Valmont Industries Annual Report 2011

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FY2011 Annual Report · Valmont Industries

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Annual Report 2011

D o l l a r s i n M i l l i o n s, e x c e p t p e r s h a r e aMo u n t s

Operating Results

Net sales

Operating income

Net earnings1

Diluted earnings per share4

Dividends per share

Financial Position

financial highlights

2011

2010

2009

2,661.5

$ 1,975.5

$ 1,786.6

263.3

228.3

8.60

0.705

178.4

94.4

3.57

0.645

238.0

150.6

5.73

0.580

Shareholders’ equity2

1,147.0

915.9

786.3

Long-term debt as a % of invested capital3

26.8%

29.7%

15.6%

Operating Profits

Gross profit as a % of net sales

Operating income as a % of net sales

Net earnings as a % of net sales1

Return on beginning equity

Return on invested capital3

Year-End Data

Shares outstanding (000)

Approximate number of shareholders

Number of employees

25.1%

9.9%

8.6%

24.9%

11.0%

26,481

5,000

9,476

26.3%

9.0%

4.8%

12.0%

8.8%

26,374

5,200

9,188

1 Net earnings attributable to Valmont Industries, Inc.
2 Total Valmont Industries, Inc. shareholders’ equity.
3 See footnote (a) on page 36 of this document and item 6 on pages 21 through 22 of the attached Company’s Form 10-K.
4 Per share impact of tax benefit received ($2.49) as a result of legal entity restructuring.

29.8%

13.3%

8.4%

24.1%

15.6%

26,297

5,400

6,626

8.604

2,662

238.0

228.6

263.3

1,907

1,786

1,975

1,500

155.6

178.4

5.73

5.04

3.63

3.57

07 08 09 10 11

net sales

operating income

diluted earnings
per share

[ 1 ]

Financial highlights

message to Fellow shareholders

Valmont at a glance

doing more

engineered
infrastructure products

utility support structures

irrigation

coatings

26 global presence

Board of directors

corporate and
Business Unit Officers

corporate and stock information

Financial summary

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[ 2 ]

Valmont is recognized throughout the world as an industry
leader in engineered products and services for infrastructure,
and water conserving irrigation equipment for agriculture.
We grow our businesses by leveraging our existing products,
markets and processes. We recognize that our growth will
only create shareholder value if, at the same time, we exceed
our cost of capital. essential to our success is a company-wide
commitment to customer service and innovation, and the
ability to be the best cost producer for all products and services
we provide. recognizing that our employees are the cornerstone
of our accomplishments, we pride ourselves on being people
of passion and integrity who excel and deliver results.

valmont’s vision

[ 3 ]

message to FelloW
shareholders

2011 was a record year for Valmont. Revenue increased
35 percent and operating income increased 48 percent.
Operating income as a percent of sales improved from
9 percent to 9.9 percent. Net earnings were also at a
record level, and were enhanced by a one-time positive
adjustment during the fourth quarter. Our return on invested
capital improved to 11 percent from 8.8 percent in 2010.

It is gratifying to note that we delivered a record operating
performance despite the fact that our largest segment,
Engineered Infrastructure Products, experienced significant
headwinds in the North American and European markets.
Improved performance in our Irrigation, Utility Support
Structures and Coatings Segments more than offset
this softness.

Our 2010 acquisition of Delta plc was fully integrated this year.
International sales have now increased to more than 40
percent of Valmont’s total – providing more balance globally.
Our enhanced footprint in the Asia Pacific region should
drive approximately one quarter of total revenues in 2012.

This year we established a regional headquarters in
Sydney, Australia and appointed a group president who
is responsible for our Asia Pacific businesses. Through a
matrix management structure and overlaying geographic
responsibilities with our global product lines, we expect to
maximize our performance by sharing knowledge, research
and development between markets.

The successes of matrix organizational structures are
highly dependent on senior executives, with responsibility
for either product lines or geography, working well together.
I have been impressed with what I have seen.

Our Irrigation Segment had a great year. The market for
irrigation is strong for a number of reasons. Conserving the
world’s fresh water supply is an enduring global driver. Ever-
increasing global demands for food and the resulting good
crop prices are driving farm incomes. As a consequence,
farmer sentiment and capital investments in equipment
are robust. I have never seen a stronger macro environment
for our irrigation business. Our irrigation team and dealer
organization responded very effectively to a substantial
increase in sales volume and delivered record results.

The Utility Support Structures Segment delivered much
improved results compared to 2010. Electric utility companies
in North America increased capital spending on large-
scale projects to add physical capacity and improve the
reliability of the grid. We expect spending to remain strong
for a number of years as utilities connect alternative energy
sources to the grid and upgrade their transmission
and distribution network.

[ 4 ]

We are ideally positioned – through our products,
capabilities and market presence – to help meet
the needs of a growing population worldwide.

