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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20459
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended August 31, 2007
 OR
 o
    
    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 0-288
 ROBBINS & MYERS, INC.
  Ohio
    
    31-0424220(State or other jurisdiction of 
incorporation)
    
    (I.R.S. employer
identification number)51 Plum St. Suite 260,
Dayton, OH
    
    45440(Address of principal executive offices)
    
    (Zip Code)
 Registrants telephone number, including area code
 (Former name or address, if changed since last report)
  Name of each exchange onTitle of each class
    
    which registeredCommon Shares, without par value
    
    New York
  o þ
 o þ
 þ o
 þ
  o þ o
 o þ
 Aggregate market value of Common Shares, without par
value, held by non-affiliates of the Company at February 28, 2007
(the last business day of the Companys second fiscal quarter)
    
    $
    544,766,998Number of Common Shares, without par value, outstanding
at October 31, 2007
    
    
    17,122,883
 DOCUMENT INCORPORATED BY REFERENCE




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TABLE OF CONTENTS  ITEM 1 BUSINESSITEM 1A. RISK FACTORSITEM 1B UNRESOLVED STAFF COMMENTSITEM 2. PROPERTIESITEM 3. LEGAL PROCEEDINGSITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSPART IIITEM 5.MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIESITEM 6. SELECTED FINANCIAL DATAITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATAITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSUREITEM 9A. CONTROLS AND PROCEDURESITEM 9B. OTHER INFORMATIONPART IIIITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT AND CORPORATE GOVERNANCEITEM 11. EXECUTIVE COMPENSATIONITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERSITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCEITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICESPART IVITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULESSIGNATURESEX-3.1EX-10.4EX-10.5EX-10.10EX-10.12EX-10.14EX-10.15EX-10.16EX-10.18EX-10.19EX-10.20EX-21.1EX-23.1EX-24.1EX-31.1EX-31.2EX-32.1EX-32.2    Table of Contents  
 ITEM 1. BUSINESS
 Important Information Regarding Forward-Looking Statements
     Fluid Management Segment
  Sales, Marketing and Distribution.
 Aftermarket Sales
 Markets and Competition.
 1




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Process Solutions Business Segment
  Sales, Marketing and Distribution.
 Aftermarket Sales.
 Markets and Competition.
 Romaco Business Segment
  Sales, Marketing and Distribution.
 Aftermarket Sales
 Markets and Competition.
 2




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Other Consolidated Information
                 3




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ITEM 1A. RISK FACTORS
  Some of our end-markets are cyclical, which may cause fluctuations in our sales and operating
results.
   Our businesses are adversely affected by economic downturns.
  Approximately 60% of our sales are to customers outside the United States, and we are subject to
special economic and political risks associated with international operations.
  We must comply with a variety of import and export laws and regulations, and the cost of compliance
as well as the consequences of failure to properly comply with such laws could adversely affect our
business.
  4




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Competition in our markets could cause our sales to decrease.
  The nature of our products creates the possibility of product liability lawsuits, which could harm
our business.
  The results of operations could vary based on the availability and cost of our raw materials.
   Our results of operations could vary as a result of the methods, estimates and judgments we use in
applying our accounting policies.
  Any impairment in the value of our intangible assets, including goodwill, would negatively affect
our operating results and total capitalization.
  5




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Other risks that may effect our business.
 
    
    Customer order cancellations.
    
    Implementation of business computer systems at several of our facilities.
 
 ITEM 1B UNRESOLVED STAFF COMMENTS
  6




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ITEM 2. PROPERTIES
  Square FootageSales/
    
    (in thousands)Manufacturing
    
    Service
    
    Owned
    
    LeasedFunction and size by segment:Fluid Management
    
    
    11
    
    
    
    13
    
    
    
    757
    
    
    
    91Process Solutions
    
    
    13
    
    
    
    
    
    
    
    2,096
    
    
    
    50Romaco
    
    
    5
    
    
    
    2
    
    
    
    284
    
    
    
    75
 North America
    
    South America
    
    Europe
    
    AsiaGeographical locations by segment:Fluid Management
    
    
    20
    
    
    
    2
    
    
    
    1
    
    
    
    1Process Solutions
    
    
    5
    
    
    
    1
    
    
    
    5
    
    
    
    2Romaco
    
    
    1
    
    
    
    
    
    
    
    6
    
    
    
    
 
 ITEM 3. LEGAL PROCEEDINGS
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  7




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Executive Officers of the Registrant
          8




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PART II
 
 ITEM 5.
    
    MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES
  DividendsHigh
    
    
    Low
    
    
    Paid per ShareFiscal 20071st Quarter ended Nov. 30, 2006
    
    $
    42.79
    
    
    $
    27.96
    
    
    $
    0.0552nd Quarter ended Feb. 28, 2007
    
    
    47.21
    
    
    
    39.15
    
    
    
    0.0653rd Quarter ended May 31, 2007
    
    
    46.13
    
    
    
    34.95
    
    
    
    0.0654th Quarter ended Aug. 31, 2007
    
    
    61.93
    
    
    
    42.35
    
    
    
    0.065Fiscal 20061st Quarter ended Nov. 30, 2005
    
    $
    23.06
    
    
    $
    19.98
    
    
    $
    0.0552nd Quarter ended Feb. 28, 2006
    
    
    23.58
    
    
    
    20.21
    
    
    
    0.0553rd Quarter ended May 31, 2006
    
    
    25.37
    
    
    
    20.12
    
    
    
    0.0554th Quarter ended Aug. 31, 2006
    
    
    29.03
    
    
    
    22.61
    
    
    
    0.055
     MaximumNumber (or)ApproximateTotal Number of
    
    
    DollarShares
    
    
    Value of SharesPurchased as
    
    
    that MayAverage
    
    
    Part of Publicly
    
    
    Yet BeTotal Number
    
    
    Price
    
    
    Announced
    
    
    Purchased Underof Shares
    
    
    Paid per
    
    
    Plans or
    
    
    the Plans orPeriod
    
    Purchased(a)
    
    
    Share
    
    
    Programs
    
    
    ProgramsJune 2007
    
    
    0
    
    
    $
    0
    
    
    
    0
    
    
    
    0July 2007
    
    
    1,860
    
    
    
    60.89
    
    
    
    0
    
    
    
    0August 2007
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Total
    
    
    1,860
    
    
    $
    60.89
    
    
    
    0
    
    
    
    0
 
 (a)
    
    During the fourth quarter of 2007, the Company purchased 1,860 of its common shares in connection with its employee benefit plans,
including purchases associated with the vesting of restricted stock awards. These purchases were not made pursuant to a publicly
announced repurchase plan or program. 9




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ITEM 6. SELECTED FINANCIAL DATA
 Selected Financial Data (1)
  2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Operating ResultsOrders
    
    $
    719,848
    
    
    $
    688,822
    
    
    $
    607,210
    
    
    $
    586,948
    
    
    $
    546,357Ending backlog
    
    
    193,821
    
    
    
    174,447
    
    
    
    116,491
    
    
    
    114,267
    
    
    
    111,375Sales
    
    
    695,393
    
    
    
    625,389
    
    
    
    604,773
    
    
    
    585,758
    
    
    
    560,775EBIT (2,3)
    
    
    94,282
    
    
    
    7,508
    
    
    
    21,451
    
    
    
    30,317
    
    
    
    38,709Net income (loss) (2,3)
    
    
    50,705
    
    
    
    (19,587
    )
    
    
    (262
    )
    
    
    11,648
    
    
    
    14,623Net income (loss) per share, diluted (2,3)
    
    $
    2.96
    
    
    $
    (1.31
    )
    
    $
    (0.02
    )
    
    $
    0.80
    
    
    $
    1.02Financial ConditionTotal assets
    
    $
    816,143
    
    
    $
    712,047
    
    
    $
    740,193
    
    
    $
    736,078
    
    
    $
    705,491Total cash
    
    
    116,110
    
    
    
    48,365
    
    
    
    23,043
    
    
    
    8,640
    
    
    
    12,347Total debt
    
    
    103,075
    
    
    
    105,531
    
    
    
    175,408
    
    
    
    181,702
    
    
    
    193,603Shareholders equity
    
    
    412,518
    
    
    
    339,422
    
    
    
    301,646
    
    
    
    306,025
    
    
    
    286,916Total capitalization
    
    $
    515,593
    
    
    $
    444,953
    
    
    $
    477,054
    
    
    $
    487,727
    
    
    $
    480,519Other DataCash flow from operating activities (2)
    
    $
    65,113
    
    
    $
    40,581
    
    
    $
    26,340
    
    
    $
    26,353
    
    
    $
    45,636Capital expenditures, net
    
    
    16,536
    
    
    
    13,660
    
    
    
    20,263
    
    
    
    9,884
    
    
    
    7,869Amortization
    
    
    1,631
    
    
    
    2,343
    
    
    
    2,519
    
    
    
    2,738
    
    
    
    2,189Depreciation
    
    
    14,993
    
    
    
    16,235
    
    
    
    17,874
    
    
    
    18,639
    
    
    
    20,093Dividends declared per share
    
    $
    0.25
    
    
    $
    0.22
    
    
    $
    0.22
    
    
    $
    0.22
    
    
    $
    0.22Number of employees
    
    
    3,233
    
    
    
    3,271
    
    
    
    3,585
    
    
    
    3,824
    
    
    
    3,904
 10




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11




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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
 Overview
        12




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Results of Operations
  Consolidated
    
    2007
    
    
    2006
    
    
    2005Sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of sales
    
    
    65.2
    
    
    
    65.6
    
    
    
