Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 01, 2017 | Jun. 30, 2016 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | LMI AEROSPACE INC | ||
Entity Central Index Key | 1,059,562 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 91,404,316 | ||
Entity Common Stock, Shares Outstanding | 13,621,267 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 2,491 | $ 10,504 |
Trade accounts receivable, net | 51,269 | 48,491 |
Inventories | 122,761 | 114,775 |
Prepaid expenses and other current assets | 3,586 | 4,147 |
Total current assets | 180,107 | 177,917 |
Property, plant and equipment, net | 99,515 | 100,969 |
Goodwill | 62,482 | 86,784 |
Intangible assets, net | 38,852 | 46,582 |
Other assets | 2,676 | 3,728 |
Total assets | 383,632 | 415,980 |
Current liabilities: | ||
Accounts payable | 29,378 | 13,156 |
Accrued expenses | 25,543 | 30,015 |
Current installments of long-term debt and capital lease obligations | 2,655 | 2,362 |
Total current liabilities | 57,576 | 45,533 |
Long-term debt and capital lease obligations, less current installments | 237,398 | 247,633 |
Other long-term liabilities | 3,117 | 4,322 |
Deferred income taxes | 0 | 536 |
Total long-term liabilities | 240,515 | 252,491 |
Shareholders’ equity: | ||
Common stock, $0.02 par value per share; authorized 28,000,000 shares; issued 13,625,205 and 13,287,688 shares at December 31, 2016 and December 31, 2015, respectively | 273 | 266 |
Preferred stock, $0.02 par value per share; authorized 2,000,000 shares; none issued at either date | 0 | 0 |
Additional paid-in capital | 99,955 | 97,617 |
Accumulated other comprehensive loss | (282) | (211) |
Treasury stock, at cost, 39,419 shares at December 31, 2015 | 0 | (418) |
Retained (deficit) earnings | (14,405) | 20,702 |
Total shareholders’ equity | 85,541 | 117,956 |
Total liabilities and shareholders’ equity | $ 383,632 | $ 415,980 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
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) | 13,625,205 | 13,287,688 |
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) | 0 | 39,419 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||||||||
Sales and service revenue | ||||||||||||||||||||
Product sales | $ 308,089 | $ 323,611 | $ 321,284 | |||||||||||||||||
Service revenues | 38,091 | 51,485 | 66,533 | |||||||||||||||||
Net sales | $ 85,183 | $ 89,673 | $ 83,993 | $ 87,331 | $ 89,438 | $ 95,633 | $ 97,550 | $ 92,475 | 346,180 | 375,096 | 387,817 | |||||||||
Cost of sales and service revenue | ||||||||||||||||||||
Cost of product sales | 249,227 | 259,610 | 254,775 | |||||||||||||||||
Cost of service revenues | 37,150 | 46,700 | 57,672 | |||||||||||||||||
Cost of sales | 286,377 | 306,310 | 312,447 | |||||||||||||||||
Gross profit | 12,192 | [1] | 15,846 | 15,535 | 16,230 | 16,193 | [2] | 16,626 | [3] | 18,770 | 17,197 | 59,803 | 68,786 | 75,370 | ||||||
Selling, general and administrative expenses | 44,541 | 45,678 | 55,204 | |||||||||||||||||
Goodwill and intangible asset impairment | 28,368 | 0 | 26,439 | |||||||||||||||||
Restructuring expense | 1,212 | 2,322 | 2,585 | |||||||||||||||||
(Loss) income from operations | (14,318) | [4] | 20,786 | (8,858) | [4] | |||||||||||||||
Other income (expense): | ||||||||||||||||||||
Interest expense | (21,171) | (22,439) | (29,280) | [5] | ||||||||||||||||
Other, net | (352) | (236) | 223 | |||||||||||||||||
Total other expense | (21,523) | (22,675) | (29,057) | |||||||||||||||||
Loss before income taxes | (35,841) | (1,889) | (37,915) | |||||||||||||||||
(Benefit) provision for income taxes | (734) | 352 | (8,953) | |||||||||||||||||
Net loss | $ (3,757) | [1] | $ 309 | $ (29,900) | [6] | $ (1,759) | [7] | $ (1,188) | [2] | $ 34 | [3] | $ 378 | [8] | $ (1,465) | [9] | (35,107) | (2,241) | (28,962) | ||
Other comprehensive income (loss): | ||||||||||||||||||||
Change in foreign currency translation adjustment | (71) | (41) | (98) | |||||||||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings, net of tax of $0, $0 and $157 | 0 | 0 | 278 | |||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, $0 and $(157) | 278 | |||||||||||||||||||
Total comprehensive loss | $ (35,178) | $ (2,282) | $ (28,782) | |||||||||||||||||
Amounts per common share: | ||||||||||||||||||||
Net (loss) income per common share (in dollars per share) | $ (0.29) | $ 0.02 | $ (2.28) | $ (0.14) | $ (0.09) | $ 0 | $ 0.03 | $ (0.11) | $ (2.68) | $ (0.17) | $ (2.28) | |||||||||
Net (loss) income per common share assuming dilution (in dollars per share) | $ (0.29) | $ 0.02 | $ (2.28) | $ (0.14) | $ (0.09) | $ 0 | $ 0.03 | $ (0.11) | $ (2.68) | $ (0.17) | $ (2.28) | |||||||||
Weighted average common shares outstanding (in shares) | 13,113,901 | 12,869,353 | 12,716,976 | |||||||||||||||||
Weighted average dilutive common shares outstanding (in shares) | 13,113,901 | 12,869,353 | 12,716,976 | |||||||||||||||||
[1] | Gross profit in the fourth quarter of 2016 includes an unfavorable cumulative catch-up adjustment of $1,741 related to a long-term contract. | |||||||||||||||||||
[2] | Gross profit in the fourth quarter of 2015 includes an unfavorable cumulative catch-up adjustment of $1,010 related to a long-term contract. Net loss for the fourth quarter of 2015 also includes a restructuring benefit of $46. | |||||||||||||||||||
[3] | Gross profit in the third quarter of 2015 includes an unfavorable adjustment of $1,738 related to a long-term contract for which a forward loss reserve was established. Net income for the the third quarter of 2015 also included a net gain of $3,325 related to a legal settlement and $1,575 of restructuring expenses. | |||||||||||||||||||
[4] | Includes charges of $4,066 for intangible asset impairment and $24,302 for goodwill impairment in 2016. Includes charges of $26,439 for goodwill impairment in 2014. | |||||||||||||||||||
[5] | Includes $8,466 related to the write-off of deferred financing costs and $793 related to the settlement of debt derivatives associated with the Company's refinancing of its debt in 2014. | |||||||||||||||||||
[6] | Included in the net loss for the the second quarter of 2016 was a $28,368 charge for goodwill and intangible asset impairment related to the Engineering Services reporting unit and $241 of restructuring expenses. | |||||||||||||||||||
[7] | Included in the net loss for the the first quarter of 2016 were $947 of restructuring expenses. | |||||||||||||||||||
[8] | Included in the net income for the the second quarter of 2015 were $518 of restructuring expenses. | |||||||||||||||||||
[9] | Included in the net loss for the the first quarter of 2015 were $275 of restructuring expenses. |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-In Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
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) | 0 | 0 | 0 | (28,962) | 0 |
Other comprehensive income (loss) | 337 | 0 | 0 | 0 | 0 | 337 |
Issuance of stock | ||||||
Shares of restricted stock | (249) | 4 | (38) | (215) | 0 | 0 |
Stock Issued During Period, Value, Issued for Services | 167 | 0 | 109 | 58 | 0 | 0 |
401k plan contribution | 848 | 1 | 847 | 0 | 0 | 0 |
Restricted stock compensation | 1,850 | 0 | 1,850 | 0 | 0 | 0 |
Balance at Dec. 31, 2014 | 118,135 | 262 | 95,460 | (359) | 22,942 | (170) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (2,241) | 0 | 0 | 0 | (2,241) | 0 |
Other comprehensive income (loss) | (41) | 0 | 0 | 0 | 0 | (41) |
Issuance of stock | ||||||
Shares of restricted stock | (325) | 3 | (178) | (150) | 0 | 0 |
Stock Issued During Period, Value, Issued for Services | 84 | (7) | 91 | |||
401k plan contribution | 710 | 1 | 709 | 0 | 0 | 0 |
Restricted stock compensation | 1,633 | 0 | 1,633 | 0 | 0 | 0 |
Cumulative Effect on Retained Earnings, before Tax | 1 | 0 | 0 | 0 | 1 | 0 |
Balance at Dec. 31, 2015 | 117,956 | 266 | 97,617 | (418) | 20,702 | (211) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (35,107) | 0 | 0 | 0 | (35,107) | 0 |
Other comprehensive income (loss) | (71) | 0 | 0 | 0 | 0 | (71) |
Issuance of stock | ||||||
Shares of restricted stock | (190) | 4 | (612) | 418 | 0 | 0 |
401k plan contribution | 1,472 | 3 | 1,469 | 0 | 0 | 0 |
Restricted stock compensation | 1,481 | 0 | 1,481 | 0 | 0 | 0 |
Balance at Dec. 31, 2016 | $ 85,541 | $ 273 | $ 99,955 | $ 0 | $ (14,405) | $ (282) |
CONSOLIDATED STATEMENTS OF SHA6
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Stockholders' Equity [Abstract] | |||
Stock Issued During Period, Shares, Issued for Services | 0 | 6,791 | 12,175 |
Issuance of stock | |||
Shares of restricted stock (in shares) | 212,890 | 131,063 | 142,588 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating activities: | |||
Net loss | $ (35,107) | $ (2,241) | $ (28,962) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 19,043 | 20,404 | 22,459 |
Amortization of debt issuance cost | 1,899 | 1,961 | 2,155 |
Goodwill and intangible asset impairment | 28,368 | 0 | 26,439 |
Stock-based compensation | 1,481 | 1,717 | 2,018 |
Debt issuance cost write-off | 0 | 0 | 8,466 |
Payments to settle interest rate derivatives | 0 | 0 | (793) |
Deferred taxes | (723) | 78 | 76 |
Other non-cash items | (84) | (1,005) | 686 |
Changes in operating assets and liabilities, net of acquired businesses: | |||
Trade accounts receivable | (2,965) | 9,624 | 14,270 |
Inventories | (8,610) | (1,047) | (1,101) |
Prepaid expenses and other assets | 975 | 325 | 109 |
Current income taxes | 181 | 6,506 | (5,908) |
Accounts payable | 13,433 | (8,427) | 307 |
Accrued expenses | (3,340) | 4,467 | 8,896 |
Net cash provided by operating activities | 14,551 | 32,362 | 49,117 |
Investing activities: | |||
Additions to property, plant and equipment | (11,813) | (16,599) | (16,690) |
Proceeds from sale of equipment | 639 | 285 | 3,579 |
Net cash used by investing activities | (11,174) | (16,314) | (13,111) |
Financing activities: | |||
Proceeds from issuance of debt | 1,465 | 0 | 250,000 |
Principal payments on long-term debt and notes payable | (12,699) | (13,276) | (235,633) |
Advances on revolving line of credit | 60,000 | 99,000 | 66,000 |
Payments on revolving line of credit | (60,000) | (99,000) | (102,000) |
Debt issuance costs | (156) | (195) | (8,018) |
Net cash used by financing activities | (11,390) | (13,471) | (29,651) |
Net (decrease) increase in cash and cash equivalents | (8,013) | 2,577 | 6,355 |
Cash and cash equivalents, beginning of year | 10,504 | 7,927 | 1,572 |
Cash and cash equivalents, end of year | 2,491 | 10,504 | 7,927 |
Cash payments for: | |||
Interest paid | 18,657 | 21,336 | 7,388 |
Income tax refunds received, net | $ (228) | $ (6,370) | $ (3,037) |
ACCOUNTING POLICIES
ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2016 | |
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 year 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 represent of 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 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 revenue or cost are accounted for as a change in estimate. A cumulative catch-up adjustment is recorded in the period the change in estimated cost to complete the contract is determined. In addition, should total estimated costs at completion exceed the estimated total revenue, any anticipated loss is recognized in the period in which the anticipated loss is determined. The loss is reported either as a reduction of revenue or as a component of cost of sales. During 2016 and 2015, the Company recorded losses on a cost-to-cost program of $1,903 and $2,763 , respectively, which included provisions for anticipated future loss of $722 and $476 , respectively. 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 were 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: 2016 2015 2014 Favorable adjustments $ 1,342 $ 1,308 $ 5,720 Unfavorable adjustments (2,483 ) (2,954 ) (1,719 ) Net operating income adjustments $ (1,141 ) $ (1,646 ) $ 4,001 Unfavorable cumulative catch-up adjustments of $1,903 , $2,763 and $1,479 were recorded in 2016, 2015 and 2014, respectively, related to the Mitsubishi Regional Jet design build program which has experienced higher than expected development costs. A loss provision for this contract was established in 2015 and the contract remains in a loss position at December 31, 2016. The adjustments related to this program was recorded as a reduction to revenue in the Consolidated Statements of Comprehensive Income (Loss). Favorable adjustments recorded in 2014 are primarily associated with the aforementioned Valent contract of $5,267 . The adjustments related to this program was recorded as a reduction to cost of sales in the Consolidated Statements of Comprehensive Income (Loss). Contract accounting requires management to estimate contract revenues and costs, and make assumptions related to production schedule and total units to be produced, among other matters. Due to the size, length of time and nature of many of our contracts, the estimation of total sales and cost is very complicated and subject to many variables, including development program delays and the expected recovery of deferred cost. Claims and unpriced change orders can also 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. The Company's revenue recognized in 2016 contained $933 that represented amounts associated with claims and unpriced change orders. 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. Total contract cost estimates are largely based our current cost of production, purchase order terms negotiated or estimated by our supply chain. 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-Production Costs under Long-Term Supply Contracts 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. 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 40 years, 3 to 20 years and 3 to 10 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 based on future undiscounted cash flows 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 In December 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 to rent expense over the 18 year term of the leases on a straight-line basis. At December 31, 2016 and 2015, the unamortized deferred gain of $1,906 and $2,140 , respectively, was reflected in Accrued Expenses and Other Long-Term Liabilities in the Consolidated Balance Sheet. 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/loss 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 has remained in a cumulative loss position at December 31, 2016, 2015 and 2014. 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, 2016, 2015 and 2014, the Company's deferred tax assets remained 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, 2016 and 2015 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, 2016 . The Company has no material interest or penalties relating to income taxes recognized in the Consolidated Statement of Comprehensive Income (Loss) as of December 31, 2016 , 2015 or 2014. As of December 31, 2016 , returns for calendar 2015 remain subject to examination by the Internal Revenue Service and returns for 2013 through 2015 remain subject to examination by various state tax jurisdictions. 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. 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 new standard is effective for reporting periods beginning after December 15, 2017 and the Company plans to adopt the standard in the first quarter of 2018. The standard supersedes existing revenue recognition guidance, including industry-specific guidance, and provides 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. 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 adoption of the new standard may have a material impact on our income statement and balance sheet but we have not completed the quantification of that impact at this time. The Company performed a preliminary review of its significant contracts and have identified differences that would result from applying the new standard to those contracts. Based on this review, we currently expect that the timing of the recognition of revenue and related costs may change for a significant portion of our business. Some of our contracts on which we currently recognize revenue when risk of loss is transferred to the customer may recognize revenue as costs are incurred under the new standard. In addition, some long-term production contracts for which we currently recognize cost at an average expected margin over the life of the contract may recognize costs attributable to each individual unit as control is transferred to the customer. under the new standard. Adoption of the new standard will not change the total amount of revenue recognized on these contracts, only the timing of when revenue is recognized. These changes also have the potential to significantly alter the amount of deferred contract costs in inventory reported on our balance sheet. The Company is currently evaluating the transition method to be used and is implementing changes to business processes, systems and controls to support adoption of the standard. In February 2016, the FASB issued ASU 2016-02, "Leases." The standard requires lessees to recognize a lease liability and a lease asset for all leases, including operating leases, with a term greater than 12 months on its balance sheet. The new standard also expands the required quantitative and qualitative disclosures surrounding leases. The provisions of this new guidance are effective as of the beginning of the Company’s first quarter of 2019. This new standard will be applied using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the effect of this standard on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting," which amends Accounting Standards Codification (“ASC”) Topic 718, Compensation – Stock Compensation. The standard requires excess tax benefits or deficiencies for share-based payments be recorded in the period shares vest as income tax expense or benefit, rather than within Additional Paid-in Capital. Cash flows related to excess tax benefits will be included in operating activities and will no longer be separately classified as a financing activity. The new standard is effective for reporting periods beginning after December 15, 2016 and early adoption is permitted. The Company plans to adopt the new standard effective January 1, 2017 and no material impact on our financial statements is expected. In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments." The guidance addresses the classification of cash flow related to (1) debt prepayment or extinguishment costs, (2) settlement of zero-coupon debt instruments or other debt instruments with coupon rates that are insignificant in relation to the effective interest rate of the borrowing, (3) contingent consideration payments made after a business combination, (4) proceeds from the settlement of insurance claims, (5) proceeds from the settlement of corporate-owned life insurance, including bank-owned life insurance, (6) distributions received from equity method investees and (7) beneficial interests in securitization transactions. The guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The guidance will generally be applied retrospectively and is effective for financial statements issued for annual reporting periods beginning after December 15, 2017. Early application is permitted and the Company plans to adopt the new standard effective January 1, 2017. We are currently evaluating the impact of this standard on our consolidated statement of cash flows. All other issued but not yet effective accounting pronouncements are not expected to have a material impact on our Consolidated Financial Statements. |
ASSETS AND LIABILITIES MEASURED
ASSETS AND LIABILITIES MEASURED AT FAIR VALUE | 12 Months Ended |
Dec. 31, 2016 | |
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, 2016 . There were no transfers between levels during 2016 and 2015 . Assets and Liabilities at Fair Value 2016 as of December 31, 2016 Total Total (Level 1) (Level 2) (Level 3) Losses Non-recurring Fair Value Measurements: Asset: Intangible assets, net (1) $ 38,852 $ — $ — $ 38,852 $ (4,066 ) Goodwill (2) $ 62,482 $ — $ — $ 62,482 $ (24,302 ) (1) The fair values of intangibles relating to the acquisition of Valent was determined by third parties in connection with the purchase and recorded at those values. The intangibles relating to the Engineering Services reporting unit were deemed impaired during 2016 and a $4,066 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. (2) The Company performed its annual impairment analysis of goodwill related to the Aerostructures reporting units during the fourth quarter of 2016 and determined no adjustments to the carrying value were necessary. The value of the goodwill relating to the Engineering Services reporting unit was deemed impaired during 2016 and a $24,302 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. 2015 Assets and Liabilities at Fair Value Total as of December 31, 2015 Gains Total (Level 1) (Level 2) (Level 3) (Losses) Non-recurring Fair Value Measurements: Asset: Intangible assets, net (1) $ 46,582 $ — $ — $ 46,582 $ — Goodwill (2) $ 86,784 $ — $ — $ 86,784 $ — (1) The fair values of intangibles relating to the acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. (2) The Company performed its annual impairment analysis of goodwill during the fourth quarter of 2015 and determined no adjustments to the carrying value were necessary. |