In 2011, our structural businesses serving the lighting,
traffic and telecommunication markets faced difficult
markets. Weak government spending in the U.S. and
Europe reduced global demand for highway lighting
and other traffic structures. Limited demand and volatile
steel costs compressed prices and margins in a highly
competitive market, leading to unsatisfactory results.
We believe infrastructure is a growth business; economic
growth depends on investments in infrastructure.
We remain confident in the longer-term prospects for
these businesses. While we do not anticipate much
improvement in market conditions in 2012, we do expect
continued progress increasing productivity, streamlining
operations and reducing costs. Therefore, we believe
that earnings in this segment will improve. Our other
businesses within this segment in the Asia Pacific
region, such as engineered access systems and
highway safety products, performed to expectations.

Our Coatings Segment had a strong performance despite
operating in a generally weak economy. Increased captive
demand from Valmont’s Utility and Irrigation Segments
in North America provided beneficial leverage. We are
driving productivity improvements by continually sharing
best practices in our galvanizing operations in North
America and the Asia Pacific region.

We have several other businesses that are not as large
as the four in our segments. These businesses made
a meaningful contribution to our results in 2011. The tubing
business benefited from the strong agricultural economy.
Our grinding media business in Australia saw good
demand from the mining industry. Our electrolytic
manganese dioxide business in South Africa benefited
from stable market conditions and favorable foreign
exchange rates.

As I visit our facilities and meet with customers worldwide,
I am gratified by the passion and commitment of our teams
at every level. The customer-driven innovations and service
models that are shared within and among units support
Valmont’s culture of continuous improvement and build
the platform necessary for our further growth.

Valmont anticipates another record year from operations
in 2012. We expect market conditions for the Utility
Support Structures Segment to continue to strengthen.
We expect improved performance in our Engineered

Infrastructure Products Segment, even absent a better
market environment. Both our Coatings and Irrigation
Segments should continue their strong performance.
The agricultural economy will continue to be driven by
the need for food and water management as growing
middle class populations move towards higher protein
diets, increasing demand for feed grains.

We cannot control economic conditions; however,
Valmont will continue to leverage our products, markets
and capabilities. We will maintain our focus on productivity,
safety and customer engagement. The world’s increasing
investments in infrastructure enhancements and water
conservation solutions to help secure food supply are
inevitable. Valmont is constantly scanning the horizon
for potentially disruptive designs or technologies. We are
confident that mechanized irrigation is the best means
of water delivery for large-scale agriculture. Our structural
support products remain the best way to support objects
in the air. Galvanizing is the best coating to extend the
product life of steel. We are ideally positioned – through
our products, capabilities and market presence – to help
meet the needs of a growing population worldwide.

We welcomed two new members to our Board:
James B. Milliken, President of the University of Nebraska,
and Catherine Paglia, a director of Enterprise Asset
Management, Inc. We are looking forward to benefiting
from their experience and counsel.

At the end of 2011, Clarice Barnhill retired. For more than
60 years, Clarice was the devoted Executive Secretary
to our founder Robert B. Daugherty. She is the supreme
ambassador of the Valmont culture. Our company is
undoubtedly better for her loyal service and warmth.
We wish her well in her retirement.

Thank you for your continued support and shared
enthusiasm. I look forward to updating you on our
progress in the year ahead.

Sincerely,

Mogens C. Bay
Chairman and Chief Executive Officer

[ 5 ]

infrastructure

coatings

Galvanizing, anodizing and powder coatings

irrigation

Mechanized irrigation systems

Valmont

at a glance

[ 6 ]

Wherever you live, whatever you do, chances are Valmont is part of your life.

engineered products for infrastructure and water management for agriculture.

engineered inFrastructure products
area lighting poles for parking lots and public areas · sports lighting structures for arenas and
stadiums · Decorative lighting poles · traffic and sign structures · street and high-mast lighting
poles · structures and components for wireless communication · highway safety products ·
industrial grating and access systems

utility support structures

utility transmission and distribution poles · utility substation structures

agriculture

[ 7 ]

doing more...

[ 8 ]

pursuing opportunities for growth
Population growth and economic development are increasing the world’s
demands for quality infrastructure and sustainable agriculture.

Valmont is pursuing opportunities for growth by leveraging our products and
services, knowledge of new and existing markets, and capabilities; while
consistently delivering value for our customers. True to our vision, we focus
product and process innovations on the global markets for infrastructure
and agriculture to maximize our strengths.

PRODucts
Valmont is pursuing opportunities for growth by bringing our existing
products into markets that may be new for us. A combination
of regional manufacturing and product differentiation allows
us to customize products to quickly respond to the specific
needs of local customers.

MaRkEts
We pursue growth opportunities by bringing new products
to markets and customers that we know well, leveraging
longstanding relationships and a comprehensive understanding
of end-user needs. Doing so enables us to strategically increase
the benefit we provide to those who already rely on Valmont.

caPabilitiEs
By leveraging internal knowledge and skills company-wide,
we discover ways to exceed expectations while responding
to our customers’ needs.

custOMERs
Maximizing the customer experience is central to Valmont’s vision.
We are constantly in pursuit of excellence so that we are able
to consistently and efficiently deliver the highest quality results,
with integrity and a shared sense of urgency.

