Item 1. Financial Statements

DOVER CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(In thousands, except per share data)

(Unaudited)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Revenue			$	2,018,269					$	1,748,256					$	5,917,846					$	4,903,370
Cost of goods and services			1,263,690						1,089,527						3,669,547						3,080,800
Gross profit			754,579						658,729						2,248,299						1,822,570
Selling, general and administrative expenses			412,553						381,831						1,249,593						1,135,512
Operating earnings			342,026						276,898						998,706						687,058
Interest expense			26,433						27,724						79,917						83,703
Interest income			(1,466)						(960)						(3,088)						(2,871)
Loss (gain) on sale of a business			—						557						—						(5,213)
Other income, net			(10,460)						(1,420)						(18,236)						(9,887)
Earnings before provision for income taxes			327,519						250,997						940,113						621,326
Provision for income taxes			63,763						50,697						179,080						119,981
Net earnings			$	263,756					$	200,300					$	761,033					$	501,345
Net earnings per share:
Basic			$	1.83					$	1.39					$	5.29					$	3.48
Diluted			$	1.81					$	1.38					$	5.24					$	3.45
Weighted average shares outstanding:
Basic			143,976						144,032						143,895						144,082
Diluted			145,440						145,289						145,220						145,313

See Notes to Condensed Consolidated Financial Statements

DOVER CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS

(In thousands)

(Unaudited)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Net earnings			$	263,756					$	200,300					$	761,033					$	501,345
Other comprehensive (loss) earnings, net of tax
Foreign currency translation adjustments:
Foreign currency translation (losses) gains			(26,155)						29,271						(17,567)						(19,714)
Total foreign currency translation adjustments (net of $(5,446), $9,872, $(11,669), $12,761 tax (provision) benefit, respectively)			(26,155)						29,271						(17,567)						(19,714)
Pension and other post-retirement benefit plans:
Amortization of actuarial losses included in net periodic pension cost			2,353						1,881						7,080						5,385
Amortization of prior service costs included in net periodic pension cost			214						250						646						794
Total pension and other post-retirement benefit plans (net of $(771), $(421), $(2,320), $(1,408) tax provision, respectively)			2,567						2,131						7,726						6,179
Changes in fair value of cash flow hedges:
Unrealized net (losses) gains arising during period			(212)						(278)						4,107						(3,472)
Net (gains) losses reclassified into earnings			(206)						(210)						(3,077)						318
Total cash flow hedges (net of $122, $139, $(302), $896 tax benefit (provision), respectively)			(418)						(488)						1,030						(3,154)
Other comprehensive (loss) earnings, net of tax			(24,006)						30,914						(8,811)						(16,689)
Comprehensive earnings			$	239,750					$	231,214					$	752,222					$	484,656

See Notes to Condensed Consolidated Financial Statements

DOVER CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

			September 30, 2021						December 31, 2020
Assets
Current assets:
Cash and cash equivalents			$	739,144					$	513,075
Receivables, net of allowances of $41,598 and $40,474			1,351,144						1,137,223
Inventories, net			1,055,831						835,804
Prepaid and other current assets			153,296						133,085
Total current assets			3,299,415						2,619,187
Property, plant and equipment, net			906,268						897,326
Goodwill			4,153,846						4,072,542
Intangible assets, net			1,036,085						1,083,772
Other assets and deferred charges			507,369						479,247
Total assets			$	9,902,983					$	9,152,074
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable			$	1,047,824					$	853,942
Accrued compensation and employee benefits			270,944						239,750
Deferred revenue			195,509						184,845
Accrued insurance			104,000						98,954
Other accrued expenses			350,222						343,637
Federal and other income taxes			37,382						17,670
Total current liabilities			2,005,881						1,738,798
Long-term debt			3,060,184						3,108,829
Deferred income taxes			321,610						298,423
Noncurrent income tax payable			48,376						49,937
Other liabilities			575,114						570,314
Stockholders' equity:
Total stockholders' equity			3,891,818						3,385,773
Total liabilities and stockholders' equity			$	9,902,983					$	9,152,074

See Notes to Condensed Consolidated Financial Statements

DOVER CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except share data)

(Unaudited)

			Common stock $1 par value						Additional paid-in capital						Retained earnings						Accumulated other comprehensive loss						Treasury stock						Total stockholders' equity
Balance at June 30, 2021			$	259,371					$	853,887					$	8,962,863					$	(138,059)					$	(6,218,758)					$	3,719,304
Net earnings			—						—						263,756						—						—						263,756
Dividends paid ($0.50 per share)			—						—						(72,107)						—						—						(72,107)
Common stock issued for the exercise of share-based awards			25						(1,795)						—						—						—						(1,770)
Stock-based compensation expense			—						6,660						—						—						—						6,660
Other comprehensive loss, net of tax			—						—						—						(24,006)						—						(24,006)
Other, net			—						(19)						—						—						—						(19)
Balance at September 30, 2021			$	259,396					$	858,733					$	9,154,512					$	(162,065)					$	(6,218,758)					$	3,891,818

			Common stock $1 par value						Additional paid-in capital						Retained earnings						Accumulated other comprehensive (loss) earnings						Treasury stock						Total stockholders' equity
Balance at June 30, 2020			$	258,768					$	869,526					$	8,368,620					$	(263,629)					$	(6,143,758)					$	3,089,527
Net earnings			—						—						200,300						—						—						200,300
Dividends paid ($0.495 per share)			—						—						(71,458)						—						—						(71,458)
Common stock issued for the exercise of share-based awards			125						(10,358)						—						—						—						(10,233)
Stock-based compensation expense			—						7,371						—						—						—						7,371
Other comprehensive earnings, net of tax			—						—						—						30,914						—						30,914
Balance at September 30, 2020			$	258,893					$	866,539					$	8,497,462					$	(232,715)					$	(6,143,758)					$	3,246,421

See Notes to Condensed Consolidated Financial Statements

DOVER CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except share data)

(Unaudited)

			Common stock $1 par value						Additional paid-in capital						Retained earnings						Accumulated other comprehensive loss						Treasury stock						Total stockholders' equity
Balance at December 31, 2020			$	258,982					$	868,882					$	8,608,284					$	(153,254)					$	(6,197,121)					$	3,385,773
Net earnings			—						—						761,033						—						—						761,033
Dividends paid ($1.49 per share)			—						—						(214,805)						—						—						(214,805)
Common stock issued for the exercise of share-based awards			414						(35,252)						—						—						—						(34,838)
Stock-based compensation expense			—						25,053						—						—						—						25,053
Common stock acquired			—						—						—						—						(21,637)						(21,637)
Other comprehensive loss, net of tax			—						—						—						(8,811)						—						(8,811)
Other, net			—						50						—						—						—						50
Balance at September 30, 2021			$	259,396					$	858,733					$	9,154,512					$	(162,065)					$	(6,218,758)					$	3,891,818

