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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Quarterly Period Ended March 31, 2011
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission File Number 1-6747
 The Gorman-Rupp Company
  Ohio
    
    34-0253990(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 600 South Airport Road, Mansfield, Ohio
    
    44903(Address of principal executive offices)
    
    (Zip Code)
 (419) 755-1011
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o
 o þ
 16,788,535




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##### 



The Gorman-Rupp Company and Subsidiaries
Three Months Ended March 31, 2011 and 2010
 PART I. FINANCIAL INFORMATIONItem 1. Financial Statements (Unaudited)
    
    
    3Condensed Consolidated Statements of Income -Three months ended March 31, 2011 and 2010
    
    
    3Condensed Consolidated Balance Sheets -March 31, 2011 and December 31, 2010
    
    
    4Condensed Consolidated Statements of Cash Flows-Three months ended March 31, 2011 and 2010
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    8Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    12Item 4. Controls and Procedures
    
    
    12PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    13Item 1A. Risk Factors
    
    
    13Item 6. Exhibits
    
    
    14EX-31.1 302 Principal Executive Officer (PEO) CertificationEX-31.2 302 Principal Financial Officer (PFO) CertificationEX-32 Section 1350 Certifications
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PART I. FINANCIAL INFORMATION
 
 ITEM 1FINANCIAL STATEMENTS (UNAUDITED)
 THE GORMAN-RUPP COMPANY AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)
 Three Months EndedMarch 31,(Thousands of dollars, except per share amounts)
    
    2011
    
    
    2010Net sales
    
    $
    84,074
    
    
    $
    65,786Cost of products sold
    
    
    62,688
    
    
    
    50,337Gross profit
    
    
    21,386
    
    
    
    15,449Selling, general and
administrative expenses
    
    
    10,727
    
    
    
    8,759Operating income
    
    
    10,659
    
    
    
    6,690Other income
    
    
    111
    
    
    
    125Other expense
    
    
    (142
    )
    
    
    (116
    )Income before income taxes
    
    
    10,628
    
    
    
    6,699Income taxes
    
    
    3,509
    
    
    
    2,202Net income
    
    $
    7,119
    
    
    $
    4,497Earnings per share
    
    $
    0.42
    
    
    $
    0.27Cash dividends paid per share
    
    $
    0.105
    
    
    $
    0.105Weighted average shares outstanding
    
    
    16,788,535
    
    
    
    16,710,535
 See notes to condensed consolidated financial statements.
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THE GORMAN-RUPP COMPANY AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 UnauditedMarch 31,
    
    
    December 31,(Thousands of dollars)
    
    2011
    
    
    2010AssetsCurrent assets:Cash and cash equivalents
    
    $
    31,085
    
    
    $
    32,229Short-term investments
    
    
    1,844
    
    
    
    2,017Accounts receivable  net
    
    
    54,811
    
    
    
    51,996Inventories  net
    
    
    56,958
    
    
    
    51,449Deferred income taxes and other current
assets
    
    
    3,869
    
    
    
    5,503Total current assets
    
    
    148,567
    
    
    
    143,194Property, plant and equipment
    
    
    218,743
    
    
    
    216,239Less accumulated depreciation
    
    
    105,463
    
    
    
    102,713Property, plant and equipment  net
    
    
    113,280
    
    
    
    113,526Prepaid pension and other assets
    
    
    5,565
    
    
    
    3,545Goodwill and other intangible assets
    
    
    26,189
    
    
    
    26,442Total assets
    
    $
    293,601
    
    
    $
    286,707Liabilities and shareholders equityCurrent liabilities:Accounts payable
    
    $
    14,115
    
    
    $
    12,042Short-term debt
    
    
    22,000
    
    
    
    25,000Payroll and related liabilities
    
    
    7,153
    
    
    
    7,794Commissions payable
    
    
    6,039
    
    
    
    6,591Accrued expenses
    
    
    10,934
    
    
    
    8,251Total current liabilities
    
    
    60,241
    
    
    
    59,678Postretirement benefits
    
    
    22,430
    
    
    
    22,241Deferred and other income taxes
    
    
    4,954
    
    
    
    4,954Total liabilities
    
    
    87,625
    
    
    
    86,873Shareholders equityCommon shares, without par value:Authorized  35,000,000 sharesOutstanding  16,788,535 shares in 2011
and 2010 (after deducting treasury
shares of 523,683 in 2011 and 2010)
at stated capital amount
    
    
    5,127
    
    
    
    5,127Additional paid-in capital
    
    
    2,400
    
    
    
    2,400Retained earnings
    
    
    207,091
    
    
    