You will notice that these enduring concepts and symbols emerge throughout
the report. Please reflect on the connections they forge between the deliberate
growth of each segment and Valmont’s overall value proposition.

[ 9 ]

emil Frankel
Bipartisan policy center (Bpc) Visiting scholar

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[ 10 ]

“america’s transportation infrastructure has been the foundation

of the nation’s prosperity since before the united states was even

established,” said Emil Frankel, bipartisan Policy center (bPc)
Visiting scholar. “in our work at the Bpc, we have
advocated for the importance of critical
transportation investments, in order to
enhance economic recovery and growth,
and improve regional and national
connections. But today, because our resources are
constrained, we must invest wisely, maximize returns on our

existing systems, and use those assets more productively.”

Frankel is the former commissioner of the

national connectivity, metropolitan accessibility,

Connecticut Department of Transportation

energy security and environmental sustainability,

(1991-1995) and former assistant secretary

and safety. The Project advocates reform, including

of transportation policy of the U.S. Department

increased funding for research and planning, so that

of Transportation (2002-2005). He has devoted

state and metropolitan institutions have the capacity

his career to issues of transportation, energy,

and motivation to implement comprehensive,

environmental policy and public management.

strategic and performance-driven capital programs.

The BPC’s National Transportation Policy Project

directed by Frankel has recommended five goals for

U.S. surface transportation policy: economic growth,

Valmont’s drive to create sustainable infrastructure

systems complements these goals.

[ 11 ]

engineered infrastructure products

strengthening foundations.

products
Growth in the Engineered Infrastructure Products segment
will come through urbanization in developing countries,
and by meeting the demand for new and upgraded
infrastructure in developed markets where product
needs include residential decorative lighting poles
and citywide traffic and transportation systems.

With a broad range of infrastructure products, from high-
way safety barriers to support structures to engineered
access systems, Valmont can participate in infrastructure
development opportunities around the globe. For example,
in the Asia Pacific region, technological innovation has
allowed us to introduce an exciting new guardrail product
in Australia. Our Webforge® brand of engineered grating
and access systems provides a strong growth platform
to participate in the region’s burgeoning mining
and infrastructure investment.

markets
Despite reduced government spending on infrastructure
in 2011, particularly in North America and Europe,
opportunities for Valmont to grow are plentiful. Growth
strategies are in place around the globe to bring Valmont
products to markets where we already have a presence.

For example, our innovative decorative wood lighting pole
products are finding new demand in European markets.

We are also proud of our work with customers who wish
to highlight unique community identities with customized
structures and cityscapes. In 2011, Valmont teams in the

[ 12 ]

strengthening foundations.

U.S. completed a picturesque, multi-level custom bridge
project in Austin, TX, as well as a signature “Welcome”
sign in Monrovia, CA. Many municipalities in Europe hold
elections during which mayors make a point to invest
money in infrastructure. We anticipate that decorative
lighting opportunities in those cities will increase.

capabilities
Though each Valmont facility is unique, locations world-
wide share best practices to make sure that customer
needs are optimally met.

Mindful that our natural resources are finite and energy
is becoming more costly, Valmont optimizes designs
to reduce waste, and maximizes usage of recyclable
materials like steel and aluminum. Conscious of
aesthetics as well, many structures are designed

to inconspicuously blend with the surroundings –
in harmony with natural environments.

Environmental responsibility includes not only driving
change, but also responding to it. In the lighting market,
Valmont is participating in the shift from incandescent
lighting to LED through modified pole structure solutions.

customers
Building strong relationships with customers is becoming
increasingly collaborative. Valmont is focusing on customer-
centric metrics, like delivery speed and quality, by offering
better engineering support at a quicker pace and working
with third-party testing facilities to continually enhance our
technical skills. By establishing multiple sites in different
regions, we ensure that products and support services
have a local presence, enabling us to remain competitive
in key global markets.

building communities.

[ 13 ]

robert l. daileader, Jr.
partner at nixon peabody llp

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[ 14 ]

“as the electric industry continues to transition from vertical integration

to a more competitive model, and environmental considerations lead

us away from fossil fuels toward renewable energy sources, we are

retiring older generation and building more efficient units,” said Robert

l. Daileader, Jr., Partner at Nixon Peabody llP. “What will remain

constant, in my view, is the [united states’] absolute need to modernize

and expand the transmission grid so that new generation can reach

people in a reliable and cost-effective manner.

“although there will continue to be disputes between policy-makers

and regulators about how decisions are made in terms of transmission
planning and cost recovery and allocation, I am confident
that there will continue to be consensus at
both the federal and state levels that more
transmission is needed, and that policies
to encourage investment in upgrading
the grid need to be in place.”

Daileader concentrates his practice at Nixon

as well as the corresponding regulatory

Peabody – in Energy, Energy Transactions,

approvals. He is currently representing clients

Project Finance and Project Counsel – on a wide

in the development of several transmission upgrade

range of energy and public utility issues. Over

projects throughout the U.S.; and is in agreement

the past several years, he has participated in

with Valmont and Valmont customers that

transactions involving the development and

it is imperative to advance an environmentally

financing, and purchase and sale, of numerous

conscious power transmission system

electric generation and transmission facilities,

of the utmost efficiency and reliability.

