plan and Form of
Acceptance of Award, incorporated by reference to Emerson Electric Co.
2007 Form 10-K, File No. 1-278, Exhibit 10(i).
|
||
|
10(j)*
|
1997
Incentive Shares Plan, incorporated by reference to Emerson Electric Co.
1997 Proxy Statement dated December 6, 1996, File No. 1-278, Exhibit A,
and First Amendment thereto, incorporated by reference to Emerson Electric
Co. 2001 Form 10-K, File No. 1-278, Exhibit 10(j), Amendment for 409A
Compliance, incorporated by reference to Emerson Electric Co. 2007 Form
10-K, File No. 1-278, Exhibit 10(j), Form of Performance Share Award
Certificate, Forms of Acceptance of Award and Change of Control Election,
incorporated by reference to Emerson Electric Co. Form 8-K dated October
1, 2004, Exhibit 10.5, and Form of Restricted Shares Award Agreement,
incorporated by reference to Emerson Electric Co. Form 8-K dated October
1, 2004, Exhibit 10.6.
|
||
|
10(k)*
|
1998
Stock Option Plan, incorporated by reference to Emerson Electric Co. 1998
Proxy Statement dated December 12, 1997, File No. 1-278, Appendix A, and
Amendment No. 1
|
21
|
thereto,
incorporated by reference to Emerson Electric Co. 2000 Form 10-K, File No.
1-278, Exhibit 10(l), Form of Notice of Grant of Stock Options and Option
Agreement and Form of Incentive Stock Option Agreement, incorporated by
reference to Emerson Electric Co. Form 8-K dated October 1, 2004, Exhibit
10.1, and Form of Notice of Grant of Stock Options and Option Agreement
and Form of Nonqualified Stock Option Agreement, incorporated by reference
to Emerson Electric Co. Form 8-K dated October 1, 2004, Exhibit
10.2.
|
|||
|
10(l)*
|
2001
Stock Option Plan, incorporated by reference to Emerson Electric Co. 2002
Proxy Statement dated December 12, 2001, File No. 1-278, Appendix A, Form
of Notice of Grant of Stock Options and Option Agreement and Form of
Incentive Stock Option Agreement, incorporated by reference to Emerson
Electric Co. Form 8-K dated October 1, 2004, Exhibit 10.3, and Form of
Notice of Grant of Stock Options and Option Agreement and Form of
Nonqualified Stock Option Agreement, incorporated by reference to Emerson
Electric Co. Form 8-K dated October 1, 2004, Exhibit
10.4.
|
||
|
10(m)*
|
Emerson
Electric Co. Description of Split Dollar Life Insurance Program
Transition, incorporated by reference to Emerson Electric Co. Form 8-K
dated August 31, 2005, Exhibit 10.1.
|
||
|
10(n)*
|
Amended
and Restated Restricted Stock Plan for Non-Management Directors,
incorporated by reference to Emerson Electric Co. Form 10-Q for the
quarter ended December 31, 2009, File No. 1-278, Exhibit 10.1, Form of
Restricted Stock Award Letter under the Emerson Electric Co. Restricted
Stock Plan for Non-Management Directors, incorporated by reference to
Emerson Electric Co. Form 8-K dated February 1, 2005, Exhibit 10.2, and
Form of Restricted Stock Unit Award Letter under the Emerson Electric Co.
Restricted Stock Plan for Non-Management Directors, incorporated by
reference to Emerson Electric Co. Form 10-Q for the quarter ended December
31, 2009, File No. 1-278, Exhibit 10.1.
|
||
|
10(o)*
|
Description
of Non-Management Director Compensation, incorporated by reference to
Emerson Electric Co. Form 10-Q for the quarter ended March 31, 2007, File
No. 1-278, Exhibit 10.1, and Summary of Changes to Compensation
Arrangements for Non-Management Directors, incorporated by reference to
Emerson Electric Co. Form 10-Q for the quarter ended June 30, 2008, File
No. 1-278, Exhibit 10.2.
|
||
|
10(p)*
|
Description
of Named Executive Officer Compensation, incorporated by reference to
Emerson Electric Co. Form 10-Q for the quarter ended December 31, 2004,
Exhibit 10.1.
|
||
|
10(q)*
|
Emerson
Electric Co. 2006 Incentive Shares Plan, incorporated by reference to
Emerson Electric Co. 2006 Proxy Statement dated December 16, 2005,
Appendix C, Amendment for 409A Compliance, incorporated by reference to
Emerson Electric Co. 2007 Form 10-K, File No. 1-278, Exhibit 10(q), Forms
of Performance Share Award Certificate, Acceptance of Award and Restricted
Share Award Agreement, incorporated by reference to Emerson Electric Co.
2007 Form 10-K, File No. 1-278, Exhibit 10(q), Forms of Performance Share
Award Certificate, Acceptance of Award and 2010 Performance Shares Program
Award Summary, incorporated by reference to Emerson Electric Co. Form 10-Q
for the quarter ended December 31, 2009, File No. 1-278, Exhibit 10.2, and
Amendment to Emerson Electric Co. 2006 Incentive Shares Plan, incorporated
by reference to Emerson Electric Co. Form 10-Q for the quarter ended June
30, 2008, File No. 1-278, Exhibit 10.1.
|
||
|
10(r)
|
Long-Term
Credit Agreement dated as of April 28, 2006, incorporated by reference to
Emerson Electric Co. Form 8-K dated May 2, 2006, Exhibit
10.1.
|
||
|
12
|
Ratio
of Earnings to Fixed
Charges.
|
22
|
13
|
Portions
of Emerson Electric Co. Annual Report to Stockholders for the year ended
September 30, 2010, incorporated by reference herein.
