Investor Relations

Provides 2014 EPS Guidance of $4.55-$4.75, Excluding Special Items

Crane Co. (NYSE:CR), a diversified manufacturer of highly engineered industrial products, reported fourth quarter 2013 earnings of $0.84 per diluted share, compared to $0.79 per share in the fourth quarter of 2012. Fourth quarter 2013 results included after-tax transaction-related costs, net, of $11.9 million, or $0.20 per share, related to the recent acquisition of MEI Conlux Holdings. Fourth quarter 2012 results included after-tax charges of $3.9 million, or $0.07 per share, associated with transaction-related costs associated with the MEI acquisition, and $3.9 million, or $0.07 per share, of repositioning charges. Excluding Special Items in both years, fourth quarter 2013 earnings per diluted share increased 13% to $1.04, compared to $0.92 in the fourth quarter of 2012. Fourth quarter 2013 earnings included $0.02 per share related to the operating results of MEI. (Please see the attached Non-GAAP Financial Measures table.)

Fourth quarter 2013 sales of $681.4 million increased $51.7 million, or 8.2%, compared to $629.8 million in the fourth quarter of 2012, resulting from a core sales increase of $28.2 million (4.5%), sales from the MEI acquisition of $25.2 million (4.0%), and unfavorable foreign exchange of $1.7 million (0.3%).

Operating profit in the fourth quarter increased 9.1% to $83.1 million, compared to $76.2 million in the fourth quarter of 2012. Excluding Special Items, fourth quarter operating profit increased 15.8% to $97.9 million, compared to $84.6 million in the fourth quarter of 2012, and operating profit margin increased to 14.4%, compared to 13.4% in the fourth quarter of 2012. (Please see the attached Non-GAAP Financial Measures table.)

Full Year 2013 Results

Total sales in 2013 were $2.60 billion, an increase of 0.6% from $2.58 billion in 2012, reflecting $25.2 million (1.0%) from the acquisition of MEI, partially offset by unfavorable foreign currency translation of $11.3 million (0.4%).

Operating profit for the full year 2013 was $347.9 million, compared to $310.4 million in 2012. Excluding Special Items, 2013 operating profit increased 12.0% to $375.3 million, compared to $334.9 million in 2012, and operating profit margin increased to 14.5%, compared to 13.0% in 2012.

Full year 2013 earnings per diluted share were $3.73, compared to $3.72 per share in 2012. Excluding Special Items, 2013 earnings per diluted share increased 12.7% to $4.18 (including $0.02 per share from MEI), compared to $3.70 per share in 2012. (Please see the attached Non-GAAP Financial Measures table.) Order backlog was $762 million at December 31, 2013 (including $32 million related to MEI) compared to $749 million at December 31, 2012.

“We are pleased to report record full year EPS of $4.18 per share, excluding Special Items, which was in line with our most recent guidance” said Crane Co. chief executive officer, Eric C. Fast. “In spite of a difficult revenue environment, our adjusted full year operating margin was a record 14.5%, a substantial improvement over 13.0% in 2012 and 12.3% in 2011.”

Max Mitchell, President and Chief Operating Officer said, “In 2014, we are expecting our fourth consecutive year of record earnings, continued margin expansion and strong free cash flow. We enter the year having completed the acquisition of MEI, a business with highly innovative, complementary products that further strengthens our portfolio. In addition to unlocking significant synergies, the integration brings together MEI with our legacy Crane Payment Solutions team to create Crane Payment Innovations, a business that delivers highly engineered solutions and unparalleled customer service across attractive end markets.”

Cash Flow and Financial Position

Cash provided by operating activities in the fourth quarter of 2013 was $148.4 million, compared to $155.5 million in the fourth quarter of 2012. Free cash flow (cash provided by operating activities less capital spending) for the fourth quarter of 2013 was $138.0 million, compared to $146.1 million in the fourth quarter of 2012. For the twelve months ended December 31, 2013, cash provided by operating activities was $239.4 million, compared to $234.8 million in 2012. Free cash flow for the full year 2013 was $210 million, compared to $205 million in the prior year. The Company’s cash position was $270.6 million at December 31, 2013, compared to $423.9 million at December 31, 2012. The reduction in cash was driven by the acquisition of the outstanding equity interests of MEI Conlux Holding (U.S.), Inc. and its affiliate MEI Conlux Holdings (Japan), Inc. In connection with the acquisition, the Company issued $250 million of 2.750% Senior Notes due 2018 and $300 million of 4.450% Senior Notes due 2023.

