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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, 2009
 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.)305 Bowman Street, 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(Do not check if a smaller reporting company)
Smaller reporting company o o þ
 16,707,535




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##### 



The Gorman-Rupp Company and Subsidiaries
Three Months Ended March 31, 2009 and 2008
 PART I. FINANCIAL INFORMATIONItem 1. Financial Statements (Unaudited)
    
    
    3Condensed Consolidated Statements of Income
 Three months ended March 31, 2009 and 2008
    
    
    3Condensed Consolidated Balance Sheets  March 31, 2009 and December 31, 2008
    
    
    4Condensed Consolidated Statements of Cash Flows
 Three months ended March 31, 2009 and 2008
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    9Item 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-3 Articles of Incorporation and By-lawsEX-4 Instruments Defining the Rights of Security Holders, including IndenturesEX-10 Material ContractsEX-31.1 302 Principal Executive Officer (PEO) CertificationEX-31.2 302 Principal Financial Officer (PFO) CertificationEX-32 Section 1350 CertificationsEX-31.1EX-31.2EX-32
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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)
    
    2009
    
    
    2008Net sales
    
    $
    71,598
    
    
    $
    81,434Cost of products sold
    
    
    56,253
    
    
    
    61,590Gross profit
    
    
    15,345
    
    
    
    19,844Selling, general and
administrative expenses
    
    
    8,988
    
    
    
    9,499Operating income
    
    
    6,357
    
    
    
    10,345Other income
    
    
    765
    
    
    
    616Other expense
    
    
    (254
    )
    
    
    (73
    )Income before income taxes
    
    
    6,868
    
    
    
    10,888Income taxes
    
    
    2,362
    
    
    
    3,736Net income
    
    $
    4,506
    
    
    $
    7,152Basic and diluted
earnings per share
    
    $
    0.27
    
    
    $
    0.43Dividends paid per share
    
    $
    0.10
    
    
    $
    0.10Average shares outstanding
    
    
    16,707,535
    
    
    
    16,703,035
 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)
    
    2009
    
    
    2008AssetsCurrent assets:Cash and cash equivalents
    
    $
    30,476
    
    
    $
    23,793Accounts receivable  net
    
    
    43,859
    
    
    
    48,200Inventories  net
    
    
    52,423
    
    
    
    56,881Deferred income taxes and other current assets
    
    
    2,573
    
    
    
    5,392Total current assets
    
    
    129,331
    
    
    
    134,266Property, plant and equipment
    
    
    185,915
    
    
    
    178,030Less allowances for depreciation
    
    
    98,217
    
    
    
    97,624Property, plant and equipment  net
    
    
    87,698
    
    
    
    80,406Deferred income taxes and other assets
    
    
    16,791
    
    
    
    16,866Total assets
    
    $
    233,820
    
    
    $
    231,538Liabilities and shareholders equityCurrent liabilities:Accounts payable
    
    $
    10,147
    
    
    $
    15,878Short-term debt
    
    
    5,671
    
    
    
    Payrolls and related liabilities
    
    
    6,137
    
    
    
    7,442Accrued expenses
    
    
    13,550
    
    
    
    12,249Total current liabilities
    
    
    35,505
    
    
    
    35,569Income taxes payable
    
    
    863
    
    
    
    863Retirement benefits
    
    
    10,876
    
    
    
    11,421Postretirement benefits
    
    
    24,292
    
    
    
    24,020Deferred income taxes
    
    
    457
    
    
    
    459Total liabilities
    
    
    71,993
    
    
    
    72,332The Gorman-Rupp Company shareholders equity
Common shares, without par value:Authorized  35,000,000 sharesOutstanding  16,707,535 shares in 2009 and
2008 (after deducting treasury shares of
604,683 in 2009 and 2008) at
stated capital amount
    
    
    5,099
    
    
    
    5,099Retained earnings
    
    
    174,147
    
    
    
    171,312Accumulated other comprehensive loss
    
    
    (18,032
    )
    
    
    (17,823
    )The Gorman-Rupp Company shareholders equity
    
    
    161,214
    
    
    
    158,588Noncontrolling interest
    
    
    613
    
    
    
    618Total equity
    
    
    161,827
    
    
    
