Emerson 2011 Annual Report Download - page 23

Annual Report | 21
office and manufacturing facilities in the United States,
China and Brazil. Net cash paid in connection with acquisi-
tions was $232 million, $2,843 million and $776 million in
2011, 2010 and 2009, respectively. Proceeds from dives-
titures in those years were $103 million, $846 million and
$4 million, respectively.
Dividends were $1,039 million ($1.38 per share) in 2011,
compared with $1,009 million ($1.34 per share) in 2010
and $998 million ($1.32 per share) in 2009. In November
2011, the Board of Directors voted to increase the quar-
terly cash dividend 16 percent to an annualized rate of
$1.60 per share. In 2008, the Board of Directors approved
a program for the repurchase of up to 80 million common
shares, under which 18.7 million shares, 2.1 million
shares and 21.0 million shares were repurchased in 2011,
2010 and 2009, respectively; 30.7 million shares remain
available for repurchase under the 2008 authorization.
Purchases of Emerson common stock totaled
$958 million, $100 million and $695 million in 2011,
2010 and 2009, respectively, at an average price paid
per share of $51.31, $48.15 and $33.09, respectively.
LEVERAGE/CAPITALIZATION
(DOLLARS IN MILLIONS) 2009 2010 2011
Total Assets $19,763 22,843 23,861
Long-term Debt $ 3,998 4,586 4,324
Common Stockholders’ Equity $ 8,555 9,792 10,399
Total Debt-to-Capital Ratio 34.8% 34.1% 33.3%
Net Debt-to-Net Capital Ratio 25.7% 26.2% 23.2%
Operating Cash Flow-to-Debt Ratio 67.5% 65.0% 62.2%
Interest Coverage Ratio 11.0X 11.3X 15.8X
Total debt, which includes long-term debt, current
maturities of long-term debt, commercial paper and
other short-term borrowings, was $5.2 billion, $5.1 billion
and $4.6 billion for 2011, 2010 and 2009, respectively.
Short-term borrowings increased $398 million in 2010,
primarily reflecting incremental commercial paper
borrowings associated with the mix of funding for the
Avocent and Chloride acquisitions, which also included
issuance of long-term debt, proceeds from divestitures
and operating cash flow. See Note 3 for additional infor-
mation. During 2010, the Company issued $300 million
each of 4.25% notes due November 2020 and 5.25%
notes due November 2039 and repaid $500 million of
7.125% notes that matured in August 2010. During 2009,
the Company issued $250 million each of 4.125% notes
due April 2015, 5.0% notes due April 2019 and 6.125%
notes due April 2039 and $500 million of 4.875% notes
due October 2019, and repaid $175 million of 5.0% notes
and $250 million of 5.85% notes that matured in October
2008 and March 2009, respectively.
The total debt-to-capital ratio was 33.3 percent at year
end 2011, compared with 34.1 percent for 2010 and
34.8 percent for 2009. At September 30, 2011, net debt
(total debt less cash and short-term investments) was
23.2 percent of net capital, compared with 26.2 percent
in 2010 and 25.7 percent in 2009. Both ratios improved
in 2011, reflecting higher equity. The operating cash
flow-to-debt ratio was 62.2 percent, 65.0 percent and
67.5 percent in 2011, 2010 and 2009, respectively. The
Company’s interest coverage ratio (earnings before
income taxes plus interest expense, divided by interest
expense) was 15.8 times in 2011, compared with
11.3 times and 11.0 times in 2010 and 2009. The increase
in interest coverage from 2010 to 2011 reflects higher
earnings and lower average borrowings, while the
increase from 2009 to 2010 was primarily due to higher
earnings. See Notes 8 and 9 for additional information.
In December 2010 the Company entered into a
$2.75 billion four-year revolving backup credit facility
to support short-term borrowings, which replaced a
$2.83 billion five-year revolving credit facility dated
April 2006. The Company did not draw upon either facility
in 2011, 2010 or 2009. The credit facility contains no
financial covenants and is not subject to termination
based on a change in credit ratings or material adverse
changes. The Company also maintains a universal shelf
registration statement on file with the U.S. Securities and
Exchange Commission (SEC) under which it can issue
debt securities, preferred stock, common stock, warrants,
share purchase contracts and share purchase units
without a predetermined limit. Securities can be sold in
one or more separate offerings with the size, price and
terms to be determined at the time of sale.
DIVIDENDS PER SHARE
Annual dividends increased to a record $1.38 per share in 2011,
representing the 55th consecutive year of increases.
07
$1.05
11100908
$1.20
$1.32 $1.34 $1.38