    68.0Gross profit
    
    
    34.8
    
    
    
    34.4
    
    
    
    32.0SG&A expenses
    
    
    21.7
    
    
    
    27.2
    
    
    
    27.0Goodwill impairment charge
    
    
    0.0
    
    
    
    6.3
    
    
    
    0.0Other
    
    
    (.5
    )
    
    
    (.3
    )
    
    
    1.5EBIT
    
    
    13.6
    %
    
    
    1.2
    %
    
    
    3.5
    %
 By Segment
    
    2007
    
    
    2006
    
    
    2005(In millions, except percents)Fluid Management:Sales
    
    $
    292.3
    
    
    $
    245.2
    
    
    $
    198.7EBIT
    
    
    77.0
    
    
    
    56.5
    
    
    
    39.7EBIT %
    
    
    26.3
    %
    
    
    23.0
    %
    
    
    20.0
    %Process Solutions:Sales
    
    $
    273.9
    
    
    $
    231.0
    
    
    $
    238.7EBIT
    
    
    31.9
    
    
    
    8.9
    
    
    
    4.7EBIT %
    
    
    11.7
    %
    
    
    3.9
    %
    
    
    2.0
    %Romaco:Sales
    
    $
    129.2
    
    
    $
    149.2
    
    
    $
    167.4EBIT
    
    
    2.6
    
    
    
    (38.2
    )
    
    
    (7.9
    )EBIT %
    
    
    2.0
    %
    
    
    (25.6
    )%
    
    
    (4.7
    )%Total:Sales
    
    $
    695.4
    
    
    $
    625.4
    
    
    $
    604.8EBIT
    
    
    94.3
    
    
    
    7.5
    
    
    
    21.5EBIT %
    
    
    13.6
    %
    
    
    1.2
    %
    
    
    3.6
    %
 Fiscal Year Ended August 31, 2007 Compared with Fiscal Year Ended August 31, 2006
 Net Sales
     13




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Earnings Before Interest and Income Taxes (EBIT)
      14




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Interest expense
  Income taxes
  Net Income
  15




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Fiscal Year Ended August 31, 2006 Compared with Fiscal Year Ended August 31, 2005
 Net Sales
     Earnings Before Interest and Income Taxes (EBIT)
     16




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Interest expense
  Income taxes
  Net loss
  17




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Liquidity and Capital Resources
 Operating Activities
   Investing Activities
   Financing Activities
  Credit Agreement
  18




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Critical Accounting Policies and Estimates
  Revenue Recognition
  Use of Estimates
       Goodwill
  19




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Foreign Currency Accounting
   Pensions
     New Accounting Pronouncement
   20




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21




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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
     22




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U.S. Dollar
    
    
    U.S. Dollar
    
    
    Non-U.S. DollarFixed Rate
    
    
    Variable Rate
    
    
    Variable RateMaturity Date
    
    Amount
    
    
    Rate
    
    
    Amount
    
    
    Rate
    
    
    Amount
    
    
    Rate2008
    
    $
    40,000
    
    
    
    6.76
    %
    
    $
    30,000
    
    
    
    6.50
    %
    
    $
    2,522
    
    
    
    8.75
    %2009
    
    
    0
    
    
    
    0.00
    
    
    
    0
    
    
    
    0.00
    
    
    
    553
    
    
    
    5.002010
    
    
    30,000
    
    
    
    6.84
    
    
    
    0
    
    
    
    0.00
    
    
    
    0
    
    
    
    0.002011
    
    
    0
    
    
    
    0.00
    
    
    
    0
    
    
    
    0.00
    
    
    
    0
    
    
    
    0.002012
    
    
    0
    
    
    
    0.00
    
    
    
    0
    
    
    
    0.00
    
    
    
    0
    
    
    
    0.00Thereafter
    
    
    0
    
    
    
    0.00
    
    
    
    0
    
    
    
    0.00
    
    
    
    0
    
    
    
    0.00Total
    
    $
    70,000
    
    
    
    6.79
    %
    
    $
    30,000
    
    
    
    6.50
    %
    
    $
    3,075
    
    
    
    8.30
    %Fair value
    
    $
    71,500
    
    
    
    
    
    
    $
    30,600
    
    
    
    
    
    
    $
    3,075
  Payments Due by PeriodTwo toLong-term contractual
    
    
    
    
    
    One year
    
    
    three
    
    
    Four to
    
    
    After fiveobligations
    
    Total
    
    
    or less
    
    
    years
    
    
    five years
    
    
    years(In thousands)Debt obligations
    
    $
    103,075
    
    
    $
    72,522
    
    
    $
    30,553
    
    
    $
    0
    
    
    $
    0Capital lease obligations
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Operating leases (1)
    
    
    9,544
    
    
    
    3,000
    
    
    
    4,382
    
    
    
    1,912
    
    
    
    250Unconditional purchase
obligations
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Total contractual cash
obligations
    
    $
    112,619
    
    
    $
    75,522
    
    
    $
    34,935
    
    
    $
    1,912
    
    
    $
    250
 
 (1)
    
    Operating leases consist primarily of building and equipment leases.  23




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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 Report of Independent Registered Public Accounting Firm
 
     .
  
 24




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Report of Independent Registered Public Accounting Firm
 
      
 25




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CONSOLIDATED BALANCE SHEET
 August 31,2007
    
    
    2006ASSETSCurrent Assets:Cash and cash equivalents
    
    $
    116,110
    
    
    $
    48,365Accounts receivable
    
    
    152,779
    
    
    
    124,569Inventories
    
    
    99,196
    
    
    
    94,990Other current assets
    
    
    7,410
    
    
    
    6,260Deferred taxes
    
    
    11,178
    
    
    
    11,318Total Current Assets
    
    
    386,673
    
    
    
    285,502Goodwill
    
    
    271,150
    
    
    
    262,327Other Intangible Assets
    
    
    7,272
    
    
    
    11,507Deferred Taxes
    
    
    9,583
    
    
    
    11,300Other Assets
    
    
    12,196
    
    
    
    14,381Property, Plant and Equipment
    
    
    129,269
    
    
    
    127,030$
    816,143
    
    
    $
    712,047LIABILITIES AND SHAREHOLDERS EQUITYCurrent Liabilities:Accounts payable
    
    $
    78,890
    
    
    $
    62,749Accrued expenses
    
    
    103,732
    
    
    
    102,327Deferred taxes
    
    
    1,662
    
    
    
    2,263Current portion of long-term debt
    
    
    72,522
    
    
    
    744Total Current Liabilities
    
    
    256,806
    
    
    
    168,083Long-Term Debt, Less Current Portion
    
    
    30,553
    
    
    
    104,787Deferred Taxes
    
    
    24,818
    
    
    
    12,738Other Long-Term Liabilities
    
    
    79,019
    
    
    
    75,324Minority Interest
    
    
    12,429
    
    
    
    11,693Shareholders Equity:Common stock-without par value:Authorized shares-40,000,000Issued shares-17,137,755 in 2007 (16,708,286 in 2006)
    
    
    172,319
    
    
    
    157,528Treasury shares-14,806 in 2007 (308 in 2006)
    
    
    (683
    )
    
    
    (10
    )Retained earnings
    
    
    217,548
    
    
    
    171,096Accumulated other comprehensive income:Foreign currency translation
    
    
    40,024
    
    
    
    25,874Pension liability
    
    
    (16,690
    )
    
    
    (15,066
    )Total
    
    
    23,334
    
    
    
    10,808412,518
    
    
    
    339,422$
    816,143
    
    
    $
    712,047
  26




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CONSOLIDATED SHAREHOLDERS EQUITY STATEMENT
 Unearned
    
    
    
    
    
    
    AccumulatedCompensation
    
    
    
    
    
    
    Otheron Restricted
    
    
    
    
    
    
    ComprehensiveCommon
    
    
    Treasury
    
    
    Stock
    
    
    Retained
    
    
    IncomeShares
    
    
    Shares
    
    
    Grants
    
    
    Earnings
    
    
    (Loss)
    
    
    TotalBalance at September 1, 2004
    
    $
    106,985
    
    
    $
    (10
    )
    
    $
    0
    
    
    $
    197,443
    
    
    $
    1,607
    
    
    $
    306,025Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (262
    )
    
    
    
    
    
    
    (262
    )Change in foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    675
    
    
    
    675Change in minimum pension liability
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,743
    )
    
    
    (4,743
    )Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,330
    )Restricted stock grants, 20,922 shares
    
    
    452
    
    
    
    
    
    
    
    (452
    )
    
    
    
    
    
    
    
    
    
    
    0Amortization of restricted stock grants
    
    
    
    
    
    
    
    
    
    
    310
    
    
    
    
    
    
    
    
    
    
    
    310Cash dividend declared, $0.22 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,213
    )
    
    
    
    
    
    
    (3,213
    )Stock options exercised, 73,000 shares
    
    
    1,440
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,440Proceeds from share sales, 47,705 shares
    
    
    1,052
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,052Performance stock award expense
    
    
    250
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    250Tax benefit of stock options exercised
    
    
    112
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    112Balance at August 31, 2005
    
    
    110,291
    
    
    
    (10
    )
    
    
    (142
    )
    
    
    193,968
    
    
    
    (2,461
    )
    
    
    301,646Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19,587
    )
    
    
    
    
    
    
    (19,587
    )Change in foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,050
    
    
    
    8,050Change in minimum pension liability
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,219
    
    
    
    5,219Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,318
    )Adoption of SFAS No. 123-R
    
    
    (142
    )
    
    
    
    
    
    
    142Restricted stock grants, 58,576 sharesAmortization of restricted stock grants
    
    
    485
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    485Cash dividend declared, $0.22 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,285
    )
    
