Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Sep. 30, 2015 | Oct. 31, 2015 | Mar. 31, 2014 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | CABOT MICROELECTRONICS CORP | ||
Entity Central Index Key | 1,102,934 | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 1,206,403,000 | ||
Entity Common Stock, Shares Outstanding | 24,456,503 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Sep. 30, 2015 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
CONSOLIDATED STATEMENTS OF INCOME [Abstract] | |||||||||||
Revenue | $ 100,137 | $ 97,168 | $ 104,858 | $ 111,934 | $ 116,337 | $ 108,358 | $ 99,456 | $ 100,515 | $ 414,097 | $ 424,666 | $ 433,131 |
Cost of goods sold | 48,115 | 48,609 | 50,182 | 54,960 | 59,209 | 56,632 | 52,931 | 52,801 | 201,866 | 221,573 | 221,015 |
Gross profit | 52,022 | 48,559 | 54,676 | 56,974 | 57,128 | 51,726 | 46,525 | 47,714 | 212,231 | 203,093 | 212,116 |
Operating expenses: | |||||||||||
Research, development and technical | 14,856 | 14,773 | 15,131 | 15,018 | 15,051 | 15,368 | 14,364 | 14,571 | 59,778 | 59,354 | 61,373 |
Selling and marketing | 5,763 | 5,804 | 5,777 | 7,639 | 6,846 | 6,489 | 6,471 | 6,707 | 24,983 | 26,513 | 27,985 |
General and administrative | 13,553 | 12,830 | 14,296 | 11,751 | 12,236 | 11,380 | 11,076 | 10,726 | 52,430 | 45,418 | 46,287 |
Total operating expenses | 34,172 | 33,407 | 35,204 | 34,408 | 34,133 | 33,237 | 31,911 | 32,004 | 137,191 | 131,285 | 135,645 |
Operating income | 17,850 | 15,152 | 19,472 | 22,566 | 22,995 | 18,489 | 14,614 | 15,710 | 75,040 | 71,808 | 76,471 |
Interest expense | 1,494 | 1,065 | 1,059 | 906 | 807 | 832 | 843 | 872 | 4,524 | 3,354 | 3,643 |
Total other income, net | 116 | (160) | (332) | 1,057 | (448) | (132) | 103 | 617 | 681 | 140 | 1,392 |
Income before income taxes | 16,472 | 13,927 | 18,081 | 22,717 | 21,740 | 17,525 | 13,874 | 15,455 | 71,197 | 68,594 | 74,220 |
Provision for income taxes | 3,939 | 4,041 | 4,270 | 2,801 | 5,694 | 4,223 | 3,779 | 4,147 | 15,051 | 17,843 | 21,642 |
Net income | $ 12,533 | $ 9,886 | $ 13,811 | $ 19,916 | $ 16,046 | $ 13,302 | $ 10,095 | $ 11,308 | $ 56,146 | $ 50,751 | $ 52,578 |
Basic earnings per share (in dollars per share) | $ 0.51 | $ 0.40 | $ 0.57 | $ 0.83 | $ 0.67 | $ 0.55 | $ 0.42 | $ 0.47 | $ 2.32 | $ 2.12 | $ 2.27 |
Weighted-average basic shares outstanding (in shares) | 24,144,000 | 24,333,000 | 24,057,000 | 23,651,000 | 23,500,000 | 23,753,000 | 23,982,000 | 23,590,000 | 24,039,692 | 23,704,024 | 22,924,056 |
Diluted earnings per share (in dollars per share) | $ 0.50 | $ 0.39 | $ 0.55 | $ 0.80 | $ 0.65 | $ 0.53 | $ 0.40 | $ 0.45 | $ 2.26 | $ 2.04 | $ 2.19 |
Weighted-average diluted shares outstanding (in shares) | 24,583,000 | 24,813,000 | 24,693,000 | 24,486,000 | 24,334,000 | 24,613,000 | 24,897,000 | 24,623,000 | 24,631,815 | 24,610,908 | 23,760,066 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract] | |||
Net income | $ 56,146 | $ 50,751 | $ 52,578 |
Other comprehensive income (loss), net of tax | |||
Foreign currency translation adjustments | (14,126) | (8,136) | (13,037) |
Minimum pension liability adjustment | (318) | (196) | 7 |
Net unrealized loss on cash flow hedges | (901) | 0 | 0 |
Unrealized gain on investments | 0 | 151 | 0 |
Other comprehensive loss, net of tax | (15,345) | (8,181) | (13,030) |
Comprehensive income | $ 40,801 | $ 42,570 | $ 39,548 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 354,190 | $ 284,155 |
Accounts receivable, less allowance for doubtful accounts of $1,224 at September 30, 2015, and $1,392 at September 30, 2014 | 49,405 | 60,693 |
Inventories | 70,678 | 64,979 |
Prepaid expenses and other current assets | 12,840 | 10,645 |
Deferred income taxes | 7,395 | 7,521 |
Total current assets | 494,508 | 427,993 |
Property, plant and equipment, net | 93,743 | 100,821 |
Goodwill | 40,442 | 43,245 |
Other intangible assets, net | 4,565 | 7,163 |
Deferred income taxes | 12,212 | 11,353 |
Other long-term assets | 15,004 | 10,592 |
Total assets | 660,474 | 601,167 |
Current liabilities: | ||
Accounts payable | 15,448 | 15,304 |
Current portion of long-term debt | 8,750 | 8,750 |
Accrued expenses, income taxes payable and other current liabilities | 36,446 | 31,394 |
Total current liabilities | 60,644 | 55,448 |
Long-term debt, net of current portion | 155,313 | 164,063 |
Deferred income taxes | 76 | 510 |
Other long-term liabilities | 15,477 | 9,144 |
Total liabilities | $ 231,510 | $ 229,165 |
Commitments and contingencies (Note 17) | ||
Stockholders' equity: | ||
Common Stock: Authorized: 200,000,000 shares, $0.001 par value; Issued: 33,489,181 shares at September 30, 2015, and 31,927,601 shares at September 30, 2014 | $ 33 | $ 32 |
Capital in excess of par value of common stock | 495,673 | 437,266 |
Retained earnings | 284,088 | 227,942 |
Accumulated other comprehensive income (loss) | (6,090) | 9,255 |
Treasury stock at cost, 9,041,678 shares at September 30, 2015, and 8,142,687 shares at September 30, 2014 | (344,740) | (302,493) |
Total stockholders' equity | 428,964 | 372,002 |
Total liabilities and stockholders' equity | $ 660,474 | $ 601,167 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Current assets: | ||
Allowance for doubtful accounts | $ 1,224 | $ 1,392 |
Stockholders' equity: | ||
Common stock: Authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock: par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock: Issued (in shares) | 33,489,181 | 31,927,601 |
Treasury stock at cost (in shares) | 9,041,678 | 8,142,687 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Cash flows from operating activities: | |||
Net income | $ 56,146 | $ 50,751 | $ 52,578 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 18,719 | 19,941 | 20,457 |
Provision for doubtful accounts | (84) | (170) | 173 |
Share-based compensation expense | 16,445 | 14,042 | 13,350 |
Deferred income tax expense (benefit) | 869 | (700) | (4,722) |
Non-cash foreign exchange loss | 1,391 | 943 | 3,832 |
(Gain)/Loss on disposal of property, plant and equipment | (28) | (51) | 551 |
Impairment of long-lived assets | 0 | 2,320 | 160 |
Other | (524) | (724) | (1,400) |
Changes in operating assets and liabilities: | |||
Accounts receivable | 9,013 | (8,181) | (5,936) |
Inventories | (8,290) | (3,794) | (1,683) |
Prepaid expenses and other assets | (3,662) | 576 | (3,471) |
Accounts payable | 801 | (850) | (1,359) |
Accrued expenses, income taxes payable and other liabilities | 7,390 | (6,625) | 12,953 |
Net cash provided by operating activities | 98,186 | 67,478 | 85,483 |
Cash flows from investing activities: | |||
Additions to property, plant and equipment | (13,812) | (12,551) | (14,633) |
Proceeds from the sale of property, plant and equipment | 201 | 202 | 20 |
Proceeds from the sale of investments | 202 | 2,305 | 25 |
Other investing activities | 0 | 1,062 | 0 |
Net cash used in investing activities | (13,409) | (8,982) | (14,588) |
Cash flows from financing activities: | |||
Issuance of long-term debt | 0 | 17,500 | 0 |
Repayment of long-term debt | (8,750) | (6,562) | (10,937) |
Repurchases of common stock | (42,247) | (55,072) | (41,294) |
Net proceeds from issuance of stock | 35,782 | 43,070 | 30,905 |
Debt issuance costs | 0 | (550) | 0 |
Tax benefits associated with share-based compensation expense | 6,207 | 2,806 | 1,148 |
Principal payments under capital lease obligations | 0 | 0 | (21) |
Net cash provided by (used in) financing activities | (9,008) | 1,192 | (20,199) |
Effect of exchange rate changes on cash | (5,734) | (1,562) | (3,126) |
Increase in cash | 70,035 | 58,126 | 47,570 |
Cash and cash equivalents at beginning of year | 284,155 | 226,029 | 178,459 |
Cash and cash equivalents at end of year | 354,190 | 284,155 | 226,029 |
Supplemental disclosure of cash flow information: | |||
Cash paid for income taxes | 8,543 | 18,041 | 17,661 |
Cash paid for interest | 4,107 | 3,355 | 3,643 |
Supplemental disclosure of non-cash investing and financing activities: | |||
Purchases of property, plant and equipment in accrued liabilities and accounts payable at the end of period | $ 1,503 | $ 1,267 | $ 1,232 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY - USD ($) $ in Thousands | Total | Common Stock [Member] | Capital in Excess Of Par [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income [Member] | Treasury Stock [Member] |
Balance at Sep. 30, 2012 | $ 279,538 | $ 29 | $ 330,557 | $ 124,613 | $ 30,466 | $ (206,127) |
Share-based compensation expense | 13,350 | 13,350 | ||||
Repurchases of common stock under share repurchase plans, at cost | (40,000) | (40,000) | ||||
Repurchases of common stock - other, at cost | (1,294) | (1,294) | ||||
Exercise of stock options | 28,526 | 1 | 28,525 | |||
Issuance of Cabot Microelectronics restricted stock under Deposit Share Plan | 154 | 154 | ||||
Issuance of Cabot Microelectronics stock under Employee Stock Purchase Plan | 2,226 | 2,226 | ||||
Tax benefits from share-based compensation plans | 1,394 | 1,394 | ||||
Net income | 52,578 | 52,578 | ||||
Net unrealized gain on marketable securities | 0 | |||||
Foreign currency translation adjustment | (13,037) | (13,037) | ||||
Net unrealized loss on cash flow hedges | 0 | |||||
Minimum pension liability adjustment | 7 | 7 | ||||
Balance at Sep. 30, 2013 | 323,442 | 30 | 376,206 | 177,191 | 17,436 | (247,421) |
Share-based compensation expense | 14,042 | 14,042 | ||||
Repurchases of common stock under share repurchase plans, at cost | (53,000) | (53,000) | ||||
Repurchases of common stock - other, at cost | (2,072) | (2,072) | ||||
Exercise of stock options | 40,248 | 2 | 40,246 | |||
Issuance of Cabot Microelectronics restricted stock under Deposit Share Plan | 210 | 210 | ||||
Issuance of Cabot Microelectronics stock under Employee Stock Purchase Plan | 2,612 | 2,612 | ||||
Tax benefits from share-based compensation plans | 3,950 | 3,950 | ||||
Net income | 50,751 | 50,751 | ||||
Net unrealized gain on marketable securities | 151 | 151 | ||||
Foreign currency translation adjustment | (8,136) | (8,136) | ||||
Net unrealized loss on cash flow hedges | 0 | |||||
Minimum pension liability adjustment | (196) | (196) | ||||
Balance at Sep. 30, 2014 | 372,002 | 32 | 437,266 | 227,942 | 9,255 | (302,493) |
Share-based compensation expense | 16,445 | 16,445 | ||||
Repurchases of common stock under share repurchase plans, at cost | (40,026) | (40,026) | ||||
Repurchases of common stock - other, at cost | (2,221) | (2,221) | ||||
Exercise of stock options | 33,176 | 1 | 33,175 | |||
Issuance of Cabot Microelectronics restricted stock under Deposit Share Plan | 23 | 23 | ||||
Issuance of Cabot Microelectronics stock under Employee Stock Purchase Plan | 2,583 | 2,583 | ||||
Tax benefits from share-based compensation plans | 6,181 | 6,181 | ||||
Net income | 56,146 | 56,146 | ||||
Net unrealized gain on marketable securities | 0 | |||||
Foreign currency translation adjustment | (14,126) | (14,126) | ||||
Net unrealized loss on cash flow hedges | (901) | (901) | ||||
Minimum pension liability adjustment | (318) | (318) | ||||
Balance at Sep. 30, 2015 | $ 428,964 | $ 33 | $ 495,673 | $ 284,088 | $ (6,090) | $ (344,740) |
BACKGROUND AND BASIS OF PRESENT
BACKGROUND AND BASIS OF PRESENTATION | 12 Months Ended |
Sep. 30, 2015 | |
BACKGROUND AND BASIS OF PRESENTATION [Abstract] | |
BACKGROUND AND BASIS OF PRESENTATION | 1. BACKGROUND AND BASIS OF PRESENTATION Cabot Microelectronics Corporation ("Cabot Microelectronics'', "the Company'', "us'', "we'' or "our'') supplies high-performance polishing slurries and pads used in the manufacture of advanced integrated circuit (IC) devices within the semiconductor industry, in a process called chemical mechanical planarization (CMP). CMP is a polishing process used by IC device manufacturers to planarize or flatten many of the multiple layers of material that are deposited upon silicon wafers in the production of advanced ICs. Our products play a critical role in the production of advanced IC devices, thereby enabling our customers to produce smaller, faster and more complex IC devices with fewer defects. We develop, produce and sell CMP slurries for polishing many of the conducting and insulating materials used in IC devices, and also for polishing the disk substrates and magnetic heads used in hard disk drives. We also develop, manufacture and sell CMP polishing pads, which are used in conjunction with slurries in the CMP process. In addition, we pursue other demanding surface modification applications through our Engineered Surface Finishes (ESF) business where we believe we can leverage our expertise in CMP consumables for the semiconductor industry to develop products for polishing applications in other industries. The audited consolidated financial statements have been prepared by us pursuant to the rules of the Securities and Exchange Commission (SEC) and accounting principles generally accepted in the United States of America. We operate predominantly in one reportable segment - the development, manufacture, and sale of CMP consumables. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Sep. 30, 2015 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of Cabot Microelectronics and its subsidiaries. All intercompany transactions and balances between the companies have been eliminated as of September 30, 2015. USE OF ESTIMATES The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make judgments, assumptions and estimates that affect the amounts reported in the consolidated financial statements and accompanying notes. The accounting estimates that require management's most difficult and subjective judgments include, but are not limited to, those estimates related to bad debt expense, warranty obligations, inventory valuation, valuation and classification of auction rate securities, impairment of long-lived assets and investments, business combinations, goodwill, other intangible assets, interest rate swaps, share-based compensation, income taxes and contingencies. We base our estimates on historical experience, current conditions and on various other assumptions that we believe are reasonable under the circumstances. However, future events are subject to change and estimates and judgments routinely require adjustment. Actual results may differ from these estimates under different assumptions or conditions. CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS We consider investments in all highly liquid financial instruments with original maturities of three months or less to be cash equivalents. Short-term investments include securities generally having maturities of 90 days to one year. We did not own any securities that were considered short-term as of September 30, 2015 or 2014. See Note 3 for a more detailed discussion of other financial instruments. ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS Trade accounts receivable are recorded at the invoiced amount and do not bear interest. We maintain an allowance for doubtful accounts for estimated losses resulting from the potential inability of our customers to make required payments. Our allowance for doubtful accounts is based on historical collection experience, adjusted for any specific known conditions or circumstances such as customer bankruptcies and increased risk due to economic conditions. Uncollectible account balances are charged against the allowance when we believe that it is probable that the receivable will not be recovered. Accounts receivable, net of allowances for doubtful accounts, were $49,405 as of September 30, 2015 and $60,693 as of September 30, 2014. The decrease in accounts receivable was primarily due to the 13.9% decrease in revenue in the fourth quarter of fiscal 2015 compared to the same period in fiscal 2014. Amounts charged to bad debt expense are recorded in general and administrative expenses. A portion of our receivables and the related allowance for doubtful accounts is denominated in foreign currencies, so they are subject to foreign exchange fluctuations which are included in the table below under deductions and adjustments. Our allowance for doubtful accounts changed during the fiscal year ended September 30, 2015 as follows: Balance as of September 30, 2014 $ 1,392 Amounts charged to expense (84 ) Deductions and adjustments (84 ) Balance as of September 30, 2015 $ 1,224 CONCENTRATION OF CREDIT RISK Financial instruments that subject us to concentrations of credit risk consist principally of accounts receivable. We perform ongoing credit evaluations of our customers' financial conditions and generally do not require collateral to secure accounts receivable. Our exposure to credit risk associated with nonpayment is affected principally by conditions or occurrences within the semiconductor industry and global economy. With the exception of one customer bankruptcy in fiscal 2012, we have not experienced significant losses relating to accounts receivable from individual customers or groups of customers. Customers who represented more than 10% of revenue are as follows: Year Ended September 30, 2015 2014 2013 Taiwan Semiconductor Manufacturing Co. (TSMC) 18% 22% 21% Samsung Group (Samsung) 15% 14% 13% TSMC accounted for 12.6% and 19.4% of net accounts receivable at September 30, 2015 and 2014, respectively. Samsung accounted for 9.7% and 10.2% of net accounts receivable at September 30, 2015 and 2014, respectively. FAIR VALUES OF FINANCIAL INSTRUMENTS The recorded amounts of cash, accounts receivable, and accounts payable approximate their fair values due to their short-term, highly liquid characteristics. See Note 3 for a more detailed discussion of the fair value of financial instruments. INVENTORIES Inventories are stated at the lower of cost, determined on the first-in, first-out (FIFO) basis, or market. Finished goods and work in process inventories include material, labor and manufacturing overhead costs. We regularly review and write down the value of inventory as required for estimated obsolescence or lack of marketability. An inventory reserve is maintained based upon a historical percentage of actual inventories written off and applied against inventory value at the end of the period, adjusted for known conditions and circumstances. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are recorded at cost. Depreciation is based on the following estimated useful lives of the assets using the straight-line method: Buildings 15-25 years Machinery and equipment 3-10 years Furniture and fixtures 5-10 years Information systems 3-5 years Expenditures for repairs and maintenance are charged to expense as incurred. Expenditures for major renewals and betterments are capitalized and depreciated over the remaining useful lives. As assets are retired or sold, the related cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations. We capitalize the costs related to the design and development of software used for internal purposes; however, these costs are not material. IMPAIRMENT OF LONG-LIVED ASSETS Reviews are regularly performed to determine whether facts and circumstances exist that indicate the carrying amount of assets may not be recoverable or the useful life is shorter than originally estimated. Asset recoverability assessment begins by comparing the projected undiscounted cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Impairment, if any, is based on the excess of the carrying amount over the fair value of those assets. If assets are determined to be recoverable, but their useful lives are shorter than originally estimated, the net book value of the asset is depreciated over the newly determined remaining useful life. See Note 5 for more information regarding impairment expense recorded in fiscal years 2015, 2014 and 2013. GOODWILL AND INTANGIBLE ASSETS We amortize intangible assets with finite lives over their estimated useful lives, which range from one to ten years. Intangible assets with finite lives are reviewed for impairment using a process similar to that used to evaluate other long-lived assets. Goodwill and indefinite-lived intangible assets are not amortized and are tested annually in the fourth fiscal quarter, or more frequently if indicators of potential impairment exist, using a fair-value-based approach. The recoverability of goodwill is measured at the reporting unit level, which is defined as either an operating segment or one level below an operating segment, referred to as a component. A component is a reporting unit when the component constitutes a business for which discreet financial information is available and segment management regularly reviews the operating results of the component. Components may be combined into one reporting unit when they have similar economic characteristics. We have four reporting units, three of which have goodwill and intangible assets as of September 30, 2015. Goodwill impairment testing requires a comparison of the fair value of each reporting unit to the carrying value. If the carrying value exceeds fair value, then the fair value of the assets and liabilities for the reporting unit is used to determine the "implied" fair value of goodwill. The amount of the impairment is the difference between the carrying value and the implied fair value of goodwill. The fair value of the reporting unit may be determined using a discounted cash flow analysis of our projected future results. An entity has the option to assess qualitative factors to determine if the two-step impairment test must be performed. We elected to perform a discounted cash flow analysis in fiscal 2015 when we performed our annual impairment review of goodwill. An entity also has the option to assess qualitative factors in its impairment review of indefinite-lived intangible assets. However, we elected to use the royalty savings method in fiscal 2015 when we performed our impairment review of our indefinite-lived intangible assets. We determined that goodwill and other intangible assets were not impaired as of September 30, 2015, as the fair value of our reporting units was substantially in excess of carrying value. WARRANTY RESERVE We maintain a warranty reserve that reflects management's best estimate of the cost to replace product that does not meet our specifications and customers' performance requirements. The warranty reserve is based upon a historical product return rate, adjusted for any specific known conditions or circumstances. Adjustments to the warranty reserve are recorded in cost of goods sold. FOREIGN CURRENCY TRANSLATION Certain operating activities in Asia and Europe are denominated in local currency, considered to be the functional currency. Assets and liabilities of these operations are translated using exchange rates in effect at the end of the year, and revenue and costs are translated using average exchange rates for the year. The related translation adjustments are reported in comprehensive income in stockholders' equity. FOREIGN EXCHANGE MANAGEMENT We transact business in various foreign currencies, primarily the Japanese yen, New Taiwan dollar and Korean won. Our exposure to foreign currency exchange risks has not been significant because a large portion of our business is denominated in U.S. dollars. However, there was a weakening of the Japanese yen against the U.S. dollar during fiscal years 2013, 2014 and 2015, which had some net positive impact on our gross margin percentage and our net income. Periodically, we enter into forward foreign exchange contracts in an effort to mitigate the risks associated with currency fluctuations on certain foreign currency balance sheet exposures. Our foreign exchange contracts do not qualify for hedge accounting under the accounting rules for derivative instruments. See Note 10 for a discussion of derivative financial instruments. INTERCOMPANY LOAN ACCOUNTING We maintain an intercompany loan agreement with our wholly-owned subsidiary, Nihon Cabot Microelectronics K.K. ("Nihon"), under which we provided funds to Nihon to finance the purchase of certain assets from our former Japanese branch at the time of the establishment of this subsidiary, for the purchase of land adjacent to our Geino, Japan, facility, for the construction of our Asia Pacific technology center, and for the purchase of a 300 millimeter polishing tool and related metrology equipment, all of which are part of Nihon, as well as for general business purposes. Since settlement of the note is expected in the foreseeable future, and our subsidiary has been consistently making timely payments on the loan, the loan is considered a foreign-currency transaction. Therefore the associated foreign exchange gains and losses are recognized as other income or expense rather than being deferred in the cumulative translation account in other comprehensive income. We also maintain an