Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 03, 2015 | Jun. 30, 2014 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | LMI AEROSPACE INC | ||
Entity Central Index Key | 1059562 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $144,084,582 | ||
Entity Common Stock, Shares Outstanding | 13,134,741 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $7,927 | $1,572 |
Trade accounts receivable, net | 58,234 | 72,853 |
Inventories | 114,279 | 113,178 |
Prepaid expenses and other current assets | 10,255 | 4,411 |
Deferred income taxes | 3,913 | 2,693 |
Total current assets | 194,608 | 194,707 |
Property, plant and equipment, net | 99,482 | 103,375 |
Goodwill | 86,784 | 113,223 |
Intangible assets, net | 50,940 | 55,465 |
Other assets | 10,622 | 13,281 |
Total assets | 442,436 | 480,051 |
Current liabilities: | ||
Accounts payable | 21,755 | 19,904 |
Accrued expenses | 26,072 | 18,566 |
Current installments of long-term debt and capital lease obligations | 3,424 | 5,242 |
Total current liabilities | 51,251 | 43,712 |
Long-term debt and capital lease obligations, less current installments | 265,554 | 285,369 |
Other long-term liabilities | 3,289 | 3,915 |
Deferred income taxes | 4,207 | 2,911 |
Total long-term liabilities | 273,050 | 292,195 |
Shareholders’ equity: | ||
Common stock, $0.02 par value per share; authorized 28,000,000 shares; issued 13,089,003 and 12,873,208 shares at December 31, 2014 and December 31, 2013, respectively | 262 | 257 |
Preferred stock, $0.02 par value per share; authorized 2,000,000 shares; none issued at either date | 0 | 0 |
Additional paid-in capital | 95,460 | 92,692 |
Accumulated other comprehensive loss | -170 | -507 |
Treasury stock, at cost, 28,396 shares at December 31, 2014 and 22,321 shares at December 31, 2013 | -359 | -202 |
Retained earnings | 22,942 | 51,904 |
Total shareholders’ equity | 118,135 | 144,144 |
Total liabilities and shareholders’ equity | $442,436 | $480,051 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Shareholders’ equity: | ||
Common stock, par value (in dollars per share) | $0.02 | $0.02 |
Common stock, authorized shares (in shares) | 28,000,000 | 28,000,000 |
Common stock, shares issued (in shares) | 13,089,003 | 12,873,208 |
Preferred stock, par value (in dollars per share) | $0.02 | $0.02 |
Preferred stock, authorized shares (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Treasury stock, at cost (in shares) | 28,396 | 22,321 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||||||
Sales and service revenue | |||||||||||||||||||
Product sales | $321,284 | $324,133 | $168,943 | ||||||||||||||||
Service revenues | 66,533 | 88,424 | 109,686 | ||||||||||||||||
Net sales | 88,794 | 97,335 | 105,937 | 95,751 | 96,370 | 104,656 | 105,465 | 106,066 | 387,817 | 412,557 | 278,629 | ||||||||
Cost of sales and service revenue | |||||||||||||||||||
Cost of product sales | 254,775 | 255,261 | 121,247 | ||||||||||||||||
Cost of service revenues | 57,672 | 77,434 | 89,074 | ||||||||||||||||
Cost of sales | 312,447 | 332,695 | 210,321 | ||||||||||||||||
Gross profit | 16,732 | 22,043 | [1] | 19,134 | 17,461 | 17,549 | 20,418 | 21,841 | 20,054 | [2] | 75,370 | 79,862 | 68,308 | ||||||
Selling, general and administrative expenses | 55,204 | 55,862 | 36,891 | ||||||||||||||||
Goodwill and intangible asset impairment | 26,439 | 77,750 | 0 | ||||||||||||||||
Contingent consideration write-off | -7,950 | 0 | -7,950 | [3] | 0 | ||||||||||||||
Restructuring expense | 2,585 | 3,073 | 0 | ||||||||||||||||
Acquisitions expense | 0 | 247 | 5,362 | ||||||||||||||||
(Loss) income from operations | -8,858 | -49,120 | 26,055 | ||||||||||||||||
Other income (expense): | |||||||||||||||||||
Interest expense | -29,280 | -16,962 | -1,771 | ||||||||||||||||
Other, net | 223 | 618 | 356 | ||||||||||||||||
Total other expense | -29,057 | -16,344 | -1,415 | ||||||||||||||||
(Loss) income before income taxes | -37,915 | -65,464 | 24,640 | ||||||||||||||||
(Benefit) provision for income taxes | -6,396 | -8,953 | -6,979 | 8,153 | |||||||||||||||
Net (loss) income | -22,505 | [4] | 1,396 | [1] | -7,411 | [5] | -442 | [6] | -67,061 | [7] | 2,075 | 4,664 | [8] | 1,837 | [2] | -28,962 | -58,485 | 16,487 | |
Other comprehensive income (loss): | |||||||||||||||||||
Change in foreign currency translation adjustment | -98 | -23 | -49 | ||||||||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings, net of tax of $157, $0 and $0 | 278 | 0 | 0 | ||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, ($157), and $0 | 0 | -278 | 0 | ||||||||||||||||
Total comprehensive (loss) income | ($28,782) | ($58,786) | $16,438 | ||||||||||||||||
Amounts per common share: | |||||||||||||||||||
Net (loss) income per common share (in dollars per share) | ($1.76) | [4] | $0.11 | [1] | ($0.58) | [5] | ($0.03) | [6] | ($5.31) | [7] | $0.16 | $0.37 | [8] | $0.15 | [2] | ($2.28) | ($4.64) | $1.41 | |
Net (loss) income per common share assuming dilution (in dollars per share) | ($1.76) | [4] | $0.11 | [1] | ($0.58) | [5] | ($0.03) | [6] | ($5.31) | [7] | $0.16 | $0.37 | [8] | $0.14 | [2] | ($2.28) | ($4.64) | $1.39 | |
Weighted average common shares outstanding (in shares) | 12,716,976 | 12,607,833 | 11,701,607 | ||||||||||||||||
Weighted average dilutive common shares outstanding (in shares) | 12,716,976 | 12,607,833 | 11,839,182 | ||||||||||||||||
[1] | Gross profit in the third quarter of 2014 includes a $5,286 favorable cumulative catch-up adjustment related to the settlement of an unpriced change order and the Company's ability to secure more favorable future material pricing on a long-term production contract. In addition, net income in the third quarter of 2014 includes $765 of restructuring expenses. | ||||||||||||||||||
[2] | The first quarter of 2013 included $2,497 of non-recurring inventory step-up related to the Valent acquisition. | ||||||||||||||||||
[3] | The Monte Carlo simulation was used with a normal probability distribution of the best estimate of EBITDA for 2013 to approximate fair value. At June 30, 2013, the EBITDA target was not expected to occur and, as such, the $7,950 of contingent consideration was deemed unlikely to be paid, and a benefit was recorded on a separate line in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | ||||||||||||||||||
[4] | Net loss in the fourth quarter of 2014 includes a $26,439 goodwill impairment charge related to the Engineering Services reporting unit, $228 of restructuring expenses and a $6,396 income tax benefit resulting from the decision to carry the 2014 tax loss back to previous years. | ||||||||||||||||||
[5] | Net loss in the second quarter of 2014 includes $793 of interest expense related to the termination of interest rate derivatives and $8,340 related to the write-off of debt issuance costs associated with the modification of the Company's revolving credit facility and the termination of its long-term credit agreement. Net loss in the second quarter of 2014 also includes $1,095 of restructuring expenses. | ||||||||||||||||||
[6] | Included in the net loss for the the first quarter of 2014 were $428 of restructuring expenses. | ||||||||||||||||||
[7] | The fourth quarter of 2013 included a goodwill impairment charge of $73,528 related to the Valent acquisition, $17,718 related to income tax valuation allowance, $2,620 related to a separation agreement reached with key members of Valent Aerostructures, LLC. and $453 of restructuring expenses related to the closure of the Precise Machine facility. In addition, Valent gross profit was unfavorably impacted by $955 in cumulative catch-up adjustments, the result of higher levels of indirect costs required to meet customer demand. | ||||||||||||||||||
[8] | The second quarter of 2013 included a trade name impairment of $4,222 related to D3 Technologies offset by a contingent consideration write-off of $7,950 related to Valent. |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (USD $) | Total | Common Stock [Member] | Additional Paid-In Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
In Thousands, unless otherwise specified | ||||||
Balance at Dec. 31, 2011 | $167,785 | $242 | $74,823 | ($1,182) | $93,902 | $0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 16,487 | 16,487 | ||||
Other comprehensive income (loss) | -49 | -49 | ||||
Issuance of stock | ||||||
Shares of restricted stock | 0 | -515 | 515 | |||
401k plan contribution | 793 | 582 | 211 | |||
783,798 shares for Valent acquisition | 15,000 | 16 | 14,984 | |||
Restricted stock compensation | 1,494 | 1,494 | ||||
Other | -556 | -1 | -529 | -26 | ||
Balance at Dec. 31, 2012 | 200,954 | 257 | 90,839 | -482 | 110,389 | -49 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | -58,485 | -58,485 | ||||
Other comprehensive income (loss) | -458 | -458 | ||||
Issuance of stock | ||||||
Shares of restricted stock | 0 | -237 | 237 | |||
401k plan contribution | 901 | 707 | 194 | |||
Restricted stock compensation | 1,615 | 1,615 | ||||
Other | -383 | 0 | -232 | -151 | ||
Balance at Dec. 31, 2013 | 144,144 | 257 | 92,692 | -202 | 51,904 | -507 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | -28,962 | -28,962 | ||||
Other comprehensive income (loss) | 337 | 337 | ||||
Issuance of stock | ||||||
Shares of restricted stock | -249 | 4 | -38 | -215 | ||
Stock Issued During Period, Value, Issued for Services | 167 | 109 | 58 | |||
401k plan contribution | 848 | 1 | 847 | 0 | ||
Restricted stock compensation | 1,850 | 1,850 | 0 | |||
Balance at Dec. 31, 2014 | $118,135 | $262 | $95,460 | ($359) | $22,942 | ($170) |
CONSOLIDATED_STATEMENTS_OF_SHA1
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Statement of Stockholders' Equity [Abstract] | |||
Stock Issued During Period, Shares, Issued for Services | 12,175 | ||
Issuance of stock | |||
Shares in connection with exercise of options (in shares) | |||
Shares of restricted stock (in shares) | 142,588 | 67,996 | 108,646 |
Shares in connection with Valent acquisition (in shares) | 783,798 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Operating activities: | |||
Net (loss)/income | ($28,962) | ($58,485) | $16,487 |
Adjustments to reconcile net income to net cash provided/(used) by operating activities: | |||
Depreciation and amortization | 22,459 | 20,560 | 7,994 |
Goodwill and intangible asset impairment | 26,439 | 77,750 | 0 |
Contingent consideration write-off | 0 | 7,950 | 0 |
Share-based Compensation | 2,018 | 1,615 | 1,494 |
Write off of Deferred Debt Issuance Cost | 8,466 | 0 | 0 |
payments for hedge, operating activities | -793 | 0 | 0 |
Deferred taxes | 76 | -6,060 | -1,062 |
Other non-cash items | 686 | -420 | -317 |
Changes in operating assets and liabilities, net of acquired businesses: | |||
Trade accounts receivable | 14,270 | -4,678 | -8,093 |
Inventories | -1,101 | -23,063 | -10,980 |
Prepaid expenses and other assets | 2,264 | 2,828 | 1,186 |
Current income taxes | -5,908 | 1,939 | -1,168 |
Accounts payable | 307 | -10,760 | 3,062 |
Accrued expenses | 8,896 | -1,625 | 196 |
Net cash provided/(used) by operating activities | 49,117 | -8,349 | 8,799 |
Investing activities: | |||
Additions to property, plant and equipment | -16,690 | -23,738 | -18,783 |
Acquisitions, net of cash acquired | 0 | -504 | -216,398 |
Proceeds from sale of equipment | 3,579 | 1,989 | 181 |
Net cash used by investing activities | -13,111 | -22,253 | -235,000 |
Financing activities: | |||
Proceeds from issuance of debt | 250,000 | 5,751 | 229,124 |
Principal payments on long-term debt and notes payable | -235,633 | -5,863 | -118 |
Advances on revolving line of credit | 66,000 | 107,000 | 40,278 |
Payments on revolving line of credit | -102,000 | -77,236 | -34,042 |
Prepaid financing costs | -8,018 | -1,817 | -12,736 |
Other, net | 0 | -8 | 174 |
Net cash (used)/provided by financing activities | -29,651 | 27,827 | 222,680 |
Net increase/(decrease) in cash and cash equivalents | 6,355 | -2,775 | -3,521 |
Cash and cash equivalents, beginning of year | 1,572 | 4,347 | 7,868 |
Cash and cash equivalents, end of year | 7,927 | 1,572 | 4,347 |
Cash payments for: | |||
Interest paid | 7,388 | 13,161 | 585 |
Income taxes paid, net of refunds received | -3,037 | -2,683 | 10,261 |
Supplemental disclosure of non-cash transactions: | |||
Fair value of common stock issued to acquire Valent | 0 | 0 | 15,000 |
Contingent consideration | 0 | -7,950 | 7,950 |
Equipment acquired under capital lease | $0 | $411 | $746 |
ACCOUNTING_POLICIES
ACCOUNTING POLICIES | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
ACCOUNTING POLICIES | ACCOUNTING POLICIES | ||||||||
Principles of Consolidation | |||||||||
The Consolidated Financial Statements included in this report have been prepared by management of LMI Aerospace, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. | |||||||||
Use of Estimates | |||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions. These estimates and assumptions affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from these estimates. | |||||||||
Revenue and Profit Recognition | |||||||||
Except as described below, the Company recognizes revenue for sales of products and related services in accordance with Financial Accounting Standards Board, (“FASB”) Accounting Standards Codification (“ASC”) Topic 605-15 Products and Topic 605-20 Services. The Company sells products under long term supply contracts and purchase orders where the product is built to the customer specifications based on firm purchase orders from the customer. The purchase orders tend to be of a relatively short duration and customers place orders on a periodic basis. The pricing is generally fixed for some length of time and the quantities are based on individual purchase orders. Revenue is recognized when title passes and services are rendered, the price is fixed or determinable, and collection is reasonably assured. Approximately 80.0% to 90.0% of the total revenue the Company recognized in any given quarter is accounted for in accordance with Topics 15 and 20. The remainder of the revenue is accounted for using methods consistent with ASC Topic 605-35 Construction-Type and Production-Type Contracts. | |||||||||
The percentage of completion method used to account for contracts depends on the nature of the products provided under the contract. For example, for contracts that require us to perform a significant level of development effort, in comparison to the total value of the contract, sales are recorded using the cost to cost method to measure progress toward completion. Under the cost to cost method of accounting, we recognize sales and estimated profit as costs are incurred based on the proportion that the incurred costs bare compared to total estimated costs. For contracts that require us to provide a substantial number of similar items without a significant level of development, we record sales and estimated profit on a percentage of completion basis using units of delivery as the basis to measure progress toward completing the contract. Under both methods, profit recognized is based on the total expected profit margin percentage multiplied by revenue recognized to date. | |||||||||
The Company periodically reviews all estimates to complete as required by the authoritative guidance and the estimated total cost and expected gross profit are revised as required over the life of the contract. Any revisions to the estimated total cost are accounted for as a change of an estimate. A cumulative catch-up adjustment is recorded in the period of the change of the estimated costs to complete the contract. | |||||||||
In addition, should total estimated costs at completion exceed the estimated total revenue, the anticipated full loss is recognized in the period in which the anticipated loss is determined. The loss is reported as a component of cost of sales. The Company does not have any cost to cost contracts with an anticipated loss. At December 31, 2013, the Company had a contract accounted for using the units of delivery method which was acquired during the Valent acquisition and where estimated costs exceeded the total contract revenue. The provision for anticipated loss was established in 2013 for $5,267 and was treated as a measurement period change and as such increased the goodwill related to the Valent acquisition. During the third quarter of 2014, a change was agreed to that resulted in the favorable settlement of an unpriced change order related to this contract. In addition, the Company secured more favorable future material pricing with respect to this contract as engineering changes to the related assemblies had stabilized. As a result, contract costs are no longer expected to exceed revenue and the remaining related loss reserve was reversed, resulting in a favorable cumulative catch up adjustment of $5,267 in the year ended December 31, 2014. The reversal was recorded in the cost of goods sold section of the Consolidated Statements of Comprehensive Income (Loss). | |||||||||
Cumulative catch-up adjustments had the following impact to operating income in the years presented: | |||||||||
2014 | 2013 | 2012 | |||||||
Favorable adjustments | 5,720 | 106 | 587 | ||||||
Unfavorable adjustments | (1,719 | ) | (1,609 | ) | (519 | ) | |||
Net operating income adjustments | 4,001 | (1,503 | ) | 68 | |||||
The net favorable cumulative catch-up adjustments in 2014 relate primarily to two contracts. The favorable adjustments are primarily associated with the aforementioned Valent contract of $5,267. The unfavorable cumulative catch-up adjustments recorded in 2014 primarily relate to unforeseen failures during the test phase of a design program on the Mitsubishi Regional Jet. The adjustment related to this program was $1,479 and was recorded as a reduction to revenue in the Consolidated Statements of Comprehensive Income (Loss). | |||||||||
The negative cumulative catch-up adjustments in 2013 relate primarily to two contracts. The first contract relates to a design program for 787 shipping fixtures on which the Company was unable to pass through as much of the engineering changes incurred to the customer as originally estimated. The Company recorded a reduction of contact revenue of $811 for this program in 2013. The second contract relates to the design portion of the Embraer KC-390 program. In 2013, an adjustment of $706 was recorded to reflect a revision in the expected labor hours necessary to complete the program. | |||||||||
For contracts accounted for using the percentage of completion method, management’s estimates of total units to be produced, and material, labor and overhead costs on long-term contracts are critical to the Company. Due to the size, length of time and nature of many of our contracts, the estimation of revenue and costs through completion is complicated and subject to many variables. Claims and unpriced change orders will impact the estimate of total revenues and profits. In the ordinary course of business, the Company may receive requests from its customers to perform tasks not specified in its contracts. When this occurs on a long-term contract using the cost-to-cost method of percentage of completion accounting, the Company may record revenue for claims or unpriced change orders to be negotiated with customers. Approximately 0.1% of the Company's revenue recognized in 2014 represented amounts associated with claims and unpriced change orders. Total contract cost estimates are largely based our current cost of production, purchase order terms negotiated or estimated by our supply chain. | |||||||||
The development of a contract revenue and gross margin percentage involves utilization of detailed procedures by a team of operational and financial personnel that provides information on the status of the contracts. Estimates of revenue and costs associated with each significant contract are reviewed and approved by the team on a quarterly basis. | |||||||||
Due to the significance of the judgment in the estimation process described above, it is possible that materially different margins could be recorded if we used different assumptions or if the underlying circumstances were to change. | |||||||||
Pre-Contract and Pre-Production Costs under Long-Term Supply Contracts | |||||||||
In certain circumstances, the Company capitalizes costs incurred prior to the execution of a contract with the customer. These circumstances are limited to instances in which the Company has substantially negotiated the terms and conditions of the anticipated contract with its customers and concluded that their recoverability from the anticipated contract is probable. As these costs are directly associated with a specific anticipated contract and they are concluded to be recoverable under that anticipated contract, the Company has capitalized these amounts. | |||||||||
The Company may incur design and development costs prior to the production phase of contracts that are outside the scope of the contract accounting method. These pre-production costs are generally related to costs the Company incurs to design and build tooling that is owned by the customer and design and engineering services. The Company receives the non-cancellable right to use these tools to build the parts as specified in a contractual agreement and therefore has capitalized these costs. In certain instances, the Company enters into agreements with its customers that provide it a contractual guarantee for reimbursement of design and engineering services incurred prior to the production phase of a contract. Due to the contractual guarantee, the Company capitalizes the costs of these services. The pre-production costs are amortized to cost of sales over the shorter of the life of the contractual agreement or the related tooling. | |||||||||
Cash and Cash Equivalents | |||||||||
Cash and cash equivalents include cash on hand, deposits in transit and all highly liquid investment instruments with an initial maturity of three months or less. | |||||||||
Inventories | |||||||||
The Company’s inventories are stated at the lower of cost or market and utilize actual costs for raw materials and average or standard cost (which approximates actual cost) for work in process, manufactured and purchased components and finished goods. The Company evaluates the inventory carrying value and reduces the carrying costs based on customer activity, estimated future demand, price deterioration, and other relevant information. The Company’s customer demand is unpredictable and may fluctuate due to factors beyond the Company’s control. In addition, inventoried costs include capitalized contract costs relating to programs and contracts with long-term production cycles, a portion of which is not expected to be realized within one year. See further discussion regarding deferred long-term contract costs under “Revenue and Profit Recognition” and “Pre-Contract and Pre-Production Costs under Long-Term Supply Contracts.” | |||||||||
Allowance for Doubtful Accounts | |||||||||
The allowance for doubtful accounts receivable reflects the Company’s best estimate of probable losses inherent in its accounts receivable. The basis used to determine this value is derived from historical experience, specific allowances for known troubled customers and other known information. | |||||||||
Property, Plant and Equipment | |||||||||
Property, plant and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful lives of the assets. Estimated useful lives for buildings, machinery and equipment, and purchased software are 20 to 35 years, 4 to 10 years and 3 to 4 years, respectively. Amortization incurred under capital leases is reported with depreciation expense. | |||||||||
Long Lived Assets | |||||||||
Long lived assets held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. | |||||||||
Goodwill and Intangible Assets | |||||||||
The Company’s acquisitions involve the purchase of tangible and intangible assets and the assumption of certain liabilities. As part of the purchase price allocation, the Company allocates the purchase price to the tangible assets acquired and liabilities assumed based on estimated fair market values, and the remainder of the purchase price is allocated to intangibles and goodwill. Goodwill and intangible assets with indefinite lives are not amortized but are subject to an impairment assessment at least annually in relation to their fair value. Under guidelines established by FASB ASC Topic 280, the Company operates in two operating segments. However, the Company has recorded its goodwill and conducts testing for potential goodwill impairment at a reporting unit level. The reporting units represent a business for which discrete financial information is available, and segment management regularly reviews the operating results. As part of this process, the Company first assesses qualitatively whether it is necessary to perform the quantitative test. The qualitative assessment involves evaluating relevant events or circumstances to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If it is, the Company can bypass the quantitative assessment of goodwill. If it is not, or if the Company has elected to bypass the qualitative assessment process, the quantitative assessment of goodwill utilizes a two-step process, where the carrying value of the reporting unit is compared to its fair value. If the carrying value is less than the fair value, no impairment exists, and the second step is not performed. However, if the carrying value is greater than the fair value, the second step is performed. An impairment charge would be recognized for the amount that the carrying value of the goodwill exceeds its fair value. The fair values for goodwill testing are estimated using a combination of the income and market approach unless circumstances indicate that a better estimate of fair value is available. The income approach utilizes the discounted cash flow model (“DCF model”) and the market approach is based on the market data for a group of guideline companies. | |||||||||
Deferred Gain on Sale of Real Estate | |||||||||
On December 28, 2006, the Company entered into an agreement with a third party to sell and lease back certain of its real estate properties for $10,250. The amount of the sale price in excess of book value for these properties of $4,242 was deferred and is being amortized over the 18 year term of the leases on a straight-line basis. | |||||||||
Share-Based Compensation | |||||||||
The Company recognizes compensation expense for share-based payment transactions in the financial statements at their fair value. The expense is measured at the grant date, based on the calculated fair value of the share-based award, and is recognized over the requisite service period (generally the vesting period of the equity award). | |||||||||
Income Taxes | |||||||||
Provisions for federal and state income taxes are calculated on reported net income before income taxes based on current tax law and also include, in the current period, the cumulative effect of any changes in tax rates from those used previously in determining deferred tax assets and liabilities. Such provisions differ from the amounts currently receivable or payable because certain items of income and expense are recognized in different time periods for financial reporting purposes than for income tax purposes. Significant judgment is required in determining income tax provisions and evaluating tax positions. | |||||||||
A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. When determining the amount of net deferred tax assets that are more likely than not to be realized, Management assesses all available positive and negative evidence. This evidence includes, but is not limited to, prior earnings history, expected future earnings, carry-back and carry-forward periods and the feasibility of ongoing tax strategies that could potentially enhance the likelihood of the realization of a deferred tax asset. The weight given to the positive and negative evidence is commensurate with the extent the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses. | |||||||||
Based on these criteria and the relative weighting of both the positive and negative evidence available, and in particular the activity surrounding the Company's significant loss in 2013, management determined that it was necessary to establish a valuation allowance against all of its net U.S. deferred tax assets at December 31, 2013. This determination was made as the Company entered into a cumulative loss position over the three year period ended December 31, 2013 primarily due to recording a goodwill impairment of $73,528 related to Valent. Once the Company entered into a cumulative loss position it had passed the threshold after which there is a presumption that a company should no longer rely solely on projected future income in determining whether the deferred tax asset is more likely than not to be realized. The Company will continue to monitor its deferred tax position and may adjust the valuation allowance, if necessary, for utilization of the underlying deferred tax assets through current taxable income or as available evidence changes. At December 31, 2014, the Company's deferred tax assets remain under a valuation allowance. | |||||||||
The accounting for uncertainty in income taxes requires a more-likely-than-not threshold for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. The Company records a liability for the difference between the benefit recognized and measured for financial statement purposes and the tax position taken or expected to be taken on our tax return. To the extent that management’s assessment of such tax positions changes, the change in estimate is recorded in the period in which the determination is made. | |||||||||
The Company’s unrecognized tax benefits as of December 31, 2014 and 2013 are immaterial. The Company expects no significant increases or decreases in unrecognized tax benefits due to changes in tax positions within one year of December 31, 2014. The Company has no material interest or penalties relating to income taxes recognized on the Consolidated Balance Sheet as of December 31, 2014 and 2013. As of December 31, 2014, returns for calendar years 2011 through 2013 remain subject to examination by the Internal Revenue Service and/or various state tax jurisdictions. In December 2014, the Company was notified that the Internal Revenue Service will examine its federal returns for the 2012 and 2013 tax years. | |||||||||
Financial Instruments | |||||||||
Fair values of the Company’s long-term obligations approximate their carrying values as the applicable interest rates approximate the current market rates or have variable rate characteristics. The Company’s other financial instruments have fair values that approximate their respective carrying values due to their short maturities. | |||||||||
Reclassifications | |||||||||
Certain reclassifications have been made to prior period financial statements in order to conform to current period presentation. | |||||||||
Recent Accounting Pronouncements | |||||||||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). The standard is effective for reporting periods beginning after December 15, 2016 and early adoption is not permitted. The standard will supersede existing revenue recognition guidance, including industry-specific guidance, and will provide companies with a single revenue recognition model for recognizing revenue from contracts with customers. The standard requires revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions. The two permitted transition methods under the new standard are the full retrospective method, in which case the standard would be applied to each prior reporting period presented, or the modified retrospective method, in which case the cumulative effect of applying the standard would be recognized at the date of initial application. The provisions of this new guidance are effective as of the beginning of the Company’s first quarter of 2017. The Company is currently evaluating the transition method to be used and the impact of adoption of this standard on its consolidated financial statements. | |||||||||
In April 2014, the FASB issued ASU 2014-08, "Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." The amendments in this update change the requirements for reporting discontinued operations. A discontinued operation may include a component of an entity or a group of components of an entity, or a business or nonprofit activity. A disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results and when the component or group of components meets the criteria to be classified as held for sale, is disposed by sale or is disposed of by other than by sale (for example, by abandonment or in a distribution to owners in a spinoff). ASU 2014-8 is effective prospectively for fiscal years, and interim reporting periods within those years, beginning after December 15, 2014. The Company has no present activity that would be impacted by this new standard. | |||||||||