    
    
    
    
    
    (3,285
    )Stock options exercised, 207,069 shares
    
    
    4,658
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,658Proceeds from share sales, 44,630 shares
    
    
    1,009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,009Stock option expense
    
    
    837
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    837Performance stock award expense
    
    
    445
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    445Conversion of bonds to stock, 1,729,524
shares
    
    
    38,914
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    38,914Convertible bonds interest adjustment,
net of tax of $508
    
    
    828
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    828Tax benefit of stock options exercised
    
    
    203
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    203Balance at August 31, 2006
    
    
    157,528
    
    
    
    (10
    )
    

 
    0
    
    
    
    171,096
    
    
    
    10,808
    
    
    
    339,422Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    50,705
    
    
    
    
    
    
    
    50,705Change in foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,160
    
    
    
    14,160Change in minimum pension liability
(SFAS No.87), net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,621
    
    
    
    8,621Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    73,486Adjustment related to adoption of SFAS
No. 158, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,255
    )
    
    
    (10,255
    )Restricted stock grants-net, 60,704
sharesAmortization of restricted stock grants
    
    
    1,247
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,247Cash dividend declared, $0.25 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,253
    )
    
    
    
    
    
    
    (4,253
    )Stock options exercised, 343,668 shares
    
    
    9,066
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,066Proceeds from share sales, 25,097 shares
    
    
    825
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    825Treasury stock purchases, 14,498 shares
    
    
    
    
    
    
    (673
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (673
    )Stock option expense
    
    
    598
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    598Performance stock award expense
    
    
    924
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    924Tax benefit of stock options exercised
    
    
    2,131
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,131Balance at August 31, 2007
    
    $
    172,319
    
    
    $
    (683
    )
    
    $
    0
    
    
    $
    217,548
    
    
    $
    23,334
    
    
    $
    412,518
  27




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##### Table of Contents



CONSOLIDATED STATEMENT OF OPERATIONS
 Years ended August 31,2007
    
    
    2006
    
    
    2005Sales
    
    $
    695,393
    
    
    $
    625,389
    
    
    $
    604,773Cost of sales
    
    
    453,052
    
    
    
    410,473
    
    
    
    408,808Gross profit
    
    
    242,341
    
    
    
    214,916
    
    
    
    195,965Selling, general and administrative expenses
    
    
    151,520
    
    
    
    170,020
    
    
    
    165,628Goodwill impairment charge
    
    
    0
    
    
    
    39,174
    
    
    
    0Other (income) expense
    
    
    (3,461
    )
    
    
    (1,786
    )
    
    
    8,886Income before interest and income taxes
    
    
    94,282
    
    
    
    7,508
    
    
    
    21,451Interest expense
    
    
    5,243
    
    
    
    12,946
    
    
    
    14,433Income (loss) before income taxes and minority interest
    
    
    89,039
    
    
    
    (5,438
    )
    
    
    7,018Income tax expense
    
    
    36,866
    
    
    
    12,589
    
    
    
    5,840Minority interest
    
    
    1,468
    
    
    
    1,560
    
    
    
    1,440Net income (loss)
    
    $
    50,705
    
    
    $
    (19,587
    )
    
    $
    (262
    )Net income (loss) per shareBasic
    
    $
    2.98
    
    
    $
    (1.31
    )
    
    $
    (0.02
    )Diluted
    
    $
    2.96
    
    
    $
    (1.31
    )
    
    $
    (0.02
    )
  28




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##### Table of Contents



CONSOLIDATED CASH FLOW STATEMENT
 Years Ended August 31,2007
    
    
    2006
    
    
    2005OPERATING ACTIVITIESNet income (loss)
    
    $
    50,705
    
    
    $
    (19,587
    )
    
    $
    (262
    )Adjustments to reconcile net income (loss) to net cash
and cash equivalents provided by operating activities:Depreciation
    
    
    14,993
    
    
    
    16,235
    
    
    
    17,874Amortization
    
    
    1,631
    
    
    
    2,343
    
    
    
    2,519Deferred taxes
    
    
    18,997
    
    
    
    (2,887
    )
    
    
    1,234Stock compensation
    
    
    2,769
    
    
    
    1,767
    
    
    
    702Goodwill impairment charge
    
    
    0
    
    
    
    39,174
    
    
    
    0Net (gain) loss on sale of business/facilities
    
    
    (5,279
    )
    
    
    (7,955
    )
    
    
    2,053Changes in operating assets and liabilities :Accounts receivable
    
    
    (28,315
    )
    
    
    6,125
    
    
    
    3,380Inventories
    
    
    (2,796
    )
    
    
    2,905
    
    
    
    1,819Other assets
    
    
    1,059
    
    
    
    1,933
    
    
    
    (3,948
    )Accounts payable
    
    
    16,500
    
    
    
    (5,468
    )
    
    
    4,978Accrued expenses and other liabilities
    
    
    (5,151
    )
    
    
    5,996
    
    
    
    (4,009
    )Net cash and cash equivalents provided by operating activities
    
    
    65,113
    
    
    
    40,581
    
    
    
    26,340INVESTING ACTIVITIESCapital expenditures
    
    
    (16,536
    )
    
    
    (13,660
    )
    
    
    (20,263
    )Proceeds from sale of business/facilities
    
    
    13,712
    
    
    
    27,833
    
    
    
    15,798Net cash and cash equivalents (used) provided by investing activities
    
    
    (2,824
    )
    
    
    14,173
    
    
    
    (4,465
    )FINANCING ACTIVITIESProceeds from debt borrowings
    
    
    30,904
    
    
    
    35,747
    
    
    
    104,876Payments of long-term debt
    
    
    (33,360
    )
    
    
    (66,953
    )
    
    
    (111,840
    )Proceeds from issuance of common stock, including stock option tax benefits
    
    
    11,348
    
    
    
    5,667
    
    
    
    2,492Dividend paid
    
    
    (4,253
    )
    
    
    (3,285
    )
    
    
    (3,213
    )Other
    
    
    (432
    )
    
    
    (528
    )
    
    
    (262
    )Net cash and cash equivalents provided (used) by financing activities
    
    
    4,207
    
    
    
    (29,352
    )
    
    
    (7,947
    )Effect of exchange rate changes on cash
    
    
    1,249
    
    
    
    (80
    )
    
    
    475Increase in cash and cash equivalents
    
    
    67,745
    
    
    
    25,322
    
    
    
    14,403Cash and cash equivalents at beginning of year
    
    
    48,365
    
    
    
    23,043
    
    
    
    8,640Cash and cash equivalents at end of year
    
    $
    116,110
    
    
    $
    48,365
    
    
    $
    23,043
  29




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 1  SUMMARY OF ACCOUNTING POLICIES
 Consolidation
  Use of Estimates
  Accounts Receivable
   Inventories
  Goodwill and Other Intangible Assets
   Patents and trademarks
    
    14 to 17 yearsNon-compete agreements
    
    3 to 5 yearsFinancing costs
    
    3 to 5 years
 Property, Plant and Equipment
  Buildings
    
    45 yearsMachinery and equipment
    
    3 to 15 years
 30




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##### Table of Contents



Foreign Currency Accounting
  Product Warranties
   2007
    
    
    2006(In thousands)Balance at beginning of the fiscal year
    
    $
    7,605
    
    
    $
    9,176Warranty expense
    
    
    2,188
    
    
    
    3,134Deductions
    
    
    (1,780
    )
    
    
    (3,734
    )Impact of business dispositions
    
    
    (91
    )
    
    
    (971
    )Balance at end of the fiscal year
    
    $
    7,922
    
    
    $
    7,605
 Consolidated Statement of Operations
  Revenue Recognition
  Income Taxes
  Accounting for Income Taxes
 31




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##### Table of Contents



Consolidated Cash Flow Statement
  Fair Value of Financial Instruments
     Common Stock Plans
 Accounting for Stock Issued to Employees Accounting for
Stock-Based Compensation Share-Based Payments
   2007
    
    2006Expected volatility of common stock
    
    
    25.40
    %
    
    
    32.70
    %Risk free interest rate
    
    
    4.80
    
    
    
    4.29Dividend yield
    
    
    0.70
    
    
    
    0.76Expected life of option
    

7.0 Yrs.
    

7.0 yrs.Fair value at grant date
    
    $
    11.59
    
    
    $
    8.81
 32




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##### Table of Contents



Year EndedAugust 31,2005(In thousands,except per shareamounts)Net loss, as reported
    
    $
    (262
    )Deduct:
Total Stock-based employee compensation expense determined under fair value based method for all awards, net of related tax effects
    
    
    1,005Pro-forma net loss
    
    $
    (1,267
    )Loss per share:Basicas reported
    
    $
    (0.02
    )Basicpro-forma
    
    $
    (0.09
    )Dilutedas reported
    
    $
    (0.02
    )Dilutedpro-forma
    
    $
    (0.09
    )
  Derivatives and Hedging Activities
  New Accounting Pronouncement
    33




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##### Table of Contents



Reclassifications
  34




---



##### Table of Contents



NOTE 2  BALANCE SHEET INFORMATION
 2007
    
    
    2006(In thousands)Accounts receivableAllowances for doubtful accounts
    
    $
    6,189
    
    
    $
    6,860InventoriesFIFO:Finished products
    
    $
    30,190
    
    
    $
    30,501Work in process
    
    
    39,699
    
    
    
    34,326Raw materials
    
    
    38,932
    
    
    
    37,549108,821
    
    
    
    102,376LIFO reserve, U.S. inventories
    
    
    (9,625
    )
    