intercompany loan between two of our wholly-owned foreign subsidiaries, from Cabot Microelectronics Singapore Pte. Ltd. to Hanguk Cabot Microelectronics, LLC in South Korea. This loan provided funds for the construction and operation of our research, development and manufacturing facility in South Korea. This loan is also considered a foreign currency transaction and is accounted for in the same manner as our intercompany loan to Nihon. PURCHASE COMMITMENTS We have entered into unconditional purchase obligations, which include noncancelable purchase commitments and take-or-pay arrangements with suppliers. On an ongoing basis, we review our agreements and assess the likelihood of a shortfall in purchases and determine if it is necessary to record a liability. To date, we have not recorded such a liability. REVENUE RECOGNITION Revenue from CMP consumables products is recognized when title is transferred to the customer, assuming all revenue recognition criteria are met. Title transfer generally occurs upon shipment to the customer or when inventory held on consignment is consumed by the customer, subject to the terms and conditions of the particular customer arrangement. We have consignment agreements with a number of our customers that require, at a minimum, monthly consumption reports that enable us to record revenue and inventory usage in the appropriate period. Although the vast majority of our products are sold directly, we market some of our products through distributors in certain areas of the world. We recognize revenue upon shipment and when title is transferred to the distributor. We do not have any arrangements with distributors that include payment terms, rights of return, or rights of exchange outside the ordinary course of business, or any other significant matters that we believe would impact the timing of revenue recognition. Within our Engineered Surface Finishes (ESF) business, sales of equipment are recorded as revenue upon delivery and customer acceptance. Amounts allocated to installation and training are deferred until those services are provided and are not material. Revenues are reported net of any value-added tax or other such tax assessed by a governmental authority on our revenue-producing activities. SHIPPING AND HANDLING Costs related to shipping and handling are included in cost of goods sold. RESEARCH, DEVELOPMENT AND TECHNICAL Research, development and technical costs are expensed as incurred and consist primarily of staffing costs, materials and supplies, depreciation, utilities and other facilities costs. INCOME TAXES Current income taxes are determined based on estimated taxes payable or refundable on tax returns for the current year. Deferred income taxes are determined using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Provisions are made for both U.S. and any foreign deferred income tax liability or benefit. We assess whether our deferred tax assets will ultimately be realized and record an estimated valuation allowance on those deferred tax assets that may not be realized. We recognize the tax benefit of an uncertain tax position only if it is more likely than not that the tax position will be sustained by the taxing authorities, based on the technical merits of the position. In fiscal 2012, we elected to permanently reinvest the earnings of certain of our foreign subsidiaries outside the U.S. rather than repatriate the earnings to the U.S. In fiscal years 2013, 2014 and 2015, we elected to permanently reinvest the earnings of all of our foreign subsidiaries. See Note 16 for additional information on income taxes. INTEREST RATE SWAPS In the first quarter of fiscal 2015, we entered into floating-to-fixed interest rate swap agreements to hedge the variability in LIBOR-based interest payments on a portion of our outstanding variable rate debt. The fair value of our interest rate swaps is estimated using standard valuation models using market-based observable inputs over the contractual term, including one-month LIBOR-based yield curves, among others. We consider the risk of nonperformance, including counterparty credit risk, in the calculation of the fair value. We have designated these swap agreements as cash flow hedges pursuant to ASC 815, "Derivatives and Hedging". As cash flow hedges, unrealized gains are recognized as assets and unrealized losses are recognized as liabilities. Unrealized gains and losses are designated as effective or ineffective based on a comparison of the changes in fair value of the interest rate swaps and changes in fair value of the underlying exposures being hedged. The effective portion is recorded as a component of accumulated other comprehensive income or loss, while the ineffective portion is recorded as a component of interest expense. Changes in the method by which we pay interest from one-month LIBOR to another rate of interest could create ineffectiveness in the swaps, and result in amounts being reclassified from other comprehensive income into net income. Hedge effectiveness is tested quarterly to determine if hedge treatment is appropriate. SHARE-BASED COMPENSATION We record share-based compensation expense for all share-based awards, including stock option grants, restricted stock and restricted stock unit awards and employee stock purchase plan purchases. We calculate share-based compensation expense using the straight-line approach based on awards ultimately expected to vest, which requires the use of an estimated forfeiture rate. Our estimated forfeiture rate is primarily based on historical experience, and is revised from time-to-time when actual forfeitures differ from the estimate. We use the Black-Scholes option-pricing model to estimate the grant date fair value of our stock options and employee stock purchase plan purchases. This model requires the input of highly subjective assumptions, including the price volatility of the underlying stock, the expected term of our stock options and the risk-free interest rate. We estimate the expected volatility of our stock options based on a combination of our stock's historical volatility and the implied volatilities from actively-traded options on our stock. We calculate the expected term of our stock options using historical stock option exercise data, and we add a premium to this expected term for employees who meet the definition of retirement eligible pursuant to their grants during the contractual term of the grant. The risk-free rate is derived from the U.S. Treasury yield curve in effect at the time of grant. The fair value of our restricted stock and restricted stock unit awards represents the closing price of our common stock on the date of award. For additional information regarding our share-based compensation plans, refer to Note 12. EARNINGS PER SHARE Basic earnings per share (EPS) is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period, excluding the effects of unvested restricted stock awards with a right to receive non-forfeitable dividends, which are considered participating securities as prescribed by the two class method under ASC Topic 260, Earnings Per Share (ASC 260). Diluted EPS is calculated in a similar manner, but the weighted-average number of common shares outstanding during the period is increased to include the weighted-average dilutive effect of "in-the-money" stock options and unvested restricted stock shares using the treasury stock method. COMPREHENSIVE INCOME Comprehensive income primarily differs from net income due to foreign currency translation adjustments. EFFECTS OF RECENT ACCOUNTING PRONOUNCEMENTS In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers" (Topic 606), an updated standard on revenue recognition . In June 2014, the FASB issued ASU No. 2014-12, "Accounting for Share-Based Payments When the Terms of an Award Provide that a Performance Target Could be Achieved after the Requisite Service Period" (Topic 718) . In January 2015, the FASB issued ASU No. 2015-01, "Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items" (Subtopic 225-20) . In February 2015, the FASB issued ASU No. 2015-02, "Amendments to the Consolidation Analysis" (Topic 810) . In April 2015, the FASB issued ASU No. 2015-03, "Simplifying the Presentation of Debt Issuance Costs" (Subtopic 835-30). The provisions of ASU 2015-03 require an entity to present the debt issuance costs related to a recognized debt liability in the balance sheet as a direct deduction to the carry amount of that debt liability. ASU 2015-03 will be effective for us beginning October 1, 2016, but early adoption is permitted. The implementation of this standard will require us to reclassify our debt issuance costs from their asset position on our balance sheet to a liability position as an offset to the carrying amount of our outstanding debt. We are considering early adoption of ASU 2015-03 in fiscal 2016; the implementation is not expected to have a material effect on our financial statements. In April 2015, the FASB issued ASU No. 2015-05, "Customer Accounting for Fees Paid in a Cloud Computing Arrangement" (Subtopic 350-40). ASU 2015-05 provides guidance to entities on accounting for entering into a cloud computing arrangement with and without a software license. If an arrangement includes a software license, then the purchaser should account for the software license element of the arrangement consistent with the treatment of other software licenses. If an arrangement does not include a software license, it should be treated as a service contract. ASU 2015-05 will be effect for us beginning October 1, 2016, but early adoption is permitted. We are currently evaluating the impact of implementation of this standard on our financial statements. In July 2015, the FASB issued ASU No, 2015-11, "Simplifying the Measurement of Inventory" (Topic 330). The provisions of ASU 2015-11 require an entity to measure inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonable predictable costs of completion, disposal, and transportation. ASU 2015-11 will be effective for us beginning October 1, 2017 but early adoption is permitted. We do not believe the adoption of this standard will have a material effect on our financial statements. In August 2015, the FASB issued ASU No. 2015-15, "Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements" (Subtopic 835-30). ASU 2015-15 provides guidance on the treatment of debt issuance cost related to line-of-credit arrangements based on comments provided by the SEC staff. The SEC staff stated that it would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance cost ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. ASU 2015-15 will be effective for us beginning October 1, 2016, but early adoption is permitted. We are currently evaluating the impact of implementation of this standard on our financial statements. In September 2015, the FASB issued ASU No. 2015-16, "Simplifying the Accounting for Measurement Period Adjustments" (Topic 805). The provisions of ASU 2015-16 require an acquirer to recognize adjustments to provisional amounts identified during the measurement period in the reporting period in which the adjustment amounts are determined. ASU 2015-16 requires an acquirer to record, in the same period's financial statements, the effect on earnings of changes in depreciation, amortization or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the account had been completed at the acquisition date. ASU 2015-16 also requires an entity to present separately on the face of the income statement or disclose in the footnotes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustments had been recognized as of the acquisition date. ASU 2015-16 will be effective for us beginning October 1, 2017, but early adoption is permitted. We are currently evaluating the impact of implementation of this standard on our financial statements. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Sep. 30, 2015 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3. FAIR VALUE OF FINANCIAL INSTRUMENTS Fair value is defined as the price that would be received from the sale of an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The FASB established a three-level hierarchy for disclosure based on the extent and level of judgment used to estimate fair value. Level 1 inputs consist of valuations based on quoted market prices in active markets for identical assets or liabilities. Level 2 inputs consist of valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in an inactive market, or other observable inputs. Level 3 inputs consist of valuations based on unobservable inputs that are supported by little or no market activity. The following table presents financial instruments, other than long-term debt, that we measured at fair value on a recurring basis at September 30, 2015 and 2014. September 30, 2015 Level 1 Level 2 Level 3 Total Fair Value Assets: Cash and cash equivalents $ 354,190 $ - $ - $ 354,190 Other long-term investments 1,720 - - 1,720 Derivative financial instruments - 14 - 14 Total assets $ 355,910 $ 14 $ - $ 355,924 Liabilities: Derivative financial instruments - 1,406 - 1,406 Total liabilities $ - $ 1,406 $ - $ 1,406 September 30, 2014 Level 1 Level 2 Level 3 Total Fair Value Assets: Cash and cash equivalents $ 284,155 $ - $ - $ 284,155 Other long-term investments 1,654 - - 1,654 Derivative financial instruments - 100 - 100 Total assets $ 285,809 $ 100 $ - $ 285,909 Liabilities: Derivative financial instruments - 270 - 270 Total liabilities $ - $ 270 $ - $ 270 Our cash and cash equivalents consist of various bank accounts used to support our operations and investments in institutional money-market funds that are traded in active markets. Our other long-term investments represent the fair value of investments under the Cabot Microelectronics Supplemental Employee Retirement Plan (SERP), which is a nonqualified supplemental savings plan. The fair value of the investments is determined through quoted market prices within actively traded markets. Although the investments are allocated to individual participants and investment decisions are made solely by those participants, the SERP is a nonqualified plan. Consequently, the Company owns the assets and the related offsetting liability for disbursement until such time as a participant makes a qualifying withdrawal. The long-term asset was adjusted to $1,720 in the fourth quarter of fiscal 2015 to reflect its fair value as of September 30, 2015. Our derivative financial instruments include forward foreign exchange contracts and interest rate swaps. In the first quarter of fiscal 2015, we entered into floating-to-fixed interest rate swap agreements to hedge the variability in LIBOR-based interest payments on a portion of our outstanding variable rate debt. These interest rate swaps represent our primary use of derivative financial instruments. The fair value of our derivative instruments is estimated using standard valuation models using market-based observable inputs over the contractual term, including one-month LIBOR-based yield curves, among others. We consider the risk of nonperformance, including counterparty credit risk, in the calculation of the fair value of derivative financial instruments. See Note 10 for more information on our use of derivative financial instruments. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Sep. 30, 2015 | |
INVENTORIES [Abstract] | |
INVENTORIES | 4. INVENTORIES Inventories consisted of the following: September 30, 2015 2014 Raw materials $ 42,603 $ 37,009 Work in process 5,487 4,505 Finished goods 22,588 23,465 Total $ 70,678 $ 64,979 The increase in inventory is primarily due to higher raw material costs and the amount of certain manufacturing variances, which are included in cost of goods sold in the period when the inventory is sold to customers. |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Sep. 30, 2015 | |
PROPERTY, PLANT AND EQUIPMENT [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | 5. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following: September 30, 2015 2014 Land $ 17,076 $ 17,834 Buildings 92,720 97,513 Machinery and equipment 167,448 171,461 Furniture and fixtures 6,172 6,224 Information systems 28,528 27,673 Construction in progress 7,553 3,166 Total property, plant and equipment 319,497 323,871 Less: accumulated depreciation (225,754 ) (223,050 ) Net property, plant and equipment $ 93,743 $ 100,821 Depreciation expense was $16,060, $17,467 and $17,835 for the years ended September 30, 2015, 2014 and 2013, respectively. We did not record any impairment expense in fiscal 2015. In fiscal 2014, we recorded $2,320 in impairment expense primarily related to the decision to write-off certain manufacturing assets in foreign locations in accordance with the applicable accounting standards for the impairment and disposal of long-lived assets. Of this amount, $2,236 and $84 was included in cost of goods sold and selling and marketing expense, respectively. Impairment expense for fiscal 2013 was insignificant. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Sep. 30, 2015 | |
GOODWILL AND OTHER INTANGIBLE ASSETS [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | 6. GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill was $40,442 and $43,245 as of September 30, 2015 and 2015, respectively. The decrease in goodwill was due to foreign exchange fluctuations of the New Taiwan dollar. The components of other intangible assets are as follows: September 30, 2015 September 30, 2014 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Other intangible assets subject to amortization: Product technology $ 8,053 $ 7,490 $ 8,278 $ 6,750 Acquired patents and licenses 8,270 7,845 8,270 7,534 Trade secrets and know-how 2,550 2,550 2,550 2,550 Customer relationships, distribution rights and other 11,392 9,005 12,193 8,484 Total other intangible assets subject to amortization 30,265 26,890 31,291 25,318 Total other intangible assets not subject to amortization* 1,190 1,190 Total other intangible assets $ 31,455 $ 26,890 $ 32,481 $ 25,318 * Total other intangible assets not subject to amortization primarily consist of trade names. Amortization expense was $2,346, $2,474 and $2,622 for fiscal 2015, 2014 and 2013, respectively. Estimated future amortization expense of intangible assets as of September 30, 2015 for the five succeeding fiscal years is as follows: Fiscal Year Estimated Amortization Expense 2016 $ 1,875 2017 1,064 2018 419 2019 11 2020 6 Goodwill and indefinite-lived intangible assets are tested for impairment annually in the fourth quarter of our fiscal year or more frequently if indicators of potential impairment exist, using a fair-value-based approach. The recoverability of goodwill is measured at the reporting unit level, which is defined as either an operating segment or one level below an operating segment. An entity has the option to assess the fair value of a reporting unit either using a qualitative analysis ("step zero") or a discounted cash flow analysis ("step one"). Similarly, an entity has the option to use a step zero or a step one approach to determine the recoverability of indefinite-lived intangible assets. In fiscal 2014 and 2015, we chose to use a step one analysis for both goodwill impairment and for indefinite-lived intangible asset impairment. We completed our annual impairment test during our fourth quarter of fiscal 2015 and concluded that no impairment existed. There have been no cumulative impairment charges recorded on the goodwill for any of our reporting units. |
OTHER LONG-TERM ASSETS
OTHER LONG-TERM ASSETS | 12 Months Ended |
Sep. 30, 2015 | |
OTHER LONG-TERM ASSETS [Abstract] | |
OTHER LONG-TERM ASSETS | 7. OTHER LONG-TERM ASSETS Other long-term assets consisted of the following: September 30, 2015 2014 Auction rate securities (ARS) $ 5,694 $ 5,895 Other long-term assets 3,595 3,043 Long-term contract asset 3,995 - Other long-term investments 1,720 1,654 Total $ 15,004 $ 10,592 We classify our ARS investments as held-to-maturity and have recorded them at cost. Our ARS investments at September 30, 2015 consisted of two tax exempt municipal debt securities with a total par value of $5,694, both of which have maturities greater than ten years. The ARS market began to experience illiquidity in early 2008, and this illiquidity continues. Despite this lack of liquidity, there have been no defaults in payment of the underlying securities and interest income on these holdings continues to be received on scheduled interest payment dates. Our ARS, when purchased, were issued by A-rated municipalities. Although the credit ratings of both municipalities have been downgraded since our original investment, one of the ARS is credit enhanced with bond insurance, and the other has become an obligation of the bond insurer. Both ARS currently carry a credit rating of AA- by Standard & Poor's. The fair value of our ARS, determined using level 2 fair value inputs, was $5,182 as of September 30, 2015. WWe have classified our ARS as held-to-maturity based on our intention and ability to hold the securities until maturity. We believe the gross unrecognized loss of $512 is due to the illiquidity in the ARS market, rather than to credit loss. We will continue to monitor our ARS for impairment indicators, which may require us to record an impairment charge that is deemed other-than-temporary. In November 2011, the municipality that issued one of our ARS filed for bankruptcy protection. As a result of the approval of the municipality's reorganization plan, and our voting elections, we received 65% of the par value outstanding, or $2,113, during the quarter ended December 31, 2013, and we reversed the $234 temporary impairment that we previously recorded. In the third quarter of fiscal 2015, we amended a supply contract with an existing supplier. The amended agreement includes a fee of $4,500, which provides us the option to purchase certain raw materials beyond calendar 2016. This fee was recorded as a long-term asset at its present value and is being amortized into cost of goods sold on a straight-line basis through December 31, 2019, the expiration date of the agreement. See Note 17 for more information regarding this contract. Other long-term assets are comprised of the long-term portion of prepaid unamortized debt costs as well as miscellaneous deposits and prepayments on contracts extending beyond the next 12 months. As discussed in Note 3, we recorded a long-term asset and a corresponding long-term liability of $1,720 representing the fair value of our SERP investments as of September 30, 2015. |
ACCRUED EXPENSES, INCOME TAXES
ACCRUED EXPENSES, INCOME TAXES PAYABLE AND OTHER CURRENT LIABILITIES | 12 Months Ended |
Sep. 30, 2015 | |
ACCRUED EXPENSES, INCOME TAXES PAYABLE AND OTHER CURRENT LIABILITIES [Abstract] | |
ACCRUED EXPENSES, INCOME TAXES PAYABLE AND OTHER CURRENT LIABILITIES | 8. ACCRUED EXPENSES, INCOME TAXES PAYABLE AND OTHER CURRENT LIABILITIES Accrued expenses, income taxes payable and other current liabilities consisted of the following: September 30, 2015 2014 Accrued compensation $ 23,793 $ 16,980 Goods and services received, not yet invoiced 1,830 3,167 Deferred revenue and customer advances 538 1,223 Warranty accrual 209 246 Income taxes payable 4,276 5,448 Taxes, other than income taxes 975 1,182 Other 4,825 3,148 Total $ 36,446 $ 31,394 |
DEBT
DEBT | 12 Months Ended |
Sep. 30, 2015 | |
DEBT [Abstract] | |