In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. Under the new guidance, management will be required to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The provisions of this ASU are effective for annual periods beginning after December 15, 2016, and for annual and interim periods thereafter. |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Business Combinations [Abstract] | ||||
ACQUISITIONS | ACQUISITIONS | |||
On December 28, 2012, the Company acquired all of the outstanding equity of Valent Aerostructures, LLC, (“Valent”), a provider of complex sub-assemblies and machined parts to airframe manufacturers in the commercial aerospace, business and regional, and military industries, is headquartered in Kansas City, Missouri, and was accounted for under the acquisition method of accounting. Concurrent with the acquisition, the Company entered into a credit agreement to fund the majority of the purchase price as described in Note 9. "Long-term Debt and Capital Lease Obligations." The Company also issued $15,000 in restricted common stock. Fifty percent of the shares issued for the acquisition were eligible to be converted in June of 2014, however, the shares have not yet been converted due to open indemnification matters with the former owners of Valent as described in Item 1. Business, Governmental Regulations and Environmental Compliance. Pursuant to their terms, the remaining shares would be eligible for conversion in December 2015, subject to the same indemnification matters. | ||||
The operating results of Valent have been included in the Company’s Aerostructures segment from the date of acquisition and acquisition related costs of $5,107 were included in acquisitions expense. The following table presents unaudited pro-forma consolidated operating results for the Company for the year ended December 31, 2012, as if Valent had been acquired as of the beginning of the periods presented: | ||||
2012 | ||||
Net sales | $ | 386,402 | ||
Net income | 12,899 | |||
The integration of Valent with its business provides synergistic benefits, including increased scale, complementary product offerings, the ability to compete for larger and more complex design-build projects and enhanced project management capabilities, allowing the Company to drive further growth from existing platforms. | ||||
The following table summarizes the final purchase price allocation for Valent at the date of acquisition: | ||||
Cash | $ | 44 | ||
Accounts receivable | 16,769 | |||
Inventory | 28,053 | |||
Prepaid expenses and other current assets | 640 | |||
Fixed assets | 56,075 | |||
Intangible assets | 46,546 | |||
Other long-term assets | 1,576 | |||
Goodwill | 129,816 | |||
Current liabilities assumed | (25,187 | ) | ||
Long-term liabilities assumed | (23,080 | ) | ||
Cost of acquisition | $ | 231,252 | ||
Of the $46,546 of acquired intangible assets, $45,600 was assigned to customer relationships with a weighted average useful life of 20.3 years; and the remaining $946 consists of trade names, trademarks and other intangibles and have a weighted average useful life of 5.5 years. The fair value of the customer relationships was determined using the multi-period excess earnings method. The fair value of trade names and trademarks was determined using the cost method. These assets are being amortized using the straight-line method, which is expected to approximate the pattern of economic benefit of each intangible asset. | ||||
Establishment of the customer relationship asset at Valent considered an ongoing contract in place with Spirit AeroSystems. The terms of the contract do not provide for any minimum volumes to be ordered and include a termination for convenience clause in favor of the customer whereby the customer can exit the relationship with minimal notice. Given the contract with Spirit AeroSystems can be terminated at any time, the Company manages the customer contract-in-place and the customer relationship as an aggregate asset, and we believe the value of the contract-in-place is not separable from the value of the long-standing customer relationship asset. | ||||
The customer relationship with Spirit AeroSystems intangible asset was valued separately from Valent’s other customer relationship intangible assets. As part of the valuation of Valent’s customer relationship with Spirit AeroSystems intangible asset, the contractual nature of the relationship was considered and incorporated into the valuation. The contractual nature of the relationship was a factor in the selected discount rate (used in the multi-period excess earnings method), although the significance of the contract was modest due to the aforementioned contract provisions that provide no meaningful assurances of future business under the contract (i.e., no minimum volumes, and termination for convenience clause). These contractual provisions coupled with our review of historical contract renewal rates led to the life ultimately determined for the intangible asset. | ||||
On August 7, 2012, the Company acquired all of the shares of capital stock of TASS Inc. (“TASS”), an after-market engineering and support services firm. Headquartered in Kirkland, Washington, TASS delivers engineering solutions to aircraft manufacturers, airlines, Maintenance, Repair and Overhaul companies and leasing companies worldwide. The acquisition was funded by internal cash and by entering into a $1,000 note payable and was accounted for under the acquisition method of accounting. The pro-forma operating results, as if the Company had completed the acquisition at the beginning of the periods presented, are not material to the Company’s operations and are not presented. | ||||
Management believes the acquisition of TASS, together with other initiatives, has augmented the Company’s long and successful history with Boeing products and provides the Company with a global presence in the aftermarket engineering arena. TASS also provides the Company the ability to internally source product support for parts manufactured by the Company in the global airline fleet. | ||||
The Company performed a valuation analysis to determine amounts allocated to the acquired assets and assumed liabilities, including various intangible assets. The following table summarizes the purchase price allocation for TASS at the date of acquisition: | ||||
Cash | $ | 617 | ||
Accounts receivable | 1,979 | |||
Other assets | 175 | |||
Fixed assets | 196 | |||
Intangible assets | 2,247 | |||
Goodwill | 6,313 | |||
Current liabilities assumed | (1,247 | ) | ||
Cost of acquisition | $ | 10,280 | ||
Of the $2,247 acquired intangible assets, $1,876 was assigned to customer relationships with a weighted average useful life of 11.9 years; and the remaining $371 consists of trademarks and other intangibles and have a weighted average useful life of 2.9 years. The fair value of the customer relationships was determined using the discounted cash flow method. The fair value of the trademarks was determined using the relief from royalty method. |
ASSETS_AND_LIABILITIES_MEASURE
ASSETS AND LIABILITIES MEASURED AT FAIR VALUE | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||
ASSETS AND LIABILITIES MEASURED AT FAIR VALUE | ASSETS AND LIABILITIES MEASURED AT FAIR VALUE | |||||||||||||||||||
Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy are described below: | ||||||||||||||||||||
Level 1: | Quoted prices in active markets for identical assets or liabilities. | |||||||||||||||||||
Level 2: | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |||||||||||||||||||
Level 3: | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |||||||||||||||||||
The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. There have been no changes in the methodologies used at December 31, 2014. There were no transfers between levels during 2014 and 2013. | ||||||||||||||||||||
2014 | ||||||||||||||||||||
Assets and Liabilities at Fair Value | Total | |||||||||||||||||||
as of December 31, 2014 | Gains | |||||||||||||||||||
Total | (Level 1) | (Level 2) | (Level 3) | (Losses) | ||||||||||||||||
Recurring Fair Value Measurement: | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Interest rate derivatives (1) | $ | — | $ | — | $ | — | $ | — | $ | (793 | ) | |||||||||
Non-recurring Fair Value Measurements: | ||||||||||||||||||||
Asset: | ||||||||||||||||||||
Intangible assets, net (2) | $ | 50,940 | $ | — | $ | — | $ | 50,940 | $ | — | ||||||||||
Goodwill (3) | $ | 86,784 | $ | — | $ | — | $ | 86,784 | $ | (26,439 | ) | |||||||||
(1) In 2014, the Company terminated and settled its interest rate derivatives in conjunction with the settlement of its then existing credit agreement. | ||||||||||||||||||||
(2) The fair values of intangibles relating to the 2012 acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. | ||||||||||||||||||||
(3) During the fourth quarter of 2014, the Company performed its annual impairment analysis of goodwill. As a result of the analysis, the goodwill related to the Engineering Services reporting unit was deemed impaired, and a $26,439 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2014. | ||||||||||||||||||||
2013 | ||||||||||||||||||||
Assets and Liabilities at Fair Value | Total | |||||||||||||||||||
as of December 31, 2013 | Gains | |||||||||||||||||||
Total | (Level 1) | (Level 2) | (Level 3) | (Losses) | ||||||||||||||||
Recurring Fair Value Measurement: | ||||||||||||||||||||
Asset: | ||||||||||||||||||||
Interest rate derivatives (1) | $ | 18 | $ | — | $ | 18 | $ | — | $ | — | ||||||||||
Liabilities: | ||||||||||||||||||||
Interest rate derivatives (1) | $ | 392 | $ | — | $ | 392 | $ | — | $ | — | ||||||||||
Non-recurring Fair Value Measurements: | ||||||||||||||||||||
Asset: | ||||||||||||||||||||
Intangible assets, net (3,4) | $ | 55,465 | $ | — | $ | — | $ | 55,465 | $ | (4,222 | ) | |||||||||
Goodwill (5) | $ | 113,223 | $ | — | $ | — | $ | 113,223 | $ | (73,528 | ) | |||||||||
Liabilities | ||||||||||||||||||||
Contingent Consideration (2) | — | $ | — | — | $ | — | $ | 7,950 | ||||||||||||
(1) The fair values of interest rate derivatives are the amount the Company would receive or pay to terminate the contracts, considering quoted market prices of comparable agreements. (Also see Note 10 to the Consolidated Financial Statements) | ||||||||||||||||||||
(2) The Monte Carlo simulation was used with a normal probability distribution of the best estimate of EBITDA for 2013 to approximate fair value. At June 30, 2013, the EBITDA target was not expected to occur and, as such, the $7,950 of contingent consideration was deemed unlikely to be paid, and a benefit was recorded on a separate line in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | ||||||||||||||||||||
(3) During the second quarter of 2013, a triggering event occurred when the Company commenced an initiative to rebrand its core engineering business. Under this initiative, the D3 Technologies name became obsolete and the $4,222 indefinite lived intangible asset related to that trade name was deemed to be fully impaired and a loss was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | ||||||||||||||||||||
(4) The fair values of intangibles relating to the 2012 acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. | ||||||||||||||||||||
(5) In 2013, the goodwill related to the Valent acquisition was deemed impaired, and a $73,528 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. |
ACCOUNTS_RECEIVABLE_NET
ACCOUNTS RECEIVABLE NET | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Receivables [Abstract] | ||||||||
ACCOUNTS RECEIVABLE NET | ACCOUNTS RECEIVABLE NET | |||||||
Accounts receivable, net consists of the following: | ||||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Trade receivables | $ | 53,081 | $ | 66,292 | ||||
Unbilled revenue | 4,036 | 4,671 | ||||||
Other receivables | 1,581 | 2,070 | ||||||
58,698 | 73,033 | |||||||
Less: Allowance for doubtful accounts | (464 | ) | (180 | ) | ||||
Accounts receivable, net | $ | 58,234 | $ | 72,853 | ||||
Under long-term contract accounting unbilled revenue on long-term contracts arise when the sales or revenues based on performance attainment, though appropriately recognized, cannot be billed yet under terms of the contract as of the balance sheet date. Accounts receivable expected to be collected after one year are not material. |
INVENTORIES
INVENTORIES | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
INVENTORIES | INVENTORIES | |||||||
Inventories consist of the following: | ||||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Raw materials | $ | 16,712 | $ | 17,099 | ||||
Work in progress | 22,960 | 21,605 | ||||||
Manufactured and purchased components | 21,296 | 21,675 | ||||||
Finished goods | 32,403 | 40,572 | ||||||
Product inventory | 93,371 | 100,951 | ||||||
Capitalized contract costs (1) | 20,908 | 12,227 | ||||||
Total inventories | $ | 114,279 | $ | 113,178 | ||||
(1) 2013 includes a reduction to inventory of $2,057 related to a loss reserve on a long-term production contract. | ||||||||
In accordance with ASC 605-35-45-1&2, the provisions for anticipated losses on contracts are accounted for as additional contract cost and recognized as part of cost of sales. Provisions for losses are recorded as a reduction of related contract costs recorded in inventory. | ||||||||
Inventoried costs include capitalized contract costs relating to programs and contracts with long-term production cycles, substantially all of which is not expected to be realized within one year. The increase in capitalized contract costs in 2014 relates primarily to four contracts that are in the early stages of production. The Company believes these amounts will be fully recovered over the life of the contracts. |
PROPERTY_PLANT_AND_EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
PROPERTY PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT | |||||||
Depreciation expense (including amortization expense on software) recorded by the Company totaled $17,934, $15,913 and $5,894 for 2014, 2013 and 2012, respectively. | ||||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Land | $ | 1,108 | $ | 1,455 | ||||
Buildings and improvements | 25,415 | 23,692 | ||||||
Machinery and equipment | 122,509 | 122,132 | ||||||
Leasehold improvements | 13,034 | 14,421 | ||||||
Software and other | 12,059 | 11,403 | ||||||
Construction in progress | 10,696 | 5,031 | ||||||
Total gross property, plant and equipment | 184,821 | 178,134 | ||||||
Less accumulated depreciation | (85,339 | ) | (74,759 | ) | ||||
Total net property, plant and equipment | $ | 99,482 | $ | 103,375 | ||||
See discussion in Note 9 to the Consolidated Financial Statements regarding property, plant and equipment recorded associated with capital leases. |
GOODWILL_AND_INTANGIBLE_ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS | |||||||||||||||||||||||
Goodwill | ||||||||||||||||||||||||
The following table summarizes the net carrying amount of goodwill by segment at December 31, 2014 and 2013, respectively: | ||||||||||||||||||||||||
Engineering | ||||||||||||||||||||||||
Aerostructures | Services | Total | ||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||
Balance at December 31, | ||||||||||||||||||||||||
Gross Goodwill | $ | 141,953 | $ | 141,953 | $ | 50,741 | $ | 50,741 | $ | 192,694 | $ | 192,694 | ||||||||||||
Accumulated impairment loss | (79,471 | ) | (79,471 | ) | (26,439 | ) | — | (105,910 | ) | (79,471 | ) | |||||||||||||
Net Goodwill | $ | 62,482 | $ | 62,482 | $ | 24,302 | $ | 50,741 | $ | 86,784 | $ | 113,223 | ||||||||||||
The net goodwill balance for the Aerostructures segment is primarily related to the acquisition of Valent in December 2012, which accounts for $56,288 of the balance at both December 31, 2014 and 2013. Under ASC 805, the acquiring entity has a period of time, referred to as the measurement period, to finalize the accounting for a business combination. During 2013, the gross goodwill balance in Aerostructures was impacted by measurement period changes related to the acquisition of Valent. The largest material adjustment recorded in 2013 was related to a loss reserve on a long-term contract of $5,267. The associated loss reserve was recognized when the Company determined that an acquired contract on the Boeing 787 program was under-priced related to the level of effort required. Other adjustments recorded during the measurement period were related to a reduction in the value of fixed assets of $482 which was offset by a working capital settlement adjustment of $1,219. In addition, during the fourth quarter of fiscal 2013, in accordance with the Company’s accounting policy as described in Note 1 to the Consolidated Financial Statements, the Company performed the annual impairment analysis and determined that carrying value of goodwill for Valent was above its fair value. As a result, a goodwill impairment charge of $73,528 was recorded in the fourth quarter of 2013. The annual impairment analysis performed in the fourth quarter of 2014 determined that the fair value for Valent and the remaining goodwill in Aerostructures exceeded its carrying value. | ||||||||||||||||||||||||
During the fourth quarter of fiscal 2014, in accordance with the Company's accounting policy as described in Note 1 to the Consolidated Financial Statements, the Company also performed its annual impairment analysis on the Engineering Services reporting unit and determined that the carrying value of goodwill was above its fair value. As a result, a goodwill impairment charge of $26,439 was recorded in the fourth quarter of 2014, which brought the remaining goodwill associated with the reporting unit to $24,302. | ||||||||||||||||||||||||
The net goodwill balances at December 31, 2014 and December 31, 2013 also included $6,194 from the acquisition of Intec in January 2009. The net goodwill balance at December 31, 2013 included $50,741 related to the Engineering Services reporting unit. | ||||||||||||||||||||||||
Goodwill recorded as a result of the D3 and Intec acquisitions is not deductible for tax purposes, while goodwill recorded as a result of the Valent and TASS acquisitions is deductible for tax purposes. | ||||||||||||||||||||||||
Intangible Assets | ||||||||||||||||||||||||
Intangible assets primarily consist of trademarks and customer intangibles resulting from the acquisitions of Versaform Corporation, D3, Intec, TASS, and Valent. The trademark of $4,222 that resulted from acquisition of D3 was determined to have an indefinite life. During the second quarter of 2013, a triggering event occurred when the Company commenced an initiative to rebrand its core engineering business. Under this initiative, the D3 Technologies name will no longer be used and the $4,222 indefinite lived intangible asset related to that trade name was deemed to be fully impaired. The amount was calculated using the income approach with a level 3 valuation. The impairment loss was recognized in the Engineering Services segment in a separate line in the selling, general and administrative expenses of the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | ||||||||||||||||||||||||
The remaining trademarks resulted from the acquisitions of Intec, TASS, and Valent and have a weighted average useful life of 4.5 years. Customer intangibles have a weighted average useful life of 18.5 years. Other intangible assets have a weighted average useful life of 5.3 years. The carrying values were as follows: | ||||||||||||||||||||||||
December 31, | ||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||
Trademarks | $ | 778 | $ | 778 | ||||||||||||||||||||
Customer intangible assets | 68,991 | 68,991 | ||||||||||||||||||||||
Other | 1,274 | 1,274 | ||||||||||||||||||||||
Accumulated amortization | (20,103 | ) | (15,578 | ) | ||||||||||||||||||||
Intangible assets, net | $ | 50,940 | $ | 55,465 | ||||||||||||||||||||
Intangibles amortization expense for 2014, 2013 and 2012 was $4,524, $4,647 and $3,185, respectively. | ||||||||||||||||||||||||
The estimated annual amortization expense for intangibles assets is as follows: | ||||||||||||||||||||||||
Year ending December 31, | ||||||||||||||||||||||||
2015 | $ | 4,359 | ||||||||||||||||||||||
2016 | 4,134 | |||||||||||||||||||||||
2017 | 3,915 | |||||||||||||||||||||||
2018 | 3,563 | |||||||||||||||||||||||
2019 | 3,263 | |||||||||||||||||||||||
Thereafter | 31,706 | |||||||||||||||||||||||
$ | 50,940 | |||||||||||||||||||||||
ACCRUED_EXPENSES
ACCRUED EXPENSES | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Payables and Accruals [Abstract] | ||||||||
ACCRUED EXPENSES | ACCRUED EXPENSES | |||||||
Accrued expenses consist of the following: | ||||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Accrued interest | $ | 9,814 | $ | 125 | ||||
Accrued payroll | 1,647 | 3,286 | ||||||
Accrued bonus | 3,014 | 958 | ||||||
Accrued vacation & holiday | 2,933 | 3,516 | ||||||
Accrued employee benefits | 1,800 | 1,847 | ||||||
Accrued operating lease obligations | 2,186 | 2,002 | ||||||
Accrued professional fees | 980 | 1,253 | ||||||
Accrued restructuring | 739 | 422 | ||||||
Loss reserve on long-term production contracts | — | 3,165 | ||||||
Other | 2,959 | 1,992 | ||||||
Total accrued expenses | $ | 26,072 | $ | 18,566 | ||||
During the second quarter of 2014, the Company replaced its primary debt obligation, which required quarterly interest payments, with debt that requires semi-annual interest payments. The first payment on the Company's primary debt obligation is due in January 2015, resulting in an increase in accrued interest of $9,689 in 2014. | ||||||||
In 2013, as previously discussed, the Company recorded a loss reserve of $5,267 related to a long-term production contract at Valent. (See Note 1, Accounting Policies and Note 7, Goodwill and Intangible Assets). At December 31, 2013, the loss reserve balance was $5,222 of which $3,165 was included in accrued expenses with the remainder recorded as a reduction of related contract inventory. As discussed in Note 5, during the third quarter of 2014 events occurred that changed the Company's expectations with regard to future costs on this contract and the related loss reserve was reversed, resulting in a favorable cumulative catch up adjustment. |
LONGTERM_DEBT_AND_CAPITAL_LEAS
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS Long Term Debt and Capital Lease Obligations (Notes) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Long-term Debt and Capital Lease Obligations | LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS | |||||||
Long-term debt and capital lease obligations consist of the following: | ||||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Second priority senior secured notes at a fixed rate of 7.375% at December 31, 2014 | $ | 245,000 | $ | — | ||||
Term loan under credit agreement, variable | — | 222,750 | ||||||
Revolver under credit agreement, variable | — | 36,000 | ||||||
Missouri IRBs at fixed rate of 2.80% at December 31, 2014 and December 31, 2013 | 7,334 | 7,756 | ||||||
Capital Leases, at fixed rates ranging from 2.04% to 7.73% at December 31, 2014 and 2.04% to 7.73% at December 31, 2013 | 13,288 | 14,572 | ||||||
Notes payable, principal and interest payable monthly, at fixed rates, up to 2.56% and 3.60% at December 31, 2014 and 2013, respectively (1) | 3,356 | 9,533 | ||||||
Total debt | 268,978 | 290,611 | ||||||
Less current installments | 3,424 | 5,242 | ||||||
Total long-term debt and capital lease obligations | $ | 265,554 | $ | 285,369 | ||||
(1) During the year ended December 31, 2014, the Company settled a mortgage and an equipment loan in cash in the amount of $2,109 and $3,140, respectively. | ||||||||
On June 19, 2014, the Company issued $250,000 in second-priority senior secured notes maturing on June 19, 2019. During the quarter ended September 30, 2014, the Company repurchased and retired $5,000 of the outstanding notes at a premium of 1.125%, plus accrued interest. Obligations under these notes are secured by substantially all of the Company’s assets and bear interest at 7.375%, paid semi-annually in January and July, with interest payments commencing in January of 2015. In addition, on June 19, 2014, the Company used the proceeds from the issuance of these notes to settle and terminate its existing term loan and also modified its revolving credit agreement. | ||||||||
The modified revolving credit agreement, entered into on June 19, 2014, provides for a revolving credit facility of up to $90,000. Under the agreement, the co-collateral agents may establish a reserve against the facility. At December 31, 2014, the reserve established was $15,000, which reduced the maximum availability to $75,000. Based on the amount of eligible assets at December 31, 2014 and considering outstanding letters of credit of $1,210, available borrowings were further reduced to $56,545. The maximum amount, less reserves, available for borrowing at levels below $30,000 are based on a sum of 45% of eligible receivables, 30% of eligible inventories and an additional amount of eligible equipment up to 20% of total borrowings under the facility. The maximum amount, less reserves, available for borrowing at levels above $30,000 are based on a sum of 75% of eligible receivables, 45% of eligible inventories and an additional amount of eligible equipment up to 20% of total borrowings under the facility. Borrowings under the facility are secured by a first lien on substantially all of the Company’s assets and bear interest at either the LIBOR rate plus a margin of 3.00% to 3.50% or the alternate base rate (“ABR”) which is the highest of the following plus a margin of 2.00% to 2.50%, respectively, with the applicable margins for the revolving credit facility subject to a grid based on the average availability ratio of the Company for the most recently completed quarter: | ||||||||
•Prime rate, | ||||||||
•Federal funds rate plus 0.5%, or, | ||||||||
•The adjusted Eurodollar rate for an interest period of one month plus 1%. | ||||||||
For the year ended December 31, 2014, the actual average interest rate incurred for the revolving credit facility was 4.5%. | ||||||||
The Company is required to pay a commitment fee of between 0.375% and 0.5% per annum on the unused portion of the revolving credit facility, depending on the average revolver usage during the period as compared to the total available borrowings under the facility. At December 31, 2014, the commitment fee required was 0.5%. | ||||||||
The revolving credit loan facility matures on the earlier of the fifth year anniversary date of June 19, 2019 or the date that is 91 days prior to the maturity date of the senior secured notes unless the notes are repaid, refinanced or otherwise satisfied in full. The maturity dates are subject to acceleration upon occurrence of an event of default. An event of default under the revolving credit agreement includes, among other things, failure to pay any material indebtedness, acceleration of payments by any lender prior to scheduled maturity, or judgments rendered against the Company requiring payments at or above certain levels. | ||||||||
The credit agreement contains a covenant that requires us to comply with a maximum first priority debt to EBITDA ratio on a quarterly basis. In addition, the agreement also contains certain restrictive covenants that limit and in some circumstances prohibit, our ability to, among other things, incur additional debt, sell, lease or transfer our assets, make investments, guarantee debt or obligations, create liens, and enter into certain merger, consolidation or other reorganization transactions. These restrictive covenants prohibit the Company from paying dividends. These restrictions could limit our ability to obtain future financing, make acquisitions or needed capital expenditures, withstand the current or future downturns in our business or the economy in general, conduct operations or otherwise take advantage of business opportunities that may arise, any of which could place us at a competitive disadvantage relative to our competitors that have less debt and are not subject to such restrictions. | ||||||||
At December 31, 2014, the Company was in compliance with all of its covenants and expected to be in compliance with its covenants in future periods. If the Company fails to meet any covenants in the credit facility, the Company would not be in compliance with its credit agreement and the lenders would be entitled to exercise various rights, including causing the amounts outstanding under the revolving credit facility to become immediately due and payable. | ||||||||
A portion of the Company's debt and capital leases related to buildings and equipment that were underwritten to service underlying Industrial Revenue Bonds (“IRBs”) with the City of Washington, Missouri and Fredonia, Kansas. Monthly payments are scheduled in an amount sufficient to service the total principal and interest of the underlying bonds. Interest ranges from 2.80% to 4.57% and mature between September 2020 and June 2032. In addition, the Company's debt includes a note payable to a prior minority shareholder for $2,000 payable in monthly installments over 36 months and a capital lease of $312 related to the building in Coweta, Oklahoma that carries an interest rate of 7.73% and requires monthly payments through March 2022. | ||||||||
The Company has also entered into various notes payable and capital lease agreements for the purchase of certain equipment. The notes are secured by certain equipment and payable in monthly installments including interest ranging from 2.45% to 2.56% through November 2019. In connection with its acquisition of TASS on August 7, 2012, as discussed in Note 2 above, the Company entered into a $1,000 note payable which was paid in full in August 2013 plus interest at 3.25%. In December 2012, the Company entered into a commitment to finance a warehouse in Tulsa, Oklahoma through a $2,200 promissory note which was paid in full in June of 2014 plus interest at 2.95%. On March 28, 2013, the Company entered into a $3,550 promissory note at a 3.60% fixed interest rate to finance the purchase of a corporate aircraft. The aircraft was sold and the associated note was paid in full in December of 2014. | ||||||||
The gross amount of assets recorded under capital leases totaled $15,567 as of December 31, 2014 and is included in the related property, plant and equipment categories. The long-term debt and capital lease payment obligations including the current portion thereof required in each of the next five years and thereafter are as follows: | ||||||||
Year ending December 31, | Long-Term | Capital Leases | ||||||
Debt (1) | ||||||||
2015 | $ | 1,983 | $ | 1,946 | ||||
2016 | 951 | 1,916 | ||||||
2017 | 919 | 1,962 | ||||||
2018 | 944 | 2,223 | ||||||
2019 | 245,849 | 2,500 | ||||||
Thereafter | 4,919 | 5,175 | ||||||
Total | 255,565 | 15,722 | ||||||
Less: imputed interest | — | (2,309 | ) | |||||
Total | $ | 255,565 | $ | 13,413 | ||||
(1) Includes principal only | ||||||||
The Company has appropriately split the deferred financing fees incurred in connection with its debt and will amortize the fees over their respective terms. In 2014, as a result of the refinancing of its existing long term indebtedness, which resulted in the settlement and termination of its credit agreement, unamortized debt issuance costs associated with the agreement of $8,466 were written off and recognized as interest expense. Debt issuance costs of $8,122 were incurred as a result of the 2014 refinancing transactions and are being amortized over the term of the notes and revolving credit agreement, which is five years. |
DERIVATIVE_FINANCIAL_INSTRUMEN
DERIVATIVE FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | DERIVATIVE FINANCIAL INSTRUMENTS | ||||||||||
On June 19, 2014, the Company terminated and settled its interest rate derivatives in conjunction with the settlement of its then existing credit agreement, which had a variable interest rate. This settlement resulted in a charge of $793 to interest expense in the Condensed Consolidated Statements of Comprehensive Income (Loss) in the year ended December 31, 2014. Prior to this termination and in compliance with the credit agreement, the Company purchased option and swap derivative contracts to hedge against the potential impact on earnings from an increase in market interest rates associated with the interest payments on its variable rate term credit facility. The objective of the hedge transactions was to reduce the variability of cash flows due to changes in the designated benchmark interest rate on the term debt. The Company had no derivative financial instruments recorded in the Condensed Consolidated Balance Sheet at December 31, 2014. At December 31, 2013, the derivatives were recognized in the Condensed Consolidated Balance sheet as current assets and liabilities at fair value as follows: | |||||||||||