			Common stock $1 par value						Additional paid-in capital						Retained earnings						Accumulated other comprehensive loss						Treasury stock						Total stockholders' equity
Balance at December 31, 2019			$	258,552					$	869,719					$	8,211,257					$	(216,026)					$	(6,090,842)					$	3,032,660
Adoption of ASU 2016-13			—						—						(2,112)						—						—						(2,112)
Net earnings			—						—						501,345						—						—						501,345
Dividends paid ($1.475 per share)			—						—						(213,028)						—						—						(213,028)
Common stock issued for the exercise of share-based awards			341						(21,791)						—						—						—						(21,450)
Stock-based compensation expense			—						15,591						—						—						—						15,591
Common stock acquired			—						—						—						—						(52,916)						(52,916)
Other comprehensive loss, net of tax			—						—						—						(16,689)						—						(16,689)
Other, net			—						3,020						—						—						—						3,020
Balance at September 30, 2020			$	258,893					$	866,539					$	8,497,462					$	(232,715)					$	(6,143,758)					$	3,246,421

See Notes to Condensed Consolidated Financial Statements

DOVER CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

			Nine Months Ended September 30,
			2021						2020
Operating Activities:
Net earnings			$	761,033					$	501,345
Adjustments to reconcile net earnings to cash from operating activities:
Depreciation and amortization			218,236						205,844
Stock-based compensation expense			25,053						15,591
Gain on sale of a business			—						(5,213)
Other, net			(11,969)						(7,731)
Cash effect of changes in assets and liabilities:
Accounts receivable, net			(222,521)						31,631
Inventories			(225,522)						(19,360)
Prepaid expenses and other assets			(38,290)						(24,198)
Accounts payable			199,877						(104,571)
Accrued compensation and employee benefits			32,284						(13,136)
Accrued expenses and other liabilities			42,084						131,279
Accrued and deferred taxes, net			8,321						(24,562)
Net cash provided by operating activities			788,586						686,919
Investing Activities:
Additions to property, plant and equipment			(121,157)						(123,564)
Acquisitions, net of cash acquired			(171,287)						(258,674)
Proceeds from sale of property, plant and equipment			6,570						5,090
Proceeds from sale of businesses			—						15,400
Other			(768)						(1,250)
Net cash used in investing activities			(286,642)						(362,998)
Financing Activities:
Repurchase of common stock			(21,637)						(52,916)
Change in notes payable			—						5,811
Dividends paid to stockholders			(214,805)						(213,028)
Payments to settle employee tax obligations on exercise of share-based awards			(34,838)						(21,450)
Other			(3,518)						(1,753)
Net cash used in financing activities			(274,798)						(283,336)
Effect of exchange rate changes on cash and cash equivalents			(1,077)						(10,337)
Net increase in cash and cash equivalents			226,069						30,248
Cash and cash equivalents at beginning of period			513,075						397,253
Cash and cash equivalents at end of period			$	739,144					$	427,501

See Notes to Condensed Consolidated Financial Statements

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

1. Basis of Presentation

The accompanying unaudited interim Condensed Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for interim periods and do not include all of the information and note disclosures required by accounting principles generally accepted in the United States of America ("GAAP") for complete financial statements. These unaudited interim Condensed Consolidated Financial Statements should therefore be read in conjunction with the Consolidated Financial Statements and Notes for Dover Corporation ("Dover" or the "Company") for the year ended December 31, 2020, included in the Company's Annual Report on Form 10-K filed with the SEC on February 12, 2021. The year-end Condensed Consolidated Balance Sheet was derived from audited financial statements. Certain amounts in the prior periods have been reclassified to conform to the current year presentation.

The accompanying unaudited interim Condensed Consolidated Financial Statements have been prepared in accordance with U.S. GAAP, which requires management to make estimates and assumptions that affect amounts reported in the Condensed Consolidated Financial Statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future, actual results may differ from those estimates. The Condensed Consolidated Financial Statements reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for a fair statement of results for these interim periods. The results of operations of any interim period are not necessarily indicative of the results of operations for the full year.

2. Revenue

A majority of the Company’s revenue is short cycle in nature with shipments within one year from order. A small portion of the Company’s revenue derives from contracts extending over one year. The Company's payment terms generally range between 30 to 90 days and vary by the location of businesses, the type of products manufactured to be sold and the volume of products sold, among other factors.

Over 95% of the Company’s performance obligations are recognized at a point in time that relate to the manufacture and sale of a broad range of products and components. Revenue is recognized when control transfers to the customer upon shipment or completion of installation, testing, certification, or other substantive acceptance provisions required under the contract. Less than 5% of the Company’s revenue is recognized over time and relates to the sale of equipment or services in which the Company transfers control of a good or service over time and the customer simultaneously receives and consumes the benefits provided by the Company's performance as the Company performs, or our performance creates or enhances an asset the customer controls as the asset is created or enhanced, or our performance does not create an asset with an alternative use to the Company and the Company has an enforceable right to payment for its performance to date plus a reasonable margin.

Revenue from contracts with customers is disaggregated by segment and geographic location, as they best depict the nature and amount of the Company’s revenue. See Note 17 — Segment Information for revenue by segment and geographic location.

At September 30, 2021, we estimated that $260 million in revenue is expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period. We expect to recognize approximately 48% of our unsatisfied (or partially unsatisfied) performance obligations as revenue through 2022, with the remaining balance to be recognized in 2023 and thereafter.

The following table provides information about contract assets and contract liabilities from contracts with customers:

						September 30, 2021						December 31, 2020						December 31, 2019
Contract assets						$	25,454					$	15,020					$	14,894
Contract liabilities - current						195,509						184,845						104,901
Contract liabilities - non-current						24,415						13,921						10,921

In the fourth quarter of 2020, the Company adjusted its prior year balance sheet classification and footnote disclosure related to certain upfront cash consideration received from customers that should have been classified as contract liabilities (included in deferred revenue or other liabilities) rather than customer deposits (included in accounts payable).