    159,206Total liabilities and shareholders equity
    
    $
    233,820
    
    
    $
    231,538
 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)
    
    2009
    
    
    2008Cash flows from operating activities:Net income
    
    $
    4,506
    
    
    $
    7,152Adjustments to reconcile net income attributable to
net cash provided by operating activities:Depreciation and amortization
    
    
    2,105
    
    
    
    1,935Changes in operating assets and liabilities
    
    
    4,196
    
    
    
    (3,668
    )Net cash provided by operating activities
    
    
    10,807
    
    
    
    5,419Cash flows from investing activities:Capital additions, net
    
    
    (9,034
    )
    
    
    (2,053
    )Proceeds from sale of product line assets
    
    
    1,105
    
    
    
    Change in short-term investments
    
    
    
    
    
    
    179Net cash used for investing activities
    
    
    (7,929
    )
    
    
    (1,874
    )Cash flows from financing activities:Cash dividends
    
    
    (1,671
    )
    
    
    (1,670
    )Proceeds from unsecured loan agreement
    
    
    5,671
    
    
    
    Net cash provided (used) for financing activities
    
    
    4,000
    
    
    
    (1,670
    )Effect of exchange rate changes on cash
    
    
    (195
    )
    
    
    (55
    )Net increase in cash
and cash equivalents
    
    
    6,683
    
    
    
    1,820Cash and cash equivalents:Beginning of year
    
    
    23,793
    
    
    
    24,604March 31,
    
    $
    30,476
    
    
    $
    26,424
 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
  NEW ACCOUNTING PRONOUNCEMENTS
 Fair Value Measurements (FAS 157),
 The Fair Value Option for Financial Assets and
Financial Liabilities-Including an Amendment of FAS 115 (FAS 159)
 Business Combinations (FAS 141(R)).
 Noncontrolling Interests in Consolidated Financial
Statements (FAS 160), an amendment of Accounting Research Bulletin No. 51, Consolidated Financial
Statements (ARB 51)
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PART I  CONTINUED
 ITEM 1.
    
    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)  CONTINUED
 NOTE A  BASIS OF PRESENTATION OF FINANCIAL STATEMENTS  CONTINUED
  NOTE B  INVENTORIES
   March 31,
    
    December 31,(Thousands of dollars)
    
    2009
    
    2008Raw materials and in-process
    
    $
    29,007
    
    
    $
    32,996Finished parts
    
    
    20,042
    
    
    
    20,288Finished products
    
    
    3,374
    
    
    
    3,597Total inventories
    
    $
    52,423
    
    
    $
    56,881
 NOTE C  PRODUCT WARRANTIES
  Three Months Ended(Thousands of dollars)
    
    March 31,2009
    
    2008Balance at beginning of year
    
    $
    2,048
    
    
    $
    1,682Warranty costs
    
    
    792
    
    
    
    683Settlements
    
    
    (804
    )
    
    
    (541
    )Balance at end of quarter
    
    $
    2,036
    
    
    $
    1,824
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PART I  CONTINUED
 ITEM 1.
    
    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)  CONTINUED
 NOTE D  COMPREHENSIVE INCOME
  Three Months Ended(Thousands of dollars)
    
    March 31,2009
    
    2008Net income
    
    $
    4,506
    
    
    $
    7,152Changes in cumulative foreign currency
translation adjustment
    
    
    (680
    )
    
    
    25Pension benefit adjustments
    
    
    470
    
    
    
    (367
    )Total comprehensive income
    
    $
    4,296
    
    
    $
    6,810
 NOTE E  INCOME TAXES
 Accounting for Uncertainty in Income
Taxes, Accounting for Income Taxes.
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PART I  CONTINUED
 ITEM 1.
    