[ 15 ]

utility

powering opportunities.

products
As countries in Central America, South America, Africa
and Asia develop, people are looking to improve their
standard of living. In fact, over 1.6 billion people in the
world still do not have electricity. Consequently, the
demand for electrical power is increasing. Valmont
is penetrating new markets and stimulating growth
by providing the transmission and distribution
infrastructure to connect communities.

We have entered into India during this unprecedented
period of rapid industrialization, which requires
construction of new power transmission lines, lighting
and telecommunication poles, and electrified rail systems.
In increasingly congested urban spaces of the Asia Pacific
region, existing lattice tower structures
have large physical footprints. Our new
pole plant and galvanizing operation

in India will supply monopole towers that conserve
valuable land area in one of the most populated regions
in the world.

markets
Our utility business is seeing more activity in North
American markets than ever before. U.S. investment
in utility transmission reached nearly $13 billion in 2011 –
more than three times higher than just a decade ago.1
Utility customers are upgrading transmission lines across
the nation to respond to the demand for reliable higher
voltage transmission and renewable wind and solar energy.

In particular, there is a major emphasis on transmitting
power from remote wind farm locations to consumers in
heavily-populated urban areas. One example is in Texas,

[ 16 ]

powering opportunities.

where the Competitive Renewable Energy
Zones (CREZ) Project has designated five
wind-generated energy facilities across the
state. Valmont is providing concrete, steel and
hybrid poles to large utilities and other utility
service companies constructing more than 4,000 miles
of transmission lines to support this ambitious project.

Although a complete transmission grid is not yet in place
to connect all of the United States as the interstate high-
way system does, Valmont support structures are playing
a significant role in its development.

capabilities
Because power is more efficiently transmitted at
a higher voltage, we are continually exploring the
most cost-effective engineered solutions to maximize
transmission structure productivity by modifying design
and combining materials.

customers
Valmont collaborates with utility customers to conceive
truly optimal material and design solutions that meet the
world’s increasing demand for power. Steel, concrete or
hybrid poles are the ideal structures to serve customer
needs depending upon the accessibility, terrain, climate
and soil conditions of a given area, as well as aesthetic
preference. Substituting lattice towers with monopoles
conserves steel, space and visual impact.

1Wamsted, Dennis J. “Tangible Results: Utilities across the nation use Federal
Energy Regulatory Commission transmission construction incentives to build
a host of new projects.” Electric Perspectives, Vol. 36, No. 5,
September/October 2011, 35.

energizing connections.

[ 17 ]

dr. Kenneth g. cassman
heuermann professor of agronomy chair at the university of nebraska at
lincoln and chair of the independent science & partnership council (ispc)
of the consultative group on international agricultural research (cgiar)

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[ 18 ]

“
By 2050, 70 percent of our human population
will live in cities. there is no way that we will
be able to supply an urban population of
that magnitude without substantial investment
in irrigated agriculture,” said Dr. kenneth G. cassman,
Heuermann Professor of agronomy at the university of Nebraska at

lincoln and chair of the independent science & Partnership council

(isPc) of the consultative Group on international agricultural

Research (cGiaR). “having said this, it’s clear we are not going to

have more water. that’s where companies like Valmont – concerned

with the efficiency of water use – come in. You can’t cut down every

forest and you can’t drain every swamp; we have to double the yields

on existing land and we have to do that with the same amount

of water. That’s got to be one of the most significant challenges

facing humankind. . . . it’s clear to me that irrigation is fundamental,

and companies improving it have to play a leading role.”

Dr. Cassman has had the opportunity to work in

investment in the expansion of irrigated agriculture

nearly every major agricultural production system

such that, today, more than one-third of all crop land

worldwide during his career, and was among the

in Asia is irrigated.

first to predict that food prices must rise, threatening

economic development, unless major agricultural

initiatives were undertaken on a global scale. The

“green revolution” in Africa, where there is tremendous

poverty, food insecurity and malnutrition, is a focus

of Dr. Cassman’s. He compares it to the most recent

green revolution in Asia made possible by several

components – not the least of which was massive

Valmont shares Dr. Cassman’s passion for responding

to the increasing demand for sustainable food
sources, as well as the critical need for conservation

of our limited freshwater supply.

[ 19 ]

irrigation

sustaining resources.

products
Seven billion people in the world need food. Mechanized
irrigation provides a highly efficient means to sustain
precious water supply and farmland to generate the
food that improving diets require.

Through our global network of manufacturing locations
and dealers, we can demonstrate to growers the benefits
of mechanized irrigation equipment over traditional flood
irrigation methods. This, in turn, will help growers conserve
resources and become better stewards of their land.

Our model for international growth, honed in markets
such as Brazil and South Africa, is now being applied
to other geographies. For example, our China
manufacturing operation has been operating for
over a year using equipment and processes
perfected in North and South America,
and South Africa.