The revenue recognized during the nine months ended September 30, 2021 and 2020 that was included in contract liabilities at the beginning of the period, inclusive of adjustments, amounted to $155,255 and $76,766, respectively.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

3. Acquisitions

2021 Acquisitions

During the nine months ended September 30, 2021, the Company acquired six businesses in separate transactions for total consideration of $178,556, net of cash acquired and including contingent consideration. These businesses were acquired to complement and expand upon existing operations within the Engineered Products, Imaging & Identification, Pumps & Process Solutions, and Fueling Solutions segments. The goodwill recorded as a result of these acquisitions represents the economic benefits expected to be derived from product line expansions and operational synergies. Goodwill of $29,808 is deductible for income tax purposes and $81,561 is non-deductible for income tax purposes for these acquisitions.

On September 15, 2021, the Company acquired 100% of the voting stock of The Espy Corporation ("Espy"), a manufacturer of advanced electronic radio frequency sensor systems, for $60,611, net of cash acquired. The Espy acquisition strengthens the Company's offering of complete signal intelligence systems with integrated software within the Engineered Products segment. In connection with this acquisition, the Company recorded goodwill of $29,808 and intangible assets of $20,200, primarily related to customer intangibles. The Espy acquisition will be treated as an asset acquisition for U.S. income tax purposes, classifying the goodwill and intangibles as tax deductible.

On July 23, 2021, the Company acquired 100% of the voting stock of CDS Visual, Inc. ("CDS Visual"), a leading provider of 3D visualization solutions tailored for industrial applications, for $29,347, net of cash acquired. The CDS Visual acquisition extends the Company's reach of customer-facing digital capabilities within the Engineered Products segment. In connection with this acquisition, the Company recorded goodwill of $20,337 and intangible assets of $9,930, primarily related to technology.

On June 24, 2021, the Company acquired 100% of the voting stock of Blue Bite LLC ("Blue Bite"), a leading provider of consumer engagement and brand protection software solutions, for $29,035, net of cash acquired and including contingent consideration. The Blue Bite acquisition strengthens the Company's offering of product traceability and authentication solutions within the Imaging & Identification segment. In connection with this acquisition, the Company recorded goodwill of $19,378 and intangible assets of $13,250, primarily related to technology.

On June 23, 2021, the Company acquired 100% of the voting stock of Quantex Arc Limited ("Quantex"), a leading provider of single-use, recyclable pumps, for $23,896, net of cash acquired and including contingent consideration. The Quantex acquisition enhances the offering of single-use pumps for biopharma and other hygienic applications within the Pumps & Process Solutions segment. In connection with this acquisition, the Company recorded goodwill of $14,476 and intangible assets of $11,034, primarily related to patented technology.

On April 19, 2021, the Company acquired 100% of the voting stock of AvaLAN Wireless Systems, Incorporated ("AvaLAN"), a leading provider of secure wireless communications solutions for the convenience and fuel retail industry, for $34,144, net of cash acquired. The AvaLAN acquisition extends the Company's reach into the systems and software offering within the Fueling Solutions segment. In connection with this acquisition, the Company recorded goodwill of $26,679 and intangible assets of $14,630, primarily related to customer intangibles.

One other immaterial acquisition was completed during the nine months ended September 30, 2021 within the Pumps & Process Solutions segment.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

The following presents the preliminary allocation of purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at their acquisition dates:

						Total
Current assets, net of cash acquired						$	12,343
Property, plant and equipment						8,088
Goodwill						111,369
Intangible assets						69,044
Other assets and deferred charges						4,104
Current liabilities						(12,097)
Other liabilities						(14,295)
Net assets acquired						$	178,556

The amounts assigned to goodwill and major intangible asset classifications were as follows:

			Amount allocated						Useful life (in years)
Goodwill - tax deductible			$	29,808					na
Goodwill - non-deductible			81,561						na
Customer intangibles			33,692						12			-			15
Unpatented technologies			22,680						7			-			12
Patents			6,006						9
Trademarks			6,666						15
			$	180,413

2020 Acquisitions

During the nine months ended September 30, 2020, the Company acquired five businesses in separate transactions for total consideration of $258,674, net of cash acquired. These businesses were acquired to complement and expand upon existing operations within the Imaging & Identification, Engineered Products and Pumps & Process Solutions segments. The goodwill recorded as a result of these acquisitions represents the economic benefits expected to be derived from product line expansions and operational synergies. Goodwill in the amount of $33,183 is deductible for U.S. income tax purposes and goodwill in the amount of $124,691 is non-deductible for U.S. income tax purposes for these acquisitions.

On August 20, 2020, the Company acquired 100% of the voting stock of Solaris Laser S.A. ("Solaris"), a global manufacturer of product identification and traceability solutions for $18,605, net of cash acquired. The Solaris acquisition enhances the Imaging & Identification segment's growing laser technology product line and further strengthens its position as a leading provider of marking and coding equipment and solutions. In connection with this acquisition, the Company recorded goodwill of $11,693 and intangible assets of $3,280, primarily related to unpatented technology.

On April 30, 2020, the Company acquired 100% of the voting stock of em-tec GmbH ("Em-tec"), a leading designer and manufacturer of flow measurement devices that serve a wide array of medical and biopharmaceutical applications for $30,396, net of cash acquired. The Em-tec acquisition further expands the Company's reach into biopharma and other hygienic applications and enhances its portfolio of flow control technologies within the Pumps & Process Solutions segment. In connection with this acquisition, the Company recorded goodwill of $19,572 and intangible assets of $8,344, primarily related to customer intangibles.

On February 18, 2020, the Company acquired 100% of the voting stock of So. Cal. Soft-Pak, Incorporated ("Soft-Pak"), a leading specialized provider of integrated back office, route management and customer relationship management software solutions to the waste and recycling fleet industry for $45,500, net of cash acquired. The Soft-Pak acquisition strengthens the digital offerings within the Engineered Products segment. In connection with this acquisition, the Company recorded goodwill of $33,183 and intangible assets of $12,800, primarily related to customer intangibles.

On January 24, 2020, the Company acquired 100% of the voting stock of Sys-Tech Solutions, Inc. ("Systech"), a leading provider of product traceability, regulatory compliance and brand-protection software and solutions to pharmaceutical and consumer products manufacturers, for $161,830, net of cash acquired. The Systech acquisition strengthens the portfolio of solutions offered by the Imaging & Identification segment. In connection with this acquisition, the Company recorded goodwill

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

of $91,493 and intangible assets of $76,100, primarily related to customer intangibles.

One other immaterial acquisition was completed during the nine months ended September 30, 2020, within the Pumps & Process Solutions segment.