ACCOUNTS RECEIVABLE NET
ACCOUNTS RECEIVABLE NET | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
ACCOUNTS RECEIVABLE NET | ACCOUNTS RECEIVABLE NET Accounts receivable, net consists of the following: December 31, 2016 2015 Trade receivables $ 44,927 $ 42,307 Unbilled revenue 4,318 4,869 Other receivables 2,372 1,561 51,617 48,737 Less: Allowance for doubtful accounts (348 ) (246 ) Accounts receivable, net $ 51,269 $ 48,491 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 which the Company expects to collect after December 31, 2017 are not material. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories consist of the following: December 31, 2016 2015 Raw materials $ 12,822 $ 12,513 Work in progress 23,795 22,681 Manufactured and purchased components 20,922 19,224 Finished goods 28,346 28,169 Product inventory 85,885 82,587 Capitalized contract costs 36,876 32,188 Total inventories $ 122,761 $ 114,775 Capitalized contract costs include $5,373 and $5,970 at December 31, 2016 and 2015, respectively, related to an agreement the Company signed with Spirit Aerostructures ("Spirit"). This agreement extended the performance period of the statements of work for certain contracts with Spirit and gave the Company preferred supplier status on certain future contracts. In accordance with the contract terms, the Company made $6,500 in cash payments of consideration to Spirit in 2015 which was recorded as an increase to capitalized contract costs in inventory in the Consolidated Balance Sheet. This consideration is being amortized as a reduction to revenue over the life of the related contracts. The increase in capitalized contract costs in 2016 relates primarily to four early-stage long-term contracts. The Company expects these costs will not be realized within one year but believes these amounts will be fully recovered over the life of the related contracts. The following table illustrates the market to which capitalized contract cost at December 31, 2016 and December 31, 2015 related: December 31, 2016 2015 Large commercial aircraft $ 10,852 $ 11,528 Corporate and regional aircraft 21,081 16,721 Military 4,943 3,939 Total capitalized contract cost $ 36,876 $ 32,188 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. At December 31, 2016 and 2015, the Company had no contracts with loss reserves accounted for as a reduction of inventory. |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2016 | |
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 $14,755 , $15,494 and $17,934 for 2016 , 2015 and 2014 , respectively. December 31, 2016 2015 Land $ 960 $ 1,108 Buildings and improvements 27,567 27,779 Machinery and equipment 137,899 129,222 Leasehold improvements 13,748 13,373 Software and other 8,510 8,507 Construction in progress 13,569 11,687 Total gross property, plant and equipment 202,253 191,676 Less accumulated depreciation (102,738 ) (90,707 ) Total net property, plant and equipment $ 99,515 $ 100,969 See discussion in Note 8 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, 2016 | |
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, 2016 and 2015 , respectively: Engineering Aerostructures Services Total 2016 2015 2016 2015 2016 2015 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 ) (50,741 ) (26,439 ) (130,212 ) (105,910 ) Net Goodwill $ 62,482 $ 62,482 $ — $ 24,302 $ 62,482 $ 86,784 The net goodwill balance in the Aerostructures segment is related to the acquisitions of Valent and Intec, which account for $56,288 and $6,194 , respectively, at both December 31, 2016 and 2015 . The annual impairment analysis performed in the fourth quarter of 2016 determined that the fair value for the goodwill in Aerostructures exceeded its carrying value. In the second quarter of 2016, a triggering event occurred when the Company significantly downgraded the full-year 2016 sales and operating income forecast for its Engineering Services business due to continued decline in demand. This downward adjustment to the forecast, combined with lower than expected operating results for the second quarter of 2016, was deemed to be a triggering event requiring an interim impairment evaluation for the Engineering Services reporting unit in accordance with ASC 350. An impairment analysis was performed and determined that the carrying value of related goodwill was fully impaired. As a result, a non-cash impairment charge of $24,302 was recorded in the second quarter of 2016, which brought the goodwill associated with the reporting unit to $0 . 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 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. Of the gross goodwill recorded by the Company, 26.3% is not 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 trademarks resulted from the acquisitions of Intec, TASS, and Valent are fully amortized at December 31, 2016 . Customer intangibles have a remaining weighted average useful life of 15.9 years and other intangible assets have a remaining weighted average useful life of 2.1 years . The carrying values were as follows: December 31, 2016 2015 Trademarks $ 778 $ 778 Customer intangible assets 68,991 68,991 Other 1,274 1,274 Accumulated amortization (32,191 ) (24,461 ) Intangible assets, net $ 38,852 $ 46,582 The aforementioned triggering event within the Engineering Services reporting unit related to goodwill also resulted an impairment charge of $4,066 related to customer intangible assets in 2016. Intangibles amortization expense for 2016 , 2015 and 2014 was $3,664 , $4,359 and $4,524 , respectively. The estimated annual amortization expense for intangible assets is as follows: Year ending December 31, 2017 $ 3,087 2018 2,854 2019 2,627 2020 2,531 2021 2,482 Thereafter 25,271 $ 38,852 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | ACCRUED EXPENSES Accrued expenses consist of the following: December 31, 2016 2015 Accrued interest $ 7,792 $ 8,020 Receipts in excess of cost on long-term production contracts 4,782 5,097 Accrued payroll 2,367 2,481 Accrued bonus 570 3,698 Accrued vacation 1,886 1,913 Accrued employee benefits 2,863 3,075 Accrued operating lease obligations 2,350 2,475 Accrued professional fees 767 1,104 Accrued restructuring 285 255 Other 1,881 1,897 Total accrued expenses $ 25,543 $ 30,015 |
LONG-TERM DEBT AND CAPITAL LEAS
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS Long Term Debt and Capital Lease Obligations (Notes) | 12 Months Ended |
Dec. 31, 2016 | |
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, 2016 2015 Second priority senior secured notes at a fixed rate of 7.375% at December 31, 2016 and December 31, 2015 $ 224,175 $ 234,175 Missouri IRBs at fixed rate of 2.80% at December 31, 2016 and December 31, 2015 6,456 6,901 Capital Leases, at fixed rates ranging from 3.00% to 4.50% at December 31, 2016 and 3.00% to 7.73% at December 31, 2015 10,293 11,708 Notes payable, principal and interest payable monthly, at fixed rates, from 2.45% to 5.00% at December 31, 2016 and from 2.45% to 2.56% at December 31, 2015 2,377 1,750 Debt issuance cost (3,248 ) (4,539 ) Total debt 240,053 249,995 Less current installments 2,655 2,362 Total long-term debt and capital lease obligations $ 237,398 $ 247,633 On June 19, 2014, the Company issued $250,000 in second-priority senior secured notes maturing on July 15, 2019. The Company recorded these notes at cost. The estimated fair value of these notes, based on the last market price transaction in the year ended December 31, 2016 of 1.0075, was $225,856 . During 2014, 2015, and 2016 the Company repurchased and retired $5,000 , $10,825 , and $10,000 respectively, of the outstanding notes at a premium of 1.125% , 0.0% , and 1.875% respectively, 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. In addition, on June 19, 2014, the Company modified its revolving credit agreement. The modified agreement 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, 2016 , the reserve established was $15,000 , which reduced the maximum availability to $75,000 . Based on the amount of eligible assets at December 31, 2016 and considering outstanding letters of credit of $1,525 , available borrowings were further reduced to $49,728 . 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, 2016 , the average debt outstanding on the revolving credit facility was $164 which accrued interest at an average rate of 5.80% . No amounts were outstanding on the revolving credit facility at December 31, 2016 or December 31, 2015. 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, 2016 , the commitment fee required was 0.5% . The revolving credit loan facility matures on the earlier of the fifth year anniversary date, July 15, 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, 2016 , the Company was in compliance with all of its covenants and expects 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 4.50% and mature between September 2020 and June 2032 . In addition, the Company's debt at December 31, 2015 includes a capital lease of $232 related to the building in Coweta, Oklahoma. This capital lease was settled in cash in January of 2016. In 2015, a debt of the Company of $1,167 was assumed by a third-party as the result of a lawsuit settlement. 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 5.00% through February 2023. The gross amount of assets recorded under capital leases totaled $14,558 as of December 31, 2016 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 2017 $ 1,061 $ 1,915 2018 1,094 2,176 2019 225,183 2,450 2020 5,211 2,304 2021 177 1,208 Thereafter 282 1,554 Total 233,008 11,607 Less: imputed interest — (1,314 ) Total $ 233,008 $ 10,293 (1) Includes principal only Debt issuance costs of $8,348 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. The Company has appropriately split the deferred financing fees incurred in connection with its debt and will amortize the fees over their respective terms. As the Company repurchases and retires second-priority senior secured notes, the associated unamortized debt issuance costs are written-off and amortized as interest expense. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2016 | |
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 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 Consolidated Balance Sheet at December 31, 2016, 2015 or 2014. 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 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 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 years ended December 31, 2016 , December 31, 2015 and December 31, 2014: Net of Tax Derivatives in Cash Flow Hedging Relationship Effective portion of (Gain) Loss Recognized in AOCI on Derivative Effective Portion of (Gain) Loss Reclassified from AOCI into Earnings Year ended December 31, 2016 Interest rate derivatives $ — $ — Year ended December 31, 2015 Interest rate derivatives $ — $ — Year ended December 31, 2014 Interest rate derivatives $ — $ 278 |
(LOSS) EARNINGS PER COMMON SHAR
(LOSS) EARNINGS PER COMMON SHARE | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
EARNINGS PER COMMON SHARE | (LOSS) 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 treasury stock method. The following table shows a reconciliation of the numerators and denominators used in calculating basic and diluted earnings per share. Year ended December 31, 2016 2015 2014 Numerators Net loss $ (35,107 ) $ (2,241 ) $ (28,962 ) Denominators Weighted average common shares - basic 13,113,901 12,869,353 12,716,976 Dilutive effect of restricted stock — — — Weighted average common shares - diluted 13,113,901 12,869,353 12,716,976 Basic earnings per share $ (2.68 ) $ (0.17 ) $ (2.28 ) Diluted earnings per share $ (2.68 ) $ (0.17 ) $ (2.28 ) For the twelve months ended December 31, 2016 , December 31, 2015 and December 31, 2014 , 94,408 , 159,875 and 153,249 shares, respectively, 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, 2016 | |
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, 2016 , the future minimum lease payments under operating leases with initial non-cancelable terms in excess of one year are as follows: 2017 $ 7,636 2018 7,255 2019 5,872 2020 5,057 2021 4,704 Thereafter 10,245 Total $ 40,769 Rent expense totaled $7,479 , $7,753 and $8,396 in 2016 , 2015 and 2014 , respectively. The Company has entered into employment agreements with certain members of senior management, the terms of which expire on December 31, 2019. The terms of these agreements include non-compete and non-disclosure provisions, and provide for defined severance payments in the event of termination without cause and termination or resignation with good reason following a change in control. Legal Contingencies The Company has been named as a defendant in certain pending lawsuits in the normal course of business (the “Pending Lawsuits”). In the opinion of management, after consulting with legal counsel, the losses, if any, resulting from the Pending Lawsuits is not expected to have a material effect on the Company’s future financial position, results of operations or cash flows. In the quarter ended June 30, 2015, Ozark Mountain Technologies, LLC, a wholly-owned subsidiary of the Company (“OMT”), settled allegations of low pH wastewater releases by its facility between 2009 and 2013. As part of a plea agreement, OMT pled guilty to one count of negligently violating the Clean Water Act and paid a criminal fine of $694 . In the quarter ended June 30, 2015, OMT settled allegations made by the Attorney General of the State of Missouri of pollution of state waters, violation of pretreatment regulations and violation of water quality standards claimed to have occurred in 2011 and in July 2015, paid civil penalties of $175 . The fine and civil penalties paid in connection with both settlements were equal to the loss contingencies recorded by the Company at December 31, 2014. In the third quarter of 2015, the Company resolved a lawsuit (the “Tech Lawsuit”) filed by the former owners of Valent Aerostructures, LLC (“Valent”) and affiliates of such owners (collectively, “Tech Investments”) against the Company for declaratory judgment on various matters resulting from the acquisition of Valent by the Company in December 2012, including the environmental charges against OMT. On November 5, 2015, the parties to the Tech Lawsuit executed the definitive settlement documents. As a result of the settlement: (a) the Tech Lawsuit was dismissed with prejudice on January 12, 2016, (b) $3,109 of the funds that remained in escrow from the sale were disbursed to the Company and the remaining amount of escrow funds was retained by Tech Investments, (c) Tech Investments assumed an approximate $1,167 payment obligation of the Company to a predecessor owner of OMT that remained under a purchase agreement the Company acquired as part of the Company’s acquisition of Valent; (d) locked-up shares representing partial consideration for the purchase price paid by the Company were released to Tech Investments; and (e) all parties entered into a mutual release of certain claims and disputes. The settlement also resulted in the Company assuming other liabilities of $500, collecting a previously recorded receivable of $389 and recording other expenses of $40. The net impact of the settlement resulted in a gain of $3,347 which is recorded in selling, general and administrative expenses in the accompanying Consolidated Statements of Operations, for the year ended December 31, 2015. |
DEFINED CONTRIBUTIONS PLANS
DEFINED CONTRIBUTIONS PLANS | 12 Months Ended |
Dec. 31, 2016 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
DEFINED CONTRIBUTIONS PLANS | DEFINED CONTRIBUTION PLANS The Company sponsors the LMI Profit Sharing and Savings Plan (the "Plan"), which covers virtually all of its employees. The Plan includes both 401(k) and profit sharing components under which the Company may make discretionary contributions. The Company’s contributions to the Plan are determined and approved by the Board of Directors and may be settled in cash or shares of LMI common stock. In 2016 , 2015 , and 2014 , Company contributions under the Plan were made in stock. Matching contributions under the 401(k) component of the Plan are based upon a percentage of employee contributions. For the years ended December 31, 2016 and 2015, the Company made 401(k) contributions up to a maximum of 3.0% or 5.0% of eligible annual wages per employee. The applicable percent of eligible wages for each participant was determined by the operating segment to which the employee belonged. Matching contributions to the Plan made in 2016 and 2015 are vested to the employee over four years at 25% per annum. For the year ended December 31, 2014 , 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. Matching contributions made in 2014 were immediately vested. Profit sharing contributions made by the Company vest over time and are fully vested after six years. No profit sharing contributions were made in 2016 , 2015 , or 2014 . The Company recognized costs for 401(k) matching contributions under the Plan totaling $1,451 , $1,519 , and $729 in 2016 , 2015 , and 2014 , respectively. At December 31, 2014, the Company also sponsored the Valent 401(k) plan (the "Valent Plan.") The Valent Plan was merged into the Plan effective June 4, 2015 and was subsequently terminated. Under the Valent Plan, the Company could contribute a discretionary matching contribution. The exact percentage, if any, was determined each year and could not exceed 3.0% of a participant’s compensation for the year. During 2014, the Company recognized expense under the Valent Plan of $848 , equating to 100% of the first 3.0% of participant compensation. |
STOCK BASED COMPENSATION
STOCK BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2016 | |
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 “2005 Plan”). The 2005 Plan provided 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 issued under the 2005 Plant are subject to a time-based vesting schedule. As of July 7, 2015 the Company was no longer able to grant awards under the 2005 Plan. All outstanding share-based grants are in the form of restricted stock. A summary of the activity for non-vested awards under the 2005 Plan is presented below: 2016 Restricted Stock Awards Shares Weighted Average Grant Date Fair Value Outstanding at January 1 253,434 $ 14.54 Granted — — Vested (53,846 ) 17.89 Forfeited (31,038 ) 14.19 Outstanding at December 31 168,550 $ 13.53 Stock compensation expense related to awards granted under the 2005 Plan was $485 , $1,284 and $1,850 for the years ended December 31, 2016 , 2015 and 2014 , respectively. Total unrecognized compensation costs related to non-vested share-based awards granted under the 2005 Plan were $513 and $1,762 as of December 31, 2016 and December 31, 2015 , respectively. These costs were expected to be recognized over a weighted average period of 1.2 and 1.6 years as of December 31, 2016 and 2015 , respectively. The fair value of awards that vested during the years ended December 31, 2016 , 2015 and 2014 , based on the market price on vesting date, was $527 , $1,559 and $1,083 , respectively. On June 24, 2015, the Company's shareholders approved the LMI Aerospace, Inc. 2015 Incentive Compensation Plan (the “2015 Plan”), which became effective on July 1, 2015. Under the 2015 Plan, the Company, through the Compensation Committee of the Board of Directors, may, at its discretion, grant stock options, restricted shares of common stock, and other various stock-based awards to directors, officers, employees and consultants. A total of 750,000 shares of the Company’s common stock have been reserved for issuance under the 2015 Plan. All outstanding share-based grants are in the form of restricted stock. A summary of the activity for non-vested awards under the 2015 Plan is presented below: 2016 Restricted Stock Awards Shares Weighted Average Grant Date Fair Value Outstanding at January 1 61,801 $ 9.79 Granted 277,552 8.50 Vested (1) (55,672 ) 9.79 Forfeited (9,553 ) 9.43 Outstanding at December 31 274,128 $ 8.46 (1) Excludes 6,129 shares for which service requirements are met that remain subject to deferral at December 31, 2016 pursuant to the LMI Aerospace, Inc. Non-Qualified Deferred Compensation Plan for Senior Executives and Outside Directors. Compensation expense related to awards granted under the 2015 Plan was $992 and $303 for the years ended December 31, 2016 and 2015, respectively. Total unrecognized compensation costs related to non-vested share-based awards granted under the 2015 Plan were $1,510 and $303 as of December 31, 2016 and 2015, respectively. These costs were expected to be recognized over a weighted average period of 1.8 and 0.5 years as of December 31, 2016 and 2015, respectively. The fair value of awards that vested during the years ended December 31, 2016 and 2015 , based on the market price on vesting date, was $528 and $0 , respectively. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Net deferred tax (liabilities)/assets at December 31, were as follows: December 31, 2016 2015 Deferred tax assets $ 42,336 $ 35,730 Deferred tax liabilities (21,309 ) (21,625 ) Valuation allowance (21,027 ) (14,641 ) Net deferred tax liabilities $ — $ (536 ) 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 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, 2016 2015 Goodwill and intangible assets $ 13,812 $ 13,267 Inventories 2,658 2,569 NOL carry forwards 17,808 10,529 Tax credit carry forwards 2,904 2,354 Stock award 819 827 Gain on sale of real estate 698 783 Obligation under operating leases 822 835 Accrued vacation 504 504 Accrued bonus 64 649 Other 710 426 Long-term contract costs (13,496 ) (11,781 ) Depreciation (6,276 ) (6,857 ) Valuation allowance (21,027 ) (14,641 ) Net deferred tax liabilities $ — $ (536 ) The Company’s income tax (benefit) provision attributable to income before taxes consisted of the following for the years ended December 31, 2016 , 2015 and 2014 . 2016 2015 2014 Federal: Current $ (24 ) $ 304 $ (9,173 ) Deferred (676 ) (14 ) 155 (700 ) 290 (9,018 ) State: Current (11 ) 55 21 Deferred (23 ) 7 44 (34 ) 62 65 (Benefit) provision for income taxes $ (734 ) $ 352 $ (8,953 ) 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 collected an income tax receivable of $6,527 in the fourth quarter of 2015 related to this carry back. The reconciliation of income tax provision (benefit) computed at the U.S. federal statutory tax rates to income tax (benefit) provision is presented below: 2016 2015 2014 Federal tax benefit $ (12,544 ) $ (661 ) $ (13,270 ) State and local taxes, net of federal benefit (464 ) (114 ) 358 Non-deductible goodwill impairment 6,296 — 9,254 Valuation allowance 6,386 1,809 (5,294 ) Tax audit adjustment (24 ) 306 — Research and experimental and other tax credits (550 ) (1,174 ) (503 ) Other 166 186 502 (Benefit) provision for income taxes $ (734 ) $ 352 $ (8,953 ) At December 31, 2016 , the Company had federal and state net operating loss and tax credit carry forwards with values of $17,044 and $3,668 , respectively. The federal net operating losses begin to expire in the year 2034 and the state net operating losses expire in the years 2023 through 2035. |