DEBT | 9. DEBT On February 13, 2012, we entered into a credit agreement (the "Credit Agreement") among the Company, as Borrower, Bank of America, N.A., as administrative agent, swing line lender and an L/C issuer, Bank of America Merrill Lynch and J.P. Morgan Securities LLC, as joint lead arrangers and joint book managers, JPMorgan Chase Bank, N.A., as syndication agent, and Wells Fargo Bank, N.A. as documentation agent. The Credit Agreement provided us with a $175,000 term loan (the "Term Loan"), which we drew on February 27, 2012 to fund approximately half of the special cash dividend we paid to our stockholders on March 1, 2012, and a $100,000 revolving credit facility (the "Revolving Credit Facility"), which has never been drawn, with sub-limits for multicurrency borrowings, letters of credit and swing-line loans. The Term Loan and the Revolving Credit Facility are referred to as the "Credit Facilities." On June 27, 2014, we entered into an amendment (the "Amendment") to the Credit Agreement, which (i) increased term loan commitments by $17,500, from $157,500 to $175,000, the same level as the original amount under the Credit Agreement at its inception in 2012; (ii) increased the uncommitted accordion feature on the Revolving Credit Facility from $75,000 to $100,000; (iii) extended the expiration date of the Credit Facilities from February 13, 2017 to June 27, 2019; (iv) relaxed the consolidated leverage ratio financial covenant; and (v) revised certain pricing terms and other terms within the Credit Agreement. On June 27, 2014, we drew the $17,500 of increased term loan commitments, bringing the total outstanding commitments under the Term Loan to $175,000. Borrowings under the amended Credit Facilities (other than in respect of swing-line loans) bear interest at a rate per annum equal to the "Applicable Rate" (as defined below) plus, at our option, either (1) a LIBOR rate determined by reference to the cost of funds for deposits in the relevant currency for the interest period relevant to such borrowing or (2) the "Base Rate", which is the highest of (x) the prime rate of Bank of America, N.A., (y) the federal funds rate plus 1/2 of 1.00% and (z) the one-month LIBOR rate plus 1.00%. The current Applicable Rate for borrowings under the Credit Facilities is 1.50%, as amended, with respect to LIBOR borrowings and 0.25% with respect to Base Rate borrowings, with such Applicable Rate subject to adjustment based on our consolidated leverage ratio. Swing-line loans bear interest at the Base Rate plus the Applicable Rate for Base Rate loans under the Revolving Credit Facility. In addition to paying interest on outstanding principal under the Credit Agreement, we pay a commitment fee to the lenders under the Revolving Credit Facility in respect of the unutilized commitments thereunder. As amended, the fee ranges from 0.20% to 0.30%, based on our consolidated leverage ratio. Interest expense and commitment fees are paid according to the relevant interest period and no less frequently than at the end of each calendar quarter. We paid $2,658 in arrangement fees, upfront fees and administration fees in February 2012 and we paid an additional $550 iin upfront fees and arrangement fees in June 2014, of which $410 remains in prepaid expenses and other current assets and $1,075 remains in other long-term assets on our Consolidated Balance Sheet as of September 30, 2015. We also pay letter of credit fees as necessary. The Term Loan has periodic scheduled repayments; however, we may voluntarily prepay the Credit Facilities without premium or penalty, subject to customary "breakage" fees and reemployment costs in the case of LIBOR borrowings. All obligations under the Credit Agreement are guaranteed by certain of our existing and future direct and indirect domestic subsidiaries. The obligations under the Credit Agreement and guarantees of those obligations are secured, subject to certain exceptions, by first priority liens and security interests in the assets of the Company and certain of its domestic subsidiaries. In the first quarter of fiscal 2015, we entered into interest rate swap agreements that have the economic effect of converting the interest rate on 50% of our debt from variable into fixed at a weighted average fixed rate of 1.50% plus the Applicable Rate defined above. See Notes 3 and 10 for additional information on the interest rate swap agreements. The Credit Agreement contains covenants that restrict the ability of the Company and its subsidiaries to take certain actions, including, among other things and subject to certain significant exceptions: creating liens, incurring indebtedness, making investments, engaging in mergers, selling property, paying dividends or amending organizational documents. The Credit Agreement requires us to comply with certain financial ratio maintenance covenants. These include a maximum consolidated leverage ratio of 3.00 to 1.00 through December 31, 2015 and a minimum consolidated fixed charge coverage ratio of 1.25 to 1.00. The maximum consolidated leverage ratio will decrease to 2.75 to 1.00 from January 1, 2016 through the termination of the Credit Agreement. As of September 30, 2015, our consolidated leverage ratio was 1.52 to 1.00 and our consolidated fixed charge coverage ratio was 5.54 to 1.00. The Credit Agreement also contains customary affirmative covenants and events of default. We believe we are in compliance with these covenants. At September 30, 2015, the fair value of the Term Loan, using level 2 inputs, approximates its carrying value of $164,063 as the loan bears a floating market rate of interest. As of September 30, 2015, $8,750 of the debt outstanding is classified as short-term. Principal repayments of the Term Loan are generally made on the last calendar day of each quarter if that day is considered to be a business day. As of September 30, 2015, scheduled principal repayments of the Term Loan were as follows: Fiscal Year Principal Repayments 2016 $ 8,750 2017 7,656 2018 14,219 2019 133,438 Total $ 164,063 |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 12 Months Ended |
Sep. 30, 2015 | |
DERIVATIVE FINANCIAL INSTRUMENTS [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS | 10. DERIVATIVE FINANCIAL INSTRUMENTS We are exposed to various market risks, including risks associated with interest rates and foreign currency exchange rates. We enter into certain derivative transactions to mitigate the volatility associated with these exposures. We have policies in place that define acceptable instrument types we may enter into and we have established controls to limit our market risk exposure. We do not use derivative financial instruments for trading or speculative purposes. In addition, all derivatives, whether designated in hedging relationships or not, are required to be recorded on the balance sheet at fair value on a gross basis. Cash Flow Hedges – Interest Rate Swap Agreements In the first quarter of fiscal 2015, we entered into floating-to-fixed interest rate swap agreements to hedge the variability in LIBOR-based interest payments on $86,406 of our outstanding variable rate debt. The notional amount of the swaps decreases each quarter by an amount in proportion to our scheduled quarterly principal payment of debt. The notional value of the swaps was $82,031 as of September 30, 2015, and the swaps are scheduled to expire on June 27, 2019. We have designated these swap agreements as cash flow hedges pursuant to ASC 815, "Derivatives and Hedging". As cash flow hedges, unrealized gains are recognized as assets and unrealized losses are recognized as liabilities. Unrealized gains and losses are designated as effective or ineffective based on a comparison of the changes in fair value of the interest rate swaps and changes in fair value of the underlying exposures being hedged. The effective portion is recorded as a component of accumulated other comprehensive income or loss, while the ineffective portion is recorded as a component of interest expense. Changes in the method by which we pay interest from one-month LIBOR to another rate of interest could create ineffectiveness in the swaps, and result in amounts being reclassified from other comprehensive income into net income. Hedge effectiveness is tested quarterly to determine if hedge treatment is appropriate. Foreign Currency Contracts Not Designated as Hedges Periodically we enter into forward foreign exchange contracts in an effort to mitigate the risks associated with currency fluctuations on certain foreign currency balance sheet exposures. Our foreign exchange contracts do not qualify for hedge accounting; therefore, the gains and losses resulting from the impact of currency exchange rate movements on our forward foreign exchange contracts are recognized as other income or expense in the accompanying consolidated income statements in the period in which the exchange rates change. As of September 30, 2015 and September 30, 2014, respectively, the notional amounts of the forward contracts we held to purchase U.S. dollars in exchange for other international currencies were $1,034 and $4,695, respectively, and the notional amounts of forward contracts we held to sell U.S. dollars in exchange for other international currencies were $18,690 and $18,425, respectively. The fair value of our derivative instruments included in the Consolidated Balance Sheet, which was determined using level 2 inputs, was as follows: Asset Derivatives Liability Derivatives Balance Sheet Location Fair value at September 30, 2015 Fair Value at September 30, 2014 Fair Value at September 30, 2015 Fair Value at September 30, 2014 Derivatives designated as hedging instruments Interest rate swap contracts Other noncurrent assets $ - $ - $ - $ - Accrued expenses and other current liabilities $ - $ - $ 885 $ - Other long-term liabilities $ - $ - $ 513 $ - Derivatives not designated as hedging instruments Foreign exchange contracts Prepaid expenses and other current assets $ 14 $ 100 $ - $ - Accrued expenses and other current liabilities $ - $ - $ 8 $ 270 The following table summarizes the effect of our derivative instrument on our Consolidated Statement of Income for the fiscal years ended September 30, 2015, 2014 and 2013: Gain (Loss) Recognized in Statement of Income Fiscal Year Ended Derivatives not designated as hedging instruments Statement of Income Location September 30, 2015 September 30, 2014 September 30, 2014 Foreign exchange contracts Other income (expense), net $ (1,674 ) $ (1,289 ) $ 252 The interest rate swap agreements have been deemed to be effective since inception, so there has been no impact on our Consolidated Statement of Income. We recorded a $901 unrealized loss, net of tax, in accumulated comprehensive income during the year ended September 30, 2015 for these interest rate swaps. During the next 12 months, we expect approximately $901 to be reclassified from accumulated other comprehensive income into interest expense related to our interest rate swaps as we expect the fixed interest rate on our interest rate swaps will be higher than the variable interest rate on our outstanding debt. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME | 12 Months Ended |
Sep. 30, 2015 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME [Text Block] | 11. ACCUMULATED OTHER COMPREHENSIVE INCOME The table below summarizes the components of accummulated other comprehensive income (loss), net of tax for the years ended September 30, 2015, 2014, and 2013. Foreign Currency Translation Cash Flow Hedges Other Postretirement Liabilities Marketable Securities Total Balance at September 30, 2012 $ 31,288 $ - $ (671 ) $ (151 ) $ 30,466 Foreign currency translation adjustment, net of tax of $(3,187) (13,037 ) - - - (13,037 ) Change in pension and other postretirement, net of tax of $0 - - 7 - 7 Balance at September 30, 2013 18,251 - (664 ) (151 ) 17,436 Foreign currency translation adjustment, net of tax of $(1,597) (8,136 ) - - (8,136 ) Unrealized gain (loss) on marketable securities - - - 151 151 Change in pension and other postretirement, net of tax of $0 - - (196 ) - (196 ) Balance at September 30, 2014 10,115 - (860 ) - 9,255 Foreign currency translation adjustment, net of tax of $(1,731) (14,126 ) - - - (14,126 ) Unrealized gain (loss) on cash flow hedges Change in fair value, net of tax of $(833) - (1,511 ) - - (1,511 ) Reclassification adjustment into earnings, net of tax of $336 - 610 - - 610 Change in pension and other postretirement, net of tax of $0 - - (318 ) - (318 ) Balance at September 30, 2015 $ (4,011 ) $ (901 ) $ (1,178 ) $ - $ (6,090 ) The before tax amount reclassified from OCI to net income in fiscal 2015, related to our cash flow hedges, were recorded as interest expense on our Consolidated Statement of Income. Amounts reclassified from OCI to net income, related to pension liabilities, were not material in fiscal years 2015, 2014 and 2013. |
SHARE-BASED COMPENSATION PLANS
SHARE-BASED COMPENSATION PLANS | 12 Months Ended |
Sep. 30, 2015 | |
SHARE-BASED COMPENSATION PLANS [Abstract] | |
SHARE-BASED COMPENSATION PLANS | 12. SHARE-BASED COMPENSATION PLANS EQUITY INCENTIVE PLAN AND OMNIBUS INCENTIVE PLAN In March 2004, our stockholders approved our Second Amended and Restated Cabot Microelectronics Corporation 2000 Equity Incentive Plan (the "EIP"), as amended and restated September 23, 2008. On March 6, 2012, our stockholders approved the 2012 Omnibus Incentive Plan (the "OIP"), which is the successor plan to the EIP. As of such time, all share-based awards have been made from the OIP, and the EIP is no longer available for any awards. The OIP is administered by the Compensation Committee of the Board of Directors and is intended to provide management with the flexibility to attract, retain and reward our employees, directors, consultants and advisors. The OIP allows for the granting of six types of equity incentive awards: stock options, restricted stock, restricted stock units, stock appreciation rights (SARs), performance-based awards and substitute awards. The OIP also provides for cash incentive awards to be made. Substitute awards under the OIP are those awards that, in connection with an acquisition, may be granted to employees, directors, consultants or advisors of the acquired company, in substitution for equity incentives held by them in the seller or the acquired company. As of September 30, 2015, no SARs, performance awards, or substitute awards had been granted to date under either plan. No awards of any type have been granted to date to consultants or advisors under either plan. The OIP authorizes up to 4,934,444 shares of stock to be granted thereunder, including up to 2,030,952 shares of stock in the aggregate of awards other than options or SARs, and up to 2,538,690 incentive stock options. The 4,934,444 shares of stock represents 2,901,360 shares of newly authorized shares and 2,033,084 shares previously available under the EIP. In addition, shares that become available from awards under the EIP and the OIP because of events such as forfeitures, cancellations or expirations, or because shares subject to an award are withheld to satisfy tax withholding obligations, will also be available for issuance under the OIP. Shares issued under our share-based compensation plans are issued from new shares rather than from treasury shares. Non-qualified stock options issued under the OIP, as they were under the EIP, are generally time-based and provide for a ten-year term,with options generally vesting equally over a four-year period, with first vesting on the first anniversary of the award date. Non-qualified stock options granted to non-employee directors on an annual basis vest 100 % on the first anniversary of the award date. Compensation expense related to our stock option awards was $7,173, $6,947 and $6,878 in fiscal 2015, 2014 and 2013, respectively. For additional information on our accounting for share-based compensation, see Note 2. Under the OIP, as under the EIP, employees may also be granted ISOs to purchase common stock at not less than the fair value on the date of the grant. As of September 30, 2015, no ISOs had been granted to date under either plan. Under the OIP, as under the EIP, employees and non-employees may be awarded shares of restricted stock or restricted stock units, which generally vest over a four-year period, with first vesting on the anniversary of the grant date. Restricted stock units granted to non-employee directors on an annual basis vest 100 % on the first anniversary of the award date. In general, shares of restricted stock and restricted stock units may not be sold, assigned, transferred, pledged, disposed of or otherwise encumbered. Holders of restricted stock, and restricted stock units, if specified in the award agreements, have all the rights of stockholders, including voting and dividend rights, subject to the above restrictions, although the current holders of restricted stock units do not have such rights. Restricted shares under the OIP, as under the EIP, also may be purchased and placed "on deposit" by executive officers pursuant to the 2001 Deposit Share Program. Shares purchased under this Deposit Share Program receive a 50 % match in restricted shares ("Award Shares"). These Award Shares vest at the end of a three-year period, and are subject to forfeiture upon early withdrawal of the deposit shares. Compensation expense related to our restricted stock and restricted stock unit awards and restricted shares matched at 50 % pursuant to the Deposit Share Program was $8,491, $6,320 and $5,793 for fiscal 2015, 2014 and 2013, respectively. EMPLOYEE STOCK PURCHASE PLAN In March 2008, our stockholders approved our 2007 Cabot Microelectronics Employee Stock Purchase Plan (the "ESPP"), which amended the ESPP for the primary purpose of increasing the authorized shares of common stock to be purchased under the ESPP from DIRECTORS' DEFERRED COMPENSATION PLAN The Directors' Deferred Compensation Plan (DDCP), as amended and restated September 23, 2008, became effective in March 2001 and applies only to our non-employee directors. The cumulative number of shares deferred under the plan was 63,979 and 76,633 as of September 30, 2015 and 2014, respectively. Compensation expense related to the DDCP was $95 for each of fiscal 2015, 2014 and 2013. ACCOUNTING FOR SHARE-BASED COMPENSATION We record share-based compensation expense for all share-based awards, including stock option grants, restricted stock and restricted stock unit awards and employee stock purchase plan purchases. We calculate share-based compensation expense using the straight-line approach based on awards ultimately expected to vest, which requires the use of an estimated forfeiture rate. Our estimated forfeiture rate is primarily based on historical experience, and is revised from time-to-time when actual forfeitures differ from the estimate. We use the Black-Scholes option-pricing model to estimate the grant date fair value of our stock options and employee stock purchase plan purchases. This model requires the input of highly subjective assumptions, including the price volatility of the underlying stock, the expected term of our stock options and the risk-free interest rate. We estimate the expected volatility of our stock options based on a combination of our stock's historical volatility and the implied volatilities from actively-traded options on our stock. We calculate the expected term of our stock options using historical stock option exercise data, and we add a slight premium to this expected term for employees who meet the definition of retirement eligible pursuant to their grants during the contractual term of the grant. The risk-free rate is derived from the U.S. Treasury yield curve in effect at the time of grant. The fair value of our share-based awards, as shown below, was estimated using the Black-Scholes model with the following weighted-average assumptions, excluding the effect of our leveraged recapitalization: Year Ended September 30, 2015 2014 2013 Stock Options Weighted-average grant date fair value $ 16.99 $ 15.78 $ 12.13 Expected term (in years) 6.30 6.40 6.37 Expected volatility 33 % 32 % 36 % Risk-free rate of return 1.9 % 1.9 % 0.9 % Dividend yield - - - ESPP Weighted-average grant date fair value $ 10.17 $ 9.11 $ 7.41 Expected term (in years) 0.50 0.50 0.50 Expected volatility 24 % 25 % 25 % Risk-free rate of return 0.1 % 0.1 % 0.1 % Dividend yield - - - The Black-Scholes model is primarily used in estimating the fair value of short-lived exchange traded options that have no vesting restrictions and are fully transferable. Because employee stock options and ESPP purchases have certain characteristics that are significantly different from traded options, and because changes in the subjective assumptions can materially affect the estimated value, our use of the Black-Scholes model for estimating the fair value of stock options and ESPP purchases may not provide an accurate measure. Although the value of our stock options and ESPP purchases are determined in accordance with applicable accounting standards using an option-pricing model, those values may not be indicative of the fair values observed in a willing buyer/willing seller market transaction. The fair value of our restricted stock and restricted stock unit awards represents the closing price of our common stock on the date of award. Share-based compensation expense related to restricted stock and restricted stock unit awards is recorded net of expected forfeitures. SHARE-BASED COMPENSATION EXPENSE Total share-based compensation expense for the years ended September 30, 2015, 2014 and 2013, is as follows: Year Ended September 30, Income statement classifications: 2015 2014 2013 Cost of goods sold $ 1,912 $ 1,866 $ 1,707 Research, development and technical 1,596 1,475 1,301 Selling and marketing 1,075 1,298 1,367 General and administrative 11,862 9,403 8,975 Tax benefit (5,511 ) (4,722 ) (4,581 ) Total share-based compensation expense, net of tax $ 10,934 $ 9,320 $ 8,769 Our non-employee directors received annual equity awards in March 2015, pursuant to the OIP. The award agreements provide for immediate vesting of the award at the time of termination of service for any reason other than by reason of Cause, Death, Disability or a Change in Control, as defined in the OIP, if at such time the non-employee director has completed an equivalent of at least two full terms as a director of the Company, as defined in the Company's bylaws. Six of the Company's non-employee directors had completed at least two full terms of service as of the date of the March 2015 award. Consequently, the requisite service period for the award had already been satisfied and we recorded the fair value of $1,308 of the awards to these six directors to share-based compensation expense in the fiscal quarter ended March 31, 2015 rather than recording that expense over the one-year vesting period stated in the award agreement, as is done for the other non-employee directors who received annual equity awards in fiscal 2015. On December 16, 2014, we announced that effective January 1, 2015, William P. Noglows would cease to serve as our President and Chief Executive Officer, and continue to serve only as the Executive Chairman of our Board of Directors until at least December 31, 2015. Under an employment letter with the Company dated December 12, 2014, filed as an exhibit to our Form 10-Q for the quarter ended December 31, 2014, all unvested stock options and restricted stock held by Mr. Noglows as of the date of his termination of service as Executive Chairman will vest in full, according to terms of, and if all service requirements under, the employment letter have been met. We applied the accounting guidance under Accounting Standards Codification (ASC) Topic 718 "Stock Compensation" to determine the additional share-based compensation expense to be recorded as part of the modification of the outstanding equity in the likely event that Mr. Noglows' service as Executive Chairman terminates according to the terms of the employment letter prior to the scheduled vesting of such equity. The additional share-based compensation expense was determined to be $378, which is being recorded ratably between December 12, 2014, the date of the modification, and December 31, 2015, the likely date of his termination of service. In addition, the original fair value of his unvested equity totaling $5,033 is being recorded ratably between the date of modification and December 31, 2015, rather than over the original vesting period. A summary of stock option activity under the EIP and OIP as of September 30, 2015, and changes during fiscal 2015 are presented below: Stock Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Outstanding at September 30, 2014 3,272,898 $ 29.04 Granted 397,528 47.00 Exercised (1,324,646 ) 25.05 Forfeited or canceled (185,987 ) 39.41 Outstanding at September 30, 2015 2,159,793 $ 33.90 6.5 $ 15,376 Exercisable at September 30, 2015 1,256,818 $ 28.95 5.4 $ 12,995 Expected to vest after September 30, 2015 901,535 $ 40.77 8.1 $ 2,381 The aggregate intrinsic value in the table above represents the total pretax intrinsic value (i.e., for all in-the-money stock options, the difference between our closing stock price of $38.74 per share on the last trading day of fiscal 2015 and the exercise price, multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their options on the last trading day of fiscal 2015. The total intrinsic value of options exercised was $31,546, $21,647 and $9,847 for fiscal 2015, 2014 and 2013, respectively. The total cash received from options exercised was $33,177, $40,248 and $28,525 for fiscal 2015, 2014 and 2013, respectively. The actual tax benefit realized for the tax deductions from options exercised was $10,569, $7,611 and $3,394 for fiscal 2015, 2014 and 2013, respectively. The total fair value of stock options vested during fiscal years 2015, 2014 and 2013 was $7,005, $6,645 and $6,681, respectively. As of September 30, 2015, there was $9,566 of total unrecognized share-based compensation expense related to unvested stock options granted under the EIP and OIP. That cost is expected to be recognized over a weighted-average period of 2.3 years. RESTRICTED STOCK AND RESTRICTED STOCK UNITS A summary of the status of the restricted stock awards and restricted stock unit awards outstanding that were granted under the EIP and OIP as of September 30, 2015, and changes during fiscal 2015, are presented below: Restricted Stock Awards and Units Weighted Average Grant Date Fair Value Nonvested at September 30, 2014 398,099 $ 39.11 Granted 228,492 47.13 Vested (180,417 ) 40.03 Forfeited (63,678 ) 41.63 Nonvested at September 30, 2015 382,496 $ 43.05 As of September 30, 2015, there was $11,094 of total unrecognized share-based compensation expense related to unvested restricted stock awards and restricted stock units under the EIP and OIP. That cost is expected to be recognized over a weighted-average period of 2.4 years. The total fair value of restricted stock awards and restricted stock units vested during fiscal years 2015, 2014 and 2013 was $7,222, $5,916 and $5,457, respectively. |