The pro forma effects of the 2021 and 2020 acquisitions are not material to the Company's Consolidated Statements of Earnings.

4. Disposed Operations

Management evaluates Dover's businesses periodically for their strategic fit within its operations and may from time to time sell or discontinue certain operations for various reasons.

2021

There were no dispositions for the nine months ended September 30, 2021.

See Note 21 — Subsequent Events for information on a definitive agreement to sell Unified Brands business ("Unified Brands") which is part of the Refrigeration & Food Equipment segment.

2020

On March 6, 2020, the Company completed the sale of the Chino, California branch of The AMS Group ("AMS Chino"), a wholly owned subsidiary of the Company. The Company recognized a net consideration of $15,400, which included a working capital adjustment recognized in the second quarter and paid in the third quarter of 2020. This sale resulted in a pre-tax gain on sale of $5,213 included within the Condensed Consolidated Statements of Earnings and within the Refrigeration & Food Equipment Segment for the nine months ended September 30, 2020. The sale did not represent a strategic shift that had a major effect on operations and financial results and, therefore, did not qualify for presentation as a discontinued operation.

5. Inventories, net

			September 30, 2021						December 31, 2020
Raw materials			$	624,365					$	497,604
Work in progress			232,264						152,360
Finished goods			333,021						304,760
Subtotal			1,189,650						954,724
Less reserves			(133,819)						(118,920)
Total			$	1,055,831					$	835,804

6. Property, Plant and Equipment, net

			September 30, 2021						December 31, 2020
Land			$	61,433					$	60,287
Buildings and improvements			576,597						570,366
Machinery, equipment and other			1,817,417						1,772,772
Property, plant and equipment, gross			2,455,447						2,403,425
Accumulated depreciation			(1,549,179)						(1,506,099)
Property, plant and equipment, net			$	906,268					$	897,326

Depreciation expense totaled $36,913 and $34,096 for the three months ended September 30, 2021 and 2020, respectively. For the nine months ended September 30, 2021 and 2020, depreciation expense was $111,152 and $102,016, respectively.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

7. Credit Losses

Effective January 1, 2020, the Company adopted ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments prospectively. This ASU replaces the incurred loss impairment model with an expected credit loss impairment model for financial instruments, including trade receivables. The amendment requires entities to consider forward-looking information to estimate expected credit losses, resulting in earlier recognition of losses for receivables that are current or not yet due, which were not considered under the previous accounting guidance. Upon adoption, the Company recorded a noncash cumulative effect adjustment to retained earnings of $2.1 million, net of $0.6 million of income taxes, on the opening consolidated balance sheet as of January 1, 2020.

The Company is exposed to credit losses primarily through sales of products and services. Due to the short-term nature of such receivables, the estimate of amount of accounts receivable that may not be collected is based on aging of the accounts receivable balances and other historical and forward-looking information on the financial condition of customers. Balances are written off when determined to be uncollectible.

The following table provides a roll-forward of the allowance for credit losses that is deducted from the amortized cost basis of accounts receivable to present the net amount expected to be collected.

			2021						2020
Beginning Balance, December 31 of the Prior Year			$	40,474					$	29,381
Adoption of ASU 2016-13, cumulative-effect adjustment to retained earnings			—						2,706
Provision for expected credit losses, net of recoveries			4,744						10,248
Amounts written off charged against the allowance			(3,991)						(2,113)
Other, including dispositions and foreign currency translation			371						171
Ending balance, September 30			$	41,598					$	40,393

8. Goodwill and Other Intangible Assets

The changes in the carrying value of goodwill by reportable operating segments were as follows:

			Engineered Products						Fueling Solutions						Imaging & Identification						Pumps & Process Solutions						Refrigeration & Food Equipment						Total
Balance at December 31, 2020			$	682,985					$	940,973					$	1,117,589					$	786,280					$	544,715					$	4,072,542
Acquisitions			50,145						26,679						19,378						15,167						—						111,369
Purchase price adjustments			—						1,314						(1,926)						—						—						(612)
Foreign currency translation			(5,037)						(2,945)						(16,561)						(4,230)						(680)						(29,453)
Balance at September 30, 2021			$	728,093					$	966,021					$	1,118,480					$	797,217					$	544,035					$	4,153,846

During the nine months ended September 30, 2021, the Company recognized additions of $111,369 to goodwill as a result of acquisitions as discussed in Note 3 — Acquisitions. During the nine months ended September 30, 2021, the Company recorded purchase price adjustments that reduced goodwill by $612, principally related to working capital adjustments for 2020 acquisitions within the Fueling Solutions and Imaging & Identification segments.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

The Company’s definite-lived and indefinite-lived intangible assets by major asset class were as follows:

			September 30, 2021																		December 31, 2020
			Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount						Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount
Amortized intangible assets:
Customer intangibles			$	1,577,058					$	900,659					$	676,399					$	1,559,771					$	834,798					$	724,973
Trademarks			238,121						115,076						123,045						233,205						103,907						129,298
Patents			167,966						143,855						24,111						163,299						141,182						22,117
Unpatented technologies			201,573						121,243						80,330						180,947						113,404						67,543
Distributor relationships			85,861						54,847						31,014						87,028						51,611						35,417
Drawings and manuals			28,233						27,136						1,097						29,198						26,193						3,005
Other			23,486						20,177						3,309						23,901						19,324						4,577
Total			2,322,298						1,382,993						939,305						2,277,349						1,290,419						986,930
Unamortized intangible assets:
Trademarks			96,780						—						96,780						96,842						—						96,842
Total intangible assets, net			$	2,419,078					$	1,382,993					$	1,036,085					$	2,374,191					$	1,290,419					$	1,083,772

For the three months ended September 30, 2021 and 2020, amortization expense was $35,998 and $35,393, respectively, including acquisition-related intangible amortization of $35,587 and $34,797, respectively. For the nine months ended September 30, 2021 and 2020, amortization expense was $107,084 and $103,828, respectively, including acquisition-related intangible amortization of $105,808 and $102,443, respectively.