RESTRUCTURING
RESTRUCTURING | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | RESTRUCTURING The Company committed to and implemented various restructuring plans in 2014, 2015 and 2016. Included in those plans were the the relocation of the machining operations in Savannah, Georgia and St. Charles, Missouri, and the relocation of the sheet-metal fabrication operation in Wichita, Kansas to other facilities within the Company. In addition, the Company closed its Melbourne, Australia and Greenville, South Carolina engineering offices, eliminated additional management positions within the Engineering Services segment and closed its Coweta, Oklahoma and Fort Worth, Texas manufacturing facilities. Other employment separation activities, which were primarily severance related, were also implemented as part of the Company's overall reorganization and cost reduction initiatives. The expense associated with these plans was reflected in the selling, general, and administrative section on a separate line of the Condensed Consolidated Statements of Comprehensive Income (Loss). The following table summarizes the incurred charges associated with these restructuring activities: Year ended December 31, 2016 2015 2014 Fort Worth facility closure $ — $ — $ 287 Savannah machining operations relocation — — 47 St. Charles machine parts operations relocation — 150 228 Coweta machining facility closure — 94 — Greenville office closure (26 ) 449 — Australia office closure — 47 — Wichita sheet metal fabrication operations relocation 265 — — Other employment separation activities 973 1,582 2,023 Total $ 1,212 $ 2,322 $ 2,585 Expense incurred by segment: Aerostructures $ 1,218 $ 1,108 $ 2,074 Engineering Services (6 ) 1,214 511 Total $ 1,212 $ 2,322 $ 2,585 The Company expects to incur no additional expenses associated with the above restructuring activities. In addition to the expenses detailed in the table above, the Company incurred additional project expenses of $295 , $1,265 and $1,361 in the years ended December 31, 2016 , 2015 and 2014 , respectively, related to the integration of work affected by these restructuring plans and accelerated depreciation of assets disposed of at affected facilities. Cash payments associated with these restructuring plans of $1,182 , $2,806 and $2,268 were made in the years ended December 31, 2016 , 2015 and 2014 , respectively. Employee Severance Other Total Accrued restructuring balance as of December 31, 2014 $ 739 $ — $ 739 Accrual additions 2,194 128 2,322 Cash payments (2,771 ) (35 ) (2,806 ) Accrued restructuring balance as of December 31, 2015 $ 162 $ 93 $ 255 Accrual additions 1,238 (26 ) 1,212 Cash payments (1,115 ) (67 ) (1,182 ) Accrued restructuring balance as of December 31, 2016 $ 285 $ — $ 285 Accrued restructuring of $285 at December 31, 2016 is expected to be paid in the first quarter of 2017. |
CUSTOMER AND SUPPLIER CONCENTRA
CUSTOMER AND SUPPLIER CONCENTRATION | 12 Months Ended |
Dec. 31, 2016 | |
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 38.4% , 11.7% and 11.2% of our total revenues in 2016 , respectively. These revenues are reported by both the Aerostructures and Engineering Services segments. Accounts receivable balances related to these customers were 31.8% , 12.3% , and 8.5% , of the accounts receivable balance at December 31, 2016 , respectively. Direct sales to our top three customers, Spirit AeroSystems , Gulfstream Aerospace Corporation and The Boeing Company , accounted for 34.7% , 14.2% and 11.6% of our total revenues in 2015 , respectively. These revenues are reported by both the Aerostructures and Engineering Services segments. Accounts receivable balances related to these customers were 28.6% , 15.5% and 10.2% of the accounts receivable balance at December 31, 2015 , respectively. 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% , 13.1% and 7.4% of the accounts receivable balance at December 31, 2014 , respectively. The Company did not have any sales to a foreign country greater than 10% of its total sales in 2016 , 2015 and 2014 . 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 2016 , 2015 and 2014 . The Company purchased approximately 45.5% , 45.9% and 49.6% of the raw materials and procured parts from its largest six suppliers in 2016 , 2015 , and 2014 , respectively. |
BUSINESS SEGMENT INFORMATION
BUSINESS SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2016 | |
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, with the exception of interest expense and income taxes, primarily support the Aerostructures segment. The table below presents information by segment on the same basis used within the Company to evaluate segment performance: December 31, 2016 2015 2014 Net sales: Aerostructures $ 311,131 $ 327,230 $ 326,025 Engineering Services 36,301 49,096 63,404 Eliminations (1,252 ) (1,230 ) (1,612 ) $ 346,180 $ 375,096 $ 387,817 Gross profit: Aerostructures $ 56,774 $ 63,584 $ 67,042 Engineering Services 3,372 5,286 8,428 Eliminations (343 ) (84 ) (100 ) $ 59,803 $ 68,786 $ 75,370 (Loss) income from operations: Aerostructures $ 16,153 $ 23,993 $ 18,977 Engineering Services (1) (30,128 ) (3,123 ) (27,731 ) Eliminations (343 ) (84 ) (104 ) $ (14,318 ) $ 20,786 $ (8,858 ) Depreciation, amortization and certain other non-cash charges (credits): Aerostructures $ 18,069 $ 18,551 $ 20,223 Engineering Services (1) 29,342 1,853 28,675 $ 47,411 $ 20,404 $ 48,898 (1) Includes charges of $4,066 for intangible asset impairment and $24,302 for goodwill impairment in 2016. Includes charges of $26,439 for goodwill impairment in 2014. December 31, 2016 2015 2014 Interest expense: Aerostructures $ 807 $ 957 $ 1,041 Engineering Services 33 43 41 Corporate (1) 20,331 21,439 28,198 $ 21,171 $ 22,439 $ 29,280 (1) Includes $8,466 related to the write-off of deferred financing costs and $793 related to the settlement of debt derivatives associated with the Company's refinancing of its debt in 2014. December 31, 2016 2015 2014 Capital expenditures: Aerostructures $ 11,748 $ 16,348 $ 16,504 Engineering Services 65 251 186 $ 11,813 $ 16,599 $ 16,690 December 31, 2016 2015 Total assets: Aerostructures $ 377,214 $ 379,873 Engineering 6,418 36,107 $ 383,632 $ 415,980 |
QUARTERLY FINANCIAL DATA (UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2016 | |
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 each quarter may not equal earnings per share for the year. 2016 First (1) Second (2) Third Fourth (3) Net sales $ 87,331 $ 83,993 $ 89,673 $ 85,183 Gross profit (3) $ 16,230 $ 15,535 $ 15,846 $ 12,192 Net (loss) income (1,2,3) $ (1,759 ) $ (29,900 ) $ 309 $ (3,757 ) Amounts per common share: Net (loss) income $ (0.14 ) $ (2.28 ) $ 0.02 $ (0.29 ) Net (loss) income - assuming dilution $ (0.14 ) $ (2.28 ) $ 0.02 $ (0.29 ) 2015 First (4) Second (5) Third (6) Fourth (7) Net sales $ 92,475 $ 97,550 $ 95,633 $ 89,438 Gross profit (6,7) $ 17,197 $ 18,770 $ 16,626 $ 16,193 Net (loss) income (4,5,6,7) $ (1,465 ) $ 378 $ 34 $ (1,188 ) Amounts per common share: Net (loss) income $ (0.11 ) $ 0.03 $ — $ (0.09 ) Net (loss) income - assuming dilution $ (0.11 ) $ 0.03 $ — $ (0.09 ) (1) Included in the net loss for the the first quarter of 2016 were $947 of restructuring expenses. (2) Included in the net loss for the the second quarter of 2016 was a $28,368 charge for goodwill and intangible asset impairment related to the Engineering Services reporting unit and $241 of restructuring expenses. (3) Gross profit in the fourth quarter of 2016 includes an unfavorable cumulative catch-up adjustment of $1,741 related to a long-term contract. (4) Included in the net loss for the the first quarter of 2015 were $275 of restructuring expenses. (5) Included in the net income for the the second quarter of 2015 were $518 of restructuring expenses. (6) Gross profit in the third quarter of 2015 includes an unfavorable adjustment of $1,738 related to a long-term contract for which a forward loss reserve was established. Net income for the the third quarter of 2015 also included a net gain of $3,325 related to a legal settlement and $1,575 of restructuring expenses. (7) Gross profit in the fourth quarter of 2015 includes an unfavorable cumulative catch-up adjustment of $1,010 related to a long-term contract. Net loss for the fourth quarter of 2015 also includes a restructuring benefit of $46 . |
CONDENSED CONSOLIDATING FINANCI
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (Notes) | 12 Months Ended |
Dec. 31, 2016 | |
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 July 15, 2019 (the “Notes”). The payment obligations of LMIA under the Notes are guaranteed and secured by LMIA and all of its subsidiaries other than minor 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 minor 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”) rules governing reporting on guarantor 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 December 31, 2016 (Amounts in thousands) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Assets Current assets: Cash and cash equivalents $ 2,382 $ 109 $ — $ 2,491 Trade accounts receivable, net 660 50,609 — 51,269 Intercompany receivables 244,792 312,332 (557,124 ) — Inventories — 122,761 — 122,761 Prepaid expenses and other current assets 1,548 2,038 — 3,586 Total current assets 249,382 487,849 (557,124 ) 180,107 Property, plant and equipment, net 6,490 93,025 — 99,515 Investments in subsidiaries 375,738 — (375,738 ) — Goodwill — 62,482 — 62,482 Intangible assets, net — 38,852 — 38,852 Other assets 1,790 886 — 2,676 Total assets $ 633,400 $ 683,094 $ (932,862 ) $ 383,632 Liabilities and shareholders’ equity Current liabilities: Accounts payable $ 410 $ 28,968 $ — $ 29,378 Accrued expenses 13,912 11,631 — 25,543 Intercompany Payables 310,644 246,480 (557,124 ) — Current installments of long-term debt and capital lease obligations 89 2,566 — 2,655 Total current liabilities 325,055 289,645 (557,124 ) 57,576 Long-term debt and capital lease obligations, less current installments 221,101 16,297 — 237,398 Other long-term liabilities 1,703 1,414 — 3,117 Total long-term liabilities 222,804 17,711 — 240,515 Total shareholders’ equity 85,541 375,738 (375,738 ) 85,541 Total liabilities and shareholders’ equity $ 633,400 $ 683,094 $ (932,862 ) $ 383,632 CONDENSED CONSOLIDATING BALANCE SHEET December 31, 2015 (Amounts in thousands) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Assets Current assets: Cash and cash equivalents $ 10,251 $ 253 $ — $ 10,504 Trade accounts receivable, net 1,220 47,271 — 48,491 Intercompany receivables 196,496 203,128 (399,624 ) — Inventories — 114,775 — 114,775 Prepaid expenses and other current assets 2,224 1,923 — 4,147 Total current assets 210,191 367,350 (399,624 ) 177,917 Property, plant and equipment, net 5,430 95,539 — 100,969 Investments in subsidiaries 387,868 — (387,868 ) — Goodwill — 86,784 — 86,784 Intangible assets, net — 46,582 — 46,582 Other assets 2,135 1,593 — 3,728 Total assets $ 605,624 $ 597,848 $ (787,492 ) $ 415,980 Liabilities and shareholders’ equity Current liabilities: Accounts payable $ 1,393 $ 11,763 $ — $ 13,156 Accrued expenses 17,009 13,006 — 30,015 Intercompany Payables 237,548 162,076 (399,624 ) — Current installments of long-term debt and capital lease obligations 85 2,277 — 2,362 Total current liabilities 256,035 189,122 (399,624 ) 45,533 Long-term debt and capital lease obligations, less current installments 229,752 17,881 — 247,633 Other long-term liabilities 1,881 2,441 — 4,322 Deferred income taxes — 536 — 536 Total long-term liabilities 231,633 20,858 — 252,491 Total shareholders’ equity 117,956 387,868 (387,868 ) 117,956 Total liabilities and shareholders’ equity $ 605,624 $ 597,848 $ (787,492 ) $ 415,980 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) December 31, 2016 (Amounts in thousands, except share and per share data) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Sales and service revenue Product sales $ (170 ) $ 307,954 $ 305 $ 308,089 Service revenues 40,864 38,217 (40,990 ) 38,091 Net sales 40,694 346,171 (40,685 ) 346,180 Cost of sales and service revenue Cost of product sales 86 248,836 305 249,227 Cost of service revenues 42,749 35,391 (40,990 ) 37,150 Cost of sales 42,835 284,227 (40,685 ) 286,377 Gross profit (2,141 ) 61,944 — 59,803 Selling, general and administrative expenses — 44,541 — 44,541 Restructuring expense 431 781 — 1,212 Goodwill and intangible asset impairment — 28,368 — 28,368 Loss from operations (2,572 ) (11,746 ) — (14,318 ) Other income (expense): Interest expense (20,336 ) (835 ) — (21,171 ) Other, net 5 (357 ) — (352 ) (Loss) income from equity investments in subsidiaries (12,275 ) — 12,275 — Total other (expense) income (32,606 ) (1,192 ) 12,275 (21,523 ) (Loss) income before income taxes (35,178 ) (12,938 ) 12,275 (35,841 ) Benefit for income taxes — (734 ) — (734 ) Net (loss) income (35,178 ) (12,204 ) 12,275 (35,107 ) Other comprehensive (loss) income: Change in foreign currency translation adjustment — (71 ) — (71 ) Total comprehensive (loss) income $ (35,178 ) (12,275 ) $ 12,275 $ (35,178 ) CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) December 31, 2015 (Amounts in thousands, except share and per share data) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Sales and service revenue Product sales $ 239 $ 323,337 $ 35 $ 323,611 Service revenues 36,184 51,720 (36,419 ) 51,485 Net sales 36,423 375,057 (36,384 ) 375,096 Cost of sales and service revenue Cost of product sales 248 259,327 35 259,610 Cost of service revenues 35,952 47,166 (36,418 ) 46,700 Cost of sales 36,200 306,493 (36,383 ) 306,310 Gross profit 223 68,564 (1 ) 68,786 Selling, general and administrative expenses — 45,678 — 45,678 Restructuring expense 340 1,982 — 2,322 (Loss) income from operations (117 ) 20,904 (1 ) 20,786 Other income (expense): Interest expense (21,449 ) (990 ) — (22,439 ) Other, net — (236 ) — (236 ) Income (loss) from equity investments in subsidiaries 19,284 — (19,284 ) — Total other expense (2,165 ) (1,226 ) (19,284 ) (22,675 ) (Loss) income before income taxes (2,282 ) 19,678 (19,285 ) (1,889 ) Provision for income taxes — 352 — 352 Net (loss) income (2,282 ) 19,326 (19,285 ) (2,241 ) Other comprehensive (loss) income: Change in foreign currency translation adjustment — (41 ) — (41 ) Total comprehensive (loss) income $ (2,282 ) $ 19,285 $ (19,285 ) $ (2,282 ) CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) December 31, 2014 (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 Restructuring expense 1,012 1,573 — 2,585 Loss from operations (1,854 ) (7,003 ) (1 ) (8,858 ) Other (expense) income: Interest expense (28,224 ) (1,056 ) — (29,280 ) Other, net 11 212 — 223 (Loss) income from equity investments in subsidiaries (8,860 ) — 8,860 — Total other (expense) income (37,073 ) (844 ) 8,860 (29,057 ) (Loss) income before income taxes (38,927 ) (7,847 ) 8,859 (37,915 ) (Benefit) provision for income taxes (9,867 ) 914 — (8,953 ) Net (loss) income (29,060 ) (8,761 ) 8,859 (28,962 ) Other comprehensive (loss) income: Change in foreign currency translation adjustment — (98 ) — (98 ) Reclassification adjustment for losses on interest rate hedges included in net earnings 278 — — 278 Total comprehensive (loss) income $ (28,782 ) $ (8,859 ) $ 8,859 $ (28,782 ) CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year ended December 31, 2016 (Amounts in thousands) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Operating activities: Net (loss) income $ (35,178 ) $ (12,204 ) $ 12,275 $ (35,107 ) Adjustments for non-cash items 16,955 45,304 (12,275 ) 49,984 Net changes in operating assets and liabilities, net of acquired businesses (1,566 ) 1,240 — (326 ) Intercompany activity 24,800 (24,800 ) — — Net cash provided by operating activities 5,011 9,540 — 14,551 Investing activities: Additions to property, plant and equipment (2,639 ) (9,174 ) — (11,813 ) Proceeds from sale of equipment — 639 — 639 Net cash used by investing activities (2,639 ) (8,535 ) — (11,174 ) Financing activities: Proceeds from issuance of debt — 1,465 — 1,465 Principal payments on long-term debt and notes payable (10,085 ) (2,614 ) — (12,699 ) Advances on revolving line of credit 60,000 — — 60,000 Payments on revolving line of credit (60,000 ) — — (60,000 ) Payments for debt issuance cost (156 ) — — (156 ) Net cash used by financing activities (10,241 ) (1,149 ) — (11,390 ) Net (decrease) in cash and cash equivalents (7,869 ) (144 ) — (8,013 ) Cash and cash equivalents, beginning of year 10,251 253 — 10,504 Cash and cash equivalents, end of year $ 2,382 $ 109 $ — $ 2,491 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year ended December 31, 2015 (Amounts in thousands) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Operating activities: Net (loss) income $ (2,282 ) $ 19,326 $ (19,285 ) $ (2,241 ) Adjustments for non-cash items (14,546 ) 18,416 19,285 23,155 Net changes in operating assets and liabilities, net of acquired businesses 10,420 1,028 — 11,448 Intercompany activity 22,874 (22,874 ) — — Net cash provided by operating activities 16,466 15,896 — 32,362 Investing activities: Additions to property, plant and equipment (1,903 ) (14,696 ) — (16,599 ) Proceeds from sale of equipment — 285 — 285 Net cash (used) by investing activities (1,903 ) (14,411 ) — (16,314 ) Financing activities: Principal payments on long-term debt and notes payable (11,160 ) (2,116 ) — (13,276 ) Advances on revolving line of credit 99,000 — — 99,000 Payments on revolving line of credit (99,000 ) — — (99,000 ) Payments for debt issuance cost (210 ) 15 — (195 ) Net cash used by financing activities (11,370 ) (2,101 ) — (13,471 ) Net increase (decrease) in cash and cash equivalents 3,193 (616 ) — 2,577 Cash and cash equivalents, beginning of year 7,058 869 — 7,927 Cash and cash equivalents, end of year $ 10,251 $ 253 $ — $ 10,504 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 $ (29,060 ) $ (8,761 ) $ 8,859 $ (28,962 ) Adjustments for non-cash items 21,714 46,496 (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 by operating activities 30,294 18,823 — 49,117 Investing activities: Additions to property, plant and equipment (715 ) (15,975 ) — (16,690 ) Proceeds from sale of equipment 2,558 1,021 — 3,579 Net cash provided (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 ) Net cash used by financing activities (25,484 ) (4,167 ) — (29,651 ) Net increase (decrease) 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 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On February 16, 2017, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Sonaca S.A., a limited liability company validly existing under the laws of Belgium (the “Parent”), Sonaca USA Inc., a Delaware corporation and direct, wholly-owned subsidiary of Parent (“Intermediate Co”), and Luminance Merger Sub, Inc., a Missouri corporation and an indirect, wholly-owned subsidiary of the Parent (the “Sub,” and collectively with Parent and Intermediate Co, the “Parent Entities”), relating to the proposed acquisition of the Company by Parent. The Merger Agreement provides that, subject to the terms and conditions thereof, Sub will be merged with and into the Company (the “Merger”) with the Company continuing as the surviving corporation in the Merger (the “Surviving Corporation”). At the effective time of the Merger (the “Effective Time”) each outstanding share of common stock of the Company (other than shares