Ohio | 34-1919973 | |||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Common Stock, no par value | MTRN | New York Stock Exchange |
Item 1. Financial Statements |
Third Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||
(Thousands, except per share amounts) | September 30, 2022 | October 1, 2021 | September 30, 2022 | October 1, 2021 | ||||||||||||||||||||||
Net sales | $ | 428,191 | $ | 388,028 | $ | 1,322,531 | $ | 1,113,413 | ||||||||||||||||||
Cost of sales | 345,448 | 313,715 | 1,077,070 | 902,723 | ||||||||||||||||||||||
Gross margin | 82,743 | 74,313 | 245,461 | 210,690 | ||||||||||||||||||||||
Selling, general, and administrative expense | 38,958 | 43,195 | 122,666 | 118,031 | ||||||||||||||||||||||
Research and development expense | 7,430 | 6,354 | 22,096 | 19,164 | ||||||||||||||||||||||
Restructuring expense (income) | 484 | — | 1,560 | (378) | ||||||||||||||||||||||
Other—net | 6,774 | 3,604 | 18,575 | 12,272 | ||||||||||||||||||||||
Operating profit | 29,097 | 21,160 | 80,564 | 61,601 | ||||||||||||||||||||||
Other non-operating (income)—net | (1,175) | (1,279) | (3,512) | (3,832) | ||||||||||||||||||||||
Interest expense—net | 5,888 | 861 | 14,325 | 2,480 | ||||||||||||||||||||||
Income before income taxes | 24,384 | 21,578 | 69,751 | 62,953 | ||||||||||||||||||||||
Income tax expense | 4,432 | 3,422 | 12,525 | 10,162 | ||||||||||||||||||||||
Net income | $ | 19,952 | $ | 18,156 | $ | 57,226 | $ | 52,791 | ||||||||||||||||||
Basic earnings per share: | ||||||||||||||||||||||||||
Net income per share of common stock | $ | 0.97 | $ | 0.89 | $ | 2.79 | $ | 2.59 | ||||||||||||||||||
Diluted earnings per share: | ||||||||||||||||||||||||||
Net income per share of common stock | $ | 0.96 | $ | 0.88 | $ | 2.76 | $ | 2.56 | ||||||||||||||||||
Weighted-average number of shares of common stock outstanding: | ||||||||||||||||||||||||||
Basic | 20,526 | 20,439 | 20,502 | 20,414 | ||||||||||||||||||||||
Diluted | 20,780 | 20,657 | 20,756 | 20,659 |
Third Quarter Ended | Nine Months Ended | |||||||||||||||
Sept. 29, | Sept. 30, | Sept. 29, | Sept. 30, | |||||||||||||
(Thousands, except per share amounts) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Net sales | $ | 294,268 | $ | 249,619 | $ | 830,779 | $ | 734,906 | ||||||||
Cost of sales | 239,065 | 198,864 | 678,023 | 595,488 | ||||||||||||
Gross margin | 55,203 | 50,755 | 152,756 | 139,418 | ||||||||||||
Selling, general, and administrative expense | 36,415 | 34,177 | 108,118 | 97,101 | ||||||||||||
Research and development expense | 3,429 | 3,237 | 10,103 | 9,860 | ||||||||||||
Other—net | 3,801 | 3,190 | 9,823 | 8,997 | ||||||||||||
Operating profit | 11,558 | 10,151 | 24,712 | 23,460 | ||||||||||||
Interest expense—net | 533 | 490 | 1,721 | 1,417 | ||||||||||||
Income before income taxes | 11,025 | 9,661 | 22,991 | 22,043 | ||||||||||||
Income tax expense | 1,705 | 1,616 | 3,308 | 3,081 | ||||||||||||
Net income | $ | 9,320 | $ | 8,045 | $ | 19,683 | $ | 18,962 | ||||||||
Basic earnings per share: | ||||||||||||||||
Net income per share of common stock | $ | 0.47 | $ | 0.40 | $ | 0.98 | $ | 0.95 | ||||||||
Diluted earnings per share: | ||||||||||||||||
Net income per share of common stock | $ | 0.46 | $ | 0.40 | $ | 0.97 | $ | 0.94 | ||||||||
Cash dividends per share | $ | 0.100 | $ | 0.095 | $ | 0.295 | $ | 0.280 | ||||||||
Weighted-average number of shares of common stock outstanding: | ||||||||||||||||
Basic | 20,040 | 19,957 | 20,007 | 19,996 | ||||||||||||
Diluted | 20,411 | 20,192 | 20,361 | 20,209 |
Third Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | October 1, | September 30, | October 1, | |||||||||||||||||||||||
(Thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Net income | $ | 19,952 | $ | 18,156 | $ | 57,226 | $ | 52,791 | ||||||||||||||||||
Other comprehensive income (loss): | ||||||||||||||||||||||||||
Foreign currency translation adjustment | (6,094) | (2,029) | (14,484) | (7,693) | ||||||||||||||||||||||
Derivative and hedging activity, net of tax | 4,125 | 439 | 8,289 | 1,411 | ||||||||||||||||||||||
Pension and post-employment benefit adjustment, net of tax | 8 | 121 | (216) | 368 | ||||||||||||||||||||||
Other comprehensive loss | (1,961) | (1,469) | (6,411) | (5,914) | ||||||||||||||||||||||
Comprehensive income | $ | 17,991 | $ | 16,687 | $ | 50,815 | $ | 46,877 |
Third Quarter Ended | Nine Months Ended | |||||||||||||||
Sept. 29, | Sept. 30, | Sept. 29, | Sept. 30, | |||||||||||||
(Thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Net income | $ | 9,320 | $ | 8,045 | $ | 19,683 | $ | 18,962 | ||||||||
Other comprehensive income (loss): | ||||||||||||||||
Foreign currency translation adjustment | 271 | 467 | 1,649 | 2,918 | ||||||||||||
Derivative and hedging activity, net of tax | (120 | ) | 132 | (755 | ) | (489 | ) | |||||||||
Pension and post-employment benefit adjustment, net of tax | 881 | 673 | 2,397 | 2,923 | ||||||||||||
Other comprehensive income | 1,032 | 1,272 | 3,291 | 5,352 | ||||||||||||
Comprehensive income | $ | 10,352 | $ | 9,317 | $ | 22,974 | $ | 24,314 |
September 30, | Dec. 31, | |||||||||||||
(Thousands) | 2022 | 2021 | ||||||||||||
Assets | ||||||||||||||
Current assets | ||||||||||||||
Cash and cash equivalents | $ | 20,682 | $ | 14,462 | ||||||||||
Accounts receivable, net | 238,975 | 223,553 | ||||||||||||
Inventories, net | 420,299 | 361,115 | ||||||||||||
Prepaid and other current assets | 29,708 | 28,122 | ||||||||||||
Total current assets | 709,664 | 627,252 | ||||||||||||
Deferred income taxes | 4,701 | 5,431 | ||||||||||||
Property, plant, and equipment | 1,173,073 | 1,132,223 | ||||||||||||
Less allowances for depreciation, depletion, and amortization | (746,966) | (723,248) | ||||||||||||
Property, plant, and equipment, net | 426,107 | 408,975 | ||||||||||||
Operating lease, right-of-use assets | 65,716 | 63,096 | ||||||||||||
Intangible assets, net | 145,089 | 156,736 | ||||||||||||
Other assets | 32,475 | 27,369 | ||||||||||||
Goodwill | 318,571 | 318,620 | ||||||||||||
Total Assets | $ | 1,702,323 | $ | 1,607,479 | ||||||||||
Liabilities and Shareholders’ Equity | ||||||||||||||
Current liabilities | ||||||||||||||
Short-term debt | $ | 19,747 | $ | 15,359 | ||||||||||
Accounts payable | 96,482 | 86,243 | ||||||||||||
Salaries and wages | 29,974 | 37,544 | ||||||||||||
Other liabilities and accrued items | 47,949 | 53,388 | ||||||||||||
Income taxes | 1,542 | 4,205 | ||||||||||||
Unearned revenue | 6,596 | 7,770 | ||||||||||||
Total current liabilities | 202,290 | 204,509 | ||||||||||||
Other long-term liabilities | 13,991 | 14,954 | ||||||||||||
Operating lease liabilities | 60,248 | 57,099 | ||||||||||||
Finance lease liabilities | 13,009 | 16,327 | ||||||||||||
Retirement and post-employment benefits | 29,421 | 33,394 | ||||||||||||
Unearned income | 110,723 | 97,962 | ||||||||||||
Long-term income taxes | 1,257 | 1,190 | ||||||||||||
Deferred income taxes | 30,427 | 27,216 | ||||||||||||
Long-term debt | 474,280 | 434,388 | ||||||||||||
Shareholders’ equity | ||||||||||||||
Serial preferred stock (no par value; 5,000 authorized shares, none issued) | — | — | ||||||||||||
Common stock (no par value; 60,000 authorized shares, issued shares of 27,148 at both September 30th and December 31st) | 284,024 | 271,978 | ||||||||||||
Retained earnings | 743,283 | 693,756 | ||||||||||||
Common stock in treasury | (219,219) | (209,920) | ||||||||||||
Accumulated other comprehensive loss | (46,580) | (40,169) | ||||||||||||
Other equity | 5,169 | 4,795 | ||||||||||||
Total shareholders' equity | 766,677 | 720,440 | ||||||||||||
Total Liabilities and Shareholders’ Equity | $ | 1,702,323 | $ | 1,607,479 |
(Unaudited) | ||||||||
Sept. 29, | Dec. 31, | |||||||
(Thousands) | 2017 | 2016 | ||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 22,486 | $ | 31,464 | ||||
Accounts receivable | 125,417 | 100,817 | ||||||
Inventories | 220,223 | 200,865 | ||||||
Prepaid and other current assets | 19,115 | 12,138 | ||||||
Total current assets | 387,241 | 345,284 | ||||||
Long-term deferred income taxes | 40,332 | 39,409 | ||||||
Property, plant, and equipment | 877,002 | 861,267 | ||||||
Less allowances for depreciation, depletion, and amortization | (632,435 | ) | (608,636 | ) | ||||
Property, plant, and equipment—net | 244,567 | 252,631 | ||||||
Intangible assets | 10,771 | 11,074 | ||||||
Other assets | 6,312 | 5,950 | ||||||
Goodwill | 89,720 | 86,950 | ||||||
Total Assets | $ | 778,943 | $ | 741,298 | ||||
Liabilities and Shareholders’ Equity | ||||||||
Current liabilities | ||||||||
Short-term debt | $ | 767 | $ | 733 | ||||
Accounts payable | 44,678 | 32,533 | ||||||
Salaries and wages | 30,889 | 29,885 | ||||||
Other liabilities and accrued items | 27,950 | 21,340 | ||||||
Income taxes | 2,953 | 4,781 | ||||||
Unearned revenue | 5,859 | 1,105 | ||||||
Total current liabilities | 113,096 | 90,377 | ||||||
Other long-term liabilities | 18,968 | 17,979 | ||||||
Retirement and post-employment benefits | 92,014 | 91,505 | ||||||
Unearned income | 37,991 | 41,369 | ||||||
Long-term income taxes | 1,593 | 2,100 | ||||||
Deferred income taxes | 279 | 274 | ||||||
Long-term debt | 3,010 | 3,605 | ||||||