9. Restructuring Activities

The Company's restructuring charges by segment were as follows:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Engineered Products			$	870					$	2,342					$	9,200					$	6,860
Fueling Solutions			1,620						1,572						3,084						3,958
Imaging & Identification			168						99						1,032						(167)
Pumps & Process Solutions			639						1,719						1,526						10,271
Refrigeration & Food Equipment			1,293						534						4,637						3,307
Corporate			200						474						1,182						2,136
Total			$	4,790					$	6,740					$	20,661					$	26,365
These amounts are classified in the Condensed Consolidated Statements of Earnings as follows:
Cost of goods and services			$	2,194					$	2,710					$	10,940					$	11,809
Selling, general and administrative expenses			2,596						4,030						9,721						14,556
Total			$	4,790					$	6,740					$	20,661					$	26,365

The restructuring expenses of $4,790 and $20,661 incurred during the three and nine months ended September 30, 2021 were primarily the result of restructuring programs initiated in 2020 and 2021 in response to demand conditions, asset charges related to a product line exit and broad-based operational efficiency initiatives focusing on footprint consolidation and IT centralization. Additional programs, beyond the scope of the announced programs, may be implemented during 2021 with related restructuring charges.

The $4,790 of restructuring charges incurred during the third quarter of 2021 primarily included the following items:

• The Engineered Products segment recorded $870 of restructuring charges related principally to asset charges related to a product line exit.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

• The Fueling Solutions segment recorded $1,620 of restructuring charges primarily due to asset charges, headcount reductions and facility exit costs.

• The Imaging & Identification segment recorded restructuring charges of $168 primarily related to headcount reductions.

• The Pumps & Process Solutions segment recorded $639 of restructuring charges primarily related to asset charges.

• The Refrigeration & Food Equipment segment recorded $1,293 of restructuring expense primarily due to asset charges.

• Corporate recorded $200 of restructuring charges primarily related to exit costs associated with IT centralization initiatives.

The Company’s severance and exit accrual activities were as follows:

			Severance						Exit						Total
Balance at December 31, 2020			$	10,547					$	4,366					$	14,913
Restructuring charges			7,933						12,728						20,661
Payments			(9,625)						(4,500)						(14,125)
Other, including foreign currency translation			(190)						(9,342)			(1)			(9,532)
Balance at September 30, 2021			$	8,665					$	3,252					$	11,917

(1) Other activity in exit reserves primarily represents asset charges related to a product line exit.

10. Borrowings

Borrowings consisted of the following:

									Carrying amount (1)
			Principal						September 30, 2021						December 31, 2020
Long-term
3.15% 10-year notes due November 15, 2025			$	400,000					$	397,221					$	396,716
1.25% 10-year notes due November 9, 2026 (euro-denominated)			€	600,000					697,073						724,310
0.750% 8-year notes due November 4, 2027 (euro denominated)			€	500,000					580,355						603,107
6.65% 30-year debentures due June 1, 2028			$	200,000					199,331						199,255
2.950% 10-year notes due November 4, 2029			$	300,000					296,934						296,650
5.375% 30-year debentures due October 15, 2035			$	300,000					296,497						296,309
6.60% 30-year notes due March 15, 2038			$	250,000					248,137						248,053
5.375% 30-year notes due March 1, 2041			$	350,000					344,636						344,429
Total long-term debt									$	3,060,184					$	3,108,829

(1) Carrying amount is net of unamortized debt discount and deferred debt issuance costs. Total unamortized debt discounts were

$15.8 million and $17.6 million as of September 30, 2021 and December 31, 2020, respectively. Total deferred debt issuance costs were $13.0 million and $14.4 million as of September 30, 2021 and December 31, 2020, respectively.

As of September 30, 2021, the Company maintained a $1.0 billion five-year unsecured revolving credit facility (the "Credit Agreement") with a syndicate of banks which expires on October 4, 2024. At the Company's election, loans under the Credit Agreement will bear interest at a base rate plus an applicable margin. The Credit Agreement requires the Company to pay a facility fee and imposes various restrictions on the Company such as, among other things, a requirement to maintain a minimum interest coverage ratio of EBITDA to consolidated net interest expense of not less than 3.0 to 1. The Company uses the Credit Agreement principally as liquidity back-up for its commercial paper program and for general corporate purposes.

The Company was in compliance with all covenants in the Credit Agreement and other long-term debt covenants at September 30, 2021 and had an interest coverage ratio of consolidated EBITDA to consolidated net interest expense of 14.9 to 1.

As of September 30, 2021, the Company had approximately $154.8 million outstanding in letters of credit, surety bonds, and performance and other guarantees which expire on various dates through 2029. These letters of credit and bonds are primarily issued as security for insurance, warranty and other performance obligations. In general, we would only be liable for the amount of these guarantees in the event of default in the performance of our obligations.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

11. Financial Instruments

Derivatives

The Company is exposed to market risk for changes in foreign currency exchange rates due to the global nature of its operations and certain commodity risks. In order to manage these risks, the Company has hedged portions of its forecasted sales and purchases to occur within the next twelve months that are denominated in non-functional currencies, with currency forward contracts designated as cash flow hedges. At September 30, 2021 and December 31, 2020, the Company had contracts with total notional amounts of $178,702 and $173,674, respectively, to exchange currencies, principally Euro, Pound Sterling, Swedish Krona, Chinese Yuan, Canadian Dollar, and Swiss Franc. The Company believes it is probable that all forecasted cash flow transactions will occur.

In addition, the Company had outstanding contracts with a total notional amount of $90,088 and $73,755 as of September 30, 2021 and December 31, 2020, respectively, that are not designated as hedging instruments. These instruments are used to reduce the Company's exposure for operating receivables and payables that are denominated in non-functional currencies. Gains and losses on these contracts are recorded in other income, net in the Condensed Consolidated Statements of Earnings.

The following table sets forth the fair values of derivative instruments held by the Company as of September 30, 2021 and December 31, 2020 and the balance sheet lines in which they are recorded:

			Fair Value Asset (Liability)
			September 30, 2021						December 31, 2020						Balance Sheet Caption
Foreign currency forward			$	1,701					$	2,325					Prepaid and other current assets
Foreign currency forward			(166)						(2,057)						Other accrued expenses

For a cash flow hedge, the change in estimated fair value of a hedging instrument is recorded in accumulated other comprehensive (loss) earnings as a separate component of the Condensed Consolidated Statements of Stockholders' Equity and is reclassified into revenues and cost of goods and services in the Condensed Consolidated Statements of Earnings during the period in which the hedged transaction is settled. The amount of gains or losses from hedging activity recorded in earnings is not significant, and the amount of unrealized gains and losses from cash flow hedges that are expected to be reclassified to earnings in the next twelve months is not significant; therefore, additional tabular disclosures are not presented. There are no amounts excluded from the assessment of hedge effectiveness and the Company's derivative instruments that are subject to credit risk contingent features were not significant.

