Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Mar. 27, 2015 | Apr. 29, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | TWIN DISC INC | |
Entity Central Index Key | 100378 | |
Current Fiscal Year End Date | -24 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 11,268,011 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q3 | |
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 27-Mar-15 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (USD $) | Mar. 27, 2015 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash | $23,607 | $24,757 |
Trade accounts receivable, net | 35,729 | 40,219 |
Inventories, net | 90,039 | 97,579 |
Deferred income taxes | 4,713 | 4,779 |
Other | 13,926 | 12,763 |
Total current assets | 168,014 | 180,097 |
Property, plant and equipment, net | 55,791 | 60,267 |
Goodwill, net | 12,818 | 13,463 |
Deferred income taxes | 1,340 | 2,556 |
Intangible assets, net | 2,264 | 2,797 |
Other assets | 6,149 | 7,805 |
Total assets | 246,376 | 266,985 |
Current liabilities: | ||
Short-term borrowings and current maturities of long-term debt | 3,571 | 3,604 |
Accounts payable | 24,859 | 22,111 |
Accrued liabilities | 29,152 | 31,265 |
Total current liabilities | 57,582 | 56,980 |
Long-term debt | 8,829 | 14,800 |
Accrued retirement benefits | 28,764 | 37,006 |
Deferred income taxes | 1,324 | 1,778 |
Other long-term liabilities | 3,050 | 4,110 |
Total liabilities | 99,549 | 114,674 |
Commitments and contingencies (Note D) | ||
Twin Disc shareholders' equity: | ||
Preferred shares authorized: 200,000; issued: none; no par value | 0 | 0 |
Common shares authorized: 30,000,000; issued: 13,099,468; no par value | 11,969 | 11,973 |
Retained earnings | 191,384 | 183,695 |
Accumulated other comprehensive loss | -29,074 | -15,943 |
Shareholders' equity before treasury stock | 174,279 | 179,725 |
Less treasury stock, at cost (1,831,457 and 1,837,595 shares, respectively) | 28,047 | 28,141 |
Total Twin Disc shareholders' equity | 146,232 | 151,584 |
Noncontrolling interest | 595 | 727 |
Total equity | 146,827 | 152,311 |
Total liabilities and equity | $246,376 | $266,985 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) (USD $) | Mar. 27, 2015 | Jun. 30, 2014 |
Twin Disc shareholders' equity: | ||
Preferred stock, shares authorized (in shares) | 200,000 | 200,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, no par value (in dollars per share) | $0 | $0 |
Common stock, shares authorized (in shares) | 30,000,000 | 30,000,000 |
Common stock, shares issued (in shares) | 13,099,468 | 13,099,468 |
Common stock, no par value (in dollars per share) | $0 | $0 |
Treasury stock, shares (in shares) | 1,831,457 | 1,837,595 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) [Abstract] | ||||
Net sales | $60,941 | $60,705 | $198,456 | $190,343 |
Cost of goods sold | 41,935 | 44,177 | 134,958 | 134,604 |
Gross profit | 19,006 | 16,528 | 63,498 | 55,739 |
Marketing, engineering and administrative expenses | 15,669 | 16,870 | 48,086 | 49,572 |
Restructuring of operations | 0 | 0 | 0 | 1,094 |
Earnings (loss) from operations | 3,337 | -342 | 15,412 | 5,073 |
Interest expense | 122 | 220 | 436 | 697 |
Other (income) expense, net | -539 | 68 | -1,021 | -85 |
Other income (expense), total | -417 | 288 | -585 | 612 |
Earnings (loss) before income taxes and noncontrolling interest | 3,754 | -630 | 15,997 | 4,461 |
Income taxes | 707 | -188 | 5,088 | 2,973 |
Net earnings (loss) | 3,047 | -442 | 10,909 | 1,488 |
Less: Net earnings attributable to noncontrolling interest, net of tax | -101 | -33 | -173 | -168 |
Net earnings (loss) attributable to Twin Disc | 2,946 | -475 | 10,736 | 1,320 |
Dividends per share (in dollars per share) | $0.09 | $0.09 | $0.27 | $0.27 |
Earnings (loss) per share data: | ||||
Basic earnings (loss) per share attributable to Twin Disc common shareholders (in dollars per share) | $0.26 | ($0.04) | $0.95 | $0.12 |
Diluted earnings (loss) per share attributable to Twin Disc common shareholders (in dollars per share) | $0.26 | ($0.04) | $0.95 | $0.12 |
Weighted average shares outstanding data: | ||||
Basic shares outstanding (in shares) | 11,277 | 11,265 | 11,276 | 11,256 |
Dilutive stock awards (in shares) | 2 | 0 | 4 | 6 |
Diluted shares outstanding (in shares) | 11,279 | 11,265 | 11,280 | 11,262 |
Comprehensive income: | ||||
Net earnings (loss) | 3,047 | -442 | 10,909 | 1,488 |
Benefit plan adjustments, net of income taxes of $322, $354, $917 and $1,060, respectively | 542 | 528 | 1,545 | 1,506 |
Foreign currency translation adjustment | -5,892 | 1,054 | -14,762 | 4,053 |
Comprehensive (loss) income | -2,303 | 1,140 | -2,308 | 7,047 |
Less: comprehensive income attributable to noncontrolling interest | -46 | -33 | -87 | -168 |
Comprehensive (loss) income attributable to Twin Disc | ($2,349) | $1,107 | ($2,395) | $6,879 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 |
Other comprehensive income, net: | ||||
Benefit plan adjustments, tax | $322 | $354 | $917 | $1,060 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Mar. 27, 2015 | Mar. 28, 2014 |
Cash flows from operating activities: | ||
Net earnings | $10,909 | $1,488 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 7,639 | 7,940 |
Restructuring of operations | 0 | 1,094 |
Other non-cash changes, net | 295 | 441 |
Net change in operating assets and liabilities | -3,343 | 6,824 |
Net cash provided by operating activities | 15,500 | 17,787 |
Cash flows from investing activities: | ||
Acquisitions of fixed assets | -5,898 | -5,183 |
Proceeds from sale of fixed assets | 210 | 121 |
Other, net | 1,553 | -244 |
Net cash used by investing activities | -4,135 | -5,306 |
Cash flows from financing activities: | ||
Payments of notes payable | -30 | -59 |
Borrowings under revolving loan agreement | 61,135 | 48,550 |
Repayments under revolving loan agreement | -67,100 | -50,600 |
Proceeds from exercise of stock options | 15 | 0 |
Dividends paid to shareholders | -3,047 | -3,045 |
Dividends paid to noncontrolling interest | -219 | -487 |
Excess tax (shortfall) benefits from stock compensation | -36 | 524 |
Payments of withholding taxes on stock compensation | -313 | -2,170 |
Net cash used by financing activities | -9,595 | -7,287 |
Effect of exchange rate changes on cash | -2,920 | 442 |
Net change in cash | -1,150 | 5,636 |
Cash: | ||
Beginning of period | 24,757 | 20,724 |
End of period | $23,607 | $26,360 |
Basis_of_Presentation
Basis of Presentation | 9 Months Ended | |
Mar. 27, 2015 | ||
Basis of Presentation [Abstract] | ||
Basis of Presentation | A. | Basis of Presentation |
The unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and, in the opinion of the Company, include all adjustments, consisting only of normal recurring items, necessary for a fair presentation of results for each period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such SEC rules and regulations. The Company believes that the disclosures made are adequate to make the information presented not misleading. It is suggested that these financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company's latest Annual Report. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. | ||
During the first quarter of fiscal 2014, the Company recorded out-of-period adjustments related to the correction of errors identified late in the year-end closing process of fiscal 2013 that were deemed immaterial for adjustment to the fiscal 2013 financial statements. The impact of these corrections to the fiscal 2014 first quarter was to increase earnings before income taxes and noncontrolling interest by $437,000 and increase net earnings attributable to Twin Disc by $69,000 (after considering applicable tax effects). The nature of these errors is as follows: | ||
· | The Company had over accrued for certain payroll related items totaling $337,000 as of June 30, 2013, resulting in an increase to earnings from operations in the first quarter of fiscal 2014. | |
· | The Company had overstated its warranty accrual by $217,000 as of June 30, 2013, resulting in an increase to earnings from operations in the first quarter of fiscal 2014. | |
· | The Company determined that work-in-process inventory had been overstated by $117,000 as of June 30, 2013. As a result, additional cost of goods sold was recorded in the first quarter of fiscal 2014, resulting in a decrease to earnings from operations in the first quarter of fiscal 2014. | |
· | The Company’s deferred tax liabilities were understated by $285,000 as of June 30, 2013, resulting in additional tax expense in the first quarter of fiscal 2014. | |
The Company does not believe these errors were material to its financial statements for any prior period, nor that the correction of these errors was material to the nine months ended March 28, 2014. | ||
During the third quarter of fiscal 2015, the Company recorded out-of-period adjustments for the correction of errors related to pension expense and tax expense, both of which were deemed immaterial for adjustment to prior period financial statements. More specifically, the nature of the errors is as follows: | ||
· | The Company overstated pension expense by $282,000 during the first six months of fiscal 2015 ($141,000 per quarter). | |
· | The Company understated tax expense by $175,000 for the year ended June 30, 2014. | |