    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)  CONTINUED
 NOTE E  INCOME TAXES  CONTINUED
  NOTE F  PENSION AND OTHER POSTRETIREMENT BENEFITS
    Pension Benefits
    
    Postretirement BenefitsThree Months Ended
    
    Three Months Ended(Thousands of dollars)
    
    March 31,
    
    March 31,2009
    
    2008
    
    2009
    
    2008Service cost
    
    $
    688
    
    
    $
    659
    
    
    $
    302
    
    
    $
    298Interest cost
    
    
    851
    
    
    
    764
    
    
    
    394
    
    
    
    416Expected return on plan assets
    
    
    (884
    )
    
    
    (1,048
    )
    
    
    
    
    
    
    Amortization of loss
    
    
    527
    
    
    
    170
    
    
    
    (56
    )
    
    
    Benefit cost
    
    $
    1,182
    
    
    $
    545
    
    
    $
    640
    
    
    $
    714
 
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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PART I  CONTINUED
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  CONTINUED
  First Quarter 2009 Compared to First Quarter 2008
 Net Sales
 Three Months Ended(Thousands of dollars)
        March 31,2009
    
    2008
    
    $ Change
    
    % ChangeNet sales
    
    $
    71,598
    
    
    $
    81,434
    
    
    $
    (9,836
    )
    
    
    (12.1
    )%
  Cost of Products Sold
 Three Months Ended(Thousands of dollars)
        March 31,2009
    
    2008
    
    $ Change
    
    % ChangeCost of products sold
    
    $
    56,253
    
    
    $
    61,590
    
    
    $
    (5,337
    )
    
    
    (8.7
    )%% of Net sales
    
    
    78.6
    %
    
    
    75.6
    %
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PART I  CONTINUED
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  CONTINUED
 Selling, General, and Administrative Expenses (SG&A)
 Three Months Ended(Thousands of dollars)
        March 31,2009
    
    2008
    
    $ Change
    
    % ChangeSelling, general, and
administrative
expenses (SG&A)
    
    $
    8,988
    
    
    $
    9,499
    
    
    $
    (511
    )
    
    
    (5.4
    )%% of Net sales
    
    
    12.6
    %
    
    
    11.7
    %
  Other Income
 Three Months Ended(Thousands of dollars)
        March 31,2009
    
    2008
    
    $ Change
    
    % ChangeOther income
    
    $
    765
    
    
    $
    616
    
    
    $
    149
    
    
    
    24.2
    %% of Net sales
    
    
    1.1
    %
    
    
    0.8
    %
  Net Income
 Three Months Ended(Thousands of dollars)
        March 31,2009
    
    2008
    
    $ Change
    
    % ChangeIncome before income taxes
    
    $
    6,868
    
    
    $
    10,888
    
    
    $
    (4,020
    )
    
    
    (36.9
    )%% of Net sales
    
    
    9.6
    %
    
    
    13.4
    %Income taxes
    
    $
    2,362
    
    
    $
    3,736
    
    
    $
    (1,374
    )
    
    
    (36.8
    )%Effective tax rate
    
    
    34.4
    %
    
    
    34.3
    %Net income
    
    $
    4,506
    
    
    $
    7,152
    
    
    $
    2,646
    
    
    
    (37.0
    )%% of Net sales
    
    
    6.3
    %
    
    
    8.8
    %Earnings per share
    
    $
    0.27
    
    
    $
    0.43
    
    
    $
    (0.16
    )
    
    
    (37.2
    )%
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PART I  CONTINUED
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  CONTINUED
 Liquidity and Sources of Capital
 Three Months Ended(Thousands of dollars)
        March 31,2009
    
    2008
    
    $ Change
    
    % ChangeNet cash provided by operating activities
    
    $
    10,807
    
    
    $
    5,419
    
    
    $
    5,388
    
    
    
    99.4
    %Net cash used for investing activities
    
    
    7,929
    
    
    
    1,874
    
    
    
    6,055
    
    
    
    323.1Net cash provided (used) for financing
activities
    
    
    4,000
    
    
    
    (1,670
    )
    
    
    5,670
    
    
    
    339.5
     
 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES OF MARKET RISK
  
 ITEM 4. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
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PART I  CONTINUED
 ITEM 4. CONTROLS AND PROCEDURES  CONTINUED
  Changes in Internal Control Over Financial Reporting
  
 PART II OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 1A. RISK FACTORS
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ITEM 6. EXHIBITS
 (a)
    
    Exhibits
      SIGNATURES
  The Gorman-Rupp Company
(Registrant)Date: April 28, 2009By:
    /s/ Wayne L. KnabelWayne L. KnabelVice President Finance 14