Derivative Assets and Liabilities | Location in Condensed | 31-Dec-13 | |||||||||
Consolidated Balance Sheet | |||||||||||
Derivative designated as hedging instrument: | |||||||||||
Interest rate purchased options at fair value | Other current assets | $ | 18 | ||||||||
Derivative designated as hedging instrument: | |||||||||||
Interest rate swaps at fair value | Other long term liabilities | $ | 392 | ||||||||
The Company designated and accounted for these swaps and purchased options as cash flow hedges of interest rate risk. The Company reported the gain or loss, net of taxes, from the effective portion of the hedge as a component of Accumulated Other Comprehensive Income (“AOCI”) deferring it and reclassifying it into earnings in the same period or periods in which the hedged transaction affects earnings and in the same line item on the Condensed Consolidated Statements of Comprehensive Income (Loss) as the impact of the hedged transaction. The cumulative amounts reported in AOCI related to these derivatives were reclassified from AOCI to interest expense on the Condensed Consolidated Statements of Comprehensive Income (Loss) in the quarter ended June 30, 2014. The Company did not use these derivative instruments for trading or speculative purposes. | |||||||||||
The following amounts are included in AOCI and earnings for the year ended December 31, 2014: | |||||||||||
Net of Tax | |||||||||||
Derivatives in Cash Flow Hedging Relationship | Effective portion | Effective | |||||||||
of (Gain) Loss Recognized in AOCI on | Portion of | ||||||||||
Derivative | (Gain) Loss Reclassified | ||||||||||
from AOCI | |||||||||||
into | |||||||||||
Earnings | |||||||||||
Year ended December 31, 2014 | |||||||||||
Interest rate derivatives | $ | — | $ | 278 | |||||||
TREASURY_STOCK_TRANSACTIONS
TREASURY STOCK TRANSACTIONS | 12 Months Ended |
Dec. 31, 2014 | |
Equity [Abstract] | |
TREASURY STOCK TRANSACTIONS | TREASURY STOCK TRANSACTIONS |
Treasury stock increased in 2014 by 6,075 shares. This increase resulted from forfeitures of 32,890 shares related to the Company's long-term incentive plan and 2,651 shares surrendered to the Company in settlement of tax obligations on vested restricted shares, offset by issuances of 17,291 shares related to grants of restricted stock and 12,175 shares to settle obligations under a consulting agreement. The Company issued from treasury stock 38,397 shares, net of forfeitures, in 2013 and 102,986 shares in 2012, in conjunction with grants of restrictive stock, but did not purchase any shares during those years. The Company also utilized approximately 40,904 and 44,474 shares from treasury stock to match employee contributions in the Company’s 401(k) Plan in 2013 and 2012, respectively. In 2014, the Company utilized common stock to match employee contributions to the 401(k) Plan. |
LOSS_EARNINGS_PER_COMMON_SHARE
(LOSS) EARNINGS PER COMMON SHARE | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Earnings Per Share [Abstract] | ||||||||||||
EARNINGS PER COMMON SHARE | EARNINGS PER COMMON SHARE | |||||||||||
Basic net income per common share is based upon the weighted average number of common shares outstanding. Diluted net income per common share is based upon the weighted average number of common shares outstanding, including the dilutive effect of restricted stock, using the if-converted methods. | ||||||||||||
The following table shows a reconciliation of the numerators and denominators used in calculating basic and diluted earnings per share. | ||||||||||||
Year ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Numerators | ||||||||||||
Net (loss) income | $ | (28,962 | ) | $ | (58,485 | ) | $ | 16,487 | ||||
Denominators | ||||||||||||
Weighted average common shares - basic | 12,716,976 | 12,607,833 | 11,701,607 | |||||||||
Dilutive effect of restricted stock | — | — | 137,575 | |||||||||
Weighted average common shares - diluted | 12,716,976 | 12,607,833 | 11,839,182 | |||||||||
Basic earnings per share | $ | (2.28 | ) | $ | (4.64 | ) | $ | 1.41 | ||||
Diluted earnings per share | $ | (2.28 | ) | $ | (4.64 | ) | $ | 1.39 | ||||
For the twelve months ended December 31, 2014 and December 31, 2013, 153,249 and 111,976 shares are not included in the calculation of diluted earnings per share, as their inclusion would have been anti-dilutive. These securities could be dilutive in future periods. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Commitments and Contingencies Disclosure [Abstract] | ||||
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES | |||
The Company leases certain facilities and equipment under various non-cancelable operating lease agreements that expire at various dates through 2025. At December 31, 2014, the future minimum lease payments under operating leases with initial non-cancelable terms in excess of one year are as follows: | ||||
2015 | $ | 8,023 | ||
2016 | 7,197 | |||
2017 | 6,234 | |||
2018 | 5,664 | |||
2019 | 4,552 | |||
Thereafter | 18,066 | |||
$ | 49,736 | |||
Rent expense totaled $8,396, $8,501 and $6,789 in 2014, 2013 and 2012, respectively. | ||||
The Company has entered into employment agreements with certain members of senior management, the terms of which expire on January 1, 2016 through December 31, 2016. The terms of these agreements are up to 3 years, include non-compete and non-disclosure provisions, and provide for defined severance payments in the event of termination. | ||||
Legal Contingencies | ||||
The Company has been named as a defendant in certain pending lawsuits in the normal course of business (the “Pending Lawsuits”). The Company is also the subject of the various proceedings described below. It is the policy of management to disclose the amount or range of reasonably possible losses from any legal proceedings. | ||||
In the opinion of management, after consulting with legal counsel, the losses, if any, resulting from the Pending Lawsuits should not have a material effect on the Company’s financial position or results of operations. | ||||
In November, 2013, the Attorney General of the State of Missouri (the “Missouri AG”) contacted LMI regarding allegations of violations of certain state environmental regulations involving the discharge of pollutants and water contaminants claimed to have occurred in 2011 by Ozark Mountain Technologies ("OMT"), a subsidiary of LMI, (the “Missouri AG Matter”). On February 25, 2015, the Missouri AG filed a Petition against OMT alleging pollution of state waters, violation of pretreatment regulations and violation of water quality standards. The Company believes it is probable that the Missouri AG’s office will assess a penalty on OMT. In the opinion of management, after consulting with legal counsel and based on the discussions the Company has had with the Missouri AG, the Company has established a loss contingency of $175, which represents management’s current estimate of the minimum penalty the Missouri AG is contemplating assessing on OMT. | ||||
In August 2013, the Environmental Protection Agency ("EPA") and the U.S. Dept. of Justice (“DoJ”) commenced an investigation into allegations of low pH wastewater releases claimed to have occurred between 2009 and 2013 at OMT’s facility (the “Waste Water Allegations”). Based on discussions with the DoJ, the Company believes that charges and fines are likely, In the opinion of management, after consulting with legal counsel, the Company has established a loss contingency of $694, which represents management’s current estimate of the minimum penalty the DoJ is contemplating assessing on OMT. | ||||
Until we have a final agreement with the respective agency, we cannot provide any assurance that the loss contingencies will not increase or that such agency will not take other action. | ||||
OMT became a subsidiary of LMI as a result of LMI’s acquisition of Valent in December 2012. The Company believes certain environmental representations set forth in the purchase agreement pursuant to which Valent acquired OMT; and the purchase agreement pursuant to which LMI acquired Valent, provide the Company with certain rights of indemnification with respect to the matters disclosed herein. The Company also has insurance policies that it believes covers various environmental issues at Valent and its subsidiaries, including OMT, and breaches by Valent and OMT of their respective environmental representations and warranties in each of the purchase agreements. As a result, the Company believes its rights of indemnification and insurance coverage may provide for a recovery of some or all of the costs associated with the matters disclosed herein. We cannot provide any assurance, however, that we will ultimately prevail in any claim for indemnification or secure insurance proceeds from our insurance policies. | ||||
In December 2014, two of the former members of Valent, Tech Investments, LLC and Tech Investments II, LLC that collectively own approximately 5.5% of the Company’s common stock, filed suit in the Circuit Court of St. Louis County against the Company seeking declaratory judgment (a) declaring that the Company is not entitled to indemnification on certain claims asserted against the former members of Valent, (b) ordering the release of the remaining escrow funds associated with the Company’s purchase of Valent, and (c) ordering that the Company’s is not entitled to exercise a right of redemption on 360,301 shares of the Company’s stock, currently held under a Lock Up Agreement pending resolution of the indemnification claims (the “Tech Lawsuit”). In February 2015, the Company filed its response moving to dismiss the Tech Lawsuit on the grounds that the declaratory judgment is not proper in this matter. In the opinion of management, the losses, if any, resulting from the Tech Lawsuit should not have a material effect on the Company’s financial position, cash flows or results of operations. |
DEFINED_CONTRIBUTIONS_PLANS
DEFINED CONTRIBUTIONS PLANS | 12 Months Ended |
Dec. 31, 2014 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
DEFINED CONTRIBUTIONS PLANS | DEFINED CONTRIBUTION PLANS |
The Company sponsored three defined contribution plans in 2014: the LMI Profit Sharing and Savings Plan (the “LMI Plan”), the Valent 401(k) plan the (“Valent Plan”) and the TASS Inc. 401(k) Plan, the (“TASS Plan”). The TASS plan was merged into the LMI plan effective July 1, 2014 and was subsequently terminated. | |
At December 31, 2014, the LMI Plan covers virtually all of the employees of the Company, except the employees of Valent, and is a profit sharing plan that allows discretionary profit sharing contributions by the Company. The LMI Plan also includes a 401(k) component that allows employee deferrals and a discretionary matching contribution component, under which the Company may make contributions based upon a percentage of employee contributions up to a maximum of $1 annually per employee. Employee deferrals and matching contributions to the LMI Plan are fully vested to the employee immediately upon contribution. Profit sharing contributions by the Company to the LMI Plan become vested over time and are fully vested after 6 years. No profit sharing contributions have been made to the LMI Plan for 2014, 2013, or 2012. The Company recognized costs for matching contributions to the LMI Plan totaling $729, $830, and $882 in 2014, 2013, and 2012, respectively. The Company’s matching contributions to the LMI Plan are determined and approved by the Board of Directors, which can be settled in cash or shares of LMI common stock. For the years ended December 31, 2014, 2013, and 2012, the Company made matching contributions of 50% for each one dollar contributed by each participant up to a maximum employer matching contribution of $1 per employee. In 2014, 2013, and 2012 the contribution was made in shares of the Company’s common stock. The amount of the expense is calculated based on the formula described above and is not impacted by the value of the common stock, as the shares given are based on the dollar amount of the matching contribution. | |
The Valent Plan covers essentially all full-time employees of Valent. Under this plan, participants may elect to have a portion of their salary contributed to the respective plans within certain limits. Under the plan, the Company may contribute a discretionary matching contribution. The exact percentage, if any, will be determined each year and shall not exceed 3% of a participant’s compensation for the year. During 2014 and 2013, the Company recognized expense of $848 and $745, respectively, equaling 100% of the first 3% of participant compensation in both years. | |
The TASS Plan covered all of the employees of TASS effective on the first day of full-time employment until the plan was terminated on July 1, 2014. Under this plan, participants may have elected to have a portion of their salary contributed to the plan within certain limits. Under the plan, the Company may have contributed a discretionary profit sharing and/or matching contribution to the plan. The exact percentage, if any, was determined each year and was not limited by the plan. Contributions by the Company to the plan became vested over time and were fully vested after 5 years. The Company did not make any profit sharing contribution or matching contribution to the plan subsequent to the acquisition of TASS on August 7, 2012. |
STOCK_BASED_COMPENSATION
STOCK BASED COMPENSATION | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||
STOCK BASED COMPENSATION | STOCK-BASED COMPENSATION | ||||||
On July 7, 2005, the Company’s shareholders approved the LMI Aerospace, Inc. 2005 Long-term Incentive Plan (the “Plan”). The Plan provides for the grant of non-qualified stock options, incentive stock options, shares of restricted stock, restricted stock units, stock appreciation rights, performance awards and other share-based grants and cash bonus awards to employees and directors. All share-based grants or awards are subject to a time-based vesting schedule. The company has issued shares of restricted stock and restricted stock units in the periods presented. | |||||||
A summary of the activity for non-vested restricted stock awards under the Company’s share-based compensation plans is presented below: | |||||||
2014 | |||||||
Restricted Stock Awards | Shares | Weighted Average | |||||
Grant Date Fair | |||||||
Value | |||||||
Outstanding at January 1 | 219,751 | $ | 19.74 | ||||
Granted | 189,902 | 13.97 | |||||
Vested | (78,779 | ) | 18.5 | ||||
Forfeited | (34,092 | ) | 17.95 | ||||
Outstanding at December 31 | 296,782 | $ | 16.58 | ||||
Common stock compensation expense related to restricted stock awards granted under the Plan was $1,850, $1,615 and $1,494 for the years ended December 31, 2014, 2013 and 2012, respectively. Total unrecognized compensation costs related to non-vested share-based awards granted or awarded under the Plan were $2,036 and $1,857 as of December 31, 2014 and December 31, 2013, respectively. These costs are expected to be recognized over a weighted average period of 1.2 and 1.2 years as of December 31, 2014 and 2013, respectively. The fair value of restricted stock awards that vested during the years ended December 31, 2014, 2013 and 2012, based on the market price on the vesting date, was $1,083, $602 and $3,199, respectively. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||
INCOME TAXES | INCOME TAXES | |||||||||||
Net deferred tax (liabilities)/assets at December 31, were as follows: | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | |||||||||||
Deferred tax assets | $ | 31,580 | $ | 32,282 | ||||||||
Deferred tax liabilities | (19,198 | ) | (14,363 | ) | ||||||||
Valuation allowance | (12,676 | ) | (18,137 | ) | ||||||||
Net deferred tax liabilities | $ | (294 | ) | $ | (218 | ) | ||||||
Based on our current and anticipated future pre-tax earnings, we believe it is more likely than not that our federal and state deferred tax assets, including benefits related to net operating loss carry forwards, will not be realized based on the measurement standards required under ASC 740, Accounting for Income Taxes. We established a valuation allowance at December 31, 2013. At December 31, 2014, the valuation allowance was decreased by $5,461 primarily due to the decision to carry back the net operating losses for 2014. We evaluated all significant available positive and negative evidence, including the existence of losses in the current and prior year in assessing the continuing need for a valuation allowance. | ||||||||||||
The temporary differences between the tax basis of assets and liabilities and their financial reporting amounts that give rise to the deferred income tax assets and liabilities are as follows: | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | |||||||||||
Goodwill and intangible assets | $ | 16,375 | $ | 19,491 | ||||||||
Inventories | 3,483 | 3,871 | ||||||||||
NOL carry forwards | 2,345 | 651 | ||||||||||
Tax credit carry forwards | 1,180 | 367 | ||||||||||
Stock award | 1,049 | 891 | ||||||||||
Gain on sale of real estate | 868 | 954 | ||||||||||
Obligation under operating leases | 800 | 733 | ||||||||||
Accrued vacation | 773 | 912 | ||||||||||
Accrued bonus | 722 | 351 | ||||||||||
Other | 547 | 351 | ||||||||||
Long-term contract costs | (7,652 | ) | (4,475 | ) | ||||||||
Depreciation | (8,108 | ) | (6,178 | ) | ||||||||
Valuation allowance | (12,676 | ) | (18,137 | ) | ||||||||
Net deferred tax liabilities | $ | (294 | ) | $ | (218 | ) | ||||||
The Company’s income tax (benefit) provision attributable to income before taxes consisted of the following for the years ended December 31, 2014, 2013 and 2012 | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Federal: | ||||||||||||
Current | $ | (9,173 | ) | $ | (676 | ) | $ | 7,926 | ||||
Deferred | 155 | (6,066 | ) | (109 | ) | |||||||
(9,018 | ) | (6,742 | ) | 7,817 | ||||||||
State: | ||||||||||||
Current | 21 | 120 | 346 | |||||||||
Deferred | 44 | (357 | ) | (10 | ) | |||||||
65 | (237 | ) | 336 | |||||||||
(Benefit) provision for income taxes | $ | (8,953 | ) | $ | (6,979 | ) | $ | 8,153 | ||||
The current federal benefit in 2014 reflects the Company's decision to carry back its 2013 and 2014 tax losses to prior years in order to obtain tax refunds. The Company recorded $6,349 of income tax receivable as of December 31, 2014 to reflect the tax benefit from the current period loss that will be carried back to prior years to offset taxable income in the available carry back period. This income tax receivable is reflected within prepaid expenses and other current assets on the Consolidated Balance Sheets. | ||||||||||||
The reconciliation of income tax computed at the U.S. federal statutory tax rates to income tax (benefit) provision is as follows: | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Federal taxes | $ | (13,270 | ) | $ | (22,912 | ) | $ | 8,627 | ||||
State and local taxes, net of federal benefit | 358 | (1,119 | ) | 336 | ||||||||
Production deduction | — | — | (530 | ) | ||||||||
Non-deductible goodwill impairment | 9,254 | — | — | |||||||||
Valuation allowance | (5,294 | ) | 17,718 | — | ||||||||
Research and experimental and other tax credits | (503 | ) | (634 | ) | (300 | ) | ||||||
Other | 502 | (32 | ) | 20 | ||||||||
(Benefit) provision for income taxes | $ | (8,953 | ) | $ | (6,979 | ) | $ | 8,153 | ||||
At December 31, 2014, the Company had deferred tax assets of $1,936 in federal net operating loss and tax credit carry forwards which will expire in the year 2034. At December 31, 2014, the Company had deferred tax assets of $1,501 in state net operating loss and state tax credit carry forwards. The state net operating losses begin to expire in the year 2023 through 2034. |
RESTRUCTURING
RESTRUCTURING | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Restructuring and Related Activities [Abstract] | ||||||||||||
RESTRUCTURING | RESTRUCTURING | |||||||||||
During the fourth quarter of 2013, the Company committed to a restructuring plan that resulted in the closure of its Precise Machine facility located in Fort Worth, Texas. As a result, the Company recognized severance expense of $453 in the year ended December 31, 2013. Additional restructuring expenses related to the closure of $287 were recognized by the Company in the year ended December 31, 2014. The Company completed this restructuring plan in the second quarter of 2014. | ||||||||||||
On January 23, 2014, the Company announced plans to relocate the work performed relative to machining operations at its Savannah, Georgia facility to other locations within the company. As a result, severance expense of $47 was recognized in the year ended December 31, 2014. The Company completed this restructuring plan in the second quarter of 2014. | ||||||||||||
In addition, on November 5, 2014, the Company committed to a restructuring plan that will result in relocation of the St. Charles machine part operations to other facilities within the Company. As a result, severance expense of $228 was recognized in the year ended December 31, 2014. The Company expects this restructuring plan to be completed in the second quarter of 2015. | ||||||||||||
In the year ended December 31, 2014, the Company recognized additional severance expense of $2,023 relative to other employment separation activities. These activities are part of the Company's overall reorganization and cost reduction initiatives. In the year ended December 31, 2013, the Company reached a separation agreement with key members of Valent Aerostructures, LLC. that resulted in recognition of $2,620 in restructuring expenses. | ||||||||||||
All restructuring expenses were reflected in the selling, general, and administrative section on a separate line of the Condensed Consolidated Statements of Comprehensive Income (Loss). | ||||||||||||
Cash payments associated with these restructuring plans of $2,268 and $2,620 were made in the years ended December 31, 2014 and December 31, 2013, respectively. | ||||||||||||
The following table summarizes the incurred and expected charges associated with these restructuring activities: | ||||||||||||
Expense | Remaining | Total Expense | ||||||||||
Incurred through | Expense to be | Expected to be | ||||||||||
31-Dec-14 | Incurred | Incurred | ||||||||||
(In Thousands) | ||||||||||||
Employee severance arrangement - Precise closure | $ | 615 | $ | — | $ | 615 | ||||||
Employee severance arrangement - Savannah | 47 | — | 47 | |||||||||
Employee severance arrangement - St. Charles closure | 228 | 76 | 304 | |||||||||
Other employee severance arrangements | 1,908 | — | 1,908 | |||||||||
Lease termination costs - Precise closure | 124 | — | 124 | |||||||||
Other restructuring expenses | 115 | — | 115 | |||||||||
Total | $ | 3,037 | $ | 76 | $ | 3,113 | ||||||
In addition to the restructuring expenses detailed in the table above, the Company incurred and recognized additional project expenses of approximately $364 as of December 31, 2014, associated with the integration of work previously performed at the Precise Machine facility. As of December 31, 2014, the Company also incurred and recognized approximately $500 and $18 in other project costs largely related to accelerated depreciation on property, plant and equipment at its Savannah and St. Charles facilities, respectively. These expenses are recognized in the cost of goods sold and selling, general, and administrative expense in the Consolidated Statements of Comprehensive Income (Loss). | ||||||||||||
The following table summarizes restructuring activity related to the Precise Machine facility closure, Savannah machining relocation, St. Charles facility closure and other employee separation activities: | ||||||||||||
Employee | ||||||||||||
Severance | Other | Total | ||||||||||
(In Thousands) | ||||||||||||
Accrued restructuring balance as of December 31, 2013 | $ | 422 | $ | — | $ | 422 | ||||||
Accrual additions | 2,461 | 124 | 2,585 | |||||||||
Cash payments | (2,144 | ) | (124 | ) | (2,268 | ) | ||||||
Accrued restructuring balance as of December 31, 2014 | $ | 739 | $ | — | $ | 739 | ||||||
Accrued restructuring of $739 at December 31, 2014 is expected to be paid in 2015 over the next three quarters. |
CUSTOMER_AND_SUPPLIER_CONCENTR
CUSTOMER AND SUPPLIER CONCENTRATION | 12 Months Ended |
Dec. 31, 2014 | |
Risks and Uncertainties [Abstract] | |
CUSTOMER AND SUPPLIER CONCENTRATION | CUSTOMER AND SUPPLIER CONCENTRATION |
Direct sales to our top three customers, Spirit AeroSystems, Gulfstream Aerospace Corporation, and The Boeing Company accounted for 34.3%, 15.0% and 10.6% of our total revenues in 2014, respectively. These revenues are reported by both the Aerostructures and Engineering Services segments. Accounts receivable balances related to these customers were 33.3%, 6.1%, and 7.4%, of the accounts receivable balance at December 31, 2014, respectively. | |
Direct sales to our top three customers, Spirit AeroSystems, Gulfstream Aerospace Corporation and The Boeing Company, accounted for 28.5%, 14.6% and 14.4% of our total revenues in 2013, respectively. These revenues are reported by both the Aerostructures and Engineering Services segments. Accounts receivable balances related to these customers were 27.8%, 8.5% and 5.7% of the accounts receivable balance at December 31, 2013, respectively. | |
Direct sales to our top four customers, The Boeing Company, Gulfstream Aerospace Corporation, Spirit AeroSystems, and Bombardier accounted for 20.8%, 16.1%, 13.0% and 10.1% of our total revenues in 2012, respectively. These revenues are reported by both the Aerostructures and Engineering Services segments. Accounts receivable balances related to these customers were 11.3%, 5.6%, 27.9% and 6.4% and of the accounts receivable balance at December 31, 2012, respectively. | |
The Company did not have any sales to a foreign country greater than 10.0% of its total sales in 2014, 2013 and 2012, respectively. The amounts of profitability and identifiable assets attributable to foreign sales activity are not material when compared with revenue, profitability, and identifiable assets attributed to United States domestic operations during 2014, 2013 and 2012. | |
The Company purchased approximately 47.3%, 44.3% and 51.7% of the raw materials and procured parts from its largest five suppliers in, 2014, 2013, and 2012, respectively. |
BUSINESS_SEGMENT_INFORMATION
BUSINESS SEGMENT INFORMATION | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Segment Reporting [Abstract] | ||||||||||||
BUSINESS SEGMENT INFORMATION | BUSINESS SEGMENT INFORMATION | |||||||||||
The Company is organized into two reportable segments: the Aerostructures segment and the Engineering Services segment. The Aerostructures segment fabricates, machines, finishes, integrates, assembles and kits formed and machined close tolerance aluminum, specialty alloy and composite components for use by the aerospace and defense industries. The Engineering Services segment provides a complete range of design, engineering and program management services supporting aircraft lifecycles from conceptual design, analysis and certification through production support, fleet support and service life extensions via a complete turnkey engineering solution. | ||||||||||||
Corporate assets, liabilities and expenses related to the Company’s corporate offices, except for interest expense and income taxes, primarily support the Aerostructures segment. The table below presents information about reported segments on the basis used internally to evaluate segment performance: | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Net sales: | ||||||||||||
Aerostructures | $ | 326,025 | $ | 331,654 | $ | 174,983 | ||||||
Engineering Services | 63,404 | 83,717 | 105,607 | |||||||||
Eliminations | (1,612 | ) | (2,814 | ) | (1,961 | ) | ||||||
$ | 387,817 | $ | 412,557 | $ | 278,629 | |||||||
Gross profit: | ||||||||||||
Aerostructures | $ | 67,042 | $ | 68,088 | $ | 47,947 | ||||||
Engineering Services | 8,428 | 12,145 | 20,270 | |||||||||
Eliminations | (100 | ) | (371 | ) | 91 | |||||||
$ | 75,370 | $ | 79,862 | $ | 68,308 | |||||||
(Loss) income from operations: | ||||||||||||
Aerostructures (1) (4) | $ | 18,977 | $ | (46,050 | ) | $ | 15,484 | |||||
Engineering Services (2) (3) | (27,731 | ) | (2,699 | ) | 10,480 | |||||||
Eliminations | (104 | ) | (371 | ) | 91 | |||||||
$ | (8,858 | ) | $ | (49,120 | ) | $ | 26,055 | |||||
Depreciation, amortization and certain other non-cash charges: | ||||||||||||
Aerostructures (1) | $ | 20,223 | $ | 91,557 | $ | 5,532 | ||||||
Engineering Services (2) (3) | 28,675 | 6,754 | 2,462 | |||||||||
Corporate (4) | $ | — | $ | (7,950 | ) | $ | — | |||||
$ | 48,898 | $ | 90,361 | $ | 7,994 | |||||||
(1)Includes a $73,528 for goodwill impairment in 2013. | ||||||||||||
(2)Includes a $26,439 for goodwill impairment in 2014. | ||||||||||||
(3)Includes a $4,222 charge for impairment of intangible 2013. | ||||||||||||
(4)Includes the write-off of contingent consideration of $7,950 in 2013. | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Interest expense: | ||||||||||||
Aerostructures | $ | 1,041 | $ | 1,054 | $ | 23 | ||||||
Engineering Services | 41 | 53 | 25 | |||||||||
Corporate (1) | 28,198 | 15,855 | 1,723 | |||||||||
$ | 29,280 | $ | 16,962 | $ | 1,771 | |||||||
(1) Includes $8,466 and $580 related to the write-off of deferred financing costs in 2014 and 2012, respectively. | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Capital expenditures: | ||||||||||||
Aerostructures (1) | $ | 16,504 | $ | 23,600 | $ | 18,649 | ||||||
Engineering Services | 186 | 549 | 880 | |||||||||
$ | 16,690 | $ | 24,149 | $ | 19,529 | |||||||
(1) Includes $411 and $746 associated with capital leases in 2013 and 2012, respectively. | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | |||||||||||
Total assets: | ||||||||||||
Aerostructures | $ | 399,689 | $ | 405,779 | ||||||||
Engineering | 42,747 | 74,272 | ||||||||||
$ | 442,436 | $ | 480,051 | |||||||||
QUARTERLY_FINANCIAL_DATA_UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
QUARTERLY FINANCIAL DATA (UNAUDITED) | QUARTERLY FINANCIAL DATA (UNAUDITED) | |||||||||||||||
The results of any single quarter are not necessarily indicative of the Company’s results for the full year. Earnings per share data is computed independently for each of the periods presented. As a result, the sum of the earnings per share amounts for the quarter may not equal the total for the year. | ||||||||||||||||
2014 | First (1) | Second (2) | Third (3) | Fourth (4) | ||||||||||||
Net sales | $ | 95,751 | $ | 105,937 | $ | 97,335 | $ | 88,794 | ||||||||
Gross profit (3) | $ | 17,461 | $ | 19,134 | $ | 22,043 | $ | 16,732 | ||||||||
Net (loss) income (1,2,3,4) | $ | (442 | ) | $ | (7,411 | ) | $ | 1,396 | $ | (22,505 | ) | |||||
Amounts per common share: | ||||||||||||||||
Net (loss) income | $ | (0.03 | ) | $ | (0.58 | ) | $ | 0.11 | $ | (1.76 | ) | |||||
Net (loss) income - assuming dilution | $ | (0.03 | ) | $ | (0.58 | ) | $ | 0.11 | $ | (1.76 | ) | |||||
2013 | First (5) | Second (6) | Third | Fourth (7) | ||||||||||||
Net sales | $ | 106,066 | $ | 105,465 | $ | 104,656 | $ | 96,370 | ||||||||
Gross profit (5,7) | $ | 20,054 | $ | 21,841 | $ | 20,418 | $ | 17,549 | ||||||||
Net income (loss) (5),(6),(7) | $ | 1,837 | $ | 4,664 | $ | 2,075 | $ | (67,061 | ) | |||||||
Amounts per common share: | ||||||||||||||||
Net income | $ | 0.15 | $ | 0.37 | $ | 0.16 | $ | (5.31 | ) | |||||||
Net income - assuming dilution | $ | 0.14 | $ | 0.37 | $ | 0.16 | $ | (5.31 | ) | |||||||
(1) Included in the net loss for the the first quarter of 2014 were $428 of restructuring expenses. | ||||||||||||||||
-2 | Net loss in the second quarter of 2014 includes $793 of interest expense related to the termination of interest rate derivatives and $8,340 related to the write-off of debt issuance costs associated with the modification of the Company's revolving credit facility and the termination of its long-term credit agreement. Net loss in the second quarter of 2014 also includes $1,095 of restructuring expenses. | |||||||||||||||
-3 | Gross profit in the third quarter of 2014 includes a $5,286 favorable cumulative catch-up adjustment related to the settlement of an unpriced change order and the Company's ability to secure more favorable future material pricing on a long-term production contract. In addition, net income in the third quarter of 2014 includes $765 of restructuring expenses. | |||||||||||||||
-4 | Net loss in the fourth quarter of 2014 includes a $26,439 goodwill impairment charge related to the Engineering Services reporting unit, $228 of restructuring expenses and a $6,396 income tax benefit resulting from the decision to carry the 2014 tax loss back to previous years. | |||||||||||||||