owned by the Company or the Parent Entities, and shares whose holders seek appraisal and comply with all related statutory requirements of the General and Business Corporation Law of Missouri) will cease to be outstanding and will be converted into the right to receive $14.00 in cash, without interest and subject to any applicable tax withholding (the “Merger Consideration”). Shareholders of the Company will be asked to vote on the approval of the Merger Agreement at a special shareholders’ meeting that will be held on a date to be announced. The closing of the Merger is subject to the approval of the Merger Agreement by the affirmative vote of the holders of at least two-thirds of the outstanding shares of common stock of the Company (the “Shareholder Approval”). In addition to the Shareholder Approval condition, consummation of the Merger is subject to various customary conditions, including (a) the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, (b) clearance by the Committee on Foreign Investment in the United States and by the Directorate of Defense Trade Controls under the International Traffic in Arms Regulations, (c) the absence of any order, injunction or law preventing or prohibiting the consummation of the Merger, (d) the accuracy of the representations and warranties contained in the Merger Agreement (subject to certain materiality qualifiers), (e) compliance with covenants and agreements in the Merger Agreement in all material respects, and (f) the absence of a material adverse effect on the Company. The Merger Agreement contains certain termination rights for both the Company and the Parent Entities, and provides that, upon termination of the Merger Agreement by the Company or Parent upon specified conditions, the Company may be required to pay the Parent a termination fee of either $10,000 or $15,000 , depending upon the reason for and timing of the termination, and any costs of collection. In addition, subject to certain exceptions and limitations, either party may terminate the Merger Agreement if the Merger is not consummated by August 16, 2017, subject to possible extension until September 29, 2017 to allow for the completion of certain regulatory approvals or if the Shareholder Approval has not yet been obtained. The Merger Agreement also contains a “go-shop” provision that, in general, allows the Company to initiate, solicit and encourage, and engage in discussions or negotiations with respect to, an acquisition proposal for the 30-day period after execution of the Merger Agreement. The Company may continue discussions after the go-shop period with any party who made an acquisition proposal during the go-shop period that the Company determines in good faith is or could reasonably be expected to result in a superior proposal. Following the expiration of the go-shop period, the Company will be subject to a customary “no-shop” provision. The Transaction, if it were to be completed, could further limit the Company’s utilization of accumulated net operating losses, for federal income tax purposes. The Company has not performed a Section 382 study to determine if its net operating loss carryforwards could be adversely impacted by the Transaction. |
SCHEDULE II VALUATION AND QUALI
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2016 | |
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, 2016 Beginning Balance Charge to Cost/ Expense Other Charge to Cost/ Expense Write-offs net of Recoveries Ending Balance Reserve for Accounts Receivable Year ended December 31, 2014 $ 180 $ 309 $ — $ (25 ) $ 464 Year ended December 31, 2015 $ 464 $ 53 $ — $ (271 ) $ 246 Year ended December 31, 2016 $ 246 $ 116 $ — $ (14 ) $ 348 Income Tax Valuation Allowance Year ended December 31, 2014 (1) $ 18,137 $ — $ (5,461 ) $ — $ 12,676 Year ended December 31, 2015 (2) $ 12,676 $ 1,965 $ — $ — $ 14,641 Year ended December 31, 2016 (2) $ 14,641 $ 6,386 $ — $ — $ 21,027 (1) Favorable adjustment of $5,461 resulted from the Company's decision to carry back the 2013 net operating tax loss to prior years. (2) Expected net operating losses on federal and state income tax returns resulted in increases in the income tax valuation allowance. |
ACCOUNTING POLICIES (Policies)
ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
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 year 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 represent of 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 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 revenue or cost are accounted for as a change in estimate. A cumulative catch-up adjustment is recorded in the period the change in estimated cost to complete the contract is determined. In addition, should total estimated costs at completion exceed the estimated total revenue, any anticipated loss is recognized in the period in which the anticipated loss is determined. The loss is reported either as a reduction of revenue or as a component of cost of sales. During 2016 and 2015, the Company recorded losses on a cost-to-cost program of $1,903 and $2,763 , respectively, which included provisions for anticipated future loss of $722 and $476 , respectively. 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 were 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: 2016 2015 2014 Favorable adjustments $ 1,342 $ 1,308 $ 5,720 Unfavorable adjustments (2,483 ) (2,954 ) (1,719 ) Net operating income adjustments $ (1,141 ) $ (1,646 ) $ 4,001 Unfavorable cumulative catch-up adjustments of $1,903 , $2,763 and $1,479 were recorded in 2016, 2015 and 2014, respectively, related to the Mitsubishi Regional Jet design build program which has experienced higher than expected development costs. A loss provision for this contract was established in 2015 and the contract remains in a loss position at December 31, 2016. The adjustments related to this program was recorded as a reduction to revenue in the Consolidated Statements of Comprehensive Income (Loss). Favorable adjustments recorded in 2014 are primarily associated with the aforementioned Valent contract of $5,267 . The adjustments related to this program was recorded as a reduction to cost of sales in the Consolidated Statements of Comprehensive Income (Loss). Contract accounting requires management to estimate contract revenues and costs, and make assumptions related to production schedule and total units to be produced, among other matters. Due to the size, length of time and nature of many of our contracts, the estimation of total sales and cost is very complicated and subject to many variables, including development program delays and the expected recovery of deferred cost. Claims and unpriced change orders can also 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. The Company's revenue recognized in 2016 contained $933 that represented amounts associated with claims and unpriced change orders. 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. Total contract cost estimates are largely based our current cost of production, purchase order terms negotiated or estimated by our supply chain. 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-Production Costs under Long-Term Supply Contracts 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. 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 40 years, 3 to 20 years and 3 to 10 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 based on future undiscounted cash flows 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 In December 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 to rent expense over the 18 year term of the leases on a straight-line basis. At December 31, 2016 and 2015, the unamortized deferred gain of $1,906 and $2,140 , respectively, was reflected in Accrued Expenses and Other Long-Term Liabilities in the Consolidated Balance Sheet. |
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/loss 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 has remained in a cumulative loss position at December 31, 2016, 2015 and 2014. 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, 2016, 2015 and 2014, the Company's deferred tax assets remained 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, 2016 and 2015 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, 2016 . The Company has no material interest or penalties relating to income taxes recognized in the Consolidated Statement of Comprehensive Income (Loss) as of December 31, 2016 , 2015 or 2014. As of December 31, 2016 , returns for calendar 2015 remain subject to examination by the Internal Revenue Service and returns for 2013 through 2015 remain subject to examination by various state tax jurisdictions. |
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. |
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 new standard is effective for reporting periods beginning after December 15, 2017 and the Company plans to adopt the standard in the first quarter of 2018. The standard supersedes existing revenue recognition guidance, including industry-specific guidance, and provides 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. 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 adoption of the new standard may have a material impact on our income statement and balance sheet but we have not completed the quantification of that impact at this time. The Company performed a preliminary review of its significant contracts and have identified differences that would result from applying the new standard to those contracts. Based on this review, we currently expect that the timing of the recognition of revenue and related costs may change for a significant portion of our business. Some of our contracts on which we currently recognize revenue when risk of loss is transferred to the customer may recognize revenue as costs are incurred under the new standard. In addition, some long-term production contracts for which we currently recognize cost at an average expected margin over the life of the contract may recognize costs attributable to each individual unit as control is transferred to the customer. under the new standard. Adoption of the new standard will not change the total amount of revenue recognized on these contracts, only the timing of when revenue is recognized. These changes also have the potential to significantly alter the amount of deferred contract costs in inventory reported on our balance sheet. The Company is currently evaluating the transition method to be used and is implementing changes to business processes, systems and controls to support adoption of the standard. In February 2016, the FASB issued ASU 2016-02, "Leases." The standard requires lessees to recognize a lease liability and a lease asset for all leases, including operating leases, with a term greater than 12 months on its balance sheet. The new standard also expands the required quantitative and qualitative disclosures surrounding leases. The provisions of this new guidance are effective as of the beginning of the Company’s first quarter of 2019. This new standard will be applied using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the effect of this standard on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting," which amends Accounting Standards Codification (“ASC”) Topic 718, Compensation – Stock Compensation. The standard requires excess tax benefits or deficiencies for share-based payments be recorded in the period shares vest as income tax expense or benefit, rather than within Additional Paid-in Capital. Cash flows related to excess tax benefits will be included in operating activities and will no longer be separately classified as a financing activity. The new standard is effective for reporting periods beginning after December 15, 2016 and early adoption is permitted. The Company plans to adopt the new standard effective January 1, 2017 and no material impact on our financial statements is expected. In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments." The guidance addresses the classification of cash flow related to (1) debt prepayment or extinguishment costs, (2) settlement of zero-coupon debt instruments or other debt instruments with coupon rates that are insignificant in relation to the effective interest rate of the borrowing, (3) contingent consideration payments made after a business combination, (4) proceeds from the settlement of insurance claims, (5) proceeds from the settlement of corporate-owned life insurance, including bank-owned life insurance, (6) distributions received from equity method investees and (7) beneficial interests in securitization transactions. The guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The guidance will generally be applied retrospectively and is effective for financial statements issued for annual reporting periods beginning after December 15, 2017. Early application is permitted and the Company plans to adopt the new standard effective January 1, 2017. We are currently evaluating the impact of this standard on our consolidated statement of cash flows. All other issued but not yet effective accounting pronouncements are not expected to have a material impact on our Consolidated Financial Statements. |
ACCOUNTING POLICIES (Tables)
ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of catch-up adjustments | Cumulative catch-up adjustments had the following impact to operating income in the years presented: 2016 2015 2014 Favorable adjustments $ 1,342 $ 1,308 $ 5,720 Unfavorable adjustments (2,483 ) (2,954 ) (1,719 ) Net operating income adjustments $ (1,141 ) $ (1,646 ) $ 4,001 |
ASSETS AND LIABILITIES MEASUR31
ASSETS AND LIABILITIES MEASURED AT FAIR VALUE (Tables) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | ||
Valuation methodologies used for assets measured at fair value | Assets and Liabilities at Fair Value 2016 as of December 31, 2016 Total Total (Level 1) (Level 2) (Level 3) Losses Non-recurring Fair Value Measurements: Asset: Intangible assets, net (1) $ 38,852 $ — $ — $ 38,852 $ (4,066 ) Goodwill (2) $ 62,482 $ — $ — $ 62,482 $ (24,302 ) (1) The fair values of intangibles relating to the acquisition of Valent was determined by third parties in connection with the purchase and recorded at those values. The intangibles relating to the Engineering Services reporting unit were deemed impaired during 2016 and a $4,066 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. (2) The Company performed its annual impairment analysis of goodwill related to the Aerostructures reporting units during the fourth quarter of 2016 and determined no adjustments to the carrying value were necessary. The value of the goodwill relating to the Engineering Services reporting unit was deemed impaired during 2016 and a $24,302 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | 2015 Assets and Liabilities at Fair Value Total as of December 31, 2015 Gains Total (Level 1) (Level 2) (Level 3) (Losses) Non-recurring Fair Value Measurements: Asset: Intangible assets, net (1) $ 46,582 $ — $ — $ 46,582 $ — Goodwill (2) $ 86,784 $ — $ — $ 86,784 $ — (1) The fair values of intangibles relating to the acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. (2) The Company performed its annual impairment analysis of goodwill during the fourth quarter of 2015 and determined no adjustments to the carrying value were necessary. |
ACCOUNTS RECEIVABLE NET (Tables
ACCOUNTS RECEIVABLE NET (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
Schedule of accounts receivable, net | Accounts receivable, net consists of the following: December 31, 2016 2015 Trade receivables $ 44,927 $ 42,307 Unbilled revenue 4,318 4,869 Other receivables 2,372 1,561 51,617 48,737 Less: Allowance for doubtful accounts (348 ) (246 ) Accounts receivable, net $ 51,269 $ 48,491 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consist of the following: December 31, 2016 2015 Raw materials $ 12,822 $ 12,513 Work in progress 23,795 22,681 Manufactured and purchased components 20,922 19,224 Finished goods 28,346 28,169 Product inventory 85,885 82,587 Capitalized contract costs 36,876 32,188 Total inventories $ 122,761 $ 114,775 |
Schedule of Capitalized Contract Cost by Market [Table Text Block] | The following table illustrates the market to which capitalized contract cost at December 31, 2016 and December 31, 2015 related: December 31, 2016 2015 Large commercial aircraft $ 10,852 $ 11,528 Corporate and regional aircraft 21,081 16,721 Military 4,943 3,939 Total capitalized contract cost $ 36,876 $ 32,188 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | Depreciation expense (including amortization expense on software) recorded by the Company totaled $14,755 , $15,494 and $17,934 for 2016 , 2015 and 2014 , respectively. December 31, 2016 2015 Land $ 960 $ 1,108 Buildings and improvements 27,567 27,779 Machinery and equipment 137,899 129,222 Leasehold improvements 13,748 13,373 Software and other 8,510 8,507 Construction in progress 13,569 11,687 Total gross property, plant and equipment 202,253 191,676 Less accumulated depreciation (102,738 ) (90,707 ) Total net property, plant and equipment $ 99,515 $ 100,969 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The following table summarizes the net carrying amount of goodwill by segment at December 31, 2016 and 2015 , respectively: Engineering Aerostructures Services Total 2016 2015 2016 2015 2016 2015 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 ) (50,741 ) (26,439 ) (130,212 ) (105,910 ) Net Goodwill $ 62,482 $ 62,482 $ — $ 24,302 $ 62,482 $ 86,784 |
Finite and infinite lived intangible assets | Intangible assets primarily consist of trademarks and customer intangibles resulting from the acquisitions of Versaform Corporation, D3, Intec, TASS, and Valent. The trademarks resulted from the acquisitions of Intec, TASS, and Valent are fully amortized at December 31, 2016 . Customer intangibles have a remaining weighted average useful life of 15.9 years and other intangible assets have a remaining weighted average useful life of 2.1 years . The carrying values were as follows: December 31, 2016 2015 Trademarks $ 778 $ 778 Customer intangible assets 68,991 68,991 Other 1,274 1,274 Accumulated amortization (32,191 ) (24,461 ) Intangible assets, net $ 38,852 $ 46,582 |
Estimated annual amortization expense | The estimated annual amortization expense for intangible assets is as follows: Year ending December 31, 2017 $ 3,087 2018 2,854 2019 2,627 2020 2,531 2021 2,482 Thereafter 25,271 $ 38,852 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses | Accrued expenses consist of the following: December 31, 2016 2015 Accrued interest $ 7,792 $ 8,020 Receipts in excess of cost on long-term production contracts 4,782 5,097 Accrued payroll 2,367 2,481 Accrued bonus 570 3,698 Accrued vacation 1,886 1,913 Accrued employee benefits 2,863 3,075 Accrued operating lease obligations 2,350 2,475 Accrued professional fees 767 1,104 Accrued restructuring 285 255 Other 1,881 1,897 Total accrued expenses $ 25,543 $ 30,015 |
LONG-TERM DEBT AND CAPITAL LE37
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS Long-term Debt and Capital Lease Obligations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Long-term debt | Long-term debt and capital lease obligations consist of the following: December 31, 2016 2015 Second priority senior secured notes at a fixed rate of 7.375% at December 31, 2016 and December 31, 2015 $ 224,175 $ 234,175 Missouri IRBs at fixed rate of 2.80% at December 31, 2016 and December 31, 2015 6,456 6,901 Capital Leases, at fixed rates ranging from 3.00% to 4.50% at December 31, 2016 and 3.00% to 7.73% at December 31, 2015 10,293 11,708 Notes payable, principal and interest payable monthly, at fixed rates, from 2.45% to 5.00% at December 31, 2016 and from 2.45% to 2.56% at December 31, 2015 2,377 1,750 Debt issuance cost (3,248 ) (4,539 ) Total debt 240,053 249,995 Less current installments 2,655 2,362 Total long-term debt and capital lease obligations $ 237,398 $ 247,633 |
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 2017 $ 1,061 $ 1,915 2018 1,094 2,176 2019 225,183 2,450 2020 5,211 2,304 2021 177 1,208 Thereafter 282 1,554 Total 233,008 11,607 Less: imputed interest — (1,314 ) Total $ 233,008 $ 10,293 (1) Includes principal only |
DERIVATIVE FINANCIAL INSTRUME38
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives recognized in AOCI and earnings | The following amounts are included in AOCI and earnings for the years ended December 31, 2016 , December 31, 2015 and December 31, 2014: Net of Tax Derivatives in Cash Flow Hedging Relationship Effective portion of (Gain) Loss Recognized in AOCI on Derivative Effective Portion of (Gain) Loss Reclassified from AOCI into Earnings Year ended December 31, 2016 Interest rate derivatives $ — $ — Year ended December 31, 2015 Interest rate derivatives $ — $ — Year ended December 31, 2014 Interest rate derivatives $ — $ 278 |
(LOSS) EARNINGS PER COMMON SH39
(LOSS) EARNINGS PER COMMON SHARE (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