    201,735Accumulated other comprehensive loss
    
    
    (8,642
    )
    
    
    (9,428
    )Total shareholders equity
    
    
    205,976
    
    
    
    199,834Total liabilities and shareholders
equity
    
    $
    293,601
    
    
    $
    286,707
 See notes to condensed consolidated financial statements.
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THE GORMAN-RUPP COMPANY AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)
 Three Months EndedMarch 31,(Thousands of dollars)
    
    2011
    
    
    2010Cash flows from operating activities:Net income
    
    $
    7,119
    
    
    $
    4,497Adjustments to reconcile net income attributable
to net cash provided by operating activities:Depreciation and amortization
    
    
    2,805
    
    
    
    2,597Changes in operating assets and liabilities:Accounts receivable
    
    
    (2,816
    )
    
    
    (5,500
    )Inventories
    
    
    (5,509
    )
    
    
    1,967Accounts payable
    
    
    2,073
    
    
    
    2,577Commissions payable
    
    
    (552
    )
    
    
    758Accrued expenses and other
    
    
    2,255
    
    
    
    2,074Net cash provided by operating activities
    
    
    5,375
    
    
    
    8,970Cash flows from investing activities:Capital additions  net
    
    
    (2,299
    )
    
    
    (2,577
    )Change in short-term investments
    
    
    173
    
    
    
    (4
    )Net cash used for investing activities
    
    
    (2,126
    )
    
    
    (2,581
    )Cash flows from financing activities:Cash dividends
    
    
    (1,763
    )
    
    
    (1,755
    )Payments to bank for borrowings
    
    
    (3,000
    )
    
    
    (5,000
    )Net cash used for financing activities
    
    
    (4,763
    )
    
    
    (6,755
    )Effect of exchange rate changes on cash
    
    
    370
    
    
    
    (18
    )Net (decrease) increase in cash
and cash equivalents
    
    
    (1,144
    )
    
    
    (384
    )Cash and cash equivalents:Beginning of year
    
    
    32,229
    
    
    
    44,403March 31,
    
    $
    31,085
    
    
    $
    44,019
 See notes to condensed consolidated financial statements.
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PART I
 ITEM 1.
    
    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 NOTE A  BASIS OF PRESENTATION OF FINANCIAL STATEMENTS
  NOTE B  INVENTORIES
   March 31,
    
    
    December 31,(Thousands of dollars)
    
    2011
    
    
    2010Raw materials and in-process
    
    $
    21,360
    
    
    $
    20,128Finished parts
    
    
    31,015
    
    
    
    27,005Finished products
    
    
    4,583
    
    
    
    4,316Total inventories
    
    $
    56,958
    
    
    $
    51,449
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PART I  CONTINUED
 ITEM 1.
    
    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)  CONTINUED
 NOTE C  PRODUCT WARRANTIES
  March 31,(Thousands of dollars)
    
    2011
    
    
    2010Balance at beginning of year
    
    $
    1,543
    
    
    $
    1,863Provision
    
    
    467
    
    
    
    119Claims
    
    
    (377
    )
    
    
    (484
    )Balance at end of period
    
    $
    1,633
    
    
    $
    1,498
 NOTE D  COMPREHENSIVE INCOME
  Three Months EndedMarch 31,(Thousands of dollars)
    
    2011
    
    
    2010Net income
    
    $
    7,119
    
    
    $
    4,497Changes in cumulative foreign currency
translation adjustments
    
    
    943
    
    
    
    (108
    )Pension and OPEB adjustments
    
    
    (157
    )
    
    
    269Noncontrolling interest
    
    
    
    
    
    
    (19
    )Total comprehensive income
    
    $
    7,905
    
    
    $
    4,639
 NOTE E  PENSION AND OTHER POSTRETIREMENT BENEFITS
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PART I  CONTINUED
 ITEM 1.
    
    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)  CONTINUED
 NOTE E  PENSION AND OTHER POSTRETIREMENT BENEFITS  CONTINUED
  Pension Benefits
    
    
    Postretirement BenefitsThree Months Ended
    
    
    Three Months EndedMarch 31,
    
    
    March 31,(Thousands of dollars)
    
    2011
    
    
    2010
    
    
    2011
    
    
    2010Service cost
    
    $
    714
    
    
    $
    680
    
    
    $
    263
    
    
    $
    276Interest cost
    
    
    767
    
    
    
    789
    
    
    
    277
    
    
    
    314Expected return on plan assets
    
    
    (1,128
    )
    
    
    (1,107
    )
    
    
    
    
    
    
    Recognized actuarial (gain) loss
    
    
    419
    
    
    