The impact of the correction of these errors was to increase earnings before income taxes and noncontrolling interest by $282,000 and net earnings by $2,000, respectively, for the three-months ended March 27, 2015, and to decrease net earnings by $175,000 for the nine-months ended March 27, 2015. The Company does not believe these errors were material to its financial statements for any prior period, or that the correction of these errors is material to the quarter ended March 27, 2015 or its projected full year results for fiscal 2015. | ||
New Accounting Releases | ||
In April 2015, the Financial Accounting Standards Board (“FASB”) issued guidance intended to amend current presentation guidance by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. The amendments in this guidance are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015 (the Company’s fiscal 2017). The adoption of this guidance is not expected to have a material impact on the Company’s financial disclosures. | ||
In August 2014, the Financial Accounting Standards Board (“FASB”) issued updated guidance intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern. The amendments in this guidance are effective for fiscal years ending after December 15, 2016 (the Company’s fiscal 2017), and interim periods within fiscal years beginning after December 15, 2016. The adoption of this guidance is not expected to have a material impact on the Company’s financial disclosures. | ||
In June 2014, the FASB issued stock compensation guidance requiring that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. The amendments in this guidance are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015 (the Company’s fiscal 2017). The adoption of this guidance is not expected to have a material impact on the Company’s financial disclosures. | ||
In May 2014, the FASB issued updated guidance on revenue from contracts with customers. This revenue recognition guidance supersedes existing US GAAP guidance, including most industry-specific guidance. The core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance identifies steps to apply in achieving this principle. This updated guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016 (the Company’s fiscal 2018). The Company is currently evaluating the potential impact of this guidance on the Company’s financial disclosures and results. | ||
In April 2014, the FASB issued updated guidance on the reporting for discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. The new guidance also requires expanded financial disclosures about discontinued operations. The amendments in this updated guidance are effective for the first quarter of the Company’s fiscal 2016. The adoption of this guidance is not expected to have a material impact on the Company’s financial disclosures. | ||
In July 2013, the FASB issued guidance stating that, except in certain defined circumstances, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2013 (the Company’s fiscal 2015). The adoption of this guidance did not have a material impact on the Company’s financial disclosures. |
Inventory
Inventory | 9 Months Ended | ||
Mar. 27, 2015 | |||
Inventory [Abstract] | |||
Inventory | B. | Inventory | |
The major classes of inventories were as follows (in thousands): | |||
March 27, | June 30, | ||
2015 | 2014 | ||
Inventories: | |||
Finished parts | $60,692 | $66,418 | |
Work in process | 11,356 | 12,419 | |
Raw materials | 17,991 | 18,742 | |
$90,039 | $97,579 |
Warranty
Warranty | 9 Months Ended | ||||
Mar. 27, 2015 | |||||
Warranty [Abstract] | |||||
Warranty | C. | Warranty | |||
The Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its suppliers. However, its warranty obligation is affected by product failure rates, the number of units affected by the failure and the expense involved in satisfactorily addressing the situation. The warranty reserve is established based on our best estimate of the amounts necessary to settle future and existing claims on products sold as of the balance sheet date. When evaluating the adequacy of the reserve for warranty costs, management takes into consideration the term of the warranty coverage, historical claim rates and costs of repair, knowledge of the type and volume of new products and economic trends. While we believe the warranty reserve is adequate and that the judgment applied is appropriate, such amounts estimated to be due and payable in the future could differ materially from what actually transpires. The following is a listing of the activity in the warranty reserve during the three and nine month periods ended March 27, 2015 and March 28, 2014 (in thousands): | |||||
Three Months Ended | Nine Months Ended | ||||
Mar. 27, | Mar. 28, | Mar. 27, | Mar. 28, | ||
2015 | 2014 | 2015 | 2014 | ||
Reserve balance, beginning of period | $5,952 | $5,800 | $5,968 | $5,701 | |
Current period expense | 582 | 399 | 1,812 | 1,541 | |
Payments or credits to customers | -453 | -498 | -1,482 | -1,646 | |
Translation | -185 | 11 | -402 | 116 | |
Reserve balance, end of period | $5,896 | $5,712 | $5,896 | $5,712 | |
The current portion of the warranty accrual ($3,904,000 and $3,766,000 for March 27, 2015 and March 28, 2014, respectively) is reflected in accrued liabilities, while the long-term portion ($1,992,000 and $1,946,000 for March 27, 2015 and March 28, 2014, respectively) is included in other long-term liabilities on the Consolidated Balance Sheets. |
Contingencies
Contingencies | 9 Months Ended | |
Mar. 27, 2015 | ||
Contingencies [Abstract] | ||
Contingencies | D. | Contingencies |
The Company is involved in litigation of which the ultimate outcome and liability to the Company, if any, is not presently determinable. Management believes that final disposition of such litigation will not have a material impact on the Company’s results of operations, financial position or cash flows. |
Business_Segments
Business Segments | 9 Months Ended | ||||
Mar. 27, 2015 | |||||
Business Segments [Abstract] | |||||
Business Segments | E. | Business Segments | |||
The Company and its subsidiaries are engaged in the manufacture and sale of marine and heavy duty off-highway power transmission equipment. Principal products include marine transmissions, surface drives, propellers and boat management systems, as well as power-shift transmissions, hydraulic torque converters, power take-offs, industrial clutches and controls systems. The Company sells to both domestic and foreign customers in a variety of market areas, principally pleasure craft, commercial and military marine markets, as well as in the energy and natural resources, government and industrial markets. | |||||
The Company has two reportable segments: manufacturing and distribution. These segments are managed separately because each provides different services and requires different technology and marketing strategies. The accounting practices of the segments are the same as those described in the summary of significant accounting policies. Transfers among segments are at established inter-company selling prices. Management evaluates the performance of its segments based on net earnings. | |||||
Information about the Company’s segments is summarized as follows (in thousands): | |||||
Three Months Ended | Nine Months Ended | ||||
Mar. 27, | Mar. 28, | Mar. 27, | Mar. 28, | ||
2015 | 2014 | 2015 | 2014 | ||
Manufacturing segment sales | $54,519 | $52,957 | $178,143 | $163,224 | |
Distribution segment sales | 26,261 | 28,441 | 79,247 | 90,018 | |
Inter/Intra segment elimination - manufacturing | -16,441 | -18,233 | -50,902 | -54,452 | |
Inter/Intra segment elimination - distribution | -3,398 | -2,460 | -8,032 | -8,447 | |
Net sales | $60,941 | $60,705 | $198,456 | $190,343 | |
Manufacturing segment net earnings (loss) | $3,589 | ($9) | $12,793 | $3,662 | |
Distribution segment net earnings | 1,341 | 1,516 | 4,297 | 4,818 | |
Corporate and eliminations | -1,984 | -1,982 | -6,354 | -7,160 | |
Net earnings (loss) attributable to Twin Disc | $2,946 | ($475) | $10,736 | $1,320 | |
Mar. 27, | June 30, | ||||
Assets | 2015 | 2014 | |||
Manufacturing segment assets | $247,531 | $254,652 | |||
Distribution segment assets | 56,185 | 57,233 | |||
Corporate assets and elimination | |||||
of inter-company assets | -57,340 | -44,900 | |||
Total assets | $246,376 | $266,985 |
StockBased_Compensation
Stock-Based Compensation | 9 Months Ended | |
Mar. 27, 2015 | ||
Stock-Based Compensation [Abstract] | ||
Stock-Based Compensation | F. | Stock-Based Compensation |