Shareholders’ equity | ||||||||
Serial preferred stock | — | — | ||||||
Common stock | 219,817 | 212,702 | ||||||
Retained earnings | 531,683 | 517,903 | ||||||
Common stock in treasury | (161,030 | ) | (154,399 | ) | ||||
Accumulated other comprehensive loss | (82,890 | ) | (86,181 | ) | ||||
Other equity transactions | 4,412 | 4,064 | ||||||
Total shareholders' equity | 511,992 | 494,089 | ||||||
Total Liabilities and Shareholders’ Equity | $ | 778,943 | $ | 741,298 |
Nine Months Ended | Nine Months Ended | |||||||||||||||||||||
Sept. 29, | Sept. 30, | September 30, | October 1, | |||||||||||||||||||
(Thousands) | 2017 | 2016 | (Thousands) | 2022 | 2021 | |||||||||||||||||
Cash flows from operating activities: | Cash flows from operating activities: | |||||||||||||||||||||
Net income | $ | 19,683 | $ | 18,962 | Net income | $ | 57,226 | $ | 52,791 | |||||||||||||
Adjustments to reconcile net income to net cash provided from (used in) operating activities: | ||||||||||||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||||||
Depreciation, depletion, and amortization | 33,444 | 34,379 | Depreciation, depletion, and amortization | 39,223 | 32,478 | |||||||||||||||||
Amortization of deferred financing costs in interest expense | 670 | 417 | Amortization of deferred financing costs in interest expense | 1,310 | 546 | |||||||||||||||||
Stock-based compensation expense (non-cash) | 4,303 | 2,880 | Stock-based compensation expense (non-cash) | 5,997 | 4,924 | |||||||||||||||||
(Gain) loss on sale of property, plant, and equipment | 207 | (601 | ) | |||||||||||||||||||
Deferred income tax expense (benefit) | 1,073 | (676 | ) | Deferred income tax expense (benefit) | 1,825 | (263) | ||||||||||||||||
Changes in assets and liabilities net of acquired assets and liabilities: | ||||||||||||||||||||||
Decrease (increase) in accounts receivable | (21,572 | ) | (19,781 | ) | ||||||||||||||||||
Decrease (increase) in inventory | (9,953 | ) | 3,294 | |||||||||||||||||||
Decrease (increase) in prepaid and other current assets | (6,077 | ) | (956 | ) | ||||||||||||||||||
Increase (decrease) in accounts payable and accrued expenses | 17,991 | (2,207 | ) | |||||||||||||||||||
Increase (decrease) in unearned revenue | 4,746 | (2,546 | ) | |||||||||||||||||||
Increase (decrease) in interest and taxes payable | (2,083 | ) | 898 | |||||||||||||||||||
Increase (decrease) in long-term liabilities | (5,611 | ) | (9,320 | ) | ||||||||||||||||||
Changes in assets and liabilities: | Changes in assets and liabilities: | |||||||||||||||||||||
Accounts receivable | Accounts receivable | (20,964) | (26,041) | |||||||||||||||||||
Inventory | Inventory | (64,832) | (62,353) | |||||||||||||||||||
Prepaid and other current assets | Prepaid and other current assets | (3,019) | (7,020) | |||||||||||||||||||
Accounts payable and accrued expenses | Accounts payable and accrued expenses | (1,785) | 35,314 | |||||||||||||||||||
Unearned revenue | Unearned revenue | (2,191) | 650 | |||||||||||||||||||
Interest and taxes payable | Interest and taxes payable | (1,741) | (1,504) | |||||||||||||||||||
Unearned income due to customer prepayments | Unearned income due to customer prepayments | 17,501 | 9,022 | |||||||||||||||||||
Other-net | (1,324 | ) | 2,479 | Other-net | 5,654 | 1,974 | ||||||||||||||||
Net cash provided by operating activities | 35,497 | 27,222 | Net cash provided by operating activities | 34,204 | 40,518 | |||||||||||||||||
Cash flows from investing activities: | Cash flows from investing activities: | |||||||||||||||||||||
Payments for purchase of property, plant, and equipment | (17,759 | ) | (20,052 | ) | Payments for purchase of property, plant, and equipment | (54,236) | (77,640) | |||||||||||||||
Payments for mine development | (620 | ) | (8,934 | ) | ||||||||||||||||||
Proceeds from sale of property, plant, and equipment | Proceeds from sale of property, plant, and equipment | 827 | 686 | |||||||||||||||||||
Payments for acquisition | (16,504 | ) | — | Payments for acquisition | (2,971) | — | ||||||||||||||||
Proceeds from sale of property, plant, and equipment | 53 | 1,366 | ||||||||||||||||||||
Net cash used in investing activities | (34,830 | ) | (27,620 | ) | Net cash used in investing activities | (56,380) | (76,954) | |||||||||||||||
Cash flows from financing activities: | Cash flows from financing activities: | |||||||||||||||||||||
Proceeds from issuance of short-term debt, net | — | 3,777 | ||||||||||||||||||||
Proceeds from issuance of long-term debt | 55,000 | 10,000 | ||||||||||||||||||||
Proceeds from borrowings under revolving credit agreement, net | Proceeds from borrowings under revolving credit agreement, net | 49,092 | 43,010 | |||||||||||||||||||
Proceeds from issuance of debt | Proceeds from issuance of debt | 6,643 | — | |||||||||||||||||||
Repayment of long-term debt | (55,608 | ) | (10,517 | ) | Repayment of long-term debt | (11,761) | (1,803) | |||||||||||||||
Principal payments under capital lease obligations | (644 | ) | (549 | ) | ||||||||||||||||||
Principal payments under finance lease obligations | Principal payments under finance lease obligations | (1,985) | (2,152) | |||||||||||||||||||
Cash dividends paid | (5,903 | ) | (5,601 | ) | Cash dividends paid | (7,584) | (7,243) | |||||||||||||||
Deferred financing costs | (300 | ) | (1,000 | ) | ||||||||||||||||||
Common shares withheld for taxes | (2,397 | ) | (868 | ) | ||||||||||||||||||
Repurchase of common stock | (1,086 | ) | (3,798 | ) | ||||||||||||||||||
Net cash used in financing activities | (10,938 | ) | (8,556 | ) | ||||||||||||||||||
Payments of withholding taxes for stock-based compensation awards | Payments of withholding taxes for stock-based compensation awards | (3,056) | (3,033) | |||||||||||||||||||
Net cash provided by financing activities | Net cash provided by financing activities | 31,349 | 28,779 | |||||||||||||||||||
Effects of exchange rate changes | 1,293 | 524 | Effects of exchange rate changes | (2,953) | (212) | |||||||||||||||||
Net change in cash and cash equivalents | (8,978 | ) | (8,430 | ) | Net change in cash and cash equivalents | 6,220 | (7,869) | |||||||||||||||
Cash and cash equivalents at beginning of period | 31,464 | 24,236 | Cash and cash equivalents at beginning of period | 14,462 | 25,878 | |||||||||||||||||
Cash and cash equivalents at end of period | $ | 22,486 | $ | 15,806 | Cash and cash equivalents at end of period | $ | 20,682 | $ | 18,009 |
Common Shares | Shareholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||||
(Thousands, except per share amounts) | Common Shares | Common Shares Held in Treasury | Common Stock | Retained Earnings | Common Stock in Treasury | Accumulated Other Comprehensive Loss | Other Equity | Total | |||||||||||||||||||||||||||||||||||||||
Balance at July 1, 2022 | 20,523 | (6,625) | $ | 281,296 | $ | 725,918 | $ | (218,356) | $ | (44,619) | $ | 4,915 | $ | 749,154 | |||||||||||||||||||||||||||||||||
Net income | — | — | — | 19,952 | — | — | — | 19,952 | |||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | (1,961) | — | (1,961) | |||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($0.125 per share) | — | — | — | (2,557) | — | — | — | (2,557) | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation activity | 6 | 6 | 2,695 | (30) | (392) | — | — | 2,273 | |||||||||||||||||||||||||||||||||||||||
Payments of withholding taxes for stock-based compensation awards | (2) | (2) | — | — | (244) | — | — | (244) | |||||||||||||||||||||||||||||||||||||||
Directors’ deferred compensation | 1 | 1 | 33 | — | (227) | — | 254 | 60 | |||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | 20,528 | (6,620) | $ | 284,024 | $ | 743,283 | $ | (219,219) | $ | (46,580) | $ | 5,169 | $ | 766,677 | |||||||||||||||||||||||||||||||||
Balance at July 2, 2021 | 20,438 | (6,710) | $ | 268,205 | $ | 660,851 | $ | (208,854) | $ | (43,084) | $ | 4,583 | $ | 681,701 | |||||||||||||||||||||||||||||||||
Net income | — | — | — | 18,156 | — | — | — | 18,156 | |||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | (1,469) | — | (1,469) | |||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($0.120 per share) | — | — | — | (2,452) | — | — | — | (2,452) | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation activity | — | — | 1,458 | (28) | (18) | — | — | 1,412 | |||||||||||||||||||||||||||||||||||||||
Payments of withholding taxes for stock-based compensation awards | — | — | — | — | (12) | — | — | (12) | |||||||||||||||||||||||||||||||||||||||
Directors’ deferred compensation | 1 | 1 | 53 | — | (68) | — | 107 | 92 | |||||||||||||||||||||||||||||||||||||||
Balance at October 1, 2021 | 20,439 | (6,709) | $ | 269,716 | $ | 676,527 | $ | (208,952) | $ | (44,553) | $ | 4,690 | $ | 697,428 |
Common Shares | Shareholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||||
(Thousands, except per share amounts) | Common Shares | Common Shares Held in Treasury | Common Stock | Retained Earnings | Common Stock in Treasury | Accumulated Other Comprehensive Loss | Other Equity | Total | |||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | 20,448 | (6,700) | $ | 271,978 | $ | 693,756 | $ | (209,920) | $ | (40,169) | $ | 4,795 | $ | 720,440 | |||||||||||||||||||||||||||||||||