As a result of years of sales efforts in China, we expect
growing demand and anticipate that the Chinese
government will strive to become more self-sufficient
and rely less on imports. Likewise, we see great potential
for growth in Russia and other neighboring countries over
the next several years due to greater public and private
investment in agriculture.

markets
Irrigation was the foundation of Valmont’s business in
North America over a half-century ago and our global
leadership in the industry continues. Recognizing that
food production will need to double within the next 40
years using less water and land, we expect the use

[ 20 ]

of our products to accelerate in both developed and
emerging markets. Replacement of aging irrigation
equipment in North America will continue as producers
work to optimize crop yields for fiber, row crops,
bio-diesel and ethanol.

We have a significant opportunity to explore new applica-
tions for and increase adoption of mechanized irrigation
technology worldwide. With our global network of plants,
we have the opportunity to reach virtually every grower
and help countries become self-sufficient food producers.

capabilities
Only one percent of the world’s water is available for
human consumption, and agriculture already uses 70
percent of it. Mechanized irrigation improves efficient
water usage up to 70 percent, as compared to flood
methods. We continue to explore innovative methodolo-
gies to ensure that our Valley® brand center-pivot and

linear irrigation equipment continues to be synonymous
with quality and reliability.

Equally critical to our success is our global network
of dealers who share a passion for our products,
personalized service and continuous improvement.

customers
Valmont is driven to develop products that make life better
for producers of food, fiber and biofuels. With an absolute
commitment to both agriculture and infrastructure, we are
working to provide solutions to help meet the needs of the
9 billion people our planet will hold by 2050.

Our manufacturers and dealers around the world are
dedicated to making each year more productive than
the last.

nourishing futures.

[ 21 ]

lawrence Kavanagh
president of the steel market development institute

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[ 22 ]

“
For the past 15 years, Valmont has worked closely with the

steel market development institute and other partners to bring

cost-effective and reliable electricity delivery solutions to north

america with galvanized steel utility distribution poles,” said

lawrence kavanagh, President of the steel Market Development
institute. “a key part of our business strategy
is directly engaging management at the
electric utility companies to discuss how
steel poles can meet the ever-increasing
demands for electricity distribution networks,
e.g., by galvanizing to ensure strength
and long life.

We appreciate Valmont’s commitment and leadership in growing
“

the market for steel poles, which now includes major power

distributors like tucson electric power and san diego gas & electric.”

The Steel Market Development Institute (SMDI)

is a business unit of the American Iron and Steel

Institute. Valmont is a founding member of the

organization’s Steel Utility Pole Task Group.

[ 23 ]

coatings

protecting materials.

products
Protected from corrosion, fabricated steel products look
better and last longer. What began as an operation to
best preserve the life of our own products has quickly
become an opportunity to enhance product lives in new
markets globally. Developing countries are allocating
financial resources to extend the service lives of their
critical infrastructure investments.

With 12 existing galvanizing operations in Australia and
Southeast Asia, a new plant opening in India in April
2012, and a total of 17 plants in North America, Valmont
now has a presence in many high-growth markets. We
are coating a variety of steel materials such as highway
products, communication towers, sign structures and
structural steel used in petrochemical plants.

markets
Fifteen years ago, 98 percent of the galvanizing performed
at our single plant in Valley, Nebraska was for Valmont
products. Now, coating our own products represent less
than one-fifth of our total volumes; the remaining volumes
are commercial – touching nearly every industry in North
America, Australia and Southeast Asia.

Due to the robust corrosion-protective characteristics of
galvanization, we are continually seeking new applications
and responding to shifts in the diverse array of adjacent
markets we already serve. For example, as the demand
for power and new alternative energy technologies
increases, so does the need for lasting petrochemical
and utility support infrastructure.

[ 24 ]

protecting materials.

capabilities
The diversity of the markets for which we provide
protective coatings, both internal and external, is the
reason for our success and further growth opportunities.
We are able to exchange knowledge with and leverage
competencies from our recently acquired facilities
in the Asia Pacific region to match environmentally-
conscious processes.

Hot-dip galvanizing combines two sustainable products:
fabricated steel and molten zinc. By using these materials
wisely, we are enabling investments in critical infrastructure
and other products to last up to 50 or 100 years.

customers
Although Valmont’s Coatings customers are primarily
industrial, consumers come in contact with our coatings
daily in recreation, agriculture, energy and transportation.
Valmont’s coatings services enhance and protect the
physical and financial well-being of our communities.

Every detail of our process is considered, down
to the chemistries of the zinc bath used in the coating.
Galvanizing helps safeguard our roads and bridges from
premature corrosion. It helps our neighborhoods with
long-lasting poles for power and lighting. Galvanization
of critical infrastructure, to extend the service life
of products, is a good investment in the future.

maximizing capabilities.

[ 25 ]

KEY

Plant location

Multiple plant locations

Corporate headquarters

global
presence

[ 26 ]

KEY

Plant location

Multiple plant locations

Corporate headquarters

throughout the world, our dedicated employees
strive to make a difference - at work, at home,
and in their communities.

