Nordson Corporation 11-K
Table of Contents

 
 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 11-K

         
(Mark one)    
 
       
[X]
      ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
       
 
      For the fiscal year ended December 31, 2004
 
       
 
      OR
 
       
[ ]
      TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 
       
 
      For the transition period from                               to                               
 
       
 
      Commission file number                                                                       
 
       
 
  A.   Full title of the plan and the address of the plan, if different from that of the issuer named below:
 
       
 
      NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
 
       
 
  B.   Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:
 
      Nordson Corporation, 28601 Clemens Road, Westlake, Ohio 44145
 
 

 


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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN

FINANCIAL STATEMENTS AND

SUPPLEMENTAL SCHEDULES

DECEMBER 31, 2004 AND 2003
AND YEAR ENDED DECEMBER 31, 2004

with

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 


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 EX-23 Consent

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Retirement Committee and Participants
Nordson Employees’ Savings Trust Plan

We have audited the accompanying statements of net assets available for benefits of the Nordson Employees’ Savings Trust Plan as of December 31, 2004 and 2003, and the related statement of changes in net assets available for benefits for the year ended December 31, 2004. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Plan’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2004 and 2003, and the changes in its net assets available for benefits for the year ended December 31, 2004, in conformity with U.S. generally accepted accounting principles.

Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedules of assets (held at end of the year) as of December 31, 2004 and reportable transactions for the year then ended are presented for purposes of additional analysis and are not a required part of the financial statements but are supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. These supplemental schedules are the responsibility of the Plan’s management. The supplemental schedules have been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, are fairly stated in all material respects in relation to the financial statements taken as a whole.

/s/ Ernst & Young LLP

Cleveland, Ohio
June 21, 2005

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN

STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS

DECEMBER 31, 2004 AND 2003

                 
    2004     2003  
ASSETS
               
 
               
Investments, at fair value
  $ 209,751,149     $ 176,212,154  
 
               
Employer contribution receivable
    138,131       120,498  
 
           
 
               
Net assets available for benefits
  $ 209,889,280     $ 176,332,652  
 
           

See accompanying notes.

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN

STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS

YEAR ENDED DECEMBER 31, 2004

         
Additions:
       
 
       
Investment income:
       
Net appreciation in fair value of investments
    14,842,775  
Interest and dividends
    4,609,014  
 
     
 
    19,451,789  
 
       
Contributions:
       
Employer
    2,681,787  
Employee
    8,219,159  
 
     
 
    10,900,946  
 
     
 
       
Transfer from a plan:
       
EFD, Inc. Profit Sharing Plan & Trust
    10,948,289  
Advanced Plasma Systems Savings and Retirement Plan
    337,312  
Nordson Hourly-Rated Employee Savings Trust Plan
    4,215  
 
     
 
    11,289,816  
 
     
Total additions
    41,642,551  
 
       
Deductions:
       
 
       
Benefit payments and withdrawals
    (8,055,318 )
Expenses
    (30,605 )
 
     
Total deductions
    (8,085,923 )
 
     
 
       
Net increase
    33,556,628  
 
       
Net assets available for benefits at beginning of year
    176,332,652  
 
     
 
       
Net assets available for benefits at end of year
  $ 209,889,280  
 
     

See accompanying notes.

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
AND YEAR ENDED DECEMBER 31, 2004

1. Summary of Significant Accounting Policies

     Method of accounting — Transactions of the Nordson Employees’ Savings Trust Plan (Plan) are accounted for using the accrual method.

     Investment valuation — Investments in equity and debt securities, traded on a national exchange, and mutual funds are valued at the market price on the last business day of the Plan year. Securities traded in the over-the-counter market are valued at the mean between the last reported bid and asked prices. Guaranteed investment contracts are valued at contract value. The fair value of the investment contract at December 31, 2004 and 2003 was $35,762,382 and $34,254,812. The average yield and crediting interest rates were approximately 4.0% for 2004 and 4.5% for 2003. Loans are valued at their outstanding balances, which approximate fair value.

     Income tax status — The Plan has received a determination letter from the Internal Revenue Service dated December 12, 2003, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the Code) and, therefore, the related trust is exempt from taxation. Subsequent to this determination by the Internal Revenue Service, the plan was amended. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code, and, therefore, believes that the Plan, as amended, is qualified and the related trust is tax exempt.