    
    (7,386
    )$
    99,196
    
    
    $
    94,990Non-U.S. inventories at FIFO
    
    $
    69,432
    
    
    $
    68,372Property, plant and equipmentLand
    
    $
    17,795
    
    
    $
    17,395Buildings
    
    
    93,332
    
    
    
    93,212Machinery and equipment
    
    
    169,456
    
    
    
    160,423280,583
    
    
    
    271,030Less accumulated depreciation
    
    
    151,314
    
    
    
    144,000$
    129,269
    
    
    $
    127,030Accrued expensesSalaries, wages and payroll taxes
    
    $
    21,595
    
    
    $
    21,089Customer advances
    
    
    33,091
    
    
    
    24,583Pension benefits
    
    
    2,714
    
    
    
    7,894U.S. other postretirement benefits
    
    
    2,261
    
    
    
    2,472Warranty costs
    
    
    7,922
    
    
    
    7,605Accrued interest
    
    
    3,461
    
    
    
    2,935Income taxes
    
    
    9,517
    
    
    
    7,436Commissions
    
    
    4,507
    
    
    
    2,844Other
    
    
    18,664
    
    
    
    25,469$
    103,732
    
    
    $
    102,327Other long-term liabilitiesGerman pension liability
    
    $
    39,513
    
    
    $
    38,368U.S. other postretirement benefits
    
    
    20,218
    
    
    
    11,641U.S. pension liability
    
    
    7,699
    
    
    
    13,539Other
    
    
    10,589
    
    
    
    11,776$
    78,019
    
    
    $
    75,324
 35




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##### Table of Contents



NOTE 3  STATEMENT OF OPERATIONS INFORMATION
   2007
    
    
    2006
    
    
    2005In thousandsProcess Solutions segment restructuring costs
    
    $
    0
    
    
    $
    2,541
    
    
    $
    3,684Romaco Segment restructuring costs
    
    
    1,818
    
    
    
    4,755
    
    
    
    4,279(Gain) loss on disposition of product lines/facilities
    
    
    (5,279
    )
    
    
    (7,955
    )
    
    
    2,053Total restructuring and other costs
    
    
    (3,461
    )
    
    
    (659
    )
    
    
    10,016Less inventory write-down included in cost of sales
    
    
    0
    
    
    
    (1,127
    )
    
    
    (1,130
    )Other (income) expense
    
    $
    (3,461
    )
    
    $
    (1,786
    )
    
    $
    8,886
     36




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##### Table of Contents



2007
    
    
    2006(In thousands)Balance at beginning of fiscal year
    
    $
    1,755
    
    
    $
    1,074Payments made
    
    
    (1,497
    )
    
    
    (5,238
    )Costs incurred
    
    
    0
    
    
    
    5,919Balance at end of fiscal year
    
    $
    258
    
    
    $
    1,755
 Minimum
lease payments
  (In thousands)2008
    
    $
    3,0002009
    
    
    2,5492010
    
    
    1,8332011
    
    
    1,2162012
    
    
    696Thereafter
    
    
    250$
    9,544
  37




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##### Table of Contents



NOTE 4  PRODUCT LINE DISPOSITIONS
   NOTE 5  CASH FLOW STATEMENT INFORMATION
     2007
    
    
    2006
    
    
    2005(in thousands)Interest paid
    
    $
    7,952
    
    
    $
    13,078
    
    
    $
    14,252Taxes paid, net of refunds
    
    
    19,560
    
    
    
    13,399
    
    
    
    7,811
 38




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##### Table of Contents



NOTE 6GOODWILL AND OTHER INTANGIBLE ASSETS
  Process
    
    
    FluidSolutions
    
    
    Management
    
    
    RomacoSegment
    
    
    Segment
    
    
    Segment
    
    
    Total(In thousands)Balance as of September 1, 2005
    
    $
    141,970
    
    
    $
    104,653
    
    
    $
    62,658
    
    
    $
    309,281Goodwill reduction from utilizing
purchased tax loss carryforwards
and deferred tax assets
    
    
    0
    
    
    
    0
    
    
    
    (1,859
    )
    
    
    (1,859
    )Goodwill reduction from change in
opening balance sheet tax accrual
    
    
    0
    
    
    
    0
    
    
    
    (3,632
    )
    
    
    (3,632
    )Goodwill reduction due to business
dispositions
    
    
    0
    
    
    
    0
    
    
    
    (7,165
    )
    
    
    (7,165
    )Goodwill written off during the
period
    
    
    0
    
    
    
    0
    
    
    
    (39,174
    )
    
    
    (39,174
    )Translation adjustments and other
    
    
    3,105
    
    
    
    1,634
    
    
    
    137
    
    
    
    4,876Balance as of August 31, 2006
    
    
    145,075
    
    
    
    106,287
    
    
    
    10,965
    
    
    
    262,327Goodwill reduction from utilizing
purchased tax loss carryforwards
and deferred tax assets
    
    
    0
    
    
    
    0
    
    
    
    (1,052
    )
    
    
    (1,052
    )Goodwill reduction due to business
dispositions
    
    
    0
    
    
    
    0
    
    
    
    (250
    )
    
    
    (250
    )Translation adjustments and other
    
    
    8,114
    
    
    
    1,281
    
    
    
    730
    
    
    
    10,105Balance as of August 31, 2007
    
    $
    153,189
    
    
    $
    107,568
    
    
    $
    10,393
    
    
    $
    271,150
   2007
    
    
    2006Accumulated
    
    
    
    
    
    
    
    
    
    
    AccumulatedCarrying Amount
    
    
    Amortization
    
    
    Net
    
    
    Carrying Amount
    
    
    Amortization
    
    
    Net(In thousands)Patents and trademarks
    
    $
    11,378
    
    
    $
    7,093
    
    
    $
    4,285
    
    
    $
    10,176
    
    
    $
    6,767
    
    
    $
    3,409Non-compete agreements
    
    
    8,879
    
    
    
    7,009
    
    
    
    1,870
    
    
    
    8,832
    
    
    
    6,667
    
    
    
    2,165Financing costs
    
    
    9,559
    
    
    
    8,571
    
    
    
    988
    
    
    
    9,195
    
    
    
    7,783
    
    
    
    1,412Pension intangible
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    4,361
    
    
    
    0
    
    
    
    4,361Other
    
    
    5,201
    
    
    
    5,072
    
    
    
    129
    
    
    
    5,160
    
    
    
    5,000
    
    
    
    160$
    35,017
    
    
    $
    27,745
    
    
    $
    7,272
    
    
    $
    37,724
    
    
    $
    26,217
    
    
    $
    11,507
  39




---



##### Table of Contents



NOTE 7  LONG-TERM DEBT
 2007
    
    
    2006(in thousands)Senior debt:Revolving credit loan
    
    $
    0
    
    
    $
    0Senior notes
    
    
    100,000
    
    
    
    100,000Other
    
    
    3,075
    
    
    
    5,531Total debt
    
    
    103,075
    
    
    
    105,531Less current portion
    
    
    (72,522
    )
    
    
    (744
    )Long-term debt
    
    $
    30,553
    
    
    $
    104,787
      40




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##### Table of Contents



(In thousands)2008
    
    $
    72,5222009
    
    
    5532010
    
    
    30,0002011
    
    
    02012
    
    
    02013 and thereafter
    
    
    0Total
    
    $
    103,075
 NOTE 8  RETIREMENT BENEFITS
  Prior to
    
    
    
    
    
    AfterAdopting
    
    
    
    
    
    Application ofSFAS No. 158
    
    Adjustments
    
    SFAS No. 158Other intangible assets
    
    $
    11,682
    
    
    $
    (4,410
    )
    
    $
    7,272Accrued expenses
    
    
    108,731
    
    
    
    (4,999
    )
    
    
    103,732Long-term deferred tax liability
    
    
    30,479
    
    
    
    (5,661
    )
    
    
    24,818Other long-term liabilities
    
    
    62,514
    
    
    
    16,505
    
    
    
    79,019Accumulated other comprehensive income
    
    
    33,589
    
    
    
    (10,255
    )
    
    
    23,334
    41




---



##### Table of Contents



Pension Benefits2007
    
    
    2006
    
    
    2005(In thousands)Service costs
    
    $
    2,017
    
    
    $
    2,855
    
    
    $
    4,116Interest cost
    
    
    8,812
    
    
    
    8,246
    
    
    
    8,402Expected return on plan assets
    
    
    (7,218
    )
    
    
    (7,340
    )
    
    
    (6,648
    )FAS 88 curtailment cost
    
    
    0
    
    
    
    (220
    )
    
    
    0Amortization of prior service cost
    
    
    695
    
    
    
    798
    
    
    
    755Amortization of transition obligation
    
    
    0
    
    
    
    (198
    )
    
    
    (186
    )Recognized net actuarial losses
    
    
    1,578
    
    
    
    2,100
    
    
    
    1,770Net periodic benefit cost
    
    $
    5,884
    
    
    $
    6,241
    
    
    $
    8,209Defined contribution cost
    
    $
    2,777
    
    
    $
    1,982
    
    
    $
    1,181
 Other Benefits2007
    
    
    2006
    
    
    2005(In thousands)Service cost
    
    $
    324
    
    
    $
    367
    
    
    $
    352Interest cost
    
    
    1,346
    
    
    
    1,271
    
    
    
    1,484Net amortization
    
    
    765
    
    
    
    920
    
    
    
    979Net peridoc benefit cost
    
    $
    2,435
    
    
    $
    2,558
    
    
    $
    2,815
 42




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##### Table of Contents



Pension Benefits
    
    
    Other Benefits2007
    
    
    2006
    
    
    2007
    
    
    2006(In thousands)Change in benefit obligation:Beginning of year
    
    $
    163,953
    
    
    $
    168,913
    
    
    $
    23,244
    
    
    $
    26,848Service cost
    
    
    2,315
    
    
    