(5) The first quarter of 2013 included $2,497 of non-recurring inventory step-up related to the Valent acquisition. | ||||||||||||||||
-6 | The second quarter of 2013 included a trade name impairment of $4,222 related to D3 Technologies offset by a contingent consideration write-off of $7,950 related to Valent. | |||||||||||||||
-7 | The fourth quarter of 2013 included a goodwill impairment charge of $73,528 related to the Valent acquisition, $17,718 related to income tax valuation allowance, $2,620 related to a separation agreement reached with key members of Valent Aerostructures, LLC. and $453 of restructuring expenses related to the closure of the Precise Machine facility. In addition, Valent gross profit was unfavorably impacted by $955 in cumulative catch-up adjustments, the result of higher levels of indirect costs required to meet customer demand. |
CONDENSED_CONSOLIDATING_FINANC
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (Notes) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ||||||||||||||||
Condensed Consolidating Financial Information | CONDENSED CONSOLIDATING FINANCIAL INFORMATION | |||||||||||||||
LMI Aerospace, Inc. excluding its subsidiaries (“LMIA”) is the parent company, issuer and obligor of the second-priority senior notes due June 19, 2019 (the “Notes”). The payment obligations of LMIA under the Notes are guaranteed and secured by LMIA and all of its subsidiaries other than immaterial subsidiaries as further described below. | ||||||||||||||||
These notes are guaranteed on a second-priority senior secured basis, jointly and severally, by LMIA (“Guarantor Parent”) and all of its existing and future 100% owned subsidiaries (collectively, the “Guarantor Subsidiaries”) other than immaterial subsidiaries. Such guaranties are full and unconditional. LMIA conducts substantially all of its business through and derives virtually all of its income from its subsidiaries. Therefore, its ability to make required principal and interest payments with respect to its indebtedness depends on the earnings of subsidiaries and its ability to receive funds from its subsidiaries. | ||||||||||||||||
The notes are secured on a second-priority basis by liens on substantially all of LMIA’s and the Guarantor Subsidiaries’ assets, subject to certain exceptions and permitted liens. The liens securing the notes are contractually subordinated to the liens that secure indebtedness under the revolving credit facility as a result of the lien subordination provisions of the intercreditor agreement to the extent of the value of the collateral securing such indebtedness as well as being subordinated by other existing indebtedness, including industrial revenue bonds, capital leases and other notes payable, to the extent of the value of the collateral that secures such existing indebtedness. As a consequence of this lien subordination and existing indebtedness the notes and the guarantees are effectively subordinated to the extent of the value of the collateral that secures them. Decisions regarding the maintenance and release of the collateral secured by the collateral agreement are made by the lenders under the modified revolving credit facility, and neither the indenture trustee nor the holders of the Notes have control of decisions regarding the release of collateral. | ||||||||||||||||
We have not presented separate financial statements and separate disclosures have not been provided concerning the Guarantor Subsidiaries due to the presentation of condensed consolidating financial information set forth in this Note, consistent with the Securities and Exchange Commission (the “SEC”) interpretations governing reporting of subsidiary financial information. | ||||||||||||||||
Supplemental condensed consolidating financial information of the Company, including such information for the Guarantor Subsidiaries, is presented below. Investments in subsidiaries are presented using the equity method of accounting. The principal elimination entries eliminate investments in subsidiaries and inter-company balances and transactions. | ||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEET | ||||||||||||||||
31-Dec-14 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Assets | ||||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 7,058 | $ | 869 | $ | — | $ | 7,927 | ||||||||
Trade accounts receivable, net | 1,310 | 56,924 | — | 58,234 | ||||||||||||
Intercompany receivables | 145,980 | 145,223 | (291,203 | ) | — | |||||||||||
Inventories | — | 114,279 | — | 114,279 | ||||||||||||
Prepaid expenses and other current assets | 8,325 | 1,930 | — | 10,255 | ||||||||||||
Deferred income taxes | — | 4,031 | (118 | ) | 3,913 | |||||||||||
Total current assets | 162,673 | 323,256 | (291,321 | ) | 194,608 | |||||||||||
Property, plant and equipment, net | 3,148 | 96,334 | — | 99,482 | ||||||||||||
Investments in subsidiaries | 368,587 | (368,587 | ) | — | ||||||||||||
Goodwill | — | 86,784 | — | 86,784 | ||||||||||||
Intangible assets, net | — | 50,940 | — | 50,940 | ||||||||||||
Deferred income taxes | 118 | — | (118 | ) | — | |||||||||||
Other assets | 8,743 | 1,879 | — | 10,622 | ||||||||||||
Total assets | $ | 543,269 | $ | 559,193 | $ | (660,026 | ) | $ | 442,436 | |||||||
Liabilities and shareholders’ equity | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Accounts payable | $ | 1,339 | $ | 20,416 | $ | — | $ | 21,755 | ||||||||
Accrued expenses | 13,679 | 12,393 | — | 26,072 | ||||||||||||
Intercompany Payables | 164,158 | 127,045 | (291,203 | ) | $ | — | ||||||||||
Deferred income taxes | 118 | — | (118 | ) | — | |||||||||||
Current installments of long-term debt and capital lease obligations | 335 | 3,089 | — | 3,424 | ||||||||||||
Total current liabilities | 179,629 | 162,943 | (291,321 | ) | 51,251 | |||||||||||
Long-term debt and capital lease obligations, less current installments | 245,174 | 20,380 | — | 265,554 | ||||||||||||
Other long-term liabilities | 331 | 2,958 | — | 3,289 | ||||||||||||
Deferred income taxes | — | 4,325 | (118 | ) | 4,207 | |||||||||||
Total long-term liabilities | 245,505 | 27,663 | (118 | ) | 273,050 | |||||||||||
Total shareholders’ equity | 118,135 | 368,587 | (368,587 | ) | 118,135 | |||||||||||
Total liabilities and shareholders’ equity | $ | 543,269 | $ | 559,193 | $ | (660,026 | ) | $ | 442,436 | |||||||
CONDENSED CONSOLIDATING BALANCE SHEET | ||||||||||||||||
31-Dec-13 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Assets | ||||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 405 | $ | 1,167 | $ | — | $ | 1,572 | ||||||||
Trade accounts receivable, net | 14,783 | 58,070 | — | 72,853 | ||||||||||||
Intercompany receivables | 152,143 | 142,111 | (294,254 | ) | $ | — | ||||||||||
Inventories | — | 113,178 | — | 113,178 | ||||||||||||
Prepaid expenses and other current assets | 2,385 | 2,026 | — | 4,411 | ||||||||||||
Deferred income taxes | — | 2,800 | (107 | ) | 2,693 | |||||||||||
Total current assets | 169,716 | 319,352 | (294,361 | ) | 194,707 | |||||||||||
Property, plant and equipment, net | 7,022 | 96,353 | — | 103,375 | ||||||||||||
Investments in subsidiaries | 378,707 | — | (378,707 | ) | — | |||||||||||
Goodwill | — | 113,223 | — | 113,223 | ||||||||||||
Intangible assets, net | — | 55,465 | — | 55,465 | ||||||||||||
Deferred income taxes | 135 | — | (135 | ) | — | |||||||||||
Other assets | 11,152 | 2,129 | — | 13,281 | ||||||||||||
Total assets | $ | 566,732 | $ | 586,522 | $ | (673,203 | ) | $ | 480,051 | |||||||
Liabilities and shareholders’ equity | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Accounts payable | $ | 3,415 | $ | 16,489 | $ | — | $ | 19,904 | ||||||||
Accrued expenses | 2,560 | 16,006 | — | 18,566 | ||||||||||||
Intercompany Payables | 152,743 | 141,511 | (294,254 | ) | $ | — | ||||||||||
Deferred income taxes | 135 | — | (135 | ) | — | |||||||||||
Current installments of long-term debt and capital lease obligations | 2,827 | 2,415 | — | 5,242 | ||||||||||||
Total current liabilities | 161,680 | 176,421 | (294,389 | ) | 43,712 | |||||||||||
Long-term debt and capital lease obligations, less current installments | 260,148 | 25,221 | — | 285,369 | ||||||||||||
Other long-term liabilities | 760 | 3,155 | — | 3,915 | ||||||||||||
Deferred income taxes | — | 3,018 | (107 | ) | 2,911 | |||||||||||
Total long-term liabilities | 260,908 | 31,394 | (107 | ) | 292,195 | |||||||||||
Total shareholders’ equity | 144,144 | 378,707 | (378,707 | ) | 144,144 | |||||||||||
Total liabilities and shareholders’ equity | $ | 566,732 | $ | 586,522 | $ | (673,203 | ) | $ | 480,051 | |||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||
31-Dec-14 | ||||||||||||||||
(Amounts in thousands, except share and per share data) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Sales and service revenue | ||||||||||||||||
Product sales | $ | 466 | $ | 321,286 | $ | (468 | ) | $ | 321,284 | |||||||
Service revenues | 36,181 | 66,543 | (36,191 | ) | 66,533 | |||||||||||
Net sales | 36,647 | 387,829 | (36,659 | ) | 387,817 | |||||||||||
Cost of sales and service revenue | ||||||||||||||||
Cost of product sales | 699 | 254,544 | (468 | ) | 254,775 | |||||||||||
Cost of service revenues | 35,998 | 57,864 | (36,190 | ) | 57,672 | |||||||||||
Cost of sales | 36,697 | 312,408 | (36,658 | ) | 312,447 | |||||||||||
Gross profit | (50 | ) | 75,421 | (1 | ) | 75,370 | ||||||||||
Selling, general and administrative expenses | 792 | 54,412 | — | 55,204 | ||||||||||||
Goodwill and intangible asset impairment | — | 26,439 | — | 26,439 | ||||||||||||
Contingent consideration write-off | — | — | — | — | ||||||||||||
Restructuring expense | 1,011 | 1,574 | — | 2,585 | ||||||||||||
Acquisitions expense | — | — | — | — | ||||||||||||
(Loss) income from operations | (1,853 | ) | (7,004 | ) | (1 | ) | (8,858 | ) | ||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (28,224 | ) | (1,056 | ) | — | (29,280 | ) | |||||||||
Other, net | 11 | 212 | — | 223 | ||||||||||||
Income (loss) from equity investments in subsidiaries | (8,860 | ) | — | 8,860 | — | |||||||||||
Total other expense | (37,073 | ) | (844 | ) | 8,860 | (29,057 | ) | |||||||||
(Loss) income before income taxes | (38,926 | ) | (7,848 | ) | 8,859 | (37,915 | ) | |||||||||
(Benefit) provision for income taxes | (9,867 | ) | 914 | — | (8,953 | ) | ||||||||||
Net (loss) income | (29,059 | ) | (8,762 | ) | 8,859 | (28,962 | ) | |||||||||
Other comprehensive income (loss): | ||||||||||||||||
Change in foreign currency translation adjustment | — | (98 | ) | — | (98 | ) | ||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | 278 | — | — | 278 | ||||||||||||
Unrealized loss on interest rate hedges | — | — | — | — | ||||||||||||
Total comprehensive (loss) income | $ | (28,781 | ) | $ | (8,860 | ) | $ | 8,859 | $ | (28,782 | ) | |||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||
31-Dec-13 | ||||||||||||||||
(Amounts in thousands, except share and per share data) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Sales and service revenue | ||||||||||||||||
Product sales | $ | 4,388 | $ | 324,455 | $ | (4,710 | ) | $ | 324,133 | |||||||
Service revenues | 41,578 | 88,141 | (41,295 | ) | 88,424 | |||||||||||
Net sales | 45,966 | 412,596 | (46,005 | ) | 412,557 | |||||||||||
Cost of sales and service revenue | ||||||||||||||||
Cost of product sales | 4,290 | 255,681 | (4,710 | ) | 255,261 | |||||||||||
Cost of service revenues | 41,533 | 77,124 | (41,223 | ) | 77,434 | |||||||||||
Cost of sales | 45,823 | 332,805 | (45,933 | ) | 332,695 | |||||||||||
Gross profit | 143 | 79,791 | (72 | ) | 79,862 | |||||||||||
Selling, general and administrative expenses | — | 55,862 | — | 55,862 | ||||||||||||
Goodwill and intangible asset impairment | — | 77,750 | — | 77,750 | ||||||||||||
Contingent consideration write-off | (7,950 | ) | — | — | (7,950 | ) | ||||||||||
Restructuring expense | 4 | 3,069 | — | 3,073 | ||||||||||||
Acquisitions expense | 229 | 18 | — | 247 | ||||||||||||
(Loss) income from operations | 7,860 | (56,908 | ) | (72 | ) | (49,120 | ) | |||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (15,887 | ) | (1,075 | ) | — | (16,962 | ) | |||||||||
Other, net | 95 | 523 | — | 618 | ||||||||||||
Income (loss) from equity investments in subsidiaries | (52,206 | ) | — | 52,206 | — | |||||||||||
Total other expense | (67,998 | ) | (552 | ) | 52,206 | (16,344 | ) | |||||||||
(Loss) income before income taxes | (60,138 | ) | (57,460 | ) | 52,134 | (65,464 | ) | |||||||||
(Benefit) provision for income taxes | (1,702 | ) | (5,277 | ) | — | (6,979 | ) | |||||||||
Net (loss) income | (58,436 | ) | (52,183 | ) | 52,134 | (58,485 | ) | |||||||||
Other comprehensive income (loss): | ||||||||||||||||
Change in foreign currency translation adjustment | — | (23 | ) | — | (23 | ) | ||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | — | — | — | — | ||||||||||||
Unrealized loss on interest rate hedges | (278 | ) | — | — | (278 | ) | ||||||||||
Total comprehensive (loss) income | $ | (58,714 | ) | $ | (52,206 | ) | $ | 52,134 | $ | (58,786 | ) | |||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||
31-Dec-12 | ||||||||||||||||
(Amounts in thousands, except share and per share data) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Sales and service revenue | ||||||||||||||||
Product sales | $ | 825 | $ | 169,000 | $ | (882 | ) | $ | 168,943 | |||||||
Service revenues | 36,713 | 109,616 | (36,643 | ) | 109,686 | |||||||||||
Net sales | 37,538 | 278,616 | (37,525 | ) | 278,629 | |||||||||||
Cost of sales and service revenue | ||||||||||||||||
Cost of product sales | 772 | 121,357 | (882 | ) | 121,247 | |||||||||||
Cost of service revenues | 36,706 | 88,964 | (36,596 | ) | 89,074 | |||||||||||
Cost of sales | 37,478 | 210,321 | (37,478 | ) | 210,321 | |||||||||||
Gross profit | 60 | 68,295 | (47 | ) | 68,308 | |||||||||||
Selling, general and administrative expenses | — | 36,891 | — | 36,891 | ||||||||||||
Goodwill and intangible asset impairment | — | — | — | — | ||||||||||||
Contingent consideration write-off | — | — | — | — | ||||||||||||
Restructuring expense | — | — | — | — | ||||||||||||
Acquisitions expense | 5,337 | 25 | — | 5,362 | ||||||||||||
(Loss) income from operations | (5,277 | ) | 31,379 | (47 | ) | 26,055 | ||||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (1,727 | ) | (44 | ) | — | (1,771 | ) | |||||||||
Other, net | 7 | 349 | — | 356 | ||||||||||||
Income (loss) from equity investments in subsidiaries | 20,977 | — | (20,977 | ) | — | |||||||||||
Total other expense | 19,257 | 305 | (20,977 | ) | (1,415 | ) | ||||||||||
(Loss) income before income taxes | 13,980 | 31,684 | (21,024 | ) | 24,640 | |||||||||||
(Benefit) provision for income taxes | (2,507 | ) | 10,660 | — | 8,153 | |||||||||||
Net (loss) income | 16,487 | 21,024 | (21,024 | ) | 16,487 | |||||||||||
Other comprehensive income (loss): | ||||||||||||||||
Change in foreign currency translation adjustment | — | (49 | ) | — | (49 | ) | ||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | — | — | — | — | ||||||||||||
Unrealized loss on interest rate hedges | — | — | — | — | ||||||||||||
Total comprehensive (loss) income | $ | 16,487 | $ | 20,975 | $ | (21,024 | ) | $ | 16,438 | |||||||
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | ||||||||||||||||
For the Year ended December 31, 2014 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Operating activities: | ||||||||||||||||
Net (loss)/income | $ | (29,059 | ) | $ | (8,762 | ) | $ | 8,859 | $ | (28,962 | ) | |||||
Adjustments for non-cash items | 21,713 | 46,497 | (8,859 | ) | 59,351 | |||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | 19,977 | (1,249 | ) | — | 18,728 | |||||||||||
Intercompany activity | 17,663 | (17,663 | ) | — | — | |||||||||||
Net cash (used)/provided by operating activities | 30,294 | 18,823 | — | 49,117 | ||||||||||||
Investing activities: | ||||||||||||||||
Additions to property, plant and equipment | (715 | ) | (15,975 | ) | — | (16,690 | ) | |||||||||
Acquisitions, net of cash acquired | — | — | — | — | ||||||||||||
Proceeds from sale of equipment | 2,558 | 1,021 | — | 3,579 | ||||||||||||
Net cash used by investing activities | 1,843 | (14,954 | ) | — | (13,111 | ) | ||||||||||
Financing activities: | ||||||||||||||||
Proceeds from issuance of debt | 250,000 | — | — | 250,000 | ||||||||||||
Principal payments on long-term debt and notes payable | (231,466 | ) | (4,167 | ) | — | (235,633 | ) | |||||||||
Advances on revolving line of credit | 66,000 | — | — | 66,000 | ||||||||||||
Payments on revolving line of credit | (102,000 | ) | — | — | (102,000 | ) | ||||||||||
Payments for debt issuance cost | (8,018 | ) | — | — | (8,018 | ) | ||||||||||
Other, net | — | — | — | — | ||||||||||||
Net cash provided (used) by financing activities | (25,484 | ) | (4,167 | ) | — | (29,651 | ) | |||||||||
Net (decrease) increase in cash and cash equivalents | 6,653 | (298 | ) | — | 6,355 | |||||||||||
Cash and cash equivalents, beginning of year | 405 | 1,167 | — | 1,572 | ||||||||||||
Cash and cash equivalents, end of year | $ | 7,058 | $ | 869 | $ | — | $ | 7,927 | ||||||||
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | ||||||||||||||||
For the Year ended December 31, 2013 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Operating activities: | ||||||||||||||||
Net (loss)/income | $ | (58,436 | ) | $ | (52,183 | ) | $ | 52,134 | $ | (58,485 | ) | |||||
Adjustments for non-cash items | 46,716 | 90,913 | (52,134 | ) | 85,495 | |||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | 696 | (36,055 | ) | — | (35,359 | ) | ||||||||||
Intercompany activity | (12,974 | ) | 12,974 | — | — | |||||||||||
Net cash (used)/provided by operating activities | (23,998 | ) | 15,649 | — | (8,349 | ) | ||||||||||
Investing activities: | ||||||||||||||||
Additions to property, plant and equipment | (4,623 | ) | (19,115 | ) | — | (23,738 | ) | |||||||||
Acquisitions, net of cash acquired | (504 | ) | — | — | (504 | ) | ||||||||||
Proceeds from sale of equipment | — | 1,989 | — | 1,989 | ||||||||||||
Net cash used by investing activities | (5,127 | ) | (17,126 | ) | — | (22,253 | ) | |||||||||
Financing activities: | ||||||||||||||||
Proceeds from issuance of debt | 3,551 | 2,200 | — | 5,751 | ||||||||||||
Principal payments on long-term debt and notes payable | (5,767 | ) | (96 | ) | — | (5,863 | ) | |||||||||
Advances on revolving line of credit | 107,000 | — | — | 107,000 | ||||||||||||
Payments on revolving line of credit | (77,236 | ) | — | — | (77,236 | ) | ||||||||||
Payments for debt issuance cost | (1,780 | ) | (37 | ) | — | (1,817 | ) | |||||||||
Other, net | (8 | ) | — | — | (8 | ) | ||||||||||
Net cash provided (used) by financing activities | 25,760 | 2,067 | — | 27,827 | ||||||||||||
Net (decrease) increase in cash and cash equivalents | (3,365 | ) | 590 | — | (2,775 | ) | ||||||||||
Cash and cash equivalents, beginning of year | 3,770 | 577 | — | 4,347 | ||||||||||||
Cash and cash equivalents, end of year | $ | 405 | $ | 1,167 | $ | — | $ | 1,572 | ||||||||
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | ||||||||||||||||
For the Year ended December 31, 2012 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Operating activities: | ||||||||||||||||
Net (loss)/income | $ | 16,487 | $ | 21,024 | $ | (21,024 | ) | $ | 16,487 | |||||||
Adjustments for non-cash items | (28,544 | ) | 15,411 | 21,242 | 8,109 | |||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | 2,195 | (17,993 | ) | 1 | (15,797 | ) | ||||||||||
Intercompany activity | 912 | (693 | ) | (219 | ) | — | ||||||||||
Net cash (used)/provided by operating activities | (8,950 | ) | 17,749 | — | 8,799 | |||||||||||
Investing activities: | ||||||||||||||||
Additions to property, plant and equipment | (406 | ) | (18,377 | ) | — | (18,783 | ) | |||||||||
Acquisitions, net of cash acquired | (216,398 | ) | — | — | (216,398 | ) | ||||||||||
Proceeds from sale of equipment | 11 | 170 | — | 181 | ||||||||||||
Net cash used by investing activities | (216,793 | ) | (18,207 | ) | — | (235,000 | ) | |||||||||
Financing activities: | ||||||||||||||||
Proceeds from issuance of debt | 228,123 | 1,001 | — | 229,124 | ||||||||||||
Principal payments on long-term debt and notes payable | (118 | ) | — | — | (118 | ) | ||||||||||
Advances on revolving line of credit | 40,278 | — | — | 40,278 | ||||||||||||
Payments on revolving line of credit | (34,042 | ) | — | — | (34,042 | ) | ||||||||||
Payments for debt issuance cost | (12,736 | ) | — | — | (12,736 | ) | ||||||||||
Other, net | 174 | — | — | 174 | ||||||||||||
Net cash provided (used) by financing activities | 221,679 | 1,001 | — | 222,680 | ||||||||||||
Net (decrease) increase in cash and cash equivalents | (4,064 | ) | 543 | — | (3,521 | ) | ||||||||||
Cash and cash equivalents, beginning of year | 7,834 | 34 | — | 7,868 | ||||||||||||
Cash and cash equivalents, end of year | $ | 3,770 | $ | 577 | $ | — | $ | 4,347 | ||||||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS |
In January of 2015, the Company signed an agreement with Spirit Aerostructures ("Spirit") to form a strategically aligned partnership. This agreement extends the performance period of the statements of work for certain contracts with Spirit and gives the Company preferred supplier status on certain future contracts. In accordance with the contract terms, the Company made a $4,800 cash payment of consideration to Spirit in January of 2015. Additional consideration of $1,700 will be paid to Spirit should certain contract milestones be met. This additional payment could occur as early as March of 2015. | |
On February 2, 2015, Jennifer Alfaro joined the Company as Chief Human Resources Officer. | |
On February 9, 2015, in response to the challenges facing its Engineering Services business, the Company appointed Brian P. Olsen, the Company's Executive Director of Business Development, as Acting President, Engineering Services. Jay Inman, the former President of Engineering Services, assumed the role of Acting Chief Operating Officer, Engineering Services. | |
On March 4, 2015, Joseph Burstein notified the Board of his intention to retire form the Board, effective March 6, 2015. | |
On March 5, 2015, the Board appointed Steven K. Schaffer as a Class III Director, effective April 1, 2015, to fill the vacancy left by the retirement of Joseph Burstein. |
SCHEDULE_II_VALUATION_AND_QUAL
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | LMI AEROSPACE, INC. | ||||||||||||||||||||
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | |||||||||||||||||||||
(Dollar amounts in thousands) | |||||||||||||||||||||
December 31, 2014 | |||||||||||||||||||||
Beginning | Charge | Other | Write-offs | Ending Balance | |||||||||||||||||
Balance | to Cost/ | Charge | net of | ||||||||||||||||||
Expense | to Cost/ | Recoveries | |||||||||||||||||||
Expense | |||||||||||||||||||||
Reserve for Accounts Receivable | |||||||||||||||||||||
Year ended December 31, 2012 | $ | 359 | $ | (140 | ) | $ | 86 | $ | (18 | ) | $ | 287 | |||||||||
Year ended December 31, 2013 | $ | 287 | $ | (27 | ) | $ | — | $ | (80 | ) | $ | 180 | |||||||||
Year ended December 31, 2014 | $ | 180 | $ | 309 | $ | — | $ | (25 | ) | $ | 464 | ||||||||||
Income Tax Valuation Allowance | |||||||||||||||||||||
Year ended December 31, 2012 | $ | — | $ | 261 | $ | — | $ | — | $ | 261 | |||||||||||
Year ended December 31, 2013 | $ | 261 | $ | 17,876 | $ | — | $ | — | $ | 18,137 | |||||||||||
Year ended December 31, 2014 | $ | 18,137 | $ | — | $ | (5,461 | ) | $ | — | $ | 12,676 | ||||||||||
ACCOUNTING_POLICIES_Policies
ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
Principles of Consolidation | Principles of Consolidation | ||||||||
The Consolidated Financial Statements included in this report have been prepared by management of LMI Aerospace, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. | |||||||||
Use of Estimates | Use of Estimates | ||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions. These estimates and assumptions affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from these estimates. | |||||||||
Revenue Recognition | Revenue and Profit Recognition | ||||||||
Except as described below, the Company recognizes revenue for sales of products and related services in accordance with Financial Accounting Standards Board, (“FASB”) Accounting Standards Codification (“ASC”) Topic 605-15 Products and Topic 605-20 Services. The Company sells products under long term supply contracts and purchase orders where the product is built to the customer specifications based on firm purchase orders from the customer. The purchase orders tend to be of a relatively short duration and customers place orders on a periodic basis. The pricing is generally fixed for some length of time and the quantities are based on individual purchase orders. Revenue is recognized when title passes and services are rendered, the price is fixed or determinable, and collection is reasonably assured. Approximately 80.0% to 90.0% of the total revenue the Company recognized in any given quarter is accounted for in accordance with Topics 15 and 20. The remainder of the revenue is accounted for using methods consistent with ASC Topic 605-35 Construction-Type and Production-Type Contracts. | |||||||||
The percentage of completion method used to account for contracts depends on the nature of the products provided under the contract. For example, for contracts that require us to perform a significant level of development effort, in comparison to the total value of the contract, sales are recorded using the cost to cost method to measure progress toward completion. Under the cost to cost method of accounting, we recognize sales and estimated profit as costs are incurred based on the proportion that the incurred costs bare compared to total estimated costs. For contracts that require us to provide a substantial number of similar items without a significant level of development, we record sales and estimated profit on a percentage of completion basis using units of delivery as the basis to measure progress toward completing the contract. Under both methods, profit recognized is based on the total expected profit margin percentage multiplied by revenue recognized to date. | |||||||||
The Company periodically reviews all estimates to complete as required by the authoritative guidance and the estimated total cost and expected gross profit are revised as required over the life of the contract. Any revisions to the estimated total cost are accounted for as a change of an estimate. A cumulative catch-up adjustment is recorded in the period of the change of the estimated costs to complete the contract. | |||||||||
In addition, should total estimated costs at completion exceed the estimated total revenue, the anticipated full loss is recognized in the period in which the anticipated loss is determined. The loss is reported as a component of cost of sales. The Company does not have any cost to cost contracts with an anticipated loss. At December 31, 2013, the Company had a contract accounted for using the units of delivery method which was acquired during the Valent acquisition and where estimated costs exceeded the total contract revenue. The provision for anticipated loss was established in 2013 for $5,267 and was treated as a measurement period change and as such increased the goodwill related to the Valent acquisition. During the third quarter of 2014, a change was agreed to that resulted in the favorable settlement of an unpriced change order related to this contract. In addition, the Company secured more favorable future material pricing with respect to this contract as engineering changes to the related assemblies had stabilized. As a result, contract costs are no longer expected to exceed revenue and the remaining related loss reserve was reversed, resulting in a favorable cumulative catch up adjustment of $5,267 in the year ended December 31, 2014. The reversal was recorded in the cost of goods sold section of the Consolidated Statements of Comprehensive Income (Loss). | |||||||||
Cumulative catch-up adjustments had the following impact to operating income in the years presented: | |||||||||
2014 | 2013 | 2012 | |||||||
Favorable adjustments | 5,720 | 106 | 587 | ||||||
Unfavorable adjustments | (1,719 | ) | (1,609 | ) | (519 | ) | |||
Net operating income adjustments | 4,001 | (1,503 | ) | 68 | |||||
The net favorable cumulative catch-up adjustments in 2014 relate primarily to two contracts. The favorable adjustments are primarily associated with the aforementioned Valent contract of $5,267. The unfavorable cumulative catch-up adjustments recorded in 2014 primarily relate to unforeseen failures during the test phase of a design program on the Mitsubishi Regional Jet. The adjustment related to this program was $1,479 and was recorded as a reduction to revenue in the Consolidated Statements of Comprehensive Income (Loss). | |||||||||
The negative cumulative catch-up adjustments in 2013 relate primarily to two contracts. The first contract relates to a design program for 787 shipping fixtures on which the Company was unable to pass through as much of the engineering changes incurred to the customer as originally estimated. The Company recorded a reduction of contact revenue of $811 for this program in 2013. The second contract relates to the design portion of the Embraer KC-390 program. In 2013, an adjustment of $706 was recorded to reflect a revision in the expected labor hours necessary to complete the program. | |||||||||
For contracts accounted for using the percentage of completion method, management’s estimates of total units to be produced, and material, labor and overhead costs on long-term contracts are critical to the Company. Due to the size, length of time and nature of many of our contracts, the estimation of revenue and costs through completion is complicated and subject to many variables. Claims and unpriced change orders will impact the estimate of total revenues and profits. In the ordinary course of business, the Company may receive requests from its customers to perform tasks not specified in its contracts. When this occurs on a long-term contract using the cost-to-cost method of percentage of completion accounting, the Company may record revenue for claims or unpriced change orders to be negotiated with customers. Approximately 0.1% of the Company's revenue recognized in 2014 represented amounts associated with claims and unpriced change orders. Total contract cost estimates are largely based our current cost of production, purchase order terms negotiated or estimated by our supply chain. | |||||||||
The development of a contract revenue and gross margin percentage involves utilization of detailed procedures by a team of operational and financial personnel that provides information on the status of the contracts. Estimates of revenue and costs associated with each significant contract are reviewed and approved by the team on a quarterly basis. | |||||||||
Due to the significance of the judgment in the estimation process described above, it is possible that materially different margins could be recorded if we used different assumptions or if the underlying circumstances were to change. | |||||||||
Pre-Contract and Pre-Production Costs under Long-Term Supply Contracts | Pre-Contract and Pre-Production Costs under Long-Term Supply Contracts | ||||||||
In certain circumstances, the Company capitalizes costs incurred prior to the execution of a contract with the customer. These circumstances are limited to instances in which the Company has substantially negotiated the terms and conditions of the anticipated contract with its customers and concluded that their recoverability from the anticipated contract is probable. As these costs are directly associated with a specific anticipated contract and they are concluded to be recoverable under that anticipated contract, the Company has capitalized these amounts. | |||||||||
The Company may incur design and development costs prior to the production phase of contracts that are outside the scope of the contract accounting method. These pre-production costs are generally related to costs the Company incurs to design and build tooling that is owned by the customer and design and engineering services. The Company receives the non-cancellable right to use these tools to build the parts as specified in a contractual agreement and therefore has capitalized these costs. In certain instances, the Company enters into agreements with its customers that provide it a contractual guarantee for reimbursement of design and engineering services incurred prior to the production phase of a contract. Due to the contractual guarantee, the Company capitalizes the costs of these services. The pre-production costs are amortized to cost of sales over the shorter of the life of the contractual agreement or the related tooling. | |||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents | ||||||||