     Employee taxation — Employee before tax contributions, Nordson Corporation (Company) contributions, forfeitures allocated, and earnings on the participant’s account are not subject to tax until distributed from the Plan.

     Other — Purchases and sales of securities are reflected on their trade dates. Gains or losses on sales of securities are based on the average cost of securities.

     Interest is calculated and paid using money market interest rates on late transfers of money between the various funds. This is done to record the proper investment earnings within each fund.

     Use of estimates — The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
NOTES TO FINANCIAL STATEMENTS—CONTINUED

1. Summary of Significant Accounting Policies (continued)

     Plan Mergers – Effective May 3, 2004, the EFD, Inc. Profit Sharing Plan & Trust was merged into the Plan. As a result of the merger, New York Life Investment Management LLC replaced Fleet Bank as trustee. Fleet Bank sold all of the assets of the EFD, Inc. Profit Sharing Plan & Trust and transferred the assets to New York Life Investment Management LLC on May 3, 2004.

     Effective September 1, 2004, the Advanced Plasma Systems Savings and Retirement Plan was merged into the Plan. As a result of the merger, New York Life Investment Management LLC replaced Manulife Financial as trustee. Manulife Financial sold all of the assets of the Advanced Plasma Systems Savings and Retirement Plan and transferred the assets to New York Life Investment Management LLC on September 1, 2004.

2. Investments

     During 2004, the Plan’s investments (including investments purchased, sold, as well as held during the year) appreciated in fair value as follows:

         
    Net appreciation in fair  
    value of investments  
Mutual funds
  $ 7,909,927  
Common/collective trust funds
    753,015  
Nordson Corporation common stock
    6,179,833  
 
     
 
  $ 14,842,775  
 
     

Investments that represent 5% or more of the fair value of the Plan’s net assets at December 31, 2004 and 2003 are as follows:

                 
    2004     2003  
Baron Small Cap Fund
  $ 13,174,484          
Franklin Capital Growth Fund (A)
    19,996,955     $ 19,217,629  
Hartford Life GIC #2374-A
    35,762,382       34,254,812  
KeyBank NA Managed Guaranteed Investment Contract Fund
    16,020,279       16,383,236  
Mainstay S&P 500 Index Fund I
    30,192,470       24,702,501  
Mainstay Balanced Fund I
    11,436,136          
MFS Intl New Discovery A
    13,665,337          
Nordson Corporation Common Stock*
    44,770,011       37,105,346  

* Nonparticipant-directed

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
NOTES TO FINANCIAL STATEMENTS—CONTINUED

2. Investments (continued)

Information about the net assets and the significant components of changes in net assets related to nonparticipant-directed investments is as follows:

Nordson Match Stock Fund

                 
    December 31, 2004     December 31, 2003  
Net assets:
               
Nordson Corporation common stock
  $ 8,023,737     $ 7,281,059
 
Money market funds
    385,985       327,153  
 
           
 
  $ 8,409,722     $ 7,608,212  
 
           
         
    Year ended  
    December 31, 2004  
Changes in net assets:
       
Contributions
  $ 388,559  
Interest and dividend income
    124,369  
Net realized and unrealized gains
    1,119,677  
Distributions to participants
    (283,352 )
Net transfers to participant-directed funds
    (547,743 )
 
     
 
  $ 801,510  
 
     

Nordson ESOP Stock Fund

                 
    December 31, 2004     December 31, 2003  
Net assets:
               
Nordson Corporation common stock
  $ 21,309,466     $ 18,870,929  
Money market funds
    157,079       73,212  
 
           
 
  $ 21,466,546     $ 18,944,141  
 
           
         
    Year ended  
    December 31, 2004  
Changes in net assets:
       
Net appreciation in fair value of common stock
  $ 2,936,291  
Interest income
    352  
Investment expenses
    (1,246 )
Nordson Corporation common stock dividends
    339,252  
Distributions
    (729,714 )
Net transfers to participant-directed funds
    (22,530 )
 
     
 
  $ 2,522,405  
 
     

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
NOTES TO FINANCIAL STATEMENTS—CONTINUED

3. Contributions and Benefits

     The Plan is a defined contribution plan covering salaried, full-time participating domestic employees and part-time domestic employees who work at least 1,000 hours annually, of the Company.