Segment Results

All comparisons detailed in this section refer to operating results for the fourth quarter 2013 versus the fourth quarter 2012. Beginning in the first quarter 2013, the operating results of the former Controls segment have been included in the Fluid Handling segment. Prior period amounts have been restated for comparative purposes.

Aerospace & Electronics

						Fourth Quarter											Change
(dollars in millions)						2013					2012
Sales						$186.7					$176.1						$10.7			6.1%
Operating Profit						$44.7					$39.2						$5.5			14.1%
Profit Margin						23.9%					22.3%

Fourth quarter 2013 sales increased $10.7 million, or 6.1%, reflecting sales increases of $5.5 million (4.9%) in the Aerospace Group and $5.2 million (8.0%) in the Electronics Group. The Aerospace Group sales increase reflected stronger commercial OEM and aftermarket sales activity. The increase in Electronics Group sales was driven primarily by higher shipments of Power and Microwave products. Segment operating profit improved 14%, with improved operating profit and margin in both businesses. Aerospace & Electronics order backlog was $361 million at December 31, 2013, compared to $378 million at December 31, 2012. The decline in backlog reflects lower defense related orders.

Engineered Materials

					Fourth Quarter								Change
(dollars in millions)					2013				2012
Sales					$52.4				$46.9				$5.5		11.7%
Operating Profit					$5.8				$3.3				$2.5		73.7%
Operating Profit, before Special Items*					$5.8				$4.7				$1.1		24.3%
Profit Margin					11.1%				7.1%
Profit Margin, before Special Items*					11.1%				10.0%
*Repositioning charges of $1.4 million in 2012 primarily associated with the closure of a manufacturing facility.

Segment sales of $52.4 million were 11.7% higher than the fourth quarter of 2012, driven by higher sales to recreational vehicle equipment manufacturers. Excluding Special Items, operating profit increased 24% to $5.8 million, and margins increased from 10.0% to 11.1%, reflecting the impact of the higher sales.

Merchandising Systems

		Fourth Quarter										Change
(dollars in millions)		2013					2012
Sales		$122.6					$94.2					$28.5			30.3%
Operating Profit		$7.9					$10.4					($2.5)			(24.2%)
Operating Profit, before Special Items*		$13.7					$11.8					$1.9			15.8%
Profit Margin		6.5%					11.1%
Proft Margin, before Special Items*		11.2%					12.6%
* Excludes $1.4 million of repositioning charges in Q4'12 related to facility exit costs, and $5.8 million in Q4'13 primarily related to inventory and backlog step-up charges associated with the acquisition of MEI (please see Non-GAAP table for details).

Merchandising Systems sales of $122.6 million increased $28.5 million, or 30%, driven by $25.2 million of sales related to the acquisition of MEI, coupled with higher sales from our Payment Solutions business. Vending Solutions sales were flat compared to last year. Excluding Special Items, operating profit increased in the quarter, reflecting strong performance in Payment Solutions and profit attributable to the acquisition of MEI, partially offset by lower operating profit in Vending Solutions.

Fluid Handling

					Fourth Quarter								Change
(dollars in millions)					2013				2012
Sales					$319.7				$312.6				$7.1				2.3%
Operating Profit					$48.2				$41.5				$6.6				16.0%
Operating Profit, before Special Items*					$48.2				$42.9				$5.3				12.3%
Profit Margin					15.1%				13.3%
Profit Margin, before Special Items*					15.1%				13.7%
*Repositioning charges of $1.4 million in 2012 primarily associated with transferring certain European production
to lower cost Company facilities.

Fourth quarter 2013 sales increased $7.1 million, or 2.3%, which included a core sales increase of $8.4 million (2.7%), and unfavorable foreign exchange of $1.3 million (0.4%). The segment sales increase was primarily driven by higher sales for process valves, partially offset by lower commercial valve volume in Canada, reflecting soft commercial construction end markets in that region. Excluding Special Items, segment operating margin increased from 13.7% to 15.1%, reflecting strengthening volume, continued operational execution, productivity gains and savings associated with the repositioning actions taken in 2012. Fluid Handling order backlog was $334 million at December 31, 2013, compared to $343 million at December 31, 2012. The lower backlog is driven by the timing of nuclear project based services.