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, 2016 2015 2014 Numerators Net loss $ (35,107 ) $ (2,241 ) $ (28,962 ) Denominators Weighted average common shares - basic 13,113,901 12,869,353 12,716,976 Dilutive effect of restricted stock — — — Weighted average common shares - diluted 13,113,901 12,869,353 12,716,976 Basic earnings per share $ (2.68 ) $ (0.17 ) $ (2.28 ) Diluted earnings per share $ (2.68 ) $ (0.17 ) $ (2.28 ) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments under operating leases | At December 31, 2016 , the future minimum lease payments under operating leases with initial non-cancelable terms in excess of one year are as follows: 2017 $ 7,636 2018 7,255 2019 5,872 2020 5,057 2021 4,704 Thereafter 10,245 Total $ 40,769 |
STOCK BASED COMPENSATION (Table
STOCK BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
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 awards under the 2005 Plan is presented below: 2016 Restricted Stock Awards Shares Weighted Average Grant Date Fair Value Outstanding at January 1 253,434 $ 14.54 Granted — — Vested (53,846 ) 17.89 Forfeited (31,038 ) 14.19 Outstanding at December 31 168,550 $ 13.53 A summary of the activity for non-vested awards under the 2015 Plan is presented below: 2016 Restricted Stock Awards Shares Weighted Average Grant Date Fair Value Outstanding at January 1 61,801 $ 9.79 Granted 277,552 8.50 Vested (1) (55,672 ) 9.79 Forfeited (9,553 ) 9.43 Outstanding at December 31 274,128 $ 8.46 (1) Excludes 6,129 shares for which service requirements are met that remain subject to deferral at December 31, 2016 pursuant to the LMI Aerospace, Inc. Non-Qualified Deferred Compensation Plan for Senior Executives and Outside Directors. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of deferred tax assets and liabilities | Net deferred tax (liabilities)/assets at December 31, were as follows: December 31, 2016 2015 Deferred tax assets $ 42,336 $ 35,730 Deferred tax liabilities (21,309 ) (21,625 ) Valuation allowance (21,027 ) (14,641 ) Net deferred tax liabilities $ — $ (536 ) |
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, 2016 2015 Goodwill and intangible assets $ 13,812 $ 13,267 Inventories 2,658 2,569 NOL carry forwards 17,808 10,529 Tax credit carry forwards 2,904 2,354 Stock award 819 827 Gain on sale of real estate 698 783 Obligation under operating leases 822 835 Accrued vacation 504 504 Accrued bonus 64 649 Other 710 426 Long-term contract costs (13,496 ) (11,781 ) Depreciation (6,276 ) (6,857 ) Valuation allowance (21,027 ) (14,641 ) Net deferred tax liabilities $ — $ (536 ) |
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, 2016 , 2015 and 2014 . 2016 2015 2014 Federal: Current $ (24 ) $ 304 $ (9,173 ) Deferred (676 ) (14 ) 155 (700 ) 290 (9,018 ) State: Current (11 ) 55 21 Deferred (23 ) 7 44 (34 ) 62 65 (Benefit) provision for income taxes $ (734 ) $ 352 $ (8,953 ) |
Schedule of effective income tax rate reconciliation | The reconciliation of income tax provision (benefit) computed at the U.S. federal statutory tax rates to income tax (benefit) provision is presented below: 2016 2015 2014 Federal tax benefit $ (12,544 ) $ (661 ) $ (13,270 ) State and local taxes, net of federal benefit (464 ) (114 ) 358 Non-deductible goodwill impairment 6,296 — 9,254 Valuation allowance 6,386 1,809 (5,294 ) Tax audit adjustment (24 ) 306 — Research and experimental and other tax credits (550 ) (1,174 ) (503 ) Other 166 186 502 (Benefit) provision for income taxes $ (734 ) $ 352 $ (8,953 ) |
RESTRUCTURING (Tables)
RESTRUCTURING (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Summary of incurred and expected restructuring charges | The following table summarizes the incurred charges associated with these restructuring activities: Year ended December 31, 2016 2015 2014 Fort Worth facility closure $ — $ — $ 287 Savannah machining operations relocation — — 47 St. Charles machine parts operations relocation — 150 228 Coweta machining facility closure — 94 — Greenville office closure (26 ) 449 — Australia office closure — 47 — Wichita sheet metal fabrication operations relocation 265 — — Other employment separation activities 973 1,582 2,023 Total $ 1,212 $ 2,322 $ 2,585 Expense incurred by segment: Aerostructures $ 1,218 $ 1,108 $ 2,074 Engineering Services (6 ) 1,214 511 Total $ 1,212 $ 2,322 $ 2,585 |
Summary of restructuring activity | Employee Severance Other Total Accrued restructuring balance as of December 31, 2014 $ 739 $ — $ 739 Accrual additions 2,194 128 2,322 Cash payments (2,771 ) (35 ) (2,806 ) Accrued restructuring balance as of December 31, 2015 $ 162 $ 93 $ 255 Accrual additions 1,238 (26 ) 1,212 Cash payments (1,115 ) (67 ) (1,182 ) Accrued restructuring balance as of December 31, 2016 $ 285 $ — $ 285 |
BUSINESS SEGMENT INFORMATION (T
BUSINESS SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting Information [Line Items] | |
Segment Reporting Disclosure [Text Block] | 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, with the exception of interest expense and income taxes, primarily support the Aerostructures segment. The table below presents information by segment on the same basis used within the Company to evaluate segment performance: December 31, 2016 2015 2014 Net sales: Aerostructures $ 311,131 $ 327,230 $ 326,025 Engineering Services 36,301 49,096 63,404 Eliminations (1,252 ) (1,230 ) (1,612 ) $ 346,180 $ 375,096 $ 387,817 Gross profit: Aerostructures $ 56,774 $ 63,584 $ 67,042 Engineering Services 3,372 5,286 8,428 Eliminations (343 ) (84 ) (100 ) $ 59,803 $ 68,786 $ 75,370 (Loss) income from operations: Aerostructures $ 16,153 $ 23,993 $ 18,977 Engineering Services (1) (30,128 ) (3,123 ) (27,731 ) Eliminations (343 ) (84 ) (104 ) $ (14,318 ) $ 20,786 $ (8,858 ) Depreciation, amortization and certain other non-cash charges (credits): Aerostructures $ 18,069 $ 18,551 $ 20,223 Engineering Services (1) 29,342 1,853 28,675 $ 47,411 $ 20,404 $ 48,898 (1) Includes charges of $4,066 for intangible asset impairment and $24,302 for goodwill impairment in 2016. Includes charges of $26,439 for goodwill impairment in 2014. December 31, 2016 2015 2014 Interest expense: Aerostructures $ 807 $ 957 $ 1,041 Engineering Services 33 43 41 Corporate (1) 20,331 21,439 28,198 $ 21,171 $ 22,439 $ 29,280 (1) Includes $8,466 related to the write-off of deferred financing costs and $793 related to the settlement of debt derivatives associated with the Company's refinancing of its debt in 2014. December 31, 2016 2015 2014 Capital expenditures: Aerostructures $ 11,748 $ 16,348 $ 16,504 Engineering Services 65 251 186 $ 11,813 $ 16,599 $ 16,690 December 31, 2016 2015 Total assets: Aerostructures $ 377,214 $ 379,873 Engineering 6,418 36,107 $ 383,632 $ 415,980 |
Information about reported segments on the basis used internally to evaluate segment performance | The table below presents information by segment on the same basis used within the Company to evaluate segment performance: December 31, 2016 2015 2014 Net sales: Aerostructures $ 311,131 $ 327,230 $ 326,025 Engineering Services 36,301 49,096 63,404 Eliminations (1,252 ) (1,230 ) (1,612 ) $ 346,180 $ 375,096 $ 387,817 Gross profit: Aerostructures $ 56,774 $ 63,584 $ 67,042 Engineering Services 3,372 5,286 8,428 Eliminations (343 ) (84 ) (100 ) $ 59,803 $ 68,786 $ 75,370 (Loss) income from operations: Aerostructures $ 16,153 $ 23,993 $ 18,977 Engineering Services (1) (30,128 ) (3,123 ) (27,731 ) Eliminations (343 ) (84 ) (104 ) $ (14,318 ) $ 20,786 $ (8,858 ) Depreciation, amortization and certain other non-cash charges (credits): Aerostructures $ 18,069 $ 18,551 $ 20,223 Engineering Services (1) 29,342 1,853 28,675 $ 47,411 $ 20,404 $ 48,898 (1) Includes charges of $4,066 for intangible asset impairment and $24,302 for goodwill impairment in 2016. Includes charges of $26,439 for goodwill impairment in 2014. December 31, 2016 2015 2014 Interest expense: Aerostructures $ 807 $ 957 $ 1,041 Engineering Services 33 43 41 Corporate (1) 20,331 21,439 28,198 $ 21,171 $ 22,439 $ 29,280 (1) Includes $8,466 related to the write-off of deferred financing costs and $793 related to the settlement of debt derivatives associated with the Company's refinancing of its debt in 2014. December 31, 2016 2015 2014 Capital expenditures: Aerostructures $ 11,748 $ 16,348 $ 16,504 Engineering Services 65 251 186 $ 11,813 $ 16,599 $ 16,690 December 31, 2016 2015 Total assets: Aerostructures $ 377,214 $ 379,873 Engineering 6,418 36,107 $ 383,632 $ 415,980 |
QUARTERLY FINANCIAL DATA (UNA45
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
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 each quarter may not equal earnings per share for the year. 2016 First (1) Second (2) Third Fourth (3) Net sales $ 87,331 $ 83,993 $ 89,673 $ 85,183 Gross profit (3) $ 16,230 $ 15,535 $ 15,846 $ 12,192 Net (loss) income (1,2,3) $ (1,759 ) $ (29,900 ) $ 309 $ (3,757 ) Amounts per common share: Net (loss) income $ (0.14 ) $ (2.28 ) $ 0.02 $ (0.29 ) Net (loss) income - assuming dilution $ (0.14 ) $ (2.28 ) $ 0.02 $ (0.29 ) 2015 First (4) Second (5) Third (6) Fourth (7) Net sales $ 92,475 $ 97,550 $ 95,633 $ 89,438 Gross profit (6,7) $ 17,197 $ 18,770 $ 16,626 $ 16,193 Net (loss) income (4,5,6,7) $ (1,465 ) $ 378 $ 34 $ (1,188 ) Amounts per common share: Net (loss) income $ (0.11 ) $ 0.03 $ — $ (0.09 ) Net (loss) income - assuming dilution $ (0.11 ) $ 0.03 $ — $ (0.09 ) (1) Included in the net loss for the the first quarter of 2016 were $947 of restructuring expenses. (2) Included in the net loss for the the second quarter of 2016 was a $28,368 charge for goodwill and intangible asset impairment related to the Engineering Services reporting unit and $241 of restructuring expenses. (3) Gross profit in the fourth quarter of 2016 includes an unfavorable cumulative catch-up adjustment of $1,741 related to a long-term contract. (4) Included in the net loss for the the first quarter of 2015 were $275 of restructuring expenses. (5) Included in the net income for the the second quarter of 2015 were $518 of restructuring expenses. (6) Gross profit in the third quarter of 2015 includes an unfavorable adjustment of $1,738 related to a long-term contract for which a forward loss reserve was established. Net income for the the third quarter of 2015 also included a net gain of $3,325 related to a legal settlement and $1,575 of restructuring expenses. (7) Gross profit in the fourth quarter of 2015 includes an unfavorable cumulative catch-up adjustment of $1,010 related to a long-term contract. Net loss for the fourth quarter of 2015 also includes a restructuring benefit of $46 . |
CONDENSED CONSOLIDATING FINAN46
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Consolidating Balance Sheet | CONDENSED CONSOLIDATING BALANCE SHEET December 31, 2016 (Amounts in thousands) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Assets Current assets: Cash and cash equivalents $ 2,382 $ 109 $ — $ 2,491 Trade accounts receivable, net 660 50,609 — 51,269 Intercompany receivables 244,792 312,332 (557,124 ) — Inventories — 122,761 — 122,761 Prepaid expenses and other current assets 1,548 2,038 — 3,586 Total current assets 249,382 487,849 (557,124 ) 180,107 Property, plant and equipment, net 6,490 93,025 — 99,515 Investments in subsidiaries 375,738 — (375,738 ) — Goodwill — 62,482 — 62,482 Intangible assets, net — 38,852 — 38,852 Other assets 1,790 886 — 2,676 Total assets $ 633,400 $ 683,094 $ (932,862 ) $ 383,632 Liabilities and shareholders’ equity Current liabilities: Accounts payable $ 410 $ 28,968 $ — $ 29,378 Accrued expenses 13,912 11,631 — 25,543 Intercompany Payables 310,644 246,480 (557,124 ) — Current installments of long-term debt and capital lease obligations 89 2,566 — 2,655 Total current liabilities 325,055 289,645 (557,124 ) 57,576 Long-term debt and capital lease obligations, less current installments 221,101 16,297 — 237,398 Other long-term liabilities 1,703 1,414 — 3,117 Total long-term liabilities 222,804 17,711 — 240,515 Total shareholders’ equity 85,541 375,738 (375,738 ) 85,541 Total liabilities and shareholders’ equity $ 633,400 $ 683,094 $ (932,862 ) $ 383,632 CONDENSED CONSOLIDATING BALANCE SHEET December 31, 2015 (Amounts in thousands) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Assets Current assets: Cash and cash equivalents $ 10,251 $ 253 $ — $ 10,504 Trade accounts receivable, net 1,220 47,271 — 48,491 Intercompany receivables 196,496 203,128 (399,624 ) — Inventories — 114,775 — 114,775 Prepaid expenses and other current assets 2,224 1,923 — 4,147 Total current assets 210,191 367,350 (399,624 ) 177,917 Property, plant and equipment, net 5,430 95,539 — 100,969 Investments in subsidiaries 387,868 — (387,868 ) — Goodwill — 86,784 — 86,784 Intangible assets, net — 46,582 — 46,582 Other assets 2,135 1,593 — 3,728 Total assets $ 605,624 $ 597,848 $ (787,492 ) $ 415,980 Liabilities and shareholders’ equity Current liabilities: Accounts payable $ 1,393 $ 11,763 $ — $ 13,156 Accrued expenses 17,009 13,006 — 30,015 Intercompany Payables 237,548 162,076 (399,624 ) — Current installments of long-term debt and capital lease obligations 85 2,277 — 2,362 Total current liabilities 256,035 189,122 (399,624 ) 45,533 Long-term debt and capital lease obligations, less current installments 229,752 17,881 — 247,633 Other long-term liabilities 1,881 2,441 — 4,322 Deferred income taxes — 536 — 536 Total long-term liabilities 231,633 20,858 — 252,491 Total shareholders’ equity 117,956 387,868 (387,868 ) 117,956 Total liabilities and shareholders’ equity $ 605,624 $ 597,848 $ (787,492 ) $ 415,980 |
Condensed Consolidating Income Statement | CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) December 31, 2016 (Amounts in thousands, except share and per share data) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Sales and service revenue Product sales $ (170 ) $ 307,954 $ 305 $ 308,089 Service revenues 40,864 38,217 (40,990 ) 38,091 Net sales 40,694 346,171 (40,685 ) 346,180 Cost of sales and service revenue Cost of product sales 86 248,836 305 249,227 Cost of service revenues 42,749 35,391 (40,990 ) 37,150 Cost of sales 42,835 284,227 (40,685 ) 286,377 Gross profit (2,141 ) 61,944 — 59,803 Selling, general and administrative expenses — 44,541 — 44,541 Restructuring expense 431 781 — 1,212 Goodwill and intangible asset impairment — 28,368 — 28,368 Loss from operations (2,572 ) (11,746 ) — (14,318 ) Other income (expense): Interest expense (20,336 ) (835 ) — (21,171 ) Other, net 5 (357 ) — (352 ) (Loss) income from equity investments in subsidiaries (12,275 ) — 12,275 — Total other (expense) income (32,606 ) (1,192 ) 12,275 (21,523 ) (Loss) income before income taxes (35,178 ) (12,938 ) 12,275 (35,841 ) Benefit for income taxes — (734 ) — (734 ) Net (loss) income (35,178 ) (12,204 ) 12,275 (35,107 ) Other comprehensive (loss) income: Change in foreign currency translation adjustment — (71 ) — (71 ) Total comprehensive (loss) income $ (35,178 ) (12,275 ) $ 12,275 $ (35,178 ) CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) December 31, 2015 (Amounts in thousands, except share and per share data) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Sales and service revenue Product sales $ 239 $ 323,337 $ 35 $ 323,611 Service revenues 36,184 51,720 (36,419 ) 51,485 Net sales 36,423 375,057 (36,384 ) 375,096 Cost of sales and service revenue Cost of product sales 248 259,327 35 259,610 Cost of service revenues 35,952 47,166 (36,418 ) 46,700 Cost of sales 36,200 306,493 (36,383 ) 306,310 Gross profit 223 68,564 (1 ) 68,786 Selling, general and administrative expenses — 45,678 — 45,678 Restructuring expense 340 1,982 — 2,322 (Loss) income from operations (117 ) 20,904 (1 ) 20,786 Other income (expense): Interest expense (21,449 ) (990 ) — (22,439 ) Other, net — (236 ) — (236 ) Income (loss) from equity investments in subsidiaries 19,284 — (19,284 ) — Total other expense (2,165 ) (1,226 ) (19,284 ) (22,675 ) (Loss) income before income taxes (2,282 ) 19,678 (19,285 ) (1,889 ) Provision for income taxes — 352 — 352 Net (loss) income (2,282 ) 19,326 (19,285 ) (2,241 ) Other comprehensive (loss) income: Change in foreign currency translation adjustment — (41 ) — (41 ) Total comprehensive (loss) income $ (2,282 ) $ 19,285 $ (19,285 ) $ (2,282 ) CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) December 31, 2014 (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 Restructuring expense 1,012 1,573 — 2,585 Loss from operations (1,854 ) (7,003 ) (1 ) (8,858 ) Other (expense) income: Interest expense (28,224 ) (1,056 ) — (29,280 ) Other, net 11 212 — 223 (Loss) income from equity investments in subsidiaries (8,860 ) — 8,860 — Total other (expense) income (37,073 ) (844 ) 8,860 (29,057 ) (Loss) income before income taxes (38,927 ) (7,847 ) 8,859 (37,915 ) (Benefit) provision for income taxes (9,867 ) 914 — (8,953 ) Net (loss) income (29,060 ) (8,761 ) 8,859 (28,962 ) Other comprehensive (loss) income: Change in foreign currency translation adjustment — (98 ) — (98 ) Reclassification adjustment for losses on interest rate hedges included in net earnings 278 — — 278 Total comprehensive (loss) income $ (28,782 ) $ (8,859 ) $ 8,859 $ (28,782 ) |
Condensed Consolidating Cash Flow Statement | CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year ended December 31, 2016 (Amounts in thousands) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Operating activities: Net (loss) income $ (35,178 ) $ (12,204 ) $ 12,275 $ (35,107 ) Adjustments for non-cash items 16,955 45,304 (12,275 ) 49,984 Net changes in operating assets and liabilities, net of acquired businesses (1,566 ) 1,240 — (326 ) Intercompany activity 24,800 (24,800 ) — — Net cash provided by operating activities 5,011 9,540 — 14,551 Investing activities: Additions to property, plant and equipment (2,639 ) (9,174 ) — (11,813 ) Proceeds from sale of equipment — 639 — 639 Net cash used by investing activities (2,639 ) (8,535 ) — (11,174 ) Financing activities: Proceeds from issuance of debt — 1,465 — 1,465 Principal payments on long-term debt and notes payable (10,085 ) (2,614 ) — (12,699 ) Advances on revolving line of credit 60,000 — — 60,000 Payments on revolving line of credit (60,000 ) — — (60,000 ) Payments for debt issuance cost (156 ) — — (156 ) Net cash used by financing activities (10,241 ) (1,149 ) — (11,390 ) Net (decrease) in cash and cash equivalents (7,869 ) (144 ) — (8,013 ) Cash and cash equivalents, beginning of year 10,251 253 — 10,504 Cash and cash equivalents, end of year $ 2,382 $ 109 $ — $ 2,491 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year ended December 31, 2015 (Amounts in thousands) LMIA(Guarantor Parent) Guarantor Subsidiaries Consolidating/Eliminating Entries Consolidated Operating activities: Net (loss) income $ (2,282 ) $ 19,326 $ (19,285 ) $ (2,241 ) Adjustments for non-cash items (14,546 ) 18,416 19,285 23,155 Net changes in operating assets and liabilities, net of acquired businesses 10,420 1,028 — 11,448 Intercompany activity 22,874 (22,874 ) — — Net cash provided by operating activities 16,466 15,896 — 32,362 Investing activities: Additions to property, plant and equipment (1,903 ) (14,696 ) — (16,599 ) Proceeds from sale of equipment — 285 — 285 Net cash (used) by investing activities (1,903 ) (14,411 ) — (16,314 ) Financing activities: Principal payments on long-term debt and notes payable (11,160 ) (2,116 ) — (13,276 ) Advances on revolving line of credit 99,000 — — 99,000 Payments on revolving line of credit (99,000 ) — — (99,000 ) Payments for debt issuance cost (210 ) 15 — (195 ) Net cash used by financing activities (11,370 ) (2,101 ) — (13,471 ) Net increase (decrease) in cash and cash equivalents 3,193 (616 ) — 2,577 Cash and cash equivalents, beginning of year 7,058 869 — 7,927 Cash and cash equivalents, end of year $ 10,251 $ 253 $ — $ 10,504 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 $ (29,060 ) $ (8,761 ) $ 8,859 $ (28,962 ) Adjustments for non-cash items 21,714 46,496 (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 by operating activities 30,294 18,823 — 49,117 Investing activities: Additions to property, plant and equipment (715 ) (15,975 ) — (16,690 ) Proceeds from sale of equipment 2,558 1,021 — 3,579 Net cash provided (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 ) Net cash used by financing activities (25,484 ) (4,167 ) — (29,651 ) Net increase (decrease) 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 |
ACCOUNTING POLICIES (Details)
ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2006 | Dec. 31, 2015 | Dec. 28, 2006 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
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% | |||
Sell and lease back of real estate properties | $ 10,250 | |||
Amount of the sale price in excess of book value | $ 1,906 | $ 2,140 | $ 4,242 | |
Lease term of property | 18 years |
ACCOUNTING POLICIES, CHANGE IN
ACCOUNTING POLICIES, CHANGE IN ACCOUNTING ESTIMATE (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||||
Change in Accounting Estimate [Line Items] | |||||||||
Impairment loss on goodwill | $ 24,302 | [1] | $ 0 | [2] | |||||
revenue from claims and unpriced change orders | 933 | ||||||||
Contracts Accounted for under Percentage of Completion [Member] | |||||||||
Change in Accounting Estimate [Line Items] | |||||||||
Favorable adjustments | 1,342 | 1,308 | $ 5,720 | ||||||
Unfavorable adjustments | (2,483) | (2,954) | (1,719) | ||||||
Change in Accounting Estimate, Amount, Unfavorable Financial Effect on Operating Income, Net | (1,141) | (1,646) | |||||||
Change in Accounting Estimate, Amount, Favorable Financial Effect on Operating Income, Net | 4,001 | ||||||||