[ 27 ]

global
presence

africa
Berrechid, Morocco
Steel Poles

Johannesburg, South Africa
Irrigation Equipment

Nelspruit, South Africa
Manganese Metal Alloys and
Electrolytic Maganese Dioxide

Asia Pacific
Pune, India
Steel Poles and Galvanizing

australia
Acacia Ridge, Queensland
Steel Poles

Bassendean, Western Australia
Grinding Media

Bohle, Townsville Queensland
Galvanizing

Bohle, Townsville Queensland
Grinding Media

Campbellfield, Victoria
Galvanizing

Carole Park, Queensland
Galvanizing

Clayton South, Victoria
Access Systems

Maddington, Western Australia
Steel Poles

Guangzhou
Access Systems

Mayfield, New South Wales
Grinding Media

Guangzhou
Steel Poles

Minto, New South Wales
Highway Safety Products

Mona Vale, New South Wales
Access Systems

Pinkenba, Queensland
Access Systems

Pinkenba, Queensland
Galvanizing

Port Kembla, New South Wales
Galvanizing and
Zinc Reclamation

Haiyang
Steel Poles
and Irrigation Equipment

Shanghai
Steel Poles

Wuxi, Jiangsu P.C.
Access Systems

europe
& middle east
Kiiu, Estonia
Steel Poles

Silverwater, New South Wales
Architectural Metal Coverings

Kangasniemi, Finland
Steel and Wood Poles

Spearwood, Western Australia
Galvanizing

Welshpool, Western Australia
Access Systems

Parikkala, Finland
Wood Poles

Charmeil, France
Steel Poles

canada
Delta, British Columbia
Steel Poles

Winnipeg, Manitoba
Steel Poles

Girraween, New South Wales
Galvanizing

Barrie, Ontario
Steel Poles

Hexham, New South Wales
Galvanizing

St. Julie, Québec
Steel and Aluminum Poles

Launceston, Tasmania
Galvanizing

china
Chengdu, Sichuan
Access Systems

[ 28 ]

Rive-de-Gier, France
Aluminum Poles

Gelsenkirchen, Germany
Steel Poles

Maarheeze, The Netherlands
Steel Poles

Siedlce, Poland
Steel Poles

Madrid, Spain
Irrigation Equipment

Jebel Ali, U.A.E.
Irrigation Equipment

Stockton-on-Tees,
United Kingdom
Steel Poles

mexico
Monterrey
Steel Poles

new Zealand
Palmerston North
Access Systems

south america
Uberaba, Brazil
Irrigation Equipment

southeast asia
Jalan Jababeka, Indonesia
Access Systems

Jaya, Selangor, Malaysia
Galvanizing

Nilai, Negeri Sembilan,
Malaysia
Galvanizing

Selangor Darul Ehsan,
Malaysia
Access Systems

Cabuyao, Laguna,
Philippines
Access Systems

Trece Martires City, Cavite,
Philippines
Galvanizing
and Steel Poles

Rayong, Thailand
Access Systems

united states
Bay Minette, Alabama
Concrete Poles

Steele, Alabama
Galvanizing

Tuscaloosa, Alabama
Concrete Poles

Barstow, California
Concrete and Steel Poles

Long Beach, California
Galvanizing

Los Angeles, California
Anodizing and
Powder Coating

Elkhart, Indiana
Aluminum Extrusions

Jeffersonville, Indiana
Galvanizing

Plymouth, Indiana
Wireless Communication
Structures, Components
and Specialty Structures

Sioux City, Iowa
Galvanizing

El Dorado, Kansas
Steel Poles

Salina, Kansas
Galvanizing

Santa Fe Springs, California
Wireless Components

Farmington, Minnesota
Aluminum Poles

Minneapolis, Minnesota
Powder Coating
and E-Coating

McCook, Nebraska
Irrigation Equipment

Omaha, Nebraska
Corporate Headquarters

Valley, Nebraska
Irrigation Equipment,
Steel Poles, Tubing
and Galvanizing

Aurora, Colorado
Composite Poles

Bartow, Florida
Concrete Poles

Miami, Florida
Galvanizing

Tampa, Florida
Galvanizing

Atlanta, Georgia
Wireless Components

Claxton, Georgia
Concrete Poles

Chicago, Illinois
Galvanizing

Tulsa, Oklahoma
Steel Poles
and Galvanizing

Salem, Oregon
Wireless Communication
Structures, Components
and Specialty Structures

Tualatin, Oregon
Galvanizing

Hazleton, Pennsylvania
Steel Poles

West Columbia,
South Carolina
Galvanizing

Jasper, Tennessee
Steel Poles

Bellville, Texas
Concrete Poles

Brenham, Texas
Steel Poles

Mansfield, Texas
Steel Poles

Lindon, Utah
Galvanizing and
Powder Coating

Petersburg, Virginia
Galvanizing

West Point, Nebraska
Galvanizing

Ferndale, Washington
Steel Poles

Hauppauge, New York
Wireless Components

[ 29 ]

top, from left to right: Glen a. Barton, Mogens c. Bay, Kaj den Daas.
Middle, from left to right: Dr. stephen r. lewis, Jr., James B. Milliken, Daniel p. neary.
Bottom, from left to right: catherine J. paglia, ambassador clark t. randt, Jr., Walter scott, Jr., Kenneth e. stinson