    2,855
    
    
    
    324
    
    
    
    367Interest cost
    
    
    8,954
    
    
    
    8,246
    
    
    
    1,346
    
    
    
    1,271Curtailment
    
    
    0
    
    
    
    (2,031
    )
    
    
    0
    
    
    
    0Currency exchange rate impact
    
    
    4,760
    
    
    
    3,973
    
    
    
    0
    
    
    
    0Actuarial gains
    
    
    (11,293
    )
    
    
    (2,540
    )
    
    
    (192
    )
    
    
    (2,835
    )Benefit payments
    
    
    (11,603
    )
    
    
    (15,463
    )
    
    
    (2,243
    )
    
    
    (2,407
    )End of year
    
    $
    157,086
    
    
    $
    163,953
    
    
    $
    22,479
    
    
    $
    23,244Change in plan assets:Beginning of year
    
    $
    95,909
    
    
    $
    93,110
    
    
    $
    0
    
    
    $
    0Currency exchange rate impact
    
    
    1,523
    
    
    
    1,442
    
    
    
    0
    
    
    
    0Actual return
    
    
    14,299
    
    
    
    7,792
    
    
    
    0
    
    
    
    0Company contributions
    
    
    7,032
    
    
    
    9,028
    
    
    
    2,243
    
    
    
    2,407Benefit payments
    
    
    (11,603
    )
    
    
    (15,463
    )
    
    
    (2,243
    )
    
    
    (2,407
    )End of year
    
    $
    107,160
    
    
    $
    95,909
    
    
    $
    0
    
    
    $
    0Funded status
    
    $
    (49,926
    )
    
    $
    (68,044
    )
    
    $
    (22,479
    )
    
    $
    (23,244
    )Unrecognized net actuarial losses
    
    
    0
    
    
    
    34,769
    
    
    
    0
    
    
    
    7,475Unamortized prior service cost
    
    
    0
    
    
    
    3,303
    
    
    
    0
    
    
    
    1,656Accrued benefit cost
    
    $
    (49,926
    )
    
    $
    (29,972
    )
    
    $
    (22,479
    )
    
    $
    (14,113
    )Recorded as follows:Accrued expenses
    
    $
    (2,714
    )
    
    $
    (7,894
    )
    
    $
    (2,261
    )
    
    $
    (2,472
    )Other long-term liabilities
    
    
    (47,212
    )
    
    
    (51,907
    )
    
    
    (20,218
    )
    
    
    (11,641
    )Other assets
    
    
    0
    
    
    
    1,653
    
    
    
    0
    
    
    
    0Intangible assets
    
    
    0
    
    
    
    4,370
    
    
    
    0
    
    
    
    0Accumulated other comprehensive loss
    
    
    17,947
    
    
    
    23,806
    
    
    
    8,174
    
    
    
    0$
    (31,979
    )
    
    $
    (29,972
    )
    
    $
    (14,305
    )
    
    $
    (14,113
    )Deferred tax liability on
accumulated other comprehensive
loss
    
    $
    (6,325
    )
    
    $
    (9,030
    )
    
    $
    (3,106
    )
    
    $
    0Accumulated other comprehensive
loss at August 31, 2007:Net actuarial (gains)/losses
    
    $
    15,352
    
    
    
    
    
    
    $
    6,715Prior service cost
    
    
    2,563
    
    
    
    
    
    
    
    1,459Deferred taxes
    
    
    (6,325
    )
    
    
    
    
    
    
    (3,106
    )Net accumlated other comprehensive
loss at August 31, 2007
    
    $
    11,590
    
    
    
    
    
    
    $
    5,068
  43




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##### Table of Contents



2007
    
    
    2006(In thousands)Accumulated benefit obligation
    
    $
    154,214
    
    
    $
    161,466Projected benefit obligation
    
    
    157,086
    
    
    
    163,953Plan assets
    
    
    107,160
    
    
    
    95,909
   2007
    
    
    2006Equity securities
    
    
    67
    %
    
    
    70
    %Debt securities
    
    
    32
    
    
    
    26Cash and cash equivalents
    
    
    1
    
    
    
    4100
    %
    
    
    100
    %
    Pension Benefits
    
    Other Benefits(In thousands)2008
    
    $
    12,500
    
    
    $
    2,3002009
    
    
    11,300
    
    
    
    2,2002010
    
    
    11,100
    
    
    
    2,1002011
    
    
    11,100
    
    
    
    2,0002012
    
    
    11,100
    
    
    
    2,0002013-2017
    
    
    54,600
    
    
    
    9,100
  44




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##### Table of Contents



Pension Benefits
    
    
    Other Benefits2007
    
    
    2006
    
    
    2007
    
    
    2006Weighted average assumptions:Discount rate
    
    
    5,90
    %
    
    
    5.50
    %
    
    
    6.25
    %
    
    
    6.00
    %Expected return on plan assets
    
    
    7.70
    
    
    
    7.70
    
    
    
    N/A
    
    
    
    N/ARate of compensation increase
    
    
    2.85
    
    
    
    3.80
    
    
    
    N/A
    
    
    
    N/AHealth care cost increase
    
    
    N/A
    
    
    
    N/A
    
    
    
    9.5  5.0
    %
    
    
    10.0  5.0
    %Health care cost grading period
    
    
    N/A
    
    
    
    N/A
    
    
    9 years
    
    10 years
  Pension Benefits
    
    
    Other Benefits2007
    
    
    2006
    
    
    2007
    
    
    2006Discount rate
    
    
    5.75
    %
    
    
    5.10
    %
    
    
    6.00
    %
    
    
    5.25
    %Expected return on plan assets
    
    
    7.70
    
    
    
    7.70
    
    
    
    N/A
    
    
    
    N/ARate of compensation increase
    
    
    2.85
    
    
    
    3.80
    
    
    
    N/A
    
    
    
    N/AHealth care cost increase
    
    
    N/A
    
    
    
    N/A
    
    
    
    10.0  5.0
    %
    
    
    10.5  5.0
    %Health care cost grading period
    
    
    N/A
    
    
    
    N/A
    
    
    10 years
    
    
    11 years
  Increase
    
    Decrease(In thousands)Service and interest cost
    
    $
    62
    
    
    $
    (56
    )Postretirement benefit obligation
    
    
    636
    
    
    
    (581
    )
 45




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##### Table of Contents



NOTE 9  INCOME TAXES
  2007
    
    
    2006(In thousands)Deferred tax assets and liabilitiesAssets:Postretirement obligations
    
    $
    13,674
    
    
    $
    18,314Net operating loss carryforwards
    
    
    18,766
    
    
    
    22,330Tax credit carryforward
    
    
    7,391
    
    
    
    12,305Other accruals
    
    
    5,661
    
    
    
    4,768Inventory allowances
    
    
    2,687
    
    
    
    2,439Warranty reserve
    
    
    2,461
    
    
    
    2,240Customer advance payments and prepaid expenses
    
    
    2,057
    
    
    
    1,400Research and development costs
    
    
    2,308
    
    
    
    2,650Goodwill and purchase assets basis differences
    
    
    2,921
    
    
    
    2,834Other items
    
    
    3,423
    
    
    
    2,07661,349
    
    
    
    71,356Less valuation allowances
    
    
    19,140
    
    
    
    23,15142,209
    
    
    
    48,205Liabilities:Other accruals
    
    
    2,013
    
    
    
    1,684Fixed asset basis differences
    
    
    5,726
    
    
    
    5,675Goodwill and purchased asset basis differences
    
    
    38,991
    
    
    
    32,469Other items
    
    
    1,198
    
    
    
    76047,928
    
    
    
    40,588Net deferred tax asset
    
    $
    (5,719
    )
    
    $
    7,617
  46




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##### Table of Contents



Expense (in thousands)
 2007
    
    
    2006
    
    
    2005Current:U.S. federal
    
    $
    8,654
    
    
    $
    273
    
    
    $
    228Non-U.S.
    
    
    12,562
    
    
    
    15,037
    
    
    
    4,357U.S. state
    
    
    425
    
    
    
    166
    
    
    
    2121,641
    
    
    
    15,476
    
    
    
    4,606Deferred:U.S. federal
    
    
    11,777
    
    
    
    (3,018
    )
    
    
    2,795Non-U.S.
    