    394
    
    
    
    (164
    )
    
    
    (143
    )Benefit cost
    
    $
    772
    
    
    $
    756
    
    
    $
    376
    
    
    $
    447
 NOTE F  SUBSEQUENT EVENT
  
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Executive Overview
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PART I  CONTINUED
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS  CONTINUED
 First Quarter 2011 Compared to First Quarter 2010
 Net Sales
 Three Months EndedMarch 31,(Thousands of dollars)
    
    2011
    
    
    2010
    
    
    $ Change
    
    
    % ChangeNet sales
    
    $
    84,074
    
    
    $
    65,786
    
    
    $
    18,288
    
    
    
    27.8
    %
   Cost of Products Sold
 Three Months EndedMarch 31,(Thousands of dollars)
    
    2011
    
    
    2010
    
    
    $ Change
    
    
    % ChangeCost of products sold
    
    $
    62,688
    
    
    $
    50,337
    
    
    $
    12,351
    
    
    
    24.5
    %% of Net sales
    
    
    74.6
    %
    
    
    76.5
    %
  Selling, General and Administrative Expenses (SG&A)
 Three Months EndedMarch 31,(Thousands of dollars)
    
    2011
    
    
    2010
    
    
    $ Change
    
    
    % ChangeSelling, general and
administrative expenses
(SG&A)
    
    $
    10,727
    
    
    $
    8,759
    
    
    $
    1,968
    
    
    
    22.5
    %% of Net sales
    
    
    12.8
    %
    
    
    13.3
    %
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PART I  CONTINUED
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  CONTINUED
  Net Income
 Three Months EndedMarch 31,(Thousands of dollars)
    
    2011
    
    
    2010
    
    
    $ Change
    
    
    % ChangeIncome before income taxes
    
    $
    10,628
    
    
    $
    6,699
    
    
    $
    3,929
    
    
    
    58.7
    %% of Net sales
    
    
    12.6
    %
    
    
    10.2
    %Income taxes
    
    $
    3,509
    
    
    $
    2,202
    
    
    $
    1,307
    
    
    
    59.4
    %Effective tax rate
    
    
    33.0
    %
    
    
    32.9
    %Net income
    
    $
    7,119
    
    
    $
    4,497
    
    
    $
    2,622
    
    
    
    58.3
    %% of Net sales
    
    
    8.5
    %
    
    
    6.8
    %Earnings per share
    
    $
    0.42
    
    
    $
    0.27
    
    
    $
    0.15
    
    
    
    55.6
    %
  Liquidity and Capital Resources
 Three Months EndedMarch 31,(Thousands of dollars)
    
    2011
    
    
    2010Net cash provided by operating activities
    
    $
    5,375
    
    
    $
    8,970Net cash used for investing activities
    
    
    (2,126
    )
    
    
    (2,581
    )Net cash used for financing activities
    
    
    (4,763
    )
    
    
    (6,755
    )
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PART I  CONTINUED
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  CONTINUED
    Critical Accounting Policies
 Managements Discussion and Analysis of
Financial Condition and Results of Operations
 Safe Harbor Statement
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PART I  CONTINUED
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  CONTINUED
  
 ITEM 3.
    
    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  
 ITEM 4.
    
    CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
   Changes in Internal Control Over Financial Reporting
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PART II OTHER INFORMATION
 
 ITEM 1.
    
    LEGAL PROCEEDINGS
  
 ITEM 1A.
    
    RISK FACTORS
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ITEM 6.
    
    EXHIBITS
 (a)
    
    Exhibits
 Exhibits 3 and 4
    
    (articles of incorporation) are incorporated herein
by this reference from Exhibits (3) and (4) of the Companys
Annual Report on Form 10-K for the year ended December 31, 2010.Exhibits 3, 4 and 10
    
    (by-laws; instruments defining the rights of
security holders, including indentures; and material contracts)
are incorporated herein by this reference from Exhibits (3), (4)
and (10) of the Companys Annual Report on Form 10-K for the year
ended December 31, 2010.Exhibit 31.1
    
    Certification of Jeffrey S. Gorman, Chief Executive
Officer, pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.Exhibit 31.2
    
    Certification of Wayne L. Knabel, Chief Financial Officer,
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.Exhibit 32
    
    Certification pursuant to 18 U.S.C Section 1350, as adopted
Pursuant to Section 906 of The Sarbanes-Oxley Act of 2002.
 
 SIGNATURES
  The Gorman-Rupp Company(Registrant)Date: May 2, 2011
    
    By:
    
    /s/ Wayne L. Knabel

Wayne L. KnabelChief Financial Officer
  14