SAVINGS PLAN
SAVINGS PLAN | 12 Months Ended |
Sep. 30, 2015 | |
SAVINGS PLAN [Abstract] | |
SAVINGS PLAN | 13. SAVINGS PLAN Effective in May 2000, we adopted the Cabot Microelectronics Corporation 401(k) Plan (the "401(k) Plan"), which is a qualified defined contribution plan, covering all eligible U.S. employees meeting certain minimum age and eligibility requirements, as defined by the 401(k) Plan. Participants may make elective contributions of up to 60% oof their eligible compensation. All amounts contributed by participants and earnings on these contributions are fully vested at all times. The 401(k) Plan provides for matching and fixed non-elective contributions by the Company. Under the 401(k) Plan, the Company will match 100% of the first four percent of the participant's eligible compensation and 50% of the next 0.02 of the participant's eligible compensation that is contributed, subject to limitations required by government regulations. Under the 401(k) Plan, all U.S. employees, even those who do not contribute to the 401(k) Plan, receive a contribution by the Company in an amount equal to four percent of eligible compensation, and thus are participants in the 401(k) Plan. Participants are 100% vested in all Company contributions at all times. The Company's expense for the 401(k) Plan totaled $4,111, $4,547 and $4,057 for the fiscal years ended September 30, 2015, 2014 and 2013, respectively. |
OTHER INCOME (EXPENSE), NET
OTHER INCOME (EXPENSE), NET | 12 Months Ended |
Sep. 30, 2015 | |
OTHER INCOME, NET [Abstract] | |
OTHER INCOME (EXPENSE), NET | 14. OTHER INCOME, NET Other income (expense), net, consisted of the following: Year Ended September 30, 2015 2014 2013 Interest income $ 365 $ 194 $ 145 Other income (expense) 316 (54 ) 1,247 Total other income, net $ 681 $ 140 $ 1,392 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Sep. 30, 2015 | |
STOCKHOLDERS EQUITY [Abstract] | |
STOCKHOLDERS EQUITY | 15. STOCKHOLDERS' EQUITY The following is a summary of our capital stock activity over the past three years: Number of Shares Common Stock Treasury Stock September 30, 2012 28,864,527 5,682,288 Exercise of stock options 1,071,750 Restricted stock under EIP, net of forfeitures 185,925 Restricted stock under Deposit Share Plan, net of forfeitures 6,773 Common stock under ESPP 84,602 Repurchases of common stock under share repurchase plans 1,144,836 Repurchases of common stock – other 39,551 September 30, 2013 30,213,577 6,866,675 Exercise of stock options 1,449,002 Restricted stock under EIP and OIP, net of forfeitures 176,026 Restricted stock under Deposit Share Plan, net of forfeitures 7,296 Common stock under ESPP 81,700 Repurchases of common stock under share repurchase plans 1,229,494 Repurchases of common stock – other 46,518 September 30, 2014 31,927,601 8,142,687 Exercise of stock options 1,324,646 Restricted stock under EIP and OIP, net of forfeitures 172,010 Restricted stock under Deposit Share Plan, net of forfeitures (811) Common stock under ESPP 65,735 Repurchases of common stock under share repurchase plans 851,245 Repurchases of common stock – other 47,746 September 30, 2015 33,489,181 9,041,678 COMMON STOCK Each share of common stock, including those awarded as restricted stock, but not restricted stock units, entitles the holder to one vote on all matters submitted to a vote of Cabot Microelectronics' stockholders. Common stockholders are entitled to receive ratably the dividends, if any, as may be declared by the Board of Directors. The number of authorized shares of common stock is 200,000,000 shares. SHARE REPURCHASES In April 2014, our Board of Directors authorized an increase in the amount available under our share repurchase program from $62,000 to $150,000. Under this program, we repurchased 851,245 shares for $40,026 during fiscal 2015, 1,229,494 shares for $53,000 during fiscal 2014, and 1,144,836 shares for $40,000 during fiscal 2013. As of September 30, 2014, $84,975 remains available under our share repurchase program. To date, we have funded share repurchases under our share repurchase program from our existing cash balance, and anticipate we will continue to do so. The program, which became effective on the authorization date, may be suspended or terminated at any time, at the Company's discretion. For additional information on share repurchases, see Part II, Item 5, "Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities" and the section titled "Liquidity and Capital Resources" in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Form 10-K. Separate from this share repurchase program, a total of 47,746 46,518 and 39,551 shares were purchased during fiscal 2015, 2014 and 2013, respectively, pursuant to the terms of our EIP and OIP as shares withheld from award recipients to cover payroll taxes on the vesting of shares of restricted stock granted under the EIP and OIP. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Sep. 30, 2015 | |
INCOME TAXES [Abstract] | |
INCOME TAXES | 16. INCOME TAXES Income before income taxes was as follows: Year Ended September 30, 2015 2014 2013 Domestic $ 15,305 $ 14,358 $ 40,045 Foreign 55,892 54,236 34,175 Total $ 71,197 $ 68,594 $ 74,220 Taxes on income consisted of the following: Year Ended September 30, 2015 2015 2013 U.S. federal and state: Current $ 6,496 $ 8,978 $ 18,060 Deferred 1,791 488 (3,494 ) Total $ 8,287 $ 9,466 $ 14,566 Foreign: Current $ 7,686 $ 9,565 $ 8,304 Deferred (922 ) (1,188 ) (1,228 ) Total 6,764 8,377 7,076 Total U.S. and foreign $ 15,051 $ 17,843 $ 21,642 The provision for income taxes at our effective tax rate differed from the statutory rate as follows: Year Ended September 30, 2015 2014 2013 Federal statutory rate 35.0% 35.0% 35.0% U.S. benefits from research and experimentation activities (2.2) (0.6) (2.0) State taxes, net of federal effect 0.6 0.8 0.3 Foreign income at other than U.S. rates (21.4) (9.4) (5.3) Change in valuation allowance 0.0 0.0 1.4 Executive compensation 0.6 0.4 0.2 Share-based compensation 0.1 0.1 0.5 Adjustment of prior amounts 1.4 0.1 0.1 Taiwan Restructuring 7.2 - - Domestic production deduction (1.3) (0.3) (0.2) Other, net 1.1 (0.1) (0.8) Provision for income taxes 21.1% 26.0% 29.2% In fiscal years 2013, 2014, and 2015, we elected to permanently reinvest the historical earnings of all of our foreign subsidiaries. We have not provided for deferred taxes on approximately $122,625 of undistributed earnings of such subsidiaries. These earnings could become subject to additional income tax if they are remitted as dividends to the U.S. parent company, loaned to the U.S. parent company, or upon sale of subsidiary stock. Determination of the amount of unrecognized deferred tax liability related to these earnings is not practicable. The decrease in the effective tax rate was primarily due to higher taxable income in foreign jurisdictions with lower income tax rates, primarily Singapore, South Korea and Taiwan, and the reinstatement of the U.S. research and experimentation tax credit, retroactive to January 1, 2014, partially offset by income taxes incurred related to the restructuring of our operations in Taiwan. The results of operations for the fiscal year ended September 30, 2015 include tax adjustments to correct prior period amounts, which we determined to be immaterial to the prior periods to which they related. These adjustments, relating to the tax treatment of intercompany activities between certain of our foreign and U.S. operations, were recorded in fiscal 2015 and reduced full year net income by $868 and diluted earnings per share by approximately $0.04. The Company was awarded a tax holiday in South Korea in conjunction with our investment in research, development and manufacturing facilities there. This arrangement allows for a 0% tax in fiscal years 2013, 2014, and 2015, and a tax at 50% of the local statutory rate in effect for fiscal years 2016 and 2017. This tax holiday reduced our fiscal 2015, 2014, and 2013 income tax provision by approximately $5,446, $3,770 and $467, respectively. This tax holiday increased our fiscal 2015, 2014, and 2013 diluted earnings per share by approximately $0.22, $0.15, and $0.02, respectively. The accounting guidance regarding uncertainty in income taxes prescribes a threshold for the financial statement recognition and measurement of tax positions taken or expected to be taken on a tax return. Under these standards, we may recognize the tax benefit of an uncertain tax position only if it is more likely than not that the tax position will be sustained by the taxing authorities, based on the technical merits of the position. The following table presents the changes in the balance of gross unrecognized tax benefits during the last three fiscal years: Balance September 30, 2012 $ 283 Additions for tax positions relating to the current fiscal year 228 Additions for tax positions relating to prior fiscal years 247 Settlements with taxing authorities - Lapse of statute of limitations - Balance September 30, 2013 758 Additions for tax positions relating to the current fiscal year 59 Additions for tax positions relating to prior fiscal years 125 Settlements with taxing authorities (207 ) Lapse of statute of limitations (34 ) Balance September 30, 2014 701 Additions for tax positions relating to the current fiscal year 194 Additions for tax positions relating to prior fiscal years 1,400 Settlements with taxing authorities (522 ) Lapse of statute of limitations - Balance September 30, 2015 $ 1,773 The entire balance of unrecognized tax benefits shown above as of September 30, 2015 and 2014 would affect our effective tax rate if recognized. We recognize interest and penalties related to uncertain tax positions as income tax expense in our financial statements. Interest accrued on our Consolidated Balance Sheet was $47 and $42 at September 30, 2015 and 2014, respectively, and any interest and penalties charged to expense in fiscal years 2015, 2014 and 2013 was not material. At September 30, 2015, the tax periods open to examination by the U.S. federal government included fiscal years 2013 through 2015. We believe the tax periods open to examination by U.S. state and local governments include fiscal years 2012 through 2015 and the tax periods open to examination by foreign jurisdictions include fiscal years 2011 through 2015. We do not anticipate a significant change to the total amount of unrecognized tax benefits within the next 12 months. Significant components of net deferred tax assets and liabilities were as follows: September 30, 2015 2014 Deferred tax assets: Employee benefits $ 4,061 $ 3,889 Inventory 3,271 3,385 Bad debt reserve 391 515 Share-based compensation expense 9,863 12,150 Net operating losses 556 641 Depreciation and amortization 1,263 267 Other 3,599 3,084 Valuation allowance (3,079 ) (2,912 ) Total deferred tax assets $ 19,925 $ 21,019 Deferred tax liabilities: Translation adjustment $ 55 $ 1,615 Other 339 1,040 Total deferred tax liabilities $ 394 $ 2,655 As of September 30, 2015, the Company had foreign and state net operating loss carryforwards (NOLs) of $1,471 and $848, respectively, which will expire beginning in fiscal year 2017 through fiscal year 2035, for which we have recorded a $1,378 gross valuation allowance, all of which was attributable to foreign NOLs. As of September 30, 2015, the Company had $2,497 in state tax credit carryforwards, for which we have recorded a $2,430 gross valuation allowance. As of September 30, 2015, the Company had a capital loss carryforward of $2,849, for which we have recorded a full valuation allowance. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Sep. 30, 2015 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 17. COMMITMENTS AND CONTINGENCIES LEGAL PROCEEDINGS While we are not involved in any legal proceedings that we believe will have a material impact on our consolidated financial position, results of operations or cash flows, we periodically become a party to legal proceedings in the ordinary course of business. PRODUCT WARRANTIES We maintain a warranty reserve that reflects management's best estimate of the cost to replace product that does not meet our specifications and customers' performance requirements, and costs related to such replacement. The warranty reserve is based upon a historical product replacement rate, adjusted for any specific known conditions or circumstances. Additions and deductions to the warranty reserve are recorded in cost of goods sold. Our warranty reserve requirements changed during fiscal 2015 as follows: Balance as of September 30, 2014 $ 246 Reserve for product warranty during the reporting period 608 Settlement of warranty (645 ) Balance as of September 30, 2015 $ 209 INDEMNIFICATION In the normal course of business, we are a party to a variety of agreements pursuant to which we may be obligated to indemnify the other party with respect to certain matters. Generally, these obligations arise in the context of agreements entered into by us, under which we customarily agree to hold the other party harmless against losses arising from items such as a breach of certain representations and covenants including title to assets sold, certain intellectual property rights and certain environmental matters. These terms are common in the industries in which we conduct business. In each of these circumstances, payment by us is subject to certain monetary and other limitations and is conditioned on the other party making an adverse claim pursuant to the procedures specified in the particular agreement, which typically allow us to challenge the other party's claims. We evaluate estimated losses for such indemnifications under the accounting standards related to contingencies and guarantees. We consider such factors as the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of loss. To date, we have not experienced material costs as a result of such obligations and, as of September 30, 2015, have not recorded any liabilities related to such indemnifications in our financial statements as we do not believe the likelihood of such obligations is probable. LEASE COMMITMENTS We lease certain vehicles, warehouse facilities, office space, machinery and equipment under cancelable and noncancelable leases, all of which expire within six years from September 30, 2015, and may be renewed by us. Rent expense under such arrangements during fiscal 2015, 2014 and 2013 totaled $2,195, $2,425 and $2,594, respectively. Future minimum rental commitments under noncancelable leases as of September 30, 2015 are as follows: Fiscal Year Operating 2016 $ 1,708 2017 1,380 2018 795 2019 719 2020 719 Thereafter 3,191 $ 8,512 PURCHASE OBLIGATIONS Purchase obligations include our take-or-pay arrangements with suppliers, and purchase orders and other obligations entered into in the normal course of business regarding the purchase of goods and services. We have been operating under a fumed silica supply agreement with Cabot Corporation, our former parent company which is not a related party, which had a termination date of December 31, 2016, which required us to purchase certain minimum quantities of fumed silica each year of the agreement, and to pay a shortfall if we purchased less than the minimum. This agreement was amended effective June 1, 2015 to, among other things, extend the term of the agreement through December 31, 2019, revise certain minimum purchase requirements through 2016, and provide us the option to purchase fumed silica for the remaining term of the agreement beyond calendar year 2016, for which we will pay a fee of $1,500 in each of calendar years 2017, 2018 and 2019. This fee is included in other long-term liabilities at its present value of $4,326 as of September 30, 2015. As of September 30, 2015, purchase obligations include $23,237 of contractual commitments related to our Cabot Corporation supply agreement for fumed silica. POSTRETIREMENT OBLIGATIONS IN FOREIGN JURISDICTIONS We have unfunded defined benefit plans covering employees in certain foreign jurisdictions as required by local law. Our plans in Japan, which represent the majority of our pension liability for such plans, had projected benefit obligations of $5,197 and $5,025 as of September 30, 2015 and 2014, respectively, and an accumulated benefit obligation of $3,941 and $3,782 as of September 30, 2015 and 2014, respectively. Key assumptions used in the actuarial measurement of the Japan pension liability include weighted average discount rates of 1.25% and 1.50% at September 30, 2015 and 2014, respectively, and an expected rate of compensation increase of 2.00% at both September 30, 2015 and 2014. Total future Japan pension costs included in accumulated other comprehensive income are $1,076 and $860 at September 30, 2015 and 2014, respectively. Our plans in Korea had defined benefit obligations of $1,155 and $849 as of September 30, 2015 and 2014. Key assumptions used in the actuarial measurement of the Korea pension liability include weighted average discount rates of 4.00% and 4.25% at September 30, 2015 and 2014, respectively, and an expected rate of compensation increase of 4.50% at both September 30, 2015 and 2014. Total future Korea pension costs included in accumulated other comprehensive income are $102 and $0 at September 30, 2015 and 2014, respectively. Benefit costs for the combined plans were $962, $652 and $686 in fiscal years 2015, 2014 and 2013, respectively, consisting primarily of service costs, are recorded as fringe benefit expense under cost of goods sold and operating expenses in our Consolidated Statement of Income. Estimated future benefit payments are as follows: Fiscal Year Amount 2016 172 2017 260 2018 210 2019 232 2020 352 2021 to 2025 2,188 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Sep. 30, 2015 | |
EARNINGS PER SHARE [Abstract] | |
EARNINGS PER SHARE | 18. EARNINGS PER SHARE Basic earnings per share (EPS) is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period, excluding the effects of unvested restricted stock awards with a right to receive non-forfeitable dividends, which are considered participating securities as prescribed by the two-class method under ASC 260. Diluted EPS is calculated in a similar manner, but the weighted-average number of common shares outstanding during the period is increased to include the weighted-average dilutive effect of "in-the-money" stock options and unvested restricted stock shares using the treasury stock method. The standards of accounting for earnings per share require companies to provide a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations. Basic and diluted earnings per share were calculated as follows: Year Ended September 30, 2015 2014 2013 Numerator: Net income $ 56,146 $ 50,751 $ 52,578 Less: income attributable to participating securities (483 ) (442 ) (506 ) Net income available to common shareholders $ 55,663 $ 50,309 $ 52,072 Denominator: Weighted-average common shares 24,039,692 23,704,024 22,924,056 (Denominator for basic calculation) Weighted-average effect of dilutive securities: Share-based compensation 592,123 906,884 836,010 Diluted weighted-average common shares 24,631,815 24,610,908 23,760,066 (Denominator for diluted calculation) Earnings per share: Basic $ 2.32 $ 2.12 $ 2.27 Diluted $ 2.26 $ 2.04 $ 2.19 For the twelve months ended September 30, 2015, 2014, and 2013, approximately 0.7 million, 0.5 million and 1.5 million shares, respectively, attributable to outstanding stock options were excluded from the calculation of diluted earnings per share because the exercise price of the options was greater than the average market price of our common stock and, therefore, their inclusion would have been anti-dilutive. |
FINANCIAL INFORMATION BY INDUST
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE | 12 Months Ended |
Sep. 30, 2015 | |
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE [Abstract] | |
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE | 19. FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE We operate predominantly in one industry segment – the development, manufacture, and sale of CMP consumables. Revenues are attributed to the United States and foreign regions based upon the customer location and not the geographic location from which our products were shipped. Financial information by geographic area was as follows: Year Ended September 30, 2015 2014 2013 Revenue: United States $ 55,989 $ 51,036 $ 53,955 Asia 328,669 347,669 347,797 Europe 29,439 25,961 31,379 Total $ 414,097 $ 424,666 $ 433,131 Property, plant and equipment, net: United States $ 43,239 $ 44,585 $ 47,436 Asia 50,504 56,236 64,546 Europe - - 3 Total $ 93,743 $ 100,821 $ 111,985 The following table shows revenue from sales to customers in foreign countries that accounted for more than ten percent of our total revenue in fiscal 2015, 2014 and 2013: Year Ended September 30, 2015 2014 2013 Revenue: Taiwan $ 124,460 $ 138,049 $ 133,273 South Korea 70,608 71,420 73,778 China 49,350 45,200 * * Denotes less than ten percent of total The following table shows net property, plant and equipment in foreign countries that accounted for more than ten percent of our total net property, plant and equipment in fiscal 2015, 2014 and 2013: Year Ended September 30, 2015 2014 2013 Property, plant and equipment, net: Japan $ 22,572 $ 27,110 $ 33,566 Taiwan 17,419 16,675 17,212 South Korea 9,658 11,564 12,591 The following table shows revenue generated by product area in fiscal 2015, 2014 and 2013: Year Ended September 30, 2015 2014 2013 Revenue: Tungsten slurries $ 178,770 $ 162,148 $ 155,904 Dielectric slurries 96,386 118,079 123,180 Other Metals slurries 71,640 76,605 76,367 Polishing pads 32,048 33,824 32,996 Engineered Surface Finishes 21,534 16,160 23,999 Data storage slurries 13,719 17,850 20,685 Total $ 414,097 $ 424,666 $ 433,131 |
SELECTED QUARTERLY OPERATING RE
SELECTED QUARTERLY OPERATING RESULTS | 12 Months Ended |
Sep. 30, 2015 | |
SELECTED QUARTERLY OPERATING RESULTS [Abstract] | |