    
    2,438
    
    
    
    390
    
    
    
    (1,823
    )U.S. state
    
    
    1,010
    
    
    
    (259
    )
    
    
    26215,225
    
    
    
    (2,887
    )
    
    
    1,234$
    36,866
    
    
    $
    12,589
    
    
    $
    5,840Tax expense included in minority interest
    
    $
    862
    
    
    $
    916
    
    
    $
    846Non-U.S. pretax income (loss)
    
    $
    40,674
    
    
    $
    (6,284
    )
    
    $
    2,494
  2007
    
    
    2006
    
    
    2005(in thousands)Tax expense (benefit) at U.S. statutory rate
    
    $
    31,164
    
    
    $
    (1,903
    )
    
    $
    2,456Impact of change in valuation allowances on non-U.S. losses
    
    
    163
    
    
    
    1,201
    
    
    
    3,804Impact on U.S. taxes from repatriation of foreign earnings
    
    
    1,477
    
    
    
    (44
    )
    
    
    533Extraterritorial income deduction/Section 199
    
    
    (402
    )
    
    
    (517
    )
    
    
    (526
    )Impact from nondeductible goodwill write-off
    
    
    0
    
    
    
    15,421
    
    
    
    0Impact from other nondeductible expenses
    
    
    306
    
    
    
    834
    
    
    
    0Non-U.S. tax lower than U.S. tax rates
    
    
    (493
    )
    
    
    (2,550
    )
    
    
    (175
    )Tax contingencies
    
    
    1,160
    
    
    
    0
    
    
    
    0Revaluation of deferred tax accounts
    
    
    3,079
    
    
    
    0
    
    
    
    0Other items  net
    
    
    412
    
    
    
    147
    
    
    
    (252
    )Recorded tax expense
    
    $
    36,866
    
    
    $
    12,589
    
    
    $
    5,840
 NOTE 10  COMMON STOCK
  47




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##### Table of Contents



Stock option activity
 Weighted-Stock
    
    
    Average OptionOptions
    
    
    Price Per ShareOutstanding at September 1, 2004
    
    
    1,263,501
    
    
    $
    24.13Exercised
    
    
    (73,000
    )
    
    
    19.73Canceled
    
    
    (156,500
    )
    
    
    23.95Outstanding at August 31, 2005
    
    
    1,034,001
    
    
    
    24.44Granted
    
    
    80,000
    
    
    
    22.26Exercised
    
    
    (207,069
    )
    
    
    22.48Canceled
    
    
    (191,998
    )
    
    
    25.65Outstanding at August 31, 2006
    
    
    714,934
    
    
    
    24.44Granted
    
    
    41,900
    
    
    
    32.73Exercised
    
    
    (343,668
    )
    
    
    26.38Canceled
    
    
    (44,266
    )
    
    
    25.22Outstanding at August 31, 2007
    
    
    368,900
    
    
    $
    23.68
 Exercisable stock options at year-end2005
    
    
    879,6482006
    
    
    591,9822007
    
    
    284,134Shares available for grant at year-end2005
    
    
    1,200,0002006
    
    
    1,120,0002007
    
    
    956,365
 Components of outstanding stock options at August 31, 2007
 Weighted-Range of
    
    
    
    
    
    
    Average
    
    
    Weighted-
    
    
    IntrinsicExercise
    
    
    Number
    
    
    Contract Life
    
    
    Average
    
    
    ValuePrice
    
    
    Outstanding
    
    
    in Years
    
    
    Exercise Price
    
    
    (In thousands)$
    15.3822.00
    
    
    
    219,300
    
    
    
    6.33
    
    
    $
    20.97
    
    
    $
    7,28223.00  43.86
    
    
    
    149,600
    
    
    
    5.64
    
    
    
    27.63
    
    
    
    3,971$
    15.3843.86
    
    
    
    368,900
    
    
    
    6.05
    
    
    $
    23.68
    
    
    $
    11,253
 Components of exercisable stock options at August 31, 2007
 Range of
    
    
    
    
    
    
    Weighted-
    
    
    IntrinsicExercise
    
    
    Number
    
    
    Average
    
    
    ValuePrice
    
    
    Exercisable
    
    
    Exercise Price
    
    
    (In thousands)$
    15.3822.00
    
    
    
    180,967
    
    
    $
    20.87
    
    
    $
    6,02823.00  27.75
    
    
    
    103,167
    
    
    
    25.77
    
    
    
    2,931$
    15.3827.75
    
    
    
    284,134
    
    
    $
    22.65
    
    
    $
    8,959
  48




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##### Table of Contents



NOTE 11  NET INCOME PER SHARE
  2007
    
    
    2006
    
    
    2005(In thousands, except per share data)Numerator:Basic:Net income (loss)
    
    $
    50,705
    
    
    $
    (19,587
    )
    
    $
    (262
    )Effect of dilutive securities:Convertible debt interest
    
    
    0
    
    
    
    1,784
    
    
    
    1,920Income (loss) attributable to diluted shares
    
    $
    50,705
    
    
    $
    (17,803
    )
    
    $
    1,658Denominator:Basic:Weighted average shares
    
    
    17,025
    
    
    
    14,898
    
    
    
    14,608Effect of dilutive securities:Convertible debt
    
    
    0
    
    
    
    1,651
    
    
    
    1,778Dilutive
options and
restricted shares
    
    
    81
    
    
    
    26
    
    
    
    37Diluted
    
    
    17,106
    
    
    
    16,575
    
    
    
    16,423Net income (loss) per share:Basic:
    
    $
    2.98
    
    
    $
    (1.31
    )
    
    $
    (0.02
    )Diluted:
    
    $
    2.96
    
    
    $
    (1.31
    )
    
    $
    (0.02
    )
 NOTE 12  BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION
 Fluid Management
 Process Solutions
 Romaco
 49




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##### Table of Contents



2007
    
    
    2006
    
    
    2005(In thousands)Unaffiliated Customer Sales:Fluid Management
    
    $
    292,283
    
    
    $
    245,180
    
    
    $
    198,700Process Solutions
    
    
    273,890
    
    
    
    231,009
    
    
    
    238,698Romaco
    
    
    129,220
    
    
    
    149,200
    
    
    
    167,375Total
    
    $
    695,393
    
    
    $
    625,389
    
    
    $
    604,773Intersegment Sales:Fluid Management
    
    $
    0
    
    
    $
    0
    
    
    $
    0Process Solutions
    
    
    0
    
    
    
    441
    
    
    
    752Romaco
    
    
    0
    
    
    
    0
    
    
    
    0Corporate and Eliminations
    
    
    0
    
    
    
    (441
    )
    
    
    (752
    )Total
    
    $
    0
    
    
    $
    0
    
    
    $
    0Depreciation and Amortization:Fluid Management
    
    $
    7,376
    
    
    $
    7,491
    
    
    $
    7,772Process Solutions
    
    
    6,224
    
    
    
    6,496
    
    
    
    7,497Romaco
    
    
    2,090
    
    
    
    2,991
    
    
    
    3,550Corporate and Eliminations
    
    
    934
    
    
    
    1,600
    
    
    
    1,574Total
    
    $
    16,624
    
    
    $
    18,578
    
    
    $
    20,393EBIT:Fluid Management
    
    $
    76,973
    
    
    $
    56,522
    
    
    $
    39,731Process Solutions
    
    
    31,941
    (1)
    
    
    8,867
    (1)
    
    
    4,739
    (1)Romaco
    
    
    2,612
    (2)
    
    
    (38,189
    )(2)
    
    
    (7,905
    )(2)Corporate and Eliminations
    
    
    (17,244
    )
    
    
    (19,692
    )
    
    
    (15,114
    )Total
    
    $
    94,282
    
    
    $
    7,508
    
    
    $
    21,451Identifiable Assets:Fluid Management
    
    $
    252,980
    
    
    $
    234,579
    
    
    $
    215,176Process Solutions
    
    
    359,453
    
    
    
    328,495
    
    
    
    326,707Romaco
    
    
    101,777
    
    
    
    110,566
    
    
    
    186,464Corporate and Eliminations
    
    
    101,933
    
    
    
    38,407
    
    
    
    11,846Total
    
    $
    816,143
    
    
    $
    712,047
    
    
    $
    740,193Capital Expenditures:Fluid Management
    
    $
    8,373
    
    
    $
    7,882
    
    
    $
    6,757Process Solutions
    
    
    4,209
    
    
    
    2,046
    
    
    
    9,053Romaco
    
    
    960
    
    
    
    3,436
    
    
    
    3,823Corporate and Eliminations
    
    
    2,994
    
    
    
    296
    
    
    
    630Total
    
    $
    16,536
    
    
    $
    13,660
    
    
    $
    20,263
  50




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##### Table of Contents



2007
    
    
    2006
    
    
    2005(In thousands)SalesUnited States
    
    $
    280,645
    
    
    $
    253,818
    
    
    $
    225,798Europe
    
    
    185,168
    
    
    
    176,695
    
    
    
    193,190Other North America
    
    
    67,165
    
    
    
    71,535
    
    
    
    68,052Asia
    
    
    100,263
    
    
    
    79,481
    
    
    
    82,357South America
    
    
    40,541
    
    
    
    33,225
    
    
    
    26,675Other
    
    
    21,611
    
    
    
    10,635
    
    
    
    8,701$
    695,393
    
    
    $
    625,389
    
    
    $
    604,773Identifiable AssetsUnited States
    
    $
    257,125
    
    
    $
    268,350
    
    
    $
    271,493Europe
    
    
    272,275
    
    
    
    250,034
    
    
    
    315,625Other North America
    
    
    59,743
    
    
    
    52,750
    
    
    
    51,817South America
    
    
    29,874
    
    
    
    26,628
    
    
    
    22,776Asia
    
    
    95,193
    
    
    
    76,619
    
    
    
    66,636Corporate
    
    
    101,933
    
    
    
    37,666
    
    
    
    11,846$
    816,143
    
    
    $
    712,047
    
    
    $
    740,193
 
 (1)
    
    Includes cost of $2,541,000 and $3,684,000 in fiscal years 2006 and 2005, respectively,
related to the restructuring of our Process Solutions segment. Fiscal 2007 includes a gain of
$5,036,000, fiscal 2006 includes losses of $189,000 and fiscal 2005 includes losses of
$2,053,000 related to the disposition of facilities and product lines.(2)
    
    Includes costs of $1,818,000, $4,755,000 and $4,279,000 in fiscal years 2007, 2006 and 2005,
respectively, related to the restructuring of our Romaco segment. Fiscal 2007 includes a gain
of $243,000 on product line and facility dispositions and fiscal 2006 includes a gain of
$8,144,000 on the disposition of product lines. Fiscal 2006 also includes a $39,174,000
goodwill impairment charge. 51