In the first nine months of fiscal 2015 and 2014, the Company granted a target number of 15,861 and 43,154 performance stock unit awards, respectively, to various employees of the Company, including executive officers. The performance stock unit awards granted in fiscal 2015 will vest if the Company achieves a specified target objective relating to consolidated economic profit (as defined in the Performance Stock Unit Award Grant Agreement) in the cumulative three fiscal year period ending June 30, 2017. The performance stock unit awards granted in fiscal 2015 are subject to adjustment if the Company’s economic profit for the period falls below or exceeds the specified target objective, and the maximum number of performance stock units that can be awarded if the target objective is exceeded is 13,621. Based upon actual results to date and the low probability of achieving the threshold performance levels, the Company is currently not accruing the performance stock unit awards granted in fiscal 2015. The performance stock unit awards granted in fiscal 2014 will vest if the Company achieves a specified target objective relating to consolidated economic profit (as defined in the Performance Stock Unit Award Grant Agreement) in the cumulative three fiscal year period ending June 30, 2016. The performance stock unit awards granted in fiscal 2014 are subject to adjustment if the Company’s economic profit for the period falls below or exceeds the specified target objective, and the maximum number of performance stock units that can be awarded if the target objective is exceeded is 22,205. Based upon actual results to date and the low probability of achieving the threshold performance levels, the Company is currently not accruing the performance stock unit awards granted in fiscal 2014. There were 48,594 and 54,874 unvested stock unit awards outstanding at March 27, 2015 and March 28, 2014, respectively. The weighted average grant date fair value of the unvested awards at March 27, 2015 was $24.70. The performance stock unit awards are remeasured at fair-value based upon the Company’s stock price at the end of each reporting period. The fair-value of the stock unit awards are expensed over the performance period for the shares that are expected to ultimately vest. There was no compensation expense for the three and nine months ended March 27, 2015 and March 28, 2014, related to the performance stock unit award grants. At March 27, 2015, the Company had $847,000 of unrecognized compensation expense related to the unvested shares that would vest if the specified target objective was achieved for the fiscal 2015, 2014 and 2013 awards. The total fair value of performance stock unit awards vested as of March 27, 2015 and March 28, 2014 was $0. The performance stock unit awards are cash based, and would therefore be recorded as a liability on the Company’s Consolidated Balance Sheets. As of March 27, 2015, these awards are $0. As of June 30, 2014, there were no awards included in “Liabilities” due to actual results to date and the low probability of achieving any of the threshold performance levels. | ||
In the first nine months of fiscal 2015 and 2014, the Company granted a target number of 16,261 and 17,312 performance stock awards, respectively, to various employees of the Company, including executive officers. The performance stock awards granted in fiscal 2015 will vest if the Company achieves a specified target objective relating to consolidated economic profit (as defined in the Performance Stock Award Grant Agreement) in the cumulative three fiscal year period ending June 30, 2017. The performance stock awards granted in fiscal 2015 are subject to adjustment if the Company’s economic profit for the period falls below or exceeds the specified target objective, and the maximum number of performance shares that can be awarded if the target objective is exceeded is 14,101. Based upon actual results to date and the low probability of achieving the threshold performance levels, the Company is currently not accruing the performance stock awards granted in fiscal 2015. The performance stock awards granted in fiscal 2014 will vest if the Company achieves a specified target objective relating to consolidated economic profit (as defined in the Performance Stock Award Grant Agreement) in the cumulative three fiscal year period ending June 30, 2016. The performance stock awards granted in fiscal 2014 are subject to adjustment if the Company’s economic profit for the period falls below or exceeds the specified target objective, and the maximum number of performance shares that can be awarded if the target objective is exceeded is 17,038. Based upon actual results to date and the low probability of achieving the threshold performance levels, the Company is currently not accruing the performance stock awards granted in fiscal 2014. There were 51,478 and 59,453 unvested stock awards outstanding at March 27, 2015 and March 28, 2014, respectively. The fair value of the stock awards (on the date of grant) is expensed over the performance period for the shares that are expected to ultimately vest. There was no compensation expense for the three and nine months ended March 27, 2015 and March 28, 2014, related to performance stock awards. The weighted average grant date fair value of the unvested awards at March 27, 2015 was $24.04. At March 27, 2015, the Company had $1,238,000 of unrecognized compensation expense related to the unvested shares that would vest if the specified target objective was achieved for the fiscal 2015, 2014 and 2013 awards. The total fair value of performance stock awards vested as of March 27, 2015 and March 28, 2018 was $0. | ||
In addition to the performance shares mentioned above, the Company has unvested restricted stock outstanding that will vest if certain service conditions are fulfilled. The fair value of the restricted stock grants is recorded as compensation over the vesting period, which is generally 1 to 4 years. During the first nine months of fiscal 2015 and 2014, the Company granted 57,216 and 51,004 service based restricted shares, respectively, to employees in each year. There were 97,789 and 119,297 unvested shares outstanding at March 27, 2015 and March 28, 2014, respectively. The compensation expense for the three and nine months ended March 27, 2015, related to these service-based awards approximated $8,000 and $425,000, respectively. The compensation expense for the three and nine months ended March 28, 2014, related to these service-based awards approximated $308,000 and $934,000, respectively. The total fair value of restricted stock grants vested as of March 27, 2015 and March 28, 2014 was $941,000 and $3,053,000, respectively. As of March 27, 2015, the Company had $1,227,000 of unrecognized compensation expense related to restricted stock which will be recognized over the next three years. |
Pension_and_Other_Postretireme
Pension and Other Postretirement Benefit Plans | 9 Months Ended | ||||
Mar. 27, 2015 | |||||
Pension and Other Postretirement Benefit Plans [Abstract] | |||||
Pension and Other Postretirement Benefit Plans | G. | Pension and Other Postretirement Benefit Plans | |||
The Company has non-contributory, qualified defined benefit plans covering substantially all domestic employees hired prior to October 1, 2003 and certain foreign employees. Additionally, the Company provides health care and life insurance benefits for certain domestic retirees. Components of net periodic benefit cost for the defined benefit pension plans and the other postretirement benefit plan are as follows (in thousands): | |||||
Three Months Ended | Nine Months Ended | ||||
Mar. 27, | Mar. 28, | Mar. 27, | Mar. 28, | ||
2015 | 2014 | 2015 | 2014 | ||
Pension Benefits: | |||||
Service cost | $120 | $135 | $359 | $402 | |
Interest cost | 1,215 | 1,357 | 3,661 | 4,068 | |
Expected return on plan assets | -2,105 | -1,648 | -5,469 | -4,942 | |
Amortization of transition obligation | 10 | 19 | 29 | 57 | |
Amortization of net loss | 607 | 714 | 1,825 | 2,141 | |
Net periodic benefit cost | ($153) | $577 | $405 | $1,726 | |
Postretirement Benefits: | |||||
Service cost | $8 | $9 | $23 | $28 | |
Interest cost | 144 | 165 | 434 | 494 | |
Amortization of net actuarial loss | 160 | 150 | 478 | 451 | |
Net periodic benefit cost | $312 | $324 | $935 | $973 | |
The Company expects to contribute approximately $6,172,000 to its pension plans in fiscal 2015. As of March 27, 2015, $5,562,000 in contributions have been made. | |||||
The Company has reclassified $542,000 (net of $322,000 in taxes) and $1,545,000 (net of $917,000 in taxes) of benefit plan adjustments from accumulated other comprehensive loss into earnings during the three and nine months ended March 27, 2015. The Company has reclassified $528,000 (net of $354,000 in taxes) and $1,506,000 (net of $1,060,000 in taxes) of benefit plan adjustments from accumulated other comprehensive loss during the three and nine months ended March 28, 2014. These reclassifications are included in the computation of net periodic benefit cost. |
Income_Taxes
Income Taxes | 9 Months Ended | |
Mar. 27, 2015 | ||
Income Taxes [Abstract] | ||
Income Taxes | H. | Income Taxes |
The effective tax rate for the first nine months of fiscal 2015 is 31.8%, which is lower than the prior year’s 66.6%. Both periods were impacted by non-deductible operating losses in a certain foreign jurisdiction that is subject to a full valuation allowance, which is the largest driver of the change in the effective rate compared to the prior year. The much lower fiscal 2015 rate also reflects a $7,100,000 increase in domestic earnings, offset by the Section 199 credit and benefits from the cumulative effect of the reinstatement of the federal research and development tax credit. The mix of tax preference items and foreign income and foreign income credits remained consistent with prior periods, resulting in a lower effective tax rate. During the second quarter of fiscal 2015 the Company also recognized previously unrecognized tax benefits due to the resolution of a state income tax audit. The fiscal 2014 rate reflects the impact of reduced domestic earnings base with constant foreign income and credits. | ||