SELECTED QUARTERLY OPERATING RESULTS | SELECTED QUARTERLY OPERATING RESULTS The following table presents our unaudited financial information for the eight quarterly periods ended September 30, 2015. This unaudited financial information has been prepared in accordance with accounting principles generally accepted in the United States of America, applied on a basis consistent with the annual audited financial statements and in the opinion of management, include all necessary adjustments, which consist only of normal recurring adjustments necessary to present fairly the financial results for the periods. The results for any quarter are not necessarily indicative of results for any future period. CABOT MICROELECTRONICS CORPORATION SELECTED QUARTERLY OPERATING RESULTS (Unaudited and in thousands, except per share amounts) Sept. 30, 2015 June 30, 2015 March 31, 2015 Dec. 31, 2014 Sept. 30, 2014 June 30, 2014 March 31, 2014 Dec. 31, 2013 Revenue $ 100,137 $ 97,168 $ 104,858 $ 111,934 $ 116,337 $ 108,358 $ 99,456 $ 100,515 Cost of goods sold 48,115 48,609 50,182 54,960 59,209 56,632 52,931 52,801 Gross profit 52,022 48,559 54,676 56,974 57,128 51,726 46,525 47,714 Operating expenses: Research, development and technical 14,856 14,773 15,131 15,018 15,051 15,368 14,364 14,571 Selling and marketing 5,763 5,804 5,777 7,639 6,846 6,489 6,471 6,707 General and administrative 13,553 12,830 14,296 11,751 12,236 11,380 11,076 10,726 Total operating expenses 34,172 33,407 35,204 34,408 34,133 33,237 31,911 32,004 Operating income 17,850 15,152 19,472 22,566 22,995 18,489 14,614 15,710 Interest expense 1,494 1,065 1,059 906 807 832 843 872 Other income (expense), net 116 (160 ) (332 ) 1,057 (448 ) (132 ) 103 617 Income before income taxes 16,472 13,927 18,081 22,717 21,740 17,525 13,874 15,455 Provision for income taxes 3,939 4,041 4,270 2,801 5,694 4,223 3,779 4,147 Net income $ 12,533 $ 9,886 $ 13,811 $ 19,916 $ 16,046 $ 13,302 $ 10,095 $ 11,308 Basic earnings per share $ 0.51 $ 0.40 $ 0.57 $ 0.83 $ 0.67 $ 0.55 $ 0.42 $ 0.47 Weighted average basic shares outstanding 24,144 24,333 24,057 23,651 23,500 23,753 23,982 23,590 Diluted earnings per share $ 0.50 $ 0.39 $ 0.55 $ 0.80 $ 0.65 $ 0.53 $ 0.40 $ 0.45 Weighted average diluted shares outstandin 24,583 24,813 24,693 24,486 24,334 24,613 24,897 24,623 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Sep. 30, 2015 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS | 20. SUBSEQUENT EVENT On October 22, 2015, the Company completed the acquisition of 100% of NexPlanar Corporation (NexPlanar), which was a privately held, U.S. based company that specializes in the development, manufacture and sale of advanced CMP pad solutions for the semiconductor industry. The purchase price of approximately $142,300 was paid in cash from our available cash balance. A portion of the purchase price was deposited with an escrow agent to fund payment obligations with respect to post-closing purchase price adjustments and indemnification obligations. This acquisition expands our polishing pad portfolio by adding a complementary pad technology. Due to the timing of this acquisition, certain disclosures, including the preliminary allocation of the purchase price and proforma financial information, have been omitted from this Annual Report on Form 10-K as the accounting was incomplete as of the filing date. These disclosures will be included in our filings with the SEC during fiscal 2016. |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Sep. 30, 2015 | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS [Abstract] | |
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS In Fiscal 2013, in relation to the bankruptcy filing of Elpida Memory, Inc., and subsequent approved bankruptcy plan, we charged off an accounts receivable balance against its related allowance for doubtful accounts. The following table sets forth activities in our allowance for doubtful accounts: Allowance For Doubtful Accounts Balance At Beginning of Year Amounts Charged To Expenses Deductions and Adjustments Balance At End Of Year Year ended: September 30, 2015 $ 1,392 $ (84 ) $ (84 ) $ 1,224 September 30, 2014 1,532 (170 ) 30 1,392 September 30, 2013 4,757 173 (3,398 ) 1,532 We maintain a warranty reserve that reflects management's best estimate of the cost to replace product that does not meet our specifications and customers' performance requirements, and costs related to such replacement. The warranty reserve is based upon a historical product replacement rate, adjusted for any specific known conditions or circumstances. Additions and deductions to the warranty reserve are recorded in cost of goods sold. Charges to expenses and deductions, shown below, represent the net change required to maintain an appropriate reserve. Warranty Reserves Balance At Beginning of Year Reserve For Product Warranty During the Reporting Period Adjustments To Pre-existing Warranty Reserve Settlement of Warranty Balance At End Of Year Year ended: September 30, 2015 $ 246 $ 608 $ - $ (645 ) $ 209 September 30, 2014 324 760 - (838 ) 246 September 30, 2013 359 874 - (909 ) 324 We have provided a valuation allowance on certain deferred tax assets. The following table sets forth activities in our valuation allowance: Valuation Allowance Balance At Beginning of Year Amounts Charged To Expenses Deductions and Adjustments Balance At End Of Year Year ended: September 30, 2015 $ 2,912 $ 167 $ - $ 3,079 September 30, 2014 2,288 624 - 2,912 September 30, 2013 1,378 910 - 2,288 |
SUMMARY OF SIGNIFICANT ACCOUN30
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Sep. 30, 2015 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
PRINCIPLES OF CONSOLIDATION | PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of Cabot Microelectronics and its subsidiaries. All intercompany transactions and balances between the companies have been eliminated as of September 30, 2015. |
USE OF ESTIMATES | USE OF ESTIMATES The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make judgments, assumptions and estimates that affect the amounts reported in the consolidated financial statements and accompanying notes. The accounting estimates that require management's most difficult and subjective judgments include, but are not limited to, those estimates related to bad debt expense, warranty obligations, inventory valuation, valuation and classification of auction rate securities, impairment of long-lived assets and investments, business combinations, goodwill, other intangible assets, interest rate swaps, share-based compensation, income taxes and contingencies. We base our estimates on historical experience, current conditions and on various other assumptions that we believe are reasonable under the circumstances. However, future events are subject to change and estimates and judgments routinely require adjustment. Actual results may differ from these estimates under different assumptions or conditions. |
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS | CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS We consider investments in all highly liquid financial instruments with original maturities of three months or less to be cash equivalents. Short-term investments include securities generally having maturities of 90 days to one year. We did not own any securities that were considered short-term as of September 30, 2015 or 2014. See Note 3 for a more detailed discussion of other financial instruments. |
ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS | ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS Trade accounts receivable are recorded at the invoiced amount and do not bear interest. We maintain an allowance for doubtful accounts for estimated losses resulting from the potential inability of our customers to make required payments. Our allowance for doubtful accounts is based on historical collection experience, adjusted for any specific known conditions or circumstances such as customer bankruptcies and increased risk due to economic conditions. Uncollectible account balances are charged against the allowance when we believe that it is probable that the receivable will not be recovered. Accounts receivable, net of allowances for doubtful accounts, were $49,405 as of September 30, 2015 and $60,693 as of September 30, 2014. The decrease in accounts receivable was primarily due to the 13.9% decrease in revenue in the fourth quarter of fiscal 2015 compared to the same period in fiscal 2014. Amounts charged to bad debt expense are recorded in general and administrative expenses. A portion of our receivables and the related allowance for doubtful accounts is denominated in foreign currencies, so they are subject to foreign exchange fluctuations which are included in the table below under deductions and adjustments. Our allowance for doubtful accounts changed during the fiscal year ended September 30, 2015 as follows: Balance as of September 30, 2014 $ 1,392 Amounts charged to expense (84 ) Deductions and adjustments (84 ) Balance as of September 30, 2015 $ 1,224 |
CONCENTRATION OF CREDIT RISK | CONCENTRATION OF CREDIT RISK Financial instruments that subject us to concentrations of credit risk consist principally of accounts receivable. We perform ongoing credit evaluations of our customers' financial conditions and generally do not require collateral to secure accounts receivable. Our exposure to credit risk associated with nonpayment is affected principally by conditions or occurrences within the semiconductor industry and global economy. With the exception of one customer bankruptcy in fiscal 2012, we have not experienced significant losses relating to accounts receivable from individual customers or groups of customers. Customers who represented more than 10% of revenue are as follows: Year Ended September 30, 2015 2014 2013 Taiwan Semiconductor Manufacturing Co. (TSMC) 18% 22% 21% Samsung Group (Samsung) 15% 14% 13% TSMC accounted for 12.6% and 19.4% of net accounts receivable at September 30, 2015 and 2014, respectively. Samsung accounted for 9.7% and 10.2% of net accounts receivable at September 30, 2015 and 2014, respectively. |
FAIR VALUES OF FINANCIAL INSTRUMENTS | FAIR VALUES OF FINANCIAL INSTRUMENTS The recorded amounts of cash, accounts receivable, and accounts payable approximate their fair values due to their short-term, highly liquid characteristics. See Note 3 for a more detailed discussion of the fair value of financial instruments. |
INVENTORIES | INVENTORIES Inventories are stated at the lower of cost, determined on the first-in, first-out (FIFO) basis, or market. Finished goods and work in process inventories include material, labor and manufacturing overhead costs. We regularly review and write down the value of inventory as required for estimated obsolescence or lack of marketability. An inventory reserve is maintained based upon a historical percentage of actual inventories written off and applied against inventory value at the end of the period, adjusted for known conditions and circumstances. |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are recorded at cost. Depreciation is based on the following estimated useful lives of the assets using the straight-line method: Buildings 15-25 years Machinery and equipment 3-10 years Furniture and fixtures 5-10 years Information systems 3-5 years Expenditures for repairs and maintenance are charged to expense as incurred. Expenditures for major renewals and betterments are capitalized and depreciated over the remaining useful lives. As assets are retired or sold, the related cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations. We capitalize the costs related to the design and development of software used for internal purposes; however, these costs are not material. |
IMPAIRMENT OF LONG-LIVED ASSETS | IMPAIRMENT OF LONG-LIVED ASSETS Reviews are regularly performed to determine whether facts and circumstances exist that indicate the carrying amount of assets may not be recoverable or the useful life is shorter than originally estimated. Asset recoverability assessment begins by comparing the projected undiscounted cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Impairment, if any, is based on the excess of the carrying amount over the fair value of those assets. If assets are determined to be recoverable, but their useful lives are shorter than originally estimated, the net book value of the asset is depreciated over the newly determined remaining useful life. See Note 5 for more information regarding impairment expense recorded in fiscal years 2015, 2014 and 2013. |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS We amortize intangible assets with finite lives over their estimated useful lives, which range from one to ten years. Intangible assets with finite lives are reviewed for impairment using a process similar to that used to evaluate other long-lived assets. Goodwill and indefinite-lived intangible assets are not amortized and are tested annually in the fourth fiscal quarter, or more frequently if indicators of potential impairment exist, using a fair-value-based approach. The recoverability of goodwill is measured at the reporting unit level, which is defined as either an operating segment or one level below an operating segment, referred to as a component. A component is a reporting unit when the component constitutes a business for which discreet financial information is available and segment management regularly reviews the operating results of the component. Components may be combined into one reporting unit when they have similar economic characteristics. We have four reporting units, three of which have goodwill and intangible assets as of September 30, 2015. Goodwill impairment testing requires a comparison of the fair value of each reporting unit to the carrying value. If the carrying value exceeds fair value, then the fair value of the assets and liabilities for the reporting unit is used to determine the "implied" fair value of goodwill. The amount of the impairment is the difference between the carrying value and the implied fair value of goodwill. The fair value of the reporting unit may be determined using a discounted cash flow analysis of our projected future results. An entity has the option to assess qualitative factors to determine if the two-step impairment test must be performed. We elected to perform a discounted cash flow analysis in fiscal 2015 when we performed our annual impairment review of goodwill. An entity also has the option to assess qualitative factors in its impairment review of indefinite-lived intangible assets. However, we elected to use the royalty savings method in fiscal 2015 when we performed our impairment review of our indefinite-lived intangible assets. We determined that goodwill and other intangible assets were not impaired as of September 30, 2015, as the fair value of our reporting units was substantially in excess of carrying value. |
WARRANTY RESERVE | WARRANTY RESERVE We maintain a warranty reserve that reflects management's best estimate of the cost to replace product that does not meet our specifications and customers' performance requirements. The warranty reserve is based upon a historical product return rate, adjusted for any specific known conditions or circumstances. Adjustments to the warranty reserve are recorded in cost of goods sold. |
FOREIGN CURRENCY TRANSLATION | FOREIGN CURRENCY TRANSLATION Certain operating activities in Asia and Europe are denominated in local currency, considered to be the functional currency. Assets and liabilities of these operations are translated using exchange rates in effect at the end of the year, and revenue and costs are translated using average exchange rates for the year. The related translation adjustments are reported in comprehensive income in stockholders' equity. |
FOREIGN EXCHANGE MANAGEMENT | FOREIGN EXCHANGE MANAGEMENT We transact business in various foreign currencies, primarily the Japanese yen, New Taiwan dollar and Korean won. Our exposure to foreign currency exchange risks has not been significant because a large portion of our business is denominated in U.S. dollars. However, there was a weakening of the Japanese yen against the U.S. dollar during fiscal years 2013, 2014 and 2015, which had some net positive impact on our gross margin percentage and our net income. Periodically, we enter into forward foreign exchange contracts in an effort to mitigate the risks associated with currency fluctuations on certain foreign currency balance sheet exposures. Our foreign exchange contracts do not qualify for hedge accounting under the accounting rules for derivative instruments. See Note 10 for a discussion of derivative financial instruments. INTERCOMPANY LOAN ACCOUNTING |
INTERCOMPANY LOAN ACCOUNTING | We maintain an intercompany loan agreement with our wholly-owned subsidiary, Nihon Cabot Microelectronics K.K. ("Nihon"), under which we provided funds to Nihon to finance the purchase of certain assets from our former Japanese branch at the time of the establishment of this subsidiary, for the purchase of land adjacent to our Geino, Japan, facility, for the construction of our Asia Pacific technology center, and for the purchase of a 300 millimeter polishing tool and related metrology equipment, all of which are part of Nihon, as well as for general business purposes. Since settlement of the note is expected in the foreseeable future, and our subsidiary has been consistently making timely payments on the loan, the loan is considered a foreign-currency transaction. Therefore the associated foreign exchange gains and losses are recognized as other income or expense rather than being deferred in the cumulative translation account in other comprehensive income. We also maintain an intercompany loan between two of our wholly-owned foreign subsidiaries, from Cabot Microelectronics Singapore Pte. Ltd. to Hanguk Cabot Microelectronics, LLC in South Korea. This loan provided funds for the construction and operation of our research, development and manufacturing facility in South Korea. This loan is also considered a foreign currency transaction and is accounted for in the same manner as our intercompany loan to Nihon. |
PURCHASE COMMITMENTS | PURCHASE COMMITMENTS We have entered into unconditional purchase obligations, which include noncancelable purchase commitments and take-or-pay arrangements with suppliers. On an ongoing basis, we review our agreements and assess the likelihood of a shortfall in purchases and determine if it is necessary to record a liability. To date, we have not recorded such a liability. |
REVENUE RECOGNITION | REVENUE RECOGNITION Revenue from CMP consumables products is recognized when title is transferred to the customer, assuming all revenue recognition criteria are met. Title transfer generally occurs upon shipment to the customer or when inventory held on consignment is consumed by the customer, subject to the terms and conditions of the particular customer arrangement. We have consignment agreements with a number of our customers that require, at a minimum, monthly consumption reports that enable us to record revenue and inventory usage in the appropriate period. Although the vast majority of our products are sold directly, we market some of our products through distributors in certain areas of the world. We recognize revenue upon shipment and when title is transferred to the distributor. We do not have any arrangements with distributors that include payment terms, rights of return, or rights of exchange outside the ordinary course of business, or any other significant matters that we believe would impact the timing of revenue recognition. Within our Engineered Surface Finishes (ESF) business, sales of equipment are recorded as revenue upon delivery and customer acceptance. Amounts allocated to installation and training are deferred until those services are provided and are not material. Revenues are reported net of any value-added tax or other such tax assessed by a governmental authority on our revenue-producing activities. |
SHIPPING AND HANDLING | SHIPPING AND HANDLING Costs related to shipping and handling are included in cost of goods sold. |
RESEARCH, DEVELOPMENT AND TECHNICAL | RESEARCH, DEVELOPMENT AND TECHNICAL Research, development and technical costs are expensed as incurred and consist primarily of staffing costs, materials and supplies, depreciation, utilities and other facilities costs. |
INCOME TAXES | INCOME TAXES Current income taxes are determined based on estimated taxes payable or refundable on tax returns for the current year. Deferred income taxes are determined using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Provisions are made for both U.S. and any foreign deferred income tax liability or benefit. We assess whether our deferred tax assets will ultimately be realized and record an estimated valuation allowance on those deferred tax assets that may not be realized. We recognize the tax benefit of an uncertain tax position only if it is more likely than not that the tax position will be sustained by the taxing authorities, based on the technical merits of the position. In fiscal 2012, we elected to permanently reinvest the earnings of certain of our foreign subsidiaries outside the U.S. rather than repatriate the earnings to the U.S. In fiscal years 2013, 2014 and 2015, we elected to permanently reinvest the earnings of all of our foreign subsidiaries. See Note 16 for additional information on income taxes. |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION We record share-based compensation expense for all share-based awards, including stock option grants, restricted stock and restricted stock unit awards and employee stock purchase plan purchases. We calculate share-based compensation expense using the straight-line approach based on awards ultimately expected to vest, which requires the use of an estimated forfeiture rate. Our estimated forfeiture rate is primarily based on historical experience, and is revised from time-to-time when actual forfeitures differ from the estimate. We use the Black-Scholes option-pricing model to estimate the grant date fair value of our stock options and employee stock purchase plan purchases. This model requires the input of highly subjective assumptions, including the price volatility of the underlying stock, the expected term of our stock options and the risk-free interest rate. We estimate the expected volatility of our stock options based on a combination of our stock's historical volatility and the implied volatilities from actively-traded options on our stock. We calculate the expected term of our stock options using historical stock option exercise data, and we add a premium to this expected term for employees who meet the definition of retirement eligible pursuant to their grants during the contractual term of the grant. The risk-free rate is derived from the U.S. Treasury yield curve in effect at the time of grant. The fair value of our restricted stock and restricted stock unit awards represents the closing price of our common stock on the date of award. For additional information regarding our share-based compensation plans, refer to Note 12. |
EARNINGS PER SHARE | EARNINGS PER SHARE Basic earnings per share (EPS) is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period, excluding the effects of unvested restricted stock awards with a right to receive non-forfeitable dividends, which are considered participating securities as prescribed by the two class method under ASC Topic 260, Earnings Per Share (ASC 260). Diluted EPS is calculated in a similar manner, but the weighted-average number of common shares outstanding during the period is increased to include the weighted-average dilutive effect of "in-the-money" stock options and unvested restricted stock shares using the treasury stock method. |
COMPREHENSIVE INCOME | COMPREHENSIVE INCOME Comprehensive income primarily differs from net income due to foreign currency translation adjustments. |
INTEREST RATE SWAPS | INTEREST RATE SWAPS In the first quarter of fiscal 2015, we entered into floating-to-fixed interest rate swap agreements to hedge the variability in LIBOR-based interest payments on a portion of our outstanding variable rate debt. The fair value of our interest rate swaps is estimated using standard valuation models using market-based observable inputs over the contractual term, including one-month LIBOR-based yield curves, among others. We consider the risk of nonperformance, including counterparty credit risk, in the calculation of the fair value. We have designated these swap agreements as cash flow hedges pursuant to ASC 815, "Derivatives and Hedging". As cash flow hedges, unrealized gains are recognized as assets and unrealized losses are recognized as liabilities. Unrealized gains and losses are designated as effective or ineffective based on a comparison of the changes in fair value of the interest rate swaps and changes in fair value of the underlying exposures being hedged. The effective portion is recorded as a component of accumulated other comprehensive income or loss, while the ineffective portion is recorded as a component of interest expense. Changes in the method by which we pay interest from one-month LIBOR to another rate of interest could create ineffectiveness in the swaps, and result in amounts being reclassified from other comprehensive income into net income. Hedge effectiveness is tested quarterly to determine if hedge treatment is appropriate. |