2014 Guidance

Sales for 2014 are expected to be $3.0 billion, driven by a core sales increase of 1% - 3% and the impact of the MEI acquisition. Our 2014 earnings guidance is a range of $4.55 - $4.75 per diluted share, excluding Special Items as described below. This guidance reflects accretion of $0.20 per share contributed from the MEI acquisition (including $0.07 of synergies). On a comparable basis, 2013 earnings per share were $4.18. In connection with the recent acquisition of MEI, the Company expects to incur transaction and integration related costs, and inventory step up and backlog amortization charges in a range of $18 to $21 million. In addition, as part of ongoing efforts to continue to drive margin expansion, the Company expects modest facility repositioning actions relating to consolidation of certain smaller manufacturing sites. Associated costs are expected to be in the range of $10 to $13 million and are expected to be partially offset by gains from sales of certain real estate. Savings associated with these actions will approximate $5 million in 2015 and $10 million on an annual basis beginning in 2016. Including the aforementioned Special Items, our 2014 earnings guidance on a GAAP basis is $4.28 - $4.48 per diluted share. (Please see non-GAAP table for details.) Full year 2014 free cash flow (cash provided by operating activities less capital spending) is expected to be in a range of $225 to $250 million.

Segment-specific sales and operating profit guidance will be provided at the Company’s Investor Day conference on February 27, 2014.

Additional Information

Please see the Non-GAAP Financial Measures table attached to this press release for supporting details. Additional information with respect to the Company’s asbestos liability and related accounting provisions and cash requirements is set forth in the Current Report on Form 8-K filed with a copy of this press release.

Conference Call

Crane Co. has scheduled a conference call to discuss the fourth quarter financial results on Tuesday, January 28, 2014 at 10:00 A.M. (Eastern). All interested parties may listen to a live webcast of the call at http://www.craneco.com. An archived webcast will also be available to replay this conference call directly from the Company’s website.

Crane Co. Investor Day

The Company will hold its annual Investor Day conference on Thursday, February 27, in New York City from 8:30 am to noon and will be available on the web at www.craneco.com.

Crane Co. is a diversified manufacturer of highly engineered industrial products. Founded in 1855, Crane provides products and solutions to customers in the aerospace, electronics, hydrocarbon processing, petrochemical, chemical, power generation, automated merchandising, transportation and other markets. The Company has four business segments: Aerospace & Electronics, Engineered Materials, Merchandising Systems, and Fluid Handling. Crane has approximately 11,000 employees in North America, South America, Europe, Asia and Australia.

Crane Co. is traded on the New York Stock Exchange (NYSE:CR). For more information, visit www.craneco.com.

This press release may contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements present management’s expectations, beliefs, plans and objectives regarding future financial performance, and assumptions or judgments concerning such performance. Any discussions contained in this press release, except to the extent that they contain historical facts, are forward-looking and accordingly involve estimates, assumptions, judgments and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking statements. Such factors are detailed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012 and subsequent reports filed with the Securities and Exchange Commission.

(Financial Tables Follow)

CRANE CO.
Income Statement Data
(in thousands, except per share data)
		Three Months Ended						Twelve Months Ended
		December 31,						December 31,
			2013			2012			2013			2012
Net Sales:
Aerospace & Electronics		$	186,737		$	176,081		$	693,783		$	701,208
Engineered Materials			52,365			46,900			232,298			216,503
Merchandising Systems			122,649			94,160			380,576			371,901
Fluid Handling			319,698			312,647			1,288,624			1,289,456
Total Net Sales		$	681,449		$	629,788		$	2,595,281		$	2,579,068
Operating Profit (Loss) from Continuing Operations:
Aerospace & Electronics		$	44,719		$	39,181		$	159,976		$	156,015
Engineered Materials			5,809			3,344			34,347			24,522
Merchandising Systems			7,920			10,447			34,822			33,771
Fluid Handling			48,191			41,547			194,879			160,980
Corporate			(23,518)			(18,336)			(76,148)			(64,847)
Total Operating Profit from Continuing Operations			83,121			76,183			347,876			310,441
Interest Income			379			587			1,867			1,879
Interest Expense			(5,809)			(6,717)			(26,460)			(26,831)
Miscellaneous- Net			2,903			(181)			2,733			(884)
Income from Continuing Operations Before Income Taxes			80,594			69,872			326,016			284,605
Provision for Income Taxes			30,482			23,901			105,065			88,416
Income from Continuing Operations			50,112			45,971			220,951			196,189
Profit from Discontinued Operations attributable to common shareholders			-			-			-			3,777
Gain from Sales of Discontinued Operations attributable to common shareholders			-			-			-			29,445
Profit from Discontinued Operations attributable to common shareholders, net of tax			-			-			-			2,456
Gain from Sales of Discontinued Operations attributable to common shareholders, net of tax			-			-			-			19,176
Gain / Profit from Discontinued Operations, net of tax			-			-			-			21,632
Net income before allocation to noncontrolling interests			50,112			45,971			220,951			217,821
Less: Noncontrolling interest in subsidiaries' earnings			406			327			1,449			828
Net income attributable to common shareholders		$	49,706		$	45,644		$	219,502		$	216,993
Share Data:
Earnings per share from Continuing Operations		$	0.84		$	0.79		$	3.73		$	3.35
Earnings per share from Discontinued Operations			-			-			-			0.37
Earnings per Diluted Share (a)		$	0.84		$	0.79		$	3.73		$	3.72
Average Diluted Shares Outstanding			59,156			57,783			58,839			58,293
Average Basic Shares Outstanding			58,161			57,008			57,896			57,443
Supplemental Data:
Cost of Sales		$	454,598		$	417,569		$	1,711,759		$	1,708,240
Selling, General & Administrative			143,730			131,505			535,646			539,755
Repositioning Charges			-			4,531			-			20,632
Depreciation and Amortization *			16,678			14,141			54,837			57,263
Stock-Based Compensation Expense			6,492			4,459			22,791			17,319
* Amount included within cost of sales and selling, general & administrative costs.
(a) Earnings per share amounts may not add due to rounding