Mitsubishi Regional Jet [Member] [Member] | Contracts Accounted for under Percentage of Completion [Member] | |||||||||
Change in Accounting Estimate [Line Items] | |||||||||
Unfavorable adjustments | (1,903) | (2,763) | (1,479) | ||||||
Anticipated Forward Loss on Long-term Contract | $ 722 | $ 476 | |||||||
B-737 [Member] | Contracts Accounted for under Percentage of Completion [Member] | |||||||||
Change in Accounting Estimate [Line Items] | |||||||||
Favorable adjustments | $ 5,267 | $ 5,267 | |||||||
Valent Aerostructures, LLC [Member] | |||||||||
Change in Accounting Estimate [Line Items] | |||||||||
Impairment loss on goodwill | [2] | $ 73,528 | |||||||
Adjustment to loss provision on long-term production contract | $ 5,267 | ||||||||
[1] | The Company performed its annual impairment analysis of goodwill related to the Aerostructures reporting units during the fourth quarter of 2016 and determined no adjustments to the carrying value were necessary. The value of the goodwill relating to the Engineering Services reporting unit was deemed impaired during 2016 and a $24,302 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | ||||||||
[2] | The Company performed its annual impairment analysis of goodwill during the fourth quarter of 2015 and determined no adjustments to the carrying value were necessary. |
ACCOUNTING POLICIES ACCOUNTING
ACCOUNTING POLICIES ACCOUNTING POLICIES, PROPERTY, PLANT AND EQUIPMENT (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Building [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 40 years |
Building [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 20 years |
Machinery and Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 20 years |
Machinery and Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Computer Software, Intangible Asset [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 10 years |
Computer Software, Intangible Asset [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
ACCOUNTING POLICIES Deferred Ga
ACCOUNTING POLICIES Deferred Gain on Sales Lease-back Transaction (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 28, 2006 |
Deferred Gain on Sale Leaseback Transaction [Abstract] | |||
Sale Leaseback Transaction, Deferred Gain, Net | $ 1,906 | $ 2,140 | $ 4,242 |
ASSETS AND LIABILITIES MEASUR51
ASSETS AND LIABILITIES MEASURED AT FAIR VALUE (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | |||
Assets at Fair Value [Abstract] | ||||
Impairment loss on intangible assets | $ 4,066 | [1] | $ 0 | [2] |
Impairment loss on goodwill | 24,302 | [3] | 0 | [4] |
Non-recurring Fair Value Measurement [Member] | ||||
Assets at Fair Value [Abstract] | ||||
Intangible assets, net | 38,852 | [1] | 46,582 | [2] |
Goodwill | 62,482 | [3] | 86,784 | [4] |
Non-recurring Fair Value Measurement [Member] | Level 1 [Member] | ||||
Assets at Fair Value [Abstract] | ||||
Intangible assets, net | 0 | [1] | 0 | [2] |
Goodwill | 0 | [3] | 0 | [4] |
Non-recurring Fair Value Measurement [Member] | Level 2 [Member] | ||||
Assets at Fair Value [Abstract] | ||||
Intangible assets, net | 0 | [1] | 0 | [2] |
Goodwill | 0 | [3] | 0 | [4] |
Non-recurring Fair Value Measurement [Member] | Level 3 [Member] | ||||
Assets at Fair Value [Abstract] | ||||
Intangible assets, net | 38,852 | [1] | 46,582 | [2] |
Goodwill | 62,482 | [3] | $ 86,784 | [4] |
Engineering Services [Member] | ||||
Assets at Fair Value [Abstract] | ||||
Impairment loss on intangible assets | 4,066 | |||
Impairment loss on goodwill | $ 24,302 | |||
[1] | The fair values of intangibles relating to the acquisition of Valent was determined by third parties in connection with the purchase and recorded at those values. The intangibles relating to the Engineering Services reporting unit were deemed impaired during 2016 and a $4,066 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | |||
[2] | The fair values of intangibles relating to the acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. | |||
[3] | The Company performed its annual impairment analysis of goodwill related to the Aerostructures reporting units during the fourth quarter of 2016 and determined no adjustments to the carrying value were necessary. The value of the goodwill relating to the Engineering Services reporting unit was deemed impaired during 2016 and a $24,302 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | |||
[4] | The Company performed its annual impairment analysis of goodwill during the fourth quarter of 2015 and determined no adjustments to the carrying value were necessary. |
ACCOUNTS RECEIVABLE NET (Detail
ACCOUNTS RECEIVABLE NET (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Accounts Receivable, Net [Abstract] | ||
Trade receivables | $ 44,927 | $ 42,307 |
Unbilled revenue | 4,318 | 4,869 |
Other receivables | 2,372 | 1,561 |
Accounts receivable, gross | 51,617 | 48,737 |
Less: Allowance for doubtful accounts | (348) | (246) |
Accounts receivable, net | $ 51,269 | $ 48,491 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2016 | |
Inventory [Line Items] | ||
Inventory for Long-term Contracts or Programs, Gross | $ 32,188 | $ 36,876 |
Inventories [Abstract] | ||
Raw materials | 12,513 | 12,822 |
Work in progress | 22,681 | 23,795 |
Manufactured and purchased components | 19,224 | 20,922 |
Finished goods | 28,169 | 28,346 |
Product inventory | 82,587 | 85,885 |
Total inventories | 114,775 | 122,761 |
paymentofcashconsideration | 6,500 | |
Spirit [Member] | ||
Inventories [Abstract] | ||
Capitalized contract costs | 5,970 | 5,373 |
Large Commercial Aircraft [Member] | ||
Inventory [Line Items] | ||
Other Inventory, Capitalized Costs, Gross | 11,528 | 10,852 |
Corporate and Regional Aircraft [Member] | ||
Inventory [Line Items] | ||
Other Inventory, Capitalized Costs, Gross | 16,721 | 21,081 |
Military [Member] | ||
Inventory [Line Items] | ||
Other Inventory, Capitalized Costs, Gross | $ 3,939 | $ 4,943 |
PROPERTY, PLANT AND EQUIPMENT54
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization | $ 14,755 | $ 15,494 | $ 17,934 |
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 202,253 | 191,676 | |
Less accumulated depreciation | (102,738) | (90,707) | |
Total net property, plant and equipment | 99,515 | 100,969 | |
Land [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 960 | 1,108 | |
Buildings and Improvements [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 27,567 | 27,779 | |
Machinery and Equipment [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 137,899 | 129,222 | |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 13,748 | 13,373 | |
Software and Other [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | 8,510 | 8,507 | |
Construction in Progress [Member] | |||
Property, Plant and Equipment, Net [Abstract] | |||
Gross property, plant and equipment | $ 13,569 | $ 11,687 |
GOODWILL AND INTANGIBLE ASSETS,
GOODWILL AND INTANGIBLE ASSETS, GOODWILL (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2013 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||||
Goodwill [Line Items] | ||||||||
Gross Goodwill | $ 192,694 | $ 192,694 | ||||||
Accumulated impairment loss | (130,212) | (105,910) | ||||||
Net Goodwill | 62,482 | 86,784 | ||||||
Impairment loss on goodwill | $ 24,302 | [1] | 0 | [2] | ||||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 26.30% | |||||||
Aerostructures [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Gross Goodwill | $ 141,953 | 141,953 | ||||||
Accumulated impairment loss | (79,471) | (79,471) | ||||||
Net Goodwill | 62,482 | 62,482 | ||||||
Engineering Services [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Gross Goodwill | 50,741 | 50,741 | ||||||
Accumulated impairment loss | (50,741) | (26,439) | ||||||
Net Goodwill | 0 | $ 24,302 | ||||||
Impairment loss on goodwill | 24,302 | |||||||
Valent Aerostructures, LLC [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Adjustment to loss provision on long-term production contract | $ 5,267 | |||||||
Impairment loss on goodwill | [2] | $ 73,528 | ||||||
Valent Aerostructures, LLC [Member] | Aerostructures [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Net Goodwill | 56,288 | |||||||
Engineering Services [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Net Goodwill | 0 | |||||||
Impairment loss on goodwill | 24,302 | [3] | $ 26,439 | |||||
Integrated Technologies, Inc., TASS, Inc. and Valent Aerostructures, LLC [Member] | Aerostructures [Member] | ||||||||
Goodwill [Line Items] | ||||||||
Net Goodwill | $ 6,194 | |||||||
[1] | The Company performed its annual impairment analysis of goodwill related to the Aerostructures reporting units during the fourth quarter of 2016 and determined no adjustments to the carrying value were necessary. The value of the goodwill relating to the Engineering Services reporting unit was deemed impaired during 2016 and a $24,302 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | |||||||
[2] | The Company performed its annual impairment analysis of goodwill during the fourth quarter of 2015 and determined no adjustments to the carrying value were necessary. | |||||||
[3] | Includes charges of $4,066 for intangible asset impairment and $24,302 for goodwill impairment in 2016. Includes charges of $26,439 for goodwill impairment in 2014. |
GOODWILL AND INTANGIBLE ASSET56
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||||
Goodwill and Intangible Assets [Line Items] | |||||||
Goodwill, Impairment Loss | $ 24,302 | [1] | $ 0 | [2] | |||
Intangible Assets [Abstract] | |||||||
Trademarks | 778 | 778 | |||||
Customer intangible assets | 68,991 | 68,991 | |||||
Other | 1,274 | 1,274 | |||||
Accumulated amortization | (32,191) | (24,461) | |||||
Intangible assets, net | 38,852 | 46,582 | |||||
Amortization expense on intangible assets | 3,664 | 4,359 | $ 4,524 | ||||
Estimated annual amortization expense for these intangibles [Abstract] | |||||||
2,016 | 3,087 | ||||||
2,017 | 2,854 | ||||||
2,018 | 2,627 | ||||||
2,019 | 2,531 | ||||||
2,020 | 2,482 | ||||||
Thereafter | 25,271 | ||||||
Intangible assets, net | $ 38,852 | $ 46,582 | |||||
Customer Intangible Assets [Member] | |||||||
Intangible Assets [Abstract] | |||||||
Weighted average estimated useful life | 15 years 10 months 24 days | ||||||
Other [Member] | |||||||
Intangible Assets [Abstract] | |||||||
Weighted average estimated useful life | 2 years 29 days | ||||||
Engineering Services [Member] | |||||||
Goodwill and Intangible Assets [Line Items] | |||||||
Goodwill, Impairment Loss | $ 24,302 | [3] | $ 26,439 | ||||
Intangible Assets [Abstract] | |||||||
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | $ 4,066 | ||||||
Valent Aerostructures, LLC [Member] | |||||||
Goodwill and Intangible Assets [Line Items] | |||||||
Goodwill, Impairment Loss | [2] | $ 73,528 | |||||
[1] | The Company performed its annual impairment analysis of goodwill related to the Aerostructures reporting units during the fourth quarter of 2016 and determined no adjustments to the carrying value were necessary. The value of the goodwill relating to the Engineering Services reporting unit was deemed impaired during 2016 and a $24,302 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | ||||||
[2] | The Company performed its annual impairment analysis of goodwill during the fourth quarter of 2015 and determined no adjustments to the carrying value were necessary. | ||||||
[3] | Includes charges of $4,066 for intangible asset impairment and $24,302 for goodwill impairment in 2016. Includes charges of $26,439 for goodwill impairment in 2014. |
ACCRUED EXPENSES (Details)
ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Payables and Accruals [Abstract] | |||
Interest Payable | $ 7,792 | $ 8,020 | |
Accrued Liabilities [Abstract] | |||
Accrued payroll | 2,367 | 2,481 | |
Accrued bonus | 570 | 3,698 | |
Accrued vacation & holiday | 1,886 | 1,913 | |
Accrued employee benefits | 2,863 | 3,075 | |
Accrued operating lease obligations | 2,350 | 2,475 | |
Accrued professional fees | 767 | 1,104 | |
Restructuring Reserve | 285 | 255 | $ 739 |
Receipts in excess of cost on long-term production contracts | 4,782 | 5,097 | |
Other | 1,881 | 1,897 | |
Total accrued expenses | $ 25,543 | $ 30,015 |
ACCRUED EXPENSES, ACQUISITION-R
ACCRUED EXPENSES, ACQUISITION-RELATED (Details) $ in Thousands | 3 Months Ended |
Dec. 31, 2013USD ($) | |
Valent Aerostructures, LLC [Member] | |
Business Acquisition [Line Items] | |
Adjustment to loss provision on long-term production contract | $ 5,267 |
LONG-TERM DEBT AND CAPITAL LE59
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 19, 2014 | ||
Debt Instrument [Line Items] | ||||||
Debt Issuance Cost | $ 8,348 | $ 156 | $ 195 | $ 8,018 | ||
Long-term debt, total | 240,053 | 249,995 | ||||
Current installments of long-term debt and capital lease obligations | 2,655 | 2,362 | ||||
Long-term debt and capital lease obligations, less current installments | $ 237,398 | 247,633 | ||||
Capital Lease Obligations | 232 | |||||
Lease Expiration Date | Dec. 31, 2025 | |||||
non-cash debt settlement | 1,167 | |||||
Debt issuance cost write-off | $ 0 | 0 | 8,466 | |||
Gross amount of assets recorded under capital leases | 14,558 | |||||
Debt Issuance Cost | (3,248) | (4,539) | ||||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||||
Year ending December 31, 2016 | [1] | 1,061 | ||||
Year ending December 31, 2017 | [1] | 1,094 | ||||
Year ending December 31, 2018 | [1] | 225,183 | ||||
Year ending December 31, 2019 | [1] | 5,211 | ||||
Year ending December 31, 2020 | [1] | 177 | ||||
Thereafter | [1] | 282 | ||||
Long-term debt, total | [1] | 233,008 | ||||
Less: imputed interest | (1,314) | |||||
Long-term debt, five year maturities | [1] | 233,008 | ||||
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||||||
Year ending December 31, 2016 | 1,915 | |||||
Year ending December 31, 2017 | 2,176 | |||||
Year ending December 31, 2018 | 2,450 | |||||
Year ending December 31, 2019 | 2,304 | |||||
Year ending December 31, 2020 | 1,208 | |||||
Thereafter | 1,554 | |||||
Capital leases, total | 11,607 | |||||
Total capital leases, five year maturities | 10,293 | |||||
Second Priority Senior Secured Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 224,175 | 234,175 | ||||
Long-term debt, total | $ 250,000 | |||||
Long-term Debt, Fair Value | 225,856 | |||||
Debt Instrument, Repurchase Amount | $ 10,000 | $ 10,825 | $ 5,000 | |||
Premium Paid on Debt Repurchase | 1.875% | 0.00% | 1.125% | |||
Fixed interest rate (in hundredths) | 7.375% | 7.375% | ||||
Municipal Bonds [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 6,456 | $ 6,901 | ||||
Maturity dates | Sep. 30, 2020 | |||||
Fixed interest rate (in hundredths) | 2.80% | 2.80% | ||||
Capital Leases [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 10,293 | $ 11,708 | ||||
Maturity dates | Jun. 30, 2032 | |||||
Notes Payable [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 2,377 | $ 1,750 | ||||
Minimum [Member] | Municipal Bonds [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 2.80% | |||||
Minimum [Member] | Capital Leases [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 3.00% | 3.00% | ||||
Minimum [Member] | Notes Payable [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 2.45% | 2.45% | ||||
Minimum [Member] | Equipment [Member] | Notes Payable [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 2.45% | |||||
Maximum [Member] | Municipal Bonds [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 4.50% | |||||
Maximum [Member] | Capital Leases [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 4.50% | 7.73% | ||||
Maximum [Member] | Notes Payable [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 5.00% | 2.56% | ||||
Maximum [Member] | Equipment [Member] | Notes Payable [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 5.00% | |||||
[1] | Includes principal only |
LONG-TERM DEBT AND CAPITAL LE60
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, LINE OF CREDIT FACILITY (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Line of Credit Facility [Line Items] | |
Line of Credit Facility, Remaining Borrowing Capacity | $ 75,000 |
Letters of Credit Outstanding, Amount | 1,525 |
Maximum borrowing capacity | 90,000 |
Reserve Against line of Credit | 15,000 |
Line of Credit Facility, Average Outstanding Amount | $ 164 |
Line of Credit Facility, Interest Rate During Period | 5.80% |
Commitment fee (in hundredths) | 0.50% |
Line of Credit Facility, Current Borrowing Capacity | $ 49,728 |
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) | 0.375% |
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 INSTRUME61
DERIVATIVE FINANCIAL INSTRUMENTS (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2014USD ($) | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative, Loss on Derivative | $ 793 |
DERIVATIVE FINANCIAL INSTRUME62
DERIVATIVE FINANCIAL INSTRUMENTS, FAIR VALUE BY INCOME STATEMENT LOCATION (Details) - Interest Rate Swap [Member] - Cash Flow Hedging [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Effective portion of (Gain) Loss Recognized in AOCI on Derivative | $ 0 | $ 0 | $ 0 |
Effective Portion of (Gain) Loss Reclassified from AOCI into Earnings | $ 0 | $ 0 | $ 278 |
(LOSS) EARNINGS PER COMMON SH63
(LOSS) EARNINGS PER COMMON SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||||||
Numerators [Abstract] | ||||||||||||||||||
Net loss | $ (3,757) | [1] | $ 309 | $ (29,900) | [2] | $ (1,759) | [3] | $ (1,188) | [4] | $ 34 | [5] | $ 378 | [6] | $ (1,465) | [7] | $ (35,107) | $ (2,241) | $ (28,962) |
Denominators [Abstract] | ||||||||||||||||||
Weighted average common shares - basic (in shares) | 13,113,901 | 12,869,353 | 12,716,976 | |||||||||||||||
Dilutive effect of restricted stock (in shares) | 0 | 0 | 0 | |||||||||||||||
Weighted average common shares - diluted (in shares) | 13,113,901 | 12,869,353 | 12,716,976 | |||||||||||||||
Basic earnings per share (in dollars per share) | $ (0.29) | $ 0.02 | $ (2.28) | $ (0.14) | $ (0.09) | $ 0 | $ 0.03 | $ (0.11) | $ (2.68) | $ (0.17) | $ (2.28) | |||||||
Diluted earnings per share (in dollars per share) | $ (0.29) | $ 0.02 | $ (2.28) | $ (0.14) | $ (0.09) | $ 0 | $ 0.03 | $ (0.11) | $ (2.68) | $ (0.17) | $ (2.28) | |||||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 94,408 | 159,875 | 153,249 | |||||||||||||||
[1] | Gross profit in the fourth quarter of 2016 includes an unfavorable cumulative catch-up adjustment of $1,741 related to a long-term contract. | |||||||||||||||||
[2] | Included in the net loss for the the second quarter of 2016 was a $28,368 charge for goodwill and intangible asset impairment related to the Engineering Services reporting unit and $241 of restructuring expenses. | |||||||||||||||||
[3] | Included in the net loss for the the first quarter of 2016 were $947 of restructuring expenses. | |||||||||||||||||
[4] | Gross profit in the fourth quarter of 2015 includes an unfavorable cumulative catch-up adjustment of $1,010 related to a long-term contract. Net loss for the fourth quarter of 2015 also includes a restructuring benefit of $46. | |||||||||||||||||
[5] | Gross profit in the third quarter of 2015 includes an unfavorable adjustment of $1,738 related to a long-term contract for which a forward loss reserve was established. Net income for the the third quarter of 2015 also included a net gain of $3,325 related to a legal settlement and $1,575 of restructuring expenses. | |||||||||||||||||
[6] | Included in the net income for the the second quarter of 2015 were $518 of restructuring expenses. | |||||||||||||||||
[7] | Included in the net loss for the the first quarter of 2015 were $275 of restructuring expenses. |
COMMITMENTS AND CONTINGENCIES64
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Loss Contingencies [Line Items] | |||
Lease Expiration Date | Dec. 31, 2025 | ||
Future minimum lease payments under operating leases [Abstract] | |||
2,016 | $ 7,636 | ||
2,017 | 7,255 | ||
2,018 | 5,872 | ||
2,019 | 5,057 | ||
2,020 | 4,704 | ||
Thereafter | 10,245 | ||
Total | 40,769 | ||
Operating lease rent expense | $ 7,479 | $ 7,753 | $ 8,396 |
COMMITMENTS AND CONTINGENCIES,
COMMITMENTS AND CONTINGENCIES, LOSS CONTINGENCIES (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2015 | |
Loss Contingencies [Line Items] | |||
Loss Contingency, Settlement Agreement, Terms | As a result of the settlement: (a) the Tech Lawsuit was dismissed with prejudice on January 12, 2016, (b) $3,109 of the funds that remained in escrow from the sale were disbursed to the Company and the remaining amount of escrow funds was retained by Tech Investments, (c) Tech Investments assumed an approximate $1,167 payment obligation of the Company to a predecessor owner of OMT that remained under a purchase agreement the Company acquired as part of the Company’s acquisition of Valent; (d) locked-up shares representing partial consideration for the purchase price paid by the Company were released to Tech Investments; and (e) all parties entered into a mutual release of certain claims and disputes. The settlement also resulted in the Company assuming other liabilities of $500, collecting a previously recorded receivable of $389 and recording other expenses of $40. | ||
Gain (Loss) Related to Litigation Settlement | $ 3,325 | $ 3,347 | |
Environmental Protection Agency [Member] | |||