EFFECTS OF RECENT ACCOUNTING PRONOUNCEMENTS | EFFECTS OF RECENT ACCOUNTING PRONOUNCEMENTS In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers" (Topic 606), an updated standard on revenue recognition . In June 2014, the FASB issued ASU No. 2014-12, "Accounting for Share-Based Payments When the Terms of an Award Provide that a Performance Target Could be Achieved after the Requisite Service Period" (Topic 718) . In January 2015, the FASB issued ASU No. 2015-01, "Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items" (Subtopic 225-20) . In February 2015, the FASB issued ASU No. 2015-02, "Amendments to the Consolidation Analysis" (Topic 810) . In April 2015, the FASB issued ASU No. 2015-03, "Simplifying the Presentation of Debt Issuance Costs" (Subtopic 835-30). The provisions of ASU 2015-03 require an entity to present the debt issuance costs related to a recognized debt liability in the balance sheet as a direct deduction to the carry amount of that debt liability. ASU 2015-03 will be effective for us beginning October 1, 2016, but early adoption is permitted. The implementation of this standard will require us to reclassify our debt issuance costs from their asset position on our balance sheet to a liability position as an offset to the carrying amount of our outstanding debt. We are considering early adoption of ASU 2015-03 in fiscal 2016; the implementation is not expected to have a material effect on our financial statements. In April 2015, the FASB issued ASU No. 2015-05, "Customer Accounting for Fees Paid in a Cloud Computing Arrangement" (Subtopic 350-40). ASU 2015-05 provides guidance to entities on accounting for entering into a cloud computing arrangement with and without a software license. If an arrangement includes a software license, then the purchaser should account for the software license element of the arrangement consistent with the treatment of other software licenses. If an arrangement does not include a software license, it should be treated as a service contract. ASU 2015-05 will be effect for us beginning October 1, 2016, but early adoption is permitted. We are currently evaluating the impact of implementation of this standard on our financial statements. In July 2015, the FASB issued ASU No, 2015-11, "Simplifying the Measurement of Inventory" (Topic 330). The provisions of ASU 2015-11 require an entity to measure inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonable predictable costs of completion, disposal, and transportation. ASU 2015-11 will be effective for us beginning October 1, 2017 but early adoption is permitted. We do not believe the adoption of this standard will have a material effect on our financial statements. In August 2015, the FASB issued ASU No. 2015-15, "Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements" (Subtopic 835-30). ASU 2015-15 provides guidance on the treatment of debt issuance cost related to line-of-credit arrangements based on comments provided by the SEC staff. The SEC staff stated that it would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance cost ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. ASU 2015-15 will be effective for us beginning October 1, 2016, but early adoption is permitted. We are currently evaluating the impact of implementation of this standard on our financial statements. In September 2015, the FASB issued ASU No. 2015-16, "Simplifying the Accounting for Measurement Period Adjustments" (Topic 805). The provisions of ASU 2015-16 require an acquirer to recognize adjustments to provisional amounts identified during the measurement period in the reporting period in which the adjustment amounts are determined. ASU 2015-16 requires an acquirer to record, in the same period's financial statements, the effect on earnings of changes in depreciation, amortization or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the account had been completed at the acquisition date. ASU 2015-16 also requires an entity to present separately on the face of the income statement or disclose in the footnotes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustments had been recognized as of the acquisition date. ASU 2015-16 will be effective for us beginning October 1, 2017, but early adoption is permitted. We are currently evaluating the impact of implementation of this standard on our financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN31
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Schedule of Allowance for Doubtful Accounts | Accounts receivable, net of allowances for doubtful accounts, were $49,405 as of September 30, 2015 and $60,693 as of September 30, 2014. The decrease in accounts receivable was primarily due to the 13.9% decrease in revenue in the fourth quarter of fiscal 2015 compared to the same period in fiscal 2014. Amounts charged to bad debt expense are recorded in general and administrative expenses. A portion of our receivables and the related allowance for doubtful accounts is denominated in foreign currencies, so they are subject to foreign exchange fluctuations which are included in the table below under deductions and adjustments. Our allowance for doubtful accounts changed during the fiscal year ended September 30, 2015 as follows: Balance as of September 30, 2014 $ 1,392 Amounts charged to expense (84 ) Deductions and adjustments (84 ) Balance as of September 30, 2015 $ 1,224 |
Schedule of Customers Representing More than Ten Percent of Total Revenue | Customers who represented more than 10% of revenue are as follows: Year Ended September 30, 2015 2014 2013 Taiwan Semiconductor Manufacturing Co. (TSMC) 18% 22% 21% Samsung Group (Samsung) 15% 14% 13% |
Schedule of Property, Plant and Equipment Useful Lives | Property, plant and equipment are recorded at cost. Depreciation is based on the following estimated useful lives of the assets using the straight-line method: Buildings 15-25 years Machinery and equipment 3-10 years Furniture and fixtures 5-10 years Information systems 3-5 years |
FAIR VALUE OF FINANCIAL INSTR32
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract] | |
Schedule of Fair Value of Financial Instruments | The following table presents financial instruments, other than long-term debt, that we measured at fair value on a recurring basis at September 30, 2015 and 2014. September 30, 2015 Level 1 Level 2 Level 3 Total Fair Value Assets: Cash and cash equivalents $ 354,190 $ - $ - $ 354,190 Other long-term investments 1,720 - - 1,720 Derivative financial instruments - 14 - 14 Total assets $ 355,910 $ 14 $ - $ 355,924 Liabilities: Derivative financial instruments - 1,406 - 1,406 Total liabilities $ - $ 1,406 $ - $ 1,406 September 30, 2014 Level 1 Level 2 Level 3 Total Fair Value Assets: Cash and cash equivalents $ 284,155 $ - $ - $ 284,155 Other long-term investments 1,654 - - 1,654 Derivative financial instruments - 100 - 100 Total assets $ 285,809 $ 100 $ - $ 285,909 Liabilities: Derivative financial instruments - 270 - 270 Total liabilities $ - $ 270 $ - $ 270 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
INVENTORIES [Abstract] | |
Schedule of Inventories | Inventories consisted of the following: September 30, 2015 2014 Raw materials $ 42,603 $ 37,009 Work in process 5,487 4,505 Finished goods 22,588 23,465 Total $ 70,678 $ 64,979 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
PROPERTY, PLANT AND EQUIPMENT [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment consisted of the following: September 30, 2015 2014 Land $ 17,076 $ 17,834 Buildings 92,720 97,513 Machinery and equipment 167,448 171,461 Furniture and fixtures 6,172 6,224 Information systems 28,528 27,673 Construction in progress 7,553 3,166 Total property, plant and equipment 319,497 323,871 Less: accumulated depreciation (225,754 ) (223,050 ) Net property, plant and equipment $ 93,743 $ 100,821 |
GOODWILL AND OTHER INTANGIBLE35
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
GOODWILL AND OTHER INTANGIBLE ASSETS [Abstract] | |
Components of Other Intangible Assets | The components of other intangible assets are as follows: September 30, 2015 September 30, 2014 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Other intangible assets subject to amortization: Product technology $ 8,053 $ 7,490 $ 8,278 $ 6,750 Acquired patents and licenses 8,270 7,845 8,270 7,534 Trade secrets and know-how 2,550 2,550 2,550 2,550 Customer relationships, distribution rights and other 11,392 9,005 12,193 8,484 Total other intangible assets subject to amortization 30,265 26,890 31,291 25,318 Total other intangible assets not subject to amortization* 1,190 1,190 Total other intangible assets $ 31,455 $ 26,890 $ 32,481 $ 25,318 * Total other intangible assets not subject to amortization primarily consist of trade names. |
Estimated Future Amortization Expense for the Succeeding Five Fiscal Years | Amortization expense was $2,346, $2,474 and $2,622 for fiscal 2015, 2014 and 2013, respectively. Estimated future amortization expense of intangible assets as of September 30, 2015 for the five succeeding fiscal years is as follows: Fiscal Year Estimated Amortization Expense 2016 $ 1,875 2017 1,064 2018 419 2019 11 2020 6 |
OTHER LONG-TERM ASSETS (Tables)
OTHER LONG-TERM ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
OTHER LONG-TERM ASSETS [Abstract] | |
Schedule of Other Long-Term Assets | Other long-term assets consisted of the following: September 30, 2015 2014 Auction rate securities (ARS) $ 5,694 $ 5,895 Other long-term assets 3,595 3,043 Long-term contract asset 3,995 - Other long-term investments 1,720 1,654 Total $ 15,004 $ 10,592 |
ACCRUED EXPENSES, INCOME TAXE37
ACCRUED EXPENSES, INCOME TAXES PAYABLE AND OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
ACCRUED EXPENSES, INCOME TAXES PAYABLE AND OTHER CURRENT LIABILITIES [Abstract] | |
Schedule of Accrued Expenses, Income Taxes Payable and Other Current Liabilities | Accrued expenses, income taxes payable and other current liabilities consisted of the following: September 30, 2015 2014 Accrued compensation $ 23,793 $ 16,980 Goods and services received, not yet invoiced 1,830 3,167 Deferred revenue and customer advances 538 1,223 Warranty accrual 209 246 Income taxes payable 4,276 5,448 Taxes, other than income taxes 975 1,182 Other 4,825 3,148 Total $ 36,446 $ 31,394 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
DEBT [Abstract] | |
Schedule of Maturities of Long-Term Debt | Principal repayments of the Term Loan are generally made on the last calendar day of each quarter if that day is considered to be a business day. As of September 30, 2015, scheduled principal repayments of the Term Loan were as follows: Fiscal Year Principal Repayments 2016 $ 8,750 2017 7,656 2018 14,219 2019 133,438 Total $ 164,063 |
DERIVATIVE FINANCIAL INSTRUME39
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
DERIVATIVE FINANCIAL INSTRUMENTS [Abstract] | |
Schedule of Fair Value of Derivative Instruments in the Consolidated Balance Sheet | The fair value of our derivative instruments included in the Consolidated Balance Sheet, which was determined using level 2 inputs, was as follows: Asset Derivatives Liability Derivatives Balance Sheet Location Fair value at September 30, 2015 Fair Value at September 30, 2014 Fair Value at September 30, 2015 Fair Value at September 30, 2014 Derivatives designated as hedging instruments Interest rate swap contracts Other noncurrent assets $ - $ - $ - $ - Accrued expenses and other current liabilities $ - $ - $ 885 $ - Other long-term liabilities $ - $ - $ 513 $ - Derivatives not designated as hedging instruments Foreign exchange contracts Prepaid expenses and other current assets $ 14 $ 100 $ - $ - Accrued expenses and other current liabilities $ - $ - $ 8 $ 270 |
Schedule of the Effect of Derivative Instruments on the Consolidated Statement of Income | The following table summarizes the effect of our derivative instrument on our Consolidated Statement of Income for the fiscal years ended September 30, 2015, 2014 and 2013: Gain (Loss) Recognized in Statement of Income Fiscal Year Ended Derivatives not designated as hedging instruments Statement of Income Location September 30, 2015 September 30, 2014 September 30, 2014 Foreign exchange contracts Other income (expense), net $ (1,674 ) $ (1,289 ) $ 252 |
ACCUMULATED OTHER COMPREHENSI40
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The table below summarizes the components of accummulated other comprehensive income (loss), net of tax for the years ended September 30, 2015, 2014, and 2013. Foreign Currency Translation Cash Flow Hedges Other Postretirement Liabilities Marketable Securities Total Balance at September 30, 2012 $ 31,288 $ - $ (671 ) $ (151 ) $ 30,466 Foreign currency translation adjustment, net of tax of $(3,187) (13,037 ) - - - (13,037 ) Change in pension and other postretirement, net of tax of $0 - - 7 - 7 Balance at September 30, 2013 18,251 - (664 ) (151 ) 17,436 Foreign currency translation adjustment, net of tax of $(1,597) (8,136 ) - - (8,136 ) Unrealized gain (loss) on marketable securities - - - 151 151 Change in pension and other postretirement, net of tax of $0 - - (196 ) - (196 ) Balance at September 30, 2014 10,115 - (860 ) - 9,255 Foreign currency translation adjustment, net of tax of $(1,731) (14,126 ) - - - (14,126 ) Unrealized gain (loss) on cash flow hedges Change in fair value, net of tax of $(833) - (1,511 ) - - (1,511 ) Reclassification adjustment into earnings, net of tax of $336 - 610 - - 610 Change in pension and other postretirement, net of tax of $0 - - (318 ) - (318 ) Balance at September 30, 2015 $ (4,011 ) $ (901 ) $ (1,178 ) $ - $ (6,090 ) |
SHARE-BASED COMPENSATION PLANS
SHARE-BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
SHARE-BASED COMPENSATION PLANS [Abstract] | |
Schedule of Fair Value Assumptions and Methodology | The fair value of our share-based awards, as shown below, was estimated using the Black-Scholes model with the following weighted-average assumptions, excluding the effect of our leveraged recapitalization: Year Ended September 30, 2015 2014 2013 Stock Options Weighted-average grant date fair value $ 16.99 $ 15.78 $ 12.13 Expected term (in years) 6.30 6.40 6.37 Expected volatility 33 % 32 % 36 % Risk-free rate of return 1.9 % 1.9 % 0.9 % Dividend yield - - - ESPP Weighted-average grant date fair value $ 10.17 $ 9.11 $ 7.41 Expected term (in years) 0.50 0.50 0.50 Expected volatility 24 % 25 % 25 % Risk-free rate of return 0.1 % 0.1 % 0.1 % Dividend yield - - - |
Share Based Compensation Expense | Total share-based compensation expense for the years ended September 30, 2015, 2014 and 2013, is as follows: Year Ended September 30, Income statement classifications: 2015 2014 2013 Cost of goods sold $ 1,912 $ 1,866 $ 1,707 Research, development and technical 1,596 1,475 1,301 Selling and marketing 1,075 1,298 1,367 General and administrative 11,862 9,403 8,975 Tax benefit (5,511 ) (4,722 ) (4,581 ) Total share-based compensation expense, net of tax $ 10,934 $ 9,320 $ 8,769 |
Summary of Stock Option Activity | A summary of stock option activity under the EIP and OIP as of September 30, 2015, and changes during fiscal 2015 are presented below: Stock Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Outstanding at September 30, 2014 3,272,898 $ 29.04 Granted 397,528 47.00 Exercised (1,324,646 ) 25.05 Forfeited or canceled (185,987 ) 39.41 Outstanding at September 30, 2015 2,159,793 $ 33.90 6.5 $ 15,376 Exercisable at September 30, 2015 1,256,818 $ 28.95 5.4 $ 12,995 Expected to vest after September 30, 2015 901,535 $ 40.77 8.1 $ 2,381 |
Summary of Restricted Stock Awards and Restricted Stock Unit Awards | A summary of the status of the restricted stock awards and restricted stock unit awards outstanding that were granted under the EIP and OIP as of September 30, 2015, and changes during fiscal 2015, are presented below: Restricted Stock Awards and Units Weighted Average Grant Date Fair Value Nonvested at September 30, 2014 398,099 $ 39.11 Granted 228,492 47.13 Vested (180,417 ) 40.03 Forfeited (63,678 ) 41.63 Nonvested at September 30, 2015 382,496 $ 43.05 |
OTHER INCOME (EXPENSE), NET (Ta
OTHER INCOME (EXPENSE), NET (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
OTHER INCOME, NET [Abstract] | |
Other Income (Expense), Net | Other income (expense), net, consisted of the following: Year Ended September 30, 2015 2014 2013 Interest income $ 365 $ 194 $ 145 Other income (expense) 316 (54 ) 1,247 Total other income, net $ 681 $ 140 $ 1,392 |
STOCKHOLDERS EQUITY (Tables)
STOCKHOLDERS EQUITY (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
STOCKHOLDERS EQUITY [Abstract] | |
Summary of Capital Stock Activity | The following is a summary of our capital stock activity over the past three years: Number of Shares Common Stock Treasury Stock September 30, 2012 28,864,527 5,682,288 Exercise of stock options 1,071,750 Restricted stock under EIP, net of forfeitures 185,925 Restricted stock under Deposit Share Plan, net of forfeitures 6,773 Common stock under ESPP 84,602 Repurchases of common stock under share repurchase plans 1,144,836 Repurchases of common stock – other 39,551 September 30, 2013 30,213,577 6,866,675 Exercise of stock options 1,449,002 Restricted stock under EIP and OIP, net of forfeitures 176,026 Restricted stock under Deposit Share Plan, net of forfeitures 7,296 Common stock under ESPP 81,700 Repurchases of common stock under share repurchase plans 1,229,494 Repurchases of common stock – other 46,518 September 30, 2014 31,927,601 8,142,687 Exercise of stock options 1,324,646 Restricted stock under EIP and OIP, net of forfeitures 172,010 Restricted stock under Deposit Share Plan, net of forfeitures (811) Common stock under ESPP 65,735 Repurchases of common stock under share repurchase plans 851,245 Repurchases of common stock – other 47,746 September 30, 2015 33,489,181 9,041,678 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
INCOME TAXES [Abstract] | |
Schedule of Income Before Income Taxes | Income before income taxes was as follows: Year Ended September 30, 2015 2014 2013 Domestic $ 15,305 $ 14,358 $ 40,045 Foreign 55,892 54,236 34,175 Total $ 71,197 $ 68,594 $ 74,220 |
Schedule of Taxes on Income by Jurisdiction | Taxes on income consisted of the following: Year Ended September 30, 2015 2015 2013 U.S. federal and state: Current $ 6,496 $ 8,978 $ 18,060 Deferred 1,791 488 (3,494 ) Total $ 8,287 $ 9,466 $ 14,566 Foreign: Current $ 7,686 $ 9,565 $ 8,304 Deferred (922 ) (1,188 ) (1,228 ) Total 6,764 8,377 7,076 Total U.S. and foreign $ 15,051 $ 17,843 $ 21,642 |
Income Tax Rate Reconciliation | The provision for income taxes at our effective tax rate differed from the statutory rate as follows: Year Ended September 30, 2015 2014 2013 Federal statutory rate 35.0% 35.0% 35.0% U.S. benefits from research and experimentation activities (2.2) (0.6) (2.0) State taxes, net of federal effect 0.6 0.8 0.3 Foreign income at other than U.S. rates (21.4) (9.4) (5.3) Change in valuation allowance 0.0 0.0 1.4 Executive compensation 0.6 0.4 0.2 Share-based compensation 0.1 0.1 0.5 Adjustment of prior amounts 1.4 0.1 0.1 Taiwan Restructuring 7.2 - - Domestic production deduction (1.3) (0.3) (0.2) Other, net 1.1 (0.1) (0.8) Provision for income taxes 21.1% 26.0% 29.2% |
Reconciliation of Gross Unrecognized Tax Benefits | The following table presents the changes in the balance of gross unrecognized tax benefits during the last three fiscal years: Balance September 30, 2012 $ 283 Additions for tax positions relating to the current fiscal year 228 Additions for tax positions relating to prior fiscal years 247 Settlements with taxing authorities - Lapse of statute of limitations - Balance September 30, 2013 758 Additions for tax positions relating to the current fiscal year 59 Additions for tax positions relating to prior fiscal years 125 Settlements with taxing authorities (207 ) Lapse of statute of limitations (34 ) Balance September 30, 2014 701 Additions for tax positions relating to the current fiscal year 194 Additions for tax positions relating to prior fiscal years 1,400 Settlements with taxing authorities (522 ) Lapse of statute of limitations - Balance September 30, 2015 $ 1,773 |
Schedule of Significant Components of Deferred Income Tax | Significant components of net deferred tax assets and liabilities were as follows: September 30, 2015 2014 Deferred tax assets: Employee benefits $ 4,061 $ 3,889 Inventory 3,271 3,385 Bad debt reserve 391 515 Share-based compensation expense 9,863 12,150 Net operating losses 556 641 Depreciation and amortization 1,263 267 Other 3,599 3,084 Valuation allowance (3,079 ) (2,912 ) Total deferred tax assets $ 19,925 $ 21,019 Deferred tax liabilities: Translation adjustment $ 55 $ 1,615 Other 339 1,040 Total deferred tax liabilities $ 394 $ 2,655 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
Schedule of Product Warranty Reserve Activity | We maintain a warranty reserve that reflects management's best estimate of the cost to replace product that does not meet our specifications and customers' performance requirements, and costs related to such replacement. The warranty reserve is based upon a historical product replacement rate, adjusted for any specific known conditions or circumstances. Additions and deductions to the warranty reserve are recorded in cost of goods sold. Our warranty reserve requirements changed during fiscal 2015 as follows: Balance as of September 30, 2014 $ 246 Reserve for product warranty during the reporting period 608 Settlement of warranty (645 ) Balance as of September 30, 2015 $ 209 |
Future Minimum Rental Commitments Under Noncancelable Leases | Future minimum rental commitments under noncancelable leases as of September 30, 2015 are as follows: Fiscal Year Operating 2016 $ 1,708 2017 1,380 2018 795 2019 719 2020 719 Thereafter 3,191 $ 8,512 |
Estimated Future Benefit Payments | Benefit costs for the combined plans were $962, $652 and $686 in fiscal years 2015, 2014 and 2013, respectively, consisting primarily of service costs, are recorded as fringe benefit expense under cost of goods sold and operating expenses in our Consolidated Statement of Income. Estimated future benefit payments are as follows: Fiscal Year Amount 2016 172 2017 260 2018 210 2019 232 2020 352 2021 to 2025 2,188 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
EARNINGS PER SHARE [Abstract] | |
Earnings Per Share | The standards of accounting for earnings per share require companies to provide a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations. Basic and diluted earnings per share were calculated as follows: Year Ended September 30, 2015 2014 2013 Numerator: Net income $ 56,146 $ 50,751 $ 52,578 Less: income attributable to participating securities (483 ) (442 ) (506 ) Net income available to common shareholders $ 55,663 $ 50,309 $ 52,072 Denominator: Weighted-average common shares 24,039,692 23,704,024 22,924,056 (Denominator for basic calculation) Weighted-average effect of dilutive securities: Share-based compensation 592,123 906,884 836,010 Diluted weighted-average common shares 24,631,815 24,610,908 23,760,066 (Denominator for diluted calculation) Earnings per share: Basic $ 2.32 $ 2.12 $ 2.27 Diluted $ 2.26 $ 2.04 $ 2.19 |
FINANCIAL INFORMATION BY INDU47
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE [Abstract] | |
Revenue and Net Property, Plant and Equipment by Customer Location | We operate predominantly in one industry segment – the development, manufacture, and sale of CMP consumables. Revenues are attributed to the United States and foreign regions based upon the customer location and not the geographic location from which our products were shipped. Financial information by geographic area was as follows: Year Ended September 30, 2015 2014 2013 Revenue: United States $ 55,989 $ 51,036 $ 53,955 Asia 328,669 347,669 347,797 Europe 29,439 25,961 31,379 Total $ 414,097 $ 424,666 $ 433,131 Property, plant and equipment, net: United States $ 43,239 $ 44,585 $ 47,436 Asia 50,504 56,236 64,546 Europe - - 3 Total $ 93,743 $ 100,821 $ 111,985 |
Revenue by Country Greater than Ten Percent of Total Revenue | The following table shows revenue from sales to customers in foreign countries that accounted for more than ten percent of our total revenue in fiscal 2015, 2014 and 2013: Year Ended September 30, 2015 2014 2013 Revenue: Taiwan $ 124,460 $ 138,049 $ 133,273 South Korea 70,608 71,420 73,778 China 49,350 45,200 * * Denotes less than ten percent of total |
Net Property, Plant and Equipment in Foreign Countries Greater than Ten Percent of Total Net Property, Plant and Equipment | The following table shows net property, plant and equipment in foreign countries that accounted for more than ten percent of our total net property, plant and equipment in fiscal 2015, 2014 and 2013: Year Ended September 30, 2015 2014 2013 Property, plant and equipment, net: Japan $ 22,572 $ 27,110 $ 33,566 Taiwan 17,419 16,675 17,212 South Korea 9,658 11,564 12,591 |
Schedule of Revenue by Product Line | The following table shows revenue generated by product area in fiscal 2015, 2014 and 2013: Year Ended September 30, 2015 2014 2013 Revenue: Tungsten slurries $ 178,770 $ 162,148 $ 155,904 Dielectric slurries 96,386 118,079 123,180 Other Metals slurries 71,640 76,605 76,367 Polishing pads 32,048 33,824 32,996 Engineered Surface Finishes 21,534 16,160 23,999 Data storage slurries 13,719 17,850 20,685 Total $ 414,097 $ 424,666 $ 433,131 |
SELECTED QUARTERLY OPERATING 48
SELECTED QUARTERLY OPERATING RESULTS (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
SELECTED QUARTERLY OPERATING RESULTS [Abstract] | |