Cash and cash equivalents include cash on hand, deposits in transit and all highly liquid investment instruments with an initial maturity of three months or less. | |||||||||
Inventories | Inventories | ||||||||
The Company’s inventories are stated at the lower of cost or market and utilize actual costs for raw materials and average or standard cost (which approximates actual cost) for work in process, manufactured and purchased components and finished goods. The Company evaluates the inventory carrying value and reduces the carrying costs based on customer activity, estimated future demand, price deterioration, and other relevant information. The Company’s customer demand is unpredictable and may fluctuate due to factors beyond the Company’s control. In addition, inventoried costs include capitalized contract costs relating to programs and contracts with long-term production cycles, a portion of which is not expected to be realized within one year. See further discussion regarding deferred long-term contract costs under “Revenue and Profit Recognition” and “Pre-Contract and Pre-Production Costs under Long-Term Supply Contracts.” | |||||||||
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts | ||||||||
The allowance for doubtful accounts receivable reflects the Company’s best estimate of probable losses inherent in its accounts receivable. The basis used to determine this value is derived from historical experience, specific allowances for known troubled customers and other known information. | |||||||||
Property, Plant and Equipment | Property, Plant and Equipment | ||||||||
Property, plant and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful lives of the assets. Estimated useful lives for buildings, machinery and equipment, and purchased software are 20 to 35 years, 4 to 10 years and 3 to 4 years, respectively. Amortization incurred under capital leases is reported with depreciation expense. | |||||||||
Long-Lived Assets | Long Lived Assets | ||||||||
Long lived assets held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. | |||||||||
Goodwill and Intangible Assets | Goodwill and Intangible Assets | ||||||||
The Company’s acquisitions involve the purchase of tangible and intangible assets and the assumption of certain liabilities. As part of the purchase price allocation, the Company allocates the purchase price to the tangible assets acquired and liabilities assumed based on estimated fair market values, and the remainder of the purchase price is allocated to intangibles and goodwill. Goodwill and intangible assets with indefinite lives are not amortized but are subject to an impairment assessment at least annually in relation to their fair value. Under guidelines established by FASB ASC Topic 280, the Company operates in two operating segments. However, the Company has recorded its goodwill and conducts testing for potential goodwill impairment at a reporting unit level. The reporting units represent a business for which discrete financial information is available, and segment management regularly reviews the operating results. As part of this process, the Company first assesses qualitatively whether it is necessary to perform the quantitative test. The qualitative assessment involves evaluating relevant events or circumstances to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If it is, the Company can bypass the quantitative assessment of goodwill. If it is not, or if the Company has elected to bypass the qualitative assessment process, the quantitative assessment of goodwill utilizes a two-step process, where the carrying value of the reporting unit is compared to its fair value. If the carrying value is less than the fair value, no impairment exists, and the second step is not performed. However, if the carrying value is greater than the fair value, the second step is performed. An impairment charge would be recognized for the amount that the carrying value of the goodwill exceeds its fair value. The fair values for goodwill testing are estimated using a combination of the income and market approach unless circumstances indicate that a better estimate of fair value is available. The income approach utilizes the discounted cash flow model (“DCF model”) and the market approach is based on the market data for a group of guideline companies. | |||||||||
Deferred Gain on Sale of Real Estate | Deferred Gain on Sale of Real Estate | ||||||||
On December 28, 2006, the Company entered into an agreement with a third party to sell and lease back certain of its real estate properties for $10,250. The amount of the sale price in excess of book value for these properties of $4,242 was deferred and is being amortized over the 18 year term of the leases on a straight-line basis. | |||||||||
Share-based Compensation | Share-Based Compensation | ||||||||
The Company recognizes compensation expense for share-based payment transactions in the financial statements at their fair value. The expense is measured at the grant date, based on the calculated fair value of the share-based award, and is recognized over the requisite service period (generally the vesting period of the equity award). | |||||||||
Income Taxes | Income Taxes | ||||||||
Provisions for federal and state income taxes are calculated on reported net income before income taxes based on current tax law and also include, in the current period, the cumulative effect of any changes in tax rates from those used previously in determining deferred tax assets and liabilities. Such provisions differ from the amounts currently receivable or payable because certain items of income and expense are recognized in different time periods for financial reporting purposes than for income tax purposes. Significant judgment is required in determining income tax provisions and evaluating tax positions. | |||||||||
A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. When determining the amount of net deferred tax assets that are more likely than not to be realized, Management assesses all available positive and negative evidence. This evidence includes, but is not limited to, prior earnings history, expected future earnings, carry-back and carry-forward periods and the feasibility of ongoing tax strategies that could potentially enhance the likelihood of the realization of a deferred tax asset. The weight given to the positive and negative evidence is commensurate with the extent the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses. | |||||||||
Based on these criteria and the relative weighting of both the positive and negative evidence available, and in particular the activity surrounding the Company's significant loss in 2013, management determined that it was necessary to establish a valuation allowance against all of its net U.S. deferred tax assets at December 31, 2013. This determination was made as the Company entered into a cumulative loss position over the three year period ended December 31, 2013 primarily due to recording a goodwill impairment of $73,528 related to Valent. Once the Company entered into a cumulative loss position it had passed the threshold after which there is a presumption that a company should no longer rely solely on projected future income in determining whether the deferred tax asset is more likely than not to be realized. The Company will continue to monitor its deferred tax position and may adjust the valuation allowance, if necessary, for utilization of the underlying deferred tax assets through current taxable income or as available evidence changes. At December 31, 2014, the Company's deferred tax assets remain under a valuation allowance. | |||||||||
The accounting for uncertainty in income taxes requires a more-likely-than-not threshold for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. The Company records a liability for the difference between the benefit recognized and measured for financial statement purposes and the tax position taken or expected to be taken on our tax return. To the extent that management’s assessment of such tax positions changes, the change in estimate is recorded in the period in which the determination is made. | |||||||||
The Company’s unrecognized tax benefits as of December 31, 2014 and 2013 are immaterial. The Company expects no significant increases or decreases in unrecognized tax benefits due to changes in tax positions within one year of December 31, 2014. The Company has no material interest or penalties relating to income taxes recognized on the Consolidated Balance Sheet as of December 31, 2014 and 2013. As of December 31, 2014, returns for calendar years 2011 through 2013 remain subject to examination by the Internal Revenue Service and/or various state tax jurisdictions. In December 2014, the Company was notified that the Internal Revenue Service will examine its federal returns for the 2012 and 2013 tax years. | |||||||||
Financial Instruments | Financial Instruments | ||||||||
Fair values of the Company’s long-term obligations approximate their carrying values as the applicable interest rates approximate the current market rates or have variable rate characteristics. The Company’s other financial instruments have fair values that approximate their respective carrying values due to their short maturities. | |||||||||
Reclassifications | Reclassifications | ||||||||
Certain reclassifications have been made to prior period financial statements in order to conform to current period presentation. | |||||||||
Recent Accounting Pronouncements | Recent Accounting Pronouncements | ||||||||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). The standard is effective for reporting periods beginning after December 15, 2016 and early adoption is not permitted. The standard will supersede existing revenue recognition guidance, including industry-specific guidance, and will provide companies with a single revenue recognition model for recognizing revenue from contracts with customers. The standard requires revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions. The two permitted transition methods under the new standard are the full retrospective method, in which case the standard would be applied to each prior reporting period presented, or the modified retrospective method, in which case the cumulative effect of applying the standard would be recognized at the date of initial application. The provisions of this new guidance are effective as of the beginning of the Company’s first quarter of 2017. The Company is currently evaluating the transition method to be used and the impact of adoption of this standard on its consolidated financial statements. | |||||||||
In April 2014, the FASB issued ASU 2014-08, "Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." The amendments in this update change the requirements for reporting discontinued operations. A discontinued operation may include a component of an entity or a group of components of an entity, or a business or nonprofit activity. A disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results and when the component or group of components meets the criteria to be classified as held for sale, is disposed by sale or is disposed of by other than by sale (for example, by abandonment or in a distribution to owners in a spinoff). ASU 2014-8 is effective prospectively for fiscal years, and interim reporting periods within those years, beginning after December 15, 2014. The Company has no present activity that would be impacted by this new standard. | |||||||||
In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. Under the new guidance, management will be required to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The provisions of this ASU are effective for annual periods beginning after December 15, 2016, and for annual and interim periods thereafter. |
ACCOUNTING_POLICIES_Tables
ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
Summary of catch-up adjustments | Cumulative catch-up adjustments had the following impact to operating income in the years presented: | ||||||||
2014 | 2013 | 2012 | |||||||
Favorable adjustments | 5,720 | 106 | 587 | ||||||
Unfavorable adjustments | (1,719 | ) | (1,609 | ) | (519 | ) | |||
Net operating income adjustments | 4,001 | (1,503 | ) | 68 | |||||
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Business Acquisition [Line Items] | ||||
Pro forma consolidated operating results | The following table presents unaudited pro-forma consolidated operating results for the Company for the year ended December 31, 2012, as if Valent had been acquired as of the beginning of the periods presented: | |||
2012 | ||||
Net sales | $ | 386,402 | ||
Net income | 12,899 | |||
Valent Aerostructures, LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Summary of purchase price allocation | The following table summarizes the final purchase price allocation for Valent at the date of acquisition: | |||
Cash | $ | 44 | ||
Accounts receivable | 16,769 | |||
Inventory | 28,053 | |||
Prepaid expenses and other current assets | 640 | |||
Fixed assets | 56,075 | |||
Intangible assets | 46,546 | |||
Other long-term assets | 1,576 | |||
Goodwill | 129,816 | |||
Current liabilities assumed | (25,187 | ) | ||
Long-term liabilities assumed | (23,080 | ) | ||
Cost of acquisition | $ | 231,252 | ||
TASS, Inc. [Member] | ||||
Business Acquisition [Line Items] | ||||
Summary of purchase price allocation | The following table summarizes the purchase price allocation for TASS at the date of acquisition: | |||
Cash | $ | 617 | ||
Accounts receivable | 1,979 | |||
Other assets | 175 | |||
Fixed assets | 196 | |||
Intangible assets | 2,247 | |||
Goodwill | 6,313 | |||
Current liabilities assumed | (1,247 | ) | ||
Cost of acquisition | $ | 10,280 | ||
ASSETS_AND_LIABILITIES_MEASURE1
ASSETS AND LIABILITIES MEASURED AT FAIR VALUE (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||
Valuation methodologies used for assets measured at fair value | The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. There have been no changes in the methodologies used at December 31, 2014. There were no transfers between levels during 2014 and 2013. | |||||||||||||||||||
2014 | ||||||||||||||||||||
Assets and Liabilities at Fair Value | Total | |||||||||||||||||||
as of December 31, 2014 | Gains | |||||||||||||||||||
Total | (Level 1) | (Level 2) | (Level 3) | (Losses) | ||||||||||||||||
Recurring Fair Value Measurement: | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||
Interest rate derivatives (1) | $ | — | $ | — | $ | — | $ | — | $ | (793 | ) | |||||||||
Non-recurring Fair Value Measurements: | ||||||||||||||||||||
Asset: | ||||||||||||||||||||
Intangible assets, net (2) | $ | 50,940 | $ | — | $ | — | $ | 50,940 | $ | — | ||||||||||
Goodwill (3) | $ | 86,784 | $ | — | $ | — | $ | 86,784 | $ | (26,439 | ) | |||||||||
(1) In 2014, the Company terminated and settled its interest rate derivatives in conjunction with the settlement of its then existing credit agreement. | ||||||||||||||||||||
(2) The fair values of intangibles relating to the 2012 acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. | ||||||||||||||||||||
(3) During the fourth quarter of 2014, the Company performed its annual impairment analysis of goodwill. As a result of the analysis, the goodwill related to the Engineering Services reporting unit was deemed impaired, and a $26,439 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2014. | ||||||||||||||||||||
2013 | ||||||||||||||||||||
Assets and Liabilities at Fair Value | Total | |||||||||||||||||||
as of December 31, 2013 | Gains | |||||||||||||||||||
Total | (Level 1) | (Level 2) | (Level 3) | (Losses) | ||||||||||||||||
Recurring Fair Value Measurement: | ||||||||||||||||||||
Asset: | ||||||||||||||||||||
Interest rate derivatives (1) | $ | 18 | $ | — | $ | 18 | $ | — | $ | — | ||||||||||
Liabilities: | ||||||||||||||||||||
Interest rate derivatives (1) | $ | 392 | $ | — | $ | 392 | $ | — | $ | — | ||||||||||
Non-recurring Fair Value Measurements: | ||||||||||||||||||||
Asset: | ||||||||||||||||||||
Intangible assets, net (3,4) | $ | 55,465 | $ | — | $ | — | $ | 55,465 | $ | (4,222 | ) | |||||||||
Goodwill (5) | $ | 113,223 | $ | — | $ | — | $ | 113,223 | $ | (73,528 | ) | |||||||||
Liabilities | ||||||||||||||||||||
Contingent Consideration (2) | — | $ | — | — | $ | — | $ | 7,950 | ||||||||||||
(1) The fair values of interest rate derivatives are the amount the Company would receive or pay to terminate the contracts, considering quoted market prices of comparable agreements. (Also see Note 10 to the Consolidated Financial Statements) | ||||||||||||||||||||
(2) The Monte Carlo simulation was used with a normal probability distribution of the best estimate of EBITDA for 2013 to approximate fair value. At June 30, 2013, the EBITDA target was not expected to occur and, as such, the $7,950 of contingent consideration was deemed unlikely to be paid, and a benefit was recorded on a separate line in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | ||||||||||||||||||||
(3) During the second quarter of 2013, a triggering event occurred when the Company commenced an initiative to rebrand its core engineering business. Under this initiative, the D3 Technologies name became obsolete and the $4,222 indefinite lived intangible asset related to that trade name was deemed to be fully impaired and a loss was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | ||||||||||||||||||||
(4) The fair values of intangibles relating to the 2012 acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. | ||||||||||||||||||||
(5) In 2013, the goodwill related to the Valent acquisition was deemed impaired, and a $73,528 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. |
ACCOUNTS_RECEIVABLE_NET_Tables
ACCOUNTS RECEIVABLE NET (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Receivables [Abstract] | ||||||||
Schedule of accounts receivable, net | Accounts receivable, net consists of the following: | |||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Trade receivables | $ | 53,081 | $ | 66,292 | ||||
Unbilled revenue | 4,036 | 4,671 | ||||||
Other receivables | 1,581 | 2,070 | ||||||
58,698 | 73,033 | |||||||
Less: Allowance for doubtful accounts | (464 | ) | (180 | ) | ||||
Accounts receivable, net | $ | 58,234 | $ | 72,853 | ||||
INVENTORIES_Tables
INVENTORIES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
Inventories | Inventories consist of the following: | |||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Raw materials | $ | 16,712 | $ | 17,099 | ||||
Work in progress | 22,960 | 21,605 | ||||||
Manufactured and purchased components | 21,296 | 21,675 | ||||||
Finished goods | 32,403 | 40,572 | ||||||
Product inventory | 93,371 | 100,951 | ||||||
Capitalized contract costs (1) | 20,908 | 12,227 | ||||||
Total inventories | $ | 114,279 | $ | 113,178 | ||||
(1) 2013 includes a reduction to inventory of $2,057 related to a loss reserve on a long-term production contract. |
PROPERTY_PLANT_AND_EQUIPMENT_T
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Schedule of property, plant and equipment | Depreciation expense (including amortization expense on software) recorded by the Company totaled $17,934, $15,913 and $5,894 for 2014, 2013 and 2012, respectively. | |||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Land | $ | 1,108 | $ | 1,455 | ||||
Buildings and improvements | 25,415 | 23,692 | ||||||
Machinery and equipment | 122,509 | 122,132 | ||||||
Leasehold improvements | 13,034 | 14,421 | ||||||
Software and other | 12,059 | 11,403 | ||||||
Construction in progress | 10,696 | 5,031 | ||||||
Total gross property, plant and equipment | 184,821 | 178,134 | ||||||
Less accumulated depreciation | (85,339 | ) | (74,759 | ) | ||||
Total net property, plant and equipment | $ | 99,482 | $ | 103,375 | ||||
GOODWILL_AND_INTANGIBLE_ASSETS1
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||
Schedule of goodwill | The following table summarizes the net carrying amount of goodwill by segment at December 31, 2014 and 2013, respectively: | |||||||||||||||||||||||
Engineering | ||||||||||||||||||||||||
Aerostructures | Services | Total | ||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||
Balance at December 31, | ||||||||||||||||||||||||
Gross Goodwill | $ | 141,953 | $ | 141,953 | $ | 50,741 | $ | 50,741 | $ | 192,694 | $ | 192,694 | ||||||||||||
Accumulated impairment loss | (79,471 | ) | (79,471 | ) | (26,439 | ) | — | (105,910 | ) | (79,471 | ) | |||||||||||||
Net Goodwill | $ | 62,482 | $ | 62,482 | $ | 24,302 | $ | 50,741 | $ | 86,784 | $ | 113,223 | ||||||||||||
Finite and infinite lived intangible assets | The remaining trademarks resulted from the acquisitions of Intec, TASS, and Valent and have a weighted average useful life of 4.5 years. Customer intangibles have a weighted average useful life of 18.5 years. Other intangible assets have a weighted average useful life of 5.3 years. The carrying values were as follows: | |||||||||||||||||||||||
December 31, | ||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||
Trademarks | $ | 778 | $ | 778 | ||||||||||||||||||||
Customer intangible assets | 68,991 | 68,991 | ||||||||||||||||||||||
Other | 1,274 | 1,274 | ||||||||||||||||||||||
Accumulated amortization | (20,103 | ) | (15,578 | ) | ||||||||||||||||||||
Intangible assets, net | $ | 50,940 | $ | 55,465 | ||||||||||||||||||||
Estimated annual amortization expense | The estimated annual amortization expense for intangibles assets is as follows: | |||||||||||||||||||||||
Year ending December 31, | ||||||||||||||||||||||||
2015 | $ | 4,359 | ||||||||||||||||||||||
2016 | 4,134 | |||||||||||||||||||||||
2017 | 3,915 | |||||||||||||||||||||||
2018 | 3,563 | |||||||||||||||||||||||
2019 | 3,263 | |||||||||||||||||||||||
Thereafter | 31,706 | |||||||||||||||||||||||
$ | 50,940 | |||||||||||||||||||||||
ACCRUED_EXPENSES_Tables
ACCRUED EXPENSES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Payables and Accruals [Abstract] | ||||||||
Schedule of accrued expenses | Accrued expenses consist of the following: | |||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Accrued interest | $ | 9,814 | $ | 125 | ||||
Accrued payroll | 1,647 | 3,286 | ||||||
Accrued bonus | 3,014 | 958 | ||||||
Accrued vacation & holiday | 2,933 | 3,516 | ||||||
Accrued employee benefits | 1,800 | 1,847 | ||||||
Accrued operating lease obligations | 2,186 | 2,002 | ||||||
Accrued professional fees | 980 | 1,253 | ||||||
Accrued restructuring | 739 | 422 | ||||||
Loss reserve on long-term production contracts | — | 3,165 | ||||||
Other | 2,959 | 1,992 | ||||||
Total accrued expenses | $ | 26,072 | $ | 18,566 | ||||
LONGTERM_DEBT_AND_CAPITAL_LEAS1
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS Long-term Debt and Capital Lease Obligations (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Long-term debt | Long-term debt and capital lease obligations consist of the following: | |||||||
December 31, | ||||||||
2014 | 2013 | |||||||
Second priority senior secured notes at a fixed rate of 7.375% at December 31, 2014 | $ | 245,000 | $ | — | ||||
Term loan under credit agreement, variable | — | 222,750 | ||||||
Revolver under credit agreement, variable | — | 36,000 | ||||||
Missouri IRBs at fixed rate of 2.80% at December 31, 2014 and December 31, 2013 | 7,334 | 7,756 | ||||||
Capital Leases, at fixed rates ranging from 2.04% to 7.73% at December 31, 2014 and 2.04% to 7.73% at December 31, 2013 | 13,288 | 14,572 | ||||||
Notes payable, principal and interest payable monthly, at fixed rates, up to 2.56% and 3.60% at December 31, 2014 and 2013, respectively (1) | 3,356 | 9,533 | ||||||
Total debt | 268,978 | 290,611 | ||||||
Less current installments | 3,424 | 5,242 | ||||||
Total long-term debt and capital lease obligations | $ | 265,554 | $ | 285,369 | ||||
(1) During the year ended December 31, 2014, the Company settled a mortgage and an equipment loan in cash in the amount of $2,109 and $3,140, respectively. | ||||||||
Five year maturities of long-term debt | The long-term debt and capital lease payment obligations including the current portion thereof required in each of the next five years and thereafter are as follows: | |||||||
Year ending December 31, | Long-Term | Capital Leases | ||||||
Debt (1) | ||||||||
2015 | $ | 1,983 | $ | 1,946 | ||||
2016 | 951 | 1,916 | ||||||
2017 | 919 | 1,962 | ||||||
2018 | 944 | 2,223 | ||||||
2019 | 245,849 | 2,500 | ||||||
Thereafter | 4,919 | 5,175 | ||||||
Total | 255,565 | 15,722 | ||||||
Less: imputed interest | — | (2,309 | ) | |||||
Total | $ | 255,565 | $ | 13,413 | ||||
(1) Includes principal only |
DERIVATIVE_FINANCIAL_INSTRUMEN1
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||
Derivatives recognized in the Condensed Consolidated Balance Sheet | At December 31, 2013, the derivatives were recognized in the Condensed Consolidated Balance sheet as current assets and liabilities at fair value as follows: | ||||||||||
Derivative Assets and Liabilities | Location in Condensed | 31-Dec-13 | |||||||||
Consolidated Balance Sheet | |||||||||||
Derivative designated as hedging instrument: | |||||||||||
Interest rate purchased options at fair value | Other current assets | $ | 18 | ||||||||
Derivative designated as hedging instrument: | |||||||||||
Interest rate swaps at fair value | Other long term liabilities | $ | 392 | ||||||||
Derivatives recognized in AOCI and earnings | The following amounts are included in AOCI and earnings for the year ended December 31, 2014: | ||||||||||
Net of Tax | |||||||||||
Derivatives in Cash Flow Hedging Relationship | Effective portion | Effective | |||||||||
of (Gain) Loss Recognized in AOCI on | Portion of | ||||||||||
Derivative | (Gain) Loss Reclassified | ||||||||||
from AOCI | |||||||||||
into | |||||||||||
Earnings | |||||||||||
Year ended December 31, 2014 | |||||||||||
Interest rate derivatives | $ | — | $ | 278 | |||||||
LOSS_EARNINGS_PER_COMMON_SHARE1
(LOSS) EARNINGS PER COMMON SHARE (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Earnings Per Share [Abstract] | ||||||||||||
Calculation of basic and diluted earnings per share | The following table shows a reconciliation of the numerators and denominators used in calculating basic and diluted earnings per share. | |||||||||||
Year ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Numerators | ||||||||||||
Net (loss) income | $ | (28,962 | ) | $ | (58,485 | ) | $ | 16,487 | ||||
Denominators | ||||||||||||
Weighted average common shares - basic | 12,716,976 | 12,607,833 | 11,701,607 | |||||||||
Dilutive effect of restricted stock | — | — | 137,575 | |||||||||
Weighted average common shares - diluted | 12,716,976 | 12,607,833 | 11,839,182 | |||||||||
Basic earnings per share | $ | (2.28 | ) | $ | (4.64 | ) | $ | 1.41 | ||||
Diluted earnings per share | $ | (2.28 | ) | $ | (4.64 | ) | $ | 1.39 | ||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Commitments and Contingencies Disclosure [Abstract] | ||||
Schedule of future minimum lease payments under operating leases | At December 31, 2014, the future minimum lease payments under operating leases with initial non-cancelable terms in excess of one year are as follows: | |||
2015 | $ | 8,023 | ||
2016 | 7,197 | |||
2017 | 6,234 | |||
2018 | 5,664 | |||
2019 | 4,552 | |||
Thereafter | 18,066 | |||
$ | 49,736 | |||
STOCK_BASED_COMPENSATION_Table
STOCK BASED COMPENSATION (Tables) | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||
Summary of the activity for non-vested restricted stock awards | A summary of the activity for non-vested restricted stock awards under the Company’s share-based compensation plans is presented below: | ||||||
2014 | |||||||
Restricted Stock Awards | Shares | Weighted Average | |||||
Grant Date Fair | |||||||
Value | |||||||
Outstanding at January 1 | 219,751 | $ | 19.74 | ||||
Granted | 189,902 | 13.97 | |||||
Vested | (78,779 | ) | 18.5 | ||||
Forfeited | (34,092 | ) | 17.95 | ||||
Outstanding at December 31 | 296,782 | $ | 16.58 | ||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||
Schedule of deferred tax assets and liabilities | Net deferred tax (liabilities)/assets at December 31, were as follows: | |||||||||||
December 31, | ||||||||||||
2014 | 2013 | |||||||||||
Deferred tax assets | $ | 31,580 | $ | 32,282 | ||||||||
Deferred tax liabilities | (19,198 | ) | (14,363 | ) | ||||||||
Valuation allowance | (12,676 | ) | (18,137 | ) | ||||||||
Net deferred tax liabilities | $ | (294 | ) | $ | (218 | ) | ||||||
Components of the net deferred tax liability or asset recognized [Table Text Block] | The temporary differences between the tax basis of assets and liabilities and their financial reporting amounts that give rise to the deferred income tax assets and liabilities are as follows: | |||||||||||
December 31, | ||||||||||||
2014 | 2013 | |||||||||||
Goodwill and intangible assets | $ | 16,375 | $ | 19,491 | ||||||||
Inventories | 3,483 | 3,871 | ||||||||||
NOL carry forwards | 2,345 | 651 | ||||||||||
Tax credit carry forwards | 1,180 | 367 | ||||||||||
Stock award | 1,049 | 891 | ||||||||||
Gain on sale of real estate | 868 | 954 | ||||||||||
Obligation under operating leases | 800 | 733 | ||||||||||
Accrued vacation | 773 | 912 | ||||||||||
Accrued bonus | 722 | 351 | ||||||||||
Other | 547 | 351 | ||||||||||
Long-term contract costs | (7,652 | ) | (4,475 | ) | ||||||||
Depreciation | (8,108 | ) | (6,178 | ) | ||||||||
Valuation allowance | (12,676 | ) | (18,137 | ) | ||||||||
Net deferred tax liabilities | $ | (294 | ) | $ | (218 | ) | ||||||
Schedule of income tax provision attributable to income before income taxes | The Company’s income tax (benefit) provision attributable to income before taxes consisted of the following for the years ended December 31, 2014, 2013 and 2012 | |||||||||||
2014 | 2013 | 2012 | ||||||||||
Federal: | ||||||||||||
Current | $ | (9,173 | ) | $ | (676 | ) | $ | 7,926 | ||||
Deferred | 155 | (6,066 | ) | (109 | ) | |||||||
(9,018 | ) | (6,742 | ) | 7,817 | ||||||||
State: | ||||||||||||
Current | 21 | 120 | 346 | |||||||||
Deferred | 44 | (357 | ) | (10 | ) | |||||||
65 | (237 | ) | 336 | |||||||||
(Benefit) provision for income taxes | $ | (8,953 | ) | $ | (6,979 | ) | $ | 8,153 | ||||
Schedule of effective income tax rate reconciliation | The reconciliation of income tax computed at the U.S. federal statutory tax rates to income tax (benefit) provision is as follows: | |||||||||||
2014 | 2013 | 2012 | ||||||||||
Federal taxes | $ | (13,270 | ) | $ | (22,912 | ) | $ | 8,627 | ||||
State and local taxes, net of federal benefit | 358 | (1,119 | ) | 336 | ||||||||
Production deduction | — | — | (530 | ) | ||||||||
Non-deductible goodwill impairment | 9,254 | — | — | |||||||||
Valuation allowance | (5,294 | ) | 17,718 | — | ||||||||
Research and experimental and other tax credits | (503 | ) | (634 | ) | (300 | ) | ||||||
Other | 502 | (32 | ) | 20 | ||||||||
(Benefit) provision for income taxes | $ | (8,953 | ) | $ | (6,979 | ) | $ | 8,153 | ||||
RESTRUCTURING_Tables
RESTRUCTURING (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Restructuring and Related Activities [Abstract] | ||||||||||||
Summary of incurred and expected restructuring charges | The following table summarizes the incurred and expected charges associated with these restructuring activities: | |||||||||||
Expense | Remaining | Total Expense | ||||||||||
Incurred through | Expense to be | Expected to be | ||||||||||
31-Dec-14 | Incurred | Incurred | ||||||||||
(In Thousands) | ||||||||||||
Employee severance arrangement - Precise closure | $ | 615 | $ | — | $ | 615 | ||||||
Employee severance arrangement - Savannah | 47 | — | 47 | |||||||||
Employee severance arrangement - St. Charles closure | 228 | 76 | 304 | |||||||||
Other employee severance arrangements | 1,908 | — | 1,908 | |||||||||
Lease termination costs - Precise closure | 124 | — | 124 | |||||||||
Other restructuring expenses | 115 | — | 115 | |||||||||
Total | $ | 3,037 | $ | 76 | $ | 3,113 | ||||||
Summary of restructuring activity | The following table summarizes restructuring activity related to the Precise Machine facility closure, Savannah machining relocation, St. Charles facility closure and other employee separation activities: | |||||||||||
Employee | ||||||||||||
Severance | Other | Total | ||||||||||
(In Thousands) | ||||||||||||
Accrued restructuring balance as of December 31, 2013 | $ | 422 | $ | — | $ | 422 | ||||||
Accrual additions | 2,461 | 124 | 2,585 | |||||||||
Cash payments | (2,144 | ) | (124 | ) | (2,268 | ) | ||||||
Accrued restructuring balance as of December 31, 2014 | $ | 739 | $ | — | $ | 739 | ||||||
BUSINESS_SEGMENT_INFORMATION_T
BUSINESS SEGMENT INFORMATION (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Segment Reporting [Abstract] | ||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance | The table below presents information about reported segments on the basis used internally to evaluate segment performance: | |||||||||||