The Company maintains valuation allowances when it is more likely than not that all or a portion of a deferred tax asset will not be realized. Changes in valuation allowances from period to period are included in the tax provision in the period of change. In determining whether a valuation allowance is required, the Company takes into account such factors as prior earnings history, expected future earnings, carry-back and carry-forward periods, and tax strategies that could potentially enhance the likelihood of realization of a deferred tax asset. Due to recent operating losses in a certain foreign jurisdiction, the Company has evaluated the realizability of the net deferred tax assets related to this jurisdiction. This evaluation concluded that, based primarily upon recent losses in this jurisdiction and failure to achieve targeted levels of improvement, a full valuation allowance continues to be necessary. | ||
The Company has not provided for additional U.S. income taxes on cumulative earnings of consolidated foreign subsidiaries that are considered to be reinvested indefinitely. The Company reaffirms its position that these earnings remain permanently invested, and has no plans to repatriate funds to the U.S. for the foreseeable future. Such earnings could become taxable upon the sale or liquidation of these foreign subsidiaries or upon dividend repatriation. | ||
Accounting policies for interim reporting require the Company to adjust its effective tax rate each quarter to be consistent with the estimated annual effective tax rate. Under this effective tax rate methodology, the Company applies an estimated annual income tax rate to its year-to-date ordinary earnings to derive its income tax provision each quarter. The impact of the Company’s operations in certain foreign locations is removed from the overall effective tax rate methodology and recorded directly based upon year-to-date results as these operations anticipate net operating losses for the year for which no tax benefit can be recognized. | ||
The Company has approximately $835,000 of unrecognized tax benefits, including related interest and penalties, as of March 27, 2015, which, if recognized, would favorably impact the effective tax rate. There was no significant change in total unrecognized tax benefits due to the settlement of audits or expiration of statutes of limitations during the quarter ended March 27, 2015. It appears reasonably possible that the amount of unrecognized tax benefits could change in the next twelve months due to on-going audit activity. | ||
Annually, the Company files income tax returns in various taxing jurisdictions inside and outside the United States. In general, the tax years that remain subject to examination are 2009 through 2014 for the major operations in Italy, Canada, Belgium, and Japan. The tax years open to examination in the U.S. are for years subsequent to fiscal 2011. During this quarter the company was notified by the state of Wisconsin of a tax examination covering open periods. |
Goodwill_and_Other_Intangibles
Goodwill and Other Intangibles | 9 Months Ended | ||||
Mar. 27, 2015 | |||||
Goodwill and Other Intangibles [Abstract] | |||||
Goodwill and Other Intangibles | I. | Goodwill and Other Intangibles | |||
The changes in the carrying amount of goodwill, all of which is allocated to the manufacturing segment, for the nine months ended March 27, 2015 were as follows (in thousands): | |||||
Gross Carrying Amount | Accumulated Impairment | Net Book Value | |||
Balance at June 30, 2014 | $ 17,133 | ($ 3,670) | $13,463 | ||
Translation adjustment | (645) | - | (645) | ||
Balance at March 27, 2015 | $ 16,488 | ($ 3,670) | $12,818 | ||
The gross carrying amount and accumulated amortization of the Company’s intangible assets that have definite useful lives and are subject to amortization as of March 27, 2015 and June 30, 2014 were as follows (in thousands): | |||||
27-Mar-15 | |||||
Gross Carrying Amount | Accumulated Amortization | Accumulated Impairment | Net Book Value | ||
Licensing agreements | $ 3,015 | ($ 2,490) | $ - | $ 525 | |
Non-compete agreements | 2,128 | ( 2,045) | ( 83) | - | |
Trade name | 1,675 | ( 169) | - | 1,506 | |
Other | 6,473 | ( 5,256) | ( 1,194) | 23 | |
$13,291 | ($ 9,960) | ($ 1,277) | $ 2,054 | ||
30-Jun-14 | |||||
Gross Carrying Amount | Accumulated Amortization | Accumulated Impairment | Net Book Value | ||
Licensing agreements | $ 3,015 | ($ 2,445) | $ - | $ 570 | |
Non-compete agreements | 2,128 | ( 2,045) | ( 83) | - | |
Trade name | 2,009 | ( 100) | - | 1,909 | |
Other | 6,482 | ( 5,193) | ( 1,194) | 95 | |
$13,634 | ($ 9,783) | ($ 1,277) | $ 2,574 | ||
The weighted average remaining useful life of the intangible assets included in the table above is approximately 16 years. | |||||
Intangible amortization expense was $56,000 and $177,000 for the three and nine months ended March 27, 2015, and $121,000 and $356,000 for the three and nine months ended March 28, 2014, respectively. Estimated intangible amortization expense for the remainder of fiscal 2015 and each of the next five fiscal years is as follows (in thousands): | |||||
Fiscal Year | |||||
2015 | $55 | ||||
2016 | 147 | ||||
2017 | 143 | ||||
2018 | 143 | ||||
2019 | 143 | ||||
2020 | 143 | ||||
The gross carrying amount of the Company’s intangible assets that have indefinite lives and are not subject to amortization as of March 27, 2015 and June 30, 2014 are $210,000 and $223,000, respectively. These assets are comprised of acquired trade names. |
Longterm_Debt
Long-term Debt | 9 Months Ended | ||
Mar. 27, 2015 | |||
Long-term Debt [Abstract] | |||
Long-term Debt | J. | Long-term Debt | |
Long-term debt at March 27, 2015 and June 30, 2014 consisted of the following (in thousands): | |||
March 27, | June 30, | ||
2015 | 2014 | ||
Revolving loan | $5,235 | $11,200 | |
10-year unsecured senior notes | 7,143 | 7,143 | |
Other | 22 | 61 | |
Subtotal | 12,400 | 18,404 | |
Less: current maturities and short-term borrowings | -3,571 | -3,604 | |
Total long-term debt | $8,829 | $14,800 | |
The revolving loan and unsecured senior notes listed above are subject to certain covenants, including restrictions on investments, acquisitions and indebtedness. Financial covenants, as defined, include a minimum consolidated net worth, a minimum EBITDA for the most recent four fiscal quarters, and a maximum total funded debt to EBITDA ratio. As of March 27, 2015, the Company was in compliance with these covenants. | |||
The fair value of long-term debt is estimated by discounting the future cash flows at rates offered to the Company for similar debt instruments of comparable maturities. This rate was represented by the US Treasury Three-Year Yield Curve Rate (0.92% and 0.88% for March 27, 2015 and June 30, 2014, respectively), plus the current add-on related to the revolving loan agreement (1.00% for March 27, 2015 and June 30, 2014) resulting in a total rate of 1.92% and 1.88% for March 27, 2015 and June 30, 2014, respectively. The fair value of the Company’s 10-year unsecured senior notes due April 10, 2016 was approximately $7,385,000 and $7,605,000 at March 27, 2015 and June 30, 2014, respectively. The Company’s revolving loan agreement approximates fair value at March 27, 2015 and June 30, 2014. If measured at fair value in the financial statements, long-term debt (including the current portion) would be classified as Level 2 in the fair value hierarchy. |
Shareholders_Equity
Shareholders' Equity | 9 Months Ended | ||||||
Mar. 27, 2015 | |||||||
Shareholders' Equity [Abstract] | |||||||
Shareholders' Equity | K. | Shareholders’ Equity | |||||
On February 1, 2008, the Board of Directors authorized the purchase of 500,000 shares of Common Stock at market values. On July 27, 2012, the Board of Directors authorized the purchase of an additional 375,000 shares of Common Stock at market values. These authorizations have no expiration. The Company made open market purchases of 125,000 shares of its outstanding Common Stock during fiscal 2012 and 185,000 shares during fiscal 2013. | |||||||
The following is a reconciliation of the Company’s equity balances for the first fiscal nine months of 2014 and 2015 (in thousands): | |||||||
Twin Disc, Inc. Shareholders’ Equity | |||||||
Accumulated | |||||||
Other | Non- | ||||||
Common | Retained | Comprehensive | Treasury | Controlling | Total | ||
Stock | Earnings | Income (Loss) | Stock | Interest | Equity | ||
Balance-June 30, 2013 | $13,183 | $184,110 | ($25,899) | ($28,890) | $1,058 | $143,562 | |
Net income | 1,320 | 168 | 1,488 | ||||
Translation adjustments | 4,137 | (84) | 4,053 | ||||
Benefit plan adjustments, net of tax | 1,506 | 1,506 | |||||
Cash dividends | (3,045) | (487) | (3,532) | ||||
Compensation expense and | |||||||
windfall tax benefits | 1,457 | 1,457 | |||||
Shares (acquired) issued, net | -2,964 | 795 | (2,169) | ||||
Balance-March 28, 2014 | $11,676 | $182,385 | ($20,256) | ($28,095) | $655 | $146,365 | |
Twin Disc, Inc. Shareholders’ Equity | |||||||
Accumulated | |||||||
Other | Non- | ||||||
Common | Retained | Comprehensive | Treasury | Controlling | Total | ||
Stock | Earnings | Income (Loss) | Stock | Interest | Equity | ||
Balance-June 30, 2014 | $11,973 | $183,695 | ($15,943) | ($28,141) | $727 | $152,311 | |
Net income | 10,736 | 173 | 10,909 | ||||
Translation adjustments | -14,676 | -86 | -14,762 | ||||
Benefit plan adjustments, net of tax | 1,545 | 1,545 | |||||
Cash dividends | -3,047 | -219 | -3,266 | ||||