Net income | — | — | — | 57,226 | — | — | — | 57,226 | |||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | (6,411) | — | (6,411) | |||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($0.370 per share) | — | — | — | (7,584) | — | — | — | (7,584) | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation activity | 115 | 115 | 11,938 | (115) | (5,941) | — | — | 5,882 | |||||||||||||||||||||||||||||||||||||||
Payments of withholding taxes for stock-based compensation awards | (37) | (37) | — | — | (3,056) | — | — | (3,056) | |||||||||||||||||||||||||||||||||||||||
Directors’ deferred compensation | 2 | 2 | 108 | — | (302) | — | 374 | 180 | |||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | 20,528 | (6,620) | $ | 284,024 | $ | 743,283 | $ | (219,219) | $ | (46,580) | $ | 5,169 | $ | 766,677 | |||||||||||||||||||||||||||||||||
Balance at December 31, 2020 | 20,328 | (6,820) | $ | 258,642 | $ | 631,058 | $ | (199,187) | $ | (38,639) | $ | 3,756 | $ | 655,630 | |||||||||||||||||||||||||||||||||
Net income | — | — | — | 52,791 | — | — | — | 52,791 | |||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | (5,914) | — | (5,914) | |||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($0.355 per share) | — | — | — | (7,243) | — | — | — | (7,243) | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation activity | 152 | 152 | 10,932 | (79) | (5,929) | — | — | 4,924 | |||||||||||||||||||||||||||||||||||||||
Payments of withholding taxes for stock-based compensation awards | (45) | (45) | — | — | (3,033) | — | — | (3,033) | |||||||||||||||||||||||||||||||||||||||
Directors’ deferred compensation | 4 | 4 | $ | 142 | $ | — | $ | (803) | $ | — | $ | 934 | $ | 273 | |||||||||||||||||||||||||||||||||
Balance at October 1, 2021 | 20,439 | (6,709) | $ | 269,716 | $ | 676,527 | $ | (208,952) | $ | (44,553) | $ | 4,690 | $ | 697,428 |
(Thousands) | Initial Allocation of Consideration | Measurement Period Adjustments | Updated Allocation | |||||||||||||||||
Assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 3,685 | $ | — | $ | 3,685 | ||||||||||||||
Accounts receivable | 28,352 | (132) | 28,220 | |||||||||||||||||
Inventories | 70,681 | — | 70,681 | |||||||||||||||||
Prepaid and other current assets | 660 | (355) | 305 | |||||||||||||||||
Property, plant, and equipment | 44,681 | 355 | 45,036 | |||||||||||||||||
Operating lease, right-of-use assets | 6,120 | — | 6,120 | |||||||||||||||||
Intangible assets | 107,800 | — | 107,800 | |||||||||||||||||
Other long-term assets | 4,528 | — | 4,528 | |||||||||||||||||
Goodwill | 178,181 | 4,010 | 182,191 | |||||||||||||||||
Total assets acquired | $ | 444,688 | $ | 3,878 | $ | 448,566 | ||||||||||||||
Liabilities: | ||||||||||||||||||||
Accounts payable | $ | 12,139 | $ | — | $ | 12,139 | ||||||||||||||
Salaries and wages | 2,516 | 625 | 3,141 | |||||||||||||||||
Other liabilities and accrued items | 28 | — | 28 | |||||||||||||||||
Income taxes | 2,183 | 79 | 2,262 | |||||||||||||||||
Other long-term liabilities | 5,543 | 215 | 5,758 | |||||||||||||||||
Operating lease liabilities | 6,042 | — | 6,042 | |||||||||||||||||
Deferred income taxes | 20,300 | — | 20,300 | |||||||||||||||||
Total liabilities assumed | $ | 48,751 | $ | 919 | $ | 49,670 | ||||||||||||||
Net assets acquired | $ | 395,937 | $ | 2,959 | $ | 398,896 |
(Thousands) | Amount | ||
Assets: | |||
Inventories | $ | 7,221 | |
Prepaid and other current assets | 1,107 | ||
Long-term deferred income taxes | 1,450 | ||
Property, plant, and equipment | 7,637 | ||
Intangible assets | 3,236 | ||
Goodwill | 2,605 | ||
Total assets acquired | $ | 23,256 | |
Liabilities: | |||
Other liabilities and accrued items | $ | 1,030 | |
Other long-term liabilities | 430 | ||
Retirement and post-employment benefits | 5,292 | ||
Total liabilities assumed | $ | 6,752 | |
Total purchase price | $ | 16,504 |
(Thousands) | Value at Acquisition | Useful Life | ||||
Customer relationships | $ | 1,861 | 15 years | |||
Technology | 1,375 | 3 years | ||||
Total | $ | 3,236 |
(Thousands) | Value at Acquisition | Useful Life | ||||||||||||
Customer relationships | $ | 50,200 | 13 years | |||||||||||
Technology | 35,300 | 13 years | ||||||||||||
Trade name | 22,300 | 15 years | ||||||||||||
Total | $ | 107,800 |
(Unaudited) | ||||||||
Three months ended | Nine months ended | |||||||
October 1, 2021 | October 1, 2021 | |||||||
Net Sales | $ | 428,864 | $ | 1,223,450 | ||||
Income before taxes | $ | 23,022 | $ | 65,926 |
(Thousands) | Performance Alloys and Composites | Advanced Materials | Precision Coatings | Other | Total | |||||||||||||||
Third Quarter 2017 | ||||||||||||||||||||
Net sales | $ | 109,393 | $ | 157,770 | $ | 27,105 | $ | — | $ | 294,268 | ||||||||||
Intersegment sales | 54 | 12,814 | — | — | 12,868 | |||||||||||||||
Value-added sales | 90,637 | 60,391 | 21,896 | (1,542 | ) | 171,382 | ||||||||||||||
Operating profit (loss) | 6,786 | 9,756 | 1,613 | (6,597 | ) | 11,558 | ||||||||||||||
Third Quarter 2016 | ||||||||||||||||||||
Net sales | $ | 103,699 | $ | 107,250 | $ | 38,670 | $ | — | $ | 249,619 | ||||||||||
Intersegment sales | 47 | 21,505 | — | — | 21,552 | |||||||||||||||
Value-added sales | 87,247 | 45,960 | 25,803 | (2,009 | ) | 157,001 | ||||||||||||||
Operating profit (loss) | 4,357 | 8,245 | 3,432 | (5,883 | ) | 10,151 | ||||||||||||||
First Nine Months 2017 | ||||||||||||||||||||
Net sales | $ | 310,487 | $ | 429,550 | $ | 90,742 | $ | — | $ | 830,779 | ||||||||||
Intersegment sales | 113 | 42,508 | — | — | 42,621 | |||||||||||||||
Value-added sales | 262,534 | 169,720 | 67,810 | (3,602 | ) | 496,462 | ||||||||||||||
Operating profit (loss) | 12,523 | 24,873 | 6,145 | (18,829 | ) | 24,712 | ||||||||||||||
First Nine Months 2016 | ||||||||||||||||||||
Net sales | $ | 292,024 | $ | 328,927 | $ | 113,955 | $ | — | $ | 734,906 | ||||||||||
Intersegment sales | 226 | 54,110 | — | — | 54,336 | |||||||||||||||
Value-added sales | 248,799 | 135,019 | 75,548 | (4,573 | ) | 454,793 | ||||||||||||||
Operating profit (loss) | 6,103 | 20,748 | 9,803 | (13,194 | ) | 23,460 |
(Thousands) | Third Quarter 2022 | Third Quarter 2021 | First Nine Months 2022 | First Nine Months 2021 | ||||||||||||||||||||||
Net sales: | ||||||||||||||||||||||||||
Performance Materials(1) | $ | 169,357 | $ | 136,096 | $ | 473,876 | $ | 375,533 | ||||||||||||||||||
Electronic Materials(1) | 230,841 | 220,723 | 762,649 | 638,481 | ||||||||||||||||||||||
Precision Optics | 27,993 | 31,209 | 86,006 | 99,399 | ||||||||||||||||||||||
Other | — | — | — | — | ||||||||||||||||||||||
Net sales | 428,191 | 388,028 | 1,322,531 | 1,113,413 | ||||||||||||||||||||||
Segment EBITDA: | ||||||||||||||||||||||||||
Performance Materials | $ | 28,866 | $ | 28,917 | $ | 80,886 | $ | 68,027 | ||||||||||||||||||
Electronic Materials | 16,853 | 11,326 | 51,338 | 32,668 | ||||||||||||||||||||||
Precision Optics | 3,546 | 6,228 | 9,281 | 19,246 | ||||||||||||||||||||||
Other | (5,839) | (10,617) | (18,206) | (22,030) | ||||||||||||||||||||||
Total Segment EBITDA | 43,426 | 35,854 | 123,299 | 97,911 | ||||||||||||||||||||||
Income tax expense | 4,432 | 3,422 | 12,525 | 10,162 | ||||||||||||||||||||||
Interest expense - net | 5,888 | 861 | 14,325 | 2,480 | ||||||||||||||||||||||
Depreciation, depletion and amortization | 13,154 | $ | 13,415 | $ | 39,223 | $ | 32,478 | |||||||||||||||||||
Net income | $ | 19,952 | $ | 18,156 | $ | 57,226 | $ | 52,791 |
(Thousands) | Performance Materials | Electronic Materials | Precision Optics | Other | Total | |||||||||||||||||||||||||||
Third Quarter 2022 | ||||||||||||||||||||||||||||||||
End Market | ||||||||||||||||||||||||||||||||
Semiconductor | $ | 2,410 | $ | 185,223 | $ | 1,151 | $ | — | $ | 188,784 | ||||||||||||||||||||||
Industrial | 44,667 | 9,383 | 7,564 | — | 61,614 | |||||||||||||||||||||||||||
Aerospace and defense | 28,262 | 1,243 | 3,532 | — | 33,037 | |||||||||||||||||||||||||||
Consumer electronics | 9,607 | 364 | 6,799 | — | 16,770 | |||||||||||||||||||||||||||
Automotive | 24,802 | 1,863 | 2,268 | — | 28,933 | |||||||||||||||||||||||||||
Energy | 15,854 | 25,220 | — | — | 41,074 | |||||||||||||||||||||||||||
Telecom and data center | 15,412 | 42 | — | — | 15,454 | |||||||||||||||||||||||||||
Other | 28,343 | 7,503 | 6,679 | — | 42,525 | |||||||||||||||||||||||||||
Total | $ | 169,357 | $ | 230,841 | $ | 27,993 | $ | — | $ | 428,191 | ||||||||||||||||||||||
Third Quarter 2021 | ||||||||||||||||||||||||||||||||
End Market | ||||||||||||||||||||||||||||||||
Semiconductor | $ | 3,163 | $ | 173,689 | $ | 630 | $ | — | $ | 177,482 | ||||||||||||||||||||||
Industrial | 31,521 | 10,479 | 8,296 | — | 50,296 | |||||||||||||||||||||||||||
Aerospace and defense | 19,129 | 1,622 | 5,653 | — | 26,404 | |||||||||||||||||||||||||||
Consumer electronics | 9,717 | 530 | 7,789 | — | 18,036 | |||||||||||||||||||||||||||
Automotive | 28,922 | 1,719 | 2,571 | — | 33,212 | |||||||||||||||||||||||||||
Energy | 7,524 | 27,081 | — | — | 34,605 | |||||||||||||||||||||||||||
Telecom and data center | 14,980 | 31 | — | — | 15,011 | |||||||||||||||||||||||||||