Loss Contingencies [Line Items] | |||
Environmental Penalties Paid | $ 694 | ||
Unfavorable Regulatory Action [Member] | |||
Loss Contingencies [Line Items] | |||
Environmental Penalties Paid | $ 175 |
DEFINED CONTRIBUTIONS PLANS (De
DEFINED CONTRIBUTIONS PLANS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Defined Contribution Plan, Employers Matching Contribution, Annual Vesting Percentage | 25.00% | ||
LMI Profit Sharing and Savings Plan [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Maximum annual contribution per employee amount | $ 1 | ||
Recognized cost for matching contributions | $ 1,451 | $ 1,519 | $ 729 |
Employer matching contribution percentage (in hundredths) | 50.00% | ||
Valent Plans [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Recognized cost for matching contributions | $ 848 | ||
Employer matching contribution percentage (in hundredths) | 3.00% | ||
Employer matching contribution threshold | 3.00% | ||
Engineering Services [Member] | LMI Profit Sharing and Savings Plan [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer matching contribution threshold | 3.00% | ||
Aerostructures [Member] | LMI Profit Sharing and Savings Plan [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer matching contribution threshold | 5.00% |
STOCK BASED COMPENSATION (Detai
STOCK BASED COMPENSATION (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Weighted Average Grant Date Fair Value | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Exercise Price | $ 528,000 | $ 0 | ||
Restricted Stock Awards [Member] | ||||
Weighted Average Grant Date Fair Value | ||||
Costs are expected to be recognized over a weighted average period | 1 year 2 months 1 day | 1 year 6 months 22 days | ||
LMI Aerospace, Inc. 2005 Long-Term Incentive Plan [Member] | ||||
Weighted Average Grant Date Fair Value | ||||
Compensation expense | $ 485 | $ 1,284 | $ 1,850 | |
LMI Aerospace, Inc. 2005 Long-Term Incentive Plan [Member] | Restricted Stock Awards [Member] | ||||
Shares | ||||
Outstanding beginning balance (in shares) | 253,434 | |||
Granted (in shares) | 0 | |||
Vested (in shares) | (53,846) | |||
Forfeited (in shares) | (31,038) | |||
Outstanding ending balance (in shares) | 168,550 | 253,434 | ||
Weighted Average Grant Date Fair Value | ||||
Outstanding beginning balance (in dollars per share) | $ 14.54 | |||
Granted (in dollars per share) | 0 | |||
Vested (in dollars per share) | 17.89 | |||
Forfeited (in dollars per share) | 14.19 | |||
Outstanding ending balance (in dollars per share) | $ 13.53 | $ 14.54 | ||
Unrecognized compensation costs | $ 513 | $ 1,762 | ||
Fair value of restricted stock awards that vested | $ 527 | 1,559 | $ 1,083 | |
LMI Aerospace, Inc. 2015 Long-term Incentive Plan - Non Qualified Deferred Compensation Plan for Senior Executives and Outside Directors [Member] | Restricted Stock Awards [Member] | ||||
Shares | ||||
Outstanding ending balance (in shares) | 6,129 | |||
LMI Aerospace, Inc. 2015 Long-term Incentive Plan [Member] | ||||
Weighted Average Grant Date Fair Value | ||||
Compensation expense | $ 992 | $ 303 | ||
LMI Aerospace, Inc. 2015 Long-term Incentive Plan [Member] | Restricted Stock Awards [Member] | ||||
Shares | ||||
Outstanding beginning balance (in shares) | 61,801 | |||
Granted (in shares) | 277,552 | |||
Vested (in shares) | [1] | (55,672) | ||
Forfeited (in shares) | (9,553) | |||
Outstanding ending balance (in shares) | 274,128 | 61,801 | ||
Weighted Average Grant Date Fair Value | ||||
Outstanding beginning balance (in dollars per share) | $ 9.79 | |||
Granted (in dollars per share) | 8.50 | |||
Vested (in dollars per share) | 9.79 | |||
Forfeited (in dollars per share) | 9.43 | |||
Outstanding ending balance (in dollars per share) | $ 8.46 | $ 9.79 | ||
Unrecognized compensation costs | $ 1,510 | $ 303 | ||
Costs are expected to be recognized over a weighted average period | 1 year 9 months 18 days | 6 months 4 days | ||
[1] | Excludes 6,129 shares for which service requirements are met that remain subject to deferral at December 31, 2016 pursuant to the LMI Aerospace, Inc. Non-Qualified Deferred Compensation Plan for Senior Executives and Outside Directors. |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Deferred Tax Assets, Gross | $ 42,336 | $ 35,730 | |
Deferred Tax Liabilities, Gross | (21,309) | (21,625) | |
Deferred Tax Assets, Valuation Allowance | (21,027) | (14,641) | |
Deferred Tax Liabilities, Net | 0 | (536) | |
Components of Deferred Tax Assets and Liabilities [Abstract] | |||
Goodwill and intangible assets | 13,812 | 13,267 | |
Inventories | 2,658 | 2,569 | |
NOL carry forwards | 17,808 | 10,529 | |
Tax credit carry forwards | 2,904 | 2,354 | |
Stock award | 819 | 827 | |
Gain on sale of real estate | 698 | 783 | |
Obligation under operating leases | 822 | 835 | |
Accrued vacation | 504 | 504 | |
Accrued bonus | 64 | 649 | |
Other | 710 | 426 | |
Long-term contract costs | (13,496) | (11,781) | |
Depreciation | (6,276) | (6,857) | |
Valuation allowance | (21,027) | (14,641) | |
Income Tax Expense (Benefit), Continuing Operations, by Jurisdiction [Abstract] | |||
Increase (Decrease) in Income Taxes Receivable | 6,527 | ||
Deferred Tax Assets, Operating Loss Carryforwards, Domestic | 17,044 | ||
Deferred Tax Assets, Operating Loss Carryforwards, State and Local | 3,668 | ||
Federal [Abstract] | |||
Current | (24) | 304 | $ (9,173) |
Deferred | (676) | (14) | 155 |
Provision for federal income taxes | (700) | 290 | (9,018) |
State [Abstract] | |||
Current | (11) | 55 | 21 |
Deferred | (23) | 7 | 44 |
Provision for state income taxes | (34) | 62 | 65 |
Income Tax Reconciliation [Abstract] | |||
Federal taxes | (12,544) | (661) | (13,270) |
State and local taxes, net of federal benefit | (464) | (114) | 358 |
Nondeductible goodwill impairment | 6,296 | 0 | 9,254 |
Valuation allowance | 6,386 | 1,809 | (5,294) |
Effective Income Tax Rate Reconciliation, Other Reconciling Items, Amount | (24) | 306 | 0 |
Research and experimental and other tax credits | (550) | (1,174) | (503) |
Other | 166 | 186 | 502 |
Provision (benefit) for income taxes | $ (734) | $ 352 | $ (8,953) |
RESTRUCTURING (Details)
RESTRUCTURING (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||
Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring and Related Cost, Accelerated Depreciation | $ 295 | $ 1,265 | $ 1,361 | ||||||
Restructuring expense | 1,212 | 2,322 | 2,585 | ||||||
Restructuring and Related Cost, Incurred Cost | $ 241 | $ 947 | $ (46) | $ 1,575 | $ 518 | $ 275 | |||
Unfavorable impact to operating cash flow | 1,182 | 2,806 | 2,268 | ||||||
Restructuring Reserve | 255 | 285 | 255 | 739 | |||||
Employee Severance [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | 1,238 | 2,194 | |||||||
Unfavorable impact to operating cash flow | 1,115 | 2,771 | |||||||
Restructuring Reserve | 162 | 285 | 162 | 739 | |||||
Employee Severance [Member] | Precise Machine [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | 0 | 0 | 287 | ||||||
Employee Severance [Member] | Greenville, South Carolina [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | (26) | 449 | 0 | ||||||
Employee Severance [Member] | Engineering Services Melbourne, Australia Closure [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | 0 | 47 | 0 | ||||||
Employee Severance [Member] | Relocation of Machining Operations from Savannah Facility [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | 0 | 0 | 47 | ||||||
Employee Severance [Member] | Relocation of Machining Parts Operations from St. Charles Facility [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | 0 | 150 | 228 | ||||||
Employee Severance [Member] | Coweta, Oklahoma Closure [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | 0 | 94 | 0 | ||||||
Employee Severance [Member] | Other Expense [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | 973 | 1,582 | 2,023 | ||||||
Other [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | (26) | 128 | |||||||
Unfavorable impact to operating cash flow | 67 | 35 | |||||||
Restructuring Reserve | $ 93 | 0 | 93 | 0 | |||||
Selling, General and Administrative Expenses [Member] | Employee Severance [Member] | Relocation of Sheet Metal Operations from Wichita [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring and Related Cost, Incurred Cost | 265 | 0 | 0 | ||||||
Aerostructures [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | 1,218 | 1,108 | 2,074 | ||||||
Engineering Services [Member] | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring expense | $ (6) | $ 1,214 | $ 511 |
RESTRUCTURING, ROLLFORWARD (Det
RESTRUCTURING, ROLLFORWARD (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restructuring Reserve [Roll Forward] | |||
Accrued restructuring balance, beginning | $ 255 | $ 739 | |
Accrual additions | 1,212 | 2,322 | $ 2,585 |
Cash payments | (1,182) | (2,806) | (2,268) |
Accrued restructuring balance, ending | 285 | 255 | 739 |
Employee Severance [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Accrued restructuring balance, beginning | 162 | 739 | |
Accrual additions | 1,238 | 2,194 | |
Cash payments | (1,115) | (2,771) | |
Accrued restructuring balance, ending | 285 | 162 | 739 |
Other [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Accrued restructuring balance, beginning | 93 | 0 | |
Accrual additions | (26) | 128 | |
Cash payments | (67) | (35) | |
Accrued restructuring balance, ending | $ 0 | $ 93 | $ 0 |
CUSTOMER AND SUPPLIER CONCENT71
CUSTOMER AND SUPPLIER CONCENTRATION (Details) | 12 Months Ended | ||
Dec. 31, 2016suppliercustomer | Dec. 31, 2015 | Dec. 31, 2014customer | |
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Number of top customers | 3 | 3 | 3 |
Supplier Concentration Risk [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Number of suppliers | 6 | ||
Percentage of materials attributable to supplier (in hundredths) | 45.50% | 45.90% | 49.60% |
Spirit [Member] | Sales Revenue, Goods, Net [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 38.38% | 34.70% | 34.32% |
Spirit [Member] | Accounts Receivable [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 31.84% | 28.60% | 33.30% |
Gulfstream [Member] | Sales Revenue, Goods, Net [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 11.69% | 14.20% | 15.00% |
Gulfstream [Member] | Accounts Receivable [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 12.27% | 15.50% | 13.10% |
Boeing [Member] | Sales Revenue, Goods, Net [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 11.21% | 11.60% | 10.60% |
Boeing [Member] | Accounts Receivable [Member] | |||
Revenue and Accounts Receivable, Major Customer [Line Items] | |||
Percentage attributable to customer (in hundredths) | 8.48% | 10.20% | 7.40% |
BUSINESS SEGMENT INFORMATION (D
BUSINESS SEGMENT INFORMATION (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2016USD ($)segment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | ||||||||
Segment Reporting [Abstract] | |||||||||||||||||||
Number of reportable segments | segment | 2 | ||||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | |||||||||||||||||||
Net sales | $ 85,183 | $ 89,673 | $ 83,993 | $ 87,331 | $ 89,438 | $ 95,633 | $ 97,550 | $ 92,475 | $ 346,180 | $ 375,096 | $ 387,817 | ||||||||
Gross profit | 12,192 | [1] | $ 15,846 | $ 15,535 | $ 16,230 | 16,193 | [2] | $ 16,626 | [3] | $ 18,770 | $ 17,197 | 59,803 | 68,786 | 75,370 | |||||
(Loss) income from operations | (14,318) | [4] | 20,786 | (8,858) | [4] | ||||||||||||||
Other Depreciation and Amortization | 47,411 | [4] | 20,404 | 48,898 | [4] | ||||||||||||||
Interest expense | 21,171 | 22,439 | 29,280 | [5] | |||||||||||||||
Capital expenditures | 11,813 | 16,599 | 16,690 | ||||||||||||||||
Total assets | 383,632 | 415,980 | 383,632 | 415,980 | |||||||||||||||
Impairment loss on goodwill | 24,302 | [6] | 0 | [7] | |||||||||||||||
Impairment loss on intangible assets | 4,066 | [8] | 0 | [9] | |||||||||||||||
Debt issuance cost write-off | 0 | 0 | 8,466 | ||||||||||||||||
Aerostructures [Member] | |||||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | |||||||||||||||||||
Net sales | 311,131 | 327,230 | 326,025 | ||||||||||||||||
Gross profit | 56,774 | 63,584 | 67,042 | ||||||||||||||||
(Loss) income from operations | 16,153 | 23,993 | 18,977 | ||||||||||||||||
Other Depreciation and Amortization | 18,069 | 18,551 | 20,223 | ||||||||||||||||
Interest expense | 807 | 957 | 1,041 | ||||||||||||||||
Capital expenditures | 11,748 | 16,348 | 16,504 | ||||||||||||||||
Total assets | 377,214 | 379,873 | 377,214 | 379,873 | |||||||||||||||
Engineering Services [Member] | |||||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | |||||||||||||||||||
Net sales | 36,301 | 49,096 | 63,404 | ||||||||||||||||
Gross profit | 3,372 | 5,286 | 8,428 | ||||||||||||||||
(Loss) income from operations | (30,128) | [4] | (3,123) | (27,731) | [4] | ||||||||||||||
Other Depreciation and Amortization | 29,342 | [4] | 1,853 | 28,675 | [4] | ||||||||||||||
Interest expense | 33 | 43 | 41 | ||||||||||||||||
Capital expenditures | 65 | 251 | 186 | ||||||||||||||||
Total assets | $ 6,418 | $ 36,107 | 6,418 | 36,107 | |||||||||||||||
Impairment loss on goodwill | 24,302 | ||||||||||||||||||
Impairment loss on intangible assets | 4,066 | ||||||||||||||||||
Eliminations [Member] | |||||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | |||||||||||||||||||
Net sales | (1,252) | (1,230) | (1,612) | ||||||||||||||||
Gross profit | (343) | (84) | (100) | ||||||||||||||||
(Loss) income from operations | (343) | (84) | (104) | ||||||||||||||||
Corporate [Member] | |||||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | |||||||||||||||||||
Interest expense | 20,331 | $ 21,439 | 28,198 | [5] | |||||||||||||||
Engineering Services [Member] | |||||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | |||||||||||||||||||
Impairment loss on goodwill | 24,302 | [4] | $ 26,439 | ||||||||||||||||
Impairment loss on intangible assets | $ 4,066 | ||||||||||||||||||
Valent Aerostructures, LLC [Member] | |||||||||||||||||||
Information about reported segments on the basis used internally to evaluate segment performance [Abstract] | |||||||||||||||||||
Impairment loss on goodwill | [7] | $ 73,528 | |||||||||||||||||
[1] | Gross profit in the fourth quarter of 2016 includes an unfavorable cumulative catch-up adjustment of $1,741 related to a long-term contract. | ||||||||||||||||||
[2] | Gross profit in the fourth quarter of 2015 includes an unfavorable cumulative catch-up adjustment of $1,010 related to a long-term contract. Net loss for the fourth quarter of 2015 also includes a restructuring benefit of $46. | ||||||||||||||||||
[3] | Gross profit in the third quarter of 2015 includes an unfavorable adjustment of $1,738 related to a long-term contract for which a forward loss reserve was established. Net income for the the third quarter of 2015 also included a net gain of $3,325 related to a legal settlement and $1,575 of restructuring expenses. | ||||||||||||||||||
[4] | Includes charges of $4,066 for intangible asset impairment and $24,302 for goodwill impairment in 2016. Includes charges of $26,439 for goodwill impairment in 2014. | ||||||||||||||||||
[5] | Includes $8,466 related to the write-off of deferred financing costs and $793 related to the settlement of debt derivatives associated with the Company's refinancing of its debt in 2014. | ||||||||||||||||||
[6] | The Company performed its annual impairment analysis of goodwill related to the Aerostructures reporting units during the fourth quarter of 2016 and determined no adjustments to the carrying value were necessary. The value of the goodwill relating to the Engineering Services reporting unit was deemed impaired during 2016 and a $24,302 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | ||||||||||||||||||
[7] | The Company performed its annual impairment analysis of goodwill during the fourth quarter of 2015 and determined no adjustments to the carrying value were necessary. | ||||||||||||||||||
[8] | The fair values of intangibles relating to the acquisition of Valent was determined by third parties in connection with the purchase and recorded at those values. The intangibles relating to the Engineering Services reporting unit were deemed impaired during 2016 and a $4,066 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | ||||||||||||||||||
[9] | The fair values of intangibles relating to the acquisitions of TASS and Valent were determined by third parties in connection with the purchase and recorded at those values. |
QUARTERLY FINANCIAL DATA (UNA73
QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||||||||
Restructuring and Related Cost, Incurred Cost | $ (241) | $ (947) | $ 46 | $ (1,575) | $ (518) | $ (275) | ||||||||||||||
Goodwill and Intangible Asset Impairment | 28,368 | $ 28,368 | ||||||||||||||||||
Loss on Contracts | $ 1,741 | 1,010 | 1,738 | |||||||||||||||||
Gain (Loss) Related to Litigation Settlement | 3,325 | $ 3,347 | ||||||||||||||||||
Impairment loss on goodwill | 24,302 | [1] | 0 | [2] | ||||||||||||||||
Derivative, Loss on Derivative | $ 793 | |||||||||||||||||||
Debt issuance cost write-off | 0 | 0 | 8,466 | |||||||||||||||||
Income Tax Expense (Benefit) | 734 | (352) | 8,953 | |||||||||||||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||
Net sales | 85,183 | $ 89,673 | 83,993 | 87,331 | 89,438 | 95,633 | 97,550 | 92,475 | 346,180 | 375,096 | 387,817 | |||||||||
Gross profit | 12,192 | [3] | 15,846 | 15,535 | 16,230 | 16,193 | [4] | 16,626 | [5] | 18,770 | 17,197 | 59,803 | 68,786 | 75,370 | ||||||
Net income (loss) | $ (3,757) | [3] | $ 309 | $ (29,900) | [6] | $ (1,759) | [7] | $ (1,188) | [4] | $ 34 | [5] | $ 378 | [8] | $ (1,465) | [9] | $ (35,107) | $ (2,241) | $ (28,962) | ||
Amounts per common share: | ||||||||||||||||||||
Net income (loss) (in dollars per share) | $ (0.29) | $ 0.02 | $ (2.28) | $ (0.14) | $ (0.09) | $ 0 | $ 0.03 | $ (0.11) | $ (2.68) | $ (0.17) | $ (2.28) | |||||||||
Net income (loss) - assuming dilution (in dollars per share) | $ (0.29) | $ 0.02 | $ (2.28) | $ (0.14) | $ (0.09) | $ 0 | $ 0.03 | $ (0.11) | $ (2.68) | $ (0.17) | $ (2.28) | |||||||||
[1] | The Company performed its annual impairment analysis of goodwill related to the Aerostructures reporting units during the fourth quarter of 2016 and determined no adjustments to the carrying value were necessary. The value of the goodwill relating to the Engineering Services reporting unit was deemed impaired during 2016 and a $24,302 impairment charge was recorded in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016. | |||||||||||||||||||
[2] | The Company performed its annual impairment analysis of goodwill during the fourth quarter of 2015 and determined no adjustments to the carrying value were necessary. | |||||||||||||||||||
[3] | Gross profit in the fourth quarter of 2016 includes an unfavorable cumulative catch-up adjustment of $1,741 related to a long-term contract. | |||||||||||||||||||
[4] | Gross profit in the fourth quarter of 2015 includes an unfavorable cumulative catch-up adjustment of $1,010 related to a long-term contract. Net loss for the fourth quarter of 2015 also includes a restructuring benefit of $46. | |||||||||||||||||||
[5] | Gross profit in the third quarter of 2015 includes an unfavorable adjustment of $1,738 related to a long-term contract for which a forward loss reserve was established. Net income for the the third quarter of 2015 also included a net gain of $3,325 related to a legal settlement and $1,575 of restructuring expenses. | |||||||||||||||||||
[6] | Included in the net loss for the the second quarter of 2016 was a $28,368 charge for goodwill and intangible asset impairment related to the Engineering Services reporting unit and $241 of restructuring expenses. | |||||||||||||||||||
[7] | Included in the net loss for the the first quarter of 2016 were $947 of restructuring expenses. | |||||||||||||||||||
[8] | Included in the net income for the the second quarter of 2015 were $518 of restructuring expenses. | |||||||||||||||||||
[9] | Included in the net loss for the the first quarter of 2015 were $275 of restructuring expenses. |
CONDENSED CONSOLIDATING BALANCE
CONDENSED CONSOLIDATING BALANCE SHEET (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Cash and cash equivalents | $ 2,491 | $ 10,504 | $ 7,927 | $ 1,572 |
Trade accounts receivable, net | 51,269 | 48,491 | ||
Intercompany receivables | 0 | 0 | ||
Inventories | 122,761 | 114,775 | ||
Prepaid expenses and other current assets | 3,586 | 4,147 | ||
Total current assets | 180,107 | 177,917 | ||
Property, plant and equipment, net | 99,515 | 100,969 | ||
Investments in subsidiaries | 0 | 0 | ||
Goodwill | 62,482 | 86,784 | ||
Intangible assets, net | 38,852 | 46,582 | ||
Other assets | 2,676 | 3,728 | ||
Total assets | 383,632 | 415,980 | ||
Accounts payable | 29,378 | 13,156 | ||
Accrued expenses | 25,543 | 30,015 | ||
Intercompany payables | 0 | 0 | ||
Current installments of long-term debt and capital lease obligations | 2,655 | 2,362 | ||
Total current liabilities | 57,576 | 45,533 | ||
Long-term debt and capital lease obligations, less current installments | 237,398 | 247,633 | ||
Other long-term liabilities | 3,117 | 4,322 | ||
Deferred income taxes | 0 | 536 | ||
Total long-term liabilities | 240,515 | 252,491 | ||