The Company is exposed to credit loss in the event of nonperformance by counterparties to the financial instrument contracts held by the Company; however, nonperformance by these counterparties is considered unlikely as the Company’s policy is to contract with highly-rated, diversified counterparties.

The Company has designated the €600,000 and €500,000 of euro-denominated notes issued November 9, 2016 and November 4, 2019, respectively, as hedges of a portion of its net investment in euro-denominated operations. Changes in the value of the euro-denominated debt are recognized in foreign currency translation adjustments within other comprehensive earnings of the Condensed Consolidated Statements of Comprehensive Earnings to offset changes in the value of the net investment in euro-denominated operations.

Amounts recognized in other comprehensive earnings for the gains (losses) on net investment hedges were as follows:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Gain (loss) on euro-denominated debt			$	24,032					$	(45,379)					$	51,571					$	(58,659)
Tax (expense) benefit			(5,446)						9,872						(11,669)						12,761
Net gain (loss) on net investment hedges, net of tax			$	18,586					$	(35,507)					$	39,902					$	(45,898)

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

Fair Value Measurements

ASC 820, Fair Value Measurements and Disclosures, establishes a fair value hierarchy that requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the hierarchy is based on the lowest level of input that is significant to the fair value measurement. ASC 820 establishes three levels of inputs that may be used to measure fair value.

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 inputs include inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of assets or liabilities.

Level 3 inputs are unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The following table presents the Company’s assets and liabilities measured at fair value on a recurring basis as of September 30, 2021 and December 31, 2020:

									September 30, 2021												December 31, 2020
									Level 2																		Level 2
Assets:
Foreign currency cash flow hedges									$	1,701																	$	2,325
Liabilities:
Foreign currency cash flow hedges									166																		2,057

In addition to fair value disclosure requirements related to financial instruments carried at fair value, accounting standards require interim disclosures regarding the fair value of all of the Company’s financial instruments.

The estimated fair value of long-term debt at September 30, 2021 and December 31, 2020, was $3,520,716 and $3,635,673, respectively. The estimated fair value of long-term debt is based on quoted market prices for similar instruments and is, therefore, classified as Level 2 within the fair value hierarchy.

The carrying values of cash and cash equivalents, trade receivables, accounts payable and notes payable are reasonable estimates of their fair values as of September 30, 2021 and December 31, 2020 due to the short-term nature of these instruments.

12. Income Taxes

The effective tax rates for the three months ended September 30, 2021 and 2020 were 19.5% and 20.2%, respectively. The decrease in the effective tax rate for the three months ended September 30, 2021 relative to the prior comparable period was primarily driven by favorable audit settlements.

The effective tax rates for the nine months ended September 30, 2021 and 2020 were 19.0% and 19.3%, respectively. The decrease in the effective tax rate for the nine months ended September 30, 2021 relative to the prior year comparable period was primarily driven by favorable audit settlements.

Dover and its subsidiaries file tax returns in the U.S., including various state and local returns, and in other foreign jurisdictions. We believe adequate provision has been made for all income tax uncertainties. The Company is routinely audited by taxing authorities in its filing jurisdictions, and a number of these audits are currently underway. The Company believes that within the next twelve months uncertain tax positions may be resolved and statutes of limitations will expire, which could result in a decrease in the gross amount of unrecognized tax benefits of approximately zero to $9.7 million.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

13. Equity Incentive Program

The Company typically grants equity awards annually at its regularly scheduled first quarter meeting of the Compensation Committee of the Board of Directors. During the nine months ended September 30, 2021, the Company issued stock-settled appreciation rights ("SARs") covering 413,173 shares, performance share awards of 50,371 and restricted stock units ("RSUs") of 83,993.

The Company uses the Black-Scholes option pricing model to determine the fair value of each SAR on the date of grant. Expected volatilities are based on Dover's stock price history, including implied volatilities from traded options on Dover stock. The Company uses historical data to estimate SAR exercise and employee termination patterns within the valuation model. The expected life of SARs granted is derived from the output of the option valuation model and represents the average period of time that SARs granted are expected to be outstanding. The interest rate for periods within the contractual life of the SARs is based on the U.S. Treasury yield curve in effect at the time of grant.

The assumptions used in determining the fair value of the SARs awarded during the respective periods were as follows:

			SARs
			2021						2020
Risk-free interest rate			0.59		%				1.44		%
Dividend yield			1.62		%				1.65		%
Expected life (years)			5.5						5.5
Volatility			30.49		%				22.76		%
Grant price			$122.73						$119.86
Fair value per share at date of grant			$29.08						$22.54

The performance share awards granted in 2021 and 2020 are market condition awards as attainment is based on Dover's performance relative to its peer group (companies listed under the S&P 500 Industrials sector) for the relevant performance period. The performance period and vesting period for these awards is three years. These awards were valued on the date of grant using the Monte Carlo simulation model (a binomial lattice-based valuation model) and are generally recognized ratably over the vesting period, and the fair value is not subject to change based on future market conditions. The assumptions used in determining the fair value of the performance shares granted in the respective periods were as follows:

			Performance Shares
			2021						2020
Risk-free interest rate			0.19		%				1.40		%
Dividend yield			1.62		%				1.65		%
Expected life (years)			2.9						2.9
Volatility			31.90		%				23.30		%
Grant price			$122.73						$119.86
Fair value per share at date of grant			$148.29						$165.71

The Company also has granted RSUs, and the fair value of these awards was determined using Dover's closing stock price on the date of grant.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

Stock-based compensation is reported within selling, general and administrative expenses in the Condensed Consolidated Statements of Earnings. The following table summarizes the Company’s compensation expense relating to all stock-based incentive plans:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Pre-tax stock-based compensation expense			$	6,660					$	7,371					$	25,053					$	15,591
Tax benefit			(576)						(854)						(2,357)						(1,822)
Total stock-based compensation expense, net of tax			$	6,084					$	6,517					$	22,696					$	13,769

The increase in stock-based compensation expense for the nine months ended September 30, 2021 compared to the prior comparable period was primarily due to plan amendments made in the current year, which accelerated the vesting of shares awarded to retirement-eligible employees, as well as lower performance share attainment rates in the prior year.