Other | 21,140 | 5,572 | 6,270 | — | 32,982 | |||||||||||||||||||||||||||
Total | $ | 136,096 | $ | 220,723 | $ | 31,209 | $ | — | $ | 388,028 |
Third Quarter Ended | Nine Months Ended | |||||||||||||||
Sept. 29, | Sept. 30, | Sept. 29, | Sept. 30, | |||||||||||||
(Thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Metal consignment fees | $ | 2,436 | $ | 1,665 | $ | 6,183 | $ | 4,851 | ||||||||
Amortization of intangible assets | 1,179 | 1,148 | 3,456 | 3,444 | ||||||||||||
Foreign currency exchange/translation loss (gain) | (201 | ) | 336 | (794 | ) | 977 | ||||||||||
Fixed asset impairment | 114 | — | 314 | — | ||||||||||||
Cost reduction initiatives | 189 | — | 189 | — | ||||||||||||
Net loss (gain) on disposal of fixed assets | 60 | 94 | 207 | (601 | ) | |||||||||||
Other items | 24 | (53 | ) | 268 | 326 | |||||||||||
Total | $ | 3,801 | $ | 3,190 | $ | 9,823 | $ | 8,997 |
(Thousands) | Performance Materials | Electronic Materials | Precision Optics | Other | Total | |||||||||||||||||||||||||||
First Nine Months 2022 | ||||||||||||||||||||||||||||||||
End Market | ||||||||||||||||||||||||||||||||
Semiconductor | $ | 6,657 | $ | 613,887 | $ | 4,007 | $ | — | $ | 624,551 | ||||||||||||||||||||||
Industrial | 127,187 | 37,206 | 23,605 | — | 187,998 | |||||||||||||||||||||||||||
Aerospace and defense | 79,561 | 5,141 | 12,344 | — | 97,046 | |||||||||||||||||||||||||||
Consumer electronics | 38,822 | 969 | 17,925 | — | 57,716 | |||||||||||||||||||||||||||
Automotive | 71,893 | 4,985 | 7,294 | — | 84,172 | |||||||||||||||||||||||||||
Energy | 36,632 | 79,701 | — | — | 116,333 | |||||||||||||||||||||||||||
Telecom and data center | 47,716 | 107 | — | — | 47,823 | |||||||||||||||||||||||||||
Other | 65,408 | 20,653 | 20,831 | — | 106,892 | |||||||||||||||||||||||||||
Total | $ | 473,876 | $ | 762,649 | $ | 86,006 | $ | — | $ | 1,322,531 | ||||||||||||||||||||||
First Nine Months 2021 | ||||||||||||||||||||||||||||||||
End Market | ||||||||||||||||||||||||||||||||
Semiconductor | $ | 5,966 | $ | 495,718 | $ | 1,664 | $ | — | $ | 503,348 | ||||||||||||||||||||||
Industrial | 85,815 | 33,756 | 23,305 | — | 142,876 | |||||||||||||||||||||||||||
Aerospace and defense | 60,221 | 4,680 | 17,825 | — | 82,726 | |||||||||||||||||||||||||||
Consumer electronics | 30,483 | 961 | 24,212 | — | 55,656 | |||||||||||||||||||||||||||
Automotive | 78,195 | 5,145 | 6,871 | — | 90,211 | |||||||||||||||||||||||||||
Energy | 16,541 | 78,487 | — | — | 95,028 | |||||||||||||||||||||||||||
Telecom and data center | 39,348 | 140 | — | — | 39,488 | |||||||||||||||||||||||||||
Other | 58,964 | 19,594 | 25,522 | — | 104,080 | |||||||||||||||||||||||||||
Total | $ | 375,533 | $ | 638,481 | $ | 99,399 | $ | — | $ | 1,113,413 |
(Thousands) | September 30, 2022 | December 31, 2021 | $ change | % change | ||||||||||||||||||||||
Accounts receivable, trade | $ | 229,171 | $ | 213,584 | $ | 15,587 | 7 | % | ||||||||||||||||||
Unbilled receivables | 9,654 | 7,961 | 1,693 | 21 | % | |||||||||||||||||||||
Unearned revenue | 6,596 | 7,770 | (1,174) | (15) | % |
Third Quarter Ended | Nine Months Ended | |||||||||||||||
(Thousands) | Sept. 29, 2017 | Sept. 30, 2016 | Sept. 29, 2017 | Sept. 30, 2016 | ||||||||||||
Cost of sales | $ | 346 | $ | — | $ | 463 | $ | — | ||||||||
Selling, general, and administrative (SG&A) expense | 127 | — | 1,259 | — | ||||||||||||
Other-net | 189 | — | 189 | — | ||||||||||||
Total | $ | 662 | $ | — | $ | 1,911 | $ | — |
Third Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | October 1, | September 30, | October 1, | |||||||||||||||||||||||
(Thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Amortization of intangible assets | $ | 3,088 | $ | 1,283 | $ | 9,318 | $ | 3,461 | ||||||||||||||||||
Metal consignment fees | 3,111 | 2,243 | 8,993 | 6,857 | ||||||||||||||||||||||
Foreign currency (gain) loss | 235 | 380 | (70) | 1,596 | ||||||||||||||||||||||
Net loss (gain) on disposal of fixed assets | (1) | 81 | 17 | (283) | ||||||||||||||||||||||
Other items | 341 | (383) | 317 | 641 | ||||||||||||||||||||||
Total | $ | 6,774 | $ | 3,604 | $ | 18,575 | $ | 12,272 |
Third Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | October 1, | September 30, | October 1, | |||||||||||||||||||||||
(Thousands, except per share amounts) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Numerator for basic and diluted EPS: | ||||||||||||||||||||||||||
Net income | $ | 19,952 | $ | 18,156 | $ | 57,226 | $ | 52,791 | ||||||||||||||||||
Denominator: | ||||||||||||||||||||||||||
Denominator for basic EPS: | ||||||||||||||||||||||||||
Weighted-average shares outstanding | 20,526 | 20,439 | 20,502 | 20,414 | ||||||||||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||||||||
Stock appreciation rights | 85 | 72 | 85 | 73 | ||||||||||||||||||||||
Restricted stock units | 98 | 94 | 113 | 113 | ||||||||||||||||||||||
Performance-based restricted stock units | 71 | 52 | 55 | 59 | ||||||||||||||||||||||
Diluted potential common shares | 254 | 218 | 254 | 245 | ||||||||||||||||||||||
Denominator for diluted EPS: | ||||||||||||||||||||||||||
Adjusted weighted-average shares outstanding | 20,780 | 20,657 | 20,756 | 20,659 | ||||||||||||||||||||||
Basic EPS | $ | 0.97 | $ | 0.89 | $ | 2.79 | $ | 2.59 | ||||||||||||||||||
Diluted EPS | $ | 0.96 | $ | 0.88 | $ | 2.76 | $ | 2.56 |
Third Quarter Ended | Nine Months Ended | |||||||||||||||
Sept. 29, | Sept. 30, | Sept. 29, | Sept. 30, | |||||||||||||
(Thousands, except per share amounts) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Numerator for basic and diluted EPS: | ||||||||||||||||
Net income | $ | 9,320 | $ | 8,045 | $ | 19,683 | $ | 18,962 | ||||||||
Denominator: | ||||||||||||||||
Denominator for basic EPS: | ||||||||||||||||
Weighted-average shares outstanding | 20,040 | 19,957 | 20,007 | 19,996 | ||||||||||||
Effect of dilutive securities: | ||||||||||||||||
Stock appreciation rights | 149 | 70 | 148 | 66 | ||||||||||||
Restricted stock units | 94 | 82 | 95 | 86 | ||||||||||||
Performance-based restricted stock units | 128 | 83 | 111 | 61 | ||||||||||||
Diluted potential common shares | 371 | 235 | 354 | 213 | ||||||||||||
Denominator for diluted EPS: | ||||||||||||||||
Adjusted weighted-average shares outstanding | 20,411 | 20,192 | 20,361 | 20,209 | ||||||||||||
Basic EPS | $ | 0.47 | $ | 0.40 | $ | 0.98 | $ | 0.95 | ||||||||
Diluted EPS | $ | 0.46 | $ | 0.40 | $ | 0.97 | $ | 0.94 |
Sept. 29, | Dec. 31, | September 30, | December 31, | |||||||||||||||||||
(Thousands) | 2017 | 2016 | (Thousands) | 2022 | 2021 | |||||||||||||||||
Raw materials and supplies | $ | 44,924 | $ | 36,233 | Raw materials and supplies | $ | 114,225 | $ | 93,518 | |||||||||||||
Work in process | 181,553 | 169,327 | Work in process | 252,077 | 221,638 | |||||||||||||||||
Finished goods | 37,671 | 38,147 | Finished goods | 53,997 | 45,959 | |||||||||||||||||
Subtotal | $ | 264,148 | $ | 243,707 | ||||||||||||||||||
Less: LIFO reserve balance | 43,925 | 42,842 | ||||||||||||||||||||
Inventories | $ | 220,223 | $ | 200,865 | ||||||||||||||||||
Inventories, net | Inventories, net | $ | 420,299 | $ | 361,115 |
Pension Benefits | Other Benefits | |||||||||||||||||||||||||
Third Quarter Ended | Third Quarter Ended | |||||||||||||||||||||||||
September 30, | October 1, | September 30, | October 1, | |||||||||||||||||||||||
(Thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Components of net periodic benefit (credit) cost | ||||||||||||||||||||||||||
Service cost | $ | 281 | $ | 410 | $ | 21 | $ | 20 | ||||||||||||||||||
Interest cost | 1,203 | 1,045 | 39 | 29 | ||||||||||||||||||||||
Expected return on plan assets | (2,380) | (2,459) | — | — | ||||||||||||||||||||||
Amortization of prior service (benefit) cost | (19) | (18) | (374) | (374) | ||||||||||||||||||||||
Amortization of net loss (gain) | 410 | 565 | (68) | (69) | ||||||||||||||||||||||
Net periodic benefit (credit) cost | $ | (505) | $ | (457) | $ | (382) | $ | (394) | ||||||||||||||||||
Settlements | — | — | — | — | ||||||||||||||||||||||
Total net benefit (credit) cost | $ | (505) | $ | (457) | $ | (382) | $ | (394) |
Pension Benefits | Other Benefits | |||||||||||||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | October 1, | September 30, | October 1, | |||||||||||||||||||||||
(Thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Components of net periodic benefit (credit) cost | ||||||||||||||||||||||||||
Service cost | $ | 891 | $ | 1,284 | $ | 63 | $ | 60 | ||||||||||||||||||
Interest cost | 3,639 | 3,141 | 117 | 87 | ||||||||||||||||||||||
Expected return on plan assets | (7,158) | (7,407) | — | — | ||||||||||||||||||||||
Amortization of prior service (benefit) cost | (57) | (60) | (1,122) | (1,122) | ||||||||||||||||||||||
Amortization of net loss (gain) | 1,260 | 1,719 | (204) | (207) | ||||||||||||||||||||||
Net periodic benefit (credit) cost | $ | (1,425) | $ | (1,323) | $ | (1,146) | $ | (1,182) | ||||||||||||||||||
Settlements | — | — | — | — | ||||||||||||||||||||||
Total net benefit (credit) cost | $ | (1,425) | $ | (1,323) | $ | (1,146) | $ | (1,182) |
Pension Benefits | Other Benefits | |||||||||||||||