December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Net sales: | ||||||||||||
Aerostructures | $ | 326,025 | $ | 331,654 | $ | 174,983 | ||||||
Engineering Services | 63,404 | 83,717 | 105,607 | |||||||||
Eliminations | (1,612 | ) | (2,814 | ) | (1,961 | ) | ||||||
$ | 387,817 | $ | 412,557 | $ | 278,629 | |||||||
Gross profit: | ||||||||||||
Aerostructures | $ | 67,042 | $ | 68,088 | $ | 47,947 | ||||||
Engineering Services | 8,428 | 12,145 | 20,270 | |||||||||
Eliminations | (100 | ) | (371 | ) | 91 | |||||||
$ | 75,370 | $ | 79,862 | $ | 68,308 | |||||||
(Loss) income from operations: | ||||||||||||
Aerostructures (1) (4) | $ | 18,977 | $ | (46,050 | ) | $ | 15,484 | |||||
Engineering Services (2) (3) | (27,731 | ) | (2,699 | ) | 10,480 | |||||||
Eliminations | (104 | ) | (371 | ) | 91 | |||||||
$ | (8,858 | ) | $ | (49,120 | ) | $ | 26,055 | |||||
Depreciation, amortization and certain other non-cash charges: | ||||||||||||
Aerostructures (1) | $ | 20,223 | $ | 91,557 | $ | 5,532 | ||||||
Engineering Services (2) (3) | 28,675 | 6,754 | 2,462 | |||||||||
Corporate (4) | $ | — | $ | (7,950 | ) | $ | — | |||||
$ | 48,898 | $ | 90,361 | $ | 7,994 | |||||||
(1)Includes a $73,528 for goodwill impairment in 2013. | ||||||||||||
(2)Includes a $26,439 for goodwill impairment in 2014. | ||||||||||||
(3)Includes a $4,222 charge for impairment of intangible 2013. | ||||||||||||
(4)Includes the write-off of contingent consideration of $7,950 in 2013. | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Interest expense: | ||||||||||||
Aerostructures | $ | 1,041 | $ | 1,054 | $ | 23 | ||||||
Engineering Services | 41 | 53 | 25 | |||||||||
Corporate (1) | 28,198 | 15,855 | 1,723 | |||||||||
$ | 29,280 | $ | 16,962 | $ | 1,771 | |||||||
(1) Includes $8,466 and $580 related to the write-off of deferred financing costs in 2014 and 2012, respectively. | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Capital expenditures: | ||||||||||||
Aerostructures (1) | $ | 16,504 | $ | 23,600 | $ | 18,649 | ||||||
Engineering Services | 186 | 549 | 880 | |||||||||
$ | 16,690 | $ | 24,149 | $ | 19,529 | |||||||
(1) Includes $411 and $746 associated with capital leases in 2013 and 2012, respectively. | ||||||||||||
December 31, | ||||||||||||
2014 | 2013 | |||||||||||
Total assets: | ||||||||||||
Aerostructures | $ | 399,689 | $ | 405,779 | ||||||||
Engineering | 42,747 | 74,272 | ||||||||||
$ | 442,436 | $ | 480,051 | |||||||||
QUARTERLY_FINANCIAL_DATA_UNAUD1
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
Schedule of quarterly financial data | The results of any single quarter are not necessarily indicative of the Company’s results for the full year. Earnings per share data is computed independently for each of the periods presented. As a result, the sum of the earnings per share amounts for the quarter may not equal the total for the year. | |||||||||||||||
2014 | First (1) | Second (2) | Third (3) | Fourth (4) | ||||||||||||
Net sales | $ | 95,751 | $ | 105,937 | $ | 97,335 | $ | 88,794 | ||||||||
Gross profit (3) | $ | 17,461 | $ | 19,134 | $ | 22,043 | $ | 16,732 | ||||||||
Net (loss) income (1,2,3,4) | $ | (442 | ) | $ | (7,411 | ) | $ | 1,396 | $ | (22,505 | ) | |||||
Amounts per common share: | ||||||||||||||||
Net (loss) income | $ | (0.03 | ) | $ | (0.58 | ) | $ | 0.11 | $ | (1.76 | ) | |||||
Net (loss) income - assuming dilution | $ | (0.03 | ) | $ | (0.58 | ) | $ | 0.11 | $ | (1.76 | ) | |||||
2013 | First (5) | Second (6) | Third | Fourth (7) | ||||||||||||
Net sales | $ | 106,066 | $ | 105,465 | $ | 104,656 | $ | 96,370 | ||||||||
Gross profit (5,7) | $ | 20,054 | $ | 21,841 | $ | 20,418 | $ | 17,549 | ||||||||
Net income (loss) (5),(6),(7) | $ | 1,837 | $ | 4,664 | $ | 2,075 | $ | (67,061 | ) | |||||||
Amounts per common share: | ||||||||||||||||
Net income | $ | 0.15 | $ | 0.37 | $ | 0.16 | $ | (5.31 | ) | |||||||
Net income - assuming dilution | $ | 0.14 | $ | 0.37 | $ | 0.16 | $ | (5.31 | ) | |||||||
(1) Included in the net loss for the the first quarter of 2014 were $428 of restructuring expenses. | ||||||||||||||||
-2 | Net loss in the second quarter of 2014 includes $793 of interest expense related to the termination of interest rate derivatives and $8,340 related to the write-off of debt issuance costs associated with the modification of the Company's revolving credit facility and the termination of its long-term credit agreement. Net loss in the second quarter of 2014 also includes $1,095 of restructuring expenses. | |||||||||||||||
-3 | Gross profit in the third quarter of 2014 includes a $5,286 favorable cumulative catch-up adjustment related to the settlement of an unpriced change order and the Company's ability to secure more favorable future material pricing on a long-term production contract. In addition, net income in the third quarter of 2014 includes $765 of restructuring expenses. | |||||||||||||||
-4 | Net loss in the fourth quarter of 2014 includes a $26,439 goodwill impairment charge related to the Engineering Services reporting unit, $228 of restructuring expenses and a $6,396 income tax benefit resulting from the decision to carry the 2014 tax loss back to previous years. | |||||||||||||||
(5) The first quarter of 2013 included $2,497 of non-recurring inventory step-up related to the Valent acquisition. | ||||||||||||||||
-6 | The second quarter of 2013 included a trade name impairment of $4,222 related to D3 Technologies offset by a contingent consideration write-off of $7,950 related to Valent. | |||||||||||||||
-7 | The fourth quarter of 2013 included a goodwill impairment charge of $73,528 related to the Valent acquisition, $17,718 related to income tax valuation allowance, $2,620 related to a separation agreement reached with key members of Valent Aerostructures, LLC. and $453 of restructuring expenses related to the closure of the Precise Machine facility. In addition, Valent gross profit was unfavorably impacted by $955 in cumulative catch-up adjustments, the result of higher levels of indirect costs required to meet customer demand. |
CONDENSED_CONSOLIDATING_FINANC1
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ||||||||||||||||
Condensed Consolidating Balance Sheet | CONDENSED CONSOLIDATING BALANCE SHEET | |||||||||||||||
31-Dec-14 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Assets | ||||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 7,058 | $ | 869 | $ | — | $ | 7,927 | ||||||||
Trade accounts receivable, net | 1,310 | 56,924 | — | 58,234 | ||||||||||||
Intercompany receivables | 145,980 | 145,223 | (291,203 | ) | — | |||||||||||
Inventories | — | 114,279 | — | 114,279 | ||||||||||||
Prepaid expenses and other current assets | 8,325 | 1,930 | — | 10,255 | ||||||||||||
Deferred income taxes | — | 4,031 | (118 | ) | 3,913 | |||||||||||
Total current assets | 162,673 | 323,256 | (291,321 | ) | 194,608 | |||||||||||
Property, plant and equipment, net | 3,148 | 96,334 | — | 99,482 | ||||||||||||
Investments in subsidiaries | 368,587 | (368,587 | ) | — | ||||||||||||
Goodwill | — | 86,784 | — | 86,784 | ||||||||||||
Intangible assets, net | — | 50,940 | — | 50,940 | ||||||||||||
Deferred income taxes | 118 | — | (118 | ) | — | |||||||||||
Other assets | 8,743 | 1,879 | — | 10,622 | ||||||||||||
Total assets | $ | 543,269 | $ | 559,193 | $ | (660,026 | ) | $ | 442,436 | |||||||
Liabilities and shareholders’ equity | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Accounts payable | $ | 1,339 | $ | 20,416 | $ | — | $ | 21,755 | ||||||||
Accrued expenses | 13,679 | 12,393 | — | 26,072 | ||||||||||||
Intercompany Payables | 164,158 | 127,045 | (291,203 | ) | $ | — | ||||||||||
Deferred income taxes | 118 | — | (118 | ) | — | |||||||||||
Current installments of long-term debt and capital lease obligations | 335 | 3,089 | — | 3,424 | ||||||||||||
Total current liabilities | 179,629 | 162,943 | (291,321 | ) | 51,251 | |||||||||||
Long-term debt and capital lease obligations, less current installments | 245,174 | 20,380 | — | 265,554 | ||||||||||||
Other long-term liabilities | 331 | 2,958 | — | 3,289 | ||||||||||||
Deferred income taxes | — | 4,325 | (118 | ) | 4,207 | |||||||||||
Total long-term liabilities | 245,505 | 27,663 | (118 | ) | 273,050 | |||||||||||
Total shareholders’ equity | 118,135 | 368,587 | (368,587 | ) | 118,135 | |||||||||||
Total liabilities and shareholders’ equity | $ | 543,269 | $ | 559,193 | $ | (660,026 | ) | $ | 442,436 | |||||||
CONDENSED CONSOLIDATING BALANCE SHEET | ||||||||||||||||
31-Dec-13 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Assets | ||||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 405 | $ | 1,167 | $ | — | $ | 1,572 | ||||||||
Trade accounts receivable, net | 14,783 | 58,070 | — | 72,853 | ||||||||||||
Intercompany receivables | 152,143 | 142,111 | (294,254 | ) | $ | — | ||||||||||
Inventories | — | 113,178 | — | 113,178 | ||||||||||||
Prepaid expenses and other current assets | 2,385 | 2,026 | — | 4,411 | ||||||||||||
Deferred income taxes | — | 2,800 | (107 | ) | 2,693 | |||||||||||
Total current assets | 169,716 | 319,352 | (294,361 | ) | 194,707 | |||||||||||
Property, plant and equipment, net | 7,022 | 96,353 | — | 103,375 | ||||||||||||
Investments in subsidiaries | 378,707 | — | (378,707 | ) | — | |||||||||||
Goodwill | — | 113,223 | — | 113,223 | ||||||||||||
Intangible assets, net | — | 55,465 | — | 55,465 | ||||||||||||
Deferred income taxes | 135 | — | (135 | ) | — | |||||||||||
Other assets | 11,152 | 2,129 | — | 13,281 | ||||||||||||
Total assets | $ | 566,732 | $ | 586,522 | $ | (673,203 | ) | $ | 480,051 | |||||||
Liabilities and shareholders’ equity | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Accounts payable | $ | 3,415 | $ | 16,489 | $ | — | $ | 19,904 | ||||||||
Accrued expenses | 2,560 | 16,006 | — | 18,566 | ||||||||||||
Intercompany Payables | 152,743 | 141,511 | (294,254 | ) | $ | — | ||||||||||
Deferred income taxes | 135 | — | (135 | ) | — | |||||||||||
Current installments of long-term debt and capital lease obligations | 2,827 | 2,415 | — | 5,242 | ||||||||||||
Total current liabilities | 161,680 | 176,421 | (294,389 | ) | 43,712 | |||||||||||
Long-term debt and capital lease obligations, less current installments | 260,148 | 25,221 | — | 285,369 | ||||||||||||
Other long-term liabilities | 760 | 3,155 | — | 3,915 | ||||||||||||
Deferred income taxes | — | 3,018 | (107 | ) | 2,911 | |||||||||||
Total long-term liabilities | 260,908 | 31,394 | (107 | ) | 292,195 | |||||||||||
Total shareholders’ equity | 144,144 | 378,707 | (378,707 | ) | 144,144 | |||||||||||
Total liabilities and shareholders’ equity | $ | 566,732 | $ | 586,522 | $ | (673,203 | ) | $ | 480,051 | |||||||
Condensed Consolidating Income Statement | CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | |||||||||||||||
31-Dec-14 | ||||||||||||||||
(Amounts in thousands, except share and per share data) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Sales and service revenue | ||||||||||||||||
Product sales | $ | 466 | $ | 321,286 | $ | (468 | ) | $ | 321,284 | |||||||
Service revenues | 36,181 | 66,543 | (36,191 | ) | 66,533 | |||||||||||
Net sales | 36,647 | 387,829 | (36,659 | ) | 387,817 | |||||||||||
Cost of sales and service revenue | ||||||||||||||||
Cost of product sales | 699 | 254,544 | (468 | ) | 254,775 | |||||||||||
Cost of service revenues | 35,998 | 57,864 | (36,190 | ) | 57,672 | |||||||||||
Cost of sales | 36,697 | 312,408 | (36,658 | ) | 312,447 | |||||||||||
Gross profit | (50 | ) | 75,421 | (1 | ) | 75,370 | ||||||||||
Selling, general and administrative expenses | 792 | 54,412 | — | 55,204 | ||||||||||||
Goodwill and intangible asset impairment | — | 26,439 | — | 26,439 | ||||||||||||
Contingent consideration write-off | — | — | — | — | ||||||||||||
Restructuring expense | 1,011 | 1,574 | — | 2,585 | ||||||||||||
Acquisitions expense | — | — | — | — | ||||||||||||
(Loss) income from operations | (1,853 | ) | (7,004 | ) | (1 | ) | (8,858 | ) | ||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (28,224 | ) | (1,056 | ) | — | (29,280 | ) | |||||||||
Other, net | 11 | 212 | — | 223 | ||||||||||||
Income (loss) from equity investments in subsidiaries | (8,860 | ) | — | 8,860 | — | |||||||||||
Total other expense | (37,073 | ) | (844 | ) | 8,860 | (29,057 | ) | |||||||||
(Loss) income before income taxes | (38,926 | ) | (7,848 | ) | 8,859 | (37,915 | ) | |||||||||
(Benefit) provision for income taxes | (9,867 | ) | 914 | — | (8,953 | ) | ||||||||||
Net (loss) income | (29,059 | ) | (8,762 | ) | 8,859 | (28,962 | ) | |||||||||
Other comprehensive income (loss): | ||||||||||||||||
Change in foreign currency translation adjustment | — | (98 | ) | — | (98 | ) | ||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | 278 | — | — | 278 | ||||||||||||
Unrealized loss on interest rate hedges | — | — | — | — | ||||||||||||
Total comprehensive (loss) income | $ | (28,781 | ) | $ | (8,860 | ) | $ | 8,859 | $ | (28,782 | ) | |||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||
31-Dec-13 | ||||||||||||||||
(Amounts in thousands, except share and per share data) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Sales and service revenue | ||||||||||||||||
Product sales | $ | 4,388 | $ | 324,455 | $ | (4,710 | ) | $ | 324,133 | |||||||
Service revenues | 41,578 | 88,141 | (41,295 | ) | 88,424 | |||||||||||
Net sales | 45,966 | 412,596 | (46,005 | ) | 412,557 | |||||||||||
Cost of sales and service revenue | ||||||||||||||||
Cost of product sales | 4,290 | 255,681 | (4,710 | ) | 255,261 | |||||||||||
Cost of service revenues | 41,533 | 77,124 | (41,223 | ) | 77,434 | |||||||||||
Cost of sales | 45,823 | 332,805 | (45,933 | ) | 332,695 | |||||||||||
Gross profit | 143 | 79,791 | (72 | ) | 79,862 | |||||||||||
Selling, general and administrative expenses | — | 55,862 | — | 55,862 | ||||||||||||
Goodwill and intangible asset impairment | — | 77,750 | — | 77,750 | ||||||||||||
Contingent consideration write-off | (7,950 | ) | — | — | (7,950 | ) | ||||||||||
Restructuring expense | 4 | 3,069 | — | 3,073 | ||||||||||||
Acquisitions expense | 229 | 18 | — | 247 | ||||||||||||
(Loss) income from operations | 7,860 | (56,908 | ) | (72 | ) | (49,120 | ) | |||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (15,887 | ) | (1,075 | ) | — | (16,962 | ) | |||||||||
Other, net | 95 | 523 | — | 618 | ||||||||||||
Income (loss) from equity investments in subsidiaries | (52,206 | ) | — | 52,206 | — | |||||||||||
Total other expense | (67,998 | ) | (552 | ) | 52,206 | (16,344 | ) | |||||||||
(Loss) income before income taxes | (60,138 | ) | (57,460 | ) | 52,134 | (65,464 | ) | |||||||||
(Benefit) provision for income taxes | (1,702 | ) | (5,277 | ) | — | (6,979 | ) | |||||||||
Net (loss) income | (58,436 | ) | (52,183 | ) | 52,134 | (58,485 | ) | |||||||||
Other comprehensive income (loss): | ||||||||||||||||
Change in foreign currency translation adjustment | — | (23 | ) | — | (23 | ) | ||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | — | — | — | — | ||||||||||||
Unrealized loss on interest rate hedges | (278 | ) | — | — | (278 | ) | ||||||||||
Total comprehensive (loss) income | $ | (58,714 | ) | $ | (52,206 | ) | $ | 52,134 | $ | (58,786 | ) | |||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||
31-Dec-12 | ||||||||||||||||
(Amounts in thousands, except share and per share data) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Sales and service revenue | ||||||||||||||||
Product sales | $ | 825 | $ | 169,000 | $ | (882 | ) | $ | 168,943 | |||||||
Service revenues | 36,713 | 109,616 | (36,643 | ) | 109,686 | |||||||||||
Net sales | 37,538 | 278,616 | (37,525 | ) | 278,629 | |||||||||||
Cost of sales and service revenue | ||||||||||||||||
Cost of product sales | 772 | 121,357 | (882 | ) | 121,247 | |||||||||||
Cost of service revenues | 36,706 | 88,964 | (36,596 | ) | 89,074 | |||||||||||
Cost of sales | 37,478 | 210,321 | (37,478 | ) | 210,321 | |||||||||||
Gross profit | 60 | 68,295 | (47 | ) | 68,308 | |||||||||||
Selling, general and administrative expenses | — | 36,891 | — | 36,891 | ||||||||||||
Goodwill and intangible asset impairment | — | — | — | — | ||||||||||||
Contingent consideration write-off | — | — | — | — | ||||||||||||
Restructuring expense | — | — | — | — | ||||||||||||
Acquisitions expense | 5,337 | 25 | — | 5,362 | ||||||||||||
(Loss) income from operations | (5,277 | ) | 31,379 | (47 | ) | 26,055 | ||||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (1,727 | ) | (44 | ) | — | (1,771 | ) | |||||||||
Other, net | 7 | 349 | — | 356 | ||||||||||||
Income (loss) from equity investments in subsidiaries | 20,977 | — | (20,977 | ) | — | |||||||||||
Total other expense | 19,257 | 305 | (20,977 | ) | (1,415 | ) | ||||||||||
(Loss) income before income taxes | 13,980 | 31,684 | (21,024 | ) | 24,640 | |||||||||||
(Benefit) provision for income taxes | (2,507 | ) | 10,660 | — | 8,153 | |||||||||||
Net (loss) income | 16,487 | 21,024 | (21,024 | ) | 16,487 | |||||||||||
Other comprehensive income (loss): | ||||||||||||||||
Change in foreign currency translation adjustment | — | (49 | ) | — | (49 | ) | ||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | — | — | — | — | ||||||||||||
Unrealized loss on interest rate hedges | — | — | — | — | ||||||||||||
Total comprehensive (loss) income | $ | 16,487 | $ | 20,975 | $ | (21,024 | ) | $ | 16,438 | |||||||
Condensed Consolidating Cash Flow Statement | CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | |||||||||||||||
For the Year ended December 31, 2014 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Operating activities: | ||||||||||||||||
Net (loss)/income | $ | (29,059 | ) | $ | (8,762 | ) | $ | 8,859 | $ | (28,962 | ) | |||||
Adjustments for non-cash items | 21,713 | 46,497 | (8,859 | ) | 59,351 | |||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | 19,977 | (1,249 | ) | — | 18,728 | |||||||||||
Intercompany activity | 17,663 | (17,663 | ) | — | — | |||||||||||
Net cash (used)/provided by operating activities | 30,294 | 18,823 | — | 49,117 | ||||||||||||
Investing activities: | ||||||||||||||||
Additions to property, plant and equipment | (715 | ) | (15,975 | ) | — | (16,690 | ) | |||||||||
Acquisitions, net of cash acquired | — | — | — | — | ||||||||||||
Proceeds from sale of equipment | 2,558 | 1,021 | — | 3,579 | ||||||||||||
Net cash used by investing activities | 1,843 | (14,954 | ) | — | (13,111 | ) | ||||||||||
Financing activities: | ||||||||||||||||
Proceeds from issuance of debt | 250,000 | — | — | 250,000 | ||||||||||||
Principal payments on long-term debt and notes payable | (231,466 | ) | (4,167 | ) | — | (235,633 | ) | |||||||||
Advances on revolving line of credit | 66,000 | — | — | 66,000 | ||||||||||||
Payments on revolving line of credit | (102,000 | ) | — | — | (102,000 | ) | ||||||||||
Payments for debt issuance cost | (8,018 | ) | — | — | (8,018 | ) | ||||||||||
Other, net | — | — | — | — | ||||||||||||
Net cash provided (used) by financing activities | (25,484 | ) | (4,167 | ) | — | (29,651 | ) | |||||||||
Net (decrease) increase in cash and cash equivalents | 6,653 | (298 | ) | — | 6,355 | |||||||||||
Cash and cash equivalents, beginning of year | 405 | 1,167 | — | 1,572 | ||||||||||||
Cash and cash equivalents, end of year | $ | 7,058 | $ | 869 | $ | — | $ | 7,927 | ||||||||
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | ||||||||||||||||
For the Year ended December 31, 2013 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Operating activities: | ||||||||||||||||
Net (loss)/income | $ | (58,436 | ) | $ | (52,183 | ) | $ | 52,134 | $ | (58,485 | ) | |||||
Adjustments for non-cash items | 46,716 | 90,913 | (52,134 | ) | 85,495 | |||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | 696 | (36,055 | ) | — | (35,359 | ) | ||||||||||
Intercompany activity | (12,974 | ) | 12,974 | — | — | |||||||||||
Net cash (used)/provided by operating activities | (23,998 | ) | 15,649 | — | (8,349 | ) | ||||||||||
Investing activities: | ||||||||||||||||
Additions to property, plant and equipment | (4,623 | ) | (19,115 | ) | — | (23,738 | ) | |||||||||
Acquisitions, net of cash acquired | (504 | ) | — | — | (504 | ) | ||||||||||
Proceeds from sale of equipment | — | 1,989 | — | 1,989 | ||||||||||||
Net cash used by investing activities | (5,127 | ) | (17,126 | ) | — | (22,253 | ) | |||||||||
Financing activities: | ||||||||||||||||
Proceeds from issuance of debt | 3,551 | 2,200 | — | 5,751 | ||||||||||||
Principal payments on long-term debt and notes payable | (5,767 | ) | (96 | ) | — | (5,863 | ) | |||||||||
Advances on revolving line of credit | 107,000 | — | — | 107,000 | ||||||||||||
Payments on revolving line of credit | (77,236 | ) | — | — | (77,236 | ) | ||||||||||
Payments for debt issuance cost | (1,780 | ) | (37 | ) | — | (1,817 | ) | |||||||||
Other, net | (8 | ) | — | — | (8 | ) | ||||||||||
Net cash provided (used) by financing activities | 25,760 | 2,067 | — | 27,827 | ||||||||||||
Net (decrease) increase in cash and cash equivalents | (3,365 | ) | 590 | — | (2,775 | ) | ||||||||||
Cash and cash equivalents, beginning of year | 3,770 | 577 | — | 4,347 | ||||||||||||
Cash and cash equivalents, end of year | $ | 405 | $ | 1,167 | $ | — | $ | 1,572 | ||||||||
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | ||||||||||||||||
For the Year ended December 31, 2012 | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
LMIA(Guarantor Parent) | Guarantor Subsidiaries | Consolidating/Eliminating Entries | Consolidated | |||||||||||||
Operating activities: | ||||||||||||||||
Net (loss)/income | $ | 16,487 | $ | 21,024 | $ | (21,024 | ) | $ | 16,487 | |||||||
Adjustments for non-cash items | (28,544 | ) | 15,411 | 21,242 | 8,109 | |||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | 2,195 | (17,993 | ) | 1 | (15,797 | ) | ||||||||||
Intercompany activity | 912 | (693 | ) | (219 | ) | — | ||||||||||
Net cash (used)/provided by operating activities | (8,950 | ) | 17,749 | — | 8,799 | |||||||||||
Investing activities: | ||||||||||||||||
Additions to property, plant and equipment | (406 | ) | (18,377 | ) | — | (18,783 | ) | |||||||||
Acquisitions, net of cash acquired | (216,398 | ) | — | — | (216,398 | ) | ||||||||||
Proceeds from sale of equipment | 11 | 170 | — | 181 | ||||||||||||
Net cash used by investing activities | (216,793 | ) | (18,207 | ) | — | (235,000 | ) | |||||||||
Financing activities: | ||||||||||||||||
Proceeds from issuance of debt | 228,123 | 1,001 | — | 229,124 | ||||||||||||
Principal payments on long-term debt and notes payable | (118 | ) | — | — | (118 | ) | ||||||||||
Advances on revolving line of credit | 40,278 | — | — | 40,278 | ||||||||||||
Payments on revolving line of credit | (34,042 | ) | — | — | (34,042 | ) | ||||||||||
Payments for debt issuance cost | (12,736 | ) | — | — | (12,736 | ) | ||||||||||
Other, net | 174 | — | — | 174 | ||||||||||||
Net cash provided (used) by financing activities | 221,679 | 1,001 | — | 222,680 | ||||||||||||
Net (decrease) increase in cash and cash equivalents | (4,064 | ) | 543 | — | (3,521 | ) | ||||||||||
Cash and cash equivalents, beginning of year | 7,834 | 34 | — | 7,868 | ||||||||||||
Cash and cash equivalents, end of year | $ | 3,770 | $ | 577 | $ | — | $ | 4,347 | ||||||||
ACCOUNTING_POLICIES_Details
ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2006 | Dec. 28, 2006 |
Accounting Policies [Abstract] | |||
Revenue recognition, percentage of revenue subject to guidance in ASC 605-15 and 605-20, minimum | 80.00% | ||
Revenue recognition, percentage of revenue subject to guidance in ASC 605-15 and 605-20, maximum | 90.00% | ||
Percentage of revenue associated with claims and unpriced change orders | 0.10% | ||
Sell and lease back of real estate properties | $10,250 | ||
Amount of the sale price in excess of book value | $4,242 | ||
Lease term of property | 18 years |
ACCOUNTING_POLICIES_CHANGE_IN_
ACCOUNTING POLICIES, CHANGE IN ACCOUNTING ESTIMATE (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 |
contract | |||||
Change in Accounting Estimate [Line Items] | |||||
Increase (Decrease) in Loss and Loss Adjustment Expense Reserve | $5,267 | ||||
Favorable adjustments | 5,286 | ||||
Contracts Accounted for under Percentage of Completion [Member] | |||||
Change in Accounting Estimate [Line Items] | |||||
Favorable adjustments | 5,720 | 106 | 587 | ||
Unfavorable adjustments | -1,719 | -1,609 | -519 | ||
Net operating income adjustments | 4,001 | -1,503 | 68 | ||
Number of contracts with negative cumulative catch-up adjustments | 2 | 2 | |||
B-787 Dreamliner [Member] | Contracts Accounted for under Percentage of Completion [Member] | |||||
Change in Accounting Estimate [Line Items] | |||||
Unfavorable adjustments | -5,267 | -811 | |||
Mitsubishi Regional Jet [Member] [Member] | Contracts Accounted for under Percentage of Completion [Member] | |||||
Change in Accounting Estimate [Line Items] | |||||
Unfavorable adjustments | -1,479 | ||||
EMB-KC390 [Member] | Contracts Accounted for under Percentage of Completion [Member] | |||||
Change in Accounting Estimate [Line Items] | |||||
Unfavorable adjustments | -706 | ||||
Valent Aerostructures, LLC [Member] | |||||
Change in Accounting Estimate [Line Items] | |||||
Adjustment to loss provision on long-term production contract | 5,267 | ||||
Unfavorable adjustments | ($955) |
ACCOUNTING_POLICIES_ACQUISITIO
ACCOUNTING POLICIES, ACQUISITIONS (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | ||
Business Acquisition [Line Items] | ||||||
Impairment loss on goodwill | $26,439 | $26,439 | [1] | $73,528 | [2] | |
Valent Aerostructures, LLC [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Impairment loss on goodwill | $73,528 | $73,528 | ||||
[1] | During the fourth quarter of 2014, the Company performed its annual impairment analysis of goodwill. As a result of the analysis, the goodwill related to the Engineering Services reporting unit was deemed impaired, and a $26,439 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2014. | |||||
[2] | In 2013, the goodwill related to the Valent acquisition was deemed impaired, and a $73,528 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. |
ACCOUNTING_POLICIES_ACCOUNTING
ACCOUNTING POLICIES ACCOUNTING POLICIES, PROPERTY, PLANT AND EQUIPMENT (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Building [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 35 years |
Building [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 20 years |
Machinery and Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 10 years |
Machinery and Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 4 years |
Computer Software, Intangible Asset [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 4 years |
Computer Software, Intangible Asset [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
ACQUISITIONS_Details
ACQUISITIONS (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 28, 2012 | Aug. 07, 2012 |
Business Acquisition [Line Items] | |||||
Equity interests issued | $15,000 | ||||
Acquisition related costs | 0 | 247 | 5,362 | ||
Summary of purchase price allocation [Abstract] | |||||
Goodwill | 86,784 | 113,223 | |||
Valent Aerostructures, LLC [Member] | |||||
Business Acquisition [Line Items] | |||||
Acquisition date | 28-Dec-12 | ||||
Equity interests issued | 15,000 | ||||
Acquisition related costs | 5,107 | ||||
Acquired intangible assets | 46,546 | ||||
Business Acquisition, Pro Forma Information [Abstract] | |||||
Net sales | 386,402 | ||||
Net income | 12,899 | ||||
Summary of purchase price allocation [Abstract] | |||||
Cash | 44 | ||||
Accounts receivable | 16,769 | ||||
Inventory | 28,053 | ||||
Prepaid expenses and other current assets | 640 | ||||
Fixed assets | 56,075 | ||||
Intangible assets | 46,546 | ||||
Other long-term assets | 1,576 | ||||
Goodwill | 129,816 | ||||
Current liabilities assumed | -25,187 | ||||
Long-term liabilities assumed | -23,080 | ||||
Cost of acquisition | 231,252 | ||||
Valent Aerostructures, LLC [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Acquired intangible assets | 45,600 | ||||
Weighted average estimated useful life | 20 years 3 months 18 days | ||||
Valent Aerostructures, LLC [Member] | Trademarks and Other Intangibles [Member] | |||||
Business Acquisition [Line Items] | |||||
Acquired intangible assets | 946 | ||||
Weighted average estimated useful life | 5 years 6 months | ||||
TASS, Inc. [Member] | |||||
Business Acquisition [Line Items] | |||||
Acquisition date | 7-Aug-12 | ||||
Acquired intangible assets | 2,247 | ||||
Notes payable | 1,000 | ||||
Summary of purchase price allocation [Abstract] | |||||
Cash | 617 | ||||
Accounts receivable | 1,979 | ||||
Other assets | 175 | ||||
Fixed assets | 196 | ||||
Intangible assets | 2,247 | ||||
Goodwill | 6,313 | ||||
Current liabilities assumed | -1,247 | ||||
Cost of acquisition | 10,280 | ||||
TASS, Inc. [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Acquired intangible assets | 1,876 | ||||
Weighted average estimated useful life | 11 years 10 months 24 days | ||||
TASS, Inc. [Member] | Trademarks and Other Intangibles [Member] | |||||
Business Acquisition [Line Items] | |||||
Acquired intangible assets | $371 | ||||
Weighted average estimated useful life | 2 years 10 months 24 days | ||||
Restricted Stock [Member] | Valent Aerostructures, LLC [Member] | |||||
Business Acquisition [Line Items] | |||||
Percentage of stock eligible for conversion in June 2014 | 50.00% |
ASSETS_AND_LIABILITIES_MEASURE2
ASSETS AND LIABILITIES MEASURED AT FAIR VALUE (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||
Liabilities at Fair Value [Abstract] | ||||||||||
Derivative, Loss on Derivative | ($793) | [1] | ($793) | [1] | ||||||
Impairment loss on intangible assets | 0 | [2] | -4,222 | [3] | ||||||
Impairment loss on goodwill | 26,439 | 26,439 | [4] | 73,528 | [5] | |||||
Contingent consideration write-off | 7,950 | 0 | 7,950 | [6] | 0 | |||||
Non-recurring Fair Value Measurement [Member] | ||||||||||
Assets at Fair Value [Abstract] | ||||||||||
Intangible assets, net | 50,940 | [2] | 50,940 | [2] | 55,465 | [2],[3] | ||||
Goodwill | 86,784 | [4] | 86,784 | [4] | 113,223 | [5] | ||||
Liabilities at Fair Value [Abstract] | ||||||||||
Contingent consideration | 0 | [6] | ||||||||
Non-recurring Fair Value Measurement [Member] | Level 1 [Member] | ||||||||||
Assets at Fair Value [Abstract] | ||||||||||
Intangible assets, net | 0 | [2] | 0 | [2] | 0 | [2],[3] | ||||
Goodwill | 0 | [4] | 0 | [4] | 0 | [5] | ||||
Liabilities at Fair Value [Abstract] | ||||||||||
Contingent consideration | 0 | [6] | ||||||||
Non-recurring Fair Value Measurement [Member] | Level 2 [Member] | ||||||||||
Assets at Fair Value [Abstract] | ||||||||||
Intangible assets, net | 0 | [2] | 0 | [2] | 0 | [2],[3] | ||||
Goodwill | 0 | [4] | 0 | [4] | 0 | [5] | ||||
Liabilities at Fair Value [Abstract] | ||||||||||
Contingent consideration | 0 | [6] | ||||||||
Non-recurring Fair Value Measurement [Member] | Level 3 [Member] | ||||||||||
Assets at Fair Value [Abstract] | ||||||||||
Intangible assets, net | 50,940 | [2] | 50,940 | [2] | 55,465 | [2],[3] | ||||
Goodwill | 86,784 | [4] | 86,784 | [4] | 113,223 | [5] | ||||
Liabilities at Fair Value [Abstract] | ||||||||||
Contingent consideration | 0 | [6] | ||||||||
Interest Rate Derivatives [Member] | Recurring Fair Value Measurement [Member] | ||||||||||
Assets at Fair Value [Abstract] | ||||||||||
Interest rate derivatives | 18 | [7] | ||||||||
Liabilities at Fair Value [Abstract] | ||||||||||
Interest rate derivatives | 0 | 0 | 392 | [7] | ||||||
Interest Rate Derivatives [Member] | Recurring Fair Value Measurement [Member] | Level 1 [Member] | ||||||||||
Assets at Fair Value [Abstract] | ||||||||||
Interest rate derivatives | 0 | [7] | ||||||||
Liabilities at Fair Value [Abstract] | ||||||||||
Interest rate derivatives | 0 | 0 | 0 | [7] | ||||||
Interest Rate Derivatives [Member] | Recurring Fair Value Measurement [Member] | Level 2 [Member] | ||||||||||
Assets at Fair Value [Abstract] | ||||||||||
Interest rate derivatives | 18 | [7] | ||||||||
Liabilities at Fair Value [Abstract] | ||||||||||
Interest rate derivatives | 0 | 0 | 392 | [7] | ||||||
Interest Rate Derivatives [Member] | Recurring Fair Value Measurement [Member] | Level 3 [Member] | ||||||||||
Assets at Fair Value [Abstract] | ||||||||||
Interest rate derivatives | 0 | [7] | ||||||||
Liabilities at Fair Value [Abstract] | ||||||||||
Interest rate derivatives | $0 | $0 | $0 | [7] | ||||||
[1] | In 2014, the Company terminated and settled its interest rate derivatives in conjunction with the settlement of its then existing credit agreement. | |||||||||
[2] | The fair values of intangibles relating to the 2012 acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. | |||||||||
[3] | During the second quarter of 2013, a triggering event occurred when the Company commenced an initiative to rebrand its core engineering business. Under this initiative, the D3 Technologies name became obsolete and the $4,222 indefinite lived intangible asset related to that trade name was deemed to be fully impaired and a loss was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | |||||||||