Compensation expense and | |||||||
windfall tax benefits | 388 | 388 | |||||
Shares (acquired) issued, net | -392 | 94 | -298 | ||||
Balance-March 27, 2015 | $11,969 | $191,384 | ($29,074) | ($28,047) | $595 | $146,827 | |
Reconciliations for the changes in accumulated other comprehensive income (loss), net of tax, by component for the three months ended September 27, December 27, 2013, and March 28, 2014, and September 26, December 26, 2014, and March 27, 2015, are as follows: | |||||||
Translation Adjustment | Benefit Plan Adjustment | ||||||
Balance at June 30, 2013 | $ 16,949 | ($42,848) | |||||
Other comprehensive loss before reclassifications | 1,926 | (62) | |||||
Amounts reclassified from accumulated other comprehensive income | - | 512 | |||||
Net current period other comprehensive income | 1,926 | 450 | |||||
Balance at September 27, 2013 | $ 18,875 | ($42,398) | |||||
Other comprehensive loss before reclassifications | 1,113 | 14 | |||||
Amounts reclassified from accumulated other comprehensive income | - | 514 | |||||
Net current period other comprehensive income | 1,113 | 528 | |||||
Balance at December 27, 2013 | $ 19,988 | ($41,870) | |||||
Other comprehensive loss before reclassifications | 1,098 | 15 | |||||
Amounts reclassified from accumulated other comprehensive income | - | 513 | |||||
Net current period other comprehensive income | 1,098 | 528 | |||||
Balance at March 28, 2014 | $ 21,086 | ($41,342) | |||||
Translation Adjustment | Benefit Plan Adjustment | ||||||
Balance at June 30, 2014 | $ 20,779 | ($36,722) | |||||
Other comprehensive loss before reclassifications | (4,337) | - | |||||
Amounts reclassified from accumulated other comprehensive income | - | 488 | |||||
Net current period other comprehensive income | (4,337) | 488 | |||||
Balance at September 26, 2014 | $ 16,442 | ($36,234) | |||||
Other comprehensive loss before reclassifications | (4,501) | 27 | |||||
Amounts reclassified from accumulated other comprehensive income | - | 488 | |||||
Net current period other comprehensive income | (4,501) | 515 | |||||
Balance at December 26, 2014 | $ 11,941 | ($35,719) | |||||
Other comprehensive loss before reclassifications | (5,838) | 54 | |||||
Amounts reclassified from accumulated other comprehensive income | - | 488 | |||||
Net current period other comprehensive income | (5,838) | 542 | |||||
Balance at March 27, 2015 | $ 6,103 | ($35,177) | |||||
Reconciliations for the reclassifications out of accumulated other comprehensive income (loss), net of tax for the three and nine months ended March 28, 2014 are as follows: | |||||||
Amount Reclassified Three Months Ended | Amount Reclassified Nine Months Ended | ||||||
28-Mar-14 | 28-Mar-14 | ||||||
Amortization of benefit plan items | |||||||
Actuarial losses | $ 864 (a) | $ 2,592 (a) | |||||
Transition asset and prior service benefit | 19 | 57 | |||||
Total before tax benefit | 883 | 2,649 | |||||
Tax benefit | 370 | 1,110 | |||||
Total reclassification net of tax | $ 513 | $ 1,539 | |||||
(a) | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note G "Pension and Other Postretirement Benefit Plans" for further details). | ||||||
Reconciliations for the reclassifications out of accumulated other comprehensive income (loss), net of tax for the three and nine months ended March 27, 2015 are as follows: | |||||||
Amount Reclassified Three Months Ended | Amount Reclassified Nine Months Ended | ||||||
27-Mar-15 | 27-Mar-15 | ||||||
Amortization of benefit plan items | |||||||
Actuarial losses | $ 767 (a) | $ 2,303 (a) | |||||
Transition asset and prior service benefit | 10 | 29 | |||||
Total before tax benefit | 777 | 2,332 | |||||
Tax benefit | 289 | 868 | |||||
Total reclassification net of tax | $ 488 | $ 1,464 | |||||
(a) | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note G "Pension and Other Postretirement Benefit Plans" for further details). |
Restructuring_of_Operations
Restructuring of Operations | 9 Months Ended | |
Mar. 27, 2015 | ||
Restructuring of Operations [Abstract] | ||
Restructuring of Operations | L. | Restructuring of Operations |
During the first quarter of fiscal 2014, the Company recorded a pre-tax restructuring charge of $1,094,000 representing the incremental cost above the minimum legal indemnity for a targeted workforce reduction at its Belgian operation, following finalization of negotiations with the local labor union. The minimum legal indemnity of $548,000 was recorded in the fourth quarter of fiscal 2013, upon announcement of the intended restructuring action. During fiscal 2014, the Company made cash payments of $857,000, resulting in an accrual balance at June 30, 2014 of $785,000. The Company made additional payments of $17,000 in the first nine months of fiscal 2015, resulting in a March 27, 2015 balance of $610,000 after a foreign exchange impact of $158,000. This remaining obligation relates to increased pension benefits agreed to as part of the restructuring and is expected to be paid out over the next several years. |
Basis_of_Presentation_Policies
Basis of Presentation (Policies) | 9 Months Ended |
Mar. 27, 2015 | |
Basis of Presentation [Abstract] | |
New Accounting Releases | New Accounting Releases |
In April 2015, the Financial Accounting Standards Board (“FASB”) issued guidance intended to amend current presentation guidance by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. The amendments in this guidance are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015 (the Company’s fiscal 2017). The adoption of this guidance is not expected to have a material impact on the Company’s financial disclosures. | |
In August 2014, the Financial Accounting Standards Board (“FASB”) issued updated guidance intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern. The amendments in this guidance are effective for fiscal years ending after December 15, 2016 (the Company’s fiscal 2017), and interim periods within fiscal years beginning after December 15, 2016. The adoption of this guidance is not expected to have a material impact on the Company’s financial disclosures. | |
In June 2014, the FASB issued stock compensation guidance requiring that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. The amendments in this guidance are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015 (the Company’s fiscal 2017). The adoption of this guidance is not expected to have a material impact on the Company’s financial disclosures. | |
In May 2014, the FASB issued updated guidance on revenue from contracts with customers. This revenue recognition guidance supersedes existing US GAAP guidance, including most industry-specific guidance. The core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance identifies steps to apply in achieving this principle. This updated guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016 (the Company’s fiscal 2018). The Company is currently evaluating the potential impact of this guidance on the Company’s financial disclosures and results. | |
In April 2014, the FASB issued updated guidance on the reporting for discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. The new guidance also requires expanded financial disclosures about discontinued operations. The amendments in this updated guidance are effective for the first quarter of the Company’s fiscal 2016. The adoption of this guidance is not expected to have a material impact on the Company’s financial disclosures. | |
In July 2013, the FASB issued guidance stating that, except in certain defined circumstances, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2013 (the Company’s fiscal 2015). The adoption of this guidance did not have a material impact on the Company’s financial disclosures. |
Inventory_Tables
Inventory (Tables) | 9 Months Ended | ||
Mar. 27, 2015 | |||
Inventory [Abstract] | |||
Major Classes of Inventories | The major classes of inventories were as follows (in thousands): | ||
March 27, | June 30, | ||
2015 | 2014 | ||
Inventories: | |||
Finished parts | $60,692 | $66,418 | |
Work in process | 11,356 | 12,419 | |
Raw materials | 17,991 | 18,742 | |
$90,039 | $97,579 |
Warranty_Tables
Warranty (Tables) | 9 Months Ended | ||||
Mar. 27, 2015 | |||||
Warranty [Abstract] | |||||
Warranty Reserve | The following is a listing of the activity in the warranty reserve during the three and nine month periods ended March 27, 2015 and March 28, 2014 (in thousands): | ||||
Three Months Ended | Nine Months Ended | ||||
Mar. 27, | Mar. 28, | Mar. 27, | Mar. 28, | ||
2015 | 2014 | 2015 | 2014 | ||
Reserve balance, beginning of period | $5,952 | $5,800 | $5,968 | $5,701 | |
Current period expense | 582 | 399 | 1,812 | 1,541 | |
Payments or credits to customers | -453 | -498 | -1,482 | -1,646 | |
Translation | -185 | 11 | -402 | 116 | |
Reserve balance, end of period | $5,896 | $5,712 | $5,896 | $5,712 |
Business_Segments_Tables
Business Segments (Tables) | 9 Months Ended | ||||
Mar. 27, 2015 | |||||
Business Segments [Abstract] | |||||
Summarized Information about Company's Segments | Information about the Company’s segments is summarized as follows (in thousands): | ||||
Three Months Ended | Nine Months Ended | ||||
Mar. 27, | Mar. 28, | Mar. 27, | Mar. 28, | ||
2015 | 2014 | 2015 | 2014 | ||
Manufacturing segment sales | $54,519 | $52,957 | $178,143 | $163,224 | |
Distribution segment sales | 26,261 | 28,441 | 79,247 | 90,018 | |
