Q4 2012 Earnings Call Transcript

Transcript Call Date 03/01/2013

Operator: Good morning, ladies and gentlemen, and welcome to Dresser-Rand's Fourth Quarter and Year End 2012 Earnings Conference Call. My name is Bini and I will be your coordinator for today's call. At this time, all participants are in a listen-only mode. We will be facilitating a question-and-answer session towards the end of the conference call. As a reminder, this conference call is being recorded for replay purposes. After Dresser-Rand's comments today, I will instruct you on the procedures for asking your questions.

I'll now turn the conference over to Blaise Derrico, Director of Investor Relations. Please go ahead.

Blaise Derrico - Director, IR: Amy, thank you. Good morning. This call is open to the public. It's being webcast simultaneously at and will be temporarily archived for replay. A copy of the news release we issued yesterday is available on our website, as are the slides we will use today during our presentation. We will let you know when to advance the slides as we deliver our prepared remarks.

Please turn to Slide 2. The statements made during this conference call that are not historical facts may be forward-looking statements. Forward-looking statements involve risks and uncertainties that may cause actual results or events to differ materially from those expressed or implied in such statements. In addition, this conference call contains time-sensitive information that reflects management's best judgment only as of the date of the live call. Management's statements may include non-GAAP financial measures. For reconciliation of these measures, refer to our earnings news release or the conference slides available on our website.

Dresser-Rand does not undertake any ongoing obligation other than that imposed by law to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after this call. Further information concerning issues that could materially affect the financial performance related to forward-looking statements can be found in Dresser-Rand's periodic filings with the SEC.

I'll now turn the call over to Vince Volpe, our President and CEO.

Vincent R. Volpe Jr. - President and CEO: Thank you for joining us today, and welcome to Dresser-Rand's earnings conference call. I'll start with a few opening comments, and Mark Baldwin, our Chief Financial Officer, will follow me with a detailed discussion of our fourth quarter results.

Please turn to Slide 3. Overall 2012 was a good year with another year of record bookings and record level year-end backlog. Operating income was approximately 30% higher compared to 2011, despite our 2012 results being adversely affected by certain project delays and as compared to 2011 the stronger U.S. dollar. We estimate the impact of the adverse translation of a stronger U.S. dollar to be approximately $20 million.

Please turn to Slide 4, on specialty part of our safe performance; safety is a core value of our core value of our company and we continue to make progress toward our goal of zero injuries. Our total recordable incident rate for 2012 was 0.41, which improved 28% compared to 2011. This is significant as we believe the prior year's industry average is nearly 10 times higher. While our principal emphasis on safety is to safeguard the well-being of our employees and others involved in our business, it is also important to recognize that a strong safety performance is a proxy for a culture of discipline that results in operational excellence, which inures to the benefit of our clients and shareholders as well as our employees. We believe that safety, quality and operational excellence are an inextricably linked. We share our clients' belief that safety excellence requires the same kind of discipline as quality, on-time delivery and cost reduction.

Read our Earnings Call Transcript disclaimer.
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