CRANE CO.
Condensed Balance Sheets
(in thousands)
								December 31,					December 31,
								2013					2012
ASSETS
	Current Assets
		Cash and Cash Equivalents					$	270,643				$	423,947
		Accounts Receivable, net						437,541					333,330
		Current Insurance Receivable - Asbestos						22,783					33,722
		Inventories, net						368,886					352,725
		Other Current Assets						30,295					36,797
			Total Current Assets					1,130,148					1,180,521
	Property, Plant and Equipment, net							305,055					268,283
	Long-Term Insurance Receivable - Asbestos							148,222					171,752
	Other Assets							692,345					455,530
	Goodwill							1,279,689					813,792
	Total Assets						$	3,555,459				$	2,889,878
LIABILITIES AND EQUITY
	Current Liabilities
		Notes Payable and Current Maturities of Long-Term Debt					$	125,826				$	1,123
		Accounts Payable						229,829					182,731
		Current Asbestos Liability						88,038					91,670
		Accrued Liabilities						223,172					220,678
		Income Taxes						2,062					15,686
			Total Current Liabilities					668,927					511,888
	Long-Term Debt							744,693					399,092
	Long-Term Deferred Tax Liability							76,347					36,853
	Long-Term Asbestos Liability							610,530					704,195
	Other Liabilities							238,289					310,474
	Total Equity							1,216,673					927,376
	Total Liabilities and Equity						$	3,555,459				$	2,889,878

CRANE CO.
Condensed Statements of Cash Flows
(in thousands)
									Three Months Ended														Twelve Months Ended
									December 31,														December 31,
										2013							2012							2013							2012
Operating Activities:
		Net income attributable to common shareholders							$	49,706						$	45,644						$	219,502						$	216,993
		Noncontrolling interest in subsidiaries' earnings								406							327							1,449							828
		Net income before allocations to noncontrolling interests								50,112							45,971							220,951							217,821
		Gain on divestiture								(2,727	)						-							(2,727	)						(29,445	)
		Restructuring - Non Cash								-							1,078							-							3,855
		Depreciation and amortization								16,678							14,141							54,837							57,263
		Stock-based compensation expense								6,492							4,459							22,791							17,319
		Defined benefit plans and postretirement expense								1,240							5,321							4,779							20,090
		Deferred income taxes								37,556							30,583							55,680							55,000
		Cash provided by (used for) operating working capital								66,850							81,146							(21,958	)						1,824
		Defined benefit plans and postretirement contributions								(2,744	)						(1,041	)						(15,929	)						(5,504	)
		Environmental payments, net of reimbursements								(4,201	)						(2,115	)						(15,403	)						(13,371	)
		Other								(6,311	)						(6,134	)						(763	)						(12,139	)
		Subtotal								162,945							173,409							302,258							312,713
		Asbestos related payments, net of insurance recoveries								(14,513	)						(17,906	)						(62,827	)						(77,957	)
		Total provided by operating activities								148,432							155,503							239,431							234,756
Investing Activities:
		Capital expenditures								(10,444	)						(9,364	)						(29,460	)						(29,308	)
		Proceeds from disposition of capital assets								83							4,184							455							6,438
		Payment for acquisition, net of cash acquired								(801,781	)						-							(801,781	)						-
		Proceeds from divestiture								6,836							480							6,836							54,079
		Total (used for) provided by investing activities								(805,306	)						(4,700	)						(823,950	)						31,209
Financing Activities:
		Dividends paid								(17,494	)						(15,976	)						(67,272	)						(61,974	)
		Reacquisition of shares on open market								-							-							-							(49,991	)
		Stock options exercised - net of shares reacquired								839							4,630							24,922							13,056
		Excess tax benefit from stock-based compensation								566							370							6,353							3,603
		Change in short-term debt								1,482							-							124,679							-
		New Debt								543,994							-							543,994							-
		Repayment of long-term debt								-							-							(200,000	)						-
		Total provided by (used for) financing activities								529,387							(10,976	)						432,676							(95,306	)
Effect of exchange rate on cash and cash equivalents										(5,274	)						3,584							(1,461	)						8,199
Increase (decrease) in cash and cash equivalents										(132,761	)						143,411							(153,304	)						178,858
Cash and cash equivalents at beginning of period										403,404							280,536							423,947							245,089
Cash and cash equivalents at end of period									$	270,643						$	423,947						$	270,643						$	423,947