[4] | During the fourth quarter of 2014, the Company performed its annual impairment analysis of goodwill. As a result of the analysis, the goodwill related to the Engineering Services reporting unit was deemed impaired, and a $26,439 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2014. | |||||||||
[5] | In 2013, the goodwill related to the Valent acquisition was deemed impaired, and a $73,528 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | |||||||||
[6] | The Monte Carlo simulation was used with a normal probability distribution of the best estimate of EBITDA for 2013 to approximate fair value. At June 30, 2013, the EBITDA target was not expected to occur and, as such, the $7,950 of contingent consideration was deemed unlikely to be paid, and a benefit was recorded on a separate line in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | |||||||||
[7] | The fair values of interest rate derivatives are the amount the Company would receive or pay to terminate the contracts, considering quoted market prices of comparable agreements. (Also see Note 10 to the Consolidated Financial Statements) |
ACCOUNTS_RECEIVABLE_NET_Detail
ACCOUNTS RECEIVABLE NET (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Accounts Receivable, Net [Abstract] | ||
Trade receivables | $53,081 | $66,292 |
Unbilled revenue | 4,036 | 4,671 |
Other receivables | 1,581 | 2,070 |
Accounts receivable, gross | 58,698 | 73,033 |
Less: Allowance for doubtful accounts | -464 | -180 |
Accounts receivable, net | $58,234 | $72,853 |
INVENTORIES_Details
INVENTORIES (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | ||
Inventories [Abstract] | ||||
Raw materials | $16,712,000 | $17,099,000 | ||
Work in progress | 22,960,000 | 21,605,000 | ||
Manufactured and purchased components | 21,296,000 | 21,675,000 | ||
Finished goods | 32,403,000 | 40,572,000 | ||
Product inventory | 93,371,000 | 100,951,000 | ||
Capitalized contract costs | 20,908,000 | [1] | 12,227,000 | [1] |
Total inventories | 114,279,000 | 113,178,000 | ||
Loss on Long-term Production Contracts [Member] | ||||
Inventories [Abstract] | ||||
Loss reserve | ($2,057) | |||
[1] | 2013 includes a reduction to inventory of $2,057 related to a loss reserve on a long-term production contract. |
PROPERTY_PLANT_AND_EQUIPMENT_D
PROPERTY, PLANT AND EQUIPMENT (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization | $17,934 | $15,913 | $5,894 |
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 184,821 | 178,134 | |
Less accumulated depreciation | -85,339 | -74,759 | |
Total net property, plant and equipment | 99,482 | 103,375 | |
Land [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 1,108 | 1,455 | |
Buildings and Improvements [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 25,415 | 23,692 | |
Machinery and Equipment [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 122,509 | 122,132 | |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 13,034 | 14,421 | |
Software and Other [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 12,059 | 11,403 | |
Construction in Progress [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | $10,696 | $5,031 |
GOODWILL_AND_INTANGIBLE_ASSETS2
GOODWILL AND INTANGIBLE ASSETS, GOODWILL (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Aug. 07, 2012 | Dec. 28, 2012 | ||
Goodwill [Line Items] | ||||||||
Gross Goodwill | $192,694 | $192,694 | $192,694 | $192,694 | ||||
Accumulated impairment loss | -105,910 | -105,910 | -79,471 | -79,471 | ||||
Net Goodwill | 86,784 | 86,784 | 113,223 | 113,223 | ||||
Impairment loss on goodwill | 26,439 | 26,439 | [1] | 73,528 | [2] | |||
Aerostructures [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Gross Goodwill | 141,953 | 141,953 | 141,953 | 141,953 | ||||
Accumulated impairment loss | -79,471 | -79,471 | -79,471 | -79,471 | ||||
Net Goodwill | 62,482 | 62,482 | 62,482 | 62,482 | ||||
Engineering Services [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Gross Goodwill | 50,741 | 50,741 | 50,741 | 50,741 | ||||
Accumulated impairment loss | -26,439 | -26,439 | 0 | 0 | ||||
Net Goodwill | 24,302 | 24,302 | 50,741 | 50,741 | ||||
Integrated Technologies, Inc. [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Net Goodwill | 6,194 | 6,194 | ||||||
TASS, Inc. [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Net Goodwill | 6,313 | |||||||
Valent Aerostructures, LLC [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Net Goodwill | 129,816 | |||||||
Adjustment to loss provision on long-term production contract | 5,267 | |||||||
Adjustment to fixed assets during measurement period | 482 | |||||||
Adjustment to working capital | 1,219 | |||||||
Impairment loss on goodwill | 73,528 | 73,528 | ||||||
Valent Aerostructures, LLC [Member] | Aerostructures [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Net Goodwill | 56,288 | 56,288 | ||||||
Engineering Services [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Net Goodwill | 24,302 | 24,302 | 50,741 | 50,741 | ||||
Impairment loss on goodwill | $26,439 | |||||||
[1] | During the fourth quarter of 2014, the Company performed its annual impairment analysis of goodwill. As a result of the analysis, the goodwill related to the Engineering Services reporting unit was deemed impaired, and a $26,439 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2014. | |||||||
[2] | In 2013, the goodwill related to the Valent acquisition was deemed impaired, and a $73,528 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. |
GOODWILL_AND_INTANGIBLE_ASSETS3
GOODWILL AND INTANGIBLE ASSETS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Intangible Assets [Abstract] | |||
Trademarks | $778 | $778 | |
Customer intangible assets | 68,991 | 68,991 | |
Other | 1,274 | 1,274 | |
Accumulated amortization | -20,103 | -15,578 | |
Intangible assets, net | 50,940 | 55,465 | |
Amortization expense on intangible assets | 4,524 | 4,647 | 3,185 |
Estimated annual amortization expense for these intangibles [Abstract] | |||
2014 | 4,359 | ||
2015 | 4,134 | ||
2016 | 3,915 | ||
2017 | 3,563 | ||
2018 | 3,263 | ||
Thereafter | 31,706 | ||
Intangible assets, net | 50,940 | 55,465 | |
Customer Intangible Assets [Member] | |||
Intangible Assets [Abstract] | |||
Weighted average estimated useful life | 18 years 6 months | ||
Other [Member] | |||
Intangible Assets [Abstract] | |||
Weighted average estimated useful life | 5 years 3 months 18 days | ||
D3 Technologies, Inc. [Member] | Trademarks [Member] | |||
Intangible Assets [Abstract] | |||
Indefinite-lived trademarks | $4,222 | ||
Intec, TASS and Valent [Member] | Trademarks [Member] | |||
Intangible Assets [Abstract] | |||
Weighted average estimated useful life | 4 years 6 months |
ACCRUED_EXPENSES_Details
ACCRUED EXPENSES (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 |
Payables and Accruals [Abstract] | |||
Debt Instrument, Increase, Accrued Interest | $9,689 | ||
Interest Payable | 9,814 | 125 | |
Accrued Liabilities [Abstract] | |||
Accrued payroll | 1,647 | 3,286 | |
Accrued bonus | 3,014 | 958 | |
Accrued vacation & holiday | 2,933 | 3,516 | |
Accrued employee benefits | 1,800 | 1,847 | |
Accrued operating lease obligations | 2,186 | 2,002 | |
Accrued professional fees | 980 | 1,253 | |
Restructuring Reserve | 739 | 422 | |
Loss reserve on long-term production contracts | 0 | 3,165 | |
Other | 2,959 | 1,992 | |
Total accrued expenses | $26,072 | $18,566 |
ACCRUED_EXPENSES_ACQUISITIONRE
ACCRUED EXPENSES, ACQUISITION-RELATED (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2014 |
Business Acquisition [Line Items] | ||
Loss reserve on long-term production contracts | $3,165 | $0 |
Valent Aerostructures, LLC [Member] | ||
Business Acquisition [Line Items] | ||
Adjustment to loss provision on long-term production contract | 5,267 | |
Loss reserve on long-term production contracts | 5,222 | |
Accrued Liabilities, Current [Member] | Valent Aerostructures, LLC [Member] | ||
Business Acquisition [Line Items] | ||
Loss reserve on long-term production contracts | $3,165 |
LONGTERM_DEBT_AND_CAPITAL_LEAS2
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS (Details) (USD $) | 3 Months Ended | 12 Months Ended | 0 Months Ended | ||||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 07, 2012 | Mar. 28, 2013 | Sep. 30, 2014 | Jun. 19, 2014 | |
Debt Instrument [Line Items] | |||||||||
Long-term debt, total | $268,978 | $290,611 | |||||||
Current installments of long-term debt and capital lease obligations | 3,424 | 5,242 | |||||||
Long-term debt and capital lease obligations, less current installments | 265,554 | 285,369 | |||||||
Capital Lease Obligations | 312 | ||||||||
Lease Expiration Date | 31-Dec-25 | ||||||||
Write off of Deferred Debt Issuance Cost | 8,340 | 8,466 | 0 | 0 | |||||
Gross amount of assets recorded under capital leases | 15,567 | ||||||||
Debt Issuance Cost | 8,122 | ||||||||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||||||||
Year ending December 31, 2015 | 1,983 | [1] | |||||||
Year ending December 31, 2016 | 951 | [1] | |||||||
Year ending December 31, 2017 | 919 | [1] | |||||||
Year ending December 31, 2018 | 944 | [1] | |||||||
Year ending December 31, 2019 | 245,849 | [1] | |||||||
Thereafter | 4,919 | [1] | |||||||
Long-term debt, total | 255,565 | [1] | |||||||
Less: imputed interest | 0 | [1] | |||||||
Long-term debt, five year maturities | 255,565 | [1] | |||||||
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||||||||
Year ending December 31, 2015 | 1,946 | ||||||||
Year ending December 31, 2016 | 1,916 | ||||||||
Year ending December 31, 2017 | 1,962 | ||||||||
Year ending December 31, 2018 | 2,223 | ||||||||
Year ending December 31, 2019 | 2,500 | ||||||||
Thereafter | 5,175 | ||||||||
Capital leases, total | 15,722 | ||||||||
Less: imputed interest | -2,309 | ||||||||
Total capital leases, five year maturities | 13,413 | ||||||||
Mortgages [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Repayments of Bank Debt | 2,109 | ||||||||
Commercial Loan [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Repayments of Bank Debt | 3,140 | ||||||||
Promissory Note to Finance Purchase of Corporate Aircraft [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | 3,550 | ||||||||
Fixed interest rate (in hundredths) | 3.60% | ||||||||
Second Priority Senior Secured Notes [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt, gross | 245,000 | 0 | |||||||
Long-term debt, total | 250,000 | ||||||||
Debt Instrument, Repurchase Amount | 5,000 | ||||||||
Premium Paid on Debt Repurchase | 1.13% | ||||||||
Fixed interest rate (in hundredths) | 7.38% | ||||||||
Term Loan Under Credit Agreement, Variable [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt, gross | 0 | 222,750 | |||||||
Revolver Under Credit Agreement, Variable [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt, gross | 0 | 36,000 | |||||||
Municipal Bonds [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt, gross | 7,334 | 7,756 | |||||||
Fixed interest rate, minimum (in hundredths) | 2.80% | ||||||||
Maturity dates | 30-Sep-20 | ||||||||
Fixed interest rate (in hundredths) | 2.80% | ||||||||
Capital Leases [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt, gross | 13,288 | 14,572 | |||||||
Fixed interest rate, minimum (in hundredths) | 2.04% | 2.04% | |||||||
Fixed interest rate, maximum (in hundredths) | 7.73% | 7.73% | |||||||
Maturity dates | 30-Jun-32 | ||||||||
Fixed interest rate (in hundredths) | 4.57% | ||||||||
Lease Expiration Date | 31-Mar-22 | ||||||||
Notes Payable to Prior Minority Shareholder [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | 2,000 | ||||||||
Period over which monthly installments due | 36 months | ||||||||
Notes Payable [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt, gross | 3,356 | 9,533 | 1,000 | ||||||
Fixed interest rate, minimum (in hundredths) | 2.45% | ||||||||
Fixed interest rate, maximum (in hundredths) | 2.56% | 3.60% | |||||||
Maturity dates | 31-Aug-13 | ||||||||
Fixed interest rate (in hundredths) | 3.25% | ||||||||
Promissory Note to Finance Building [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $2,200 | ||||||||
Fixed interest rate (in hundredths) | 2.95% | ||||||||
[1] | Includes principal only |
LONGTERM_DEBT_AND_CAPITAL_LEAS3
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, LINE OF CREDIT FACILITY (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Jun. 19, 2014 | |
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Remaining Borrowing Capacity | $75,000,000 | |
Letters of Credit Outstanding, Amount | 1,210,000 | |
Maximum borrowing capacity | 90,000,000 | |
Reserve Against line of Credit | 15,000,000 | |
Line of Credit Facility, Interest Rate During Period | 4.50% | |
Commitment fee (in hundredths) | 0.50% | |
Line of Credit Facility, Current Borrowing Capacity | $56,545,000 | |
Line of Credit Facility, Borrowing Capacity, Description | The maximum amount, less reserves, available for borrowing at levels below $30,000 are based on a sum of 45% of eligible receivables, 30% of eligible inventories and an additional amount of eligible equipment up to 20% of total borrowings under the facility. The maximum amount, less reserves, available for borrowing at levels above $30,000 are based on a sum of 75% of eligible receivables, 45% of eligible inventories and an additional amount of eligible equipment up to 20% of total borrowings under the facility. | |
Minimum [Member] | ||
Line of Credit Facility [Line Items] | ||
Commitment fee (in hundredths) | 0.38% | |
Maximum [Member] | ||
Line of Credit Facility [Line Items] | ||
Commitment fee (in hundredths) | 0.50% | |
London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | ||
Line of Credit Facility [Line Items] | ||
Spread over reference rate (in hundredths) | 3.00% | |
London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | ||
Line of Credit Facility [Line Items] | ||
Spread over reference rate (in hundredths) | 3.50% | |
Base Rate [Member] | Minimum [Member] | ||
Line of Credit Facility [Line Items] | ||
Spread over reference rate (in hundredths) | 2.00% | |
Base Rate [Member] | Maximum [Member] | ||
Line of Credit Facility [Line Items] | ||
Spread over reference rate (in hundredths) | 2.50% | |
Eurodollar [Member] | ||
Line of Credit Facility [Line Items] | ||
Spread over reference rate (in hundredths) | 1.00% | |
Federal funds rate [Member] | ||
Line of Credit Facility [Line Items] | ||
Spread over reference rate (in hundredths) | 0.50% |
DERIVATIVE_FINANCIAL_INSTRUMEN2
DERIVATIVE FINANCIAL INSTRUMENTS (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2014 | ||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||
Derivative, Loss on Derivative | $793 | [1] | $793 | [1] |
[1] | In 2014, the Company terminated and settled its interest rate derivatives in conjunction with the settlement of its then existing credit agreement. |
DERIVATIVE_FINANCIAL_INSTRUMEN3
DERIVATIVE FINANCIAL INSTRUMENT, FAIR VALUE BY BALANCE SHEET LOCATION (Details) (Designated as Hedging Instrument [Member], USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Interest Rate Purchase Option [Member] | Other Current Assets [Member] | |
Derivatives, Fair Value [Line Items] | |
Interest rate purchased options at fair value | $18 |
Interest Rate Swap [Member] | Other Long Term Liabilities [Member] | |
Derivatives, Fair Value [Line Items] | |
Interest rate swaps at fair value | $392 |
DERIVATIVE_FINANCIAL_INSTRUMEN4
DERIVATIVE FINANCIAL INSTRUMENTS, FAIR VALUE BY INCOME STATEMENT LOCATION (Details) (Interest Rate Swap [Member], Cash Flow Hedging [Member], USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Interest Rate Swap [Member] | Cash Flow Hedging [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Effective portion of (Gain) Loss Recognized in AOCI on Derivative | $0 |
Effective Portion of (Gain) Loss Reclassified from AOCI into Earnings | $278 |
TREASURY_STOCK_TRANSACTIONS_De
TREASURY STOCK TRANSACTIONS (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Equity [Abstract] | |||
Treasury Stock, Shares, Acquired | 6,075 | ||
Stock Issued During Period, Shares, Share-based Compensation, Forfeited | 32,890 | ||
Shares Paid for Tax Withholding for Share Based Compensation | 2,651 | ||
Stock Issued During Period, Shares, Share-based Compensation, Gross | 17,291 | ||
Stock Issued During Period, Shares, Issued for Services | 12,175 | ||
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | 38,397 | 102,986 | |
Shares reissued from treasury for 401(k) plan (in shares) | 40,904 | 44,474 |
LOSS_EARNINGS_PER_COMMON_SHARE2
(LOSS) EARNINGS PER COMMON SHARE (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||||||
Numerators [Abstract] | ||||||||||||||||||
Net (loss)/income | ($22,505) | [1] | $1,396 | [2] | ($7,411) | [3] | ($442) | [4] | ($67,061) | [5] | $2,075 | $4,664 | [6] | $1,837 | [7] | ($28,962) | ($58,485) | $16,487 |
Denominators [Abstract] | ||||||||||||||||||
Weighted average common shares - basic (in shares) | 12,716,976 | 12,607,833 | 11,701,607 | |||||||||||||||
Dilutive effect of restricted stock (in shares) | 0 | 0 | 137,575 | |||||||||||||||
Weighted average common shares - diluted (in shares) | 12,716,976 | 12,607,833 | 11,839,182 | |||||||||||||||
Basic earnings per share (in dollars per share) | ($1.76) | [1] | $0.11 | [2] | ($0.58) | [3] | ($0.03) | [4] | ($5.31) | [5] | $0.16 | $0.37 | [6] | $0.15 | [7] | ($2.28) | ($4.64) | $1.41 |
Diluted earnings per share (in dollars per share) | ($1.76) | [1] | $0.11 | [2] | ($0.58) | [3] | ($0.03) | [4] | ($5.31) | [5] | $0.16 | $0.37 | [6] | $0.14 | [7] | ($2.28) | ($4.64) | $1.39 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 153,249 | 111,976 | ||||||||||||||||
[1] | Net loss in the fourth quarter of 2014 includes a $26,439 goodwill impairment charge related to the Engineering Services reporting unit, $228 of restructuring expenses and a $6,396 income tax benefit resulting from the decision to carry the 2014 tax loss back to previous years. | |||||||||||||||||
[2] | Gross profit in the third quarter of 2014 includes a $5,286 favorable cumulative catch-up adjustment related to the settlement of an unpriced change order and the Company's ability to secure more favorable future material pricing on a long-term production contract. In addition, net income in the third quarter of 2014 includes $765 of restructuring expenses. | |||||||||||||||||
[3] | Net loss in the second quarter of 2014 includes $793 of interest expense related to the termination of interest rate derivatives and $8,340 related to the write-off of debt issuance costs associated with the modification of the Company's revolving credit facility and the termination of its long-term credit agreement. Net loss in the second quarter of 2014 also includes $1,095 of restructuring expenses. | |||||||||||||||||
[4] | Included in the net loss for the the first quarter of 2014 were $428 of restructuring expenses. | |||||||||||||||||
[5] | The fourth quarter of 2013 included a goodwill impairment charge of $73,528 related to the Valent acquisition, $17,718 related to income tax valuation allowance, $2,620 related to a separation agreement reached with key members of Valent Aerostructures, LLC. and $453 of restructuring expenses related to the closure of the Precise Machine facility. In addition, Valent gross profit was unfavorably impacted by $955 in cumulative catch-up adjustments, the result of higher levels of indirect costs required to meet customer demand. | |||||||||||||||||
[6] | The second quarter of 2013 included a trade name impairment of $4,222 related to D3 Technologies offset by a contingent consideration write-off of $7,950 related to Valent. | |||||||||||||||||
[7] | The first quarter of 2013 included $2,497 of non-recurring inventory step-up related to the Valent acquisition. |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Commitments and Contingencies Disclosure [Abstract] | |||
Lease Expiration Date | 31-Dec-25 | ||
Future minimum lease payments under operating leases [Abstract] | |||
2014 | $8,023 | ||
2015 | 7,197 | ||
2016 | 6,234 | ||
2017 | 5,664 | ||
2018 | 4,552 | ||
Thereafter | 18,066 | ||
Total | 49,736 | ||
Operating lease rent expense | $8,396 | $8,501 | $6,789 |
Maximum term of employment agreement | 3 years | ||
Tech Investments LLC and Tech Investments II LLC [Member] | |||
Future minimum lease payments under operating leases [Abstract] | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 5.50% | ||
Common Stock, Other Shares, Outstanding | 360,301 |
COMMITMENTS_AND_CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES, LOSS CONTINGENCIES (Details) (USD $) | Dec. 31, 2014 |
In Thousands, except Share data, unless otherwise specified | |
Unfavorable Regulatory Action [Member] | |
Loss Contingencies [Line Items] | |
Loss contingency accrual | $175 |
Environmental Protection Agency [Member] | |
Loss Contingencies [Line Items] | |
Loss contingency accrual | $694 |
Tech Investments LLC and Tech Investments II LLC [Member] | |
Loss Contingencies [Line Items] | |
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 5.50% |
Common Stock, Other Shares, Outstanding | 360,301 |
DEFINED_CONTRIBUTIONS_PLANS_De
DEFINED CONTRIBUTIONS PLANS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Number of company sponsored defined contribution plans | 3 | ||
LMI Profit Sharing and Savings Plan [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Maximum annual contribution per employee amount | $1,000 | ||
Defined contribution plan vesting period | 6 years | ||
Recognized cost for matching contributions | 729,000 | 830,000 | 882,000 |
Employer matching contribution percentage (in hundredths) | 50.00% | 50.00% | 50.00% |
Valent Plans [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Recognized cost for matching contributions | $848,000 | $745,000 | |
Employer matching contribution percentage (in hundredths) | 3.00% | ||
Employer matching contribution threshold | 3.00% | ||
TASS Plan [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Defined contribution plan vesting period | 5 years |
STOCK_BASED_COMPENSATION_Detai
STOCK BASED COMPENSATION (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Weighted Average Grant Date Fair Value | |||
Compensation expense | $1,850 | $1,615 | $1,494 |
Restricted Stock Awards [Member] | |||
Shares | |||
Outstanding beginning balance (in shares) | 219,751 | ||
Granted (in shares) | 189,902 | ||
Vested (in shares) | -78,779 | ||
Forfeited (in shares) | -34,092 | ||
Outstanding ending balance (in shares) | 296,782 | 219,751 | |
Weighted Average Grant Date Fair Value | |||
Outstanding beginning balance (in dollars per share) | $19.74 | ||
Granted (in dollars per share) | $13.97 | ||
Vested (in dollars per share) | $18.50 | ||
Forfeited (in dollars per share) | $17.95 | ||
Outstanding ending balance (in dollars per share) | $16.58 | $19.74 | |
Unrecognized compensation costs | 2,036 | 1,857 | |
Costs are expected to be recognized over a weighted average period | 1 year 2 months 12 days | 1 year 2 months 12 days | |
Fair value of restricted stock awards that vested | $1,083 | $602 | $3,199 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | ||||
Deferred Tax Assets, Gross | $31,580 | $31,580 | $32,282 | |
Deferred Tax Liabilities, Gross | -19,198 | -19,198 | -14,363 | |
Deferred Tax Assets, Valuation Allowance | -12,676 | -12,676 | -18,137 | |
Deferred Tax Liabilities, Net | -294 | -294 | -218 | |
Increase in valuation allowance to fully reserve the U.S. net deferred tax asset | -5,461 | |||
Components of Deferred Tax Assets and Liabilities [Abstract] | ||||
Goodwill and intangible assets | 16,375 | 16,375 | 19,491 | |
Inventories | 3,483 | 3,483 | 3,871 | |
NOL carry forwards | 2,345 | 2,345 | 651 | |
Tax credit carry forwards | 1,180 | 1,180 | 367 | |
Stock award | 1,049 | 1,049 | 891 | |
Gain on sale of real estate | 868 | 868 | 954 | |
Obligation under operating leases | 800 | 800 | 733 | |
Accrued vacation | 773 | 773 | 912 | |
Accrued bonus | 722 | 722 | 351 | |
Other | 547 | 547 | 351 | |
Long-term contract costs | -7,652 | -7,652 | -4,475 | |
Depreciation | -8,108 | -8,108 | -6,178 | |
Valuation allowance | -12,676 | -12,676 | -18,137 | |
Income Tax Expense (Benefit), Continuing Operations, by Jurisdiction [Abstract] | ||||
Increase (Decrease) in Income Taxes Receivable | 6,349 | |||
Deferred Tax Assets, Operating Loss Carryforwards, Domestic | 1,936 | 1,936 | ||
Deferred Tax Assets, Operating Loss Carryforwards, State and Local | 1,501 | 1,501 | ||
Federal [Abstract] | ||||
Current | -9,173 | -676 | 7,926 | |
Deferred | 155 | -6,066 | -109 | |
Provision for federal income taxes | -9,018 | -6,742 | 7,817 | |
State [Abstract] | ||||
Current | 21 | 120 | 346 | |
Deferred | 44 | -357 | -10 | |
Provision for state income taxes | 65 | -237 | 336 | |
Income Tax Reconciliation [Abstract] | ||||
Federal taxes | -13,270 | -22,912 | 8,627 | |
State and local taxes, net of federal benefit | 358 | -1,119 | 336 | |
Production deduction | 0 | 0 | -530 | |
Nondeductible goodwill impairment | 9,254 | 0 | 0 | |
Valuation allowance | -5,294 | 17,718 | 0 | |
Research and experimental and other tax credits | -503 | -634 | -300 | |
Other | 502 | -32 | 20 | |
(Benefit) provision for income taxes | ($6,396) | ($8,953) | ($6,979) | $8,153 |
RESTRUCTURING_Details
RESTRUCTURING (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | 3 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2014 |
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and Related Cost, Incurred Cost | $765 | $1,095 | $428 | ||||
Incurred in year ending December 31, 2014 | 3,037 | ||||||
Remaining expense expected to be incurred | 76 | ||||||
Total expense expected to be incurred | 3,113 | ||||||
Unfavorable impact to operating cash flow | 2,268 | ||||||
Restructuring Reserve | 739 | 422 | 422 | 739 | |||
Precise Machine [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and Related Cost, Incurred Cost | 453 | ||||||
Integration expense resulting from reorganization activities | 364 | ||||||
Relocation of Machining Operations from Savannah Facility [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Integration expense resulting from reorganization activities | 500 | ||||||
Relocation of Machining Parts Operations from St. Charles Facility [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Integration expense resulting from reorganization activities | 18 | ||||||
Other Expense [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Incurred in year ending December 31, 2014 | 115 | ||||||
Remaining expense expected to be incurred | 0 | ||||||
Total expense expected to be incurred | 115 | ||||||
Valent Aerostructures, LLC [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and Related Cost, Incurred Cost | 2,620 | ||||||
Unfavorable impact to operating cash flow | 2,620 | ||||||
Employee Severance [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Unfavorable impact to operating cash flow | 2,144 | ||||||
Restructuring Reserve | 739 | 422 | 422 | 739 | |||
Employee Severance [Member] | Precise Machine [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Incurred in year ending December 31, 2014 | 615 | ||||||
Remaining expense expected to be incurred | 0 | ||||||
Total expense expected to be incurred | 615 | ||||||
Employee Severance [Member] | Relocation of Machining Operations from Savannah Facility [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Incurred in year ending December 31, 2014 | 47 | ||||||
Remaining expense expected to be incurred | 0 | ||||||
Total expense expected to be incurred | 47 | ||||||
Employee Severance [Member] | Relocation of Machining Parts Operations from St. Charles Facility [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Incurred in year ending December 31, 2014 | 228 | ||||||
Remaining expense expected to be incurred | 76 | ||||||
Total expense expected to be incurred | 304 | ||||||
Employee Severance [Member] | Other Expense [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Incurred in year ending December 31, 2014 | 1,908 | ||||||
Remaining expense expected to be incurred | 0 | ||||||
Total expense expected to be incurred | 1,908 | ||||||
Lease Termination [Member] | Precise Machine [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Incurred in year ending December 31, 2014 | 124 | ||||||
Remaining expense expected to be incurred | 0 | ||||||
Total expense expected to be incurred | 124 | ||||||
Other [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Unfavorable impact to operating cash flow | 124 | ||||||
Restructuring Reserve | 0 | 0 | 0 | 0 | |||
Selling, General and Administrative Expenses [Member] | Employee Severance [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and Related Cost, Incurred Cost | 228 | ||||||
Selling, General and Administrative Expenses [Member] | Employee Severance [Member] | Precise Machine [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and Related Cost, Incurred Cost | 287 | 453 | |||||
Selling, General and Administrative Expenses [Member] | Employee Severance [Member] | Relocation of Machining Operations from Savannah Facility [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and Related Cost, Incurred Cost | 47 | ||||||
Selling, General and Administrative Expenses [Member] | Employee Severance [Member] | Relocation of Machining Parts Operations from St. Charles Facility [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and Related Cost, Incurred Cost | 228 | ||||||
Selling, General and Administrative Expenses [Member] | Employee Severance [Member] | Other Expense [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring and Related Cost, Incurred Cost | $2,023 |
RESTRUCTURING_ROLLFORWARD_Deta
RESTRUCTURING, ROLLFORWARD (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Restructuring Reserve [Roll Forward] | |||
Accrued restructuring balance, beginning | $422 | ||
Accrual additions | 2,585 | 3,073 | 0 |
Cash payments | -2,268 | ||
Accrued restructuring balance, ending | 739 | 422 | |
Employee Severance [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Accrued restructuring balance, beginning | 422 | ||
Accrual additions | 2,461 | ||
Cash payments | -2,144 | ||
Accrued restructuring balance, ending | 739 | ||
Other [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Accrued restructuring balance, beginning | 0 | ||
Accrual additions | 124 | ||
Cash payments | -124 | ||
Accrued restructuring balance, ending | $0 |
CUSTOMER_AND_SUPPLIER_CONCENTR1
CUSTOMER AND SUPPLIER CONCENTRATION (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
customer | customer | ||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Number of top customers | 3 | 3 | 4 |
Supplier Concentration Risk [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Number of suppliers | 5 | ||
Percentage of materials attributable to supplier (in hundredths) | 47.30% | 44.30% | 51.70% |
Spirit [Member] | Sales Revenue, Goods, Net [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 34.30% | 28.50% | 13.00% |
Spirit [Member] | Accounts Receivable [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 33.30% | 27.80% | 27.90% |
Gulfstream [Member] | Sales Revenue, Goods, Net [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 15.00% | 14.60% | 16.10% |
Gulfstream [Member] | Accounts Receivable [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 6.10% | 8.50% | 5.60% |
Boeing [Member] | Sales Revenue, Goods, Net [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 10.60% | 14.40% | 20.80% |
Boeing [Member] | Accounts Receivable [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 7.40% | 5.70% | 11.30% |
Bombardier [Member] | Sales Revenue, Goods, Net [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 10.10% | ||
Bombardier [Member] | Accounts Receivable [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 6.40% |
BUSINESS_SEGMENT_INFORMATION_D
BUSINESS SEGMENT INFORMATION (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||||
segment | ||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||
Number of reportable segments | 2 | |||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | ||||||||||||||||
Net sales | $88,794 | $97,335 | $105,937 | $95,751 | $96,370 | $104,656 | $105,465 | $106,066 | $387,817 | $412,557 | $278,629 | |||||
Gross profit | 16,732 | 22,043 | [1] | 19,134 | 17,461 | 17,549 | 20,418 | 21,841 | 20,054 | [2] | 75,370 | 79,862 | 68,308 | |||
(Loss) income from operations | -8,858 | -49,120 | 26,055 | |||||||||||||
Other Depreciation and Amortization | 48,898 | 90,361 | 7,994 | |||||||||||||
Interest expense | 29,280 | 16,962 | 1,771 | |||||||||||||
Capital expenditures | 16,690 | 24,149 | 19,529 | |||||||||||||
Total assets | 442,436 | 480,051 | 442,436 | 480,051 | ||||||||||||
Impairment loss on goodwill | 26,439 | 26,439 | [3] | 73,528 | [4] | |||||||||||
Impairment loss on intangible assets | 0 | [5] | 4,222 | [6] | ||||||||||||