Selected Quarterly Operating Results | The following table presents our unaudited financial information for the eight quarterly periods ended September 30, 2015. This unaudited financial information has been prepared in accordance with accounting principles generally accepted in the United States of America, applied on a basis consistent with the annual audited financial statements and in the opinion of management, include all necessary adjustments, which consist only of normal recurring adjustments necessary to present fairly the financial results for the periods. The results for any quarter are not necessarily indicative of results for any future period. CABOT MICROELECTRONICS CORPORATION SELECTED QUARTERLY OPERATING RESULTS (Unaudited and in thousands, except per share amounts) Sept. 30, 2015 June 30, 2015 March 31, 2015 Dec. 31, 2014 Sept. 30, 2014 June 30, 2014 March 31, 2014 Dec. 31, 2013 Revenue $ 100,137 $ 97,168 $ 104,858 $ 111,934 $ 116,337 $ 108,358 $ 99,456 $ 100,515 Cost of goods sold 48,115 48,609 50,182 54,960 59,209 56,632 52,931 52,801 Gross profit 52,022 48,559 54,676 56,974 57,128 51,726 46,525 47,714 Operating expenses: Research, development and technical 14,856 14,773 15,131 15,018 15,051 15,368 14,364 14,571 Selling and marketing 5,763 5,804 5,777 7,639 6,846 6,489 6,471 6,707 General and administrative 13,553 12,830 14,296 11,751 12,236 11,380 11,076 10,726 Total operating expenses 34,172 33,407 35,204 34,408 34,133 33,237 31,911 32,004 Operating income 17,850 15,152 19,472 22,566 22,995 18,489 14,614 15,710 Interest expense 1,494 1,065 1,059 906 807 832 843 872 Other income (expense), net 116 (160 ) (332 ) 1,057 (448 ) (132 ) 103 617 Income before income taxes 16,472 13,927 18,081 22,717 21,740 17,525 13,874 15,455 Provision for income taxes 3,939 4,041 4,270 2,801 5,694 4,223 3,779 4,147 Net income $ 12,533 $ 9,886 $ 13,811 $ 19,916 $ 16,046 $ 13,302 $ 10,095 $ 11,308 Basic earnings per share $ 0.51 $ 0.40 $ 0.57 $ 0.83 $ 0.67 $ 0.55 $ 0.42 $ 0.47 Weighted average basic shares outstanding 24,144 24,333 24,057 23,651 23,500 23,753 23,982 23,590 Diluted earnings per share $ 0.50 $ 0.39 $ 0.55 $ 0.80 $ 0.65 $ 0.53 $ 0.40 $ 0.45 Weighted average diluted shares outstandin 24,583 24,813 24,693 24,486 24,334 24,613 24,897 24,623 |
SUMMARY OF SIGNIFICANT ACCOUN49
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015USD ($)Segmentmm | Sep. 30, 2014USD ($) | Sep. 30, 2013USD ($) | |
ACCOUNTS RECEIVABLE [Abstract] | |||
Accounts receivable, less allowance for doubtful accounts | $ 49,405 | $ 60,693 | |
Allowance for doubtful accounts [Roll Forward] | |||
Balance, beginning of period | 1,392 | ||
Amounts charged to expense | (84) | (170) | $ 173 |
Deductions and adjustments | (84) | ||
Balance, end of period | $ 1,224 | $ 1,392 | |
Minimum reporting requirements for customer concentration disclosure (in hundredths) | 10.00% | 10.00% | 10.00% |
Goodwill and Intangible Assets [Abstract] | |||
Total number of reporting units | Segment | 4 | ||
Number of reporting units to which goodwill and intangible assets have been allocated | Segment | 3 | ||
Intercompany Loan Accounting [Abstract] | |||
Size of polishing tool (in millimeters) | mm | 300 | ||
Minimum [Member] | |||
Goodwill and Intangible Assets [Abstract] | |||
Finite-Lived Intangible Asset, Useful Life | 1 year | ||
Maximum [Member] | |||
Goodwill and Intangible Assets [Abstract] | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||
Buildings [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 15 years | ||
Buildings [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 25 years | ||
Machinery and Equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Machinery and Equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 10 years | ||
Furniture and fixtures [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 5 years | ||
Furniture and fixtures [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 10 years | ||
Information Systems [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Information Systems [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Useful Life | 5 years | ||
Accounts Receivable [Member] | Taiwan Semiconductor Manufacturing Co. (TSMC) [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of net accounts receivable concentration (in hundredths) | 12.60% | 19.40% | |
Accounts Receivable [Member] | Samsung Group (Samsung) [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of net accounts receivable concentration (in hundredths) | 9.70% | 10.20% | |
Revenue [Member] | Taiwan Semiconductor Manufacturing Co. (TSMC) [Member] | |||
Concentration Risk [Line Items] | |||
Concentration of credit risk by customer (in hundredths) | 18.00% | 22.00% | 21.00% |
Revenue [Member] | Samsung Group (Samsung) [Member] | |||
Concentration Risk [Line Items] | |||
Concentration of credit risk by customer (in hundredths) | 15.00% | 14.00% | 13.00% |
FAIR VALUE OF FINANCIAL INSTR50
FAIR VALUE OF FINANCIAL INSTRUMENTS, Schedule of Fair Value of Financial Instruments (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Assets, Fair Value Disclosure [Abstract] | ||
Cash and cash equivalents | $ 354,190 | $ 284,155 |
Other long-term investments | 1,720 | 1,654 |
Derivative financial instruments | 14 | 100 |
Total Assets | 355,924 | 285,909 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Derivative financial instruments | 1,406 | 270 |
Total liabilities | 1,406 | 270 |
Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash and cash equivalents | 354,190 | 284,155 |
Other long-term investments | 1,720 | 1,654 |
Derivative financial instruments | 0 | 0 |
Total Assets | 355,910 | 285,809 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Derivative financial instruments | 0 | 0 |
Total liabilities | 0 | 0 |
Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash and cash equivalents | 0 | 0 |
Other long-term investments | 0 | 0 |
Derivative financial instruments | 14 | 100 |
Total Assets | 14 | 100 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Derivative financial instruments | 1,406 | 270 |
Total liabilities | 1,406 | 270 |
Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash and cash equivalents | 0 | 0 |
Other long-term investments | 0 | 0 |
Derivative financial instruments | 0 | 0 |
Total Assets | 0 | 0 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Derivative financial instruments | 0 | 0 |
Total liabilities | $ 0 | $ 0 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
INVENTORIES [Abstract] | ||
Raw materials | $ 42,603 | $ 37,009 |
Work in process | 5,487 | 4,505 |
Finished goods | 22,588 | 23,465 |
Total | $ 70,678 | $ 64,979 |
PROPERTY, PLANT AND EQUIPMENT52
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | $ 319,497 | $ 323,871 | |
Less: accumulated depreciation and amortization of assets under capital leases | (225,754) | (223,050) | |
Net property, plant and equipment | 93,743 | 100,821 | $ 111,985 |
Depreciation expense, including amortization of assets recorded under capital leases | 16,060 | 17,467 | 17,835 |
Impairment expense | 0 | 2,320 | 0 |
Impairment expense, cost of goods sold | 0 | 2,236 | 0 |
Impairment expense, selling and marketing | 0 | 84 | $ 0 |
Land [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | 17,076 | 17,834 | |
Buildings [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | 92,720 | 97,513 | |
Machinery and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | 167,448 | 171,461 | |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | 6,172 | 6,224 | |
Information Systems [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | 28,528 | 27,673 | |
Construction in Progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | $ 7,553 | $ 3,166 |
GOODWILL AND OTHER INTANGIBLE53
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | ||
GOODWILL AND OTHER INTANGIBLE ASSETS [Abstract] | ||||
Goodwill | $ 40,442 | $ 43,245 | ||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross Carrying Amount subject to amortization | 30,265 | 31,291 | ||
Accumulated Amortization | 26,890 | 25,318 | ||
Total other intangible assets not subject to amortization | [1] | 1,190 | 1,190 | |
Total other intangible assets | 31,455 | 32,481 | ||
Other intangible assets [Abstract] | ||||
Amortization expense | 2,346 | 2,474 | $ 2,622 | |
Estimated future amortization expense [Abstract] | ||||
2,016 | 1,875 | |||
2,017 | 1,064 | |||
2,018 | 419 | |||
2,019 | 11 | |||
2,020 | 6 | |||
Product Technology [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross Carrying Amount subject to amortization | 8,053 | 8,278 | ||
Accumulated Amortization | 7,490 | 6,750 | ||
Acquired Patents and Licenses [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross Carrying Amount subject to amortization | 8,270 | 8,270 | ||
Accumulated Amortization | 7,845 | 7,534 | ||
Trade Secrets and Know How [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross Carrying Amount subject to amortization | 2,550 | 2,550 | ||
Accumulated Amortization | 2,550 | 2,550 | ||
Customer relationships, distribution rights and Other [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross Carrying Amount subject to amortization | 11,392 | 12,193 | ||
Accumulated Amortization | $ 9,005 | $ 8,484 | ||
[1] | Total other intangible assets not subject to amortization primarily consist of trade names. |
OTHER LONG-TERM ASSETS (Details
OTHER LONG-TERM ASSETS (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013USD ($) | Sep. 30, 2015USD ($)Security | Sep. 30, 2014USD ($) | |
OTHER LONG-TERM ASSETS [Abstract] | ||||
Auction rate securities (ARS) | $ 5,694 | $ 5,895 | ||
Other long-term assets | 3,595 | 3,043 | ||
Long-term contract asset | 3,995 | 0 | ||
Other long-term investments | 1,720 | 1,654 | ||
Total | $ 15,004 | $ 10,592 | ||
Number of auction rate securities | Security | 2 | |||
Minimum maturity period of auction rate securities (ARS) | 10 years | |||
Fair value of auction rate securities | $ 5,182 | |||
Gross unrecognized loss of ARS | 512 | |||
Percentage of par value received from auction rate security settlement (in hundredths) | 65.00% | |||
Monetization of Auction Rate Securities | $ 2,113 | |||
Reversal of temporary impairment | $ 234 | |||
Long-term liability, SERP investments | 1,720 | |||
Long-term contract asset face amount | $ 4,500 |
ACCRUED EXPENSES, INCOME TAXE55
ACCRUED EXPENSES, INCOME TAXES PAYABLE AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
ACCRUED EXPENSES, INCOME TAXES PAYABLE AND OTHER CURRENT LIABILITIES [Abstract] | ||
Accrued compensation | $ 23,793 | $ 16,980 |
Goods and services received, not yet invoiced | 1,830 | 3,167 |
Deferred revenue and customer advances | 538 | 1,223 |
Warranty accrual | 209 | 246 |
Income taxes payable | 4,276 | 5,448 |
Taxes, other than income taxes | 975 | 1,182 |
Other | 4,825 | 3,148 |
Total | $ 36,446 | $ 31,394 |
DEBT (Details)
DEBT (Details) - USD ($) $ in Thousands | Jun. 27, 2014 | Jun. 26, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Feb. 13, 2012 |
Debt Instrument [Line Items] | |||||||
Total outstanding commitments | $ 164,063 | ||||||
Debt issuance costs | 0 | $ 550 | $ 0 | $ 2,658 | |||
Debt issuance costs, current | 410 | ||||||
Debt issuance costs, noncurrent | $ 1,075 | ||||||
Weighted average fixed rate (in hundredths) | 1.50% | ||||||
Conversion Percentage of Variable Rate Debt into Fixed Debt Rate | 50.00% | ||||||
Current portion of long-term debt | $ 8,750 | $ 8,750 | |||||
Line of credit facility, covenant terms | The Credit Agreement contains covenants that restrict the ability of the Company and its subsidiaries to take certain actions, including, among other things and subject to certain significant exceptions: creating liens, incurring indebtedness, making investments, engaging in mergers, selling property, paying dividends or amending organizational documents. The Credit Agreement requires us to comply with certain financial ratio maintenance covenants. These include a maximum consolidated leverage ratio of 3.00 to 1.00 through December 31, 2015 and a minimum consolidated fixed charge coverage ratio of 1.25 to 1.00. The maximum consolidated leverage ratio will decrease to 2.75 to 1.00 from January 1, 2016 through the termination of the Credit Agreement. As of September 30, 2015, our consolidated leverage ratio was 1.52 to 1.00 and our consolidated fixed charge coverage ratio was 5.54 to 1.00. The Credit Agreement also contains customary affirmative covenants and events of default. We believe we are in compliance with these covenants. | ||||||
Consolidated leverage ratio through December 31, 2015 | 3 | ||||||
Consolidated fixed charge coverage ratio | 1.25 | ||||||
Consolidated leverage ratio after January 1, 2016 | 2.75 | ||||||
Actual consolidated leverage ratio | 1.52 | ||||||
Actual consolidated fixed charge coverage | 5.54 | ||||||
Long-term Debt, by Maturity [Abstract] | |||||||
2,016 | $ 8,750 | ||||||
2,017 | 7,656 | ||||||
2,018 | 14,219 | ||||||
2,019 | 133,438 | ||||||
Long Term Debt | $ 164,063 | ||||||
Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, borrowing capacity | $ 200,000 | $ 175,000 | $ 175,000 | ||||
Debt instrument, maturity date | Jun. 27, 2019 | Feb. 13, 2017 | |||||
Line of credit facility, interest rate description | In addition to paying interest on outstanding principal under the Credit Agreement, we pay a commitment fee to the lenders under the Revolving Credit Facility in respect of the unutilized commitments thereunder. As amended, the fee ranges from 0.20% to 0.30%, based on our consolidated leverage ratio. | ||||||
Line of credit facility unused capacity commitment fee percentage, minimum (in hundredths) | 0.20% | ||||||
Line of credit facility unused capacity commitment fee percentage, maximum (in hundredths) | 0.30% | ||||||
Term Loan [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 175,000 | $ 157,500 | $ 175,000 | ||||
Increase in loan commitments | 17,500 | ||||||
Amount drawn from increase in loan commitments | 17,500 | ||||||
Total outstanding commitments | 175,000 | ||||||
Line of credit facility, interest rate description | Borrowings under the amended Credit Facilities (other than in respect of swing-line loans) bear interest at a rate per annum equal to the “Applicable Rate” (as defined below) plus, at our option, either (1) a LIBOR rate determined by reference to the cost of funds for deposits in the relevant currency for the interest period relevant to such borrowing or (2) the “Base Rate”, which is the highest of (x) the prime rate of Bank of America, N.A., (y) the federal funds rate plus 1/2 of 1.00% and (z) the one-month LIBOR rate plus 1.00%. The current Applicable Rate for borrowings under the Credit Facilities is 1.50%, as amended, with respect to LIBOR borrowings and 0.25% with respect to Base Rate borrowings, with such Applicable Rate subject to adjustment based on our consolidated leverage ratio. Swing-line loans bear interest at the Base Rate plus the Applicable Rate for Base Rate loans under the Revolving Credit Facility. | ||||||
Current portion of long-term debt | $ 8,750 | ||||||
Long-term Debt, by Maturity [Abstract] | |||||||
Long Term Debt | $ 175,000 |
DERIVATIVE FINANCIAL INSTRUME57
DERIVATIVE FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | |
Derivative [Line Items] | |||
Unrealized loss | $ 901 | ||
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimated Net Amount to be Transferred | $ 901 | ||
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimate of Time to Transfer | 12 months | ||
Foreign Exchange Contract [Member] | Buy [Member] | |||
Derivative [Line Items] | |||
Derivative, Notional Amount | $ 1,034 | $ 4,695 | |
Foreign Exchange Contract [Member] | Sell [Member] | |||
Derivative [Line Items] | |||
Derivative, Notional Amount | 18,690 | $ 18,425 | |
Interest Rate Swap [Member] | |||
Derivative [Line Items] | |||
Outstanding variable rate debt | $ 86,406 | ||
Interest Rate Swap [Member] | Buy [Member] | |||
Derivative [Line Items] | |||
Derivative, Notional Amount | $ 82,031 |
DERIVATIVE FINANCIAL INSTRUME58
DERIVATIVE FINANCIAL INSTRUMENTS, Schedule of Fair Value of Derivative Instruments in the Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Foreign Exchange Contract [Member] | Prepaid Expenses and Other Current Assets [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of foreign exchange contract asset derivatives | $ 14 | $ 100 |
Fair value of foreign exchange contract liability derivatives | 0 | 0 |
Foreign Exchange Contract [Member] | Accrued Expenses and Other Current Liabilities [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of foreign exchange contract asset derivatives | 0 | 0 |
Fair value of foreign exchange contract liability derivatives | 8 | 270 |
Interest Rate Swap [Member] | Accrued Expenses and Other Current Liabilities [Member] | Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of foreign exchange contract asset derivatives | 0 | 0 |
Fair value of foreign exchange contract liability derivatives | 885 | 0 |
Interest Rate Swap [Member] | Other Noncurrent Assets [Member] | Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of foreign exchange contract asset derivatives | 0 | 0 |
Fair value of foreign exchange contract liability derivatives | 0 | 0 |
Interest Rate Swap [Member] | Other Long-term Liabilities [Member] | Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of foreign exchange contract asset derivatives | 0 | 0 |
Fair value of foreign exchange contract liability derivatives | $ 513 | $ 0 |
DERIVATIVE FINANCIAL INSTRUME59
DERIVATIVE FINANCIAL INSTRUMENTS, Schedule of the Effect of Derivative Instruments on the Consolidated Statement of Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Foreign Exchange Contract [Member] | Other Income (Expense), Net [Member] | Not Designated as Hedging Instrument [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) recognized in statement of income | $ (1,674) | $ (1,289) | $ 252 |
ACCUMULATED OTHER COMPREHENSI60
ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | $ 9,255 | $ 17,436 | $ 30,466 |
Foreign currency translation adjustment | (14,126) | (8,136) | (13,037) |
Net unrealized gain on marketable securities | 0 | 151 | 0 |
Change in fair value, net of tax | (1,511) | ||
Reclassifications adjustment into earnings, net of tax | 610 | ||
Change in pension and other posteretirement, net of tax | 318 | 196 | (7) |
Ending Balance | (6,090) | 9,255 | 17,436 |
Foreign currency translation adjustment, tax | (1,731) | (1,597) | (3,187) |
Change in pension and other postretirement, tax | 0 | 0 | 0 |
Change in fair value, tax | (833) | ||
Reclassification adjustment into earnings, tax | 336 | ||
Foreign Currency Translation Adjustment [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | 10,115 | 18,251 | 31,288 |
Foreign currency translation adjustment | (14,126) | (8,136) | (13,037) |
Net unrealized gain on marketable securities | 0 | ||
Change in fair value, net of tax | 0 | ||
Reclassifications adjustment into earnings, net of tax | 0 | ||
Change in pension and other posteretirement, net of tax | 0 | 0 | 0 |
Ending Balance | (4,011) | 10,115 | 18,251 |
Unrealized Gain (Loss) on Cash Flow Hedges [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | 0 | 0 | 0 |
Foreign currency translation adjustment | 0 | 0 | 0 |
Net unrealized gain on marketable securities | 0 | ||
Change in fair value, net of tax | (1,511) | ||
Reclassifications adjustment into earnings, net of tax | 610 | ||
Change in pension and other posteretirement, net of tax | 0 | 0 | 0 |
Ending Balance | (901) | 0 | 0 |
Pension and Other Postretirement Liabilities [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | (860) | (664) | (671) |
Foreign currency translation adjustment | 0 | 0 | |
Net unrealized gain on marketable securities | 0 | ||
Change in fair value, net of tax | 0 | ||
Reclassifications adjustment into earnings, net of tax | 0 | ||
Change in pension and other posteretirement, net of tax | (318) | (196) | 7 |
Ending Balance | (1,178) | (860) | (664) |
Unrealized Gain (Loss) on Marketable Securities [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | 0 | (151) | (151) |
Foreign currency translation adjustment | 0 | 0 | 0 |
Net unrealized gain on marketable securities | 151 | ||
Change in fair value, net of tax | 0 | ||
Reclassifications adjustment into earnings, net of tax | 0 | ||
Change in pension and other posteretirement, net of tax | 0 | 0 | 0 |
Ending Balance | $ 0 | $ 0 | $ (151) |
SHARE-BASED COMPENSATION PLAN61
SHARE-BASED COMPENSATION PLANS (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||
Mar. 31, 2015USD ($) | Sep. 30, 2015USD ($)Awards$ / sharesshares | Sep. 30, 2014USD ($)$ / sharesshares | Sep. 30, 2013USD ($)$ / sharesshares | Dec. 31, 2014USD ($) | Mar. 31, 2014Employee | Mar. 31, 2008shares | Feb. 29, 2008shares | |
Omnibus Incentive Plan [Abstract] | ||||||||
Number of equity incentive awards | Awards | 6 | |||||||
Number of shares authorized for issuance (in shares) | shares | 4,934,444 | |||||||
Number of shares authorized under newly issued plan (in shares) | shares | 2,901,360 | |||||||
Number of shares available under previously existing plan (in shares) | shares | 2,033,084 | |||||||
Share based compensation expense | $ 16,445 | $ 14,042 | $ 13,350 | |||||
Employee stock purchase plan [Abstract] | ||||||||
Number of shares issued, employee stock ownership plan (in shares) | shares | 65,735 | 81,700 | 84,602 | |||||
Stock Options Activity [Roll Forward] | ||||||||
Exercised (in shares) | shares | (1,324,646) | (1,449,002) | (1,071,750) | |||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||||||
Stock based compensation - tax benefit | $ (5,511) | $ (4,722) | $ (4,581) | |||||
Total share-based compensation expense, net of tax | $ 10,934 | 9,320 | 8,769 | |||||
Additional Share Based Compensation Expense | $ 378 | |||||||
Fair Value of Unvested Equity | $ 5,033 | |||||||
Deposit Share Plan [Member] | ||||||||
Omnibus Incentive Plan [Abstract] | ||||||||
Stock based compensation, vesting period | 3 years | |||||||
Deposit share plan match in restricted shares (in hundredths) | 50.00% | |||||||
Employee Stock Purchase Plan [Member] | ||||||||
Omnibus Incentive Plan [Abstract] | ||||||||
Number of shares authorized for issuance (in shares) | shares | 582,588 | 975,000 | 475,000 | |||||
Share based compensation expense | $ 686 | $ 680 | $ 584 | |||||
Employee stock purchase plan [Abstract] | ||||||||
Percentage annual earnings withheld to purchase stock, maximum (in hundredths) | 10.00% | |||||||
Maximum discounted stock purchase price (in hundredths) | 85.00% | |||||||
Number of shares issued, employee stock ownership plan (in shares) | shares | 65,735 | 81,700 | 84,602 | |||||
Share based compensation arrangements, Fair value assumptions and methodology [Abstract] | ||||||||
Weighted-average grant date fair value - ESPP (in dollars per share) | $ / shares | $ 10.17 | $ 9.11 | $ 7.41 | |||||
Expected term (in years) | 6 months | 6 months | 6 months | |||||
Expected volatility (in hundredths) | 24.00% | 25.00% | 25.00% | |||||
Risk-free rate of return (in hundredths) | 0.10% | 0.10% | 0.10% | |||||
Dividend yield (in hundredths) | 0.00% | 0.00% | 0.00% | |||||
Directors' Deferred Compensation Plan [Member] | ||||||||
Omnibus Incentive Plan [Abstract] | ||||||||
Share based compensation expense | $ 95 | $ 95 | $ 95 | |||||
Directors' Deferred Compensation Plan [Member] | ||||||||
Directors' deferred compensation plan [Abstract] | ||||||||
Cumulative number of shares deferred (in shares) | shares | 63,979 | 76,633 | ||||||
Cost of Goods Sold [Member] | ||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||||||
Stock based compensation expense | $ 1,912 | $ 1,866 | 1,707 | |||||
Research, Development and technical [Member] | ||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||||||
Stock based compensation expense | 1,596 | 1,475 | 1,301 | |||||
Selling and Marketing [Member] | ||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||||||
Stock based compensation expense | 1,075 | 1,298 | 1,367 | |||||
General and Administrative [Member] | ||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||||||
Stock based compensation expense | $ 11,862 | 9,403 | 8,975 | |||||
Director [Member] | ||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||||||
Number of non-employee directors who have completed two full terms of service | Employee | 6 | |||||||
Fair value of awards for completing minimum full terms of service | $ 1,308 | |||||||
Vesting period | 1 year | |||||||
Stock Options [Member] | ||||||||
Omnibus Incentive Plan [Abstract] | ||||||||
Stock based compensation, contractual term | 10 years | |||||||
Stock based compensation, vesting period | 4 years | |||||||
Amount vested in first year for non employee directors (in hundredths) | 100.00% | |||||||