CRANE CO.
Order Backlog
(in thousands)
		December 31,			September 30,			June 30,			March 31,			December 31,
		2013			2013			2013			2013			2012
Aerospace & Electronics		$	361,323		$	381,830		$	403,400		$	397,518		$	378,152
Engineered Materials			14,661			12,572			14,122			16,138			12,689
Merchandising Systems			51,888	*		23,901			25,641			21,399			14,686
Fluid Handling			333,860			355,192			349,545			365,231			343,370
Total Backlog		$	761,732		$	773,495		$	792,708		$	800,286		$	748,897
* Includes 31.9 million of backlog pertaining to the MEI/Conlux business acquired in December 2013.

CRANE CO.
Non-GAAP Financial Measures
(in thousands)
			Three Months Ended								Twelve Months Ended								Percent Change		Percent Change
			December 31,								December 31,								December 31, 2013		December 31, 2013
				2013				2012				2013				2012			Three Months		Twelve Months
		INCOME ITEMS
Net Sales			$	681,449			$	629,788			$	2,595,281			$	2,579,068			8.2	%	0.6	%
Operating Profit from Continuing Operations				83,121				76,183				347,876				310,441			9.1	%	12.1	%
Percentage of Sales				12.2	%			12.1	%			13.4	%			12.0	%
Special Items impacting Operating Profit from Continuing Operations:
Acquisition Transaction Costs (a)				10,170				3,874				22,765				3,874
Acquisition related inventory and backlog amortization (b)				4,654								4,654
Repositioning Charges (c)								4,531								20,632
Operating Profit from Continuing Operations before Special Items			$	97,945			$	84,588			$	375,295			$	334,947			15.8	%	12.0	%
Percentage of Sales				14.4	%			13.4	%			14.5	%			13.0	%
Net Income Attributable to Common Shareholders			$	49,706			$	45,644			$	219,502			$	216,993
Per Share			$	0.84			$	0.79			$	3.73			$	3.72			6.4	%	0.2	%
Special Items impacting Net Income Attributable to Common Shareholders:
Acquisition Transaction Costs - Net of Tax (a)				9,837			$	3,874				22,432			$	3,874
Per Share				0.17				0.07				0.38				0.07
Acquisition related inventory and backlog amortization - Net of Tax (b)				2,839								2,839
Per Share				0.05								0.05
Repositioning Charges - Net of Tax (c)								3,896								16,724
Per Share								0.07								0.29
Withholding taxes related to acquisition funding (d)				1,192								2,892
Per Share				0.02								0.05
Acquisition remedy related gain on sale of product line - Net of Tax (e)				(2,006	)							(2,006	)
Per Share				(0.03	)							(0.03	)
Gain on Divestitures - Net of Tax (f)																(19,176	)
Per Share																(0.33	)
Net Income Attributable To Common Shareholders Before Special Items			$	61,568			$	53,414			$	245,659			$	218,416			15.3	%	12.5	%
Per Share			$	1.04			$	0.92			$	4.18			$	3.75			12.6	%	11.4	%
Profit from Discontinued Operations attributable to common shareholders, net of tax				-				-				-				(2,456	)
Per Share															$	(0.04	)
Net Income Attributable To Common Shareholders Before Special Items from Continuing Operations			$	61,568			$	53,414			$	245,659			$	215,960
Per Share			$	1.04			$	0.92			$	4.18			$	3.70			12.6	%	12.7	%
						Three Months Ended								Twelve Months Ended
						December 31,								December 31,
				2013				2012				2013				2012
		Adjusted EBITDA Schedule (Non-GAAP)
		Net Income Attributable To Common Shareholders Before Special Items from Continuing Operations	$	61,568			$	53,414			$	245,659			$	218,416
		Interest, Net		5,430				6,130				24,593				24,952
		Provision for Income Taxes		30,717				23,901				103,600				88,416
		Depreciation and Amortization		16,678				14,141				54,837				57,263
		Stock Based Compensation		6,492				4,459				22,791				17,319
		Adjusted EBITDA from Continuing Operations (Non-GAAP)	$	120,885			$	102,045			$	451,480			$	406,366			18.5	%	11.1	%
(a) During the three and twelve months ended December 31, 2013, the Company recorded transaction costs associated with the potential acquisition of MEI/Conlux.
(b) During the three months ended December 31, 2013, the Company recorded inventory step-up and backlog amortization relating to the acquisition of MEI/Conlux.