Third Quarter Ended | Third Quarter Ended | |||||||||||||||
Sept. 29, | Sept. 30, | Sept. 29, | Sept. 30, | |||||||||||||
(Thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Components of net periodic benefit cost (benefit) | ||||||||||||||||
Service cost | $ | 2,106 | $ | 1,946 | $ | 23 | $ | 26 | ||||||||
Interest cost | 2,372 | 2,595 | 99 | 140 | ||||||||||||
Expected return on plan assets | (3,678 | ) | (3,488 | ) | — | — | ||||||||||
Amortization of prior service benefit | (42 | ) | (115 | ) | (374 | ) | (374 | ) | ||||||||
Amortization of net loss | 1,623 | 1,431 | — | — | ||||||||||||
Net periodic benefit cost (benefit) | $ | 2,381 | $ | 2,369 | $ | (252 | ) | $ | (208 | ) | ||||||
Pension Benefits | Other Benefits | |||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||
Sept. 29, | Sept. 30, | Sept. 29, | Sept. 30, | |||||||||||||
(Thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Components of net periodic benefit cost (benefit) | ||||||||||||||||
Service cost | $ | 6,188 | $ | 5,838 | $ | 69 | $ | 77 | ||||||||
Interest cost | 7,098 | 7,785 | 297 | 422 | ||||||||||||
Expected return on plan assets | (11,007 | ) | (10,464 | ) | — | — | ||||||||||
Amortization of prior service benefit | (236 | ) | (345 | ) | (1,122 | ) | (1,122 | ) | ||||||||
Amortization of net loss | 4,821 | 4,292 | — | — | ||||||||||||
Net periodic benefit cost (benefit) | $ | 6,864 | $ | 7,106 | $ | (756 | ) | $ | (623 | ) |
Gains and Losses on Cash Flow Hedges | ||||||||||||||||||||||||||||||||||||||||||||||||||
(Thousands) | Foreign Currency | Interest Rate | Precious Metals | Copper | Total | Pension and Post-Employment Benefits | Foreign Currency Translation | Total | ||||||||||||||||||||||||||||||||||||||||||
Balance at July 1, 2022 | $ | 3,226 | $ | 3,250 | $ | 108 | $ | — | $ | 6,584 | $ | (39,926) | $ | (11,277) | $ | (44,619) | ||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) before reclassifications | 837 | 4,360 | 441 | — | 5,638 | — | (6,094) | (456) | ||||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (41) | (115) | (126) | — | (282) | (18) | — | (300) | ||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive (loss) income before tax | 796 | 4,245 | 315 | — | 5,356 | (18) | (6,094) | (756) | ||||||||||||||||||||||||||||||||||||||||||
Deferred taxes | 183 | 976 | 72 | — | 1,231 | (26) | — | 1,205 | ||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive (loss) income after tax | 613 | 3,269 | 243 | — | 4,125 | 8 | (6,094) | (1,961) | ||||||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | $ | 3,839 | $ | 6,519 | $ | 351 | $ | — | $ | 10,709 | $ | (39,918) | $ | (17,371) | $ | (46,580) | ||||||||||||||||||||||||||||||||||
Balance at July 2, 2021 | $ | 1,603 | $ | — | $ | 186 | $ | — | $ | 1,789 | $ | (43,226) | $ | (1,647) | $ | (43,084) | ||||||||||||||||||||||||||||||||||
Other comprehensive (loss) income before reclassifications | 625 | — | 30 | 8 | 663 | — | (2,029) | (1,366) | ||||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (2) | — | (83) | (8) | (93) | 114 | — | 21 | ||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive (loss) income before tax | 623 | — | (53) | — | 570 | 114 | (2,029) | (1,345) | ||||||||||||||||||||||||||||||||||||||||||
Deferred taxes | 143 | (12) | — | 131 | (7) | — | 124 | |||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive (loss) income after tax | 480 | — | (41) | — | 439 | 121 | (2,029) | (1,469) | ||||||||||||||||||||||||||||||||||||||||||
Balance at October 1, 2021 | $ | 2,083 | $ | — | $ | 145 | $ | — | $ | 2,228 | $ | (43,105) | $ | (3,676) | $ | (44,553) |
Gains and Losses on Cash Flow Hedges | ||||||||||||||||||||||||
(Thousands) | Foreign Currency | Precious Metals | Total | Pension and Post-Employment Benefits | Foreign Currency Translation | Total | ||||||||||||||||||
Balance at June 30, 2017 | $ | 1,109 | $ | 93 | $ | 1,202 | $ | (80,842 | ) | $ | (4,282 | ) | $ | (83,922 | ) | |||||||||
Other comprehensive income (loss) before reclassifications | (324 | ) | (205 | ) | (529 | ) | — | 271 | (258 | ) | ||||||||||||||
Amounts reclassified from accumulated other comprehensive income | 433 | (94 | ) | 339 | 1,345 | — | 1,684 |
Gains and Losses on Cash Flow Hedges | ||||||||||||||||||||||||
(Thousands) | Foreign Currency | Precious Metals | Total | Pension and Post-Employment Benefits | Foreign Currency Translation | Total | ||||||||||||||||||
Net current period other comprehensive income (loss) before tax | 109 | (299 | ) | (190 | ) | 1,345 | 271 | 1,426 | ||||||||||||||||
Deferred taxes on current period activity | 41 | (111 | ) | (70 | ) | 464 | — | 394 | ||||||||||||||||
Net current period other comprehensive income (loss) after tax | 68 | (188 | ) | (120 | ) | 881 | 271 | 1,032 | ||||||||||||||||
Balance at September 29, 2017 | $ | 1,177 | $ | (95 | ) | $ | 1,082 | $ | (79,961 | ) | $ | (4,011 | ) | $ | (82,890 | ) | ||||||||
Balance at July 1, 2016 | $ | 958 | $ | — | $ | 958 | $ | (74,546 | ) | $ | (3,037 | ) | $ | (76,625 | ) | |||||||||
Other comprehensive income (loss) before reclassifications | (126 | ) | — | (126 | ) | — | 467 | 341 | ||||||||||||||||
Amounts reclassified from accumulated other comprehensive income | 336 | — | 336 | 1,015 | — | 1,351 | ||||||||||||||||||
Net current period other comprehensive income (loss) before tax | 210 | — | 210 | 1,015 | 467 | 1,692 | ||||||||||||||||||
Deferred taxes on current period activity | 78 | — | 78 | 342 | — | 420 | ||||||||||||||||||
Net current period other comprehensive income (loss) after tax | 132 | — | 132 | 673 | 467 | 1,272 | ||||||||||||||||||
Balance at September 30, 2016 | $ | 1,090 | $ | — | $ | 1,090 | $ | (73,873 | ) | $ | (2,570 | ) | $ | (75,353 | ) | |||||||||
Balance at December 31, 2016 | $ | 1,837 | $ | — | $ | 1,837 | $ | (82,358 | ) | $ | (5,660 | ) | $ | (86,181 | ) | |||||||||
Other comprehensive income (loss) before reclassifications | (1,205 | ) | 30 | (1,175 | ) | — | 1,649 | 474 | ||||||||||||||||
Amounts reclassified from accumulated other comprehensive income | 219 | (182 | ) | 37 | 3,655 | — | 3,692 | |||||||||||||||||
Net current period other comprehensive income (loss) before tax | (986 | ) | (152 | ) | (1,138 | ) | 3,655 | 1,649 | 4,166 | |||||||||||||||
Deferred taxes on current period activity | (326 | ) | (57 | ) | (383 | ) | 1,258 | — | 875 | |||||||||||||||
Net current period other comprehensive income (loss) after tax | (660 | ) | (95 | ) | (755 | ) | 2,397 | 1,649 | 3,291 | |||||||||||||||
Balance at September 29, 2017 | $ | 1,177 | $ | (95 | ) | $ | 1,082 | $ | (79,961 | ) | $ | (4,011 | ) | $ | (82,890 | ) | ||||||||
Balance at December 31, 2015 | $ | 1,579 | $ | — | $ | 1,579 | $ | (76,796 | ) | $ | (5,488 | ) | $ | (80,705 | ) | |||||||||
Other comprehensive income (loss) before reclassifications | (1,571 | ) | — | (1,571 | ) | — | 2,918 | 1,347 | ||||||||||||||||
Amounts reclassified from accumulated other comprehensive income | 793 | — | 793 | 3,045 | — | 3,838 | ||||||||||||||||||
Net current period other comprehensive income (loss) before tax | (778 | ) | — | (778 | ) | 3,045 | 2,918 | 5,185 | ||||||||||||||||
Deferred taxes on current period activity | (289 | ) | — | (289 | ) | 122 | — | (167 | ) | |||||||||||||||
Net current period other comprehensive income (loss) after tax | (489 | ) | — | (489 | ) | 2,923 | 2,918 | 5,352 | ||||||||||||||||
Balance at September 30, 2016 | $ | 1,090 | $ | — | $ | 1,090 | $ | (73,873 | ) | $ | (2,570 | ) | $ | (75,353 | ) |
Gains and Losses on Cash Flow Hedges | ||||||||||||||||||||||||||||||||||||||||||||||||||
(Thousands) | Foreign Currency | Interest Rate | Precious Metals | Copper | Total | Pension and Post-Employment Benefits | Foreign Currency Translation | Total | ||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | $ | 2,348 | $ | — | $ | 72 | $ | — | $ | 2,420 | $ | (39,702) | $ | (2,887) | $ | (40,169) | ||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) before reclassifications | 2,107 | 8,228 | 388 | — | 10,723 | — | (14,484) | (3,761) | ||||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (170) | 238 | (27) | — | 41 | (1,028) | — | (987) | ||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive (loss) income before tax | 1,937 | 8,466 | 361 | — | 10,764 | (1,028) | (14,484) | (4,748) | ||||||||||||||||||||||||||||||||||||||||||
Deferred taxes | 446 | 1,947 | 82 | — | 2,475 | (812) | — | 1,663 | ||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive (loss) income after tax | 1,491 | 6,519 | 279 | — | 8,289 | (216) | (14,484) | (6,411) | ||||||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | $ | 3,839 | $ | 6,519 | $ | 351 | $ | — | $ | 10,709 | $ | (39,918) | $ | (17,371) | $ | (46,580) | ||||||||||||||||||||||||||||||||||
Balance at December 31, 2020 | $ | 519 | $ | — | $ | (170) | $ | 468 | $ | 817 | $ | (43,473) | $ | 4,017 | $ | (38,639) | ||||||||||||||||||||||||||||||||||
Other comprehensive (loss) income before reclassifications | 1,893 | — | 532 | 2,444 | 4,869 | — | (7,693) | (2,824) | ||||||||||||||||||||||||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 138 | — | (122) | (3,049) | (3,033) | 348 | — | (2,685) | ||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive (loss) income before tax | 2,031 | — | 410 | (605) | 1,836 | 348 | (7,693) | (5,509) | ||||||||||||||||||||||||||||||||||||||||||