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NOTE 13  QUARTERLY DATA (UNAUDITED)
 2007 Quarters1st
    
    
    2nd
    
    
    3rd
    
    
    4th
    
    
    Total(In thousands, except per share data)Sales
    
    $
    154,433
    
    
    $
    162,498
    
    
    $
    171,428
    
    
    $
    207,034
    
    
    $
    695,393Gross profit
    
    
    53,863
    
    
    
    54,849
    
    
    
    61,415
    
    
    
    72,214
    
    
    
    242,341EBIT
    
    
    19,163
    
    
    
    15,794
    
    
    
    23,000
    
    
    
    36,325
    
    
    
    94,282Income
before income taxes and minority interest
    
    
    17,623
    
    
    
    14,449
    
    
    
    21,535
    
    
    
    35,432
    
    
    
    89,039Net income
    
    
    10,613
    
    
    
    7,932
    
    
    
    13,248
    
    
    
    18,912
    
    
    
    50,705Net income per share:Basic
    
    $
    0.63
    
    
    $
    0.47
    
    
    $
    0.78
    
    
    $
    1.10
    
    
    $
    2.98Diluted
    
    
    0.62
    
    
    
    0.46
    
    
    
    0.77
    
    
    
    1.10
    
    
    $
    2.96Weighted average common shares:Basic
    
    
    16,852
    
    
    
    17,058
    
    
    
    17,085
    
    
    
    17,121
    
    
    
    17,025Diluted
    
    
    17,031
    
    
    
    17,166
    
    
    
    17,205
    
    
    
    17,192
    
    
    
    17,106
 2006 Quarters1st
    
    
    2nd
    
    
    3rd
    
    
    4th
    
    
    Total(In thousands, except per share data)Sales
    
    $
    138,959
    
    
    $
    149,997
    
    
    $
    153,243
    
    
    $
    183,190
    
    
    $
    625,389Gross profit
    
    
    46,742
    
    
    
    49,459
    
    
    
    52,805
    
    
    
    65,910
    
    
    
    214,916EBIT
    
    
    (25,259
    )
    
    
    7,510
    
    
    
    6,174
    
    
    
    19,083
    
    
    
    7,508Income
(loss) before income taxes and minority interest
    
    
    (28,782
    )
    
    
    3,834
    
    
    
    3,049
    
    
    
    16,461
    
    
    
    (5,438
    )Net income (loss)
    
    
    (29,734
    )
    
    
    1,202
    
    
    
    (75
    )
    
    
    9,020
    
    
    
    (19,587
    )Net income (loss) per share:Basic
    
    $
    (2.02
    )
    
    $
    0.08
    
    
    $
    (0.01
    )
    
    $
    0.59
    
    
    $
    (1.31
    )Diluted
    
    
    (2.02
    )
    
    
    0.08
    
    
    
    (0.01
    )
    
    
    0.56
    
    
    
    (1.31
    )Weighted average common shares:Basic
    
    
    14,700
    
    
    
    14,744
    
    
    
    14,784
    
    
    
    15,363
    
    
    
    14,898Diluted
    
    
    16,499
    
    
    
    16,537
    
    
    
    16,592
    
    
    
    16,713
    
    
    
    16,575
 52




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##### Table of Contents



ITEM 9 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
  
 ITEM 9A. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
   Management Report on Internal Control Over Financial Reporting
  
    
    Pertain to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of the assets of the Company;
    
    Provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the Company are being made only in
accordance with authorizations of management and directors of the Company; and
    
    Provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Companys assets that could have a material effect
on the financial statements.
  53




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##### Table of Contents



Changes in Internal Control over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION
  54




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##### Table of Contents



PART III
 
 ITEM 10 DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT AND CORPORATE
GOVERNANCE
 Information Concerning Directors and Executive Officers
  Code of Ethics
 www.robn.com
 Audit Committee Financial Expert
  
 ITEM 11 EXECUTIVE COMPENSATION
  55




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##### Table of Contents



ITEM 12 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
  (c)Number ofCommonSharesRemaining(a)
    
    (b)
    
    Available forNumber of Common
    
    Weighted-
    
    FutureShares to
    
    Average
    
    Issuancebe issued Upon
    
    Exercise Price
    
    Under EquityExercise of
    
    of
    
    CompensationOutstanding
    
    Outstanding
    
    PlansOptions,
    
    Options,
    
    (excluding securitiesWarrants, and
    
    Warrants, and
    
    reflected inPlan Category
    
    Rights
    
    Rights
    
    column (a))Equity compensation
plans approved by
shareholders(10
    
    
    368,900
    
    
    $
    23.68
    
    
    
    956,365Equity compensation
plans not approved
by
shareholders(20
    
    
    0
    
    
    
    0
    
    
    
    0Total
    
    
    368,900
    
    
    $
    23.68
    
    
    
    956,365
 
 (1)
    
    Includes outstanding options under (i) our 1994 Long-Term Incentive
Stock Plan, 1995 Stock Option Plan for Non-Employee Directors, and
1999 Long-Term Incentive Plan, all of which have terminated as to
future awards, and (ii) our 2004 Stock Incentive Plan.(2)
    
    All shares listed in Column (c) are available for future awards under
our 2004 Stock Incentive Plan. Awards may be comprised of options,
restricted shares, performance shares, share awards or share unit
awards upon such terms as the Compensation Committee of the Board
determines at the time of grant that are consistent with the express
terms of the plan.  
 ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
  
 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
  56




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##### Table of Contents



PART IV
 
 ITEM 15 EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 (a) (1)
    
    FINANCIAL STATEMENTSThe following consolidated financial statements of Robbins & Myers,
Inc. and its subsidiaries are at Item 8 hereof.Consolidated Balance Sheet  August 31, 2007 and 2006.Consolidated Statement of Operations 

Years ended August 31, 2007, 2006 and 2005.Consolidated Shareholders Equity Statement 

Years ended August 31, 2007, 2006 and 2005.Consolidated Cash Flow Statement 

Years ended August 31, 2007, 2006 and 2005.Notes to Consolidated Financial Statements.(a) (2)
    
    FINANCIAL STATEMENT SCHEDULESchedule II  Valuation and Qualifying Accounts
  (a) (3)
    
    EXHIBITS. See INDEX to EXHIBITS.
 57




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##### Table of Contents



ROBBINS & MYERS, INC.BY    /s/ Peter C. WallacePeter
C. WallacePresident
and Chief Executive Officer  NAME
    
    TITLE
    
    DATE/s/ Peter C. Wallace

Peter C. Wallace
    
    Director, President and
Chief Executive Officer
    
    November 12, 2007/s/ Christopher M. Hix

Christopher M. Hix
    
    Vice President and Chief
Financial Officer 
(Principal Financial Officer)
    
    November 12 2007/s/ Kevin J. Brown

Kevin J. Brown
    
    Corporate Controller 
(Principal Accounting Officer)
    
    November 12, 2007
 *Thomas P. Loftis
    
    Chairman Of Board
    
    November 12, 2007*Daniel W. Duval
    
    Director
    
    November 12, 2007*David T. Gibbons
    
    Director
    
    November 12, 2007*Stephen F. Kirk
    
    Director
    
    November 12, 2007*Andrew G. Lampereur
    
    Director
    
    November 12, 2007*William D. Manning
    
    Director
    
    November 12, 2007*Dale L. Medford
    
    Director
    
    November 12, 2007
 
  /s/ Peter C. WallacePeter C. WallaceTheir Attorney-in-fact 58




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##### Table of Contents



AdditionsCharged toBalance at
    
    
    Charged to
    
    
    OtherBeginning of
    
    
    Costs and
    
    
    Accounts-
    
    
    Deductions-
    
    
    Balance atDescription
    
    Period
    
    
    Expenses
    
    
    Describe
    
    
    Describe
    
    
    End of Period(in thousands)Year Ended August 31, 2007Allowances and reserves deducted from assets:Uncollectible and reserves deducted from assets
    
    $
    6,860
    
    
    $
    2,455
    
    
    $
    0
    
    
    $
    3,126
    (1)
    
    $
    6,189Inventory obsolescence
    
    
    17,583
    
    
    
    2,156
    
    
    
    0
    
    
    
    5,602
    (2)
    
    
    14,137Deferred tax asset valuation allowance
    
    
    23,151
    
    
    
    1,421
    
    
    
    0
    
    
    
    5,432
    (7)
    
    
    19,140Other reserves:Warranty claims
    
    
    7,605
    
    
    
    2,188
    
    
    
    0
    
    
    
    1,871
    (3)
    
    
    7,922Current & L-T insurance reserves
    
    
    1,741
    
    
    
    871
    
    
    
    0
    
    
    
    949
    (4)
    
    
    1,663Restructuring reserves
    
    
    1,755
    
    
    
    0
    
    
    
    0
    
    
    
    1,497
    (5)
    
    
    258Year Ended August 31, 2006Allowances and reserves deducted from assets:Uncollectible and reserves deducted from assets
    
    $
    4,632
    
    
    $
    2,828
    
    
    $
    0
    
    
    $
    600
    (1)
    
    $
    6,860Inventory obsolescence
    
    
    21,351
    
    
    
    2,347
    
    
    
    0
    
    
    
    6,115
    (2)
    
    
    17,583Deferred tax asset valuation allowance
    
    
    23,296
    
    
    
    1,201
    
    
    
    0
    
    
    
    1,346
    (7)
    
    
    23,151Other reserves:Warranty claims
    
    
    9,176
    
    
    
    3,134
    
    
    
    0
    
    
    
    4,705
    (3)
    
    
    7,605Current & L-T insurance reserves
    
    
    2,098
    
    
    
    1,294
    
    
    