Inter/Intra segment elimination - manufacturing | -16,441 | -18,233 | -50,902 | -54,452 | |
Inter/Intra segment elimination - distribution | -3,398 | -2,460 | -8,032 | -8,447 | |
Net sales | $60,941 | $60,705 | $198,456 | $190,343 | |
Manufacturing segment net earnings (loss) | $3,589 | ($9) | $12,793 | $3,662 | |
Distribution segment net earnings | 1,341 | 1,516 | 4,297 | 4,818 | |
Corporate and eliminations | -1,984 | -1,982 | -6,354 | -7,160 | |
Net earnings (loss) attributable to Twin Disc | $2,946 | ($475) | $10,736 | $1,320 | |
Mar. 27, | June 30, | ||||
Assets | 2015 | 2014 | |||
Manufacturing segment assets | $247,531 | $254,652 | |||
Distribution segment assets | 56,185 | 57,233 | |||
Corporate assets and elimination | |||||
of inter-company assets | -57,340 | -44,900 | |||
Total assets | $246,376 | $266,985 |
Pension_and_Other_Postretireme1
Pension and Other Postretirement Benefit Plans (Tables) | 9 Months Ended | ||||
Mar. 27, 2015 | |||||
Pension and Other Postretirement Benefit Plans [Abstract] | |||||
Components of Net Periodic Benefit Cost | Components of net periodic benefit cost for the defined benefit pension plans and the other postretirement benefit plan are as follows (in thousands): | ||||
Three Months Ended | Nine Months Ended | ||||
Mar. 27, | Mar. 28, | Mar. 27, | Mar. 28, | ||
2015 | 2014 | 2015 | 2014 | ||
Pension Benefits: | |||||
Service cost | $120 | $135 | $359 | $402 | |
Interest cost | 1,215 | 1,357 | 3,661 | 4,068 | |
Expected return on plan assets | -2,105 | -1,648 | -5,469 | -4,942 | |
Amortization of transition obligation | 10 | 19 | 29 | 57 | |
Amortization of net loss | 607 | 714 | 1,825 | 2,141 | |
Net periodic benefit cost | ($153) | $577 | $405 | $1,726 | |
Postretirement Benefits: | |||||
Service cost | $8 | $9 | $23 | $28 | |
Interest cost | 144 | 165 | 434 | 494 | |
Amortization of net actuarial loss | 160 | 150 | 478 | 451 | |
Net periodic benefit cost | $312 | $324 | $935 | $973 |
Goodwill_and_Other_Intangibles1
Goodwill and Other Intangibles (Tables) | 9 Months Ended | ||||
Mar. 27, 2015 | |||||
Goodwill and Other Intangibles [Abstract] | |||||
Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill, all of which is allocated to the manufacturing segment, for the nine months ended March 27, 2015 were as follows (in thousands): | ||||
Gross Carrying Amount | Accumulated Impairment | Net Book Value | |||
Balance at June 30, 2014 | $ 17,133 | ($ 3,670) | $13,463 | ||
Translation adjustment | (645) | - | (645) | ||
Balance at March 27, 2015 | $ 16,488 | ($ 3,670) | $12,818 | ||
Acquired Intangible Assets with Finite Lives | The gross carrying amount and accumulated amortization of the Company’s intangible assets that have definite useful lives and are subject to amortization as of March 27, 2015 and June 30, 2014 were as follows (in thousands): | ||||
27-Mar-15 | |||||
Gross Carrying Amount | Accumulated Amortization | Accumulated Impairment | Net Book Value | ||
Licensing agreements | $ 3,015 | ($ 2,490) | $ - | $ 525 | |
Non-compete agreements | 2,128 | ( 2,045) | ( 83) | - | |
Trade name | 1,675 | ( 169) | - | 1,506 | |
Other | 6,473 | ( 5,256) | ( 1,194) | 23 | |
$13,291 | ($ 9,960) | ($ 1,277) | $ 2,054 | ||
30-Jun-14 | |||||
Gross Carrying Amount | Accumulated Amortization | Accumulated Impairment | Net Book Value | ||
Licensing agreements | $ 3,015 | ($ 2,445) | $ - | $ 570 | |
Non-compete agreements | 2,128 | ( 2,045) | ( 83) | - | |
Trade name | 2,009 | ( 100) | - | 1,909 | |
Other | 6,482 | ( 5,193) | ( 1,194) | 95 | |
$13,634 | ($ 9,783) | ($ 1,277) | $ 2,574 | ||
Estimated Intangible Amortization Expense | Estimated intangible amortization expense for the remainder of fiscal 2015 and each of the next five fiscal years is as follows (in thousands): | ||||
Fiscal Year | |||||
2015 | $55 | ||||
2016 | 147 | ||||
2017 | 143 | ||||
2018 | 143 | ||||
2019 | 143 | ||||
2020 | 143 |
Longterm_Debt_Tables
Long-term Debt (Tables) | 9 Months Ended | ||
Mar. 27, 2015 | |||
Long-term Debt [Abstract] | |||
Long-term Debt | Long-term debt at March 27, 2015 and June 30, 2014 consisted of the following (in thousands): | ||
March 27, | June 30, | ||
2015 | 2014 | ||
Revolving loan | $5,235 | $11,200 | |
10-year unsecured senior notes | 7,143 | 7,143 | |
Other | 22 | 61 | |
Subtotal | 12,400 | 18,404 | |
Less: current maturities and short-term borrowings | -3,571 | -3,604 | |
Total long-term debt | $8,829 | $14,800 |
Shareholders_Equity_Tables
Shareholders' Equity (Tables) | 9 Months Ended | ||||||
Mar. 27, 2015 | |||||||
Shareholders' Equity [Abstract] | |||||||
Reconciliation of Equity Balances | The following is a reconciliation of the Company’s equity balances for the first fiscal nine months of 2014 and 2015 (in thousands): | ||||||
Twin Disc, Inc. Shareholders’ Equity | |||||||
Accumulated | |||||||
Other | Non- | ||||||
Common | Retained | Comprehensive | Treasury | Controlling | Total | ||
Stock | Earnings | Income (Loss) | Stock | Interest | Equity | ||
Balance-June 30, 2013 | $13,183 | $184,110 | ($25,899) | ($28,890) | $1,058 | $143,562 | |
Net income | 1,320 | 168 | 1,488 | ||||
Translation adjustments | 4,137 | (84) | 4,053 | ||||
Benefit plan adjustments, net of tax | 1,506 | 1,506 | |||||
Cash dividends | (3,045) | (487) | (3,532) | ||||
Compensation expense and | |||||||
windfall tax benefits | 1,457 | 1,457 | |||||
Shares (acquired) issued, net | -2,964 | 795 | (2,169) | ||||
Balance-March 28, 2014 | $11,676 | $182,385 | ($20,256) | ($28,095) | $655 | $146,365 | |
Twin Disc, Inc. Shareholders’ Equity | |||||||
Accumulated | |||||||
Other | Non- | ||||||
Common | Retained | Comprehensive | Treasury | Controlling | Total | ||
Stock | Earnings | Income (Loss) | Stock | Interest | Equity | ||
Balance-June 30, 2014 | $11,973 | $183,695 | ($15,943) | ($28,141) | $727 | $152,311 | |
Net income | 10,736 | 173 | 10,909 | ||||
Translation adjustments | -14,676 | -86 | -14,762 | ||||
Benefit plan adjustments, net of tax | 1,545 | 1,545 | |||||
Cash dividends | -3,047 | -219 | -3,266 | ||||
Compensation expense and | |||||||
windfall tax benefits | 388 | 388 | |||||
Shares (acquired) issued, net | -392 | 94 | -298 | ||||
Balance-March 27, 2015 | $11,969 | $191,384 | ($29,074) | ($28,047) | $595 | $146,827 | |
Reconciliation for the Changes in Accumulated Other Comprehensive Income (Loss), Net of Tax, by Component | Reconciliations for the changes in accumulated other comprehensive income (loss), net of tax, by component for the three months ended September 27, December 27, 2013, and March 28, 2014, and September 26, December 26, 2014, and March 27, 2015, are as follows: | ||||||
Translation Adjustment | Benefit Plan Adjustment | ||||||
Balance at June 30, 2013 | $ 16,949 | ($42,848) | |||||
Other comprehensive loss before reclassifications | 1,926 | (62) | |||||
Amounts reclassified from accumulated other comprehensive income | - | 512 | |||||
Net current period other comprehensive income | 1,926 | 450 | |||||
Balance at September 27, 2013 | $ 18,875 | ($42,398) | |||||
Other comprehensive loss before reclassifications | 1,113 | 14 | |||||
Amounts reclassified from accumulated other comprehensive income | - | 514 | |||||
Net current period other comprehensive income | 1,113 | 528 | |||||
Balance at December 27, 2013 | $ 19,988 | ($41,870) | |||||
Other comprehensive loss before reclassifications | 1,098 | 15 | |||||
Amounts reclassified from accumulated other comprehensive income | - | 513 | |||||
Net current period other comprehensive income | 1,098 | 528 | |||||
Balance at March 28, 2014 | $ 21,086 | ($41,342) | |||||
Translation Adjustment | Benefit Plan Adjustment | ||||||
Balance at June 30, 2014 | $ 20,779 | ($36,722) | |||||
Other comprehensive loss before reclassifications | (4,337) | - | |||||
Amounts reclassified from accumulated other comprehensive income | - | 488 | |||||
Net current period other comprehensive income | (4,337) | 488 | |||||
Balance at September 26, 2014 | $ 16,442 | ($36,234) | |||||
Other comprehensive loss before reclassifications | (4,501) | 27 | |||||
Amounts reclassified from accumulated other comprehensive income | - | 488 | |||||
Net current period other comprehensive income | (4,501) | 515 | |||||
Balance at December 26, 2014 | $ 11,941 | ($35,719) | |||||
Other comprehensive loss before reclassifications | (5,838) | 54 | |||||
Amounts reclassified from accumulated other comprehensive income | - | 488 | |||||
Net current period other comprehensive income | (5,838) | 542 | |||||
Balance at March 27, 2015 | $ 6,103 | ($35,177) | |||||
Reconciliation for the Reclassifications Out of Accumulated Other Comprehensive Income (Loss), Net of Tax | Reconciliations for the reclassifications out of accumulated other comprehensive income (loss), net of tax for the three and nine months ended March 28, 2014 are as follows: | ||||||
Amount Reclassified Three Months Ended | Amount Reclassified Nine Months Ended | ||||||
28-Mar-14 | 28-Mar-14 | ||||||
Amortization of benefit plan items | |||||||
Actuarial losses | $ 864 (a) | $ 2,592 (a) | |||||
Transition asset and prior service benefit | 19 | 57 | |||||
Total before tax benefit | 883 | 2,649 | |||||
Tax benefit | 370 | 1,110 | |||||
Total reclassification net of tax | $ 513 | $ 1,539 | |||||
(a) | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note G "Pension and Other Postretirement Benefit Plans" for further details). | ||||||