Deferred taxes | 467 | — | 95 | (137) | 425 | (20) | — | 405 | ||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive (loss) income after tax | 1,564 | — | 315 | (468) | 1,411 | 368 | (7,693) | (5,914) | ||||||||||||||||||||||||||||||||||||||||||
Balance at October 1, 2021 | $ | 2,083 | $ | — | $ | 145 | $ | — | $ | 2,228 | $ | (43,105) | $ | (3,676) | $ | (44,553) |
Risk-free interest rate | % | ||||||||
Dividend yield | % | ||||||||
Volatility | % | ||||||||
Expected term (in years) | 4.4 |
(Thousands) | Total Carrying Value in the Consolidated Balance Sheets | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | (Thousands) | Total Carrying Value in the Consolidated Balance Sheets | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Assets | Financial Assets | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred compensation investments | $ | 2,149 | $ | 1,734 | $ | 2,149 | $ | 1,734 | $ | — | $ | — | $ | — | $ | — | Deferred compensation investments | $ | 2,754 | $ | 4,426 | $ | 2,754 | $ | 4,426 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency forward contracts | 149 | 691 | — | — | 149 | 691 | — | — | Foreign currency forward contracts | 3,796 | 3,368 | — | — | 3,796 | 3,368 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest rate swap | Interest rate swap | 8,467 | — | — | — | 8,467 | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Precious metal swaps | 45 | — | — | — | 45 | — | — | — | Precious metal swaps | 476 | 116 | — | — | 476 | 116 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 2,343 | $ | 2,425 | $ | 2,149 | $ | 1,734 | $ | 194 | $ | 691 | $ | — | $ | — | Total | $ | 15,493 | $ | 7,910 | $ | 2,754 | $ | 4,426 | $ | 12,739 | $ | 3,484 | $ | — | $ | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Financial Liabilities | Financial Liabilities | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred compensation liability | $ | 2,149 | $ | 1,734 | $ | 2,149 | $ | 1,734 | $ | — | $ | — | $ | — | $ | — | Deferred compensation liability | $ | 2,754 | $ | 4,426 | $ | 2,754 | $ | 4,426 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency forward contracts | 669 | 1 | — | — | 669 | 1 | — | — | Foreign currency forward contracts | 736 | 136 | — | — | 736 | 136 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Precious metal swaps | 197 | — | — | — | 197 | — | — | — | Precious metal swaps | 23 | 24 | — | — | 23 | 24 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 3,015 | $ | 1,735 | $ | 2,149 | $ | 1,734 | $ | 866 | $ | 1 | $ | — | $ | — | Total | $ | 3,513 | $ | 4,586 | $ | 2,754 | $ | 4,426 | $ | 759 | $ | 160 | $ | — | $ | — |
September 29, 2017 | December 31, 2016 | September 30, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||||||||||||
(Thousands) | Notional Amount | Fair Value | Notional Amount | Fair Value | (Thousands) | Notional Amount | Fair Value | Notional Amount | Fair Value | |||||||||||||||||||||||||||||||||
Foreign currency forward contracts | Foreign currency forward contracts | |||||||||||||||||||||||||||||||||||||||||
Prepaid and other current assets | Prepaid and other current assets | $ | 14,216 | $ | 619 | $ | 55,063 | $ | 2,132 | |||||||||||||||||||||||||||||||||
Other liabilities and accrued items | Other liabilities and accrued items | 16,144 | 722 | 9,425 | 128 | |||||||||||||||||||||||||||||||||||||
Foreign currency forward contracts - euro | $ | 14,402 | $ | (11 | ) | $ | — | $ | — | |||||||||||||||||||||||||||||||||
Total | $ | 14,402 | $ | (11 | ) | $ | — | $ | — |
September 30, 2022 | ||||||||||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||||||||||
(Thousands) | Notional Amount | Prepaid and other current assets | Other assets | Other liabilities and accrued items | Other long-term liabilities | |||||||||||||||||||||||||||
Foreign currency forward contracts - yen | $ | 3,301 | $ | 460 | $ | 35 | $ | 14 | $ | — | ||||||||||||||||||||||
Foreign currency forward contracts - euro | 27,030 | 2,494 | 188 | — | — | |||||||||||||||||||||||||||
Precious metal swaps | 5,227 | 476 | — | 9 | 14 | |||||||||||||||||||||||||||
Interest rate swap | 100,000 | 2,798 | 5,669 | — | — | |||||||||||||||||||||||||||
Total | $ | 135,558 | $ | 6,228 | $ | 5,892 | $ | 23 | $ | 14 | ||||||||||||||||||||||
December 31, 2021 | ||||||||||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||||||||||
Notional Amount | Prepaid and other current assets | Other assets | Other liabilities and accrued items | Other long-term liabilities | ||||||||||||||||||||||||||||
Foreign currency forward contracts - yen | $ | 3,907 | $ | 131 | $ | 2 | $ | — | $ | — | ||||||||||||||||||||||
Foreign currency forward contracts - euro | 28,412 | 1,102 | — | — | 8 | |||||||||||||||||||||||||||
Precious metal swaps | 6,256 | 116 | — | 24 | — | |||||||||||||||||||||||||||
Total | $ | 38,575 | $ | 1,349 | $ | 2 | $ | 24 | $ | 8 |
September 29, 2017 | December 31, 2016 | |||||||||||||||
(Thousands) | Notional Amount | Fair Value | Notional Amount | Fair Value | ||||||||||||
Prepaid expenses | ||||||||||||||||
Foreign currency forward contracts - yen | $ | 2,000 | $ | 59 | $ | 2,418 | $ | 239 | ||||||||
Foreign currency forward contracts - euro | 6,829 | 90 | 6,493 | 452 | ||||||||||||
Precious metal swaps | 2,148 | 13 | — | — | ||||||||||||
Total | 10,977 | 162 | 8,911 | 691 | ||||||||||||
Other assets | ||||||||||||||||
Precious metal swaps | 1,932 | 32 | — | — | ||||||||||||
Total | 1,932 | 32 | — | — | ||||||||||||
Other liabilities and accrued items | ||||||||||||||||
Foreign currency forward contracts - euro | 12,689 | (658 | ) | 537 | (1 | ) | ||||||||||
Precious metal swaps | 7,845 | (170 | ) | — | — | |||||||||||
Total | 20,534 | (828 | ) | 537 | (1 | ) | ||||||||||
Other long-term liabilities | ||||||||||||||||
Precious metal swaps | 1,999 | (27 | ) | — | — | |||||||||||
Total | $ | 35,442 | $ | (661 | ) | $ | 9,448 | $ | 690 |
Third Quarter Ended | ||||||||||||||||||||
(Thousands) | September 30, 2022 | October 1, 2021 | ||||||||||||||||||
Hedging relationship | Line item | |||||||||||||||||||
Foreign currency forward contracts | Net sales | $ | (41) | $ | (2) | |||||||||||||||
Precious metal swaps | Cost of sales | (126) | (83) | |||||||||||||||||
Interest rate swap | Interest expense - net | (115) | — | |||||||||||||||||
Copper swaps | Cost of sales | — | (8) | |||||||||||||||||
Total | $ | (282) | $ | (93) |
Nine Months Ended | ||||||||||||||||||||
(Thousands) | September 30, 2022 | October 1, 2021 | ||||||||||||||||||
Hedging relationship | Line item | |||||||||||||||||||
Foreign currency forward contracts | Net sales | $ | (171) | $ | 138 | |||||||||||||||
Precious metal swaps | Cost of sales | (27) | (122) | |||||||||||||||||
Interest rate swap | Interest expense - net | 238 | — | |||||||||||||||||
Copper swaps | Cost of sales | — | (3,049) | |||||||||||||||||
Total | $ | 40 | $ | (3,033) |
(Thousands) | September 30, 2022 | December 31, 2021 | ||||||||||||
Borrowings under Credit Agreement | $ | 201,388 | $ | 152,296 | ||||||||||
Borrowings under the Term Loan Facility | 288,750 | 300,000 | ||||||||||||
Foreign debt | 7,947 | 2,252 | ||||||||||||
Total debt outstanding | 498,085 | 454,548 | ||||||||||||
Current portion of long-term debt | (19,747) | (15,359) | ||||||||||||
Gross long-term debt | 478,338 | 439,189 | ||||||||||||
Unamortized deferred financing fees | (4,058) | (4,801) | ||||||||||||
Long-term debt | $ | 474,280 | $ | 434,388 | ||||||||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Third Quarter Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, | October 1, | $ | % | |||||||||||||||||||||||||||||||||||||||||||||||
(Thousands, except per share data) | 2022 | 2021 | Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 428,191 | $ | 388,028 | $ | 40,163 | 10 | % | ||||||||||||||||||||||||||||||||||||||||||
Value-added sales | 290,426 | 215,826 | 74,600 | 35 | % | |||||||||||||||||||||||||||||||||||||||||||||
Gross margin | 82,743 | 74,313 | 8,430 | 11 | % | |||||||||||||||||||||||||||||||||||||||||||||
Gross margin as a % of value-added sales | 28 | % | 34 | % | ||||||||||||||||||||||||||||||||||||||||||||||
Selling, general, and administrative (SG&A) expense | 38,958 | 43,195 | (4,237) | (10) | % | |||||||||||||||||||||||||||||||||||||||||||||
SG&A expense as a % of value-added sales | 13 | % | 20 | % | ||||||||||||||||||||||||||||||||||||||||||||||
Research and development (R&D) expense | 7,430 | 6,354 | 1,076 | 17 | % | |||||||||||||||||||||||||||||||||||||||||||||
R&D expense as a % of value-added sales | 3 | % | 3 | % | ||||||||||||||||||||||||||||||||||||||||||||||
Restructuring expense | 484 | — | 484 | — | % | |||||||||||||||||||||||||||||||||||||||||||||
Other—net | 6,774 | 3,604 | 3,170 | 88 | % | |||||||||||||||||||||||||||||||||||||||||||||
Operating profit | 29,097 | 21,160 | 7,937 | 38 | % | |||||||||||||||||||||||||||||||||||||||||||||
Other non-operating (income)—net | (1,175) | (1,279) | 104 | (8) | % | |||||||||||||||||||||||||||||||||||||||||||||