Total shareholders’ equity | 85,541 | 117,956 | 118,135 | 144,144 |
Total liabilities and shareholders’ equity | 383,632 | 415,980 | ||
LMIA(Guarantor Parent) | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Cash and cash equivalents | 2,382 | 10,251 | 7,058 | 405 |
Trade accounts receivable, net | 660 | 1,220 | ||
Intercompany receivables | 244,792 | 196,496 | ||
Inventories | 0 | 0 | ||
Prepaid expenses and other current assets | 1,548 | 2,224 | ||
Total current assets | 249,382 | 210,191 | ||
Property, plant and equipment, net | 6,490 | 5,430 | ||
Investments in subsidiaries | 375,738 | 387,868 | ||
Goodwill | 0 | 0 | ||
Intangible assets, net | 0 | 0 | ||
Other assets | 1,790 | 2,135 | ||
Total assets | 633,400 | 605,624 | ||
Accounts payable | 410 | 1,393 | ||
Accrued expenses | 13,912 | 17,009 | ||
Intercompany payables | 310,644 | 237,548 | ||
Current installments of long-term debt and capital lease obligations | 89 | 85 | ||
Total current liabilities | 325,055 | 256,035 | ||
Long-term debt and capital lease obligations, less current installments | 221,101 | 229,752 | ||
Other long-term liabilities | 1,703 | 1,881 | ||
Deferred income taxes | 0 | |||
Total long-term liabilities | 222,804 | 231,633 | ||
Total shareholders’ equity | 85,541 | 117,956 | ||
Total liabilities and shareholders’ equity | 633,400 | 605,624 | ||
Guarantor Subsidiaries | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Cash and cash equivalents | 109 | 253 | 869 | 1,167 |
Trade accounts receivable, net | 50,609 | 47,271 | ||
Intercompany receivables | 312,332 | 203,128 | ||
Inventories | 122,761 | 114,775 | ||
Prepaid expenses and other current assets | 2,038 | 1,923 | ||
Total current assets | 487,849 | 367,350 | ||
Property, plant and equipment, net | 93,025 | 95,539 | ||
Investments in subsidiaries | 0 | 0 | ||
Goodwill | 62,482 | 86,784 | ||
Intangible assets, net | 38,852 | 46,582 | ||
Other assets | 886 | 1,593 | ||
Total assets | 683,094 | 597,848 | ||
Accounts payable | 28,968 | 11,763 | ||
Accrued expenses | 11,631 | 13,006 | ||
Intercompany payables | 246,480 | 162,076 | ||
Current installments of long-term debt and capital lease obligations | 2,566 | 2,277 | ||
Total current liabilities | 289,645 | 189,122 | ||
Long-term debt and capital lease obligations, less current installments | 16,297 | 17,881 | ||
Other long-term liabilities | 1,414 | 2,441 | ||
Deferred income taxes | 536 | |||
Total long-term liabilities | 17,711 | 20,858 | ||
Total shareholders’ equity | 375,738 | 387,868 | ||
Total liabilities and shareholders’ equity | 683,094 | 597,848 | ||
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 | (557,124) | (399,624) | ||
Inventories | 0 | 0 | ||
Prepaid expenses and other current assets | 0 | 0 | ||
Total current assets | (557,124) | (399,624) | ||
Property, plant and equipment, net | 0 | 0 | ||
Investments in subsidiaries | (375,738) | (387,868) | ||
Goodwill | 0 | 0 | ||
Intangible assets, net | 0 | 0 | ||
Other assets | 0 | 0 | ||
Total assets | (932,862) | (787,492) | ||
Accounts payable | 0 | 0 | ||
Accrued expenses | 0 | 0 | ||
Intercompany payables | (557,124) | (399,624) | ||
Current installments of long-term debt and capital lease obligations | 0 | 0 | ||
Total current liabilities | (557,124) | (399,624) | ||
Long-term debt and capital lease obligations, less current installments | 0 | 0 | ||
Other long-term liabilities | 0 | 0 | ||
Deferred income taxes | 0 | |||
Total long-term liabilities | 0 | 0 | ||
Total shareholders’ equity | (375,738) | (387,868) | ||
Total liabilities and shareholders’ equity | $ (932,862) | $ (787,492) |
CONDENSED CONSOLIDATING STATEME
CONDENSED CONSOLIDATING STATEMENTS OF COMREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||||||||
Condensed Income Statements, Captions [Line Items] | ||||||||||||||||||||
Product sales | $ 308,089 | $ 323,611 | $ 321,284 | |||||||||||||||||
Service revenues | 38,091 | 51,485 | 66,533 | |||||||||||||||||
Net sales | $ 85,183 | $ 89,673 | $ 83,993 | $ 87,331 | $ 89,438 | $ 95,633 | $ 97,550 | $ 92,475 | 346,180 | 375,096 | 387,817 | |||||||||
Cost of product sales | 249,227 | 259,610 | 254,775 | |||||||||||||||||
Cost of service revenues | 37,150 | 46,700 | 57,672 | |||||||||||||||||
Cost of sales | 286,377 | 306,310 | 312,447 | |||||||||||||||||
Gross profit | 12,192 | [1] | 15,846 | 15,535 | 16,230 | 16,193 | [2] | 16,626 | [3] | 18,770 | 17,197 | 59,803 | 68,786 | 75,370 | ||||||
Selling, general and administrative expenses | 44,541 | 45,678 | 55,204 | |||||||||||||||||
Goodwill and intangible asset impairment | 28,368 | 0 | 26,439 | |||||||||||||||||
Restructuring expense | 1,212 | 2,322 | 2,585 | |||||||||||||||||
Goodwill and Intangible Asset Impairment | 28,368 | 28,368 | ||||||||||||||||||
(Loss) income from operations | (14,318) | [4] | 20,786 | (8,858) | [4] | |||||||||||||||
Interest expense | (21,171) | (22,439) | (29,280) | [5] | ||||||||||||||||
Other, net | (352) | (236) | 223 | |||||||||||||||||
Income (loss) from equity investments in subsidiaries | 0 | 0 | 0 | |||||||||||||||||
Total other expense | (21,523) | (22,675) | (29,057) | |||||||||||||||||
Loss before income taxes | (35,841) | (1,889) | (37,915) | |||||||||||||||||
(Benefit) provision for income taxes | (734) | 352 | (8,953) | |||||||||||||||||
Net loss | $ (3,757) | [1] | $ 309 | $ (29,900) | [6] | $ (1,759) | [7] | $ (1,188) | [2] | $ 34 | [3] | $ 378 | [8] | $ (1,465) | [9] | (35,107) | (2,241) | (28,962) | ||
Change in foreign currency translation adjustment | (71) | (41) | (98) | |||||||||||||||||
Reclassification adjustment for losses on interest rate hedges included in net earnings | 0 | 0 | 278 | |||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, $0 and $(157) | 278 | |||||||||||||||||||
Total comprehensive loss | (35,178) | (2,282) | (28,782) | |||||||||||||||||
LMIA(Guarantor Parent) | ||||||||||||||||||||
Condensed Income Statements, Captions [Line Items] | ||||||||||||||||||||
Product sales | (170) | 239 | 466 | |||||||||||||||||
Service revenues | 40,864 | 36,184 | 36,181 | |||||||||||||||||
Net sales | 40,694 | 36,423 | 36,647 | |||||||||||||||||
Cost of product sales | 86 | 248 | 699 | |||||||||||||||||
Cost of service revenues | 42,749 | 35,952 | 35,998 | |||||||||||||||||
Cost of sales | 42,835 | 36,200 | 36,697 | |||||||||||||||||
Gross profit | (2,141) | 223 | (50) | |||||||||||||||||
Selling, general and administrative expenses | 0 | 0 | 792 | |||||||||||||||||
Goodwill and intangible asset impairment | 0 | |||||||||||||||||||
Restructuring expense | 431 | 340 | 1,012 | |||||||||||||||||
Goodwill and Intangible Asset Impairment | 0 | |||||||||||||||||||
(Loss) income from operations | (2,572) | (117) | (1,854) | |||||||||||||||||
Interest expense | (20,336) | (21,449) | (28,224) | |||||||||||||||||
Other, net | 5 | 0 | 11 | |||||||||||||||||
Income (loss) from equity investments in subsidiaries | (12,275) | 19,284 | (8,860) | |||||||||||||||||
Total other expense | (32,606) | (2,165) | (37,073) | |||||||||||||||||
Loss before income taxes | (35,178) | (2,282) | (38,927) | |||||||||||||||||
(Benefit) provision for income taxes | 0 | 0 | (9,867) | |||||||||||||||||
Net loss | (35,178) | (2,282) | (29,060) | |||||||||||||||||
Change in foreign currency translation adjustment | 0 | 0 | 0 | |||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, $0 and $(157) | 278 | |||||||||||||||||||
Total comprehensive loss | (35,178) | (2,282) | (28,782) | |||||||||||||||||
Guarantor Subsidiaries | ||||||||||||||||||||
Condensed Income Statements, Captions [Line Items] | ||||||||||||||||||||
Product sales | 307,954 | 323,337 | 321,286 | |||||||||||||||||
Service revenues | 38,217 | 51,720 | 66,543 | |||||||||||||||||
Net sales | 346,171 | 375,057 | 387,829 | |||||||||||||||||
Cost of product sales | 248,836 | 259,327 | 254,544 | |||||||||||||||||
Cost of service revenues | 35,391 | 47,166 | 57,864 | |||||||||||||||||
Cost of sales | 284,227 | 306,493 | 312,408 | |||||||||||||||||
Gross profit | 61,944 | 68,564 | 75,421 | |||||||||||||||||
Selling, general and administrative expenses | 44,541 | 45,678 | 54,412 | |||||||||||||||||
Goodwill and intangible asset impairment | 26,439 | |||||||||||||||||||
Restructuring expense | 781 | 1,982 | 1,573 | |||||||||||||||||
Goodwill and Intangible Asset Impairment | 28,368 | |||||||||||||||||||
(Loss) income from operations | (11,746) | 20,904 | (7,003) | |||||||||||||||||
Interest expense | (835) | (990) | (1,056) | |||||||||||||||||
Other, net | (357) | (236) | 212 | |||||||||||||||||
Income (loss) from equity investments in subsidiaries | 0 | 0 | 0 | |||||||||||||||||
Total other expense | (1,192) | (1,226) | (844) | |||||||||||||||||
Loss before income taxes | (12,938) | 19,678 | (7,847) | |||||||||||||||||
(Benefit) provision for income taxes | (734) | 352 | 914 | |||||||||||||||||
Net loss | (12,204) | 19,326 | (8,761) | |||||||||||||||||
Change in foreign currency translation adjustment | (71) | (41) | (98) | |||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, $0 and $(157) | 0 | |||||||||||||||||||
Total comprehensive loss | (12,275) | 19,285 | (8,859) | |||||||||||||||||
Consolidating/Eliminating Entries | ||||||||||||||||||||
Condensed Income Statements, Captions [Line Items] | ||||||||||||||||||||
Product sales | 305 | 35 | (468) | |||||||||||||||||
Service revenues | (40,990) | (36,419) | (36,191) | |||||||||||||||||
Net sales | (40,685) | (36,384) | (36,659) | |||||||||||||||||
Cost of product sales | 305 | 35 | (468) | |||||||||||||||||
Cost of service revenues | (40,990) | (36,418) | (36,190) | |||||||||||||||||
Cost of sales | (40,685) | (36,383) | (36,658) | |||||||||||||||||
Gross profit | 0 | (1) | (1) | |||||||||||||||||
Selling, general and administrative expenses | 0 | 0 | 0 | |||||||||||||||||
Goodwill and intangible asset impairment | 0 | |||||||||||||||||||
Restructuring expense | 0 | 0 | 0 | |||||||||||||||||
Goodwill and Intangible Asset Impairment | 0 | |||||||||||||||||||
(Loss) income from operations | 0 | (1) | (1) | |||||||||||||||||
Interest expense | 0 | 0 | 0 | |||||||||||||||||
Other, net | 0 | 0 | 0 | |||||||||||||||||
Income (loss) from equity investments in subsidiaries | 12,275 | (19,284) | 8,860 | |||||||||||||||||
Total other expense | 12,275 | (19,284) | 8,860 | |||||||||||||||||
Loss before income taxes | 12,275 | (19,285) | 8,859 | |||||||||||||||||
(Benefit) provision for income taxes | 0 | 0 | 0 | |||||||||||||||||
Net loss | 12,275 | (19,285) | 8,859 | |||||||||||||||||
Change in foreign currency translation adjustment | 0 | 0 | 0 | |||||||||||||||||
Unrealized gain/(loss) arising during period from interest rate hedges, net of tax of $0, $0 and $(157) | 0 | |||||||||||||||||||
Total comprehensive loss | $ 12,275 | $ (19,285) | $ 8,859 | |||||||||||||||||
[1] | Gross profit in the fourth quarter of 2016 includes an unfavorable cumulative catch-up adjustment of $1,741 related to a long-term contract. | |||||||||||||||||||
[2] | Gross profit in the fourth quarter of 2015 includes an unfavorable cumulative catch-up adjustment of $1,010 related to a long-term contract. Net loss for the fourth quarter of 2015 also includes a restructuring benefit of $46. | |||||||||||||||||||
[3] | Gross profit in the third quarter of 2015 includes an unfavorable adjustment of $1,738 related to a long-term contract for which a forward loss reserve was established. Net income for the the third quarter of 2015 also included a net gain of $3,325 related to a legal settlement and $1,575 of restructuring expenses. | |||||||||||||||||||
[4] | Includes charges of $4,066 for intangible asset impairment and $24,302 for goodwill impairment in 2016. Includes charges of $26,439 for goodwill impairment in 2014. | |||||||||||||||||||
[5] | Includes $8,466 related to the write-off of deferred financing costs and $793 related to the settlement of debt derivatives associated with the Company's refinancing of its debt in 2014. | |||||||||||||||||||
[6] | Included in the net loss for the the second quarter of 2016 was a $28,368 charge for goodwill and intangible asset impairment related to the Engineering Services reporting unit and $241 of restructuring expenses. | |||||||||||||||||||
[7] | Included in the net loss for the the first quarter of 2016 were $947 of restructuring expenses. | |||||||||||||||||||
[8] | Included in the net income for the the second quarter of 2015 were $518 of restructuring expenses. | |||||||||||||||||||
[9] | Included in the net loss for the the first quarter of 2015 were $275 of restructuring expenses. |
CONDENSED CONSOLIDATING STATE76
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | [2] | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | [5] | Jun. 30, 2015 | [6] | Mar. 31, 2015 | Jun. 30, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||
Condensed Cash Flow Statements, Captions [Line Items] | |||||||||||||||||||
Net loss | $ (3,757) | [1] | $ 309 | $ (29,900) | $ (1,759) | [3] | $ (1,188) | [4] | $ 34 | $ 378 | $ (1,465) | [7] | $ (35,107) | $ (2,241) | $ (28,962) | ||||
Adjustments for non-cash items | 49,984 | 23,155 | 59,351 | ||||||||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | (326) | 11,448 | 18,728 | ||||||||||||||||
Intercompany activity | 0 | 0 | 0 | ||||||||||||||||
Net cash provided by operating activities | 14,551 | 32,362 | 49,117 | ||||||||||||||||
Additions to property, plant and equipment | (11,813) | (16,599) | (16,690) | ||||||||||||||||
Proceeds from sale of equipment | 639 | 285 | 3,579 | ||||||||||||||||
Net cash used by investing activities | (11,174) | (16,314) | (13,111) | ||||||||||||||||
Proceeds from issuance of debt | 1,465 | 0 | 250,000 | ||||||||||||||||
Principal payments on long-term debt and notes payable | (12,699) | (13,276) | (235,633) | ||||||||||||||||
Advances on revolving line of credit | 60,000 | 99,000 | 66,000 | ||||||||||||||||
Payments on revolving line of credit | (60,000) | (99,000) | (102,000) | ||||||||||||||||
Payments for debt issuance cost | $ (8,348) | (156) | (195) | (8,018) | |||||||||||||||
Net cash used by financing activities | (11,390) | (13,471) | (29,651) | ||||||||||||||||
Net (decrease) increase in cash and cash equivalents | (8,013) | 2,577 | 6,355 | ||||||||||||||||
Cash and cash equivalents, beginning of year | 10,504 | 7,927 | 10,504 | 7,927 | 1,572 | ||||||||||||||
Cash and cash equivalents, end of year | 2,491 | 10,504 | 2,491 | 10,504 | 7,927 | ||||||||||||||
LMIA(Guarantor Parent) | |||||||||||||||||||
Condensed Cash Flow Statements, Captions [Line Items] | |||||||||||||||||||
Net loss | (35,178) | (2,282) | (29,060) | ||||||||||||||||
Adjustments for non-cash items | 16,955 | (14,546) | 21,714 | ||||||||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | (1,566) | 10,420 | 19,977 | ||||||||||||||||
Intercompany activity | 24,800 | 22,874 | 17,663 | ||||||||||||||||
Net cash provided by operating activities | 5,011 | 16,466 | 30,294 | ||||||||||||||||
Additions to property, plant and equipment | (2,639) | (1,903) | (715) | ||||||||||||||||
Proceeds from sale of equipment | 0 | 0 | 2,558 | ||||||||||||||||
Net cash used by investing activities | (2,639) | (1,903) | 1,843 | ||||||||||||||||
Proceeds from issuance of debt | 0 | 250,000 | |||||||||||||||||
Principal payments on long-term debt and notes payable | (10,085) | (11,160) | (231,466) | ||||||||||||||||
Advances on revolving line of credit | 60,000 | 99,000 | 66,000 | ||||||||||||||||
Payments on revolving line of credit | (60,000) | (99,000) | (102,000) | ||||||||||||||||
Payments for debt issuance cost | (156) | (210) | (8,018) | ||||||||||||||||
Net cash used by financing activities | (10,241) | (11,370) | (25,484) | ||||||||||||||||
Net (decrease) increase in cash and cash equivalents | (7,869) | 3,193 | 6,653 | ||||||||||||||||
Cash and cash equivalents, beginning of year | 10,251 | 7,058 | 10,251 | 7,058 | 405 | ||||||||||||||
Cash and cash equivalents, end of year | 2,382 | 10,251 | 2,382 | 10,251 | 7,058 | ||||||||||||||
Guarantor Subsidiaries | |||||||||||||||||||
Condensed Cash Flow Statements, Captions [Line Items] | |||||||||||||||||||
Net loss | (12,204) | 19,326 | (8,761) | ||||||||||||||||
Adjustments for non-cash items | 45,304 | 18,416 | 46,496 | ||||||||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | 1,240 | 1,028 | (1,249) | ||||||||||||||||
Intercompany activity | (24,800) | (22,874) | (17,663) | ||||||||||||||||
Net cash provided by operating activities | 9,540 | 15,896 | 18,823 | ||||||||||||||||
Additions to property, plant and equipment | (9,174) | (14,696) | (15,975) | ||||||||||||||||
Proceeds from sale of equipment | 639 | 285 | 1,021 | ||||||||||||||||
Net cash used by investing activities | (8,535) | (14,411) | (14,954) | ||||||||||||||||
Proceeds from issuance of debt | 1,465 | 0 | |||||||||||||||||
Principal payments on long-term debt and notes payable | (2,614) | (2,116) | (4,167) | ||||||||||||||||
Advances on revolving line of credit | 0 | 0 | 0 | ||||||||||||||||
Payments on revolving line of credit | 0 | 0 | 0 | ||||||||||||||||
Payments for debt issuance cost | 0 | 15 | 0 | ||||||||||||||||
Net cash used by financing activities | (1,149) | (2,101) | (4,167) | ||||||||||||||||
Net (decrease) increase in cash and cash equivalents | (144) | (616) | (298) | ||||||||||||||||
Cash and cash equivalents, beginning of year | 253 | 869 | 253 | 869 | 1,167 | ||||||||||||||
Cash and cash equivalents, end of year | 109 | 253 | 109 | 253 | 869 | ||||||||||||||
Consolidating/Eliminating Entries | |||||||||||||||||||
Condensed Cash Flow Statements, Captions [Line Items] | |||||||||||||||||||
Net loss | 12,275 | (19,285) | 8,859 | ||||||||||||||||
Adjustments for non-cash items | (12,275) | 19,285 | (8,859) | ||||||||||||||||
Net changes in operating assets and liabilities, net of acquired businesses | 0 | 0 | 0 | ||||||||||||||||
Intercompany activity | 0 | 0 | 0 | ||||||||||||||||
Net cash provided by operating activities | 0 | 0 | 0 | ||||||||||||||||
Additions to property, plant and equipment | 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 | |||||||||||||||||
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 | ||||||||||||||||
Net cash used by financing activities | 0 | 0 | 0 | ||||||||||||||||
Net (decrease) increase in cash and cash equivalents | 0 | 0 | 0 | ||||||||||||||||
Cash and cash equivalents, beginning of year | $ 0 | $ 0 | 0 | 0 | 0 | ||||||||||||||
Cash and cash equivalents, end of year | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||||||||||||||
[1] | Gross profit in the fourth quarter of 2016 includes an unfavorable cumulative catch-up adjustment of $1,741 related to a long-term contract. | ||||||||||||||||||
[2] | Included in the net loss for the the second quarter of 2016 was a $28,368 charge for goodwill and intangible asset impairment related to the Engineering Services reporting unit and $241 of restructuring expenses. | ||||||||||||||||||
[3] | Included in the net loss for the the first quarter of 2016 were $947 of restructuring expenses. | ||||||||||||||||||
[4] | Gross profit in the fourth quarter of 2015 includes an unfavorable cumulative catch-up adjustment of $1,010 related to a long-term contract. Net loss for the fourth quarter of 2015 also includes a restructuring benefit of $46. | ||||||||||||||||||
[5] | Gross profit in the third quarter of 2015 includes an unfavorable adjustment of $1,738 related to a long-term contract for which a forward loss reserve was established. Net income for the the third quarter of 2015 also included a net gain of $3,325 related to a legal settlement and $1,575 of restructuring expenses. | ||||||||||||||||||
[6] | Included in the net income for the the second quarter of 2015 were $518 of restructuring expenses. | ||||||||||||||||||
[7] | Included in the net loss for the the first quarter of 2015 were $275 of restructuring expenses. |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Thousands | Dec. 31, 2016USD ($)$ / shares |
Subsequent Event [Line Items] | |
Business Acquisition, Share Price | $ / shares | $ 14 |
Minimum [Member] | |
Subsequent Event [Line Items] | |
Termination Fee Payable if Merger Not Completed | $ 10,000 |
Maximum [Member] | |
Subsequent Event [Line Items] | |
Termination Fee Payable if Merger Not Completed | $ 15,000 |
SCHEDULE II VALUATION AND QUA78
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||
Reserve for Accounts Receivable [Member] | ||||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||||
Beginning Balance | $ 246 | $ 464 | $ 180 | |||
Charge to Cost/Expense | 116 | 53 | 309 | |||
Other Charge to Cost/Expense | 0 | 0 | 0 | |||
Write-offs net of Recoveries | (14) | (271) | (25) | |||
Ending Balance | 348 | 246 | 464 | |||
Valuation Allowance of Deferred Tax Assets [Member] | ||||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||||
Beginning Balance | 14,641 | 12,676 | 18,137 | |||
Charge to Cost/Expense | 6,386 | [1] | 1,965 | [1] | 0 | |
Other Charge to Cost/Expense | 0 | 0 | 5,461 | [2] | ||
Write-offs net of Recoveries | 0 | 0 | 0 | |||
Ending Balance | $ 21,027 | $ 14,641 | $ 12,676 | |||
[1] | Expected net operating losses on federal and state income tax returns resulted in increases in the income tax valuation allowance. | |||||
[2] | Favorable adjustment of $5,461 resulted from the Company's decision to carry back the 2013 net operating tax loss to prior years. |