Mogens C. Bay
Chairman and
Chief Executive Officer
Valmont Industries, Inc.
Director Since 1993

Kenneth e. stinson
Lead Director
Chairman
Peter Kiewit Sons’, Inc.
Director Since 1996

Glen A. Barton
Retired Chairman and
Chief Executive Officer
Caterpillar, Inc.
Director Since 2004

Kaj den daas
Retired Executive
Vice President
Philips Lighting, B.V.
of the Netherlands
Director Since 2004

dr. stephen R. lewis, Jr.
Chairman
Columbia – RiverSource Funds
Director Since 2002

James B. Milliken
President
University of Nebraska
Director Since 2011

daniel P. neary
Chairman and
Chief Executive Officer
Mutual of Omaha
Director Since 2005

Catherine J. Paglia
Director Enterprise
Asset Management
Director Since 2012

Ambassador Clark t. Randt, Jr.
Former U.S. Ambassador to
the People’s Republic of China
Director Since 2009

Walter scott, Jr.
Chairman
Level 3 Communications, Inc.
Director Since 1981

Audit CoMMittee
Walter Scott, Jr., Chairman
Kaj den Daas
Daniel P. Neary
Catherine J. Paglia

HuMAn ResouRCes
CoMMittee
Glen A. Barton, Chairman
Dr. Stephen R. Lewis, Jr.
Daniel P. Neary
Kenneth E. Stinson

GoveRnAnCe And
noMinAtinG CoMMittee
Dr. Stephen R. Lewis, Jr., Chairman
Ambassador Clark T. Randt, Jr.
Glen A. Barton

inteRnAtionAl CoMMittee
Kaj den Daas, Chairman
Mogens C. Bay
Ambassador Clark T. Randt, Jr.
James B. Milliken

s
r
o
t
c
e
r
d
f
o
d
r
a
o
b

[ 30 ]

officers

corporate & Business unit

corporate Officers
MoGens c. Bay
Chairman &
Chief Executive Officer

toDD G. atKinson
Executive Vice President &
Corporate Secretary

Vanessa BroWn
Vice President
Human Resources

stephen KanieWsKi
Vice President
Information Technology

terry J. Mcclain
Senior Vice President &
Chief Financial Officer

Brian DesiGio
Vice President
Corporate Development

MarK c. JaKsich
Vice President &
Corporate Controller

Walter p. pasKo
Vice President
Procurement

Operations & Management
utility suPPoRt stRuCtuRes
earl R. Foust
Group President

Michael Banat
Vice President & General Manager

International Utility

James P. Ruddy
President, Steel Business Units

steven A. schmid
Vice President Operations &
General Manager
Concrete

douglas C. sherman
Vice President
Business Development

iRRiGAtion
leonard M. Adams
Group President
Global Irrigation

stephen B. leGrand
Vice President Operations
Global Irrigation

Craig Malsam
Vice President
Engineering & Marketing
Global Irrigation

Richard J. Panowicz
Vice President Sales
North American Irrigation

Aaron schapper
Vice President & General Manager

International Irrigation

CoAtinGs And tuBinG
Richard s. Cornish
President
Valmont Coatings & Tubing Divisions

euRoPe, Middle eAst
And AFRiCA ReGion
todd G. Atkinson
President

liGHtinG, tRAFFiC And
CoMMuniCAtion stRuCtuRes
earl R. Foust
Group President

todd P. Barth
President
Lighting, Traffic &
Communication Structures

ted Brockman
Vice President & General Manager
Valmont-West Coast Engineering

Gary P. King
Vice President Operations
General Manager Canada

Jason n. Palumbis
Vice President
Sales & Marketing
General Manager
Communication Structures

thomas F. sanderson
Vice President
Product & Market Development

Mark e. treinen
Vice President
Controller &
Business Development

daniel e. Witt
Vice President
Customer Engagement
General Manager, Specification

Piet stevens
Vice President &
General Manager
Europe, Middle East & Africa

stéphane devulder
Director of Operations
Europe, Middle East & Africa

AsiA PACiFiC ReGion
vik Bansal
Group President

Huang Xiao yong
President, China

david Wong
Managing Director, Asia

Paul Gee
Managing Director
Webforge Australia/New Zealand

Peter Hogan
Managing Director

Industrial Galvanizers Australia

Paul shelley
Managing Director, Donhad Pty Ltd

sandy Robertson
Managing Director, Ingal EPS

viswanath devrajan
Managing Director, India

[ 31 ]

corporate and stocK

information

corporate headquarters
Valmont Industries, Inc.
One Valmont Plaza
Omaha, Nebraska 68154-5215 USA
Tel
Fax
Online valmont.com