Interest expense—net | 5,888 | 861 | 5,027 | 584 | % | |||||||||||||||||||||||||||||||||||||||||||||
Income before income taxes | 24,384 | 21,578 | 2,806 | 13 | % | |||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | 4,432 | 3,422 | 1,010 | 30 | % | |||||||||||||||||||||||||||||||||||||||||||||
Net income | $ | 19,952 | $ | 18,156 | $ | 1,796 | 10 | % | ||||||||||||||||||||||||||||||||||||||||||
Diluted earnings per share | $ | 0.96 | $ | 0.88 | $ | 0.08 | 9 | % |
Third Quarter Ended | |||||||||||||||
Sept. 29, | Sept. 30, | $ | % | ||||||||||||
(Thousands, except per share data) | 2017 | 2016 | Change | Change | |||||||||||
Net sales | $ | 294,268 | $ | 249,619 | $ | 44,649 | 18 | % | |||||||
Value-added sales | 171,382 | 157,001 | 14,381 | 9 | % | ||||||||||
Gross margin | 55,203 | 50,755 | 4,448 | 9 | % | ||||||||||
Gross margin as a % of value-added sales | 32 | % | 32 | % | N/A | N/A | |||||||||
Selling, general, and administrative (SG&A) expense | 36,415 | 34,177 | 2,238 | 7 | % | ||||||||||
SG&A expense as a % of value-added sales | 21 | % | 22 | % | N/A | N/A | |||||||||
Research and development (R&D) expense | 3,429 | 3,237 | 192 | 6 | % | ||||||||||
R&D expense as a % of value-added sales | 2 | % | 2 | % | N/A | N/A | |||||||||
Other—net | 3,801 | 3,190 | 611 | 19 | % | ||||||||||
Operating profit | 11,558 | 10,151 | 1,407 | 14 | % | ||||||||||
Interest expense—net | 533 | 490 | 43 | 9 | % | ||||||||||
Income before income taxes | 11,025 | 9,661 | 1,364 | 14 | % | ||||||||||
Income tax expense | 1,705 | 1,616 | 89 | 6 | % | ||||||||||
Net income | $ | 9,320 | $ | 8,045 | $ | 1,275 | 16 | % | |||||||
Diluted earnings per share | $ | 0.46 | $ | 0.40 | $ | 0.06 | 15 | % |
Nine Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, | October 1, | $ | % | |||||||||||||||||||||||||||||||||||||||||||||||
(Thousands, except per share data) | 2022 | 2021 | Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 1,322,531 | $ | 1,113,413 | $ | 209,118 | 19 | % | ||||||||||||||||||||||||||||||||||||||||||
Value-added sales | 834,420 | 622,295 | 212,125 | 34 | % | |||||||||||||||||||||||||||||||||||||||||||||
Gross margin | 245,461 | 210,690 | 34,771 | 17 | % | |||||||||||||||||||||||||||||||||||||||||||||
Gross margin as a % of value-added sales | 29 | % | 34 | % | ||||||||||||||||||||||||||||||||||||||||||||||
SG&A expense | 122,666 | 118,031 | 4,635 | 4 | % | |||||||||||||||||||||||||||||||||||||||||||||
SG&A expense as a % of value-added sales | 15 | % | 19 | % | ||||||||||||||||||||||||||||||||||||||||||||||
R&D expense | 22,096 | 19,164 | 2,932 | 15 | % | |||||||||||||||||||||||||||||||||||||||||||||
R&D expense as a % of value-added sales | 3 | % | 3 | % | ||||||||||||||||||||||||||||||||||||||||||||||
Restructuring (income) expense | 1,560 | (378) | 1,938 | (513) | % | |||||||||||||||||||||||||||||||||||||||||||||
Other—net | 18,575 | 12,272 | 6,303 | 51 | % | |||||||||||||||||||||||||||||||||||||||||||||
Operating profit | 80,564 | 61,601 | 18,963 | 31 | % | |||||||||||||||||||||||||||||||||||||||||||||
Other non-operating (income)—net | (3,512) | (3,832) | 320 | (8) | % | |||||||||||||||||||||||||||||||||||||||||||||
Interest expense—net | 14,325 | 2,480 | 11,845 | 478 | % | |||||||||||||||||||||||||||||||||||||||||||||
Income before income taxes | 69,751 | 62,953 | 6,798 | 11 | % | |||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | 12,525 | 10,162 | 2,363 | 23 | % | |||||||||||||||||||||||||||||||||||||||||||||
Net income | $ | 57,226 | $ | 52,791 | $ | 4,435 | 8 | % | ||||||||||||||||||||||||||||||||||||||||||
Diluted earnings per share | $ | 2.76 | $ | 2.56 | $ | 0.20 | 8 | % |
Nine Months Ended | |||||||||||||||
Sept. 29, | Sept. 30, | $ | % | ||||||||||||
(Thousands, except per share data) | 2017 | 2016 | Change | Change | |||||||||||
Net sales | $ | 830,779 | $ | 734,906 | $ | 95,873 | 13 | % | |||||||
Value-added sales | 496,462 | 454,793 | 41,669 | 9 | % | ||||||||||
Gross margin | 152,756 | 139,418 | 13,338 | 10 | % | ||||||||||
Gross margin as a % of value-added sales | 31 | % | 31 | % | N/A | N/A | |||||||||
SG&A expense | 108,118 | 97,101 | 11,017 | 11 | % | ||||||||||
SG&A expense as a % of value-added sales | 22 | % | 21 | % | N/A | N/A | |||||||||
R&D expense | 10,103 | 9,860 | 243 | 2 | % | ||||||||||
R&D expense as a % of value-added sales | 2 | % | 2 | % | N/A | N/A | |||||||||
Other—net | 9,823 | 8,997 | 826 | 9 | % | ||||||||||
Operating profit | 24,712 | 23,460 | 1,252 | 5 | % | ||||||||||
Interest expense—net | 1,721 | 1,417 | 304 | 21 | % | ||||||||||
Income before income taxes | 22,991 | 22,043 | 948 | 4 | % | ||||||||||
Income tax expense | 3,308 | 3,081 | 227 | 7 | % | ||||||||||
Net income | $ | 19,683 | $ | 18,962 | $ | 721 | 4 | % | |||||||
Diluted earnings per share | $ | 0.97 | $ | 0.94 | $ | 0.03 | 3 | % |
Third Quarter Ended | Nine Months Ended | |||||||||||||||
Sept. 29, | Sept. 30, | Sept. 29, | Sept. 30, | |||||||||||||
(Thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Net sales | ||||||||||||||||
Performance Alloys and Composites | $ | 109,393 | $ | 103,699 | $ | 310,487 | $ | 292,024 | ||||||||
Advanced Materials | 157,770 | 107,250 | 429,550 | 328,927 | ||||||||||||
Precision Coatings | 27,105 | 38,670 | 90,742 | 113,955 | ||||||||||||
Other | — | — | — | — | ||||||||||||
Total | $ | 294,268 | $ | 249,619 | $ | 830,779 | $ | 734,906 | ||||||||
Less: pass-through metal costs | ||||||||||||||||
Performance Alloys and Composites | $ | 18,756 | $ | 16,452 | $ | 47,953 | $ | 43,225 | ||||||||
Advanced Materials | 97,379 | 61,290 | 259,830 | 193,908 | ||||||||||||
Precision Coatings | 5,209 | 12,867 | 22,932 | 38,407 | ||||||||||||
Other | 1,542 | 2,009 | 3,602 | 4,573 | ||||||||||||
Total | $ | 122,886 | $ | 92,618 | $ | 334,317 | $ | 280,113 | ||||||||
Value-added sales | ||||||||||||||||
Performance Alloys and Composites | $ | 90,637 | $ | 87,247 | $ | 262,534 | $ | 248,799 | ||||||||
Advanced Materials | 60,391 | 45,960 | 169,720 | 135,019 | ||||||||||||
Precision Coatings | 21,896 | 25,803 | 67,810 | 75,548 | ||||||||||||
Other | (1,542 | ) | (2,009 | ) | (3,602 | ) | (4,573 | ) | ||||||||
Total | $ | 171,382 | $ | 157,001 | $ | 496,462 | $ | 454,793 |
Third Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | October 1, | September 30, | October 1, | |||||||||||||||||||||||
(Thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Net sales | ||||||||||||||||||||||||||
Performance Materials | $ | 169,357 | $ | 136,096 | $ | 473,876 | $ | 375,533 | ||||||||||||||||||
Electronic Materials | 230,841 | 220,723 | 762,649 | 638,481 | ||||||||||||||||||||||
Precision Optics | 27,993 | 31,209 | 86,006 | 99,399 | ||||||||||||||||||||||
Other | — | — | — | — | ||||||||||||||||||||||
Total | $ | 428,191 | $ | 388,028 | $ | 1,322,531 | $ | 1,113,413 | ||||||||||||||||||
Less: pass-through metal costs | ||||||||||||||||||||||||||
Performance Materials | $ | 20,525 | $ | 20,929 | $ | 61,959 | $ | 50,936 | ||||||||||||||||||
Electronic Materials | 116,977 | 151,019 | 424,716 | 438,928 | ||||||||||||||||||||||
Precision Optics | 16 | — | 83 | 43 | ||||||||||||||||||||||
Other | 248 | 254 | 1,353 | 1,211 | ||||||||||||||||||||||
Total | $ | 137,766 | $ | 172,202 | $ | 488,111 | $ | 491,118 | ||||||||||||||||||
Value-added sales | ||||||||||||||||||||||||||
Performance Materials | $ | 148,832 | $ | 115,167 | $ | 411,917 | $ | 324,597 | ||||||||||||||||||
Electronic Materials | 113,864 | 69,704 | 337,933 | 199,553 | ||||||||||||||||||||||
Precision Optics | 27,977 | 31,209 | 85,923 | 99,356 | ||||||||||||||||||||||
Other | (248) | (254) | (1,353) | (1,211) | ||||||||||||||||||||||
Total | $ | 290,425 | $ | 215,826 | $ | 834,420 | $ | 622,295 |
Third Quarter Ended | Third Quarter Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Sept. 29, | Sept. 30, | $ | % | September 30, | October 1, | $ | % | ||||||||||||||||||||||||||||||||||||||||||||||
(Thousands) | 2017 | 2016 | Change | Change | (Thousands) | 2022 | 2021 | Change | Change | ||||||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 109,393 | $ | 103,699 | $ | 5,694 | 5 | % | Net sales | $ | 169,357 | $ | 136,096 | $ | 33,261 | 24 | % | ||||||||||||||||||||||||||||||||||||
Value-added sales | 90,637 | 87,247 | 3,390 | 4 | % | Value-added sales | $ | 148,832 | $ | 115,167 | 33,665 | 29 | % | ||||||||||||||||||||||||||||||||||||||||
Operating profit | 6,786 | 4,357 | 2,429 | 56 | % | ||||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | EBITDA | $ | 28,866 | $ | 28,917 | (51) | — | % |
Nine Months Ended | ||||||||||||||||||||||||||||||||||||||
September 30, | October 1, | $ | % | |||||||||||||||||||||||||||||||||||
(Thousands) | 2022 | 2021 | Change | Change | ||||||||||||||||||||||||||||||||||
Net sales | $ | 473,876 | $ | 375,533 | $ | 98,343 | 26 | % | ||||||||||||||||||||||||||||||
Value-added sales | $ | 411,917 | $ | 324,597 | 87,320 | 27 | % | |||||||||||||||||||||||||||||||
EBITDA | $ | 80,886 | $ | 68,027 | 12,859 | 19 | % |
Third Quarter Ended | ||||||||||||||||||||||||||||||||||||||
September 30, | October 1, | $ | % | |||||||||||||||||||||||||||||||||||
(Thousands) | 2022 | 2021 | Change | Change | ||||||||||||||||||||||||||||||||||