Write off of Deferred Debt Issuance Cost | 8,340 | 8,466 | 0 | 0 | ||||||||||||
Debt Related Commitment Fees and Debt Issuance Costs | 580 | |||||||||||||||
Equipment acquired under capital lease | 0 | 411 | 746 | |||||||||||||
Aerostructures [Member] | ||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | ||||||||||||||||
Net sales | 326,025 | 331,654 | 174,983 | |||||||||||||
Gross profit | 67,042 | 68,088 | 47,947 | |||||||||||||
(Loss) income from operations | 18,977 | -46,050 | [7],[8] | 15,484 | ||||||||||||
Other Depreciation and Amortization | 20,223 | 91,557 | [8] | 5,532 | ||||||||||||
Interest expense | 1,041 | 1,054 | 23 | |||||||||||||
Capital expenditures | 16,504 | 23,600 | [9] | 18,649 | [9] | |||||||||||
Total assets | 399,689 | 405,779 | 399,689 | 405,779 | ||||||||||||
Equipment acquired under capital lease | 411 | 746 | ||||||||||||||
Engineering Services [Member] | ||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | ||||||||||||||||
Net sales | 63,404 | 83,717 | 105,607 | |||||||||||||
Gross profit | 8,428 | 12,145 | 20,270 | |||||||||||||
(Loss) income from operations | -27,731 | [10] | -2,699 | [11] | 10,480 | |||||||||||
Other Depreciation and Amortization | 28,675 | [10] | 6,754 | [11] | 2,462 | |||||||||||
Interest expense | 41 | 53 | 25 | |||||||||||||
Capital expenditures | 186 | 549 | 880 | |||||||||||||
Total assets | 42,747 | 74,272 | 42,747 | 74,272 | ||||||||||||
Impairment loss on intangible assets | 4,222 | |||||||||||||||
Eliminations [Member] | ||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | ||||||||||||||||
Net sales | -1,612 | -2,814 | -1,961 | |||||||||||||
Gross profit | -100 | -371 | 91 | |||||||||||||
(Loss) income from operations | -104 | -371 | 91 | |||||||||||||
Corporate [Member] | ||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | ||||||||||||||||
Other Depreciation and Amortization | 0 | 0 | ||||||||||||||
Interest expense | 28,198 | [12] | 15,855 | 1,723 | [12] | |||||||||||
Other Nonrecurring Income | -7,950 | [7] | ||||||||||||||
Engineering Services [Member] | ||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | ||||||||||||||||
Impairment loss on goodwill | 26,439 | |||||||||||||||
Valent Aerostructures, LLC [Member] | ||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | ||||||||||||||||
Impairment loss on goodwill | $73,528 | $73,528 | ||||||||||||||
[1] | Gross profit in the third quarter of 2014 includes a $5,286 favorable cumulative catch-up adjustment related to the settlement of an unpriced change order and the Company's ability to secure more favorable future material pricing on a long-term production contract. In addition, net income in the third quarter of 2014 includes $765 of restructuring expenses. | |||||||||||||||
[2] | The first quarter of 2013 included $2,497 of non-recurring inventory step-up related to the Valent acquisition. | |||||||||||||||
[3] | During the fourth quarter of 2014, the Company performed its annual impairment analysis of goodwill. As a result of the analysis, the goodwill related to the Engineering Services reporting unit was deemed impaired, and a $26,439 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2014. | |||||||||||||||
[4] | In 2013, the goodwill related to the Valent acquisition was deemed impaired, and a $73,528 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | |||||||||||||||
[5] | The fair values of intangibles relating to the 2012 acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. | |||||||||||||||
[6] | During the second quarter of 2013, a triggering event occurred when the Company commenced an initiative to rebrand its core engineering business. Under this initiative, the D3 Technologies name became obsolete and the $4,222 indefinite lived intangible asset related to that trade name was deemed to be fully impaired and a loss was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | |||||||||||||||
[7] | Includes the write-off of contingent consideration of $7,950 in 2013. | |||||||||||||||
[8] | Includes a $73,528 for goodwill impairment in 2013. | |||||||||||||||
[9] | Includes $411 and $746 associated with capital leases in 2013 and 2012, respectively. | |||||||||||||||
[10] | Includes a $26,439 for goodwill impairment in 2014. | |||||||||||||||
[11] | Includes a $4,222 charge for impairment of intangible 2013 | |||||||||||||||
[12] | Includes $8,466 and $580 related to the write-off of deferred financing costs in 2014 and 2012, respectively. |
QUARTERLY_FINANCIAL_DATA_UNAUD2
QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||||||||
Restructuring and Related Cost, Incurred Cost | $765 | $1,095 | $428 | |||||||||||||||||
Change in Accounting Estimate, Amount, Favorable Financial Effect on Operating Income | 5,286 | |||||||||||||||||||
Impairment loss on goodwill | 26,439 | 26,439 | [1] | 73,528 | [2] | |||||||||||||||
Derivative, Loss on Derivative | 793 | [3] | 793 | [3] | ||||||||||||||||
Write off of Deferred Debt Issuance Cost | 8,340 | 8,466 | 0 | 0 | ||||||||||||||||
Income Tax Expense (Benefit) | 6,396 | 8,953 | 6,979 | -8,153 | ||||||||||||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||
Net sales | 88,794 | 97,335 | 105,937 | 95,751 | 96,370 | 104,656 | 105,465 | 106,066 | 387,817 | 412,557 | 278,629 | |||||||||
Gross profit | 16,732 | 22,043 | [4] | 19,134 | 17,461 | 17,549 | 20,418 | 21,841 | 20,054 | [5] | 75,370 | 79,862 | 68,308 | |||||||
Net income (loss) | -22,505 | [6] | 1,396 | [4] | -7,411 | [7] | -442 | [8] | -67,061 | [9] | 2,075 | 4,664 | [10] | 1,837 | [5] | -28,962 | -58,485 | 16,487 | ||
Amounts per common share: | ||||||||||||||||||||
Net income (loss) (in dollars per share) | ($1.76) | [6] | $0.11 | [4] | ($0.58) | [7] | ($0.03) | [8] | ($5.31) | [9] | $0.16 | $0.37 | [10] | $0.15 | [5] | ($2.28) | ($4.64) | $1.41 | ||
Net income (loss) - assuming dilution (in dollars per share) | ($1.76) | [6] | $0.11 | [4] | ($0.58) | [7] | ($0.03) | [8] | ($5.31) | [9] | $0.16 | $0.37 | [10] | $0.14 | [5] | ($2.28) | ($4.64) | $1.39 | ||
Selling, General and Administrative Expenses [Member] | Employee Severance [Member] | ||||||||||||||||||||
Restructuring and Related Cost, Incurred Cost | $228 | |||||||||||||||||||
[1] | During the fourth quarter of 2014, the Company performed its annual impairment analysis of goodwill. As a result of the analysis, the goodwill related to the Engineering Services reporting unit was deemed impaired, and a $26,439 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2014. | |||||||||||||||||||
[2] | In 2013, the goodwill related to the Valent acquisition was deemed impaired, and a $73,528 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | |||||||||||||||||||
[3] | In 2014, the Company terminated and settled its interest rate derivatives in conjunction with the settlement of its then existing credit agreement. | |||||||||||||||||||
[4] | Gross profit in the third quarter of 2014 includes a $5,286 favorable cumulative catch-up adjustment related to the settlement of an unpriced change order and the Company's ability to secure more favorable future material pricing on a long-term production contract. In addition, net income in the third quarter of 2014 includes $765 of restructuring expenses. | |||||||||||||||||||
[5] | The first quarter of 2013 included $2,497 of non-recurring inventory step-up related to the Valent acquisition. | |||||||||||||||||||
[6] | Net loss in the fourth quarter of 2014 includes a $26,439 goodwill impairment charge related to the Engineering Services reporting unit, $228 of restructuring expenses and a $6,396 income tax benefit resulting from the decision to carry the 2014 tax loss back to previous years. | |||||||||||||||||||
[7] | Net loss in the second quarter of 2014 includes $793 of interest expense related to the termination of interest rate derivatives and $8,340 related to the write-off of debt issuance costs associated with the modification of the Company's revolving credit facility and the termination of its long-term credit agreement. Net loss in the second quarter of 2014 also includes $1,095 of restructuring expenses. | |||||||||||||||||||
[8] | Included in the net loss for the the first quarter of 2014 were $428 of restructuring expenses. | |||||||||||||||||||
[9] | The fourth quarter of 2013 included a goodwill impairment charge of $73,528 related to the Valent acquisition, $17,718 related to income tax valuation allowance, $2,620 related to a separation agreement reached with key members of Valent Aerostructures, LLC. and $453 of restructuring expenses related to the closure of the Precise Machine facility. In addition, Valent gross profit was unfavorably impacted by $955 in cumulative catch-up adjustments, the result of higher levels of indirect costs required to meet customer demand. | |||||||||||||||||||
[10] | The second quarter of 2013 included a trade name impairment of $4,222 related to D3 Technologies offset by a contingent consideration write-off of $7,950 related to Valent. |
QUARTERLY_FINANCIAL_DATA_UNAUD3
QUARTERLY FINANCIAL DATA (UNAUDITED), ACQUISITION-RELATED (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | ||
Business Acquisition [Line Items] | ||||||||||||
Impairment loss on intangible assets | $0 | [1] | $4,222 | [2] | ||||||||
Contingent consideration write-off | 0 | 7,950 | 0 | |||||||||
Impairment loss on goodwill | 26,439 | 26,439 | [3] | 73,528 | [4] | |||||||
Valuation allowance | -5,294 | 17,718 | 0 | |||||||||
Restructuring and Related Cost, Incurred Cost | 765 | 1,095 | 428 | |||||||||
Acquisitions expense | 0 | 247 | 5,362 | |||||||||
Precise Machine [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Restructuring and Related Cost, Incurred Cost | 453 | |||||||||||
D3 Technologies, Inc. [Member] | Trademarks [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Impairment loss on intangible assets | 4,222 | |||||||||||
Valent Aerostructures, LLC [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Non-recurring inventory step-up | 2,497 | |||||||||||
Contingent consideration write-off | 7,950 | |||||||||||
Impairment loss on goodwill | 73,528 | 73,528 | ||||||||||
Restructuring and Related Cost, Incurred Cost | 2,620 | |||||||||||
Unfavorable adjustments | 955 | |||||||||||
Acquisitions expense | $5,107 | |||||||||||
[1] | The fair values of intangibles relating to the 2012 acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. | |||||||||||
[2] | During the second quarter of 2013, a triggering event occurred when the Company commenced an initiative to rebrand its core engineering business. Under this initiative, the D3 Technologies name became obsolete and the $4,222 indefinite lived intangible asset related to that trade name was deemed to be fully impaired and a loss was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | |||||||||||
[3] | During the fourth quarter of 2014, the Company performed its annual impairment analysis of goodwill. As a result of the analysis, the goodwill related to the Engineering Services reporting unit was deemed impaired, and a $26,439 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2014. | |||||||||||
[4] | In 2013, the goodwill related to the Valent acquisition was deemed impaired, and a $73,528 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. |
CONDENSED_CONSOLIDATING_BALANC
CONDENSED CONSOLIDATING BALANCE SHEET (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Cash and cash equivalents | $7,927 | $1,572 | $4,347 | $7,868 |
Trade accounts receivable, net | 58,234 | 72,853 | ||
Intercompany receivables | 0 | 0 | ||
Inventories | 114,279 | 113,178 | ||
Prepaid expenses and other current assets | 10,255 | 4,411 | ||
Deferred income taxes | 3,913 | 2,693 | ||
Total current assets | 194,608 | 194,707 | ||
Property, plant and equipment, net | 99,482 | 103,375 | ||
Investments in subsidiaries | 0 | 0 | ||
Goodwill | 86,784 | 113,223 | ||
Intangible assets, net | 50,940 | 55,465 | ||
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | 0 | 0 | ||
Other assets | 10,622 | 13,281 | ||
Total assets | 442,436 | 480,051 | ||
Accounts payable | 21,755 | 19,904 | ||
Accrued expenses | 26,072 | 18,566 | ||
Intercompany payables | 0 | 0 | ||
Deferred income taxes | 0 | 0 | ||
Current installments of long-term debt and capital lease obligations | 3,424 | 5,242 | ||
Total current liabilities | 51,251 | 43,712 | ||
Long-term debt and capital lease obligations, less current installments | 265,554 | 285,369 | ||
Other long-term liabilities | 3,289 | 3,915 | ||
Deferred income taxes | 4,207 | 2,911 | ||
Total long-term liabilities | 273,050 | 292,195 | ||
Total shareholders’ equity | 118,135 | 144,144 | 200,954 | 167,785 |
Total liabilities and shareholders’ equity | 442,436 | 480,051 | ||
LMIA(Guarantor Parent) | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Cash and cash equivalents | 7,058 | 405 | 3,770 | 7,834 |
Trade accounts receivable, net | 1,310 | 14,783 | ||
Intercompany receivables | 145,980 | 152,143 | ||
Inventories | 0 | 0 | ||
Prepaid expenses and other current assets | 8,325 | 2,385 | ||
Deferred income taxes | 0 | 0 | ||
Total current assets | 162,673 | 169,716 | ||
Property, plant and equipment, net | 3,148 | 7,022 | ||
Investments in subsidiaries | 368,587 | 378,707 | ||
Goodwill | 0 | 0 | ||
Intangible assets, net | 0 | 0 | ||
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | 118 | 135 | ||
Other assets | 8,743 | 11,152 | ||
Total assets | 543,269 | 566,732 | ||
Accounts payable | 1,339 | 3,415 | ||
Accrued expenses | 13,679 | 2,560 | ||
Intercompany payables | 164,158 | 152,743 | ||
Deferred income taxes | 118 | 135 | ||
Current installments of long-term debt and capital lease obligations | 335 | 2,827 | ||
Total current liabilities | 179,629 | 161,680 | ||
Long-term debt and capital lease obligations, less current installments | 245,174 | 260,148 | ||
Other long-term liabilities | 331 | 760 | ||
Deferred income taxes | 0 | 0 | ||
Total long-term liabilities | 245,505 | 260,908 | ||
Total shareholders’ equity | 118,135 | 144,144 | ||
Total liabilities and shareholders’ equity | 543,269 | 566,732 | ||
Guarantor Subsidiaries | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Cash and cash equivalents | 869 | 1,167 | 577 | 34 |
Trade accounts receivable, net | 56,924 | 58,070 | ||
Intercompany receivables | 145,223 | 142,111 | ||
Inventories | 114,279 | 113,178 | ||
Prepaid expenses and other current assets | 1,930 | 2,026 | ||
Deferred income taxes | 4,031 | 2,800 | ||
Total current assets | 323,256 | 319,352 | ||
Property, plant and equipment, net | 96,334 | 96,353 | ||
Investments in subsidiaries | 0 | |||
Goodwill | 86,784 | 113,223 | ||
Intangible assets, net | 50,940 | 55,465 | ||
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | 0 | 0 | ||
Other assets | 1,879 | 2,129 | ||
Total assets | 559,193 | 586,522 | ||
Accounts payable | 20,416 | 16,489 | ||
Accrued expenses | 12,393 | 16,006 | ||
Intercompany payables | 127,045 | 141,511 | ||
Deferred income taxes | 0 | 0 | ||
Current installments of long-term debt and capital lease obligations | 3,089 | 2,415 | ||
Total current liabilities | 162,943 | 176,421 | ||
Long-term debt and capital lease obligations, less current installments | 20,380 | 25,221 | ||
Other long-term liabilities | 2,958 | 3,155 | ||
Deferred income taxes | 4,325 | 3,018 | ||
Total long-term liabilities | 27,663 | 31,394 | ||
Total shareholders’ equity | 368,587 | 378,707 | ||
Total liabilities and shareholders’ equity | 559,193 | 586,522 | ||
Consolidating/Eliminating Entries | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Trade accounts receivable, net | 0 | 0 | ||
Intercompany receivables | -291,203 | -294,254 | ||
Inventories | 0 | 0 | ||
Prepaid expenses and other current assets | 0 | 0 | ||
Deferred income taxes | -118 | -107 | ||
Total current assets | -291,321 | -294,361 | ||
Property, plant and equipment, net | 0 | 0 | ||
Investments in subsidiaries | -368,587 | -378,707 | ||
Goodwill | 0 | 0 | ||
Intangible assets, net | 0 | 0 | ||
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | -118 | -135 | ||
Other assets | 0 | 0 | ||
Total assets | -660,026 | -673,203 | ||
Accounts payable | 0 | 0 | ||
Accrued expenses | 0 | 0 | ||
Intercompany payables | -291,203 | -294,254 | ||
Deferred income taxes | -118 | -135 | ||
Current installments of long-term debt and capital lease obligations | 0 | 0 | ||
Total current liabilities | -291,321 | -294,389 | ||
Long-term debt and capital lease obligations, less current installments | 0 | 0 | ||
Other long-term liabilities | 0 | 0 | ||
Deferred income taxes | -118 | -107 | ||
Total long-term liabilities | -118 | -107 | ||
Total shareholders’ equity | -368,587 | -378,707 | ||
Total liabilities and shareholders’ equity | ($660,026) | ($673,203) |
CONDENSED_CONSOLIDATING_STATEM
CONDENSED CONSOLIDATING STATEMENTS OF COMREHENSIVE INCOME (LOSS) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||||||
Condensed Income Statements, Captions [Line Items] | |||||||||||||||||||
Product sales | $321,284 | $324,133 | $168,943 | ||||||||||||||||
Service revenues | 66,533 | 88,424 | 109,686 | ||||||||||||||||
Net sales | 88,794 | 97,335 | 105,937 | 95,751 | 96,370 | 104,656 | 105,465 | 106,066 | 387,817 | 412,557 | 278,629 | ||||||||
Cost of product sales | 254,775 | 255,261 | 121,247 | ||||||||||||||||
Cost of service revenues | 57,672 | 77,434 | 89,074 | ||||||||||||||||
Cost of sales | 312,447 | 332,695 | 210,321 | ||||||||||||||||
Gross profit | 16,732 | 22,043 | [1] | 19,134 | 17,461 | 17,549 | 20,418 | 21,841 | 20,054 | [2] | 75,370 | 79,862 | 68,308 | ||||||
Selling, general and administrative expenses | 55,204 | 55,862 | 36,891 | ||||||||||||||||
Goodwill and intangible asset impairment | 26,439 | 77,750 | 0 | ||||||||||||||||
Contingent consideration write-off | -7,950 | 0 | -7,950 | [3] | 0 | ||||||||||||||
Restructuring expense | 2,585 | 3,073 | 0 | ||||||||||||||||
Acquisitions expense | 0 | 247 | 5,362 | ||||||||||||||||
(Loss) income from operations | -8,858 | -49,120 | 26,055 | ||||||||||||||||
Interest expense | -29,280 | -16,962 | -1,771 | ||||||||||||||||
Other, net | 223 | 618 | 356 | ||||||||||||||||
Income (loss) from equity investments in subsidiaries | 0 | 0 | 0 | ||||||||||||||||
Total other expense | -29,057 | -16,344 | -1,415 | ||||||||||||||||
(Loss) income before income taxes | -37,915 | -65,464 | 24,640 | ||||||||||||||||
(Benefit) provision for income taxes | -6,396 | -8,953 | -6,979 | 8,153 | |||||||||||||||
Net (loss)/income | -22,505 | [4] | 1,396 | [1] | -7,411 | [5] | -442 | [6] | -67,061 | [7] | 2,075 | 4,664 | [8] | 1,837 | [2] | -28,962 | -58,485 | 16,487 | |
Change in foreign currency translation adjustment | -98 | -23 | -49 | ||||||||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | 278 | 0 | 0 | ||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, ($157), and $0 | 0 | -278 | 0 | ||||||||||||||||
Total comprehensive (loss) income | -28,782 | -58,786 | 16,438 | ||||||||||||||||
LMIA(Guarantor Parent) | |||||||||||||||||||
Condensed Income Statements, Captions [Line Items] | |||||||||||||||||||
Product sales | 466 | 4,388 | 825 | ||||||||||||||||
Service revenues | 36,181 | 41,578 | 36,713 | ||||||||||||||||
Net sales | 36,647 | 45,966 | 37,538 | ||||||||||||||||
Cost of product sales | 699 | 4,290 | 772 | ||||||||||||||||
Cost of service revenues | 35,998 | 41,533 | 36,706 | ||||||||||||||||
Cost of sales | 36,697 | 45,823 | 37,478 | ||||||||||||||||
Gross profit | -50 | 143 | 60 | ||||||||||||||||
Selling, general and administrative expenses | 792 | 0 | 0 | ||||||||||||||||
Goodwill and intangible asset impairment | 0 | 0 | 0 | ||||||||||||||||
Contingent consideration write-off | 0 | -7,950 | 0 | ||||||||||||||||
Restructuring expense | 1,011 | 4 | 0 | ||||||||||||||||
Acquisitions expense | 0 | 229 | 5,337 | ||||||||||||||||
(Loss) income from operations | -1,853 | 7,860 | -5,277 | ||||||||||||||||
Interest expense | -28,224 | -15,887 | -1,727 | ||||||||||||||||
Other, net | 11 | 95 | 7 | ||||||||||||||||
Income (loss) from equity investments in subsidiaries | -8,860 | -52,206 | 20,977 | ||||||||||||||||
Total other expense | -37,073 | -67,998 | 19,257 | ||||||||||||||||
(Loss) income before income taxes | -38,926 | -60,138 | 13,980 | ||||||||||||||||
(Benefit) provision for income taxes | -9,867 | -1,702 | -2,507 | ||||||||||||||||
Net (loss)/income | -29,059 | -58,436 | 16,487 | ||||||||||||||||
Change in foreign currency translation adjustment | 0 | 0 | 0 | ||||||||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | 278 | 0 | 0 | ||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, ($157), and $0 | 0 | -278 | 0 | ||||||||||||||||
Total comprehensive (loss) income | -28,781 | -58,714 | 16,487 | ||||||||||||||||
Guarantor Subsidiaries | |||||||||||||||||||
Condensed Income Statements, Captions [Line Items] | |||||||||||||||||||
Product sales | 321,286 | 169,000 | |||||||||||||||||
Service revenues | 66,543 | 109,616 | |||||||||||||||||
Net sales | 387,829 | 412,596 | 278,616 | ||||||||||||||||
Cost of product sales | 254,544 | 255,681 | 121,357 | ||||||||||||||||
Cost of service revenues | 57,864 | 77,124 | 88,964 | ||||||||||||||||
Cost of sales | 312,408 | 332,805 | 210,321 | ||||||||||||||||
Gross profit | 75,421 | 79,791 | 68,295 | ||||||||||||||||
Selling, general and administrative expenses | 54,412 | 55,862 | 36,891 | ||||||||||||||||
Goodwill and intangible asset impairment | 26,439 | 77,750 | 0 | ||||||||||||||||
Contingent consideration write-off | 0 | 0 | 0 | ||||||||||||||||
Restructuring expense | 1,574 | 3,069 | 0 | ||||||||||||||||
Acquisitions expense | 0 | 18 | 25 | ||||||||||||||||
(Loss) income from operations | -7,004 | -56,908 | 31,379 | ||||||||||||||||
Interest expense | -1,056 | -1,075 | -44 | ||||||||||||||||
Other, net | 212 | 523 | 349 | ||||||||||||||||
Income (loss) from equity investments in subsidiaries | 0 | 0 | 0 | ||||||||||||||||
Total other expense | -844 | -552 | 305 | ||||||||||||||||
(Loss) income before income taxes | -7,848 | -57,460 | 31,684 | ||||||||||||||||
(Benefit) provision for income taxes | 914 | -5,277 | 10,660 | ||||||||||||||||
Net (loss)/income | -8,762 | -52,183 | 21,024 | ||||||||||||||||
Change in foreign currency translation adjustment | -98 | -23 | -49 | ||||||||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | 0 | 0 | 0 | ||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, ($157), and $0 | 0 | 0 | 0 | ||||||||||||||||
Total comprehensive (loss) income | -8,860 | -52,206 | 20,975 | ||||||||||||||||
Guarantor Subsidiaries | |||||||||||||||||||
Condensed Income Statements, Captions [Line Items] | |||||||||||||||||||
Product sales | 324,455 | ||||||||||||||||||
Service revenues | 88,141 | ||||||||||||||||||
Consolidating/Eliminating Entries | |||||||||||||||||||
Condensed Income Statements, Captions [Line Items] | |||||||||||||||||||
Product sales | -468 | -4,710 | -882 | ||||||||||||||||
Service revenues | -36,191 | -41,295 | -36,643 | ||||||||||||||||
Net sales | -36,659 | -46,005 | -37,525 | ||||||||||||||||
Cost of product sales | -468 | -4,710 | -882 | ||||||||||||||||
Cost of service revenues | -36,190 | -41,223 | -36,596 | ||||||||||||||||
Cost of sales | -36,658 | -45,933 | -37,478 | ||||||||||||||||
Gross profit | -1 | -72 | -47 | ||||||||||||||||
Selling, general and administrative expenses | 0 | 0 | 0 | ||||||||||||||||
Goodwill and intangible asset impairment | 0 | 0 | 0 | ||||||||||||||||
Contingent consideration write-off | 0 | 0 | 0 | ||||||||||||||||
Restructuring expense | 0 | 0 | 0 | ||||||||||||||||
Acquisitions expense | 0 | 0 | 0 | ||||||||||||||||
(Loss) income from operations | -1 | -72 | -47 | ||||||||||||||||
Interest expense | 0 | 0 | 0 | ||||||||||||||||
Other, net | 0 | 0 | 0 | ||||||||||||||||
Income (loss) from equity investments in subsidiaries | 8,860 | 52,206 | -20,977 | ||||||||||||||||
Total other expense | 8,860 | 52,206 | -20,977 | ||||||||||||||||
(Loss) income before income taxes | 8,859 | 52,134 | -21,024 | ||||||||||||||||
(Benefit) provision for income taxes | 0 | 0 | 0 | ||||||||||||||||
Net (loss)/income | 8,859 | 52,134 | -21,024 | ||||||||||||||||
Change in foreign currency translation adjustment | 0 | 0 | 0 | ||||||||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | 0 | 0 | 0 | ||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, ($157), and $0 | 0 | 0 | 0 | ||||||||||||||||
Total comprehensive (loss) income | $8,859 | $52,134 | ($21,024) | ||||||||||||||||
[1] | Gross profit in the third quarter of 2014 includes a $5,286 favorable cumulative catch-up adjustment related to the settlement of an unpriced change order and the Company's ability to secure more favorable future material pricing on a long-term production contract. In addition, net income in the third quarter of 2014 includes $765 of restructuring expenses. | ||||||||||||||||||
[2] | The first quarter of 2013 included $2,497 of non-recurring inventory step-up related to the Valent acquisition. | ||||||||||||||||||
[3] | The Monte Carlo simulation was used with a normal probability distribution of the best estimate of EBITDA for 2013 to approximate fair value. At June 30, 2013, the EBITDA target was not expected to occur and, as such, the $7,950 of contingent consideration was deemed unlikely to be paid, and a benefit was recorded on a separate line in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2013. | ||||||||||||||||||
[4] | Net loss in the fourth quarter of 2014 includes a $26,439 goodwill impairment charge related to the Engineering Services reporting unit, $228 of restructuring expenses and a $6,396 income tax benefit resulting from the decision to carry the 2014 tax loss back to previous years. | ||||||||||||||||||
[5] | Net loss in the second quarter of 2014 includes $793 of interest expense related to the termination of interest rate derivatives and $8,340 related to the write-off of debt issuance costs associated with the modification of the Company's revolving credit facility and the termination of its long-term credit agreement. Net loss in the second quarter of 2014 also includes $1,095 of restructuring expenses. | ||||||||||||||||||
[6] | Included in the net loss for the the first quarter of 2014 were $428 of restructuring expenses. | ||||||||||||||||||
[7] | The fourth quarter of 2013 included a goodwill impairment charge of $73,528 related to the Valent acquisition, $17,718 related to income tax valuation allowance, $2,620 related to a separation agreement reached with key members of Valent Aerostructures, LLC. and $453 of restructuring expenses related to the closure of the Precise Machine facility. In addition, Valent gross profit was unfavorably impacted by $955 in cumulative catch-up adjustments, the result of higher levels of indirect costs required to meet customer demand. | ||||||||||||||||||
[8] | The second quarter of 2013 included a trade name impairment of $4,222 related to D3 Technologies offset by a contingent consideration write-off of $7,950 related to Valent. |
CONDENSED_CONSOLIDATING_STATEM1
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net (loss)/income | ($28,962) | ($58,485) | $16,487 |
Adjustments for non-cash items | 59,351 | 85,495 | 8,109 |
Net changes in operating assets and liabilities, net of acquired businesses | 18,728 | -35,359 | -15,797 |
Intercompany activity | 0 | 0 | 0 |
Net cash provided/(used) by operating activities | 49,117 | -8,349 | 8,799 |
Additions to property, plant and equipment | -16,690 | -23,738 | -18,783 |
Acquisitions, net of cash acquired | 0 | -504 | -216,398 |
Proceeds from sale of equipment | 3,579 | 1,989 | 181 |
Net cash used by investing activities | -13,111 | -22,253 | -235,000 |
Proceeds from issuance of debt | 250,000 | 5,751 | 229,124 |
Principal payments on long-term debt and notes payable | -235,633 | -5,863 | -118 |
Advances on revolving line of credit | 66,000 | 107,000 | 40,278 |
Payments on revolving line of credit | -102,000 | -77,236 | -34,042 |
Payments for debt issuance cost | -8,018 | -1,817 | -12,736 |
Other, net | 0 | -8 | 174 |
Net cash (used)/provided by financing activities | -29,651 | 27,827 | 222,680 |
Net increase/(decrease) in cash and cash equivalents | 6,355 | -2,775 | -3,521 |
Cash and cash equivalents, beginning of year | 1,572 | 4,347 | 7,868 |
Cash and cash equivalents, end of year | 7,927 | 1,572 | 4,347 |
LMIA(Guarantor Parent) | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net (loss)/income | -29,059 | -58,436 | 16,487 |
Adjustments for non-cash items | 21,713 | 46,716 | -28,544 |
Net changes in operating assets and liabilities, net of acquired businesses | 19,977 | 696 | 2,195 |
Intercompany activity | 17,663 | -12,974 | 912 |
Net cash provided/(used) by operating activities | 30,294 | -23,998 | -8,950 |
Additions to property, plant and equipment | -715 | -4,623 | -406 |
Acquisitions, net of cash acquired | 0 | -504 | -216,398 |
Proceeds from sale of equipment | 2,558 | 0 | 11 |
Net cash used by investing activities | 1,843 | -5,127 | -216,793 |
Proceeds from issuance of debt | 250,000 | 3,551 | 228,123 |
Principal payments on long-term debt and notes payable | -231,466 | -5,767 | -118 |
Advances on revolving line of credit | 66,000 | 107,000 | 40,278 |
Payments on revolving line of credit | -102,000 | -77,236 | -34,042 |
Payments for debt issuance cost | -8,018 | -1,780 | -12,736 |
Other, net | 0 | -8 | 174 |
Net cash (used)/provided by financing activities | -25,484 | 25,760 | 221,679 |
Net increase/(decrease) in cash and cash equivalents | 6,653 | -3,365 | -4,064 |
Cash and cash equivalents, beginning of year | 405 | 3,770 | 7,834 |
Cash and cash equivalents, end of year | 7,058 | 405 | 3,770 |
Guarantor Subsidiaries | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net (loss)/income | -8,762 | -52,183 | 21,024 |
Adjustments for non-cash items | 46,497 | 90,913 | 15,411 |
Net changes in operating assets and liabilities, net of acquired businesses | -1,249 | -36,055 | -17,993 |
Intercompany activity | -17,663 | 12,974 | -693 |
Net cash provided/(used) by operating activities | 18,823 | 15,649 | 17,749 |
Additions to property, plant and equipment | -15,975 | -19,115 | -18,377 |
Acquisitions, net of cash acquired | 0 | 0 | 0 |
Proceeds from sale of equipment | 1,021 | 1,989 | 170 |
Net cash used by investing activities | -14,954 | -17,126 | -18,207 |
Proceeds from issuance of debt | 0 | 2,200 | 1,001 |
Principal payments on long-term debt and notes payable | -4,167 | -96 | 0 |
Advances on revolving line of credit | 0 | 0 | 0 |
Payments on revolving line of credit | 0 | 0 | 0 |
Payments for debt issuance cost | 0 | -37 | 0 |
Other, net | 0 | 0 | 0 |
Net cash (used)/provided by financing activities | -4,167 | 2,067 | 1,001 |
Net increase/(decrease) in cash and cash equivalents | -298 | 590 | 543 |
Cash and cash equivalents, beginning of year | 1,167 | 577 | 34 |
Cash and cash equivalents, end of year | 869 | 1,167 | 577 |
Consolidating/Eliminating Entries | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net (loss)/income | 8,859 | 52,134 | -21,024 |
Adjustments for non-cash items | -8,859 | -52,134 | 21,242 |
Net changes in operating assets and liabilities, net of acquired businesses | 0 | 0 | 1 |
Intercompany activity | 0 | 0 | -219 |
Net cash provided/(used) by operating activities | 0 | 0 | 0 |
Additions to property, plant and equipment | 0 | 0 | 0 |
Acquisitions, net of cash acquired | 0 | 0 | 0 |
Proceeds from sale of equipment | 0 | 0 | 0 |
Net cash used by investing activities | 0 | 0 | 0 |
Proceeds from issuance of debt | 0 | 0 | 0 |
Principal payments on long-term debt and notes payable | 0 | 0 | 0 |
Advances on revolving line of credit | 0 | 0 | 0 |
Payments on revolving line of credit | 0 | 0 | 0 |
Payments for debt issuance cost | 0 | 0 | 0 |
Other, net | 0 | 0 | 0 |
Net cash (used)/provided by financing activities | 0 | 0 | 0 |
Net increase/(decrease) in cash and cash equivalents | 0 | 0 | 0 |
Cash and cash equivalents, beginning of year | 0 | 0 | 0 |
Cash and cash equivalents, end of year | $0 | $0 | $0 |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) (Subsequent Event [Member], USD $) | 2 Months Ended | 3 Months Ended |
Mar. 10, 2015 | Mar. 31, 2015 | |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Payments for Other Operating Activities | $4,800 | $1,700 |
SCHEDULE_II_VALUATION_AND_QUAL1
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Reserve for Accounts Receivable [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning Balance | $180 | $287 | $359 |
Charge to Cost/Expense | 309 | -27 | -140 |
Other Charge to Cost/Expense | 0 | 0 | 86 |
Write-offs net of Recoveries | -25 | -80 | -18 |
Ending Balance | 464 | 180 | 287 |
Valuation Allowance of Deferred Tax Assets [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning Balance | 18,137 | 261 | 0 |
Charge to Cost/Expense | 0 | 17,876 | 261 |
Other Charge to Cost/Expense | -5,461 | 0 | 0 |
Write-offs net of Recoveries | 0 | 0 | 0 |
Ending Balance | $12,676 | $18,137 | $261 |