1-402-963-1000
1-402-963-1198

independent public
accountants
Deloitte & Touche LLP
Omaha, Nebraska USA

legal counsel
McGrath North Mullin & Kratz,
PC LLO
Omaha, Nebraska USA

stock transfer agent
and registrar address
shareholder inquiries to:
Wells Fargo Shareowner Services
161 N. Concord Exchange
South St. Paul, Minnesota 55075
1-866-886-9962

Send Certificates for
transfer and address
changes to:
Wells Fargo Shareowner Services
161 N. Concord Exchange
South St. Paul, Minnesota 55075
1-866-886-9962

annual meeting
The annual meeting of Valmont’s shareholders will be held at 2:00 p.m.
on Tuesday, April 24, 2012, at the Omaha Marriott Hotel,
10220 Regency Circle in Omaha, Nebraska USA.

shareholder and investor relations
Valmont’s common stock trades on the New York Stock Exchange (NYSE)
under the symbol VMI.

We make available, free of charge through our Internet website at
www.valmont.com, our annual report on Form 10-K, quarterly reports
on Form 10-Q, current reports on Form 8-K, and amendments to those
reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as soon as reasonably practicable after such
material is electronically filed with or furnished to the Securities and
Exchange Commission.

We have also posted on our website our (1) Corporate Governance
Principles, (2) Charters for the Audit Committee, Human Resources
Committee, Governance and Nominating Committee and International
Committee of the Board, (3) Code of Business Conduct, and (4) Code
of Ethics for Senior Officers applicable to the Chief Executive Officer,
Chief Financial Officer and Controller. Valmont shareholders may also
obtain copies of these items at no charge by writing to:

Jeffrey S. Laudin

Investor Relations Department
Valmont Industries, Inc.
One Valmont Plaza
Omaha, Nebraska 68154 USA
1-402-963-1000
Tel
1-402-963-1198
Fax

[ 32 ]

financial

summary

[ 33 ]

selected 5-year financial summary

D o l l a r s i n t h o u s a n D s , e xc e p t p e r s h a r e a m o u n t s

Operating Data

net sales
operating income
net earnings1
Depreciation and amortization
capital expenditures

per Share Data

earnings:
Basic
Diluted

cash dividends declared

Financial pOSitiOn

Working capital
property, plant and equipment, net
total assets
long-term debt, including
current installments

shareholders’ equity2

caSh FlOw Data

net cash flows from operations
net cash flows from
investing activities
net cash flows from
financing activities

Financial MeaSureS (e)

invested capital(a)

return on invested capital(a)
eBitDa(b)
return on beginning

shareholders’ equity(c)
long-term debt as a percent

of invested capital(d)

Year-enD Data

shares outstanding (000)
approximate number
of shareholders
number of employees

see footnotes on page 36.
1 net earnings attributable to Valmont industries, inc.
2 total Valmont industries, inc. shareholders’ equity.

2011

2010

2009

2008

2007

$ 2,661,480
263,310
228,308
74,560
83,069

$ 1,975,505
178,413
94,379
59,663
36,092

$ 1,786,601
237,994
150,562
44,748
44,129

$ 1,907,278
228,591
132,397
39,597
50,879

$ 1,499,834
155,626
94,713
35,176
56,610

8.67
8.60
0.705

3.62
3.57
0.645

5.80
5.73
0.580

5.13
5.04
0.495

3.71
3.63
0.410

$ 844,873
454,877
2,306,076

$ 747,312
439,609
2,090,743

$ 458,605
283,088
1,302,169

$ 475,215
269,320
1,326,288

$ 350,561
232,684
1,052,613

474,650
1,146,962

468,834
915,892

160,482
786,261

338,032
624,131

223,248
510,613

$ 149,671

$ 152,220

$ 349,520

52,575

$ 110,249

(84,063)

(262,713)

(43,595)

(194,077)

(71,040)

(45,911)

269,685

(198,400)

108,753

(210)

$ 1,769,461

$ 1,577,707

$ 1,029,970

$ 1,043,684

$ 794,786

11.0%

8.8%

15.6%

16.4%

14.5%

$ 343,633

$ 239,997

$ 283,964

$ 260,474

$ 191,635

24.9%

26.8%

12.0%

29.7%

24.1%

25.9%

15.6%

32.4%

23.6%

28.1%

26,481

26,374

26,297

26,168

25,945

5,000
9,476

5,200
9,188

5,400
6,626

5,800
7,380

5,800
6,029

[ 34 ]

selected 5-year financial summary

segment summary

D o l l a r s i n m i l l i o n s , e xc e p t p e r s h a r e a m o u n t s

2011

2010

change
2011-2010

2009

change
2010-2009

cOnSOliDateD

net sales
Gross profit

as a percent of sales

sG&a expense

as a percent of sales

operating income

as a percent of sales

net interest expense
effective tax rate
net earnings
Diluted earnings per share

engineereD inFraStructure
prODuctS SegMent