Net sales | 230,841 | 220,723 | 10,118 | 5 | % | |||||||||||||||||||||||||||||||||
Value-added sales | 113,864 | 69,704 | 44,160 | 63 | % | |||||||||||||||||||||||||||||||||
EBITDA | 16,853 | 11,326 | 5,527 | 49 | % |
Nine Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Sept. 29, | Sept. 30, | $ | % | September 30, | October 1, | $ | % | ||||||||||||||||||||||||||||||||||||||||||||||
(Thousands) | 2017 | 2016 | Change | Change | (Thousands) | 2022 | 2021 | Change | Change | ||||||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 310,487 | $ | 292,024 | $ | 18,463 | 6 | % | Net sales | 762,649 | 638,481 | 124,168 | 19 | % | |||||||||||||||||||||||||||||||||||||||
Value-added sales | 262,534 | 248,799 | 13,735 | 6 | % | Value-added sales | 337,933 | 199,553 | 138,380 | 69 | % | ||||||||||||||||||||||||||||||||||||||||||
Operating profit | 12,523 | 6,103 | 6,420 | 105 | % | ||||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | EBITDA | 51,338 | 32,668 | 18,670 | 57 | % |
Third Quarter Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Sept. 29, | Sept. 30, | $ | % | |||||||||||||||||||||||||||||||||||||||||||||||||
(Thousands) | (Thousands) | Third Quarter Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, | October 1, | $ | % | |||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 2016 | Change | Change | 2022 | 2021 | Change | Change | |||||||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 157,770 | $ | 107,250 | 50,520 | 47 | % | Net sales | 27,993 | 31,209 | (3,216) | (10) | % | |||||||||||||||||||||||||||||||||||||||
Value-added sales | 60,391 | 45,960 | 14,431 | 31 | % | Value-added sales | 27,977 | 31,209 | (3,232) | (10) | % | |||||||||||||||||||||||||||||||||||||||||
Operating profit | 9,756 | 8,245 | 1,511 | 18 | % | |||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | EBITDA | 3,546 | 6,228 | (2,682) | (43) | % |
Nine Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Sept. 29, | Sept. 30, | $ | % | |||||||||||||||||||||||||||||||||||||||||||||||||
(Thousands) | (Thousands) | Nine Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, | October 1, | $ | % | |||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 2016 | Change | Change | 2022 | 2021 | Change | Change | |||||||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 429,550 | $ | 328,927 | 100,623 | 31 | % | Net sales | 86,006 | 99,399 | (13,393) | (13) | % | |||||||||||||||||||||||||||||||||||||||
Value-added sales | 169,720 | 135,019 | 34,701 | 26 | % | Value-added sales | 85,923 | 99,356 | (13,433) | (14) | % | |||||||||||||||||||||||||||||||||||||||||
Operating profit | 24,873 | 20,748 | 4,125 | 20 | % | |||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | EBITDA | 9,281 | 19,246 | (9,965) | (52) | % |
(Thousands) | Third Quarter Ended | |||||||||||||
Sept. 29, | Sept. 30, | $ | % | |||||||||||
2017 | 2016 | Change | Change | |||||||||||
Net sales | $ | 27,105 | $ | 38,670 | (11,565 | ) | (30 | )% | ||||||
Value-added sales | 21,896 | 25,803 | (3,907 | ) | (15 | )% | ||||||||
Operating profit | 1,613 | 3,432 | (1,819 | ) | (53 | )% |
(Thousands) | Nine Months Ended | |||||||||||||
Sept. 29, | Sept. 30, | $ | % | |||||||||||
2017 | 2016 | Change | Change | |||||||||||
Net sales | $ | 90,742 | $ | 113,955 | (23,213 | ) | (20 | )% | ||||||
Value-added sales | 67,810 | 75,548 | (7,738 | ) | (10 | )% | ||||||||
Operating profit | 6,145 | 9,803 | (3,658 | ) | (37 | )% |
(Thousands) | Third Quarter Ended | (Thousands) | Third Quarter Ended | |||||||||||||||||||||||||||||||||||||
Sept. 29, | Sept. 30, | $ | % | September 30, | October 1, | $ | % | |||||||||||||||||||||||||||||||||
2017 | 2016 | Change | Change | 2022 | 2021 | Change | Change | |||||||||||||||||||||||||||||||||
Net sales | $ | — | $ | — | — | — | % | Net sales | $ | — | $ | — | — | — | % | |||||||||||||||||||||||||
Value-added sales | (1,542 | ) | (2,009 | ) | 467 | (23 | )% | Value-added sales | (248) | (254) | 6 | (2) | % | |||||||||||||||||||||||||||
Operating loss | (6,597 | ) | (5,883 | ) | (714 | ) | 12 | % | ||||||||||||||||||||||||||||||||
EBITDA | EBITDA | (5,839) | (10,617) | 4,778 | (45) | % |
(Thousands) | Nine Months Ended | (Thousands) | Nine Months Ended | |||||||||||||||||||||||||||||||||||||
Sept. 29, | Sept. 30, | $ | % | September 30, | October 1, | $ | % | |||||||||||||||||||||||||||||||||
2017 | 2016 | Change | Change | 2022 | 2021 | Change | Change | |||||||||||||||||||||||||||||||||
Net sales | $ | — | $ | — | — | — | % | Net sales | $ | — | $ | — | — | — | % | |||||||||||||||||||||||||
Value-added sales | (3,602 | ) | (4,573 | ) | 971 | (21 | )% | Value-added sales | (1,353) | (1,211) | (142) | 12 | % | |||||||||||||||||||||||||||
Operating loss | (18,829 | ) | (13,194 | ) | (5,635 | ) | 43 | % | ||||||||||||||||||||||||||||||||
EBITDA | EBITDA | (18,206) | (22,030) | 3,824 | (17) | % |
Nine Months Ended | ||||||||||||||||||||||||||||||||
September 30, | October 1, | $ | ||||||||||||||||||||||||||||||
(Thousands) | 2022 | 2021 | Change | |||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | 34,204 | $ | 40,518 | $ | (6,314) | ||||||||||||||||||||||||||
Net cash used in investing activities | (56,380) | (76,954) | 20,574 | |||||||||||||||||||||||||||||
Net cash provided by financing activities | 31,349 | 28,779 | 2,570 | |||||||||||||||||||||||||||||
Effects of exchange rate changes | (2,953) | (212) | (2,741) | |||||||||||||||||||||||||||||
Net change in cash and cash equivalents | $ | 6,220 | $ | (7,869) | $ | 14,089 |
Nine Months Ended | ||||||||||||
Sept. 29, | Sept. 30, | $ | ||||||||||
(Thousands) | 2017 | 2016 | Change | |||||||||
Net cash provided by operating activities | $ | 35,497 | $ | 27,222 | $ | 8,275 | ||||||
Net cash used in investing activities | (34,830 | ) | (27,620 | ) | (7,210 | ) | ||||||
Net cash used in financing activities | (10,938 | ) | (8,556 | ) | (2,382 | ) | ||||||
Effects of exchange rate changes | 1,293 | 524 | 769 | |||||||||
Net change in cash and cash equivalents | $ | (8,978 | ) | $ | (8,430 | ) | $ | (548 | ) |
September 30, | December 31, | |||||||||||||
(Thousands) | 2022 | 2021 | ||||||||||||
Cash and cash equivalents | $ | 20,682 | $ | 14,462 | ||||||||||
Total outstanding debt | 494,027 | 449,474 | ||||||||||||
Net debt | $ | (473,345) | $ | (435,012) | ||||||||||
Available borrowing capacity | $ | 127,169 | $ | 176,419 |
September 29, | December 31, | |||||||
(Thousands) | 2017 | 2016 | ||||||
Total outstanding debt | $ | 4,007 | $ | 4,615 | ||||
Cash | 22,486 | 31,464 | ||||||
Net debt (cash) | (18,479 | ) | (26,849 | ) | ||||
Available borrowing capacity | $ | 266,405 | $ | 238,886 | ||||
Debt-to-debt-plus-equity ratio | 1 | % | 1 | % |
Item 3. | Quantitative and Qualitative Disclosures about Market Risk |
Item 4. | Controls and Procedures |
Item 1. | Legal Proceedings |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | Total Number of Shares Purchased (1) | Average Price Paid per Share (1) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) | ||||||||||
July 1 through August 4, 2017 | 895 | $ | 38.42 | — | $ | 15,703,744 | ||||||||
August 5 through September 1, 2017 | 401 | 38.16 | — | 15,703,744 | ||||||||||
September 1 through September 29, 2017 | 1,062 | 42.88 | — | 15,703,744 | ||||||||||
Total | 2,358 | $ | 40.38 | — | $ | 15,703,744 |
Period | Total Number of Shares Purchased (1) | Average Price Paid per Share (1) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) | ||||||||||||||||||||||
July 2 through August 5, 2022 | — | $ | — | — | $ | 8,316,239 | ||||||||||||||||||||
August 6 through September 2, 2022 | 2,523 | 96.79 | — | 8,316,239 | ||||||||||||||||||||||
September 3 through September 30, 2022 | — | — | — | 8,316,239 | ||||||||||||||||||||||
Total | 2,523 | $ | 96.79 | — | $ | 8,316,239 |
(1) | ||||||||
(2) | On January 14, 2014, |
Item 4. | Mine Safety Disclosures |
Exhibits |
31.1 | Certification of Chief Executive Officer required by Rule 13a-14(a) or 15d-14(a)* | |||||||
31.2 | Certification of Chief Financial Officer required by Rule 13a-14(a) or 15d-14(a)* | |||||||
32 | Certifications of Chief Executive Officer and Chief Financial Officer required by 18 U.S.C. Section 1350* | |||||||
Amended and Restated Metals Consignment Agreement, dated as of August 12, 2022 (filed as Exhibit 10.1 to the Company's 8-K filed on August 15, 2022), incorporated herein by reference. | ||||||||
95 | Mine Safety Disclosure Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act for the period ended September | |||||||
101.INS | XBRL Instance | |||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document* | |||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document* | |||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document* | |||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document* | |||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document* | |||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in the Exhibit 101 attachments) |
MATERION CORPORATION | ||||||||||||||||
Dated: November 2, 2022 | ||||||||||||||||
/s/ | ||||||||||||||||
Vice President, Finance and Chief Financial Officer | ||||||||||||||||
(Principal Financial |