14. Commitments and Contingent Liabilities

Litigation

Certain of the Company’s subsidiaries are involved in legal proceedings relating to the cleanup of waste disposal sites identified under federal and state statutes that provide for the allocation of such costs among "potentially responsible parties." In each instance, the extent of the Company’s liability appears to be very small in relation to the total projected expenditures and the number of other "potentially responsible parties" involved and is anticipated to be immaterial to the Company. In addition, certain of the Company’s subsidiaries are involved in ongoing remedial activities at certain current and former plant sites, in cooperation with regulatory agencies, and appropriate estimated liabilities have been established. At September 30, 2021 and December 31, 2020, the Company had estimated liabilities totaling $29,887 and $30,431, respectively, for environmental and other matters, including private party claims for exposure to hazardous substances that are probable and estimable.

The Company and certain of its subsidiaries are also parties to a number of other legal proceedings incidental to their businesses. These proceedings primarily involve claims by private parties alleging injury arising out of use of the Company’s products, patent infringement, employment matters, and commercial disputes. Management and legal counsel, at least quarterly, review the probable outcome of such proceedings, the costs and expenses reasonably expected to be incurred and currently accrued to-date, and the availability and extent of insurance coverage. The Company has estimated liabilities for legal matters that are probable and estimable, and at September 30, 2021 and December 31, 2020, these estimated liabilities were not significant. While it is not possible at this time to predict the outcome of these legal actions, in the opinion of management, based on the aforementioned reviews, the Company is not currently involved in any legal proceedings which, individually or in the aggregate, could have a material effect on its financial position, results of operations, or cash flows.

Warranty Accruals

Estimated warranty program claims are provided for at the time of sale of the Company's products. Amounts provided for are based on historical costs and adjusted for new claims and are included within other accrued expenses and other liabilities in the Condensed Consolidated Balance Sheet. The changes in the carrying amount of product warranties through September 30, 2021 and 2020, were as follows:

			2021						2020
Beginning Balance, December 31 of the Prior Year			$	51,088					$	49,116
Provision for warranties			53,747						42,647
Settlements made			(50,350)						(44,396)
Other adjustments, including acquisitions and currency translation			(1,301)						129
Ending balance, September 30			$	53,184					$	47,496

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

15. Employee Benefit Plans

Retirement Plans

The Company sponsors qualified defined benefit pension plans covering certain employees of the Company and its subsidiaries, although the U.S. qualified and non-qualified defined benefit plans are closed to new entrants. The plans’ benefits are generally based on years of service and employee compensation. The Company also provides to certain management employees, through non-qualified plans, supplemental retirement benefits in excess of qualified plan limits imposed by federal tax law.

The tables below set forth the components of the Company’s net periodic expense (income) relating to retirement benefit plans. The service cost component is recognized within selling, general and administrative expenses and cost of goods and services, depending on the functional area of the underlying employees included in the plans, and the non-operating components of pension costs are included within other income, net in the Condensed Consolidated Statements of Earnings.

Qualified Defined Benefits

			Three Months Ended September 30,																								Nine Months Ended September 30,
			U.S. Plan												Non-U.S. Plans												U.S. Plan												Non-U.S. Plans
			2021						2020						2021						2020						2021						2020						2021						2020
Service cost			$	1,784					$	1,706					$	1,398					$	1,366					$	5,351					$	5,118					$	4,238					$	3,954
Interest cost			3,401						4,068						674						839						10,204						12,204						2,036						2,460
Expected return on plan assets			(7,245)						(7,869)						(1,793)						(1,719)						(21,735)						(23,607)						(5,412)						(5,033)
Amortization:
Prior service cost (credit)			53						57						(163)						(126)						159						170						(494)						(365)
Recognized actuarial loss			2,503						1,884						979						777						7,509						5,652						2,968						2,253
Net periodic expense (income)			$	496					$	(154)					$	1,095					$	1,137					$	1,488					$	(463)					$	3,336					$	3,269

Non-Qualified Supplemental Benefits

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Service cost			$	390					$	318					$	1,171					$	954
Interest cost			308						441						924						1,324
Amortization:
Prior service cost			383						424						1,148						1,271
Recognized actuarial gain			(418)						(464)						(1,254)						(1,393)
Net periodic expense			$	663					$	719					$	1,989					$	2,156

Defined Contribution Retirement Plans

The Company also offers defined contribution retirement plans which cover the majority of its U.S. employees, as well as employees in certain other countries. The related expense is recognized within selling, general and administrative expenses and cost of goods and services, depending on the functional area of the underlying employees included in the plans. The Company’s expense relating to defined contribution plans was $15,001 and $12,530 for the three months ended September 30, 2021 and 2020, respectively, and $46,114 and $39,071 for the nine months ended September 30, 2021 and 2020, respectively.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

16. Other Comprehensive Earnings

Amounts reclassified from accumulated other comprehensive loss to earnings during the three and nine months ended September 30, 2021 and 2020 were as follows:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Pension plans:
Amortization of actuarial losses			$	3,064					$	2,194					$	9,223					$	6,501
Amortization of prior service costs			274						358						823						1,086
Total before tax			3,338						2,552						10,046						7,587
Tax benefit			(771)						(421)						(2,320)						(1,408)
Net of tax			$	2,567					$	2,131					$	7,726					$	6,179
Cash flow hedges:
Net (gains) losses reclassified into earnings			$	(267)					$	(266)					$	(3,977)					$	402
Tax provision (benefit)			61						56						900						(84)
Net of tax			$	(206)					$	(210)					$	(3,077)					$	318

The Company recognizes the amortization of net actuarial gains and losses and prior service costs in other income, net within the Condensed Consolidated Statements of Earnings.

Cash flow hedges consist mainly of foreign currency forward contracts. The Company recognizes the realized gains and losses on its cash flow hedges in the same line item as the hedged transaction, such as revenue, cost of goods and services, or selling, general and administrative expenses.

17. Segment Information

The Company categorizes its operating companies into five reportable segments as follows:

• Engineered Products segment is a provider of a wide range of products, software and services that have broad customer applications across a number of markets, including aftermarket vehicle service, solid waste handling, industrial automation, aerospace and defense, industrial winch and hoist, and fluid dispensing.

• Fueling Solutions segment is focused on providing components, equipment and software and service solutions enabling safe transport of fuels and other hazardous fluids along the supply chain, as well as the safe and efficient operation of retail fueling and vehicle wash establishments.

• Imaging & Identification segment supplies precision marking and coding, product traceability and digital textile printing equipment, as well as related consumables, software and services.

• Pumps & Process Solutions segment manufactures specialty industrial pumps, fluid handling components, plastics and polymer processing equipment, single use pumps, flow meters and connectors for biopharma and other hygienic applications, and highly engineered components for rotating and reciprocating machines.