    0
    
    
    
    1,651
    (4)
    
    
    1,741Restructure reserves
    
    
    1,074
    
    
    
    5,738
    
    
    
    0
    
    
    
    5,057
    (5)
    
    
    1,755Year Ended August 31, 2005Allowances and reserves deducted from assets:Uncollectible and reserves deducted from assets
    
    $
    4,018
    
    
    $
    1,088
    
    
    $
    0
    
    
    $
    474
    (1)
    
    $
    4,632Inventory obsolescence
    
    
    20,651
    
    
    
    3,425
    
    
    
    0
    
    
    
    2,725
    (2)
    
    
    21,351Deferred tax asset valuation allowance
    
    
    16,792
    
    
    
    3,803
    
    
    
    2,701
    (6)
    
    
    0
    
    
    
    23,296Other reserves:Warranty claims
    
    
    8,330
    
    
    
    3,348
    
    
    
    0
    
    
    
    2,502
    (3)
    
    
    9,176Current & L-T insurance reserves
    
    
    2,203
    
    
    
    1,680
    
    
    
    0
    
    
    
    1,785
    (4)
    
    
    2,098Restructure reserves
    
    
    667
    
    
    
    5,677
    
    
    
    0
    
    
    
    5,270
    (5)
    
    
    1,074
 
 Note (1)
    
    Represents accounts receivable written off against the reserve, and impact from
dispositions of $981,000 and $200,000 in fiscal 2007 and 2006, respectively.Note (2)
    
    Inventory items scrapped and written off against the reserve, and impact from dispositions
of $2,484,000 and $2,800,000 in fiscal 2007 and 2006, respectively.Note (3)
    
    Warranty cost incurred applied against the reserve, and impact from dispositions of
$91,000 and $970,000 in fiscal 2007 and 2006, respectively.Note (4)
    
    Spending against
casualty reserve.Note (5)
    
    Spending against
restructure reserve.Note (6)
    
    Increase to deferred tax asset and valauation
allowance and exchange ratesNote (7)
    
    Impact of exchange rates, valuation allowance
release and changes in tax rates 59




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##### Table of Contents



INDEX TO EXHIBITS(3)
    
    ARTICLES OF INCORPORATION AND BY-LAWS:3.1
    
    
    Amended Articles of Incorporation of Robbins & Myers, Inc.
    
    F3.2
    
    
    Code of Regulations of Robbins
& Myers, Inc. was filed as Exhibit 3.2 to our Quarterly Report on Form 10-Q for the
Quarter ended February 28, 2007
    
    *(4)
    
    INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES:4.1
    
    
    Fifth Amended and Restated Credit Agreement dated
December 19, 2006 among Robbins & Myers, Inc., Robbins &
Myers Finance Europe B.V., the Lenders named in the
amended agreement and JP Morgan Chase Bank, N.A. as
Administrative Agent and Issuing Bank was filed as
Exhibit 4.1 to our Current Report on Form 8-K filed on
December 22, 2006.
    
    *4.2
    
    
    Amended and Restated Pledge and Security Agreement
between Robbins & Myers, Inc. and Bank One, Dayton, N.A.,
dated May 15, 1998, was filed as Exhibit 4.2 to our
Report on Form 10-K for the year ended August 31, 2003
    
    *4.3
    
    
    Form of $100 million senior note agreement dated May 1,
1998 was filed as Exhibit 4.1 to our Report on Form 10-Q
for the quarter ended May 31, 1998
    
    *
 (10)
    
    MATERIAL CONTRACTS:10.1
    
    
    Robbins & Myers, Inc. Cash Balance
Pension Plan (As Amended and
Restated Effective as of October
1, 1999) was filed as Exhibit 10.1
to our Annual Report on Form 10-K
for the year ended August 31, 2001
    
    */M10.2
    
    
    Third Amendment to the Robbins &
Myers, Inc. Cash Balance Pension
Plan, dated October 31, 2005 was
filed as an Exhibit to our Current
Report on Form 8-K filed on
November 4, 2005
    
    */M10.3
    
    
    Robbins & Myers, Inc. Employee
Savings Plan as amended through
August 31, 2000 was filed as
Exhibit 10.4 to our Annual Report
on Form 10-K for the year ended
August 31, 2000
    
    */M10.4
    
    
    Robbins & Myers, Inc. Executive
Supplemental Retirement Plan as
amended through October 5, 2007
    
    F/M10.5
    
    
    Robbins & Myers, Inc. Executive
Supplemental Pension Plan as
amended through October 5, 2007
    
    F/M10.6
    
    
    Form of Indemnification Agreement
between Robbins & Myers, Inc., and
each director was filed as Exhibit
10.5 to our Annual Report on Form
10-K for the year ended August 31,
2001
    
    */M10.7
    
    
    Robbins & Myers, Inc. 1994
Directors Stock Compensation Plan
was filed as Exhibit 10.6 to our
Annual Report on Form 10-K for the
year ended August 31, 2001
    
    */M
 60




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##### Table of Contents



10.8
    
    Robbins & Myers, Inc. 1994 Long-Term Incentive Stock Plan
as amended was filed as Exhibit 10.11 to our Report on
Form 10-K for the year ended August 31, 1996
    
    */M10.9
    
    Robbins & Myers, Inc. 1995 Stock Option Plan for
Non-Employee Directors was filed as Exhibit 10.12 to our
Report on Form 10-K for the year ended August 31, 1996
    
    */M10.10
    
    Robbins & Myers, Inc. Senior Executive Annual Cash Bonus
Plan as amended through October 5, 2007
    
    F/M10.11
    
    Robbins & Myers, Inc. 1999 Long-Term Incentive Stock Plan
was filed as Exhibit 4.3 to our Registration Statement on
Form S-8 (File No. 333-35856)
    
    */M
 10.12
    
    Robbins & Myers, Inc. 2004 Stock Incentive Plan as amended through October 4, 2007
    
    F/M10.13
    
    Letter Agreement between Robbins & Myers, Inc. and Christopher M. Hix, dated
July 17, 2006 was filed as an Exhibit to our Current Report on Form 8-K filed on
July 17, 2006
    
    */M10.14
    
    Employment Agreement between Robbins & Myers, Inc. and Peter C. Wallace as
amended through October 5, 2007 and dated November 9, 2007.
    
    F/M10.15
    
    Form of Executive Officer Change of Control Agreement as amended through October
5, 2007 entered into with each of Gary S. Brewer, Kevin J. Brown, Christopher M
Hix, and Saeid Rahimian
    
    F/M10.16
    
    2006 Executive Supplemental Retirement Plan, effective August 31, 2006, and as
amended through October 5, 2007
    
    F/M10.17
    
    Asset and Share Purchase Agreement, dated February 28, 2006, among Robbins &
Myers, Inc., Romaco International B.V., and Romaco Pharmatechnik GmbH and Coesia,
S.p.A. was filed as an Exhibit to our Current Report on Form 8-K filed on
March 3, 2006
    
    *10.18
    
    Form of Option Award Agreement under Robbins & Myers, Inc. 2004 Stock Incentive
Plan approved by the Compensation Committee of Board of Directors of Robbins &
Myers, Inc. on October 5, 2007
    
    F/M10.19
    
    Form of Award Agreement for Restricted Share Award under Robbins & Myers, Inc.
2004 Stock Incentive Plan approved by the Compensation Committee of Board of
Directors of Robbins & Myers, Inc. on October 5, 2007
    
    F/M10.20
    
    Form of Award Agreement for Performance Share Award under Robbins & Myers, Inc.
2004 Stock Incentive Plan approved by the Compensation Committee of Board of
Directors of Robbins & Myers, Inc. on October 5, 2007
    
    F/M10.21
    
    Award Agreement for Performance Share Award to Peter C. Wallace under Robbins
&Myers, Inc. 2004 Stock Incentive Plan approved by the Compensation Committee of
Board of Directors of Robbins & Myers, Inc. on October 6, 2005 was filed as an
Exhibit to our Current Report on Form 8-K filed on October 11, 2005
    
    */M
 61




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##### Table of Contents



(14)
    
    CODE OF CONDUCT14.1
    
    
    Robbins & Myers, Inc. Code of Business Conduct was filed
as Exhibit 14.1 to our Report on Form 10-K for the year
ended August 31, 2006
    
    *(21)
    
    SUBSIDIARIES OF THE REGISTRANT21.1
    
    
    Subsidiaries of Robbins & Myers, Inc.
    
    F(23)
    
    CONSENTS OF EXPERTS AND COUNSEL23.1
    
    
    Consent of Ernst & Young LLP
    
    F(24)
    
    POWER OF ATTORNEY24.1
    
    
    Powers of Attorney of any person who signed this Report
on Form 10-K on behalf of another pursuant to a Power of
attorney
    
    F(31)
    
    RULE 13A14(A) CERTIFICATIONS31.1
    
    
    Rule 13a-14(a) CEO Certification
    
    F31.2
    
    
    Rule 13a-14(a) CFO Certification
    
    F(32)
    
    SECTION 1350 CERTIFICATIONS32.1
    
    
    Section 1350 CEO Certification
    
    F32.2
    
    
    Section 1350 CFO Certification
    
    FF
    
    Indicates Exhibit is being filed with this Report."*
    
    Indicates that Exhibit is incorporated by reference in
this Report from a previous filing with the Commission.
Unless otherwise indicated, all incorporated items are
incorporated from SEC File No. 000-288.R
    
    Instrument with respect to indebtedness that does not
exceed 10% of the Companys total assets which is not
being filed, but will be furnished to the Commission upon
its request.M
    
    Indicates management contract or compensatory arrangement.
 62