Reconciliations for the reclassifications out of accumulated other comprehensive income (loss), net of tax for the three and nine months ended March 27, 2015 are as follows: | |||||||
Amount Reclassified Three Months Ended | Amount Reclassified Nine Months Ended | ||||||
27-Mar-15 | 27-Mar-15 | ||||||
Amortization of benefit plan items | |||||||
Actuarial losses | $ 767 (a) | $ 2,303 (a) | |||||
Transition asset and prior service benefit | 10 | 29 | |||||
Total before tax benefit | 777 | 2,332 | |||||
Tax benefit | 289 | 868 | |||||
Total reclassification net of tax | $ 488 | $ 1,464 | |||||
(a) | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note G "Pension and Other Postretirement Benefit Plans" for further details). |
Basis_of_Presentation_Details
Basis of Presentation (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 6 Months Ended | 3 Months Ended | 12 Months Ended | ||
Mar. 27, 2015 | Sep. 27, 2013 | Mar. 27, 2015 | Jun. 30, 2013 | Dec. 26, 2014 | Dec. 26, 2014 | Sep. 26, 2014 | Jun. 30, 2014 | |
Revision of Prior Period Financial Statements [Abstract] | ||||||||
Impact of errors correction on earnings | $437,000 | |||||||
Impact of errors correction on earnings net of tax attributable to parent | 69,000 | |||||||
Increase in impact of errors correction on earnings before income taxes and noncontrolling interest | 282,000 | |||||||
Increase (decrease) in impact of errors correction on net earnings | 2,000 | -175,000 | ||||||
Overstatement of Payroll Accrual [Member] | ||||||||
Revision of Prior Period Financial Statements [Abstract] | ||||||||
Impact of errors correction on earnings | 337,000 | |||||||
Overstatement of Warranty Accrual [Member] | ||||||||
Revision of Prior Period Financial Statements [Abstract] | ||||||||
Impact of errors correction on earnings | 217,000 | |||||||
Overstatement of Work in Progress Inventory [Member] | ||||||||
Revision of Prior Period Financial Statements [Abstract] | ||||||||
Impact of errors correction on earnings | -117,000 | |||||||
Understatement of Deferred Tax Liabilities [Member] | ||||||||
Revision of Prior Period Financial Statements [Abstract] | ||||||||
Impact of errors correction on earnings | 285,000 | |||||||
Overestimation of Pension Expenses [Member] | ||||||||
Revision of Prior Period Financial Statements [Abstract] | ||||||||
Impact of errors correction on earnings | 282,000 | |||||||
Understatement of Earnings [Member] | ||||||||
Revision of Prior Period Financial Statements [Abstract] | ||||||||
Impact of errors correction on earnings | 141,000 | 141,000 | ||||||
Understatement of Tax Expenses [Member] | ||||||||
Revision of Prior Period Financial Statements [Abstract] | ||||||||
Impact of errors correction on earnings | $175,000 |
Inventory_Details
Inventory (Details) (USD $) | Mar. 27, 2015 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Inventories [Abstract] | ||
Finished parts | $60,692 | $66,418 |
Work in process | 11,356 | 12,419 |
Raw materials | 17,991 | 18,742 |
Inventories, net | $90,039 | $97,579 |
Warranty_Details
Warranty (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 | |
Activity in warranty reserve [Abstract] | ||||
Reserve balance, beginning of period | $5,952,000 | $5,800,000 | $5,968,000 | $5,701,000 |
Current period expense | 582,000 | 399,000 | 1,812,000 | 1,541,000 |
Payments or credits to customers | -453,000 | -498,000 | -1,482,000 | -1,646,000 |
Translation | -185,000 | 11,000 | -402,000 | 116,000 |
Reserve balance, end of period | 5,896,000 | 5,712,000 | 5,896,000 | 5,712,000 |
Current portion of warranty accrual | 3,904,000 | 3,766,000 | 3,904,000 | 3,766,000 |
Long-term portion of warranty accrual | $1,992,000 | $1,946,000 | $1,992,000 | $1,946,000 |
Business_Segments_Details
Business Segments (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 | Jun. 30, 2014 |
Segment | |||||
Business Segments [Abstract] | |||||
Number of reportable segments | 2 | ||||
Segment Reporting Information [Line Items] | |||||
Net sales | $60,941 | $60,705 | $198,456 | $190,343 | |
Net earnings (loss) attributable to Twin Disc | 2,946 | -475 | 10,736 | 1,320 | |
Assets | 246,376 | 246,376 | 266,985 | ||
Corporate and Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net earnings (loss) attributable to Twin Disc | -1,984 | -1,982 | -6,354 | -7,160 | |
Assets | -57,340 | -57,340 | -44,900 | ||
Manufacturing Segment [Member] | Inter/Intra Segment Elimination [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | -16,441 | -18,233 | -50,902 | -54,452 | |
Manufacturing Segment [Member] | Reportable Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 54,519 | 52,957 | 178,143 | 163,224 | |
Net earnings (loss) attributable to Twin Disc | 3,589 | -9 | 12,793 | 3,662 | |
Assets | 247,531 | 247,531 | 254,652 | ||
Distribution Segment [Member] | Inter/Intra Segment Elimination [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | -3,398 | -2,460 | -8,032 | -8,447 | |
Distribution Segment [Member] | Reportable Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 26,261 | 28,441 | 79,247 | 90,018 | |
Net earnings (loss) attributable to Twin Disc | 1,341 | 1,516 | 4,297 | 4,818 | |
Assets | $56,185 | $56,185 | $57,233 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 | Jun. 30, 2014 | |
Performance Stock Unit Awards [Member] | |||||
Schedule of Share Based Compensation Arrangements by Options Activity and Exercise Price Range [Line Items] | |||||
Stock awards granted (in shares) | 15,861 | 43,154 | |||
Stock awards vesting period | 3 years | 3 years | |||
Number of shares of common stock that can be granted, maximum (in shares) | 13,621 | 22,205 | 13,621 | 22,205 | |
Unvested stock awards outstanding (in shares) | 48,594 | 54,874 | 48,594 | 54,874 | |
Compensation cost, recognized | $0 | $0 | $0 | $0 | |
Weighted average grant date fair value of unvested awards (in dollars per share) | $24.70 | $24.70 | |||
Total fair value of stock awards vested | 0 | 0 | |||
Accrued liabilities, employee benefits | 0 | 0 | 0 | ||
Unrecognized compensation expense related to unvested shares | 847,000 | 847,000 | |||
Performance Stock Awards [Member] | |||||
Schedule of Share Based Compensation Arrangements by Options Activity and Exercise Price Range [Line Items] | |||||
Stock awards granted (in shares) | 16,261 | 17,312 | |||
Stock awards vesting period | 3 years | 3 years | |||
Number of shares of common stock that can be granted, maximum (in shares) | 14,101 | 17,038 | 14,101 | 17,038 | |
Unvested stock awards outstanding (in shares) | 51,478 | 59,453 | 51,478 | 59,453 | |
Compensation cost, recognized | 0 | 0 | 0 | 0 | |
Weighted average grant date fair value of unvested awards (in dollars per share) | $24.04 | $24.04 | |||
Total fair value of stock awards vested | 0 | 0 | |||
Unrecognized compensation expense related to unvested shares | 1,238,000 | 1,238,000 | |||
Restricted Stock [Member] | |||||
Schedule of Share Based Compensation Arrangements by Options Activity and Exercise Price Range [Line Items] | |||||
Stock awards granted (in shares) | 57,216 | 51,004 | |||
Unvested stock awards outstanding (in shares) | 97,789 | 119,297 | 97,789 | 119,297 | |
Compensation cost, recognized | 8,000 | 308,000 | 425,000 | 934,000 | |
Total fair value of stock awards vested | 941,000 | 3,053,000 | |||
Unrecognized compensation expense related to unvested shares | $1,227,000 | $1,227,000 | |||
Recognition period for unrecognized compensation expense | 3 years | ||||
Restricted Stock [Member] | Minimum [Member] | |||||
Schedule of Share Based Compensation Arrangements by Options Activity and Exercise Price Range [Line Items] | |||||
Stock awards vesting period | 1 year | ||||
Restricted Stock [Member] | Maximum [Member] | |||||
Schedule of Share Based Compensation Arrangements by Options Activity and Exercise Price Range [Line Items] | |||||
Stock awards vesting period | 4 years |
Pension_and_Other_Postretireme2
Pension and Other Postretirement Benefit Plans (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 |
Components of Net Periodic Benefit Cost [Abstract] | ||||
Benefit plan adjustments reclassified from accumulated other comprehensive loss | $542 | $528 | $1,545 | $1,506 |
Tax on reclassified benefit plan adjustments from accumulated other comprehensive loss | 322 | 354 | 917 | 1,060 |
Pension Benefits [Member] | ||||
Components of Net Periodic Benefit Cost [Abstract] | ||||
Service cost | 120 | 135 | 359 | 402 |
Interest cost | 1,215 | 1,357 | 3,661 | 4,068 |
Expected return on plan assets | -2,105 | -1,648 | -5,469 | -4,942 |
Amortization of transition obligation | 10 | 19 | 29 | 57 |
Amortization of net actuarial loss | 607 | 714 | 1,825 | 2,141 |
Net periodic benefit cost | -153 | 577 | 405 | 1,726 |
Expected contributions to its pension plan in 2015 | 6,172 | |||
Contributions made during period | 5,562 | |||
Postretirement Benefits [Member] | ||||
Components of Net Periodic Benefit Cost [Abstract] | ||||
Service cost | 8 | 9 | 23 | 28 |
Interest cost | 144 | 165 | 434 | 494 |
Amortization of net actuarial loss | 160 | 150 | 478 | 451 |
Net periodic benefit cost | $312 | $324 | $935 | $973 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 9 Months Ended | |
Mar. 27, 2015 | Mar. 28, 2014 | |
Income Taxes [Abstract] | ||
Effective income tax rate (in hundredths) | 31.80% | 66.60% |
Income Tax Examination [Line Items] | ||
Unrecognized tax benefits if recognized would favorably impact effective tax rate | $835,000 | |