|
||
|
21
|
Subsidiaries
of Emerson Electric Co.
|
||
|
23
|
Consent
of Independent Registered Public Accounting Firm.
|
||
|
24
|
Power
of Attorney.
|
||
|
31
|
Certifications
pursuant to Exchange Act Rule 13a-14(a).
|
||
|
32
|
Certifications
pursuant to Exchange Act Rule 13a-14(b) and 18 U.S.C. Section
1350.
|
||
|
101
|
Attached
as Exhibit 101 to this report are the following documents formatted in
XBRL (Extensible Business Reporting Language): (i) Consolidated Statements
of Earnings for the years ended September 30, 2008, 2009 and 2010, (ii)
Consolidated Balance Sheets at September 30, 2009 and 2010, (iii)
Consolidated Statements of Equity for the years ended September 30, 2008,
2009 and 2010, (iv) Consolidated Statements of Cash Flows for the years
ended September 30, 2008, 2009 and 2010, and (v) Notes to Consolidated
Financial Statements for the year ended September 30, 2010. In
accordance with Rule 406T of Regulation S-T, the XBRL related information
in Exhibit 101 to this Annual Report on Form 10-K shall not be deemed to
be “filed” for purposes of Section 18 of the Exchange Act, and shall not
be deemed “filed” or part of any registration statement or prospectus for
purposes of Section 11 or 12 under the Securities Act or the Exchange Act,
or otherwise subject to liability under those sections, except as shall be
expressly set forth by specific reference in such
filing.
|
||
|
*
Management contract or compensatory
plan.
|
23
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
|
EMERSON
ELECTRIC CO.
|
||||
|
By
|
/s/
|
F. J. Dellaquila
|
||
|
F.
J. Dellaquila
|
||||
|
Senior
Vice President and
|
||||
|
Chief
Financial Officer
|
||||
Date:
November 23, 2010
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below on November 23, 2010, by the following persons on behalf of the
registrant and in the capacities indicated.
|
Signature
|
Title
|
|||
|
/s/
|
D. N. Farr
|
Chairman
of the Board and Chief Executive Officer
|
||
|
D.
N. Farr
|
||||
|
/s/
|
W. J. Galvin
|
Vice
Chairman and Director
|
||
|
W.
J. Galvin
|
||||
|
/s/
|
F. J. Dellaquila
|
Senior
Vice President and Chief Financial Officer
|
||
|
F.
J. Dellaquila
|
||||
|
/s/
|
R. J. Schlueter
|
Vice
President and Chief Accounting Officer
|
||
|
R.
J. Schlueter
|
||||
|
*
|
Director
|
|||
|
C.
A. H. Boersig
|
||||
|
*
|
Director
|
|||
|
A.
A. Busch III
|
||||
|
*
|
Director
|
|||
|
C.
Fernandez G.
|
||||
|
*
|
Director
|
|||
|
A.
F. Golden
|
||||
24
|
*
|
Director
|
|||
|
H.
Green
|
||||
|
*
|
Director
|
|||
|
R.
B. Horton
|
||||
|
*
|
Director
|
|||
|
W.
R. Johnson
|
||||
|
*
|
Director
|
|||
|
V.
R. Loucks, Jr.
|
||||
|
*
|
Director
|
|||
|
J.
B. Menzer
|
||||
|
*
|
Director
|
|||
|
C.
A. Peters
|
||||
|
*
|
Director
|
|||
|
J.
W. Prueher
|
||||
|
*
|
Director
|
|||
|
R.
L. Ridgway
|
||||
|
*
|
Director
|
|||
|
R.
L. Stephenson
|
|
*
By
|
/s/
|
F. J. Dellaquila
|
||
|
F.
J. Dellaquila
|
||||
|
Attorney-in-Fact
|
||||
25
INDEX TO
EXHIBITS
Exhibits
are listed by numbers corresponding to the Exhibit Table of Item 601 in
Regulation S-K.
|
Exhibit No.
|
Exhibit
|
|
|
12
|
Ratio
of Earnings to Fixed Charges
|
|
|
13
|
Portions
of Emerson Electric Co. Annual Report to Stockholders for the year ended
September 30, 2010, incorporated by reference herein
|
|
|
21
|
Subsidiaries
of Emerson Electric Co.
|
|
|
23
|
Consent
of Independent Registered Public Accounting Firm
|
|
|
24
|
Power
of Attorney
|
|
|
31
|
Certifications
pursuant to Exchange Act Rule 13a – 14(a)
|
|
|
32
|
Certifications
pursuant to Exchange Act Rule 13a – 14(b) and 18 U.S.C. Section
1350
|
|
|
101
|
Attached
as Exhibit 101 to this report are the following documents formatted in
XBRL (Extensible Business Reporting Language): (i) Consolidated Statements
of Earnings for the years ended September 30, 2008, 2009 and 2010, (ii)
Consolidated Balance Sheets at September 30, 2009 and 2010, (iii)
Consolidated Statements of Equity for the years ended September 30, 2008,
2009 and 2010, (iv) Consolidated Statements of Cash Flows for the years
ended September 30, 2008, 2009 and 2010, and (v) Notes to Consolidated
Financial Statements for the year ended September 30, 2010. In
accordance with Rule 406T of Regulation S-T, the XBRL related information
in Exhibit 101 to this Annual Report on Form 10-K shall not be deemed to
be “filed” for purposes of Section 18 of the Exchange Act, and shall not
be deemed “filed” or part of any registration statement or prospectus for
purposes of Section 11 or 12 under the Securities Act or the Exchange Act,
or otherwise subject to liability under those sections, except as shall be
expressly set forth by specific reference in such
filing.
|
See
Item 15(A) 3. for a list of exhibits incorporated by
reference.
26