     A participant may elect to have contributions made to the Plan on his behalf of not less than 1% and not more than 16% of his annual compensation. A participant may elect to make contributions either as before-tax deferred compensation contributions through a salary reduction arrangement under Section 401(k) of the Internal Revenue Code, or as after-tax voluntary contributions, or as a combination of the two. After-tax voluntary contributions may be made by payroll deductions or by lump sum payments. A participant may suspend contributions under the Plan at any time by filing a written notice with the Company and the Retirement Committee. After such a suspension, a participant may resume his contributions as of any subsequent enrollment date by filing a written notice with the Company and the Retirement Committee.

     Employees are permitted to participate in the Plan immediately upon their date of hire. The Plan provides participants with the opportunity to change the amount of their contributions and investment elections on a daily basis.

     The Company makes contributions equal to 50% of each participant’s contributions which were attributable to the first 6% of compensation, subject to Plan restrictions. The Company also may make discretionary contributions if authorized by its Board of Directors.

     A separate account in each fund is maintained for each participant. The account balances for participants are adjusted periodically, as follows:

     
a)
  As of the date with respect to which the contribution was earned.
 
   
b)
  Daily for a pro rata share of each respective Fund’s net investment income, determined by the percentage of increase or decrease in the value of the fund.
 
   
c)
  Annually for a pro rata share of forfeitures, determined by the ratio that each active participant’s percentage of regular contribution (1 to 6%) for the plan year bears to the aggregate percentage of employee’s regular contributions for such plan year of all active participants. However, no forfeitures of a participant’s account shall be allocated prior to the earlier of a five year period commencing from the date on which the participant’s employment was terminated or upon the participant requesting distribution.

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
NOTES TO FINANCIAL STATEMENTS—CONTINUED

3. Contributions and Benefits (continued)

     Upon retirement after age 62, or death or disability if earlier, the balance in the separate account is paid to the participant or his beneficiaries either in lump sum or in installments. Until distribution, each account shall participate in the allocation of earnings and appreciation of assets.

     If the employment of a participant is terminated for any cause other than death or total disability prior to the attainment of the age of 62 years, there shall be a distribution based on the number of years the participant participated in the Plan. The portion of the account to be distributed will be equal to all the employee’s contributions and related earnings, plus 20% of the remainder of the balance (the employer’s matching contribution, forfeitures and related earnings) in the separate account for each full year of participation in the Plan up to 100%. Any portion not distributed shall be forfeited.

     While the Company has not expressed any intent to terminate the Plan, it is free to do so at any time. In the event of termination, each participant automatically becomes vested to the extent of the balance in his separate accounts.

4. Investment Programs

     Each participant may direct that all of his contributions and, when the participant is fully vested or attains age 55, all matching employer contributions, be invested jointly in 10% increments in any of the investment funds offered by the Plan.

     For participants not fully vested and less than 55 years old, all Company matching contributions are deposited in the Nordson Match Stock Fund.

     The Plan allows participants to borrow money from their fund accounts. The loans plus interest, at the prime commercial interest rate charged by the Trustee as of the date the loan application is processed, must be repaid in equal installments over the term of the loan. The term cannot be less than six months or greater than five years. Participants may repay the entire balance of the loan in a single lump sum without penalty. The maximum amount a participant may have outstanding is the lesser of $50,000 or 50% of the value of the participant’s nonforfeitable balance in the Plan.

5. ESOP Feature

     Effective October 1, 2000, the Nordson Corporation Non-Union Employees Stock Ownership Plan was merged into the Plan and participant accounts valued at $19,807,501 were transferred to the Plan. As a result of the merger and transfer of participant accounts, an ESOP feature is now maintained under the Plan.

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
NOTES TO FINANCIAL STATEMENTS—CONTINUED

5. ESOP Feature (continued)

     The Company ESOP contribution for each Plan year shall be such amount, if any, as the Board of Directors of the Company shall determine by action specifying the amount of the contribution and the Plan year for which it is being made. The employer’s contribution can be paid in either cash or in Nordson Corporation common shares, or partly in each. For 2004, there was no ESOP contribution to the Plan.

     Separate accounts are maintained for each participant. The participant account balances are adjusted for the employer contributions and forfeitures, which are allocated to each participant’s account in the ratio that each participant’s annual compensation bears to the aggregate annual compensation of all participants. If the employer makes a stock contribution, each participant will receive at least one share of Nordson Corporation common stock. Participant accounts are also adjusted for the change in fair value and earnings of assets of the ESOP fund.

     Unless the Plan committee directs that dividends earned by shares in the ESOP fund are to be paid to the trustee and reinvested in the respective funds, the committee will direct the Company to pay the dividends in cash directly to eligible participants, or in cash to the trustee for distribution to the eligible participants.