Increase in domestic earnings | $7,100,000 | |
Italy, Canada, Belgium, and Japan [Member] | ||
Income Tax Examination [Line Items] | ||
Tax years that remain subject to examination | 2009 through 2014 | |
U.S. [Member] | ||
Income Tax Examination [Line Items] | ||
Tax years that remain subject to examination | subsequent to fiscal 2011 |
Goodwill_and_Other_Intangibles2
Goodwill and Other Intangibles (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 | Jun. 30, 2014 | |
Intangible assets with finite lives [Abstract] | |||||
Gross Carrying Amount | $13,291,000 | $13,291,000 | $13,634,000 | ||
Accumulated Amortization | -9,960,000 | -9,960,000 | -9,783,000 | ||
Accumulated Impairment | -1,277,000 | -1,277,000 | |||
Net Book Value | 2,054,000 | 2,054,000 | 2,574,000 | ||
Goodwill [Roll Forward] | |||||
Gross Carrying Amount | 16,488,000 | 16,488,000 | 17,133,000 | ||
Accumulated Impairment | -3,670,000 | -3,670,000 | -3,670,000 | ||
Translation adjustment | -645,000 | ||||
Net Book Value | 12,818,000 | 12,818,000 | 13,463,000 | ||
Intangible amortization expense | 56,000 | 121,000 | 177,000 | 356,000 | |
Estimated intangible amortization expense [Abstract] | |||||
2015 | 55,000 | 55,000 | |||
2016 | 147,000 | 147,000 | |||
2017 | 143,000 | 143,000 | |||
2018 | 143,000 | 143,000 | |||
2019 | 143,000 | 143,000 | |||
2020 | 143,000 | 143,000 | |||
Carrying amount of indefinite lived intangible assets, gross | 210,000 | 210,000 | 223,000 | ||
Weighted average remaining useful life | 16 years | ||||
Licensing agreements [Member] | |||||
Intangible assets with finite lives [Abstract] | |||||
Gross Carrying Amount | 3,015,000 | 3,015,000 | 3,015,000 | ||
Accumulated Amortization | -2,490,000 | -2,490,000 | -2,445,000 | ||
Accumulated Impairment | 0 | 0 | |||
Net Book Value | 525,000 | 525,000 | 570,000 | ||
Non-compete agreements [Member] | |||||
Intangible assets with finite lives [Abstract] | |||||
Gross Carrying Amount | 2,128,000 | 2,128,000 | 2,128,000 | ||
Accumulated Amortization | -2,045,000 | -2,045,000 | -2,045,000 | ||
Accumulated Impairment | -83,000 | -83,000 | |||
Net Book Value | 0 | 0 | 0 | ||
Trade name [Member] | |||||
Intangible assets with finite lives [Abstract] | |||||
Gross Carrying Amount | 1,675,000 | 1,675,000 | 2,009,000 | ||
Accumulated Amortization | -169,000 | -169,000 | -100,000 | ||
Accumulated Impairment | 0 | 0 | |||
Net Book Value | 1,506,000 | 1,506,000 | 1,909,000 | ||
Other [Member] | |||||
Intangible assets with finite lives [Abstract] | |||||
Gross Carrying Amount | 6,473,000 | 6,473,000 | 6,482,000 | ||
Accumulated Amortization | -5,256,000 | -5,256,000 | -5,193,000 | ||
Accumulated Impairment | -1,194,000 | -1,194,000 | |||
Net Book Value | $23,000 | $23,000 | $95,000 |
Longterm_Debt_Details
Long-term Debt (Details) (USD $) | 9 Months Ended | 12 Months Ended |
Mar. 27, 2015 | Jun. 30, 2014 | |
Quarter | ||
Debt Instrument [Line Items] | ||
Subtotal | $12,400,000 | $18,404,000 |
Less: current maturities and short-term borrowings | -3,571,000 | -3,604,000 |
Total long-term debt | 8,829,000 | 14,800,000 |
Number of recent quarters considered for minimum EBITDA | 4 | |
US treasury yield curve rate (in hundredths) | 0.92% | 0.88% |
Add-on-to reference rate to calculate discount rate (in hundredths) | 1.00% | 1.00% |
Total rate of interest (in hundredths) | 1.92% | 1.88% |
Revolving Loan [Member] | ||
Debt Instrument [Line Items] | ||
Subtotal | 5,235,000 | 11,200,000 |
10-year Unsecured Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Subtotal | 7,143,000 | 7,143,000 |
Maturity period of unsecured senior notes | 10 years | |
Maturity date of note agreement | 10-Apr-16 | |
Fair value of long term debt | 7,385,000 | 7,605,000 |
Other [Member] | ||
Debt Instrument [Line Items] | ||
Subtotal | $22,000 | $61,000 |
Shareholders_Equity_Details
Shareholders' Equity (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 | Jun. 30, 2013 | Jun. 30, 2012 | Jul. 27, 2012 | Feb. 01, 2008 |
Stockholders Equity [Line Items] | ||||||||
Balance, beginning of period | $152,311 | $143,562 | ||||||
Net income | 3,047 | -442 | 10,909 | 1,488 | ||||
Translation adjustments | -5,892 | 1,054 | -14,762 | 4,053 | ||||
Benefit plan adjustments, net of tax | 542 | 528 | 1,545 | 1,506 | ||||
Cash dividends | -3,266 | -3,532 | ||||||
Compensation expense and windfall tax benefits | 388 | 1,457 | ||||||
Shares (acquired) issued, net | -298 | -2,169 | ||||||
Balance, end of period | 146,827 | 146,365 | 146,827 | 146,365 | ||||
Common Stock [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Number of shares authorize to repurchase (in shares) | 375,000 | 500,000 | ||||||
Stock repurchased during period (in shares) | 185,000 | 125,000 | ||||||
Balance, beginning of period | 11,973 | 13,183 | ||||||
Compensation expense and windfall tax benefits | 388 | 1,457 | ||||||
Shares (acquired) issued, net | -392 | -2,964 | ||||||
Balance, end of period | 11,969 | 11,676 | 11,969 | 11,676 | 13,183 | |||
Retained Earnings [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Balance, beginning of period | 183,695 | 184,110 | ||||||
Net income | 10,736 | 1,320 | ||||||
Cash dividends | -3,047 | -3,045 | ||||||
Balance, end of period | 191,384 | 182,385 | 191,384 | 182,385 | ||||
Accumulated Other Comprehensive Income (Loss) [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Balance, beginning of period | -15,943 | -25,899 | ||||||
Translation adjustments | -14,676 | 4,137 | ||||||
Benefit plan adjustments, net of tax | 1,545 | 1,506 | ||||||
Balance, end of period | -29,074 | -20,256 | -29,074 | -20,256 | ||||
Treasury Stock [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Balance, beginning of period | -28,141 | -28,890 | ||||||
Shares (acquired) issued, net | 94 | 795 | ||||||
Balance, end of period | -28,047 | -28,095 | -28,047 | -28,095 | ||||
Non-Controlling Interest [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Balance, beginning of period | 727 | 1,058 | ||||||
Net income | 173 | 168 | ||||||
Translation adjustments | -86 | -84 | ||||||
Cash dividends | -219 | -487 | ||||||
Balance, end of period | $595 | $655 | $595 | $655 |
Shareholders_Equity_Accumulate
Shareholders' Equity, Accumulated Other Comprehensive Income (Loss) (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | |||||||||
In Thousands, unless otherwise specified | Mar. 27, 2015 | Mar. 28, 2014 | Mar. 27, 2015 | Mar. 28, 2014 | Dec. 26, 2014 | Sep. 26, 2014 | Dec. 27, 2013 | Sep. 27, 2013 | ||||
Reconciliation for the changes in accumulated other comprehensive income (loss), net of tax, by component [Roll Forward] | ||||||||||||
Balance, beginning of period | ($15,943) | ($15,943) | ||||||||||
Balance, end of period | -29,074 | -29,074 | ||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Tax benefit | 707 | -188 | 5,088 | 2,973 | ||||||||
Total reclassification net of tax | 3,047 | -442 | 10,909 | 1,488 | ||||||||
Translation Adjustment [Member] | ||||||||||||
Reconciliation for the changes in accumulated other comprehensive income (loss), net of tax, by component [Roll Forward] | ||||||||||||
Balance, beginning of period | 11,941 | 19,988 | 20,779 | 16,949 | 16,442 | 20,779 | 18,875 | 16,949 | ||||
Other comprehensive loss before reclassifications | -5,838 | 1,098 | -4,501 | -4,337 | 1,113 | 1,926 | ||||||
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | 0 | 0 | 0 | 0 | ||||||
Net current period other comprehensive income | -5,838 | 1,098 | -4,501 | -4,337 | 1,113 | 1,926 | ||||||
Balance, end of period | 6,103 | 21,086 | 6,103 | 21,086 | 11,941 | 16,442 | 19,988 | 18,875 | ||||
Benefit Plans Adjustment [Member] | ||||||||||||
Reconciliation for the changes in accumulated other comprehensive income (loss), net of tax, by component [Roll Forward] | ||||||||||||
Balance, beginning of period | -35,719 | -41,870 | -36,722 | -42,848 | -36,234 | -36,722 | -42,398 | -42,848 | ||||
Other comprehensive loss before reclassifications | 54 | 15 | 27 | 0 | 14 | -62 | ||||||
Amounts reclassified from accumulated other comprehensive income | 488 | 513 | 488 | 488 | 514 | 512 | ||||||
Net current period other comprehensive income | 542 | 528 | 515 | 488 | 528 | 450 | ||||||
Balance, end of period | -35,177 | -41,342 | -35,177 | -41,342 | -35,719 | -36,234 | -41,870 | -42,398 | ||||
Benefit Plans Adjustment [Member] | Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Actuarial losses | 767 | [1] | 864 | [1] | 2,303 | [1] | 2,592 | [1] | ||||
Transition asset and prior service benefit | 10 | 19 | 29 | 57 | ||||||||
Total before tax benefit | 777 | 883 | 2,332 | 2,649 | ||||||||
Tax benefit | 289 | 370 | 868 | 1,110 | ||||||||
Total reclassification net of tax | $488 | $513 | $1,464 | $1,539 | ||||||||
[1] | These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note G "Pension and Other Postretirement Benefit Plans" for further details). |
Restructuring_of_Operations_De
Restructuring of Operations (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Mar. 27, 2015 | Mar. 28, 2014 | Sep. 27, 2013 | Jun. 30, 2013 | Mar. 27, 2015 | Mar. 28, 2014 | Jun. 30, 2014 | |
Restructuring of Operations [Abstract] | |||||||
Pre-tax restructuring charge | $0 | $0 | $1,094,000 | $548,000 | $0 | $1,094,000 | |
Cash payments | 17,000 | 857,000 | |||||
Accrual balance of restructuring charge | 610,000 | 610,000 | 785,000 | ||||
Foreign exchange impact | $158,000 |