Share based compensation expense | $ 7,173 | $ 6,947 | $ 6,878 | |||||
Share based compensation arrangements, Fair value assumptions and methodology [Abstract] | ||||||||
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 16.99 | $ 15.78 | $ 12.13 | |||||
Expected term (in years) | 6 years 3 months 18 days | 6 years 4 months 24 days | 6 years 4 months 13 days | |||||
Expected volatility (in hundredths) | 33.00% | 32.00% | 36.00% | |||||
Risk-free rate of return (in hundredths) | 1.90% | 1.90% | 0.90% | |||||
Dividend yield (in hundredths) | 0.00% | 0.00% | 0.00% | |||||
Stock Options Activity [Roll Forward] | ||||||||
Outstanding, beginning of period (in shares) | shares | 3,272,898 | |||||||
Granted (in shares) | shares | 397,528 | |||||||
Exercised (in shares) | shares | (1,324,646) | |||||||
Forfeited or canceled (in shares) | shares | (185,987) | |||||||
Outstanding, end of period (in shares) | shares | 2,159,793 | 3,272,898 | ||||||
Exercisable, end of period ( in shares) | shares | 1,256,818 | |||||||
Expected to vest, end of period (in shares) | shares | 901,535 | |||||||
Weighted Average Exercise Price [Roll Forward] | ||||||||
Weighted average exercise price, outstanding, beginning of period (in dollars per share) | $ / shares | $ 29.04 | |||||||
Weighted average exercise price, granted (in dollars per share) | $ / shares | 47 | |||||||
Weighted average exercise price, exercised (in dollars per share) | $ / shares | 25.05 | |||||||
Weighted average exercise price, forfeited or canceled (in dollars per share) | $ / shares | 39.41 | |||||||
Weighted average exercise price, outstanding, end of period (in dollars per share) | $ / shares | 33.90 | $ 29.04 | ||||||
Weighted average exercise price, exercisable, end of period (in dollars per share) | $ / shares | 28.95 | |||||||
Weighted average exercise price, expected to vest, end of period (in dollars per share) | $ / shares | $ 40.77 | |||||||
Additional Disclosures [Abstract] | ||||||||
Weighted average remaining contractual term, outstanding, end of period (in years) | 6 years 6 months | |||||||
Weighted average remaining contractual term, exercisable, end of period (in years) | 5 years 4 months 24 days | |||||||
Weighted average remaining contractual term, expected to vest, end of period (in years) | 8 years 1 month 6 days | |||||||
Aggregate intrinsic value, outstanding, end of period | $ 15,376 | |||||||
Aggregate intrinsic value, exercisable, end of period | 12,995 | |||||||
Aggregate intrinsic value, expected to vest, end of period | $ 2,381 | |||||||
Closing stock price (in dollars per share) | $ / shares | $ 38.74 | |||||||
Total intrinsic value of options exercised | $ 31,546 | $ 21,647 | $ 9,847 | |||||
Cash received from options exercised | 33,177 | 40,248 | 28,525 | |||||
Actual tax benefit realized for the tax deductions from options exercised | 10,569 | 7,611 | 3,394 | |||||
Total fair value of stock options vested | 7,005 | 6,645 | 6,681 | |||||
Total unrecognized share-based compensation expense | $ 9,566 | |||||||
Compensation cost, weighted-average period for recognition (in years) | 2 years 3 months 18 days | |||||||
Restricted Stock [Member] | ||||||||
Omnibus Incentive Plan [Abstract] | ||||||||
Stock based compensation, vesting period | 4 years | |||||||
Amount vested in first year for non employee directors (in hundredths) | 100.00% | |||||||
Share based compensation expense | $ 8,491 | $ 6,320 | 5,793 | |||||
Additional Disclosures [Abstract] | ||||||||
Total unrecognized share-based compensation expense | $ 11,094 | |||||||
Compensation cost, weighted-average period for recognition (in years) | 2 years 4 months 24 days | |||||||
Restricted stock and restricted stock awards units [Roll Forward] | ||||||||
Restricted stocks awards and units, nonvested, beginning of period (in shares) | shares | 398,099 | |||||||
Restricted stocks awards and units, granted (in shares) | shares | 228,492 | |||||||
Restricted stocks awards and units, vested (in shares) | shares | (180,417) | |||||||
Restricted stocks awards and units, forfeited (in shares) | shares | (63,678) | |||||||
Restricted stocks awards and units, nonvested, end of period (in shares) | shares | 382,496 | 398,099 | ||||||
Weighted Average Grant Date Fair Value [Roll Forward] | ||||||||
Weighted average grant date fair value, nonvested, beginning of period (in dollars per share) | $ / shares | $ 39.11 | |||||||
Weighted average grant date fair value, granted (in dollars per share) | $ / shares | 47.13 | |||||||
Weighted average grant date fair value, vested (in dollars per share) | $ / shares | 40.03 | |||||||
Weighted average grant date fair value, forfeited (in dollars per share) | $ / shares | 41.63 | |||||||
Weighted average grant date fair value, nonvested, end of period (in dollars per share) | $ / shares | $ 43.05 | $ 39.11 | ||||||
Total fair values of restricted stock awards and restricted stock units vested | $ 7,222 | $ 5,916 | $ 5,457 | |||||
Other than Options or SARs [Member] | ||||||||
Omnibus Incentive Plan [Abstract] | ||||||||
Number of shares authorized other than options or SARS (in shares) | shares | 2,030,952 | |||||||
Incentive Stock Options [Member] | ||||||||
Omnibus Incentive Plan [Abstract] | ||||||||
Number of shares authorized for incentive stock options (in shares) | shares | 2,538,690 |
SAVINGS PLAN (Details)
SAVINGS PLAN (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
SAVINGS PLAN [Abstract] | |||
Maximum participants' contributions as a percentage of their eligible compensation (in hundredths) | 60.00% | ||
Company's matching contribution on participants' first four percent contribution (in hundredths) | 100.00% | ||
Company's matching contribution on participants' contributions over two percent (in hundredths) | 50.00% | ||
Percentage of participant's contribution subject to company's one hundred percent matching contribution (in hundredths) | 4.00% | ||
Percentage of participant's contribution subject to company's fifty percent matching contribution | 2.00% | ||
401(k) Plan expense | $ 4,111 | $ 4,547 | $ 4,057 |
Percentage of company's contribution vested at the time of contribution (in hundredths) | 100.00% |
OTHER INCOME (EXPENSE), NET (De
OTHER INCOME (EXPENSE), NET (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Other Income (Expense) Net [Line Items] | |||||||||||
Total other income, net | $ 116 | $ (160) | $ (332) | $ 1,057 | $ (448) | $ (132) | $ 103 | $ 617 | $ 681 | $ 140 | $ 1,392 |
Interest Income [Member] | |||||||||||
Other Income (Expense) Net [Line Items] | |||||||||||
Total other income, net | 365 | 194 | 145 | ||||||||
Other Income (Expense) [Member] | |||||||||||
Other Income (Expense) Net [Line Items] | |||||||||||
Total other income, net | $ 316 | $ (54) | $ 1,247 |
STOCKHOLDERS EQUITY (Details)
STOCKHOLDERS EQUITY (Details) $ in Thousands | 12 Months Ended | |||
Sep. 30, 2015USD ($)Voteshares | Sep. 30, 2014USD ($)shares | Sep. 30, 2013USD ($)shares | Apr. 30, 2014USD ($) | |
Capital Stock Activity [Rollforward] | ||||
Beginning Balance (in shares) | 31,927,601 | 30,213,577 | 28,864,527 | |
Exercise of stock options (in shares) | 1,324,646 | 1,449,002 | 1,071,750 | |
Restricted stock under EIP, net of forfeitures (in shares) | 172,010 | 176,026 | 185,925 | |
Restricted stock under Deposit Share Plan, net of forfeitures | (811) | 7,296 | 6,773 | |
Common stock under ESPP (in shares) | 65,735 | 81,700 | 84,602 | |
Ending Balance (in shares) | 33,489,181 | 31,927,601 | 30,213,577 | |
Treasury Stock [Abstract] | ||||
Beginning Balance (in shares) | 8,142,687 | 6,866,675 | 5,682,288 | |
Repurchases of common stock under share repurchase plans (in shares) | 851,245 | 1,229,494 | 1,144,836 | |
Repurchases of common stock - other (in shares) | 47,746 | 46,518 | 39,551 | |
Ending Balance (in shares) | 9,041,678 | 8,142,687 | 6,866,675 | |
Number of votes each common stockholder is entitled to on matter submitted to a vote of stockholders | Vote | 1 | |||
Number of authorized shares of common stock (in shares) | 200,000,000 | 200,000,000 | ||
Share repurchase program, value of shares remaining to be repurchased | $ | $ 84,975 | |||
Cost of shares repurchased | $ | 40,026 | $ 53,000 | $ 40,000 | |
Current Repurchase Program [Member] | ||||
Treasury Stock [Abstract] | ||||
Share repurchase program, value of shares authorized to be repurchased | $ | $ 150,000 | |||
Prior Repurchase Program [Member] | ||||
Treasury Stock [Abstract] | ||||
Share repurchase program, value of shares authorized to be repurchased | $ | $ 62,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Income (loss) from continuing operations before income taxes [Abstract] | |||||||||||
Domestic | $ 15,305 | $ 14,358 | $ 40,045 | ||||||||
Foreign | 55,892 | 54,236 | 34,175 | ||||||||
Income before income taxes | $ 16,472 | $ 13,927 | $ 18,081 | $ 22,717 | $ 21,740 | $ 17,525 | $ 13,874 | $ 15,455 | 71,197 | 68,594 | 74,220 |
U.S. federal and state [Abstract] | |||||||||||
Current | 6,496 | 8,978 | 18,060 | ||||||||
Deferred | 1,791 | 488 | (3,494) | ||||||||
Total | 8,287 | 9,466 | 14,566 | ||||||||
Foreign [Abstract] | |||||||||||
Current | 7,686 | 9,565 | 8,304 | ||||||||
Deferred | (922) | (1,188) | (1,228) | ||||||||
Total | 6,764 | 8,377 | 7,076 | ||||||||
Total U.S. and foreign | 3,939 | $ 4,041 | $ 4,270 | 2,801 | 5,694 | $ 4,223 | $ 3,779 | 4,147 | $ 15,051 | $ 17,843 | $ 21,642 |
Effective income tax rate reconciliation [Abstract] | |||||||||||
Federal statutory rate (in hundredths) | 35.00% | 35.00% | 35.00% | ||||||||
U.S. benefits from research and experimentation activities (in hundredths) | (2.20%) | (0.60%) | (2.00%) | ||||||||
State taxes, net of federal effect (in hundredths) | 0.60% | 0.80% | 0.30% | ||||||||
Foreign income at other than U.S. rates (in hundredths) | (21.40%) | (9.40%) | (5.30%) | ||||||||
Change in valuation allowance (in hundredths) | 0.00% | 0.00% | 1.40% | ||||||||
Executive compensation (in hundredths) | 0.60% | 0.40% | 0.20% | ||||||||
Share-based compensation (in hundredths) | 0.10% | 0.10% | 0.50% | ||||||||
Adjustment of prior amounts (in hundredths) | 1.40% | 0.10% | 0.10% | ||||||||
Taiwan Restructuring | 7.20% | 0.00% | 0.00% | ||||||||
Domestic production deduction (in hundredths) | (1.30%) | (0.30%) | (0.20%) | ||||||||
Other, net (in hundredths) | 1.10% | (0.10%) | (0.80%) | ||||||||
Provision for income taxes (in hundredths) | 21.10% | 26.00% | 29.20% | ||||||||
Undistributed earnings of foreign subsidiaries | 122,625 | $ 122,625 | |||||||||
Reconciliation of gross unrecognized tax benefits [Roll Forward] | |||||||||||
Beginning balance | $ 701 | $ 758 | 701 | $ 758 | $ 283 | ||||||
Additions for tax positions relating to the current fiscal year | 194 | 59 | 228 | ||||||||
Additions for tax positions relating to prior fiscal years | 1,400 | 125 | 247 | ||||||||
Settlements with taxing authorities | (522) | (207) | 0 | ||||||||
Lapse of statute of limitations | 0 | (34) | 0 | ||||||||
Ending balance | 1,773 | 701 | 1,773 | 701 | 758 | ||||||
Accrued interest and penalties on uncertain tax positions | 47 | 42 | 47 | 42 | |||||||
Deferred tax assets [Abstract] | |||||||||||
Employee benefits | 4,061 | 3,889 | 4,061 | 3,889 | |||||||
Inventory | 3,271 | 3,385 | 3,271 | 3,385 | |||||||
Bad debt reserve | 391 | 515 | 391 | 515 | |||||||
Share-based compensation expense | 9,863 | 12,150 | 9,863 | 12,150 | |||||||
Net operating losses | 556 | 641 | 556 | 641 | |||||||
Depreciation and amortization_Asset | 1,263 | 267 | 1,263 | 267 | |||||||
Other | 3,599 | 3,084 | 3,599 | 3,084 | |||||||
Valuation allowance | (3,079) | (2,912) | (3,079) | (2,912) | |||||||
Total deferred tax assets | 19,925 | 21,019 | 19,925 | 21,019 | |||||||
Deferred tax liabilities [Abstract] | |||||||||||
Translation adjustment | 55 | 1,615 | 55 | 1,615 | |||||||
Other | 339 | 1,040 | 339 | 1,040 | |||||||
Total deferred tax liabilities | 394 | $ 2,655 | 394 | 2,655 | |||||||
Carryforwards [Line Items] | |||||||||||
Operating Loss Carryforwards, Valuation Allowance | $ 1,378 | $ 1,378 | |||||||||
Operating loss carryforwards expiration dates | fiscal year 2017 through fiscal year 2035 | ||||||||||
Foreign income tax adjustment | $ 868 | ||||||||||
Diluted earnings per share effect of foreign income tax adjustment | $ 0.04 | ||||||||||
Tax holiday rate percentage (in hundredths) | 0.00% | 0.00% | |||||||||
Percentage of local statutory rate in effect for 2016 and 2017 | 50.00% | 50.00% | |||||||||
Approximate tax provision reduction as a result in the tax holiday | $ 5,446 | $ 3,770 | $ 467 | ||||||||
Tax Holiday approximate diluted earning per share benefit | $ 0.22 | $ 0.15 | $ 0.02 | ||||||||
Capital Loss Carryforward [Member] | |||||||||||
Carryforwards [Line Items] | |||||||||||
Tax Credit Carryforward, Amount | $ 2,849 | $ 2,849 | |||||||||
Tax Credit Carryforward, Valuation Allowance | 2,849 | $ 2,849 | |||||||||
Internal Revenue Service (IRS) [Member] | |||||||||||
Income Tax Examination [Line Items] | |||||||||||
Tax periods open to examination by taxing authorities (years) | fiscal years 2013 through 2015 | ||||||||||
State and Local Jurisdiction [Member] | |||||||||||
Income Tax Examination [Line Items] | |||||||||||
Tax periods open to examination by taxing authorities (years) | fiscal years 2012 through 2015 | ||||||||||
Carryforwards [Line Items] | |||||||||||
Net operating loss carryforwards | 848 | $ 848 | |||||||||
Tax Credit Carryforward, Amount | 2,497 | 2,497 | |||||||||
Tax Credit Carryforward, Valuation Allowance | 2,430 | $ 2,430 | |||||||||
Foreign Country [Member] | |||||||||||
Income Tax Examination [Line Items] | |||||||||||
Tax periods open to examination by taxing authorities (years) | fiscal years 2011 through 2015 | ||||||||||
Carryforwards [Line Items] | |||||||||||
Net operating loss carryforwards | $ 1,471 | $ 1,471 |
COMMITMENTS AND CONTINGENCIES66
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Movement in standard product warranty accrual [Roll Forward] | |||
Balance as of September 30, 2014 | $ 246 | ||
Reserve for product warranty during the reporting period | 608 | ||
Settlement of warranty | (645) | ||
Balance as of September 30, 2015 | $ 209 | $ 246 | |
Lease commitments [Abstract] | |||
Expiration of cancelable and noncancelable leases, maximum | 6 years | ||
Rent expense under operating leases | $ 2,195 | 2,425 | $ 2,594 |
Operating leases, future minimum payments due: | |||
2,016 | 1,708 | ||
2,017 | 1,380 | ||
2,018 | 795 | ||
2,019 | 719 | ||
2,020 | 719 | ||
Thereafter | 3,191 | ||
Operating leases, total | 8,512 | ||
Purchase obligations [Abstract] | |||
Purchase obligation, due in 2017 | 1,500 | ||
Purchase obligation | 4,326 | ||
Contractual obligation | 23,237 | ||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Net Periodic Benefit Cost | 962 | 652 | $ 686 |
2,016 | 172 | ||
2,017 | 260 | ||
2,018 | 210 | ||
2,019 | 232 | ||
2,020 | 352 | ||
2021 to 2025 | 2,188 | ||
Foreign Postretirement Benefit Plans, Defined Benefit [Member] | Japan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Projected benefit obligation | 5,197 | 5,025 | |
Accumulated benefit obligation | $ 3,941 | $ 3,782 | |
Weighted average discount rate (in hundredths) | 1.25% | 1.50% | |
Expected rate of compensation increase (In hundredths) | 2.00% | 2.00% | |
Pension costs in accumulated other comprehensive income | $ 1,076 | $ 860 | |
Foreign Postretirement Benefit Plans, Defined Benefit [Member] | South Korea [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined benefit obligation | $ 1,155 | $ 849 | |
Weighted average discount rate (in hundredths) | 4.00% | 4.25% | |
Expected rate of compensation increase (In hundredths) | 4.50% | 4.50% | |
Pension costs in accumulated other comprehensive income | $ 102 | $ 0 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Numerator [Abstract] | |||||||||||
Net income | $ 12,533 | $ 9,886 | $ 13,811 | $ 19,916 | $ 16,046 | $ 13,302 | $ 10,095 | $ 11,308 | $ 56,146 | $ 50,751 | $ 52,578 |
Less: income attributable to participating securities | (483) | (442) | (506) | ||||||||
Net income available to common shareholders | $ 55,663 | $ 50,309 | $ 52,072 | ||||||||
Denominator[Abstract] | |||||||||||
Weighted-average common shares (Denominator for basic calculation, in shares) | 24,144,000 | 24,333,000 | 24,057,000 | 23,651,000 | 23,500,000 | 23,753,000 | 23,982,000 | 23,590,000 | 24,039,692 | 23,704,024 | 22,924,056 |
Weighted-average effect of dilutive securities [Abstract] | |||||||||||
Share-based compensation (in shares) | 592,123 | 906,884 | 836,010 | ||||||||
Diluted-weighted average common shares (Denominator for diluted calculation, in shares) | 24,583,000 | 24,813,000 | 24,693,000 | 24,486,000 | 24,334,000 | 24,613,000 | 24,897,000 | 24,623,000 | 24,631,815 | 24,610,908 | 23,760,066 |
Earnings per share [Abstract] | |||||||||||
Basic (in dollars per share) | $ 0.51 | $ 0.40 | $ 0.57 | $ 0.83 | $ 0.67 | $ 0.55 | $ 0.42 | $ 0.47 | $ 2.32 | $ 2.12 | $ 2.27 |
Diluted (in dollars per share) | $ 0.50 | $ 0.39 | $ 0.55 | $ 0.80 | $ 0.65 | $ 0.53 | $ 0.40 | $ 0.45 | $ 2.26 | $ 2.04 | $ 2.19 |
Outstanding stock options excluded from diluted earnings (in shares) | 700,000 | 500,000 | 1,500,000 |
FINANCIAL INFORMATION BY INDU68
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Sep. 30, 2015USD ($)Segment | Sep. 30, 2014USD ($) | Sep. 30, 2013USD ($) | |
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE [Abstract] | |||||||||||
Number of segment | Segment | 1 | ||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | $ 100,137 | $ 97,168 | $ 104,858 | $ 111,934 | $ 116,337 | $ 108,358 | $ 99,456 | $ 100,515 | $ 414,097 | $ 424,666 | $ 433,131 |
Property, plant and equipment, net | 93,743 | 100,821 | 93,743 | 100,821 | 111,985 | ||||||
United States [Member] | Reportable Geographical Components [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 55,989 | 51,036 | 53,955 | ||||||||
Property, plant and equipment, net | 43,239 | 44,585 | 43,239 | 44,585 | 47,436 | ||||||
Asia [Member] | Reportable Geographical Components [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 328,669 | 347,669 | 347,797 | ||||||||
Property, plant and equipment, net | 50,504 | 56,236 | 50,504 | 56,236 | 64,546 | ||||||
Europe [Member] | Reportable Geographical Components [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 29,439 | 25,961 | 31,379 | ||||||||
Property, plant and equipment, net | $ 0 | $ 0 | $ 0 | $ 0 | $ 3 |
FINANCIAL INFORMATION BY INDU69
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE, REVENUE BY MAJOR CUSTOMERS (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
Revenue, Major Customer [Line Items] | ||||||
Threshold for reporting (in hundredths) | 10.00% | 10.00% | 10.00% | |||
Taiwan [Member] | ||||||
Revenue, Major Customer [Line Items] | ||||||
Revenue | $ 124,460 | $ 138,049 | $ 133,273 | |||
South Korea [Member] | ||||||
Revenue, Major Customer [Line Items] | ||||||
Revenue | 70,608 | 71,420 | $ 73,778 | |||
China [Member] | ||||||
Revenue, Major Customer [Line Items] | ||||||
Revenue | $ 49,350 | $ 45,200 | [1] | [1] | ||
Japan [Member] | ||||||
Revenue, Major Customer [Line Items] | ||||||
Revenue | [1] | [1] | ||||
[1] | Denotes less than ten percent of total |
FINANCIAL INFORMATION BY INDU70
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE, LONG-LIVED ASSETS BY MAJOR CUSTOMERS (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 |
Japan [Member] | |||
Segment Reporting, Schedule of Long-Lived Assets by Major Customers, by Reporting Segments [Line Items] | |||
Property, plant and equipment, net | $ 22,572 | $ 27,110 | $ 33,566 |
Taiwan [Member] | |||
Segment Reporting, Schedule of Long-Lived Assets by Major Customers, by Reporting Segments [Line Items] | |||
Property, plant and equipment, net | 17,419 | 16,675 | 17,212 |
South Korea [Member] | |||
Segment Reporting, Schedule of Long-Lived Assets by Major Customers, by Reporting Segments [Line Items] | |||
Property, plant and equipment, net | $ 9,658 | $ 11,564 | $ 12,591 |
FINANCIAL INFORMATION BY INDU71
FINANCIAL INFORMATION BY INDUSTRY SEGMENT, GEOGRAPHIC AREA AND PRODUCT LINE, SEGMENT REPORTING INFORMATION BY PRODUCT TYPE (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Revenue from External Customer [Line Items] | |||||||||||
Revenue | $ 100,137 | $ 97,168 | $ 104,858 | $ 111,934 | $ 116,337 | $ 108,358 | $ 99,456 | $ 100,515 | $ 414,097 | $ 424,666 | $ 433,131 |
Tungsten slurries [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Revenue | 178,770 | 162,148 | 155,904 | ||||||||
Dielectric slurries [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Revenue | 96,386 | 118,079 | 123,180 | ||||||||
Other Metals slurries [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Revenue | 71,640 | 76,605 | 76,367 | ||||||||
Polishing pads [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Revenue | 32,048 | 33,824 | 32,996 | ||||||||
Data storage slurries [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Revenue | 13,719 | 17,850 | 20,685 | ||||||||
Engineered Surface Finishes [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Revenue | $ 21,534 | $ 16,160 | $ 23,999 |
SELECTED QUARTERLY OPERATING 72
SELECTED QUARTERLY OPERATING RESULTS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
SELECTED QUARTERLY OPERATING RESULTS [Abstract] | |||||||||||
Revenue | $ 100,137 | $ 97,168 | $ 104,858 | $ 111,934 | $ 116,337 | $ 108,358 | $ 99,456 | $ 100,515 | $ 414,097 | $ 424,666 | $ 433,131 |
Cost of goods sold | 48,115 | 48,609 | 50,182 | 54,960 | 59,209 | 56,632 | 52,931 | 52,801 | 201,866 | 221,573 | 221,015 |
Gross profit | 52,022 | 48,559 | 54,676 | 56,974 | 57,128 | 51,726 | 46,525 | 47,714 | 212,231 | 203,093 | 212,116 |
Operating expenses: | |||||||||||
Research, development and technical | 14,856 | 14,773 | 15,131 | 15,018 | 15,051 | 15,368 | 14,364 | 14,571 | 59,778 | 59,354 | 61,373 |
Selling and marketing | 5,763 | 5,804 | 5,777 | 7,639 | 6,846 | 6,489 | 6,471 | 6,707 | 24,983 | 26,513 | 27,985 |
General and administrative | 13,553 | 12,830 | 14,296 | 11,751 | 12,236 | 11,380 | 11,076 | 10,726 | 52,430 | 45,418 | 46,287 |
Total operating expenses | 34,172 | 33,407 | 35,204 | 34,408 | 34,133 | 33,237 | 31,911 | 32,004 | 137,191 | 131,285 | 135,645 |
Operating income | 17,850 | 15,152 | 19,472 | 22,566 | 22,995 | 18,489 | 14,614 | 15,710 | 75,040 | 71,808 | 76,471 |
Interest expense | 1,494 | 1,065 | 1,059 | 906 | 807 | 832 | 843 | 872 | 4,524 | 3,354 | 3,643 |
Other income (expense), net | 116 | (160) | (332) | 1,057 | (448) | (132) | 103 | 617 | 681 | 140 | 1,392 |
Income before income taxes | 16,472 | 13,927 | 18,081 | 22,717 | 21,740 | 17,525 | 13,874 | 15,455 | 71,197 | 68,594 | 74,220 |
Provision for income taxes | 3,939 | 4,041 | 4,270 | 2,801 | 5,694 | 4,223 | 3,779 | 4,147 | 15,051 | 17,843 | 21,642 |
Net income | $ 12,533 | $ 9,886 | $ 13,811 | $ 19,916 | $ 16,046 | $ 13,302 | $ 10,095 | $ 11,308 | $ 56,146 | $ 50,751 | $ 52,578 |
Basic earnings per share (in dollars per share) | $ 0.51 | $ 0.40 | $ 0.57 | $ 0.83 | $ 0.67 | $ 0.55 | $ 0.42 | $ 0.47 | $ 2.32 | $ 2.12 | $ 2.27 |
Weighted average basic shares outstanding (in shares) | 24,144,000 | 24,333,000 | 24,057,000 | 23,651,000 | 23,500,000 | 23,753,000 | 23,982,000 | 23,590,000 | 24,039,692 | 23,704,024 | 22,924,056 |
Diluted earnings per share (in dollars per share) | $ 0.50 | $ 0.39 | $ 0.55 | $ 0.80 | $ 0.65 | $ 0.53 | $ 0.40 | $ 0.45 | $ 2.26 | $ 2.04 | $ 2.19 |
Weighted average diluted shares outstanding (in shares) | 24,583,000 | 24,813,000 | 24,693,000 | 24,486,000 | 24,334,000 | 24,613,000 | 24,897,000 | 24,623,000 | 24,631,815 | 24,610,908 | 23,760,066 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ in Thousands | Oct. 22, 2015USD ($) |
SUBSEQUENT EVENTS [Abstract] | |
Purchase price | $ 142,300 |
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% |
SCHEDULE II-VALUATION AND QUALI
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Allowance for Doubtful Accounts [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at beginning of year | $ 1,392 | $ 1,532 | $ 4,757 |
Amounts charged to expenses | (84) | (170) | 173 |
Deductions and adjustments | (84) | 30 | (3,398) |
Balance at end of year | 1,224 | 1,392 | 1,532 |
Warranty Reserves [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at beginning of year | 246 | 324 | 359 |
Amounts charged to expenses | 608 | 760 | 874 |
Adjustments to pre-existing warranty reserve | 0 | 0 | 0 |
Settlement of warranty | (645) | (838) | (909) |
Balance at end of year | 209 | 246 | 324 |
Valuation Allowance [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at beginning of year | 2,912 | 2,288 | 1,378 |
Amounts charged to expenses | 167 | 624 | 910 |
Deductions and adjustments | 0 | 0 | 0 |
Balance at end of year | $ 3,079 | $ 2,912 | $ 2,288 |