• Refrigeration & Food Equipment segment is a provider of innovative and energy-efficient equipment and systems that serve the commercial refrigeration, heating and cooling and food equipment markets.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

Segment financial information and a reconciliation of segment results to consolidated results was as follows:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Revenue:
Engineered Products			$	447,798					$	386,562					$	1,318,016					$	1,137,102
Fueling Solutions			410,561						380,511						1,237,281						1,066,988
Imaging & Identification			292,535						265,690						870,939						750,432
Pumps & Process Solutions			438,240						347,875						1,261,318						976,506
Refrigeration & Food Equipment			429,425						368,395						1,232,008						973,835
Intra-segment eliminations			(290)						(777)						(1,716)						(1,493)
Total consolidated revenue			$	2,018,269					$	1,748,256					$	5,917,846					$	4,903,370
Net earnings:
Segment earnings (EBIT): (1)
Engineered Products (2)			$	71,717					$	64,890					$	203,216					$	181,686
Fueling Solutions			65,593						66,601						210,828						167,313
Imaging & Identification			63,419						51,928						181,158						141,456
Pumps & Process Solutions			142,414						89,786						404,691						223,567
Refrigeration & Food Equipment(3)			42,841						40,159						129,929						75,147
Total segment earnings (EBIT)			385,984						313,364						1,129,822						789,169
Corporate expense / other (4)			33,498						35,603						112,880						87,011
Interest expense			26,433						27,724						79,917						83,703
Interest income			(1,466)						(960)						(3,088)						(2,871)
Earnings before provision for income taxes			327,519						250,997						940,113						621,326
Provision for income taxes			63,763						50,697						179,080						119,981
Net earnings			$	263,756					$	200,300					$	761,033					$	501,345

(1) Segment earnings (EBIT) includes non-operating income and expense directly attributable to the segments. Non-operating income and expense includes gain on sale of a business and other income, net.

(2) Q3 2021 includes a $9,078 payment received for previously incurred restructuring costs related to a product line exit.

(3) The three and nine months ended September 30, 2020 include a $557 expense and a $5,213 gain on the sale of AMS Chino, respectively. The nine months ended September 30, 2020 also include a $3,640 write-off of assets.

(4) Certain expenses are maintained at the corporate level and not allocated to the segments. These expenses include executive and functional compensation costs, non-service pension costs, non-operating insurance expenses, shared business services overhead costs, deal related expenses and various administrative expenses relating to the corporate headquarters.

The following table presents revenue disaggregated by geography based on the location of the Company's customer:

			Three Months Ended September 30,												Nine Months Ended September 30,
Revenue by geography			2021						2020						2021						2020
United States			$	1,108,513					$	952,548					$	3,235,542					$	2,762,187
Europe			452,066						383,867						1,356,435						1,065,109
Asia			222,366						207,474						650,481						525,758
Other Americas			166,230						138,060						468,298						380,104
Other			69,094						66,307						207,090						170,212
Total			$	2,018,269					$	1,748,256					$	5,917,846					$	4,903,370

18. Share Repurchases

In November 2020, the Company's Board of Directors approved a new standing share repurchase authorization, whereby the Company may repurchase up to 20 million shares beginning on January 1, 2021 through December 31, 2023. This share repurchase authorization replaced the February 2018 share repurchase authorization.

In the nine months ended September 30, 2021, the Company repurchased 182,951 shares of common stock at a total cost of $21,637, or $118.27 per share. There were no repurchases during the three months ended September 30, 2021. In the nine

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

months ended September 30, 2020, the Company repurchased 548,659 shares of common stock at a total cost of $52,916, or $96.45 per share. There were no repurchases during the three months ended September 30, 2020.

As of September 30, 2021, 19,817,049 shares remain authorized for repurchase under the November 2020 share repurchase authorization.

19. Earnings per Share

The following table sets forth a reconciliation of the information used in computing basic and diluted earnings per share:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Net earnings			$	263,756					$	200,300					$	761,033					$	501,345
Basic earnings per common share:
Net earnings			$	1.83					$	1.39					$	5.29					$	3.48
Weighted average shares outstanding			143,976,000						144,032,000						143,895,000						144,082,000
Diluted earnings per common share:
Net earnings			$	1.81					$	1.38					$	5.24					$	3.45
Weighted average shares outstanding			145,440,000						145,289,000						145,220,000						145,313,000

The following table is a reconciliation of the share amounts used in computing earnings per share:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Weighted average shares outstanding - Basic			143,976,000						144,032,000						143,895,000						144,082,000
Dilutive effect of assumed exercise of SARs and vesting of performance shares and RSUs			1,464,000						1,257,000						1,325,000						1,231,000
Weighted average shares outstanding - Diluted			145,440,000						145,289,000						145,220,000						145,313,000

Diluted earnings per share amounts are computed using the weighted average number of common shares outstanding and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of SARs and vesting of performance shares and RSUs, as determined using the treasury stock method.

The weighted average number of anti-dilutive potential common shares excluded from the calculation above were approximately 1,000 and 36,000 for the three months ended September 30, 2021 and 2020, respectively, and 57,000 and 95,000 for the nine months ended September 30, 2021 and 2020, respectively.

20. Recent Accounting Pronouncements

Recently Adopted Accounting Standards

In March 2020 and January 2021, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU 2021-01, Reference Rate Reform, Scope, respectively. These updates provide optional guidance for a limited time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform, including expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in these updates are elective and are effective upon issuance for all entities. The Company adopted the guidance during the third quarter of 2021. The adoption did not have a material impact the Company's Consolidated Financial Statements.

DOVER CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands except share data and where otherwise indicated) (Unaudited)

21. Subsequent Events

On October 11, 2021, the Company entered into a definitive agreement to sell its Unified Brands business, which is part of the Refrigeration & Food Equipment segment, to Electrolux Professional AB for approximately $244 million, on a cash free and debt free basis, subject to customary post-closing adjustments. Unified Brands did not meet the criteria for assets held for sale as of September 30, 2021 and, therefore, is presented as a component of continuing operations. Further, the sale of Unified Brands does not represent a strategic shift that will have a major effect on Dover's operations or financial results. Therefore, it will not qualify for presentation as a discontinued operation.

On October 15, 2021, the Company completed the acquisition of LIQAL B.V ("LIQAL"), a turn-key supplier of liquified natural gas and hydrogen refueling equipment and solutions and micro-liquefaction solutions, for approximately €20 million, plus potential contingent consideration. LIQAL will be included in the Fueling Solutions segment.