(c) The Company incurred repositioning charges in the three and twelve months ended December 31, 2012, associated with productivity actions. The charges included severance and impairment costs related to the shutdown of certain facilities, the transfer of certain manufacturing operations, and staff reduction actions.
(d) In the three and twelve months ended December 31, 2013, the Company incurred withholding taxes related to cash marshaling activities supporting the acquisition of MEI/Conlux.
(e) In December 2013, the Company divested a product line within the Merchandising Systems segment pertaining to the execution of remedies associated with the MEI/Conlux acquisition.
(f) In June 2012, the Company divested a business within the Fluid Handling segment and a business within the Controls segment. The associated gains were included in the “Gain from Sale of Discontinued Operations attributable to common shareholders, net of tax" section on the accompanying Income Statement Data.
			2014 Full Year Guidance
		2014 Earnings Per Share Guidance	Low				High
		Earnings Per Share - GAAP basis	$	4.28			$	4.48
		Acquisition integration costs, inventory step-up and backlog amortization - Net of Tax(g)		0.22				0.22
		Anticipated facility repositioning actions, net of real estate divestiture gains - Net of Tax (h)		0.05				0.05
		Earnings Per Share - Non-GAAP basis	$	4.55			$	4.75
(g) In connection with the MEI/Conlux acquisition, the Company expects to incur transaction and integration related costs, and inventory step up and backlog amortization charges in a range of $18 million to $21 million. The $0.22 represents the estimated Earnings Per Share impact for the mid-point of the $18 million to $21 million range.
(h) In 2014, the Company expects to incur costs associated with facility repositioning actions related to the consolidation of certain smaller manufacturing sites and expects to record gains from the sale of certain Company owned real estate.
			Three Months Ended								Twelve Months Ended
			December 31,								December 31,
			2013				2012				2013				2012
CASH FLOW ITEMS
Cash Provided from Operating Activities
before Asbestos - Related Payments			$	162,945			$	173,409			$	302,258			$	312,713
Asbestos Related Payments, Net of Insurance Recoveries				(14,513	)			(17,906	)			(62,827	)			(77,957	)
Cash Provided from Operating Activities				148,432				155,503				239,431				234,756
Less: Capital Expenditures				(10,444	)			(9,364	)			(29,460	)			(29,308	)
Free Cash Flow			$	137,988			$	146,139			$	209,971			$	205,448
Certain non-GAAP measures have been provided to facilitate comparison with the prior year.
The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that non-GAAP financial measures which exclude certain non-recurring items present additional useful comparisons between current results and results in prior operating periods, providing investors with a clearer view of the underlying trends of the business. Management also uses these non-GAAP financial measures in making financial, operating, planning and compensation decisions and in evaluating the Company's performance.
The Company's definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net income before special items plus an add-back for net interest, provision for income taxes, depreciation, amortization and stock-based compensation. Adjusted EBITDA is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because Adjusted EBITDA provides additional information with respect to the Company’s operating performance.
In addition, Free Cash Flow provides supplemental information to assist management and investors in analyzing the Company’s ability to generate liquidity from its operating activities. The measure of Free Cash Flow does not take into consideration certain other non-discretionary cash requirements such as, for example, mandatory principal payments on the Company's long-term debt. Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.

Crane Co.
Richard E. Koch, 203-363-7352
Director, Investor Relations
and Corporate Communications
www.craneco.com