     An employee who has participated under the Plan for ten or more years and who has attained age 55 may elect, during their qualified period, to transfer up to 25 percent of the aggregate balance of their separate ESOP account to the participant’s regular Plan account. For the last Plan year in their qualified period they may elect to transfer up to 50 percent of the aggregate balance of their separate account. The qualified period is the six Plan year period beginning with the Plan year following the Plan year in which the participant attains age 55 or completes ten years as a participant, whichever is later.

     Upon retirement on or after age 65, or death or disability if earlier, or termination of employment in the case of vested benefits, the balance in the separate account is paid to the participant or their beneficiaries in a lump sum. The participant or their beneficiaries may elect to receive the distribution in cash or common shares of Nordson Corporation. Until distribution, each account shall be eligible to participate in the allocation of dividends and earnings.

     If the employment of a participant is terminated for any cause other than death or total disability prior to the attainment of the age of 65 years, any distribution will be based on the vested portion of the participant’s account balance. The participant’s account vests at the rate of 20% per full year of the participant’s service with the Company. Any portion not vested at the time of termination (other than due to death or permanent disability or attainment of age 65) shall be forfeited.

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
NOTES TO FINANCIAL STATEMENTS—CONTINUED

6. Transactions with Parties-in-Interest

     Certain legal, accounting and administrative expenses are paid by the Company. Trustee fees are paid from the Trust. Other than as described above and in the notes to the financial statements, the Plan has not had agreements or transactions with parties-in-interest.

7. Risks and Uncertainties

     The Plan invests in various investment securities. Investment securities are exposed to various risks such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the statements of net assets available for benefits.

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
EIN: 34-0590250 PLAN : 002
SCHEDULE H, LINE 4(i)

SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2004
                     
Identity of Issue   Description of Investment   Cost **     Current Value  
Nordson Corporation common stock*
  1,117,295 shares   $ 26,541,372     $ 44,770,011  
Hartford Life
  GIC #2374-A, 4.0%             35,762,382  
Mainstay S&P 500 Index Fund I
  1,081,392 shares             30,192,470  
Franklin Capital Growth Fund (A)
  1,808,043 shares             19,996,955  
KeyBank NA Managed Guaranteed Investment Contract Fund
  865,694 shares             16,020,279  
MFS Intl New Discovery A
  640,363 shares             13,665,337  
Baron Small Cap Fund
  596,670 shares             13,174,484  
Mainstay Balanced Fund I
  427,040 shares             11,436,136  
Mainstay Cash Reserves Fund I
  10,459,460 shares     10,459,460       10,459,460  
PIMCO Total Return Fund (Admin)
  910,692 shares             9,717,078  
Participant Loans*
  At interest rates ranging                
 
  from 4.00% to 10.50%, with                
 
  maturities of varying dates             4,556,557  
 
                 
 
              $ 209,751,149  
 
                 
*   Indicates party-in-interest to the Plan
**   Historical cost provided only for nonparticipant-directed investments

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NORDSON EMPLOYEES’ SAVINGS TRUST PLAN
EIN: 34-0590250 PLAN: 002
SCHEDULE H, LINE 4(j)
SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 2004

                                                 
                                    Current Value        
                                    of Asset        
Identity of   Description     Purchase     Selling     Cost of     on Transaction     Net Gain  
Party Involved   of Asset     Price     Price     Asset     Date     (Loss)  
 
Category (iii) — Series of transactions in excess of 5% of plan assets                        
 
New York Life Trust Company
  Mainstay Cash   $ 10,118,664             $ 10,118,664     $ 10,118,664          
 
  Reserves Fund I                                        

There were no category (i), (ii) or (iv) reportable transactions during the year ended December 31, 2004.

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Exhibits

The following exhibits are filed herewith:

     Exhibit No.

     (23) Consent of Independent Registered Public Accounting Firm

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.

         
 
      NORDSON EMPLOYEES’ SAVINGS
TRUST PLAN
Date: June 29, 2005
       
 
       
 
  By   /s/ PETER S. HELLMAN
 
      Peter S. Hellman
President, Chief Financial and Administrative Officer
Nordson Corporation
 
       
 
  By   /s/ NICHOLAS D. PELLECCHIA
 
      Nicholas D. Pellecchia
Vice President, Finance and Controller
Nordson Corporation

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